Exhibit 10.1
Master Separation and Sale Agreement
by and among
Schlumberger Technologies, Inc.,
Schlumberger Technology Corporation,
Schlumberger BV
and
NPTest, Inc.
_______ __, 2002
TABLE OF CONTENTS
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Page
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ARTICLE I SEPARATION ....................................................................................... 2
Section 1.1 Separation Date....................................................................... 2
Section 1.2 Closing of Transactions............................................................... 2
Section 1.3 Exchange of Secretary's Certificates.................................................. 2
Section 1.4 No Derogation from Prior Transfers.................................................... 2
Section 1.5 Transfers to NPT Include Transfers to Other Members of the NPT Group.................. 2
ARTICLE II DOCUMENTS AND ITEMS TO BE DELIVERED ON OR PRIOR TO THE SEPARATION DATE .......................... 3
Section 2.1 Documents to Be Delivered by Schlumberger............................................. 3
Section 2.2 Documents to Be Delivered by NPT...................................................... 4
ARTICLE III THE IPO AND ACTIONS PENDING THE IPO ............................................................ 4
Section 3.1 Transactions Prior to the IPO......................................................... 4
Section 3.2 Cooperation........................................................................... 4
Section 3.3 Conditions Precedent to Consummation of the IPO....................................... 5
ARTICLE IV THE SALE ........................................................................................ 6
Section 4.1 The Sale.............................................................................. 6
ARTICLE V COVENANTS AND OTHER MATTERS ...................................................................... 6
Section 5.1 Other Agreements...................................................................... 6
Section 5.2 Further Instruments................................................................... 6
Section 5.3 Intentionally Omitted................................................................. 7
Section 5.4 Agreement for Exchange of Information................................................. 7
Section 5.5 Auditors and Audits; Annual and Quarterly Statements and Accounting................... 8
Section 5.6 Consistency with Past Practices....................................................... 10
Section 5.7 Payment of Expenses................................................................... 10
Section 5.8 Dispute Resolution.................................................................... 10
Section 5.9 Governmental Approvals................................................................ 11
Section 5.10 No Representation or Warranty......................................................... 12
Section 5.11 Employee Agreements: Definition...................................................... 12
Section 5.12 Cooperation in Obtaining New Agreements................................................. 14
Section 5.13 Property Damage to NPT Assets Prior to the Separation Date.............................. 14
Section 5.14 Charter/bylaw Amendments................................................................ 14
Section 5.15 NPTest Board Representation............................................................. 15
ARTICLE VI MISCELLANEOUS ..................................................................................... 16
Section 6.1 Limitation of Liability................................................................. 16
Section 6.2 Entire Agreement........................................................................ 17
Section 6.3 Governing Law........................................................................... 17
Section 6.4 Descriptive Headings.................................................................... 17
Section 6.5 Termination............................................................................. 17
Section 6.6 Notices................................................................................. 17
Section 6.7 Counterparts............................................................................ 18
Section 6.8 Binding Effect; Assignment.............................................................. 18
Section 6.9 Severability............................................................................ 19
Section 6.10 Failure or Indulgence Not Waiver; Remedies Cumulative................................... 19
Section 6.11 Amendment............................................................................... 19
Section 6.12 Authority............................................................................... 19
Section 6.13 Conflicting Agreements.................................................................. 19
ARTICLE VII DEFINITIONS ...................................................................................... 20
Section 7.1 Affiliate............................................................................... 20
Section 7.2 "Ancillary Agreements".................................................................. 20
Section 7.3 Employee Agreement...................................................................... 20
Section 7.4 Governmental Approvals.................................................................. 20
Section 7.5 Governmental Authority.................................................................. 20
Section 7.6 Information............................................................................. 20
Section 7.7 IPO Closing Date........................................................................ 20
Section 7.8 Local Transfer Agreements............................................................... 20
Section 7.9 NPT Assets.............................................................................. 20
Section 7.10 NPT Group............................................................................... 20
Section 7.11 NPT's Auditors.......................................................................... 21
Section 7.12 Person.................................................................................. 21
Section 7.13 Schlumberger Group...................................................................... 21
Section 7.14 Schlumberger's Auditors................................................................. 21
Section 7.15 Subsidiary.............................................................................. 21
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MASTER SEPARATION AND SALE AGREEMENT
This Master Separation and Sale Agreement (this "Agreement") is entered
into as of _______ __, 2002, by and among Schlumberger Technologies, Inc., a
Delaware corporation ("STI"), Schlumberger Technology Corporation, a Texas
corporation ("STC"), Schlumberger BV, a company organized and existing under the
laws of the Netherlands ("SBV" and, together with STI, and STC, "Schlumberger"),
and NPTest, Inc. ("NPT"), a Delaware corporation. Capitalized terms used herein
and not otherwise defined herein shall have the meanings ascribed to such terms
in Article VII hereof.
RECITALS
WHEREAS, STI and SBV collectively own all of the currently issued and
outstanding common stock of NPT;
WHEREAS, NPT is engaged in certain aspects of the automated test
equipment business and related businesses (collectively, the "NPT Business") as
described in the Registration Statement on Form S-1, Registration No. 333-88710
(as amended or supplemented from time to time, the "IPO Registration
Statement");
WHEREAS, the Board of Directors of each of STI, STC, SBV and NPT has
determined that it would be appropriate and desirable for Schlumberger to
contribute and transfer to NPT, and for NPT to receive and assume, directly or
indirectly, certain assets and liabilities currently held, directly or
indirectly, by Schlumberger and associated with the NPT Business, as identified
in more detail herein (the "Separation");
WHEREAS, effective as of May 10, 2002, STI contributed and transferred
to NPT, and NPT received and assumed, assets and liabilities theretofore held by
Schlumberger and associated with the NPT Business that was theretofore conducted
by Schlumberger in the United States (the "U.S. Transfer");
WHEREAS, on or prior to the date of this Agreement, members of the
Schlumberger Group have transferred to members of the NPT Group certain assets
and liabilities associated with the NPT Business that was theretofore conducted
by Schlumberger outside the United States (together with the U.S. Transfer, the
"Prior Transfers"), with the intent of completing the Prior Transfers on or
before the Separation Date;
WHEREAS, Schlumberger and NPT currently contemplate that, following the
contribution and assumption of the assets and liabilities associated with the
NPT Business as identified herein, NPT will make an initial public offering
("IPO") of an amount of its common stock pursuant to the IPO Registration
Statement that will reduce STI's and SBV's combined ownership of NPT's issued
and outstanding shares of common stock after the IPO to not more than ____%,
assuming no exercise of the underwriters' over-allotment option;
WHEREAS, each of STI and SBV currently intends to divest its remaining
ownership in NPT through public or private sales of all of the shares of NPT
common stock owned by it at a time subsequent to the date of the IPO (the
"Sale"); and
WHEREAS, the parties intend in this Agreement, including the Exhibits
hereto, to set forth the principal arrangements between them regarding the
separation of NPT and the NPT Business from Schlumberger.
NOW, THEREFORE, in consideration of the foregoing and the covenants and
agreements set forth below, the parties hereto agree as follows:
ARTICLE I
SEPARATION
Section 1.1 Separation Date. Unless otherwise provided in this
Agreement, or in any agreement to be executed in connection with this Agreement,
the effective time and date of each transfer of property, assumption of
liability, license, undertaking, or agreement in connection with the Separation
shall be 12:01 a.m., Pacific Time, _______ __, 2002 or such other date as may be
fixed by the parties (the "Separation Date").
Section 1.2 Closing of Transactions. Unless otherwise provided herein,
the closing of the transactions contemplated in Article II shall occur by the
lodging of each of the executed instruments of transfer, assumptions of
liability, undertakings, agreements, instruments or other documents executed or
to be executed with Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP ("SASM&F"), 000
Xxxxxxxxxx Xxxxxx, Xxxx Xxxx, Xxxxxxxxxx 00000, to be held in escrow for
delivery as provided in Section 1.3.
