FORM OF SEPARATION AND DISTRIBUTION AGREEMENTDistribution Agreement |
|
|
You are currently viewing: This Distribution Agreement involves
AMERIPRISE FINANCIAL INC | AMERICAN EXPRESS COMPANY. RealDealDocs™ contains millions of easily searchable legal documents and clauses from top law firms. Search for free - click here. |
|
|
|
|
i
ii
iii This SEPARATION AND DISTRIBUTION AGREEMENT (this " Agreement "), dated as of August 24, 2005, by and between American Express Company, a New York corporation (" AXP "), and Ameriprise Financial, Inc., a Delaware corporation and a wholly owned subsidiary of AXP (" Ameriprise ", and, together with AXP, each, a " Party " and collectively, the " Parties "). WHEREAS, the Board of Directors of AXP has determined that it is in the best interests of AXP to separate the Ameriprise Business (as defined below) and the AXP Business (as defined below) into two independent public companies (the " Separation "), on the terms and subject to the conditions set forth in this Agreement, in order to resolve issues related to the allocation of capital and management resources between the Ameriprise Business and the AXP Business, and to give Ameriprise greater flexibility to manage, invest in, and expand the Ameriprise Business while ensuring that AXP can focus its time and resources on the development of the AXP Business; WHEREAS, to effect the Separation, AXP intends to make the Contribution (as defined below); WHEREAS, to further effect the Separation, Ameriprise intends to retain ownership and possession of all Ameriprise Assets (as defined below) and AXP intends to retain ownership and possession of all AXP Assets (as defined below); WHEREAS, to further effect the Separation, Ameriprise intends to remain solely liable for all Ameriprise Liabilities (as defined below) and AXP intends to remain solely liable for all AXP Liabilities (as defined below); WHEREAS, AXP intends to distribute on a pro rata basis to holders of issued and outstanding shares of common stock, par value $0.20 per share, of AXP (" AXP Common Stock "), other than shares of AXP Common Stock held in the treasury of AXP, all of the issued and outstanding shares of Ameriprise Common Stock, par value $0.01 per share, (" Ameriprise Common Stock ") beneficially owned by AXP, by means of a dividend of such Ameriprise Common Stock to such shareholders (the " Distribution "), on the terms and subject to the conditions set forth in this Agreement; WHEREAS, it is the intention of the Parties that, for United States federal income tax purposes, the Separation, Contribution and Distribution and the other transactions contemplated herein shall qualify as transactions that are generally tax-free within the meaning of Section 355 (and other related provisions) of the U.S. Internal Revenue Code of 1986, as amended (the " Code "); WHEREAS, the Board of Directors of AXP has (i) determined that the Separation, the Contribution, the Distribution and the other transactions contemplated by this Agreement and the Ancillary Agreements (as defined below) are in furtherance of and consistent with its business strategy and are in the best interests of AXP and (ii) approved this Agreement and each of the Ancillary Agreements; and WHEREAS, it is appropriate and desirable to set forth the principal corporate transactions required to effect the Separation, the Contribution and the Distribution and certain other agreements that will govern certain matters relating to these transactions and the relationship of AXP and Ameriprise and their respective Subsidiaries following the Distribution. NOW, THEREFORE, in consideration of the premises, and of the representations, warranties, covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and intending to be legally bound hereby, the Parties hereby agree as follows: SECTION 1.01. Definitions . As used in this Agreement, the following terms shall have the meanings set forth below: " Action " means any claim, demand, action, cause of action, suit, countersuit, arbitration, litigation, inquiry, proceeding or investigation by or before any Governmental Authority or any arbitration or mediation tribunal or authority. " AEIDC " means American Express International Deposit Company, a Cayman Islands company. " Affiliate " means, with respect to any specified Person, any other Person that directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with, such specified Person; provided , however , that for purposes of this Agreement, no member of either Group shall be deemed to be an Affiliate of any member of the other Group. As used herein, "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such entity, whether through ownership of voting securities or other interests, by contract or otherwise. " Agreement " has the meaning assigned to such term in the Preamble hereto. " Amended and Restated Bylaws " means the Amended and Restated Bylaws of Ameriprise substantially in the form of Exhibit A hereto, with such changes as may be agreed to by the Parties. " Amended and Restated Certificate of Incorporation " means the Amended and Restated Certificate of Incorporation of Ameriprise substantially in the form of Exhibit B hereto, with such changes as may be agreed to by the Parties. " Ameriprise " has the meaning assigned to such term in the Preamble hereto. " Ameriprise Assets " means, without duplication: (i) all of the outstanding shares of all classes of capital stock of Ameriprise Subsidiaries owned (either of record or beneficially) by Ameriprise, as of the