EXHIBIT 2.3
THIS AGREEMENT, is entered into as of June 3, 2000 (the "Effective Date")
between Cabletron Systems, Inc. ("Cabletron"), each direct and indirect
subsidiary of Cabletron (whether presently existing or hereafter formed or
acquired) included as a member of the Cabletron Affiliated Group (as defined
below) in any year and not included as a member of an Affiliated Subsidiary
Group (as defined below) (all such Cabletron subsidiaries together with
Cabletron being the "Cabletron Group"), Aprisma Management Technologies, Inc.
("Aprisma"), each direct and indirect subsidiary of Aprisma (whether presently
existing or hereafter formed or acquired) included as a member of the Cabletron
Affiliated Group in any year (all such Aprisma subsidiaries together with
Aprisma being the "Aprisma Group"), Enterasys Networks, Inc. ("Enterasys"), each
direct and indirect subsidiary of Enterasys (whether presently existing or
hereafter formed or acquired) included as a member of the Cabletron Affiliated
Group in any year (all such Enterasys subsidiaries together with Enterasys being
the "Enterasys Group"), GlobalNetwork Technology Services, Inc. ("GNTS"), each
direct and indirect subsidiary of GNTS (whether presently existing or hereafter
formed or acquired) included as a member of the Cabletron Affiliated Group in
any year (all such GNTS subsidiaries together with GNTS being the "GNTS Group"),
Riverstone Networks, Inc. ("Riverstone"), each direct and indirect subsidiary of
Riverstone (whether presently existing or hereafter formed or acquired) included
as a member of the Cabletron Affiliated Group in any year (all such Riverstone
subsidiaries together with Riverstone being the "Riverstone Group"), and
together with the Aprisma Group, the Enterasys Group and the GNTS Group, the
Riverstone Group, the "Affiliated Subsidiary Groups").
WHEREAS, the Cabletron Group and the Affiliated Subsidiary Groups are part
of an Affiliated Group filing consolidated federal income tax returns and
certain consolidated, combined and unitary state or local income tax returns;
WHEREAS, the parties hereto wish to set forth their agreement with respect
to the allocation and payment of federal, state, local and foreign income and
employment taxes attributable to them, and to allocate responsibility for the
preparation and filing of returns and the maintenance of records for all periods
through, or which include, the Distribution (as defined below) of one or more of
the Affiliated Subsidiary Groups;
WHEREAS, Cabletron has transferred certain operations conducted by it to
the Affiliated Subsidiary Groups and may distribute the stock of one or more of
Aprisma, GNTS, Riverstone and Enterasys (each a "Subsidiary Group Parent") to
Cabletron stockholders in one or more transactions (each a "Distribution")
intended to qualify as tax-free transactions under section 355 of the Internal
Revenue Code of 1986, as amended (the "Code"); and
WHEREAS, the parties hereto wish to set forth their agreement with respect
to the allocation of tax and other liability by reason of the Distributions.
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NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements hereinafter set forth, the parties hereby agree,
effective as of the Effective Date, as follows:
1. Definitions.
As used in this Agreement:
"Affiliated Group" shall mean an affiliated group of corporations
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within the meaning of section 1504(a) of the Code for the taxable year
in question.
"Cabletron Affiliated Group" shall mean, for any taxable year of
--------------------------
Cabletron, the Affiliated Group of which Cabletron is the common
parent for such year.
"Contributed Business" shall mean, with respect to an Affiliated
--------------------
Subsidiary Group, the business (including assets, liabilities,
employees and all other tangible and intangible property), whether
originally formed or acquired by Cabletron, contributed by Cabletron
to the Affiliated Subsidiary Group and not distributed back to
Cabletron.
"Distribution Date" shall mean, with respect to an Affiliated
-----------------
Subsidiary Group, the date of the Distribution of its Subsidiary Group
Parent.
"Federal Income Tax" shall mean any U.S. federal income tax, including
------------------
any interest, penalty or addition thereto, whether disputed or not.
