Document:

Exhibit 10.4

 

TRANSITIONAL TRADEMARK LICENSE AGREEMENT

 

BY AND BETWEEN

 

JOHNSON CONTROLS PLC

 

AND

 

ADIENT PLC

 

DATED AS OF [·], 2016

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    
	
ARTICLE 1   — DEFINITIONS
    	
1
    
	
 
    	
 
    
	
Section 1.1
    	
Definitions
    	
1
    
	
 
    	
 
    	
 
    
	
ARTICLE 2   — GRANT OF LICENSE
    	
3
    
	
 
    	
 
    	
 
    
	
Section 2.1
    	
Grant of License
    	
3
    
	
Section 2.2
    	
Disclaimer
    	
4
    
	
Section 2.3
    	
Transitional License
    	
4
    
	
Section 2.4
    	
Fair Use
    	
5
    
	
Section 2.5
    	
Reservation of Rights
    	
5
    
	
 
    	
 
    	
 
    
	
ARTICLE 3   — QUALITY CONTROL/OWNERSHIP
    	
5
    
	
 
    	
 
    	
 
    
	
Section 3.1
    	
Quality Control
    	
5
    
	
Section 3.2
    	
Compliance with Laws
    	
5
    
	
Section 3.3
    	
Ownership/No Contest
    	
5
    
	
Section 3.4
    	
Enforcement
    	
6
    
	
Section 3.5
    	
Cooperation
    	
6
    
	
 
    	
 
    	
 
    
	
ARTICLE 4   — TERM AND TERMINATION/SURVIVAL
    	
6
    
	
 
    	
 
    	
 
    
	
Section 4.1
    	
Term
    	
6
    
	
Section 4.2
    	
Termination
    	
6
    
	
Section 4.3
    	
Survival
    	
7
    
	
 
    	
 
    	
 
    
	
ARTICLE 5   — REPRESENTATIONS, WARRANTIES AND INDEMNIFICATION
    	
7
    
	
 
    	
 
    	
 
    
	
Section 5.1
    	
By Each Party
    	
7
    
	
Section 5.2
    	
Disclaimer
    	
7
    
	
 
    	
 
    	
 
    
	
ARTICLE 6   — MISCELLANEOUS
    	
7
    
	
 
    	
 
    	
 
    
	
Section 6.1
    	
Assignment
    	
7
    
	
Section 6.2
    	
Notices
    	
8
    
	
Section 6.3
    	
Dispute Resolution
    	
9
    
	
Section 6.4
    	
Performance
    	
9
    
	
Section 6.5
    	
Amendments
    	
9
    
	
Section 6.6
    	
Incorporation by   Reference
    	
10
    

 

Schedule A — Johnson Controls Marks

Schedule B — Maximum License Terms for Specified Materials

Schedule C — Adient Disclaimer

 

i

 

TRANSITIONAL TRADEMARK LICENSE AGREEMENT

 

This TRANSITIONAL TRADEMARK LICENSE AGREEMENT (this “Agreement”), dated as of [·], 2016, by and between JOHNSON CONTROLS PLC, a public limited company organized under the laws of Ireland (“Johnson Controls”), and ADIENT PLC, a public limited company organized under the laws of England and Wales (“Adient” and together with Johnson Controls, the “Parties”).

 

WHEREAS, the board of directors of Johnson Controls (the “Johnson Controls Board”) has determined that it is in the best interests of Johnson Controls and its shareholders to create a new publicly traded company that shall operate the Adient Business;

 

WHEREAS, in furtherance of the foregoing, the Johnson Controls Board has determined that it is appropriate and desirable to separate the Adient Business from the Johnson Controls Business (the “Separation”) and, following the Separation, for Adient to issue ordinary shares to holders of Johnson Controls Shares on the Record Date, pro rata to their respective holdings (the “Distribution”);

 

WHEREAS, in order to effectuate the Separation and Distribution, Johnson Controls and Adient have entered into a Separation and Distribution Agreement, dated as of [·], 2016 (the “Separation and Distribution Agreement”);

 

WHEREAS, Johnson Controls or other members of the Johnson Controls Group are the owners of the trademarks set forth on Schedule A to this Agreement (in block letters or otherwise) and all other trademarks incorporating the trademarks set forth on Schedule A, as well as any and all translations and transliterations of these trademarks (collectively, the “Johnson Controls Marks”); and

 

WHEREAS, Adient and the other members of the Adient Group desire to receive (and Johnson Controls is willing to grant the Adient Group) certain rights under the Johnson Controls Marks for a transitional period beginning as of the Effective Time, on the terms and subject to the conditions set forth in this Agreement.

 

NOW, THEREFORE, in consideration of the promises and of the mutual covenants and agreements herein contained, and for good and valuable consideration, including that recited in the Separation and Distribution Agreement, the receipt and adequacy of which is acknowledged by the Parties, the Parties agree as follows:

 

ARTICLE 1 — DEFINITIONS

 

Section 1.1                                    Definitions.  For purposes of this Agreement, the following terms shall have the following meanings:

 

“Acceptable Use Guidelines” has the meaning set forth in Section 3.1.

