Document:

exv4w1

 

OMNIBUS INSTRUMENT

     WHEREAS, the parties named herein desire to enter into certain Program Documents contained
herein, each such document dated as of this 19th day of August, 2005, relating to the
issuance by Principal Life Income Fundings Trust 2005-84 (the “Trust”) of Notes to investors under
Principal Life’s secured notes program;

     WHEREAS, the Trust is a trust and will be organized under and its activities will be governed
by the provisions of the Trust Agreement (set forth in Section A of this Omnibus Instrument), dated
as of the date of the Pricing Supplement (attached to this Omnibus Instrument as Exhibit D)
(the “Pricing Supplement”), by and between the parties thereto indicated in Section F herein;

     WHEREAS, certain expense and indemnification arrangements between Principal Life and the
Trustee, on behalf of itself and on behalf of the Trust, are governed pursuant to the provisions of
the Expense and Indemnity Agreement dated as of March 5, 2004, by and between Principal Life and
the Trustee;

     WHEREAS, certain licensing arrangements between the Trust and Principal Financial Services,
Inc. will be governed pursuant to the provisions of the License Agreement (set forth in Section B
of this Omnibus Instrument), dated as of the date of the Pricing Supplement, by and between the
parties thereto indicated in Section F herein;

     WHEREAS, certain custodial arrangements of the Funding Agreement and the Guarantee will be
governed pursuant to the provisions of the Custodial Agreement (the “Custodial Agreement”) dated as
of March 5, 2004 by and among Bankers Trust Company, N.A., acting as custodian (the “Custodian”),
the Indenture Trustee and the Trustee, on behalf of the Trust;

     WHEREAS, the Notes will be issued pursuant to the Indenture (set forth in Section C of this
Omnibus Instrument), dated as of the Original Issue Date, by and between the parties thereto
indicated in Section F herein;

     WHEREAS, the sale of the Notes will be governed by the Terms Agreement (set forth in Section D
of this Omnibus Instrument), dated the date of the Pricing Supplement, by and among the parties
thereto indicated in Section F herein; and

     WHEREAS, certain agreements relating to the Notes, the Funding Agreement and the Guarantee are
set forth in the Coordination Agreement (set forth in Section E of this Omnibus Instrument), dated
as of the date of the Pricing Supplement, by and among the parties thereto indicated in Section F
herein.

     All capitalized terms used herein and not otherwise defined will have the meanings set forth
in the Indenture.

[Remainder of Page Intentionally Left Blank.]

 

 

SECTION A

TRUST AGREEMENT

     This TRUST AGREEMENT (this “Trust Agreement”), dated as of the date of the
Pricing Supplement, is entered into by and between GSS Holdings II, Inc., a
Delaware corporation, as trust beneficial owner (the “Trust Beneficial Owner”),
and U.S. Bank Trust National Association, a national banking association, as
Trustee (the “Trustee”).

W I T N E S S E T H:

     WHEREAS, the Trust Beneficial Owner and the Trustee desire to authorize
the issuance of a Trust Beneficial Interest and a series of Notes in connection
with the entry into this Trust Agreement;

     WHEREAS, all things necessary to make this Trust Agreement a valid and
legally binding agreement of the Trustee and the Trust Beneficial Owner,
enforceable in accordance with its terms, have been done;

     WHEREAS, the parties intend to provide for, among other things, (i) the
issuance and sale of the Notes (pursuant to the Indenture, the Distribution
Agreement and the related Terms Agreement) and the Trust Beneficial Interest,
(ii) the use of the proceeds of the sale of the Notes and Trust Beneficial
Interest to acquire the Funding Agreement, the payment obligations of which
will be fully and unconditionally guaranteed by the Guarantee, and (iii) all
other actions deemed necessary or desirable in connection with the transactions
contemplated by this Trust Agreement; and

     WHEREAS, the parties hereto desire to incorporate by reference those
certain Standard Trust Terms, dated as of March 5, 2004, and attached to the
Omnibus Instrument as Exhibit A (the “Standard Trust Terms”) and all
capitalized terms not otherwise defined herein (including the recitals hereof)
shall have the meanings set forth in the Standard Trust Terms (the Standard
Trust Terms and this Trust Agreement, collectively, the “Trust Agreement”).

     NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the sufficiency of
which are hereby acknowledged, each party hereby agrees as follows:

ARTICLE 1

     Section 1.01 Incorporation by Reference. All terms, provisions and
agreements set forth in the Standard Trust Terms (except to the extent
expressly modified herein) are hereby incorporated herein by reference with the
same force and effect as though fully set forth herein. To the extent that the
terms set forth in Article 2 of this Trust Agreement are inconsistent with the
terms of the Standard Trust Terms, the terms set forth in Article 2 herein
shall apply.

A-1

 

ARTICLE 2

     Section 2.01 Name. The Trust created and governed by the Trust Agreement
shall be the trust specified in the Omnibus Instrument. The name of the Trust
shall be the name specified in the first paragraph of the Omnibus Instrument,
as such name may be modified from time to time by the Trustee following written
notice to the Trust Beneficial Owner.

     Section 2.02 Jurisdiction. The Trust is hereby organized in, and formed
under and pursuant to, the laws of the State of New York.

     Section 2.03 Initial Capital Contribution and Ownership. The Trust
Beneficial Owner has paid or has caused to be paid to, or to an account at the
direction of, the Trustee, on the date hereof, the sum of $15 (or, in the case
of Notes issued with original issue discount, such amount multiplied by the
issue price of the Notes). The Trustee hereby acknowledges receipt in trust
from the Trust Beneficial Owner, as of the date hereof, of the foregoing
contribution, which shall be used along with the proceeds from the sale of the
series of Notes to purchase the Funding Agreement. Upon the creation of the
Trust and the registration of the Trust Beneficial Interest in the Securities
Register (as defined in the Trust Agreement) by the Registrar in the name of
the Trust Beneficial Owner, the Trust Beneficial Owner shall be the sole
beneficial owner of the Trust.

     Section 2.04 Acknowledgment. The Trustee, on behalf of the Trust,
expressly acknowledges its duties and obligations set forth in the Standard
Trust Terms incorporated herein.

     Section 2.05 Additional Terms.

     None

     Section 2.06 Omnibus Instrument; Execution and Incorporation of Terms.

     The parties to the Trust Agreement will enter into the Trust Agreement by
executing the Omnibus Instrument.

     By executing the Omnibus Instrument, the Trustee and the Trust Beneficial
Owner hereby agree that the Trust Agreement will constitute a legal, valid and
binding agreement between the Trustee and the Trust Beneficial Owner.

     All terms relating to the Trust or the series of Notes not otherwise
included in the Trust Agreement will be as specified in the Omnibus Instrument
or Pricing Supplement, as indicated herein.

A-2

 

     Section 2.07 Governing Law. The Trust Agreement will be governed by, and
construed in accordance with, the laws of the State of New York.

     Section 2.08 Counterparts. The Trust Agreement, through the Omnibus
Instrument, may be executed in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.

[Remainder of Page Intentionally Left Blank.]

A-3

 

SECTION B

LICENSE AGREEMENT

     This LICENSE AGREEMENT (this “License Agreement”), dated as of the date of
the Pricing Supplement, is entered into by and between Principal Financial
Services, Inc., an Iowa corporation with its principal place of business at 711
High Street, Des Moines, Iowa 50392 (the “Licensor”), and the Principal Life
Income Fundings Trust specified in the Omnibus Instrument (the “Licensee”).

