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Exhibit 10.14
MASTER SEPARATION AGREEMENT
This MASTER SEPARATION AGREEMENT (this "Agreement") is made and entered
into as of May 28, 2000 by and between Methode Electronics, Inc., a Delaware
corporation ("Methode") and Stratos Lightwave, Inc., a Delaware corporation
("Stratos"). Capitalized terms used and not otherwise defined herein are defined
in Article 1 of this Agreement.
RECITALS:
WHEREAS, Methode's Board of Directors has determined that it would be
in the best interests of Methode and its stockholders to completely separate the
Opto Business from Methode;
WHEREAS, Methode has caused Stratos to be incorporated in order to
effect such separation and Methode currently owns all of the issued and
outstanding common stock of Stratos;
WHEREAS, the Boards of Directors of Methode and Stratos have each
determined that it would be appropriate and desirable for Methode to contribute
and transfer to Stratos, and for Stratos to receive and assume, directly or
indirectly, all of the capital stock and equity interests currently held by
Methode in subsidiaries and other entities that conduct the Opto Business, and
all other assets and liabilities currently associated with such business, in
exchange for shares of Stratos Common Stock;
WHEREAS, Methode and Stratos intend, for U.S. federal income tax
purposes, that such contribution of assets and assumption of liabilities will
qualify either as a tax-free reorganization under Section 368(a)(1)(D) of the
Code or will be a tax-free transfer of assets under Section 351(a) of the Code;
WHEREAS, Methode and Stratos currently contemplate that, following such
contribution and transfer, Stratos will make an initial public offering of an
amount of Stratos' Common Stock that will reduce Methode's ownership of Stratos,
but not below 80%;
WHEREAS, Methode currently contemplates that, following such initial
public offering, Methode will distribute to the holders of its stock by means of
a pro rata distribution all of the shares of Stratos Common Stock owned by
Methode (the "Distribution");
WHEREAS, Methode and Stratos intend, for U.S. federal income tax
purposes, that the Distribution will be tax-free to Methode and its stockholders
(other than with respect to cash received in lieu of fractional shares) under
Sections 355 and 361 of the Code; and
WHEREAS, the parties intend in this Agreement to set forth the
arrangements between them regarding the separation of the Opto Business.
NOW, THEREFORE, in consideration of the foregoing, and the mutual
covenants and agreements set forth below, the parties hereto agree as follows:
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ARTICLE 1
DEFINITIONS
For purposes of this Agreement, the following terms shall have the
meanings ascribed to them below:
"AFFILIATE" of a Person means any Person Controlling, Controlled by, or
under common Control with that Person; PROVIDED, HOWEVER, that for purposes of
this Agreement (i) Methode and its Subsidiaries (other than Stratos and its
Subsidiaries) shall not be considered Affiliates of Stratos, and (ii) Stratos
and its Subsidiaries shall not be considered Affiliates of Methode.
"ANCILLARY AGREEMENTS" means the Assignment Agreement, the IPO and
Distribution Agreement, the Tax Sharing Agreement, the Master Transitional
Services Agreement, the Employee Matters Agreement, and the Registration Rights
Agreement.
"ASSIGNMENT AGREEMENT" means the General Assignment and Assumption
Agreement dated as of May 27, 2000, by and between Methode and Stratos
Lightwave, LLC, a Delaware limited liability company.
"ASSUMED LIABILITIES" has the meaning set forth in the Assignment
Agreement.
"BUSINESS DAY" means a day other than a Saturday, a Sunday or a day on
which banking institutions located in the State of Illinois are authorized or
obligated by law or executive order to close.
"CODE" means the Internal Revenue Code of 1986, as amended from time to
time, together with the rules and regulations promulgated thereunder.
"CONTRIBUTION DATE" means May 28, 2000, effective as of 12:01 a.m.,
Central Daylight Savings Time.
"CONTROL" means the possession, direct or indirect, of the power to
direct or cause the direction of the management or the policies of a Person,
whether through the ownership of voting securities, by contract or otherwise.
"Controlling" and "Controlled" have the corollary meanings ascribed thereto.
"DISPUTES" has the meaning set forth in Section 10.1.
"DISTRIBUTION" has the meaning set forth in the recitals to this
Agreement.
"DISTRIBUTION DATE" means the date to be determined by Methode in its
sole and absolute discretion when the Distribution is completed.
"EFFECTIVE DATE" has the meaning set forth in the Assignment Agreement.
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"EMPLOYEE MATTERS AGREEMENT" means the Employee Matters Agreement dated
as of May 28, 2000, by and between Methode and Stratos.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"EXCLUDED ASSETS" has the meaning set forth in the Assignment
Agreement.
"EXCLUDED LIABILITIES" has the meaning set forth in the Assignment
Agreement.
"GOVERNMENT AUTHORITY means any federal, state, local, foreign or
international court, government, department, commission, board, bureau, agency,
official or other regulatory, administrative or governmental authority.
"INFORMATION" means all books and records, files, contracts,
instruments, computer and other data and other similar information.
"INDEMNIFYING PARTY" has the meaning set forth in Section 5.2(a).
"INDEMNITEE" has the meaning set forth in Section 5.2(a).
"INSURANCE TRANSITION PERIOD" has the meaning set forth in Section
8.1(a).
"IPO AND DISTRIBUTION AGREEMENT" means the Initial Public Offering and
Distribution Agreement to be entered into between Methode and Stratos on or
before the IPO Effective Date.
"IPO EFFECTIVE DATE" means the date on which the IPO Registration
Statement is declared effective by the SEC.
"IPO REGISTRATION STATEMENT" means the registration statement on Form
S-1, Registration No. 333-34864, filed by Stratos with the SEC in connection
with the initial public offering of Stratos Common Stock, as it may be amended.
"LIABILITIES" means all debts, liabilities, guarantees, assurances,
commitments and obligations whatsoever, whether fixed, contingent or absolute,
asserted or unasserted, matured or unmatured, liquidated or unliquidated,
accrued or not accrued, known or unknown, whether at law or in equity (including
any right of contribution), and whether arising under any contract or agreement,
by operation of law or otherwise.
"LOCAL COUNSEL" has the meaning set forth in Section 5.2(b).
"METHODE INDEMNITEES" has the meaning set forth in Section 5.1(a).
"MASTER TRANSITIONAL SERVICES AGREEMENT" means the Master Transitional
Services Agreement dated as of May 28, 2000, by and between Methode and Stratos.
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"OPTO ASSETS" has the meaning set forth in the Assignment Agreement.
