Exhibit 10.5
EXECUTION COPY
EIGHTH AMENDED AND
RESTATED
AGREEMENT OF
LIMITED
PARTNERSHIP
Of
IMS HEALTH LICENSING ASSOCIATES,
L.P.,
A Delaware limited
partnership
By and Among
IMS AG,
COORDINATED MANAGEMENT SYSTEMS,
INC.,
UTRECHT-AMERICA FINANCE
CO.,
AND
EDAM, L.L.C.
Dated as of July 1,
2003
TABLE OF CONTENTS
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EXHIBITS
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Exhibit A
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Form Demand Promissory Note and Guaranty of
Payment
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Exhibit B
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Form Confidentiality Certificate
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Exhibit C-1
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Form Transferor Certificate
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Exhibit C-2
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Form Transferee Certificate
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Exhibit D
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Form of Master Lease
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EIGHTH AMENDED AND
RESTATED
AGREEMENT OF LIMITED
PARTNERSHIP
OF
IMS HEALTH LICENSING ASSOCIATES,
L.P.,
A DELAWARE LIMITED
PARTNERSHIP
EIGHTH AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP, dated as of the 1 st
day of July, 2003, by and among IMS AG, a corporation organized
under the laws of Switzerland and successor in interest to IMS
Pharminform Holding AG, as the General Partner, Utrecht-America
Finance Co., a Delaware corporation (“ Utrecht
”) and Edam, L.L.C., a Delaware limited liability company
(“ Edam ”), as the Class A Limited
Partners, and COORDINATED MANAGEMENT SYSTEMS, INC., a Delaware
corporation (“ CMS ”), as the
Class B Limited Partner.
The Partnership was formed on
June 7, 1993. The Partners hereby agree to continue the
Partnership as a limited partnership pursuant to the provisions of
the Act and upon the terms and conditions set forth in this
Agreement. This Agreement completely amends, restates and
supersedes that certain Seventh Amended and Restated Agreement of
Limited Partnership of IMS Health Licensing Associates, L.P.
effective as of July 1, 2000 (the “ Seventh
Amended Partnership Agreement ” ).
The name of the Partnership shall
continue to be IMS Health Licensing Associates, L.P., and all
business of the Partnership shall be conducted in such name or, in
the discretion of the General Partner, under any other name;
provided that, the General Partner may change the name of
the Partnership only upon ten (10) Business Days’ notice to
the Limited Partners.
The purpose of the Partnership is to
engage in the business of owning certain investments in Permitted
Assets and to manage, protect, conserve and dispose of such
investments in Permitted Assets and to make such additional
investments and engage in such additional business endeavors as are
permitted under this Agreement or otherwise as the Partners may
agree, and to engage in activities related or incidental
thereto. The Partnership shall have the power to do any and
all acts necessary, appropriate, proper, advisable, incidental or
convenient to or in furtherance of the purpose of the Partnership
and shall have without limitation, any and all powers that may be
exercised on behalf of the Partnership by the General Partner
pursuant to Section 1.09(c) and Article V
hereof.
SECTION 1.04 . Principal Place of
Business.
The principal place of business of
the Partnership shall continue to be at Dorfplatz 4,
6330 Cham, Switzerland. The General Partner may change
the principal place of business of the Partnership to any other
place within Switzerland upon ten (10) Business Days’ notice
to the Limited Partners. The registered office of the
Partnership in the State of Delaware is located at The Corporation
Trust Company, Corporation Trust Center, 1209 Orange Street,
Wilmington, New Castle County, Delaware 19801.
The term of the Partnership
commenced on the date the certificate of limited partnership
described in Section 17-201 of the Act (the “
Certificate ”) was filed in the office of the
Secretary of State of the State of Delaware in accordance with the
Act and shall continue until the winding up and liquidation of the
Partnership and its business is completed following a Liquidating
Event as provided in Article XII hereof.
SECTION 1.06 . Filings; Agent for Service of
Process.
(a)
The General Partner has caused the Certificate to be filed in the
office of the Secretary of State of the State of Delaware in
accordance with the provisions of the Act. The General
Partner shall take any and all other actions including without
limitation the filing of amendments to the Certificate reasonably
necessary to perfect and maintain the status of the Partnership as
a limited partnership under the laws of the State of Delaware or
any other states in which the Partnership is engaged in
business. The General Partner shall cause amendments to the
Certificate to be filed whenever required by the Act. Such
amendments may be executed by the General Partner and by each
Person designated in the amendment as a new General
Partner.
(b)
The registered agent for service of process on the Partnership in
the State of Delaware shall continue to be The Corporation Trust
Company, Corporation Trust Center, 1209 Orange Street,
Wilmington, New Castle County, Delaware 19801 or any successor as
appointed by the General Partner in accordance with the
Act.
(c)
Upon the dissolution and completion of the winding up and
liquidation of the Partnership, the General Partner (or, in the
event there is no remaining General Partner, any Person appointed
pursuant to Section 12.09 hereof) shall promptly execute and
cause to be filed certificates of cancellation in accordance with
the Act and the laws of any other states or jurisdictions in which
the General Partner or such other appointed Person, as the case may
be, deems such filing necessary or advisable.
All property owned by the
Partnership or the Partnership Subsidiary shall be owned by the
Partnership or the Partnership Subsidiary as an entity and no
Partner shall have any ownership interest in such property in its
individual name or right, and each Partner’s interest in the
Partnership shall be personal property for all purposes. The
Partnership shall hold all of its property in the name of the
Partnership and not in the name of any Partner.
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SECTION 1.08. Payments of Individual
Obligations.
The Partnership’s credit and
assets shall be used solely for the benefit of the Partnership, and
no asset of the Partnership shall be Transferred or encumbered for
or in payment of any individual obligation of any
Partner.
SECTION 1.09 . Independent Activities; Transactions
with Affiliates.
(a)
The General Partner and any of its Affiliates shall be required to
devote only such time to the affairs of the Partnership as the
General Partner determines in its sole discretion may be necessary
to manage and operate the Partnership, and each such Person, shall
be free to serve any other Person or enterprise in any capacity
that it may deem appropriate in its discretion.
(b)
To the extent permitted by applicable law and except as otherwise
provided in this Agreement, each Partner acknowledges that the
other Partners (each acting on its own behalf) and their Affiliates
are free to engage or invest in an unlimited number of activities
or businesses, any one or more of which may be related to the
activities or businesses of the Partnership, without having or
incurring any obligation to offer any interest in such activities
or businesses to the Partnership or any Partner, and neither this
Agreement nor any activity undertaken pursuant to this Agreement
shall prevent any Partner or its Affiliates from engaging in such
activities, or require any Partner to permit the Partnership or any
Partner or its Affiliates to participate in any such activities,
and as a material part of the consideration for the execution of
this Agreement by each Partner, each Partner hereby waives,
relinquishes, and renounces any such right or claim of
participation. The Partners acknowledge that certain
conflicts of interest may thus arise and hereby agree that the
specific rights with respect to the Partners’ and their
Affiliates’ freedom of action provided in this
Section 1.09(b) are sufficient to protect their respective
interests in relation to such possible conflicts and are to be in
lieu of all other possible limitations which might otherwise be
implied in fact, in law or in equity.
(c)
To the extent permitted by applicable law and except as otherwise
provided in this Agreement, the General Partner, when acting on
behalf of the Partnership, is hereby authorized to purchase
property from, sell property to or otherwise deal with any Partner,
acting on its own behalf, or any Affiliate of any Partner;
provided that any such purchase, sale or other transaction
shall be in the ordinary course of the Partnership’s business
and shall be made on terms and conditions which are no less
favorable to the Partnership than if the sale, purchase or other
transaction had been made with an independent third party on
prevailing market terms. The Partners agree that the 2003 IMS
Lease, the Demand Loans, IMS Health Guaranteed Demand Loans, the
Demand Notes, the Fifth CMS Contribution Agreement, any Term Note
to Spartan entered into pursuant to Section 5.03(j) hereof and
any Master Lease entered into pursuant to Section 5.04(h)
hereof satisfy this independent third-party standard and the
Partners hereby authorize the General Partner to cause the
Partnership or the Partnership Subsidiary to enter into the
documents referenced in this Section 1.09(c) or confirm that
the General Partner was authorized to cause the Partnership or the
Partnership Subsidiary to have entered into the documents
referenced in this Section 1.09(c) that were entered into
prior to the Closing Date.
