Exhibit 10.18
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
In re: ) Chapter 11
)
W.R. GRACE & CO., et al., ) Case Nos. 01-1139 through 01-1200
)
Debtors. )
___________________________________________)
)
OFFICIAL COMMITTEE OF ASBESTOS )
PERSONAL INJURY CLAIMANTS, et al., )
)
Plaintiffs, )
)
-against- ) Adv. No. 02-2210
) [LEAD DOCKET]
SEALED AIR CORPORATION and )
CRYOVAC, INC., )
)
Defendants. )
___________________________________________)
)
OFFICIAL COMMITTEE OF ASBESTOS )
PERSONAL INJURY CLAIMANTS and )
OFFICIAL COMMITTEE OF ASBESTOS )
PROPERTY DAMAGE CLAIMANTS OF )
W.R. GRACE & CO., suing in behalf of the )
Chapter 11 Bankruptcy Estate of W.R. )
GRACE & CO., et al., )
)
Plaintiffs, )
)
-against- ) Adv. No. 02-2211
)
FRESENIUS MEDICAL CARE HOLDINGS, ) Affects Docket 02-2211 only
INC. and NATIONAL MEDICAL CARE, INC. )
)
Defendants. )
SETTLEMENT AGREEMENT
AND RELEASE OF CLAIMS
This Settlement Agreement and Release of Claims (the "Agreement") is
made as of the 6th day of February, 2003, by and among Fresenius Medical Care
Holdings, Inc. (taxpayer identification number 13-3461988) ("FMCH"), National
Medical Care, Inc. (taxpayer identification number 04-2835488) ("NMC"), the
Official Committee of Asbestos Personal Injury Claimants (the "PI Committee"),
and the Official Committee of Asbestos Property Damage Claimants (the "PD
Committee," and collectively with the PI Committee, the "Asbestos Committees"),
both of the Asbestos Committees in their respective capacities as plaintiffs on
behalf of the estates of the Debtors in the Asbestos Claimants' Adversary
Proceeding.
ARTICLE I
DEFINITIONS
Capitalized terms used in this Agreement shall have the meanings
(such meanings to be equally applicable to both the singular and the plural
forms of the terms defined) assigned to such terms in Appendix A attached hereto
or in the Preamble above. Appendix A is incorporated herein by reference, and is
fully part of this Agreement.
ARTICLE II
TERMS OF SETTLEMENT OF CLAIMS
2.01 Moving Parties to Seek Approval of Settlement. Within thirty (30)
days of the Settlement Execution Date, the Moving Parties shall move the Court
to enter an order binding on all of the Estate Parties (including the Settling
Parties) approving this Agreement and obligating each of the Estate Parties to
the terms and conditions of this Agreement as if each of the Estate Parties had
executed this Agreement.
2.02 Preconditions to Settlement Payment Obligation. As a condition
precedent to the obligation of the NMC Defendants to make the Settlement
Payment, each and every of the
following preconditions shall have occurred, unless the NMC Defendants, in their
sole discretion, have provided written notice to the other Settling Parties and
the Court that they waive one or more of the preconditions:
(A) Releases by the Estate Parties. The Plan of Reorganization shall
provide that: (i) upon the making of the Settlement Payment, the Asbestos
Committees and the Estate Parties will fully, finally, and forever release,
relinquish and discharge each and every of the NMC Defendants from any and all
Grace-Related Claims that the Asbestos Committees or the Estate Parties have
asserted or could have asserted in this or any other forum against any of the
NMC Defendants; and (ii) prior to the making of the Settlement Payment, the
Asbestos Committees and the Estate Parties will deliver to the NMC Defendants
the Release that is attached as Appendix B hereto, which by its terms shall
become effective upon the making of the Settlement Payment.
(B) Releases by Plan Claimants. The Plan of Reorganization shall
provide that any Person that votes in favor of the Plan or that receives
property under the Plan shall thereby be deemed, upon the making of the
Settlement Payment, to have fully and finally released each and every of the NMC
Defendants from all Grace-Related Claims that such Person has asserted or could
have asserted in this or any other forum against any of the NMC Defendants.
(C) Releases by Trust Claimants. The Plan of Reorganization shall
provide for the establishment of a trust or trusts under state law and pursuant
to Section 524(g) of the Bankruptcy Code (the "Asbestos Trust"), and the Plan of
Reorganization further shall provide that any Person that receives property from
the Asbestos Trust shall thereby be deemed, upon and after the making of the
Settlement Payment, to have fully and finally released each and every
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of the NMC Defendants from all Grace-Related Claims that the Person has asserted
or could have asserted in this or any other forum against any of the NMC
Defendants.
(D) Bar Order. The Court shall have issued, pursuant to Section
105(a) of the Bankruptcy Code, a Final Order, effective upon the making of the
Settlement Payment, permanently and forever enjoining, restraining and barring
any Person from commencing or continuing any suit, action or other proceeding,
or from taking any other action, for the purpose of, directly or indirectly,
collecting, recovering, or receiving payment of, or with respect to, any
Grace-Related Claim against any of the NMC Defendants.
(E) Channelling Injunction. In addition to the injunction described
in (D) above, the Final Order confirming the Plan of Reorganization shall
provide that, effective upon the making of the Settlement Payment, the NMC
Defendants shall receive the full benefits and protections of an injunction
entered pursuant to section 524(g) of the Bankruptcy Code, which injunction
shall permanently bar any Person from commencing or continuing any suit, action,
or other proceeding, or from taking any other action for the purpose of,
directly or indirectly, collecting, recovering, or receiving payment of, or with
respect to, any Asbestos-Related Claim that the Person asserted or could have
asserted, against any of the NMC Defendants.
(F) Indemnification. The Plan of Reorganization shall provide that
the Estate Parties, jointly and severally, upon the making of the Settlement
Payment, shall indemnify, defend and hold harmless the NMC Defendants for any
loss, cost or expense (including attorneys' fees and other costs of defense)
arising out of any and all Grace-Related Claims, commenced or continued in this
or any other forum against any of the NMC Defendants. Such indemnification
specifically shall not apply to the costs and expenses (including lawyers' fees
and accountants' fees) incurred by the NMC Defendants in (i) defending the
Asbestos Claimant's
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Adversary Proceeding or any other proceedings or controversies arising out of or
based upon Asbestos-Related Claims prior to the Settlement Execution Date, or
(ii) defending any proceedings or controversies arising out of or based upon
Grace-Related Claims, other than Asbestos-Related claims, prior to the
Settlement Effective Date.
