SEPARATION AND DISTRIBUTION AGREEMENT BY AND AMONG UNITED TECHNOLOGIES CORPORATION, CARRIER GLOBAL CORPORATION AND OTIS WORLDWIDE CORPORATION DATED AS OF APRIL 2, 2020
Exhibit 2.1
EXECUTION VERSION
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BY AND AMONG
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UNITED TECHNOLOGIES CORPORATION,
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CARRIER GLOBAL CORPORATION
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AND
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XXXX WORLDWIDE CORPORATION
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DATED AS OF APRIL 2, 2020
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TABLE OF CONTENTS
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Page
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ARTICLE I DEFINITIONS
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2
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ARTICLE II THE SEPARATION
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18
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2.1
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Transfer of Assets and Assumption of Liabilities
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18
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2.2
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Carrier Assets; Otis Assets; UTC Assets
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21
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2.3
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Carrier Liabilities; Otis Liabilities; UTC Liabilities
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25
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2.4
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Approvals, Notifications and Delays
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29
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2.5
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Novation of Liabilities
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30
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2.6
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Release of Guarantees
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31
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2.7
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Termination of Agreements
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32
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2.8
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Treatment of Shared Contracts
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33
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2.9
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Bank Accounts; Cash Balances
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34
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2.10
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Ancillary Agreements
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35
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2.11
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Disclaimer of Representations and Warranties
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35
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2.12
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Financing Arrangements; Cash Transfers.
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36
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2.13
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Financial Information Certifications
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37
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2.14
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Transition Committee
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38
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ARTICLE III THE DISTRIBUTIONS
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38
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3.1
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Sole and Absolute Discretion; Cooperation
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38
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3.2
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Actions Prior to the Distribution
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39
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3.3
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Conditions to Each Distribution
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40
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3.4
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The Distributions
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42
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ARTICLE IV MUTUAL RELEASES; INDEMNIFICATION
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44
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4.1
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Release of Pre-Distribution Claims
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44
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4.2
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Indemnification by Carrier
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47
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4.3
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Indemnification by Otis
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48
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4.4
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Indemnification by UTC
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49
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4.5
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Indemnification Obligations Net of Insurance Proceeds and Other Amounts
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49
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4.6
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Procedures for Indemnification of Third-Party Claims
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50
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4.7
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Additional Matters
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52
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4.8
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Right of Contribution
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53
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4.9
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Covenant Not to Xxx
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54
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4.10
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Remedies Cumulative
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54
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4.11
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Survival of Indemnities
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55
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ARTICLE V CERTAIN OTHER MATTERS
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55
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5.1
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Insurance Matters
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55
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5.2
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Late Payments
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58
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5.3
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Inducement
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58
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5.4
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Post-Effective Time Conduct
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58
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5.5
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Director and Officer Insurance
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59
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ARTICLE VI EXCHANGE OF INFORMATION; CONFIDENTIALITY
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59
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6.1
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Agreement for Exchange of Information
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59
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6.2
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Ownership of Information
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60
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6.3
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Compensation for Providing Information
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60
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6.4
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Record Retention
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61
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6.5
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Limitations of Liability
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61
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6.6
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Other Agreements Providing for Exchange of Information
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61
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6.7
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Production of Witnesses; Records; Cooperation
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61
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6.8
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Privileged Matters
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62
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6.9
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Confidentiality
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65
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6.10
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Protective Arrangements
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66
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ARTICLE VII DISPUTE RESOLUTION
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67
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7.1
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Good Faith Officer Negotiation
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67
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7.2
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Mediation
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67
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7.3
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Arbitration
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68
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7.4
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Litigation and Unilateral Commencement of Arbitration
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68
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7.5
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Conduct During Dispute Resolution Process
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69
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7.6
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Dispute Resolution Coordination
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69
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ARTICLE VIII FURTHER ASSURANCES AND ADDITIONAL COVENANTS
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69
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8.1
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Further Assurances
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69
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ARTICLE IX TERMINATION
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70
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9.1
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Termination
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70
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9.2
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Effect of Termination
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71
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ARTICLE X MISCELLANEOUS
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71
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10.1
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Counterparts; Entire Agreement; Corporate Power
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71
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10.2
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Governing Law
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72
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10.3
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Assignability
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72
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10.4
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Third-Party Beneficiaries
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72
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10.5
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Notices
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72
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10.6
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Severability
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74
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10.7
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Force Majeure
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74
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10.8
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No Set-Off
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75
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10.9
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Expenses
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75
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10.10
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Headings
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75
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10.11
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Survival of Covenants
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75
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10.12
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Waivers of Default
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75
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10.13
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Specific Performance
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75
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10.14
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Amendments
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76
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10.15
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Interpretation
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76
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10.16
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Limitations of Liability
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77
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10.17
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Performance
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77
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10.18
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Mutual Drafting
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77
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10.19
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Ancillary Agreements
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77
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SCHEDULES
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Schedule 1.1
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Carrier Discontinued or Divested Businesses
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Schedule 1.2
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Carrier Contracts
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Schedule 1.3
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Carrier Transferred Entities
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Schedule 1.4
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Otis Discontinued or Divested Businesses
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Schedule 1.5
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Otis Contracts
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Schedule 1.6
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Otis Transferred Entities
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Schedule 2.1(a)
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Plan of Reorganization
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Schedule 2.2(a)(ix)(A)
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Carrier Former Captive Assets
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Schedule 2.2(a)(x)
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Carrier Assets
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Schedule 2.2(b)(ix)(A)
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Otis Former Captive Assets
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Schedule 2.2(b)(x)
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Otis Assets
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Schedule 2.2(c)
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UTC Assets
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Schedule 2.3(a)(iii)
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Carrier Liabilities
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Schedule 2.3(a)(iv)
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Carrier Business Liabilities
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Schedule 2.3(a)(viii)
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Carrier Specified Litigation Liabilities
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ScheduleΒ 2.3(b)(iii)
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Otis LiabilitiesΒ
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Schedule 2.3(b)(iv)
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Otis Business Liabilities
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Schedule 2.3(b)(viii)
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Otis Specified Litigation Liabilities
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Schedule 2.3(c)(i)
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UTC Liabilities
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Schedule 2.5(a)
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Novation of Liabilities
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ScheduleΒ 2.7(b)(ii)
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Intercompany Agreements
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Schedule 2.12(a)
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Carrier Financing Arrangements
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Schedule 2.12(b)
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Otis Financing Arrangements
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Schedule 4.4(e)
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Specified UTC Information
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Schedule 5.1(b)
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Insurance Access Limitations
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Schedule 10.9
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Allocation of Certain Costs and Expenses
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EXHIBITS
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Exhibit A
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Amended and Restated Certificate of Incorporation of Carrier Global Corporation
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Exhibit B
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Amended and Restated Bylaws of Carrier Global Corporation
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Exhibit C
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Amended and Restated Certificate of Incorporation of Xxxx Worldwide Corporation
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Exhibit D
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Amended and Restated Bylaws of Xxxx Worldwide Corporation
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This SEPARATION AND DISTRIBUTION AGREEMENT, dated as of April 2, 2020 (this βAgreementβ), is by and among United Technologies Corporation, a Delaware corporation (βUTCβ), Carrier Global Corporation, a
Delaware corporation (βCarrierβ) and Xxxx Worldwide Corporation, a Delaware corporation (βOtisβ).Β Capitalized terms used herein and not otherwise defined shall have the respective meanings assigned to them in Article I.
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R E C I T A L S
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WHEREAS, the board of directors of UTC (the βUTC Boardβ) has determined that it is in the best interests of UTC and its shareowners to separate UTC into three independent, publicly traded companies, one that
shall operate the UTC Business, one that shall operate the Carrier Business and one that shall operate the Otis Business;
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WHEREAS, in furtherance of the foregoing, the UTC Board has determined that it is appropriate and desirable to (a) separate the Carrier Business from the UTC Business and the Otis Business (the βCarrier Separationβ)
and, following the Carrier Separation, make a distribution, on a pro rata basis, to holders of UTC Shares on the Carrier Record Date of all of the outstanding Carrier Shares owned by UTC (the βCarrier
Distributionβ) and (b) separate the Otis Business from the UTC Business and the Carrier Business (the βOtis Separation,β and the Carrier Separation, together or as applicable, the βSeparationβ) and, following the Otis
Separation, make a distribution, on a pro rata basis, to holders of UTC Shares on the Otis Record Date (which may be the same date as the Carrier Record Date) of all of the outstanding Otis Shares owned by
UTC (the βOtis Distribution,β and together with the Carrier Distribution, the βDistributionsβ);
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WHEREAS, each of Carrier and Otis has been incorporated solely for these purposes and has not engaged in activities, except those incidental to the Separation and the Distributions;
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WHEREAS, for U.S. federal income tax purposes, it is intended that (a) the contribution by UTC of the Carrier Assets to Carrier in exchange for (i) the assumption by Carrier of the Carrier Liabilities,
(ii) the actual or deemed issuance by Carrier to UTC of additional Carrier Shares and (iii) the Carrier Cash Transfer (the βCarrier Contributionβ) and the Carrier Distribution, taken together, shall qualify as a transaction that is generally
tax-free pursuant to Sections 355(a) and 368(a)(1)(D) of the Code and (b) the contribution by UTC of the Otis Assets to Otis in exchange for (i) the assumption by Otis of the Otis Liabilities, (ii) the actual or deemed issuance by Otis to UTC of
additional Otis Shares and (iii) the Xxxx Xxxx Transfer (the βOtis Contributionβ) and the Otis Distribution, taken together, shall qualify as a transaction that is generally tax-free pursuant to Sections 355(a) and 368(a)(1)(D) of the Code;
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WHEREAS, the IRS has issued to UTC a private letter ruling regarding certain U.S. federal income tax matters relating to the transactions contemplated by this Agreement (the βIRS Rulingβ);
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WHEREAS, UTC expects to receive (a) an opinion of outside legal counsel regarding the qualification of certain elements of the Carrier Distribution under Section 355 of the Code and (b) an opinion of
outside legal counsel regarding the qualification of certain elements of the Otis Distribution under Section 355 of the Code;
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WHEREAS, Carrier and UTC have prepared, and Carrier has filed with the SEC, the Carrier Form 10, which includes the Carrier Information Statement and which sets forth disclosure concerning Carrier, the
Carrier Separation and the Carrier Distribution;
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WHEREAS, Otis and UTC have prepared, and Otis has filed with the SEC, the Otis Form 10, which includes the Otis Information Statement and which sets forth disclosures concerning Otis, the Otis
Separation and the Otis Distribution; and
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WHEREAS, each of UTC, Carrier and Otis has determined that it is appropriate and desirable to set forth the principal corporate transactions required
to effect the Separation and the Distributions and certain other agreements that will govern certain matters relating to the Separation and the Distributions and the relationship of UTC, Carrier and Otis and the members of their respective Groups
following the Distributions.
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NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Parties, intending to be legally bound, hereby agree as follows:
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ARTICLE I
DEFINITIONS
DEFINITIONS
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For the purpose of this Agreement, the following terms shall have the following meanings:
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βAccountsβ shall have the meaning set forth in Section 2.9(a).
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βActionβ shall mean any demand, action, claim, dispute, suit, countersuit, arbitration, inquiry, subpoena, proceeding or investigation of any
nature (whether criminal, civil, legislative, administrative, regulatory, prosecutorial or otherwise) by or before any federal, state, local, foreign or international Governmental Authority or any arbitration or mediation tribunal.
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βAffiliateβ shall mean, when used with respect to a specified Person, a Person that, directly or indirectly, through one or more intermediaries,
controls, is controlled by or is under common control with such specified Person.Β For the purpose of this definition, βcontrolβ (including, with correlative meanings, βcontrolled byβ and βunder common control withβ), when used with respect to any specified Person shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management
and policies of such Person, whether through the ownership of voting securities or other interests, by contract, agreement, obligation, indenture, instrument, lease, promise, arrangement, release, warranty, commitment, undertaking or otherwise.Β
It is expressly agreed that, prior to,Β at and after the applicable Effective Time, solely for purposes of this Agreement and the Ancillary Agreements,
(a) no member of the Carrier Group shall be deemed to be an Affiliate of any member of the UTC Group or the Otis
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Group, (b) no member of the Otis Group shall be deemed to be an Affiliate of any member of the UTC Group or the Carrier Group and (c) no member of the UTC Group shall be deemed to be an Affiliate of any member of the
Carrier Group or the Otis Group.
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βAgreementβ shall have the meaning set forth in the Preamble.
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βAncillary Agreementsβ shall mean all agreements (other than this Agreement) entered into by the Parties or the members of their respective Groups (but as to which no Third Party is a party) in
connection with the Separation, the Distributions or the other transactions contemplated by this Agreement, including the Transition Services Agreement, the Tax Matters Agreement, the Employee Matters Agreement, the Intellectual Property Agreement
and the Transfer Documents; it being understood that, for the avoidance of doubt, the Merger Agreement, and any documents or agreements ancillary thereto shall not be deemed to be Ancillary Agreements.
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βApplicable Third-Party Insurance Separation Dateβ shall mean, (a) with respect to each relevant
Third-Party occurrence-based insurance policy of Carrier or Otis obtained in connection with the Separation, the effective date of such policy, which in no event shall be later than the Effective Time, and (b) with respect to all other losses,
damages and Liabilities, the Effective Time.
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βApprovals or Notificationsβ shall mean any consents, waivers, approvals, Permits or authorizations to be obtained from, notices, registrations or reports to be submitted to, or other filings to
be made with, any Third Party, including any Governmental Authority.
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βArbitration Requestβ shall have the meaning set forth in Section 7.3(a).
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βAssetsβ shall mean, with respect to any Person, the assets, properties, claims and rights (including goodwill) of such Person, wherever located (including in the possession of vendors or other
Third Parties or elsewhere), of every kind, character and description, whether real, personal or mixed, tangible, intangible or contingent, in each case, whether or not recorded or reflected or required to be recorded or reflected on the books and
records or financial statements of such Person, including rights and benefits pursuant to any contract, license, Permit, indenture, note, bond, mortgage, agreement, concession, franchise, instrument, undertaking, commitment, understanding or other
arrangement.
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βBound Memberβ shall have the meaning set forth in Section 2.5(b).
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βCarrierβ shall have the meaning set forth in the Preamble.
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βCarrier Accountsβ shall mean each bank or brokerage account, and all contracts or agreements governing each bank or brokerage account, owned by Carrier or any member of its Group.
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βCarrier Assetsβ shall have the meaning set forth in Section 2.2(a).
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βCarrier Balance Sheetβ shall mean the pro forma combined balance sheet of the Carrier Business, including any notes and subledgers thereto, as of December 31, 2019, as presented in the Carrier
Information Statement made available to the Record Holders.
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βCarrier Businessβ shall mean, collectively, (a)Β the business, operations and activities of the βCarrierβ (formerly known as UTC Climate, Controls & Security) reporting segment of UTC
conducted at any time prior to the Effective Time by any of the Parties or any of their respective current or former Subsidiaries, (b)Β any terminated, divested or discontinued businesses, operations and activities that, at the time of termination,
divestiture or discontinuation, primarily related to the business, operations and activities described in clause (a) as then conducted, including those set forth on Schedule 1.1, and (c) the Xxxxxxx Company.
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βCarrier Bylawsβ shall mean the Amended and Restated Bylaws of Carrier, substantially in the form of Exhibit B.
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βCarrier Captive Liabilitiesβ shall have the meaning set forth in Section 2.3(a)(vi).
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βCarrier Captive Subsidiariesβ shall mean (a) any unincorporated cell in a protected cell captive insurance company (or equivalent) with respect to which Carrier beneficially owns, directly or indirectly, more
than fifty percent (50%) of the equity interests and (b) any Person that is a captive or cell captive insurance Subsidiary of Carrier as of the Effective Time.
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βCarrier Cash Transferβ shall have the meaning set forth in Section 2.12(a).
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βCarrier Certificate of Incorporationβ shall mean the Amended and Restated Certificate of Incorporation of Carrier, substantially in the form of Exhibit A.
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βCarrier Contractsβ shall mean the following contracts and agreements to which any of the Parties or any member of their respective Groups is a party or by which any of the Parties or any member
of their respective Groups or any of their respective Assets is bound, whether or not in writing (provided that Carrier Contracts shall not include (x)Β any contract or agreement that is contemplated to be retained by UTC or any member of the
UTC Group from and after the Effective Time pursuant to any provision of this Agreement or any Ancillary Agreement or (y) any contract or agreement that is contemplated to be an Otis Contract from and after the Effective Time pursuant to any
provision of this Agreement or any Ancillary Agreement):
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(a)Β Β Β Β Β Β Β Β Β Β (i) any customer or distribution contract or agreement with a Third Party entered into prior to the Effective Time primarily related to the Carrier
Business and (ii)Β with respect to any customer or distribution contract or agreement with a Third Party entered into prior to the Effective Time that relates to the Carrier Business but is not primarily related to the Carrier Business, that portion
of any such customer or distribution contract or agreement that relates to the Carrier Business;
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(b)Β Β Β Β Β Β Β Β Β Β (i) any supply or vendor contract or agreement with a Third Party entered into prior to the Effective Time exclusively related to the Carrier
Business and (ii)Β with respect to any supply or vendor contract or agreement with a Third Party entered into
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prior to the Effective Time that relates to the Carrier Business but is not exclusively related to the Carrier Business, that portion of any such supply or vendor contract or agreement that relates to the Carrier
Business;
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(c)Β Β Β Β Β Β Β Β Β Β (i) any license agreement entered into prior to the Effective Time primarily related to the Carrier Business and (ii) with respect to any license agreement entered into prior to the
Effective Time that relates to the Carrier Business but is not primarily related to the Carrier Business, that portion of any such license agreement that relates to the Carrier Business;
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(d)Β Β Β Β Β Β Β Β Β Β any guarantee, indemnity, representation, covenant, warranty or other contractual Liability of any of the Parties or any member of their respective Groups to the extent in respect of any
other Carrier Contract or Carrier Liability or the Carrier Business;
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(e)Β Β Β Β Β Β Β Β Β Β any contract or agreement that is expressly contemplated pursuant to this Agreement or any of the Ancillary Agreements to be assigned to Carrier or any member of the Carrier Group;
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(f)Β Β Β Β Β Β Β Β Β Β any credit agreement, indenture, note or other financing agreement or instrument entered into by Carrier and/or any member of the Carrier Group in
connection with the Separation, including any Carrier Financing Arrangements;
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(g)Β Β Β Β Β Β Β Β Β Β any other contract or agreement not otherwise set forth herein and primarily related to the Carrier Business or Carrier Assets;
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(h)Β Β Β Β Β Β Β Β Β Β any employment, change of control, retention, consulting, indemnification, termination, severance or other similar agreements with (i) any Carrier Group Employee (as defined in the
Employee Matters Agreement) or (ii) any consultant or contractor of the Carrier Group (if such agreement is primarily related to the Carrier Business or Carrier Assets) that is in effect as of the Effective Time; and
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(i)Β Β Β Β Β Β Β Β Β Β any contracts, agreements or settlements set forth on Schedule 1.2, including the right to recover any amounts under such contracts, agreements or settlements.
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βCarrier Contributionβ shall have the meaning set forth in the Recitals.
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βCarrier Designeesβ shall mean any and all entities (including corporations, general or limited
partnerships, trusts, joint ventures, unincorporated organizations, limited liability entities or other entities) designated by UTC that will be members of the Carrier Group as of immediately prior to the Effective Time.
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βCarrier Disclosure Documentβ shall mean the Carrier Form 10, the Carrier Information Statement and any other registration statement, prospectus, offering memorandum, offering circular, periodic
report, proxy statement or similar disclosure document, whether or not filed with the SEC and whether or not filed with any other Governmental Authority, in each case, (a) filed, distributed or otherwise made available by or on behalf of Carrier or
any member of the
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Carrier Group or (b) that primarily relates to the transactions with respect to Carrier contemplated hereby.
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βCarrier Distributionβ shall have the meaning set forth in the Recitals.
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βCarrier Distribution Dateβ shall mean the date of the consummation of the Carrier Distribution, which shall be determined by the UTC Board in its sole and absolute discretion.
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βCarrier Distribution Ratioβ shall mean a number equal to one (1).
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βCarrier Effective Timeβ shall mean 12:01 a.m., New York City time, on the Carrier Distribution Date.
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βCarrier Financing Arrangementsβ shall have the meaning set forth in Section 2.12(a).
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βCarrier Form 10β shall mean the registration statement on Form 10 filed by Carrier with the SEC to effect the registration of Carrier Shares pursuant to the Exchange Act in connection with the
Carrier Distribution, as such registration statement may be amended or supplemented from time to time prior to the Carrier Distribution.
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βCarrier Groupβ shall mean (a) prior to the Effective Time, Carrier and each Person that will be a Subsidiary of Carrier as of immediately after the Effective Time, including the Carrier
Transferred Entities and their respective Subsidiaries, even if, prior to the Effective Time, such Person is not a Subsidiary of Carrier and (b) on and after the Effective Time, Carrier and each Person that is a Subsidiary of Carrier.
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βCarrier Indemniteesβ shall have the meaning set forth in Section 4.3.
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βCarrier Information Statementβ shall mean the information statement to be made available to the holders of UTC Shares in connection with the Carrier Distribution, as such information statement
may be amended or supplemented from time to time prior to the Carrier Distribution.
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βCarrier Intellectual Property Rightsβ shall mean (a) all Intellectual Property Rights owned by Carrier or any member of the Carrier Group as of immediately prior to the Effective Time, except
for all Intellectual Property Rights to be assigned from Carrier or any member of the Carrier Group to UTC, Otis, any member of the UTC Group or any member of the Otis Group pursuant to Section 2.1 of the Intellectual Property Agreement, (b) all
Intellectual Property Rights to be assigned from UTC, Otis, any member of the UTC Group or any member of the Otis Group to Carrier or any member of the Carrier Group pursuant to Section 2.1 of the Intellectual Property Agreement and (c) rights to
bring claims or seek damages for infringement of the Intellectual Property Rights described in the foregoing clauses (a) and (b) against or from a Third Party.
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βCarrier Liabilitiesβ shall have the meaning set forth in Section 2.3(a).
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βCarrier Permitsβ shall mean all Permits owned or licensed by any of the Parties or any member of their respective Groups used or held for use solely or primarily in the Carrier Business
immediately prior to the Effective Time.
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βCarrier Record Dateβ shall mean the close of business on the date determined by the UTC Board as the record date for determining holders of UTC Shares entitled to receive Carrier Shares pursuant
to the Carrier Distribution.
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βCarrier Separationβ shall have the meaning set forth in the Recitals.
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βCarrier Sharesβ shall mean the shares of common stock, par value $0.01 per share, of Carrier.
Β
βCarrier Technologyβ shall mean all Technology that is used or held for use in the Carrier Business
as of immediately prior to the Effective Time, the Intellectual Property Rights with respect to which are owned by any of the Parties or any member of their respective Groups as of immediately prior to the Effective Time.
Β
βCarrier Transferred Entitiesβ shall mean the entities set forth on Schedule
1.3.Β Β Β
Β
βCodeβ shall mean the Internal Revenue Code of 1986, as amended.
Β
βControl Rightβ shall have the meaning set forth in Section 5.1(f).
Β
βCPRβ shall have the meaning set forth in Section 7.2.
Β
βDelayed Assetβ shall have the meaning set forth in Section 2.4(c).
Β
βDelayed Liabilityβ shall have the meaning set forth in Section 2.4(c).
Β
βDesignated Partyβ shall have the meaning set forth in Section 2.5(b).
Β
βDisputeβ shall have the meaning set forth in Section 7.1.
Β
βDistribution Agentβ shall mean the trust company or companies or bank or banks duly appointed by
UTC to act as distribution agent(s), transfer agent(s) and registrar(s) for the Carrier Shares and the Otis Shares, respectively, in connection with the Distributions.
Β
βDistribution Dateβ shall mean the Carrier Distribution Date or the Otis Distribution Date, as applicable.
Β
βDistributionsβ shall have the meaning set forth in the Recitals.
Β
βEffective Timeβ shall mean the Carrier Effective Time or the Otis Effective Time, as applicable; it being understood that except as otherwise specified herein, if the Carrier Effective Time and
the Otis Effective Time do not occur at the same time, then:Β (a) as between Carrier or any member of the Carrier Group, on the one hand, and Otis or any member of the Otis Group, on the other hand, the term βEffective Timeβ shall refer to the
First Effective Time; (b) as between Carrier or any member of the Carrier Group, on the one hand, and UTC or any
Β
-7-
member of the UTC Group on the other hand, the term βEffective Timeβ shall refer to the Carrier Effective Time; and (c) as between Otis or any member of the Otis Group, on the one hand, and UTC or any member of the UTC
Group on the other hand, the term βEffective Timeβ shall refer to the Otis Effective Time.
Β
βe-mailβ shall have the meaning set forth in Section 10.5.
Β
βEmployee Matters Agreementβ shall mean the Employee Matters Agreement to be entered into by and among UTC, Carrier and Otis or the members of their respective Groups in connection with the
Separation, the Distributions or the other transactions contemplated by this Agreement, as it may be amended from time to time.
Β
βEnvironmental Lawβ shall mean any Law relating to pollution, protection or restoration of or prevention of harm to the environment or natural resources, including the use, handling,
transportation, treatment, storage, disposal, Release or discharge of Hazardous Materials or the protection of or prevention of harm to human health and safety.
Β
βEnvironmental Liabilitiesβ shall mean all Liabilities relating to, arising out of or resulting from any Hazardous Materials, Environmental Law or contract or agreement relating to environmental,
health or safety matters (including all removal, remediation or cleanup costs, investigatory costs, response costs, natural resources damages, property damages, personal injury damages, costs of compliance with any product take-back requirements or
with any settlement, judgment or other determination of Liability and indemnity, contribution or similar obligations) and all costs and expenses, interest, fines, penalties or other monetary sanctions in connection therewith.
Β
βExchange Actβ shall mean the U.S. Securities Exchange Act of 1934, as amended, together with the rules and regulations promulgated thereunder.
Β
βFirst Effective Timeβ shall mean (a) if the Carrier Effective Time and the Otis Effective Time do not occur at the same time, the first to occur of the Carrier Effective Time and the Otis
Effective Time or (b) if the Carrier Effective Time and the Otis Effective Time occur at the same time, the Effective Time.
Β
βForce Majeureβ shall mean, with respect to a Party, an event beyond the reasonable control of such Party (or any Person acting on its behalf), which event (a) does not arise or result from the fault or
negligence of such Party (or any Person acting on its behalf) and (b) by its nature would not reasonably have been foreseen by such Party (or such Person), or, if it would reasonably have been foreseen, was unavoidable, and includes acts of God,
acts of civil or military authority, acts of terrorism, cyberattacks, embargoes, epidemics, war, riots, insurrections, fires, explosions, earthquakes, floods, unusually severe weather conditions, labor problems or unavailability of parts, or, in
the case of computer systems, any significant and prolonged failure in electrical or air-conditioning equipment.Β Notwithstanding the foregoing, the receipt by a Party of an unsolicited takeover offer or other acquisition proposal, even if
unforeseen or unavoidable, and such Partyβs response thereto, shall not be deemed an event of Force Majeure.
Β
βForm 10sβ shall mean the Carrier Form 10 and the Otis Form 10.
Β
-8-
βGovernmental Authorityβ shall mean any nation or government, any state, municipality or other political subdivision thereof, and any entity, body, agency, commission, department, board, bureau,
court, tribunal or other instrumentality, whether domestic, foreign, multinational, national, supranational, federal, state, territorial, provincial or local, exercising executive, legislative, judicial, regulatory, administrative or other similar
functions of, or pertaining to, a government and any executive official thereof.
Β
βGroupβ shall mean the UTC Group, the Carrier Group or the Otis Group, as the context requires.
Β
βHazardous Materialsβ shall mean any chemical, material, substance, waste, pollutant, emission, discharge, Release or contaminant that could result in Liability under, or that is prohibited,
limited or regulated by or pursuant to, any Environmental Law, and any natural or artificial substance (whether solid, liquid or gas, noise, ion, vapor or electromagnetic) that could cause harm to human health or the environment, including
petroleum, petroleum products and byproducts, asbestos and asbestos-containing materials, urea formaldehyde foam insulation, electronic, medical or infectious wastes, per- and polyfluoroakyl substances, polychlorinated biphenyls, radon gas,
radioactive substances, chlorofluorocarbons and all other ozone-depleting substances.
Β
βHolding Memberβ shall have the meaning set forth in Section 2.4(c).
Β
βIndemnifying Partyβ shall have the meaning set forth in Section 4.5(a).
Β
βIndemniteeβ shall have the meaning set forth in Section 4.5(a).
Β
βIndemnity Paymentβ shall have the meaning set forth in Section 4.5(a).
Β
βInformationβ shall mean information, whether or not patentable or copyrightable, in written, oral, electronic or other tangible or intangible forms, stored in any medium, including studies,
reports, records, books, contracts, instruments, surveys, discoveries, ideas, concepts, know-how, techniques, designs, specifications, drawings, blueprints, artwork, design, research and development files, diagrams, models, prototypes, samples,
flow charts, data, computer data, disks, diskettes, tapes, computer programs or other software, marketing plans, customer names, communications by or to attorneys (including attorney-client privileged communications), memos and other materials
prepared by attorneys or under their direction (including attorney work product), and other technical, financial, employee or business information or data.
Β
βInformation Statementsβ shall mean the Carrier Information Statement and the Otis Information Statement.
