Exhibit 2.3
GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT
between
▇▇▇▇ ▇▇▇ CORPORATION
and
COACH, INC.
TABLE OF CONTENTS
Page
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ARTICLE I CONTRIBUTION AND ASSUMPTION....................................................1
Section 1.1 Contribution of Assets and Assumption of
Liabilities..........................................1
Section 1.2 Coach Assets.........................................2
Section 1.3 Coach Liabilities....................................4
Section 1.4 Shared Contracts.....................................6
Section 1.5 Methods of Transfer and Assumption. .................7
Section 1.6 Documents Relating to Transfers of Coach
Assets and Assumption of Coach Liabilities...........8
Section 1.7 Governmental Approvals and Consents..................8
Section 1.8 Nonrecurring Costs and Expenses......................9
Section 1.9 Novation of Assumed Coach Liabilities................9
ARTICLE II LITIGATION...................................................................10
Section 2.1 Litigation..........................................10
Section 2.2 Cooperation.........................................11
ARTICLE III MISCELLANEOUS...............................................................12
Section 3.1 Entire Agreement....................................12
Section 3.2 Governing Law and Jurisdiction......................12
Section 3.3 Notices.............................................12
Section 3.4 Termination.........................................13
Section 3.5 Parties in Interest.................................13
Section 3.6 Counterparts........................................13
Section 3.7 Assignment..........................................13
Section 3.8 Severability........................................14
Section 3.9 Failure or Indulgence Not Waiver; Remedies
Cumulative..........................................14
Section 3.10 Amendment...........................................14
Section 3.11 Authority...........................................14
Section 3.12 Interpretation......................................14
Section 3.13 Conflicting Agreements..............................15
Section 3.14 Dispute Resolution..................................15
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ARTICLE IV DEFINITIONS..................................................................16
Section 4.1 AAA.................................................16
Section 4.2 Action..............................................16
Section 4.3 Affiliated Company..................................16
Section 4.4 Ancillary Agreement.................................17
Section 4.5 Assets..............................................17
Section 4.6 Coach Affiliate.....................................19
Section 4.7 Coach Assets........................................19
Section 4.8 Coach Balance Sheet.................................19
Section 4.9 Coach Business......................................19
Section 4.10 Coach Contingent Gain...............................19
Section 4.11 Coach Contingent Liability..........................20
Section 4.12 Coach Contracts.....................................20
Section 4.13 Coach Group.........................................21
Section 4.14 Coach Liabilities...................................21
Section 4.15 Coach Pro Forma Balance Sheet.......................21
Section 4.16 Consents............................................21
Section 4.17 Contracts...........................................22
Section 4.18 Delayed Transfer Assets.............................22
Section 4.19 Delayed Transfer Liabilities........................22
Section 4.20 Dispute.............................................22
Section 4.21 Dispute Resolution Commencement Date................22
Section 4.22 Distribution........................................22
Section 4.23 Distribution Date...................................23
Section 4.24 Excluded Assets.....................................22
Section 4.25 Excluded Liabilities................................22
Section 4.26 Governmental Approvals..............................22
Section 4.27 Governmental Authority..............................23
Section 4.28 Indemnification and Insurance Matters
Agreement...........................................23
Section 4.29 Insurance Policies..................................23
Section 4.30 Insurance Proceeds..................................23
Section 4.31 Insured Coach Liabilities...........................23
Section 4.32 Intellectual Property...............................23
Section 4.33 IPO.................................................24
Section 4.34 IPO Closing Date....................................24
Section 4.35 IPO Registration Statement..........................24
Section 4.36 Liabilities.........................................24
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Section 4.37 Other Financial Liabilities.........................24
Section 4.38 Person..............................................25
Section 4.39 Real Estate Matters Agreement.......................25
Section 4.40 ▇▇▇▇ ▇▇▇ Affiliate..................................25
Section 4.41 ▇▇▇▇ ▇▇▇ Group......................................25
Section 4.42 Security Interest...................................25
Section 4.43 Separation..........................................25
Section 4.44 Separation Agreement................................25
Section 4.45 Separation Date.....................................25
Section 4.46 Shared Contract.....................................25
Section 4.47 Shared Contractual Liabilities......................26
Section 4.48 Subsidiary..........................................26
Section 4.49 Tax Sharing Agreement...............................26
Section 4.50 Taxes...............................................26
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SCHEDULES
Schedule 1.1(c)..........................................................28
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GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT
This General Assignment and Assumption Agreement (this "Agree
ment") is dated as of August 24, 2000 between ▇▇▇▇ ▇▇▇ Corporation, a ▇▇▇▇
▇▇▇▇ corporation ("▇▇▇▇ ▇▇▇"), and Coach, Inc., a Maryland corporation
("Coach"). Capitalized terms used herein and not otherwise defined herein
shall have the meanings ascribed to such terms in Article IV hereof.
RECITALS
WHEREAS, ▇▇▇▇ ▇▇▇ hereby and by certain other instruments of
even date herewith transfers or will transfer to Coach effective as of the
Separation Date, certain assets of the Coach Business owned by ▇▇▇▇ ▇▇▇ in
accordance with the Master Separation Agreement dated as of August 24, 2000
between ▇▇▇▇ ▇▇▇ and Coach (the "Separation Agreement").
WHEREAS, it is further intended between the parties that Coach
assume certain of the liabilities related to the Coach Business currently
owned by ▇▇▇▇ ▇▇▇, as provided in this Agreement, the Separation Agreement or
the other agreements and instruments provided for in the Separation Agreement.
NOW, THEREFORE, in consideration of the foregoing and the
covenants and agreements set forth below, the parties hereto agree as follows:
ARTICLE I
CONTRIBUTION AND ASSUMPTION
Section 1.1 CONTRIBUTION OF ASSETS AND ASSUMPTION OF LIABILITIES.
(a) TRANSFER OF ASSETS. Effective as of the Separation Date,
▇▇▇▇ ▇▇▇ hereby assigns, transfers, conveys and delivers (or will cause any
applicable Subsidiary to assign, transfer, convey and deliver) to Coach and
Coach hereby accepts from ▇▇▇▇ ▇▇▇, or the applicable ▇▇▇▇ ▇▇▇ Subsidiary,
and agrees to cause the applicable Coach Subsidiary to accept, all of ▇▇▇▇
▇▇▇'▇ and its applicable Subsidiaries' respective right, title and interest
in all Coach Assets, other than the Delayed Transfer Assets; PROVIDED,
HOWEVER, that any Coach Assets that are specifically assigned or transferred
pursuant to another Ancillary Agreement shall not be assigned or transferred
pursuant to this Section 1.1(a).
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(b) ASSUMPTION OF LIABILITIES. Effective as of the Separation
Date, Coach hereby assumes and agrees faithfully to perform and fulfill (or
will cause any applicable Coach Subsidiary to assume, perform and fulfill)
all the Coach Liabilities heretofore held by ▇▇▇▇ ▇▇▇, other than the Delayed
Transfer Liabilities, in accordance with their respective terms. Thereafter,
Coach shall be responsible (or will cause any applicable Coach Subsidiary to
be responsible) for all Coach Liabilities held by ▇▇▇▇ ▇▇▇, regardless of
when or where such Liabilities arose or arise, or whether the facts on which
they are based occurred prior to, on or after the date hereof, regardless of
where or against whom such Liabilities are asserted or determined (including
any Coach Liabilities arising out of claims made by ▇▇▇▇ ▇▇▇'▇ or Coach's
respective directors, officers, consultants, independent contractors,
employees or agents against any member of the ▇▇▇▇ ▇▇▇ Group or the Coach
Group) or whether asserted or determined prior to the date hereof, and
regardless of whether arising from or alleged to arise from negligence,
recklessness, violation of law, misrepresentation by any member of the ▇▇▇▇
▇▇▇ Group or the Coach Group or any of their respective directors, officers,
employees or agents, except for any Liabilities resulting from any fraudulent
act by ▇▇▇▇ ▇▇▇ in the operation of the Coach Business prior to the
Separation Date.
