GOLDMAN SACHS BANK USA 200 West Street New York, New York10282-2198

GOLDMAN SACHS BANK USA 200 West Street New York, New York   10282-2198

UBS SECURITIES LLC 299 Park Avenue New York, New York 10171   UBS LOAN FINANCE LLC 677 Washington Boulevard Stamford, Connecticut 06901

 

 

August 19, 2012

 

Aetna Inc.

151 Farmington Avenue

Hartford, CT  06156

 

Attention:

Alfred P. Quirk, Jr.

Vice President, Finance and Treasurer

 

 

Ladies and Gentlemen:

 

Aetna Inc., a Pennsylvania corporation (the “Borrower” or “you”), has informed Goldman Sachs Bank USA (“Goldman Sachs”), UBS Loan Finance LLC (“UBSLF”) and UBS Securities LLC (“UBS Securities” and, together with UBSLF, “UBS”) that the Borrower intends to acquire (the “Acquisition”) all the issued and outstanding equity interests in an entity previously identified to us and codenamed “Jaguar” (the “Acquired Company” and, together with its subsidiaries, the “Acquired Business”) pursuant to an Agreement and Plan of Merger dated as of the date hereof among the Borrower, Jaguar Merger Subsidiary, Inc., and the Acquired Company (together with the exhibits and schedules thereto, the “Merger Agreement”) for consideration consisting of shares of the Borrower’s common stock and cash.  Capitalized terms used and not defined in this letter (together with Annexes A, B and C hereto, this “Commitment Letter”) have the meanings assigned to them in Annex B hereto.  Goldman Sachs, UBS and any other Lenders that become parties to this Commitment Letter as additional “Commitment Parties” as provided in Section 3 hereof are referred to herein, collectively, as the “Commitment Parties”, “we” or “us”.

 

You have informed us that the cash consideration payable in connection with the Acquisition and amounts required to pay expenses related to the Transactions will be obtained from the following sources:

 

·	available cash of the Borrower and the Acquired Business in the amount of approximately $1,300,000,000;

 

·	the issuance by the Borrower of its commercial paper for net proceeds of approximately $500,000,000; and

 

·	the issuance by the Borrower of $2,000,000,000 in aggregate principal amount of its senior notes (the “Notes”) pursuant to a registered public offering or Rule 144A or other private placement (the “Notes Offering”);

 

or, in the event the entire principal amount of the Notes has not been issued on or prior to the Closing Date, borrowings by the Borrower of term loans under a senior unsecured bridge facility having the terms set forth on Annex B hereto (the “Facility”) in an aggregate principal amount of $2,000,000,000 less the net cash proceeds received from the issuance of the Notes on or prior to the Closing Date.

 

1.	Commitments; Titles and Roles.

 

In connection with the foregoing, (a) Goldman Sachs is pleased to commit, severally and not jointly, to provide 50% of the principal amount of the Facility, and UBSLF is pleased to commit, severally and not jointly, to provide 50% of the principal amount of the Facility, (b) Goldman Sachs and UBS Securities are pleased to confirm their agreement to act, and you hereby appoint Goldman Sachs and UBS Securities to act, as joint lead arrangers and joint bookrunners in connection with the Facility (in such capacities, the “Arrangers”), (c) Goldman Sachs is pleased to confirm its agreement to act, and you hereby appoint Goldman Sachs to act, as sole administrative agent for the Facility and (d) UBS Securities is pleased to confirm its agreement to act, and you hereby appoint UBS Securities to act, as sole syndication agent for the Facility, in each case on the terms and subject to the conditions set forth in this Commitment Letter and the Fee Letter (as defined below); provided that, the amount of the Facility shall be automatically reduced as provided under “Optional Commitment Reductions and Prepayments” and “Mandatory Commitment Reductions and Prepayments” in Annex B hereto, and that any such reduction will be allocated among the commitments of Goldman Sachs, UBSLF and the additional Commitment Parties ratably or, in the event a Successful Syndication (as defined in the Fee Letter) shall not have been achieved during the Initial Syndication Period (as defined below), in the manner determined by the Arrangers in consultation with the Borrower (it being agreed that the commitments of Goldman Sachs and UBSLF will in any event be reduced by equal amounts).

 

It is agreed that, except during the Initial Syndication Period as provided in the Syndication Plan (as defined below), (a) no other agents, co-agents, arrangers, co-arrangers or bookrunners will be appointed and no other titles will be awarded unless the Arrangers and the Borrower shall so agree, and (b) no compensation will be paid in connection with the Facility unless the Arrangers shall so agree.

