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EXHIBIT 10.1
EXECUTION COPY
MASTER SEPARATION AGREEMENT
dated as of
December 22, 1998
among
GENERAL MOTORS CORPORATION,
DELPHI AUTOMOTIVE SYSTEMS CORPORATION,
DELPHI AUTOMOTIVE SYSTEMS LLC,
DELPHI TECHNOLOGIES, INC.
and
DELPHI AUTOMOTIVE SYSTEMS (HOLDING), INC.
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TABLE OF CONTENTS
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ARTICLE 1
Definitions
Section 1.01 Defined Terms...............................................2
ARTICLE 2
Contribution and Assumption
Section 2.01 Contribution of Assets......................................6
Section 2.02 Assumption of Liabilities...................................7
Section 2.03 Methods of Transfer and Assumption.........................7
Section 2.04 Nonassignable Contracts.....................................8
Section 2.05 Transition Services.........................................8
ARTICLE 3
Ancillary Agreements
Section 3.01 General....................................................10
Section 3.02 Priority...................................................10
Section 3.03 Extensions of Transition Services..........................10
ARTICLE 4
Covenants
Section 4.01 IPO and Distribution Agreement.............................10
Section 4.02 Registration Rights Agreement..............................10
Section 4.03 Delayed Asset Transfers....................................10
ARTICLE 5
Indemnification
Section 5.01 Indemnification by Delphi..................................11
Section 5.02 Indemnification Procedures.................................11
Section 5.03 Certain Limitations........................................12
ARTICLE 6
Access to Information
Section 6.01 Restrictions on Disclosure of Information..................13
Section 6.02 Legally Required Disclosure of Confidential Information....13
Section 6.03 Access to Information......................................13
Section 6.04 Record Retention...........................................14
Section 6.05 Production of Witnesses....................................16
Section 6.06 Reimbursement..............................................16
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ARTICLE 7
Certain Claims and Litigation
Section 7.01 Product Liability Claims...................................16
Section 7.02 General Litigation.........................................17
Section 7.03 Employment Related Claims..................................18
Section 7.04 Cooperation................................................18
ARTICLE 8
Insurance Matters
Section 8.01 Delphi Insurance Coverage During the Transition Period.....19
Section 8.02 Delphi Insurance Coverage After the Transition Period......20
ARTICLE 9
Miscellaneous
Section 9.01 Entire Agreement...........................................20
Section 9.02 Governing Law..............................................20
Section 9.03 Descriptive Headings.......................................20
Section 9.04 Notices....................................................20
Section 9.05 Parties In Intersest.......................................21
Section 9.06 Counterparts...............................................21
Section 9.07 Binding Effect; Assignment.................................21
Section 9.08 Dispute Resolution.........................................21
Section 9.09 Severability...............................................22
Section 9.10 Failure or Indulgence Not Waiver; Remedies Cumulative......22
Section 9.11 Amendment..................................................22
Section 9.12 Authority..................................................22
Section 9.13 Interpretation.............................................22
Schedule A Ancillary Agreements
Schedule B Delphi Financial Statements
Schedule C Facilities to be Transferred
Schedule D Covenants Not to Compete
Schedule E Domestic Ownership Interest Transfers
Schedule F International Ownership Interest Transfers
Schedule G Extension of Eligibility in the GM Vehicle Purchase Program -
Used Vehicle Program
Schedule H Extension of Eligibility in the GM New Vehicle Purchase
Program
Schedule I Certain Agreements with Respect to Divested Businesses
Schedule J Entities in Liquidation by 12/31/98 to be Retained by GM
Schedule K General Litigation Claims to be Transferred to Delphi
Schedule L General Litigation Claims to be Defended by GM at Delphi's
Expense
Schedule M Delphi Related General Litigation Claims for which GM will
Retain Liability
Schedule N Employment Related Claims to be Transferred to Delphi
Schedule O Employment Related Claims to be Jointly Defended by GM and
Delphi
Schedule P Entities Included in Delphi Financial Statements which are to
be retained by GM after 1/1/99
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MASTER SEPARATION AGREEMENT
This Master Separation Agreement ("Agreement") is entered into on
December 22, 1998 among General Motors Corporation, a Delaware corporation
("GM"), Delphi Automotive Systems Corporation, a Delaware corporation
("Delphi"), Delphi Automotive Systems LLC, a Delaware limited liability company
and, on the date hereof, a wholly owned subsidiary of GM ("DAS LLC"), Delphi
Technologies, Inc., a Delaware corporation and, on the date hereof, a wholly
owned subsidiary of GM ("DTI", and together with DAS LLC, the "Delphi U.S.
Subsidiaries") and Delphi Automotive Systems (Holding), Inc., a Delaware
corporation and, on the date hereof, a wholly owned subsidiary of GM ("Delphi
International Subsidiary"). Capitalized terms used herein and not otherwise
defined shall have the meanings ascribed to such terms in Article 1 hereof.
RECITALS
WHEREAS, the Board of Directors of GM has determined that it would be
appropriate and desirable to completely separate the Delphi Automotive Systems
Business from GM;
WHEREAS, GM has caused Delphi to be incorporated in order to effect
such separation, GM currently owns all of the issued and outstanding common
stock of Delphi, and Delphi currently conducts no business operations and has no
significant assets or liabilities;
WHEREAS, the Boards of Directors of GM and Delphi have each determined
that it would be appropriate and desirable for GM to contribute and transfer to
Delphi, and for Delphi to receive and assume, directly or indirectly,
substantially all of the assets and liabilities currently associated with the
Delphi Automotive Systems Business, including those assets and liabilities
currently held directly by GM in divisional form and the stock or similar
interests currently held by GM in subsidiaries and other entities that conduct
such business;
WHEREAS, GM and Delphi intend that the contribution and assumption of
assets and liabilities will qualify as a tax-free reorganization under Section
368(a)(1)(D) of the Code;
WHEREAS, GM and Delphi currently contemplate that, following the
contribution and assumption of assets and liabilities, Delphi will make an
initial public offering of an amount of its common stock that will reduce GM's
ownership of Delphi to not less than 80%;
WHEREAS, GM currently contemplates that, several months following such
initial public offering, GM will distribute to the holders of its common stock,
$1-2/3 par value, by means of an exchange offer and/or a pro rata distribution,
all of the shares of Delphi common stock owned by GM (the "Distribution");
WHEREAS, GM and Delphi intend that the Distribution will be tax-free to
GM and its stockholders under the Code; and
WHEREAS, the parties intend in this Agreement, including the Exhibits
and Schedules hereto, to set forth the principal arrangements between them
regarding the separation of the Delphi Automotive Systems Business from GM.
NOW, THEREFORE, in consideration of the foregoing and the covenants and
agreements set forth below, the parties hereto agree as follows:
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ARTICLE 1
DEFINITIONS
SECTION 1.01. Defined Terms. The following terms, as used herein, shall
have the following meanings:
"AFFILIATE" of any specified Person means any other Person directly or
indirectly Controlling, Controlled by, or under common Control with, such
specified Person; provided, however, that for purposes of this Agreement, (i) GM
and its subsidiaries (other than Delphi and its subsidiaries) shall not be
considered Affiliates of Delphi and (ii) Delphi and its subsidiaries shall not
be considered Affiliates of GM.
"AMENDED AND RESTATED TAX ALLOCATION AGREEMENT" means the Amended and
Restated Agreement for the Allocation of Federal, United States, State and Local
Income Tax, between GM and Delphi, a copy of which is attached hereto as Exhibit
L-3.
"ANCILLARY AGREEMENTS" means each of the agreements which are listed
on Schedule A hereto and which are attached as Exhibits A-1 through M-5 to this
Agreement, including any exhibits, schedules, attachments, tables or other
appendices thereto, and each agreement and other instrument contemplated
therein.
"ASSETS" means, except for cash and cash equivalents, any and all
assets, properties and rights, whether tangible or intangible, whether real,
personal or mixed, whether fixed, contingent or otherwise, and wherever located,
including, without limitation, the following:
(i) real property interests (including leases), land,
plants, buildings and improvements;
(ii) machinery, equipment, vehicles (other than GM
Product Evaluation Program vehicles), furniture and fixtures, leasehold
improvements, supplies, repair parts, tools, plant, laboratory and
office equipment and other tangible personal property, including any
and all leases with respect thereto, together with any rights or claims
arising out of the breach of any express or implied warranty by the
manufacturers or sellers of any of such assets or any component part
thereof;
(iii) inventories, including raw materials,
work-in-process, finished goods, parts and accessories;
(iv) notes, loans and accounts receivable (whether
current or not current), interests as beneficiary under letters of
credit, advances and performance and surety bonds;
(v) banker's acceptances, shares of stock, bonds,
debentures, evidences of indebtedness, certificates of interest or
participation in profit-sharing agreements, collateral-trust
certificates, investment contracts, voting trust certificates, puts,
calls, straddles, options, swaps, collars, caps and other securities or
hedging arrangements of any kind;
(vi) financial, accounting and operating data and
records including, without limitation, books, records, electronic data,
notes, sales and sales promotional data, purchasing materials and data,
advertising materials, credit information, cost and pricing
information, customer and supplier lists, reference catalogs, payroll
and personnel records, facility blueprints and plant layouts, minute
books, stock ledgers, stock transfer records and other similar
property, rights and information;
(vii) Intellectual Property;
(viii) Contracts and all rights therein;
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(ix) prepaid expenses, deposits and retentions held by
third parties;
(x) claims, causes of action, choses in action, rights
under insurance policies, rights under express or implied warranties,
rights of recovery, rights of set-off, and rights of subrogation;
(xi) licenses, franchises, permits, authorizations and
approvals; and
(xii) goodwill and going concern value.
"BUSINESS DAY" means a day other than a Saturday, a Sunday or a day on
which banking institutions located in the State of New York or Michigan are
authorized or obligated by law or executive order to close.
"CODE" means the Internal Revenue Code of 1986, as amended from time to
time, together with the rules and regulations promulgated thereunder.
"COMMERCIAL TRAVEL SERVICES SUPPLY AGREEMENT" means the Commercial
Travel Services Supply Agreement, effective as of the date Contribution Date,
between GM and Delphi (or their respective Affiliates), a copy of which is
attached hereto as Exhibit J-2.
"COMMISSION" means the Securities and Exchange Commission.