Effective Time; (ii) all of the Assets included on the unaudited interim consolidated balance sheet of Ameriprise, including the notes thereto, as of March 31, 2005 (the " Balance Sheet ") to the extent such Assets would have been included as Assets on a consolidated balance sheet of Ameriprise, and the notes thereto, as of the Effective Time (were such balance sheet and notes to be prepared) on a basis consistent with the determination of Assets included on the Balance Sheet; (iii) all other Assets that are of a nature or type that would have resulted in such Assets being included as Assets on a consolidated balance sheet of Ameriprise, and the notes thereto, as of the Effective Time (were such balance sheet and notes to be prepared) on a basis consistent with the determination of Assets included on the Balance Sheet; (iv) the Assets expressly contributed, assigned, transferred, conveyed or delivered to Ameriprise pursuant to the Ancillary Agreements; (v) the Contribution; (vi) the contract rights, licenses, Trade Secrets, know-how, and any other rights and Intellectual Property, and any other rights, claims or properties (including any and all rights as an insured party under any AXP insurance policy), in each case of Ameriprise and as of the Effective Time; and 2 (vii) all other Assets that are held by Ameriprise and that are used or held primarily for use in or necessary to the operation of the Ameriprise Business. " Ameriprise Business " means the business and operations conducted by the Ameriprise Group from time to time, whether prior to, at or after the Effective Time, including the business and operations conducted by the Ameriprise Group, as more fully described in the Information Statement; provided that " Ameriprise Business " shall not include AMEX Assurance. " Ameriprise Common Stock " has the meaning assigned to such term in the Recitals hereto. " Ameriprise Group " means Ameriprise and each of its Subsidiaries and Affiliates and any corporation or entity that may become part of such Group from time to time. " Ameriprise Indemnified Parties " has the meaning assigned to such term in Section 4.03. " Ameriprise Liabilities " means, without duplication: (i) all outstanding Liabilities included on the Balance Sheet, to the extent such Liabilities would have been included on a consolidated balance sheet of Ameriprise, and the notes thereto, as of the Effective Time (were such balance sheet and notes to be prepared) on a basis consistent with the determination of Liabilities included on the Balance Sheet; (ii) all other Liabilities that are of a nature or type that would have resulted in such Liabilities being included as Liabilities on a consolidated balance sheet of Ameriprise, and the notes thereto, as of the Effective Time (were such balance sheet and notes to be prepared) on a basis consistent with the determination of Liabilities included on the Balance Sheet; (iii) all Liabilities expressly assumed by Ameriprise pursuant to the Ancillary Agreements; and (iv) all Liabilities to the extent relating to, arising out of or resulting from actions, inactions, events, omissions, conditions, facts or circumstances occurring or existing prior to, at or after the Effective Time, in each case to the extent such Liabilities relate to, arise out of or result from any Ameriprise Asset or the Ameriprise Business. " AMEX Assurance " means AMEX Assurance Company, an Illinois stock insurance company. " Amexco " means Amexco Insurance Company, a Vermont insurance company. " Ancillary Agreements " means the Employee Benefits Agreement, the Marketing and Branding Agreement, the Intellectual Property License and Transfer Agreement, the FSB Purchase and Assumption Agreement, the Transition Services Agreements, the Tax Allocation Agreement and the Reinsurance and Purchase Agreements. " Asset " means any right, property or asset, whether real, personal or mixed, tangible or intangible, of any kind, nature and description, whether accrued, contingent or otherwise, and wheresoever situated and whether or not carried or reflected, or required to be carried or reflected, on the books of any Person. " AXP " has the meaning assigned to such term in the Preamble hereto. " AXP Assets " means all Assets of the AXP Group, other than the Ameriprise Assets. " AXP Business " means all businesses and operations of the AXP Group, other than the Ameriprise Business. " AXP Common Stock " has the meaning assigned to such term in the Recitals hereto. " AXP Group " means AXP and each of its Affiliates and Subsidiaries, and any corporation or entity that may become part of such Group from time to time, other than the Ameriprise Group. " AXP Indemnified Parties " has the meaning assigned to such term in Section 4.02. " AXP Liabilities " means those Liabilities of AXP, other than the Ameriprise Liabilities. 