EXHIBIT 2.2
GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT
BETWEEN
LSI LOGIC CORPORATION
AND
LSI LOGIC STORAGE SYSTEMS, INC.
DECEMBER 31, 2003
TABLE OF CONTENTS
PAGE
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ARTICLE I CONTRIBUTION AND ASSUMPTION............................. 1
1.1 Contribution of Assets and Assumption of Liabilities........ 1
1.2 SSI Assets.................................................. 2
1.3 SSI Liabilities............................................. 2
1.4 Methods of Transfer and Assumption.......................... 3
1.5 Governmental Approvals and Consents......................... 4
1.6 Nonrecurring Costs and Expenses............................. 5
1.7 Novation of Assumed SSI Liabilities......................... 5
1.8 Shared Contracts and Certain SSI Contracts.................. 5
1.9 LSI Logic Contracts......................................... 6
ARTICLE II MISCELLANEOUS.......................................... 6
2.1 Limitation of Liability..................................... 6
2.2 Entire Agreement............................................ 6
2.3 Governing Law............................................... 6
2.4 Dispute Resolution.......................................... 6
2.5 Notices..................................................... 6
2.6 Counterparts................................................ 7
2.7 Binding Effect; Assignment.................................. 7
2.8 Severability................................................ 7
2.9 Failure or Indulgence Not Waiver; Remedies Cumulative....... 7
2.10 Amendment................................................... 7
2.11 Interpretation.............................................. 7
2.12 Conflicting Agreements...................................... 8
ARTICLE III DEFINITIONS........................................... 8
3.1 Action...................................................... 8
3.2 Ancillary Agreement......................................... 8
3.3 Assets...................................................... 8
3.4 Contracts................................................... 9
3.5 Dispute..................................................... 9
3.6 Distribution................................................ 9
3.7 Distribution Date........................................... 9
3.8 Employee Matters Agreement.................................. 9
3.9 Excluded Assets............................................. 9
3.10 Excluded Liabilities........................................ 9
3.11 Governmental Approvals...................................... 9
3.12 Governmental Authority...................................... 9
3.13 Indemnification and Insurance Matters Agreement............. 9
3.14 Insurance Policies.......................................... 9
3.15 IP.......................................................... 9
3.16 Intellectual Property Agreement............................. 9
3.17 LSI Logic Contracts......................................... 9
3.18 LSI Logic Employees......................................... 9
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PAGE
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3.19 LSI Logic Employment Liabilities............................ 10
3.20 LSI Logic Group............................................. 10
3.21 LSI Logic Storage Business.................................. 10
3.22 Liabilities................................................. 10
3.23 Non-US Plan................................................. 10
3.24 Other Financial Liabilities................................. 10
3.25 Person...................................................... 10
3.26 Restriction................................................. 10
3.27 Security Interest........................................... 10
3.28 Separation.................................................. 10
3.29 Separation Agreement........................................ 10
3.30 Separation Date............................................. 10
3.31 Shared Contracts............................................ 10
3.32 SSI Assets.................................................. 11
3.33 SSI Balance Sheet........................................... 11
3.34 SSI Business................................................ 11
3.35 SSI Contingent Gain......................................... 11
3.36 SSI Contingent Liability.................................... 11
3.37 SSI Contracts............................................... 12
3.38 SSI Employees............................................... 12
3.39 SSI Employment Liabilities.................................. 12
3.40 SSI Group................................................... 12
3.41 SSI Liabilities............................................. 12
3.42 SSI Payables................................................ 12
3.43 SSI Receivables............................................. 12
3.44 Subsidiary.................................................. 12
3.45 Taxes....................................................... 12
3.46 Tax Sharing Agreement....................................... 13
3.47 Transition Services Agreement............................... 13
SCHEDULES
Schedule 1.2(a)(i) Specific SSI Assets to be Transferred
Schedule 1.2(b)(i) Specific Excluded Assets
Schedule 1.3(a)(i) Specific SSI Liabilities
Schedule 1.3(a)(ix) Divested Businesses Which Contain Liabilities to be
Transferred to SSI
Schedule 1.3(b)(i) Specific Excluded Liabilities
Schedule 3.17 LSI Logic Contracts
Schedule 3.31 Shared Contracts
Schedule 3.37 SSI Contracts
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GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT
This
General Assignment and Assumption Agreement (this "Agreement") is
entered into as of December 31, 2003 between LSI Logic Corporation, a Delaware
corporation ("LSI Logic"), and LSI Logic Storage Systems, Inc., a Delaware
corporation ("SSI"). Capitalized terms used herein and not otherwise defined
herein shall have the meanings ascribed to such terms in Article III hereof.