(c) DELAYED TRANSFER ASSETS AND LIABILITIES. Each of the
parties hereto agrees that the Delayed Transfer Assets will be assigned,
transferred, conveyed and delivered, and the Delayed Transfer Liabilities
will be assumed, in accordance with the terms of the agreements that provide
for such assignment, transfer, conveyance and delivery, or such assumption,
after the date of this Agreement or as otherwise set forth on Schedule
1.1(c). Following such assignment, transfer, conveyance and delivery of any
Delayed Transfer Asset, or the assumption of any Delayed Transfer Liability,
the applicable Delayed Transfer Asset or Delayed Transfer Liability shall be
treated for all purposes of this Agreement and the other Ancillary Agreements
as a Coach Asset or as a Coach Liability, as the case may be.
(d) MISALLOCATED ASSETS. In the event that at any time or from
time to time (whether prior to, on or after the Separation Date), any party
hereto (or any member of such party's respective Group) shall receive or
otherwise possess any Asset that is allocated to any other Person pursuant to
this Agreement or any Ancillary Agreement, such party shall promptly
transfer, or cause to be transferred, such Asset to the Person so entitled
thereto. Prior to any such transfer, the Person receiving or possessing such
Asset shall hold such Asset in trust for any such other Person.
Section 1.2 COACH ASSETS.
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(a) INCLUDED ASSETS. For purposes of this Agreement, "Coach
Assets" shall mean (without duplication) the following Assets, except as
otherwise provided for in any other Ancillary Agreement or other written
agreement of the parties:
(i) all Assets reflected in the Coach Balance Sheet,
subject to any dispositions of such Assets subsequent to the date of the
Coach Balance Sheet; PROVIDED, HOWEVER, that such Assets shall exclude
the accounts receivable from ▇▇▇▇ ▇▇▇ that are reflected in the Coach
Balance Sheet but that, as disclosed in the IPO Registration Statement,
will be capitalized into ▇▇▇▇ ▇▇▇'▇ equity on or prior to the completion
of the IPO;
(ii) all Assets that have been written off, expensed or
fully depreciated that, had they not been written off, expensed or fully
depreciated, would have been reflected in the Coach Balance Sheet in
accordance with the principles and accounting policies under which the
Coach Balance Sheet was prepared;
(iii) all Assets acquired by ▇▇▇▇ ▇▇▇ or its Subsidiaries
after the date of the Coach Balance Sheet that would be reflected in the
balance sheet of Coach as of the Separation Date if such balance sheet
was prepared using the same principles and accounting policies under
which the Coach Balance Sheet was prepared;
(iv) all Assets that should have been reflected in the
Coach Balance Sheet as of the Separation Date but are not reflected in
the Coach Balance Sheet due to mistake or unintentional omission;
PROVIDED, HOWEVER, that, subject to Section 1.5(b), no Asset shall be a
Coach Asset requiring any transfer by ▇▇▇▇ ▇▇▇ unless Coach or its
Subsidiaries have, on or before the earlier of the second anniversary of
the Separation Date or the Distribution Date, given ▇▇▇▇ ▇▇▇ or its
Subsidiaries notice that Coach believes that such Asset is a Coach
Asset;
(v) all Coach Contingent Gains;
(vi) all Coach Contracts;
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(vii) all Intellectual Property used exclusively in the
Coach Business, which shall include, without limitation, the tradename
and trademarks COACH, COACH AND LOZENGE design, COACH AND TAG
design, "C" SIGNATURE FABRIC design and any other trademarks using the
name "Coach";
(viii) to the extent permitted by law and subject to the
Indemnification and Insurance Matters Agreement, all rights of any
member of the Coach Group under any of ▇▇▇▇ ▇▇▇'▇ Insurance Policies or
other insurance policies issued by Persons unaffiliated with ▇▇▇▇ ▇▇▇;
(ix) all outstanding capital stock of Coach Stores Puerto
Rico, Inc., a Delaware corporation, Coach Leatherware Int'l, Inc., a
Delaware corporation, Coach Europe Services S.r.l., an Italian
corporation, and Coach U.K. Ltd., a United Kingdom corporation; and
(x) all Assets that are expressly contemplated by this
Agreement, the Separation Agreement or any other Ancillary Agreement or
any Schedule hereto or thereto as Assets to be transferred to Coach or
any other member of the Coach Group.
Notwithstanding the foregoing, the Coach Assets shall not include the Excluded
Assets referred to in Section 1.2(b) below.
(b) EXCLUDED ASSETS. For the purposes of this Agreement,
"Excluded Assets" shall mean any Assets that are expressly contemplated by the
Separation Agreement, this Agreement or any other Ancillary Agreement (or the
Schedules hereto or thereto) as Assets to be retained by ▇▇▇▇ ▇▇▇ or any other
member of the ▇▇▇▇ ▇▇▇ Group.
Section 1.3 COACH LIABILITIES.
(a) INCLUDED LIABILITIES. For the purposes of this Agreement,
"Coach Liabilities" shall mean (without duplication) the following Liabilities,
except as otherwise provided for in any other Ancillary Agreement or other
express agreement of the parties:
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(i) all Liabilities reflected in the Coach Balance Sheet,
subject to any discharge of such Liabilities subsequent to the date of
the Coach Balance Sheet;
(ii) all Liabilities of ▇▇▇▇ ▇▇▇ or its Subsidiaries that
arise after the date of the Coach Balance Sheet that would be reflected
in the balance sheet of Coach as of the Separation Date if such balance
sheet was prepared using the same principles and accounting policies
under which the Coach Balance Sheet was prepared;
(iii) all Liabilities that should have been reflected in
the Coach Balance Sheet as of the Separation Date but are not reflected
in the Coach Balance Sheet due to mistake or unintentional omission;
PROVIDED, HOWEVER, that, subject to Section 1.5(b), no Liability shall
be considered as a Coach Liability unless ▇▇▇▇ ▇▇▇ or its Subsidiaries,
on or before the earlier of the second anniversary of the Separation
Date or the Distribution Date, has given Coach or its Subsidiaries
notice that ▇▇▇▇ ▇▇▇ believes that such Liability is a Coach Liability;
(iv) all Coach Contingent Liabilities;
(v) all Liabilities (other than Liabilities for Taxes),
whether arising before, on or after the Separation Date, substantially
or exclusively relating to, arising out of or resulting from:
(1) the operation of the Coach Business, as
conducted at any time prior to, on or after the Separation Date
(including any Liability relating to, arising out of or resulting from
any act or failure to act by any director, officer, employee, agent or
representative (whether or not such act or failure to act is or was
within such Person's authority));
(2) the operation of any business conducted
by any member of the Coach Group at any time after the Separation Date
(including any Liability relating to, arising out of or resulting from
any act or failure to act by any director, officer, employee, agent or
representative (whether or not such act or failure to act is or was
within such Person's authority)); or
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(3) any Coach Assets;
(vi) outstanding indebtedness of ▇▇▇▇ ▇▇▇ owing to
International Affiliates & Investment Inc., a Delaware corporation, as
lender, and evidenced by a Term Note dated as of June 30, 2000 in an
aggregate principal amount of $190,000,000;
(vii) all Liabilities that are expressly contemplated by
this Agreement, the Separation Agreement or any other Ancillary
Agreement (or the Schedules hereto or thereto) as Liabilities to be
assumed by Coach or any member of the Coach Group, and all agree ments,
obligations and Liabilities of any member of the Coach Group under this
Agreement or any of the Ancillary Agreements.
