\n 10.5 Dispute Resolution…………………………………………………..37<\/p>\n 10.6 Limitation of Liability………………………………………………37<\/p>\n
10.7 Bulk Sales Laws……………………………………………………..37<\/p>\n
10.8 Provisions in Ancillary Agreements to Govern……………………………38<\/p>\n
10.9 Miscellaneous……………………………………………………….38
\n<\/c><\/s><\/table>\n
iv<\/p>\n
ASSET PURCHASE AGREEMENT<\/p>\n
This Asset Purchase Agreement (this “Agreement”), made as of August 6,
\n2001, between Motorola, Inc. (“Seller”), a Delaware corporation, and General
\nDynamics Corporation (“Buyer”), a Delaware corporation.<\/p>\n
WITNESSETH:<\/p>\n
WHEREAS, Seller, designs, develops, manufactures, produces, provides,
\nintegrates and sells secure communication and information products, systems and
\nservices, including integrated command, control, communication, computer,
\nintelligence, surveillance, and reconnaissance systems; software-defined radio
\nsystems; high-assurance security and encryption products and services;
\nintegrated communications systems; and specialized restricted space payloads,
\nfor government and military enterprises in domestic and international markets
\nthrough its Integrated Information Systems Group (the “Group”); and<\/p>\n
WHEREAS, Buyer desires to acquire substantially all of the assets,
\nbusiness and operations of the Group and is willing to assume certain specified
\nliabilities of the Group, and Seller is willing to convey and assign the same
\nall on the terms and conditions hereinafter set forth.<\/p>\n
NOW THEREFORE, in consideration of the premises and the mutual
\nrepresentations, warranties, covenants and agreements set forth below, the
\nparties agree with legal and binding effect as follows:<\/p>\n
DEFINITIONS<\/p>\n
As used in this Agreement, capitalized terms shall have the meanings set
\nforth or referenced in Exhibit A or elsewhere herein.<\/p>\n
ARTICLE I<\/p>\n
PURCHASE AND SALE OF ASSETS; ASSUMPTION OF LIABILITIES<\/p>\n
1.1 Acquired Assets. Upon the terms and subject to the conditions of
\nthis Agreement, Seller hereby agrees to sell, assign (but only to the extent
\nassignable), transfer, convey and deliver (or, where applicable, will cause its
\nAffiliates to sell, assign (but only to the extent assignable), transfer, convey
\nand deliver) to Buyer, and Buyer hereby agrees to purchase, acquire and accept
\nfrom Seller or Seller’s Affiliates on the Closing Date the assets, properties,
\nrights, contracts and claims of Seller or its Affiliates used or held for use
\nexclusively in the business and operation of the Group or otherwise listed or
\ndescribed in clauses (a) through (o) below (but not the Excluded Assets), free
\nand clear of all Liens, except for Permitted Liens (collectively, the “Acquired
\nAssets”):<\/p>\n
(a) Contracts. Except as set forth on Schedule 1.2(n), all
\ncontracts, subcontracts, bailment and teaming agreements or arrangements, joint
\nventure agreements, basic ordering agreements, multiple award schedule
\ncontracts, pricing agreements, letter contracts, <\/p>\n
purchase or delivery orders, change orders, non-disclosure agreements, other
\ncontractual agreements, “other transactions” with the United States Government,
\nand all other contracts, agreements, commitments, leases and licenses to which
\nSeller or any of its Affiliates is a party entered into by or through the Group
\nor any of its divisions or which is listed in the Group’s contracts database,
\nthe Group’s Eclipse database for radio and secure products or the Group’s Oracle
\ndatabase for test equipment (collectively, the “Contracts”), including without
\nlimitation (i) the Government Contracts and (ii) the Material Contracts;<\/p>\n
(b) Personal Property Leases and Software Licenses. Except as
\nset forth on Schedule 1.2(n), (i) all leases with respect to Tangible Personal
\nProperty to which Seller or any of its Affiliates is a party entered into by or
\nthrough the Group or any of its divisions or which is listed in the Group’s
\ncontracts database, the Group’s Eclipse database for radio and secure products
\nor the Group’s Oracle database for test equipment (the “Personal Property
\nLeases”) and (ii) the third party software licenses and programs listed on
\nSchedule 1.1(b) (the “Software Licenses”);<\/p>\n
(c) Tangible Personal Property. All tangible personal property
\n(including machinery, equipment, computers, laboratory and test equipment and
\napparatus, furniture, furnishings, tools, dies and vehicles) owned by Seller or
\nany of Seller’s Affiliates and set forth in the fixed asset ledger maintained by
\nthe Group (as the same will be adjusted as indicated on Schedule 1.1(c)), in the
\ncase of capital assets, or otherwise used or held for use primarily in relation
\nto the business or operation of the Group with respect to non-capital assets,
\nincluding without limitation those items listed on Schedule 1.1(c) (the
\n“Tangible Personal Property”), including any purchases and less any retirements
\nor dispositions of Tangible Personal Property made between the Balance Sheet
\nDate and the Closing Date in the ordinary course of business, consistent with
\npast practices of Seller;<\/p>\n
(d) Inventory. All inventory, wherever located, including raw
\nand recycled materials, work-in-progress and finished goods inventories,
\nsupplies and spare parts and used or held for use primarily in relation to the
\nAcquired Assets or the business or operation of the Group (“Inventory”), except
\nany sales, retirements or dispositions of Inventory made between the Balance
\nSheet Date and the Closing Date in the ordinary course of business, consistent
\nwith past practices of Seller;<\/p>\n
(e) Real Property. (i) All real property and interests in real
\nproperty owned by Seller in Scottsdale, Arizona, used primarily in connection
\nwith the business or operation of the Group and listed or described on Schedule
\n1.1(e), including all buildings, fixtures, structures and other improvements of
\nany kind or nature situated thereon, together with all easements, appurtenances,
\nleases, tenancies, options, rights-of-way and other real property rights and
\ninterests relating thereto (the “Owned Premises”), (ii) the real property leases
\nlisted or described on Schedule 1.1(e) (the “Assumed Real Property Leases”) and
\n(iii) the Motorola Credit Union Ground Lease and Seller’s residual interest, if
\nany, in the building, fixtures, structures and other improvements on the land
\nrelating thereto;<\/p>\n
(f) Receivables. All accounts and notes receivable and
\nunbilled revenues to the extent arising from the sale of goods or materials and
\nthe rendering of services in connection <\/p>\n
2<\/p>\n
with the business or operation of the Group, including related deposits,
\nsecurity and collateral therefor and including any of the same that are payable
\nby other groups, sectors or Affiliates of Seller (the “Accounts Receivable”),
\ntogether with all unpaid interest accrued thereon, if any, as the same exist on
\nthe Closing Date;<\/p>\n
(g) Business Records. All books and records of Seller or
\nSeller’s Affiliates to the extent relating to the Acquired Assets or the
\nbusiness or operation of the Group including, without limitation, all manuals,
\ndata, sales and advertising materials, customer and supplier lists and reports,
\nsales, distribution and purchase correspondence, engineering drawings, notebooks
\nand logbooks, and all original and duplicate copies of the foregoing (the “Books
\nand Records”);<\/p>\n
(h) Intellectual Property. The rights of Seller and Seller’s
\nAffiliates transferred to Buyer pursuant to the Intellectual Property Agreement;<\/p>\n
(i) Permits. To the extent assignable to Buyer and not
\nrequired for the ownership or operation of a business or assets to be retained
\nby Seller or Seller’s Affiliates, the Permits;<\/p>\n
(j) Prepaid Charges. All deferred and prepaid charges,
\nrecoverable deposits, advances, expenses, sums and fees of Seller and Seller’s
\nAffiliates to the extent related to the Group or the Assumed Liabilities arising
\nfrom payments made prior to the Closing Date for goods or services where such
\ngoods or services have not been received as of the Closing Date;<\/p>\n
(k) Claims. Except for those claims of Seller relating to the
\nsale of bomb fuzes to the United States Government under FMU-140, all rights,
\nclaims or causes of action of Seller or any of Seller’s Affiliates against Third
\nParties to the extent arising out of the business or operation of the Group, the
\nAcquired Assets or the Assumed Liabilities;<\/p>\n
(l) Employee Benefits. Those assets under the employee
\nbenefit plans of Seller to be transferred to Buyer pursuant to the Employee
\nMatters Agreement;<\/p>\n
(m) Telephone Numbers. All of Seller’s interests in the
\ntelephone numbers listed on Schedule 1.1(m); and<\/p>\n
(n) Goodwill. The goodwill of the Group.<\/p>\n
1.2 Excluded Assets. Notwithstanding the foregoing, Seller does not
\nhereby sell, assign, transfer or convey, and Buyer does not hereby accept or
\npurchase any of the assets, properties, rights, contracts and claims of Seller
\nor its Affiliates except for the Acquired Assets, and, without limiting the
\ngenerality of the foregoing, the following assets, properties, rights, contracts
\nand claims of Seller or its Affiliates shall not be sold, assigned, transferred
\nor conveyed to Buyer.<\/p>\n
(a) Cash. Cash and cash equivalents (including any marketable
\nsecurities or certificates of deposit);<\/p>\n
3<\/p>\n
(b) Affiliate Transactions. Except for Accounts Receivable as
\nset forth in Section 1.1(f), any agreements, transactions, accounts, contracts,
\ncommitments or arrangements with other groups, sectors, or Affiliates of Seller;<\/p>\n
(c) Claims. Any rights, claims or causes of action of Seller
\nand Seller’s Affiliates against Third Parties to the extent arising in
\nconnection with the Excluded Assets or the Excluded Liabilities including,
\nwithout limitation, those claims of Seller relating to the sale of bomb fuzes to
\nthe United States Government under FMU-140;<\/p>\n
(d) Employee Benefits. The assets and rights under the
\nemployee benefit plans of Seller other than the assets to be transferred to
\nBuyer pursuant to the Employee Matters Agreement;<\/p>\n
(e) Insurance. Policies of insurance and any proceeds or
\nreturn of premiums thereunder;<\/p>\n
(f) Tax Refunds. All claims, rights and interests of Seller
\nand Seller’s Affiliates in and to any refunds for Taxes relating to the Group,
\nthe Owned Premises, the Assumed Real Property Leases or the other Acquired
\nAssets for periods ending on or prior to the Closing Date;<\/p>\n
(g) Corporate Documents. Seller’s corporate charter, seal,
\nminute books, stock record books, and other similar documents relating to the
\norganization, maintenance and existence of Seller or any of Seller’s Affiliates;<\/p>\n
(h) Transaction Records. Any records prepared in connection
\nwith the transfer of the Acquired Assets, including bids received from others
\nand analyses relating to the Group and the Acquired Assets prepared in
\nconnection with the transfer of the Acquired Assets;<\/p>\n
(i) Company Name. Any trade name, trademark, service mark or
\nlogo using or incorporating the name “Motorola” or any derivations thereof;<\/p>\n
(j) Agreement Rights. Any rights of Seller under or pursuant
\nto this Agreement, the Ancillary Agreements and any other instrument between
\nSeller and Buyer or their respective Affiliates entered into pursuant to this
\nAgreement or the transactions contemplated hereby;<\/p>\n
(k) Records and Documents. All records and documents to the
\nextent relating to the Excluded Assets or the Excluded Liabilities, including
\nwithout limitation any Books and Records (including Books and Records relating
\nto the Iridium Claims), to the extent such Books and Records relate to Excluded
\nAssets or Excluded Liabilities and are covered by the attorney-client privilege,
\nthe work product doctrine, or any other judicially recognized privilege,
\nprotection or immunity from disclosure (collectively, “Protected Materials”), it
\nbeing expressly understood and agreed (i) that Seller does not intend to waive
\nany such privilege, protection or immunity but rather intends to preserve all
\nsuch privileges, protections and\/or immunities and (ii) that Buyer shall
\npromptly notify Seller in the event that, after the Closing Date, Buyer
\ndiscovers <\/p>\n
4<\/p>\n
any Books and Records which Buyer reasonably believes constitute
\nProtected Materials which have been inadvertently transferred from Seller to
\nBuyer;<\/p>\n
(l) Ownership Interests. The Certicom Investment;<\/p>\n
(m) Scheduled Excluded Assets. Any of the assets listed on
\nSchedule 1.2(m); and<\/p>\n
(n) Scheduled Excluded Contracts. Any of the contracts listed
\non Schedule 1.2(n).<\/p>\n
1.3 Assumed Liabilities. Upon the terms and subject to the conditions
\nof this Agreement, Buyer hereby agrees to assume, perform, pay and discharge, in
\naccordance with the respective terms and subject to the respective conditions
\nthereof, the following liabilities and obligations of Seller relating to or
\narising out of the business or operation of the Group or the Acquired Assets,
\nexcluding the Excluded Liabilities (the “Assumed Liabilities”):<\/p>\n
(a) Liabilities. All liabilities, debts, obligations,
\njudgments, fines, penalties, claims and Proceedings relating to the business or
\noperation of the Group or the Acquired Assets, whether accrued, liquidated,
\ncontingent, matured or unmatured, arising out of events occurring after the
\nClosing Date;<\/p>\n
(b) Accounts Payable. All accounts payable and accrued payment
\nobligations of Seller to the extent relating to or arising out of the business
\nor operation of the Group, including any of the same that are payable to other
\ngroups, sectors or Affiliates of Seller (the “Accounts Payable”), existing as of
\nthe Closing Date (whether arising prior to or on the Closing Date);<\/p>\n
(c) Contracts. All liabilities, obligations and Proceedings
\narising under the Contracts, including without limitation the Government
\nContracts, the Material Contracts, the Personal Property Leases, the Software
\nLicenses and the Assumed Real Property Leases, whether incurred or arising prior
\nto, on or after the Closing Date, but excluding (i) any liability or obligation
\nrelating to or involving the sale by the Group of bomb fuzes to the United
\nStates Government under FMU-140 or (ii) any other liability or obligation
\narising out of criminal conduct or civil fraud occurring on or prior to the
\nClosing Date;<\/p>\n
(d) Warranty Claims. Any and all claims and Proceedings
\nrelating to warranty obligations or services or claims of manufacturing or
\ndesign defects with respect to any product or service sold or provided by the
\nGroup whether prior to, on, or after the Closing Date, whether or not such
\nclaims or Proceedings were accrued, liquidated, contingent, or known or unknown
\nto Seller at or prior to the Closing Date;<\/p>\n
(e) Employment. Any liability or obligation to the extent
\nprovided in the Employee Matters Agreement with respect to the subject matters
\ncovered thereby;<\/p>\n
(f) Environmental. Any liability or obligation to the extent
\nprovided in the Environmental Matters Agreement with respect to the subject
\nmatters covered thereby; and<\/p>\n
5<\/p>\n
(g) Intellectual Property. Any liability or obligation to the
\nextent provided in the Intellectual Property Agreement with respect to the
\nsubject matters covered thereby.<\/p>\n
1.4 Excluded Liabilities. Notwithstanding anything to the contrary in
\nthis Agreement or the Ancillary Agreements, Buyer shall not assume or be
\nobligated to pay, perform or otherwise assume or discharge any liabilities or
\nobligations of Seller or any of its Affiliates, whether direct or indirect,
\nknown or unknown, or absolute or contingent, except for the Assumed Liabilities
\n(all of such liabilities and obligations not so assumed being referred to herein
\nas the “Excluded Liabilities”), and, without limiting the generality of the
\nforegoing, the following obligations and liabilities relating to the Group or
\nthe Acquired Assets shall not be assumed by Buyer and shall be retained by
\nSeller:<\/p>\n
(a) Certain Claims. Any liability or obligation in respect of
\nthe Proceedings described on Schedule 1.4(a);<\/p>\n
(b) Taxes. Any Taxes relating to the Group, the Owned
\nPremises, the Assumed Real Property Leases or the other Acquired Assets owed for
\nperiods ending on or prior to the Closing Date;<\/p>\n
(c) Indebtedness. Any liability or obligation of Seller in
\nrespect of indebtedness for borrowed money;<\/p>\n
(d) Excluded Assets. Any liability or obligation relating to
\nthe Excluded Assets;<\/p>\n
(e) Employees. Any liability or obligation not expressly
\nassumed by Buyer pursuant to the Employee Matters Agreement with respect to the
\nsubject matters covered thereby;<\/p>\n
(f) Environmental. Any liability or obligation not expressly
\nassumed by Buyer pursuant to the Environmental Matters Agreement with respect to
\nthe subject matters covered thereby;<\/p>\n
(g) Intellectual Property. Any liability or obligation not
\nexpressly assumed by Buyer pursuant to the Intellectual Property Agreement with
\nrespect to the subject matters covered thereby; and<\/p>\n
(h) Scheduled Excluded Liabilities. All of the liabilities
\nand obligations set forth on Schedule 1.4(h).<\/p>\n
ARTICLE II<\/p>\n
PURCHASE PRICE<\/p>\n
2.1 Purchase Price. At the Closing, in consideration of the sale,
\ntransfer, assignment, conveyance and delivery by Seller of the Acquired Assets
\nto Buyer, Buyer shall assume the Assumed Liabilities and cause to be delivered
\nthe sum of $825,000,000 (the “Purchase Price”) to <\/p>\n
6<\/p>\n
Seller by bank wire transfer in immediately available funds to an account which
\nshall be designated in writing by Seller at least two Business Days prior to the
\nClosing Date.<\/p>\n
2.2 Allocation<\/p>\n
(a) Within 120 days after the Closing, Buyer will deliver to
\nSeller a statement (the “Allocation Statement”) prepared in accordance with
\nSection 2.2(b), setting forth its calculation of the amount of the total
\nconsideration allocable to the Acquired Assets acquired at the Closing. Seller
\nwill review the Allocation Statement and, to the extent Seller disagrees in good
\nfaith with the content of the Allocation Statement, Seller will inform Buyer of
\nsuch disagreement within 30 days after receipt of the Allocation Statement.
\nSeller and Buyer will attempt to resolve any such disagreement. If Seller and
\nBuyer are unable to reach a good faith agreement on the content of the
\nAllocation Statement within 180 days of the Closing Date, Seller and Buyer shall
\neach use its own allocation statement.<\/p>\n
(b) The Allocation Statement will be prepared in accordance
\nwith Section 1060 of the Code and the rules and regulations promulgated
\nthereunder.<\/p>\n
(c) If Buyer and Seller agree on the Allocation Statement,
\nBuyer and Seller shall report the allocation of the total consideration among
\nthe Acquired Assets in a manner consistent with the Allocation Statement and
\nshall act in accordance with the Allocation Statement in the preparation and
\nfiling of all Tax returns (including filing Form 8594 with their respective
\nFederal income tax returns for the taxable year that includes the Closing Date
\nand any other forms or statements required by the Code, Treasury regulations,
\nthe Internal Revenue Service or any applicable state or local taxing authority).<\/p>\n
(d) Buyer and Seller will promptly inform one another of any
\nchallenge by any taxing authority to any allocation made pursuant to this
\nSection 2.2 and agree to consult with and keep one another informed with respect
\nto the status of, and any discussion, proposal or submission with respect to,
\nsuch challenge.<\/p>\n
2.3 Transaction Taxes. All sales, use, transfer, recording, value
\nadded, and any other transaction taxes and charges, if any, arising out of the
\ntransfer of the Acquired Assets to Buyer will be shared equally by Buyer and
\nSeller. Buyer and Seller agree to cooperate in obtaining any sales or transfer
\ntax exemptions.<\/p>\n
ARTICLE III<\/p>\n
REPRESENTATIONS AND WARRANTIES OF SELLER<\/p>\n
Seller hereby represents and warrants to Buyer, as of the date hereof,
\nand as of the Closing Date, as follows:<\/p>\n
3.1 Organization, Qualification. Seller is a corporation duly
\nincorporated, validly existing and in good standing under the laws of the State
\nof Delaware. Seller has the requisite corporate power to own its properties and
\ncarry on the business and operations of the Group as now conducted by Seller.
\nSeller is duly licensed or qualified to do business and is in good <\/p>\n
7<\/p>\n
standing in each jurisdiction in which it is required to be licensed or
\nqualified to do business and in which the failure to be so licensed or qualified
\nor in good standing would have a Material Adverse Effect or a material adverse
\neffect on the ability of Seller to perform its obligations under this Agreement
\nand the Ancillary Agreements. Neither Seller nor any of its Affiliates owns or
\nholds the right to acquire any shares of stock or any other investment or equity
\ninterest in any other corporation, partnership, joint venture or other entity to
\nwhich Buyer would become the successor as a result of the consummation of the
\ntransactions contemplated by this Agreement and the Ancillary Agreements.<\/p>\n
3.2 Due Execution. All corporate acts required to be taken by Seller
\nto authorize the execution and delivery of this Agreement, the Ancillary
\nAgreements and all instruments and transactions contemplated hereby have been
\nduly and properly taken. This Agreement has been, and the Ancillary Agreements,
\ndocuments and instruments to be delivered by Seller at Closing will be, duly and
\nvalidly executed and delivered by Seller and constitute the valid and legally
\nbinding obligations of Seller enforceable against it in accordance with their
\nrespective terms, except in each case as such enforceability may be limited by
\nbankruptcy, moratorium, insolvency, reorganization or other similar laws
\naffecting or limiting the enforcement of creditors rights generally and except
\nas such enforceability is subject to general principles of equity.<\/p>\n
3.3 No Violations.<\/p>\n
(a) The execution, delivery and performance of this Agreement
\nand the Ancillary Agreements by Seller and the consummation of the transactions
\ncontemplated hereby and thereby do not and will not: (i) conflict with or result
\nin a breach or violation of any provision of Seller’s certificate of
\nincorporation or by-laws or of any statute, rule, regulation or ordinance
\napplicable to Seller, (ii) conflict with or violate or result in a breach of or
\nconstitute a default (or an event that is reasonably expected, upon the passage
\nof time or the giving of notice, or both, to constitute a default) under any
\nprovision of, result in the acceleration or cancellation of any obligation
\nunder, or give rise to a right by any party to terminate or amend its
\nobligations under, any mortgage, deed of trust, note, loan, indenture, lien,
\nlease, agreement, instrument, order, judgment, decree or other arrangement or
\ncommitment to which Seller is a party or by which it or its assets or properties
\nare bound, or (iii) conflict with or violate any order, judgment, decree, rule
\nor regulation of any court or any Governmental Authority having jurisdiction
\nover Seller or any of the Acquired Assets, except in each case for (A) such
\nconflicts, breaches, violations or defaults as are not reasonably expected to
\nresult in a Material Adverse Effect; or (B) the need to obtain the consents,
\napprovals and filings set forth on Schedule 3.3.<\/p>\n
(b) No consent, approval, order or authorization of, or
\nregistration, declaration or filing with, any Person is required by Seller in
\nconnection with the execution and delivery of this Agreement and the Ancillary
\nAgreements or the consummation of the transactions contemplated hereby or
\nthereby, except for (i) any of the same the failure of which to obtain or make
\nis not reasonably expected to result in a Material Adverse Effect, (ii) any
\nfilings required to be made under the HSR Act, and (iii) consents, approvals or
\nother actions of Third Parties identified on Schedule 3.3 which are required to
\ntransfer or assign to Buyer any Acquired Assets or assign the benefits of or
\ndelegate performance with regard thereto.<\/p>\n
8<\/p>\n
3.4 Taxes.<\/p>\n
(a) Except as set forth on Schedule 3.4, with respect to the
\nbusiness or operation of the Group and the Acquired Assets: (i) Seller has filed
\nor will file all federal, state, local and foreign tax returns when and as
\nSeller has been or is required by law to file for periods ending on or before
\nthe Closing Date; (ii) Seller has paid, and will pay for all periods ending on
\nor before the Closing Date, all taxes (whether or not shown on any such tax
\nreturn) when and as the same shall be due and payable by Seller, including
\nwithout limitation all foreign or domestic income, excise, unemployment, social
\nsecurity, occupation, franchise, real and personal property, ad valorem, sales
\nand use taxes and all penalties and interest in respect thereof (“Taxes”) and
\nall Taxes not yet due and payable are and shall be properly accrued for in the
\nfinancial records of the Group; and (iii) Seller has withheld and paid over, and
\nwill withhold and pay over for all periods ending on or before the Closing Date,
\nall federal, state, local and foreign withholdings in respect of Taxes required
\nby law.<\/p>\n
(b) Except as disclosed on Schedule 3.4, none of the Acquired
\nAssets: (i) secures any debt the interest on which is tax-exempt under Code
\nSection 103(a); (ii) is “tax exempt use property” within the meaning of Code
\nSection 168(h); (iii) is used predominantly outside of the United States within
\nthe meaning of U.S. Proposed Treasury Regulation Section 1.168-2(g)(5); (iv) is
\n“tax exempt bond financed property” within the meaning of Code Section
\n168(g)(5); (v) is “limited use property” within the meaning of Revenue Procedure
\n76-30 as modified by Revenue Procedure 81-71; or (vi) will be treated as owned
\nby another Person pursuant to the provisions of Section 168(f)(8) of the
\nInternal Revenue Code of 1954, as amended and in effect prior to the enactment
\nof the Tax Equity and Fiscal Responsibility Act of 1982.<\/p>\n
(c) The transactions contemplated by this Agreement are not
\nsubject to Tax withholding pursuant to the provisions of Code Section 3406 or
\nSubchapter A of Chapter 3 of the Code. Seller is a United States Person within
\nthe meaning of the Code. Seller has never been a United States real property
\nholding corporation within the meaning of Code Section 897(c)(2).<\/p>\n
(d) There is no contract, agreement, plan or arrangement
\ncovering any employee of the Group that, individually or collectively, provides
\nfor the payment prior to or in connection with this transaction by Buyer of any
\namount: (i) that is not deductible under Section 162(a)(1) or 404 of the Code;
\nor (ii) that is an “excess parachute payment” under Code Section 280G.<\/p>\n
(e) There are no Liens for Taxes of any kind on any of the
\nAcquired Assets, except for Taxes not yet due and payable.<\/p>\n
3.5 Litigation. Except as set forth on Schedule 3.5, there are no
\nProceedings that (i) contain a claim for money damages of $500,000 or more, (ii)
\nseek injunctive or other equitable relief which if granted would be reasonably
\nexpected to result in a Material Adverse Effect or (iii) relate to this
\nAgreement or the transactions contemplated hereby, in each case pending or, to
\nSeller’s Knowledge, threatened against Seller relating to the business or
\noperation of the Group, the Acquired Assets, the Assumed Liabilities or Seller’s
\nability or authority to consummate the transactions contemplated by this
\nAgreement and the Ancillary Agreements.<\/p>\n
9<\/p>\n
3.6 Acquired Assets.<\/p>\n
(a) Seller, or its Affiliates, as applicable, has good and
\nmarketable title to, or a valid license to or leasehold interest in, all
\nAcquired Assets free and clear of any Lien, except for Permitted Liens. The
\nitems of personal property included in the Acquired Assets and currently used in
\nthe business or operation of the Group are in normal operating condition,
\nsubject to normal wear and tear, and are suitable for the purposes for which
\nthey are currently being used.<\/p>\n
(b) Except as set forth on Schedule 3.6(b), all assets,
\nproperties and rights owned or used by Seller and its Affiliates in connection
\nwith the current operation or business of the Group shall be owned or available
\nfor use by Buyer on substantially similar terms and conditions immediately after
\ngiving effect to the consummation of the transactions contemplated by this
\nAgreement and the Ancillary Agreements, except for the failure of such of the
\nforegoing as is not reasonably expected to have a Material Adverse Effect.<\/p>\n
3.7 Real Property.<\/p>\n
(a) Schedule 3.7 contains a complete and accurate list and
\nlegal description of all Owned Premises (including addresses) and a complete and
\naccurate list of all Leased Premises (including addresses, the name of each
\nlandlord and the date of each lease). Except as set forth on Schedule 3.7, the
\nPremises constitute all of the real property and interests in real property
\nowned, leased, used or held for use by Seller or its Affiliates in relation to
\nthe business or operation of the Group. Seller has good and marketable fee
\nsimple title to the Owned Premises designated as the “Fee Simple Owned Property”
\non Schedule 1.1(e), free and clear of all mortgages, liens, security interests,
\neasements, covenants, restrictions, rights-of-way and other liens, claims and
\nsimilar encumbrances and restrictions of any nature whatsoever, except for the
\nPermitted Liens. Except as described or provided in the Environmental Matters
\nAgreement, the Permitted Liens do not, individually or in the aggregate,
\nmaterially and adversely affect the use, value or operation of the Premises or
\nany parcel or component thereof.<\/p>\n
(b) Except as set forth on Schedule 3.7 and for any of the
\nfollowing the failure of which to be true and correct is not reasonably expected
\nto result in a Material Adverse Effect, (i) to Seller’s Knowledge, all
\nimprovements located on each parcel of the Premises are in good operating
\ncondition and in a good state of maintenance and repair (normal wear and tear
\nexcepted), have been regularly and appropriately maintained, are adequate for
\ntheir current use in the business or operation of the Group and are free from
\nstructural defect, except for scheduled maintenance, repairs and replacements to
\nbe performed in the ordinary course of the operation of the Premises, (ii) to
\nSeller’s Knowledge, there is not now pending any condemnation or eminent domain
\nproceeding affecting any of the Premises or any portion thereof or any lawsuits
\nor administrative actions relating to any of the Premises that is reasonably
\nexpected to have a material adverse effect on the current use, occupancy or
\nvalue of such Premises, nor is any such proceeding threatened by any
\nGovernmental Authority or other party, (iii) all Permits necessary for the
\noperation and current use of the Premises have been issued and are in full force
\nand effect, (iv) each of the Premises is served by all necessary water, sewer,
\ngas, electric, telephone, drainage facilities and other utilities or services
\nnecessary for the current operation thereof (collectively, “Utilities”) and, to
\nSeller’s Knowledge, no fact or condition exists that is <\/p>\n
10<\/p>\n
reasonably expected to result in the discontinuation of any of the Utilities,
\n(v) to Seller’s Knowledge, each of the Premises has been operated and maintained
\nin compliance with all applicable Laws, including, without limitation, all
\napplicable building codes, zoning, subdivision and land use laws, (vi) Seller
\nhas not received written notice that the use or occupancy of any of the Premises
\nviolates any covenants, conditions or restrictions that encumber the Premises,
\nand (vii) there are no leases, subleases, licenses, concessions or other
\nagreements, written or oral, granting to any other person or entity the right of
\nuse or occupancy of any portion of any of the Premises, except for the Permitted
\nLiens, the Motorola Credit Union Ground Lease and any third party antenna
\nagreements.<\/p>\n
(c) Seller has heretofore delivered to Buyer a true, correct
\nand complete copy of each Real Property Lease together with all amendments,
\nmodifications, alterations and other changes thereto. All of the Assumed Real
\nProperty Leases are valid, binding and enforceable against Seller and, to
\nSeller’s Knowledge, against the other parties thereto, and there exists no
\nbreach or default, or state of facts which, with the passage of time, notice, or
\nboth, is reasonably expected to result in a breach or default on the part of
\nSeller or, to Seller’s Knowledge, the other party or parties to any Real
\nProperty Lease. None of the leasehold estates in the Leased Premises subject to
\nthe Assumed Real Property Leases is subject to any mortgage, lien, security
\ninterest or other Lien created or caused by Seller that would survive the
\nClosing and the assignment of the Assumed Real Property Leases. The Real
\nProperty Lease with respect to each of the Leased Premises constitutes the
\nentire agreement to which Seller is a party with respect to the Leased Premises
\nleased thereunder.<\/p>\n
3.8 Compliance with Laws. Except as set forth on Schedule 3.8, Seller
\nhas complied with all Laws applicable to the business and operation of the
\nGroup, except where the failure to so comply is not reasonably expected to have
\na Material Adverse Effect.<\/p>\n
3.9 Material Contracts. Schedule 3.9 contains a list of each of the
\nfollowing Contracts (each of which shall be deemed a “Material Contract”) to
\nwhich Seller or any of its Affiliates is a party with respect to the business or
\noperation of the Group or the Acquired Assets:<\/p>\n
(a) any Contract that obligates Seller or any of its
\nAffiliates to pay an amount in excess of $5,000,000 after the date hereof;<\/p>\n
(b) any Contract for the sale of products or systems or the
\nprovision of services that involves the anticipated accrual or receipt of
\nrevenues of more than $5,000,000 after the date hereof;<\/p>\n
(c) any Contract, lease or similar agreement relating to the
\npurchase, sale or use of real property;<\/p>\n
(d) any material agreement or arrangement that relates to the
\nprovision of goods or services to or by the Group by or to Seller or any other
\ngroup, sector or Affiliate of Seller;<\/p>\n
11<\/p>\n
(e) any confidentiality agreement that restricts in any
\nmaterial way the business or operation of the Group or the use of any of the
\nAcquired Assets or any non-competition agreement that restricts in any way the
\nbusiness or operation of the Group or the use of any of the Acquired Assets;<\/p>\n
(f) any collective bargaining agreements with any labor union
\nor representative of employees relating to or affecting the Group or the
\nAcquired Assets;<\/p>\n
(g) any partnership, joint venture, teaming, co-production or
\nprofit sharing Contracts;<\/p>\n
(h) any employment agreement with any Employee other than
\nSeller’s standard form letter agreement;<\/p>\n
(i) any agreement committing Seller or any of its Affiliates
\nto purchase or sell any property or asset in respect of the business or
\noperation of the Group outside the ordinary course of business;<\/p>\n
(j) any Contract constituting a material distribution or
\nsales agency agreement;<\/p>\n
(k) any material Software Licenses;<\/p>\n
(l) any restricted contract; or<\/p>\n
(m) any contract involving the handling, treatment, storage,
\ntransportation, recycling, reclamation or disposal of waste or hazardous
\nsubstances generated by or used by the Group, which has not been entered into in
\nthe ordinary course of business.<\/p>\n
Except as prohibited by law, by the terms of such Material Contract, or
\nunder any confidentiality agreement, or as specifically set forth on Schedule
\n3.9, Seller has made available to Buyer copies of all Material Contracts, which
\ncopies are complete and accurate in all material respects. Except as described
\non Schedule 3.9 or Schedule 3.10(a), each Material Contract is valid and binding
\nand is in full force and effect as to Seller, and, to Seller’s Knowledge,
\nrepresents the legal, valid and binding obligation of the other party or parties
\nthereto, enforceable against such party or parties in accordance with its terms.
