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EXHIBIT 10.3
DRAFT
GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT
BETWEEN
C-CUBE MICROSYSTEMS INC.
AND
C-CUBE SEMICONDUCTOR INC.
__________ ____, 2000
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TABLE OF CONTENTS
PAGE
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ARTICLE I CONTRIBUTION AND ASSUMPTION.............................................1
Section 1.1 Contribution of Assets and Assumption of Liabilities....1
Section 1.2 Semiconductor Assets....................................2
Section 1.3 Semiconductor Liabilities...............................4
Section 1.4 Methods of Transfer and Assumption......................6
Section 1.5 Governmental Approvals and Consents.....................8
Section 1.6 Nonrecurring Costs and Expenses.........................8
Section 1.7 Novation of Assumed Semiconductor Liabilities...........9
ARTICLE II [INTELLECTUAL PROPERTY LICENSES........................................9
Section 2.1 License to C-Cube.......................................9
Section 2.2 License to Semiconductor...............................10
Section 2.3 Transfers and Sublicense...............................10
ARTICLE III LITIGATION...........................................................10
Section 3.1 Allocation.............................................10
Section 3.2 Cooperation............................................11
ARTICLE IV MISCELLANEOUS.........................................................11
Section 4.1 Entire Agreement.......................................11
Section 4.2 Governing Law..........................................12
Section 4.3 Notices................................................12
Section 4.4 Parties in Interest....................................12
Section 4.5 Counterparts...........................................12
Section 4.6 Assignment.............................................12
Section 4.7 Severability...........................................12
Section 4.8 Failure or Indulgence Not Waiver; Remedies Cumulative..12
Section 4.9 Amendment..............................................13
Section 4.10 Authority..............................................13
Section 4.11 Interpretation.........................................13
Section 4.12 Conflicting Agreements.................................13
ARTICLE V DEFINITIONS............................................................13
Section 5.1 Action.................................................13
Section 5.2 Affiliated Company.....................................13
Section 5.3 Ancillary Agreement....................................13
Section 5.4 Assets.................................................13
Section 5.5 C-Cube Group...........................................15
Section 5.6 Consents...............................................15
Section 5.7 Contracts..............................................15
Section 5.8 Distribution...........................................15
Section 5.9 DiviCom Business.......................................15
Section 5.10 Distribution Date......................................15
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TABLE OF CONTENTS
(CONTINUED)
PAGE
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Section 5.11 Environmental Actions..................................15
Section 5.12 Excluded Assets........................................15
Section 5.13 Excluded Liabilities...................................15
Section 5.14 Governmental Approvals.................................16
Section 5.15 Governmental Authority.................................16
Section 5.16 Indemnification and Insurance Matters Agreement........16
Section 5.17 Insurance Policies.....................................16
Section 5.18 Insured Semiconductor Liability........................16
Section 5.19 Intellectual Property..................................16
Section 5.20 Liabilities............................................16
Section 5.21 Litigation Disclosure Letter...........................16
Section 5.22 Person.................................................16
Section 5.23 Retained Cash..........................................17
Section 5.24 Retained Payables......................................17
Section 5.25 Retained Receivables...................................17
Section 5.26 Security Interest......................................17
Section 5.27 Semiconductor Assets...................................17
Section 5.28 Semiconductor Balance Sheet............................17
Section 5.29 Semiconductor Business.................................17
Section 5.30 Semiconductor Contingent Gain..........................17
Section 5.31 Semiconductor Contingent Liability.....................17
Section 5.32 Semiconductor Contracts................................18
Section 5.33 Semiconductor Group....................................18
Section 5.34 Semiconductor Intellectual Property....................18
Section 5.35 Semiconductor Liabilities..............................18
Section 5.36 Semiconductor Pro Forma Balance Sheet..................18
Section 5.37 Separation.............................................18
Section 5.38 Separation Agreement...................................19
Section 5.39 Separation Date........................................19
Section 5.40 Subsidiary.............................................19
Section 5.41 Taxes..................................................19
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SCHEDULES
[Schedule 1.2(a)(xi) Certain Semiconductor Intellectual Property
Schedule 1.2(a)(xii) Specific Semiconductor Assets to be Transferred
Schedule 1.2(b)(i) Excluded Assets
Schedule 1.3(a)(vi) Divested Businesses Which Contain Liabilities to be
Transferred to Semiconductor
Schedule 1.3(a)(vii) Specific Semiconductor Liabilities
Schedule 1.3(b)(i) Excluded Liabilities]
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GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT
This General Assignment and Assumption Agreement (this "AGREEMENT") is
entered into on _______ ___, 2000 between C-Cube Microsystems Inc., a Delaware
corporation ("C-CUBE"), and C-Cube Semiconductor Inc., a Delaware corporation
("SEMICONDUCTOR"). Capitalized terms used herein and not otherwise defined
herein shall have the meanings ascribed to such terms in ARTICLE IV hereof.
RECITALS
WHEREAS, C-Cube hereby and by certain other instruments of even date
herewith transfers or will transfer to Semiconductor effective as of the
Separation Date, substantially all of the business and assets of the
Semiconductor Business owned by C-Cube in accordance with the Master Separation
and Distribution Agreement dated as of _______ ___, 2000 between the parties
(the "SEPARATION AGREEMENT"). It is the intent of the parties hereto, by this
Agreement and the other agreements and instruments provided for in the
Separation Agreement, that C-Cube and its Subsidiaries convey to Semiconductor
and its Subsidiaries substantially all of the business and assets of the
Semiconductor Business;
WHEREAS, it is further intended between the parties that Semiconductor
assume certain of the liabilities related to the Semiconductor Business, as
provided in this Agreement, the Separation Agreement or the other agreements and
instruments provided for in the Separation Agreement;
WHEREAS, C-Cube has entered into the Agreement and Plan of Merger and
Reorganization, dated as of October 27, 1999 (the "MERGER AGREEMENT"), with
Harmonic Inc. ("HARMONIC") pursuant to which, subsequent to the sale or
distribution of C-Cube of Semiconductor, C-Cube will merge with and into
Harmonic (the "MERGER");
WHEREAS, C-Cube and Harmonic entered into an Amended and Restated Agreement
and Plan of Merger and Reorganization dated as of December 9, 1999 (the
"Restated Merger Agreement");
NOW, THEREFORE, in consideration of the foregoing and the covenants and
agreements set forth below, the parties hereto agree as follows:
ARTICLE I
CONTRIBUTION AND ASSUMPTION
SECTION 1.1 CONTRIBUTION OF ASSETS AND ASSUMPTION OF LIABILITIES.
(a) Transfer of Assets. Effective on the Separation Date, C-Cube hereby
assigns, transfers, conveys and delivers to Semiconductor, and agrees to cause
its applicable Subsidiaries to assign, transfer, convey and deliver to
Semiconductor's applicable Subsidiaries, and Semiconductor hereby accepts from
C-Cube, and agrees to cause its applicable Subsidiaries to accept from C-Cube's
applicable Subsidiaries, all of C-Cube's and its applicable Subsidiaries'
respective right, title and interest in all Semiconductor Assets; provided,
however, that any Semiconductor Assets that are
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specifically assigned or transferred pursuant to another Ancillary Agreement
shall not be assigned or transferred pursuant to this SECTION 1.1(a).
