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Exhibit 2.1
FORM OF
SEPARATION AND DISTRIBUTION AGREEMENT
BY AND AMONG
ALLEGHENY TELEDYNE INCORPORATED,
TII HOLDINGS, LLC,
TELEDYNE INDUSTRIES, INC.
AND
TELEDYNE TECHNOLOGIES INCORPORATED
DATED AS OF ___________, 1999
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Table of Contents
Page
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ARTICLE I DEFINITIONS.........................................................................................2
ARTICLE II THE SEPARATION.....................................................................................13
2.01. Transfer of Assets and Assumption of Liabilities...................................................13
2.02. Teledyne Technologies Assets.......................................................................14
2.03. Teledyne Technologies Liabilities..................................................................14
2.04. Termination of Agreements..........................................................................16
2.05. Documents Relating to Transfer of Real Property Interests
and Tangible Property Located Thereon..............................................................17
2.06. Documents Further Evidencing Transfers of Assets and Assumption of Liabilities.....................17
2.07. Other Ancillary Agreements.........................................................................17
2.08. Disclaimer of Representations and Warranties.......................................................17
2.09. Financing Arrangements.............................................................................18
2.10. Governmental Approvals and Consents................................................................18
2.11. Novation of Assumed Teledyne Technologies Liabilities..............................................19
2.12. Transfer of Xxxxx Assets and Assumption of Xxxxx Liabilities.......................................20
2.13. Consummation of Purchase and Sale Agreements; Interim Contribution.................................20
2.14. TI Contribution and Liquidation....................................................................20
2.15. Interim Distributions..............................................................................20
ARTICLE III THE DISTRIBUTION...................................................................................21
3.01. The Distribution...................................................................................21
3.02. Actions Prior to the Distribution..................................................................21
3.03. Fractional Shares..................................................................................22
ARTICLE IV THE PUBLIC OFFERING................................................................................22
4.01. The Public Offering................................................................................22
4.02. Proceeds of the Public Offering....................................................................23
4.03. Remedies...........................................................................................23
ARTICLE V MUTUAL RELEASES; INDEMNIFICATION...................................................................23
5.01. Release of Pre-Distribution Claims.................................................................23
5.02. Indemnification by Teledyne Technologies...........................................................26
5.03. Indemnification by ATI.............................................................................27
5.04. Indemnification Obligations Net of Insurance Proceeds and other Amounts............................27
5.05. Procedures for Indemnification of Third Party Claims...............................................27
5.06. Additional Matters.................................................................................28
5.07. Remedies Cumulative................................................................................29
5.08. Survival of Indemnities............................................................................29
ARTICLE VI CERTAIN OTHER MATTERS..............................................................................30
6.01. Insurance Matters..................................................................................30
6.02. Certain Business Matters...........................................................................32
6.03. Late Payments......................................................................................32
6.04. Certain Governance Matters.........................................................................32
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ARTICLE VIII EXCHANGE OF INFORMATION; CONFIDENTIALITY...........................................................33
7.01. Agreement for Exchange of Information; Archives....................................................33
7.02. Ownership of Information...........................................................................33
7.03. Compensation for Providing Information.............................................................33
7.04. Record Retention...................................................................................34
7.05. Other Agreements Providing For Exchange of Information.............................................34
7.06. Production of Witnesses; Records; Cooperation......................................................34
7.07. Confidentiality....................................................................................35
7.08. Protective Arrangements............................................................................36
ARTICLE VIII FURTHER ASSURANCES.................................................................................36
8.01. Further Assurances.................................................................................36
ARTICLE IX TERMINATION........................................................................................37
9.01. Termination........................................................................................37
9.02. Effect of Termination..............................................................................37
ARTICLE X MISCELLANEOUS......................................................................................37
10.01. Counterparts; Entire Agreement; Corporate Power....................................................37
10.02. Governing Law; Consent to Jurisdiction.............................................................38
10.03. Assignability......................................................................................38
10.04. Third Party Beneficiaries..........................................................................39
10.05. Notices............................................................................................39
10.06. Severability.......................................................................................39
10.07. Force Majeure......................................................................................40
10.09. Headings...........................................................................................40
10.10. Survival of Covenants..............................................................................40
10.11. Waivers of Default.................................................................................40
10.12. Specific Performance...............................................................................40
10.13. Amendments.........................................................................................41
10.14. Interpretation.....................................................................................41
10.15. Disputes...........................................................................................42
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SEPARATION AND DISTRIBUTION AGREEMENT
THIS SEPARATION AND DISTRIBUTION AGREEMENT, dated as of
____________, 1999, is by and among Allegheny Teledyne Incorporated, a Delaware
corporation ("ATI"), TII Holdings, LLC, a Delaware limited liability company the
sole member of which is ATI ("Holdings"), Teledyne Industries, Inc., a
California corporation and an indirect wholly owned subsidiary of ATI ("TII"),
and Teledyne Technologies Incorporated, a Delaware corporation and wholly owned
subsidiary of TII ("Teledyne Technologies"). Capitalized terms used herein and
not otherwise defined shall have the respective meanings assigned to them in
Article I hereof.
WHEREAS, the Board of Directors of ATI has determined that it
is in the best interests of ATI and its stockholders to separate ATI's existing
businesses into three independent businesses; and
WHEREAS, in furtherance of the foregoing, it is appropriate
and desirable to transfer the Teledyne Technologies Assets to Teledyne
Technologies and to cause Teledyne Technologies to assume the Teledyne
Technologies Liabilities, all as more fully described in this Agreement and the
Ancillary Agreements; and
WHEREAS, ATI intends, subject to completion of the
transactions contemplated hereby (including the foregoing transfer of Teledyne
Technologies Assets and assumption of Teledyne Technologies Liabilities) and to
the other terms of this Agreement and to further action by its Board of
Directors, to effect the Distribution; and
WHEREAS, the Form 10 Registration Statement has become
effective under the Exchange Act; and
WHEREAS, ATI has received a private letter ruling from the
Internal Revenue Service to the effect that, among other things, the
Distribution will qualify as a tax-free distribution for federal income tax
purposes under Section 355 of the Code; and
WHEREAS, the Distribution is to be followed by the Public
Offering; and
WHEREAS, it is expected that, following certain transfers of
other Assets and assignments and assumptions of other Liabilities, ATI will
distribute to its stockholders all of the capital stock of Water Pik
Technologies, Inc. ("Water Pik") held directly or indirectly by ATI and that, in
connection therewith, ATI and Water Pik have entered into agreements, including
the Water Pik Separation and Distribution Agreement, to address matters relating
to the Water Pik Distribution; and
WHEREAS, it is appropriate and desirable to set forth the
principal corporate transactions required to effect the Separation, the
Distribution and the Public Offering and certain other agreements that will
govern certain matters relating to the Separation, the Distribution and
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the Public Offering and the relationships of ATI and Teledyne Technologies and
their respective Subsidiaries following the Separation and the Distribution;
NOW, THEREFORE, the parties, intending to be legally bound,
agree as follows:
ARTICLE I
DEFINITIONS
For the purpose of this Agreement the following terms shall
have the following meanings:
1.01. ACTION means any demand, action, suit, countersuit,
arbitration, inquiry, proceeding or investigation by or before any federal,
state, local, foreign or international Governmental Authority or any arbitration
or mediation tribunal.
1.02. AFFILIATE of any Person means a Person that controls, is
controlled by, or is under common control with such Person. As used herein,
"control" means the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of such entity, whether
through ownership of voting securities or other interests, by contract or
otherwise.
1.03. AGENT means the distribution agent to be appointed by
ATI to distribute to the stockholders of ATI the shares of Teledyne Technologies
Common Stock held by ATI pursuant to the Distribution.
1.04. AGREEMENT means this Separation and Distribution
Agreement, including all of the Schedules hereto.
1.05. ANCILLARY AGREEMENTS means the deeds, lease assignments
and assumptions, leases, subleases and sub-subleases, subscription or
contribution agreements, stock powers, and the supplemental and other agreements
and instruments related thereto contemplated by Article II, including the Xxxxx
Transfer and Assumption Agreement, the Purchase and Sale Agreements, the
Employee Benefits Agreement, the Interim Services Agreement, the Trademark
License Agreement, the Patent Assignments and related agreements regarding
powers of attorney and the Tax Sharing Agreement.
1.06. ASSETS means assets, properties and rights (including
goodwill), wherever located (including in the possession of vendors or other
third parties or elsewhere), whether real, personal or mixed, tangible,
intangible or contingent, in each case whether or not recorded or reflected or
required to be recorded or reflected on the books and records or financial
statements of any Person, including the following:
(a) all accounting and other books, records and files whether
in paper, microfilm, microfiche, computer tape or disc, magnetic tape
or any other form;
(b) all apparatus, computers and other electronic data
processing equipment, fixtures, machinery, equipment, furniture, office
equipment, automobiles, trucks, rolling
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stock, vessels, motor vehicles and other transportation equipment,
special and general tools, test devices, prototypes and models and
other tangible personal property;
(c) all inventories of materials, parts, raw materials,
supplies, work-in-process and finished goods and products;
(d) all interests in real property of whatever nature,
including easements, whether as owner, lessor, sublessor, lessee,
sublessee or otherwise;
(e) all interests in any capital stock or other equity
interests of any Subsidiary or any other Person, all bonds, notes,
debentures or other securities issued by any Subsidiary or any other
Person, all loans, advances or other extensions of credit or capital
contributions to any Subsidiary or any other Person and all other
investments in securities of any Person;
(f) all license agreements, leases of personal property, open
purchase orders for raw materials, supplies, parts or services,
unfilled orders for the manufacture and sale of products and other
contracts, agreements or commitments;
(g) all deposits, letters of credit and performance and surety
bonds;
(h) all written technical information, data, specifications,
research and development information, engineering drawings, operating
and maintenance manuals, and materials and analyses prepared by
consultants and other third parties;
(i) all domestic and foreign patents, copyrights, trade names,
trademarks, service marks and registrations and applications for any of
the foregoing, mask works, trade secrets, inventions, other proprietary
information and licenses from third Persons granting the right to use
any of the foregoing;
(j) all computer applications, programs and other software,
including operating software, network software, firmware, middleware,
design software, design tools, systems documentation and instructions;
(k) all cost information, sales and pricing data, customer
prospect lists, supplier records, customer and supplier lists, customer
and vendor data, correspondence and lists, product literature, artwork,
design, development and manufacturing files, vendor and customer
drawings, formulations and specifications, quality records and reports
and other books, records, studies, surveys, reports, plans and
documents;
(l) all prepaid expenses, trade accounts and other accounts
and notes receivables;
(m) all rights under contracts or agreements, all claims or
rights against any Person arising from the ownership of any Asset, all
rights in connection with any bids or offers and all related claims,
choses in action or similar rights, whether accrued or contingent;
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(n) all rights as a named insured under insurance policies and
all rights in the nature of insurance, indemnification or contribution;
(o) all licenses, permits, approvals and authorizations which
have been issued by any Governmental Authority;
(p) cash or cash equivalents, bank accounts, lock boxes and
other deposit agreements; and
(q) interest rate, currency, commodity or other swap, collar,
cap or other hedging or similar agreements or arrangements.
1.07. ATI AUTOMOBILE POLICIES means those ATI Policies that
(i) insure Teledyne Technologies or any other member of the Teledyne
Technologies Group, and (ii) provide automobile insurance.
1.08. ATI COMMON STOCK means the Common Stock, par value $0.10
per share, of ATI.
1.09. ATI GENERAL LIABILITY POLICIES means those ATI Policies
that (i) insure Teledyne Technologies or any other member of the Teledyne
Technologies Group, and (ii) provide general liability, public liability, or
comprehensive general liability insurance.
1.10. ATI GROUP means ATI and each Person (other than any
member of the Teledyne Technologies Group or the Water Pik Group) that is an
Affiliate of ATI immediately after the Effective Time.
1.11. ATI INDEMNITEES has the meaning set forth in Section
5.02.
1.12. ATI LIABILITIES means all Liabilities of ATI other than
Teledyne Technologies Liabilities and Water Pik Liabilities.
1.13. ATI POLICIES means policies of insurance that have been
issued to, or in favor of, ATI or Subsidiaries of ATI.
1.14. ATI PRODUCT LIABILITY POLICIES means those ATI Policies
that (i) insure Teledyne Technologies or any other member of the Teledyne
Technologies Group, and (ii) provide product liability insurance, other than
aircraft products liability insurance.
1.15. ATI WORKERS COMPENSATION POLICIES means those ATI
Policies that (i) insure Teledyne Technologies or any other member of the
Teledyne Technologies Group, and (ii) provide workers compensation insurance.
1.16. XXXXX means Teledyne Xxxxx Engineering, Inc., a Delaware
corporation and wholly owned subsidiary of Teledyne Technologies.
1.17. XXXXX ASSETS means those Assets described in Schedule
1.17.
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1.18. XXXXX LIABILITIES means those Liabilities described in
Schedule 1.18.
1.19. XXXXX TRANSFER AND ASSUMPTION AGREEMENT means the Asset
Transfer and Liabilities Assumption Agreement, dated as of the date hereof,
between Teledyne Technologies and Xxxxx.
1.20. CODE means the Internal Revenue Code of 1986, as
amended.
1.21. COMMISSION means the Securities and Exchange Commission.
1.22. CONSENTS means any consents, waivers or approvals from,
or notification requirements to, any third parties.
1.23. DESIGNATED OFFICERS means, (i) in the case of ATI, the
Senior Vice President, General Counsel and Secretary of ATI or his successor,
and (ii) in the case of Teledyne Technologies, _____________ or his successor.
1.24. DGCL means the Delaware General Corporation Law, as
amended.