Β
βInsurance Proceedsβ shall mean those monies:
Β
(a)Β Β Β Β Β Β Β Β Β Β received by an insured from an insurance carrier; or
Β
(b)Β Β Β Β Β Β Β Β Β Β paid by an insurance carrier on behalf of the insured;
Β
-9-
in any such case net of any applicable premium adjustments (including reserves and retrospectively rated premium adjustments) and net of any costs or expenses (including attorneysβ fees) incurred in the collection thereof; provided, that
with respect to a captive insurance arrangement, Insurance Proceeds shall only include amounts received by the captive insurer from a Third Party in respect of any reinsurance arrangement.
Β
βIntellectual Property Agreementβ shall mean the Intellectual Property Agreement to be entered into by and among UTC, Carrier and Otis in connection with the Separation, the Distributions or the
other transactions contemplated by this Agreement, as it may be amended from time to time.
Β
βIntellectual Property Rightsβ shall have the meaning set forth in the Intellectual Property
Agreement.
Β
βIRSβ shall mean the U.S. Internal Revenue Service.
Β
βIRS Rulingβ shall have the meaning set forth in the Recitals.
Β
βLawβ shall mean any domestic, foreign, multinational, national, supranational, federal, state, territorial, provincial, local or similar law (including common law), statute, code, order,
ordinance, rule, regulation, treaty (including any income tax treaty), license, permit, authorization, approval, consent, decree, injunction, binding judicial or administrative interpretation or other requirement, in each case, enacted,
promulgated, issued or entered by a Governmental Authority.
Β
βLiabilitiesβ shall mean all debts, guarantees, assurances, commitments, liabilities, responsibilities, Losses, remediation, deficiencies, damages, fines, penalties, settlements, sanctions,
costs, expenses, attorneysβ fees, interest and obligations of any nature or kind, whether accrued or fixed, absolute or contingent, matured or unmatured, accrued or not accrued, asserted or unasserted, liquidated or unliquidated, foreseen or
unforeseen, known or unknown, reserved or unreserved, or determined or determinable, including those arising under any Law, claim (including any Third-Party Claim), demand, Action, or order, writ, judgment, injunction, decree, stipulation,
determination or award entered by or with any Governmental Authority or arbitration tribunal, and those arising under any contract, agreement, obligation, indenture, instrument, lease, promise, arrangement, release, warranty, commitment or
undertaking, or any fines, damages or equitable relief that is imposed, in each case, including all costs and expenses relating thereto.
Β
βLinkedβ shall mean, with respect to any Accounts, linked by automatic withdrawal, automatic deposit or any other authorization to transfer funds from or to such Accounts.
Β
βLossesβ shall mean actual losses (including any diminution in value), costs, damages, penalties and expenses (including legal and accounting fees and expenses and costs of investigation and
litigation), whether or not involving a Third-Party Claim.
Β
βMediation Requestβ shall have the meaning set forth in Section 7.2.
Β
-10-
βMerger Agreementβ shall mean the Agreement and Plan of Merger by and among UTC, Light Merger Sub Corp. and Raytheon Company, dated as of June 9, 2019.
Β
βNYSEβ shall mean the New York Stock Exchange.
Β
βOfficer Negotiation Requestβ shall have the meaning set forth in Section 7.1.
Β
βOtisβ shall have the meaning set forth in the Preamble.
Β
βOtis Accountsβ shall mean each bank or brokerage account, and all contracts or agreements governing each bank or brokerage account, owned by Otis or any member of its Group.
Β
βOtis Assetsβ shall have the meaning set forth in Section 2.2(b).
Β
βOtis Balance Sheetβ shall mean the pro forma combined balance sheet of the Xxxx Business, including any notes and subledgers thereto, as of December 31, 2019, as presented in the Otis
Information Statement made available to the Record Holders.
Β
βOtis Businessβ shall mean, collectively, (a)Β the business, operations and activities of the βOtisβ reporting segment of UTC conducted at any time prior to the Effective Time by any of the
Parties or any of their respective current or former Subsidiaries and (b)Β any terminated, divested or discontinued businesses, operations and activities that, at the time of termination, divestiture or discontinuation, primarily related to the
business, operations and activities described in clause (a) as then conducted, including those set forth on Schedule 1.4.
Β
βOtis Bylawsβ shall mean the Amended and Restated Bylaws of Otis, substantially in the form of Exhibit D.
Β
βOtis Captive Liabilitiesβ shall have the meaning set forth in Section 2.3(b)(vi).
Β
βOtis Captive Subsidiariesβ shall mean (a) any unincorporated cell in a protected cell captive insurance company (or equivalent) with respect to which Otis beneficially owns, directly or indirectly, more than
fifty percent (50%) of the equity interests and (b) any Person that is a captive or cell captive insurance Subsidiary of Xxxx as of the Effective Time.
Β
βXxxx Xxxx Transferβ shall have the meaning set forth in Section 2.12(b).
Β
βOtis Certificate of Incorporationβ shall mean the Amended and Restated Certificate of Incorporation of Otis, substantially in the form of Exhibit C.
Β
βOtis Contractsβ shall mean the following contracts and agreements to which any of the Parties or any member of their respective Groups is a party or by which any of the Parties or any member of
their respective Groups or any of their respective Assets is bound, whether or not in writing (provided that Otis Contracts shall not include (x)Β any contract or agreement that is contemplated to be retained by UTC or any member of the UTC
Group from and after the Effective Time pursuant to any provision of this Agreement or any Ancillary Agreement or (y)
Β
-11-
any contract or agreement that is contemplated to be a Carrier Contract from and after the Effective Time pursuant to any provision of this Agreement or any Ancillary Agreement):
Β
(a)Β Β Β Β Β Β Β Β Β Β (i) any customer or distribution contract or agreement with a Third Party entered into prior to the Effective Time primarily related to the Xxxx
Business and (ii)Β with respect to any customer or distribution contract or agreement with a Third Party entered into prior to the Effective Time that relates to the Xxxx Business but is not primarily related to the Xxxx Business, that portion of
any such customer or distribution contract or agreement that relates to the Xxxx Business;
Β
(b)Β Β Β Β Β Β Β Β Β Β (i) any supply or vendor contract or agreement with a Third Party entered into prior to the Effective Time exclusively related to the Xxxx Business
and (ii)Β with respect to any supply or vendor contract or agreement with a Third Party entered into prior to the Effective Time that relates to the Xxxx Business but is not exclusively related to the Xxxx Business, that portion of any such supply
or vendor contract or agreement that relates to the Xxxx Business;
Β
(c)Β Β Β Β Β Β Β Β Β Β (i) any license agreement entered into prior to the Effective Time primarily related to the Xxxx Business and (ii) with respect to any license agreement entered into prior to the
Effective Time that relates to the Xxxx Business but is not primarily related to the Xxxx Business, that portion of any such license agreement that relates to the Xxxx Business;
Β
(d)Β Β Β Β Β Β Β Β Β Β any guarantee, indemnity, representation, covenant, warranty or other contractual Liability of any of the Parties or any member of their respective Groups to the extent in respect of any
other Otis Contract or Otis Liability or the Xxxx Business;
Β
(e)Β Β Β Β Β Β Β Β Β Β any contract or agreement that is expressly contemplated pursuant to this Agreement or any of the Ancillary Agreements to be assigned to Otis or any member of the Otis Group;
Β
(f)Β Β Β Β Β Β Β Β Β Β any credit agreement, indenture, note or other financing agreement or instrument entered into by Otis and/or any member of the Otis Group in connection
with the Separation, including any Otis Financing Arrangements;
Β
(g)Β Β Β Β Β Β Β Β Β Β any other contract or agreement not otherwise set forth herein and primarily related to the Xxxx Business or Otis Assets;
Β
(h)Β Β Β Β Β Β Β Β Β Β any employment, change of control, retention, consulting, indemnification, termination, severance or other similar agreements with (i) any Otis Group Employee (as defined in the Employee
Matters Agreement) or (ii) any consultant of the Otis Group (if such agreement is primarily related to the Xxxx Business or Otis Assets) that is in effect as of the Effective Time; and
Β
(i)Β Β Β Β Β Β Β Β Β Β any contracts, agreements or settlements set forth on Schedule 1.5, including the right to recover any amounts under such contracts, agreements or settlements.
Β
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βOtis Contributionβ shall have the meaning set forth in the Recitals.
Β
βOtis Designeesβ shall mean any and all entities (including corporations, general or limited
partnerships, trusts, joint ventures, unincorporated organizations, limited liability entities or other entities) designated by UTC that will be members of the Otis Group as of immediately prior to the Effective Time.
Β
βOtis Disclosure Documentβ shall mean the Otis Form 10, the Otis Information Statement and any other registration statement, prospectus, offering memorandum, offering circular, periodic report,
proxy statement or similar disclosure document, whether or not filed with the SEC and whether or not filed with any other Governmental Authority, in each case, (a) filed, distributed or otherwise made available by or on behalf of Otis or any member
of the Otis Group or (b) that primarily relates to the transactions with respect to Otis contemplated hereby.
Β
βOtis Distributionβ shall have the meaning set forth in the Recitals.
Β
βOtis Distribution Dateβ shall mean the date of the consummation of the Otis Distribution, which shall be determined by the UTC Board in its sole and absolute discretion.
Β
βOtis Distribution Ratioβ shall mean a number equal to one-half (1/2).
Β
βOtis Effective Timeβ shall mean 12:01 a.m., New York City time, on the Otis Distribution Date.
Β
βOtis Financing Arrangementsβ shall have the meaning set forth in Section 2.12(b).
Β
βOtis Form 10β shall mean the registration statement on Form 10 filed by Otis with the SEC to effect the registration of Otis Shares pursuant to the Exchange Act in connection with the Otis
Distribution, as such registration statement may be amended or supplemented from time to time prior to the Otis Distribution.
Β
βOtis Groupβ shall mean (a) prior to the Effective Time, Otis and each Person that will be a Subsidiary of Xxxx as of immediately after the Effective Time, including the Otis Transferred Entities
and their respective Subsidiaries, even if, prior to the Effective Time, such Person is not a Subsidiary of Otis and (b) on and after the Effective Time, Otis and each Person that is a Subsidiary of Otis.
Β
βOtis Indemniteesβ shall have the meaning set forth in Section 4.2.
Β
βOtis Information Statementβ shall mean the information statement to be made available to the holders of UTC Shares in connection with the Otis Distribution, as such information statement may be
amended or supplemented from time to time prior to the Otis Distribution.
Β
βOtis Intellectual Property Rightsβ shall mean (a) all Intellectual Property Rights owned by Otis or any member of the Otis Group as of immediately prior to the Effective Time, except for all
Intellectual Property Rights to be assigned from Otis or any member of the Otis
Β
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Group to UTC, Carrier, any member of the UTC Group or any member of the Carrier Group pursuant to Section 2.1 of the Intellectual Property Agreement, (b) all Intellectual Property Rights to be assigned from UTC, Carrier,
any member of the UTC Group or any member of the Carrier Group to Otis or any member of the Otis Group pursuant to Section 2.1 of the Intellectual Property Agreement and (c) rights to bring claims or seek damages for infringement of the
Intellectual Property Rights described in the foregoing clauses (a) and (b) against or from a Third Party.
Β
βOtis Liabilitiesβ shall have the meaning set forth in Section 2.3(b).
Β
βOtis Permitsβ shall mean all Permits owned or licensed by any of the Parties or any member of their respective Groups used or held for use solely or primarily in the Xxxx Business immediately
prior to the Effective Time.
Β
βOtis Record Dateβ shall mean the close of business on the date determined by the UTC Board as the record date for determining holders of UTC Shares entitled to receive Otis Shares pursuant to
the Otis Distribution.
Β
βOtis Separationβ shall have the meaning set forth in the Recitals.
Β
βOtis Sharesβ shall mean the shares of common stock, par value $0.01 per share, of Otis.
Β
βOtis Technologyβ shall mean all Technology that is used or held for use in the Xxxx Business as of
immediately prior to the Effective Time, the Intellectual Property Rights with respect to which are owned by any of the Parties or any member of their respective Groups as of immediately prior to the Effective Time.
Β
βOtis Transferred Entitiesβ shall mean the entities set forth on Schedule
1.6.Β
Β
βPartiesβ shall mean the parties to this Agreement.
Β
βPermitsβ shall mean permits, approvals, authorizations, consents, licenses or certificates issued by any Governmental Authority.
Β
βPersonβ shall mean an individual, a general or limited partnership, a corporation, a trust, a joint venture, an unincorporated organization, a limited liability entity, any other entity or any
Governmental Authority.
Β
βPlan of Reorganizationβ shall mean the plan and structure set forth on Schedule 2.1(a).
Β
βPrime Rateβ shall mean the rate that Bloomberg displays as βPrime Rate by Country United Statesβ or βPrime Rate by Country US-BB Compβ atΒ xxxx://xxx.xxxxxxxxx.xxx/xxxxx/XXXXX:XXX
or on a Bloomberg terminal at PRIMBB Index.
Β
βPrivileged Informationβ shall mean any Information, including any communications by or to attorneys (including attorney-client privileged communications),
Β
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memoranda and other materials prepared by attorneys or under their direction (including attorney work product), as to which a Party or any member of its Group would be entitled to assert or have asserted a privilege or other protection,
including the attorney-client and attorney work product privileges.
Β
βReceiving Memberβ shall have the meaning set forth in Section 2.4(c).
Β
βRecord Dateβ shall mean the Carrier Record Date or the Otis Record Date, as applicable.
Β
βRecord Holdersβ shall mean the holders of record of UTC Shares as of the applicable Record Date.
Β
βReleaseβ shall mean any release, spill, emission, discharge, leaking, pumping, pouring, dumping, injection, deposit, disposal, dispersal, leaching or migration of Hazardous Materials into the
environment (including ambient air, surface water, groundwater and surface or subsurface strata).
Β
βRepresentativesβ shall mean, with respect to any Person, any of such Personβs directors, officers, employees, agents, consultants, advisors, accountants, attorneys or other representatives.
Β
βSECβ shall mean the U.S. Securities and Exchange Commission.
Β
βSecond Distributionβ shall mean, in the event the Carrier Effective Time and the Otis Effective Time do not occur at the same time, the second to occur of the Carrier Distribution and the Otis
Distribution.
Β
βSecond Effective Timeβ shall mean, in the event the Carrier Effective Time and the Otis Effective Time do not occur at the same time, the second to occur of the Carrier Effective Time and the
Otis Effective Time.
Β
βSecurity Interestβ shall mean 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.
Β
βSeparationβ shall have the meaning set forth in the Recitals.
Β
βShared Contractβ shall have the meaning set forth in Section 2.8(a).
Β
βSpecified Ancillary Agreementβ shall have the meaning set forth in Section 10.19(a).
Β
βStraddle Periodβ shall have the meaning set forth in Section 2.13(a).
Β
βSubsidiaryβ shall mean, with respect to any Person, any corporation, limited liability company, joint venture, partnership or other entity of which such Person (a)Β beneficially
Β
-15-
owns, either directly or indirectly, more than fifty percent (50%) of (i) the total combined voting power of all classes of voting securities, (ii) the total combined equity interests or (iii) the capital or profit
interests, in the case of a partnership, or (b) otherwise has (i) the power to vote, either directly or indirectly, sufficient securities to elect a majority of the board of directors or similar governing body or (ii) the power to vote, either
directly or indirectly, sufficient securities to elect half of the board of directors or similar governing body and a casting vote with respect to decisions of such board of directors or similar governing body.
Β
βTangible Informationβ shall mean Information that is contained in written, electronic or other tangible forms.
Β
βTaxβ shall have the meaning set forth in the Tax Matters Agreement.
Β
βTax Matters Agreementβ shall mean the Tax Matters Agreement to be entered into by and among UTC, Carrier and Otis in connection with the Separation, the Distributions and the other transactions
contemplated by this Agreement, as it may be amended from time to time.
Β
βTechnologyβ shall mean embodiments, regardless of form, of Intellectual Property Rights, including, as the context requires, inventions (whether or not patentable), discoveries and improvements, works of
authorship, documentation, diagrams, formulae, APIs, software (whether in source code or in executable code form), user interfaces, architectures, databases, data compilations and collections, know-how, technical data, mask works, models,
prototypes, molds, methods, protocols, techniques, processes, devices, schematics, algorithms and molds, and embodiments of Trade Secrets; provided that Technology specifically excludes any and all Intellectual Property Rights.
Β
βThird Partyβ shall mean any Person other than the Parties or any members of their respective Groups.
Β
βThird-Party Claimβ shall have the meaning set forth in Section 4.6(a).
Β
βTrade Secretsβ shall have the meaning set forth in the Intellectual Property Agreement.
Β
βTransfer Documentsβ shall have the meaning set forth in Section 2.1(b).
Β
βTransition Committeeβ shall have the meaning set forth in Section 2.14.
Β
βTransition Services Agreementβ shall mean the Transition Services Agreement to be entered into by and among UTC, Carrier and Otis or any member of their respective Group in connection with the
Separation, the Distributions or the other transactions contemplated by this Agreement, as it may be amended from time to time.
Β
βUnreleased Liabilityβ shall have the meaning set forth in Section 2.5(b).
Β
βUTCβ shall have the meaning set forth in the Preamble.
Β
-16-
βUTC Accountsβ shall mean each bank or brokerage account, and all contracts or agreements governing each bank or brokerage account, owned by any of the Parties or any members of their respective
Groups other than Carrier Accounts and Otis Accounts.
Β
βUTC Assetsβ shall have the meaning set forth in Section 2.2(c).
Β
βUTC Boardβ shall have the meaning set forth in the Recitals.
Β
βUTC Businessβ shall mean all businesses, operations and activities (whether or not such businesses, operations or activities are or have been terminated, divested or discontinued) conducted at
any time prior to the Effective Time by any of the Parties or their respective current or former Subsidiaries, other than the Carrier Business and the Otis Business.
Β
βUTC Captive Entityβ shall mean UT Insurance (Vermont) Inc. and any other insurer owned or controlled by UTC at any time prior to the applicable Effective Time, other than the Carrier Captive
Subsidiaries and the Otis Captive Subsidiaries.
Β
βUTC Disclosure Documentβ shall mean any registration statement, prospectus, offering memorandum, offering circular, periodic report, proxy statement or similar disclosure document, whether or
not filed with the SEC and whether or not filed with any other Governmental Authority, in each case filed, distributed or otherwise made available by or on behalf of UTC or any member of the UTC Group.
Β
βUTC Groupβ shall mean UTC and each Person that is a Subsidiary of UTC (other than Carrier and Otis and any other member of the Carrier Group or the Otis Group).
Β
βUTC Indemniteesβ shall have the meaning set forth in Section 4.2.
Β
βUTC Intellectual Property Rightsβ shall mean all Intellectual Property Rights owned by any of the Parties or any member of their respective Groups as of immediately prior to the Effective Time,
other than Otis Intellectual Property Rights and Carrier Intellectual Property Rights.
Β
βUTC Liabilitiesβ shall have the meaning set forth in Section 2.3(c).
Β
βUTC Sharesβ shall mean the shares of common stock, par value $1.00 per share, of UTC.
Β
βUTC Technologyβ shall mean all Technology that is used or held for use in the UTC Business as of
immediately prior to the Effective Time, the Intellectual Property Rights with respect to which are owned by any of the Parties or any member of their respective Groups as of immediately prior to the Effective Time.
Β
βUTC Trademarksβ shall have the meaning set forth in the Intellectual Property Agreement.
Β
-17-
ARTICLE II
THE SEPARATION
THE SEPARATION
Β
2.1Β Β Β Β Β Β Β Β Β Β Transfer of Assets and Assumption of Liabilities.
Β
(a)Β Β Β Β Β Β Β Β Β Β On or prior to the Effective Time, in accordance with the plan and structure set forth in the Plan of Reorganization:
Β
(i)Β Β Β Β Β Β Β Β Β Β Transfer and Assignment of Carrier Assets.Β UTC and Otis shall, and shall cause the applicable
members of their respective Groups to, contribute, assign, transfer, convey and deliver to Carrier, or the applicable Carrier Designees, and Carrier or such Carrier Designees shall accept from UTC, Otis, any member of the UTC Group or any member
of the Otis Group, as applicable, all of such Personβs respective direct or indirect right, title and interest in and to all of the Carrier Assets (it being understood that if any Carrier Asset shall be held by a Carrier Transferred Entity or a
wholly owned Subsidiary of a Carrier Transferred Entity, such Carrier Asset shall be deemed assigned, transferred, conveyed and delivered to Carrier as a result of the transfer of all of UTCβs and Otisβs and any member of their respective Groupβs
(as applicable) equity interests in such Carrier Transferred Entity from UTC, Otis, such member of the UTC Group and/or such member of the Otis Group, as applicable, to Carrier or the applicable Carrier Designee);
Β
(ii)Β Β Β Β Β Β Β Β Β Β Acceptance and Assumption of Carrier Liabilities.Β Carrier and the applicable Carrier Designees
shall accept, assume and agree faithfully to perform, discharge and fulfill all the Carrier Liabilities in accordance with their respective termsΒ (it being understood that if any Carrier Liability is a liability of a Carrier Transferred Entity
or a wholly owned Subsidiary of a Carrier Transferred Entity, such Carrier Liability may be assumed by Carrier as a result of the transfer of all of UTCβs and Otisβs and any member of their respective Groupβs (as applicable) equity interests in
such Carrier Transferred Entity from UTC, Otis, such member of the UTC Group and/or such member of the Otis Group, to Carrier or the applicable Carrier Designee).Β Carrier and such Carrier Designees shall be responsible for all Carrier
Liabilities, regardless of when or where such Carrier Liabilities arose or arise, or whether the facts on which they are based occurred prior to or subsequent to the Effective Time, regardless of where or against whom such Carrier Liabilities are
asserted or determined (including any Carrier Liabilities arising out of claims made by UTCβs, Otisβs or Carrierβs respective directors, officers, employees, agents, Subsidiaries or Affiliates against any member of the UTC Group, the Otis Group
or the Carrier Group) or whether asserted or determined prior to the date hereof, and regardless of whether arising from or alleged to arise from negligence, recklessness, violation of Law, fraud or misrepresentation by any member of the UTC
Group, the Otis Group or the Carrier Group, or any of their respective directors, officers, employees, agents, Subsidiaries or Affiliates;
Β
(iii)Β Β Β Β Β Β Β Β Β Β Transfer and Assignment of Otis Assets.Β UTC and Carrier shall, and shall cause the applicable
members of their respective Groups to, contribute, assign, transfer, convey and deliver to Otis, or the applicable Otis Designees, and Otis or such Otis Designees shall accept from UTC, Carrier, any member of the UTC Group or the
Β
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member of the Carrier Group, as applicable, such Personβs respective direct or indirect right, title and interest in and to all of the Otis Assets (it being understood that if any Otis Asset shall be
held by an Otis Transferred Entity or a wholly owned Subsidiary of an Otis Transferred Entity, such Otis Asset shall be deemed assigned, transferred, conveyed and delivered to Xxxx as a result of the transfer of all of UTCβs and Carrierβs and any
member of their respective Groupβs (as applicable) equity interests in such Otis Transferred Entity from UTC, Carrier, any member of the UTC Group and/or any member of the Carrier Group, as applicable, to Otis or the applicable Otis Designee);
Β
(iv)Β Β Β Β Β Β Β Β Β Β Acceptance and Assumption of Otis Liabilities.Β Otis and the applicable Otis Designees shall
accept, assume and agree faithfully to perform, discharge and fulfill all the Otis Liabilities in accordance with their respective terms (it being understood that if any Otis Liability is a liability of an Otis Transferred Entity or a wholly
owned Subsidiary of an Otis Transferred Entity, such Otis Liability may be assumed by Xxxx as a result of the transfer of all of UTCβs and Carrierβs and any member of their respective Groupβs (as applicable) equity interests in such Otis
Transferred Entity from UTC, Carrier, such member of the UTC Group and/or such member of the Carrier Group, to Otis or the applicable Otis Designee).Β Otis and such Otis Designees shall be responsible for all Otis Liabilities, regardless of when
or where such Otis Liabilities arose or arise, or whether the facts on which they are based occurred prior to or subsequent to the Effective Time, regardless of where or against whom such Otis Liabilities are asserted or determined (including any
Otis Liabilities arising out of claims made by UTCβs, Carrierβs or Otisβs respective directors, officers, employees, agents, Subsidiaries or Affiliates against any member of the UTC Group, the Carrier Group or the Otis Group) or whether asserted
or determined prior to the date hereof, and regardless of whether arising from or alleged to arise from negligence, recklessness, violation of Law, fraud or misrepresentation by any member of the UTC Group, the Carrier Group or the Otis Group, or
any of their respective directors, officers, employees, agents, Subsidiaries or Affiliates;
Β
(v)Β Β Β Β Β Β Β Β Β Β Transfer and Assignment of UTC Assets.Β Otis and Carrier, respectively shall, and UTC shall cause
Carrier and the Carrier Designees and Otis and the Otis Designees to contribute, assign, transfer, convey and deliver to UTC or certain members of the UTC Group designated by UTC, and UTC or such other members of the UTC Group shall accept from
Carrier, the Carrier Designees, Otis or the Otis Designees, as applicable, each of such Personβs respective direct or indirect right, title and interest in and to all UTC Assets held by Carrier, a Carrier Designee, Otis or an Otis Designee; and
Β
(vi)Β Β Β Β Β Β Β Β Β Β Acceptance and Assumption of UTC Liabilities.Β UTC and certain members of the UTC Group designated
by UTC shall accept and assume and agree faithfully to perform, discharge and fulfill all of the UTC Liabilities held by Carrier, any Carrier Designee, Otis or any Otis Designee, and UTC and the applicable members of the UTC Group shall be
responsible for all UTC Liabilities in accordance with their respective terms, regardless of when or where such UTC Liabilities arose or arise, or whether the facts on which they are based occurred prior to or subsequent to the Effective Time,
regardless of where or against whom such UTC Liabilities are asserted or determined (including any such UTC Liabilities arising out of claims made by UTCβs,
Β
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Carrierβs or Otisβs respective directors, officers, employees, agents, Subsidiaries or Affiliates against any member of the UTC Group, the Carrier Group or the Otis Group) or whether asserted or
determined prior to the date hereof, and regardless of whether arising from or alleged to arise from negligence, recklessness, violation of Law, fraud or misrepresentation by any member of the UTC Group, the Carrier Group or the Otis Group, or any
of their respective directors, officers, employees, agents, Subsidiaries or Affiliates.
Β
(b)Β Β Β Β Β Β Β Β Β Β Transfer Documents.Β In furtherance of the contribution, assignment, transfer, conveyance and delivery of the Assets
and the assumption of the Liabilities in accordance with Section 2.1(a), and without prejudice to any actions taken to implement, or documents entered into between
or among any of the Parties or members of their respective Groups to implement or in furtherance of, the Plan of Reorganization prior to the date hereof, (i)Β each Party shall execute and deliver, and shall cause the applicable members of its
Group to execute and deliver, to the applicable other Party, such bills of sale, quitclaim deeds, 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 such Partyβs and the applicable members of its Groupβs right, title and interest in and to such Assets to the applicable other Party and the applicable members of its Group
in accordance with Section 2.1(a); and (ii) each Party shall execute and deliver, and shall cause the applicable members of its Group to execute and deliver, to the
applicable other Party, such assumptions of contracts and other instruments of assumption as and to the extent necessary to evidence the valid and effective assumption of the Liabilities by such Party and the applicable members of its Group in
accordance with Section 2.1(a).Β All of the foregoing documents contemplated by this Section 2.1(b) (including any documents entered into between or among any of the Parties or members of their respective Groups to implement or in furtherance of the Plan of Reorganization prior to the date hereof) shall be referred to
collectively herein as the βTransfer Documents.β
Β
(c)Β Β Β Β Β Β Β Β Β Β Misallocations.Β In the event that at any time or from time to time (whether prior to, at or after the Effective
Time), one Party (or any member of such Partyβs Group) shall receive or otherwise possess any Asset that is allocated to another Party (or any member of such Partyβs Group) pursuant to this Agreement or any Ancillary Agreement, such Party shall
promptly transfer, or cause to be transferred, such Asset to the Party so entitled thereto (or to any member of such Partyβs Group), and such Party (or any member of such Partyβs Group) so entitled thereto shall accept such Asset.Β Prior to any
such transfer, the Person receiving or possessing such Asset shall hold such Asset in trust for such other Person.Β In the event that at any time or from time to time (whether prior to, at or after the Effective Time), one Party hereto (or any
member of such Partyβs Group) shall receive or otherwise assume any Liability that is allocated to another Party (or any member of such Partyβs Group) pursuant to this Agreement or any Ancillary Agreement, such other Party shall promptly
transfer, or cause to be transferred, such Liability to the Party responsible therefor (or to any member of such Partyβs Group), and such Party (or any member of such Partyβs Group) responsible therefor shall accept, assume and agree to
faithfully perform such Liability.
Β
(d)Β Β Β Β Β Β Β Β Β Β Waiver of Bulk-Sale and Bulk-Transfer Laws.Β To the extent permissible under applicable Law, each of Carrier and Otis
hereby waives compliance by each and every
Β
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member of the UTC Group and, in the case of Carrier, the Otis Group, and in the case of Otis, the Carrier Group, with the requirements and provisions of any βbulk-saleβ or βbulk-transferβ Laws of any jurisdiction that may
otherwise be applicable with respect to the transfer or sale of any or all of the Carrier Assets or Otis Assets to any member of the Carrier Group or the Otis Group, respectively.Β To the extent permissible under applicable Law, UTC hereby waives
compliance by each and every member of the Carrier Group and the Otis Group with the requirements and provisions of any βbulk-saleβ or βbulk-transferβ Laws of any jurisdiction that may otherwise be applicable with respect to the transfer or sale of
any or all of the UTC Assets to any member of the UTC Group.
Β
2.2Β Β Β Β Β Β Β Β Β Β Carrier Assets; Otis Assets; UTC Assets.