Section 1.3 Exchange of Secretary's Certificates.
Upon receipt of a certificate of the Secretary or an Assistant
Secretary of each of STI, STC and SBV in the form attached to this Agreement as
Exhibit A, SASM&F shall deliver to NPT on behalf of STI, STC and SBV all of the
items required to be delivered by them hereunder pursuant to Section 2.1 and
each such item shall be deemed to be delivered to NPT as of the Separation Date
upon delivery of such certificate. Upon receipt of a certificate of the
Secretary or an Assistant Secretary of NPT in the form attached to this
Agreement as Exhibit B, SASM&F shall deliver to STI, STC and SBV on behalf of
NPT all of the items required to be delivered by NPT pursuant to Section 2.2
hereunder and each such item shall be deemed to be delivered to STI, STC and SBV
as of the Separation Date upon receipt of such certificate.
Section 1.4 No Derogation from Prior Transfers. For convenience, this
Agreement and the Ancillary Agreements may speak in the future tense as to
transfers to NPT or other members of the NPT Group of certain assets and
liabilities associated with the NPT Business, but nothing in this Agreement or
any Ancillary Agreement shall derogate from the fact that the Prior Transfers
have already been completed, and any reference to either or both of the Prior
Transfers in the future tense shall be construed as confirmatory of the same.
Section 1.5 Transfers to NPT Include Transfers to Other Members of the
NPT Group. References in this Agreement and the Ancillary Agreements to
transfers of assets and liabilities to NPT shall, where appropriate, include
transfers of certain assets and liabilities to other members of the NPT Group.
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ARTICLE II
DOCUMENTS AND ITEMS TO BE DELIVERED ON OR PRIOR TO THE SEPARATION DATE
Section 2.1 Documents to Be Delivered by Schlumberger. On the
Separation Date or such other date as agreed in connection with the Prior
Transfers, each of STI and SBV will deliver, or will cause its appropriate
Affiliates to deliver, to NPT all of the following items and agreements
(collectively, together with all agreements and documents contemplated by such
agreements, the "Ancillary Agreements"):
(a) A duly executed General Assignment and Assumption Agreement
(the "Assignment Agreement") substantially in the form attached hereto as
Exhibit C;
(b) A duly executed Master Technology Ownership and License
Agreement substantially in the form attached hereto as Exhibit D-1, a duly
executed Master Patent Ownership Agreement substantially in the form attached
hereto as Exhibit D-2 and a duly executed Master Trademark Ownership and License
Agreement substantially in the form attached as Exhibit D-3;
(c) A duly executed Employee Matters Agreement substantially in
the form attached hereto as Exhibit E;
(d) A duly executed Tax Sharing Agreement substantially in the
form attached hereto as Exhibit F;
(e) A duly executed Master Transitional Services Agreement
substantially in the form attached hereto as Exhibit G;
(f) A duly executed Real Estate Matters Agreement substantially
in the form attached hereto as Exhibit H;
(g) A duly executed Master Confidential Disclosure Agreement
substantially in the form attached hereto as Exhibit I;
(h) A duly executed Indemnification and Insurance Matters
Agreement substantially in the form attached hereto as Exhibit J;
(i) A duly executed Registration Rights Agreement substantially
in the form attached hereto as Exhibit K;
(j) The agreements, documents and instruments relating to the
Prior Transfers;
(k) Resignations of each person who is an officer or director
of Schlumberger or its Affiliates immediately prior to the Separation Date, and
who will be an employee of NPT or its Subsidiaries from and after the Separation
Date; and
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(l) Such other agreements, documents or instruments as the
parties may agree are necessary or desirable in order to achieve the purposes
hereof.
Section 2.2 Documents to Be Delivered by NPT. As of the Separation
Date, NPT will deliver to each of STI and SBV all of the following:
(a) In each case where NPT is a party to any agreement or
instrument referred to in Section 2.1, a duly executed counterpart of such
agreement or instrument; and
(b) Resignations of each person who is an officer or director
of NPT or its Subsidiaries immediately prior to the Separation Date, and who
will be an employee of Schlumberger or its Affiliates (excluding NPT and its
controlled Affiliates) from and after the Separation Date.
ARTICLE III
THE IPO AND ACTIONS PENDING THE IPO
Section 3.1 Transactions Prior to the IPO. Subject to the conditions
specified in Section 3.3, STI, SBV and NPT shall each use their reasonable
efforts to consummate the IPO. Such efforts shall include, but not necessarily
be limited to, those specified in this Section 3.1.
(a) Registration Statement. NPT, STI, STC and SBV shall
cooperate in preparing, filing with the Securities and Exchange Commission (the
"Commission") and causing to become effective a registration statement
registering the common stock of NPT under the Securities and Exchange Act of
1934, as amended (the "Exchange Act"), and any registration statements or
amendments thereof which are required to reflect the establishment of, or
amendments to, any employee benefit and other plans necessary or appropriate in
connection with the IPO, the Separation, the Sale or the other transactions
contemplated by this Agreement. NPT shall file such amendments or supplements to
the IPO Registration Statement as may be necessary in order to cause the same to
become and remain effective as required by law or by the underwriters for the
IPO (the "Underwriters"), including, but not limited to, filing such amendments
to the IPO Registration Statement as may be required by the underwriting
agreement to be entered into among NPT, STI, STC and SBV and the Underwriters
(in form and substance reasonably acceptable to NPT, STI, STC and SBV, the
"Underwriting Agreement"), the Commission, or federal, state or foreign
securities laws.
(b) Underwriting Agreement. Each of NPT, STI, STC and SBV shall
enter into the Underwriting Agreement, and shall comply with its obligations
thereunder, except as may otherwise be waived by the underwriters.
(c) NASDAQ or NYSE Listing. NPT shall use reasonable efforts to
apply to have its shares of the common stock to be issued in the IPO quoted on
The NASDAQ Stock Market's National Market (the "Nasdaq") or The New York Stock
Exchange ("NYSE") (each hereinafter being referred to as a "National Exchange"),
subject to official notice of issuance.
Section 3.2 Cooperation. NPT shall consult, and cooperate in all
respects, with STI and SBV in connection with the pricing of the common stock of
NPT to be offered in the IPO
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and shall, at their direction, promptly take any and all actions necessary or
desirable to consummate the IPO as contemplated by the IPO Registration
Statement and the Underwriting Agreement. Schlumberger shall have final
authority over the pricing for the NPT common stock to be offered in the IPO of
the secondary shares and number of shares to be so offered.
Section 3.3 Conditions Precedent to Consummation of the IPO. The IPO
closing is currently scheduled to occur on or before _______ __, 2002 (the "IPO
Closing Date"). The obligations of the parties to use their reasonable efforts
to consummate the IPO on or before the IPO Closing Date shall be conditioned on
the satisfaction of the following conditions:
(a) Registration Statement. The IPO Registration Statement
shall have been filed and declared effective by the Commission, and there shall
be no stop-order in effect with respect thereto.
(b) Blue Sky. The actions and filings with regard to state
securities and blue sky laws of the United States (and any comparable laws under
any foreign jurisdictions) shall have been taken and, where applicable, have
become effective or been accepted.
(c) National Exchange Listing. The common stock of NPT to be
issued in the IPO shall have been accepted for quotation on a National Exchange,
subject to official notice of issuance.
(d) Underwriting Agreement. Each of NPT, STI, STC and SBV shall
have entered into the Underwriting Agreement and all conditions to the
obligations of NPT and the Underwriters shall have been satisfied or waived.
