For the attention of Mr Marius Kohl

Administration des Contributions Directes

Bureau d'lmposition des societes VI
18, rue du fort Wedell
L - 2982 Luxembourg

Priccwaterhoust..-Coopcrs
Socictc ii rcsponsabilile limitcc
Reviseur d'entrcpriscs
400, route d'Esch

B.P. 1443
L-1014 Luxembourg
Telephone +352 494848-1
Facsimile 352 494848-2900
www.pwc.com/ lu
in fo@lu.pwc.com

Mayl3, 2009

References: VCO/ROIM/LTTY/Q5709003M-GYVN
Abbott Investments Luxembourg S.ar.I. - Tax number in process
Abbott International Luxembourg S.ar.I. - Tax number in process
Abbott Overseas Luxembourg S.ar.I. - Tax number in process
Abbott Holding Subsidiary (Gibraltar) Limited Luxembourg S.C.S - Tax number in
process

Dear Mr Kohl,
Further to our discussion dated January 14, 2009 and, at the request of the Abbott group,
we would like to confinn your approval and/or obtain your comments on the Luxembourg
tax treatment described in this letter in relation to operations to be carried out in
Luxembourg in the future.

Facts

A.1 Background
1.

The Abbott group is a leading provider of innovative health care products and
is devoted to discovering new medicines, new technologies and new ways to
manage health.

2.

The parent of the group, Abbott Laboratories (referred as "Abbott Labs"), is a

US resident company and the group is present in a large number of countries.
The holding and financing structures of the group are currently being reshaped
in order to allow for tax efficient future business acquisitions by Abbott Labs
and a cost-effective financing of group activities.

R.C.S. Luxembourg 1.165 477 - TV A LU 17564447

A.2 Restructuring

3.

Prior to the reorganization, the Abbott group did not have any Luxembourg
entities.

4.

For your information, you will find attached in Enclosure 1 to this letter,
a simplified organization chart swnmarizing the structure prior to this
reorganization.

5.

The relevant restructuring steps from a Luxembourg income tax perspective,

as well as a simplified organizational chart upon completion of the
reorganization are attached in Enclosure 2 to this letter.

Tax analysis

B.l L uxembourg tax residency of Abbott Investments Luxembourg S.a r.I, Abbott
International Luxembourg S.ar.1 and Abbott Overseas Luxembourg S.a r.1
6.

According to article 159 of the Luxembourg Income Tax Law ("LITL"),

capital companies that have either their registered office or their place of
central administration in Luxembourg are subject to corporate income tax on
their profits. Article 159 LITL provides that a limited liability company
(societe a responsabilitc limitee - referred as "S.a r.l") qualifies as a capital
company.

7.

Abbott Investments Luxembourg S.a r.l, Abbott International Luxembourg

S.a r.I and Abbott Overseas Luxembourg S.ar.l (referred as "Lux S.a r.ls") will
be S.a r.ls, and will have their statutory seats located in Luxembourg.

8.

Moreover, the Lux S.a r.ls will have their place of central administration in
Luxembourg to the extent that their shareholders' meetings and their board
meetings will be held in Luxembourg, that the main management decisions will
be effectively taken in Luxembourg and that their accounting will be done in
Luxembourg.

9.

As a result, the Lux S.a r.ls will be considered as fully taxable

Luxembourg-resident capital companies. Tax residency certificates will be
issued upon request.

10.

Copies of the articles of association of the Lux S.a r.Is are attached m
Enclosure 3 to this letter.

(2)

B.2

B.3

11.

Given its tax transparent character, Abbott Holding Subsidiary (Gibraltar)

Limited Luxembourg S.C.S (referred as "Lux S.C.S") will not be subject to
corporate income tax or net wealth tax in its own name (article 175 LITL and
article 11 bis Loi d' Adaptation).

12.

The two partners of Lux S.C.S, i.e. Abbott Holding (Gibraltar) Limited and
Abbott Holding Subsidiary (Gibraltar) Limited (both incorporated under the
law of Gibraltar - referred respectively as "GibCo 1" and "GibCo2") , will not
be tax resident in Luxembourg and will not hold their interest in Lux S.C.S
through a pennanent establishment in Luxembourg.

13.

As Lux S.C.S will not exploit a commercial enterprise in Luxembourg, neither

Lux S.C.S nor its partners will be subject to corporate income tax (referred as
"CIT"), municipal business tax (referred as "MBT"), or net wealth tax (referred
as "NWT"), in Luxembourg.

14.

The analysis of the tax treatment of Lux S.C.S and of its partners is detailed in
Enclosure 4.

15.

A copy of the articles of association of Lux S.C.S is attached in Enclosure 5 to

this letter.

Withholding tax on dividends payments made by Abbott International

Luxembourg S.ar.l to Lux S.C.S
16.

Due to the tax transparency of Lux S.C.S, dividend payments made by Abbott
International Luxembourg S.ar.l to Lux S.C.S will be regarded for Luxembourg
tax purposes as payments made directly to its non-resident partners Gibco l
and Gibco 2.

17.

Since the Gibraltar companies are falling under the application of the Council
Directive 90/435/EEC, the dividend distribution that will be carried out by
Abbott International Luxembourg S.ar.l will not be subject to any Luxembourg
withholding tax provided that the Gibraltar companies comply with the
minimum threshold and holding period requirement provided by article 147
LITL (detailed in Enclosure 6).

18.

The analysis of the eligibility of Gibraltar companies to the benefit of the

Council Directive 90/435/EEC is detailed in Enclosure 7.

(3)

8.4 Master Facility Agreement (referred as "MFA")

19.

Further to Step 78 of the envisaged restructuring (please refer to Enclosure 2),

a MFA will be put in place between Lux S.C.S and Abbott International
Luxembourg S.a r.l.

20.

A copy of the executed MFA is attached in Enclosure 8 to this letter..

B.4.1 Tax treatment of the MFA

21.

The MFA will be considered debt for CIT, MBT and NWT purposes, and
interest thereon will be considered fully tax deductible (see Enclosure 9 for
a description of the MFA).

B.4.2 Financial on-lending activity

22.

Taking into account the features of the financial on-lending activity covered in
the Tranche A and B of the MFA, Abbott International Luxembourg S.a r.l will
be deemed to realize an appropriate and acceptable profit with respect to
Articles 56 of the LITL and 164 (3) of the LITL if it realizes a margin (after
deduction of the charges incurred by Abbott International Luxembourg S.a r.l)
in respect of this activity that will depend on the amount involved in the
financing operations (see Enclosure 9 for further details).

23.

Tranche C of the MFA, which will be financing participations held by Abbott

International Luxembourg S.a r.l, will bear an ann's length interest rate of
7,6573% on the principal average amount aJJocated to this tranche (i.e.,
0.5 times the aggregate of (i) the Tranche C amount as of the first day of the
relevant accounting period and (ii) the Tranche C amount as of the last day of
the relevant accounting period).

B.4.3 Treatment of Inter est Payments under the MFA

24.

Neither the payments of interest (or the accruing of interest), nor the
reimbursement of the principal amount of the MF A will be treated as dividend
distributions in the meaning of Articles 97 and 146 (1)-(3) of the LITL. Hence,
these payments (or accruals) will not be subject to withholding tax pursuant to
Luxembourg domestic law. Interest payments will be fully tax deductible at the
level of Abbott International Luxembourg S.a r.l..

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25.

Only interest paid in connection with Tranche C of the MFA (i.e.,

't , \
shareholdings qualifying for the Luxembourg participation exemption regime)
may be subject to the recapture mechanism provided by Article 166(5) of the
LITL and article I (2) of the Grand-Ducal Decree of 21 December 2001 in
execution to AJ1icle 166 of the LITL.

26.

The Luxembourg thin capitalization rules will be respected at the level of

Abbott International Luxembourg S.a r.I since its shares held in Abbott
Investments Luxembourg S.a r.l and Abbott Overseas Luxembourg S.a r.l will
be financed up to 85% by tranche C of the MFA.

B.4.4 Net wealth tax

B.S

B.6

27.

For NWT purposes, the non-qualifying financial assets (i.e. all the assets at the
exclusion of the assets qualifying for the Luxembourg participation exemption
regime), in so far as they are not financed by a specific debt, will be deemed to
be financed in priority by Tranche A or Tranche B of the MFA. The equity of
Abbott International Luxembourg S.a r.I will be deemed to finance by priority
participations qualifying for the Luxembourg participation exemption regime.

28.

Finally, depending on the additional investments that may be made dming the
existence of the structure, the MFA could be amended to include new tranches.
Should it be the case, we will update you on this.

Tax treatment of the potential reimbursement of share capital of Abbott

Investments Luxembourg S.a r.1
29.

If undertaken, this reimbursement of share capital should not trigger any

impact from a Luxembourg tax perspective.

30.

The analysis of the tax treatment of the reimbursement of share capital of

Abbott Investments Luxembourg S.a r.l should it arise is detailed in
Enclosure 10.

Financing of Abbott Investments Luxembourg S.a r.I

31.

For the sake of clarity and for simplification pw-poses at the level of Abbott
Investments Luxembourg S.a r.I, for CIT, MBT and NWT purposes, any
potentia~ debts financing Abbott Investments Luxembourg S.a r.I will be
deemed to finance in priority first other assets than participations qualifying for
the Luxembourg participation exemption regime, then participations qualifying
for the Luxembourg participation exemption regime.

(5)

32.

Abbott International Luxembourg S.a r.l will benefit from the Luxembourg
participation exemption regime in Luxembourg for its qualifying participations
in Abbott Investments Luxembourg S.a r.l and Abbott Overseas Luxembourg
S.a r.l with respect to dividends and capital gains derived in relation to their
qualifying participations, provided Abbott International Luxembourg S.a r.I has
held or commits to hold a participation of at least l 0% (or with an acquisition
price of at least EUR 1.2 M for dividends and EUR 6 million for capital gain)
in each above mentioned company for an uninterrupted period of at least
12 months pursuant to Article 166 of the LITL and the Grand Ducal Regulation
of 21December2001 for the application of Article 166 of the LITL.

33.

Expenses directly linked to Abbott International Luxembourg S.a r.l's exempt

participations in Abbott Investments Luxembourg S.a r.l and Abbott Overseas
Luxembourg S.a r.l (mainly interest expenses on Tranche C of the MF A) could
be subject to the recapture mechanism. Please refer to Enclosure 11 for further
details in this respect.

B.7.2 At the level of Abbott Overseas L uxembour g S.a r.l

34.

Further to Step 4, Step 60A, Step 60B, and Step 62FF of the envisaged
restructuring (please refer to Enclosure 2), Abbott Overseas Luxembourg
S.a r.l will hold a 100% participation (totally equity financed) in
Abbott Overseas Sub Holding (Cyprus) Limited.

35.

Abbott Overseas Sub Holding (Cyprus) Limited has one of the forms listed
under Art. 2 of the Parent/Subsidiary Directive and will be subject to corporate
income tax in Cyprus.

36.

