EXHIBIT 99.d
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EMPLOYEE MATTERS AGREEMENT
by and among
CONEXANT SYSTEMS, INC.,
WASHINGTON SUB, INC.
and
ALPHA INDUSTRIES, INC.
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[______________], 2002
TABLE OF CONTENTS
PAGE
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ARTICLE I DEFINITIONS.......................................... 2
Section 1.01 General............................................... 2
ARTICLE II EMPLOYEES............................................ 6
Section 2.01 Employees............................................ 6
ARTICLE III SAVINGS PLANS........................................ 7
Section 3.01 Retirement Savings Plan.............................. 7
Section 3.02 Hourly Employees' Savings Plan....................... 7
Section 3.03 Non-Qualified Retirement Savings Plan................ 8
ARTICLE IV PENSION PLANS........................................ 8
Section 4.01 Hourly Employees Retirement Plan..................... 8
ARTICLE V STOCK PLANS.......................................... 9
Section 5.01 Stock Plans.......................................... 9
ARTICLE VI OTHER EMPLOYEE PLANS AND MATTERS..................... 10
Section 6.01 Welfare Plans........................................ 10
Section 6.02 Incentive Compensation Plans......................... 12
Section 6.03 Deferred Compensation Plans.......................... 13
Section 6.04 Severance Pay........................................ 14
Section 6.05 Employment, Consulting and Other Employee
Related Agreements.................................. 15
Section 6.06 Employee Stock Purchase Plans........................ 15
Section 6.07 VERP................................................. 16
Section 6.08 Other Liabilities.................................... 17
ARTICLE VII MISCELLANEOUS........................................ 17
Section 7.01 Indemnification...................................... 17
Section 7.02 Sharing of Information............................... 18
Section 7.03 Entire Agreement; Construction....................... 18
Section 7.04 Survival of Agreements............................... 18
Section 7.05 Governing Law........................................ 18
Section 7.06 Notices.............................................. 18
Section 7.07 Amendments........................................... 19
Section 7.08 Assignment........................................... 19
Section 7.09 Captions; Currency................................... 19
Section 7.10 Severability......................................... 19
Section 7.11 Parties in Interest.................................. 19
Section 7.12 Schedules............................................ 20
Section 7.13 Change of Name....................................... 20
Section 7.14 Waivers; Remedies.................................... 20
Section 7.15 Counterparts......................................... 20
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Section 7.16 Performance.......................................... 20
Section 7.17 Dispute Resolution................................... 20
Section 7.18 Cooperation.......................................... 21
Section 7.19 Interpretation....................................... 21
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SCHEDULE 5.01(d)
EMPLOYEE MATTERS AGREEMENT
EMPLOYEE MATTERS AGREEMENT (this "AGREEMENT") dated as of
___, 2002 by and among CONEXANT SYSTEMS, INC., a Delaware corporation
("CONEXANT"), WASHINGTON SUB, INC., a Delaware corporation and a wholly-owned
subsidiary of Conexant ("WASHINGTON"), and ALPHA INDUSTRIES, INC., a Delaware
corporation ("ALPHA").
WHEREAS, Conexant, Washington and Alpha have entered into an
Agreement and Plan of Reorganization dated as of December 16, 2001 (the "MERGER
AGREEMENT") providing for, among other things, the merger of Washington with and
into Alpha, with Alpha being the surviving corporation;
WHEREAS, Conexant and Washington also have entered into a
Contribution and Distribution Agreement dated as of December 16, 2001 (the
"DISTRIBUTION AGREEMENT"), pursuant to which (a) all the Washington Assets (as
defined in the Distribution Agreement) will be contributed to Washington and/or
to one or more of the Washington Subsidiaries (as defined in the Distribution
Agreement) and all of the Washington Liabilities (as defined in the Distribution
Agreement) will be assumed by Washington and/or by one or more of the Washington
Subsidiaries, all as provided in the Distribution Agreement (the "CONTRIBUTION")
and (b) all of the issued and outstanding shares of Common Stock, par value $.01
per share, of Washington ("WASHINGTON COMMON STOCK") will be distributed on a
pro rata basis to Conexant's stockholders as provided in the Distribution
Agreement (the "DISTRIBUTION");
WHEREAS, the execution and delivery of this Agreement by the
parties hereto is a condition to the obligations of the parties to the Merger
Agreement to consummate the Merger (as defined in the Merger Agreement);
WHEREAS, the execution and delivery of this Agreement by the
parties hereto is a condition to the obligations of the parties to the
Distribution Agreement to consummate the Distribution; and
WHEREAS, in connection with the Contribution and the
Distribution, Conexant and Washington have determined that it is appropriate and
desirable to provide for the allocation of certain assets and liabilities and
certain other matters relating to employees, employee benefit plans and
compensation arrangements;
NOW, THEREFORE, in consideration of the premises and of the
respective agreements and covenants contained in this Agreement, the parties
hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 GENERAL. Capitalized terms used in this Agreement
(or in any Schedule to this Agreement) but not defined herein (other than the
names of employee benefit plans) will have the meanings ascribed to such terms
in the Distribution Agreement. As used in this Agreement (or in any Schedule to
this Agreement), the terms defined in Schedule 1.01 have the meanings set forth
in Schedule 1.01 and the following terms have the following meanings (in each
case, such meanings to be equally applicable to both the singular and plural
forms of the terms defined):
"ACTIVE CONEXANT EMPLOYEE" means any individual who,
immediately after the Time of Distribution, will be employed by a
member of the Conexant Group pursuant to Section 2.01(b).
"ACTIVE WASHINGTON EMPLOYEE" means any individual who,
immediately after the Time of Distribution, will be employed by a
member of the Washington Group pursuant to Section 2.01(a).
"AGREEMENT" has the meaning set forth in the preamble.
"ALPHA" has the meaning set forth in the preamble.
"CODE" means the Internal Revenue Code of 1986, as amended, or
any successor legislation.
"CONEXANT" has the meaning set forth in the preamble.
"CONEXANT DEFERRED COMPENSATION PLAN" means the Conexant
Systems, Inc. Deferred Compensation Plan, including all amendments
thereto through the Distribution Date.
"CONEXANT DEFERRED COMPENSATION PLAN RABBI TRUST" means the
Conexant Systems, Inc. master rabbi trust relating to the Conexant
Deferred Compensation Plan, including all amendments thereto through
the Distribution Date.
"CONEXANT 1999 ESPP" means the Conexant Systems, Inc. 1999
Employee Stock Purchase Plan, including all amendments thereto through
the Distribution Date, under which no Offering Periods (as defined in
the plan) are currently outstanding.
"CONEXANT 2001 ESPP" means the Conexant Systems, Inc. 2001
Employee Stock Purchase Plan, including all amendments thereto through
the Distribution Date.
"CONEXANT HOURLY RETIREMENT PLAN" means the Conexant Systems,
Inc. Retirement Plan for Hourly Employees, including all amendments
thereto through the Distribution Date.
