\nExhibit A Certificate of Incorporation
\nExhibit B By-Laws
\nExhibit C Shareholders Rights Plan
\nExhibit D Note of Conoco Inc., dated July 20, 1998 and
\n Conoco Guarantee
\nExhibit E Employee Matters Agreement
\nExhibit F Transitional Services Agreement
\nExhibit G Tax Sharing Agreement
\nExhibit H Natural Gas Supply Agreement
\nExhibit I Information Services Agreements
\nExhibit J Motor Carrier Contract
\nExhibit K Registration Rights Agreement
\nExhibit L Form of Employee Benefits Note
\nExhibit M Mont Belvieu Agreements<\/p>\n SCHEDULES<\/p>\n
Schedule 1(a) Mixed-Use Subsidiaries
\nSchedule 1(b) Transferred Business Companies
\nSchedule 1(c) Construction Fleet
\nSchedule 4.4 Excluded Assets
\nSchedule 6.2 Registration Statement
\nSchedule 7.2 Delayed Companies
\nSchedule 7.10(a) Conoco Actions
\nSchedule 7.10(b) DuPont Actions
\nSchedule 9.3 DuPont Guarantees
\nSchedule 9.5 Intercompany Agreements
\nSchedule 10.5 Named Insured
\nSchedule 11.1(a) Transferred Environmental Assets
\nSchedule 11.1(b) Retained Environmental Assets
\nSchedule 11.2(d) Conoco Liabilities for Environmental Claims
\nSchedule 11.3(d) DuPont Liabilities for Environmental Claims
\n<\/c><\/s><\/caption>\n<\/table>\n
v<\/p>\n
7
\n RESTRUCTURING, TRANSFER AND SEPARATION AGREEMENT<\/p>\n
RESTRUCTURING, TRANSFER AND SEPARATION AGREEMENT (this
\n“Agreement”), dated as of October 27, 1998, by and between E.I. du Pont de
\nNemours and Company, a Delaware corporation (“DuPont”) and Conoco Inc. (formerly
\nknown as Conoco Energy Company), a Delaware corporation (“Conoco”).<\/p>\n
WHEREAS, in addition to its chemicals, life sciences, fibers,
\npolymers, and other materials businesses, DuPont has been engaged through
\nConoco and its various predecessor companies and their various Subsidiaries (as
\ndefined herein) and divisions in exploring for, developing, producing, refining,
\ntransporting, marketing and distributing oil and gas and associated by-products
\nin connection with the Transferred Business (as defined herein);<\/p>\n
WHEREAS, Conoco, Conoco Inc. (formerly known as Continental
\nOil Company), a Delaware corporation (“CI”) and their various predecessor
\ncompanies and their various Subsidiaries and divisions have been engaged in
\nvarious businesses, primarily exploring for, developing, producing, refining,
\ntransporting, marketing and distributing oil and gas and associated by-products
\nand the manufacture, sale and distribution of chemicals;<\/p>\n
WHEREAS, the Board of Directors of DuPont has determined that
\nit is in the best interests of DuPont and its stockholders for Conoco to offer
\nshares of Class A Common Stock, par value $.01 per share (the “Class A Common
\nStock”) of Conoco for sale to the public pursuant to an initial public offering
\n(“IPO”) and in connection therewith for DuPont and Conoco to separate their
\nrespective businesses so that from and after the Effective Date the Transferred
\nBusiness will be held by Conoco and its Subsidiaries and divisions (the
\n“Separation”);<\/p>\n
WHEREAS, as set forth herein and subject to the terms and
\nconditions hereof, DuPont wishes to transfer and assign to Conoco, and to cause
\nits Subsidiaries to transfer and assign to Conoco, the assets of the various
\ndivisions, and the stock and other equity securities representing Conoco’s
\nownership interest in various Subsidiaries and other entities in and through
\nwhich the Transferred Business is conducted, in exchange for the assumption by
\nConoco or one or more of the Transferred Business Companies (as defined herein)
\nof the liabilities and obligations relating to the Conoco Business;
\n 8
\n WHEREAS, DuPont and Conoco have determined that it is
\nnecessary and desirable to set forth the principal transactions required to
\neffect the Restructuring (as defined herein) and the Separation and to set forth
\nother agreements that will govern certain other matters in connection with the
\nRestructuring and the Separation.<\/p>\n
NOW, THEREFORE, in consideration of the premises or promises
\nand the mutual covenants and agreements contained herein and intending to be
\nlegally bound hereby, the parties hereto hereby agree as follows:<\/p>\n
ARTICLE I<\/p>\n
DEFINITIONS<\/p>\n
Section 1.1 General. As used in this Agreement, capitalized
\nterms shall have the following meanings (such meanings to be equally applicable
\nto both the singular and plural forms of the terms defined):<\/p>\n
Action: shall mean any action, claim, suit, arbitration,
\nsubpoena, discovery request, proceeding or investigation by or before any court
\nor grand jury, any Governmental Authority or arbitration tribunal.<\/p>\n
AEP Proposed Joint Ventures: shall mean the proposed joint
\nventures described in the letter of intent, dated October 2, 1997 among AEP
\nResources, Inc., CI and DuPont.<\/p>\n
Affiliate: shall mean, with respect to any specified Person, a
\nPerson that, directly or indirectly, through one or more intermediaries,
\ncontrols, or is controlled by, or is under common control with, such specified
\nPerson. For purposes of this definition, “control” when used with respect to any
\nspecified Person means the power to direct the management and policies of such
\nPerson, directly or indirectly, whether through ownership of voting securities,
\nby contract or otherwise; and the terms “controlling” and “controlled” have
\nmeanings correlative to the foregoing.<\/p>\n
Agreement: shall have the meaning set forth in the recitals.<\/p>\n
Agrico Inc.: shall mean American Agricultural Chemical
\nCompany, a Delaware corporation.<\/p>\n
2
\n 9
\n Appropriate Conoco Subsidiary: shall have the meaning set
\nforth in Section 6.2(b).<\/p>\n
Appropriate Retained Subsidiary: shall have the meaning set
\nforth in Section 6.2(a).<\/p>\n
Asset: shall mean, with respect to any Person, any and all of
\nsuch Person’s title and ownership interest in and to all properties, assets,
\nclaims, Contracts and businesses of every kind, character and description,
\nwhether real, personal or mixed, whether accrued, contingent or otherwise, and
\nwherever located, including, without limitation, the following: (i) all cash,
\ncash equivalents, notes and accounts receivable (whether current or
\nnon-current); (ii) all certificates of deposit, banker’s acceptances and other
\ninvestment securities; (iii) all real properties, including pipelines,
\nrefineries, plants, buildings and other structures and improvements (including
\nconstruction in progress) located thereon, fixtures contained therein and
\nappurtenances thereto; (iv) all leasehold improvements and all machinery,
\nequipment (including all transportation and office equipment), fixtures, trade
\nfixtures and furniture; (v) all office supplies, production supplies, spare
\nparts, other miscellaneous supplies and other tangible property of any kind;
\n(vi) all capital stock, partnership interests and other equity or ownership
\ninterests or rights, directly or indirectly, in any Subsidiary or other entity;
\n(vii) all raw materials, work-in-process, finished goods, consigned goods and
\nother inventories; (viii) all registered and unregistered trademarks, service
\nmarks, service names, trade styles and trade names (including, without
\nlimitation, trade dress and other names, marks and slogans) and all associated
\ngoodwill; all statutory, common law and registered copyrights; all patents; all
\napplications for any of the foregoing together with all rights to use all of the
\nforegoing and all other rights in, to, and under the foregoing; all know-how,
\ninventions, discoveries, improvements, processes, formulae (secret or
\notherwise), specifications, trade secrets, whether patentable or not, licenses
\nand other similar agreements, confidential information, and all drawings,
\nrecords, books or other indicia, however evidenced, of the foregoing; (ix) all
\nrights existing under all Contracts; (x) all rights (including ownership rights
\nor rights arising under Contracts) existing, relating to all computer hardware,
\nsoftware, computer programs, systems and documentation relating thereto; all
\ndatabases and reference and resource materials; (xi) all prepayments, deposits,
\nperformance bonds or prepaid expenses and deferred tax accounts to the extent
\nthey constitute an asset and not a liability of such party; (xii) all claims,
\ncauses of action, choses in action, rights of recovery and rights of set-off of
\nany kind; (xiii) all customer lists and records pertaining to customers and
\naccounts, personnel records, all lists and records pertaining to suppliers and
\nagents, and all books,<\/p>\n
3
\n 10
\nledgers, files and business records of every kind; (xiv) all advertising
\nmaterials and all other printed or written materials, including purchase orders,
\nforms, labels, shipping materials, catalogues, sales brochures, operating
\nmanuals, and instructional documents; (xv) all permits, licenses, approvals and
\nauthorizations, to the extent transferable, of Governmental Authorities or third
\nparties relating to the ownership, possession or operation of the Assets; (xvi)
\nall goodwill as a going concern and all other intangible properties; (xvii) all
\nemployee contracts, including, without limitation, the right thereunder to
\nrestrict an employee from competing in certain respects; and (xviii) all trucks,
\nautomobiles, railcars and other vehicles, and all vessels, tankers and barges.<\/p>\n
Assumed Liabilities: shall have the meaning set forth in
\nSection 4.1.<\/p>\n
Audit: shall mean any audit, assessment of Taxes, other
\nexamination by any Tax Authority, proceeding, or appeal of such a proceeding
\nrelating to Taxes, whether administrative or judicial.<\/p>\n
Cain Chemical: shall mean Cain Chemical Inc., a Delaware
\ncorporation.<\/p>\n
Cash Settlement Date: shall have the meaning set forth in
\nSection 9.1(a).<\/p>\n
Charter Amendment: shall have the meaning set forth in Section
\n5.6(b).<\/p>\n
Christiana: shall mean Christiana Insurance Limited, a Bermuda
\ncorporation.<\/p>\n
CI: shall have the meaning set forth in the recitals.<\/p>\n
Class A Common Stock: shall have the meaning set forth in the
\nrecitals.<\/p>\n
Class B Common Stock: shall mean Class B Common Stock, par
\nvalue $.01 per share, of Conoco.<\/p>\n
Code: shall mean the Internal Revenue Code of 1986, as
\namended, or any successor statute.<\/p>\n
4
\n 11
\n Combined Limit Losses: shall have the meaning set forth in
\nSection 10.2.<\/p>\n
Confidential Business Information: shall have the meaning set
\nforth in Section 8.5(a)(iii).<\/p>\n
Confidential Information: shall have the meaning set forth in
\nSection 8.5(a)(i)<\/p>\n
Confidential Operational Information: shall have the meaning
\nset forth in Section 8.5(a)(ii).<\/p>\n
Conoco: shall have the meaning set forth in the recitals.<\/p>\n
Conoco Action: shall have the meaning set forth in Section
\n7.10.<\/p>\n
Conoco Board: shall mean the Board of Directors of Conoco.<\/p>\n
Conoco Books and Records: shall mean the books and records of
\nDuPont and its Subsidiaries (or true and complete copies thereof), including all
\ncomputerized books and records owned by DuPont and its Subsidiaries, to the
\nextent they primarily relate to the Transferred Business or the Transferred
\nAssets, including, but not limited to, the minute books, corporate charters and
\nby-laws or comparable constitutive documents, records of share issuances, and
\nrelated corporate records of the Transferred Business Companies, all such books
\nand records primarily relating to Transferred Employees, the purchase of
\nmaterials, supplies and services, the manufacture and sale of products by the
\nTransferred Business or dealings with customers of the Transferred Business and
\nall files primarily relating to any Action the Liability with respect to which
\nis included in Assumed Liabilities, except that no portion of the books and
\nrecords of DuPont or the Retained Subsidiaries containing minutes of meetings of
\nany board of directors of any of them shall be included. Notwithstanding the
\nforegoing, “Conoco Books and Records” shall not include any Tax Returns or other
\ninformation, documents or materials relating to Taxes.<\/p>\n
Conoco Business: shall mean the businesses in which, and the
\nactivities as to which, the Conoco Group or any member thereof was formerly or
\nis currently engaged (including exploring for, producing, developing, refining,
\ntransporting, marketing and distributing oil and gas and associated by-products
\nthereof, any chemical business or activities and any other business or
\nactivities), and the<\/p>\n
5
\n 12
\nbusiness and activities which were formerly or are currently conducted by any of
\nsuch entities, businesses or divisions through use or ownership of the
\nTransferred Assets or any other Assets of the Conoco Group, including, but not
\nlimited to, (i) the Transferred Business, (ii) the business and activities
\nformerly conducted by Conoco’s chemicals division (including, but not limited
\nto, operations sold to Vista Chemical) and all activities conducted by DuPont or
\nany of its Subsidiaries in connection therewith or related thereto, (iii) the
\noperations of Agrico Inc., (iv) exploring for, producing, developing, refining,
\ntransporting, marketing and distributing oil and gas and associated by-products
\nthereof by DuPont or any of its Subsidiaries for the benefit of the Conoco Group
\nor any member thereof, including the business and activities of DuPont France
\nand DuPont Italy (v) the business and activities conducted through, and
\nownership of, CI’s interest in the Pocahontas Partnership, (vi) the activities
\nand operations of DuPont, any of its Subsidiaries and any of their employees
\n(including, but not limited to, the activities and operations of Sentinel and
\nDERS) to the extent performed for or on behalf of the Conoco Business on or
\nbefore the Effective Date (as defined without giving effect to this clause (vi))
\nand (vii) the actions and activities of Conoco and the Transferred Business
\nCompanies in connection with the AEP Proposed Joint Ventures. The “Conoco
\nBusiness” specifically excludes (i) the business and activities which were
\nformerly or are currently conducted by CONSOL Energy and its controlled
\naffiliates and joint ventures in which it is a participant and Pitt-Consol
\n(other than through CI’s interest in the Pocahontas Partnership), (ii) the
\nbusinesses sold to Cain Chemical, including the operations at Matagorda and
\nChocolate Bayou, Texas, (iii) the businesses and activities of DuPont
\nNetherlands and (iv) the businesses and activities of Sentinel except as
\nprovided in clause (vi) above.<\/p>\n
Conoco Environmental Liabilities: shall have the meaning set
\nforth in Section 11.2.<\/p>\n
Conoco Group: shall mean collectively, Conoco, CI, and the
\nother Transferred Business Companies, any of their predecessor companies or
\nbusinesses or any of their Subsidiaries, business units or divisions.<\/p>\n
Conoco Guarantee: shall mean the guarantee by Conoco, dated as
\nof July 24, 1998, of CI’s obligations under the Note, dated July 20, 1998 and
\nattached hereto as part of Exhibit D.<\/p>\n
Conoco Master Note: shall mean the promissory notes evidencing
\nindebtedness of CI to DuPont under the DuPont Master Note Agreement.<\/p>\n
6
\n 13
\n Conoco Party: shall have the meaning set forth in Section
\n6.2(a).<\/p>\n
Conoco Patents: shall mean (a) all U.S. and foreign patents,
\npatent applications and patent disclosures (including all reissues, divisions,
\ncontinuations, continuations-in-part, substitutions, extensions, or renewals of
\nany of the foregoing) owned by or under obligation of assignment to Conoco or
\nany Transferred Business Company or with respect to which Conoco or any
\nTransferred Business Company has the power to grant an immunity from suit for
\ninfringement, (b) all U.S. and foreign patents, patent applications and patent
\ndisclosures (including all reissues, divisions, continuations,
\ncontinuations-in-part, substitutions, extensions, or renewals of any of the
\nforegoing) granted after the Effective Date by the applicable Governmental
\nAuthorities based on all applications owned by or under obligation of assignment
\nto Conoco or any Transferred Business Company or with respect to which Conoco or
\nany Transferred Business Company has the power to grant an immunity from suit
\nfor infringement, (c) all U.S. and foreign patent, patent application, and
\npatent disclosure (including all reissues, divisions, continuations,
\ncontinuations-in-part, substitutions, extensions, or renewals of any of the
\nforegoing) rights which are owned by or under obligation of assignment to Conoco
\nor any Transferred Business Company resulting from Joint Invention Conceptions
\ndocumented in invention disclosures as of the Effective Date, and (d) the patent
\nfor gas-to-liquids technology, to the extent not otherwise owned by Conoco or
\none of the Transferred Business Companies at the Effective Date.<\/p>\n
Conoco Payables: shall have the meaning set forth in Section
\n9.1(b).<\/p>\n
Conoco Rights Plan: shall have the meaning set forth in
\nSection 2.4(a).<\/p>\n
CONSOL Energy: shall mean CONSOL Energy Inc., a Delaware
\ncorporation.<\/p>\n
Construction Fleet: shall mean the vehicles, Equipment and
\nmachinery utilized in construction which are owned by DuPont or a Retained
\nSubsidiary and which, in whole or in part, from time to time, are used in the
\nTransferred Business or operated by employees of Conoco or a Transferred
\nBusiness Company, including but not limited to the items set forth on Schedule
\n1(c).<\/p>\n
Contract: shall mean any contract, agreement, lease, Equipment
\nlease, license, sales order, purchase order, instrument or other commitment or
\narrangement<\/p>\n
7
\n 14
\nthat is binding on any Person or entity or any part of its property under
\napplicable Law.<\/p>\n
Conveyancing and Assumption Instruments: shall mean
\ncollectively, the various bills of sale, undertakings and other agreements,
\ninstruments and other documents to be entered into in order to effect the
\nRestructuring, and the transfer of Assets and the assumption of Liabilities in
\nthe manner contemplated by Section 2.3.<\/p>\n
Danube: shall mean Danube Insurance Limited.<\/p>\n
DCEO: shall mean Du Pont Chemical and Energy Operations, Inc.,
\na Delaware corporation.<\/p>\n
DEC: shall mean Du Pont Energy Company, a Delaware
\ncorporation.<\/p>\n
Delayed Company: shall have the meaning set forth in Section
\n7.2(a).<\/p>\n
DERS: shall mean DuPont Environmental Remediation Services,
\nInc., a Delaware corporation.<\/p>\n
Dispute: shall have the meaning set forth in Section 13.1.<\/p>\n
DuPont: shall have the meaning set forth in the recitals.<\/p>\n
DuPont Action: shall have the meaning set forth in Section
\n7.10.<\/p>\n
DuPont Board: shall mean the Board of Directors of DuPont.<\/p>\n
DuPont Books and Records: shall mean the books and records (or
\ntrue and complete copies thereof), including all computerized books and records,
\nminute books, corporate charters and by-laws or comparable constitutive
\ndocuments, records of share issuances and related corporate records of or owned
\nby DuPont and its Subsidiaries (including Conoco and the Transferred Business
\nCompanies) other than the Conoco Books and Records. Notwithstanding the
\nforegoing, “DuPont Books and Records” shall not include any Tax Returns or other
\ninformation, documents or materials relating to Taxes.<\/p>\n
DuPont Business: shall mean the businesses in which, and the
\nactivities as to which, DuPont and its Subsidiaries, including Conoco and the<\/p>\n
8
\n 15
\nTransferred Business Companies, have been formerly or are currently engaged, but
\nexcluding the Conoco Business.<\/p>\n
DuPont Designees: shall have the meaning set forth in Section
\n5.3(b).<\/p>\n
DuPont Environmental Liability: shall have the meaning set
\nforth in Section 11.3.<\/p>\n
DuPont France: shall mean Du Pont de Nemours (France) S.A.<\/p>\n
DuPont Guarantee Amount: shall mean as of the Effective Date
\n$1,610,390,718, and thereafter, such amount as adjusted from time to time in the
\ngood faith judgment of the Chief Financial Officer or the Treasurer of DuPont,
\nafter consultation with, and effective upon written notice to, Conoco, to
\nreflect any increase or decrease in financial exposure of DuPont under the
\nDuPont Guarantees, the termination of DuPont Guarantees or the removal or
\nreplacement of DuPont’s obligations under the DuPont Guarantees; provided that
\nthe DuPont Guarantee Amount shall not be initially adjusted until the amount of
\nany such increase or decrease exceeds $50 million, and then adjusted to the full
\nextent of such amount, and thereafter, the DuPont Guarantee Amount shall only be
\nfurther adjusted when the amount of any additional increase or decrease is equal
\nto or greater than $50 million, or in the case of a decrease which reduces the
\nDuPont Guarantee Amount to zero.<\/p>\n
DuPont Guarantee Fee: shall have the meaning set forth in
\nSection 9.3(b).<\/p>\n
DuPont Guarantees: shall have the meaning set forth in Section
\n9.3(a).<\/p>\n
DuPont Hungary: shall mean DuPont Conoco Hungary Kft., a
\nHungarian corporation.<\/p>\n
DuPont Hungary Loan: shall mean the amounts owed as of the
\ndate hereof by DuPont Hungary to DuPont Engineering Products S.A.<\/p>\n
DuPont Italy: shall mean, collectively, Du Pont de Nemours
\nItaliana S.p.A. and Du Pont Conid S.p.A.<\/p>\n
9
\n 16
\n DuPont Master Note Agreement: shall mean the Note Agreement
\nbetween DuPont and CI, dated as of October 2, 1989, as the same may be amended
\nfrom time to time.<\/p>\n
DuPont Master Note: shall mean promissory notes evidencing
\nindebtedness of DuPont under the DuPont Master Note Agreement.<\/p>\n
DuPont Netherlands: shall mean DuPont de Nemours (Nederland)
\nB.V. and its Subsidiaries (other than Conoco CS Spol. s.r.o.)<\/p>\n
DuPont Party: shall have the meaning set forth in Section
\n6.2(b).<\/p>\n
DuPont Patents: shall mean (a) all U.S. and foreign patents,
\npatent applications and patent disclosures (including all reissues, divisions,
\ncontinuations, continuations-in-part, substitutions, extensions, or renewals of
\nany of the foregoing) owned by or under obligation of assignment to DuPont or
\nany Retained Subsidiary or with respect to which DuPont or any Retained
\nSubsidiary has the power to grant an immunity from suit for infringement, (b)
\nall U.S. and foreign patents, patent applications and patent disclosures
\n(including all reissues, divisions, continuations, continuations-in-part,
\nsubstitutions, extensions, or renewals of any of the foregoing) granted after
\nthe Effective Date by the applicable Governmental Authorities based on all
\napplications owned by or under obligations of assignment to DuPont or any
\nRetained Subsidiary or with respect to which DuPont or any Retained Subsidiary
\nhas the power to grant an immunity from suit for infringement, and (c) all U.S.
\nand foreign patent, patent application and patent disclosure (including all
\nreissues, divisions, continuations, continuations-in-part, substitutions,
\nextensions, or renewals of any of the foregoing) rights which are owned by or
\nunder obligation of assignment to DuPont or any Retained Subsidiary resulting
\nfrom Joint Invention Conceptions documented in invention disclosures as of the
\nEffective Date.<\/p>\n
DuPont Payables: shall have the meaning set forth in Section
\n9.1(b).<\/p>\n
DuPont Transferred Assets: shall mean (i) any and all Assets
\nowned by a Mixed-Use Subsidiary that are not primarily used in the Transferred
\nBusiness and (ii) the stock of any Subsidiary owned by a Transferred Business
\nCompany, which Subsidiary, after giving effect to the transfer, if any, of
\nTransferred Assets, would only be engaged in the Retained Business.<\/p>\n
10
\n 17
\n DTPA: shall have the meaning set forth in Section 14.13.<\/p>\n
Effective Date: shall mean the close of business on the date
\non which the first closing of the IPO occurs.<\/p>\n
Effective Time: shall mean the time on the Effective Date on
\nwhich the first closing of the IPO occurs.<\/p>\n
Employee Benefits Adjustment Amount: shall have the meaning
\nset forth in Section 2.5(c)<\/p>\n
Employee Benefits Note: shall have the meaning set forth in
\nSection 2.5(c).<\/p>\n
Employee Matters Agreement: shall mean the Employee Matters
\nAgreement between DuPont and Conoco dated the date hereof, substantially in the
\nform of Exhibit E hereto.<\/p>\n
Environment: shall mean any surface water, groundwater,
\ndrinking water supply, land surface or subsurface strata, or ambient air.<\/p>\n
Environmental Claim: shall mean any third party action,
\nlawsuit, claim or proceeding which seeks to impose Liability or injunctive
\nrelief for (i) noise, (ii) pollution or protection of the air, surface water,
\ngroundwater or land, (iii) solid, gaseous or liquid waste generation, treatment,
\nstorage, disposal or transportation, or (iv) damages to persons, property or
\nnatural resources resulting from a Release into the Environment of any Hazardous
\nSubstances.<\/p>\n
Environmental Permit: shall mean any permit, license, approval
\nor other authorization under any applicable Law, regulation and other
\nrequirement of any Governmental Authority relating to pollution or protection of
\nthe environment, including laws, regulations or other requirements relating to
\nemissions, discharges, releases or threatened releases of pollutants,
\ncontaminants, or hazardous or toxic materials or wastes into ambient air,
\nsurface water, ground water, or land, or otherwise relating to the manufacture,
\nprocessing, distribution, use, treatment, storage, disposal, transport, or
\nhandling of pollutants, contaminants or hazardous or toxic materials or wastes.<\/p>\n
11
\n 18
\n Equipment: shall mean all equipment, fixtures, physical
\nfacilities, tank batteries, surface and subsurface machinery, inventory, spare
\nparts, supplies, tools and other tangible personal property, including, without
\nlimitation, casing, tubing, tubular goods, rods, pumping units and engines,
\nderricks, platforms, separators, compressors, gathering lines, flow lines,
\ntanks, and communication systems and equipment.<\/p>\n
Excess Director Number: shall have the meaning set forth in
\nSection 5.3(d).<\/p>\n
Excess Proceeds: shall have the meaning set forth in Section
\n2.5(b).<\/p>\n
Excluded Assets: shall have the meaning set forth in Section
\n4.4.<\/p>\n
Final Determination: shall mean the final resolution of any
\nTax (or other Tax matter) for a taxable period, including related interest or
\npenalties, that, under applicable law, is not subject to further appeal, review
\nor modification through proceedings or otherwise, including (1) by the
\nexpiration of a statute of limitations or a period for the filing of claims for
\nrefunds, amending Tax Returns, appealing from adverse determinations, or
\nrecovering any refund (including by offset), (2) by a decision, judgment,
\ndecree, or other order by a court of competent jurisdiction, which has become
\nfinal and unappealable, (3) by a closing agreement or an accepted offer in
\ncompromise under Section 7121 or 7122 of the Code, or comparable agreements
\nunder laws of other jurisdictions, (4) by execution of an Internal Revenue
\nService Form 870 or 870AD, or by a comparable form under the laws of other
\njurisdictions (excluding, however, with respect to a particular Tax Item for a
\nparticular taxable period any such form that reserves (whether by its terms or
\nby operation of law) the right of the taxpayer to file a claim for refund and\/or
\nthe right of the Tax Authority to assert a further deficiency with respect to
\nsuch Tax Item for such period), or (5) by any allowance of a refund or credit,
\nbut only after the expiration of all periods during which such refund or credit
\nmay be recovered (including by way of offset).<\/p>\n
GAAP: shall mean generally accepted accounting principles of
\nthe United States as in effect from time to time.<\/p>\n
Governmental Authority: shall mean any nation or government,
\nany state, municipality or other political subdivision thereof and any entity,
\nagency, commission or court, whether domestic or foreign or multinational,
\nexercising<\/p>\n
12
\n 19
\nexecutive, legislative, judicial, regulatory or administrative functions of or
\npertaining to government and any executive official thereof.<\/p>\n
Hazardous Substance: shall mean any substance, whether solid,
\nliquid or gaseous, which is listed, defined or regulated as a “hazardous
\nsubstance”, “hazardous waste”, “solid waste”, “oils”, “pollutants”, or
\n“contaminants” or otherwise classified as hazardous or toxic, in or pursuant to
\nany Requirements of Environmental Law; or which is or contains asbestos, any
\npolychlorinated biphenyls, urea formaldehyde foam insulation, explosive or
\nradioactive material, or motor fuel or other petroleum hydrocarbons.<\/p>\n
Income Tax: shall mean (a) any Tax based upon, measured by, or
\ncalculated with respect to (1) net income or profits (including, without
\nlimitation, any capital gains Tax, minimum Tax and any Tax on items of Tax
\npreference, but not including sales, use, real or personal property, gross or
\nnet receipts, transfer or similar Taxes) or (2) multiple bases if one or more of
\nthe bases upon which such Tax may be based, measured by, or calculated with
\nrespect to, is described in clause (1) above, or (b) any United States state or
\nlocal franchise Tax.<\/p>\n
Indebtedness: of any Person shall mean, (a) all obligations of
\nsuch Person for borrowed money, including any Indebtedness under the Note or
\nwith respect to deposits or advances of any kind, (b) all obligations of such
\nPerson evidenced by bonds, debentures, notes or similar instruments, (c) all
\nobligations of such Person upon which interest charges are customarily paid, (d)
\nall obligations of such Person under conditional sale or other title retention
\nagreements relating to property or assets purchased by such Person, (e) all
\nobligations of such Person issued or assumed as the deferred purchase price of
\nproperty or services, (f) all Indebtedness of others secured by (or for which
\nthe holder of such Indebtedness has an existing right, contingent or otherwise,
\nto be secured by) any mortgage, lien, pledge, or other encumbrance on property
\nowned or acquired by such Person, whether or not the obligations secured thereby
\nhave been assumed, (g) all guarantees by such Person of Indebtedness of others
\nwhich in the aggregate exceed Two Billion Dollars ($2,000,000,000), (h) all
\ncapital lease obligations of such Person, and (i) all securities or other
\nsimilar instruments convertible or exchangeable into any of the foregoing, but
\nexcluding (1) industrial revenue bonds, (2) operating leases, (3) in the case of
\nCI, the Revolving Credit Facility and (4) daily cash overdrafts associated with
\nroutine cash operations.<\/p>\n
13
\n 20
\n Indemnifiable Loss Deduction: shall have the meaning set forth
\nin Section 6.2(e)(i).<\/p>\n
Indemnifying Party: shall mean any party who is required to
\npay any other person pursuant to this Agreement.<\/p>\n
Indemnitee: shall mean any party who is entitled to receive
\npayment from an Indemnifying Party pursuant to this Agreement.<\/p>\n
Indemnity Payment: shall mean the amount an Indemnifying Party
\nis required to pay to (or for the benefit of) an Indemnitee pursuant to this
\nAgreement.<\/p>\n
Information: shall have the meaning set forth in Section 8.2.<\/p>\n
Information Services Agreements: shall mean collectively, the
\nInformation Systems and Telecommunications Carrier Transitional Services
\nAgreement, the Information Systems Transitional Services Agreement, the
\nInformation Systems Side Letter Agreement, the Lease Agreement for office and
\ndata center space located in Ponca City, Oklahoma and the Lease Agreement for
\noffice and data center space located in Houston, Texas all of which are between
\nDuPont and Conoco, dated as of the date hereof substantially in the form of
\nExhibit I hereto.<\/p>\n
Intercompany Accounts: shall have the meaning set forth in
\nSection 9.1(d).<\/p>\n
Intercompany Agreement: shall mean any Contract between any
\nentities included within the Retained Business (including, without limitation,
\nDuPont and the Retained Subsidiaries), on the one hand, and any entities
\nincluded within the Transferred Business (including, without limitation, Conoco
\nand the Transferred Business Companies), on the other hand, entered into prior
\nto the Effective Date.<\/p>\n
Intercompany Loan: shall have the meaning set forth in Section
\n2.5(a).<\/p>\n
Interim Period: shall have the meaning set forth in Section
\n7.2(a).<\/p>\n
IPO: shall have the meaning set forth in the recitals.<\/p>\n
IPO Excess: shall have the meaning set forth in Section
\n2.5(b).<\/p>\n
14
\n 21
\n IRS: shall mean the Internal Revenue Service or any successor
\nagency or authority.<\/p>\n
Joint Invention Conceptions: shall mean, with respect to
\npatents, invention conceptions jointly developed by (a) DuPont and\/or any
\nRetained Subsidiary and (b) Conoco and\/or any Transferred Business Company.<\/p>\n
Law: shall mean any law, statute, ordinance, rule, regulation,
\norder, writ, judgment, injunction or decree of any Governmental Authority.<\/p>\n
Liabilities: shall mean any and all Indebtedness, liabilities
\nand obligations, whether accrued, fixed or contingent, mature or inchoate, known
\nor unknown, reflected on a balance sheet or otherwise, including, but not
\nlimited to, those arising under any law, rule, regulation, Action, order,
\ninjunction or consent decree of any Governmental Authority or any judgment of
\nany court of any kind or any award of any arbitrator of any kind, and those
\narising under any contract, commitment or undertaking.<\/p>\n
Losses: shall mean any and all damages, losses, deficiencies,
\nLiabilities, obligations, penalties, judgments, settlements, claims, payments,
\nfines, interest, costs and expenses (including, without limitation, the costs
\nand expenses of any and all Actions and demands, assessments, judgments,
\nsettlements and compromises relating thereto and the costs and expenses of
\nattorneys’, accountants’, consultants’ and other professionals’ fees and
\nexpenses incurred in the investigation or defense thereof or the enforcement of
\nrights hereunder), including direct and consequential damages, but excluding
\npunitive damages (other than punitive damages awarded to any third party against
\nan Indemnified Party).<\/p>\n
Mixed-Use Subsidiaries: shall mean those corporations,
\npartnerships, joint ventures, or other entities set forth on Schedule 1(a).<\/p>\n
Mont Belvieu Agreements: shall mean the Pipeline Operation
\nAgreement, the Ethane Storage and Throughput Agreement, the Ethylene Storage and
\nThroughput Agreement, the Emergency Call Transportation Service Agreement and
\nthe Purity Ethane Sales Agreement between DuPont and Conoco, dated the date
\nhereof, substantially in the forms included in Exhibit M hereto.<\/p>\n
15
\n 22
\n Natural Gas Supply Agreement: shall mean the Natural Gas
\nSupply Agreement between DuPont and Conoco, dated the date hereof, substantially
\nin the form of Exhibit H hereto.<\/p>\n
Net Proceeds: shall have the meaning set forth in Section
\n7.2(d).<\/p>\n
New Notes: shall have the meaning set forth in Section 2.5(c).<\/p>\n
Non-Permitted Names: shall have the meaning set forth in
\nSection 7.7.<\/p>\n
Note: shall mean the Promissory Note issued by CI to DEC,
\ndated as of July 20, 1998, in the principal amount of $7.5 Billion, a copy of
\nwhich is attached hereto as part of Exhibit D.<\/p>\n
Note Interest: shall have the meaning set forth in Section
\n2.5(b).<\/p>\n
NYSE: shall mean The New York Stock Exchange, Inc.<\/p>\n
Option Amount: shall mean the algebraic sum of (a) the Deemed
\nFuture Appreciation, (b) the After Tax Adjustment and (c) 50% of an amount equal
\nto the result obtained by subtracting the Intrinsic Value of Elected Options
\nfrom the Intrinsic Value of Non-Elected Options. For purposes of this
\ndefinition:<\/p>\n
“Active Conoco Employees” shall mean Conoco Employees eligible
\nto elect to cause the DuPont Stock Options and DuPont SARs held by such
\nemployees to be cancelled and to be granted options to acquire Newly Granted
\nOptions and Newly Granted SARs pursuant to Section 2.06 of the Employee Matters
\nAgreement;<\/p>\n
“After Tax Adjustment” shall mean an amount equal to 50% of
\n29% of the Intrinsic Value of all DuPont Stock Options held by Active Conoco
\nEmployees other than incentive stock options within the meaning Section 422 of
\nthe Code;<\/p>\n
“Deemed Future Appreciation” shall mean 32.25% of the average
\nprice of common stock of DuPont over the five trading days ending on the date on
\nwhich the initial offering price to the public of a share of common Stock of
\nConoco in the IPO is determined (calculated as the average of the mean of the
\nhigh and low prices on each of these five days as reported on the NYSE) (the
\n“DuPont Stock<\/p>\n
16
\n 23
\nPrice”) multiplied by the total number of shares of common stock of DuPont
\nsubject to Non-Elected Options;<\/p>\n
“Intrinsic Value” of Elected Options or Non-Elected Options,
\nas applicable, shall mean for each such option as to which the DuPont Stock
\nPrice exceeds the exercise price thereof, the product of (x) the number of
\nshares of common stock of DuPont subject to such option and (y) the DuPont Stock
\nPrice less the exercise or base price of such option;<\/p>\n
“Elected Options” shall mean DuPont Stock Options and DuPont
\nSARs (excluding Conoco Key Unit Options) outstanding as of the close of business
\non October 19, 1998, determined pursuant to the records of the relevant plan
\nadministrator, held by Active Conoco Employees as to which such employees have