\nExcept as disclosed on Schedule 3.9 or with respect to the Government Contracts,
\nwhich are the subject of Section 3.10 and therefore not covered by this
\nsentence, Seller or the applicable Affiliate of Seller has performed all
\nobligations required to be performed by it under each Material Contract through
\nthe date this representation is made, except where the failure to perform is not
\nreasonably expected to result in a Material Adverse Effect, and is not (with or
\nwithout the lapse of time or the giving of notice, or both) in material breach
\nor material default thereunder and, to Seller’s Knowledge, no other party
\nthereto is (with or without the lapse of time or the giving of notice, or both)
\nin material default under any Material Contract.<\/p>\n
12<\/p>\n
3.10 Government Contracts.<\/p>\n
(a) Compliance. Except as set forth on Schedule 3.10(a), with
\nrespect to each and every Government Contract or Government Proposal and for all
\nperiods from and after January 1, 1998 (i) Seller has complied with all terms
\nand conditions of such Government Contract or Government Proposal except where
\nthe failure to comply is not reasonably expected to result in a Material Adverse
\nEffect; (ii) Seller has complied with all requirements of all Laws or agreements
\npertaining to such Government Contract or Government Proposal except where the
\nfailure to comply is not reasonably expected to result in a Material Adverse
\nEffect; (iii) all representations and certifications executed, acknowledged or
\nset forth in or pertaining to such Government Contract or Government Proposal
\nwere, to Seller’s Knowledge, complete and correct as of their effective dates
\nand, to Seller’s Knowledge, Seller has complied with all such representations
\nand certifications; (iv) neither the United States Government nor any prime
\ncontractor, subcontractor or other person has notified Seller in writing that
\nSeller has breached or violated any statute, regulation, certification,
\nrepresentation, clause, provision or requirement pertaining to such Government
\nContract or Government Proposal; (v) no termination for convenience, termination
\nfor default, cure notice or show cause notice is currently in effect; (vi) with
\nrespect to any Government Contract, the United States Government has not
\nquestioned or disallowed costs exceeding $1,000,000 per contract; (vii) no money
\ndue to Seller pertaining to such Government Contract or Government Proposal has
\nbeen withheld or set off, nor has any claim been made to withhold or set off
\nmoney, and, to Seller’s Knowledge Seller is entitled to all progress payments
\nreceived with respect thereto; and (viii) each Government Contract is valid and
\nsubsisting.<\/p>\n
(b) Investigations. Except as set forth on Schedule 3.10(b),
\nwith respect to the business and operation of the Group: (i) none of Seller, the
\nGroup nor any employee or consultant of Seller or the Group is, or during the
\nlast three years has been, under, to Seller’s Knowledge, administrative, civil
\nor criminal investigation by the United States Government or under any internal
\naudit by Seller or the Group with respect to any alleged irregularity,
\nmisstatement or omission arising under or relating to any Government Contract or
\nGovernment Proposal; (ii) during the last three years, Seller has not conducted
\nor initiated any material internal investigation or made a voluntary disclosure
\nto the United States Government with respect to any alleged irregularity,
\nmisstatement or omission arising under or relating to a Government Contract or
\nGovernment Proposal, and (iii) during the last three years, none of the Seller,
\nthe Group nor any employee or consultant of Seller or the Group has been
\nsuspended or disbarred from doing business with the United States Government or
\nhas been the subject of a finding of nonresponsibility on a Government Proposal
\nnor has any debarment or suspension proceeding been initiated against Seller or
\nthe Group. To Seller’s Knowledge, there exist no facts or circumstances that
\nwould warrant the institution of suspension or debarment proceedings or the
\nfinding of nonresponsibility on the part of Seller or the Group or any of their
\nrespective directors, officers or employees. No payment has been made by or on
\nbehalf of Seller or the Group in connection with any Government Contract or
\nGovernment Proposal in violation of applicable procurement laws, rules and
\nregulations or in violation of, or requiring disclosure pursuant to, the Foreign
\nCorrupt Practices Act of 1977, as amended.<\/p>\n
13<\/p>\n
(c) Absence of Claims. Except as set forth on Schedule
\n3.10(c), with respect to the Group, there exist: (i) to Seller’s Knowledge, no
\noutstanding material claims against Seller either by the United States
\nGovernment or by any prime contractor, subcontractor, vendor or other third
\nparty, arising under or relating to any Government Contract or Government
\nProposal; and (ii) no material disputes between Seller and the United States
\nGovernment under the Contract Disputes Act or between Seller and any prime
\ncontractor, subcontractor or vendor arising under or relating to any Government
\nContract or Government Proposal.<\/p>\n
(d) Cost Accounting Systems. Except as set forth on Schedule
\n3.10(d), the cost accounting and contractor purchasing systems maintained by
\nSeller in connection with the conduct of the business and operations of the
\nGroup with respect to Government Contracts are in compliance with all applicable
\nLaws (including all applicable cost accounting standards) in all material
\nrespects.<\/p>\n
3.11 Permits. Seller currently has all Permits from all federal,
\nstate, local and foreign authorities as are necessary for the conduct of the
\nbusiness or operation of the Group as currently conducted as of the date hereof,
\nexcept where the failure to have any Permit is not reasonably expected to result
\nin a Material Adverse Effect.<\/p>\n
3.12 Clearances. Except to the extent prohibited by Law, Schedule 3.12
\nsets forth with respect to the Acquired Assets or business or operation of the
\nGroup, all material facility security clearances held by Seller (the
\n“Clearances”).<\/p>\n
3.13 Financial Statements. Seller has provided to Buyer a copy of the
\nBalance Sheet as of the Balance Sheet Date, the Pro Forma Balance Sheet as of
\nthe Balance Sheet Date and the income statement for the Group for the six (6)
\nmonth period ending on the Balance Sheet Date (collectively, the “Financial
\nStatements”), true copies of which are attached to this Agreement as Exhibit H.
\nThe Financial Statements (a) are in accordance with the Books and Records of
\nSeller; (b) have been prepared in accordance with GAAP in all material respects,
\nexcept as disclosed on Exhibit H; and (c) present fairly and accurately the
\nfinancial condition and results of operations for the periods indicated. The
\nFinancial Statements have not been prepared, reviewed or audited by an outside
\naccounting firm. The reserves in the Financial Statements for Contracts,
\nwarranties, customer claims, and other liabilities have been determined based on
\nSeller’s historical experiences and represent Seller’s reasonable good faith
\nestimate of the expected liabilities to which they relate and are reflected in
\nthe Financial Statements in accordance with GAAP.<\/p>\n
3.14 Absence of Undisclosed Liabilities. Except as disclosed or
\nreserved against on the Balance Sheet, or as specifically set forth on Schedule
\n3.14, and except for the Excluded Liabilities, Seller does not have, with
\nrespect to the business or operation of the Group, any debts, liabilities, or
\nobligations of any nature, whether accrued, absolute, contingent or otherwise,
\nother than: (i) liabilities incurred in the ordinary and usual course of
\nbusiness since the Balance Sheet Date, (ii) other debts, liabilities or
\nobligations which are not, in the aggregate, in excess of $1,000,000, and (iii)
\nliabilities not required by GAAP to be included or disclosed on a balance sheet
\nprepared in accordance with GAAP or any notes thereto.<\/p>\n
14<\/p>\n
3.15 Absence of Certain Changes or Events. Except as disclosed on
\nSchedule 3.15, since the Balance Sheet Date:<\/p>\n
(a) Seller has conducted the business and operations of the
\nGroup in the ordinary and usual course of business, and there has not been any
\nevent or series of events that has had or is reasonably expected to have a
\nMaterial Adverse Effect; provided, however, any effect resulting from any change
\nthat is generally applicable to the United States economy or securities markets
\nas a whole or to industries in which the Group operates generally, in each case
\nwhere such change does not adversely affect the business or operation of the
\nGroup or the value of the Acquired Assets disproportionately, shall not
\nconstitute a Material Adverse Effect under this Section 3.15(a);<\/p>\n
(b) there has been no change in the condition, financial or
\notherwise, of the Group, the Acquired Assets or the Assumed Liabilities, other
\nthan any such changes in the ordinary course of business, none of which changes,
\nindividually or in the aggregate, are reasonably expected to be material to the
\nGroup, the Acquired Assets or the Assumed Liabilities;<\/p>\n
(c) except to the extent required by GAAP, applicable Law, or
\nthe United States Government, there has been no change in the method of
\naccounting or keeping of books of account or accounting practices with respect
\nto the Acquired Assets, the Assumed Liabilities or the business or operation of
\nthe Group;<\/p>\n
(d) Seller has not accelerated, delayed or postponed payment
\nof Accounts Payable or the collection of Accounts Receivable outside the
\nordinary course of business consistent with past practices;<\/p>\n
(e) Seller has not made any capital expenditure or commitment
\nin excess of the amounts set forth in the Capital Acquisition Report;<\/p>\n
(f) Seller has not canceled, compromised, waived or released
\nany right or claim material to the business or operations of the Group that is
\nreasonably expected to result in a Material Adverse Effect; and<\/p>\n
(g) Seller has not committed or agreed to do any of the
\nforegoing.<\/p>\n
3.16 Brokers. No broker, investment banker, financial advisor or other
\nPerson is entitled to any broker’s, finder’s, financial advisor’s or other
\nsimilar fee or commission in connection with the transactions contemplated by
\nthis Agreement based on arrangements made by or on behalf of Seller, except
\npursuant to arrangements with those investment banks listed on Schedule 3.16,
\nfor which Seller is solely responsible.<\/p>\n
3.17 Warranty Disclaimer The representations and warranties set forth
\nin this Agreement and in the Ancillary Agreements and other instruments
\ncontemplated hereby and thereby are the only representations and warranties made
\nby Seller with respect to the Group and the Acquired Assets. Except as
\nspecifically set forth herein, Seller is selling the Acquired Assets to Buyer
\n“AS IS” and “WHERE IS” and with all faults. EXCEPT AS SPECIFICALLY SET FORTH IN
\nTHIS AGREEMENT, SELLER MAKES NO WARRANTY, EXPRESS OR <\/p>\n
15<\/p>\n
IMPLIED, AS TO ANY MATTER WHATSOEVER RELATING TO THE ACQUIRED ASSETS, INCLUDING
\nTHE CONDITION OF THE ACQUIRED ASSETS, THEIR MERCHANTABILITY OR THEIR FITNESS FOR
\nANY PARTICULAR PURPOSE. SELLER FURTHER SPECIFICALLY DISCLAIMS ANY WARRANTY
\nREGARDING THE PROFITABILITY OF THE GROUP OR THE STATUS, OUTCOME OR LIKELIHOOD OF
\nSUCCESS OF ANY LITIGATION REFERENCED HEREIN.<\/p>\n
ARTICLE IV<\/p>\n
REPRESENTATIONS AND WARRANTIES OF BUYER<\/p>\n
Buyer hereby represents and warrants to Seller, as of the date hereof,
\nand as of the Closing Date, as follows:<\/p>\n
4.1 Organization; Qualification. Buyer is a corporation duly
\nincorporated, validly existing and in good standing under the laws of the State
\nof Delaware. Buyer has the requisite corporate power to own its properties and
\ncarry on its business as now conducted. Buyer is duly licensed or qualified to
\ndo business and is in good standing in each jurisdiction in which it is required
\nto be licensed or qualified to do business and in which the failure to be so
\nlicensed or qualified or in good standing would have a material adverse effect
\non the ability of Buyer to perform its obligations under this Agreement and the
\nAncillary Agreements.<\/p>\n
4.2 Due Execution. All corporate acts required to be taken by Buyer
\nto authorize the execution and delivery of this Agreement, the Ancillary
\nAgreements and all instruments and transactions contemplated hereby have been
\nduly and properly taken. This Agreement has been, and the Ancillary Agreements,
\ndocuments and instruments to be delivered by Buyer at Closing will be, duly and
\nvalidly executed and delivered by Buyer and constitute the valid and legally
\nbinding obligations of Buyer enforceable against it in accordance with their
\nrespective terms, except in each case as such enforceability may be limited by
\nbankruptcy, moratorium, insolvency, reorganization or other similar laws
\naffecting or limiting the enforcement of creditors rights generally and except
\nas such enforceability is subject to general principles of equity.<\/p>\n
4.3 No Violations.<\/p>\n
(a) The execution, delivery and performance of this Agreement
\nand the Ancillary Agreements by Buyer and the consummation by Buyer of the
\ntransactions contemplated hereby and thereby do not and will not (i) conflict
\nwith or result in a breach or violation of any provision of Buyer’s certificate
\nof incorporation or by-laws or of any statute, rule, regulation or ordinance
\napplicable to Buyer, (ii) conflict with or violate or result in a breach of or
\nconstitute a default (or an event that is reasonably expected, upon the passage
\nof time or the giving of notice, or both, to constitute a default) under any
\nprovision of, result in the acceleration or cancellation of any obligation
\nunder, or give rise to a right by any party to terminate or amend its
\nobligations under, any mortgage, deed of trust, note, loan, indenture, lien,
\nlease, agreement, instrument, order, judgment, decree or other arrangement or
\ncommitment to which Buyer is a party or by which it or its assets or properties
\nare bound, or (iii) conflict with or violate any order, judgment, decree, rule
\nor regulation of any court or any Governmental Authority having jurisdiction
\nover Buyer, except in each case for such conflicts, breaches, violations or
\ndefaults as <\/p>\n
16<\/p>\n
are not reasonably expected to result in a material adverse effect on the
\nability of Buyer to consummate the transactions contemplated by this Agreement
\nand the Ancillary Agreements.<\/p>\n
(b) No consent, approval, order or authorization of, or
\nregistration, declaration or filing with, any Person is required by Buyer in
\nconnection with the execution and delivery of this Agreement and the Ancillary
\nAgreements or the consummation of the transactions contemplated hereby or
\nthereby, except for (i) any of the same the failure of which to obtain or make
\nis not reasonably expected to result in a material adverse effect on the ability
\nof Buyer to consummate the transactions contemplated by this Agreement and the
\nAncillary Agreements, (ii) any filings required to be made under the HSR Act and
\n(iii) such consents, approvals, orders, authorizations, registrations,
\ndeclarations or filings the failure of which to obtain would not, individually
\nor in the aggregate, have a material adverse effect on Buyer’s ability to
\nconsummate the transactions contemplated hereby and thereby.<\/p>\n
4.4 Litigation. There are no Proceedings pending or, to Buyer’s
\nKnowledge, threatened against Buyer relating to the Group, the Acquired Assets,
\nthe Assumed Liabilities or Buyer’s ability or authority to consummate the
\ntransactions contemplated by this Agreement and the Ancillary Agreements where
\nthe outcome is reasonably expected to result in a material adverse effect on the
\nability of Buyer to consummate the transactions contemplated by this Agreement
\nand the Ancillary Agreements.<\/p>\n
4.5 Financing. Buyer has the capability or sufficient funds or
\nfinancing in place as of the date hereof to fund the consideration to be paid at
\nClosing to Seller for the Acquired Assets.<\/p>\n
4.6 Eligibility. During the last three years, neither Buyer nor any
\ndirector or executive officer of Buyer has been debarred, suspended, proposed
\nfor debarment, or found to be nonresponsible by the United States or any United
\nStates government entity. To Buyer’s Knowledge, there exist no facts or
\ncircumstances that would warrant the institution of debarment or suspension
\nproceedings or the finding of nonresponsibility on the part of Buyer or any
\ndirector or executive officer of Buyer.<\/p>\n
4.7 Foreign Ownership. Buyer is not under “foreign ownership, control
\nor influence,” as such term is defined in the U.S. Department of Defense
\nIndustrial Security Manual for Safeguarding Classified Information.<\/p>\n
4.8 Brokers. No broker, investment banker, financial advisor or other
\nPerson is entitled to any broker’s, finder’s financial advisor’s or other
\nsimilar fee or commission in connection with the transactions contemplated by
\nthis Agreement based on arrangements made by or on behalf of Buyer.<\/p>\n
ARTICLE V<\/p>\n
CLOSING<\/p>\n
5.1 Closing. The closing (“Closing”) of the sale and purchase of the
\nAcquired Assets and the assignment and assumption of the Assumed Liabilities
\nshall take place at the offices of Jenner & Block, LLC, One IBM Plaza, Chicago,
\nIllinois at 10:00 a.m. Central Time on the first <\/p>\n
17<\/p>\n
business day after satisfaction or waiver of the conditions set forth in
\nSections 6.1 and 6.2 herein, or at such place, date and time as the parties may
\nagree (the “Closing Date”), but in any event no later than December 31, 2001.
\nAll acts and transactions to be taken or effected at the Closing shall be deemed
\nto have been taken simultaneously and shall be deemed to be effective as of
\n12:01 a.m. Central Time on the Closing Date.<\/p>\n
5.2 Deliveries by Seller. At the Closing, Seller shall deliver or
\ncause to be delivered to Buyer all instruments, duly executed, which are
\nrequired by the terms hereof to be delivered at the Closing, including:<\/p>\n
(a) the Assignment and Assumption Agreement;<\/p>\n
(b) the Bill of Sale;<\/p>\n
(c) the Intellectual Property Agreement;<\/p>\n
(d) the Employee Matters Agreement;<\/p>\n
(e) the Environmental Matters Agreement<\/p>\n
(f) the Transition Services Agreements;<\/p>\n
(g) the Lease;<\/p>\n
(h) the Strategic Alliance Agreement;<\/p>\n
(i) the Commercial Agreements;<\/p>\n
(j) a certificate of Seller, dated as of the Closing Date,
\ncertifying to the fulfillment of the conditions specified in Section 6.1(a) of
\nthis Agreement;<\/p>\n
(k) an affidavit pursuant to Section 1445(b)(2) of the Code
\nstating under penalty of perjury Seller’s federal employer identification number
\nand that Seller is not a foreign person and such other certificates and
\naffidavits relating to Tax matters as may reasonably be requested by Buyer; and<\/p>\n
(l) all such other bills of sale, special or limited warranty
\ndeeds, assignments and other instruments of assignment, transfer or conveyance
\nas Buyer may reasonably request or as may be otherwise necessary to evidence and
\neffect the sale, transfer, assignment, conveyance and delivery of the Acquired
\nAssets to Buyer and to put Buyer in actual possession or control of the Acquired
\nAssets.<\/p>\n
5.3 Deliveries by Buyer At the Closing, Buyer shall deliver or cause
\nto be delivered to Seller all instruments, duly executed, which are required by
\nthe terms hereof to be delivered at the Closing, including:<\/p>\n
(a) an amount equal to the Purchase Price by wire transfer of
\nimmediately available funds in U.S. dollars;<\/p>\n
18<\/p>\n
(b) the Assignment and Assumption Agreement;<\/p>\n
(c) the Intellectual Property Agreement;<\/p>\n
(d) the Employee Matters Agreement;<\/p>\n
(e) the Environmental Matters Agreement;<\/p>\n
(f) the Transition Services Agreements;<\/p>\n
(g) the Lease;<\/p>\n
(h) the Strategic Alliance Agreement;<\/p>\n
(i) the Commercial Agreements; and<\/p>\n
(j) a certificate of Buyer dated as of the Closing Date,
\ncertifying to the fulfillment of the conditions specified in Section 6.2(a) of
\nthis Agreement.<\/p>\n
5.4 Consummation of Transactions. Each of the parties hereto agrees
\nto use all commercially reasonable efforts to consummate all of the transactions
\ncontemplated herein and to be performed by it hereunder.<\/p>\n
ARTICLE VI<\/p>\n
CONDITIONS PRECEDENT TO OBLIGATIONS TO CLOSE<\/p>\n
6.1 Conditions Precedent to Buyer’s Obligations. All obligations of
\nBuyer hereunder are subject to the fulfillment on or before the Closing Date of
\neach of the following conditions:<\/p>\n
(a) No Misrepresentation or Breach of Covenants and
\nWarranties. There shall have been no material breach by Seller in the
\nperformance of any of its covenants and agreements contained herein or in the
\nPrimary Ancillary Agreements; each of the representations and warranties of
\nSeller contained or referred to in this Agreement and the Primary Ancillary
\nAgreements that are qualified as to materiality shall be true and correct and
\nthe other representations and warranties of Seller contained or referred to in
\nthis Agreement and the Primary Ancillary Agreements shall be true and correct in
\nall material respects, in each case on the Closing Date as though made on the
\nClosing Date, unless such representations and warranties are made only as of an
\nearlier date, in which case they shall be true and correct, or true and correct
\nin all material respects, as the case may be, as of such earlier date, and
\nSeller shall have delivered a certificate confirming the matters set forth in
\nthis Section 6.1(a).<\/p>\n
(b) No Injunction. No order of any court or administrative
\nagency shall be in effect that enjoins, restrains, conditions or prohibits
\nconsummation of the transactions contemplated by this Agreement and the
\nAncillary Agreements.<\/p>\n
(c) HSR Act. Any applicable waiting period under the HSR Act
\nrelating to the transactions contemplated by this Agreement shall have expired
\nor been terminated.<\/p>\n
19<\/p>\n
(d) Consents. Seller shall have obtained and delivered to
\nBuyer the written consents specified on Schedule 6.1(d).<\/p>\n
(e) Title Policy. The Title Company shall be prepared to issue
\nto Buyer a title policy in the amount of the fair market value of the Owned
\nPremises as reasonably determined by Buyer, naming Buyer as the insured party
\nthereunder, insuring good and marketable fee simple title to the Owned Premises,
\nsubject only to the Permitted Liens and containing such endorsements as Buyer
\nshall reasonably require including, without limitation, the following
\nendorsements: (i) extended coverage, (ii) zoning, with parking (or its
\nequivalent), (iii) access and (iv) contiguity (the “Title Policies”). The Title
\nPolicies also shall provide affirmative insurance with respect to all easements
\nbenefiting the Owned Premises. All title insurance premiums and charges payable
\nin connection with the issuance of the Title Policies shall be shared equally by
\nBuyer and Seller.<\/p>\n
(f) No Material Adverse Effect. Since the Balance Sheet Date
\nthere shall have been no change in the business or operation or the assets,
\nliabilities or condition (financial or otherwise) of the Group, which is
\nreasonably expected to result in a Material Adverse Effect, excluding any such
\nchange that is generally applicable to the United States economy or securities
\nmarkets as a whole or to industries in which the Group operates generally, in
\neach case where such change does not adversely affect the business or operation
\nof the Group or the value of the Acquired Assets disproportionately.<\/p>\n
(g) Delivery of Documents. Seller shall have delivered the
\ndocuments, instruments and certificates identified in Section 5.2.<\/p>\n
6.2 Conditions Precedent to Seller’s Obligations. All obligations of
\nSeller hereunder are subject to the fulfillment on or before the Closing Date of
\neach of the following conditions:<\/p>\n
(a) No Misrepresentation or Breach of Covenants and
\nWarranties. There shall have been no material breach by Buyer in the performance
\nof any of its covenants and agreements contained herein or in the Primary
\nAncillary Agreements; each of the representations and warranties of Buyer
\ncontained or referred to in this Agreement and the Primary Ancillary Agreements
\nthat are qualified as to materiality shall be true and correct and the other
\nrepresentations and warranties of Buyer contained or referred to in this
\nAgreement and the Primary Ancillary Agreements shall be true and correct in all
\nmaterial respects, in each case on the Closing Date as though made on the
\nClosing Date, unless such representations and warranties are made only as of an
\nearlier date, in which case they shall be true and correct, or true and correct
\nin all material respects, as the case may be, as of such earlier date, and Buyer
\nshall have delivered a certificate confirming the matters set forth in this
\nSection 6.2(a).<\/p>\n
(b) No Injunction. No order of any court or administrative
\nagency shall be in effect that enjoins, restrains, conditions or prohibits
\nconsummation of the transactions contemplated by this Agreement and the
\nAncillary Agreements.<\/p>\n
(c) HSR Act. Any applicable waiting period under the HSR Act
\nrelating to the transactions contemplated by this Agreement shall have expired
\nor been terminated.<\/p>\n
20<\/p>\n
(d) Delivery of Documents. Buyer shall have delivered the
\ndocuments, instruments and certificates identified in Section 5.3.<\/p>\n
ARTICLE VII<\/p>\n
INDEMNIFICATION<\/p>\n
7.1 Indemnification by Seller. Subject to the limitations set forth
\nin this Article VII, Seller hereby agrees to indemnify and hold harmless Buyer
\nor any of its Affiliates or any of their respective directors, officers,
\nemployees or agents (collectively the “Buyer Parties”) against any and all
\nDamages incurred by Buyer in connection with or arising or resulting from:<\/p>\n
(a) any breach by Seller of, or any other failure of Seller to
\nperform, any of its covenants, agreements or obligations in this Agreement or in
\nany Primary Ancillary Agreement;<\/p>\n
(b) the failure of any representation or warranty of Seller
\ncontained or referred to in this Agreement, any Primary Ancillary Agreement, or
\nany certificate delivered by or on behalf of Seller pursuant hereto or thereto
\nto have been true in all respects when made and as of the Closing Date unless
\nsuch representations and warranties are made only as of an earlier date, in
\nwhich case they shall be true and correct as of such earlier date; and<\/p>\n
(c) the Excluded Liabilities.<\/p>\n
7.2 Indemnification by Buyer. Subject to the limitations set forth in
\nthis Article VII, Buyer hereby agrees to indemnify and hold harmless Seller or
\nany of its Affiliates or any of their respective directors, officers, employees
\nor agents (collectively the “Seller Parties”) against any and all Damages
\nincurred by Seller in connection with or arising or resulting from:<\/p>\n
(a) any breach by Buyer of, or any other failure of Buyer to
\nperform, any of its covenants, agreements or obligations in this Agreement or in
\nany Primary Ancillary Agreement;<\/p>\n
(b) the failure of any representation or warranty of Buyer
\ncontained or referred to in this Agreement, any Primary Ancillary Agreement, or
\nany certificate delivered by or on behalf of Buyer pursuant hereto or thereto to
\nhave been true in all respects when made and as of the Closing Date unless such
\nrepresentations and warranties are made only as of an earlier date, in which
\ncase they shall be true and correct as of such earlier date; and<\/p>\n
(c) the Assumed Liabilities.<\/p>\n
7.3 Limitation on Indemnification Obligation. Notwithstanding the
\nforegoing, Seller shall not be required to indemnify the Buyer Parties under
\nSection 7.1(b) and Buyer shall not be required to indemnify the Seller Parties
\nunder Section 7.2(b), in each case until, and then only to the extent that, the
\naggregate amount of such Damages exceeds $10,000,000 and provided that the
\naggregate amount of Damages that either party shall be required to indemnify and
\nhold harmless pursuant to Section 7.1(b) or Section 7.2(b), as the case may be,
\nshall not exceed $82,500,000.<\/p>\n
21<\/p>\n
7.4 Survival. The representations and warranties of Buyer and Seller
\ncontained in this Agreement or any Primary Ancillary Agreement shall survive for
\na period of two years following the Closing Date, except (a) for the
\nrepresentations and warranties contained in the first sentence of Section
\n3.6(a), in Section 3.16 and in Section 4.8, which shall survive indefinitely,
\n(b) for the representations and warranties contained in Section 3.4, which shall
\nsurvive until the expiration of the applicable statute of limitations, and (c)
\nas specifically provided in the Primary Ancillary Agreements. Neither Seller nor
\nBuyer shall have any liability whatsoever with respect to any such
\nrepresentations or warranties after the survival period for such representation
\nor warranty expires, except for claims then pending or theretofore asserted in
\nwriting by a party in accordance with the terms and conditions of this
\nAgreement.<\/p>\n
7.5 Procedures for Indemnification. The indemnified party shall give
\nprompt written notice to the indemnifying party of any Claim by any Third Party
\nin respect of which indemnity may be sought, but a failure to give such notice
\nor delaying such notice shall not affect the indemnified party’s right to
\nindemnification and the indemnifying party’s obligation to indemnify as set
\nforth in this Agreement, except to the extent the indemnifying party’s ability
\nto remedy, contest, defend or settle with respect to such Claim is actually
\nprejudiced thereby. The obligations and liabilities of the parties with respect
\nto any such Claim shall be subject to the following additional terms and
\nconditions:<\/p>\n
(a) The indemnifying party shall have the right to undertake,
\nby counsel or other representatives of its own choosing, the defense or
\nopposition to such Claim.<\/p>\n
(b) In the event that the indemnifying party shall elect not
\nto undertake such defense or opposition, or, within thirty (30) days after
\nwritten notice (which shall include sufficient description of background
\ninformation explaining the basis for such Claim) of any such Claim from the
\nindemnified party, the indemnifying party shall fail to undertake to defend or
\noppose such Claim, the indemnified party (upon further written notice to the
\nindemnifying party) shall have the right to undertake the defense, opposition,
\ncompromise or settlement, subject to clause (c) below, of such Claim, by counsel
\nor other representatives of its own choosing, on behalf of and for the account
\nand risk of the indemnifying party (subject to the right of the indemnifying
\nparty to assume defense of or opposition to such Claim at any time prior to
\nsettlement, compromise or final determination thereof).<\/p>\n
(c) Anything herein to the contrary notwithstanding: (i) in
\nthe event that the indemnifying party undertakes defense of or opposition to any
\nClaim, (A) the indemnified party shall have the right, at its own cost and
\nexpense, to participate in the defense, opposition, compromise or settlement of
\nthe Claim and the indemnifying party and the indemnified party and their
\nrespective counsel or other representatives shall cooperate in good faith with
\nrespect to such Claim; and (B) the indemnifying party shall not, without the
\nindemnified party’s written consent (which consent shall not be unreasonably
\nwithheld), settle or compromise any Claim or consent to entry of any judgment in
\nrespect of such Claim; and (ii) in the event that the indemnified party
\nundertakes defense of or opposition to any Claim, (A) the indemnifying party
\nshall have the right, at its own cost and expense, to participate in the
\ndefense, opposition, compromise or settlement of the Claim and the indemnifying
\nparty and the indemnified party and their respective counsel or other
\nrepresentatives shall cooperate in good faith with respect to such <\/p>\n
22<\/p>\n
Claim; and (B) the indemnified party shall not, without the indemnifying party’s
\nwritten consent (which consent shall not be unreasonably withheld), settle or
\ncompromise any Claim or consent to entry of any judgment in respect of such
\nClaim.<\/p>\n
(d) All Claims not disputed shall be paid by the indemnifying
\nparty within thirty (30) days after receiving notice of the Claim. In the event
\nthere is a Disputed Claim with respect to any Damages, the indemnifying party
\nshall be required to pay the indemnified party the amount of such Damages for
\nwhich the indemnifying party has, pursuant to a final determination, been found
\nliable within ten (10) days after there is a final determination with respect to
\nsuch Disputed Claim. A final determination of a Disputed Claim shall be (i) a
\njudgment of any court of competent jurisdiction determining the validity of a
\nDisputed Claim, if no appeal is pending from such judgment and if the time to
\nappeal therefrom has elapsed; (ii) an award of any arbitration determining the
\nvalidity of such disputed claim, if there is not pending any motion to set aside
\nsuch award and if the time within which to move to set aside such award has
\nelapsed; (iii) a written termination of the dispute with respect to such claim
\nsigned by the parties thereto or their attorneys; (iv) a written acknowledgment
\nof the indemnifying party that it no longer disputes the validity of such claim;
\nor (v) such other evidence of final determination of a disputed claim as shall
\nbe acceptable to the parties. No undertaking of defense or opposition to a Claim
\nshall be construed as an acknowledgment by such party that it is liable to the
\nparty claiming indemnification with respect to the Claim at issue or other
\nsimilar Claims.<\/p>\n
(e) Any amounts payable under this Article VII by the
\nindemnifying party to or on behalf of the indemnified party in respect of any
\nDamages shall be reduced to the extent that the indemnified party receives any
\ninsurance proceeds with respect to a Claim. If the amount of any Claim, at any
\ntime subsequent to the making of an indemnity payment in respect thereof, is
\nreduced by recovery, settlement or otherwise under or pursuant to any insurance
\ncoverage, or pursuant to any claim, recovery, settlement or payment by or
\nagainst any Third Party, the amount of such reduction, less any costs, expenses
\nor premiums incurred in connection therewith, will promptly be repaid by the
\nindemnified party to the indemnifying party with respect to such Claim.<\/p>\n
7.6 Ancillary Agreements. The provisions of this Article VII shall be
\nwithout limitation of the parties’ rights to indemnification under or other
\nremedies specifically provided for under the Ancillary Agreements.<\/p>\n
ARTICLE VIII<\/p>\n
COVENANTS<\/p>\n
8.1 Operation of the Business. Seller covenants and agrees that
\nduring the period from the date of this Agreement to the Closing (except as
\nBuyer otherwise has consented in writing, which consent will not be unreasonably
\nwithheld), the business and operation of the Group and the Premises will be
\nconducted only in the ordinary course of business, consistent with past
\npractices, and Seller shall use commercially reasonable efforts to preserve the
\nbusiness and operations of the Group intact, and to preserve the goodwill of
\ncustomers and suppliers of the Group. During the period from the date of this
\nAgreement through the Closing, Seller shall <\/p>\n
23<\/p>\n
not, with respect to the Acquired Assets, the Assumed Liabilities or the Group,
\nwithout the prior written consent of Buyer, which consent will not be
\nunreasonably withheld:<\/p>\n
(a) cancel or waive, or agree to cancel or waive, any debt, claim or
\n right (absolute or contingent), having a value or potential value
\n (individually or in the aggregate) in excess of $500,000;<\/p>\n
(b) make any capital expenditure, capital commitment, additions to
\n property, plant or equipment in excess of the amounts set forth in
\n the Capital Acquisition Report attached hereto as Schedule 8.1(b);<\/p>\n
(c) take any action which individually or in the aggregate is
\n reasonably expected to have a Material Adverse Effect on the
\n Group’s business relationship with any major customer or supplier;<\/p>\n
(d) sell, lease, license or otherwise dispose of, or agree to sell,
\n lease, license or otherwise dispose of, any interest in any of the
\n Acquired Assets, except for (i) sales of Inventory in the ordinary
\n course of business and (ii) the sale or disposal of excess and
\n obsolete assets in the ordinary course of business in compliance
\n with Group policies and practices and in an amount not to exceed
\n $100,000 per month;<\/p>\n
(e) increase in any manner the compensation of, or enter into any new
\n bonus or incentive agreements or arrangements with, or establish
\n any new employee benefit plans or programs for, or increase the
\n benefits under any existing employee benefit plan or program for,
\n any employees of the Group other than in connection with a
\n promotion, in the ordinary course of business (including any such
\n changes that are not related to the transactions contemplated by
\n this Agreement and that are generally applicable to all similarly
\n situated Seller or Seller Affiliate employees), or as expressly
\n provided for in the Employee Matters Agreement or any agreements
\n forming a part thereof;<\/p>\n
(f) enter into a lease of real property with respect to the business or
\n operations of the Group having annual lease payments in excess of
\n $500,000;<\/p>\n
(g) change with respect to the business or operation of the Group its
\n accounting methods, principles or policies in any material respect
\n except to the extent required by GAAP, applicable Law, or the
\n United States Government;<\/p>\n
(h) make any Tax election that could carry over to Buyer and have a
\n Material Adverse Effect after the Closing;<\/p>\n
(i) make any change to the revenue recognition procedures as used in
\n the preparation of the Financial Statements;<\/p>\n
(j) amend in any material adverse respect any Contract except with
\n respect to the settlement of a debt, claim or right in accordance
\n with Section 8.1(a);<\/p>\n
24<\/p>\n
(k) pay, distribute, loan or advance any amount received in connection
\n with or related to advance payments or deposits on Contracts to any
\n stockholder, officer, employee, director or Affiliate, except as
\n otherwise contemplated by this Agreement or the Ancillary
\n Agreements;<\/p>\n
(l) (i) delay or postpone payment on, or otherwise alter the payment
\n terms of, Accounts Payable other than consistent with past
\n practices, (ii) factor, discount or otherwise accept less than full
\n payment with regard to, or accelerate the collection of, Accounts
\n Receivable or other amounts due other than in the ordinary course
\n of business, (iii) offer or extend any special discounts or terms
\n on the sale of Inventory, except in the ordinary course of
\n business, or (iv) sell any Inventory at less than fair market value
\n or make any bulk sale of Inventory other than in the ordinary
\n course of business;<\/p>\n
(m) incur or assume any indebtedness or other liabilities (whether
\n absolute, accrued, contingent or otherwise) or guarantee any such
\n indebtedness or commitments for the same, except liabilities (other
\n than indebtedness or guarantees of indebtedness) in the ordinary
\n course of business, and in amounts and on terms consistent with
\n past practice;<\/p>\n
(n) take any other action which individually or in the aggregate
\n materially affects the Financial Statements outside the ordinary
\n course of business consistent with past practice; or<\/p>\n
(o) commit or agree to do any of the foregoing.<\/p>\n
8.2 Access.. From the date hereof through the Closing Date, Seller
\nshall give Buyer and its representatives access during normal business hours and
\nunder reasonable circumstances to all properties and records of the Group,
\nsubject to the terms and conditions as may be required by the landlords under
\nthe Assumed Real Property Leases. Seller shall furnish Buyer with all financial
\nand other information in its possession relating to the Group, the Acquired
\nAssets and the Assumed Liabilities as Buyer may from time to time reasonably
\nrequest. At the request of Buyer and after the public announcement of the
\ntransactions contemplated hereby in accordance with this Agreement, Seller shall
\narrange joint visits to significant customers and suppliers of the Group. Buyer
\nshall not communicate with any employee customer, supplier, landlord or tenant
\nof the Group without the prior consent (written or oral) of Seller’s Senior Vice
\nPresident\/Director of Finance (Bob Kell), Seller’s Corporate Vice
\nPresident\/General Manager (Bob McCall), Ralph Smith or Michelle Warner. All
\nrights of access to information and documents granted under this Section 8.2 are
\nsubject to restrictions on access to classified facilities and information
\nimposed by Governmental Authorities.<\/p>\n
8.3 Cooperation; Records and Documents.<\/p>\n
(a) In the event and for so long as either party is actively
\ncontesting or defending against any Proceeding in connection with (i) any
\ntransaction contemplated under this Agreement or the Ancillary Agreements or
\n(ii) any fact, situation, circumstance, status, condition, activity, practice,
\nplan, occurrence, event, incident, action, failure to act or transaction on or
\nprior to the Closing Date involving the Group, the other party shall cooperate
\nwith the <\/p>\n
25<\/p>\n
contesting or defending party and its counsel in the contest or defense, make
\navailable its personnel and provide such testimony and access to its books and
\nrecords as may be necessary in connection with the contest or defense, at the
\nsole cost and expense of the contesting or defending party (unless the
\ncontesting or defending party is entitled to indemnification therefor under
\nArticle VII or such costs and expenses are allocated differently under Sections
\n8.3(c)-(e)). The provisions of this Section 8.3(a) shall not be applicable in
\nthe case of any Proceeding by one party to this Agreement against the other.<\/p>\n
(b) Following the Closing Date, Seller shall grant to Buyer
\nand its representatives, at Buyer’s reasonable request (subject to any
\nlimitations that are reasonably required to preserve any applicable privilege or
\nThird Party confidentiality obligation), reasonable access during normal
\nbusiness hours and under reasonable circumstances to, and the right to make
\ncopies at Buyer’s sole expense of, those records and documents in Seller’s
\npossession related to the Group, the Acquired Assets or the Assumed Liabilities
\nas may be reasonably necessary for Buyer’s operation of the Group after the
\nClosing. Following the Closing Date, Buyer shall grant to Seller and its
\nrepresentatives, at Seller’s reasonable request (subject to any limitations that
\nare reasonably required to preserve any applicable privilege or Third Party
\nconfidentiality obligation), access during normal business hours and under
\nreasonable circumstances to, and the right to make copies at Seller’s sole
\nexpense of, those records and documents covering any period prior to the Closing
\nrelated to the Group or the Acquired Assets as may be reasonably necessary for
\nlitigation, preparation of financial statements, tax returns and audits or other
\nvalid business purposes. If Buyer elects to dispose of any of such records
\nwithin six (6) years after the Closing Date, Buyer shall first give Seller sixty
\n(60) days’ written notice, during which period Seller shall have the right to
\ntake such records without payment of consideration. All rights of access to
\ninformation and documents granted under this Section 8.3 are subject to
\nrestrictions on access to classified facilities and information imposed by
\nGovernmental Authorities.<\/p>\n
(c) In addition to the provisions of Sections 8.3(a) and (b),
\nBuyer and Seller shall fully cooperate in connection with (i) Seller’s defense
\nof the ongoing investigation relating to the FMU-140 contract, (ii) Seller’s
\ndefense in any other Proceedings involving allegations of pre-Closing criminal
\nconduct or civil fraud, (iii) Seller’s actions in connection with any other
\nProceeding for which Seller has retained liability under this Agreement, the
\nAncillary Agreements or any other agreement referenced or contemplated hereby or
\nthereby and (iv) Seller’s prosecution of affirmative claims relating to the
\nFMU-140 contract; provided that such cooperation shall not be applicable in the
\ncase of any Proceeding by a party to this Agreement against the other party. It
\nis understood and agreed by Buyer and Seller that (y) Buyer’s cooperation
\nhereunder is predicated on Seller’s performance under this Agreement and the
\nAncillary Agreements of its obligations to Buyer in respect of the Excluded
\nLiabilities and nothing contained in this Section 8.3(c) shall be construed to
\nlimit Buyer’s rights in the event of Seller’s non-performance and (z) Buyer’s
\ncooperation under this Section 8.3(c) is not intended to require it to engage in
\nactivities where Buyer, in the exercise of its reasonable judgment, would be
\nrequired to engage outside counsel or other professionals.<\/p>\n
(d) In connection with the cooperation specified in Section
\n8(c), each of Buyer and Seller shall (i) designate (A) a senior management point
\nof contact who shall be responsible <\/p>\n
26<\/p>\n
for oversight of such party’s cooperation obligations hereunder and (B) an
\noperational level point of contact who shall be responsible for day-to-day
\ncoordination in connection with Seller’s investigation or prosecution
\nactivities, (ii) enter into joint defense agreements where appropriate in form
\nand substance mutually acceptable to Buyer and Seller and (iii) otherwise fully
\ncooperate to the extent necessary to permit Seller to vigorously defend itself
\nand, to the extent applicable, Buyer in such Proceedings. In addition, Buyer
\nshall (x) provide appropriate on-site working space as necessary for Seller’s
\ninvestigative and legal personnel equipped with or with access to appropriate
\ncommunications and copying equipment, (y) ensure the retention of documents
\nrelevant to Seller’s investigation in accordance with the provisions of Section
\n8.3(b), subject to the cost provisions of Section 8.3(e), and (z) make
\nreasonably available to Seller such employees of Buyer as have relevant
\nknowledge or expertise to assist Seller in resolving those matters referred to
\nin Sections 8.3(c)(i)-(iv). Seller shall not settle any Proceeding described in
\nSection 8.3(c) that is initiated by a Governmental Authority without the express
\nwritten consent of Buyer, which consent shall not be unreasonably withheld, if
\nsuch settlement requires Buyer to take, or prohibits Buyer from taking, any
\naction.<\/p>\n
(e) With respect to the costs of any Proceeding described in
\nSections 8.3(c)(i)-(iv), (1) Seller shall bear all of its own costs and shall
\nreimburse Buyer for all of its reasonable out-of-pocket expenses related to the
\nProceeding (which shall not include the fees and expenses of Buyer’s counsel
\nunless otherwise agreed to by Seller) and (2) Buyer shall bear all of its own
\ninternal costs of cooperation.<\/p>\n
(f) Seller’s February 16, 1996 Advance Agreement with the
\nUnited States Government Regarding Environmental Litigation Costs and May 13,
\n1998 Advance Agreement with the United States Government for Environmental
\nRemediation Costs (the “Advance Agreements”) are scheduled Excluded Liabilities.