(e) No Legal Restraints. No order, injunction or decree issued
by any court or agency of competent jurisdiction or other legal restraint or
prohibition preventing the consummation of the Separation or the IPO or any of
the other transactions contemplated by this Agreement shall be in effect.
(f) Regulatory Compliance. All regulatory notices or relevant
permissions have been received with respect to the IPO and Separation and all
relevant waiting periods have lapsed.
(g) Separation. The Separation shall have become effective by
execution and delivery of this Agreement and the Ancillary Agreements.
(h) Board Approval. The execution of this agreement and those
other agreements contemplated hereunder have been duly authorized by the Board
of Directors of each party.
(i) Other Actions. Such other actions as the parties hereto
may, based upon the advice of counsel, reasonably request to be taken prior to
the IPO in order to assure the successful completion of the IPO shall have been
taken.
(j) No Termination. This Agreement shall not have been
terminated in accordance with its terms.
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ARTICLE IV
THE SALE
Section 4.1 The Sale. The Sale may occur at one or more times (subject
to any agreed to lockup periods or required quiet periods) and in amounts to be
determined solely at the discretion of STI and SBV, taking into account business
and market conditions. NPT shall cooperate with STI and SBV in all respects to
accomplish each such Sale and shall, at their direction, promptly take any and
all actions necessary or desirable to effect any such Sale, including, without
limitation, the registration under the Securities Act of 1933, as amended (the
"Securities Act") of the common stock of NPT on an appropriate registration form
or forms to be designated by STI or SBV in accordance with the terms and
conditions set forth in the Registration Rights Agreement, or as otherwise
mutually agreed to among NPT, STI and SBV. Schlumberger shall have the sole
right to select any investment banker(s), manager(s) and underwriter(s) in
connection with the Sale, as well as any financial printer, except as otherwise
provided in the Registration Rights Agreement with respect to "piggyback"
rights; provided, however, that nothing herein shall prohibit each of NPT, STI
and SBV from engaging (at its own expense) its own financial, legal, accounting
and other advisors in connection with the Sale.
ARTICLE V
COVENANTS AND OTHER MATTERS
Section 5.1 Other Agreements. Schlumberger, SBV and NPT agree to
execute or cause to be executed by the appropriate parties and deliver, as
appropriate, such other agreements, instruments and other documents as may be
necessary or desirable in order to effect the purposes of this Agreement and the
Ancillary Agreements.
Section 5.2 Further Instruments. At the request of NPT, and without
further consideration, STI, STC and SBV will execute and deliver, and will cause
their respective applicable Affiliates to execute and deliver, to NPT and its
applicable Subsidiaries such other instruments of transfer, conveyance,
assignment, substitution and confirmation and take such action as NPT may
reasonably deem necessary or desirable to transfer, convey and assign to NPT and
its Subsidiaries and confirm NPT's and its Subsidiaries' title to all of the
assets, rights and other things of value contemplated to be transferred to NPT
and its Subsidiaries pursuant to this Agreement, the Ancillary Agreements and
any documents referred to therein, to put NPT and its Subsidiaries in actual
possession and operating control thereof and to permit NPT and its Subsidiaries
to exercise all rights with respect thereto (including, without limitation,
rights under contracts and other arrangements as to which the consent of any
third party to the transfer thereof shall not have previously been obtained). At
the request of STI, STC or SBV and without further consideration, NPT will
execute and deliver, and will cause its applicable Subsidiaries to execute and
deliver, to Schlumberger and its applicable Affiliates all instruments,
assumptions, novations, undertakings, substitutions or other documents and take
such other action as STI or SBV may reasonably deem necessary or desirable in
order to have NPT fully and unconditionally assume and discharge the liabilities
contemplated to be assumed by NPT under this Agreement or any document in
connection herewith and to relieve the Schlumberger Group of any liability or
obligation with respect thereto and evidence the same to third parties. Neither
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STI, STC, SBV nor NPT shall be obligated, in connection with the foregoing, to
expend money other than reasonable out-of-pocket expenses, attorneys' fees and
recording or similar fees. Furthermore, each party, at the request of the other
party hereto, shall execute and deliver such other instruments and do and
perform such other acts and things as may be necessary or desirable for
effecting completely the consummation of the transactions contemplated hereby.
Section 5.3 Intentionally Omitted.
Section 5.4 Agreement for Exchange of Information.
(a) Generally. Each of STI, SBV and NPT agrees to provide, or
cause to be provided, to each other, at any time before or after the IPO Closing
Date, as soon as reasonably practicable after written request therefor, any
Information in the possession or under the control of such party that the
requesting party reasonably needs (i) to comply with reporting, disclosure,
filing or other requirements imposed on the requesting party (including under
applicable securities laws) by a Governmental Authority having jurisdiction over
the requesting party, (ii) for use in any other judicial, regulatory,
administrative or other proceeding or in order to satisfy audit, accounting,
claims, regulatory, litigation or other similar requirements, (iii) to comply
with its obligations under this Agreement or any Ancillary Agreement or (iv) in
connection with the ongoing businesses of STI, SBV or NPT, or their respective
Affiliates, as the case may be; provided, however, that (a) any Confidential
Information so disclosed shall be subject to the terms of the Master
Confidential Disclosure Agreement, and (b) further provided that in the event
that any party determines that any such provision of Information could be
commercially detrimental, violate any law or agreement or waive any
attorney-client privilege, the parties shall take all reasonable measures to
permit the compliance with such obligations in a manner that avoids any such
harm or consequence.
(b) Internal Accounting Controls; Financial Information. After
the Separation Date, (i) each party shall maintain in effect at its own cost and
expense adequate systems and controls for its business to the extent necessary
to enable the other party to satisfy its reporting, accounting, audit and other
obligations, and (ii) each party shall provide, or cause to be provided, to the
other party and its Affiliates in such form as such requesting party shall
request, at no charge to the requesting party, all financial and other data and
information as the requesting party determines necessary or advisable in order
to prepare its financial statements and reports or filings with any Governmental
Authority.
(c) Ownership of Information. Any Information owned by a party
that is provided to a requesting party pursuant to this Section 5.4 shall be
deemed to remain the property of the providing party. Unless specifically set
forth herein, nothing contained in this Agreement shall be construed as granting
or conferring rights of license or otherwise in any such Information.
(d) Record Retention. To facilitate the possible exchange of
Information pursuant to this Section 5.4 and other provisions of this Agreement
after the Separation Date, each party agrees to use its reasonable efforts to
retain all Information in its respective possession or control on the Separation
Date substantially in accordance with the policies of Schlumberger as in effect
on the Separation Date. However, except as set forth in the Tax
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Sharing Agreement, at any time after the Separation Date, each party may amend
its respective record retention policies at such party's discretion; provided,
however, that if a party desires to effect the amendment within three years
after the Separation Date, the amending party must give 30 days' prior written
notice of such change in the policy to the other party to this Agreement.
(i) No party will destroy, or permit any of its Subsidiaries
to knowingly destroy, any Information that exists on the Separation Date (other
than Information that is permitted to be destroyed under the current record
retention policies of Schlumberger) and that falls under the categories listed
in Section 5.4(a), without first using reasonable efforts to notify the other
party of the proposed destruction and giving the other party the opportunity to
take possession of such Information prior to such destruction.
(e) Limitation of Liability. No party shall have any liability
to any other party in the event that any Information exchanged or provided
pursuant to this Section 5.4 is found to be inaccurate, in the absence of gross
negligence or willful misconduct by the party providing such Information. No
party shall have any liability to any other party if any Information is
destroyed or lost after reasonable efforts by such party to comply with the
provisions of this Section 5.4.
(f) Other Agreements Providing for Exchange of Information. The
rights and obligations granted under this Section 5.4 are subject to any
specific limitations, qualifications or additional provisions on the sharing,
exchange or confidential treatment of Information set forth in this Agreement
and any Ancillary Agreement, including the provisions of the Confidential
Disclosure Agreement.