"CONFIDENTIAL INFORMATION" means with respect to any party hereto, (i)
any Information concerning such party, its business or any of its Affiliates
that was obtained by another party hereto prior to the Contribution Date, (ii)
any Information concerning such party that is obtained by another party under
Section 6.03, or (iii) any other Information obtained by, or furnished to,
another party hereto prior to the Contribution Date, in each case that (a) was
marked "Proprietary" or "Company Private" or words of similar import by the
party owning such Information, or any Affiliate of such party, or (b) the party
owning such Information notified such other party in writing was confidential or
secret by the Contribution Date.
"CONSOLIDATED TAX PERIOD" has the meaning set forth in the Amended and
Restated Tax Allocation Agreement.
"CONTRACTS" means any contract, agreement, lease, license, sales order,
purchase order, instrument or other commitment that is binding on any Person or
any part of its property under applicable law.
"CONTRIBUTION DATE" means January 1, 1999.
"CONTROL" means the possession, direct or indirect, of the power to
direct or cause the direction of the management of the policies of a Person,
whether through the ownership of voting securities, by contract or otherwise.
"CONTROLLING" and "CONTROLLED" have the corollary meanings ascribed thereto.
"DELPHI ASSETS" means all of GM's right, title and interest in and to
all Assets that (i) (x) are, except as set forth on Schedule P or as otherwise
provided herein or in an Ancillary Agreement, reflected in the Delphi Financial
Statements and not disposed of by GM after the date thereof and before the
Contribution Date (including assets written off or expensed but still used by
Delphi which Delphi can demonstrate to GM's reasonable satisfaction were paid
for by the Delphi Automotive Systems Sector of GM) or (y) are to be transferred
pursuant to Section 2.01(c) of this Agreement (as and when transferred
thereunder) or (ii) are acquired by the Delphi Automotive Systems Business after
the date of the Delphi Financial Statements and would be reflected in the
financial statements of Delphi as of the Contribution Date if such financial
statements were prepared using the same accounting principles under which the
Delphi Financial Statements were prepared, or (iii) are expressly provided by
this Agreement or any Ancillary Agreement to be transferred to Delphi, or (iv)
are listed on Schedule C hereto (which sets forth the facilities to be
transferred to Delphi) or (v) except as otherwise provided in an Ancillary
Agreement or other express agreement of the parties, are used exclusively by the
Delphi Automotive Systems Business as of the Contribution
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Date; provided, unless the parties otherwise expressly agree, that if the
accounting principles under which the Delphi Financial Statements were prepared
would have required any Asset described in the preceding clause (v) to be
reflected in the Delphi Financial Statements as of the date thereof, then such
Asset shall be included in the "Delphi Assets" only if so reflected.
"DELPHI AUTOMOTIVE SYSTEMS BUSINESS" means the business conducted by
the Delphi Automotive Systems Sector of GM at any time on or before the
Contribution Date, including (i) all business operations whose financial
performance is reflected in the Delphi Financial Statements, (ii) all business
operations initiated or acquired by the Delphi Automotive Systems Sector of GM
after the date of the Delphi Financial Statements and (iii) all business
operations that were conducted at any time in the past by the Delphi Automotive
Systems Sector of GM or by any predecessor of such Sector (including, without
limitation, the GM Automotive Components Group) but were discontinued or
disposed of prior to the date of the Delphi Financial Statements other than by
transfer or disposition to any other Sector of GM.
"DELPHI COMMON STOCK" means the Common Stock, $0.01 par value per
share, of Delphi.
"DELPHI FINANCIAL STATEMENTS" means the financial statements
(including the notes thereto) of Delphi for the period ended September 30, 1998
as set forth in the IPO Registration Statement as amended at the date of this
Agreement, a copy of which is set forth on Schedule B attached hereto.
"DELPHI LIABILITIES" means all of the Liabilities of GM that (i) (x)
are, except as otherwise set forth on Schedule P or as otherwise provided herein
or in an Ancillary Agreement, reflected in the Delphi Financial Statements and
remain outstanding at the Contribution Date or (y) are to be transferred
pursuant to Section 2.01(c) of this Agreement (as and when transferred
thereunder), or (ii) arise in connection with the Delphi Automotive Systems
Business after the date of the Delphi Financial Statements and would be
reflected in financial statements of Delphi as of the Contribution Date if such
financial statements were prepared using the same accounting principles under
which the Delphi Financial Statements were prepared, or (iii) are expressly
provided by this Agreement or any Ancillary Agreement to be transferred to and
assumed by Delphi, or (iv) except as otherwise provided in an Ancillary
Agreement or other express agreement of the parties, are related to or arise out
of or in connection with the Delphi Assets, or (v) except as otherwise provided
in an Ancillary Agreement or other express agreement of the parties, are related
to or arise out of or in connection with the Delphi Automotive Systems Business
(including but not limited to the covenants not to compete entered into by GM
prior to the Contribution Date set forth on Schedule D hereto) whether before or
after the date of the Delphi Financial Statements; provided, unless the parties
otherwise expressly agree, that if the accounting principles under which the
Delphi Financial Statements were prepared would have required any liabilities
described in the preceding clause (v) to be reflected in the Delphi Financial
Statements as of the date thereof, then such liabilities shall be considered to
be "Delphi Liabilities" only if so reflected.
"DETERMINATION" has the meaning set forth in the XXXX.
"DISTRIBUTION" has the meaning set forth in the preamble to this
Agreement.
"DISTRIBUTION DATE" means the date to be determined by GM in its sole
and absolute discretion when the Distribution is completed.
"EMPLOYEE MATTERS AGREEMENT" means the Employee Matters Agreement,
effective as of the Contribution Date, between GM and Delphi (or their
respective Affiliates), a copy of which is attached hereto as Exhibit B-1.
"FINANCIAL SERVICES SUPPLY AGREEMENT" means the Financial Services
Supply Agreement, effective as of the Contribution Date, between GM and Delphi
(or their respective Affiliates), a copy of which is attached hereto as Exhibit
J-4.
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"FINAL DETERMINATION" has the meaning set forth in the Amended and
Restated Tax Allocation Agreement.
"INCOME TAX RETURNS" has the meaning set forth in the Amended and
Restated Tax Allocation Agreement.
"INFORMATION" means all records, books, contracts, instruments,
computer data and other data.
"INTELLECTUAL PROPERTY" means any and all domestic and foreign patents
and patent applications, together with any continuations, continuations-in-part
or divisional applications thereof, and all patents issuing thereon (including
reissues, renewals and re-examinations of the foregoing); invention disclosures;
mask works; copyrights, and copyright applications and registrations;
trademarks, servicemarks, trade names, and trade dress, in each case together
with any applications and registrations therefor and all appurtenant goodwill
relating thereto; trade secrets, commercial and technical information, know-how,
proprietary or confidential information, including engineering, production and
other designs, notebooks, processes, drawings, specifications, formulae, and
technology; computer and electronic data processing programs and software
(object and source code), data bases and documentation thereof; inventions
(whether patented or not); and all other intellectual property under the laws of
any country throughout the world.
"IPO AND DISTRIBUTION AGREEMENT" means the agreement to be entered into
between GM and Delphi on or before the IPO Effective Date, the form of which is
attached hereto as Exhibit E-1.
"IPO EFFECTIVE DATE" means the date on which the IPO Registration
Statement is declared effective by the Commission.
"IPO REGISTRATION STATEMENT" means the registration statement on Form
S-1, Registration No. 333-67333 filed by Delphi with the Securities and Exchange
Commission in connection with the initial public offering of the Delphi Common
Stock, together with all amendments and supplements thereto.
"LIABILITIES" means any and all debts, liabilities, guarantees,
assurances, commitments and obligations, whether fixed, contingent or absolute,
asserted or unasserted, matured or unmatured, liquidated or unliquidated,
accrued or not accrued, known or unknown, due or to become due, whenever or
however arising (including, without limitation, whether arising out of any
Contract or tort based on negligence or strict liability) and whether or not the
same would be required by generally accepted accounting principles to be
reflected in financial statements or disclosed in the notes thereto.
"XXXX" means the Agreement for the Indemnification of United States
Federal, State and Local Non-Income Taxes, between GM and Delphi, a copy of
which is attached hereto as Exhibit L-2.
"NON-INCOME TAXES" has the meaning set forth in the XXXX.
"PERSON" means an individual, partnership, limited liability company,
joint venture, corporation, trust, unincorporated association, any other entity,
or a government or any department or agency or other unit thereof.
"PRIOR RELATIONSHIP" means the ownership relationship between GM and
Delphi at any time prior to the Contribution Date.
"REGISTRATION RIGHTS AGREEMENT" means the agreement to be entered into
between GM and Delphi on or before the IPO Effective Date, the form of which is
attached hereto as Exhibit E-2.
"REPRESENTATIVES" means directors, officers, employees, agents,
consultants, advisors, accountants, attorneys and representatives.
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"SUBSIDIARY" means with respect to any specified Person, any
corporation, any limited liability company, any partnership or other legal
entity of which such Person or any of its Subsidiaries Controls or owns,
directly or indirectly, more than 50% of the stock of other equity interest
entitled to vote on the election of the members to the board of directors or
similar governing body.
"SUPPLY AGREEMENT" means the Component Supply Agreement, effective as
of the Contribution Date, between GM and Delphi, a copy of which is attached
hereto as Exhibit K-1.
"THIRD-PARTY CLAIM" means any claim, suit, arbitration, inquiry,
proceeding or investigation by or before any court, governmental or other
regulatory or administrative agency or commission or any arbitration tribunal
asserted by a Person other than any party hereto or their respective Affiliates
which gives rise to a right of indemnification hereunder.
ARTICLE 2
CONTRIBUTION AND ASSUMPTION
SECTION 2.01. Contribution of Assets.