Notwithstanding the foregoing, the Coach Liabilities shall not
include the Excluded Liabilities referred to in Section 1.3(b) below.
(b) EXCLUDED LIABILITIES. For the purposes of this Agreement,
"Excluded Liabilities" shall mean:
(i) all Insured Coach Liabilities;
(ii) all Liabilities that are expressly contemplated by
this Agreement, the Separation Agreement or any other Ancillary
Agreement (or the Schedules hereto or thereto) as Liabilities to be
retained or assumed by ▇▇▇▇ ▇▇▇ or any other member of the ▇▇▇▇ ▇▇▇
Group, and all agreements and obligations of any member of the ▇▇▇▇ ▇▇▇
Group under the Separation Agreement, this Agreement or any other
Ancillary Agreement.
Section 1.4 SHARED CONTRACTS.
(a) With respect to Shared Contractual Liabilities pursuant to,
under or relating to a given Shared Contract, such Shared Contractual
Liabilities shall be allocated between the parties as follows:
(i) First, if a Liability is incurred exclusively in
respect of a benefit received by one party, the party receiving such
benefit shall be responsible for such Liability.
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(ii) Second, if a Liability cannot be exclusively
allocated to one party under clause (i), such Liability shall be
allocated among both parties based on the relative proportions of total
benefit received (over the term of the Shared Contract, measured as of
the date of allocation) under the relevant Shared Contract.
Notwithstanding the foregoing, each party shall be responsible for any
or all Liabilities arising out of or resulting from its breach of the
relevant Shared Contract.
(b) If ▇▇▇▇ ▇▇▇ or any member of the ▇▇▇▇ ▇▇▇ Group, on the one
hand, or Coach or any member of the Coach Group, on the other hand, receives any
benefit or payment under any Shared Contract which was intended for the other
party, ▇▇▇▇ ▇▇▇ and any member of the ▇▇▇▇ ▇▇▇ Group, on the one hand, or Coach
and any member of the Coach Group, on the other hand, will use their respective
commercially reasonable efforts to deliver, transfer or otherwise afford such
benefit or payment (on an after-tax basis) to the other party.
Section 1.5 METHODS OF TRANSFER AND ASSUMPTION.
(a) TERMS OF OTHER ANCILLARY AGREEMENTS GOVERN. The parties
shall enter into the other Ancillary Agreements, on or about the date of this
Agreement. To the extent that the transfer of any Coach Asset or the
assumption of any Coach Liability is expressly provided for by the terms of
any other Ancillary Agreement, the terms of such other Ancillary Agreement
shall effect, and determine the manner of, the transfer or assumption. For
example, and without limitation, transfers of interests in real property used
substantially or exclusively in the Coach Business shall be governed by the
Real Estate Matters Agreement. It is the intent of the parties that pursuant
to Sections 1.1, 1.2, 1.3 and 1.4, the transfer and assumption of all other
Coach Assets and Coach Liabilities, other than Delayed Transfer Assets and
Delayed Transfer Liabilities, shall be made effective as of the Separation
Date.
(b) MISTAKEN ASSIGNMENTS AND ASSUMPTIONS. In addition to those
transfers and assumptions accurately identified and designated by the parties
to take place but which the parties are not able to effect prior to the
Separation Date, there may exist (i) Assets that the parties discover were,
contrary to the agreements between the parties, by mistake or unintentional
omission, transferred to Coach or retained by ▇▇▇▇ ▇▇▇ or (ii) Liabilities
that the parties discover were, contrary to the agreements between the
parties, by mistake or unintentional omission, assumed by
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Coach or not assumed by Coach. The parties shall cooperate in good faith to
effect the transfer or re-transfer of such Assets, and/or the assumption or
re-assumption of such Liabilities, to or by the appropriate party and shall
not use the determination that remedial actions need to be taken to alter the
original intent of the parties hereto with respect to the Assets to be
transferred to or Liabilities to be assumed by Coach. Each party shall
reimburse the other or make other financial adjustments or other adjustments
to remedy any mistakes or omissions relating to any of the Assets transferred
hereby or any of the Liabilities assumed hereby.
(c) TRANSFER OF ASSETS AND LIABILITIES NOT INCLUDED IN COACH
ASSETS AND COACH LIABILITIES. In the event the parties discover Assets and
Liabilities that relate substantially or exclusively to the Coach Business
but do not constitute Coach Assets under Section 2.1 or Coach Liabilities
under Section 1.3, the parties shall cooperate in good faith to effect the
transfer of such Assets at book value, or the assumption of such Liabilities,
to Coach or its Subsidiaries to the extent such Assets or Liabilities relate
substantially or exclusively to the Coach Business and shall not use the
determination of remedial actions contemplated in the Separation Agreement to
alter the original intent of the parties hereto with respect to the Assets to
be transferred to or Liabilities to be assumed by Coach. Each party shall
reimburse the other or make other financial adjustments or other adjustments
to remedy any mistakes or omissions relating to any of the Assets transferred
hereby or any of the Liabilities assumed hereby.
Section 1.6 DOCUMENTS RELATING TO TRANSFERS OF COACH ASSETS AND
ASSUMPTION OF COACH LIABILITIES. In furtherance of the assignment, transfer
and conveyance of Coach Assets and the assumption of Coach Liabilities set
forth in Section 1.1 and Sections 1.4(a), (b) and (c) and certain other
Ancillary Agreements, simulta neously with the execution and delivery hereof
or as promptly as practicable thereafter, (i) ▇▇▇▇ ▇▇▇ shall execute and
deliver, and shall cause its Subsidiaries to execute and deliver, such bills
of sale, stock powers, certificates of title, assignments of contracts and
other instruments of transfer, conveyance and assignment as and to the extent
necessary to evidence the transfer, conveyance and assignment of all of ▇▇▇▇
▇▇▇'▇ and its Subsidiaries' right, title and interest in and to the Coach
Assets to Coach and (ii) Coach shall execute and deliver to ▇▇▇▇ ▇▇▇ and its
Subsidiaries such assumptions of contracts and other instruments of
assumption as and to the extent necessary to evidence the valid and effective
assumption of the Coach Liabilities by Coach.
Section 1.7 GOVERNMENTAL APPROVALS AND CONSENTS.
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(a) TRANSFER IN VIOLATION OF LAWS. If and to the extent that
the valid, complete and perfected transfer or assignment to the Coach Group
of any Coach Assets or assumption or novation by the Coach Group of any
Silver Liabilities would be a violation of applicable laws or require any
Consent or Governmental Approval in connection with the Separation, the IPO
or any Distribution, then, unless ▇▇▇▇ ▇▇▇ shall otherwise determine, the
transfer or assignment to the Coach Group of such Coach Assets or the
assumption or novation by the Coach Group of such Coach Liabilities shall be
automatically deemed deferred and any such purported transfer, assignment,
assumption or novation shall be null and void until such time as all legal
impediments are removed and/or such Consents or Governmental Approvals have
been obtained. Notwithstanding the foregoing, any such Asset shall still be
considered a Coach Asset and any such Liability shall still be considered a
Coach Liability for purposes of determining whether any Liability is a Coach
Liability; PROVIDED, HOWEVER, that if such Consents or Governmental Approvals
have not been obtained within six months of the Separation Date, the parties
will use their commercially reasonable efforts to achieve an alternative
solution in accordance with the parties' intentions. If and when the Consents
and/or Governmental Approvals, the absence of which caused the deferral of
transfer of any Asset or any Liability pursuant to this Section 1.7(a), are
obtained, the transfer of the applicable Asset or the assumption of the
applicable Liability shall be effected in accordance with the terms of this
Agreement and/or such other applicable Ancillary Agreement.