(G) Dismissals. Upon the filing of timely motions to dismiss by the
NMC Defendants, and the best efforts of the other Settling Parties in support of
such motions, each court with jurisdiction over the following actions shall have
dismissed by Final Order, effective upon the making of the Settlement Payment,
each of the following actions with prejudice as against the NMC Defendants:
(i) Mesquita v. W.R. Grace & Co., et al., amended as Abner v.
W.R. Grace & Co. et al., No. 315465, Superior Court of California, County
of San Francisco, (since transferred to the Court as Adversary Proceeding
No. 01-08883);
(ii) Woodward v. Sealed Air Corporation (US) et al., No.
01-10547 PBS, U.S. District Court, District of Massachusetts, (since
transferred to the Court as Case No. 01-CV-412);
(iii) Lewis v. W.R. Grace & Co. et al., U.S. Bankruptcy Court,
District of Delaware, Bkr. Case No. D. Del. 01-001139/Adv. Case No.
01-08810; and
(iv) The Asbestos Claimants Adversary Proceeding.
(H) Successors. The Final Order confirming the Plan of
Reorganization shall include a determination by the Court that, as of the Plan
Effective Date, the Estate Parties have the ability to pay and satisfy in the
ordinary course of business their respective obligations and liabilities,
including without limitation, all Indemnified Taxes and all obligations under
this Agreement.
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(I) Court Approval. The Court by Final Order shall approve this
Agreement, and each of the Estate Parties shall become obligated to, and
entitled to the benefits of, the terms and conditions of this Agreement.
(J) Implementation. Prior to the Settlement Approval Date, none of
the Estate Parties shall take any action that would be a breach of such Person's
duties under Article III of this Agreement if such action had been taken after
the Settlement Approval Date.
2.03 Payment Obligations of the NMC Defendants. Within five (5) business
days of the Settlement Effective Date the NMC Defendants shall wire transfer,
subject to the provisions of Section 3.08, one hundred fifteen million dollars
($115,000,000) cash as designated by the Court in the Final Order approving the
Plan of Reorganization.
2.04 Release of Sealed Air Defendants. Upon the Settlement Effective Date,
the NMC Defendants will execute a release, acceptable in form and substance to
the NMC Defendants, that fully, finally, and forever releases, relinquishes and
discharges Sealed Air and Cryovac from any and all Tax claims or
Asbestos-Related Claims (including but not limited to claims for lawyers' fees
and the costs of litigation related thereto) that the NMC Defendants have
asserted or could have asserted in this or any other forum against Sealed Air or
Cryovac.
2.05 Publicity. Before making any public statements or announcements prior
to the Settlement Approval Date, each of the Settling Parties shall obtain
approval from the other Settling Parties of the text of any such public
statement or announcement (including in any filing not under seal in the Court)
to be made by such party or its parents, which approval shall not be
unreasonably withheld. If the Settling Parties are not able to agree on or
approve the text of such a public statement or announcement and the legal
counsel for any party proposing to make a
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public statement or announcement is of the opinion that such public statement or
announcement is required by law or the rules of any stock exchange on which such
party's securities, or the securities of a parent corporation of such party, are
traded, then such party or the parent may make or issue the legally required
statement or announcement.
2.06 The NMC Defendants Solely Responsible for Settlement Payment.
Notwithstanding any other provision of this Agreement, or any prior Agreements,
the NMC Defendants will not seek indemnification from the Estate Parties, Sealed
Air, or Cryovac for the Settlement Payment.
2.07 Purpose of Payment and Consistency of Treatment. The Settling Parties
agree, and the Plan of Reorganization shall provide that the Estate Parties
acknowledge and agree, that FMCH and NMC have entered into this Agreement for
the purpose of settling and terminating any and all controversies relating to
the assertion of Asbestos-Related Claims, as well as other Grace-Related Claims
against the NMC Defendants. The Settlement Payment is intended and shall be
treated by the Settling Parties as a payment by the NMC Defendants of an
ordinary and necessary expense incurred by the NMC Defendants and as income of
the Estate Parties in the same amount. Any indemnification payments made by
Grace-Conn. to the NMC Defendants, to the extent the indemnified obligation
would have been an ordinary and necessary expense if incurred directly by
Grace-Conn., shall be treated by the Settling Parties as a payment by
Grace-Conn. of an ordinary and necessary expense incurred by Grace-Conn. and, to
the extent the indemnified obligation was itself deducted as an ordinary and
necessary expense of the NMC Defendants, as income of the NMC Defendants. None
of the Settling Parties shall take a position inconsistent with the foregoing in
any Tax Return or with any tax authority.
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2.08 No Limitation on Estate Parties' Ability to Propose Plan.
Notwithstanding any other provision of this Agreement, it shall not be a breach
of this Agreement for the Estate Parties to propose or support a plan of
reorganization that does not provide for the establishment of an Asbestos Trust
or the issuance of an injunction pursuant to Section 524(g) of the Bankruptcy
Code, provided however, the Estate Parties shall use their best efforts to cause
all of the preconditions set forth in Section 2.02, other than those set forth
in paragraphs (C) and (E) of Section 2.02, to occur. For the avoidance of doubt,
if the Plan of Reorganization, as well as the Final Order of confirmation
respecting the Plan of Reorganization, do not satisfy the preconditions set
forth in paragraphs (C) and (E) of Section 2.02, the NMC Defendants may in their
sole discretion waive or decline to waive, as set forth in Section 2.02, the
failure of those preconditions as conditions precedent to the Settlement
Payment.
2.09 Best Efforts By Asbestos Committees Respecting Plan. The Asbestos
Committees shall use their respective best efforts to cause the occurrence of
all the preconditions to the obligation of the NMC Defendants to make the
Settlement Payment set forth in Section 2.02, except to the extent the NMC
Defendants may in their sole discretion waive, as set forth in Section 2.02, the
failure of those preconditions as conditions precedent to the Settlement
Payment.
ARTICLE III
SPECIFIED DUTIES REGARDING TAXES.
3.01 Termination of TSIA. From the Settlement Execution Date through the
Settlement Effective Date, as among the Settling Parties, the terms of this
Agreement shall supercede the terms of the TSIA, except that Section 4.04 of the
TSIA shall remain in force and is incorporated by reference herein. Upon the
Settlement Effective Date, the TSIA shall be
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terminated and no party to such TSIA shall have any obligation to any other
party to such TSIA in respect thereof, whether such obligation shall have
accrued before or after the Settlement Approval Date, except that Section 4.04
of the TSIA shall remain in force and is incorporated by reference herein.