 

“Action” has the meaning set forth in the Separation and Distribution Agreement.

 

“Adient” has the meaning set forth in the Preamble.

 

 

“Adient Business” has the meaning set forth in the Separation and Distribution Agreement.

 

“Adient Website” has the meaning set forth in Section 2.1(b).

 

“Affiliate” has the meaning set forth in the Separation and Distribution Agreement.

 

“Agreement” has the meaning set forth in the Preamble.

 

“Ancillary Agreements” has the meaning set forth in the Separation and Distribution Agreement.

 

“Branded Materials” has the meaning set forth in Section 2.1(c).

 

“Dispute” has the meaning set forth in the Separation and Distribution Agreement.

 

“Distribution” has the meaning set forth in the Recitals.

 

“Effective Time” has the meaning set forth in the Separation and Distribution Agreement.

 

“Group” has the meaning set forth in the Separation and Distribution Agreement.

 

“Johnson Controls” has the meaning set forth in the Preamble.

 

“Johnson Controls Board” has the meaning set forth in the Recitals.

 

“Johnson Controls Business” has the meaning set forth in the Separation and Distribution Agreement.

 

“Johnson Controls Marks” has the meaning set forth in the Recitals.

 

“Law” has the meaning set forth in the Separation and Distribution Agreement.

 

“Legacy Entity Name” has the meaning set forth in Section 2.1(a).

 

“Party” or “Parties” shall mean the parties to this Agreement.

 

“Person” has the meaning set forth in the Separation and Distribution Agreement.

 

“Pre-Existing Affiliate Contract” has the meaning set forth in Section 6.4.

 

“Record Date” has the meaning set forth in the Separation and Distribution Agreement.

 

“Separation” has the meaning set forth in the Recitals.

 

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“Separation and Distribution Agreement” has the meaning set forth in the Recitals.

 

“Subsidiary” or “Subsidiaries” has the meaning set forth in the Separation and Distribution Agreement.

 

“Term” has the meaning set forth in Section 4.1.

 

“Third Party” shall mean any Person other than the Parties or any of their Affiliates.

 

“Third Party Claim” shall mean any claim asserted or any Action commenced by any Third Party against any Party or any of its Affiliates.

 

“Transition Committee” has the meaning set forth in the Separation and Distribution Agreement.

 

ARTICLE 2 — GRANT OF LICENSE

 

Section 2.1                                    Grant of License.  Subject to the terms and conditions herein, Johnson Controls, on behalf of itself and the other members of the Johnson Controls Group, grants to Adient and the Adient Affiliates a non-exclusive, worldwide, fully paid-up, non-assignable (subject to Section 6.1), and non-sublicenseable license to use the Johnson Controls Marks solely in connection with the operation, advertisement, marketing, promotion and support of the Adient Business in a manner consistent with Adient and the Adient Affiliates’ use of the Johnson Controls Marks as of the Effective Time, solely as follows and solely for the time periods below:

 

(a)                                 Adient Affiliates must remove (or cause to be removed) all uses of Johnson Controls Marks from their corporate or entity names (a “Legacy Entity Name”) within one hundred and eighty (180) days after the Effective Time; provided, that if an Adient Affiliate is (i) unable to obtain the requisite consents or approvals required under applicable Law, such Affiliate’s organizational documents or any contract with a Third Party necessary to change its Legacy Entity Name in a jurisdiction to a new corporate or entity name that does not include the Johnson Controls Marks, or (ii) is unable for regulatory reasons to adopt in a jurisdiction a new corporate or entity name that does not include the Johnson Controls Marks, such Affiliate shall be permitted to continue its then-current use of its Legacy Entity Name until the earlier of (i) the date the requisite consents or approvals are obtained; and (ii) the date that is two (2) years after the Effective Time; provided, that such Affiliate complies, in good faith, with the obligations contained in this Agreement;

 

(b)                                 Adient and its Affiliates must remove (or cause to be removed) all uses of Johnson Controls Marks from (i) www.adient.com within thirty (30) days after the Effective Time and (ii) any other websites and social media site that are promoted to third parties and under Adient’s or its Affiliates’ possession or control (each website or social media sites described in clause (i) or (ii), an “Adient Website”) within one hundred and eighty (180) days after any Adient employee with the title of “Vice President” or above becomes aware of the use of Johnson Controls Marks on such Adient Website (or such longer period required by applicable

 

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Law, if the Adient Website is operated by an Adient Affiliate that is continuing to use a Legacy Entity Name in accordance with this Agreement);

 

(c)                                  After the Effective Time, Adient and its Affiliates must (i) not create any new personal property, consumable materials, product packaging or other similar items (“Branded Materials”) bearing the Johnson Controls Marks; and (ii) cease commercial use of any such Branded Materials within Adient’s or its Affiliates’ possession and in existence as of the Effective Time within the time periods set forth in Schedule B to this Agreement corresponding to each item on such Schedule (in each case of clauses (i) and (ii), except as required by applicable Law, if the Branded Materials include the name of an Adient Affiliate that is continuing to use a Legacy Entity Name in accordance with this Agreement);

 