(a) Except as provided for in Section 2.01(c), on the Contribution
Date, GM (i) hereby transfers (or causes its appropriate Subsidiaries and
Representatives to transfer) the Delphi Assets in the following order: (A) all
intellectual property to be transferred pursuant to the intellectual property
agreements attached hereto as Exhibits G-1 through G-5, to DTI (except that all
Delco Electronics Corporation intellectual property shall be transferred to DTI
after GM has transferred its stock ownership interest in DTI to Delco
Electronics Corporation), (B) its stock ownership interest in DTI to Delco
Electronics Corporation, (C) its stock ownership interest in Delco Electronics
Corporation to DAS LLC and (D) all other Delphi Assets located in the United
States, including the ownership interests listed on Schedule E but excluding
those listed on Schedule F, to either Delphi or DAS LLC, and (ii) will have
transferred or shall transfer as promptly as reasonably practicable (or cause
its appropriate Subsidiaries and Representatives to transfer) the Delphi Assets
located outside of the United States and the ownership interests of the United
States and foreign entities listed on Schedule F owning such Delphi Assets, to
either Delphi, the Delphi International Subsidiary, or such other Subsidiary as
Delphi may direct. Each of Delphi, the Delphi U.S. Subsidiaries and Delphi
International Subsidiary shall receive and accept such Delphi Assets, subject to
the terms and conditions of this Agreement. GM further transfers to Delphi on
the Contribution Date but after the transfers described in clause (i) above, its
membership interest in DAS LLC and its stock ownership interest in the Delphi
International Subsidiary, effective as of the Contribution Date. Each of Delphi,
the Delphi U.S. Subsidiaries and Delphi International Subsidiary acknowledges
and agrees that the foregoing transfers will be made "AS IS WHERE IS" and that
neither GM nor any Subsidiary of GM has made or will make any warranty, express
or implied, including without limitation any warranty of merchantability of
fitness for a particular purpose, with respect to any Delphi Asset.
(b) On the Contribution Date, GM shall contribute to Delphi cash
and/or cash equivalents in the aggregate amount of $1 billion. Additionally, GM
shall contribute to Delphi such additional amounts as GM and Delphi agree,
corresponding to the amounts Delphi will pay to GM (or an Affiliate of GM) in
connection with the Canada and Brazil transactions described in Exhibits H-1 and
H-2, respectively.
(c) Notwithstanding any other provision of this Agreement, this
Agreement shall not transfer or effect the assignment or assumption of any
Assets or Liabilities of the Delphi Automotive Systems Business provided for in
the agreements constituting Exhibits H-1 through H-110 referred to in Schedule A
to this Agreement, except as such Assets and Liabilities shall be transferred
and assumed on the dates and in accordance with the terms set forth herein and
in such agreements.
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(d) GM and Delphi additionally shall comply with the terms of the
letters from GM to Delphi, copies of which are attached hereto as Schedules G
and H, which relate to the extension of eligibility for Delphi employees to
participate in the GM Vehicle Purchase Programs.
SECTION 2.02. Assumption of Liabilities.
(a) General. Effective as of the Contribution Date, each of Delphi
and/or the Delphi U.S. Subsidiaries, as directed by Delphi, hereby assumes and
on a timely basis shall pay, perform, satisfy and discharge in accordance with
their terms the Delphi Liabilities relating to the operations of the Delphi
Automotive Systems Business in the United States. Delphi International
Subsidiary shall, and shall utilize its best efforts to recommend and encourage
its respective Subsidiaries and Affiliates to, assume and on a timely basis pay,
perform, satisfy and discharge in accordance with their terms, the Delphi
Liabilities relating to the operations of the Delphi Automotive Systems Business
outside of the United States.
(b) Divested Business. Delphi shall, with respect to the businesses and
operations divested by the Delphi Automotive Systems Business, assume all
Liabilities of GM related thereto; provided, however, that Delphi shall not
assume those Liabilities relating to operations divested by the Delphi
Automotive Systems Business to the extent such Liabilities are expressly
retained by GM pursuant to the terms of this Agreement or the Ancillary
Agreements (including without limitation, the Employee Matters Agreement, the
Environmental Matters Agreement and the Real Estate Matters Agreement) and the
Liabilities assumed by Delphi shall include, without limitation, the obligation
to satisfy all of the obligations of GM under the various agreements pursuant to
which the Delphi Automotive Systems Business effected such divestitures (the
"Divestiture Agreements"); provided, further, however, that notwithstanding the
foregoing or any other provision of this Agreement or any Ancillary Agreement,
responsibility for certain obligations relating to certain divestitures shall be
allocated between the parties as set forth on Schedule I hereto.
(c) Machinery and Equipment Leases Related to the Delphi Automotive
Systems Business. The parties hereto hereby agree that to the extent that GM
entered into a lease with a third party dated prior to the Contribution Date
pursuant to which GM agreed to lease (i) machinery and/or equipment for use by
the Delphi Automotive Systems Business and (ii) machinery and/or equipment for
use by GM businesses other than the Delphi Automotive Systems Business, upon
identification of any such lease, GM and Delphi will enter into a sublease with
terms identical or as similar as possible to such original lease pursuant to
which Delphi will sublease from GM that portion of the machinery and/or
equipment used by the Delphi Automotive Systems Business covered under such
original lease.
(d) Nonrecurring Costs and Expenses. Notwithstanding anything herein to
the contrary, any nonrecurring costs and expenses incurred by the parties hereto
to effect the transactions contemplated hereby which are not allocated pursuant
to the terms of this Agreement or any Ancillary Agreement shall be the
responsibility of the party which incurs such costs and expenses.
SECTION 2.03. Methods of Transfer and Assumption.
(a) The parties shall enter into the Ancillary Agreements, other than
the IPO and Distribution Agreement and the Registration Rights Agreement, on or
about the date of this Agreement. To the extent that the transfer of any Delphi
Asset or the assumption of any Delphi Liability is expressly provided for by the
terms of any Ancillary Agreement, the terms of such Ancillary Agreement shall
determine the manner of the transfer or assumption. It is the intent of the
parties that pursuant to Section 2.01, the transfer and assumption of all other
Delphi Assets and Delphi Liabilities shall be made effective as of the
Contribution Date, provided, however, that circumstances in various
jurisdictions outside the United States may require the transfer of certain
Assets and the assumption of certain Liabilities to occur in such other manner
and at such other time as the parties shall agree.
(b) The parties intend to complete the transfer of all Delphi Assets
and the assumption of all Delphi Liabilities effective on or prior to the
Contribution Date but shall, subject to Section 4.03 hereof, and to the extent
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that any such transfers and assumptions are not completed prior to the
Contribution Date, take all actions reasonably necessary or appropriate to
complete such transactions as promptly thereafter as possible. In addition to
those transfers and assumptions accurately identified and designated by the
parties to take place but which the parties are not able to effect prior to the
Contribution Date, there may exist (i) Assets that the parties discover were,
contrary to the agreements between the parties, by mistake or omission,
transferred to Delphi or retained by GM or (ii) Liabilities that the parties
discover were, contrary to the agreements between the parties, by mistake or
omission, assumed by Delphi or not assumed by Delphi. The parties shall, between
the Contribution Date and the earlier of the Distribution Date or six months
from the Contribution Date, cooperate in good faith to effect the transfer or
re-transfer of such Assets, and/or the assumption or re-assumption of such
Liabilities, to or by the appropriate party and shall not use the determination
of remedial actions contemplated herein to alter the original intent of the
parties hereto with respect to the Assets to be transferred to or Liabilities to
be assumed by Delphi. Each party shall reimburse the other or make other
financial adjustments (e.g., without limitation, cash reserves) or other
adjustments to remedy any mistakes or omissions relating to any of the Assets
transferred hereby or any of the Liabilities assumed hereby.
(c) Each party shall execute and deliver to each other party all such
documents, instruments, certificates and agreements in appropriate form, and to
make all filings and recordings and to take all such other actions, as shall be
necessary or reasonably requested by such other party, whether before or after
the Contribution Date, in order to give full effect to and evidence and perfect
the transfer and contribution of the Delphi Assets and the Delphi Liabilities as
contemplated hereby. However, Delphi acknowledges and agrees that neither GM nor
any Subsidiary of GM will comply with the provisions of any bulk transfer law of
any jurisdiction in connection with the transfer of any Delphi Asset.
(d) Any Subsidiary of Delphi that will receive any Delphi Asset or
assume any Delphi Liability shall for all purposes be deemed to be a party to
this Agreement.
SECTION 2.04. Nonassignable Contracts. Anything contained herein to the
contrary notwithstanding, this Agreement shall not constitute an agreement to
assign any Asset or Liability if an assignment or attempted assignment of the
same without the consent of another Person would constitute a breach thereof or
in any way impair the rights of a party thereunder or give to any third party
any rights with respect thereto. If any such consent is not obtained or if an
attempted assignment would be ineffective or would impair such party's rights
under any such Asset or Liability so that the party entitled to the benefits and
responsibilities of such purported transfer (the "Intended Transferee") would
not receive all such rights and responsibilities, then (x) the party purporting
to make such transfer (the "Intended Transferor") shall use commercially
reasonable efforts to provide or cause to be provided to the Intended
Transferee, to the extent permitted by law, the benefits of any such Asset or
Liability and the Intended Transferor shall promptly pay or cause to be paid to
the Intended Transferee when received all moneys received by the Intended
Transferor with respect to any such Asset and (y) in consideration thereof the
Intended Transferee shall pay, perform and discharge on behalf of the Intended
Transferor all of the Intended Transferor's Liabilities thereunder in a timely
manner and in accordance with the terms thereof which it may do without breach.
In addition, the Intended Transferor shall take such other actions as may
reasonably be requested by the Intended Transferee in order to place the
Intended Transferee, insofar as reasonably possible, in the same position as if
such Asset had been transferred as contemplated hereby and so all the benefits
and burdens relating thereto, including possession, use, risk of loss, potential
for gain and dominion, control and command, shall inure to the Intended
Transferee. If and when such consents and approvals are obtained, the transfer
of the applicable Asset shall be effected in accordance with the terms of this
Agreement. To the extent that the Delphi Liabilities include liabilities,
obligations or commitments pursuant to any contract, permit, license, franchise
or other Asset to which Delphi also has any rights, GM shall, to the extent such
asset is not a Delphi Asset, upon request by Delphi either assign such rights to
Delphi or assert and seek to enforce such rights for the benefit of Delphi.
SECTION 2.05. Transition Services.