\nelected to cause such DuPont Stock Options and DuPont SARs to be cancelled and
\nto be granted options to acquire Newly Granted Options and Newly Granted SARs
\npursuant to Section 2.06 of the Employee Matters Agreement; and<\/p>\n
“Non-Elected Options” shall mean DuPont Stock Options and
\nDuPont SARs outstanding as of the close of business on October 19, 1998,
\ndetermined pursuant to the records of the relevant plan administrator, held by
\nActive Conoco Employees as to which such employees have not elected to cause
\nsuch DuPont Stock Options and DuPont SARs to be cancelled and to be granted
\noptions to acquire Newly Granted Options and Newly Granted SARs pursuant to
\nSection 2.06 of the Employee Matters Agreement.<\/p>\n
All other capitalized terms used in this definition, but not
\ndefined in this definition shall have the meanings ascribed to such terms in the
\nEmployee Matters Agreement.<\/p>\n
Outside Date: shall have the meaning set forth in Section
\n2.5(b).<\/p>\n
Outstanding Check Amount: shall have the meaning set forth in
\nSection 9.1(c).<\/p>\n
Person: shall mean any natural person, firm, individual,
\ncorporation, partnership, limited liability company, limited liability
\npartnership, joint venture, business trust, association, trust, company or other
\norganization or entity, whether incorporated or unincorporated, or any
\nGovernmental Authority.<\/p>\n
17
\n 24
\n Petrozuata: shall mean Petrolera Zuata, Petrozuata C.A., a
\nVenezuelan compania anonima in which Conoco owns an indirect non-controlling
\n50.1 percent equity interest.<\/p>\n
Pitt-Consol: shall mean Pitt-Consol Chemical Company, a New
\nJersey corporation.<\/p>\n
Pocahontas Partnership: shall mean the Pocahontas Gas
\nPartnership, a Virginia general partnership.<\/p>\n
Principal Related Agreements: shall have the meaning set forth
\nin the definition of Related Agreements.<\/p>\n
Privilege: shall have the meaning set forth in Section 8.6(a).<\/p>\n
Privileged Information: shall have the meaning set forth in
\nSection 8.6(a).<\/p>\n
Registration Rights Agreement: shall mean the Registration
\nRights Agreement between DuPont and Conoco, dated the date hereof, substantially
\nin the form of Exhibit K hereto.<\/p>\n
Registration Statement: shall have the meaning set forth in
\nSection 2.6(a).<\/p>\n
Related Agreements: shall mean, collectively, the Employee
\nMatters Agreement, the several Transitional Services Agreements, the Tax Sharing
\nAgreement, the Natural Gas Supply Agreement, the Registration Rights Agreement,
\nthe Motor Carrier Contract, the Note and the Conoco Guarantee, the Employee
\nBenefits Note and the associated guarantee by Conoco, the Revolving Credit
\nFacility and the related guarantee of CI’s obligations thereunder by Conoco, the
\nInformation Services Agreements, the Mont Belvieu Agreements, the Engineering
\nand SHE Standards and Guidelines License Agreement, the UPbase(TM) System
\nSoftware License Agreement and the DME Tolling Agreement (the foregoing
\nagreements, collectively, the “Principal Related Agreements”), and all other
\nagreements to be entered into between DuPont and the Retained Subsidiaries, on
\nthe one hand, and Conoco and its Subsidiaries, on the other hand, in connection
\nwith the Restructuring, the Separation and the consummation of the transactions
\ncontemplated hereby or which relate to the<\/p>\n
18
\n 25
\nongoing relationship between Conoco and its Subsidiaries on the one hand, and
\nDuPont and the Retained Subsidiaries, on the other hand.<\/p>\n
Release: shall mean any release, spill, emission, discharge,
\nleaking, pumping, injection, deposit, disposal, discharge, dispersal, leaching
\nor migration into the indoor or outdoor Environment or into or out of any
\nproperty.<\/p>\n
Representative: shall mean, with respect to any Person, each
\nof such Person’s directors, officers, employees, representatives, attorneys,
\naccountants, advisors and agents, and each of the heirs, executors and assigns
\nof any of the foregoing.<\/p>\n
Requirements of Environmental Law: shall mean all requirements
\nof environmental or ecological laws or regulations, including all requirements
\nimposed by any law, rule or regulation of any Governmental Authority at any time
\nin effect which relate to (i) noise, (ii) pollution or protection of the air,
\nsurface water, groundwater or land, (iii) solid, gaseous or liquid waste
\ngeneration, treatment, storage, disposal or transportation, or (iv) employee
\nhealth and safety.<\/p>\n
Restated Tax Saving Amount: shall have the meaning set forth
\nin Section 6.2(e)(ii).<\/p>\n
Restructured Notes: shall have the meaning set forth in
\nSection 2.5(b).<\/p>\n
Restructuring: shall have the meaning set forth in Section
\n2.1.<\/p>\n
Retained Business: shall mean the businesses in which, and the
\nactivities as to which, DuPont and its Subsidiaries, including Conoco and its
\nSubsidiaries, are currently engaged, but excluding in any event the Transferred
\nBusiness. The “Retained Business” shall include (i) CONSOL Energy and its
\ncontrolled affiliates and joint ventures in which it is a participant (other
\nthan through CI’s interest in the Pocahontas Partnership), (ii) Pitt-Consol,
\n(iii) Sentinel and (iv) DuPont Netherlands.<\/p>\n
Retained Environmental Assets: shall have the meaning set
\nforth in Section 11.1(b).<\/p>\n
Retained Liabilities: shall have the meaning set forth in
\nSection 4.2.<\/p>\n
19
\n 26
\n Retained Subsidiary: shall mean any Subsidiary of DuPont at
\nany time after the date of this Agreement, including DuPont Netherlands, but
\nexcluding Conoco and the Transferred Business Companies.<\/p>\n
Revolving Credit Facility: shall mean a revolving credit
\nfacility provided to CI by DEC providing for borrowings in an aggregate
\nprincipal amount not to exceed $500 million at any one time outstanding.<\/p>\n
Risk Manager: shall have the meaning set forth in Section
\n10.2.<\/p>\n
Ruling: shall have the meaning set forth in Section 5.6(b)<\/p>\n
SEC: shall mean the U.S. Securities and Exchange Commission.<\/p>\n
Securities Act: shall mean the Securities Act of 1933, as
\namended.<\/p>\n
Senior Executive: shall mean the Chief Executive Officer,
\nChief Financial Officer or General Counsel of DuPont or Conoco, as applicable.<\/p>\n
Sentinel: shall mean Sentinel Transportation Company, a
\nDelaware corporation.<\/p>\n
Separation: shall have the meaning set forth in the recitals.<\/p>\n
Separation Expenses: shall mean (a) those expenses to be paid
\nby DuPont pursuant to Section 6(f) of the underwriting agreement to be entered
\ninto in connection with the IPO and (b) those expenses, incurred and paid
\nbetween May 11, 1998 and 24 months following the date on which DuPont’s voting
\npower falls below 50% of the voting power of all of the outstanding shares of
\nVoting Stock of Conoco, incurred with third parties, on a non recurring basis
\ndirectly as result of the IPO, the Restructuring, the Separation or any
\ntransaction subsequent to the IPO (including a series of related transactions)
\nresulting in a reduction in the number of shares of Voting Stock beneficially
\nowned by DuPont, provided that prior to any such subsequent transaction the
\nvoting power of the shares of Voting Stock beneficially owned by DuPont is not
\nless than 50% of the voting power of all of the then outstanding shares of
\nVoting Stock. Notwithstanding anything to the contrary in this Agreement, (i)
\nexpenses that benefit future operations of the Transferred Business will not be
\nSeparation Expenses; (ii) Separation Expenses must be out-of-pocket expenditures
\nwhich meet accounting guidelines for both discontinued operations under APB 30<\/p>\n
20
\n 27
\nand for gain\/loss accounting treatment and shall specifically exclude accruals
\n(provided that expenses that would otherwise have qualified as Separation
\nExpenses but which have been accrued shall be deemed Separation Expenses once
\nsuch expenses have been paid and provided further that Separation Expenses shall
\nnot include any costs and expenses associated with pension plans or severance
\nowed to employees which are exclusively provided for in the Employee Matters
\nAgreement); (iii) in the event that the parties disagree as to whether an
\nexpense meets accounting guidelines for both discontinued operations under APB
\n30 and for gain\/loss accounting treatment or otherwise qualifies generally as a
\nSeparation Expense under this definition and therefore qualifies for
\nreimbursement by DuPont pursuant to this Agreement, DuPont’s good faith decision
\nshall be final; (iv) any increased costs associated with a contract as to which
\nthird party consent was obtained with respect to the Separation (other than
\nnonrecurring breakage and similar fees and incidental expenses paid in order to
\nobtain such consents) will not be Separation Expenses, (v) amounts paid pursuant
\nto the indemnification and contribution provisions of this Agreement and the
\nRelated Agreements will not be Separation Expenses, (vi) expenses that are not
\nincurred and paid prior to or on the date which is twenty four months from the
\ndate on which DuPont’s voting power falls below 50% of the voting power of all
\nof the outstanding shares of Voting Stock of Conoco shall not be Separation
\nExpenses and (vii) Separation Expenses, shall not include costs and expenses
\nrelated to information technology which will be governed exclusively by the
\nInformation Services Agreements.<\/p>\n
Shared Contracts: shall mean Contracts with third parties
\nwhich directly benefit both DuPont or a Retained Subsidiary and Conoco or one of
\nits Subsidiaries.<\/p>\n
Shared Contractual Liabilities: shall mean Liabilities in
\nrespect of Shared Contracts.<\/p>\n
Subsidiary: shall mean (a) a corporation, at least a majority
\nof the voting or capital stock of which is as of the time in question directly
\nor indirectly owned by such party and (b) any other partnership, joint venture,
\nassociation, joint stock company, trust, unincorporated organization or other
\nentity, in which such party, directly or indirectly, owns a majority of the
\nequity interest thereof or has the power to elect or direct the election of at
\nleast a majority of the members of the governing body of such entity or
\notherwise has control over such entity (e.g., as the managing partner of a
\npartnership).<\/p>\n
21
\n 28
\n Target Cash Amount: shall mean $225 million of cash and cash
\nequivalents (in United States Dollars or an equivalent amount in foreign
\ncurrency, determined using the exchange rates quoted in the Financial Times two
\nbusiness days prior to the Cash Settlement Date), excluding from the foregoing
\n$225 million amount (i) $70 million (which shall consist of (A) any certificates
\nof deposit held by Danube, valued at their face amounts, and (B) to the extent
\nin excess of the amount set forth in clause (A) above, other forms of cash and
\ncash equivalents held by Danube and its subsidiaries whether or not
\ncharacterized or classified as such by GAAP); and (ii) the amounts of unearned
\npremiums and loss reserves required by Section 10.3 to be ceded by Danube to
\nChristiana pursuant to Section 10.3 to the extent such amounts have not been
\npaid by Danube to Christiana as of the Cash Settlement Date.<\/p>\n
Tax or Taxes: shall mean any charges, fees, levies, imposts,
\nduties, or other assessments of a similar nature, including income, alternative
\nor add-on minimum, gross receipts, profits, lease, service, service use, wage,
\nwage withholding, employment, workers compensation, business occupation,
\noccupation, premiums, environmental, excise, employment, sales, use, transfer,
\nlicense, payroll, franchise, severance, stamp, occupation, windfall profits,
\nwithholding, social security, unemployment, disability, ad valorem, estimated,
\nhighway use, commercial rent, capital stock, paid up capital, recording,
\nregistration, property, real property gains, value added, business license,
\ncustom duties, or other tax or governmental fee of any kind whatsoever, imposed
\nor required to be withheld by any Tax Authority including any interest,
\nadditions to tax, or penalties applicable or related thereto.<\/p>\n
Tax Authority: shall mean a governmental authority or any
\nsubdivision, agency, commission or authority thereof or any quasi-governmental
\nor private body having jurisdiction over the assessment, determination,
\ncollection or imposition of any Tax (including, without limitation, the IRS).<\/p>\n
Tax Item: shall mean any item of income, gain, loss, deduction
\nor credit, or other attribute that may have the effect of increasing or
\ndecreasing any Tax.<\/p>\n
Tax Returns: shall mean any return, report, certificate, form
\nor similar statement or document (including, any related or supporting
\ninformation or schedule attached thereto and any information return, amended tax
\nreturn, claim for refund or declaration of estimated tax) required to be
\nsupplied to, or filed with, a Tax Authority in connection with the
\ndetermination, assessment or collection of any Tax<\/p>\n
22
\n 29
\nor the administration of any laws, regulations or administrative requirements
\nrelating to any Tax.<\/p>\n
Tax Saving Amount: shall have the meaning set forth in Section
\n6.2(e)(i).<\/p>\n
Tax Sharing Agreement: shall mean the Tax Sharing Agreement
\nbetween DuPont and Conoco, dated the date hereof, substantially in the form of
\nExhibit G hereto.<\/p>\n
Third Party Claim: shall have the meaning set forth in Section
\n6.3(a).<\/p>\n
Third Party Sites: shall have the meaning set forth in Section
\n11.4.<\/p>\n
Tie-In Limit Loss: shall have the meaning set forth in Section
\n10.4(b).<\/p>\n
Transferred Assets: shall have the meaning set forth in
\nSection 4.3.<\/p>\n
Transferred Business: shall mean the businesses and activities
\ncurrently conducted by Conoco, its Subsidiaries and other Transferred Business
\nCompanies described in the narrative portion of the section entitled “Business”
\nin the Registration Statement, but excluding (i) by CONSOL Energy and its
\ncontrolled affiliates and joint ventures in which it is a participant (other
\nthan through CI’s interest in the Pocahontas Partnership) and Pitt-Consol, (ii)
\nby DuPont Netherlands, (iii) by Sentinel, (iv) in the United States by DuPont
\nand its Subsidiaries (other than Conoco and its Subsidiaries) and (v) outside of
\nthe United States by DuPont and its Subsidiaries of the same general type and
\nnature as the businesses and activities referred to in clause (iv) above.<\/p>\n
Transferred Business Companies: shall mean those corporations,
\npartnerships, joint ventures, or other entities each of which currently conducts
\nthe Transferred Business which are set forth on Schedule 1(b).<\/p>\n
Transferred Employees: shall mean (a) those persons who are
\nemployed as officers or employees of the Transferred Business immediately prior
\nto or effective as of the Effective Date and (b) all former officers and
\nemployees of the Transferred Business who, immediately prior to the termination
\nof their employment, were employed in the Transferred Business. In the event
\nthat on the Effective Date<\/p>\n
23
\n 30
\n(or if such person is no longer employed as of the Effective Date, then as of
\nthe last date of such person’s employment) any person was or shall be employed
\nin the Transferred Business, as well as in the Retained Business, such person
\nshall be considered a Transferred Employee if, but only if, on the Effective
\nDate (or if such person is no longer employed as of the Effective Date, then as
\nof the last date of such person’s employment) such person’s primary employment
\nwas or shall be in the Transferred Business.<\/p>\n
Transferred Environmental Asset: shall have the meaning set
\nforth in Section 11.1(a).<\/p>\n
Transitional Services Agreements: shall mean the several
\nTransitional Services Agreements between DuPont and\/or any of the Retained
\nSubsidiaries on the one hand, and Conoco, and\/or any of its Subsidiaries, on the
\nother hand, dated the date hereof, substantially in the form of Exhibit F
\nhereto.<\/p>\n
Vista Chemical: shall mean CONDEA Vista Company (formerly
\nnamed Vista Chemical Company), a Delaware corporation.<\/p>\n
Voting Stock: shall mean the Class A Common Stock, the Class B
\nCommon Stock and any other capital stock of Conoco entitled to vote generally in
\nthe election of directors but excluding any class or series of capital stock
\nonly entitled to vote in the event of dividend arrearages thereon, whether or
\nnot at the time of determination there are any such dividend arrearages.<\/p>\n
WARN Act: shall have the meaning set forth in Section 7.9.<\/p>\n
Waste Site: shall mean any well, pit, pond, lagoon,
\nimpoundment, ditch, landfill, waste storage container, site or area where waste
\nmaterials or Hazardous Substances have been Released, deposited, stored,
\ndisposed of, placed or otherwise come to be located.<\/p>\n
ARTICLE II<\/p>\n
RESTRUCTURING AND RELATED TRANSACTIONS<\/p>\n
Section 2.1 The Restructuring. Subject to the terms and
\nconditions of this Agreement, DuPont and Conoco shall use, and shall cause their
\nrespective<\/p>\n
24
\n 31
\nSubsidiaries to use, their respective reasonable commercial efforts to
\nconsummate, on or prior to the Effective Date, the transactions heretofore
\ndocumented and agreed to by the parties hereto as constituting the restructuring
\n(the “Restructuring”). It is the intent of the parties that after consummation
\nof the Restructuring, subject to receipt of all approvals required of any
\nGovernmental Authority or any third party as set forth more fully in Sections
\n7.1 and 7.2 hereof, (i) the Transferred Business Companies will all be owned,
\ndirectly or indirectly, by Conoco and the Transferred Business will be conducted
\nentirely by Conoco and its Subsidiaries, (ii) Conoco or one of the Transferred
\nBusiness Companies will own all of the Transferred Assets, (iii) Conoco or one
\nor more of the Transferred Business Companies will, to the extent not previously
\nliable therefor, have assumed and be liable for all of the Assumed Liabilities,
\n(iv) the Retained Business will be conducted entirely by DuPont and the Retained
\nSubsidiaries, (v) DuPont or one of the Retained Subsidiaries will own all of the
\nDuPont Transferred Assets and the Excluded Assets and (vi) DuPont or one of the
\nRetained Subsidiaries will, to the extent not previously liable therefor, have
\nassumed and be liable for all of the Retained Liabilities.<\/p>\n
Section 2.2 Transfers of Assets.<\/p>\n
(a) Prior to or for one year following the Effective
\nDate, if DuPont or Conoco, as the case may be, identifies any Asset, other than
\nShared Contracts, owned by one of the Mixed-Use Subsidiaries which (i) at such
\ntime and for the prior 12 month period was used primarily in the Transferred
\nBusiness and is then owned by DuPont or one of the Retained Subsidiaries or (ii)
\nat such time and for the prior 12 month period was used primarily in the
\nRetained Business or is an Excluded Asset and is then owned by Conoco or one of
\nthe Transferred Business Companies, DuPont or Conoco, as the case may be, shall
\nor shall cause any such Asset to be conveyed, assigned, transferred and
\ndelivered in accordance with Section 2.3 to the entity identified by DuPont or
\nConoco, as the case may be, as the appropriate transferee.<\/p>\n
(b) For one year following the Effective Date, if
\nDuPont or Conoco, as the case may be, identifies any Asset (other than any stock
\nor other equity interest in a Delayed Company) then owned by either DuPont or
\nany of the Retained Subsidiaries, on the one hand, or Conoco or any of the
\nTransferred Business Companies, on the other hand, that, both DuPont and Conoco
\neach agree in their good faith judgment more properly belongs to the other
\nparty, or a Subsidiary of the other party, then DuPont or Conoco, as the case
\nmay be, shall convey, assign, transfer and deliver or shall cause any such Asset
\nto be conveyed, assigned, transferred and delivered in<\/p>\n
25
\n 32
\naccordance with Section 2.3 to the entity identified by Conoco or DuPont, as the
\ncase may be, as the appropriate transferee; provided, however, that the
\nforegoing shall not apply to the sale or transfer of any stock of, equity
\ninterests in, or Assets of DuPont Netherlands, which sales or transfers, if any,
\nshall be at fair market value (it being agreed that the parties have no
\nobligations or agreement as to any such sale or transfer).<\/p>\n
(c) As soon as is reasonably practicable following
\nthe Effective Date, DuPont shall, or shall cause the appropriate Retained
\nSubsidiary to convey, assign, transfer and deliver in accordance with Section
\n2.3 the Assets listed on Schedule 1(c) to the entity identified by Conoco as the
\nappropriate transferee.<\/p>\n
(d) The parties hereto acknowledge and agree that
\nexcept for transfers pursuant to the Restructuring, any transfers occurring more
\nthan one year following the Effective Date, and the transfer of the equity
\ninterests in DuPont Netherlands, if any, the transfers of Assets provided for in
\nthis Agreement are to be made without any additional consideration other than
\nthe assumption of Liabilities by the transferee.<\/p>\n
(e) All conveyances, assignments, transfers and
\ndeliveries of Assets occurring after the Effective Date pursuant to this Section
\n2.2 shall be governed by the terms of this Agreement. In furtherance of the
\nforegoing, any Asset transferred pursuant to this Section 2.2 to Conoco or one
\nof the Transferred Business Companies shall be deemed a Transferred Asset and
\nany Asset transferred to DuPont or one of the Retained Subsidiaries shall be
\ndeemed a DuPont Transferred Asset for all purposes of this Agreement and the
\nRelated Agreements.<\/p>\n
Section 2.3 Methods of Transfer and Assumption. The parties
\nhereto agree that (a) required transfers of Transferred Assets (other than, in
\ngeneral, Assets owned by Transferred Business Companies which are not Mixed-Use
\nSubsidiaries) and DuPont Transferred Assets shall be effected by delivery by
\nDuPont or one of the Retained Subsidiaries to Conoco or to one of the
\nTransferred Business Companies, or by Conoco or one of the Transferred Business
\nCompanies to DuPont or to one of the Retained Subsidiaries, as the case may be,
\nof (i) with respect to those Assets which are evidenced by capital stock
\ncertificates or similar instruments, certificates duly endorsed in blank or
\naccompanied by stock powers or other instruments of assignment executed in
\nblank, (ii) with respect to any real property interest or any improvements
\nthereon owned by a Mixed-Use Subsidiary, a deed without any<\/p>\n
26
\n 33
\nwarranty as to title of the transferor (or any of its Affiliates) and without
\nany covenant covering transferor’s (or any of its Affiliate’s) acts or the
\nequivalent thereof in accordance with local practice, and (iii) with respect to
\nall other Assets owned by a Mixed-Use Subsidiary, such good and sufficient
\ninstruments of contribution, conveyance, assignment and transfer, in form and
\nsubstance reasonably satisfactory to DuPont and Conoco, as shall be necessary to
\nvest in DuPont, Conoco or their respective Subsidiaries, as the case may be, all
\nof the title and ownership interest of DuPont, Conoco or their respective
\nSubsidiaries, as the case may be, in and to any such Asset, (b) to the extent
\nnecessary, the assumption of the Retained Liabilities contemplated pursuant to
\nSection 3.2 hereof shall be effected by delivery by DuPont or the applicable
\nRetained Subsidiaries, as the case may be, to Conoco or the applicable
\nTransferred Business Companies of such good and sufficient instruments of
\nassumption, in form and substance reasonably satisfactory to DuPont and Conoco,
\nas shall be necessary for the assumption by DuPont or the Retained Subsidiaries
\nof the Retained Liabilities, and (c) to the extent necessary, the assumption of
\nthe Assumed Liabilities contemplated pursuant to Section 3.1 hereof shall be
\neffected by delivery by Conoco or the Transferred Business Companies, as the
\ncase may be, to DuPont or the applicable Retained Subsidiaries, as the case may
\nbe, of such good and sufficient instruments of assumption, in form and substance
\nreasonably satisfactory to DuPont and Conoco, as shall be necessary for the
\nassumption by Conoco or the Transferred Business Companies of the Assumed
\nLiabilities. Each of the parties hereto also agrees to deliver to any other
\nparty hereto such other documents, instruments and writings as may be reasonably
\nrequested by such other parties hereto in connection with the transactions
\ncontemplated hereby. Notwithstanding any other provisions of this Agreement to
\nthe contrary, (x) THE TRANSFERS AND ASSUMPTIONS REFERRED TO IN THIS SECTION 2.3
\nAND THE SEPARATION OF THE TRANSFERRED BUSINESS FROM THE RETAINED BUSINESS ARE
\nBEING MADE WITHOUT ANY REPRESENTATION OR WARRANTY OF ANY NATURE (a) AS TO THE
\nVALUE OR FREEDOM FROM ENCUMBRANCE OF, ANY ASSETS, (b) AS TO ANY WARRANTY OF
\nMERCHANTABILITY OR WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE OF, OR ANY OTHER
\nMATTER CONCERNING, ANY ASSETS OR (c) AS TO THE LEGAL SUFFICIENCY TO CONVEY TITLE
\nTO ANY ASSETS, and (y) the instruments of transfer or assumption referred to in
\nthis Section 2.3 shall not include any separate representations and warranties.
\nDuPont and Conoco hereby acknowledge and agree that ALL ASSETS ARE BEING
\nTRANSFERRED “AS IS, WHERE IS.” Conoco shall bear the economic and legal risks
\nthat any conveyances of the Transferred Assets to Conoco or one of its
\nSubsidiaries by DuPont or one of the Retained Subsidiaries shall prove to be
\ninsufficient or that Conoco’s or any Transferred<\/p>\n
27
\n 34
\nBusiness Company’s title to any of the Transferred Assets which they currently
\nown (or, after giving effect to the Restructuring and the transfers contemplated
\nby this Agreement, will own) shall be other than good and marketable and free
\nfrom encumbrances, and DuPont shall bear the economic and legal risks that any
\nconveyances of DuPont Transferred Assets to DuPont or one of the Retained
\nSubsidiaries by Conoco or one of its Subsidiaries shall prove to be insufficient
\nor that DuPont’s or any Retained Subsidiaries’ title to any of the DuPont
\nTransferred Assets shall be other than good and marketable and free from
\nencumbrances. DuPont and Conoco hereby further acknowledge and agree that in the
\nevent and to the extent that there is any conflict between the provisions of
\nthis Agreement and the provisions of any of the instruments of transfer or
\nassumption referred to in this Section 2.3, the provisions of this Agreement
\nshall control except where a specific conveyancing instrument (i) specifically
\n(A) provides that such instrument shall control over this Section 2.3 and (B)
\nrefers to this specific Section 2.3 by number and (ii) has been approved in
\nwriting by the General Counsel or an Associate General Counsel of each of DuPont
\nand Conoco.<\/p>\n
Section 2.4 Organization of Registrant; Execution of Related
\nAgreements.<\/p>\n
(a) Prior to the Effective Time, Conoco shall take,
\nand DuPont shall take, and as the indirect sole stockholder of Conoco, approve
\nor ratify, or cause to be approved or ratified, any and all actions that are
\nreasonably necessary or desirable to be taken by DuPont or Conoco to effectuate
\nthe transactions contemplated by this Section 2.4 and Section 2.5 in a manner
\nconsistent with the terms of this Agreement, including, without limitation, the
\nfollowing: (i) amending the Certificate of Incorporation of Conoco so that the
\nprovisions thereof at the Effective Time shall be the provisions set forth on
\nExhibit A attached hereto; (ii) amending the By-Laws of Conoco so that the
\nprovisions thereof at the Effective Time shall be the provisions set forth on
\nExhibit B attached hereto; (iii) entering into, as of the Effective Time, a
\nshareholder rights agreement between Conoco and the rights agent set forth
\ntherein having substantially the same provisions, with such changes thereto as
\nDuPont and Conoco may approve, as those set forth on Exhibit C attached hereto
\n(the “Conoco Rights Plan”); (iv) adopting, preparing and implementing
\nappropriate plans, agreements and arrangements for employees of Conoco and
\nnon-employee directors of Conoco (including, without limitation, the employee
\nbenefit plans, agreements and arrangements to be established pursuant to the
\nEmployee Matters Agreement (with such changes thereto as DuPont may approve in
\nits sole discretion)); and (v) electing or otherwise appointing those
\nindividuals designated in the<\/p>\n
28
\n 35
\nRegistration Statement to be directors or officers of Conoco, effective as of or
\nprior to the Effective Date, except for those to be elected or appointed
\nthereafter.<\/p>\n
(b) On or prior to the Effective Date, DuPont and
\nConoco shall enter into the Principal Related Agreements, each of which shall be
\neffective as of the Effective Time, unless otherwise specified therein.<\/p>\n
Section 2.5 The Intercompany Notes.<\/p>\n
(a) Prior to the Effective Time, DuPont and Conoco
\nshall, and shall cause their respective Subsidiaries to take all actions
\nnecessary or advisable to restructure the existing loans between DuPont and the
\nRetained Subsidiaries, on the one hand, and Conoco and its Subsidiaries, on the
\nother hand (the “Intercompany Loans”) such that following such restructuring,
\nthe only remaining Intercompany Loans shall be represented by the Note, the
\nDuPont Master Note, the Conoco Master Note, the Revolving Credit Agreement and
\nthe Restructured Notes (as defined below).<\/p>\n
(b) Immediately following the closing of the IPO,
\nConoco shall lend or contribute out of the gross proceeds of the IPO received by
\nConoco (net of underwriting discounts and commissions) an amount equal to the
\naccrued and unpaid interest on the Note as of the Effective Date (the “Note
\nInterest”) plus $2.654 billion (or such lesser amount as constitutes all of the
\ngross proceeds net of the expenses set forth in the preceding parenthetical and
\nthe Note Interest) to CI and Conoco shall immediately thereafter cause CI to
\nfirst, pay the Note Interest to DEC and second, to pay the remainder of such
\n$2.654 billion (or lesser) amount to DEC in partial satisfaction of its
\nobligations under the Note, to repay, in part, principal under the Note. To the
\nextent less than an amount equal to the Note Interest plus $2.654 billion has
\nbeen paid pursuant to the preceding sentence, upon the closing of the exercise
\nof the underwriters’ over-allotment option of the IPO, the proceeds of such
\nexercise shall be applied in a like manner to the extent necessary to pay the
\nbalance of such amount. To the extent the gross proceeds of the IPO (net of
\nunderwriting discounts and commissions and other offering expenses not
\ntheretofore paid) received by Conoco including upon exercise of the
\nunderwriters’ over-allotment option exceed an amount equal to the Note Interest
\nplus $2.654 billion (such excess, being referred to herein, as the “Excess
\nProceeds”), Conoco shall (x) first purchase from the holder or holders thereof,
\nin whole or in part, at the face amount thereof plus accrued interest thereon,
\nthe promissory notes of Norske Conoco A\/S, payable to the order of DCEO, in the
\naggregate principal amount of 3,403,000,000 Norwe-<\/p>\n
29
\n 36
\ngian Kroner, (y) second (to the extent sufficient funds remain out of the Excess
\nProceeds) repay to the holder or holders thereof, in whole or in part, the
\npromissory note, dated as of August 31, 1998, of Conoco, payable to the order of
\nDCEO, in the principal amount of $827,447,710.83 plus accrued interest thereon,
\n(such note, together with the notes for 3,403,000,000 Norwegian Kroner described
\nabove, the “Restructured Notes”) and (z) thereafter (to the extent sufficient
\nfunds remain out of the Excess Proceeds and in no event prior to the Cash
\nSettlement Date) contribute funds to CI and cause CI to repay to the holder or
\nthe holders thereof, in whole or in part, amounts outstanding under the Conoco
\nMaster Note, plus accrued interest thereon; provided, however, the aggregate
\ncash used to repay or repurchase the Restructured Notes and the Conoco Master
\nNote pursuant to the foregoing shall equal the lesser of (1) the Excess Proceeds
\nand (2) the aggregate face amount of the Restructured Notes plus accrued
\ninterest thereon and the Conoco Master Note plus accrued interest thereon.
\nPromptly following such repayment and\/or purchase and following any cash payment
\npursuant to Section 9.1 below, DuPont shall, or shall cause the Retained
\nSubsidiaries to contribute the Restructured Notes and the Conoco Master Note
\n(excluding any portion of the Restructured Notes or the Conoco Master Note that
\nDuPont determines to maintain outstanding in accordance with Section 2.5(c)) to
\nConoco, to the extent not previously purchased by Conoco or repaid in full;
\nprovided that DuPont may delay such contribution of all or part of the
\nRestructured Notes and the Conoco Master Note until the date (the “Outside
\nDate”) that is 5 business days following the later of the Cash Settlement Date
\nand the date of receipt by Conoco of the proceeds of the sale of stock of Conoco
\npursuant to the underwriters’ over-allotment option in the IPO. In the event the
\nExcess Proceeds exceeds the amount set forth in clause (2) of the second
\npreceding sentence (such excess being called the “IPO Excess”), Conoco shall, if
\nand to the extent requested by DuPont (and DuPont shall have until the Outside
\nDate to so request) use all or a portion of the IPO Excess to pay accrued
\ninterest and principal on the Note.<\/p>\n
(c) If the sum of the Option Amount and $10.4 million
\n(such sum, the “Employee Benefits Adjustment Amount”) is positive, Conoco shall,
\nif and at such time as requested by DuPont, but no later than the later of the
\nOutside Date and 30 days following the Effective Date, cause CI to deliver a
\npromissory note, substantially in the form attached hereto as Exhibit L, to DEC
\nin an amount equal to the Employee Benefits Adjustment Amount (the “Employee
\nBenefits Note”, and, together with the Note, the “New Notes”). If the Employee
\nBenefits Adjustment Amount is negative, DuPont shall instead pay to Conoco an
\namount in cash equal to the absolute value of the Employee Benefits Adjustment
\nAmount 30 days following the Effective Date. To the extent that any portion of
\nthe Restructured Note of<\/p>\n
30
\n 37
\nConoco to DCEO in the principal amount of $827,447,710.83 or the Conoco Master
\nNote would otherwise be contributed to Conoco pursuant to Section 2.5(b), DuPont
\nmay maintain outstanding, in lieu of receiving all or a portion of the Employee
\nBenefits Note in accordance with the first sentence of this Section 2.5(c), all
\nor a portion of such remaining principal balance of such Restructured Note or
\nthe Conoco Master Note in an amount not to exceed 94% of the principal amount of
\nthe Employee Benefits Note that would otherwise be delivered in accordance with
\nthe first sentence of this Section 2.5(c) and being so replaced. To the extent
\nthat only a portion of, but not the entire, Employee Benefits Note is to be
\nreplaced by all or a portion of the aforesaid Restructured Note or the Conoco
\nMaster Note (such portion being deemed to be a “New Note”), Conoco shall deliver
\nthe Employee Benefits Note in accordance with the first sentence of this Section
\n2.5(c), but in a principal amount equal to the (A) Employee Benefits Adjustment
\nAmount minus (B) 100% (and not 94%) of the principal amount of the portion of
\nthe Employee Benefits Note so replaced.<\/p>\n
(d) Following the Effective Date and until all
\nprincipal and accrued interest due under the New Notes shall have been paid in
\nfull, on the first business day after the date of the receipt thereof by Conoco
\nor any of its Subsidiaries, Conoco shall, or shall cause its relevant Subsidiary
\nto, lend or contribute to CI an amount equal to 100% of the cash proceeds of (i)
\nthe incurrence of Indebtedness by Conoco or any of its Subsidiaries (other than
\nPetrozuata) (net of underwriting discounts and commissions and other reasonable
\ncosts (other than Separation Expenses) associated therewith, such other
\nreasonable costs to be mutually agreed upon by Conoco and DuPont) except for the
\nincurrence of Indebtedness pursuant to the Revolving Credit Facility or (ii) the
\nissuance or sale of equity securities by Conoco or any of its Subsidiaries (net
\nof underwriting discounts and commissions and other reasonable costs (other than
\nSeparation Expenses) associated therewith, such other reasonable costs to be
\nmutually agreed upon by Conoco and DuPont); provided, however, that to the
\nextent that amounts are to be paid pursuant to this subsection (d) in respect of
\nthe Restructured Note, Conoco shall make such payments directly. Immediately
\nfollowing any loan or contribution described above, Conoco shall cause CI to pay
\nthe entire amount of such loan or contribution (which will be equal to 100% of
\nthe cash proceeds received by Conoco or any of its Subsidiaries as described in
\nclauses (i) and (ii) above) to the holder or holders of the New Notes in partial
\nsatisfaction of its obligations under the New Notes, except to the extent that
\nall or part of the amount of such loan or contribution is used to repay any
\nIndebtedness of Conoco, CI or any of their Subsidiaries to DuPont and any of its
\nSubsidiaries, other than Conoco, CI and their Subsidiaries, but only to the
\nextent DuPont consents<\/p>\n
31
\n 38
\nto the repayment of such Indebtedness in lieu of payment under the New Notes.
