EXHIBIT 2.1
MASTER SEPARATION AND DISTRIBUTION AGREEMENT
BETWEEN
ADAPTEC, INC.
AND
ROXIO, INC.
EFFECTIVE AS OF
SEPTEMBER 21, 2000
TABLE OF CONTENTS
PAGE
ARTICLE I SEPARATION..................................................................................................2
Section 1.1 Separation Date............................................................................2
Section 1.2 Closing of Transactions....................................................................2
Section 1.3 Exchange of Secretary's Certificates.......................................................2
ARTICLE II DOCUMENTS AND ITEMS TO BE DELIVERED ON THE SEPARATION DATE.................................................2
Section 2.1 Documents to Be Delivered By Adaptec.......................................................2
Section 2.2 Bridge Loan................................................................................3
Section 2.3 Documents to Be Delivered by Roxio.........................................................3
ARTICLE III THE IPO AND ACTIONS PENDING THE IPO.......................................................................4
Section 3.1 Transactions Prior to the IPO..............................................................4
Section 3.2 Proceeds of the IPO........................................................................5
Section 3.3 Cooperation................................................................................5
Section 3.4 Conditions Precedent to Consummation of the IPO............................................5
ARTICLE IV THE DISTRIBUTION...........................................................................................6
Section 4.1 The Distribution...........................................................................6
Section 4.2 Actions Prior To The Distribution..........................................................6
Section 4.3 Sole Discretion of Adaptec.................................................................7
Section 4.4 Conditions To Distribution.................................................................7
Section 4.5 Fractional Shares..........................................................................8
ARTICLE V COVENANTS AND OTHER MATTERS.................................................................................8
Section 5.1 Other Agreements...........................................................................8
Section 5.2 Further Instruments........................................................................8
Section 5.3 Agreement For Exchange of Information......................................................9
Section 5.4 Auditors and Audits; Annual and Quarterly Statements and Accounting.......................10
Section 5.5 Consistency with Past Practices...........................................................12
Section 5.6 Payment of Expenses.......................................................................12
Section 5.7 Dispute Resolution........................................................................12
Section 5.8 Governmental Approvals....................................................................13
Section 5.9 Representations and Warranties............................................................13
Section 5.10 Cooperation in Obtaining New Agreements...................................................14
Section 5.11 Property Damage to Roxio Assets Prior to the Separation Date..............................14
Section 5.12 Asset Transfers in Connection with Separation.............................................14
ARTICLE VI MISCELLANEOUS.............................................................................................15
Section 6.1 Limitation of Liability...................................................................15
Section 6.2 Entire Agreement..........................................................................15
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TABLE OF CONTENTS
(CONTINUED)
PAGE
Section 6.3 Governing Law.............................................................................15
Section 6.4 Termination...............................................................................15
Section 6.5 Notices...................................................................................15
Section 6.6 Counterparts..............................................................................16
Section 6.7 Binding Effect; Assignment................................................................16
Section 6.8 Severability..............................................................................17
Section 6.9 Waiver of Breach..........................................................................17
Section 6.10 Amendment and Execution...................................................................17
Section 6.11 Authority.................................................................................17
Section 6.12 Descriptive Headings......................................................................17
Section 6.13 Gender and Number.........................................................................17
Section 6.14 Additional Assurances.....................................................................18
Section 6.15 Force Majeure.............................................................................18
Section 6.16 Conflicting Agreements....................................................................18
ARTICLE VII DEFINITIONS..............................................................................................18
Section 7.1 Adaptec Business..........................................................................18
Section 7.2 Adaptec Group.............................................................................18
Section 7.3 Adaptec's Auditors........................................................................18
Section 7.4 Ancillary Agreements......................................................................18
Section 7.5 Assignment Agreement......................................................................18
Section 7.6 Business Day..............................................................................18
Section 7.7 Code......................................................................................18
Section 7.8 Commission................................................................................18
Section 7.9 Disputes..................................................................................19
Section 7.10 Distribution..............................................................................19
Section 7.11 Distribution Agent........................................................................19
Section 7.12 Distribution Date.........................................................................19
Section 7.13 Exchange Act..............................................................................19
Section 7.14 GAAP......................................................................................19
Section 7.15 Governmental Approvals....................................................................19
Section 7.16 Governmental Authority....................................................................19
Section 7.17 Xxxx Xxxx.................................................................................19
Section 7.18 Information...............................................................................19
Section 7.19 IPO.......................................................................................19
Section 7.20 IPO Closing Date..........................................................................19
Section 7.21 IPO Net Proceeds..........................................................................19
Section 7.22 IPO Registration Statement................................................................20
Section 7.23 Nasdaq....................................................................................20
Section 7.24 Person....................................................................................20
Section 7.25 Prime Rate................................................................................20
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TABLE OF CONTENTS
(CONTINUED)
PAGE
Section 7.26 Record Date...............................................................................20
Section 7.27 Roxio Assets..............................................................................20
Section 7.28 Roxio's Auditors..........................................................................20
Section 7.29 Roxio Business............................................................................20
Section 7.30 Roxio Group...............................................................................20
Section 7.31 Separation................................................................................20
Section 7.32 Separation Date...........................................................................20
Section 7.33 Subsidiary................................................................................20
Section 7.34 Transferred Subsidiary....................................................................21
Section 7.35 Transitional Service Schedules............................................................21
Section 7.36 Underwriters..............................................................................21
Section 7.37 Underwriting Agreement....................................................................21
Section 7.38 WSGR......................................................................................21
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EXHIBITS
Exhibit A Certificate of Secretary of Adaptec
Exhibit B Certificate of Secretary of Roxio
Exhibit C General Assignment and Assumption Agreement
Exhibit D-1 Master Technology Ownership and License Agreement
Exhibit D-2 Master Patent Ownership and License Agreement
Exhibit E Employee Matters Agreement
Exhibit F Tax Sharing Agreement
Exhibit G Real Estate Agreement
Exhibit H Master Confidential Disclosure Agreement
Exhibit I Indemnification and Insurance Matters Agreement
Exhibit J Manufacturing Agreement
Exhibit K Master Transitional Services Agreement
Exhibit L Bridge Loan Promissory Note
Exhibit M International Transfer of Assets Agreement
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SCHEDULES
Schedule 2.1(b) Subsidiaries of Adaptec to be Transferred to Roxio
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MASTER SEPARATION AND DISTRIBUTION AGREEMENT
This Master Separation and Distribution Agreement (this "AGREEMENT") is
entered into as of September 21, 2000, between Adaptec, Inc. ("ADAPTEC"), a
Delaware corporation, and Roxio, Inc. ("ROXIO"), a Delaware corporation.
Capitalized terms used herein and not otherwise defined shall have the meanings
ascribed to such terms in ARTICLE VII hereof. Adaptec and Roxio are sometimes
referred to herein individually as a "party" or collectively as the "parties."
RECITALS
WHEREAS, the Boards of Directors of each of Adaptec and Roxio have
determined that it is appropriate and desirable for Adaptec to contribute and
transfer to Roxio, and for Roxio to receive and assume, directly or indirectly,
substantially all of the assets and liabilities currently associated with the
Roxio Business and the stock, investments or similar interests currently held by
Adaptec in subsidiaries and other entities that conduct such business (the
"SEPARATION");
WHEREAS, Adaptec has caused Roxio to be incorporated in order to effect
the Separation and Adaptec currently owns all of the issued and outstanding
capital stock of Roxio;
WHEREAS, Adaptec and Roxio currently contemplate that, following the
contribution and assumption of assets and liabilities, Roxio will make an
initial public offering ("IPO") of an amount of its common stock pursuant to a
registration statement on Form S-1 pursuant to the Securities Act of 1933, as
amended (the "IPO REGISTRATION STATEMENT"), that will reduce Adaptec's ownership
of the issued and outstanding capital stock of Roxio to not less than 80.1%;
WHEREAS, Adaptec currently contemplates that, several months following
the IPO, Adaptec will distribute to the holders of its common stock, $ 0.01 par
value, by means of a pro rata distribution, all of the shares of Roxio common
stock owned by Adaptec (the "DISTRIBUTION");
WHEREAS, Adaptec and Roxio intend that the Separation and the
Distribution will qualify as a tax-free reorganization under Sections
368(a)(1)(D) and 355 of the Internal Revenue Code of 1986, as amended (the
"CODE"), and that this Agreement is intended to be, and is hereby adopted as, a
plan of reorganization under Section 368 of 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 Roxio Business.