(a) For a period of twelve months following the Contribution Date
(the "Transition Period"), GM shall use its reasonable best efforts to provide,
or cause its Affiliates to use their reasonable best efforts to provide,
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to Delphi or its Affiliates all Transition Services in the manner and at a
relative level of service consistent in all material respects with that provided
by GM or its Affiliates to the Delphi Automotive Systems Business immediately
prior to the Contribution Date. Delphi shall use all commercially reasonable
efforts to obtain all such Transition Services from a source other than GM and
its Affiliates commencing upon the conclusion of the Transition Period; provided
that, if (x) Delphi cannot obtain any Transition Service from a source other
than GM and its Affiliates and (y) such Transition Service is necessary in order
to operate the Delphi Automotive Systems Business in substantially the same
manner as it was conducted immediately prior to the Contribution Date, then GM
(or its Affiliates) shall provide such Transition Service to Delphi (or its
Affiliates) for an additional period not to exceed six months. For the purpose
of this Section 2.05, "Transition Services" means any services provided by GM,
its Affiliates or their suppliers to the Delphi Automotive Systems Business
immediately prior to the Contribution Date which Delphi reasonably identifies
and requests in writing that GM provide to it during the Transition Period;
provided that Transition Services expressly excludes any such services which
shall be provided to Delphi or its Affiliates pursuant to the terms of other
sections of this Agreement or any of the Ancillary Agreements; provided,
further, that Transition Services expressly excludes any such services which GM
would not be legally permitted to provide to a third party.
(b) Notwithstanding anything contained in this Agreement or in any
Ancillary Agreement to the contrary, except with respect to all services to be
provided by GM to Delphi pursuant to the Financial Services Supply Agreement,
the Commercial Travel Services Supply Agreement, any real estate leases and any
health care services to be provided by GM to Delphi pursuant to the Employee
Matters Agreement, for all Transition Services provided by GM (or its
Affiliates) to Delphi (or its Affiliates) pursuant to section 2.05(a) above and
for all other services to be provided by GM (or its Affiliates) to Delphi (or
its Affiliates) pursuant to any of the Ancillary Agreements, Delphi shall pay to
GM on or prior to the fifteenth day following the date of Delphi's receipt of an
invoice related to the provision of such services (x) in the case of any
Transition Service or any service to be provided pursuant to an Ancillary
Agreement in which a payment amount or formula has not been set forth, an amount
equal to the cost historically allocated to the Delphi Automotive Systems
Business as of the Contribution Date for such service, adjusted to reflect any
changes in the nature, cost or level of the services provided; provided that, if
no cost has historically been allocated to the Delphi Automotive Systems
Business for any Transition Service or for such other service, then Delphi shall
pay to GM (i) that portion of the total cost borne by GM which GM would have
allocated to Delphi under its internal allocation formula, plus (ii) any direct
user charges or similar type charges resulting from Delphi's use or services
which are not recouped by GM under the charges provided for in (i), plus (iii)
any other reasonable charges necessary to make GM whole for the provision of
such services or (y) in the case of any service to be provided pursuant to an
Ancillary Agreement in which a payment amount or formula has been set forth, the
amount owed pursuant to the terms of such Ancillary Agreement. Payments under
this Section made on or after the first business day following the forty-fifth
day after the date of Delphi's receipt of the invoice related to the provision
of the relevant service shall be accompanied by a payment of interest to be
calculated as follows:
Transitional Service (or other service) Payment x Prime Rate x Number of days late, to
---------- the date of actual
365 days payment.
As used in this Section 2.05(b), the "Prime Rate" shall mean to the prime rate
as published in the Wall Street Journal on the first business day following the
forty-fifth day after the date of Delphi's receipt of the invoice related to the
provision of the relevant service.
(c) Notwithstanding anything contained in this Agreement or in any
Ancillary Agreement to the contrary, any charges to GM from outside suppliers
for the provision of Transition Services or any other services provided pursuant
to any Ancillary Agreement and any other costs which are attributable to the
operation of Delphi other than incidental costs provided in connection with
Transition Services or such other services which GM (or an Affiliate of GM)
incurs shall be submitted by GM to Delphi for payment and, except as GM may
otherwise agree in connection with any individual statement of charges which has
been submitted to GM, Delphi hereby agrees to make payment therefor either (i)
to such outside supplier in accordance with the payment terms of such outside
supplier or (ii) where GM is required to pay such outside supplier, on or before
the date on which GM notifies
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Delphi it intends to make payment, or if GM does not provide such notice,
immediately after GM provides notice to Delphi that GM has made such payment.
(d) Notwithstanding anything to the contrary herein, Delphi shall be
responsible for providing the transitional services agreed to by the parties
(or, where no specific terms have been agreed to, then in accordance with the
terms of Section 2.05(b) hereof) with respect to the businesses set forth on
Schedule J hereto.
ARTICLE 3
ANCILLARY AGREEMENTS
(a) General. GM and Delphi acknowledge that the Ancillary Agreements,
other than the IPO and Distribution Agreement and the Registration Rights
Agreement, have been or will be entered into prior to the Contribution Date by
the parties hereto and/or by their respective Subsidiaries. GM and Delphi shall
take all steps reasonably necessary to cause their respective Subsidiaries and
Affiliates to enter into and perform such Ancillary Agreements in accordance
with their terms.
(b) Priority. Except with respect to Sections 2.05 (b) and (c) above,
to the extent that any Ancillary Agreement expressly addresses any matters
addressed by this Agreement, including, without limitation, matters covered by
Article 2 and Article 5 hereof, the terms and conditions of such Ancillary
Agreement shall govern the rights and obligations of the parties with respect to
such matters.
(c) Extensions of Transition Services. Delphi shall use all
commercially reasonable efforts to obtain services provided to it by GM under
the terms of the Ancillary Agreements relating to transitional services from a
source other than GM. Certain Ancillary Agreements relating to transitional
services provide that the parties may extend the transition service beyond the
termination of the transition periods provided for therein. The parties expect
that any such extension would be negotiated by GM and Delphi after the
Distribution. In the event of an extension of any transitional service, GM and
Delphi shall negotiate at arm's length the terms of any such extension,
including fair market value pricing for all such services.
ARTICLE 4
COVENANTS
SECTION 4.01. IPO and Distribution Agreement. GM and Delphi hereby
agree to execute and deliver, on or before the IPO Effective Date, the IPO and
Distribution Agreement, in form and substance substantially as set forth on
Exhibit E-1 hereto, with such modifications to such form as the parties shall
mutually deem reasonably necessary and desirable; provided, that GM shall be
entitled in its sole and absolute discretion at any time and from time to time
to make any modifications to the provisions thereof relating to the preservation
of the tax-free nature of the Distribution or the tax-free nature of the
transactions contemplated hereby as it shall reasonably deem necessary or
desirable.
SECTION 4.02. Registration Rights Agreement. GM and Delphi hereby agree
to execute and deliver, on or before the IPO Effective Date, the Registration
Rights Agreement, in form and substance substantially as set forth on Exhibit
E-2 hereto, with such modifications to such form as the parties shall mutually
deem reasonably necessary and desirable.
SECTION 4.03. Delayed Asset Transfers. GM and Delphi hereby agree to
use their best efforts and, where applicable, to cause their subsidiaries to use
their best efforts to consummate the transactions contemplated by
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Section 2.01(c) hereof and the other provisions hereof as and when contemplated
in the relevant Ancillary Agreements.
ARTICLE 5
INDEMNIFICATION
SECTION 5.01. Indemnification by Delphi. Delphi and each Subsidiary of
Delphi which shall receive any Delphi Asset or Delphi Liability transferred
pursuant to the terms of this Agreement and their respective
successors-in-interest and assigns (the "Indemnifying Parties") shall jointly
and severally indemnify, defend and hold harmless GM and each of its
Subsidiaries and their respective successors-in-interest, and each of their
respective past and present Representatives (the "Indemnitees") against any
losses, claims, damages, liabilities or actions, resulting from, relating to or
arising, whether prior to or following the Contribution Date, out of or in
connection with (a) the Delphi Liabilities and/or (b) Delphi's conduct of its
business and affairs after the Contribution Date and the Indemnifying Parties
shall reimburse such entity, each such Subsidiary, each such
successor-in-interest and each such Representative for any reasonable attorneys'
fees or any other expenses reasonably incurred by any of them in connection with
investigating and/or defending any such loss, claim, damage, liability or
action.
SECTION 5.02. Indemnification Procedures.
(a) If any Indemnitee receives notice of the assertion of any
Third-Party Claim with respect to which an Indemnifying Party is obligated under
this Agreement to provide indemnification, such Indemnitee shall promptly give
such Indemnifying Party notice thereof (together with a copy of such Third-Party
Claim, process or other legal pleading) promptly after becoming aware of such
Third-Party Claim; provided, however, that the failure of any Indemnitee to give
notice as provided in this Section 5.02 shall not relieve any Indemnifying Party
of its obligations under this Section 5.02, except to the extent that such
Indemnifying Party is actually prejudiced by such failure to give notice. Such
notice shall describe such Third-Party Claim in reasonable detail.
(b) An Indemnifying Party, at such Indemnifying Party's own expense
and through counsel chosen by such Indemnifying Party (which counsel shall be
reasonably acceptable to the Indemnitee), may elect to defend any Third-Party
Claim. If an Indemnifying Party elects to defend a Third-Party Claim, then,
within ten Business Days after receiving notice of such Third-Party Claim (or
sooner, if the nature of such Third Party claim so requires), such Indemnifying
Party shall notify the Indemnitee of its intent to do so, and such Indemnitee
shall cooperate in the defense of such Third-Party Claim. Such Indemnifying
Party shall pay such Indemnitee's reasonable out-of-pocket expenses incurred in
connection with such cooperation. Such Indemnifying Party shall keep the
Indemnitee reasonably informed as to the status of the defense of such
Third-Party Claim. After notice from an Indemnifying Party to an Indemnitee of
its election to assume the defense of a Third-Party Claim, such Indemnifying
Party shall not be liable to such Indemnitee under this Section 5.02 for any
attorneys' fees or other expenses subsequently incurred by such Indemnitee in
connection with the defense thereof other than those expenses referred to in the
preceding sentence; provided, however, that such Indemnitee shall have the right
to employ one law firm as counsel, together with a separate local law firm in
each applicable jurisdiction ("Separate Counsel"), to represent such Indemnitee
in any action or group of related actions (which firm or firms shall be
reasonably acceptable to the Indemnifying Party) if, in such Indemnitee's
reasonable judgment at any time, either a conflict of interest between such
Indemnitee and such Indemnifying Party exists in respect of such claim, or there
may be defenses available to such Indemnitee which are significantly different
from or in addition to those available to such Indemnifying Party and the
representation of both parties by the same counsel would, in the reasonable
judgment of the Indemnitee, be inappropriate, and in that event (i) the
reasonable fees and expenses of such Separate Counsel shall be paid by such
Indemnifying Party (it being understood, however, that the Indemnifying Party
shall not be liable for the expenses of more than one Separate Counsel
(excluding local counsel) with respect to any Third-Party Claim (even if against
multiple Indemnitees)) and (ii) each of such Indemnifying Party and such
Indemnitee shall have the right to conduct its own defense in respect of such
claim. If an Indemnifying Party elects not to defend against a Third-Party
Claim, or fails to notify an Indemnitee of its election as provided in this
Section 5.02 within the period of ten Business
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Days described above, the Indemnitee may defend, compromise, and settle such
Third-Party Claim and shall be entitled to indemnification hereunder (to the
extent permitted hereunder); provided, however, that no such Indemnitee may
compromise or settle any such Third-Party claim without the prior written
consent of the Indemnifying Party, which consent shall not be unreasonably
withheld or delayed. Notwithstanding the foregoing, the Indemnifying Party shall
not, without the prior written consent of the Indemnitee, (i) settle or
compromise any Third-Party Claim or consent to the entry of any judgment which
does not include as an unconditional term thereof the delivery by the claimant
or plaintiff to the Indemnitee of a written release from all liability in
respect of such Third-Party Claim or (ii) settle or compromise any Third-Party
Claim in any manner that would be reasonably likely to have a material adverse
effect on the Indemnitee.