W I T N E S S E T H:

     WHEREAS, the Licensor is the owner of certain trademarks and service marks
and registrations and pending applications therefor, and may acquire additional
trademarks and service marks in the future, all as described more fully below;

     WHEREAS, the Licensee desires to use certain of the Licensor’s trademarks
and service marks in connection with the Licensee’s activities, as described
more fully below;

     WHEREAS, the Licensor and the Licensee wish to formalize the agreement
between them regarding the Licensee’s use of the Licensor’s marks; and

     WHEREAS, the parties hereto desire to incorporate by reference those
certain Standard License Agreement Terms, dated March 5, 2004, and attached to
the Omnibus Instrument as Exhibit B (the “Standard License Agreement Terms”)
and all capitalized terms not otherwise defined herein (including the recitals
hereof) shall have the meanings set forth in the Standard License Agreement
Terms (the Standard License Agreement Terms and this License Agreement,
collectively, the “License Agreement”).

     NOW, THEREFORE, in consideration of the mutual promises set forth herein
and for other good and valuable consideration, the sufficiency and receipt of
which are hereby acknowledged, each party hereby agrees as follows:

ARTICLE 1

     Section 1.01 Incorporation by Reference. All terms, provisions and
agreements set forth in the Standard License Agreement Terms (except to the
extent expressly modified herein) are hereby incorporated herein by reference
with the same force and effect as though fully set forth herein. To the extent
that the terms set forth in Article 2 of this License Agreement are
inconsistent with the terms of the Standard License Agreement Terms, the terms
set forth in Article 2 herein shall apply.

ARTICLE 2

     Section 2.01 Additional Terms.

     None

B-1

 

     Section 2.02 Omnibus Instrument; Execution and Incorporation of Terms.

     The parties to the License Agreement will enter into the License Agreement
by executing the Omnibus Instrument.

     By executing the Omnibus Instrument, the Licensor and the Licensee hereby
agree that the License Agreement will constitute a legal, valid and binding
agreement between the Licensor and the Licensee.

     All terms relating to the Trust or the Notes not otherwise included in the
License Agreement will be as specified in the Omnibus Instrument or Pricing
Supplement, as indicated herein.

     Section 2.03 Counterparts. The License Agreement, through the Omnibus
Instrument, may be executed in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.

[Remainder of Page Intentionally Left Blank.]

B-2

 

SECTION C

INDENTURE

     This INDENTURE (this “Indenture”) is entered into as of the Original Issue
Date by and between the Principal Life Income Fundings Trust specified in the
Omnibus Instrument (the “Trust”) and Citibank, N.A., as indenture trustee (the
“Indenture Trustee”).

     Citibank, N.A., in its capacity as indenture trustee, hereby accepts its
role as Registrar, Paying Agent, Transfer Agent and Calculation Agent
hereunder.

     References herein to “Indenture Trustee,” “Registrar,” “Transfer Agent,”
“Paying Agent” or “Calculation Agent” shall include the permitted successors
and assigns of any such entity from time to time.

W I T N E S S E T H:

     WHEREAS, the Trust has duly authorized the execution and delivery of this
Indenture to provide for the issuance of Notes;

     WHEREAS, all things necessary to make this Indenture a valid and legally
binding agreement of the Trust and the other parties to this Indenture,
enforceable in accordance with its terms, have been done, and the Trust
proposes to do all things necessary to make the Notes, when executed by the
Trust and authenticated and delivered pursuant hereto, valid and legally
binding obligations of the Trust as hereinafter provided; and

     WHEREAS, the parties hereto desire to incorporate by reference those
certain Standard Indenture Terms, dated as of March 5, 2004, and attached to
the Omnibus Instrument as Exhibit C (the “Standard Indenture Terms”) and all
capitalized terms not otherwise defined herein (including the recitals hereof)
shall have the meanings set forth in the Standard Indenture Terms (the Standard
Indenture Terms and this Indenture, collectively, the “Indenture”).

     NOW, THEREFORE, for and in consideration of the premises and the purchase
of the Notes by the Holders thereof, it is mutually covenanted and agreed by
each of the parties hereto as follows:

ARTICLE 1

     Section 1.01 Incorporation by Reference. All terms, provisions and
agreements set forth in the Standard Indenture Terms (except to the extent
expressly modified herein) are hereby incorporated herein by reference (with
the same force and effect as though fully set forth herein). To the extent
that the terms set forth in Article 2 of this Indenture are inconsistent with
the terms of the Standard Indenture Terms, the terms set forth in Article 2
herein shall apply.

C-1

 

ARTICLE 2

     Section 2.01 Agreement to be Bound. Each of the Trust, the Indenture
Trustee, the Registrar, the Transfer Agent, the Paying Agent and the
Calculation Agent hereby agrees to be bound by all of the terms, provisions and
agreements set forth in the Indenture, with respect to all matters contemplated
in the Indenture, including, without limitation, those relating to the issuance
of the below-referenced Notes.

     Section 2.02 Designation of the Trust, the Notes, the Funding Agreement
and the Guarantee. The Trust created by the Trust Agreement and referred to in
the Indenture is the Principal Life Income Fundings Trust specified in the
Omnibus Instrument. The Notes issued by the Trust and governed by the
Indenture shall be the Notes specified in the Pricing Supplement. The Funding
Agreement designated hereby is the Funding Agreement designated in the Pricing
Supplement dated as of the Original Issue Date between the Trust and Principal
Life. The Guarantee designated hereby is the Guarantee dated as of the Original
Issue Date of PFG.

     Section 2.03 Additional Terms.

     None

     Section 2.04 Omnibus Instrument; Execution and Incorporation of Terms.

     The parties to the Indenture will enter into the Indenture by executing
the Omnibus Instrument.

     By executing the Omnibus Instrument, the Indenture Trustee, the Registrar,
the Transfer Agent, the Paying Agent, the Calculation Agent and the Trust
hereby agree that the Indenture will constitute a legal, valid and binding
agreement between the Indenture Trustee, the Registrar, the Transfer Agent, the
Paying Agent, the Calculation Agent and the Trust.

     All terms relating to the Trust or the Notes not otherwise included in the
Indenture will be as specified in the Omnibus Instrument or Pricing Supplement,
as indicated herein.

     Section 2.05 Counterparts. The Indenture, through the Omnibus Instrument,
may be executed in any number of counterparts, each of which counterparts shall
be deemed to be an original, and all of which counterparts shall constitute one
and the same instrument.

[Remainder of Page Intentionally Left Blank.]

C-2

 

SECTION D

TERMS AGREEMENT

     This TERMS AGREEMENT (this “Terms Agreement”) is entered into as of the
Original Issue Date by and among Principal Life Insurance Company (“Principal
Life”), Principal Financial Group, Inc. (“PFG”), the Principal Life Income
Fundings Trust specified in the Omnibus Instrument (the “Trust”) and the
Purchasing Agent specified in the Pricing Supplement (the “Purchasing Agent”).

W I T N E S S E T H:

     WHEREAS, Principal Life, PFG and the agents named therein, including the
Purchasing Agent have entered into that certain Distribution Agreement dated
March 5, 2004 (the “Distribution Agreement”).

     NOW, THEREFORE, in consideration of the mutual promises set forth herein
and other good and valuable consideration, the sufficiency and receipt of which
are hereby acknowledged, each of the parties hereby agrees as follows:

ARTICLE 1

     Section 1.01 Incorporation by Reference. The provisions of the
Distribution Agreement and the related definitions (unless otherwise specified
herein) are incorporated by reference herein and shall be deemed to have the
same force and effect as if set forth in full herein.

ARTICLE 2

     Section 2.01 Addition of Trust as Party to Distribution Agreement.

     Pursuant to Section 1 of the Distribution Agreement, each of the
undersigned parties hereby acknowledges and agrees that the Trust, upon
execution hereof by the Trust and the other parties to the Distribution
Agreement (other than any other trusts organized in connection with the
Registration Statement that are party thereto as of the date hereof), shall
become a Trust for purposes of the Distribution Agreement in accordance with
the terms thereof, in respect of the Notes, with all the authority, rights,
powers, duties and obligations of a Trust under the Distribution Agreement.
The Trust confirms that any agreement, covenant, acknowledgment, representation
or warranty under the Distribution Agreement applicable to the Trust is made by
the Trust at the date hereof, unless another time or times are specified in the
Distribution Agreement, in which case such agreement, covenant, acknowledgment,
representation or warranty shall be deemed to be confirmed by the Trust at such
specified time or times.

