Exhibit 10.3
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FORM OF BENEFITS SHARING AGREEMENT
BETWEEN
IREX CORPORATION AND SPECIALTY PRODUCTS & INSULATION CO.
DATED AS OF _________, 1998
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TABLE OF CONTENTS
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ARTICLE I -- DEFINITIONS......................................................1
ARTICLE II - ALLOCATION OF LIABILITIES........................................5
Section 2.1 IREX's Liability............................................5
Section 2.2 SPI's Liability.............................................5
ARTICLE III - RETIREMENT PLANS................................................5
Section 3.1 Defined Benefit Plan........................................5
Section 3.2 Defined Contribution Plans..................................6
ARTICLE IV - WELFARE BENEFIT PLANS............................................8
Section 4.1 General Principles..........................................8
Section 4.2 Establishment of Mirror Welfare Plans.......................9
Section 4.3 Long Term Disability........................................9
Section 4.4 Post-retirement Medical Benefits............................9
Section 4.5 Vacation and Sick Pay Liabilities...........................9
Section 4.6 Vendor Contracts............................................9
Section 4.7 Unemployment Compensation..................................10
Section 4.8 Transfer of Certain Assets.................................10
ARTICLE V - GENERAL..........................................................10
Section 5.1 Payment of and Accounting Treatment for Expenses and
Balance Sheet Amounts......................................10
Section 5.2 Accounting Adjustments.....................................10
Section 5.3 Notices....................................................11
Section 5.4 Amendment and Waiver.......................................11
Section 5.5 Sharing of Participant Information.........................11
Section 5.6 Entire Agreement...........................................11
Section 5.7 Parties in Interest........................................11
Section 5.8 No Third-Party Beneficiaries; No Termination of Employment.12
Section 5.9 Right to Amend or Terminate Any Plans......................12
Section 5.10 Fiduciary and Related Matters..............................12
Section 5.11 Effect if Distribution Does Not Occur......................12
Section 5.12 Relationship of Parties....................................12
Section 5.13 Affiliates.................................................12
Section 5.14 Requests for Internal Revenue Service Rulings and
Determinations and United States Department of
Labor Opinions.............................................12
Section 5.15 Further Assurances and Consents............................13
Section 5.16 Severability...............................................13
Section 5.17 Governing Law..............................................13
Section 5.18 Counterparts...............................................13
Section 5.19 Disputes...................................................13
Section 5.20 Interpretation.............................................13
Section 5.21 Headings...................................................14
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BENEFITS SHARING AGREEMENT
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This is a BENEFITS SHARING AGREEMENT, dated as of June ___, 1998 (the
"Agreement"), by and between IREX Corporation, a Pennsylvania corporation
(together with its successors and permitted assigns, "IREX"), and Specialty
Products & Insulation Co., a Pennsylvania corporation (together with its
successors and permitted assigns, "SPI") (collectively, the "Parties" or
individually, a "Party").
BACKGROUND
1. The Board of Directors of IREX has determined that it is in the
best interest of IREX and the stockholders of IREX to distribute (the
"Distribution") to the holders of IREX Common Stock (as defined herein) all of
the shares of SPI Common Stock (as defined herein).
2. IREX, SPI and certain of their affiliates have entered into a
Corporate Separation Agreement, of even date herewith (the "Distribution
Agreement"), and certain other agreements that will govern certain matters
relating to the Distribution and the relationship of IREX and SPI and their
respective subsidiaries and affiliates following the Distribution.
3. This Agreement sets forth the arrangements between the Parties
relating to employee benefits and compensation matters.
THEREFORE, in consideration of the foregoing premises and the mutual
agreements and covenants contained in this Agreement, the Parties hereby agree
as follows:
ARTICLE I
DEFINITIONS
Definitions. The following words and phrases used in this Agreement
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shall have the meanings set forth below unless a different meaning is plainly
required by the context.
"Action" means any claim, demand, suit, counter suit, arbitration,
inquiry, proceeding or investigation by or before any Governmental Authority or
any arbitration or mediation tribunal, pending or threatened, known or unknown.
"ASO Contract" means an administrative services only contract, related
prior practice, or related understanding with a third-party administrator that
pertains to any IREX Welfare Plan.
"Close of the Distribution Date" means 11:59:59 P.M., Eastern Time, on
the Distribution Date.
"Code" means the Internal Revenue Code of 1986, as amended.