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"CONEXANT HOURLY SAVINGS PLAN" means the Conexant Systems,
Inc. Hourly Employees' Savings Plan, including all amendments thereto
through the Distribution Date.
"CONEXANT NON-QUALIFIED ESPP" means the Conexant Systems, Inc.
Non-Qualified Employee Stock Purchase Plan, including all amendments
thereto through the Distribution Date.
"CONEXANT NON-QUALIFIED SAVINGS PLAN" means the Conexant
Systems, Inc. Non-Qualified Retirement Savings Plan, including all
amendments thereto through the Distribution Date.
"CONEXANT OPTION" means an option to purchase from Conexant
shares of Conexant Common Stock granted pursuant to or governed by one
of the Conexant Stock Plans which is outstanding immediately prior to
the Time of Distribution.
"CONEXANT PARTICIPANT" means any individual who, immediately
after the Time of Distribution, is (a) an Active Conexant Employee, (b)
a Former Conexant Employee or (c) a beneficiary of either of the
foregoing.
"CONEXANT SAVINGS PLAN" means the Conexant Systems, Inc.
Retirement Savings Plan, including all amendments thereto through the
Distribution Date.
"CONEXANT SPLIT OPTION" means each Conexant Option (other than
the Mindspeed March 30 Options).
"CONEXANT STOCK PLANS" means each of the following plans:
(i) Conexant Systems, Inc. 1998 Stock Option Plan;
(ii) Conexant Systems, Inc. 1999 Long-Term
Incentives Plan;
(iii) Conexant Systems, Inc. 2000 Non-Qualified
Stock Plan;
(iv) Conexant Systems, Inc. Directors Stock Plan;
(v) Istari Design, Inc. 1997 Stock Option Plan;
(vi) Microcosm Communications Limited Stock Option
Plan;
(vii) Maker Communications, Inc. 1999 Stock
Incentive Plan;
(viii) Maker Communications, Inc. 1996 Stock Option
Plan;
(ix) Applied Telecom, Inc. 2000 Non-Qualified Stock
Option Plan;
(x) Philsar Semiconductor Inc. Stock Option Plan;
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(xi) Sierra Imaging, Inc. 1996 Stock Option Plan;
(xii) HotRail, Inc. 1997 Equity Incentive Plan;
(xiii) HotRail, Inc. 2000 Equity Plan;
(xiv) NetPlane Systems, Inc. Stock Option Plan;
(xv) Novanet Semiconductor Ltd. Employee Shares
Option Plan;
and
(xvi) HyperXS Communications, Inc. 2000 Stock
Option Plan;
in each case, including all amendments thereto through the Distribution Date.
"CONEXANT VERP" means the Conexant Systems, Inc. Voluntary
Early Retirement Program, including all amendments thereto through the
Distribution Date.
"CONEXANT VERP TRUST" means the Conexant Systems, Inc. trust
relating to the Conexant VERP, including all amendments thereto
through the Distribution Date.
"CONEXANT WELFARE PLANS" has the meaning set forth in Section
6.01(a).
"CONTRIBUTION" has the meaning set forth in the recitals.
"DISTRIBUTION" has the meaning set forth in the recitals.
"DISTRIBUTION AGREEMENT" has the meaning set forth in the
recitals.
"EFFECTIVE TIME" has the meaning set forth in the Merger
Agreement.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, or any successor legislation.
"FORMER CONEXANT EMPLOYEE" means any Pre-Distribution Group
Employee who is not, immediately after the Time of Distribution, an
Active Conexant Employee or an Active Washington Employee, and whose
most recent active employment with Conexant or any other member of the
Pre-Distribution Group (but with respect to each such member who has
ceased to be an Affiliate of Conexant or its predecessors, prior to the
time that such member of the Pre-Distribution Group ceased to be an
Affiliate of Conexant or its predecessors) was with the Conexant
Business.
"FORMER WASHINGTON EMPLOYEE" means any Pre-Distribution Group
Employee who is not, immediately after the Time of Distribution, an
Active Washington Employee or an Active Conexant Employee, and whose
most recent active employment with Conexant or any other member of the
Pre-Distribution Group (but with respect to each such member who has
ceased to be an Affiliate of Conexant or its predecessors, prior to the
time that such member of the Pre-Distribution Group
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ceased to be an Affiliate of Conexant or its predecessors) was with the
Washington Business or, to the extent such Pre-Distribution Group
Employee's function was primarily related to the Washington Business,
the corporate office of Conexant.
"INCENTIVE COMPENSATION PLANS" means each of the following
plans:
(i) Peak Performance Plan, Conexant's Annual
Incentive Plan;
(ii) Peak Performance Plan - Marketing, Conexant's
Annual Incentive Plan;
(iii) Conexant Systems, Inc. FY01 Sales Compensation
Plan; and
(iv) Conexant Systems, Inc. 2001 Performance Share
Plan.
"MERGER AGREEMENT" has the meaning set forth in the recitals.
"MINDSPEED MARCH 30 OPTIONS" means those Conexant Options
granted to employees of Conexant's Mindspeed Technologies business on
March 30, 2001.
"PRE-DISTRIBUTION GROUP" has the meaning set forth in the
Distribution Agreement.
"PRE-DISTRIBUTION GROUP EMPLOYEE" means any individual who
was, at any time prior to the Time of Distribution, employed by
Conexant or any other member of the Pre-Distribution Group (but with
respect to each such member who has ceased to be an Affiliate of
Conexant or its predecessors, prior to the time that such member of the
Pre-Distribution Group ceased to be an Affiliate of Conexant or its
predecessors).
"WASHINGTON" has the meaning set forth in the preamble.
"WASHINGTON COMMON STOCK" has the meaning set forth in the
recitals.
"WASHINGTON DEFERRED COMPENSATION PLAN" has the meaning set
forth in Section 6.03(a).
"WASHINGTON DEFERRED COMPENSATION PLAN RABBI TRUST" has the
meaning set forth in Section 6.03(a).
"WASHINGTON ESPP" has the meaning set forth in Section
6.06(a).
"WASHINGTON NON-QUALIFIED ESPP" has the meaning set forth in
Section 6.06(a).
"WASHINGTON NON-QUALIFIED SAVINGS PLAN" has the meaning set
forth in Section 3.03(a).
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"WASHINGTON OPTION" means an option to purchase from
Washington shares of Washington Common Stock provided to a holder of a
Conexant Split Option pursuant to Section 5.01(a).
"WASHINGTON PARTICIPANT" means any individual who, immediately
after the Time of Distribution, is (a) an Active Washington Employee,
(b) a Former Washington Employee or (c) a beneficiary of either of the
foregoing.
"WASHINGTON SAVINGS PLAN" has the meaning set forth in Section
3.01(a).
"WASHINGTON STOCK PLANS" has the meaning set forth in Section
5.01(b).
"WASHINGTON VERP" has the meaning set forth in Section
6.07(a).
"WASHINGTON VERP TRUST" has the meaning set forth in Section
6.07(a).
"WASHINGTON WELFARE PLANS" has the meaning set forth in
Section 6.01(a).