SECTION 5.03. Certain Limitations.
(a) The amount of any indemnifiable losses or other liability for
which indemnification is provided under this Agreement shall be net of any
amounts actually recovered by the Indemnitee from third parties (including,
without limitation, amounts actually recovered under insurance policies) with
respect to such indemnifiable losses or other liability. Any Indemnifying Party
hereunder shall be subrogated to the rights of the Indemnitee upon payment in
full of the amount of the relevant indemnifiable loss. An insurer who would
otherwise be obligated to pay any claim shall not be relieved of the
responsibility with respect thereto or, solely by virtue of the indemnification
provision hereof, have any subrogation rights with respect thereto. If any
Indemnitee recovers an amount from a third party in respect of an indemnifiable
loss for which indemnification is provided in this Agreement after the full
amount of such indemnifiable loss has been paid by an Indemnifying Party or
after an Indemnifying Party has made a partial payment of such indemnifiable
loss and the amount received from the third party exceeds the remaining unpaid
balance of such indemnifiable loss, then the Indemnitee shall promptly remit to
the Indemnifying Party the excess (if any) of (A) the sum of the amount
theretofore paid by such Indemnifying Party in respect of such indemnifiable
loss plus the amount received from the third party in respect thereof, less (B)
the full amount of such indemnifiable loss or other liability.
(b) The amount of any loss or other liability for which
indemnification is provided under this Agreement shall be (i) increased to take
account of any net tax cost incurred by the Indemnitee arising from the receipt
or accrual of an indemnification payment hereunder (grossed up for such
increase) and (ii) reduced to take account of any net tax benefit realized by
the Indemnitee arising from incurring or paying such loss or other liability. In
computing the amount of any such tax cost or tax benefit, the Indemnitee shall
be deemed to recognize all other items of income, gain, loss, deduction or
credit before recognizing any item arising from the receipt or accrual of any
indemnification payment hereunder or incurring or paying any indemnified loss.
Any indemnification payment hereunder shall initially be made without regard to
this Section 5.03(b) and shall be increased or reduced to reflect any such net
tax cost (including gross-up) or net tax benefit only after the Indemnitee has
actually realized such cost or benefit. For purposes of this Agreement, an
Indemnitee shall be deemed to have "actually realized" a net tax cost or a net
tax benefit to the extent that, and at such time as, the amount of taxes payable
by such Indemnitee is increased above or reduced below, as the case may be, the
amount of taxes that such Indemnitee would be required to pay but for the
receipt or accrual of the indemnification payment or the incurrence or payment
of such loss, as the case may be. The amount of any increase or reduction
hereunder shall be adjusted to reflect any Final Determination with respect to
the Indemnitee's liability for taxes, and payments between such indemnified
parties to reflect such adjustment shall be made if necessary.
(c) Any indemnification payment made under this Agreement shall be
characterized for tax purposes as if such payment were made immediately prior to
the Contribution Date.
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ARTICLE 6
ACCESS TO INFORMATION
SECTION 6.01 Restrictions on Disclosure of Information.
(a) Without limiting any rights or obligations under any other
agreement between or among the parties hereto and/or any of their respective
Affiliates relating to confidentiality, for a period of three years following
the Contribution Date, each of the parties hereto agrees that it shall not, and
shall not permit any of its Affiliates or Representatives to, disclose any
Confidential Information to any Person, other than to such Affiliates or
Representatives on a need-to-know basis in connection with the purpose for which
the Confidential Information was originally disclosed. Notwithstanding the
foregoing, each of the parties hereto and its respective Affiliates and
Representatives may disclose such Confidential Information, and such Information
shall no longer be deemed Confidential Information, to the extent that such
party can demonstrate that such Confidential Information is or was (i) available
to such party outside the context of the Prior Relationship on a nonconfidential
basis prior to its disclosure by the other party, (ii) in the public domain
other than by the breach of this Agreement or by breach of any other agreement
between or among the parties hereto and/or any of their respective Affiliates
relating to confidentiality, or (iii) lawfully acquired outside the context of
the Prior Relationship on a nonconfidential basis or independently developed by,
or on behalf of, such party by Persons who do not have access to, or
descriptions of, any such Confidential Information. Additionally,
notwithstanding anything to the contrary herein, any Information provided by GM
to Delphi or by Delphi to GM shall, except as hereafter agreed to in writing by
the parties, not be deemed Confidential Information with respect to the use of
such Information by Delphi in the ordinary course of Delphi's business or by GM
in the ordinary course of GM's business, respectively.
(b) Each of the parties hereto shall maintain, and shall cause their
respective Affiliates to maintain, policies and procedures, and develop such
further policies and procedures as shall from time to time become necessary or
appropriate, to ensure compliance with this Section 6.01.
SECTION 6.02. Legally Required Disclosure of Confidential Information.
If any of the parties to this Agreement or any of their respective Affiliates or
Representatives becomes legally required to disclose any Confidential
Information, such disclosing party shall promptly notify the party owning the
Confidential Information (the "Owning Party") and shall use all commercially
reasonable efforts to cooperate with the Owning Party so that the Owning Party
may seek a protective order or other appropriate remedy and/or waive compliance
with this Section 6.02. All expenses reasonably incurred by the disclosing party
in seeking a protective order or other remedy shall be borne by the Owning
Party. If such protective order or other remedy is not obtained, or if the
Owning Party waives compliance with this Section 6.02, the disclosing party or
its Affiliate or Representative, as applicable, shall (a) disclose only that
portion of the Confidential Information which its legal counsel advises it is
compelled to disclose or else stand liable for contempt or suffer other similar
significant corporate censure or penalty, (b) use all commercially reasonable
efforts to obtain reliable assurance requested by the Owning Party that
confidential treatment will be accorded such Confidential Information, and (c)
promptly provide the Owning Party with a copy of the Confidential Information so
disclosed, in the same form and format so disclosed, together with a description
of all Persons to whom such Confidential Information was disclosed.
SECTION 6.03. Access to Information. During the Retention Period (as
defined in Section 6.04 below), each of the parties hereto shall cooperate with
and afford, and shall cause their respective Affiliates, Representatives,
Subsidiaries, successors and/or assignees, and shall use reasonable efforts to
cause joint ventures that are not Affiliates (collectively, "Related Parties")
to cooperate with and afford, to the other party reasonable access upon
reasonable advance written request to all information (other than information
which is (i) protected from disclosure by the attorney client privilege or work
product doctrine, (ii) proprietary in nature or (iii) the subject of a
confidentiality agreement between such party and a third party which prohibits
disclosure to the other party) within such party's or any Related Party's
possession which was created prior to the Contribution Date or, with
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respect to any information which would be relevant to the provision of a
transitional service pursuant to this Agreement or any Ancillary Agreement,
information created during the period in which one party is providing the other
party with such transition service. Access to the requested information shall be
provided so long as it relates to the requesting party's (the "Requestor")
business, assets or liabilities, and access is reasonably required by the
Requestor as a result of the parties' Prior Relationship for purposes of
auditing, accounting, claims or litigation (except for claims or litigation
between the parties hereto), employee benefits, regulatory or tax purposes or
fulfilling disclosure or reporting obligations including, without limitation,
Information reasonably necessary for the preparation of reports required by or
filed under the Securities Exchange Act of 1934, as amended, with respect to any
period entirely or partially prior to the Contribution Date.
Access as used in this paragraph shall mean the obligation of a party
in possession of Information (the "Possessor") requested by the Requestor to
exert its reasonable best efforts to locate all requested Information that is
owned and possessed by Possessor or any Related Party. The Possessor, at its own
expense, shall conduct a diligent search designed to identify all requested
Information and shall collect all such Information for inspection by the
Requestor during normal business hours at the Possessor's place of business.
Subject to confidentiality and/or security provisions as the Possessor may
reasonably deem necessary, the Requestor may have all requested Information
duplicated at Requestor's expense. Alternatively, the Possessor may choose to
deliver, at its own expense, all requested Information to the Requestor in the
form it was requested by the Requestor. If so, the Possessor shall notify the
Requestor in writing at the time of delivery if such Information is to be
returned to the Possessor. In such case, the Requestor shall return such
Information when no longer needed to the Possessor at the Possessor's expense.
In connection with providing Information pursuant to this Section 6.03,
each of the parties hereto shall upon the request of the other party make
available its respective employees (and those of their respective Related
Parties, as applicable) to the extent that they are reasonably necessary to
discuss and explain all requested Information with and to the requesting party.
SECTION 6.04. Record Retention.