 

The fees for, and other amounts to be paid in connection with, the commitments of Goldman Sachs and UBSLF hereunder and the services of Goldman Sachs and UBS related to the Facility are set forth in an Arranger Fee Letter (the “Fee Letter”) being entered into by you, Goldman Sachs and UBS on the date hereof.

 

2.	Conditions Precedent.

 

Each of the Commitment Parties’ commitments and agreements hereunder are subject to (a) the execution and delivery of a credit agreement (the “Credit Agreement”) and other definitive documentation for the Facility prepared by counsel for Goldman Sachs and UBS and reasonably satisfactory to you and the Arrangers, reflecting the terms set forth or referred to in this Commitment Letter and the Fee Letter (modified as provided in the “Market Flex” provisions of the Fee Letter, if applicable), and otherwise substantially consistent with the terms of the Existing Credit Agreement; and (b) the other conditions expressly set forth in Annex C hereto.

 

Notwithstanding anything herein to the contrary, the terms of the Credit Agreement will be such that they do not impair the availability of the Facility on the Closing Date if the conditions set forth in this Section 2 and in Annex C hereto are satisfied.

 

3.	Syndication.

 

The Arrangers reserve the right, in accordance with the provisions of this Section 3, prior to or after the Closing Date, to syndicate the Facility to the Lenders.  During the period of 45 days following the date of this Commitment Letter (the “Initial Syndication Period”), the syndication of the Facility, including determinations as to the timing of offers to prospective Lenders, the selection of Lenders, the acceptance and final allocation of commitments, the awarding of titles or roles to any Lenders and the amounts offered and the compensation provided to each Lender from the amounts to be paid to the Arrangers pursuant to the terms of this Commitment Letter and the Fee Letter, will be conducted jointly by the Arrangers and the Borrower and, except to the extent the Arrangers and the Borrower otherwise agree, in accordance with the syndication plan heretofore discussed by such parties (the “Syndication Plan”).  Without limiting the foregoing, the Facility will be syndicated during the Initial Syndication Period only to Lenders identified in the Syndication Plan (“Designated Lenders”).  Following the Initial Syndication Period, if and for so long as a Successful Syndication has not been achieved, the syndication of the Facility shall be conducted by the Arrangers in consultation with the Borrower, and departures may be made from the Syndication Plan (including in the selection of Lenders) after consultation with the Borrower and to the extent required in the reasonable judgment of the Arrangers to achieve a Successful Syndication.  In connection with any commitments received from Designated Lenders selected in accordance with this paragraph (or other Lenders approved in writing by you), whether before or after the Initial Syndication Period (but prior to the execution and delivery of the Credit Agreement), you agree, at the request of the Arrangers, to enter into one or more customary joinder agreements providing for such additional Lenders to become additional Commitment Parties under this Commitment Letter and extend commitments in respect of the Facility directly to you (it being agreed that, subject to the second paragraph of Section 1, such joinder agreements will contain such provisions relating to titles, the allocation of any reductions in the amount of the Facility and other matters relating to the relative rights of the Arrangers and such additional Commitment Parties as the Arrangers may reasonably request, which provisions, in the case of any joinder agreement entered into during the Initial Syndication Period, will be consistent with the Syndication Plan).  The commitments of Goldman Sachs and UBSLF hereunder with respect to the Facility shall be reduced on a pro rata basis dollar-for-dollar by the amount of each commitment for the Facility received from a Designated Lender (or other Lender approved in writing by you) upon such Lender becoming a party to this Commitment Letter as an additional “Commitment Party” pursuant to a joinder agreement or a party to the Credit Agreement as a Lender.

 

You and the Arrangers agree to use commercially reasonable efforts to negotiate, execute and deliver the Credit Agreement (with the Lenders selected as provided in this Section 3 as parties thereto) as promptly as practicable and in any event within 60 days following the date of this Commitment Letter.

