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Exhibit 1.1
Hospira, Inc.
$300,000,000 4.95% Notes Due 2009
$ 400,000,000 5.90% Notes Due 2014
PURCHASE AGREEMENT
June 7, 2004
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June 7, 2004
Morgan Stanley & Co. Incorporated
ABN AMRO Incorporated
Citigroup Global Markets Inc.
c/o Morgan Stanley &
Co. Incorporated
1585
Broadway
New
York, New York 10036
Dear Sirs and Mesdames:
Hospira, Inc., a Delaware corporation (the "COMPANY"), proposes to
issue
and sell to the several purchasers named in
Schedule I hereto (the "INITIAL
PURCHASERS") pursuant to this Purchase
Agreement (this "Agreement") (i)
$300,000,000 principal amount of its 4.95%
Notes Due 2009 (the "4.95% NOTES")
and (ii) $400,000,000 principal amount of
its 5.90% Notes Due 2014 (the "5.90%
NOTES," and together with the 4.95% Notes,
the "SECURITIES"). The Securities
will be issued pursuant to the provisions
of an Indenture dated as of June 14,
2004 (the "BASE INDENTURE") between the
Company and LaSalle Bank National
Association, as Trustee (the "TRUSTEE"), as
supplemented by a First Supplemental
Indenture dated June 14, 2004 (the
"SUPPLEMENTAL INDENTURE" together with the
Base Indenture, the "INDENTURE") between
the Company and the Trustee.
The
Securities will be offered without being registered under the
Securities Act of 1933, as amended (the
"SECURITIES ACT"), to qualified
institutional buyers in compliance with the
exemption from registration provided
by Rule 144A under the Securities Act, in
offshore transactions in reliance on
Regulation S under the Securities Act
("REGULATION S") and to institutional
accredited investors (as defined in Rule
501(a)(1), (2), (3) or (7) under the
Securities Act) that deliver a letter in
the form annexed to the Final
Memorandum (as defined below).
The
Initial Purchasers and their direct and indirect transferees will
be
entitled to the benefits of a Registration
Rights Agreement dated the date
hereof between the Company and the Initial
Purchasers (the "REGISTRATION RIGHTS
AGREEMENT").
In
connection with the sale of the Securities, the Company has
prepared a
preliminary offering memorandum (the
"PRELIMINARY MEMORANDUM") and will prepare
a final offering memorandum (the "FINAL
MEMORANDUM" and, with the Preliminary
Memorandum, each a "MEMORANDUM") including
or incorporating by reference a
description of the terms of the Securities,
the terms of the offering and a
description of the Company. As used herein,
the term "Memorandum" shall include
in each case the documents incorporated by
reference therein. The terms
"SUPPLEMENT", "AMENDMENT" and "AMEND" as
used herein with respect to a
Memorandum shall include all documents
deemed to be incorporated by reference in
the Preliminary Memorandum or Final
Memorandum that are filed subsequent to the
date of such Memorandum with the
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Securities and Exchange Commission (the
"COMMISSION") pursuant to the Securities
Exchange Act of 1934, as amended (the
"EXCHANGE ACT").
1.
REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to, and agrees with, you that:
(a) (i)
Each document, if any, filed or to be filed pursuant to
the
Exchange Act and incorporated by reference in either Memorandum
complied or will comply when so filed in all material respects with
the
Exchange Act and the applicable rules and regulations of the
Commission
thereunder and (ii) the Preliminary Memorandum (other than
pricing-related information) does not contain and the Final
Memorandum,
in
the form used by the Initial Purchasers to confirm sales and on
the
Closing Date (as defined in Section 4), will not contain any
untrue
statement of a material fact or omit to state a material fact
necessary
to
make the statements therein, in the light of the circumstances
under
which they were made, not misleading, except that the
representations and
warranties set forth in this paragraph do not apply to statements
or
omissions in either Memorandum based upon information relating to
any
Initial Purchaser furnished to the Company in writing by such
Initial
Purchaser through you expressly for use therein.
