[ARTICLE] 5
[MULTIPLIER] 1
CONFIDENTIAL TREATMENT REQUESTED
[*] Denotes information for which confidential
treatment has been requested. Confidential portions
omitted have been filed separately with the Commission.
JOINT VENTURE FORMATION AGREEMENT (this "Agreement"), dated as of
October 23, 1995, by and among AT&T Corp., a New York Corporation ("AT&T"), ATOR
Corp., a New York corporation (the "AT&T Partner"), Cirrus Logic, Inc., a
California corporation ("Cirrus"), and Ciror, Inc., a California corporation
(the "Cirrus Partner").
WHEREAS, the parties hereto desire to enter into a cooperative
arrangement with respect to the expansion and operation of certain wafer
fabrication facilities for the purpose of processing silicon wafers; and
WHEREAS, the parties hereto consider it mutually beneficial to
establish a general partnership (the "Partnership") and the AT&T Partner and the
Cirrus Partner are entering into the GP Agreement (as defined in Section 1.01
hereof) concurrently herewith.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants, representations, warranties and agreements hereinafter set forth, and
intending to be legally bound hereby, the parties hereto agree, subject to the
conditions contained herein, as follows:
ARTICLE I
DEFINITIONS
1.01. Definitions. For the purpose hereof, the following terms will
have the following meanings:
"AAA" will have the meaning set forth in Section 13.02 hereof.
"Affiliate" means any Person, directly or indirectly controlled by,
controlling or under common control with (as hereinafter defined) another Person
(as hereinafter defined); "controlled by, controlling or under common control
with" means the power to direct the management and policies of a Person, whether
through the ownership of voting securities, by agreement or otherwise.
"Annual Plan" means the initial annual plan of the Partnership
substantially in the form attached hereto as Appendix I, and as amended in
accordance with Article VI of the GP Agreement (as hereinafter defined).
"AT&T" will have the meaning set forth in the preamble hereto.
"AT&T Assets" means the capital equipment and other assets which the
AT&T Partner will cause to be leased, transferred, sold or otherwise delivered
to the Partnership.
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"AT&T Employee Services and Staffing Agreement" means the AT&T
Employee Services and Staffing Agreement between the AT&T Partner and the
Partnership substantially in the form attached hereto as Exhibit A.
"AT&T Financial Statements" will have the meaning set forth in
Section 8.04 hereof.
"AT&T Group" will have the meaning set forth in Section 11.01
hereof.
"AT&T Partner" will have the meaning set forth in the preamble
hereto.
"AT&T Employee" means the Loaned Employees (as defined in the
AT&T Employee Services and Staffing Agreement) and the Production Employees (as
defined in the AT&T Employee Services and Staffing Agreement).
"Authorized Representative" will have the meaning set forth in
Section 4.01 hereof.
"Board of Governors" means the Board of Governors of the
Partnership as set forth in the GP Agreement.
"Bonus Plan" will have the meaning set forth in Section 4.06
hereof.
"Business" means the business of the Partnership in the
operation of certain wafer fabrication facilities in accordance with the terms
of the Annual Plan, for the purpose of processing silicon wafers and such other
activities as may be desirable and proper in the furtherance thereof.
"Buy-Out Options" will have the meaning set forth in Section
10.03 hereof.
"Cirrus" will have the meaning set forth in the preamble
hereto.
"Cirrus Assets" means the capital equipment and other assets
which the Cirrus Partner will cause to be leased, delivered, sold or otherwise
transferred to the Partnership.
"Cirrus Employee Services and Staffing Agreement" means the
Cirrus Employee Services and Staffing Agreement which may be entered into
between the Cirrus Partner and the Partnership upon substantially similar terms
and conditions as the AT&T Employee Services and Staffing Agreement.
"Cirrus Financial Statements" will have the meaning set forth
in Section 9.04 hereof.
"Cirrus Group" will have the meaning set forth in Section
11.01 hereof.
"Cirrus Partner" will have the meaning set forth in the
preamble hereto.
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"Cirrus Employee" means an employee of Cirrus or an Affiliate
of Cirrus loaned to the Partnership pursuant to the Cirrus Employee Services and
Staffing Agreement.
"Claim" or "Claims" will have the meaning set forth in Section
11.01 hereof.
"Closing" means the closing of the transactions contemplated
hereby and referred to in Section 7.01 hereof.
"Closing Date" will have the meaning set forth in Section 7.01
hereof.
"Committee" will have the meaning set forth in Section 4.01
hereof.
"Confidential Information" will have the meaning set forth in
Section 6.01 hereof.
"Deadlock" will have the meaning set forth in Section 13.01
hereof.
"Dispute" will have the meaning set forth in Section 13.01
hereof.
"Environmental Consultants" will have the meaning set forth in
Section 4.09 hereof.
"Environmental Report" will have the meaning set forth in
Section 4.09 hereof.
"Environmental Policy" will have the meaning set forth in the
Lease.
"First Representatives" will have the meaning set forth in
Section 13.02.
"GAAP" means generally accepted accounting principles
consistently applied.
"GP Agreement" means the General Partnership Agreement between
the AT&T Partner and the Cirrus Partner substantially in the form attached
hereto as Exhibit B.
"Hazardous Materials" will have the meaning set forth in the
Lease (as hereinafter defined).
"Hazardous Materials Laws" will have the meaning set forth in
the Lease.
"Implementation Plan" will have the meaning set forth in
Section 4.01 hereof.
"Independent Accountant" means the firm of independent
certified public accountants retained by AT&T from time to time which will act
as auditor for the Partnership as provided in Section 12.01.
"Intellectual Property" will have the meaning set forth in
Section 4.03 hereof.
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"LCCP Rules" will have the meaning set forth in Section 13.03.
"Land" will have the meaning set forth in the Lease.
"Landlord" will have the meaning set forth in the Lease.
"Lease" means the Lease between AT&T and the Partnership
substantially in the form attached hereto as Exhibit C.
"Employees" means the AT&T Employees and the Cirrus Employees.
"Material Agreements" means the following related agreements:
(i) the GP Agreement;
(ii) the AT&T Employee Services and Staffing
Agreement;
(iii) if entered into, the Cirrus Employee
Services and Staffing Agreement;
(iv) the Lease;
(v) the Patent License Agreement (as hereinafter
defined);
(vi) the Technical Transfer Agreement (as
hereinafter defined); and
(vii) the Wafer Supply Agreement (as hereinafter
defined).
"OR1" will have the meaning set forth in Section 4.01 hereof.
"OR2" will have the meaning set forth in Section 4.01 hereof.
"Owner" will have the meaning set forth in Section 6.01 hereof
"Partnership" will have the meaning set forth in the preamble
hereto.
"Patent License Agreement" means the Patent License Agreement
between the AT&T Partner and the Partnership which will be consistent with the
terms of the Term Sheet set forth at Exhibit D hereto.
"Person" means any individual, partnership, association, joint
stock company, joint venture, corporation, trust, unincorporated organization or
government, or agency or political subdivision thereof.
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"Pre-Existing Contamination" will mean all past or present
actions, activities, circumstances, conditions, events or incidents in, at, on
or under the Land or the Premises, including, without limitation, the release,
emission, discharge or disposal of any Hazardous Materials, in each such case as
specifically identified in the Environmental Report.
"Preliminary Implementation Plan" will have the meaning set
forth in Section 2.01 hereof.
"Premises" will have the meaning set forth in the Lease.
"Recipient" will have the meaning set forth in Section 6.01
hereof.
"Restructuring" will mean the strategic restructuring of AT&T
announced September 20, 1995.
"Second Representatives" will have the meaning set forth in
Section 13.02.
"Structural Components" will have the meaning set forth in the
Lease.
"[*]" will have the meaning set forth in Section 10.03 hereof.
"Technical Transfer Agreement" means the Technical Transfer
Agreement between the AT&T Partner and the Partnership substantially in the form
attached hereto as Exhibit E.
"Wafer Supply Agreement" means the Wafer Supply Agreement by
and among the AT&T Partner, the Cirrus Partner and the Partnership substantially
in the form attached hereto as Exhibit F.
ARTICLE II
FORMATION OF THE JOINT VENTURE
2.01. Formation of the Partnership. Following the execution and
delivery of this Agreement and in no event less than sixty (60) days prior to
the Closing Date, the AT&T Partner and the Cirrus Partner will cause the
formation of the Partnership as a general partnership under the laws of the
State of New York in accordance with the terms of the written plan set forth as
Appendix II hereto (the "Preliminary Implementation Plan") for the orderly
start-up of the Partnership's business and pursuant to this Agreement and the GP
Agreement.
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2.02. Expenses. Each of the parties hereto will bear the fees and
expenses of its respective counsel, accountants and experts and all other costs
and expenses incurred by it incident to the negotiation, preparation, execution
and delivery of this Agreement and the Material Agreements; provided, however,
expenses relating to the formation of the Partnership, including but not limited
to taxes, fees, registration charges, notarial expenses, fees and expenses
relating to required governmental or regulatory approvals for the formation of
the Partnership will be paid by the Partnership.
ARTICLE III
SCOPE AND OBJECTIVES; ANNUAL PLAN
3.01. Purpose. (a) The purpose of the Partnership will be to operate
the Business.
(b) The parties hereto expressly acknowledge that the
Partnership is being formed solely for the limited purpose set forth in Section
3.01(a) above and agree that none of the parties hereto has any obligation to
the others or to the Partnership to bring business opportunities to the
Partnership or to any of the other parties hereto and are each free to take
advantage of such opportunities on their own or with third parties; provided,
however, that none of the parties hereto will take any action or fail to take
any action which would reasonably cause a material adverse effect to the
Business or the Partnership. The parties hereto further recognize that each of
them is incurring a portion of the risk of, and expects to realize a portion of
the return from, the Partnership through this Agreement and one or more of the
Material Agreements, and the parties hereto expressly acknowledge and agree that
this Agreement and the Material Agreements are fair and reasonable to the
Partnership and to each of the parties hereto in light of the totality of the
facts and circumstances.