\nTo the extent the United States Government asserts any rights or claims it may
\nhave under the Advance Agreements by issuance of a contracting officer’s final
\ndecision under a contract novated or to be novated pursuant to this Agreement,
\nBuyer agrees to enter into a sponsorship agreement or other similar arrangement
\nunder which Seller will have the right to appeal in the name of Buyer the final
\ndecision to a final resolution. Any such appeals will be at Seller’s risk and
\nexpense, and the parties will cooperate as contemplated in Sections 8(a) and (b)
\nin connection with any appeals.<\/p>\n
8.4 Novation of Government Contracts. Promptly following the Closing,
\nSeller shall, in accordance with, and to the extent required by, the Federal
\nAcquisition Regulation Part 42, Subpart 42.12, submit in writing to each
\nresponsible contracting officer a request for the United States Government to:
\n(a) recognize Buyer as the successor in interest to all of the Government
\nContracts; and (b) enter into a novation agreement (the “Novation Agreement”)
\nsubstantially in the form contemplated by such regulations. Seller shall use
\nreasonable commercial efforts to obtain all consents, approvals and waivers
\nrequired for the purpose of processing, entering into and completing the
\nNovation Agreements with regard to the Government Contracts, including
\nresponding promptly to any request for information by the United States
\nGovernment with regard to such Novation Agreements. Following the Closing,
\nBuyer, who is likely to be in the better position to respond to inquiries from
\nthe United States Government concerning such Novation Agreements, shall use
\nreasonable commercial efforts to provide all information and take all other
\nactions necessary to execute and consummate such Novation Agreements, including
\nresponding <\/p>\n
27<\/p>\n
promptly to any request for information by the United States Government with
\nregard to such Novation Agreements. Such Government information requests may
\ninclude, without limitation: (i) a list of all affected contracts between Seller
\nand the Government in accordance with FAR 42.1204(e)(2); (ii) evidence of the
\nBuyer’s capability to perform; (iii) balance sheets of the Buyer as of the dates
\nimmediately before and after the transfer of assets, audited by independent
\naccountants; (iv) evidence that any security clearance requirements have been
\nmet; (v) the consent of sureties, if any, of all contracts listed under
\nsubparagraph (i) above; and (vi) information, if any, identifying and evaluating
\nany potentially significant Organizational Conflicts of Interest as contemplated
\nunder FAR 42.1204(d).<\/p>\n
8.5 Assignment of Contracts.<\/p>\n
(a) Anything in this Agreement to the contrary
\nnotwithstanding, this Agreement shall not constitute an agreement to assign or
\notherwise sell, convey or transfer any Contract, or any claim, right or benefit
\narising thereunder or resulting therefrom, or to enter into any other agreement
\nor arrangement with respect thereto, if an attempted assignment, sale,
\nconveyance or transfer thereof, or entering into any such agreement or
\narrangement, without the consent of a Third Party, would constitute a breach
\nthereof, or other contravention thereunder, be ineffective with respect to any
\nparty thereto or in any way adversely affect the rights of Seller or Buyer
\nthereunder; provided, however, that at such time, if any such Contract may be so
\nassigned, sold, conveyed or transferred without having any of the foregoing
\nconsequences, such Contract shall be so assigned, sold, conveyed and
\ntransferred. With respect to any such Contract as to which the consent of a
\nThird Party is necessary, or any claim, right or benefit arising thereunder or
\nresulting therefrom, promptly after the date hereof, Seller and Buyer will use
\ncommercially reasonable efforts, which shall not require the expenditure of any
\nmoney by Seller or Buyer, to obtain the written consent of other parties to any
\nsuch Contract for the sale, transfer or assignment thereof to Buyer, or written
\nconfirmation from such parties reasonably satisfactory in form and substance to
\nSeller and Buyer confirming that such consent is not required.<\/p>\n
(b) Until such consent is obtained with respect to any such
\nContract, Seller and Buyer will cooperate to establish an arrangement (including
\nthrough a subcontracting, subleasing, sublicensing or similar arrangement to the
\nextent not prohibited under such Contract) effective as of the Closing Date
\nreasonably satisfactory to Buyer and Seller under which Buyer would obtain, to
\nthe maximum extent possible, the claims, rights and benefits of Seller under
\nsuch Contract, with reasonable costs and expenses of Seller and its Affiliates
\nrelated thereto to be promptly reimbursed by Buyer. Seller will enforce, at the
\nreasonable request of and for the benefit of Buyer, any and all claims, rights
\nand benefits of Seller against any Third Party thereto arising from any such
\nContract (including the right to elect to terminate such Contract in accordance
\nwith the terms thereof upon the request of Buyer). To the extent permitted by
\napplicable Law and the terms of any Contract not assigned pursuant to this
\nSection 8.5, Buyer will use its commercially reasonable efforts to perform the
\nobligations under each such Contract for the benefit of Seller and the other
\nparty or parties thereto in accordance with the arrangement established with
\nSeller and will indemnify and hold Seller and its Affiliates harmless from any
\nDamages relating to, resulting from or arising out of any failure by Buyer so to
\nperform or pay.<\/p>\n
28<\/p>\n
(c) Seller will promptly pay to Buyer, when received, all
\nmonies received by Seller under any Contract or any claim, right or benefit
\narising under any such Contract not assigned pursuant to Section 8.5(a), less
\nany actual out-of-pocket costs or expenses incurred by Seller as a result of
\nreceiving such monies.<\/p>\n
(d) At the request of Seller, Buyer shall use commercially
\nreasonable efforts to assist Seller in seeking the unconditional release of
\nSeller from any and all obligations or liabilities under or in respect of any
\nContract, Assumed Lease or Government Proposal constituting an Acquired Asset.<\/p>\n
(e) The obligations of Buyer and Seller with respect to
\nContracts the assignment of which requires the consent of a Third Party shall be
\nsubject to the further provisions set forth on Schedule 8.5(e).<\/p>\n
8.6 Confidentiality.<\/p>\n
(a) Each party hereby agrees that, except as required by
\napplicable Law, it will not disclose, nor will it permit any of its employees,
\nagents or representatives to disclose, to any Third Party any confidential
\ninformation obtained from the other party in connection with the transactions
\ncontemplated hereby, this Agreement, the Ancillary Agreements, or the fact that
\ndiscussions regarding such transactions are taking place or that this Agreement
\nhas been executed without the prior consent of the other party. If this
\nAgreement is terminated without consummation of the transactions contemplated
\nhereunder, promptly after termination, each party shall destroy or return to the
\nother party all such confidential information, including any copies, extracts or
\nother reproductions in whole or in part. Such return or destruction shall be
\ncertified in writing to each party by an authorized officer of the other party.
\nThe provisions of this Section 8.6(a) shall survive any termination of this
\nAgreement.<\/p>\n
(b) Seller agrees that from and after the Closing Date it
\nshall, and shall cause its directors, officers, employees, advisors and
\nAffiliates to, keep the Group Confidential Information (as defined below)
\nconfidential for a period of five (5) years from the Closing Date, except that
\nany Group Confidential Information may be disclosed if such disclosure is (i)
\nrequired by law or any regulatory body; provided however that Seller shall first
\nhave given notice to Buyer and reasonably cooperated with Buyer with respect to
\nBuyer’s efforts to obtain a protective order with respect to the Group
\nConfidential Information required to be disclosed; or (ii) necessary to
\nestablish rights under this Agreement. For purposes hereof, the term “Group
\nConfidential Information” means all information that relates to the Acquired
\nAssets or the Assumed Liabilities, other than any such information that (i) is
\navailable to the public on the Closing Date, or thereafter becomes available to
\nthe public other than as a result of a breach of this Section 8.6; (ii) is
\ndisclosed by Buyer to a Third Party without an obligation of confidence; (iii)
\ncan be shown by Seller to have been developed by it completely independently of
\nthe Group; or (iv) can be shown by Seller to have been rightfully received
\ncompletely independently from a third party without any obligation of
\nconfidence.<\/p>\n
(c) Buyer agrees that from and after the Closing Date it
\nshall, and shall cause its directors, officers, employees, advisors and
\nAffiliates to, keep the Seller Confidential Information (as defined below)
\nconfidential for a period of five (5) years from the Closing Date, <\/p>\n
29<\/p>\n
except that any Seller Confidential Information may be disclosed if such
\ndisclosure is (i) required by law or any regulatory body; provided however that
\nBuyer shall first have given notice to Seller and reasonably cooperated with
\nSeller with respect to Seller’s efforts to obtain a protective order with
\nrespect to Seller Confidential Information required to be disclosed; or (ii)
\nnecessary to establish rights under this Agreement. For purposes hereof, the
\nterm “Seller Confidential Information” means all information of Seller and its
\nAffiliates that relates to the Excluded Assets or the Excluded Liabilities and
\nprovided to Buyer in connection with the transactions contemplated by this
\nAgreement or otherwise in Buyer’s (including the Group’s) possession from and
\nafter the Closing, other than any such information that (i) is available to the
\npublic on the Closing Date, or thereafter becomes available to the public other
\nthan as a result of a breach of this Section 8.6; (ii) is disclosed by Seller to
\na Third Party without an obligation of confidence; (iii) can be shown by Buyer
\nto have been developed by it completely independently of Seller; or (iv) can be
\nshown by Buyer to have been rightfully received completely independently from a
\nthird party without any obligation of confidence.<\/p>\n
(d) Each party shall notify the other party promptly upon
\ndiscovery of any unauthorized use or disclosure of the other party’s
\nConfidential Information, and will cooperate with the other party in every
\nreasonable way to help the other party regain possession of such Confidential
\nInformation and to prevent its further unauthorized use. For these purposes,
\n“Confidential Information” shall mean Group Confidential Information or Seller
\nConfidential Information, as applicable.<\/p>\n
8.7 Filings and Authorizations. Seller and Buyer shall, as promptly
\nas practicable after the date hereof, file or supply, or cause to be filed or
\nsupplied, or will make, or cause to be made, the following:<\/p>\n
(a) All notifications and information required to be filed
\nor supplied pursuant to the HSR Act (including any request for additional
\ninformation or production of personnel for administrative interviews made
\npursuant to the HSR Act) and all information or interviews reasonably requested
\nby state officials in connection with the sale and transfer of the Acquired
\nAssets; and<\/p>\n
(b) All such other filings and submissions under Laws
\napplicable to it as may be required for it to consummate the transactions
\ncontemplated by this Agreement.<\/p>\n
(c) Each of Buyer and Seller shall immediately inform the
\nother party of any communication from any governmental authority in connection
\nwith the filings made by the parties and any review of such filings and the
\ntransactions contemplated by this Agreement conducted by such authority pursuant
\nto the HSR Act or such other similar foreign Law.<\/p>\n
8.8 Notification of Breach. Each party shall promptly notify the
\nother party in writing of (i) the occurrence, or failure to occur, of any event
\nwhere such occurrence or failure is reasonably expected to cause any of such
\nparty’s representations or warranties contained in this Agreement to be untrue
\nor inaccurate in any material respect or (ii) any material failure of such party
\nto comply with or satisfy any of its covenants, conditions or agreements to be
\ncomplied with or satisfied by it under this Agreement; provided, however, that
\nsuch disclosure shall not be <\/p>\n
30<\/p>\n
deemed to cure any breach of a representation, warranty, covenant or agreement
\nor to satisfy any condition.<\/p>\n
8.9 Post-Closing Refunds. If Seller receives any refund (including
\nwithout limitation any refund for Taxes) relating to the business or operations
\nof the Group for periods prior to the Closing Date and the liability to which
\nsuch refund relates was included as a cost in a cost-reimbursement or
\nfixed-price incentive (cost-redeterminable) Government Contract, then Seller
\nshall cooperate with Buyer to determine the appropriate portion of such refund
\ndue to any Governmental Authority as if Buyer had pursued and obtained an
\nidentical refund. Once the appropriate portion due any Governmental Authority is
\ndetermined, Seller shall promptly remit to Buyer such amount to be paid to such
\nGovernmental Authority in an appropriate manner to be determined by Buyer. If
\nBuyer is liable for any Taxes (net of any Tax benefit to Buyer in making payment
\nto the Governmental Authority) as a result of such reimbursement by Seller,
\nSeller shall also pay to Buyer such additional amounts required to pay such
\nTaxes including any Tax on such payment.<\/p>\n
8.10 Noncompetition Agreement.<\/p>\n
(a) Seller agrees that, during the five-year period
\ncommencing on the Closing Date, it shall not and shall not cause or permit any
\nof its Affiliates to, directly or indirectly, engage in any activities which
\ncompete with the business or operation of the Group, anywhere in the world, for:
\n(i) the programs for which the Group has been awarded a Contract as of the
\nClosing Date, or for which the Group has submitted a bid or proposal as of the
\ndate of this Agreement (which has not expired, been withdrawn or awarded to a
\nthird-party); (ii) any extensions of such programs or follow-ons directly
\nderived from such programs; (iii) any contract subject to Cost Accounting
\nStandards (“CAS”) coverage; (iv) any U.S. governmental military, defense or NASA
\nprogram; and (v) any program to provide space-borne equipment to a Governmental
\nAuthority. The foregoing activities are referred to in this Agreement
\ncollectively as “Seller Competitive Activities.”<\/p>\n
(b) Notwithstanding the foregoing, the provisions of Section
\n8.10(a) shall not prohibit Seller or any of its subsidiaries from:<\/p>\n
(i) providing components, products or services under any
\n contract (other than any Government Contract) with (A)
\n the United States Government (acting on its own behalf
\n or on behalf of another country or international
\n organization), (B) any prime contractor performing under
\n a prime contract with the United States Government, (C)
\n any subcontractor performing under a prime contract with
\n the United States Government, or (D) any foreign
\n government (a “Non-IISG Government Contract”) to which
\n Seller or any of its subsidiaries is a party as of the
\n date of this Agreement or under any bid or proposal with
\n respect to any Non-IISG Government Contract that was
\n submitted as of the date of this Agreement (which has
\n not expired, been withdrawn or awarded to a third party)
\n and any extensions or follow-ons directly derived from
\n programs to which such Non-IISG Government Contracts
\n relate; or<\/p>\n
31<\/p>\n
(ii) selling or otherwise providing commercial items (as
\n defined in FAR 2.101 as of January 1, 2001) or services
\n related solely to Seller commercial items (“Related
\n Services”) (including, without limitation, the following
\n products that meet the definition of commercial item
\n and\/or Related Services: wireline or wireless telephony,
\n two-way radios, infrastructure equipment, network
\n management, paging, equipment maintenance, systems
\n integration services, data systems, voice processing or
\n commercial items or Related Services premised upon
\n packet switching or cell-based technologies (including
\n Internet protocols and security services)), including,
\n without limitation, those commercial items and Related
\n Services offered by Seller’s Commercial, Government,
\n Industrial Solutions Sector, which delivers integrated
\n communication and information solutions for work teams
\n in business and government; or<\/p>\n
(iii) engaging in the business of designing, manufacturing or
\n selling semiconductor components; or<\/p>\n
(iv) engaging in business conducted by a business unit
\n currently within the Motorola Corporate Technology
\n Office and currently subject to modified CAS coverage,
\n provided such business does not exceed $50,000,000.00 in
\n revenue in any Seller fiscal year; or<\/p>\n
(v) competing for awards and providing components, products
\n or services under any order issued under the Army’s Base
\n Radio Systems contract; or<\/p>\n
(vi) competing for awards and providing components, products
\n or services under any law enforcement or public safety
\n contracts subject to CAS coverage, provided that such
\n contracts are not with the U.S. Department of Defense,
\n or a component thereof.<\/p>\n
(c) Notwithstanding the provisions of Section 8.10(a), the
\nacquisition (by asset purchase, stock purchase, merger, consolidation or
\notherwise) by Seller or any of its Affiliates of the stock, business or assets
\nof any Person that at the time of such acquisition is engaged in Seller
\nCompetitive Activities, and the continuation of such Seller Competitive
\nActivities following such acquisition, shall not be in breach of the terms of
\nthis Section 8.10 if: (i) the portion of the revenues of such Person and its
\nsubsidiaries on a consolidated basis for the fiscal year ending prior to the
\ndate of such acquisition that is attributable to Seller Competitive Activities
\nby such Person and its subsidiaries (“Seller Competitive Revenues”) account for
\nless than 20 percent of the revenues of such Person and its subsidiaries on a
\nconsolidated basis for such fiscal year; or (ii) in the event the foregoing
\ncondition is not satisfied, Seller offers, or cause its Affiliates to offer the
\nportion of such business or assets that represents Seller Competitive Activities
\nto Buyer and negotiates in good faith with Buyer as to the terms and conditions
\nof Buyer’s purchase of such business and assets, provided that (A) if Buyer
\nnotifies Seller in writing that it is unwilling to purchase such business or
\nassets, or (B) if following such good faith negotiations, the parties are unable
\nto reach agreements on the terms of such a purchase, Seller <\/p>\n
32<\/p>\n
promptly uses its reasonable efforts to sell such business or assets, including,
\nwithout limitation, by actively marketing the business or assets on commercially
\nreasonable terms.<\/p>\n
(d) Nothing in this Section 8.10 will restrict or prevent
\nSeller or any of its subsidiaries from maintaining and\/or undertaking passive
\ninvestments in Persons primarily engaged in the Seller Competitive Activities so
\nlong as the aggregate interest represented by such investments does not exceed
\n(i) 5% of any class of the outstanding debt or equity securities of any such
\nPerson, in the case of a Person whose shares are listed on a national securities
\nexchange or the NASDAQ National Market System or equivalent foreign exchange or
\nquotation system or (ii) 5% of any class of the outstanding equity or debt
\nsecurities in the case of any other Person;<\/p>\n
(e) If the final judgment of a court of competent
\njurisdiction declares that any term or provision of this Section 8.10 is invalid
\nor unenforceable, the parties agree that the court making the determination of
\ninvalidity or unenforceability shall have the power to reduce the scope,
\nduration or area of the term or provision, to delete specific words or phrases
\nor to replace any invalid or unenforceable term or provision with a term or
\nprovision that is valid and enforceable and that comes closest to expressing the
\nintention of the invalid or unenforceable term or provision and this Agreement
\nshall be enforceable as so modified. Seller acknowledges that Buyer would not
\nhave an adequate remedy at law in the event of the violation of this Section
\n8.10 and that the scope, duration and area restrictions on Seller’s activities
\nprovided by this Section 8.10 are fair and reasonably required for the
\nprotection of Buyer and its Affiliates. Therefore, in addition to any other
\nremedies which Buyer may have under this Agreement or otherwise, Buyer shall be
\nentitled to apply to any court of competent jurisdiction for an injunction
\nrestraining Seller from committing or continuing any violation of this Section
\n8.10 without the requirement of posting any bond or other indemnity.<\/p>\n
8.11 Real Property Matters<\/p>\n
(a) From and after the date hereof, Seller agrees to
\ncooperate with Buyer and to provide Buyer’s employees, agents and
\nrepresentatives with access to the Premises for purposes of performing such
\ninspections, tests and surveys of the Premises as Buyer reasonably determines
\nare necessary in connection with the transactions contemplated by this
\nAgreement. Prior to performing any such inspections, tests and surveys of the
\nPremises, Buyer shall obtain Seller’s consent to each such procedure. Such
\ninspections, tests and surveys of the Leased Premises shall be conducted only
\nafter Seller obtains the consent of Seller and Seller obtains the consent of the
\nrespective landlords of the Leased Premises.<\/p>\n
(b) Seller has delivered to Buyer a current title commitment
\n(the “Title Commitment”) from a title insurance company reasonably acceptable to
\nBuyer (the “Title Company”) with respect to the Owned Premises. If the Title
\nCommitment discloses any Lien other than a Permitted Lien (each, an “Unpermitted
\nLien”), Seller shall remove, or cause to be removed, all Unpermitted Liens or,
\nin the alternative, obtain title insurance in a form reasonably satisfactory to
\nBuyer insuring over all of such Unpermitted Liens.<\/p>\n
(c) Within fourteen (14) days after the execution and
\ndelivery of this Agreement, Seller will deliver to Buyer a current survey (the
\n“Survey”) of the Owned Premises certified to Buyer and the Title Company,
\nprepared by a licensed surveyor and conforming to the <\/p>\n
33<\/p>\n
current ALTA\/ACSM Minimum Standard Detail Requirements for Land Title Surveys,
\ndisclosing the location of all improvements, easements, roadways, utility lines
\nand other matters customarily shown on such surveys (including such Table A
\nitems as Buyer may reasonably request). The Survey shall affirmatively show that
\nthe Owned Premises has access to publicly dedicated streets and shall otherwise
\nbe reasonably acceptable to Buyer. The costs and expenses incurred in connection
\nwith the Survey will be shared equally by Seller and Buyer.<\/p>\n
(d) On or before the Closing, Seller shall use commercially
\nreasonable efforts to obtain an estoppel agreement in form and substance
\nreasonably satisfactory to Buyer from the landlords under the Assumed Real
\nProperty Leases for the Leased Premises designated on Schedule 8.11(d). Buyer
\nacknowledges that certain of the Assumed Real Property Leases do not contain
\nclauses requiring the respective landlords to provide such estoppel agreements.<\/p>\n
8.12 Settlement of Indirect Expense Rates. Schedule 8.12 sets forth
\n(1) the indirect expense billing rates by cost pool that have been or are being
\nused by Seller for the novated flexibly-priced contracts of the Group for the
\ncontractor’s fiscal years not yet settled with the United States Government
\n(“Open Years”); (2) for each of such Open Years, the allocation base for novated
\nflexibly-priced contracts to which indirect expense billing rates were or are
\nbeing applied (the “Allocation Base”); and (3) for each Open Year the reserves
\nestablished by the Group for final indirect expense billing rate adjustments.<\/p>\n
(a) With respect to Seller’s corporate office expenses or
\nother indirect costs of Seller allocated to the Group (“Seller’s Corporate
\nAllocation”) for Open Years (through the Closing Date), Seller will be
\nresponsible for the resolution of all matters relating to the allowability or
\nallocation of Seller’s Corporate Allocation and the negotiation and settlement
\nof final allowable expenses with the United States Government. Seller shall seek
\nsuch settlements diligently and in good faith, and Seller shall not settle any
\nsuch Seller’s Corporate Allocation matter without the consent of Buyer, which
\nconsent shall not be unreasonably withheld.<\/p>\n
(b) With respect to the indirect expenses of the Group and
\nits divisions (“Group Indirect Expenses”) for Open Years, Buyer will be
\nresponsible for the resolution of all matters relating to the allowability or
\nallocation of Group Indirect Expenses and the negotiation and settlement of
\nfinal allowable expenses with the United States Government. Buyer shall seek
\nsuch settlements diligently and in good faith, and Buyer shall not settle any
\nsuch Group Indirect Expense matter without the consent of Seller, which consent
\nshall not be unreasonably withheld.<\/p>\n
(c) Buyer and Seller recognize and agree that, as to those
\nflexibly-priced contracts that are novated to Buyer, Buyer shall be responsible,
\nas a result of any final adjustments to provisional billing rates for Open Years
\nfor Seller’s Corporate Allocation and Group Indirect Expenses, for refunding to
\nthe United States Government (or higher tier contractor) any amounts due, or
\nrendering an invoice to the United States Government (or higher tier contractor)
\nfor any additional billings. In the event the final rates negotiated with the
\nUnited States Government are lower than the rates set forth in Schedule 8.12,
\nSeller shall promptly reimburse Buyer for the difference, but only to the extent
\nthat such difference exceeds the reserves for regular rate negotiations
\nestablished by the Group as of the Closing Date to address such differences. In
\nthe event the final rates negotiated with the United States Government are<\/p>\n
34<\/p>\n
higher than the rates set forth in Schedule 8.12, Buyer shall diligently pursue
\nrecovery of and promptly reimburse Seller for the difference, assuming the
\nadditional billings are within the funded value of the contract and Buyer is
\nactually able to recover such additional costs. For purposes of this clause (c),
\nthe dollar amount of the difference between provisional and final billing rates
\nfor each Open Year will be determined, for each billing rate identified in
\nSchedule 8.12, (1) by the application of the difference between provisional and
\nfinal billing rates to the respective allocation base identified in Schedule
\n8.12 and (2) by the allocation of such product to individual contracts. An
\nunderrun of one rate may be used to offset an overrun of another rate within the
\nsame year.<\/p>\n
8.13 Additional Discounts. Seller will extend an additional 8%
\ndiscount on non-GSA schedule products sold to Buyer under the Joint Pursuit
\nTeaming Agreement (U.S. Coast Guard).<\/p>\n
ARTICLE IX<\/p>\n
TERMINATION<\/p>\n
9.1 Termination of Agreement. Notwithstanding anything contained in
\nthis Agreement to the contrary, this Agreement may be terminated and abandoned
\nat any time prior to the Closing:<\/p>\n
(a) by the mutual written consent of Seller and Buyer;<\/p>\n
(b) by Seller or Buyer if any court of competent
\njurisdiction or governmental body, authority or agency having jurisdiction shall
\nhave issued an order, decree or ruling or taken any other action restraining,
\nenjoining or otherwise prohibiting the transactions contemplated by this
\nAgreement and such order, decree, ruling or other action shall have become final
\nand nonappealable; and<\/p>\n
(c) by either party if the Closing shall not have occurred
\non or before December 31, 2001; provided that the terminating party is not
\notherwise in material default or breach of this Agreement.<\/p>\n
9.2 Effect of Termination. If any party terminates this Agreement
\npursuant to Section 9.1 above, all obligations of the parties hereunder shall
\nterminate without any liability of any party to such other party; provided that
\nnothing herein shall relieve any party from any liability for any breach of this
\nAgreement.<\/p>\n
ARTICLE X<\/p>\n
GENERAL PROVISIONS<\/p>\n
10.1 Expenses. Except as expressly provided herein, all of the
\nexpenses incurred by Seller in connection with the preparation, execution and
\nconsummation of this Agreement and with the transactions contemplated herein
\nshall be paid by Seller; and all such expenses of Buyer shall be paid by Buyer.<\/p>\n
35<\/p>\n
10.2 Risk of Loss. Any risk of loss or damage to the Acquired Assets
\nshall be borne by Seller until the Closing.<\/p>\n
10.3 Notices. All notices, requests, demands and other communications
\nhereunder shall be in writing, addressed as follows:<\/p>\n
If to Seller: Motorola, Inc.
\n 1301 E. Algonquin Road
\n Schaumburg, Illinois 60196
\n Facsimile No.: (847) 538-2491
\n Attn: Bob McCall<\/p>\n
and Motorola, Inc.
\n Law Department
\n 1303 E. Algonquin Road
\n Schaumburg, Illinois 60196
\n Facsimile No.: (847) 576-3628
\n Attn: General Counsel<\/p>\n
with a copy (which shall not constitute notice) to:<\/p>\n
Wiley, Rein & Fielding
\n 1776 K Street, N.W.