(b) Assumption of Liabilities. Effective on the Separation Date,
Semiconductor hereby assumes and agrees faithfully to perform and fulfill, all
the Semiconductor Liabilities held by C-Cube in accordance with their respective
terms, and agrees to cause its applicable Subsidiaries to assume, perform and
fulfill all the Semiconductor Liabilities held by its Subsidiaries, in
accordance with their respective terms.
(c) Misallocated Assets and Liabilities. In the event that at any time or
from time to time (whether prior to, on or after the Separation Date), any party
hereto (or any member of such party's respective Group), shall receive or
otherwise possess any Asset or Liability that is allocated to any other Person
pursuant to this Agreement or any Ancillary Agreement, such party shall promptly
transfer, or cause to be transferred, such Asset or Liability to the Person so
entitled thereto. Prior to any such transfer, the Person receiving or possessing
such Asset shall hold such Asset or Liability in trust for any such other
Person.
SECTION 1.2 SEMICONDUCTOR ASSETS.
(a) Included Assets. For purposes of this Agreement, "SEMICONDUCTOR ASSETS"
shall mean (without duplication) the following Assets, except as otherwise
provided for in any Ancillary Agreement or other express agreement of the
parties:
(i) all assets reflected in the unaudited consolidated balance sheet
(including notes thereto) of the Semiconductor Business as of September 30, 1999
attached hereto as Annex 1.2(a) (the "BALANCE SHEET"), subject to any
dispositions of such Assets subsequent to the date of such Balance Sheet;
(ii) all assets that have been written off, expensed or fully
depreciated that, had they not been written off, expensed or fully depreciated,
would have been reflected in the Balance Sheet in accordance with the principles
and accounting policies under which the Balance Sheet was prepared;
(iii) all assets acquired by C-Cube or its Subsidiaries after the date
of the Balance Sheet that would be reflected in the consolidated balance sheet
of the Semiconductor Business as of the Separation Date if such consolidated
balance sheet was prepared at the time of the Semi Disposition using the same
principles and accounting policies under which the Balance Sheet was prepared;
(iv) all assets that are used primarily by the Semiconductor Business
at the Separation Date but are not reflected in the Balance Sheet due to mistake
or unintentional omission;
(v) all claims or other rights of C-Cube or the Semiconductor Business
that primarily relate to the Semiconductor Business, whenever arising, against
any person or entity other than an officer, employee, director or consultant of
the Semiconductor Business, if and to the extent that (i) such claim or right
arises out of the events, acts or omissions occurring on or before the
Separation Date (based on then existing law) and (ii) the existence or scope of
the obligation of such other person or entity as of the Separation Date was not
acknowledged, fixed or determined in any
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material respect, due to a dispute or other uncertainty as of the Separation
Date or as a result of the failure of such claim or other right to have been
discovered or asserted as of the Separation Date. A claim or right meeting the
foregoing definition shall be considered an "SEMICONDUCTOR CONTINGENT GAIN"
regardless of whether there was any action pending, threatened or contemplated
as of the Separation Date with respect thereto. In the case of any claim or
right, a portion of which arises out of events, acts or omissions occurring
prior to the Separation Date and a portion of which arises out of events, acts
or omissions occurring on or after the Separation Date, only that portion that
arises out of events, acts or omissions occurring prior to the Separation Date,
shall be considered a Semiconductor Contingent Gain. For purposes of the
foregoing a claim or right shall be deemed to have accrued as of the Separation
Date if all the elements of the claim necessary for its assertion shall have
occurred on or prior to the Separation Date, would not be dismissed by a court
on ripeness or similar grounds. Notwithstanding the foregoing, none of (i) any
insurance proceeds, (ii) any Excluded Assets (as defined below), (iii) any
reversal of any litigation or other reserve, or (iv) any matters relating to
Taxes which are governed by the Tax Sharing Agreement shall be deemed to be a
Semiconductor Contingent Gain;
(vi) all contracts in which C-Cube is a party or by which it or any of
its assets is bound whether or not in writing, except for any such contract or
agreement that is contemplated to be retained by C-Cube because it relates
primarily to the DiviCom Business including:
(1) all prepaid expenses, trade accounts and other accounts and
notes receivables;
(2) all rights under contracts or agreement, all claims or rights
against any person or entity arising from the ownership of any Asset, all rights
in connection with any bids or offers and all claims, choices in action or
similar rights, whether accrued or contingent;
(3) all rights under insurance policies and rights in the nature
of insurance, indemnification or contribution;
(4) all licenses, permits, approvals and authorization which have
been issued by any governmental authority; and
(5) interest rate, currency, commodity or other swap, collar, cap
or other hedging or similar agreements or arrangements.
(vii) all computers, desks, equipment (including equipment used for
research and development) and other Assets used primarily by employees of C-Cube
that will become employees of the Semiconductor Business;
(viii) to the extent permitted by law and subject to any agreement
regarding indemnification and/or insurance matters, all rights of the
Semiconductor Business under any of C-Cube's insurance policies;
(ix) all (a) accounts receivable and other rights to payment for goods
or services sold, leased or otherwise provided in the conduct of the
Semiconductor Business that, as of the Separation Date, are payable by a third
party to C-Cube or any of C-Cube's subsidiaries, whether past due, due or to
become due, including any interest, sales or use taxes, finance charges, late or
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returned check charges and other obligations of the accounts debtor with respect
thereto, and any proceeds of any of the foregoing and (b) other miscellaneous
Assets for which an adjustment is made in the Balance Sheet;
(x) C-Cube's rights in the trade and service marks and domain names
incorporating or based on the name C-CUBE and any goodwill associated therewith;
(xi) All Intellectual Property owned or transferable by C-Cube or the
Semiconductor Business that arises out of the activities of, or that is
primarily related to, the Semiconductor Business, including all Intellectual
Property listed on Schedule 1.2(a)(xi) (all of the foregoing, "SEMICONDUCTOR
INTELLECTUAL PROPERTY"), and all rights to xxx for, recover and retain any
damages from any third party's infringement of any such Intellectual Property
rights; and
(xii) cash or cash equivalents, bank accounts, lock boxes and other
deposit arrangements (other than the Retained Cash).
(xiii) all outstanding shares in subsidiaries conducting Semiconductor
Business owned directly by C-Cube Microsystems Inc. including shares in:
(1) C-Cube Microsystems International Ltd., a company organized
in Bermuda;
(2) C-Cube U.S. Inc., a company organized in Delaware; and
(3) C-Cube Japan Inc., a company organized in Japan and assets
owned by these subsidiaries;
(xiv) all assets in operations in Canada conducting Semiconductor
Business through C-Cube Microsystem's registered Canadian branch.