"WELFARE PLAN" means an employee welfare benefit plan as
defined in Section 3(1) of ERISA, including medical, vision, dental and
other health plans, retiree health plans, life insurance plans, retiree
life insurance plans, accidental death and dismemberment plans,
long-term disability plans and severance pay plans.
ARTICLE II
EMPLOYEES
Section 2.01 EMPLOYEES. (a) Each individual who is employed by
Conexant or any of its Subsidiaries (including members of the Washington Group
and members of the Conexant Group) immediately prior to the Time of Distribution
and who is identified on the attached Schedule 2.01 (including those individuals
identified on Schedule 2.01 who are actively employed or on lay-off, leave,
short-term or long-term disability or other permitted absence from employment)
will be or will continue to be employed by a member of the Washington Group
immediately after the Time of Distribution and will be an Active Washington
Employee.
(b) Each individual (other than those identified on Schedule
2.01) who is employed by Conexant or any of its Subsidiaries (including members
of the Washington Group and members of the Conexant Group) immediately prior to
the Time of Distribution (including those who are actively employed or on
lay-off, leave, short-term or long-term disability or other permitted absence
from employment) will be or will continue to be employed by a member of the
Conexant Group immediately after the Time of Distribution and will be an Active
Conexant Employee.
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(c) Nothing contained in this Section 2.01 is intended to
confer upon any employee of the Conexant Group or the Washington Group any right
to continued employment after the Time of Distribution.
ARTICLE III
SAVINGS PLANS
Section 3.01 RETIREMENT SAVINGS PLAN. (a) As of the Effective
Time, Washington or Alpha will have established, and will cover Active
Washington Employees who were eligible to participate in the Conexant Savings
Plan prior to the Time of Distribution under, a new or existing defined
contribution plan (the "WASHINGTON SAVINGS PLAN"), which will be qualified
pursuant to Sections 401(a) and 401(k) of the Code, and will have established a
related trust which will be exempt from taxation under Section 501(a) of the
Code. The Washington Savings Plan will credit each participating Active
Washington Employee thereunder for purposes of eligibility and vesting with all
service which had been credited to such employee for such purposes under the
Conexant Savings Plan immediately prior to the Time of Distribution.
(b) After the Time of Distribution, each Active Washington
Employee who participated in the Conexant Savings Plan prior to the Time of
Distribution will be permitted to rollover his or her account balances and any
outstanding loans related thereto from the Conexant Savings Plan to the
Washington Savings Plan in accordance with the terms of the respective plans and
applicable law.
(c) Effective as of the Time of Distribution, Active
Washington Employees will cease to be eligible to contribute to, or receive
contributions in respect of, their Conexant Savings Plan accounts. None of
Washington, any other member of the Washington Group, Affiliates of the
foregoing, the Washington Savings Plan or the trust thereunder will have or
acquire any interest in or right to any of the assets of the Conexant Savings
Plan, and Conexant will retain full power and authority with respect to the
amendment and termination of the Conexant Savings Plan and the investment and
disposition of assets held in the Conexant Savings Plan to the extent permitted
by law.
Section 3.02 HOURLY EMPLOYEES' SAVINGS PLAN. As of the Time of
Distribution, Conexant will retain sponsorship of the Conexant Hourly Savings
Plan. No Active Washington Employees are eligible to participate in the Conexant
Hourly Savings Plan. Accordingly, none of Washington or any member of the
Washington Group will have or retain any interest in or right to any of the
assets of the Conexant Hourly Savings Plan or will have any Liabilities with
respect to such plan, and Conexant will have full power and authority with
respect to the Conexant Hourly Savings Plan.
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Section 3.03 NON-QUALIFIED RETIREMENT SAVINGS PLAN.
(a) ESTABLISHMENT OF NON-QUALIFIED SAVINGS PLANS. As of the
Effective Time, Washington or Alpha will have established, and will cover the
Washington Participants set forth on Schedule 3.03 who were eligible to
participate in the Conexant Non-Qualified Savings Plan prior to the Time of
Distribution under, a new or existing non-qualified supplemental savings plan
(the "WASHINGTON NON-QUALIFIED SAVINGS PLAN"). The Washington Non-Qualified
Savings Plan will credit each participating Washington Participant thereunder
for purposes of eligibility to participate, vesting, benefit accruals and all
other plan purposes with all service which had been credited to such participant
for such purposes under the Conexant Non-Qualified Savings Plan immediately
prior to the Time of Distribution (except to the extent that such crediting
would result in the duplication of benefits). The Washington Non-Qualified
Savings Plan will have terms and conditions similar to those of the Conexant
Non-Qualified Savings Plan, except where such terms and conditions would result
in the loss of such plan's exempt status under ERISA Sections 201(2), 301(a)(3)
and 401(a)(1).
(b) ASSUMPTION OF NON-QUALIFIED SAVINGS PLAN LIABILITIES.
(i) Effective as of the Time of Distribution, Washington
hereby assumes, and agrees to fully perform, pay and discharge, and
agrees to cause the Washington Non-Qualified Savings Plan to assume,
and to fully perform, pay and discharge, all accrued benefit and other
Liabilities of Conexant or any of its Subsidiaries (including members
of the Washington Group) and of the Conexant Non-Qualified Savings Plan
under and relating to the Conexant Non-Qualified Savings Plan with
respect to Washington Participants who were covered under the Conexant
Non-Qualified Savings Plan prior to the Time of Distribution.
(ii) Effective as of the Time of Distribution, Conexant hereby
retains, and agrees to fully perform, pay and discharge, and agrees to
cause the Conexant Non-Qualified Savings Plan to retain, and to fully
perform, pay and discharge, all accrued benefit and other Liabilities
of Conexant or any of its Subsidiaries (including members of the
Washington Group) and of the Conexant Non-Qualified Savings Plan under
and relating to the Conexant Non-Qualified Savings Plan, other than
those assumed by Washington pursuant to Section 3.03(b)(i).
ARTICLE IV
PENSION PLANS
Section 4.01 HOURLY EMPLOYEES RETIREMENT PLAN. As of the Time
of Distribution, Conexant will retain sponsorship of the Conexant Hourly
Retirement Plan. No Active Washington Employees are eligible to participate in
the Conexant Hourly Retirement Plan. Accordingly, none of Washington or any
member of the Washington Group will have or retain any interest in or right to
any of the assets of the Conexant Hourly Retirement Plan
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or will have any Liabilities with respect to such plan, and Conexant will have
full power and authority with respect to the Conexant Hourly Retirement Plan.