NOW, THEREFORE, in consideration of the foregoing and the covenants and
agreements set forth below, the parties hereto agree as follows:
ARTICLE I
SEPARATION
SECTION 1.1 SEPARATION DATE. Unless otherwise provided in this Agreement,
or in any agreement to be executed in connection with this Agreement, the
effective time and date of each transfer of property, assumption of liability,
license, undertaking, or agreement in connection with the Separation shall be
12:01 a.m., Pacific Time, November 4, 2000 or such other date as may be fixed by
the Board of Directors of Adaptec (the "SEPARATION DATE").
SECTION 1.2 CLOSING OF TRANSACTIONS. Unless otherwise provided herein, the
closing of the transactions contemplated in ARTICLE II shall occur by the
lodging of each of the executed instruments of transfer, assumptions of
liability, undertakings, agreements, instruments or other documents executed or
to be executed with both Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, Professional
Corporation ("WSGR"), 000 Xxxx Xxxx Xxxx, Xxxx Xxxx, Xxxxxxxxxx 00000, and Xxxx
Xxxx Xxxx & Freidenrich LLP ("XXXX XXXX"), 000 Xxxxxxxx Xxxxxx, Xxxx Xxxx,
Xxxxxxxxxx 00000, to be held in escrow for delivery as provided in SECTION 1.3
of this Agreement.
SECTION 1.3 EXCHANGE OF SECRETARY'S CERTIFICATES. Upon receipt of a
certificate of the Secretary or an Assistant Secretary of Adaptec in the form
attached to this Agreement as EXHIBIT A, WSGR shall deliver to Roxio on behalf
of Adaptec all of the items required to be delivered by Adaptec hereunder
pursuant to SECTION 2.1 of this Agreement and each such item shall be deemed to
be delivered to Roxio as of the Separation Date upon delivery of such
certificate. Upon receipt of a certificate of the Secretary or an Assistant
Secretary of Roxio in the form attached to this Agreement as EXHIBIT B, Xxxx
Xxxx shall deliver to Adaptec on behalf of Roxio all of the items required to be
delivered by Roxio pursuant to SECTION 2.2 hereunder and each such item shall be
deemed to be delivered to Adaptec as of the Separation Date upon receipt of such
certificate.
ARTICLE II
DOCUMENTS AND ITEMS TO BE DELIVERED ON OR BEFORE THE SEPARATION DATE
SECTION 2.1 DOCUMENTS TO BE DELIVERED BY ADAPTEC. On or before the
Separation Date, Adaptec will deliver, or will cause its appropriate
Subsidiaries to deliver, to Roxio all of the following items and agreements
(collectively, together with all agreements and documents contemplated by
such agreements, the "ANCILLARY AGREEMENTS"):
(a) A duly executed General Assignment and Assumption Agreement (the
"ASSIGNMENT AGREEMENT") substantially in the form attached hereto as EXHIBIT C;
(b) Certificates representing the stock in the Subsidiaries (the
"TRANSFERRED SUBSIDIARIES") of Adaptec set forth on SCHEDULE 2.1(b) with duly
executed stock powers in the form proper for transfer;
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(c) A duly executed Master Technology Ownership and License Agreement
substantially in the form attached hereto as EXHIBIT D-1, a duly executed Master
Patent Ownership and License Agreement substantially in the form attached hereto
as EXHIBIT D-2, and;
(d) A duly executed Employee Matters Agreement substantially in the
form attached hereto as EXHIBIT E;
(e) A duly executed Tax Sharing Agreement substantially in the form
attached hereto as EXHIBIT F;
(f) A duly executed Real Estate Matters Agreement substantially in the
form attached hereto as EXHIBIT G;
(g) A duly executed Master Confidential Disclosure Agreement
substantially in the form attached hereto as EXHIBIT H;
(h) A duly executed Indemnification and Insurance Matters Agreement
substantially in the form attached hereto as EXHIBIT I;
(i) A duly executed Manufacturing Agreement substantially in the form
attached hereto as EXHIBIT J;
(j) A duly executed Master Transitional Services Agreement
substantially in the form attached hereto as EXHIBIT K;
(k) A duly executed Bridge Loan Promissory Note substantially in the
form attached hereto as EXHIBIT L;
(l) A duly executed International Transfer of Assets Agreement
substantially in the form attached hereto as EXHIBIT M.
(m) Resignations of each person who is an officer or director of any
member of Roxio or its Subsidiaries immediately prior to the Separation Date,
but who will be an employee of only Adaptec from and after the Separation Date;
and
(n) Such other agreements, documents or instruments as the parties may
agree are necessary or desirable in order to achieve the purposes hereof,
including, without limitation, all Transitional Service Schedules to the Master
Transitional Services Agreement and those documents referred to in SECTION 5.7.
SECTION 2.2 BRIDGE LOAN.
On or around the Separation Date, Adaptec will make an unsecured loan to
Roxio in the amount of $30,000,000, which shall have an interest rate of the
applicable federal rate as of the Separation Date and which shall become due and
payable upon the earlier of (i) one year after the Separation Date or (ii) 10
Business Days after the IPO Closing Date, as evidenced by that certain Bridge
Loan Promissory Note attached as EXHIBIT L.
SECTION 2.3 DOCUMENTS TO BE DELIVERED BY ROXIO. As of the Separation Date,
Roxio will or will cause its appropriate Subsidiaries to deliver to Adaptec all
of the following:
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(a) In each case where Roxio is a party to any agreement or instrument
referred to in SECTION 2.1, a duly executed counterpart of such agreement or
instrument; and
(b) Resignations of each person who is an officer or director of any
member of the Adaptec Group immediately prior to the Separation Date, but who
will be an employee or director of only Roxio or its Subsidiaries from and after
the Separation Date.
(c) Bridge Loan Promissory Note
ARTICLE III
THE IPO AND ACTIONS PENDING THE IPO
SECTION 3.1 TRANSACTIONS PRIOR TO THE IPO. Subject to the conditions
specified in SECTION 3.4, Adaptec and Roxio shall use their reasonable
commercial efforts to consummate the IPO. Such efforts shall include, but not
necessarily be limited to, those specified in this SECTION 3.1.
(a) REGISTRATION STATEMENT. Roxio, with the cooperation and assistance
of Adaptec, shall file the IPO Registration Statement, and such amendments or
supplements thereto, as may be necessary in order to cause the same to become
and remain effective as required by law or by the managing underwriters for the
IPO (the "UNDERWRITERS"), including, but not limited to, filing such amendments
to the IPO Registration Statement as may be required by the underwriting
agreement to be entered into among Roxio and the Underwriters (the "UNDERWRITING
AGREEMENT"), the Securities and Exchange Commission (the "COMMISSION") or
federal, state or foreign securities laws. Adaptec and Roxio shall also
cooperate in preparing, filing with the United States Securities and Exchange
Commission and causing to become effective a registration statement registering
the common stock of Roxio under the Securities and Exchange Act of 1934, as
amended (the "EXCHANGE ACT"), and any registration statements or amendments
thereof which are required to reflect the establishment of, or amendments to,
any employee benefit and other plans necessary or appropriate in connection with
the IPO, the Separation, the Distribution or the other transactions contemplated
by this Agreement.
(b) UNDERWRITING AGREEMENT. Roxio shall enter into the Underwriting
Agreement, in form and substance reasonably satisfactory to Roxio, and shall
comply with its obligations thereunder.
(c) OTHER MATTERS. Adaptec and Roxio shall consult with each other and
the Underwriters regarding the timing, pricing and other material matters with
respect to the IPO.
(d) BLUE SKY. Roxio shall use its reasonable commercial efforts to
take all such action as may be necessary or appropriate under state securities
and blue sky laws of the United States (and any comparable laws under any
foreign jurisdictions) in connection with the IPO.