(d)                                 Adient and its Affiliates must remove (or cause to be removed) all Johnson Controls Marks from: (i) substantially permanent building signage (including etched glass, engraved marble and the like) that is visible to third parties and (A) under Adient’s or its Subsidiaries’ possession or control within one hundred and eighty (180) days after the Effective Time, or (B) under the possession or control of an Adient Affiliate that is not a member of the Adient Group, within two (2) years after the Effective Time; (ii) uniforms that are visible to third parties and under Adient’s or its Affiliates’ possession or control within one hundred and eight (180) days after the Effective Time; and (iii) any substantially permanent building signage that is not visible to third parties and any other items set forth on Schedule B that are identified as “Other Items” on such Schedule and are under Adient’s or its Affiliates’ possession or control when such items are replaced in the ordinary course of business; and

 

(e)                                  Adient and its Affiliates must cease all other uses of the Johnson Controls Marks (i) on items that are visible to third parties within two (2) years after the Effective Time and (ii) items that are not visible to third parties when such items are replaced in the ordinary course of business (or, in each case, as otherwise mutually agreed in writing by the Parties).

 

The Parties agree that notwithstanding the foregoing or any other provision of this Agreement, nothing in this Agreement shall constitute a grant of a license to use the Johnson Controls Marks by any Adient Affiliate that (x) is not a member of the Adient Group, and (y) does not have a license or other right to use the Johnson Controls Marks as of immediately prior to the Effective Time.

 

Section 2.2                                    Disclaimer.  Adient and its Affiliates shall post a disclaimer in the form set forth on Schedule C on (a) www.adient.com within thirty (30) days after the Effective Time; and (b) all other Adient Websites within one hundred and eighty (180) days after Adient becomes aware of the use of Johnson Controls Marks on such Adient Website, informing such third parties that as of the Effective Time and thereafter, Adient, and not Johnson Controls, is responsible for the operation of the Adient Business, including such Adient Website.  Each disclaimer may be removed from an Adient Website at the time that the Jonson Controls Marks are removed from such Adient Website.

 

Section 2.3                                    Transitional License.  Adient, on behalf of itself and its Affiliates, acknowledges that the licenses in Section 2.1 are transitional in nature, and that Adient and its

 

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Affiliates shall use commercially reasonable efforts to transition away from all uses of the Johnson Controls Marks promptly after the Effective Time.

 

Section 2.4                                    Fair Use.  Notwithstanding anything in this Agreement to the contrary, Adient and its Affiliates may (a) use the Johnson Controls Marks at all times after the Effective Time (i) in a neutral, non-trademark use to describe the history of their business (including any nominations, awards or similar recognition received by such business); and (ii) as required or permitted by applicable Law, and (b) use the Johnson Controls Marks on (i) archival copies of legal documents, business correspondence and similar items; and (ii) hard copy corporate documents and other materials describing the operations of Adient and its Affiliates’ businesses; provided, that such materials shall not reasonably suggest or convey that Adient or its Affiliates is offering goods or services under the Johnson Controls Marks.

 

Section 2.5                                    Reservation of Rights.  All rights in the Johnson Controls Marks not expressly granted to Adient or its Affiliates pursuant to this Agreement are reserved to Johnson Controls.

 

ARTICLE 3 — QUALITY CONTROL/OWNERSHIP

 

Section 3.1                                    Quality Control.  Adient shall use the Johnson Controls Marks solely in accordance with the style and trademark usage guidelines for the Johnson Controls Marks in effect as of the Effective Time (the “Acceptable Use Guidelines”).  It is agreed that Adient’s use of the Johnson Controls Marks as of the Effective Time shall be deemed to comply with the Acceptable Use Guidelines.  After the Effective Time, Adient shall not take any action that materially harms or jeopardizes (or could reasonably be expected to materially harm or jeopardize) the value, validity, reputation or goodwill of the Johnson Controls Marks.

 

Section 3.2                                    Compliance with Laws.  Adient shall (a) comply in all material respects with all Laws applicable to it in the performance of its obligations under this Agreement wherever it uses any Johnson Controls Marks; and (b) use all notices and legends required by applicable Law (as communicated by Johnson Controls to Adient from time to time) or that are otherwise reasonably requested by Johnson Controls so as to preserve and maintain the validity of and Johnson Controls’ and its Affiliates’ rights in the Johnson Controls Marks; provided, that any notice requirements requested by Johnson Controls shall not (x) impose any burdens or expenses upon Adient or Adient’s Affiliates that are materially inconsistent with or materially disproportionate to those burdens or expenses imposed upon Johnson Controls and its own Affiliates; (y) confuse consumers as to the Parties’ non-affiliation after the Effective Time; or (z) be inconsistent with any applicable Law.  Johnson Controls shall be permitted to engage an independent third party if Johnson Controls has a good faith basis to believe that Adient materially breached subsections (a) or (b) above, at Johnson Controls’ expense and upon one (1) month’s prior written notice, to inspect and audit Adient’s and its Affiliates’ relevant records and systems during regular business hours, as necessary, to determine Adient’s and its Affiliates’ compliance with subsections (a) and (b) above; provided, that no such inspection or audit shall unreasonably interfere with Adient’s or its Affiliates’ business.