"Market Valuation" shall mean for any Distribution of a Subsidiary
----------------
Group Parent as of its Distribution Date (i) with respect to the
Subsidiary Group Parent, the fair market value of all of its
outstanding stock (measured using the mean of the high and low of the
public trading price) as of such date, or (ii) with respect to
Cabletron, the fair market value of all of its outstanding stock
(measured using the mean of the high and low of the public trading
price) as of such date, less the fair market value of all of the
outstanding stock of the other Subsidiary Group Parents (measured
using the mean of the high and low of the public trading price, if
any, or other similar measure of fair market value as determined by
Cabletron), as of such date, that are distributed subsequent to such
Distribution Date.
"Member" shall mean, during the period that such member is includable,
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each includable member of the Cabletron Affiliated Group for such
year.
"Other Income Tax" shall mean any state, local or foreign income tax,
----------------
including any interest, penalty or addition thereto, whether disputed
or not.
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"Other Tax" shall mean any payroll or other employment tax, including
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any interest, penalty or addition thereto, whether disputed or not.
"Pre-Contribution Year" shall mean, with respect to an Affiliated
---------------------
Subsidiary Group, any taxable year of the Cabletron Affiliated Group
ending on or before February 29, 2000, and any other taxable year of
the Cabletron Affiliated Group during any part of which the Cabletron
Group conducted the Contributed Business of such Affiliated Subsidiary
Group.
"Pre-Distribution Year" shall mean, with respect to an Affiliated
---------------------
Subsidiary Group, a taxable year of the Cabletron Affiliated Group
beginning prior to (and including) the Distribution of the Subsidiary
Group Parent of such Affiliated Subsidiary Group.
"Separate Return Tax Liability" shall mean, with respect to an
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Affiliated Subsidiary Group for any Pre-Distribution Year, the sum of
the Federal Income Tax for each member of the Affiliated Subsidiary
Group for such year determined by using the method described in
section 1.1502-32(b)(3)(iv)(D) of the Treasury Regulations.
"Spin Damages," shall mean, with respect to a Distribution of an
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Affiliated Subsidiary Group, Taxes and other damages suffered
(including reasonable attorneys' and expert witness fees and
disbursements in connection with the investigation, defense or
settlement of any action or threatened action) attributable either to
the failure of such Distribution to qualify under section 355 of the
Code or attributable to the application of section 355(e) with respect
to such Distribution.
"Tax" shall mean Federal Income Tax, Other Income Tax and Other Tax.
---
"Tax Returns" and "Returns" shall include all returns, other forms or
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statements in respect of Taxes which are required or permitted to be
filed.
"Transformation Agreement" shall mean the transformation agreement
------------------------
entered into by Cabletron, Aprisma, GNTS, Riverstone and Enterasys as
of June 3, 2000.
"Treasury Regulations" shall mean the income tax regulations
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promulgated under the Code applicable to the taxable year in question.
(a) Other defined terms shall have the meanings assigned to them in the
preamble to
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this Agreement. Any term that is not defined in this Agreement shall,
unless the context otherwise requires, have the meaning assigned in the
Code or the Treasury Regulations. References to provisions of the Code or
Treasury Regulations shall include a reference to any successor provision.
2. Filing of Federal Income Tax Returns.
(a) For Pre-Distribution Years of an Affiliated Subsidiary Group,
Cabletron shall file, and shall make all determinations with respect to,
all consolidated Federal Income Tax Returns required to be filed by it on
behalf of the Cabletron Affiliated Group for such year (collectively, the
"Pre-Distribution Group Returns").
(b) The Pre-Distribution Group Returns with respect to an Affiliated
Subsidiary Group shall include all of the income, gain, loss, deductions,
credits and similar items of all Members of the Cabletron Affiliated Group,
including all income, gain, loss, deductions, credits and similar items of
such Affiliated Subsidiary Group through its Distribution Date. Cabletron
shall prepare such Pre-Distribution Group Returns and shall have the right
to exercise all the powers of, and shall have all the duties of, a common
parent or agent as are conferred upon it by the Code and Treasury
Regulations with respect to such Pre-Distribution Group Returns and each
Pre-Distribution Year of such Affiliated Subsidiary Group. All Members of
the Cabletron Affiliated Group for a Pre-Distribution Year of such
Affiliated Subsidiary Group shall execute and file such consents, elections
and other documents as may be necessary or appropriate for the proper
filing of the Pre-Distribution Group Returns.