"OPTO BUSINESS" means the optical subsystems and components businesses
conducted by Methode and/or the Opto Subsidiaries at any time on or before the
Contribution Date, either directly or indirectly, including, without limitation,
(i) all business operations whose financial performance is reflected in the
Stratos Financial Statements, and (ii) all business operations relating to such
businesses initiated or acquired by Methode after the date of the Stratos
Financial Statements.
"OPTO SUBSIDIARIES" means (i) Bandwidth Semiconductor, LLC, a Delaware
limited liability company; (ii) Methode Communication Modules, Inc., a Delaware
corporation; (iii) MP Optical Communications, LLC, an Illinois limited liability
company; (iv) Stratos, Limited, a corporation organized under the laws of the
United Kingdom; and (v) Stratos Lightwave, LLC, a Delaware limited liability
company.
"PERSON" means an individual, partnership, limited liability company,
joint venture, corporation, trust, unincorporated association, any other entity,
or any government or any department or agency or other unit thereof.
"POSSESSOR" has the meaning set forth in Section 6.1.
"PRIMARY COUNSEL" has the meaning set forth in Section 5.2(b).
"PRIOR RELATIONSHIP" means the ownership relationship between Methode
and Stratos at any time prior to the Contribution Date.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights Agreement
to be entered into between Methode and Stratos on or before the IPO Effective
Date.
"RELATED PARTIES" has the meaning set forth in Section 6.1.
"REPRESENTATIVES" means directors, officers, employees, agents,
consultants, advisors, accountants, attorneys and representatives.
"REQUESTOR" has the meaning set forth in Section 6.1.
"RETAINED DISREGARDED ENTITY" means any entity that (i) is disregarded
as an entity separate from its owner for U.S. federal income tax purposes, (ii)
the interests in which are owned by Methode, and (iii) the interests in which
will not be transferred to Stratos pursuant to this Agreement.
"RETENTION PERIOD" has the meaning set forth in Section 6.2(a).
"SEC" means the Securities and Exchange Commission.
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"SEPARATE COUNSEL" has the meaning set forth in Section 5.2(b).
"SPECIAL PATENT COUNSEL" has the meaning set forth in Section 5.2(b).
"STRATOS COMMON STOCK" means the common stock, $.01 par value per
share, of Stratos.
"STRATOS COVERED PARTIES" has the meaning set forth in Section 8.1(a).
"STRATOS FINANCIAL STATEMENTS" means the financial statements
(including the related notes) of Stratos for the period ended April 30, 2000, as
set forth in the IPO Registration Statement.
"STRATOS INDEMNITEES" has the meaning set forth in Section 5.1(b).
"STRATOS LIGHTWAVE LLC" means Stratos Lightwave, LLC, a Delaware
limited liability company.
"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 fifty percent
(50%) of the stock or other equity interest entitled to vote with respect to the
election of members to the board of directors or similar governing body;
PROVIDED, HOWEVER, that for the purposes of this Agreement, neither Stratos nor
any of the Subsidiaries of Stratos shall be deemed to be Subsidiaries of Methode
or of any of the Subsidiaries of Methode.
"TAX" or "TAXES" have the meaning set forth in the Tax Sharing
Agreement.
"TAX SHARING AGREEMENT" means the Tax Sharing and Indemnification
Agreement to be entered into by and between Methode and Stratos on or before the
IPO Effective Date.
"THIRD-PARTY CLAIM" means any claim, suit, arbitration, inquiry,
proceeding or investigation by or before any court, governmental or other
regulatory or administrative agency or commission, or any arbitration tribunal
asserted by a Person other than the parties hereto or their respective
Affiliates that gives rise to a right of indemnification hereunder.
"TRANSFERRED DISREGARDED ENTITY" means any entity that (i) is
disregarded as an entity separate from its owner for U.S. federal income tax
purposes, (ii) all of the interests in which are owned by Methode, and (iii) all
of the interests in which will be transferred to Stratos pursuant to this
Agreement.
"TREASURY REGULATIONS" means the regulations promulgated under the
Code, and any successor provisions thereof, as in effect for the relevant
taxable period.
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ARTICLE 2
SEPARATION
2.1. SEPARATION OF OPTO BUSINESS.
(a) CONTRIBUTION AND TRANSFER OF OPTO SUBSIDIARIES. As of the
Contribution Date, Methode hereby contributes and transfers to Stratos, in
exchange for 54,028,807 shares of Stratos Common Stock, all of its right, title
and interest in and to the following:
(i) 100% of the membership interests in Bandwidth
Semiconductor, LLC, a Delaware limited liability company;
(ii) 100% of the issued and outstanding capital stock of Methode
Communication Modules, Inc., a Delaware corporation;
(iii) its sixty percent (60%) membership interest in MP Optical
Communications LLC, an Illinois limited liability company;
and
(iv) 100% of the issued and outstanding capital stock of Stratos
Limited, a corporation organized under the laws of the
United Kingdom; and
(v) 100% of the membership interests in Stratos Lightwave, LLC.
(b) CONTRIBUTION AND TRANSFER OF OTHER OPTO ASSETS. As of the
Contribution Date, Methode hereby contributes and transfers to Stratos all of
its right, title and interest in and to all other assets owned by Methode or its
Subsidiaries which are used primarily in, relate primarily to, or arise directly
from the Opto Business, other than the Excluded Assets.
(c) TREATMENT OF CERTAIN LIABILITIES.
(i) Prior to the Contribution Date, Methode shall cancel, or
cause to be cancelled, any intercompany account owing from any Transferred
Disregarded Entity to Methode or to any Retained Disregarded Entity. As a result
of such cancellation, Stratos shall not assume pursuant to the transactions
contemplated hereunder any liability for any intercompany account of the type
described in the immediately preceding sentence. In addition, prior to the
Contribution Date, each Transferred Disregarded Entity shall cancel, or cause to
be cancelled, any intercompany account owing from Methode or any Retained
Disregarded Entity to such Transferred Disregarded Entity.
(ii) Any liabilities reflected on the books and records of
Methode between Methode and any unincorporated branch or division of Methode or
between two unincorporated branches or divisions of Methode shall not be treated
as liabilities. No new or additional liabilities of the type described in the
immediately preceding sentence will be created or reflected on the books and
records of Methode during any period (or portion thereof) beginning on or after
the Effective Date and ending on or before the execution of this Agreement.
Accordingly,
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Stratos shall not assume pursuant to the transactions contemplated hereunder any
liability of the type described in the first sentence of this section
2.1(c)(ii).