1.25. DISPUTES has the meaning set forth in Section 10.14.
1.26. DISTRIBUTION means the distribution by ATI on a pro rata
basis to holders of ATI Common Stock of all of the outstanding shares of
Teledyne Technologies Common Stock.
1.27. DISTRIBUTION DATE means the date on which the
Distribution occurs.
1.28. EFFECTIVE TIME means 5:00 p.m., Eastern Standard Time or
Eastern Daylight Time (whichever shall be then in effect), on the Distribution
Date.
1.29. EMPLOYEE BENEFITS AGREEMENT means the Employee Benefits
Agreement, dated as of the date hereof, by and between ATI and Teledyne
Technologies.
1.30. ENVIRONMENTAL LAW means any federal, state, local,
foreign or international statute, ordinance, rule, regulation, code, license,
permit, authorization, approval, consent, common law (including tort and
environmental nuisance law), legal doctrine, order, judgment, decree,
injunction, requirement or agreement with any Governmental Authority, now or
hereafter in effect relating to health, safety, pollution or the environment
(including ambient air, surface water, groundwater, land surface or subsurface
strata) or to emissions, discharges, releases or threatened releases of any
substance currently or at any time hereafter listed, defined, designated or
classified as hazardous, toxic, waste, radioactive or dangerous, or otherwise
regulated, under any of the foregoing, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of any such substances, including the Comprehensive Environmental
Response, Compensation and Liability Act, the Superfund Amendments and
Reauthorization Act and the Resource Conservation and Recovery Act and
comparable provisions in state, local, foreign or international law.
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1.31. ENVIRONMENTAL LIABILITIES means all Liabilities relating
to, arising out of or resulting from any Environmental Law or contract or
agreement relating to environmental, health or safety matters (including all
removal, remediation or cleanup costs, investigatory costs, governmental
response costs, natural resources damages, property damages, personal injury
damages, costs of compliance with any settlement, judgment or other
determination of Liability and indemnity, contribution or similar obligations)
and all costs and expenses (including allocated costs of in-house counsel and
other personnel), interest, fines, penalties or other monetary sanctions in
connection therewith.
1.32. EXCHANGE ACT means the Securities Exchange Act of 1934,
as amended, together with the rules and regulations promulgated thereunder.
1.33. EXCLUDED ASSETS has the meaning set forth in Section
2.02(b).
1.34. EXPENSE FACTORS means expense factors or similar factors
or multipliers set forth in policies of insurance or related agreements
applicable to liabilities, losses or defense costs insured thereunder that are
subject to a Self-Insurance Obligation.
1.35. FINANCING FACILITY means ______________________________.
1.36. FORM 10 REGISTRATION STATEMENT means the registration
statement on Form 10 filed under the Exchange Act, pursuant to which Teledyne
Technologies Common Stock will be registered under the Exchange Act following
the Distribution, together with all amendments thereto.
1.37. 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.
1.38. 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.
1.39. GROUP means the ATI Group, the Teledyne Technologies
Group or the Water Pik Group, as the context requires.
1.40. INCURRED LOSSES means the sum of paid losses (indemnity
and loss adjustment expenses) and reserves for unpaid losses.
1.41. INDEMNIFYING PARTY has the meaning set forth in Section
5.04(a).
1.42. INDEMNITEE has the meaning set forth in Section 5.04(a).
1.43. INDEMNITY PAYMENT has the meaning set forth in Section
5.04(a).
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1.44. INDUSTRIES INTERNATIONAL means Teledyne Industries
International, Inc., a California corporation.
1.45. INDUSTRIES STOCK INTERESTS means those shares of capital
stock listed and described in Schedule 1.45.
1.46. 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.
1.47. INFORMATION STATEMENT means the Information Statement
forming a part of the Form 10 Registration Statement to be mailed to holders of
ATI Common Stock in connection with the Distribution.
1.48. INITIAL MEDIATION PERIOD has the meaning set forth in
Section 10.14.
1.49. INSURANCE POLICIES means the insurance policies written
by insurance carriers unaffiliated with ATI pursuant to which Teledyne
Technologies or one or more of its Subsidiaries (or their respective officers or
directors) will be insured parties after the Effective Time.
1.50. INSURANCE PROCEEDS means those monies:
(a) received by an insured from an insurance carrier;
(b) paid by an insurance carrier on behalf of the insured; or
(c) received (including by way of set off) from any third
party in the nature of insurance, contribution or indemnification in
respect of any Liability;
in any such case net of any applicable premium adjustments (including reserves
and retrospectively rated premium adjustments) and net of any costs or expenses
(including allocated costs of in-house counsel and other personnel) incurred in
the collection thereof.
1.51. INTERIM SERVICES AGREEMENT means the Interim Services
Agreement, dated as of the date hereof, by and between ATI and Teledyne
Technologies.
1.52. LIABILITIES means any and all losses, claims, charges,
debts, demands, actions, causes of action, suits, damages, obligations,
payments, costs and expenses, sums of money, accounts, reckonings, bonds,
specialties, indemnities and similar obligations, exonerations,
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covenants, contracts, controversies, agreements, promises, doings, omissions,
variances, guarantees, make whole agreements and similar obligations, and other
liabilities, including all contractual obligations, whether absolute or
contingent, matured or unmatured, liquidated or unliquidated, accrued or
unaccrued, known or unknown, whenever arising, and including those arising under
any law, rule, regulation, Action, threatened or contemplated Action (including
the costs and expenses of demands, assessments, judgments, settlements and
compromises relating thereto and reasonable attorneys' fees and any and all
costs and expenses (including allocated costs of in-house counsel and other
personnel), whatsoever incurred in investigating, preparing or defending against
any such Actions or threatened or contemplated Actions), order or consent decree
of any Governmental Authority or any award of any arbitrator or mediator of any
kind, and those arising under any contract, commitment or undertaking, including
those arising under this Agreement or any Ancillary Agreement, in each case,
whether or not recorded or reflected or required to be recorded or reflected on
the books and records or financial statements of any Person.
1.53. LICENSE AGREEMENT means the License Agreement, dated as
of the date hereof, by and between TII and Teledyne Technologies.
1.54. NYSE means The New York Stock Exchange, Inc.
1.55. NON-TELEDYNE TECHNOLOGIES ASSETS means any Assets of ATI
or any of its Affiliates (including any member of the Water Pik Group) other
than the Teledyne Technologies Assets.
1.56. PATENT ASSIGNMENTS means the Patent Assignments,
effective as of __________ 1999, executed and delivered by _____________ to
______________.
1.57 PER CASE MAXIMUM means (i) with respect to any single
occurrence covered under ATI General Liability Policies, ATI Product Liability
Policies, and ATI Automobile Policies, $100,000 (inclusive of indemnity and loss
adjustment expenses multiplied by applicable Expense Factors) and (ii) with
respect to any single occurrence covered by ATI Workers Compensation policies,
$150,000 (inclusive of indemnity and loss adjustment expenses multiplied by
applicable Expense Factors).
1.58. PERSON means an individual, a general or limited
partnership, a corporation, a trust, a joint venture, an unincorporated
organization, a limited liability entity, any other entity and any Governmental
Authority.
1.59 POOLED LOSS COSTS ALLOCABLE TO TELEDYNE TECHNOLOGIES
means the share allocated to Teledyne Technologies by virtue of its
participation in a pooling arrangement among ATI divisions applicable to claims
that (i) are covered under ATI General Liability Policies, ATI Product Liability
Policies, ATI Automobile Policies, and ATI Workers Compensation Policies; (ii)
exceed the Per Case Maximum; and (iii) are within a policy's deductible or other
form of self-insurance, which allocation to Teledyne Technologies will be based
upon the same or substantially similar to those factors as have been applied
immediately before the Distribution Date.
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1.60. PRIME RATE means the rate which PNC Bank, N.A.,
Pittsburgh, Pennsylvania (or any successor thereto or other commercial bank
agreed to by the parties hereto) announces from time to time as its prime
lending rate, as in effect from time to time.
1.61. PUBLIC OFFERING means the underwritten public offering
by Teledyne Technologies of shares of Teledyne Technologies Common Stock
pursuant to the Public Offering Registration Statement and as contemplated by
the Tax Sharing Agreement.
1.62. PUBLIC OFFERING REGISTRATION STATEMENT means the
registration statement to be filed by Teledyne Technologies under the Securities
Act of 1933, as amended, pursuant to which the offering and sale of shares of
Teledyne Technologies Common Stock to be issued in the Public Offering will be
registered, together with all amendments thereto.
1.63. PURCHASE AND SALE AGREEMENTS means (i) the Purchase and
Sale Agreement, dated as of the date hereof, between Xxxxx and Teledyne
Environmental, (ii) the Purchase and Sale Agreement, dated as of the date
hereof, between Teledyne Ltd. and Teledyne Limited, (iii) the Purchase and Sale
Agreement, dated as of the date hereof, between Teledyne Technologies and
Industries International, and (iv) the Purchase and Sale Agreement, dated as of
the date hereof, between Industries International and Teledyne Investment.
1.64. RECORD DATE means the close of business on the date
determined by the ATI Board of Directors as the record date for determining
stockholders of ATI entitled to receive shares of Teledyne Technologies Common
Stock in the Distribution.
1.65. RIGHTS means the Rights to be distributed by Teledyne
Technologies in respect of Teledyne Technologies Common Stock in accordance with
Section 3.02 hereof and pursuant to the Rights Agreement between Teledyne
Technologies and ChaseMellon Shareholder Services, L.L.C.
1.66. RULING REQUEST means the request for ruling (including
all exhibits), as amended and supplemented, under Section 355 and other
provisions of the Code, originally filed on behalf of ATI on April 6, 1999 in
respect of the Distribution.
1.67. SECURITY INTEREST means any mortgage, security interest,
pledge, lien, charge, claim, option, right to acquire, voting or other
restriction, right-of-way, covenant, condition, easement, encroachment,
restriction on transfer, or other encumbrance of any nature whatsoever.
1.68. SELF INSURANCE OBLIGATION means an obligation by one or
more insureds to pay or reimburse to the issuers of an insurance policy (whether
by way of deductible, retrospective premium, premium adjustment, self-insured
retention or other form of self-insurance), indemnity, allocated loss expense,
and other proceeds multiplied by Expense Factors, if any.
1.69. SEPARATION means the transfer of the Teledyne
Technologies Assets to Teledyne Technologies and its Subsidiaries and the
assumption by Teledyne Technologies and its
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Subsidiaries of the Teledyne Technologies Liabilities, all as more fully
described in this Agreement and the Ancillary Agreements.
1.70. SUBSIDIARY of any Person means any corporation or other
organization whether incorporated or unincorporated of which at least a majority
of the securities or interests having by the terms thereof ordinary voting power
to elect at least a majority of the board of directors or others performing
similar functions with respect to such corporation or other organization is
directly or indirectly owned or controlled by such Person or by any one or more
of its Subsidiaries, or by such Person and one or more of its Subsidiaries;
provided, however that no Person that is not directly or indirectly wholly owned
by any other Person shall be a Subsidiary of such other Person unless such other
Person controls, or has the right, power or ability to control, that Person.
1.71. TAX SHARING AGREEMENT means the Tax Sharing and
Indemnification Agreement, dated as of the date hereof, as the same may be
amended, by and between ATI and Teledyne Technologies.
1.72. TAXES has the meaning set forth in the Tax Sharing
Agreement.
1.73. TELEDYNE ENVIRONMENTAL means Teledyne Environmental,
Inc., a California corporation wholly owned by TI.
1.74. TELEDYNE ENVIRONMENTAL ASSETS means those certain assets
of Teledyne Environmental listed and described in Schedule 1.74.
1.75. TELEDYNE INVESTMENT means Teledyne Investment, Inc., a
Delaware corporation.
1.76. TELEDYNE LIMITED means Teledyne Limited, a company
organized under the laws of the United Kingdom and an indirect wholly owned
subsidiary of TI.
1.77. TELEDYNE LIMITED ASSETS means those certain assets of
Teledyne Limited listed and described in Schedule 1.77.
1.78. TELEDYNE LTD. means Teledyne Ltd., a corporation
organized under the laws of the United Kingdom and wholly owned by Teledyne
Technologies.
1.79. TELEDYNE TECHNOLOGIES ASSETS has the meaning set forth
in Section 2.02(a).
1.80. TELEDYNE TECHNOLOGIES BALANCE SHEET means the
consolidated balance sheet of Teledyne Technologies, including the notes
thereto, as of [September 30], 1999.
1.81. TELEDYNE TECHNOLOGIES BUSINESS means the business and
operations of the divisions and Subsidiaries of TI or TII comprising Teledyne
Electronic Technologies, Teledyne Xxxxx Engineering, Teledyne Continental Motors
and
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Teledyne Cast Parts and any business or operation conducted by Teledyne
Technologies or any Affiliate of Teledyne Technologies at any time on or after
the Distribution Date.
1.82. TELEDYNE TECHNOLOGIES COMMON STOCK means the Common
Stock, $.01 par value per share, of Teledyne Technologies and, after the
distribution of Rights referred to in Section 3.02, shall include the associated
Rights.