\nAmounts applied to the prepayment of the New Notes as provided in this Section
\n2.5(d) shall be applied (a) first, to the accrued and unpaid interest on the
\nNote, (b) second, to the principal of the Note (c) third, to accrued and unpaid
\ninterest on the portions, if any, of the Restructured Note and the Conoco Master
\nNote that remain outstanding in accordance with Section 2.5(c), (d) fourth, to
\nthe principal of the Employee Benefits Note and (e) fifth, to the principal of
\nthe notes referred to in clause (c) above. Notwithstanding the foregoing, the
\nprovisions of Section 2.5(d)(ii) shall not apply to the net proceeds received
\nfrom the exercise of stock options granted to directors, officers and employees
\nof the relevant entity.<\/p>\n
(e) In addition, on or before the Cash Settlement
\nDate, DuPont shall pay CI amounts owed under the DuPont Master Note, including
\naccrued interest thereon.<\/p>\n
Section 2.6 Registration of Conoco Shares.<\/p>\n
(a) Conoco has filed a registration statement on Form
\nS-1 (as the same may be amended from time to time, including all exhibits
\nthereto, the “Registration Statement”) under the Securities Act covering the
\nnumber of shares of Class A Common Stock set forth therein (which sets forth
\nappropriate disclosure concerning Conoco, the Transferred Business, the
\nTransferred Assets, the IPO and certain other matters).<\/p>\n
(b) As promptly as practicable following the date of
\nthis Agreement (to the extent not theretofore accomplished):<\/p>\n
(i) Conoco will use its best efforts to cause such
\n Registration Statement to be declared effective and
\n to effect the IPO in accordance with the terms of
\n this Agreement, including by (1) responding promptly
\n to any comments from the SEC with respect thereto,
\n after consultation with DuPont, and (2) taking such
\n other actions as shall be reasonably required in
\n order to have the Registration Statement declared
\n effective under the Securities Act as soon as
\n reasonably practicable following the date hereof.<\/p>\n
(ii) Conoco shall file in a timely manner with the SEC and
\n cause to become effective any registration statements
\n or amendments<\/p>\n
32
\n 39
\n thereto which are appropriate to reflect the
\n establishment of, or amendments to, any employee
\n benefit and other plans relating to the Transferred
\n Business contemplated by the Employee Matters
\n Agreement or described in the Registration Statement.<\/p>\n
(iii) Conoco shall take all such action as may be necessary
\n or appropriate to register or qualify the Class A
\n Common Stock under state securities or “Blue Sky”
\n Laws or such other action under such laws as is
\n necessary or appropriate in connection with the
\n transactions contemplated by this Agreement.<\/p>\n
(iv) Conoco shall enter into certain agreements (including
\n an underwriting agreement) necessary or appropriate
\n to facilitate the IPO.<\/p>\n
(v) Conoco shall obtain “comfort” letters and updates
\n thereof from its independent accountants addressed to
\n the underwriters of the IPO, such letters to be in
\n customary form and covering matters of the type
\n customarily covered in “comfort” letters to
\n underwriters.<\/p>\n
(vi) Conoco shall cooperate with the underwriters of the
\n IPO to facilitate timely preparation and delivery of
\n certificates representing the Class A Common Stock
\n and to enable the Class A Common Stock to be in such
\n denominations and registered in such names as the
\n underwriters may request.<\/p>\n
(vii) Conoco shall participate and have senior management
\n of Conoco available to participate in any “roadshow”
\n marketing efforts reasonably requested by the lead
\n managing underwriter of the IPO.<\/p>\n
(viii) Conoco shall prepare, and Conoco shall file and seek
\n to make effective, an application to permit listing
\n of the Class A Common Stock on the NYSE.<\/p>\n
(c) DuPont and Conoco agree that DuPont shall have
\nthe right, in its sole discretion, to determine whether to satisfy or cause to
\nbe satisfied, the underwriter’s over-allotment option in the IPO with shares of
\nConoco sold by<\/p>\n
33
\n 40
\nDuPont, Conoco or some combination of shares of Conoco sold by DuPont and
\nConoco.<\/p>\n
ARTICLE III<\/p>\n
ASSUMPTION AND RETENTION OF LIABILITIES<\/p>\n
Section 3.1 Assumed Liabilities. Upon the terms set forth in
\nthis Agreement, Conoco hereby agrees with DuPont to, or to cause the appropriate
\nTransferred Business Company to, assume, and agree to pay, perform and discharge
\npromptly when due any and all Assumed Liabilities; provided however, that
\nnotwithstanding the foregoing, nothing in this Section 3.1 shall require Conoco
\nto make a capital contribution to, or otherwise invest in, purchase assets or
\nservices from, or lend, advance or otherwise supply or accelerate the payment of
\nfunds to, any of the Transferred Business Companies in order to enable such
\nTransferred Business Company to satisfy an Assumed Liability.<\/p>\n
Section 3.2 Retained Liabilities. Upon the terms set forth in
\nthis Agreement, DuPont hereby agrees with Conoco to, or to cause a Retained
\nSubsidiary to, pay, perform and discharge promptly when due any and all Retained
\nLiabilities, including all Liabilities expressly assumed by DuPont and any
\nRetained Subsidiary under the terms of this Agreement or any of the Related
\nAgreements; provided however, that notwithstanding the foregoing, nothing in
\nthis Section 3.2 shall require DuPont to make a capital contribution to, or
\notherwise invest in, purchase assets or services from, or lend, advance or
\notherwise supply or accelerate the payment of funds to, any of the Retained
\nSubsidiaries in order to enable such Retained Subsidiary to satisfy a Retained
\nLiability.<\/p>\n
Section 3.3 Construction of Agreements. Notwithstanding any
\nother provision in this Agreement to the contrary, in the event and to the
\nextent that there shall be a conflict between the provisions of this Agreement
\nand the provisions of any Related Agreement or any other agreement entered into
\nby DuPont or the Retained Subsidiaries, on one hand, and Conoco or the
\nTransferred Business Companies on the other hand, pursuant to this Agreement or
\nthe Related Agreements, the provisions of this Agreement shall control except
\nfor conflicts between the provisions of this Agreement and any Principal Related
\nAgreement, in which case the provisions of such Principal Related Agreement
\nshall control; provided, however, notwithstanding the foregoing, in the case of
\na conflict between the provisions of this<\/p>\n
34
\n 41
\nAgreement and the provisions of one of the several Transitional Services
\nAgreements, the provisions of the particular Transitional Services Agreement
\nshall control only to the extent that (x) the provision in question is contained
\nin the form of Transitional Services Agreement attached hereto as Exhibit F or
\n(y) is approved by the General Counsel or an Associate General Counsel of both
\nDuPont and Conoco.<\/p>\n
ARTICLE IV<\/p>\n
CERTAIN RESTRUCTURING DEFINITIONS<\/p>\n
Section 4.1 Assumed Liabilities. “Assumed Liabilities” shall
\nmean any and all Liabilities, whether arising before or after the Effective
\nDate, of DuPont or its Subsidiaries (including Conoco and the Transferred
\nBusiness Companies), or any of their predecessor companies or businesses, or any
\nof their Affiliates, Subsidiaries or divisions, relating to, resulting from or
\narising out of the present, past or future operation or conduct of the Conoco
\nBusiness or ownership or use of Assets in the Conoco Business (including the
\nownership or use of the Transferred Assets). “Assumed Liabilities” shall include
\nbut not be limited to the following:<\/p>\n
(a) all Liabilities which would properly be set
\nforth, reflected, disclosed or reserved for on a combined balance sheet of
\nConoco and the Transferred Business Companies as of the Effective Date, prepared
\nin the same manner as the most recent audited combined balance sheet of Conoco
\nincluded in the Registration Statement (after giving effect to any pro forma
\nadjustments reflected in the Registration Statement), but excluding any such
\nLiabilities attributable to DuPont Netherlands;<\/p>\n
(b) all Liabilities pursuant to, under or relating to
\nall Contracts relating exclusively to the Conoco Business or the Transferred
\nAssets, regardless of whether Conoco or a Transferred Business Company or DuPont
\nor a Retained Subsidiary is a party to such Contract;<\/p>\n
(c) all warranty, performance and similar obligations
\nentered into or incurred in the course of business of the Conoco Business with
\nrespect to its products;<\/p>\n
(d) all Conoco Environmental Liabilities;<\/p>\n
35
\n 42
\n (e) all Liabilities and obligations assumed by,
\nretained by or agreed to be performed by Conoco or any of its Subsidiaries
\npursuant to this Agreement or any of the Related Agreements;<\/p>\n
(f) all Liabilities relating to, arising out of or
\nresulting from the Conoco Actions and all Liabilities relating to, arising out
\nof or resulting from all other Actions which are related to, or arise out of the
\noperations or conduct of the Conoco Business or the ownership or use of the
\nAssets in the Conoco Business (including the ownership of the Transferred
\nAssets), whether arising before or after the Effective Date;<\/p>\n
(g) all Liabilities relating to all Actions for
\nalleged or actual patent infringement relating to, resulting from or arising out
\nof the use by DuPont or any Retained Subsidiary of any Conoco Patents in
\naccordance with the immunity described in Section 7.12(a);<\/p>\n
(h) all Liabilities relating to, resulting from or
\narising out of the transfer of the Transferred Assets pursuant to this Agreement
\nor the Related Agreements other than Liabilities for Separation Expenses;<\/p>\n
(i) Conoco’s portion, determined pursuant to Section
\n4.5 hereof, of Shared Contractual Liabilities;<\/p>\n
(j) all Liabilities relating to, resulting from or
\narising out of the business and operations sold to Vista Chemical by DuPont and
\nConoco;<\/p>\n
(k) all Liabilities relating to, arising out of or
\nresulting from the ownership or use of Excluded Assets to the extent they arise
\nout of (1) the use of such Assets in, or for the benefit of, the Conoco Business
\nor (2) the operation or use of such Assets by Conoco or a Transferred Business
\nCompany or an employee thereof;<\/p>\n
(l) all Liabilities relating to, resulting from, or
\narising out of options to purchase stock of Conoco, including options issued
\npursuant to Section 2.06 of the Employee Matters Agreement;<\/p>\n
(m) all Liabilities arising from any activities and
\noperations of DuPont, any of its Subsidiaries and any of their employees
\n(including, but not<\/p>\n
36
\n 43
\nlimited to, the activities and operations of Sentinel and DERS) to the extent
\nperformed for or on behalf of the Conoco Business; and<\/p>\n
(n) all Liabilities arising from the actions and
\nactivities of Conoco and the Transferred Business Companies in connection with
\nthe AEP Proposed Joint Ventures;<\/p>\n
provided, however, that notwithstanding the foregoing, Assumed Liabilities shall
\nin no event include (i) any Liabilities with respect to any Environmental Claims
\nor Requirements of Environmental Law that are neither Conoco Environmental
\nLiabilities nor provided for in clause (j) above, (ii) Liabilities that relate
\nto Taxes other than pursuant to this Agreement or any of the Related Agreements,
\nincluding the Tax Sharing Agreement or (iii) any Liabilities for Separation
\nExpenses.<\/p>\n
Section 4.2 Retained Liabilities. “Retained Liabilities” shall
\nmean any and all Liabilities, whether arising before or after the Effective
\nDate, of DuPont or its Subsidiaries or any of their predecessor companies or
\nbusinesses, or any of their Affiliates, Subsidiaries or divisions relating to,
\nresulting from or arising out of the present, past or future operations or
\nconduct of the DuPont Business, or ownership or use of the DuPont Transferred
\nAssets or any other Assets (other than the Transferred Assets) owned by DuPont
\nand the Retained Subsidiaries, other than any Assumed Liabilities. “Retained
\nLiabilities” shall include but not be limited to the following (other than any
\nwhich are Assumed Liabilities):<\/p>\n
(a) all Liabilities arising out of, relating to or
\nresulting from the ownership or use of the Excluded Assets to the extent they
\narise out of (1) the use of such Assets in, or for the benefit of, the DuPont
\nBusiness or (2) the operation or use of such Assets by DuPont or a Retained
\nsubsidiary or an employee thereof;<\/p>\n
(b) all Liabilities pursuant to, under or relating to
\nall Contracts relating exclusively to the DuPont Business or the DuPont
\nTransferred Assets or any other Assets (other than the Transferred Assets) owned
\nby DuPont and the Retained Subsidiaries, regardless of whether Conoco or a
\nTransferred Business Company or DuPont or a Retained Subsidiary is a party to
\nsuch Contract;<\/p>\n
(c) all warranty, performance and similar obligations
\nentered into or incurred in the course of business of the DuPont Business with
\nrespect to its products;<\/p>\n
37
\n 44
\n (d) all DuPont Environmental Liabilities;<\/p>\n
(e) all Liabilities and obligations assumed by,
\nretained by, or agreed to be performed by DuPont or any of the Retained
\nSubsidiaries pursuant to this Agreement or any of the Related Agreements;<\/p>\n
(f) all Liabilities relating to Actions relating to,
\nresulting from or arising out of the DuPont Actions and all Liabilities relating
\nto, resulting from or arising out of all other Actions, which are related to or
\narise out of the operations or conduct of the Retained Business or the ownership
\nor use of the Assets in the DuPont Business (including the DuPont Transferred
\nAssets and the Excluded Assets), whether arising before or after the Effective
\nDate (except in all cases the Actions described in Section 4.1(f) hereof);<\/p>\n
(g) the Liabilities relating to all Actions for
\nalleged or actual patent infringement relating to, resulting from or arising out
\nof the use by Conoco or any Transferred Business Company of any DuPont Patents
\nin accordance with the immunity described in Section 7.12(b);<\/p>\n
(h) All Liabilities for Separation Expenses;<\/p>\n
(i) DuPont’s portion, determined pursuant to Section
\n4.5 hereof, of Shared Contractual Liabilities;<\/p>\n
(j) All Liabilities relating to, resulting from or
\narising out of the businesses and operations sold to Cain Chemical, including
\nthe operations at Matagorda and Chocolate Bayou, Texas;<\/p>\n
(k) All Liabilities relating to, resulting from or
\narising out of options to purchase stock of DuPont (including, without
\nlimitation, options held by retired employees, but excluding Liabilities
\nrelating to, resulting from or arising out of the cancellation of such options
\nupon the issuance of options to purchase stock of Conoco pursuant to Section
\n2.06 of the Employee Matters Agreement) other than the Employee Benefits Note;<\/p>\n
(l) All Liabilities arising from any activities and
\noperations of Conoco, any of the Transferred Business Companies and any of their
\nemployees to the extent performed for or on behalf of the DuPont Business; and<\/p>\n
38
\n 45
\n (m) all Liabilities arising from the actions and
\nactivities of DuPont and the Retained Subsidiaries in connection with the AEP
\nProposed Joint Ventures;<\/p>\n
provided, however, that notwithstanding the foregoing, Retained Liabilities
\nshall in no event include any (i) Liabilities with respect to any Environmental
\nClaims or Requirements of Environmental Law that are neither DuPont
\nEnvironmental Liabilities nor provided for in clause (j) above or (ii)
\nLiabilities that relate to Taxes other than pursuant to this Agreement or any of
\nthe Related Agreements, including the Tax Sharing Agreement.<\/p>\n
Section 4.3 Transferred Assets. “Transferred Assets” shall
\nmean collectively (i) any and all Assets of Conoco and the Transferred Business
\nCompanies (other than any Mixed- Use Subsidiaries) following consummation of the
\nRestructuring, (ii) the Assets of the Mixed-Use Subsidiaries used primarily in
\nthe Conoco Business and (iii) the Assets set forth on Schedule 1(c), but in any
\nevent excluding the Excluded Assets.<\/p>\n
Section 4.4 Excluded Assets. “Excluded Assets” shall mean:<\/p>\n
(a) the Assets of the Construction Fleet except for
\nthe Assets listed on Schedule 1(c); and<\/p>\n
(b) the Assets listed on Schedule 4.4 as the same may
\nbe supplemented from time to time prior to the Effective Date by DuPont, after
\nconsultation with Conoco.<\/p>\n
Section 4.5 Shared Contracts.<\/p>\n
(a) With respect to Shared Contractual Liabilities
\npursuant to, under or relating to a given Shared Contract, such Shared
\nContractual Liabilities shall be allocated between the parties as follows:<\/p>\n
(i) First, if a Liability is incurred exclusively in
\n respect of a benefit received by one party, the party
\n receiving such benefit shall be responsible for such
\n Liability.<\/p>\n
(ii) Second, if a Liability cannot be so allocated under
\n clause (i), such Liability shall be allocated to the
\n parties based on the<\/p>\n
39
\n 46
\n relative proportions of total benefit received (over
\n the term of the Shared Contract, measured as of the
\n date of the allocation) under the relevant Shared
\n Contract. Notwithstanding the foregoing, each party
\n shall be responsible for any or all Liabilities
\n arising out of or resulting from its breach of the
\n relevant Shared Contract.<\/p>\n
(b) If DuPont or any Retained Subsidiary, on the one
\nhand, or Conoco or any Transferred Business Company, on the other hand, receives
\nany benefit or payment under any Shared Contract which was intended for other
\nparty, DuPont and the Retained Subsidiaries, on the one hand, or Conoco and the
\nTransferred Business Companies, on the other hand, will use their respective
\nreasonable best efforts to deliver, transfer or otherwise afford such benefit or
\npayment (on an after-tax basis) to the other party.<\/p>\n
ARTICLE V<\/p>\n
CORPORATE GOVERNANCE AND CERTAIN FINANCIAL REPORTING
\n AND OTHER MATTERS<\/p>\n
Section 5.1 Rights Plan Amendments. Following the Effective
\nDate and for so long as DuPont beneficially owns shares representing at least
\n30% of the voting power of all of the outstanding shares of Voting Stock,
\nwithout the prior written consent of DuPont, Conoco shall not amend or modify
\nthe Conoco Rights Plan.<\/p>\n
Section 5.2 Charter\/bylaw Amendments. So long as DuPont owns
\nshares representing 30% of the voting power of all of the outstanding shares of
\nVoting Stock, Conoco will not, without the prior consent of DuPont, adopt any
\namendments to its Restated Certificate of Incorporation or Bylaws or take or
\nrecommend to its stockholders any action during the term of this Agreement which
\nwould (i) impose limitations on the legal rights of DuPont or any of the
\nRetained Subsidiaries as Conoco stockholders other than those imposed pursuant
\nto the express terms of this Agreement or the form of Conoco’s Restated
\nCertificate of Incorporation set forth as Exhibit A hereto, including, without
\nlimitation, any action which would impose restrictions (A) based upon the size
\nof security holding, the business in which a security holder is engaged or other
\nconsiderations applicable to DuPont or any of the Retained Subsidiaries and not
\nto security holders generally, or (B) with reference<\/p>\n
40
\n 47
\nto Class B Common Stock (or if no Shares of Class B Common Stock are then
\noutstanding, to Class A Common Stock) generally, by means of the issuance of or
\nproposal to issue any other class of securities having voting power
\ndisproportionately greater than the equity investment in the Company
\nrepresented by such securities; (ii) involve the issuance or corporate action
\nproviding for the issuance of any warrant, capital stock or other security (A)
\nwhich is, or under specified circumstances will become, convertible into or
\nrepresent the right to acquire any securities of DuPont or any of the Retained
\nSubsidiaries (other than pursuant to customary provisions for adjusting the
\nsecurities for which any such warrant is exercisable or into which any such
\nstock or security is convertible) or (B) any other rights which (including
\nrights of redemption) are dependent upon the amount of voting securities owned
\nby DuPont or any of the Retained Subsidiaries; (iii) deny any benefit to DuPont
\nor any of the Retained Subsidiaries proportionately as holders of any class of
\nvoting securities that is made available to other holders of the same class of
\nvoting securities generally; or (iv) alter voting or other rights of the holders
\nof any class of voting securities so that any such rights (or the vote required
\nwith respect to any matter) are determined with reference to the amount of
\nvoting securities held by DuPont or any of the Retained Subsidiaries; provided,
\nthat this Section 5.2 shall not prohibit Conoco from adopting the Conoco Rights
\nPlan or taking any action otherwise prohibited hereby, so long as DuPont and the
\nRetained Subsidiaries are, either expressly or as part of a class of
\nstockholders which includes DuPont and the Retained Subsidiaries, exempted from
\nsuch action or the limitations on legal rights imposed thereby.<\/p>\n
Section 5.3 Conoco Board Representation. (a) Beginning on the
\nEffective Date, and for so long as DuPont beneficially owns shares representing
\n50% or more of the voting power of all of the outstanding Voting Stock, DuPont
\nshall have the right to designate for nomination by the Conoco Board (or any
\nnominating committee thereof) to the Conoco Board a majority of the members of
\nthe Conoco Board. For so long as DuPont beneficially owns shares representing
\nless than 50% but more than 10% of the voting power of all of the outstanding
\nVoting Stock, DuPont shall have the right to designate for nomination by the
\nConoco Board (or any nominating committee thereof) to the Conoco Board a
\nproportionate number of members of the Conoco Board, as calculated in accordance
\nwith Section 5.3(d). Notwithstanding anything to the contrary set forth herein,
\nConoco’s obligations with respect to the election or appointment of DuPont
\ndesignated members shall be limited to the obligations set forth under
\nsubsections (b) and (c) below.<\/p>\n
(b) Conoco shall exercise all authority under
\napplicable law and shall use its best efforts to cause five persons designated
\nby DuPont to be elected to the Conoco Board effective as of the Effective Date
\n(one such designee of DuPont<\/p>\n
41
\n 48
\nin Class I and two such designees of DuPont in each of Class II and Class III
\nfor terms ending on the first, second and third annual meetings thereafter,
\nrespectively). Commencing with the annual meeting of stockholders of Conoco to
\nbe held in 1999 and prior to each annual meeting of stockholders of Conoco
\nthereafter, DuPont shall be entitled to present to the Conoco Board or any
\nnominating committee thereof such number of designees of DuPont (each, a “DuPont
\nDesignee”) for election to the class of directors up for election to the Conoco
\nBoard at such annual meeting as would result in DuPont having the appropriate
\nnumber of DuPont Designees on the Conoco Board as determined pursuant to
\nsubsection (a) above. If the Conoco Board ceases to be a classified board,
\nDuPont shall be entitled to present to the Conoco Board or any nominating
\ncommittee thereof five (or such other number of DuPont Designees as would result
\nin DuPont having the appropriate number of DuPont Designees on the Board as
\ndetermined pursuant to subsection (a) above) DuPont Designees, or such other
\nnumber of designees, as determined pursuant to Section 5.3(d), for election to
\nthe Conoco Board at each annual meeting of stockholders of Conoco.<\/p>\n
(c) Conoco shall at all such times exercise all
\nauthority under applicable law and use its best efforts to cause all such
\ndesignees to be nominated as Board members by the nominating committee of the
\nConoco Board if there is such a committee. Conoco shall cause each DuPont
\nDesignee for election to the Conoco Board to be included in the slate of
\ndesignees recommended by the Conoco Board to Conoco’s stockholders for election
\nas directors at each annual meeting of the stockholders of Conoco (or at any
\nspecial meeting held for the election of directors) and shall use its best
\nefforts to cause the election of each such DuPont Designee, including soliciting
\nproxies in favor of the election of such persons. In the event that any DuPont
\nDesignee elected to the Conoco Board shall cease to serve as a director for any
\nreason, the vacancy resulting therefrom shall be filled by the Conoco Board with
\na substitute DuPont Designee, unless such vacancy was caused by action of
\nstockholders (in which case, in accordance with Conoco’s Restated Certificate of
\nIncorporation, the stockholders shall fill such vacancy). In the event that as a
\nresult of an increase in the size of the Conoco Board, DuPont is entitled to
\nhave one or more additional DuPont Designees elected to the Conoco Board
\npursuant to subsection (a) above, the Conoco Board shall appoint the appropriate
\nnumber of such additional DuPont Designees, unless such increase in size of the
\nConoco Board was caused by the action of stockholders (in which case, in
\naccordance with Conoco’s Restated Certificate of Incorporation, the stockholders
\nshall elect such additional director or directors). The parties hereto agree
\nthat the directors of Conoco identified in the Registration Statement include
\nfive DuPont Designees.<\/p>\n
(d) If at any time that DuPont Designees are serving
\non the Conoco Board, DuPont beneficially owns shares representing less than 50%
\nbut<\/p>\n
42
\n 49
\nmore than 10% of the total voting power of all of the outstanding Voting Stock,
\nthe number of persons DuPont shall be entitled to designate for nomination by
\nthe Conoco Board (or any nominating committee thereof) for election to the
\nConoco Board shall be equal to the number of directors computed using the
\nfollowing formula (rounded to the nearest whole number): the product of (1) the
\npercentage of the voting power of all of the outstanding shares of common stock
\nof Conoco beneficially owned by DuPont and (2) the number of directors then on
\nthe Conoco Board (assuming no vacancies exist). Notwithstanding the foregoing,
\nif DuPont beneficially owns shares of common stock of Conoco representing less
\nthan 50% of the total voting power of all outstanding shares of common stock of
\nConoco and the calculation of the formula set forth in the foregoing sentence
\nwould result in DuPont being entitled to elect a majority of the members of the
\nConoco Board, the formula will be recalculated with the product being rounded
\ndown to the nearest whole number; provided, however, that if DuPont, at any
\ntime, acquires additional common stock of Conoco so that DuPont beneficially
\nowns shares of common stock of Conoco representing 50% or more of the total
\nvoting power of all of the outstanding shares of common stock of Conoco, then
\nthe number of persons DuPont shall be entitled to designate for nomination by
\nthe Conoco Board (or any nominating committee thereof) for election to the
\nConoco Board shall be adjusted upward, if appropriate as a result of rounding,
\nin accordance with the provisions of this Section 5.3(d). If the number of
\nDuPont Designees serving on the Conoco Board exceeds the number determined
\npursuant to the foregoing sentences of this Section 5.3(d) (such difference
\nbeing herein called the “Excess Director Number”), then DuPont shall use its
\nreasonable best efforts to cause DuPont Designees selected by DuPont in its sole
\ndiscretion (the number of which designees shall be equal to the Excess Director
\nNumber) to promptly resign from the Conoco Board, and, to the extent such
\npersons do not so resign, DuPont shall assist Conoco in increasing the size of
\nthe Conoco Board, so that after giving effect to such increase, the number of
\nDuPont Designees on the Conoco Board is in accordance with the provisions of
\nthis Section 5.3(d).<\/p>\n
Section 5.4 Committees. Effective as of the Effective Date and
\nfor so long as DuPont beneficially owns shares of common stock of Conoco
\nrepresenting 50% or more of the voting power of all of the outstanding shares of
\ncommon stock of Conoco, the Audit and Compliance Committee and the Compensation
\nCommittee and any other committee of the Conoco Board which performs functions
\nanalogous to those normally performed by the foregoing types of committees shall
\nbe composed of directors at least a majority of which are DuPont Designees and
\neach other committee of the Conoco Board shall include at least one DuPont
\nDesignee. Effective as of the Effective Date and for so long as DuPont
\nbeneficially owns shares of common stock of Conoco representing less than 50%
\nbut more than 10% of the<\/p>\n
43
\n 50
\nvoting power of all of the outstanding shares of common stock of Conoco, each
\ncommittee of the Conoco Board shall, unless DuPont consents otherwise, include
\nat least one DuPont Designee. The parties hereto agree that the members of
\nConoco’s Audit and Compliance Committee and Conoco’s Compensation Committee
\nidentified in the Registration Statement are composed of directors at least a
\nmajority of which are DuPont Designees.<\/p>\n
Section 5.5 Accounting Principles. (a) Effective as of the
\nEffective Date and for so long as DuPont beneficially owns shares of common
\nstock of Conoco representing 50% or more of the voting power of all of the
\noutstanding Voting Stock, Conoco may not change its accounting principles or
\npractices if a change in such accounting principle or practice would be required
\nto be disclosed in Conoco’s financial statements as filed with the SEC or
\notherwise publicly disclosed therein without the prior written consent of
\nDuPont, except for changes which are required by GAAP and as to which there is
\nno discretion on the part of Conoco, as concurred in by Conoco’s auditors prior
\nto its implementation.<\/p>\n
(b) For so long as DuPont beneficially owns shares
\nrepresenting 20% or more of the voting power of the outstanding Voting Stock (i)
\nConoco will furnish DuPont within nine (9) business days after the end of each
\nquarter and eleven (11) business days after the end of each fiscal year, the
\nunaudited balance sheet, income statement and statement of cash flows of Conoco
\nand its Subsidiaries as at the end of such period, (ii) Conoco shall furnish to
\nDuPont such financial information or documents in the possession of Conoco or
\nany of its Subsidiaries as DuPont may reasonably request, and (iii) Conoco shall
\nfurnish to DuPont on a monthly basis such management and other periodic reports
\nrelated to financial information in the form and substance consistent with the
\npractice of Conoco as of the date of this Agreement. For so long as DuPont
\nbeneficially owns shares representing 50% or more of the voting power of all of
\nthe outstanding Voting Stock, Conoco will furnish DuPont the consolidated
\nbalance sheet, consolidated income statement and consolidated statement of cash
\nflows, if any, of Conoco and its Subsidiaries as at the end of each such
\nquarterly and annual period in the form and substance consistent with the
\npractice of Conoco as of the date of this Agreement.<\/p>\n
Section 5.6 Tax Free Spin-Off.<\/p>\n
(a) At any time after the Effective Date, if DuPont
\nadvises Conoco that it intends to pursue a Tax-Free Spin-Off (as defined in
\nExhibit A hereto) or that it intends to otherwise distribute all or a portion of
\nthe capital stock of Conoco beneficially owned by DuPont to its securityholders
\nby way of dividend, exchange or<\/p>\n
44
\n 51
\notherwise, Conoco agrees to take all action reasonably requested by DuPont to
\nfacilitate such transaction and, subject to the following sentence, DuPont shall
\nreimburse Conoco for its reasonable out-of-pocket expenses incurred in
\nconnection with such actions. In the event a registration statement is filed in
\nconnection with such transaction, Conoco and DuPont will cooperate to take
\nactions analogous (to the extent applicable) to those set forth in the
\nRegistration Rights Agreement with respect to a Demand Registration and in
\nparticular the parties will indemnify and provide contribution to each other in
\na manner analogous to that set forth in Section 8 of the Registration Rights
\nAgreement.<\/p>\n
(b) Prior to a Tax-Free Spin-Off, (i) Conoco will
\nhave the right to propose to DuPont an amendment to its certificate of
\nincorporation providing for the automatic conversion on a one-for-one basis of
\nthe shares of Class B Common Stock into shares of Class A Common Stock upon the
\noccurrence of circumstances specified in such proposal so long as such amendment
\n(a) does not otherwise affect any of the rights of the holders of Class A Common
\nStock or Class B Common Stock (including rights of transferability) or affect
\nthe ability (except with respect to the tax-free nature of the spin-off) to
\naccomplish the Tax-Free Spin-Off and (b) is otherwise valid under the Delaware
\nGeneral Corporation Law (the “Charter Amendment”) and (ii) if DuPont seeks to
\nobtain from the IRS a ruling (the “Ruling”) as to the tax-free nature of the
\nTax-Free Spin-Off, then DuPont will diligently pursue obtaining such ruling on
\nthe basis that such Charter Amendment is effective; provided, however, that
\nnotwithstanding anything to the contrary DuPont shall not be required (x) to
\npropose or to raise with the IRS any Charter Amendment which, based on the
\nadvice of its counsel, DuPont reasonably believes will, if effective, result in
\na material delay in, or material reduction in the likelihood of, obtaining such
\na favorable Ruling and (y) to file a ruling request with respect to, or continue
\nto pursue obtaining, the Ruling on the basis that the Charter Amendment is
\neffective if, after approaching the IRS, DuPont, in its sole discretion,
\ndetermines in good faith that pursuing such Ruling on such basis is having or
\nmay have an adverse effect on the ability to obtain the Ruling or result in a
\ndelay with respect thereto which DuPont in good faith believes may not be in its
\nbest interests. If DuPont determines to effect a Tax-Free Spin-Off without
\nobtaining a Ruling, it shall have no obligation with respect to any proposed
\nCharter Amendment if it concludes, in good faith, after consultation with
\ncounsel, that such Charter Amendment would result in an increased risk that the
\nintended Tax-Free Spin-Off would not qualify under section 355 of the Code (or
\nany successor provision) and be tax-free to DuPont, its shareholders or Conoco.<\/p>\n
45
\n 52
\n Section 5.7 Survival of Rights. In the event Conoco ceases to
\nbe a publicly traded company or becomes a Subsidiary of a publicly traded
\nCompany (other than DuPont), all of the rights of DuPont set forth in this
\nArticle V shall continue in full force and effect and shall apply to any
\npublicly traded company that, directly or indirectly, through one or more
\nintermediaries, controls Conoco. Conoco agrees that, without the consent of
\nDuPont, it will not enter into any Contract which will have the effect set forth
\nin the first clause of the preceding sentence, unless such publicly traded
\ncompany agrees to be bound by the foregoing provision. As used in this Section
\n5.7, “control” when used with respect to any specified Person means the power to
\ndirect the management and policies of such Person, directly or indirectly,
\nwhether through ownership of voting securities, by contract or otherwise.<\/p>\n
ARTICLE VI<\/p>\n
SURVIVAL, INDEMNIFICATION, CLAIMS
\n AND OTHER MATTERS<\/p>\n
Section 6.1 Survival of Agreements.<\/p>\n
(a) All covenants and agreements of the parties
\ncontained in this Agreement shall survive the Effective Date in accordance with
\ntheir terms; provided, however, that the covenants and agreements of the parties
\nset forth in this Article VI shall survive the Effective Date in perpetuity.<\/p>\n
(b) All of the obligations of DuPont and the Retained
\nSubsidiaries, on the one hand, and Conoco and its Subsidiaries, on the other
\nhand, pursuant to this Agreement shall survive and be unaffected by the sale or
\nother transfer by DuPont or any of the Retained Subsidiaries, on the one hand,
\nor Conoco or any of its Subsidiaries, on the other hand, of any their respective
\nAssets or businesses or the assignment by DuPont or any of the Retained
\nSubsidiaries, on the one hand, or Conoco or its Subsidiaries, on the other hand,
\nof any of their respective Liabilities.<\/p>\n
Section 6.2 Indemnification.<\/p>\n
(a) DuPont shall, and, in the case of clauses (i) and
\n(iii) below, shall in addition cause each of the Appropriate Retained
\nSubsidiaries to, indemnify, defend and hold harmless Conoco and its Subsidiaries
\nand each of their Affiliates engaged in the Conoco Business, and each of
\nConoco’s, such Subsidiaries’ and such Affiliates’ directors, officers, employees
\nand agents (each a “Conoco<\/p>\n
46
\n 53
\nParty”) from and against, and shall reimburse such Indemnitees with respect to,
\nany and all Losses relating to, resulting from or arising out of, (i) any of the
\nRetained Liabilities (whether arising prior to or after the Effective Date) and
\nall Liabilities arising out of the operation or conduct of the DuPont Business
\nor use or ownership of the DuPont Transferred Assets or any other Assets (other
\nthan the Transferred Assets) owned by DuPont and the Retained Subsidiaries after
\nthe Effective Date, (ii) any claim that the information included in the
\nRegistration Statement under the captions set forth on Schedule 6.2 hereto is
\nfalse or misleading with respect to any material fact or omits to state any
\nmaterial fact required to be stated therein or necessary in order to make the
\nstatements therein, in light of the circumstances under which they were made,
\nnot misleading, (iii) all Liabilities relating to, resulting from or arising out
\nof the use by DuPont or any Retained Subsidiary of any Non-Permitted Names
\npursuant to Sections 7.7 and 7.8, and (iv) any failure by a DuPont Party to
\nperform, or violation by a DuPont Party of, any provision of this Agreement or
\nthe Related Agreements which is to be performed or complied with by DuPont or
\nthe Retained Subsidiaries. As used in this subsection (a), the “Appropriate
\nRetained Subsidiary” shall mean the Retained Subsidiary, if any, whose
\nactivities or conduct (or whose predecessors’ activities or conduct) caused or
\nresulted in the Loss in question.<\/p>\n
(b) Conoco shall, and, in the case of clauses (i) and
\n(iv) below, shall in addition cause the Appropriate Conoco Subsidiaries to,
\nindemnify, defend and hold harmless DuPont and the Retained Subsidiaries and
\neach of their Affiliates, and each of DuPont’s, such Subsidiaries’ and such
\nAffiliates’ directors, officers, employees and agents (other than any Conoco
\nParty) (each a “DuPont Party”) from and against, and shall reimburse such
\nIndemnitees with respect to, any and all Losses relating to, resulting from or
\narising out of (i) any of the Assumed Liabilities (whether arising prior to or
\nafter the Effective Date) and all Liabilities arising out of the operation or
\nconduct of the Conoco Business or the use or ownership of the Transferred Assets
\nafter the Effective Date, (ii) any claim that the information included in the
\nRegistration Statement other than under the captions set forth on Schedule 6.2
\nhereto is false or misleading with respect to any material fact or omits to
\nstate any material fact required to be stated therein or necessary in order to
\nmake the statements therein, in light of the circumstances under which they were
\nmade, not misleading, (iii) any Liabilities of DuPont relating to, resulting
\nfrom or arising out of its status as a holder of shares, directly or indirectly,
\nof a Conoco Party, (iv) any Liabilities relating to, resulting from or arising
\nout of the use by Conoco or any of its Subsidiaries of any Non-Permitted Names
\npursuant to Sections 7.7 and 7.8, (v) any failure by a Conoco Party to perform,
\nor violation by a Conoco Party of, any provision of this Agreement or any of the
\nRelated Agreements which is to be<\/p>\n
47
\n 54
\nperformed or complied with by Conoco or any of its Subsidiaries. As used in this
\nsubsection (b), the “Appropriate Conoco Subsidiary” shall mean the Subsidiary of
\nConoco, if any, whose activities or conduct (or whose predecessors’ activities
\nor conduct) caused or resulted in the Loss in question.<\/p>\n
(c) Effective as of the Effective Time, Conoco for
\nitself and on behalf of its Subsidiaries hereby releases, remises and forever
\ndischarges each DuPont Party, in their respective capacities as such, from any
\nLiability, obligation or responsibility for any and all past actions or failures
\nto take action, including any actions which may be deemed to have been negligent
\nor grossly negligent, relating to, resulting from or arising out of the
\noperation or conduct of any businesses, Assets (including activities performed
\nthereat) or operations managed or operated by, or operationally related to,
\ndirectly or indirectly, the Conoco Business and the DuPont Business, except for
\nany Liability, obligation or responsibility for any action or failure to take
\naction in accordance with the provisions of this Agreement or for any fraudulent
\nact or willful or intentional misconduct in the operation or conduct of Conoco
\nBusiness or the DuPont Business prior to the Effective Date. Effective as of the
\nEffective Time, DuPont for itself and on behalf of its Subsidiaries hereby
\nreleases, remises and forever discharges each Conoco Party, in their respective
\ncapacities as such, from any Liability, obligation or responsibility for any and
\nall past actions or failures to take action, including any actions which may be
\ndeemed to have been negligent or grossly negligent, relating to, resulting from
\nor arising out of the operation or conduct of any businesses, Assets (including
\nactivities performed thereat) or operations managed or operated by, or
\noperationally related to, directly or indirectly, the Conoco Business and the
\nDuPont Business, except for any Liability, obligation or responsibility for any
\naction or failure to take action in accordance with the provisions of this
\nAgreement or for any fraudulent act or willful or intentional misconduct in the
\noperation or conduct of Conoco Business or the DuPont Business prior to the
\nEffective Date. Nothing set forth in this subsection (c) shall limit or
\notherwise affect any party’s rights or obligations pursuant to, or contemplated
\nby, this Agreement and the Related Agreements, including any obligations
\nrelating to indemnification and the assumption of Liabilities.<\/p>\n
(d) The amount which any Indemnifying Party is
\nrequired to pay to any Indemnitee pursuant to Section 6.2(a) or Section 6.2(b)
\nshall be reduced (including, but not limited to, retroactively) by any recovery,
\njudgment, settlement or other amounts actually recovered, including insurance
\nproceeds except to the extent attributable to risks retained solely by Danube
\nand Christiana (provided that, in accordance with Section 10.6(a) hereof (except
\nas otherwise provided in Section 10.6(b)), no Indemnitee shall be obligated to
\npursue insurance coverages under its<\/p>\n
48
\n 55
\nexcess liability insurance program for any Loss), by such Indemnitee in respect
\nof such Loss. If an Indemnitee shall have received an Indemnity Payment in
\nrespect of a Loss and shall subsequently actually receive a recovery, judgment,
\nsettlement or other amount in respect of such Loss, then such Indemnitee shall
\npromptly, but in no event later than five business days, pay to such
\nIndemnifying Party a sum equal to the lesser of the amount of such recovery,
\njudgment, settlement or other amount actually received, net of any taxes, or the
\namount of Indemnity Payments actually received previously in respect of such
\nLoss.<\/p>\n
(e) (i) An Indemnitee that has received an Indemnity
\nPayment in respect of a Loss from an Indemnifying Party shall pay to
\nsuch Indemnifying Party an amount equal to any Tax Saving Amount realized by
\nthe Indemnitee promptly upon its receipt. For purposes of this Section 6.2(e),
\nthe “Tax Saving Amount” shall equal the amount by which the Income Tax of the
\nIndemnitee or any of its Affiliates are reduced (including, without limitation,
\nthrough the receipt of a refund, credit or otherwise), plus any related interest
\nreceived from a Tax Authority, as a result of claiming as a deduction or offset
\non any relevant Tax Return (including, without limitation, any claim for refund)
\namounts attributable to a Loss (the “Indemnifiable Loss Deduction”). An
\nIndemnifying Party shall pay to an Indemnitee an amount equal to any increase in
\nthe Income Taxes of the Indemnitee as a result of receiving an indemnity payment
\nfrom the Indemnifying Party (grossed up to take into account such payment, if
\napplicable).<\/p>\n
(ii) In the event that an Indemnitee incurs a Loss, such
\n Indemnitee shall claim as a deduction or offset on
\n any relevant Tax Return (including, without
\n limitation, any claim for refund) such Loss to the
\n extent such position is supported by substantial
\n authority (as defined in Section 6.3(c) of the Tax
\n Sharing Agreement) with respect to U.S. federal,
\n state and local Tax Returns or has similar
\n appropriate authoritative support with respect to any
\n Tax Return other than U.S. federal, state and local
\n Tax Returns. The Indemnitee shall have primary
\n responsibility for the preparation of its Tax
\n Returns and reporting thereon such Indemnifiable Loss
\n Deduction; provided, that the Indemnitee shall
\n consult with, and provide the Indemnifying
\n Party with a reasonable opportunity to review and
\n comment on the portion of the Indemnitee’s Tax Return
\n relating to the Loss. If a dispute arises between the
\n Indemnitee and the Indemnifying Party as to whether
\n there is “substantial authority” (with respect to
\n U.S. federal, state and local Tax Returns) or similar<\/p>\n
49
\n 56
\n appropriate authoritative support (with respect to
\n any Tax Return other than U.S. federal, state and F
\n local Tax Returns) for the claiming of an
\n Indemnifiable Loss Deduction, such dispute shall be
\n resolved in accordance with the principles and
\n procedures set forth in Section 8 of the Tax Sharing
\n Agreement. Both DuPont and Conoco shall act in good
\n faith to coordinate their Tax Return filing positions
\n with respect to Indemnity Payments for the periods
\n that include an Indemnity Payment. There shall be an
\n adjustment to any Tax Saving Amount calculated under
\n Section 6.2(e)(i) hereof in the event of an Audit
\n which results in a Final Determination that increases
\n or decreases the amount of the Indemnifiable Loss
\n Deduction reported on any relevant Tax Return of the
\n Indemnitee. The Indemnitee shall promptly inform the
\n Indemnifying Party of any such Audit and shall
\n attempt in good faith to sustain the Indemnifiable
\n Loss Deduction at issue in the Audit. Upon receiving
\n a written notice of a Final Determination in respect
\n of an Indemnifiable Loss Deduction, the Indemnitee
\n shall redetermine the Tax Saving Amount attributable
\n to the Indemnifiable Loss Deduction under Section
\n 6.2(e)(i) hereof, taking into account the Final
\n Determination (the “Restated Tax Saving Amount”). If
\n the Restated Tax Saving Amount is greater than the
\n Tax Saving Amount, the Indemnitee shall promptly pay
\n the Indemnifying Party a sum equal to the difference
\n between such amounts. If the Restated Tax Saving
\n Amount is less than the Tax Saving Amount, then the
\n Indemnifying Party shall promptly pay the Indemnitee,
\n an amount equal to the difference between such
\n amounts.<\/p>\n
(iii) Notwithstanding any other provision of this
\n Agreement, to the extent permitted by applicable law,
\n the parties hereto agree that any Indemnity Payment
\n made hereunder shall be treated as a capital
\n contribution or dividend distribution, as the case
\n may be, immediately prior to the Effective Date, for
\n all Tax purposes, and accordingly, as not includible
\n in the taxable income of the recipient.<\/p>\n
(f) THE PARTIES HERETO UNDERSTAND AND AGREE THAT THE
\nINDEMNIFICATION OF AN INDEMNITEE BY AN INDEMNIFYING PARTY PURSUANT TO THIS
\nARTICLE VI MAY IN-<\/p>\n
50
\n 57
\nCLUDE INDEMNIFICATION FOR LOSSES RESULTING FROM OR ARISING OUT OF, DIRECTLY OR
\nINDIRECTLY, AN INDEMNITEE’S OWN NEGLIGENCE.<\/p>\n
(g) The indemnification provisions of this Article VI
\n(i) shall apply without regard to, and shall not be subject to, any limitation
\nby reason of set-off, limitation or otherwise and (ii) are intended to be
\ncomprehensive and not to be limited by any requirements of Law concerning
\nprominence of language or waiver of any legal right under any Law (including,
\nwithout limitation, rights under any workers compensation statute or similar
\nstatute conferring immunity from suit) and the parties hereto hereby waive all
\nsuch rights.<\/p>\n
Section 6.3 Procedure for Indemnification.<\/p>\n
(a) If any party shall receive notice of any Action
\nbrought, asserted, commenced or pursued other than by a DuPont Party or a Conoco
\nParty (hereinafter a “Third Party Claim”), with respect to which a DuPont Party
\nor a Conoco Party is or may be entitled to an Indemnity Payment, it shall give
\nthe potential Indemnifying Party prompt notice thereof (including any pleadings
\nrelating thereto) after becoming aware of such Third Party Claim, specifying in
\nreasonable detail the nature of such Third Party Claim and the amount or
\nestimated amount thereof to the extent then feasible (which estimate shall not
\nbe conclusive of the final amount of such claim); provided, however, that the