RECITALS
1. LSI Logic and SSI are entering into a Master Separation Agreement dated
as of December 31, 2003 (the "Separation Agreement") and other Ancillary
Agreements to delineate and clarify their relationship and further separate the
businesses conducted by LSI Logic and SSI (the "Separation").
2. In connection with the Separation, the parties wish to clarify that LSI
Logic has no continuing rights and obligations in certain Assets and Liabilities
related to the SSI Business, and LSI Logic and SSI desire that LSI Logic
contribute to SSI any right, title or interest that it holds in any such Asset
and that SSI assume any LSI Logic obligation with respect to any such Liability.
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
1.1 Contribution of Assets and Assumption of Liabilities.
(a) Transfer of Assets. To the extent LSI Logic has any right, title or
interest in any SSI Asset, effective on the Separation Date, LSI Logic hereby
assigns, transfers, conveys and delivers (or shall cause any applicable
Subsidiary to assign, transfer, convey and deliver) to SSI or to any applicable
SSI Subsidiary, and SSI hereby accepts from LSI Logic, or applicable LSI Logic
Subsidiary, and agrees to cause its applicable SSI Subsidiary to accept, all of
LSI Logic's and its applicable Subsidiaries' respective right, title and
interest, if any, in each SSI Asset, provided, however, that any SSI Assets that
are specifically assigned or transferred pursuant to another Ancillary
Agreement, including but not limited to any Assets assigned or transferred
pursuant to the Intellectual Property Agreement, shall not be assigned or
transferred pursuant to this Section 1.1(a). Any transfers of SSI Assets are
intended to be treated as capital contributions for federal income tax purposes.
(b) Assumption of Liabilities. Effective on the Separation Date, to the
extent LSI Logic has any responsibility or liability with respect to the SSI
Liabilities, SSI hereby assumes and agrees to perform and fulfill (or shall
cause any applicable Subsidiary to assume, perform and fulfill) all the SSI
Liabilities in accordance with their respective terms. Thereafter, SSI shall be
responsible (or shall cause any applicable Subsidiary to be responsible) for,
and shall perform and fulfill, all SSI Liabilities, 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 SSI Liabilities
arising out of claims made by LSI Logic's or SSI's respective directors,
officers, consultants, independent contractors, employees or agents against any
member of the LSI Logic Group or the SSI 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 LSI Logic Group or the SSI Group or any
of their respective directors, officers, employees or agents.
(c) Misallocated Assets. Unless otherwise governed by the provisions of
the Intellectual Property Agreement, 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 retain, 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 retaining, receiving or
possessing such Asset shall hold such Asset in trust for any such other Person.
1.2 SSI Assets.
(a) Included Assets. For purposes of this Agreement, "SSI Assets" shall
mean (without duplication) the following Assets, except as otherwise provided
for in any other Ancillary Agreement:
(i) all Assets that are expressly listed on Schedule 1.2(a)(i);
(ii) all Assets reflected in the SSI Balance Sheet, subject to any
dispositions of such Assets subsequent to the date of the SSI Balance
Sheet;
(iii) all Assets that are used primarily by the SSI Business at the
Separation Date 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 SSI Balance Sheet in accordance with the
principles and accounting policies under which the SSI Balance Sheet was
prepared;
(iv) all Assets that are used primarily by the SSI Business acquired
or received by LSI Logic or its Subsidiaries after the date of the SSI
Balance Sheet that, had such Assets been acquired or received prior to the
date of the SSI Balance Sheet, would have been reflected in SSI Balance
Sheet in accordance with the principles and accounting policies under which
the SSI Balance Sheet was prepared;
(v) all Assets that are used primarily by the SSI Business at the
Separation Date but are not reflected in the SSI Balance Sheet due to
mistake or unintentional omission; provided, however, that no Asset shall
be an SSI Asset requiring any transfer by LSI Logic unless SSI or its
Subsidiaries have, on or before the second anniversary of the Separation
Date, given LSI Logic or its Subsidiaries notice that such Asset is an SSI
Asset;
(vi) all SSI Contingent Gains;
(vii) all SSI Contracts;
(viii) all SSI Receivables;
(ix) to the extent permitted by law and subject to the Indemnification
and Insurance Matters Agreement, all rights of any member of the SSI Group
under any of LSI Logic's Insurance Policies or other insurance policies
issued by Persons unaffiliated with LSI Logic; and
(x) all other Assets that are expressly contemplated by this
Agreement, the Separation Agreement or any other Ancillary Agreement (or
any other exhibit or schedule hereto or thereto) as Assets to be
transferred to SSI or any other member of the SSI Group.