3.02. Annual Plan. (a) The Annual Plan sets forth the objectives of the
Partnership for the period beginning on July 1, 1996 and ending on June 30,
2006. The Board of Governors will review and update the Annual Plan [*]. On or
before [*] of each fiscal year of the Partnership commencing [*], the Board of
Governors will, in accordance with the terms of Article VI of the GP Agreement,
ratify or amend the information set forth in the Annual Plan for [*] and include
in the amended Annual Plan information and objectives for the fiscal year next
succeeding the last year then covered by the Annual Plan. In the event that the
Board of Governors are unable to agree on such amendment in accordance with the
terms of Article VI of the GP Agreement, the information and objectives for the
fiscal year next succeeding the last year then covered by the Annual Plan will
be those of the last year then covered by the Annual Plan.
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(b) Each of the AT&T Partner and the Cirrus Partner
acknowledges that the Annual Plan will represent as of the Closing Date their
collective best views as to the matters described therein. Each of the AT&T
Partner and the Cirrus Partner agrees, and agrees to cause its Affiliates, to
cooperate with any of the other parties hereto (and their Affiliates) and with
the Partnership and to use its reasonable best efforts to promote the success of
the Partnership in attaining the objectives set forth in the Annual Plan. The
parties hereto covenant and agree not to take any action or fail to take any
action which would reasonably cause a material adverse effect to the Business or
the Partnership.
3.03. Concurrence. Each of the parties hereto agrees that it will vote
and otherwise act and in all respects use its best efforts and take all such
steps as may be within its power so as to comply, to cause its Affiliates to
comply, and to cause the Partnership to comply with and act in a manner in order
to fully effect the transactions contemplated hereby.
ARTICLE IV
OPERATION OF THE BUSINESS
4.01. Implementation Committee. As of the date hereof, each of AT&T and
Cirrus have designated three (3) individuals to represent them as members of an
Implementation Committee (the "Committee"), the purpose of which will be to
finalize a mutually acceptable written plan (the "Implementation Plan") for the
orderly start-up of the Partnership's business, which will be based
substantially upon the Preliminary Implementation Plan. Each of the AT&T Partner
and the Cirrus Partner will designate a representative (an "Authorized
Representative"), who will (i) be acceptable to the other parties hereto, (ii)
not be a member of the Committee, (iii) be responsible for causing the
transactions contemplated by the Implementation Plan to be effected on behalf of
AT&T or Cirrus, as the case may be, and (iv) have been delegated authority to
enter into binding commitments on its behalf with respect to matters covered by
the Implementation Plan. Each party hereto agrees to cooperate and to cause its
Affiliates to cooperate with the Committee in support of its effort to develop
the Implementation Plan in a manner which is consistent with positioning the
Partnership to attain the objectives of the Annual Plan. The Implementation Plan
will be based substantially on the Preliminary Implementation Plan and will
include: (a) a timetable for AT&T's construction of the infrastructure and clean
room required to house and support an eight inch silicon wafer fabrication
facility ("OR2") with capacity of approximately [*] 0.5u wafer starts per month
at an approximate cost of $[*], specifying the respective rights of the AT&T
Partner and the Cirrus Partner to inspect, modify (or cause to be modified) and
approve such construction; (b) details of the capital equipment and other assets
located at AT&T's current facility at Orlando ("OR1") which the AT&T Partner
will cause to be provided to the Partnership; (c) (i) a detailed summary of the
financing plan for the AT&T
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Assets, (ii) a detailed summary of the financing plan for the Cirrus Assets and
(iii) details of the provision to the Partnership of approximately $[*] of AT&T
Assets and approximately $280,000,000 of Cirrus Assets; and (d) details of the
technology, technology development and other intellectual property which the
AT&T Partner will cause to be transferred or licensed, as the case may be, to
the Partnership pursuant to the Technical Transfer Agreement and the Patent
License Agreement. The Preliminary Implementation Plan will be effective from
the date hereof to and including the date of execution and delivery of the
Implementation Plan. The Implementation Plan will be effective from the date of
the execution and delivery thereof to and including the Closing Date. Not later
than [*] days after the execution and delivery of this Agreement, the AT&T
Partner and the Cirrus Partner will execute the Implementation Plan. No member
of the Implementation Committee will have the authority or power to bind any
party hereto unless separately agreed to in writing by the Authorized
Representative of such party. The members of the Implementation Committee (as
provided in the immediately preceding sentence) and the Authorized
Representatives will have authority to act on behalf of AT&T or Cirrus, as the
case may be, until the later of (a) formation of the Partnership and election of
the Board of Governors or (b) the Closing Date.
4.02. Financing of Capital Equipment; Delivery of Capital Equipment.
Cirrus and its Affiliates acknowledge and agree that the acquisition of the
Cirrus Assets will be financed through operating leases, in each such case
guaranteed by Cirrus and the Cirrus Partner without recourse to AT&T or the AT&T
Partner and with such assurances or covenants as to financial security as are
reasonably acceptable to AT&T. AT&T and its Affiliates acknowledge and agree
that the acquisition of the AT&T Assets may be financed through operating leases
in AT&T's sole discretion, in each such case guaranteed by AT&T and the AT&T
Partner without recourse to Cirrus or the Cirrus Partner and with such
assurances or covenants as to financial security as are reasonably acceptable to
Cirrus. Each of the AT&T Partner and the Cirrus Partner covenant and agree (a)
to cause the AT&T Assets and the Cirrus Assets, respectively, to be leased,
delivered, sold or otherwise transferred to the Partnership in accordance with
the terms of the Implementation Plan and (b) to cooperate with each other and
their respective Affiliates, and to cause their respective advisors to cooperate
with each other, in structuring such lease, delivery, sale or other transfer to
minimize any adverse accounting and tax implications on any of AT&T, Cirrus, and
their respective Affiliates which might arise as a result of such lease,
delivery, sale or other transfer.
4.03. Intellectual Property. The AT&T Partner will cause AT&T to
license or transfer, as the case may be, certain technology, technology
development and other intellectual property (the "Intellectual Property") to the
Partnership pursuant to, and for the consideration specified in, the Technical
Transfer Agreement and the Patent License Agreement. [*]
4.04. Operation of Plant and Business. On and after the Closing
Date, the Partnership will conduct the Business in accordance with this Section
4.04.
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(a) Location. The Partnership will be located in Orlando,
Florida. On the Closing Date, the AT&T Partner will cause AT&T to, and the
Partnership will, execute and deliver the Lease.
(b) Operation. (i) The Partnership will operate OR1 solely for
the benefit and for the account of the AT&T Partner. The AT&T Partner will
purchase the output of OR1 upon the terms and subject to the conditions of the
Wafer Supply Agreement. The parties hereto acknowledge and agree that in no
event will the operation of OR1 be conducted in such a manner as to directly
result in a material adverse effect to the capacity, cost structure or
performance of OR2.
(ii) The Partnership will operate OR2 for the mutual
benefit of the AT&T Partner and the Cirrus Partner. The AT&T Partner and the
Cirrus Partner will purchase the output of OR2 upon the terms and subject to the
conditions of the Wafer Supply Agreement.
(iii) Operation of the Partnership will be in
accordance with the terms of the Annual Plan. The Partnership will cause OR1 and
OR2 to process wafers at the direction of the AT&T Partner and the Cirrus
Partner with respect to their respective share of OR1 and OR2 capa city,
consistent with the Annual Plan and pursuant to the terms of the Wafer Supply
Agreement, as long as such operations do not adversely affect the capacity, cost
structure or performance of the manufacturing capabilities of OR2.
(c) Costs.
(i) OR1. [*] costs, charges, capital equipment and
working capital directly and indirectly associated with OR1 will be paid by [*]
pursuant to the cost allocations appearing in the Annual Plan. Unless otherwise
agreed to by the parties hereto, [*] costs, charges, capital equipment and
working capital directly associated with a periodic wind-down or one-time
shutdown of OR1 will be paid by [*].
(ii) (a) OR2 - Working Capital. The working capital
required with respect to OR2 will be provided [*] by [*].
(b) OR2 - Technology. [*] costs with respect
to the development of technology in accordance with the "technology roadmap"
specified in the Annual Plan will be paid by [*]; provided, however, that the
cost of any variant to such technology will be paid by [*]. All such wafers
required for the development or variation of technology will be provided from
the portion of OR2 output to which [*] is entitled under the Wafer Supply
Agreement.
(d) Profits. All profits and excess cash flow attributable to
OR1 will be distributed to the AT&T Partner in accordance with the terms of the
GP Agreement. All profits and excess cash
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flow attributable to OR2 will be distributed to the AT&T Partner and the Cirrus
Partner in accordance with the terms of the GP Agreement.
(e) Borrowings. The Partnership may enter into such credit
facilities as are specified in the Annual Plan.
4.05. Procurement of Administrative and Support Services. The AT&T
Partner and the Cirrus Partner acknowledge and agree that either of the AT&T
Partner or the Cirrus Partner may provide such administrative or support
services as the Partnership may reasonably request, in which event such services
will be provided at such costs as the AT&T Partner and the Cirrus Partner may
mutually agree.
4.06. Personnel. (a) The initial organization chart of the Partnership
and the headcount forecast, by category of employee and position title, are set
forth in the Annual Plan. AT&T will make available to the Partnership, upon the
terms and subject to the conditions set forth in the AT&T Employee Services and
Staffing Agreement, the AT&T Employees. Cirrus may make available to the
Partnership, upon the terms and subject to the conditions set forth in the
Cirrus Employee Services and Staffing Agreement, the Cirrus Employees. The
parties hereto covenant and agree that the Employees will be qualified to
perform services in all of the positions shown in the headcount forecast of the
Partnership and any other positions which the Board of Governors will, from time
to time, designate to be held by Employees.