     Section 2.02 Purchase of Notes as Principal.

     (a) Subject in all respects to the terms and conditions of the
Distribution Agreement, the Trust hereby agrees to sell to the Purchasing Agent
and the Purchasing Agent hereby agrees to purchase the Notes having the terms
specified in the Pricing Supplement relating to such Notes.

D-1

 

     (b) In connection with any purchase of Notes from the Trust by the
Purchasing Agent as principal, the parties agrees that the items specified on
Schedule I of the Omnibus Instrument will be delivered as of the Settlement
Date.

     Section 2.03 Termination. Upon the termination of this Terms Agreement
pursuant to Section 13(b) of the Distribution Agreement the undersigned parties
hereby agree to that the expenses reasonably incurred prior to or in connection
with such termination will be borne by Principal Life and PFG.

     Section 2.04 Governing Law. This Terms Agreement shall be governed by and
construed in accordance with the laws of the State of New York without regard
to the principles of conflicts of laws thereof.

     Section 2.05 Notices. For purposes of Section 14 of the Distribution
Agreement, the Trust’s communications details are as set forth in Section E of
the Omnibus Instrument.

     Section 2.06 Omnibus Instrument; Execution and Incorporation of Terms.

     The parties to this Terms Agreement will enter into this Terms Agreement
by executing the Omnibus Instrument.

     By executing the Omnibus Instrument, each party hereto agrees that this
Terms Agreement will constitute a legal, valid and binding agreement by and
among such parties.

     All terms relating to the Trust or the Notes not otherwise included in
this Terms Agreement will be as specified in the Omnibus Instrument or Pricing
Supplement, as indicated herein.

     Section 2.07 Counterparts. This Terms Agreement, through the Omnibus
Instrument, may be executed in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.

[Remainder of Page Intentionally Left Blank.]

D-2

 

SECTION E

COORDINATION AGREEMENT

     This COORDINATION AGREEMENT (this “Coordination Agreement”), dated as of
the date of the Pricing Supplement, is entered into by and among Principal Life
Insurance Company (“Principal Life”), Principal Financial Group, Inc. (“PFG”),
the Principal Life Income Fundings Trust specified in the Omnibus Instrument
(the “Trust”), Principal Financial Services, Inc. (“PFSI”), Bankers Trust
Company, N.A. and Citibank, N.A., as indenture trustee (the “Indenture
Trustee”).

W I T N E S S E T H

     WHEREAS, the Trust will enter into the Funding Agreement with Principal
Life dated as of the Original Issue Date specified in the Pricing Supplement;

     WHEREAS, PFG will issue a Guarantee to the Trust as of the Original Issue
Date specified in the Pricing Supplement, which will fully and unconditionally
guarantee the payment obligations of Principal Life under the Funding
Agreement;

     WHEREAS, the Purchasing Agent (as defined in the Distribution Agreement)
have agreed to sell the Notes in accordance with the Registration Statement;

     WHEREAS, the Trust intends to issue the Notes in accordance with the
Indenture, to collaterally assign to, and grant a security interest in, the
Funding Agreement and the Guarantee to and in favor of the Indenture Trustee in
accordance with the Indenture to secure payment of the Notes;

     WHEREAS, the Custodian will hold the Funding Agreement and the Guarantee
on behalf of the Indenture Trustee pursuant to the terms of the Custodial
Agreement; and

     WHEREAS, certain licensing arrangements between the Trust and PFSI will be
governed pursuant to the provisions of the License Agreement.

     NOW, THEREFORE, to give effect to the agreements and arrangements
established under the Terms Agreement included in the Omnibus Instrument, as
applicable, the Trust Agreement, the Indenture and the Notes, and in
consideration of the agreements and obligations set forth herein and for other
good and valuable consideration, the sufficiency of which are hereby
acknowledged, each party hereby agrees as follows:

ARTICLE 1

     Section 1.01 Delivery of the Funding Agreement and the Guarantee. The
Trust hereby authorizes the Custodian, on behalf of the Indenture Trustee, to
receive the Funding Agreement from Principal Life and the Guarantee from PFG
pursuant to the assignment of the Funding Agreement and Guarantee (the
“Assignment”), to be entered into on the Original Issue Date, included in the
closing instrument dated as of the Original Issue Date (the “Closing
Instrument”).

E-1

 

     Section 1.02 Issuance and Purchase of the Notes.

     (a) Delivery of the Funding Agreement and the Guarantee to the Custodian,
on behalf of the Indenture Trustee, pursuant to the Assignment or execution of
the cross receipt contained in the Closing Instrument shall be confirmation of
payment by the Trust for the Funding Agreement.

     (b) The Trust hereby directs the Indenture Trustee, upon receipt by the
Custodian, on behalf of the Indenture Trustee, of the Funding Agreement
pursuant to the Assignment and upon receipt by the Custodian, on behalf of the
Indenture Trustee, of the Guarantee, (i) to authenticate the certificates
representing the Notes (the “Notes Certificates”) in accordance with the
Indenture and (ii) to (A) deliver each relevant Notes Certificate to the
clearing system or systems identified in each such Notes Certificate, or to the
nominee of such clearing system, or the custodian thereof, for credit to such
accounts as the Purchasing Agent may direct, or (B) deliver each relevant Notes
Certificate to the purchasers thereof as identified by the Purchasing Agent.

ARTICLE 2

     Section 2.01 Directions Regarding Periodic Payments. As registered owner
of the Funding Agreement and the Guarantee as collateral securing payments on
the Notes, the Indenture Trustee will receive payments on the Funding Agreement
and the Guarantee on behalf of the Trust. The Trust hereby directs the
Indenture Trustee to use such funds to make payments on behalf of the Trust
pursuant to the Trust Agreement and the Indenture.

     Section 2.02 Maturity of the Funding Agreement. Upon the maturity of the
Funding Agreement and the return of funds thereunder, the Trust hereby directs
the Indenture Trustee to set aside from such funds an amount sufficient for the
repayment of the outstanding principal on the Notes and Trust Beneficial
Interest when due.

ARTICLE 3

     Section 3.01 Certificates. Principal Life hereby agrees to deliver an
Officer’s Certificate, a copy of which is attached hereto as Exhibit E, on a
quarterly basis to any rating agency currently rating the Program. The Trust
hereby agrees to deliver an Officer’s Certificate, a copy of which is attached
hereto as Exhibit F, on a quarterly basis to any rating agency currently rating
the Program.

     Section 3.02 Filings. Principal Life hereby covenants to file, or cause
to be filed, in a timely manner on behalf of the Trust all reports,
certifications or similar filings required under the Securities Exchange Act of
1934, as amended.

ARTICLE 4

     Section 4.01 No Additional Liability. Nothing in this Coordination
Agreement shall impose any liability or obligation on the part of any party to
this Coordination Agreement to make any payment or disbursement in addition to
any liability or obligation such party has under the Program Documents, except
to the extent that a party has actually received funds which it is obligated to
disburse pursuant to this Coordination Agreement.

E-2

 

     Section 4.02 No Conflict. This Coordination Agreement is intended to be
in furtherance of the agreements reflected in the documents related to the
Program Documents, and not in conflict. To the extent that a provision of this
Coordination Agreement conflicts with the provisions of one or more Program
Documents, the provisions of such Program Documents shall govern.

     Section 4.03 Governing Law. This Coordination Agreement shall be governed
by and construed in accordance with the laws of the State of New York without
regard to the principles of conflicts of laws thereof.

     Section 4.04 Severability. If any provision in this Coordination
Agreement shall be invalid, illegal or unenforceable, such provision shall be
deemed severable from the remaining provisions of this Coordination Agreement
and shall in no way affect the validity or enforceability of such other
provisions of this Coordination Agreement.