\n Washington, D.C. 20006
\n Facsimile No.: (202) 719-7049
\n Attn: Kay Tatum<\/p>\n
If to Buyer: General Dynamics Corporation
\n 3190 Fairview Park Drive
\n Falls Church, VA 22042
\n Facsimile No.: (703) 876-3554
\n Attn: David A. Savner<\/p>\n
with a copy (which shall not constitute notice) to:<\/p>\n
Jenner & Block, LLC
\n One IBM Plaza
\n Chicago, Illinois 60606
\n Facsimile No.: (312) 840-8711
\n Attn: Thomas A. Monson<\/p>\n
or to such other address as Buyer or Seller may designate by written notice to
\nthe other party hereto. Any such notices, requests, demands or other
\ncommunications shall be deemed to have been duly given when received if
\ndelivered personally or, if mailed, on the date five (5) days after the date so
\ndeposited in the mails, postage prepaid, return receipt requested or on the day
\nfollowing the day sent if sent by prepaid overnight delivery service. Notices,
\nrequests, demands and other communications hereunder may be delivered by
\nfacsimile transmission if confirmation <\/p>\n
36<\/p>\n
by sender is made within three (3) business days thereafter. All periods of
\nnotice will be measured from the date of deemed delivery thereof.<\/p>\n
10.4 Nondisclosure. Neither Buyer nor Seller shall issue any press
\nrelease or make any other public disclosure (including disclosure to public
\nofficials) with respect to this Agreement, the Ancillary Agreements or the
\ntransactions contemplated by this Agreement or the Ancillary Agreements, except
\nas required by law, without the prior approval of the other party, which
\napproval shall not be unreasonably withheld; provided, that either party may, if
\nconsidered necessary by its counsel to fulfill its obligations as a publicly
\ntraded corporation, respond to inquiries and issue such releases as it considers
\nnecessary and appropriate, if it notifies the other party in advance of the
\nsubstance of such proposed response or proposed release and gives such party
\nreasonable opportunity for comment prior to such response or release.<\/p>\n
10.5 Dispute Resolution<\/p>\n
(a) Seller and Buyer mutually desire that friendly
\ncollaboration be maintained between themselves. Accordingly, they shall try to
\nresolve in a friendly manner all disagreements and misunderstandings connected
\nwith their respective rights and obligations under this Agreement, including any
\namendments hereof.<\/p>\n
(b) To the extent that any misunderstanding or dispute
\ncannot be resolved agreeably in a friendly manner, the dispute may be mediated
\nby such mutually-acceptable mediator as may be chosen by Seller and Buyer within
\nforty-five (45) days after written notice by the party seeking mediation. The
\nparties may also agree to attempt some other form of ADR in lieu of mediation,
\nincluding by way of example and without limitation neutral fact-finding or a
\nmini-trial.<\/p>\n
(c) Nothing in this Section 10.5 will prevent either party
\nfrom resorting to judicial proceedings.<\/p>\n
(d) Each of Buyer and Seller shall bear its costs of
\nmediation or ADR, but Buyer and Seller agree to share equally the costs of the
\narbitrator, mediator or other person or forum to whom or to which the parties
\njointly appeal for assistance in resolving a dispute.<\/p>\n
10.6 Limitation of Liability. NOTWITHSTANDING ANY OTHER PROVISION OF
\nTHIS AGREEMENT, IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR SPECIAL,
\nINCIDENTAL, INDIRECT, COLLATERAL, CONSEQUENTIAL OR PUNITIVE DAMAGES OR LOST
\nPROFITS IN CONNECTION WITH ANY CLAIMS, LOSSES, DAMAGES, OR INJURIES ARISING OUT
\nOF THE CONDUCT OF SUCH PARTY PURSUANT TO THIS AGREEMENT.<\/p>\n
10.7 Bulk Sales Laws. Buyer hereby waives any right or claim against
\nSeller (whether by direct suit or action or pursuant to the indemnification
\nprovisions set forth in Article VII hereof) for any claims made by creditors or
\nother third parties, or any Damages suffered by Buyer, with respect to
\ncompliance with any Law relating to bulk sales or transfers.<\/p>\n
37<\/p>\n
10.8 Provisions in Ancillary Agreements to Govern Notwithstanding any
\nprovision to the contrary contained in this Agreement or in any of the Ancillary
\nAgreements, the parties acknowledge that employee matters, intellectual
\nproperty, environmental matters and transition services are governed by the
\nrespective Ancillary Agreements, and if and to the extent that there is any
\nconflict between this Agreement and an Ancillary Agreement with respect to the
\nsubject matter covered by the Ancillary Agreement, the terms and conditions of
\nthe Ancillary Agreement shall govern.<\/p>\n
10.9 Miscellaneous<\/p>\n
(a) Governing Law; Jurisdiction. This Agreement shall be
\ngoverned and construed under the internal laws (but not the principles of
\nconflicts of laws) of the State of Illinois. Each of Seller and Buyer consents
\nto the exclusive jurisdiction of the federal courts of Illinois for any
\nProceeding in connection with this Agreement or the transactions contemplated
\nhereby and agrees that any such Proceeding may be brought only in such courts.
\nEach of Seller and Buyer further waives any objection to the laying of venue for
\nany Proceeding in such courts. Each party agrees to accept and acknowledge
\nservice of any and all process that may be served in any Proceeding. Each party
\nagrees that any service of process upon it mailed by registered or certified
\nmail, return receipt requested to such party at the address provided in Section
\n10.3 above will be deemed in every respect effective service of process upon
\nsuch party in any such Proceeding. Each party agrees to waive any right it might
\nhave to a trial by jury in any such Proceeding.<\/p>\n
(b) Entire Agreement. This Agreement, together with all
\nexhibits and schedules hereto, and other documents contemplated hereby to be
\ndelivered by the parties including, but not limited to, the Ancillary
\nAgreements, cover the entire understanding of the parties hereto, superseding
\nall prior agreements or understandings relating to any of the subject matters
\nhereof, and no modification or amendment of the terms and conditions shall be
\neffective unless in writing and signed by the parties or their respective duly
\nauthorized agents.<\/p>\n
(c) Further Assurances. Each party hereto shall, both prior
\nand subsequent to the Closing Date, upon the request of the other party and
\nwithout further consideration, execute and deliver such other instruments of
\nconveyance, assignment, transfer and assumption, and take such other actions,
\nincluding making relevant employees available for consultation and assistance,
\nas such other party may reasonably request to more effectively and efficiently
\ncarry out the covenants and agreements of the parties set forth herein and
\nconsummate the transactions contemplated by this Agreement.<\/p>\n
(d) Successors and Assigns. This Agreement inures to the
\nbenefit of, and is binding upon, the successors, permitted assigns, and personal
\nrepresentatives of the parties hereto. Neither party may assign its rights or
\nobligations under this Agreement without the express written consent of the
\nother party, except that Buyer may, without the prior written consent of Seller,
\nassign its rights under this Agreement to any of its direct or indirect wholly
\nowned subsidiaries, provided that Buyer shall remain liable for all of its
\nobligations under this Agreement.<\/p>\n
38<\/p>\n
(e) Headings. This Agreement shall not be interpreted by
\nreference to any of the titles or headings to the sections or paragraphs of this
\nAgreement, which have been inserted for convenience purposes only and are not
\ndeemed a part hereof.<\/p>\n
(f) Schedules; Exhibits. This Agreement is deemed to include
\nall of the schedules and exhibits hereto, which are made a part hereof by this
\nreference thereto.<\/p>\n
(g) Counterparts. This Agreement may be executed in
\ncounterparts, both of which together shall be deemed to constitute one and the
\nsame instrument.<\/p>\n
(h) Severability. This Agreement shall be fully enforceable
\nand effective as to the parties hereto as to its remaining provisions in the
\nevent any provision is held to be invalid, illegal or unenforceable.<\/p>\n
(i) No Third Party Beneficiaries. This Agreement shall not
\nconfer any rights or remedies on any person other than the parties hereto and
\ntheir respective successors and permitted assigns.<\/p>\n
(j) No Waiver. Any failure or delay on the part of either
\nparty in the exercise of any right or privilege hereunder shall not operate as a
\nwaiver thereof, nor shall any single or partial exercise of any such right or
\nprivilege preclude other or further exercise thereof or any other right or
\nprivilege.<\/p>\n
[SIGNATURE PAGE FOLLOWS]<\/p>\n
39<\/p>\n
SIGNATURE PAGE TO ASSET PURCHASE AGREEMENT<\/p>\n
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
\nAgreement with legal and binding effect as of the date and year first above
\nwritten.<\/p>\n
SELLER: MOTOROLA, INC.<\/p>\n
By: \/s\/Keith Bane
\n ——————————-
\n Name: Keith Bane
\n Title: Executive Vice President<\/p>\n
BUYER: GENERAL DYNAMICS CORPORATION<\/p>\n
By: \/s\/Ken Dahlberg
\n ——————————-
\n Name: K. C. Dahlberg
\n Title: Executive Vice President<\/p>\n
Exhibits (omitted except as indicated below)<\/p>\n
A – Definitions (attached)<\/p>\n
A-1 – Knowledge<\/p>\n
B – Intellectual Property Agreement (attached)<\/p>\n
C – Employee Matters Agreement (attached)<\/p>\n
D – Environmental Matters Agreement (attached)<\/p>\n
E-1 – Transition Services Agreement – Motorola Services<\/p>\n
E-2 – Transition Services Agreement – IISG Services<\/p>\n
F – Bill of Sale<\/p>\n
G – Assignment and Assumption Agreement<\/p>\n
H – Financial Statements<\/p>\n
I – Lease<\/p>\n
J – Strategic Alliance Agreement<\/p>\n
K – IISG\/Motorola Labs Technology Cooperation Agreement<\/p>\n
L – IISG\/SPS Technology Cooperation Agreement<\/p>\n
M – IISG\/PCS Technology Cooperation Agreement<\/p>\n
N – IISG\/PCS Joint Development Agreement<\/p>\n
O – Manufacturer Representative and Supply Agreement<\/p>\n
P – International Manufacturer Representative Agreement<\/p>\n
Q – Intellectual Property Agreement for Test Equipment<\/p>\n
R – Iridium Subscriber Handset Agreement<\/p>\n
S – Joint Pursuit Teaming Agreement (U.S. Coast Guard)<\/p>\n
Schedules (omitted)<\/p>\n
1.1(b) – Software Licenses<\/p>\n
1.1(c) – Tangible Personal Property<\/p>\n
1.1(e) – Real Property<\/p>\n
1.1(m) – Telephone Numbers<\/p>\n
1.2(m) – Excluded Assets<\/p>\n
1.2(n) – Excluded Contracts<\/p>\n
1.4(a) – Excluded Claims<\/p>\n
1.4(h) – Excluded Liabilities<\/p>\n
3.3 – Conflicts<\/p>\n
3.4 – Taxes<\/p>\n
3.5 – Litigation<\/p>\n
3.6(b) – Ownership of Assets<\/p>\n
3.7 – Real Property<\/p>\n
3.8 – Compliance with Laws<\/p>\n
3.9 – Material Contracts<\/p>\n
3.10(a)- Government Contract Compliance<\/p>\n
3.10(b)- Government Contract Investigations<\/p>\n
3.10(c)- Government Contract Absence of Claims<\/p>\n
3.10(d)- Cost Accounting Systems<\/p>\n
3.12 – Clearances<\/p>\n
3.14 – Disclosed Liabilities<\/p>\n
3.15 – Absence of Change<\/p>\n
3.16 – Brokers<\/p>\n
6.1(d) – Required Consents<\/p>\n
8.1(b) – Capital Acquisition Report<\/p>\n
8.5(e) – Third Party Consent Provisions<\/p>\n
8.11(d)- Leased Premises for Estoppel Agreements<\/p>\n
8.12 – Indirect Expense Rates<\/p>\n
EXHIBIT A<\/p>\n
DEFINITIONS<\/p>\n
“Accounts Payable” shall have the meaning referenced in Section 1.3(b).<\/p>\n
“Accounts Receivable” shall have the meaning referenced in Section
\n1.1(f).<\/p>\n
“Acquired Assets” shall have the meaning referenced in Section 1.1.<\/p>\n
“ADR” shall mean alternative dispute resolution.<\/p>\n
“Affiliate” shall mean, with respect to any specified entity or
\norganization, an entity or organization that directly, or indirectly through one
\nor more intermediaries, controls, is controlled by, or is under common control
\nwith, such specified entity or organization.<\/p>\n
“Allocation Base” shall have the meaning referenced in Section 8.12.<\/p>\n
“Allocation Statement” shall have the meaning referenced in Section
\n2.2(a).<\/p>\n
“Ancillary Agreements” shall mean, collectively, the Employee Matters
\nAgreement, the Intellectual Property Agreement, the Environmental Matters
\nAgreement, the Transition Services Agreements, the Strategic Alliance Agreement
\nand the Commercial Agreements.<\/p>\n
“Assignment and Assumption Agreement” shall mean the Assignment and
\nAssumption Agreement substantially in the form attached hereto as Exhibit G.<\/p>\n
“Assumed Real Property Leases” shall have the meaning referenced in
\nSection 1.1(e).<\/p>\n
“Assumed Liabilities” shall have the meaning referenced in Section 1.3.<\/p>\n
“Balance Sheet” shall mean the balance sheet for the Group as of the
\nBalance Sheet Date.<\/p>\n
“Balance Sheet Date” shall mean June 30, 2001.<\/p>\n
“Bill of Sale” shall mean the Bill of Sale substantially in the form
\nattached hereto as Exhibit F.<\/p>\n
“Books and Records” shall have the meaning referenced in Section 1.1(h).<\/p>\n
“Business Day” shall mean any day other than a Saturday, Sunday or legal
\nholiday that banks are open in Chicago, Illinois.<\/p>\n
“Buyer Parties” shall have the meaning referenced in Section 7.1.<\/p>\n
“Capital Acquisition Report” shall mean the financial report of Seller
\ncontaining the actual and budgeted capital expenditures of Seller with respect
\nto the Group in the form attached hereto as Schedule 8.1(b).<\/p>\n
“Certicom Investment” shall mean the shares of common stock and other
\nequity rights held by Seller and its Affiliates in Certicom Corporation.<\/p>\n
“Claim” shall mean a demand, suit, claim or assertion of liability by
\nthird parties or other circumstances that could give rise to an indemnification
\nobligation arising under Article VII of this Agreement.<\/p>\n
“Clearances” shall have the meaning referenced in Section 3.12.<\/p>\n
“Closing” shall have the meaning referenced in Section 5.1.<\/p>\n
“Closing Date” shall have the meaning referenced in Section 5.1.<\/p>\n
“Code” shall mean the Internal Revenue Code of 1986, as amended.<\/p>\n
“Commercial Agreements” shall mean collectively the IISG\/Motorola Labs
\nTechnology Cooperation Agreement, the IISG\/SPS Technology Cooperation Agreement,
\nthe IISG\/PCS Technology Cooperation Agreement, the IISG\/PCS Joint Development
\nAgreement, the Manufacturer Representative and Supply Agreement, the
\nInternational Manufacturer Representative Agreement, the Intellectual Property
\nAgreement for Test Equipment, the Iridium Subscriber Handset Agreement and the
\nJoint Pursuit Teaming Agreement (U.S. Coast Guard).<\/p>\n
“Contracts” shall have the meaning referenced in Section 1.1(a).<\/p>\n
“Damages” shall mean losses, costs, claims, actions, suits, proceedings,
\ndemands, damages, liabilities, obligations, amounts paid in settlement, interest
\nand expenses (including reasonable attorneys’ fees, court costs and other
\nout-of-pocket expenses incurred in investigating, preparing or defending the
\nforegoing).<\/p>\n
“Disputed Claims” shall mean claims for Damages by an indemnified party
\nwhich the indemnifying party objects to in writing within thirty (30) days after
\nreceiving notice of the Claim.<\/p>\n
“Employee Matters Agreement” shall mean the Employee Matters Agreement
\nsubstantially in the form attached hereto as Exhibit C, including the Motorola
\nGeneral Dynamics Pension Transfer Agreement and the Motorola General Dynamics
\n401(h) Transfer Agreement.<\/p>\n
“Environmental Matters Agreement” shall mean the Environmental Matters
\nAgreement substantially in the form attached hereto as Exhibit D.<\/p>\n
“Excluded Assets” shall mean all assets, properties, rights, contracts
\nand claims of Seller or its Affiliates except for the Acquired Assets, including
\nwithout limitation, the assets, properties, rights, contracts and claims listed
\nin Sections 1.2(a) through (n).<\/p>\n
“Excluded Liabilities” shall have the meaning referenced in Section 1.4.<\/p>\n
“Financial Statements” shall have the meaning referenced in Section
\n3.13.<\/p>\n
“GAAP” shall mean United States generally accepted accounting
\nprinciples.<\/p>\n
“Governmental Authority” shall mean any legislative, executive or
\njudicial unit of any governmental entity (foreign, federal, state or local) or
\nany department, commission, board, agency, bureau, official or other regulatory,
\nadministrative or judicial authority thereof, foreign or domestic.<\/p>\n
“Government Contracts” shall mean those Contracts with (i) the United
\nStates Government (acting on its own behalf or on behalf of another country or
\ninternational organization), (ii) any prime contractor performing under a prime
\ncontract with the United States Government, (iii) any subcontractor performing
\nunder a prime contract with the United States Government, or (iv) any foreign
\ngovernment.<\/p>\n
“Government Proposal” shall mean all bids or proposals in respect of the
\nGroup which, if accepted, would result in a Government Contract.<\/p>\n
“Group Confidential Information” shall have the meaning referenced in
\nSection 8.6(b).<\/p>\n
“Group Indirect Expenses” shall have the meaning referenced in Section
\n8.12.<\/p>\n
“HSR Act” shall mean Hart-Scott-Rodino Antitrust Improvements Act of
\n1976, as amended.<\/p>\n
“IISG\/Motorola Labs Technology Cooperation Agreement” shall mean the
\nIISG\/Motorola Labs Technology Cooperation Agreement substantially in the form
\nattached hereto as Exhibit K.<\/p>\n
“IISG\/PCS Joint Development Agreement” shall mean the IISG\/PCS Joint
\nDevelopment Agreement substantially in the form attached hereto as Exhibit N.<\/p>\n
“IISG\/PCS Technology Cooperation Agreement” shall mean the IISG\/PCS
\nTechnology Cooperation Agreement substantially in the form attached hereto as
\nExhibit M.<\/p>\n
“IISG\/SPS Technology Cooperation Agreement” shall mean the IISG\/SPS
\nTechnology Cooperation Agreement substantially in the form attached hereto as
\nExhibit L.<\/p>\n
“Intellectual Property Agreement” shall mean the Intellectual Property
\nAgreement substantially in the form attached hereto as Exhibit B.<\/p>\n
“Intellectual Property Agreement for Test Equipment” shall mean the
\nIntellectual Property Agreement for Test Equipment substantially in the form
\nattached hereto as Exhibit Q.<\/p>\n
“International Manufacturer Representative Agreement” shall mean the
\nInternational Manufacturer Representative Agreement substantially in the form
\nattached hereto as Exhibit P.<\/p>\n
“Inventory” shall have the meaning referenced in Section 1.1(d).<\/p>\n
“Iridium Claims” shall mean any liability or obligation in respect of
\nProceedings relating to the Iridium satellite communications business, including
\nwith limitation Freeland v. Iridium World Communications, Inc., et al., The
\nChase Manhattan Bank v. Motorola, Inc., The Chase Manhattan Bank v. Iridium
\nAfrica Corp. and Statutory Committee of Unsecured Creditors v. Motorola, Inc.<\/p>\n
“Iridium Subscriber Handset Agreement” shall mean the Iridium Subscriber
\nHandset Agreement substantially in the form attached hereto as Exhibit R.<\/p>\n
“Joint Pursuit Teaming Agreement (U.S. Coast Guard)” shall mean the
\nJoint Pursuit Teaming Agreement (U.S. Coast Guard) substantially in the form
\nattached hereto as Exhibit S.<\/p>\n
“Knowledge” shall mean actual knowledge of a particular fact or other
\nmatter after due inquiry. For purposes of this Agreement, Seller’s Knowledge and
\nBuyer’s Knowledge shall, respectively, be limited to the actual knowledge of
\nthose persons listed under such party’s name on Exhibit A-1.<\/p>\n
“Laws” shall mean laws, statutes, ordinances, regulations, rules,
\ndecrees, orders, judgments, permits and licenses of or from Governmental
\nAuthorities.<\/p>\n
“Lease” shall mean the Lease substantially in the form attached hereto
\nas Exhibit I.<\/p>\n
“Leased Premises” shall mean the real property that is leased or
\nsubleased by Seller as lessee from Third Parties or Affiliates of Seller, is
\nused or held for use in connection with the business or operations of the Group,
\nand is identified on Schedule 3.7.<\/p>\n
“Liens” shall mean liens, claims, charges, security interests,
\nrestrictions and other encumbrances of any kind or nature.<\/p>\n
“Manufacturer Representative and Supply Agreement” shall mean the
\nManufacturer Representative and Supply Agreement substantially in the form
\nattached hereto as Exhibit O.<\/p>\n
“Material Adverse Effect” shall mean any effect that is reasonably
\nexpected to be materially adverse to the business, condition (financial or
\notherwise), operations or results of operations of the Group when taken as a
\nwhole or to the value of the Acquired Assets when taken as a whole.<\/p>\n
“Material Contract” shall have the meaning referenced in Section 3.9.<\/p>\n
“Material Proceeding” shall have the meaning referenced in Section 3.5.<\/p>\n
“Motorola Credit Union Ground Lease” shall mean the Lease dated May 7,
\n1982 between Seller and the Motorola Credit Union of Arizona.<\/p>\n
“Novation Agreement” shall have the meaning referenced in Section 8.4.<\/p>\n
“Open Years” shall have the meaning referenced in Section 8.12.<\/p>\n
“Owned Premises” shall have the meaning referenced in Section 1.1(e).<\/p>\n
“Permits” shall mean all permits, consents, approvals, franchises,
\ncertificates of inspection or authority, authorizations and orders, and any
\nwaiver of the foregoing, issued by any Governmental Authority and used or held
\nfor use in relation to the business or operation of the Group or the Acquired
\nAssets, but not including Clearances.<\/p>\n
“Permitted Liens” shall mean (i) Liens which will be discharged upon
\npayment by Buyer of the associated Assumed Liabilities, (ii) easements, rights
\nof way, restrictions, encumbrances, covenants, conditions, encroachments or any
\nother matters affecting title to any parcel of the Owned Premises or any of the
\nother Acquired Assets which do not individually or in the aggregate materially
\ndetract from the value or interfere materially with the present use of the
\naffected parcel or the Owned Premises or the Acquired Assets, and (iii) Liens
\nfor Taxes, materialmen’s, mechanics’, carriers’, workmen’s, repairmen’s and
\nother like Liens arising in the ordinary course of business of the Group and not
\nyet due and payable and for which reserves have been established in accordance
\nwith GAAP.<\/p>\n
“Person” shall mean any individual, corporation, partnership, firm,
\nassociation, joint venture, joint stock company, trust, unincorporated
\norganization or other entity, or any government or regulatory, administrative or
\npolitical subdivision or agency, department or instrumentality thereof.<\/p>\n
“Personal Property Leases” shall have the meaning referenced in Section
\n1.1(b).<\/p>\n
“Premises” shall mean the Owned Premises and the Leased Premises.<\/p>\n
“Primary Ancillary Agreements” shall mean the Ancillary Agreements other
\nthan the Strategic Alliance Agreement and the Commercial Agreements.<\/p>\n
“Proceeding” shall mean a matter of governmental, judicial or
\nadversarial proceedings (public or private), litigation, arbitration, disputes,
\nclaims, causes of action or investigations.<\/p>\n
“Pro Forma Balance Sheet” shall mean the balance sheet for the Group as
\nof the Balance Sheet Date which reflects the Acquired Assets and the Assumed
\nLiabilities.<\/p>\n
“Purchase Price” shall have the meaning referenced in Section 2.1.<\/p>\n
“Seller Parties” shall have the meaning referenced in Section 7.2.<\/p>\n
“Seller’s Corporate Allocation” shall have the meaning referenced in
\nSection 8.12.<\/p>\n
“Software Licenses” shall have the meaning referenced in Section 1.1(b).<\/p>\n
“Strategic Alliance Agreement” shall mean the Strategic Alliance
\nAgreement substantially in the form attached hereto as Exhibit J.<\/p>\n
“Survey” shall have the meaning referenced in Section 8.11(c).<\/p>\n
“Tangible Personal Property” shall have the meaning referenced in
\nSection 1.1(c).<\/p>\n
“Taxes” shall have the meaning referenced in Section 3.4.<\/p>\n
“Third Party” shall mean any Person not an Affiliate of the other
\nreferenced Person or Persons.<\/p>\n
“Title Commitment” shall have the meaning referenced in Section 8.11(b).<\/p>\n
“Title Company” shall have the meaning referenced in Section 8.11(b).<\/p>\n
“Title Policies” shall have the meaning referenced in Section 6.1(e).<\/p>\n
“Transition Services Agreements” shall mean the Transition Services
\nAgreements substantially in the form attached hereto as Exhibit E-1 and Exhibit
\nE-2.<\/p>\n
“United States Government” shall mean the federal government of the
\nUnited States of America and any agencies, instrumentalities and departments
\nthereof.<\/p>\n
“Unpermitted Lien” shall have the meaning referenced in Section 8.11(b).<\/p>\n
EXHIBIT B<\/p>\n
INTELLECTUAL PROPERTY AGREEMENT<\/p>\n
between<\/p>\n
MOTOROLA, INC.,
\n a Delaware corporation<\/p>\n
and<\/p>\n
GENERAL DYNAMICS CORPORATION,
\n a Delaware Corporation<\/p>\n
Dated as of August 6, 2001<\/p>\n
INTELLECTUAL PROPERTY AGREEMENT<\/p>\n
This Intellectual Property Agreement (this “IP Agreement”), made as of
\nAugust 6, 2001, between Motorola, Inc. (“Seller”), a Delaware corporation, and
\nGeneral Dynamics Corporation (“Buyer”), a Delaware corporation.<\/p>\n
WITNESSETH:<\/p>\n
WHEREAS, Seller designs, develops, manufactures, produces, provides,
\nintegrates and sells secure communication and information products, systems and
\nservices, including integrated command, control, communication, computer,
\nintelligence, surveillance and reconnaissance systems; software-defined radio
\nsystems; high-assurance security and encryption products and services;
\nintegrated communications systems; and specialized restricted space payloads,
\nfor government and military enterprises in domestic and international markets
\nthrough its Integrated Information Systems Group (the “Group”); and<\/p>\n
WHEREAS, Buyer desires to acquire substantially all of the assets,
\nbusiness and operation of the Group and is willing to assume certain specified
\nliabilities of the Group, and Seller is willing to convey and assign the same
\nall on the terms and conditions set forth in the Asset Purchase Agreement
\n(“Asset Purchase Agreement”); and<\/p>\n
WHEREAS, certain Seller assets used by the Group constitute intellectual
\nproperty assets (“IP Assets”), including (but not limited to): U.S. and foreign
\npatents and pending patent applications, invention disclosures and innovations
\n(whether or not patentable and whether or not reduced to practice); U.S. and
\nforeign registered and unregistered trademarks, service marks, brand names,
\ntrade dress, internet domain names, trade names and other indications of origin,
\nthe goodwill associated with the foregoing, and applications to register the
\nforegoing, including any extension, modification, or renewal of any such
\nregistration or application; U.S. and foreign registered and unregistered
\ncopyrights; software; non-public and confidential information, know-how and
\ntrade secrets; mask works; other intellectual property protectable by rights
\nunder state law or common law; and any claims or causes of action arising out of
\nor related to any infringement or misappropriation of any of the foregoing
\noccurring before, on, or after the Closing Date; and<\/p>\n
WHEREAS, as part of Buyer’s acquisition of the Group, Seller intends to
\ntransfer certain IP Assets to the Buyer and license Buyer to use and have
\ncertain intellectual property rights in certain other IP Assets; and<\/p>\n
WHEREAS, Buyer intends to license Seller to use and have certain
\nintellectual property rights in certain of such transferred IP Assets, as
\nfurther herein defined.<\/p>\n
NOW THEREFORE, in consideration of the premises and the mutual
\nrepresentations, warranties, covenants and agreements set forth below and in the
\nAsset Purchase Agreement, the parties agree with legal and binding effect as
\nfollows:<\/p>\n
ARTICLE I<\/p>\n
DEFINITIONS<\/p>\n
As used in this IP Agreement, capitalized terms not otherwise defined
\nherein shall have the meanings as set forth on Exhibit A to the Asset Purchase
\nAgreement.<\/p>\n
1.1 “Assigned Copyrightable Materials” means Seller and Seller
\nSubsidiary owned technical manuals, application notes, promotional materials and
\nother printed, written or computer-stored materials used exclusively by the
\nGroup in connection with the business or operation of the Group as of the
\nClosing Date.<\/p>\n
1.2 “Assigned Copyrights” means the copyright registrations and
\nregistration applications set forth on Schedule 1.2 hereto.<\/p>\n
1.3 “Assigned Invention Disclosures” means the invention disclosures
\nset forth on Schedule 1.3 hereto.<\/p>\n
1.4 “Assigned Know-How” means confidential and proprietary
\ninformation owned by Seller and its Subsidiaries, including without limitation
\ntechnical product specifications, technical product plans, reports, data,
\ndrawings, documents, algorithms, methods of manufacture, methods of use,
\nbusiness methods, process flow sheets and other information that is used
\nexclusively by the Group in connection with the business or operation of the
\nGroup as of the Closing Date. In no event shall the term Assigned Know-How
\ninclude or encompass any Celestri Know-How, Iridium Know-How, Teledesic Know-How
\nor any other Seller Know-How. “Celestri Know-How” means all confidential and
\nproprietary information owned or licensable by Seller that relates to: (i)
\nsystem concepts or designs developed by Seller for any combined GEO\/LEO
\nsatellite broadband data transmission system, concepts, together with any
\nsystems, concepts, studies, or research from any predecessor programs to such
\ncombined GEO\/LEO satellite broadband data transmission system; and (ii) the
\nnumber and arrangement of satellites, capacity enhancement strategies, network
\ntransport protocols, network topologies, network routing and operation concepts,
\nnetwork control, system control, and methods of hand-off. Celestri Know-How
\nshall not include specific hardware or software implementations of any
\ncomponents such as, but not limited to, satellites, satellite payload, and
\nsubcomponents thereof. “Iridium Know-How” means all confidential and proprietary
\ninformation owned or licensable by Seller that relates to: (i) system concepts
\nor designs developed by Seller for any primarily voice, narrowband
\nsatellite-based telecommunications system, concepts, or studies; and (ii) the
\nnumber and arrangement of satellites, capacity enhancement strategies, network
\ntransport <\/p>\n
protocols, network topologies, network routing and operation concepts, network
\ncontrol, system control and methods of hand-off. Iridium Know-How does not
\ninclude specific hardware or software implementations of any components such as,
\nbut not limited to, satellites, satellite payload, and subcomponents thereof, or
\nthose system concepts or designs developed by Seller that are incorporated into
\nthe Celestri Know-How or Teledesic Know-How. “Teledesic Know-How” means all
\nconfidential and proprietary information owned or licensable by Seller that
\nrelates to: (i) system concepts or designs developed by Seller for a
\nsatellite-based broadband system for the transmission of communications and
\ndata, such system including satellites; ground-based sites, equipment, and
\nfacilities to operate and manage the satellites and the communications links of
\nthe system; one or more network control systems; and ground-based equipment and
\nsoftware which is used by subscribers for sending and receiving communications
\nthrough the system; and (ii) the number and arrangement of satellites, capacity
\nenhancement strategies, network transport protocols, network topologies, network
\nrouting and operation concepts, network control, system control, and methods of
\nhand-off. Teledesic Know-How does not include specific hardware or software
\nimplementations of any components such as, but not limited to, satellites,
\nsatellite payload, and subcomponents thereof.<\/p>\n
1.5 “Assigned Patents” means the U.S. and foreign patents and patent
\napplications set forth on Schedule 1.5 hereto.<\/p>\n
1.6 “Assigned Software” means software owned by Seller and its
\nSubsidiaries and used exclusively by the Group in connection with the business
\nor operation of the Group as of the Closing Date. Assigned Software does not
\ninclude third party software used under license by Seller (“Third Party
\nSoftware”).<\/p>\n
1.7 “Assigned Trademarks” means the trademarks, service marks, brand
\nnames, trade dress, trade names, and other indications of origin, the goodwill
\nassociated with the foregoing, and U.S. and foreign registrations and
\napplications for the foregoing (the “Marks”) used exclusively by the Group in
\nconnection with the business or operation of the Group as of the Closing Date,
\nincluding but not limited to the Marks set forth on Schedule 1.7 hereto.<\/p>\n
1.8 “Confidential Information” means the information of each party
\nreferenced in Section 5.5 below.<\/p>\n
1.9 “Excluded IP Assets” means any and all Seller Intellectual
\nProperty, including Licensed Patents, not specifically identified herein as
\nTransferred IP Assets. Excluded IP Assets expressly includes Seller’s technology
\ndescribed in Section 2.2.8.<\/p>\n
1.10 “Fuze Patents” means those patents set forth on Schedule 1.10
\nhereto.<\/p>\n
1.11 “Group Customers” means (i) the United States Government or any
\nforeign government, and any legislative, executive or judicial unit, any
\nmilitary enterprise, or any department, administration, agency, bureau, board,
\ncommission, court, department, official, political subdivision, tribunal, or
\nother regulatory, administrative or judicial authority of the United States
\nGovernment or any foreign government or any international governmental<\/p>\n
organization (such as NATO or the United Nations) (collectively, “Governmental
\nEntities”); (ii) any United States state or local governmental entity in
\nconnection with the business or operation of an aviation facility, including
\ncommercial airports; (iii) any business entity to the limited extent such
\nbusiness entity is acting under a prime contract, or subcontract to a prime
\ncontract, with a Governmental Entity, and then only in connection with said
\nprime contract or subcontract, or is conducting independent research and
\ndevelopment (“IRAD”) of products, systems or services for the general purpose of
\nselling such products, systems or services to Governmental Entities; (iv) any
\nbusiness entity in connection with space-borne equipment, high-assurance
\ninformation security products and services, network security services or
\ncommand, control, communication, computer, intelligence, surveillance and
\nreconnaissance systems; and (v) any other customer to whom the Group has sold
\nproducts or services or submitted a bid or proposal (which has not expired, been
\nwithdrawn or awarded to a third party) within the two (2) years preceding the
\ndate of this IP Agreement. Group Customers do not include United States state
\nand local governmental entities except as identified in (ii) above.<\/p>\n
1.12 “Group Products” means products, systems and services designed,
\ndeveloped, manufactured, produced, provided, integrated or sold by the Group or
\nthe subject of any outstanding bid or proposal of the Group as of the Closing
\nDate.<\/p>\n
1.13 “Licensed Copyrightable Materials” means Seller and Seller
\nSubsidiary owned technical manuals, application notes, promotional materials and
\nother printed, written or computer-stored materials used, but not exclusively,
\nby the Group in connection with the business or operation of the Group as of the
\nClosing Date, as well as the training materials identified in Schedule 1.13.<\/p>\n
1.14 “Licensed Know-How” means any Seller Know-How (excluding
\nAssigned Know-How) that is specifically used by the Group in connection with the
\nbusiness or operation of the Group as of the Closing Date. In no event shall
\nLicensed Know-How include any know-how developed or acquired by Seller after the
\nClosing Date.<\/p>\n
1.15 “Licensed IP Assets” means the Licensed Copyrightable Materials,
\nthe Licensed Know-How, the Licensed Software, and the Licensed Patents.<\/p>\n
1.16 “Licensed Patents” means those patents and patent applications
\nset forth on Schedule 1.16 hereto and all classes or types of U.S. and foreign
\npatents or patent applications owned by Seller and its Subsidiaries, that are
\nfiled or granted on or before the Closing Date, to the extent Seller has the
\nright to grant licenses without the payment of royalties or other consideration
\nto third persons, and have claims that read on technology developed or in
\ndevelopment by the Group as of the Closing Date or on technology that is the
\nsubject of any outstanding written bid or proposal of the Group as of the
\nClosing Date.<\/p>\n
1.17 “Licensed Products” means (i) any Group Products, as well as
\nfuture generations derived from such Group Products; (ii) defense products and
\nsystems (consisting of integrated command, control, communication, computer,
\nintelligence, surveillance, and\/or reconnaissance systems); (iii)
\nsoftware-defined radio systems other than commercial applications; (iv)
\nhigh-<\/p>\n
assurance security and encryption products and services; and (v) specialized
\nrestricted space payloads. A component, product, system or service provided to,
\nsupplied to or otherwise obtained by the Group from Seller, Seller Subsidiaries
\nor third parties and integrated in or with a Licensed Product is not considered
\nand does not constitute, by itself, a Licensed Product. For purposes hereof,
\ncommercial applications shall include without limitation commercial cellular
\ntelephony, commercial land mobile two-way radios and commercial paging and
\nmessaging.<\/p>\n
1.18 “Licensed Software” means software owned by Seller and its
\nSubsidiaries and used or intended to be used, but not exclusively, by the Group
\nin connection with the business or operation of the Group as of the Closing
\nDate. In no event shall Licensed Software include any software developed or
\nacquired by Seller after the Closing Date. Further, Licensed Software does not
\ninclude Third Party Software.<\/p>\n
1.19 “Residual Information” means that information and knowledge of
\nthe Excluded IP Assets retained in the minds of the Transferred Employees
\nwithout rote memorization, or reference to confidential information of Seller
\nand\/or a third party, either being in written, computer-stored or another
\ntangible form.<\/p>\n
1.20 “Seller Intellectual Property” (or “Seller IP”) means any and
\nall IP Assets owned by Seller prior to the Closing Date, including Seller
\nKnow-How.<\/p>\n
1.21 “Seller Know-How” means all confidential and proprietary
\ninformation owned or licensable by Seller (excluding Assigned Know-How) that
\nrelates to two-way radios and systems, satellite, short messaging service,
\nwireless telephony and systems, wireless modems, personal communication devices
\nand systems, local or wide area networks and other communications products
\ncurrently made by or on behalf of Seller or any Subsidiary of Seller and future
\nversions thereof, or any semiconductor device, material, circuit, or the process
\nor method involved in the manufacture thereof.<\/p>\n
1.22 “Subsidiary” means a corporation, company, or other entity more
\nthan fifty percent (50%) of whose outstanding shares or securities (representing
\nthe right to vote for election of directors or other managing authority) are now
\nor hereafter owned or controlled, directly or indirectly, by a party hereto, but
\nsuch corporation, company or other entity shall be deemed to be a Subsidiary
\nonly so long as such ownership of control exists.<\/p>\n
1.23 “Transferred Employees” means those Seller employees that upon
\nClosing become Buyer employees.<\/p>\n
1.24 “Transferred IP Assets” means the Assigned Patents, Assigned
\nInvention Disclosures, Assigned Trademarks, Assigned Copyrightable Materials,
\nAssigned Copyrights, Assigned Know-How and Assigned Software.<\/p>\n
ARTICLE II<\/p>\n
ASSIGNMENT AND LICENSE OF IP ASSETS<\/p>\n
2.1 Transferred IP. Upon the terms and subject to the conditions of
\nthis IP Agreement, Seller hereby agrees to sell, assign (to the extent legally
\nassignable), transfer, convey and deliver (or, where applicable, cause its
\nSubsidiaries to sell, assign (to the extent legally assignable), transfer,
\nconvey and deliver) to Buyer, and Buyer hereby agrees to purchase, acquire and
\naccept from Seller (or Seller’s Subsidiaries) the Transferred IP Assets (but not
\nthe Excluded IP Assets), free and clear of all Liens, except for Permitted
\nLiens, and Buyer agrees to grant back to Seller a license to such Transferred IP
\nAssets and Seller agrees to accept such license, as more specifically set forth
\nas follows:<\/p>\n
2.1.1 Assignment to Buyer of Transferred IP. Effective upon the
\nClosing Date:<\/p>\n
(a) Patents: Seller hereby assigns to Buyer all its right,
\n title and interest, subject to existing third party licenses, in and to
\n the Assigned Patents, and acknowledges that Seller shall, on the Closing
\n Date, execute a Patent Assignment Agreement of the general form as that
\n attached as Exhibit 2.1.1(a) to this IP Agreement.<\/p>\n
(b) Invention Disclosures: Seller hereby grants to Buyer the
\n right to file any type of patent application in any country of the world
\n for the Assigned Invention Disclosures. Seller further assigns to Buyer
\n all right, title and interest, subject to existing third party licenses,
\n in such Assigned Invention Disclosures, including without limitation any
\n patent rights therein, and agrees to execute any additional
\n documentation that Buyer may reasonably request to reflect this
\n assignment. Seller makes no representation or warranty and Buyer
\n acknowledges that Seller makes no representation or warranty regarding
\n the patentability of the subject matter of the Assigned Invention
\n Disclosures.<\/p>\n
(c) Trademarks: Seller hereby assigns to Buyer all its
\n right, title and interest, subject to existing third party licenses, in
\n the Assigned Trademarks together with the goodwill of the Group
\n associated therewith, and acknowledges that Seller shall, on the Closing
\n Date, execute a Trademark Assignment Agreement in the general form as
\n that attached as Exhibit 2.1.1(c) to this IP Agreement. Notwithstanding
\n the foregoing, Buyer acknowledges that Seller currently uses the marks,
\n Access and Access Point, in relation to radio equipment and plans to use
\n the marks, Access and Access Point, in relation to wireless LAN
\n applications. Buyer acknowledges and agrees that, as between Buyer and
\n Seller, there will be no confusion between Buyer’s use (or that of its
\n Subsidiaries) of the mark, Access Point, on switches as defined in U.S.