Notwithstanding the foregoing, the SSI Assets shall not include the Excluded
Assets referred to in Section 1.2(b) below.
(b) Excluded Assets. For the purposes of this Agreement, "Excluded Assets"
shall mean:
(i) all Assets that are expressly listed or described on Schedule
1.2(b)(i); and
(ii) all other Assets that are expressly contemplated by the
Separation Agreement, this Agreement or any other Ancillary Agreement (or
the exhibits or schedules hereto or thereto) as Assets to be retained by
LSI Logic or any other member of the LSI Logic Group.
1.3 SSI Liabilities.
(a) Included Liabilities. For the purposes of this Agreement, "SSI
Liabilities" shall mean (without duplication) the following Liabilities, except
as otherwise provided for in any other Ancillary Agreement:
(i) all Liabilities that are expressly listed on Schedule 1.3(a)(i);
(ii) all Liabilities reflected in the SSI Balance Sheet, subject to
any discharge of such Liabilities subsequent to the date of the SSI Balance
Sheet;
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(iii) all Liabilities of LSI Logic or its Subsidiaries that arise
after the date of the SSI Balance Sheet that, had such Liability arisen
before the date of the SSI Balance Sheet, would have been reflected in the
SSI Balance Sheet in accordance with the same principles and accounting
policies under which the SSI Balance Sheet was prepared, including any such
Liabilities that are related primarily to the Assets described in Section
1.2(a)(iii) and Section 1.2(a)(iv);
(iv) all Liabilities that are related primarily to the SSI Business at
the Separation Date but are not reflected in the SSI Balance Sheet due to
mistake or unintentional omission; provided, however, that no Liability
shall be an SSI Liability unless LSI Logic or its Subsidiaries, on or
before the second anniversary of the Separation Date, has given SSI or its
Subsidiaries notice that such Liability is an SSI Liability;
(v) all SSI Contingent Liabilities;
(vi) all SSI Payables;
(vii) all SSI Employment Liabilities;
(viii) all Liabilities whether arising before, on or after the
Separation Date, primarily relating to, arising out of or resulting from:
(1) the operation of the SSI 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 of LSI Logic
or any LSI Logic Subsidiary, including SSI (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
SSI 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 of LSI Logic
or any LSI Logic Subsidiary, including SSI (whether or not such act or
failure to act is or was within such Person's authority)); or
(3) any SSI Assets;
(ix) 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)(ix); and
(x) all other Liabilities that are expressly contemplated by this
Agreement, the Separation Agreement or any other Ancillary Agreement (or
the exhibits or schedules hereto or thereto) as Liabilities to be retained
or assumed by SSI or any member of the SSI Group, and all agreements,
obligations and Liabilities of any member of the SSI Group under this
Agreement or any of the Ancillary Agreements.
Notwithstanding the foregoing, the SSI 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:
(i) all Liabilities that are expressly listed or described in Schedule
1.3(b)(i); and
(ii) all other Liabilities that are expressly contemplated by this
Agreement, the Separation Agreement or any other Ancillary Agreement (or
the exhibits or schedules hereto or thereto) as Liabilities to be retained
or assumed by LSI Logic or any other member of the LSI Logic Group, all LSI
Logic Employment Liabilities and all agreements and obligations of any
member of the LSI Logic Group under the Separation Agreement, this
Agreement or any other Ancillary Agreement.
