Document:

exv10w3

EXHIBIT 10.3

 

INTELLECTUAL PROPERTY LICENSE AGREEMENT

between

NORTHROP GRUMMAN SYSTEMS CORPORATION

and

NORTHROP GRUMMAN SHIPBUILDING, INC.

Dated as of [________]

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	ARTICLE I DEFINITIONS 
	 	 	1	 
	 
	Section 1.1 Table of Definitions 
	 	 	1	 
	Section 1.2 Certain Defined Terms 
	 	 	2	 
	 
	 	 	 	 
	ARTICLE II GRANT OF LICENSES 
	 	 	4	 
	 
	 	 	 	 
	Section 2.1 Grant of Licenses
	 	 	4	 
	Section 2.2 Have Made Rights 
	 	 	4	 
	Section 2.3 Right to Sublicense 
	 	 	5	 
	Section 2.4 Licensed Software 
	 	 	5	 
	Section 2.5 Delivery of Embodiments of IP 
	 	 	5	 
	Section 2.6 Jointly Developed Intellectual Property 
	 	 	5	 
	 
	 	 	 	 
	ARTICLE III OWNERSHIP 
	 	 	6	 
	 
	 	 	 	 
	Section 3.1 Ownership 
	 	 	6	 
	Section 3.2 Ownership of Improvements and Derivative Works 
	 	 	6	 
	Section 3.3 No Other License 
	 	 	6	 
	Section 3.4 Prosecution and Maintenance 
	 	 	6	 
	 
	 	 	 	 
	ARTICLE IV CONFIDENTIALITY 
	 	 	7	 
	 
	 	 	 	 
	Section 4.1 Proprietary Information 
	 	 	7	 
	Section 4.2 Confidentiality 
	 	 	7	 
	Section 4.3 Limited Exception 
	 	 	8	 
	Section 4.4 Unauthorized Disclosure 
	 	 	8	 
	 
	 	 	 	 
	ARTICLE V REPRESENTATIONS; DISCLAIMER 
	 	 	8	 
	 
	 	 	 	 
	Section 5.1 Mutual Representations 
	 	 	8	 
	Section 5.2 Disclaimer 
	 	 	8	 
	Section 5.3 Limitations on Liability 
	 	 	9	 
	Section 5.4 Indemnification 
	 	 	9	 
	 
	 	 	 	 
	ARTICLE VI TERM 
	 	 	9	 
	 
	Section 6.1 Term 
	 	 	9	 
	 
	 	 	 	 
	ARTICLE VII TRANSFERABILITY 
	 	 	10	 
	 
	 	 	 	 
	Section 7.1 Assignment 
	 	 	10	 

 

 

TABLE OF CONTENTS

(Continued)

	 	 	 	 	 
	 	 	Page	 
	ARTICLE VIII GENERAL PROVISIONS 
	 	 	10	 
	 
	 	 	 	 
	Section 8.1 Amendment and Modification 
	 	 	10	 
	Section 8.2 Waiver 
	 	 	10	 
	Section 8.3 Notices 
	 	 	10	 
	Section 8.4 Interpretation 
	 	 	11	 
	Section 8.5 Entire Agreement 
	 	 	12	 
	Section 8.6 No Third-Party Beneficiaries 
	 	 	12	 
	Section 8.7 Governing Law 
	 	 	12	 
	Section 8.8 Submission to Jurisdiction 
	 	 	12	 
	Section 8.9 Enforcement 
	 	 	13	 
	Section 8.10 Severability 
	 	 	13	 
	Section 8.11 Waiver of Jury Trial 
	 	 	13	 
	Section 8.12 Counterparts 
	 	 	13	 
	Section 8.13 Facsimile Signature 
	 	 	13	 
	Section 8.14 Effect if Distribution Does Not Occur 
	 	 	14	 

ii

 

INTELLECTUAL PROPERTY LICENSE AGREEMENT

     INTELLECTUAL PROPERTY LICENSE AGREEMENT, dated as of [______________] (this “License
Agreement”), between Northrop Grumman Systems Corporation, a Delaware corporation
(“NGSC”) and Northrop Grumman Shipbuilding, Inc., a Virginia corporation (“NGSB”).