(d)
Each Partner and any Affiliate thereof may also borrow money from,
and transact other business with the Partnership and, subject to
other applicable law, has the same rights and
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obligations with respect
thereto as a Person who is not a Partner. The existence of
these relationships and acting in such capacities will not result
in any Limited Partner being deemed to be participating in the
control of the business of the Partnership or otherwise affect the
limited liability of any Limited Partner.
Capitalized words and phrases used
in this Agreement have the following meanings:
“ 2003 CMS
Improvements ” has the meaning set forth in
subparagraph (i) of the definition of “Permitted
Assets.”
“ 2003 IMS Health
Lease ” means that certain Lease Agreement, dated as
of July 1, 2003 (as amended or otherwise modified from time to
time), between the Partnership and IMS Health pursuant to which CMS
Intangible Assets are leased to IMS Health.
“ Act ”
means the Delaware Revised Uniform Limited Partnership Act, as set
forth in Del. Code Ann. Tit. 6, Sections 17-101 to
17-1111, as amended, modified or supplemented from time to time (or
any corresponding provisions of succeeding law).
“ Additional Capital
Contributions ” means, with respect to each Partner,
the Capital Contributions made by such Partner (or its predecessors
in interest) pursuant to Section 2.02 hereof (or its
predecessor provision).
“ Adjusted Capital
Account Deficit ” means, with respect to each Limited
Partner, the deficit balance, if any, in such Limited
Partner’s Capital Account as of the end of the relevant
Allocation Year, after giving effect to the following
adjustments:
(i)
Credit to such Capital Account any amounts which such Limited
Partner is deemed to be obligated to restore pursuant to the
penultimate sentences of Regulations Sections 1.704-2(g)(1)
and 1.704-2(i)(5); and
(ii)
Debit to such Capital Account the items described in
Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5) and
1.704-1(b)(2)(ii)(d)(6) of the Regulations.
The foregoing definition of Adjusted
Capital Account Deficit is intended to comply with the provisions
of Section 1.704-1(b)(2)(ii)(d) of the Regulations and shall
be interpreted consistently therewith.
“ Affiliate
” means, with respect to any Person, (i) any Person
directly or indirectly controlling, controlled by or under common
control with such Person, (ii) any officer, director or
general partner of such Person, or (iii) any Person who is an
officer, director, general partner or trustee of any Person
described in clauses (i) or (ii) of this sentence.
For purposes of this definition, the term
“control,” (including, with correlative
meanings, the terms “controlling,”
“controlled by” or “under
common control with” ) means the possession, direct
or indirect, of the power to direct or cause the direction of
the
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management and policies of a Person,
whether through the ownership of voting securities, by contract or
otherwise.
“ Agreement
” means this Eighth Amended and Restated Agreement of Limited
Partnership, as amended, modified or supplemented from time to
time. All references in this Agreement to
“Section” or “Sections” are to a section or
sections of this Agreement unless otherwise specified.
“ Allocation
Year ” means (i) the period commencing on
July 1, 2003 and ending on December 31, 2003,
(ii) any subsequent period commencing on January 1 and
ending on the following December 31, or (iii) any portion
of the period described in clause (i) or (ii) for which the
Partnership is required to allocate Profits, Losses and other items
of Partnership income, gain, loss or deduction pursuant to
Article III hereof.
“ Alternative
Appraiser ” means any of the “Big Four”
accounting firms (including appraisal divisions thereof or
successors thereto), American Appraisal Associates Inc., Duff &
Phelps LLC, Empire Appraisal Company, Hempstead & Co.,
Stephen C. Gerard (including any firm with which he is
associated), Standard & Poor’s Corporate Value
Consulting, a division of The McGraw-Hill Companies, Inc., or with
the consent of all Partners, any firm recommended by any of the
foregoing Alternative Appraisers.
“ Bankruptcy
” means, with respect to any Person, a Voluntary Bankruptcy
or an Involuntary Bankruptcy. A “ Voluntary
Bankruptcy ” means, with respect to any Person,
(a)(i) the inability of such Person generally to pay its debts
as such debts become due, (ii) the failure of such Person
generally to pay its debts as such debts become due, or
(iii) an admission in writing by such Person of its inability
to pay its debts generally or a general assignment by such Person
for the benefit of creditors, (b) the filing of any petition
or answer by such Person seeking to adjudicate it a bankrupt or
insolvent, or seeking for itself any liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or
composition of such Person or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors, or
seeking, consenting to, or acquiescing in the entry of an order for
relief or the appointment of a receiver, trustee, custodian or
other similar official for such Person or for any substantial part
of its property, or (c) corporate action taken by such Person
to authorize any of the actions set forth above. An
“Involuntary Bankruptcy” means, with
respect to any Person, without the consent or acquiescence of such
Person, the entering of an order for relief or approving a petition
for relief or reorganization or any other petition seeking any
reorganization, arrangement, composition, readjustment,
liquidation, dissolution or other similar relief under any present
or future bankruptcy, insolvency or similar statute, law or
regulation, or the filing of any such petition against such Person
which petition shall not be dismissed within sixty (60) days,
or, without the consent or acquiescence of such Person, the
entering of an order appointing a trustee, custodian, receiver or
liquidator of such Person or of all or any substantial part of the
property of such Person which order shall not be dismissed within
sixty (60) days. It is the intent of the Partners that these
definitions supersede those set forth in Section 17-402(d)(4)
of the Act.
“ Basic Term
” shall have the meaning set forth in Section 1 of the
Master Lease.
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“ Business Day
” means any day except Saturday or Sunday or any other day on
which commercial banks are required or authorized by law to close
in New York City, Bermuda or Zurich or on which dealings in
deposits are not carried on in the London interbank
market.
“ Capital
Account ” means, with respect to any Partner, the
Capital Account maintained for such Partner in accordance with the
following provisions:
(i)
To each Partner’s Capital Account there shall be credited
such Partner’s Capital Contributions, such Partner’s
distributive share of Profits and any items in the nature of income
or gain which are specially allocated pursuant to
Sections 3.03, 3.04 or 3.05 hereof.
(ii)
To each Partner’s Capital Account there shall be debited the
amount of cash and the Gross Asset Value of any Property
distributed to such Partner pursuant to any provision of this
Agreement, such Partner’s distributive share of Losses and
any items in the nature of expenses or losses which are specially
allocated pursuant to Sections 3.03, 3.04 or 3.05
hereof.
(iii)
In the event all or a portion of an Interest in the Partnership is
Transferred in accordance with the terms of this Agreement, the
transferee shall succeed to the Capital Account of the transferor
to the extent it relates to the Transferred Interest.
The foregoing provisions and the
other provisions of this Agreement relating to the maintenance of
Capital Accounts are intended to comply with Section 1.704-1(b) of
the Regulations, and they shall be interpreted and applied in a
manner consistent with such Regulations. In the event the
General Partner shall determine that it is prudent to modify the
manner in which the Capital Accounts, or any debits or credits
thereto (including, without limitation, debits or credits relating
to liabilities which are secured by contributed or distributed
property or which are assumed by the Partnership or any Partner),
are computed in order to comply with such Regulations, the General
Partner may make such modification, provided that it is not
likely to have a Material Adverse Effect on the amounts
distributable to any Partner pursuant to Article XII hereof upon
the dissolution of the Partnership. The General Partner also
shall (i) make any adjustments that are necessary or
appropriate to maintain equality between the Capital Accounts of
the Partners and the amount of Partnership capital reflected on the
Partnership’s balance sheet, as computed for book purposes,
in accordance with Regulations Section 1.704-1(b)(2)(iv)( q
), and (ii) make any appropriate modifications in the event
unanticipated events might otherwise cause this Agreement not to
comply with Regulations Section 1.704-1(b), provided that,
to the extent that any such adjustment is inconsistent with other
provisions of this Agreement and would have a Material Adverse
Effect on any Limited Partner, such adjustment shall require the
consent of such Limited Partner.