(g) Production of Witnesses; Records; Cooperation. After the
Separation Date, except in the case of a legal or other proceeding by one party
against another party (which shall be governed by such discovery rules as may be
applicable under Section 5.10 or otherwise), each party hereto shall use its
reasonable efforts to make available to each other party, upon written request,
the former, current and future directors, officers, employees, other personnel
and agents of such party as witnesses and any books, records or other documents
within its control or which it otherwise has the ability to make available, 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
legal, administrative or other proceeding in which the requesting party may from
time to time be involved, regardless of whether such legal, administrative or
other proceeding is a matter with respect to which indemnification may be sought
hereunder. The requesting party shall bear all costs and expenses in connection
therewith, including legal fees.
Section 5.5 Auditors and Audits; Annual and Quarterly Statements and
Accounting. Each party agrees that, for so long as Schlumberger is required in
accordance with United States generally accepted accounting principles to
consolidate or record under the equity method NPT's results of operations and
financial position:
(a) Selection of Auditors. NPT shall not select a different
accounting firm from that used by Schlumberger to serve as its (and its
Subsidiaries') independent certified public accountants ("NPT's Auditors") for
purposes of providing an opinion on its consolidated
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financial statements without Schlumberger's prior written consent (which consent
may be withheld at Schlumberger's sole discretion).
(b) Date of Auditors' Opinion and Quarterly Reviews. NPT shall use its
reasonable efforts to enable the NPT Auditors to complete their audit such that
they will date their opinion on NPT's audited annual financial statements on the
same date that Schlumberger's independent certified public accountants
("Schlumberger's Auditors") date their opinion on Schlumberger's audited annual
financial statements, and to enable Schlumberger to meet its timetable for the
printing, filing and public dissemination of Schlumberger's annual financial
statements. NPT shall use its reasonable commercial efforts to enable the NPT
Auditors to complete their quarterly review procedures such that they will
provide clearance on NPT's quarterly financial statements on the same date that
Schlumberger's Auditors provide clearance on Schlumberger's quarterly financial
statements.
(c) Annual and Quarterly Financial Statements. NPT shall provide to
Schlumberger on a timely basis all Information that Schlumberger reasonably
requires to meet its schedule for the preparation, printing, filing, and public
dissemination of Schlumberger's annual and quarterly financial statements in
accordance with Schlumberger's financial procedures. Without limiting the
generality of the foregoing, NPT will provide all required financial Information
with respect to NPT and its Subsidiaries to NPT's Auditors in a sufficient and
reasonable time and in sufficient detail to permit NPT's Auditors to take all
steps and perform all reviews necessary to provide sufficient assistance to
Schlumberger's Auditors with respect to financial Information to be included or
contained in Schlumberger's annual and quarterly financial statements.
Similarly, Schlumberger shall provide to NPT on a timely basis all financial
Information that NPT reasonably requires to meet its schedule for the
preparation, printing, filing, and public dissemination of NPT's annual and
quarterly financial statements. Without limiting the generality of the
foregoing, Schlumberger will provide all required financial Information with
respect to Schlumberger and its Subsidiaries to Schlumberger's Auditors in a
sufficient and reasonable time and in sufficient detail to permit Schlumberger's
Auditors to take all steps and perform all reviews necessary to provide
sufficient assistance to NPT's Auditors with respect to Information that is
required to be included or contained in NPT's annual and quarterly financial
statements.
(d) Identity of Personnel Performing the Annual Audit and Quarterly
Reviews. NPT shall authorize NPT's Auditors to make available to Schlumberger's
Auditors both the personnel who performed or will perform the annual audits and
quarterly reviews of NPT and work papers related to the annual audits and
quarterly reviews of NPT, in all cases within a reasonable time prior to NPT's
Auditors' opinion date, so that Schlumberger's Auditors are able to perform the
procedures they consider necessary to take responsibility for the work of NPT's
Auditors as it relates to Schlumberger's Auditors' report on Schlumberger's
financial statements, all within sufficient time to enable Schlumberger to meet
its timetable for the printing, filing and public dissemination of
Schlumberger's annual and quarterly statements. Similarly, Schlumberger shall
authorize Schlumberger's Auditors to make available to NPT's Auditors both the
personnel who performed or will perform the annual audits and quarterly reviews
of Schlumberger and work papers related to the annual audits and quarterly
reviews of Schlumberger, in all cases within a reasonable time prior to
Schlumberger's Auditors' opinion date, so that NPT's Auditors are able to
perform the procedures they consider necessary to take
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responsibility for the work of Schlumberger's Auditors as it relates to NPT's
Auditors' report on NPT's statements, all within sufficient time to enable NPT
to meet its timetable for the printing, filing and public dissemination of NPT's
annual and quarterly financial statements.
(e) Access to Books and Records. NPT shall provide Schlumberger's
internal auditors and their designees access to NPT's and its Subsidiaries'
books and records so that Schlumberger may conduct reasonable audits relating to
the financial statements provided by NPT pursuant hereto as well as to the
internal accounting controls and operations of NPT and its Subsidiaries.
(f) Notice of Change in Accounting Principles. NPT shall give
Schlumberger as much prior notice as reasonably practicable of any proposed
determination of, or any significant changes in, its accounting estimates or
accounting principles from those in effect on the Separation Date. NPT will
consult with Schlumberger and, if requested by Schlumberger, NPT will consult
with Schlumberger's independent public accountants with respect thereto.
Schlumberger shall give NPT as much prior notice as reasonably practicable of
any proposed determination of, or any significant changes in, its accounting
estimates or accounting principles with respect to NPT from those in effect on
the Separation Date.
(g) Conflict with Third-Party Agreements. Nothing in Sections 5.4
or 5.5 shall require NPT to violate any agreement with any third party regarding
the confidentiality of confidential and proprietary information relating to that
third party or its business; provided, however, that in the event that NPT is
required under Sections 5.4 or 5.5 to disclose any such Information, NPT shall
use reasonable efforts to seek to obtain such third party's consent to the
disclosure of such information.
Section 5.6 Consistency with Past Practices. At all times before the
Separation Date, Schlumberger and NPT will conduct the NPT Business in the
ordinary course, consistent with past practices.
Section 5.7 Payment of Expenses. Except as otherwise provided in this
Agreement, the Ancillary Agreements or any other agreement between the parties
relating to the Separation, the IPO or the Sale, all costs and expenses of the
parties hereto in connection with the Separation, other than certain taxes (as
specified in the Ancillary Agreements) shall be borne by Schlumberger. The costs
and expenses of the parties hereto in connection with the IPO (other than
underwriting discounts and commissions) and the Sale shall be borne by STI and
SBV. Each party hereto shall be responsible for its own internal costs incurred
in connection with the Separation, the IPO and the Sale.
Section 5.8 Dispute Resolution.
(a) If a dispute, controversy or claim ("Dispute") arises between
the parties relating to the interpretation or performance of this Agreement or
the Ancillary Agreements, or the grounds for the termination hereof, appropriate
senior executives (e.g. director or V.P. level) of each party who shall have the
authority to resolve the matter shall meet to attempt in good faith to negotiate
a resolution of the Dispute prior to pursuing other available remedies. The
initial meeting between the appropriate senior executives shall be referred to
herein as the
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"Dispute Resolution Commencement Date." Discussions and correspondence relating
to trying to resolve such Dispute shall be treated as confidential information
developed for the purpose of settlement and shall be exempt from discovery or
production and shall not be admissible. If the senior executives are unable to
resolve the Dispute within 30 days from the Dispute Resolution Commencement
Date, and either party wishes to pursue its rights relating to such Dispute,
then the Dispute will be mediated by a mutually acceptable mediator appointed
pursuant to the mediation rules of JAMS/Endispute within 30 days after written
notice by one party to the other demanding non-binding mediation. Neither party
may unreasonably withhold consent to the selection of a mediator or the location
of the mediation. Both parties will share the costs of the mediation equally,
except that each party shall bear its own costs and expenses, including
attorney's fees, witness fees, travel expenses, and preparation costs. The
parties may also mutually agree to replace mediation with some other form of
non-binding or binding ADR.
