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EXHIBIT 2.2
FORM OF
GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT
BETWEEN
QUANTUM CORPORATION
AND
SNAP APPLIANCES, INC.
________, 2000
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TABLE OF CONTENTS
PAGE
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ARTICLE I CONTRIBUTION AND ASSUMPTION............................................................1
Section 1.1 Contribution of Assets and Assumption of Liabilities........................1
Section 1.2 SNAP Assets.................................................................2
Section 1.3 SNAP Liabilities............................................................3
Section 1.4 Methods of Transfer and Assumption..........................................5
Section 1.5 Governmental Approvals and Consents.........................................6
Section 1.6 Nonrecurring Costs and Expenses.............................................6
Section 1.7 Novation of Assumed SNAP Liabilities........................................7
ARTICLE II LITIGATION............................................................................7
Section 2.1 Allocation..................................................................7
Section 2.2 Cooperation.................................................................8
ARTICLE III MISCELLANEOUS........................................................................8
Section 3.1 Entire Agreement............................................................8
Section 3.2 Governing Law...............................................................8
Section 3.3 Notices.....................................................................8
Section 3.4 Parties in Interest.........................................................9
Section 3.5 Counterparts................................................................9
Section 3.6 Assignment..................................................................9
Section 3.7 Severability................................................................9
Section 3.8 Failure or Indulgence Not Waiver; Remedies Cumulative.......................9
Section 3.9 Amendment..................................................................10
Section 3.10 Authority..................................................................10
Section 3.11 Interpretation.............................................................10
Section 3.12 Conflicting Agreements.....................................................10
ARTICLE IV DEFINITIONS..........................................................................10
Section 4.1 Quantum Group..............................................................10
Section 4.2 Action.....................................................................10
Section 4.3 Affiliated Company.........................................................10
Section 4.4 Ancillary Agreement........................................................11
Section 4.5 Assets.....................................................................11
Section 4.6 Contracts..................................................................12
Section 4.7 Delayed Transfer Assets....................................................12
Section 4.8 Distribution...............................................................12
Section 4.9 Distribution Date..........................................................12
Section 4.10 Governmental Approvals.....................................................13
Section 4.11 Governmental Authority.....................................................13
Section 4.12 Indemnification and Insurance Matters Agreement............................13
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TABLE OF CONTENTS
(CONTINUED)
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Section 4.13 Insurance Policies.........................................................13
Section 4.14 Insured SNAP Liabilities...................................................13
Section 4.15 Intellectual Property......................................................13
Section 4.16 IPO Registration Statement.................................................13
Section 4.17 Liabilities................................................................13
Section 4.18 OFLs.......................................................................14
Section 4.19 SNAP Balance Sheet.........................................................14
Section 4.20 SNAP Business..............................................................14
Section 4.21 SNAP Contingent Gain.......................................................14
Section 4.22 SNAP Contingent Liability..................................................15
Section 4.23 SNAP Contracts.............................................................15
Section 4.24 SNAP Group.................................................................16
Section 4.25 Person.....................................................................16
Section 4.26 Retained Payables..........................................................16
Section 4.27 Retained Receivables.......................................................16
Section 4.28 Security Interest..........................................................16
Section 4.29 Separation.................................................................17
Section 4.30 Separation Agreement.......................................................17
Section 4.31 Separation Date............................................................17
Section 4.32 Subsidiary.................................................................17
Section 4.33 Taxes......................................................................17
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SCHEDULES
Schedule 1.1(c) Delayed Transfer Assets and Liabilities
Schedule 1.2(a)(viii) Specific SNAP Assets to be Transferred
Schedule 1.2(b)(i) Excluded Assets
Schedule 1.3(a)(vi) Divested Businesses Which Contain Liabilities
to be Transferred to SNAP
Schedule 1.3(a)(vii) Specific SNAP Liabilities
Schedule 1.3(b)(i) Excluded Liabilities
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EXHIBIT C
GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT
This General Assignment and Assumption Agreement (this "AGREEMENT") is
entered into on ________, 2000 between Quantum Corporation, a Delaware
corporation ("QUANTUM"), and SNAP Appliances, Inc., a Delaware corporation
("SNAP"). Capitalized terms used herein and not otherwise defined herein shall
have the meanings ascribed to such terms in ARTICLE IV hereof.
RECITALS
WHEREAS, Quantum hereby and by certain other instruments of even date
herewith transfers or will transfer to SNAP effective as of the Separation Date,
certain assets of the SNAP Business owned by Quantum in accordance with the
Master Separation and Distribution Agreement dated as of October __, 2000
between Quantum and SNAP (the "SEPARATION AGREEMENT").
WHEREAS, it is further intended between the parties that SNAP assume
certain of the liabilities related to the SNAP Business currently owed by
Quantum, as provided in this Agreement, the Separation Agreement or the other
agreements and instruments provided for in the Separation Agreement.
NOW, THEREFORE, in consideration of the foregoing and the covenants and
agreements set forth below, the parties hereto agree as follows:
ARTICLE I
CONTRIBUTION AND ASSUMPTION
SECTION 1.1 CONTRIBUTION OF ASSETS AND ASSUMPTION OF LIABILITIES.
