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Exhibit 2.1
TRANSFORMATION AGREEMENT
This Transformation Agreement (this "Agreement") is entered into as of June
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3, 2000 (the "Signing Date") by and among Cabletron Systems, Inc., a Delaware
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corporation ("CSI"), Aprisma Management Technologies, Inc., a Delaware
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corporation ("Aprisma"), Enterasys Networks, Inc., a Delaware corporation
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("Enterasys"), GlobalNetwork Technology Services, Inc., a Delaware corporation
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("GNTS") and Riverstone Networks, Inc., a Delaware corporation ("Riverstone"
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and collectively with Aprisma, Enterasys and GNTS, the "Newcos"). Capitalized
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terms used herein and not otherwise defined shall have the meanings ascribed to
such terms in Section 8 hereof.
RECITALS
WHEREAS, CSI currently owns all of the issued and outstanding capital stock
of each Newco;
WHEREAS, it is currently contemplated that (i) Compaq Computer Corporation
will invest $14 million in preferred stock of Aprisma and (ii) Silver Lake
Partners, L.P. and other investors will invest in certain purchase rights and
warrants with respect to the equity securities of the Newcos;
WHEREAS, subject to the approval of the stockholders of CSI, the parties
have each determined that it would be appropriate and desirable, in accordance
with the Contribution Agreements, for CSI to contribute and transfer to each
Newco, and for such Newco, to receive and assume, directly or indirectly,
certain assets and liabilities currently held by CSI and its affiliates and
associated with the Aprisma Business in the case of Aprisma, the GNTS Business
in the case of the GNTS, the Riverstone Business in the case of Riverstone and
the Enterasys Business in the case of Enterasys and to consummate the other
transactions contemplated hereby (the "Transformation");
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WHEREAS, the Board of Directors of CSI has determined that the
Transformation will provide flexibility to better develop and implement other
strategic transactions designed to maximize the long-term competitive and
strategic advantages of CSI's products and services by separating the operations
associated with the Aprisma Business, the Enterasys Business, the GNTS Business
and the Riverstone Business;
WHEREAS, CSI has announced that it currently plans to conduct an initial
public offering ("IPO") for each of the Newcos followed by a distribution (a
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"Distribution") of the remaining shares of one or more of the Newcos to CSI's
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stockholders, although CSI is not obligated to complete any such transactions
and will only implement any such transactions if the Board of Directors of CSI
continues to believe that it is in the best interests of CSI, CSI's stockholders
and the Newcos; and
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WHEREAS, the parties intend in this Agreement, including the Exhibits
hereto, to set forth the principal arrangements between them regarding the
Transformation.
NOW, THEREFORE, in consideration of the foregoing and the covenants and
agreements set forth below, the parties hereto agree as follows:
1. DOCUMENTS AND ITEMS TO BE DELIVERED ON THE SIGNING DATE
On the Signing Date, concurrent with the execution and delivery hereof, each of
the parties will duly execute and deliver to each other party which is a party
thereto all of the following items and agreements to which it is a party
(collectively, together with all agreements and documents contemplated by such
agreements, the "Ancillary Agreements"):
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1.1. An Asset Contribution Agreement between CSI and Aprisma (the "Aprisma
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Contribution Agreement") substantially in the form of Exhibit A-1;
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1.2. An Asset Contribution Agreement between CSI and Enterasys (the
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"Enterasys Contribution Agreement") substantially in the form of
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Exhibit A-2;
1.3. An Asset Contribution Agreement between CSI and GNTS (the "GNTS
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Contribution Agreement") substantially in the form of Exhibit A-3;
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1.4. An Asset Contribution Agreement between CSI and Riverstone (the
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"Riverstone Contribution Agreement" and collectively with the
---------------------------------
agreements referenced in Sections 1.1 to 1.3 above, the "Contribution
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Agreements") substantially in the form of Exhibit A-4;
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1.5. An Intercompany Agreement between Aprisma and Enterasys (the "A-E
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Intercompany Agreement") substantially in the form of Exhibit B-1
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attached hereto;
1.6. An Intercompany Agreement between Aprisma and GNTS (the "A-G
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Intercompany Agreement") substantially in the form of Exhibit B-2
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attached hereto;
1.7. An Intercompany Agreement between Aprisma and Riverstone (the "A-R
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Intercompany Agreement") substantially in the form of Exhibit B-3
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attached hereto;
1.8. An Intercompany Agreement between Enterasys and GNTS (the "E-G
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Intercompany Agreement") substantially in the form of Exhibit B-4
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attached hereto;
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1.9. An Intercompany Agreement between Enterasys and Riverstone (the "E-R
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Intercompany Agreement") substantially in the form of Exhibit B-5
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attached hereto;
1.10. An Intercompany Agreement between GNTS and Riverstone (the "G-R
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Intercompany Agreement") substantially in the form of Exhibit B-6
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attached hereto;
1.11. A Tax Sharing Agreement among CSI and all Newcos (the "Tax Sharing
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Agreement") substantially in the form of Exhibit C; and
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1.12. A Flextronics Assignment and Assumption Agreement (the "Manufactured
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Products Agreement") between CSI and Enterasys substantially in the
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form of Exhibit D hereto.
2. TRANSFORMATION
2.1. Signing Date. The parties acknowledge and agree that the Newcos,
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either as separate entities or through their predecessor divisions of
CSI, will conduct business in accordance with the terms and
conditions hereof and of the Ancillary Agreements from and after the
Signing Date.
2.2. Transformation Date. Subject to the approval of the Transformation
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by the stockholders of CSI and the other conditions set forth in
Section 7 hereof and in the Ancillary Agreements, the effective time
and date of the Transformation and the consummation of the
transactions contemplated hereby and by the Ancillary Agreements
shall be 11:59 p.m., Boston Time, July 29, 2000 or such other date as
may be fixed by CSI (the "Transformation Date"). To the extent that
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any Contribution Agreement provides for the transfer of assets or
liabilities held by a Subsidiary of CSI, the capital stock of which
is to be transferred to a Newco other than that Newco to which such
assets or liabilities are to be transferred, the transfer of such
assets and liabilities shall occur immediately prior to the transfer
of the capital stock of such Subsidiary.
2.3. Closing of Transactions. The closing of the transactions hereby and
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by the Ancillary Agreements (the "Closing") shall occur on the
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Transformation Date at the offices of Ropes & Gray, One International
Place, Boston, Massachusetts 02110, by the execution and delivery of
the instruments of transfer, assumptions of liability, undertakings,
agreements, instruments or other documents to be delivered on the
Transformation Date pursuant to this Agreement and the Ancillary
Agreements.
3. POST-TRANSFORMATION TRANSACTIONS INVOLVING THE NEWCOS
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3.1. Discretion of CSI. No Newco shall commence or consummate an IPO
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without the approval of CSI and all terms, including the timing of,
an IPO shall be subject to CSI's approval. CSI shall, in its sole and
absolute discretion, determine whether to consummate a Distribution
with respect to any Newco and the terms and conditions of any such
Distribution. The parties acknowledge that (i) CSI is not obligated
to complete any such IPO or Distribution and will only implement any
such transaction if the Board of Directors of CSI continues to
believe that it is in the best interest of CSI, CSI's stockholders
and the Newcos and (ii) CSI may pursue other strategic alternatives
in lieu of an IPO and/or Distribution with respect to any Newco.