(b) Any Dispute which the parties cannot resolve through mediation
within 90 days of the Dispute Resolution Commencement Date, unless otherwise
mutually agreed, shall be submitted to final and binding arbitration under the
then current Commercial Arbitration Rules of the American Arbitration
Association ("AAA"), by three arbitrators in Santa Xxxxx County, California.
Such arbitrators shall be selected by the mutual agreement of the parties or,
failing such agreement, shall be selected according to the aforesaid AAA rules.
The arbitrators will be instructed to prepare and deliver a written, reasoned
opinion stating their decision within 30 days of the completion of the
arbitration. The prevailing party in such arbitration shall be entitled to
expenses, including costs and reasonable attorneys' and other professional fees,
incurred in connection with the arbitration (but excluding any costs and fees
associated with prior negotiation or mediation). The decision of the arbitrator
shall be final and non-appealable and may be enforced in any court of competent
jurisdiction. The use of any ADR procedures will not be construed under the
doctrine of laches, waiver or estoppel to adversely affect the rights of either
party.
(c) Any Dispute regarding the following is not required to be
negotiated, mediated or arbitrated prior to seeking relief from a court of
competent jurisdiction: breach of any obligation of confidentiality;
infringement, misappropriation, or misuse of any intellectual property right;
any other claim where interim or equitable relief from the court is sought to
prevent serious and irreparable injury to one of the parties or to others.
However, the parties to the Dispute shall make a good faith effort to negotiate
and mediate such Dispute, according to the above procedures, while such court
action is pending.
(d) Continuity of Service and Performance. Unless otherwise agreed
in writing, the parties will continue to provide service and honor all other
commitments under this Agreement and each Ancillary Agreement during the course
of dispute resolution pursuant to the provisions of this Section 5.8 with
respect to all matters not subject to such dispute, controversy or claim.
Section 5.9 Governmental Approvals. To the extent that the Separation
requires any Governmental Approvals, the parties will use their best efforts to
obtain any such Governmental Approvals.
11
Section 5.10 No Representation or Warranty. Schlumberger does not, in this
Agreement or any other agreement, instrument or document contemplated by this
Agreement, make any representation as to, warranty of or covenant with respect
to:
(a) the value of any asset or thing of value previously
transferred or to be transferred to NPT;
(b) the freedom from encumbrance or claims of any asset or thing
of value previously transferred or to be transferred to NPT;
(c) the transferability of rights, obligations, or licenses of
third parties with respect to the assets of the NPT Business;
(d) the absence of defenses or freedom from counterclaims with
respect to any claim previously transferred or to be transferred to NPT; or
(e) the legal sufficiency of any assignment, document or
instrument delivered or previously delivered hereunder to convey title to any
asset or thing of value upon its execution, deliver and filing.
Except as may expressly be set forth herein or in any Ancillary Agreement, all
assets previously transferred or to be transferred to NPT shall have been or
will be transferred "AS IS, WHERE IS" and NPT shall bear the economic and legal
risk that any conveyance shall prove to be insufficient to vest in NPT good and
marketable title, free and clear of any lien, claim, equity or other
encumbrance. NPT ACKNOWLEDGES AND AGREES THAT SCHLUMBERGER MAKES NO
REPRESENTATIONS OR EXTENDS ANY WARRANTIES WHATSOEVER, EXPRESS, IMPLIED OR
STATUTORY, WITH RESPECT THERETO, INCLUDING WITHOUT LIMITATION ANY WARRANTIES
CONCERNING THE QUALITY, SUFFICIENCY OR USEABILITY OF THE ASSETS TRANSFERRED
HEREUNDER, AND ANY IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, TITLE, ENFORCEABILITY OR NON-INFRINGEMENT. NPT ACKNOWLEDGES
THAT IT IS SOLELY RESPONSIBLE FOR ANY RESULTS OBTAINED FROM THE USE OF THE
ASSETS AND NPT HEREBY IRREVOCABLY WAIVES ANY CLAIMS IT MAY HAVE OR LATER MAY
HAVE AGAINST SCHLUMBERGER AND THE SCHLUMBERGER GROUP IN CONNECTION WITH SUCH
USE.
Section 5.11 Employee Agreements: Definition. As used in this Section
5.11, "Employee Agreement" means the Patent and Confidential Information
Agreement and corresponding agreements in foreign countries executed by each
Schlumberger employee.
(a) Survival of Employee Agreement Obligations and Schlumberger's
Common Law Rights. The Employee Agreements of all Schlumberger employees
transferred to NPT as of the IPO Closing Date shall remain in full force and
effect according to their terms; provided, however, that none of the following
acts committed by former Schlumberger employees within the scope of their NPT
employment shall constitute a breach of such Schlumberger Employee Agreements:
(i) the use or disclosure of Confidential Information (as that term is defined
in the former Schlumberger employee's Schlumberger Employee Agreement)
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for or on behalf of NPT, if such disclosure is consistent with the rights
granted to NPT and restrictions imposed on NPT under this Agreement, any
Ancillary Agreement or any other agreement between the parties; (ii) the
disclosure and assignment to NPT of rights in proprietary developments authored
or conceived by the former Schlumberger employee after the Separation Date and
resulting from the use of, or based upon intellectual property (whether patented
or not) which is retained by Schlumberger; provided, however, that in no event
shall such disclosure and assignment be regarded as assigning rights in or to
the underlying intellectual property to NPT, which rights are defined in the
Ancillary Agreements; or (iii) the rendering of any services, directly or
indirectly, to NPT to the extent such services are consistent with the
assignment or license of rights granted to NPT and the restrictions imposed on
NPT under this Agreement, any Ancillary Agreement or any other agreement between
the parties. Schlumberger retains any rights it has under statute or common law
with respect to actions by its former employees to the extent such actions are
inconsistent with the rights granted to NPT and restrictions imposed on NPT
under this Agreement, any Ancillary Agreement or any other agreement between the
parties.
(b) Assignment, Cooperation for Compliance and Enforcement.
(i) Schlumberger retains all rights under the Schlumberger
Employee Agreements of all former Schlumberger employees necessary to permit
Schlumberger to protect the rights and interests of Schlumberger, but hereby
transfers and assigns to NPT its rights under the Schlumberger Employee
Agreements of all former Schlumberger employees to the extent required to permit
NPT to enjoin, restrain, recover damages from or obtain specific performance of
the Schlumberger Employee Agreements or obtain other remedies against any
employee who breaches his/her Schlumberger Employee Agreement with respect to
matters relating to the NPT Business.
(ii) Schlumberger and NPT agree, at their own respective cost and
expense, to use their reasonable efforts to cooperate as follows: (A) NPT shall
advise Schlumberger of: (1) any violation(s) of the Schlumberger Employee
Agreements by former Schlumberger employees, and (2) any violation(s) of the NPT
Employee Agreement which affect Schlumberger's rights; and (B) Schlumberger
shall advise NPT of any violations of the Schlumberger Employee Agreements by
current or former Schlumberger employees which affect NPT's rights; provided,
however, that the foregoing obligations shall only apply to violations which
become known to an attorney within the legal department of the party obligated
to provide notice thereof.