(d) INSTRUMENTS OF CONVEYANCE AND TRANSFER. As of the Contribution
Date, Methode shall deliver or cause to be delivered to Stratos such stock
certificates (accompanied by duly executed assignment documents), assignments,
bills of sale, deeds, and other good and sufficient instruments of conveyance,
all in recordable form, where applicable, as are required under local custom and
practice to vest in Stratos all right, title and interest of Methode in and to
the capital stock and equity interests and other assets described in Section
2.1(a) and (b) above.
2.2 FURTHER ASSURANCES. From time to time after the Contribution Date,
Methode and any Methode Affiliate shall execute, acknowledge and deliver, or
cause to be executed, acknowledged and delivered, such other instruments of
conveyance, assignment, transfer and delivery and will take or cause to be taken
such other actions as Stratos may reasonably request in order more effectively
to assign, convey, transfer, and deliver to Stratos the capital stock and equity
interests and other assets described in Section 2.1(a) and (b) above, or to
enable Stratos to protect, exercise and enjoy all of Methode's rights and
benefits with respect thereto, and as otherwise may be appropriate to carry out
the transactions contemplated hereby.
2.3. TRANSFER COSTS. Stratos shall bear all of the costs of the
transfer of the capital stock and equity interests and other assets described in
Section 2.1(a) and (b) above from Methode to Stratos.
ARTICLE 3
ANCILLARY AGREEMENTS
3.1 GENERAL. Methode and Stratos acknowledge and agree that the
Ancillary Agreements have been or will be entered into prior to the IPO
Effective Date. Methode and Stratos shall take all steps reasonably necessary to
cause their respective Subsidiaries and Affiliates to enter into and perform
such Ancillary Agreements in accordance with their terms.
3.2 PRIORITY. To the extent that any Ancillary Agreement conflicts
with the terms of this Agreement, including, without limitation, matters
covered by Article 2, Article 5 and Article 6 (solely with respect to matters
relating to Taxes) hereof, the terms and conditions of such Ancillary
Agreement shall govern the rights and obligations of the parties with respect
to such matters. Without limiting the foregoing, the rights and obligations
of the parties with respect to the payment of Taxes and related matters shall
be governed by the relevant terms and provisions of the Tax Sharing Agreement.
ARTICLE 4
COVENANTS
4.1. IPO AND DISTRIBUTION AGREEMENT. Methode and Stratos hereby agree
to execute and deliver, on or before the IPO Effective Date, the IPO and
Distribution Agreement, in
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substantially the form agreed upon between the parties on or prior to the date
hereof, with such modifications to such form as the parties shall mutually deem
reasonably necessary and desirable.
4.2. REGISTRATION RIGHTS AGREEMENT. Methode and Stratos hereby agree to
execute and deliver, on or before the IPO Effective Date, the Registration
Rights Agreement, in substantially the form agreed upon between the parties on
or prior to the date hereof, with such modifications to such form as the parties
shall mutually deem reasonably necessary and desirable.
4.3. NO TAX ELECTION. None of Methode or any of its Affiliates
(including, without limitation, prior to the transactions contemplated hereby,
Stratos Lightwave LLC), Stratos or any of its Affiliates (including, without
limitation, subsequent to the transactions contemplated hereby, Stratos
Lightwave, LLC) or any of their respective Representatives shall make any
election under Treasury Regulations promulgated under Section 7701 of the Code
(or any successor regulation or provision), or otherwise take any action, or
fail to take any action, that could cause Stratos Lightwave LLC not to be
disregarded as an entity separate from its owner for U.S. federal income tax
purposes.
ARTICLE 5
INDEMNIFICATION
5.1. INDEMNIFICATION.
(a) Stratos shall indemnify, defend and hold harmless Methode and each
of its Subsidiaries, and each of their respective past and present
Representatives (the "Methode Indemnitees") against any and all actions, claims,
damages, losses, or liabilities, resulting from, relating to or arising, whether
prior to or following the Contribution Date, out of or in connection with: (i)
the Assumed Liabilities, and/or (ii) the operation of the Opto Business, and
Stratos shall reimburse each Methode Indemnitee for any and all reasonable costs
and expenses (including attorneys' fees) incurred by any of them in connection
with investigating and/or defending any such action, claim, damage, loss, or
liability, other than legal fees incurred prior to the Contribution Date.
(b) Methode (the "Methode Indemnifying Party") shall indemnify, defend
and hold harmless Stratos and each of its Subsidiaries, and each of their past
and present Representatives (the "Stratos Indemnitees") against any and all
actions, claims, damages, losses, or liabilities resulting from, relating to or
arising, whether prior to or following the Contribution Date, out of or in
connection with: (i) the Excluded Assets and/or (ii) the Excluded Liabilities,
and Methode shall reimburse each Stratos indemnitee for any and all reasonable
costs and expenses (including attorneys' fees) incurred by any of them in
connection with investigating and/or defending any such action, claim, damage,
loss or liability, other than legal fees incurred prior to the Contribution
Date.
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5.2. INDEMNIFICATION PROCEDURES.
(a) If a Methode Indemnitee or Stratos Indemnitee (collectively, an
"Indemnitee") receives notice of the assertion of any Third-Party Claim with
respect to which a Stratos Indemnifying Party or Methode Indemnifying Party,
respectively (collectively, an "Indemnifying Party") is, or is likely to be,
obligated under this Agreement to provide indemnification, such Indemnitee shall
promptly give such Indemnifying Party notice thereof (together with a copy of
such Third-Party Claim, process or other legal pleading) promptly after becoming
aware of such Third-Party Claim; PROVIDED, HOWEVER, that the failure of any
Indemnitee to give notice as provided in this Section 5.2 shall not relieve any
Indemnifying Party of its obligations under this Section 5.2, except to the
extent that such Indemnifying Party is actually prejudiced by such failure to
give notice. Such notice shall describe such Third-Party Claim in reasonable
detail.