3.2. IRS Ruling. The parties acknowledge that CSI currently plans to seek
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a private letter ruling from the Internal Revenue Service to the
effect that (i) Section 355 of the Code will apply to a Distribution
of Newco stock by CSI to CSI's stockholders; and (ii) no gain or loss
will be recognized by (and no amounts will be included in the income
of) the stockholders of CSI upon their receipt of Newco stock
pursuant to the Distribution.
3.3. Cooperation. If requested by CSI, each Newco shall cooperate with
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CSI in all respects to accomplish an IPO and Distribution with
respect to such Newco and shall, at CSI's direction, promptly take
any and all actions necessary or desirable to effect such IPO or
Distribution, including, without limitation: filing a registration
statement with respect to the IPO under the Securities Act, including
any amendments thereto as may be required; making any filings under
the Exchange Act; entering into an underwriting agreement with
respect to the IPO; preparing an information statement with respect
to the Distribution; filing any documents with the Commission as may
be required with respect to an IPO or Distribution; listing the stock
of such Newco on the Nasdaq National Market or a stock exchange
selected by CSI; and obtaining, and complying with the terms of, any
private letter ruling from the Internal Revenue Service as described
in Section 3.2 above. CSI shall select any underwriter(s), investment
banker(s) and manager(s) in connection with an IPO and Distribution,
as well as any financial printer, solicitation and/or exchange agent
and outside legal counsel for CSI and each Newco in connection with
an IPO and a Distribution.
4. CERTAIN COVENANTS AND OTHER MATTERS
4.1. Other Agreements.
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4.1.1. Instruments and Agreements. The parties agree to execute
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or cause to be executed by the appropriate parties and
deliver, as appropriate at the Closing, such other
agreements, instruments and other documents as may be
necessary or desirable in order to effect
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the purposes of this Agreement and the Ancillary Agreements,
including without limitation as contemplated by this Section
4.1 below.
4.1.2. Retained Third Party Tools. The parties acknowledge that
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pursuant to the terms of the Contribution Agreements, rights
with respect to certain Third Party Tools (as such term is
defined in the Contribution Agreements), including without
limitation those Third Party Tools set forth on Schedule 3.4
to each Contribution Agreement, will be retained by CSI and
not be contributed to any one Newco pursuant to a
Contribution Agreement (the "Retained Third Party Tool
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Rights"). CSI acknowledges that certain of the Retained
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Third Party Tool Rights may be necessary or useful for the
performance of the business of certain Newcos and to such
extent agrees to hold such Retained Third Party Tool Rights
for the use and benefit, insofar as reasonably possible and
not in violation of their terms, of such Newcos (at the
expense of such Newcos) and shall take such other actions as
may be reasonably required in order to place such Newcos,
insofar as reasonably possible and not in violation of such
Retained Third Party Tool Rights, in the same position as if
such Retained Third Party Tool Rights had been transferred
to such Newcos under the relevant Contribution Agreements.
The parties acknowledge and agree that this Section 4.1.2 is
not intended to extend the use of any Retained Third Party
Tool Rights beyond their current and historical use by CSI
and its businesses, but rather to enable the continued use
of such Retained Third Party Tools consistent with their
current and historical use by CSI and its businesses.
4.1.3. Licenses with Respect to Principal Intellectual Property.
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At the Closing, the parties will enter into licensing
agreements that are intended to, among other things, allow
each Newco to use only that intellectual property of another
party necessary for the Newco to conduct its respective
business as of the Closing. These licensing agreements (the
"License Agreements") will include:
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A license agreement from Aprisma to GNTS allowing GNTS to
develop tools GNTS may use in providing services to third
parties, provided that GNTS may not exercise those rights to
develop software products competitive with those of the
Aprisma Business as of the Closing;
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A license agreement from Enterasys to GNTS allowing GNTS to
conduct the GNTS Business, provided that GNTS may not
exercise those rights to develop products competitive with
those of the Enterasys Business as of the Closing;
A license agreement from Riverstone to GNTS allowing GNTS to
conduct the GNTS Business, provided that GNTS may not
exercise those rights to develop products competitive with
those of the Riverstone Business as of the Closing;
A cross-license agreement between Enterasys and Aprisma
allowing each to conduct its respective business, provided
that neither may exercise those rights to develop products
competitive with those of the other's business as of the
Closing;
A cross-license agreement between Riverstone and Aprisma
allowing each to conduct its respective business, provided
that neither may exercise those rights to develop products
competitive with those of the other's business as of the
Closing;
A cross-license agreement between Enterasys and Riverstone
allowing each to conduct its respective business, provided
that no license will be granted to Riverstone with respect
to any wireless technologies, and provided further that this
cross-license agreement will contain provisions
substantially based on the terms outlined on Exhibit E
hereto with respect to Riverstone making available to
Enterasys certain ASICs and related data for SSR products;
and
License Agreements between CSI and each Newco allowing each
Newco to use that intellectual property of CSI that is not
Contributed Intellectual Property (as defined in the
respective Contribution Agreements) of any Newco and is
necessary to allow such Newco to conduct its business.
4.1.4. Shared Services Agreements. At the Closing and at the
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direction of CSI, each of the Newcos will enter into a
Shared Services Agreement (collectively the "Shared Services
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Agreements") with respect to certain corporate, human
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resource, information technology, accounting, and other
services that have been provided by CSI to the Newcos or
their predecessor divisions of CSI since March 1, 2000, and
that will continue to be provided by CSI to the Newcos on an
interim basis, after the Transformation Date. Each Shared
Services Agreement will provide for service charges for such
services. Each Shared Services Agreement will also permit
CSI to engage subcontractors, including the Newcos, to
perform all or any portion of the services described
therein. The applicable Newco or Newcos will enter into
agreements with CSI with respect to the provision of certain
of such services by such Newco(s). The Shared Services
Agreements, subject to certain limitations, will
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also allow CSI and the Newcos to adjust from time to time
the nature and level of services to be provided thereunder.
4.2 Agreement for Exchange of Information
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4.2.1. General. CSI shall provide to each Newco, and each Newco
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shall provide to CSI at any time before a Distribution with
respect to such Newco, any Information in the possession or
under the control of such party that the requesting party
reasonably needs (i) to comply with reporting, disclosure,
filing or other requirements imposed on the requesting party
(including under applicable securities laws) by a
Governmental Authority having jurisdiction over the
requesting party, (ii) for use in preparing its financial
statements; (iii) for use in any other judicial, regulatory,
administrative or other proceeding or in order to satisfy
audit, accounting, claims, regulatory, litigation or other
similar requirements, (iv) to comply with its obligations
under this Agreement or any Ancillary Agreement or (v) in
connection with its respective ongoing business; provided,
however, that in the event that any party determines that
any such provision of Information could be commercially
detrimental, violate any law or agreement, or waive any
attorney-client privilege, the parties shall take all
reasonable measures to permit the compliance with such
obligations in a manner that avoids any such harm or
consequence.