(c) For all periods beginning before the Distribution Date of an
Affiliated Subsidiary Group, each member of such Affiliated Subsidiary
Group (or its Subsidiary Group Parent on its behalf) shall file all of its
Federal Income Tax Returns not filed on a consolidated basis by Cabletron
under paragraph (a) above (the "Separate Returns"), and shall include on
the Separate Returns all of its income, gains, loss, deductions, credits
and similar items for all periods covered by the Separate Returns.
3. Payment of Federal Income Tax.
(a) Cabletron shall pay all Federal Income Tax shown as due on the Pre-
Distribution Group Returns. Each Affiliated Subsidiary Group shall upon
ten (10) days' notice reimburse or otherwise account to Cabletron for an
amount equal to its Separate Return Tax Liability. If an Affiliated
Subsidiary Group has not reimbursed or otherwise accounted to Cabletron
within ten (10) days upon receipt of a written request, interest, at the
current short-term market rate, shall accrue on the amount of such
Affiliated Subsidiary Group's Separate Return Tax Liability until the date
that payment (including accrued interest thereon) is received (or otherwise
accounted for) by the
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Cabletron Group.
(b) Within ninety (90) days of the filing of the Pre-Distribution Group
Returns, Cabletron shall be required to make or otherwise account to each
Subsidiary Group Parent of each Affiliated Subsidiary Group any payments
required as a result of benefits realized by Cabletron (or a Member of the
Cabletron Affiliated Group not included in such Affiliated Subsidiary
Group) from the use of the Affiliated Subsidiary Groups' Federal Income Tax
attributes, calculated by Cabletron in its sole discretion in accordance
with the principles regarding the determination of Separate Return Tax
Liability.
(c) Cabletron shall be entitled to receive any overpayment of Federal
Income Tax shown on any Pre-Distribution Group Return, as originally filed.
(d) Each member of an Affiliated Subsidiary Group (or its Subsidiary Group
Parent on its behalf) shall pay all Federal Income Tax shown as due on its
Separate Returns.
4. Adjustments to Federal Income Tax Liabilities.
(a) Cabletron shall be responsible for, and control all decisions as to,
Federal Income Tax audits of, and proceedings regarding the Pre-
Distribution Group Returns and other Federal Income Tax Returns filed by
it. The Subsidiary Group Parent of each Affiliated Subsidiary Group shall
be responsible for, and control all decisions as to, Federal Income Tax
audits of, and proceedings regarding the Separate Returns of the members of
its Affiliated Subsidiary Group.
(b) Subject to paragraph (e) of this Section 4 and Section 7 below, if the
Federal Income Tax liability on any Pre-Distribution Group Return which
Cabletron files is adjusted, whether by means of an amended Return, claim
for refund, or after a Federal Income Tax audit, Cabletron shall pay all
additional Federal Income Tax due and shall be entitled to receive all
refunds of Federal Income Tax except:
1. Subject to, and to the extent provided in, Section 8, each
Subsidiary Group Parent shall be entitled to refunds of
Federal Income Tax of members of its Affiliated Subsidiary
Group for Pre-Distribution Years attributable to carrybacks
originating in years beginning after its Distribution Date;
2. The Subsidiary Group Parent of an Affiliated Subsidiary
Group shall within ten (10) days' notice reimburse or
otherwise account to the Cabletron Group for the additional
Separate Return Tax
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Liability of its members with respect to its Pre-
Distribution Group Returns (and, if such Subsidiary Group
Parent has not reimbursed or otherwise accounted to the
Cabletron Group within such period, interest, at the current
short-term market rate, accrued thereon until the date of
full payment).
(c) If the Federal Income Tax liability with respect to the Separate
Return of a Member is adjusted, whether by means of an amended Return,
claim for refund, or after a Federal Income Tax audit, the Member (or its
Subsidiary Group Parent on its behalf) shall pay all additional Federal
Income Tax due and shall be entitled to receive all refunds of Federal
Income Tax.