3 " Business " means the Ameriprise Business and/or the AXP Business, as the context requires. " Code " has the meaning assigned to such term in the Recitals hereto. " Consents " means any consents, waivers, notices, reports or other filings to be made, or any registrations, licenses, permits, authorizations to be obtained from, or approvals from, or notification requirements to, any third parties, including any Governmental Authority. " Contribution " means a contribution of capital in an amount equal to one billion sixty-five million dollars ($1,065,000,000). " Delayed Transfer Asset and/or Liability " has the meaning assigned to such term in Section 2.03(b). " Dispute Escalation Notice " has the meaning assigned to such term in Section 9.08. " Distribution " has the meaning assigned to such term in the Recitals hereto. " Distribution Agent " means The Bank of New York. " Distribution Agent Agreement " has the meaning assigned to such term in Section 3.01(b). " D&O/Fid. Claims " shall have the meaning assigned to such term in Section 5.05(e). " D&O/Fid. Insurers " shall have the meaning assigned to such term in Section 5.05(e). " D&O/Fid. Policies " shall have the meaning assigned to such term in Section 5.05(e). " Distribution Date " means the date on which the Distribution shall be effected, such date to be determined by, or under the authority of, the Board of Directors of AXP in its sole and absolute discretion. " Effective Time " means the time at which the Distribution occurs on the Distribution Date. " Employee Benefits Agreement " means the employee benefits agreement to be entered into by and between AXP and Ameriprise, substantially in the form of Exhibit C hereto, with such changes as may be agreed to by the Parties. " Exchange Act " means the United States Securities Exchange Act of 1934, as amended, together with the rules and regulations promulgated thereunder. " FIFO Basis " means, with respect to the payment of Unrelated Claims pursuant to the same AXP insurance policy, the payment in full of each successful claim (regardless of whether AXP or Ameriprise is the claimant) in the order in which such successful claim is approved by the insurance carrier, until the limit of the applicable AXP insurance policy is met. " FSB Purchase and Assumption Agreement " means the FSB purchase and assumption agreement to be entered into between AXP and Ameriprise, substantially in the form attached hereto as Exhibit D , with such changes as may be agreed to by the Parties. " Governmental Authority " means any federal, state, local, foreign or international court, government, department, commission, board, bureau or agency, or any other regulatory, self-regulatory, administrative or governmental organization or authority, including the NYSE. " Group " means the AXP Group and/or the Ameriprise Group, as the context requires. " Indemnified Party " has the meaning assigned to such term in Section 4.03. " Indemnifying Party " means Ameriprise, for any indemnification obligation arising under Section 4.02, and AXP, for any indemnification obligation arising under Section 4.03. " Information " means all information, whether or not patentable or copyrightable, in written, oral, electronic or other tangible or intangible forms, stored in any medium, including non-public financial information, studies, reports, records, books, accountants' work papers, contracts, instruments, surveys, 4 discoveries, ideas, concepts, know-how, techniques, designs, specifications, drawings, blueprints, diagrams, models, prototypes, samples, flow charts, data, computer data, disks, diskettes, tapes, computer programs or other Software, marketing plans, customer data, communications by or to attorneys, memos and other materials prepared by attorneys and accountants or under their direction (including attorney work product), and other technical, financial, legal, employee or business information or data. " Information Statement " means the information statement and any related documentation to be distributed to holders of AXP Common Stock in connection with the Distribution, including any amendments or supplements thereto. " Insurer " has the meaning assigned to such term in Section 5.05(d). " Intellectual Property " means all intellectual property and other similar proprietary rights in any jurisdiction, whether owned or held for use under license, whether registered or unregistered, including such rights in and to: (i) trademarks, trade dress, service marks, certification marks, logos, and trade names, and the goodwill associated with the foregoing (collectively, " Trademarks "); (ii) patents and patent applications, and any and all divisions, continuations, continuations-in-part, reissues, continuing patent applications, reexaminations, and extensions thereof, any counterparts claiming priority therefrom, utility models, patents of importation/confirmation, certificates of invention, certificates of registration, design registrations or patents and like rights (collectively, " Patents "); inventions, invention disclosures, discoveries and improvements, whether or not patentable; (iii) writings and other works of authorship (" Copyrights "); (iv) trade secrets (including, those trade secrets defined in the Uniform Trade Secrets Act and under corresponding foreign statutory Law and common law), Information, business, technical and know-how information, business processes, non-public information, proprietary information and confidential information and rights to limit the use or disclosure thereof by any Person (collectively, " Trade Secrets "); (v) software, including data files, source code, object code, application programming interfaces, databases and other software-related specifications and documentation (collectively, " Software "); (vi) domain names and uniform resource locators; (vii) moral rights; (viii) privacy and publicity rights; (ix) any and all technical information, Software, specifications, drawings, records, documentation, works of authorship or other creative works, ideas, knowledge, invention disclosures or other data, not including works subject to Copyright, Patent or Trademark protection (" Technology "); (x) advertising and