Β
(a)Β Β Β Β Β Β Β Β Β Β Carrier Assets.Β For purposes of this Agreement, βCarrier Assetsβ shall mean:
Β
(i)Β Β Β Β Β Β Β Β Β Β all issued and outstanding capital stock or other equity interests of the Carrier Transferred Entities and their respective Subsidiaries that are owned by
any of the Parties or any member of their respective Groups as of the Effective Time;
Β
(ii)Β Β Β Β Β Β Β Β Β Β all Assets (other than cash and cash equivalents) of any of the Parties or any member of their respective Groups included or reflected as assets of the
Carrier Group on the Carrier Balance Sheet, subject to any dispositions of such Assets subsequent to the date of the Carrier Balance Sheet; provided, that the
amounts set forth on the Carrier Balance Sheet with respect to any Assets shall not be treated as minimum amounts or limitations on the amount of such Assets that are included in the definition of Carrier Assets pursuant to this clause (ii);
Β
(iii)Β Β Β Β Β Β Β Β Β Β all Assets (other than cash and cash equivalents) of any of the Parties or any member of their respective Groups as of the Effective Time that are of a
nature or type that would have resulted in such Assets being included as Assets of Carrier or members of the Carrier Group on a pro forma combined balance sheet of the Carrier Group or any notes or subledgers thereto as of the Effective Time
(were such balance sheet, notes and subledgers to be prepared on a basis consistent with the determination of the Assets included on the Carrier Balance Sheet), it being understood that (A) the Carrier Balance Sheet shall be used to determine the
types of, and methodologies used to determine, those Assets that are included in the definition of Carrier Assets pursuant to this clause (iii); and (B) the amounts set forth on the Carrier Balance Sheet with respect to any Assets shall not be
treated as minimum amounts or limitations on the amount of such Assets that are included in the definition of Carrier Assets pursuant to this clause (iii);
Β
(iv)Β Β Β Β Β Β Β Β Β Β all Assets of any of the Parties or any member of their respective Groups as of the Effective Time that are expressly provided by this Agreement or any
Ancillary Agreement as Assets to be transferred to Carrier or any other member of the Carrier Group;
Β
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(v)Β Β Β Β Β Β Β Β Β Β all Carrier Contracts as of the Effective Time and all rights, interests or claims of any of the Parties or any members of their respective Groups
thereunder as of the Effective Time;
Β
(vi)Β Β Β Β Β Β Β Β all Carrier Intellectual Property Rights and Carrier Technology as of the Effective Time and all rights, interests or claims of any of the Parties or any
member of their respective Groups thereunder as of the Effective Time;
Β
(vii)Β Β Β Β Β Β all Carrier Permits as of the Effective Time and all rights, interests or claims of any of the Parties or any members of their respective Groups thereunder
as of the Effective Time;
Β
(viii)Β Β Β Β Β (A) all rights, interests and claims (other than those set forth in Section 2.2(b)(viii)(B)) of any of the Parties or any members of their respective Groups as of the Effective Time with respect to Information that is solely or primarily related to the Carrier Assets, the Carrier Liabilities, the Carrier
Business or the Carrier Transferred Entities or their respective Subsidiaries and (B) subject to the provisions of the applicable Ancillary Agreements, a non-exclusive right to all Information of any of the Parties or any members of their
respective Groups as of the Effective Time that is related to, but not solely or primarily related to, the Carrier Assets, the Carrier Liabilities, the Carrier Business or the Carrier Transferred Entities or their respective Subsidiaries;
Β
(ix)Β Β Β Β Β Β Β any and all Assets (A) set forth on Schedule 2.2(a)(ix)(A) or (B) of any
Carrier Captive Subsidiary;
Β
(x)Β Β Β Β Β Β Β Β any and all Assets set forth on Schedule 2.2(a)(x);
Β
(xi)Β Β Β Β Β Β Β subject to Section 2.9(d), all cash and cash equivalents held as of the
Effective Time in bank or brokerage accounts owned exclusively by Carrier or any member of its Group; and
Β
(xii)Β Β Β Β Β Β all other Assets of any of the Parties or any member of their respective Groups as of the Effective Time that are used or held for use solely or primarily
in the Carrier Business to the extent the category of such Asset is not already covered by subclauses (i)β(xi) of this subsection.
Β
Notwithstanding the foregoing, the Carrier Assets shall not in any event include any Asset referred to in Section 2.2(b) or clauses (i) through (vii) of Section 2.2(c).
Β
(b)Β Β Β Β Β Β Β Β Β Β Otis Assets.Β For purposes of this Agreement, βOtis Assetsβ shall mean:
Β
(i)Β Β Β Β Β Β Β Β Β Β all issued and outstanding capital stock or other equity interests of the Otis Transferred Entities and their respective Subsidiaries that are owned by any
of the Parties or any member of their respective Groups as of the Effective Time;
Β
(ii)Β Β Β Β Β Β Β Β all Assets (other than cash and cash equivalents) of any of the Parties or any member of their respective Groups included or reflected as assets of the
Otis Group on the Otis Balance Sheet, subject to any dispositions of such Assets
Β
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subsequent to the date of the Otis Balance Sheet; provided, that the amounts set forth on the Otis Balance Sheet with respect to any Assets shall not be treated as minimum amounts or limitations
on the amount of such Assets that are included in the definition of Otis Assets pursuant to this clause (ii);
Β
(iii)Β Β Β Β Β Β Β all Assets (other than cash and cash equivalents) of any of the Parties or any member of their respective Groups as of the Effective Time that are of a
nature or type that would have resulted in such Assets being included as Assets of Otis or members of the Otis Group on a pro forma combined balance sheet of the Otis Group or any notes or subledgers thereto as of the Effective Time (were such
balance sheet, notes and subledgers to be prepared on a basis consistent with the determination of the Assets included on the Otis Balance Sheet), it being understood that (A) the Otis Balance Sheet shall be used to determine the types of, and
methodologies used to determine, those Assets that are included in the definition of Otis Assets pursuant to this clause (iii); and (B) the amounts set forth on the Otis Balance Sheet with respect to any Assets shall not be treated as minimum
amounts or limitations on the amount of such Assets that are included in the definition of Otis Assets pursuant to this clause (iii);
Β
(iv)Β Β Β Β Β Β Β all Assets of any of the Parties or any member of their respective Groups as of the Effective Time that are expressly provided by this Agreement or any
Ancillary Agreement as Assets to be transferred to Otis or any other member of the Otis Group;
Β
(v)Β Β Β Β Β Β Β Β all Otis Contracts as of the Effective Time and all rights, interests or claims of any of the Parties or any member of their respective Groups thereunder as
of the Effective Time;
Β
(vi)Β Β Β Β Β Β Β all Otis Intellectual Property Rights and Xxxx Technology as of the Effective Time and all rights, interests or claims of any of the Parties or any member
of their respective Groups thereunder as of the Effective Time;
Β
(vii)Β Β Β Β Β Β all Otis Permits as of the Effective Time and all rights, interests or claims of any of the Parties or any member of their respective Groups thereunder as
of the Effective Time;
Β
(viii)Β Β Β Β Β (A) all rights, interests and claims (other than those set forth in Section 2.2(a)(viii)(B)) of any of the Parties or any member of their respective Groups as of the Effective Time with respect to Information that is primarily related to the Otis Assets, the Otis Liabilities, the Xxxx Business or the Otis
Transferred Entities or their respective Subsidiaries and (B) subject to the provisions of the applicable Ancillary Agreements, a non-exclusive right to all Information of any of the Parties or any members of their respective Groups as of the
Effective Time that is related to, but not solely or primarily related to, the Otis Assets, the Otis Liabilities, the Xxxx Business or the Otis Transferred Entities or their respective Subsidiaries;
Β
(ix)Β Β Β Β Β Β Β any and all Assets (A) set forth on Schedule 2.2(b)(ix)(A) or (B) of any
Otis Captive Subsidiary;
Β
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(x)Β Β Β Β Β Β Β Β any and all Assets set forth on Schedule 2.2(b)(x);
Β
(xi)Β Β Β Β Β Β Β subject to Section 2.9(d), all cash and cash equivalents held as of the
Effective Time in bank or brokerage accounts owned exclusively by Otis or any member of its Group; and
Β
(xii)Β Β Β Β Β Β all other Assets of any of the Parties or any member of their respective Groups as of the Effective Time that are used or held for use solely or primarily
in the Xxxx Business to the extent the category of such Asset is not already covered by subclauses (i)β(xi) of this subsection.
Β
Notwithstanding the foregoing, the Otis Assets shall not in any event include any Asset referred to in Section 2.2(a) or clauses (i) through (vii) of Section 2.2(c).
Β
(c)Β Β Β Β Β Β Β Β Β Β UTC Assets.Β For the purposes of this Agreement, βUTC Assetsβ shall mean all Assets of any of the Parties or any member of their respective Groups as of the Effective Time, other than the Carrier Assets and Otis Assets, it being understood that, notwithstanding anything herein to
the contrary, the UTC Assets shall include:
Β
(i)Β Β Β Β Β Β Β Β Β Β all Assets that are contemplated by this Agreement or any Ancillary Agreement (or the Schedules hereto or thereto) as Assets to be retained by UTC or any
other member of the UTC Group;
Β
(ii)Β Β Β Β Β Β Β Β (A) the UTC Trademarks and (B) all UTC Intellectual Property Rights and UTC Technology as of the Effective Time and all rights, interests or claims of any
of the Parties or any member of their respective Groups thereunder as of the Effective Time;
Β
(iii)Β Β Β Β Β Β Β all Permits of any of the Parties or any member of their respective Groups as of the Effective Time other than the Carrier Permits and the Otis Permits;
Β
(iv)Β Β Β Β Β Β Β (A) all rights, interests and claims (other than the rights, interests and claims set forth in Sections
2.2(a)(viii)(A), 2.2(a)(viii)(B), 2.2(b)(viii)(A) and 2.2(b)(viii)(B)) of any of the Parties or any member of their respective Groups as of the Effective Time with respect to Information and (B) subject
to the provisions of the applicable Ancillary Agreements, a nonexclusive right to all Information described in Sections 2.2(a)(viii)(A) and 2.2(b)(viii)(A) that is related, but not solely or primarily related, to the UTC Assets, the UTC Liabilities or the UTC Business;
Β
(v)Β Β Β Β Β Β Β Β all proceeds from, and all other rights, interests and claims in or pursuant to, any settlement of claims entered into by any of the Parties or any member
of their respective Groups at any time prior to the Effective Time under any insurance policy or insurance policy-related contract, other than the Assets referred to in Sections 2.2(a)(ix),Β 2.2(a)(x), 2.2(b)(ix) and 2.2(b)(x);
Β
(vi)Β Β Β Β Β Β Β all cash or cash equivalents of any of the Parties or any member of their respective Groups as of the Effective Time other than the cash or cash equivalents
described in Sections 2.2(a)(xi) and 2.2(b)(xi); and
Β
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(vii)Β Β Β Β Β Β any and all Assets set forth on Schedule 2.2(c).
Β
2.3Β Β Β Β Β Β Β Β Β Β Carrier Liabilities; Otis Liabilities; UTC Liabilities.
Β
(a)Β Β Β Β Β Β Β Β Β Β Carrier Liabilities.Β For the purposes of this Agreement, βCarrier Liabilitiesβ shall mean the following Liabilities of any of the Parties or any members of their respective Groups:
Β
(i)Β Β Β Β Β Β Β Β Β Β all Liabilities included or reflected as liabilities or obligations of Carrier or the members of the Carrier Group on the Carrier Balance Sheet, subject to
any discharge of such Liabilities subsequent to the date of the Carrier Balance Sheet; provided, that the amounts set forth on the Carrier Balance Sheet with
respect to any Liabilities shall not be treated as minimum amounts or limitations on the amount of such Liabilities that are included in the definition of Carrier Liabilities pursuant to this clause (i);
Β
(ii)Β Β Β Β Β Β Β Β all Liabilities as of the Effective Time that are of a nature or type that would have resulted in such Liabilities being included or reflected as
liabilities or obligations of Carrier or the members of the Carrier Group on a pro forma combined balance sheet of the Carrier Group or any notes or subledgers thereto as of the Effective Time (were such balance sheet, notes and subledgers to be
prepared on a basis consistent with the determination of the Liabilities included on the Carrier Balance Sheet), it being understood that (B) the Carrier Balance Sheet shall be used to determine the types of, and methodologies used to determine,
those Liabilities that are included in the definition of Carrier Liabilities pursuant to this clause (ii); and (B) the amounts set forth on the Carrier Balance Sheet with respect to any Liabilities shall not be treated as minimum amounts or
limitations on the amount of such Liabilities that are included in the definition of Carrier Liabilities pursuant to this clause (ii);
Β
(iii)Β Β Β Β Β Β Β all Liabilities arising out of any matter set forth on Schedule 2.3(a)(iii);
Β
(iv)Β Β Β Β Β Β Β all Liabilities relating to, arising out of or resulting from the actions, inactions, events, omissions, conditions, facts or circumstances occurring or
existing prior to the Effective Time (whether or not such Liabilities cease being contingent, mature, become known, are asserted or foreseen, or accrue, in each case before, at or after the Effective Time), in each case to the extent that such
Liabilities relate to, arise out of or result from the conduct of the Carrier Business or a Carrier Asset, including all Liabilities relating to, arising out of or resulting from any matter set forth on Schedule
2.3(a)(iv);
Β
(v)Β Β Β Β Β Β Β Β any and all Liabilities that are expressly provided by this Agreement or any Ancillary Agreement (or the Schedules hereto or thereto) as Liabilities to be
assumed by Carrier or any other member of the Carrier Group, and all agreements, obligations and Liabilities of any member of the Carrier Group under this Agreement or any of the Ancillary Agreements;
Β
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(vi)Β Β Β Β Β Β Β any and all Liabilities (A) of any UTC Captive Entity or that are or have been transferred from a UTC Captive Entity to any Third-Party insurer, in each
case to the extent that such Liabilities relate to, arise out of or result from the conduct of the Carrier Business or a Carrier Asset and (B) of any Carrier Captive Subsidiary (the βCarrier Captive
Liabilitiesβ);
Β
(vii)Β Β Β Β Β Β all Liabilities to the extent relating to, arising out of or resulting from the Carrier Contracts, the Carrier Intellectual Property Rights, the Carrier
Technology, the Carrier Permits or the Carrier Financing Arrangements; and
Β
(viii)Β Β Β Β Β Β all Liabilities arising out of litigation or other claims (including in respect of Environmental Liabilities or asbestos Liabilities) made by any Third
Party (including UTCβs, Otisβs or Carrierβs respective directors, officers, stockholders, employees and agents) against, or any investigations, sanctions or orders of any Governmental Authority in respect of or binding upon, any member of the UTC
Group, the Otis Group or the Carrier Group to the extent (A) the facts underlying such litigation, claim, investigation, sanction or order relate to, arise out of or result from the conduct of the Carrier Business or the Carrier Assets or the
other Liabilities of Carrier referred to in the foregoing clauses (i) through (vii) or (B) such litigation, claim, investigation, sanction or order includes or is based on allegations relating to, arising out of or resulting from any member of
the UTC Groupβs or of the Otis Groupβs direct or indirect beneficial ownership of the capital stock of any member of the Carrier Group prior to the Effective Time or any member of the UTC Groupβs or of the Otis Groupβs management, oversight,
supervision or operation of the Carrier Business, the Carrier Assets or the Carrier Liabilities prior to the Effective Time, including all Liabilities relating to, arising out of or resulting from any matter set forth on Schedule 2.3(a)(viii), it being understood that to the extent any such litigation, claim, investigation, sanction or order includes or is based on allegations relating to,
arising out of or resulting from any member of the Carrier Groupβs direct or indirect beneficial ownership of the capital stock of any member of the UTC Group or Otis Group prior to the Effective Time, any such Liabilities shall be UTC
Liabilities and/or Otis Liabilities, as applicable, and not Carrier Liabilities;
Β
provided that, notwithstanding anything to the contrary in this Section 2.3(a), the Parties agree that the Liabilities set forth on Schedule 2.3(b)(iii), Schedule 2.3(b)(iv), Schedule 2.3(b)(viii) and Schedule
2.3(c)(i) and any Liabilities of any member of the UTC Group or the Otis Group pursuant to the Ancillary Agreements shall not be Carrier Liabilities.
(b)Β Β Β Β Β Β Β Β Β Β Otis Liabilities.Β For the purposes of this Agreement, βOtis Liabilitiesβ shall mean the following Liabilities of any of the Parties or any members of their respective Groups:
Β
(i)Β Β Β Β Β Β Β Β Β Β all Liabilities included or reflected as liabilities or obligations of Otis or the members of the Otis Group on the Otis Balance Sheet, subject to any
discharge of such Liabilities subsequent to the date of the Otis Balance Sheet; provided, that the amounts set forth on the Otis Balance Sheet with respect to any
Liabilities shall not be treated as minimum amounts or limitations on the amount of such Liabilities that are included in the definition of Otis Liabilities pursuant to this clause (i);
Β
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(ii)Β Β Β Β Β Β Β Β all Liabilities as of the Effective Time that are of a nature or type that would have resulted in such Liabilities being included or reflected as
liabilities or obligations of Otis or the members of the Otis Group on a pro forma combined balance sheet of the Otis Group or any notes or subledgers thereto as of the Effective Time (were such balance sheet, notes and subledgers to be prepared
on a basis consistent with the determination of the Liabilities included on the Otis Balance Sheet), it being understood that (A) the Otis Balance Sheet shall be used to determine the types of, and methodologies used to determine, those
Liabilities that are included in the definition of Otis Liabilities pursuant to this clause (ii); and (B) the amounts set forth on the Otis Balance Sheet with respect to any Liabilities shall not be treated as minimum amounts or limitations on
the amount of such Liabilities that are included in the definition of Otis Liabilities pursuant to this clause (ii);
Β
(iii)Β Β Β Β Β Β Β all Liabilities arising out of any matter set forth on Schedule 2.3(b)(iii);
Β
(iv)Β Β Β Β Β Β Β all Liabilities relating to, arising out of or resulting from the actions, inactions, events, omissions, conditions, facts or circumstances occurring or
existing prior to the Effective Time (whether or not such Liabilities cease being contingent, mature, become known, are asserted or foreseen, or accrue, in each case before, at or after the Effective Time), in each case to the extent that such
Liabilities relate to, arise out of or result from the conduct of the Xxxx Business or an Otis Asset, including all Liabilities relating to, arising out of or resulting from any matter set forth on Schedule
2.3(b)(iv);
Β
(v)Β Β Β Β Β Β Β Β any and all Liabilities that are expressly provided by this Agreement or any Ancillary Agreement (or the Schedules hereto or thereto) as Liabilities to be
assumed by Otis or any other member of the Otis Group, and all agreements, obligations and Liabilities of any member of the Otis Group under this Agreement or any of the Ancillary Agreements;
Β
(vi)Β Β Β Β Β Β Β any and all Liabilities (A) of any UTC Captive Entity or that are or have been transferred from a UTC Captive Entity to a Third-Party insurer, in each case
to the extent that such Liabilities relate to, arise out of or result from the conduct of the Xxxx Business or an Otis Asset and (B) of any Otis Captive Subsidiary (the βOtis Captive Liabilitiesβ);
Β
(vii)Β Β Β Β Β Β all Liabilities to the extent relating to, arising out of or resulting from the Otis Contracts, the Otis Intellectual Property Rights, the Xxxx Technology,
the Otis Permits or the Otis Financing Arrangements; and
Β
(viii)Β Β Β Β Β all Liabilities arising out of litigation or other claims (including in respect of Environmental Liabilities or asbestos Liabilities) made by any Third
Party (including UTCβs, Carrierβs or Otisβs respective directors, officers, stockholders, employees and agents) against, or any investigations, sanctions or orders of any Governmental Authority in respect of or binding upon, any member of the UTC
Group, the Carrier Group or the Otis Group to the extent (A) the facts underlying such litigation,
Β
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claim, investigation, sanction or order relate to, arise out of or result from the conduct of the Xxxx Business or the Otis Assets or the other Liabilities of Otis referred to in the foregoing clauses
(i) through (vii) or (B) such litigation, claim, investigation, sanction or order includes or is based on allegations relating to, arising out of or resulting from any member of the UTC Groupβs or of the Carrier Groupβs direct or indirect
beneficial ownership of the capital stock of any member of the Otis Group prior to the Effective Time or any member of the UTC Groupβs or of the Carrier Groupβs management, oversight, supervision or operation of the Xxxx Business, the Otis Assets
or the Otis Liabilities prior to the Effective Time, including all Liabilities relating to, arising out of or resulting from any matter set forth on Schedule 2.3(b)(viii), it being understood that to the extent any such litigation, claim,
investigation, sanction or order includes or is based on allegations relating to, arising out of or resulting from any member of the Otis Groupβs direct or indirect beneficial ownership of the capital stock of any member of the UTC Group or Carrier
Group prior to the Effective Time, any such Liabilities shall be UTC Liabilities and/or Carrier Liabilities, as applicable, and not Otis Liabilities;
Β
provided that, notwithstanding the foregoing, the Parties agree that the Liabilities set forth on Schedule 2.3(a)(iii), Schedule 2.3(a)(iv), Schedule 2.3(a)(viii) and Schedule 2.3(c)(i) and any Liabilities
of any member of the UTC Group or the Carrier Group pursuant to the Ancillary Agreements shall not be Otis Liabilities.
(c)Β Β Β Β Β Β Β Β Β Β UTC Liabilities.Β For the purposes of this Agreement, βUTC Liabilitiesβ shall mean (i) all Liabilities arising out of any matter set forth on Schedule 2.3(c)(i), (ii)Β all Liabilities relating to, arising out of
or resulting from actions, inactions, events, omissions, conditions, facts or circumstances occurring or existing prior to the Effective Time (whether or not such Liabilities cease being contingent, mature, become known, are asserted or foreseen,
or accrue, in each case before, at or after the Effective Time) of any member of the UTC Group and, prior to the Effective Time, any member of the Carrier Group or Otis Group, in each case that are not Carrier Liabilities or Otis Liabilities and
(iii)Β all Liabilities arising out of litigation or other claims (including in respect of Environmental Liabilities and asbestos Liabilities) made by any Third Party (including UTCβs, Carrierβs or Otisβs respective directors, officers,
stockholders, employees and agents) against, or any investigations, sanctions or orders of any Governmental Authority in respect of or binding upon, any member of the UTC Group, the Carrier Group or the Otis Group to the extent the facts
underlying such litigation, claim, investigation, sanction or order, relate to, arise out of or result from the conduct of the UTC Business or the UTC Assets or the other Liabilities of UTC referred to in the foregoing clauses (i) and (ii), it
being understood that to the extent any such litigation, claim, investigation, sanction or order includes or is based on allegations relating to, arising out of or resulting from any member of the UTC Groupβs direct or indirect beneficial
ownership of the capital stock of any member of the Carrier Group or Otis Group prior to the Effective Time or any member of the UTC Groupβs management, oversight, supervision or operation of the Carrier Business, the Otis Business, the Carrier
Assets, the Otis Assets, the Carrier Liabilities or the Otis Liabilities, as applicable, prior to the Effective Time (including all Liabilities relating to, arising out of or resulting from any matter set forth on Schedule 2.3(a)(viii) or Schedule 2.3(b)(viii)), any such Liabilities shall be Carrier Liabilities and/or Otis
Liabilities, as applicable, and not UTC Liabilities.
Β
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2.4Β Β Β Β Β Β Β Β Β Β Approvals, Notifications and Delays.
Β
(a)Β Β Β Β Β Β Β Β Β Β Approvals and Notifications.Β To the extent that the transfer or assignment of any Asset, the assumption of any
Liability, the Separation, or the Distributions require any Approvals or Notifications, the Parties shall use their commercially reasonable efforts to obtain or make such Approvals or Notifications as soon as reasonably practicable; provided, however, that, except to the extent expressly provided in this Agreement or any of the
Ancillary Agreements or as otherwise agreed between UTC, Carrier and Otis, none of UTC, Carrier or Otis shall be obligated to contribute capital or pay any consideration in any form (including providing any letter of credit, guaranty or other
financial accommodation or agreeing to amended contract terms) to any Person in order to obtain or make such Approvals or Notifications.
Β
(b)Β Β Β Β Β Β Β Β Β Β Delayed Transfers.Β If and to the extent that the valid, complete and perfected transfer or assignment to a Partyβs
Group of any Asset or assumption by a Partyβs Group of any Liability in connection with the Separation or the Distributions would be a violation of applicable Law or require any Approval or Notification that has not been obtained or made by the
applicable Effective Time then, unless the applicable Parties shall otherwise mutually determine, the transfer or assignment to the applicable Group of such Assets or the assumption by the applicable Group of such Liabilities, as the case may be,
shall be automatically deemed deferred and any such purported transfer, assignment or assumption shall be null and void until such time as all legal impediments are removed or such Approval or Notification has been obtained or made.Β
Notwithstanding the foregoing, any such Assets or Liabilities shall continue to constitute Assets of the applicable Party to which such Assets were to be transferred or assigned, or Liabilities of the applicable Party by which such Liabilities
were to be assumed, respectively, for all other purposes of this Agreement.
Β
(c)Β Β Β Β Β Β Β Β Β Β Treatment of Delayed Assets and Delayed Liabilities.Β If any transfer or assignment of any Asset (or a portion
thereof) or any assumption of any Liability (or a portion thereof) intended to be transferred, assigned or assumed hereunder, as the case may be, is not consummated on or prior to the applicable Effective Time, whether as a result of the
provisions of Section 2.4(b) or for any other reason (any such Asset (or a portion thereof), a βDelayed Assetβ and any such Liability (or a portion thereof), a βDelayed Liabilityβ), then, insofar as reasonably possible and subject to applicable Law,
the Person retaining such Delayed Asset or such Delayed Liability (the βHolding Memberβ), as the case may be, shall thereafter hold such Delayed Asset or Delayed
Liability, as the case may be, on behalf of the Person entitled to the benefits of such Delayed Asset or obligated to discharge such Delayed Liability, as applicable (the βReceiving Memberβ) (at the expense of the Receiving Member).Β In addition, the Holding Member shall, insofar as reasonably possible and to the extent permitted by applicable Law, treat such Delayed Asset or Delayed Liability in the
ordinary course of business in accordance with past practice and take such other actions as may be reasonably requested by the Receiving Member in order to place the Receiving Member in a substantially similar position as if such Delayed Asset or
Delayed Liability had been transferred, assigned or assumed as contemplated hereby and so that all the benefits and burdens relating to such Delayed Asset or Delayed Liability, as the case may be, including use, risk of loss, potential for gain,
and dominion, control and command over such Delayed Asset or Delayed Liability, as the case may be, and all costs and expenses related thereto, shall inure from and after the Effective Time to the Receiving Memberβs Group.
Β
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(d)Β Β Β Β Β Β Β Β Β Β Transfer of Delayed Assets and Delayed Liabilities.Β If and when the Approvals or Notifications, the absence of which
caused the deferral of transfer or assignment of any Delayed Asset or the deferral of assumption of any Delayed Liability pursuant to Section 2.4(b), are obtained
or made, and, if and when any other legal impediments to the transfer or assignment of any Delayed Asset or the assumption of any Delayed Liability have been removed, the transfer or assignment of the applicable Delayed Asset or the assumption of
the applicable Delayed Liability, as the case may be, shall be effected in accordance with the terms of this Agreement and/or the applicable Ancillary Agreement.
Β
(e)Β Β Β Β Β Β Β Β Β Β Costs for Delayed Assets and Delayed Liabilities.Β No Holding Member shall be obligated, in connection with the
foregoing, to expend any money unless the necessary funds are advanced (or otherwise made available) by the Receiving Member or another member of the Receiving Memberβs Group, other than reasonable out-of-pocket expenses, attorneysβ fees and
recording or similar fees, all of which shall be promptly reimbursed by the Receiving Member or another member of the Receiving Memberβs Group entitled to the benefits of such Delayed Asset or obligated to discharge such Delayed Liability, as
applicable.
Β
2.5Β Β Β Β Β Β Β Β Β Β Novation of Liabilities.
Β
(a)Β Β Β Β Β Β Β Β Β Β Except as set forth in Schedule 2.5(a) and in Section 5.1 of the Intellectual Property
Agreement, each of UTC, Carrier and Otis, at the request of any other Party, shall use its commercially reasonable efforts to obtain, or to cause to be obtained, as soon as reasonably practicable, any consent, substitution, approval or amendment
required to novate or assign all UTC Liabilities, Carrier Liabilities or Otis Liabilities, as applicable, and obtain in writing the unconditional release of each member of each other Partyβs Group that is a party to any such arrangements, so
that, in any such case, the members of the Carrier Group shall be solely responsible for such Carrier Liabilities, the members of the Otis Group shall be solely responsible for such Otis Liabilities, and the members of the UTC Group shall be
solely responsible for such UTC Liabilities; provided, that, except as otherwise expressly provided in this Agreement or any of the Ancillary Agreements, none of
UTC, Carrier or Otis shall be obligated to contribute any capital or pay any consideration in any form (including providing any letter of credit, guaranty or other financial accommodation or agreeing to amended contract terms) to any Third Party
from whom any such consent, substitution, approval, amendment or release is requested.