\nfailure of a party to give notice as provided in this Section 6.3(a) shall not
\nrelieve any Indemnifying Party of its indemnification obligations under this
\nArticle VI, except to the extent that any Indemnifying Party is actually
\nprejudiced by such failure to give notice.<\/p>\n
(b) For any Third Party Claim concerning which notice
\nis required to be given under subparagraph (a) of this Section 6.3, an
\nIndemnifying Party may elect to defend the Third Party Claim through counsel
\nappointed by the Indemnifying Party, which counsel shall be reasonably
\nsatisfactory to the Indemnitee. An Indemnifying Party electing to defend a Third
\nParty Claim must (i) notify the Indemnitee of its election to defend within 30
\ndays of receipt of notice of such claim pursuant to Section 6.3(a) or sooner if
\nthe nature of the Third Party Claim so requires and (ii) acknowledge and agree
\nin writing that if such Third Party Claim is adversely determined, such
\nIndemnifying Party will have an obligation to pay Indemnity Payments to the
\nIndemnitee in respect of the Indemnifiable Losses relating to such Third Party
\nClaim and that such Indemnifying Party waives all defenses it may have to
\ncontest such obligation. Notwithstanding the foregoing, DuPont, in its sole
\ndiscretion, upon written notice (which notice shall include<\/p>\n
51
\n 58
\nDuPont’s basis for electing to defend such Third Party Claim(s) and whether or
\nnot DuPont acknowledges its liability for Indemnity Payments with respect to
\nsuch Third Party Claim(s) in accordance with the prior sentence), may elect to
\ndefend (or assume the defense of) any Third Party Claim or series of related
\nThird Party Claims that:<\/p>\n
(i) relate in any way to the Conoco Business,
\nTransferred Assets or the Assumed Liabilities if a DuPont Party is named a party
\nthereto and if (x) DuPont’s or one of the Retained Subsidiaries’ ability to
\nconduct its business could be impaired in any significantly adverse manner
\nas a result of any injunctive relief sought or (y) an adverse resolution of such
\nThird Party Claim (or series of related Third Party Claims) presents in the
\ngood faith judgment of DuPont’s General Counsel a reasonable risk of having an
\nadverse effect on the business, operations, financial condition, results of
\noperations or prospects of (1) DuPont and the Retained Subsidiaries, taken as
\na whole, in an amount greater or equal to $300 million or (2) one of the
\nRetained Subsidiaries organized outside the United States in an amount
\ngreater than or equal to $50 million, in which case (A) DuPont or one of the
\nRetained Subsidiaries shall pay all costs and expenses incurred in connection
\nwith the defense of such Third Party Claim(s) if DuPont or one of the Retained
\nSubsidiaries is the Indemnifying Party with respect to such Third Party Claim(s)
\nor (B) such costs and expenses shall be included in DuPont’s or one of the
\nRetained Subsidiary’s Losses if Conoco or one of its Subsidiaries is the
\nIndemnifying Party with respect to such Third Party Claim(s); or<\/p>\n
(ii) with respect to which both parties hereto, or
\nConoco and a Retained Subsidiary, or DuPont and a Subsidiary of Conoco may be
\nIndemnifying Parties, and to which paragraph (i) above does not apply and as
\nto which, in the good faith judgement of the General Counsel of DuPont, the
\nportion of the aggregate Liability that is the responsibility of DuPont and any
\nRetained Subsidiaries (after taking into account indemnification obligations
\nhereunder) equals or exceeds the portion of such Liability that is the
\nresponsibility of Conoco and any Subsidiaries of Conoco. In any case in which
\nboth DuPont and Conoco may be Indemnifying Parties with respect to a Third-Party
\nClaim, regardless of whether DuPont has the right to defend pursuant to this
\nparagraph (b)(ii), all costs and expenses shall be paid by the party
\nobligated to make any Indemnification Payment to the other, if they are not both
\nrequired to do so, and if they are both so required, or neither is so required,
\nthen all costs and expenses shall be paid by the parties pro rata based on
\ntheir respective proportionate liability for any settlement or judgment
\nreached or entered (after taking into account any Indemnification Payments
\npursuant<\/p>\n
52
\n 59
\nto this Agreement). If neither party has any liability to a third party, the
\nparties shall share the fees and expenses equally.<\/p>\n
(c) The Indemnifying Party’s right to defend any
\nThird Party Claim includes the right (after consultation with the Indemnitee
\nfollowing at least five business days written notice thereof) to compromise,
\nsettle or consent to the entry of any judgment or determination of liability
\nconcerning such Third Party Claim; provided, however, that the Indemnifying
\nParty shall not compromise, settle or consent to the entry of judgment or
\ndetermination of liability concerning any Third Party Claim without prior
\nwritten approval by the Indemnitee if the terms or conditions of such
\ncompromise, settlement or consent would, in the reasonable judgment of the
\nIndemnitee, have a significantly adverse financial impact or an adverse effect
\nupon the ongoing operations of the Indemnitee. Notwithstanding any other
\nprovision of this Section 6.3, unless otherwise agreed to by the parties in
\nwriting, no party shall enter into any compromise or settlement or consent to
\nthe entry of any judgment which does not include as an unconditional term
\nthereof the giving by the third party of a release of both the Indemnitee and
\nthe Indemnifying Party from all further liability concerning such Third Party
\nClaim.<\/p>\n
(d) In the event that counsel for both the defending
\nparty and the non-defending party is required and joint counsel cannot
\nadequately represent the interests of both the defending party and the
\nnon-defending party due to a conflict of interest, the non-defending party
\nshall have the right to participate in the defense of any Third Party Claim by
\nemploying separate counsel at the expense of such non-defending party without a
\nright of reimbursement from the defending party. In addition, in all cases, the
\nnon-defending party may participate in the defending party’s defense of any
\nThird Party Claim in which the non-defending party has any interest by employing
\nseparate counsel; provided, however, that (i) the defending party shall control,
\nmanage and direct the defense of such Third Party Claim and (ii) the
\nnon-defending party’s participation shall be at the non-defending party’s cost
\nand expense without a right of reimbursement from the defending party.<\/p>\n
(e) If the party having the right to elect to defend
\na particular Third Party Claim pursuant to Section 6.3(b) elects not to defend,
\nor fails to respond regarding its election to defend in a timely manner, a
\nparticular Third Party Claim, the other party shall defend such Third Party
\nClaim without any prejudice to its rights to indemnification from the
\nIndemnifying Party pursuant to this Article VI. In such case, (i) the Indemnitee
\nshall have the right to compromise, settle or consent to the entry of any
\njudgment with respect to such Third Party Claim as provided in Section 6.3(c),
\n(ii) the amount of such compromise, settlement or judgment shall be<\/p>\n
53
\n 60
\ndeterminative of the amount of the Loss (but such compromise, settlement or
\njudgment shall not necessarily be determinative of which party hereunder is
\nentitled to indemnification) and (iii) the Indemnifying Party shall bear all
\ncosts and expenses of defending such Third Party Claim; provided, however, that
\nif both parties may be Indemnifying Parties with respect to such Third Party
\nClaim, the non-defending party shall reimburse the defending party promptly upon
\ndemand by the defending party for the non-defending party’s proportionate share
\nof all out-of-pocket costs and expenses reasonably incurred in connection with
\nthe defending party’s defense of such Third Party Claim.<\/p>\n
(f) The non-defending party shall make available to
\nthe defending party and its counsel all employees, books and records,
\ncommunications, documents, items or matters within its knowledge, possession or
\ncontrol that are necessary, appropriate or reasonably deemed relevant by the
\ndefending party with respect to such defense; provided, however, that subject to
\nSection 8.6 hereof, nothing in this subparagraph (f) shall be deemed to require
\na party to make available books and records, communications, documents or items
\nwhich (i) in such party’s good faith judgment could result in a waiver of any
\nPrivilege or (ii) such party is not permitted to make available because of any
\nLaw or any confidentiality obligation to a third party, in which case such party
\nshall use its reasonable efforts to seek a waiver of or other relief from such
\nconfidentiality restriction.<\/p>\n
(g) Upon final judgment, determination, settlement or
\ncompromise of any Third Party Claim, and unless otherwise agreed by the parties
\nin writing, the Indemnifying Party shall pay promptly on behalf of the
\nIndemnitee, or to the Indemnitee in reimbursement of any amount theretofore
\nrequired to be paid by it, the amount of any and all Losses suffered by such
\nIndemnitee (other than attorneys’ fees incurred by such Indemnitee in the event
\nit participates in its own defense, except in the circumstance where the
\nIndemnifying Party has failed to assume the defense of any Third Party Claim)
\nwith respect to such claim as determined by such final judgment, determination,
\nsettlement or compromise. Upon the payment in full by the Indemnifying Party of
\nsuch amount, such Indemnifying Party shall be subrogated to and shall stand in
\nthe place of such Indemnitee as to any events or circumstances in respect of
\nwhich such Indemnitee may have any right or claim relating to such Third Party
\nClaim. Such Indemnitee shall cooperate with such Indemnifying Party in a
\nreasonable manner, and at the cost and expense of such Indemnifying Party, in
\nprosecuting any subrogated right or claim.<\/p>\n
Section 6.4 Other Claims for Indemnification. Any claim on
\naccount of a Loss which does not result from a Third Party Claim shall be
\nasserted<\/p>\n
54
\n 61
\nby written notice from the Indemnitee to the Indemnifying Party stating the
\nspecific provisions of this Agreement upon which such claim is based. Such
\nIndemnifying Party shall have a period of 30 days from actual receipt of the
\nnotice (or such shorter time period as may be required by law as indicated by
\nthe Indemnitee in the written notice) within which to respond thereto. If such
\nIndemnifying Party does not respond within such 30-day (or lesser) period, then
\nthere shall be a rebuttable presumption that such Indemnifying Party has
\naccepted responsibility for such claim. If such Indemnifying Party does respond
\nwithin such 30-day (or lesser) period and rejects such claim in whole or in
\npart, such Indemnitee shall be free to pursue resolution as provided in Article
\nXIII hereof.<\/p>\n
Section 6.5 Contribution. If the indemnification provided for
\nin Section 6.2 is unavailable to an Indemnitee in respect of any Loss arising
\nout of or related to information contained in the Registration Statement as
\nprovided in clause (ii) of Section 6.2(a) and clause (ii) of Section 6.2(b),
\nthen the Indemnifying Party, in lieu of indemnifying such Indemnitee, shall
\ncontribute to the amount paid or payable by such Indemnitee as a result of such
\nLoss, in such proportion as is appropriate to reflect the relative fault of
\nConoco and each other Conoco Party, on the one hand, and DuPont and each other
\nDuPont Party, on the other hand, in connection with the statements or omissions
\nwhich resulted in such Loss. The relative fault of a Conoco Party, on the one
\nhand, and of a DuPont Party, on the other hand, shall be determined by reference
\nto, among other things, whether the untrue or alleged untrue statement of a
\nmaterial fact or the omission or alleged omission to state a material fact
\nrelates to information supplied by a Conoco Party or a DuPont Party.<\/p>\n
Section 6.6 No Beneficiaries. Except to the extent expressly
\nprovided otherwise in this Article VI, the indemnification provided for by this
\nArticle VI shall not inure to the benefit of any third party or parties and
\nshall not relieve any insurer who would otherwise be obligated to pay any claim
\nof the responsibility with respect thereto or, solely by virtue of the
\nindemnification provisions hereof, provide any subrogation rights with respect
\nthereto and each party agrees to waive (and, as applicable, cause its
\nSubsidiaries to waive) such rights against the other (and, as applicable, its
\nSubsidiaries) to the fullest extent permitted by law.<\/p>\n
Section 6.7 Indemnification of Directors and Officers. For
\npurposes of this Article VI, and notwithstanding anything to the contrary
\ncontained herein, (i) officers of DuPont shall not be Conoco Parties, but shall
\nbe deemed DuPont Parties, whether or not such officers of DuPont serve on the
\nConoco Board, (ii) officers of Conoco shall not be deemed DuPont Parties, but
\nshall be deemed Conoco Parties,<\/p>\n
55
\n 62
\nwhether or not such officers of Conoco serve on
\nthe DuPont Board, and (iii) Persons who (A) serve on both the Conoco Board and
\nthe DuPont Board and (B) are not officers of either DuPont or Conoco, shall be
\ndeemed both DuPont Parties and Conoco Parties.<\/p>\n
ARTICLE VII<\/p>\n
CERTAIN ADDITIONAL MATTERS<\/p>\n
Section 7.0 Post-Closing Transactions. As more fully set forth
\nin Sections 7.1 and 7.2 below, and subject to the limitations therein, the
\nparties hereto intend to effect the Separation, including all required transfers
\nof any Transferred Business Companies, Transferred Assets and DuPont Transferred
\nAssets on or prior to the Effective Date or, to the extent any approvals,
\nfilings or consents are required with or from any Governmental Authorities or
\nthird parties or otherwise contemplated by the parties in connection with the
\nRestructuring, as soon as practicable thereafter. In the case of any such
\ntransfers not complete at the Effective Date, the parties further intend,
\nsubject to the provisions of Sections 7.1 and 7.2 below, to treat the Person to
\nwhom such Asset or company would otherwise have been transferred, insofar as is
\nreasonably possible, as being entitled to all of the benefits and burdens
\nrelating thereto, including possession, use, risk of loss, potential for gain
\nand control, from and after the Effective Date.<\/p>\n
Section 7.1 Non Assignment, Further Assurances. (a)
\nNotwithstanding anything else in this Agreement to the contrary, this Agreement
\nshall not constitute an agreement to assign, convey or transfer any Action,
\nAsset or Contract, including stock or other ownership interests in a Transferred
\nBusiness Company or any claim or right or any benefit arising thereunder or
\nresulting therefrom as to which consent or approval to assignment, conveyance or
\ntransfer thereof or amendment thereof (including, but not limited to, consents
\nand approvals of Governmental Authorities) is required but has not been obtained
\nas of the Effective Date unless and until such consent is no longer required or
\nhas been obtained.<\/p>\n
(b) Subject to Section 7.2, DuPont and Conoco agree
\nthat they will use their respective reasonable commercial efforts to obtain any
\nconsent, approval or amendment (including, but not limited to, consents and
\napprovals of Governmental Authorities) required to (i) convey, assign, transfer
\nand deliver to Conoco or the applicable Transferred Business Companies all of
\nDuPont’s or the applicable Retained Subsidiaries’ title and ownership interest
\nin and to the Trans-<\/p>\n
56
\n 63
\nferred Assets and to convey, assign, transfer and deliver to DuPont or the
\napplicable Retained Subsidiaries all of Conoco’s or its applicable Subsidiaries’
\nor any Delayed Company’s title and ownership interest in and to any DuPont
\nTransferred Assets to be conveyed to DuPont or the Retained Subsidiaries
\nhereunder and (ii) have Conoco or its applicable Subsidiary assume, pay, perform
\nand discharge the Assumed Liabilities and to obtain the release of DuPont or the
\napplicable Retained Subsidiary therefrom, and, to the extent required, have
\nDuPont or its applicable Retained Subsidiary assume, pay, perform and discharge
\nthe Retained Liabilities and to obtain the release of Conoco or its applicable
\nSubsidiary therefrom including with respect to (i) and (ii) any consent,
\napproval or amendment required for any necessary novation or assignment of all
\nContracts, agreements, leases, licenses and other rights of any nature
\nwhatsoever relating to any Assets (including, without limitation, all bids,
\nquotations and proposals which have been made by DuPont or any of the Retained
\nSubsidiaries on behalf of the Transferred Business or by Conoco or any
\nTransferred Business Company on behalf of the Retained Business which are
\noutstanding as of the Effective Date); provided, however, that neither DuPont
\nand the Retained Subsidiaries nor Conoco and its Subsidiaries shall be obligated
\nto pay any consideration in order to obtain any such consent, approval or
\namendment (except that DuPont shall be required to pay filing fees, other
\nadministrative charges and other reasonable out-of-pocket expenses to the extent
\nthey are Separation Expenses); and provided, further, however, that neither
\nDuPont nor Conoco is, in this Agreement or in any Related Agreement,
\nrepresenting or warranting in any way that the obtaining of the consents or
\napprovals, the execution and delivery of any amendatory agreements and the
\nmaking of the filings and applications contemplated by this Agreement shall
\nsatisfy the provisions of all applicable agreements or the requirements of all
\napplicable laws or judgments; and provided, further, that Conoco and any
\napplicable Subsidiary shall bear the economic and legal risk that any required
\nconsents, approvals or amendments are not obtained or that any requirements of
\nlaw or judgments are not complied with, with respect to the transfer of the
\nTransferred Assets and that DuPont and any applicable Retained Subsidiary shall
\nbear the economic and legal risk that any required consents, approvals or
\namendments are not obtained or that any requirements of law or judgments are not
\ncomplied with, with respect to DuPont Transferred Assets.<\/p>\n
(c) In the event and to the extent that DuPont is
\nunable to obtain any such required consent, approval or amendment required to
\ntransfer, convey or assign the Transferred Assets (other than the stock of a
\nDelayed Company) to Conoco or one of its Subsidiaries, DuPont shall, and shall
\ncause the Retained Subsidiaries to, continue to hold and, to the extent required
\nby the terms applicable to such Asset, operate the Asset in the case of real or
\npersonal property or to be bound<\/p>\n
57
\n 64
\nthereby in the case of Contracts and unless not permitted by law, Conoco shall,
\nand shall cause its Subsidiaries to, pay, perform and discharge fully, promptly
\nwhen due all the obligations of DuPont or the Retained Subsidiaries thereunder
\nfrom and after the Effective Date, and Conoco shall, and shall cause its
\nSubsidiaries to, indemnify the DuPont Parties for all Losses arising out of such
\nperformance by Conoco or any of its Subsidiaries. DuPont shall, and shall cause
\nthe Retained Subsidiaries to, without further consideration therefor, pay and
\nremit to Conoco promptly all monies, rights and other considerations received in
\nrespect of such performance. Conoco shall, and shall cause its Subsidiaries to,
\nindemnify the DuPont Parties for all Losses arising out of any actions (or
\nomissions to act) of DuPont or any Retained Subsidiary (i) taken at the
\ndirection of Conoco (or if Conoco fails to provide such direction) or (ii)
\nabsent gross negligence or willful misconduct, taken at the initiative of DuPont
\nor one of the Retained Subsidiaries with respect to any Contracts, agreements,
\nleases, licenses, or other rights or commitments.<\/p>\n
(d) In the event and to the extent that Conoco is
\nunable to obtain any such required consent, approval or amendment required to
\ntransfer, convey or assign any DuPont Transferred Asset (other than the stock of
\na Delayed Company) to DuPont or one of the Retained Subsidiaries, Conoco shall,
\nand shall cause its Subsidiaries to, continue to hold and, to the extent
\nrequired by the terms applicable to such Asset, operate the Asset in the case of
\nreal or personal property or to be bound thereby in the case of Contracts and
\nunless not permitted by law, DuPont shall, and shall cause the Retained
\nSubsidiaries to, pay, perform and discharge fully, promptly when due all the
\nobligations of Conoco or its Subsidiaries thereunder from and after the
\nEffective Date, and DuPont shall, and shall cause the Retained Subsidiaries to,
\nindemnify the Conoco Parties for all Losses arising out of such performance by
\nDuPont or any of the Retained Subsidiaries. Conoco shall, and shall cause its
\nSubsidiaries to, without further consideration therefor, pay and remit to DuPont
\npromptly all monies, rights and other considerations received in respect of such
\nperformance. DuPont shall, and shall cause the Retained Subsidiaries to,
\nindemnify the Conoco Parties for all Losses arising out of any actions (or
\nomissions to act) of Conoco or any of its Subsidiaries (i) taken at the
\ndirection of DuPont (or if DuPont fails to provide such direction) or (ii)
\nabsent gross negligence or willful misconduct, taken at the initiative of Conoco
\nor one of its Subsidiaries with respect to any Contracts, agreements, leases,
\nlicenses, or other rights or commitments.<\/p>\n
(e) Subject to Section 7.2, to the extent that any
\nconveyances, assignments, transfers and deliveries of the Assets contemplated by
\nthis Agreement or the Related Agreements shall not have been consummated on or
\nprior to the Effective Date (including, but not limited to, the failure or
\ninability to obtain a<\/p>\n
58
\n 65
\nrequired approval, consent or amendment), DuPont and Conoco shall cooperate to
\neffect such consummation as promptly thereafter as shall be practicable. Without
\nlimiting the generality of the foregoing, at any time and from time to time
\nafter the Effective Date, at the request of DuPont or Conoco, as the case may
\nbe, and without further consideration, DuPont or the Retained Subsidiaries, on
\nthe one hand, and Conoco or its Subsidiaries, on the other hand, will execute
\nand deliver to DuPont or the Retained Subsidiaries, as the case may be, or to
\nConoco or its Subsidiaries, as the case may be, such other instruments of
\ntransfer, conveyance, assignment and confirmation and take such action as DuPont
\nor Conoco, as the case may be, may reasonably deem necessary or desirable in
\norder to more effectively transfer, convey and assign to the other and to
\nconfirm in the other all title and ownership interest held by the transferor to
\nall of the Assets transferred hereunder, to put the transferee in actual
\npossession and operating control thereof and to permit the transferee to
\nexercise all ownership rights with respect thereto held by the transferor
\n(including, without limitation, rights under Contracts and other arrangements as
\nto which the consent of any third party to the transfer thereof shall not have
\npreviously been obtained) and Conoco or its Subsidiaries and DuPont or the
\nRetained Subsidiaries will execute and deliver to DuPont or Conoco, as the case
\nmay be, all instruments, undertakings or other documents and take such other
\naction as DuPont and Conoco may reasonably deem necessary or desirable in order
\nto have Conoco or one of the Transferred Business Companies fully assume and
\ndischarge the Assumed Liabilities and relieve DuPont of any Liability with
\nrespect thereto and to have DuPont or the Retained Subsidiaries, to the extent
\nnecessary, to fully assume and discharge the Retained Liabilities and relieve
\nConoco of any Liability with respect thereto; provided, that both DuPont and
\nConoco understand and agree that, neither shall be liable in any manner to any
\nperson who is not a party to this Agreement for any failure of any of the
\ntransfers contemplated by this Agreement to be consummated on or subsequent to
\nthe Effective Date. Notwithstanding the foregoing, DuPont and Conoco shall not
\nbe obligated, in connection with the foregoing, to expend monies other than
\nfiling fees, administrative charges, and other reasonable out-of-pocket
\nexpenses, which shall be borne by DuPont to the extent they are Separation
\nExpenses.<\/p>\n
(f) Whether or not all of the Transferred Assets or
\nthe Assumed Liabilities shall have been legally transferred or transferred of
\nrecord to or assumed by Conoco or one of the Transferred Business Companies or
\nwhether all of the Assets to be transferred to DuPont or one of the Retained
\nSubsidiaries or the Retained Liabilities shall have been legally transferred or
\ntransferred of record to or assumed by DuPont or one of the Retained
\nSubsidiaries as of the Effective Date, DuPont and Conoco agree that as between
\nDuPont and Conoco and their respective<\/p>\n
59
\n 66
\nSubsidiaries, as of the Effective Date, (i) Conoco or one of the Transferred
\nBusiness Companies shall have, and shall be deemed to have acquired, complete
\nand sole beneficial ownership over all of the Transferred Assets, except as
\ndescribed in this Section 7.1 with respect to Assets which are non-assignable
\nand as described in Section 7.2 with respect to Delayed Companies, together with
\nall of DuPont’s and the Retained Subsidiaries’ rights, powers and privileges
\n(except as provided in Section 8.6 hereto) incident thereto, and shall be deemed
\nto have assumed in accordance with the terms of this Agreement all of the
\nAssumed Liabilities and all of DuPont’s and the Retained Subsidiaries’ duties,
\nobligations and responsibilities incident thereto and (ii) DuPont or one of the
\nRetained Subsidiaries shall have, and shall be deemed to have acquired, complete
\nand sole beneficial ownership over all of the DuPont Transferred Assets to be
\ntransferred to DuPont and the Retained Subsidiaries hereunder, except as
\ndescribed in this Section 7.1 with respect to Assets which are non-assignable
\nand except as described in Section 7.2 with respect to Delayed Companies,
\ntogether with all of Conoco’s and its Subsidiaries’ rights, powers and
\nprivileges (except as provided in Section 8.6 hereto) incident thereto, and
\nshall be deemed to have assumed, to the extent required, in accordance with the
\nterms of this Agreement all of the Retained Liabilities and all of Conoco’s and
\nits Subsidiaries’ duties, obligations and responsibilities incident thereto.<\/p>\n
Section 7.2 Delayed Companies; Interim Period.<\/p>\n
(a) With respect to any Transferred Business Company
\nnot owned directly or indirectly by Conoco as of the Effective Date, including,
\nbut not limited to, the entities set forth on Schedule 7.2 (each a “Delayed
\nCompany”), DuPont and Conoco agree that from the Effective Date until it is
\nconveyed to Conoco or any of its Subsidiaries (or until it is otherwise
\ntransferred by DuPont pursuant to paragraph (e) hereof) (the “Interim Period”),
\nDuPont, or each Retained Subsidiary of DuPont that directly or indirectly owns a
\nDelayed Company, shall retain title to the Delayed Company; provided, that it
\nmay transfer the Delayed Company to another Retained Subsidiary that is wholly
\nowned, directly or indirectly, by DuPont. For the period specified in clauses
\n(i) and (ii) of the first sentence of subsection (d) below and until the sale
\nprocess provided for therein has been completed or abandoned, DuPont shall cause
\neach Delayed Company not to declare or pay any dividends or other distributions,
\nexcept out of net cash flow generated by the Retained Business, to DuPont or any
\nRetained Subsidiary or any other Person and shall cause the Delayed Companies
\nnot to redeem, repurchase or otherwise acquire any of its capital stock;
\nprovided, however, that the provisions of this sentence shall terminate and be
\nof no further effect with respect to a particular Delayed Company at such time
\nas that particular Delayed Company is no longer a direct or indirect wholly<\/p>\n
60
\n 67
\nowned Subsidiary of DuPont. Conoco, directly or indirectly, shall provide the
\nfunding requirements (which shall include an allocable portion of corporate
\noverhead and non-allocated expenses) of the portion of the business and
\noperations of each Delayed Company conducting the Transferred Business not
\ncovered by cash on hand at such Delayed Company in amounts and at times
\ndetermined by DuPont and shall repay and indemnify DuPont or any Retained
\nSubsidiary for any such funding advanced by it to fund the portion of the
\nbusiness and operations of the Delayed Company conducting the Transferred
\nBusiness after the Effective Date; provided, that in the case of any Mixed-Use
\nSubsidiary which is a Delayed Company, the calculation of the funding required
\nto be provided by Conoco shall be adjusted to (i) reimburse DuPont or a Retained
\nSubsidiary for the funding provided by cash generated by the business and
\noperations of such Delayed Company through the conduct of the Retained Business
\nand for any funding of such Delayed Company provided by DuPont or any Retained
\nSubsidiary or otherwise generated by the Retained Business and (ii) reimburse
\nConoco or any Subsidiary of Conoco for the funding, if any, of that portion of
\nthe business and operations of the Delayed Company conducting the Retained
\nBusiness after the Effective Date which is provided by cash generated by the
\nbusiness and operations of such Delayed Company conducting the Transferred
\nBusiness.<\/p>\n
(b) Prior to the receipt of the approvals of all
\nGovernmental Authorities required to transfer a Delayed Company to Conoco or any
\nof its Subsidiaries, if applicable, during the Interim Period, management of
\nsuch Delayed Company shall operate such Delayed Company without control by
\nConoco or any of its Subsidiaries, and DuPont shall instruct the management of
\nsuch Delayed Company to operate such Delayed Company in the ordinary course of
\nbusiness in accordance with existing plans and budgets of such Delayed Company.
\nIf the exercise of managerial control by Conoco is not prohibited by law, Conoco
\nshall exercise managerial control over such portion of the business and
\noperations of each Delayed Company which conducts the Transferred Business and
\nneither DuPont nor any Retained Subsidiary shall have any duty or obligation
\nwith respect thereto. DuPont and its Subsidiaries shall (i) not be liable in any
\nmanner for the activities or operations of such portion of the business and
\noperations of each Delayed Company which conducts the Transferred Business or
\nthe activities of the directors, officers and employees of any Delayed Company
\nduring the Interim Period to the extent such activities relate to such portion
\nof the business and operations of the Delayed Company which conducts the
\nTransferred Business and (ii) shall be indemnified by Conoco and its
\nSubsidiaries from any and all Losses sustained by DuPont or any of the Retained
\nSubsidiaries in connection with the activities described under (i) above<\/p>\n
61
\n 68
\nor otherwise attributable to DuPont or any Retained Subsidiary with respect to
\nits status as holder of the shares of such Delayed Company during the Interim
\nPeriod.<\/p>\n
(c) DuPont shall, during the Interim Period, provide,
\nor cause to be provided, outsourcing services to a Delayed Company to the extent
\nsuch services are currently provided to such Delayed Company by DuPont or any
\nRetained Subsidiary. Such services shall be provided in accordance with the
\nterms and at the cost provided for in the relevant Transitional Services
\nAgreement. A Delayed Company or any Transferred Business Companies, as the case
\nmay be, shall be deemed to have been granted licenses immediately prior to or on
\nthe Effective Date by DuPont or any Retained Subsidiary, any Delayed Company and
\nConoco or any of its Subsidiaries, as the case may be, to use all intellectual
\nproperty owned or licensed (in the case of licensed intellectual property,
\nsubject to the terms thereof) by such grantor and previously used in connection
\nwith the recipient’s business and on the same terms and conditions that such
\nintellectual property was licensed or made available to the recipient prior to
\nthe Effective Date.<\/p>\n
(d) If all or part of the transfer of a Delayed
\nCompany is prohibited by a Governmental Authority, DuPont shall, for a period
\nending on the the later of (i) two years following the Effective Date or (ii)
\none year following DuPont’s good faith determination that such prohibition
\nexists and a waiver or other relief therefrom cannot be obtained on a
\ncommercially reasonable basis, with the consent of Conoco (which consent shall
\nnot be unreasonably withheld), use its reasonable commercial efforts to
\ntransfer, or cause to be transferred, to a third party all of the Assets and
\nLiabilities of such Delayed Company relating to the operations and conduct of
\nthe Transferred Business (if none of such Assets and Liabilities could be
\ntransferred to or assumed by Conoco) or the portion of such Assets and
\nLiabilities that could not be transferred to Conoco on terms reasonably
\nacceptable to Conoco; provided, that DuPont shall be entitled to comply with and
\nto rely upon any advice, orders or instructions of a Governmental Authority with
\nrespect to any such transfer or sale; and further, provided, that any such
\ntransfer or sale shall be made without any undertakings on the part of DuPont or
\nany Retained Subsidiary, but that DuPont shall bear all costs, expenses and
\ntaxes arising from the sale or transfer of such Assets and Liabilities; and
\nfurther, provided, that DuPont shall keep Conoco reasonably informed about its
\nefforts to cause such sale or transfer and DuPont shall consider, but have no
\nobligation to implement, any recommendations Conoco may have regarding such
\nprocess. Following the later to occur of (i) and (ii) above, DuPont shall have
\nno further obligation to effectuate or cause any sale or transfer pursuant to
\nthis Section 7.2(d). Upon such sale or transfer, all duties and obligations<\/p>\n
62
\n 69
\nof DuPont or any Retained Subsidiary with respect to such Delayed Company shall
\nthereupon cease except as otherwise provided in this Agreement. The proceeds to
\nDuPont, the relevant Retained Subsidiary or the relevant Delayed Company (net of
\nany costs, expenses and taxes, including any required repayments of debt, to the
\nextent they are not Separation Expenses, (the “Net Proceeds”)), if any, of such
\ntransfer or sale shall be remitted to Conoco upon receipt of such Net Proceeds
\nby DuPont, the relevant Retained Subsidiary or the relevant Delayed Company.
\nHowever, if DuPont or the relevant Retained Subsidiary is required to make an
\nexpenditure in connection with such sale or transfer that is not a Separation
\nExpense, Conoco shall, promptly following the consummation of such transfer or
\nsale, reimburse DuPont or the relevant Retained Subsidiary for the full amount
\nof such expenditure. If, following the later to occur of clause (i) and (ii)
\nabove (or earlier, with the consent of Conoco), DuPont or the relevant Retained
\nSubsidiary liquidates such Delayed Company, the Net Proceeds of such liquidation
\nshall, if permitted by Law, be remitted to Conoco upon receipt of such Net
\nProceeds by DuPont or the relevant Retained Subsidiary. The payments provided
\nfor in the previous two sentences shall be made subject to any currency, or
\nexchange or other regulation or requirement of Governmental Authorities.
\nNotwithstanding the foregoing, if a Delayed Company is a Mixed-Use Subsidiary,
\nDuPont may (i) transfer all Assets of the Delayed Company which constitute part
\nof the Retained Business to DuPont or one of the Retained Subsidiaries prior to
\nany sale of all or part of such Delayed Company to a third party or a
\nliquidation of the Delayed Company, (ii) sell only the Assets of the Delayed
\nCompany which constitute part of the Transferred Business to a third party or
\n(iii) sell all of the Assets of the Delayed Company or all of the stock of the
\nDelayed Company, in which case, DuPont shall only remit to Conoco the Net
\nProceeds which are allocable to the portion of the Delayed Company which
\nconducted the Transferred Business. In the case of clauses (i) and (ii) above,
\nthe amount of Net Proceeds to be remitted by DuPont to Conoco shall be
\ncalculated after giving effect to the transfer of the Assets of the Delayed
\nCompany which constitute part of the Retained Business in the case of clause
\n(i), and only giving effect to the sale of the Assets of the Delayed Company
\nwhich constitute part of the Transferred Business in the case of Clause (ii).<\/p>\n
(e) During the Interim Period, DuPont or one of the
\nRetained Subsidiaries will promptly provide Conoco and its Subsidiaries with
\nsuch financial and other information with respect to such portion of the
\nbusiness and operations of each Delayed Company which conducts the Conoco
\nBusiness as may be reasonably requested by Conoco, unless the provision of such
\ninformation would be prohibited by applicable law or by contractual obligations
\nto third parties in the reasonable judgment of DuPont. During the Interim
\nPeriod, DuPont and Conoco will, and will<\/p>\n
63
\n 70
\ncause their respective Subsidiaries to, cooperate and to use commercially
\nreasonable efforts to obtain all required approvals of any Governmental
\nAuthorities for any sale or transfer of Assets and assumptions of Liabilities of
\nany Delayed Company relating to the operations and conduct of the Conoco
\nBusiness.<\/p>\n
(f) In the event that any Delayed Company which is
\nalso a Mixed-Use Subsidiary that is conveyed to Conoco or any of its
\nSubsidiaries owns any DuPont Transferred Assets after such conveyance, Conoco
\nand its Subsidiaries shall continue to operate such assets and conduct that
\nportion of the Retained Business attributable to those Assets in the ordinary
\ncourse of business. Conoco and its appropriate Subsidiaries shall take all
\nactions reasonably required to transfer such DuPont Transferred Assets to DuPont
\nor the appropriate Retained Subsidiary as soon as is practicable following
\nreceipt of all required approvals of all Governmental Authorities. The
\nprovisions of Section 7.2(a), (b), (c), and (e) shall apply to DuPont and the
\nRetained Subsidiaries, such DuPont Transferred Assets and the conduct of that
\nportion of the Retained Business conducted by such Delayed Company attributable
\nto those Assets to the same extent such provisions are applicable to Conoco and
\nits Subsidiaries, the Transferred Assets and the operation of the Conoco
\nBusiness pursuant to such subsections. No later than 30 days following receipt
\nby Conoco or any of its Subsidiaries of any cash proceeds in respect of the sale
\nor transfer of any DuPont Transferred Assets pursuant to this subsection 7.2(f),
\nConoco shall remit to DEC an amount of cash equal to the gross proceeds received
\nby Conoco or any of its Subsidiaries pursuant to such sale or transfer.<\/p>\n
Section 7.3 Notice of Separation. Following the Effective
\nDate, Conoco shall, and shall cause its Subsidiaries to use commercially
\nreasonable efforts to advise and put on notice all third parties with whom
\nConoco or any of its Subsidiaries conducts business or maintains contractual
\nrelationships that Conoco is an independent public company and no longer a
\nwholly owned Subsidiary of DuPont.<\/p>\n
Section 7.4 Resignations. On or prior to the Effective Date,
\nDuPont shall cause all directors, officers and employees of DuPont who are
\ndirectors and officers of any Transferred Business Company (other than any named
\nin the Registration Statement as intended to be directors or officers of Conoco
\nor any other Transferred Business Company) to resign from such positions with
\nsuch Transferred Business Company, and Conoco shall cause all persons who are or
\nwill be Transferred Employees and who are officers or employees of DuPont or
\nofficers, employees, or directors of any Retained Subsidiary (other than
\nSentinel) to resign from such positions with DuPont or with such Retained
\nSubsidiary; provided however, that no<\/p>\n
64
\n 71
\nperson who is named in the Registration Statement as being or intended to be or
\nremain a director of Conoco or DuPont shall be required to resign from such
\nBoard.<\/p>\n
Section 7.5 Other Agreements. On or prior to Effective Date,
\nDuPont and Conoco shall, and shall cause their respective Subsidiaries (as
\nappropriate) to, enter into and deliver the Related Agreements and the
\nConveyancing and Assumption Instruments.<\/p>\n
Section 7.6 Payment of Separation Expenses. DuPont shall be
\nresponsible for reimbursing Conoco for Separation Expenses incurred by Conoco
\nand its Subsidiaries in accordance with the following provisions:<\/p>\n
(a) Within 30 business days following the Effective
\nDate, Conoco shall prepare, and DuPont shall fully cooperate in preparing, an
\ninvoice reflecting all Separation Expenses paid by Conoco or any of its
\nSubsidiaries for the period beginning May 11, 1998 through and including the
\nEffective Date. Not later than 30 business days following delivery of such
\ninvoice, DuPont shall, or shall cause any of the Retained Subsidiaries to, pay
\nto Conoco or any of its Subsidiaries in cash the amount of Separation Expenses
\nreflected on such invoice.<\/p>\n
(b) For each calendar month (or for such other time
\nperiod as the parties shall mutually agree following the Effective Date)
\ncommencing with the month following the month in which the Effective Date occurs
\nand, unless sooner terminated by mutual agreement of the parties hereto,
\ncontinuing for two years from the date on which DuPont’s voting power falls
\nbelow 50% of the voting power of all of the outstanding shares of common stock
\nof Conoco, within 30 business days of the end of the month (or such other
\nrelevant period) in question, Conoco shall prepare, and DuPont shall fully
\ncooperate in preparing, an invoice which shall reflect the Separation Expenses
\npaid by Conoco and its Subsidiaries during the month (or such other relevant
\nperiod) in question; provided that, with respect to the first such period, such
\ninvoice shall not reflect Separation Expenses paid prior to or on the Effective
\nDate (which expenses shall be reflected on the invoice provided for under
\nsubsection (a) above). Not later than 30 business days following delivery of
\neach such periodic invoice, DuPont shall, or shall cause any of the Retained
\nSubsidiaries to pay in cash the amount reflected on such periodic invoice.<\/p>\n
(c) As promptly as practicable following the date of
\nthis Agreement, Conoco shall provide DuPont with an estimate of the total amount
\nof Separation Expenses for which reimbursement is to be provided pursuant to the
\nforegoing provisions.<\/p>\n
65
\n 72
\n Section 7.7 Signs; Use of Company Name. Except as provided in
\nSection 7.8, as soon as practicable, and in any event within 60 days after the
\nEffective Date, DuPont and Conoco, at DuPont’s expense, shall remove (or, if
\nnecessary, on an interim basis cover up) any and all exterior and interior signs
\nand identifiers which refer or pertain to DuPont or the Retained Business on the
\nTransferred Assets, in the case of Conoco, or which refer to or pertain to
\nConoco or the Transferred Business on the Assets of DuPont or the Retained
\nSubsidiaries, in the case of DuPont (in each case, other than on the Assets of
\nany Delayed Company for so long as such company remains a Delayed Company).
\nAfter such period, (i) Conoco shall not use or display the name “DuPont” or
\nvariations thereof, or other trademarks, tradenames, logos or identifiers using
\nsuch name or otherwise owned by or licensed to DuPont which have not been
\nassigned or licensed to Conoco and (ii) DuPont shall not use or display the name
\n“Conoco” or variations thereof, or other trademarks, tradenames, logos or
\nidentifiers using such name or otherwise owned by or licensed to Conoco which
\nhave not been assigned or licensed to DuPont (collectively, in each case,
\n“Non-Permitted Names”), without the prior written consent of the other;
\nprovided, however, notwithstanding the foregoing, that nothing contained in this
\nAgreement shall prevent DuPont or Conoco from using the other’s name in public
\nfilings with Governmental Authorities, materials intended for distribution to
\neither party’s stockholders or any other communication in any medium which
\ndescribes the relationship between the parties.<\/p>\n
Section 7.8 Products, Supplies and Documents. DuPont and
\nConoco shall have the right to use existing products, supplies and documents
\n(including, but not limited to, purchase orders, forms, labels, shipping
\nmaterials, catalogues, sales brochures, operating manuals, instructional
\ndocuments and similar materials, and advertising material) being transferred to
\nit pursuant to this Agreement which have imprinted thereon or otherwise use a
\nNon-Permitted Name, for a period not to exceed 180 days following the Effective
\nDate (or for such longer period as necessary to fulfill existing contractual
\nrelationships under contracts which have not been novated or in the business and
\noperations of any Delayed Company for so long as such company remains a Delayed
\nCompany); provided, however, that DuPont and Conoco agree (i) to use only such
\nsupplies and documents existing in inventory as of the Effective Date and (ii)
\nnot to order or utilize in any manner any additional supplies and documents
\nwhich have imprinted thereon or otherwise use a Non-Permitted Name.<\/p>\n
Section 7.9 Plant Closings and Layoffs. Conoco agrees that it
\nshall not, and shall not permit any of its Subsidiaries, at any time during the
\n120-day period following the Effective Date, effectuate (i) a “plant closing” as
\ndefined in the<\/p>\n
66
\n 73
\nWorker Adjustment and Retraining Notification Act of 1988 (the “WARN Act”)
\naffecting any site of employment or operating units within any site of
\nemployment of the Transferred Business or (ii) take any action to precipitate a
\n“mass layoff” as defined in the WARN Act affecting any site of employment of the
\nTransferred Business, except, in either case, after complying fully with the
\nnotice and other requirements of the WARN Act. Conoco agrees to, and shall cause
\nits Subsidiaries to, indemnify DuPont and the Retained Subsidiaries and to
\ndefend and hold DuPont and the Retained Subsidiaries harmless from and against
\nany and all Losses which DuPont and the Retained Subsidiaries may incur in
\nconnection with any Action or claim of violation brought against DuPont and any
\nof the Retained Subsidiaries under the WARN Act or any state, local and foreign
\nplant closing and layoff law, which relate, in whole or in part, to actions
\ntaken by Conoco or any of its Subsidiaries with regard to any site of employment
\nof Conoco or any of its Subsidiaries or operating units within any site of
\nemployment of the Transferred Business.<\/p>\n
Section 7.10 Litigation. Following the Effective Date, (a)
\nConoco shall have exclusive authority and control over the investigation,
\nprosecution, defense and appeal of all pending Actions relating to or arising in
\nconnection with the Conoco Business, the Transferred Assets or the Assumed
\nLiabilities, including Actions with respect to the matters set forth on Schedule
\n7.10(a) (each, a “Conoco Action”), and may settle or compromise, or consent to
\nthe entry of any judgment with respect to any such Action, without the consent
\nof DuPont, and (b) DuPont shall have exclusive authority and control over the
\ninvestigation, prosecution, defense and appeal of all pending Actions relating
\nto or arising in connection with the DuPont Business, the Excluded Assets or the
\nRetained Liabilities, including Actions with respect to the matters set forth on
\nSchedule 7.10(b) (each, a “DuPont Action”), and may settle or compromise, or
\nconsent to the entry of any judgment with respect to, any such Action without
\nthe consent of Conoco; provided, that if both DuPont and Conoco are named as
\nparties to any Conoco Action or DuPont Action, to settle or compromise, or
\nconsent to the entry of any judgment with respect to, any such Action, DuPont,
\nany of the Retained Subsidiaries, Conoco and any of its Subsidiaries must comply
\nwith the provisions of Section 6.2. Conoco shall, and shall cause its
\nSubsidiaries to, indemnify, defend and hold harmless the DuPont Parties, and
\nDuPont shall, and shall cause the Retained Subsidiaries to, indemnify and hold
\nharmless each of the Conoco Parties, in the manner provided in Article VI, from
\nand against all Losses arising out of or resulting from each such Action over
\nwhich such Indemnifying Party has authority and control pursuant to this Section
\n7.10. Conoco shall, and shall cause its Subsidiaries, to use best efforts to
\nhave DuPont and any DuPont Parties removed as parties to any Conoco Action in
\nwhich they are named parties as soon as is reasonably practicable, and DuPont
\nshall, and shall cause the<\/p>\n
67
\n 74
\nRetained Subsidiaries to, use best efforts to have Conoco and any Conoco Parties
\nremoved as parties to any DuPont Action in which they are named parties as soon
\nas is reasonably practicable.<\/p>\n
Section 7.11 No Restrictions on Post-Closing Competitive
\nActivities; Corporate Opportunities.<\/p>\n
(a) It is the explicit intent of each of the parties
\nhereto that the provisions of this Agreement shall not include any
\nnon-competition or other similar restrictive arrangements with respect to the
\nrange of business activities which may be conducted by the parties hereto.