(e) Excluded Assets. For the purposes of this Agreement, "EXCLUDED ASSETS"
shall mean:
(i) [the assets listed or described on Annex 1.2(b)]; and
(ii) C-Cube Registered Intellectual Property listed on the Company
Disclosure Schedule (as defined in the Merger Agreement.)
SECTION 1.3 SEMICONDUCTOR LIABILITIES.
(f) Included Liabilities. For the purposes of this Agreement,
"SEMICONDUCTOR LIABILITIES" shall mean (without duplication) the following
Liabilities, except as otherwise provided for in any Ancillary Agreement or
other express agreement of the parties:
(i) all Liabilities reflected in the Balance Sheet, subject to any
discharge of such Liabilities subsequent to the date of the Balance Sheet;
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(ii) all Liabilities of C-Cube or its Subsidiaries that arise after
the date of the Balance Sheet that would be reflected in the consolidated
balance sheet of the Semiconductor Business as of the Separation Date if such
consolidated balance sheet was prepared using the same principles and accounting
policies under which the Balance Sheet was prepared;
(iii) all Liabilities that are related primarily to the Semiconductor
Business at the Separation Date but are not reflected in the Balance Sheet due
to mistake or unintentional omission;
(iv) any Liability of C-Cube or the Semiconductor Business that
primarily related to the Semiconductor Business, whenever arising, to any person
or entity other than an officer, director, employee or consultant of the
Semiconductor Business, if and to the extent that (i) such Liability arises out
of the events, acts or omissions occurring on or before the Separation Date and
(ii) the existence or scope of the obligation to such person or entity as of the
Separation Date with respect to such Liability was not acknowledged, fixed or
determined in any material respect, due to a dispute or other uncertainty as of
the Separation Date or as a result of the failure of such Liability to have been
discovered or asserted as of the Separation Date (it being understood that the
existence of a litigation or other reserve with respect to any Liability shall
not be sufficient for such Liability to be considered acknowledged, fixed or
determined) (each, a "SEMICONDUCTOR CONTINGENT LIABILITY"). In the case of any
Liability, a portion of which arises out of events, acts or omissions occurring
prior to the Separation Date and a portion of which arises out of events, acts
or omissions occurring on or after the Separation Date, only that portion that
arises out of events, acts or omissions occurring prior to the Separation Date
shall be considered a Semiconductor Contingent Liability. For purposes of the
foregoing, a Liability shall be deemed to have arisen out of events, acts or
omissions occurring prior to the Separation Date if all the elements necessary
for the assertion of a claim with respect to such Liability shall have occurred
on or prior to the Separation Date, such that the claim, were it asserted in an
action on or prior to the Separation Date, would not be dismissed by a court on
ripeness or similar grounds. For purposes of clarification of the foregoing, the
parties agree that no Liability relating to, arising out of or resulting from
any obligation of any person or entity to satisfy any obligation accrued under
any employee stock option plan, stock purchase plan or the like as of the
Separation Date, shall be deemed to be a Semiconductor Contingent Liability. For
purposes of determining whether a claim relating to the Year 2000 problem is a
Semiconductor Contingent Liability, claims relating to products shipped prior to
the Separation Date shall be deemed to have arisen prior to the Separation Date.
(v) all Liabilities (other than Liabilities for Taxes), whether
arising before on or after the Separation Date, primarily relating to, arising
out of or resulting from:
(1) the operation of the Semiconductor Business, as conducted at
any time prior to, on or after the Separation Date (including any Liability
relating to, arising out of or resulting from any act or failure to act by any
director, officer, employee, agent or representative (whether or not such act or
failure to act is or was within such person or entity's authority));
(2) the operation of any business conducted by the Semiconductor
Business at any time after the Separation Date (including any Liability relating
to, arising out of or resulting from any act or failure to act by any director,
officer, employee, agent or representative (whether or not such act or failure
to act is or was within such person or entity's authority)); or
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(3) any Semiconductor Assets;
(vi) all Liabilities relating to, arising out of or resulting from any
of the terminated, divested or discontinued businesses and operations listed or
described on Annex 1.3(a);
(vii) all fees and expenses of C-Cube incurred in connection with the
Merger and the spin-off transaction;
(viii) all accounts payable and other obligations of payment for goods
or services purchased, leased or otherwise received in the conduct of the
Semiconductor Business that as of the Separation Date are payable to a third
party by C-Cube or any of C-Cube's subsidiaries, whether past due, due or to
become due, including any interest, sales or use taxes, finance charges, late or
returned check charges and other obligations of C-Cube or any of C-Cube's
Subsidiaries with respect thereto, and any obligations related to any of the
foregoing;
(ix) all employee compensation Liabilities relating to employees of
the Semiconductor Business other than Continuing Employees; and
(x) all severance payments and related Liabilities arising out of any
termination of non-Continuing Employees (as defined in the Merger Agreement).
Notwithstanding anything in this Agreement, the Merger Agreement or the
Ancillary Agreements to the contrary, to the extent that the amount provided by
C-Cube to the Semiconductor Business has been reduced on account of certain
liabilities set forth in clauses (i) through (v) of the definition of "Retained
Cash," such liabilities shall not constitute Semiconductor Liabilities.
Notwithstanding the foregoing, the Semiconductor Liabilities shall not include
the Excluded Liabilities referred to in SECTION 1.3(b) below.
(b) Excluded Liabilities. For the purposes of this Agreement, "EXCLUDED
LIABILITIES" shall mean:
(i) [all Liabilities listed or described in Annex 1.3(b)];
(ii) all Liabilities to the extent that (i) it is covered under the
terms of C-Cube's insurance policies in effect prior to the Separation Date and
(ii) the Semiconductor Business is not a named, insured under, or otherwise
entitled to the benefits of, such insurance policies;
(iii) all Liabilities for Pre-Semi Disposition Taxes not attributable
to the Semiconductor Business; and
(iv) all agreements and obligations of C-Cube under the agreements
governing the Distribution.
SECTION 1.4 METHODS OF TRANSFER AND ASSUMPTION.
(a) Terms of Other Ancillary Agreements Govern. The parties shall enter
into the other Ancillary Agreements, on or about the date of this Agreement. To
the extent that the transfer of any
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Semiconductor Asset or the assumption of any Semiconductor Liability is
expressly provided for by the terms of any other Ancillary Agreement, the terms
of such other Ancillary Agreement shall effect, and determine the manner of, the
transfer or assumption. It is the intent of the parties that pursuant to
SECTIONS 1.1, 1.2 and 1.3, the transfer and assumption of all other
Semiconductor Assets and Semiconductor Liabilities shall be made effective as of
the Separation Date.