ARTICLE V
STOCK PLANS
Section 5.01 STOCK PLANS. (a) Conexant and Washington will
take all action necessary or appropriate so that each Conexant Split Option that
is outstanding immediately prior to the Time of Distribution is adjusted
pursuant to the equitable adjustment and other provisions of the applicable
Conexant Stock Plan under which such Conexant Split Option was granted in the
manner described in this Section 5.01. The number of shares of Conexant Common
Stock subject to such adjusted Conexant Split Option and the per-share exercise
price of such adjusted Conexant Split Option will be determined as set forth on
Schedule 5.01(a)(i). Each such adjusted Conexant Split Option will otherwise
have the same terms and conditions as those in effect immediately prior to the
adjustment. In addition, each person holding a Conexant Split Option that is
outstanding immediately prior to the Time of Distribution will receive a
Washington Option pursuant to the equitable adjustment and other provisions of
the applicable Conexant Stock Plan under which such Conexant Split Option was
granted. The number of shares of Washington Common Stock subject to such
Washington Option and the per-share exercise price of such Washington Option
will be determined as set forth on Schedule 5.01(a)(ii). Each such Washington
Option will otherwise have substantially the same terms and conditions as the
corresponding Conexant Split Option being adjusted, except that references to
Conexant will be changed to refer to Washington and references to any of the
Conexant Stock Plans will be changed to refer to Washington's applicable stock
option plan.
(b) Prior to the Time of Distribution, Washington will have
established one or more stock option plans (the "WASHINGTON STOCK PLANS") the
purposes of which are to provide a means for Washington to perform its
obligations with respect to Washington Options derived from the Conexant Split
Options and which will be substantially similar in all material respects to the
corresponding Conexant Stock Plan governing the Conexant Split Option from which
the Washington Option was derived and will provide that solely for purposes of
vesting and treatment of the Washington Options upon termination of employment,
retirement, death or disability under the Washington Stock Plan, continued
employment of the holder of any Washington Option who is not an Active
Washington Employee with such holder's current employer (or an Affiliate
thereof) shall be treated as continued employment with Washington. From and
after the Time of Distribution, Washington will retain sponsorship of and will
be solely responsible for the Washington Stock Plans.
(c) The Conexant Stock Plans will provide that solely for
purposes of vesting and treatment of the Conexant Split Options upon termination
of employment, retirement, death or disability under the Conexant Stock Plans,
continued employment of any Active Washington Employee who holds a Conexant
Split Option with Washington or
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Arizona (or an Affiliate thereof) shall be treated as continued employment with
Conexant. From and after the Time of Distribution, Conexant will retain
sponsorship of and will be solely responsible for the Conexant Stock Plans.
(d) Conexant and Washington will take all action necessary or
appropriate so that each Mindspeed March 30 Option that is outstanding
immediately prior to the Time of Distribution is adjusted pursuant to the
equitable adjustment and other provisions of the applicable Conexant Stock Plan
under which such Mindspeed March 30 Option was granted in the manner described
in this Section 5.01(d). The number of shares of Conexant Common Stock subject
to such adjusted Mindspeed March 30 Option and the per-share exercise price of
such adjusted Mindspeed March 30 Option will be determined as set forth on
Schedule 5.01(d). Each such adjusted Mindspeed March 30 Option will otherwise
have the same terms and conditions as those in effect immediately prior to the
adjustment.
ARTICLE VI
OTHER EMPLOYEE PLANS AND MATTERS
Section 6.01 WELFARE PLANS. (a) Effective as of the Effective
Time, Washington or Alpha will have established, and will cover Washington
Participants under, new or existing Welfare Plans and other employee welfare
benefit and fringe benefit arrangements (collectively, "WASHINGTON WELFARE
PLANS") that are comparable in the aggregate to the Welfare Plans and other
employee welfare benefit and fringe benefit arrangements maintained by Conexant
and its Subsidiaries (including members of the Washington Group) prior to the
Time of Distribution in which Washington Participants were eligible to
participate immediately prior to the Time of Distribution ("CONEXANT WELFARE
PLANS"), with such changes or amendments thereto as Washington may deem
appropriate.
(b) The Washington Welfare Plans will provide for the
immediate participation of those Washington Participants who participated in the
corresponding Conexant Welfare Plans immediately prior to the Time of
Distribution. Each of the Washington Welfare Plans will credit each Washington
Participant thereunder for all Washington Welfare Plan purposes with all service
and any other item which had been credited to or otherwise accumulated for the
benefit of such Washington Participant under the corresponding Conexant Welfare
Plans immediately prior to the Time of Distribution, including service credited
toward any waiting periods and amounts credited toward any medical or health
insurance deductible or co-payment (except to the extent that such crediting
would result in the duplication of benefits). Without limiting the generality of
the foregoing, each Washington Welfare Plan, to the extent applicable: (i) will
recognize all amounts applied to deductibles, co-payments, out-of-pocket
maximums and lifetime maximum benefits with respect to Washington Participants
under the corresponding Conexant Welfare Plan for the plan year that includes
the Time of Distribution and for prior periods (if applicable); (ii) will
recognize all service credited to waiting periods with respect to Washington
Participants under the corresponding Conexant Welfare Plan; (iii) will not
impose any limitations on coverage of pre-existing conditions of Washington
Participants, except to the
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extent such limitations applied to such Washington Participants under the
corresponding Conexant Welfare Plan immediately prior to the Time of
Distribution; and (iv) will not impose any other conditions (such as proof of
good health, evidence of insurability or a requirement of a physical
examination) upon the participation by Washington Participants who were
participating in the corresponding Conexant Welfare Plan immediately prior to
the Time of Distribution.
(c) Effective as of the Effective Time, Washington or Alpha
will have established, and will cover Active Washington Employees under,
policies relating to vacation days and personal and sick days that are
comparable in the aggregate to the policies relating to vacation days and
personal and sick days maintained by Conexant immediately prior to the Time of
Distribution. Effective as of the Time of Distribution, Washington and the
Washington Subsidiaries will credit each Active Washington Employee with the
unused vacation days and personal and sickness days accrued by such employee
through the Time of Distribution in accordance with the vacation and personnel
policies and agreements of Conexant and its Subsidiaries (including members of
the Washington Group) applicable to such employee in effect immediately prior to
the Time of Distribution.
(d) From and after the Time of Distribution, Washington and
the Washington Subsidiaries hereby assume or retain, as applicable, and will be
solely responsible for and will fully perform, pay and discharge, all
Liabilities of Conexant or any of its Subsidiaries (including members of the
Washington Group) in respect of Washington Participants (and claims by or
relating to Washington Participants) with respect to employee welfare and fringe
benefits (including medical, dental, vision, life, travel, accident, short- and
long-term disability, hospitalization, workers' compensation and other insurance
benefits), whether under the Conexant Welfare Plans, the Washington Welfare
Plans or otherwise, whether incurred, or arising in connection with incidents
occurring, before, at or after the Time of Distribution and whether any claim is
made with respect thereto before, at or after the Time of Distribution.
Notwithstanding the preceding sentence, Washington and the Washington
Subsidiaries will not be liable for amounts actually paid under insured Conexant
Welfare Plans with respect to which Conexant and its Subsidiaries have no
obligation to reimburse for claims made with respect to incidents occurring
before the Time of Distribution covered thereby. Without limiting the generality
of the foregoing, from and after the Time of Distribution, Washington and the
Washington Subsidiaries (or where appropriate, the Washington Welfare Plans)
hereby assume or retain, as applicable, and will be solely responsible for and
will fully perform, pay and discharge, all Liabilities of Conexant or any of its
Subsidiaries (including members of the Washington Group) in respect of
Washington Participants (and claims by or relating to Washington Participants)
with respect to retiree health and welfare benefits and retiree life insurance
benefits, whether under the Conexant Welfare Plans, the Washington Welfare Plans
or otherwise, whether incurred, or arising in connection with incidents
occurring, before, at or after the Time of Distribution and whether any claim is
made with respect thereto before, at or after the Time of Distribution.