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"Distribution Agreement" is defined in the Background Section to this
Agreement.
"Distribution Date" means June ____, 1998.
"Employee" means any individual who maintains a common-law employee-
employer relationship with a designated Person.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"ESOP" means the IREX Corporation Employees' Stock Ownership Plan, as
amended.
"ESOP Trust" means the trust maintained pursuant to the Agreement for
Trust under the ESOP dated November 22, 1985 between IREX, X.X. Xxxxxxx and X.X.
Xxxxxxxxx, as amended.
"Former IREX Employee" means an individual who previously maintained a
common-law employee-employer relationship with IREX or a member of the IREX
Group whose employment terminated for any reason (including retirement) before
the Distribution Date and who, as of the Distribution Date, is not employed by
IREX, a member of the IREX Group or SPI.
"Former SPI Employee" means an individual who previously maintained a
common-law employee-employer relationship with SPI whose employment terminated
for any reason (including retirement) before the Distribution Date and who, as
of the Distribution Date, is not employed by SPI, IREX or a member of the IREX
Group.
"Governmental Authority" means any federal, state or local court,
government, department, commission, board, bureau, agency, official or other
regulatory, administrative or governmental authority, including, without
limitation, the United States Department of Labor, the Internal Revenue Service,
and the Pension Benefit Guaranty Corporation.
"Group Insurance Policy" means a group insurance policy issued under
any IREX Welfare Plan.
"HMO Agreements" means contracts, letter agreements, practices and
understandings with HMOs that provide medical services under the any IREX
Welfare Plans.
"HMO" means a health maintenance organization that provides benefits
under any IREX Welfare Plans.
"Immediately after the Distribution Date" means 12:00 A.M., Eastern
Time, on the day after the Distribution Date.
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"IREX Common Stock" means the shares of capital stock, par value $1.00
per share, of IREX.
"IREX Director" means a person who is a member of the Board of
Directors of IREX on the Distribution Date.
"IREX Employee" means an individual who maintains a common-law
employee-employer relationship with IREX or any member of the IREX Group on the
Distribution Date.
"IREX Flex Plan" means the IREX Corporation Flexible Reimbursement
Accounts Plan, as amended.
"IREX Group" means the Subsidiaries of IREX, excluding SPI.
"IREX Savings Plan" means the IREX Corporation Employees' Savings
Incentive Plan, as amended.
"IREX Savings Plan Trust" means the trust maintained pursuant to the
Trust Agreement dated June 30, 1992 between IREX Corporation and Vanguard
Fiduciary Trust Company, as amended.
"Liabilities" means any and all losses, claims, charges, debts,
demands, actions, costs and expenses (including, without limitation,
administrative and related costs and expenses of any Plan, program or
arrangement), of any nature whatsoever, whether absolute or contingent, matured
or unmatured, liquidated or unliquidated, accrued or unaccrued, known or
unknown, whenever arising.
"Material Feature" means any feature of a Plan that could reasonably
be expected to be of material importance to the sponsoring employer or the
participants and beneficiaries of the Plan, which could include, without
limitation, depending on the type and purpose of the particular Plan, the class
or classes of employees eligible to participate in such Plan, the nature, type,
form, source, and level of benefits provided by the employer under such Plan and
the amount or level of contributions, if any, required to be made by
participants (or their dependents or beneficiaries) to such Plan or that is a
benefit, right or feature within the meaning of Code section 411(d)(6).
"Non-Employer Stock Fund" is defined in Section 3.2(g)(ii) of this
Agreement.
"Participating Company" means any Person (other than an individual)
that is participating in a Plan sponsored by SPI, IREX or a member of the IREX
Group, as the context requires.
"Pension Plan" means the IREX Corporation Employees' Retirement Income
Plan, as amended.
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"Pension Trust" means the IREX Corporation Employees' Retirement
Income Plan Trust dated September 5, 1985 between IREX and Provident National
Bank, as amended.
"Person" means an individual, a general or limited partnership, a
corporation, a trust, a joint venture, an unincorporated organization, a limited
liability entity, any other entity, or Governmental Authority.
"Plan" means any plan, policy, program, payroll practice, on-going
arrangement, contract, trust, insurance policy or other agreement or funding
vehicle, whether written or unwritten, providing benefits to IREX Employees,
Former IREX Employees, SPI Employees or Former SPI Employees.
"Retained Employees" means all IREX Employees and Former IREX
Employees.