4.2.2. Continued Cooperation after a Distribution. After a
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Distribution with respect to a Newco (except in the case of
a legal or other proceeding by one party against another
party which shall be governed by such discovery rules as may
be applicable under Section 4.10 or otherwise), CSI and such
Newco shall use its reasonable commercial efforts to make
available to each other party, upon written request, the
former, current and future directors, officers, employees,
other personnel and agents of such party as witnesses and
any books, records or other documents within its control or
which it otherwise has the ability to make available, to the
extent that any such person (giving consideration to
business demands of such directors, officers, employees,
other personnel and agents) or books, records or other
documents may reasonably be required in connection with any
legal, administrative or other proceeding in which the
requesting party may from time to time be involved,
regardless of whether such legal, administrative or other
proceeding is a matter with respect to which indemnification
may be sought hereunder. The requesting party shall bear all
costs and expenses in connection therewith except as to
those proceedings as to which the requesting party is
entitled to indemnity from the other party.
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4.2.3. Ownership of Information. Any Information owned by a party
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that is provided to a requesting party pursuant to this
Section 4.2 shall be deemed to remain the property of the
providing party. Unless specifically set forth herein or in
the Ancillary Agreements or in an instrument delivered
pursuant hereto or thereto, nothing contained in this
Agreement shall be construed as granting or conferring
rights of license or otherwise in any such Information.
4.2.4. Record Retention. To facilitate the possible exchange of
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Information pursuant to this Section 4.2 and other
provisions of this Agreement and the Ancillary Agreements,
each party agrees to use its reasonable commercial efforts
to retain all Information in its respective possession or
control that might be reasonably required by another party.
4.2.5. Limitation of Liability. No party shall have any liability
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to any other party in the event that any Information
exchanged or provided pursuant to this Section 4.2 is found
to be inaccurate. No party shall have any liability to any
other party if any Information is destroyed or lost.
4.3. Auditors and Audits. Each Newco agrees that, for so long as CSI is
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required in accordance with United States generally accepted
accounting principles to consolidate such Newco's results of
operations and financial position (during such period, such Newco
being referred to as an "Included Newco"):
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4.3.1. Selection of Auditors. Such Included Newco shall not
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select a different accounting firm from that used by CSI to
serve as its independent certified public accountants (its
"auditors") for purposes of providing an opinion on its
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consolidated financial statements without CSI's prior
written consent.
4.3.2. Date of Auditors' Opinion and Quarterly Reviews. The
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parties will cooperate in establishing a timetable for the
preparation of audited financial statements and the
clearance of quarterly financial statements. Each Included
Newco shall use its best efforts to enable its auditors to
complete their audit such that they will date their opinion
on such Included Newco's audited annual financial statements
on the same date that CSI's auditors date their opinion on
CSI's audited annual financial statements, and to enable CSI
to meet its timetable for the printing, filing and public
dissemination of CSI's annual financial statements. Each
Included Newco shall use its best efforts to enable its
auditors to complete their quarterly review procedures such
that they will provide
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clearance on such Included Newco's quarterly financial
statements on the same date that CSI's auditors provide
clearance on CSI's quarterly financial statements.
4.3.3. Annual and Quarterly Financial Statements. Each Included
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Newco shall provide to CSI and the other Included Newcos on
a timely basis all Information it holds that CSI or another
Included Newco, as applicable, reasonably requires to meet
its schedule for the preparation, printing, filing, and
public dissemination of its annual and quarterly financial
statements. CSI shall provide to each Included Newco on a
timely basis all financial Information it holds that such
Included Newco reasonably requires to meet its schedule for
the preparation, printing, filing, and public dissemination
of its annual and quarterly financial statements. CSI and
each Included Newco shall instruct its auditors and
financial personnel to provide such assistance as is
required to assist in the preparation of CSI's or such
Included Newco's or another Included Newco's, as the case
may be, annual and quarterly statements.
4.3.4. Conflict with Third-Party Agreements. Nothing in Sections
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4.2 and 4.3 shall require any party to violate any agreement
with any third party regarding the confidentiality of
confidential and proprietary information relating to that
third party or its business; provided, however, that in the
event that a party is required under Sections 4.2 and 4.3 to
disclose any such Information, it shall use all commercially
reasonable efforts, but without payment of additional
amounts and without other concessions, to seek to obtain
such third party's consent to the disclosure of such
information.
4.4. Confidentiality. Each of the parties and its affiliates shall hold as
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confidential and shall not, except with the express prior written
consent of the party which owns such confidential information (in the
case of confidential information existing prior to the Transformation
Date, the ownership of which shall be determined pursuant to the
Contribution Agreements and the other Ancillary Agreements) directly
or indirectly disclose, communicate or divulge to any Person, or use
for the benefit of any Person, any information or data with respect to
the conduct or details of the business of any other party hereto held
as confidential information by such party whether obtained pursuant to
Section 4.2 hereof or otherwise, including, without limitation,
methods of operation, customers and customer lists, details of
contracts with customers, consultants, suppliers or employees,
products, proposed products, former products, proposed, pending or
completed acquisitions of any company, division, product line or other
business unit, prices and pricing policies, fees, costs, plans,
designs, technology, inventions, trade secrets, know-how, software,
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marketing methods, policies, plans, personnel, or other proprietary
matters (collectively, "Confidential Information"). The restriction
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contained in the preceding sentence shall not apply to any
Confidential Information to the extent that (i) such information is
publicly available, (ii) such information is or hereafter becomes
lawfully obtainable from other sources without breach hereof, (iii)
the disclosure is made to a Governmental Authority where it is
necessary or appropriate to disclose such information to such
Governmental Authority having jurisdiction over the parties, or (iv)
disclosure is otherwise required by any legal requirement; provided,
however that in the cases set forth in clauses (iii) and (iv) above,
the disclosing party shall provide prior notice to the owner of the
Confidential Information and take reasonable steps to assist such
owner in contesting the requirement for the disclosure thereof. The
parties acknowledge that treatment of confidential information
exchanged pursuant to the Intercompany Agreements and the License
Agreements shall be governed by the provisions of such agreements and
not this Section 4.4.