3.02 Estate Parties' Duty to Pay Indemnified Taxes. From and after the
Settlement Approval Date, the Estate Parties promptly shall pay any Indemnified
Taxes as such Taxes become due and payable to tax authorities pursuant to a
Final Determination, provided that the Estate Parties have obtained
authorization from the Court to pay currently any such Indemnified Taxes. To the
extent Indemnified Taxes become due and payable, the Estate Parties shall use
their best efforts to obtain authorization from the Court to pay currently such
Indemnified Taxes. The other Settling Parties shall cooperate in the Estate
Parties' efforts to obtain such authorization from the Court to pay currently
such Indemnified Taxes, provided however, that the foregoing does not modify the
obligations of members of the FMCH Group as set forth in Section 3.04(A). The
Settling Parties agree that any such payments by the Estate Parties of
Indemnified Taxes are, for purposes of this Agreement and the administration of
the Debtors' estates, the payment of the Taxes of the Estate Parties.
3.03 Grace-Conn. Control of Indemnified Tax Matters.
(A) Grace-Conn. Authority over Indemnified Taxes. Upon the
Settlement Approval Date, subject to the limitations in Sections 3.03(B) and
(C), Grace-Conn. solely shall be authorized to act for the Grace New York Group
in its sole discretion with respect to Indemnified Taxes. Notwithstanding the
authority granted in the previous sentence, Grace-Conn. and the other Estate
Parties shall use their respective best efforts to defer any Final Determination
of any Indemnified Taxes until such time as the Estate Parties have obtained
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authorization from the Court to pay currently such Indemnified Taxes, and the
other Settling Parties shall cooperate in the effort to defer any Final
Determination of any Indemnified Taxes prior to authorization from the Court to
pay such Indemnified Taxes, provided however, that the foregoing does not modify
the obligations of members of the FMCH Group as set forth in Section 3.04(A).
FMCH will provide to Grace-Conn. and its agents from time to time Powers of
Attorney with respect to Indemnified Taxes so that Grace-Conn. can act as the
agent of the Grace New York Group with respect to Indemnified Taxes. The NMC
Defendants agree that, pursuant to the cooperation obligations set forth in
Section 3.04(A), they will respect such authority of Grace-Conn. and do nothing
to derogate from such authority with respect to Indemnified Taxes, and, so long
as none of the Estate Parties are in breach of this Agreement, the NMC
Defendants will not initiate communications with any tax authority concerning
Indemnified Taxes without obtaining the written consent of Grace-Conn. or the
permission of the Court. As requested by Grace-Conn., amendments to Consolidated
Tax Returns for or attributable to all Tax Periods of the Grace New York Group
ending on or before December 31, 1996 shall be prepared by Grace-Conn. and filed
by FMCH on behalf of Grace-Conn.
(B) Limitations on Agreement To Final Determinations. Neither
Grace-Conn. nor any other Estate Party shall voluntarily agree to the payment,
assessment, resolution or other Final Determination of any Indemnified Tax prior
to the Settlement Effective Date, except to the extent the Estate Parties have
obtained authorization from the Court to pay promptly in full any such
Indemnified Taxes, or to the extent FMCH hereafter has consented in its sole
discretion in writing to the Estate Parties' agreement to such payment,
assessment, resolution or other Final Determination.
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(C) Tax Refunds. Grace-Conn. shall control any Tax Refund of the
Grace New York Group with respect to any Tax Period ending on or before December
31, 1996, credited or payable to any member of the Grace New York Group, except
that:
(i) any such Tax Refund credited or paid to any member of the Grace
New York Group prior to the time the Estate Parties have received authority from
the Court to make payments under Section 3.02 above of Indemnified Taxes as they
become due and payable shall be repaid to the tax authority as a payment of
Indemnified Taxes (whether or not then due and payable) if, in the reasonable
determination of FMCH, Indemnified Taxes are expected to become due and payable
to such tax authority, provided however, if there is a dispute as to whether
additional Indemnified Taxes are expected to become due and payable to such tax
authority Grace-Conn. shall first have the opportunity to seek a determination
from the Court that additional Indemnified Taxes are not expected to become due
and payable to such tax authority and Grace-Conn. therefore should be permitted
by the Court to receive and retain such refund; and
(ii) any Tax Refund attributable to the NMC Business with respect to
any Tax Period ending on or before December 31, 1996, (I) shall first be applied
to satisfaction of NMC Indemnified Taxes and (II) thereafter shall be applied to
the satisfaction of Indemnified Taxes or if there are no such NMC Indemnified
Taxes or Indemnified Taxes then due and payable, or in the reasonable
determination of Grace-Conn. expected to become due and payable within eighteen
(18) months, promptly shall be paid to FMCH. None of the Estate Parties shall
seek the refund of any previously paid Taxes of the Grace New York Group with
respect to any Tax Period ending on or before December 31, 1996, if in the
reasonable determination of either FMCH or Grace-Conn. Indemnified Taxes are
expected to become due and payable to such tax authority for Tax Periods ending
on or before December 31, 1996.
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3.04 Cooperation.
(A) Cooperation by FMCH. From and after the Settlement Approval
Date, FMCH from time to time shall provide such cooperation as Grace-Conn. shall
reasonably request, including (i) the implementation of its rights and
responsibilities under this Agreement with respect to Indemnified Taxes, and
(ii) provide such Powers of Attorney as provided in Section 3.03(A), and FMCH
will not seek indemnification for the costs and expenses (including lawyers'
fees and accountants' fees) of such cooperation, provided that FMCH will not be
required to incur any unreasonable cost or expense in respect of such
cooperation. Whenever FMCH or other member of the FMCH Group receives notice or
demand from any tax authority with respect to any Tax Item which could increase
or decrease the liability for, or give rise to a Tax Refund with respect to, any
Indemnified Tax, FMCH shall in good faith promptly give notice to Grace-Conn. of
such Indemnified Tax related issue, in accordance with Section 5.07.
(B) Cooperation by Estate Parties. Upon the request of FMCH, each of
the Estate Parties from time to time shall provide such cooperation as FMCH
shall reasonably request, including (i) the implementation of its rights and
responsibilities under this Agreement with respect to NMC Indemnified Taxes and
(ii) provide such Powers of Attorney relating to NMC Indemnified Taxes as FMCH
shall request with respect to Tax Periods ending on or before December 31, 1996,
and the Estate Parties will not seek indemnification for the costs and expenses
(including lawyers' fees and accountants' fees) of such cooperation, provided
that the Estate Parties will not be required to incur any unreasonable cost or
expense in respect of such cooperation. Whenever any of the Estate Parties
receives notice or demand from any tax authority with respect to any Tax Item
which could increase or decrease the liability for, or give rise to a Tax Refund
with respect to, any NMC Indemnified Tax, Grace-Conn. shall in good faith
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promptly give notice to FMCH of such NMC Indemnified Tax related issue, in
accordance with Section 5.07. Grace-Conn. shall provide prompt notice from time
to time to FMCH of (i) revenue agents' reports, adjustments to Tax Items that
may increase Indemnified Taxes, demands for payment of Indemnified Taxes,
notices of proposed assessments and Final Determinations respecting Indemnified
Taxes and similar correspondence, notices and demands from tax authorities and
(ii) confirmation that Indemnified Taxes have been paid by the Estate Parties.