(e) NASDAQ LISTING. Roxio shall prepare, file and use reasonable
commercial efforts to seek to make effective, an application for listing of the
common stock of Roxio issued in the IPO on the Nasdaq National Market
("NASDAQ"), subject to official notice of issuance.
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SECTION 3.2 PROCEEDS OF THE IPO. The IPO will be a primary offering of
common stock of Roxio. All of the IPO Net Proceeds will be retained by Roxio.
SECTION 3.3 COOPERATION. Roxio shall consult with, and cooperate in all
respects with, Adaptec in connection with the pricing of the common stock of
Roxio to be offered in the IPO and shall, at Adaptec's direction, promptly take
any and all actions necessary or desirable to consummate the IPO as contemplated
by the IPO Registration Statement and the Underwriting Agreement.
SECTION 3.4 CONDITIONS PRECEDENT TO CONSUMMATION OF THE IPO. The parties
hereto shall use their reasonable commercial efforts to consummate the IPO prior
to December 15, 2000, or as soon thereafter as practicable. The obligations of
the parties to consummate the IPO shall be conditioned on the satisfaction, or
written waiver by Adaptec, of the following conditions:
(a) REGISTRATION STATEMENT. The IPO Registration Statement shall have
been filed and declared effective by the Commission, and there shall be no
stop-order in effect with respect thereto.
(b) NASDAQ LISTING. The common stock of Roxio to be issued in the IPO
shall have been accepted for listing on Nasdaq, on official notice of issuance.
(c) UNDERWRITING AGREEMENT. Roxio shall have entered into the
Underwriting Agreement and all conditions to the obligations of Roxio and the
Underwriters shall have been satisfied or waived.
(d) CAPITAL STOCK OWNERSHIP. Adaptec shall be satisfied in its sole
discretion that it will own at least 80.1% of the outstanding capital stock of
Roxio following the IPO. All other conditions to permit the Distribution to
qualify under Sections 355 and 368 of the Code as tax-free to Adaptec, Roxio and
Adaptec's stockholders shall, to the extent applicable as of the time of the
IPO, be satisfied. There shall be no event or condition that is likely to cause
any of such conditions not to be satisfied as of the time of the Distribution or
thereafter.
(e) NO LEGAL RESTRAINTS. No order, injunction or decree issued by any
court or agency of competent jurisdiction or other legal restraint or
prohibition preventing the consummation of the Separation or the IPO or any of
the other transactions contemplated by this Agreement shall be in effect.
(f) SEPARATION. The Separation shall have become effective as
described in ARTICLES I AND II hereof.
(g) OTHER ACTIONS. Such other actions as the parties hereto may, based
upon the advice of counsel, reasonably request to be taken prior to the IPO in
order to assure the successful completion of the IPO shall have been taken.
(h) NO TERMINATION. This Agreement shall not have been terminated.
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ARTICLE IV
THE DISTRIBUTION
SECTION 4.1 THE DISTRIBUTION.
(a) DELIVERY OF SHARES FOR DISTRIBUTION. Subject to SECTION 4.4
hereof, on or prior to the date the Distribution is effective (the "DISTRIBUTION
DATE"), Adaptec will deliver to the distribution agent (the "DISTRIBUTION
AGENT") to be appointed by Adaptec to distribute to the stockholders of Adaptec
the shares of common stock of Roxio held by Adaptec pursuant to the Distribution
for the benefit of holders of record of common stock of Adaptec on the Record
Date, a single stock certificate, endorsed by Adaptec in blank, representing all
of the outstanding shares of common stock of Roxio then owned by Adaptec, and
shall cause the transfer agent for the shares of common stock of Adaptec to
instruct the Distribution Agent to distribute on the Distribution Date the
appropriate number of such shares of common stock of Roxio to each such holder
or designated transferee or transferees of such holder.
(b) SHARES RECEIVED. Subject to SECTIONS 4.4 and 4.5, each holder of
common stock of Adaptec on the Record Date (or such holder's designated
transferee or transferees) will be entitled to receive in the Distribution a
number of shares of common stock of Roxio equal to the number of shares of
common stock of Adaptec held by such holder on the Record Date multiplied by a
fraction the numerator of which is the number of shares of common stock of Roxio
beneficially owned by Adaptec on the Record Date and the denominator of which is
the number of shares of common stock of Adaptec outstanding on the Record Date.
(c) OBLIGATION TO PROVIDE INFORMATION. Roxio and Adaptec, as the case
may be, will provide to the Distribution Agent all share certificates and any
information required in order to complete the Distribution on the basis
specified above.
SECTION 4.2 ACTIONS PRIOR TO THE DISTRIBUTION.
(a) INFORMATION STATEMENT. Adaptec and Roxio shall prepare and mail,
prior to the Distribution Date, to the holders of common stock of Adaptec, such
information concerning Roxio and the Distribution and such other matters as
Adaptec and Roxio shall reasonably determine are necessary and as may be
required by law. Adaptec and Roxio will prepare, and Roxio will, to the extent
required under applicable law, file with the Commission any such documentation
which Adaptec and Roxio reasonably determine is necessary or desirable to
effectuate the Distribution, and Adaptec and Roxio shall each use its reasonable
commercial efforts to obtain all necessary approvals from the Commission with
respect thereto as soon as practicable.
(b) BLUE SKY. Adaptec and Roxio shall take all such actions as may be
necessary or appropriate under the securities or blue sky laws of the United
States (and any comparable laws under any foreign jurisdiction) in connection
with the Distribution.
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(c) NASDAQ LISTING. Roxio shall prepare and file, and shall use its
reasonable commercial efforts to have approved, an application for the listing
of the common stock of Roxio to be distributed in the Distribution on Nasdaq,
subject to official notice of distribution.
(d) CONDITIONS. Adaptec and Roxio shall take all reasonable steps
necessary and appropriate to cause the conditions set forth in SECTION 4.4 to be
satisfied and to effect the Distribution on the Distribution Date.
SECTION 4.3 SOLE DISCRETION OF ADAPTEC. Adaptec currently intends,
following the consummation of the IPO, to complete the Distribution by June 30,
2001. Adaptec shall, in its sole and absolute discretion, determine the date of
the consummation of the Distribution and all terms of the Distribution,
including, without limitation, the form, structure and terms of any
transaction(s) and/or offering(s) to effect the Distribution and the timing of
and conditions to the consummation of the Distribution. In addition, Adaptec may
at any time and from time to time until the completion of the Distribution
modify or change the terms of the Distribution, including, without limitation,
by accelerating or delaying the timing of the consummation of all or part of the
Distribution. Roxio shall cooperate with Adaptec in all respects to accomplish
the Distribution and shall, at Adaptec's direction, promptly take any and all
actions necessary or desirable to effect the Distribution, including, without
limitation, the registration under the Securities Act of the common stock of
Roxio on an appropriate registration form or forms to be designated by Adaptec.
Adaptec shall select any investment banker(s) and manager(s) in connection with
the Distribution, as well as any financial printer, solicitation and/or exchange
agent and outside counsel for Adaptec; PROVIDED, HOWEVER, that nothing herein
shall prohibit Roxio from engaging (at its own expense) its own financial,
legal, accounting and other advisors in connection with the Distribution.
SECTION 4.4 CONDITIONS TO DISTRIBUTION. The following are conditions to the
consummation of the Distribution. The conditions are for the sole benefit of
Adaptec and shall not give rise to or create any duty on the part of Adaptec or
the Adaptec Board of Directors to waive or not waive any such condition.
(a) IRS RULING. Adaptec shall have obtained a private letter ruling
from the Internal Revenue Service in form and substance satisfactory to Adaptec
(in its sole discretion), and such ruling shall remain in effect as of the
Distribution Date, to the effect that (i) the transfer by the Adaptec Group to
the Roxio Group of the property, subject to liabilities, of the Roxio Business
in exchange for the issuance to Adaptec of the stock of Roxio, and Roxio's
assumption of liabilities, followed by the distribution by Adaptec of all of its
Roxio stock to the stockholders of Adaptec, will qualify as a reorganization
under Sections 368(a)(1)(D) and 355 of the Code; (ii) no gain or loss will be
recognized by Adaptec on its transfer of the property of the Roxio Business to
Roxio in exchange for Roxio common stock; (iii) no gain or loss will be
recognized by Roxio on its receipt of the property of the Roxio Business from
Adaptec in exchange for the issuance of Roxio common stock; and (iv) no gain or
loss will be recognized by (and no amount will otherwise be included in the
income of) the stockholders of Adaptec upon their receipt of Roxio common stock
pursuant to the Distribution.