4.5. Employee Confidentiality Agreements. Any agreement or instrument
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relating to confidentiality, non-disclosure or non-competition
obligations of a former employee of CSI and its affiliates who has
been, or a current employee of CSI who will be, transferred to a Newco
in connection with the Transformation (a "CSI Confidentiality
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Agreement") shall remain in full force and effect according to its
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terms; provided, however, that none of the following acts committed by
former CSI employees within the scope of their employment with a
particular Newco shall constitute a breach of such CSI Confidentiality
Agreements: (i) the use or disclosure of confidential information of
CSI for or on behalf of such Newco, if such disclosure is consistent
with the rights granted to such Newco and restrictions imposed on such
Newco under this Agreement, any Ancillary Agreement or any other
agreement between the parties; (ii) the rendering of any services,
directly or indirectly, to such Newco to the extent such services are
consistent with the rights granted to such Newco and the restrictions
imposed on such Newco under this Agreement, any Ancillary Agreement or
any other agreement between the parties. CSI hereby retains all of its
rights under the CSI Confidentiality Agreements (except as provided in
the immediately preceding sentence), but hereby transfers and assigns
to each Newco a portion of its rights under the CSI Confidentiality
Agreements of all former CSI employees employed by such Newco to the
extent required to permit such Newco to enjoin, restrain, recover
damages from or obtain specific performance of the CSI Confidentiality
Agreements or obtain other remedies against any Newco employee who
breaches his or her CSI Confidentiality Agreement. CSI and the
relevant Newco may separately enforce the CSI Confidentiality
Agreements of former CSI employees employed by such Newco, in the case
of such Newco, to the extent necessary to reasonably protect its
interests; provided, however, that such Newco shall not commence any
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legal action relating thereto without CSI's written consent. In
addition, each Newco shall use reasonable commercial efforts to cause
each of its employees to execute a new confidentiality agreement which
protects the confidential information of such Newco (each a "Newco
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Confidentiality Agreement"). CSI and each Newco agree to cooperate as
-------------------------
follows: (A) each Newco shall advise CSI of any violation(s) of the
CSI Confidentiality Agreements by former CSI employees and cooperate
with CSI in enforcing the CSI Confidentiality Agreements; (B) CSI
shall use reasonable commercial efforts to enforce its rights under
the CSI Confidentiality Agreements and (C) each Newco shall use
reasonable commercial efforts to enforce its rights under the Newco
Confidentiality Agreements.
4.6. CSI Guidelines, etc. Each Newco acknowledges that until a
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Distribution with respect to such Newco, (i) such Newco will be
subject to general CSI oversight and will follow CSI's corporate
guidelines as from time to time in effect. Without limiting the
foregoing, without prior CSI written approval (which written approval
may be evidenced by (i) the affirmative vote of the chief executive
officer of CSI in connection with a vote of the Board of Directors of
such Newco if he is a member of such Board or (ii) if the chief
executive officer of CSI is not a member of such Board, by the
affirmative vote of all officers of CSI sitting on such Board in
connection with a vote of such Board), no Newco shall:
(i) amend (A) its By-laws, (B) its 2000 Option Plan (including
any increase in the shares available for issuance under
such plan), or (C) any awards issued under its 2000 Option
Plan;
(ii) issue any equity securities or other securities other than
options under its 2000 Option Plan;
(iii) grant any stock options or other rights to purchase any
equity securities or other securities of such Newco in
excess of the options reserved under its 2000 Option Plan;
(iv) grant any rights to serve on its Board of Directors; or
(v) make any significant changes in its accounting or financial
reporting policies.
4.7. Intercompany Agreements. The parties acknowledge and agree that the
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Newcos, either as separate entities or through their predecessor
divisions of CSI, have conducted business in accordance with the terms
and conditions reflected in the Intercompany Agreements from March 1,
2000 through the date hereof and shall continue to do so through the
Transformation.
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4.8. Rainbow Awards. In the event of a Distribution by CSI of shares of
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stock of a Newco (the "Distributed Newco"), the Distributed Newco
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shall cause there to be issued, to each "eligible individual" (as
hereinafter defined) who at the close of the record date for the
Distribution holds an option to acquire shares of CSI stock that has
been granted in connection with the performance of services other than
an option under CSI's stock purchase program or programs (any such
eligible individual being hereinafter referred to as a "Recipient" and
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any such option held by a Recipient at the close of the record date
for the Distribution being hereinafter referred to as an "Eligible CSI
------------
Option"), an option (the "Rainbow Option") to acquire, on the terms
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hereinafter provided, shares of stock of the same class as the stock
distributed generally in the Distribution ("Newco Stock"). Subject to
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adjustment as referenced below, each Rainbow Option shall be for the
number of shares of Newco Stock that the Recipient would have been
entitled to receive in the Distribution with respect to the shares of
CSI stock subject to the Eligible CSI Option if he or she had owned
such shares of CSI stock outright on the record date of the
Distribution. The per-share exercise price for each Rainbow Option
shall be fixed in such manner as CSI in its sole discretion determines
to be appropriate to reflect the Distribution. CSI, in connection
with the Distribution, shall also reduce the per-share exercise price
of each Eligible CSI Option to such extent, if any, as it deems
appropriate to reflect the Distribution. It is the intention of the
parties that the provisions of this Section 4.8 shall be administered
insofar as is possible to preserve, with respect to the Rainbow Option
and the Eligible CSI Option immediately after the Distribution, the
same aggregate spread between fair market value of the shares
underlying those options and exercise price and the same ratio of
exercise price to the fair market value of the shares underlying those
options as existed with respect to the Eligible CSI Option immediately
before the record date of the Distribution. The number of shares
subject to the Rainbow Option and CSI options shall be subject to
adjustment as necessary to accomplish this end, as determined by CSI.
For purposes of this Section 4.8, the term "eligible individual"
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means, except as CSI may otherwise determine, an individual who at the
time of the Distribution is an employee of CSI or of an entity that is
then a subsidiary of CSI. Each Rainbow Option shall be subject to
terms substantially similar to those which apply to other stock
options issued by the Distributed Newco, except that the vested status
and exercisability of the Rainbow Option, and the term and expiration
provisions of such option, shall be the same as the Eligible CSI
Option to which it relates. It is the intention of the parties to
more fully document the provisions of this Section 4.8 on or prior to
the Closing, and CSI and each Newco shall take such measures as are
necessary to carry out the provisions of this Section 4.8, including,
without limitation, reserving a sufficient number of shares and
causing the shares
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to be registered under the Securities Act and applicable state
securities laws, if any.
4.9. Expenses. Except as otherwise provided in this Agreement, the
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Ancillary Agreements or any other agreement between the parties
relating to the Transformation, each Newco shall be responsible, to
the extent determined reasonable in CSI's sole discretion, for its
own fees, costs and expenses incurred in connection with the
Transformation, any IPO and any Distribution and shall bear its
proportionate share of such fees, costs and expenses incurred by
CSI.