Β
(b)Β Β Β Β Β Β Β Β Β Β If the Parties are unable to obtain, or to cause to be obtained, any such required consent, substitution, approval, amendment or release and a member of any Group (the βBound Memberβ) continues to be bound by any such arrangement or responsible for any such Liability with respect to which such Bound Member would not be bound or responsible had
such required consent, substitution, approval, amendment or release been obtained (each, an βUnreleased Liabilityβ), the Party to whose Group such Liability is
allocated under this Agreement (the βDesignated Partyβ) shall, to the extent not prohibited by Law, as indemnitor, guarantor, agent or subcontractor for the Bound
Member, as the case may be, (i) pay, perform and discharge fully all the obligations or other Liabilities of the Bound Member that constitute Unreleased Liabilities from and after the Effective Time and (ii) use its commercially reasonable
efforts to effect such payment, performance or discharge prior to the time any demand for such payment, performance or discharge is permitted to be made by the obligee thereunder on any
Β
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member of the Bound Memberβs Group.Β If and when any such consent, substitution, approval, amendment or release shall be obtained or the Unreleased Liabilities shall otherwise become assignable or able to be novated, the
Bound Member shall promptly assign, or cause to be assigned, and the Designated Party or the applicable member of its Group shall assume, such Unreleased Liabilities without exchange of further consideration.
Β
(c)Β Β Β Β Β Β Β Β Β Β Without limiting the Partiesβ rights and obligations pursuant to Article IV:
Β
(i)Β Β Β Β Β Β Β Β Β Β if Carrier or Otis, or any member of their respective Groups, is a named defendant in a Third-Party Claim that does not arise out of any UTC Liabilities but
to which UTC or a member of its Group is a named defendant, Carrier or Xxxx, as applicable, shall promptly use, or cause the applicable member of its Group to use, commercially reasonable efforts to obtain the dismissal of UTC or any applicable
members of the UTC Group as defendants to such Third-Party Claim;
Β
(ii)Β Β Β Β Β Β Β Β if UTC or Carrier, or any member of their respective Groups, is a named defendant in a Third-Party Claim that does not arise out of any Otis Liabilities
but to which Otis or a member of its Group is a named defendant, UTC or Carrier, as applicable, shall promptly use, or cause the applicable member of its Group to use, commercially reasonable efforts to obtain the dismissal of Otis or any
applicable members of the Otis Group as defendants to such Third-Party Claim; and
Β
(iii)Β Β Β Β Β Β Β if UTC or Otis, or any member of their respective Groups, is a named defendant in a Third-Party Claim that does not arise out of any Carrier Liabilities
but to which Carrier or a member of its Group is a named defendant, UTC or Xxxx, as applicable, shall promptly use, or cause the applicable member of its Group to use, commercially reasonable efforts to obtain the dismissal of Carrier or any
applicable members of the Carrier Group as defendants to such Third-Party Claim.
Β
Notwithstanding the foregoing, no Party or member of its Group shall be required to take any action pursuant to this Section 2.5(c) that would reasonably be expected to be detrimental in any material respect to
such Personβs litigation strategy or defense of the applicable Third-Party Claim or any related Third-Party Claim.
Β
2.6Β Β Β Β Β Β Β Β Β Β Release of Guarantees.Β In furtherance of, and not in limitation of, the obligations set forth in Section 2.5:
Β
(a)Β Β Β Β Β Β Β Β Β Β On or prior to the applicable Effective Time or as soon as practicable thereafter, each of UTC, Carrier and Xxxx, as applicable, shall, at the request of any other Party that
serves (or a member of whose Group serves) as a guarantor of or obligor for any of such first Partyβs (or a member of such first Partyβs Groupβs) Liabilities, including through any Security Interest on or in any of such other Partyβs (or a member
of such other Partyβs Groupβs) Assets that serve as collateral or security for any of such first Partyβs (or a member of such first Partyβs Groupβs) Liabilities, and with the reasonable cooperation of such other Party and the applicable member(s)
of such other Partyβs Group, use commercially reasonable efforts to, as applicable:Β (i)Β have any member(s) of the UTC Group removed as guarantor of or obligor for any Carrier or Otis Liability to the extent that such guarantee or obligation
relates to Carrier or Otis Liabilities,
Β
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including the removal of any Security Interest on or in any UTC Asset that may serve as collateral or security for any such Carrier or Otis Liability; (ii)Β have any member(s) of the Carrier Group removed as guarantor of
or obligor for any UTC or Otis Liability to the extent that such guarantee or obligation relates to UTC or Otis Liabilities, including the removal of any Security Interest on or in any Carrier Asset that may serve as collateral or security for any
such UTC or Otis Liability; and (iii)Β have any member(s) of the Otis Group removed as guarantor of or obligor for any UTC or Carrier Liability to the extent that such guarantee or obligation relates to UTC or Carrier Liabilities, including the
removal of any Security Interest on or in any Otis Asset that may serve as collateral or security for any such UTC or Carrier Liability.
Β
(b)Β Β Β Β Β Β Β Β Β Β Notwithstanding anything herein to the contrary, to the extent required to obtain a release from a guarantee of any member of another Partyβs Group, UTC, Carrier or Xxxx, as
applicable, shall execute a guarantee agreement in the form of the existing guarantee or such other form as is agreed to by the relevant parties to such guarantee agreement, which agreement shall include the removal of any Security Interest on or
in any Asset of such other Party that may serve as collateral or security for any UTC Liability, Carrier Liability or Otis Liability, as applicable, except to the extent that such existing guarantee contains representations, covenants or other
terms or provisions, either (i) with which UTC, Carrier or Xxxx, as applicable, would be reasonably unable to comply or (ii) which UTC, Carrier or Xxxx, as applicable, would not reasonably be able to avoid breaching.
Β
(c)Β Β Β Β Β Β Β Β Β Β If UTC, Carrier or Otis is unable to obtain, or to cause to be obtained, any such required removal or release as set forth in clauses (a) and (b) of this Section 2.6, (i) the Party or the relevant member of its Group that has assumed the Liability that such guarantee relates to shall indemnify, defend and hold harmless the
guarantor or obligor against or from any Liability arising from or relating thereto in accordance with the provisions of Article IV and shall, as agent or
subcontractor for such guarantor or obligor, pay, perform and discharge fully all the obligations or other Liabilities of such guarantor or obligor thereunder; and (ii) each of UTC, Carrier and Otis, on behalf of itself and the other members of
its Group, agrees not to renew or extend the term of, increase any obligations under, or transfer to a Third Party, any loan, guarantee, lease, contract or other obligation for which the guarantor or obligor or a member of its Group is or may be
liable unless all obligations of such guarantor or obligor and the members of such guarantor or obligorβs Group with respect thereto are thereupon terminated by documentation satisfactory in form and substance to such guarantor or obligor.
Β
2.7Β Β Β Β Β Β Β Β Β Β Termination of Agreements.
Β
(a)Β Β Β Β Β Β Β Β Β Β Except as set forth in Section 2.7(b), in furtherance of the releases and other provisions of
Section 4.1, each of UTC, Carrier and Otis and each member of their respective Groups hereby terminate any and all agreements, arrangements, commitments or
understandings, whether or not in writing, between or among a Party and/or any member of such Partyβs Group, on the one hand, and another Party and/or any member of such other Partyβs Group, on the other hand, effective as of the applicable
Effective Time.Β No such terminated agreement, arrangement, commitment or understanding (including any provision thereof that purports to survive termination) shall be of any further force or effect after the Effective Time.Β Each Party shall, at
the reasonable request of the other Party, take, or cause to be taken, such other actions as may be necessary to effect the foregoing.
Β
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(b)Β Β Β Β Β Β Β Β Β Β The provisions of Section 2.7(a) shall not apply to any of the following agreements,
arrangements, commitments or understandings (or to any of the provisions thereof):Β (i) this Agreement and the Ancillary Agreements (and each other agreement or instrument expressly contemplated by this Agreement or any Ancillary Agreement to be
entered into by any of the Parties or any of the members of their respective Groups or to be continued from and after the Effective Time); (ii) any agreements, arrangements, commitments or understandings listed or described on Schedule 2.7(b)(ii); (iii) any agreements, arrangements, commitments or understandings to which any Third Party is a party thereto (including any Shared Contracts); (iv) any
intercompany accounts payable or accounts receivable accrued as of the Effective Time that are reflected in the books and records of the Parties or otherwise documented in writing in accordance with past practices, which shall be settled in the
manner contemplated by Section 2.7(c); (v) any agreements, arrangements, commitments or understandings to which any non-wholly owned Subsidiary of UTC, Carrier or
Xxxx, as the case may be, is a party (it being understood that directorsβ qualifying shares or similar interests will be disregarded for purposes of determining whether a Subsidiary is wholly owned); and (vi) any agreements for the sale, lease,
construction or receipt of goods, property or services purchased, obtained or used in the ordinary course of business by a member of any Group from a member of another Group prior to the Effective Time.
Β
(c)Β Β Β Β Β Β Β Β Β Β All of the intercompany accounts receivable and accounts payable between any member of a Partyβs Group, on the one hand, and any member of another Partyβs Group, on the other
hand, outstanding as of the Effective Time shall, as promptly as practicable after the Effective Time, be repaid, settled or otherwise eliminated in a manner as determined by UTC in its sole and absolute discretion (acting in good faith).
Β
2.8Β Β Β Β Β Β Β Β Β Β Treatment of Shared Contracts.
Β
(a)Β Β Β Β Β Β Β Β Β Β Subject to applicable Law and without limiting the generality of the obligations set forth in Section 2.1, unless the applicable Parties otherwise agree or the benefits of any contract, agreement, arrangement, commitment or understanding described in this Section 2.8 are expressly conveyed to the applicable Party pursuant to this Agreement or an Ancillary Agreement, any contract or agreement (i) a portion of which would, without taking into account the provisions of this Section 2.8, be a Carrier Contract or an Otis Contract, but the remainder of which would be a UTC Asset, (ii) a portion of which would, without taking into account the provisions
of this Section 2.8, be a Carrier Contract, but the remainder of which would be an Otis Contract, or (iii) a portion of which would, without taking into account the
provisions of this Section 2.8, be a Carrier Contract, a portion of which would, without accounting for the provisions of this Section
2.8, be an Otis Contract, but the remainder of which would be a UTC Asset (any such contract or agreement described in clauses (i), (ii) or (iii), a βShared
Contractβ), shall be deemed to be, notwithstanding anything to the contrary in Section 2.1, (A) in the case of a customer
or distribution contract that primarily relates to the Carrier Business, a Carrier Contract, (B) in the case of a customer or distribution contract that primarily relates to the Xxxx Business, an Otis Contract, (C) in the case of any other Shared
Contract described in clauses (i) or (iii), a UTC Asset, (D) in the case of any other Shared Contract described in clause (ii) that primarily relates to the Carrier Business, a Carrier Contract and (F) in the case of any other Shared Contract
described in clause (ii) that primarily relates to the Xxxx Business, an Otis Contract; provided, however, that the Parties will use commercially reasonable efforts so that as
Β
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of the Effective Time, each Party or the member of its Group that is party to a Shared Contract that was not allocated to it pursuant to this Agreement may be entitled to the rights and benefits of, and obligated to
discharge any Liabilities with respect to, that portion of the Shared Contract that relates to the UTC Business, the Carrier Business or the Otis Business, as the case may be (in each case, to the extent so related), whether through new agreement,
amendment or partial assignment of the relevant portion of such Shared Contract; provided, further, that (1) in no event shall any member of any Group be required to assign (or amend) a portion of any Shared Contract which is not
assignable (or cannot be amended) by its terms (including any terms imposing consents or conditions on an assignment or amendment where such consents or conditions have not been obtained or fulfilled) and (2) if any Shared Contract cannot be so
assigned by its terms or otherwise, or cannot be amended, or cannot be replaced with a new agreement, or if such assignment, amendment or new agreement would impair the benefit the parties thereto derive from such Shared Contract, then the Parties
shall, and shall cause each of the members of their respective Groups to, take such other reasonable and permissible actions (including by providing prompt notice to the other applicable Parties with respect to any relevant claim of Liability or
other relevant matters arising in connection with a Shared Contract so as to allow such other applicable Parties the ability to exercise any applicable rights under such Shared Contract) to cause a member of such other applicable Partyβs respective
Group to receive the rights and benefits of that portion of each Shared Contract that relates to the UTC Business, the Carrier Business or the Otis Business, as the case may be (in each case, to the extent so related), as if such Shared Contract
had been assigned to a member of the applicable Group or amended, or a new agreement had been entered into, in each case to allow a member of the applicable Group to exercise applicable rights under such Shared Contract pursuant to this Section
2.8, and to require a member of the applicable Group to bear the burden of the corresponding Liabilities (including any Liabilities that may arise by reason of such arrangement), as if such Liabilities had been assumed by a member of the
applicable Group pursuant to this Section 2.8.
Β
(b)Β Β Β Β Β Β Β Β Β Β Each of UTC, Carrier and Otis shall, and shall cause the members of its Group to, (i) treat for all income Tax purposes the portion of each Shared Contract inuring to its
respective businesses as an Asset owned by, and/or a Liability of, as applicable, such Party, or the members of its Group, as applicable, not later than the Effective Time, and (ii) neither report nor take any income Tax position (on a Tax return
or otherwise) inconsistent with such treatment (unless required by applicable Law).
Β
(c)Β Β Β Β Β Β Β Β Β Β Nothing in this Section 2.8 shall require any member of any Group to make any non-de minimis payment (except to the extent advanced, assumed or agreed in advance to be reimbursed by any member of the other Group), incur any non-de minimis obligation or grant any non-de minimis concession for the
benefit of any member of any other Group in order to effect any transaction contemplated by this Section 2.8.
Β
2.9Β Β Β Β Β Β Β Β Β Β Bank Accounts; Cash Balances.
Β
(a)Β Β Β Β Β Β Β Β Β Β Each Party agrees to take, or cause the members of its Group to take, at the Effective Time (or such earlier time as the Parties may agree), all actions necessary to amend all
contracts or agreements governing each bank and brokerage account owned by such Party or any member of its Group (collectively, the βAccountsβ) so that each such
Account, if currently Linked to any Account of another Party is de-Linked from such other Partyβs Account, subject to
Β
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any transitory arrangements as may otherwise be agreed between members of the applicable Partiesβ respective Groups.
Β
(b)Β Β Β Β Β Β Β Β Β Β It is intended that, following consummation of the actions contemplated by Section 2.9(a),
there will be in place (i) cash management processes pursuant to which the Carrier Accounts will be managed and funds collected will be transferred into one (1) or more accounts maintained by Carrier or a member of the Carrier Group and (ii) cash
management processes pursuant to which the Otis Accounts will be managed and funds collected will be transferred into one (1) or more accounts maintained by Otis or a member of the Otis Group.
Β
(c)Β Β Β Β Β Β Β Β Β Β It is intended that, following consummation of the actions contemplated by Section 2.9(a),
there will continue to be in place cash management processes pursuant to which the UTC Accounts will be managed and funds collected will be transferred into one (1) or more accounts maintained by UTC or a member of the UTC Group.
Β
(d)Β Β Β Β Β Β Β Β Β Β With respect to any outstanding checks issued or payments initiated by UTC, Xxxxxxx, Xxxx or any members of their respective Group prior to the Effective Time, such
outstanding checks and payments shall be honored following the Effective Time by the Person or Group owning the account on which the check is drawn or from which the payment was initiated, respectively.
Β
(e)Β Β Β Β Β Β Β Β Β Β As between UTC, Carrier and Otis (and the members of their respective Groups), all payments or reimbursements received after the Effective Time by any of the Parties (or any
member of their respective Groups) that relate to a business, Asset or Liability of another Party (or any member of such other Partyβs Group), shall be held by such first Party in trust for the use and benefit of the Party entitled thereto and,
promptly following receipt by such first Party of any such payment or reimbursement, such first Party shall pay over, or shall cause the applicable member of its Group to pay over to the other Party the amount of such payment or reimbursement
without right of set-off.
Β
2.10Β Β Β Β Β Β Β Ancillary Agreements.Β Effective on or prior to the Effective Time, each of UTC, Carrier and Otis will, or will cause the applicable members of
its Group to, execute and deliver all Ancillary Agreements to which it is a party (other than Transfer Documents executed and delivered prior to the date hereof).
Β
2.11Β Β Β Β Β Β Β Disclaimer of Representations and Warranties.Β EACH OF UTC (ON BEHALF OF ITSELF AND EACH MEMBER OF THE UTC GROUP), CARRIER (ON BEHALF OF ITSELF
AND EACH MEMBER OF THE CARRIER GROUP) AND OTIS (ON BEHALF OF ITSELF AND EACH MEMBER OF THE OTIS GROUP) UNDERSTANDS AND AGREES THAT, EXCEPT AS EXPRESSLY SET FORTH HEREIN OR IN ANY ANCILLARY AGREEMENT, NO PARTY TO THIS AGREEMENT, ANY ANCILLARY
AGREEMENT OR ANY OTHER AGREEMENT OR DOCUMENT CONTEMPLATED BY THIS AGREEMENT, ANY ANCILLARY AGREEMENT OR OTHERWISE, IS REPRESENTING OR WARRANTING IN ANY WAY AS TO:Β (A) THE ASSETS, BUSINESSES OR LIABILITIES TRANSFERRED OR ASSUMED AS CONTEMPLATED
HEREBY OR THEREBY, (B) ANY CONSENTS OR APPROVALS REQUIRED IN CONNECTION WITH SUCH TRANSFER OR ASSUMPTION, (C) THE VALUE OR
Β
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FREEDOM FROM ANY SECURITY INTERESTS OF, OR ANY OTHER MATTER CONCERNING, ANY ASSETS OF SUCH PARTY, (D) THE ABSENCE OF ANY DEFENSES OR RIGHT OF SET-OFF OR FREEDOM FROM COUNTERCLAIM WITH RESPECT TO ANY CLAIM OR OTHER ASSET,
INCLUDING ANY ACCOUNTS RECEIVABLE, OF ANY PARTY, OR (E) THE LEGAL SUFFICIENCY OF ANY ASSIGNMENT, DOCUMENT OR INSTRUMENT DELIVERED HEREUNDER TO CONVEY TITLE TO ANY ASSET OR THING OF VALUE UPON THE EXECUTION, DELIVERY AND FILING OF THIS AGREEMENT,
ANY ANCILLARY AGREEMENT OR ANY OTHER AGREEMENT OR DOCUMENT CONTEMPLATED BY THIS AGREEMENT OR ANY ANCILLARY AGREEMENT.Β EXCEPT AS MAY EXPRESSLY BE SET FORTH HEREIN OR IN ANY ANCILLARY AGREEMENT, ALL SUCH ASSETS ARE BEING TRANSFERRED ON AN βAS IS,β
βWHERE ISβ BASIS (AND, IN THE CASE OF ANY REAL PROPERTY, BY MEANS OF A QUITCLAIM OR SIMILAR FORM OF DEED OR CONVEYANCE), AND THE RESPECTIVE TRANSFEREES SHALL BEAR THE ECONOMIC AND LEGAL RISKS THAT (I) ANY CONVEYANCE WILL PROVE TO BE INSUFFICIENT TO
VEST IN THE TRANSFEREE GOOD AND MARKETABLE TITLE, FREE AND CLEAR OF ANY SECURITY INTEREST, AND (II)Β ANY NECESSARY APPROVALS OR NOTIFICATIONS ARE NOT OBTAINED OR MADE OR THAT ANY REQUIREMENTS OF LAWS OR JUDGMENTS ARE NOT COMPLIED WITH.
Β
2.12Β Β Β Β Β Β Β Β Β Β Financing Arrangements; Cash Transfers.
Β
(a)Β Β Β Β Β Β Β Β Β Β Prior to the Carrier Effective Time, (i) Carrier and/or other members of the Carrier Group will enter into one or more financing arrangements and agreements, as set forth on Schedule 2.12(a) (the βCarrier Financing Arrangementsβ), pursuant to which it or they shall
borrow prior to the Carrier Effective Time an aggregate principal amount of approximately $11,000,000,000 and (ii) Carrier shall distribute, convey or otherwise transfer in the manner determined by UTC some or all (as determined by UTC) of the
proceeds of the Carrier Financing Arrangements to UTC as partial consideration for the transfer of Carrier Assets to Carrier in the Carrier Contribution pursuant to Section 2.1 (such transfer, distribution or conveyance, the βCarrier Cash Transferβ).Β UTC and Carrier agree to take all necessary actions to assure the
full release and discharge of UTC and the other members of the UTC Group from all obligations (including any guarantees) in connection with the Carrier Financing Arrangements as of no later than the Carrier Effective Time.Β The Parties agree that
Carrier or another member of the Carrier Group, as the case may be, and not UTC or Otis or any member of their respective Groups, are and shall be responsible for all costs and expenses incurred in connection with the Carrier Financing
Arrangements.
Β
(b)Β Β Β Β Β Β Β Β Β Β Prior to the Otis Effective Time, (i) Otis and/or other members of the Otis Group will enter into one or more financing arrangements and agreements, as set forth on Schedule 2.12(b) (the βOtis Financing Arrangementsβ), pursuant to which it or they shall borrow
prior to the Otis Effective Time an aggregate principal amount of approximately $6,300,000,000 and (ii) Otis shall distribute, convey or otherwise transfer in the manner determined by UTC some or all (as determined by UTC) of the proceeds of the
Otis Financing Arrangements to UTC as partial consideration for the transfer of Otis Assets to Otis in the Otis Contribution pursuant to Section 2.1 (such transfer,
distribution or conveyance, the βXxxx Xxxx Transferβ).Β UTC and Otis agree to take all necessary actions to assure the full release and discharge of UTC and the
other
Β
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members of the UTC Group from all obligations (including any guarantees) in connection with the Otis Financing Arrangements as of no later than the Otis Effective Time.Β The Parties agree that Otis or another member of
the Otis Group, as the case may be, and not UTC or Carrier or any member of their respective Groups, are and shall be responsible for all costs and expenses incurred in connection with the Otis Financing Arrangements.
Β
(c)Β Β Β Β Β Β Β Β Β Β Prior to the Second Effective Time, UTC, Carrier and Otis shall cooperate as necessary in the preparation of all materials as may be necessary or advisable to execute the
Carrier Financing Arrangements and the Otis Financing Arrangements, as applicable.
Β
2.13Β Β Β Β Β Β Β Β Β Β Financial Information Certifications.
Β
(a)Β Β Β Β Β Β Β Β Β Β UTCβs disclosure controls and procedures and internal control over financial reporting (as each is contemplated by the Exchange Act) are currently applicable to Carrier and
Xxxx as UTCβs Subsidiaries.Β In order to enable the principal executive officer and principal financial officer of each of Carrier and Otis to make the certifications required of them under Section 302 of the Xxxxxxxx-Xxxxx Act of 2002 following
the applicable Distribution in respect of any quarterly or annual fiscal period of Carrier or Xxxx, as applicable, that begins on or prior to the applicable Distribution Date (a βStraddle Periodβ), upon twenty (20) business daysβ (or such shorter period as may elapse between the Effective Time and the due date for such filing) advance written request by Carrier or Xxxx, as applicable, UTC shall provide Carrier or
Xxxx, as applicable, with one (1) or more certifications with respect to such disclosure controls and procedures and the effectiveness thereof and whether there were any changes in the internal controls over financial reporting that have
materially affected or are reasonably likely to materially affect the internal control over financial reporting, which certification(s) shall (i) be with respect to the portion of the applicable Straddle Period on or prior to the applicable
Distribution Date (it being understood that no certification need be provided with respect to any period or portion of any period after the applicable Distribution Date) and (ii) be in substantially the same form as those that had been provided
by officers or employees of UTC in similar certifications delivered prior to the applicable Distribution Date, with such changes thereto as UTC may reasonably determine.Β Such certification(s) shall be provided by UTC (and not by any officer or
employee in their individual capacity).
Β
(b)Β Β Β Β Β Β Β Β Β Β In order to enable the principal executive officer and principal financial officer of UTC to make the certifications required of them under Section 302 of the Xxxxxxxx-Xxxxx
Act of 2002 for any Straddle Period, upon twenty (20) business daysβ (or such shorter period as may elapse between the Effective Time and the due date for such filing) advance written request by UTC, Carrier or Xxxx, as applicable, shall provide
UTC with one or more certifications with respect to the applicable disclosure controls and procedures and internal controls over financial reporting (as each is contemplated by the Exchange Act), and the effectiveness thereof and whether there
were any changes in such internal controls over financial reporting that have materially affected or are reasonably likely to materially affect such internal control over financial reporting, which certification(s) shall (i) be with respect to
the portion of the applicable Straddle Period on or prior to the applicable Distribution Date (it being understood that no certification need be provided with respect to any period or portion of any period after the applicable Distribution Date)
and (ii) be in substantially the same form as those that had been provided by officers or employees of UTC or any of its Subsidiaries in similar certifications
Β
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delivered prior to the applicable Distribution Date, with such changes thereto as Carrier or Xxxx, as applicable, may reasonably determine.Β Such certification(s) shall be provided by Carrier or Otis (and not by any
officer or employee in their individual capacity).
Β
2.14Β Β Β Β Β Transition Committee.Β Prior to the First Effective Time, the Parties shall establish a transition committee (the βTransition Committeeβ)
that shall consist of an equal number of members from UTC, Carrier and Otis.Β From and after the applicable Effective Time, the Transition Committee shall be responsible for monitoring and managing all matters related to any of the transactions
contemplated by this Agreement or any Ancillary Agreements.Β From and after the applicable Effective Time, the Transition Committee shall have the authority to (a) establish one or more subcommittees from time to time as it deems appropriate or as
may be described in any Ancillary Agreements, with each such subcommittee comprised of one or more members of the Transition Committee or one or more employees of any of the Parties or any members of their respective Groups, and each such
subcommittee having such scope of responsibility as may be determined by the Transition Committee from time to time; (b) delegate to any such committee any of the monitoring and managing authority of the Transition Committee; and (c) combine,
modify the scope of responsibility of, and disband any such subcommittees, and to modify or reverse any such delegations.Β The Transition Committee shall establish general procedures for managing the responsibilities delegated to it under this Section
2.14 and may modify such procedures from time to time.Β All decisions by the Transition Committee or any subcommittee thereof shall be effective only if mutually agreed by each of the applicable Parties.Β The Parties shall utilize the
procedures set forth in Article VII to resolve any matters as to which the Transition Committee is not able to reach a decision.
Β
ARTICLE III
THE DISTRIBUTIONS
THE DISTRIBUTIONS
Β
3.1Β Β Β Β Β Β Β Β Β Β Sole and Absolute Discretion; Cooperation.
Β
(a)Β Β Β Β Β Β Β Β Β Β Prior to the applicable Effective Time, subject to the applicable provisions of the Merger Agreement, UTC shall, in its sole and absolute discretion, determine the terms of
each Distribution, including the form, structure and terms of any transaction(s) and/or offering(s) to effect each such Distribution and the timing and conditions to the consummation of each such Distribution.Β In addition, with respect to each
Distribution, UTC may, at any time and from time to time until the consummation of such Distribution, modify or change the terms of such Distribution, including by accelerating or delaying the timing of the consummation of all or part of such
Distribution or waiving or imposing conditions to the consummation of such Distribution.Β Prior to the First Effective Time, nothing in this Agreement shall in any way limit UTCβs right to terminate this Agreement or either or each Distribution
as set forth in Article IX or alter the consequences of any such termination from those specified in Article IX.Β Following the First Effective Time, subject to Section 10.14, nothing in this Agreement shall in any way limit UTCβs right to amend,
modify or abandon the Second Distribution at any time prior to the Second Effective Time in its sole and absolute discretion, without approval or consent of any other Person, including Carrier and Otis.
Β
(b)Β Β Β Β Β Β Β Β Β Β Each of Carrier and Otis shall cooperate with UTC to accomplish the Carrier Distribution and the Otis Distribution, respectively, and shall, at UTCβs direction,
Β
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promptly take any and all actions necessary or desirable to effect the Carrier Distribution or the Otis Distribution, respectively, including in respect of the registration under the Exchange Act of Carrier Shares on the
Carrier Form 10 or Otis Shares on the Otis Form 10, as applicable.Β UTC shall select any investment bank or manager in connection with each Distribution, as well as any financial printer, solicitation and/or exchange agent and financial, legal,
accounting and other advisors in connection with each such Distribution.Β Carrier or Xxxx, as the case may be, will provide to the Distribution Agent any Information required in order to complete the Carrier Distribution or the Otis Distribution.
Β
3.2Β Β Β Β Β Β Β Β Β Β Actions Prior to the Distribution.Β Prior to the applicable Effective Time and subject to the terms and conditions set forth herein, the Parties
shall take, or cause to be taken, the following actions in connection with each Distribution:
Β
(a)Β Β Β Β Β Β Β Β Β Β Notice to NYSE.Β UTC shall, to the extent practical, give the NYSE advance notice of the applicable Record Date in
compliance with Rule 10b-17 under the Exchange Act.
Β
(b)Β Β Β Β Β Β Β Β Β Β Certificate of Incorporation and Bylaws of Carrier and Otis.Β (i) On or prior to the Carrier Distribution Date, UTC
and Carrier shall take all necessary actions so that, as of the Carrier Effective Time, the Carrier Certificate of Incorporation and the Carrier Bylaws shall become the certificate of incorporation and bylaws, respectively, of Carrier, and (ii)
on or prior to the Otis Distribution Date, UTC and Otis shall take all necessary actions so that, as of the Otis Effective Time, the Otis Certificate of Incorporation and the Otis Bylaws shall become the certificate of incorporation and bylaws,
respectively, of Otis.
Β
(c)Β Β Β Β Β Β Β Β Β Β Directors and Officers of Carrier and Otis.
Β
(i)Β Β Β Β Β Β Β Β Β Β On or prior to the Carrier Distribution Date, UTC and Carrier shall take all necessary actions so that as of the Carrier Effective Time:Β (A) the directors
and executive officers of Carrier shall be those set forth in the Carrier Information Statement made available to the Record Holders prior to the Carrier Distribution Date, unless otherwise determined by UTC; (B) each individual referred to in
clause (A) shall have resigned from his or her position, if any, as a member of the UTC Board and/or as an executive officer of UTC; and (C) Carrier shall have such other officers as Carrier shall appoint.