(b) AT&T will review with Cirrus, and obtain Cirrus' prior
consent (such consent not to be unreasonably withheld) to, personnel changes,
reassignments or relocation of the persons occupying the ten positions which
will be identified by Cirrus at or prior to the Closing in accordance with the
principles set forth at Appendix III hereto. Other than with respect to the
persons referenced in the immediately preceding sentence, AT&T agrees to limit
reassignment or relocation of the AT&T Employees in accordance with the
principles set forth at Appendix III hereto.
(c) The Employees will be compensated as provided in the AT&T
Employee Services and Staffing Agreement and the Cirrus Employee Services and
Staffing Agreement, as the case may be.
(d) The Partnership will adopt and implement a bonus plan (the
"Bonus Plan"), the material terms of which are set forth at Appendix IV hereto.
The Bonus Plan may be amended or modified in accordance with the terms of
Article VI of the GP Agreement. The Bonus Plan has the goal of encouraging
Employees to cause the manufacture of products by the Partnership at a cost and
defect rate and in a time frame in each case better than that specified in the
Annual Plan. The Bonus Plan will specify that bonuses are to be calculated based
upon the complete fiscal year operation of the Partnership. [*] As more
specifically set forth in the Bonus Plan, in order to be entitled to such
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bonuses, Employees (i) must have been assigned by AT&T or Cirrus, as the case
may be, to the Partnership, for the minimum time period set forth in the Bonus
Plan and (ii) must be engaged by the Partnership on the date such bonuses are
paid.
(e) Neither party hereto will, during the employment of a
Employee and during the [*] period following termination of any such Employee,
directly or indirectly, hire or attempt to recruit or hire, as an employee,
consultant, agent or representative, such Employee if such Employee was a
Employee of the other party hereto. Notwithstanding the foregoing, an attempt to
recruit or hire by either party hereto will not include advertisements, general
employment searches and internal job posting systems which are not specifically
directed to the Employees of the other party hereto.
4.07. Culture. The parties hereto agree to use their reasonable best
efforts to cause the creation of an "entrepreneurial culture" within the
Partnership.
4.08. Financing. From the date hereof to the Closing Date, each of AT&T
and Cirrus will use its reasonable best efforts to secure such funds or
financing as may be necessary to effect the transactions contemplated hereby.
Each of AT&T or the AT&T Partner, on the one hand, and Cirrus or the Cirrus
Partner, on the other hand, will pay such interest carrying costs as may accrue
with respect to the AT&T Assets or the Cirrus Assets, respectively. No later
than [*] prior to the Closing, each of AT&T and Cirrus will have delivered
evidence to each other of the availability of funds or financing as may be
necessary to effect the transactions contemplated by the Implementation Plan to
occur at or prior to the Closing Date.
4.09. Environmental Matters. As soon as reasonably practicable
following the execution and delivery of this Agreement, AT&T and Cirrus will
select a mutually acceptable nationally recognized environmental consulting firm
(the "Environmental Consultants") to conduct a "Phase II" survey of the Land and
the Premises and to draft and deliver a report with respect thereto (the
"Environmental Report"). The Environmental Report will be delivered no later
than January 1, 1996 or as soon as practicable thereafter to allow for the
results of any required research or laboratory testing. AT&T covenants and
agrees to remediate or otherwise correct, in accordance with the recommendations
of the Environmental Consultants, and in compliance with Hazardous Materials
Laws, all Pre-Existing Contamination that constitutes a violation of Hazardous
Materials Laws. Notwithstanding the foregoing, AT&T covenants and agrees to
comply with all recommendations of the Environmental Consultants to the extent
that such recommendations comply with Hazardous Materials Laws.
4.10. Employee Matters. (a) (i) If the presence of Hazardous Materials
in, on, under or about the Premises is (x) willfully caused by a natural person
employed or retained by AT&T or any Affiliate of AT&T (other than the
Partnership and other than the Landlord; provided, however, that
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this exclusion will not release AT&T from any liability under this Section
4.10(a) (I) as an entity acting other than as the Landlord) or any Agent of AT&T
and such natural person is not acting on the instruction of any natural person
employed or retained by Cirrus or (y) is caused by the instruction of any
natural person employed or retained by AT&T or any Affiliate of AT&T (other than
the Partnership and other than the Landlord; provided, however, that this
exclusion will not release AT&T from any liability under this Section 4.10(a)
(I) as an entity acting other than as the Landlord) or any Agent of AT&T,
regardless of whether such instruction is followed by any natural person
employed or retained by AT&T or any natural person employed or retained by
Cirrus, and such presence of Hazardous Materials results in contamination or
deterioration of air, water or soil resulting in a level of contamination or
deterioration greater than the levels established as acceptable by any
governmental agency having jurisdiction over such contamination or
deterioration, then AT&T will promptly take any and all action necessary to
investigate and remediate such contamination or deterioration if required by
Hazardous Materials Laws or as a condition to the issuance or continuing
effectiveness of any governmental approval which relates to the use of the
Premises or any part thereof.
(ii) If the presence of Hazardous Materials in, on,
under or about the Premises is (x) willfully caused by a natural person employed
or retained by Cirrus or any Affiliate of Cirrus (other than the Partnership) or
any Agent of Cirrus and such natural person is not acting on the instruction of
any natural person employed or retained by AT&T or (y) is caused by the
instruction of any natural person employed or retained by Cirrus or any
Affiliate of Cirrus (other than the Partnership) or any Agent of Cirrus,
regardless of whether such instruction is followed by any natural person
employed or retained by AT&T or any natural person employed or retained by
Cirrus, and such presence of Hazardous Materials results in contamination or
deterioration of air, water or soil resulting in a level of contamination or
deterioration greater than the levels established as acceptable by any
governmental agency having jurisdiction over such contamination or
deterioration, then Cirrus will promptly take any and all action necessary to
investigate and remediate such contamination or deterioration if required by
Hazardous Materials Laws or as a condition to the issuance or continuing
effectiveness of any governmental approval which relates to the use of the
Premises or any part thereof.
(b) (i) AT&T will make or cause to be made all repairs to the
Structural Components, and all repairs with respect to any other damage or
destruction to the Premises, to the extent that any such repairs result from (i)
the willful act or omission of any natural person employed or retained by AT&T
without having been instructed to so act or omit to act by any natural person
employed or retained by Cirrus or (ii) the issuance of any instruction by any
natural person employed or retained by AT&T, regardless of whether such
instruction is followed by any natural person employed or retained by AT&T or
any natural person employed or retained by Cirrus.
(ii) Cirrus will make or cause to be made all repairs
to the Structural Components, and all repairs with respect to any other damage
or destruction to the Premises, to the extent that any such repairs result from
(i) the willful act or omission of any natural person employed or retained by
Cirrus without having been instructed to so act or omit to act by any natural
person employed or retained by AT&T or (ii) the issuance of any instruction by
any natural person employed
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or retained by Cirrus, regardless of whether such instruction is followed by any
natural person employed or retained by AT&T or any natural person employed or
retained by Cirrus.
(iii) Notwithstanding anything to the contrary
contained in Article XI hereof, in the event of an insurable loss, neither of
AT&T or Cirrus, as the case may be, will be liable for repairs in an amount
greater than the Landlord's deductible under applicable insurance policies.
ARTICLE V
MANAGEMENT; RIGHTS AND OBLIGATIONS OF THE PARTIES
5.01. Management; Rights and Obligations of the Parties. The
Partnership will be managed, and the AT&T Partner and the Cirrus Partner will
have the rights and obligations, as set forth in the GP Agreement. The members
of the Board of Governors will be elected in accordance with the terms of the GP
Agreement. The officers of the Partnership will be appointed in accordance with
the terms of the GP Agreement.
ARTICLE VI
CONFIDENTIALITY
6.01. Confidential Information Defined. "Confidential Information"
means all marketing, technical or business information created by the
Partnership or disclosed by a party hereto (the "Owner") to another party
hereto(the "Recipient") which is confidential, proprietary and/or not generally
available to the public. Information provided in tangible form will be clearly
marked "Confidential Information". Any technical information, including but not
limited to circuit layout, design, or software, embedded in any device will be
deemed to be Confidential Information notwith standing the absence of any
marking on such device. Information provided orally will be considered
Confidential Information if it is identified by the Owner as Confidential
Information at the time of oral disclosure and the Owner summarizes such
Confidential Information in a writing provided to the Recipient within 20
(twenty) days following such oral disclosure.
6.02. Treatment of Confidential Information. Unless otherwise
contemplated by this Agreement or the Material Agreements, (a) Confidential
Information provided by the Owner will remain the property of the Owner and (b)
no rights by license or otherwise in any information will be granted solely by
the disclosure of Confidential Information. During the term hereof, and for a
period of three (3) years following the termination hereof, the Recipient will,
and will cause its Affiliates to, keep confidential and will not disclose, and
will cause its Affiliates not to disclose, to third parties the Confidential
Information received from or made available by the Owner. The Recipient will not
use and will cause its Affiliates not to use such Confidential Information for
any purpose other than the performance of its obligations under this Agreement
or any of the Material Agreements to which it is a party. At the conclusion of
such three (3) year period, written Confidential Information will be returned to
the Owner or destroyed as the Owner may elect, and no copies, extracts or other
repro-
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ductions will be retained by the Recipient. All documents, memoranda, notes and
other writings whatsoever prepared by the Recipient which contain Confidential
Information will be returned to the Owner or destroyed at the Owner's request.
6.03. Excluded Information. Notwithstanding the foregoing provisions of
this Article VI, "Confidential Information" will not include, and the Recipient
will have no obligation with respect to, any such information which:
(a) is already known to the Recipient as of the date hereof;
(b) is or becomes publicly known, through publication,
inspection of a product, or otherwise, and through no negligence or other
wrongful act of the Recipient;
(c) is received by the Recipient from a third party without
similar restriction and without breach hereof;
(d) is independently developed by the Recipient; or
(e) is furnished to a third party by the Owner without a
similar restriction on the third party's rights.