(b) TRANSFERS NOT CONSUMMATED PRIOR TO SEPARATION DATE. If the
transfer, assignment or novation of any Assets intended to be transferred or
assigned hereunder is not consummated prior to or on the Separation Date,
whether as a result of the provisions of Section 1.7(a) or for any other
reason, then the Person retaining such Asset shall thereafter hold such Asset
for the use and benefit, insofar as reasonably possible, of the Person
entitled thereto (at the expense of the Person entitled thereto). In
addition, the Person retaining such Asset shall take such other actions as
may be reasonably requested by the Person to whom such Asset is to be
transferred in order to place such Person, insofar as reasonably possible, in
the same position as if such Asset had been transferred as contemplated
hereby and so that all the benefits and burdens relating to such Asset,
including possession, use, risk of loss, potential for gain, and dominion,
control and command over such Asset, are to inure from and after the
Separation Date to the Coach Group (or the ▇▇▇▇ ▇▇▇ Group, as the case may
be).
(c) EXPENSES. The Person retaining an Asset due to the
deferral of the transfer of such Asset shall not be obligated, in connection
with the foregoing, to expend any money in connection with the maintenance of
the Asset or otherwise unless
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the necessary funds are advanced by the Person entitled to the Asset, other
than reasonable out-of-pocket expenses, attorneys' fees and recording or
similar fees, all of which shall be promptly reimbursed by the Person
entitled to such Asset.
Section 1.8 NONRECURRING COSTS AND EXPENSES. Notwithstanding
anything herein to the contrary, any nonrecurring costs and expenses incurred
by the parties hereto to effect the transactions contemplated hereby which
are not allocated pursuant to the terms of the Separation Agreement, this
Agreement or any other Ancillary Agreement shall be the responsibility of the
party which incurs such costs and expenses. In particular, Coach and ▇▇▇▇ ▇▇▇
shall each be responsible for their own internal fees, costs and expenses
(e.g., salaries of personnel) incurred in connection with this Agreement.
Section 1.9 NOVATION OF ASSUMED COACH LIABILITIES.
(a) COMMERCIALLY REASONABLE EFFORTS. Each of ▇▇▇▇ ▇▇▇ and
Coach, at the request of the other, shall use its commercially reasonable
efforts to obtain, or to cause to be obtained, any consent, substitution,
approval or amendment required to novate or assign all rights and obligations
under agreements, leases, licenses and other obligations or Liabilities
(including Other Financial Liabilities) of any nature whatsoever that
constitute Coach Liabilities or to obtain in writing the unconditional
release of all parties to such arrangements other than any member of the
Coach Group, so that, in any such case, Coach and its Subsidiaries will be
solely responsible for such Liabilities.
(b) INABILITY TO OBTAIN NOVATION. If ▇▇▇▇ ▇▇▇ or Coach is
unable to obtain, or to cause to be obtained, any such required consent,
approval, release, substitution or amendment, the applicable member of the
▇▇▇▇ ▇▇▇ Group shall continue to be bound by such agreements, leases,
licenses and other obligations and, unless not permitted by law or the terms
thereof (except to the extent expressly set forth in this Agreement, the
Separation Agreement or any other Ancillary Agreement), Coach shall, as agent
or subcontractor for ▇▇▇▇ ▇▇▇ or such other Person, as the case may be, pay,
perform and discharge fully, or cause to be paid, transferred or discharged
all the obligations or other Liabilities of ▇▇▇▇ ▇▇▇ or such other Person, as
the case may be, thereunder from and after the date hereof. ▇▇▇▇ ▇▇▇ shall,
without further consideration, pay and remit, or cause to be paid or
remitted, to Coach or its appropriate Subsidiary promptly all money, rights
and other consideration received by it or any member of its respective Group
in respect of such performance (unless any such consideration is an Excluded
Asset). If and when any such consent, approval, release, substitution or
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amendment shall be obtained or such agreement, lease, license or other rights
or obligations shall otherwise become assignable or able to be novated, ▇▇▇▇
▇▇▇ shall thereafter assign, or cause to be assigned, all its rights,
obligations and other Liabilities thereunder or any rights or obligations of
any member of its respective Group to Coach without payment of further
consideration and Coach shall, without the payment of any further
consideration, assume such rights and obligations.
ARTICLE II
LITIGATION
Section 2.1 LITIGATION. Subject to, any contrary provision in the
Indemnifica tion and Insurance Matters Agreement, on the Separation Date, (a)
Coach shall have exclusive authority and control over the investigation,
prosecution, defense and appeal of all pending Actions solely relating to or
solely arising in connection with the Coach Business, the Coach Assets or the
Coach Liabilities (each a "Coach Action") and may settle or compromise, or
consent to the entry of any judgment with respect to any such Action, without
the consent of ▇▇▇▇ ▇▇▇, and (b) ▇▇▇▇ ▇▇▇ shall have exclusive authority and
control over the investigation, prosecution, defense and appeal of all
pending Actions solely relating to or solely arising in connection with the
▇▇▇▇ ▇▇▇ Business, the Excluded Assets or the Excluded Liabilities (each a
"▇▇▇▇ ▇▇▇ Action"), and may settle or compromise, or consent to the entry of
any judgment with respect to, any such Action without the consent of Coach;
PROVIDED, that if both Coach and ▇▇▇▇ ▇▇▇ are named as parties to any Coach
Action or ▇▇▇▇ ▇▇▇ Action that is not set forth on Schedule 2.1(a) or 2.1(b),
then ▇▇▇▇ ▇▇▇ and Coach must obtain the written consent of the other, such
consent not to be unreasonably withheld, to settle or compromise, or consent
to the entry of any judgment with respect to any such Action. Notwithstanding
any contrary provision in the Indemnification and Insurance Matters
Agreement, ▇▇▇▇ ▇▇▇ may, in its sole discretion have exclusive authority and
control over the investigation, prosecution, defense and appeal of all
pending Actions relating to or arising in connection with, in any manner
(other then solely with respect to or solely in connection with) the Coach
Business, the Coach Assets or the Coach Liabilities if ▇▇▇▇ ▇▇▇ or a member
of the ▇▇▇▇ ▇▇▇ Group is named as a party thereto; PROVIDED, HOWEVER, that
▇▇▇▇ ▇▇▇ must obtain the written consent of Coach, such consent not to be
unreasonably withheld, to settle or compromise or consent to the entry of
judgment with respect to such Action. After any such compromise, settlement,
consent to entry of judgment or entry of judgment, ▇▇▇▇ ▇▇▇ shall reasonably
and fairly allocate to Coach and Coach shall be responsible for Coach's
proportionate share of any such compromise, settlement, consent or judgment
attributable to the Coach Business, the Coach Assets
11
or the Coach Liabilities, including its proportionate share of the costs and
expenses associated with defending same. All other matters relating to such
claims, including, but not limited to, indemnification for such claims, shall
be governed by the provisions of the Indemnification and Insurance Matters
Agreement. Coach shall, and shall cause its Subsidiaries to, use commercially
reasonable efforts to have ▇▇▇▇ ▇▇▇ and any of its Subsidiaries removed as
parties to any Coach Action in which ▇▇▇▇ ▇▇▇ or any of its Subsidiaries are
named parties as soon as is reasonably practicable, and ▇▇▇▇ ▇▇▇ shall, and
shall cause its Subsidiaries to, use commercially reasonable efforts to have
Coach and any of its Subsidiaries removed as a party to any ▇▇▇▇ ▇▇▇ Action
in which it is a named party as soon as is reasonably practicable.