promotional materials, whether or not copyrightable; and (xi) claims, causes of action and defenses relating to the enforcement of any of the foregoing; in each case, including any registrations of, applications to register, and renewals and extensions of, any of the foregoing with or by any Governmental Authority in any jurisdiction. " Intellectual Property License and Transfer Agreement " means the intellectual property license and transfer agreement to be entered into between AXP and Ameriprise, substantially in the form attached hereto as Exhibit E , with such changes as may be agreed to by the Parties. " Inter-Group Indebtedness " means any intercompany receivables, payables, accounts, advances, loans, guarantees, commitments and indebtedness for borrowed funds between a member of the AXP Group and a member of the Ameriprise Group; provided , that "Inter-Group Indebtedness" shall not include any contingent Liabilities and accounts payable arising pursuant to the Ancillary Agreements, any agreements with respect to continuing transactions between AXP and Ameriprise and any other agreements entered into in the ordinary course of business. " Law " means any applicable foreign, federal, national, state, provincial or local law (including common law), statute, ordinance, rule, regulation, code or other requirement enacted, promulgated, issued or entered into, or act taken, by a Governmental Authority. " Liabilities " means all debts, liabilities, obligations, responsibilities, response actions, Losses, damages (whether compensatory, punitive, consequential, treble or other), fines, penalties and sanctions, absolute or contingent, matured or unmatured, liquidated or unliquidated, foreseen or 5 unforeseen, on- or off-balance sheet, joint, several or individual, asserted or unasserted, accrued or unaccrued, known or unknown, whenever arising, including those arising under or in connection with any Law, or other pronouncements of Governmental Authorities constituting an Action, order or consent decree of any Governmental Authority or any award of any arbitration tribunal, and those arising under any contract, guarantee, commitment or undertaking, whether sought to be imposed by a Governmental Authority, private party, or a Party, whether based in contract, tort, implied or express warranty, strict liability, criminal or civil statute, or otherwise, and including any costs, expenses, interest, attorneys' fees, disbursements and expense of counsel, expert and consulting fees, fees of third party administrators, and costs related thereto or to the investigation or defense thereof. " Loss " means any claim, demand, complaint, damages, loss, liability, cost or expense arising out of, relating to or in connection with any Action. " Marketing and Branding Agreement " means the marketing and branding agreement to be entered into between AXP and Ameriprise, substantially in the form attached hereto as Exhibit F , with such changes as may be agreed to by the Parties. " Mixed Account " has the meaning assigned to such term in Section 2.03(g)(ii). " Mixed Contract " has the meaning assigned to such term in Section 2.03(g)(i). " NYSE " means the New York Stock Exchange, Inc. " Parties " has the meaning assigned to such term in the Preamble hereto. " Person " means any natural person, corporation, general or limited partnership, limited liability company or partnership, joint stock company, joint venture, association, trust, bank, trust company, land trust, business trust or other organization, whether or not a legal entity, and any Governmental Authority. " Policies " has the meaning assigned to such term in Section 5.05(d). " Recapitalization " has the meaning assigned to such term in Section 2.01(a). " Record Date " means the date to be determined by the Board of Directors of AXP as the record date for determining shareholders of AXP entitled to receive shares of Ameriprise Common Stock pursuant to the Distribution. " Registration Statement " means the Registration Statement on Form 10 of Ameriprise relating to the registration under the Exchange Act of Ameriprise Common Stock, including any amendments or supplements thereto. " Reimbursable Expenses " means the costs and expenses incurred by AXP or Ameriprise, as the case may be, that are set forth on Schedule 9.02 hereof. " Reimbursing Party " has the meaning assigned to such term in Section 9.02. " Reinsurance and Purchase Agreements " means the (i) reinsurance agreement to be entered into by and between Amexco and AMEX Assurance and (ii) the share purchase agreement to be entered into by and between Ameriprise, IDS Property Casualty Insurance Company and American Express Travel Related Services Company, Inc., in each case, substantially in the forms attached hereto as Exhibit G , with such changes as may be agreed to by the parties thereto. " Related Claims " means a claim or claims against an AXP insurance policy made by each of AXP and/or its insured parties, on the one hand, or Ameriprise and/or its insured parties, on the other hand, filed in connection with Losses suffered by each of AXP and Ameriprise arising out of the same underlying transaction, transactions, event or events. " Release " has the meaning assigned to such term in Section 5.05(d). 