(d) Each party responsible for an audit or proceeding under paragraph (a)
shall keep the other currently informed as to the status of any Federal
Income Tax audit or proceeding as to which the other party may be required
to make a payment (or otherwise account) to the responsible party under
this Section 4 and shall provide the other party with copies of any
correspondence or other written materials which the responsible party
either receives or provides to the Internal Revenue Service concerning such
a Federal Income Tax audit or proceeding. The party which may be required
to make a payment under this Section 4 shall have the right to participate
at its expense in any such Federal Income Tax audit or proceeding, but this
right shall not derogate from the responsible party's power to control all
decisions as to the Federal Income Tax audit or proceeding as provided in
paragraph (a).
(e) If the Federal Income Tax liability of Cabletron or the Cabletron
Affiliated Group for any Pre-Contribution Year is adjusted, whether by
means of an amended Return, claim for refund, or after a Tax audit,
Cabletron shall pay all additional Federal Income Tax due and shall be
entitled to receive all refunds of Federal Income Tax. Each Affiliated
Subsidiary Group shall be responsible for and shall promptly reimburse or
otherwise account to Cabletron, upon the request of Cabletron, an amount
equal to its share of Federal Income Tax, if any, attributable to its
Contributed Business using principles consistent with the calculation of
its Separate Return Tax Liability (applied on a divisional basis to the
extent such Contributed Business was not separately incorporated in the
Pre-Contribution Year), as determined by Cabletron in its sole discretion.
5. Other Income Tax.
With respect to Other Income Tax, Cabletron and the Affiliated
Subsidiary Groups (as modified to be consistent with the law of the
relevant jurisdiction) shall (i) file, or cause to be filed, all Other
Income Tax Returns, and (ii) pay, cause to be paid or otherwise account for
all Other Income Tax (including adjustments thereof) in
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accordance with the principles applicable to Federal Income Tax as set
forth in Sections 2, 3 and 4, as determined by Cabletron in its sole
discretion.
6. Other Tax.
For Pre-Distribution Years, each member of each Affiliated Subsidiary
Group shall (i) withhold or collect all Other Tax due from it or in respect
of its Contributed Business, (ii) file, or cause to be filed, all Returns
pertaining to such Other Tax, (iii) pay, cause to be paid or otherwise
account for such Other Tax to the relevant taxing authorities, and (iv)
retain the right to refunds of such Other Tax.
7. Tax Related Indemnities.
(a) Each member of an Affiliated Subsidiary Group shall indemnify and hold
harmless the Cabletron Group and the other Affiliated Subsidiary Groups
against any and all Taxes for which it or any member of its Affiliated
Subsidiary Group is responsible under this Agreement. Subject to the
foregoing, Cabletron shall indemnify and hold the Affiliated Subsidiary
Groups harmless against any and all Taxes the Cabletron Group is required
to bear under this Agreement, including, without limitation, any liability
under section 1.1502-6 of the Treasury Regulations.
(b) If (i) for any reason a member of an Affiliated Subsidiary Group or a
shareholder of such member is solely responsible for the Distribution of
the Subsidiary Group Parent of the Affiliated Subsidiary Group to fail to
qualify under section 355 of the Code, or (ii) the stock of such Subsidiary
Group Parent is acquired by one or more persons, whether directly or
indirectly, such that section 355(e) of the Code causes such stock of such
Subsidiary Group Parent not to be treated as "qualified property" for
purposes of section 355(c)(2) of the Code, such Affiliated Subsidiary Group
shall be responsible for and each member of such Affiliated Subsidiary
Group shall indemnify the Cabletron Group and each other Affiliated
Subsidiary Group against all Spin Damages relating to such Distribution.