(b) Mistaken Assignments and Assumptions. In addition to those transfers
and assumptions accurately identified and designated by the parties to take
place but which the parties are not able to effect prior to the Separation Date,
there may exist (i) Assets that the parties discover were, contrary to the
agreements between the parties, by mistake or omission, transferred to
Semiconductor or retained by C-Cube or (ii) Liabilities that the parties
discover were, contrary to the agreements between the parties, by mistake or
omission, assumed by Semiconductor or not assumed by Semiconductor. The parties
shall cooperate in good faith to effect the transfer or re-transfer of such
Assets, and/or the assumption or re-assumption of such Liabilities, to or by the
appropriate party and shall not use the determination that remedial actions need
to be taken to alter the original intent of the parties hereto with respect to
the Assets to be transferred to or Liabilities to be assumed by Semiconductor.
Each party shall reimburse the other or make other financial adjustments (e.g.,
without limitation, cash reserves) or other adjustments to remedy any mistakes
or omissions relating to any of the Assets transferred hereby or any of the
Liabilities assumed hereby.
(c) Transfer of Assets and Liabilities Not Included in Semiconductor Assets
and Semiconductor Liabilities. In the event the parties discover Assets and
Liabilities that relate primarily to the Semiconductor Business but do not
constitute Semiconductor Assets under SECTION 1.2 or Semiconductor Liabilities
under SECTION 1.3, the parties shall cooperate in good faith to effect the
transfer of such Assets at book value, or the assumption of such Liabilities, to
Semiconductor or its Subsidiaries and shall not use the determination of
remedial actions contemplated in the Separation Agreement to alter the original
intent of the parties hereto with respect to the Assets to be transferred to or
Liabilities to be assumed by Semiconductor. Each party shall reimburse the other
or make other financial adjustments (e.g., without limitation, cash reserves) or
other adjustments to remedy any mistakes or omissions relating to any of the
Assets transferred hereby or any of the Liabilities assumed hereby.
(d) Documents Relating to Other Transfers of Assets and Assumption of
Liabilities. In furtherance of the assignment, transfer and conveyance of
Semiconductor Assets and the assumption of Semiconductor Liabilities set forth
in SECTIONS 1.4(a), (b) and (c) and certain Ancillary Agreements, simultaneously
with the execution and delivery hereof or as promptly as practicable thereafter,
(i) C-Cube shall execute and deliver such bills of sale, stock powers,
certificates of title, assignments of contracts and other instruments of
transfer, conveyance and assignment as and to the extent necessary to evidence
the transfer, conveyance and assignment of all of C-Cube's and its Subsidiaries'
right, title and interest in and to the Semiconductor Assets to Semiconductor
and (ii) Semiconductor shall execute and deliver, to C-Cube and its Subsidiaries
such bills of sale, stock powers, certificates of title, assumptions of
contracts and other instruments of assumption as and to the extent necessary to
evidence the valid and effective assumption of the Semiconductor Liabilities by
Semiconductor.
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SECTION 1.5 GOVERNMENTAL APPROVALS AND CONSENTS.
(a) Transfer In Violation of Laws. If and to the extent that the valid,
complete and perfected transfer assignment or novation to the Semiconductor
Group of any Semiconductor Assets and Semiconductor Liabilities (or from the
Semiconductor Group of any Non-Semiconductor Assets) would be a violation of
applicable laws or require any Consent or Governmental Approval in connection
with the Separation or the Distribution, then, unless C-Cube shall otherwise
determine, the transfer, assignment or novation to or from the Semiconductor
Group, as the case may be, of such Semiconductor Assets or Non-Semiconductor
Assets, respectively, shall be automatically deemed deferred and any such
purported transfer, assignment or novation shall be null and void until such
time as all legal impediments are removed and/or such Consents or Governmental
Approvals have been obtained. Notwithstanding the foregoing, such Asset shall
still be considered an Semiconductor Asset for purposes of determining whether
any Liability is an Semiconductor Liability; provided, however, that if such
covenants or Governmental Approvals have not been obtained within six months of
the Distribution Date, the parties will use their reasonable commercial efforts
to achieve an alternative solution in accordance with the parties' intentions.
(b Transfers Not Consummated Prior to Separation Date. If the transfer,
assignment or novation of any Assets intended to be transferred or assigned
hereunder is not consummated prior to or on the Separation Date, whether as a
result of the provisions of SECTION 1.5(a) or for any other reason, then the
Person retaining such Asset shall thereafter hold such Asset for the use and
benefit, insofar as reasonably possible, of the Person entitled thereto (at the
expense of the Person entitled thereto). In addition, the Person retaining such
Asset shall take such other actions as may be reasonably requested by the Person
to whom such Asset is to be transferred in order to place such Person, insofar
as reasonably possible, in the same position as if such Asset had been
transferred as contemplated hereby and so that all the benefits and burdens
relating to such Semiconductor Assets (or such Non-Semiconductor Assets, as the
case may be), including possession, use, risk of loss, potential for gain, and
dominion, control and command over such Assets, are to inure from and after the
Separation Date to the Semiconductor Group (or the C-Cube Group, as the case may
be). If and when the Consents and/or Governmental Approvals, the absence of
which caused the deferral of transfer of any Asset pursuant to SECTION 1.5(a),
are obtained, the transfer of the applicable Asset shall be effected in
accordance with the terms of this Agreement and/or the applicable Ancillary
Agreement.
(c) Expenses. The Person retaining an Asset due to the deferral of the
transfer of such Asset shall not be obligated, in connection with the foregoing,
to expend any money unless the necessary funds are advanced by the Person
entitled to the Asset, other than reasonable out-of-pocket expenses, attorneys'
fees and recording or similar fees, all of which shall be promptly reimbursed by
the Person entitled to such Asset.
SECTION 1.6 NONRECURRING COSTS AND EXPENSES. Notwithstanding anything
herein to the contrary, any nonrecurring costs and expenses incurred by the
parties hereto to effect the transactions contemplated hereby which are not
allocated pursuant to the terms of the Separation Agreement, this Agreement or
any other Ancillary Agreement shall be the responsibility of the party which
incurs such costs and expenses.
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SECTION 1.7 NOVATION OF ASSUMED SEMICONDUCTOR LIABILITIES.
(a) Reasonable Commercial Efforts. Each of C-Cube and Semiconductor, at the
request of the other, shall use their reasonable commercial efforts to obtain,
or to cause to be obtained, any consent, substitution, approval or amendment
required to novate (including with respect to any federal government contract)
or assign all rights and obligations under agreements, leases, licenses and
other obligations or Liabilities of any nature whatsoever that constitute
Semiconductor Liabilities or to obtain in writing the unconditional release of
all parties to such arrangements other than any member of the Semiconductor
Group, so that, in any such case, Semiconductor and its Subsidiaries will be
solely responsible for such Liabilities; provided, however, that neither C-Cube,
Semiconductor nor their Subsidiaries shall be obligated to pay any consideration
therefor to any third party from whom such consents, approvals, substitutions
and amendments are requested.