6.04. Notice Prior to Disclosure. If the Recipient (or its Affiliate)
is requested or required (by oral questions, interrogatories, requests for
information or documents, subpoena, civil investi gative demand or similar
process) to disclose any Confidential Information, the Recipient will promptly
notify the Owner of such request or requirement so that the Owner may seek an
appropriate protective order or waive compliance with the provisions of this
Section 6.04. If, in the absence of a protective order or the receipt of a
waiver hereunder, the Recipient (or any of its Affiliates) is, in the written
opinion of the Recipient's counsel, compelled to disclose the Confidential
Information or else stand liable for contempt or suffer other censure or
significant penalty, the Recipient (or its Affiliate) may disclose only so much
of the Confidential Information to the party compelling disclosure as is
required by law. The Recipient will exercise (and will cause its Affiliate to
exercise) reasonable efforts to obtain a protective order or other reliable
assurance that confidential treatment will be accorded to Confidential
Information.
6.05. Agreements Confidential. Except as disclosure may be required by
law, the material terms and conditions of this Agreement and the Material
Agreements, and all Exhibits, Schedules, Appendices, attachments and amendments
hereto and thereto will be deemed to be "Confidential Information" and treated
in accordance with the provisions of this Article VI. To the extent that such
disclosure is required by law, the parties hereto will not disclose the terms
and conditions of this Agreement and the Material Agreements, and all Exhibits,
Schedules, Appendices, attachments and amendments hereto and thereto which the
parties hereto deem to be proprietary; provided, however, in no event will such
disclosure fail to satisfy the requirements of law which mandate such
disclosure.
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ARTICLE VII
CLOSING
7.01. Closing Date. The Closing will be held on or before [*] (the
"Closing Date") at 10:00 a.m. local time at the offices of AT&T, 000 Xxxxxxxxxx
Xxxx, Xxxxxxx Xxxxx, XX, or at such other date, time and place as the parties
hereto will mutually agree. Notwithstanding the foregoing, the transactions
contemplated hereby will be deemed to be effective as of 12:01 a.m. on the
Closing Date.
7.02. Conditions to the Obligations of Cirrus. The obligation of Cirrus
and the Cirrus Partner to consummate the transactions contemplated hereby is
subject to and conditioned upon the satisfaction of each of the following
conditions, any or all of which may be waived in writing in whole or in part by
Cirrus and the Cirrus Partner:
(a) The representations and warranties of AT&T and AT&T
Partner contained in Article VIII and will be true and correct at and as of the
Closing Date as though such representations and warranties were made at and as
of such Closing Date.
(b) AT&T and the AT&T Partner will have performed and complied
in all material respects with all agreements, covenants and conditions on its
part required by this Agreement to be performed or complied with at or prior to
the Closing Date.
(c) On and prior to the Closing Date, no party to the
transactions contemplated hereby nor any of its Affiliates will have received
any notice of any threatened litigation or regulatory proceeding being
instituted or contemplated, and no such litigation or proceedings will be
pending, which challenge the legality hereof or the transactions contemplated
hereby or would have, individually or in the aggregate, a material adverse
effect on the transactions contemplated hereby.
(d) All approvals of applications to public authorities,
federal, foreign, state or local, the granting of which is necessary for the
consummation of the transactions contemplated hereby, will have been obtained
and be satisfactory to counsel to Cirrus.
(e) Cirrus will have received an opinion of counsel to AT&T,
who may be an employee of AT&T, dated the Closing Date, in a form reasonably
acceptable to counsel to Cirrus.
(f) All milestones to be achieved by AT&T set forth in the
Implementation Plan will have been completed.
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(g) All material obligations of AT&T set forth in the
Implementation Plan will have been discharged.
7.03. Conditions to Closing of AT&T. The obligation of AT&T and the
AT&T Partner to consummate the transactions contemplated hereby is subject to
and conditioned upon the fulfillment of each of the following conditions, any of
which may be waived in writing in whole or in part by AT&T and the AT&T Partner:
(a) The representations and warranties of Cirrus and the
Cirrus Partner contained in Article IX will be true and correct at and as of the
Closing Date as though such representations and warranties were made at and as
of such Date.
(b) Cirrus and the Cirrus Partner will have performed and
complied in all material respects with all agreements, covenants and conditions
on its part required by this Agreement to be performed or complied with prior to
or at the Closing Date.
(c) On or prior to the Closing Date, no party to the
transactions contemplated hereby nor any of their Affiliates will have received
any notice of any threatened litigation or regu latory proceeding being
instituted or contemplated, and no such litigation or proceedings will be
pending, which challenge the validity or legality hereof or the transactions
contemplated hereby or could have, individually or in the aggregate, a material
adverse effect on the transactions contemplated hereby.
(d) All approvals of applications to public authorities,
federal, foreign, state or local, the granting of which is necessary for the
consummation of the transaction contemplated hereby, will have been obtained and
be satisfactory to counsel to AT&T.
(e) AT&T will have received an opinion of counsel for Cirrus
dated the Closing Date, in a form reasonably acceptable to counsel to AT&T.
(f) All milestones to be achieved by Cirrus set forth in the
Implementation Plan will have been completed.
(g) All material obligations of Cirrus set forth in the
Implementation Plan will have been discharged.
7.04. Actions and Deliveries at Closing. At or prior to the Closing
(a) The AT&T Partner and the Cirrus Partner will take all of
the actions required by them as partners in the Partnership in order for the
Partnership to perform the actions required on its part by this Article VII and
will cause their nominees to the Board of Governors to vote for the approval of
such actions of the Partnership;
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(b) the AT&T Partner and the Cirrus Partner will make the
initial capital contributions to the Partnership as set forth in the GP
Agreement;
(c) AT&T and the AT&T Partner will deliver to Cirrus and the
Cirrus Partner the certificates and documents contemplated by Section 7.02 and
7.05 hereof;
(d) Cirrus and the Cirrus Partner will deliver to AT&T and the
AT&T Partner the certificates and documents contemplated by Section 7.03 and
7.05 hereof;
(e) the Partnership, AT&T, Cirrus, the AT&T Partner, the
Cirrus Partner and the other parties to the Material Agreements will execute and
deliver original counterparts of the Material Agreements; and
(f) the parties hereto will execute and deliver such other
documents, instruments, certificates or other items as a party will reasonably
request to be delivered at the Closing in connection with the transactions
contemplated herein.
7.05. Certificates. Each of the parties hereto will furnish to the
other party such certificates of such party's officers or others and such other
documents to evidence fulfillment of the conditions set forth in this Article
VII as the other party may reasonably request.
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES OF AT&T AND THE AT&T PARTNER
AT&T and the AT&T Partner jointly and severally represent and warrant
to Cirrus and the Cirrus Partner as follows:
8.01. Organization and Authority. Each of AT&T and the AT&T Partner is
a corporation duly organized and validly existing under the laws of the State of
New York, and has requisite power and authority (corporate and other) to own its
properties and to carry on its business as now being conducted. Each of AT&T and
the AT&T Partner has full power to execute and deliver this Agreement and the
Material Agreements and to consummate the transactions contemplated hereby and
thereby.
8.02. Authorization. (a) The execution and delivery of this Agreement
and the Material Agreements by AT&T and the AT&T Partner, and the documents and
agreements provided for herein and therein, and the consummation by AT&T and the
AT&T Partner of all transactions contemplated hereby or thereby, have been duly
authorized by all requisite corporate action. This Agreement and the Material
Agreements and all such other agreements and written obligations entered into
and undertaken in connection with the transactions contemplated hereby or
thereby to which each of AT&T and the AT&T Partner is a party, constitute or
will constitute following the execution and delivery thereof valid and legally
binding obligations of AT&T and the AT&T Partner, enforceable
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against them in accordance with their respective terms, subject as to
enforcement of remedies to applicable bankruptcy, insolvency, reorganization and
other laws affecting generally the enforcement of the rights of creditors and
subject to a court's discretionary authority with respect to the granting of a
decree ordering specific performance or other equitable remedies;
(b) The execution, delivery and performance by AT&T and the
AT&T Partner of this Agreement and the Material Agreements, as the case may be,
and the documents and agreements provided for herein and therein, and the
consummation by AT&T and the AT&T Partner of the trans actions contemplated
hereby and thereby, will not, with or without the giving of notice or the
passage of time or both: (i) violate the provisions of any applicable law; (ii)
violate the provisions of the Certificate of Incorporation or by-laws (each as
amended from time to time) of AT&T or the AT&T Partner or any resolution of its
directors or shareholders; and (iii) violate any judgment, decree, order or
award of any court, governmental agency or arbitrator; or (iv) conflict with or
result in the breach or termination of any material term or provision of, or
constitute a default under, or cause any acceleration under, any license,
permit, concession, franchise, indenture, mortgage, lease, equipment lease,
contract, permit, deed of trust or other instrument or agreement by which AT&T
or the AT&T Partner is or may be bound; and
(c) Each of AT&T and the AT&T Partner is not precluded by the
terms of any contract, agreement or other instrument by which either of them is
bound from entering into this Agreement and the Material Agreements, and the
documents and agreements provided for herein or therein or the consummation by
AT&T and the AT&T Partner of the transactions contemplated hereby and thereby.
8.03. Litigation. There are no actions, suits, investigations or other
proceedings pending or, to the knowledge of AT&T or the AT&T Partner,
threatened, there is no order, judgment or decree of any court or governmental
agency, and to the knowledge of AT&T or the AT&T Partner no facts or
circumstances exist, which could reasonably be expected to give rise to a claim,
action, suit or proceeding which could materially and adversely affect the
Partnership or the transactions contemplated hereby and by the Material
Agreements.
8.04. Financial Information. AT&T has previously delivered or will
deliver prior to the Closing Date to Cirrus the financial statements set forth
in the Reports on Form 10-K for the years ended December 31, 1994 and December
31, 1995, and the Reports on Form 10-Q for the quarters ended September 30, 1995
and March 31, 1996 (collectively referred to herein as the "AT&T Financial
Statements"). The AT&T Financial Statements present fairly in all material
respects the financial position and results of operations of AT&T as of the
dates and for the periods indicated thereon and are in conformity with GAAP,
consistently applied, except that the financial statements set forth in the
Reports on Form 10-Q for the quarters ended September 30, 1995 and March 31,
1996 are subject to normal year-end adjustments and any other adjustments
described therein, and do not contain all of the footnote disclosures required
by GAAP.