4.10. Dispute Resolution.
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4.10.1. If a dispute, controversy or claim ("Dispute") arises
-------
between or among two or more parties relating to the
interpretation or performance of this Agreement or the
Ancillary Agreements or otherwise relating to the
Transformation, other than a dispute under any Intercompany
Agreement or supplements thereto, any License Agreement or
the Tax Sharing Agreement which shall be resolved in the
manner set forth in the relevant agreement, the appropriate
senior executives of each party who shall have the
authority to resolve the matter shall meet within fifteen
(15) days from the date the Dispute arises to attempt in
good faith to negotiate a resolution of the Dispute prior
to pursuing other available remedies. The earlier of
fifteen (15) days from the date one party notifies the
other party or parties of the Dispute and the date of the
initial meeting between the appropriate senior executives
shall be referred to herein as the "Dispute Resolution
------------------
Commencement Date". Discussions and correspondence relating
-----------------
to trying to resolve such Dispute shall be treated as
confidential information developed for the purpose of
settlement and shall be exempt from discovery or production
and shall not be admissible. Subject to Section 4.10.2
below, if the senior executives are unable to resolve the
Dispute within fifteen (15) days from the Dispute
Resolution Commencement Date, and either party wishes to
pursue its rights relating to such Dispute, then, whether
or not CSI is involved in the Dispute, the parties shall
submit the Dispute to the chief executive officer of CSI
(or such other executive of CSI designated by the chief
executive officer of CSI for this purpose) for resolution.
The chief executive officer (or other designated executive
of CSI) shall resolve such dispute. The decision of the
chief executive officer or other designated executive of
CSI shall be final and binding on the parties hereto.
4.10.2. Notwithstanding the provisions of Section 4.10.1, if the
senior executives of each party are unable to resolve a
Dispute within
-13-
<PAGE>
sixty (60) days from the Dispute Resolution Commencement
Date and at least one party to the Dispute is a Newco which
has consummated an IPO or is no longer a majority-owned
Subsidiary of CSI, and any party wishes to pursue its
rights relating to such Dispute (as evidenced by the
approval of the Board of Directors of such party to pursue
arbitration of the Disputee in accordance with this Section
4.10.2), then the Dispute shall be resolved as set forth
below:
(i) The Dispute shall be submitted to final and binding
arbitration under the then current Commercial Arbitration
Rules of the American Arbitration Association ("AAA"), by
---
three (3) arbitrators in Boston, Massachusetts. Such
arbitrators shall be selected by the mutual agreement of
the parties or, failing such agreement, shall be selected
according to the aforesaid AAA rules. The arbitrators will
be instructed to prepare and deliver a written, reasoned
opinion stating their decision within thirty (30) days of
the completion of the arbitration. The prevailing party in
such arbitration, as determined by the arbitrator, shall
be entitled to expenses, including costs and reasonable
attorneys' and other professional fees, incurred in
connection with the arbitration (but excluding any costs
and fees associated with prior negotiation or mediation).
The decision of the arbitrator shall be final and non-
appealable and may be enforced in any court of competent
jurisdiction.
(ii) Notwithstanding the foregoing Section 4.10.2(i), any
Dispute involving at least one Newco which has consummated
an IPO or is no longer a majority-owned Subsidiary of CSI
regarding the following is not required to be negotiated
or arbitrated prior to seeking injunctive relief from a
court of competent jurisdiction to prevent serious and
irreparable injury to one of the parties or to others:
breach of any obligation of confidentiality; infringement,
misappropriation, or misuse of any intellectual property
right; or any other claim where interim relief from the
court is sought to prevent serious and irreparable injury
to one of the parties or to others. However, the parties
to the Dispute shall make a good faith effort to negotiate
such Dispute, according to the above procedures, while
such court action is pending.
4.10.3. The processes set forth in this Section 4.10 shall be the
exclusive processes for the resolution of a Dispute among
the parties.
4.10.4. Unless otherwise agreed in writing, the parties will
continue to honor all other commitments under this
Agreement and each Ancillary Agreement during the course of
dispute resolution
-14-
<PAGE>
pursuant to the provisions of this Section 4.10 with
respect to all matters not subject to such dispute,
controversy or claim.
4.11. Non-Solicitation of Employees. Each party (the "Recruiting Party")
----------------------------- ----------------
agrees not to solicit or recruit the employees of any other party
for a period of (i) two years following the Transformation Date or
(ii) if both the Recruiting Party and the other party are Newcos,
for a period of the longer of (x) two years from the Transformation
Date and (y) until one such party ceases to be a majority owned
subsidiary of CSI. Notwithstanding the foregoing, this prohibition
on solicitation and recruitment does not apply to actions taken by a
party as a result of an employee's affirmative response to a general
recruitment effort carried out through a public solicitation or
general solicitation.
4.12. Intentionally Omitted.
---------------------
4.13. CSI as Stockholder. The parties acknowledge that nothing contained
------------------
in this Agreement or in the Ancillary Agreements or in any
agreements contemplated hereby or thereby is intended to interfere,
or shall interfere, with CSI's rights as a stockholder of any Newco.
4.14. Public Announcements. Each Newco agrees not to issue any press
--------------------
release or make any such public statement with respect to this
Agreement or the transactions contemplated hereby without consulting
with, and obtaining the prior written approval of, CSI.
4.15. Further Assurances. Each party agrees to take such further action
------------------
and execute, deliver and/or file such documents or instruments as
are necessary to carry out the terms and purposes of this Agreement.
4.16. Conflicting Agreements. In the event of conflict between this
----------------------
Agreement and any Ancillary Agreement or other agreement executed in
connection herewith, the provisions of this Agreement shall prevail.
5. ALLOCATION OF ASSETS AND LIABILITIES
At the Closing, assets shall be contributed to the Newcos and Liabilities shall
be assumed by the Newcos as provided in the Contribution Agreements; provided,
however, that the parties acknowledge and agree that, notwithstanding any
provisions in the Contribution Agreements to the contrary, CSI may in its sole
discretion retain, allocate or reallocate to any Newcos assets and Liabilities,
including general corporate Liabilities of CSI, or terminate this Agreement or
any Ancillary Agreement to facilitate a tax-free Distribution of any Newco,
comply with regulatory or financial reporting requirements or otherwise
facilitate the Transformation in a manner consistent with its business purposes.
6. INDEMNIFICATION MATTERS
-15-
<PAGE>
This Section 6 applies to (i) this Agreement and any instruments delivered
pursuant hereto other than (A) the Ancillary Agreements, (B) any supplements to
the Intercompany Agreements and (C) the License Agreements and (ii) the
Contribution Agreements and any instruments delivered thereunder (collectively
such documents referred to in clause (i) and (ii) being referred to herein as
the "Covered Agreements").
------------------
6.1 Survival of Representations and Warranties. All covenants, agreements
------------------------------------------
and indemnities of the parties contained herein or in the Covered
Agreements shall survive the Transformation Date except as otherwise
provided herein or therein.
6.2 Indemnity by CSI. CSI hereby agrees to indemnify, defend and hold
----------------
harmless each Newco and its respective directors, officers and
Subsidiaries against and in respect of all Losses that result from:
6.2.1 any failure of the parties to comply with any bulk transfer
law of any jurisdiction in connection with the
Transformation; and
6.2.2 the conduct of CSI's business after the Transformation Date
that does not relate to any Newco's business;
provided, however, that this Section 6.2 does not apply to any Losses
related to income taxes and payroll taxes (which such Losses are
governed by the Tax Sharing Agreement). Any Newco claiming
indemnification under this Section 6.2 shall provide CSI written
notice of such claim, whether or not arising out of a claim by a third
party.