(b) Inability to Obtain Novation. If C-Cube or Semiconductor is unable to
obtain, or to cause to be obtained, any such required consent, approval,
release, substitution or amendment, the applicable member of the C-Cube Group
shall continue to be bound by such agreements, leases, licenses and other
obligations and, unless not permitted by law or the terms thereof (except to the
extent expressly set forth in this Agreement, the Separation Agreement or any
other Ancillary Agreement), Semiconductor shall, as agent or subcontractor for
C-Cube or such other Person, as the case may be, pay, perform and discharge
fully, or cause to be paid, transferred or discharged all the obligations or
other Liabilities of C-Cube or such other Person, as the case may be, thereunder
from and after the date hereof. C-Cube shall, without further consideration, pay
and remit, or cause to be paid or remitted, to Semiconductor or its appropriate
Subsidiary promptly all money, rights and other consideration received by it or
any member of its respective Group in respect of such performance (unless any
such consideration is an Excluded Asset). If and when any such consent,
approval, release, substitution or amendment shall be obtained or such
agreement, lease, license or other rights or obligations shall otherwise become
assignable or able to be novated, C-Cube shall thereafter assign, or cause to be
assigned, all its rights, obligations and other Liabilities thereunder or any
rights or obligations of any member of its respective Group to Semiconductor
without payment of further consideration and Semiconductor shall, without the
payment of any further consideration, assume such rights and obligations.
ARTICLE II
[INTELLECTUAL PROPERTY LICENSES(1)]
SECTION 2.1 LICENSE TO C-CUBE.
(a) Grant. To the extent any of the Semiconductor Intellectual Property is
necessary for, or would be infringed by, the operation of the C-Cube business as
such business is operated as of or prior to the Separation Date, subject to all
limitations set forth herein Semiconductor hereby grants to C-Cube, to the
extent of Semiconductor's rights in such Semiconductor Intellectual Property and
without any representation or warranty of any kind, a worldwide, perpetual,
irrevocable, non-
----------
(1) This Article is subject to further review by Company.
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exclusive, license to continue to operate the business of C-Cube in
substantially the same manner such business was conducted as of or prior to the
Separation Date.
(b) Limitations. All rights and licenses to the Semiconductor Intellectual
Property not expressly granted to C-Cube in Section 2.1(a) or in a written
agreement between the parties are reserved to Semiconductor. Without limiting
the foregoing, C-Cube shall not have any right or license under the foregoing
and is not granted any license hereunder to (i) make or have made any
semiconductor device, and (ii) [_________].
(c) No Technology Transfer. Nothing set forth in Section 2.1(a) shall
obligate Semiconductor to transfer or disclose to C-Cube any Intellectual
Property including any know how, software, or other materials.
SECTION 2.2 LICENSE TO SEMICONDUCTOR.
(a) Grant. To the extent any of the Excluded Assets or any other assets
retained by C-Cube include any Intellectual Property that is necessary for or
would be infringed by the operation of Semiconductor's business as such business
was conducted as of or prior to the Separation Date, subject to all limitations
set forth herein C-Cube hereby grants to Semiconductor, to the extent of
C-Cube's rights in such Intellectual Property and without any representation or
warranty of any kind, a worldwide, perpetual, irrevocable, non-exclusive license
to continue to operate the business of Semiconductor in substantially the same
manner such business was conducted as of or prior to the Separation Date.
(b) Limitations. All rights and licenses to the Intellectual Property of
C-Cube not expressly granted to Semiconductor in Section 2.2(a) or in a written
agreement between the parties are reserved to C-Cube.
(c) No Technology Transfer. Nothing set forth in Section 2.2(a) shall
obligate C-Cube transfer to or disclose to Semiconductor any Intellectual
Property including any know how, software, or other materials.
SECTION 2.3 TRANSFERS AND SUBLICENSE. The licenses granted to each party
in this ARTICLE II may neither: (i) be assigned or transferred by the licensed
party except in connection with the sale or merger of such party or the sale of
substantially all of the assets of such party, nor (ii) licensed by such
licensed party except in connection with the granting by such party of a license
of substantial other Intellectual Property of such party.]
ARTICLE III
LITIGATION
SECTION 3.1 ALLOCATION.
(a) Litigation to Be Transferred to Semiconductor. Notwithstanding any
contrary provisions in the provisions of the Indemnification and Insurance
Matters Agreement, on the Separation Date, the responsibilities for management
of the litigation identified in SECTION 3.1(a) of a litigation disclosure letter
(the "LITIGATION DISCLOSURE Letter"), which will be delivered by C-Cube to
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Semiconductor on the Separation Date, shall be transferred in their entirety
from C-Cube and its Subsidiaries to Semiconductor and its Subsidiaries. As of
the Separation Date and thereafter, Semiconductor shall manage the defense of
this litigation and shall cause its applicable Subsidiaries to do the same.
C-Cube and its Subsidiaries must first obtain the prior consent of Semiconductor
or its applicable Subsidiary for any action taken subsequent to the Separation
Date in connection with the litigation identified in the Litigation Disclosure
Letter, which consent cannot be unreasonably withheld or delayed. All other
matters relating to such litigation, including but not limited to
indemnification for such claims, shall be governed by the provisions of the
Indemnification and Insurance Matters Agreement.
(b) Litigation to be Defended by C-Cube at Semiconductor's Expense.
Notwithstanding any contrary provisions in the Indemnification and Insurance
Matters Agreement, C-Cube shall defend, and shall cause its applicable
Subsidiaries to defend, the litigation identified in SECTION 3.1(b) of the
Litigation Disclosure Letter. All other matters relating to such litigation,
including but not limited to indemnification for such claims, shall be governed
by the provisions of the Indemnification and Insurance Matters Agreement.
(c) All Other Litigation. All other litigation outstanding at the
Separation Date not included in the Litigation Disclosure Letter shall remain
with C-Cube, and Semiconductor shall have no liability in connection with, or
responsibility for defending, such litigation.
SECTION 3.2 COOPERATION. C-Cube and Semiconductor and their respective
Subsidiaries shall cooperate with each other in the defense of any litigation
covered under this ARTICLE III and afford to each other reasonable access upon
reasonable advance notice to witnesses and information (other than information
protected from disclosure by applicable privileges) that is reasonably required
to defend this litigation as set forth in SECTION 4.4 of the Separation
Agreement. The foregoing agreement to cooperate includes, but is not limited to,
an obligation to provide access to qualified assistance to provide information,
witnesses and documents to respond to discovery requests in specific lawsuits.
In such cases, cooperation shall be timely so that the party responding to
discovery may meet all court-imposed deadlines. The party requesting information
shall reimburse the party providing information consistent with the terms of
SECTION 4.4 of the Separation Agreement. The obligations set forth in this
paragraph are more clearly defined in SECTION 4.4 of the Separation Agreement,
to which reference is hereby made.
ARTICLE IV
MISCELLANEOUS
SECTION 4.1 ENTIRE AGREEMENT. This Agreement, the Restated Merger
Agreement, the Master Separation Agreement, the other Ancillary Agreements and
the Exhibits and Schedules referenced or attached hereto and thereto,
constitutes the entire agreement between the parties with respect to the subject
matter hereof and shall supersede all prior written and oral and all
contemporaneous oral agreements and understandings with respect to the subject
matter hereof. In the event any provision of any agreement conflicts with a
provision of the Restated Merger Agreement, the Restated Merger Agreement will
govern.