 

You agree to use your commercially reasonable efforts to ensure that the Arrangers’ syndication efforts benefit from your and your affiliates’ existing relationships with banks and other financial institutions.  To facilitate an orderly and successful syndication of the Facility, you agree that, until the earlier of (a) the achievement of a Successful Syndication and (b) 90 days following the date of initial funding under the Facility (such earlier date being called the “Syndication Date”), you will not, and will not permit any of your subsidiaries to, and will use commercially reasonable efforts to cause the Acquired Business not to, syndicate or issue, attempt to syndicate or issue or announce or authorize the announcement of the syndication or issuance (or plans for the syndication or issuance) of, any debt or credit facility or any debt security of the Borrower or any of its subsidiaries or of the Acquired Business (other than (i) the Facility, (ii) the Notes, (iii) commercial paper financings, (iv) prior to the closing of the Acquisition, any

 

indebtedness of the Acquired Business permitted to be incurred under the Merger Agreement and (v) Excluded Debt), without the prior written consent of the Arrangers (such consent to be withheld only if, in the reasonable  judgment of the Arrangers, such financing, syndication or placement would be likely to have a materially detrimental effect on the ability of the Arrangers to syndicate the Facility).  The Borrower agrees that until the Syndication Date it will cause any syndication or issuance of any Excluded Debt referred to in clause (a) or (c) of the definition of such term to be coordinated with the syndication of the Facility in a manner reasonably acceptable to the Borrower and the Arrangers.

 

The Arrangers and the Borrower intend to commence syndication efforts promptly after the execution and delivery of this Commitment Letter.  To assist the Arrangers in such syndication efforts, until the Syndication Date, you agree (a) to prepare and provide, and to use commercially reasonable efforts to cause the Acquired Business to prepare and provide, customary information with respect to the Borrower and its subsidiaries, the Acquired Business and the transactions contemplated hereby reasonably requested by the Arrangers in connection with the syndication of the Facility and (b) to cooperate, and to use commercially reasonable efforts to cause the Acquired Business to cooperate, with the Arrangers in connection with (i) the preparation of one or more information packages (collectively, the “Confidential Information Memorandum”) containing such information regarding the business, operations, assets, liabilities, financial position, pro forma financial statements, projections and prospects of the Borrower and its subsidiaries, the Acquired Business and the transactions contemplated hereby as shall be reasonably deemed necessary by the Arrangers to complete the syndication of the Facility, (ii) the presentation of one or more information packages reasonably acceptable in format and content to the Arrangers (collectively, the “Lender Presentation”) in a reasonable number of meetings and other communications with prospective Lenders in connection with the syndication of the Facility at times to be mutually agreed and upon reasonable notice (including through direct contact between senior management and representatives, with appropriate seniority and expertise, of the Borrower and prospective Lenders and participation of such persons in a reasonable number of meetings with prospective Lenders) and (iii) the obtaining as promptly as practicable, and in any event prior to the commencement of the general syndication of the Facility, of a public rating of the Borrower’s Index Debt from Moody’s Investor Services, Inc. (“Moody’s”) and a public rating of the Borrower’s Index Debt from Standard & Poor’s Ratings Group, a division of The McGraw Hill Corporation (“S&P”), in each case taking into account the Transactions.  You will be solely responsible for the contents of the Confidential Information Memorandum, the Lender Presentation and all other information, documentation or other materials delivered to the Arrangers in connection therewith, and acknowledge that the Arrangers will be using and relying upon such information without independent verification thereof.

 

Notwithstanding anything to the contrary set forth in this Commitment Letter or the Fee Letter or any other agreement, the completion of any syndication of the Facility shall in no event constitute a condition precedent to the commitments hereunder or the funding of the Facility on the Closing Date.

 

You agree that information regarding the Facility and the Information provided by or on behalf of the Borrower, the Acquired Business or their respective affiliates to the Arrangers in connection with the Facility or the other transactions contemplated hereby (including draft and execution versions of the Credit Agreement, the Confidential Information Memorandum, the Lender Presentation, publicly filed financial statements, and draft or final offering materials relating to contemporaneous or prior securities issuances by the Borrower) may be disseminated to prospective Lenders and other persons through one or more internet sites (including an IntraLinks, SyndTrak or other electronic workspace (the “Platform”)) created for purposes of syndicating the Facility or otherwise, in accordance with the Arrangers’ standard syndication practices, and you acknowledge that neither the Arrangers nor any of their affiliates will be responsible or liable to you or any other person or entity for damages arising from the use by others of any Information or other materials obtained on the Platform.