\n trademark application Serial No. 75\/651259 and Seller’s current and
\n proposed use (or that of its Subsidiaries) of the marks, Access and
\n Access Point.<\/p>\n
(d) Copyrights: Seller hereby assigns to Buyer all its
\n right, title and interest, subject to existing third party licenses, in
\n the Assigned Copyrights and acknowledges that Seller shall, on the
\n Closing Date, execute a Copyright Assignment Agreement in the <\/p>\n
general form as that attached as Exhibit 2.1.1(d) to this IP Agreement.<\/p>\n
(e) Copyrightable Materials: Seller hereby assigns to Buyer
\n all its right, title and interest, subject to existing third party
\n licenses, in the Assigned Copyrightable Materials.<\/p>\n
(f) Know-How: Seller hereby assigns to Buyer all its right,
\n title and interest, subject to existing third party licenses, in the
\n Assigned Know-How.<\/p>\n
(g) Software. Seller hereby assigns to Buyer all its right,
\n title and interest, subject to existing third party licenses, in the
\n Assigned Software.<\/p>\n
2.1.2 Grant Back to Seller of Transferred IP.<\/p>\n
(a) Patents. Buyer hereby grants to Seller, for the life of
\n the last to expire of the Assigned Patents, a fully paid-up,
\n royalty-free, worldwide, non-exclusive, nontransferable license (except
\n to the extent expressly set forth herein), without the right to grant
\n sublicenses (except to the extent expressly set forth herein), under the
\n Assigned Patents to use, make and have made products, systems and
\n services and to lease, sell, offer for sale, import and otherwise
\n dispose of products, systems and services so made. Subject to the above
\n limitations, such license shall include the right of Seller to extend
\n sublicenses to its Subsidiaries.<\/p>\n
(b) Invention Disclosures. Buyer hereby grants to Seller a
\n fully paid-up, royalty-free, worldwide, non-exclusive license, without
\n the right to grant sublicenses (except to the extent expressly set forth
\n herein), under any rights arising out of or relating to the Assigned
\n Invention Disclosures to use, make and have made products, systems and
\n services and to lease, sell, offer for sale, import and otherwise
\n dispose of products, systems and services so made. The license of this
\n Section 2.1.2(b) shall be perpetual and, subject to the limitations
\n above, shall include the right of Seller to extend sublicenses to its
\n Subsidiaries.<\/p>\n
2.1.3 Transferability. The licenses granted to Seller in accordance
\n with Section 2.1.2 shall be transferable and\/or divisible by Seller in
\n connection with the sale, transfer or disposal of one or more Seller
\n businesses or product lines, or substantially all of the assets thereof,
\n using such licenses; provided, however, that such transferred and\/or
\n divided license rights shall be limited to the operation of the divested
\n business or product line. Further provided, however, that to the extent
\n such business or product line includes or encompasses any product,
\n system or service of the same or similar type as a Licensed Product,
\n Seller shall not for a period of five (5) years from the Closing Date
\n transfer or divide the licenses to any of the entities identified on
\n Schedule 2.1.3, except with the prior written consent of Buyer.<\/p>\n
2.2 Licenses to Buyer. Buyer acknowledges that all Seller
\nIntellectual Property, including Licensed Patents and Licensed Know-How, that is
\nnot specifically identified as a Transferred IP Asset is an Excluded IP Asset,
\nin which Buyer shall have no right, title or interest except as expressly
\nprovided for within this IP Agreement. Effective as of the Closing Date:<\/p>\n
2.2.1 Patents.<\/p>\n
(a) Seller hereby grants to Buyer, for the life of the last
\n to expire of the Licensed Patents, a fully paid-up, royalty-free,
\n worldwide, non-exclusive, non-transferable (except and to the extent
\n expressly set forth herein) license, without the right to grant
\n sublicenses (except to the extent expressly set forth herein), under
\n such Licensed Patents to use, make and have made Licensed Products and
\n to lease, sell, offer for sale, import and otherwise dispose of Licensed
\n Products so made to Group Customers. The parties agree that solely with
\n respect to the subset of Group Customers defined in Section 1.11(iv),
\n this license applies only to the extent the collective sales to such
\n subset of Group Customers does not exceed $50,000,000 in revenue in any
\n Buyer fiscal year.<\/p>\n
(b) Sublicensing. Subject to the limitations of the license,
\n the license granted to Buyer in accordance with this Section 2.2.1 shall
\n include the right of Buyer to extend sublicenses to its Subsidiaries.
\n The extension of a sublicense pursuant to this Section is subject to the
\n sublicensee assuming the same obligations as Buyer hereunder as if such
\n entity were named in the place of Buyer.<\/p>\n
(c) Transferability. The license granted to Buyer in
\n accordance with this Section 2.2.1 shall be transferable and\/or
\n divisible by Buyer in connection with the sale, transfer or disposal of
\n one or more Buyer businesses or product lines, or substantially all of
\n the assets thereof, using such licenses; provided, however, that such
\n transferred and\/or divided license rights shall be limited to the
\n operation of the divested business or product line.<\/p>\n
(d) Seller Restriction. Except as otherwise permitted by the
\n Asset Purchase Agreement or the Ancillary Agreements, for a period of
\n five (5) years from the Closing Date, Seller shall not assign or
\n license, to the extent such assignment or license includes or
\n encompasses any product, system or service of the same or similar type
\n as any Licensed Product, those Licensed Patents set forth on Schedule
\n 2.2.1(d) to any of the entities identified on Schedule 2.1.3, except
\n with the prior written consent of Buyer which consent shall not be
\n unreasonably withheld. Notwithstanding the foregoing, the parties agree
\n that the restrictions of this Section 2.2.1(d) shall not be construed to
\n prevent Seller from assigning or licensing the Licensed Patents set
\n forth on Schedule 2.2.1(d) to third parties: (i) for the purpose of
\n resolving patent disputes or settlement of litigation; or (ii) pursuant
\n to contractual obligations existing as of the Closing Date; or (iii) as
\n required by judicial order.<\/p>\n
2.2.2 Fuze Patents. Seller hereby grants to Buyer, for the life of the
\n last to expire of the Fuze Patents, a fully paid-up, royalty-free,
\n worldwide, non-exclusive, nontransferable license under the Fuze
\n Patents, without right to grant sublicenses, to use make and have made,
\n sell, offer for sale, lease, import, and otherwise dispose of products
\n within the missile fuze business, which the parties acknowledge and
\n agree excludes the conventional fuze business.<\/p>\n
2.2.3 Subject to the limitations of the license, the license granted
\n to Buyer in accordance with Section 2.2.1 shall include the right of
\n Buyer to extend sublicenses under the Licensed Patents set forth on
\n Schedule 2.2.1(d) to third parties who have entered into a teaming,
\n partnership or joint venture type agreement with Buyer to jointly
\n develop and lease, sell or otherwise dispose of Licensed Products to
\n Group Customers (“Buyer Permitted Activity”). Provided however, such
\n right to extend sublicenses is limited to the Buyer Permitted Activity
\n and any such sublicense shall terminate immediately (i) upon termination
\n of such agreement; or (ii) if such third party files a lawsuit or
\n commences an arbitration or other formal proceeding that asserts an
\n intellectual property claim against Seller.<\/p>\n
2.2.4 Know-How. Seller hereby grants to Buyer a perpetual, fully
\n paid-up, royalty-free, worldwide, non-exclusive license (i) to use the
\n Licensed Know-How in the business and operation of the Group and (ii) to
\n use the Licensed Know-How to make, have made, use, lease, sell, offer
\n for sale, import, design, assemble, have assembled, test or otherwise
\n dispose of Licensed Products to Group Customers.<\/p>\n
2.2.5 Copyright. Seller hereby grants to Buyer a perpetual, fully
\n paid-up, royalty-free, worldwide, nonexclusive license to use,
\n reproduce, prepare derivative works of, and distribute Licensed
\n Copyrightable Materials in conjunction with the marketing or sale of
\n Licensed Products to Group Customers; provided that, all trademarks and
\n trade names of Seller shall be removed, except as otherwise provided in
\n Section 2.4.5, from any Licensed Copyrightable Materials before any
\n distribution thereof.<\/p>\n
2.2.6 Software.<\/p>\n
(a) Seller hereby grants to Buyer a perpetual, fully
\n paid-up, royalty-free, worldwide, non-exclusive license,
\n without the right to grant sublicenses (except as
\n expressly set forth herein), to use, reproduce and
\n prepare derivative works of the Licensed Software and to
\n otherwise use the Licensed Software in the manufacture,
\n sale, design, and support of the Licensed Products to
\n Group Customers.<\/p>\n
(b) Seller hereby grants to Buyer a perpetual, fully
\n paid-up, royalty-free, worldwide, non-exclusive license
\n to distribute or sublicense the Licensed Software (in
\n object code form only) to Subsidiaries, customers or
\n suppliers in <\/p>\n
conjunction with the design, manufacture or sale of
\n Licensed Products to Group Customers. <\/p>\n
(c) Seller hereby grants Buyer a perpetual, fully paid-up,
\n royalty free, worldwide, non-exclusive license to
\n disclose the source code and design documentation for
\n Seller authored Licensed Software to a Governmental
\n Entity for the sole purposes of security certification
\n and independent validation and verification of
\n information assurance and mission-critical software.
\n Buyer agrees that any such disclosure shall be made
\n subject to non-disclosure and confidentiality
\n restrictions.<\/p>\n
2.2.7 Residual Information. Seller agrees that Buyer shall be free to
\n use Residual Information to make, have made, use, lease, offer for sale,
\n import and otherwise dispose of Licensed Products to Group Customers,
\n provided such use is subject to Seller’s rights in patents and
\n copyrights, the license of this Section 2, and Buyer’s confidentiality
\n obligations set forth herein. Buyer acknowledges that the foregoing is
\n not a grant or extension of patent rights.<\/p>\n
2.2.8 Excluded Technology. Buyer acknowledges that the rights granted
\n to Buyer in this IP Agreement do not grant to Buyer any rights in
\n Seller’s technology related to: (i) semiconductor materials (other than
\n semiconductor materials specified by the Group to its semiconductor chip
\n manufacturers for the purpose of radiation hardening semiconductor chips
\n being made by such manufacturers for the Group), semiconductor
\n structures or semiconductor manufacturing processes; and (ii) commercial
\n wireless telephony and systems, commercial two way radios and systems,
\n commercial short messaging and paging services and products, commercial
\n wireless modems, commercial personal communication devices and systems,
\n and commercial local or wide area networks (other than technology
\n embodied in Group Products).<\/p>\n
2.3 Documentation. On or promptly after the Closing Date, Seller agrees
\nto provide to Buyer copies of all available file histories of pending patent
\napplications comprising Assigned Patents, marks and pending trademark and
\nservice mark applications comprising Assigned Trademarks, as well as copies of
\nother documents in Seller’s possession that relate to the maintenance of an
\nAssigned Patent or the registration or registration renewal of an Assigned
\nTrademark or an Assigned Copyright. Upon transfer of such files and
\ndocumentation to Buyer, Buyer assumes all responsibility for the prosecution and
\npayment of fees and all other such activities associated therewith. Buyer shall
\nprepare all paperwork that is necessary to perfect and record the assignments of
\nTransferred IP Assets in the various jurisdictions, and Buyer shall be
\nresponsible for all expenses, including recordation expenses, associated
\ntherewith. Seller agrees to execute such paperwork as needed for perfection.<\/p>\n
2.4 General Intellectual Property Provisions<\/p>\n
2.4.1 Buyer Right to Abandoned Licensed Patents. In the event that,
\n during the two (2) year period following the Closing Date, Seller elects
\n to abandon, or otherwise to no <\/p>\n
longer maintain (other than through failure to maintain due to
\n negligence) any United States Licensed Patents identified on Schedule
\n 2.2.1(d), Seller shall notify Buyer of such and shall grant Buyer the
\n right to take ownership of such Licensed Patent free of charge, except
\n for costs associated with perfecting and recording Buyer’s ownership
\n interest which shall be the sole responsibility of Buyer. Seller shall
\n use reasonable efforts to notify Buyer sufficiently before lapse,
\n abandonment, or loss of right of any Licensed Patent to provide Buyer
\n time to assess the costs and benefits of transferring ownership to Buyer
\n and to provide Buyer time to perfect transfer of ownership prior to any
\n lapse, abandonment, or loss of right if Buyer so elects. The parties
\n agree that in the event Seller fails to notify Buyer prior to
\n abandonment of any United States Licensed Patents identified on Schedule
\n 2.2.1(d) (hereinafter referred to as an “Abandoned Patent”), Seller
\n agrees to petition the United States Patent and Trademark Office for
\n revival of the Abandoned Patent, upon discovery of such abandonment.
\n Buyer’s sole and exclusive remedy for any failure by Seller to maintain
\n any Licensed Patent identified on Schedule 2.2.1(d) shall be the filing
\n by Seller of a petition for revival of such Abandoned Patent as set
\n forth herein. In the event Buyer elects to have ownership of same
\n Licensed Patent transferred to Buyer, Seller agrees to cooperate and
\n assist Buyer to the extent reasonably necessary to affect such transfer.
\n This obligation to notify Buyer, and Buyer’s right to take over
\n ownership, shall also be binding upon any successor in interest of any
\n or all of the Licensed Patents identified on Schedule 2.2.1(d).<\/p>\n
2.4.2 No Implied Rights. Buyer acknowledges and agrees that except as
\n otherwise specifically permitted by this IP Agreement, Buyer is not
\n obtaining any rights in, or to use, any of Seller’s Intellectual
\n Property.<\/p>\n
2.4.3 Disclaimer. Nothing in this IP Agreement shall be construed as
\n requiring the securing or maintaining in force of any intellectual
\n property of either party, except as set forth in paragraph 2.4.1.<\/p>\n
2.4.4 Seller Trademarks, Logos and Trade Names. Buyer acknowledges and
\n agrees that, except for the Transferred IP Assets and except as set
\n forth in paragraph 2.4.5, Buyer shall not use any trademark, logo or
\n trade name of Seller, other than those constituting Transferred IP
\n Assets, or any trademarks, logos or trade names that are confusingly
\n similar thereto or that are a translation or transliteration thereof
\n into any language or alphabet.<\/p>\n
2.4.5 Transitional Use of Seller Trademarks. As soon as practicable
\n following the Closing Date, but not later than one hundred twenty (120)
\n days after the Closing Date, Buyer shall remove and change signage,
\n change and substitute promotional or advertising material in whatever
\n medium, and not later than ninety (90) days after the Closing Date
\n change stationery and packaging and take all other steps as may be
\n required or appropriate to cease use of all such intellectual property
\n or materials bearing intellectual property not owned by Buyer or
\n otherwise constituting a Transferred IP Asset, provided, however, that
\n Buyer shall not be deemed to have violated this provision by reason of
\n (i) its use after the Closing Date of any inventory constituting
\n Transferred IP Assets or (ii) <\/p>\n
the appearance of any trademarks, logos or trade names of Seller in or
\n on any tools, dies, equipment, engineering\/manufacturing drawings,
\n manuals, work sheets, operating procedures, other written materials or
\n other Transferred IP Assets that are used for internal purposes only in
\n connection with the Group, provided that Buyer endeavors to remove such
\n trademarks, logos or trade names in the ordinary course of operation of
\n the Group business.<\/p>\n
2.5 For the avoidance of doubt, nothing contained in this IP
\nAgreement shall be construed as in any way expanding or broadening the scope or
\nduration of Section 8.10, Noncompetition Agreement, of the Asset Purchase
\nAgreement.<\/p>\n
ARTICLE III<\/p>\n
REPRESENTATIONS AND WARRANTIES OF SELLER; INDEMNIFICATION<\/p>\n
3.1 Subject to any rights or licenses granted by Seller prior to the
\nClosing Date, Seller has the right, title or interest necessary to grant to
\nBuyer the assignments and licenses granted herein.<\/p>\n
3.2 Except as set forth on Schedule 3.2, the Transferred IP Assets
\nare free and clear of any Lien except for Permitted Liens.<\/p>\n
3.3 Except as set forth in Schedule 3.3: (i) to Seller’s Knowledge,
\nthere are no material third party licenses to the Transferred IP Assets; (ii) to
\nSeller’s Knowledge, no third party has rights in, or otherwise has the right to
\nrestrict Buyer’s use of the Transferred IP Assets; and (iii) there are no
\npending, or to Seller’s Knowledge, threatened, actions or proceedings
\nchallenging the validity of the Transferred IP Assets.<\/p>\n
3.4 Except as set forth on Schedule 3.4: (a) the Group Products in
\nexistence as of the date hereof and as of the Closing Date do not, to Seller’s
\nKnowledge, infringe upon or misappropriate any patent, trademark, copyright,
\ntrade secret, or other intellectual property or proprietary right of any third
\nparty; and (b) there has been no abandonment of the registered trademarks
\ncomprising the Assigned Trademarks from their dates of first use to the Closing
\nDate.<\/p>\n
3.5 To Seller’s Knowledge, there is not any material defect, virus,
\ntimer, clock, counter, back door, time bomb, or other limiting features
\nincorporated into the Assigned Software or the Licensed Software that would
\nerase data or programming, create a likelihood for a breach of security or
\nconfidentiality, or otherwise inhibit the proper operation of the Assigned
\nSoftware and the Licensed Software and Buyer’s ability to exercise the rights
\ngranted to it herein.<\/p>\n
3.6 Indemnification. This IP Agreement is an integral part of the
\nAsset Purchase Agreement and Seller shall indemnify Buyer for any breach of a
\nrepresentation, warranty or <\/p>\n
covenant in this IP Agreement in accordance with Article VII of the Asset
\nPurchase Agreement.<\/p>\n
3.7 Survival. The applicable survival provision of Article VII of
\nthe Asset Purchase Agreement is incorporated herein by reference and made a part
\nof this IP Agreement.<\/p>\n
3.8 Except as expressly set forth in this IP Agreement, nothing
\nwithin this IP Agreement shall be construed as (i) a warranty or representation
\nby Seller as to the validity and\/or scope of any Transferred IP Asset or
\nLicensed IP Asset; (ii) conferring upon Buyer any license or any other right, by
\nimplication, estoppel or otherwise, under any IP Asset, except as expressly
\ngranted herein; (iii) imposing on Seller any obligation to institute any suit or
\naction for infringement of any IP Asset, or to defend any suit or action brought
\nby a third party that challenges or concerns the validity of any other IP Asset;
\n(iv) a warranty or representation by Seller that any manufacture, use, sale,
\nlease, or other disposition of Licensed Products will be free from infringement
\nof any patent or other intellectual property right; or (v) imposing on Seller
\nany obligation to file any patent application or secure any patent or maintain
\nin force any patent.<\/p>\n
ARTICLE IV<\/p>\n
TERMINATION<\/p>\n
4.1 The applicable termination provisions of Article IX of the Asset
\nPurchase Agreement are incorporated herein by reference and made a part of this
\nIP Agreement.<\/p>\n
4.2 Termination of Agreement. This IP Agreement shall terminate
\nautomatically and without need for further action by either party in the event
\nthat the Asset Purchase Agreement is terminated.<\/p>\n
4.3 Effect of Termination. If this IP Agreement terminates pursuant
\nto Sections 4.1 or 4.2 above, all obligations of the parties hereunder shall
\nterminate without any liability of any party to such other party; provided that
\nnothing herein shall relieve any party from any liability for any breach of this
\nIP Agreement.<\/p>\n
ARTICLE V<\/p>\n
GENERAL PROVISIONS<\/p>\n
5.1 Notices. All notices, requests, demands and other communications
\nhereunder <\/p>\n
shall be in writing, addressed as follows:<\/p>\n
If to Seller: Motorola, Inc.
\n 1301 E. Algonquin Road
\n Schaumburg, Illinois 60196
\n Facsimile No.: (847) 538-2491
\n Attn: Bob McCall<\/p>\n
and<\/p>\n
Motorola, Inc.
\n Law Department
\n 1303 E. Algonquin Road
\n Schaumburg, Illinois 60196
\n Facsimile No.: (847) 576-3750
\n Attn: Asst. General Counsel
\n V.P. Intellectual Property<\/p>\n
with a copy (which shall not constitute notice) to:<\/p>\n
Wiley, Rein & Fielding
\n 1776 K Street, N.W.
\n Washington, D.C. 20006
\n Facsimile No.: (202) 719-7049
\n Attn: Rand Allen<\/p>\n
If to Buyer: General Dynamics Corporation
\n 3190 Fairview Park Drive
\n Falls Church, VA 22042
\n Facsimile No.: (703) 876-3554
\n Attn: David A. Savner<\/p>\n
with a copy (which shall not constitute notice) to:<\/p>\n
Jenner & Block, LLC
\n One IBM Plaza
\n Chicago, IL 60611
\n Facsimile No.: (312) 840-8711
\n Attn: Thomas A. Monson<\/p>\n
or to such other address as Buyer or Seller may designate by written notice to
\nthe other party hereto. Any such notices, requests, demands or other
\ncommunications shall be deemed to have <\/p>\n
been duly given when received if delivered personally or, if mailed, on the date
\nfive (5) days after the date so deposited in the mails, postage prepaid, return
\nreceipt requested or on the day following the day sent if sent by prepaid
\novernight delivery service. Notices, requests, demands and other communications
\nhereunder may be delivered by facsimile transmission if confirmation by sender
\nis made within three (3) business days thereafter. All periods of notice will be
\nmeasured from the date of deemed delivery thereof.<\/p>\n
5.2 Nondisclosure. Neither Buyer nor Seller shall issue any press
\nrelease or make any other public disclosure (including disclosure to public
\nofficials) with respect to this IP Agreement or the transactions contemplated by
\nthis IP Agreement, except as required by law, without the prior written approval
\nof the other party, which approval shall not be unreasonably withheld; provided,
\nthat either party may, if considered necessary by its counsel to fulfill its
\nobligations as a publicly traded corporation, respond to inquiries and issue
\nsuch releases as it considers necessary and appropriate, if it notifies the
\nother party in advance of the substance of such proposed response or proposed
\nrelease and gives such party reasonable opportunity for comment prior to such
\nresponse or release.<\/p>\n
5.3 Dispute Resolution. Section 10.5, Dispute Resolution, of the
\nAsset Purchase Agreement is incorporated herein by reference and is made a part
\nof this IP Agreement.<\/p>\n
5.4 Limitation of Liability. Section 10.6, Limitation of Liability,
\nof the Asset Purchase Agreement is incorporated herein by reference and made a
\npart of this Agreement.<\/p>\n
5.5 Confidentiality.<\/p>\n
5.5.1 Notwithstanding, and in addition to, the terms of Section 8.6 of
\n the Asset Purchase Agreement, Buyer and Seller hereby agree to the
\n confidentiality provisions set forth in this Section 5.5. The Seller
\n Licensed Know-How, the pending patent applications constituting part of
\n the Licensed Patents, the Licensed Software and any information
\n designated as “Motorola Confidential Proprietary” or similar legend is
\n the Confidential Information of Seller or its licensor. The Assigned
\n Invention Disclosures, the pending patent applications constituting part
\n of the Assigned Patents, the Assigned Know-How, and the Assigned
\n Software are the Confidential Information of Buyer. For a period of five
\n (5) years from the Closing Date, each party agrees to use the same care
\n and discretion, but at least reasonable care and discretion, to avoid
\n disclosure, publication, or dissemination of the other party’s
\n Confidential Information as each party employs with similar information
\n of its own which it does not desire to publish, disclose or disseminate,
\n unless it is in connection with that party’s business and provided that
\n the third party executes a confidentiality agreement having
\n substantially the same obligations as these confidentiality provisions.<\/p>\n
5.5.2 Each party shall notify the other party immediately upon
\n discovery of any unauthorized use or disclosure of the other party’s
\n Confidential Information, and will cooperate with the other party in
\n every reasonable way to help the other party regain possession of such
\n Confidential Information and to prevent its further unauthorized use.<\/p>\n
Each party agrees that the Confidential Information of the other party
\n shall not be exported directly or indirectly to any restricted country
\n without the prior written consent of the Office of Export Control for
\n the USA Department of Commerce.<\/p>\n
5.5.3 Notwithstanding the other provisions of this IP Agreement, the
\n non-disclosure obligations specified in Section 5.5 shall not apply to
\n information that:<\/p>\n
(a) is available to the public on the Closing Date, or
\n thereafter becomes available to the public other than as
\n a result of a breach of this Section 5.5;<\/p>\n
(b) is disclosed by the party owning the Confidential
\n Information to a third party without an obligation of
\n confidence;<\/p>\n
(c) can be shown by the receiving party to have been
\n developed by it independently of this IP Agreement; or<\/p>\n
(d) can be shown by the receiving party to have been
\n rightfully received completely independently from a
\n third party without any obligation of confidence.<\/p>\n
5.5.4 Disclosure of Confidential Information shall not be precluded,
\n if such disclosure is:<\/p>\n
(a) in response to a valid order of a court or other
\nofficial governmental body; provided, however, that the party subject to the
\nvalid order shall first have given notice to the party owning the Confidential
\nInformation and made a reasonable effort to obtain a protective order requiring
\nthat the information and\/or documents so disclosed be used only for the purposes
\nfor which the order was issued;<\/p>\n
(b) required by any law or any regulatory body; or<\/p>\n
(c) necessary to establish rights under this IP Agreement.<\/p>\n
5.5.5 Subject to the need to know in relation to the purpose for which
\n a party has provided the other party its Confidential Information, a
\n party may disclose Confidential Information to its Subsidiaries,
\n Affiliates or third party licensees; provided however, that such
\n Subsidiaries, Affiliates or third party licensees undertake to be bound
\n by the terms of this Section 5.5 as if named herein in place of the
\n respective party.<\/p>\n
5.6 Miscellaneous. Section 10.9, Miscellaneous, of the Asset
\nPurchase Agreement is incorporated by reference and is made a part of this IP
\nAgreement except as set forth below:<\/p>\n
Successors and Assigns. This IP Agreement inures to the benefit
\n of, and is binding upon, the successors, permitted assigns, and personal
\n representatives of the parties hereto. Neither party may assign its
\n rights or obligations under this IP Agreement without the express
\n written consent of the other party, except that Buyer may, without the
\n prior written consent of Seller, assign its rights under this IP
\n Agreement to any Buyer Subsidiary, provided that Buyer shall remain
\n liable for all of its obligations under this IP Agreement. In the event
\n of an assignment, the assignee Subsidiary, pursuant to Section 2.2.1(b),
\n shall only have the right to sublicense to entities that satisfy the
\n definition of a Buyer Subsidiary under this IP Agreement.<\/p>\n
[SIGNATURE PAGE FOLLOWS]<\/p>\n
SIGNATURE PAGE TO INTELLECTUAL PROPERTY AGREEMENT<\/p>\n
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
\nIP Agreement with legal and binding effect as of the date and year first above
\nwritten.<\/p>\n
SELLER: MOTOROLA, INC.<\/p>\n
By: \/s\/Keith Bane
\n ———————————<\/p>\n
Name: Keith Bane
\n ——————————-<\/p>\n
Title: Executive Vice President
\n ——————————<\/p>\n
BUYER: GENERAL DYNAMICS CORPORATION<\/p>\n
By: \/s\/Ken Dahlberg
\n ———————————<\/p>\n
Name: K. C. Dahlberg
\n ——————————-<\/p>\n
Title: Executive Vice President
\n ——————————<\/p>\n
EXHIBIT C<\/p>\n
EMPLOYEE MATTERS AGREEMENT<\/p>\n
(Amended and Restated as of September 24, 2001)<\/p>\n
This Employee Matters Agreement (“Agreement”), originally made as of
\nAugust 6, 2001 by and between MOTOROLA, INC., a Delaware corporation (“Seller”),
\nand GENERAL DYNAMICS CORPORATION, a Delaware corporation (“Buyer” and together
\nwith Seller, the “Parties”), is hereby amended and restated as of this 24th day
\nof September 2001.<\/p>\n
WITNESSETH:<\/p>\n
WHEREAS, the Parties have entered into the Asset Purchase Agreement
\ndated August 6, 2001 (the “Purchase Agreement”) providing for, among other
\nthings, the sale and assignment by Seller to Buyer of certain assets and the
\nassumption by Buyer from Seller of certain liabilities, used in the business and
\noperation of the Group (as defined in the Purchase Agreement); and<\/p>\n
WHEREAS, certain persons who work in or are assigned to the Group and
\nare directly employed by Seller or its Affiliates shall become employees of
\nBuyer or its Affiliates pursuant to this Agreement or pursuant to the operation
\nof local laws; and<\/p>\n
WHEREAS, the Parties hereto wish to set forth their agreement as to
\ncertain matters regarding the treatment of, and the compensation and employee
\nbenefits provided to those employees of Seller who become employees of Buyer as
\ndescribed above;<\/p>\n
NOW, THEREFORE, in consideration of the premises and of the mutual
\nrepresentations, warranties, covenants and conditions contained herein and in
\nthe Purchase Agreement and for other good and valuable consideration, the
\nreceipt and adequacy of which is hereby acknowledged, the Parties hereby agree
\nwith legal and binding effect as follows:<\/p>\n
I DEFINITIONS<\/p>\n
Except as otherwise expressly provided herein, all capitalized terms
\nused herein shall have the respective meanings assigned to them in the Purchase
\nAgreement or in the preceding portions of this Agreement. In addition, the
\nfollowing terms, as used herein, shall have the following meanings:<\/p>\n
1.1. “Buyer Non-U.S. Plans” shall mean Employee Benefit Plans
\nand programs established by Buyer to provide those benefits for Non-U.S.
\nTransferred Employees required under this Agreement.<\/p>\n
1.2. “Buyer U.S. Plans” shall mean Employee Benefit Plans and
\nprograms established by Buyer to provide those benefits for U.S. Hired Employees
\nrequired under this Agreement.<\/p>\n
1.3. “Cause” shall mean poor performance or any misconduct
\nidentified as a ground for termination in Buyer’s human resources policies, code
\nof business conduct or other written policies, practices or procedures.<\/p>\n
1.4. “Closing Date” shall have the meaning ascribed to it in the
\nPurchase Agreement, and for purposes of this Agreement all acts and transactions
\nto be taken or effected at the Closing shall be deemed to be effective as of
\n10:00 a.m. Central Standard Time on that date.<\/p>\n
1.5. “Controlled Group Member” means, as to Seller or Buyer, any
\nother entity which either is part of a controlled group of corporations which
\nincludes that Party or is a trade or business under common control with that
\nParty, as defined in Sections 414(b) and (c) of the Code.<\/p>\n
1.6. “Employee Benefit Plan” shall mean:<\/p>\n
(a) any plan, fund, or program which provides health, medical,
\nsurgical, hospital or dental care or other welfare benefits, post-retirement
\nmedical or life insurance, life insurance, other insurance plan, benefits in the
\nevent of sickness, accident, disability or death, apprenticeship or other
\ntraining programs, or day care centers, scholarship funds, or prepaid legal
\nservices,<\/p>\n
(b) any plan, fund, or program which provides pensions,
\nprofit-sharing, or retirement income to employees or results in a deferral of
\nincome by employees for periods extending to the termination of covered
\nemployment or beyond,<\/p>\n
(c) any plan, fund, agreement or program relating to employment,
\nnon-competition or changes-in-control or which provides severance, unemployment,
\nsupplemental unemployment, vacation or fringe benefits (including dependent and
\nhealth care accounts),<\/p>\n
(d) any incentive compensation plan, bonus plan or arrangement,
\ndeferred compensation plan, excess benefit plan, stock ownership, stock option
\nor stock-based incentive or compensation plan, or stock purchase plan, and<\/p>\n
(e) any other benefit plan, program, agreement, fund or
\narrangement for the benefit of employees and former employees (including without
\nlimitation, any funding or insurance arrangement related to any such program or
\nplan described herein), whether written or unwritten, qualified or
\nnon-qualified, funded or unfunded.<\/p>\n
1.7. “ERISA” means the Employee Retirement Income Security Act
\nof 1974, as amended, and the regulations thereunder.<\/p>\n
1.8. “Hired Employee” shall mean any U.S. Hired Employee and any
\nNon-U.S. Transferred Employee.<\/p>\n
1.9. “Non-U.S. Transferred Employee” shall mean each person who
\n(i) immediately prior to the Closing Date is an employee of Seller or its
\nAffiliates assigned to (or, to the extent identified as such in Schedule 1.9, in
\nsupport of) the Group on a non-U.S. payroll, and (ii) is transferred to
\nemployment with Buyer or a Buyer Affiliate effective as of the Closing Date.