1.4 Methods of Transfer and Assumption.
(a) Terms of Other Ancillary Agreements Govern. The parties shall enter
into the other Ancillary Agreements on or about the date of this Agreement, or
as soon thereafter as practicable. To the extent that the
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transfer of any SSI Asset or the assumption of any SSI Liability is expressly
provided for by the terms of any other Ancillary Agreement (including by not
limited to any Assets allocated, assigned or transferred pursuant to the
Intellectual Property Agreement), the terms of such other Ancillary Agreement
shall effect and determine the manner of, such transfer or assumption. The
transfer and assumption of all SSI Assets and SSI Liabilities hereunder shall be
made effective as of the Separation Date; provided, however, the transactions
contemplated by the Non-US Plan may require the transfer of certain Assets and
the assumption of certain Liabilities to occur in such other manner and at such
other time as shall be set forth in the Non-US Plan.
(b) Mistaken Assignments and Assumptions. With respect to (i) Assets that
the parties determine were transferred to SSI in contravention of this Agreement
or the other Ancillary Agreements, or (ii) Liabilities that the parties
determine were assumed by SSI in contravention of this Agreement or the other
Ancillary Agreements, the parties shall cooperate in good faith to effect as
promptly as practicable the transfer or re-transfer of such Assets, and/or the
assumption or re-assumption of such Liabilities, to or by the appropriate party
so as to effect the original intent of the parties hereto. Each party shall, in
its sole discretion, either 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. Simultaneously with the execution and delivery hereof or as
promptly as practicable thereafter, (i) LSI Logic shall execute and deliver, and
shall cause its Subsidiaries to execute and deliver, such bills of sale, stock
powers, certificates of title, deed, 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 LSI
Logic's and its Subsidiaries' right, title and interest in and to the SSI Assets
to SSI and (ii) SSI shall execute and deliver to LSI Logic and its Subsidiaries
such assumptions of contracts and other instruments of assumption as and to the
extent necessary to evidence the valid and effective assumption of the SSI
Liabilities by SSI. Notwithstanding the foregoing, with respect to those SSI
Contracts for which the parties are allocating the benefits and burdens as of
the Separation but not undertaking to assign to SSI, or have SSI assume, until
the Distribution, such instructions of assignment assumption, or documentation
of assignment, will be provided in connection with the Distribution.
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 SSI Group of any
Assets intended to be SSI Assets would be a violation of applicable laws or
require any consent or Governmental Approval in connection with the Separation,
then, unless LSI Logic shall otherwise determine, the transfer, assignment or
novation to the SSI Group, as the case may be, of such Assets 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, if such Assets (or the benefits thereof) are
available for use in the SSI Business, then such Assets shall still be
considered SSI Assets for purposes of determining whether any Liability is an
SSI Liability. Further, for each SSI Contract for which such consent is not
obtained initially, the parties shall address that SSI Contract pursuant to
Section 1.8 hereof, and for other Assets, if such consents or Governmental
Approvals shall have not been obtained within two years of the Separation Date,
the parties shall 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 or Liabilities intended to be transferred
or assigned hereunder, including pursuant to the Non-US Plan, 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 or
Liabilities shall thereafter hold such Asset or Liabilities 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
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contemplated hereby and so that all the benefits and burdens relating to such
SSI Assets, 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 SSI Group. 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. With respect to SSI Contracts, if LSI
Logic retains such SSI Contracts then Section 1.8 shall apply, in addition to
Section 1.6 and Section 1.7 and the other terms of this 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.
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 that are not allocated pursuant
to the terms of the Separation Agreement, this Agreement or any other Ancillary
Agreement shall be the responsibility of the party that incurs such costs and
expenses.
1.7 Novation of Assumed SSI Liabilities.
(a) Reasonable Commercial Efforts. Each of LSI Logic and SSI 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 any assumed rights and
obligations under agreements, leases, licenses and other obligations or
Liabilities (including SSI Other Financial Liabilities) of any nature whatsoever
that constitute SSI Liabilities or to obtain in writing the unconditional
release of all parties to such arrangements other than any member of the SSI
Group, so that, in any such case, SSI and its Subsidiaries shall be solely
responsible for such Liabilities; provided, however, that neither LSI Logic, SSI
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, after using its reasonable
commercial efforts, LSI Logic or SSI is unable to obtain, or to cause to be
obtained, any such required consent, approval, release, substitution or
amendment, the applicable member of the LSI Logic 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),
SSI shall, as agent or subcontractor for LSI Logic 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 LSI Logic or such
other Person, as the case may be, thereunder from and after the date hereof. LSI
Logic shall, without further consideration, pay and remit, or cause to be paid
or remitted, to SSI 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, LSI Logic
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 SSI without payment of further consideration and SSI
shall, without the payment of any further consideration, assume such rights and
obligations.