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SECTION 4.2 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware as to all matters
regardless of the laws that might otherwise govern under principles of conflicts
of laws applicable thereto.
SECTION 4.3 NOTICES. Any notice, demand, offer, request or other
communication required or permitted to be given by either party pursuant to the
terms of this Agreement shall be in writing and shall be deemed effectively
given the earlier of (i) when received, (ii) when delivered personally, (iii)
one (1) business day after being delivered by facsimile (with receipt of
appropriate confirmation), (iv) one (1) business day after being deposited with
an overnight courier service or (v) four (4) days after being deposited in the
US mail, First Class with postage prepaid, and addressed to the attention of the
party's General Counsel at the address of its principal executive office or such
other address as a party may request by notifying the other in writing.
SECTION 4.4 PARTIES IN INTEREST. This Agreement, including the Schedules
and Exhibits hereto, and the other documents referred to herein, shall be
binding upon and inure solely to the benefit of each party hereto and their
legal representatives and successors, and nothing in this Agreement, express or
implied, is intended to confer upon any other Person any rights or remedies of
any nature whatsoever under or by reason of this Agreement.
SECTION 4.5 COUNTERPARTS. This Agreement, including the Schedules and
Exhibits hereto, and the other documents referred to herein, may be executed in
counterparts, each of which shall be deemed to be an original but all of which
shall constitute one and the same agreement.
SECTION 4.6 ASSIGNMENT. This Agreement shall inure to the benefit of and
be binding upon the parties hereto and their respective legal representatives
and successors. This Agreement may not be assigned by any party hereto.
Notwithstanding the foregoing, each party (or its permitted successive assignees
or transferees hereunder) may assign or transfer this Agreement as a whole
without consent to a Person that succeeds to all or substantially all of the
business or assets of such party. Without limiting the foregoing, this Agreement
will be binding upon and inure to the benefit of the parties and their permitted
successors and assigns.
SECTION 4.7 SEVERABILITY. If any term or other provision of this
Agreement or the Schedules or Exhibits attached hereto is determined by a
nonappealable decision by a court, administrative agency or arbitrator to be
invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner materially
adverse to any party. Upon such determination that any term or other provision
is invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner to the end
that transactions contemplated hereby are fulfilled to the fullest extent
possible.
SECTION 4.8 FAILURE OR INDULGENCE NOT WAIVER; REMEDIES CUMULATIVE. No
failure or delay on the part of any party hereto in the exercise of any right
hereunder shall impair such right or be construed to be a waiver of, or
acquiescence in, any breach of any representation, warranty or agreement herein,
nor shall any single or partial exercise of any such right preclude other or
further exercise thereof or of any other right. All rights and remedies existing
under this Agreement or the
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Schedules or Exhibits attached hereto are cumulative to, and not exclusive of,
any rights or remedies otherwise available.
SECTION 4.9 AMENDMENT. No change or amendment will be made to this
Agreement except by an instrument in writing signed on behalf of each of the
parties to such agreement.
SECTION 4.10 AUTHORITY. Each of the parties hereto represents to the
other that (a) it has the corporate or other requisite power and authority to
execute, deliver and perform this Agreement, (b) the execution, delivery and
performance of this Agreement by it have been duly authorized by all necessary
corporate or other action, (c) it has duly and validly executed and delivered
this Agreement, and (d) this Agreement is a legal, valid and binding obligation,
enforceable against it in accordance with its terms subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and general equity principles.
SECTION 4.11 INTERPRETATION. The headings contained in this Agreement, in
any Exhibit or Schedule hereto and in the table of contents to this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Any capitalized term used in any Schedule or
Exhibit but not otherwise defined therein, shall have the meaning assigned to
such term in this Agreement. When a reference is made in this Agreement to an
Article or a Section, Exhibit or Schedule, such reference shall be to an Article
or Section of, or an Exhibit or Schedule to, this Agreement unless otherwise
indicated.
SECTION 4.12 CONFLICTING AGREEMENTS. In the event of conflict between
this Agreement and any other Ancillary Agreement or other agreement executed in
connection herewith, the provisions of Ancillary Agreement and such other
agreement shall prevail.
ARTICLE V
DEFINITIONS
SECTION 5.1 ACTION. "ACTION" means any demand, action, suit, countersuit,
arbitration, inquiry, proceeding or investigation by or before any federal,
state, local, foreign or international governmental authority or any arbitration
or mediation tribunal.
SECTION 5.2 AFFILIATED COMPANY. "AFFILIATED COMPANY" means, with respect
to C-Cube, any entity in which C-Cube holds a 50% or less ownership interest and
that is listed on SCHEDULE 6.1(a) to the Separation Agreement and, with respect
to Semiconductor, any entity in which Semiconductor holds a 50% or less
ownership interest and that is listed on SCHEDULE 6.1(b) to the Separation
Agreement. SCHEDULES 6.1(a) and 6.1(b) may be amended from time to time after
the date hereof upon mutual written consent of the parties.
SECTION 5.3 ANCILLARY AGREEMENT. "ANCILLARY AGREEMENT" has the meaning
set forth in SECTION 2.1 of the Separation Agreement.
SECTION 5.4 ASSETS. "ASSETS" means assets, properties and rights
(including goodwill), wherever located (including in the possession of vendors
or other third parties or elsewhere), whether real, personal or mixed, tangible,
intangible or contingent, in each case whether or not
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recorded or reflected or required to be recorded or reflected on the books and
records or financial statements of any Person, including the following:
(i) all accounting and other books, records and files whether in
paper, microfilm, microfiche, computer tape or disc, magnetic tape or any other
form;
(ii) all apparatus, computers and other electronic data processing
equipment, fixtures, machinery, equipment, furniture, office equipment,
automobiles, trucks, aircraft, rolling stock, vessels, motor vehicles and other
transportation equipment, special and general tools, test devices, prototypes
and models and other tangible personal property;
(iii) all inventories of materials, parts, raw materials, supplies,
work-in-process and finished goods and products;
(iv) all interests in real property of whatever nature, including
easements, whether as owner, mortgagee or holder of a Security Interest, lessor,
sublessor, lessee, sublessee or otherwise;
(v) all interests in any capital stock or other equity interests of
any Subsidiary or any other Person; all bonds, notes, debentures or other
securities issued by any Subsidiary or any other Person; all loans, advances or
other extensions of credit or capital contributions to any Subsidiary or any
other Person; and all other investments in securities of any Person;
(vi) all license agreements, leases of personal property, open
purchase orders for raw materials, supplies, parts or services, unfilled orders
for the manufacture and sale of products and other contracts, agreements or
commitments;
(vii) all deposits, letters of credit and performance and surety
bonds;
(viii) all written technical information, data, specifications,
research and development information, engineering drawings, operating and
maintenance manuals, and materials and analyses prepared by consultants and
other third parties;
(ix) all Intellectual Property and licenses from third Persons
granting the right to use any Intellectual Property;
(x) all computer applications, programs and other software, including
operating software, network software, firmware, middleware, design software,
design tools, systems documentation and instructions;
(xi) all cost information, sales and pricing data, customer prospect
lists, supplier records, customer and supplier lists, customer and vendor data,
correspondence and lists, product literature, artwork, design, development and
manufacturing files, vendor and customer drawings, formulations and
specifications, quality records and reports and other books, records, studies,
surveys, reports, plans and documents;
(xii) all prepaid expenses, trade accounts and other accounts and
notes receivables;
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(xiii) all rights under contracts or agreements, all claims or rights
against any Person arising from the ownership of any Asset, all rights in
connection with any bids or offers and all claims, choses in action or similar
rights, whether accrued or contingent;
(xiv) all rights under insurance policies and all rights in the nature
of insurance, indemnification or contribution;
(xv) all licenses (including radio and similar licenses), permits,
approvals and authorizations which have been issued by any Governmental
Authority;
(xvi) cash or cash equivalents, bank accounts, lock boxes and other
deposit arrangements; and
(xvii) interest rate, currency, commodity or other swap, collar, cap
or other hedging or similar agreements or arrangements.