\nEach such person shall be listed on Schedule 1.9 to be completed at the Closing
\nDate.<\/p>\n
1.10. “Seller Non-U.S. Plans” shall mean Seller’s Employee
\nBenefit Plans in which the Non-U.S. Transferred Employees have been eligible to
\nparticipate prior to the Closing Date which are set forth and identified as such
\non Schedule 1.10.<\/p>\n
1.11. “Seller Pension Plan Participants” shall mean active
\nparticipants in the Seller Pension Plan described in Section 2.8 below as of the
\nClosing Date who are also U.S. Hired Employees.<\/p>\n
1.12. “Seller U.S. Employee” shall mean each person who
\nimmediately prior to the Closing Date is an active employee of Seller or its
\nAffiliates assigned to (or, to the extent identified as such in Schedule 1.12,
\nin support of) the Group on a U.S. payroll and who is listed on Schedule 1.12,
\nexcept that the term “Seller U.S. Employee” shall not include any employee of
\nSeller who is on inactive or long-term disability status as of the Closing Date
\nother than those employees who are on routine vacation, leave under the Family
\nand Medical Leave Act, military leave, or short-term disability on the Closing
\nDate and who are identified as such on Schedule 1.12. Schedule 1.12 shall
\nseparately list any Group employee as of the Closing Date who is not a Seller
\nU.S. Employee by reason of his or her inactive or long-term disability status.<\/p>\n
1.13. “Seller U.S. Plans” shall mean Seller’s Employee Benefit
\nPlans in which the U.S. Hired Employees have been eligible to participate
\nimmediately prior to the Closing Date and which are set forth and identified as
\nsuch on Schedule 1.13.<\/p>\n
II U.S. HIRED EMPLOYEE MATTERS<\/p>\n
2.1. U.S. Hired Employees.<\/p>\n
(a) Prior to the Closing Date, Buyer will have extended or
\ncaused its Affiliates to extend an offer of employment to each Seller U.S.
\nEmployee that is substantially comparable to the position held by such Seller
\nU.S. Employees immediately prior to the Closing Date. All offers of employment
\nwill be conditioned on Seller U.S. Employees executing confidentiality and
\nnon-competition agreements that are substantially similar to those required by
\nSeller. Such Seller U.S. Employees who accept Buyer’s offer of employment
\neffective as of the Closing Date shall be known as “U.S. Hired Employees”. Each
\nU.S. Hired Employee shall be listed on Schedule 2.1 which shall be completed by
\nSeller on the Closing Date. Notwithstanding anything to <\/p>\n
the contrary, if any U.S. Hired Employee who is on short-term disability status
\nas of the Closing Date goes onto long-term disability status within one year of
\nthe Closing Date, then such individuals shall cease to be treated as U.S. Hired
\nEmployees as of the commencement date of their long-term disability status and
\nSeller shall retain full responsibility and liability for any such persons as of
\nsuch commencement date. If any persons who are not Seller U.S. Employees by
\nreason of being on inactive or long-term disability status as described in
\nSection 1.12 return to active work status within one year of the Closing Date,
\nBuyer shall extend offers of employment to such persons and such persons shall
\nbe treated as U.S. Hired Employees effective as of their date of hire for all
\npurposes under this Agreement, including, without limitation, pension and
\nretiree medical asset and liability transfers. Seller shall retain full
\nresponsibility and liability for any such persons on inactive or long-term
\ndisability status unless and until they are hired by Buyer in accordance with
\nthe immediately preceding sentence.<\/p>\n
(b) On the Closing Date, Buyer will hire each Seller U.S.
\nEmployee listed on Schedule 2.1. In connection therewith, Seller (i) shall not
\ninterfere with Buyer’s solicitation of such employees of the Group, (ii) shall
\nnot cause or permit the hiring (or engagement as an independent contractor or
\nleased employee) of any Seller U.S. Employee by or on behalf of any other
\ndivision, unit or Affiliate of Seller during the period between the date of this
\nAgreement and the Closing Date (except as permitted in writing by Buyer), nor
\ncause or permit the Group to hire (or engage as independent contractor or leased
\nemployee) any employee of Seller, or of any Affiliate of Seller, who is employed
\nor engaged by any division, unit or Affiliate of Seller other than the Group,
\nduring the period between the date of this Agreement and the Closing Date
\n(except as permitted in writing by Buyer), and (iii) shall provide such
\nassistance as Buyer may reasonably request in connection with such solicitation,
\nprovided that Buyer shall reimburse Seller for any reasonable out-of-pocket
\nexpenses incurred by Seller in connection with such assistance. Notwithstanding
\nthe foregoing, for a period of one year following the Closing Date, neither
\nBuyer nor any of its Affiliates will employ (or engage as an independent
\ncontractor) any Seller U.S. Employee who refuses the offer of employment
\nextended by Buyer or its Affiliates pursuant to this Section 2.1, or any
\nindividual whose employment with the Group terminated between the dates of this
\nAgreement and the Closing Date.<\/p>\n
2.2. Compensation and Benefits. Buyer will compensate each U.S.
\nHired Employee (while employed by Buyer) for the period beginning as of the
\nClosing Date and ending as of December 31, 2002 as follows:<\/p>\n
(a) at a base wage or base salary rate which shall not be less
\nthan that provided by Seller or its Affiliates, as applicable immediately prior
\nto the Closing Date (subject to and including increases in base wage and salary
\nrates resulting from Seller’s scheduled October 2001 merit review targeting an
\naverage 4.5% average increase therein, and any other routine pay increases),<\/p>\n
(b) with cash incentive and other cash-based variable pay
\nprograms which shall be substantially comparable in the aggregate to those
\navailable to that employee from Seller or its Affiliates (and identified on
\nSchedule 2.2(b)), as applicable immediately prior to the Closing Date, and<\/p>\n
(c) with employee benefit programs that are substantially
\ncomparable in the aggregate on an economic basis (such benefits need not be
\nidentical to those Seller U.S. Plans in effect immediately prior to the Closing
\nDate) to the benefits provided under the Seller U.S. Plans in effect immediately
\nprior to the Closing Date, except that such covenant shall not apply to:<\/p>\n
(i) any equity-based compensation plan or program; provided,
\n that Buyer will apply to the Group an equity-based compensation program
\n substantially comparable to the equity-based compensation program
\n offered at other business units of Buyer; or<\/p>\n
(ii) the Motorola Elected Officers Supplementary Retirement
\n Plan.<\/p>\n
Except as otherwise agreed to in writing by the Parties, to the extent
\n that benefit programs covering U.S. Hired Employees are being
\n administered by Seller on or after the Closing Date in accordance with
\n Sections 2.2(c) and 2.9, such programs will be amended to reflect in
\n whole any applicable changes in the Seller U.S. Plans as provided to
\n similarly situated Seller employees or retirees (including without
\n limitation changes in vendors, services, providers, co-payments,
\n deductibles, lifetime maximums, types of coverage, etc.).
\n Notwithstanding the foregoing, in the event that Seller increases its
\n retiree medical cost caps for 2002, Seller agrees to administer Buyer’s
\n retiree medical plan using cost caps referred to in Section 5.2(q)
\n herein, provided that Buyer’s plan is identical to Seller’s plan in all
\n other respects and that Buyer reimburses Seller for increased costs due
\n to such administration. To the extent that Buyer is administering the
\n Buyer U.S. Plans during 2002, Buyer may reduce benefit levels provided
\n in Section 2.2(c) above to the extent that Seller reduces benefit levels
\n of similar programs for similarly situated employees.<\/p>\n
Notwithstanding the foregoing provisions of this Section 2.2, to the extent
\naccrued through the Closing Date, Buyer shall be solely responsible for any
\nincentive compensation payments to Hired Employees with respect to services
\nrendered during the entire 2001 plan year, including those payments they would
\nhave received under Seller’s scheduled incentive compensation programs with
\nrespect to the portion of the 2001 plan year prior to Closing, had they
\ncontinued to be employed by Seller throughout that year.<\/p>\n
2.3. Severance. Without limiting anything in Section 2.2 herein
\nand consistent therewith, through the period ending on December 31, 2002, if any
\nU.S. Hired Employee is terminated by Buyer (other than for Cause) Buyer will
\nprovide such employee with a severance benefit under a Buyer U.S. Plan that is
\nsubstantially <\/p>\n
comparable to the benefit provided under the Motorola, Inc. Involuntary
\nSeverance Plan then in effect but not to exceed the benefit levels in effect as
\nof the Closing Date, a copy of which is attached hereto as Exhibit 2.3, provided
\nthat Buyer may require a release of claims for any and all benefits provided
\nunder this Section 2.3.<\/p>\n
2.4. Vacation.<\/p>\n
(a) Until the Closing Date, the vacation policy of Seller shall
\ncontinue to apply to all U.S. Hired Employees. Thereafter Buyer shall assume and
\nfulfill, in a timely manner, all Seller’s obligations and liabilities related to
\nthe U.S. Hired Employees under Seller’s vacation policy, including allowing U.S.
\nHired Employees to use and be paid for their accrued but unused vacation time
\nfrom their prior employment with the Seller, as recognized and available under
\nSeller’s vacation policy, even after the Closing Date, provided that, after said
\nDate, any new entitlement to vacation time will be accrued and used only in
\naccordance with Buyer’s own vacation policy.<\/p>\n
(b) Until the Closing Date, the “Attendance Bonus Plan” of
\nSeller shall continue to apply to all U.S. Hired Employees. Thereafter Buyer
\nshall assume and fulfill, in a timely manner, all Seller’s obligations and
\nliabilities related to the U.S. Hired Employees under Seller’s Attendance Bonus
\nPlan, including allowing U.S. Hired Employees to be paid their accrued but
\nunpaid attendance bonus under Seller’s Attendance Bonus Plan, even after the
\nClosing Date, subject to any customary withholding for federal, state and local
\ntaxes, provided that, after said Closing Date, any new entitlement to an
\nattendance bonus or its equivalent will be accrued and payable only in
\naccordance with Buyer’s own attendance bonus plan or comparable program.<\/p>\n
2.5. Responsibility for Employees.<\/p>\n
(a) Except as otherwise provided for in this Agreement, for U.S.
\nHired Employees, Buyer shall assume and thereafter pay, perform and discharge
\nany and all employment, compensation and employee benefit liabilities,
\nresponsibilities and obligations of Seller and any of its Affiliates including,
\nwithout limitation, any and all claims of employment discrimination under any
\nlocal, state, or federal law or ordinance, including, without limitation, Title
\nVII of the Civil Rights Act of 1964, as amended; the Civil Rights Act of 1991;
\nthe Americans with Disabilities Act of 1990; the Age Discrimination in
\nEmployment Act of 1967, as amended by the Older Workers Benefit Protection Act
\nof 1990; Section 510 of ERISA and the Arizona Civil Rights Act, which
\nliabilities, responsibilities and obligations are incurred as the result of
\nincidents occurring after the Closing. In the event that Seller or an Affiliate
\nof Seller or any Employee Benefit Plan maintained by Seller or any of its
\nAffiliates directly or indirectly incurs any costs, liabilities, obligations or
\nlegal expenses related to any such incidents occurring after the Closing, Buyer
\nshall reimburse and indemnify Seller and its Affiliates for any and all such
\ncosts, liabilities, obligations and expenses immediately upon the demand of
\nSeller.<\/p>\n
(b) Except as otherwise provided for in this Agreement, Seller
\nshall remain liable and shall pay, perform and discharge any and all employment,
\ncompensation and employee benefit liabilities, responsibilities and obligations
\nof Seller and any of its Affiliates including, without limitation, any and all
\nclaims of employment discrimination under any local, state, or federal law or
\nordinance, including, without limitation, Title VII of the Civil Rights Act of
\n1964, as amended; the Civil Rights Act of 1991; the Americans with Disabilities
\nAct of 1990; the Age Discrimination in Employment Act of 1967, as amended by the
\nOlder Workers Benefit Protection Act of 1990; Section 510 of ERISA and the
\nArizona Civil Rights Act, which liabilities, responsibilities and obligations
\nare incurred as the result of incidents occurring prior to the Closing,
\nregardless of whether claims are made or reported prior to the Closing. In the
\nevent that Buyer or an Affiliate of Buyer or any Employee Benefit Plan
\nmaintained by Buyer or any of its Affiliates directly or indirectly incurs any
\ncosts, liabilities, obligations or legal expenses related to any such incidents
\noccurring prior to the Closing, Seller shall reimburse and indemnify Buyer and
\nits Affiliates for any and all such costs, liabilities, obligations and expenses
\nimmediately upon the demand of Buyer.<\/p>\n
2.6. Service Credit. Buyer shall, and shall cause its Affiliates
\nto, provide each U.S. Hired Employee with full credit under the Buyer U.S.
\nPlans, for pre-Closing (i) service with Seller and its Affiliates and Controlled
\nGroup Members, and (ii) service other than with Seller and its Affiliates and
\nControlled Group members, to the same extent as such employee was entitled,
\nbefore the Closing Date, to credit for such service under any similar Seller
\nU.S. Plan, provided that such credit does not result in any duplication of
\nbenefits.<\/p>\n
2.7. 401(k) Plan.<\/p>\n
(a) Effective as of the Closing Date, the U.S. Hired Employees
\nshall cease to participate in the Motorola, Inc. 401(k) Profit Sharing Plan (the
\n“Seller 401(k) Plan”), and shall be eligible to commence participation in a
\ndefined contribution retirement plan permitting deferrals under Section 401(k)
\nof the Code that is sponsored by the Buyer (the “Buyer 401(k) Plan”) as soon as
\nadministratively practicable following the Closing Date. Any minimum age or
\nservice requirements contained in the Buyer 401(k) Plan with respect to
\neligibility to participate generally or eligibility to share in any employer
\ncontributions thereunder shall be waived for U.S. Hired Employees who
\nimmediately prior to the Closing Date were eligible to participate or share in
\nemployer contributions, respectively, under the Seller 401(k) Plan. If for any
\nperiod after the Closing Date the plan administrator of the Buyer 401(k) Plan
\nrelies upon compensation reduction elections and investment directions made by
\nU.S. Hired Employees under the Seller 401(k) Plan prior to the Closing Date,
\nBuyer agrees to defend and indemnify Seller for all liabilities, damages, costs
\nor expenses incurred by Seller as a result of claims arising from such reliance.<\/p>\n
(b) All matching contributions with respect to the U.S. Hired
\nEmployees’ contributions to the Seller 401(k) Plan shall be contributed to the
\nSeller 401(k) plan in accordance with the Seller’s usual practices. Further, the
\nSeller shall cause all U.S. Hired Employees to be fully vested in 100% of their
\naccount balances (including any amounts contributed under Section 2.7(d) below).<\/p>\n
(c) Seller will permit each U.S. Hired Employee to elect a
\ndistribution of his or her account balance in the Seller 401(k) Plan, pursuant
\nto the provisions of Sections 401(k)(2)(B)(i)(II) and 401(k)(10)(A)(ii) of the
\nCode, until the end of the second calendar year after the year in which the
\nClosing Date occurs (or such longer period of time as permitted under the Code).
\nBuyer will cause the Buyer 401(k) Plan to accept a direct rollover of, or an
\neligible rollover distribution of, all or a portion of the taxable portion of a
\ndistribution of a U.S. Hired Employee’s account balance from the Seller 401(k)
\nPlan, including any outstanding loans and related promissory notes. Seller shall
\ncause the Seller 401(k) Plan to permit repayment by payroll withholding for
\n2001, and by coupon repayment thereafter, of any outstanding loan from an
\naccount balance in the Seller 401(k) Plan from which a U.S. Hired Employee does
\nnot take a distribution that includes that outstanding loan. The Parties shall
\ncooperate to effect the purpose of this previous sentence.<\/p>\n
(d) If, following the end of the 2001 Plan Year, Seller
\ndetermines that a “Profit Sharing Contribution” (as defined in the Seller 401(k)
\nPlan) is payable to the Seller 401(k) Plan pursuant to the terms of the Seller
\n401(k) Plan, then subject to all legal or other applicable limits, Seller shall
\nmake such Profit Sharing Contribution to the Seller 401(k) Plan in accordance
\nwith the terms of the Seller 401(k) Plan, and the pro rata share of such
\ncontribution attributable to the U.S. Hired Employees determined under Section
\n10.4(e) of the Seller 401(k) Plan shall be allocated to the accounts of such
\nU.S. Hired Employees.<\/p>\n
2.8. Seller Pension Plan and Buyer Pension Plan. The Parties
\nshall enter into the “Pension Transfer Agreement” which shall be executed by the
\nParties and attached to this Agreement as Exhibit 2.8 thereto upon execution of
\nthis Agreement.<\/p>\n
2.9. Health and Welfare Plans.<\/p>\n
(a) In accordance with, and toward the satisfaction of, the
\nrequirements of Section 2.2(c) herein, the U.S. Hired Employees shall continue
\nto participate, without interruption, in those Seller U.S. Plans set forth in
\nSchedule 2.9 (the “Transitional Welfare Plans”) through December 31, 2001 (such
\nschedule to be provided by Buyer within 15 days of execution of this Agreement).
\nThereafter, Buyer shall establish Employee Benefit Plans to provide benefits
\nrequired under Section 2.2(c) of this Agreement and the following provisions of
\nthis Section 2.9. At the request of Buyer, and to the extent that Buyer
\nestablishes plans identical to the Transitional Welfare Plans, Seller agrees to
\nadminister such plans through the period ending December 31, 2002 (including any
\napplicable run-out). Any new Group employee hired during the <\/p>\n
period after Closing during which the U.S. Hired Employees remain covered under
\nthe Transitional Welfare Plans shall be allowed to participate in the
\nTransitional Welfare Plans in accordance with the respective terms. However, if
\nBuyer elects to administer its own benefit plans and programs on or after
\nJanuary 1, 2002 to satisfy the requirements of Section 2.2(c) hereof, then the
\nU.S. Hired Employees and any new Group employees shall participate instead in
\nsuch Buyer plans and programs on and after that date. Buyer shall reimburse
\nSeller for its costs incurred fulfilling its obligations described in this
\nSection 2.9(a) in accordance with the reimbursement methods described in the
\nTransition Services Agreement.<\/p>\n
(b) With respect to medical, dental and other health and welfare
\nbenefit plans maintained by Buyer covering U.S. Hired Employees as required
\nunder Section 2.2.(c), Buyer shall waive any waiting period, pre-existing
\ncondition, evidence of insurability, continuing-course-of-treatment, and
\nactively-at-work requirements to the same extent that such period, conditions
\nand\/or requirements were not applicable to or had been satisfied by such U.S.
\nHired Employees immediately prior to the Closing Date under applicable Seller
\nU.S. Plans.<\/p>\n
2.10. Retiree Medical Coverage. The Parties shall enter into the
\n“401(h) Transfer Agreement” which shall be executed by the Parties and attached
\nto this Agreement as Exhibit 2.10 thereto upon execution of this Agreement.<\/p>\n
2.11. Nonqualified Plans. Buyer will assume Seller’s
\nobligations, duties and liabilities to all U.S. Hired Employees with respect to
\ntheir participation in the Motorola Supplemental Pension Plan (“MSPP”) as of the
\nClosing Date. Seller will transfer from its rabbi trust related to the MSPP to
\nBuyer’s applicable rabbi trust cash in an amount which bears the same proportion
\nto the fair market value of all of the assets of Seller’s rabbi trust as of the
\nClosing Date, as the CAS actuarial accrued liability for U.S. Hired Employees
\nparticipating in the Motorola Supplemental Pension Plan determined as of the
\nClosing Date (based on assumptions used by Seller for CAS cost purposes for the
\nyear ended December 31, 2001) bears to the total such liability for all
\nparticipants in the MSPP, plus interest on such amount from the Closing Date
\nthrough the date of transfer, at an annual rate equal to the 30-year U.S.
\nTreasury bond rate as of the Closing Date.<\/p>\n
2.12. Workers’ Compensation. Responsibility for workers’
\ncompensation claims in respect of the Group arising out of conditions having a
\ndate of injury (or, in the case of a claim relating to occupational illness or
\ndisease, the last significant exposure) prior to the Closing Date shall remain
\nwith Seller. Buyer shall have responsibility for workers’ compensation claims in
\nrespect of the Group arising out of conditions having a date of injury (or, in
\nthe case of a claim relating to occupational illness or disease, the last
\nsignificant exposure) on or after the Closing Date.<\/p>\n
2.13. WARN Act Compliance. Buyer shall retain full
\nresponsibility for any violation of the Worker’s Adjustment and Retraining
\nNotification Act of 1988, as <\/p>\n
amended, arising from Buyer’s failure to comply with Section 2.1 or its
\noperation of the Group after the Closing, and shall indemnify Seller for any
\nliability, expense and cost related thereto, including reasonable attorneys’
\nfees related thereto. Seller will provide Buyer on or prior to the Closing Date
\nwith a written list of all employees of the Group whose employment has been
\nterminated or whose work hours have been reduced within 90 calendar days
\npreceding the Closing Date. Such list will indicate the total number of
\nemployees affected, the employee’s site of employment, and date of employment
\nloss.<\/p>\n
2.14. Payroll Matters. The Seller and Buyer agree that they will
\ncooperate in the transition of payroll tax withholding and reporting and will
\nseek to accomplish such transition in a manner that will minimize the tax
\neffects on the U.S. Transferred Employees, to the extent administratively
\npracticable.<\/p>\n
III NON-U.S. TRANSFERRED EMPLOYEE MATTERS<\/p>\n
3.1. Non-U.S. Transferred Employees. Wherever legally
\npermissible, on the Closing Date, the Non-U.S. Transferred Employees shall
\nbecome employees of the applicable Buyer Affiliate by operation of applicable
\nlocal law and\/or pursuant to the terms of any necessary transfer agreement
\nrelating to that jurisdiction. Where such transfer is not possible in the manner
\ndescribed in the previous sentence, the applicable Buyer Affiliate shall offer
\nNon-U.S. Transferred Employees employment in accordance with the procedures
\nrequired by applicable local law to effectuate their employment with the
\nappropriate Buyer Affiliate commencing on the Closing Date. Seller shall not
\ninterfere with Buyer’s solicitation of such employees of the Group, and Seller
\nshall provide such assistance as Buyer may reasonably request in connection with
\nsuch solicitation, provided that Buyer shall reimburse Seller for any reasonable
\nout-of-pocket expenses incurred by Seller in connection with such assistance. To
\nthe extent any notification or consultation requirements are imposed by
\napplicable law with regard to the transaction contemplated by this Agreement and
\nas regards Non-U.S. Transferred Employees, Buyer or applicable Buyer Affiliates
\nagree to cooperate fully with Seller or its Affiliates to ensure that such
\nnotification or consultation requirements are carried out. Notwithstanding the
\nforegoing, but subject to any requirements of applicable local law, for a period
\nof one year following the Closing Date, neither Buyer nor its Affiliates will
\nemploy (or engage as an independent contractor) any Non-U.S. Transferred
\nEmployee who refuses the offer of employment extended by Buyer or its Affiliate
\npursuant to this Section 3.1, or any individual whose employment with the Group
\nterminated between the date of this Agreement and the Closing Date.<\/p>\n
3.2. Compensation.<\/p>\n
(a) Schedule 3.2 sets forth certain terms and conditions of
\nemployment and material employee benefit plans for the Non-U.S. Transferred
\nEmployees in effect immediately prior to the Closing Date.<\/p>\n
(b) In jurisdictions where applicable law would require any of
\nBuyer’s Affiliates to offer continued employment as of the Closing Date to
\nNon-U.S. Transferred Employees on specific terms and conditions that are
\ndetermined by comparison to the terms and conditions provided by the applicable
\nSeller Affiliate to such Non-U.S. Transferred Employees immediately prior to the
\nClosing Date in order to avoid liability for severance or other termination
\ncompensation or damages, and under applicable law such Non-U.S. Transferred
\nEmployee is or becomes entitled to severance, other termination compensation or
\nbenefits on or after the Closing Date for which Seller is held liable or Seller
\nor its Affiliates is or are subject to damages as a result of the failure of the
\nterms of such offer of employment to comply with applicable law, the applicable
\nBuyer Affiliate will be responsible for, and will indemnify Seller and its
\nAffiliates from and against any and all claims for severance compensation,
\nbenefits, damages or compensation for unfair or wrongful dismissal, together
\nwith all costs and expenses arising from such claims by such Non-U.S.
\nTransferred Employees.<\/p>\n
(c) In those jurisdictions where Seller’s Affiliates have
\nhistorically followed a practice of paying non-incentive salary bonuses to their
\nemployees or such bonuses are required by applicable law, Seller shall cause its
\napplicable Affiliates to pay to each of their respective Non-U.S. Transferred
\nEmployees the pro rata portion of all such bonuses (if any) to which such
\nNon-U.S. Transferred Employee is entitled, for the period beginning on the first
\nday of the applicable accrual period and ending on the day immediately prior to
\nthe Closing Date, which payment shall be made within a reasonable period of time
\nfollowing payment of such amounts to employees of the applicable Seller
\nAffiliate. For purposes of this Agreement, non-incentive salary bonuses for
\nNon-U.S. Transferred Employees shall include any payments made to such employees
\nin cash (other than for salary) during each calendar year including, but not
\nlimited to the following: Christmas bonus; 13th month payment bonus; vacation
\npremium bonus; savings fund bonus; and profit sharing bonus.<\/p>\n
3.3. Severance. Without limiting anything in Section 3.2 herein
\nand consistent therewith, if any Non-U.S. Transferred Employee is terminated by
\nany Buyer Affiliate (other than for Cause or under applicable law) prior to
\nDecember 31, 2002, Buyer shall cause the applicable Affiliate to provide such
\nemployee with a severance payment consistent with legal requirements, relevant
\npolicies and practices and industry standards; provided that, as permitted by
\nlocal law, Buyer may require a release of claims for any and all benefits
\nprovided under this Section 3.3. Buyer shall cause its Affiliates to recognize
\nservice with Seller or any of its Affiliates based on Seller’s service club
\ndates for purposes of calculating such severance payment.<\/p>\n
3.4. Vacation. Buyer shall cause its Affiliates to assume and on
\na timely basis perform, satisfy and discharge all obligations and liabilities
\nrelated to the Non-U.S. Transferred Employees under their applicable vacation
\npolicies or programs. Buyer shall cause its Affiliates to continue to apply the
\nvacation policy of the applicable Seller Affiliate that is in effect immediately
\nprior to the Closing Date. Thereafter, each Non-U.S. Transferred Employee shall
\nenjoy the same vacation entitlements as he or <\/p>\n
she enjoyed under the vacation policy of the applicable Seller Affiliate
\napplicable immediately prior to the Closing Date. Buyer shall cause its
\nAffiliates to recognize service with the applicable Seller Affiliate for
\npurposes of determining an individual’s entitlement to vacation. Seller and its
\nAffiliates shall not, as the result of entering into this Agreement, be required
\nto pay out accrued vacation to any Non-U.S. Transferred Employee, except as
\nrequired by applicable law, nor be required to reimburse Buyer for any such
\npayment.<\/p>\n
3.5. Sponsorship of Non-U.S. Employee Benefit Plans.<\/p>\n
(a) Buyer shall cause its Affiliates to establish or maintain
\nBuyer Non-U.S. Plans in accordance with the terms of this Agreement and
\napplicable law, in order to provide employee benefits for Non-U.S. Transferred
\nEmployees as required by Section 3.2.<\/p>\n
(b) Immediately prior to the Closing Date, Seller and\/or its
\nAffiliates shall cease all responsibility or liability with respect to coverage
\nfor any Non-U.S. Transferred Employee under any pension, retirement, medical,
\ndental, disability, severance, life insurance, accident insurance or other
\nretirement or health or welfare benefit plan, program or policy which is
\nmaintained by Motorola or any of its Affiliates. To the extent such coverages
\nare permitted to cease under applicable law, they shall do so immediately prior
\nto the Closing Date. To the extent such coverages continue under applicable law,
\nBuyer shall indemnify Seller and its Affiliates and reimburse them for any and
\nall expenses incurred under said plans in respect of the period of employment on
\nor after the Closing Date in accordance with the reimbursement provisions of the
\nTransition Services Agreement.<\/p>\n
3.6. Service Credit. Buyer shall cause its Affiliates to provide
\neach Non-U.S. Transferred Employee with full credit under the Buyer Non-U.S.
\nPlans, for pre-Closing (i) service with Seller and its Affiliates and (ii)
\nservice other than with Seller and its Affiliates, to the same extent as such
\nemployee was entitled, before the Closing Date, to credit for such service under
\nany similar Seller Non-U.S. Plan, provided that such credit does not result in
\nany duplication of benefits or any pension benefit accruals for service prior to
\nClosing.<\/p>\n
3.7. Buyer Guaranty. Buyer shall take all action necessary to
\ncause the applicable Buyer Affiliates to fulfill the terms of this Agreement.<\/p>\n
3.8. Responsibility for Employees.<\/p>\n
(a) Except as otherwise provided for in this Agreement, for
\nNon-U.S. Transferred Employees, Buyer shall cause its Affiliates to assume and
\nthereafter pay, perform and discharge any and all employment, compensation and
\nemployee benefit liabilities, responsibilities and obligations of the applicable
\nSeller Affiliate including, without limitation, any and all claims under
\napplicable law, including breach of any contract of service or claim for
\ncompensation or redress for wrongful or unfair dismissal <\/p>\n
or discrimination or failure to comply with an order for reinstatement or
\nre-engagement or failure to comply with any provisions of all or any existing
\nlaws, which liabilities, responsibilities and obligations which relate to the
\nperiod of employment (or its termination) after the Closing. In the event that
\nSeller or an Affiliate of Seller or any Employee Benefit Plan maintained by
\nSeller or any of its Affiliates directly or indirectly incurs any costs,
\nliabilities, obligations or legal expenses in respect to the period of
\nemployment (or its termination) after the Closing, Buyer shall reimburse and
\nindemnify Seller and its Affiliates for any and all such costs, liabilities,
\nobligations and expenses immediately upon the demand of Seller.<\/p>\n
(b) Except as otherwise provided for in this Agreement, Seller
\nshall remain liable for and shall (or shall cause its appropriate Affiliate to)
\npay, perform and discharge any and all employment, compensation and employee
\nbenefit liabilities, responsibilities and obligations of Seller (or such
\nAffiliate) including, without limitation, any and all claims under applicable
\nlaw, including breach of any contract of service or claim for compensation or
\nredress for wrongful or unfair dismissal or discrimination or failure to comply
\nwith an order for reinstatement or re-engagement or failure to comply with any
\nprovisions of all or any existing laws which liabilities, responsibilities and
\nobligations which relate to the period of employment (or its termination) prior
\nto the Closing, regardless of whether claims are made or reported as of the
\nClosing. In the event that Buyer or an Affiliate of Buyer or any Employee
\nBenefit Plan maintained by Buyer or any of its Affiliates directly or indirectly
\nincurs any costs, liabilities, obligations or legal expenses related to the
\nperiod of employment (or its termination) prior to the Closing, Seller shall
\nreimburse and indemnify Buyer and its Affiliates for any and all such costs,
\nliabilities, obligations and expenses immediately upon the demand of Buyer.<\/p>\n
3.9. Fulfillment by Buyer of International Obligations. Buyer
\nagrees that it will take all steps necessary to employ Non-U.S. Transferred
\nEmployees as of the day after the Closing Date in compliance with applicable
\nlaw, including, where necessary; establishing appropriate branch offices or
\nsubsidiaries; registering with appropriate government entities; preparing and
\nproviding to employees employment contracts and\/or offer letters; obtaining
\nnecessary licenses and consents; and entering into insurance contracts for the
\nprovision of employment benefits or establishing plans to provide such benefits
\n(collectively, such activities shall be referred to as the “Transition
\nActivities”). Seller agrees that it will use its reasonable best efforts to
\nassist Buyer with the Transition Activities and cooperate with any reasonable
\nrequest for information and access to facilities and employees. Buyer agrees
\nthat it will use its best efforts to complete such Transition Activities as soon
\nas practicable after the date of this Agreement. Buyer further agrees to provide
\nSeller in a timely manner, whether before or after the Closing Date, with such
\ninformation and, when appropriate, documentation, as Seller may reasonably
\nrequest about the Transition Activities, so that Seller may fulfill its own
\nlegal obligations to employees, comply with its obligations under this
\nAgreement, and confirm Buyer’s compliance with, or readiness to fulfill, Buyer’s
\nobligations under this Section 3.9. Buyer will be responsible for and will
\nindemnify <\/p>\n
Seller or its Affiliates from and against any wage, salary, benefit costs,
\nadministration costs, severance, termination compensation, or other damages
\nattributable to Buyer’s failure to fulfill its obligations under this Section
\n3.9 and relevant laws pertaining to the transfer of undertaking, unless that
\nfailure is attributable to Seller’s actions or unreasonable delay by Seller in
\nperforming its obligations under this Agreement. The remedies specified in the
\npreceding sentence shall be in addition to, and not in lieu of, any other rights
\nor remedies to which Seller may be entitled by law or this Agreement.<\/p>\n
3.10. Argentina Employee. Notwithstanding anything to the
\ncontrary contained herein, the Parties agree that the Seller Affiliate employee
\nin Argentina shall be leased to the Buyer or a Buyer Affiliate for a period not
\nto exceed one year following the Closing Date, upon terms mutually agreed to the
\nby the Parties under the Transition Services Agreement. The Parties agree that
\nsuch lease is a convenience to facilitate the transition process and that the
\nParties shall act as soon as practicable to end such lease and transfer
\nemployment to Buyer. Buyer is responsible for all costs related to such lease,
\nincluding any costs related to its termination. Costs will be determined
\naccording to the Transition Services Agreement.<\/p>\n
IV EXECUTIVE MATTERS<\/p>\n
4.1. Retention Payments. Seller shall be responsible for the
\ncosts, obligations and liabilities with respect to retention agreements entered
\ninto with any U.S. Hired Employees prior to the Closing Date. At the request of
\nSeller, Buyer shall make (and otherwise administer) the cash retention payments
\nunder the foregoing retention agreements to the extent that Seller has wire
\ntransferred to a Buyer account funds sufficient to make such retention payments
\n(including without limitation any applicable payroll taxes).<\/p>\n
4.2. Automobiles. To the extent that Seller automobiles used by Group
\nemployees are transferred to Buyer, Buyer, with respect to U.S. Hired Employees
\nwho participated in the Motorola Executive Vehicle Program as of the date of the
\nClosing, will either (i) continue to provide for the use of such automobiles
\nthrough the period ending on December 31, 2002, on the same terms and conditions
\nas in effect before the Closing (except that no automobiles will be replaced
\nduring such period and participation in the program by the participant related
\nto such automobile will cease), or (ii) Buyer will gift such automobiles to
\ntheir respective users who are U.S. Hired Employees.<\/p>\n
V SELLER’S U.S. REPRESENTATIONS AND WARRANTIES<\/p>\n
5.1. Labor Matters. Schedule 2.1 lists all U.S. Hired Employees.
\nWith respect to each U.S. Hired Employee, Schedule 2.1 also reflects base pay,
\nthe most recent bonus amount, date of hire, date of rehire, service club date,
\nvacation service date, and vesting service date immediately prior to the Closing
\nDate. Except as set forth in Schedule 5.1, Seller hereby represents and warrants
\nthat:<\/p>\n
(a) there are no charges, complaints or controversies pending
\nor, to Seller’s Knowledge, threatened, between the Group and any of its
\nrespective current or former employees, which charges, complaints or
\ncontroversies have had, or would have, a Material Adverse Effect on the Group;<\/p>\n
(b) the Group is not a party to any collective bargaining
\nagreement or other labor union contract applicable to U.S. Hired Employees and
\nthe Seller has not entered into any material agreement or material negotiation
\nwith any labor union or other collective bargaining representative of any
\nemployee of Seller or its affiliates assigned to the Group, nor, to Seller’s
\nKnowledge, are there any activities or proceedings of any labor union to
\norganize any such employees;<\/p>\n
(c) to Seller’s Knowledge, there are no labor disputes, strikes,
\nslowdowns, work stoppages, lockouts, or threats thereof, by or with respect to
\nany of the Group’s employees;<\/p>\n
(d) there are no written employment agreements (or contracts
\nwith independent contractors that have not been disclosed) which cannot be
\nterminated by Seller at the Closing Date;<\/p>\n
(e) neither Seller nor any of its Affiliates is a party or
\notherwise subject to any conciliation agreement or similar agreement or
\ncommitment with the Office of Federal Contract Compliance Programs;<\/p>\n
(f) to Seller’s Knowledge, Seller has complied in all material
\nrespects with all applicable laws pertaining to the employment or termination of
\nemployment of employees, and the retention, categorization or termination of
\nother service providers, relating to the Group, including, without limitation,
\nall such laws relating to labor relations, equal employment opportunities, fair
\nemployment practices, prohibited discrimination or distinction or other similar
\nemployment activities, except for any failures to comply that, individually or
\nin the aggregate, would not have or result in a Material Adverse Effect on the
\nGroup; and<\/p>\n
(g) Seller has not made or promised to make any increases in any
\nsalaries, rates of pay or other compensation or benefits of any employee of the
\nGroup or its affiliates assigned to the Group, except for customary periodic
\nincreases made in the ordinary course of business such as described in Section
\n2.2(a) of this Agreement.<\/p>\n
5.2. Representations and Warranties for Seller U.S. Plans.<\/p>\n
(a) Schedule 1.13 lists all Seller U.S. Plans on the Closing
\n Date. The representations and warranties in this Section 5.2 relate
\n solely to Seller U.S. Plans.<\/p>\n
(b) Where applicable, with respect to each of the Seller U.S.