\nAccordingly, each of the parties hereto acknowledges and agrees that nothing set
\nforth in this Agreement shall be construed to create any explicit or implied
\nrestriction or other limitation on (i) the ability of any party hereto to engage
\nin any business or other activity which competes with the business of any other
\nparty hereto, or (ii) the ability of any party to engage in any specific line of
\nbusiness or engage in any business activity in any specific geographic area.<\/p>\n
(b) Except as provided in the Principal Related
\nAgreements, DuPont and the Retained Subsidiaries shall have the right to, and
\nshall have no duty not to, (i) engage in the same or similar business activities
\nor lines of business as Conoco and its Subsidiaries, (ii) do business with any
\nclient or customer of Conoco and its Subsidiaries and (iii) employ or otherwise
\nengage any officer or employee of Conoco and its Subsidiaries, and neither
\nDuPont nor any Retained Subsidiary nor any officer or director thereof shall be
\nliable to Conoco and its Subsidiaries or its stockholders for breach of any
\nfiduciary duty by reason of any such activities of DuPont or the Retained
\nSubsidiaries or of such person’s participation therein. Except as would
\notherwise result in a violation of law by DuPont or Conoco or any of their
\nrespective Subsidiaries, Conoco and any of its Subsidiaries shall have the right
\nto, and shall have no duty not to, (i) engage in the same of similar business
\nactivities or lines of business as DuPont and the Retained Subsidiaries (ii) do
\nbusiness with any client or customer of DuPont and the Retained Subsidiaries and
\n(iii) employ or otherwise engage any officer or employee of DuPont and Retained
\nSubsidiaries and neither Conoco nor any of its Subsidiaries nor officer or
\ndirector thereof shall be liable to DuPont and the Retained Subsidiaries or
\ntheir shareholders for breach of any fiduciary duty by reason of any such
\nactivities of Conoco or its Subsidiaries or of such persons participation
\ntherein. In the event that DuPont or any of the Retained Subsidiaries acquires
\nknowledge of a potential transaction or matter which may be a corporate
\nopportunity for both DuPont or any of the Retained Subsidiaries and Conoco and
\nany of its Subsidiaries, neither DuPont nor the Retained Subsidiaries nor any
\nDuPont Designee shall have any duty to communicate or present such corporate<\/p>\n
68
\n 75
\nopportunity to Conoco or its Subsidiaries and shall not be liable to Conoco and
\nits Subsidiaries or to Conoco’s stockholders for breach of any fiduciary duty as
\na stockholder of Conoco by reason of the fact that DuPont or any of the Retained
\nSubsidiaries pursues or acquires such corporate opportunity for itself, directs
\nsuch corporate opportunity to another person or entity, or does not present such
\ncorporate opportunity to Conoco and its Subsidiaries. In the event that Conoco
\nor any of its Subsidiaries acquires knowledge of a potential transaction or
\nmatter which may be a corporate opportunity for both DuPont or any of the
\nRetained Subsidiaries and Conoco or any of its Subsidiaries, neither Conoco nor
\nany of its Subsidiaries shall have any duty to communicate or present such
\ncorporate opportunity to DuPont or any of the Retained Subsidiaries and shall
\nnot be liable to DuPont or any of the Retained Subsidiaries or to DuPont’s
\nstockholders for breach of any fiduciary duty by reason of the fact that Conoco
\nor any of its Subsidiaries pursues or acquires such corporate opportunity for
\nitself, directs such corporate opportunity to another person or entity, or does
\nnot present such corporate opportunity to DuPont or any of the Retained
\nSubsidiaries. For the purposes of this Section 7.11, “corporate opportunities”
\nof Conoco and its Subsidiaries shall include, but not be limited to, business
\nopportunities which Conoco or its Subsidiaries are financially able to
\nundertake, which are, by their nature, in a line of business of Conoco or its
\nSubsidiaries, are of practical advantage to them and are ones in which Conoco or
\nits Subsidiaries have an interest or a reasonable expectancy, and in which, by
\nembracing the opportunities, the self-interest of DuPont or the Retained
\nSubsidiaries or any of their officers or directors will be brought into conflict
\nwith that of Conoco and its Subsidiaries, and “corporate opportunities” of
\nDuPont and the Retained Subsidiaries shall include, but not be limited to,
\nbusiness opportunities which DuPont or the Retained Subsidiaries are financially
\nable to undertake, which are, by their nature, in a line of business of DuPont
\nor the Retained Subsidiaries, are of practical advantage to them and are ones in
\nwhich DuPont or the Retained Subsidiaries have an interest or a reasonable
\nexpectancy, and in which, by embracing the opportunities, the self-interest of
\nConoco or its Subsidiaries or any of their officers or directors will be brought
\ninto conflict with that of DuPont and the Retained Subsidiaries.<\/p>\n
Section 7.12 Intellectual Property.<\/p>\n
(a) Conoco hereby grants to DuPont and the Retained
\nSubsidiaries, effective as of the Effective Time, a world-wide, irrevocable
\nimmunity from suit for infringement of all Conoco Patents used as of the
\nEffective Date by DuPont or any Retained Subsidiary in the operation of the
\nRetained Business; provided, however, that such immunity shall not extend to use
\nby DuPont or any Retained Subsidiary of any Conoco Patents for uses other than
\nuses for which such<\/p>\n
69
\n 76
\nConoco Patents are used by DuPont or any Retained Subsidiary as of the Effective
\nDate; and provided, further, that neither DuPont nor the Retained Subsidiaries
\nshall have the right to transfer or grant such immunity to a third party (other
\nthan a third party purchaser of substantially all of the business and Assets to
\nwhich immunities pertain).<\/p>\n
(b) DuPont hereby grants Conoco and the Transferred
\nBusiness Companies, effective as of the Effective Time, a world-wide,
\nirrevocable immunity from suit for infringement of all DuPont Patents used as of
\nthe Effective Date by Conoco or any Transferred Business Company in the
\noperation of the Transferred Business; provided, however, that such immunity
\nshall not extend to use by Conoco or any Transferred Business Company of any
\nDuPont Patents for uses other than uses for which such DuPont Patents are used
\nby Conoco or any Transferred Business Company as of the Effective Date; and
\nfurther, provided, however, that neither Conoco nor the Transferred Business
\nCompanies shall have the right to transfer or grant such immunity to a third
\nparty (other than a third party purchaser of substantially all of the business
\nand Assets to which immunities pertain).<\/p>\n
(c) The immunity from suit granted by this Section
\n7.12 shall extend for the period during which any DuPont Patents and Conoco
\nPatents respectively are in force and effect.<\/p>\n
ARTICLE VIII<\/p>\n
ACCESS TO INFORMATION AND SERVICES<\/p>\n
Section 8.1 Provision of Corporate Records. As soon as
\npracticable after the Effective Date, DuPont shall, subject to the provisions of
\nthis Section 8.1, use all reasonable commercial efforts to deliver or cause to
\nbe delivered to Conoco all Conoco Books and Records in the possession of DuPont
\nor any Retained Subsidiary and Conoco shall use all reasonable commercial
\nefforts to deliver or cause to be delivered to DuPont all DuPont Books and
\nRecords in the possession of Conoco or any Transferred Business Company. The
\nforegoing shall be limited by the following specific provisions:<\/p>\n
(i) To the extent any document (including computer tape)
\n can be subdivided without unreasonable effort into
\n two portions, one of which constitutes a Conoco
\n Book and Record and the other of which constitutes
\n a DuPont Book and Record, such docu-<\/p>\n
70
\n 77
\n ment (including computer tape) shall be so
\n sub-divided and the appropriate portions shall be
\n delivered to the parties.<\/p>\n
(ii) Neither party shall be required to conduct any
\n general search or investigation of its files.<\/p>\n
(iii) “Reasonable commercial efforts” shall require only
\n deliveries of (a) specific and discrete books and
\n records or a reasonably limited class of items
\n requested by the other party and (b) specific and
\n discrete books and records identified by either party
\n in the ordinary course of business in which it
\n determines to be material to the other’s business.<\/p>\n
(iv) Each party may retain copies of books and records
\n delivered to the other, subject to holding in
\n confidence in accordance with Section 8.5 hereof
\n information contained in such books and records.<\/p>\n
(v) Each party may in good faith refuse to furnish any
\n Information if it believes in good faith that doing
\n so could adversely affect its ability to successfully
\n assert a claim of Privilege.<\/p>\n
(vi) Neither Party shall be required to deliver to the
\n other books and records or portions thereof which are
\n subject to any Law or confidentiality agreements
\n which would by their terms prohibit such delivery;
\n provided, however, if requested by the other party,
\n such party shall use its reasonable commercial
\n efforts to seek a waiver of or other relief from such
\n confidentiality restriction.<\/p>\n
Section 8.2 Access to Information. From and after the
\nEffective Date, DuPont and Conoco, subject to compliance by the other, its
\nSubsidiaries and all of their designated Representatives with the provisions of
\nSection 8.5, shall afford to each other and to each other’s authorized
\naccountants, counsel and other designated Representatives reasonable access and
\nduplicating rights (with copying costs to be borne by the requesting party)
\nduring normal business hours to all books and records and documents,
\ncommunications, items and matters (collectively, “Information”) within the
\nknowledge, possession or control of the other party or any DuPont Party or
\nConoco Party relating to the Transferred Assets, the Excluded Assets, the DuPont
\nTransferred Assets, the Conoco Business, the DuPont Business, the As-<\/p>\n
71
\n 78
\nsumed Liabilities, the Retained Liabilities, the Delayed Companies and the
\nTransferred Employees, insofar as such access is reasonably required by DuPont
\nor Conoco or any of their Subsidiaries or Affiliates, as the case may be, for a
\nparticular purpose and is permitted by Law (and shall use reasonable efforts to
\ncause persons or firms possessing relevant Information to give similar access).
\nWithout limiting the generality of the foregoing, Information may be requested
\nunder this Article VIII for audit, accounting and tax purposes and in connection
\nwith Actions (other than Actions in which both DuPont or any Retained
\nSubsidiary, on the one hand, and Conoco or any of its Subsidiaries, on the other
\nhand, as the case may be, are parties and may be adverse to one another in such
\nAction), as well as for purposes of fulfilling disclosure and reporting
\nobligations. Notwithstanding anything to the contrary in this Agreement, neither
\nDuPont or any of the Retained Subsidiaries, on the one hand, nor Conoco or any
\nof its Subsidiaries, on the other hand, shall be required to disclose any
\ninformation to the other or their authorized Representatives if doing so could
\nviolate any Contract or Law to which DuPont or any of the Retained Subsidiaries,
\non the one hand, or Conoco or any of its Subsidiaries, on the other hand, is a
\nparty or is subject or which any believes in good faith could result in a loss
\nof the ability to successfully assert a claim of Privilege.<\/p>\n
Section 8.3 Production of Witnesses and Individuals. From and
\nafter the Effective Date, DuPont and Conoco shall use reasonable efforts to make
\navailable to each other, upon written request, its officers, directors,
\nemployees and agents for fact finding, consultation and interviews and as
\nwitnesses to the extent that any such person may reasonably be required in
\nconnection with any Actions (other than Actions in which both DuPont or any
\nRetained Subsidiary, on the one hand, and Conoco or any of its Subsidiaries, on
\nthe other hand, as the case may be, are parties and may be adverse to one
\nanother in such Action) in which the requesting party may from time to time be
\ninvolved relating to the conduct of the Conoco Business or the Retained
\nBusiness. DuPont and Conoco agree to reimburse each other for reasonable
\nout-of-pocket expenses (other than officers’ or employees’ salaries) incurred by
\nthe other in connection with providing individuals and witnesses pursuant to
\nthis Section 8.3.<\/p>\n
Section 8.4 Retention of Records. Except when a longer
\nretention period is otherwise required by law or agreed to in writing, including
\nas provided in the Tax Sharing Agreement, DuPont and Conoco shall retain, in
\naccordance with their respective records control schedule policy existing from
\ntime to time, all material Information relating to the Conoco Business, the
\nRestructuring or the transactions contemplated hereby. The parties hereto agree
\nthat upon written request from the other that certain Information relating to
\nthe Conoco Business, the Restruc-<\/p>\n
72
\n 79
\nturing or the transactions contemplated hereby be retained in connection with an
\nAction, the parties shall use reasonable efforts to preserve and not to destroy
\nor dispose of such Information without the consent of the requesting party. If a
\nparty shall request in writing prior to the scheduled date for the destruction
\nor disposal of any Information that any of the Information proposed to be
\ndestroyed or disposed of be delivered to such requesting party, the other party
\nshall promptly arrange for the delivery of the Information so requested, and the
\nrequesting party shall pay the reasonable out-of-pocket costs of the delivering
\nparty in connection therewith; provided, however, nothing in this Section 8.4
\nshall require the delivery of any Information which (i) in the party’s good
\nfaith judgment could result in a waiver of any Privilege or (ii) such party is
\nnot permitted to deliver because of any Law or confidentiality obligation with a
\nthird-party with respect to which such party shall use its reasonable commercial
\nefforts to obtain a waiver of or other relief from such confidentiality
\nrestriction.<\/p>\n
Section 8.5 Confidentiality.<\/p>\n
(a) For a period (i) in the case of Confidential
\nInformation that is Confidential Business Information, of ten years from the
\nEffective Date and (ii) in the case of Confidential Information that is
\nConfidential Operational Information, continuing into perpetuity, DuPont and
\nConoco shall hold and shall respectively cause the Retained Subsidiaries and
\nConoco’s Subsidiaries to hold, and shall each cause their respective officers,
\nemployees, agents, consultants and advisors to hold, in strict confidence and
\nnot to disclose or release without the prior written consent of the other party,
\nany and all Confidential Information (as defined herein); provided, that the
\nparties may disclose, or may permit disclosure of, Confidential Information (i)
\nto their respective auditors, attorneys, financial advisors, bankers and other
\nappropriate consultants and advisors who have a need to know such information
\nand are informed of their obligation to hold such information confidential to
\nthe same extent as is applicable to the parties hereto and in respect of whose
\nfailure to comply with such obligations, Conoco or DuPont, as the case may be,
\nwill be responsible or (ii) if the parties, the Retained Subsidiaries or
\nConoco’s Subsidiaries are compelled to disclose any such Confidential
\nInformation by judicial or administrative process or, in the opinion of
\nindependent legal counsel, by other requirements of law. Notwithstanding the
\nforegoing, in the event that any demand or request for disclosure of
\nConfidential Information is made pursuant to clause (ii) above, DuPont or
\nConoco, as the case may be, shall promptly notify the other of the existence of
\nsuch request or demand and shall provide the other a reasonable opportunity to
\nseek an appropriate protective order or other remedy, which both parties will
\ncooperate in obtaining. In the event that such appropriate protective order or
\nother remedy is not obtained, the<\/p>\n
73
\n 80
\nparty whose Confidential Information is required to be disclosed shall or shall
\ncause the other party to furnish, or cause to be furnished, only that portion of
\nthe Confidential Information that is legally required to be disclosed. As used
\nin this Section 8.5:<\/p>\n
(i) “Confidential Information” shall mean Confidential
\n Business Information and Confidential Operational
\n Information of one party which, prior to or following
\n the Effective Date, has been disclosed by DuPont or
\n the Retained Subsidiaries, on the one hand, or Conoco
\n or its Subsidiaries, on the other hand, in written,
\n oral (including by recording), electronic, or
\n visual form to, or otherwise has come into the
\n possession of, the other, including pursuant to the
\n access provisions of Section 8.2 hereof or any other
\n provision of this Agreement (except to the extent
\n that such Information can be shown to have been (a)
\n in the public domain through no fault of such party
\n (or, in the case of DuPont, any of the Retained
\n Subsidiaries or, in the case of Conoco, any of its
\n Subsidiaries) or (b) later lawfully acquired from
\n other sources by the party (or, in the case of
\n DuPont, such Retained Subsidiary or, in the case of
\n Conoco, such Subsidiary) to which it was furnished;
\n provided, however, in the case of (b) that such
\n sources did not provide such Information in breach of
\n any confidentiality obligations).<\/p>\n
(ii) “Confidential Operational Information” shall mean all
\n proprietary, technical or operational information,
\n data or material including, but not limited to, (a)
\n specifications, ideas and concepts for products,
\n equipment, processes and services; (b) manufacturing
\n and performance specifications and procedures; (c)
\n engineering drawings and graphs; (d) technical,
\n research and engineering data; (e) formulations,
\n mate- rials and material specifications; (f)
\n laboratory studies and bench- mark tests; (g) service
\n and operation manuals; (h) quality assurance
\n policies, procedures and specifications; (i)
\n evaluation and\/or validation studies; (j) pending
\n patent applications; (k) all other know-how,
\n methodology, procedures, techniques and trade secrets
\n related to research, engineering, development and
\n manufacturing; (l) market development plans and
\n forecasts, research and development agreements, and
\n customer and vendor information; (m) computer
\n software and derivatives thereof, (n) train-<\/p>\n
74
\n 81
\n ing materials and information; (o) decision and risk
\n analysis information; and (p) technical environmental
\n information.<\/p>\n
(iii) “Confidential Business Information” shall mean all
\n proprietary information, data or material other
\n than Confidential Operational Information,
\n including, but not limited to (a) proprietary
\n company-level and divisional earnings reports and
\n forecasts, (b) proprietary macro- economic reports
\n and forecasts, (c) proprietary company-level and
\n divisional business plans, (d) proprietary general
\n market evaluations and surveys and (e) proprietary
\n financing and credit-related information.<\/p>\n
Notwithstanding the first sentence of this Section 8.5(a), with respect to any
\nConfidential Business Information that is disclosed after the Effective Date
\n(which shall be deemed to be Confidential Information for the purposes of this
\nSection), the obligations of this subsection shall terminate ten years after the
\ndate of the first disclosure of such Confidential Business Information to DuPont
\nor the Retained Subsidiaries, on the one hand, or Conoco or its Subsidiaries, on
\nthe other hand.<\/p>\n
(b) Notwithstanding anything to the contrary set
\nforth herein, (i) DuPont and the Retained Subsidiaries, on the one hand, and
\nConoco and its Subsidiaries, on the other hand, shall be deemed to have
\nsatisfied their obligations hereunder with respect to Confidential Information
\nif they exercise the same degree of care (but no less than a reasonable degree
\nof care) as they take to preserve confidentiality for their own similar
\nInformation and (ii) confidentiality obligations provided for in any agreement
\nbetween DuPont or any of the Retained Subsidiaries, or Conoco or any of its
\nSubsidiaries, on the one hand, and any employee of DuPont or any of the Retained
\nSubsidiaries, or Conoco or any of its Subsidiaries, on the other hand shall
\nremain in full force and effect. Confidential Information of DuPont and the
\nRetained Subsidiaries, on the one hand, or Conoco and its Subsidiaries, on the
\nother hand, in the possession of and used by the other as of the Effective Date
\nmay continue to be used by such Person in possession of the Confidential
\nInformation in and only in the operation of the Retained Business or Transferred
\nBusiness, as the case may be, and may be used only so long as the Confidential
\nInformation is maintained in confidence and not disclosed in violation of
\nSection 8.5(a). Such continued right to use may not be transferred to any third
\nparty unless the third party purchases all or substantially all of the business
\nand Assets in one transaction or in a series of related transactions for which
\nor in which the relevant Confidential Information is used or employed. In the
\nevent that such right to use is transferred in accor-<\/p>\n
75
\n 82
\ndance with the preceding sentence, the transferring party shall not disclose the
\nsource of the relevant Confidential Information.<\/p>\n
Section 8.6 Privileged Matters.<\/p>\n
(a) DuPont and Conoco agree that their respective
\nrights and obligations to maintain, preserve, assert or waive any or all
\nprivileges belonging to either corporation with respect to the Conoco Business
\nor the DuPont Business, including but not limited to the attorney-client and
\nwork product privileges (collectively, “Privileges”), shall be governed by the
\nprovisions of this Section 8.6. With respect to matters relating to the DuPont
\nBusiness, DuPont shall have sole authority in perpetuity to determine whether to
\nassert or waive any or all Privileges, and Conoco shall take no action (nor
\npermit any of its Subsidiaries to take action) without the prior written consent
\nof DuPont that could result in any waiver of any Privilege that could be
\nasserted by DuPont or any Retained Subsidiary under applicable law and this
\nAgreement. With respect to matters relating to the Conoco Business, Conoco shall
\nhave sole authority in perpetuity to determine whether to assert or waive any or
\nall Privileges, and DuPont shall take no action (nor permit any of the Retained
\nSubsidiaries to take action) without the prior written consent of Conoco that
\ncould result in any waiver of any Privilege that could be asserted by Conoco or
\nany of its Subsidiaries under applicable law and this Agreement. The rights and
\nobligations created by this Section 8.6 shall apply to all Information as to
\nwhich DuPont or Conoco or their respective Subsidiaries would be entitled to
\nassert or has asserted a Privilege without regard to the effect, if any, of the
\nSeparation (“Privileged Information”). Privileged Information of DuPont includes
\nbut is not limited to (i) any and all Information existing prior to the
\nSeparation regarding the DuPont Business but which after the Restructuring is in
\nthe possession of Conoco or any of its Subsidiaries; (ii) all communications
\nsubject to a Privilege occurring prior to the Separation between counsel for
\nDuPont or any of the Retained Subsidiaries (including in-house<\/p>\n
76
\n 83
\ncounsel and former in-house counsel who are Transferred Employees) and any
\nperson who, at the time of the communication, was an employee of DuPont or any
\nof the Retained Subsidiaries, regardless of whether such employee is or becomes
\nan employee of Conoco or any of its Subsidiaries; and (iii) all Information
\ngenerated, received or arising after the Effective Date that refers or relates
\nto Privileged Information generated, received or arising prior to the Effective
\nDate. Privileged Information of Conoco includes but is not limited to (i) any
\nand all Information generated prior to the Separation regarding the Conoco
\nBusiness but which after the Restructuring is in the possession of DuPont or any
\nof the Retained Subsidiaries; (ii) all communications subject to a Privilege
\noccurring prior to the Separation between counsel for Conoco or any of its
\nSubsidiaries (including in-house counsel and former in-house counsel who are
\nemployees of DuPont or the Retained Subsidiaries) and any person who, at the
\ntime of the communication, was an employee of Conoco or any of its Subsidiaries,
\nregardless of whether such employee is or becomes an employee of DuPont or any
\nof the Retained Subsidiaries; and (iii) all Information generated, received or
\narising after the Effective Date that refers or relates to Privileged
\nInformation generated, received or arising prior to the Effective Date.<\/p>\n
(b) Upon receipt by DuPont or Conoco, as the case may
\nbe, of any subpoena, discovery or other request from any third party that
\nactually or arguably calls for the production or disclosure of Privileged
\nInformation of the other or if DuPont or Conoco, as the case may be, obtains
\nknowledge that any current or former employee of DuPont or Conoco, as the case
\nmay be, has received any subpoena, discovery or other request from any third
\nparty that actually or arguably calls for the production or disclosure of
\nPrivileged Information of the other, DuPont or Conoco, as the case may be, shall
\npromptly notify the other of the existence of the request and shall provide the
\nother a reasonable opportunity to review the Information and to assert any
\nrights it may have under this Section 8.6 or otherwise to prevent the production
\nor disclosure of Privileged Information. DuPont or Conoco, as the case may be,
\nwill not produce or disclose to any third party any of the other’s Information
\ncovered by a Privilege under this Section 8.6 unless (a) the other has provided
\nits express written consent to such production or disclosure, or (b) a court of
\ncompetent jurisdiction has entered an order not subject to interlocutory appeal
\nor review finding that the Information is not entitled to protection from
\ndisclosure under any applicable privilege, doctrine or rule.<\/p>\n
(c) DuPont’s transfer of Conoco Books and Records and
\nother Information to Conoco, DuPont’s agreement to permit Conoco to obtain
\nInformation existing prior to the Separation, Conoco’s transfer of DuPont Books
\nand Records and other Information and Conoco’s agreement to permit DuPont to
\nobtain Information existing prior to the Separation are made in reliance on
\nDuPont’s and Conoco’s respective agreements, as set forth in Section 8.5 and
\nthis Section 8.6, to maintain the confidentiality of such Information and to
\ntake the steps provided herein for the preservation of all Privileges that may
\nbelong to or be asserted by DuPont or Conoco, as the case may be. The access to
\nInformation being granted pursuant to Section 8.2 hereof, the agreement to
\nprovide witnesses and individuals pursuant to Section 8.3 hereof and the
\ndisclosure to Conoco and DuPont of Privileged Information relating to the Conoco
\nBusiness or DuPont Business pursuant to this Agreement in connection with the
\nSeparation shall not be asserted by DuPont or Conoco to constitute, or otherwise
\ndeemed, a waiver of any Privilege that has been or may be<\/p>\n
77
\n 84
\nasserted under this Section 8.6 or otherwise. Nothing in this Agreement shall
\noperate to reduce, minimize or condition the rights granted to DuPont and Conoco
\nin, or the obligations imposed upon DuPont and Conoco by, this Section 8.6.<\/p>\n
Section 8.7 Mail and Other Communications. After the Effective
\nDate, each of DuPont and Conoco may receive mail, telegrams, packages and other
\ncommunications properly belonging to the other. Accordingly, at all times after
\nthe Effective Date, each of DuPont and Conoco authorizes the other to receive
\nand open all mail, telegrams, packages and other communications received by it
\nand not unambiguously intended for the other party or any of the other party’s
\nofficers or directors, and to retain the same to the extent that they relate to
\nthe business of the receiving party or, to the extent that they do not relate to
\nthe business of the receiving party, the receiving party shall promptly deliver
\nsuch mail, telegrams, packages or other communications (or, in case the same
\nrelate to both businesses, copies thereof) to the other party as provided for in
\nSection 14.5 hereof. The provisions of this Section 8.7 are not intended to, and
\nshall not, be deemed to constitute an authorization by either DuPont or Conoco
\nto permit the other to accept service of process on its behalf and neither party
\nis or shall be deemed to be the agent of the other for service of process
\npurposes.<\/p>\n
ARTICLE IX<\/p>\n
INTERCOMPANY BUSINESS RELATIONSHIPS<\/p>\n
Section 9.1 Cash Management; Settlement of Intercompany
\nAccounts.<\/p>\n
(a) Conoco shall make or cause its Subsidiaries
\n(other than Petrozuata) to make, cash distributions or other payments to
\nDuPont or any Retained Subsidiary, at such time, in such form and in amounts to
\nbe determined by DuPont in its sole discretion after consultation with Conoco,
\nincluding repayments or purchases of the Restructured Notes and the Conoco
\nMaster Note, such that as of the close of business on October 30, 1998 (the
\n“Cash Settlement Date”), after giving effect to such payments and the following
\ntransactions: (i) the receipt by Conoco of the net proceeds of the IPO,
\nincluding upon exercise of the underwriters’ over-allotment option and any
\npayments made in respect of the DuPont Master Note and (ii) the required
\nrepayments on or repurchases of the Note, the Restructured Notes and the Conoco
\nMaster Note, as set forth in Section 2.5(b), Conoco and its Subsidiaries
\n(excluding Petrozuata) will have an aggregate amount of cash and cash
\nequivalents<\/p>\n
78
\n 85
\nequal to the Target Cash Amount (with the distribution of such cash and cash
\nequivalents among Conoco and its Subsidiaries to be as mutually agreed by DuPont
\nand Conoco); provided that no portion of the IPO Excess or any other cash shall
\nbe paid to DuPont or a Retained Subsidiary (other than in whole or in part in
\npayment or purchase of one or more of the Restructured Notes or the Conoco
\nMaster Note or, as otherwise provided in this Section 9.1(a) or Section 2.5(b),
\nin whole or in partial payment of the Note), but may be used as all or a portion
\nof the Target Cash Amount. Notwithstanding the foregoing, any cash and cash
\nequivalents of Conoco and any of its Subsidiaries (other than Petrozuata) on or
\nprior to the Cash Settlement Date, and any IPO proceeds received after the Cash
\nSettlement Date upon the exercise of the underwriters’ over-allotment option,
\nshall be used to make payments, first, in respect of any remaining portion of
\nthe Restructured Notes and any accrued interest thereon and second, in respect
\nof any remaining portion of the Conoco Master Note and accrued interest thereon
\n(and, after such Restructured Notes and the Conoco Master Note have been paid in
\nfull, to make payments in respect of the Note including accrued interest thereon
\nif and to the extent DuPont so requests) so long as, as of the Cash Settlement
\nDate and after giving effect to the foregoing payments as if they had occurred
\non the Cash Settlement Date, Conoco and its Subsidiaries (excluding Petrozuata)
\nwill have an aggregate amount of cash and cash equivalents equal to the Target
\nCash Amount. Notwithstanding the foregoing, Conoco and DuPont agree that as of
\nthe close of business on the Cash Settlement Date, Danube and its Subsidiaries
\nshall have at least $70 million in cash or cash equivalents, (including amounts
\nheld in the form of certificates of deposit, valued at their face amounts)
\nwhether or not such amounts are characterized or classified as such by GAAP,
\nplus such additional amounts as are required to be paid to Christiana as
\nprovided in Section 10.3 to cover unearned premiums and loss reserves to the
\nextent such amounts have not already been paid. In the event that after giving
\neffect to the payments and purchases described in Section 2.5(b) and in this
\nSection 9.1(a) Conoco and its Subsidiaries (excluding Petrozuata) do not have an
\naggregate amount of cash and cash equivalents equal to the Target Cash Amount on
\nthe Cash Settlement Date, DuPont will promptly pay to Conoco the amount of cash
\nrequired to increase the cash and cash equivalents of Conoco and its
\nSubsidiaries (excluding Petrozuata) to the Target Cash Amount, unless and to the
\nextent that DuPont determines in good faith that such deficiency occurred by
\nreason of Conoco or its Subsidiaries not operating its business in the ordinary
\ncourse consistent with past practice.<\/p>\n
(b) If, as of the close of business on the Cash Settlement
\nDate, (i) DuPont or any of the Retained Subsidiaries has any liability or
\nobligation to make cash payments to third parties for the benefit of Conoco or
\nany of the Transferred Business Companies which have not yet been paid (whether
\nor not invoices have<\/p>\n
79
\n 86
\nbeen received or liabilities accrued) (“DuPont Payables”), or (ii) Conoco or any
\nof the Transferred Business Companies has any liability or obligation to make
\ncash payments to third parties for the benefit of DuPont or any of the Retained
\nSubsidiaries which have not been paid (whether or not invoices have been
\nreceived or liabilities accrued) (“Conoco Payables”), then on the 30th business
\nday following the Cash Settlement Date if (x) the DuPont Payables exceed the
\nConoco Payables, then Conoco shall promptly pay to DuPont in immediately
\navailable funds an amount equal to the difference between the DuPont Payables
\nand the Conoco Payables and (y) the Conoco Payables exceed the DuPont Payables,
\nthen DuPont shall promptly pay to Conoco in immediately available funds an
\namount equal to the difference between the Conoco Payables and the DuPont
\nPayables; provided, however, that to the extent DuPont and Conoco agree, the
\naccounting of, and the adjustment with respect to, the DuPont Payables and the
\nConoco Payables may be done on a separate Subsidiary-by-Subsidiary basis.<\/p>\n
(c) If, as of the close of business on the Cash
\nSettlement Date, there are checks or other drafts or withdrawals written on
\ndisbursement bank accounts of Conoco or the Transferred Business Companies which
\nare utilized by the Transferred Business prior to the Cash Settlement Date which
\nhave not been cashed and deducted from such accounts as of the close of business
\non the Cash Settlement Date (the sum of all such checks, drafts or withdrawals,
\nthe “Outstanding Check Amount”), DuPont shall promptly pay to Conoco in
\nimmediately available funds an amount equal to the Outstanding Check Amount;
\nprovided, however, that to the extent DuPont and Conoco agree, the adjustment
\nwith respect to the Outstanding Check Amount may be done on a separate
\nSubsidiary-by-Subsidiary basis.<\/p>\n
(d) Except as otherwise expressly provided in this
\nAgreement, all intercompany and interdivisional receivables, payables, cash
\noverdrafts and other accounts in existence between Conoco and the Transferred
\nBusiness Companies, on the one hand, and DuPont and the Retained Subsidiaries,
\non the other hand (the “Intercompany Accounts”), under DuPont’s cash management
\nprogram or otherwise (other than the Note, the Restructured Notes, the Employee
\nBenefit Note, amounts owed under the DuPont Hungary Loan, amounts owed pursuant
\nto the second sentence of Section 2.5(c), amounts owed to DuPont or a Retained
\nSubsidiary under the DuPont Master Note Agreement, if any, borrowings under the
\nRevolving Credit Facility and payments pursuant to Sections 7.1 and 7.2 hereof),
\nshall be cancelled immediately prior to the close of business on the Cash
\nSettlement Date or otherwise settled by mutual agreement of the parties. Except
\nas expressly provided in this Agreement, including Section 9.5 and Section 7.2,
\nfollowing the Effective Date, no such intercompany transactions (other than
\nthose arising from commercial dealings<\/p>\n
80
\n 87
\nin the ordinary course of business) shall be entered into except pursuant to the
\nexpress terms and conditions of the Transitional Services Agreements or the
\nother Related Agreements.<\/p>\n
(e) Thirty days following the Cash Settlement Date,
\nDuPont and Conoco shall reconcile all transfers, payments and calculations made
\npursuant to this Section 9.1 as of the Cash Settlement Date, and to the extent
\nany such transfer, payment or calculation was made in error, including by reason
\nof subsequently dishonored third party checks or otherwise, an appropriate
\npayment shall be made by DuPont or Conoco, as the case may be, to the other
\nparty.<\/p>\n
(f) Following the Effective Date, each of DuPont and
\nConoco shall give the other party and any independent auditors of such other
\nparty full access at all reasonable times to the DuPont Books and Records and
\nthe Conoco Books and Records, as the case may be, relating to periods prior to
\nthe Cash Settlement Date for purposes of verifying the amounts to be paid
\npursuant to Section 9.1(b) and 9.1(c) above and for resolving any disputes
\nrelated thereto. The amounts settled shall, to the extent applicable, be
\ncalculated in accordance with GAAP.<\/p>\n
(g) Promptly following the Effective Time, DuPont
\nshall make the Revolving Credit Facility available to Conoco, subject to the
\nterms and conditions thereof. No repayments may be made by Conoco or any of its
\nSubsidiaries in respect of borrowings outstanding under the Revolving Credit
\nFacility prior to the Outside Date. Neither Conoco nor any of its Subsidiaries
\nnor DuPont nor any of its Subsidiaries may borrow any amounts under the DuPont
\nMaster Note Agreement after the Cash Settlement Date; provided that between the
\nEffective Time and the Cash Settlement Date Conoco and its Subsidiaries may
\nborrow amounts under the Conoco Master Note only if after giving effect to such
\nborrowings the aggregate principal amount outstanding under the Conoco Master
\nNote would not exceed $240 million.<\/p>\n
(h) Notwithstanding anything to the contrary
\ncontained herein any payments required to be made on the Cash Settlement Date
\nshall be made on November 13, 1998 or such other date as DuPont and Conoco
\nmutually agree upon; provided that the computations of such payments shall be
\nmade as of the Cash Settlement Date.<\/p>\n
Section 9.2 Letters of Credit. (a) After the Effective Date,
\nif letters of credit for the account of DuPont or any Retained Subsidiary issued
\non behalf of or for the benefit of a Transferred Business Company remain
\noutstanding, Conoco<\/p>\n
81
\n 88
\nshall, and shall cause its Subsidiaries to, use their respective best efforts to
\nreplace such letters of credit as promptly as practicable with letters of credit
\nissued for the account of Conoco or any of its Subsidiaries (it being understood
\nthat neither obtaining such replacement letters of credit by Conoco or one of
\nits Subsidiaries nor any drawings pursuant thereto shall be deemed to result in
\nthe incurrence of Indebtedness for purposes of Section 6(c) of the Note).