Section 2.2 COOPERATION. ▇▇▇▇ ▇▇▇ and is Subsidiaries and Coach and
its Subsidiaries shall cooperate with each other in the defense of any
litigation covered under this Article II and afford to each other reasonable
access upon reasonable advance notice to witnesses and Information (other
than Information protected from disclosure by applicable privileges) that is
reasonably required to defend this litigation (as "Information" is defined
pursuant to Section 7.33 of the Separation Agreement). The foregoing
agreement to cooperate includes, but is not limited to, an obligation to
provide access to qualified assistance to provide information, witnesses and
documents to respond to discovery requests in specific lawsuits. In such
cases, cooperation shall be timely so that the party responding to discovery
may meet all court-imposed deadlines. The party requesting information shall
reimburse the party providing information consistent with the terms of
Section 4.3 of the Separation Agreement. The obligations set forth in this
paragraph are more clearly defined in Section 4.3 of the Separation Agreement.
ARTICLE III
MISCELLANEOUS
Section 3.1 ENTIRE AGREEMENT. This Agreement, the Separation
Agreement, the other Ancillary Agreements and the Exhibits and Schedules
referenced or attached hereto and thereto, constitute the entire agreement
between the parties with respect to the subject matter hereof and shall
supersede all prior written and oral and all contemporaneous oral agreements
and understandings with respect to the subject matter hereof.
Section 3.2 GOVERNING LAW AND JURISDICTION. This Agreement shall be
construed in accordance with and all Disputes hereunder shall be governed by
the laws
12
of the State of Illinois, excluding its conflict of law rules. The parties
agree that the Circuit Court of ▇▇▇▇ County, Illinois and/or the United
States District Court for the Northern District of Illinois shall have
exclusive jurisdiction over all actions between the parties for preliminary
relief in aid of arbitration pursuant to Section 3.14 herein, and non
exclusive jurisdiction over any action for enforcement of an arbitral award.
Section 3.3 NOTICES. Notices, offers, requests or other
communications required or permitted to be given by either party pursuant to
the terms of this Agreement shall be given in writing to the respective
parties to the following addresses or facsimile numbers:
if to ▇▇▇▇ ▇▇▇:
▇▇▇▇ ▇▇▇ Corporation
Three First National Plaza
▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: General Counsel
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
13
if to Coach:
Coach, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address or facsimile number as the party to whom notice is
given may have previously furnished to the other in writing as provided
herein. Any notice involving non-performance, termination, or renewal shall
be sent by hand delivery, recognized overnight courier or, within the United
States, may also be sent via certified mail, return receipt requested. All
other notices may also be sent by facsimile, confirmed by first class mail.
All notices shall be deemed to have been given when received, if hand
delivered; when transmitted, if transmitted by facsimile or similar
electronic transmission method; one working day after it is sent, if sent by
recognized overnight courier; and three days after it is postmarked, if
mailed first class mail or certified mail, return receipt requested, with
postage prepaid.
Section 3.4 TERMINATION. This Agreement, the Separation Agreement
and all Ancillary Agreements may be terminated at any time prior to the IPO
Closing Date by and in the sole discretion of ▇▇▇▇ ▇▇▇ without the approval
of Coach and, if so terminated, all transactions taken in connection herewith
shall be void. This Agreement may be terminated at any time after the IPO
Closing Date and before the Distribution Date by mutual consent of ▇▇▇▇ ▇▇▇
and Coach. In the event of termination pursuant to this Section 3.4, no party
shall have any liability of any kind to the other party.
Section 3.5 PARTIES IN INTEREST. This Agreement, including the
Exhibits and Schedules hereto, and the other documents referred to herein,
shall be binding upon and inure solely to the benefit of each party hereto
and their legal representatives and successors, and nothing in this
Agreement, express or implied, is intended to confer upon any other Person
any rights or remedies of any nature whatsoever under or by reason of this
Agreement.
Section 3.6 COUNTERPARTS. This Agreement, including the Exhibits and
Schedules hereto, and the other documents referred to herein, may be executed
in counterparts, each of which shall be deemed to be an original but all of
which shall constitute one and the same agreement.
14
Section 3.7 ASSIGNMENT. This Agreement shall inure to the benefit of
and be binding upon the parties hereto and their respective legal
representatives and successors. This Agreement may not be assigned by any
party hereto, without the other party's express written consent.
Section 3.8 SEVERABILITY. If any term or other provision of this
Agreement or the Exhibits or Schedules attached hereto is determined by a
nonappealable decision by a court, administrative agency or arbitrator to be
invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any
manner materially adverse to any party. Upon such determination that any term
or other provision is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as
to effect the original intent of the parties as closely as possible in an
acceptable manner to the end that transactions contemplated hereby are
fulfilled to the fullest extent possible.
Section 3.9 FAILURE OR INDULGENCE NOT WAIVER; REMEDIES CUMULATIVE.
No failure or delay on the part of any party hereto in the exercise of any
right hereunder shall impair such right or be construed to be a waiver of, or
acquiescence in, any breach of any representation, warranty or agreement
herein, nor shall any single or partial exercise of any such right preclude
other or further exercise thereof or of any other right. All rights and
remedies existing under this Agreement or the Schedules or Exhibits attached
hereto are cumulative to, and not exclusive of, any rights or remedies
otherwise available.
Section 3.10 AMENDMENT. No change or amendment will be made to this
Agreement except by an instrument in writing signed on behalf of each of the
parties to such agreement.
Section 3.11 AUTHORITY. Each of the parties hereto represents to the
other that (a) it has the corporate or other requisite power and authority to
execute, deliver and perform this Agreement, (b) the execution, delivery and
performance of this Agreement by it have been duly authorized by all
necessary corporate or other action, (c) it has duly and validly executed and
delivered this Agreement, and (d) this Agreement is a legal, valid and
binding obligation, enforceable against it in accordance with its terms
subject to applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting creditors' rights generally and general equity
principles.
15
Section 3.12 INTERPRETATION. The headings contained in this
Agreement, in any Exhibit or Schedule hereto and in the table of contents to
this Agreement are for reference purposes only and shall not affect in any
way the meaning or interpretation of this Agreement. Any capitalized term
used in any Schedule or Exhibit but not otherwise defined therein, shall have
the meaning assigned to such term in this Agreement. When a reference is made
in this Agreement to an Article or a Section, Exhibit or Schedule, such
reference shall be to an Article or Section of, or an Exhibit or Schedule to,
this Agreement unless otherwise indicated.
Section 3.13 CONFLICTING AGREEMENTS. In the event of conflict
between this Agreement and any other Ancillary Agreement or other agreement
executed in connection herewith, the provisions of such other agreement shall
prevail (other than (a) as otherwise provided herein and (b) as provided in
the Separation Agreement).
Section 3.14 DISPUTE RESOLUTION.