\n Plans, true and complete copies of (i) all plan documents (including all
\n amendments and <\/p>\n
modifications thereof) or, if none, a summary thereof, and all related
\n trust agreements, insurance contracts and other funding arrangements;
\n (ii) (only with respect to any Seller U.S. Plan from which a Buyer U.S.
\n Plan shall receive a transfer of assets and liabilities under this
\n Agreement, including without limitation those plans involved in the
\n Pension Transfer Agreement and the 401(h) Transfer Agreement) the most
\n recently filed Annual Return\/Report (United States Department of Labor
\n Form 5500 series) and all schedules thereto, as applicable; (iii) the
\n current summary plan descriptions and all summaries of material
\n modifications thereto as applicable; and (iv) the most recent Internal
\n Revenue Service determination letter issued with respect to each Seller
\n U.S. Plan, have been delivered or made available to Buyer as of the
\n Closing Date.<\/p>\n
(c) Except as disclosed on Schedule 5.2, each Seller U.S. Plan
\n has been maintained, operated and administered in material compliance
\n with its terms and the applicable provisions of ERISA, the Code, or
\n other applicable law.<\/p>\n
(d) Except as disclosed on Schedule 5.2, each Seller U.S. Plan
\n which is intended to meet the qualification requirements of Section
\n 401(a) of the Code has received a favorable determination letter from
\n the IRS and would, subject to adoption (within any applicable required
\n time period) of amendments required by the IRS in the ordinary course
\n pursuant to an application for a determination letter, receive an
\n updated favorable determination letter from the IRS, and no amendment
\n has been made or no event has occurred with respect to any such Seller
\n U.S. Plans which would reasonably be expected to cause the loss or
\n denial of such qualification under Code Section 401(a).<\/p>\n
(e) Except as disclosed on Schedule 5.2, there are no pending,
\n or to the Knowledge of Seller, threatened audits or investigations by
\n any governmental agency involving any Seller U.S. Plan from which a
\n Buyer U.S. Plan shall receive a transfer of assets and liabilities under
\n this Agreement (including those plans involved in the Pension Transfer
\n Agreement and the 401(h) Transfer Agreement), and to the Knowledge of
\n Seller, there are no threatened or pending claims (except for routine
\n claims for benefits payable in the ordinary operation of the Seller U.S.
\n Plan), suits, or proceedings involving any such Seller U.S. Plan, that
\n would have a Material Adverse Effect on the Group.<\/p>\n
(f) Except as disclosed on Schedule 5.2, with respect to any
\n Seller U.S. Plan that is a “group health plan” within the meaning of
\n Section 607 of ERISA and that is subject to Section 4980B of the Code,
\n Seller has and will comply in all material respects with the
\n continuation coverage requirements of the Code and ERISA with respect to
\n U.S. Hired Employees (and their eligible dependents).<\/p>\n
(g) No Seller U.S. Plan for the benefit of U.S. Hired Employees
\n is a “multiemployer pension plan” as defined in Section 3(37) of ERISA.<\/p>\n
(h) Schedule 5.2 includes a workers’ compensation paid loss
\nsummary through the Closing Date on an accident year basis. Schedule 5.2
\nadditionally includes a recent listing of all open workers compensation claims
\nshowing claimant name, claim number, description, paid loss and case reserve.<\/p>\n
(i) The Seller has never been nor is a party to or otherwise
\nbound by any advance agreement or similar arrangement with any Governmental
\nAuthority or regulatory body relating to the allowability, allocation or
\nreimbursement of benefit costs or other matters in connection with any Seller
\nU.S. Plan.<\/p>\n
(j) Except as disclosed on Schedule 5.2, no Seller U.S. Plan
\ncontains any provision that would prohibit the transactions contemplated by this
\nAgreement or that would give rise to any severance, termination or other
\npayments solely (or in connection with some other reasonable foreseeable related
\nevent) as a result of the transactions contemplated by this Agreement.<\/p>\n
(k) The funding method used in connection with each Seller U.S.
\nPlan that is an Employee Pension Benefit Plan (as defined in ERISA) which is
\nsubject to the minimum funding requirements of ERISA is acceptable under law,
\nand the actuarial assumptions used in connection with funding each such plan are
\nreasonable. The valuation summaries provided by Seller to Buyer reasonably
\nrepresent the assets and liabilities attributable to the Seller U.S. Plans
\ncalculated in accordance with the past practices of the Seller.<\/p>\n
(l) Any Seller U.S. Plan (or liability related thereto) assumed
\nby Buyer is by its terms able to be amended or terminated.<\/p>\n
(m) With respect to each Seller U.S. Plan, and to the extent
\nthat any of the circumstances or events described in (i) through (ii) below
\nwould have a Material Adverse Effect:<\/p>\n
(i) no such Seller U.S. Plan that is an Employee Pension Benefit
\n Plan (other than any multiemployer plan) has any liability under Title
\n IV of ERISA, other than routine PBGC premiums;<\/p>\n
(ii) there have been no Prohibited Transactions with respect to
\n such Seller U.S. Plans; no fiduciary, to the Knowledge of Seller, has
\n any liability for breach of fiduciary duty or any other failure to act
\n or comply in connection with the administration or investment of the
\n assets of such Seller U.S. Plans, and no action, suit, proceeding,
\n hearing or investigation with respect to the administration or the
\n investment of the assets of such Seller U.S. Plans (other than routine
\n claims for benefits) is pending or (to the Knowledge of Seller)
\n threatened; and<\/p>\n
(iii) other than routine claims for benefits, none of the Seller
\n or any of its Affiliates or Subsidiaries has incurred, and the Seller
\n has no reason to expect <\/p>\n
that the Seller or any of its Affiliates or Subsidiaries will incur as a
\n result of circumstances or events prior to the Closing Date, any
\n liability to the PBGC (other than PBGC premium payments which have been
\n made when due) or otherwise under Title IV of ERISA (including any
\n withdrawal liability) or under the Code with respect to any Seller U.S.
\n Plan that is an Employee Pension Benefit Plan.<\/p>\n
(n) Except as disclosed on Schedule 5.2, to the Knowledge of
\nSeller, the Seller has not communicated to any employee (excluding internal
\nmemoranda to management) any plan or commitment, whether or not legally binding,
\nto create any additional material plan or materially modify or change any Seller
\nU.S. Plan that would affect any employee or terminated employee of the Seller or
\nany of the Affiliates or Subsidiaries in a material manner.<\/p>\n
(o) To the Knowledge of Seller, no individual classified as a
\nnon-employee for purposes of receiving employee benefits (such as an independent
\ncontractor, leased employee, consultant or special consultant), regardless of
\ntreatment for other purposes, is eligible to participate in or receive benefits
\nunder any Seller U.S. Plan which does not specifically provide for their
\nparticipation, in any respects which in the aggregate would have a Material
\nAdverse Effect.<\/p>\n
(p) All liabilities related to Seller’s vacation policy and
\nSeller’s Attendance Bonus Plan and assumed by Buyer under Section 2.4 have been
\nproperly accrued on the Balance Sheet or incurred since the Balance Sheet Date
\nby Seller in the ordinary course of business.<\/p>\n
(q) The GDC Retiree Plan (as defined in the 401(h) Transfer
\n Agreement) contains employer contribution cost limits of 2 times 1992
\n employer cost levels, which such cost levels are set forth in Schedule
\n 5.2(q) (to be provided as soon as practicable following execution of
\n this Agreement).<\/p>\n
VI BUYER U.S. REPRESENTATIONS AND WARRANTIES<\/p>\n
6.1. Labor Matters. Buyer represents and warrants that it is not
\na party to any collective bargaining agreement, side letter, or other
\narrangement with any local, national, or international union that would (i)
\nrequire it to recognize any union as the collective bargaining representative of
\nU.S. Hired Employees without an election having been conducted by the National
\nLabor Relations Board (“NLRB”); (ii) require any U.S. Hired Employees to be
\nincluded in or made a part of any existing collective bargaining unit,
\narrangement, or agreement; or (iii) require Buyer to maintain neutrality during
\nany attempt to organize or represent U.S. Hired Employees.<\/p>\n
6.2. Representations and Warranties for Buyer U.S. Plans.<\/p>\n
(a) With respect to the Buyer 401(k) Plan, true and complete
\n copies of (i) all plan documents (including all amendments and
\n modifications thereof); (ii) the <\/p>\n
current summary plan descriptions and all summaries of material
\n modifications thereto; and (iv) the most recent Internal Revenue Service
\n determination letter issued with respect to that plan, have been
\n delivered or made available to Seller as of the Closing Date.<\/p>\n
(b) Except as disclosed in Schedule 6.2, the Buyer 401(k) Plan
\n has received a favorable determination letter from the IRS or such
\n letter has been timely applied for, and such plan has not been amended
\n since the date of its most recent determination letter (or said
\n application thereof) in any respect which would materially jeopardize
\n the continuing validity of that determination letter.<\/p>\n
VII SELLER’S NON-U.S. REPRESENTATIONS AND WARRANTIES<\/p>\n
7.1. Labor Matters. Schedule 1.9 lists all Non-U.S. Transferred
\nEmployees. With respect to each Non-U.S. Transferred Employee, Schedule 1.9 also
\nreflects base pay, date of hire, date of rehire, service club date, vacation
\nservice date, and vesting service date immediately prior to the Closing Date (to
\nthe extent such dates are applicable). Except as set forth in Schedule 7.1,
\nSeller hereby represents and warrants that:<\/p>\n
(a) there are no legal or administrative claims pending or, to
\n Seller’s Knowledge, threatened, between the Group and any of its
\n respective current or former Non-U.S. Transferred Employees, which
\n claims have had, or would have, a Material Adverse Effect on the Group;<\/p>\n
(b) except to the extent all employers or all employers in an
\n industry may be required under applicable law to consult, inform, meet
\n with, or gain the approval of a trade union committee, worker council,
\n or similar organization, or such committee, council, or organization may
\n have the right under applicable law to set or establish certain terms
\n and conditions of employment for all employers or all employers in an
\n industry, the Group is not a party to any collective bargaining
\n agreement or other labor union contract applicable to Non-U.S.
\n Transferred Employees and the Seller has not entered into any material
\n agreement or material negotiation with any labor union or other
\n collective bargaining representative of any employee of Seller or its
\n affiliates assigned to the Group, nor, to Seller’s Knowledge, are there
\n any activities or proceedings of any labor union to organize any such
\n employees;<\/p>\n
(c) to Seller’s Knowledge, there are no labor disputes, strikes,
\n slowdowns, work stoppages, lockouts, or threats thereof, by or with
\n respect to any of the Group’ Non-U.S. Transferred Employees;<\/p>\n
(d) other than agreements applicable to multiple employees at a
\n single location or in a particular country (which Buyer has been
\n provided or been given an opportunity to review), Seller has no written
\n employment agreements with any Non-U.S. Transferred Employees;<\/p>\n
(e) to Seller’s Knowledge, Seller has complied in all material
\n respects with all applicable laws pertaining to the employment or
\n termination of employment of Non-U.S. Transferred Employees, and the
\n retention, categorization or termination of other non-U.S. service
\n providers relating to the Group, including, without limitation, all such
\n laws relating to labor relations, equal employment opportunities, fair
\n employment practices, prohibited discrimination or distinction or other
\n similar employment activities, except for any failures to comply that,
\n individually or in the aggregate, would not have or result in a Material
\n Adverse Effect on the Group; and<\/p>\n
(f) Seller has not made or promised to make any increases in any
\n salaries, rates of pay or other compensation or benefits of any employee
\n of the Group or its affiliates assigned to the Group, except for
\n customary periodic increases made in the ordinary course of business
\n (including the merit increase planned for October 2001).<\/p>\n
7.2. Representations and Warranties for Seller Non-U.S. Plans.<\/p>\n
(a) Schedule 1.10 lists all Seller Non-U.S. Plans. The
\n representations and warranties in this Section 7.2 relate solely to the
\n Seller Non-U.S. Plans.<\/p>\n
(b) Where applicable, with respect to each of the Seller
\n Non-U.S. Plans, true and complete copies of (i) all plan documents
\n (including all amendments and modifications thereof) or, if none, a
\n summary thereof, and all related trust agreements, insurance contracts
\n and other funding arrangements; and (ii) the current summary plan
\n description distributed to participants therein, have been delivered or
\n made available to Buyer as of the Closing Date.<\/p>\n
(c) Except as disclosed on Schedule 7.2 each Seller Non-U.S.
\n Plan has been maintained, operated and administered in compliance with
\n its terms and the provisions of applicable law, except for noncompliance
\n which would not result in a Material Adverse Effect.<\/p>\n
(d) Except as disclosed on Schedule 7.2, each Seller Non-U.S.
\n Plan which must be registered or qualified with a Non-U.S. Governmental
\n Authority in the country in which it is maintained has received or
\n timely applied for such registration or qualification, and such Plan has
\n not been amended since the date of its most recent registration or
\n qualification (or application therefor) in any respect which would
\n result in a Material Adverse Effect.<\/p>\n
(e) Except as disclosed on Schedule 7.2, there are no pending,
\n or to Seller’s Knowledge, threatened audits or investigations by any
\n governmental agency involving any Seller Non-U.S. Plan from which Buyer
\n or its Affiliates or any Buyer Non-U.S. Plan shall receive a transfer of
\n assets and liabilities under Article III, and to Seller’s Knowledge,
\n there are no threatened or pending claims (except for routine claims for
\n benefits payable in the ordinary operation of the <\/p>\n
Seller Non-U.S. Plan), suits, or proceedings involving any such Seller
\n Non-U.S. Plan that would have a Material Adverse Effect.<\/p>\n
(f) Except as disclosed on Schedule 7.2, with respect to any
\n Seller Non-U.S. Plan from which Buyer or its Affiliates or any Buyer
\n Non-U.S. Plan shall receive a transfer of assets and liabilities
\n pursuant to Article III, all contributions, premiums, expenses and other
\n payments required to be made by Seller or its Affiliates by the Closing
\n Date have been made.<\/p>\n
(g) All liabilities related to Seller’s vacation policy and
\n assumed by Buyer under Section 3.4 have been properly accrued on the
\n Balance Sheet or incurred since the Balance Sheet Date by Seller in the
\n ordinary course of business.<\/p>\n
VIII BUYER NON-U.S. REPRESENTATIONS AND WARRANTIES<\/p>\n
8.1. Representations and Warranties for Buyer Non-U.S. Plans.<\/p>\n
(a) Schedule 1.1, to be provided as soon as practicable
\n following execution of this Agreement, lists all Buyer Non-U.S. Plans in
\n effect as of the Closing Date.<\/p>\n
(b) With respect to each Buyer Non-U.S. Plan to which a Seller
\n Non-U.S. Plan shall make a transfer of assets and liabilities under this
\n Agreement, true and complete copies of (i) all plan documents (including
\n all amendments and modifications thereof) and all related trust
\n agreements, insurance contracts and other funding arrangements; and (ii)
\n the most recent written evidence (if any) of any required registration
\n or qualification with a local Governmental Authority issued with respect
\n to each Buyer Non-U.S. Plan, have been delivered or made available to
\n Seller as of the Closing Date or, in the case of a Buyer Non-U.S. Plan
\n not yet adopted or in effect at the Closing Date, as soon as practicable
\n after it becomes available.<\/p>\n
(c) With respect to each Buyer Non-U.S. Plan not described in
\n (b) above, true and complete copies of (i) the current summary plan
\n description distributed to participants therein (which accurately and
\n completely describes the substantive provisions of the related Buyer
\n Non-U.S. Plan in all material respects) has been delivered or made
\n available to Seller as of the Closing Date or, in the case of a Buyer
\n Non-U.S. Plan not yet adopted or in effect at the Closing Date, as soon
\n as practicable after it becomes available.<\/p>\n
(d) Except as disclosed on Schedule 8.1, each Buyer Non-U.S.
\n Plan adopted and in effect at the Closing Date has been maintained,
\n operated and administered in material compliance with its terms and
\n applicable law.<\/p>\n
IX MISCELLANEOUS<\/p>\n
9.1. Entire Agreement. This Agreement is an integral part of, is
\nsubject to, and is to be interpreted consistently with, the Purchase Agreement;
\nin all other respects this Agreement constitutes the entire agreement between
\nthe parties with respect to the subject matter hereof and supersedes all prior
\nwritten and oral and all contemporaneous oral agreements and understandings with
\nrespect to the subject matter hereof.<\/p>\n
9.2. Governing Law. This Agreement shall be governed by and
\nconstrued in accordance with the laws of the State of Illinois (except to the
\nextent superseded by ERISA), but regardless of any other laws that might
\notherwise govern under principles of conflicts of laws applicable thereto.<\/p>\n
9.3. Cooperation. Seller and Buyer agree to, and to cause their
\nAffiliates to, cooperate and use reasonable efforts to promptly (i) comply with
\nall requirements of this Agreement, ERISA, the Code and other law and
\nregulations which may be applicable to the matters addressed herein, and (ii)
\nprovide each other with such information reasonably requested by the other party
\nto assist the other party in administering its Employee Benefit Plans and
\ncomplying with applicable law and regulations and the terms of this Agreement.<\/p>\n
9.4. No Assumption of Seller Employee Benefit Plans. The Parties
\nagree that, except as may be otherwise expressly provided herein, Buyer does not
\nand shall not assume the sponsorship of, or the responsibility for contributions
\nto, or any liability in connection with any Employee Benefit Plan directly
\nmaintained by Seller, its successors and its Affiliates. In addition, with
\nrespect to U.S. Hired Employees, the parties agree that Seller shall offer and
\nbe liable for any continuation health coverage (including any penalties, excise
\ntaxes or interest resulting from the failure to provide continuation coverage)
\nrequired by Section 4980B of the Code due to qualifying events which occur on or
\nbefore the Closing Date.<\/p>\n
9.5. No Third Party Beneficiaries. This Agreement shall not
\nconfer third-party beneficiary rights upon any Hired Employee or any other
\nperson or entity. Nothing in this Agreement shall be construed as giving to any
\nHired Employee or other person any legal or equitable right against Seller,
\nBuyer, or any of their respective Affiliates or Employee Benefit Plans. This
\nAgreement shall not constitute a contract of employment and will not give any
\nHired Employee a right to be retained in the employ of either Seller or Buyer or
\nany of their Affiliates. Notwithstanding anything to the contrary, all
\nemployment made pursuant to this Agreement shall be employment at will.<\/p>\n
9.6. Benefit Plan Expenses. Each Party shall bear all of its own
\ncosts and expenses, including but not limited to legal and actuarial fees
\nincurred in the design, drafting and implementation of its plans and
\ncompensation structures and the amendment of its existing plans or compensation
\nstructures.<\/p>\n
9.7. Plan Participation Records. The Parties agree that upon the
\nrequest of Buyer after the Closing Date, Seller or its Affiliates, as
\napplicable, shall deliver to Buyer or its Affiliates, as applicable, copies of
\nall records for the Hired Employees necessary for the administration of the
\nbenefit programs to be provided to the Hired Employees as contemplated in this
\nAgreement, including, but not limited to, all hire and termination records,
\ncompensation data, pension data, Employee Benefit Plan participation records,
\nand other information as Buyer may reasonably request related to the
\nadministration of any Employee Benefit Plan, including any paper, electronic,
\nmagnetic or imaged data or records. The Parties agree to share equally in any
\nand all costs associated with effecting the purposes and deliveries described in
\nthe previous sentence. Buyer agrees to defend and indemnify Seller for any
\nliabilities arising from the transfer of such employment records and related
\ninformation provided pursuant to the foregoing provisions of this Section.<\/p>\n
9.8. Employment Records. The Parties agree that upon the request
\nof Buyer after the Closing Date, Seller or its Affiliates, as applicable, shall
\ndeliver to Buyer or its Affiliates, as applicable, copies of all employment
\nrecords for the U.S. Hired Employees and the Non-U.S. Transferred Employees
\nrequired to be kept under applicable law or necessary for the conduct of the
\nGroup, including any paper, electronic, magnetic or imaged data or records. The
\nParties agree to share equally in any and all costs associated with effecting
\nthe purposes and deliveries described in the previous sentence. Buyer agrees to
\ndefend and indemnify Seller for any liabilities arising from the transfer of
\nsuch employment records and related information provided pursuant to the
\nforegoing provisions of this Section.<\/p>\n
9.9. Independent Contractors. To the extent requested by Buyer
\nin its sole discretion, on the Closing Date, Seller shall use its reasonable
\nefforts to cause all contracts or agreements with the employees and any
\nindependent contractors to be assigned to Buyer or its Affiliates, as
\napplicable.<\/p>\n
9.10. Restrictions on Movement. Unless the Parties otherwise
\nmutually agree in writing, for the three-year period beginning on the Closing
\nDate, neither Party will, nor will permit its Affiliates to, specifically
\nsolicit or entice away any employee of the other Party or any of its Affiliates.
\nThe Parties agree that neither Party shall be deemed to have violated the
\nforegoing covenant as a result of the placement of any job advertisement or
\nother general solicitation of employment not specifically directed to any
\nemployee of the other Party. Notwithstanding anything to the contrary, for the 5
\nyear period following the Closing Date, neither Seller nor any Seller Affiliate
\nmay hire (or engage as an independent contractor or leased employee) any
\nindividual who is listed on Schedule 9.10 hereto; further, for the period
\nbeginning with the date this Agreement is executed and through the Closing Date,
\nneither Seller nor any Seller Affiliate may cause or permit the solicitation or
\nhiring (or engagement as an independent contractor or leased employee) of any
\nindividual listed on Schedule 9.10 by or on behalf of any other division, unit
\nor Affiliate of Seller, without the express written consent of Buyer. Buyer
\nshall determine in its sole discretion the names to be <\/p>\n
listed on Schedule 9.10, and shall provide such schedule to Buyer within 30 days
\nof the execution of this Agreement.<\/p>\n
9.11. Notices. All notices and other communications hereunder
\nshall be in writing, and shall be deemed to have been duly given if delivered by
\novernight courier, sent by mail to the respective parties or personally
\ndelivered addressed as follows:<\/p>\n
If to Seller: Motorola, Inc.
\n 1301 E. Algonquin Road
\n Schaumburg, IL 60196
\n Facsimile No.: (847) 538-2491
\n Attn: Bob McCall<\/p>\n
With a copy to: Motorola, Inc.
\n Law Department
\n 1303 E. Algonquin Road
\n Schaumburg, IL 60196
\n Facsimile No.: (847) 576-3628
\n Attn: General Counsel<\/p>\n
With a copy (which shall McDermott, Will & Emery
\nnot constitute notice) to 227 West Monroe Street
\n Chicago, Illinois 60606
\n Facsimile No.: (312) 984-7700
\n Attn: Stephen R. Miller<\/p>\n
If to Buyer: General Dynamics Corporation
\n 3190 Fairview Park Drive
\n Falls Church, Virginia 22042-4523
\n Facsimile No.: (703) 876-3125
\n Attn: David A. Savner<\/p>\n
With a copy (which shall Jenner & Block
\nnot constitute notice) to: 1 IBM Plaza
\n Chicago, Illinois 60611
\n Facsimile No.: (312) 527-0484
\n Attn: Thomas A. Monson<\/p>\n
or to such other address as Buyer or Seller may designate by written notice to
\nthe other parties hereto. Any such notices, requests, demands or other
\ncommunications shall be deemed to have been duly given when received if
\ndelivered personally or, if mailed, on the date five (5) days after the date so
\ndeposited in the mails, postage prepaid, return receipt requested or on the day
\nfollowing the day sent if sent by prepaid overnight delivery service. Notices,
\nrequests and other communications hereunder may be <\/p>\n
delivered by electronic facsimile transmission (fax) if confirmation by sender
\nis made within one (1) business day by prepaid overnight delivery service or
\npersonal delivery. All periods of notice shall be measured from the date of
\ndeemed delivery thereof.<\/p>\n
9.12. Parties in Interest. This Agreement shall be binding upon
\nand inure solely to the benefit of each party hereto and their legal
\nrepresentatives and successors and each Affiliate of the parties hereto, and
\nnothing in this Agreement, express or implied, is intended to confer upon any
\nother person any rights or remedies of any nature whatsoever under or by reason
\nof this Agreement.<\/p>\n
9.13. Counterparts. This Agreement may be executed in
\ncounterparts, each of which shall be deemed to be an original but all of which
\nshall constitute one and the same agreement.<\/p>\n
9.14. Assignment. Neither Party may assign its rights or
\nobligations under this Agreement without the express written consent of the
\nother Party, except that Buyer may, without the prior written consent of Seller,
\nassign its rights under this Agreement to any of its direct or indirect wholly
\nowned subsidiaries, provided that Buyer shall remain liable for all of its
\nobligations under this Agreement.<\/p>\n
9.15. Dispute Resolution. Any disputes which arise under this
\nEmployee Matters Agreement shall be resolved in accordance with the dispute
\nprocedures set forth in the Purchase Agreement.<\/p>\n
9.16. Severability. If any term or other provision of this
\nAgreement is invalid, illegal or incapable of being enforced by any rule of law
\nor public policy, all other conditions and provisions of this Agreement shall
\nnevertheless remain in full force and effect so long as the economic or legal
\nsubstance of the transactions contemplated hereby is not affected in any manner
\nmaterially adverse to any party. Upon such determination that any term or other
\nprovision is invalid, illegal or incapable of being enforced, the parties hereto
\nshall negotiate in good faith to modify this Agreement so as to effect the
\noriginal intent of the parties as closely as possible in an acceptable manner to
\nthe end that transactions contemplated hereby are fulfilled to the fullest
\nextent possible.<\/p>\n
9.17. Amendment. No changes, amendment or waiver will be made to
\nthis Agreement except by an instrument in writing signed on behalf of each of
\nthe parties to this Agreement.<\/p>\n
9.18. Plan Amendment and Interpretation. Except as required to
\nprovide the benefits as described in Sections 2.2 and 3.2 hereof, Buyer and
\nSeller expressly reserve the right to alter, amend, modify, or terminate any of
\ntheir Employee Benefit Plans, including, but not limited to, any plan or program
\nestablished or required by this Agreement, at any time and for any reason. Buyer
\nand Seller expressly reserve the right to interpret the provisions of any of
\ntheir Employee Benefit Plans, including, but not <\/p>\n
limited to, any plan or program established or required by this Agreement, with
\nrespect to all of their current or former employees.<\/p>\n
9.19. Authority. Each of the parties hereto represents to the
\nother that (a) it has the corporate or other requisite power and authority to
\nexecute, deliver and perform this Agreement, (b) the execution, delivery and
\nperformance of this Agreement by it have been duly authorized by all necessary
\ncorporate or other action, (c) it has duly and validly executed and delivered
\nthis Agreement, and (d) this Agreement is a legal, valid and binding obligation,
\nenforceable against it in accordance with its terms subject to applicable
\nbankruptcy, insolvency, reorganization, moratorium or other similar laws
\naffecting creditors’ rights generally and general equity principles.<\/p>\n
9.20. Interpretation. The headings contained in this Agreement,
\nin any Schedule hereto and in the table or contents to this Agreement are for
\nreference purposes only and shall not affect in any way the meaning or
\ninterpretation of this Agreement. Any capitalized term used in any Schedule but
\nnot otherwise defined therein, shall have the meaning assigned to such term in
\nthis Agreement. When a reference is made in this Agreement to an Article or a
\nSection or a Schedule, such reference shall be to an Article or Section of, or a
\nSchedule to, this Agreement unless otherwise indicated. The Schedules attached
\nhereto or referred to herein are an integral part of this Agreement and are
\nhereby incorporated into this Agreement and made a part hereof as if set forth
\nin full herein. On and after the Closing Date, the Group shall be deemed to be
\nthe Group of Buyer and the Buyer Affiliates, and all references made herein to
\nBuyer as a party which operate as of a time on or after the Closing Date, shall
\nbe deemed to refer to Buyer and the Buyer Affiliates as a single party.<\/p>\n
9.21. Breaches, Indemnification and Termination. Except as
\nprovided in Sections 2.5 and 3.8, the sole and exclusive remedy for any breach
\nof a representation or warranty set forth herein shall be as set forth in
\nArticle VII of the Purchase Agreement. All representations and warranties set
\nforth herein shall terminate in accordance with Section 7.4 of the Purchase
\nAgreement. This Agreement shall terminate automatically and without need for
\nfurther action by either Party in the event that the Purchase Agreement is
\nterminated, except that Sections 2.5 and 3.8 herein shall survive the
\ntermination of this Agreement. The following Sections of the Purchase Agreement
\nare incorporated herein by reference and are made a part of this Agreement: 10.5
\n(Dispute Resolution), 10.6 (Limitation of Liability) and 10.9 (Miscellaneous).<\/p>\n
9.22. Employee Communications. The Parties shall cooperate with
\nrespect to any employee communications regarding any matters provided for
\nherein, provided that Buyer shall retain the sole and absolute discretion to
\napprove of, in advance, any written employee communications relating to any
\nbenefits to be provided by it under this Agreement. The Parties further agree to
\ncoordinate in advance any <\/p>\n
formal meetings or presentations between Group employees and Buyer
\nrepresentatives and any Buyer written employee communications.<\/p>\n
* * *<\/p>\n
IN WITNESS WHEREOF, this Employee Matters Agreement has been executed by
\nthe Parties as of the date set forth above.<\/p>\n
MOTOROLA, INC.<\/p>\n
By: \/s\/Robert J. McCall
\n ———————————
\n Name: Robert J. McCall
\n ——————————-
\n Title: Vice President
\n ——————————<\/p>\n
GENERAL DYNAMICS CORPORATION<\/p>\n
By: \/s\/Kenneth C. Dahlberg
\n ———————————
\n Kenneth C. Dahlberg
\n Its Executive Vice President<\/p>\n
EXHIBIT C<\/p>\n
ENVIRONMENTAL MATTERS AGREEMENT<\/p>\n
THIS ENVIRONMENTAL MATTERS AGREEMENT (this “Agreement”), made as
\nof August 6, 2001, between Motorola, Inc. (“Seller”), a Delaware corporation,
\nand General Dynamics (“Buyer”), a Delaware corporation,<\/p>\n
WITNESSETH:<\/p>\n
WHEREAS, pursuant to an Asset Purchase Agreement dated the date hereof,
\nby and among Buyer and Seller (the “Asset Purchase Agreement”), Buyer is
\npurchasing certain assets and assuming certain liabilities of Seller’s
\nIntegrated Information Systems Group (the “Group”);<\/p>\n
WHEREAS, pursuant to Section 1.4 of the Asset Purchase Agreement, any
\nliability or obligation to be retained by Seller pursuant to this Agreement
\nshall not be assumed by Buyer and shall be retained by Seller (as an “Excluded
\nLiability” under the Asset Purchase Agreement); and<\/p>\n
WHEREAS, the general subject matter of this Agreement are the
\nparties’ respective obligations for Environmental Liabilities related to the
\npurchased assets, including (i) the Owned Premises and the operations conducted
\nthereon; (ii) the Leased Premises and the operations conducted thereon; and
\n(iii) the North Indian Bend Wash Site which is a subset of the Indian Bend Wash
\nSuperfund Site listed by the United States Environmental Protection Agency
\n(“EPA”) on the CERCLA National Priorities List in September 1983.<\/p>\n
NOW THEREFORE, in consideration of the premises and the representations,
\nwarranties, covenants and agreements set forth below, the parties agree with
\nlegal and binding effect as follows:<\/p>\n
ARTICLE I<\/p>\n
DEFINITIONS<\/p>\n
As used in this Agreement, capitalized terms shall have the meanings set
\nforth or referenced in this Article I or elsewhere in this Agreement.