 

You acknowledge that certain of the Lenders may be “public side” Lenders that do not wish to receive material non-public information within the meaning of federal, state or other applicable securities laws with respect to the Borrower, the Acquired Business, their respective affiliates or any securities of any of the foregoing (such information being called “MNPI” and each such Lender being called a “Public Lender”).  At the request of the Arrangers, you agree to prepare, and to use your commercially reasonable efforts to cause the Acquired Business to assist in the preparation of, an additional version of the Confidential Information Memorandum and the Lender Presentation to be used by Public Lenders that does not contain MNPI.  It is understood that, in connection with your assistance described above, you will provide, and cause all other applicable persons to provide, authorization letters to the Arrangers authorizing the distribution of the Information to prospective Lenders and containing a representation to the Arrangers that such versions of the Confidential Information Memorandum and the Lender Presentation do not contain MNPI.  In addition, you agree clearly to designate as such all Information provided to the Arrangers by or on behalf of the Borrower, the Acquired Business or their respective affiliates that is suitable to make available to Public Lenders (it being agreed that distribution of any Information that is not so identified may be restricted by the Arrangers to Lenders that are not Public Lenders).  You acknowledge and agree that the following documents may, after you shall have been given a reasonable opportunity to review them, be distributed to Public Lenders (unless you notify the Arrangers in writing prior to such distribution that any such document contains MNPI, in which case, for so long as a Successful Syndication has not been achieved, you will take such action as shall be reasonably requested by the Arrangers to permit such documents to be distributed to Public Lenders, if any, in connection with their efforts to syndicate the Facility): (a) drafts and final versions of the Credit Agreement, (b) administrative materials prepared by the Arrangers for prospective Lenders (such as a lender meeting invitation, allocations and funding and closing memoranda) and (c) term sheets and notification of changes in the terms and conditions of the Facility.

 

4.	Information.

 

You represent and covenant that (a) all information (other than financial projections and other forward-looking information and information of a general economic or industry nature) (the “Information”) provided by or on behalf of the Borrower or its representatives to the Commitment Parties or the Lenders in written form or in any Lender presentation or due diligence session in connection with the Facility (including, for the avoidance of doubt, all Information set forth in the Confidential Information Memorandum) does not and will not, when furnished, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements contained therein not materially misleading when taken as a whole and in light of the circumstances under which such statements were made (giving effect to any supplements then or theretofore furnished) and (b) the financial projections provided by or on behalf of the Borrower or its representatives to the Commitment Parties or the Lenders in connection with the Facility have been and will be prepared in good faith based upon assumptions that are believed by the Borrower to be reasonable at the time such financial projections are furnished to the Commitment Parties or the Lenders, it being understood and agreed that financial projections are not a guarantee of financial performance and are subject to significant uncertainties and contingencies, many of which are beyond the Borrower’s and/or the Acquired Business’ control, that no assurance can be given that such financial projections will be realized, that actual results may differ from financial projections and that such differences may be material; provided that, prior to the consummation of the Acquisition, such representation with respect to any Information relating to the Acquired Business or its affiliates is made only to the best of your knowledge.  You agree that if at any time prior to the later of (i) the Closing Date and (ii) the Syndication Date, any of the representations in the preceding sentence would be incorrect if such Information or such financial projections were being furnished, and such representations were being made, at such time, then you will (or with respect to Information or financial projections relating to the Acquired Business, you will use commercially reasonable efforts to) promptly supplement, or cause to be supplemented, such Information or such financial projections so that such representations will be correct

 

under those circumstances.  In arranging and syndicating the Facility, the Arrangers will be entitled to use and rely on the Information and the financial projections without responsibility for independent verification thereof, and you acknowledge and agree that the Arrangers will have no obligation to conduct any independent evaluation or appraisal of the assets or liabilities of the Borrower, the Acquired Business or any other person or to advise or opine on any related solvency issues.

 

5.	Indemnification and Related Matters.

 

In connection with arrangements such as this, it is the policy of the Commitment Parties to receive indemnification.  You agree to the provisions with respect to our indemnity and other matters set forth in Annex A, which is incorporated by reference into this Commitment Letter.

 

6.	Assignments.

 

This Commitment Letter may not be assigned by you without the prior written consent of the Arrangers (and any purported assignment without such consent will be null and void) and, except as set forth in Annex A hereto, is intended to be solely for the benefit of the parties hereto and is not intended to confer any benefits upon, or create any rights in favor of or be enforceable by or at the request of, any person other than the parties hereto.  Any Commitment Party may assign its commitment and agreements hereunder, in whole or in part, to any of its affiliates and, in the case of Goldman Sachs and UBSLF, as part of the syndication of the Facility, subject to the provisions of Section 3 hereof, to any Lender; provided that, except as contemplated by Section 3 hereof or as otherwise agreed in writing by the Borrower, in the event that, notwithstanding the satisfaction of all applicable conditions to funding, any Lender (other than a Designated Lender or another Lender approved in writing by the Borrower) shall default on its obligation to fund its commitment in respect of the Facility on the Closing Date, each of Goldman Sachs and UBSLF shall remain severally obligated to assume its ratable share of the unfunded commitment of such Lender and to fund such share of such commitment.