3.05 FMCH Group Protection for Indemnified Taxes. The Estate Parties
jointly and severally shall indemnify, defend and hold harmless FMCH and each
member of the FMCH Group from and against any loss in respect of (i) Indemnified
Taxes or (ii) any action by any Person, including any tax authority, seeking
payment by or reimbursement from FMCH or any of the other NMC Defendants for any
Indemnified Taxes, provided however, that there shall be no duty to indemnify
for costs and expenses (including lawyers' fees and accountants' fees) except in
the event of a breach of this Agreement and pursuant to the terms of Section
3.09 below.
3.06 Estate Parties' Protection for NMC Indemnified Taxes. FMCH and the
other members of the FMCH Group jointly and severally shall indemnify, defend
and hold harmless each of the Estate Parties from and against any loss in
respect of (i) NMC Indemnified Taxes or (ii) any action by any Person, including
any tax authority, seeking payment by or reimbursement from any of the Estate
Parties for any NMC Indemnified Taxes, provided however, that there shall be no
duty to indemnify for costs and expenses (including lawyers' fees and
accountants' fees) except in the event of a breach of this Agreement and
pursuant to the terms of Section 3.09 below.
3.07 Payment of Indemnified Taxes by FMCH. Notwithstanding the obligations
of the Estate Parties in Section 3.02, in the event that any tax authority shall
demand of FMCH or any
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other members of the FMCH Group payment of any Indemnified Taxes, and FMCH or
such other members of the FMCH Group pays such Indemnified Taxes, each of the
Estate Parties promptly and unconditionally shall be obligated jointly and
severally to and shall repay such amount of the Indemnified Taxes to FMCH or the
other members of the FMCH Group, as applicable, with interest from the date of
payment at the Hot Interest Rate. To the extent such Indemnified Taxes and
interest are not set off against the payment required by Section 2.03 or any
other payment required of FMCH or any member of the FMCH Group under this
Agreement or otherwise pursuant to Section 3.08 below, FMCH or the other members
of the FMCH Group, as applicable, shall have an allowed claim to the extent of
such payment, including interest thereon at the Hot Interest Rate, against the
estates of the Debtors. On and after the Settlement Effective Date, in addition
to any other rights and remedies under this Agreement, each such claim for
Indemnified Taxes and interest shall be an Allowed Administrative Claim against
the Estate Parties.
3.08 Right of Setoff. Notwithstanding anything herein to the contrary,
FMCH and each member of the FMCH Group shall have a right of setoff or
recoupment, including a right of setoff under Section 553 of the Bankruptcy
Code, against the payment required by Section 2.03 or any other payment required
of FMCH or any member of the FMCH Group under this Agreement or otherwise, for
the amount of any obligation of any of the Estate Parties under this Agreement,
including without limitation indemnification obligations for Indemnified Taxes,
that any of the Estate Parties has failed to pay to FMCH or the members of the
FMCH Group.
3.09 Remedies for Breach. In the event of any breach of this Agreement,
including any obligation for indemnification, (i) by the Estate Parties or any
member of the New Grace Group, then the Estate Parties shall be jointly and
severally liable for and shall indemnify, defend
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and hold harmless the NMC Defendants from and against any Taxes, loss, cost or
expense (including without limitation reasonable lawyers' fees and reasonable
accountants' fees) attributable to such breach, and the NMC Defendants shall
have, among other remedies, an allowed Administrative Claim against each of the
Estate Parties for any Taxes, loss, cost or expense (including without
limitation reasonable lawyers' fees and reasonable accountants' fees)
attributable to such breach; or (ii) by the NMC Defendants or any member of the
FMCH Group, then the NMC Defendants shall be jointly and severally liable for
and shall indemnify, defend and hold harmless the Estate Parties from and
against any Taxes, loss, cost or expense (including without limitation
reasonable lawyers' fees and reasonable accountants' fees) attributable to such
breach.
3.10 Preservation of Rights. In the event that a member of the New Grace
Group, or their respective successors or assigns, shall fail to perform any
obligation to indemnify, defend and hold harmless FMCH or any member of the FMCH
Group, as provided in this Agreement, or prior to its termination, the TSIA,
nothing herein shall preclude or estop such member of the FMCH Group from
asserting any causes of action on the grounds that one or more of the members of
the New Grace Group or of the Sealed Air/Grace Group is primarily liable for
such obligation under general principles of law determined without reference to
this Agreement or the TSIA.
ARTICLE IV
COVENANTS NOT TO SUE AND TOLLING.
4.01 Claims Against the NMC Defendants. The Asbestos Committees and the
Estate Parties shall not commence or prosecute, or cooperate in the commencement
or prosecution of, any suit, demand, claim, or cause of action, whether asserted
directly or derivatively, against any
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of the NMC Defendants for any Grace-Related Claims, including the Asbestos
Claimants' Adversary Proceeding, except (i) as permitted in Section 4.03 below
or (ii) to enforce this Agreement.
4.02 Sealed Air Indemnity Litigation. In connection with the Sealed Air
Settlement Agreement, the Asbestos Committees shall use their best efforts to
obtain from Sealed Air and Cryovac, an agreement acceptable in form and
substance to the NMC Defendants, which provides for the stay, and if necessary
the reinstatement, of the Sealed Air Indemnity Litigation pending the Settlement
Effective Date. If Sealed Air and Cryovac do not agree to a stay of the Sealed
Air Indemnity Litigation, then notwithstanding any other provision of this
Agreement, prior to the Settlement Effective Date the NMC Defendants shall
remain free to pursue all rights and remedies they may have against Sealed Air
and Cryovac, in any court of competent jurisdiction.
4.03 Reinstatement of Litigation Upon Failure of Conditions Precedent. The
Asbestos Committees or the Estate Parties may reinstate the Asbestos Claimants
Adversary Proceeding on the active docket if the Court determines by Final Order
(the "Litigation Reinstatement Date") that despite the best efforts of the
Estate Parties and the Asbestos Committees one or more conditions in Section
2.02 above will not be able to be satisfied, and the failure of such
precondition has not been waived by the NMC Defendants. For purposes of statutes
of limitation, statutes of repose, and any procedural bars to the prosecutions
of claims, all claims, counterclaims, cross-claims, and claims for contribution
or indemnity the Settling Parties have asserted or could have asserted in the
Court or any other forum will be deemed to have been tolled during the time
period between the Settlement Execution Date and the Litigation Reinstatement
Date.