\nCapitalized terms used herein without definition shall have the meanings
\nassigned to such terms in the Asset Purchase Agreement.<\/p>\n
“CERCLA” shall mean the Comprehensive Environmental Response, Compensation and
\nLiability Act (42 U.S.C. Section 9601, et seq.), as amended, and all rules,
\nregulations, standards, guidelines, and publications issued thereunder where
\nthey are promulgated as part of a <\/p>\n
rulemaking.<\/p>\n
“Condition” shall mean any condition which results in or otherwise
\nrelates to any Environmental Liability.<\/p>\n
“Environmental Claim” shall mean a demand, suit, claim, or assertion of
\nliability relating to any Environmental Liabilities that may give rise to a
\nclaim for indemnification under this Agreement.<\/p>\n
“Environmental Law or Laws” shall mean all current Laws which address, are
\nrelated to, or are otherwise concerned with environmental, worker safety, or
\nworker health issues.<\/p>\n
“Environmental Liability or Liabilities” shall mean any obligations or
\nliabilities (including any notices, claims, complaints, suits, or other
\nassertions of obligations or liabilities) that are:<\/p>\n
(a) related to environmental, health or safety issues (including
\n on-site or off-site contamination by Pollutants of surface or
\n subsurface soil, surface or subsurface water, and worker safety
\n and health); or<\/p>\n
(b) based upon (i) any provision of current Environmental Law
\n (including CERCLA and RCRA), or (ii) any judgment, order, writ,
\n decree, permit or injunction imposed by any court,
\n administrative agency, or tribunal under any provision of
\n current Environmental Law.<\/p>\n
The term “Environmental Liabilities” includes (without
\nlimitation): (A) fines, penalties, judgments, awards, settlements, losses,
\ndamages, costs, fees (including attorneys’ and consultants’ fees), expenses, and
\ndisbursements; (B) defense and other responses to any administrative or judicial
\naction (including notices, claims, complaints, suits, and other assertions of
\nliability); or (C) financial responsibility for compliance costs, investigative
\ncosts, cleanup costs, and injunctive relief, including any Remediation and
\nnatural resource damages.<\/p>\n
“Environmental Permit” shall mean any Permit that is authorized pursuant to any
\nEnvironmental Law.<\/p>\n
“Laws” shall mean all current United States federal, state and local laws,
\nstatutes, rules, regulations, ordinances, codes, requirements, rules of common
\nlaw, standards, guidelines, and the like, including any judicial and
\nadministrative interpretations thereof, and all judicial and administrative
\norders, consents, decrees, writs, injunctions, and judgments.<\/p>\n
“Leased Premises” shall have the meaning set forth in the Asset Purchase
\nAgreement.<\/p>\n
“Manage” and “Management” shall mean generation, production, handling,
\ndistribution, processing, use, storage, treatment, operation, transportation,
\nrecycling, reuse and\/or disposal, as those terms are defined in CERCLA, RCRA and
\nother Environmental Laws (including as those <\/p>\n
terms are further defined, construed, or otherwise used in rules, regulations,
\nstandards, guidelines and publications issued pursuant to, or otherwise in
\nimplementation of, such Environmental Laws).<\/p>\n
“NIBW Site” shall mean the Indian Bend Wash Superfund Site listed on the
\nNational Priorities List in September 1983, including the approximately ten
\nsquare mile area described in the EPA Public Comment Draft, North Indian Bend
\nWash RI\/FS, April 1991, and initially bound on the north by Chaparral Road, on
\nthe south by the southern boundaries of Sections 11 and 12 of Township 1 North
\nRange 4 East, on the east by Pima Road, and on the west by Scottsdale Road,
\nincluding but not limited to the aquifers designated as Upper Alluvial Unit
\n(“UAU”), Middle Alluvial Unit (“MAU”), and Lower Alluvial Unit (“LAU”), as shown
\nin the map attached as Schedule 1. The NIBW Site shall include adjacent areas
\nwhere hazardous substances have migrated and any additional areas designated by
\nEPA to be included in the NIBW Site. The Owned Premises are located within the
\nNIBW Site.<\/p>\n
“Owned Premises” shall have the meaning set forth in the Asset Purchase
\nAgreement.<\/p>\n
“Permit” shall mean any permit, license, certification, approval, registration,
\nconsent, or other authorization issued pursuant to any Law.<\/p>\n
“Pollutant” shall mean any “hazardous substance,” “extremely hazardous
\nsubstance,” or “pollutant or contaminant” as those terms are defined in CERCLA;
\nany “hazardous waste” as that term is defined in RCRA; any “hazardous material”
\nas that term is defined in the Hazardous Materials Transportation Act (49 U.S.C.
\nSection 1801 et seq.) as amended; any “chemical substance or mixture” as that
\nterm is defined in the Toxic Substances Control Act (15 U.S.C. . Section 2601,
\net seq.) as amended (including as any of these above terms are further defined,
\nconstrued, or otherwise used in rules, regulations, standards, guidelines and
\npublications issued pursuant to, or otherwise in implementation of, said Laws),
\nand including without limitation any asbestos-containing material, petroleum,
\nradioactive, or explosive product or byproduct.<\/p>\n
“Premises” shall mean the Owned Premises and the Leased Premises.<\/p>\n
“RCRA” shall mean the Resource Conservation and Recovery Act (42 U.S.C. Section
\n6901 et seq.), as amended, and all rules, regulations, standards, guidelines,
\nand publications issued thereunder where they are promulgated as part of a
\nrulemaking.<\/p>\n
“Remediation” shall mean the types of investigative, “removal,” “remedial,” and
\n“response” activities covered by CERCLA, RCRA, and other Environmental Laws or
\nas required by any federal, state, or local government entity.<\/p>\n
ARTICLE II<\/p>\n
GENERAL PRINCIPLES<\/p>\n
2.1 Division of Environmental Liabilities. Subject to Article V
\nbelow, the Agreement seeks to ensure that Seller retains responsibility for
\nEnvironmental Liabilities relating to the NIBW Site and to protect Buyer from
\nEnvironmental Claims relating to the NIBW Site. The Agreement further seeks to
\nensure that, as between the parties, Seller has responsibility for offsite waste
\ndisposal by Seller prior to the Closing Date, and Buyer has responsibility for
\noffsite waste disposal by Buyer after the Closing Date. In addition, the
\nAgreement addresses the parties’ responsibilities for other Environmental
\nLiabilities and provides indemnification for certain Environmental Claims as
\ndetailed in Article V.<\/p>\n
2.2 Limitation on Article II. Nothing in this Article II is intended
\nto enlarge or restrict the terms stated elsewhere in this Agreement.<\/p>\n
ARTICLE III<\/p>\n
ENVIRONMENTAL REPRESENTATIONS AND WARRANTIES OF SELLER<\/p>\n
Seller hereby represents and warrants to Buyer, as of the date hereof
\nand as of the Closing Date, and with respect to the Owned Premises, the Leased
\nPremises, and the NIBW Site, but as to the NIBW Site only as set forth in
\nSections 3.1, 3.5 and 3.6, as follows:<\/p>\n
3.1 Environmental Liabilities. Except as set forth on Schedule 3.1,
\nSeller has not incurred any Environmental Liabilities, except Environmental
\nLiabilities that would not result in a Material Adverse Effect.<\/p>\n
3.2 Permits. Seller has all applicable Environmental Permits.
\nSchedule 3.2 is a list of all Environmental Permits for the Owned Premises and
\nthe Leased Premises.<\/p>\n
3.3 Compliance with Laws. Except as set forth on Schedule 3.3, the
\nOwned Premises and the Leased Premises and Seller’s conduct of business and
\noperations at the Owned Premises and the Leased Premises are in compliance with
\nEnvironmental Laws, except where the failure to so comply would not have a
\nMaterial Adverse Effect.<\/p>\n
3.4 Liens. Except as set forth on Schedule 3.4, there are no Liens
\nbased upon Environmental Laws.<\/p>\n
3.5 Notice. Except as set forth on Schedule 3.5, since January 1,
\n1999, Seller has not received any written notice from any governmental authority
\nof any violation or alleged violation of, non-compliance or alleged
\nnon-compliance with, or liability or alleged liability under, any Environmental
\nLaw, relating to the Owned Premises, the Leased Premises, or the NIBW Site or
\nSeller’s conduct of business, operation, or Remediation at the Owned Premises,
\nthe Leased Premises, or the NIBW Site involving a Condition that may have a
\nMaterial Adverse Effect.<\/p>\n
3.6 Current Obligations at Owned Premises.<\/p>\n
(a) The scope of work and current Remediation obligations
\nthat pertain to the Owned Premises, and that Seller is currently obligated to
\nperform, are summarized in Schedule 3.6(a).<\/p>\n
(b) Seller, and those persons and entities acting at
\nSeller’s direction, who enter the Owned Premises for purposes relating to
\nSeller’s Remediation shall be qualified to perform Seller’s Remediation.<\/p>\n
(c) A summary of environmental conditions and past
\nRemediation work relating to the NIBW Site and conducted at the Owned Premises
\nis included in Schedule 3.6(c).<\/p>\n
3.7 Underground Storage Tanks. To Seller’s Knowledge, there are no
\nunderground storage tanks owned or under the control of Seller located at the
\nOwned Premises or the Leased Premises.<\/p>\n
3.8 Asbestos-Containing Material. All asbestos-containing materials
\nat the Owned Premises are in compliance with Environmental Laws, except where
\nthe failure to so comply would not have a Material Adverse Effect.<\/p>\n
ARTICLE IV<\/p>\n
COVENANTS<\/p>\n
4.1 Obligations of Seller Concerning the NIBW Site. As between the
\nparties, and without in any way affecting the parties’ respective rights and
\nobligations under Article V of this Agreement, Seller, at its sole cost and
\nexpense, will conduct Remediation at the NIBW Site as may be set forth in any
\norders issued by EPA or any consent decrees entered between Seller and EPA. For
\npurposes of this provision, EPA shall include other federal or state agencies
\nwith authority to require Remediation.<\/p>\n
4.2 Access and Cooperation. The parties will take the following
\nmeasures in order to facilitate Seller’s timely and cost-effective performance
\nof its obligations in Section 4.1:<\/p>\n
(a) Seller, and those persons and entities acting at the
\ndirection of Seller, may enter upon and use the Owned Premises, at reasonable
\ntimes and with reasonable notice, including use of all roads and driveways upon
\nthe Owned Premises, for the purpose of complying with Seller’s obligations under
\nthis Agreement, including Seller’s obligations under Section 4.1 of this
\nAgreement, subject to the following:<\/p>\n
(i) Except as provided by 4.2(a)(ii), Seller shall
\nnotify Buyer’s Remediation Project Manager no later than 2 days prior to the
\ndate Seller desires access to the Owned Premises;<\/p>\n
(ii) Seller may enter upon and use the Owned Premises
\nfor the purposes of complying with Seller’s obligations under this Agreement,
\nincluding Seller’s obligations under Section 4.1 of this Agreement, without
\nprior notice if necessary to respond to an upset condition or other emergency
\nrelated to its obligations under this Agreement; provided, however that Seller
\nshall nonetheless comply with subparagraphs (iii)-(v) of this paragraph;<\/p>\n
(iii) Seller is subject to Buyer’s reasonable
\nprotocols for visitors to the Owned Premises, including sign-in procedures and
\nany procedure calling for Buyer’s personnel to accompany Seller, and those
\npersons and entities acting at Seller’s direction, while on the Owned Premises;<\/p>\n
(iv) Seller shall provide proof of insurance, at or
\nprior to the Closing Date, for all employees and contractors entering the Owned
\nPremises for purposes relating to Remediation. Seller shall add Buyer as an
\nadditional insured to any such insurance policy;<\/p>\n
(v) All rights of access to information, documents,
\nand Owned Premises are subject to restrictions on access to classified
\ninformation and facilities imposed by Governmental Authorities; and<\/p>\n
(vi) Sections 4.2(a)(i) through (v) listed above
\nshall also apply to Sections 4.2(b) and 4.2(k).<\/p>\n
(b) Seller may undertake on the Owned Premises such
\nRemediation as Seller deems necessary and prudent for the purpose of complying
\nwith Seller’s obligations under this Agreement, including Seller’s obligations
\nunder Section 4.1 of this Agreement. Buyer reserves the right to request
\ninformation in Seller’s possession or control relating to the performance of
\nSeller’s obligations under Section 4.1 of this Agreement. Seller agrees that it
\nwill provide such information to Buyer, except that: (i) it will not produce
\nprivileged information the disclosure of which could constitute a waiver of any
\nprivilege or doctrine; and (ii) it may redact from any documents pursuant to
\nthis provision any trade secret or business proprietary information of Seller or
\na third party. Except to the extent the information is otherwise publicly
\navailable, Buyer agrees: (i) such information provided hereunder shall continue
\nto be Seller’s property and shall be maintained confidentially by Buyer; and
\n(ii) any information provided hereunder shall not be provided to any third
\nparties, except third parties acting under the direction or control of Buyer,
\nunless expressly agreed to in writing by Seller. The provisions of this Section
\n4.2(b) shall also apply to information provided pursuant to Section 4.2(f).<\/p>\n
(c) Seller will perform all actions under this Agreement,
\nincluding all Remediation at the Owned Premises, in compliance with
\nEnvironmental Laws (including future Environmental Laws if applicable) and in
\nsuch a manner as to minimize, to the extent <\/p>\n
practicable, damage to the Owned Premises (and to the improvements, fixtures and
\nappurtenances thereon), and the disruption of or interference with the use of
\nthe Owned Premises (and the improvements, fixtures and appurtenances thereon) by
\nBuyer.<\/p>\n
(d) Except as limited by Environmental Laws, Seller will
\nobtain and maintain, at its sole cost and expense, all required Environmental
\nPermits to conduct its Remediation obligations under Section 4.1 of this
\nAgreement. Seller will be the named permitted entity on all such permits.
\nSchedule 4.2(d) is a list of all Environmental Permits for Remediation.<\/p>\n
(i) Seller will obtain a new hazardous waste
\nidentification number and will cause all documentation regarding the disposal of
\nwastes generated in connection with Seller’s Remediation obligations under
\nSection 4.1 of this Agreement, including any waste manifests, to reflect Seller
\nas the generator thereof as of the Closing Date.<\/p>\n
(ii) Seller will properly store and maintain any
\nhazardous waste generated pursuant to Seller’s obligations set forth in Section
\n4.1 of this Agreement and will arrange for the proper disposal of such waste
\nwithin 24 hours of its generation.<\/p>\n
(iii) Seller will obtain a new separate air permit, if
\nrequired under Environmental Laws, covering air emissions and operation of air
\nemission control equipment associated with Seller’s Remediation obligations
\nunder Section 4.1 of this Agreement, including the groundwater extraction and
\ntreatment system. These permit conditions are contained currently in the
\nDecember 1998 revision to Permit No. 8602688 issued July 24, 1997.<\/p>\n
(e) Seller and Buyer will coordinate on issues related to
\nSeller’s Remediation at the NIBW Site, as follows:<\/p>\n
(i) Seller and Buyer will each, at its sole cost and
\nexpense, appoint a “Remediation Project Manager” as a contact person with
\nrespect to the Seller’s Remediation. The Remediation Project Managers will meet
\nonsite upon closing and once each quarter, or more frequently if necessary or as
\notherwise agreed between them, to discuss matters relating to the coordination
\nof the Seller’s Remediation, including scheduling, areas in which work will take
\nplace at particular times, the manner in which work will be done, and other
\nissues or problems that may arise. The Seller’s Remediation Project Manager will
\nmaintain and update a schedule for the Seller’s Remediation and will provide
\nupdated schedules to the Buyer’s Remediation Project Manager. To address any
\nissues that may arise relating to such coordination, the Remediation Project
\nManagers or their responsible designees will be available in person, by
\ntelephone, or other reasonable means as the Project Managers agree, at all times
\nwhen Seller’s employees, contractors, or agents are on the Owned Premises. The
\nresponsible designees of the Remediation Project Manager may include an
\nappropriate person or persons retained as a contractor of Seller or Buyer. If
\nBuyer’s Remediation Project Manager and Seller’s Remediation Project Manager are
\nunable to reach mutual agreement on a coordination issue, the parties shall
\ninform Buyer’s and Seller’s legal counsel and schedule a meeting to resolve the
\ncoordination issue.<\/p>\n
(ii) Buyer will, to the extent reasonably requested
\nby Seller: (A) cooperate with Seller in all Remediation at the Owned Premises;
\n(B) make available appropriate personnel to meet on or off the Owned Premises
\nwith Seller and its environmental consultants or other representatives on
\nmatters relating to Remediation; (C) make available appropriate personnel to
\nmeet with federal, state and local environmental regulatory officials when and
\nas requested by such officials or as reasonably requested by Seller; (D) provide
\nSeller reasonable access to or copies of such documents, records and other data
\nof Buyer as Seller may reasonably require in connection with the NIBW Site and
\nany third party claims related thereto; and (E) cooperate with Seller to
\nminimize Seller’s Remediation costs.<\/p>\n
(f) Seller will furnish to Buyer, from time to time and upon
\nrequest, copies of all material correspondence (including all status reports,
\noperational summaries, statements of work, analytical information, permits,
\napplications, or approvals) between the Seller or its environmental consultants
\nand contractors and EPA or any other federal, state, or local governmental
\nentity relating to Seller’s Remediation at the Owned Premises. In the event the
\nBuyer receives any information relating to the Seller’s Remediation, the Buyer
\nwill provide this information to the Seller.<\/p>\n
(g) Seller will be responsible for the cost of any
\nrepairs, replacements or damages to Buyer’s improvements, fixtures and
\nappurtenances within the Owned Premises to the extent caused by the act or
\nomission of Seller. Buyer will be responsible for the cost of any repairs,
\nreplacements or damages to Seller’s improvements, fixtures and appurtenances
\nwithin the Owned Premises, including without limitation Seller’s remediation
\nequipment, to the extent caused by the act or omission of Buyer.<\/p>\n
(h) Seller will retain ownership and responsibility
\nfor the control, operation, and management of all equipment, including
\nmonitoring and extraction well apparatus, pipelines, and treatment equipment,
\nused for Seller’s Remediation at the Owned Premises. Seller will remove, in a
\ntimely manner, all such equipment when EPA has determined that Seller has
\ncompleted its Remediation obligations at the Owned Premises. Schedule 4.2(h) is
\na survey showing the location of all remediation equipment on the Owned
\nPremises.<\/p>\n
(i) The Consent Decree between Seller and EPA dated August
\n11, 1993, Docket No. 92-2314-PHX PGR, provides that EPA shall be granted an
\neasement to the Owned Premises for access in connection with Seller’s
\nobligations under Section 4.1 of this Agreement. In cooperation with Buyer,
\nSeller will prepare a proposed easement and negotiate an easement providing EPA
\nand Seller access to Seller’s remediation equipment; provided however that the
\neasement shall not enlarge the access rights of Seller under this Agreement.<\/p>\n
(j) Seller and Buyer will cooperate to obtain utility
\nservice for Seller’s Remediation within the Owned Premises, whether or not such
\nutility lines serve portions of the Owned Premises or other persons, in order to
\nprovide water, electric, telephone, sanitary sewer, storm sewer and other
\nutility services to Seller in connection with Seller’s Remediation;<\/p>\n
provided:<\/p>\n
(i) Seller, at its sole cost and expense, will
\nobtain all necessary utility approvals prior to making any such connections;<\/p>\n
(ii) Seller will install a separate meter to measure
\nelectricity usage related to Seller’s Remediation and arrange for the local
\nelectricity provider to bill Seller directly for this service;<\/p>\n
(iii) Seller will reimburse Buyer for all reasonable
\ncosts which Buyer incurs as a result of Seller’s use of such utilities; and<\/p>\n
(iv) Schedule 4.2(j) lists all utility services
\ncurrently required for Seller’s Remediation at the Owned Premises.<\/p>\n
(k) Seller shall use commercially reasonable efforts to
\nminimize adverse impacts to the Owned Premises in order to comply with Seller’s
\nobligations under Section 4.1 of this Agreement. Seller, at its sole cost and
\nexpense, may make such alterations, additions and improvements in and to the
\nOwned Premises as Seller reasonably deems necessary in order to comply with its
\nobligations under Section 4.1 of this Agreement, including the removal of water,
\nsoil or subsoil from the Owned Premises, subject to the following:<\/p>\n
(i) Buyer will cooperate with Seller in securing (at
\nSeller’s sole cost and expense) any Permits required with respect to such
\nalterations; and<\/p>\n
(ii) Seller may not conduct the above activities
\nunless Seller obtains prior written approval from Buyer, which shall not be
\nunreasonably withheld.<\/p>\n
(l) Buyer agrees that it will use commercially reasonable
\nefforts to require any tenants or future buyers of the Owned Premises to agree
\nto the terms of this Section 4.2 with respect to access and Remediation
\nactivities to allow Seller to comply with its Remediation obligations related to
\nthe NIBW Site.<\/p>\n
ARTICLE V<\/p>\n
INDEMNIFICATION<\/p>\n
5.1 Indemnification by Seller.<\/p>\n
(a) Seller will indemnify and hold harmless Buyer against
\nany and all Damages incurred by Buyer in connection with or arising from:<\/p>\n
(i) any breach by Seller of, or any other failure of
\nSeller to perform, any of its covenants, agreements, or obligations in this
\nAgreement; or<\/p>\n
(ii) any breach of any warranty or the inaccuracy of
\nany representation of Seller contained in this Agreement.<\/p>\n
(b) Seller will indemnify and hold harmless Buyer against
\nany and all Environmental Claims asserted, but only to the extent that such
\nEnvironmental Claims are based upon or otherwise relate to:<\/p>\n
(i) subject to 5.2(b)(ii), Seller’s performance of
\nits obligations under Section 4.1of this Agreement with respect to Remediation
\nof the NIBW Site; or<\/p>\n
(ii) any third party claims, including but not
\nlimited to claims for natural resource damage, relating to Seller’s Remediation
\nof the NIBW Site; or<\/p>\n
(iii) any Environmental Liability for the offsite
\ndisposal of Hazardous Substances by Seller on or before the Closing Date; or<\/p>\n
(iv) any Condition in, at, on, under, or emanating
\nfrom the Premises which Condition (A) exists at or prior to the Closing Date;
\n(B) was caused by Seller; and (C) either violates Environmental Law, requires
\nRemediation under Environmental Law, or involves onsite contamination at the
\nOwned Premises that Buyer otherwise needs to address; provided, however, that
\nthis Section 5.1(b)(iv) shall not apply to Environmental Claims related to (i)
\nasbestos in buildings at the Owned Premises; or (ii) improvements or repairs to
\nthe Owned Premises unless the Damages involved exceed $300,000.<\/p>\n
(c) Seller’s obligation to indemnify under Section 5.1 of
\nthis Agreement shall be subject to the procedures for indemnification in Section
\n7.5 of the Asset Purchase Agreement.<\/p>\n
5.2 Indemnification by Buyer.<\/p>\n
(a) Buyer will indemnify and hold harmless Seller
\nagainst any and all Damages incurred by Seller in connection with or arising
\nfrom any breach by Buyer of, or any other failure of Buyer to perform, any of
\nits covenants, agreements, or obligations under this Agreement.<\/p>\n
(b) Buyer will indemnify and hold harmless Seller against
\nany and all Environmental Claims asserted by a third party, but only to the
\nextent that such Environmental Claims are based upon or otherwise relate to:<\/p>\n
(i) any Condition in, at, on, under, or emanating from
\nthe Premises, which Condition (A) did not exist at or prior to the Closing Date;
\n(B) was caused by Buyer; and (C) either violates an Environmental Law or
\nrequires Remediation under Environmental Law; or<\/p>\n
(ii) any Condition or release of a Pollutant in, at, on,
\nunder, or emanating from the Premises, including any related natural resource
\ndamage claims, which Condition (A) did not exist at or prior to the Closing Date
\nand (B) was caused by Buyer that affects Remediation of the NIBW Site; or<\/p>\n
(iii) any Environmental Liability for the offsite
\ndisposal of Hazardous Substances by Buyer after the Closing Date.<\/p>\n
(c) Buyer’s obligation to indemnify under Section 5.2 of
\nthis Agreement shall be subject to the procedures for indemnification in Section
\n7.5 of the Asset Purchase Agreement.<\/p>\n
5.3 Limitation on Indemnification Obligation.<\/p>\n
(a) There will be no dollar or time limitations
\napplicable to those indemnification obligations set forth in Sections 5.1(b)(i),
\n5.1(b)(ii), 5.1(b)(iii), 5.2(b)(ii), and 5.2(b)(iii).<\/p>\n
(b) Subject to Section 5.3(a), the parties’
\nobligations to indemnify under Sections 5.1(a), 5.1(b)(iv), 5.2(a), and
\n5.2(b)(i) shall be subject to the threshold and cap limitations set forth in
\nSection 7.3 of the Asset Purchase Agreement.<\/p>\n
(c) To the extent any obligation to indemnify is
\ncovered by both Section 5.3(a) and Section 5.3(b), Section 5.3(a) shall govern.<\/p>\n
(d) The indemnification obligation set forth in
\nSections 5.1(b)(iv) and 5.2(b)(i) shall expire on the tenth (10th) anniversary
\nof the Closing Date (the “Environmental Termination Date”). Except as provided
\nin Section 5.3(a), neither party will be responsible as an indemnifying party
\nfor any Environmental Claim first asserted after the Environmental Termination
\nDate.<\/p>\n
(e) With respect to any claim pursuant to
\nsubparagraph 5.1(b)(iv) or 5.2(b)(i), the parties agree that it will be
\npresumed, subject to rebuttal by a preponderance of the evidence, that any
\nCondition subject to a claim for indemnification within five (5) years from the
\nClosing Date existed at or prior to the Closing Date, and that any Condition
\nsubject to a claim for indemnification after five (5) years from the Closing
\nDate did not exist at or prior to the Closing Date.<\/p>\n
(f) All applicable statutes of limitations and defenses
\nbased upon the passage of time will be tolled while the procedures specified in
\nthis Section 5.3 are pending. The parties will take such actions, if any, that
\nare necessary in order to effectuate such tolling.<\/p>\n
(g) Each party will continue to perform its obligations
\nunder this Agreement pending final resolution of any dispute arising out of or
\nrelating to this Agreement, except to the extent that such continued performance
\nwill cause irreparable damage to such party.<\/p>\n
(h) All deadlines specified in this Section 5.3: (i) may be
\nextended by mutual written agreement of the parties, and (ii) will automatically
\nbe extended for a reasonable period of time in order to permit the diligent
\npursuit of a cure of any dispute.<\/p>\n
5.4 Survival. All representations and warranties contained herein
\nwill remain operative and in full force and effect regardless of any
\ninvestigation made by or on behalf of Buyer or Seller and any amounts paid
\nhereunder, and shall expire four (4) years after the Closing Date.<\/p>\n
ARTICLE VI<\/p>\n
MISCELLANEOUS<\/p>\n
6.1 All notices, requests, demands and other communications
\nhereunder shall be in writing, addressed as follows:<\/p>\n
If to Seller: Motorola, Inc.
\n 1301 E. Algonquin Road
\n Schaumburg, Illinois 60196
\n Facsimile No.: (847) 538-2491
\n Attn: Bob McCall<\/p>\n
and Motorola, Inc.
\n Law Department
\n 1303 E. Algonquin Road
\n Schaumburg, Illinois 60196
\n Facsimile No.: (847) 576-3628
\n Attn: General Counsel<\/p>\n
with a copy (which shall not constitute notice) to:<\/p>\n
Wiley, Rein & Fielding
\n 1776 K Street, N.W.
\n Washington, D.C. 20006
\n Facsimile No.: (202) 719-7049
\n Attn: Kay Tatum<\/p>\n
If to Buyer: General Dynamics Corporation
\n 3190 Fairview Park Drive
\n Falls Church, VA 22042
\n Facsimile No.: (703) 876-3554
\n Attn: David A. Savner<\/p>\n
with a copy (which shall not constitute notice) to:<\/p>\n
Jenner & Block, LLC
\n One IBM Plaza
\n Chicago, Illinois 60611
\n Facsimile No.: (312) 840-8711
\n Attn: Thomas A. Monson<\/p>\n
or to such other address as Buyer or Seller may designate by written notice to
\nthe other parties hereto. Any such notices, requests, demands or other
\ncommunications shall be deemed to have been duly given when received if
\ndelivered personally or, if mailed, on the date five (5) days after the date so
\ndeposited in the mails, postage prepaid, return receipt requested or on the day
\nfollowing the day sent if sent by prepaid overnight delivery service. Notices,
\nrequests, demands and other communications hereunder may be delivered by
\nfacsimile transmission if confirmation by sender is made within three (3)
\nbusiness days thereafter. All periods of notice will be measured from the date
\nof deemed delivery thereof.<\/p>\n
6.2 Nondisclosure. Neither Buyer nor Seller shall issue any press
\nrelease or make any other public disclosure (including disclosure to public
\nofficials) with respect to this Agreement or the transactions contemplated by
\nthis Agreement, except as required by law, without the prior approval of the
\nother party, which approval shall not be unreasonably withheld; provided, that
\neither party may, if considered necessary by its counsel to fulfill its
\nobligations as a publicly traded corporation, respond to inquiries and issue
\nsuch releases as it considers necessary and appropriate, if it notifies the
\nother party in advance of the substance of such proposed response or proposed
\nrelease and gives such party reasonable opportunity for comment prior to such
\nresponse or release.<\/p>\n
6.3 Limitation of Liability. NOTWITHSTANDING ANY OTHER PROVISION OF
\nTHIS AGREEMENT, IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR SPECIAL,
\nINCIDENTAL, INDIRECT, COLLATERAL, CONSEQUENTIAL OR PUNITIVE DAMAGES OR LOST
\nPROFITS IN CONNECTION WITH ANY CLAIMS, LOSSES, DAMAGES, OR INJURIES ARISING OUT
\nOF THE CONDUCT OF SUCH PARTY PURSUANT TO THIS AGREEMENT.<\/p>\n
6.4 Governing Law; Jurisdiction. This Agreement will be governed and
\nconstrued under the internal laws (but not the principles of conflicts of laws)
\nof the State of Illinois. Each <\/p>\n
of Seller and Buyer consents to the exclusive jurisdiction of the federal courts
\nof Illinois for any Proceeding in connection with this Agreement or the
\ntransactions contemplated hereby and agrees that any such Proceeding may be
\nbrought only in such courts. Each of Seller and Buyer further waives any
\nobjection to the laying of venue for any Proceeding in such courts. Each party
\nwill accept and acknowledge service of any and all process that may be served in
\nany Proceeding. Each party agrees that any service of process upon it mailed by
\nregistered or certified mail, return receipt requested to such party at the
\naddress provided in Section 6.1 above will be deemed in every respect effective
\nservice of process upon such party in any such Proceeding. Each party will waive
\nany right it might have to a trial by jury in any such Proceeding.<\/p>\n
6.5 Entire Agreement. Except as provided by Sections 5.1(c),
\n5.2(c), 5.3(b), and 6.18, this Agreement, together with all exhibits and
\nschedules hereto, cover the entire understanding of the parties hereto,
\nconcerning environmental, worker safety and health issues related to the assets
\nand liabilities that are the subject of the Asset Purchase Agreement, and
\nsupersede all prior agreements or understandings relating to any of the subject
\nmatters hereof. In the event of conflict or other inconsistency between any
\nterm(s) of this Agreement and any term(s) of the Asset Purchase Agreement, the
\nterm(s) of this Agreement will take precedence and otherwise govern the parties’
\nrights and obligations. No modification or amendment of the terms and conditions
\nof this Agreement will be effective unless in writing and signed by the parties
\nor their respective duly authorized agents.<\/p>\n
6.6 Successors and Assigns. This Agreement inures to the
\nbenefit of, and is binding upon, the successors, permitted assigns, and personal
\nrepresentatives of the parties hereto. Neither party may assign its rights or
\nobligations under this Agreement without the express written consent of the
\nother party, except that Buyer may, without the prior written consent of Seller,
\nassign its rights under this Agreement to any of its direct or indirect wholly
\nowned subsidiaries, provided, that Buyer shall remain liable for all of its
\nobligations under this Agreement.<\/p>\n
6.7 Headings. This Agreement will not be interpreted by
\nreference to any of the titles or headings to the sections or paragraphs of this
\nAgreement, which have been inserted for convenience purposes only and are not
\ndeemed a part hereof.<\/p>\n
6.8 Schedules; Exhibits. This Agreement is deemed to include
\nall of the schedules and exhibits hereto, which are made a part hereof by this
\nreference thereto.<\/p>\n
6.9 Counterparts. This Agreement may be executed in
\ncounterparts, both of which together will be deemed to constitute one and the
\nsame instrument.<\/p>\n
6.10 Severability. If any provision of this Agreement is held
\ninvalid or unenforceable by a court of competent jurisdiction, such provision
\nthereupon will be deemed modified only to the extent necessary to render that
\nprovision either valid or excluded from this Agreement, as the situation may be
\nrequired; and this Agreement will be enforced and construed as if such provision
\nhad been included herein as so modified, or had not been included herein, as the
\ncase may be.<\/p>\n
6.11 No Third Party Beneficiaries. This Agreement will not
\nconfer any rights or remedies on any person other than the parties hereto and
\ntheir respective successors and permitted assigns.<\/p>\n
6.12 No Waiver. Any failure or delay on the part of either
\nparty in the exercise of any right or privilege hereunder will not operate as a
\nwaiver thereof, nor will any single or partial exercise of any such right or
\nprivilege preclude other or further exercise thereof or any other right or
\nprivilege.<\/p>\n
6.13 Termination. This Agreement will have no fixed
\ntermination date.<\/p>\n
6.14 Joint Litigation. If any Environmental Liability is
\nsubject to a defense, indemnity and hold harmless obligation under this
\nAgreement, and if such Environmental Liability includes obligations or
\nliabilities which are not included within such defense, indemnity and hold
\nharmless obligation, the parties will cooperate in handling such Environmental
\nLiability (including all defense, negotiation and settlement discussions related
\nthereto), in order to resolve such Environmental Liability in a manner that is
\nconsistent with the parties’ respective rights and obligations under this
\nAgreement.<\/p>\n
6.15 No Admissions. By signing this Agreement, the parties
\nneither admit nor deny any responsibility or liability concerning any alleged or
\npossible non-compliance with Laws, or otherwise admit or deny any facts or
\nconclusions of law. Further, neither this Agreement, nor any term or condition
\nof this Agreement, will constitute, or be considered as evidence of, any
\nviolation of any Law.<\/p>\n
6.16 Other Obligations. The parties’ rights, responsibilities
\nand obligations under this Agreement are in addition to any and all legal
\nrights, responsibilities and obligations imposed upon or granted to- them, or
\nany of them, by any legal requirement.<\/p>\n
6.17 Reservation of Rights. By signing this Agreement, and
\nexcept as specifically provided in this Agreement:<\/p>\n
(a) Each party expressly reserves all claims,
\ncounterclaims, causes of action, demands, defenses, and other legal rights and
\nremedies (whether in law or in equity) which that party possesses or may possess
\nagainst the other party, the government, and any other third party.<\/p>\n
(b) Nothing in this Agreement will constitute, or be
\nconstrued as constituting, a waiver or release from any claim, counterclaim,
\ncause of action, demand, defense, or other legal right or remedy (whether in law
\nor in equity) which that party possesses or may possess against the other party,
\nthe government, or any other third party.<\/p>\n
6.18 Dispute Resolution. Any dispute related to this
\nAgreement shall be subject to the procedures for Dispute Resolution in Section
\n10.5 of the Asset Purchase Agreement, except as provided in Section 4.2(e)(i) of
\nthis Agreement.<\/p>\n
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
\nAgreement with legal and binding effect as of the date and year that it is
\nsigned by the parties or their respective duly authorized agents..<\/p>\n
SELLER: MOTOROLA, INC.<\/p>\n
By: \/s\/Keith Bane
\n ———————————
\n Name: Keith Bane
\n Title: Executive Vice President<\/p>\n
BUYER:<\/p>\n
By: \/s\/Ken Dahlberg
\n ———————————
\n Name: K. C. Dahlberg
\n Title: Executive Vice President<\/p>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[7614,8265],"corporate_contracts_industries":[9516,9475],"corporate_contracts_types":[9623,9622],"class_list":["post-43301","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-general-dynamics-corp","corporate_contracts_companies-motorola-inc","corporate_contracts_industries-telecommunications__equipment","corporate_contracts_industries-aerospace__ships","corporate_contracts_types-planning__asset","corporate_contracts_types-planning"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/43301","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=43301"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=43301"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=43301"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=43301"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}