(a) Books and Records. Delphi shall preserve and keep all books and
records included in the Delphi Assets or otherwise in the possession of Delphi
or its Related Parties, whether in electronic form or otherwise, for no less
than ten years from the Contribution Date, or for any longer period as may be
required by any government agency, GM's record retention schedule effective as
of the Contribution Date or as GM may subsequently notify Delphi that such
schedule has been modified, litigation (including applicable "Litigation
Holds"), law, regulation, audit or appeal of taxes, tax examination or the
expiration of the periods described in Section 6.04 (c), where applicable (the
"Retention Period") at Delphi's sole cost and expense. If Delphi wishes to
dispose of any books and records or other documents which it is obligated to
retain under this Section 6.04 after the Retention Period, then Delphi shall
first provide 90 days' written notice to GM and GM shall have the right, at its
option and expense, upon prior written notice within such 90-day period, to take
possession of such books or records or other documents within 180 days after the
date of Delphi's notice to GM hereunder. Written notice of intent to dispose of
such books and records shall include a description of the books and records in
detail sufficient to allow GM to reasonably assess its potential need to retain
such materials. In the event Delphi enters into an agreement with a third party
to sell a portion of its business, together with the books and records related
thereto, GM shall have the right to duplicate such books and records prior to
any such disposition and, should the purchaser of the Delphi business be a
competitor of GM, GM shall have the right to prohibit the transfer or disclosure
to such party of that portion of the former books and records of GM which GM
notifies Delphi contain confidential and proprietary information. To the extent
that books and records of GM or any of its Affiliates which contain information
relating to the Delphi Automotive Systems Business are not included in the
Delphi Assets, GM agrees to cooperate with Delphi in providing Delphi with any
such information upon Delphi's reasonable request to the extent that any such
information exists and is reasonably separable from GM information unrelated to
the Delphi Automotive Systems Business. Delphi shall reimburse GM for all of its
reasonable out-of-pocket costs incurred in connection with any such request.
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(b) Technical Documentation and Personnel. In addition to the
retention requirements of Section 6.04(a), for a period no less than the
Retention Period, Delphi, at its sole cost and expense, shall use its reasonable
best efforts to maintain all technical documentation in its possession or in the
possession of any of its Related Parties applicable to product design, test,
release, and validation at locations at which such technical documents shall be
reasonably accessible to GM upon request (at GM's sole cost and expense) and, to
the extent reasonably possible, through employees of Delphi who formerly
performed that task for GM. In addition to the obligations set forth in Section
6.05 hereof, Delphi shall, from time to time, at the reasonable request of GM,
cooperate fully with GM in providing GM, to the extent reasonably possible
through Delphi employees formerly employed by GM who previously performed the
same functions on behalf of GM, with technical assistance and information in
respect to any claims brought against GM involving the conduct of the Delphi
Automotive Systems Business prior to the Contribution Date, including
consultation and/or the appearance(s) of such persons on a reasonable basis as
expert or fact witnesses in trials or administrative proceedings. GM shall
reimburse Delphi for its reasonable out-of-pocket costs (travel, hotels, etc.)
of providing such services, consistent with GM's policies and practices
regarding such expenditures. Additionally, GM shall, from time to time, at the
reasonable request of Delphi, cooperate fully with Delphi in providing Delphi,
to the extent reasonably possible through applicable GM employees, with
technical assistance and information in respect to any claims brought against
Delphi involving the conduct of the Delphi Automotive Systems Business prior to
the Contribution Date, including consultation and/or the appearance(s) of such
persons on a reasonable basis as expert or fact witnesses in trials or
administrative proceedings. Delphi shall reimburse GM for its reasonable
out-of-pocket costs (travel, hotels, etc.) of providing such services,
consistent with Delphi's policies and practices regarding such expenditures.
In particular, Delphi shall: (i) retain all documents required to be
maintained by international, national, state, provincial, regional or local
regulations and all documents that may be reasonably required to establish due
care or to otherwise assist GM in pursuing, contesting or defending such claims;
(ii) make available its documents and records in connection with any pursuit,
contest or defense, including, subject to an appropriate confidentiality
agreement or protective order, documents that may be considered to be
"confidential" or subject to trade secret protection ; (iii) promptly respond to
discovery requests in connection with such claim, understanding and
acknowledging that the requirements of discovery in connection with litigation
require timely responses to interrogatories, requests to produce, requests for
admission and depositions and also understanding and acknowledging that any
delays in connection with responses to discovery may result in sanctions; (iv)
make available, as may be reasonably necessary and upon reasonable advance
notice and for reasonable periods so as not to interfere materially with
Delphi's business, mutually acceptable engineers, technicians or other
knowledgeable individuals to assist GM in connection with such claim, including
investigation into claims and occurrences described in this section and
preparing for and giving factual and expert testimony at depositions, court
proceedings, inquiries, hearings and trial; (v) make available facilities and
exemplar parts for the sole and limited use of assisting GM in the contest or
defense; and (vi) acknowledge that GM is responsible for and will control, as
between GM and Delphi, the conduct of the pursuit, contest or defense.
(c) Tax Related Records. GM and Delphi agree to retain all Income Tax
Returns, related schedules and workpapers, and all material records and other
documents as required under Section 6001 of the Code, as well as by any similar
provision of state or local income tax law, until the later of (i) the
expiration of the applicable statute of limitations for the tax period to which
the records relate, or (ii) the Final Determination has been made with respect
to all issues related to the final Consolidated Tax Period.
With respect to Non-Income Taxes, GM and Delphi agree to retain all
Non-Income Tax Returns, related schedules and workpapers, and all material
records and other documents as required under Federal, state or local law, until
the later of (i) the expiration of the applicable statute of limitations for the
tax period to which the records relate, or (ii) a Determination has been made
with respect to all issues for the tax periods to which XXXX applies.
If either party wishes to dispose of any such records or documents
after such retention period, then the procedure described in (a) above shall
apply.
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SECTION 6.05. Production of Witnesses. Until the six-year anniversary
of the Contribution Date, each of the parties hereto shall use all commercially
reasonable efforts, and shall cause each of their respective Affiliates to use
all commercially reasonable efforts, to make available to each other, upon
written request, its directors, officers, employees and other Representatives as
witnesses to the extent that any such Person may reasonably be required (giving
consideration to the business demands upon such Persons) in connection with any
legal, administrative or other proceedings in which the requesting party may
from time to time be involved; provided, however, that with respect to any legal
or administrative proceedings relating to the tax liability of any of the
parties hereto or any of their respective Affiliates, each of the parties hereto
shall, and shall cause each of their respective Affiliates to, make their
directors, officers, employees and other Representatives available as witnesses
until such time as the statute of limitations have expired with respect to all
tax years prior to and including the year in which the asset transfers
contemplated by this Agreement are consummated.
SECTION 6.06. Reimbursement. Unless otherwise provided in this Article
6, each party to this Agreement providing access, information or witnesses to
another party pursuant to Sections 6.03, 6.04 or 6.05 shall be entitled to
receive from the recipient, upon the presentation of invoices therefor, payment
for all reasonable out-of-pocket costs and expenses (excluding allocated
compensation, salary and overhead expense) as may be reasonably incurred in
providing such information or witnesses.
ARTICLE 7
CERTAIN CLAIMS AND LITIGATION
Section 7.01. Product Liability Claims.
(a) Applicability. GM and Delphi agree to the allocation of liability
for all claims and causes of action, however presented, alleging that parts,
components or systems that have been (i) manufactured by the Delphi Automotive
Systems Business or Delphi or its Affiliates, or (ii) manufactured by a third
party, whether sold or otherwise supplied separately, or incorporated into
components or systems of Delphi or its Affiliates, in each case, which have been
sold or otherwise supplied by the Delphi Automotive Systems Business, Delphi or
its Affiliates to GM, its Affiliates or customers of Delphi other than GM or its
Affiliates (the foregoing collectively constituting "Delphi Products") have
caused or been alleged to cause personal inuries, injuries to property or other
damages as set forth in this Section 7.01. The provisions in this Section 7.01
cover claims which include but are not limited to the following types of claims:
claims premised on theories of negligence, strict liability, express or implied
warranties of merchantability, fitness for ordinary use and/or compliance with
reasonable consumer expectations, failure to issue adequate warnings, negligent
and/or intentional misrepresentation, negligent and/or intentional infliction of
emotional distress, failure to provide replacement and/or retrofit parts, and
failure to conduct a recall or adequately conduct a recall that has been issued.
The provisions set forth in this Section 7.01 apply to claims for compensatory
damages as well as all claims for punitive or exemplary damages and all claims
for defective design as well as all claims for defective manufacture.
(b) Parts Components or Systems Manufactured by the Delphi
Automotive Systems Business Prior to January 1, 1999.
(i) As between GM and Delphi, Delphi shall assume the defense
of all such claims involving Delphi Products sold or otherwise supplied
prior to January 1, 1999 to customers other than GM or an Affiliate or
Subsidiary of GM. Delphi shall indemnify, defend and hold harmless GM
and its Affiliates against any and all such claims. Delphi shall
reimburse GM and its Affiliates for any reasonable attorneys' fees or
other expenses reasonably incurred by GM subsequent to December 31,
1998 in connection with investigating and/or defending against any such
claim.
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(ii) GM shall retain and/or assume the defense of all such
claims involving parts, components or systems manufactured by the
Delphi Automotive Systems Business prior to January 1, 1999 and sold or
otherwise supplied to GM or its Affiliates before, on, or after January
1, 1999. GM shall indemnify, defend and hold harmless Delphi and its
Affiliates against any and all such claims. GM shall reimburse Delphi
and its Affiliates for any reasonable attorneys' fees or other expenses
reasonably incurred by Delphi or its Affiliates subsequent to December
31, 1998 in connection with investigating and/or defending any such
claim or securing the indemnification and/or defense that GM is
required to provide pursuant to this paragraph.
(c) Parts, Components or Systems Manufactured, Sold or otherwise
Supplied by Delphi on or Subsequent to January 1, 1999.
(i) Delphi shall defend GM and its Affiliates against all
claims involving (A) parts, components or systems manufactured by
Delphi or its Affiliates which on or subsequent to January 1, 1999 are
sold or otherwise supplied to customers other than GM or its
Affiliates; and (B) parts, components or systems acquired by the Delphi
Automotive Systems Business or Delphi or its Affiliates from suppliers
thereto other than GM or its Affiliates and sold or otherwise supplied
by Delphi or its Affiliates on or subsequent to January 1, 1999 to
customers other than GM or its Affiliates. Delphi or its Affiliates
shall indemnify, defend and hold harmless GM and its Affiliates against
any and all such claims. Delphi or its Affiliates shall reimburse GM
and its Affiliates for any reasonable attorneys' fees or other expenses
reasonably incurred by GM and its Affiliates in connection with
investigating and/or defending any such claim or securing the
indemnification and/or defense that Delphi and its Affiliates are
required to provide pursuant to this paragraph.