Β
(ii)Β Β Β Β Β Β Β Β On or prior to the Otis Distribution Date, UTC and Otis shall take all necessary actions so that as of the Otis Effective Time:Β (A) the directors and
executive officers of Otis shall be those set forth in the Otis Information Statement made available to the Record Holders prior to the Otis Distribution Date, unless otherwise determined by UTC; (B) each individual referred to in clause (A)
shall have resigned from his or her position, if any, as a member of the UTC Board and/or as an executive officer of UTC; and (C) Otis shall have such other officers as Otis shall appoint.
Β
(d)Β Β Β Β Β Β Β Β Β Β NYSE Listing.Β Each of Carrier and Otis shall prepare and file, and shall use its best efforts to have approved, an
application for the listing of the Carrier Shares and the
Β
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Otis Shares, respectively, to be distributed in the Carrier Distribution and the Otis Distribution, respectively, on the NYSE, subject to official notice of distribution.
Β
(e)Β Β Β Β Β Β Β Β Β Β Securities Law Matters.Β Each of Carrier and Otis shall file any amendments or supplements to the Carrier Form 10 and
the Otis Form 10, respectively, as UTC may determine to be necessary or advisable in order to cause the Form 10s to become and remain effective as required by the SEC or federal, state or other applicable securities Laws.Β UTC, Carrier and Otis
shall cooperate in preparing, filing with the SEC and causing to become effective registration statements or amendments thereof that are required to reflect the establishment of, or amendments to, any employee benefit and other plans necessary or
advisable in connection with the transactions contemplated by this Agreement and the Ancillary Agreements.Β Each of UTC, Carrier and Otis will prepare, and Carrier and Otis will, to the extent required under applicable Law, file with the SEC, any
such documentation and any requisite no-action letters which UTC determines are necessary or desirable to effectuate the Carrier Distribution or the Otis Distribution, as applicable, and UTC, Carrier and Otis shall each use its reasonable best
efforts to obtain all necessary approvals from the SEC with respect thereto as soon as practicable.Β UTC, Carrier and Otis shall take all such action as may be necessary or appropriate under the securities or blue sky Laws of the United States
(and any comparable Laws under any foreign jurisdiction) in connection with the Distributions.
Β
(f)Β Β Β Β Β Β Β Β Β Β Availability of Information Statement.Β (i) UTC shall, as soon as is reasonably practicable after the Carrier Form 10
is declared effective under the Exchange Act and the UTC Board has approved the Carrier Distribution, cause the Carrier Information Statement to be made available to the Record Holders; and (ii) UTC shall, as soon as is reasonably practicable
after the Otis Form 10 is declared effective under the Exchange Act and the UTC Board has approved the Otis Distribution, cause the Otis Information Statement to be made available to the Record Holders.
Β
(g)Β Β Β Β Β Β Β Β Β Β The Distribution Agent.Β UTC shall enter into one or more distribution agent agreements with the Distribution Agent or
otherwise provide instructions to the Distribution Agent regarding each Distribution.
Β
(h)Β Β Β Β Β Β Β Β Β Β Stock-Based Employee Benefit Plans.Β Each of UTC, Carrier and Otis shall take all actions as may be necessary to
approve any grants of adjusted equity awards by UTC (in respect of UTC Shares), Carrier (in respect of Carrier Shares) and Otis (in respect of Otis Shares) in connection with the Distributions in order to satisfy the requirements of Rule 16b-3
under the Exchange Act.
Β
3.3Β Β Β Β Β Β Β Β Β Β Conditions to Each Distribution.
Β
(a)Β Β Β Β Β Β Β Β Β Β Subject to the applicable provisions of the Merger Agreement, the consummation of each Distribution will be subject to the satisfaction, or waiver by UTC in its sole and
absolute discretion, of the following conditions:
Β
(i)Β Β Β Β Β Β Β Β Β Β The SEC shall have declared effective the applicable Form 10 and the applicable Form 10 shall not be the subject of any stop order or any legal,
Β
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administrative, arbitral or other action, suit, investigation, proceeding, complaint, indictment or litigation by the SEC seeking a stop order.
Β
(ii)Β Β Β Β Β Β The applicable Information Statement shall have been made available to the Record Holders.
Β
(iii)Β Β Β Β Β Β Β UTC shall have received the IRS Ruling, and such IRS Ruling shall continue to be valid as of the applicable Effective Time.
Β
(iv)Β Β Β Β Β Β Β UTC shall have received an opinion from its outside counsel regarding the qualification of certain elements of the applicable Distribution under Section 355
of the Code, and such opinion shall continue to be valid as of the applicable Effective Time.
Β
(v)Β Β Β Β Β Β Β UTC shall have received one or more opinions (which have not been withdrawn or adversely modified) in customary form from one or more nationally recognized
valuation or accounting firms or investment banks as to (A) the adequacy of surplus under Delaware Law with respect to Carrier or Xxxx, as applicable, to effect the Carrier Cash Transfer or Xxxx Xxxx Transfer, as applicable, and with respect to
UTC, to effect the applicable Distribution, and (B) the solvency of each of UTC and, as applicable, Carrier or Otis after giving effect to the foregoing.
Β
(vi)Β Β Β Β Β Β Β The transfer of the Carrier Assets or Otis Assets (other than any Delayed Asset), as applicable, and Carrier Liabilities or Otis Liabilities (other than any
Delayed Liability), as applicable, contemplated to be transferred from UTC or Otis (or the applicable member of their respective Groups) to Carrier (or the applicable member of its Group) or UTC or Carrier (or the applicable member of their
respective Groups) to Otis (or the applicable member of its Group), as applicable, on or prior to the applicable Distribution, and the transfer of the UTC Assets (other than any Delayed Asset) and UTC Liabilities (other than any Delayed
Liability) contemplated to be transferred from Carrier or Xxxx, as applicable, to UTC on or prior to the applicable Distribution, in each case as contemplated by Section 2.1 and pursuant to the Plan of Reorganization, shall have been completed in all material respects.
Β
(vii)Β Β Β Β Β Β The actions and filings necessary or appropriate under applicable U.S. federal, U.S. state or other securities Laws or blue sky Laws and the rules and
regulations thereunder shall have been taken or made and, where applicable, have become effective or been accepted by the applicable Governmental Authority.
Β
(viii)Β Β Β Β Β Each of the Ancillary Agreements shall have been duly executed and delivered by the applicable parties thereto.
Β
(ix)Β Β Β Β Β Β Β No Governmental Authority of competent jurisdiction shall have issued or entered into any injunction or other decree, order, judgment, writ, stipulation,
award or temporary restraining order, and no applicable Law shall have been enacted or promulgated, in each case that (whether temporary or permanent) has the effect of enjoining or otherwise prohibiting the consummation of the Separation, the
applicable Distribution or any of the transactions related thereto.
Β
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(x)Β Β Β Β Β Β Β Β The Carrier Shares, in the case of the Carrier Distribution, or the Otis Shares, in the case of the Otis Distribution, to be distributed to the Record
Holders in the applicable Distribution shall have been accepted for listing on the NYSE, subject to official notice of distribution.
Β
(xi)Β Β Β Β Β Β Β (A) Carrier and/or other members of its Group, in the case of the Carrier Distribution, or Otis and/or the members of its Group, in the case of the Otis
Distribution, shall have assumed or entered into, in the case of the Carrier Distribution, the Carrier Financing Arrangements and incurred at least an aggregate of $11,000,000,000 of new indebtedness pursuant thereto, or in the case of the Otis
Distribution, the Otis Financing Arrangements and incurred at least an aggregate of $6,300,000,000 of new indebtedness pursuant thereto; (B) UTC shall have received the proceeds from the Carrier Cash Transfer in the case of the Carrier
Distribution or the Xxxx Xxxx Transfer in the case of the Otis Distribution; and (C) UTC shall be satisfied in its sole and absolute discretion that it shall have no further Liability whatsoever, in the case of the Carrier Distribution, under the
Carrier Financing Arrangements as of the Carrier Effective Time, or in the case of the Otis Distribution, under the Otis Financing Arrangements, as of the Otis Effective Time.
Β
(xii)Β Β Β Β Β Β No other events or developments shall exist or shall have occurred that, in the judgment of the UTC Board, in its sole and absolute discretion, makes it
inadvisable to effect the Separation, the applicable Distribution or the applicable transactions contemplated by this Agreement or any Ancillary Agreement.
Β
(b)Β Β Β Β Β Β Β Β Β Β The foregoing conditions are for the sole benefit of UTC and shall not give rise to or create any duty on the part of UTC or the UTC Board to waive or not waive any such
condition or in any way limit UTCβs right to terminate this Agreement as set forth in Article IX or alter the consequences of any such termination from those
specified in Article IX.Β Any determination made by the UTC Board prior to the applicable Distribution concerning the satisfaction or waiver of any or all of the
conditions set forth in Section 3.3(a) with respect to such Distribution shall be conclusive and binding on the Parties.Β If UTC waives any material condition, it
shall promptly issue a press release disclosing such fact and file a Current Report on Form 8-K with the SEC describing such waiver.
Β
3.4Β Β Β Β Β Β Β Β Β Β The Distributions.
Β
(a)Β Β Β Β Β Β Β Β Β Β Subject to Section 3.3, on or prior to the applicable Effective Time, Carrier or Xxxx, as
applicable, will deliver to the Distribution Agent, for the benefit of the Record Holders, book-entry transfer authorizations for such number of the outstanding Carrier Shares or Otis Shares as is necessary to effect the Carrier Distribution or
the Otis Distribution, as applicable, and shall cause the transfer agent for the UTC Shares to instruct the Distribution Agent to distribute at the applicable Effective Time the appropriate number of Carrier Shares or Otis Shares, as applicable,
to each such Record Holder or designated transferee or transferees of such Record Holder by way of direct registration in book-entry form.Β Neither Carrier nor Otis will issue paper stock certificates in respect of such Carrier Shares or Otis
Shares, respectively.
Β
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(b)Β Β Β Β Β Β Β Β Β Β Subject to Sections 3.3 and 3.4(c), each Record Holder will be entitled to receive (i) in the Carrier Distribution, a number of whole Carrier Shares equal to the number of UTC Shares held by such Record Holder on the applicable Record Date multiplied by
the Carrier Distribution Ratio, rounded down to the nearest whole number, and (ii) in the Otis Distribution, a number of whole Otis Shares equal to the number of UTC Shares held by such Record Holder on the applicable Record Date multiplied by
the Otis Distribution Ratio, rounded down to the nearest whole number.
Β
(c)Β Β Β Β Β Β Β Β Β Β No fractional shares will be distributed or credited to book-entry accounts in connection with the Distributions, and any such fractional share interests to which a Record
Holder would otherwise be entitled shall not entitle such Record Holder to vote or to any other rights as a shareowner of Carrier or Otis.Β In lieu of any such fractional shares, each Record Holder who, but for the provisions of this Section 3.4(c), would be entitled to receive a fractional share interest of a Carrier Share or an Otis Share pursuant to the applicable Distribution, shall be paid cash, without
any interest thereon, as hereinafter provided.Β As soon as practicable after the applicable Effective Time, UTC shall direct the Distribution Agent to determine the number of whole and fractional Carrier Shares or Otis Shares, as applicable,
allocable to each Record Holder, to aggregate all such fractional shares into whole shares, and to sell the whole shares obtained thereby in the open market at the then prevailing prices on behalf of each Record Holder who otherwise would be
entitled to receive fractional share interests (with the Distribution Agent, in its sole and absolute discretion, determining when, how and through which broker-dealer and at what price to make such sales), and to cause to be distributed to each
such Record Holder, in lieu of any fractional share, such Record Holderβs ratable share of the total proceeds of such sale, after deducting any Taxes required to be withheld and applicable transfer Taxes, and after deducting the costs and
expenses of such sale and distribution, including brokers fees and commissions.Β None of UTC, Xxxxxxx, Xxxx or the Distribution Agent will be required to guarantee any minimum sale price for the fractional Carrier Shares or Otis Shares sold in
accordance with this Section 3.4(c).Β None of UTC, Carrier or Otis will be required to pay any interest on the proceeds from the sale of fractional shares.Β Neither
the Distribution Agent nor the broker-dealers through which the aggregated fractional shares are sold shall be Affiliates of UTC, Carrier or Otis.Β Solely for purposes of computing fractional share interests pursuant to this Section 3.4(c) and Section 3.4(d), the beneficial owner of UTC Shares held of record in the name
of a nominee in any nominee account shall be treated as the Record Holder with respect to such shares.
Β
(d)Β Β Β Β Β Β Β Β Β Β Any Carrier Shares or Otis Shares or cash in lieu of fractional shares with respect to Carrier Shares or Otis Shares that remain unclaimed by any Record Holder one hundred
eighty (180) days after the applicable Distribution Date shall be delivered to Carrier or Otis, respectively, and each of Carrier and Otis, or its transfer agent on its behalf, shall hold such Carrier Shares or Otis Shares, as applicable, and
cash for the account of such Record Holder, and the Parties agree that all obligations to provide such Carrier Shares or Otis Shares, as applicable, and cash, if any, in lieu of fractional share interests shall be obligations of Carrier and Otis,
respectively, subject in each case to applicable escheat or other abandoned property Laws, and UTC shall have no Liability with respect thereto.
Β
(e)Β Β Β Β Β Β Β Β Β Β Until the Carrier Shares and Otis Shares are duly transferred in accordance with this Section 3.4 and applicable Law, from and after the applicable Effective Time, each of
Β
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Carrier and Otis will regard the Persons entitled to receive such Carrier Shares or Otis Shares, as applicable, as record holders of Carrier Shares or Otis Shares, as applicable, in accordance with the terms of the
Distributions without requiring any action on the part of such Persons.Β Each of Carrier and Otis agrees that, subject to any transfers of such shares, from and after the applicable Effective Time, (i) each such holder will be entitled to receive
all dividends, if any, payable on, and exercise voting rights and all other rights and privileges with respect to, the Carrier Shares or Otis Shares, as applicable, then held by such holder, and (ii) each such holder will be entitled, without any
action on the part of such holder, to receive evidence of ownership (as determined by Carrier or Xxxx, as applicable, or their respective transfer agent) of the Carrier Shares or Otis Shares, as applicable, then held by such holder.
Β
ARTICLE IV
MUTUAL RELEASES; INDEMNIFICATION
MUTUAL RELEASES; INDEMNIFICATION
Β
4.1Β Β Β Β Β Β Β Β Β Β Release of Pre-Distribution Claims.
Β
(a)Β Β Β Β Β Β Β Β Β Β Carrier Release of UTC and Otis.Β Except as provided in Sections 4.1(d) and 4.1(e), effective as of the Effective Time, Carrier does hereby, for itself and each other member of the Carrier Group, and their
respective successors and assigns, and, to the extent permitted by Law, all Persons who at any time prior to the Effective Time have been stockholders, directors, officers, agents or employees of any member of the Carrier Group or have served as
directors, officers, agents or employees of another Person at the request of any member of the Carrier Group (in each case, in their respective capacities as such), remise, release and forever discharge (i)Β UTC, Otis and the members of their
respective Groups, and their respective successors and assigns, (ii)Β all Persons who at any time prior to the Effective Time have been stockholders, directors, officers, agents or employees of any member of the UTC Group or the Otis Group or have
served as directors, officers, agents or employees of another Person at the request of any member of the UTC Group or the Otis Group (in each case, in their respective capacities as such), and their respective heirs, executors, administrators,
successors and assigns, and (iii)Β all Persons who at any time prior to the Effective Time are or have been stockholders, directors, officers, agents or employees of a Carrier Transferred Entity or any Subsidiary thereof and who are not, as of
immediately following the Effective Time, directors, officers or employees of Carrier or a member of the Carrier Group (in each case, in their respective capacities as such), in each case from:Β (A)Β all Carrier Liabilities, (B)Β all Liabilities
arising from or in connection with the transactions and all other activities to implement the Separation and the Distributions and (C)Β all Liabilities arising from or in connection with actions, inactions, events, omissions, conditions, facts or
circumstances occurring or existing prior to the Effective Time (whether or not such Liabilities cease being contingent, mature, become known, are asserted or foreseen, or accrue, in each case before, at or after the Effective Time), in each case
to the extent relating to, arising out of or resulting from the Carrier Business, the Carrier Assets, the Carrier Liabilities or any member of the UTC Groupβs or of the Otis Groupβs direct or indirect beneficial ownership of the capital stock of
any member of the Carrier Group or any member of the UTC Groupβs or of the Otis Groupβs management, oversight, supervision or operation of the Carrier Business, the Carrier Assets or the Carrier Liabilities.
Β
(b)Β Β Β Β Β Β Β Β Β Β Otis Release of UTC and Carrier.Β Except as provided in Sections 4.1(d) and 4.1(e), effective as of the Effective Time, Otis does hereby, for itself and each other member
Β
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of the Otis Group, and their respective successors and assigns, and, to the extent permitted by Law, all Persons who at any time prior to the Effective Time have been stockholders, directors, officers, agents or employees
of any member of the Otis Group or have served as directors, officers, agents or employees of another Person at the request of any member of the Otis Group (in each case, in their respective capacities as such), remise, release and forever
discharge (i)Β UTC, Carrier and the members of their respective Groups, and their respective successors and assigns, (ii)Β all Persons who at any time prior to the Effective Time have been stockholders, directors, officers, agents or employees of any
member of the UTC Group or the Carrier Group or have served as directors, officers, agents or employees of another Person at the request of any member of the UTC Group or the Carrier Group (in each case, in their respective capacities as such), and
their respective heirs, executors, administrators, successors and assigns, and (iii)Β all Persons who at any time prior to the Effective Time are or have been stockholders, directors, officers, agents or employees of an Otis Transferred Entity or
any Subsidiary thereof and who are not, as of immediately following the Effective Time, directors, officers or employees of Otis or a member of the Otis Group (in each case, in their respective capacities as such), in each case from:Β (A)Β all Otis
Liabilities, (B)Β all Liabilities arising from or in connection with the transactions and all other activities to implement the Separation and the Distributions and (C)Β all Liabilities arising from or in connection with actions, inactions, events,
omissions, conditions, facts or circumstances occurring or existing prior to the Effective Time (whether or not such Liabilities cease being contingent, mature, become known, are asserted or foreseen, or accrue, in each case before, at or after the
Effective Time), in each case to the extent relating to, arising out of or resulting from the Otis Business, the Otis Assets, the Otis Liabilities or any member of the UTC Groupβs or of the Carrier Groupβs direct or indirect beneficial ownership of
the capital stock of any member of the Otis Group or any member of the UTC Groupβs or of the Carrier GroupβsΒ management, oversight, supervision or operation of the Otis Business, the Otis Assets or the Otis Liabilities.
Β
(c)Β Β Β Β Β Β Β Β Β Β UTC Release of Carrier and Otis.Β Except as provided in Sections 4.1(d) and 4.1(e), effective as of the Effective Time, UTC does hereby, for itself and each other member of the UTC Group, and their respective
successors and assigns, and, to the extent permitted by Law, all Persons who at any time prior to the Effective Time have been stockholders, directors, officers, agents or employees of any member of the UTC Group or have served as directors,
officers, agents or employees of another Person at the request of any member of the UTC Group (in each case, in their respective capacities as such), remise, release and forever discharge (i) Xxxxxxx, Xxxx and the members of their respective
Groups and their respective successors and assigns, and (ii) all Persons who at any time prior to the Effective Time have been stockholders, directors, officers, agents or employees of any member of the Carrier Group or the Otis Group or have
served as directors, officers, agents or employees of another Person at the request of any member of the Carrier Group or the Otis Group (in each case, in their respective capacities as such), and their respective heirs, executors,
administrators, successors and assigns, from (A)Β all UTC Liabilities, (B)Β all Liabilities arising from or in connection with the transactions and all other activities to implement the Separation and the Distributions and (C)Β all Liabilities
arising from or in connection with actions, inactions, events, omissions, conditions, facts or circumstances occurring or existing prior to the Effective Time (whether or not such Liabilities cease being contingent, mature, become known, are
asserted or foreseen, or accrue, in each case before, at or after the Effective Time), in each case to the extent
Β
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relating to, arising out of or resulting from the UTC Business, the UTC Assets or the UTC Liabilities.
Β
(d)Β Β Β Β Β Β Β Β Β Β Obligations Not Affected.Β Nothing contained in Section 4.1(a), 4.1(b) or 4.1(c) shall impair any right of any Person to
enforce this Agreement, any Ancillary Agreement or any agreements, arrangements, commitments or understandings that are specified in Section 2.7(b) or the
applicable Schedules to this Agreement or any Ancillary Agreement as not to terminate as of the Effective Time, in each case in accordance with its terms.Β Nothing contained in Section 4.1(a), 4.1(b) or 4.1(c) shall release any Person from:
Β
(i)Β Β Β Β Β Β Β Β Β Β any Liability provided in or resulting from any agreement among any members of the UTC Group, any members of the Carrier Group or any members of the Otis
Group that is specified in Section 2.7(b) or the applicable Schedules to this Agreement or any Ancillary Agreement as not to terminate as of the Effective Time, or
any other Liability specified in Section 2.7(b) or any Ancillary Agreement as not to terminate as of the Effective Time;
Β
(ii)Β Β Β Β Β Β Β Β any Liability, contingent or otherwise, assumed, transferred, assigned or allocated to the Group of which such Person is a member in accordance with, or
any other Liability of any member of any Group under, this Agreement or any Ancillary Agreement;
Β
(iii)Β Β Β Β Β Β Β any Liability for the sale, lease, construction or receipt of goods, property or services purchased, obtained or used in the ordinary course of business by
a member of any Group from a member of another Group prior to the Effective Time;
Β
(iv)Β Β Β Β Β Β Β any Liability that the Parties may have with respect to indemnification or contribution or other obligation pursuant to this Agreement, any Ancillary
Agreement or otherwise for claims brought against the Parties by Third Parties, which Liability shall be governed by the provisions of this Article IV and Article V and, if applicable, the appropriate provisions of the Ancillary Agreements; or
Β
(v)Β Β Β Β Β Β Β Β any Liability the release of which would result in the release of any Person other than a Person released pursuant to this Section 4.1.
Β
In addition, nothing contained in Section 4.1(a) or Section 4.1(b) shall release any member of the UTC Group from honoring its existing obligations to indemnify any director, officer or employee of Carrier or Otis who was a
director, officer or employee of UTC or any of its Subsidiaries prior to the applicable Effective Time, to the extent such director, officer or employee becomes involved in any Action with respect to which such director, officer or employee was
entitled to such indemnification pursuant to such existing obligations; it being understood that, if the underlying obligation giving rise to such Action is a Carrier Liability or an Otis Liability, Carrier or Otis, respectively, shall indemnify
UTC for such Liability (including UTCβs costs to indemnify the director, officer or employee) in accordance with the provisions set forth in this Article IV.
Β
(e)Β Β Β Β Β Β Β Β Β Β No Claims.Β Carrier shall not make, and shall not permit any other member of the Carrier Group to make, any claim or
demand, or commence any Action asserting any
Β
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claim or demand, including any claim of contribution or any indemnification, against UTC or Otis or any member of their respective Groups, or any other Person released pursuant to Section 4.1(a), with respect to
any Liabilities released pursuant to Section 4.1(a).Β Otis shall not make, and shall not permit any other member of the Otis Group to make, any claim or demand, or commence any Action asserting any claim or demand, including any claim of
contribution or any indemnification, against UTC or Carrier or any member of their respective Groups, or any other Person released pursuant to Section 4.1(b), with respect to any Liabilities released pursuant to Section 4.1(b).Β UTC
shall not make, and shall not permit any other member of the UTC Group to make, any claim or demand, or commence any Action asserting any claim or demand, including any claim of contribution or any indemnification, against Carrier or Otis or any
member of their respective Groups, or any other Person released pursuant to Section 4.1(c), with respect to any Liabilities released pursuant to Section 4.1(c).
Β
(f)Β Β Β Β Β Β Β Β Β Β Execution of Further Releases.Β At any time at or after the Effective Time, at the request of any Party, the other
Parties shall cause each member of their respective Groups to execute and deliver releases reflecting the provisions of this Section 4.1.
Β
4.2Β Β Β Β Β Β Β Β Β Β Indemnification by Carrier.Β Except as otherwise specifically set forth in this Agreement or in any Ancillary Agreement, to the fullest extent
permitted by Law, Carrier shall, and shall cause the other members of the Carrier Group to, indemnify, defend and hold harmless (x) UTC, each member of the UTC Group and each of their respective past, present and future directors, officers,
employees and agents, in each case in their respective capacities as such, and each of the heirs, executors, successors and assigns of any of the foregoing (collectively, the βUTC Indemniteesβ), and (y) Otis, each member of the Otis Group
and each of their respective past, present and future directors, officers, employees and agents, in each case in their respective capacities as such, and each of the heirs, executors, successors and assigns of any of the foregoing (collectively,
the βOtis Indemniteesβ), from and against any and all Liabilities of the UTC Indemnitees and the Otis Indemnitees, respectively, relating to, arising out of or resulting from, directly or indirectly, any of the following items (without
duplication):
Β
(a)Β Β Β Β Β Β Β Β Β Β any Carrier Liability;
Β
(b)Β Β Β Β Β Β Β Β Β Β any failure of Carrier, any other member of the Carrier Group or any other Person to pay, perform or otherwise promptly discharge any
Carrier Liabilities in accordance with their terms, whether prior to, on or after the Effective Time;
Β
(c)Β Β Β Β Β Β Β Β Β Β any breach by Carrier or any other member of the Carrier Group of this Agreement or any of the Ancillary Agreements;
Β
(d)Β Β Β Β Β Β Β Β Β Β except to the extent it relates to a UTC Liability or Otis Liability, any guarantee, indemnification or contribution obligation, surety
bond or other credit support agreement, arrangement, commitment or understanding for the benefit of any member of the Carrier Group by any member of the UTC Group or the Otis Group, respectively, that survives following the Effective Time; and
Β
(e)Β Β Β Β Β Β Β Β Β Β any untrue statement or alleged untrue statement of a material fact or omission or alleged omission to state a material fact required to
be stated therein or necessary to
Β
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make the statements therein not misleading, with respect to (i) all Information contained in the Carrier Form 10, the Carrier Information Statement or any other Carrier Disclosure Document, other than the matters
described in Section 4.3(e)(ii)(y) or Section 4.4(e); and (ii) any Information in respect of Carrier, any member of the Carrier Group, the Carrier Separation, the Carrier Distribution, the Carrier Business, the Carrier Assets or the
Carrier Liabilities in (x) any UTC Disclosure Document filed or initially distributed or initially made available prior to the Carrier Distribution Date or that includes Information in respect of a quarterly or annual fiscal period of UTC that
begins on or prior to the Carrier Distribution Date or (y) the Otis Form 10, the Otis Information Statement or any other Otis Disclosure Document.
Β
4.3Β Β Β Β Β Β Β Β Β Β Indemnification by Otis.Β Except as otherwise specifically set forth in this Agreement or in any Ancillary Agreement, to the fullest extent
permitted by Law, Otis shall, and shall cause the other members of the Otis Group to, indemnify, defend and hold harmless (x) the UTC Indemnitees and (y) Carrier, each member of the Carrier Group and each of their respective past, present and
future directors, officers, employees and agents, in each case in their respective capacities as such, and each of the heirs, executors, successors and assigns of any of the foregoing (collectively, the βCarrier Indemniteesβ), from and
against any and all Liabilities of the UTC Indemnitees and the Carrier Indemnitees, respectively, relating to, arising out of or resulting from, directly or indirectly, any of the following items (without duplication):
Β
(a)Β Β Β Β Β Β Β Β Β Β any Otis Liability;
Β
(b)Β Β Β Β Β Β Β Β Β Β any failure of Otis, any other member of the Otis Group or any other Person to pay, perform or otherwise promptly discharge any Otis
Liabilities in accordance with their terms, whether prior to, on or after the Effective Time;
Β
(c)Β Β Β Β Β Β Β Β Β Β any breach by Otis or any other member of the Otis Group of this Agreement or any of the Ancillary Agreements;
Β
(d)Β Β Β Β Β Β Β Β Β Β except to the extent it relates to a UTC Liability or Carrier Liability, any guarantee, indemnification or contribution obligation, surety
bond or other credit support agreement, arrangement, commitment or understanding for the benefit of any member of the Otis Group by any member of the UTC Group or the Carrier Group, respectively, that survives following the Effective Time; and
Β
(e)Β Β Β Β Β Β Β Β Β Β any untrue statement or alleged untrue statement of a material fact or omission or alleged omission to state a material fact required to
be stated therein or necessary to make the statements therein not misleading, with respect to (i) all Information contained in the Otis Form 10, the Otis Information Statement or any other Otis Disclosure Document, other than the matters
described in Section 4.2(e)(ii)(y) or Section 4.4(e); and (ii) any Information in
respect of Otis, any member of the Otis Group, the Otis Separation, the Otis Distribution, the Otis Business, the Otis Assets or the Otis Liabilities in (x) any UTC Disclosure Document filed or initially distributed or initially made available
prior to the Otis Distribution Date or that includes Information in respect of a quarterly or annual fiscal period of UTC that begins on or prior to the Otis Distribution Date or (y) the Carrier Form 10, the Carrier Information Statement or any
other Carrier Disclosure Document.