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8.05. Other Representations and Warranties. Certain representations and
warranties of AT&T and the AT&T Partner are made and set forth in the Material
Agreements. Such representations and warranties are incorporated herein by
reference and made a part hereof.
ARTICLE IX
REPRESENTATIONS AND WARRANTIES OF Cirrus AND THE CIRRUS PARTNER
Cirrus and the Cirrus Partner jointly and severally represent and
warrant to AT&T and the AT&T Partner as follows:
9.01. Organization and Authority. Each of Cirrus and the Cirrus Partner
is a corporation duly organized and validly existing under the laws of the State
of California, and has requisite power and authority (corporate and other) to
own its properties and to carry on its business as now being conducted. Each of
Cirrus and the Cirrus Partner has full power to execute and deliver this
Agreement and the Material Agreements and to consummate the transactions
contemplated hereby and thereby.
9.02. Authorization. (a) The execution and delivery of this Agreement
and the Material Agreements by Cirrus and the Cirrus Partner, and the documents
and agreements provided for herein and therein, and the consummation by Cirrus
and the Cirrus Partner of all transactions contemplated hereby or thereby, have
been duly authorized by all requisite corporate action. This Agreement and the
Material Agreements and all such other agreements and written obligations
entered into and undertaken in connection with the transactions contemplated
hereby or thereby to which each of Cirrus and the Cirrus Partner is a party,
constitute or will constitute following the execution and deli very thereof
valid and legally binding obligations of Cirrus and the Cirrus Partner,
enforceable against them in accordance with their respective terms, subject as
to enforcement of remedies to applicable bankruptcy, insolvency, reorganization
and other laws affecting generally the enforcement of the rights of creditors
and subject to a court's discretionary authority with respect to the granting of
a decree ordering specific performance or other equitable remedies;
(b) The execution, delivery and performance by Cirrus and the
Cirrus Partner of this Agreement and the Material Agreements, as the case may
be, and the documents and agreements provided for herein and therein, and the
consummation by Cirrus and the Cirrus Partner of the transactions contemplated
hereby and thereby, will not, with or without the giving of notice or the
passage of time or both: (i) violate the provisions of any applicable law; (ii)
violate the provisions of the Articles of Incorporation or by-laws (each as
amended from time to time) of Cirrus or the Cirrus Partner or any resolution of
its directors or shareholders; (iii) violate any judgment, decree, order or
award of any court, governmental agency or arbitrator; or (iv) conflict with or
result in the breach or termination of any material term or provision of, or
constitute a default under, or cause any acceleration under, any license,
permit, concession, franchise, indenture, mortgage, lease, equipment lease,
contract, permit, deed of trust or other instrument or agreement by which Cirrus
or the Cirrus Partner is or may be bound.
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(c) Each of Cirrus and the Cirrus Partner is not precluded by
the terms of any contract, agreement of other instrument by which either of them
is bound from entering into this Agreement and the Material Agreements, and the
documents and agreements provided for herein or therein or the consummation by
Cirrus and the Cirrus Partner of the transactions contemplated hereby and
thereby.
9.03. Litigation. There are no actions, suits, investigations or other
proceedings pending or, to the knowledge of Cirrus and the Cirrus Partner,
threatened, there is no order, judgment or decree of any court or governmental
agency, and to the knowledge of Cirrus or the Cirrus Partner no facts or
circumstances exist, which could reasonably be expected to give rise to a claim,
action, suit or proceeding which could materially and adversely affect the
Partnership or the transactions contemplated hereby and by the Material
Agreements.
9.04. Financial Information. Cirrus has previously delivered or will
deliver prior to the Closing Date to AT&T the financial statements set forth in
the Report on Form 10-K for the year ended April 1, 1995 and the Reports on Form
10-Q for the quarters ended July 1, 1995, September 30, 1995 and December 30,
1995 (collectively referred to herein as the "Cirrus Financial Statements"). The
Cirrus Financial Statements present fairly in all material respects the
financial position and results of operations of Cirrus as of the dates and for
the periods indicated thereon and are in conformity with GAAP, consistently
applied, except that the financial statements set forth in the Reports on Form
10-Q for the quarters ended July 1, 1995, September 30, 1995 and December 30,
1995 are subject to normal year-end adjustments and any other adjustments
described therein, and do not contain all of the footnote disclosures required
by GAAP.
9.05. Other Representations and Warranties. Certain representations and
warranties of Cirrus and the Cirrus Partner are made and set forth in the
Material Agreements. Such representations and warranties are incorporated herein
by reference and made a part hereof.
ARTICLE X
TERM AND TERMINATION
10.01. Term. Unless extended by agreement of the parties hereto, this
Agreement will terminate (a) in accordance with the provisions of this Article X
or (b) upon termination of the GP Agreement in accordance with the terms
thereof. Upon such termination, the parties hereto agree to take all of the
actions required to liquidate and dissolve to the Partnership in an orderly
manner.
10.02. Termination Prior to the Closing Date. This Agreement may be
terminated and the transactions herein contemplated may be abandoned as follows:
(a) By consent of the parties hereto at any time on or prior
to the Closing Date; or
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(b) By AT&T or the AT&T Partner if any of the conditions
provided for in Section 7.03 hereof will not have been met, or not have been
waived in writing by AT&T and the AT&T Partner, prior to or on the Closing Date;
or
(c) By Cirrus or the Cirrus Partner if any of the conditions
provided for in Section 7.02 hereof will not have been met, or not have been
waived in writing by Cirrus and the Cirrus Partner, prior to or on the Closing
Date; provided, however, that if the Closing has not occurred and this Agreement
has not been earlier terminated, or extended by agreement of the parties hereto,
this Agreement will terminate on December 31, 1996. If this Agreement is
terminated as provided herein, then no party hereto will have any liability or
further obligation to any other party hereto, except as stated in Section 2.02
and Article VI hereof, and except that nothing herein will relieve any party
from liability for any breach hereof prior to such termination. Notwithstanding
anything to the contrary contained in this Agreement, in the event that any
party hereto willfully fails to consummate the transactions contemplated by this
Agreement required to have been consummated on or prior to the Closing Date, any
other party hereto may seek any and all available remedies in a court of
competent jurisdiction with respect to liability therefor.
10.03. Termination Following the Closing Date; Events of Default;
Remedies.
(a) For purposes of this Agreement, each of the events in
Section 10.03(b) hereof will constitute an "Event of Default" hereunder. For
purposes of this Agreement, the party hereto giving rise to the Event of Default
is referred to herein as the "Defaulting Partner" and the party not giving rise
to the Event of Default is referred to herein as the "Non-Defaulting Partner".
If an Event of Default occurs, the remedies for such Event of Default will be as
set forth in Section 10.03(b) hereof with respect to such Event of Default;
provided, however, that no Event of Default will give rise to the remedies set
forth in Section 10.03(b) hereof unless such Event of Default is continuing
without resolution following the procedures set forth in Section 10.03(c)
hereof. The remedies provided herein are cumulative and will not preclude the
assertion by any party hereto of any other rights or seeking any other remedies
otherwise available against the other party hereto (including but not limited to
damages, specific performance and injunctive or other equitable relief).
(b) Events of Default and the remedies therefor are as
follows:
(i) A party hereto becomes insolvent (however such
insolvency may be evidenced) or makes a general assignment for the benefit of
creditors; in such event, the NonDefaulting Partner may elect to terminate this
Agreement upon written notice and in the event of such election to terminate
will also elect in such notice one of the following options (such options
collectively being referred to herein as the "Buy-Out Options"):
a. The Non-Defaulting Partner will purchase
the interest in the Partnership of the Defaulting Partner. Following
such notice, the Defaulting Partner will sell its interest in the
Partnership to the Non-Defaulting Partner for an agreed upon price, or
if no price can be agreed upon, the fair market value of such interest
as determined by an indepen dent qualified appraiser appointed by the
Defaulting Partner and the Non-Defaulting Partner.
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If they cannot agree on an appraiser, the Non-Defaulting Partner and
the Defaulting Partner will each choose an appraiser and the two
appraisers will choose one additional appraiser. The fair market value
of the interest of the Defaulting Partner will be determined by the
three appraisers or, if they cannot agree, will be the average of the
three appraisers' valuation. At the consummation of the sale of the
interest in the Partnership of the Defaulting Partner, the fair market
value of the Defaulting Partner's interest will be paid in cash or in
the form of a promissory note with such terms, interest rates, payment
amounts and other terms as will be mutually agreed upon by the
Non-Defaulting Partner and the Defaulting Partner; or
b. The Non-Defaulting Partner will sell its
interest in the Partnership to the Defaulting Partner or, subject to
the consent limitations set forth in subsections (b)(v) and (vi) below,
to a third party; or
c. The Non-Defaulting Partner and the
Defaulting Partner will take all actions required to dissolve the
Partnership.
(ii) A petition in bankruptcy, or for any relief
under any law relating to the relief of debtors, readjustment of indebtedness,
reorganization, composition or extension will be filed, or any proceeding will
be instituted under any such law, by or against a party hereto; in such event,
the Non-Defaulting Partner may elect to terminate this Agreement upon written
notice and in the event of such election to terminate will also elect one of the
Buy-Out Options.
(iii) Any governmental authority or any court at the
instance thereof will take possession of all or substantially all of the
property of, or assume control over the affairs or operations of, or a receiver
will be appointed for all or substantially all of the property of, or a writ or
order of attachment or garnishment will be issued or made against all or any
substantial part of the property of, a party hereto; in such event, the
Non-Defaulting Partner may elect to terminate this Agreement upon written notice
and in the event of such election to terminate will also elect one of the
Buy-Out Options.