RECITALS

     A. NGSC, NGSB, Northrop Grumman Corporation, a Delaware corporation (“NGC”), New P,
Inc., a Delaware corporation (“New NGC”), and Huntington Ingalls Industries, Inc., a
Delaware corporation (“HII”), have entered into the Separation and Distribution Agreement
(the “Separation Agreement”), dated as of the date hereof, pursuant to which New NGC
intends to distribute to its stockholders its entire interest in HII by way of a stock dividend
(the “Distribution”).

     B. Following the Distribution, NGSC will be a wholly owned subsidiary of New NGC (which will
be renamed “Northrop Grumman Corporation”) and NGSB will be a wholly owned subsidiary of HII and
will be renamed “Huntington Ingalls Industries Company.”

     C. The parties wish to set forth their agreements as to certain matters regarding Intellectual
Property (as defined below) under which each party shall grant to the other a non-exclusive license
of the Intellectual Property owned by such party or any of its Affiliates that is used by the other
party in the conduct of their respective businesses and within the Field of Use (as defined below).

AGREEMENT

     In consideration of the foregoing and the mutual covenants and agreements herein contained,
and intending to be legally bound hereby, the parties agree as follows:

ARTICLE I

DEFINITIONS

     Section 1.1 Table of Definitions. The following terms have the meanings set forth on the pages referenced below:

	 	 	 	 	 
	Definition	 	Page	 
	Affiliate 
	 	 	2	 
	Business Day 
	 	 	2	 
	Disclosing Party 
	 	 	7	 
	Distribution 
	 	 	1	 
	Field of Use 
	 	 	2	 
	Governmental Authority 
	 	 	3	 
	HII 
	 	 	1	 
	Improved Software 
	 	 	5	 

 

 

	 	 	 	 	 
	Definition	 	Page	 
	Indemnifying Party 
	 	 	9	 
	Intellectual Property 
	 	 	3	 
	License Agreement 
	 	 	1	 
	Licensed Intellectual Property 
	 	 	3	 
	Licensee 
	 	 	3	 
	Licensor 
	 	 	3	 
	Licensor Indemnitees 
	 	 	9	 
	Line of Business 
	 	 	3	 
	New NGC 
	 	 	1	 
	NGC 
	 	 	1	 
	NGSB 
	 	 	1	 
	NGSC 
	 	 	1	 
	Person 
	 	 	3	 
	Proprietary Information 
	 	 	7	 
	Receiving Party 
	 	 	7	 
	Relevant Usage Period 
	 	 	3	 
	Separation Agreement 
	 	 	1	 
	Software 
	 	 	3	 
	Subsidiary 
	 	 	3	 

     Section 1.2 Certain Defined Terms. For the purposes of this License Agreement:

          “Affiliate” of any Person means a Person that controls, is controlled by, or is under
common control with such Person; provided, however, that for purposes of this
License Agreement, NGSC and its Subsidiaries shall not be deemed to be an Affiliate of NGSB and
NGSB and its Subsidiaries shall not be deemed to be an Affiliate of NGSC. 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.

          “Business Day” means a day other than a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to close.

          “Field of Use” means, as to any Intellectual Property, the use of such Intellectual
Property that the Licensee has made in the ordinary course of its business in the Relevant Usage
Period prior to and including the Distribution, including the general manner and scope of such use
in the Line of Business for which the Intellectual Property has been used during such Relevant
Usage Period. In the event of a dispute
between the parties as to whether a particular use by a Licensee of Licensed Intellectual
Property licensed to such Licensee is within the applicable Field of Use, the Licensee will have
the burden of proof by a preponderance of the evidence.