 

7.	Confidentiality.

 

Please note that this Commitment Letter and the Fee Letter, the terms hereof and thereof and any written communications provided by, or oral discussions with, the Arrangers in connection with this arrangement are exclusively for your information and may not be disclosed by you to any other person or circulated or referred to publicly without the prior written consent of the Arrangers; provided that we hereby consent to your disclosure of (a) this Commitment Letter and the Fee Letter, the terms hereof and thereof and such communications and discussions (i) to your officers, directors, employees, partners, agents and advisors (other than financial advisors) who are directly involved in the consideration of the Facility and who have been advised by you of the confidential nature of such information or (ii) pursuant to a subpoena or order issued by a court or by judicial, administrative or legislative body or committee, or as otherwise required by applicable law or compulsory legal process (in which case you agree to inform the Arrangers promptly thereof to the extent not prohibited by law) or required or requested by governmental and/or regulatory authorities, (b) this Commitment Letter and the terms hereof, and a version of the Fee Letter that shall have been redacted in a manner reasonably acceptable to the Arrangers (but not any of the other terms of the Fee Letter), to the Acquired Company, so long as it shall have agreed to treat such information confidentially, and to the Acquired Company’s officers, directors, employees, partners, agents and advisors who are directly involved in the consideration of the Facility and who have been advised of the confidential nature of such information, (c) information regarding the Facility (but not the Fee Letter or the terms thereof) in any prospectus or other offering memorandum relating to the offering of the Notes or any filing with the Securities and Exchange Commission or any other governmental authority in connection with the Acquisition (provided, that the Borrower may include the aggregate amount  payable as fees under the Fee Letter as part of aggregate transaction expenses in a customary sources and uses

 

disclosure in any such filing) and (d) information regarding the Facility and the related transactions (but not the Fee Letter or the terms thereof) to Moody’s and S&P on a confidential basis after consultation with the Arrangers.  Notwithstanding the foregoing, following your acceptance hereof, the Commitment Letter (but not the Fee Letter) may be filed with the Securities and Exchange Commission, and thereafter the foregoing restrictions on the disclosure of the Commitment Letter shall no longer apply.

 

Each Commitment Party will treat as confidential all confidential information provided to it by or on behalf of the Borrower or the Acquired Business hereunder; provided, that nothing herein shall prevent the Commitment Parties from disclosing any such information (i) to any Lenders or participants or prospective Lenders or participants or to any direct or indirect contractual counterparties to any swap or derivative transaction relating to the Borrower or its obligations under the Facility (collectively, “Specified Counterparties”), (ii) to its affiliates and its and their respective officers, directors, members, partners, agents, advisors, employees and representatives on a confidential and need-to-know basis, (iii) pursuant to a subpoena or order issued by a court or by a judicial, administrative or legislative body or committee, or as otherwise required by applicable law or compulsory legal process or required or requested by governmental and/or regulatory authorities, including any self-regulatory organization (in which case such Commitment Party agrees to inform the Borrower promptly thereof to the extent not prohibited by law, except to the extent in connection with a request from a regulatory authority having jurisdiction over it or its affiliates), (iv) as requested by any state, federal or foreign authority or examiner regulating banks or banking or otherwise having jurisdiction over such Commitment Party or its affiliates, (v) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Commitment Letter or the Fee Letter, or enforcement hereof or thereof, or the assertion of any due diligence defense, (vi) to the extent such confidential information is publicly available or becomes publicly available other than as a result of a breach of this provision, (vii) provided to it from a source, other than the Borrower, the Acquired Business or their respective affiliates, which is not to such Commitment Party’s knowledge subject to any confidentiality or fiduciary obligation to the Borrower or the Acquired Business with respect to such information, (viii) to Moody’s and S&P and other rating agencies or to market data collectors or similar service providers to the lending industry and service providers to the Arrangers and the Lenders in connection with the administration and management of the Facility; provided that such information is limited to Annex B and Annex C hereto and is supplied only on a confidential basis, and (ix) to the extent that such information was already in the Commitment Parties’ possession (other than as a result of any Commitment Party being provided such information by or on behalf of the Borrower or the Acquired Business hereunder) or is independently developed by the Commitment Parties; provided, that the disclosure of any such information to any Lenders or prospective Lenders or participants or prospective participants or Specified Counterparties referred to above shall be made subject to the acknowledgment and acceptance by such Lender or prospective Lender or participant or prospective participant or Specified Counterparty that such information is being disseminated on a confidential basis in accordance with the standard syndication process of the Arrangers or customary market standards for dissemination of such types of information, subject to customary confidentiality restrictions that are no less restrictive in any material respect than those in this paragraph; and provided, further, that the foregoing obligations of the Commitment Parties shall remain in effect until the earlier of (i) 18 months from the date hereof and (ii) the execution and delivery of the Credit Agreement by the parties thereto, at which time any confidentiality undertaking in the Credit Agreement shall supersede the provisions in this paragraph.  Notwithstanding the foregoing, following your filing of the Commitment Letter with the Securities and Exchange Commission, the foregoing restrictions shall no longer apply insofar (and only insofar) as they relate to the disclosure of this Commitment Letter and the terms hereof.