(a) Transfer of Assets. Effective on the Separation Date, Quantum
hereby assigns, transfers, conveys and delivers (or will cause any applicable
Subsidiary to assign, transfer, convey and deliver) to SNAP or to any applicable
SNAP Subsidiary, and SNAP hereby accepts from Quantum, or applicable Quantum
Subsidiary, and agrees to cause its applicable SNAP Subsidiary to accept, all of
Quantum's and its applicable Subsidiaries' respective right, title and interest
in SNAP Assets, other than the Delayed Transfer Assets; provided, however, that
any SNAP Assets that are specifically assigned or transferred pursuant to
another Ancillary Agreement shall not be assigned or transferred pursuant to
this SECTION 1.1(a).
(b) Assumption of Liabilities. Effective on the Separation Date, SNAP
hereby assumes and agrees faithfully to perform and fulfill (or will cause any
applicable Subsidiary to assume, perform and fulfill), all the SNAP Liabilities
owed by Quantum, other than the Delayed Transfer Liabilities, in accordance with
their respective terms. Thereafter, SNAP shall be responsible (or will cause any
applicable Subsidiary to be responsible) for all SNAP Liabilities held by
Quantum,
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regardless of when or where such Liabilities arose or arise, or whether the
facts on which they are based occurred prior to, on or after the date hereof,
regardless of where or against whom such Liabilities are asserted or determined
(including any SNAP Liabilities arising out of claims made by Quantum's or
SNAP's respective directors, officers, consultants, independent contractors,
employees or agents against any member of the Quantum Group or the SNAP Group)
or whether asserted or determined prior to the date hereof, and regardless of
whether arising from or alleged to arise from negligence, recklessness,
violation of law, fraud or misrepresentation by any member of the Quantum Group
or the SNAP Group or any of their respective directors, officers, employees or
agents.
(c) Delayed Transfer Assets and Liabilities. Each of the parties
hereto agrees that the Delayed Transfer Assets will be assigned, transferred,
conveyed and delivered, and the Delayed Transfer Liabilities will be assumed, in
accordance with the terms of the agreements that provide for such assignment,
transfer, conveyance and delivery, or such assumption, after the date of this
Agreement or as otherwise set forth on SCHEDULE 1.1(c). Following such
assignment, transfer, conveyance and delivery of any Delayed Transfer Asset, or
the assumption of any Delayed Transfer Liability, the applicable Delayed
Transfer Asset or Delayed Transfer Liability shall be treated for all purposes
of this Agreement and the other Ancillary Agreements as a SNAP Asset or as a
SNAP Liability, as the case may be.
(d) Misallocated Assets. In the event that at any time or from time
to time (whether prior to, on or after the Separation 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
Agreement or any Ancillary Agreement, such party 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.
(e) Payment. SNAP shall make a payment in cash to Quantum, or with
the consent of Quantum, treat as additional paid in capital, to the extent that
the value of transferred SNAP Assets exceed transferred SNAP Liabilities.
Similarly, Quantum shall make a payment in cash to SNAP to the extent that the
value of transferred SNAP Liabilities exceed transferred SNAP Assets. Book value
shall be used in measuring the value of the transferred SNAP Assets and SNAP
Liabilities, as the parties agree that book value is the best evidence of fair
market value of the transferred SNAP Assets and SNAP Liabilities.
SECTION 1.2 SNAP ASSETS.
(a) Included Assets. For purposes of this Agreement, "SNAP ASSETS"
shall mean (without duplication) the following Assets, except as otherwise
provided for in any other Ancillary Agreement or other express agreement of the
parties:
(i) all Assets reflected in the SNAP Balance Sheet, subject to
any dispositions of such Assets subsequent to the date of the SNAP Balance
Sheet;
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(ii) all Assets that have been written off, expensed or fully
depreciated that, had they not been written off, expensed or fully depreciated,
would have been reflected in the SNAP Balance Sheet in accordance with the
principles and accounting policies under which the SNAP Balance Sheet was
prepared;
(iii) all Assets acquired by Quantum or its Subsidiaries after
the date of the SNAP Balance Sheet that would be reflected in the consolidated
balance sheet of SNAP as of the Separation Date if such consolidated balance
sheet was prepared using the same principles and accounting policies under which
the SNAP Balance Sheet was prepared, including any business transaction
processing that may occur on Quantum systems on behalf of SNAP during the period
between separation date to initialization of the processing systems required by
SNAP;
(iv) all Assets that are used primarily by the SNAP Business at
the Separation Date but are not reflected in the SNAP Balance Sheet due to
mistake or omission; provided, however, that no Asset shall be a SNAP Asset
requiring any transfer by Quantum unless SNAP or its Subsidiaries have, on or
before the first anniversary of the Distribution Date, given Quantum or its
Subsidiaries notice that such Asset is a SNAP Asset;
(v) all SNAP Contingent Gains;
(vi) all SNAP Contracts;
(vii) to the extent permitted by law and subject to the
Indemnification and Insurance Matters Agreement, all rights of any member of the
SNAP Group under any of Quantum's Insurance Policies or other insurance policies
issued by Persons unaffiliated with Quantum; and
(viii) all Assets that are expressly contemplated by this
Agreement, the Separation Agreement or any other Ancillary Agreement (or
SCHEDULE 1.2(a)(viii) or any other Schedule hereto or thereto) as Assets to be
transferred to SNAP or any other member of the SNAP Group.
(b) Excluded Assets. For the purposes of this Agreement, "EXCLUDED
ASSETS" shall mean:
(i) the Assets listed or described on SCHEDULE 1.2(b)(i);
(ii) the Retained Receivables; and
(iii) any Assets that are expressly contemplated by the
Separation Agreement, this Agreement or any other Ancillary Agreement (or the
Schedules hereto or thereto) as Assets to be retained by Quantum or any other
member of the Quantum Group.