Accordingly, Abbott Overseas Luxembourg S.ar.I will benefit from the

Luxembourg participation exemption regime in Luxembourg for its
participation in Abbott Overseas Sub Holding (Cyprus) Limited with respect to
dividends and capital gains derived therefrom, provided Abbott Overseas
Luxembourg S.ar.l has held or commits to hold a participation of at least 10%
(or with an acquisition price of at least EUR 1.2 M for dividends and
EUR 6 million for capital gain) in the relevant above mentioned company for
an uninterrupted period of at least 12 months pursuant to Alticle 166 of the
LITL and the Grand Ducal Regulation of21December2001 for the application
of Article 166 of the LITL.

37.

The participation in Abbott Overseas Sub Holding (Cyprus) Limited being

fully equity financed at the level of Abbott Overseas Luxembourg S.a r.l, the
recapture mechanism will not apply.

(6)

38.

Please refer to Enclosure 11 for further details in this respect.

B.7.3 At the level of Abbott Investments Luxembourg S.a r.I

39.

Further to Step 16 to Step 57 and Step 63 to Step 73 of the envisaged

restructuring (please refer to Enclosure 2), Abbott Investments Luxembourg
S.a r.l will hold participation in CFCs.

40.

Provided that conditions of Article 166 of the LITL and the Grand Ducal
Regulation of 21 December 2001 for the application of Article 166 of the LITL
are fulfilled, Abbott Investments Luxembourg S.a r.l will benefit from the
Luxembourg participation exemption regime in Luxembourg for its qualifying
participations in CFCs with respect to dividends and capital gains derived in
relation to its qualifying participations.

41.

Expenses directly linked to Abbott Investments Luxembourg S.a r.l's exempt

participations in CFCs would be subject to the recapture mechanism.

42.

Please refer to Enclosure 11 for further details in this respect.

B.8 Debt-to-equity ratio of Lux S.a r.ls for the financing of their participations
43.

It is the practice of the Luxembowg tax authorities to accept that participations

held by Luxembourg companies are financed by intra-group debt up to 85%.
Other assets may be fully financed by intra-group debt.

44.

Please note that the Luxembourg thin capitalization rules will be respected at
the !eve[ of the Lux S.a r.ls.

B.9 Functional currency

45.

The accounts and the share capital of the Lux S.a r.ls will be denominated
in USD.

46.

Furthermore, USD will he the functional currency of the Lux S.a r.ls for tax
purposes as from the date of their incorporation for a period of at least
l 0 years. This implies that their tax returns will be established on the basis of
the yearly net profits converted into EUR by using the year-end market
EUR/USD rate.

(7)

Taking into account the importance of the above for our client, we would appreciate your
written confinnation of the above treatment.
We remain at yow- entire disposal should you require any further information.
We thank you in advance for the attention you will pay to our request.

'~/\_
Razvan Bruno Ifhm
Manager

For approval '

Le prepose du bureau d'imp sition S ocietes VI

Marius Ko ii
Luxembourg,

1 2 UIN 2009

Enclosures:
Enclosure 1:
E n closure 2:
Enclos ure 3:

Enclosure 4:
Enclosure 5:
Enclosure 6:
Enclosure 7:
Enclosure 8:
Enclosu re 9:
Enclosure 10:
Enclosure 11:

2009

Simplified existing structw-9

Proposed restructuring steps' and simplified final structure
1
Articles of association of Al bott Investments Luxembourg S.ar.I,
Abbott International Luxe1 bourg S.ar.l and Abbott Overseas
1
Luxembourg S.a.r.l
Analysis of the tax treatme . t of Lux S.C.S and of its partners
Articles of association of Abbott Holding Subsidiary (Gibraltar) Limited
\
Luxembourg S.C.S
Article 147 LTTL
Status of the Gibraltar comp~es
Master Facility Agreement ~
Tax treatment of the Master Facility Agreement
Tax treatment of the reimbursement of share capital of Abbott
Investments Luxembourg S.ar.1
Luxembourg participation exemption regime

This tax agreement is based on the facts as presented to PricewaterhouseCoopers Sari ar at the dme the t1dvicc was given. The
agreement is dependent on spec/fie.facts and circumstances and may not be appropriare to anorher parry than the one.for which it waf
prepared 171is tax agreeme111 was prepared wirh only the interests of Abbott group in mind. and was not planned or carried ow in
contemplation of any use by any other party. PricewaterhouseCoopers SO.rl, its partrrers. employees and or age111s, neither owe nor
accept any duty ofcare or any responsibility to any other party, whether in conrract or in tort (including without limitation. negligence
or breach ofstatutory duty) however arising. and shall not be liable in respect ofany loss. damage or expense of whatever narure which
is caused to any other parry.

(8)

Enclosure 1

Simplified pre-reorganisation structure

Abbott Laboratories
(US)

CFCs

Abbott Health
Products Inc.
(Delaware)

Abbott Universal Ltd.

(Delaware)

Abbott Hospitals
Limited (Bahamas)

(9)

Enclosure 2

Restructuring steps and simplified final structure

A.

Restructuring steps

The relevant steps from a Luxembourg tax perspective are the fo llowing:
Step 2: Abbott Labs will incorporate Abbott Investments Luxembourg S.a r.l
Step 3: Abbott Health Products Inc. will incorporate Abbott Overseas Luxembourg S.a r.I
Step 4: Abbott Overseas Luxembourg S.ar.l will incorporate Abbott Overseas Sub Holding
(Cyprus) Limited.
Step 6: Abbott Universal Ltd. will form Abbott Holding (Gibraltar) Limited.
Step 7: Abbott Holding (Gibraltar) Limited will fonn Abbott Holding Subsidiary
(Gibraltar) Limited
Step 9: Abbott Holding (Gibraltar) Limited and Abbott Holding Subsidiary (Gibraltar)
Limited will form Abbott Holding Subsidiary (Gibraltar) Limited Luxembourg S.C.S.
Step 11: Abbott Holding Subsidiary (Gibraltar) Limited Luxembourg S.C.S will fo1m
Abbott International Luxembourg S.a r.1
Step 14: Abbott Labs will contribute Abbott Universal Ltd. to Abbott Health Products Inc.
Step 16 to Step 57: Abbott Labs will contribute E.U/non E.U entities (referred as "CFCs")
to Abbott Investments Luxembourg S.a r.l in exchange for shares.
Step 58: Abbott Labs will contribute Abbott Investments Luxembourg S.a r.l to Abbott
Health Products Inc.
Step 59A: Abbott Health Products Inc. will contribute Abbott Hospitals Limited to Abbott
Overseas Luxembourg S.a r.l
Step 59B: Abbott Health Products Inc. will contribute Abbott Diagnostics International
Limited to Abbott Overseas Luxembourg S.a r.l

(10)

Step 60A: Abbott Overseas Luxembourg S.a r.l will contribute Abbott Hospitals Limited
to Abbott Overseas Sub Holding (Cyprus) Limited.
Step 60B: Abbott Overseas Luxembourg S.a r.l will contribute Abbott Diagnostics
International Limited to Abbott Overseas Sub Holding (Cyprus) Limited.
Step 61: Abbott Health Products Inc. will contribute Abbott Overseas Luxembourg S.a r.I
and Abbott Investments Luxembourg S.a r.l to Abbott Universal Ltd.
Step 62CC: Abbott Universal Ltd. will contribute Abbott C.V. to Abbott Overseas
Luxembourg S.a r.l
Step 62FF: Abbott Overseas Luxembourg S.a r.l will contribute Abbott C.V. to Abbott
Overseas Sub Holding (Cyprus) Limited.
Step 63 to Step 73: Abbott Universal Ltd. will contribute others CFCs to Abbott
Investments Luxembourg S.ar.l in exchange for shares.
Step 74: Abbott Universal Ltd. will contribute Abbott Investments Luxembourg S.a r.l and
Abbott Overseas Luxembourg S.a r.l to Abbott Holding (Gibraltar) Limited.
Step 75: Abbott Holding (Gibraltar) Limited will contribute 1% of Abbott Investments
Luxembourg S.a r.I and Abbott Overseas Luxembourg S.a r.l to Abbott Holding Subsidiary
(Gibraltar) Limited.
Step 76: Abbott Holding Subsidiary (Gibraltar) Limited will contribute l % of Abbott
Investments Luxembourg S.a r.I and Abbott Overseas Luxembourg S.a r.I to
Abbott Holding Subsidiary (Gibraltar) Limited Luxembourg S.C.S.
Step 77: Abbott Holding (Gibraltar) Limited will contribute 99% of Abbott Investments
Luxembourg S.a r.l and Abbott Overseas Luxembourg S.a r.l to Abbott Holding Subsidiary
(Gibraltar) Limited Luxembourg S.C.S.
Step 78: Abbott Holding Subsidiary (Gibraltar/US) Limited Luxembourg S.C.S. will
contribute 15% and sell 85% of Abbott Investments Luxembourg S.ar.l and Abbott
Overseas Luxembourg S.a r.l to Abbott International Luxembourg S.ar.l in exchange for
shares and a note payable issued under a Master Facility Agreement.
Step 79: Abbott Investments Luxembourg S.a r.l, Abbott International Luxembourg S.a r.1
and Abbott Overseas Luxembourg S.a r.I may form a Luxembourg fiscal unity. Abbott
International Luxembourg S.a r.I will be the parent company.

(I I)

At a later stage, Abbott Investments Luxembourg S.a r.1 may redeem part of the
outstanding shares held by Abbott International Luxembourg S.a r.I in exchange for
(Conve11ible) Preferred Equity Certificates (refetTed as "(C)PECs") or Preferred Equity
Certificates (referred as "PECs"). Should it be the case, we will revert to you on the
applicable tax treatment of such instruments.
Finally, at the same moment as the above mentioned share redemption note that Abbott
Investments Luxembourg S.a r.J could also grant intra-group loans and therefore would
hold receivables towards its subsidiaries.

(12)

B.

Simplified proposed structure of the group

Abbott Laboratories
(US)

Abbott Health
Products Inc.
(Delaware)
Abbott Universal Ltd.
(Delaware)

Abbott Holding
Gibraltar Ltd.
(Gibraltar)

99%

Abbott Holding
Subsidiary Gibraltar Ltd
(Gibraltar)

MFA

---------,
Tranche A :
Abbott International
Luxembourg Sari
(Luxembourg)

Fiscal Unity

Tranche 8 :
I

Tranche

C:
I
I

(C)PEC/PEj:s (contemplated)
Abbott Overseas
Luxembourg Sari
(Luxembourg)

Abbott Investments
Luxembourg Sari
(Luxembourg)
Receivables
(contemplated)

Abbott Overseas Sub

Holding (Cyprus) Ltd
(Cyprus)
CFCs

Abbott Diagnostics
International Ltd

(13)

Enclosure 3
Articles of association of Abbott Investments Luxembourg S.a r .l,
Abbott International Luxembourg S.a r.l
and Abbott Overseas Luxembourg S.a r.l

(1 4)

Enclosure 4

Analysis of the tax treatment of Lux S.C.S and of its partners

Pursuant to Article 175 of the LITL and to article 1 lbis Loi d' Adaptation, a Societe en
Commandite Simple (hereafter "S.C.S") is not deemed to have a separate tax personality
from that of its partner and is hence considered as transparent for tax purposes in
Luxembourg.
An S.C.S is therefore not itself subject to CIT and NWT in Luxembourg, but its partners
are personally subject to tax in respect of their part in the profits/unitary value of the S.C.S,
regardless of whether such profits are efTectively distributed or not.
Given that an SCS is not subject to tax in Luxembourg, it will not be considered as a tax
resident for the purposes of Article 159 of the LITL.
In the case at hand, the partners of Lux S.C.S, i.e. GibCol and GibCo2 will be nonresident, thus their taxation in respect of their part in Lux S.C.S profits is to be detennincd
by following the rules provided in Article 156 of the LITL regarding the taxation of nonresidents.