 

Section 3.3                                    Ownership/No Contest.  Adient acknowledges and agrees that, as between the Parties, Johnson Controls and its Affiliates own all rights, title and interests in the Johnson

 

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Controls Marks.  Adient will not challenge or contest such ownership or the validity of any Johnson Controls Marks, including in any Action (it being understood that nothing in this Agreement shall prohibit Adient from defending or taking any action to defend itself against any Third Party Claim arising from Adient’s use of the Johnson Controls Marks).  Adient and its Affiliates shall each be considered a “related company” under Section 5 of the U.S. Lanham Act, 15 U.S.C. § 1055, such that their use of the Johnson Controls Marks and the goodwill generated thereby shall inure to the sole benefit of Johnson Controls and its applicable Affiliates.  Notwithstanding the foregoing, to the extent Adient or any of its Affiliates is deemed to have any ownership rights in the Johnson Controls Marks, at Johnson Controls’ request, Adient shall cause such rights to be assigned to Johnson Controls or its designee for no consideration.

 

Section 3.4                                    Enforcement.  Adient agrees that it shall promptly advise Johnson Controls if Adient becomes aware of any unauthorized third-party use of any Johnson Controls Marks; provided, that the failure to notify Johnson Controls of such use shall not constitute a breach of this Agreement.  Adient shall not take any steps to contact any such third party without Johnson Controls’ prior written permission.  Johnson Controls shall have the sole discretion to determine whether, and in what manner, to respond to any such unauthorized third-party use and shall be exclusively entitled to any remedies, including monetary damages, related thereto or resulting therefrom.  In the event that Johnson Controls decides to initiate any claim against any third party, Adient shall use commercially reasonable efforts to cooperate, in good faith, with Johnson Controls (including by assisting Johnson Controls to claim that the Johnson Controls Marks are famous or distinctive in Johnson Controls’ territory, based upon use in Adient’s territory) at Johnson Controls’ cost and expense.

 

Section 3.5                                    Cooperation.  During the Term and for a period of five (5) years thereafter, Adient shall, upon the request of Johnson Controls, use commercially reasonable efforts to provide, at Johnson Controls’ expense and without undue delay, evidence of use of the Johnson Controls Marks, in Adient’s possession that may be reasonably required to support the maintenance or renewal of relevant trademark registrations and/or defend Johnson Controls Marks against challenges for lack of use (e.g., copies of sales and marketing material, customer invoices and shipping documents); provided, that if Adient no longer desires to store such materials for a product line after the Term, it may notify Johnson Controls of the same and deliver (at Johnson Controls’ cost) electronic media samples of such materials to Johnson Controls and upon acknowledgment by Johnson Controls of receipt of such materials, and the obligations of this Section 3.5 for this product line shall cease thereafter.

 

ARTICLE 4 — TERM AND TERMINATION/SURVIVAL

 

Section 4.1                                    Term.  The term of each license in Section 2.1 commences upon the Effective Time and ends upon the date specified therein.  The term of this Agreement (“Term”) commences at the Effective Time, and continues until the earlier to occur of (a) the last deadline set forth in Section 2.1 expires; and (b) the mutual written agreement of the Parties to terminate this Agreement in its entirety.

 

Section 4.2                                    Termination.  Johnson Controls has the right to terminate this Agreement, effective upon notice to Adient, if Adient commits a material breach of this Agreement that materially harms the goodwill of the Johnson Controls Marks, and such breach shall continue to

 

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be uncured for a period of at least thirty (30) days after receipt by Adient of written notice of such breach from Johnson Controls; provided, that Johnson Controls shall not be entitled to terminate this Agreement if, as of the end of such period, there remains a good-faith Dispute between the Parties (undertaken in accordance with the terms of Section 6.3) as to whether Adient has materially breached this Agreement or cured the applicable breach. 

 

Section 4.3                                    Survival.  Upon the termination of this Agreement, Johnson Controls shall have no further obligation to license the Johnson Controls Marks to Adient.  Section 2.4, Section 2.5, Section 3.3, Section 3.4, Section 3.5 (to the extent set forth therein), Article 4 , and Article 6  shall survive the termination of this Agreement.

 

ARTICLE 5 — REPRESENTATIONS, WARRANTIES AND INDEMNIFICATION

 

Section 5.1                                    By Each Party.  Each Party represents and warrants to the other Party that:  (a) the warranting Party has the requisite corporate or other power and authority and has taken all corporate or other action necessary in order to execute, deliver and perform this Agreement; and (b) this Agreement has been duly executed and delivered by the warranting Party and, assuming the due execution and delivery of this Agreement by both Parties, constitutes a valid and binding agreement of the warranting Party enforceable against the warranting Party in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, moratorium, reorganization or similar laws affecting the enforcement of creditors’ rights generally and general equitable principles.