1.83. TELEDYNE TECHNOLOGIES CONTRACTS means the following
contracts and agreements to which TII or any of its Affiliates is a party or by
it or any of its Affiliates or any of their respective Assets is bound, whether
as of the date hereof or prior to or at the Effective Time, and whether or not
in writing, except for any such contract or agreement that is expressly
contemplated to be retained by any member of the ATI Group pursuant to any
provision of this Agreement or any Ancillary Agreement:
(a) any contract or agreement entered into in the name of, or
expressly on behalf of, any division, business unit or member of the
Teledyne Technologies Group;
(b) any contract or agreement that relates exclusively to the
Teledyne Technologies Business, including those listed or described on
Schedule 1.83(b);
(c) federal, state and local government and other contracts
and agreements that relate exclusively to the Teledyne Technologies
Business, including those listed or described on Schedule 1.83(c);
(d) any contract or agreement representing capital or
operating equipment lease obligations reflected on the Teledyne
Technologies Balance Sheet, including obligations as lessee under those
contracts or agreements listed on Schedule 1.83(d) (as such Schedule
may be supplemented after the date hereof and prior to the Effective
Time to assign capital and operating equipment lease obligations that
relate exclusively to the Teledyne Technologies Business and that were,
are or may be executed and delivered after the date of the Teledyne
Technologies Balance Sheet);
(e) any contract or agreement that is otherwise expressly
contemplated pursuant to this Agreement or any of the Ancillary
Agreements to be assigned to Teledyne Technologies or any member of the
Teledyne Technologies Group;
(f) any guarantee, indemnity, representation, warranty or
other Liability of any member of the Teledyne Technologies Group or the
ATI Group in respect of any other Teledyne Technologies Contract, any
Teledyne Technologies Liability or the Teledyne Technologies Business
(including guarantees of financing incurred by customers or other third
parties in connection with purchases of products or services from the
Teledyne Technologies Business); and
(g) the contracts, agreements and other documents listed or
described on Schedule 1.83(g).
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1.84. TELEDYNE TECHNOLOGIES GROUP means Teledyne Technologies,
each Subsidiary of Teledyne Technologies and each other Person that is
contemplated to be controlled directly or indirectly by Teledyne Technologies as
of the Effective Time.
1.85. TELEDYNE TECHNOLOGIES INDEMNITEES has the meaning set
forth in Section 5.03(a).
1.86. TELEDYNE TECHNOLOGIES LIABILITIES has the meaning set
forth in Section 2.03.
1.87. THIRD PARTY CLAIM has the meaning set forth in Section
5.05(a).
1.88. TI means Teledyne, Inc., a Delaware corporation.
1.89. TI LIQUIDATION means the dissolution and liquidation of
TI in accordance with applicable provisions of the DGCL and Section 332 of the
Code, as a result of which Holdings will own all of the outstanding capital
stock of TII.
1.90. TRADE DRESS ASSIGNMENT means the Trade Dress Assignment,
dated as of the date hereof, by ______ to ______.
1.91. TRADEMARK AND SERVICE XXXX ASSIGNMENT means the
Trademark and Service Xxxx Assignment, dated as of the date hereof, by ____ to
____.
1.92. UNDERWRITERS means the managing underwriters for the
Public Offering.
1.93. UNDERWRITING AGREEMENT means an underwriting agreement
in customary form to be entered into among Teledyne Technologies and the
Underwriters with respect to the Public Offering.
1.94. UNPAID LOSSES means liabilities and losses, including
indemnity payments and allocated loss expenses, that are subject to a Self
Insurance Obligation and that, as of the Distribution Date have not been paid by
Teledyne Technologies or a member of Teledyne Technologies Group and that do not
appear on Schedule 1.94.
1.95. WATER PIK COMMON STOCK means the Common Stock, par value
$.01 per share, of Water Pik.
1.96. WATER PIK DISTRIBUTION means the distribution by ATI on
a pro rata basis to holders of ATI Common Stock of all of the outstanding shares
of Water Pik Common Stock owned by ATI.
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1.97. WATER PIK GROUP means Water Pik, each Subsidiary of
Water Pik and each other Person that is contemplated to be controlled directly
or indirectly by Water Pik at the time of the Water Pik Distribution.
1.98. WATER PIK LIABILITIES has the meaning assigned to that
term in the Water Pik Separation and Distribution Agreement.
1.99. WATER PIK SEPARATION AND DISTRIBUTION AGREEMENT means
the Separation and Distribution Agreement, dated as of _________, 1999, among
ATI, Holdings, TII and Water Pik.
1.100. YEAR 2000 COMPLIANT means, with respect to an Asset,
that such Asset will (i) accurately process date/time data (including, but not
limited to, calculating, comparing, sorting, sequencing and calendar
generation), including single century formulas and multi-century formulas, from,
into and between the twentieth and twenty-first centuries and the years 1999 and
2000, including leap year calculations, and will not malfunction or generate
incorrect values or invalid results involving such dates/times; (ii) accurately
interface with other systems, as appropriate, in order to supply, receive or
process dates/times and other data, to the extent that other information
technology properly exchanges data with it; (iii) provide that date/time-related
functionalities, date/time fields and any user input interfaces include a four
digit year format and/or other indication of century, as applicable; and (iv)
not cause any other Asset that is otherwise Year 2000 Compliant to fail to be
Year 2000 Compliant.
ARTICLE II
THE SEPARATION
2.01. TRANSFER OF ASSETS AND ASSUMPTION OF LIABILITIES. (a)
TII hereby assigns, transfers, conveys and delivers to Teledyne Technologies,
and agrees to cause its applicable Subsidiaries to assign, transfer, convey and
deliver to Teledyne Technologies, and Teledyne Technologies hereby accepts from
TII and its Subsidiaries, all of TII's and its applicable Subsidiaries'
respective right, title and interest in all Teledyne Technologies Assets.
(b) Teledyne Technologies hereby assumes and agrees faithfully
to perform, satisfy, discharge and fulfill all the Teledyne Technologies
Liabilities in accordance with their respective terms. Teledyne Technologies
shall be responsible for all Teledyne Technologies Liabilities, regardless of
when or where such Liabilities arose or arise or whether the facts on which they
are based occurred prior to or subsequent to the date hereof, regardless of
where or against whom such Liabilities are asserted or determined or whether
asserted or determined prior to the date hereof, and regardless of whether
arising from or alleged to arise from negligence, recklessness, violation of
law, fraud or misrepresentation (whether based on tort, contract, statute or
otherwise) by any member of the ATI Group or the Teledyne Technologies Group or
any of their respective directors, officers, employees, agents, Subsidiaries or
Affiliates.
(c) In the event that at any time or from time to time
(whether prior to or after the Distribution Date) any party hereto (or any
member of such party's respective Group), shall receive or otherwise possess any
Asset that is allocated to any other Person pursuant to this
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Agreement or any Ancillary Agreement, such party or member shall promptly
transfer, or cause to be transferred, such Asset to the Person so entitled
thereto. Prior to any such transfer, the Person receiving or possessing such
Asset shall hold such Asset in trust for any such other Person.
2.02. TELEDYNE TECHNOLOGIES ASSETS. (a) For purposes of this
Agreement, "Teledyne Technologies Assets" shall mean (without duplication):
(i) all Assets reflected in the Teledyne Technologies Balance
Sheet as Assets of Teledyne Technologies and its Subsidiaries, subject
to any dispositions of any such Assets subsequent to the date of the
Teledyne Technologies Balance Sheet;
(ii) all Assets acquired by or for the exclusive benefit of
Teledyne Technologies subsequent to the date of the Teledyne
Technologies Balance Sheet and prior to the Effective Time that would
have been reflected in the Teledyne Technologies Balance Sheet as
Assets of Teledyne Technologies had they been owned on the date of the
Teledyne Technologies Balance Sheet;
(iii)subject to Section 6.01, any rights of any member of the
Teledyne Technologies Group under any of the Insurance Policies,
including any rights thereunder arising after the Distribution Date in
respect of any Insurance Policies that are occurrence policies; and
(iv) (A) any Assets that any Ancillary Agreement contemplates
will be transferred to any member of the Teledyne Technologies Group,
(B) any Teledyne Technologies Contracts and (C) all issued and
outstanding capital stock of the Subsidiaries, the partnership
interests and other Assets of TII listed on Schedule 2.02(a)(iv).
Notwithstanding the foregoing, the Teledyne Technologies Assets shall not in any
event include the Excluded Assets referred to in Section 2.02(b) below.
(b) For the purposes of this Agreement, "Excluded Assets"
shall mean:
(i) the Assets listed or described on Schedule 2.02(b)(i); and
(ii) any and all Assets that are expressly contemplated by
this Agreement or any Ancillary Agreement (or the Schedules hereto or
thereto) as Assets to be retained by ATI or any other member of the ATI
Group (including the Water Pik Group).
(c) Teledyne Technologies acknowledges and agrees that the
Assets reflected as Teledyne Technologies Assets in the Teledyne Technologies
Balance Sheet are so reflected based on the books and records maintained, and
other information supplied, by Teledyne Technologies personnel, and that the
Teledyne Technologies Assets constitute all of the Assets necessary to operate
the Teledyne Technologies Business as presently conducted.
2.03. TELEDYNE TECHNOLOGIES LIABILITIES. For the purposes of
this Agreement, "Teledyne Technologies Liabilities" shall mean (without
duplication):
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(i) any and all Liabilities that are expressly contemplated by
this Agreement or any Ancillary Agreement (or the Schedules hereto or
thereto) as Liabilities to be assumed by Teledyne Technologies or any
member of the Teledyne Technologies Group, including those described in
Schedule 2.03(a)(i), and all agreements, obligations and Liabilities of
any member of the Teledyne Technologies Group under this Agreement or
any of the Ancillary Agreements;
(ii) all Liabilities, including any employee-related
Liabilities and Environmental Liabilities, relating to, arising out of
or resulting from:
(A) the operation of the Teledyne Technologies
Business as conducted at any time prior to, at or after the
Effective Time (including any Liability relating to, arising
out of or resulting from the design, manufacture and sale of
products or services of the Teledyne Technologies Business or
from any act or failure to act by any director, officer,
employee, agent or representative of any Person (whether or
not such act or failure to act is or was within such Person's
authority));
(B) the operation of any business conducted by any
member of the Teledyne Technologies Group at any time after
the Effective Time (including any Liability relating to,
arising out of or resulting from any act or failure to act by
any director, officer, employee, agent or representative of
any Person (whether or not such act or failure to act is or
was within such Person's authority)); or
(C) any Teledyne Technologies Assets (including any
Teledyne Technologies Contracts and any real property and
leasehold interests) or ownership of any Teledyne Technologies
Assets at any time prior to, at or after the Effective Time;
in any such case whether arising before, on or after the Effective
Time;
(iii) all Liabilities relating to, arising out of or resulting
from the Financing Facility;
(iv) all Liabilities relating to, arising out of or resulting
from any of the terminated, divested or discontinued businesses and
operations listed or described on Schedule 2.03(a)(iv);
(v) all Liabilities reflected as liabilities or obligations of
Teledyne Technologies in the Teledyne Technologies Balance Sheet,
subject to any discharge of such Liabilities subsequent to the date of
the Teledyne Technologies Balance Sheet, and all liabilities or
obligations of Teledyne Technologies incurred subsequent to the date of
the Teledyne Technologies Balance Sheet that would have been reflected
in the Teledyne Technologies Balance Sheet had they been incurred as of
the date of the Teledyne Technologies Balance Sheet;
(vi) any Liabilities relating to, arising out of or resulting
from any infringement of any intellectual property of any third party,
including but not limited to patent rights,
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trademark and service xxxx rights (registered and common law), trade
dress rights, copyrights, misappropriation of trade secret, based upon
or resulting from the operation of the Teledyne Technologies Business
and regardless of whether said infringement occurred prior to, on or
after the Distribution Date;
(vii) all obligations of ATI or Teledyne Technologies under
the advance agreement made and entered into the 15th day of July, 1999,
by and between the United States Department of Defense on behalf of the
United States of America and ATI and any other advance agreements that
such parties may enter into prior to the Distribution Date;
(viii) any and all guarantees by ATI or any member of the ATI
Group of obligations to assure payment or performance by or other
Liabilities of the Teledyne Technologies Group or the Teledyne
Technologies Business; and
(ix) any Liabilities relating to, arising out of, or resulting
from any of the Teledyne Technologies Assets that are not Year 2000
Compliant.
2.04. TERMINATION OF AGREEMENTS. (a) Except as set forth in
Section 2.04(b), in furtherance of the releases and other provisions of Section
5.01 hereof, Teledyne Technologies and each member of the Teledyne Technologies
Group, on the one hand, and each of ATI and the respective members of the ATI
Group, on the other hand, hereby terminate any and all agreements, arrangements,
commitments or understandings, whether or not in writing, between or among
Teledyne Technologies and/or any member of the Teledyne Technologies Group, on
the one hand, and ATI or any member of the ATI Group, on the other hand,
effective as of the Effective Time, including (except as set forth in Schedule
2.04(a)) any intercompany accounts payable or accounts receivable accrued as of
the Effective Time that are reflected in the books and records of the parties or
otherwise documented in writing in accordance with past practices; provided,
however, to the extent that the termination of any such agreement, arrangement,
commitment or understanding is inconsistent with any Ancillary Agreement, such
termination shall be effective as of the date of effectiveness of the applicable
Ancillary Agreement. No such terminated agreement, arrangement, commitment or
understanding (including any provision thereof which purports to survive
termination) shall be of any further force or effect after the Effective Time
(or, to the extent contemplated by the proviso to the immediately preceding
sentence, after the effective time of the applicable Ancillary Agreement). Each
party shall, at the reasonable request of any other party, take, or cause to be
taken, such other actions as may be necessary to effect the foregoing.
(b) The provisions of Section 2.04(a) shall not apply to any
of the following agreements, arrangements, commitments or understandings (or to
any of the provisions thereof): (i) this Agreement and the Ancillary Agreements
(and each other agreement or instrument expressly contemplated by this Agreement
or any Ancillary Agreement to be entered into by any of the parties hereto or
any of the members of their respective Groups); (ii) any agreements,
arrangements, commitments or understandings listed or described on Schedule
2.04(b)(ii); (iii) any agreements, arrangements, commitments or understandings
to which any Person other than the parties hereto and their respective
Affiliates is a party (it being understood that to the extent that the rights
and obligations of the parties and the members of their respective Groups under
any
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such agreements, arrangements, commitments or understandings constitute Teledyne
Technologies Assets or Teledyne Technologies Liabilities, they shall be assigned
and assumed pursuant to Section 2.01); and (iv) any other agreements,
arrangements, commitments or understandings that this Agreement or any Ancillary
Agreement expressly contemplates will survive the Effective Time.