(iii) Schlumberger and NPT each may separately enforce the
Schlumberger Employee Agreements of former Schlumberger employees to the extent
necessary to reasonably protect their respective interests, provided, however,
that (i) NPT shall not commence any legal action relating thereto without first
consulting with Schlumberger's General Counsel or his/her designee and (ii)
Schlumberger shall not commence any legal action relating thereto against any
former Schlumberger employee who is at the time an NPT employee without first
consulting with NPT's General Counsel or his/her designee. If either party, in
seeking to enforce any Schlumberger Employee Agreement, notifies the other party
that it is, in their legal advisor's reasonable opinion, desirable for such
party to join in such action, then the other party shall do so, provided however
that the party bringing such action and requiring such joinder shall pay any
13
expenses and costs (including legal fees) incurred by the other party. In
addition, if either party commences or becomes a party to any action to enforce
a Schlumberger Employee Agreement of a former Schlumberger employee, the other
party shall, whether or not it becomes a party to the action, cooperate with the
other party by making available its files and employees who have information or
knowledge relevant to the dispute, subject to appropriate measures to protect
the confidentiality of any proprietary or confidential information that may be
disclosed in the course of such cooperation or action and subject to any
relevant privacy laws and regulations. Any such action shall be conducted at the
expense of the party bringing the action and the parties shall agree on a case
by case basis on compensation, if any, of the other party for the value of the
time of such other party's employees as reasonably required in connection with
the action.
(iv) Schlumberger and NPT understand and acknowledge that
matters relating to the making, performance, enforcement, assignment and
termination of employee agreements are typically governed by the laws and
regulations of the national, federal, state or local governmental unit where an
employee resides, or where an employee's services are rendered, and that such
laws and regulations may supersede or limit the applicability or enforceability
of this Section 5.11. In such circumstances, Schlumberger and NPT agree to take
action with respect to the employee agreements that best accomplishes the
parties' objectives as set forth in this Section 5.11 and that is consistent
with applicable law.
Section 5.12 Cooperation in Obtaining New Agreements. The parties
understand that, prior to the Separation Date, NPT has derived benefits under
certain agreements and relationships between Schlumberger and third parties,
which agreements and relationships are not being assigned or transferred to NPT
in connection with the Separation. During the first year following the
Separation Date and upon the request of NPT, Schlumberger agrees to make
introductions of appropriate NPT personnel to Schlumberger's contacts at such
third parties, and agrees to provide reasonable assistance to NPT, at
Schlumberger's own expense, so that NPT may seek to enter into agreements or
relationships with such third parties. Such assistance may include, but is not
limited to, (i) requesting and encouraging such third parties to enter into such
agreements or relationships with NPT and (ii) attending meetings with NPT and
such third parties. The parties further understand that certain agreements
between Schlumberger and third parties which are being assigned to NPT in
connection with the Separation may require the consent of the applicable third
party. Schlumberger shall reasonably assist NPT in seeking to obtain the consent
of such third parties to such assignment(s).
Section 5.13 Property Damage to NPT Assets Prior to the Separation Date. In
the event of any property damage, other than ordinary wear and tear, to any NPT
Assets held by Schlumberger which occurs prior to the Separation Date,
Schlumberger shall, at its sole discretion, make its reasonable efforts to
repair or otherwise address such damage in the ordinary course of business
consistent with past practices; provided, however, that nothing in this clause
shall restrict Schlumberger from disposing of any Assets in the ordinary course
of business consistent with past practices.
Section 5.14 Charter/bylaw Amendments. So long as the Schlumberger Group
owns shares representing [ ]% of the voting power of all of the outstanding
shares of Common Stock of NPT, NPT will not, without the prior consent of
Schlumberger, adopt any amendments to its certificate of incorporation or bylaws
or take or recommend to its stockholders any action that
14
would (i) impose limitations on the legal rights of the Schlumberger Group as
NPT stockholders other than those imposed pursuant to the express terms of this
Agreement, including, without limitation, any action which would impose
restrictions (A) based upon the size of security holding, the business in which
a security holder is engaged or considerations applicable to the Schlumberger
Group and not to security holders generally, or (B) with reference to the Common
Stock generally, by means of the issuance of or proposal to issue any other
class of securities having voting power disproportionately greater than the
equity investment in NPT represented by such securities; (ii) involve the
issuance or corporate action providing for the issuance of any warrant, capital
stock, rights or other security that has rights (including rights of redemption)
that are dependent upon the amount of voting securities owned by the
Schlumberger Group; (iii) deny any benefit to the Schlumberger Group
proportionately as holders of any class of voting securities that is made
available to other holders of the same class of voting securities generally; or
(iv) alter voting or other rights of the holders of any class of voting
securities so that any such rights (or the vote required with respect to any
matter) are determined with reference to the amount of voting securities held by
the Schlumberger Group; provided, that this Section 5.14 shall not prohibit NPT
from adopting a customary shareholder rights plan, reasonably satisfactory to
Schlumberger, or taking any action otherwise prohibited hereby, so long as the
Schlumberger Group is either expressly or as part of a class of stockholders
which includes the Schlumberger Group exempted from such action or the
limitations on legal rights imposed thereby with respect to the number of shares
of Common Stock owned by them at the time such plan is adopted.
Section 5.15 NPT Board Representation.
(a) For so long as the Schlumberger Group beneficially owns
shares representing less than 50% but more than 10% of the voting power of all
of the outstanding Common Stock, Schlumberger shall have the right to designate
for nomination by the NPT Board (or any nominating committee thereof) to the NPT
Board a proportionate number of members of the NPT Board, as calculated in
accordance with Section 5.15(d). Notwithstanding anything to the contrary set
forth herein, NPT's obligations with respect to the election or appointment of
Schlumberger designated members shall be limited to the obligations set forth
under subsections (b) and (c) below.
(b) NPT shall exercise all authority under applicable law and
shall use its best efforts to cause three persons designated by Schlumberger to
be elected to the NPT Board effective at or prior to the Separation Date.
Commencing with the annual meeting of stockholders of NPT to be held in 2003 and
prior to each annual meeting of stockholders of NPT thereafter, Schlumberger
shall be entitled to present to the NPT Board or any nominating committee
thereof such number of designees of Schlumberger (each, a "Schlumberger
Designee") for election at such annual meeting as would result in Schlumberger
having the appropriate number of Schlumberger Designees on the NPT Board as
determined pursuant to subsection (a) above.
(c) NPT shall at all such times exercise all authority under
applicable law and use its best efforts to cause all such designees to be
nominated as Board members by the nominating committee of the NPT Board if there
is such a committee or by the NPT Board otherwise. NPT shall cause each
Schlumberger Designee for election to the NPT Board to be
15
included in the slate of designees recommended by the NPT Board to NPT's
stockholders for election as directors at each annual meeting of the
stockholders of NPT (or at any special meeting held for the election of
directors) and shall use its best efforts to cause the election of each such
Schlumberger Designee, including soliciting proxies in favor of the election of
such person. In the event that any Schlumberger Designee elected to the NPT
Board shall cease to serve as a director for any reason, the vacancy resulting
therefrom shall be filled by the NPT Board with a substitute Schlumberger
Designee, unless such vacancy was caused by action of stockholders (in which
case, in accordance with NPT's Restated Certificate of Incorporation, the
stockholders shall fill such vacancy). In the event that as a result of an
increase in the size of the NPT Board, Schlumberger is entitled to have one or
more additional Schlumberger Designees elected to the NPT Board pursuant to
subsection (a) above, the NPT Board shall appoint the appropriate number of such
additional Schlumberger Designees, unless such increase in size of the NPT Board
was caused by the action of stockholders (in which case, in accordance with
NPT's Restated Certificate of Incorporation, the stockholders shall elect such
additional director or directors). The parties hereto agree that the directors
of NPT identified in the Registration Statement include three Schlumberger
Designees.