SECTION 1.3 SNAP LIABILITIES.
(a) Included Liabilities. For the purposes of this Agreement, "SNAP
LIABILITIES" shall mean (without duplication) the following Liabilities, except
as otherwise provided for in any other Ancillary Agreement or other express
agreement of the parties:
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(i) all Liabilities reflected in the SNAP Balance Sheet, subject
to any discharge of such Liabilities subsequent to the date of the SNAP Balance
Sheet;
(ii) all Liabilities of Quantum or its Subsidiaries that arise
after the date of the SNAP Balance Sheet that would be reflected in the
consolidated balance sheet of SNAP as of the Separation Date if such
consolidated balance sheet was prepared using the same principles and accounting
policies under which the SNAP Balance Sheet was prepared;
(iii) all Liabilities that are related primarily to the SNAP
Business at the Separation Date but are not reflected in the SNAP Balance Sheet
due to mistake or unintentional omission; provided, however, that no Liability
shall be considered as a SNAP Liability unless Quantum or its Subsidiaries, on
or before the first anniversary of the Distribution Date, has given SNAP or its
Subsidiaries notice that such Liability is a SNAP Liability;
(iv) all SNAP Contingent Liabilities;
(v) all Liabilities (other than Liabilities for Taxes), whether
arising before, on or after the Separation Date, primarily relating to, arising
out of or resulting from:
(1) the operation of the SNAP Business, as conducted at
any time prior to, on or after the Separation 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));
(2) the operation of any business conducted by any
member of the SNAP Group at any time after the Separation 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)); or
(3) any SNAP Assets;
(vi) 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 1.3(a)(vi); and
(vii) all Liabilities that are expressly contemplated by this
Agreement, SCHEDULE 1.3(a)(vii), the Separation Agreement or any other Ancillary
Agreement (or the Schedules hereto or thereto) as Liabilities to be assumed by
SNAP or any member of the SNAP Group, and all agreements, obligations and
Liabilities of any member of the SNAP Group under this Agreement or any of the
Ancillary Agreements.
The SNAP Liabilities shall not include the Excluded Liabilities referred to in
SECTION 1.3(b) below.
(b) Excluded Liabilities. For the purposes of this Agreement,
"EXCLUDED LIABILITIES" shall mean:
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(i) all Liabilities listed or described in SCHEDULE 1.3(b)(i);
(ii) the Retained Payables;
(iii) all Insured SNAP Liabilities;
(iv) all Liabilities that are expressly contemplated by this
Agreement, the Separation Agreement or any other Ancillary Agreement (or the
Schedules hereto or thereto) as Liabilities to be retained or assumed by Quantum
or any other member of the Quantum Group, and all agreements and obligations of
any member of the Quantum Group under the Separation Agreement, this Agreement
or any other Ancillary Agreement.
SECTION 1.4 METHODS OF TRANSFER AND ASSUMPTION.
(a) Terms of Other Ancillary Agreements Govern. The parties shall enter
into the other Ancillary Agreements of even date herewith. To the extent that
the transfer of any SNAP Asset or the assumption of any SNAP Liability is
expressly provided for by the terms of any other Ancillary Agreement, the terms
of such other Ancillary Agreement shall effect, and determine the manner of, the
transfer or assumption. It is the intent of the parties that pursuant to
SECTIONS 1.1, 1.2 AND 1.3, the transfer and assumption of all other SNAP Assets
and SNAP Liabilities, other than Delayed Transfer Assets and Delayed Transfer
Liabilities, shall be made effective as of the Separation Date.
(b) Mistaken Assignments and Assumptions. In addition to those transfers
and assumptions accurately identified and designated by the parties to take
place but which the parties are not able to effect prior to the Separation Date,
there may exist (i) Assets that the parties discover were, contrary to the
agreements between the parties, by mistake or omission, transferred to SNAP or
(ii) Liabilities that the parties discover were, contrary to the agreements
between the parties, by mistake or omission, assumed by SNAP. The parties shall
cooperate in good faith to effect the transfer or re-transfer of such Assets,
and/or the assumption or re-assumption of such Liabilities, to or by the
appropriate party and shall not use the determination that remedial actions need
to be taken to alter the original intent of the parties hereto with respect to
the Assets to be transferred to or Liabilities to be assumed by SNAP. Each party
shall reimburse the other or make other financial adjustments (e.g., without
limitation, cash reserves) or other adjustments to remedy any mistakes or
omissions relating to any of the Assets transferred hereby or any of the
Liabilities assumed hereby.
(c) Documents Relating to Other Transfers of Assets and Assumption of
Liabilities. In furtherance of the assignment, transfer and conveyance of SNAP
Assets and the assumption of SNAP Liabilities set forth in certain Ancillary
Agreements, simultaneously with the execution and delivery hereof or as promptly
as practicable thereafter, (i) Quantum shall execute and deliver, and shall
cause its Subsidiaries to execute and deliver, such 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 evidence
the transfer, conveyance and assignment of all of Quantum's and its
Subsidiaries' right, title and interest in and to the SNAP Assets to SNAP and
(ii) SNAP shall execute and deliver to Quantum and its Subsidiaries such
assumptions of contracts and other
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instruments of assumption as and to the extent necessary to evidence the valid
and effective assumption of the SNAP Liabilities by SNAP.
SECTION 1.5 GOVERNMENTAL APPROVALS AND CONSENTS.