(c) If the Distribution of a Subsidiary Group Parent fails to qualify
under section 355 of the Code and if such failure is the responsibility of
or is by reason of both the Cabletron Group and either a member of the
Affiliated Subsidiary Group of such Subsidiary Group Parent or a
shareholder of such member then (I) such Affiliated Subsidiary Group shall
be responsible for and each member of such Affiliated Subsidiary Group
shall indemnify the Cabletron Group and each other Affiliated Subsidiary
Group against a percentage of the Spin Damages relating to such
Distribution equal to the quotient of (x) such Affiliated Subsidiary
Group's Market
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Valuation, divided by (y) the sum of (i) such Affiliated Subsidiary Group's
Market Valuation, and (ii) Cabletron's Market Valuation, and (II) Cabletron
shall be responsible for and indemnify each Affiliated Subsidiary Group
against a percentage of the Spin Damages relating to such Distribution
equal to the quotient of (x) Cabletron's Market Valuation, divided by (y)
the sum of (i) such Affiliated Subsidiary Group's Market Valuation, and
(ii) Cabletron's Market Valuation.
(d) If (i) for any reason Cabletron is solely responsible for the
Distribution of a Subsidiary Group Parent to fail to qualify under section
355 of the Code, or (ii) the stock of Cabletron is acquired by one or more
persons, whether directly or indirectly, such that section 355(e) of the
Code causes the stock of such Subsidiary Group Parent not to be treated as
"qualified property" for purposes of section 355(c)(2) of the Code,
Cabletron shall be responsible for and indemnify each Affiliated Subsidiary
Group against all Spin Damages relating to such Distribution.
8. Carrybacks.
If a member of an Affiliated Subsidiary Group incurs a net operating
loss in a year which begins after the Distribution Date of the stock of the
Subsidiary Group Parent of such Affiliated Subsidiary Group, all members of
such Affiliated Subsidiary Group shall elect under section 172(b)(3) of the
Code to relinquish the carryback of the net operating loss to any Pre-
Distribution Taxable Year unless Cabletron consents in writing to such
carryback. If Cabletron consents to such a carryback or if a member of
such Affiliated Subsidiary Group incurs in such a year a net capital loss,
unused general business tax credit, unused foreign tax credit or any other
item that is carried back to a Pre-Distribution Taxable Year, Cabletron
shall pay such member or such Subsidiary Group Parent an amount equal to
the Tax refund received by Cabletron as a direct result of the carryback.
Cabletron shall cooperate fully in obtaining such a refund, but any out-of-
pocket expenses incurred by Cabletron in connection with such efforts shall
be borne by such member or such Subsidiary Group Parent. In the event a
subsequent audit or proceeding increases or reduces the carryback,
Cabletron shall promptly pay such member or such Subsidiary Group Parent
the amount of any additional Tax refund received by Cabletron resulting
from such an increase and such member or such Subsidiary Group Parent shall
promptly pay (or otherwise account to) Cabletron the amount of any
deficiency in Tax assessed against Cabletron.
9. Mutual Cooperation.
(a) Each member of the Cabletron Group and each Affiliated Subsidiary
Group shall provide each other with such assistance as may be reasonably
requested by either of them in connection with the preparation and
execution of any Tax Return, any audit or other examination by any taxing
authority, or any judicial or administrative
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proceedings relating to any Tax liability, and each will, upon the request
of the other, provide the other with any records or information which may
be relevant to such Return, audit or examination proceedings. Subject to
the other provisions of this Agreement, each member of the Cabletron Group
and each member of each Affiliated Subsidiary Group agree to take whatever
reasonable action is necessary to minimize their aggregate Tax liabilities.
(b) Each party will retain all Tax Returns, schedules and work papers, and
all material records and other documents relating thereto, until the later
of (i) the time the applicable statutes of limitations for assessment of
Tax for the year has expired, and (ii) the time a final settlement of all
payments which may be required under this Agreement is made for the year.
Prior to destroying any such Returns, schedules, work papers, records and
other documents, the party holding them shall offer to make copies of
relevant materials available to the other party at the expense of the other
party.
10. Notices.
All notices, requests, demands and other communications to any party
hereunder shall be duly given, made or served, if in writing and delivered
personally or sent by registered mail, postage prepaid to the address set
forth below or such other address as either party shall give written notice
to the other:
If to the Cabletron Group:
Cabletron Systems, Inc.
00 Xxxxxxxxxx Xxx
Xxxxxxxx 00
Xxxxxxxxx, XX 00000
Attn: Xxxx Xxxxxx and Chief Financial Officer
Telecopier No.: (000) 000-0000
with a copy to:
Ropes & Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attn: Xxxxx X. Fine
Telecopier No.: (000) 000-0000
If to the Aprisma Group:
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Aprisma Management Technologies, Inc.