(b) An Indemnifying Party, at such Indemnifying Party's own expense
and through counsel chosen by such Indemnifying Party (which counsel shall be
reasonably acceptable to the Indemnitee), may elect to defend any Third-Party
Claim. If an Indemnifying Party elects to defend a Third-Party Claim in
accordance with the foregoing, then, within ten (10) Business Days after
receiving notice of such Third-Party Claim (or sooner, if the nature of such
Third Party claim so requires), such Indemnifying Party shall notify the
Indemnitee of its intent to do so, and such Indemnitee shall cooperate in the
defense of such Third-Party Claim. Such Indemnifying Party shall pay such
Indemnitee's reasonable out-of-pocket expenses incurred in connection with
such cooperation. Such Indemnifying Party shall keep the Indemnitee
reasonably informed as to the status of the defense of such Third-Party
Claim. After notice from an Indemnifying Party to an Indemnitee of its
election to assume the defense of a Third-Party Claim, such Indemnifying
Party shall not be liable to such Indemnitee under this Section 5.2 for any
attorneys' fees or other expenses subsequently incurred by such Indemnitee in
connection with the defense thereof other than those expenses referred to in
the preceding sentence; PROVIDED, HOWEVER, that such Indemnitee shall have
the right to employ one law firm as counsel ("Primary Counsel"), together
with a local law firm in each applicable jurisdiction (collectively, "Local
Counsel") and, in the case of patent litigation, special patent counsel
("Special Patent Counsel" and together with Primary Counsel and Local
Counsel, "Separate Counsel"), to represent such Indemnitee in any action or
group of related actions (which firm or firms shall be reasonably acceptable
to the Indemnifying Party) if, in such Indemnitee's reasonable judgment at
any time, either a conflict of interest between such Indemnitee and such
Indemnifying Party exists in respect of such claim, or there may be defenses
available to such Indemnitee which are significantly different from or in
addition to those available to such Indemnifying Party and the representation
of both parties by the same counsel would, in the reasonable judgment of the
Indemnitee, be inappropriate, and in that event (i) the reasonable fees and
expenses of such Separate Counsel shall be paid by such Indemnifying Party
(it being understood, however, that the Indemnifying Party shall not be
liable for the expenses of more than one Primary Counsel, one Local Counsel
in any one jurisdiction and one Special Patent Counsel with respect to any
Third-Party Claim (even if against multiple Indemnitees)) and (ii) each of
such Indemnifying Party and such Indemnitee shall have the right to conduct
its own defense in respect of such claim. If an Indemnifying Party: (i)
elects not to defend against a Third-Party Claim; (ii) fails to notify an
Indemnitee of its election as provided in this Section 5.2 within the period
of ten (10)
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Business Days described above; or (iii) elects to defend a Third Party Claim
but, in the reasonable judgment of the Indemnitee, fails to timely, properly
and adequately defend such claim, the Indemnitee may defend, compromise, and
settle such Third-Party Claim and shall be entitled to indemnification
hereunder (to the extent permitted hereunder); PROVIDED, HOWEVER, that no
such Indemnitee may compromise or settle any such Third-Party claim without
the prior written consent of the Indemnifying Party, which consent shall not
be unreasonably withheld or delayed. Notwithstanding the foregoing, the
Indemnifying Party shall not, without the prior written consent of the
Indemnitee, (i) settle or compromise any Third-Party Claim or consent to the
entry of any judgment which does not include as an unconditional term thereof
the dismissal without prejudice of such Third Party Claim or delivery by the
claimant or plaintiff to the Indemnitee of a written release from all
liability in respect of such Third-Party Claim or (ii) settle or compromise
any Third-Party Claim in any manner that would be reasonably likely to have a
material adverse effect on the Indemnitee. Notwithstanding the above, with
respect to any Third-Party Claim or other claim that relates to Taxes, the
relevant provisions of the Tax Sharing Agreement, rather than this Section
5.2, shall govern the rights and obligations of the parties regarding
procedures for indemnification.
5.3. CERTAIN LIMITATIONS.
(a) The amount of any indemnifiable losses or other liability for
which indemnification is provided under this Agreement shall be net of any
amounts actually recovered by the Indemnitee from third parties (including,
without limitation, amounts actually recovered under insurance policies) with
respect to such indemnifiable losses or other liability. Any Indemnifying
Party hereunder shall be subrogated to the rights of the Indemnitee upon
payment in full of the amount of the relevant indemnifiable loss. An insurer
who would otherwise be obligated to pay any claim shall not be relieved of
the responsibility with respect thereto or, solely by virtue of the
indemnification provision hereof, have any subrogation rights with respect
thereto. If any Indemnitee recovers an amount from a third party in respect
of an indemnifiable loss for which indemnification is provided in this
Agreement after the full amount of such indemnifiable loss has been paid by
an Indemnifying Party or after an Indemnifying Party has made a partial
payment of such indemnifiable loss and the amount received from the third
party exceeds the remaining unpaid balance of such indemnifiable loss, then
the Indemnitee shall promptly remit to the Indemnifying Party the excess (if
any) of (A) the sum of the amount theretofore paid by such Indemnifying Party
in respect of such indemnifiable loss plus the amount received from the third
party in respect thereof LESS (B) the full amount of such indemnifiable loss
or other liability. Nothing in this Section 5.3(a) shall obligate any
Indemnifying Party to seek to recover any amounts from any third party
(including, without limitation, amounts recoverable under insurance policies)
prior to, or as a condition to, seeking indemnification under this Article 5.
(b) The amount of any loss or other liability for which
indemnification is provided under this Agreement shall be (i) increased to
take account of any net tax cost incurred by the Indemnitee arising from the
receipt or accrual of an indemnification payment hereunder (grossed up for
such increase) and (ii) reduced to take account of any net tax benefit
realized by the Indemnitee arising from incurring or paying such loss or
other liability. In computing the
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amount of any such tax cost or tax benefit, the Indemnitee shall be deemed to
recognize all other items of income, gain, loss, deduction or credit before
recognizing any item arising from the receipt or accrual of any
indemnification payment hereunder or incurring or paying any indemnified
loss. Any indemnification payment hereunder shall initially be made without
regard to this Section 5.3(b) and shall be increased or reduced to reflect
any such net tax cost (including gross-up) or net tax benefit only after the
Indemnitee has actually realized such cost or benefit. For purposes of this
Agreement, an Indemnitee shall be deemed to have "actually realized" a net
tax cost or a net tax benefit to the extent that, and at such time as, the
amount of taxes payable by such Indemnitee is increased above or reduced
below, respectively, the amount of taxes that such Indemnitee would be
required to pay but for the receipt or accrual of the indemnification payment
or the incurrence or payment of such loss, as the case may be. The amount of
any increase or reduction hereunder shall be adjusted to reflect any final
determination with respect to the Indemnitee's liability for taxes, and
payments between such indemnified parties to reflect such adjustment shall be
made if necessary.
(c) Any indemnification payment made under this Agreement relating
to Assumed Liabilities, Excluded Assets and Excluded Liabilities shall be
characterized for tax purposes as if such payment were made immediately prior
to the Distribution Date, except to the extent otherwise required by
the Tax Sharing Agreement.