(a) Transfer In Violation of Laws. If and to the extent that the valid,
complete and perfected transfer assignment or novation to the SNAP Group of any
SNAP Assets and SNAP Liabilities (or from the SNAP Group of any Non-SNAP Assets)
would be a violation of applicable laws or require any Consent or Governmental
Approval in connection with the Separation, the IPO or the Distribution, then,
unless Quantum shall otherwise determine, the transfer, assignment or novation
to or from the SNAP Group, as the case may be, of such SNAP Assets or Non-SNAP
Assets, respectively, shall be automatically deemed deferred and any such
purported transfer, assignment or novation 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
still be considered a SNAP Asset for purposes of determining whether any
Liability is a SNAP Liability; provided, however, that if such covenants or
Governmental Approvals have not been obtained within six months of the
Distribution Date, the parties will use their reasonable commercial efforts to
achieve an alternative solution in accordance with the parties' intentions.
(b) Transfers Not Consummated Prior to Separation Date. If the transfer,
assignment or novation of any Assets intended to be transferred or assigned
hereunder is not consummated prior to or on the Separation Date, whether as a
result of the provisions of SECTION 1.5(a) or for any other reason, then the
Person retaining such Asset 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 SNAP Assets (or such Non-SNAP 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 Separation
Date to the SNAP Group (or the Quantum Group, as the case may be). If and when
the Consents and/or Governmental Approvals, the absence of which caused the
deferral of transfer of any Asset pursuant to SECTION 1.5(a), are obtained, the
transfer of the applicable Asset shall be effected in accordance with the terms
of this Agreement and/or such other applicable Ancillary Agreement.
(c) Expenses. 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.
SECTION 1.6 NONRECURRING COSTS AND EXPENSES. Notwithstanding anything
herein to the contrary, any nonrecurring costs and expenses incurred by the
parties hereto to effect the transactions contemplated hereby which are not
allocated pursuant to the terms of the Separation
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Agreement, this Agreement or any other Ancillary Agreement shall be the
responsibility of the party which incurs such costs and expenses.
SECTION 1.7 NOVATION OF ASSUMED SNAP LIABILITIES.
(a) Reasonable Commercial Efforts. Each of Quantum and SNAP, at the
request of the other, shall use its reasonable commercial 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 rights and obligations under agreements, leases, licenses and
other obligations or Liabilities (including SNAP OFLs) of any nature whatsoever
that constitute SNAP Liabilities or to obtain in writing the unconditional
release of all parties to such arrangements other than any member of the SNAP
Group, so that, in any such case, SNAP and its Subsidiaries will be solely
responsible for such Liabilities; provided, however, that neither Quantum, SNAP
nor their Subsidiaries shall be obligated to pay any consideration therefor to
any third party from whom such consents, approvals, substitutions and amendments
are requested.
(b) Inability to Obtain Novation. If Quantum or SNAP is unable to
obtain, or to cause to be obtained, any such required consent, approval,
release, substitution or amendment, the applicable member of the Quantum Group
shall continue to be bound by such agreements, leases, licenses and other
obligations and, unless not permitted by law or the terms thereof (except to the
extent expressly set forth in this Agreement, the Separation Agreement or any
other Ancillary Agreement), SNAP shall, as agent or subcontractor for Quantum or
such other Person, as the case may be, pay, perform and discharge fully, or
cause to be paid, transferred or discharged all the obligations or other
Liabilities of Quantum or such other Person, as the case may be, thereunder from
and after the date hereof. Quantum shall, without further consideration, pay and
remit, or cause to be paid or remitted, to SNAP or its appropriate Subsidiary
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 obtained or such agreement, lease,
license or other rights or obligations shall otherwise become assignable or able
to be novated, Quantum 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 SNAP without payment of
further consideration and SNAP shall, without the payment of any further
consideration, assume such rights and obligations.
ARTICLE II
LITIGATION
SECTION 2.1 ALLOCATION. Notwithstanding any contrary provisions in the
Indemnification and Insurance Matters Agreement, on the Separation Date, the
responsibilities for management of the litigation identified in a litigation
disclosure letter (the "LITIGATION DISCLOSURE LETTER"), which will be delivered
by Quantum to SNAP on the Separation Date, shall be transferred in their
entirety from Quantum and its Subsidiaries to SNAP and its Subsidiaries. As of
the Separation Date and thereafter, SNAP shall manage the defense of such
litigation and shall cause its applicable Subsidiaries to do the same. Quantum
and its Subsidiaries must first obtain the prior consent of
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SNAP or its applicable Subsidiary for any action to be taken by Quantum and its
Subsidiaries subsequent to the Separation Date in connection with the litigation
identified in the Litigation Disclosure Letter, which consent cannot be
unreasonably withheld or delayed. All other matters relating to such litigation,
including but not limited to indemnification for such claims, shall be governed
by the provisions of the Indemnification and Insurance Matters Agreement.
SECTION 2.2 COOPERATION. Quantum and SNAP and their respective
Subsidiaries shall cooperate with each other in the defense of any litigation
covered under this ARTICLE II and afford to each other reasonable access upon
reasonable advance notice to witnesses and Information (other than Information
protected from disclosure by applicable privileges) that is reasonably required
to defend this litigation (as "INFORMATION" is defined pursuant to SECTION 5.4
of the Separation Agreement). The foregoing agreement to cooperate includes, but
is not limited to, an obligation to provide access to qualified assistance to
provide information, witnesses and documents to respond to discovery requests in
specific lawsuits. In such cases, cooperation shall be timely so that the party
responding to discovery may meet all court-imposed deadlines. The party
requesting information shall reimburse the party providing information
consistent with the terms of SECTION 5.4 of the Separation Agreement. The
obligations set forth in this paragraph are more clearly defined in SECTION 5.4
of the Separation Agreement.