(e) From and after the Time of Distribution, Conexant and the
Conexant Subsidiaries hereby assume or retain, as applicable, and will be solely
responsible for and will fully perform, pay and discharge, all Liabilities of
Conexant or any of its Subsidiaries
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(including members of the Washington Group) in respect of Conexant Participants
(and claims by or relating to Conexant Participants) with respect to employee
welfare and fringe benefits (including medical, dental, vision, life, travel,
accident, short- and long-term disability, hospitalization, workers'
compensation and other insurance benefits), whether under the Conexant Welfare
Plans or otherwise, whether incurred, or arising in connection with incidents
occurring, before, at or after the Time of Distribution and whether any claim is
made with respect thereto before, at or after the Time of Distribution. Without
limiting the generality of the foregoing, from and after the Time of
Distribution, Conexant and the Conexant Subsidiaries (or where appropriate, the
Conexant Welfare Plans) hereby assume or retain, as applicable, and will be
solely responsible for and will fully perform, pay and discharge, all
Liabilities of Conexant or any of its Subsidiaries (including members of the
Washington Group) in respect of Conexant Participants (and claims by or relating
to Conexant Participants) with respect to retiree health and welfare benefits
and retiree life insurance benefits, whether under the Conexant Welfare Plans or
otherwise, whether incurred, or arising in connection with incidents occurring,
before, at or after the Time of Distribution and whether any claim is made with
respect thereto before, at or after the Time of Distribution.
Section 6.02 INCENTIVE COMPENSATION PLANS. (a) Effective as of
the Time of Distribution, Washington hereby assumes or retains, as applicable,
and will be solely responsible for and will fully perform, pay and discharge,
all Liabilities (including liability for earned but unpaid incentive payments)
of Conexant or any of its Subsidiaries (including members of the Washington
Group) for, due to and/or attributable to Washington Participants under the
Incentive Compensation Plans and all other long-term, annual and other incentive
compensation plans of Conexant and its Subsidiaries (including members of the
Washington Group) in effect at or prior to the Time of Distribution.
(b) Effective as of the Time of Distribution, Conexant hereby
assumes or retains, as applicable, and will be solely responsible for and will
fully perform, pay and discharge, all Liabilities (including liability for
earned but unpaid incentive payments) of Conexant or any of its Subsidiaries
(including members of the Washington Group) for, due to and/or attributable to
Pre-Distribution Group Employees under the Incentive Compensation Plans and all
other long-term, annual and other incentive compensation plans of Conexant and
its Subsidiaries (including members of the Washington Group) in effect at or
prior to the Time of Distribution, other than those assumed by Washington
pursuant to Section 6.02(a).
(c) Conexant and Washington will cooperate in taking all
actions necessary or appropriate to adjust the performance goals and other
applicable terms and conditions of awards under the Incentive Compensation Plans
and such other incentive compensation plans and arrangements for performance
periods that begin before and end after the Time of Distribution as appropriate
to reflect the Distribution.
(d) Notwithstanding anything to the contrary in Sections
6.02(a) through (c), nothing in this Section 6.02 will prevent either Conexant
or Washington from amending or terminating in accordance with the terms thereof
any existing,
12
or implementing any future, incentive compensation plans and arrangements on
such terms as Conexant or Washington may determine in their sole discretion
after the Time of Distribution.
Section 6.03 DEFERRED COMPENSATION PLANS.
(a) ESTABLISHMENT OF DEFERRED COMPENSATION PLANS AND RABBI
TRUST. Effective as of the Effective Time, Washington or Alpha will have
established, and will cover Washington Participants who were eligible to
participate in the Conexant Deferred Compensation Plan prior to the Time of
Distribution under, a new or existing deferred compensation plan (the
"WASHINGTON DEFERRED COMPENSATION PLAN") and Washington or Alpha will have
established a master rabbi trust related thereto (the "WASHINGTON DEFERRED
COMPENSATION PLAN RABBI TRUST"). The Washington Deferred Compensation Plan will
be substantially similar in all material respects to the Conexant Deferred
Compensation Plan, and will provide a benefit formula which will be
substantially similar in all material respects to the benefit formula that the
Conexant Deferred Compensation Plan provided immediately prior to the Time of
Distribution. The Washington Deferred Compensation Plan will credit each
Washington Participant thereunder for purposes of eligibility to participate,
vesting, benefit accruals and all other plan purposes with all service which had
been credited to such participant for such purposes under the Conexant Deferred
Compensation Plan immediately prior to the Time of Distribution (except to the
extent that such crediting would result in the duplication of benefits).
(b) ASSUMPTION OF DEFERRED COMPENSATION PLAN LIABILITIES.
(i) Effective as of the Time of Distribution, Washington
hereby assumes, and agrees to fully perform, pay and discharge, and
agrees to cause the Washington Deferred Compensation Plan and the
Washington Deferred Compensation Plan Rabbi Trust to assume, and to
fully perform, pay and discharge, all accrued benefit and other
Liabilities of Conexant or any of its Subsidiaries (including members
of the Washington Group) and of the Conexant Deferred Compensation
Plan and the Conexant Deferred Compensation Plan Rabbi Trust under and
relating to the Conexant Deferred Compensation Plan and the Conexant
Deferred Compensation Plan Rabbi Trust with respect to Washington
Participants who were covered under the Conexant Deferred Compensation
Plan prior to the Time of Distribution.
(ii) Effective as of the Time of Distribution, Conexant hereby
retains, and agrees to fully perform, pay and discharge, and agrees to
cause the Conexant Deferred Compensation Plan and the Conexant
Deferred Compensation Plan Rabbi Trust to retain, and to fully
perform, pay and discharge, all accrued benefit and other Liabilities
of Conexant or any of its Subsidiaries (including members of the
Washington Group) and of the Conexant Deferred Compensation Plan and
the Conexant Deferred Compensation Plan Rabbi Trust under and relating
to the Conexant Deferred Compensation Plan and the Conexant Deferred
Compensation Plan Rabbi Trust, other than those expressly assumed by
Washington pursuant to Section 6.03(b)(i).
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(c) TRANSFERS OF CONEXANT DEFERRED COMPENSATION PLAN RABBI
TRUST ASSETS. Within 30 days after the Time of Distribution, Conexant will cause
the Conexant Deferred Compensation Plan Rabbi Trust to transfer to the
Washington Deferred Compensation Plan Rabbi Trust, for the benefit of Washington
Participants who participated in the Conexant Deferred Compensation Plan prior
to the Time of Distribution, the account balances and life insurance policies
associated with such Washington Participants held by the Conexant Deferred
Compensation Plan Rabbi Trust.