(iv) Any party's failure to fund working capital
obligations of the Partnership following the Closing Date or make any payments
required under this Agreement or any of the Material Agreements following the
Closing Date; in such event, the Non-Defaulting Partner will have the option to
increase its share of OR2's Wafer (as defined in the Wafer Supply Agreement)
capacity in an amount equal to [*]. Illustrating by way of example but not of
limitation, if the Non-Defaulting Partner was entitled to [*] of the capacity of
OR2 prior to invocation of the [*], the Non-Defaulting Partner would be entitled
to [*] of the capacity of OR2 following invocation of the [*]. The [*] will be
subject to the following limitations:
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(a) the [*] will continue for so long as the
Event of Default remains uncured and for [*] thereafter;
(b) the Non-Defaulting Partner will purchase
Wafers subject to the [*] at [*] of the consideration payable for such
Wafers in the absence of the [*] and the Defaulting Partner will pay to
the Partnership [*] of the consideration payable for such Wafers in the
absence of the [*], in each case pursuant to the terms of the Wafer
Supply Agreement, for so long as the [*] is in effect;
(c) the [*] may not be imposed with respect
to the continuation of an Event of Default during the period that such
Event of Default remains uncured;
(d) the [*] will be limited to a maximum of
[*] of the total capacity of OR2, and the [*] will at all times be
based on total capacity of OR2 (and not the capacity of OR2 remaining
after any application of any [*]).
(v) A change in the beneficial ownership or voting control of
more than fifty percent (50%) of the equity securities of Cirrus, the Cirrus
Partner or the Integrated Circuits Group of AT&T Microelectronics such that
after the change the same are owned directly or indirectly by one Person (or any
Affiliate of such Person), the merger or consolidation of Cirrus, the Cirrus
Partner or the Integrated Circuits Group of AT&T Microelectronics with or into
any person or entity which is not an Affiliate of such party, or the sale of all
or substantially all of the assets of Cirrus, the Cirrus Partner or the
Integrated Circuit Division of AT&T Microelectronics; in such event, the
NonDefaulting Partner may, subject to the following, terminate this Agreement
upon written notice and in the event of such election to terminate will also
elect one of the Buy-Out Options:
(a) The foregoing will not apply to any
change of control pursuant to any transaction effecting the
Restructuring; and
(b) Demonstration by the Non-Defaulting
Partner, exercising its reasonable business judgment, that such change
of control is unacceptable.
(vi) The material breach by any party hereto of any other
provision of this Agreement or any of the Material Agreements (other than the
failure to make payments hereunder or thereunder and other than a breach of the
Lease); in such event, the Non-Defaulting Partner may elect to terminate this
Agreement upon written notice and in the event of such election to terminate
will also elect one of the Buy-Out Options; provided, however, that if the
Non-Defaulting Partner elects option (a) of the Buy-Out Options, the fair market
value determined by the appraisers, and therefore the amount paid by the
Non-Defaulting Partner for the interest in the Partnership of the Defaulting
-23-
Partner, will be [*]; and provided, further, that any sale to a third party
pursuant to option (b) of the Buy-Out Options will be subject to the consent of
the Defaulting Party, such consent not to be unreasonably withheld.
[*]
(c) The parties hereto will follow the following procedures in
connection with the foregoing:
(i) Notice. If an event occurs which, if uncured,
would give rise to an Event of Default, the Non-Defaulting Partner will give a
notice to the Defaulting Partner specifying in reasonable detail such event, and
the Defaulting Partner will have [*] after receipt of such notice to cure such
event. In the absence of such cure, an Event of Default will be deemed to have
occurred as of the first date of the occurrence of such event. Notwithstanding
anything to the contrary contained in this Agreement, the procedures set forth
in this Section 10.03 will commence and continue during the [*] cure period.
(ii) Consultation/Mediation/Arbitration. The parties
will attempt to resolve the event through consultation and mediation in
accordance with the provisions of Section 13.02(b) hereof (even during the [*]
cure period described in the immediately preceding subsection (i)), but any
mediation pursuant to Section 13.02(b) hereof will occur within [*] after
selection of the mediator, or such other period to which the parties may
otherwise agree. If the event giving rise to the Event of Default specified in
sections (b)(i) through (iv) of this Section 10.03 remains uncured following the
[*] cure period, the Non-Defaulting Partner may invoke the applicable remedies
speci fied in section (b) of this Section 10.03. If the event giving rise to the
Event of Default specified in sections (b)(v) or (vi) of this Section 10.03
remains uncured following the [*] cure period, the parties hereto will pursue
resolution of the matter pursuant to the procedures for mediation and
arbitration set forth in Article XIII hereof. No failure by a party to provide
notice as set forth in this Section 10.03(c) with respect to a breach hereof or
a default by any other party will constitute a waiver of the former party's
right to enforce any provision hereof or to take action with respect to such
breach or default or any subsequent breach or default.
(iii) Arbitration. If the event remains unresolved
following exhaustion of the procedures set forth in the immediately preceding
subsection (ii), the event will be subject to the arbitration provisions set
forth in Section 13.02(c) hereof.
(d) The parties hereto hereby agree that in the event of a
sale pursuant to this Section 10.03:
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(i) for purposes of this Section 10.03 only, the
interest in the Partnership of AT&T will be deemed to include the AT&T Assets,
the other assets of AT&T and the AT&T Partner comprising XX0, XX0, the Premises
and the Land;
(ii) for purposes of this Section 10.03 only, the
interest in the Partnership of Cirrus will be deemed to include the Cirrus
Assets and the other assets of Cirrus and the Cirrus Partner comprising OR2; and
(iii) such sale will be consummated as soon as
reasonably practicable following the occurrence of the Event of Default and the
election of option (a) or (b) of the Buy-Out Options by the Non-Defaulting
Partner.
In the event of any such sale in which the AT&T Partner is the Partner selling
its interest in the Partnership, AT&T will use its reasonable best efforts to
cause all leases and other agreements covering the AT&T Assets to be assigned to
the Partner or third-party purchasing such interest, and the Partner or
third-party purchasing such interest will assume all obligations under any such
leases and other agreements. In the event of any such sale in which the Cirrus
Partner is the Partner selling its interest in the Partnership, Cirrus will use
its reasonable best efforts to cause all leases and other agreements covering
the Cirrus Assets to be assigned to the Partner or third-party purchasing such
interest, and the Partner or third-party purchasing such interest will assume
all obligations under any such leases and other agreements. The parties hereto
acknowledge and agree that AT&T and its Affiliates may, in its or their sole
discretion, enter into transactions, agreements, understandings or arrangements
with respect to the Premises and/or the Land, including but not limited to those
which may give rise to sales, over leases, mortgages, security interests, liens
or encumbrances; provided, however, that in the event of any such transactions,
agreements, understandings or arrangements, the Lease will not be terminated
other than in accordance with the terms thereof.
(e) Notwithstanding anything to the contrary contained in this
Article X, the parties hereto agree that a Deadlock will not result in an Event
of Default or be subject to arbitration hereunder and will be resolved in
accordance with the procedures contained in Sections 13.02 and 3.02(a) hereof.
10.04. Continuing Obligations of the Parties. Notwithstanding the
termination of this Agreement pursuant to Section 10.03, (i) each of the
Material Agreements will continue or terminate in accordance with its terms,
(ii) each party hereto agrees, and agrees to cause its Affiliates, to con tinue
for a one (1) year transition period, or if shorter as may be agreed to by the
parties hereto and thereto, as the case may be, for their remaining terms, such
agreements and arrangements between the Partnership and such party or its
Affiliate with respect to the furnishing of products, premises or services as
may then be in existence and (iii) each party hereto agrees to provide for such
transition period the reasonable assistance, on terms and conditions to be
agreed upon, of such party and its Affiliates in effecting an orderly transition
of the Partnership's business. Unless otherwise agreed to in writing by the
parties hereto and their Affiliates which are parties to the Material
Agreements, the transition period under clauses (ii) and (iii) of this Section
10.04 will not extend for more than one (1) year following the consummation of a
sale pursuant to Section 10.03.
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10.05. Survival. All representations and warranties will survive the
Closing Date and any investigation at any time made by or on behalf of any party
until the third anniversary of the Closing Date. All covenants and agreements
made by the parties hereto or pursuant hereto or in any other agreement,
instrument or document delivered in connection herewith, including, but not
limited to, the Material Agreements, will survive the Closing Date.
ARTICLE XI
INDEMNIFICATION
11.01. Agreement to Indemnify. (a) Upon the terms and subject to the
conditions of this Article XI, AT&T and the AT&T Partner (the "AT&T Group")
hereby agrees to indemnify:
(i) Cirrus and the Cirrus Partner (the "Cirrus
Group") from and against any liabilities or damages resulting to the Cirrus
Group by reason or resulting from any inaccuracy in, or any breach of, any
representation or warranty, covenant or agreement of the AT&T Group contained in
or made pursuant to this Agreement or in or made pursuant to the Material
Agreements, except as otherwise specified therein; and
(ii) the Landlord from and against any liabilities or
damages resulting to the Landlord by reason or resulting from any matter or the
existence of any condition described in Section 4.10(a)(i) and 4.10(b)(i)
hereof.
(b) Upon the terms and subject to the conditions of this
Article XI, the Cirrus Group hereby agrees to indemnify:
(i) the AT&T Group from and against any liabilities
or damages resulting to the AT&T Group by reason or resulting from any
inaccuracy in, or any breach of, any representa tion or warranty, covenant or
agreement of the Cirrus Group contained in or made pursuant to this Agreement or
in or made pursuant to the Material Agreements, except as otherwise specified
therein; and
(ii) the Landlord from and against any liabilitie
Landlord by reason or resulting from any matter or the existence of any
condition described in Section 4.10(a)(ii) and 4.10(b)(ii) hereof.
(c) Each matter for which the AT&T Group or the Cirrus Group
has agreed to provide indemnification pursuant to Section 11.01(a) or 11.01(b)
hereof is hereinafter referred to as a "Claim" and collectively as "Claims".