SECTION 5.5 C-CUBE GROUP. "C-CUBE GROUP" means C-Cube, each Subsidiary and
Affiliated Company of C-Cube (other than any member of the Semiconductor Group)
immediately after the Separation Date and each Person that becomes a Subsidiary
or Affiliate Company of C-Cube after the Separation Date.
SECTION 5.6 CONSENTS. "CONSENTS" means any consents, waivers or approvals
from, or notification requirements to, any third parties.
SECTION 5.7 CONTRACTS. "CONTRACTS" means any contract, agreement, lease,
license, sales order, purchase order, instrument or other commitment that is
binding on any Person or any part of its property under applicable law.
SECTION 5.8 DISTRIBUTION. "DISTRIBUTION" means C-Cube's pro rata
distribution to the holders of its common stock, $0.001 par value of all of the
shares of Semiconductor common stock owned by C-Cube.
SECTION 5.9 DIVICOM BUSINESS. "DIVICOM BUSINESS" means any business of
C-Cube other than the Semiconductor Business.
SECTION 5.10 DISTRIBUTION DATE. "DISTRIBUTION DATE" has the meaning set
forth in SECTION 3.1 of the Separation Agreement.
SECTION 5.11 ENVIRONMENTAL ACTIONS. "ENVIRONMENTAL ACTIONS" has the
meaning set forth in SECTION 4.11 of the Indemnification and Insurance Matters
Agreement.
SECTION 5.12 EXCLUDED ASSETS. "EXCLUDED ASSETS" has the meaning set forth
in SECTION 1.2(b) of this Agreement.
SECTION 5.13 EXCLUDED LIABILITIES. "EXCLUDED LIABILITIES" has the meaning
set forth in SECTION 1.3(b) of this Agreement.
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SECTION 5.14 GOVERNMENTAL APPROVALS. "GOVERNMENTAL APPROVALS" means any
notices, reports or other filings to be made, or any consents, registrations,
approvals, permits or authorizations to be obtained from, any Governmental
Authority.
SECTION 5.15 GOVERNMENTAL AUTHORITY. "GOVERNMENTAL AUTHORITY" means any
federal, state, local, foreign or international court, government, department,
commission, board, bureau, agency, official or other regulatory, administrative
or governmental authority.
SECTION 5.16 INDEMNIFICATION AND INSURANCE MATTERS AGREEMENT.
"INDEMNIFICATION AND INSURANCE MATTERS AGREEMENT" means the Indemnification and
Insurance Matters Agreement attached as Exhibit I to the Separation Agreement.
SECTION 5.17 INSURANCE POLICIES. "INSURANCE POLICIES" means insurance
policies pursuant to which a Person makes a true risk transfer to an insurer.
SECTION 5.18 INSURED SEMICONDUCTOR LIABILITY. "INSURED SEMICONDUCTOR
LIABILITY" means any Semiconductor Liability to the extent that (i) it is
covered under the terms of C-Cube's Insurance Policies in effect prior to the
Distribution Date and (ii) Semiconductor is not a named insured under, or
otherwise entitled to the benefits of, such Insurance Policies.
SECTION 5.19 INTELLECTUAL PROPERTY. "INTELLECTUAL PROPERTY" means all
domestic and foreign patents and patent applications, together with any
continuations, continuations-in-part or divisional applications thereof, and all
patents issuing thereon (including reissues, renewals and re-examinations of the
foregoing); design patents, invention disclosures; mask works; copyrights, and
copyright applications and registrations; Web addresses, trademarks, service
marks, trade names, and trade dress, in each case together with any applications
and registrations therefor and all appurtenant goodwill relating thereto; trade
secrets, commercial and technical information, know-how, proprietary or
confidential information, including engineering, production and other designs,
notebooks, processes, drawings, specifications, formulae, and technology;
computer and electronic data processing programs and software (object and source
code), data bases and documentation thereof; inventions (whether patented or
not); utility models; registered designs, certificates of invention and all
other intellectual property under the laws of any country throughout the world.
SECTION 5.20 LIABILITIES. "LIABILITIES" means all debts, liabilities,
guarantees, assurances, commitments and obligations, whether fixed, contingent
or absolute, asserted or unasserted, matured or unmatured, liquidated or
unliquidated, accrued or not accrued, known or unknown, due or to become due,
whenever or however arising (including, without limitation, whether arising out
of any Contract or tort based on negligence or strict liability) and whether or
not the same would be required by generally accepted principles and accounting
policies to be reflected in financial statements or disclosed in the notes
thereto.
SECTION 5.21 LITIGATION DISCLOSURE LETTER. "LITIGATION DISCLOSURE LETTER"
has the meaning set forth in SECTION 3.1(a) of this Agreement.
SECTION 5.22 PERSON. "PERSON" means an individual, a partnership, a
corporation, a limited liability company, an association, a joint stock company,
a trust, a joint venture, an unincorporated organization and a governmental
entity or any department, agency or political subdivision thereof.
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SECTION 5.23 RETAINED CASH. "RETAINED CASH" has the meaning set forth in
the Separation Agreement.
SECTION 5.24 RETAINED PAYABLES. "RETAINED PAYABLES" means (i) all
accounts payable and other obligations of payment for goods or services
purchased, leased or otherwise received in the conduct of the Semiconductor
Business that as of the Separation Date are payable to a third Person by C-Cube
or any of C-Cube's Subsidiaries, whether past due, due or to become due,
including any interest, sales or use taxes, finance charges, late or returned
check charges and other obligations of C-Cube or any of C-Cube's Subsidiaries
with respect thereto, and any obligations related to any of the foregoing and
(ii) all employee compensation Liabilities and other miscellaneous Liabilities
for which an adjustment is made in the Semiconductor Pro Forma Balance Sheet.