“ Capital
Contributions ” means, with respect to any Partner,
the amount of money and the initial Gross Asset Value of any
property (other than money) contributed to the
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Partnership by such Partner (or its
predecessors in interest) with respect to the Interest in the
Partnership held by such Partner.
“ Cash Available for
Distribution ” for any Fiscal Quarter means the gross
cash proceeds of the Partnership less the portion thereof
used to pay or establish reasonable reserves for all Partnership
expenses (including, without limitation, taxes), all as determined
by the General Partner. “Cash Available for
Distribution” will not be reduced by depreciation, depletion,
amortization, cost recovery deduction, or similar allowances, and
will be increased by any reductions of reserves previously
established pursuant to the first sentence of this
definition.
“ Cash
Equivalents ” shall mean cash and any of the
following: (i) readily marketable direct obligations of the
Government of the United States or any agency or instrumentality
thereof or obligations unconditionally guaranteed by the full faith
and credit of the Government of the United States, or
(ii) certificates of deposit of or time or demand deposits
with (A) any commercial bank that is a member of the Federal
Reserve System, the parent of which issues commercial paper rated
at least P-1 (or the equivalent grade) by Moody’s or A-1 (or
the then equivalent grade) by S&P, is organized under the laws
of the United States or any State thereof, and the long term
unsecured debt of which is rated A2 or better by Moody’s and
A or better by S&P or (B) any commercial bank organized
under the laws of any OECD member country (as of the effective date
of this Agreement) which is not subject to currency controls and
the long term unsecured debt of which is rated A2 or better by
Moody’s and A or better by S&P; provided, however
, that all Property described in this definition other than cash
shall have a maturity of not longer than ninety (90)
days.
“ Certificate
” has the meaning set forth in Section 1.05
hereof.
“ Class A Limited
Partner ” means any Person who (i) is referred
to as such in the introductory statement of this Agreement or who
has become a substituted Class A Limited Partner pursuant to
the terms of this Agreement, and (ii) has not ceased to be a
Class A Limited Partner.
“ Class B Limited
Partner ” means any Person who (i) is referred
to as such in the introductory statement of this Agreement or who
has become a substituted Class B Limited Partner pursuant to
the terms of this Agreement, and (ii) has not ceased to be a
Class B Limited Partner.
“ Closing Date
” means July 1, 2003.
“ Closing Date Capital
Account ” means, with respect to each Partner, the
Capital Account balance stated for such Partner in
Section 2.05 hereof.
“ CMS ”
means Coordinated Management Systems, Inc., a Delaware corporation
or any successor in interest.
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“ CMS Additional
Contribution Agreement ” means that certain
Contribution Agreement, dated July 6, 1993, between CMS and
the Partnership pursuant to which CMS contributed the assets
described therein to the Partnership.
“ CMS Intangible
Assets ” has the meaning set forth in
subparagraph (i) of the definition of “Permitted
Assets.”
“ Code ”
means the Internal Revenue Code of 1986, as amended, modified or
supplemented from time to time, or any successor
legislation.
“ Cognizant
Event ” has the meaning set forth in the Cognizant
Guaranty.
“ CP Rate
” has the meaning set forth in the form Demand
Note.
“ Debt ”
of a Person means (i) any indebtedness for borrowed money or
deferred purchase price of property or services as evidenced by a
note, bond, or other instrument, (ii) obligations to pay money
as lessee under capital leases, (iii) to the extent of the
fair market value of any asset owned or held by such Person,
obligations to pay money secured by any mortgage, pledge, security
interest, encumbrance, lien or charge of any kind existing on such
asset whether or not such Person has assumed or become liable for
the obligations secured thereby, (iv) obligations in respect
of accounts payable, other than accounts payable that are incurred
in the ordinary course of such Person’s business and are not
delinquent or are being contested in good faith by appropriate
proceedings, and (v) obligations under direct or indirect
guarantees of (including obligations (contingent or otherwise) to
assure a creditor against loss in respect of) indebtedness or
obligations of the kinds referred to in clauses (i), (ii),
(iii) and (iv) above.
“ Demand Loan
” means a loan that is made by the Partnership or the
Partnership Subsidiary to, and at all times the obligor under which
is, IMS Health or any Affiliate of IMS Health and the obligations
of IMS Health with respect to which rank at all times at least
pari passu with all other senior unsecured Debt of IMS
Health, provided that each such Loan (i) is payable on
demand, (ii) bears interest at a floating rate (based on
(a) 1-month, 2-month, 3-month, 6-month or 12-month LIBOR or
(b) a 30-day, 60-day, 90-day or 180-day CP Rate) plus a
margin that reflects the rate that would be charged to IMS Health
on an arm’s length basis (taking into account general credit
conditions as well as IMS Health’s debt ratings at the time
the interest rate on such borrowing is set), and the General
Partner shall review the appropriateness of the interest rates not
less than every six months, (iii) is denominated in U.S.
dollars, and (iv) is evidenced by a Demand Note including a
Guaranty of Payment by IMS Health in the event that the Loan is
made to any Affiliate of IMS Health.
“ Demand Note
” means any promissory note evidencing a Demand Loan in the
form attached hereto as Exhibit A .
“ Depreciation
” means, for each Allocation Year, an amount equal to the
depreciation, amortization, or other cost recovery deduction
allowable for federal income tax purposes with respect to an asset
for such Allocation Year, except that (i) with respect to any
asset whose Gross Value differs from its adjusted tax basis for
United States
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federal income tax purposes and
which difference is being eliminated by use of the “remedial
method” defined by § 1.704-3(d) of the Regulations,
Depreciation for such Allocation Year shall be the amount of book
basis recovered for such Allocation Year under the rules prescribed
by § 1.704-3(d)(2) of the Regulations; and (ii) with
respect to any other asset whose Gross Asset Value differs from its
adjusted basis for federal income tax purposes at the beginning of
such Allocation Year, Depreciation shall be an amount which bears
the same ratio to such beginning Gross Asset Value as the federal
income tax depreciation, amortization, or other cost recovery
deduction for such Allocation Year bears to such beginning adjusted
tax basis; provided, however , that if the adjusted basis
for federal income tax purposes of an asset at the beginning of
such Allocation Year is zero, Depreciation shall be determined with
reference to such beginning Gross Asset Value using any reasonable
method selected by the General Partner.
“ Early Liquidation
Date ” has the meaning set forth in the definition of
“Early Liquidation Premium.”
“ Early Liquidation
Premium ” means, with respect to each Class A
Limited Partner, an amount determined for such Partner as of any
date occurring prior to June 30, 2006 on which (w) the
Partnership is liquidated pursuant to Article XII hereof,
(x) such Partner’s Interest is retired in whole or in
part pursuant to Section 10.08 hereof or (y) the Interest
of such Class A Limited Partner is purchased pursuant to
Section 14.03 hereof (the “ Early Liquidation
Date ”), equal to the excess, if any, of (i) the
present value of the deemed quarterly distributions to be made to
such Class A Limited Partner on the last business day of each
Fiscal Quarter equal to 2.9235% of such Class A Limited
Partner’s Unrecovered Capital as of the Early Liquidation
Date during the period beginning on the Early Liquidation Date and
ending on June 30, 2006, minus (ii) the present
value of a series of amounts defined by the product of
(A) such Class A Limited Partner’s Unrecovered
Capital as of the Early Liquidation Date multiplied by (B) a
percentage that will be determined by the sum of (1) the sum
of (a) the bid side of the Treasury yield plus
(b) the bid side of the interbank swap spread, in each case
best approximating the period between the Early Liquidation Date
and ending on June 30, 2006, plus (2) 90 basis
points. The present value determined under
subparagraph (i) and the present value determined under
subparagraph (ii) shall each be calculated using the sum of
(X) the bid side of the Treasury yield, plus
(Y) the bid side of the interbank swap spread, in each case
best approximating the period between the Early Liquidation Date
and ending on June 30, 2006 as the discount rate.
“ Edam ”
means Edam, L.L.C., a Delaware limited liability
company.