Β
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4.4Β Β Β Β Β Β Β Β Β Β Indemnification by UTC.Β Except as otherwise specifically set forth in this Agreement or in any Ancillary Agreement, to the fullest extent
permitted by Law, UTC shall, and shall cause the other members of the UTC Group to, indemnify, defend and hold harmless (x) the Carrier Indemnitees and (y) the Otis Indemnitees from and against any and all Liabilities of the Carrier Indemnitees and
the Otis Indemnitees, respectively, relating to, arising out of or resulting from, directly or indirectly, any of the following items (without duplication):
Β
(a)Β Β Β Β Β Β Β Β Β Β any UTC Liability;
Β
(b)Β Β Β Β Β Β Β Β Β Β any failure of UTC, any other member of the UTC Group or any other Person to pay, perform or otherwise promptly discharge any UTC
Liabilities in accordance with their terms, whether prior to, on or after the Effective Time;
Β
(c)Β Β Β Β Β Β Β Β Β Β any breach by UTC or any other member of the UTC Group of this Agreement or any of the Ancillary Agreements;
Β
(d)Β Β Β Β Β Β Β Β Β Β except to the extent it relates to a Carrier Liability or Otis Liability, any guarantee, indemnification or contribution obligation,
surety bond or other credit support agreement, arrangement, commitment or understanding for the benefit of any member of the UTC Group by any member of the Carrier Group or the Otis Group that survives following the Effective Time; and
Β
(e)Β Β Β Β Β Β Β Β Β Β any untrue statement or alleged untrue statement of a material fact or omission or alleged omission to state a material fact required to
be stated therein or necessary to make the statements therein not misleading, with respect to statements (i) made explicitly in UTCβs name in the Carrier Form 10 or the Otis Form 10, the Carrier Information Statement or the Otis Information
Statement, or any other Carrier Disclosure Document or Otis Disclosure Document; it being agreed that the statements set forth on Schedule 4.4(e)Β shall be the only
statements made explicitly in UTCβs name in the Form 10s, the Information Statements or any other Carrier Disclosure Document or Otis Disclosure Document, and all other Information contained in the Form 10s, the Information Statements or any
other Carrier Disclosure Document or Otis Disclosure Document shall be deemed to be Information supplied by Carrier or Xxxx, as applicable, or (ii) made in any UTC Disclosure Document, other than the matters described in Section 4.2(e)(ii)(x) or Section 4.3(e)(ii)(x).
Β
4.5Β Β Β Β Β Β Β Β Β Β Indemnification Obligations Net of Insurance Proceeds and Other Amounts.
Β
(a)Β Β Β Β Β Β Β Β Β Β The Parties intend that any Liability subject to indemnification, contribution or reimbursement pursuant to this Article IV or Article V will be net of Insurance Proceeds or other amounts in either case actually recovered (net of any out-of-pocket costs or
expenses incurred in the collection thereof) from any Person by or on behalf of the Indemnitee in respect of any indemnifiable Liability.Β Accordingly, the amount that any Party (an βIndemnifying Partyβ) is required to pay to any Person entitled to indemnification or contribution hereunder (an βIndemniteeβ) will be reduced by any Insurance
Proceeds or other amounts in either case actually recovered (net of any out-of-pocket costs or expenses incurred in the collection thereof) from any Person by or on behalf of the Indemnitee in respect of the related
Β
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Liability.Β If an Indemnitee receives a payment (an βIndemnity Paymentβ) required by this Agreement from an Indemnifying Party in respect of any Liability and subsequently receives Insurance Proceeds or any other
amounts in respect of such Liability, then within ten (10) calendar days of receipt of such Insurance Proceeds, the Indemnitee will pay to the Indemnifying Party an amount equal to the excess of the Indemnity Payment received over the amount of the
Indemnity Payment that would have been due if the Insurance Proceeds or such other amounts (net of any out-of-pocket costs or expenses incurred in the collection thereof) had been received, realized or recovered before the Indemnity Payment was
made.
Β
(b)Β Β Β Β Β Β Β Β Β Β The Parties agree that an insurer that would otherwise be obligated to pay any claim shall not be relieved of the responsibility with respect thereto or, solely by virtue of
any provision contained in this Agreement or any Ancillary Agreement, have any subrogation rights with respect thereto, it being understood that no insurer or any other Third Party shall be entitled to a βwindfallβ (i.e., a benefit it would not be entitled to receive in the absence of the indemnification provisions) by virtue of the indemnification and contribution provisions hereof. Each Party shall, and
shall cause the members of its Group to, use commercially reasonable efforts (taking into account the probability of success on the merits and the cost of expending such efforts, including attorneysβ fees and expenses) to collect or recover any
Insurance Proceeds that may be collectible or recoverable respecting the Liabilities for which indemnification or contribution may be available under this Article IV.Β
Notwithstanding the foregoing, an Indemnifying Party may not delay making any indemnification payment required under the terms of this Agreement, or otherwise satisfying any indemnification obligation, pending the outcome of any Action to collect
or recover Insurance Proceeds, and an Indemnitee need not attempt to collect any Insurance Proceeds prior to making a claim for indemnification or contribution or receiving any Indemnity Payment otherwise owed to it under this Agreement or any
Ancillary Agreement.
Β
4.6Β Β Β Β Β Β Β Β Β Β Procedures for Indemnification of Third-Party Claims.
Β
(a)Β Β Β Β Β Β Β Β Β Β Notice of Claims.Β If, at or following the Effective Time, an Indemnitee shall receive notice or otherwise learn of
the assertion by a Person (including any Governmental Authority) who is not a member of the UTC Group, the Carrier Group or the Otis Group of any claim or of the commencement by any such Person of any Action (collectively, a βThird-Party Claimβ) with respect to which an Indemnifying Party may be obligated to provide indemnification to such Indemnitee pursuant to Sections
4.2, 4.3 or 4.4, or any other Section
of this Agreement or any Ancillary Agreement, such Indemnitee shall give such Indemnifying Party written notice thereof as soon as practicable, but in any event within twenty-one (21) days (or sooner if the nature of the Third-Party Claim so
requires) after becoming aware of such Third-Party Claim.Β Any such notice shall describe the Third-Party Claim in reasonable detail, including the facts and circumstances giving rise to such claim for indemnification and include copies of all
material notices and documents (including court papers) received by the Indemnitee relating to the Third-Party Claim.Β Notwithstanding the foregoing, the failure of an Indemnitee to provide timely notice in accordance with this Section 4.6(a) shall not relieve an Indemnifying Party of its indemnification obligations under this Agreement, except to the extent to which the Indemnifying Party is materially
prejudiced by the Indemniteeβs failure to provide notice in accordance with this Section 4.6(a).
Β
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(b)Β Β Β Β Β Β Β Β Β Β Control of Defense.Β An Indemnifying Party may elect to defend (and seek to settle or compromise), at its own expense
and with its own counsel, any Third-Party Claim; provided, that, prior to the Indemnifying Party assuming and controlling defense of such Third-Party Claim, it
shall first confirm to the Indemnitee in writing that, assuming the facts presented to the Indemnifying Party by the Indemnitee are true, the Indemnifying Party shall indemnify the Indemnitee for any such damages to the extent resulting from, or
arising out of, such Third-Party Claim.Β Notwithstanding the foregoing, if the Indemnifying Party assumes such defense, and, in the course of defending such Third-Party Claim, (i) the Indemnifying Party discovers that the facts presented at the
time the Indemnifying Party acknowledged its indemnification obligation in respect of such Third-Party Claim were not true in all material respects and (ii) such untruth provides a reasonable basis for asserting that the Indemnifying Party does
not have an indemnification obligation in respect of such Third-Party Claim, then (A) the Indemnifying Party shall not be bound by such acknowledgment, (B) the Indemnifying Party shall promptly thereafter provide the Indemnitee written notice of
its assertion that it does not have an indemnification obligation in respect of such Third-Party Claim, and (C) the Indemnitee shall have the right to assume the defense of such Third-Party Claim.Β Within thirty (30) days after the receipt of a
notice from an Indemnitee in accordance with Section 4.6(a) (or sooner, if the nature of the Third-Party Claim so requires), the Indemnifying Party shall provide
written notice to the Indemnitee indicating whether the Indemnifying Party shall assume responsibility for defending the Third-Party Claim.Β If an Indemnifying Party elects not to assume responsibility for defending any Third-Party Claim or fails
to notify an Indemnitee of its election within thirty (30) days after receipt of the notice from an Indemnitee as provided in Section 4.6(a), then the Indemnitee
that is the subject of such Third-Party Claim shall be entitled to continue to conduct and control the defense of such Third-Party Claim.
Β
(c)Β Β Β Β Β Β Β Β Β Β Allocation of Defense Costs.Β If an Indemnifying Party has elected to assume the defense of a Third-Party Claim, then
such Indemnifying Party shall be solely liable for all fees and expenses (including attorneysβ fees) incurred by it in connection with the defense of such Third-Party Claim and shall not be entitled to seek any indemnification or reimbursement
from the Indemnitee for any such fees or expenses (including attorneysβ fees) incurred by the Indemnifying Party during the course of the defense of such Third-Party Claim by such Indemnifying Party, regardless of any subsequent decision by the
Indemnifying Party to reject or otherwise abandon its assumption of such defense.Β If an Indemnifying Party elects not to assume responsibility for defending any Third-Party Claim, or fails to notify an Indemnitee of its election within thirty
(30) days after receipt of a notice from an Indemnitee as provided in Section 4.6(a), and the Indemnitee conducts and controls the defense of such Third-Party Claim
and the Indemnifying Party has an indemnification obligation with respect to such Third-Party Claim, then the Indemnifying Party shall be liable for all reasonable, documented fees and expenses incurred by the Indemnitee in connection with the
defense of such Third-Party Claim.
Β
(d)Β Β Β Β Β Β Β Β Β Β Right to Monitor and Participate.Β An Indemnitee that does not conduct and control the defense of any Third-Party
Claim, or an Indemnifying Party that does not elect or is not entitled to defend any Third-Party Claim as contemplated hereby, nevertheless shall have the right to employ separate counsel (including local counsel as necessary) of its own choosing
to monitor and participate in (but not control) the defense of any Third-Party Claim for which it is a potential Indemnitee or Indemnifying Party, but the fees and expenses of such counsel shall be at the expense of such Indemnitee or
Indemnifying Party, as the case may be, and the
Β
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provisions of Section 4.6(c) shall not apply to such fees and expenses.Β Notwithstanding the foregoing, but subject to Sections 6.7 and 6.8, such Party shall cooperate with the Party entitled to
conduct and control the defense of such Third-Party Claim in such defense and make available to the controlling Party, at the non-controlling Partyβs expense, all witnesses, Information and materials in such Partyβs possession or under such Partyβs
control relating thereto as are reasonably required by the controlling Party.Β In addition to the foregoing, if any Indemnitee reasonably determines in good faith that such Indemnitee and the Indemnifying Party have actual or potential differing
defenses or conflicts of interest between them that make joint representation inappropriate, then the Indemnitee shall have the right to employ separate counsel (including local counsel as reasonably necessary) and to participate in (but not
control) the defense, compromise or settlement thereof, and in such case the Indemnifying Party shall bear the reasonable fees and expenses of such counsel for the applicable Indemnitee.
Β
(e)Β Β Β Β Β Β Β Β Β Β No Settlement.Β None of the Parties may settle or compromise any Third-Party Claim for which any Party is seeking to
be indemnified hereunder without the prior written consent of the other Parties who are Indemnifying Parties or are or are seeking to be Indemnitees, as applicable, in respect of such Third-Party Claim, which consent may not be unreasonably
withheld, conditioned or delayed, unless such settlement or compromise is solely for monetary damages that are fully payable by the settling or compromising Party; does not involve any admission, finding or determination of wrongdoing or
violation of Law by any such other Party; and provides for a full, unconditional and irrevocable release of any such other Party from all Liability in connection with the Third-Party Claim.Β The Parties hereby agree that if a Party delivers to
another Party a written notice containing a proposal to settle or compromise a Third-Party Claim for which such receiving Party is an Indemnifying Party or is or is seeking to be an Indemnitee in respect of such Third-Party Claim, and the Party
receiving such proposal does not respond in any manner to the Party presenting such proposal within twenty (20) days (or within any such shorter time period that may be required by applicable Law or court order) of receipt of such proposal, then
the Party receiving such proposal shall be deemed to have consented to the terms of such proposal.
Β
(f)Β Β Β Β Β Β Β Β Β Β Tax Matters Agreement Coordination.Β The provisions of Sections 4.6 through 4.10 (other than this Section 4.6(f)) shall not
apply with respect to Taxes and Tax matters (it being understood and agreed that Taxes and Tax matters, including the control of Tax-related proceedings, shall be governed by the Tax Matters Agreement).
Β
4.7Β Β Β Β Β Β Β Β Β Β Additional Matters.
Β
(a)Β Β Β Β Β Β Β Β Β Β Timing of Payments.Β Indemnification or contribution payments in respect of any Liabilities for which an Indemnitee
is entitled to indemnification or contribution under this Article IV shall be paid reasonably promptly (but in any event within forty-five (45) days of the final
determination of the amount that the Indemnitee is entitled to indemnification or contribution under this Article IV) by the Indemnifying Party to the Indemnitee as
such Liabilities are incurred upon demand by the Indemnitee, including reasonably satisfactory documentation setting forth the basis for the amount of such indemnification or contribution payment, including documentation with respect to
calculations made and consideration of any Insurance Proceeds that actually reduce the amount of such Liabilities.Β The indemnity and contribution provisions contained in this Article IV shall remain operative and in full force and
Β
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effect, regardless of (i) any investigation made by or on behalf of any Indemnitee and (ii) the knowledge by the Indemnitee of Liabilities for which it might be entitled to indemnification hereunder.
Β
(b)Β Β Β Β Β Β Β Β Β Β Notice of Direct Claims.Β Any claim for indemnification or contribution under this Agreement or any Ancillary
Agreement that does not result from a Third-Party Claim shall be asserted by written notice given by the Indemnitee to the applicable Indemnifying Party.Β Such Indemnifying Party shall have a period of thirty (30) days after the receipt of such
notice within which to respond thereto.Β If such Indemnifying Party does not respond within such thirty (30)-day period, such specified claim shall be conclusively deemed a Liability of the Indemnifying Party under this Section 4.7(b) or, in the case of any written notice in which the amount of the claim (or any portion thereof) is estimated, on such later date when the amount of the claim (or
such portion thereof) becomes finally determined.Β If such Indemnifying Party does not respond within such thirty (30)-day period or rejects such claim in whole or in part, such Indemnitee shall, subject to the provisions of Article VII, be free to pursue such remedies as may be available to such Party as contemplated by this Agreement and the Ancillary Agreements, as applicable, without prejudice to
its continuing rights to pursue indemnification or contribution hereunder.
Β
(c)Β Β Β Β Β Β Β Β Β Β Pursuit of Claims Against Third Parties.Β If (i) a Party incurs any Liability arising out of this Agreement or any
Ancillary Agreement; (ii) an adequate legal or equitable remedy is not available for any reason against another Party to satisfy the Liability incurred by the incurring Party; and (iii) a legal or equitable remedy may be available to another
Party against a Third Party for such Liability, then such other Party, or Parties, as applicable, shall use its or their commercially reasonable efforts to cooperate with the incurring Party, at the incurring Partyβs expense, to permit the
incurring Party to obtain the benefits of such legal or equitable remedy against the Third Party.
Β
(d)Β Β Β Β Β Β Β Β Β Β Subrogation.Β In the event of payment by or on behalf of any Indemnifying Party to any Indemnitee in connection with
any Third-Party Claim, such Indemnifying Party shall be subrogated to and shall stand in the place of such Indemnitee as to any events or circumstances in respect of which such Indemnitee may have any right, defense or claim relating to such
Third-Party Claim against any claimant or plaintiff asserting such Third-Party Claim or against any other Person.Β Such Indemnitee shall cooperate with such Indemnifying Party in a reasonable manner, and at the cost and expense of such
Indemnifying Party, in prosecuting any subrogated right, defense or claim.
Β
(e)Β Β Β Β Β Β Β Β Β Β Substitution.Β In the event of an Action in which the Indemnifying Party is not a named defendant, if either the
Indemnitee or Indemnifying Party shall so request, the Parties shall endeavor to substitute the Indemnifying Party for the named defendant.Β If such substitution or addition cannot be achieved for any reason or is not requested, the named
defendant shall allow the Indemnifying Party to manage the Action as set forth in Section 4.6 and this Section 4.7.
Β
4.8Β Β Β Β Β Β Β Β Β Β Right of Contribution.
Β
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(a)Β Β Β Β Β Β Β Β Β Β Contribution.Β If any right of indemnification contained in Section 4.2, Section 4.3 or Section 4.4 is held unenforceable or is
unavailable for any reason, or is insufficient to hold harmless an Indemnitee in respect of any Liability for which such Indemnitee is entitled to indemnification hereunder, then the Indemnifying Party shall contribute to the amounts paid or
payable by the Indemnitees as a result of such Liability (or Actions in respect thereof) in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party and the members of its Group, on the one hand, and the
Indemnitees entitled to contribution, on the other hand, as well as any other relevant equitable considerations.
Β
(b)Β Β Β Β Β Β Β Β Β Β Allocation of Relative Fault.Β Solely for purposes of determining relative fault pursuant to this Section 4.8:Β (i) any fault associated with (A) the business conducted with the Delayed Assets or Delayed Liabilities of Carrier or Otis (except for the gross negligence or
intentional misconduct of (1) a member of the UTC Group or (2) (x) in the case of the business conducted with the Delayed Assets or Delayed Liabilities of Carrier, a member of the Otis Group, or (y) in the case of the business conducted with the
Delayed Assets or Delayed Liabilities of Otis, a member of the Carrier Group) or (B) the ownership, operation or activities of the Carrier Business or Xxxx Business prior to the Effective Time shall be deemed to be the fault of Carrier and the
other members of the Carrier Group or Otis and the other members of the Otis Group, respectively, and no such fault shall be deemed to be the fault of (1) UTC or any other member of the UTC Group or (2) (x) in the case of the ownership, operation
or activities of the Carrier Business, Otis or any other member of the Otis Group or (y) in the case of the ownership, operation or activities of the Xxxx Business, Carrier or any other member of the Carrier Group; and (ii) any fault associated
with (A) the business conducted with Delayed Assets or Delayed Liabilities of UTC (except for the gross negligence or intentional misconduct of a member of the Carrier or Otis Group) or (B) the ownership, operation or activities of the UTC
Business prior to the Effective Time shall be deemed to be the fault of UTC and the other members of the UTC Group, and no such fault shall be deemed to be the fault of Xxxxxxx, Xxxx or any other member of their respective Groups.
Β
4.9Β Β Β Β Β Β Β Β Β Β Covenant Not to Xxx.Β Each Party hereby covenants and agrees that none of it, the members of such Partyβs Group or any Person claiming through it
shall bring suit or otherwise assert any claim against any Indemnitee, or assert a defense against any claim asserted by any Indemnitee, before any court, arbitrator, mediator or administrative agency anywhere in the world, alleging that:Β (a) the
assumption or retention of any Carrier Liabilities by Carrier or a member of the Carrier Group on the terms and conditions set forth in this Agreement and the Ancillary Agreements is void or unenforceable for any reason; (b) the assumption or
retention of any Otis Liabilities by Otis or a member of the Otis Group on the terms and conditions set forth in this Agreement and the Ancillary Agreements is void or unenforceable for any reason; (c) the assumption or retention of any UTC
Liabilities by UTC or a member of the UTC Group on the terms and conditions set forth in this Agreement and the Ancillary Agreements is void or unenforceable for any reason; or (d) the provisions of this Article IV are void or unenforceable
for any reason.
Β
4.10Β Β Β Β Β Β Β Β Β Β Remedies Cumulative.Β The remedies provided in this Article IV shall be cumulative and, subject to the provisions of Article VIII,
shall not preclude assertion by any Indemnitee of any other rights or the seeking of any and all other remedies against any Indemnifying Party.
Β
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4.11Β Β Β Β Β Β Β Β Β Β Survival of Indemnities.Β The rights and obligations of each of UTC, Carrier and Otis and their respective Indemnitees under this Article IV
shall survive (a)Β the sale or other transfer by any of the Parties or any member of their respective Groups of any assets or businesses or the assignment by any of the Parties of any Liabilities; or (b)Β any merger, consolidation, business
combination, sale of all or substantially all of its Assets, restructuring, recapitalization, reorganization or similar transaction involving any of the Parties or any members of their respective Groups; it being understood that in any such case,
the applicable Party shall make proper provision so that the successor or acquiror, as applicable, expressly assumes the obligations of such Party set forth this Article IV.
Β
ARTICLE V
CERTAIN OTHER MATTERS
CERTAIN OTHER MATTERS
Β
5.1Β Β Β Β Β Β Β Β Β Β Insurance Matters.
Β
(a)Β Β Β Β Β Β Β Β Β Β In no event shall UTC, any other member of the UTC Group or any UTC Indemnitee have any Liability or obligation whatsoever to any member of the Carrier Group or the Otis Group
in the event that any insurance policy or insurance policy-related contract has been or is terminated or otherwise ceases to be in effect for any reason, is or becomes unavailable or inadequate to cover any Liability of any member of the Carrier
Group or the Otis Group for any reason whatsoever or has not been or is not renewed or extended beyond the current expiration date.
Β
(b)Β Β Β Β Β Β Β Β Β Β Except as provided on Schedule 5.1(b) and except in the circumstances where Section 5.1(c) is applicable, with respect to any losses, damages and Liabilities incurred by any member of the Carrier Group or the Otis Group prior to the Applicable
Third-Party Insurance Separation Date relating to such type of losses, damages and Liabilities, UTC will provide each of Carrier and Otis with access to, and each of Carrier and Otis may make occurrence-based claims under, UTCβs Third-Party
occurrence-based insurance policies in place immediately prior to the Applicable Third-Party Insurance Separation Date and UTCβs historical Third-Party occurrence-based insurance policies (to the extent then remaining available), but solely to
the extent that such policies provided coverage for members of the Carrier Group or the Carrier Business or members of the Otis Group or the Xxxx Business, respectively, for occurrence-based claims prior to the Applicable Third-Party Insurance
Separation Date; provided, that Carrier and Otis shall access and make occurrence-based claims under such insurance policies in good faith and in a manner
consistent with past practice; provided, further, that such access to, and the
right to make occurrence-based claims under, such insurance policies, shall be subject to the terms, conditions and exclusions of such insurance policies, including any limits on coverage or scope, any deductibles, self-insured retentions and
other fees and expenses, and shall be subject to the following additional conditions:
Β
(i)Β Β Β Β Β Β Β Β Β Β Carrier or Otis shall notify UTC, as promptly as practicable, of any claim made by it pursuant to this Section
5.1(b);
Β
(ii)Β Β Β Β Β Β Β Β Carrier or Otis and the members of their respective Groups shall indemnify, hold harmless and reimburse UTC and the members of the UTC Group for any
deductibles, self-insured retention, fees, indemnity payments, settlements, judgments,
Β
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legal fees, allocated claims expenses and claim handling fees, and other expenses incurred by UTC or any member of the UTC Group to the extent resulting from any access to, or any claims made by Carrier
or Otis or any other members of their respective Groups under, any insurance provided pursuant to this Section 5.1(b), whether such claims are made by Carrier, its employees or any Third Parties or Otis, its employees or any Third Parties,
as applicable; and
Β
(iii)Β Β Β Β Β Β Β Each of Carrier and Otis shall exclusively bear (and neither UTC nor any member of the UTC Group shall have any obligation to repay or reimburse Carrier or
Otis or any member of their respective Groups for) and shall be liable for all excluded, uninsured, uncovered, unavailable or uncollectible amounts of all such claims made by it or any member of its Group under the policies as provided for in
this Section 5.1(b).
Β
In the event that (A) any member of the UTC Group incurs any losses, damages or Liability prior to or in respect of the period prior to the Applicable Third-Party Insurance Separation Date for which such member of the UTC
Group is entitled to coverage under any Third-Party occurrence-based insurance policies of Carrier or Otis or any member of their respective Groups, (B) any member of the Carrier Group incurs any losses, damages or Liability prior to or in respect
of the period prior to the Applicable Third-Party Insurance Separation Date for which such member of the Carrier Group is entitled to coverage under any Third-Party occurrence-based insurance policies of Xxxx or any member of its Group, or (C) any
member of the Otis Group incurs any losses, damages or Liability prior to or in respect of the period prior to the Applicable Third-Party Insurance Separation Date for which such member of the Otis Group is entitled to coverage under any
Third-Party occurrence-based insurance policies of Carrier or any member of its Group, then the terms of this Section 5.1(b), Section 5.1(e) and Section 5.1(f) shall apply, mutatis mutandis.
Β
(c)Β Β Β Β Β Β Β Β Β Β From and after the Effective Time, with respect to any Carrier Captive Liabilities or any Otis Captive Liabilities incurred prior to the Effective Time with respect to which
the UTC Captive Entities retain Third-Party insurance or reinsurance coverage, the UTC Captive Entities will provide each of Carrier and Otis with access to, and each of Carrier and Otis may make claims under, the UTC Captive Entitiesβ
Third-Party insurance or reinsurance policies in place immediately prior to the Effective Time and the UTC Captive Entitiesβ historical Third-Party insurance or reinsurance policies (in each case, solely to the extent coverage remains available),
but solely to the extent that such policies provided coverage for such Carrier Captive Liabilities or Otis Captive Liabilities, as applicable; provided, that
Carrier and Otis shall access and make claims under such insurance or reinsurance policies in good faith and in a manner consistent with past practice; provided, further, that such access to, and the right to make claims under, such insurance or reinsurance policies, shall be subject to the terms, conditions and exclusions of such
insurance or reinsurance policies, including any limits on coverage or scope, any deductibles, self-insured retentions and other fees and expenses, and shall be subject to the following additional conditions:
Β
(i)Β Β Β Β Β Β Β Β Β Β Carrier or Otis shall notify UTC, as promptly as practicable, of any claim made by it pursuant to this Section
5.1(c);
Β
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(ii)Β Β Β Β Β Β Β Β Carrier or Otis and the members of their respective Groups shall indemnify, hold harmless and reimburse UTC and the members of the UTC Group for any
deductibles, self-insured retention, fees, indemnity payments, settlements, judgments, legal fees, allocated claims expenses and claim handling fees, and other expenses incurred by UTC or any member of the UTC Group to the extent resulting from
any access to, or any claims made by Carrier or Otis or any other members of their respective Groups under, any insurance provided pursuant to this Section 5.1(c),
whether such claims are made by Carrier, its employees or any Third Parties or Otis, its employees or any Third Parties, as applicable; and
Β
(iii)Β Β Β Β Β Β Β each of Carrier and Otis shall exclusively bear (and neither UTC nor any member of the UTC Group shall have any obligation to repay or reimburse Carrier or
Otis or any member of their respective Groups for) and shall be liable for all excluded, uninsured, uncovered, unavailable or uncollectible amounts of all such claims made by it or any member of its Group under the policies as provided for in
this Section 5.1(c).
Β
(d)Β Β Β Β Β Β Β Β Β Β Except as expressly provided in Sections 5.1(b) and 5.1(c), none of UTC, Xxxxxxx, Xxxx or any member of their respective Groups shall have any rights to or under any of the insurance or reinsurance policies of the other Parties or any other member of their respective Groups,
including, with respect to Carrier or Otis, any rights to or under, or any recourse to, any Assets or insurance policies or programs of any UTC Captive Entity.Β At the Effective Time, each of Carrier and Otis shall have in effect all insurance
programs required to comply with its contractual obligations and such other insurance or reinsurance policies or insurance contracts required by Law or as reasonably necessary or appropriate for companies operating a business similar to Carrierβs
or Otisβs, respectively.Β For the avoidance of doubt, from and after the applicable Effective Time, neither UTC nor any member of its Group (including any UTC Captive Entity) shall have any Liability or obligation whatsoever with respect to any
Carrier Captive Liabilities or any Otis Captive Liabilities, each of which shall be Carrier Liabilities or Otis Liabilities, respectively, for all purposes hereunder.
Β
(e)Β Β Β Β Β Β Β Β Β Β None of Xxxxxxx, Xxxx or any member of their respective Groups, in connection with making a claim under any insurance or reinsurance policy of UTC or any member of the UTC
Group pursuant to this Section 5.1, shall take any action that would be reasonably likely to (i) have a material and adverse impact on the then-current relationship
between UTC or any member of the UTC Group, on the one hand, and the applicable insurance company, on the other hand; (ii) result in the applicable insurance company terminating or materially reducing coverage, or materially increasing the amount
of any premium owed by UTC or any member of the UTC Group under the applicable insurance or reinsurance policy; or (iii) otherwise compromise, jeopardize or interfere in any material respect with the rights of UTC or any member of the UTC Group
under the applicable insurance or reinsurance policy.
Β
(f)Β Β Β Β Β Β Β Β Β Β All payments and reimbursements by Carrier or Otis pursuant to this Section 5.1 will be made
within forty-five (45) days after its receipt of an invoice therefor from UTC.Β UTC shall retain the exclusive right to control its insurance or reinsurance policies and programs (the βControl Rightβ), including the right to exhaust, settle, release, commute, buyback or otherwise resolve disputes with respect to any of its insurance or reinsurance policies and
Β
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programs and to amend, modify or waive any rights under any such insurance or reinsurance policies and programs, notwithstanding whether any such policies or programs apply to any Carrier Liabilities or Otis Liabilities
and/or claims Carrier or Otis has made or could make in the future; provided that UTC does not exercise the Control Right with the specific and primary purpose of depriving Carrier or Otis of the ability to access or make claims under such
policies and programs pursuant to this Section 5.1.Β Except to the extent in the exercise of such Personβs express rights pursuant to this Section 5.1, no member of the Carrier Group or the Otis Group shall erode, exhaust, settle,
release, commute, buyback or otherwise resolve disputes with UTCβs insurers with respect to any of UTCβs insurance or reinsurance policies and programs, or amend, modify or waive any rights under any such insurance or reinsurance policies and
programs.Β Each of Carrier and Otis shall cooperate with UTC and share such Information as is reasonably necessary in order to permit UTC to manage and conduct its insurance matters as UTC deems appropriate.Β For the avoidance of doubt,
notwithstanding the foregoing, each Party and any member of its applicable Group has the sole right to settle or otherwise resolve any incidents or injuries with respect to it or any member of its applicable Group vis-Γ -vis a Third-Party covered
under an applicable insurance or reinsurance policy.