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          “Governmental Authority” means any United States or non-United States federal, state,
local, territorial, tribal or international court, government, department, commission, board,
bureau, agency, official or other legislative, judicial, regulatory, administrative or governmental
authority.

          “Intellectual Property” or “IP” means all of the following intellectual
property rights, whether arising under the laws of the United States or the laws of any other
jurisdiction: (a) patents, (b) copyrights, (c) trade secrets, know-how and other confidential and
proprietary information, and (d) all registrations and applications for registration of any of the
foregoing, but excluding (e) trademarks, service marks, domain names and similar rights.

          “Licensed Intellectual Property” means all Intellectual Property owned by a party or
any of its Affiliates as of the Distribution that, in the Relevant Usage Period prior to or at the
time of the Distribution, is being used by the other party or any of its Affiliates in the ordinary
course of such other party’s or any of its Affiliate’s businesses.

          “Licensee” means, collectively, a party and its Affiliates in their capacity as
licensees to which a license of Licensed Intellectual Property is granted by Licensor hereunder.

          “Licensor” means, collectively, a party and its Affiliates in their capacity as
licensors of Licensed Intellectual Property that is licensed to Licensee hereunder.

          “Line of Business” means a set of one or more highly related products which service a
particular business need.

          “Person” means an individual, corporation, partnership, limited liability company,
limited liability partnership, syndicate, person, trust, association, organization or other entity,
including any Governmental Authority, and including any successor, by merger or otherwise, of any
of the foregoing.

          “Relevant Usage Period” means, in the case of the Licensed Intellectual Property that
is described in Schedule A, the applicable period specified therein or, in the case of all
other Licensed Intellectual Property, the 12-month period prior to the Distribution.

          “Software” means computer software and databases, together with, as applicable, object
code, source code, firmware and embedded versions thereof and documentation related thereto.

          “Subsidiary” of any Person means any corporation or other organization, whether
incorporated or unincorporated, of which at least a majority of the securities or interests having
by the terms thereof ordinary voting power to elect at least a majority of the board of directors
or others performing similar functions with respect to such corporation or other organization is
directly or indirectly owned or controlled by such Person or by any one or more of its
Subsidiaries, or by such Person and one or more of its Subsidiaries; provided,
however, that no Person that is not directly or indirectly wholly

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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.

ARTICLE II

GRANT OF LICENSES

     Section 2.1 Grant of Licenses.

          (a) Subject to the terms and conditions of this License Agreement, each Licensor hereby grants
to the respective Licensee a non-exclusive, worldwide, fully paid, non-transferable (except as
expressly provided in Article VII), irrevocable and perpetual license, solely within such
Licensee’s Field of Use, to:

               (i) make (including the right to use any apparatus and practice any method in making), have
made, make improvements on, use, import, offer for sale, lease, sell and/or otherwise transfer
products and provide services under the patents included in such Licensor’s Licensed Intellectual
Property (including any patents that hereafter issue on patent applications that are pending as of
the Distribution);

               (ii) use, reproduce, distribute, prepare derivative works of, and publicly perform and
publicly display any original works of authorship (or any derivative works based thereon) that are
the subject of any of the copyrights included in such Licensor’s Licensed Intellectual Property;
and

               (iii) use and exploit any know-how or other trade secrets or proprietary information included
in such Licensor’s Licensed Intellectual Property, subject to compliance with the confidentiality
obligations set forth in Article IV.

          (b) Each party shall cause its Affiliates to grant the licenses contemplated to be granted by
such Affiliates hereunder and to perform all of their obligations imposed hereunder, including the
confidentiality obligations set forth in Article IV.

          (c) Each Licensee will, and will cause its Affiliates to, comply with the Field of Use and all
other limitations or restrictions imposed under this License Agreement with respect to its and its
Affiliates’ use of the Licensed Intellectual Property licensed to it and its Affiliates hereunder.