“ Electing
Partners ” has the meaning set forth in
Section 14.03(a) hereof.
“ Election Date
” has the meaning set forth in Section 14.03(a)
hereof.
“ Election
Notice ” has the meaning set forth in
Section 14.03(a) hereof.
“ Expenses
” means any and all judgments, damages or penalties with
respect to, or amounts paid in settlement of, claims (including,
but not limited to negligence, strict or
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absolute liability, liability in
tort and liabilities arising out of violation of laws or regulatory
requirements of any kind), actions, or suits; and any and all taxes
(including, without limitation, taxes on any indemnification
payments and including interest, additions to tax and penalties),
liabilities, obligations, costs, expenses and disbursements
(including, without limitation, reasonable legal fees and
expenses).
“ Fifth CMS Contribution
Agreement ” means that certain Contribution Agreement
effective as of July 1, 2003, between CMS and the Partnership
pursuant to which CMS contributed the assets described therein to
the Partnership.
“ Fiscal Quarter
” means (i) the period commencing on July 1, 2003
and ending on September 30, 2003, and (ii) any subsequent
three-month period commencing on each of January 1,
April 1, July 1 and October 1 and ending on the next
of March 31, June 30, September 30 and
December 31; provided that the last fiscal quarter
shall end on the date on which all Property is distributed pursuant
to Section 12.02 hereof and the Certificate has been canceled
pursuant to the Act.
“ Fiscal Year
” means any period commencing on January 1 and ending on
the earlier to occur of (A) the following December 31, or
(B) the date on which all Property is distributed pursuant to
Section 12.02 hereof and the Certificate has been canceled
pursuant to the Act.
“ Form Confidentiality
Agreement ” has the meaning set forth in
Section 10.03(a) hereof.
“ Form Transferee
Certificate ” has the meaning set forth in
Section 10.03(f) hereof.
“ Form Transferor
Certificate ” has the meaning set forth in
Section 10.03(f) hereof.
“ Fourth CMS
Contribution Agreement ” means that certain
Contribution Agreement entered into on July 31, 2000 and
effective as of July 1, 2000, between CMS and the Partnership
pursuant to which CMS contributed the assets described therein to
the Partnership.
“ GAAP ”
means United States generally accepted accounting principles, and
with respect to the Partnership, as modified by Regulations
promulgated under Section 704(b) of the Code, as in effect
from time to time, applied on a basis consistent (except for
changes concurred in by the Partnership’s independent public
accountants) with the most recent audited financial statements of
the Partnership delivered to the Class A Limited
Partners.
“ General
Partner ” means any Person who (i) is referred
to as such in the introductory statement of this Agreement or has
become a General Partner pursuant to the terms of this Agreement,
and (ii) has not ceased to be a General Partner pursuant to
the terms of this Agreement.
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“ Gross Asset
Value ” means, with respect to any asset, the
asset’s adjusted basis for federal income tax purposes,
except as follows:
(i)
The initial Gross Asset Value of any asset contributed by a Partner
to the Partnership shall be the gross fair market value of such
asset as determined pursuant to Section 2.02(c) hereof;
provided that the initial Gross Asset Value of the 2003 CMS
Improvements shall be as set forth in Section 2.01
hereof;
(ii)
The Gross Asset Values of all Partnership assets shall be adjusted
to equal their respective gross fair market values as determined in
accordance with Section 10.08(b)(i) in connection with the
following events: (A) the acquisition of an additional
interest in the Partnership by any Partner in exchange for more
than a de minimis Capital Contribution; (B) the
distribution by the Partnership to a Partner of more than a de
minimis amount of Property as consideration for an interest in
the Partnership; and (C) the liquidation of the Partnership
within the meaning of Regulations
Section 1.704-1(b)(2)(ii)(g);
(iii)
The Gross Asset Value of any Partnership asset distributed to any
Partner shall be the gross fair market value of such asset as
determined in accordance with Section 10.08(b)(i) hereof (or,
in the case of cash, shall be its face amount) as of the date of
such distribution; and
(iv)
The Gross Asset Values of Partnership assets shall be increased (or
decreased) to reflect any adjustments to the adjusted basis of such
assets pursuant to Code Section 734(b) or Code
Section 743(b), but only to the extent that such adjustments
are taken into account in determining Capital Accounts pursuant to
Regulations Section 1.704-1(b)(2)(iv)( m ) and
subparagraph (vii) of the definition of “Profits”
and “Losses” or Section 3.04(c) hereof;
provided, however , that Gross Asset Values shall not be
adjusted pursuant to this subparagraph (iv) to the extent that
an adjustment pursuant to subparagraph (ii) is required in
connection with a transaction that would otherwise result in an
adjustment pursuant to this subparagraph (iv).
If the Gross Asset Value of an asset
has been determined or adjusted pursuant to subparagraph (i),
(ii), or (iv), such Gross Asset Value shall thereafter be adjusted
by the Depreciation taken into account with respect to such asset
for purposes of the allocations made pursuant to Article III
hereof. For purposes of this definition of Gross Asset Value,
a Capital Contribution or distribution shall be considered de
minimis if its value is less than $1,000,000.
“ Guaranty of
Payment ” means any guaranty given by IMS Health in
connection with an IMS Health Guaranteed Demand Loan in the form of
Exhibit A to the Form Demand Promissory Note attached thereto
as Exhibit A .
“ IMS Health
” means IMS Health Incorporated, a Delaware corporation, or
any successor in interest.
“ IMS Health
Event ” has the meaning set forth in the IMS Health
Guaranty.
11
“ IMS Health Guaranteed
Demand Loan ” means a Demand Loan made by the
Partnership or the Partnership Subsidiary to an Affiliate of IMS
Health, in each case guaranteed by IMS Health.
“ IMS Health
Guaranty ” means that certain Seconded Amended and
Restated Guaranty, effective as of July 1, 2003, by IMS Health
in favor of Utrecht and Edam in replacement of and superseding the
Amended and Restated Guaranty given by IMS Health as of
July 1, 2000, in favor of Utrecht and Edam.
“ IMS Health
Partners ” means the General Partner and CMS and any
other Affiliate of IMS Health which may from time to time own an
Interest hereunder.
“ Indemnitee
” has the meaning set forth in Section 5.05(f)(i)
hereof.
“ Indemnitor
” has the meaning set forth in Section 5.05(f)(i)
hereof.
“ Individual Leasing
Record ” has the meaning set forth in Section 1
of the Master Lease.
“ Interest
” means any interest in the Partnership representing some or
all of the Capital Contributions made by a Partner pursuant to
Article II hereof, including any and all benefits to which the
holder of such an interest may be entitled as provided in this
Agreement, together with all obligations of such Person to comply
with the terms and provisions of this Agreement.
“ Investment Company
Act ” has the meaning set forth in Section 7.04
hereof.
“ Involuntary
Bankruptcy ” has the meaning set forth in the
definition of “Bankruptcy.”
“ Issuance Items
” has the meaning set forth in Section 3.04(d)
hereof.
“ Leased Assets
” has the meaning set forth in subparagraph (vi) of the
definition of “Permitted Assets.”
“ LIBOR ”
has the meaning set forth in the form Demand Note.
“ Lien ”
means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), preference,
priority or other security agreement of any kind or nature
whatsoever (including, without limitation, any conditional sale or
other title retention agreement, any financing or similar statement
or notice filed under the Uniform Commercial Code (as in effect
from time to time in the relevant jurisdiction), or any other
similar recording or notice statute, and any lease having
substantially the same effect as any of the foregoing).
“ Limited
Partner ” means any Class A Limited Partner or the
Class B Limited Partner.
12
“ Liquidating
Event ” has the meaning set forth in Section 12.01
hereof.
“ Liquidation
Notice ” has the meaning set forth in
Section 14.02(a) hereof.
“ Liquidator
” has the meaning set forth in Section 12.09
hereof.
“ Losses ”
has the meaning set forth in the definition of
“Profits” and “Losses.”