Absence ofa permanent establishment in Luxembourg - Lux S.C.S' activities

The partners of Lux S.C.S, i.e., GibCo 1 and GibCo2 will not be Luxembourg corporations.
Therefore, Lux S.C.S will not fall within the scope of article 14-4 of the LITL nor of
article 2 of the Municipal Business tax law.
Pursuant to Article 156 (1) (a) of the LITL, the commercial income realised by a nonresident through a permanent establishment located in Luxembourg is treated as
Luxembourg-sourced income, subject to CIT.
According to paragraph 16 of the Luxembourg Adaptation Tax Law, a permanent
establishment is defined as a fixed place of business used with a certain degree of
permanence for the exercise of a commercial or industrial activity in Luxembourg.
In the framework of the Abbott' s group restructuring, GibCol and GibCo2 will contribute
the participations in Abbott Overseas Luxembourg S.a r.l and Abbott Investments
Luxembourg S.a r.l to Lux S.C.S, which in its tum will sell these participations (in a short
time frame) to Abbott International Luxembourg S.a r.l in exchange for shares and a note
payable issued under a MFA.

(15)

Accordingly, Lux S.C.S will hold, for a limited period of time, a participation in Abbott
Overseas Luxembourg S.a r.l and Abbott Investments Luxembourg S.a r.1. This will not
impact the analysis regarding the Luxembourg tax treatment (both for CIT, MBT and
NWT) of the operations of the Lux S.C.S.
Further to the restructuring, Lux S.C.S will have an activity restricted to the mere holding
of Abbott International Luxembourg S.a r.l as well as the management of the MFA.
Lux S.C.S could also hold a current account with a Dutch entity from the group
exclusively for the payment of the operational expenses of Lux S.C.S.
Lux S.C.S will not have any office space, equipment or any other tangible presence in
Luxembourg. It will have no employees.
GibCo I and GibCo2 will not be considered to have a permanent establishment in
Luxembourg for the activities canied out by Lux S.C.S and therefore will not be subject to
CIT, MBT and NWT in Luxembourg. Under the same circumstances, Lux S.C.S. will not
be deemed to exploit an enterprise in Luxembourg, and will therefore not be subject to
MBT.

(16)

Enclosure 5

Articles of association of Abbott Holding Subsidiary (Gibraltar) Limited

Luxembourg S.C.S

( 17)

Enclosure 6
Article 147 LITL
Article 147 LITL provides for a withholding tax exemption m Luxembourg if the
following conditions are met:

The distributing company is:

- A Luxembourg resident collective entity, which is fully taxable and takes one of
the forms listed in the Enclosure to the paragraph I 0 of article 166 LITL;

The entity receiving the dividends is:

- A collective entity falling under article 2 of the amended version of the Council
directive of 23 July 1990 on the common system of taxation applicable in the
case of parent companies and subsidiaries of different Member States
(90/435/EEC, hereafter the "Parent I Subsidiary Directive"); or
- A Luxembourg resident joint-stock company, which is fully taxable and does
not take o ne of the forms listed in the above-mentioned Enclosure; or

- A collective entity that is resident in a State with which Luxembourg has

concluded a double tax treaty and which is fully liable to a tax corresponding to
the Luxembourg corporate income tax, or a domestic permanent establishment
of such an entity; or
- A Swiss resident joint-stock company that is subject to Swiss corporate income
tax without benefiting from any exemption; or

And

At the date on which the income is made available, the beneficiary has been holding or
undertakes to hold, directly, for an unintenupted period of at least 12 months,
a participation of at least 10%, or with an acquisition price of at least EUR 1.2 million in
the share capital of the income debtor. lf the participation is held through a tax-transparent
entity falling under 1 of article 175 LITL, this will be regarded as a direct participation,
proportionally to the interest held in the tax-transparent entity.

(18)

Enclosure 7

Status of the Gibraltar Companies

In the case at hand, it needs to be detennined if from a Luxembourg perspective,
a company incorporated under the law of Gibraltar is to be considered as falling under
Article 2 of the Parent/Subsidiary Directive and therefore if it can benefit from the
participation exemption provided for by Articles 147 and 166 LITL.
Aiticle 227(4) of the treaty establishing the European Economic Community (the "Treaty")
expressly provides that the provisions of the Treaty shall apply to the European territories
for whose external relations a Member State is responsible.
The Government of the United Kingdom is responsible for Gibraltar's external relations.
Thus, the treaty should apply to Gibraltar, as established at the time of the accession of the
5
United Kingdom to the European Economic Community on January 1 \ 1973.
Gibraltar was however expressly excluded from the scope of application of European
Union regulations relating to agricultural matters, value added tax harmonization and
custom union pursuant to article 28 of the accession treaty. No other exclusion was
mentioned. Therefore, all other regulations from the European Union should apply to
Gibraltar.
ln a letter dated January 22, 1999 (a copy of which is also enclosed in this Enclosure 7),
the European Commission confirmed that E-U directives apply to Gibraltar: "I confirm that
Gibraltar, according to the provisions of article 227 paragraph 4 of the EC treaty, is
a European State whose foreign relations are assumed by the United Kingdom.
Accordingly, tax directives 901434, 901435, 691335 and 851303 are applicable to it" .
One could argue that in addition to such confirmation it would be necessary to check
whether Gibraltar companies are refeITcd to under article 2 of the Council Directive
90/435/EEC dated July 23, 1990.
Gibraltar companies are not expressly mentioned in article 2 of the Council Directive
90/435/EEC dated July 23, 1990. However, we understand that they are covered by the
provisions of the Directive, given the confirmation issued by the European Commission
and the following:

Article 2 of the Council Directive 90/435/EEC refers to "companies incorporated

under the laws of United Kingdom";

(19)

The United Kingdom Foreign and Commonwealth Office issued on

November 17, 1988 a letter regarding the status of the Gibraltar companies
vis-a-vis United Kingdom legislation (a copy has been included in this
Enclosure 7). In such letter, it is expressly stated that "nationals'', "nationals of
member states" or "national of member states and overseas countries and
territories" whenever used in the EEC Treaty are to be understood to refer to, inter
alia, British Dependent Territories Citizens who acquire citizenship from
connection with Gibraltar;

The United Kingdom considers companies incorporated under the laws of Gibraltar
as incorporated under the laws of the United Kingdom for the purpose of
article 2(a) of the Council Directive 90/435/EEC; and

The United Kingdom also recognizes that Gibraltar income tax is analogous to its
corporation tax for the purpose of article 2(c) of the Council Directive
1
90/435/EEC

Therefore, GibCo 1 and GibCo2 will be considered as covered by article 2 of the

Council Directive 90/435/EEC dated July 23, 1990.
Please note that pursuant to Article 2(b) of the Council Directive 90/435/EEC,
"company" of a Member State is in particular defined as a company, which "according
to the tax laws of a Member State is considered to be resident in that State for tax
purposes and, under the terms of a double taxation agreement concluded with a third
State, is not considered to be a resident for tax purposes outside the Community".
GibCol and GibCo2 will meet the requirements established in the Directive, since they
will be residents in Gibraltar for tax purposes.
Under the Gibraltar income tax ordonance, a resident company is:
a. a company the management and control of whose business is exercised
from Gibraltar; or
b. a company which carries on business in Gibraltar and the management and
control of which is exercised outside Gibraltar by persons ordinarily
resident within the meaning of the Ordonance.
The Commissioner of CIT will presume that a company incorporated in Gibraltar will
be liable to taxation in Gibraltar unless it is either a tax exempt company or it is shown
that management and control lies outside of Gibraltar (exercised by non Gibraltar
residents), neither of which would be the case in the case at hand. Management and
control is judged in accordance with UK precedent as decided in De Beers
Consolidated v Howe (1906) (i.e. control lies with the head and mind of a company).
1

"EC corporate tax law.

Commentary on the EC Direct Tax Measures and Member States Implementation, 4,

Territorial scope'', International Bureau of Fiscal Documentation, August 2006, page 4.16.

(20)

Therefore, based on the above and to the extent that GibCo 1 and GibCo2 will be tax
residents in Gibraltar, the Council Directive 90/435/EEC will be applicable to these
Gibraltar companies for the pw-pose of Articles 147 and ai1icle 166 of the LITL.

(21)

I
COMMISSION EU ROPi;ENNE

()IRECTION aeM:R>il XXI

FISCALlfE ET UNION OOUAN1R.E

Oruxcllcs, le 22.0 I 191)9

DG XXl/AJ 0(99)100.-S
Vlliup - Dl'../E/981029J/piot

Price WiltcrhouscCoopers
M. Wirn PIOT TJX ;-...hinager
Soc1ctc I\ rC3pomabil1te 1llimitce
Re vise ur d' Entreprises
16 rue Eugene Ruppc..'11
R.P. 1443
L - 1014 LUXEMBOURG

fnitement fiscal de Gibraltar Apparteoaoce

O bjtt

l'Uni11n c uropeenne

Monsiwr,
5ulle .i \<>ttc lcrtrc Ju 16 octobre 1998, Ref. RBSIWPl/SWE.tOL-ttWRR/g1brnl t IJROOI, je
vous confinne que Gibr:tltar est un territoire curopeen ,\we fumes de I' 1rtide 21.7
1 1rJ1,r 1phe i Ju tritte LE J l)nt le Roy1ume-Uni .lSSumc !.:s rel.lt10ns cxtrne urcs. P!lr
1:01Bcqwnt, J,.s dirccllvr.s ti~cJks 1Jl1/l l4, 90/U 5, 119/1J5 :;t l!)i30J y ;ont .lpplicablcs.

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Enclosure 8
Master Facility Agreement

(22)

I>.\TED 28 .\pril 2009

vlASTER FACILlTY AGRILEl\IENT

#..

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'l'lhl.! 1.\: '-d!l.'ldl I!'>('

31JX. ro11tl.' d 'Fs1.h,

f . 1Pl f . llH'mlo111~.
l o1 1111l-D11dn 111" l.1\1.111hm1 ~
I'd.: 1-- J.'! !6 I~ I? I
I 1c t- ~S.! ~6 I~ ll .i.) Ill)

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1 his m.1::.lcr factlity 1grl!l:!tnl.!1'lt is mad..: on 28 .\pril 201)l).