 

Section 5.2                                    Disclaimer.  EXCEPT AS EXPRESSLY SET FORTH IN SECTION 5.1, THE LICENSES IN SECTION 2.1 ARE GRANTED TO ADIENT ON AN “AS IS,” “WHERE IS” BASIS, AND ADIENT ASSUMES ALL RISK AND LIABILITY ARISING FROM OR RELATING TO ITS USE OF AND RELIANCE UPON THE LICENSES, AND THAT NEITHER PARTY MAKES ANY OTHER REPRESENTATIONS OR GRANTS ANY WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, WITH RESPECT TO THE LICENSES OR TO ANY OTHER MATTERS SET FORTH IN THIS AGREEMENT.  EACH PARTY SPECIFICALLY DISCLAIMS ANY OTHER WARRANTIES, WHETHER WRITTEN OR ORAL, OR EXPRESS OR IMPLIED, WITH RESPECT THERETO, INCLUDING ANY WARRANTY OF TITLE, OWNERSHIP, VALUE, QUALITY, MERCHANTABILITY, SUITABILITY, CONDITION, OR FITNESS FOR A PARTICULAR USE OR PURPOSE, FITNESS FOR USE OR NON-INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.

 

ARTICLE 6 — MISCELLANEOUS

 

Section 6.1                                    Assignment.  This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns; provided, that except as set forth in this Section 6.1, neither Party may assign its rights or delegate its obligations under this Agreement without the express prior written consent of the other Party.  No such consent shall be required for the assignment of a Party’s rights and obligations under the Separation and Distribution Agreement, this Agreement and the other Ancillary Agreements in whole (i.e., the assignment of a Party’s rights and obligations under the Separation and

 

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Distribution Agreement, this Agreement and all the other Ancillary Agreements all at the same time) in connection with a change of control of a Party so long as the resulting, surviving or transferee Person assumes all the obligations of the relevant party thereto by operation of Law or pursuant to an agreement in form and substance reasonably satisfactory to the other Party; provided, that in the event of a change of control of Adient in which the party acquiring control is a direct competitor of Johnson Controls, Johnson Controls may terminate this Agreement upon the occurrence of such change of control.  Without limiting the foregoing, (a) Johnson Controls may assign this Agreement in whole or in part to any of its Affiliates or to any Person who acquires any or all of the Johnson Controls Marks so long as the acquiring Person assumes in writing all of Johnson Controls’ obligations under this Agreement with respect to the acquired Johnson Controls Marks; and (b) each Party may assume this Agreement in bankruptcy and may assign this Agreement to an Affiliate as part of an internal reorganization for tax or administrative purposes.  If the assigning Party assigns this Agreement and its rights to a third Person in accordance with this Agreement, this Agreement shall no longer bind the assigning Party or the other members of its Group, but it shall not release the assigning Party or the other members of its Group from any breach of the Agreement obligations preceding the date of the assignment to the permitted assignee.

 

Section 6.2                                    Notices.  All notices, requests, claims, demands or other communications under this Agreement shall be in writing and shall be given or made (and shall be deemed to have been duly given or made upon acknowledgment of receipt) by delivery in person, by overnight courier service, or by facsimile or electronic transmission with receipt confirmed (followed by delivery of an original via overnight courier service) to the respective Parties at the following addresses (or at such other address for a Party as shall be specified in a notice given in accordance with this Section 6.2):

 

if to Johnson Controls, to:

 

Johnson Controls plc
 5757 North Green Bay Avenue
 Milwaukee, Wisconsin  53209
 Attn:  General Counsel 
 Facsimile: (414) 524-2299
 Email: CO-General.Counsel@jci.com

 

if to Adient, to:

 

Adient plc
 833 East Michigan Street
 Milwaukee, Wisconsin 53202
 Attn:  General Counsel
 Facsimile: [·]
 Email: [·]

 

A Party may, by notice to the other Party, change the address to which such notices are to be given.

 

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Section 6.3                                    Dispute Resolution.  In the event of any Dispute that is not resolved by the Transition Committee after a reasonable period of time, such Dispute shall be resolved in accordance with the dispute resolution process referred to in Article VII of the Separation and Distribution Agreement.

 