000 Xxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attn: President
Telecopier No.: (000) 000-0000
with a copy to:
Ropes & Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attn: Xxxxx X. Fine
Telecopier No.: (000) 000-0000
If to the GNTS Group:
GlobalNetwork Technology Services, Inc.
00 Xxxxxxxxxx Xxx
Xxxxxxxx 00
Xxxxxxxxx, XX 00000
Attn: President
Telecopier No.: (000) 000-0000
with a copy to:
Ropes & Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attn: Xxxxx X. Fine
Telecopier No.: (000) 000-0000
If to the Riverstone Group:
Riverstone Networks, Inc.
0000 Xxxxx Xxxxxxxx Xxxxxxx
Xxxxx Xxxxx, XX
Attn: President
Telecopier No.: (000) 000-0000
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with a copy to:
Ropes & Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attn: Xxxxx X. Fine
Telecopier No.: (000) 000-0000
If to the Enterasys Group:
Enterasys Networks, Inc.
00 Xxxxxxxxxx Xxx
Xxxxxxxx 00
Xxxxxxxxx, XX 00000
Attn: President
Telecopier No.: (000) 000-0000
with a copy to:
Ropes & Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attn: Xxxxx X. Fine
Telecopier No.: (000) 000-0000
11. Miscellaneous.
(a) Injunctions. The parties acknowledge that irreparable damage
would occur in the event that any of the provisions of this Agreement
were not performed in accordance with its specific terms or were
otherwise breached. The parties hereto shall be entitled to an
injunction or injunctions to prevent breaches of the provisions of
this Agreement and to enforce specifically the terms and provisions
hereof in any court having jurisdiction, such remedy being in addition
to any other remedy to which they may be entitled at law or in equity.
(b) Assignment. Except by operation of law or in connection with the
sale of all or substantially all the assets of a party hereto, this
Agreement shall not be assignable, in whole or in part, directly or
indirectly, by any party hereto without the written consent of the
other party; and any attempt to assign any rights or obligations
arising under this Agreement without such consent shall be void;
provided, however, that the provisions of this Agreement shall be
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binding
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upon, inure to the benefit of and be enforceable by the parties hereto
and their respective successors and permitted assigns, but no
assignment shall relieve any party's obligations hereunder without the
written consent of the other party.
(c) Further Assurances. Subject to the provisions hereof, the parties
hereto shall make, execute, acknowledge and deliver such other
instruments and documents, and take all such other actions, as may be
reasonably required in order to effectuate the purposes of this
Agreement and to consummate the transactions contemplated hereby.
Subject to the provisions hereof, each of the parties shall, in
connection with entering into this Agreement, performing its
obligations hereunder and taking any and all actions relating hereto,
comply with all applicable laws, regulations, orders and decrees,
obtain all required consents and approvals and make all required
filings with any governmental agency, other regulatory or
administrative agency, commission or similar authority and promptly
provide the other parties with all such information as they may
reasonably request in order to be able to comply with the provisions
of this paragraph.
(d) Parties in Interest. Except as herein otherwise specifically
provided, nothing in this Agreement expressed or implied is intended
to confer any right or benefit upon any person, firm or corporation
other than the parties and their respective successors and permitted
assigns.
(e) Waivers, Etc. No failure or delay on the part of the parties in
exercising any power or right hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a
right or power, preclude any other or further exercise thereof or the
exercise of any other right or power. No modification or waiver of
any provision of this Agreement nor consent to any departure by the
parties therefrom shall in any event be effective unless the same
shall be in writing, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which
given.
(f) Setoff. All payments to be made by any party under this Agreement
shall, except to the extent otherwise specifically provided herein, be
made without setoff, counterclaim or withholding, all of which are
expressly waived.
(g) Prior Tax-Sharing Agreements; Effect on Earnings and Profits
Election. This Agreement constitutes the entire agreement between the
parties and shall supersede any other Tax-sharing or Tax-allocation
agreement or arrangement in effect between the parties hereto prior to
the Effective Date with respect to the matters expressly dealt with
herein. Nothing in this Agreement is intended to
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change or otherwise affect any election made by the Cabletron
Affiliated Group with respect to the calculation of earnings and
profits under section 1552 of the Code or the Treasury Regulations.