2.05. DOCUMENTS RELATING TO TRANSFER OF REAL PROPERTY
INTERESTS AND TANGIBLE PROPERTY LOCATED THEREON. In furtherance of the
assignment, transfer and conveyance of Teledyne Technologies Assets and the
assumption of Teledyne Technologies Liabilities set forth in Section 2.01(a) and
(b), simultaneously with the execution and delivery hereof or as promptly as
practicable thereafter, each of TII and Teledyne Technologies or their
applicable Subsidiaries is executing and delivering or will execute and deliver
such deeds, lease assignments and assumptions, leases, subleases and
sub-subleases as may be necessary to effectively transfer any real property and
leasehold interests forming part of the Teledyne Technologies Assets and conform
to any laws, regulations or usage applicable in the jurisdiction in which the
relevant real property is located.
2.06. DOCUMENTS FURTHER EVIDENCING TRANSFERS OF ASSETS AND
ASSUMPTION OF LIABILITIES. In furtherance of the assignment, transfer and
conveyance of Teledyne Technologies Assets and the assumption of Teledyne
Technologies Liabilities set forth in Section 2.01(a) and (b), simultaneously
with the execution and delivery hereof or as promptly as practicable thereafter,
(i) TII shall execute and deliver, and shall cause its Subsidiaries to execute
and deliver, such further bills of sale, stock powers, certificates of title,
assignments of contracts and other instruments of transfer, conveyance and
assignment as and to the extent necessary to fully evidence the transfer,
conveyance and assignment of all of TII's and its respective Subsidiaries'
right, title and interest in and to the Teledyne Technologies Assets to Teledyne
Technologies and (ii) Teledyne Technologies shall execute and deliver to TII and
its Subsidiaries such further bills of sale, stock powers, certificates of
title, assumptions of contracts and other instruments of assumption as and to
the extent necessary to fully evidence the valid and effective assumption of the
Teledyne Technologies Liabilities by Teledyne Technologies.
2.07. OTHER ANCILLARY AGREEMENTS. Effective as of the date
hereof each of ATI, TII and Teledyne Technologies will execute and deliver, and
cause any of their respective Subsidiaries that are parties thereto to execute
and deliver all Ancillary Agreements to which it is a party.
2.08. DISCLAIMER OF REPRESENTATIONS AND WARRANTIES. Each of
ATI (on behalf of itself and each member of ATI, including TII) and Teledyne
Technologies (on behalf of itself and each member of the Teledyne Technologies
Group) understands and agrees that, except as expressly set forth herein or in
any Ancillary Agreement, no party to this Agreement, any Ancillary Agreement or
any other agreement or document contemplated by this Agreement, any Ancillary
Agreement or otherwise, is representing or warranting in any way as to the
Assets, businesses or Liabilities transferred or assumed as contemplated hereby
or thereby (including whether an Asset is Year 2000 Compliant), as to any
consents or approvals required in connection therewith, as to the value or
freedom from any Security Interests of, or any other matter concerning, any
Assets of such party, or as to the absence of any defenses or rights of
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setoff or freedom from counterclaims with respect to any claim or other Asset,
including any accounts receivable, of any party, or as to the legal sufficiency
of any assignment, document or instrument delivered hereunder to convey title to
any Asset or thing of value upon the execution, delivery and filing hereof or
thereof. Except as may expressly be set forth herein or in any Ancillary
Agreement, all such Assets are being transferred on an "as is," "where is,"
"with all faults" basis (and, in the case of any real property, by means of a
quitclaim or similar form deed or conveyance) and the respective transferees
shall bear the economic and legal risks that any conveyance shall prove to be
insufficient to vest in the transferee good and marketable title, free and clear
of any Security Interest. Without limiting the foregoing, neither ATI nor any
other party hereto (excluding Teledyne Technologies), or to any Ancillary
Agreement, is making any representation or warranty to Teledyne Technologies or
any other Person in respect of the Teledyne Technologies Balance Sheet,
including in respect of the accuracy or presentation thereof, or the adequacy of
accruals, reserves and other amounts reflected thereon.
2.09. FINANCING ARRANGEMENTS. Each of the parties hereto
acknowledges that (a) ATI has arranged availability for up to $___ million in
senior secured financing pursuant to the Financing Facility, (b) that ATI has,
prior to the date hereof, incurred $____ million in indebtedness pursuant to
such Financing Facility; and (c) that ATI has used, or will use prior to the
Distribution Date, such indebtedness to refinance other outstanding indebtedness
of ATI. Teledyne Technologies agrees that, following the Distribution Date,
Teledyne Technologies will indemnify ATI (and all the other members of the ATI
Group) and defend and hold such parties harmless from and against all the
obligations of ATI (or Teledyne Technologies) arising under the Financing
Facility (including the obligation to repay such $___ million in outstanding
borrowings), with the effect that ATI (and all other members of the ATI Group)
shall have no further liability or obligation under the Financing Facility.
2.10. GOVERNMENTAL APPROVALS AND CONSENTS. (a) To the extent
that the Separation requires any Governmental Approvals or Consents, the parties
will use all reasonable efforts to obtain any such Governmental Approvals and
Consents.
(b) If and to the extent that the valid, complete and
perfected transfer or assignment (or novation of any federal government
contract) to the Teledyne Technologies Group of any Teledyne Technologies Assets
(or from the Teledyne Technologies Group of any Non-Teledyne Technologies
Assets) would be a violation of applicable laws or require any Consent or
Governmental Approval in connection with the Separation, then, unless ATI shall
otherwise determine, the transfer or assignment to or from the Teledyne
Technologies Group, as the case may be, of such Teledyne Technologies Assets or
Non-Teledyne Technologies Assets, respectively, shall be automatically deemed
deferred and any such purported transfer or assignment shall be null and void
until such time as all legal impediments are removed and/or such Consents or
Governmental Approvals have been obtained. Notwithstanding the foregoing, such
Asset shall be deemed a Teledyne Technologies Asset for purposes of determining
whether any Liability is a Teledyne Technologies Liability.
(c) If the transfer or assignment of any Assets intended to be
transferred or assigned hereunder is not consummated prior to or at the
Effective Time, whether as a result of the provisions of Section 2.10(b) or for
any other reason, then the Person retaining such Asset
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shall thereafter hold such Asset for the use and benefit, insofar as reasonably
possible, of the Person entitled thereto (at the expense of the Person entitled
thereto). In addition, the Person retaining such Asset shall take such other
actions as may be reasonably requested by the Person to whom such Asset is to be
transferred in order to place such Person, insofar as reasonably possible, in
the same position as if such Asset had been transferred as contemplated hereby
and so that all the benefits and burdens relating to such Teledyne Technologies
Assets (or such Non-Teledyne Technologies Assets, as the case may be), including
possession, use, risk of loss, potential for gain, and dominion, control and
command over such Assets, are to inure from and after the Effective Time to the
Teledyne Technologies Group (or the ATI Group, as the case may be).
(d) If and when the Consents and/or Governmental Approvals,
the absence of which caused the deferral of transfer of any Asset pursuant to
Section 2.10(b), are obtained, the transfer of the applicable Asset shall be
effected in accordance with the terms of this Agreement and/or the applicable
Ancillary Agreement.
(e) The Person retaining an Asset due to the deferral of the
transfer of such Asset shall not be obligated, in connection with the foregoing,
to expend any money unless the necessary funds are advanced by the Person
entitled to the Asset, other than reasonable out-of-pocket expenses, attorneys'
fees and recording or similar fees, all of which shall be promptly reimbursed by
the Person entitled to such Asset.
2.11. NOVATION OF ASSUMED TELEDYNE TECHNOLOGIES LIABILITIES.
(a) Each of ATI, TII and Teledyne Technologies at the request of any of the
others, shall use all reasonable efforts to obtain, or to cause to be obtained,
any consent, substitution, approval or amendment required to novate (including
with respect to any federal government contract) or assign all obligations under
agreements, leases, licenses and other obligations or Liabilities, or to obtain
in writing the unconditional release of all parties to such arrangements other
than any member of the Teledyne Technologies Group, so that, in any such case,
Teledyne Technologies and its Subsidiaries will be solely responsible for such
Liabilities; provided, however, that no member of the ATI Group shall be
obligated to pay any consideration therefor to any third party from whom such
consents, approvals, substitutions and amendments are requested.
(b) If ATI, TII or Teledyne Technologies is unable to obtain,
or to cause to be obtained, any such required consent, approval, release,
substitution or amendment, the applicable member of the ATI Group shall continue
to be bound by such agreements, leases, licenses and other obligations and,
unless not permitted by law or the terms thereof, Teledyne Technologies shall,
as agent or subcontractor for ATI, TII or such other Person, as the case may be,
pay, perform and discharge fully all the obligations or other Liabilities of
ATI, TII or such other Person, as the case may be, thereunder from and after the
date hereof. Teledyne Technologies shall indemnify and defend each ATI
Indemnitee and hold each of them harmless against any Liabilities arising in
connection therewith. Each of ATI and TII, as the case may be, shall, without
further consideration, pay and remit, or cause to be paid or remitted, to
Teledyne Technologies promptly all money, rights and other consideration
received by it or any member of its respective Group in respect of such
performance (unless any such consideration is an Excluded Asset). If and when
any such consent, approval, release, substitution or amendment shall be
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obtained or such agreement, lease, license or other rights or obligations shall
otherwise become assignable or able to be novated, each of ATI and TII, as the
case may be, shall thereafter assign, or cause to be assigned, all its rights,
obligations and other Liabilities thereunder or any rights or obligations of any
member of its respective Group to Teledyne Technologies without payment of
further consideration and Teledyne Technologies shall, without the payment of
any further consideration, assume such rights and obligations.
2.12. TRANSFER OF XXXXX ASSETS AND ASSUMPTION OF XXXXX
LIABILITIES. Immediately following the transfer of Teledyne Technologies Assets
and assumption of Teledyne Technologies Liabilities contemplated by Section
2.01, Teledyne Technologies shall contribute to Xxxxx approximately $6,800,000
in cash and the Xxxxx Assets and cause Xxxxx to assume the Xxxxx Liabilities,
all in accordance with the Xxxxx Transfer and Assumption Agreement.
2.13. CONSUMMATION OF PURCHASE AND SALE AGREEMENTS; INTERIM
CONTRIBUTION. Immediately following the transfer of Assets and assumption of
Liabilities contemplated by Section 2.12, the parties hereto will cause the
transactions contemplated by the Purchase and Sale Agreements to be consummated,
pursuant to which (i) Xxxxx will purchase the Teledyne Environmental Assets from
Teledyne Environmental for approximately $6,800,000 in cash, (ii) Teledyne
Technologies Ltd. will purchase the Teledyne Limited Assets from Teledyne
Limited for approximately $5,700,000 in cash, (iii) Teledyne Technologies will
purchase the Industries Stock Interests from Industries International for
approximately $200,000 in cash, and (iv) Teledyne Investment will purchase a 1%
common stock interest in Ensambles de Precision, S.A. de C.V. from Industries
International for approximately $2,000 in cash.
2.14. TI CONTRIBUTION AND LIQUIDATION. Prior to consummation
of the transactions contemplated by Section 2.15, ATI will contribute to
Holdings all of the outstanding capital stock of TI and the TI Liquidation will
be effected.
2.15. INTERIM DISTRIBUTIONS. Following the TI Liquidation, TII
will distribute to Holdings and Holdings will distribute to ATI all of the
outstanding Teledyne Technologies Common Stock.
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ARTICLE III
THE DISTRIBUTION
3.01. THE DISTRIBUTION. The ATI Board shall have the sole and
absolute discretion to determine whether and when to effect the Distribution. If
the ATI Board declares the Distribution, on or prior to the Distribution Date,
ATI will deliver to the Agent for the benefit of holders of record of ATI Common
Stock on the Record Date, a single stock certificate, endorsed by ATI in blank,
representing all of the outstanding shares of Teledyne Technologies Common Stock
then owned by ATI or any member of the ATI Group, and will instruct the Agent to
distribute, or make book-entry credits for, one share of Teledyne Technologies
Common Stock in respect of every ____ shares of ATI Common Stock held by holders
of record of ATI Common Stock on the Record Date, subject to Section 3.03.
3.02. ACTIONS PRIOR TO THE DISTRIBUTION. Prior to the
Distribution:
(a) On such date as ATI shall determine, Teledyne Technologies
shall mail to the holders of ATI Common Stock the Information Statement.
(b) ATI and Teledyne Technologies shall cooperate in
preparing, filing with the Commission under the Securities Act and causing to
become effective any registration statements or amendments thereto that are
appropriate to reflect the establishment of or amendments to any employee
benefit plan contemplated by the Employee Benefits Agreement.
(c) ATI and Teledyne Technologies shall by means of a
reclassification, stock split or stock distribution or other means cause the
number of outstanding shares of Teledyne Technologies Common Stock held by ATI
to be equal to the number of shares to be distributed in the Distribution (as
determined by ATI).
(d) ATI and Teledyne Technologies shall take all such action
as may be necessary or appropriate under the securities or blue sky laws of
states or other political subdivisions of the United States in connection with
the transactions contemplated by this Agreement or any Ancillary Agreement.
(e) Teledyne Technologies shall use all efforts to have
approved an application to permit listing of the Teledyne Technologies Common
Stock on the NYSE or another mutually agreeable stock exchange or quotation
system.
(f) ATI and Teledyne Technologies shall take all actions which
may be required to elect or otherwise appoint as directors of Teledyne
Technologies, on or prior to the Distribution Date, the persons named in the
Form 10 Registration Statement to constitute the Board of Directors of Teledyne
Technologies on the Distribution Date.