(b) GOVERNMENT APPROVALS. Any material governmental approvals and
consents necessary to consummate the Distribution shall have been obtained and
be in full force and effect;
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(c) NO LEGAL RESTRAINTS. No order, injunction or decree issued by any
court or agency of competent jurisdiction or other legal restraint or
prohibition preventing the consummation of the Distribution shall be in effect
and no other event outside the control of Adaptec shall have occurred or failed
to occur that prevents the consummation of the Distribution; and
(d) NO MATERIAL ADVERSE EFFECT. No other events or developments shall
have occurred subsequent to the IPO Closing Date that, in the judgment of the
Board of Directors of Adaptec, would result in the Distribution having a
material adverse effect on Adaptec or on the stockholders of Adaptec.
SECTION 4.5 FRACTIONAL SHARES. As soon as practicable after the
Distribution Date, Adaptec shall direct the Distribution Agent to determine the
number of whole shares and fractional shares of common stock of Roxio allocable
to each holder of record or beneficial owner of common stock of Adaptec as of
the Record Date, to aggregate all such fractional shares and sell the whole
shares obtained thereby at the direction of Adaptec, in open market
transactions, at then prevailing trading prices, and to cause to be distributed
to each such holder or for the benefit of each such beneficial owner to which a
fractional share shall be allocable such holder's or owner's ratable share of
the proceeds of such sale, after making appropriate deductions of the amount
required to be withheld for federal income tax purposes and after deducting an
amount equal to all brokerage charges, commissions and transfer taxes attributed
to such sale. Adaptec and the Distribution Agent shall use their reasonable
commercial efforts to aggregate the shares of common stock of Adaptec that may
be held by any beneficial owner thereof through more than one account in
determining the fractional share allocable to such beneficial owner.
ARTICLE V
COVENANTS AND OTHER MATTERS
SECTION 5.1 OTHER AGREEMENTS. In addition to the specific agreements,
documents and instruments that are Exhibits to this Agreement, Adaptec and Roxio
agree to execute or cause to be executed by the appropriate parties and deliver,
as appropriate, such other agreements, instruments and other documents as may be
necessary or desirable in order to effect the purposes of this Agreement and the
Ancillary Agreements.
SECTION 5.2 FURTHER INSTRUMENTS. At the request of Roxio and without
further consideration, Adaptec will execute and deliver, and will cause its
applicable Subsidiaries to execute and deliver, to Roxio and its Subsidiaries
such other instruments of transfer, conveyance, assignment, substitution and
confirmation and take such action as Roxio may reasonably deem necessary or
desirable in order more effectively to transfer, convey and assign to Roxio and
its Subsidiaries and confirm Roxio's and its Subsidiaries' title to all of the
assets, rights and other things of value contemplated to be transferred to Roxio
and its Subsidiaries pursuant to this Agreement, the Ancillary Agreements, and
any documents referred to therein, to put Roxio and its Subsidiaries in actual
possession and operating control thereof and to permit Roxio and its
Subsidiaries to exercise all rights with respect thereto (including, without
limitation, rights under contracts and other arrangements as to which the
consent of any third party to the transfer thereof shall not have
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previously been obtained). At the request of Adaptec and without further
consideration, Roxio will execute and deliver, and will cause its applicable
Subsidiaries to execute and deliver, to Adaptec and its Subsidiaries all
instruments, assumptions, novations, undertakings, substitutions or other
documents and take such other action as Adaptec may reasonably deem necessary or
desirable in order to have Roxio fully and unconditionally assume and discharge
the liabilities contemplated to be assumed by Roxio under this Agreement or any
document in connection herewith and to relieve the Adaptec Group of any
liability or obligation with respect thereto and evidence the same to third
parties. Neither Adaptec nor Roxio shall be obligated, in connection with the
foregoing, to expend money other than reasonable out-of-pocket expenses,
attorneys' fees and recording or similar fees. Furthermore, each party, at the
request of another party hereto, shall execute and deliver such other
instruments and do and perform such other acts and things as may be necessary or
desirable for effecting completely the consummation of the transactions
contemplated hereby.
SECTION 5.3 AGREEMENT FOR EXCHANGE OF INFORMATION. Each of Adaptec and
Roxio agrees to provide, or cause to be provided, to each other, at any time
before or after the Distribution Date, as soon as reasonably practicable after
written request therefor, any Information in the possession or under the control
of such party that the requesting party reasonably needs (i) to comply with
reporting, disclosure, filing or other requirements imposed on the requesting
party (including under applicable securities laws) by a Governmental Authority
having jurisdiction over the requesting party, (ii) for use in any other
judicial, regulatory, administrative or other proceeding or in order to satisfy
audit, accounting, claims, regulatory, litigation or other similar requirements,
(iii) to comply with its obligations under this Agreement or any Ancillary
Agreement or (iv) in connection with the ongoing businesses of Adaptec or Roxio,
as the case may be; PROVIDED, HOWEVER, that in the event that any party
determines that any such provision of Information could be commercially
detrimental, violate any law or agreement, or waive any attorney-client
privilege, the parties shall take all reasonable measures to permit the
compliance with such obligations in a manner that avoids any such harm or
consequence.
(a) INTERNAL ACCOUNTING CONTROLS; FINANCIAL INFORMATION. Until the
seventh anniversary of the Separation Date, (i) each party shall maintain in
effect at its own cost and expense adequate systems and controls for its
business to the extent necessary to enable the other party to satisfy its
reporting, accounting, audit and other obligations, and (ii) each party shall
provide, or cause to be provided, to the other party and its Subsidiaries in
such form as such requesting party shall request, at no charge to the requesting
party, all financial and other data and information as the requesting party
determines necessary or advisable in order to prepare its financial statements
and reports or filings with any Governmental Authority.
(b) OWNERSHIP OF INFORMATION. Any Information owned by a party that is
provided to a requesting party pursuant to this SECTION 5.3 shall be deemed to
remain the property of the providing party. Unless specifically set forth
herein, nothing contained in this Agreement shall be construed as granting or
conferring rights of license or otherwise in any such Information.
(c) RECORD RETENTION. To facilitate the possible exchange of
Information pursuant to this SECTION 5.3 and other provisions of this Agreement
after the Distribution Date, each party agrees to use its reasonable commercial
efforts to retain all tax, employee and financial Information in their
respective possession or control on the Distribution Date for seven years after
the Distribution Date.
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No party will destroy, or permit any of its Subsidiaries to destroy, any
Information that exists on the Separation Date (other than Information that is
permitted to be destroyed under the current record retention policy of such
party) without first using its reasonable commercial efforts to notify the other
party of the proposed destruction and giving the other party the opportunity to
take possession of such Information prior to such destruction.
(d) LIMITATION OF LIABILITY. No party shall have any liability to any
other party in the event that any Information exchanged or provided pursuant to
this SECTION 5.3 is found to be inaccurate, in the absence of willful misconduct
by the party providing such Information. No party shall have any liability to
any other party if any Information is destroyed or lost after reasonable
commercial efforts by such party to comply with the provisions of SECTION
5.3(c).
(e) OTHER AGREEMENTS PROVIDING FOR EXCHANGE OF INFORMATION. The rights
and obligations granted under this SECTION 5.3 are subject to any specific
limitations, qualifications or additional provisions on the sharing, exchange or
confidential treatment of Information set forth in this Agreement and any
Ancillary Agreement.
(f) PRODUCTION OF WITNESSES; RECORDS; COOPERATION. After the
Distribution Date, except in the case of a legal or other proceeding by one
party against another party (which shall be governed by such discovery rules as
may be applicable under SECTION 5.7 or otherwise), each party hereto shall use
its reasonable commercial efforts to make available to each other party, upon
written request, the former, current and future directors, officers, employees,
other personnel and agents of such party as witnesses and any books, records or
other documents within its control or which it otherwise has the ability to make
available, to the extent that any such person (giving consideration to business
demands of such directors, officers, employees, other personnel and agents) or
books, records or other documents may reasonably be required in connection with
any legal, administrative or other proceeding in which the requesting party may
from time to time be involved, regardless of whether such legal, administrative
or other proceeding is a matter with respect to which indemnification may be
sought hereunder. The requesting party shall bear all costs and expenses in
connection therewith.