6 " SEC " means the United States Securities and Exchange Commission. " Separation " has the meaning assigned to such term in the Recitals hereto. " Shared Employee " has the meaning assigned to such term in Section 2.03(h). " SOX " means the Sarbanes-Oxley Act of 2002, as amended from time to time. " Subsidiary " means, with respect to any Person, any other Person of which a Person (either alone or through or together with any other Subsidiary of such Person) owns, directly or indirectly, a majority of the stock or other equity interests the holders of which are generally entitled to vote for the election of the board of directors or other governing body of such corporation or other legal entity. " Tax Allocation Agreement " means the tax allocation agreement to be entered into by and between AXP and Ameriprise, substantially in the form attached hereto as Exhibit H , with such changes as may be agreed to by the Parties. " Third-Party Claim " has the meaning assigned to such term in Section 4.05(a). " Transition Services Agreements " means (i) the transition services agreement to be entered into by and between AXP and Ameriprise, (ii) the Transition Banking Services Agreement for Ameriprise One Financial Account and Direct Banking to be entered into by and between American Express Bank, FSB and Ameriprise, and (iii) the Transition Banking Services Agreement for Personal Trust Services to be entered into by and between American Express Bank, FSB and Ameriprise, in each case, substantially in the forms attached hereto as Exhibit I , with such changes as may be agreed to by the Parties. " Unrelated Claims " means a claim or claims against an AXP insurance policy made by each of AXP and/or its insured parties, on the one hand, or Ameriprise and/or its insured parties, on the other hand, filed in connection with Losses suffered by each of AXP and Ameriprise arising out of unrelated and separate transactions or events. SECTION 1.02. General Interpretive Principles . (a) Words in the singular shall include the plural and vice versa, and words of one gender shall include the other gender, in each case, as the context requires, (b) the words "hereof," "herein," "hereunder," and "herewith" and words of similar import shall, unless otherwise stated, be construed to refer to this Agreement and not to any particular provision of this Agreement, and references to Article, Section, paragraph, exhibit and schedule are references to the Articles, Sections, paragraphs, exhibits and schedules to this Agreement unless otherwise specified, (c) the word "including" and words of similar import when used in this Agreement shall mean "including, without limitation," unless otherwise specified and (d) any reference to any federal, state, local or non-U.S. statute or Law shall be deemed to also refer to all rules and regulations promulgated thereunder, unless the context otherwise requires. SECTION 2.01. Recapitalization and Other Transactions . On or prior to the Distribution Date, and subject to satisfaction or waiver of the conditions set forth in Section 2.04: (a) the Ameriprise Common Stock shall be recapitalized (the " Recapitalization ") such that the number of shares of Ameriprise Common Stock issued and outstanding and owned by AXP immediately prior to the Effective Time shall be in an amount calculated on the basis of the following: one (1) share of Ameriprise Common Stock shall equal five (5) shares of AXP Common Stock issued 7 and outstanding immediately prior to the Distribution. Such Ameriprise Common Stock owned by AXP will constitute all of the issued and outstanding capital stock of Ameriprise; and (b) Ameriprise shall enter into a bridge loan facility with a third-party creditor or third-party creditors, in form and substance acceptable to AXP, which (i) shall be for the account of Ameriprise, (ii) shall be deemed to constitute an Ameriprise Liability and (iii) shall be used by Ameriprise for the purpose of satisfying those obligations set forth in Section 2.03(e). SECTION 2.02. Contribution . On or prior to the Distribution Date and subject to the satisfaction or waiver of the conditions set forth in Section 2.04, AXP shall make the Contribution to Ameriprise. SECTION 2.03. The Separation and Related Transactions . (a) (i) The Parties acknowledge that the Separation, subject to the terms and conditions hereof and of the Ancillary Agreements, will result in (A) Ameriprise directly or indirectly operating the Ameriprise Group and the Ameriprise Business, continuing to own the Ameriprise Assets and retaining and continuing to be liable for the Ameriprise Liabilities and (B) AXP directly or indirectly operating the AXP Group and the AXP Business, continuing to own the AXP Assets and retaining and continuing to be liable for the AXP Liabilities. (ii) Pursuant to the Separation, Ameriprise, or a member of the Ameriprise Group, shall remain and be the sole owner, and shall have exclusive right, title and interest in and to, all Ameriprise Assets. Concurrently therewith, Ameriprise shall remain solely liable for and shall faithfully perform, fulfill and discharge fully in due course all of the Ameriprise Liabilities in accordance with their respective terms. Pursuant to the Separation, AXP, or a member of the AXP Group, shall remain the sole owner, and shall have exclusive right, title and interest in and to, all AXP Assets. Concurrently therewith, AXP shall remain and be solely liable for and shall faithfully perform, fulfill and discharge fully in due course all of the AXP Liabilities in accordance with their respective terms. From and after the Effective Time, Ameriprise or a member of the Ameriprise Group shall be solely responsible for all Ameriprise Liabilities and AXP or a member of the AXP Group shall be solely