(b) The
Company has been duly incorporated, is validly existing
as a corporation
in good standing under the laws of the jurisdiction of
its
incorporation, has the corporate power and authority to own its
property and to conduct its business as described in each
Memorandum and
is
duly qualified to transact business and is in good standing in
each
jurisdiction in which the conduct of its business or its ownership
or
leasing of property requires such qualification, except to the
extent
that
the failure to be so qualified or be in good standing would not
have
a
material adverse effect on the Company and its subsidiaries, taken
as a
whole.
(c) Each
"significant subsidiary" of the Company (as such term
is
defined in Rule 1-02(w) of Regulation S-X promulgated under the
Securities Act) has been duly incorporated or formed, is validly
existing
as a
corporation or limited liability company in good standing under
the
laws
of the jurisdiction of its incorporation or formation, has the
power
and
authority, corporate or other, to own its property and to conduct
its
business as described in each Memorandum and is duly qualified
to
transact business and is in good standing in each jurisdiction in
which
the
conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure
to be
so
qualified or be in good standing would not have a material
adverse
effect on the Company and its subsidiaries, taken as a whole; all
of the
issued shares of capital stock or membership interests of each
subsidiary
of
the Company have been duly and validly authorized and issued,
are
fully paid and non-assessable and are owned directly by the
Company, free
and
clear of all liens, encumbrances or claims.
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(d) This
Agreement has been duly authorized, executed and
delivered by the Company.
(e) The
Company has an authorized capitalization as set forth
in
the Memorandum, and all issued shares of common stock of the
Company
outstanding on the date hereof have been duly authorized and are
validly
issued, fully paid and non-assessable.
(f) The
Securities have been duly authorized and, when executed
and
authenticated in accordance with the provisions of the Indenture
and
delivered to and paid for by the Initial Purchasers in accordance
with
the terms
of this Agreement, will be valid and binding obligations of the
Company, enforceable in accordance with their terms, subject to
applicable bankruptcy, insolvency or similar laws affecting
creditors'
rights generally and general principles of equity, and will be
entitled
to
the benefits of the Indenture pursuant to which such Securities are
to
be
issued and the Registration Rights Agreement, subject to
applicable
bankruptcy, insolvency or similar laws affecting creditors'
rights
generally and general principles of equity and except as rights
to
indemnification and contribution under the Registration Rights
Agreement
may
be limited under applicable law.
(g) Each
of the Indenture and the Registration Rights Agreement
has
been duly authorized, executed and delivered by, and is a valid
and
binding agreement of, the Company, enforceable in accordance with
its
terms, subject to applicable bankruptcy, insolvency or similar
laws
affecting creditors' rights generally and general principles of
equity
and
except as rights to indemnification and contribution under the
Registration Rights Agreement may be limited under applicable
law.
(h) The
execution and delivery by the Company of, and the
performance by the Company of its obligations under, this
Agreement, the
Indenture, the Registration Rights Agreement and the Securities
will not
contravene any provision of applicable law or the certificate
of
incorporation or by-laws of the Company or any agreement or
other
instrument binding upon the Company or any of its subsidiaries that
is
material to the Company and its subsidiaries, taken as a whole, or
any
judgment, order or decree of any governmental body, agency or
court
having jurisdiction over the Company or any subsidiary, and no
consent,
approval, authorization or order of, or qualification with, any
governmental body or agency is required for the performance by
the
Company of its obligations under this Agreement, the Indenture,
the
Registration Rights Agreement or the Securities, except such as may
be
required by the securities or Blue Sky laws of the various states
in
connection with the offer and sale of the Securities and by Federal
and
state securities laws with respect to the Company's obligations
under the
Registration Rights Agreement.