SECTION 5.4 AUDITORS AND AUDITS; ANNUAL AND QUARTERLY STATEMENTS AND
ACCOUNTING. Each party agrees that, for so long as Adaptec is required in
accordance with GAAP to consolidate Roxio's results of operations and financial
position in Adaptec's financial statements:
(a) SELECTION OF AUDITORS. Roxio shall not select a different
accounting firm than PricewaterhouseCoopers, LLP to serve as its (and its
Subsidiaries') independent certified public accountants ("ROXIO'S AUDITORS") for
purposes of providing an opinion on its consolidated financial statements
without Adaptec's prior written consent (which shall not be unreasonably
withheld).
(b) DATE OF AUDITORS' OPINION AND QUARTERLY REVIEWS. Roxio shall use
its reasonable commercial efforts to enable the Roxio Auditors to complete their
audit such that they will date their opinion on Roxio's audited annual financial
statements on the same date that Adaptec's independent certified public
accountants ("ADAPTEC'S AUDITORS") date their opinion on Adaptec's audited
annual financial statements, and to enable Adaptec to meet its timetable for the
printing, filing and public dissemination of Adaptec's annual financial
statements. Roxio shall use its reasonable commercial
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efforts to enable the Roxio Auditors to complete their quarterly review
procedures such that they will provide clearance on Roxio's quarterly financial
statements on the same date that Adaptec's Auditors provide clearance on
Adaptec's quarterly financial statements.
(c) ANNUAL AND QUARTERLY FINANCIAL STATEMENTS. Roxio shall provide to
Adaptec on a timely basis all Information that Adaptec reasonably requires to
meet its schedule for the preparation, printing, filing, and public
dissemination of Adaptec's annual and quarterly financial statements. Without
limiting the generality of the foregoing, Roxio will provide all required
financial Information with respect to Roxio and its Subsidiaries to Roxio's
Auditors in a sufficient and reasonable time and in sufficient detail to permit
Roxio's Auditors to take all steps and perform all reviews necessary to provide
sufficient assistance to Adaptec's Auditors with respect to Information to be
included or contained in Adaptec's annual and quarterly financial statements.
Similarly, Adaptec shall provide to Roxio on a timely basis all Information that
Roxio reasonably requires to meet its schedule for the preparation, printing,
filing, and public dissemination of Roxio's annual and quarterly financial
statements. Without limiting the generality of the foregoing, Adaptec will
provide all required financial Information with respect to Adaptec and its
Subsidiaries to Adaptec's Auditors in a sufficient and reasonable time and in
sufficient detail to permit Adaptec's Auditors to take all steps and perform all
reviews necessary to provide sufficient assistance to Roxio's Auditors with
respect to Information to be included or contained in Roxio's annual and
quarterly financial statements.
(d) IDENTITY OF PERSONNEL PERFORMING THE ANNUAL AUDIT AND QUARTERLY
REVIEWS. Roxio shall authorize Roxio's Auditors to make available to Adaptec's
Auditors both the personnel who performed or are performing the annual audits
and quarterly reviews of Roxio and work papers related to the annual audits and
quarterly reviews of Roxio, in all cases within a reasonable time prior to
Roxio's Auditors' opinion date, so that Adaptec's Auditors are able to perform
the procedures they consider necessary to take responsibility for the work of
Roxio's Auditors as it relates to Adaptec's Auditors' report on Adaptec's
financial statements, all within sufficient time to enable Adaptec to meet its
timetable for the printing, filing and public dissemination of Adaptec's annual
and quarterly statements. Similarly, Adaptec shall authorize Adaptec's Auditors
to make available to Roxio's Auditors both the personnel who performed or are
performing the annual audits and quarterly reviews of Adaptec and work papers
related to the annual audits and quarterly reviews of Adaptec, in all cases
within a reasonable time prior to Adaptec's Auditors' opinion date, so that
Roxio's Auditors are able to perform the procedures they consider necessary to
take responsibility for the work of Adaptec's Auditors as it relates to Roxio's
Auditors' report on Roxio's statements, all within sufficient time to enable
Roxio to meet its timetable for the printing, filing and public dissemination of
Roxio's annual and quarterly financial statements.
(e) ACCESS TO BOOKS AND RECORDS. Roxio shall provide Adaptec's
internal auditors and their designees access to Roxio's and its Subsidiaries'
books and records so that Adaptec may conduct reasonable audits relating to the
financial statements provided by Roxio pursuant hereto as well as to the
internal accounting controls and operations of Roxio and its Subsidiaries.
Similarly, Adaptec shall provide Roxio's internal auditors and their designees
access to Adaptec's and its Subsidiaries' books and records so that Roxio may
conduct reasonable audits relating to the financial statements provided by
Adaptec pursuant hereto as well as to the internal accounting controls and
operations of Adaptec and its Subsidiaries.
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(f) NOTICE OF CHANGE IN ACCOUNTING PRINCIPLES. Roxio shall give
Adaptec as much prior notice as reasonably practical of any proposed
determination of, or any significant changes in, its accounting estimates or
accounting principles from those in effect on the Separation Date. Roxio will
consult with Adaptec and, if requested by Adaptec, Roxio will consult with
Adaptec's independent public accountants with respect thereto. Adaptec shall
give Roxio as much prior notice as reasonably practical of any proposed
determination of, or any significant changes in, its accounting estimates or
accounting principles from those in effect on the Separation Date.
(g) CONFLICT WITH THIRD-PARTY AGREEMENTS. Nothing in SECTIONS 5.3 and
5.4 shall require Roxio to violate any agreement with any third parties
regarding the confidentiality of confidential and proprietary Information
relating to that third party or its business; PROVIDED, HOWEVER, that in the
event that Roxio is required under SECTIONS 5.3 AND 5.4 to disclose any such
Information, Roxio shall use all commercially reasonable efforts to seek to
obtain such customer's consent to the disclosure of such Information.
SECTION 5.5 CONSISTENCY WITH PAST PRACTICES. At all times prior to the
Separation Date, Adaptec will cause the Roxio Business to continue to ship
products, invoice customers, make payments, maintain properties, manage
distribution channels and otherwise conduct business in the ordinary course,
consistent with past practices.
SECTION 5.6 PAYMENT OF EXPENSES. Except as otherwise provided in this
Agreement, the Ancillary Agreements or any other agreement between the parties
relating to the Separation, the IPO or the Distribution, all costs and expenses
of the parties hereto in connection with the IPO (including underwriting
discounts and commissions but excluding internal costs, fees and expenses of
Adaptec) shall be paid by Roxio and all costs and expenses of the parties hereto
in connection with the Separation and Distribution (excluding internal costs,
fees and expenses of Roxio) shall be paid by Adaptec.
SECTION 5.7 DISPUTE RESOLUTION. Resolution of any and all disputes, claims
and causes of action of any nature whatsoever (collectively, "DISPUTES"),
arising from or in connection with this Agreement, shall be exclusively governed
by and settled in accordance with the provisions of this SECTION 5.7.
(a) NEGOTIATION. The parties shall make a good faith attempt to
resolve any Dispute arising out of or relating to this Agreement through
informal negotiation between appropriate representatives from each of Adaptec
and Roxio. If at any time either party feels that such negotiations are not
leading to a resolution of the Dispute, such party may send a notice to the
other party describing the Dispute and requesting a meeting of the senior
executives from each party. Within ten (10) business days after such notice is
given, each party shall select appropriate senior executives (e.g., director or
V.P. level) of each party who shall have the authority to resolve the matter and
shall meet to attempt in good faith to negotiate a resolution of the Dispute
prior to pursuing other available remedies. During the course of negotiations
under this SECTION 5.7(a), all reasonable requests made by one party to the
other for information, including requests for copies of relevant documents, will
be honored. The specific format for such negotiations will be left to the
discretion of the designated negotiating senior executives but may include the
preparation of agreed upon statements of fact or written statements of position
furnished to the other party. In the event
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that any Dispute arising out of or related to this Agreement is not settled by
the parties within thirty (30) days after the first meeting of the negotiating
senior executives, either party may commence litigation with respect to the
Dispute. However, except as provided below in SECTION 5.7(b), neither party
shall commence litigation against the other party to resolve the Dispute (i)
until the parties try in good faith to settle the Dispute by negotiation for at
least thirty (30) days after the first meeting of the negotiating senior
executives or (ii) until forty (40) days after notice of a Dispute is given by
either party to the other party, whichever occurs first.