1

UET\vEE:"I:
(l)

A bbott llolding S ubsidiary (Gi b raltar) Limited L11xc111houn~ .c. ., 1

l.'.O!Hp:'.11)' incorporated twder the laws of Luxembourg, h.1ving its r.:!gi~tcrcd
otfo.:e :.ll 73, cote Jt:ich, L-l~SO Luxembourg, GranJ-Dw.:hy of L11x.cmbo11rg, in
process of registration with the Luxcmbomg Trat.le and Companies Register (the
.. Lt.> ndcr"); ;1ml

l2)

\hbott International Luxembourg S.:'1 r. 1., a Cl)mpany incorporalcJ under the

la\VS of Luxembourg, having its registered nflicc at 13-15, .1vcnuc de la Lihcrtt!,
L-1931 Luxembourg. Grand-Duchy of Lu.xl:!rnbourg, in process of 11.!gistration
with the Luxembourg rrndc and Companies Register (the " 13orrowcr").

L3 oth pnrtics arc hcrca11cr collectively referred to as the 'Partic.!i" and individually
to as lh~ Party".

n.:f~rreJ

WHEREAS:
I

,\,

Pursuant to a shar~'sale '-.ig'rceinei1t \~'fit~i:cd: into on 28 ,\pril ~009 by the Lt:nder

md the Borrower (the ''S har e S ale . \ g rccmcnt"), the l.cnd..:r h.1s ~old to the

Borrower 1,.i) J5,7l I ( rhirly-fivc thousand seven hundred ..:lev\!n) "hares with a
111)111inal \..tlue
USO l,000 (unc thousand I nitcd ')tatcs Dol lm) it held in
,\bbolt fnvestmcnls Luxembourg S.<I r.l., t private limited li,tbility comp:rny
r. ,w:)orated under th..: lw.~ nfl t.x..:mbourg, having its registered office .lt 13-15,
'l\\.!!\1tc d..: l.t Lib..:rtl!,, I '91 I I 11.\clllbourg, Gr 1ml-D11t:h)' 1it' Lu ,..:rnbmtP,
,c ;blcr..:d with the Luxcmhotirg l'r 1Ju .1n<l l'o111p,111i..:s R~11,i.,kr imdcr 11uml~r I~
I . l .) l ' md 1,ii) ~H.3"3 (four hundred eighty-tour tho11s.rnd live l111ndrcd fitt)llu t.:<') :llarl.!s with 1 111 rni11,1I value >f I l')IJ 1.000 ( r.c thou Hhl United States
DJil tr'>) it h..:ld in. \bhott <)verse.is f. 11;..;cmh<llll'g S ..\ r.I., l i'livah; l imiti:d li.1bility
c impany i1:c1,1ponlcd 1.ndcr the laws N' l.uxl..'mbourg, h.l\ mg tis r.:gistcr..:J onic..:
it ll-15, 1wn11l!1.dc h I.i b..:rl~, , f.19)1 lu)\...ml,om!?, <lr:u:d-l)uchy 1f
L11x.;1i1buur5, 1..:(.:.1 ~ kt.:d ' \\ ith lhu r,11xcmbou1g I 1 1de a11d t I 'll!':lllil!S R1.~gi-.;1i.:r
1111d,r 1111111..:r n. I 1 l.fi ;() lthc " h:11c-;"

or

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11 ._,..: '\ t 1:.i,
kli1wd h,1111 .. r). hy 1111l\i11j t\ 11111'1.:
h 1 ;J11.;,I I 'l'I
ii...: 'l'..:t:tlk ''II I'll t:'-' ktJ1kd 111 \1 ck I I 11 1 F 1lili1 ... i 111
Ill.; kl lb ,!l ! \.
,ltt' 11-; 1t' 'hi-; \ ,I '- l1 I I
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0.

1'110 Parties expressly :-ign.:c that the ')ale Price shall ')e Jccmi::d to have h!cn
Jr;m n dO\\ll und~r thl! Facility l>y the l3orrO\\C!' on the l-.tTl!ctive lhtc .ind i-; to be
rc1aid ,\ccorJing to the terms anL! conditions ofthi'i .\ grccmcnt.
t
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'

:-,10\V, l'IIEREFORE, in coi1sitlcr:ation of the covl' n:t11ts herei n cout:iincd and

oth er good an<l valuable co nsideration, the receipt and ~u l'lid ency of which a rc
hereby acknowlcd~cd, the Parties hereto agree :ts fo llowis:
.\rticlc l: Defin itions
'.

Unless the cont~xt otherwise rctJuires, in this 1\gret!mcnl:

',\ ccou11ting PcriotJ" mean:> the accounting yl.!ar of the RorrO\\er as <>lated in ihc
.uticks o f Jssociation of the Borrow1.:r, currently I Occt!rnber lo 30 November. By
derogation:
fn r the purpose of this ,\ greemt!nt, the initial ,\1.:cuunting Period will bc~in on
the ''Effective Date" psdcfincd below) and will end on >Jowml>er 30, 2009 (i.e.
the 'Firs t .\cco unting Period").
the last Jay of the last t\ccounting Period to be taken into 11.:c0u11t for the
purpose of this. \ grccmcnt shall b th~ ''\laturity Date" (-1s defined below).
". \ ~rccmcnt"

me.ins this m 1stl:!r faci lity 1grcemc11t as ,uncndcc.I or modilictl from ti1m~

ti> time.

l'

I,

'\~gn: gatc 011t~tandi11g

l'ri11cipa l .\mount" 1JJ1:.1ns. 1l c.!eh rckvant date, the actu,tl

I
:h t lll ling 'Lrgn-,.1tc lll111ll'l' .,r t'1c f) r;twdnwn'\ made hy lh\.' nMrn\\.'r, .1-; l'd klil dl~d
1n the lnilial \ lloc.1lion 'fo>licc t1r in 1h~ l\:r!ndic. \i1<'1:.1tiun i'fotiGc.

",\llo~.1t ion

h.1s he ll\caning ;1vcn lo th1:-. l 11;1 in ,1 r1klc 3. ~

l'ropo~JI"

I)( !(fr,

. \1,1cc1111.:nt.
\~~r

1:c 1; ..,.._, F i11111d:tl

1110,,

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\111111 111! '

1111 1 11

,.., " ~
1:1111t1c1 II .\,s01::. "" il' !...: '.1~rd.1y >t the 1\.:l..:1,, 1:1t
1 .11

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\ H.rt~c F111'l'i : n \ s,ct \ 1111111111" 1 ,. 111' 1;1r ,. t~ll !t ., 1. " i.:1 liP 1r1 d "' I' 11" t'
L 1) ' .111 s It.: 1 .g1\!~1k 111thi.:11) h 1 1c:~11 <\.ir-.ncy ,\ -;I<; 1~ ul 1h..; li:~t I 1; nl 'h
I~" 111l \.:~. u1:i11 ~ l'i.:rwd 1.1d i1 I th~ I 't)rd~n < urr 111:\ \
r- .., .ii 1h.: 'ht ..1:' nt 11.: '-=' 1111 . \1:u>o11:in P ri .i
l lihilll"i'i

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'lll.: ! w 'I' ...,1md.1\.

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lll~.\11ing

"{nitial l'r:111 chc (_' .\111011nf" :1JS the

.-\gre...:111...:nt.

gi\l!I\ to this ICllll in uticlc 1.1 n f this

..

'" \(aturity Date' h.1-; the meaning given to this term in .1rtick 5. 1 ufthi-; \ grccmcnt.
\ (:t.\inm m l'rincip:tl .\mount'' has the meaning gi,en
\ greemcnt.

t0

this term

i11

:utick 2. l of this

"Jct Quali fying Income ., means the rotal net po-;itivc incorm: of the Borrow...:r for the
relcva11l . \ccounting Period
COlllpllLed. lllidcr Luxembourg Gt\,\[> - \.!.\eluding net
incOllh! from Quali fyi ng 'h<ir',t:holdings (i'. J. dividend income, ..:ap ital gain ,\lld write
dm\ns on sharehold ings) ' before deduction oi the l'ra11chc Interest and excluding the
Foreign Currency \ s-;et Income, .1s calcu!atcd in tht: Period ic Allocation Notice. For the
avoidance of dou bt, thl! N...:t Quali l"ying Tm:omc c.rn not be lower than 1ero

as

Other Debts" 111eans the liabilities owed by tht: l3ornw;.:r other th:rn the Aggregate
Outs!.m<l ing Principal i\ m o1111t :i11J thl~ frnnch0 Interest .

..

.. Parties" me1ns 13orrowcr and Lender.

' Periodic Allocatio n Notice" has the mca~ing gh\.!n tu this term in .ut1de 3.2 vf this
1\ gr.::cmcnt.
..
.. .
'~~

'

'

' Qualifying Sharcholdi1ig~ p 1'1i.bl111s the 1~1ia1~~hoH.J.ings held by the 13orrowcr benefi ting
thHn the Luxcmbo11rg panicip.ltion exemption on dividends as defined by \rticlc 161'5
1..1.R.. on capiul .1in-; 1s ,lcfinc<l by the Grand Juc1l dcct\!C of 21 DccLmb1.:r 200 I in
1pplicati1rn 0 \rttclc 166 l .l.R., 111d on net vcalth 1x t.> Jdinc<l by p.1ragr,1ph 60 of
1hc PrtJpcrty .111J S1..cur11cs V,tlu.1l1lln. \d.
,

'

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l{ecl'ipt" 1111 111-.; in rcl.1li1i11 ln' a 1;1.x:. :l'1c. dliy the 1:1.x -.vas :icnt .111d
c "'; ,r,r.:d 1 H~r l\v1) da}; :\ftcr 'the t~tjbl 1;;1-...d kttcr \v,15 p1>stcd.

i11 1\:latio11 tn a

Sending l'.1rt) his th\.! 11:c.111i11;gi'.c11 to this '.cri11 in 11licl-.: >:J \ll this ,\_;1 ..cnh:nt.
'S pc~ilic

Provhio11s"

11.1-> th~

ni..:.111 i11g

giv~n

tn 1his ktm

111

.11!1t.. k

~-~of

this

. \ !1\'0.:llll.:!!lt
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ti1n..: '1y .1 ".til'1,;111q11.;t 'IH bv >n1.: Pl!l)' ti 1 hl.! I! 1~r P ulv pw.. i bl
1t t ,1u ...111 II j.; 11 tdl.! 11) !c 1)lh..:1 11 n t; '" 11:1111 1 ' ( ..;1, nJ l 1y; .,. id. 'I.! {..:\ i .. .,.
111.l I:,. w ;1d,1-..>I 1.; .1 ;n:,:1 ly rile, 1h..:r I' 11ty, I> 11~1ae ,t "..,1dd 1 I.! 11 111'.: ..ith th:
'l'W( fl'" .n...: kwl ,, ..:ontirnwd r.11111'111c 111 timl! hy 1ile I 1:-..:mhiur~ 11.x 111thHttt...:;, 1-i r
\! " I '
r hi.: kl n1in 1 iJll "' Ill..: I \cl ..r ll .: J, h! I 1 I ...i..: II .l tll ..:
11
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I.: ' .i1 .
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f'ram:hc .\ '' is the amount, .:xprcs5ec.J in Ll~D or the ,\ ggrl.!g:.itc Outstanding Princi1ul
\mo1mt .:4ual lo the li.d bo0!.._ \'a!uc of the JSS\!tS anc.J liabilitil!S (other than rnm:hc l3,
l'r ll1Lh~ C JnJ rr,1nchl:! Interest) of the l3orr,O\\l!r, .is recorded in its )tatutory account'>
unda l.11xcmb0urg G,.\ ,\P, cx0luding, (i) 1m thl.! .1.;scts -;idc, th.: net l'l)Ui... vnluc of
<2ual ifying ShJrchold ings not lin:rnccd by . qt h~t Debts (ii) the r ram:ht: L3 Jssl!ls anJ (iii)
'll th..: liabil itks ~idc. thc . \gg1:cg.itc Out:>t,inJ!ng Prin~ ip.1 1 .\mount .111J the Tran..he
Interest. rrnnchc 1\ will l~c allocated to the tinancing or the net book vnluc of the :l:)SCtS
.111J I:.1bi litil.!s, JS spcci lic<l in 1lhe P\!rioc.I ic ..\llocation Notice 1n<l as spl.!ci tied in the
Initial . \ lloc.1tion >Jotkc. r:or avoi<lnncc l)f doubt, the Tr.1nche i\ C3nnot cxcce<l the
\ggrcg.1tc Outst~nding Principal .\ mount.