"SPI Common Stock" means the outstanding shares of common stock, $.01
par value, of SPI.
"SPI Director" means a person who is a member of the Board of
Directors of SPI on the Distribution Date.
"SPI Employee" means an individual who maintains a common-law
employee-employer relationship with SPI on the Distribution Date.
"SPI Hourly Plan" means the Specialty Products and Insulation Co.
Defined Contribution Pension Plan for Hourly-Paid Employees.
"SPI Savings Plan" means the savings and retirement plan established
by SPI pursuant to Section 3.2(b).
"SPI Savings Plan Trust" means the trust to be established by SPI
pursuant to Section 3.2(c).
"Subsidiary" means, with respect to any specified Person, any
corporation or other legal entity of which such Person or any of its
Subsidiaries controls or owns, directly or indirectly, more than 50% of the
stock or other equity interest entitled to vote on the election of members to
the board of directors or similar governing body.
"Transferred Employees" means all SPI Employees and Former SPI
Employees.
"Welfare Plans" when immediately preceded by "IREX," means the welfare
benefit plans, programs, and policies listed in Part 1 of Appendix A to this
Agreement that are sponsored by IREX. When immediately preceded by "SPI,"
"Welfare Plans" means the welfare benefit plans, programs, and policies listed
in Part 2 of Appendix A to this Agreement that are sponsored by SPI for periods
Immediately after the Distribution Date.
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ARTICLE II
ALLOCATION OF LIABILITIES
Section 2.1 IREX's Liability. Effective Immediately after the
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Distribution Date and thereafter, IREX shall maintain responsibility to pay,
perform, fulfill and discharge, in accordance with their respective terms, all
of the Liabilities (regardless of when or where such Liabilities arose or arise
or were or are incurred) to or relating to the Retained Employees that arise out
of or relate to the employment relationship between IREX or any member of the
IREX Group and any Retained Employee, including but not limited to any
Liabilities that arise from the termination of such employment relationship. In
addition, except as provided below, Immediately after the Distribution Date and
thereafter, IREX shall maintain responsibility for the Liabilities to or
relating to Transferred Employees specifically set forth in Sections 3.1(c),
3.2(g), 4.3 and 4.4. However, with respect to the Liabilities relating to the
IREX Savings Plan set forth in Section 3.2(g), IREX shall retain such
Liabilities only until completion of the asset transfer provided for in Section
3.2(g).
Section 2.2 SPI's Liability'. Subject to Sections 3.1(c). 4.3 and 4.4,
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Immediately after the Distribution Date (except with respect to Liabilities
under the IREX Savings Plan whereupon this Section shall be effective
immediately following the asset transfer provided for in Section 3.2(g)), SPI
shall assume responsibility to pay, perform, fulfill and discharge, in
accordance with their respective terms, all of the Liabilities (regardless of
when or where such Liabilities arose or arise or were or are incurred) to or
relating to the Transferred Employees that arise out of or relate to the
employment relationship between IREX, any member of the IREX Group or SPI and
any Transferred Employee, including but not limited to any Liabilities that
arise from the termination of such employment relationship.
ARTICLE III
Retirement Plans
Section 3.1 Defined Benefit Plan.
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(a) Cease Benefit Accruals. Effective as of May 1, 1998, IREX amended the
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Pension Plan to cease all future benefit accruals. Thereafter, no IREX Employee,
SPI Employee or any other individual shall accrue additional benefits under the
Pension Plan.
(b) Pension Contribution. Prior to the Distribution Date, IREX shall make
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a contribution to the Pension Trust on behalf of SPI in the amount of $175,000.
Within 30 days after the Distribution Date, SPI shall reimburse IREX for the
full amount of the Pension Trust contribution.
(c) Assumption of Liabilities. Effective Immediately after the
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Distribution Date and thereafter, IREX shall retain all Liabilities with respect
to the Transferred Employees under the
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Pension Plan and except as provided in Section 3.1(b), SPI shall have no further
liability with respect to the Pension Plan.
(d) PBGC Intervention. In the event that at any time the Pension Benefit
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Guaranty Corporation ("PBGC") or any other Governmental Authority asserts that
the Distribution may provide justification for the PBGC to seek termination of
the Pension Plan pursuant to ERISA section 4042 or otherwise asserts that the
transaction may increase unreasonably the long-run loss to the PBGC (within the
meaning of ERISA section 4042(a)(4)) with respect to the Pension Plan, IREX
shall negotiate in good faith with the PBGC to resolve these issues and shall
hold SPI harmless from any Liabilities related to the resolution of such issues.