(ii) The rights, obligations and liabilities of GM and Delphi
with respect to claims involving parts, components or systems
manufactured by Delphi or its affiliates subsequent to December 31,
1998 which are sold by Delphi or its Affiliates to GM or its Affiliates
shall be determined according to the terms of the agreements relating
to such sale.
(d) Recall and Warranty Campaigns. Claims of GM or its Affiliates
against the Delphi Automotive Systems Business in the nature of warranty and
recall campaigns relating to parts, components or systems sold by the Delphi
Automotive Systems Business to GM or its Affiliates (regardless of when or by
whom manufactured (but excluding parts or systems manufactured by GM or its
Affiliates)) which arise prior to or after the Contribution Date shall be
determined according to the terms of the agreements relating to the sale of such
parts, components or systems, all of which agreements are assumed by Delphi and
its Affiliates pursuant to the terms of the Supply Agreement.
(e) Notice. GM and Delphi agree that in the case of claims covered by
either paragraphs (b) or (c) above, the party receiving such a claim will notify
the other party within 30 days of receipt of written notice of the claim.
Thereafter, the party being notified of the claim shall have 30 days to respond.
The party first receiving such a claim shall take all reasonable action
necessary to defend against the claim including, but not limited to, responding
to court ordered deadlines before the expiration of the time for response.
Section 7.02. General Litigation.
(a) Claims to Be Transferred to Delphi. On the Contribution Date, the
legal responsibilities for the claims identified on Schedule K shall be
transferred in their entirety from GM to Delphi. As of the Contribution Date and
thereafter, Delphi shall assume the defense of these claims. Delphi shall
indemnify, defend and hold harmless GM against these claims. Delphi shall
reimburse GM for any reasonable attorneys fees and all other expenses reasonably
incurred by GM subsequent to the Contribution Date in connection with
investigating and/or defending against any such claim, including reimbursement
for any services provided by members of the GM Legal Staff.
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(b) Claims to be Defended by GM at Delphi's Expense. GM shall defend
the claims identified in Schedule L; provided, however, that (i) Delphi shall
indemnify and hold harmless GM against any judgments entered against GM on the
claims identified on Schedule L or settlements of the claims identified on
Schedule L, provided that GM may not compromise or settle any such claim without
the prior written consent of Delphi, which shall not be unreasonably withheld or
delayed, (ii) GM shall promptly compromise or settle claim(s) identified on
Schedule L if Delphi so directs, (iii) GM shall promptly permit Delphi to assume
responsibility for the defense of the claims identified on Schedule L if Delphi
so requests and (iv) Delphi shall reimburse GM for any reasonable attorneys'
fees and all other expenses reasonably incurred by GM subsequent to the
Contribution Date in connection with defending against the claims identified on
Schedule L, including reimbursement for any services provided by members of the
GM Legal Staff.
(c) Claims for which GM will Retain Liability. GM shall defend the
claims identified on Schedule M and shall indemnify and hold harmless Delphi
against any judgments entered against Delphi on the claims identified in
Schedule M or settlements of the claims identified on Schedule M. GM shall
reimburse Delphi for any reasonable attorneys' fees and all other expenses
reasonably incurred by Delphi subsequent to the Contribution Date in connection
with defending against the claims identified on Schedule M, including
reimbursement for any services provided by members of the Delphi Legal Staff.
Section 7.03. Employment Related Claims.
(a) Claims to Be Transferred to Delphi. On the Contribution Date, the
legal responsibilities for the claims identified on Schedule N shall be
transferred in their entirety from GM to Delphi. Thereafter, Delphi shall assume
the defense of these claims. Delphi shall indemnify, defend and hold harmless GM
against these claims. Delphi shall reimburse GM for any reasonable attorneys'
fees and all other expenses reasonably incurred by GM subsequent to the
Contribution Date in connection with investigating and/or defending against any
such claim, including reimbursement for any services provided by members of the
GM Legal Staff.
(b) Claims to be Jointly Defended by GM and Delphi. GM and Delphi
shall jointly defend the claims identified in Schedule O; provided, however,
that (i) Delphi shall indemnify and hold harmless GM against any judgments
entered against GM on the claims identified in Schedule O or settlements of the
claims identified in Schedule O, provided that GM may not compromise or settle
any such claim regarding employees of Delphi without the prior consent of
Delphi, which consent shall not be unreasonably withheld or delayed and (ii)
Delphi and GM shall split the attorneys' fees and all other expenses reasonably
incurred subsequent to the Contribution Date in connection with defending
against the unemployment claims identified in Schedule O based on the number of
hourly employees of each organization that are claimants in the litigation.
(c) Unscheduled Claims. Delphi will have financial responsibility
for employment related claims regarding all Delphi Employees and Delphi
Terminated Employees (as those terms are defined in the Employee Matters
Agreement, a copy of which is attached hereto as Exhibit B-1) whether incurred
before or after the Contribution Date. If a claim is not scheduled, Delphi and
GM shall mutually determine whether the claim is treated under Paragraph (a) or
(b) above. Responsibility for new U.S. claims will be treated in the same
manner. Notwithstanding the above, U.S. claims for pension and welfare benefits
from salaried employees who retire on or before the Contribution Date, and
hourly employees who retire on or before October 1, 1999 shall remain the
responsibility of GM.
Section 7.04. Cooperation. GM and Delphi and their respective
Affiliates shall cooperate with each other in the defense of any and all claims
covered under this Article 7 and afford to each other reasonable access upon
reasonable advance notice to witnesses and information (other than information
protected from disclosure by applicable privileges) that is reasonably required
to defend these claims as set forth in Article 6 of this Agreement. The
foregoing agreement to cooperate includes, but is not limited to, an obligation
to provide access to qualified assistance to provide information, witnesses and
documents to respond to discovery requests in specific lawsuits. In such cases,
cooperation shall be timely so that the party responding to discovery may meet
all court-imposed
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deadlines. The party requesting information shall reimburse the party providing
information consistent with the terms of Section 6.06 of this Agreement. The
obligations set forth in this paragraph are more clearly defined in Section 6.01
through and including 6.06 of this Agreement, to which reference is hereby made.
ARTICLE 8
INSURANCE MATTERS
SECTION 8.01 Delphi Insurance Coverage During the Transition Period.
(a) Throughout the period beginning on the Contribution Date and
ending on the earlier of the Distribution Date or the first anniversary of the
Contribution Date (i.e., the "Insurance Transition Period"), GM shall, subject
to insurance market conditions and other factors beyond its control, maintain
policies of insurance, including for the benefit of Delphi or any of its
Affiliates, directors, officers, employees or other covered parties
(collectively, the "Delphi Covered Parties") which are comparable to those
maintained generally by GM; provided, however, that this provision shall not
apply to insurance applicable to employees and/or beneficiaries relating to
benefits provided under ERISA governed benefit plans or to Personal Umbrella
Liability Insurance; provided, further, however, that if GM determines that (i)
the amount or scope of such coverage will be reduced to a level materially
inferior to the level of coverage in existence immediately prior to the
Insurance Transition Period or (ii) the retention or deductible level applicable
to such coverage, if any, will be increased to a level materially greater than
the levels in existence immediately prior to the Insurance Transition Period, GM
shall give Delphi notice of such determination as promptly as practicable. Upon
notice of such determination, Delphi shall be entitled to no less than 60 days
to evaluate its options regarding continuance of coverage hereunder and may
cancel all or any portion of such coverage as of any day within such 60 day
period. Except as provided below, during the Insurance Transition Period, such
policies of insurance shall cover Delphi Covered Parties for liabilities and
losses insured prior to the Contribution Date. To the extent of any self insured
or other loss retentions with respect to insurance policies in force, Delphi
shall, during the Insurance Transition Period, be solely responsible for any
losses, damages and related expenses, not included in GM insurance program
expense allocations to Delphi, incurred by itself or Delphi Covered Parties
within such loss or retentions and shall not seek reimbursement or
indemnification thereof from GM.
(b) GM will use all commercially reasonable efforts to assist Delphi
Covered Parties in asserting claims under applicable insurance policies, and
shall adjust such policies, as necessary and practicable, to provide for Delphi
and GM recoveries consistent with their respective interests and shall not
unduly favor one insured party over another.
(c) Delphi shall promptly pay or reimburse GM, as the case may be,
for premium expenses, and Delphi Covered Parties shall promptly pay or reimburse
GM for any costs and expenses which GM may incur in connection with the
insurance coverages maintained pursuant to this Section 8.01, including but not
limited to any subsequent premium adjustments. All payments and reimbursements
by Delphi and Delphi Covered Parties to GM shall be made within fifteen (15)
days after Delphi's receipt of an invoice from GM. Late payments shall bear
interest at the Prime Rate (as defined in Section 2.05(b) hereof) and shall be
paid in accordance with the terms relating to payments of interest set forth in
Section 2.05(b) of this Agreement.
(d) To the full extent permitted by contract and law, the control and
administration of such insurance policies, including claims against insurance
policies and any modifications to terms or conditions of insurance policies,
shall remain with GM (except that any such action taken by GM shall treat fairly
all insured parties and their respective claims and shall not unduly favor one
insured party over another). Delphi and Delphi Covered Parties shall make all
reasonable efforts to facilitate GM's control and administration of such
policies.
(e) GM's insurance policies shall be applicable to Delphi losses, as
follows: (i) with respect to any insurance policies where coverage is provided
on a "claims-made" or "occurrences reported" basis, any events,
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acts or omissions which may give rise to insured losses, or damages which give
rise to claims thereunder, must have occurred and notice given to GM prior to
expiration of the Insurance Transition Period; (ii) with respect to other types
of insurance policies, including those provided on an "occurrence" basis, any
events, acts or omissions giving rise to any insured losses or damages must have
occurred prior to expiration of the Insurance Transition Period; and (iii) with
respect to all claims under all insurance policies, coverage for events, acts or
omissions shall be interpreted consistent with the terms of such policies and
the intent of subparagraphs (i) and (ii) above.