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ARTICLE V
MISCELLANEOUS PROVISIONS.
5.01 Expenses. Unless otherwise expressly provided in this Agreement, each
Person shall bear any and all expenses (including legal and accounting) that
arise from its respective obligations under this Agreement.
5.02 Amendment; Agency. This Agreement may not be amended except by an
agreement in writing, signed by the Settling Parties with the approval of the
Court. The Settling Parties agree that FMCH shall be entitled to receive notices
and to act on behalf of each member of the FMCH Group and each of the NMC
Defendants and that Grace-Conn. shall be entitled to receive notices and to act
on behalf of New Grace, the other Estate Parties and the New Grace Group, and
each member of the New Grace Group, in respect of all matters under this
Agreement.
5.03 Settlement Inadmissible for Other Purposes. The Settling Parties
agree that the terms of this Agreement reflect a good faith settlement of the
Grace-Related Claims and of the other terms and conditions contained herein,
reached voluntarily after consultation with experienced legal counsel. Neither
this Agreement nor the settlements contained herein, nor any act performed,
document executed, or statement made pursuant to or in support of or in
furtherance of this Agreement or the settlements contained herein: (i) is or may
be deemed to be or may be used as an admission of, or evidence of, the validity
or amount of any Grace-Related Claim or any other claim, or of any wrongdoing or
liability; or (ii) is or may be deemed to be or may be used as an admission of,
or evidence of, any fault or omission of any Settling Party in any proceeding in
any court, administrative agency, or other tribunal. Any Settling Party or other
Person released by the terms or
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implementation of this Agreement may file this Agreement in any other action
that may be brought against them in order to support a defense or counterclaim
based on principles of res judicata, collateral estoppel, release, good faith
settlement, accord and satisfaction, bar order, channelling injunction, judgment
bar or reduction, or any theory of claim preclusion or issue preclusion or
similar defense or counterclaim. The Settling Parties may file this Agreement in
any proceeding brought to enforce any of its terms.
5.04 Signed Counterparts. This Agreement may be executed in one or more
counterparts. All executed counterparts and each of them shall be deemed to be
one and the same instrument. Counsel for the Settling Parties shall exchange
among themselves signed counterparts of this Agreement. 5.05 Confidentiality of
Information. All agreements made between and among the Settling Parties and
orders entered during the course of the Asbestos Claimants Adversary Proceeding
relating to the confidentiality of information shall survive this Agreement.
5.06 Agreement Drafted Equally. This Agreement shall not be construed more
strictly against one party than another merely because it, or any part of it,
may have been prepared by counsel for one of the parties. The Settling Parties
acknowledge and agree that the Agreement is the result of arm's-length
negotiations between the parties and all parties have contributed substantially
and materially to the preparation of this Agreement.
5.07 Notices. All notices and other communications hereunder shall be in
writing and shall be delivered by hand including overnight business courier or
mailed by registered or certified mail (return receipt requested) to the parties
at the following addresses (or at such other addresses for a party as shall be
specified by like notice) and shall be deemed given on the date on which such
notice is received:
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To Grace-Conn. or any member of the New Grace Group:
W.R. Grace & Co.
7500 Grace Drive
Columbia, Maryland 21044
Attention: Secretary
Phone: (410) 531-4212
Fax: (410) 531-4783
With a copy to:
David M. Bernick
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Phone: (312) 861-2000
Fax (312) 861-2200
Email: david_bernick@chicago.kirkland.com
To the Official Committee of Asbestos Personal Injury Claimants :
Peter Van N. Lockwood
Caplin & Drysdale, Chartered
1 Thomas Circle N.W.
Washington, D.C. 20005
Phone: (202) 862-5000
Fax (202) 429-3301
Email: pvnl@capdale.com
To the Official Committee of Asbestos Property Damage Claimants:
Scott L. Baena
Bilzin Sumberg Baena Price & Axelrod LLP
200 South Biscayne Blvd., Suite 2500
Miami, Florida 33131
Phone: (305) 374-7580
Fax: (305) 374-7593
Email: sbaena@bilzin.com
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To FMCH or any member of the FMCH Group:
c/o Fresenius Medical Care North America
Corporate Headquarters
General Counsel
Corporate Law Department
95 Hayden Avenue
Lexington, MA 02420-9192
Phone: (781) 402-9000
Fax: (781) 402-9713
With a copy to:
David S. Rosenbloom
McDermott, Will & Emery
227 W. Monroe, Suite 4400
Chicago, Illinois 60606
Phone: (312) 372-2000
Fax: (312) 984-7700
Email: drosenbloom@mwe.com
5.08 Resolution of Disputes. Any claim or dispute arising out of or
relating in any way to this Agreement must be brought before the Court, which
shall retain jurisdiction of this matter and the Settling Parties for the
purposes of enforcing and implementing the terms and conditions of this
Agreement and resolving disputes as to the rights and obligations of the
Settling Parties hereunder, provided however that section 524(g)(2) shall govern
jurisdiction over any proceeding that involves any injunction entered in
accordance with section 524(g) of the Bankruptcy Code. The Settling Parties
submit to the jurisdiction of the Court for these purposes.
5.09 Titles and Headings. Titles and headings to sections herein are
inserted for the convenience of reference only and are not intended to be a part
or to affect the meaning or interpretation of this Agreement.
5.10 Legal Enforceability. Without prejudice to any rights or remedies
otherwise available to any party hereto, each party hereto acknowledges that
damages would be an
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inadequate remedy for any breach of the provisions of this Agreement and agrees
that the obligations of the Settling Parties hereunder shall be specifically
enforceable.
5.11 Governing Law. This Agreement shall be governed by the laws of the
State of Delaware (without giving effect to its provisions on conflict of laws),
and without affecting any determination as to the law applicable to the Asbestos
Claimants' Adversary Proceeding.
5.12 Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of the successors and assigns of the Settling
Parties, including without limitation the other Estate Parties; provided that
(i) neither this Agreement nor any substantial right or obligation hereunder may
be assigned by FMCH, on the one hand, and New Grace or Grace-Conn., on the
other, without the consent of the other Settling Parties, which consent shall
not be unreasonably withheld, and (ii) none of the Estate Parties shall transfer
or agree to transfer a substantial part of their respective assets (in one or a
series of transactions, whether or not related) to any Person or Persons,
without a prior determination of the Court by Final Order that at the time of
each such transaction New Grace and Grace-Conn., or any such successors who
agree to be jointly and severally liable for the obligations of New Grace and
Grace-Conn., will have the ability to pay and satisfy in the ordinary course of
business their respective obligations and liabilities, including without
limitation, all Indemnified Taxes and all obligations under this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written, on their own behalf and as authorized agents for
each member of their respective affiliated groups.