Section 3.2 Defined Contribution Plans.
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(a) Plan Merger. Effective as of May 1, 1998, IREX merged the ESOP with
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and into the IREX Savings Plan.
(b) Establishment of Mirror Savings Plans. Effective Immediately after the
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Distribution Date, SPI shall adopt the SPI Savings Plan, which shall be
qualified under Code section 401(a) and shall provide benefits to Transferred
Employees that are substantially similar in all Material Features to those
provided under the IREX Savings Plan immediately before the Distribution Date.
(c) Establishment of Mirror Savings Trust. Effective Immediately after the
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Distribution Date, SPI shall establish the SPI Savings Plan Trust, which shall
hold the assets of the SPI Savings Plan and shall be exempt from taxation under
Code section 501(a).
(d) Determination Letters. SPI shall apply to the Internal Revenue Service
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("IRS") for a favorable determination letter with respect to the tax-qualified
status of the SPI Savings Plan as soon as practicable after the Distribution
Date, and SPI shall make such amendments to the SPI Savings Plan as may be
required by the IRS in order for SPI to receive a favorable determination letter
with respect to the SPI Savings Plan.
(e) Appointment of Trustee/Recordkeeper. Effective Immediately after the
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Distribution Date, SPI shall use its reasonable best efforts to enter into such
agreements to accomplish the assumption of Liabilities and transfer of assets
outlined in this Section 3.2, the maintenance of the necessary participant
records, the appointment of Vanguard Fiduciary Trust Company as initial trustee
under the SPI Savings Plan, and the engagement of Vanguard Fiduciary Trust
Company as initial recordkeeper under the SPI Savings Plan.
(f) Retention of Liabilities. Until such time as the asset transfer
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provided for in Section 3.2(g) is completed, IREX shall retain all Liabilities
with respect to the Transferred Employees under the IREX Savings Plan.
Thereafter, all such Liabilities shall be the responsibility of SPI.
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(g) Transfer of IREX Savings Plan Assets.
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(i) Transfer of Assets to the SPI Savings Plan Trust. As soon
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as practicable after the Distribution Date, IREX shall cause the accounts of the
Transferred Employees under the IREX Savings Plan that are held by the IREX
Savings Plan Trust to be transferred to the SPI Savings Plan and the SPI Savings
Plan Trust, and SPI shall cause such transferred accounts to be accepted by such
plan and trust. The transfer of such accounts shall be made: (A) in kind, to the
extent the assets consist of investments in IREX Common Stock or SPI Common
Stock and (B) otherwise in cash, interests in mutual funds, securities, or other
property or in a combination thereof, as IREX and SPI shall mutually agree, but,
to the extent practicable, shall be invested initially in comparable investment
options in the SPI Savings Plans as such accounts were invested immediately
before the date of transfer. Any outstanding loan balance to a Transferred
Employee under the IREX Savings Plan shall be transferred with the underlying
accounts.
(ii) Non-Employer Stock Funds. Effective Immediately after the
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Distribution Date, a SPI Common Stock fund shall be added as an investment
option to the IREX Savings Plan and the SPI Savings Plan shall provide for both
an IREX Common Stock fund and a SPI Common Stock fund as investment options. The
SPI Common Stock fund in the IREX Savings Plan and the IREX Common Stock fund in
the SPI Savings Plan are each referred to as a "Non-Employer Stock Fund" with
respect to the applicable Plan. The Parties intend that the appropriate Plan
fiduciaries will determine for what period of time the applicable Non-Employer
Stock Fund remains an investment option under their respective Plans.
(iii) Provision of Disclosure Materials Relating to Non-Employer
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Stock Funds. Each Party shall provide to the other Party in a timely manner such
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proxy statements, annual reports, and other materials with respect to the
Party's stock held in the Non-Employer Stock Fund under the Plan of the other
Party as may be reasonably requested by the other Party.
(iv) Governmental Filings. IREX and SPI shall make any filings
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required under the Code or ERISA in connection with the transfer described in
this Section 3.2(g) in a timely manner. The Parties agree that the transfer
described in this Section 3.2(g) shall be made in accordance with section 414(1)
of the Code.
(h) SPI Hourly Plan. Effective Immediately after the Distribution Date and
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thereafter, SPI shall retain all Liabilities with respect to the SPI Hourly Plan
and neither IREX nor any member of the IREX Group shall have any further
Liability with respect to the SPI Hourly Plan.