Section 6.04 SEVERANCE PAY. (a) Conexant, Washington and Alpha
acknowledge and agree that the transactions contemplated by the Transaction
Agreements will not constitute a severance of employment of any employee of
Conexant or any of its Subsidiaries (including members of the Washington Group)
prior to or as a result of the transactions contemplated thereby, and that
individuals who, in connection with the Distribution, become Active Conexant
Employees or Active Washington Employees pursuant to this Agreement will not be
deemed to have experienced a termination, layoff or severance of employment from
Conexant and its Subsidiaries (including members of the Washington Group), in
each case for purposes of any policy, plan, program or agreement of Conexant or
any of its Subsidiaries (including any member of the Washington Group) that
provides for the payment of severance, salary continuation or similar benefits.
(b) Washington and the Washington Subsidiaries hereby assume
or retain, as applicable, and will be solely responsible for and will fully
perform, pay and discharge, all Liabilities of Conexant or any of its
Subsidiaries (including members of the Washington Group) in connection with
claims made by or on behalf of Washington Participants in respect of severance
pay, salary continuation and similar obligations relating to the termination or
alleged termination (whether voluntary or involuntary) of any such person's
employment, whether such termination or alleged termination occurred before, at
or after the Time of Distribution and whether any claim is made with respect
thereto before, at or after the Time of Distribution (whether or not such claim
is based on any severance policy, agreement, arrangement or program which may
exist or arise under any employment, collective bargaining or other agreement or
under any Federal, state, local, provincial or foreign law).
(c) Conexant and the Conexant Subsidiaries hereby assume or
retain, as applicable, and will be solely responsible for and will fully
perform, pay and discharge, all Liabilities of Conexant or any of its
Subsidiaries (including members of the Washington Group) in connection with
claims made by or on behalf of Pre-Distribution Group Employees in respect of
severance pay, salary continuation and similar obligations relating to the
termination or alleged termination (whether voluntary or involuntary) of any
such person's employment, whether such termination or alleged termination
occurred before, at or after the Time of Distribution and whether any claim is
made with respect thereto before, at or after the Time of Distribution (whether
or not such claim is based on any severance policy, agreement, arrangement or
program which may exist or arise under any employment, collective bargaining or
other agreement or under any Federal, state, local, provincial or foreign law),
other than those expressly assumed by Washington pursuant to Section 6.04(b).
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Section 6.05 EMPLOYMENT, CONSULTING AND OTHER EMPLOYEE RELATED
AGREEMENTS. (a) Effective as of the Time of Distribution, Washington and the
Washington Subsidiaries hereby assume or retain, as applicable, and will be
solely responsible for and will fully perform, pay and discharge, all
Liabilities of Conexant or any of its Subsidiaries (including members of the
Washington Group) relating to all Washington Participants under their respective
employment, consulting, separation, arbitration and other employee related
agreements with any member of the Pre-Distribution Group, as the same are in
effect immediately prior to the Time of Distribution.
(b) Effective as of the Time of Distribution, Conexant and the
Conexant Subsidiaries hereby assume or retain, as applicable, and will be solely
responsible for and will fully perform, pay and discharge, all Liabilities of
Conexant or any of its Subsidiaries (including members of the Washington Group)
relating to all Pre-Distribution Group Employees under their respective
employment, consulting, separation, arbitration and other employee related
agreements with any member of the Pre-Distribution Group, as the same are in
effect immediately prior to the Time of Distribution, other than those expressly
assumed by Washington pursuant to Section 6.05(a).
Section 6.06 EMPLOYEE STOCK PURCHASE PLANS. (a) Effective as
of the Effective Time, Alpha will have established, and will cover eligible
Active Washington Employees under, (i) an employee stock purchase plan which is
comparable to the Conexant 2001 ESPP (the "WASHINGTON ESPP") and (ii) a
non-qualified employee stock purchase plan which is comparable in all material
respects to the Conexant Non-Qualified ESPP (the "WASHINGTON NON-QUALIFIED
ESPP"). Each of the Washington ESPP and the Washington Non-Qualified ESPP will
credit each participating Active Washington Employee thereunder for purposes of
eligibility and vesting with all service which had been credited to such
employee for such purposes under the Conexant 2001 ESPP and the Conexant
Non-Qualified ESPP, respectively, immediately prior to the Time of Distribution.
(b) Pursuant to the provisions of the Conexant 2001 ESPP,
Conexant will take such action as is necessary to cause the shortening of each
Offering Period (as defined in such plan) in progress immediately prior to the
Time of Distribution by setting a New Exercise Date (as defined in such plan)
that precedes the Time of Distribution. Pursuant to the provisions of the
Conexant Non-Qualified ESPP, Conexant will take such action as is necessary to
cause the shortening of the Offering (as defined in such plan) in progress
immediately prior to the Time of Distribution by setting a New Exercise Date (as
defined in such plan) that precedes the Time of Distribution.
(c) Nothing contained in this Agreement shall require
Conexant, Washington or Alpha to continue to maintain any employee stock
purchase plan, program, or arrangement following the Time of Distribution.
(d) Effective as of the Time of Distribution, Conexant will
retain sponsorship of, and all rights, assets, authority and obligations under,
the Conexant 2001 ESPP, the Conexant Non-Qualified ESPP and the Conexant 1999
ESPP.
15
Section 6.07 VERP. (a) Effective as of the Effective Time,
Washington or Alpha will have established a new voluntary early retirement
program (the "WASHINGTON VERP"), the purpose of which will be to provide
benefits to Washington Participants who participate in the Conexant VERP
immediately prior to the Time of Distribution, and a trust related thereto (the
"WASHINGTON VERP TRUST"). The Washington VERP will be substantially similar in
all material respects to the Conexant VERP. The Washington VERP will credit each
Washington Participant thereunder for purposes of eligibility to participate and
benefit accruals and all other plan purposes with all service which has been
credited to such participant for such purposes under the Conexant VERP
immediately prior to the Time of Distribution (except to the extent that such
crediting would result in the duplication of benefits).
(b) Effective as of the Time of Distribution, Washington and
the Washington Subsidiaries hereby assume and agree to fully perform, pay and
discharge, and agree to cause the Washington VERP and the Washington VERP Trust
to assume, and to fully perform, pay and discharge, all accrued benefit and
other Liabilities of Conexant or any of its Subsidiaries (including members of
the Washington Group) and of the Conexant VERP and the Conexant VERP Trust under
and relating to the Conexant VERP and the Conexant VERP Trust with respect to
Washington Participants who were covered under the Conexant VERP prior to the
Time of Distribution.
(c) Effective as of the Time of Distribution, Conexant and the
Conexant Subsidiaries hereby retain and agree to fully perform, pay and
discharge, and agree to cause the Conexant VERP and the Conexant VERP Trust to
retain, and to fully perform, pay and discharge, all accrued benefit and other
Liabilities of Conexant or any of its Subsidiaries (including members of the
Washington Group) and of the Conexant VERP and the Conexant VERP Trust under and
relating to the Conexant VERP and the Conexant VERP Trust, other than those
expressly assumed by Washington pursuant to Section 6.07(b).