“ Market Value
” means, with respect to any Permitted Security, as to any
date, (i) if such security is registered under the Exchange
Act and listed on a national securities exchange or included on the
Nasdaq National Market (“ Nasdaq ”), the
closing sales price on the Business Day immediately preceding such
date, and (ii) if such security is not traded on a national
securities exchange or listed on Nasdaq or the value otherwise
cannot be determined under clause (i), the average of the firm
prices bid for such date quoted by Morgan Stanley Dean Witter,
Salomon Smith Barney and Credit Suisse First Boston, in each case
for the full amount of the specific security for which the Market
Value is being determined; provided, however, that the
Market Value of any Term Note to Spartan shall be equal to the
principal amount of such Note plus accrued but unpaid
interest thereon, if any; provided, further , that if there
has occurred and is continuing any payment or other material
default with respect to any such Note at the time such value is
being determined, the Mark-to-Market Value of such Note shall be
determined by an investment or commercial bank of national
recognition selected by the General Partner with the consent of the
Class A Limited Partner (which consent shall not be unreasonably
withheld).
“ Mark-to-Market Balance
Sheet ” has the meaning set forth in Section
8.02(d)(i) hereof.
“ Mark-to-Market
Value ” has the meaning set forth in Section
10.08(b)(i) hereof.
“ Master Lease
” has the meaning set forth in Section 5.04(h)
hereof.
“ Material Adverse
Effect ” with respect to each IMS Health Partner
shall mean (i) a material adverse effect on the business,
operations, properties, or condition (financial or otherwise) of
the Partnership, (ii) a material adverse effect on the ability
of the Partnership or each of the IMS Health Partners to perform
their respective obligations hereunder and under the agreements
referred to herein to which they are a party, or (iii) the
invalidity or unenforceability of this Agreement or such other
agreements or an assertion by the Partnership, or any such IMS
Health Partner, that this Agreement or such other agreement is
invalid or unenforceable or has an adverse effect on the rights or
remedies of any Class A Limited Partner under this Agreement or
such other agreements. “ Material Adverse
Effect ” with respect to any Class A Limited
Partner shall mean (i) a material adverse effect on the
business, operations, properties, or condition (financial or
otherwise) of such Class A Limited Partner, (ii) a
material adverse effect on the ability of such Class A Limited
Partner to perform its obligations hereunder and under the
agreements referred to herein to which it is a party or
(iii) the invalidity or unenforceability of this Agreement or
such other agreements or an assertion by such Class A Limited
Partner that this Agreement or such other agreement is invalid
or
13
unenforceable or an adverse effect
on the rights or remedies of the IMS Health Partners under this
Agreement or such other agreement.
“ Moody’s
” means Moody’s Investors Service, Inc. or any
successor by merger or consolidation to its business.
“ Notice Events
” has the meaning set forth in Section 14.01
hereof.
“ OECD ”
means the Organization for Economic Cooperation and
Development.
“ Partners
” means the General Partner and the Limited Partners.
“Partner” means any one of the
Partners.
“ Partnership
” means the partnership continued pursuant to this Agreement
and the partnership continuing the business of this Partnership
pursuant to Section 12.01 hereof in the event of dissolution
as provided in this Agreement.
“ Partnership
Subsidiary ” has the meaning set forth in
subparagraph (v) of the definition of “Permitted
Assets.”
“ Partnership Subsidiary
Stock ” has the meaning set forth in
subparagraph (v) of the definition of “Permitted Assets.
”
“ Percentage
Interest ” means, with respect to any Partner as of
any date, the ratio (expressed as a percentage) of such
Partner’s Capital Account on such date to the aggregate
Capital Accounts of all Partners on such date, such Capital
Accounts to be determined after giving effect to all contributions,
distributions and allocations for all Allocation Years ending on or
prior to such date. The Percentage Interest of each Partner
as of the Closing Date is set forth in Section 2.05
hereof. In the event that it is necessary to determine the
relative Percentage Interests of the Partners at a time when the
Capital Accounts of all Partners are zero or less, their relative
Percentage Interests shall be deemed to be the Percentage Interests
set forth in Section 2.05 hereof.
“ Permitted
Assets ” means:
(i)
Database and Software Assets . The assets,
other than Partnership Subsidiary Stock, contributed to the
Partnership by CMS pursuant to the CMS Additional Contribution
Agreement, the Second CMS Contribution Agreement, the Third CMS
Contribution Agreement, the Fourth CMS Contribution Agreement and
the Fifth CMS Contribution Agreement (in the latter instance, the
“ 2003 CMS Improvements; ” and the 2003
CMS Improvements, together with the other assets included in
this clause (i), hereinafter referred to as the
“CMS Intangible Assets” );
(ii)
Demand Loans and IMS Health Guaranteed Demand Loans;
(iii)
Permitted Securities;
14
(iv)
Cash or Cash Equivalents;
(v)
Partnership Subsidiary Stock . One hundred
percent (100%) of the issued and outstanding stock (“
Partnership Subsidiary Stock ”) of Spartan
Leasing Corporation, a Delaware corporation (the “
Partnership Subsidiary ”);
(vi)
Leased Assets . Any of the following items of
personal property owned by the Partnership Subsidiary and leased to
(A) IMS Health or (B) any Affiliate of IMS Health,
guaranteed by IMS Health (to the extent permitted pursuant to
Section 5.04(h) hereof) pursuant to the Master Lease executed
in accordance with Section 5.04(h) hereof (“
Leased Assets ”):
(a)
Office furniture, fixtures, and equipment; and
(b)
Computers, data processing and communications equipment provided
that “Leased Assets” shall not include
(v) personal property not utilized by IMS Health or its
Affiliates in the ordinary course of their businesses, (w) any
“limited use property” within the meaning of Revenue
Procedure 76-30, 1976-2 C.B. 647, as it may be amended or
modified from time to time or any successor Revenue Ruling or
Revenue Procedure, (x) any land, (y) any buildings or
(z) any other real estate; and
(vii)
Other Assets . Any other assets as may be
agreed to by all of the Partners.
“ Permitted
Encumbrances ” means, collectively,
(i) ”Permitted Encumbrances” as defined in each of
the CMS Additional Contribution Agreement, the Second CMS
Contribution Agreement, the Third CMS Contribution Agreement and
the Fourth CMS Contribution Agreement, and (ii) Liens and
encumbrances of carriers, warehousemen, mechanics and materialmen
incurred in the ordinary course of business for sums not yet due or
which are being contested in good faith by appropriate
proceedings.
“ Permitted
Securities ” means any of the following:
(i)
Direct obligations of the United States of America for the payment
of which its full faith and credit is pledged, Federal Home Loan
Mortgage Corporation participation certificates, Federal National
Mortgage Association mortgage pass-through certificates or
Government National Mortgage Association mortgage pass-through
certificates;
(ii)
Short-term commercial paper issued by any corporation organized
under the laws of the United States of America or any state
thereof, rated at least “A-1” (or the then-equivalent
grade) by S&P or “P-1” (or the then-equivalent
grade) by Moody’s; provided that the aggregate Market
Value of all commercial paper owned by the Partnership and issued
by any Person shall not exceed 10% of the aggregate Market Value of
all Permitted Securities (other than cash) owned by the
Partnership;
15
(iii)
Debt of any Person organized under the laws of the United States of
America or any state thereof that is not IMS Health or an Affiliate
of IMS Health, rated at least “AA-” (or the
then-equivalent grade) by S&P or “Aa3” (or the
then-equivalent grade) by Moody’s; provided , that the
aggregate Market Value of all such Debt owned by the Partnership
and issued by any Person shall not exceed 10% of the aggregate
Market Value of all Permitted Securities (other than cash) owned by
the Partnership;
(iv)
Unsubordinated Debt issued by IMS Health or unsubordinated Debt
issued by an Affiliate of IMS Health if (and only if) such Debt is
unconditionally guaranteed by IMS Health on an unsubordinated basis
(other than Demand Loans and IMS Health Guaranteed Demand Loans);
provided , that IMS Health has agreed to register such debt
under the Securities Act upon the request of the holder of such
debt and such agreement inures to the benefit of any subsequent
holder of such debt;
(v)
Any long-term obligation of IMS Health or an Affiliate of IMS
Health, guaranteed by IMS Health, to the Partnership Subsidiary,
with a fixed term of no less than 15 years and a fixed or floating
market rate of interest (each a “ Term Note to
Spartan ”); or
(vi)
Money market mutual funds, provided that, any such money
market fund invests only in Cash Equivalents and/or Permitted
Securities described in any of subparagraphs (i) through (iv)
above and/or repurchase agreements backed by securities described
in subparagraph (i) above, and provided further that,
the aggregate value of the Permitted Securities described in this
subparagraph (vi) and held by the Partnership at any given time
does not exceed $15,000,000.