(i) Except as set forth in each
Memorandum, there has not
occurred any material adverse change in the condition, financial
or
otherwise, or in the
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earnings, business, properties or operations of the Company and
its
subsidiaries, taken as a whole (a "MATERIAL ADVERSE EFFECT"), or
any
development which would reasonably be expected to have a Material
Adverse
Effect, from that set forth in the Preliminary Memorandum; except
as
disclosed in the Preliminary Memorandum, neither the Company nor
any of
its
subsidiaries has sustained since the date of the latest audited
financial statements included in the Preliminary Memorandum any
loss or
interference with its business from fire, explosion, flood or
other
calamity, whether or not covered by insurance, or from any labor
dispute
or
court or governmental action, order or decree, which would
reasonably
be
expected to have a Material Adverse Effect; and, except as set
forth
in
each Memorandum, since the date as of which information is given
in
the
Preliminary Memorandum, there has not been any material change in
the
consolidated capital stock or any material increase in the
consolidated
long-term debt of the Company and its subsidiaries.
(j) There
are no legal or governmental proceedings or
investigations pending or, to the knowledge of the Company,
threatened to
which the Company or any of its subsidiaries is a party or to which
any
of
the properties of the Company or any of its subsidiaries is
subject
(including, without limitation, any proceedings before the United
States
Food
and Drug Administration or comparable, state, local or foreign
governmental bodies or any investigations related to Medicare
reimbursement), other than proceedings accurately described in
all
material respects in each Memorandum and proceedings that would
not
reasonably be
expected to have a Material Adverse Effect, or a material
adverse effect on the power or ability of the Company to perform
its
obligations under this Agreement, the Indenture, the Registration
Rights
Agreement or the Securities or to consummate the transactions
contemplated by the Final Memorandum.
(k) The
Company and its subsidiaries (i) are in compliance with
all
applicable foreign, federal, state and local laws and
regulations
relating to the protection of human health and safety, the
environment or
hazardous or toxic substances or wastes, pollutants or
contaminants
("ENVIRONMENTAL LAWS"), (ii) have received all permits, licenses or
other
approvals required of them under applicable Environmental Laws to
conduct
their respective businesses and (iii) are in compliance with all
terms
and
conditions of any such permit, license or approval, except where
such
noncompliance with Environmental Laws, failure to receive
required
permits, licenses or other approvals or failure to comply with the
terms
and
conditions of such permits, licenses or approvals would not,
individually or in the aggregate, have a Material Adverse
Effect.
(l) There
are no costs or liabilities associated with
Environmental Laws (including, without limitation, any capital
or
operating expenditures required for clean-up, closure of properties
or
compliance with Environmental Laws or any permit, license or
approval,
any
related constraints on operating activities and any potential
liabilities to third parties) which would, individually or in
the
aggregate, have a Material Adverse Effect.
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(m) Except
as noted therein, the consolidated financial
statements, and the related notes thereto, included in each
Memorandum
present fairly the consolidated financial position of the Company
and its
consolidated subsidiaries as of the dates indicated and the results
of
their operations and changes in their consolidated cash flows for
the
periods specified; and such financial statements have been prepared
in
conformity with generally accepted accounting principles in the
United
States applied on a consistent basis; and the pro forma
financial
information, and the related notes thereto, included in each
Memorandum
fairly present in all material respects the information contained
therein
and
have been prepared on a reasonable basis using reasonable
assumptions
and
on a basis consistent with the segment accounting principles
and
policies of the Company reflected in such financial statements.
(n) The
Company and its subsidiaries (i) make and keep accurate
books and records in all material respects and (ii) maintain
internal
accounting controls which provide reasonable assurance that (A)
transactions are executed in accordance with management's
authorization,
(B)
transactions are recorded as necessary to permit preparation of
its
financial statements and to maintain accountability for its assets,
(C)
access to its assets is permitted only in accordance with
management's
authorization and (D) the reported accountability for its assets
is
compared with existing assets at reasonable intervals and
appropriate
action is taken with respect to any difference.