ARTICLE III
MISCELLANEOUS
SECTION 3.1 ENTIRE AGREEMENT. This Agreement, the Separation Agreement,
the other Ancillary Agreements and the Exhibits and Schedules referenced or
attached hereto and thereto, constitute the entire agreement between the parties
with respect to the subject matter hereof and shall supersede all prior written
and oral and all contemporaneous oral agreements and understandings with respect
to the subject matter hereof.
SECTION 3.2 GOVERNING LAW. This Agreement shall be construed in
accordance with and all Disputes hereunder shall be governed by the laws of the
State of California, excluding its conflict of law rules and the United Nations
Convention on Contracts for the International Sale of Goods. The Superior Court
of Santa Xxxxx County and/or the United States District Court for the Northern
District of California shall have jurisdiction and venue over all Disputes
between the parties that are permitted to be brought in a court of law pursuant
to SECTION 5.8 of the Separation Agreement.
SECTION 3.3 NOTICES. Notices, offers, requests or other communications
required or permitted to be given by either party pursuant to the terms of this
Agreement shall be given in writing to the respective parties to the following
addresses:
if to Quantum:
Quantum Corporation
000 XxXxxxxx Xxxxxxxxx
Xxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxx
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Executive Vice President, Finance
Chief Financial Officer
if to SNAP:
SNAP Appliances, Inc.
0000 Xxxxx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx Xxxxxx
Chief Financial Officer
or to such other address as the party to whom notice is given may have
previously furnished to the other in writing as provided herein. Any notice
involving non-performance, termination, or renewal shall be sent by hand
delivery, recognized overnight courier or, within the United States, may also be
sent via certified mail, return receipt requested. All other notices may also be
sent by fax, confirmed by first class mail. All notices shall be deemed to have
been given and received on the earlier of actual delivery or three (3) days from
the date of postmark.
SECTION 3.4 PARTIES IN INTEREST. This Agreement, including the Exhibits
and Schedules hereto, and the other documents referred to herein, shall be
binding upon and inure solely to the benefit of each party hereto and their
legal representatives and successors, and nothing in this Agreement, express or
implied, is intended to confer upon any other Person any rights or remedies of
any nature whatsoever under or by reason of this Agreement.
SECTION 3.5 COUNTERPARTS. This Agreement, including the Exhibits and
Schedules hereto, and the other documents referred to herein, may be executed in
counterparts, each of which shall be deemed to be an original but all of which
shall constitute one and the same agreement.
SECTION 3.6 ASSIGNMENT. This Agreement shall inure to the benefit of and
be binding upon the parties hereto and their respective legal representatives
and successors. This Agreement may not be assigned by any party hereto, without
the other party's express written consent.
SECTION 3.7 SEVERABILITY. If any term or other provision of this
Agreement or the Exhibits or Schedules attached hereto is determined by a
nonappealable decision by a court, administrative agency or arbitrator to be
invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner materially
adverse to any party. Upon such determination that any term or other provision
is invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner to the end
that transactions contemplated hereby are fulfilled to the fullest extent
possible.
SECTION 3.8 FAILURE OR INDULGENCE NOT WAIVER; REMEDIES CUMULATIVE. No
failure or delay on the part of any party hereto in the exercise of any right
hereunder shall impair such right or be construed to be a waiver of, or
acquiescence in, any breach of any representation, warranty or
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agreement herein, nor shall any single or partial exercise of any such right
preclude other or further exercise thereof or of any other right. All rights and
remedies existing under this Agreement or the Schedules or Exhibits attached
hereto are cumulative to, and not exclusive of, any rights or remedies otherwise
available.
SECTION 3.9 AMENDMENT. No change or amendment will be made to this
Agreement except by an instrument in writing signed on behalf of each of the
parties to such agreement.
SECTION 3.10 AUTHORITY. Each of the parties hereto represents to the
other that (a) it has the corporate or other requisite power and authority to
execute, deliver and perform this Agreement, (b) the execution, delivery and
performance of this Agreement by it have been duly authorized by all necessary
corporate or other action, (c) it has duly and validly executed and delivered
this Agreement, and (d) this Agreement is a legal, valid and binding obligation,
enforceable against it in accordance with its terms subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and general equity principles.
SECTION 3.11 INTERPRETATION. The headings contained in this Agreement,
in any Exhibit or Schedule hereto and in the table of contents to this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Any capitalized term used in any Schedule or
Exhibit but not otherwise defined therein, shall have the meaning assigned to
such term in this Agreement. When a reference is made in this Agreement to an
Article or a Section, Exhibit or Schedule, such reference shall be to an Article
or Section of, or an Exhibit or Schedule to, this Agreement unless otherwise
indicated.
SECTION 3.12 CONFLICTING AGREEMENTS. In the event of conflict between
this Agreement and any other Ancillary Agreement or other agreement executed in
connection herewith, the provisions of such other agreement shall prevail (other
than (i) as otherwise provided herein and (ii) the Separation Agreement).
ARTICLE IV
DEFINITIONS
SECTION 4.1 QUANTUM GROUP. "QUANTUM GROUP" means Quantum, each
Subsidiary and Affiliated Company of Quantum (other than any member of the SNAP
Group) immediately after the Separation Date and each Person that becomes a
Subsidiary or Affiliate Company of Quantum after the Separation Date.
SECTION 4.2 ACTION. "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.