ARTICLE 6
ACCESS TO INFORMATION; CONFIDENTIALITY
6.1. ACCESS TO INFORMATION. During the Retention Period, each of the
parties hereto shall cooperate with and afford, and shall cause their
respective Affiliates, Representatives, Subsidiaries, successors and/or
assignees, and shall use reasonable efforts to cause joint ventures that are
not Affiliates (collectively, "Related Parties") to cooperate with and
afford, to the other party reasonable access upon reasonable advance written
request to all Information (other than Information which is: (i) protected
from disclosure by the attorney client privilege or work product doctrine;
(ii) confidential in nature; or (iii) the subject of a confidentiality
agreement between such party and a third party which prohibits disclosure to
the other party) within such party's or any Related Party's possession that
was created prior to the Contribution Date or would otherwise be relevant to
the performance of this Agreement or any Ancillary Agreement. Access to the
requested information shall be provided so long as it relates to the
requesting party's (the "Requestor") business, assets or liabilities, and
access is reasonably required by the Requestor as a result of the parties'
Prior Relationship for purposes of auditing, accounting, claims or litigation
(except for claims or litigation between the parties hereto), employee
benefits, regulatory or Tax purposes or fulfilling disclosure or reporting
obligations including, without limitation, Information reasonably necessary
for the preparation of reports required by or filed under the Exchange Act
with respect to any period entirely or partially prior to the Contribution
Date.
Access as used in this paragraph shall mean the obligation of a
party in possession of Information (the "Possessor") requested by the
Requestor to exert its reasonable efforts to locate all requested Information
that is owned and possessed by Possessor or any Related Party. The Possessor,
at its own expense, shall conduct a diligent search designed to identify all
requested
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Information and shall collect all such Information for inspection by the
Requestor during normal business hours at the Possessor's place of business.
Subject to confidentiality and/or security provisions as the Possessor may
reasonably deem necessary, the Requestor may have all requested Information
duplicated at Requestor's expense. Alternatively, the Possessor may choose to
deliver, at its own expense, all requested Information to the Requestor in
the form it was requested by the Requestor. If so, the Possessor shall notify
the Requestor in writing at the time of delivery if such Information is to be
returned to the Possessor. In such case, the Requestor shall return such
Information when no longer needed to the Possessor at the Possessor's expense.
In connection with providing Information pursuant to this Section
6.1, each of the parties hereto shall upon the request of the other party
make available its respective employees (and those of their respective
Related Parties, as applicable) to the extent that they are reasonably
necessary to discuss and explain all requested Information with and to the
requesting party.
6.2. RECORD RETENTION.
(a) BOOKS AND RECORDS. Stratos shall preserve and keep all books
and records included in the Opto Assets or otherwise in the possession of
Stratos or its Related Parties, whether in electronic form or otherwise, for
not less than ten years from the Contribution Date, or for any longer period
as may be required (i) by any government agency, or (ii) in connection with
any litigation, law, regulation, audit or appeal of Taxes, Tax examination or
the expiration of the applicable statute of limitations, where applicable
(the "Retention Period") at Stratos' sole cost and expense. If Stratos wishes
to dispose of any books and records or other documents which it is obligated
to retain under this Section 6.2 after the Retention Period, then Stratos
shall first provide ninety (90) days' written notice to Methode and Methode
shall have the right, at its option and expense, upon prior written notice
within such ninety (90) day period, to take possession of such books or
records or other documents within one hundred eighty (180) days after the
date of Stratos' notice to Methode hereunder. Written notice of intent to
dispose of such books and records shall include a description of the books
and records in detail sufficient to allow Methode to reasonably assess its
potential need to retain such materials. In the event Stratos enters into an
agreement with a third party to sell a portion of its business, together with
the books and records related thereto, Methode shall have the right, at its
cost, to duplicate such books and records prior to any such disposition and,
should the purchaser of the Stratos business be a competitor of Methode,
Methode shall have the right to prohibit the transfer or disclosure to such
party of that portion of the former books and records of Methode which
Methode notifies Stratos contain confidential and proprietary information
which relates solely to Methode's businesses (other than the Opto Business).
To the extent that books and records of Methode or any of its Affiliates that
contain information relating to the Opto Business are not included in the
Opto Assets, Methode agrees to cooperate with Stratos in providing Stratos
with any such information upon Stratos' reasonable request to the extent that
any such information exists and is reasonably separable from Methode
information unrelated to the Opto Business. Stratos shall reimburse Methode
for all of its reasonable out-of-pocket costs incurred in connection with any
such request.
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(b) ACCESS TO PERSONNEL. Methode shall, from time to time, at the
reasonable request of Stratos, cooperate fully with Stratos in providing
Stratos, to the extent reasonably possible through applicable Methode
employees, with technical assistance and information in respect to any claims
brought against Stratos involving the conduct of the Opto Business prior to
the Contribution Date, including consultation and/or the appearance(s) of
such persons on a reasonable basis as expert or fact witnesses in trials or
administrative proceedings.
6.3. PRODUCTION OF WITNESSES. Each of the parties hereto shall use
all commercially reasonable efforts, and shall cause each of their respective
Affiliates to use all commercially reasonable efforts, to make available to
each other, upon written request, its directors, officers, employees and
other Representatives as witnesses to the extent that any such Person may
reasonably be required (giving consideration to the business demands upon
such Persons) in connection with any legal, administrative or other
proceedings in which the requesting party may from time to time be involved;
PROVIDED, HOWEVER, that with respect to any legal or administrative
proceedings relating to the Tax liability of any of the parties hereto or any
of their respective Affiliates, each of the parties hereto shall, and shall
cause each of their respective Affiliates to, make their directors, officers,
employees and other Representatives available as witnesses or to provide
assistance or information relating to Taxes until such time as the statute of
limitations has expired with respect to all Tax years prior to and including
the years in which the Distribution and the transfers contemplated by this
Agreement are consummated.
6.4. REIMBURSEMENT. Unless otherwise provided in Article 5 or this
Article 6, each party to this Agreement providing access, information or
witnesses to another party pursuant to Sections 6.1, 6.2 or 6.3 shall be
entitled to receive from the recipient, upon the presentation of invoices
therefor, payment for all reasonable out-of-pocket costs and expenses
(excluding allocated compensation, salary and overhead expense) as may be
reasonably incurred in providing such information or witnesses.
6.5. CONFIDENTIALITY.
(a) Subject to Section 6.5(c) below, Methode and Stratos, on behalf
of itself and its Affiliates, each agrees to hold, and cause its respective
directors, officers, employees and other Representatives to hold, in strict
confidence, with at least the same degree of care that applies to its own
confidential and proprietary information, all Information concerning the
other party and its Affiliates that is either in its possession (including
Information in its possession prior to the Contribution Date) or furnished by
such other party or its Affiliates at any time pursuant to this Agreement,
any Ancillary Agreement or otherwise, and shall not use any such Information
other than for such purposes as shall be expressly permitted hereunder or
thereunder, except, in each case, to the extent that such Information has
been: (i) in the public domain through no fault of such party, any of its
Affiliates or any of their respective directors, officers, employees or other
Representatives, (ii) later lawfully acquired from other sources by such
party (or any of its Affiliates which sources are not themselves bound by a
confidentiality obligation), or (iii) independently generated without
reference to any proprietary or confidential Information of the other party.