(o) The
Company has established, maintains and will maintain
disclosure controls and procedures (as defined as Rule 13a-14 of
the
Exchange Act) which are designed to ensure that information
required to
be
disclosed by the Company in the reports that it files or submits
under
the
Exchange Act is recorded, processed, summarized and reported in
accordance with the Exchange Act and the rules and regulations
thereunder. The Company has carried out and will carry out
evaluations,
under the supervision and with the participation of the
Company's
management, of the effectiveness of the design and operation of
the
Company's disclosure controls and procedures in accordance with
Rule
13a-15 of the
Exchange Act.
(p) The
Company has good and marketable title to all assets
owned by it, in each case free from liens, encumbrances and defects
that
would materially affect the value thereof or materially interfere
with
the
use made or to be made thereof by it.
(q) Except
as set forth in each Memorandum, the Company and its
subsidiaries possess adequate certificates, authorities or permits
issued
by
appropriate governmental agencies or bodies necessary to conduct
the
business now operated by them and have not received any notice
of
proceedings relating to the revocation or modification of any
such
certificate, authority or permit that, if determined adversely to
the
Company, would individually or in the aggregate, have a Material
Adverse
Effect.
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(r) The
Company is not, and after giving effect to the offering
and
sale of the Securities and the application of the proceeds thereof
as
described in the Final Memorandum, will not be required to register
as an
"investment company" as such term is defined in the Investment
Company
Act
of 1940, as amended (the "Investment Company Act").
(s)
Neither the Company nor any affiliate (as defined in Rule
501(b) of Regulation D under the Securities Act, an "AFFILIATE") of
the
Company has directly, or through any agent (other than the
Initial
Purchasers), (i) sold, offered for sale, solicited offers to buy
or
otherwise negotiated in respect of, any security (as defined in
the
Securities Act) which is or will be integrated with the sale of
the
Securities in a manner that would require the registration under
the
Securities Act of the Securities or (ii) offered, solicited offers
to buy
or
sold the Securities by any form of general solicitation or
general
advertising (as those terms are used in Rule 502(c) of Regulation D
under
the
Securities Act) or in any manner involving a public offering
within
the
meaning of Section 4(2) of the Securities Act.
(t) None
of the Company, its Affiliates or any person acting on
its
or their behalf (other than the Initial Purchasers) has engaged
or
will
engage in any directed selling efforts (within the meaning of
Rule
902(b) of Regulation S) with respect to the Securities and the
Company
and
its Affiliates and any person acting on its or their behalf
(other
than
the Initial Purchasers) have complied and will comply with the
offering restrictions requirement of Regulation S with respect to
the
offering of the Securities outside of the United States, except
no
representation, warranty or agreement is made by the Company in
this
paragraph with respect to the Initial Purchasers.
(u) It is
not necessary in connection with the offer, sale and
delivery of the Securities to the Initial Purchasers in the
manner
contemplated by this Agreement to register the Securities under
the
Securities Act or to qualify the Indenture under the Trust
Indenture Act
of
1939, as amended.
(v) The Securities satisfy
the requirements set forth in Rule
144A(d)(3) under the Securities Act.
(w) The
Company has not entered and will not enter into any
contractual arrangement with respect to the distribution of the
Securities except for this Agreement and the Registration
Rights
Agreement.
(x) The
Company and, to the knowledge of the Company, its
affiliates have not taken and will not take, directly or
indirectly, any
action designed to
cause, or result in, or which has constituted or which
might reasonably be expected to constitute, the stabilization
or
manipulation of the price of the Securities.
(y) The
Company or, to the knowledge of the Company, any other
person associated with or acting on behalf of the Company
including,
without
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limitation, any director, officer, agent or employee of the Company
or
its
subsidiaries, has not, directly or indirectly, while acting on
behalf
of
the Company or its subsidiaries (i) used any corporate funds
for
unlawful contributions, gifts, entertainment or other unlawful
expenses
relating to political activity; (ii) made any unlawful payment to
foreign
or
domestic government officials or employees or to foreign or
domestic
political parties or campaigns from corporate funds; (iii) violated
any
provision of the Foreign Corrupt Practices Act of 1977, as amended;
or
(iv)
made any other unlawful payment.