     Section 2.2 Have Made Rights. The licenses granted in Sections 2.1(a)(i) by the applicable Licensor to the applicable
Licensee to have products made by a third party or to import products: (a) apply only when the
specifications for such Licensee’s products were created by or specifically for Licensee (either
solely or jointly with one or more third parties), (b) extend only to those claims of Licensor’s
licensed patents, the infringement of which would be necessitated by compliance with such
specifications and (c) do not apply to any methods used, or any products in substantially the same
form manufactured or marketed, by such third party, prior to Licensee’s furnishing of such
specifications.

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     Section 2.3 Right to Sublicense. Each Licensee shall have the right to sublicense freely the rights and licenses granted by
the applicable Licensor pursuant to Section 2.1(a) to Licensee’s contractors, sub-contractors and
agents for use solely in connection with the operation of Licensee’s business and within the Field
of Use. Each Licensee shall ensure that all such permitted sublicensees shall abide by the terms
and conditions of this License Agreement, to the extent applicable, and all such grants of
sublicenses shall be made in writing and executed by all parties thereto.

     Section 2.4 Licensed Software. The parties agree and acknowledge that any Software that is licensed under this License
Agreement shall be licensed only in the form in which it is being used by the Licensee in the
ordinary course of its business in the Relevant Usage Period prior to and including the
Distribution. Accordingly, if a Licensee is using any source code of any Software licensed to it
hereunder by the Licensor in the ordinary course of its business in the Relevant Usage Period prior
to and including the Distribution, such Licensee will be permitted to retain such source code and
the licenses granted under Section 2.1(a) to such Licensee shall extend to such source code.
Notwithstanding the foregoing, for the Software identified on Schedule B hereto that is
undergoing improvement or as to which a derivative work is being prepared (“Improved
Software”), the parties agree and acknowledge that any such Improved Software that is licensed
under this License Agreement shall be licensed in such form existing immediately after successful
completion of testing of the improvement and/or derivative works that is in process of being made
or prepared as of the Distribution, even if such form comes into existence after the Distribution.
Accordingly, for such Improved Software that has been used by the Licensee in source code form in
the ordinary course of its business in the Relevant Usage Period prior to and including the
Distribution, such Licensee will be permitted to obtain such source code in the form existing
immediately after such successful completion of testing and the licenses granted under Section
2.1(a) to such Licensee shall extend to such source code. For the avoidance of doubt, this License
Agreement provides for the licensing of Intellectual Property that is owned by a party or an
Affiliate thereof and nothing in this License Agreement provides for any sublicensing of Software
or any other Intellectual Property that is owned by a third party or any assignment of any license
of Software or any other Intellectual Property that is owned by a third party.

     Section 2.5 Delivery of Embodiments of IP. To the extent that a Licensee is not in possession as of the Distribution of any embodiment
of Licensed Intellectual Property licensed to such Licensee hereunder, the respective Licensor
hereby agrees to deliver to such Licensee upon request, as soon as practicable after the
Distribution, copies of all such embodiments of such Licensed Intellectual Property. Thereafter,
each Licensor shall have no further obligation to deliver any Licensed Intellectual Property, or
copies thereof, to each Licensee under this License Agreement. Each Licensor shall have no further
access to, or any obligation to maintain or service, any electronic copies of such Licensed
Intellectual Property that is delivered to the Licensee.

     Section 2.6 Jointly Developed Intellectual Property. If either party or any of its Affiliates materially contributed to the development of any
Intellectual Property that is owned by the other party or any of the other party’s Affiliates as of
the Distribution, and such Intellectual Property does not constitute Licensed Intellectual Property
that is licensed

5

 

to such party and such party’s Affiliates hereunder, the other party agrees that,
if such party requests that it and its Affiliates be granted a license to use such Intellectual
Property within the scope of their Lines of Business existing as of the Distribution, the other
party will consider in good faith granting such requested license.