(b) PROCEEDINGS. Any Dispute regarding the following is not required
to be negotiated prior to seeking relief from a court of competent jurisdiction:
breach of any obligation of confidentiality; infringement, misappropriation, or
misuse of any intellectual property right; or any other claim where interim
relief from the court is sought to prevent serious and irreparable injury to a
party. However, the parties shall make a good faith effort to negotiate such
Dispute, according to SECTION 5.7(a), while such court action is pending.
(c) CONTINUITY OF SERVICE AND PERFORMANCE. Unless otherwise agreed in
writing, the parties will continue to provide service and honor all other
commitments under this Agreement and each Ancillary Agreement during the course
of dispute resolution pursuant to the provisions of this SECTION 5.7 with
respect to all matters not subject to such dispute, controversy or claim.
SECTION 5.8 GOVERNMENTAL APPROVALS. To the extent that the Separation
requires any Governmental Approvals, the parties will use their reasonable
commercial efforts to obtain any such Governmental Approvals.
SECTION 5.9 REPRESENTATIONS AND WARRANTIES. Adaptec hereby represents and
warrants as follows:
(a) ORGANIZATION, GOOD STANDING AND QUALIFICATION. Adaptec, Adaptec
Manufacturing Singapore and each of the Transferred Subsidiaries are
corporations duly organized, validly existing and in good standing under the
laws of the respective jurisdictions under which they are incorporated and have
all requisite corporate power and authority to carry on their business as
currently conducted. Adaptec, Adaptec Manufacturing Singapore and each of the
Transferred Subsidiaries are duly qualified to transact business and are in good
standing in each jurisdiction in which the failure to so qualify would have a
material adverse effect on the Roxio Business.
(c) CORPORATE POWER. Each of Adaptec, and Adaptec Manufacturing
Singapore, as applicable, has all requisite legal and corporate power to (i)
execute and deliver this Agreement, the Ancillary Agreements and all applicable
exhibits and schedules attached hereto and thereto at such times as are
contemplated by this Agreement and the Ancillary Agreements; and (ii) perform
its obligations hereunder and thereunder.
(d) NO OTHER REPRESENTATIONS OR WARRANTIES. Adaptec does not, in this
Agreement or any other agreement, instrument or document contemplated by this
Agreement, make any representation as to, warranty of or covenant with respect
to:
(i) the value of any asset or thing of value to be transferred to
Roxio;
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(ii) the freedom from encumbrance of any asset or thing of value
to be transferred to Roxio;
(iii) the absence of defenses or freedom from counterclaims with
respect to any claim to be transferred to Roxio; or
(iv) the legal sufficiency of any assignment, document or
instrument delivered hereunder to convey title to any asset or thing of value
upon its execution, delivery and filing.
(e) RISK ASSOCIATED WITH TRANSFERRED ASSETS. Except as may expressly
be set forth herein or in any Ancillary Agreement, all assets to be transferred
to Roxio shall be transferred "AS IS, WHERE IS" and Roxio shall bear the
economic and legal risk that any conveyance shall prove to be insufficient to
vest in Roxio good and marketable title, free and clear of any lien, claim,
equity or other encumbrance.
SECTION 5.10 COOPERATION IN OBTAINING NEW AGREEMENTS. Adaptec understands
that, prior to the Separation Date, Roxio has derived benefits under certain
agreements between Adaptec and third parties, which agreements are not being
assigned to Roxio in connection with the Separation. Upon the request of Roxio,
Adaptec agrees to make introductions to appropriate Roxio personnel to Adaptec's
contacts at such third parties, and agrees to provide reasonable assistance to
Roxio, at Adaptec's own expense, so that Roxio may obtain agreements from such
third parties under substantially equivalent terms and conditions, including
financial terms and conditions, that apply to Adaptec. Such assistance may
include, but is not limited to, (i) requesting and encouraging such third
parties to enter into such agreements with Roxio, (ii) attending meetings and
negotiating sessions with Roxio and such third parties, and (iii) participating
in buying consortiums with Roxio. Adaptec also understands that there are
certain agreements between Adaptec and third parties, which agreements are being
assigned to Roxio in connection with the Separation but which may require the
consent of the applicable third party. Upon the request of Roxio, Adaptec agrees
to assist Roxio in seeking and obtaining the consent of such third parties to
such assignment. The parties expect that the activities contemplated by this
SECTION 5.10 will be substantially completed by the Distribution Date, but in no
event will Adaptec have any obligations hereunder after the first anniversary of
the Distribution Date.
SECTION 5.11 PROPERTY DAMAGE TO ROXIO ASSETS PRIOR TO THE SEPARATION DATE.
In the event of any property damage to any Roxio Assets prior to the Separation
Date, Adaptec shall repair or otherwise address such damage in the ordinary
course of business consistent with past practices; PROVIDED, HOWEVER, that
nothing in this clause shall restrict Adaptec from disposing of any Assets in
the ordinary course of business consistent with past practices.
SECTION 5.12 ASSET TRANSFERS IN CONNECTION WITH SEPARATION. Adaptec
shall use its best efforts to have Adaptec Mfg (S) Pte Ltd. ("AMS"), a
Singapore corporation, transfer to Roxio CI Ltd., a Cayman Island
corporation, prior to the Separation Date, all of AMS's interest in any
intellectual property relating to the Roxio Business owned by AMS and AMS's
ownership of CG1 GmbH, a German corporation, pursuant to the International
Transfer of Assets Agreement substantially in the form attached hereto as
EXHIBIT M.
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ARTICLE VI
MISCELLANEOUS
SECTION 6.1 LIMITATION OF LIABILITY. IN NO EVENT SHALL ANY MEMBER OF THE
ADAPTEC GROUP OR ROXIO GROUP BE LIABLE TO ANY OTHER MEMBER OF THE ADAPTEC GROUP
OR ROXIO GROUP FOR ANY SPECIAL, CONSEQUENTIAL, INDIRECT, INCIDENTAL OR PUNITIVE
DAMAGES OR LOST PROFITS, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY
(INCLUDING NEGLIGENCE) ARISING IN ANY WAY OUT OF THIS AGREEMENT, WHETHER OR NOT
SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES; PROVIDED,
HOWEVER, THAT THE FOREGOING LIMITATIONS SHALL NOT LIMIT EACH PARTY'S
INDEMNIFICATION OBLIGATIONS FOR LIABILITIES TO THIRD PARTIES AS SET FORTH IN THE
INDEMNIFICATION AND INSURANCE MATTERS AGREEMENT.
SECTION 6.2 ENTIRE AGREEMENT. This Agreement, the other Ancillary
Agreements and the Exhibits and Schedules referenced or attached hereto and
thereto, constitute the entire agreement between the parties with respect to the
subject matter hereof and shall supersede all prior written and oral and all
contemporaneous oral agreements and understandings with respect to the subject
matter hereof.
SECTION 6.3 GOVERNING LAW. This Agreement shall be construed in accordance
with and all Disputes hereunder shall be governed by the laws of the State of
California, excluding its conflict of law rules and the United Nations
Convention on Contracts for the International Sale of Goods. The Superior Court
of Santa Xxxxx County and/or the United States District Court for the Northern
District of California, San Xxxx Division, shall have jurisdiction and venue
over all Disputes between the parties that are permitted to be brought in a
court of law pursuant to SECTION 5.7 above.
SECTION 6.4 TERMINATION. This Agreement and all Ancillary Agreements may be
terminated and the Distribution abandoned at any time prior to the IPO Closing
Date by and in the sole discretion of Adaptec without the approval of Roxio.