(z) The
operations of the Company and its subsidiaries are and
have
been conducted at all times in material compliance with
applicable
financial record keeping and reporting requirements of the Currency
and
Foreign Transactions Reporting Act of 1970, as amended, the
money
laundering statutes of all jurisdictions, the rules and
regulations
thereunder and any related or similar rules, regulations or
guidelines,
issued, administered or enforced by any governmental agency
(collectively, the "MONEY LAUNDERING LAWS") and no action, suit
or
proceeding by or before any court or governmental agency, authority
or
body
or any arbitrator involving the Company or any of its
subsidiaries
with
respect to the Money Laundering Laws is pending, or to the
knowledge
of
the Company, threatened.
(aa) Neither the
Company nor any of its subsidiaries nor, to the
knowledge of the Company, any director, officer, agent, employee
or
affiliate of the Company or any of its subsidiaries is currently
subject
to
any U.S. sanctions administered by the Office of Foreign Assets
Control of the U.S. Treasury Department ("OFAC"); and the Company
will
not
directly or indirectly use the proceeds of the offering of the
Securities, or lend, contribute or otherwise make available such
proceeds
to
any subsidiary, joint venture partner or other person or entity,
for
the
purpose of financing the activities of any person currently
subject
to
any U.S. sanctions administered by OFAC.
2.
AGREEMENTS TO SELL AND PURCHASE. The Company hereby agrees to
sell
to the several Initial Purchasers, and each
Initial Purchaser, upon the basis of
the representations and warranties herein
contained, but subject to the
conditions hereinafter stated, agrees,
severally and not jointly, to purchase
from the Company, at a purchase price of
(i) 99.347% of the principal amount of
the 4.95% Notes and (ii) 99.081% of the
principal amount of the 5.90% Notes, in
the respective principal amounts of the
Securities set forth opposite its name
in Schedule I hereto.
3.
TERMS OF OFFERING. You have advised the Company that the
Initial
Purchasers will make an offering of the
Securities purchased by the Initial
Purchasers hereunder on the terms to be set
forth in the Final Memorandum, as
soon as practicable after this Agreement is
entered into as in your judgment is
advisable.
4.
PAYMENT AND DELIVERY. Payment for the Securities shall be made
to
the Company in Federal or other funds
immediately available in New York City
against delivery of such Securities for the
respective accounts of the several
Initial Purchasers at
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10:00 a.m., New York City time, on June 14,
2004, or at such other time on the
same or such other date, not later than
June 14, 2004, as shall be designated in
writing by you. The time and date of such
payment are hereinafter referred to as
the "CLOSING DATE."
Certificates for the Securities shall be in definitive form or
global
form, as specified by you, and registered
in such names and in such
denominations as you shall request in
writing not later than one full business
day prior to the Closing Date. The
certificates evidencing the Securities shall
be delivered to you on the Closing Date for
the respective accounts of the
several Initial Purchasers, with any
transfer taxes payable in connection with
the transfer of the Securities to the
Initial Purchasers duly paid, against
payment of the purchase price therefor plus
accrued interest, if any, to the
date of payment and delivery.
5.
CONDITIONS TO THE INITIAL PURCHASERS' OBLIGATIONS. The several
obligations of the Initial Purchasers to
purchase and pay for the Securities on
the Closing Date are subject to the
following conditions:
(a)
Subsequent to the execution and delivery of this Agreement
and
prior to the Closing Date:
(i) there
shall not have occurred any downgrading, nor
shall any notice have been given of any intended or potential
downgrading or of any review for a possible change that does
not
indicate the direction of the possible change, in the rating
accorded any of the Company's securities by any "nationally
recognized statistical rating organization," as such term is
defined for purposes of Rule 436(g)(2) under the Securities
Act;
and
(ii) there shall
not have occurred any change, or any
development which would reasonably be expected to have a
change,
in the condition, financial or otherwise, or in the earnings,
business, properties or operations of the Company and its
subsidiaries, taken as a whole, from that set forth in the
Preliminary Memorandum (exclusive of any amendments or
supplements
thereto subsequent to the date of this Agreement) that, in your
judgment, is material and adverse and that makes it, in your
judgment, impracticable or inadvisable to market the Securities
on
the terms and in the manner contemplated in the Final
Memorandum.