SECTION 5.25 RETAINED RECEIVABLES. "RETAINED RECEIVABLES" means (i) all
accounts receivable and other rights to payment for goods or services sold,
leased or otherwise provided in the conduct of the Semiconductor Business that
as of the Separation Date are payable by a third Person to C-Cube or any of
C-Cube's Subsidiaries, whether past due, due or to become due, including any
interest, sales or use taxes, finance charges, late or returned check charges
and other obligations of the account debtor with respect thereto, and any
proceeds of any of the foregoing and (ii) all other miscellaneous Assets for
which an adjustment is made in the Semiconductor Pro Forma Balance Sheet.
SECTION 5.26 SECURITY INTEREST. "Security Interest" means any mortgage,
security interest, pledge, lien, charge, claim, option, right to acquire, voting
or other restriction, right-of-way, covenant, condition, easement, encroachment,
restriction on transfer, or other encumbrance of any nature whatsoever
SECTION 5.27 SEMICONDUCTOR ASSETS. "SEMICONDUCTOR ASSETS" has the meaning
set forth in SECTION 1.2 of this Agreement.
SECTION 5.28 SEMICONDUCTOR BALANCE SHEET. "SEMICONDUCTOR BALANCE SHEET"
means the audited consolidated balance sheet (including the notes thereto) of
the Semiconductor Business as of _______ ___, ____ that is included in
____________.
SECTION 5.29 SEMICONDUCTOR BUSINESS. "SEMICONDUCTOR BUSINESS" means the
business and operations of C-Cube currently known as C-Cube Semiconductor, as
described in C-Cube's periodic reports to the Commission pursuant to the
Exchange Act and as such business and operations will continue following the
Separation Date, and (b) except as otherwise expressly provided herein, any
terminated, divested or discontinued businesses or operations that at the time
of termination, divestiture or discontinuation primarily related to the
Semiconductor Business as then conducted.
SECTION 5.30 SEMICONDUCTOR CONTINGENT GAIN. "SEMICONDUCTOR CONTINGENT
GAIN" has the meaning set forth in SECTION 1.2 of this Agreement.
SECTION 5.31 SEMICONDUCTOR CONTINGENT LIABILITY. "SEMICONDUCTOR CONTINGENT
LIABILITY" has the meaning set forth in SECTION 1.3 of this Agreement.
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SECTION 5.32 SEMICONDUCTOR CONTRACTS. "SEMICONDUCTOR CONTRACTS" means
[the following contracts and agreements to which C-Cube is a party or by which
it or any of its Assets is bound, whether or not in writing, except for any such
contract or agreement that is contemplated to be retained by C-Cube or any
member of the C-Cube Group pursuant to any provision of this Agreement or any
other Ancillary Agreement:
(i) any contract or agreement entered into in the name of, or
expressly on behalf of, any division or business unit of Semiconductor;
(ii) any contract or agreement that relates primarily to the
Semiconductor Business;
(iii) any contracts or agreements related to the computers, desks,
equipment and other Assets used or managed primarily by employees of C-Cube that
will become employees of Semiconductor in connection with the Separation;
(iv) any contract or agreement that is otherwise expressly
contemplated pursuant to this Agreement, the Separation Agreement or any of the
other Ancillary Agreements to be assigned to Semiconductor; and
(v) any guarantee, indemnity, representation, warranty or other
Liability of any member of the Semiconductor Group or the C-Cube Group in
respect of any other Semiconductor Contract, any Semiconductor Liability or the
Semiconductor Business (including guarantees of financing incurred by customers
or other third parties in connection with purchases of products or services from
the Semiconductor Business)].
SECTION 5.33 SEMICONDUCTOR GROUP. "SEMICONDUCTOR GROUP" means
Semiconductor, each Subsidiary and Affiliated Company of Semiconductor
immediately after the Separation Date and each Person that becomes a Subsidiary
or Affiliate Company of Semiconductor after the Separation Date.
SECTION 5.34 SEMICONDUCTOR INTELLECTUAL PROPERTY. "SEMICONDUCTOR
INTELLECTUAL PROPERTY" has the meaning set forth in SECTION 1.2 of this
Agreement.
SECTION 5.35 SEMICONDUCTOR LIABILITIES. "SEMICONDUCTOR LIABILITIES" has
the meaning set forth in SECTION 1.3 of this Agreement.
SECTION 5.36 SEMICONDUCTOR PRO FORMA BALANCE SHEET. "SEMICONDUCTOR PRO
FORMA BALANCE SHEET" means the unaudited pro forma condensed consolidated
balance sheet appearing in __________.
SECTION 5.37 SEPARATION. "SEPARATION" means the transfer and contribution
from C-Cube to Semiconductor, and Semiconductor's receipt and assumption of,
directly or indirectly, substantially all of the Assets and Liabilities
currently associated with the Semiconductor Business and the stock, investments
or similar interests currently held by C-Cube in subsidiaries and other entities
that conduct such business.
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SECTION 5.38 SEPARATION AGREEMENT. "SEPARATION AGREEMENT" means the Master
Separation and Distribution Agreement dated as of _______ ___, 1999, of which
this is an Exhibit thereto.
SECTION 5.39 SEPARATION DATE. "SEPARATION DATE" means the effective date
and time of each transfer of property, assumption of liability, license,
undertaking, or agreement in connection with the Separation, which shall be
12:01 a.m., Pacific Time, _______ ___, 2000, or such date as may be fixed by the
Board of Directors of C-Cube.
SECTION 5.40 SUBSIDIARY. "SUBSIDIARY" means with respect to any specified
Person, any corporation, any limited liability company, any partnership or other
legal entity of which such Person or its Subsidiaries owns, directly or
indirectly, more than 50% of the stock or other equity interest entitled to vote
on the election of the members of the board of directors or similar governing
body. Unless context otherwise requires, reference to C-Cube and its
Subsidiaries shall not include the subsidiaries of C-Cube that will be
transferred to Semiconductor after giving effect to the Separation.
SECTION 5.41 TAXES. "TAXES" has the meaning set forth in the Tax Sharing
Agreement.
[SIGNATURES ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, each of the parties has caused the General Assignment
and Assumption Agreement to be executed on its behalf by its officers thereunto
duly authorized on the day and year first above written.
C-CUBE MICROSYSTEMS INC.
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
C-CUBE SEMICONDUCTOR INC.
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
[SIGNATURE PAGE TO GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT]
25
[SCHEDULE 1.2(a)(xii)
SPECIFIC SEMICONDUCTOR ASSETS TO BE TRANSFERRED]
26
[SCHEDULE 1.2(b)(i)
EXCLUDED ASSETS]
27
[SCHEDULE 1.3(a)(vi)
[DIVESTED BUSINESSES WHICH CONTAIN LIABILITIES
TO BE TRANSFERRED TO SEMICONDUCTOR]
28
[SCHEDULE 1.3(a)(vii)
SPECIFIC SEMICONDUCTOR LIABILITIES]
29
[SCHEDULE 1.3(b)(i)
EXCLUDED LIABILITIES]