rraud1c U" is the .unount C'<prcsscd in USO of the .\ ggrcgall.! OulstanJing Principal
,\mount cquiv,1 knt in fo reign currency at the thHc or the foreign currency draw down,
hdu by the BotTO\\'t.!r, :is speci tied in the Periodic Allocation Notice.
'Tranche C" is the remaining amount cxprc:;sed in USO only of the \ggrqate
Outsr:rnc.ling Principal t\tnl1Unts, which is alloc.ne<l to !hi:! financing nf the Qual ifying
Slurd1olc.l ings held by the Borrower, .1s spccificd in the Period ic \ lloc.1tion Notice.
"Tranche i\ Return" mc:ms the result of(,\ ) the >Jet Qualif)ing lncoml.! minus (l3) the
~pread times the ,\\crage Gross Financial ,~ssl.!t Amount Jividcd by lC) the 1\vcrage
(rross finam:ial A~s1.:t .\mount.

:--:1.:1 Qual ifying lncomc ..:.:'tSprcad x :Averagc Gross Fin:rnci,tl Asset \mount)
. \ v'cntg\! Gro-;s Fma~Ciaf . \ssd \mount
!

' ;~ , ' ~

1: '

it ' '

Fur the .1vuidancl.! of Jouol, th~ 'cFJn.chc, \ .R1.dtu'n 1.:annoc be lower 1han 1.cro.
'

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'

" rLlmhc \ l~ctu rn .\mount'' 1111.!:tll'\ th..: l"rand1c A IC.~l'irl\ tim-:;; Ille ,\\..:rai.:~
Fim1whl ,\ ;d :\11H) 1111t, .is c.1k11lntcd in the Periodic \lloc 1ti0n Nutil:c.

"ii ' id ,\ \,
1 .....

l' r111l'l1l'" l{lf11r11 \111111111t"

\111i1 ill, t!i

1k1,l 11cd

rr 11\l he<.
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lnlen ,,
llr 11) 1rr di'

111

\1111111u t ' '

111.!. ln

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r.: I' iwdi...: \llni 1ti)ll 'ld1:cl.!
I

1' lflS

l.1i::. /;~ ) 1 per

i ..: ... (/ ~
!.1~ ni' th..: rd..:\

.111.; t: ( ..

trdii.: I 1111 11111 h of 'hi.: 'i1 -.1

I 11:ch<! (, 1:111 111t ,b l t rl1..: I H .la\. ,,, the .:kv .Jlt
1

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0

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1111

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od.

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.. fra11d1 c

I.u.r(' r~s t'

h;1s the meaning given tu rhis term in .1niclc 6.5 of this

.. l'ram:hc Jntcr c..;t Payment Date" has the rncJning :Jivcn to this tcnn
this ,\grccmcm.
.. frn11d1 c

Intc rc~t

; 11

. \ <~ rccml'nt.

Jrtii.:lc 6 5 of

Period'" means each Accounting Period ut'thc RorTO\\..!r.

~

.\r ticlc 2: Facility

1i..
.

, .

1 '

2.1 r ile Li:ndcr grants the. Ui)t'l'O\\'cr a l\)Jll 1:1cility of up to a prindp:il amount uf USlJ
100.000,000,000 (One lrnmlr~d' billion .Llnitcd States Dollars) lthc ";\faximu m
Principal Amount"). which \~ill be llSl!d by the Borrower for diffcrt!nt t)pcs o f
invcstmcms.
2.2 l'hc Maximum Principal Amounl wi ll be :wtomatically d..:crcascJ by the unount(s)
of the Orawdown(s) anJ increased by the amount(s) of any rcp.1ymcnt ,,r the
Drawclowns.

\rticlc J : .\Jlocation o f the

.\ ~grc~at e O ut sta ndin~

Prin cipal Amo unt

J. I l"he initial 1lh.)calion to the different tranches (rcspcclivdy the " Initial fr :lnc he ,\.
\mount", the " lniti:tl franche 13 Amount" an<l the "Initial rrand1c C .\moun t") 11 f
the .\ggrcgatc Outst.tn<ling Principal Amount on the Effective Date, as well as the value
o f the Gross Financial .\ sscts' 'and of the ,\ ggregatc Outstanding Principal ,\mount on
the Effective Date ire ::-ct ll\lt in !hi..: initia l allocation notice attachcJ as l~x hibit l of the
\grecment ('the Initial .\lloc:1tio11 l\"oticc"). Changes .tr\! p1:1111ittcJ to be maJ\:! to !he
.1lloc.1tion Juring the rckvant .\ ccounting PcrioJ.
\ 2 Thi.: P 1rtic:; f11rthcr .1gr c th:1t thc l31)1'fO\\U' ~i ll \. tai1lish 1t the -:nd 01 e.1ch
\1.:e<Jtmting t>cr i1Hl. 1 tcvi:;cd 1!llh:ati1.111 nutil.:'c. 11pd:ttcJ tccording to rhc tir lll~i.11 ,! tla
1f the rdcvant
\\.1:t 11 1rng 11-:1fod. 111 the: ro1111 of the 11loc.1tion notice .1tt.1chcd .I'>
l::<hihit ~ uf thi..: \~n.:cm~nt (rhc; tcdodic \lloc.1tion 'fotile'').

3.3 l"r:mche ,\, 1"1.11~cilc n. rnnchc c. ,tim-;:1 Fi11:111cial .\SS\!t~ lllHllillt .md ilw
\1!g1..:~atc Oubtandi11..: Prind1nl \ mm111t IS 11f th\! lirst lly c)f lhe ll'li'\ nt \c1011111i11g
!\;rind, tidhl\\ing thl.! rir-.t ,\,,1H111t111~~ P~'ri;id. "ill [i,; rq11 II to !hi.! 1rwd1i: .\. 1rwchc
1. 1 11 1
I t , 1 , I i: m i 1! \ , 1 1 1 .i 1 I I
.1' 1
1 1 Ii .
l ',
' rl \ r
' l \ I
I , .' \ 1 ( I ' J ' ' , \
l ' ' 1' !.
I I t ',,. Hnll' ,, r , d
11d' ..: 11 i die \I 1th 11' 1 111....: !11 hi.: J ..;, ,!.:r , '.
1
1
1,1l <1 .vi11 ~ illl.! re~ 1r.11t..1 .i'' 1h..: 111 d h.1(1 ,r th! nn .1. 1.:1)1111'" l 1r Ii.:
.\..:l.11 .r111n ~ I' 'Ill'-' uv :"< .. ,. q.>,ht-:1\:d ,..;11..:r. 111d 1.1 .111)
hl! ll> l.ik1 t Ii l 11
tJ11hs 'kr t! .,T.'. I Ii \,;1,1'1 tllilH! I' i1 I the \llrH'.lfion ProprJ, ii

")

1.1;. >

\ \ 1111

ti

'\J\.)

l:'rhc I 11 ! r . ., '1\t tify !1 > tr..: l>111u,\ r lri-; lu ..1! 1 l he \: > 111.11' 11 ,' 11
\ithin l 1 ..:".~ 11 \ l.1; 1' 1!!1 1.,iw Iii..: l~...:1:.:i1't 111' 111- \Ike 1ti1'11 Prop,, 11, h \ l1'C 1i1lll
1'r, I' 1! 1-; , 11 .d.:1 d 11,tl1111ttL.tlly t1> I .1 .. ..: i, 11 1cl 11..:d l) 111..: I 11.fi.:r.
0

..

. '

3.6 If the Lcnc.kr sl!nds by n~~tico a counterproposal (the ..Co 1111 tcrproposal' ') recd ved
b:, the Uom.:>\\Cr within 7 (::.even) days follov. ing the Rci...cipt of the .\llot!.ttion Pro po~al,
-;uch Counh:rproposal is considered .nltomatically hJ\ ing been Jcccpkd by the
Borro\\ \!r Jftl!r 7 (iC\ en) days following thc Receipt of the Cnuntcrrroposal, unless the
11orro,.,,cr lus noli lied the Lenc.kr 1>1' his n:rusal of Lhc Countcrpropn.;al.
1.7 In the \!Vt!nl the (\)11nterprnposal is not acce;pted by the norrowcr within 7 (SC\C!1)
d.iys of its Rcc('ipt, the P:-irties shall have rl!Cdursc lo the opinion of an itllkpcndcnt
expert. \Vhosc nomination shall be agreed on by thc PJ.rti1.:s. !'he expert's decision slull,
.:;,we ror 11nmi stakablc error of appn.:datio'n, be Jina! and billding. In the cv1.: nt or no
agreeml!nt on lhl! nominatio\1 of .rn ind1.:p.e nJent cxpat, the saiJ expert sh.111 bt:
nomin:llec.l :-it the request Qf l\1~ niost dilige1\t party by the President of the Tribunal
cl'arrmuliv~"Cmtent de l.uxl!mbo ur~ as soo11 ns..possiblc.
3 ~ As ,,hm 1:; the Allocation Proposal for the rcll.!vant Accounting Period has bcen
agreed by the Parties or sculcJ by the cxpctt according to this article 3 (the " \ llocation
Oatc"), the Partii.:s will <..late, sign .md attach the Periodic Allocation Notiw lo this
Agreement.
3 9 If, further to the Allocation' Datc. it 1.p'pcars to one uf the Pai tics that the \,1h11!s of
1111..~ntiol")t!~' i,1 .. the l\:riodrc Allocation Notice, arc or have become
t:rroneous, in particular because some of the shareho ldings included in the valuation of
the Qualifying S han.:holdings woulJ have ceased to med the conditions of a Qualifying
"lhwcholding, or for ,rny other reason, the relevant party (the Sending Party"') .;h.tl l
then send to the nlher Party a notice of correction of the Periodic Allocation notice,
\CC~)m p micJ 1.)y 111y ,Jocumcntju::;t ilyinJ th\! l:t)fl't!dlOll (lht! Co1-rcctio11 Notice"). rhc
C1m-.:~di1)fl ;-.foticc is ~unsid-: rl!d ~11110111 \tk al.ly 11:.lVing bt:t:n dcccptt:d hy the 1)lh~r P1rtv
it'tcr 7 (,,e\1.11) d t)<; following the Receipt of the C\ im:t:til'll ~tllkc, ttttlcss the llrhcr
P.1tly b:; 11ut1tit!J t h ~ 'l.:nding i>Hly Ill his 1t!l"us.1l ,,r rhc l 'o rr~c l im i\;olit.: '. In u.:h
t:tl'!, 1h..: P:uti.:s .;I t!I have rccrpirsc Id the )cttkmcnt of ,111 c:,pcrt .11.cording to the
pt'< h'l.:dun: dd.tikd un<kr ~~ct i 1i1 J. 1ho~~ : <)1cc,11cccptcJ hy th..: P.ut ic'> or ,..!ltlcJ by
tb.: i11dt:pcndc11t cX('Ctt, the C11m:ctil)n ;'-!1 1i.1.vwill 1nkc clt"cct ind ,1ppl y rd ni.tctivdy lll
llw \ ..:1'01111lillg Pcri1)d it rd.ltcs .. :

,my of the data

: \ I '
I . I
! I 1.111i.1 I i I! .ti \ I 1.. I :. ' I 11 Ill
ti>r ""!l ..:u r ;l'llC~ i111 r e .ir .."' ral installment-; llh: DI' md1m11( , )") luri ~
n: ' ' 11111 1t111 nt P 1'<1.f 1 li1 ..c
t h > 1 ~ 1 ri,\9J.1!11si111. ' I) 1) ~ 11n1)r I>r111 !u1\ 11 '1o'wc ,.f
1
"c l\1 1n \\ r
. 'I

[) 11 1

I ; I 11. h D1 1\\dO'.'vll .h ill lc

11

., ..