THE OFFICIAL COMMITTEE OF ASBESTOS
PERSONAL INJURY CLAIMANTS
By: /s/Peter Van N. Lockwood
-----------------------------------
Name
Counsel
-----------------------------------
Title
THE OFFICIAL COMMITTEE OF ASBESTOS
PROPERTY DAMAGE CLAIMANTS
By: /s/Scott L. Baena
-----------------------------------
Name
Counsel
-----------------------------------
Title
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FRESENIUS MEDICAL CARE HOLDINGS, INC.
By: /s/ Ronald J. Kuerbitz
---------------------------------
Name
Senior Vice President
---------------------------------
Title
NATIONAL MEDICAL CARE, INC.
By: /s/ Ronald J. Kuerbitz
---------------------------------
Name
Senior Vice President
---------------------------------
Title
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APPENDIX A
TO SETTLEMENT AGREEMENT AND RELEASE OF CLAIMS
DEFINITIONS
As used in the Settlement Agreement and Release of Claims, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and the plural forms of the terms defined):
1.01 "Administrative Claim" shall mean a claim (as defined in Section
101(5) of the Bankruptcy Code) against the Debtors' chapter 11 bankruptcy
estates for costs and expenses of administration under Sections 503(a) or
507(a)(1) of the Bankruptcy Code.
1.02 "Asbestos Claimants Adversary Proceeding" shall mean the
adversary proceeding captioned, Official Committee of Asbestos Personal
Injury Claimants and Official Committee of Asbestos Property Damage Claimants
of W.R. Grace & Co., suing in behalf of the Chapter 11 Bankruptcy Estates of
W.R. Grace & Co., et al., Plaintiffs v. Fresenius Medical Care Holdings, Inc.
and National Medical Care, Inc., Adversary Proceeding No. 02-2211, which the
Court consolidated with Adversary Proceeding No. 02-2210, by Order dated
March 28, 2002.
1.03 "Asbestos-Related Claim" shall mean any claim, (including but not
limited to personal injury, wrongful death, property damage or medical
monitoring) whether sounding in tort, contract, warranty, statute, or any other
theory of law or equity, based on or arising by reason of direct or indirect
damages allegedly caused by consumption, use, storage, manufacturing, assembly,
distribution, installation, exposure to, or the presence of asbestos or asbestos
containing products or by-products, or products which contain asbestos in any
form, consumed, used, stored, manufactured, assembled, distributed, disposed of,
or installed by or on behalf of any Grace-Conn. Business.
1.04 "Asbestos Trust" shall have the meaning ascribed to such term in
Section 2.02(C).
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1.05 "Bankruptcy Code" shall mean title 11 of the United States Code, as
amended.
1.06 "Code" shall mean the Internal Revenue Code of 1986, as amended, and
shall include corresponding provisions of any subsequently enacted federal
income tax laws.
1.07 "Common Parent" shall mean the common parent, as defined in Treasury
Regulation Section 1.1502-77, of those corporations that joined, or hereafter
join, in filing a Consolidated Tax Return under Section 1501 of the Code, and
the Treasury Regulations thereunder, or a Consolidated Tax Return under
comparable provisions of Tax law of other jurisdictions (domestic or foreign).
1.08 "Consolidated Tax Return" shall mean (i) a federal consolidated
income Tax Return, within the meaning of Section 1501 of the Code and the
Treasury Regulations under Section 1502 of the Code, and (ii) any combined,
joint, consolidated or other Tax Return respecting Taxes under the laws of any
jurisdiction (domestic or foreign).
1.09 "Court" shall mean the court in which the Asbestos Claimants'
Adversary Proceeding is pending, or if no longer pending, the United States
Bankruptcy Court for the District of Delaware.
1.10 "Cryovac" shall mean Cryovac, Inc. (f/k/a Grace Communications,
Inc.) (taxpayer identification number 13-2830262).
1.11 "Debtor" shall mean each of W. R. Grace & Co. (f/k/a Grace
Specialty Chemicals, Inc.), W. R. Grace & Co. Conn., A-1 Bit & Tool Co.,
Inc., Alewife Boston Ltd., Alewife Land Corporation, Amicon, Inc., CB
Biomedical, Inc. (f/k/a Circe Biomedical, Inc.), CCHP, Inc., Coalgrace, Inc.,
Coalgrace II, Inc., Creative Food 'N Fun Company, Darex Puerto Rico, Inc.,
Del Taco Restaurants, Inc., Dewey and Almy, LLC (f/k/a Dewey and Almy
Company), Ecarg, Inc., Five Alewife Boston Ltd., GC Limited Partners I, Inc.,
(f/k/a Grace Cocoa Limited Partners I,
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Inc.), GC Management, Inc. (f/k/a Grace Cocoa Management, Inc.), GEC Management
Corporation, GN Holdings, Inc. GPC Thomasville Corp., Gloucester New Communities
Company, Inc., Grace A-B Inc., Grace A-B II Inc., Grace Chemical Company of
Cuba, Grace Culinary Systems, Inc., Grace Drilling Company, Grace Energy
Corporation, Grace Environmental, Inc., Grace Europe, Inc., Grace H-G Inc.,
Grace H-G II Inc., Grace Hotel Services Corporation, Grace International
Holdings, Inc. (f/k/a Dearborn International Holdings, Inc.), Grace Offshore
Company, Grace PAR Corporation, Grace Petroleum Libya Incorporated, Grace Tarpon
Investors, Inc., Grace Ventures Corp., Grace Washington, Inc., W. R. Grace
Capital Corporation., W. R. Grace Land Corporation, Gracoal, Inc., Gracoal II,
Inc., Guanica-Caribe Land Development Corporation, Hanover Square Corporation,
Homco International, Inc., Kootenai Development Company, L B Realty, Inc.,
Litigation Management, Inc. (f/k/a GHSC Holding, Inc., Grace JVH, Inc., Asbestos
Management, Inc.), Monolith Enterprises, Incorporated, Monroe Street, Inc., MRA
Holdings Corp. (f/k/a Nestor-BNA Holdings Corporation), MRA Intermedco, Inc.
(f/k/a Nestor-BNA, Inc.), MRA Staffing Systems, Inc. (f/k/a British Nursing
Association, Inc.), Remedium Group, Inc. (f/k/a Environmental Liability
Management, Inc., E&C Liquidating Corp., Emerson & Cuming, Inc.), Southern Oil,
Resin & Fiberglass, Inc., Water Street Corporation, Axial Basin Ranch Company,
CC Partners (f/k/a Cross Country Staffing), Hayden-Gulch West Coal Company, H-G
Coal Company.