ARTICLE III

OWNERSHIP

     Section 3.1 Ownership. Each Licensee acknowledges that, as between the parties, each Licensor owns all right,
title and interest in and to its Licensed Intellectual Property. Each Licensee agrees that it
shall not, directly or indirectly, challenge the validity, enforceability or ownership of the
respective Licensor’s Licensed Intellectual Property.

     Section 3.2 Ownership of Improvements and Derivative Works. Each party or its applicable Affiliate will own exclusively all improvements and derivative
works created or developed by such party or its Affiliate that are derived from or based on any
Licensed Intellectual Property licensed from the other party hereunder, subject to the other
party’s retained ownership of the Licensed Intellectual Property on which such improvements and
derivative works are based or from which they are derived. Other than for Improved Software as
provided in Section 2.4, neither party (nor any Affiliate thereof) shall have any obligation to
disclose or license any such improvements or derivative works to the other party.

     Section 3.3 No Other License. Except as expressly provided in this License Agreement, nothing herein shall be construed
as granting to a party any license or other rights under any other Intellectual Property rights of
the other party whether by implication or estoppel. Nothing herein shall grant either party, in
selling or promoting the sale of products or services, the right to
directly or indirectly use or refer to the trademarks or trademark type rights of the other
party or trademarks or other marks and names similar thereto.

     Section 3.4 Prosecution and Maintenance. Each Licensor shall have the sole and exclusive right, but not the obligation, at its sole
cost and expense: (a) to file, prosecute, obtain and maintain, throughout the world, any patents,
patent applications and other registrations or applications for registration included in the
Licensed Intellectual Property owned by such Licensor, and (b) to conduct or participate,
throughout the world, in any interference, reexaminaton, opposition, cancellation, nullification
and other interpartes, ex partes or other types of proceedings before the U.S. Patent & Trademark
Office and similar authorities, registries or agencies, and all appeals thereof (regardless of
forum) involving or relating to such Licensed Intellectual Property. The manner in which any such
filing, prosecution, maintenance or any other action is conducted by such Licensor under this
Section 3.4 shall be in such Licensor’s sole control and discretion.

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ARTICLE IV

CONFIDENTIALITY

     Section 4.1 Proprietary Information. For the purposes hereof, “Proprietary
Information” of a party (the “Disclosing Party”) means all business sensitive and/or
proprietary information of the Disclosing Party disclosed to, or in the possession of, the other
party (the “Receiving Party”), whether disclosed orally, verbally, visually,
electronically, in tangible form or otherwise, and regardless of whether marked, denoted or
otherwise indicated as “business sensitive,” “proprietary,” “private” or words of similar import.
Proprietary Information of Licensor shall include trade secrets and other business sensitive and
proprietary information included in the Licensed Intellectual Property.

     Section 4.2 Confidentiality.

          (a) In maintaining the confidentiality of Proprietary Information of the Disclosing Party, the
Receiving Party shall exercise the same degree of care that it exercises with its own Proprietary
Information, but in no event less than a reasonable degree of care. Without limiting any of the
foregoing, the Receiving Party shall not disclose or give access to any such Proprietary
Information to any third party, other than its personnel, sublicensees or customers pursuant to
contract requirements, without the prior written consent of the Disclosing Party. The Receiving
Party shall restrict access to such Proprietary Information to those of its personnel and
sublicensees having a strict need for access thereto, and shall use commercially reasonable efforts
to ensure that each of its personnel and sublicensees holds in confidence the Proprietary
Information of the Disclosing Party in accordance with the terms and conditions hereof. The
Receiving Party shall, and shall cause its personnel and sublicensees to, make no use, directly or
indirectly, of any Proprietary Information of the Disclosing Party for any purpose other than as
authorized hereunder. The Receiving Party shall not copy or reproduce the Proprietary Information
or any portion thereof, or remove any tangible copies of the Proprietary Information or any portion
thereof from the Receiving Party’s facilities except as reasonably required in connection with
exercising the rights licensed hereunder or as expressly permitted by the Disclosing Party.