(d) Within 30 days after the Time of Distribution, Conexant
will cause the Conexant VERP Trust to transfer to the Washington VERP Trust, for
the benefit of Washington Participants who participated in the Conexant VERP
prior to the Time of Distribution, a proportionate share of the assets of the
Conexant VERP Trust, the amount of which will be equal to the PRODUCT OF: (i)
the aggregate value of all of the assets of the Conexant VERP Trust as of the
Time of Distribution MULTIPLIED BY (ii) the QUOTIENT OF (A) the actuarial
present value of accumulated plan benefits under the Conexant VERP for all
Washington Participants participating in the Conexant VERP immediately prior to
the Time of Distribution DIVIDED BY (B) the actuarial present value of
accumulated plan benefits under the Conexant VERP for all participants
participating in the Conexant VERP immediately prior to the Time of
Distribution. For purposes of determining such actuarial present value of
accumulated plan benefits under the Conexant VERP, the following actuarial
assumptions will be used: (x) life expectancy of participants shall be
determined using the 1985 Male and Female Group Annuity Maturity Table, (y) the
average retirement age shall be age 56.3 and (z) the average annual investment
return shall be 4.00%. The assets to be transferred from the Conexant VERP Trust
to the Washington VERP Trust, as calculated as set forth above, will be adjusted
for investment earnings between the Time of Distribution and the date of
transfer
16
at an annual rate equal to the rate for 1-year Treasury bills (as published in
Federal Reserve Statistical Release H.15) for the calendar month immediately
preceding the calendar month in which the date of transfer occurs and will be
reduced by the amount of any benefit payments to any Washington Participants
under the Conexant VERP after the Time of Distribution and a proportional share
of investment and administrative expenses. The amount of assets to be
transferred from the Conexant VERP Trust to the Washington VERP Trust pursuant
to this Section 6.07(d) will be calculated by Conexant's actuary. The transfer
of assets from the Conexant VERP Trust to the Washington VERP Trust will be made
in cash, mutual fund account balances or other property, as determined by
Conexant.
(e) Notwithstanding anything to the contrary in this Section
6.07, in the case of retiree medical benefits provided to participants in the
Conexant VERP on account of a retiree medical benefit program sponsored by a
predecessor of Conexant, Washington hereby agrees to assume responsibility for
administration of such benefits for Washington Participants after the Time of
Distribution.
Section 6.08 OTHER LIABILITIES. (a) From and after the Time of
Distribution, except as specifically set forth in this Agreement, Washington and
the Washington Subsidiaries hereby assume or retain, as applicable, and will be
solely responsible for and will fully perform, pay and discharge, all
Liabilities of Conexant or any of its Subsidiaries (including members of the
Washington Group) arising out of or relating to the employment of Washington
Participants by any member of the Pre-Distribution Group, whether pursuant to
benefit plans or otherwise and whether such Liabilities arose before, at or
after the Time of Distribution or any claim is made with respect thereto before,
at or after the Time of Distribution.
(b) From and after the Time of Distribution, except as
specifically set forth in this Agreement, Conexant and the Conexant Subsidiaries
hereby assume or retain, as applicable, and will be solely responsible for and
will fully perform, pay and discharge, all Liabilities of Conexant or any of its
Subsidiaries (including members of the Washington Group) arising out of or
relating to the employment of Pre-Distribution Group Employees by any member of
the Pre-Distribution Group, whether pursuant to benefit plans or otherwise and
whether such Liabilities arose before, at or after the Time of Distribution or
any claim is made with respect thereto before, at or after the Time of
Distribution, other than those expressly assumed by Washington pursuant to
Section 6.08(a).
ARTICLE VII
MISCELLANEOUS
Section 7.01 INDEMNIFICATION. All Liabilities retained or
assumed by or allocated to Washington, any Washington Subsidiary or Alpha
pursuant to this Agreement will be deemed to be Washington Liabilities (as
defined in the Distribution Agreement), and all Liabilities retained or assumed
by or allocated to Conexant or any Conexant Subsidiary pursuant to this
Agreement will be deemed to be Conexant Liabilities (as defined in the
17
Distribution Agreement), and, in each case, will be subject to the
indemnification provisions set forth in Article IV of the Distribution
Agreement.
Section 7.02 SHARING OF INFORMATION. Each of Conexant,
Washington and Alpha will, and will cause each of their respective Subsidiaries
to, provide to the other parties all such Information in its possession as the
other parties may reasonably request to enable the requesting party to
administer its employee benefit plans and programs, and to determine the scope
of, and fulfill, its obligations under this Agreement. Such Information will, to
the extent reasonably practicable, be provided in the format and at the times
and places requested, but in no event will the party providing such Information
be obligated to incur any out-of-pocket expense not reimbursed by the party
making such request, nor to make such Information available outside its normal
business hours and premises. Any Information shared or exchanged pursuant to
this Agreement will be subject to the confidentiality requirements set forth in
the Distribution Agreement.
Section 7.03 ENTIRE AGREEMENT; CONSTRUCTION. This Agreement,
the Distribution Agreement and the other Ancillary Agreements, including any
schedules and exhibits hereto or thereto, and other agreements and documents
referred to herein and therein, will together constitute the entire agreement
between the parties with respect to the subject matter hereof and thereof and
will supersede all prior negotiations, agreements and understandings of the
parties of any nature, whether oral or written, with respect to such subject
matter. Notwithstanding any other provisions in the Transaction Agreements to
the contrary, in the event and to the extent that there is a conflict between
the provisions of this Agreement and the provisions of the Distribution
Agreement, the provisions of this Agreement will control.
Section 7.04 SURVIVAL OF AGREEMENTS. Except as otherwise
contemplated by the Transaction Agreements, all covenants and agreements of the
parties contained in this Agreement will remain in full force and effect and
survive the Time of Distribution.
Section 7.05 GOVERNING LAW. This Agreement will be governed by
and construed in accordance with the internal laws of the State of Delaware
applicable to contracts made and to be performed entirely within such State,
without regard to the conflicts of law principles of such State.
Section 7.06 NOTICES. All notices, requests, claims, demands
and other communications required or permitted to be given hereunder will be in
writing and will be delivered by hand, telecopied, e-mailed or sent, postage
prepaid, by registered, certified or express mail or reputable overnight courier
service and will be deemed given when so delivered by hand or telecopied, when
e-mail confirmation is received if delivered by e-mail, or three business days
after being so mailed (one business day in the case of express mail or overnight
courier service). All such notices, requests, claims, demands and other
communications will be addressed as set forth in Section 7.04 of the
Distribution Agreement (provided that such notices, requests, claims, demands
and other communications to Alpha shall be addressed to Alpha at the same notice
address set forth for Washington in
18
Section 7.04 of the Distribution Agreement), or pursuant to such other
instructions as may be designated in writing by the party to receive such
notice.