\nFollowing the Effective Date, (i) Conoco shall indemnify and hold harmless the
\nDuPont Parties for any Losses arising from or relating to such unreplaced
\nletters of credit, including but not limited to, any fees in connection with the
\nissuance and maintenance thereof and (ii) Conoco shall not, and shall not permit
\nany of its Subsidiaries to, enter into, renew or extend the term of, increase
\nits obligations under, or transfer to a third party, any loan, lease, Contract
\nor other obligation in connection with which DuPont or any Retained Subsidiary
\nhas issued any letters of credit which remain outstanding. The parties hereto
\nagree that neither DuPont nor any of the Retained Subsidiaries will have any
\nobligation to renew any letters of credit issued on behalf of the Transferred
\nBusiness after the expiration of any such letter of credit. Commencing on the
\nearlier to occur of (i) two years following the Effective Date and (ii) the
\nfirst date on which the voting power of shares of Voting Stock beneficially
\nowned by DuPont falls below 50% of the total voting power of all of the
\noutstanding shares of Voting Stock, Conoco shall pay to DuPont a fee payable at
\nthe end of each calendar quarter calculated by applying a rate of .20% per annum
\nto the average outstanding balance during such quarter of any outstanding
\nletters of credit issued for the account of DuPont or any Retained Subsidiary on
\nbehalf of or for the benefit of any Transferred Business Company.<\/p>\n
Section 9.3 Guarantee Obligations.<\/p>\n
(a) DuPont and Conoco shall cooperate and Conoco
\nshall use its best efforts to terminate, or to cause Conoco, one of its
\nSubsidiaries, or one of its Affiliates (other than DuPont and any of the
\nRetained Subsidiaries) to be substituted in all respects for DuPont and any of
\nRetained Subsidiaries in respect of, all obligations of DuPont or any of the
\nRetained Subsidiaries under any loan, financing, lease, Contract or other
\nobligation (other than letters of credit governed by Section 9.2) in existence
\nas of the Effective Date pertaining to the Transferred Business for which DuPont
\nor any of the Retained Subsidiaries is or may be liable, as guarantor, original
\ntenant, primary obligor or otherwise including, but not limited to (so long as
\nthey are of the same type or nature), as those set forth on Schedule 9.3, but
\nexcluding Shared Contracts (“DuPont Guarantees”). If such a termination or
\nsubstitution is not effected by the Effective Date, (i) Conoco shall indemnify
\nand hold harmless the DuPont Parties for any Losses arising from or relating to
\nDuPont Guarantees, and (ii)<\/p>\n
82
\n 89
\nfrom and after the Effective Date, Conoco shall not, and shall not permit any of
\nits Subsidiaries to, enter into, renew or extend the term of, increase its
\nobligations under, or transfer to a third party, any loan, lease, Contract or
\nother obligation for which DuPont is or may be liable pursuant to a DuPont
\nGuarantee. DuPont agrees that it shall notify Conoco in a timely manner of any
\nchanges to the DuPont Guarantee Amount. To the extent that DuPont or the
\nRetained Subsidiaries have performance obligations under any DuPont Guarantee,
\nConoco will use best efforts to (i) perform such obligations on behalf of DuPont
\nand the Retained Subsidiaries or (ii) otherwise take such action as requested by
\nDuPont so as to put DuPont and the Retained Subsidiaries in the same position as
\nif Conoco, and not DuPont and the Retained Subsidiaries, had performed or were
\nperforming such obligations, including, without limitation, concurrently
\npurchasing from DuPont and the Retained Subsidiaries such products that DuPont
\nand the Retained Subsidiaries are required to purchase pursuant to the relevant
\nDuPont Guarantee in lieu of performance by Conoco or any of its Subsidiaries. If
\nConoco concurrently purchases products from DuPont and the Retained
\nSubsidiaries, the price to be paid by Conoco or any of its Subsidiaries shall be
\nan amount sufficient to fully indemnify DuPont and the Retained Subsidiaries for
\nall costs and expenses related to the purchase by DuPont and the Retained
\nSubsidiaries of such products.<\/p>\n
(b) Commencing on the earlier to occur of (i) two
\nyears following the Effective Date or (ii) the first date on which the voting
\npower of shares of common stock of Conoco beneficially owned by DuPont falls
\nbelow 50% of the total voting power of all of the outstanding shares of Voting
\nStock, Conoco shall pay to DuPont a fee payable at the end of each calendar
\nquarter calculated by applying a rate of .20% per annum to the average
\noutstanding DuPont Guarantee Amount during such quarter (the “DuPont Guarantee
\nFee”).<\/p>\n
(c) Conoco agrees that it will not, without the
\nexpress written consent of DuPont, which consent may be withheld in the sole
\ndiscretion of DuPont, enter into any agreement with respect to a merger,
\nconsolidation or amalgamation with, or sale of all or substantially all the
\nassets, in one transaction or in a series of related transactions to, any third
\nparty, unless such third party expressly agrees as a term of such agreement to
\n(i) terminate, or to cause such third party or one of its Affiliates to be
\nsubstituted in all respects for DuPont in respect of, all obligations of DuPont
\nor any of the Retained Subsidiaries under the DuPont Guarantees, (ii) indemnify
\nand hold harmless the DuPont Parties for any Losses arising from or relating to
\nDuPont Guarantees, (iii) assume or guarantee the payment to DuPont of any unpaid
\nDuPont Guarantee Fee by Conoco or any successor to Conoco in accordance with
\nSection 9.3(b) above and (iv) not, and to not permit Conoco or any<\/p>\n
83
\n 90
\nof its Subsidiaries or Affiliates to, renew or extend the term of, increase its
\nobligations under, or transfer to another third party, any loan, lease, Contract
\nor other obligation for which DuPont is or may be liable pursuant to a DuPont
\nGuarantee prior to such termination or substitution.<\/p>\n
Section 9.4 Settlements for Cash Collections and Disbursements
\nAfter the Cash Settlement Date.<\/p>\n
(a) For each calendar month commencing with the month
\nin which the Cash Settlement Date occurs and, unless sooner terminated by
\nagreement of the parties, continuing for a period of two years thereafter, (i)
\nwithin 30 business days of the end of the month in question, DuPont shall
\nprepare, and Conoco shall fully cooperate in preparing, a statement of
\ntransactions which shall reflect a complete analysis of any cash collections and
\ncash disbursements by DuPont and the Retained Subsidiaries on behalf of Conoco
\nand its Subsidiaries (including those relating to the Transferred Business)
\nduring the relevant month and (ii) within 30 business days of the end of the
\nmonth in question, Conoco shall prepare, and DuPont shall fully cooperate in
\npreparing, a statement of transactions which shall reflect a complete analysis
\nof any cash collections and cash disbursements by Conoco and its Subsidiaries on
\nbehalf of DuPont and the Retained Subsidiaries during the relevant month
\n(including those relating to the Retained Business and the Delayed Companies);
\nprovided in each case that, with respect to the first such monthly period such
\nstatement shall not reflect any cash collections or disbursements occurring
\nprior to the Effective Date.<\/p>\n
(b) Not later than 30 business days following
\ndelivery of each such monthly statement, Conoco shall, or shall cause one of it
\nSubsidiaries to pay to DuPont or one of the Retained Subsidiaries or DuPont
\nshall, or shall cause one of the Retained Subsidiaries pay to Conoco or one of
\nits Subsidiaries, as the case may be, in cash an amount necessary to eliminate
\nthe account balance as reflected in each such statement unless DuPont and Conoco
\notherwise agree in writing. Payments made pursuant to this Section 9.4 shall
\nnot, for any purpose of this Agreement, constitute Losses or be set off against
\nany other payments to be made, Liabilities asserted or claims made pursuant to
\nthis Agreement, including but not limited to Article VI hereof.<\/p>\n
(c) Following the end of the two-year period referred
\nto in Section 9.4(a) above (or such earlier period as the parties hereto may
\nagree), (i) DuPont shall promptly turn over to Conoco all cash and other similar
\namounts received by DuPont and the Retained Subsidiaries which properly
\nconstitute Assets<\/p>\n
84
\n 91
\nattributable to the Transferred Business and (ii) Conoco shall promptly turn
\nover to DuPont all cash and other similar amounts received by Conoco and its
\nSubsidiaries which properly constitute Assets attributable to the Retained
\nBusiness.<\/p>\n
Section 9.5 Termination of Intercompany Agreements. Each of
\nthe parties hereto agrees that, except as otherwise expressly provided in this
\nAgreement, the several Transitional Services Agreements, the Related Agreements
\nor the agreements set forth on Schedule 9.5, all Intercompany Agreements and all
\nother intercompany arrangements and course of dealings whether or not in writing
\nand whether or not binding in effect immediately prior to the Effective Date
\nshall continue in full force and effect; provided that either Conoco or any of
\nits Subsidiaries, on the one hand, or DuPont or any of the Retained
\nSubsidiaries, on the other hand, may terminate any Intercompany Agreements or
\nany such arrangements or course of dealings (other than any Related Agreement,
\nthe Restructured Notes, the agreements set forth on Schedule 9.5 and the DuPont
\nHungary Loan) on 60 days written notice to the other unless a different period
\nof notice of termination is specified therein (in which case, such different
\nperiod shall control), but in any event may be terminated one year after the
\nEffective Date.<\/p>\n
Section 9.6 DuPont Hungary Loan. Conoco shall use its best
\nefforts to obtain the required approvals of all Governmental Authorities to
\nrepay the DuPont Hungary Loan as promptly as practicable following the Effective
\nDate and Conoco shall cause the DuPont Hungary Loan to be repaid in full,
\nincluding accrued interest thereon, promptly following the receipt of all such
\napprovals. Promptly following receipt by DuPont or any Retained Subsidiary of
\nfunds in repayment of the DuPont Hungary Loan, DuPont shall or shall cause a
\nRetained Subsidiary to remit all of such funds to Conoco, or any subsidiary of
\nConoco, as Conoco may designate.<\/p>\n
ARTICLE X<\/p>\n
INSURANCE<\/p>\n
Section 10.1 General. Except as otherwise specifically
\nprovided for herein, Conoco and DuPont understand and agree that as of the
\nEffective Date all existing insurance policies providing coverage for the Assets
\nand Liabilities of Conoco and DuPont on a combined basis will have been modified
\nsuch that the Transferred Assets, the Conoco Business and the Assumed
\nLiabilities will be insured separately by Conoco.<\/p>\n
85
\n 92
\n Section 10.2 Excess Liability Policies. In the event of a
\nCombined Limit Loss (as defined below), Conoco and DuPont agree that their
\nrespective risk managers (each, a “Risk Manager”) shall use best efforts to
\nagree on the allocation of insurance proceeds and, in the event of an agreement,
\nto issue joint instructions to Danube and Christiana and to cause Danube and
\nChristiana to likewise issue joint instructions to their respective reinsurers,
\nas appropriate. If the Risk Managers fail to agree on an allocation of insurance
\nproceeds, the allocation shall be resolved by the dispute resolution process set
\nforth in Article XIII hereof. As used in this Section 10.2, “Combined Limit
\nLosses” shall mean any Losses covered by certain excess liability policies under
\nboth the Conoco and DuPont insurance programs (and the reinsurance policies
\nobtained by Danube and to be obtained by Christiana with third party reinsurers
\nfor the same coverages) which contain “combined limit” endorsements which
\nrequire joint instructions from the “named entity” (as such term is defined in
\nsuch policies) be issued to determine the allocation of insurance proceeds.<\/p>\n
Section 10.3 Transfer of Existing Policies.<\/p>\n
(a) It is the intention of the parties that as of the
\nEffective Date insurance matters relating to the Retained Business and Retained
\nLiabilities shall be the responsibility of DuPont and Christiana, and insurance
\nmatters relating to the Conoco Business shall be the responsibility of Conoco
\nand Danube. Prior to the Effective Date, DuPont and Conoco shall use their
\nrespective reasonable commercial efforts to cause (i) Danube to reinsure with,
\nand cede to Christiana, and for Christiana to issue the reinsurance with respect
\nto the insurance policies (other than the excess liability policies issued by
\nDanube to DuPont which are provided for in clause (iii) below) and the
\nassociated dollar amounts of unearned premiums (by reason of relating to the
\nremaining balance of the insured period) previously received by Danube to the
\nextent they relate to the Retained Business and Retained Liabilities; (ii)
\nDanube to (x) reinsure with Christiana, and for Christiana to assume all unpaid
\nclaims, whether known or unknown, arising in connection with the Retained
\nBusiness and\/or Retained Liabilities which had heretofore been insured against
\nby Danube, and (y) cede to Christiana a dollar amount in cash representing the
\nloss reserves carried by Danube with respect to such reinsured claims referred
\nto in clause (x) valued as of the Effective Date or such other date as the Risk
\nManagers of DuPont and Conoco may mutually establish, plus an amount in cash
\nequal to the market price of reinsurance for adverse developments on all unpaid
\nclaims assumed by Christiana, whether known or unknown, as established by
\nDuPont’s and Conoco’s mutual broker, J&H Marsh & McLennan and agreed to by the
\nrespective Risk Managers of DuPont and Conoco; and (iii) Danube to cancel the
\nexcess liability policies theretofore issued by Danube to DuPont to the extent
\nthey relate to the<\/p>\n
86
\n 93
\nRetained Business, and to refund to DuPont the premiums on the current years
\npolicy, which by reason of relating to the remaining term thereof have not been
\nearned.<\/p>\n
(b) Prior to the Effective Date, DuPont and Conoco
\nshall cause Danube to instruct the insurers of the current excess liability
\nreinsurance program applicable to the DuPont Business to amend the policies
\nissued to Danube such that Christiana and not Danube shall be the “named entity”
\nunder such policies. DuPont shall cause Christiana to pay the unearned premium
\non such reinsurance policies to the extent they relate to the Retained Business
\nfor the remaining term of each policy year to J&H Marsh & McLennan, the broker
\nadministering such policies who shall thereafter issue a premium refund to
\nDanube in like amount. DuPont and Conoco, respectively, shall cause Danube and
\nChristiana, respectively, to issue a joint letter of instructions to each
\nreinsurer, allocating between their respective policy programs the existing
\nclaims for which notice has been given to such reinsurer.<\/p>\n
Section 10.4 Director’s and Officer’s Insurance.<\/p>\n
(a) On or before the Effective Date, the directors
\nand officers of Conoco and its Subsidiaries shall become insureds under a
\nseparate director’s and officer’s insurance program to be established by Conoco
\nat its expense.<\/p>\n
(b) In the event of a Tie-In Limit Loss (as defined
\nbelow), Conoco and DuPont agree that their respective Risk Managers shall use
\nbest efforts to agree on the allocation of insurance proceeds and, in the event
\nof an agreement, to issue joint instructions to their respective insurers, as
\nappropriate. If the Risk Managers fail to agree on an allocation of insurance
\nproceeds, the allocation shall be resolved by the dispute resolution process set
\nforth in Article XIII hereof. As used in this Section 10.4, “Tie-In Limit
\nLosses” shall mean any Losses covered by certain directors and officers policies
\nunder both the Conoco and DuPont insurance programs which contain “tie-in limit”
\nendorsements which require joint instructions to be issued to determine the
\nallocation of insurance proceeds.<\/p>\n
Section 10.5 Conoco Liability Policies. Conoco agrees that
\nimmediately prior to the Effective Date and for as long as there is either a
\nDuPont Guarantee obligation outstanding or DuPont treats for financial
\naccounting purposes its equity holding in Conoco on a consolidated basis, Conoco
\n(i) will take all actions necessary consistent with Conoco’s current insurance
\npractices, to continue to purchase and maintain insurance coverage of
\nsubstantially the same types and<\/p>\n
87
\n 94
\namounts as it has heretofore purchased and maintained and (ii) provide that
\nDuPont be a “named insured” under those liability policies of Conoco which are
\nsolely controlled by Conoco, including, but not limited to, those set forth on
\nSchedule 10.5 hereto, at no premium cost to DuPont therefor, such that DuPont
\nhas rights to coverage that are no less than the rights conferred on any other
\ninsured under such policies with respect to liabilities that DuPont may incur
\nrelating to, resulting from or arising out of the Conoco Business; provided
\nthat, in the case of (ii), when DuPont no longer treats its equity holding in
\nConoco on a consolidated basis for financial accounting purposes, such “named
\ninsured” status will only be in respect to liabilities that DuPont may incur as
\na result of a DuPont Guarantee obligation with respect to the Transferred
\nBusiness. During the applicable period set forth in the first sentence of this
\nSection 10.5, all of Conoco’s liability policies to which clause (ii) of the
\npreceding sentence applies shall provide that DuPont will be given at least 60
\ndays advance written notice by the insurer of any cancellation of such policies,
\nany reduction in coverage thereunder, or any deletion of DuPont as a “named
\ninsured,” and Conoco shall not cancel any such policy or reduce the coverage
\navailable thereunder in any manner detrimental to DuPont, without DuPont’s prior
\nwritten consent. DuPont agrees to promptly release Conoco from its obligations
\nunder this Section 10.5 following the date on which (i) there are no DuPont
\nGuarantee obligations outstanding and (ii) DuPont no longer treats its equity
\nholding in Conoco for financial accounting purposes on a consolidated basis.<\/p>\n
Section 10.6 Insurance and Indemnities.<\/p>\n
(a) An Indemnitee shall not be obligated to pursue
\ninsurance coverages under its excess liability insurance program for any Loss.
\nWith respect to such excess liability insurance programs, an Indemnitee, in its
\nsole discretion, may elect to pursue its rights to indemnity hereunder to the
\nexclusion of, or in addition to, pursuing an insurance recovery for such Losses.<\/p>\n
(b) Notwithstanding anything to the contrary set
\nforth herein, (i) with respect to the insurance policies where Conoco and DuPont
\nare each named insureds under the same policy, the parties shall together use
\nreasonable commercial efforts to maximize insurance recoveries prior to either
\nparty seeking indemnification as provided under this Agreement with respect to
\nthat portion of a Loss covered by insurance pursuant to any such policy, and
\n(ii) any insurance recovery by an Indemnitee made under any insurance program
\n(whether excess liability or otherwise) shall be credited against an
\nIndemnifying Party’s obligation pursuant to Section 6.2(d), if applicable, only
\nafter being reduced by any retroactive premium adjustment<\/p>\n
88
\n 95
\nor co-insurance obligation of the Indemnitee, or the cost to the Indemnitee of
\nreinstating aggregate limits under its liability insurance program.<\/p>\n
(c) Notwithstanding the provisions of Section 6.3(g)
\nto the contrary, an Indemnifying Party shall not have subrogation rights to
\npursue an Indemnitee’s insurance coverage for a Loss.<\/p>\n
ARTICLE XI<\/p>\n
ENVIRONMENTAL MATTERS<\/p>\n
Section 11.1 Certain Article XI Definitions. For purposes of
\nthis Article XI, (a) “Transferred Environmental Assets” shall mean (i) the
\nTransferred Assets, (ii) all other Assets, whether or not currently owned by
\nConoco, DuPont, any of their respective Subsidiaries or Affiliates or any
\npredecessors thereof, formerly owned by the Conoco Group or used in the
\noperation or conduct of the Conoco Business, (iii) all Assets of Conoco and its
\nSubsidiaries acquired from and after the Effective Date or used in the operation
\nor conduct of the Transferred Business from and after the Effective Date, and
\n(iv) all Assets and businesses listed on Schedule 11.1(a); and (b) “Retained
\nEnvironmental Assets” shall mean (i) the Assets of DuPont and the Retained
\nSubsidiaries, other than the Transferred Assets, following the consummation of
\nthe Restructuring and the transactions contemplated by Section 2.2 hereof, (ii)
\nall other Assets, not currently owned by DuPont, any of its Subsidiaries or
\nAffiliates or any predecessors thereof, formerly owned by DuPont or used in the
\noperation or conduct of the DuPont Business, (iii) all Assets of DuPont and the
\nRetained Subsidiaries acquired from and after the Effective Date or used in the
\noperation or conduct of the Retained Business from and after the Effective Date,
\nand (iv) the Assets and businesses listed on Schedule 11.1(b), but in the case
\nof (b)(i), (b)(ii) and (b)(iii) above, excluding all Transferred Environmental
\nAssets.<\/p>\n
Section 11.2 Conoco Environmental Liabilities. On the terms
\nand subject to the conditions set forth in this Agreement, Conoco agrees to
\nassume, pay, perform and discharge promptly when due those Liabilities set forth
\nbelow (the “Conoco Environmental Liabilities”):<\/p>\n
(a) Except for (i) Liabilities arising from or
\nrelated to the matters set forth on Schedule 11.1(b) and (ii) Liabilities for
\nthe Environmental Claims or matters identified on Schedule 11.3(d), all
\nLiabilities with respect to all Environmental Claims and Requirements of
\nEnvironmental Law (whether or not<\/p>\n
89
\n 96
\nunder applicable law or regulations which DuPont or any Retained Subsidiary
\nwould have a right of contribution against Conoco or any Transferred Business
\nCompany therefor) relating in any manner to any of the Transferred Environmental
\nAssets, including, but not limited to, any act or omission of any employees or
\nagent thereof;<\/p>\n
(b) All Liabilities, costs or expenses associated
\nwith obtaining or maintaining compliance with Environmental Permits related to
\nthe Conoco Business;<\/p>\n
(c) All Liabilities with respect to any Waste Site
\nnot located on any of the Transferred Environmental Assets into which waste
\nmaterials or Hazardous Substances from any of the Transferred Environmental
\nAssets have been placed prior to the date hereof, or are placed after the date
\nhereof, but into which no waste materials from any of the Retained Environmental
\nAssets have been placed prior to or after the date hereof;<\/p>\n
(d) All Liabilities for the Environmental Claims or
\nmatters identified on Schedule 11.2(d); and<\/p>\n
(e) Liabilities arising from any activities and
\noperations of the DuPont Business and any of the employees thereof (including,
\nbut not limited to the activities and operations of DERS) concerning the matters
\nreferenced in Sections 11.2(a), 11.2(b), 11.2(c) and 11.2(d), to the extent
\nperformed for or on behalf of the Conoco Business.<\/p>\n
Section 11.3 DuPont Environmental Liabilities. On the terms
\nand subject to the conditions set forth in this Agreement, DuPont agrees to pay,
\nperform and discharge promptly when due those Liabilities set forth below, but
\nexcluding in any event all Conoco Environmental Liabilities (the “DuPont
\nEnvironmental Liabilities”):<\/p>\n
(a) Except for (i) Liabilities arising from or
\nrelated to the matters set forth on Schedule 11.1(a) and (ii) Liabilities for
\nEnvironmental Claims or matters identified on Schedule 11.2(d), all Liabilities
\nwith respect to all Environmental Claims and Requirements of Environmental Law
\n(whether or not under applicable law or regulations Conoco or any Transferred
\nBusiness Company would have a right of contribution against DuPont or any
\nRetained Subsidiary therefor) relating in any manner to any of the Retained
\nEnvironmental Assets, including, but not limited, to any act or omission of any
\nemployee or agent thereof;<\/p>\n
90
\n 97
\n (b) All Liabilities, costs or expenses associated
\nwith obtaining or maintaining compliance with Environmental Permits related to
\nthe Retained Business;<\/p>\n
(c) All Liabilities with respect to any Waste Site
\nnot located on any of the Retained Environmental Assets into which waste
\nmaterials or a Hazardous Substance from any of the Retained Environmental Assets
\nhave been placed prior to the date hereof, or are placed after the date hereof,
\nbut into which no waste materials or a Hazardous Substance from any of the
\nTransferred Environmental Assets have been placed prior to or after the date
\nhereof; and<\/p>\n
(d) All Liabilities for the Environmental Claims or
\nmatters identified on Schedule 11.3(d).<\/p>\n
(e) Liabilities arising from any activities and
\noperations of the Conoco Business and any employees thereof concerning the
\nmatters referenced in Sections 11.3(a), 11.3(b), 11.3(c) and 11.3(d), to the
\nextent performed for or on behalf of the DuPont Business.<\/p>\n
Section 11.4 Other Environmental. Notwithstanding anything to
\nthe contrary contained herein, all Liabilities for Environmental Claims with
\nrespect to any Waste Site not located on any of the Transferred Environmental
\nAssets and not located on any of the Retained Environmental Assets (“Third Party
\nSites”) into which (i) waste materials or a Hazardous Substance from the
\nTransferred Environmental Assets have been intentionally placed prior to the
\ndate hereof or are placed on or after the date hereof, and (ii) waste materials
\nor a Hazardous Substance from the Retained Environmental Assets have been
\nintentionally placed prior to the date hereof or are placed on or after the date
\nhereof, shall be allocated as between the parties to this Agreement (a) to
\nConoco in accordance with the ratio of the volume of waste materials or
\nHazardous Substances from the Transferred Environmental Assets to the total
\nvolume of wastes at the site and (b) to DuPont in accordance with the ratio of
\nthe volume of waste materials or Hazardous Substances from the Retained
\nEnvironmental Assets to the total volume of wastes at the site; provided, that
\nConoco, in the case of the Transferred Environmental Assets and DuPont, in the
\ncase of the Retained Environmental Assets, shall bear all transporter
\nliabilities with respect to waste it generated and transported to such Third
\nParty Sites, in cases where transporter services with respect to such wastes
\nwere provided by Sentinel, Inc. or its predecessors.<\/p>\n
91
\n 98
\n Section 11.5 Damages, Awards, Etc. Notwithstanding anything to
\nthe contrary contained in this Agreement, (a) Conoco shall be entitled to any
\nmonies, damages or awards from third parties, including with respect to
\ninsurance, contribution or cost recovery awards, recovered after the Effective
\nDate with respect to Conoco Environmental Liabilities, and (b) DuPont shall be
\nentitled to any monies, damages or awards from third parties, including with
\nrespect to insurance, contribution or cost recovery awards, recovered after the
\nEffective Date with respect to DuPont Environmental Liabilities.<\/p>\n
Section 11.6 Remediation. As between the parties to this
\nAgreement, (a) Conoco will have full authority to control, direct, manage and
\nimplement remediation and to determine its scope, and conduct all negotiations,
\nmeetings and settlements with Governmental Authorities with respect to Conoco
\nEnvironmental Liabilities; provided, however, that Conoco may contract with
\nDuPont on mutually agreeable terms for DuPont to perform any such activities
\nwith respect to Conoco Environmental Liabilities on Conoco’s behalf, and (b)
\nDuPont will have full authority to control, direct, manage and implement
\nremediation and to determine its scope, and conduct all negotiations, meetings
\nand settlements with Governmental Authorities with respect to DuPont
\nEnvironmental Liabilities; provided, however, that DuPont may contract with
\nConoco on mutually agreeable terms for Conoco to perform any such activities
\nwith respect to DuPont Environmental Liabilities on DuPont’s behalf.<\/p>\n
Section 11.7 Exclusive Remedy\/Indemnification. (a)
\nNotwithstanding any Requirements of Environmental Law or the provisions or
\nprinciples of any other statutory or common law including, without limitation,
\nthe Comprehensive Environmental Response, Compensation and Liability Act, as
\namended, and state law analogues, and except with respect to Waste Sites
\naddressed in Section 11.4, the provisions of this Article XI and the
\nindemnification provisions in Article VI shall constitute the parties’ exclusive
\nremedy with respect to each other for all Liabilities pursuant to the
\nRequirements of Environmental Law arising from the ownership of, or conduct of
\nbusiness with respect to, the Transferred Environmental Assets or the Retained
\nEnvironmental Assets.<\/p>\n
(b) Except as otherwise provided in this Article XI
\nor as would be inconsistent herewith the provisions of Sections 6.2(d), (e), (f)
\nand (g), 6.3, 6.4, and 6.6 shall apply to this Article XI and claims for
\nindemnification hereunder.<\/p>\n
ARTICLE XII<\/p>\n
92
\n 99
\n CONDITION TO CONSUMMATION OF DISTRIBUTION; TERMINATION<\/p>\n
Section 12.1 Condition. Consummation of the transactions
\nprovided for in this Agreement and the Related Agreements is conditioned upon,
\nand shall only be effected upon or after, (i) the final approval of the
\nSeparation, the Restructuring and the IPO by the Board of Directors of DuPont
\nand (ii) the closing of the IPO.<\/p>\n
Section 12.2 Termination. This Agreement may be terminated and
\nthe Separation, the Restructuring and the IPO abandoned by the Board of
\nDirectors of DuPont in its sole discretion, without the approval of Conoco at
\nany time prior to the Effective Time. In the event of any such termination, no
\nparty shall have any liability of any kind to any other party.<\/p>\n
ARTICLE XIII<\/p>\n
DISPUTE RESOLUTION<\/p>\n
Section 13.1 Mediation. Except with respect to disputes
\nrelating to Section 8.6 hereof and as provided in Section 13.4 hereof, if a
\ndispute, claim or controversy arises out of or arises in connection with this
\nAgreement, the Related Agreements or any other agreement entered into in
\naccordance with this Agreement, including, but not limited to, the termination
\nor validity thereof or any matter involving a Loss (“Dispute”), DuPont and
\nConoco agree to first use the following procedures, in lieu of either party
\ninitially pursuing other available remedies, to resolve the Dispute.<\/p>\n
Section 13.2 Initiation. A party seeking to initiate the
\nprocedures shall give written notice to the other party, describing briefly the
\nnature of the Dispute. A meeting shall be held between the parties within 10
\ndays of the receipt of such notice, attended by individuals with decision-making
\nauthority regarding the Dispute, to attempt in good faith to negotiate a
\nresolution of such Dispute.<\/p>\n
Section 13.3 Submission to Mediation. If, within 30 days after
\nsuch meeting, the parties have not succeeded in negotiating a resolution of the
\nDispute, DuPont and Conoco agree to refer the matter to a panel consisting of
\none (1) Senior Executive or the delegee thereof from DuPont and one (1) Senior
\nExecutive or the delegee thereof from Conoco (which Senior Executives or
\ndelegees shall not have been directly involved in the Dispute) for review and
\nresolution. Upon such referral, the Senior Executives or delegees shall review
\nthe following<\/p>\n
93
\n 100
\nmaterials provided by DuPont and Conoco: a copy of the terms of this Agreement
\nand a concise (less than 10 page) summary of the basis of each party’s
\ncontentions, including the relevant facts and areas of disagreement. If the
\nDispute cannot be resolved by the Senior Executive panel pursuant to this
\nSection 13.3 within 25 days of the referral of such Dispute, DuPont and Conoco
\nmay then pursue any and all remedies at law or in equity.<\/p>\n
Section 13.4 Provisional Remedies. Notwithstanding the
\nprovisions of this Article XIII, any party may seek from any court having
\njurisdiction hereof any interim, provisional or injunctive relief that may be
\nnecessary to protect the rights or property of any party or maintain the status
\nquo before, during or after the commencement of the mediation process set forth
\nin this Article XIII.<\/p>\n
ARTICLE XIV<\/p>\n
MISCELLANEOUS<\/p>\n
Section 14.1 Complete Agreement. This Agreement, including the
\nSchedules, Annexes, Exhibits and the Related Agreements, shall constitute the
\nentire agreement between DuPont and Conoco with respect to the subject matter
\nhereof and shall supersede all previous negotiations, commitments and writings
\nwith respect to such subject matter.<\/p>\n
Section 14.2 Allocation of Costs and Expenses. DuPont or a
\nRetained Subsidiary shall pay (or, to the extent incurred by and paid for by
\nConoco or any Transferred Business Company following the Effective Date, will
\npromptly reimburse Conoco or such Transferred Business Company for any and all
\namounts so paid) for all Separation Expenses.<\/p>\n
Section 14.3 Governing Law. This Agreement shall be governed
\nby and construed and enforced in accordance with the laws of the State of
\nDelaware (regardless of the laws that might otherwise govern under applicable
\nprinciples of conflicts law) as to all matters, including, without limitation,
\nmatters of validity, construction, effect, performance and remedies.<\/p>\n
Section 14.4 Jurisdiction; Forum. (a) By the execution and
\ndelivery of this Agreement, DuPont and Conoco submit, and agree to cause their
\nrespective Subsidiaries to submit, to the personal jurisdiction of any state or
\nfederal<\/p>\n
94
\n 101
\ncourt in the State of Delaware in any suit or proceeding arising out of or
\nrelating to this Agreement or the Related Agreements.<\/p>\n
(b) To the extent that DuPont or Conoco or any of
\ntheir respective Subsidiaries has or hereafter may acquire any immunity from
\njurisdiction of any Delaware court or from any legal process (whether through
\nservice or notice, attachment prior to judgment, attachment in aid of execution,
\nexecution or otherwise) with respect to itself or its property, DuPont or
\nConoco, as the case may be, hereby irrevocably waives, and agrees to cause their
\nrespective Subsidiaries to waive, such immunity in respect of its obligations
\nwith respect to this Agreement.<\/p>\n
(c) The parties hereto agree that an appropriate,
\nconvenient and non- exclusive forum for any and all disputes between any of the
\nparties hereto or their respective Subsidiaries arising out of this Agreement,
\nthe Related Agreements or the transactions contemplated hereby and thereby shall
\nbe in any state or federal court in the State of Delaware.<\/p>\n
(d) THE PARTIES HERETO AGREE THAT THEY HEREBY
\nIRREVOCABLY WAIVE AND AGREE TO CAUSE THEIR RESPECTIVE SUBSIDIARIES TO WAIVE, THE
\nRIGHT TO TRIAL BY JURY IN ANY ACTION TO ENFORCE, OR INTERPRETING, THE PROVISIONS
\nOF THIS AGREEMENT OR ANY RELATED AGREEMENT.<\/p>\n
Section 14.5 Notices. All notices, requests, demands and other
\ncommunications under this Agreement shall be in writing and, unless otherwise
\nprovided herein, shall be deemed to have been duly given (i) on the date of
\nservice if served personally on the party to whom notice is given, (ii) on the
\nday of transmission if sent via facsimile transmission to the facsimile number
\ngiven below; provided, telephonic confirmation of receipt is obtained promptly
\nafter completion of transmission, (iii) on the business day after delivery to an
\novernight courier service or the Express mail service maintained by the United
\nStates Postal Service; provided, receipt of delivery has been confirmed or (iv)
\non the fifth day after mailing; provided, receipt of delivery is confirmed, if
\nmailed to the party to whom notice is to be given, by first class mail,
\nregistered or certified, postage prepaid, properly addressed and return-receipt
\nrequested, to the party as follows:<\/p>\n
If to DuPont, to:<\/p>\n
E.I. du Pont de Nemours and Company
\n 1007 Market Street
\n Wilmington, DE 19898<\/p>\n
95
\n 102
\n (302) 773-5176
\n Attn: Roger W. Arrington, Esq.
\n Associate General Counsel<\/p>\n
With a copy to:<\/p>\n
Skadden, Arps, Slate, Meagher & Flom, LLP
\n 919 Third Avenue
\n New York, NY 10022
\n (212) 735-2000
\n Attn: Lou R. Kling, Esq.
\n Eileen Nugent Simon, Esq.<\/p>\n
If to Conoco:
\n Conoco Inc.
\n 600 North Dairy Ashford
\n Houston, Texas 77079
\n (281) 293-1440
\n Attn: R. A. Harrington
\n Senior Vice President, Legal, and General Counsel<\/p>\n
With a copy to:
\n Baker & Botts, L.L.P.
\n One Shell Plaza
\n 910 Louisiana
\n Houston, Texas 77002
\n (713) 229-1522
\n Attn: Walter J. Smith, Esq.<\/p>\n
Either party may change its address or fax number by giving the other party
\nwritten notice of its new address in the manner set forth above.<\/p>\n
Section 14.6 Amendment and Modification. This Agreement may be
\namended, modified or supplemented only by written agreement of the parties.<\/p>\n
Section 14.7 Successors and Assigns. This Agreement and all of
\nthe provisions hereof shall be binding upon and inure to the benefit of the
\nparties and their respective successors and permitted assigns, but neither this
\nAgreement nor any of the rights, interests or obligations hereunder shall be
\nassigned by either party without the prior written consent of the other party.<\/p>\n
96
\n 103
\n Section 14.8 No Third Party Beneficiaries. Except for the
\nprovisions of Article VI which are intended to benefit any DuPont Party or
\nConoco Party in accordance with the terms thereof, this Agreement is solely for
\nthe benefit of the parties hereto and their respective Subsidiaries and is not
\nintended to confer upon any other Person except the parties hereto and their
\nrespective Subsidiaries any rights or remedies hereunder.<\/p>\n
Section 14.9 Counterparts. This Agreement may be executed in
\ntwo or more counterparts, each of which shall be deemed an original, but all of
\nwhich together shall constitute one and the same instrument.<\/p>\n
Section 14.10 Interpretation. The Article and Section headings
\ncontained in this Agreement are solely for the purpose of reference, are not
\npart of the agreement of the parties and shall not in any way affect the meaning
\nor interpretation of this Agreement. Whenever any words are used herein in the
\nmasculine gender, they shall be construed as though they were also used in the
\nfeminine gender in all cases where they would so apply.<\/p>\n
Section 14.11 Annexes, Etc. The Annexes and Schedules shall be
\nconstrued with and as an integral part of this Agreement to the same extent as
\nif the same had been set forth verbatim herein.<\/p>\n
Section 14.12 Legal Enforceability. Any provision of this
\nAgreement which is prohibited or unenforceable in any jurisdiction shall, as to
\nsuch jurisdiction, be ineffective to the extent of such prohibition or
\nunenforceability without invalidating the remaining provisions hereof. Any such
\nprohibition or unenforceability in any jurisdiction shall not invalidate or
\nrender unenforceable such provision in any other jurisdiction.<\/p>\n
Section 14.13 Texas Deceptive Trade Practices Act. Each of
\nConoco and DuPont hereby agrees and acknowledges that it is a Business Consumer
\n(as defined in the Texas Deceptive Trade Practices Act-Consumer Protection Act,
\nTEX. BUS. & COM. CODE Section 17.41 et. seq. (the “DTPA”)) with assets of more
\nthan $25 million or is controlled by a corporation or entity with assets of more
\nthan $25 million and therefore does not qualify as a Consumer (as defined in the
\nDTPA) under the DTPA and accordingly may not pursue a DTPA claim in connection
\nwith the Separation and the transactions contemplated by this Agreement,
\nincluding the Schedules, Annexes, Exhibits and Related Agreements. Furthermore,
\nConoco and DuPont agree not to assert the Consumer status of any of its
\nSubsidiaries, Affiliates, insurers, officers, directors, employees, agents
\nand\/or any other Person for purposes<\/p>\n
97
\n 104
\nof pursuing a DTPA claim in connection with the Separation and the transactions
\ncontemplated by this Agreement, including the Schedules, Annexes, Exhibits and
\nRelated Agreements. The parties further agree that to the extent the DTPA is
\napplicable or hereinafter becomes applicable to the Separation or this
\nAgreement, each of Conoco and DuPont hereby waives, to the fullest extent
\npermitted under the law, all provisions of the DTPA.<\/p>\n
Section 14.14 Petrozuata. To the extent any provisions of this
\nAgreement require Conoco to cause or otherwise compel its Subsidiaries to act in
\na particular fashion, these provisions shall not apply to Petrozuata, except to
\nthe extent that Conoco or any of its other Subsidiaries has the contractual
\npower to cause Petrozuata to act in such fashion.<\/p>\n
98
\n 105
\n IN WITNESS WHEREOF, the parties hereto have caused this
\nRestructuring, Transfer and Separation Agreement to be executed and delivered as
\nof the day and year first above written.<\/p>\n
CONOCO INC.<\/p>\n
(Formerly known as Conoco Energy Company)<\/p>\n
By:\/s\/ R.A. Harrington
\n ———————
\n Name:R.A. Harrington Title: Sr. Vice President
\n and General Counsel<\/p>\n
E.I. DU PONT DE NEMOURS AND COMANY <\/p>\n
By:\/s\/ S.M. Stalnecker
\n ———————
\n Name:S.M. Stalnecker Title: Vice President and
\n Treasurer
\n 106
\n EXHIBIT D<\/p>\n
PROMISSORY NOTE, dated as of July 20, 1998, by Conoco Inc., a
\nDelaware corporation (the “Issuer”), in favor of Du Pont Energy Company, a
\nDelaware corporation (the “Payee”).<\/p>\n
Section 1. Principal. Issuer, for value received, hereby
\npromises to pay to the order of Payee, the sum of Seven Billion Five Hundred
\nMillion Dollars ($7,500,000,000) (the “Principal”) and any and all interest
\nthereon as provided in Section 2 below in accordance with the terms hereof.
\nThe Principal shall be repaid in full by the Issuer, without premium or
\npenalty, on January 2, 2000 (the “Final Maturity Date”), to the extent not
\npreviously paid in accordance with Section 3.<\/p>\n
Section 2. Interest. The Issuer agrees to pay interest in
\nrespect of the unpaid Principal from the date hereof until paid in full at a
\nrate equal to 6.0125 percent per annum, such interest to be computed on the
\nbasis of a 360-day year, and paid for the actual number of days elapsed. In
\nthe event that, and for so long as, an Event of Default under Section 7 shall
\nhave occurred and be continuing, the outstanding Principal and, to the extent
\npermitted by law, overdue interest in respect thereof, shall bear interest at a
\nrate per annum equal to the prime rate of J.P. Morgan as in effect in New York
\nCity on the date of the Event of Default (as defined below) plus three
\npercentage points, such interest to be computed on the basis of a 360-day year,
\nand paid for the actual number of days elapsed. Accrued interest on the
\noutstanding Principal amount (up through and including the day prior to any
\npayment other than a payment on the Final Maturity Date) shall be due and
\npayable on the
\n 107
\nFinal Maturity Date and, if payments of Principal are made prior to the Final
\nMaturity Date, including pursuant to Section 3, on the date of any payment of
\nthe Principal and on the date of any acceleration of the payment of the
\nPrincipal pursuant to Section 7.<\/p>\n
Section 3. Payments.<\/p>\n
(a) Mandatory Prepayments. On the first business day
\nafter the date of the receipt thereof by the Issuer or any of its Subsidiaries,
\nan amount equal to 100% of the cash proceeds of (i) contributions received by
\nthe Issuer of proceeds of the issuance of equity securities or the incurrence
\nof Indebtedness by a Parent Company, (ii) the issuance or sale of equity
\nsecurities by the Issuer or any of its Subsidiaries (net of underwriting
\ndiscounts and commissions and other reasonable costs associated therewith, such
\nother reasonable costs to be mutually agreed upon by the Issuer and Payee) and
\n(iii) the incurrence of Indebtedness by the Issuer or any of its Subsidiaries
\n(net of underwriting discounts and commissions and other reasonable costs
\nassociated therewith, such other reasonable costs to be mutually agreed upon
\nby the Issuer and Payee), except for the incurrence of Indebtedness pursuant to
\na revolving credit facility provided to the Issuer by DuPont Energy Company
\n(the “Revolving Credit Facility”), in each case, shall be applied as a
\nmandatory repayment of Principal and accrued interest on the amount of such
\nPrincipal, except to the extent such proceeds are used to repay any other
\nIndebtedness of the Issuer, Conoco Energy Company (“Conoco”) and any of their
\nSubsidiaries (the “Conoco Entities”) to E.I. du Pont de Nemours and Company
\n(“DuPont”) and any of its Subsidiaries (other<\/p>\n
2<\/p>\n
108
\nthan any Conoco Entities) to the extent that both Conoco and Payee consent to
\nthe repayment of such Indebtedness in lieu of payment under this Note.