'

1cd by 'ht! 1crm-; 111d 1 1tit11 1:, t h1th in 11-;

\ ' ''111vnt 1.. l !h.: P r t \\ ill \\ ll i\;1litc In -.1 1; ,1f '""" i:,.t ~'I\\ .:n ,w 1\i~; 1 n.
~
l ''' <1".r1 ' 11'1.~ I 111.: "pllilk Pr1n j,j"'" ') rnd :111\ '"IC 1'> 1>J 11... \ ' 't!llh.:llt, h..:
1

J \

.!i,til !'l"<:V 111, 1,11J.:1'> thc l.~ nd.:r h l'i 1101i i.: ! 11) rlt(; 13, !l<l '.1:1'
l'l1isi11c <; [),, , !~1 1!. l\'. i ri.: be n:,1 p1 lll'hc !kn.!11\\ll ~ ., j,,.

', 1t.:1it:-:

J' :n1, j,1) l1'

1 1 1.

iih111"1 ' iv1

'11o;

.+.J rhl.! Patties

C:\pn~s:.ly

:igrce th.it on the 121'fcdivc Date, thl! S;!le Prk c has been
dr<mn down and hns decreased the ~laximum Prim:ipal :\muunl.

\rticlc 5: Rt'pay mcnt

'

5.1 l; nk:!>S repaid c.1rlicr i'n ~1ccord.111ce '"ith 'the h!rms uf this Agreement, the B1)rrO\\Cr
~ hall rl!pay th~ Drnwdowris in full plus the unpaid l'r:mchc Interest 1rntstanding nn .. \pril
27, 2029 (the ';\ (aturity Oatc").
5.2 NotwithstJndi118 the foregoing, the Parlks may 1rnvcrthcless .igrcc on the
rdi11ancing of the Drnwdowns,
. :
5.3 Nol\\ithsta11Jing the foregoing, the l3orrowcr shall be entitled to 111.1!-.e earlier
paymencs, without bonus or penalty, to reduce or repay the Dnwdowns in \\hole or in
p::\11.

5. i .\ll sums payabh! by the [forrowcr hereunder, whether vf principal llr interest 1) r
01hcrwisc, shall bl! paid in full clear of and without any deduction for or on Jccount or
.my l'l'Cscnt or future income or other taxes, levies, imposts, duties or other t.:hargcs
\\helbi.JC VCI'.

5.5 fhc 13orrowcr hereby :-Lgrccs to indemnify the Lender 1g,1inst 1ny t:ix, levy, impo'it,
Juty Ol' O'.her charges (other than 011 the l cm.Ids ovcnll 111.!t income) \vhich may be
..isscsscd 1gainst the Lender or cfaimc~ o~: d~mJnJcd from th~ Ll.!nJcr in n.:spcct of the.!
l)rawdowns an<l/or its rcp:\yhic11i' .ltld against :my costs, chnrgcs, cxpcns\!s or liability
.1risin!.!
out of or in n!!!pcct of sut.:hl 1sscssmcnt, d airn or J\.!mand.
~
]\

\rticle 6: l'ranchc lutcrc-;t

Ci. I

,\

1'111.! T1.u1che

I\

ill -:.irry

lhl.!

l'ra11chc \ Rctt ll n . \mounl.

I

1l'i

.!..:tined

lit

:hi"

l')

ddin..:,t

Ill

th i'i

t'i

!..:!ind

! il

thi1

. \ :;rct1111.:nt.
)

I he I

B 1 vill

1.111d1\!

1rrv 1hc Ti rnchc 13

l~..:t1 : rn

\ 1l11 >Llnt,

.. .

\ i.:recmcnt.

6.J. I !:c l'rnnche <' \"il l c.11r:1 th: frmi.:hc C lntc:c:;t .\meui:t,
\ ~rccmcll l.
I' !

11-., '

'I' ,

" . II'. \\, h n1:vt'l' rPopri

,, lit ll 1:1)'.; I 1pc: d

t!C

)1

11,

1
.._'

!''.

lhc intr.:r..:, t dMl l I'.) ..1.1 11 p 1t d lll 1 !'I'll

1

} ,

'tt.1

J ,

"'

1 1~i; t rh

t I\! r,.1~:.~ \ l{ ,!111 11 \1111>1 !!1!. I le I 1 111l'!1e I ~ 'tll ll \ ~ 1,,11

11d lhi.! 1'1111ch..' I ' l11t1:1'"' l \rnr" 111l. ( 1hi.: rra11 d 1c f11t1.n,t" ) 1111 th.: l' I.,:\ 1111
\ C1.. \Ii l l l ll ..! I'.; r' ) l .. " I I ..: I\ l y I hJ..; \\ 1'rhi11: l 0 I I 'I I ) I I11 ...; 11 'l r ) l \ I ) l . \ 1. l I I i' 11 I) l'

:),'\ !'.le

1i.;;,;r .:1tc

,{

1'1" 1111 he lnlC' l l' -.1 Pa \ 11Jl'111I)1tc ')

11>

1:-.~

Ii!! 111 ' en11.,111> :' 1l1..; 11 11 Li...:,., 1lt.1t, to th!.! ..;,\ri:1111 !11l 1 1..: 1l1Jl l\>". ..:r Ii" nu! 1:p1.11
li'1nll..; l11ler-st \' irl 1 i11 ..:\<.:ll) l 11 o; 1;,q, \\111~ 1!,.;: 1 ,! 1..: ltt1-.1>,, , , .. ,u 11 ,1,

IL

1-;

and unk:-.s otherwise aurccd between th\! J>.'.\rties, the L..::ndcr shall consitkr rllJt the
13ur:v'.\Cr l'as m. 1dc an .1ddition:-tl Oraw~!o'' n on the l'r::uchc Imerest P11ment O;Hl! for
the .unount o f the unp.1id l'rand10 Interest.
\rticlc

1 :

Cove nan ts

lh~ Borrower cu\ cn:.u:ts so fl)ng <lS any :.um rt:n1nins pa) able under this :\gr..::(;mcm. 1h.1t
the Uorrowcr:
: .
.\: . J , ~.

!
( ,1)

I 'I'.'';~

1\ I

ii '

will promp,cly_qcl,' i?e the Lender in \'vriting upon becoming .m.m! of:
any Event of Default or any event or Lircum!>lance wllich may
become an E\cnl of Default; .ind
any m.1lcrial adverse facto r v.hich may inhibit the Borrower in rhc
performance of its oblig.ltions unJcr this ,\ grccmc nt;

( b)

wi II supply the Lender forthwi th on demand \"vith such financi.il

document.1tion JS may he rcquc::.tcd by the Lcnd\!r from time lo time.

\diclc 8: Event of Default .

\ I.. 1.

~-

\.. \

..

It I

lo.

tr al any ti me and

for any re:.isbn; ~vhdhcr

tny of the t'vllowi ng events occurs:

\.'i hhin
1

or be) ond thc control of the llorrower,

(.1)

the 13om.nvcr is declared insolvcnt, ba11knrpt or suspends its p.1ymcnts nr

ntcrs into a composition agr(;1.:111cnl; or

1b)

.my 1sscts of .the Horrower ilrc attached by .i 1.:rcdi tor; 11r

. ..

I ~)

1 '11~

l!Ofl'll\\:li:I" 'lOCS, into Jiq11id.1tinn OJ'

l )

lhc

ll11n O\\CI' <..e.1scs

i ~;

to p 1y its ,f..!lm )r

ifi ,..;o l ved ; nr

h:comc~ t111 l:lll!

to p ty :b ,f.:bt ;;

tl l'

. t

~ 1

, , 1111

ir , 11'1"

I'

,,.,

.i.h (,r

' l l':

.n d'I 111 , r' :

,I .

I.

1 ,

,..
f

,'

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. I ..:r li t) 1.;t .:r.:111.:11!; or

t: 'lf

L h 111:.:c 11. my 11,pli ... 1'' : I 1

11 11111 ' I' 11
1
1i t.:r >:"ut lll n
i... 1 ,if. ''r 11\'r 1)\1..'llllllCllt 11 r 1..:r ,.i!.1:1
11th11ri1:/ .:h.11~t:d' \\ith 'le . 1 l11:.i11i.,111tio11 h. 1cn r' H' mv :c111 t 11 !
1 11r..: 11t p1:1s 11 ... 1 11. \l11d1 I' 1!.:.~ i t 111.11\ f1l 1;.r 1c I .1...r H '1.:
!. 1r J '..:r 11) i,,. l~~ ,: t '1.,r111 1i11' 11n 1h... 1r 1c J..:!lll\1.'
,.; i.il 1h 1 i11d r
hi".\ {IC-:!lh!lll ;

I:
he

tt''rc fl1cti, 11

then, 'IL any tim..: (whcth~r' :or nt~~ .111y ~;1..:i{'cvcnt i~ cnntinuing) the I ender 1~11y, by
\Hillen notke lv the f30rr~ 1.wr.' Jed.m; the' Dra\\'JO\\ n1 ::.) .111J all uthcr 'ums payJble
under this ,\grc~mcnt to be i111;ncJiatdy Jue JnJ pJ) .1ble, ''hereupon the ~lme ->hal I
imml.'di:ncly be1:u1111.: du1.: 1nd payabl1.: anJ no amounts <.h:tl! suoscqucntly l'c a\ :-ii lable
fo r Jraw hcrcunJl.!r.
\rticlc ? : Fu ll r cco ur-;c

,\II .1mou11ts and

oblig:u i~ns. ,vhkh

:ire to be paid or pa!ormed .mJ satistkJ by the

be Jue .md

H11rrO\\ 0r to th~ f \!ndl.!r under and pursu:mt to this :\greemcnt shall

rcco' crable by Lill.! Lcnckr on all and cwry assets owncJ by the 13orro,,l.!r.