(b) The
Initial Purchasers shall have received on the Closing
Date
a certificate, dated the Closing Date and signed by an
executive
officer of the Company who has specific knowledge of the
Company's
financial matters, and is reasonably satisfactory to the
Initial
Purchasers, to the effect set forth in Section 5(a)(i) and (ii) and
to
the
effect that the representations and warranties of the Company
contained in this Agreement are true and correct as of the Closing
Date
and
that the Company has complied in all material respects with all
of
the
agreements and satisfied in all material respects all of the
conditions on its part to be performed or satisfied hereunder on
or
before the Closing Date.
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The officer signing and delivering such certificate may rely
upon
his
or her knowledge as to proceedings threatened.
(c) The
Initial Purchasers shall have received on the Closing
Date
an opinion of Mayer, Brown, Rowe & Maw LLP, outside counsel for
the
Company, dated the Closing Date, to the effect set forth in Exhibit
A
hereto.
(d) The
Initial Purchasers shall have received on the Closing
Date
an opinion of Brian J. Smith, General Counsel of the Company
(or
such
other person who shall be General Counsel of the Company on the
Closing Date), dated the Closing Date, to the effect set forth in
Exhibit
B
hereto.
(e) The
Initial Purchasers shall have received on the Closing
Date
an opinion of Skadden, Arps, Slate, Meagher & Flom LLP, counsel
for
the
Initial Purchasers, such opinion or opinions, dated the Closing
Date,
with
respect to such matters as the Initial Purchasers may
reasonably
request, and the Company shall have furnished to such counsel
such
documents as they reasonably request for the purpose of enabling
them to
pass
upon such matters.
(f) The
Initial Purchasers shall have received on each of the
date
hereof and the Closing Date a letter, dated the date hereof or
the
Closing Date, as the case may be, in form and substance
satisfactory to
the
Initial Purchasers, from Deloitte & Touche LLP and Ernst &
Young LLP,
independent public accountants, containing statements and
information of
the
type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and
certain
financial information contained in or incorporated by reference
into the
Final Memorandum; PROVIDED that the letter delivered on the Closing
Date
shall use a "cut-off date" not earlier than the date hereof.
The Company will furnish the Initial
Purchasers with such conformed copies of
such opinions, certificates, letters and
documents as the Initial Purchasers
reasonably request. The Initial Purchasers
may in their sole discretion waive
compliance with any conditions to the
obligations of the Initial Purchasers
hereunder.
6.
COVENANTS OF THE COMPANY. In further consideration of the
agreements of the Initial Purchasers
contained in this Agreement, the Company
covenants with each Initial Purchaser as
follows:
(a) To
furnish to you in New York City, without charge, prior
to
10:00 a.m. New York City time on the business day next succeeding
the
date
of this Agreement and during the period mentioned in Section
6(c),
as
many copies of the Final Memorandum and any supplements and
amendments
thereto as you may reasonably request.
(b) Before
amending or supplementing either Memorandum, to
furnish to you a copy of each such proposed amendment or supplement
and
not
to use any such proposed amendment or supplement to which you
reasonably object in writing.
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(c) If,
during such period after the date hereof and prior to
the
date on which all of the Securities shall have been sold by the
Initial Purchasers, any event shall occur or condition exist as a
result
of
which it is necessary to amend or supplement the Final Memorandum
in
order to make the statements therein, in the light of the
circumstances
when
the Final Memorandum is delivered to a purchaser, not misleading,
or
if,
in the reasonable opinion of counsel for the Initial Purchasers,
it
is
necessary to amend or supplement the Final Memorandum to comply
with
applicable law, for