     Section 4.05 Severability. If any provision in this Coordination
Agreement shall be invalid, illegal or unenforceable, such provision shall be
deemed severable from the remaining provisions of this Coordination Agreement
and shall in no way affect the validity or enforceability of such other
provisions of this Coordination Agreement.

     Section 4.06 Notices. All demands, notices and communications under this
Coordination Agreement shall be in writing and shall be deemed to have been
duly given upon receipt at the addresses set forth below:

	 	 	 
	To the Trust:
	 	 
	 
	

	 	Principal Life Income Fundings
Trust (followed by the number set forth in the Omnibus Instrument)
	

	 	c/o U.S. Bank Trust National Association
	

	 	100 Wall Street, 16th Floor
	

	 	New York, New York 10005
	

	 	Attention: Corporate Trust Administration
	

	 	Telephone: (212) 361-2458
	

	 	Facsimile: (212) 809-5459 and (212) 509-3384
	 
	To the Indenture Trustee:
	 	 
	 
	

	 	Citibank, N.A.
	

	 	Citibank Agency & Trust
	

	 	388 Greenwich Street, 14th Floor
	

	 	New York, New York 10013
	

	 	Attention: Nancy Forte
	

	 	Telephone: (212) 816-5685
	

	 	Facsimile: (212) 816-5527

E-3

 

	 	 	 
	To Principal Life:

	 
	

	 	Principal Life Insurance Company
	

	 	711 High Street
	

	 	Des Moines, Iowa 50392
	

	 	Attention: General Counsel
	

	 	Telephone: (515) 247-5111
	

	 	Facsimile: (515) 248-3011
	 
	 	 	With a copy to:

	 
	

	 	Principal Life Insurance Company
	

	 	711 High Street
	

	 	Des Moines, Iowa 50392
	

	 	Attention: Jim Fifield
	

	 	Telephone: (515) 248-9196
	

	 	Facsimile: (515) 235-9353
	 
	To PFG:

	 
	

	 	Principal Financial Group, Inc.
	

	 	711 High Street
	

	 	Des Moines, Iowa 50392
	

	 	Attention: General Counsel
	

	 	Telephone: (515) 247-5111
	

	 	Facsimile: (515) 248-3011
	 
	 	 	With a copy to:
	 	 
	 
	

	 	Principal Life Insurance Company
	

	 	711 High Street
	

	 	Des Moines, Iowa 50392
	

	 	Attention: Jim Fifield
	

	 	Telephone: (515) 248-9196
	

	 	Facsimile: (515) 235-9353
	 
	To Principal Financial
Services, Inc.:
	 	 
	 
	

	 	Principal Financial Services, Inc.
	

	 	711 High Street
	

	 	Des Moines, Iowa 50392
	

	 	Attention: General Counsel
	

	 	Telephone: (515) 247-5111
	

	 	Facsimile: (515) 248-3011

E-4

 

	 	 	 
	 	 	With a copy to:
	 	 
	 
	

	 	Principal Life Insurance Company
	

	 	711 High Street
	

	 	Des Moines, Iowa 50392
	

	 	Attention: Jim Fifield
	

	 	Telephone: (515) 248-9196
	

	 	Facsimile: (515) 235-9353
	 
	To Bankers Trust Company, N.A:
	 	 
	 
	

	 	Bankers Trust Company, N.A.
	

	 	665 Locust Street
	

	 	Des Moines, Iowa 50309-3702
	

	 	Attention: Angela C. Brick
	

	 	Telephone: (515) 245-2820
	

	 	Facsimile: (515) 247-2101

or at such other address as shall be designated by any such party in a written
notice to the other parties.

ARTICLE 5

     Section 5.01 Omnibus Instrument; Execution and Incorporation of Terms.

     The parties to this Coordination Agreement will enter into this
Coordination Agreement by executing the Omnibus Instrument.

     By executing the Omnibus Instrument, each party hereto agrees that this
Coordination Agreement will constitute a legal, valid and binding agreement by
and among the Trust, Principal Life, PFG, PFSI, the Custodian and the Indenture
Trustee.

     All terms relating to the Trust or the Notes not otherwise included in
this Coordination Agreement will be as specified in the Omnibus Instrument or
Pricing Supplement, as indicated herein.

     Section 5.02 Acknowledgment. Principal Life hereby acknowledges Section
2.10 of the Indenture and Section 6.1 of the Custodial Agreement. The Trust
hereby acknowledges and agrees to the terms of the Custodial Agreement.

     Section 5.03 Counterparts. This Coordination Agreement, through the
Omnibus Instrument, may be executed in any number of counterparts, each of
which counterparts shall be deemed to be an original, and all of which
counterparts shall constitute but one and the same instrument.

     Section 5.04 Capitalized Terms. All capitalized terms used herein and not
otherwise defined in this Coordination Agreement will have the meanings set
forth in the Indenture.

[Remainder of Page Intentionally Left Blank.]

E-5

 

SECTION F

MISCELLANEOUS AND EXECUTION PAGES

     This Omnibus Instrument may be executed by each of the parties hereto in any number of
counterparts, and by each of the parties hereto on separate counterparts, each of which
counterparts, when so executed and delivered, shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.

     Each signatory, by its execution hereof, does hereby become a party to each of the agreements
or indenture identified for such party as of the date specified in such agreements or indenture.

     IN WITNESS WHEREOF, the undersigned have executed this Omnibus Instrument with respect to the
Notes as of the date first written above.

	 	 	 	 	 	 	 
	 	 	PRINCIPAL LIFE INSURANCE COMPANY (in executing below
agrees and becomes a party to (i) the Terms Agreement
set forth in Section D herein and (ii) the Coordination
Agreement set forth in Section E herein)
	 
	 	 	 	 	 	 
	 	 	By:	 	/s/ Christopher P. Freese
	 	 	 	 	 
	 

	 	 	 	Name:
	 	Christopher P. Freese
	 

	 	 	 	Title:
	 	Officer
	 
	 	 	 	 	 	 
	 	 	PRINCIPAL FINANCIAL GROUP, INC. (in executing below
agrees and becomes a party to (i) the Terms Agreement
set forth in Section D herein and (ii) the Coordination
Agreement set forth in Section E herein)
	 
	 	 	 	 	 	 
	 	 	By:	 	/s/ Elizabeth D. Swanson
	 	 	 	 	 
	 

	 	 	 	Name:
	 	Elizabeth D. Swanson
	 

	 	 	 	Title:
	 	Counsel
	 
	 	 	 	 	 	 
	 	 	PRINCIPAL FINANCIAL SERVICES, INC. (in executing below
agrees and becomes a party to (i) the License Agreement
set forth in Section B herein and (ii) the Coordination
Agreement set forth in Section E herein)
	 
	 	 	 	 	 	 
	 	 	By:	 	/s/ Elizabeth D. Swanson
	 	 	 	 	 
	 

	 	 	 	Name:
	 	Elizabeth D. Swanson
	 

	 	 	 	Title:
	 	Counsel

[Execution Page 1 of 3]

 

 

	 	 	 	 	 	 	 
	 	 	THE PRINCIPAL LIFE INCOME FUNDINGS TRUST DESIGNATED IN
THIS OMNIBUS INSTRUMENT (in executing below agrees and
becomes a party to (i) the License Agreement set forth
in Section B herein, (ii) the Indenture set forth in
Section C herein, (iii) the Terms Agreement set forth
in Section D herein and (iv) the Coordination Agreement
set forth in Section E herein)
	 
	 	 	 	 	 	 
	 	 	By: U.S. Bank Trust National Association, not in its
individual capacity but solely in its capacity as
trustee of the Trust
	 
	 	 	 	 	 	 
	 	 	By:	 	/s/ Ward A. Spooner
	 	 	 	 	 
	 