SECTION 4.3 AFFILIATED COMPANY. "AFFILIATED COMPANY" 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
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the management and policies of such entity, whether through ownership of voting
securities or other interests, by contract or otherwise.
SECTION 4.4 ANCILLARY AGREEMENT. "ANCILLARY AGREEMENT" has the meaning
set forth in SECTION 2.1 of the Separation Agreement.
SECTION 4.5 ASSETS. "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:
(i) all accounting and other books, records and files whether in
paper, microfilm, microfiche, computer tape or disc, magnetic tape or any other
form;
(ii) all apparatus, computers and other electronic data
processing equipment, automobiles, trucks, aircraft, rolling stock, vessels,
motor vehicles and other transportation equipment, special and general tools,
test devices, prototypes and models and other tangible personal property, but
excluding fixtures, machinery, equipment, furniture and office equipment;
(iii) all inventories of materials, parts, raw materials,
supplies, work-in-process and finished goods and products;
(iv) all interests in real property of whatever nature,
including easements, whether as owner, mortgagee or holder of a Security
Interest, lessor, sublessor, lessee, sublessee or otherwise;
(v) 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;
(vi) 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;
(vii) all deposits, letters of credit and performance and surety
bonds;
(viii) 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;
(ix) all Intellectual Property and licenses from third Persons
granting the right to use any Intellectual Property;
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(x) all computer applications, programs and other software,
including operating software, network software, firmware, middleware, design
software, design tools, systems documentation and instructions;
(xi) 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;
(xii) all prepaid expenses, trade accounts and other accounts
and notes receivables;
(xiii) 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 claims, choses in action or similar
rights, whether accrued or contingent;
(xiv) all rights under insurance policies and all rights in the
nature of insurance, indemnification or contribution;
(xv) all licenses (including radio and similar licenses),
permits, approvals and authorizations which have been issued by any Governmental
Authority;
(xvi) cash or cash equivalents, bank accounts, lock boxes and
other deposit arrangements; and
(xvii) interest rate, currency, commodity or other swap, collar,
cap or other hedging or similar agreements or arrangements.
SECTION 4.6 CONTRACTS. "CONTRACTS" means any contract, agreement, lease,
license, sales order, purchase order, instrument or other commitment that is
binding on any Person or any part of its property under applicable law.
SECTION 4.7 DELAYED TRANSFER ASSETS. "DELAYED TRANSFER ASSETS" means any
SNAP Assets that are expressly provided in this Agreement, the Separation
Agreement or any other Ancillary Agreement to be transferred after the date of
this Agreement.
SECTION 4.8 DISTRIBUTION. "DISTRIBUTION" means Quantum's pro rata
distribution to the holders of its DLT & Storage Systems Group common stock, or
such other class of stock into which the Quantum DLT & Storage Systems Group
common stock may have been converted, following the IPO as provided in the
Separation Agreement, of all of the shares of SNAP common stock owned by
Quantum.
SECTION 4.9 DISTRIBUTION DATE. "DISTRIBUTION DATE" has the meaning set
forth in Section 4.1 of the Separation Agreement.
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SECTION 4.10 GOVERNMENTAL APPROVALS. "GOVERNMENTAL APPROVALS" means any
notices, reports or other filings to be made, or any consents, registrations,
approvals, permits or authorizations to be obtained from, any Governmental
Authority.
SECTION 4.11 GOVERNMENTAL AUTHORITY. "GOVERNMENTAL AUTHORITY" means any
federal, state, local, foreign or international court, government, department,
commission, board, bureau, agency, official or other regulatory, administrative
or governmental authority.
SECTION 4.12 INDEMNIFICATION AND INSURANCE MATTERS AGREEMENT.
"Indemnification and Insurance Matters Agreement" means the Indemnification and
Insurance Matters Agreement attached as Exhibit H to the Separation Agreement.
SECTION 4.13 INSURANCE POLICIES. "INSURANCE POLICIES" means insurance
policies pursuant to which a Person makes a true risk transfer to an insurer.
SECTION 4.14 INSURED SNAP LIABILITIES. "INSURED SNAP LIABILITIES" means
any SNAP Liability to the extent that (i) it is covered under the terms of
Quantum's Insurance Policies in effect prior to the Distribution Date and (ii)
SNAP is not a named insured under, or otherwise entitled to the benefits of,
such Insurance Policies.
SECTION 4.15 INTELLECTUAL PROPERTY. "INTELLECTUAL PROPERTY" means all
domestic and foreign patents and patent applications, together with any
continuations, continuations-in-part or divisional applications thereof, and all
patents issuing thereon (including reissues, renewals and re-examinations of the
foregoing); design patents, invention disclosures; mask works; copyrights, and
copyright applications and registrations; Web addresses, trademarks, service
marks, trade names, and trade dress, in each case together with any applications
and registrations therefor and all appurtenant goodwill relating thereto; trade
secrets, commercial and technical information, know-how, proprietary or
confidential information, including engineering, production and other designs,
notebooks, processes, drawings, specifications, formulae, and technology;
computer and electronic data processing programs and software (object and source
code), data bases and documentation thereof; inventions (whether patented or
not); utility models; registered designs, certificates of invention and all
other intellectual property under the laws of any country throughout the world.
SECTION 4.16 IPO REGISTRATION STATEMENT. "IPO REGISTRATION STATEMENT"
means the registration statement on Form S-1 pursuant to the Securities Act of
1933, as amended, to be filed with the Securities and Exchange Commission
registering the shares of common stock of SNAP to be issued in the initial
public offering, together with all amendments thereto.