(g) ATI shall cause a Certificate of Amendment and Restatement
of the Teledyne Technologies Certificate of Incorporation substantially in the
form filed with the Form 10 Registration Statement, to be filed for record with
the Secretary of State of Delaware and to be in effect on the Distribution Date,
and the Board of Directors of Teledyne Technologies shall
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amend the Bylaws of Teledyne Technologies so that the Teledyne Technologies
Bylaws are substantially in the form filed with the Form 10 Registration
Statement.
(h) Teledyne Technologies shall declare a distribution of, and
distribute, one Right with respect to each share of Teledyne Technologies Common
Stock to be distributed in the Distribution.
(i) ATI and Teledyne Technologies shall take all actions as
may be necessary to approve the stock-based employee benefit plans of Teledyne
Technologies in order to satisfy the requirements of Section 162(m) and other
applicable provisions of the Code and any requirements of the NYSE (or any other
stock exchange or quotations system on which Teledyne Technologies Common Stock
is to be listed or traded).
3.03. FRACTIONAL SHARES. No certificates or scrip representing
fractional shares of Teledyne Technologies Common Stock will be distributed to
holders of ATI Common Stock in the Distribution. The Agent will, as soon as
practicable after the Distribution Date, (a) determine the number of whole
shares and fractional shares of Teledyne Technologies Common Stock allocable to
each holder of record of ATI Common Stock as of the Record Date, (b) aggregate
all fractional shares held by such holders, and (c) sell the whole shares
attributable to the aggregate of such fractional shares, in open market
transactions, in each case at the then prevailing trading prices, and to cause
to be distributed to each such holder, in lieu of any fractional share, without
interest, such holder's ratable share of the proceeds of such sale, after making
appropriate deductions of the amount required, if any, to be withheld for U.S.
federal income tax purposes.
ARTICLE IV
THE PUBLIC OFFERING
4.01. THE PUBLIC OFFERING. (a) Teledyne Technologies shall
consummate the Public Offering not later than one year following the
Distribution Date. Actions required in order to so consummate the Public
Offering shall include, but not necessarily be limited to, those specified in
this Section 4.01.
(b) Teledyne Technologies shall file the Public Offering
Registration Statement not later than at the end of the eighth month following
the month in which the Distribution Date occurs, and shall file 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 Underwriters, including, but
not limited to, filing such amendments to the Public Offering Registration
Statement as may be required by the Underwriting Agreement, the Commission or
federal, state or foreign securities laws.
(c) Teledyne Technologies shall enter into the Underwriting
Agreement and shall comply with its obligations thereunder.
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(d) Teledyne Technologies shall 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 Public Offering.
(e) Teledyne Technologies shall prepare, file and take all
actions necessary to make effective an application for listing of the Teledyne
Technologies Common Stock issued in the Public Offering on the NYSE, subject to
official notice of issuance.
(f) Teledyne Technologies shall participate in the preparation
of materials and presentations as the Underwriters shall deem necessary or
desirable.
(g) Teledyne Technologies shall pay all third party costs,
fees and expenses relating to the Public Offering, all of the reimbursable
expenses of the Underwriters pursuant to the Underwriting Agreement, all of the
costs of producing, printing, mailing and otherwise distributing the Prospectus,
as well as the Underwriters' discount as provided in the Underwriting Agreement.
4.02. PROCEEDS OF THE PUBLIC OFFERING. The Public Offering
will be a primary offering of Teledyne Technologies Common Stock and the net
proceeds of the Public Offering will be retained by Teledyne Technologies.
Teledyne Technologies will use such net proceeds as provided in the Tax Sharing
Agreement and the Ruling Request.
4.03. REMEDIES. Teledyne Technologies acknowledges that its
agreements in this Article IV are of a special, unique, unusual and
extraordinary character. Because the failure of Teledyne Technologies to perform
its obligations set forth in the provisions of this Article IV could cause
unique and extraordinary injury to ATI, ATI shall, notwithstanding anything to
the contrary herein, have the right in addition to any other remedies available,
at law or in equity, to seek an injunction in a court of equity to compel
Teledyne Technologies to perform such obligations. Teledyne Technologies hereby
waives any and all defenses it may have on the ground of lack of jurisdiction or
competence of the court to grant an injunction or other equitable relief, or
otherwise, and agrees that it will not assert any such defense or any defense to
a request by ATI for injunctive relief based on the alleged existence of an
adequate remedy at law or for money damages. Without limiting the foregoing,
Teledyne Technologies hereby waives the right to require ATI to post any bond or
other security with respect to any proceeding to enforce the provisions of this
Article IV. The existence of the rights of ATI set forth in this Section 4.03
shall not preclude any other rights and remedies at law or in equity which ATI
may have.
ARTICLE V
MUTUAL RELEASES; INDEMNIFICATION
5.01. RELEASE OF PRE-DISTRIBUTION CLAIMS. (a) Except as
provided in Section 5.01(c), effective as of the Effective Time, Teledyne
Technologies does hereby, for itself and each other member of the Teledyne
Technologies Group, their respective Affiliates (other than any member of the
ATI Group), successors and assigns, and all Persons who at any time prior to the
Effective Time have been stockholders, directors, officers, agents or employees
of any
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member of the Teledyne Technologies Group (in each case, in their respective
capacities as such), remise, release and forever discharge each of ATI and Water
Pik, the respective members of the ATI Group and the Water Pik Group, their
respective Affiliates (other than any member of the Teledyne Technologies
Group), successors and assigns, and all Persons who at any time prior to the
Effective Time have been stockholders, directors, officers, agents or employees
of any member of ATI or the Water Pik Group (in each case, in their respective
capacities as such), and their respective heirs, executors, administrators,
successors and assigns, from any and all Liabilities whatsoever, whether at law
or in equity (including any right of contribution), whether arising under any
contract or agreement, by operation of law or otherwise, existing or arising
from any acts or events occurring or failing to occur or alleged to have
occurred or to have failed to occur or any conditions existing or alleged to
have existed on or before the Effective Time, including in connection with the
transactions and all other activities undertaken to implement the Separation or
the Distribution.
(b) Except as provided in Section 5.01(c), effective as of the
Effective Time, ATI does hereby, for itself and each other member of the ATI
Group and its Affiliates (other than any member of the Teledyne Technologies
Group), successors and assigns, and all Persons who at any time prior to the
Effective Time have been stockholders, directors, officers, agents or employees
of any member of the ATI Group (in each case, in their respective capacities as
such), remise, release and forever discharge Teledyne Technologies, the
respective members of the Teledyne Technologies Group, their respective
Affiliates (other than any member of the ATI Group), successors and assigns, and
all Persons who at any time prior to the Effective Time have been stockholders,
directors, officers, agents or employees of any member of the Teledyne
Technologies Group (in each case, in their respective capacities as such), and
their respective heirs, executors, administrators, successors and assigns, from
any and all Liabilities whatsoever, whether at law or in equity (including any
right of contribution), whether arising under any contract or agreement, by
operation of law or otherwise, existing or arising from any acts or events
occurring or failing to occur or alleged to have occurred or to have failed to
occur or any conditions existing or alleged to have existed on or before the
Effective Time, including in connection with the transactions and all other
activities undertaken to implement the Separation or the Distribution.
(c) Nothing contained in Section 5.01(a) or (b) shall impair
any right of any Person to enforce this Agreement, any Ancillary Agreement or
any agreements, arrangements, commitments or understandings that are specified
in Section 2.04(b) or the applicable Schedules thereto not to terminate as of
the Effective Time, in each case in accordance with its terms. Nothing contained
in Section 5.01(a) or (b) shall release any Person from:
(i) any Liability provided in or resulting from any agreement
among any members of the ATI Group or the Teledyne Technologies Group
that is specified in Section 2.04(b) or the applicable Schedules
thereto as not to terminate as of the Effective Time, or any other
Liability specified in such Section 2.04(b) as not to terminate as of
the Effective Time;
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(ii) any Liability, contingent or otherwise, assumed,
transferred, assigned or allocated to the Group of which such Person is
a member in accordance with, or any other Liability of any member of
any Group under, this Agreement or any Ancillary Agreement;
(iii) any Liability for the sale, lease, construction or
receipt of goods, property or services purchased, obtained or used in
the ordinary course of business by a member of one Group from a member
of any other Group prior to the Effective Time;
(iv) any Liability for unpaid amounts for products or services
or refunds owing on products or services due on a value-received basis
for work done by a member of one Group at the request or on behalf of a
member of another Group;
(v) any Liability that the parties may have with respect to
indemnification or contribution pursuant to this Agreement for claims
brought against the parties by third Persons, which Liability shall be
governed by the provisions of this Article V and, if applicable, the
appropriate provisions of the Ancillary Agreements; or
(vi) any Liability the release of which would result in the
release of any Person other than a Person released pursuant to this
Section 5.01; provided that the parties agree not to bring suit or
permit any of their Subsidiaries to bring suit against any Person with
respect to any Liability to the extent that such Person would be
released with respect to such Liability by this Section 5.01 but for
the provisions of this clause (vi).
(d) Teledyne Technologies shall not make, and shall not
permit any member of the Teledyne Technologies Group to make, any claim or
demand, or commence any Action asserting any claim or demand, including any
claim of contribution or indemnification, against ATI, Water Pik or any member
of the ATI Group or Water Pik Group, or any other Person released pursuant to
Section 5.01(a), with respect to any Liabilities released pursuant to Section
5.01(a). Without limiting the generality of the foregoing, Teledyne Technologies
shall not make, and shall not permit any other member of the Teledyne
Technologies Group to make, any claim or demand, or commence any Action
asserting any claim or demand, including any claim of contribution or
indemnification, against ATI, Water Pik or any member of the ATI Group or the
Water Pik Group, or any other Person released pursuant to Section 5.01(a), with
respect to whether any Asset should or should not have been classified as a
Teledyne Technologies Asset or whether any Liability should or should not have
been classified as a Teledyne Technologies Liability or with respect to the
Teledyne Technologies Balance Sheet, including in respect of the accuracy or
presentation thereof, or the adequacy of accruals, reserves and other amounts
reflected thereon. ATI shall not, and shall not permit any member of the ATI
Group, to make any claim or demand, or commence any Action asserting any claim
or demand, including any claim of contribution or any indemnification, against
Teledyne Technologies or any member of the Teledyne Technologies Group, or any
other Person released pursuant to Section 5.01(b), with respect to any
Liabilities released pursuant to Section 5.01(b).
(e) It is the intent of each of ATI and Teledyne Technologies
by virtue of the provisions of this Section 5.01 to provide for a full and
complete release and discharge of all Liabilities existing or arising from all
acts and events occurring or failing to occur or alleged to have occurred or to
have failed to occur and all conditions existing or alleged to
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have existed on or before the Effective Time, between or among Teledyne
Technologies or any member of the Teledyne Technologies Group, on the one hand,
and ATI, Water Pik or any member of the ATI Group or the Water Pik Group, on the
other hand (including any contractual agreements or arrangements existing or
alleged to exist between or among any such members on or before the Effective
Time), except as expressly set forth in Section 5.01(c) or otherwise in this
Agreement. At any time, at the request of any other party, each party shall
cause each member of its respective Group to execute and deliver releases
reflecting the provisions hereof.
5.02. INDEMNIFICATION BY TELEDYNE TECHNOLOGIES. Except as
provided in Section 5.04, Teledyne Technologies shall indemnify, defend and hold
harmless ATI, each member of the ATI Group and each of their respective
directors, officers, employees, agents and representatives, and each of the
heirs, executors, successors and assigns of any of the foregoing (collectively,
the "ATI Indemnitees"), and Water Pik, each member of the Water Pik Group and
each of their respective directors, officers and employees, and each of the
heirs, executors, successors and assigns of any of the foregoing (collectively,
the "Water Pik Indemnitees"), from and against any and all Liabilities of the
ATI Indemnitees and the Water Pik Indemnitees, respectively, relating to,
arising out of or resulting from any of the following items (without
duplication):
(a) the failure of Teledyne Technologies or any other member
of the Teledyne Technologies Group or any other Person to pay, perform or
otherwise promptly discharge any Teledyne Technologies Liabilities or Teledyne
Technologies Contract in accordance with their respective terms, whether prior
to or after the Effective Time or the date hereof;
(b) the Teledyne Technologies Business, any Teledyne
Technologies Liability or any Teledyne Technologies Contract;
(c) any breach by Teledyne Technologies or any member of the
Teledyne Technologies Group of this Agreement or any of the Ancillary
Agreements;
(d) the operation of the Teledyne Technologies Business, as
conducted at any time prior to, on or after the Distribution Date (including any
Liability relating to, arising out of or resulting from any act or failure to
act by any director, officer, employee, agent or representative (whether or not
such act or failure to act is or was within such Person's authority));
(e) any infringement of any intellectual property right of any
third party, including, but not limited to, patent rights, trademark and service
xxxx rights (registered and common law), trade dress rights, copyrights,
missappropriation of trade secret, based upon or resulting from the operation of
the Teledyne Technologies Business and regardless of whether said alleged
infringement occurred prior to, on or after the Distribution Date;
(f) Liabilities assumed by any member of the Teledyne
Technologies Group under any Ancillary Agreement;
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(g) any guarantee, indemnity, representation, warranty or
other Liability of or made by any member of the ATI Group in respect of any
Liability or alleged Liability of any member of the Teledyne Technologies Group;
and
(h) any untrue statement or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact required
to be stated therein or necessary to make the statements therein not misleading,
with respect to all information contained in the Form 10 Registration Statement
or the Information Statement.