          (b) The confidentiality obligations contained in Section 4.2(a) shall not apply to any
information that contemporaneous written records of the Receiving Party demonstrate (a) was
lawfully disclosed to the Receiving Party without restriction by an unrelated third party who does
not have any obligations of confidentiality to the Disclosing Party, (b) the Receiving Party
independently developed such information prior to the Distribution without any use of or reference
to the Proprietary Information of the Disclosing Party or (c) is or becomes part of the public
domain through no fault of the Receiving Party, it being understood that if only a portion of any
such information is or becomes part of the public domain (including by way of issued patents or
published patent applications), the confidentiality obligations of the Receiving Party with respect
to the rest of the Proprietary Information shall remain intact without modification.

7

 

     Section 4.3 Limited Exception. The obligation of confidentiality and non-disclosure
contained in this License Agreement shall not apply to the extent that the Receiving Party is
required to disclose any Proprietary Information of the Disclosing Party by a valid subpoena, order
or regulation of a governmental agency or a court of competent jurisdiction having jurisdiction
over the Receiving Party; provided, however, that the Receiving Party shall not
intentionally make any such disclosure without (a) first notifying the Disclosing Party and
allowing the Disclosing Party a reasonable opportunity to prevent or limit such disclosure (either
by challenging or quashing any such subpoena, order or regulation or obtaining injunctive relief
from, or a protective order with respect to, the obligation to make such disclosure), and (b)
reasonably cooperating, at Disclosing Party’s expense, with the Disclosing Party’s efforts to
prevent or limit such disclosure.

     Section 4.4 Unauthorized Disclosure. The Receiving Party acknowledges and confirms
that the Proprietary Information of the Disclosing Party constitutes proprietary information and
trade secrets valuable to the Disclosing Party, and that the unauthorized use, loss or outside
disclosure of such Proprietary Information shall cause irreparable injury to the Disclosing Party.
The Receiving Party shall notify the Disclosing Party immediately upon discovery of any
unauthorized use or disclosure of such Proprietary Information, and will cooperate with the
Disclosing Party in every reasonable way to help regain possession of such Proprietary Information
and to prevent its further unauthorized use. The Receiving Party acknowledges and agrees that
monetary damages may not be a sufficient remedy for unauthorized disclosure of Proprietary
Information of the Disclosing Party and that the Disclosing Party shall be entitled, without
waiving other rights or remedies, to such injunctive or equitable relief as may be deemed proper by
a court of competent jurisdiction. The prevailing party shall be entitled to recover reasonable
attorney’s fees incurred by it in connection with any action commenced by the Disclosing Party
against the Receiving Party arising out of or relating to any alleged disclosure of Proprietary
Information of the Disclosing Party by the Receiving Party in breach of this License Agreement.

ARTICLE V

REPRESENTATIONS; DISCLAIMER

     Section 5.1 Mutual Representations. Each party represents and warrants that (a) it
has the power and authority to enter into this License Agreement and has taken all necessary
corporate action to authorize its performance under this License Agreement; (b) this License
Agreement, when executed and delivered, will constitute a legal, valid and binding obligation of
each such party, enforceable in accordance with its terms; (c) no consent or authorization of,
filing with, or notice to any governmental authority is required in connection with its performance
under this License Agreement; and (d) its entering into this License Agreement or performance by it
hereunder will not violate any federal, state or local licensing or other statute, rule or
regulation, or any contractual obligation of such party. Each party agrees to comply with all
applicable Laws, rules and regulations in connection with its activities under this License
Agreement.

     Section 5.2 Disclaimer. Except as expressly set forth in this License Agreement, each
of the licenses of Licensed Intellectual Property granted by a Licensor

8

 

hereunder are made “as-is” and “where-is.” Each Licensor hereby disclaims all representations
or warranties of any kind, either express or implied, including any warranty of merchantability,
fitness for a particular purpose, non-infringement or any other matter with respect to any Licensed
Intellectual Property licensed by such Licensor, whether used alone or combined with other products
or services.