(f) With respect to claims comprehended by the insurance policies, GM
and Delphi shall control the investigation, defense and settlement of all claims
as provided for in Article 7 of this Agreement; provided, however, that Delphi
may not effect any settlement with respect to any such claim without GM's prior
written consent (which consent shall not be unreasonably withheld or delayed)
unless such settlement (i) will have no direct impact on GM's future insurance
recoveries under relevant insurance policies, and (ii) will require that only
Delphi or Delphi Covered Parties, and not GM or its insurers, assume financial
responsibility for the settlement (under applicable deductibles or self-insured
retentions), any related expenses and/or any subsequent premium adjustments.
SECTION 8.02. Delphi Insurance Coverage After The Insurance Transition
Period. From and after expiration of the Insurance Transition Period, except as
provided herein, Delphi, and Delphi alone, shall be responsible for obtaining
and maintaining insurance programs for its risk of loss and such insurance
arrangements shall be separate and apart from GM's insurance programs.
Notwithstanding the foregoing, (a) GM, upon the request of Delphi, shall use all
commercially reasonable efforts to assist Delphi in the transition to its own
separate insurance programs from and after the Insurance Transition Period, and
shall provide Delphi with any information that is in the possession of GM and is
reasonably available and necessary to either obtain insurance coverages for
Delphi or to assist Delphi in preventing unintended self-insurance, in whatever
form, (b) each of GM and Delphi, at the request of the other, shall cooperate
with and use commercially reasonable efforts to assist the other in recoveries
from claims made under any insurance policy for the benefit of any insured
party; and (c) neither GM nor Delphi, nor any of their Affiliates, shall take
any action which would intentionally jeopardize or otherwise interfere with
either party's ability to collect any proceeds payable pursuant to any insurance
policy.
ARTICLE 9
MISCELLANEOUS
SECTION 9.01. Entire Agreement. This Agreement, including all the
Ancillary Agreements and all other Exhibits and Schedules attached hereto,
constitutes the entire agreement between the parties with respect to the subject
matter hereof and supersedes all prior written and oral and all contemporaneous
oral agreements and understandings with respect to the subject matter hereof,
other than with respect to the Cash and Debt Management Agreement, dated as of
December 22, 1998, among the Corporate Sector of GM, the Global Automotive
Sector of GM and the Delphi Automotive Systems Sector of GM.
SECTION 9.02. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware regardless of the
laws that might otherwise govern under principles of conflicts of laws
applicable thereto.
SECTION 9.03. Descriptive Headings. The descriptive headings herein are
inserted for convenience of reference only and are not intended to be part of or
to affect the meaning or interpretation of this Agreement.
SECTION 9.04. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given when delivered
in person, by telecopy with answer back, by express or overnight mail delivered
by a nationally recognized air courier (delivery charges prepaid), or by
registered or certified mail (postage prepaid, return receipt requested) to the
respective parties as follows:
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if to GM:
c/o General Motors Corporation
0000 Xxxx Xxxxx Xxxx.
Xxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxx
Telecopy: (000) 000-0000
if to Delphi, the Delphi U.S. Subsidiaries or Delphi International Subsidiary:
c/o Delphi Automotive Systems Corporation
0000 Xxxxxx Xxxxx
Xxxx, XX 00000
Attention: General Counsel
Telecopy: 000-000-0000
or to such other address as the party to whom notice is given may have
previously furnished to the others in writing in the manner set forth above. Any
notice or communication delivered in person shall be deemed effective on
delivery. Any notice or communication sent by telecopy or by air courier shall
be deemed effective on the first Business Day at the place at which such notice
or communication is received following the day on which such notice or
communication was sent. Any notice or communication sent by registered or
certified mail shall be deemed effective on the fifth Business Day at the place
from which such notice or communication was mailed following the day on which
such notice or communication was mailed.
SECTION 9.05. Parties in Interest. This Agreement shall be binding upon
and inure solely to the benefit of each party hereto and their legal
representatives and successors, and each Subsidiary and each Affiliate of the
parties hereto, and nothing in this Agreement, express or implied, is intended
to confer upon any other Person any rights or remedies of any nature whatsoever
under or by reason of this Agreement, except for Article 5 (which is intended to
be for the benefit of the Persons provided for therein and may be enforced by
such Persons).
SECTION 9.06. Counterparts. This Agreement 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 9.07. Binding Effect; Assignment. This Agreement shall inure to
the benefit of and be binding upon the parties hereto and their respective legal
representatives and successors. This Agreement may not be assigned by any party
hereto. The Schedules and Exhibits attached hereto or referred to herein are an
integral part of this Agreement and are hereby incorporated into this Agreement
and made a part hereof as if set forth in full herein.
SECTION 9.08. Dispute Resolution. Except as otherwise set forth in the
Ancillary Agreements, resolution of any and all disputes arising from or in
connection with this Agreement (excluding matters related to the Supply
Agreement), whether based on contract, tort, or otherwise (collectively,
"Disputes"), shall be exclusively governed by and settled in accordance with the
provisions of this Section 9.08. The parties hereto shall use all commercially
reasonable efforts to settle all Disputes without resorting to mediation,
arbitration, litigation or other third party dispute resolution mechanisms. If
any Dispute remains unsettled, a party hereto may commence proceedings hereunder
by first delivering a written notice from a Senior Vice President or comparable
executive officer of such party (the "Demand") to the other parties providing
reasonable description of the Dispute to the others and expressly requesting
mediation hereunder. The parties hereby agree to submit all Disputes to
non-binding mediation before a mediator reasonably acceptable to all parties
involved in such Dispute. If, after such mediation, the parties subject to such
mediation disagree regarding the mediator's recommendation, such Dispute shall
be submitted to arbitration under the terms hereof, which arbitration shall be
final, conclusive and binding upon the parties, their successors and assigns.
The arbitration shall be conducted in Detroit, Michigan by three arbitrators
acting by majority vote (the
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"Panel") selected by agreement of the parties not later than ten (10) days after
the delivery of the recommendation provided by the mediator as described above
or, failing such agreement, appointed pursuant to the commercial arbitration
rules of the American Arbitration Association, as amended from time to time (the
"AAA Rules"). If an arbitrator so selected becomes unable to serve, his or her
successors shall be similarly selected or appointed. The arbitration shall be
conducted pursuant to the Federal Arbitration Act and such procedures as the
parties subject to such arbitration (each, a "Party") may agree, or, in the
absence of or failing such agreement, pursuant to the AAA Rules. Notwithstanding
the foregoing: (i) each Party shall have the right to audit the books and
records of the other Party that are reasonably related to the Dispute; (ii) each
Party shall provide to the other, reasonably in advance of any hearing, copies
of all documents which a Party intends to present in such hearing; and (iii)
each Party shall be allowed to conduct reasonable discovery through written
requests for information, document requests, requests for stipulation of fact
and depositions, the nature and extent of which discovery shall be determined by
the Parties; provided that if the Parties cannot agree on the terms of such
discovery, the nature and extent thereof shall be determined by the Panel which
shall take into account the needs of the Parties and the desirability of making
discovery expeditious and cost effective. The award shall be in writing and
shall specify the factual and legal basis for the award. The Panel shall
apportion all costs and expenses of arbitration, including the Panel's fees and
expenses and fees and expenses of experts, between the prevailing and
non-prevailing Party as the Panel deems fair and reasonable. The parties hereto
agree that monetary damages may be inadequate and that any party by whom this
Agreement is enforceable shall be entitled to seek specific performance of the
arbitrators' decision from a court of competent jurisdiction, in addition to any
other appropriate relief or remedy. Notwithstanding the foregoing, in no event
may the Panel award consequential, special, exemplary or punitive damages. Any
arbitration award shall be binding and enforceable against the parties hereto
and judgment may be entered thereon in any court of competent jurisdiction.
SECTION 9.09. Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable manner to
the end that transactions contemplated hereby are fulfilled to the fullest
extent possible.
SECTION 9.10. Failure or Indulgence Not Waiver; Remedies Cumulative. No
failure or delay on the part of any party hereto in the exercise of any right
hereunder shall impair such right or be construed to be a waiver of, or
acquiescence in, any breach of any representation, warranty or agreement herein,
nor shall any single or partial exercise of any such right preclude other or
further exercise thereof or of any other right. All rights and remedies existing
under this Agreement are cumulative to, and not exclusive of, any rights or
remedies otherwise available.
SECTION 9.11. Amendment. No change or amendment will be made to this
Agreement or the Ancillary Agreements except by an instrument in writing signed
on behalf of each of the parties to such agreement.
SECTION 9.12. 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 and the Ancillary Agreements, (b)
the execution, delivery and performance of this Agreement and the Ancillary
Agreements by it have been duly authorized by all necessary corporate or other
action, (c) it has duly and validly executed and delivered this Agreement and
the Ancillary Agreements, and (d) this Agreement and each Ancillary 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 9.13. Interpretation. The headings contained in this Agreement,
in any Exhibit or Schedule hereto and in the table or contents to this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Any capitalized term used in any Schedule or
Exhibit but not
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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.
After the Contribution Date, the Delphi Automotive Systems Business shall be
deemed to no longer exist and all references made herein to Delphi as a party
which operate as of a time following the Contribution Date, shall be deemed to
refer to Delphi, the Delphi U.S. Subsidiaries and Delphi International
Subsidiary as a single party.
******
[SIGNATURES ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed on its behalf by its officers thereunto duly authorized on the day and
year first above written.
GENERAL MOTORS CORPORATION
By: /s/ G. Xxxxxxx Xxxxxxx
----------------------------------
Name: G. Xxxxxxx Xxxxxxx
Title: President and Chief Operating Officer
DELPHI AUTOMOTIVE SYSTEMS CORPORATION
By: /s/ X.X. Xxxxxxxxxx, III
----------------------------------
Name: X.X. Xxxxxxxxxx, III
Title: Chairman, Chief Executive Officer and
President
DELPHI AUTOMOTIVE SYSTEMS LLC
By: /s/ X.X. Xxxxxxxxxx, III
----------------------------------
Name: X.X. Xxxxxxxxxx, III
Title: Chief Executive Officer and
President
DELPHI TECHNOLOGIES, INC.
By: /s/ Xxxxxx Xxxxx, Jr
----------------------------------
Name: Xxxxxx Xxxxx, Jr.
Title: President
DELPHI AUTOMOTIVE SYSTEMS (HOLDING), INC.
By: /s/ Xxxx X. Xxxx
----------------------------------
Name: Xxxx X. Xxxx
Title: President