	 	 	 	Name:
	 	Ward A. Spooner
	 

	 	 	 	Title:
	 	Vice President
	 
	 	 	 	 	 	 
	 	 	U.S. BANK TRUST NATIONAL ASSOCIATION (in executing
below agrees and becomes a party to the Trust Agreement
set forth in Section A herein), as Trustee
	 
	 	 	 	 	 	 
	 	 	By:	 	/s/ Ward A. Spooner
	 	 	 	 	 
	 

	 	 	 	Name:
	 	Ward A. Spooner
	 

	 	 	 	Title:
	 	Vice President
	 
	 	 	 	 	 	 
	 	 	GSS HOLDINGS II, INC. (in executing below agrees and
becomes a party to the Trust Agreement set forth in
Section A herein), as Trust Beneficial Owner
	 
	 	 	 	 	 	 
	 	 	By:	 	/s/ Bernard J. Angelo
	 	 	 	 	 
	 

	 	 	 	Name:
	 	Bernard J. Angelo
	 

	 	 	 	Title:
	 	Vice President
	 
	 	 	 	 	 	 
	 	 	CITIBANK, N.A. (in executing below agrees and becomes a
party to (i) the Indenture set forth in Section C
herein, as Indenture Trustee, Registrar, Transfer
Agent, Paying Agent and Calculation Agent and (ii) the
Coordination Agreement set forth in Section E herein),
as Indenture Trustee, Registrar, Transfer Agent, Paying
Agent and Calculation Agent
	 
	 	 	 	 	 	 
	 	 	By:	 	/s/ Nancy Forte
	 	 	 	 	 
	 

	 	 	 	Name:
	 	Nancy Forte
	 

	 	 	 	Title:
	 	Assistant Vice President

[Execution Page 2 of 3]

 

 

	 	 	 	 	 	 	 
	 	 	BANKERS TRUST COMPANY, N.A. (in executing below agrees
and becomes a party to the Coordination Agreement set
forth in Section E herein)
	 
	 	 	 	 	 	 
	 	 	By:	 	/s/ Patty Ashbaugh
	 	 	 	 	 
	 

	 	 	 	Name:
	 	Patty Ashbaugh
	 

	 	 	 	Title:
	 	Vice President
	 
	 	 	 	 	 	 
	 	 	MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED (in
executing below agrees and becomes a party to the Terms
Agreement set forth in Section D herein)
	 
	 	 	 	 	 	 
	 	 	By:	 	/s/ Diane Kenna
	 	 	 	 	 
	 

	 	 	 	Name:
	 	Diane Kenna
	 

	 	 	 	Title:
	 	Authorized Signatory

[Execution Page 3 of 3]

 

 

INDEX OF EXHIBITS AND SCHEDULES TO THE OMNIBUS INSTRUMENT

	 	 	 
	Exhibit A

	 	Standard Trust Terms – Incorporated herein by reference to Exhibit
4.6 to Principal Life Insurance Company’s and Principal Financial
Group, Inc.’s Registration Statement on Form S-3 (Registration
Nos. 333-110499 and 333-110499-01).
	 
	 	 
	Exhibit B

	 	Standard License Agreement Terms – Incorporated herein by
reference to Exhibit 99.1 to Principal Life Insurance Company’s
Current Report on Form 8-K, filed on March 29, 2004.
	 
	 	 
	Exhibit C

	 	Standard Indenture Terms – Incorporated herein by reference to
Exhibit 4.1 to Principal Life Insurance Company’s and Principal
Financial Group, Inc.’s Registration Statement on Form S-3
(Registration Nos. 333-110499 and 333-110499-01).
	 
	 	 
	Exhibit D

	 	Pricing Supplement – Incorporated herein by reference to the
Pricing Supplement with respect to Principal Life Income Fundings
Trust 2005-84, filed on August 22, 2005, with the Securities and
Exchange Commission pursuant to Rule 424(b)(5) under the
Securities Act of 1933, as amended.
	 
	 	 
	Exhibit E

	 	Principal Life Insurance Company Officer’s Certificate
	 
	 	 
	Exhibit F

	 	Principal Life Income Fundings Trusts Trustee Officer’s Certificate
	 
	 	 
	Schedule I

	 	Terms Agreement Specifications

 

 

EXHIBIT E

Principal Life Insurance Company

Officer’s Certificate

     The undersigned, an officer of Principal Life Insurance Company, an Iowa
stock life insurance company (“Principal Life”), does hereby certify to
Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies,
Inc., in such capacity and on behalf of Principal Life, to the knowledge of the
undersigned and after reasonable inquiry, that:

	 	 	 
	1.

	 	each of the representations and warranties of Principal Life
contained in each Expense and Indemnity Agreement entered into in
connection with the Registration Statement (defined below), and each
Funding Agreement issued in connection with the Program (the
“Specified Agreements”) (other than any representation or warranty
expressly made as of a date prior to the date hereof) are true and
correct on and as of the date hereof, with the same effect as though
such representation or warranty had been made on and as of the date
hereof;
	 
	2.

	 	no default under any of the Specified Agreements and no event
or any condition which, with notice or lapse of time or both, would
become a default, has occurred and is continuing as of the date
hereof;
	 
	3.

	 	Principal Life has performed and complied with, respectively,
in all material respects, all of the agreements, covenants,
obligations and conditions applicable to Principal Life required by
the Specified Agreements to be performed or complied with by
Principal Life on or before the date hereof;
	 
	4.

	 	the Registration Statement filed on Form S-3 (File Nos.
333-110499 and 333-110499-01) (the “Registration Statement”) by
Principal Life and Principal Financial Group, Inc. has been declared
effective by the Securities and Exchange Commission (the
“Commission”) under the Securities Act of 1933, as amended (the
“Act”) and no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been commenced by or are pending before or contemplated
by the Commission;
	 
	5.

	 	all filings, if any, required by Rule 424 and Rule 430A under
the Act have been made in a timely manner;
	 
	6.

	 	since
     , the Trusts organized in connection with the
program contemplated by the Registration Statement have issued the
following series of Notes:
	 
	

	 	[List each series of Notes.] [(collectively, the “Designated Notes”)]; and
	 
	7.

	 	the Funding Agreements issued in connection with the Designated
Notes have been executed and delivered by Principal Life in accordance
with the terms and conditions of the Program Documents.

E-1

 

          Capitalized terms used herein and not otherwise defined herein shall have the meanings set
forth in the Standard Indenture Terms attached as Exhibit 4.1 to the
Registration Statement.

     IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
the • day of •, 200•.

	 	 	 
	

	[Name], [in his/her] capacity as an
authorized officer of Principal Life
	 
	 	By:
	 
	 	 	

	

	 	Name:
	

	 	Title:

	 	 	 	 	 

E-2

 

EXHIBIT F

Principal Life Income Fundings Trusts

Trustee Officer’s Certificate

     U.S. Bank Trust National Association, not in its individual capacity but
solely in its capacity as trustee acting on behalf of each common law trust
organized under the laws of the State of New York (in such capacity, the
“Trustee,” and each such common law trust being referred to herein as, a
“Trust”) in connection with the program contemplated by Registration Statement
Nos. 333-110499 and 333-110499-01 filed on Form S-3 (the “Registration
Statement”) by Principal Life Insurance Company and Principal Financial Group,
Inc. with the Securities and Exchange Commission, does hereby certify to
Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies,
Inc., in such capacity and on behalf of each Trust, to the knowledge of the
Trustee, that:

	 	 	 
	1.

	 	each of the representations and warranties of each Trust
contained in the Notes issued in connection with the Program, each
Indenture entered into in connection with the Registration Statement
and the Expense and Indemnity Agreement concerning the Trusts (the
“Specified Agreements”) (other than any representation or warranty
expressly made as of a date prior to the date hereof) are true and
correct on and as of the date hereof, with the same effect as though
such representation or warranty had been made on and as of the date
hereof;
	 
	2.

	 	no default under any of the Specified Agreements and no event
or any condition which, with notice or lapse of time or both, would
become a default, has occurred and is continuing as of the date
hereof;
	 
	3.

	 	each Trust has performed and complied with, respectively, in
all material respects, all of the agreements, covenants, obligations
and conditions applicable to such Trust required by the Specified
Agreements to be performed or complied with by such Trust on or
before the date hereof;
	 
	4.

	 	the Notes issued in connection with the Program, have been
issued, in all material respects, in accordance with the terms and
conditions of the Program Documents; and
	 
	5.

	 	each Funding Agreement has been executed and delivered by the
related Trust in accordance with the terms and conditions of the
Program Documents.