“ Permitted
Transfer ” has the meaning set forth in
Section 10.02 hereof.
“ Permitted
Transferee ” has the meaning set forth in Section
10.02 hereof.
“ Person ”
means any individual, partnership (whether general or limited and
whether domestic or foreign), limited liability company,
corporation, trust, estate, association, custodian, nominee or
other entity.
“ Priority
Return ” means, with respect to each Class A
Limited Partner as of any date of determination, an amount
calculated as the sum of (x) 2.9235% per annum ,
accruing daily on a 30/360 basis and cumulative from July 1,
2003 to such date of determination, of such Class A Limited
Partner’s Unrecovered Capital on each such day of accrual,
and (y) 3.9235% per annum accruing daily on a 30/360
basis and cumulative from July 1, 2003 to such date of
determination, and compounded quarterly, of each amount not
distributed to such Class A Limited Partner (or its
predecessor in interest) when required pursuant to
Section 4.01(a) hereof (without regard to whether there was on
any given distribution date Cash Available for Distribution) or
Section 10.08(b)(ii) hereof during the period from the date
such distribution was thus required to be made to the
date
16
such distribution is made, or if
such distribution is not yet made, to the date of
determination. In each instance where this Agreement requires
that the Priority Return be determined for a period less than the
period beginning on July 1, 2003 and ending on the date of
determination, such determination shall be made by substituting the
first day of such lesser period for July 1, 2003 in the
preceding sentence. For purposes of calculating the Priority
Return, “30/360 basis” means a 360-day
year comprised of twelve 30-day months.
“ Profits
” and “ Losses ” means, for each
Allocation Year, an amount equal to the Partnership’s taxable
income or loss for such Allocation Year, determined in accordance
with Code Section 703(a) (for this purpose, all items of
income, gain, loss, or deduction required to be stated separately
pursuant to Code Section 703(a)(1) shall be included in
taxable income or loss), with the following adjustments:
(i)
Any income of the Partnership that is exempt from federal income
tax and not otherwise taken into account in computing Profits or
Losses pursuant to this definition of “Profits” and
“Losses” shall be added to such taxable income or
loss;
(ii)
Any expenditures of the Partnership described in Code
Section 705(a)(2)(B) or treated as Code
Section 705(a)(2)(B) expenditures pursuant to Regulations
Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into
account in computing Profits or Losses pursuant to this definition
of “Profits” and “Losses” shall be
subtracted from such taxable income or loss;
(iii)
In the event the Gross Asset Value of any Partnership asset is
adjusted pursuant to subparagraphs (ii) or (iii) of the
definition of Gross Asset Value, the amount of such adjustment
shall be taken into account as gain or loss from the disposition of
such asset for purposes of computing Profits or Losses;
(iv)
Gain or loss resulting from any disposition of Property with
respect to which gain or loss is recognized for federal income tax
purposes shall be computed by reference to the Gross Asset Value of
the property disposed of, notwithstanding that the adjusted tax
basis of such property differs from its Gross Asset
Value;
(v)
In lieu of the depreciation, amortization, and other cost recovery
deductions taken into account in computing such taxable income or
loss, there shall be taken into account Depreciation for such
Allocation Year, computed in accordance with the definition of
Depreciation;
(vi)
To the extent an adjustment to the adjusted tax basis of any
Partnership asset pursuant to Code Section 734(b) is required,
pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(4), to be
taken into account in determining Capital Accounts as a result of a
distribution other than in liquidation of a Partner’s
Interest, the amount of such adjustment shall be treated as an item
of gain (if the adjustment increases the basis of the asset) or
loss (if the
17
adjustment decreases such basis)
from the disposition of such asset and shall be taken into account
for purposes of computing Profits or Losses; and
(vii)
Notwithstanding anything to the contrary in subparagraphs (i)
through (vi) above, any items which are described in
Section 3.03 hereof or specially allocated pursuant to
Sections 3.04 or 3.05 hereof shall not be taken into account
in computing Profits or Losses.
The amounts of the items of
Partnership income, gain, loss or deduction available to be
specially allocated pursuant to Sections 3.03, 3.04 and 3.05
hereof shall be determined by applying rules analogous to those set
forth in subparagraphs (i) through (vi) above.
“ Property
” means all real and personal property acquired by the
Partnership, including cash, and any improvements thereto, and
shall include both tangible and intangible property.
“ Purchase Date
” has the meaning set forth in Section 8.02(e)
hereof.
“ Purchase
Option ” has the meaning set forth in
Section 14.03(a) hereof.
“ Purchase Price
” has the meaning set forth in Section 14.03(b)
hereof.
“ Regulations
” means the Income Tax Regulations, including Temporary
Regulations, promulgated under the Code, as such regulations are
amended, modified or supplemented from time to time.
“ Regulatory
Allocations ” has the meaning set forth in
Section 3.05 hereof.
“ Responsible
Officers ” has the meaning set forth in
Section 5.04(b) hereof.
“ Retirement
Date ” has the meaning set forth in
Section 10.08(b)(iii) hereof.
“ Retirement
Notice ” has the meaning set forth in
Section 10.08(a)(ii) hereof.
“ S&P
” means Standard & Poor’s Corporation or any
successor by merger or consolidation to its business.
“ Second CMS
Contribution Agreement ” means that certain
Contribution Agreement dated as of January 1, 1997 between CMS
and the Partnership pursuant to which CMS contributed the assets
described therein to the Partnership.
“ Secondary
Return ” means, with respect to each of the General
Partner and the Class B Limited Partner as of any date of
determination, an amount equal to 5.8% per annum , accruing
daily on a 30/360 basis and cumulative and compounded quarterly
from July 1, 2003 to such date of determination, of such
Partner’s Unrecovered Capital on each such day of
accrual. In each instance where this Agreement requires that
the Secondary Return be determined for a period less than the
period beginning on July 1, 2003 and ending on the date of
determination, such determination shall be made by substituting
the
18
first day of such lesser period for
July 1, 2003 in the preceding sentence. For purposes of
calculating the Secondary Return, “30/360
basis” means a 360-day year comprised of twelve
30-day months.
“ Service
” means the United States Internal Revenue
Service.
“ Seventh Amended
Partnership Agreement ” has the meaning set forth in
Section 1.01 hereof.
“ Tax Matters
Partner ” has the meaning set forth in
Section 8.03(a)(i) hereof.
“ Term Note to
Spartan ” has the meaning set forth in
subparagraph (v) of the definition of “Permitted
Securities.”
“ Third CMS Contribution
Agreement ” means that certain Contribution
Agreement, dated as of April 29, 1998, between CMS and the
Partnership pursuant to which CMS contributed the assets described
therein to the Partnership.
“ Transfer
” means, with respect to all or any portion of an Interest,
as a noun, any voluntary or involuntary transfer, sale, pledge or
other disposition and, as a verb, voluntarily or involuntarily to
transfer, sell, pledge or otherwise dispose of.
“ Unrecovered
Capital ”
means, for any Partner as of any date, the remainder, if any, of
(i) the sum of the balance in such Partner’s Capital
Account as of June 16, 1997 (that is, $13,630,385 for IMS AG,
$650,000 for Utrecht, $99,350,000 for Edam, and $400,701,388 for
CMS) plus the value of all Additional Capital Contributions
made by such Partner (that is, $499,613,000 for CMS), minus
(ii) the cumulative amount of money and the Gross Asset Value
of any Property (other than money) distributed to such Partner (or
its predecessors in interest) pursuant to Section 10.08(b)
hereof (other than pursuant to Section 10.08(b)(ii) hereof) as
of such date .