(a) Any dispute, controversy or claim arising out of or
relating to this Agreement or the Ancillary Agreements or the breach,
termination or validity thereof ("Dispute") which arises between the parties
shall first be negotiated between appropriate senior executives of each party
who shall have the authority to resolve the matter. Such executives shall
meet to attempt in good faith to negotiate a resolution of the Dispute prior
to pursuing other available remedies, within 10 days of receipt by a party of
notice of a dispute, which date of receipt 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 in any subsequent
proceeding between the parties. If the senior executives are unable to
resolve the Dispute within thirty (30) days from the Dispute Resolution
Commencement Date, then, on the request of any party, the Dispute will be
mediated by a mediator appointed pursuant to the mediation rules of the
American Arbitration Association ("AAA"). Both parties will share the
administrative costs of the mediation and the mediator's fees and expenses
equally, and each party shall bear all of its other costs and expenses
related to the mediation, including but not limited to attorney's fees,
witness fees, and travel expenses. The mediation shall take place in ▇▇▇▇
County Illinois or in whatever alternative forum on which the parties may
agree.
(b) Any Dispute which the parties cannot resolve through
mediation within forty-five days of the appointment of the mediator, shall at
the request of any party be submitted to final and binding arbitration under
the then current Commercial
16
Arbitration Rules of the AAA in ▇▇▇▇ County, Illinois. There shall be three
(3) neutral arbitrators of whom ▇▇▇▇ ▇▇▇ shall appoint one and Coach shall
appoint one within 30 days of the receipt by the respondent of the demand for
arbitration. The two arbitrators so appointed shall select the chair of the
arbitral tribunal within 30 days of the appointment of the second arbitrator.
If any arbitrator is not appointed within the time limit provided herein,
such arbitrator shall be appointed by the AAA by using a list striking and
ranking procedure in accordance with the Rules. Any arbitrator appointed by
the AAA shall be a retired judge or a practicing attorney with no less than
fifteen years of experience and an experienced arbitrator. The prevailing
party in such arbitration shall be entitled to be awarded its expenses,
including its share of administrative and arbitrator fees and expenses 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 arbitrators shall be final and
binding on the parties and may be enforced in any court of competent
jurisdiction.
(c) By agreeing to arbitration, the parties do not intend to
deprive any court of its jurisdiction to issue a pre-arbitral injunction,
pre-arbitral attachment, or other order in aid of arbitration proceedings and
the enforcement of any award. Without prejudice to such provisional remedies
as may be available under the jurisdiction of a court, the arbitral tribunal
shall have full authority to grant provisional remedies or modify or vacate
any temporary or preliminary relief issued by a court, to issue an award for
temporary or permanent injunctive relief (including specific performance) and
to award damages for the failure of any party to respect the arbitral
tribunal's orders to that effect.
ARTICLE IV
DEFINITIONS
Section 4.1 AAA. "AAA" has the meaning set forth in Section 3.14(a)
of this Agreement.
Section 4.2 ACTION. "Action" means any demand, action, suit,
countersuit, arbitration, inquiry, proceeding or investigation by or before
any federal, state, local, foreign or international governmental authority or
any arbitration or mediation tribunal, other than any demand, action, suit,
countersuit, arbitration, inquiry, proceeding or investigation relating to
Taxes.
17
Section 4.3 AFFILIATED COMPANY. "Affiliated Company" of any Person
means a Person that controls, is controlled by, or is under common control
with such Person. As used herein, "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management
and policies of such entity, whether through ownership of voting securities
or other interests, by contract or otherwise.
Section 4.4 ANCILLARY AGREEMENT. "Ancillary Agreement" has the
meaning set forth in the Separation Agreement.
Section 4.5 ASSETS. "Assets" means assets, properties and rights
(including goodwill), wherever located (including in the possession of
vendors or other third parties or elsewhere), whether real, personal or
mixed, tangible, intangible or contingent, in each case whether or not
recorded or reflected or required to be recorded or reflected on the books
and records or financial statements of any Person, including the following:
(i) all accounting and other books, records and files
whether in paper, microfilm, microfiche, computer tape or disc, magnetic
tape or any other form;
(ii) all computers and other electronic data processing
equipment, fixtures, machinery, equipment, furniture, office equipment,
motor vehicles and other transportation equipment, special and general
tools, prototypes and models and other tangible personal property;
(iii) all inventories of materials, parts, raw materials,
supplies, work-in-process and finished goods and products;
(iv) all interests in real property of whatever nature,
including easements, whether as owner, mortgagee or holder of a Security
Interest, lessor, sublessor, lessee, sublessee or otherwise;
(v) all interests in any capital stock or other equity
interests of any Subsidiary or any other Person; all bonds, notes,
debentures or other securities issued by any Subsidiary or any other
Person; all loans, advances or other extensions of credit or capital
contributions to any Subsidiary or any other Person; and all other
investments in securities of any Person;
18
(vi) all license agreements, leases of personal property,
open purchase orders for raw materials, supplies, parts or services,
unfilled orders for the manufacture and sale of products and other
contracts, agreements or commitments;
(vii) all deposits, letters of credit and performance and
surety bonds;
(viii) all written technical information, data, specifica
tions, research and development information, engineering drawings,
operating and maintenance manuals, and materials and analyses prepared
by consultants and other third parties;
(ix) all Intellectual Property and licenses from third
Persons granting the right to use any Intellectual Property;
(x) all computer applications, programs and other
software, including operating software, network software, firmware,
middleware, design software, design tools, systems documentation and
instructions;
(xi) all cost information, sales and pricing data,
customer prospect lists, supplier records, customer and supplier lists,
customer and vendor data, correspondence and lists, product literature,
artwork, design, development and manufacturing files, vendor and
customer drawings, formulations and specifications, quality records and
reports and other books, records, studies, surveys, reports, plans and
documents;
(xii) all prepaid expenses, trade accounts and other
accounts and notes receivables;
(xiii) all rights under contracts or agreements, all
claims or rights against any Person arising from the ownership of any
Asset, all rights in connection with any bids or offers and all claims,
choses in action or similar rights, whether accrued or contingent;
(xiv) all rights under insurance policies and all rights
in the nature of insurance, indemnification or contribution;
19
(xv) all licenses (including radio and similar licenses),
permits, approvals and authorizations which have been issued by any
Governmental Authority;
(xvi) cash or cash equivalents, bank accounts, lock boxes
and other deposit arrangements; and
20
(xvii) interest rate, currency, commodity or other swap,
collar, cap or other hedging or similar agreements or arrangements.
Section 4.6 COACH AFFILIATE. "Coach Affiliate" means any corporation
or other entity directly or indirectly Controlled by Coach.
Section 4.7 COACH ASSETS. "Coach Assets" has the meaning set forth
in Section 1.2(a) of this Agreement.
Section 4.8 COACH BALANCE SHEET. "Coach Balance Sheet" means the
audited balance sheet (including the notes thereto) of the Coach Business as
of July 1, 2000 that is included in the IPO Registration Statement.
Section 4.9 COACH BUSINESS. "Coach Business" means the business and
operations of the business of Coach as described in the IPO Registration
Statement and, except as otherwise expressly provided herein, any terminated,
divested or discontinued businesses or operations that at the time of
termination, divestiture or discontinuation primarily related to the Coach
Business as then conducted.