     Capitalized terms used herein and not otherwise defined herein shall have
the meanings set forth in the Standard Indenture Terms attached as Exhibit 4.1
to the Registration Statement. In no event shall U.S. Bank Trust National
Association in its personal corporate capacity have any liability for any of
the certifications or statements contained in this Trustee Officer’s
Certificate, such liability being solely that of each Trust.

F-1

 

     IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
the • day of •, 200•.

	 	 	 
	

	 	U.S. Bank Trust National Association, not
in its capacity but solely in its capacity
as Trustee acting on behalf of each Trust
	 
	 	By:
	 
	 	 	

	

	 	Name:
	

	 	Title:

F-2

 

SCHEDULE I

Terms Agreement Specifications

      In connection with Section 3(a)(iv) of the Distribution Agreement, the Program under which the
Notes are issued is rated Aa2 by Moody’s Investors Service, Inc. (“Moody’s”) and AA by Standard &
Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc. (“S&P”). Principal Life and
PFG expect that the Notes will be rated Aa2 by Moody’s. The Company’s financial strength rating is
Aa2 by Moody’s and AA by S&P. All capitalized terms used herein and not otherwise defined herein
will have the meanings set forth in the Distribution Agreement.STOCK PURCHASE AGREEMENT

 

EXHIBIT 10.1

STOCK PURCHASE AGREEMENT

     This Stock Purchase Agreement (this “Agreement”) is made and entered into as of August 18,
2005, by NationsHealth, Inc., a Delaware corporation (the “Company”) US Bioservices Corporation, a
Delaware corporation (“Investor”).

     The parties hereby agree as follows:

     1. Purchase and Sale of Stock.

     1.1. Sale and Issuance of Stock. Subject to the terms and conditions of this
Agreement, Investor agrees to purchase, and the Company agrees to sell and issue to Investor, that
number of shares of the Company’s common stock, par value $0.0001 per share (“Common Stock”), equal
to (a) $1,500,000 divided by (b) the average closing price per share of Common Stock, as reported
by Nasdaq, for the twenty (20) consecutive trading days immediately prior to the Closing (as such
term is defined in Section 1.2).

     1.2. Closing. The purchase and sale of the shares of Common Stock that Investor is
purchasing (the “Shares”) shall take place at the offices of the Company, 13650 NW 8th
Street, Suite 109, Sunrise, Florida 33325 (the “Closing”). At the Closing, the Company shall
execute and deliver to Investor a certificate representing the Shares in exchange for the payment
of the Purchase Price, as provided in Section 1.3. At the Closing, the Company and
Investor shall also enter into the Registration Rights Agreement in the form of Exhibit 1
hereto (the “Rights Agreement”).

     1.3 Payment of Purchase Price. The Company hereby directs Investor to wire transfer
$1,500,000 (the “Purchase Price”), as consideration for the Shares, on account of the Company, to a
bank account in the name of NationsHealth Specialty Rx, LLC.

     2. Representations and Warranties of the Company. The Company hereby represents and
warrants to Investor that except as set forth in the Company SEC Documents (as defined below):

     2.1. Organization; Good Standing; Qualification. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of Delaware, has all
requisite corporate power and authority to own and operate its properties and assets and to carry
on its business as now conducted, to execute and deliver this Agreement and the Rights Agreement
(collectively, the “Agreements”), to issue and sell the Shares and to carry out the provisions of
the Agreements.

     2.2. Authorization. All corporate action on the part of the Company, its officers,
directors and stockholders necessary for the authorization, execution and delivery of the
Agreements, the performance of all obligations of the Company hereunder and thereunder and the
authorization, issuance, sale and delivery of the Shares being issued and sold hereunder has been
taken, and each of the Agreements has been duly and validly executed and delivered and constitutes
a valid and legally binding obligation of the Company, enforceable in accordance with its terms
except (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium and other
laws of general application affecting enforcement of creditors’ rights

 

 

generally, (b) as limited by laws relating to the availability of specific performance,
injunctive relief or other equitable remedies, and (c) to the extent the indemnification provisions
contained in the Rights Agreement may be limited by applicable federal or state securities laws.

     2.3. Valid Issuance of Shares. The Shares that are being purchased and acquired by
the Investor hereunder, when issued, sold and delivered by the Company in accordance with the terms
of this Agreement for the consideration expressed herein, will be duly and validly issued, fully
paid and nonassessable, and will be free of restrictions on transfer other than restrictions on
transfer under applicable state and federal securities laws, including containing the restrictive
legend set forth in Section3.7 hereof.

     2.4. Governmental Consents. No consent, approval, qualification, order or
authorization of, or filing with, any local, state or federal governmental authority is required on
the part of the Company in connection with its valid execution, delivery or performance of this
Agreement, the offer, sale or issuance of the Shares by the Company, except such filings as have
been made prior to the Closing, except that any notices of sale required to be filed with the
Securities and Exchange Commission under Regulation D of the Securities Act of 1933, as amended
(the “Securities Act”), or such post-closing filings as may be required under applicable federal or
state securities laws, which will be timely filed within the applicable periods therefor.

     2.5. Compliance With Other Instruments. The Company is not in violation of or default
under any provision of (a) its Second Amended Restated Certificate of Incorporation or Bylaws, (b)
any contract or agreement that is material to the conduct of the business of the Company, or (c)
any federal or state judgment, order, writ, decree, statute, rule or regulation applicable to the
Company. The execution, delivery and performance by the Company of the Agreements, and the
consummation of the transactions contemplated hereby and thereby, will not result in any violation
of or be in conflict with any such provision or constitute, with or without the passage of time or
giving of notice, either a default under any such provision or an event that results in the
creation of any material lien, charge or encumbrance upon any assets of the Company or the
suspension, revocation, impairment, forfeiture or nonrenewal of any permit, license, authorization
or approval applicable to the Company, its business or operations, or any of its assets or
properties.

     2.6. Litigation. There is no action, suit, proceeding or investigation pending or
currently threatened against the Company that questions the validity of the Agreements or the right
of the Company to enter into the Agreements, or to consummate the transactions contemplated hereby
or thereby, or that might result, either individually or in the aggregate, in any material adverse
change in the assets, business, properties, prospects or financial condition of the Company. There
is no order, writ, injunction, judgment or decree of any court, government agency or
instrumentality binding on the Company and having a material adverse effect on the Company.

     2.7 Disclosure. Neither this Agreement nor any other written statements or
certificates made or delivered in connection herewith contain any untrue statement of a material
fact or omits to state a material fact necessary to make the statements herein or therein not
misleading.

2

 

     2.8. Offering. Subject in part to the truth and accuracy of Investor’s
representations set forth in this Agreement, the offer, sale and issuance of the Shares as
contemplated by this Agreement are exempt from the registration requirements of the Securities Act,
and neither the Company nor any authorized agent acting on its behalf will take any action
hereafter that would cause the loss of such exemption.