\nNotwithstanding the foregoing, the provisions of Sections 3(a)(i) and (ii)
\nshall not apply to the net proceeds received from the exercise of stock options
\ngranted to directors, officers and employees of the relevant entity.<\/p>\n
(b) Voluntary Prepayments. The Issuer shall have the
\nright to prepay the Principal and accrued interest on the amount of such
\nPrincipal in whole or in part from time to time, without premium or penalty.<\/p>\n
(c) Method and Place of Payment. All payments under this
\nNote shall be made to the Payee not later than 12:00 noon, New York time, on
\nthe date when due in U.S. dollars in immediately available funds to such
\naccount as may be specified from time to time in writing by the Payee to the
\nIssuer, and any funds received after such time shall, for all purposes hereof,
\nbe deemed to have been paid on the next succeeding business day. Whenever any
\npayment to be made hereunder shall be stated to be due on a day which is not a
\nbusiness day, the due date thereof shall be extended to the next succeeding
\nbusiness day and, with respect to payments of principal, interest shall be
\npayable at the applicable rate during such extension. The Issuer shall not
\nhave any right of setoff or counterclaim, and all payments made by the Issuer
\nhereunder shall be made irrespective of, and without any reduction for, any
\nsetoff or counterclaims.<\/p>\n
Section 4. Representations and Warranties. In order to induce
\nthe Payee to accept the Note, the Issuer makes the following representations
\nand warranties,<\/p>\n
3
\n 109
\nwhich shall survive the execution and delivery of this Note: the Issuer (a) is
\na duly organized and validly existing corporation in good standing under the
\nlaws of the jurisdiction of its incorporation, (b) has the corporate power and
\nauthority to own its property and assets and to transact the business in which
\nit is engaged or presently proposes to engage and (c) has the corporate power
\nand authority to execute, deliver and carry out the terms and provisions of
\nthis Note and has taken all necessary corporate action to authorize the
\nexecution, delivery and performance by it hereof. The Issuer has duly executed
\nand delivered this Note, and this Note constitutes its legal, valid and binding
\nobligation, enforceable in accordance with its terms. Neither the execution,
\ndelivery or performance by the Issuer of this Note nor compliance by it with
\nthe terms and provisions hereof nor the consummation of the transactions
\ncontemplated hereby, (a) will contravene any applicable provision of any law,
\nstatute, rule, regulation (including Regulations U, T and X of the Board of
\nGovernors of the Federal Reserve System), order, writ, injunction or decree of
\nany court or governmental instrumentality or (b) will conflict or be
\ninconsistent with or result in any breach of any of the terms, covenants,
\nconditions or provisions of, or constitute a default under, or result in the
\ncreation or imposition of (or the obligation to create or impose) any lien upon
\nany of the property or assets of the Issuer pursuant to the terms of any
\nindenture, mortgage, deed of trust, agreement or other instrument to which the
\nIssuer is a party or by which it or any of its property or assets is bound or
\nto which it may be subject (other than this Note), or (c) will violate any
\nprovision of the Issuer’s Certificate of Incorporation or By-Laws. The Issuer
\nand its Subsidiaries<\/p>\n
4
\n 110
\nhave incurred no Indebtedness other than the obligations incurred hereunder and
\nthe Indebtedness set forth on Schedules I and II hereto.<\/p>\n
Section 5. Affirmative Covenants. The Issuer covenants and
\nagrees that until the Principal and all other obligations under this Note are
\npaid in full: (a) the Issuer will furnish the Payee within nine (9) business
\ndays after the end of each quarter and eleven (11) business days after the end
\nof each fiscal year, the unaudited balance sheet and income statement, or
\nconsolidated balance sheet and income statement, if any, of the Issuer and its
\nSubsidiaries as at the end of such period in the form and substance consistent
\nwith the current practice of the Issuer; (b) (i) the Issuer shall furnish to
\nthe Payee such financial information or documents in the possession of the
\nIssuer or any of its Subsidiaries as the Payee may reasonably request, (ii)
\nthe Issuer shall furnish to the Payee on a monthly basis such management and
\nother periodic reports related to financial information in the form and
\nsubstance consistent with the current practice of the Issuer and (iii) will
\nprovide the Payee reasonable access to the books and records of the Issuer and
\nany of its Subsidiaries as the Payee may from time to time reasonably request;
\n(c) the Issuer and its Subsidiaries shall keep proper books of record and
\naccount in conformity with GAAP and all requirements of applicable law; and (d)
\nthe Issuer shall, and shall cause each of its Subsidiaries to, comply in all
\nmaterial respects with all applicable laws, rules, statutes, regulations,
\ndecrees and orders of, and all applicable restrictions imposed by, all
\ngovernmental bodies, domestic or foreign, in respect of the conduct of their
\nbusiness and the ownership of their property.<\/p>\n
5
\n 111<\/p>\n
Section 6. Negative Covenants.<\/p>\n
(a) Restriction on Fundamental Changes. Without the
\nPayee’s prior written consent, the Issuer will not, and will not permit its
\nSignificant Subsidiaries to enter into any merger or consolidation, or
\nliquidate, wind-up or dissolve (or suffer any liquidation or dissolution),
\ndiscontinue its business or convey, lease, sell, transfer or otherwise dispose
\nof, in one transaction or series of transactions, all or substantially all of
\nits business or property, whether now or hereafter acquired.<\/p>\n
(b) Limitation on Liens. Without the Payee’s prior
\nwritten consent, the Issuer agrees that neither it nor any of its Subsidiaries
\nwill issue, assume or guarantee any notes, bonds, debentures or other similar
\nevidences of Indebtedness for money borrowed secured by a mortgage, lien,
\npledge or other encumbrance (“Mortgages”) upon any Restricted Property without
\neffectively providing that concurrently with issuance, assumption or guaranty
\nof any such Indebtedness that the Note (together with, if the Issuer so
\ndetermines, any other Indebtedness or obligation then existing or thereafter
\ncreated ranking equally with the Note) shall be secured equally and ratably
\nwith (or prior to) such Indebtedness so long as such Indebtedness shall be so
\nsecured, except that this restriction will not apply to: (i) Mortgages
\nrelating to pollution control or industrial revenue bonds; and (ii) Mortgages
\nrequired by any contract or statute in order to permit the Issuer or any of its
\nSubsidiaries to perform any contract or subcontract made by it with or at the
\nrequest of the United States of America, any state or any department, agency or
\ninstrumentality or political subdivision of either.<\/p>\n
6
\n 112<\/p>\n
The Issuer agrees that if, upon any consolidation or merger of the
\nIssuer with or into any other corporation, or upon any sale or conveyance of
\nall or substantially all of its property to any other corporation, any of the
\nRestricted Property of the Issuer or of any of its Subsidiaries would thereupon
\nbecome subject to any Mortgage, the Issuer will first secure the Note equally
\nand ratably with any obligations of the Issuer or any of its Subsidiaries then
\nentitled thereto, by a direct lien on all such property prior to all liens
\nother than any theretofore existing thereon.<\/p>\n
For the purposes of this Section, the following types of transactions
\nshall not be deemed to create Indebtedness secured by a Mortgage; the sale or
\nother transfer of (i) oil, gas, coal, uranium, copper or other minerals in
\nplace for a period of time until, or in an amount such that, the purchaser will
\nrealize therefrom a specified amount of money (however determined) or a
\nspecified amount of such minerals, or (ii) any other interest in property of
\nthe character commonly referred to as a “production payment”.<\/p>\n
(c) Limitation on Subsidiaries’ Borrowing. Without the
\nprior written consent of the Payee, the Issuer will not permit any of its
\nSubsidiaries to, and the Subsidiaries of the Issuer will not, incur any
\nIndebtedness other than Indebtedness owed to the Issuer or to a wholly owned
\nSubsidiary of the Issuer.<\/p>\n
7
\n 113
\n Section 7. Events of Default. Each of the following events,
\nacts, occurrences or conditions shall constitute an Event of Default under this
\nNote:<\/p>\n
(a) The Issuer shall default in the payment when due
\nof any principal of or interest on the Indebtedness evidenced by this Note and
\nsuch default shall continue for five days.<\/p>\n
(b) Any representation or warranty made by the
\nIssuer herein or in any certificate or statement delivered pursuant hereto
\nshall prove to be false or misleading in any material respect at any time.<\/p>\n
(c) The Issuer shall fail to perform or observe any
\nother agreement, covenant or obligation arising hereunder; provided, that any
\nfailure pursuant to Section 5 hereof shall be continuing fifteen days after
\nnotice thereof to Issuer.<\/p>\n
(d) The Issuer, any of its Subsidiaries or a Parent
\nCompany shall default in the payment when due (whether by scheduled maturity,
\nrequired prepayment, acceleration, demand or otherwise) of any amount owing in
\nrespect of any Indebtedness for borrowed money in excess, in the aggregate, of
\nFifty Million Dollars ($50,000,000) in principal outstanding Indebtedness and
\nsuch default continues after any applicable grace period; or the Issuer, any of
\nits Subsidiaries or a Parent Company shall default in the performance or
\nobservance of any obligation or condition with respect to any such Indebtedness
\nor any other event shall occur or condition shall exist, if the effect of such
\ndefault, event or condition is to accelerate the maturity of any Indebtedness
\nhaving an aggregate principal amount in excess of<\/p>\n
8
\n 114
\nFifty Million Dollars ($50,000,000), or to permit the holder or holders
\nthereof, or any trustee or agent for such holders, to accelerate the maturity
\nof any Indebtedness having an aggregate principal amount in excess of Fifty
\nMillion Dollars ($50,000,000), or any Indebtedness having an aggregate
\nprincipal amount in excess of Fifty Million Dollars ($50,000,000) shall become
\nor be declared to be due and payable prior to its stated maturity other than as
\na result of a regularly scheduled payment.<\/p>\n
(e) (i) The Issuer shall commence a voluntary case
\nconcerning itself under the Bankruptcy Code; or (ii) an involuntary case is
\ncommenced against the Issuer and the petition is not dismissed within 30 days
\nafter commencement of the case; or (iii) a custodian (as defined in the
\nBankruptcy Code) is appointed for, or takes charge of, all or substantially all
\nof the property of the Issuer or the Issuer commences any other proceedings
\nunder any reorganization, arrangement, adjustment of debt, relief of debtors,
\ndissolution, insolvency or liquidation or similar law of any jurisdiction
\nwhether now or hereafter in effect relating to the Issuer or there is commenced
\nagainst the Issuer any such proceeding which remains undismissed for a period
\nof 30 days; or (iv) any order of relief or other order approving any such case
\nor proceeding is entered; or (v) the Issuer is adjudicated insolvent or
\nbankrupt; or (vi) the Issuer suffers any appointment of any custodian or the
\nlike for it or any substantial part of its property to continue undischarged or
\nunstayed for a period of 30 days; or (vii) the Issuer makes a general
\nassignment for the benefit of creditors; or (viii) the Issuer shall fail to
\npay, or shall state that it is unable to pay, its<\/p>\n
9
\n 115
\ndebts generally as they become due; or (ix) the Issuer shall call a meeting of
\nits creditors with a view to arranging a composition or adjustment of its
\ndebts; or (x) the Issuer shall by any act or failure to act consent to, approve
\nof or acquiesce in any of the foregoing; or (xi) any corporate action is taken
\nby the Issuer for the purpose of effecting any of the foregoing; or<\/p>\n
(f) A Change of Control of a Parent Company.<\/p>\n
Upon the occurrence and during the continuance of any Event of
\nDefault, the Payee may in its sole discretion (except in the case of an Event
\nof Default occurring under clause (e) above, in which case the following will
\noccur automatically) declare the unpaid principal amount of and any and all
\naccrued and unpaid interest on the Indebtedness evidenced by this Note and any
\nand all other obligations pursuant to this Note, and the same shall thereupon
\nbe, immediately due and payable with all additional interest from time to time
\naccrued thereon and without presentation, demand, or protest or other
\nrequirements of any kind (including, without limitation, valuation and
\nappraisement, diligence, presentment, notice of intent to demand or accelerate
\nand notice of acceleration), all of which are hereby expressly waived by
\nIssuer.<\/p>\n
Section 8. Payment of Expenses; Indemnity. Except for
\nout-of-pocket costs and expenses incurred by each party in connection with the
\nnegotiation, preparation, execution and delivery of this Note, the Issuer shall
\nindemnify the Payee, its officers, directors, partners, stockholders,
\nemployees, representatives and agents (each an “Indemnitee”) from, and hold
\neach of them harmless against, any and all<\/p>\n
10
\n 116
\nlosses, liabilities, claims, damages, expenses, obligations, penalties,
\nactions, judgments, suits, costs or disbursements of any kind or nature
\nwhatsoever (including, without limitation, the fees and disbursements of
\ncounsel for such Indemnitee in connection with any investigative,
\nadministrative or judicial proceeding commenced or threatened, whether or not
\nsuch Indemnitee shall be designated a party thereto) that may at any time
\n(including, without limitation, at any time following the payment of the
\nobligations) be imposed on, asserted against or incurred by any Indemnitee as a
\nresult of, or arising out of, or in any way related to or by reason of, (i)
\nperformance of this Note and (ii) the exercise by the Payee of its rights and
\nremedies hereunder (but excluding, as to any Indemnitee, any such losses,
\nliabilities, claims, damages, expenses, obligations, penalties, actions,
\njudgments, suits, costs or disbursements incurred solely by reason of the gross
\nnegligence or willful misconduct of such Indemnitee as finally determined by a
\ncourt of competent jurisdiction). The Issuer’s obligations under this
\nparagraph shall survive the termination of this Note and the payment of the
\nobligations.<\/p>\n
Section 9. No Waiver; Remedies Cumulative. No failure or delay
\non the part of the Payee in exercising any right, power or privilege hereunder
\nand no course of dealing between the parties hereto shall operate as a waiver
\nthereof; nor shall any single or partial exercise of any right, power or
\nprivilege hereunder preclude any other or further exercise thereof of the
\nexercise of any other right, power or privilege hereunder. The rights and
\nremedies herein expressly provided are cumulative and not exclusive of any
\nrights or remedies which the Payee would otherwise have. No<\/p>\n
11
\n 117
\nnotice to or demand on the Issuer in any case shall entitle the Issuer to any
\nother or further notice or demand in similar or other circumstances or
\nconstitute a waiver of the rights of the Payee to any other or further action
\nin any circumstances without notice or demand.<\/p>\n
Section 10. Miscellaneous. This Note shall be binding upon and
\ninure to the benefit of the Payee and the Issuer and their respective
\nsuccessors and assigns, except that the Issuer may not assign or transfer any
\nof its rights or obligations under this Note without the prior written consent
\nof the Payee. This Note may not be amended, supplemented, modified or waived
\nexcept in a writing executed by the Issuer and the Payee. The headings of the
\nseveral Sections and subsections of this Note are inserted for convenience only
\nand shall not in any way affect the meaning or construction of any provision of
\nthis Note. In case any provision in or obligation under this Note shall be
\ninvalid, illegal or unenforceable in any jurisdiction, the validity, legality
\nand enforceability of the remaining provisions or obligations, or of such
\nprovision or obligation in any other jurisdiction, shall not in any way be
\naffected or impaired thereby.<\/p>\n
Section 11. Notices. The Issuer agrees that all notices and
\ndeliveries to be made to the Payee pursuant to this Note will be made to the
\nperson and at the address as may be specified from time to time by the Payee to
\nthe Issuer in writing. All notices and deliveries to be made to the Issuer
\npursuant to this Note will be made to the person and at the address as may be
\nspecified from time to time by the Issuer to the Payee in writing.<\/p>\n
12
\n 118
\n Section 12. Certain Definitions.<\/p>\n
As used in this Note, capitalized terms shall have the following meanings (such
\nmeanings to be equally applicable to both the singular and plural forms of the
\nterms defined):<\/p>\n
“Change of Control” with respect to a Parent Company shall occur if
\n(A) the Permitted Holders (x) cease to be the beneficial owner, directly or
\nindirectly, of at least 50% of the aggregate total voting power of each Parent
\nCompany, whether as a result of issuance of securities of a Parent Company, any
\nmerger, consolidation, liquidation or dissolution of a Parent Company, any
\ndirect or indirect transfer of securities by any Permitted Holders or
\notherwise, or (y) do not have the ability by voting power, contract or
\notherwise to elect or designate for election a majority of the Board of
\nDirectors of each Parent Company or (B) the Issuer ceases to be wholly owned,
\ndirectly or indirectly, by each Parent Company. “Permitted Holders” are
\nDuPont, DuPont Energy Company and any other Subsidiary of DuPont.<\/p>\n
As used herein, “control” when used with respect to any specified
\nperson means the power to direct the management and policies of such person,
\ndirectly or indirectly, whether through ownership of voting securities, by
\ncontract or otherwise.<\/p>\n
“GAAP” means United States generally accepted accounting principles in
\neffect from time to time.<\/p>\n
“Indebtedness” of any person shall mean, (a) all obligations of such
\nperson for borrowed money, including Indebtedness under this Note or with
\nrespect to deposits or advances of any kind, (b) all obligations of such person
\nevidenced by<\/p>\n
13
\n 119
\nbonds, debentures, notes or similar instruments, (c) all obligations of such
\nperson upon which interest charges are customarily paid, (d) all obligations of
\nsuch person under conditional sale or other title retention agreements relating
\nto property or assets purchased by such person, (e) all obligations of such
\nperson issued or assumed as the deferred purchase price of property or
\nservices, (f) all Indebtedness of others secured by (or for which the holder of
\nsuch Indebtedness has an existing right, contingent or otherwise, to be secured
\nby) any Mortgage on property owned or acquired by such person, whether or not
\nthe obligations secured thereby have been assumed, (g) all guarantees by such
\nperson of Indebtedness of others which in the aggregate exceed Two Billion
\nDollars ($2,000,000,000) (provided that the Issuer will promptly notify the
\nPayee of the incurrence by the Payee or one of its Subsidiaries of any
\nguarantee of Indebtedness of others), (h) all capital lease obligations of such
\nperson, and (i) all securities or other similar instruments convertible or
\nexchangeable into any of the foregoing, but excluding (1) industrial revenue
\nbonds, (2) operating leases, (3) in the case of the Issuer, the Revolving
\nCredit Facility and (4) daily cash overdrafts associated with routine cash
\noperations.<\/p>\n
“Parent Company” means Conoco Energy Company or any other person that,
\ndirectly or indirectly, through one or more intermediaries, controls the
\nIssuer, other than DuPont, DuPont Energy Company, and other Subsidiaries of
\nDuPont. For purposes of this definition, Conoco Energy Company and its
\nSubsidiaries shall not be deemed to be Subsidiaries of DuPont.<\/p>\n
“Restricted Property” means any shares of capital stock of a Subsidiary
\nof the<\/p>\n
14
\n 120
\nIssuer and any manufacturing plant or facility or any mineral, oil or gas
\nproducing property or any research facility owned by the Issuer or any of its
\nSubsidiaries except any such plant or facility or property or research facility
\nwhich, in the opinion of the Board of Directors of Conoco Energy Company is not
\na material asset of the Issuer or its Subsidiaries within the meaning of GAAP.<\/p>\n
“Significant Subsidiary” shall have the meaning given to such term
\nunder Rule 1-02 of Regulation S-X.<\/p>\n
“Subsidiary” means (a) any corporation at least a majority of the
\noutstanding securities of which having ordinary voting power to elect a
\nmajority of the board of directors of such corporation is at the time owned or
\ncontrolled directly or indirectly by such party and (b) any partnership, joint
\nventure, association, joint stock company, trust, unincorporated organization
\nor other entity, in which such party, directly or indirectly, has the power to
\nelect or direct the election of a majority of the members of the governing body
\nof such entity or otherwise has control over such entity (e.g., as the managing
\npartner of a partnership).<\/p>\n
THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
\nHEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAWS OF
\nTHE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE PRINCIPLES THEREOF RELATING
\nTO CONFLICTS OF LAW).<\/p>\n
15
\n 121<\/p>\n
IN WITNESS WHEREOF, the Issuer has caused its duly authorized
\nofficer to execute and deliver this Note as of the date first above written.<\/p>\n
CONOCO INC.<\/p>\n
By:\/s\/ R.W. Goldman
\n ————————-
\n Name: R.W. Goldman
\n Title: Vice President<\/p>\n
16
\n 122
\n Schedule I to the
\n Promissory Note<\/p>\n
INDEBTEDNESS DOCUMENTATION
\n ————————–<\/p>\n
SCHEDULE OF EXISTING CONOCO INC. AND SUBSIDIARIES DEBT
\nAS OF JUNE 30, 1998<\/p>\n
\n\n($ in millions) FYE 1997 2 QTR 1998
\n ——– ———-
\n
\nSHORT-TERM OBLIGATIONS<\/p>\nCAPITAL LEASES-SHORT-TERM PORTION 2.0 2.0<\/p>\n
CURRENT MATURITIES OF LT DEBT<\/p>\n
K.C. Asphalt L.L.C. 1.0 1.1<\/p>\n
Conoco Mineraloel GMBH 1.7 1.7<\/p>\n
Conoco Development Company 22.5 22.5
\n —- —-
\n 25.2 25.3<\/p>\n
SUBTOTAL-SHORT-TERM DEBT 27.2 27.3<\/p>\n
LONG-TERM OBLIGATIONS<\/p>\n
KC Asphalt L.L.C. 12.9 11.8<\/p>\n
Conoco Mineraloel GMBH 17.3 15.6<\/p>\n
Conoco Development II Inc. 20.0 20.0<\/p>\n
CAPITAL LEASES 32.5 32.5<\/p>\n
SUBTOTAL-LONG-TERM DEBT 82.7 79.9
\n —- —-<\/p>\n
TOTAL DEBT 109.9 107.2<\/p>\n
Minority Interest 309.0 309.0<\/p>\n
TOTAL DEBT W\/ MINORITY INTEREST 418.9 416.2<\/p>\n
<\/c><\/c><\/s><\/caption>\n<\/table>\n
17
\n 123
\n GUARANTY<\/p>\n
Conoco Inc. (formerly Conoco Energy Company) (the
\n“Guarantor”), as primary obligor and not merely as surety, hereby
\nunconditionally guarantees (the “Guarantee”) (i) the due and punctual payment
\nof the principal of and interest on that certain Promissory Note of Conoco Inc.
\ndated July 20, 1998 (the “Note”), subject to any applicable grace periods,
\nwhether at maturity, by acceleration or otherwise, the due and punctual payment
\nof interest on the overdue principal and interest, if any, on the Note, to the
\nextent lawful, and the due and punctual performance of all other obligations of
\nthe Issuer all in accordance with the terms set forth in the Note and (ii) in
\ncase of any extension of time of payment or renewal of the Note or any of such
\nother obligations, that the same will be promptly paid in full when due or
\nperformed in accordance with the terms of the extension or renewal, whether at
\nstated maturity, by acceleration or otherwise (all such obligations guaranteed
\nhereby by the Guarantor being the “Guaranteed Obligations”).<\/p>\n
This Guaranty is irrevocable, absolute, present and
\nunconditional. The Guarantor guarantees that the Guaranteed Obligations will
\nbe paid strictly in accordance with the terms of the Note regardless of any
\nlaw, regulation or order now or hereafter in effect in any jurisdiction
\naffecting any of such terms or the rights of the Payee with respect thereto.
\nThe obligations of the Guarantor under this Guaranty are independent of the
\nGuaranteed Obligations, and a separate action or actions may <\/p>\n
124
\nbe brought and prosecuted against the Guarantor to enforce this Guaranty,
\nirrespective of whether any action is brought against the Issuer or any other
\nguarantor or whether the Issuer or any other guarantor is joined in any such
\naction or actions. The liability of the Guarantor under this Guaranty shall be
\nabsolute and unconditional irrespective of:<\/p>\n
(i) any lack of validity or
\n enforceability of the Note with respect to the Issuer or any agreement
\n or instrument relating thereto;<\/p>\n
(ii) any change in the time, manner or
\n place of payment of, or in any other term of, all or any of the
\n Guaranteed Obligations, or any other amendment or waiver of or any
\n consent to departure from the Note;<\/p>\n
(iii) the failure to give notice to the
\n Guarantor of the occurrence of an Event of Default under the
\n provisions of the Note;<\/p>\n
(iv) any failure, omission, delay by or
\n inability on the part of the Payee to assert or exercise any right,
\n power or remedy conferred on the Payee in the Note;<\/p>\n
(v) any change in the corporate
\n structure, or termination, dissolution, consolidation or merger of the
\n Issuer or any guarantor with or into any other entity, the voluntary
\n or involuntary liquidation, dissolution, sale or other disposition of
\n all or substantially<\/p>\n
2<\/p>\n
125
\n all the assets of the Issuer or the Guarantor, the marshaling of the
\n assets and liabilities of the Issuer or any guarantor, the
\n receivership, insolvency, bankruptcy, assignment for the benefit of
\n creditors, reorganization, arrangement, composition with creditors, or
\n readjustment of, or other similar proceedings affecting the Issuer or
\n any guarantor, or any of the assets of any of them;<\/p>\n
(vi) the assignment of any right, title
\n or interest of the Payee in the Note to any other person; or<\/p>\n
(vii) any other event or circumstance
\n (including any statute of limitations), whether foreseen or unforeseen
\n and whether similar or dissimilar to any of the foregoing, that might
\n otherwise constitute a defense available to, or a discharge of, the
\n Issuer or a guarantor, other than payment in full of the Guaranteed
\n Obligations; it being the intent of the Guarantor that its obligations
\n hereunder shall not be discharged except by payment of all amounts
\n owing pursuant to the Note.<\/p>\n
This Guaranty shall continue to be effective or be reinstated,
\nas the case may be, if at any time any payment or performance with respect to
\nany of the Guaranteed Obligations is rescinded or must otherwise be returned by
\nthe Payee, upon the insolvency, bankruptcy or reorganization of the Issuer or
\notherwise, all as though such payment or performance had not been made or
\noccurred. The obligations of the Guarantor under this Guaranty shall not be
\nsubject to reduction, termina-<\/p>\n
3
\n 126
\ntion or other impairment by any set-off, recoupment, counterclaim or defense or
\nfor any other reason.<\/p>\n
The Guarantor hereby irrevocably waives, to the extent
\npermitted by applicable law:<\/p>\n
(i) promptness, diligence, notice of
\n acceptance and any other notice with respect to any of the Guaranteed
\n Obligations and this Guaranty;<\/p>\n
(ii) any requirement that the Payee or
\n any other person protect, secure, perfect or insure any lien or any
\n property subject thereto or exhaust any right or take any action
\n against the Issuer or any other person or any collateral, or obtain
\n any relief pursuant to the Note or pursue any other available remedy;<\/p>\n
(iii) all right to trial by jury in any
\n action, proceeding or counterclaim arising out of or relating to the
\n Note;<\/p>\n
(iv) any defense arising by reason of
\n any claim or defense based upon an election of remedies by the Payee
\n which in any manner impairs, reduces, releases or otherwise adversely
\n affects its subrogation, contribution or reimbursement rights or other
\n rights to proceed against the Issuer or any other person; and<\/p>\n
(v) any duty on the part of the Payee
\n to disclose to the Guarantor any matter, fact or thing relating to the
\n business, operation or condition of the Issuer and its assets now
\n known or hereafter known by the Payee.<\/p>\n
4
\n 127
\n IN WITNESS WHEREOF, the Guarantor has caused its duly
\nauthorized officer to execute and deliver this Guarantee as of JULY 24, 1998.<\/p>\n
CONOCO INC.<\/p>\n
(FORMERLY CONOCO ENERGY COMPANY)<\/p>\n
By:
\n —————————–
\n Name:
\n Title:<\/p>\n
5
\n 128
\n EXHIBIT K<\/p>\n
REGISTRATION RIGHTS AGREEMENT<\/p>\n
REGISTRATION RIGHTS AGREEMENT dated as of October 27, 1998,
\namong Conoco Inc., a Delaware corporation (the “Company”), and E. I. du Pont de
\nNemours and Company, a Delaware corporation (“Du Pont”).<\/p>\n
W I T N E S S E T H<\/p>\n
WHEREAS, pursuant to a Restructuring, Transfer and Separation
\nAgreement, dated as of , 1998 (the “Separation Agreement”), by and among the
\nCompany, Du Pont and certain subsidiaries of Conoco and Du Pont, and the IPO
\n(as hereinafter defined), the Common Stock (as hereinafter defined) will become
\npublicly traded.<\/p>\n
WHEREAS, the parties hereto desire to set forth the rights of
\nthe Holders (as hereinafter defined) and the obligations of the Company with
\nrespect to the registration of the Registrable Securities (as hereafter
\ndefined) pursuant to the Securities Act (as hereafter defined); and<\/p>\n
WHEREAS, the execution and delivery of this Agreement by the
\nparties hereto is a condition to the obligations of each of Du Pont and Conoco
\nunder the Separation Agreement;<\/p>\n
NOW, THEREFORE, in consideration of the covenants and
\nagreements of Du Pont and Conoco contained herein and in the Separation
\nAgreement and for other good and valuable consideration, the receipt and
\nsufficiency of which are hereby acknowledged, the parties hereto agree as
\nfollows:<\/p>\n
1. Definitions. Capitalized terms used but not otherwise defined
\nherein shall have the meanings assigned to such terms in the Separation
\nAgreement. For purposes of this Agreement the following terms shall have the
\nfollowing meanings:<\/p>\n
“Affiliate” has the meaning assigned to such term under Rule
\n405 of the Securities Act.