6.3 Indemnity by each Newco. Each Newco hereby agrees to indemnify, defend
-----------------------
and hold harmless (i) CSI and its directors, officers and affiliates
(other than the other Newcos and their respective Subsidiaries) and
(ii) each other Newco and its directors, officers and Subsidiaries
against and in respect of all Losses that result from:
6.3.1 the Assumed Liabilities of such Newco assumed by it pursuant
to the relevant Contribution Agreement, any other
Liabilities allocated to such Newco pursuant to Section 5
hereof, and any Liabilities arising out of the operations of
such Newco;
6.3.2 the nonfulfillment of any agreement or covenant of such
Newco contained in any Covered Agreement; and
6.3.3 the conduct of such Newco's business after the
Transformation Date.
-16-
<PAGE>
provided, however, that this Section 6.3 does not apply to any Losses
related to income taxes and payroll taxes (which such Losses are
governed by the Tax Sharing Agreement). CSI or any Newco claiming
indemnification under this Section 6.3 shall provide written notice to
the indemnifying party in respect of such claim, whether or not
arising out of a claim by a third party.
6.4 Third Party Claims. Promptly after the receipt by any party entitled
------------------
to indemnification (the "Indemnified Party") pursuant to this Section
-----------------
6 or notice of the commencement of any action against such Indemnified
Party by a third party, such Indemnified Party shall, if a claim with
respect thereto is to be made against any party obligated to provide
indemnification (the "Indemnifying Party") pursuant to this Section 6,
------------------
give such Indemnifying Party written notice thereof in reasonable
detail in light of the circumstances then known to such Indemnified
Party. The failure to give such notice shall not relieve any
Indemnifying Party from any obligation hereunder except where, and
then solely to the extent that, such failure actually and materially
prejudices the rights of such Indemnifying Party. Such Indemnifying
Party shall have the right to defend such claim, at such Indemnifying
Party's expense and with counsel of its choice reasonably satisfactory
to the Indemnified Party, provided that the Indemnifying Party
conducts the defense of such claim actively and diligently. If the
Indemnifying Party assumes the defense of such claim, the Indemnified
Party agrees to reasonably cooperate in such defense so long as the
Indemnified Party is not materially prejudiced thereby. So long as the
Indemnifying Party is conducting the defense of such claim actively
and diligently, the Indemnified Party may retain separate co-counsel
at its sole cost and expense and may participate in the defense of
such claim, and neither any Indemnifying Party nor any Indemnified
Party will consent to the entry of any judgment or enter into any
settlement with respect to such claim without the prior written
consent of the other, which consent will not be unreasonably withheld.
In the event the Indemnifying Party does not or ceases to conduct the
defense of such claim actively and diligently, (w) the Indemnified
Party may defend against such claim in any manner it may reasonably
deem to be appropriate, (x) upon receiving the prior written consent
of the Indemnifying Party, which consent will not be unreasonably
withheld, the Indemnified Party may consent to the entry of any
judgment or enter into any settlement with respect to such claim, (y)
the Indemnifying Party will reimburse the Indemnified Party promptly
and periodically for the costs of defending against such claim,
including reasonable attorneys' fees and expenses, and (z) the
Indemnifying Party will remain responsible for any Losses the
Indemnitee may suffer as a result of such claim to the full extent
provided in this Section 6.
7. CONDITIONS TO THE TRANSFORMATION
-17-
<PAGE>
The consummation of the Transformation is subject to the satisfaction, at or
prior to the Closing, of all of the following conditions:
7.1. Shareholder Approval. The shareholders of CSI shall have approved the
--------------------
Transformation.
7.2. Execution and Delivery of Documents. Unless otherwise waived in
-----------------------------------
writing by the relevant parties benefiting therefrom, each of the
parties shall have executed and delivered all Ancillary Agreements and
other documents to be executed and delivered by it on or prior to the
Transformation Date, including without limitation (i) such documents
to be executed and delivered on the Signing Date and (ii) such
documents to be executed and delivered on or prior to the
Transformation Date pursuant to Section 4.1.
7.3. Litigation. No material action shall have been instituted at or prior
----------
to the Closing by any Governmental Authority or other Person relating
to this Agreement or any of the transactions contemplated hereby,
which has a reasonable likelihood of success and the result of which
would prevent or make illegal the consummation of any such
transaction.
8. DEFINITIONS
For the purposes of this Agreement, the following terms shall have the following
meanings:
8.1. "AAA" has the meaning assigned to such term in Section 4.10.2.
---
8.2. "A-E Intercompany Agreement" has the meaning assigned to such term in
--------------------------
Section 1.5.
8.3. "A-G Intercompany Agreement" has the meaning assigned to such term in
--------------------------
Section 1.6.
8.4. "A-R Intercompany Agreement" has the meaning assigned to such term in
--------------------------
Section 1.7.
8.5. "Agreement" has the meaning assigned to such term in the preamble.
---------
8.6. "Ancillary Agreements" has the meaning assigned to such term in
--------------------
Section 1.
8.7. "Aprisma" has the meaning assigned to such term in the Preamble.
-------
-18-
<PAGE>
8.8. "Aprisma Business" means the "Company Business" as such term is
----------------
defined in the Aprisma Contribution Agreement.
8.9. "Aprisma Contribution Agreement" has the meaning assigned to such
------------------------------
term in Section 1.1.
8.10. "Assumed Liabilities" means, with respect to a particular Newco,
-------------------
"Assumed Liabilities" as such term is defined in the Contribution
Agreement to which such Newco is party.
8.11. "CSI" has the meaning assigned to such term in the preamble.
---
8.12. "CSI Confidentiality Agreement" has the meaning assigned to such term
-----------------------------
in Section 4.5.
8.13. "Closing" has the meaning assigned to such term in Section 2.3.
-------
8.14. "Commission" means the Securities and Exchange Commission.
----------
8.15. "Confidential Information" has the meaning assigned to such term in
------------------------
Section 4.4.
8.16. "Contribution Agreements" has the meaning assigned to such term in
-----------------------
Section 1.4.
8.17. "Covered Agreements" has the meaning assigned to such term in Section
------------------
6.
8.18. "Dispute" has the meaning assigned to such term in Section 4.10.1.
-------
8.19. "Dispute Resolution Commencement Date" has the meaning assigned to
------------------------------------
such term in Section 4.10.1.
8.20. "Distributed Newco" has the meaning assigned to such term in Section
-----------------
4.8.
8.21. "Distribution" has the meaning assigned to such term in the recitals.
------------
8.22. "Eligible CSI Option" has the meaning assigned to such term in
-------------------
Section 4.8.
8.23. "Enterasys" has the meaning assigned to such term in the preamble.
---------
8.24. "Enterasys Business" means the "Company Business" as such term is
------------------
defined in the Enterasys Contribution Agreement.
-19-
<PAGE>
8.25. "Enterasys Contribution Agreement" has the meaning assigned to such
--------------------------------
term in Section 1.2.
8.26. "E-G Intercompany Agreement" has the meaning assigned to such term
--------------------------
in Section 1.8.