Section 6.4                                    Performance.  Without limiting Section 10.18 of the Separation and Distribution Agreement, (a) Johnson Controls will cause to be performed, and hereby guarantees the performance of, all actions, agreements and obligations set forth in this Agreement to be performed by any Affiliate of Johnson Controls and any member of the Johnson Controls Group; and (b) Adient will cause to be performed, and hereby guarantees the performance of, all actions, agreements and obligations set forth in this Agreement to be performed by any Affiliate of Adient and any member of the Adient Group.  For purposes of this Section 6.4, all covenants and agreements in Article III that are to be performed by Adient shall also be required to be performed by each of the Affiliates of Adient and each other member of the Adient Group, to the extent applicable.  Each Party (including its permitted successors and assigns) further agrees that it will (i) give timely notice of the terms, conditions and continuing obligations contained in this Agreement to its Affiliates and all of the other members of its Group; and (ii) cause its Affiliates and all of the other members of its Group not to take any action or fail to take any such action inconsistent with such Party’s obligations under this Agreement or the transactions contemplated hereby or thereby.  Notwithstanding anything to the contrary, (x) if any Affiliate is not, directly or indirectly, controlled by a Party, such Party’s obligations under this Section 6.4 to take an action or not to take an action shall only apply to the extent such Party shall have the right to consent or withhold consent to such action pursuant to the organizational documents or other governance arrangements of such Affiliate, (y) if the consent or approval of a Third Party (other than a Governmental Authority acting in such capacity) is required for any Party’s Affiliate to change its Legacy Entity Name, then such Party’s obligations under this Section 6.4 to cause such Affiliate to comply with Section 2.1(a) shall be limited to notifying each applicable Third Party of such Affiliate’s obligations under Section 2.1(a), requesting the requisite consents or approvals of such Third Party in writing and using commercially reasonable efforts to obtain such consents and approvals promptly after the Effective Date, and (z) Johnson Controls agrees, on behalf of itself and each of its Affiliates, that the use of the Johnson Controls Marks after the expiration of the time periods set forth in Section 2.1 by an Adient Affiliate described in clause (x) or (y) shall not constitute a breach of this Agreement by Adient or the other members of the Adient Group (other than such Affiliate, if it is a member of the Adient Group).  Without limiting the foregoing, if there is a conflict between the rights and obligations applicable to any Affiliate described in clause (x) or (y) of the immediately preceding sentence under this Agreement and any rights or obligations applicable to such Affiliate under a contract or agreement between such Affiliate and the other Party or a member of the other Party’s Group that grants such Affiliate rights to use or license the Johnson Controls Marks, was entered into prior to the Effective Time and continues to be in full force and effect following the Effective Time (a “Pre-Existing Affiliate Contract”), then the terms of the Pre-Existing Affiliate Contract shall prevail.

 

Section 6.5                                    Amendments. No provisions of this Agreement shall be deemed waived, amended, supplemented or modified by a Party, unless such waiver, amendment, supplement or modification is in writing and signed by the authorized representative of the Party against whom it is sought to enforce such waiver, amendment, supplement or modification.  If the Parties have

 

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each determined that it is necessary or advisable to amend this Agreement, but cannot agree on the terms of such amendment, the Parties shall resolve the dispute pursuant to Section 6.3.

 

Section 6.6                                    Incorporation by Reference.  Sections 10.1(a), 10.1(d), 10.2, 10.4, 10.6, 10.7, 10.9 through 10.14, 10.16, 10.17 and 10.19 of the Separation and Distribution Agreement are incorporated by reference into this Agreement, mutatis mutandis, except that each reference to “this Agreement,” “any Ancillary Agreement” or “each Ancillary Agreement” in the Separation and Distribution Agreement shall be deemed to refer to this Agreement.

 

[Remainder of page intentionally left blank]

 

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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly executed as of the date first written above.

 

	
 
    	
JOHNSON CONTROLS PLC
    
	
 
    	
 
    
	
 
    	
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Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
ADIENT PLC
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

[Signature Page to Transitional Trademark License Agreement]Exhibit

Exhibit 10.1 

SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT (this “Agreement”), dated as of June 21, 2016, is entered into by and between Air Transport Services Group, Inc., a Delaware corporation (the “Company”), and Red Mountain Partners, L.P., a Delaware limited partnership (“Seller”).  In consideration of the mutual covenants and promises contained herein, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:
1.Purchase and Sale of the Securities.  Upon the terms and subject to the conditions contained herein, at the Closing (as defined below), the Seller hereby agrees to transfer, assign and deliver to the Company, and the Company hereby agrees to purchase and accept from the Seller, 3,825,554 shares of the common stock, $0.01 par value, of the Company (the “Securities”), at the Closing, free and clear of any liens or encumbrances (other than restrictions arising under securities laws), at the aggregate purchase price (the “Purchase Price”) of $50,000,000.  
2.Closing.  
(a)    The consummation of the transactions contemplated hereby (the “Closing”) shall occur on July 5, 2016 at 10:00 a.m. Pacific Time  or at such other later time or on such other later date as the parties hereto mutually agree.
(b)    At the Closing, (a) the Company shall pay the Purchase Price to the Seller, by wire transfer to the account designated by the Seller in writing prior to the Closing, and (b) the Seller shall deliver to the Company such stock certificates and such shares in electronic form as are equal to the Securities, duly endorsed or with appropriate stock powers, and the Company is hereby authorized to transfer the Securities to the Company.  Each of the Company and the Seller shall, without further consideration, prepare, execute, acknowledge, file, record, publish and deliver such other instruments, certificates and documents, and take such other actions, as may be required by applicable law or be reasonably requested by the other party to vest in the Company all of the Seller’s right, title and interest to and in the Securities, free and clear of any liens or encumbrances (other than restrictions arising under securities laws), and to otherwise carry out the purposes of this Agreement.
3.    Representations and Warranties of the Company. The Company represents and warrants to the Seller as follows:
(a)    Organization; Legal Capacity; Enforceability. The Company is a corporation duly formed, validly existing and in good standing in under the laws of the State of Delaware.  The Company has the requisite power and authority to execute and deliver this Agreement, perform its obligations under this Agreement, and consummate the transactions contemplated by this Agreement.  This Agreement has been duly executed and delivered by the Company, and assuming due authorization, execution and delivery by the other party hereto, this Agreement constitutes the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms.