Β
(g)Β Β Β Β Β Β Β Β Β Β This Agreement shall not be considered as an attempted assignment of any policy of insurance or as a contract of insurance and shall not be construed to waive any right or
remedy of any member of the UTC Group in respect of any insurance or reinsurance policy or any other contract or policy of insurance.
Β
(h)Β Β Β Β Β Β Β Β Β Β Each of Carrier and Otis does hereby, for itself and each other member of its Group, agree that no member of the UTC Group shall have any Liability whatsoever as a result of
the insurance or reinsurance policies and practices of UTC and the members of the UTC Group as in effect at any time, including as a result of the level or scope of any such insurance, the creditworthiness of any insurance carrier, the terms and
conditions of any policy or the adequacy or timeliness of any notice to any insurance carrier with respect to any claim or potential claim or otherwise.
Β
5.2Β Β Β Β Β Β Β Β Β Β Late Payments.Β Except as expressly provided to the contrary in this Agreement or in any Ancillary Agreement, any amount not paid when due
pursuant to this Agreement or any Ancillary Agreement (and any amounts billed or otherwise invoiced or demanded and properly payable that are not paid within forty-five (45) days of such xxxx, invoice or other demand) shall accrue interest at a
rate per annum equal to the Prime Rate plus twoΒ percent (2%).
Β
5.3Β Β Β Β Β Β Β Β Β Β Inducement.Β Each of Carrier and Otis acknowledges and agrees that UTCβs willingness to cause, effect and consummate the Separation and
Distributions has been conditioned upon and induced by the covenants and agreements of Carrier and Otis in this Agreement and the Ancillary Agreements, including Carrierβs assumption of the Carrier Liabilities and Otisβs assumption of the Otis
Liabilities pursuant to the Separation and the provisions of this Agreement and the covenants and agreements of Carrier and Otis contained in Article IV.
Β
5.4Β Β Β Β Β Β Β Β Β Β Post-Effective Time Conduct.Β The Parties acknowledge that, after the applicable Effective Time, each Party shall be independent of the other
Parties, with
Β
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responsibility for its own actions and inactions and its own Liabilities relating to, arising out of or resulting from the conduct of its business, operations and activities following the applicable Effective Time, except
as may otherwise be provided in any Ancillary Agreement, and each Party shall (except as otherwise provided in Article IV) use commercially reasonable efforts to prevent such Liabilities from being inappropriately borne by the other
Parties.
Β
5.5Β Β Β Β Β Β Β Β Β Β Director and Officer Insurance.Β For six (6) years after the applicable Effective Time, UTC shall provide officersβ and directorsβ liability
insurance in respect of acts or omissions occurring at or prior to the applicable Effective Time covering (a) each of the present and former officers and directors of UTC, Carrier and Otis and each of their Subsidiaries currently covered by UTCβs
officersβ and directorsβ liability insurance policies and (b) each of the present and former management committee members of any joint venture of UTC, Carrier or Otis or any of their Subsidiaries currently covered by UTCβs officersβ and directorsβ
liability insurance policies, on terms with respect to coverage and amount no less favorable than those of such policies as are in effect as of the applicable Effective Time with respect to UTCβs and/or its Subsidiaries (as applicable) then-current
officers, directors and management committee members, with fifty percent (50%) of the cost of such insurance deemed a UTC Liability, twenty-five percent (25%) of the cost of such insurance deemed a Carrier Liability and twenty-five percent (25%) of
the cost of such insurance deemed an Otis Liability.
Β
ARTICLE VI
EXCHANGE OF INFORMATION; CONFIDENTIALITY
EXCHANGE OF INFORMATION; CONFIDENTIALITY
Β
6.1Β Β Β Β Β Β Β Β Β Β Agreement for Exchange of Information.
Β
(a)Β Β Β Β Β Β Β Β Β Β Subject to Section 6.9 and any other applicable confidentiality obligations, each of UTC,
Carrier and Otis, on behalf of itself and each member of its Group, agrees to use commercially reasonable efforts to provide or make available, or cause to be provided or made available, to another Party and the members of such other Partyβs
Group, at any time before, on or after the Effective Time, as soon as reasonably practicable after written request therefor, any Information (or a copy thereof) in the possession or under the control of such Party or any member of its Group that
the requesting Party or any member of its Group requests, in each case to the extent that (i)Β such Information relates to the Carrier Business, or any Carrier Asset or Carrier Liability, if Carrier is the requesting Party, to the Xxxx Business,
or any Otis Asset or Otis Liability, if Otis is the requesting Party, or to the UTC Business, or any UTC Asset or UTC Liability, if UTC is the requesting Party; (ii)Β such Information is required by the requesting Party to comply with its
obligations under this Agreement or any Ancillary Agreement; or (iii)Β such Information is required by the requesting Party to comply with any obligation imposed by any Governmental Authority, including the obligation to verify the accuracy of
internal controls over information technology reporting of financial data and related processes employed in connection with verifying compliance with Section 404 of the Xxxxxxxx-Xxxxx Act of 2002 (it being understood that in the case of such
verification, the obligations set forth in this sentence shall apply to access to the facilities, systems, infrastructure and personnel of the applicable Party or its Group); provided, however, that in the event that the Party to whom the request has been made determines that any such provision of Information could be
detrimental to the Party providing the Information, violate any Law or agreement, or waive any privilege available under applicable Law, including any attorney-client privilege, then the Parties shall use commercially
Β
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reasonable efforts to permit compliance with such obligations to the extent and in a manner that avoids any such harm or consequence.Β The Party providing Information pursuant to this Section 6.1 shall only be
obligated to provide such Information in the form, condition and format in which it then exists, and in no event shall such Party be required to perform any improvement, modification, conversion, updating or reformatting of any such Information,
and nothing in this Section 6.1 shall expand the obligations of any Party under Section 6.4.Β Each Party shall cause its employees and the employees of any members of its Group to, and shall use commercially reasonable efforts to
cause the employees of its Representatives to, when on the property of another Party or a member of another Partyβs Group, conform to the policies and procedures of such Party or any member of such Partyβs Group concerning health, safety, conduct
and security that are made known or provided to the accessing Party from time to time.
Β
(b)Β Β Β Β Β Β Β Β Β Β Without limiting the generality of the foregoing, until the end of the fiscal year of UTC, Carrier or Otis during which the applicable Distribution Date occurs (whichever ends
latest), and for a reasonable period of time afterwards as required for each Party to prepare consolidated financial statements or complete a financial statement audit for the fiscal year during which the applicable Distribution Date occurs, each
Party shall use its commercially reasonable efforts to cooperate and comply with any other Partyβs Information requests to enable (i)Β such other Party to meet its timetable for dissemination of its earnings releases, financial statements and
managementβs assessment of the effectiveness of its disclosure controls and procedures and its internal control over financial reporting in accordance with Items 307 and 308, respectively, of Regulation S-K promulgated under the Exchange Act and
(ii)Β such other Partyβs accountants to timely complete their review of the quarterly financial statements and audit of the annual financial statements, including, to the extent applicable to such Party, its auditorβs audit of its internal control
over financial reporting and managementβs assessment thereof in accordance with SectionΒ 404 of the Xxxxxxxx-Xxxxx Act of 2002, the SECβs and Public Company Accounting Oversight Boardβs rulesΒ and auditing standards thereunder and any other
applicable Laws; provided, that, with respect to the first fiscal quarter in respect of which the activities described in the foregoing clauses (i) and (ii) are
undertaken following the Effective Time, each Party shall effect the foregoing by using the same processes, resources and deliverables for purposes of preparing financial statements and recording transactions as were used in the immediately prior
fiscal quarter.
Β
6.2Β Β Β Β Β Β Β Β Β Β Ownership of Information.Β The provision of any Information pursuant to Section 6.1 or Section 6.7 shall not affect the ownership
of such Information (which shall be determined solely in accordance with the terms of this Agreement and the Ancillary Agreements) or constitute a grant of rights in or to any such Information.
Β
6.3Β Β Β Β Β Β Β Β Β Β Compensation for Providing Information.Β The Party requesting Information agrees to reimburse the providing Party for the reasonable costs, if
any, of creating, gathering, copying, transporting and otherwise complying with the request with respect to such Information (including any reasonable costs and expenses incurred in any review of Information for purposes of protecting the
Privileged Information of the providing Party or in connection with the restoration of backup media for purposes of providing the requested Information).Β Except as may be otherwise specifically provided elsewhere in this Agreement, any Ancillary
Agreement or any other agreement between the Parties, such costs shall be computed in accordance with the providing Partyβs standard methodology and procedures.
Β
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6.4Β Β Β Β Β Β Β Β Β Β Record Retention.Β To facilitate the possible exchange of Information pursuant to this Article VI and other provisions of this Agreement
after the Effective Time, from and after the Effective Time until the twelfth (12th) anniversary of the Effective Time, the Parties agree to use their commercially reasonable efforts, which shall be no less rigorous than those used for retention of
such Partyβs own Information, to retain all Information in their respective possession or control, or the possession or control of any member of their respective Group, at the Effective Time in accordance with the policies used for retention of
such Partyβs own Information of a similar type.Β Notwithstanding the foregoing, Section 9.01 of the Tax Matters Agreement will govern the retention of Tax-related records, and Section
9.01 of the Employee Matters Agreement will govern the retention of employment- and benefits-related records.
Β
6.5Β Β Β Β Β Β Β Β Β Β Limitations of Liability.Β None of the Parties shall have any Liability to any other Party in the event that any Information exchanged or
provided pursuant to this Agreement is found to be inaccurate in the absence of gross negligence, bad faith or willful misconduct by the Party providing such Information.Β None of the Parties shall have any Liability to any other Party if any
Information is destroyed after commercially reasonable efforts by such Party to comply with the provisions of Section 6.4.
Β
6.6Β Β Β Β Β Β Β Β Β Β Other Agreements Providing for Exchange of Information.
Β
(a)Β Β Β Β Β Β Β Β Β Β The rights and obligations granted under this Article VI are subject to any specific
limitations, qualifications or additional provisions on the sharing, exchange, retention or confidential treatment of Information set forth in any Ancillary Agreement.
Β
(b)Β Β Β Β Β Β Β Β Β Β Any Party that receives, pursuant to a request for Information in accordance with this Article VI, Tangible Information that is not relevant to its request shall, at the request of the providing Party, (i) return it to the providing Party or, at the providing Partyβs request, destroy such Tangible Information; and (ii) deliver to
the providing Party written confirmation that such Tangible Information was returned or destroyed, as the case may be, which confirmation shall be signed by an authorized representative of the requesting Party.
Β
6.7Β Β Β Β Β Β Β Β Β Β Production of Witnesses; Records; Cooperation.
Β
(a)Β Β Β Β Β Β Β Β Β Β After the Effective Time, except in the case of a Dispute between the applicable Parties, or any member of their respective Groups, each Party shall use its commercially
reasonable efforts to make available to any other Party, upon written request, the former, current and future directors, officers, employees, other personnel and agents of the members of its respective Group as witnesses and any books, records or
other documents within its control, to the extent that any such Person (giving consideration to business demands of such directors, officers, employees, other personnel and agents) or books, records or other documents may reasonably be required
in connection with any Action in which the requesting Party (or any member of its Group) may from time to time be involved, regardless of whether such Action is a matter with respect to which indemnification may be sought hereunder.Β The
requesting Party shall bear all costs and expenses in connection therewith.
Β
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(b)Β Β Β Β Β Β Β Β Β Β If an Indemnifying Party chooses to defend or to seek to compromise or settle any Third-Party Claim, the applicable other Party (or Parties) shall make available to such
Indemnifying Party, upon written request, the former, current and future directors, officers, employees, other personnel and agents of the members of its respective Group as witnesses and any books, records or other documents within its control,
to the extent that any such Person (giving consideration to business demands of such directors, officers, employees, other personnel and agents) or books, records or other documents may reasonably be required in connection with such defense,
settlement or compromise, or such prosecution, evaluation or pursuit, as the case may be, and shall otherwise cooperate in such defense, settlement or compromise, or such prosecution, evaluation or pursuit, as the case may be.
Β
(c)Β Β Β Β Β Β Β Β Β Β Without limiting the foregoing, the Parties shall cooperate and consult to the extent reasonably necessary with respect to any Actions.
Β
(d)Β Β Β Β Β Β Β Β Β Β The obligation of the Parties to provide witnesses pursuant to this SectionΒ 6.7 is intended
to be interpreted in a manner so as to facilitate cooperation and shall include the obligation to provide as witnesses directors, officers, employees, other personnel and agents without regard to whether such Person or the employer of such Person
could assert a possible business conflict (subject to the exception set forth in the first sentence of Section 6.7(a)).
Β
6.8Β Β Β Β Β Β Β Β Β Β Privileged Matters.
Β
(a)Β Β Β Β Β Β Β Β Β Β The Parties recognize that legal and other professional services that have been and will be provided prior to the First Effective Time have been and will be rendered for the
collective benefit of each of the members of the UTC Group, the Carrier Group and the Otis Group and that each of the members of the UTC Group, the Carrier Group and the Otis Group should be deemed to be the client with respect to such services
for the purposes of asserting all privileges that may be asserted under applicable Law in connection therewith.Β The Parties recognize that legal and other professional services may be provided following the First Effective Time and prior to the
Second Effective Time, which services will be rendered (i) in the event the Carrier Effective Time is the First Effective Time, solely for the benefit of the Carrier Group on the one hand, and each of the members of the UTC Group and the Otis
Group, on the other hand, as the case may be, or (ii) in the event the Otis Effective Time is the First Effective Time, solely for the benefit of the Otis Group on the one hand, and each of the members of the UTC Group and the Carrier Group, on
the other hand.Β The Parties recognize that legal and other professional services will be provided following the Second Effective Time, which services will be rendered solely for the benefit of the UTC Group, the Carrier Group or the Otis Group,
as the case may be.Β In furtherance of the foregoing, each Party shall authorize the delivery to and/or retention by the other Parties of materials existing as of the applicable Effective Time that are necessary for such services to be rendered
for the benefit of the other applicable Parties.
Β
(b)Β Β Β Β Β Β Β Β Β Β The Parties agree as follows:
Β
(i)Β Β Β Β Β Β Β Β Β Β UTC shall be entitled, in perpetuity, to control the assertion or waiver of all privileges and immunities in connection with any Privileged Information that
relates solely to the UTC Business and not to the Carrier Business or the Otis
Β
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Business, whether or not the Privileged Information is in the possession or under the control of any member of the UTC Group or any member of the Carrier Group or the Otis Group.Β UTC shall also be
entitled, in perpetuity, to control the assertion or waiver of all privileges and immunities in connection with any Privileged Information that relates solely to any UTC Assets or UTC Liabilities resulting from or arising out of any Actions that
are now pending or may be asserted in the future, whether or not the Privileged Information is in the possession or under the control of any member of the UTC Group or any member of the Carrier Group or the Otis Group;
Β
(ii)Β Β Β Β Β Β Β Β Carrier shall be entitled, in perpetuity, to control the assertion or waiver of all privileges and immunities in connection with any Privileged Information
that relates solely to the Carrier Business and not to the UTC Business or the Xxxx Business, whether or not the Privileged Information is in the possession or under the control of any member of the Carrier Group or any member of the UTC Group or
the Otis Group.Β Carrier shall also be entitled, in perpetuity, to control the assertion or waiver of all privileges and immunities in connection with any Privileged Information that relates solely to any Carrier Assets or Carrier Liabilities
resulting from or arising out of any Actions that are now pending or may be asserted in the future, whether or not the Privileged Information is in the possession or under the control of any member of the Carrier Group or any member of the UTC
Group or the Otis Group; and
Β
(iii)Β Β Β Β Β Β Β Otis shall be entitled, in perpetuity, to control the assertion or waiver of all privileges and immunities in connection with any Privileged Information
that relates solely to the Xxxx Business and not to the UTC Business or the Carrier Business, whether or not the Privileged Information is in the possession or under the control of any member of the Otis Group or any member of the UTC Group or
the Carrier Group.Β Otis shall also be entitled, in perpetuity, to control the assertion or waiver of all privileges and immunities in connection with any Privileged Information that relates solely to any Otis Assets or Otis Liabilities resulting
from or arising out of any Actions that are now pending or may be asserted in the future, whether or not the Privileged Information is in the possession or under the control of any member of the Otis Group or any member of the UTC Group or the
Carrier Group.
Β
(iv)Β Β Β Β Β Β Β If the Parties do not agree as to whether certain Information is Privileged Information, then such Information shall be treated as Privileged Information,
and the Party that believes that such Information is Privileged Information shall be entitled to control the assertion or waiver of all privileges and immunities in connection with any such Information unless the Parties otherwise agree.Β The
Parties shall use the procedures set forth in Article VII to resolve any disputes as to whether any Information relates solely to the UTC Business, solely to the
Carrier Business, solely to the Xxxx Business or to more than one of the UTC Business, the Carrier Business and the Xxxx Business.
Β
(c)Β Β Β Β Β Β Β Β Β Β Subject to the remaining provisions of this SectionΒ 6.8, the Parties agree that they shall
have a shared privilege or immunity with respect to all privileges and immunities not allocated pursuant to SectionΒ 6.8(b), including all privileges and immunities
relating to any Actions or other matters that involve more than one of the Parties (or one or more members of
Β
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their respective Groups) or in respect of which more than one of the Parties has Liabilities under this Agreement; it being understood that such shared privilege or immunity shall not be shared by UTC, Carrier or Otis if
the applicable Privileged Information does not relate to the UTC Business, Carrier Business or Otis Business, or any UTC Liabilities, Carrier Liabilities or Otis Liabilities, respectively.Β No such shared privilege or immunity may be waived by any
of the Parties without the consent of the applicable other Parties who share such privilege or immunity.
Β
(d)Β Β Β Β Β Β Β Β Β Β If any Dispute arises among any of the Parties or any members of their respective Groups regarding whether a privilege or immunity should be waived to protect or advance the
interests of any of the Parties and/or any members of their respective Groups, each Party agrees that it shall (i)Β negotiate with the applicable other Parties in good faith; (ii)Β endeavor to minimize any prejudice to the rights of the applicable
other Parties; and (iii)Β not unreasonably withhold, condition or delay consent to any request for waiver by the applicable other Parties.Β Further, each Party specifically agrees that it shall not withhold its consent to the waiver of a privilege
or immunity for any purpose except in good faith to protect its own legitimate interests.
Β
(e)Β Β Β Β Β Β Β Β Β Β In the event of any Dispute among two (2) or all of the Parties, or any members of their respective Groups, any of the applicable Parties may waive a privilege in which the
applicable other Party or Parties or any member of such applicable other Partyβs Group or Partiesβ respective Groups has a shared privilege, without obtaining consent pursuant to SectionΒ 6.8(c); provided, that such Party intends such waiver of a shared privilege to be effective only as to the use of Information with respect to the
Action among such Parties and/or the applicable members of their respective Groups, and is not intended to operate as a waiver of the shared privilege with respect to any Third Party.
Β
(f)Β Β Β Β Β Β Β Β Β Β Upon receipt by any of the Parties, or by any member of their respective Groups, of any subpoena, discovery or other request that may reasonably be expected to result in the
production or disclosure of Privileged Information subject to a shared privilege or immunity or as to which another Party has the sole right hereunder to assert a privilege or immunity, or if any of the Parties obtains knowledge that any of its,
or any member of its respective Groupβs, current or former directors, officers, agents or employees have received any subpoena, discovery or other request that may reasonably be expected to result in the production or disclosure of such
Privileged Information, such Party shall promptly notify the applicable other Party(ies) of the existence of the request (which notice shall be delivered to such applicable other Party(ies) no later than five (5)Β business days following the
receipt of any such subpoena, discovery or other request) and shall provide the applicable other Party(ies) a reasonable opportunity to review the Privileged Information and to assert any rights it or they may have under this SectionΒ 6.8 or otherwise, to prevent the production or disclosure of such Privileged Information.
Β
(g)Β Β Β Β Β Β Β Β Β Β Any furnishing of, or access or transfer of, any Information pursuant to this Agreement is made in reliance on the agreement among UTC, Carrier and Otis set forth in this SectionΒ 6.8 and in SectionΒ 6.9 to maintain the confidentiality of Privileged Information and to
assert and maintain all applicable privileges and immunities.Β The Parties agree that their respective rights to any access to Information, witnesses and other Persons, the furnishing of notices and documents and other cooperative efforts among
the Parties contemplated by this Agreement, and the transfer of Privileged Information among the Parties and members of their
Β
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respective Groups as needed pursuant to this Agreement, shall not be deemed a waiver of any privilege that has been or may be asserted under this Agreement or otherwise.
Β
(h)Β Β Β Β Β Β Β Β Β Β In connection with any matter contemplated by Section 6.7 or this Section 6.8, the Parties agree to, and to cause the applicable members of their respective Groups to, use commercially reasonable efforts to maintain their respective separate and joint
privileges and immunities, including by executing joint defense and/or common interest agreements where necessary or useful for this purpose.
Β
6.9Β Β Β Β Β Β Β Β Β Β Confidentiality.
Β
(a)Β Β Β Β Β Β Β Β Β Β Confidentiality.Β Subject to Section 6.10, from and after the Effective Time until the third (3rd) anniversary of the Effective Time, each of UTC, Carrier and Otis, on behalf of itself and each member of its respective Group, agrees to hold, and to cause its respective
Representatives to hold, in strict confidence, with at least the same degree of care that applies to UTCβs confidential and proprietary Information pursuant to policies in effect as of the Effective Time, all confidential and proprietary
Information concerning any other Party or any member of any other Partyβs Group or their respective businesses that is either in its possession (including confidential and proprietary Information in its possession prior to the date hereof) or
furnished by any such other Party or any member of such Partyβs Group or their respective Representatives at any time pursuant to this Agreement, any Ancillary Agreement or otherwise, and shall not use any such confidential and proprietary
Information other than for such purposes as shall be expressly permitted hereunder or thereunder, except, in each case, to the extent that such confidential and proprietary Information has been (i) in the public domain or generally available to
the public, other than as a result of a disclosure by any Party or any member of any Partyβs Group or any of their respective Representatives in violation of this Agreement, (ii) later lawfully acquired from other sources by such Party (or any
member of such Partyβs Group) which sources are not themselves known by such Party (or any member of such Partyβs Group) to be bound by a confidentiality obligation or other contractual, legal or fiduciary obligation of confidentiality with respect to such confidential and proprietary Information, or (iii) independently developed or generated by such Party (or any member of such Partyβs Group) without reference to or use of any proprietary or confidential
Information of any other Party or any member of any such other Partyβs Group; provided, with respect to trade secrets of any other Party or any member of any other
Partyβs Group or their respective businesses, the foregoing obligations and restrictions shall remain in effect for so long as the relevant information remains a trade secret under applicable Law.Β If any confidential and proprietary Information
of one Party or any member of its Group is disclosed to another Party or any member of another Partyβs Group in connection with providing services to such first Party or any member of such first Partyβs Group under this Agreement or any Ancillary
Agreement, then such disclosed confidential and proprietary Information shall be used only as required to perform such services.
Β
(b)Β Β Β Β Β Β Β Β Β Β No Release; Return or Destruction.Β Each Party agrees not to release or disclose, or permit to be released or
disclosed, any Information addressed in Section 6.9(a) to any other Person, except its Representatives who need to know such Information in their capacities as such
(who shall be advised of their obligations hereunder with respect to such Information) and except in compliance with Section 6.10.Β Without limiting the foregoing,
when any such Information is no longer needed for the purposes contemplated by this Agreement or any
Β
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Ancillary Agreement, and is no longer subject to any legal hold or other document preservation obligation, each Party will promptly after request of the applicable other Party either return to such other Party all such
Information in a tangible form (including all copies thereof and all notes, extracts or summaries based thereon) or notify such other Party in writing that it has destroyed such Information (and such copies thereof and such notes, extracts or
summaries based thereon); provided, that the Parties may retain electronic backup versions of such Information maintained on routine computer system backup tapes, disks or other backup storage devices; provided, further,
that any such Information so retained shall remain subject to the confidentiality provisions of this Agreement or any Ancillary Agreement.
Β
(c)Β Β Β Β Β Β Β Β Β Β Third-Party Information; Privacy or Data Protection Laws.Β Each Party acknowledges that it and members of its Group
may presently have and, following the Effective Time, may gain access to or possession of confidential or proprietary Information of, or legally protected personal Information relating to, Third Parties (i) that was received under privacy
policies and/or confidentiality or nondisclosure agreements entered into between such Third Parties, on the one hand, and another Party or members of another Partyβs Group, on the other hand, prior to the Effective Time; or (ii) that, as between
the three (3) Parties, was originally collected by another Party or members of such other Partyβs Group and that may be subject to and protected by privacy policies, as well as privacy, data protection or other applicable Laws. Each Party agrees
that it shall hold, protect and use, and shall cause the members of its Group and its and their respective Representatives to hold, protect and use, in strict confidence the confidential and proprietary Information of, or legally protected
personal Information relating to, Third Parties in accordance with privacy policies and privacy, data protection or other applicable Laws and the terms of any agreements that were either entered into before the Effective Time or affirmative
commitments or representations that were made before the Effective Time by, between or among another Party or members of another Partyβs Group, on the one hand, and such Third Parties, on the other hand.
Β
6.10Β Β Β Β Β Β Β Protective Arrangements.Β In the event that a Party or any member of its Group either determines on the advice of its counsel that it is required
to disclose any Information pursuant to applicable Law or receives any request or demand under lawful process or from any Governmental Authority to disclose or provide Information of another Party (or any member of another Partyβs Group) that is
subject to the confidentiality provisions hereof, such Party shall notify the applicable other Party (to the extent legally permitted) as promptly as practicable under the circumstances prior to disclosing or providing such Information and shall
cooperate, at the expense of the applicable other Party, in seeking any appropriate protective order requested by the applicable other Party.Β In the event that such other Party fails to receive such appropriate protective order in a timely manner
and the Party receiving the request or demand reasonably determines that its failure to disclose or provide such Information shall actually prejudice the Party receiving the request or demand, then the Party that received such request or demand may
thereafter disclose or provide Information to the extent required by such Law (as so advised by its counsel) or by lawful process or such Governmental Authority or to the extent necessary for such Party to not be so prejudiced, and the disclosing
Party shall promptly provide the applicable other Party with a copy of the Information so disclosed, in the same form and format so disclosed, together with a list of all Persons to whom such Information was disclosed, in each case to the extent
legally permitted.
Β
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ARTICLE VII
DISPUTE RESOLUTION
DISPUTE RESOLUTION
Β
7.1Β Β Β Β Β Β Β Β Β Β Good Faith Officer Negotiation.Β Subject to Section 7.4, any of the Parties seeking resolution of any dispute, controversy or claim
arising out of or relating to this Agreement or any Ancillary Agreement (including regarding whether any Assets are Carrier Assets, Otis Assets or UTC Assets, any Liabilities are Carrier Liabilities, Otis Liabilities or UTC Liabilities, or the
validity, interpretation, breach or termination of this Agreement or any Ancillary Agreement) (a βDisputeβ), which Dispute could not be resolved by the Transition Committee, shall provide written notice thereof to the applicable other
Parties (the βOfficer Negotiation Requestβ).Β Within fifteen (15) days of the delivery of the Officer Negotiation Request, the applicable Parties shall attempt to resolve the Dispute through good faith negotiation.Β All such negotiations
shall be conducted by executives of the applicable Parties who hold, at a minimum, the title of Senior Vice President (or a position substantially equivalent thereto) and who have authority to settle the Dispute.Β All such negotiations shall be
confidential and shall be treated as compromise and settlement negotiations for purposes of applicable rules of evidence.Β If the applicable Parties are unable for any reason to resolve a Dispute within thirty (30) days of receipt of the Officer
Negotiation Request, and such thirty (30)-day period is not extended by mutual written consent of the applicable Parties, or if an applicable Party reasonably concludes that another applicable Party is not willing to negotiate in good faith as
contemplated by this Section 7.1, any of the applicable Parties may submit the Dispute to mediation in accordance with Section 7.2.
Β
7.2Β Β Β Β Β Β Β Β Β Β Mediation.Β Any Dispute not resolved pursuant to Section 7.1 shall, at the written request of any applicable Party (a βMediation
Requestβ), be submitted to nonbinding mediation in accordance with the International Institute for Conflict Prevention and Resolution (βCPRβ) Mediation Procedure then in effect, except as modified herein.Β The mediation shall be held
in New York, New York or such other place as the applicable Parties may mutually agree.Β The applicable Parties shall have twenty (20) days from receipt by a Party of a Mediation Request to agree on a mediator.Β If no mediator has been agreed upon
by the applicable Parties within twenty (20) days of receipt by a Party of a Mediation Request, then any applicable Party may request (on written notice to the other applicable Parties) that CPR appoint a mediator in accordance with the CPR
Mediation Procedure.Β All mediation pursuant to this Section 7.2 shall be confidential and shall be treated as compromise and settlement negotiations for purposes of applicable rules of evidence, and no oral or documentary representations
made by the applicable Parties during such mediation shall be admissible for any purpose in any subsequent proceedings.Β No Party shall disclose or permit the disclosure of any Information about the evidence adduced or the documents produced by
another Party in the mediation proceedings or about the existence, contents or results of the mediation without the prior written consent of such other applicable Party, except in the course of a judicial or regulatory proceeding or as may be
required by Law or securities exchange rules or requested by a Governmental Authority or securities exchange.Β Before making any disclosure permitted by the preceding sentence, the Party intending to make such disclosure shall, to the extent
reasonably practicable, give the other applicable Party reasonable written notice of the intended disclosure and afford such other Party a reasonable opportunity to protect its interests.Β If the Dispute has not been resolved within the earlier of
sixty (60) days after the appointment of a mediator or ninety (90) days after receipt by a Party of a Mediation Request, or within such longer period as the applicable Parties may agree
Β
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to in writing, any of the applicable Parties may submit the Dispute to binding arbitration in accordance with Section 7.3; provided, that if one applicable Party fails to participate in the mediation for
thirty (30) days after the appointment of a mediator, the other applicable Parties may commence arbitration in accordance with Section 7.3 prior to the expiration of the time periods set forth above.