responsible for all AXP Liabilities, regardless of when or where such Liabilities arose or arise, or whether the facts on which they are based occurred prior to, on or subsequent to the Distribution Date, regardless of where or against whom such Liabilities are asserted or determined (including any Liabilities arising out of claims made by AXP's or Ameriprise's respective directors, officers, employees, agents, Subsidiaries or Affiliates against any member of the AXP Group or the Ameriprise Group, as the case may be) or whether asserted or determined prior to the date hereof, and regardless of whether arising from or alleged to arise from negligence, recklessness, violation of Law, fraud or misrepresentation by any member of the AXP Group or the Ameriprise Group or any of their respective directors, officers, employees, agents, Subsidiaries or Affiliates, as the case may be. Notwithstanding anything herein to the contrary, this Section 2.03(a)(ii) shall not apply to any Assets or Liabilities contributed, assigned, transferred, conveyed, delivered and/or assumed under any Ancillary Agreement, which shall be governed by the terms thereof. (iii) Subject to any Ancillary Agreement and to the extent that prior to the Effective Time, (A) AXP owns or is in possession of any Ameriprise Asset or Ameriprise owns or is in possession of any AXP Asset or (B) AXP is liable to any third party for any Ameriprise Liability or Ameriprise is liable to any third party for any AXP Liability, AXP and Ameriprise shall, and shall cause the respective members of their Groups to, cooperate and use their respective reasonable best efforts to obtain the necessary Consents to, and shall, contribute, assign, transfer, convey and/or deliver any AXP Asset or Ameriprise Asset, as the case may be, and/or assume any AXP Liability or Ameriprise Liability, as the case may be, such that, on or prior to the Effective Time, Ameriprise or a member of the Ameriprise Group owns and is in possession of the Ameriprise 8 Assets and is solely liable for the Ameriprise Liabilities and AXP or a member of the AXP Group owns and is in possession of the AXP Assets and is solely liable for the AXP Liabilities. (b) Delayed Transfer of Assets and/or Liabilities . To the extent that any contribution, assignment, transfer, conveyance, delivery or assumption required pursuant to Section 2.03 shall not have been consummated as of the Effective Time, whether by its terms or by operation of Law (any such Asset and/or Liability, a " Delayed Transfer Asset and/or Liability ") and subject to any Ancillary Agreement: (i) AXP and Ameriprise thereafter shall, and shall cause the members of their respective Groups to, use reasonable best efforts and cooperate to effect such contribution, assignment, transfer, conveyance, delivery or assumption as promptly following the Effective Time as shall be practicable; (ii) AXP shall thereafter, with respect to any such Ameriprise Asset, use reasonable best efforts, with the costs of AXP related thereto to be promptly reimbursed by Ameriprise, to hold such Ameriprise Asset in trust for the use and benefit of Ameriprise and, with respect to any such Ameriprise Liability, retain such Ameriprise Liability for the account of Ameriprise; and (iii) Ameriprise shall thereafter, with respect to any such AXP Asset, use reasonable best efforts, with the costs of Ameriprise related thereto to be promptly reimbursed by AXP, to hold such AXP Asset in trust for the use and benefit of AXP and, with respect to any such AXP Liability, to retain such AXP Liability for the account of AXP, in each case in order to place each Party, insofar as is reasonably possible, in the same position as would have existed had such Delayed Transfer Asset and/or Liability been contributed, assigned, transferred, conveyed, delivered or assumed as contemplated hereby (it being understood that neither AXP (with respect to any Ameriprise Asset or Ameriprise Liability) nor Ameriprise (with respect to any AXP Asset or AXP Liability) shall be required to take any action pursuant to this clause that would, or could reasonably be expected to, result in any financial obligation to it or any restriction on its business or operations, except as may be required in any Ancillary Agreement. To the extent that Ameriprise is provided the use or benefit of any Ameriprise Asset or has any Ameriprise Liability held for its account pursuant to this Section 2.03(b), Ameriprise shall perform, for the benefit of AXP and any third Person, the obligations of AXP thereunder or in connection therewith, or as may be directed by AXP and if Ameriprise shall fail to perform to the extent required herein, Ameriprise shall hold AXP harmless and indemnify AXP therefor. To the extent that AXP is provided the use or benefit of any AXP Asset or has any AXP Liability held for its account pursuant to this Section 2.03(b), AXP shall perform, for the benefit of Ameriprise and any third Person, the obligations of Ameriprise thereunder or in connection therewith, or as may be directed by Ameriprise and if AXP shall fail to perform to the extent required herein, AXP shall hold Ameriprise harmless and indemnify Ameriprise therefor. Each Party shall, and/or shall cause members of its Group to, as and when any such Delayed Transfer Asset and/or Liability becomes contributable, assignable, transferable, conveyable, deliverable or assumable by such Party, effect such contribution, assignment, transfer, conveyance, delivery or assumption, as applicable, as promptly