 

8.	Absence of Fiduciary Relationship; Affiliates; Etc.

 

 

including commercial and investment banking, financial advisory, market making and trading, investment management (both public and private investing), investment research, principal investment, financial planning, benefits counseling, risk management, hedging, financing, brokerage and other financial and non-financial activities and services globally.  In the ordinary course of their various business activities, each of the Arranger Parties and funds or other entities or persons in which each of the Arranger Parties co-invests may at any time purchase, sell, hold or vote long or short positions and investments in securities, derivatives, loans, commodities, currencies, credit default swaps and other financial instruments for their own account and for the accounts of their customers. In addition, each of the Arranger Parties may at any time communicate independent recommendations and/or publish or express independent research views in respect of such assets, securities or instruments.  Any of the aforementioned activities may involve or relate to assets, securities and/or instruments of the Borrower, the Acquired Business, their respective affiliates and other entities and persons that may be involved in transactions arising from or relating to the arrangement contemplated by this Commitment Letter or have other relationships with the Borrower, the Acquired Business or their respective affiliates.  In addition, each of the Arranger Parties may provide investment banking, commercial banking, underwriting and financial advisory services to such other entities and persons.  The arrangement contemplated by this Commitment Letter may have a direct or indirect impact on the investments, securities or instruments referred to in this paragraph, and employees working on the financing contemplated hereby may have been involved in originating certain of such investments and those employees may receive credit internally therefor.  Although the Arranger Parties in the course of such other activities and relationships may acquire information about the transactions contemplated by this Commitment Letter or other entities and persons that may be the subject of the financing contemplated by this Commitment Letter, none of the Arranger Parties shall have any obligation to disclose such information, or the fact that such Arranger Party is in possession of such information, to you or any of your affiliates or to use such information on your or your affiliates’ behalf.

 

Consistent with the policies of each of the Arranger Parties to hold in confidence the affairs of its customers, neither of the Arranger Parties will furnish confidential information obtained from you by virtue of the transactions contemplated by this Commitment Letter to any of its other customers.  Furthermore, you acknowledge that the Arranger Parties and their respective affiliates have no obligation to use in connection with the transactions contemplated by this Commitment Letter, or to furnish to you, confidential information obtained or that may be obtained by them from any other person.

 

Each of the Arranger Parties may have economic interests that conflict with yours or those of your equityholders or affiliates.  You agree that each of the Arranger Parties will act under this Commitment Letter as an independent contractor and that nothing in this Commitment Letter or the Fee Letter or otherwise will be deemed to create an advisory, fiduciary or agency relationship or fiduciary or other implied duty between either Arranger Party, on the one hand, and you or your equityholders or affiliates, on the other hand with respect to the financing transactions contemplated hereby.  You acknowledge and agree that the financing transactions contemplated by this Commitment Letter and the Fee Letter (including the exercise of rights and remedies hereunder and thereunder) are arm’s-length commercial transactions between each of the Arranger Parties, on the one hand, and you, on the other, and in connection therewith and with the process leading thereto, (a) neither of the Arranger Parties has assumed advisory or fiduciary responsibilities in favor of you or your equityholders or affiliates with respect to the financing transactions contemplated hereby (or the exercise of rights or remedies with respect thereto) or the process leading thereto (irrespective of whether any Arranger Party has advised, is currently advising or will advise you or your equityholders or affiliates on other matters) or any other obligation to you, except the obligations expressly set forth in this Commitment Letter and the Fee Letter and (b) each of the Arranger Parties is acting solely as a principal and not as an agent or fiduciary of you or your management, equityholders, affiliates, creditors or any other person in connection with the financing transactions contemplated by this Commitment Letter and the Fee Letter.  You acknowledge and agree