“ Utrecht
” means, Utrecht-America Finance Co., a Delaware
corporation.
“ Voluntary
Bankruptcy ” has the meaning set forth in the
definition of “Bankruptcy.”
“ Wholly Owned
Affiliate ” of any Person means (i) an Affiliate
of such Person 100% of the capital stock (or its equivalent in the
case of entities other than corporations) of which is owned
beneficially by such Person, directly, or indirectly through one or
more Wholly Owned Affiliates, or by any Person who, directly or
indirectly, owns beneficially 100% of the capital stock (or its
equivalent in the case of entities other than corporations) of such
Person, and (ii) an Affiliate of such Person who, directly or
indirectly, owns beneficially 100% of the capital stock (or its
equivalent in the case of entities other than corporations) of such
Person; provided that, for purposes of determining the
ownership of the capital stock of any Person,
de minimis amounts of stock held by directors, nominees
and similar persons pursuant to statutory or regulatory
requirements shall not be taken into account.
19
Unless the content shall require
otherwise:
(a)
Words importing the singular number or plural number shall include
the plural number and singular number respectively;
(b)
Words importing the masculine gender shall include the feminine and
neuter genders and vice versa;
(c)
Reference to “include,” “includes,” and
“including” shall be deemed to be followed by the
phrase “without limitation;” and
(d)
Reference in this Agreement to “herein,”
“hereby” or “hereunder”, or any similar
formulation, shall be deemed to refer to this Agreement as a whole,
including the Exhibits.
ARTICLE
II
PARTNERS’
CAPITAL CONTRIBUTIONS
Simultaneously with the execution
and delivery of this Agreement, the Class B Limited Partner
shall make a Capital Contribution consisting of the 2003 CMS
Improvements pursuant to the Fifth CMS Contribution
Agreement. The Partners hereby agree that the initial Gross
Asset Value of the 2003 CMS Improvements shall be
$246,679,000.
SECTION 2.0 2. Additional Capital
Contributions.
(a)
In general
. Each IMS Health
Partner may contribute from time to time such additional cash or
other property as it may determine; provided that, any
Capital Contribution of property made by such Partner pursuant to
this Section 2.02 shall consist of Permitted Assets other than
Leased Assets.
(b)
General Partner
. The
General Partner shall make Additional Capital Contributions in cash
from time to time if, and to the extent, necessary to maintain for
itself a Percentage Interest equal to not less than one percent
(1%).
(c)
Initial Gross Asset
Value . The initial Gross
Asset Value of any Property (other than cash) contributed pursuant
to this Section 2.02 shall be determined as
follows:
(i)
Loans. The initial Gross
Asset Value of any loan shall be equal to its par value plus
accrued interest, if any;
(ii)
Cash Equivalents.
The
initial Gross Asset Value of any Cash Equivalent shall be equal to
its face value, less unamortized discount and plus
unamortized premium, if any;
20
(iii)
Permitted Securities.
The
initial Gross Asset Value of any Permitted Security shall be equal
to its Market Value.
SECTION 2.03 . Obligations Under Contribution
Agreements.
(a)
Any payment
required to be made by CMS pursuant to any indemnification
provision of the CMS Additional Contribution Agreement, the Second
CMS Contribution Agreement, the Third CMS Contribution Agreement,
the Fourth CMS Contribution Agreement or the Fifth CMS Contribution
Agreement, as the case may be, shall be treated for income tax
purposes as a contribution to the Partnership by CMS so long as CMS
or an Affiliate thereof, as the case may be, is a Partner in the
Partnership at the time of payment; provided, however , that
(i) such payments will not be treated as a contribution for
purposes of determining the Capital Account, Percentage Interest,
Capital Contribution or Unrecovered Capital of any Partner, and
(ii) to the extent that any payment is required to be made to
the Partnership by CMS pursuant to any indemnification provision of
the CMS Additional Contribution Agreement, the Second CMS
Contribution Agreement, the Third CMS Contribution Agreement, the
Fourth CMS Contribution Agreement or the Fifth CMS Contribution
Agreement, as the case may be, and such payment is either indemnity
for the payment by the Partnership of an item that is deductible
for income tax purposes or results in an increase in the basis of
any Partnership asset that is depreciable, amortizable, or subject
to cost recovery, any such deduction or cost recovery allowance
shall not be taken into account in determining Profits, Losses or
other items of deduction or loss allocable pursuant to
Article III hereof, but shall be specially allocated to CMS
for income tax purposes, and such special allocation shall not
affect the Capital Account, Percentage Interest, Capital
Contribution or Unrecovered Capital of any Partner.
(b)
In the event any
payment is required to be made by the Partnership to CMS to return
any payment received by it from CMS pursuant to any indemnification
provision of the CMS Additional Contribution Agreement, the Second
CMS Contribution Agreement, the Third CMS Contribution Agreement,
the Fourth CMS Contribution Agreement or the Fifth CMS Contribution
Agreement, as the case may be, such payment shall be treated for
income tax purposes as a distribution by the Partnership to CMS so
long as CMS or an Affiliate thereof, as the case may be, is a
Partner in the Partnership at the time of receipt of payment;
provided , however , that (i) such payment will
not be treated as a distribution for purposes of determining the
Capital Account, Percentage Interest, Capital Contribution or
Unrecovered Capital of any Partner, and (ii) to the extent
that any payment is required to be made by the Partnership to CMS
to return any payment received by it from CMS pursuant to any
indemnification provision of the CMS Additional Contribution
Agreement, the Second CMS Contribution Agreement, the Third CMS
Contribution Agreement, the Fourth CMS Contribution Agreement or
the Fifth CMS Contribution Agreement, as the case may be, and such
payment is indemnity for the receipt by the Partnership of an item
that constitutes income for income tax purposes, such income shall
not be taken into account in determining Profits, Losses or other
items of income or gain allocable pursuant to Article III
hereof, but shall be specially allocated to CMS for income tax
purposes, and such special allocation shall not affect the Capital
Account, Percentage Interest, Capital Contribution or Unrecovered
Capital of any Partner.
21
(a)
Except as
otherwise provided in Section 10.08, Articles XII and XIV
hereof or in the Act, no Partner shall demand or receive a return
of its Capital Contributions or withdraw from the Partnership
without the consent of all Partners. Under circumstances
requiring a return of any Capital Contributions, no Partner shall
have the right to receive Property other than cash except as may be
specifically provided in this Agreement.
(b)
No Partner shall
receive any interest or draw with respect to its Capital
Contributions or its Capital Account, except as otherwise provided
in this Agreement.
(c)
The Limited
Partners shall not be liable for the debts, liabilities, contracts
or any other obligations of the Partnership. Except as
otherwise provided by mandatory provisions of applicable state law
and except with respect to the obligation of any Limited Partner to
return to the Partnership a distribution made to such Limited
Partner in violation of the Act at a time when such Limited Partner
knew the distribution would violate the Act, such Limited Partner
shall not be required to lend any funds to the Partnership or to
make any additional Capital Contributions to the Partnership.
The General Partner shall not have any personal liability for any
repayment of any Capital Contributions of any Limited
Partner.
SECTION 2.05 . Capital Accounts and Percentage
Interests.