     Section 5.3 Limitations on Liability. Except for any willful breach of Articles III
and IV, under no circumstances shall either party be liable to the other party for indirect,
incidental, consequential, punitive or exemplary damages (even if such other party has been advised
of the possibility of such damages) arising from a claim for breach of any provision of this
License Agreement. Notwithstanding the foregoing, the provisions of this Section 5.3 shall not
limit an Indemnifying Party’s indemnification obligations with respect to any Liability that any
Licensor Indemnitee may have to any third party that is not an Affiliate of any party.

     Section 5.4 Indemnification. Following the Distribution, each Licensee (an
“Indemnifying Party”) shall indemnify, defend and hold harmless the respective Licensor and
such Licensor’s Affiliates and its and their respective current, former and future directors,
officers and employees, and each of the heirs, executors, successors and assigns of any of the
foregoing (collectively, the “Licensor Indemnitees”), from and against any and all (a)
Third Party Claims (as defined in the Separation Agreement) asserted or brought against any of the
Licensor Indemnitees based on or relating to the exercise by the Indemnifying Party or any of its
Affiliates of the license to use the Licensed Intellectual Property that is granted to such
Licensee or any such Affiliates hereunder or otherwise relating to the Indemnifying Party’s or any
of its Affiliates’ use of the Licensed Intellectual Property licensed hereunder and (b) all
Liabilities relating to, arising out of or resulting from any such Third Party Claims. The notice
and other indemnification procedures set forth in Sections 5.4, 5.5 (other than Section 5.5(b)),
5.6, 5.7 and 5.8 of the Separation Agreement that apply to indemnification claims arising under
Article V of the Separation Agreement are hereby incorporated by reference and shall apply to any
indemnification claims arising under this Section 5.4.

ARTICLE VI

TERM

     Section 6.1 Term. The rights granted to each party under this License Agreement shall
be irrevocable and perpetual and shall not be terminable by either party, and such rights shall
continue in full force and effect notwithstanding any breach by the other party hereunder;
provided that, if any Licensee breaches any limitations or restrictions imposed on it in
Sections 2.1, 2.2 or 2.3 with respect to its use of any Licensed Intellectual Property licensed to
it hereunder, or materially breaches any confidentiality obligations set forth in Article IV with
respect to its use of any Licensed Intellectual Property licensed to it hereunder, then, effective
upon 30 days’ prior written notice by the Licensor to the Licensee, such Intellectual Property
thereafter shall be excluded from the Licensed Intellectual Property licensed to the Licensee
hereunder and, upon the expiration of such 30-day period, Licensee shall cease any and all use of
such Licensed Intellectual

9

 

Property unless, prior to expiration of such 30-day period, Licensee has fully cured such
breach.

ARTICLE VII

TRANSFERABILITY

     Section 7.1 Assignment. This License Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted assigns. Neither party
may assign this License Agreement without the prior written consent of the other party.
Notwithstanding the foregoing, either party may freely assign or otherwise transfer this License
Agreement or its rights hereunder, in whole or in part, to any of its Affiliates or to a third
party in connection with the sale of all or substantially all of the assets of such party or any of
its Affiliates to which this License Agreement pertains or in connection with a merger,
consolidation, corporate reorganization or any change of control of such party or any of its
Affiliates or a sale or divestiture of any of the product lines, operating units or business
divisions of such party or any of its Affiliates; provided that (a) the assigning party
shall provide written notice to the other party of any such assignment, and (b) such assignee shall
agree to assume all applicable obligations of the assigning party hereunder, and to be subject to
the terms of this License Agreement. For the avoidance of doubt, any permitted assignee of any
license granted under Article II of this License Agreement is subject to the Field of Use and all
other limitations or restrictions imposed under this License Agreement with respect to such
license, including in particular the Field of Use limitation that limits use of Licensed
Intellectual Property to use by and in the Line of Business where and as the Licensed Intellectual
Property was used during the Relevant Usage Period prior to the Distribution.