Section 7.07 AMENDMENTS. This Agreement cannot be amended,
modified or supplemented except by a written agreement executed by each party
affected thereby.
Section 7.08 ASSIGNMENT. No party to this Agreement will
convey, assign or otherwise transfer any of its rights or obligations under this
Agreement without the prior written consent of the other parties in their sole
and absolute discretion. Notwithstanding the foregoing, any party may (without
obtaining any consent) assign, delegate or sublicense all or any portion of its
rights and obligations hereunder to (i) the surviving entity resulting from a
merger or consolidation involving such party, (ii) the acquiring entity in a
sale or other disposition of all or substantially all of the assets of such
party as a whole or of any line of business or division of such party, or (iii)
any other Person that is created as a result of a spin-off from, or similar
reorganization transaction of, such party or any line of business or division of
such party. In the event of an assignment pursuant to (ii) or (iii) above, the
nonassigning party shall, at the assigning party's request, use good faith
commercially reasonable efforts to enter into separate agreements with each of
the resulting entities and take such further actions as may be reasonably
required to assure that the rights and obligations under this Agreement are
preserved, in the aggregate, and divided equitably between such resulting
entities. Any conveyance, assignment or transfer requiring the prior written
consent of another party pursuant to this Section 7.08 which is made without
such consent will be void AB INITIO. No assignment of this Agreement will
relieve the assigning party of its obligations hereunder.
Section 7.09 CAPTIONS; CURRENCY. The article, section and
paragraph captions herein and the table of contents hereto are for convenience
of reference only, do not constitute part of this Agreement and will not be
deemed to limit or otherwise affect any of the provisions hereof. Unless
otherwise specified, all references herein to numbered articles or sections are
to articles and sections of this Agreement and all references herein to
schedules are to schedules to this Agreement. Unless otherwise specified, all
references contained in this Agreement, in any schedule referred to herein or in
any instrument or document delivered pursuant hereto to dollars or $ will mean
United States Dollars.
Section 7.10 SEVERABILITY. If any provision of this Agreement
or the application thereof to any Person or circumstance is determined by a
court of competent jurisdiction to be invalid, void or unenforceable, the
remaining provisions hereof, or the application of such provision to Persons or
circumstances other than those as to which it has been held invalid or
unenforceable, will remain in full force and effect and will in no way be
affected, impaired or invalidated thereby. If the economic or legal substance of
the transactions contemplated hereby is affected in any manner adverse to any
party as a result thereof, the parties will negotiate in good faith in an effort
to agree upon a suitable and equitable substitute provision to effect the
original intent of the parties.
Section 7.11 PARTIES IN INTEREST. This Agreement is binding
upon and is for the benefit of the parties hereto and their respective
successors and permitted assigns. This
19
Agreement is not made for the benefit of any Person not a party hereto, and no
Person other than the parties hereto or their respective successors and
permitted assigns will acquire or have any benefit, right, remedy or claim under
or by reason of this Agreement. No provision of this Agreement will be construed
(a) to limit the right of Conexant, any Conexant Subsidiary, Washington, any
Washington Subsidiary or Alpha to amend or terminate any of their plans or (b)
to create any right or entitlement whatsoever in any employee, former employee
or beneficiary including a right to continued employment or to any benefit under
a plan or any other benefit or compensation.
Section 7.12 SCHEDULES. All schedules attached hereto are
hereby incorporated in and made a part of this Agreement as if set forth in full
herein. Capitalized terms used in the schedules hereto but not otherwise defined
therein will have the respective meanings assigned to such terms in this
Agreement.
Section 7.13 CHANGE OF NAME. On or promptly after the
Distribution Date, Washington will take such actions as may be required to
change the names of all employee benefit plans sponsored or maintained by
Washington, any Washington Subsidiary or Alpha to eliminate therefrom any
reference to "Conexant", "Conexant Systems", "Conexant Systems, Inc. or any
derivative thereof.
Section 7.14 WAIVERS; REMEDIES. No failure or delay on the
part of Conexant, Washington or Alpha in exercising any right, power or
privilege hereunder will operate as a waiver thereof, nor will any waiver on the
part of Conexant, Washington or Alpha of any right, power or privilege hereunder
operate as a waiver of any other right, power or privilege hereunder, nor will
any single or partial exercise of any right, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege hereunder. The rights and remedies herein provided are
cumulative and are not exclusive of any rights or remedies which the parties may
otherwise have at law or in equity.
Section 7.15 COUNTERPARTS. This Agreement may be executed in
separate counterparts, each such counterpart being deemed to be an original
instrument, and all such counterparts will together constitute the same
agreement.
Section 7.16 PERFORMANCE. Conexant will cause to be performed
and hereby guarantees the performance of all actions, agreements and obligations
set forth herein to be performed by any Conexant Subsidiary. Washington will
cause to be performed and hereby guarantees the performance of all actions,
agreements and obligations set forth herein to be performed by any Washington
Subsidiary. Alpha will cause to be performed and hereby guarantees the
performance of all actions, agreements and obligations set forth herein to be
performed by any Subsidiary or Affiliate of Alpha. In addition, Alpha and
Conexant acknowledge that from and after the Effective Time (as defined in the
Merger Agreement), Alpha will succeed to all rights, obligations and Liabilities
of Washington under this Agreement.
Section 7.17 DISPUTE RESOLUTION. Any dispute, claim or
controversy arising out of or relating to any provision of this Agreement or the
breach, performance or validity
20
thereof will be resolved in accordance with the procedures set forth in Section
7.05 of the Distribution Agreement.
Section 7.18 COOPERATION. Conexant, Washington and Alpha will
cooperate in taking all such action as may be necessary or appropriate to
implement the provisions of this Agreement, including making all appropriate
filings as may be required under ERISA or the Code, the regulations thereunder
and any other applicable laws, exchanging and sharing all appropriate records,
amending plan, trust, record keeping and other related documents and
implementing all appropriate communications with participants.
Section 7.19 INTERPRETATION. Any reference to any Federal,
state, local, provincial or foreign law shall be deemed also to refer to all
rules and regulations promulgated thereunder, unless the context requires
otherwise. For the purposes of this Agreement, (i) words in the singular shall
be held to include the plural and vice versa and words of one gender shall be
held to include the other gender as the context requires, (ii) the terms
"hereof", "herein", and "herewith" and words of similar import shall, unless
otherwise stated, be construed to refer to this Agreement as a whole and not to
any particular provision of this Agreement, (iii) the word "including" and words
of similar import when used in this Agreement shall mean "including, without
limitation" and (iv) all references to any plan shall be deemed to include any
amendments thereto.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
21
IN WITNESS WHEREOF, this Agreement has been duly executed and
delivered by the duly authorized officers of the parties as of the date first
hereinabove written.
CONEXANT SYSTEMS, INC.
By:
---------------------------------
Name:
Title:
WASHINGTON SUB, INC.
By:
---------------------------------
Name:
Title:
ALPHA INDUSTRIES, INC.
By:
---------------------------------
Name:
Title:
22