 

that you have consulted your own legal and financial advisors to the extent you deemed appropriate and that you are responsible for making your own independent judgment with respect to such financing transactions and the process leading thereto.  You agree that you will not claim that either of the Arranger Parties has rendered advisory services of any nature or respect, or owes a fiduciary or similar duty to you, in connection with such financing transactions or the process leading thereto.  As you know, Goldman Sachs and UBS Securities have been retained by you as financial advisors (in such capacity, the “Financial Advisors”) in connection with the Acquisition.  You agree not to assert any claim you might allege based on any actual or potential conflicts of interest that might be asserted to arise or result from, on the one hand, the engagement of the Financial Advisors and, on the other hand, the Arranger Parties and their affiliates’ relationships with you as described and referred to herein.  In addition, the Arranger Parties may employ the services of their affiliates in providing services and/or performing their obligations hereunder and may exchange with such affiliates information concerning the Borrower, the Acquired Business and other entities or persons that may be the subject of this arrangement, and such affiliates will be entitled to the benefits afforded to the Arranger Parties hereunder.

 

In addition, please note that the Arranger Parties do not provide accounting, tax or legal advice.

 

Notwithstanding anything herein to the contrary, the Borrower (and each employee, representative or other agent of the Borrower) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the Facility and all materials of any kind (including opinions or other tax analyses) that are provided to the Borrower relating to such tax treatment and tax structure.  However, any information relating to the tax treatment or tax structure will remain subject to the confidentiality provisions hereof (and the foregoing sentence will not apply) to the extent reasonably necessary to enable the parties hereto, their respective affiliates and their respective affiliates’ directors and employees to comply with applicable securities laws.  For this purpose, “tax treatment” means U.S. federal or state income tax treatment, and “tax structure” is limited to any facts relevant to the U.S. federal income tax treatment of the transactions contemplated by this Commitment Letter but does not include information relating to the identity of the parties hereto or any of their respective affiliates.

 

9.	Miscellaneous.

 

The Commitment Parties’ commitments and agreements hereunder will automatically terminate upon the first to occur of (a) the consummation of the Acquisition, (b) the termination of the Merger Agreement or the public announcement by you of your intention not to proceed with the Acquisition, (c) the execution of the Credit Agreement by the parties thereto and (d) August 19, 2013 or, if the “End Date” referred to in the Merger Agreement is extended to a later date as provided in Section 10.01(b)(i) of the Merger Agreement, such later date (but in any event no later than November 19, 2013) (the date referred to in this clause (d) being called the “End Date”).

 

The provisions set forth under Sections 5 (including Annex A), 7 and 8 hereof and this Section 9 and the provisions of the Fee Letter will remain in full force and effect notwithstanding the expiration or termination of this Commitment Letter or the commitments and agreements hereunder; provided that your  and our obligations under this Commitment Letter (other than those under Sections 3, 4, 7 (solely as it relates to restrictions on your disclosure of the Fee Letter), 8 and, to the extent applicable, this Section 9 and the provisions of the Fee Letter, all of which shall survive), shall automatically terminate and be of no further force and effect (and, if applicable, shall be superseded by the Credit Agreement) on the date the Credit Agreement is executed, and you and we shall be automatically released from all liability hereunder in connection therewith at such time (provided, that Section 5 (including Annex A) will so terminate and be superseded only to the extent the Credit Agreement contains provisions affording the Commitment Parties rights to expense reimbursement and indemnity not less comprehensive than those provided for in such Section 5).

 

Each party hereto agrees, for itself and its affiliates, that any suit, action or proceeding arising in respect of this Commitment Letter or the Commitment Parties’ commitments or agreements hereunder or the Fee Letter brought by it or any of its affiliates shall be brought, and shall be heard and determined, exclusively in any Federal court of the United States of America sitting in the Borough of Manhattan or, if that court does not have subject matter jurisdiction, in any state court located in the City and County of New York.  Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and its property, to the jurisdiction of, and to venue in, such court and irrevocably and unconditionally waives any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising in respect of this Commitment Letter or the Commitment Parties’ commitments or agreements hereunder or the Fee Letter in any such court and any defense of any inconvenient forum to the maintenance of any such suit, action or proceeding in any such court.  Each of the parties hereto agrees that a final judgment in any such suit, action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.  Service of any process, summons, notice or document by registered mail or overnight courier addressed to any of the parties hereto at the addresses above (and, in the case of service upon the Borrower, with a copy delivered by registered mail or overnight courier addressed to Aetna Inc., 151 Farmington Avenue, Hartford, CT  06156, Attention:  General Counsel) shall be effective service of process against such party for any such suit, action or proceeding brought in any court.  Any right to trial by jury with respect to any suit, action or proceeding arising in connection with or as a result of either the Commitment Parties’ commitments or agreements hereunder or the Fee Letter or any matter referred to in this Commitment Letter or the Fee Letter is hereby irrevocably and unconditionally waived by the parties hereto.  This Commitment Letter and the Fee Letter will be governed by and construed in accordance with the laws of the State of New York without regard to principles of conflicts of laws; provided that (a) the interpretation of the definition of Acquired Business Material Adverse Effect and whether there shall have occurred an Acquired Business Material Adverse Effect, (b) whether the Acquisition has been consummated as contemplated by the Merger Agreement and (c) whether the representations and warranties made by the Acquired Company in the Merger Agreement are accurate and whether as a result of any inaccuracy thereof the Borrower has the right to terminate its obligations under the Merger Agreement or not to consummate the Acquisition, shall be determined in accordance with the laws of the State of Delaware without regard to principles of conflicts of laws that would result in the application of the laws of another jurisdiction.