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ARTICLE IV
WELFARE BENEFIT PLANS
Section 4.1 General Principles.
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(a) Assumption of Liabilities. Subject to Sections 4.3 and 4.4 no later
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than Immediately after the Distribution Date, all Transferred Employees shall
cease coverage under the IREX Welfare Plans and shall commence coverage under
the SPI Welfare Plans. Notwithstanding the preceding sentence, any claims that
have been incurred prior to the date that the Transferred Employees cease
coverage under the IREX Welfare Plans shall be shared between the Parties in
accordance with their historic practice.
(b) Continuation of Elections. SPI shall cause the SPI Welfare Plans to
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recognize and maintain all coverage and contribution elections made by
Transferred Employees under the IREX Welfare Plans in effect for the period
immediately before the Distribution Date and shall apply such elections under
the SPI Welfare Plans for the remainder of the period or periods for which such
elections are by their terms applicable. SPI shall provide coverage to
Transferred Employees under the SPI Welfare Plans without the need to undergo a
physical examination or otherwise provide evidence of insurability, and will
recognize and maintain all irrevocable assignments and elections made by
Transferred Employees in connection with any life insurance coverage under the
IREX Welfare Plans and any predecessor plans.
(c) Continuation of Co-Payments. SPI shall cause the SPI Welfare Plans to
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recognize and give credit for all amounts applied to deductibles, out-of-pocket
maximums, and other applicable benefit coverage limits for expenses that have
been incurred by Transferred Employees under the IREX Welfare Plans for the
remainder of the benefit limit year in which the Distribution Date occurs.
(d) Continuation of Maximum Benefits. SPI shall cause the SPI Welfare
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Plans to recognize and give credit for all benefits paid to Transferred
Employees under the IREX Welfare Plans, before and during the benefit limit year
in which the Distribution occurs, for purposes of determining when such persons
have reached their lifetime maximum benefits under the SPI Welfare Plans.
(e) COBRA and HIPAA Obligations. For periods before the Distribution Date,
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IREX shall be responsible for administering compliance with the continuation
coverage requirements for "group health plans" under Title X of the Consolidated
Omnibus Budget Reconciliation Act of 1985, as amended ("COBRA"), and the
portability requirements under the Health Insurance Portability and
Accountability Act of 1996 ("HIPAA"), with respect to Transferred Employees and
their beneficiaries and dependents. Effective Immediately after the Distribution
Date and thereafter, Transferred Employees and their beneficiaries and
dependents who have incurred a "qualifying event" (as defined in Code section
4980B) on or prior to the Distribution Date shall be entitled to COBRA coverage
under the SPI Welfare Plans and SPI shall be solely responsible for
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administering compliance with such COBRA and HIPAA requirements with respect to
these persons.
(f) Subrogation. If either IREX or SPI recovers any amounts through
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subrogation or otherwise for claims reimbursed to Transferred Employees and
their beneficiaries and dependents under any IREX Welfare Plan, the recovering
Party shall share with the other Party a portion of such recovery in accordance
with their historic practice.
Section 4.2 Establishment of Mirror Welfare Plans. Except as otherwise
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set forth in this Article IV, SPI shall take all actions necessary or
appropriate to establish, on or before the Distribution Date, SPI Welfare Plans
to provide each Transferred Employee with benefits substantially similar in all
Material Features to the benefits provided to him or her under the IREX Welfare
Plans immediately before the Distribution.
Section 4.3 Long Term Disability. Notwithstanding any provision in this
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Agreement to the contrary, responsibility for the long-term disability benefits
of any Former SPI Employee who is receiving such benefits on the Distribution
Date shall continue to be provided under the appropriate IREX Welfare Plan and
shall remain the sole responsibility of IREX.
Section 4.4 Post-retirement Medical Benefits. Notwithstanding any
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provision in this Agreement to the contrary, responsibility for the post-
retirement medical benefits of any Former SPI Employee who is receiving such
benefits on the Distribution Date shall continue to be provided under the
appropriate IREX Welfare Plan and shall remain the sole responsibility of IREX.
Section 4.5 Vacation and Sick Pay Liabilities. Effective Immediately
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after the Distribution Date, SPI shall assume all accrued Liabilities for
vacation and sick leave in respect of all Transferred Employees as of the
Distribution Date.