This Agreement may be terminated at any time after the IPO Closing Date and
before the Distribution Date by mutual consent of Adaptec and Roxio. In the
event of termination pursuant to this SECTION 6.4, no party shall have any
liability of any kind to the other party.
SECTION 6.5 NOTICES. Any notice, demand, offer, request or other
communication required or permitted to be given by either party pursuant to the
terms of this Agreement shall be in writing and shall be deemed effectively
given the earlier of (i) when received, (ii) when delivered personally, (iii)
one (1) Business Day after being deposited with a nationally recognized
overnight courier service or (iv) four (4) days after being deposited in the
U.S. mail, First Class with postage prepaid, and addressed to the attention of:
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IF TO ADAPTEC, INC.:
Adaptec, Inc.
000 X. Xxxxxxxx Xxxx.
Xxxxxxxx, XX 00000
Attention: Vice President and General Counsel
with a copy to:
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, Professional Corporation
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, XX 00000-0000
Attention: Xxxxx X. Xxxxxx, Xx.
IF TO ROXIO, INC.:
Roxio, Inc.
000 Xxxxx Xxxxxxxx Xxxx.
Xxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxxxx Xxxxx
with a copy to:
Xxxx Xxxx Xxxx & Freidenrich LLP
000 Xxxxxxx Xxxx, Xxxxx 0000
Xxxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxx
Adaptec and Roxio may substitute a different address, from time to time, if such
substitute is provided to the intended notice recipient in writing by notice
given in the manner provided in this SECTION 6.5.
SECTION 6.6 COUNTERPARTS. This Agreement, including the Schedules and
Exhibits hereto and the other documents referred to herein, may be executed via
facsimile or otherwise in counterparts, each of which shall be deemed to be an
original but all of which shall constitute one and the same agreement.
SECTION 6.7 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, 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. This Agreement may
be enforced separately by each member of the Adaptec Group and each member of
the Roxio Group. Except as herein specifically provided to the contrary, neither
party may assign this Agreement or any rights or obligations hereunder, without
the prior written consent of the other party, and any such assignment shall be
void; provided, however, either party (or its permitted successive assignees or
transferees hereunder) may assign or transfer this Agreement as a whole without
consent to an entity
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that succeeds to all or substantially all of the business or assets of such
party to which this Agreement relates.
SECTION 6.8 SEVERABILITY. The parties hereto have negotiated and prepared
the terms of this Agreement in good faith with the intent that each and every
one of the terms, covenants and conditions herein be binding upon and inure to
the benefit of the respective parties. Accordingly, if any one or more of the
terms, provisions, promises, covenants or conditions of this Agreement or the
application thereof to any person or circumstance shall be adjudged to any
extent invalid, unenforceable, void or voidable for any reason whatsoever by a
court of competent jurisdiction, such provision shall be as narrowly construed
as possible, and each and all of the remaining terms, provisions, promises,
covenants and conditions of this Agreement or their application to other persons
or circumstances shall not be affected thereby and shall be valid and
enforceable to the fullest extent permitted by law. To the extent this Agreement
is in violation of applicable law, then the parties agree to negotiate in good
faith to amend the Agreement, to the extent possible consistent with its
purposes, to conform to law.
SECTION 6.9 WAIVER OF BREACH. The waiver by either party hereto of a breach
or violation of any provision of this Agreement shall not operate as, or be
construed to constitute, a waiver of any subsequent breach of the same or
another provision hereof.
SECTION 6.10 AMENDMENT AND EXECUTION. This Agreement and amendments hereto
shall be in writing and executed in multiple copies via facsimile or otherwise
on behalf of Adaptec and Roxio by their respective duly authorized officers and
representatives. Each multiple copy shall be deemed an original, but all
multiple copies together shall constitute one and the same instrument.
SECTION 6.11 AUTHORITY. Each of the parties hereto represents to the other
that (a) it has the corporate or other requisite power and authority to execute,
deliver and perform this Agreement, (b) the execution, delivery and performance
of this Agreement by it have been duly authorized by all necessary corporate or
other actions, (c) it has duly and validly executed and delivered this
Agreement, and (d) this Agreement is a legal, valid and binding obligation,
enforceable against it in accordance with its terms subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and general equity principles.
SECTION 6.12 DESCRIPTIVE HEADINGS. The headings contained in this
Agreement, in any Exhibit or Schedule hereto and in the table of contents to
this Agreement are for reference purposes only and shall not affect in any way
the meaning or interpretation of this Agreement. Any capitalized term used in
any Schedule or Exhibit but not otherwise defined therein, shall have the
meaning assigned to such term in this Agreement. When a reference is made in
this Agreement to an Article or a Section, Exhibit or Schedule, such reference
shall be to an Article or Section of, or an Exhibit or Schedule to, this
Agreement unless otherwise indicated.
SECTION 6.13 GENDER AND NUMBER. Whenever the context of this Agreement
requires, the gender of all words herein shall include the masculine, feminine
and neuter, and the number of all words herein shall include the singular and
plural.
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SECTION 6.14 ADDITIONAL ASSURANCES. Except as may be specifically provided
herein to the contrary, the provisions of this Agreement shall be self-operative
and shall not require further agreement by the parties; provided, however, at
the request of either party, the other party shall execute such additional
instruments and take such additional acts as are reasonable, and as the
requesting party may reasonably deem necessary, to effectuate this Agreement.
SECTION 6.15 FORCE MAJEURE. Neither party shall be liable or deemed to be
in default for any delay or failure in performance under this Agreement or other
interruption of service deemed to result, directly or indirectly, from acts of
God, civil or military authority, acts of public enemy, war, accidents,
explosions, earthquakes, floods, failure of transportation, strikes or other
work interruptions by either party's employees, or any other similar cause
beyond the reasonable control of either party unless such delay or failure in
performance is expressly addressed elsewhere in this Agreement.
SECTION 6.16 CONFLICTING AGREEMENTS. In the event of conflict between this
Agreement and any Ancillary Agreement or other agreement executed in connection
herewith, the provisions of such other agreement shall prevail.
ARTICLE VII
DEFINITIONS
SECTION 7.1 ADAPTEC BUSINESS. "ADAPTEC BUSINESS" means any business of
Adaptec other than the Roxio Business.
SECTION 7.2 ADAPTEC GROUP. "ADAPTEC GROUP" means Adaptec and each
Subsidiary of Adaptec (other than any member of the Roxio Group) immediately
after the Separation Date, and each Person that becomes a Subsidiary of Adaptec
after the Separation Date.
SECTION 7.3 ADAPTEC'S AUDITORS. "ADAPTEC'S AUDITORS" has the meaning set
forth in Section 5.4(b) hereof.
SECTION 7.4 ANCILLARY AGREEMENTS. "ANCILLARY AGREEMENTS" has the meaning
set forth in Section 2.1 hereof.
SECTION 7.5 ASSIGNMENT AGREEMENT. "ASSIGNMENT AGREEMENT" has the meaning
set forth in Section 2.1(a) hereof.
SECTION 7.6 BUSINESS DAY. "BUSINESS DAY" means a day other than a Saturday,
a Sunday or a day on which banking institutions located in the State of
California are authorized or obligated by law or executive order to close.
SECTION 7.7 CODE. "CODE" has the meaning set forth in the Recitals hereof.
SECTION 7.8 COMMISSION. "COMMISSION" has the meaning set forth in Section
3.1(a) hereof.
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SECTION 7.9 DISPUTES. "Disputes" has the meaning set forth in Section 5.7
hereof.
SECTION 7.10 DISTRIBUTION. "Distribution" has the meaning set forth in the
Recitals hereof.
SECTION 7.11 DISTRIBUTION AGENT. "Distribution Agent" has the meaning set
forth in Section 4.1 hereof.
SECTION 7.12 DISTRIBUTION DATE. "Distribution Date" has the meaning set
forth in Section 4.1 hereof.
SECTION 7.13 EXCHANGE ACT. "EXCHANGE ACT" has the meaning set forth in
Section 3.1(a) hereof.
SECTION 7.14 GAAP. "GAAP" means generally accepted accounting principals
promulgated by the Financial Accounting Standards Board, in effect on the
Separation Date, consistently applied.