\n 129<\/p>\n
“Class B Common Stock” means the shares of Class B common
\nstock, par value $.01 per share, of the Company.<\/p>\n
“Common Stock” means the shares of Class A common stock, par
\nvalue $0.01 per share, of the Company.<\/p>\n
“Continuously Effective,” with respect to a specified
\nRegistration Statement, means that such Registration Statement shall not cease
\nto be effective and available for transfers of Registrable Securities in
\naccordance with the method of distribution set forth therein for longer than
\nfive (5) Business Days during the period specified in the relevant provision of
\nthis Agreement.<\/p>\n
“Exchange Act” means the Securities Exchange Act of 1934, as
\namended from time to time, and the rules and regulations thereunder.<\/p>\n
“Holders” means, collectively, Du Pont and its affiliates
\n(other than the Company and, after giving effect to Section 2.1 of the
\nSeparation Agreement, subsidiaries of the Company) who from time to time own
\nRegistrable Securities; each of such entities separately is sometimes referred
\nto herein as a “Holder.”<\/p>\n
“IPO” means the initial public offering of Shares
\ncontemplated by the Separation Agreement.<\/p>\n
“IPO Closing Date” means the date of the first closing of the
\nsale of shares of Common Stock to the underwriters by the Company pursuant to
\nthe IPO.<\/p>\n
“IPO Restricted Period” means the period, if any, during
\nwhich Du Pont agrees with the Underwriters’ Representative in the IPO not to
\nsell shares of Common Stock or Class B Common Stock, as the same may be waived,
\nshortened or, with the consent of Du Pont, extended.<\/p>\n
“Maximum Number” when used in connection with an underwritten
\noffering, shall mean the maximum number of shares of Common Stock (or amount of
\nother Registrable Securities) that the Underwriters’ Representative has
\ninformed the Company may be included as part of such offering without
\nmaterially and adversely affecting the success or pricing of such offering.<\/p>\n
2<\/p>\n
130<\/p>\n
“Person” shall mean any natural person, firm, individual,
\ncorporation, partnership, limited liability company, joint venture, business
\ntrust, association, trust, company or other organization or entity, whether
\nincorporated or unincorporated.<\/p>\n
“Pre-Demand Period” means a period commencing on the IPO
\nClosing Date and ending on the earlier of (i) the first date as of which all
\nRegistrable Securities cease to be Registrable Securities and (ii) the date
\nwhich is the second anniversary of the effectiveness of a Shelf Registration
\nStatement pursuant to Section 3(a) hereof.<\/p>\n
“Prospectus” means the prospectus included in a Registration
\nStatement, as amended or supplemented by any prospectus supplement with respect
\nto the terms of the offering of any portion of the Registrable Securities
\ncovered by such Registration Statement and by all other amendments and
\nsupplements to the prospectus, including post-effective amendments and all
\nmaterial incorporated by reference in such prospectus.<\/p>\n
“Registrable Securities” means, collectively, (i) the shares
\nof Common Stock into which shares of Class B Common Stock owned by Du Pont
\nimmediately following the IPO Closing Date are convertible pursuant to the
\nCompany’s certificate of incorporation(the “Shares”), (ii) any stock or other
\nsecurities into which or for which the Shares may hereafter be changed,
\nconverted or exchanged and (iii) any other securities issued or distributed in
\nrespect of the Shares by way of stock dividend or stock split or in connection
\nwith a combination of shares, recapitalization, reorganization, merger,
\nconsolidation or otherwise, (iv) any other securities into which or for which
\nshares of Class B Common Stock are converted or exchanged or are convertible or
\nexchangeable, (v) any other successor securities received in respect of any of
\nthe foregoing (i) through (iv); provided that in the event that any Registrable
\nSecurities (as defined without giving effect to this proviso) are being
\nregistered pursuant hereto, the Holder may include in such registration (subject
\nto the limitations of this Agreement otherwise applicable to the inclusion of
\nRegistrable Securities) any shares of Common Stock or Class B Common Stock or
\nsecurities acquired in respect thereof thereafter acquired by such Holder, which
\nshall also be deemed to be “Shares”, and accordingly Registrable Securities, for
\npurposes of such registration.<\/p>\n
“Registration Expenses” means any and all out-of-pocket
\nexpenses incident to performance of or compliance with this Agreement,
\nincluding, without limitation, (i) all SEC and securities exchange registration
\nand filing fees, (ii) all fees<\/p>\n
3
\n 131
\nand expenses of complying with securities or blue sky laws (including fees and
\ndisbursements of counsel for any underwriters in connection with blue sky
\nqualifications of the Registrable Securities) or relating to the National
\nAssociation of Securities Dealers, Inc. (the “NASD”), (iii) all printing,
\nmessenger and delivery expenses, (iv) all fees and expenses incurred in
\nconnection with the listing of the Registrable Securities on any securities
\nexchange pursuant to Section 7(h), (v) the fees and disbursements of counsel for
\nthe Company and of its independent public accountants, (vi) all expenses in
\nconnection with the preparation, printing and filing of the Registration
\nStatement, any preliminary Prospectus or final Prospectus and amendments and
\nsupplements thereto and the mailing and delivering of copies thereof to any
\nHolders, underwriters and dealers and all expenses incidental to delivery of the
\nRegistrable Securities, (vii) subject to the limitations set forth in Section 8,
\nthe reasonable fees and disbursements of counsel, other than the Company’s
\ncounsel, selected by the Holders of the Registrable Securities being registered,
\n(viii) any fees and disbursements of underwriters customarily paid by the
\nissuers or sellers of securities, and the reasonable fees and expenses of any
\nspecial experts retained in connection with the requested registration, but
\nexcluding underwriting discounts and commissions and transfer taxes, if any, and
\n(ix) the expenses incurred in connection with making “roadshow” presentations
\nand holding meetings with potential investors to facilitate the distribution and
\nsale of Registrable Securities.<\/p>\n
“Registration Statement” means any registration statement of
\nthe Company which covers Registrable Securities pursuant to the provisions of
\nthis Agreement, including the Prospectus, amendments and supplements to such
\nregistration statements including post-effective amendments, and all exhibits
\nand all material incorporated by reference in such Registration Statement.<\/p>\n
“Related Securities” means any securities of the Company
\nsimilar or identical to any of the Registrable Securities including, without
\nlimitation, Common Stock, Class B Common Stock and all options, warrants,
\nrights and other securities convertible into, or exchangeable or exercisable
\nfor Common Stock or Class B Common Stock (other than any of the foregoing to be
\noffered or sold to officers, directors or employees as compensation).<\/p>\n
“Securities Act” means the Securities Act of 1933, as amended
\nfrom time to time, and the rules and regulations thereunder.<\/p>\n
“SEC” means the Securities and Exchange Commission.<\/p>\n
4
\n 132<\/p>\n
“Shelf Registration Statement” means a Registration Statement
\nfiled with the SEC for an offering to be made on a continuous basis pursuant to
\nRule 415 under the Securities Act (or any similar rule that may be adopted by
\nthe SEC) covering some or all of the Registrable Securities, as applicable.<\/p>\n
“Underwritten Registration or Underwritten Offering” shall
\nmean a registration in which securities of the Company are sold to one or more
\nunderwriters for reoffering to the public.<\/p>\n
“Underwriters’ Representative” when used in connection with
\nan Underwritten Offering, shall mean the managing underwriter of such offering,
\nor, in the case of a co-managed underwriting, the managing underwriter
\ndesignated as the Underwriters’ Representative by the co-managers.<\/p>\n
2. Securities Subject to This Agreement. The securities
\nentitled to the benefits of this Agreement are the Registrable Securities. For
\nthe purposes of this Agreement, Registrable Securities will cease to be
\nRegistrable Securities when (i) a Registration Statement covering such
\nRegistrable Securities has been declared effective under the Securities Act and
\nthey have been disposed of pursuant to such effective Registration Statement,
\n(ii) such Registrable Securities are distributed to the public pursuant to Rule
\n144 (or any similar provision then in force) under the Securities Act, (iii)
\nsuch Registrable Securities shall have been otherwise transferred to a person
\nwho is not a Holder, or (iv) such Registrable Securities shall have ceased to
\nbe outstanding.<\/p>\n
3. Registration Under the Securities Act.<\/p>\n
(a) Shelf Registration. Within 120 days after the IPO
\nClosing Date, the Company shall file and use its best efforts to cause to
\nbecome effective not later than the later of (i) the 150th day after the IPO
\nClosing Date and (ii) the end of the IPO Restricted Period, a Shelf
\nRegistration Statement on any appropriate form for all the Registrable
\nSecurities, which form shall be available for the sale of the Registrable
\nSecurities in accordance with the intended method or methods of distribution
\nthereof, as specified by Du Pont (including pursuant to one or more
\nUnderwritten Offerings); provided that at the request of the Holders, the
\nfiling and effectiveness of the Shelf Registration Statement may be delayed for
\nsuch a period as the Holders request. The Company agrees to use its best
\nefforts, taking into account the unavailability of incorporation by reference
\nduring the portion of the Pre-Demand Period prior to the Company’s becoming
\neligible to use Form S-3, to keep such<\/p>\n
5
\n 133
\nRegistration Statement Continuously Effective and usable for resale of
\nRegistrable Securities, for a period of twenty-four (24) months from the date on
\nwhich the SEC declares such Registration Statement effective or such shorter
\nperiod which will terminate when all the Registrable Securities covered by such
\nRegistration Statement cease to be Registrable Securities; provided, however,
\nthat the Company may elect that such Registration Statement not be filed or
\nusable during any Blackout Period (as defined in Section 4). No incidental or
\npiggyback registration rights shall be available to any Person (including the
\nCompany) with respect to the Shelf Registration Statement, and no Person
\n(including the Company) shall have the right to have any securities other than
\nthe Registrable Securities included therein or registered thereon.<\/p>\n
The registration rights granted pursuant to the provisions of
\nthis Section 3(a) shall be in addition to the registration rights granted
\npursuant to the other provisions of this Section 3 and the number of Demand
\nRegistrations provided pursuant to Section 3(b) below shall not be reduced by
\nreason of any underwritten offerings effected pursuant to the Shelf
\nRegistration.<\/p>\n
(b) Required Registration.<\/p>\n
(i) In addition to the registration permitted pursuant to
\nSection 3(a), the Holders shall have the right after the expiration of the
\nPre-Demand Period to request in writing (a “Request”) (which Request shall
\nspecify the Registrable Securities intended to be disposed of by such Holders
\nand the intended method of distribution thereof) that the Company register such
\nportion of such Holders’ Registrable Securities as shall be specified in the
\nRequest (a “Demand Registration”) by filing with the SEC, as soon as
\npracticable thereafter, but, not later than the 30th day (or the 45th day if
\nthe applicable registration form is other than Form S-3) after the receipt of
\nsuch a Request by the Company, a registration statement (a “Demand Registration
\nStatement”) covering such Registrable Securities, and the Company shall use its
\nbest efforts to have such Demand Registration Statement declared effective by
\nthe SEC as soon as practicable thereafter, but in no event later than the 75th
\nday (or the 90th day if the applicable registration form is other than Form
\nS-3) after the receipt of such a Request, and to keep such Demand Registration
\nStatement Continuously Effective for a period of at least 60 days following the
\ndate on which such Demand Registration Statement is declared effective, as
\nextended by the length of any Suspension Period (as defined in Section 7) with
\nrespect thereto (or for such shorter period which will terminate when all of
\nthe Registrable Securities covered by such Demand Registration Statement shall
\nhave been sold pursuant thereto), including,<\/p>\n
6
\n 134
\nif necessary, by filing with the SEC a post-effective amendment or a supplement
\nto the Demand Registration Statement or the related prospectus or any document
\nincorporated therein by reference or by filing any other required document or
\notherwise supplementing or amending the Demand Registration Statement, if
\nrequired by the rules, regulations or instructions applicable to the
\nregistration form used by the Company for such Demand Registration Statement or
\nby the Securities Act, the Exchange Act, any state securities or blue sky laws,
\nor any rules and regulations thereunder; provided that such period during which
\nthe Demand Registration Statement shall remain Continuously Effective shall, in
\nthe case of an Underwritten Offering, be extended for such period (if any) as
\nthe underwriters shall reasonably require, including to satisfy, in the judgment
\nof counsel to the underwriters, any prospectus delivery requirements imposed by
\napplicable law.<\/p>\n
The Company shall not be obligated to effect more than three
\n(3) Demand Registrations pursuant to Requests. For purposes of the preceding
\nsentence, a Demand Registration shall not be deemed to have been effected, (i)
\nunless a Demand Registration Statement with respect thereto has become
\neffective, (ii) if after such Demand Registration Statement has become
\neffective, the offer, sale or distribution of Registrable Securities thereunder
\nis prevented by any stop order, injunction or other order or requirement of the
\nSEC or other Governmental Entity for any reason not attributable to any Holder
\nand such effect is not thereafter eliminated, or (iii) if the conditions to
\nclosing specified in the underwriting agreement entered into in connection with
\nsuch Registration are not satisfied or waived, other than by reason of a failure
\non the part of any Holder. If the Company shall have complied with its
\nobligations under this Agreement, a right to a Demand Registration pursuant to
\nthis Section 3 shall be deemed to have been satisfied upon the earlier of (x)
\nthe date as of which all of the Registrable Securities included therein shall
\nhave been sold to the underwriters or distributed pursuant to the Demand
\nRegistration Statement, and (y) the date as of which such Demand Registration
\nshall have been Continuously Effective for a 60-day period or other period
\nspecified in the preceding paragraph following the effectiveness of such Demand
\nRegistration Statement.<\/p>\n
Any Request made pursuant to this Section 3(b) shall be
\naddressed to the attention of the Secretary of the Company, and shall specify
\n(a) the number of Registrable Securities to be Registered (which shall be not
\nless than the lesser of (i) 5% of the total number of shares of Common Stock
\nand Class B Common Stock outstanding or (ii) the remaining balance of the
\nRegistrable Securities then held by the Holders, provided that the aggregate
\npublic offering price of the Registrable Securities to be registered (based on
\nthe closing sale price of the Common Stock on<\/p>\n
7
\n 135<\/p>\n
the last trading day prior to the delivery of a Request) would not be less than
\n$500 million), (b) the intended method of distribution thereof and (c) that
\nthe request is for a Demand Registration pursuant to this Section 3.1(b).<\/p>\n
(ii) The Company may not include in a Demand Registration
\npursuant to Section 3(b)(i)1 hereof shares of Common Stock for the account of
\nthe Company or any subsidiary of the Company, but, if and to the extent
\nrequired by a contractual obligation, may, subject to compliance with Section
\n3.1(b)(iii), include shares of Common Stock for the account of any other Person
\nwho holds shares of Common Stock entitled to be included therein; provided,
\nhowever, that if the Underwriters’ Representative of any offering described in
\nthis Section 3(b) shall have informed the Company in writing that in its
\njudgment there is a Maximum Number of shares of Common Stock that all Holders
\nand any other Persons desiring to participate in such Registration may include
\nin such offering, then the Company shall include in such Demand Registration
\nall Registrable Securities requested to be included in such Registration by the
\nHolders together with up to such additional number of shares of Common Stock
\nthat any other Persons entitled to participate in such Registration desire to
\ninclude in such Registration up to the Maximum Number that the Underwriters’
\nRepresentative has informed the Company may be included in such Registration
\nwithout materially and adversely affecting the success or pricing of such
\noffering; provided that the number of shares of Common Stock to be offered for
\nthe account of all such other Persons participating in such Registration shall
\nbe reduced in a manner determined by the Company in its sole discretion.<\/p>\n
(iii) No Holder may participate in any underwritten offering
\nunder Section 3 hereof and no other Person shall be permitted to participate in
\nany such offering pursuant to Section 3(b) or Section 4 hereof unless it
\ncompletes and executes all customary questionnaires, powers of attorney, custody
\nagreements, underwriting agreements, and other customary documents required
\nunder the customary terms of such underwriting arrangements. In connection with
\nany underwritten offering under Section 3 or Section 4 hereof, each
\nparticipating Holder and the Company and, except in the case of Section 3(a)
\nhereof, each other Person shall be a party to the underwriting agreement with
\nthe underwriters and may be required to make certain customary representations
\nand warranties and provide certain customary indemnifications for the benefit of
\nthe underwriters; provided that the Holders shall not be required to make
\nrepresentations and warranties with respect to the Company and its subsidiaries
\nor their business and operations and shall not be required to agree to any
\nindemnity or contribution provisions less favorable to them than as are set
\nforth herein.<\/p>\n
8
\n 136<\/p>\n
(c) Incidental Registration.<\/p>\n
(i) If at any time the Company proposes to register any
\nRelated Securities under the Securities Act (other than in connection with any
\nacquisition or business combination transaction and other than in connection
\nwith stock options and other stock-based employee benefit plans and
\ncompensation) either in connection with a primary offering for cash for the
\naccount of the Company, a secondary offering or a combined primary and secondary
\noffering, the Company will each time it intends to effect such a registration,
\ngive written notice (a “Company Notice”) to all Holders of Registrable
\nSecurities at least 10 business days prior to the initial filing of a
\nregistration statement with the SEC pertaining thereto, informing such Holders
\nof its intent to file such registration statement and of the Holders’ right to
\nrequest the registration of the Registrable Securities held by the Holders. Upon
\nthe written request of the Holders made within 7 business days after any such
\nCompany Notice is given (which request shall specify the Registrable Securities
\nintended to be disposed of by such Holder and, unless the applicable
\nregistration is intended to effect a primary offering of Common Stock for cash
\nfor the account of the Company, the intended method of distribution thereof),
\nthe Company will use its best efforts to effect the registration under the
\nSecurities Act of all Registrable Securities which the Company has been so
\nrequested to register by the Holders to the extent required to permit the
\ndisposition (in accordance with the intended methods of distribution thereof or,
\nin the case of a registration which is intended to effect a primary offering for
\ncash for the account of the Company, in accordance with the Company’s intended
\nmethod of distribution) of the Registrable Securities so requested to be
\nregistered, including, if necessary, by filing with the SEC a post-effective
\namendment or a supplement to the registration statement filed by the Company or
\nthe related prospectus or any document incorporated therein by reference or by
\nfiling any other required document or otherwise supplementing or amending the
\nregistration statement filed by the Company, if required by the rules,
\nregulations or instructions applicable to the registration form used by the
\nCompany for such registration statement or by the Securities Act, any state
\nsecurities or blue sky laws, or any rules and regulations thereunder; provided,
\nhowever, that if, at any time after giving written notice of its intention to
\nregister any securities and prior to the effective date of the registration
\nstatement filed in connection with such registration, the Company shall
\ndetermine for any reason not to register or to delay such registration of the
\nsecurities, the Company shall give written notice of such determination to each
\nHolder of Registrable Securities and, thereupon, (A) in the case of a
\ndetermination not to register, the Company shall be relieved of its obligation
\nto register any Registrable Securities in connection with such registration (but
\nnot from its obligation to pay the Registration Expenses<\/p>\n
9
\n 137<\/p>\n
incurred in connection therewith), and (B) in the case of a determination to
\ndelay such registration, the Company shall be permitted to delay registration
\nof any Registrable Securities requested to be included in such registration
\nstatement for the same period as the delay in registering such other
\nsecurities.<\/p>\n
The registration rights granted pursuant to the provisions of
\nthis Section 3(c) shall be in addition to the registration rights granted
\npursuant to the other provisions of this Section 3.<\/p>\n
(ii) If, in connection with a Registration Statement
\npursuant to this Section 3(c), the Underwriters’ Representative of the offering
\nregistered thereon shall inform the Company in writing that in its opinion there
\nis a Maximum Number of shares of Common Stock that may be included therein; then
\n(a) in the event such Registration Statement relates to an offering initiated by
\nthe Company of Common Stock being offered for the account of the Company, the
\nCompany may include in such registration the number of shares it proposes to
\noffer and, if such number is less than the Maximum Number, then the number of
\nshares of Common Stock requested to be included by any Person other than the
\nCompany may be reduced, pro rata in proportion to the respective number of
\nshares of Common Stock requested to be included by such Persons (other than any
\nPerson in respect of whom such reduction would place the Company in breach of
\nany then existing contractual obligations that it might have), to the extent
\nnecessary to reduce the respective total number of shares of Common Stock
\nrequested to be included in such offering to the Maximum Number of shares of
\nCommon Stock recommended by such Underwriters’ Representative and (b) in the
\nevent such a Registration Statement is initiated by any Person other than the
\nCompany, such Person shall have the right, in its sole discretion, to include in
\nsuch registration the number of shares of Common Stock it proposes to offer and,
\nif such number is less than the Maximum Number, then the number of shares of
\nCommon Stock requested to be included by any other Person may be reduced pro
\nrata in proportion to the respective number of shares of Common Stock requested
\nto be included by such other Persons (other than any Person in respect of whom
\nsuch reduction would place the Company in breach of any then existing
\ncontractual obligations that it might have), to the extent necessary to reduce
\nthe respective total number of shares of Common Stock requested to be included
\nin such offering to the Maximum Number.<\/p>\n
4. Blackout Period. The Company shall be entitled to
\nelect that a Registration Statement not be usable, or that the filing thereof
\nbe delayed beyond the time otherwise required, for a reasonable period of time,
\nbut not in excess of 60 days<\/p>\n
10
\n 138
\n(a “Blackout Period”), if the Company determines in good faith that the
\nregistration and distribution of Registrable Securities (or the use or filing of
\nthe Registration Statement or related Prospectus) would interfere with any
\npending material financing, acquisition, corporate reorganization or any other
\nmaterial corporate development involving the Company or any of its subsidiaries
\nor would require premature disclosure thereof and promptly gives the Holders of
\nRegistrable Securities written notice of such determination, and if requested by
\nHolders, the Company will promptly deliver to it a general statement of the
\nreasons for such postponement or restriction on use and to the extent
\npracticable an approximation of the anticipated delay; provided, however, that
\nthe aggregate number of days included in all Blackout Periods, when taken
\ntogether with any Suspension Periods (as defined in Section 7), during any
\nconsecutive 12 months shall not exceed 90 days.<\/p>\n
5. Selection of Underwriters.<\/p>\n
If any offering pursuant to a Shelf Registration Statement or
\na Demand Registration Statement is an underwritten offering, Du Pont will
\nselect a managing underwriter or underwriters to administer the offering, which
\nmanaging underwriter or underwriters shall be reasonably satisfactory to the
\nCompany (it being agreed that Morgan Stanley & Co. Incorporated, Credit Suisse
\nFirst Boston Corporation and J.P. Morgan Securities Inc. are satisfactory to
\nthe Company).<\/p>\n
6. Holdback Agreement.<\/p>\n
(a) If so requested by the Underwriters’ Representative in
\nconnection with an offering of securities covered by a registration statement
\nfiled by the Company, whether or not Registrable Securities of the Holders are
\nincluded therein, each Holder shall agree not to effect any sale or distribution
\nof the Shares, including a sale pursuant to Rule 144, without the prior written
\nconsent of the Underwriters’ Representative (except as part of such Underwritten
\nRegistration), during the 7-day period prior to, and during the 90-day
\nperiod beginning on, the date such registration statement is declared effective
\nunder the Securities Act by the SEC; provided that the Holders are timely
\nnotified of such effective date in writing by the Company or the Underwriters’
\nRepresentative. The Holders shall not be subject to the restrictions set forth
\nin this Section 6(a) for longer than 97 days during any 12-month period and a
\nHolder shall no longer be subject to such restrictions at such time as such
\nHolder together with its affiliates shall own less than 5% of the then
\noutstanding shares of Common Stock on a fully-diluted basis.<\/p>\n
11
\n 139<\/p>\n
(b) If so requested by the Underwriters’ Representative in
\nconnection with an offering of any Registrable Securities, the Company shall
\nagree not to effect any sale or distribution of shares of Common Stock, without
\nthe prior written consent of the Underwriters’ Representative (other than as a
\npart of such offering or in connection with any acquisition or business
\ncombination transaction and other than in connection with stock options and
\nemployee benefit plans and compensation) during the 7-day period prior to, and
\nduring the 90-day period beginning on, the date such registration statement is
\ndeclared effective under the Securities Act by the SEC and shall use its best
\nefforts to obtain and enforce similar agreements from any other Persons if
\nrequested by the Underwriters’ Representative; provided that the Company or such
\nPersons shall not be subject to the restrictions set forth in this Section 6(b)
\nfor longer than 97 days during any 12-month period.<\/p>\n
(d) Notwithstanding anything else in this Section 6 to the
\ncontrary, no Holder shall be precluded from distributing to any or all of its
\nstockholders any or all of the Registrable Securities.<\/p>\n
(e) As used in paragraphs (a) and (b) of this Section 6,
\n“sales” or “distributions” shall be deemed to include, to the extent requested
\nby the Underwriters’ Representative, (1) contracts to sell, sales of options or
\ncontracts to purchase, purchases of any option or contract to sell, grants of
\noptions, rights or warrants to purchase or otherwise transfer or dispose of,
\ndirectly or indirectly, any of the Shares or any securities convertible into or
\nexercisable or exchangeable for the Shares and (2) swaps or other arrangements
\nthat transfer to another, in whole or in part, any of the economic consequences
\nof ownership of the Shares, whether any such transaction described in clause (1)
\nor (2) above is to be settled by delivery of the Shares or such other
\nsecurities, in cash or otherwise.<\/p>\n
7. Registration Procedures. If and whenever the Company
\nis required to or to use its best efforts to effect or cause the registration
\nof any Registrable Securities under the Securities Act as provided in this
\nAgreement, the Company will, as expeditiously as possible and without limiting
\nany time period or obligation set forth elsewhere in this Agreement:<\/p>\n
(a) Prepare and file with the SEC a Registration Statement
\nwith respect to such Registrable Securities on a form for which the Company
\nthen qualifies, and which form shall be available for the sale of the
\nRegistrable Securities in accordance with the intended methods of distribution
\nthereof, and use its best efforts to cause such Registration Statement to
\nbecome and<\/p>\n
12
\n 140
\nremain effective; provided that, a reasonable time before filing a Registration
\nStatement or Prospectus, or any amendments or supplements thereto (other than
\nreports required to be filed by it under the Exchange Act and the rules and
\nregulations adopted by the SEC thereunder), the Company will furnish to the
\nHolders and their counsel for review and comment, copies of all documents
\nproposed to be filed and provided further, that if Du Pont so requests (x) it
\nand its counsel and other representatives may participate in the drafting and
\npreparation of such Registration Statement and (y) such information as its
\nbelieves may be beneficial to be included in the Registration Statement for
\nmarketing purposes shall be included therein so long as disclosure of such
\ninformation (1) is in compliance with applicable law and (2) does not
\ncompetitively harm the Company;<\/p>\n
(b) prepare and file with the SEC amendments and
\npost-effective amendments to each such Registration Statement and such
\namendments and supplements to the Prospectus used in connection therewith as
\nmay be required by the Securities Act or the Exchange Act or otherwise
\nnecessary to keep the Registration Statement effective for the applicable
\nperiod and cause the Prospectus as so supplemented to be filed pursuant to Rule
\n424 under the Securities Act, and to otherwise comply with the provisions of
\nthe Securities Act with respect to the disposition of all securities covered by
\nsuch Registration Statement until such time as all of such securities have been
\ndisposed of in accordance with the intended methods of disposition set forth in
\nsuch Registration Statement and Prospectus or such earlier time as the Company’s
\nobligations to maintain the effectiveness and availability for use of such
\nRegistration Statement ceases;<\/p>\n
(c) furnish to each Holder of such Registrable Securities
\nsuch number of copies of such Registration Statement and of each amendment and
\npost-effective amendment thereto (in each case including all exhibits), the
\nProspectus and Prospectus supplement, as applicable, and such other documents as
\nsuch Holder may reasonably request in order to facilitate the disposition of the
\nRegistrable Securities by such Holder (the Company hereby consenting to the use
\n(subject to the limitations set forth in the last paragraph of this Section 7)
\nof the Prospectus or any amendment or supplement thereto in connection with such
\ndisposition);<\/p>\n
(d) use its best efforts to register or qualify such
\nRegistrable Securities covered by such Registration Statement under such other
\nsecurities or<\/p>\n
13
\n 141<\/p>\n
blue sky laws of such jurisdictions as each Holder shall reasonably request,
\nand do any and all other acts and things which may be reasonably necessary or
\nadvisable to enable such Holder to consummate the disposition in such
\njurisdictions of the Registrable Securities owned by such Holder, except that
\nthe Company shall not for any such purpose be required to qualify generally to
\ndo business as a foreign corporation in any jurisdiction where, but for the
\nrequirements of this Section 7(d), it would not be obligated to be so
\nqualified, to subject itself to taxation in any such jurisdiction, or to
\nconsent to general service of process in any such jurisdiction;<\/p>\n
(e) notify each Holder of any such Registrable Securities
\ncovered by such Registration Statement, at any time when a Prospectus relating
\nthereto is required to be delivered under the Securities Act within the
\nappropriate period mentioned in Section 7(b), of the Company’s becoming aware
\nthat the Prospectus included in such Registration Statement, as then in effect,
\nincludes an untrue statement of a material fact or omits to state a material
\nfact required to be stated therein or necessary to make the statements therein,
\nin light of the circumstances under which they were made, not misleading, then
\nexisting, and at the request of any such Holder, prepare and furnish to such
\nHolder a reasonable number of copies of an amendment or supplement to the
\nRegistration Statement or related Prospectus as may be necessary so that, as
\nthereafter delivered to the purchasers of such Registrable Securities, such
\nProspectus shall not include an untrue statement of a material fact or omit to
\nstate a material fact required to be stated therein or necessary to make the
\nstatements therein, in light of the circumstances under which they were made,
\nnot misleading;<\/p>\n
(f) notify each Holder of Registrable Securities covered
\nby such Registration Statement at any time,<\/p>\n
(1) when the Prospectus or any Prospectus supplement
\n or post-effective amendment has been filed, and, with respect
\n to the Registration Statement or any post-effective amendment,
\n when the same has become effective,<\/p>\n
(2) of any request by the SEC for amendments or
\n supplements to the Registration Statement or the Prospectus
\n or for additional information, and of any comments, oral or
\n written, by the SEC with respect thereto,<\/p>\n
14
\n 142<\/p>\n
(3) of the issuance by the SEC of any stop order
\n suspending the effectiveness of the Registration Statement or
\n the initiation of any proceedings for that purpose,<\/p>\n
(4) if at any time the representations and warranties
\n of the Company made pursuant to agreements contemplated by
\n paragraph (i)(1) below cease to be true and correct, and<\/p>\n
(5) of the receipt by the Company of any notification
\n with respect to the suspension of qualification or exemption
\n from qualification of the Registrable Securities for offering
\n or sale in any jurisdiction or the initiation or threatening
\n of any proceeding for such pur pose;<\/p>\n
(g) otherwise use its best efforts to make available to
\nits security holders, as soon as reasonably practicable (but not more than
\neighteen months) after the effective date of the Registration Statement, an
\nearnings statement which shall satisfy the provisions of Section 11(a) of the
\nSecurities Act and the rules and regulations promulgated thereunder;<\/p>\n
(h) cause all such Registrable Securities to be listed on
\nany securities exchange on which the Common Stock is then listed, if such
\nRegistrable Securities are not already so listed and if such listing is then
\npermitted under the rules of such exchange, and to provide a transfer agent,
\nCUSIP number and registrar for such Registrable Securities covered by such
\nRegistration Statement no later than the effective date of such Registration
\nStatement;<\/p>\n
(i) enter into agreements (including underwriting
\nagreements) and take all other appropriate actions in order to expedite or
\nfacilitate the disposition of such Registrable Securities as is customarily made
\nor done by issuers of comparable standing in connection with comparable
\nofferings and in such connection (to the extent so customary):<\/p>\n
(1) make such representations and warranties to the
\n Holders of such Registrable Securities and the underwriters,
\n if any, and agree to such indemnification and contribution
\n agreements, in form, substance and scope as are customarily
\n made by issuers to underwriters in comparable underwritten
\n offerings;<\/p>\n
15
\n 143<\/p>\n
(2) obtain opinions of counsel to the Company (which
\n counsel and opinions (in form, scope and substance) shall be
\n reasonably satisfactory to the underwriters, if any, and the
\n Holders of the Registrable Securities being sold) addressed
\n to each Holder and the underwriters, if any, covering the
\n matters customarily covered in opinions requested in
\n comparable underwritten offerings and such other matters as
\n may be reasonably requested by such Holders and underwriters;<\/p>\n
(3) obtain comfort letters and updates thereof from
\n the Company’s independent accountants addressed to the
\n selling Holders of Registrable Securities and the
\n underwriters, if any, such letters to be in customary form
\n and covering matters of the type customarily covered in “cold
\n comfort” letters by underwriters in connection with
\n comparable underwritten offerings;<\/p>\n
(4) if requested, provide the indemnification in
\n accordance with the provisions and procedures of Section 9
\n hereof to all parties to be indemnified pursuant to said
\n Section; and<\/p>\n
(5) deliver such documents and certificates as may be
\n reason ably requested by the Holders of a majority of the
\n Registrable Securities being sold and the underwriters, if
\n any, to evidence compliance with clause (f) above and with
\n any customary conditions contained in the underwriting
\n agreement or other agreement entered into by the Company.<\/p>\n
The matters set forth in this Section 7(i) shall be effected at each
\n closing under any underwriting or similar agreement as and to the
\n extent required thereunder.<\/p>\n
(j) cooperate with the Holders of Registrable Securities
\ncovered by such Registration Statement and the underwriter or underwriters, if
\nany, to facilitate the timely preparation and delivery of certificates (not
\nbearing any restrictive legends) representing the securities to be sold under
\nsuch Registration Statement, and enable such securities to be in such
\ndenominations and registered in such names as the underwriter or underwriters,
\nif any, or such Holders may request, or take other appropriate action if the
\nRegistrable Securities are to be uncertificated;<\/p>\n
16
\n 144<\/p>\n
(k) if requested by the underwriter or underwriters or a
\nHolder of Registrable Securities being sold in connection with an underwritten
\noffering, promptly incorporate in a Prospectus supplement or post-effective
\namendment such information as the underwriters and the Holders of the
\nRegistrable Securities being sold agree should be included therein relating to
\nthe plan of distribution with respect to such Registrable Securities, including,
\nwithout limitation, information with respect to the amount of Registrable
\nSecurities being sold to such underwriters, the purchase price being paid
\ntherefor by such underwriters and with respect to any other terms of the
\nunderwritten offering of the Registrable Securities to be sold in such offering
\nand make all required filings of such Prospectus supplement or post-effective
\namendment promptly upon being notified of the matters of be incorporated in such
\nProspectus supplement or post-effective amendment;<\/p>\n
(l) in the event of any Underwritten Offering,
\nparticipate, and have senior management available to participate, in any
\n“roadshow” marketing efforts reasonably requested by the underwriters; and<\/p>\n
(m) make available for inspection by any Holder of
\nRegistrable Securities included in such Registration Statement, any underwriter
\nparticipating in any disposition pursuant to such Registration Statement, and
\nany attorney, accountant or other agent retained by any such Holder or under
\nwriter in connection with such disposition, such financial and other records and
\nother information, pertinent corporate documents and properties of any of the
\nCompany and its subsidiaries and affiliates, as shall be reasonably necessary to
\nenable them to exercise their due diligence responsibility.<\/p>\n
The Company may require each Holder of Registrable Securities
\nas to which any registration is being effected to furnish the Company with such
\ninformation regarding such Holder and pertinent to the disclosure requirements
\nrelating to the registration and the distribution of such securities as the
\nCompany may from time to tine reasonably request.<\/p>\n
Each Holder of Registrable Securities agrees that, upon
\nreceipt of any notice (the “Suspension Notice”) from the Company of the
\nhappening of any event of the kind described in Section 7(e), such Holder will
\nforthwith discontinue disposition of Registrable Securities pursuant to the
\nProspectus or Registration Statement covering such Registrable Securities until
\nsuch Holder’s receipt of the copies of the supplemented or amended Prospectus
\ncontemplated by Section 7(e), and, if so<\/p>\n
17
\n 145
\ndirected by the Company, such Holder will use its reasonable best efforts to
\ndeliver to the Company (at the Company’s expense) all copies, other than
\npermanent file copies then in such Holder’s possession, of the Prospectus
\ncovering such Registrable Securities current at the time of receipt of such
\nnotice. In the event the Company shall give any such notice, the period of time
\nduring which the Registration Statement is required to be Continuously Effective
\npursuant to Section 3 hereof shall be extended by the number of days during the
\nperiod (the “Suspension Period”) from the date of the giving of such Suspension
\nNotice and through the date when the Holders of Registrable Securities covered
\nby such Registration Statement shall have received the copies of the
\nsupplemented or amended Prospectus contemplated by Section 7(e).<\/p>\n
8. Registration Expenses. The Company will pay all
\nRegistration Expenses in connection with all registrations of Registrable
\nSecurities, except to the extent such Registration Expenses constitute
\nSeparation Expenses, and the Holders shall pay all underwriting discounts and
\ncommissions and transfer taxes, if any, relating to the sale or disposition of
\nsuch Holders’ Registrable Securities pursuant to a Registration Statement. To
\nthe extent Registration Expenses constitute Separation Expenses, they will be
\nthe responsibility of Du Pont.<\/p>\n
9. Indemnification; Contribution. (a) Indemnification by
\nthe Company. The Company agrees to indemnify each Holder of Registrable
\nSecurities, its officers and directors and each Person who controls such Holder
\n(within the meaning of the Securities Act), and any agent and investment or
\nfinancial adviser thereof against all losses, claims, damages, liabilities and
\nexpenses (including reasonable attorneys’ fees and expenses of investigation)
\nincurred by such party pursuant to any actual or threatened action, suit,
\nproceeding or investigation arising out of or based upon (i) any untrue or
\nalleged untrue statement of material fact contained in a Registration
\nStatement, any Prospectus or preliminary Prospectus, or any amendment or
\nsupplement to any of the foregoing or (ii) any omission or alleged omission to
\nstate therein a material fact required to be stated therein or necessary to
\nmake the statements therein (in the case of a Prospectus or a preliminary
\nProspectus, in light of the circumstances under which they were made) not
\nmisleading, except in each case insofar as the same arise out of or are based
\nupon any such untrue statement or omission made in reliance on and in
\nconformity with information furnished in writing to the Company by any
\nindemnified party or its counsel expressly for use therein. In connection with
\nan Underwritten Offering, the Company will indemnify the underwriters thereof,
\ntheir officers and directors and each Person who controls such underwriters
\n(within the meaning of the Securities Act) to the same extent as provided above
\nwith respect to the indemnification of the Holders of Registrable<\/p>\n
18
\n 146<\/p>\n
Securities (provided that as to each underwriter the exception to such
\nindemnification obligation shall instead be for information with respect to
\nsuch underwriter furnished in writing by such underwriter or its counsel).
\nNotwithstanding the foregoing provisions of this Section 9(a), in the case of
\nan offering that is not an Underwritten Offering, the Company will not be
\nliable to any Holder of Registrable Securities under the indemnity agreement in
\nthis Section 9(a) for any such loss, claim, damage, liability (or action or
\nproceeding in respect thereof) or expense that arises out of such Holder’s
\nfailure to send or give a copy of the final Prospectus (as it may then be
\namended or supplemented) to the Person asserting an untrue statement or alleged
\nuntrue statement or omission or alleged omission at or prior to the written
\nconfirmation of the sale of the Registrable Securities to such Person if such
\nstatement or omission was corrected in such final Prospectus (as it may then be
\namended or supplemented) and the Company has previously furnished copies
\nthereof in accordance with this Agreement.<\/p>\n
(b) Indemnification by Holders of Registrable Securities.
\nIn connection with a Registration Statement, each Holder will furnish to the
\nCompany in writing such information, including with respect to the name,
\naddress and the amount of Registrable Securities held by such Holder, as the
\nCompany reasonably requests for use in such Registration Statement or the
\nrelated Prospectus and agrees to indemnify and hold harmless (in the same
\nmanner and to the same extent as set forth in Section 9(a)) the Company, all
\nother prospective Holders or any underwriter, as the case may be, and any of
\ntheir respective affiliates, directors, officers and controlling Persons
\n(within the meaning of the Securities Act) against any losses, claims, damages,
\nliabilities and expenses resulting from any untrue or alleged untrue statement
\nof a material fact or any omission or alleged omission of a material fact
\nrequired to be stated in such Registration Statement or Prospectus or any
\namendment or supplement to either of them or necessary to make the statements
\ntherein (in the case of a Prospectus, in the light of the circumstances then
\nexisting) not misleading, but only to the extent that any such untrue statement
\nor omission is made in reliance on and in conformity with information with
\nrespect to such Holder furnished in writing to the Company by such Holder or
\nits counsel specifically for inclusion therein.<\/p>\n
(c) Conduct of Indemnification Proceedings. Any Person
\nentitled to indemnification hereunder agrees to give prompt written notice to
\nthe indemnifying party after the receipt by such indemnified party of any
\nwritten notice of the commencement of any action, suit, proceeding or
\ninvestigation or threat thereof made in writing for which such indemnified
\nparty may claim indemnification or<\/p>\n
19
\n 147
\ncontribution pursuant to this Agreement (provided that failure to give such
\nnotification shall not affect the obligations of the indemnifying person
\npursuant to this Section 9 except to the extent the indemnifying party shall
\nhave been actually prejudiced as a result of such failure). In case any such
\naction shall be brought against any indemnified party and it shall notify the
\nindemnifying party of the commencement thereof, the indemnifying party shall be
\nentitled to participate therein and, to the extent that it shall wish, jointly
\nwith any other indemnifying party similarly notified, to assume the defense
\nthereof, with counsel reasonably satisfactory to the indemnified parties and
\nafter notice from the indemnifying party to such indemnified party of its
\nelection so to assume the defense thereof, the indemnifying party shall not be
\nliable to such indemnified party under these indemnification provisions for any
\nlegal expenses of other counsel or any other expenses, in each case subsequently
\nincurred by such indemnified party, in connection with the defense thereof other
\nthan reasonable costs of investigation, except as provided in the following
\nsentence. Any such indemnified party shall have the right to employ separate
\ncounsel in any such action, claim or proceeding and to participate in the
\ndefense thereof, but the fees and expenses of such counsel shall be the expenses
\nof such indemnified party unless (i) the indemnifying party has agreed to pay
\nsuch fees and expenses or (ii) the indemnifying party shall have failed to
\npromptly assume the defense of such action, claim or proceeding or (iii) the
\nnamed parties to any such action, claim or proceeding (including any impleaded
\nparties) include both such indemnified party and the indemnifying party, and
\nsuch indemnified party shall have been advised by counsel that there may be one
\nor more legal defenses available to it which are different from or in addition
\nto those available to the indemnifying party and that the assertion of such
\ndefenses could, in the good faith judgment of the indemnified party, create a
\nconflict of interest such that counsel employed by the indemnifying party could
\nnot faithfully represent the indemnified party (in case of clauses (ii) and
\n(iii) , if such indemnified party notifies the indemnifying party in writing
\nthat it elects to employ separate counsel at the expense of the indemnifying
\nparty (which counsel shall be reasonably satisfactory to the indemnifying
\nparty), the indemnifying party shall not have the right to assume the defense of
\nsuch action, claim or proceeding on behalf of such indemnified party; it being
\nunderstood, however, that the indemnifying party shall not, in connection with
\nany one such action, claim or proceeding or separate but substantially similar
\nor related actions, claims or proceedings in the same jurisdiction arising out
\nof the same general allegations or circumstances, be liable for the reasonable
\nfees and expenses of more than one separate firm of attorneys (together with
\nappropriate local counsel) at any time for all such indemnified parties, unless
\nin the good faith judgment of such indemnified party a conflict of interest may
\nexist between such indemnified party<\/p>\n
20
\n 148<\/p>\n
and any other of such indemnified parties with respect to such action, claim or
\nproceeding, in which event the indemnifying party shall be obligated to pay the
\nfees and expenses of such additional counsel or counsels) . The indemnifying
\nparty will not be subject to any liability for any settlement made without its
\nconsent (which consent will not be unreasonably withheld).<\/p>\n
(d) Contribution. To the extent the indemnification from
\nthe indemnifying party provided for in this Section 9 is unavailable to an
\nindemnified party hereunder in respect of any losses, claims, damages,
\nliabilities or expenses referred to therein, then the indemnifying party, in
\nlieu of indemnifying such indemnified party, shall contribute to the amount
\npaid or payable by such indemnified party as a result of such losses, claims,
\ndamages, liabilities and expenses in such proportion as is appropriate to
\nreflect the relative fault of the indemnifying party and indemnified party in
\nconnection with the actions which resulted in such losses, claims, damages,
\nliabilities and expenses, as well as any other relevant equitable
\nconsiderations. The relative fault of such indemnifying party and indemnified
\nparty shall be determined by reference to, among other things, whether any
\naction in question, including any untrue or alleged untrue statement of a
\nmaterial fact or omission or alleged omission to state a material fact, has
\nbeen made by, or relates to information supplied by, such indemnifying party or
\nindemnified party, and the parties’ relative intent, knowledge, access to
\ninformation and opportunity to correct or prevent such action. The amount paid
\nor payable by a party as a result of the losses, claims, damages, liabilities
\nand expenses referred to above shall be deemed to include, subject to the
\nlimitations set forth in Section 9(c), any legal and other fees and expenses
\nreasonably incurred by such indemnified party in connection with any
\ninvestigation or proceeding.<\/p>\n
The parties hereto agree that it would not be just and
\nequitable if contribution pursuant to this Section 9(d) were determined by pro
\nrata allocation or by any other method of allocation which does not take
\naccount of the equitable considerations referred to in the immediately
\npreceding paragraph. Notwithstanding the provisions of this Section 9(d), no
\nunderwriter shall be required to contribute any amount in excess of the amount
\nby which the total price at which the Registrable Securities underwritten by it
\nand distributed to the public were offered to the public exceeds the amount of
\nany damages which such underwriter has otherwise been required to pay by reason
\nof such untrue or alleged untrue statement or omission or alleged omission, and
\nno Holder of Registrable Securities shall be required to contribute any amount
\nin excess of the amount by which the total price at which the Registrable
\nSecurities of such Holder were offered to the public (net of all underwriting<\/p>\n
21
\n 149
\ndiscounts and commissions) exceeds the amount of any damages which such Holder
\nhas otherwise been required to pay by reason of such untrue statement or
\nomission. No Person guilty of fraudulent misrepresentation (within the meaning
\nof Section 11(f) of the Securities Act) shall be entitled to contribution from
\nany Person who was not guilty of such fraudulent misrepresentation.<\/p>\n
To the extent indemnification is available under this Section
\n9, the indemnifying parties shall indemnify each indemnified party to the full
\nextent provided in Section 9(a) or (b), as the case may be, without regard to
\nthe relative fault of said indemnifying parties or indemnified party or any
\nother equitable consideration provided for in this Section 9(d).<\/p>\n
(e) The provisions of this Section 9 shall be applicable
\nin respect of each registration pursuant to this Agreement, shall be in
\naddition to any liability which any party may have to any other party and shall
\nsurvive any termination of this Agreement.<\/p>\n
10. Rule 144. For a period of two years following the
\nClosing Date or, if at the end of such two year period, a Holder is an
\naffiliate of the Company, until such time as no Holder is an affiliate of the
\nCompany, the Company covenants that it will file the reports required to be
\nfiled by it under the Securities Act and the Ex change Act (or, if the Company
\nis not required to file such reports, it will, upon the request of any Holder
\nof Registrable Securities, make publicly available other information so long as
\nnecessary to satisfy the requirements of Rule 144 under the Securities Act
\nrelating to the availability of public information), all to the extent required
\nfrom time to time to enable such Holder to sell Registrable Securities without
\nregistration under the Securities Act within the limitation of the exemptions
\nprovided by (a) Rule 144 under the Securities Act, as such Rule may be amended
\nfrom time to time, or (b) any similar rule or regulation hereafter adopted by
\nthe SEC. Upon the request of any Holder of Registrable Securities, the Company
\nwill deliver to such Holder a written statement as to whether it has complied
\nwith such requirements.<\/p>\n
11. Miscellaneous.<\/p>\n
(a) Remedies. Each Holder of Registrable Securities in
\naddition to being entitled to exercise all rights granted by law, including
\nrecovery of damages, will be entitled to specific performance of its rights
\nunder this Agreement.<\/p>\n
22
\n 150<\/p>\n
(b) Amendments and Waivers. Except as otherwise provided
\nherein, the provisions of this Agreement may not be amended, modified or
\nsupplemented, and waivers or consents to departures from the provisions hereof
\nmay not be given, unless the Company has obtained the written consent of the
\nHolders of the Registrable Securities.<\/p>\n
(c) Notices. All notices and other communications provided
\nfor or permitted hereunder shall be in writing and shall be deemed to have been
\nduly given if delivered personally or sent by telex or telecopier, registered
\nor certified mail (return receipt requested), postage prepaid, or courier
\nguaranteeing next day delivery to the parties at the following addresses (or at
\nsuch other address for any party an shall be specified by like notice, provided
\nthat notices of a change of address shall be effective only upon receipt
\nthereof). Notices delivered personally shall be effective upon receipt, notices
\nsent by mail shall be effective three days after mailing, notices sent by telex
\nshall be effective when answered back, notices sent by telecopier shall be
\neffective when receipt is acknowledged, and notices sent by courier
\nguaranteeing next day delivery shall be effective on the next business day
\nafter timely delivery to the courier:<\/p>\n
23
\n 151<\/p>\n
(1) if Du Pont, to it at:<\/p>\n
E.I. du Pont de Nemours & Company
\n 1007 Market Street
\n Wilmington, DE 19898
\n Attn. Roger Arrington, Esq.
\n Tel.: 302-774-8571
\n Fax: 302-773-5952<\/p>\n
(2) if the Company, to it at:<\/p>\n
600 North Dairy Ashford
\n Houston, TX 77079
\n Attn. R.A. Harrington, Esq.
\n Tel.: 281-293-1000
\n Fax: 281-293-1440<\/p>\n
(d) Successors and Assigns. This Agreement shall inure to
\nthe benefit of and be binding upon the successors of each of the parties and
\ntransferees of Registrable Securities who come within the term Holder.<\/p>\n
(e) Counterparts. This Agreement may be executed in any
\nnumber of counterparts and by the parties hereto in separate counterparts, each
\nof which when so executed shall be deemed to be an original and all of which
\ntaken together shall constitute one and the same agreement.<\/p>\n
(f) Headings. The headings in this Agreement are for
\nconvenience of reference only and shall not limit or otherwise affect the
\nmeaning hereof.<\/p>\n
(g) Governing Law. This Agreement shall be governed by and
\nconstrued in accordance with the laws of the State of New York applicable to
\ncontracts made and to be performed wholly within that State.<\/p>\n
(h) Severability. In the event that any one or more of the
\nprovisions contained herein, or the application thereof in any circumstances,
\nis held invalid, illegal or unenforceable in any respect for any reason, the
\nvalidity, legality and enforceability of any such provision in every other
\nrespect and of the remaining provisions contained herein shall not be in any
\nway impaired thereby, it being intended that all remaining provisions contained
\nherein shall not be in any way<\/p>\n
24
\n 152<\/p>\n
impaired thereby, it being intended that all of the rights and privileges of
\nthe Stock holders shall be enforceable to the fullest extent permitted by law.<\/p>\n
(i) Entire Agreement. This Agreement is intended by the
\nparties as a final expression and a complete and exclusive statement of the
\nagreement and understanding of the parties hereto in respect of the subject
\nmatter hereof. There are no restrictions, promises, warranties or undertakings
\nwith respect to the subject matter hereof, other than those set forth or
\nreferred to herein and therein. This Agreement supersedes all prior agreements
\nand understandings between the parties with respect to such subject matter.<\/p>\n
25
\n 153<\/p>\n
IN WITNESS WHEREOF, the parties have executed this Agreement
\nas of the date first written above.<\/p>\n
CONOCO INC.<\/p>\n
by:\/s\/ R.A. Harrington
\n ———————
\n Name: R.A. Harrington
\n Title: Sr. Vice President
\n and General Counsel <\/p>\n
E.I. DU PONT DE NEMOURS AND COMPANY<\/p>\n
by:\/s\/ S.M. Stalnecker
\n ——————–
\n Name: S.M. Stalnecker
\n Title: Vice President
\n and Treasurer<\/p>\n
26<\/p>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[7185],"corporate_contracts_industries":[9412],"corporate_contracts_types":[9622,9628],"class_list":["post-43557","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-conoco-inc","corporate_contracts_industries-energy__refining","corporate_contracts_types-planning","corporate_contracts_types-planning__separation"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/43557","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=43557"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=43557"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=43557"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=43557"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}