(h) Amendment. This Agreement may not be altered, changed, modified,
or terminated orally, and any modification or revision of this
Agreement shall be accomplished only through a writing clearly
denominated as an amendment to this Agreement signed by the Subsidiary
Group Parents, except as provided under section 10 of the
Transformation Agreement.
(i) Confidentiality. Subject to any contrary requirement of law or
regulation and the right of each party to enforce its rights hereunder
in any legal action, each party agrees that it shall keep strictly
confidential, and shall cause its employees and agents to keep
strictly confidential, any information which it or any of its agents
or employees may receive pursuant to, or in the course of performing
its obligations under, any provision of this Agreement; provided,
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however, that such obligation to maintain confidentiality shall not
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apply to information which at the time of disclosure was in the public
domain not as a result of acts by the receiving party.
(j) Dispute Resolution. If a dispute, controversy or claim arises
between or among two or more parties relating to the interpretation or
performance of this Agreement (a "Dispute"), the appropriate senior
executives of each party who shall have the authority to resolve the
matter shall meet within fifteen (15) days from the date the Dispute
arises to attempt in good faith to negotiate a resolution of the
Dispute prior to pursuing other available remedies. The earlier of
fifteen (15) days from the date one party notifies the other party or
parties of the Dispute and the date of the initial meeting between the
appropriate senior executives shall be referred to herein as the
"Dispute Resolution Commencement Date". Discussions and
correspondence relating to trying to resolve such Dispute shall be
treated as confidential information developed for the purpose of
settlement and shall be exempt from discovery or production and shall
not be admissible. If the senior executives are unable to resolve the
Dispute within fifteen (15) days from the Dispute Resolution
Commencement Date, and either party wishes to pursue its rights
relating to such Dispute, then, whether or not Cabletron is involved
in the Dispute, the parties shall submit the Dispute to the chief
executive officer of Cabletron (or such other executive of Cabletron
designated by the chief executive officer of Cabletron for this
purpose) for resolution. The chief executive officer (or other
designated executive of Cabletron) shall resolve such Dispute. The
decision of the chief executive officer or other designated executive
of Cabletron shall be final and
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binding on the parties hereto.
Notwithstanding the foregoing paragraph, if the senior executives of
each party are unable to resolve a Dispute within sixty (60) days from
the Dispute Resolution Commencement Date and at least one party to the
Dispute is no longer a Member of the Cabletron Affiliated Group, and
any party wishes to pursue its rights relating to such Dispute (as
evidenced by the approval of the Board of Directors of such party to
pursue arbitration of the Dispute in accordance with this Section
11(j)), then the Dispute shall be resolved as set forth below:
(i) The Dispute shall be submitted to final and binding
arbitration under the then current Commercial Arbitration Rules
of the American Arbitration Association ("AAA"), by three (3)
arbitrators in Boston, Massachusetts. Such arbitrators shall be
selected by the mutual agreement of the parties or, failing such
agreement, shall be selected according to the aforesaid AAA
rules. The arbitrators will be instructed to prepare and deliver
a written, reasoned opinion stating their decision within thirty
(30) days of the completion of the arbitration. The prevailing
party in such arbitration, as determined by the arbitrator, shall
be entitled to expenses, including costs and reasonable
attorneys' and other professional fees, incurred in connection
with the arbitration (but excluding any costs and fees associated
with prior negotiation or mediation). The decision of the
arbitrator shall be final and non-appealeable and may be enforced
in any court of competent jurisdiction.
(ii) Notwithstanding the foregoing paragraph, any Dispute
involving at least one party that is no longer a Member is not
required to be negotiated or arbitrated prior to seeking
injunctive relief from a court of competent jurisdiction to
prevent serious and irreparable injury to one of the parties or
to others: breach of any obligation of confidentiality;
infringement, misappropriation, or misuse of any intellectual
property right; or any other claim where interim relief from the
court is sought to prevent serious and irreparable injury to one
of the parties or to others. However, the parties to the
Dispute shall make a good faith effort to negotiate such Dispute,
according to the above procedures, while such court action is
pending.