Section 4.10 COACH CONTINGENT GAIN. "Coach Contingent Gain" means
any claim or other right of a member of the ▇▇▇▇ ▇▇▇ Group or the Coach Group
that substantially or exclusively relates to the Coach Business, whenever
arising, against any Person other than a member of the ▇▇▇▇ ▇▇▇ Group or the
Coach Group, if and to the extent that (i) such claim or right arises out of
the events, acts or omissions occurring as of or before the Separation Date
(based on then existing law) and (ii) the existence or scope of the
obligation of such other Person as of the Separation Date was not
acknowledged, fixed or determined in any material respect, due to a dispute
or other uncertainty as of the Separation Date or as a result of the failure
of such claim or other right to have been discovered or asserted as of the
Separation Date. A claim or right meeting the foregoing definition shall be
considered a Coach Contingent Gain regardless of whether there was any Action
pending, threatened or contemplated as of the Separation Date with respect
thereto. In the case of any claim or right a portion of which arises out of
events, acts or omissions occurring prior to the Separation Date and a
portion of which arises out of events, acts or omissions occurring on or
after the Separation Date, only that portion that arises out of events, acts
or omissions occurring prior to the Separation Date shall be considered a
Coach Contingent Gain. For purposes of the foregoing, a claim or right shall
be deemed to have accrued as of the Separation Date if all the elements of
the claim necessary for its assertion shall have occurred on
21
or prior to the Separation Date, such that the claim or right, were it
asserted in an Action on or prior to the Separation Date, would not be
dismissed by a court on ripeness or similar grounds. Notwithstanding the
foregoing, none of (i) any Insurance Proceeds, (ii) any Excluded Assets,
(iii) any reversal of any litigation or other reserve, except to the extent
that such reversal or reserve directly relates to Coach Liabilities, or (iv)
any matters relating to Taxes (which are governed solely by the Tax Sharing
Agreement) shall be deemed to be a Coach Contingent Gain.
Section 4.11 COACH CONTINGENT LIABILITY. "Coach Contingent
Liability" means any Liability, other than Liabilities for Taxes (which are
governed solely by the Tax Sharing Agreement), of a member of the ▇▇▇▇ ▇▇▇
Group or the Coach Group that substantially or exclusively relates to the
Coach Business, whenever arising, to any Person other than a member of the
▇▇▇▇ ▇▇▇ Group or the Coach Group, if and to the extent that (i) such
Liability arises out of the events, acts or omissions occurring as of or
before the Separation Date and (ii) the existence or scope of the obligation
of a member of the ▇▇▇▇ ▇▇▇ Group or the Coach Group as of the Separation
Date with respect to such Liability was not acknowledged, fixed or determined
in any material respect, due to a dispute or other uncertainty as of the
Separation Date or as a result of the failure of such Liability to have been
discovered or asserted as of the Separation Date (it being understood that
the existence of a litigation or other reserve with respect to any Liability
shall not be sufficient for such Liability to be considered acknowledged,
fixed or determined). In the case of any Liability a portion of which arises
out of events, acts or omissions occurring prior to the Separation Date and a
portion of which arises out of events, acts or omissions occurring on or
after the Separation Date, only that portion that arises out of events, acts
or omissions occurring prior to the Separation Date shall be considered a
Coach Contingent Liability. For purposes of the foregoing, a Liability shall
be deemed to have arisen out of events, acts or omissions occurring prior to
the Separation Date if all the elements necessary for the assertion of a
claim with respect to such Liability shall have occurred on or prior to the
Separation Date, such that the claim, were it asserted in an Action on or
prior to the Separation Date, would not be dismissed by a court on ripeness
or similar grounds. For purposes of clarification of the foregoing, the
parties agree that no Liability relating to, arising out of or resulting from
any obligation of any Person to perform the executory portion of any contract
or agreement existing as of the Separation Date, or to satisfy any obligation
accrued under any Plan (as defined in the Employee Matters Agreement) as of
the Separation Date, shall be deemed to be a Coach Contingent Liability.
Section 4.12 COACH CONTRACTS. "Coach Contracts" means the following
contracts and agreements to which ▇▇▇▇ ▇▇▇ or any of its Subsidiaries is a
party or by
22
which it or any of its Assets is bound, whether or not in writing, except for
any such contract or agreement that is contemplated to be retained by ▇▇▇▇
▇▇▇ or any member of the ▇▇▇▇ ▇▇▇ Group pursuant to any provision of this
Agreement or any other Ancillary Agreement:
(i) any contract or agreement entered into in the
name of, or expressly on behalf of, the Coach Business;
(ii) any contract or agreement that relates substan tially
or exclusively to the Coach Business;
(iii) any contract or agreement that is otherwise
expressly contemplated pursuant to this Agreement, the Separation
Agreement or any of the other Ancillary Agreements to be assigned to
Coach;
(iv) any guarantee, indemnity, representation, warranty or
other Liability of any member of the Coach Group or the ▇▇▇▇ ▇▇▇ Group
in respect of any other Coach Contract, any Coach Liability or the Coach
Business (including guarantees of financing incurred by customers or
other third parties in connection with purchases of products or services
from the Coach Business); and
(v) any Other Financial Liability exclusively for or on
behalf of the Coach Business.
Section 4.13 COACH GROUP. "Coach Group" means the Affiliated Group,
or similar group of entities as defined under corresponding provisions of the
laws of other jurisdictions, of which Coach will be the common parent
corporation immediately after the Distribution, and any corporation or other
entity which may become a member of such group from time to time.
Section 4.14 COACH LIABILITIES. "Coach Liabilities" has the meaning
set forth in Section 1.3(a) of this Agreement.
Section 4.15 COACH PRO FORMA BALANCE SHEET. "Coach Pro Forma Balance
Sheet" means the unaudited pro forma balance sheet (or, if applicable, the
unaudited pro forma as adjusted balance sheet) for the fiscal year ending
July 1, 2000 appearing in the IPO Registration Statement.
23
Section 4.16 CONSENTS. "Consents" means any consents, waivers or
approvals from, or notification requirements to, any third parties.
24
Section 4.17 CONTRACTS. "Contracts" means any contract, agreement,
lease, license, sales order, purchase order, instrument or other commitment
that is binding on any Person or any part of its property under applicable
law.
Section 4.18 DELAYED TRANSFER ASSETS. "Delayed Transfer Assets"
means any Coach Assets that are expressly provided in this Agreement, the
Separation Agreement or any other Ancillary Agreement to be transferred after
the date of this Agreement.
Section 4.19 DELAYED TRANSFER LIABILITIES. "Delayed Transfer
Liabilities" means any Coach Liabilities that are expressly provided in this
Agreement, the Separation Agreement or any other Ancillary Agreement to be
transferred after the date of this Agreement.
Section 4.20 DISPUTE. "Dispute" has the meaning set forth in Section
3.14(a) of this Agreement.
Section 4.21 DISPUTE RESOLUTION COMMENCEMENT DATE. "Dispute
Resolution Commencement Date" has the meaning set forth in Section 3.14(a) of
this Agreement.
Section 4.22 DISTRIBUTION. A "Distribution" means the divestiture by
▇▇▇▇ ▇▇▇ of all or a significant portion of the shares of capital stock of
Coach owned by ▇▇▇▇ ▇▇▇, which divestiture may be effected by ▇▇▇▇ ▇▇▇ as a
dividend, an exchange with existing ▇▇▇▇ ▇▇▇ stockholders for shares of ▇▇▇▇
▇▇▇ capital stock, a spin-off or otherwise, as a result of which ▇▇▇▇ ▇▇▇ is
no longer required to consolidate Coach's results of operations and financial
position (determined in accordance with generally accepted accounting
principles consistently applied).
Section 4.23 DISTRIBUTION DATE. "Distribution Date" means the date
on which a Distribution is consummated.