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(b) Each party agrees not to release or disclose, or permit to be
released or disclosed, any such Information to any other Person, except its
directors, officers, employees and other Representatives who need to know
such Information (who shall be advised of their obligations hereunder with
respect to such Information), except in compliance with this Section 6.5.
Without limiting the foregoing, when any Information is no longer needed for
the purposes contemplated by this Agreement or any Ancillary Agreement, each
party will promptly after request of the other party either return to the
other party all Information in a tangible form (including all copies thereof
and all notes, extracts or summaries based thereon) or certify to the other
party that it has destroyed such Information (and such copies thereof and
such notes, extracts or summaries based thereon).
(c) In the event that any party or any of its Affiliates either
determines on the advice of its counsel that it is required to disclose any
Information pursuant to applicable law or receives any demand under lawful
process or from any Governmental Authority to disclose or provide Information
of the other party (or its Affiliates) that is subject to the confidentiality
provisions hereof, such party shall notify the other party prior to
disclosing or providing such Information and shall cooperate at the expense
of the requesting party in seeking any reasonable protective arrangements
requested by such party. Subject to the foregoing, the party that received
such request may thereafter disclose or provide Information to the extent
required by such law (as so advised by counsel) or by lawful process or such
Governmental Authority.
ARTICLE 7
MUTUAL RELEASES
7.1. RELEASE OF PRE-SEPARATION CLAIMS.
(a) STRATOS RELEASE. Except as provided in Section 7.1(c), as of
the Contribution Date, Stratos does hereby, for itself and as agent for each
of its Subsidiares, remise, release and forever discharge the Methode
Indemnitees from any and all Liabilities, existing or arising from any acts
or events occurring or failing to occur or alleged to have occurred or to
have failed to occur or any conditions existing or alleged to have existed on
or before the Contribution Date, including in connection with the
transactions and all other activities to implement any of the separation of
the Opto Business, the initial public offering by Stratos and the
Distribution.
(b) METHODE RELEASE. Except as provided in Section 7.1(c), as of
the Contribution Date, Methode does hereby, for itself and as agent for each
of its Subsidiaries, remise, release and forever discharge the Stratos
Indemnitees from any and all Liabilities, existing or arising from any acts
or events occurring or failing to occur or alleged to have occurred or to
have failed to occur or any conditions existing or alleged to have existed on
or before the Contribution Date, including in connection with the
transactions and all other activities to implement any of the separation of
the Opto Business, the initial public offering by Stratos and the
Distribution.
(c) NO IMPAIRMENT. Nothing contained in Section 7.1(a) or (b) shall
impair the rights or obligations of Methode and Stratos, as applicable, (i)
reflected on the Stratos Financial Statements, or (ii) arising under this
Agreement and/or the Ancillary Agreements.
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(d) NO ACTIONS AS TO RELEASED CLAIMS. Stratos agrees, for itself
and as agent for each of its Subsidiaries, not to make any claim or demand,
or commence any action, suit or other similar proceeding asserting any claim
or demand, including any claim of contribution or any indemnification,
against Methode or any of its Subsidiaries, or any other Person released
pursuant to Section 7.1(a), with respect to any Liabilities released pursuant
to Section 7.1(a). Methode agrees, for itself and as agent for each of its
Subsidiaries, not to make any claim or demand, or commence any action, suit
or other similar proceeding asserting any claim or demand, including any
claim of contribution or any indemnification, against Stratos or any of its
Subsidiaries, or any other Person released pursuant to Section 7.1(b), with
respect to any Liabilities released pursuant to Section 7.1(b).
(e) FURTHER INSTRUMENTS. At any time, at the request of any other
party, each party shall, or shall cause its Subsidiaries to, execute and
deliver releases reflecting the provisions hereof.
ARTICLE 8
INSURANCE MATTERS
8.1 STRATOS INSURANCE COVERAGE DURING THE INSURANCE TRANSITION PERIOD.
(a) Throughout the period beginning on the Separation Date and
ending on the earlier of (i) the Distribution Date, (ii) the date Methode
owns less than fifty percent (50%) of the outstanding Stratos Common Stock,
or (iii) such earlier date as the parties agree (the "Insurance Transition
Period"), Methode shall, subject to insurance market conditions and other
factors beyond its control, maintain policies of insurance, including for the
benefit of Stratos and its Subsidiaries, directors, officers, employees or
other covered parties (collectively, the "Stratos Covered Parties") which are
comparable in all material respects to those maintained generally by Methode,
except as the parties otherwise agree; provided, however, that if Methode
determines that: (i) the amount or scope of such coverage will be reduced to
a level inferior in any material respect to the level of coverage in
existence immediately prior to the Insurance Transition Period, or (ii) the
retention or deductible level applicable to such coverage, if any, will be
increased to a level materially greater than the levels in existence
immediately prior to the Insurance Transition Period, Methode shall give
Stratos notice of such determination as promptly as practicable. Upon notice
of such determination, Stratos shall be entitled to no less than ninety (90)
days to evaluate its options regarding continuance of coverage hereunder and
may cancel its interest in all or any portion of such coverage as of any day
within such ninety (90) day period. Except as otherwise provided below,
during the Insurance Transition Period, such policies of insurance shall
cover Stratos Covered Parties for liabilities and losses insured prior to the
Distribution Date.
(b) Stratos shall promptly pay or reimburse Methode, as the case
may be, for its share of premium expenses and all applicable self-insurance
retentions, deductibles, retrospective premium adjustments and similar
amounts with respect to insurance policies in force during the Insurance
Transition Period, and Stratos Covered Parties shall promptly pay or
reimburse Methode for any costs and expenses which Methode may incur in
connection with the insurance
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coverages maintained pursuant to this Section 8.1, including but not limited
to any subsequent premium adjustments. Stratos' share of such expenses shall
be determined in a manner consistent with the parties' allocation of such
expenses prior to the Contribution Date. All payments and reimbursements by
Stratos and Stratos Covered Parties to Methode shall be made within fifteen
(15) days after Stratos' receipt of an invoice from Methode.