SECTION 4.17 LIABILITIES. "LIABILITIES" means all debts, liabilities,
guarantees, assurances, commitments and obligations, whether fixed, contingent
or absolute, asserted or unasserted, matured or unmatured, liquidated or
unliquidated, accrued or not accrued, known or unknown, due or to become due,
whenever or however arising (including, without limitation, whether arising out
of any Contract or tort based on negligence or strict liability) and whether or
not the same would be required by generally accepted principles and accounting
policies to be reflected in financial statements or disclosed in the notes
thereto.
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SECTION 4.18 OFLS. "OFLS" mean all liabilities, obligations,
contingencies, instruments and other Liabilities of any member of the Quantum
Group, or SNAP Group, as appropriate, of a financial nature with third parties
existing on the date hereof or entered into or established between the date
hereof and the Separation Date, including any of the following:
(i) foreign exchange contracts;
(ii) letters of credit;
(iii) guarantees of third party loans to customers;
(iv) surety bonds (excluding surety for workers' compensation
self-insurance);
(v) interest support agreements on third party loans to
customers;
(vi) performance bonds or guarantees issued by third parties;
(vii) swaps or other derivatives contracts; and
(viii) recourse arrangements on the sale of receivables or
notes.
SECTION 4.19 SNAP BALANCE SHEET. "SNAP BALANCE SHEET" means the audited
consolidated balance sheet (including the notes thereto) of the SNAP Business as
of December 31, 1999, that is included in the IPO Registration Statement.
SECTION 4.20 SNAP BUSINESS. "SNAP BUSINESS" means the business and
operations of the business of SNAP as described in the IPO Registration
Statement and, except as otherwise expressly provided herein, any terminated,
divested or discontinued businesses or operations that at the time of
termination, divestiture or discontinuation primarily related to the SNAP
Business as then conducted.
SECTION 4.21 SNAP CONTINGENT GAIN. "SNAP CONTINGENT GAIN" means any
claim or other right of a member of the Quantum Group or the SNAP Group that
primarily relates to the SNAP Business, whenever arising, against any Person
other than a member of the Quantum Group or the SNAP Group, if and to the extent
that (i) such claim or right arises out of the events, acts or omissions
occurring as of the Separation Date (based on then existing law) and (ii) the
existence or scope of the obligation of such other Person as of the Separation
Date was not acknowledged, fixed or determined in any material respect, due to a
dispute or other uncertainty as of the Separation Date or as a result of the
failure of such claim or other right to have been discovered or asserted as of
the Separation Date. A claim or right meeting the foregoing definition shall be
considered a SNAP Contingent Gain regardless of whether there was any Action
pending, threatened or contemplated as of the Separation Date with respect
thereto. In the case of any claim or right a portion of which arises out of
events, acts or omissions occurring prior to the Separation Date and a portion
of which arises out of events, acts or omissions occurring on or after the
Separation Date, only that portion that arises out of events, acts or omissions
occurring prior to the Separation Date shall be considered
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a SNAP Contingent Gain. For purposes of the foregoing, a claim or right shall be
deemed to have accrued as of the Separation Date if all the elements of the
claim necessary for its assertion shall have occurred on or prior to the
Separation Date, such that the claim or right, were it asserted in an Action on
or prior to the Separation Date, would not be dismissed by a court on ripeness
or similar grounds. Notwithstanding the foregoing, none of (i) any Insurance
Proceeds, (ii) any Excluded Assets, (iii) any reversal of any litigation or
other reserve, or (iv) any matters relating to Taxes (which are governed by the
Tax Sharing Agreement) shall be deemed to be a SNAP Contingent Gain.
SECTION 4.22 SNAP CONTINGENT LIABILITY. "SNAP CONTINGENT LIABILITY"
means any Liability, other than Liabilities for Taxes (which are governed by the
Tax Sharing Agreement), of a member of the Quantum Group or the SNAP Group that
primarily relates to the SNAP Business, whenever arising, to any Person other
than a member of the Quantum Group or the SNAP Group, if and to the extent that
(i) such Liability arises out of the events, acts or omissions occurring as of
the Separation Date and (ii) the existence or scope of the obligation of a
member of the Quantum Group or the SNAP Group as of the Separation Date with
respect to such Liability was not acknowledged, fixed or determined in any
material respect, due to a dispute or other uncertainty as of the Separation
Date or as a result of the failure of such Liability to have been discovered or
asserted as of the Separation Date (it being understood that the existence of a
litigation or other reserve with respect to any Liability shall not be
sufficient for such Liability to be considered acknowledged, fixed or
determined). In the case of any Liability a portion of which arises out of
events, acts or omissions occurring prior to the Separation Date and a portion
of which arises out of events, acts or omissions occurring on or after the
Separation Date, only that portion that arises out of events, acts or omissions
occurring prior to the Separation Date shall be considered a SNAP Contingent
Liability. For purposes of the foregoing, a Liability shall be deemed to have
arisen out of events, acts or omissions occurring prior to the Separation Date
if all the elements necessary for the assertion of a claim with respect to such
Liability shall have occurred on or prior to the Separation Date, such that the
claim, were it asserted in an Action on or prior to the Separation Date, would
not be dismissed by a court on ripeness or similar grounds. For purposes of
clarification of the foregoing, the parties agree that no Liability relating to,
arising out of or resulting from any obligation of any Person to perform the
executory portion of any contract or agreement existing as of the Separation
Date, or to satisfy any obligation accrued under any Plan (as defined in the
Employee Matters Agreement) as of the Separation Date, shall deemed to be a SNAP
Contingent Liability. For purposes of determining whether a claim relating to
the Year 2000 problem is a SNAP Contingent Liability, claims relating to
products shipped prior to the Separation Date shall be deemed to have arisen
prior to the Separation Date.