1.8 Shared Contracts and Certain SSI Contracts. For each Shared Contract,
and for each SSI Contract for which a consent is required and not obtained, or
for which the parties have determined to delay assignment of such SSI Contract
until the Distribution, the parties shall determine a reasonable method of
providing the benefits under such Shared Contract or SSI Contract to SSI from
LSI Logic or, if applicable, to LSI Logic from SSI. Such method may include
provision of services under a schedule to the Transition Services Agreement, a
sub-license or another arrangement such as that described in Section 1.7(b), but
in any event the parties shall share in the costs or fees under such Shared
Contract or SSI Contract in proportion to the value of goods, services or IP
such party receives out of the total value of goods, services or IP provided
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under such Shared Contract or SSI Contract. To the extent LSI Logic has the
right to do so without Restriction, LSI Logic agrees to grant and hereby does
grant SSI a sub-license under such Shared Contract or SSI Contract, of the same
scope and subject to the same terms and conditions as SSI enjoys under such
Shared Contract or SSI Contract prior to the Separation Date, to the extent a
grant of such a sub-license is possible without a Restriction. Some Shared
Contracts may be Shared Contracts between the Separation Date and the
Distribution Date, but as of the Distribution Date shall become SSI Contracts;
such Shared Contracts, if any, are identified on the appropriate schedule to
this Agreement and such schedule shall be updated as necessary or appropriate.
1.9 LSI Logic Contracts. Effective on the Separation Date, SSI hereby
assigns, transfers, conveys and delivers to LSI Logic, and LSI Logic hereby
accepts from SSI all of SSI's right, title and interest, if any, in each LSI
Logic Contract. To the extent a consent or novation is required to fully
transfer and assign such LSI Logic Contract to LSI Logic, the parties shall use
their reasonable efforts to obtain such consent or novation.
ARTICLE II
MISCELLANEOUS
2.1 Limitation of Liability. IN NO EVENT SHALL ANY MEMBER OF THE LSI
LOGIC GROUP OR SSI GROUP BE LIABLE TO ANY OTHER MEMBER OF THE LSI LOGIC GROUP OR
SSI GROUP FOR ANY SPECIAL, CONSEQUENTIAL, INDIRECT, INCIDENTAL OR PUNITIVE
DAMAGES OR LOST PROFITS, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY
(INCLUDING NEGLIGENCE) ARISING IN ANY WAY OUT OF THIS AGREEMENT, WHETHER OR NOT
SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES; PROVIDED,
HOWEVER, THAT THE FOREGOING LIMITATIONS SHALL NOT LIMIT EITHER PARTY'S
INDEMNIFICATION OBLIGATIONS AS SET FORTH IN THE INDEMNIFICATION AND INSURANCE
MATTERS AGREEMENT.
2.2 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 thereof and shall supersede all prior
written and oral and all contemporaneous oral agreements and understandings with
respect to the subject matter hereof and thereof.
2.3 Governing Law. This Agreement shall be construed in accordance with,
and all Disputes hereunder shall be governed by, the laws of the State of
California, excluding its conflict of law rules, and the United Nations
Convention on Contracts for the International Sale of Goods. The Superior Court
of Santa Xxxxx County and/or the United States District Court for the Northern
District of
California 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 2.4 below.
2.4 Dispute Resolution. Any Disputes under this Agreement shall be
addressed using the same procedure set forth in the Separation Agreement.
2.5 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 at the following addresses:
if to LSI Logic: LSI Logic Corporation
0000 Xxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: General Counsel
Fax: (000) 000-0000
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if to SSI: LSI Logic Storage Systems, Inc.
0000 Xxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: General Counsel
Fax: (000) 000-0000
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.
2.6 Counterparts. This Agreement, including the exhibits and schedules
hereto, 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.