     2.9. Financial Statements. The Company has furnished or made available to Investor
true and complete copies of all reports or registration statements it has filed with the Securities
and Exchange Commission (the “SEC”) under the Securities Act and the Securities Exchange Act of
1934, as amended (the “Exchange Act”), for all periods subsequent to September 1, 2004, all in the
form so filed (collectively, the “Company SEC Documents”). As of their respective filing dates,
the Company SEC Documents complied in all material respects with the requirements of the Securities
Act or the Exchange Act, as applicable, and, as of its respective filing date, no Company SEC
Document filed under the Exchange Act contained any untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to make the statements made
therein, in the light of the circumstances in which they were made, not misleading, except to the
extent corrected by a subsequently filed document with the SEC. No Company SEC Document filed
under the Securities Act contained an untrue statement of material fact or omitted to state a
material fact required to be stated therein or necessary to make the statements therein not
misleading at the time such Company SEC Documents became effective under the Securities Act. The
Company’s financial statements, including the notes thereto, included in the Company SEC Documents
(the “Financial Statements”) comply as to form in all material respects with applicable accounting
requirements and with the published rules and regulations of the SEC with respect thereto, have
been prepared in accordance with generally accepted accounting principles consistently applied
(“GAAP”) and present fairly the Company’s consolidated financial position at the dates thereof and
of its operations and cash flows for the periods specified (subject, in the case of unaudited
statements, to normal audit adjustments). Since the date of the most recent Company SEC Document,
the Company has not effected any change in any method of accounting or accounting practice, except
for any such change required because of a concurrent change in GAAP. Since May 16, 2005, (i) no
event has occurred that requires the filing of a Current Report on Form 8-K (an “8-K”) with the SEC
for which an 8-K has not been so filed and (ii) to the knowledge of the Company, there has not been
any event or condition of any character that has had or could reasonably be expected to have a
material adverse effect on (x) the assets, liabilities, results of operations, condition (financial
or otherwise) or business of the Company and its subsidiaries taken as a whole or (y) on the
ability of the Company to perform its obligations under this Agreement.

     2.10 No Undisclosed Liabilities. The Company has no liabilities (whether accrued,
absolute, contingent or otherwise, and whether due or to become due or asserted or unasserted),
except (a) liabilities provided for in the Financial Statements (other than liabilities which, in
accordance with GAAP, need not be disclosed), or (b) liabilities (including accounts payable)
incurred since May 16, 2005 in the ordinary course of business consistent with past practice.

3

 

     2.11. Disclosure Controls and Procedures.

     (a) The Company has established and maintains disclosure controls and procedures (as
such term is defined in Rules 13a-15 and 15d-15 under the Exchange Act) that (i) are designed to
ensure that material information relating to the Company, including its consolidated subsidiaries,
is made known to the Company’s Chief Executive Officer and its Chief Financial Officer by others
within those entities, particularly during the periods in which the filings made by the Company
with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act are being prepared, (ii)
have been evaluated for effectiveness as of March 31, 2005, and (iii) are effective to perform the
functions for which they were established; and

     (b) To the extent required by the Exchange Act as of the date hereof, the
independent registered public accountants and the Audit Committee of the Board of Directors (the
“Board”) of the Company have been advised of (i) any significant deficiencies in the design or
operation of internal controls which could adversely affect the Company’s ability to record,
process, summarize and report financial data and (ii) any fraud, whether or not material, that
involves management or other employees who have a role in the Company’s internal controls; any
material weaknesses in internal controls have been identified for the accountants; and since the
date of the most recent evaluation of such disclosure controls and procedures, there have been no
significant changes in internal controls or in other factors that could significantly affect
internal controls, including any corrective actions with regard to significant deficiencies and
material weaknesses.

     (c) The principal executive officer and principal financial officer of the Company
have made all certifications required by the Sarbanes-Oxley Act of 2002 and any related rules and
regulations promulgated by the SEC, each in effect on the date thereof, and the statements
contained in any such certification were complete and correct as of their respective dates. The
Company is otherwise in material compliance with all applicable provisions of the Sarbanes-Oxley
Act of 2002 that are effective and applicable to the Company as of the date hereof.

     2.12. Tax Returns, Payments and Elections. The Company has filed all tax returns and
reports as required by law. These returns and reports are true and correct in all material
respects. The Company has paid all taxes and other assessments due, except those contested by the
Company in good faith. The provision for taxes of the Company included in the provision for
accrued liabilities in the Financial Statements is adequate for taxes due or accrued as of the date
thereof. Neither the Company nor any of the Subsidiaries have elected pursuant to the Internal
Revenue Code of 1986, as amended (“Code”), to be treated as an S corporation or a collapsible
corporation pursuant to section 341(f) or section 1362(a) of the Code, nor have any of them made
any other elections pursuant to the Code (other than elections that relate solely to methods of
accounting, depreciation or amortization) that would have a material effect on the business,
properties, prospects or financial condition of the Company. The Company has never had any
material tax deficiency proposed or assessed against any of them and have not executed any waiver
of any statute of limitations on the assessment or collection of any tax or governmental charge.
Since the date of the Financial Statements, the Company has made adequate provisions on its books
of account for all taxes, assessments and governmental charges with respect to its business,
properties and operations for such period. The Company has withheld or collected from each payment
made to each of its employees, the amount of all taxes, including, but not

4

 

limited to, federal income taxes, Federal Insurance Contribution Act taxes and Federal
Unemployment Tax Act taxes required to be withheld or collected therefrom, and has paid the same to
the proper tax receiving officers or authorized depositaries.

     2.13. Brokers; Financial Advisors. No agent, broker, investment banker, finder,
financial advisor or other person or entity is or will be entitled to any broker’s or finder’s fee
or any other commission or similar fee from the Company, directly or indirectly, in connection with
the transactions contemplated by this Agreement.

     3. Representations and Warranties of Investor. Investor hereby represents and
warrants to the Company that:

     3.1. Authorization. Investor has full power and authority to enter into this
Agreement and that this Agreement constitutes a valid and legally binding obligation of Investor
(a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium and other laws of
general application affecting enforcement of creditors’ rights generally, and (b) as limited by
laws relating to the availability of specific performance, injunctive relief or other equitable
remedies.

     3.2. Purchase Entirely for Own Account. This Agreement is made with Investor in
reliance on Investor’s representation to the Company, which by its execution of this Agreement it
hereby confirms, that the Shares to be purchased by it will be purchased for investment for its own
account, not as a nominee or agent, and not with a view to the resale or distribution of any part
thereof, and that Investor has no present intention of selling, granting any participation in, or
otherwise distributing the Shares. By executing this Agreement, Investor further represents that
it does not have any contract, undertaking, agreement or arrangement with any person to sell,
transfer or grant participations to such person or to any third person, with respect to the Shares.

     3.3. Reliance Upon Investor’s Representations. Investor understands that Shares are
not registered under the Securities Act on the ground that the sale provided for in this Agreement
and the issuance of Shares hereunder is exempt from registration under the Securities Act pursuant
to section 4(2) thereof and/or Regulation D thereunder, and that the Company’s reliance on such
exemption is based on Investor’s representations set forth herein. Investor realizes that the
basis for the exemption may not be present if, notwithstanding such representations, Investor has
in mind merely purchasing the Shares for a fixed or determinable period in the future, or for a
market rise, or for sale if the market does not rise. Investor does not have any such intention.

     3.4. Receipt of Information. Investor has received all the information it considers
necessary or appropriate for deciding whether to purchase the Shares. Investor further represents
that it has had an opportunity to ask questions and receive answers from the Company regarding the
terms and conditions of the offering of the Shares, the business, properties, prospects and
financial condition of the Company and to obtain additional information (to the extent the Company
possessed such information or could acquire it without unreasonable effort or expense) necessary to
verify the accuracy of any information furnished to it or to which it had access. The foregoing,
however, does not limit or modify the representations and warranties of the Company in Section
2 of this Agreement or the right of Investor to rely thereon.