SECTION 4.23 SNAP CONTRACTS. "SNAP CONTRACTS" means the following
contracts and agreements to which Quantum is a party or by which it or any of
its Assets is bound, whether or not in writing, except for any such contract or
agreement that is contemplated to be retained by Quantum or any member of the
Quantum Group pursuant to any provision of this Agreement or any other Ancillary
Agreement:
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(i) any contract or agreement entered into in the name of, or
expressly on behalf of, any division or business unit of SNAP;
(ii) any contract or agreement that relates primarily to the
SNAP Business;
(iii) any contract or agreement that is otherwise expressly
contemplated pursuant to this Agreement, the Separation Agreement or any of the
other Ancillary Agreements to be assigned to SNAP;
(iv) any guarantee, indemnity, representation, warranty or other
Liability of any member of the SNAP Group or the Quantum Group in respect of any
other SNAP Contract, any SNAP Liability or the SNAP Business (including
guarantees of financing incurred by customers or other third parties in
connection with purchases of products or services from the SNAP Business); and
(v) any SNAP OFL.
SECTION 4.24 SNAP GROUP. "SNAP GROUP" means SNAP, each Subsidiary and
Affiliated Company of SNAP immediately after the Separation Date and each Person
that becomes a Subsidiary or Affiliate Company of SNAP after the Separation
Date.
SECTION 4.25 PERSON. "PERSON" means an individual, a partnership, a
corporation, a limited liability company, an association, a joint stock company,
a trust, a joint venture, an unincorporated organization and a governmental
entity or any department, agency or political subdivision thereof.
SECTION 4.26 RETAINED PAYABLES. "RETAINED PAYABLES" means (i) all
accounts payable and other obligations of payment for goods or services
purchased, leased or otherwise received in the conduct of the SNAP Business that
as of the Separation Date are payable to a third Person by Quantum or any of
Quantum's Subsidiaries, other than SNAP, whether past due, due or to become due,
including any interest, sales or use taxes, finance charges, late or returned
check charges and other obligations of Quantum or any of Quantum's Subsidiaries
with respect thereto, and any obligations related to any of the foregoing and
(ii) all employee compensation Liabilities and other miscellaneous Liabilities
for which an adjustment may be required.
SECTION 4.27 RETAINED RECEIVABLES. "RETAINED RECEIVABLES" means (i) all
accounts receivable and other rights to payment for goods or services sold,
leased or otherwise provided in the conduct of the SNAP Business that as of the
Separation Date are payable by a third Person to Quantum or any of Quantum's
Subsidiaries, other than SNAP, whether past due, due or to become due, including
any interest, sales or use taxes, finance charges, late or returned check
charges and other obligations of the account debtor with respect thereto, and
any proceeds of any of the foregoing and (ii) all other miscellaneous Assets for
which an adjustment may be required.
SECTION 4.28 SECURITY INTEREST. "SECURITY INTEREST" means any mortgage,
security interest, pledge, lien, charge, claim, option, right to acquire, voting
or other restriction, right-of-way,
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covenant, condition, easement, encroachment, restriction on transfer, or other
encumbrance of any nature whatsoever.
SECTION 4.29 SEPARATION. "SEPARATION" means the transfer and
contribution from Quantum to SNAP, and SNAP's receipt and assumption of,
directly or indirectly, substantially all of the Assets and Liabilities
currently associated with the SNAP Business and the stock, investments or
similar interests currently held by Quantum in subsidiaries and other entities
that conduct such business.
SECTION 4.30 SEPARATION AGREEMENT. "SEPARATION AGREEMENT" means the
Master Separation and Distribution Agreement dated as of October __, 2000, of
which this is an Exhibit thereto.
SECTION 4.31 SEPARATION DATE. "SEPARATION DATE" means the effective date
and time of each transfer of property, assumption of liability, license,
undertaking, or agreement in connection with the Separation, which shall be
12:01 a.m., Pacific Time, _________________________, or such date as may be
fixed by the Board of Directors of Quantum.
SECTION 4.32 SUBSIDIARY. "SUBSIDIARY" of any Person means any
corporation or other organization whether incorporated or unincorporated of
which at least a majority of the securities or interest 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.
SECTION 4.33 TAXES. "TAXES" has the meaning set forth in the Tax Sharing
Agreement.
[SIGNATURES ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, each of the parties has caused this General
Assignment and Assumption Agreement to be executed on its behalf by its officers
thereunto duly authorized on the day and year first above written.
QUANTUM CORPORATION SNAP APPLIANCES, INC.
By: By:
-------------------------- --------------------------
Name: Name:
------------------------ ------------------------
Title: Title:
----------------------- -----------------------
23
SCHEDULE 1.1(c) DELAYED TRANSFER ASSETS AND LIABILITIES
NOT APPLICABLE.
24
SCHEDULE 1.2(a)(viii) SPECIFIC SNAP ASSETS TO BE TRANSFERRED
NOT APPLICABLE.
25
SCHEDULE 1.2(b)(i) EXCLUDED ASSETS
NOT APPLICABLE.
26
SCHEDULE 1.3(a)(vii) SPECIFIC SNAP LIABILITIES
NOT APPLICABLE.
27
SCHEDULE 1.3(b)(i) EXCLUDED LIABILITIES
NOT APPLICABLE.