8.27. "E-R Intercompany Agreement" has the meaning assigned to such term
--------------------------
in Section 1.9.
8.28. "Exchange Act" means the Securities and Exchange Act of 1934, as
------------
amended.
8.29. "GNTS" has the meaning assigned to such term in the preamble.
----
8.30. "GNTS Business" means the "Company Business" as such term is defined
-------------
in the GNTS Contribution Agreement.
8.31. "GNTS Contribution Agreement" has the meaning assigned to such term
---------------------------
in Section 1.3.
8.32. "Governmental Authority" means any domestic or foreign federal,
----------------------
state or local government, regulatory or administrative agency or
court.
8.33. "G-R Intercompany Agreement" has the meaning assigned to such term
--------------------------
in Section 1.10.
8.34. "Included Newco" has the meaning assigned to such term in Section
--------------
4.3.
8.35. "Indemnified Party" has the meaning assigned to such term in Section
-----------------
6.4.1.
8.36. "Indemnifying Party" has the meaning assigned to such term in
------------------
Section 6.4.1.
8.37. "Information" means information, whether or not patentable or
-----------
copyrightable, in written, oral, electronic or other tangible or
intangible forms, stored in any medium, including studies, reports,
records, books, contracts, instruments, surveys, discoveries, ideas,
concepts, know-how, techniques, designs, specifications, drawings,
blueprints, diagrams, models, prototypes, samples, flow charts,
data, computer data, disks, diskettes, tapes, computer programs or
other software, marketing plans, customer names, communications by
or to attorneys (including attorney-client privileged
communications), memos and other materials prepared by attorneys or
under their direction (including attorney work product), and other
technical, financial, employee or business information or data.
-20-
<PAGE>
8.38. "Intercompany Agreements" means, collectively, the A-E Intercompany
-----------------------
Agreement, A-G Intercompany Agreement, A-R Intercompany Agreement,
E-G Intercompany Agreement, E-R Intercompany Agreement and the G-R
Intercompany Agreement.
8.39. "IPO" has the meaning assigned to such term in the recitals.
---
8.40. "Liability" means any debt, liability or obligation whether known or
---------
unknown, whether asserted or unasserted, whether absolute or
contingent, whether accrued or unaccrued, whether liquidated or
unliquidated, whether incurred directly or consequential and whether
due or to become due, including, without limitation, any liability
arising out of applicable statutory, regulatory or common law, any
contractual obligation and any obligation arising out of tort.
8.41. "License Agreements" has the meaning assigned to such term in
------------------
Section 4.1.3.
8.42. "Losses" means obligations, judgments, liens, injunctions, charges,
------
orders, decrees, rulings, damages, dues, assessments, losses, fines,
penalties, expenses, fees, costs, amounts paid in settlement
(including reasonable attorneys' and expert witness fees and
disbursements in connection with the investigation, defense or
settlement of any action or threatened action), arising out of any
claim, damages, complaint, demand, cause of action, audit,
investigation, hearing, action, suit or other proceeding asserted or
initiated or otherwise existing in respect of any matter.
8.43. "Manufactured Products Agreement" has the meaning assigned to such
-------------------------------
term in Section 1.12.
8.44. "Newco Confidentiality Agreement" has the meaning assigned to such
-------------------------------
term in Section 4.5.
8.45. "Newco Stock" has the meaning assigned to such term in Section 4.8.
-----------
8.46. "Newcos" has the meaning assigned to such term in the preamble.
------
8.47. "Person" means an individual, a partnership, a corporation, a
------
limited liability company, an association, a joint stock company, a
trust, a joint venture, an unincorporated organization and a
governmental entity or any department, agency or political
subdivision thereof.
8.48. "Rainbow Option" has the meaning assigned to such term in Section
--------------
4.8.
8.49. "Recipient" has the meaning assigned to such term in Section 4.8.
---------
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<PAGE>
8.50. "Recruiting Party" has the meaning assigned to such term in Section
----------------
4.11.
8.51. "Retained Third Party Tool Rights" has the meaning assigned to such
--------------------------------
term in Section 4.1.2.
8.52. "Riverstone" has the meaning assigned to such term in the preamble.
----------
8.53. "Riverstone Business" means the "Company Business" as such term is
-------------------
defined in the Riverstone Contribution Agreement.
8.54. "Riverstone Contribution Agreement" has the meaning assigned to such
---------------------------------
term in Section 1.4.
8.55. "Securities Act" means the Securities Act of 1933, as amended.
--------------
8.56. "Shared Services Agreements" has the meaning assigned to such term
--------------------------
in Section 4.1.4.
8.57. "Signing Date" has the meaning assigned to such term in the
------------
preamble.
8.58. "Subsidiary" of any Person means a corporation or other organization
----------
whether incorporated or unincorporated of which at least a majority
of the securities or interests having by the terms thereof ordinary
voting power to elect at least a majority of the board of directors
or others performing similar functions with respect to such
corporation or other organization is directly or indirectly owned or
controlled by such Person or by any one or more of its Subsidiaries,
or by such Person and one or more of its Subsidiaries; provided,
however, that no Person that is not directly or indirectly wholly-
owned by any other Person shall be a Subsidiary of such other Person
unless such other Person controls, or has the right, power or
ability to control, that Person.
8.59. "Tax Sharing Agreement" has the meaning assigned to such term in
---------------------
Section 1.11.
8.60. "Third Party Claim" has the meaning assigned to such term in Section
-----------------
6.4.1.
8.61. "Transformation" has the meaning assigned to such term in the
--------------
recitals.
8.62. "Transformation Date" has the meaning assigned to such term in
-------------------
Section 2.2.
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<PAGE>
9. MISCELLANEOUS
9.1. Entire Agreement. This Agreement and the Ancillary Agreements
----------------
including the schedules and exhibits hereto and thereto and the other
documents and instruments delivered pursuant hereto and thereto
constitute the entire agreement among the parties hereto pertaining to
the subject matter hereof and supersede all prior or contemporaneous
agreements, understandings, negotiations and discussions, whether oral
or written, of the parties with respect to such subject matter.
9.2. Amendment or Waiver. Except as provided in Section 9.10 and this
-------------------
Section 9.2, the parties hereto may not amend this Agreement except by
a written instrument executed by the parties hereto. CSI and any one
Newco, without the consent of any other Newco, may amend this
Agreement in a manner which does not adversely affect any other Newco
pursuant to a written instrument executed by CSI and such Newco. Any
party may waive its rights hereunder by a written instrument executed
by such party; provided, however, that unless explicitly provided in
such instrument, any waiver by any party of any default,
misrepresentation, or breach of warranty or covenant hereunder shall
not be deemed to extend to any prior or subsequent default,
misrepresentation, or breach of warranty or covenant hereunder.
9.3. Severability. In the event that any provision hereof would, under
------------
applicable law, be invalid or unenforceable in any respect, such
provision shall (to the extent permitted under applicable law) be
construed by modifying or limiting it so as to be valid and
enforceable to the maximum extent compatible with, and possible under,
applicable law. The provisions hereof are severable, and in the event
any provision hereof should be held invalid or unenforceable in any
respect, it shall not invalidate, render unenforceable or otherwise
affect any other provision hereof.