31133336.2 

(b)    No Conflicts. The execution and delivery of this Agreement, the performance of its obligations under this Agreement, and the consummation of the transactions contemplated by this Agreement, in each case by the Company, do not and will not conflict with, contravene or result in a violation or breach of or default under (with or without notice, lapse of time or both) any applicable law to which the Company or any of its assets is subject, or any agreement, contract, indenture, commitment, instrument or other arrangement or understanding to which the Company is a party or by which any of its assets is bound.
(c)    No Blackout Period.  There is no blackout period or other prohibition, restriction or limitation in effect as of the date hereof with respect to trading by any officer, director or other insider of the Company in any common stock or other securities of the Company.  
4.    Representations and Warranties of the Seller.  The Seller represents and warrants to the Company as follows:
(a)    Legal Capacity. The Seller is a limited partnership duly formed, validly existing and in good standing in under the laws of the State of Delaware.  The Seller has the requisite power and authority to execute and deliver this Agreement, perform its obligations under this Agreement, and consummate the transactions contemplated by this Agreement.  This Agreement has been duly executed and delivered by the Seller, and assuming due authorization, execution and delivery by the other party hereto, this Agreement constitutes the legal, valid and binding obligation of the Seller, enforceable against the Seller in accordance with its terms.
(b)    No Conflicts. The execution and delivery of this Agreement, the performance of its obligations under this Agreement, and the consummation of the transactions contemplated by this Agreement, in each case by the Seller, do not and will not conflict with, contravene or result in a violation or breach of or default under (with or without notice, lapse of time or both) any applicable law to which the Seller or any of his assets is subject, or any agreement, contract, indenture, commitment, instrument or other arrangement or understanding to which the Seller is a party or by which any of its assets is bound.
(c)    Ownership and Transfer of Securities. 
(i)    Immediately prior to the execution and delivery of this Agreement, the Seller legally, equitably and beneficially owns, and holds all right, title and interest (whether of record, beneficially or otherwise) in or to, the Securities. There is no outstanding option, warrant, right, subscription, call, unsatisfied preemptive right or other agreement or right of any kind to purchase or otherwise acquire any of the Securities.  As of the execution and delivery of this Agreement, valid title to all of the Securities will be transferred to, and vest in, the Company, free and clear of all liens and encumbrances (other than restrictions arising under securities laws).
(ii)    The Seller has been the “owner” (as such term is defined in Section 203 of the Delaware General Corporation Law) of at least 15% of the outstanding common stock of the Company during the three-year period immediately preceding the date of this Agreement. 

31133336.2 

(d)    Independent Investigation. The Seller is relying solely on its own independent investigation and knowledge of the Company and its own determination of the value of the Securities in agreeing to the transactions contemplated by this Agreement.
5.    Termination.  If, at any time prior to the Closing, any injunction or restraining order issued by a court of competent jurisdiction enters into effect to enjoin or otherwise restrain the consummation of the transactions contemplated hereby, or any law is enacted, promulgated or enforced by any governmental authority which prohibits the consummation of the transactions contemplated hereby, then either party hereto shall have the right to terminate this Agreement, effective upon written notice to the other party hereto of such termination.
6.    Miscellaneous.
(a)    Entire Agreement; Amendment.  This Agreement constitutes the entire agreement between the parties hereto pertaining to the subject matter hereof and fully supersedes any and all prior or contemporaneous agreements or understandings between the parties hereto pertaining to the subject matter hereof.  This Agreement may be amended only by a written instrument executed by all of the parties hereto.
(b)    Governing Law. This Agreement, including its existence, validity, construction, and operating effect, and the rights of each of the parties hereto, shall be governed by and construed in accordance with the laws of the State of Delaware without regard to otherwise governing principles of conflicts of law.
(c)    Notices.  Any notice or communication required or permitted to be given by any provision of this Agreement shall be in writing and shall be (i) delivered personally to the party to which the same is directed, or (ii) sent by facsimile, recognized national courier service or registered or certified mail, return receipt requested, postage prepaid, addressed as follows:
If to the Company, then to:
Air Transport Services Group, Inc.
145 Hunter Drive
Wilmington, Ohio 45177
Telephone:    (937) 366-2686
Facsimile:    (937) 382-2452
Attention:    W. Joseph Payne
If to the Seller, then to:
Red Mountain Partners, L.P.
c/o Red Mountain Capital Partners LLC
10100 Santa Monica Boulevard, Suite 925
Los Angeles, California 90067
Telephone:    (310) 432-0200
Facsimile:    (310) 432-0201
Attention:    Willem Mesdag

31133336.2 

Any such notice shall be deemed to be delivered, given and received for all purposes as of (x) the date so delivered, if delivered personally, (y) upon receipt, if sent by facsimile or courier service, or (z) on the date of receipt or refusal indicated on the return receipt, if sent by registered or certified mail, return receipt requested, postage and charges prepaid and properly addressed.
 