(c) The control and administration of insurance policies which are
the subject of this Article 8, including claims against insurance policies
and any modifications to the terms and conditions of such insurance policies,
shall remain with Methode, PROVIDED that, any such action taken by Methode
shall treat fairly all insured parties and their respective claims and shall
not unduly favor one insured party over another. Stratos shall make all
reasonable efforts to facilitate Methode's control and administration of such
insurance policies.
8.2 STRATOS INSURANCE COVERAGE AFTER THE INSURANCE TRANSITION
PERIOD. From and after expiration of the Insurance Transition Period, Stratos
shall be solely responsible for obtaining and maintaining insurance programs
for its risk of loss and such insurance arrangements shall be separate and
apart from Methode's insurance programs. Notwithstanding the foregoing, at
Stratos' request, Methode shall use all commercially reasonable efforts to
assist Stratos in the transition to its own separate insurance programs from
and after the Insurance Transition Period, and shall provide Stratos with any
information in its possession and reasonably available and necessary to
either obtain insurance coverages for Stratos or to assist Stratos in
preventing unintended self-insurance, in whatever form.
8.3 COOPERATION. Methode and Stratos will cooperate with each other
in all respects, and they shall execute any additional documents which are
reasonably necessary or desirable to effectuate the provisions of this
Article 8.
8.4 NO ASSIGNMENT OR WAIVER. This Agreement shall not be considered
as an attempted assignment of any policy of insurance or as a contract of
insurance and shall not be construed to waive any right or remedy of Methode
or its Affiliates in respect of any contract or policy of insurance.
8.5 NO LIABILITY. Stratos, on behalf of itself and its Affiliates,
does hereby agree that Methode and its Affiliates shall have no liability
whatsoever as a result of the insurance policies and practices of Methode and
its Affiliates as in effect at any time prior to the Distribution Date,
including as a result of the level or scope of any such insurance, the
creditworthiness of any insurance carrier, the terms and conditions of any
policy, the adequacy or timeliness of any notice to any insurance carrier
with respect to any claim or potential claim or otherwise, other than as a
result of the gross negligence or wilfull misconduct of Methode and its
Affiliates.
8.6 FURTHER AGREEMENTS. The parties acknowledge that they intend to
allocate financial obligations without violating any laws regarding
insurance, self-insurance or other financial responsibility. If it is
determined that any action undertake pursuant to this Agreement or any
Ancillary Agreement is violative of any insurance, self-insurance or related
financial responsibility law or regulation, the parties agree to work
together to do whatever is necessary to
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comply with such law or regulation while trying to accomplish, as much as
possible, the allocation of financial obligations as intended in this
Agreement and any Ancillary Agreement.
ARTICLE 9
NON-COMPETITION
9.1. METHODE RESTRICTIONS. For a period ending one (1) year after
the Distribution Date, neither Methode nor any of its Affiliates shall engage
in (A) the manufacture or sale of the following products or processes,
outside of its current customer list as of the contribution date: (i)
optoelectronic device connectorization, optical test and characterization of
such optical devices, (ii) custom optical device assembly and/or packaging
processes (including metalization, lensing, package hermeticity, soldering,
polishing and optical testing for one or multiple fiber configurations),
(iii) custom or specialty optical connector design, manufacture and
termination, (iv) passive optical component and circuit assembly splicing or
termination, except for hybrid copper/fiber cable assemblies, (v) multi-fibre
mechanical ribbon splice components and tooling, and/or (vi) optoelectronic
subsystems, or (B) the manufacture of standard fiber optic connector products
and/or accessories; anywhere in the World.
9.2. STRATOS RESTRICTIONS. For a period ending one (1) year after
the Distribution Date, neither Stratos nor any of its Affiliates shall engage
in (A) the manufacture or sale of the following products, outside its current
customer list as of the contribution date, in Europe (including the United
Kingdom): (i) standard cable assemblies terminated with standard fiber optic
connectors, and/or (ii) cable management cabinets and value-added cable
assemblies for local area networks, data centre, telecom and other project
installation driven applications, (B) the manufacture or sale of electronic
interconnect devices anywhere in the World, and/or (C) the sale of standard
cable assembly or cable management cabinets in combination with system
integration or system installation services to end-user clients in the United
States and Europe.
9.3. INJUNCTIVE RELIEF. Each party acknowledges that the
restrictions contained in this Article 9 are reasonable and necessary to
protect the legitimate interests of the other party, do not cause it undue
hardship, and that any violations of any provision of this Article 9 will
result in irreparable injury to the other party and that, therefore, each
party shall be entitled to preliminary and permanent injunctive relief in any
court of competent jurisdiction and to an equitable accounting of all
earnings, profits and other benefits arising from such violation, which
rights shall be cumulative and in addition to any other rights or remedies to
which such party may be entitled. In the event that any court having
jurisdiction shall determine that the foregoing restrictive covenant or other
provisions shall be unreasonable or unenforceable in any respect, then such
covenant and other provisions shall be deemed limited to the extent that such
court deems it reasonable and enforceable, and as so limited shall remain in
full force and effect.
ARTICLE 10
MISCELLANEOUS
10.1. DISPUTE RESOLUTION. Except as otherwise set forth in the
Ancillary Agreements, resolution of any and all disputes arising from or in
connection with this Agreement, whether
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based on contract, tort, or otherwise (collectively, "Disputes"), shall be
exclusively governed by and settled in accordance with the provisions of this
Section 10.1. The parties hereto shall use all commercially reasonable efforts
to settle all Disputes without resorting to mediation, arbitration, litigation
or other third party dispute resolution mechanisms. If any Dispute remains
unsettled, the parties hereby agree to mediate such Dispute using a mediator
reasonably acceptable to all parties involved in such Dispute. If the parties
are unable to resolve such dispute through mediation, each party will be free to
commence proceedings for the resolution thereof. No party shall be entitled to
consequential, special, exemplary or punitive damages.
10.2. ENTIRE AGREEMENT. Except as otherwise set forth in this
Agreement, this Agreement and the Ancillary Agreements shall constitute the
entire agreement between the parties hereto with respect to the subject
matter hereof and shall supersede all prior agreements and understandings,
whether written or oral, between the parties with respect to such subject
matter.
10.3. RELATED PARTY TRANSACTIONS. For so long as Methode
beneficially owns at least fifty percent (50%) of the outstanding shares of
Stratos Common Stock, the approval of a majority of the independent directors
of Stratos shall be required for any transaction between Methode and Stratos
with a value of $50,000 or more, PROVIDED, HOWEVER, that this provision shall
not apply to any transactions under this Agreement or any of the Ancillary
Agreements or purchases by Methode or its Subsidiaries of Stratos products in
the ordinary course of business.