Section 4.6 Vendor Contracts.
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(a) Pre-Distribution Date Negotiation. Before the Distribution Date, IREX
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shall take such steps as are necessary under each ASO Contract, Group Insurance
Policy and HMO Agreement in existence as of the date of this Agreement to permit
SPI to participate in the terms and conditions of such ASO Contract, Group
Insurance Policy or HMO Agreement beginning Immediately after the Distribution
Date.
(b) Terms of SPI Participation. IREX shall determine, and shall promptly
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notify SPI of, the manner in which SPI's participation in the terms and
conditions of any ASO Contracts, Group Insurance Policies and HMO Agreements, as
set forth above is to be effectuated. SPI hereby authorizes IREX to act on its
behalf to extend to SPI the terms and conditions of the ASO Contracts, Group
Insurance Policies and HMO Agreements. SPI shall fully cooperate with IREX in
such efforts.
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(c) Premium/Administration Rates. IREX and SPI shall use their reasonable
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best efforts to cause each of the insurance companies, HMOs, paid provider
organizations and third-party administrators providing services and benefits
under the IREX Welfare Plans to maintain the premium and/or administrative
rates, based on the aggregate number of participants in both the IREX Welfare
Plans, and the SPI Welfare Plans after the Distribution Date.
(d) Management of the Vendor Contracts. Immediately after the Distribution
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Date, SPI shall be responsible for the management and control of the ASO
Contracts, Group Insurance Policies, HMO Agreements, and other vendor contracts
and relationships to the extent such contracts, policies and agreements apply to
the SPI Welfare Plans. Notwithstanding the foregoing, nothing contained in this
Section 4.6(d) shall permit SPI to direct any insurance carrier, third-party
vendor or claims administrator with respect to any contractual arrangement,
policy or agreement under any IREX Welfare Plan.
Section 4.7 Unemployment Compensation. Effective Immediately after the
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Distribution Date, SPI shall assume all Liabilities for Transferred Employees
related to any and all unemployment compensation matters under any law of any
state, territory, or possession of the U.S. or the District of Columbia and SPI
shall be fully responsible for the administration of all such claims. If SPI is
unable to assume any such Liability or the administration of any such claim
because of the operation of applicable state law or for any other reason, SPI
shall reimburse IREX for all such Liabilities.
Section 4.8 Transfer of Certain Assets. Following the Distribution Date,
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IREX and SPI periodically shall determine the amount of claims made by any
Transferred Employee under the IREX Flex Plan that exceed such Transferred
Employee's actual contributions to the IREX Flex Plan. Thereafter, to the extent
that a Transferred Employee's claims exceed such Transferred Employee's actual
contributions SPI shall make a cash payment of such amount to IREX.
ARTICLE V
GENERAL
Section 5.1 Payment of and Accounting Treatment for Expenses and Balance
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Sheet Amounts.
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(a) Balance Sheet Amounts. Effective Immediately after the Distribution
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Date, SPI shall assume any balance sheet liability for any Liabilities assumed
by it under this Agreement with respect to any Transferred Employee. The
determination of any balance sheet liability to be assumed by SPI under this
Section 6.1(b) shall be determined by IREX consistent with past accounting
practices, consistently applied.
Section 5.2 Accounting Adjustments. Prior to the Distribution Date, SPI
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has established on its books for financial accounting purposes liabilities and
reserves for retirement, welfare and other employee benefit plan obligations
that will be retained or assumed by SPI under
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this Agreement, and IREX has adjusted the liabilities and reserves on its
books for financial accounting purposes to take into account SPI' assumption or
retention of liabilities under this Agreement. Such adjustments have been made
on an estimated basis. After the Parties have finally calculated the actual
liabilities under this Agreement, each Party in accordance with their historic
practices shall appropriately adjust its liabilities and reserves to reflect the
amount of the liabilities and reserves that are properly allocable to that
Party. Neither Party shall have any obligation to make payments or transfer
assets to the other Party with respect to such adjustments.
Section 5.3 Notices. Any notice, demand, claim, or other communication
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under this Agreement shall be in writing and shall be given in accordance with
the provision for giving notice under the Distribution Agreement.
Section 5.4 Amendment and Waiver. This Agreement may not be altered or
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amended, nor may rights hereunder be waived, except by an instrument in writing
executed by the Party or Parties to be charged with such amendment or waiver.