1.12 "Estate Parties" shall mean each of the Debtors, the estate of each
Debtor, the post-confirmation estate of each Debtor, each of the reorganized
Debtors, and any trustee that may be appointed in any of the Debtors' cases
under the Bankruptcy Code.
1.13 "Final Determination" shall mean any assessment or resolution of
liability for any Tax for a Tax Period, (i) by Form 870 or 870-AD or by Form
5701 (or any successor forms
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thereto), on the date of acceptance or agreement by or on behalf of the
taxpayer, or by comparable forms respecting Taxes under the laws of other
jurisdictions (domestic or foreign); (ii) by a decision, judgment, decree, or
other order by a court of competent jurisdiction, which has become final and
unappealable; (iii) by a closing agreement or accepted offer in compromise under
Section 7121 or 7122 of the Code, or comparable agreements respecting Taxes
under the laws of other jurisdictions (domestic or foreign); (iv) by any
allowance of a refund or credit in respect of an overpayment of Tax, but only
after the expiration of all periods during which such refund may be recovered
(including by way of offset) by the Tax imposing jurisdiction (domestic or
foreign); or (v) by any other final disposition, including by reason of Section
6213(b)(3) of the Code on account of an excessive tentative carryback allowance
under Section 6411 of the Code or comparable provisions of other jurisdictions
(domestic or foreign), the expiration of the applicable statute of limitations,
or by mutual agreement of the parties.
1.14 "Final Order" shall mean an order or judgment of the Court , or other
court of competent jurisdiction with respect to the subject matter, which has
not been reversed, stayed, modified or amended, and as to which the time to
appeal or seek certiorari has expired and no appeal or petition for certiorari
has been timely taken, or as to which any appeal that has been taken or any
petition for certiorari that has been or may be filed has been resolved by the
highest court to which the order or judgment was appealed or from which
certiorari was sought.
1.15 "FMCH Group" shall mean that group of corporations, immediately after
December 31, 1996, that were members of the affiliated group of corporations of
which FMCH (taxpayer identification number 13-3461988) was and on the date
hereof continues to be the Common Parent.
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1.16 "Form 1139" shall mean a Corporate Application for Tentative Refund
on Internal Revenue Service Form 1139, or any successors to such form, or
comparable forms for Taxes of any other jurisdiction (domestic or foreign).
1.17 "Grace-Conn." shall mean W.R. Grace & Co. -- Conn. (taxpayer
identification number 13-5114230).
1.18 "Grace-Conn. Business" shall mean all of the businesses and
operations of Grace-Conn. and its parents or subsidiaries at any time, other
than the NMC Business.
1.19 "Grace New York" shall mean W.R. Grace & Co., a New York
corporation, now known as FMCH, (taxpayer identification number 13-3461988).
1.20 "Grace New York Group" shall mean that group of corporations,
including Grace-Conn., Cryovac, and Sealed Air, that were members through
September 29, 1996 or December 31, 1996, as applicable, of the affiliated group
of corporations within the meaning of Section 1504 of the Code, and the Treasury
Regulations thereunder, of which Grace New York was the Common Parent,
including, with respect to Taxes of other jurisdictions (domestic or foreign),
that group of corporations which included Grace New York or one or more of the
members of the Grace New York Group with respect to a Consolidated Tax Return.
1.21 "Grace-Related Claim" shall mean, collectively, all claims (including
unknown claims), demands, rights, liabilities and causes of action of every
nature and description whatsoever, known or unknown, direct or indirect, whether
concealed or hidden, from the beginning of time up to and including the
Settlement Effective Date, asserted or that might have been asserted (including
without limitation claims for fraudulent conveyance, successor liability,
piercing of corporate veil, negligence, gross negligence, professional
negligence, breach of duty of care, breach of duty of loyalty, breach of duty of
candor, fraud, breach of fiduciary duty,
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mismanagement, corporate waste, breach of contract, negligent misrepresentation,
contribution, indemnification, any other common law or equitable claims, and
violations of any state or federal statutes, rules or regulations), which are
either Asbestos-Related Claims or that are based upon or arise out of the NMC
Transaction, or the conduct or operations of any Grace-Conn. Business, including
without limitation, any liability or obligation of a Grace-Conn. Business under
environmental law, but not including any claims based on or arising out of the
conduct or operations of the NMC Business or any act or omission of the NMC
Defendants in connection with the operation of the NMC Business.
1.22 "Hot Interest Rate" shall mean the rate of interest charged from time
to time on Taxes under Section 6621(c)(1) of the Code.
1.23 "Indemnified Taxes" shall mean all Taxes for or attributable to Tax
Periods ending on or before December 31, 1996, other than NMC Indemnified Taxes.
1.24 "Litigation Reinstatement Date" shall have the meaning ascribed to
such term in Section 4.03.
1.25 "Moving Parties" shall mean each of FMCH, NMC, the PI Committee, and
the PD Committee.
1.26 "New Grace" shall mean W.R. Grace & Co., f/k/a Grace Specialty
Chemicals, Inc. (taxpayer identification number 65-0773649).
1.27 "New Grace Group" shall mean that group of corporations, including
Grace-Conn., that were, or hereafter become, members of that affiliated group of
corporations under Section 1504 of the Code, and the Treasury Regulations
thereunder, that joined, or hereafter join, in filing a Consolidated Tax Return
of which New Grace, or any successor to New Grace, including any reorganized
Debtor successor to New Grace, was or is the Common Parent.
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1.28 "NMC Business" shall mean all of the worldwide healthcare business
and operations conducted by NMC and the NMC Subsidiaries at any time, whether
prior to or after September 29, 1996.
1.29 "NMC Defendants" shall mean FMCH, NMC, and each of their respective
present and former subsidiaries, parents, affiliates, officers, directors,
employees, partners, trustees, shareholders, beneficiaries, agents, attorneys,
predecessors, successors, and assigns, including but not limited to Fresenius
Medical Care AG and Fresenius AG, but not including the Estate Parties, Sealed
Air and Cryovac.
1.30 "NMC Group" shall mean NMC and the NMC Subsidiaries, whether members
of the Grace New York Group or members of the FMCH Group.
1.31 "NMC Indemnified Taxes" shall mean all Taxes of or attributable to
any Tax Period arising from Tax Items relating to the NMC Business conducted by
a member of the FMCH Group (net of benefits from Tax Items relating to the NMC
Business from one or more Tax Periods not previously paid to, or applied for the
benefit of, any member of the FMCH Group) which have not previously been paid to
(i) one of the Estate Parties, (ii) Grace New York prior to the NMC Transaction
or (iii) the applicable tax authority, by any member of the FMCH Group.
1.32 "NMC Subsidiaries" shall mean all direct and indirect subsidiaries of
NMC through which Grace New York or FMCH conducts or conducted the NMC Business.