as practicable thereafter. (c) Assignment of Certain Agreements. Subject to the Ancillary Agreements and to Section 2.03(g) hereof, (i) AXP shall assign to Ameriprise all of its right, title and interest under the agreements comprising Ameriprise Assets, as set forth on Schedule 2.03(c)(i) attached hereto, and (ii) Ameriprise shall assign to AXP all of its right, title and interest under the agreements comprising AXP Assets, as set forth on Schedule 2.03(c)(ii) attached hereto, and each Party shall execute and deliver any and all instruments of substitution and such other instruments or agreements as shall be necessary in connection with the discharge of the other Party from its respective obligations with respect to such agreements. (d) Termination of Certain Agreements. Subject to Section 2.03(e), all contracts, licenses, agreements, commitments or other arrangements, formal or informal, between any member of the AXP Group, on the one hand, and any member of the Ameriprise Group, on the other hand, in existence on or prior to the Distribution Date, shall be automatically settled, cancelled, assigned, assumed or terminated by the Parties at the Effective Time, except (i) for (A) such agreements specifically set forth 9 on Schedule 2.03(d) attached hereto, (B) this Agreement and (C) each Ancillary Agreement (including each other agreement or instrument expressly contemplated by this Agreement or any Ancillary Agreement to be entered into by any of the Parties or any of the members of their respective Groups), (ii) for any contracts, licenses, agreements, commitments or other arrangements to which any Person is a party in addition to either Party or any member of either Group, or (iii) as otherwise agreed to in good faith by the Parties in writing on or after the date hereof. Except as expressly provided in Section 2.03(e), from and after the Distribution Date, no member of either Group shall have any rights or obligations under any such settled, cancelled, assigned, assumed or terminated contract, license, agreement, commitment or arrangement with any member of the other Group. (e) Settlement of Inter-Group Indebtedness. Except with respect to the agreements specifically set forth on Schedule 2.03(d) , the Parties shall use their reasonable best efforts to settle all amounts payable in connection with any Inter-Group Indebtedness on or prior to the Distribution Date, and in any event shall settle all such amounts payable in connection with such Inter-Group Indebtedness no later than the 60 th day following the Distribution Date. (f) Guarantee Obligations. (i) AXP and Ameriprise shall cooperate, and shall cause their respective Groups to cooperate, to terminate, or to cause a member of the AXP Group to be substituted in all respects for any member of the Ameriprise Group in respect of, all obligations of such member of the Ameriprise Group under any AXP Liability for which such member of the Ameriprise Group may be liable, as guarantor, original tenant, primary obligor or otherwise. If such termination or substitution is not effected by the Distribution Date, (A) AXP shall indemnify and hold harmless the Ameriprise Indemnified Party for any Liability arising from or relating thereto and (B) without the prior written consent of Ameriprise, from and after the Distribution Date, AXP shall not, and shall not permit any member of the AXP Group or any of its Affiliates to, amend, renew or extend the term of, increase its obligations under, or transfer to a third Person, any loan, lease, contract or other obligation for which any member of the Ameriprise Group is or may be liable, unless all obligations of the Ameriprise Group with respect thereto are thereupon terminated by documentation reasonably satisfactory in form and substance to Ameriprise; provided , that the limitations in clause (B) shall not apply in the event that a member of the AXP Group obtains a letter of credit from a financial institution reasonably acceptable to Ameriprise and for the benefit of any member of the Ameriprise Group with respect to such obligation of the Ameriprise Group. (ii) AXP and Ameriprise shall cooperate, and shall cause their respective Groups to cooperate, to terminate, or to cause a member of the Ameriprise Group to be substituted in all respects for any member of the AXP Group in respect of, all obligations of such member of the AXP Group under any Ameriprise Liability for which such member of the AXP Group may be liable, as guarantor, original tenant, primary obligor or otherwise. If such termination or substitution is not effected by the Distribution Date, (A) Ameriprise shall indemnify and hold harmless the AXP Indemnified Party for any Liability arising from or relating thereto and (B) without the prior written consent of AXP, from and after the Distribution Date, Ameriprise shall not, and shall not permit any member of the Ameriprise Group to, amend, renew or extend the term of, increase its obligations under, or transfer to a third Person, any loan, lease, contract or other obligation for which any member of the AXP Group is or may be liable, unless all obligations of the AXP Group with respect thereto are thereupon terminated by documentation reasonably satisfactory in form and substance to AXP; provided , that the limitations in clause (B) shall not apply in the event that a member of the Ameriprise Group obtains a letter of credit from a financial institution reasonably acceptable to AXP and for the benefit of any member of the AXP Group with respect