5.03. INDEMNIFICATION BY ATI. (a) ATI shall indemnify, defend
and hold harmless Teledyne Technologies, each member of the Teledyne
Technologies Group and each of their respective directors, officers, employees,
agents and representatives, and each of the heirs, executors, successors and
assigns of any of the foregoing (collectively, the "Teledyne Technologies
Indemnitees"), from and against any and all Liabilities of the Teledyne
Technologies Indemnitees relating to, arising out of or resulting from any of
the following items (without duplication):
(i) the failure of ATI or any other member of the ATI Group to
pay, perform or otherwise promptly discharge any ATI Liabilities; and
(ii) any breach by ATI of this Agreement or any of the
Ancillary Agreements.
5.04. INDEMNIFICATION OBLIGATIONS NET OF INSURANCE PROCEEDS
AND OTHER AMOUNTS. (a) The parties intend that any Liability subject to
indemnification or reimbursement pursuant to this Article V will be net of
Insurance Proceeds that actually reduce the amount of the Liability.
Accordingly, the amount which any party (an "Indemnifying Party") is required to
pay to any Person entitled to indemnification hereunder (an "Indemnitee") will
be reduced by any Insurance Proceeds theretofore actually recovered by or on
behalf of the Indemnitee in reduction of the related Liability. If an Indemnitee
receives a payment (an "Indemnity Payment") required by this Agreement from an
Indemnifying Party in respect of any Liability and subsequently receives
Insurance Proceeds, then the Indemnitee will pay to the Indemnifying Party an
amount equal to the excess of the Indemnity Payment received over the amount of
the Indemnity Payment that would have been due if the Insurance Proceeds had
been received, realized or recovered before the Indemnity Payment was made.
(b) 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 provisions hereof, have any subrogation
rights with respect thereto, it being expressly understood and agreed that no
insurer or any other third party shall be entitled to a "windfall" (i.e., a
benefit they would not be entitled to receive in the absence of the
indemnification provisions) by virtue of the indemnification provisions hereof.
Nothing contained in this Agreement or any Ancillary Agreement shall obligate
any member of any Group to seek to collect or recover any Insurance Proceeds.
5.05. PROCEDURES FOR INDEMNIFICATION OF THIRD PARTY CLAIMS.
(a) If an Indemnitee shall receive notice or otherwise learn of the assertion by
a Person (including any Governmental Authority) who is not a member of the ATI
Group or the
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Teledyne Technologies Group of any claim or of the commencement by any such
Person of any Action (collectively, a "Third Party Claim") with respect to which
an Indemnifying Party may be obligated to provide indemnification to such
Indemnitee pursuant to Section 5.02 or 5.03, or any other Section of this
Agreement or any Ancillary Agreement, such Indemnitee shall give such
Indemnifying Party and, if ATI is not the Indemnifying Party, ATI written notice
thereof as soon as practicable but in any event not less than 20 days after
becoming aware of such Third Party Claim. Any such notice shall describe the
Third Party Claim in reasonable detail. Notwithstanding the foregoing, the
failure of any Indemnitee or other Person to give notice as provided in this
Section 5.05(a) shall not relieve the related Indemnifying Party of its
obligations under this Article V, except to the extent that such Indemnifying
Party is actually prejudiced by such failure to give notice.
(b) An Indemnifying Party may elect to defend (and, unless the
Indemnifying Party has specified any reservations or exceptions, to seek to
settle or compromise), at such Indemnifying Party's own expense and by such
Indemnifying Party's own counsel, any Third Party Claim. Within 30 days after
the receipt of notice from an Indemnitee in accordance with Section 5.05(a) (or
sooner, if the nature of such Third Party Claim so requires), the Indemnifying
Party shall notify the Indemnitee of its election whether the Indemnifying Party
will assume responsibility for defending such Third Party Claim, which election
shall specify any reservations or exceptions. After notice from an Indemnifying
Party to an Indemnitee of its election to assume the defense of a Third Party
Claim, such Indemnitee shall have the right to employ separate counsel and to
participate in (but not control) the defense, compromise, or settlement thereof,
but the fees and expenses of such counsel shall be the expense of such
Indemnitee except as set forth in the next sentence. In the event that the
Indemnifying Party has elected to assume the defense of the Third Party Claim
but has specified, and continues to assert, any reservations or exceptions in
such notice, then, in any such case, the reasonable fees and expenses of one
separate counsel for all Indemnitees shall be borne by the Indemnifying Party.
(c) If an Indemnifying Party elects not to assume
responsibility for defending a Third Party Claim, or fails to notify an
Indemnitee of its election as provided in Section 5.05(b), such Indemnitee may
defend such Third Party Claim at the cost and expense (including allocated costs
of in-house counsel and other personnel) of the Indemnifying Party.
(d) Unless the Indemnifying Party has failed to assume the
defense of the Third Party Claim in accordance with the terms of this Agreement,
no Indemnitee may settle or compromise any Third Party Claim without the consent
of the Indemnifying Party.
(e) No Indemnifying Party shall consent to entry of any
judgment or enter into any settlement of the Third Party Claim without the
consent of the Indemnitee if the effect thereof is to permit any injunction,
declaratory judgment, other order or other nonmonetary relief to be entered,
directly or indirectly, against any Indemnitee.
5.06. ADDITIONAL MATTERS. (a) Any claim on account of a
Liability which does not result from a Third Party Claim shall be asserted by
written notice given by the Indemnitee to the related Indemnifying Party. Such
Indemnifying Party shall have a period of 30 days after the receipt of such
notice within which to respond thereto. If such Indemnifying Party
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does not respond within such 30-day period, such Indemnifying Party shall be
deemed to have refused to accept responsibility to make payment. If such
Indemnifying Party does not respond within such 30-day period or rejects such
claim in whole or in part, such Indemnitee shall be free to pursue such remedies
as may be available to such party as contemplated by this Agreement and the
Ancillary Agreements.
(b) In the event of payment by or on behalf of any
Indemnifying Party to any Indemnitee in connection with any Third Party Claim,
such Indemnifying Party shall be subrogated to and shall stand in the place of
such Indemnitee as to any events or circumstances in respect of which such
Indemnitee may have any right, defense or claim relating to such Third Party
Claim against any claimant or plaintiff asserting such Third Party Claim or
against any other person. Such Indemnitee shall cooperate with such Indemnifying
Party in a reasonable manner, and at the cost and expense (including allocated
costs of in-house counsel and other personnel) of such Indemnifying Party, in
prosecuting any subrogated right, defense or claim.
(c) In the event of an Action in which the Indemnifying Party
is not a named defendant, if either the Indemnified Party or Indemnifying Party
shall so request, the parties shall endeavor to substitute the Indemnifying
Party for the named defendant. If such substitution or addition cannot be
achieved for any reason or is not requested, the named defendant shall allow the
Indemnifying Party to manage the Action as set forth in this Section and the
Indemnifying Party shall fully indemnify the named defendant against all costs
of defending the Action (including court costs, sanctions imposed by a court,
attorneys' fees, experts' fees and all other external expenses, and the
allocated costs of in-house counsel and other personnel), the costs of any
judgment or settlement, and the cost of any interest or penalties relating to
any judgment or settlement.
5.07. REMEDIES CUMULATIVE. The remedies provided in this
Article V shall be cumulative and shall not preclude assertion by any Indemnitee
of any other rights or the seeking of any and all other remedies against any
Indemnifying Party.
5.08. SURVIVAL OF INDEMNITIES. The rights and obligations of
each of the Indemnitees under this Article V shall survive the sale or other
transfer by any party of any Assets or businesses or the assignment by it of any
Liabilities.
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ARTICLE VI
CERTAIN OTHER MATTERS
6.01. INSURANCE MATTERS. (a) In no event shall ATI, any other
member of the ATI Group or any ATI Indemnitee have any liability or obligation
whatsoever to any member of the Teledyne Technologies Group in the event that
any Insurance Policy or other contract or policy of insurance shall be
terminated or otherwise cease to be in effect for any reason, shall be
unavailable or inadequate to cover any Liability of any member of the Teledyne
Technologies Group for any reason whatsoever or shall not be renewed or extended
beyond the current expiration date.
(b) (i) Except as otherwise provided in any Ancillary
Agreement, the parties intend by this Agreement that Teledyne Technologies and
each other member of the Teledyne Technologies Group be successors-in-interest
to all rights that any member of the Teledyne Technologies Group may have as of
the Distribution Date as a subsidiary, affiliate, division or department of ATI
prior to the Distribution Date under any policy of insurance issued to ATI and
intended to insure the Teledyne Technologies Group by any insurance carrier
unaffiliated with ATI or under any agreements related to such policies executed
and delivered prior to the Distribution Date, including any rights such member
of the Teledyne Technologies Group may have, as an insured or additional named
insured, subsidiary, affiliate, division or department, to avail itself of any
such policy of insurance or any such agreements related to such policies as in
effect prior to the Distribution Date. At the request of Teledyne Technologies,
ATI shall take all reasonable steps, including the execution and delivery of any
instruments, to effect the foregoing; provided however that ATI shall not be
required to pay any amounts, waive any rights or incur any Liabilities in
connection therewith.
(ii) Except as otherwise contemplated by any Ancillary
Agreement, after the Distribution Date, neither ATI nor Teledyne Technologies or
any member of their respective Groups shall, without the consent of the other,
provide any such insurance carrier with a release, or amend, modify or waive any
rights under any such policy or agreement, if such release, amendment,
modification or waiver would adversely affect any rights or potential rights of
any member of the other Group thereunder; provided however that the foregoing
shall not (A) preclude any member of any Group from presenting any claim or from
exhausting any policy limit, (B) require any member of any Group to pay any
premium or other amount or to incur any Liability, or (C) require any member of
any Group to renew, extend or continue any policy in force. Each of Teledyne
Technologies and ATI will, and will cause its respective Group to, share such
information as is reasonably necessary in order to permit the other to manage
and conduct its insurance matters in an orderly fashion.
(c) This Agreement shall not be considered as an attempted
assignment of any policy of insurance or as a contract of insurance and shall
not be construed to waive any right or remedy of any member of the ATI Group in
respect of any Insurance Policy or any other contract or policy of insurance.
(d) Teledyne Technologies does hereby, for itself and each
other member of the Teledyne Technologies Group, agree that no member of the ATI
Group or any ATI Indemnitee
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shall have any Liability whatsoever as a result of the insurance policies and
practices of ATI and its Affiliates as in effect at any time prior to the
Distribution Date, including as a result of the level or scope of any such
insurance, the creditworthiness of any insurance carrier, the terms and
conditions of any policy, the adequacy or timeliness of any notice to any
insurance carrier with respect to any claim or potential claim or otherwise.
(e) Nothing in this Agreement shall be deemed to restrict any
member of the Teledyne Technologies Group from acquiring at its own expense any
other insurance policy in respect of any Liabilities or covering any period.
(f) With respect to policy periods prior to the Distribution
Date:
(i) Teledyne Technologies shall be responsible for:
(A) all Unpaid Losses (but not to exceed the applicable Per Case
Maximum) as of the Distribution Date attributable to Teledyne
Technologies Liabilities covered under ATI General Liability Policies,
ATI Automobile Policies, ATI Workers Compensation Policies and ATI
Product Liability Policies for policies in effect prior to the
Distribution Date; and (B) Pooled Loss Costs Allocable to Teledyne
Technologies.
(ii) On or before June 1, 2000 and on a quarterly
basis thereafter, ATI shall provide Teledyne Technologies with a
calculation of amounts due ATI or refunds due Teledyne Technologies for
Teledyne Technologies' obligations incurred under ATI General Liability
Policies, ATI Automobile Policies, ATI Workers Compensation Policies
and ATI Product Liability Policies for policies under subparagraph (i)
immediately above. The initial calculations shall be based on (A) the
change in total Incurred Losses between the Distribution Date and March
31, 2000 for all such policies in effect prior to the Distribution Date
multiplied by the Expense Factors set forth in such policies and
applicable to such Incurred Losses, but only with respect to that
portion of Incurred Losses attributable to Teledyne Technologies
Liabilities not exceeding the applicable Per Case Maximum; and (B) the
change in Pooled Loss Costs Allocable to Teledyne Technologies for the
period between the Distribution Date and March 31, 2000 for all such
policies in effect prior to the Distribution Date. Subsequent
calculations shall be based on (A) the change in total Incurred Losses
for the subsequent quarterly periods multiplied by the Expense Factors
set forth in such policies and applicable to such losses; but only with
respect to that portion of losses attributable to Teledyne Technologies
Liabilities not exceeding the applicable Per Case Maximum, and (B) the
change in Pooled Loss Costs Allocable to Teledyne Technologies for the
subsequent quarterly period.
(iii) Within 30 days after receipt by Teledyne
Technologies of ATI's calculations referred to in subparagraph (ii)
immediately above, Teledyne Technologies on the one hand and ATI on the
other hand shall pay to the other the net amount owed after taking into
account the combined amounts reflected on the calculations.
(g) At its sole option, ATI shall have the right to handle,
defend, resolve, and administer any and all claims in its sole discretion, with
respect to Teledyne Technologies Liabilities covered, in whole or in part, by
ATI Policies, including, without limitation, the
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reporting of claims to the issuers of such ATI Policies, as well as the
management, defense and settlement of claims. Teledyne Technologies agrees to
cooperate, at its own expense, with ATI in the reporting, handling, defense,
resolution and administration of such claims. Alternatively, ATI, at its sole
option shall have the right to require, at any time and from time to time, that
Teledyne Technologies and any member of the Teledyne Technologies Group, at
their sole expense, defend, resolve and administer any one or more or all claims
with respect to Teledyne Technologies Liabilities covered in whole, or in part,
by ATI Policies, including without limitation, the reporting of claims to the
issuers of such ATI Policies, as well as the management, defense and settlement
of such claims and, if ATI exercises such option, Teledyne Technologies and
members of the Teledyne Technologies Group, at ATI's request, shall at their
expense provide ATI with any and all information concerning, and permit ATI to
monitor, the foregoing management, defense, settlement and insurance handling of
such claims. Except with the express written consent of ATI, neither Teledyne
Technologies nor any member of the Teledyne Technologies Group shall provide any
issuer of ATI Policies with a release, nor shall they amend, modify, or waive
any rights under such ATI Policies, if such release, amendment, modification or
waiver would adversely affect rights or potential rights of ATI or any other
member of the ATI Group.