The Capital Accounts and Percentage
Interests of each Partner as of the Closing Date, which give effect
to all Capital Contributions made prior to the Closing Date, are as
follows:
|
Name
|
|
Closing Date
Capital Account
|
|
Percentage
Interest
|
|
|
GENERAL PARTNER:
|
|
|
|
|
|
|
IMS AG
|
|
|
|
|
|
|
|
|
$
|
16,847,197
|
|
1.50
|
%
|
|
CLASS A LIMITED
PARTNERS:
|
|
|
|
|
|
|
Utrecht-America Finance
Co.
|
|
$
|
657,757
|
|
0.06
|
%
|
|
|
|
|
|
|
|
|
Edam, L.L.C.
|
|
$
|
100,535,444
|
|
8.94
|
%
|
|
|
|
|
|
|
|
|
CLASS B LIMITED
PARTNER:
|
|
|
|
|
|
|
Coordinated Management Systems,
Inc.
|
|
$
|
1,006,432,894
|
|
89.50
|
%
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
1,124,473,292
|
|
100.00
|
%
|
22
After giving effect to the special
allocations set forth in Sections 3.04 and 3.05 hereof, but
before giving effect to the special allocations set forth in
Section 3.03 hereof, Profits for any Allocation Year shall be
allocated in the following order and priority:
(a)
First, 100% to
the Class A Limited Partners in proportion to and to the extent of
an amount equal to the remainder, if any, of (i) the
cumulative Priority Return of each Class A Limited Partner
from July 1, 2003 through the last day of such Allocation
Year, minus (ii) the cumulative Profits allocated to
such Class A Limited Partner pursuant to this Section 3.01(a)
for all prior Allocation Years;
(b)
Second, 100% to
the General Partner and the Class B Limited Partner in proportion
to and to the extent of an amount equal to the remainder, if any,
of (i) the cumulative Secondary Return of each such Partner
from July 1, 2003 through the last day of such Allocation
Year, minus (ii) the cumulative Profits allocated to
such Partner pursuant to this Section 3.01(b) for all prior
Allocation Years;
(c)
Third, 100% to
the General Partner, in an amount equal to the remainder, if any,
of (i) the sum of (A) the cumulative Losses allocated to
the General Partner pursuant to Section 3.02(d) hereof for all
prior Allocation Years, and (B) the cumulative items of loss
allocated to the General Partner pursuant to
Section 3.03(b)(iv) hereof for all prior Allocation Years,
minus (ii) the sum of (A) the cumulative Profits
allocated to the General Partner pursuant to this
Section 3.01(c) for all prior Allocation Years, and
(B) the cumulative items of gain allocated to the General
Partner pursuant to Section 3.03(a)(i) hereof for all prior
Allocation Years;
(d)
Fourth, 100% to
the Class A Limited Partners in proportion to and to the extent of
an amount equal to the remainder, if any, of (i) the sum of
(A) the cumulative Losses allocated to each Class A Limited
Partner pursuant to Section 3.02(c) hereof for all prior
Allocation Years, and (B) the cumulative items of loss allocated to
such Class A Limited Partner pursuant to
Section 3.03(b)(iii) hereof for all prior Allocation Years,
minus (ii) the sum of (A) the cumulative Profits
allocated to such Class A Limited Partner pursuant to this
Section 3.01(d) for all prior Allocation Years, and (B) the
cumulative items of gain allocated to such Class A Limited
Partner pursuant to Section 3.03(a)(ii) hereof for all prior
Allocation Years;
(e)
Fifth, 99% to the
General Partner and the Class B Limited Partner in proportion to
their Percentage Interests and 1% to the Class A Limited Partners
in proportion to their Percentage Interests, to the extent of an
amount equal to the remainder, if any, of (i) the sum of
(A) the cumulative Losses allocated to each such Partner
pursuant to Section 3.02(b) hereof for all prior Allocation
Years, and (B) the cumulative items of loss allocated to such
Partner pursuant to Section 3.03(b)(ii) hereof for all prior
Allocation Years, minus (ii) the sum of (A) the
cumulative Profits allocated to such Partner pursuant to this
Section 3.01(e) for all prior
23
Allocation Years, and
(B) the cumulative items of gain allocated to such Partner
pursuant to Section 3.03(a)(iii) hereof for all prior
Allocation Years; and
(f)
Sixth, the
balance, if any, 99% to the General Partner and the Class B Limited
Partner in proportion to their Percentage Interests and 1% to the
Class A Limited Partners in proportion to their Percentage
Interests.
After giving effect to the special
allocations set forth in Sections 3.04 and 3.05 hereof, but
before giving effect to the special allocations set forth in
Section 3.03 hereof, Losses for any Allocation Year shall be
allocated in the following order and priority, subject to the
limitations in Section 3.06 hereof:
(a)
First, to the
Partners in proportion to and to the extent of an amount equal to
the remainder, if any, of (i) the sum of (A) the
cumulative Profits allocated to each such Partner pursuant to
Section 3.01(f) hereof for all prior Allocation Years, and
(B) the cumulative items of gain allocated to such Partner
pursuant to Section 3.03(a)(iv) hereof for all prior
Allocation Years, minus (ii) the sum of (A) the
cumulative Losses allocated to such Partner pursuant to this
Section 3.02(a) for all prior Allocation Years, and
(B) the cumulative items of loss allocated to such Partner
pursuant to Section 3.03(b)(i) hereof for all prior Allocation
Years;
(b)
Second, 99% to
the General Partner and the Class B Limited Partner in proportion
to their Percentage Interests and 1% to the Class A Limited
Partners in proportion to their Percentage Interests until the
Capital Account of the General Partner and the Class B Limited
Partner is equal to zero;
(c)
Third, 100% to
the Class A Limited Partners in proportion to their Percentage
Interests until the Capital Account of each Class A Limited Partner
is equal to zero; and
(d)
Fourth, the
balance, if any, 100% to the General Partner.
SECTION 3.03 . Special Gain and Loss
Allocations.
After giving effect to the special
allocations set forth in Sections 3.04 and 3.05 hereof and the
allocations of Profits or Losses set forth in Sections 3.01 or
3.02 hereof, as the case maybe, certain gains and losses shall be
specially allocated as follows:
(a)
Special Gain
Allocations .
In the event
that in any Allocation Year the aggregate items of gain realized or
deemed to be realized by the Partnership from the sale, disposition
or adjustment to the Gross Asset Values of Permitted Assets is
greater than the aggregate items of loss realized or deemed to be
realized by the Partnership from the sale, disposition or
adjustment to the Gross Asset Values of Permitted Assets, items of
gain equal to such excess shall be specially allocated as
follows:
24
(i)
First, 100% to the General Partner,
in an amount equal to the remainder, if any, of (i) the sum of
(A) the cumulative Losses allocated to the General Partner
pursuant to Section 3.02(d) hereof for the current and all
prior Allocation Years, and (B) the cumulative items of loss
allocated to the General Partner pursuant to
Section 3.03(b)(iv) hereof for all prior Allocation Years,
minus (ii) the sum of (A) the cumulative Profits
allocated to the General Partner pursuant to Section 3.01(c)
hereof for the current and all prior Allocation years, and
(B) the cumulative items of gain allocated to the General
Partner pursuant to this Section 3.03(a)(i) for all prior
Allocation Years;
(ii)
Second, 100% to the Class A Limited
Partners in proportion to and to the extent of an amount equal to
the remainder, if any, of (i) the sum of (A) the
cumulative Losses allocated to each Class A Limited Partner
pursuant to Section 3.02(c) hereof for the current and all
prior Allocation Years, and (B) the cumulative items of loss
allocated to such Class A Limited Partner pursuant to
Section 3.03(b)(iii) hereof for all prior Allocation Years,
minus (ii) the sum of (A) the cumulative Profits
allocated to such Partner pursuant to Section 3.01(d) hereof
for the current and all prior Allocation Years, and (B) the
cumulative items of gain allocated to such Class A Limited
Partner pursuant to this Section 3.03(a)(ii) for all prior
Allocation Years;
(iii)
Third, 99% to the General Partner
and the Class B Limited Partner in proportion to their
Percentage Interests and 1% to the Class A Limited Partners in
proportion to their Percentage Interests, to the extent of an
amount equal to the remainder, if any, of (i) the sum of
(A) the cumulative Losses allocated to each such Partner
pursuant to Section 3.02(b) hereof for the current and all
prior Allocation Years, and (B) the cumulative items of loss
allocated to such Partner pursuant to Section 3.03(b)(ii)
hereof for all prior Allocation Years, minus (ii) the
sum of (A) the cumulative Profits allocated to such Partner
pursuant to Section 3.01(e) hereof for the current and all
prior Allocation years, and (B) the cumulative items of gain
allocated to such Partner pursuant to this
Section 3.03(a)(iii) for all prior Allocation Years;
and
(iv)
Fourth, the balance, if any, 5% to
the General Partner, 1% to the Class A Limited Partners in
proportion to their Percentage Interests, and