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(k) Headings. Descriptive headings are for convenience only and shall
not control or affect the meaning or construction of any provision of
this Agreement.
(l) Governing Law. This Agreement is intended to take effect as a
sealed instrument governed by the laws of State of Delaware (without
giving effect to any choice or conflict of law provision or rule that
would cause the application of the laws of any other jurisdiction).
[The remainder of this page is intentionally left blank.]
-15-
IN WITNESS HEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective officers, each of whom is duly authorized, all as
of the day and year first above written.
Cabletron Systems, Inc., on behalf of itself and
the Cabletron Group
By: /s/ Xxxxxx Xxxxx
--------------------------
Title: President, Chairman & CEO
Aprisma Management Technologies, Inc., on
behalf of itself and the Aprisma Group
By: __________________________
Title:
GlobalNetwork Technology Services, Inc., on
behalf of itself and the GNTS Group
By: __________________________
Title:
Riverstone Networks, Inc., on behalf of itself and
the Riverstone Group
By: __________________________
Title:
Enterasys Networks, Inc., on behalf of itself and
the Enterasys Group
By: __________________________
Title:
IN WITNESS HEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective officers, each of whom is duly authorized, all as
of the day and year first above written.
Cabletron Systems, Inc., on behalf of itself and
the Cabletron Group
By:
__________________________
Title:
Aprisma Management Technologies, Inc., on
behalf of itself and the Aprisma Group
By: /s/ Xxxxxxx Xxxxxxx
--------------------------
Title: President
GlobalNetwork Technology Services, Inc., on
behalf of itself and the GNTS Group
By: __________________________
Title:
Riverstone Networks, Inc., on behalf of itself and
the Riverstone Group
By: __________________________
Title:
Enterasys Networks, Inc., on behalf of itself and
the Enterasys Group
By: __________________________
Title:
IN WITNESS HEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective officers, each of whom is duly authorized, all as
of the day and year first above written.
Cabletron Systems, Inc., on behalf of itself and
the Cabletron Group
By:
__________________________
Title:
Aprisma Management Technologies, Inc., on
behalf of itself and the Aprisma Group
By:
__________________________
Title:
GlobalNetwork Technology Services, Inc., on
behalf of itself and the GNTS Group
By: /s/ Xxxxx Xxxxxxxxx
--------------------------
Title: President
Riverstone Networks, Inc., on behalf of itself and
the Riverstone Group
By: __________________________
Title:
Enterasys Networks, Inc., on behalf of itself and
the Enterasys Group
By: __________________________
Title:
IN WITNESS HEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective officers, each of whom is duly authorized, all as
of the day and year first above written.
Cabletron Systems, Inc., on behalf of itself and
the Cabletron Group
By:
__________________________
Title:
Aprisma Management Technologies, Inc., on
behalf of itself and the Aprisma Group
By:
__________________________
Title:
GlobalNetwork Technology Services, Inc., on
behalf of itself and the GNTS Group
By: __________________________
Title:
Riverstone Networks, Inc., on behalf of itself and
the Riverstone Group
By: /s/ Xxxxxxx Xxxxxxx
--------------------------
Title: President & CEO
Enterasys Networks, Inc., on behalf of itself and
the Enterasys Group
By: __________________________
Title:
IN WITNESS HEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective officers, each of whom is duly authorized, all as
of the day and year first above written.
Cabletron Systems, Inc., on behalf of itself and
the Cabletron Group
By:
__________________________
Title:
Aprisma Management Technologies, Inc., on
behalf of itself and the Aprisma Group
By:
__________________________
Title:
GlobalNetwork Technology Services, Inc., on
behalf of itself and the GNTS Group
By: __________________________
Title:
Riverstone Networks, Inc., on behalf of itself and
the Riverstone Group
By: __________________________
Title:
Enterasys Networks, Inc., on behalf of itself and
the Enterasys Group
By: /s/ Xxxxxxx Xxxxxx
--------------------------
Title: President