(h) With respect to policies procured by or for the Teledyne
Technologies Group subsequent to January 1999 and to policy years commencing on
or after the Distribution Date, Teledyne Technologies shall be responsible for
all aspects of claims administration with respect to Teledyne Technologies
Liabilities, and ATI shall have no responsibility therefor whatsoever.
(i) With respect to any Teledyne Technologies Liabilities or
Teledyne Technologies losses covered under ATI Policies, other than ATI General
Liability Policies, ATI Automobile Policies, ATI Workers Compensation Policies
and ATI Product Liability Policies, Teledyne Technologies shall be responsible
for all Unpaid Losses and all costs and expenses that give rise to a
Self-Insurance Obligation. In the event that ATI pays any such costs and
expenses, Teledyne Technologies shall reimburse ATI within thirty days of
receipt of a billing for any such costs and expenses.
6.02. CERTAIN BUSINESS MATTERS. No member of any Group shall
have any duty to refrain from (i) engaging in the same or similar activities or
lines of business as any member of any other Group, (ii) doing business with any
potential or actual supplier or customer of any member of any other Group, or
(iii) engaging in, or refraining from, any other activities whatsoever relating
to any of the potential or actual suppliers or customers of any member of any
other Group.
6.03. LATE PAYMENTS. Except as expressly provided to the
contrary in this Agreement or in any Ancillary Agreement, any amount not paid
when due pursuant to this Agreement or any Ancillary Agreement (and any amounts
billed or otherwise invoiced or demanded and properly payable that are not paid
within 30 days of such xxxx, invoice or other demand) shall accrue interest at a
rate per annum equal to the Prime Rate plus 2%.
6.04. CERTAIN GOVERNANCE MATTERS. (a) Teledyne Technologies
and ATI intend that until the third annual meeting of stockholders of Teledyne
Technologies held following the Distribution Date, at least a majority of the
members of the Board of Directors of Teledyne Technologies will at all times
consist of persons who are also members of the Board of Directors of ATI. The
initial members of the Board of Directors of Teledyne Technologies and the
respective initial Classes of the Board in which they will serve are as follows:
Class I: C. Xxxx Xxxxxxxxx
Class II: Xxxxxx Xxxxxxxxx
Class III: Xxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx, Xx.
(b) Teledyne Technologies will, with respect to the first
annual meeting of stockholders of Teledyne Technologies held following the
Distribution Date, nominate for election and recommend to stockholders the
election of C. Xxxx Xxxxxxxxx (or, if he is unable or unwilling to serve, such
other candidate as Messrs. Cahouet and Xxxxxxx or the survivor of them shall
designate) to serve as a continuing Class I director of Teledyne Technologies.
(c) Teledyne Technologies shall take such action from time to
time as ATI requests in order to assure that, until the third annual meeting of
stockholders of Teledyne Technologies following the Distribution Date, at least
a majority of the members of the Board of Directors of Teledyne Technologies
will at all times consist of persons who are also members of the Board of
Directors of ATI. Without limiting the generality of the foregoing, if for any
reason (including death, resignation or disqualification) there are no
directors of Teledyne Technologies who are also directors of ATI, Teledyne
Technologies will immediately take all action requested by ATI to appoint to
the Board of Directors of Teledyne Technologies such members of the Board of
Directors of ATI as ATI shall designate.
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ARTICLE VII
EXCHANGE OF INFORMATION; CONFIDENTIALITY
7.01. AGREEMENT FOR EXCHANGE OF INFORMATION; ARCHIVES. (a)
Each of ATI and Teledyne Technologies, on behalf of itself and its respective
Group, agrees to provide, or cause to be provided, to each other Group, 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 respective Group which the requesting party reasonably requires
(i) to comply with reporting, disclosure, filing or other requirements imposed
on the requesting party (including under applicable securities or tax laws) by a
Governmental Authority having jurisdiction over the requesting party, (ii) for
use in any other judicial, regulatory, administrative, tax or other proceeding
or in order to satisfy audit, accounting, claims, regulatory, litigation, tax or
other similar requirements, or (iii) to comply with its obligations under this
Agreement or any Ancillary Agreement; 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.
(b) After the Distribution Date, each of ATI and Teledyne
Technologies shall have access during regular business hours (as in effect from
time to time) to the documents and objects of historic significance that relate
to the their respective Businesses that are in the possession of any other of
such parties or members of their respective Groups. Any party seeking such
access may, at its cost, obtain copies (but not originals) of documents for bona
fide business purposes and may obtain objects for exhibition purposes for
commercially reasonable periods of time if required for bona fide business
purposes, provided that such party shall cause any such objects to be returned
promptly in the same condition in which they were delivered and shall comply
with any rules, procedures or other requirements, and shall be subject to any
restrictions (including prohibitions on removal of specified objects), that are
then applicable to the possessing party.
(c) After the Distribution Date, (i) Teledyne Technologies
shall maintain in effect adequate systems and controls to the extent necessary
to enable the members of the ATI Group to satisfy their respective reporting,
accounting, audit and other obligations, and (ii) Teledyne Technologies shall
provide, or cause to be provided, to ATI, all financial and other data and
information as ATI determines necessary or advisable in order to prepare ATI
financial statements and reports or filings with any Governmental Authority.
7.02. OWNERSHIP OF INFORMATION. Any Information owned by one
Group that is provided to a requesting party pursuant to Section 7.01 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.
7.03. COMPENSATION FOR PROVIDING INFORMATION. The party
requesting such Information agrees to reimburse the other party for the
reasonable costs, if any, of creating, gathering and copying such Information,
to the extent that such costs are incurred for
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the benefit of the requesting party. Except as may be otherwise specifically
provided elsewhere in this Agreement or in any other agreement between the
parties, such costs shall be computed in accordance with the providing party's
standard methodology and procedures.
7.04. RECORD RETENTION. To facilitate the possible exchange of
Information pursuant to this Article VII and other provisions of this Agreement
after the Distribution Date, the parties agree to use their reasonable best
efforts to retain all Information in their respective possession or control on
the Distribution Date in accordance with the policies of ATI as in effect on the
Distribution Date. No party will destroy, or permit any of its Subsidiaries to
destroy, any Information which the other party may have the right to obtain
pursuant to this Agreement prior to the seventh anniversary of the date hereof
without first using its reasonable best 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; provided, however,
that in the case of any Information relating to Taxes or to Environmental
Liabilities, such period shall be extended to the expiration of the applicable
statute of limitations (giving effect to any extensions thereof).
7.05. OTHER AGREEMENTS PROVIDING FOR EXCHANGE OF INFORMATION.
The rights and obligations granted under this Article VII are subject to any
specific limitations, qualifications or additional provisions on the sharing,
exchange or confidential treatment of Information set forth in any Ancillary
Agreement.
7.06. PRODUCTION OF WITNESSES; RECORDS; COOPERATION. (a) After
the Distribution Date, except in the case of an adversarial Action by one party
against another party, each party hereto shall use its reasonable efforts to
make available to each other party, upon written request, the former, current
and future directors, officers, employees, other personnel and agents of the
members of its respective Group 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 Action in which the requesting party may from time to time be involved,
regardless of whether such Action is a matter with respect to which
indemnification may be sought hereunder. The requesting party shall bear all
costs and expenses (including allocated costs of in-house counsel and other
personnel) in connection therewith.
(b) If an Indemnifying Party chooses to defend or to seek to
compromise or settle any Third Party Claim, the other parties shall make
available to such Indemnifying Party, upon written request, the former, current
and future directors, officers, employees, other personnel and agents of the
members of its respective Group as witnesses and any books, records or other
documents within its control 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
such defense, settlement or compromise, or such prosecution, evaluation or
pursuit, as the case may be, and shall otherwise cooperate in such defense,
settlement or compromise, or such prosecution, evaluation or pursuit, as the
case may be.
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(c) Without limiting any provision of this Section, the
parties shall cooperate and consult to the extent reasonably necessary with
respect to any Action, and each of the parties agrees to cooperate, and to cause
each member of its respective Group to cooperate, with each other in the defense
of any infringement or similar claim with respect to any intellectual property
and shall not claim to acknowledge, or permit any member of its respective Group
to claim to acknowledge, the validity or infringing use of any intellectual
property of a third Person in a manner that would hamper or undermine the
defense of such infringement or similar claim.
(d) The obligation of the parties to provide witnesses
pursuant to this Section 7.06 is intended to be interpreted in a manner so as to
facilitate cooperation and shall include the obligation to provide as witnesses
inventors and other officers without regard to whether the witness or the
employer of the witness could assert a possible business conflict (subject to
the qualifications set forth in the first sentence of Section 7.06(a)).
(e) In connection with any matter contemplated by this Section
7.06, the parties will enter into a mutually acceptable joint defense agreement
so as to maintain to the extent practicable any applicable attorney-client
privilege or work product immunity of any member of any Group.
7.07. CONFIDENTIALITY. (a) Subject to Section 7.08, each of
ATI and Teledyne Technologies, on behalf of itself and each member of its
respective Group, agrees to hold, and to cause its respective directors,
officers, employees, agents, accountants, counsel and other advisors and
representatives to hold, in strict confidence, with at least the same degree of
care that applies to ATI's confidential and proprietary information pursuant to
policies in effect as of the Distribution Date, all Information concerning each
such other Group that is either in its possession or furnished by any such other
Group or its respective directors, officers, employees, agents, accountants,
counsel and other advisors and representatives at any time pursuant to this
Agreement, any Ancillary Agreement or otherwise, and shall not use any such
Information other than for such purposes as shall be expressly permitted
hereunder or thereunder, except, in each case, to the extent that such
Information has been (i) in the public domain through no fault of such party or
any member of such Group or any of their respective directors, officers,
employees, agents, accountants, counsel and other advisors and representatives,
(ii) later lawfully acquired from other sources by such party (or any member of
such party's Group) which sources are not themselves bound by a confidentiality
obligation), or (iii) independently generated without reference to any
proprietary or confidential Information of the other party.
(b) Each party agrees not to release or disclose, or permit to
be released or disclosed, any such Information to any other Person, except its
directors, officers, employees, agents, accountants, counsel and other advisors
and representatives who need to know such Information (who shall be advised of
their obligations hereunder with respect to such Information), except in
compliance with Section 7.08. Without limiting the foregoing, when any
Information is no longer needed for the purposes contemplated by this Agreement
or any Ancillary Agreement, each party will promptly after request of the other
party either return to the other party all Information in a tangible form
(including all copies thereof and all notes, extracts or summaries based
thereon) or certify to the other party that it has destroyed such Information
(and such copies thereof and such notes, extracts or summaries based thereon).
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7.08. PROTECTIVE ARRANGEMENTS. In the event that any party or
any member of its Group either determines on the advice of its counsel that it
is required to disclose any Information pursuant to applicable law or receives
any demand under lawful process or from any Governmental Authority to disclose
or provide Information of any other party (or any member of any other party's
Group) that is subject to the confidentiality provisions hereof, such party
shall notify the other party prior to disclosing or providing such Information
and shall cooperate at the expense of the requesting party in seeking any
reasonable protective arrangements requested by such other party. Subject to the
foregoing, the Person that received such request may thereafter disclose or
provide Information to the extent required by such law (as so advised by
counsel) or by lawful process or such Governmental Authority.
ARTICLE VIII
FURTHER ASSURANCES
8.01. FURTHER ASSURANCES. (a) In addition to the actions
specifically provided for elsewhere in this Agreement, each of the parties
hereto shall use its reasonable efforts, prior to, on and after the Distribution
Date, to take, or cause to be taken, all actions, and to do, or cause to be
done, all things, reasonably necessary, proper or advisable under applicable
laws, regulations and agreements to consummate and make effective the
transactions contemplated by this Agreement and the Ancillary Agreements.
(b) Without limiting the foregoing, prior to, on and after the
date hereof, each party hereto shall cooperate with the other parties, and
without any further consideration, but at the expense of the requesting party,
to execute and deliver, or use its reasonable efforts to cause to be executed
and delivered, all instruments, including instruments of conveyance, assignment
and transfer, and to make all filings with, and to obtain all consents,
approvals or authorizations of, any Governmental Authority or any other Person
under any permit, license, agreement, indenture or other instrument (including
any Consents or Governmental Approvals), and to take all such other actions as
such party may reasonably be requested to take by any other party hereto from
time to time, consistent with the terms of this Agreement and the Ancillary
Agreements, in order to effectuate the provisions and purposes of this Agreement
and the Ancillary Agreements and the transfers of the Teledyne Technologies
Assets and the assignment and assumption of the Teledyne Technologies
Liabilities and the other transactions contemplated hereby and thereby. Without
limiting the foregoing, each party will, at the reasonable request, cost and
expense of any other party, take such other actions as may be reasonably
necessary to vest in such other party good and marketable title, free and clear
of any Security Interest, if and to the extent it is practicable to do so.
(c) On or prior to the Distribution Date, ATI and Teledyne
Technologies in their respective capacities as direct and indirect stockholders
of their respective Subsidiaries, shall each ratify any actions which are
reasonably necessary or desirable to be taken by ATI or Teledyne Technologies or
any other Subsidiary of ATI, as the case may be, to effectuate the transactions
contemplated by this Agreement.