10.4. AUTHORITY. Each of the parties hereto represents to the other
that: (a) it has the corporate power and authority to execute, deliver and
perform this Agreement; (b) the execution, delivery and performance of this
Agreement by it has been duly authorized by all necessary corporate action;
(c) it has duly and validly executed and delivered this Agreement; and (d)
this Agreement is a legal, valid and binding obligation, enforceable against
it in accordance with its terms subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors' rights
generally and general equity principles.
10.5. NOTICES. All notices and other communications hereunder shall
be in writing and shall be delivered in person, by telecopy, by express or
overnight mail delivered by a nationally recognized air courier (delivery
charges prepaid), or by registered or certified mail (postage prepaid, return
receipt requested) to the respective parties as follows:
<TABLE>
<S> <C>
If to Methode: Methode Electronics, Inc.
7401 W. Wilson Avenue
Chicago, Illinois 60706
Attention: Chief Executive Officer
If to Stratos: Stratos Lightwave, Inc.
7444 W. Wilson Avenue
Chicago, Illinois 60706
Attention: Chief Executive Officer
Telecopy No.: (708) 867-3288
</TABLE>
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or to such other address as the party to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
Any notice or communication delivered in person shall be deemed effective on
delivery or when delivery is refused. Any notice or communication sent by
telecopy or by air courier shall be deemed effective on the first Business
Day at the place at which such notice or communication is received following
the day on which such notice or communication was sent.
10.6. AMENDMENT AND MODIFICATION. This Agreement or the Ancillary
Agreements may not be amended or modified in any respect except by a written
agreement signed by both of the parties hereto.
10.7. BINDING EFFECT; ASSIGNMENT. This Agreement and all of the
provisions hereof shall be binding upon the parties hereto and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns. Except with respect to a merger of either party with another Person,
neither this Agreement nor any of the rights, interests or obligations
hereunder shall be assigned by either party hereto without the prior written
consent of the other party, which consent shall not be unreasonably withheld
or delayed; PROVIDED, HOWEVER, that Methode and Stratos may assign their
respective rights, interests, duties, liabilities and obligations under this
Agreement to any of their respective Subsidiaries, but such assignment shall
not relieve Methode or Stratos, as the assignee, of its obligations hereunder.
10.8. THIRD PARTY BENEFICIARIES. The Indemnitees and their
respective successors shall be third party beneficiaries of the
indemnification provisions of Article 5, as applicable, and shall be entitled
to enforce those provisions, in each such case as fully and to the same
extent as if they were parties to this Agreement. Except as provided in the
previous sentence, nothing in this Agreement, express or implied, is intended
to or shall confer upon any Person (other than the Parties and their
successors and assigns) any legal or equitable right, benefit or remedy of
any nature whatsoever under or by reason of this Agreement, and no Person
(other than as provided in the previous sentence) shall be deemed a third
party beneficiary under or by reason of this Agreement.
10.9. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of
which together shall constitute one and the same agreement. The Agreement may
be delivered by facsimile transmission of a signed copy thereof.
10.10. WAIVER. The observance of any term of this Agreement may be
waived (either generally or in a particular instance and either retroactively
or prospectively) by the party entitled to enforce such term, but such waiver
shall be effective only if it is in writing signed by the party against which
such waiver is to be asserted. Unless otherwise expressly provided in this
Agreement, no delay or omission on the part of any party in exercising any
right under this Agreement shall operate as a waiver thereof, nor shall any
waiver on the part of any party of any right under this Agreement operate as
a waiver of any other right under this Agreement nor shall any single or
partial exercise of any right preclude any other or further exercise thereof
or the exercise of any other right under this Agreement. No failure by either
party to take any action or
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assert any right hereunder shall be deemed to be a waiver of such right in
the event of the continuation or repetition of the circumstances giving rise
to such right unless expressly waived in writing by the party against whom
the existence of such waiver is asserted.
10.11. SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof. Any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.
10.12. REMEDIES. Each of Methode and Stratos shall be entitled to
enforce its rights under this Agreement specifically, to recover damages and
costs (including reasonable attorneys' fees) caused by any breach of any
provision of this Agreement and to exercise all other rights existing in its
favor. Each of Methode and Stratos acknowledges and agrees that under certain
circumstances the breach by Methode or any of its Affiliates and Stratos or
any of its Affiliates, of a term or provision of this Agreement will
materially and irreparably harm the other party, that money damages will
accordingly not be an adequate remedy for such breach and that the
non-defaulting party, in its sole discretion and in addition to its rights
under this Agreement and any other remedies it may have at law or in equity,
may apply to any court of law or equity of competent jurisdiction (without
posting any bond or deposit) for specific performance and/or other injunctive
relief in order to enforce or prevent any breach of the provisions of this
Agreement.
10.13. FURTHER ASSURANCES. In addition to actions specifically
provided for elsewhere in this Agreement, each of the parties hereto shall
use all commercially reasonable efforts to take, or cause to be taken, all
actions, and to do, or cause to be done, all things, reasonably necessary,
proper or advisable to consummate the transactions contemplated by this
Agreement and the Ancillary Agreements.
10.14. HEADINGS. The headings of the sections and subsections of
this Agreement are inserted for convenience of reference only and shall not
constitute a part hereof.
10.15. GOVERNING LAW. This Agreement shall be governed, construed
and enforced in accordance with the internal laws of the State of Illinois,
excluding any choice of law rules which may direct the application of the
laws of another jurisdiction.
10.16. CONSENT TO EXCLUSIVE JURISDICTION. Any action, suit or
proceeding arising out of any claim that the parties cannot settle through
good faith negotiations shall be heard and determined in any Illinois state
or federal court sitting in Chicago. Each of the parties hereto hereby
irrevocably and unconditionally: (i) submits to the exclusive jurisdiction of
any Illinois state or federal court sitting in Chicago for any such action,
suit or proceeding; (ii) waives, and agrees not to plead or to make, any
objection to the venue of any such action, suit or proceeding in the
above-named courts; (iii) waives, and agrees not to plead or to make, any
claim that any such action, suit or proceeding brought in the above-named
courts has been brought in an
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improper or otherwise inconvenient forum; and (iv) waives, and agrees not to
plead or to make, any claim that its is not subject personally to the
jurisdiction of the above-named courts.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
duly executed and delivered as of the day and date first written above.
METHODE ELECTRONICS, INC.
By: /s/ William J. McGinley
-------------------------------------
William J. McGinley
Chairman
STRATOS LIGHTWAVE, INC.
By: /s/ James W. McGinley
-------------------------------------
James W. McGinley
President and Chief Executive Officer
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