11.02. Conditions of Indemnification. The obligations and liabilities
of the AT&T Group, on the one hand, and the Cirrus Group, on the other hand,
under Section 11.01 hereof with respect to Claims will be subject to the
following terms and conditions:
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(a) The person seeking indemnification (the "Indemnified
Party") will give the person providing indemnification (the "Indemnifying
Party") prompt notice of any such Claim, which notice will set forth the details
of the Claim and the specific provisions of this Agreement relating thereto, and
the Indemnifying Party will undertake the defense thereof by representatives
chosen by it. The notice will set forth the details of the Claim and the
specific provisions of this Agreement relating thereto.
(b) The Indemnified Party will make available to the
Indemnifying Party all records or other materials reasonably requested by it for
its use in contesting any Claim and will cooperate fully with the Indemnifying
Party in the defense of all such Claims.
(c) If the Indemnifying Party, within a reasonable time after
notice of any such Claim, fails to defend the Indemnified Party, the Indemnified
Party (upon further notice to the Indemnifying Party) will have the right to
undertake the defense, compromise or settlement of such Claim on behalf of and
for the account and risk of the Indemnifying Party, subject to the right of the
Indemnifying Party to assume the defense of such Claim at any time prior to
settlement, compromise or final determination thereof.
(d) Anything in this Section 11.02 to the contrary
notwithstanding, (i) if there is a reasonable probability that a Claim may
materially and adversely affect the Indemnified Party other than as a result of
money damages or other money payments, the Indemnified Party will have the right
to defend, compromise or settle such Claim; provided, however, that no
settlement which would require indemnification by the Indemnifying Party will be
entered into without the consent of the Indemnifying Party, which consent will
not be unreasonable withheld or delayed, and (ii) the Indemnifying Party, will
not settle or compromise any Claim or consent to the entry of any judgment which
does not include, as an unconditional term thereof, the giving by the claimant
or the plaintiff to the Indemnified Party of a release from all liability in
respect of such Claim.
(e) The AT&T Group will have no obligation to indemnify for
liabilities or damages under Section 11.01(a)(i) hereof and the Cirrus Group
will have no obligation to indemnify for liabilities or damages under Section
11.01(b)(i) hereof unless and until the aggregate of their respective
liabilities or damages exceeds [*], and in no event will the amount payable
pursuant to the AT&T Group's obligation to indemnify for liabilities or damages
under Section 11.01(a)(i) hereof or the amount payable pursuant to the Cirrus
Group's obligation to indemnify for liabilities or damages under Section
11.02(b)(i) exceed [*].
(f) No loss, damage or expense will be deemed to have been
sustained by an Indemnified Party under this Article XI to the extent of (i) any
tax savings realized by such Indemnified Party with respect thereto or (ii) any
proceeds received by such Indemnified Party from
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any insurance policies with respect thereto; provided, however, that the parties
hereto acknowledge and agree that no party will be required pursuant to this
Article XI to mitigate liabilities or damages by seeking tax savings or
insurance proceeds.
ARTICLE XII
AUDITORS; ACCOUNTING MATTERS
12.01. Independent Accountant. The Partnership will retain Coopers &
Xxxxxxx as its initial Independent Accountant. In the event that AT&T or its
successors or assigns does not appoint Coopers & Xxxxxxx as its independent
public accountant, the Partnership will retain such other independent public
accountant as AT&T or its successors or assigns may appoint.
12.02. Financial Statements. The Partnership will maintain at its
principal office books, records and reports pertaining to all operations and
reflecting, in accordance with the accounting standard prescribed in this
Section 12.02, all receipts and expenditures of the Partnership and as otherwise
required by applicable law. The financial statements and books and records of
the Partnership will be maintained in accordance with GAAP. The year-end
financial statements of the Partnership will be audited by the Independent
Accountant. The Independent Accountant will submit to the Partnership its
report(s) on the financial statements of the Partnership and the schedules with
respect thereto prepared in accordance with GAAP and in such form and substance
as to allow consolidation of the Partnership's financial statements with the
financial statements of AT&T.
12.03. Reports. As soon as available and in any event within forty-five
(45) days after the end of each fiscal quarter of the Partnership during the
first fiscal year of the Partnership, and within thirty (30) days after the end
of each fiscal quarter of the Partnership thereafter, the Partnership will
provide to each party hereto an unaudited consolidated balance sheet and profit
and loss statement of the Partnership and its subsidiaries, if any, and a cash
flow statement for such period prepared in accordance with GAAP. As soon as
available and in any event within ninety (90) days after the close of the first
fiscal year of the Partnership, and within sixty (60) days after the close of
each fiscal year of the Partnership thereafter, the Partnership will provide
each party hereto with a consolidated balance sheet and profit and loss
statement of the Partnership and its subsidiaries, if any, and a cash flow
statement as at the end of and for the fiscal year, reviewed (but not audited)
by the Independent Accountant, prepared in accordance with GAAP.
12.04. Fiscal Year. The Partnership's fiscal year will be the calend
designated at a general meeting of the members of the Partnership.
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ARTICLE XIII
NOTICE OF DEADLOCK OR DISPUTE; DISPUTE RESOLUTION;
ARBITRATION
13.01. Notice. (a) If the parties hereto or the Board of Governors are
unable to agree on any matter relating to the management or operation of the
Partnership or the Business requiring the approval of the parties hereto or the
members of the Board of Governors pursuant to this Agreement or the Material
Agreements, then any of the parties hereto may declare that a "Deadlock" exists
and so notify the other parties hereto, in which event the parties hereto will
resolve the dispute pursuant to the procedures set forth in Sections 13.02 and
3.02(a) hereof. If the parties hereto or the Board of Governors are unable to
agree on any matter (other than any matter relating to the management or
operation of the Partnership or the Business requiring the approval of the
parties hereto or the mem bers of the Board of Governors pursuant to this
Agreement or the Material Agreements) relating to a dispute or claim arising out
of or related to this Agreement or the Material Agreements, or the
interpretation, making, performance, breach or termination hereof or thereof,
then any of the parties hereto may declare that a "Dispute" exists and so notify
the other parties hereto, in which event the parties hereto will resolve the
Dispute pursuant to the procedures set forth in Sections 13.02 and 13.03 hereof.
(b) Pending final resolution of the Deadlock or Dispute in
accordance herewith, the Partnership will (i) continue its operations under, or
revert to, the most recently approved Annual Plan, and (ii) not undertake any
action which is the subject of the Deadlock or Dispute.
(c) Notwithstanding the provisions of Sections 13.02 and 13.03
hereof, with respect to Disputes, the parties hereto may apply to any court of
competent jurisdiction for a tem porary restraining order, preliminary
injunction, or other interim or conservatory relief, as may be necessary,
without breach of this Article XIII, without any abridgment of the powers of the
arbi trators as described in Section 13.03 hereof and without breach of the
parties' obligations to consult, mediate and arbitrate the Dispute pursuant to
the terms of this Article XIII.
13.02. Deadlock and Dispute Resolution.
(a) Consultation. (i) Within ten (10) days of the notice
pursuant to Section 13.01 hereof (or such other period to which the parties
hereto may otherwise agree), the parties hereto will first submit the Deadlock
or Dispute to [*], as AT&T's and the AT&T Partner's first executive
representative, and to Cirrus' [*], as Cirrus's and the Cirrus Partner's first
executive representative (such first executive representatives are together
referred to herein as the "First Representatives"), to attempt to resolve the
Deadlock or Dispute. The parties hereto agree to use their reasonable best
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efforts to cause the First Representatives to meet (by telephone, conference or
otherwise) at mutually convenient times and locations, and the First
Representatives will have [*] days following the submis sion of the Deadlock or
Dispute to the First Representatives (or such other period to which the parties
hereto may otherwise agree) to resolve the Deadlock or Dispute. AT&T and Cirrus
will promptly notify each other with respect to any change in the identity of
the First Representatives.
(ii) In the event that the First Representatives are
unable to resolve the Deadlock or Dispute within [*] days following the
submission of the Deadlock or Dispute to the First Representatives (or such
other period to which the parties hereto may otherwise agree), then the Deadlock
or Dispute will be referred to [*], as AT&T's and the AT&T Partner's second
executive representative, and to Cirrus' [*], as Cirrus's and the Cirrus
Partner's second executive representative (such second execute representatives
are together referred to herein as the "Second Representatives"), to attempt to
resolve the Deadlock or Dispute. The parties hereto agree to use their
reasonable best efforts to cause the Second Representatives to meet (by
telephone, conference or otherwise) at mutually convenient times and locations,
and the Second Representatives will have [*] days following the submission of
the Deadlock or Dispute to the Second Representatives (or such other period to
which the parties hereto may otherwise agree) to resolve the Deadlock or
Dispute. AT&T and Cirrus will promptly notify each other with respect to any
change in the identity of the Second Representatives.
(b) Mediation. In the event that the Second Representatives
are unable to resolve the Deadlock or Dispute within [*] days following the
submission of the Deadlock or Dispute to the Second Representatives (or such
other period to which the parties hereto may otherwise agree), then the parties
hereto will, within [*] days following the submission of the Deadlock or Dispute
to the Second Representatives (or such other period to which the parties hereto
may otherwise agree), either: (a) agree upon a mediator to attempt to aid
resolution of the Deadlock or Dispute; or (b) notify the American Arbitration
Association (the "AAA") of the Deadlock or Dispute, and request that the AAA
appoint a mediator within [*] days of such notice to the AAA to conduct a
mediation under the Commercial Mediation Rules of the AAA to attempt to aid
resolution of the Deadlock or Dispute. Any mediation pursuant to this Section
13.02(b) will occur within [*] days after selection of the mediator.
13.03. Arbitration. (a) Any Dispute which has not been finally resolved
by the consultation or mediation procedures described in Section 13.02 hereof
will be finally settled by binding arbitration in Atlanta under the Commercial
Arbitration Rules and Supplementary Procedures for Large, Complex Disputes of
the AAA (the "LCCP Rules") by three arbitrators. Judgment on the award rendered
by the arbitrators may be entered in any court having jurisdiction thereof.