(d) If at any time that Schlumberger Designees are to serve on
the NPT Board, Schlumberger beneficially owns shares representing less than 50%
but more than 10% of the total voting power of all of the outstanding Common
Stock of NPT, the number of persons Schlumberger shall be entitled to designate
for nomination by the NPT Board (or any nominating committee thereof) for
election to the NPT Board shall be equal to the number of directors computed
using the following formula (rounded to the nearest whole number): the product
of (1) the percentage of the voting power of all of the outstanding shares of
Common Stock of NPT beneficially owned by the Schlumberger Group and (2) the
number of directors then on the NPT Board (assuming no vacancies exist).
Notwithstanding the foregoing, if Schlumberger beneficially owns shares of
Common Stock of NPT representing less than 50% of the total voting power of all
outstanding shares of voting stock of NPT and the calculation of the formula set
forth in the foregoing sentence would result in Schlumberger being entitled to
elect a majority of the members of the NPT Board, the formula will be
recalculated with the product being rounded down to the nearest whole number. If
the number of Schlumberger Designees serving on the NPT Board exceeds the number
determined pursuant to the foregoing sentences of this Section 5.15(d) (such
difference being herein called the "Excess Director Number"), then Schlumberger
shall, upon request of the NPT Board (with the Schlumberger Designees
abstaining), use its reasonable best efforts to cause Schlumberger Designees
selected by Schlumberger in its sole discretion (the number of which designees
shall be equal to the Excess Director Number) to promptly resign from the NPT
Board, and, to the extent such persons do not so resign, Schlumberger shall
assist NPT in increasing the size of the NPT Board, so that after giving effect
to such increase, the number of Schlumberger Designees on the NPT Board is in
accordance with the provisions of this Section 5.15(d).
ARTICLE VI
MISCELLANEOUS
Section 6.1 Limitation of Liability. IN NO EVENT SHALL ANY MEMBER OF
THE SCHLUMBERGER GROUP OR NPT GROUP BE LIABLE TO ANY OTHER MEMBER
16
OF THE SCHLUMBERGER GROUP OR NPT GROUP FOR ANY SPECIAL, CONSEQUENTIAL, INDIRECT,
INCIDENTAL OR PUNITIVE DAMAGES, LOST PROFITS, LOSS OF BUSINESS, LOSS OF USE OF
ASSETS, LOSS OF VALUE OF ASSETS, LOSS OF DATA, COST OF COVER, OR BUSINESS
INTERRUPTION HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY (INCLUDING
NEGLIGENCE) ARISING IN ANY WAY OUT OF THIS AGREEMENT, WHETHER OR NOT SUCH PARTY
HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES; PROVIDED, HOWEVER, THAT THE
FOREGOING LIMITATIONS SHALL NOT LIMIT EACH PARTY'S INDEMNIFICATION OBLIGATIONS
FOR THOSE LIABILITIES THAT ARE SET FORTH IN THE INDEMNIFICATION AND INSURANCE
MATTERS AGREEMENT. THE FOREGOING LIMITATION WILL NOT LIMIT EITHER PARTY'S
OBLIGATIONS WITH RESPECT TO PAYMENT OF DAMAGES OF ANY KIND INCLUDED IN AN AWARD
OR SETTLEMENT OF A THIRD PARTY CLAIM UNDER ANY INDEMNITY OR INFRINGEMENT DEFENSE
PROVISIONS SPECIFIED HEREIN OR IN THE ANCILLARY AGREEMENTS.
Section 6.2 Entire Agreement. This Agreement, the Ancillary Agreements,
the Exhibits and Schedules referenced or attached hereto and thereto and the
agreements and documents pertaining to the Prior Transfers constitute the entire
agreement between the parties with respect to the subject matter hereof and
thereof and shall supersede all prior written and oral and all contemporaneous
oral agreements and understandings with respect to the subject matter hereof and
thereof.
Section 6.3 Governing Law. This Agreement shall be construed in
accordance with and all Disputes hereunder shall be governed by the laws of the
State of Delaware, excluding its conflict of law rules and the United Nations
Convention on Contracts for the International Sale of Goods.
Section 6.4 Descriptive Headings. The headings contained in this
Agreement, in any Exhibit or Schedule hereto and in the table of contents to
this Agreement are for reference purposes only and shall not affect in any way
the meaning or interpretation of this Agreement. Any capitalized term used in
any Exhibit or Schedule but not otherwise defined therein, shall have the
meaning assigned to such term in this Agreement. When a reference is made in
this Agreement to an Article or a Section, Exhibit or Schedule, such reference
shall be to an Article or Section of, or an Exhibit or Schedule to, this
Agreement unless otherwise indicated.
Section 6.5 Termination. This Agreement and all Ancillary Agreements
may be terminated and the IPO Closing abandoned at any time prior to the IPO
Closing Date by and in the sole discretion of Schlumberger without the approval
of NPT. This Agreement may be terminated at any time after the IPO Closing Date
and before the Sale Date by mutual consent of Schlumberger and NPT. In the event
of termination pursuant to this Section 6.5, no party shall have any liability
of any kind to the other party.
Section 6.6 Notices. Notices, offers, requests or other communications
required or permitted to be given by either party pursuant to the terms of this
Agreement shall be given in writing to the respective parties to the following
addresses:
17
if to STI:
Schlumberger Technologies, Inc.
[To Come]
Attention: [__________]
Telephone: [__________]
Facsimile: [__________]
if to SBV:
Schlumberger BV
[To Come]
Attention: [__________]
Telephone: [__________]
Facsimile: [__________]
if to STC:
Schlumberger Technology Corporation
[To Come]
Attention: [__________]
Telephone: [__________]
Facsimile: [__________]
if to NPT:
NPTest, Inc.
[To Come]
Attention: General Counsel
Telephone: [__________]
Facsimile: [__________]
or to such other address as the party to whom notice is given may have
previously furnished to the other in writing as provided herein. Any notice
involving non-performance, termination, or renewal shall be sent by hand
delivery, recognized overnight courier or, within the United States, may also be
sent via certified mail, return receipt requested. All other notices may also be
sent by fax, confirmed by first class mail. All notices shall be deemed to have
been given and received on the earlier of actual delivery or three days from the
date of postmark.
Section 6.7 Counterparts. This Agreement, including the Ancillary
Agreement and the Exhibits and Schedules hereto and thereto and the other
documents referred to herein or therein, may be executed in counterparts, each
of which shall be deemed to be an original but all of which shall constitute one
and the same agreement.
Section 6.8 Binding Effect; Assignment. No party may, directly or
indirectly, in whole or in part, whether by operation of law or otherwise,
assign or transfer this Agreement, without the other parties' prior written
consent, and any attempted assignment, transfer or
18
delegation without such prior written consent shall be voidable at the sole
option of such other parties. Notwithstanding the foregoing, each party (or its
permitted successive assignees or transferees hereunder) may assign or transfer
this Agreement as a whole without consent to an entity that succeeds to all or
substantially all of the business or assets of such party. Without limiting the
foregoing, this Agreement will be binding upon and inure to the benefit of the
parties and their permitted successors and assigns.
Section 6.9 Severability. If any term or other provision of this
Agreement or the Exhibits or Schedules attached hereto is determined by a court,
administrative agency or arbitrator to be invalid, illegal or incapable of being
enforced by any rule of law or public policy, all other conditions and
provisions of this Agreement shall nevertheless remain in full force and effect
so long as the economic or legal substance of the transactions contemplated
hereby is not affected in any manner materially adverse to either party. Upon
such determination that any term or other provision is invalid, illegal or
incapable of being enforced, the parties hereto shall negotiate in good faith to
modify this Agreement so as to effect the original intent of the parties as
closely as possible in an acceptable manner to the end that transactions
contemplated hereby are fulfilled to the fullest extent possible.