(d)    Assignment; Binding Effect; Third-Party Beneficiaries.  No party hereto may assign any of its rights or obligations under this Agreement without the prior written consent of the other party hereto, and any purported assignment without such consent shall be void.  This Agreement shall be binding on and inure solely to the benefit of the parties hereto, and their respective heirs, executors, administrators, successors and permitted assignees.  Nothing in this Agreement, express or implied, is intended to confer upon any person other than the parties hereto and their respective permitted successors and assigns any rights or remedies of any nature whatsoever under or by reason of this Agreement.
(e)    Counterparts; Facsimiles.  This Agreement may be executed in any number of multiple counterparts, each of which shall be deemed to be an original copy and all of which shall constitute one agreement, binding on all parties hereto.  Executed signature pages to this Agreement may be delivered by facsimile or transmitted electronically by “pdf” file and such facsimiles or pdf files shall be deemed as sufficient as if actual signature pages had been delivered.
(f)    Waivers.  No waiver by any party hereto of any default with respect to any provision, condition or requirement hereof shall be deemed to be a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party hereto to exercise any right hereunder in any manner impair the exercise of any such right accruing to it thereafter.
(g)    Severability.  If any provision of this Agreement is determined by an arbitrator or any court having jurisdiction to be illegal or in conflict with any applicable law, then the parties hereto agree that such provision shall be modified to the extent legally possible so that the intent of this Agreement may be legally carried out.  If any one or more of the provisions contained herein, or the application thereof in any circumstances, is held invalid, illegal or unenforceable in any respect or for any reason, then the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions hereof shall not be in any way impaired or affected, it being intended that all of the parties hereto rights and privileges shall be enforceable to the fullest extent permitted by applicable law.
(h)    Jurisdiction and Venue; Service of Process; Waiver of Jury Trial.  To the extent permitted by applicable law, any action or proceeding against the parties hereto relating in any way to this Agreement shall be brought and enforced in the courts of the State of Ohio or (to the extent subject matter jurisdiction exists therefor) of the courts of the U.S. District Court for the Southern District of Ohio, in each case, sitting in Cincinnati, Ohio, and the parties hereto irrevocably submit to the jurisdiction of such courts in respect of any such action or proceeding.  The parties hereto irrevocably waive, to the fullest extent permitted by law, any objection that they may now or hereafter have to the laying of venue of any such action or proceeding in the courts of the State of Ohio or the U.S. District Court for the Southern District of Ohio, in each case, sitting in Cincinnati, 

31133336.2 

Ohio and any claim that any such action or proceeding brought in any such court has been brought in an inconvenient forum.  Each party hereto agrees that service of process upon such party in any such action or proceeding shall be effective if notice is given in accordance with the provisions of this Agreement.  EACH PARTY HERETO HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY ACTION OR PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.  EACH PARTY (I) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (II) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 4(H).
(i)    Enforcement of this Agreement.  The parties hereto agree that money damages or other remedy at law would not be sufficient or adequate remedy for any breach or violation of, or default under, this Agreement by them and that in addition to all other remedies available to them, each of them shall be entitled to the fullest extent permitted by law to an injunction restraining such breach, violation or default and to other equitable relief, including specific performance, with bond or other security being required.
(j)    Survival of Representations, Warranties and Covenants.  All representations, warranties, and covenants hereunder shall survive the consummation of the transactions contemplated by this Agreement.
(k)    Interpretation of this Agreement.  Unless the context clearly indicates otherwise: (i) each definition herein includes the singular and the plural; (ii) each reference herein to any gender includes the masculine, feminine, and neuter where appropriate; (iii) the word “including” when used herein means “including, but not limited to,” and the word “include” when used herein means “include, without limitation”; and (iv) references herein to specified article or section numbers refer to the specified article or section of this Agreement. The words “hereof,” “herein,” “hereto,” “hereby,” “hereunder,” and derivative or similar words refer to this Agreement as a whole and not to any particular provision of this Agreement. The term “person” includes both entities and natural persons. All ambiguities shall be resolved without reference to which party may have drafted this Agreement. All section titles or other headings or captions in this Agreement are for convenience only, and they shall not be deemed part of this Agreement and in no way define, limit, extend or describe the scope or intent of any provision hereof.  All references to “$” or “dollars” mean the lawful currency of the United States of America.  All references to any statute, rule or regulation are to the statute, rule or regulation as amended, modified, supplemented or replaced from time to time (and, in the case of statutes, include any rules and regulations promulgated under the statute) and to any section of any statute, rule or regulation include any successor to the section.

(l)    Time of Essence.  With regard to all dates and time periods set forth or referred to in this Agreement, time is of the essence.  The parties hereto acknowledge that each will be relying 

31133336.2 

upon the timely performance of the other of its obligations hereunder as a material inducement to such party’s execution and delivery of this Agreement.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]

31133336.2 

IN WITNESS WHEREOF, the undersigned have caused this Agreement to be duly executed as of the date first written above.
 
 

COMPANY:
AIR TRANSPORT SERVICES GROUP, INC.
By:    /s/ W. Joseph Payne    
Name:    W. Joseph Payne
Title:    Chief Legal Officer & Secretary

SELLER:
RED MOUNTAIN PARTNERS, L.P.
By:    /s/ J. Christopher Teets    
Name:    J. Christopher Teets
Title:    Partner, Authorized Signatory

31133336.2

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