2.7 Binding Effect; Assignment. This Agreement shall inure to the benefit
of and be binding upon the parties hereto and their respective legal
representatives and successors in interest, and nothing in this Agreement,
express or implied, is intended to confer upon any other Person any rights or
remedies of any nature whatsoever under or by reason of this Agreement. This
Agreement may be enforced separately by each member of the LSI Logic Group and
each member of the SSI Group. Neither party may assign this Agreement or any
rights or obligations hereunder, without the prior written consent of the other
party, and any such assignment shall be void. Any permitted assignee shall agree
to perform the obligations of the assignor of this Agreement, and this Agreement
shall inure to the benefit of and be binding upon any permitted assignee.
2.8 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 either
party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible in an acceptable manner to the end that
transactions contemplated hereby are fulfilled to the fullest extent possible.
2.9 Failure or Indulgence Not Waiver; Remedies Cumulative. No failure or
delay on the part of either party hereto in the exercise of any right hereunder
shall impair such right or be construed to be a waiver of, or acquiescence in,
any breach of any representation, warranty or agreement herein, nor shall any
single or partial exercise or waiver of any such right preclude other or further
exercise thereof or of any other right. All rights and remedies existing under
this Agreement or the exhibits or schedules attached hereto are cumulative to,
and not exclusive of, any rights or remedies otherwise available.
2.10 Amendment. No change or amendment shall be made to this Agreement or
the exhibits or schedules attached hereto except by an instrument in writing
signed on behalf of each of the parties to such agreement.
2.11 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 exhibit or
schedule but not otherwise defined therein, shall have the meaning assigned to
such term in this Agreement. When a reference is made in this Agreement to an
article, 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.
2.12 Conflicting Agreements. Except as otherwise provided herein, in the
event of conflict between this Agreement and any other Ancillary Agreement
(excluding for this purpose the Separation Agreement) or other agreement
executed in connection herewith, the provisions of such other agreement shall
prevail.
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ARTICLE III
DEFINITIONS
3.1 Action. "Action" means any demand, action, suit, countersuit,
arbitration, inquiry, proceeding, mediation or investigation by or before any
federal, state, local, foreign or international governmental authority or any
arbitration or mediation tribunal.
3.2 Ancillary Agreement. "Ancillary Agreement" has the meaning set forth
in the Separation Agreement.
3.3 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:
(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, 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;
(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, mortgagee or holder of a Security Interest, 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 IP and licenses from third Persons granting the right to use any
IP;
(j) to the extent not included in Section 3.3(i), all computer
applications, programs and other software, including operating software, network
software, firmware, middleware, design software, design tools, systems
documentation and instructions;
(k) to the extent not included in Section 3.3(i), 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;
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(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 claims, choses in action or similar rights,
whether accrued or contingent;
(n) all rights under Insurance Policies and all rights in the nature of
insurance, indemnification or contribution;
(o) all licenses (including radio and similar 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
arrangements; and
(q) interest rate, currency, commodity or other swap, collar, cap or other
hedging or similar agreements or arrangements.
3.4 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.
3.5 Dispute. "Dispute" has the meaning set forth in the Separation
Agreement.
3.6 Distribution. "Distribution" shall mean a distribution of SSI stock
by LSI Logic to LSI Logic's shareholders in a transaction intended to qualify as
a tax-free distribution under Section 355 of the Internal Revenue Code of 1986,
as amended from time to time.
3.7 Distribution Date. "Distribution Date" means the effective date of a
Distribution.
3.8 Employee Matters Agreement. "Employee Matters Agreement" means the
Employee Matters Agreement attached as Exhibit C to the Separation Agreement.
3.9 Excluded Assets. "Excluded Assets" has the meaning set forth in
Section 1.2(b) hereof.
3.10 Excluded Liabilities. "Excluded Liabilities" has the meaning set
forth in Section 1.3(b) hereof.
3.11 Governmental Approvals. "Governmental Approvals" has the meaning set
forth in the Separation Agreement.
3.12 Governmental Authority. "Governmental Authority" has the meaning set
forth in the Separation Agreement.
3.13 Indemnification and Insurance Matters Agreement. "Indemnification
and Insurance Matters Agreement" means the Indemnification and Insurance Matters
Agreement attached as Exhibit D to the Separation Agreement.