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(b) The arbitrators will apply New York law to the merits of
the Dispute, without reference to its conflicts of laws principles. The
arbitration proceedings will be governed by the United States Arbitration Act
and by the LCCP Rules, without reference to the arbitration law of the State of
New York, subject to all of the following:
(i) The AAA will provide the parties hereto with a
list of potential arbitrators from the National LCCP Panel. Within [*] days
thereafter, each of AT&T and Cirrus will select one arbitrator and, if possible,
AT&T and Cirrus will jointly agree on a third arbitrator who will be the chair
of the arbitral tribunal. If either of AT&T or Cirrus fails to appoint an
arbitrator, or if AT&T and Cirrus do not jointly agree on a third arbitrator
within such [*] day period, the AAA will, within [*] days following such failure
or disagreement, appoint such arbitrator(s) from the National LCCP Panel. The
arbitrators appointed by AT&T and Cirrus may be, but are not required to be,
from the National LCCP Panel. All arbitrators will be neutral and independent or
will be disqualified.
(ii) The parties hereto will have access to all
Partnership records and each other's records with respect to the Partnership,
and the arbitrators will require that such records, together with any other
documents allowed by the arbitrators, be made available and exchanged within [*]
days following the appointment of the third arbitrator.
(iii) The arbitrators will cause the arbitration
hearing to occur within [*] days of the appointment of the third arbitrator, and
the arbitrators will render their award within [*] days of the conclusion of the
arbitration proceedings.
(iv) Following consultation with the parties hereto,
the arbitrators will enter an appropriate protective order to maintain the
confidentiality of information produced or exchanged in the course of the
arbitration proceedings.
(v) The arbitrators will be directed by the terms of
this Agreement to conclusively resolve the Dispute; provided, however, that the
arbitrators may not limit, expand or otherwise modify the terms of this
Agreement.
(vi) The arbitrators will award to the prevailing
party hereto, if any, as determined by the arbitrators, all of its costs and
fees, including without limitation administrative fees, arbitrator fees, travel
expenses, out-of-pocket expenses, such as copying and telephone, facsimile,
witness fees and attorneys' fees.
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ARTICLE XIV
MISCELLANEOUS
14.01. Notices. Any notice to be given under this Agreement will be
duly given upon receipt when in writing and delivered in person, by facsimile tr
by courier, addressed as follows:
(a) If to AT&T or the AT&T Partner:
AT&T Corp.
000 Xxxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxx
Facsimile: 000-000-0000
with a copy to:
AT&T Corp.
AT&T Xxxxxxxxxxxxxxxx
Xxx Xxx Xxx
Xxxxxxxx Xxxxxxx, XX 00000
Attention: Law Department
Facsimile: 000-000-0000
(b) If to Cirrus or the Cirrus Partner:
Cirrus Logic, Inc.
0000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, XX 00000-0000
Attention: Xx Xxxx
Facsimile: 000-000-0000
with a copy to:
Wilson, Sonsini, Xxxxxxxx & Xxxxxx
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, XX 00000-0000
Attention: Xxxxxx X. Xxxxxxxxxxxx, Esq.
Facsimile: 000-000-0000
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(c) If to the Partnership:
Addressed to the Partnership as
Named in the General Partnership
Agreement
0000 Xxxxx Xxxx Xxxxx Xxxxxxx
Xxxxxxx, XX
with a copy to:
AT&T Corp.
000 Xxxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxx
Facsimile: 000-000-0000
and with an additional copy to:
Cirrus Logic, Inc.
0000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, XX 00000-0000
Attention: Xx Xxxx
Facsimile: 000-000-0000
Any party or the Partnership may change its address provided above for the
purpose hereof by giving written notice to the other party hereto of such change
in the manner hereinabove provided.
14.02. Governing Law. This Agreement and all questions of its
interpretation will be construed in accordance with the laws of the State of New
York without regard to its principles of conflicts of laws.
14.03. Assignment. Except to the extent permitted under Article X
hereof, the rights and obligations under this Agreement may not be assigned by
any party to any person; provided, however, AT&T may assign this Agreement and
its rights and obligations hereunder in connection with any transaction
effecting the Restructuring and any such assignment will release AT&T of its
obligations and liabilities hereunder. Any other attempted assignment in
contravention of this provision will be void.
14.04. Limitation of Liability. Notwithstanding anything to the
contrary contained herein, none of the parties hereto or their respective
Affiliates will be liable for the incidental, indirect, special or consequential
damages of the other party hereto or its Affiliates. THEREFORE, THE PARTIES
HERETO (INCLUDING FOR THIS PURPOSE THEIR AFFILIATES) EXPRESSLY
ACKNOWLEDGE AND AGREE THAT THEY WILL NOT BE LIABLE FOR EACH OTHER'S
INCIDENTAL, INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES (INCLUDING LOST
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PROFITS OR LOST REVENUES) UNDER THIS AGREEMENT OR THE MATERIAL AGREEMENTS,
REGARDLESS OF WHETHER SUCH LIABILITY ARISES IN TORT, CONTRACT, BREACH OF
WARRANTY, INDEMNIFICATION OR OTHERWISE.
14.05. Further Assurances. The parties hereto and the Partnership will,
from time to time and without further consideration, execute and deliver such
other documents and instruments of transfer, conveyance and assignment and take
such further action as the other may reasonably require to effect the
transactions contemplated hereby.
14.06. Entire Agreement. This Agreement and the Material Agreements,
together with all Exhibits, Schedules, Appendices and attachments hereto and
thereto, represent the entire agreement and understanding between the parties
hereto with respect to the subject matter hereof and supersedes any prior
agreement or understanding, written or oral, that the parties hereto may have
had, except for that certain letter agreement between AT&T and Cirrus dated May
5, 1995.
14.07. Amendments. Any modification, amendment, or waiver of any
provision hereof will be effective if, but only if, in writing and signed in
person or by an authorized representative of each party against whom enforcement
of such modification, amendment or waiver is sought.
14.08. Captions. The title headings of the respective articles and
sections hereof are inserted for convenience and will not be deemed to be a part
hereof or considered in construing this Agreement.
14.09. Severability. If any article, section or paragraph, or part
thereof, hereof, or any agreement or document appended hereto or made a part
hereof is invalid, ruled illegal by any court of competent jurisdiction, or
unenforceable under present or future laws effective during the term hereof,
then it is the intention of the parties hereto that the remainder of the
Agreement, or any agreement or document appended hereto or made a part hereof,
will not be affected thereby unless the deletion of such provision will cause
this Agreement to become materially adverse to any party in which case the
parties hereto will negotiate in good faith such changes to this Agreement as
will best preserve for the parties hereto the benefits and obligations of such
provision.
14.10. Counterparts. This Agreement may be executed in two or more
counterparts, and by each party on the same or different counterparts, but all
of such counterparts will together constitute one and the same instrument.
14.11. Waivers. No failure by a party to take any action with respect
to a breach hereof or a default by any other party will constitute a waiver of
the former party's right to enforce any provision hereof or to take action with
respect to such breach or default or any subsequent breach or default. Waiver by
any party of any breach or failure to comply with any provision hereof by a
party will not be construed as, or constitute, a continuing waiver of such
provision, or a waiver of any other breach of or failure to comply with any
other provision hereof.
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14.12. Public Announcements. No party hereto will, without the approval
of both AT&T and Cirrus, make any press release or other public announcement or
response to an inquiry initiated by the press concerning the terms of the
transactions contemplated by this Agreement or any of the Material Agreements,
except as and to the extent that any such party will be so obligated by law, in
which case both AT&T and Cirrus will be so advised and the parties hereto will
use their best efforts to cause a mutually agreeable release or announcement to
be made. If either party hereto receives any inquiries with respect to this
Agreement or the transactions contemplated hereby, such party may address such
inquiry to the extent required by law; provided, however, in no event will such
party disclose Confidential Information in the course of such disclosure, except
as otherwise permitted in accor dance with Article VI hereof. The parties hereto
will cooperate in making public announcements concerning this Agreement
immediately following the date of its execution by all parties hereto and
immediately following the Closing Date. Nothing in this Section 14.12 will be
construed to restrict the Partnership from conducting its marketing,
advertising, public relations and related activities.
14.13. No Agency. This Agreement will not constitute either party
hereto as the legal representative or agent of the other, nor will either party
hereto have the right or authority, to assume, create or incur any liability or
obligation, express or implied, against, in the name of, or on behalf of the
other party hereto, or the Partnership.
14.14. No Third Party Beneficiaries. Nothing expressed or mentioned in
this Agreement is intended or will be construed to give any person other than
the parties hereto, the Partnership and their respective successors and
permitted assigns any legal or equitable right, remedy or claim under or in
respect hereof or any provision herein contained.
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IN WITNESS WHEREOF, this Agreement has been duly executed by or on
behalf of each of the parties hereto as of the date first above written.
AT&T CORP.
By:
--------------------------
Name:
Title:
ATOR CORP.
By:
--------------------------
Name:
Title:
CIRRUS LOGIC, INC.
By:
--------------------------
Name:
Title:
CIROR, INC.
By:
--------------------------
Name:
Title:
-00-
Xxxxxxxx
Xxxxxxxxxx Positions; Relocation Principles
1. Ten Positions: AT&T will obtain prior consent from Cirrus, such consent
not to be unreasonably withheld, for relocation of employees staffing
jobs identified in the list to be provided by Cirrus at or prior to the
Closing. In the event that such relocation is initiated by an employee
rather than by AT&T, Cirrus will provide its consent to such
relocation, which relocation will occur within ninety (90) days of
notice by AT&T. In the event of a proposed relocation, AT&T will
identify a replacement for such relocated employee prior to seeking
Cirrus' approval for such relocation.
2. Other AT&T Employees: Reassignment will be limited in accordance with
the terms of the Annual Plan.
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