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(d) ATI and Teledyne Technologies, on behalf of itself and
each member of its respective Group, waive (and agree not to assert against any
of the others) any claim or demand that any of them may have against any of the
others for any Liabilities or other claims relating to or arising out of: (i)
the failure of Teledyne Technologies or any member of the Teledyne Technologies
Group, on the one hand, or of ATI or any member of the ATI Group, on the other
hand, to provide any notification or disclosure required under any state
Environmental Law in connection with the Separation or the other transactions
contemplated by this Agreement, including the transfer by any member of any
Group to any member of any other Group of ownership or operational control of
any Assets not previously owned or operated by such transferee; or (ii) any
inadequate, incorrect or incomplete notification or disclosure under any such
state Environmental Law by the applicable transferor. To the extent any
Liability to any Governmental Authority or any third Person arises out of any
action or inaction described in clause (i) or (ii) above, the transferee of the
applicable Asset hereby assumes and agrees to pay any such Liability.
ARTICLE IX
TERMINATION
9.01. TERMINATION. This Agreement may be terminated by ATI at
any time prior to the Distribution Date.
9.02. EFFECT OF TERMINATION. In the event of any termination
of this Agreement pursuant to Section 9.01, no party to this Agreement (or any
of its directors or officers) shall have any Liability or further obligation to
any other party.
ARTICLE X
MISCELLANEOUS
10.01. COUNTERPARTS; ENTIRE AGREEMENT; CORPORATE POWER. (a)
This Agreement and each Ancillary Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when one or more counterparts have been signed by each of
the parties and delivered to the other party.
(b) This Agreement, and the Ancillary Agreements and the
Exhibits, Schedules and Appendices hereto and thereto contain the entire
agreement between the parties with respect to the subject matter hereof,
supersede all previous agreements, negotiations, discussions, writings,
understandings, commitments and conversations with respect to such subject
matter and there are no agreements or understandings between the parties other
than those set forth or referred to herein or therein.
(c) ATI represents on behalf of itself and each other member
of the ATI Group, and Teledyne Technologies represents on behalf of itself and
each other member of the Teledyne Technologies Group, as follows:
(i) each such Person has the requisite corporate or
other power and authority and has taken all corporate or other action
necessary in order to execute, deliver and
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perform each of this Agreement and each other Ancillary Agreements to
which it is a party and to consummate the transactions contemplated
hereby and thereby; and
(ii) this Agreement and each Ancillary Agreement to
which it is a party has been duly executed and delivered by it and
constitutes a valid and binding agreement of it enforceable in
accordance with the terms thereof.
(d) Each party hereto acknowledges that it and each other
party hereto may be executing certain of the Ancillary Agreements by facsimile,
stamp or mechanical signature. Each party hereto expressly adopts and confirms
each such facsimile, stamp or mechanical signature made in its respective name
as if it were a manual signature, agrees that it will not assert that any such
signature is not adequate to bind such party to the same extent as if it were
signed manually and agrees that at the reasonable request of any other party
hereto at any time it will as promptly as reasonably practicable cause each such
Ancillary Agreement to be manually executed (any such execution to be as of the
date of the initial date thereof).
10.02. GOVERNING LAW; CONSENT TO JURISDICTION. (a) This
Agreement and, unless expressly provided therein, each Ancillary Agreement,
shall be governed by and construed and interpreted in accordance with the laws
of the Commonwealth of Pennsylvania as to all matters, including matters of
validity, construction, effect, enforceability, performance and remedies,
irrespective of the choice of laws principles of the Commonwealth of
Pennsylvania.
(b) Each of the parties hereto irrevocably submits to the
exclusive jurisdiction of (i) the Court of Common Pleas of Allegheny County,
Pennsylvania and (ii) the United States District Court for the Western District
of Pennsylvania, for the purposes of any suit, action or other proceeding
arising out of this Agreement or any Ancillary Agreement or any transaction
contemplated hereby or thereby (and agrees not to commence any action, suit or
proceeding relating thereto except in such courts). Each of the parties hereto
further agrees that service of any process, summons, notice or document hand
delivered or sent by U.S. registered mail to such party's respective address set
forth in Section 10.05 will be effective service of process for any action, suit
or proceeding in Pennsylvania with respect to any matters to which it has
submitted to jurisdiction as set forth in the immediately preceding sentence.
Each of the parties hereto irrevocably and unconditionally waives any objection
to the laying of venue of any action, suit or proceeding arising out of this
Agreement or any Ancillary Agreement or the transactions contemplated hereby or
thereby in (i) the Court of Common Pleas of Allegheny County, Pennsylvania or
(ii) the United States District Court for the Western District of Pennsylvania,
and hereby further irrevocably and unconditionally waives and agrees not to
plead or claim in any such court that any such action, suit or proceeding
brought in any such court has been brought in an inconvenient forum.
10.03. ASSIGNABILITY. Except as set forth in any Ancillary
Agreement, this Agreement and each Ancillary Agreement shall be binding upon and
inure to the benefit of the parties hereto and thereto, respectively, and their
respective successors and assigns (including any direct or indirect assignee of
any of the Teledyne Technologies Assets); provided, however, that no party
hereto or thereto may assign its respective rights or delegate its respective
obligations
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under this Agreement or any Ancillary Agreement without the express prior
written consent of the other parties hereto or thereto.
10.04. THIRD PARTY BENEFICIARIES. Except for the
indemnification rights under this Agreement of any ATI Indemnitee, Teledyne
Technologies Indemnitee or Water Pik Indemnitee in their respective capacities
as such, (a) the provisions of this Agreement and each Ancillary Agreement are
solely for the benefit of the parties and are not intended to confer upon any
Person except the parties any rights or remedies hereunder, (b) there are no
third party beneficiaries of this Agreement or any Ancillary Agreement, and (c)
neither this Agreement nor any Ancillary Agreement shall provide any third
person with any remedy, claim, liability, reimbursement, claim of action or
other right in excess of those existing without reference to this Agreement or
any Ancillary Agreement. No party hereto shall have any right, remedy or claim
with respect to any provision of this Agreement or any Ancillary Agreement to
the extent such provision relates solely to the other two parties hereto or the
members of such other two parties' respective Groups. No party shall be required
to deliver any notice under this Agreement or under any Ancillary Agreement to
any other party with respect to any matter in which such other party has no
right, remedy or claim.
10.05. NOTICES. All notices or other communications under this
Agreement or any Ancillary Agreement shall be in writing and shall be deemed to
be duly given when (a) delivered in person or (b) deposited in the United States
mail or private express mail, postage prepaid, addressed as follows:
If to ATI, Holdings
or TII, to: Allegheny Teledyne Incorporated
0000 Xxx XXX Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attn: Senior Vice President,
General Counsel & Secretary
If to Teledyne
Technologies, to: Teledyne Technologies Incorporated
Attn:
Any party may, by notice to the other party, change the address to which such
notices are to be given.
10.06. SEVERABILITY. If any provision of this Agreement or any
Ancillary Agreement or the application thereof to any Person or circumstance is
determined by a court of competent jurisdiction to be invalid, void or
unenforceable, the remaining provisions hereof or thereof, or the application of
such provision to Persons or circumstances or in jurisdictions other than those
as to which it has been held invalid or unenforceable, shall remain in full
force and effect and shall in no way be affected, impaired or invalidated
thereby, so long as the economic or legal substance of the transactions
contemplated hereby or thereby, as the case may be, is not
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affected in any manner adverse to any party. Upon such determination, the
parties shall negotiate in good faith in an effort to agree upon such a suitable
and equitable provision to effect the original intent of the parties.
10.07. FORCE MAJEURE. No party shall be deemed in default of
this Agreement or any Ancillary Agreement to the extent that any delay or
failure in the performance of its obligations under this Agreement or any
Ancillary Agreement results from any cause beyond its reasonable control and
without its fault or negligence, such as acts of God, acts of civil or military
authority, embargoes, epidemics, war, riots, insurrections, fires, explosions,
earthquakes, floods, unusually severe weather conditions, labor problems or
unavailability of parts, or, in the case of computer systems, Year 2000 problems
or any failure in electrical or air conditioning equipment. In the event of any
such excused delay, the time for performance shall be extended for a period
equal to the time lost by reason of the delay.
10.08. HEADINGS. The article, section and paragraph headings
contained in this Agreement and in the Ancillary Agreements are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement or any Ancillary Agreement.
10.09. SURVIVAL OF COVENANTS. Except as expressly set forth in
any Ancillary Agreement, the covenants, representations and warranties contained
in this Agreement and each Ancillary Agreement, and liability for the breach of
any obligations contained herein, shall survive each of the Separation and the
Distribution and shall remain in full force and effect.
10.10. WAIVERS OF DEFAULT. Waiver by any party of any default
by the other party of any provision of this Agreement or any Ancillary Agreement
shall not be deemed a waiver by the waiving party of any subsequent or other
default, nor shall it prejudice the rights of the other party.
10.11. SPECIFIC PERFORMANCE. In the event of any actual or
threatened default in, or breach of, any of the terms, conditions and provisions
of this Agreement or any Ancillary Agreement, the party or parties who are or
are to be thereby aggrieved shall have the right to specific performance and
injunctive or other equitable relief of its rights under this Agreement or such
Ancillary Agreement, in addition to any and all other rights and remedies at law
or in equity, and all such rights and remedies shall be cumulative. The parties
agree that the remedies at law for any breach or threatened breach, including
monetary damages, are inadequate compensation for any loss and that any defense
in any action for specific performance that a remedy at law would be adequate is
waived. Any requirements for the securing or posting of any bond with such
remedy are waived.
10.12. AMENDMENTS. No provisions of this Agreement or any
Ancillary Agreement shall be deemed waived, amended, supplemented or modified by
any party, unless such waiver, amendment, supplement or modification is in
writing and signed by the authorized representative of the party against whom it
is sought to enforce such waiver, amendment, supplement or modification. Without
limiting the foregoing, the parties agree that any waiver, amendment, supplement
or modification of this Agreement or any Ancillary Agreement that solely
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relates to and affects only two of the three parties hereto shall not require
the consent of the third party hereto.
10.13. INTERPRETATION. Words in the singular shall be held to
include the plural and vice versa and words of one gender shall be held to
include the other genders as the context requires. The terms "hereof," "herein,"
and "herewith" and words of similar import shall, unless otherwise stated, be
construed to refer to this Agreement (or the applicable Ancillary Agreement) as
a whole (including all of the Schedules, Exhibits and Appendices hereto and
thereto) and not to any particular provision of this Agreement (or such
Ancillary Agreement). Article, Section, Exhibit, Schedule and Appendix
references are to the Articles, Sections, Exhibits, Schedules and Appendices to
this Agreement (or the applicable Ancillary Agreement) unless otherwise
specified. The word "including" and words of similar import when used in this
Agreement (or the applicable Ancillary Agreement) shall mean "including, without
limitation," unless the context otherwise requires or unless otherwise
specified. The word "or" shall not be exclusive. Unless expressly stated to the
contrary in this Agreement or in any Ancillary Agreement, all references to "the
date hereof," "the date of this Agreement," "hereby" and "hereupon" and words of
similar import shall all be references to __________, 1999, regardless of any
amendment or restatement hereof.
10.14. DISPUTES. (a) Resolution of any and all disputes
arising from or in connection with this Agreement other than those arising from
or in connection with Article IV of this Agreement, whether based on contract,
tort, statute or otherwise, including, but not limited to, disputes in
connection with claims by third parties (collectively, "Disputes"), shall be
subject to the provisions of this Section 10.14; provided, however, that nothing
contained herein shall preclude any party from seeking or obtaining (i)
injunctive relief or (ii) equitable or other judicial relief to enforce the
provisions hereof or to preserve the status quo pending resolution of Disputes
hereunder.
(b) Any party may give the other parties written notice of any
Dispute not resolved in the normal course of business. The parties shall attempt
in good faith to resolve any Dispute promptly by negotiation between executives
of the parties who have authority to settle the controversy. Within 15 days
after delivery of the notice, the foregoing executives of both parties shall
meet at a mutually acceptable time and place, and thereafter as often as they
reasonably deem necessary for a period not to exceed five days, to attempt to
resolve the Dispute. All reasonable requests for information made by one party
to the other will be honored. If the parties do not resolve the Dispute within
such 20 day period (the "Initial Mediation Period"), the parties shall attempt
in good faith to resolve the Dispute by negotiation between or among the
Designated Officers. The Designated Officers shall meet at a mutually acceptable
time and place (but in no event no later than 15 days following the expiration
of the Initial Mediation Period) and thereafter as often as they reasonably deem
necessary for a period not to exceed 15 days, to attempt to resolve the Dispute.
(c) If the Dispute has not been resolved by negotiation within
50 days of the first party's notice, or if the parties failed to meet within 15
days of the first party's notice, or if the Designated Officers failed to meet
within 35 days of the first party's notice, any party may commence any
litigation or other procedure allowed by law.
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10.15. EXCLUSIVITY OF TAX SHARING AGREEMENT. Notwithstanding
anything in this Agreement to the contrary, and subject to the provisions of
Article IV hereof, the Tax Sharing Agreement will be the exclusive agreement
among the parties with respect to all matters pertaining to Taxes, including,
without limitation, indemnification with respect to matters pertaining to Taxes
and indemnification with respect to the qualification of the Distribution as a
tax-free distribution under Section 355 and related provisions of the Code.
IN WITNESS WHEREOF, the parties have caused this Separation
and Distribution Agreement to be executed by their duly authorized
representatives.
ALLEGHENY TELEDYNE INCORPORATED
By:
--------------------------------------
Name:
Title:
TII HOLDINGS, LLC
By:
--------------------------------------
Name:
Title:
TELEDYNE INDUSTRIES, INC.
By:
--------------------------------------
Name:
Title:
TELEDYNE TECHNOLOGIES INCORPORATED
By:
--------------------------------------
Name:
Title:
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