3.14 Insurance Policies. "Insurance Policies" has the meaning set forth
in the Indemnification and Insurance Matters Agreement.
3.15 IP. "IP" has the meaning set forth in the Intellectual Property
Agreement.
3.16 Intellectual Property Agreement. "Intellectual Property Agreement"
means the Intellectual Property Agreement attached as Exhibit B to the
Separation Agreement.
3.17 LSI Logic Contracts. "LSI Logic Contracts" means those Contracts
that may be related to the SSI Business, or to which SSI may be a party, but
that are primarily related to LSI Logic's retained businesses; the material
items of which are set forth on Schedule 3.17. LSI Logic Contracts excludes any
contracts that are listed as License Agreements under the Intellectual Property
Agreement.
3.18 LSI Logic Employees. "LSI Logic Employees" has the meaning set forth
in the Employee Matters Agreement.
3.19 LSI Logic Employment Liabilities. "LSI Logic Employment Liabilities"
means all employment-related Liabilities by or regarding LSI Logic Employees and
all employment-related Liabilities by or regarding SSI Employees that arise out
of facts, acts or omissions occurring prior to the Distribution Date.
9
3.20 LSI Logic Group. "LSI Logic Group" has the meaning set forth in the
Separation Agreement.
3.21 LSI Logic Storage Business. "LSI Logic Storage Business" has the
meaning set forth in the Intellectual Property Agreement.
3.22 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.
3.23 Non-US Plan. "Non-US Plan" has the meaning set forth in the
Separation Agreement.
3.24 Other Financial Liabilities. "Other Financial Liabilities" mean all
liabilities, obligations, contingencies, instruments and other Liabilities of
any member of the LSI Logic Group 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:
(a) foreign exchange contracts;
(b) letters of credit;
(c) guarantees of third party loans to customers;
(d) surety bonds (excluding surety for workers' compensation
self-insurance);
(e) interest support agreements on third party loans to customers;
(f) performance bonds or guarantees issued by third parties;
(g) swaps or other derivatives contracts; and
(h) recourse arrangements on the sale of receivables or notes.
3.25 Person. "Person" has the meaning set forth in the Separation
Agreement.
3.26 Restriction. "Restriction" has the meaning set forth in the
Intellectual Property Agreement.
3.27 Security Interest. "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.
3.28 Separation. "Separation" has the meaning set forth in the Recitals
hereof.
3.29 Separation Agreement. "Separation Agreement" has the meaning set
forth in the Recitals hereof.
3.30 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, December 31, 2003, or such date as may be fixed by the Board of Directors
of LSI Logic.
3.31 Shared Contracts. "Shared Contracts" means those contracts between
either SSI and a third party or LSI Logic and a third party that the parties
have identified should be either allocated to LSI Logic and shared with SSI or
allocated to SSI and shared with LSI Logic, the material items of which are set
forth on Schedule 3.31 hereto, excluding any LSI Logic Contracts and excluding
any contract listed as a License Agreement under the Intellectual Property
Agreement:
(a) Contracts initially identified as SSI Contracts, but for which the
parties are unable to effect a transfer, assignment or novation pursuant to the
terms and under the conditions in this Agreement;
(b) Contracts to which LSI Logic or a Subsidiary of LSI Logic is a party as
of the Separation Date, that are used in or related to the SSI Business and also
used in or related to one of LSI Logic's businesses; and
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(c) Contracts to which SSI or a Subsidiary of SSI is a party as of the
Separation Date, that are used in or related to the LSI Logic Storage Business
or another of LSI Logic's retained businesses, and also used in or related to
the SSI Business.
3.32 SSI Assets. "SSI Assets" has the meaning set forth in Section 1.2(a)
hereof.
3.33 SSI Balance Sheet. "SSI Balance Sheet" means the audited
consolidated balance sheet (including the notes thereto) of the SSI Business as
of December 31, 2003.
3.34 SSI Business. "SSI Business" has the meaning set forth in the
Intellectual Property Agreement.
3.35 SSI Contingent Gain. "SSI Contingent Gain" means any claim or other
right, other than any matters relating to Taxes (which are governed by the Tax
Sharing Agreement), of a member of the LSI Logic Group or the SSI Group that
primarily relates to the SSI Business, whenever arising, against any Person
other than a member of the LSI Logic Group or the SSI Group, if and to the
extent that (i) such claim or right arises out of the events, acts or omissions
occurring on or prior to 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 an SSI 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 an SSI
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.