Section 6.10 Failure or Indulgence Not Waiver; Remedies Cumulative. No
failure or delay on the part of either party hereto in the exercise of any right
hereunder shall impair such right or be construed to be a waiver of, or
acquiescence in, any breach of any representation, warranty or agreement herein,
nor shall any single or partial exercise of any such right preclude other or
further exercise thereof or of any other right. All rights and remedies existing
under this Agreement or the Exhibits or Schedules attached hereto are cumulative
to, and not exclusive of, any rights or remedies otherwise available.
Section 6.11 Amendment. No change or amendment will be made to this
Agreement or the Exhibits or Schedules attached hereto except by an instrument
in writing signed on behalf of each of the parties to such agreement.
Section 6.12 Authority. Each of the parties hereto represents to the
other that (a) it has the corporate or other requisite power and authority to
execute, deliver and perform this Agreement, (b) the execution, delivery and
performance of this Agreement by it have been duly authorized by all necessary
corporate or other actions, (c) it has duly and validly executed and delivered
this Agreement, and (d) this Agreement is a legal, valid and binding obligation,
enforceable against it in accordance with its terms subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and general equity principles.
Section 6.13 Conflicting Agreements. In the event of conflict between
this Agreement and any Ancillary Agreement or other agreement executed in
connection herewith, including any agreements executed in connection with the
Prior Transfers, the provisions of such other agreement shall prevail.
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ARTICLE VII
DEFINITIONS
Section 7.1 Affiliate. "Affiliate" of any Person means any entity that
controls, is controlled by, or is under common control with such Person. As used
herein, "control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of such entity,
whether through ownership of voting securities or other interests, by contract
or otherwise.
Section 7.2 Ancillary Agreements
"Ancillary Agreements" has the meaning set forth in Section 2.1 hereof.
Section 7.3 Employee Agreement.
"Employee Agreement" has the meaning set forth in Section 5.11 hereof.
Section 7.4 Governmental Approvals. "Governmental Approvals" means any
notices, reports or other filings to be made, or any consents, registrations,
approvals, permits or authorizations to be obtained from, any Governmental
Authority.
Section 7.5 Governmental Authority. "Governmental Authority" shall
mean any federal, state, local, foreign or international court, government,
department, commission, board, bureau, agency, official or other regulatory,
administrative or governmental authority.
Section 7.6 Information. "Information" means 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, 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.
Section 7.7 IPO Closing Date. "IPO Closing Date" has the meaning set
forth in the Section 3.3 hereof.
Section 7.8 Local Transfer Agreements. "Local Transfer Agreements"
means the agreements, documents and instruments relating to the Prior Transfers.
Section 7.9 NPT Assets. "NPT Assets" has the meaning set forth in
Section 1.2 of the Assignment Agreement.
Section 7.10 NPT Group. "NPT Group" means NPT and each Subsidiary
immediately after the Separation Date or that is contemplated to be a Subsidiary
pursuant to this Agreement or
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the General Assignment and Assumption Agreement and each Person that becomes a
Subsidiary after the Separation Date.
Section 7.11 NPT's Auditors. "NPT's Auditors" means NPT's independent
certified public accountants.
Section 7.12 Person. "Person" means an individual, a partnership, a
corporation, a limited liability company, an association, a joint stock company,
a trust, a joint venture, an unincorporated organization and a governmental
entity or any department, agency or political subdivision thereof.
Section 7.13 Schlumberger Group. "Schlumberger Group" means
Schlumberger Limited, and each Subsidiary and Affiliate of Schlumberger Limited
(other than any member of the NPT Group).
Section 7.14 Schlumberger's Auditors. "Schlumberger's Auditors" means
Schlumberger's independent certified public accountants.
Section 7.15 Subsidiary. "Subsidiary" of any Person means a
corporation or other organization whether incorporated or unincorporated of
which at least a majority of the securities or interests having by the terms
thereof ordinary voting power to elect at least a majority of the board of
directors or others performing similar functions with respect to such
corporation or other organization is directly or indirectly owned or controlled
by such Person or by any one or more of its Subsidiaries, or by such Person and
one or more of its Subsidiaries; provided, however, that no Person that is not
directly or indirectly wholly-owned by any other Person shall be a Subsidiary of
such other Person unless such other Person controls, or has the right, power or
ability to control, that Person.
21
WHEREFORE, the parties have signed this Master Separation and Sale
Agreement effective as of the date first set forth above.
Schlumberger Technologies, Inc. NPTest, Inc.
By: _______________________________ By: ____________________________________
Name: Name:
Title: Title:
Schlumberger BV
By: _______________________________
Name:
Title:
Schlumberger Technology Corporation
By: _______________________________
Name:
Title:
22
EXHIBITS
Exhibit A Certificate of Secretary of STI or SBV
Exhibit B Certificate of Secretary of NPT
Exhibit C General Assignment and Assumption Agreement
Exhibit D-1 Master Technology Ownership and License Agreement
Exhibit D-2 Master Patent Ownership Agreement
Exhibit D-3 Master Trademark Ownership and License Agreement
Exhibit E Employee Matters Agreement
Exhibit F Tax Sharing Agreement
Exhibit G Master Transitional Services Agreement
Exhibit H Real Estate Matters Agreement
Exhibit I Master Confidential Disclosure Agreement
Exhibit J Indemnification and Insurance Matters Agreement
Exhibit K Registration Rights Agreement
EXHIBIT A
CERTIFICATE OF SECRETARY OF
[SCHLUMBERGER TECHNOLOGIES, INC. OR SCHLUMBERGER BV]
SECRETARY'S CERTIFICATE
I, _______________________________, Secretary of [Schlumberger
Technologies, Inc. or Schlumberger BV], a ____________ organized and existing
under the laws of __________________, DO HEREBY CERTIFY that attached hereto are
true and correct copies of certain resolutions adopted at a duly convened
meeting of the [Schlumberger Technologies, Inc. or Schlumberger BV] Board of
Directors on __________, 2002, which resolutions have not been amended, modified
or rescinded and remain in full force and effect on the date hereof.
IN WITNESS WHEREOF, I have hereunder set my hand and affixed the seal
of [Schlumberger Technologies, Inc. or Schlumberger BV] this __________ day of
__________, 2002.
_______________________________________
Secretary
EXHIBIT B
CERTIFICATE OF SECRETARY OF NPT, INC.
SECRETARY'S CERTIFICATE
I, ___________________________, Secretary of NPT, a corporation
organized and existing under the laws of the State of Delaware (the "Company"),
DO HEREBY CERTIFY that attached hereto are true and correct copies of certain
resolutions adopted at a duly convened meeting of the Company's Board of
Directors on __________, 2002, which resolutions have not been amended, modified
or rescinded and remain in full force and effect on the date hereof.
IN WITNESS WHEREOF, I have hereunder set my hand and affixed the seal
of the Company this __________ day of __________, 2002.
_______________________________________
Secretary
EXHIBIT C
GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT
EXHIBIT D-1
MASTER TECHNOLOGY OWNERSHIP AND LICENSE AGREEMENT
EXHIBIT D-2
MASTER PATENT OWNERSHIP AGREEMENT
EXHIBIT D-3
MASTER TRADEMARK OWNERSHIP AND LICENSE AGREEMENT
EXHIBIT E
EMPLOYEE MATTERS AGREEMENT
EXHIBIT F
TAX SHARING AGREEMENT
EXHIBIT G
MASTER TRANSITIONAL SERVICES AGREEMENT
EXHIBIT H
REAL ESTATE MATTERS AGREEMENT
EXHIBIT I
MASTER CONFIDENTIAL DISCLOSURE AGREEMENT
EXHIBIT J
INDEMNIFICATION AND INSURANCE MATTERS AGREEMENT
EXHIBIT K
REGISTRATION RIGHTS AGREEMENT
EXHIBIT L
REORGANIZATION OF OPERATIONS
(DOMESTIC AND INTERNATIONAL)
37