,\rticlc 10:

.\.~sigumcnt

10.1 l'he Dorro,vcr mJy not as::.ign, tnnsfcr or othcr\'., ise Jisposc uf ,111 or part of .ts
rights or obligations under this Agreement unless 1pproved in writing by the Lender in
it.;; sole discretion.

l 0.2 The Lt:mh.:r may assign all its rights under this Agrcumt:nt in accorJance with the
provisions of. \1lkh! 1690 vf the Luxl.!mboilf'g Ci\ ii code.

. . i) ,' I
:
I
Wa !':c~11, ,. \m c1~tlmc1\ts. :uu1
I

.\rticlc 11: Remedies,

Consents

l l. I No failure on the part o/ the c~!1dc1! tq 'exercise, and no dday on its part in
.my right ur rl.!medy under this Agreement will operate 'IS a waiver thereof,
nor will any ~inglc 1)l' partial 1.:xcrcisc of 'my right or rcmcJy preclude 111y 1)lhcr >r
f11twc exercise thl.!rcof 1)r the c crcisc of .111y other ri ht 1ir remedy. 'I h; rights rn<l
remedies provided i.1 this ,\ grccmt:nt .ire cumulative lllU nut exclusive (I[" my tights ur
rcmcdil.!s pro\ided by law or n1]\c1wi'ic.
0

cxcrci~ing,

I",'.\' .J

I'

I"' : ,

11 ~ 1\ny prnvi">h'n nt' rh ii ,\gn:crncnt may be arncnd1.:1 l but 110 11nc11dm nt h.dl hl.!
the P:u tics nnkss .ind unti l it shall have bi.:cn n.~1..,1\kd in writing ,i jncd by

bi1:di11~ in

"nth P ,, t:..:s.
.\rtidc I !: i'ioticc'I
I~. l

:\ny

1 '1i ~
~

1.:111 ... d:1

1

other rnm111u1111.'.1ti)n rc4u1rl.'. d l)ti pcrn11ttl!d o l) l.! 4ivl!n hcrcu11dc1

.1:1d ,l ..111 \.; 1 Ii' I 111 I'' r "" 11111 11 .1.. I:-., ,, ..,imil ' r ,,i111if ir
I I....
~
I. 1
I . i
11
o,;,J I~ llt ',

1llitke lll'

l' ii!,,, in

\b 1ot ;1old111g 'ul -;1.J1 u, (lli"r.1ltari l.11.1 1,;d I ,;,~1.d''i11, ~ l "

'1 t[,l l"dl
I I I )C) I .' ..,,10. :
1 ''

11,J.fJud.y l r I

\ k11li 1 11:

111111111J

(ii)

in the c:isc of th.~ Oorrov.. cr:

Abbott lnternali9n,al f~.uxcmbourg S.~1 r.I.
l 3-15, ,1vcnuc Jc la Libc rte
L-193 I Luxembourg
G rnnd-Duchy 0f Luxcmbourg
\ttcntion:

the manager.s

12.2 Any ')Uch nL)ticc or oth0icommu.i1i,<.:atioi1 ~hull be deemed to have been given and
received on the day on \Vhich it was deli vered or transmitted if so dclivcn.:d or
transmitted prior to 6:00 p.m. 'local ti me at the place of receipt (or, if' such day is nut a
T3usi11css Day or such communication is Jeli vere<l or transmitted after 6:00 p.m. local
time at the place of rcccipt, on the next fo llo\ving l3usincss Day) or, if mailed, on th~
firth 13usincss Day following the dnte of mailing.
12.3 i\ny Pnrty may at :iny ti me change its address for service from time to time by
giving 110ticc to the othl.!r Party in accordance with this artick.
Article 1J: Governing Law aud ..Jul'isdic:tio n
;

t 1,.'

t ~I

'

:'

'

l 3.1 l'his Agreement ts govc;rocJ by ' a1\<l. .:;hull be c.:onslrue<l in accordance vvith
Luxembourg laws.
,'1,
I

13 1 Each r 1rty hl.!n..by in!cvdc~bly ,rn~!' uncondition.:ll!y -;ubmits tll the jurisdiction of
the district of Luxembourg in t:~spect of all matkrs irising out or 1>r in cu1111cction with
this, \::;1\!C1th:nl 1"1r the.: tr:l!lsactions c.:ontcrnpL1tcJ hcr-:by .
. \rt idc l i: Co 1rnlcrpart~

l :iis ,\~1\:cmcnt may he Jx~~Sl\!.ll'in ~nf'1i1lihbcr ol' c:lll!llkrp:ith ca<:h nl' 1\hid1 vlt1,;11
..,l)':.dr lie m ;)rig!n'.1!, b11t t!I 1he (<htnterpa1h toi;..:thcr -;ll \ll
1.:>nslitute ,ine .md the ,,u)i.:: instrument.
.;.\..:1.:11kd ind d.:!ivl.!n:d

IN WITNESS WHEREOF the Parties have executed this Agreement in two originals.
Each Pruty acknowledging having received one original.

Abbott Holding Subsidiary (Gibrnlt11r Limited Luxembourg S.C.S.

Name: Thomas C. Freymnn

Tith:: Manager

Abbott International Luxembourg S.A r.I.

Name: Tnra R. Kaesebier

Ti tic: MllllJlger

'!

., l

. ~ .

f:'J W[TNl-SS '.VHEl\EOF the Partks have cxc(;utctl thi:i

Agn~ml!nt i11 l\\O l.lri gin.il~.