3.36 SSI Contingent Liability. "SSI Contingent Liability" means any
Liability, other than Liabilities for Taxes (which are governed by the Tax
Sharing Agreement), of a member of the LSI Logic Group or the SSI Group that
primarily relates to the SSI Business, whenever arising, to any Person other
than a member of the LSI Logic Group or the SSI Group, if and to the extent that
(i) such Liability arises out of the events, acts or omissions occurring on or
prior to the Separation Date and (ii) the existence or scope of the obligation
of a member of the LSI Logic Group or the SSI 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 such 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 an SSI 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 an SSI
Contingent Liability.
3.37 SSI Contracts. "SSI Contracts" means the following contracts and
agreements to which LSI Logic is a party or by which it or any of its Assets is
bound, whether or not in writing, the material items of which are set forth in
the attached Schedule 3.37, except for any such contract or agreement that is a
Shared
11
Contract, an LSI Logic Contract, is contemplated to be retained by LSI Logic or
any member of the LSI Logic Group pursuant to any provision of this Agreement or
any other Ancillary Agreement, or is listed as a License Agreement under the
Intellectual Property Agreement:
(a) any contract or agreement entered into in the name of, or expressly on
behalf of, any division or business unit of SSI;
(b) any contract or agreement that relates primarily to, or the Assets
obtained thereunder are used primarily in, the SSI Business;
(c) 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 SSI, including without limitation those
on the attached Schedule 3.37;
(d) any guarantee, indemnity, representation, warranty or other Liability
of any member of the SSI Group or the LSI Logic Group in respect of any other
SSI Contract, any SSI Liability or the SSI Business (including guarantees of
financing incurred by customers or other third parties in connection with
purchases of products or services from the SSI Business); and
(e) any SSI Other Financial Liability.
3.38 SSI Employees. "SSI Employees" has the meaning set forth in the
Employee Matters Agreement.
3.39 SSI Employment Liabilities. "SSI Employment Liabilities" means all
employment-related Liabilities regarding SSI Employees that arise out of facts,
acts or omissions occurring on or after the Distribution Date relating to,
arising out of, or resulting from their employment with SSI.
3.40 SSI Group. "SSI Group" has the meaning set forth in the Separation
Agreement.
3.41 SSI Liabilities. "SSI Liabilities" has the meaning set forth in
Section 1.3(a) hereof.
3.42 SSI Payables. "SSI Payables" means all accounts payable and other
obligations of payment for goods or services purchased, leased or otherwise
received in the conduct of the SSI Business that as of the Separation Date are
payable to a third Person by LSI Logic or any of LSI Logic's Subsidiaries
(including SSI), 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 LSI Logic or any of LSI Logic's Subsidiaries with respect
thereto.
3.43 SSI Receivables. "SSI Receivables" means all accounts receivable and
other rights to payment for goods or services sold, leased or otherwise provided
in the conduct of the SSI Business that as of the Separation Date are payable by
a third Person to LSI Logic or any of LSI Logic's Subsidiaries (including SSI),
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.
3.44 Subsidiary. "Subsidiary" has the meaning set forth in the Separation
Agreement.
3.45 Taxes. "Taxes" has the meaning set forth in the Tax Sharing
Agreement.
3.46 Tax Sharing Agreement. "Tax Sharing Agreement" means the Tax Sharing
Agreement attached as Exhibit E to the Separation Agreement.
3.47 Transition Services Agreement. "Transition Services Agreement" means
the Transition Services Agreement attached as Exhibit F to the Separation
Agreement.
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IN WITNESS WHEREOF, the parties have signed this
General Assignment and
Assumption Agreement effective as of the date first set forth above.
LSI LOGIC CORPORATION LSI LOGIC STORAGE SYSTEMS, INC.
By: /s/ XXXXXXX X. XXXXXXXX By: /s/ XXXXXX XXXXXXXX
--------------------------------------------- -----------------------------------------
Name: Xxxxxxx X. Xxxxxxxx Name: Xxxxxx Xxxxxxxx
Title: Chairman/C.E.O. Title: President
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