 

The Arrangers hereby notify you that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Patriot Act”) the Arrangers and each Lender may be required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow the Arrangers and each Lender to identify the Borrower in accordance with the Patriot Act.  This notice is given in accordance with the requirements of the Patriot Act and is effective for the Arrangers and each Lender.

 

This Commitment Letter may be executed in any number of counterparts, each of which when executed will be an original, and all of which, when taken together, will constitute one agreement.  Delivery of an executed counterpart of a signature page of this Commitment Letter by facsimile transmission or electronic transmission (in pdf format) will be effective as delivery of a manually executed counterpart hereof.  This Commitment Letter and the Fee Letter are the only agreements that have been entered into among the parties hereto with respect to the Facility and set forth the entire understanding of the parties hereto with respect thereto and supersede any prior written or oral agreements between the parties hereto with respect to the Facility.  This Commitment Letter may not be amended, and no term or provision hereof may be waived or modified, except by an instrument in writing signed by each of the parties hereto; provided, that any amendment, waiver or modification that affects only the rights or obligations of Goldman Sachs and UBS may be effected by the Borrower and Goldman Sachs and UBS without the

 

consent of any other Commitment Party.  The Fee Letter may not be amended, and no term or provision thereof may be waived or modified, except by an instrument in writing signed by each of the parties thereto.

 

[Remainder of page intentionally left blank]

 

Please confirm that the foregoing is in accordance with your understanding by signing and returning to the Arrangers the enclosed copy of this Commitment Letter, together, if not previously executed and delivered, with the Fee Letter, on or before the close of business on August 20, 2012, whereupon this Commitment Letter and the Fee Letter will become binding agreements between Goldman Sachs, UBS and you.  If this Commitment Letter and the Fee Letter have not been signed and returned as described in the preceding sentence by such date, this offer will terminate on such date.  We look forward to working with you on this transaction.

 

 

 

 

 

 

Notwithstanding the foregoing, (x) the Borrower’s obligation to reimburse legal expenses shall, in connection with any one action or proceeding or separate but substantially similar actions or proceedings arising out of the same general allegations, be limited to the fees, charges and disbursements of one counsel for all Indemnified Persons (and, if reasonably necessary, one local counsel plus one specialist counsel in, respectively, any relevant jurisdiction or applicable specialty), which, if the Arrangers or their affiliates shall be parties or potential parties to any such action or proceeding, shall be selected by the Arrangers, and, solely in the case of an actual or potential conflict of interest affecting any Indemnified Person or Indemnified Persons, of one additional counsel (and if reasonably necessary, one local counsel plus one specialist counsel in, respectively, any relevant jurisdiction or applicable specialty) for the affected Indemnified Person or Indemnified Persons and (y) to the extent that it is found by a judgment of the highest court of competent jurisdiction to have considered such matter that an Indemnified Person is not entitled to indemnification because such loss, claim, damage or liability resulted from the bad faith, gross negligence or willful misconduct of such Indemnified Person (or any of its controlling persons or subsidiaries of controlling persons or any of their or such Indemnified Person’s partners, members, directors, agents, employees or controlling persons) in performing the services that are the subject of the Letters, or the material breach of the material agreements of such Indemnified Person set forth in one or both of the Letters, then such Indemnified Person will refund to the Borrower any portion of the reimbursed amounts that is attributable to expenses incurred in relation to the act or omission of such Indemnified Person which is the subject of such finding; provided, that any amount so refunded shall be returned by the Borrower if such finding is overturned by a higher court.