F:id1 P1rty 11:knnw !cd~ing l;avinJ r.!ccivcd enc ori~mal.

~~~~~~~~~~--~~~~~~~~~~~~~~

.\.bhott Holding Subsidiary (Gibraltar) Lim ited

'Jam~:

Thomas C. Freyman

ritlc: l\larugl.!r

I
. . _~J Clt c'

I /

.)

e-1.e0_a..{,.Lu,,,

\llbott [ntcrnational Luxcmhourg

Name: Tarn. R. K.ie~;ebicr

l'itlc: ~ lun.iger

S.a r.I.

Luxemhouq~ ~.c.:;.

Initial .\!location 'l'otice

~---- ________l_
11_it_i:_
1l_A lloca t!o!!._N_o_t ice

r.: ffcct ivc Date

\mount

Gross Financial ,\ ssds on the Effoctive

t;so o.oo

foreign Currcm:y 1\sscts on the F:ITcctivc

Date

l.; SD 0.00

\ ggrcgatc Outstanding Principal Amount

on the Effective Date

USD l8,659,.i98,36J

I Date

The Initial franche A :\mount

I he Initial l'rrnchc 11 .\mount

.,

ti

----1---Ir

1l:t.! Initial 1':1111.:ho.! C .\mounl

t JSO 0.00

- -

--

r rso 0.00

, J

i'

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' ,.
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1 ,)(
l..C,
,' ,.J

! ~ ~J
f

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I' J.,\---- ---,\ hlwtt I ntc rna linn.ll l.u\crnhou n: S.:'1 r.1.
.!I

(i'-' I, ;" ,_

N:1111e:

rillc:

~ .....

r u.1 ll. K .lC~Cllicr

\ l 111,1cr

,\!)hott !l oldi111~ Suh~i 1 lio1ry (Gibr:iltar) U111i1c:1I Ltt"\l.!11\houq!, S.C.S.

Name:

!"hl)lllilS

T i lle:

~ !.rn.1g1:r

C.

Fr~yman

r:'

"

.\.

I: I

Abbott !nternntionnl Luxembourg S.u r.1.

Nnml!: Tarn R. Kncsebier

Mannger

Title:

Abl.Jott Hol<ling Subsl<Jlnry (Glbniltnr) Limitctl Luxembourg S.C.S.

Nome: Thomas C. Freyman
Title: Manng~r

: I

'J

.' .
~

Y \ !. l:t,

'11 ',,:r\

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Plriodic ,\ !locatio n ~>tire

.a

.\l>hott ( ntcrn arional L u xem bou rg

r.I.
' ocictc r csp o nsahilitc lim itce
R egis te re d office: 13-15, avenue d e la Libertc, L-l!JJ l Luxembo urg,
C~:111u- 011c hy of Luxcmhou rg
S ubscr ibed Cf1pita l: USO J0,000
R.C.S. Luxembourg 13: in p rocess of r egistratio n

(the ~co mpan y")

Abbott Hol1li11g Subsidiary (Cibmlt:u )

Limited Luxembo urg S.C.S.

73, cOtc ti' [ ich

L-1 ~50 Lu'(cmhourg,
G raml-Ouchy of Luxembourg
~ : I.'_'

~ \ l 1 >\.': t ~

II

1 I_

rl

<onccrns: l'criotlic \lloc;1tio11 Notice fo r the .\ccoun t ing Period ended on 1... j,
[ ... j, W( ... I

I )..:11

~tr,

\\t: 1cli.'r to 1r'idc ~

t:1lili1y .1 r "~Ill .Jucd \pril :~. 11)1) wd 111.:1!..:

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the ,\cc~tmtin_g1 Period
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Aggregate OutstanJ111g Prrnctpal ..\mount on
1he first day of the , \c.:01111ting PcrioJ

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Enclosure 9

Tax treatment of the Master Facility Agreement

A

Description of the MFA

A MFA is a multi-purpose facility agreement under which funds are made available in
different tranches depending on the purpose for which the funds will be used. As far as the
MFA between Luxembourg SCS and Abbott International Luxembourg S.a.r.l is
concerned:

"Tranche A" will finance in priority the assets of Abbott International Luxembourg
S.kl (borrower in the MFA) other than (i) the shareholdings eligible for the
Luxembourg participation exemption (ii) the assets (loan receivables ) denominated
in a currency other than USD and which arc financed by Tranche B, corresponding
mainly to the USD intra group receivables; and

"Tranche B" will finance the assets (loan receivables ) denominated in a currency
other than USD,

"Tranche C" will finance the shareholdings qualifying for the Luxembourg
participation exemption held by Abbott International Luxembourg S.a.r.l as defined
in article 166 LITL and the Grand-Ducal Decree of 21 December 2001 in execution
to Article 166 of the LITL.

Since Abbott International Luxembourg S.ar.l will be deemed to be in a financial onlending activity with respect to Tranche A assets and Tranche B assets, it should derive a
net remuneration from these transactions. This net remuneration will reduce the interest
paid to Lux S.C.S under the MFA.
The Tranche C of the MFA will bear an arm' s length fixed interest rate of 7, 6573%
calculated on the principal average amount allocated to this tranche.

Financial on-lending activity

As mentioned above, further to the restructuring, Abbott International Luxembourg S.ar.1

will be deemed to be in a financial on-lending activity.
Depending on the amounts of Tranche A and B of the MF A and taking into account the
features and conditions of the Tranche A and B of the MFA, we will revert to you in order
to detennine the appropriate and acceptable profit with respect to Articles 56 of the LITL
and 164 (3) of the LITL (after deduction of all the charges incurred by Abbott International
Luxembourg S.kl) to be earned by Abbott International Luxembourg S.ar.l..

(23)

Should the total amount of Tranche A and B for the first year exceed EUR 1,250 Mio, an
acceptable level of taxable spread will be 0,03125% of the sum of the Average Gross
Financial Asset Amount and the Average Foreign Asset Amount.
The acceptable level of the spread may be reviewed if the principal amounts of the loans
and receivables involved in the financial on-lending activity transactions vary significantly
(i.e., if the principal amount of the loans and receivables increase significantly, the spread
could decrease, conversely if the principal amounts of the loans and receivable in the
financial on-lending activity decrease significantly, the spread could increase).

(24)

Enclosure 10

Tax treatment of the potential reimbursement of share capital of Abbott

Investments Luxembourg S.a r.l
A.

At the level of Abbott Investments Luxembourg S.a r.l

At a later stage, Abbott Investments Luxembourg S.a r.l may redeem part of the
outstanding shares held by Abbott International Luxembourg S.a r.I in exchange for (C)
PECs or PECs.
Article 97 (I) of the Luxembourg Income Tax Law ("LITL") states that all dividends,
profit sharings and other allocations granted under whatever form, in respect of shares,
profit shares or other participations of whatever nature in collective entities as mentioned
in articles 159 and 160 LITL, are considered income from capital. Article 146 ( 1), l 0 LITL
refers (among others) to article 97 (1), I 0 LITL in order to determine the income that is
subject to withholding tax in Luxembourg.
Article 97, (3) b) LITL provides for an exception to article 97 (1) LITL in stating that the
proceeds allocated at the occasion of the reduction of the share capital (the reimbursement
of share premium being assimilated to a reduction of share capital) and corresponding to
contributions of the shareholders are not deemed to constitute income from movable
property. Such reimbursement of share capital would however be taxable up to the amount
of retained earnings incorporated into the share capital, as such retained earnings would be
deemed distributed first. Furthermore, the reduction of share capital will also be taxable if
it is not motivated by serious economical reasons. According to the Administrative
Practice Note, if a company disposes of retained earnings that it does not want to distribute
to the shareholders, the reimbursement of share capital is not motivated by serious
economical reasons. Legitimate economic reasons may also not be available in case the
reimbursement of the share capital would remain outstanding.
Accordingly, if undertaken, this reduction of share capital will not be subject to
withholding tax in Luxembourg provided that Abbott Investments Luxembourg S.a r.I will
not have any retained earnings at the beginning of the current financial year in which the
reduction of share capital will be held. In the contrary case, such reimbursement of share
capital will be re-qualified as a dividend distribution (up to the amount of retained earnings
incorporated into the share capital of Abbott Investments Luxembourg S.a r.1) and should
in principle be subject to a 15% withholding tax pursuant to article 146 LITL.
However, such a dividend distribution will not be subject to any Luxembourg withholding
tax provided that Abbott International Luxembourg S.a r.I will comply with the minimum
threshold and holding period requirement provided by article 147 LITL (please refer to
Enclosure 6).

(25)

B.

At the level of Abbott International Luxembourg S.a r.l

According to article 10 LITL, "Are only being considered for the detc1mination of the total
net income [ ... ] :

1. Commercial profits,
2. Agricultural and forestry profits,
3. Profits from the exercise of a liberal profession,
( .. .)
6. Net income deriving from movable property,
( ...)
8. Other net income specified under article 99 LITL"

The listing of article 10 LITL is restrictive. The profits and income not affected by n I to 8
[of the above list] benefit from a so-called "material" exemption.

In the event the movable property would be part of the net assets invested in an enterprise
or an exploitation as assets invested by destination (notwendiges Betriebsvennogung) or
by option (gewillkiirtes Betriebsvennogung), the related income would be taxable as
commercial profit, agricultural and forestry profit or profit from a liberal profession. The
subsidiary character of article 97 LITL in comparison with the three first categories of
revenue listed in article 10 LITL finds its legal foundation in article 97 (4) LITL.
According to the preparatory works to the Luxembourg Income Tax Law (commentaries to
the proposed article 114 (now article 97 LITL)), the income derived from one of the three
first categories of revenue as listed under article 10 LITL is subject to its respective own
rules for the determination of profit. This principle is also laid down :in a1ticle 97 (4) LITL
which states that insofar an income referred to in this article is included in the commercial
profit, in the agricultural and forestry profit or in the profit from a liberal profession,
according to the provisions governing the determination of the said profit, it shall be
taxable in the related net income category.

In the case at hand, taking into consideration the nature of the activities to be performed by
Abbott International Luxembourg S.a r.1 and the fact that "the movable property" will be
part of the net assets invested of Abbott International Luxembourg S .. r.l, movable income
to be received by Abbott International Luxembourg S.a r.l will be considered as
commercial profits as envisaged by article 14 LITL and will be taxed as such.

Consequently, the general principle of article 40 LITL ("theorie de l 'accrochement du

bilan fiscal au bilan comptable ' ) will apply. Therefore, the tax treatment of an
operation/item involving income covered by article 97 LITL will follow the applicable
accounting treatment of this operation/item.

(26)

Abbott International Luxembourg S.a r.1 will record in its statutory accounts, further to the
reimbursement of share capital (the reimbursement of share premium being assimilated to
a reduction of share capital) from Abbott Investments Luxembourg S.a r.1, a decrease of
the acquisition costs of its shareholding in Abbott Investments Luxembourg S.a r.1 and a
corresponding increase of assets (e.i., receivable). This transaction will not have any
impact on the profit/loss account and will not result in the realization of any profit.
Consequently, this reimbursement of share capital will not trigger any impact from
a Luxembourg tax perspective.
In the case retained earnings would have been incorporated into the share capital of Abbott
Investments Luxembourg S.a r.l, such reimbursement of share capital will be re-qualified
as a dividend distribution (up to the amount of retained earnings incorporated into the share
capital of Abbott Investments Luxembourg S.a r.I).
Accordingly, Abbott International Luxembourg S.a r.l will benefit from the Luxembourg
participation exemption regime in Luxembourg for its qualifying participations in Abbott
Investments Luxembourg S.a r.I with respect to dividends derived in relation to its
qualifying participation, provided that the conditions of Atticle 166 of the LITL are
fulfilled.

Please refer to Enclosure 11 for further details in this respect.

(27)

Enclosure 11
Luxembourg participation exemption regime
A.

Dividend income

Article I 66 of the LITL provides for the exemption of the dividends

conditions are fulfilled:The distributing company is:

if the following

- A collective entity falling under article 2 of the amended version of the Council
directive of 23 July 1990 on the common system of taxation applicable in the
case of parent companies and subsidiaries of different Member States
(90/435/EEC); or

- A Luxembourg resident capital company, which is fully taxable and does not
take one of the forms listed in the Enclosure to the paragraph 10 of article
166 of the LITL; or
- A non-resident capital company that is fully liable in its state of residence to a
tax corresponding to the Luxembourg corporate income tax. Regarding this
condition, the Luxembourg tax authorities have set the rule that the foreign tax
must be assessed at a minimum rate of I 0,5% on a taxable basis detennined
similarly to the Luxembourg one;
and

The beneficiary company is:

- A Luxembourg resident collective entity, which is fully taxable and takes one
of the forms listed in the Enclosure to the paragraph 10 of article 166 of the
LITL; or
- A Luxembourg resident capital company, which is fully taxable and does not
take one of the forms listed in the above-mentioned Enclosure; or
- A domestic permanent establishment of a collective entity falling under article
2 of the amended version of the Council directive of 23 July 1990 on the
common system of taxation applicable in the case of parent companies and
subsidiaries of different Member States (90/435/EEC); or
- A domestic permanent establishment of a capital company that is resident in a
State with which Luxembourg has concluded a double tax treaty;
- A domestic permanent establishment of a capital compan y or of a cooperative
company which is resident in a Eu ropean Economic Area (EEA) Member State
other than a EU Member State.

(28)

And
- At the date on which the income is made available, the beneficiary held or
undertakes to hold, directly, for an uninterrupted period of at least 12 months a
participation in the share capital of the subsidiary of at least l 0% or with an
acquisition price of at least EUR 1.2 million. If the participation is held through
a Luxembourg tax-transparent entity, this will be regarded as direct
participation proportionally to the interest held by the Luxembourg holding
company in the tax-transparent entity.

A further benefit of the system by comparison with the one applicable in other
countries is the ability to deduct related expenses (e.g., interest charges incurred in
financing the shares). Nevertheless, expenses incurred during the year in whjch a
dividend is received and which are connected to the exempt participation may only be
deducted insofar as they exceed the exempt dividend for the year in question.
Additionally, if a write-down in the value of the participation has been booked as a
consequence of the distribution of dividends, this write-down will not be deductible up
to the amount of the exempt dividend.

B.

Capital gains
The Grand-Ducal decree of21December2001 for the application of Article 166 of the
LITL provides that capital gains realized from the disposal of shareholdings are tax
exempt if:
The subsidiary is:
- A collective entity falling under article 2 of the amended version of the Council
directive of 23 July 1990 on the common system of taxation applicable in the case of
parent companies and subsidiaries of different Member States (90/435/EEC); or
- A Luxembourg resident capital company, which is fully taxable and does not take
one of the forms listed in the Enclosure to the paragraph l 0 of article 166 of the
LITL; or
- A non-resident capital company that is full y liable in its state of residence to a tax
corresponding to the Luxembourg corporate income tax. Regarding this condition,
the Luxembourg tax authorities have set the rule that the foreign tax must be assessed
at a minimum rate of I 0,5% on a taxable basis deterrruned similarly to the
Luxembourg one;
The beneficiary company is:
- A Luxembourg resident collective entity, which is fully taxable and takes one of the
forms listed in the Enclosure to the paragraph 10 of article 166 of the LITL; or

(29)

- A Luxembourg resident capital company, which is fully taxable and does not take
one of the forms listed in the above-mentioned Enclosure; or
- A domestic permanent establishment of a collective entity falling under article 2 of
the amended version of the Council directive of 23 July 1990 on the common system
of taxation applicable in the case of parent companies and subsidiaries of different
Member States (90/435/EEC); or
- A domestic permanent establislunent of a capital company that is resident in a State
with which Luxembourg has concluded a double tax treaty;
A domestic permanent establishment of a capital company or of a cooperative
company which is resident in a European Economic Area (BEA) Member State other
than a EU Member State.
And

- At the date on which the alienation takes place, the beneficiary has held or
undertakes to hold the respective participation for an uninterrupted period of at least
12 months, and during this period the participation held does not fall below 10% or
an acquisition price of less than EUR 6 million. If the shares are held through a
Luxembourg tax-transparent entity, this requirement must be fulfilled not by the tax
transparent entity itself, but by the beneficiary, proportional to the interest held by
the latter in the tax-transparent entity.

A recapture system exists, under which the exempt amount of the gain is reduced by
the algebraic sum of income (mainly derived from the participation and potential writedowns in the value of the participation), to the extent that they have reduced the taxable
base of that year or previous years. Basically, an effect of this rule is that the capital
gain realized will become taxable up to the amount of the aggregate expenses and
write-downs deducted during the respective and previous years in relation to the
participation.
The purpose of the system is to avoid the taxation vacuum, which could result if the
deductibility of expenses and write-downs connected to the participation was allowed
whereas the income arising from the participation was tax exempt.

(30)