Section 4.24 EXCLUDED ASSETS. "Excluded Assets" has the meaning set
forth in Section 1.2(b) of this Agreement.
Section 4.25 EXCLUDED LIABILITIES. "Excluded Liabilities" has the
meaning set forth in Section 1.3(b) of this Agreement.
Section 4.26 GOVERNMENTAL APPROVALS. "Governmental Approvals" means
any
25
notices, reports or other filings to be made, or any consents, registrations,
approvals, permits or authorizations to be obtained from, any Governmental
Authority.
Section 4.27 GOVERNMENTAL AUTHORITY. "Governmental Authority" means
any federal, state, local, foreign or international court, government,
department, commis sion, board, bureau, agency, official or other regulatory,
administrative or governmental authority.
Section 4.28 INDEMNIFICATION AND INSURANCE MATTERS AGREEMENT.
"Indemnifica tion and Insurance Matters Agreement" means the Indemnification
and Insurance Matters Agreement attached as Exhibit J to the Separation
Agreement.
Section 4.29 INSURANCE POLICIES. "Insurance Policies" means
insurance policies pursuant to which a Person makes a true risk transfer to
an insurer.
Section 4.30 INSURANCE PROCEEDS. "Insurance Proceeds" means those
monies:
(a) received by an insured from an insurance carrier; or
(b) paid by an insurance carrier on behalf of the insured;
(c) from Insurance Policies.
Section 4.31 INSURED COACH LIABILITIES. "Insured Coach Liabilities"
means any Coach Liability to the extent that (i) it is covered under the terms
of ▇▇▇▇ ▇▇▇'▇ Insurance Policies in effect prior to the Distribution Date and
(ii) Coach is not a named insured under, or otherwise entitled to the benefits
of, such Insurance Policies.
Section 4.32 INTELLECTUAL PROPERTY. "Intellectual Property" means
all domestic and foreign patents and patent applications, together with any
continuations, continuations-in-part or divisional applications thereof, and
all patents issuing thereon (including reissues, renewals and re-examinations
of the foregoing); design patents, invention disclosures; mask works;
copyrights, and copyright applications and registrations; Web addresses,
trademarks, service marks, trade names, and trade dress, in each case
together with any applications and registrations therefor and all appurtenant
goodwill relating thereto; trade secrets, commercial and technical
information, know-how, proprietary or confidential information, including
engineering, production and other designs, notebooks, processes, drawings,
specifications, formulae, and technology; computer and electronic data
processing programs and software (object and source
26
code), data bases and documentation thereof; inventions (whether patented or
not); utility models; registered designs, certificates of invention and all
other intellectual property under the laws of any country throughout the
world.
Section 4.33 IPO. "IPO" means Coach's initial public offering of
common stock.
Section 4.34 IPO CLOSING DATE. "IPO Closing Date" has the meaning
set forth in the Separation Agreement.
Section 4.35 IPO REGISTRATION STATEMENT. "IPO Registration
Statement" means the registration statement on Form S-1 pursuant to the
Securities Act of 1933, as amended, to be filed with the Securities and
Exchange Commission registering the shares of common stock of Coach to be
issued in the initial public offering, together with all amendments thereto.
Section 4.36 LIABILITIES. "Liabilities" means all debts,
liabilities, guarantees, assurances, commitments and obligations, whether
fixed, contingent or absolute, asserted or unasserted, matured or unmatured,
liquidated or unliquidated, accrued or not accrued, known or unknown, due or
to become due, whenever or however arising (including, without limitation,
whether arising out of any Contract or tort based on negligence or strict
liability) and whether or not the same would be required by generally
accepted principles and accounting policies to be reflected in financial
statements or disclosed in the notes thereto.
Section 4.37 OTHER FINANCIAL LIABILITIES. "Other Financial
Liabilities" means all liabilities, obligations, contingencies, instruments
and other Liabilities of any member of the ▇▇▇▇ ▇▇▇ Group of a financial
nature with third parties existing on the date hereof or entered into or
established between the date hereof and the Separation Date, including any of
the following:
(a) foreign exchange contracts;
(b) letters of credit;
(c) guarantees of third party loans to customers;
(d) surety bonds (excluding surety for workers' compensation
self-insurance);
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(e) interest support agreements on third party loans to
customers;
(f) performance bonds or guarantees issued by third parties;
(g) swaps or other derivatives contracts; and
(h) recourse arrangements on the sale of receivables or
notes.
Section 4.38 PERSON. "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.
Section 4.39 REAL ESTATE MATTERS AGREEMENT. "Real Estate Matters
Agree ment" means the Real Estate Matters Agreement, attached as Exhibit G to
the Separation Agreement.
Section 4.40 ▇▇▇▇ ▇▇▇ AFFILIATE. "▇▇▇▇ ▇▇▇ Affiliate" means any
corporation or other entity directly or indirectly Controlled by ▇▇▇▇ ▇▇▇,
but excluding Coach and any Coach Affiliate.
Section 4.41 ▇▇▇▇ ▇▇▇ GROUP. "▇▇▇▇ ▇▇▇ Group" means the Affiliated
Group, or similar group of entities as defined under corresponding provisions
of the laws of other jurisdictions, of which ▇▇▇▇ ▇▇▇ is the common parent
corporation, and any corporation or other entity which may be, may have been
or may become a member of such group from time to time, but excluding any
member of the Coach Group.
Section 4.42 SECURITY INTEREST. "Security Interest" means any
mortgage, security interest, pledge, lien, charge, claim, option, right to
acquire, voting or other restriction, right-of-way, covenant, condition,
easement, encroachment, restriction on transfer, or other encumbrance of any
nature whatsoever.
Section 4.43 SEPARATION. "Separation" has the meaning set forth in
the preamble to the Separation Agreement.
Section 4.44 SEPARATION AGREEMENT. "Separation Agreement" has the
meaning set forth in the preamble to this Agreement.
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Section 4.45 SEPARATION DATE. "Separation Date" means the effective
date and time of each transfer of property, assumption of liability, license,
undertaking, or agreement in connection with the Separation, which shall be
12:01 a.m., Central Time, on the date that is two days prior to the date the
IPO Registration Statement is declared effective or such date as may be fixed
by the Board of Directors of ▇▇▇▇ ▇▇▇.
Section 4.46 SHARED CONTRACT. "Shared Contract" means Contracts with
third parties which directly benefit both ▇▇▇▇ ▇▇▇ or a member of the ▇▇▇▇
▇▇▇ Group or Coach or a member of the Coach Group.
Section 4.47 SHARED CONTRACTUAL LIABILITIES. "Shared Contractual
Liabilities" means Liabilities with respect to Shared Contracts.
Section 4.48 SUBSIDIARY. "Subsidiary" of any Person means any
corporation or other organization whether incorporated or unincorporated of
which at least a majority of the securities or interest 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.
Section 4.49 TAX SHARING AGREEMENT. "Tax Sharing Agreement" means
the Tax Sharing Agreement, attached as Exhibit E to the Separation Agreement.
Section 4.50 TAXES. "Taxes" has the meaning set forth in the Tax
Sharing Agreement.
* * *
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WHEREFORE, the parties have signed this General Assignment and
Assumption Agreement effective as of the date first set forth above.
▇▇▇▇ ▇▇▇ CORPORATION
-------------------------
Name:
Title:
COACH, INC.
-------------------------
Name:
Title:
Schedule 1.1(c)
Delayed Transfer Assets and Liabilities
1. VAT receivable of $200,000.
2. All of the outstanding capital stock of Coach Europe Services S.r.l. and
Coach U.K. Ltd.