1.33 "NMC Transaction" shall mean the series of transactions that became
effective on September 27 - 30, 1996, whereby, inter alia, (i) NMC distributed
approximately $2.3 billion in cash and assumed debt to Grace-Conn; (ii)
Grace-Conn. distributed 100% of the common shares of NMC stock to Grace-New
York; (iii) Grace New York contributed 100% of the common shares of Grace-Conn.
stock to Sealed Air; (iv) Grace New York distributed 100% of the common
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shares of Sealed Air stock to its shareholders; and (v) Grace New York merged
with a subsidiary of Fresenius Medical Care AG, all of which are more fully
described in that certain Distribution Agreement dated as of February 4, 1996,
among Grace New York, Grace-Conn. and Fresenius AG, and that certain
Contribution Agreement dated as of February 4, 1996, among Fresenius AG,
Sterilpharma GmbH, and Grace-Conn.
1.34 "Person" shall mean a natural person, individual, corporation,
partnership, limited partnership, limited liability partnership, limited
liability company, association, joint venture, joint stock company, estate,
legal representative, trust, unincorporated association, government or any
political subdivision or agency thereof, and any business or legal entity and
their spouses, heirs, executors, administrators, predecessors, successors,
representatives, or assigns.
1.35 "Plan Effective Date" shall mean the date specified as such in the
Plan of Reorganization.
1.36 "Plan of Reorganization" shall mean the plan of reorganization of the
Debtors under the Bankruptcy Code approved by a Final Order of confirmation of
the Court.
1.37 "Power of Attorney" shall mean any agency under a power of attorney
or other authorization which authorizes a Person to act on behalf of another
Person with respect to Taxes, including Form 2848.
1.38 "Sealed Air" shall mean Sealed Air Corporation, f/k/a Grace Holding,
Inc. (taxpayer identification number 65-0654331).
1.39 "Sealed Air/Grace Group" shall mean the group of corporations,
including but not limited to Cryovac, Inc., that were from on or about September
29, 1996, or hereafter become, members of the affiliated group of corporations
under Section 1504 of the Code, and the
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Treasury Regulations thereunder, that joined, or hereafter join, in filing a
Consolidated Tax Return of which Sealed Air Corporation, or any successor to
Sealed Air, was or is the Common Parent.
1.40 "Sealed Air Indemnity Litigation" shall mean the litigation
captioned Sealed Air Corporation vs. Fresenius Medical Care AG, Fresenius
Medical Care Holdings, Inc.; National Medical Care, Inc.; and Fresenius USA,
Inc., (No. 600300/02 N.Y. Sup. Ct.).
1.41 "Sealed Air Settlement Agreement" shall mean the definitive
agreement implementing the settlement of the adversary proceeding captioned,
Official Committee of Asbestos Personal Injury Claimants and Official
Committee of Asbestos Property Damage Claimants of W.R. Grace & Co., suing in
behalf of the Chapter 11 Bankruptcy Estates of W.R. Grace & Co., et al.,
Plaintiffs v. Sealed Air Corporation. and Cryovac, Inc., Adversary Proceeding
No. 02-2210, which settlement is reflected in the Acknowledgement of
principal terms filed with the Court on November 27, 2002.
1.42 "Settlement Approval Date" shall mean the date the Court enters the
orders described in Section 2.01.
1.43 "Settlement Effective Date" shall mean the later of: (i) the Plan
Effective Date, or (ii) the satisfaction of all preconditions to payment
described in Section 2.02, to the extent each such precondition has not been
waived by the NMC Defendants.
1.44 "Settlement Execution Date" shall mean February 6, 2003.
1.45 "Settling Parties" shall mean (i) each of FMCH, NMC, the PI
Committee, and the PD Committee, and (ii) either upon the satisfaction of the
precondition in Section 2.02(I) or upon the execution of this Agreement by New
Grace and Grace-Conn, New Grace and Grace-Conn., and (iii) the respective
members of the affiliated groups of each of the other Settling Parties.
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1.46 "Settlement Payment" shall mean the payment by the NMC Defendants
provided for in Section 2.03, as reduced by the items of setoff or recoupment,
if any, referred to in Section 3.08.
1.47 "Taxes" shall mean all forms of taxation, whenever created or
imposed, and whether of the United States or elsewhere, and whether imposed by a
local, municipal, governmental, state, foreign, federation or other body, and
without limiting the generality of the foregoing, shall include income
(including alternative minimum), sales, use, ad valorem, gross receipts,
license, value added, franchise, transfer, recording, withholding, payroll,
employment, excise, occupation, unemployment insurance, social security,
business license, business organization, stamp, environmental, premium and
property taxes, together with any related interest, penalties and additions to
any such tax, or additional amounts imposed by any taxing authority (domestic or
foreign) upon the FMCH Group, the New Grace Group, the Grace New York Group, the
Sealed Air Group or any of their respective members or divisions or branches.
1.48 "Tax Item" shall mean any item of income, gain, loss, deduction,
credit, provisions for reserves, recapture of credit, net operating loss, net
capital loss, tax credit, sales, revenues, property or asset values, capital or
any other item which increases or decreases Taxes paid or payable, including an
adjustment under Code Section 481 (or comparable provisions of the Tax law of
any other jurisdiction (domestic or foreign)) resulting from a change in
accounting method, the allowance or disallowance in whole or in part of, or
assessment with respect to, a tentative allowance of refund claimed on Form
1139, the allowance or disallowance in whole or in part of a net operating loss,
net capital loss or tax credit claimed on a Tax Return, an amended Tax Return or
claim for refund, or an adjustment attributable to a quick refund of overpayment
of estimated tax.
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1.49 "Tax Period" shall mean any period for, or with respect to, which a
Tax Return is or has been filed, is required to be filed or may be filed.
1.50 "Tax Refund" shall mean an overpayment of, refund of, or credit
against, Taxes, including a tentative allowance of refund claimed on Form 1139.
1.51 "Tax Return" shall mean any return, filing, questionnaire,
information return or other document required or permitted to be filed,
including requests for extensions of time, filings made with estimated tax
payments, claims for refund, Forms 1139 and amended returns, that has been, or
hereafter may, be filed for any Tax Period with any tax authority (whether
domestic or foreign) in connection with any Tax (whether or not a payment is
required to be made, or an overpayment, refund, or credit may be allowed, with
respect to such filing).
1.52 "TSIA" shall mean that certain Tax Sharing and Indemnification
Agreement made as of September 27, 1996, by and among Grace New York,
Grace-Conn., and Fresenius AG, an Aktiengesellshaft organized under the laws of
the Federal Republic of Germany and an indirect parent of FMCH.
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