5

 

     3.5. Investment Experience. Investor is experienced in evaluating and investing in
securities, of companies in the development stage and acknowledges that it is able to fend for
itself, can bear the economic risk of its investment, and has such knowledge and experience in
financial and business matters that it is capable of evaluating the merits and risks of the
investment in the Shares. Investor also represents it has not been organized for the purpose of
purchasing the Shares.

     3.6. Accredited Investor. Investor is an accredited investor, as such term is defined
in Regulation D under the Securities Act.

     3.7. Restricted Securities. Investor understands that the Shares may not be sold,
transferred or otherwise disposed of without registration under the Securities Act or an exemption
therefrom, and that in the absence of an effective registration statement covering the Shares or an
available exemption from registration under the Securities Act, the Shares must be held
indefinitely.

     3.8. Legends. The certificate evidencing the Shares shall be endorsed with the legend
substantially in the form set forth below, and Investor covenants that, except to the extent such
restrictions are waived by the Company, Investor shall not transfer the securities represented by
any such certificate without complying with the restrictions on transfer described in the legend
endorsed on such certificate or other document:

     “THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER
THE SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY STATE, AND MAY BE OFFERED AND SOLD ONLY IF
REGISTERED AND QUALIFIED PURSUANT TO THE RELEVANT PROVISIONS OF FEDERAL AND STATE SECURITIES LAWS
OR IF THE COMPANY IS PROVIDED AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION
AND QUALIFICATION UNDER FEDERAL AND STATE SECURITIES LAWS IS NOT REQUIRED.”

     4. Deliveries at Closing. At the Closing, the Company shall execute and deliver to
Investor:

     (a) A certificate evidencing the Shares;

     (b) The Rights Agreement; and

     (c) A corporate certificate (i) certifying as to and attaching a copy of the certificate of
incorporation, as amended, of the Company, (ii) certifying as to resolutions of the Board of
Directors of the Company with respect to the transactions contemplated by this Agreement, (iii)
attaching a copy of a certificate of good standing for the Company as issued by the Secretary of
State of the State of Delaware, and (iv) certifying as to the incumbency and signature of the
officers of the Company signing the certificate and the Agreements. At the Closing, Investor shall
pay the purchase price for the Shares in accordance with Section 1.3 and execute and
deliver to the Company the Rights Agreement.

6

 

     6. Miscellaneous.

     6.1. Survival of Warranties. The warranties, representations and covenants of the
Company and Investor contained in this Agreement shall survive the execution and delivery of this
Agreement and the Closing.

     6.2. Notices. Except as expressly set forth to the contrary in this Agreement, all
notices, requests, or consents provided for or permitted to be given under this Agreement must be
in writing and must be given either by depositing that writing in the United States mail, addressed
to the recipient, postage paid, and registered or certified with return receipt requested or by
delivering that writing to the recipient in person, by overnight delivery or courier, or by
facsimile transmission; and a notice, request, or consent given under this Agreement is effective
on receipt by the party to receive it. All notices, requests, and consents to be sent to a party
must be sent to or made at the address previously given by that party or such other address as that
party may specify by notice to the other party. Any notice, request, or consent must be given at
the following addresses:

	 	 	 
	If to the Company:

	 	NationsHealth, Inc.

Attn: Chief Executive Officer

13650 NW 8th Street

Suite 109

Sunrise, FL 33325
	 
	 	 
	with a copy to:

	 	Ira J. Coleman, Esq.

McDermott Will & Emery

201 South Biscayne Boulevard

22nd Floor

Miami, FL 33131
	 
	 	 
	If to Investor:

	 	US Bioservices Corporation

Attn: President

309 Henderson Drive

Sharon Hill, PA 19079
	 
	 	 
	with a copy to:

	 	AmerisourceBergen Corporation

Attn: General Counsel

1300 Morris Drive, Suite 100

Chesterbrook, PA 19087

Whenever any notice is required to be given by law or this Agreement, a written waiver thereof,
signed by the party entitled to notice, whether before or after the time stated therein, shall be
deemed equivalent to the giving of such notice.

     6.3. Entire Agreement. Each of the parties agrees that this Agreement, including the
other documents referred to herein, (i) constitutes the entire agreement and supersedes all prior
and contemporaneous agreements, understandings, negotiations and discussions, whether oral or
written, among the parties with respect to the subject matter of this Agreement, and (ii) is not

7

 

intended to confer any rights or remedies, or impose any obligations, on any person other than
the parties hereto. Each of the parties expressly agrees and acknowledges that, other than those
statements expressly set forth in this Agreement, it is not relying on any statement, whether oral
or written, of any person or entity with respect to its entry into this Agreement or to the
consummation of the transactions contemplated by this Agreement.

     6.4. Effect of Waiver or Consent. A waiver or consent, express or implied, to or of
any breach or default by any party in the performance by that party of its obligations is not a
consent or waiver to or of any other breach or default in the performance by that party of any
other obligations of that party. Failure on the part of a party to complain of any act of any
party or to declare any party in default, irrespective of how long that failure continues, does not
constitute a waiver by that party of its rights with respect to that default until the applicable
statute of limitations period has run.

     6.5. Amendment or Modification. This Agreement may be amended or modified from time
to time only by a written instrument executed by the Company and Investor.

     6.6. Successors and Assigns. Except as otherwise specifically provided, this
Agreement shall be binding upon and inure to the benefit of the parties and their respective
successors and permitted assigns.

     6.7. Governing Law. This Agreement is governed by and shall be construed in
accordance with the law of the State of Delaware, excluding any conflict of laws rule or principle
that might refer the governance or the construction of this Agreement to the law of another
jurisdiction.

     6.8. Illegal or Invalid Provisions. If any provision of this Agreement is held to be
illegal, invalid, or unenforceable under present or future laws, such provision shall be fully
severable. This Agreement shall be construed and enforced as if such illegal, invalid, or
unenforceable provision had never comprised a part of this Agreement, and the remaining provisions
of this Agreement shall remain in full force and effect and shall not be affected by the illegal,
invalid, or unenforceable provision or by its severance from this Agreement. Furthermore, in lieu
of each such illegal, invalid, or unenforceable provision, there shall be added automatically, as a
part of this Agreement, a provision as similar in terms to such illegal, invalid, or unenforceable
provision as may be possible and be legal, valid and enforceable.

     6.9. Further Assurances. In connection with this Agreement and the transactions
contemplated hereby, each party shall execute and deliver any additional documents and instruments
and perform any additional acts that may be necessary or appropriate to effectuate and perform the
provisions of this Agreement and those transactions.

     6.10. Expenses. Irrespective of whether the Closing is effected, the Company and
Investor shall each pay all costs and expenses that it incurs with respect to the negotiation,
execution, delivery and performance of this Agreement.

     6.11. Attorneys’ Fees. If any action at law or in equity is necessary to enforce or
interpret the terms of this Agreement, the prevailing party shall be entitled to reasonable

8

 

attorneys’ fees, costs and disbursements in addition to any other relief to which such party
may be entitled.

     6.12. Finder’s Fee. The Company agrees to indemnify and hold harmless Investor from
any liability for any commission or compensation in the nature of a finder’s fee (and the costs and
expenses of defending against such liability or asserted liability) for which the Company or any of
its officers, employees or representatives is responsible.

     6.13. Counterparts. This Agreement may be executed in any number of counterparts with
the same effect as if all signing parties had signed the same document. All counterparts shall be
construed together and constitute the same instrument.

     IN WITNESS WHEREOF, the undersigned have executed this Agreement effective as of the Closing.

	 	 	 	 	 
	US Bioservices Corporation 

 	 
	By:  	/s/ Mike Mullen
 	 
	 	Name:  	Mike Mullen                                  	 
	 	Title:  	President 	 
	 

	 	 	 	 	 
	NationsHealth, Inc.

 	 
	By:  	/s/ Glenn M. Parker
 	 
	 	Name:  	Glenn M. Parker 	 
	 	Title:  	CEO 	 
	 

9

 

Exhibit 1

Registration Rights Agreement

10

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