SECTION 7.15 GOVERNMENTAL APPROVALS. "GOVERNMENTAL APPROVALS" means any
notices, reports or other filings to be made, or any consents, registrations,
approvals, permits or authorizations to be obtained from, any Governmental
Authority.
SECTION 7.16 GOVERNMENTAL AUTHORITY. "GOVERNMENTAL AUTHORITY" shall mean
any federal, state, local, foreign or international court, government,
department, commission, board, bureau, agency, official or other regulatory,
administrative or governmental authority.
SECTION 7.17 XXXX XXXX. "XXXX XXXX" has the meaning set for in Section 1.2
hereof.
SECTION 7.18 INFORMATION. "Information" means information, whether or not
patentable or copyrightable, in written, oral, electronic or other tangible or
intangible forms, stored in any medium, including studies, reports, records,
books, contracts, instruments, surveys, discoveries, ideas, concepts, know-how,
techniques, designs, specifications, drawings, blueprints, diagrams, models,
prototypes, samples, flow charts, data, computer data, disks, diskettes, tapes,
computer programs or other software, marketing plans, customer names,
communications by or to attorneys (including attorney-client privileged
communications), memos and other materials prepared by attorneys or under their
direction (including attorney work product), and other technical, financial,
employee or business information or data.
SECTION 7.19 IPO. "IPO" has the meaning set forth in the Recitals hereof.
SECTION 7.20 IPO CLOSING DATE. "IPO Closing Date" means the date on which
the IPO closes.
SECTION 7.21 IPO NET PROCEEDS. "IPO Net Proceeds" means the proceeds
received by Roxio upon closing of the IPO (including the proceeds from the sale
of shares pursuant to the exercise of the Underwriters' over-allotment option)
net of underwriting discounts and commissions.
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SECTION 7.22 IPO REGISTRATION STATEMENT. "IPO REGISTRATION STATEMENT" has
the meaning set forth in the Recitals hereof.
SECTION 7.23 NASDAQ. "Nasdaq" has the meaning set for in Section 3.1(e)
hereof.
SECTION 7.24 PERSON. "PERSON" means an individual, a partnership, a
corporation, a limited liability company, an association, a joint stock company,
a trust, a joint venture, an unincorporated organization and a governmental
entity or any department, agency or political subdivision thereof.
SECTION 7.25 PRIME RATE. "PRIME RATE" means the prime lending rate as
published in the Wall Street Journal, Western Edition, on the date of
determination.
SECTION 7.26 RECORD DATE. "RECORD DATE" means the close of business on the
date to be determined by the Board of Directors of Adaptec as the record date
for determining the stockholders of Adaptec entitled to receive shares of common
stock of Roxio in the Distribution.
SECTION 7.27 ROXIO ASSETS. "ROXIO ASSETS" has the meaning set forth in
Section 1.2 of the Assignment Agreement.
SECTION 7.28 ROXIO'S AUDITORS. "ROXIO'S AUDITORS" has the meaning set forth
in Section 5.4(a) hereof.
SECTION 7.29 ROXIO BUSINESS. "ROXIO BUSINESS" means (a) the business and
operations of Adaptec currently operated as the Software Products Group, as
described in the IPO Registration Statement including, without limitation, the
business and operation responsible for developing, marketing, and selling the
following products (i) Easy CD Creator, (ii) GoBack, (iii) SoundStream, (vi)
Toast, (v) Jam, (vi) TakeTwo and (vii) WinOnCD and (b) except as otherwise
expressly provided herein, any terminated, divested or discontinued businesses
or operations that at the time of termination, divestiture or discontinuation
primarily related to the Roxio Business as then conducted.
SECTION 7.30 ROXIO GROUP. "ROXIO GROUP" means Roxio and each Subsidiary of
Roxio immediately after the Separation Date and each Person that becomes a
Subsidiary of Roxio after the Separation Date.
SECTION 7.31 SEPARATION. "Separation" has the meaning set forth in the
Recitals hereof.
SECTION 7.32 SEPARATION DATE. "Separation Date" has the meaning set forth
in Section 1.1 hereof.
SECTION 7.33 SUBSIDIARY. "SUBSIDIARY" means with respect to any specified
Person, any corporation, any limited liability company, any partnership or other
legal entity of which such Person or its Subsidiaries owns, directly or
indirectly, more than 50% of the stock or other equity interest entitled to vote
on the election of the members of the board of directors or similar governing
body. Unless context otherwise requires, reference to Adaptec and its
Subsidiaries shall not include the subsidiaries of Adaptec that will be
transferred to Roxio after giving effect to the Separation.
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SECTION 7.34 TRANSFERRED SUBSIDIARY. "TRANSFERRED SUBSIDIARY" shall have
the meaning set forth in Section 2.1(b) hereof.
SECTION 7.35 TRANSITIONAL SERVICE SCHEDULES. "TRANSITIONAL SERVICE
SCHEDULES" shall have the meaning set forth in Article 2 of the Master
Transitional Services Agreement.
SECTION 7.36 UNDERWRITERS. "Underwriters" has the meaning set forth in
Section 3.1(a) hereof.
SECTION 7.37 UNDERWRITING AGREEMENT. "Underwriting Agreement" has the
meaning set forth in Section 3.1(a) hereof.
SECTION 7.38 WSGR. "WSGR" has the meaning set forth in Section 1.2 hereof.
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WHEREFORE, the parties have signed this Master Separation and
Distribution Agreement effective as of the date first set forth above.
ADAPTEC, INC. ROXIO, INC.
By: /s/ Xxxxxx X. Xxxxxxxx By: /s/ X.X. Xxxxx
---------------------- --------------
Name: Xxxxxx X. Xxxxxxxx Name: X.X. Xxxxx
---------------------- --------------
Title: President and CEO Title: CEO
---------------------- --------------
SCHEDULE 2.1(b)
SUBSIDIARIES OF ADAPTEC TO BE TRANSFERRED TO ROXIO
SUBSIDIARIES
WildFile, Inc.
Roxio CI Ltd. (which includes Roxio CI Ltd.'s interests in its subsidiaries,
which include Xxxxx XxX, Xxxxx Xxxxxxxxxxxxx XX, XX0 GmbH and CeQuadrat KG)
EXHIBIT A
CERTIFICATE OF SECRETARY OF ADAPTEC
As provided in the Master Separation and Distribution Agreement between
Adaptec, Inc., a Delaware corporation ("Adaptec"), and Roxio, Inc., a Delaware
corporation (the "Agreement"), the undersigned Secretary of Adaptec hereby
certifies that Adaptec directs Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, Professional
Corporation, to make the deliveries and receipts on behalf of Adaptec as
provided in Section 1.3 of the Agreement.
________________________________
Secretary
Dated:______________________, 2000
EXHIBIT B
CERTIFICATE OF SECRETARY OF ROXIO
As provided in the Master Separation and Distribution Agreement between
Adaptec, Inc., a Delaware corporation, and Roxio, Inc., a Delaware corporation
("Roxio") (the "Agreement"), the undersigned Secretary of Roxio hereby certifies
that Roxio directs Xxxx Xxxx Xxxx & Freidenrich LLP to make the deliveries and
receipts on behalf of Roxio as provided in Section 1.3 of the Agreement.
________________________________
Secretary
Dated:______________________, 2000
EXHIBIT C
GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT
EXHIBIT D-1
MASTER TECHNOLOGY OWNERSHIP AND LICENSE AGREEMENT
EXHIBIT D-2
MASTER PATENT OWNERSHIP AND LICENSE AGREEMENT
EXHIBIT E
EMPLOYEE MATTERS AGREEMENT
EXHIBIT F
TAX SHARING AGREEMENT
EXHIBIT G
REAL ESTATE AGREEMENT
EXHIBIT H
MASTER CONFIDENTIAL DISCLOSURE AGREEMENT
EXHIBIT I
INDEMNIFICATION AND INSURANCE MATTERS AGREEMENT
EXHIBIT J
MANUFACTURING AGREEMENT
EXHIBIT K
MASTER TRANSITIONAL SERVICES AGREEMENT
EXHIBIT L
BRIDGE LOAN PROMISSORY NOTE
EXHIBIT M
INTERNATIONAL TRANSFER OF ASSETS AGREEMENT