No waiver of any terms, provision or condition of or failure to exercise or
delay in exercising any rights or remedies under this Agreement, in any one or
more instances, shall be deemed to be, or construed as, a further or continuing
waiver of any such term, provision, condition, right or remedy or as a waiver of
any other term, provision or condition of this Agreement.
Section 5.5 Sharing of Participant Information. IREX and SPI shall share
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with each other and their respective agents and vendors (without obtaining
releases) all participant information necessary for the efficient and accurate
administration of each of their respective Plans. IREX and SPI and their
respective authorized agents shall, subject to applicable laws on
confidentiality, be given reasonable and timely access to, and may make copies
of, all information relating to the subjects of this Agreement in the custody of
the other Party, to the extent necessary for such administration.
Section 5.6 Entire Agreement. This Agreement, together with the
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Distribution Agreement and the all other agreements between the Parties hereto
referred to therein (the "Ancillary Agreements"), constitute the entire
understanding of the Parties hereto with respect to the subject matter hereof,
superseding all negotiations, prior discussions and prior agreements and
understandings relating to such subject matter. To the extent that the
provisions of this Agreement are inconsistent with the provisions of the
Distribution Agreement or any Ancillary Agreement, the provisions of this
Agreement shall prevail.
Section 5.7 Parties in Interest. Neither of the Parties hereto may
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assign its rights or delegate any of its duties under this Agreement without the
prior written consent of each other Party (which consent shall not be
unreasonably withheld or delayed). This Agreement shall be binding upon, and
shall inure to the benefit of, the Parties hereto and their respective
successors and permitted assigns.
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Section 5.8 No Third-Party Beneficiaries; No Termination of Employment.
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No provision of this Agreement or the Distribution Agreement shall be construed
to create any right, or accelerate entitlement, to any compensation or benefit
whatsoever on the part of any Transferred Employee or other future, present, or
former employee of IREX, the IREX Group or SPI. Without limiting the generality
of the foregoing, neither the Distribution nor the termination of the
Participating Company status of SPI shall cause any employee to be deemed to
have incurred a termination of employment which entitles such individual to the
commencement of benefits under any of the IREX Plans.
Section 5.9 Right to Amend or Terminate Any Plans. Nothing in this
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Agreement other than those provisions specifically set forth herein to the
contrary shall preclude SPI, at any time after the Close of the Distribution
Date, from amending, merging, modifying, terminating, eliminating, reducing, or
otherwise altering in any respect any SPI Plan.
Section 5.10 Fiduciary and Related Matters. SPI acknowledges that
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Immediately after the Distribution Date IREX will not be a fiduciary with
respect to any SPI Plans. In addition, IREX acknowledges that Immediately after
the Distribution Date SPI will not be a fiduciary with respect to any IREX
Plans. The Parties each acknowledge that the other Party shall not be deemed to
be in violation of this Agreement if it fails to comply with any provisions
hereof based upon its good faith reasonable determination that to do so would
violate any applicable fiduciary duties or standards of conduct under ERISA or
other applicable law.
Section 5.11 Effect if Distribution Does Not Occur. If the Distribution
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does not occur, then all actions and events that are, under this Agreement, to
be taken or occur effective as of the Close of the Distribution Date,
Immediately after the Distribution Date, or otherwise in connection with the
Distribution, shall not be taken or occur except to the extent specifically
agreed to in writing by SPI and IREX.
Section 5.12 Relationship of Parties. Nothing in this Agreement shall be
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deemed or construed by the Parties or any third party as creating the
relationship of principal and agent, partnership or joint venture between the
Parties, it being understood and agreed that no provision contained herein, and
no act of the Parties, shall be deemed to create any relationship between the
Parties other than the relationship set forth herein.
Section 5.13 Affiliates. Each of IREX and SPI shall cause to be
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performed, and hereby guarantees the performance of, all actions, agreements and
obligations set forth in this Agreement to be performed by their respective
affiliates, other than the other Party.
Section 5.14 Requests for Internal Revenue Service Rulings and
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Determinations and United States Department of Labor Opinions. SPI shall
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cooperate fully with IREX on any issue relating to the transactions contemplated
by this Agreement for which IREX elects to seek a determination letter or
private letter ruling from the Internal Revenue Service or an advisory opinion
from the United States Department of Labor. IREX shall cooperate fully with SPI
with respect to any request for a determination letter or private letter ruling
from the Internal
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Revenue Service or advisory opinion from the United States Department of Labor
with respect to any of the SPI Plans relating to the transactions contemplated
by this Agreement.