9.4. Successors and Assigns. All of the terms and provisions of this
----------------------
Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective permitted transferees and assigns
(each of which transferees and assigns shall be deemed to be a party
hereto for all purposes hereof); provided, however, that (i) no
-------- -------
transfer or assignment by any party hereto shall be permitted without
the prior written consent of the other party hereto and any such
attempted transfer or assignment without consent shall be null and
void and (ii) no transfer or assignment by any party shall relieve
such party of any of its obligations hereunder.
9.5. Notices. Any notices or other communications required or permitted
-------
hereunder shall be sufficiently given if in writing and delivered
personally
-23-
<PAGE>
or sent by telecopier, Federal Express, or registered or certified
mail, postage prepaid, addressed as follows:
If to CSI,
to it at: Cabletron Systems, Inc.
35 Industrial Way
Building 36
Rochester, NH 03867
Attention: Eric Jaeger and Chief Financial Officer
Telecopier No.: (603) 337-1518
with a copy to: Ropes & Gray
One International Place
Boston, MA 02110
Attention: David A. Fine
Telecopier No.: (617) 951-7050
If to Aprisma,
to it at: Aprisma Management Technologies, Inc.
121 Technology Drive
Durham, NH 03824
Attention: President
Telecopier No.: (603) 337-7784
with a copy to: Ropes & Gray
One International Place
Boston, MA 02110
Attention: David A. Fine
Telecopier No.: (617) 951-7050
If to Enterasys,
to it at: Enterasys Networks, Inc.
35 Industrial Way
Building 36
Rochester, NH 03867
Attention: President
Telecopier No.: (603) 337-1524
a copy to: Ropes & Gray
One International Place
Boston, MA 02110
Attention: David A. Fine
Telecopier No.: (617) 951-7050
If to GNTS,
-24-
<PAGE>
to it at: GlobalNetwork Technology Services, Inc.
35 Industrial Way
Building 28
Rochester, NH 03867
Attention: President
Telecopier No.: (603) 337-3402
with a copy to: Ropes & Gray
One International Place
Boston, MA 02110
Attention: David A. Fine
Telecopier No.: (617) 951-7050
If to Riverstone,
to it at: Riverstone Networks, Inc.
5200 Great America Parkway
Santa Clara, CA
Attention: President
Telecopier No.: (408) 878-6501
with a copy to: Ropes & Gray
One International Place
Boston, MA 02110
Attention: David A. Fine
Telecopier No.: (617) 951-7050
Unless otherwise specified herein, such notices or other
communications shall be deemed received (a) on the date delivered, if
delivered personally, (b) two Business Days after being sent by
Federal Express, if sent by Federal Express, (c) one Business Day
after being delivered, if delivered by telecopier and (d) three
Business Days after being sent, if sent by registered or certified
mail. Each of the parties hereto shall be entitled to specify a
different address by giving notice as aforesaid to each of the other
parties hereto.
9.6. Interpretation. Section and subsection headings are not to be
--------------
considered part of this Agreement, are included solely for
convenience, are not intended to be full or accurate descriptions of
the content thereof and shall not affect the construction hereof. No
rule of strict construction shall apply to or be used against any
party hereto.
9.7. Third Party Beneficiaries. Nothing in this Agreement is intended or
-------------------------
shall be construed to entitle any person or entity other than the
parties and their respective transferees and assigns permitted hereby
to any claim, cause of action, remedy or right of any kind.
-25-
<PAGE>
9.8. Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be deemed an original, but all of
which together shall constitute but one and the same instrument.
9.9. Governing Law. This Agreement shall be governed by and construed in
-------------
accordance with the domestic substantive laws of the State of
Delaware, without giving effect to any choice or conflict of law
provision or rule that would cause the application of the laws of any
other jurisdiction.
10. Termination. This Agreement and any Ancillary Agreements and agreements
-----------
delivered pursuant hereto and thereto may be terminated with respect to any
one or more or all Newcos and/or the Transformation abandoned at any time
prior to the Closing by and in the sole discretion of CSI without the
approval of any Newco. In the event of termination pursuant to this
Section 10, no party shall have any liability of any kind to the other
relevant party or parties to the extent of such termination.
-26-
<PAGE>
IN WITNESS WHEREOF, the undersigned have executed this instrument under seal
as of the date first written above.
CABLETRON SYSTEMS, INC.
By: /s/ Piyush Patel
--------------------------------
Name: Piyush Patel
Title: President, Chairman & CEO
APRISMA MANAGEMENT TECHNOLOGIES, INC.
By: ________________________________
Name:
Title:
ENTERASYS NETWORKS, INC.
By: ________________________________
Name:
Title:
GLOBALNETWORK TECHNOLOGY SERVICES, INC.
By: ________________________________
Name:
Title:
RIVERSTONE NETWORKS, INC.
By: ________________________________
Name:
Title:
<PAGE>
IN WITNESS WHEREOF, the undersigned have executed this instrument under seal
as of the date first written above.
CABLETRON SYSTEMS, INC.
By: ________________________________
Name:
Title:
APRISMA MANAGEMENT TECHNOLOGIES, INC.
By: /s/ Michael Skubisz
--------------------------------
Name: Michael Skubisz
Title: President
ENTERASYS NETWORKS, INC.
By: ________________________________
Name:
Title:
GLOBALNETWORK TECHNOLOGY SERVICES, INC.
By: ________________________________
Name:
Title:
RIVERSTONE NETWORKS, INC.
By: ________________________________
Name:
Title:
<PAGE>
IN WITNESS WHEREOF, the undersigned have executed this instrument under seal
as of the date first written above.
CABLETRON SYSTEMS, INC.
By: ________________________________
Name:
Title:
APRISMA MANAGEMENT
TECHNOLOGIES, INC.
By: ________________________________
Name:
Title:
ENTERASYS NETWORKS, INC.
By: /s/ Enrique P. Fiallo
--------------------------------
Name: Enrique P. Fiallo
Title: President
GLOBALNETWORK TECHNOLOGY
SERVICES, INC.
By: ________________________________
Name:
Title:
RIVERSTONE NETWORKS, INC.
By: ________________________________
Name:
Title:
<PAGE>
IN WITNESS WHEREOF, the undersigned have executed this instrument under seal
as of the date first written above.
CABLETRON SYSTEMS, INC.
By: ________________________________
Name:
Title:
APRISMA MANAGEMENT
TECHNOLOGIES, INC.
By: ________________________________
Name:
Title:
ENTERASYS NETWORKS, INC.
By: ________________________________
Name:
Title:
GLOBALNETWORK TECHNOLOGY
SERVICES, INC.
By: /s/ Earle Humphreys
--------------------------------
Name: EARLE HUMPHREYS
Title: CEO
RIVERSTONE NETWORKS, INC.
By: /s/ Romulus Pereira
--------------------------------
Name: ROMULUS PEREIRA
Title: PRESIDENT