to such obligation of the AXP Group. (g) Mixed Contracts; Mixed Accounts. (i) Unless the Parties agree otherwise, any agreement to which any member of the AXP Group or the Ameriprise Group is a party prior to the Effective Time 10 that inures to the benefit or burden of both of the AXP Business and the Ameriprise Business (a " Mixed Contract ") shall be assigned in part to Ameriprise or one of its Subsidiaries, and/or to AXP or one of its Subsidiaries, as the case may be, if so assignable, prior to or as of the Effective Time, such that each Party or its respective Subsidiaries shall be entitled to the rights and benefits thereof and shall assume the related portion of any obligations thereunder and any Liabilities inuring to their respective Businesses; provided , however , that in no event shall either Party be required to assign any Mixed Contract in its entirety. If any Mixed Contract cannot be so partially assigned, AXP and Ameriprise shall, and shall cause each of their respective Subsidiaries to, take such other reasonable and permissible actions to cause: (A) the Assets associated with that portion of each Mixed Contract that relates to the Ameriprise Business to be enjoyed by Ameriprise or an Ameriprise Subsidiary; (B) the Liabilities associated with that portion of each Mixed Contract that relates to the Ameriprise Business to be borne by Ameriprise or an Ameriprise Subsidiary; (C) the Assets associated with that portion of each Mixed Contract that relates to the AXP Business to be enjoyed by AXP or an AXP Subsidiary; and (D) the Liabilities associated with that portion of each Mixed Contract that relates to the AXP Business to be borne by AXP or an AXP Subsidiary; provided , however , that the arrangements described in clauses (A), (B), (C) and (D) shall terminate on the earlier to occur of (1) the termination of the applicable Mixed Contract and (2) the second anniversary of the Distribution Date. (ii) Except as may otherwise be agreed by the Parties, neither Party shall seek to assign any accounts receivable or accounts payable relating to both the AXP Business and the Ameriprise Business (" Mixed Accounts "). AXP and Ameriprise shall, and shall cause each of their respective Subsidiaries to, take such other reasonable and permissible actions to cause: (A) the Assets associated with that portion of each Mixed Account that relates to the AXP Business to be enjoyed solely by AXP or an AXP Subsidiary; (B) the Liabilities associated with that portion of each Mixed Account that relates to the AXP Business to be borne solely by AXP or an AXP Subsidiary; (C) the Assets associated with that portion of each Mixed Account that relates to the Ameriprise Business to be enjoyed solely by Ameriprise or an Ameriprise Subsidiary; and (D) the Liabilities associated with that portion of each Mixed Account that relates to the Ameriprise Business to be borne solely by Ameriprise or an Ameriprise Subsidiary; provided , however , that the arrangements described in clauses (A), (B), (C) and (D) shall terminate no later than the second anniversary of the Distribution Date. (iii) Nothing in this Section 2.03(g) shall require any member of either Group to make any payment, incur any obligation or grant any concession to any third party in order to effect any transaction contemplated by this Section 2.03(g). (h) Shared Employees. Immediately prior to the Distribution Date, (i) each Person who is an officer, director or employee of any member of the Ameriprise Group and an officer, director or employee of any member of the AXP Group (a " Shared Employee ") and who is to continue as an officer, director or employee of any member of the Ameriprise Group after the Distribution Date shall resign, effective at or prior to the Effective Time, from each of such Person's positions with each member of the AXP Group and (ii) each such Shared Employee who is to continue as an officer, director or employee of any member of the AXP Group after the Distribution Date shall resign, effective at or prior to the Effective Time, from each of such Person's positions with each member of the Ameriprise Group. 11 SECTION 2.04. Conditions Precedent to Consummation of the Recapitalization, Separation and the Contribution . The obligations of the Parties to consummate each of the Recapitalization, the Contribution and the Separation is subject to the prior or simultaneous satisfaction, or waiver by AXP in its sole and absolute discretion, of each of the following conditions: (a) final approval of the Recapitalization, the Contribution and the Separation shall have been given by the Board of Directors of AXP in its sole and absolute discretion; and (b) each of the conditions precedent to the consummation of the Distribution set forth in Section 3.03 hereof (other than Section 3.03(j)) shall have been satisfied or waived by AXP in its sole and absolute discretion. Each of the foregoing conditions is for the benefit of AXP and AXP may, in its sole and absolute discretion, determine whether to waive any such condition. Any determination made by AXP prior to the Recapitalization, the Contribution or the Separation concerning the satisfaction or waiver of any or all of the conditions set forth in this Section 2.04 shall be conclusive and binding on the Parties. Section 3.01. Actions Prior to the Distribution . Subject to the satisfaction or waiver of the conditions set forth in Section 3 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AGREEMENTS / CONTRACTS
CLAUSES
| Get Email Updates |