Section 5.15 Further Assurances and Consents. In addition to the actions
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specifically provided for elsewhere in this Agreement, each of the Parties
hereto will use its reasonable efforts to (a) execute and deliver such further
instruments and documents and take such other actions as any other Party may
reasonably request in order to effectuate the purposes of this Agreement and to
carry out the terms hereof and (b) take, or cause to be taken, all actions, and
to do, or cause to be done, all things, reasonably necessary, proper or
advisable under applicable laws, regulations and agreements or otherwise to
consummate and make effective the transactions contemplated by this Agreement,
including, without limitation, using its reasonable efforts to obtain any
consents and approvals and to make any filings and applications necessary or
desirable in order to consummate the transactions contemplated by this
Agreement; provided that no Party hereto shall be obligated to pay any
consideration therefor (except for filing fees and other similar charges) to any
third Party from whom such consents, approvals and amendments are requested or
to take any action or omit to take any action if the taking of or the omission
to take such action would be unreasonably burdensome to the Party.
Section 5.16 Severability. The provisions of this Agreement are severable
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and should any provision hereof be void, voidable or unenforceable under any
applicable law, such provision shall not affect or invalidate any other
provision of this Agreement, which shall continue to govern the relative rights
and duties of the Parties as though such void, voidable or unenforceable
provision were not part hereof.
Section 5.17 Governing Law. Subject to U.S. federal law, this Agreement
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shall be construed in accordance with, and governed by, the laws of the
Commonwealth of Pennsylvania, without regard to the conflicts of law rules of
such state.
Section 5.18 Counterparts. This Agreement may be executed in one or more
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counterparts each of which shall be deemed an original instrument, but all of
which together shall constitute but one and the same Agreement.
Section 5.19 Disputes. Resolution of any and all disputes arising from or
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in connection with this Agreement, whether based on contract, tort, statute or
otherwise, including, without limitation, disputes in connection with claims by
third Parties shall be exclusively governed by and settled in accordance with
provisions identical to those set forth in Section 21 of the Distribution
Agreement, which Section is hereby incorporated by this reference.
Section 5.20 Interpretation. Words in the singular shall be held to
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include the plural and vice versa and words of one gender shall be held to
include the other gender as the context requires. The terms "hereof," "herein,"
and "herewith" and words of similar import shall, unless otherwise stated, be
construed to refer to this Agreement as a whole (including all Appendices
hereto) and not to any particular provision of this Agreement. The word
"including" and words of similar import when used in this Agreement shall mean
"including, without limitation," unless
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the context otherwise requires or unless otherwise specified. The word "or"
shall not be exclusive. References to any "Article," "Schedule" or "Section,"
without more, are to Articles, Schedules and Sections to or of this Agreement.
Section 5.21 Headings. The Article and Section headings contained in this
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Agreement are solely for the purpose of reference, are not part of the agreement
of the Parties hereto and shall not in any way affect the meaning or
interpretation of this Agreement.
IN WITNESS WHEREOF, the Parties hereto have executed and delivered
this Agreement as of the day and year first above written.
IREX CORPORATION
By:
-------------------------------
Name:
Title:
SPECIALTY PRODUCTS AND INSULATION
CO.
By:
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Name:
Title:
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APPENDIX A - WELFARE BENEFIT PLANS
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I. PART 1 - IREX WELFARE PLANS
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Healthcare Coverage (medical and dental)
Basic Life Insurance
Supplemental Life Insurance
Basic Long Term Disability Insurance
Additional Long Term Disability Coverage
Voluntary Accidental Death and Dismemberment (AD&D) Insurance
Business Travel Insurance
Benefit Options Program
Flexible Reimbursement Account for Healthcare Expenses
Flexible Reimbursement Account for Dependent Care Expenses
Sick Leave
Paid Time Off
Vacation
II. PART 2 - SPI WELFARE PLANS
--------------------------
Healthcare Coverage (medical and dental)
Basic Life Insurance
Supplemental Life Insurance
Basic Long Term Disability Insurance
Additional Long Term Disability Coverage
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Voluntary Accidental Death and Dismemberment (AD&D) Insurance
Business Travel Insurance
Benefit Options Program
Flexible Reimbursement Account for Healthcare Expenses
Flexible Reimbursement Account for Dependent Care Expenses
Sick Leave
Paid Time Off
Vacation
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