Β
7.3Β Β Β Β Β Β Β Β Β Β Arbitration.
Β
(a)Β Β Β Β Β Β Β Β Β Β In the event that a Dispute has not been resolved within the earlier of sixty (60) days after the appointment of a mediator or ninety (90) days after receipt by a Party of a
Mediation Request in accordance with SectionΒ 7.2, or
within such longer period as the applicable Parties may agree to in writing, then such Dispute shall, upon the written request of an applicable Party (the βArbitration Requestβ) be submitted to be finally resolved by binding arbitration in accordance with the then-current CPR arbitration procedure, except as modified herein.Β The arbitration shall be held in (i) New York City, New York or (ii) such other
place as the applicable Parties may mutually agree in writing.Β Unless otherwise agreed by the applicable Parties in writing, any Dispute to be decided pursuant to this Section 7.3 will be decided before a sole independent arbitrator, and, subject only to SectionsΒ 7.1,Β 7.2 and 7.4, arbitration pursuant to this Section 7.3 shall be the sole and exclusive venue for resolution of any and all Disputes.
Β
(b)Β Β Β Β Β Β Β Β Β Β The sole independent arbitrator will be appointed by agreement of the applicable Parties within fifteen (15) days of the date of receipt of the Arbitration Request.Β If the
applicable Parties cannot agree to a sole independent arbitrator during such fifteen (15)-day period, then upon written application by any applicable Party, the sole independent arbitrator will be appointed pursuant to the CPR arbitration
procedure.
Β
(c)Β Β Β Β Β Β Β Β Β Β The arbitrator will have the right to award, on a preliminary or interim basis, or include in the final award, any relief that it deems proper in the circumstances, including
money damages (with interest on unpaid amounts from the due date), injunctive relief (including specific performance) and attorneysβ fees and costs; provided, that
the arbitrator will not award any relief not specifically requested by the applicable Parties and, in any event, will not award any indirect, punitive, exemplary, remote, speculative or similar damages in excess of compensatory damages of the
other applicable Parties arising in connection with the transactions contemplated hereby (other than any such Liability arising from a payment actually made to a Third Party with respect to a Third-Party Claim).Β Upon selection of the arbitrator
following any grant of interim relief by a special arbitrator or court pursuant to Section 7.4, the arbitrator may affirm or disaffirm that relief, and the
applicable Parties will seek modification or rescission of the order entered by the court as necessary to accord with the decision of the arbitrator.Β The award of the arbitrator shall be final and binding on the applicable Parties and may be
enforced in any court of competent jurisdiction.Β The initiation of arbitration pursuant to this Article VII will toll the applicable statute of limitations for the
duration of any such proceedings.Β Notwithstanding applicable state Law, the arbitration and this agreement to arbitrate shall be governed by the Federal Arbitration Act, 9 U.S.C. Β§ 1, et
seq.
Β
7.4Β Β Β Β Β Β Β Β Β Β Litigation and Unilateral Commencement of Arbitration.Β Notwithstanding the foregoing provisions of this Article VII, (a) a Party may seek
preliminary provisional or injunctive judicial relief with respect to a Dispute without first complying with the procedures set
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forth in Section 7.1, SectionΒ 7.2 and Section 7.3 if such action is reasonably necessary to avoid irreparable damage (it being understood that such initiating Party
may, at its election, pursue arbitration, including seeking arbitral relief on a preliminary or interim basis, in lieu of such judicial relief) and (b) any of the applicable Parties may initiate arbitration before the expiration of the periods
specified in Section 7.1, Section 7.2 and/or Section 7.3 if such Party has submitted an Officer Negotiation Request, a Mediation Request and/or an Arbitration Request and any of the other applicable Parties has failed to
comply with Section 7.1, Section 7.2 and/or Section 7.3 in good faith with respect to such negotiation and/or the commencement and engagement in arbitration.Β In the circumstances contemplated by clause (b) of the
immediately preceding sentence, such applicable Party may commence and prosecute such arbitration unilaterally in accordance with the CPR arbitration procedure.
7.5Β Β Β Β Β Β Β Β Β Β Conduct During Dispute Resolution Process.Β Unless otherwise agreed in writing, the Parties shall, and shall cause the members of their respective Groups
to, continue to honor all commitments under this Agreement and each Ancillary Agreement to the extent required by such agreements during the course of dispute resolution pursuant to the provisions of this Article VII, unless such
commitments are the specific subject of the Dispute at issue.
7.6Β Β Β Β Β Β Β Β Β Β Dispute Resolution Coordination.Β Except to the extent otherwise provided in Section 14 of the Tax Matters Agreement or Section 8.2 of the Intellectual
Property Agreement (as applicable), the provisions of this Article VII (other than this Section 7.6) shall not apply with respect to the resolution of any dispute, controversy or claim arising out of or relating to (a) Taxes or Tax
matters (it being understood and agreed that the resolution of any dispute, controversy or claim arising out of or relating to Taxes or Tax matters shall be governed by the Tax Matters Agreement) or (b) the Intellectual Property Agreement (it being
understood and agreed that the resolution of any such dispute, controversy or claim arising out of or relating to the Intellectual Property Agreement shall be governed by the Intellectual Property Agreement).
ARTICLE VIII
FURTHER ASSURANCES AND ADDITIONAL COVENANTS
FURTHER ASSURANCES AND ADDITIONAL COVENANTS
Β
8.1Β Β Β Β Β Β Β Β Β Β Further Assurances.
Β
(a)Β Β Β Β Β Β Β Β Β Β In addition to the actions specifically provided for elsewhere in this Agreement, each of the Parties shall use its reasonable best efforts, prior to, on and after the
Effective Time to take, or cause to be taken, all actions, and to do, or cause to be done, all things, reasonably necessary, proper or advisable under applicable Laws, regulations and agreements to consummate and make effective the transactions
contemplated by this Agreement and the Ancillary Agreements.
Β
(b)Β Β Β Β Β Β Β Β Β Β Without limiting the foregoing, prior to, on and after the Effective Time, each Party hereto shall cooperate with the other Parties, and without any further consideration, but
at the expense of the requesting Party, to execute and deliver, or use its reasonable best efforts to cause to be executed and delivered, all instruments, including instruments of conveyance, assignment and transfer, and to make all filings with,
and to obtain all Approvals or Notifications of, any Governmental Authority or any other Person under any Permit, license,
Β
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agreement, indenture or other instrument (including any consents or any Approval or Notification to be made to or obtained from, any Governmental Authority), and to take all such other actions as such Party may reasonably
be requested to take by the other Parties from time to time, consistent with the terms of this Agreement and the Ancillary Agreements, in order to effectuate the provisions and purposes of this Agreement and the Ancillary Agreements and the
transfers of the Carrier Assets, the Otis Assets and the UTC Assets and the assignment and assumption of the Carrier Liabilities, the Otis Liabilities and the UTC Liabilities and the other transactions contemplated hereby and thereby.Β Without
limiting the foregoing but consistent with the terms of this Agreement (including Section 2.4) and the Ancillary Agreements, each Party will, at the reasonable request, cost and expense of the applicable other Party, take such other actions
as may be reasonably necessary to vest in such other Party good and marketable title to the Assets allocated to such Party under this Agreement or any of the Ancillary Agreements, free and clear of any Security Interest, if and to the extent it is
practicable to do so.
Β
(c)Β Β Β Β Β Β Β Β Β Β On or prior to the Effective Time, UTC, Carrier and Otis in their respective capacities as direct and indirect stockholders of the members of their Groups, shall each ratify
any actions that are reasonably necessary or desirable to be taken by UTC, Xxxxxxx, Xxxx or any members of their respective Group, as the case may be, to effectuate the transactions contemplated by this Agreement and the Ancillary Agreements.
Β
(d)Β Β Β Β Β Β Β Β Β Β UTC, Carrier and Otis, and each of the members of their respective Groups, waive (and agree not to assert against any of the others) any claim or demand that any of them may
have against any member of any of the other Groups for any Liabilities or other claims relating to or arising out of:Β (i) the failure of a Party to provide any notification or disclosure required under any state Environmental Law in connection
with the Separation or the other transactions contemplated by this Agreement, including the transfer by any member of any Group to any member of the other Group of ownership or operational control of any Assets not previously owned or operated by
such transferee; or (ii) any inadequate, incorrect or incomplete notification or disclosure under any such state Environmental Law by the applicable transferor.Β To the extent any Liability to any Governmental Authority or any Third Party arises
out of any action or inaction described in the foregoing clause (i) or (ii), the transferee of the applicable Asset hereby assumes and agrees to pay any such Liability.
Β
ARTICLE IX
TERMINATION
TERMINATION
Β
9.1Β Β Β Β Β Β Β Β Β Β Termination.Β This Agreement and all Ancillary Agreements may be terminated and either or both of the Distributions may be amended, modified or
abandoned at any time prior to the First Effective Time by UTC, in its sole and absolute discretion, without the approval or consent of Carrier or Otis.Β After the First Effective Time, this Agreement may not be terminated except by an agreement in
writing signed by a duly authorized officer of each of the Parties, it being understood that, subject to Section 10.14, the Second Distribution may be
Β
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amended, modified or abandoned at any time prior to the Second Effective Time by UTC, in its sole and absolute discretion, without the approval or consent of Carrier or Otis.
Β
9.2Β Β Β Β Β Β Β Β Β Β Effect of Termination.Β In the event of any termination of this Agreement prior to the First Effective Time, no Party (nor any of its directors,
officers or employees) shall have any Liability or further obligation to any other Party by reason of this Agreement.
Β
ARTICLE X
MISCELLANEOUS
MISCELLANEOUS
Β
10.1Β Β Β Β Β Β Β Β Β Β Counterparts; Entire Agreement; Corporate Power.
Β
(a)Β Β Β Β Β Β Β Β Β Β This Agreement and each Ancillary Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement, and shall become
effective when one or more counterparts have been signed by each of the Parties and delivered to the other Parties.
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(b)Β Β Β Β Β Β Β Β Β Β This Agreement, the Ancillary Agreements and the Exhibits, Schedules and appendices hereto and thereto contain the entire agreement among the Parties with respect to the
subject matter hereof, supersede all previous agreements, negotiations, discussions, writings, understandings, commitments and conversations with respect to such subject matter, and there are no agreements or understandings among the Parties
other than those set forth or referred to herein or therein.Β This Agreement and the Ancillary Agreements together govern the arrangements in connection with the Separation and the Distributions and would not have been entered independently.
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(c)Β Β Β Β Β Β Β Β Β Β UTC represents on behalf of itself and each other member of the UTC Group, Carrier represents on behalf of itself and each other member of the Carrier Group and Otis
represents on behalf of itself and each other member of the Otis Group, as follows:
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(i)Β Β Β Β Β Β Β Β Β Β each such Person has the requisite corporate or other power and authority and has taken all corporate or other action necessary in order to execute, deliver
and perform this Agreement and each Ancillary Agreement to which it is a party and to consummate the transactions contemplated hereby and thereby; and
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(ii)Β Β Β Β Β Β Β Β Β Β this Agreement and each Ancillary Agreement to which it is a party has been duly executed and delivered by it and constitutes a valid and binding agreement
of it enforceable in accordance with the terms thereof.
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(d)Β Β Β Β Β Β Β Β Β Β Each Party acknowledges that it and each other Party is executing certain of the Ancillary Agreements by facsimile, stamp or mechanical signature and that delivery of an
executed counterpart of a signature pageΒ to this Agreement or any Ancillary Agreement (whether executed by manual, stamp or mechanical signature) by facsimile or by e-mail in portable document format (PDF) shall be effective as delivery of such
executed counterpart of this Agreement or any Ancillary Agreement.Β Each Party expressly adopts and confirms each such facsimile, stamp or mechanical signature (regardless of whether delivered in person, by mail, by courier, by facsimile or by
e-mail in portable document format (PDF)) made in its respective name as if it were a manual signature delivered in person, agrees that it will not assert that any
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such signature or delivery is not adequate to bind such Party to the same extent as if it were signed manually and delivered in person and agrees that, at the reasonable request of the other Party at any time, it will as
promptly as reasonably practicable cause each such Ancillary Agreement to be manually executed (any such execution to be as of the date of the initial date thereof) and delivered in person, by mail or by courier.
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10.2Β Β Β Β Β Β Β Governing Law.Β This Agreement and, unless expressly provided therein, each Ancillary Agreement (and any claims or disputes arising out of or
related hereto or thereto or to the transactions contemplated hereby and thereby or to the inducement of any party to enter herein and therein, whether for breach of contract, tortious conduct or otherwise and whether predicated on common law,
statute or otherwise) shall be governed by and construed and interpreted in accordance with the Laws of the State of Delaware irrespective of the choice of laws principles of the State of Delaware including all matters of validity, construction,
effect, enforceability, performance and remedies.
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10.3Β Β Β Β Β Β Β Assignability.Β Except as set forth in any Ancillary Agreement, this Agreement and each Ancillary Agreement shall be binding upon and inure to
the benefit of the Parties and the parties thereto, respectively, and their respective successors and permitted assigns; provided, that none of the Parties nor any such party thereto may assign its rights or delegate its obligations under
this Agreement or any Ancillary Agreement without the express prior written consent of the other Parties hereto or other parties thereto, as applicable.Β Notwithstanding the foregoing, no such consent shall be required for the assignment of a
Partyβs rights and obligations under this Agreement and the Ancillary Agreements (except as may be otherwise provided in any such Ancillary Agreement) in whole (i.e., the assignment of a Partyβs rights and obligations under this Agreement
and all Ancillary Agreements all at the same time) in connection with a change of control of a Party so long as the resulting, surviving or transferee Person assumes all the obligations of the relevant party thereto by operation of Law or pursuant
to an agreement in form and substance reasonably satisfactory to the other Parties.
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10.4Β Β Β Β Β Β Β Third-Party Beneficiaries.Β Except for the indemnification rights under this Agreement and each Ancillary Agreement of any UTC Indemnitee,
Carrier Indemnitee or Otis Indemnitee in their respective capacities as such, (a) the provisions of this Agreement and each Ancillary Agreement are solely for the benefit of the Parties and are not intended to confer upon any Person except the
Parties any rights or remedies hereunder, and (b) there are no third-party beneficiaries of this Agreement or any Ancillary Agreement and neither this Agreement nor any Ancillary Agreement shall provide any Third Party with any remedy, claim,
Liability, reimbursement, claim of Action or other right in excess of those existing without reference to this Agreement or any Ancillary Agreement.
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10.5Β Β Β Β Β Β Β Notices.Β All notices, requests, claims, demands or other communications under this Agreement and, to the extent applicable and unless otherwise
provided therein, under each of the Ancillary Agreements, shall be in writing and shall be given or made (and except as provided herein, shall be deemed to have been duly given or made upon receipt) by delivery in person, by overnight courier
service, by certified mail, return receipt requested, or by electronic mail (βe-mailβ), so long as confirmation of receipt of such e-mail is requested and received, to the respective Parties at the following addresses (or at such other
address for a Party as shall be specified in a notice given in accordance with this Section 10.5):
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If to UTC, to:
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United Technologies Corporation
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00 Xxxx Xxxxxxx Xxxx
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Xxxxxxxxxx, Xxxxxxxxxxx 00000
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Attention:
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Xxxx Xxxxxx, Corporate Vice President and Associate General Counsel |
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E-mail:
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Xxxx.Xxxxxx@xxx.xxx
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Β | Β | Β |
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with a copy to:
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Wachtell, Lipton, Xxxxx & Xxxx
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00 Xxxx 00xx Xxxxxx
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Xxx Xxxx, Xxx Xxxx 00000
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Attention:
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Xxxxxx X. Xxxxxxxx
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Β | Β |
Xxxxxx X. Xxx
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Xxxxx X. Xxxxxx
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Β | Β |
Xxxx X. Xxxxxxxxx
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E-mail:
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XXXxxxxxxx@xxxx.xxx
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XXXxx@xxxx.xxx
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XXXxxxxx@xxxx.xxx
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XXXxxxxxxxx@xxxx.xxx
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If to Carrier, to:
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Carrier Global Corporation
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00000 Xxxxxxx Xxxxxxxxx
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Xxxx Xxxxx Xxxxxxx, Xxxxxxx 00000
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Attention:Β General Counsel
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E-mail:
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Xxxxx.XXxxxxx@xxxxxxx.xxx
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with a copy to:
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Wachtell, Lipton, Xxxxx & Xxxx
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00 Xxxx 00xx Xxxxxx
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Xxx Xxxx, Xxx Xxxx 00000
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Attention:
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Xxxxxx X. Xxxxxxxx
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Β | Β |
Xxxxxx X. Xxx
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Β | Β |
Xxxxx X. Xxxxxx
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Β | Β |
Xxxx X. Xxxxxxxxx
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E-mail:
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XXXxxxxxxx@xxxx.xxx
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Β | Β |
XXXxx@xxxx.xxx
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XXXxxxxx@xxxx.xxx
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XXXxxxxxxxx@xxxx.xxx
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If to Otis, to:
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Xxxx Worldwide Corporation
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Xxx Xxxxxxx Xxxxx
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Xxxxxxxxxx, Xxxxxxxxxxx 00000
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Attention:Β
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General Counsel |
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E-mail:
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Xxxx.XxXxxxxxxx@xxxx.xxx
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with a copy to:
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Wachtell, Lipton, Xxxxx & Xxxx
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00 Xxxx 00xx Xxxxxx
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Xxx Xxxx, Xxx Xxxx 00000
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Attention:
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Xxxxxx X. Xxxxxxxx
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Β | Β |
Xxxxxx X. Xxx
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Xxxxx X. Xxxxxx
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Xxxx X. Xxxxxxxxx
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E-mail:
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XXXxxxxxxx@xxxx.xxx
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XXXxx@xxxx.xxx
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XXXxxxxx@xxxx.xxx
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XXXxxxxxxxx@xxxx.xxx
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A Party may, by notice to the other Parties, change the address to which such notices are to be given or made.
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10.6Β Β Β Β Β Β Β Severability.Β If any provision of this Agreement or any Ancillary Agreement or the application thereof to any Person or circumstance is
determined by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions hereof or thereof, or the application of such provision to Persons or circumstances or in jurisdictions other than those as to which it
has been held invalid or unenforceable, shall remain in full force and effect and shall in no way be affected, impaired or invalidated thereby.Β Upon such determination, the Parties shall negotiate in good faith in an effort to agree upon such a
suitable and equitable provision to effect the original intent of the Parties.
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10.7Β Β Β Β Β Β Β Force Majeure.Β No Party shall be deemed in default of this Agreement or, unless otherwise expressly provided therein, any Ancillary Agreement
for any delay or failure to fulfill any obligation (other than a payment obligation) hereunder or thereunder so long as and to the extent to which any delay or failure in the fulfillment of such obligation is prevented, frustrated, hindered or
delayed as a consequence of circumstances of Force Majeure.Β In the event of any such excused delay, the time for performance of such obligations (other than a payment obligation) shall be extended for a period equal to the time lost by reason of
the delay.Β A Party claiming the benefit of this provision shall, as soon as reasonably practicable after the occurrence of any such event, (a) provide written notice to the other Parties of the nature and extent of any such Force Majeure
condition; and (b) use commercially reasonable efforts to
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remove any such causes and resume performance under this Agreement and the Ancillary Agreements, as applicable, as soon as reasonably practicable.
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10.8Β Β Β Β Β Β Β No Set-Off.Β Except as expressly set forth in any Ancillary Agreement or as otherwise mutually agreed to in writing by the Parties, none of the
Parties nor any member of their respective Groups shall have any right of set-off or other similar rights with respect to (a) any amounts received pursuant to this Agreement or any Ancillary Agreement; or (b) any other amounts claimed to be owed to
the other Parties or any member of their respective Groups arising out of this Agreement or any Ancillary Agreement.
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10.9Β Β Β Β Β Β Β Expenses.Β Except as otherwise expressly set forth in this Agreement or any Ancillary Agreement, or as otherwise agreed to in writing by the
Parties, all third party fees, costs and expenses, and all other fees, costs and expenses, in each case incurred in connection with the preparation, execution, delivery and implementation of this Agreement, including the Separation and the
Distributions, and any Ancillary Agreement, the Information Statements, the Plan of Reorganization and the consummation of the transactions contemplated hereby and thereby will be borne, to the extent incurred at or prior to the Effective Time, by
UTC, and to the extent incurred at any time following the Effective Time, by the Party or its applicable Subsidiary incurring such fees, costs or expenses.Β The Parties agree that certain specified costs and expenses shall be allocated between the
Parties as set forth on Schedule 10.9.
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10.10Β Β Β Β Β Headings.Β The article, section and paragraph headings contained in this Agreement and in the Ancillary Agreements are for reference purposes only
and shall not affect in any way the meaning or interpretation of this Agreement or any Ancillary Agreement.
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10.11 Β Β Β Survival of Covenants.Β Except as expressly set forth in this Agreement or any Ancillary Agreement, the covenants, representations and warranties
contained in this Agreement and each Ancillary Agreement, and Liability for the breach of any obligations contained herein, shall survive the Separation and the Distributions and shall remain in full force and effect.
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10.12Β Β Β Β Β Waivers of Default.Β Waiver by a Party of any default by another Party of any provision of this Agreement or any Ancillary Agreement shall not be
deemed a waiver by the waiving Party of any subsequent or other default, nor shall it prejudice the rights of any other Party.Β No failure or delay by a Party in exercising any right, power or privilege under this Agreement or any Ancillary
Agreement shall operate as a waiver thereof, nor shall a single or partial exercise thereof prejudice any other or further exercise thereof or the exercise of any other right, power or privilege.
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10.13Β Β Β Β Β Specific Performance.Β Subject to the provisions of Article VII, in the event of any actual or threatened default in, or breach of, any of
the terms, conditions and provisions of this Agreement or any Ancillary Agreement, the Party or Parties who are, or are to be, thereby aggrieved shall have the right to specific performance and injunctive or other equitable relief in respect of its
or their rights under this Agreement or such Ancillary Agreement, in addition to any and all other rights and remedies at law or in equity, and all such rights and remedies shall be cumulative.Β The Parties agree that the remedies at law for any
breach or threatened breach, including monetary damages, are inadequate compensation for any
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loss and that any defense in any Action for specific performance that a remedy at law would be adequate is waived.Β Any requirements for the securing or posting of any bond with such remedy are waived by each of the
Parties.
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10.14Β Β Β Amendments.Β No provisions of this Agreement or any Ancillary Agreement shall be deemed waived, amended, supplemented or modified by a Party,
unless such waiver, amendment, supplement or modification is in writing and signed by the authorized representatives of the Parties against whom it is sought to enforce such waiver, amendment, supplement or modification; provided that, from
the First Effective Time to the Second Effective Time, provisions of this Agreement or any Ancillary Agreement may be waived, amended, supplemented or modified (a) if the Carrier Distribution occurs prior to the Otis Distribution, without the
consent of Carrier, so long as such waiver, amendment, supplement or modification does not adversely affect in any material respect any provisions of, or obligations under, this Agreement that are for the benefit of Carrier, or materially prejudice
or otherwise adversely affect in any material respect any rights of Carrier or any member of its Group under this Agreement and (b) if the Otis Distribution occurs prior to the Carrier Distribution, without the consent of Otis, so long as such
waiver, amendment, supplement or modification does not adversely affect in any material respect any provisions of, or obligations under, this Agreement that are for the benefit of Otis or materially prejudice or otherwise adversely affect in any
material respect any rights of Otis or any member of its Group under this Agreement.
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10.15Β Β Β Β Β Interpretation.Β In this Agreement and any Ancillary Agreement, (a)Β words in the singular shall be deemed to include the plural and vice versa and
words of one gender shall be deemed to include the other genders as the context requires; (b) the terms βhereof,β βherein,β and βherewithβ and words of similar import shall, unless otherwise stated, be construed to refer to this Agreement (or the
applicable Ancillary Agreement) as a whole (including all of the Schedules, Exhibits and Appendices hereto and thereto) and not to any particular provision of this Agreement (or such Ancillary Agreement); (c) Article, Section, Schedule, Exhibit and
Appendix references are to the Articles, Sections, Schedules, Exhibits and Appendices to this Agreement (or the applicable Ancillary Agreement) unless otherwise specified; (d) unless otherwise stated, all references to any agreement (including this
Agreement and each Ancillary Agreement) shall be deemed to include the exhibits, schedules and annexes (including all Schedules, Exhibits and Appendixes) to such agreement; (e) the word βincludingβ and words of similar import when used in this
Agreement (or the applicable Ancillary Agreement) shall mean βincluding, without limitation,β unless otherwise specified; (f) the word βorβ shall not be exclusive; (g) unless otherwise specified in a particular case, the word βdaysβ refers to
calendar days; (h) references to βbusiness dayβ shall mean any day other than a Saturday, a Sunday or a day on which banking institutions are generally authorized or required by law to close in the United States, New York, New York, Palm Beach
Gardens, Florida, or Farmington, Connecticut; (i) references herein to this Agreement or any other agreement contemplated herein shall be deemed to refer to this Agreement or such other agreement as of the date on which it is executed and as it may
be amended, modified or supplemented thereafter, unless otherwise specified; (j) unless expressly stated to the contrary in this Agreement or in any Ancillary Agreement, all references to βthe date hereof,β βthe date of this Agreement,β βherebyβ
and βhereuponβ and words of similar import shall be references to April 2, 2020; and (k) the word βextentβ and the phrase βto the extentβ shall mean the degree to which a subject or other thing extends, and such word or phrase shall not merely mean
βif.β
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10.16Β Β Β Β Β Limitations of Liability.Β Notwithstanding anything in this Agreement to the contrary, none of Carrier or any member of the Carrier Group, Otis or
any member of the Otis Group or UTC or any member of the UTC Group shall be liable under this Agreement to any other Party or member of its Group for any indirect, punitive, exemplary, remote, speculative or similar damages in excess of
compensatory damages of such other Party or member of its Group arising in connection with the transactions contemplated hereby (other than any such Liability paid or actually payable in respect of a Third-Party Claim).
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10.17Β Β Β Β Β Performance.Β UTC will cause to be performed, and hereby guarantees the performance of, all actions, agreements and obligations set forth in this
Agreement or in any Ancillary Agreement to be performed by any member of the UTC Group.Β Carrier will cause to be performed, and hereby guarantees the performance of, all actions, agreements and obligations set forth in this Agreement or in any
Ancillary Agreement to be performed by any member of the Carrier Group.Β Otis will cause to be performed, and hereby guarantees the performance of, all actions, agreements and obligations set forth in this Agreement or in any Ancillary Agreement to
be performed by any member of the Otis Group.Β Each Party (including its permitted successors and assigns) further agrees that it will (a) give timely notice of the terms, conditions and continuing obligations contained in this Agreement and any
applicable Ancillary Agreement to all of the other members of its Group and (b) cause all of the other members of its Group not to take any action or fail to take any such action inconsistent with such Partyβs obligations under this Agreement, any
Ancillary Agreement or the transactions contemplated hereby or thereby.
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10.18Β Β Β Β Mutual Drafting.Β This Agreement and the Ancillary Agreements shall be deemed to be the joint work product of the Parties, and any rule of
construction that a document shall be interpreted or construed against a drafter of such document shall not be applicable.
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10.19Β Β Β Β Ancillary Agreements.
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(a)Β Β Β Β Β Β Β Β Β Β In the event of any conflict or inconsistency between the terms of this Agreement and the terms of the Transition Services Agreement, the Tax Matters Agreement, the Employee
Matters Agreement or the Intellectual Property Agreement (each, a βSpecified Ancillary Agreementβ), the terms of the applicable Specified Ancillary Agreement, shall
control with respect to the subject matter addressed by such Specified Ancillary Agreement to the extent of such conflict or inconsistency.
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(b)Β Β Β Β Β Β Β Β Β Β In the event of any conflict or inconsistency between the terms of this Agreement or any Specified Ancillary Agreement, on the one hand, and any Transfer Document, on the
other hand, including with respect to the allocation of Assets and Liabilities as among the Parties or the members of their respective Groups, this Agreement or such Specified Ancillary Agreement shall control.
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IN WITNESS WHEREOF, the Parties have caused this Separation and Distribution Agreement to be executed by their duly authorized representatives as of the date first written above.
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UNITED TECHNOLOGIES CORPORATION
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By:
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/s/ Xxxxxxx X. Xxxxxx
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Β | Β |
Name:
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Xxxxxxx X. Xxxxxx
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Title:
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Executive Vice President, Operations & Strategy
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XXXX WORLDWIDE CORPORATION
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By:
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/s/ Xxxxxxx X. Xxxx
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Β | Β |
Name:
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Xxxxxxx X. Xxxx
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Β | Β |
Title:
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Vice President, Controller
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CARRIER GLOBAL CORPORATION
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By:
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/s/ Xxxx Xxxxxxxx
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Name:
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Xxxx Xxxxxxxx
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Β | Β |
Title:
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Vice President, Controller
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[Signature Page to Separation and Distribution Agreement]
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