ARTICLE VIII

GENERAL PROVISIONS

     Section 8.1 Amendment and Modification. This License Agreement may not be amended,
modified or supplemented in any manner, whether by course of conduct or otherwise, except by an
instrument in writing specifically designated as an amendment hereto, signed on behalf of each
party.

     Section 8.2 Waiver. No failure or delay of any party in exercising any right or
remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any
such right or power, or any abandonment or discontinuance of steps to enforce such right or power,
or any course of conduct, preclude any other or further exercise thereof or the exercise of any
other right or power. The rights and remedies of the parties hereunder are cumulative and are not
exclusive of any rights or remedies that they would otherwise have hereunder. Any agreement on the
part of any party to any such waiver shall be valid only if set forth in a written instrument
executed and delivered by a duly authorized officer on behalf of such party.

     Section 8.3 Notices. All notices and other communications hereunder shall be in
writing and shall be deemed duly given (a) on the date of delivery if delivered personally, or if
by facsimile, upon written confirmation of receipt by facsimile, e-mail or

10

 

otherwise, (b) on the first Business Day following the date of dispatch if delivered utilizing
a next-day service by a recognized next-day courier or (c) on the earlier of confirmed receipt or
the fifth Business Day following the date of mailing if delivered by registered or certified mail,
return receipt requested, postage prepaid. All notices hereunder shall be delivered to the
addresses set forth below, or pursuant to such other instructions as may be designated in writing
by the party to receive such notice:

	 	 	 

	(i)

	 	if to NGSC prior to the date on which New NGC relocates its
corporate headquarters, to:
	 
	 	 
	 

	 	c/o Northrop Grumman Corporation
	 

	 	1840 Century Park East
	 

	 	Los Angeles, CA 90067-2199
	 

	 	Attention: General Counsel
	 

	 	Facsimile:                                                             
	 
	 	 
	(ii)

	 	if to NGSC after the date on which New NGC relocates its
corporate headquarters, to:
	 
	 	 
	 

	 	c/o Northrop Grumman Corporation
	 

	 	4101 Washington Avenue
	 

	 	Newport News, VA 23607
	 

	 	Attention: General Counsel
	 

	 	Facsimile:                                                             
	 
	 	 
	(iii)

	 	if to NGSB, to:
	 
	 	 
	 

	 	c/o Huntington Ingalls Industries, Inc.
	 

	 	4101 Washington Avenue
	 

	 	Newport News, VA 23607
	 

	 	Attention:                                                             
	 

	 	Facsimile:                                                             

     Section 8.4 Interpretation. When a reference is made in this License Agreement to a
Section, Article or Exhibit such reference shall be to a Section, Article or Exhibit of this
License Agreement unless otherwise indicated. The table of contents and headings contained in this
License Agreement or in any Exhibit are for convenience of reference purposes only and shall not
affect in any way the meaning or interpretation of this License Agreement. All words used in this
License Agreement will be construed to be of such gender or number as the circumstances require.
Any capitalized terms used in any Exhibit but not otherwise defined therein shall have the meaning
as defined in this License Agreement. All Exhibits annexed hereto or referred to herein are hereby
incorporated in and made a part of this License Agreement as if set forth herein. The word
“including” and words of similar import when used in this License Agreement shall mean “including,
without limitation,” unless otherwise specified. Where either party’s consent is required
hereunder, except as otherwise specified herein, such party’s consent may be granted or

11

 

withheld in such party’s sole and absolute discretion. The word “day” when used in this
License Agreement shall mean “calendar day,” unless otherwise specified.

     Section 8.5 Entire Agreement. This License Agreement, the Separation Agreement and
the Exhibits, Schedules and Appendices hereto and thereto constitute the entire agreement, and
supersedes all prior written agreements, arrangements, communications and understandings and all
prior and contemporaneous oral agreements, arrangements, communications and understandings among
the parties with respect to the subject matter hereof. This License Agreement shall not be deemed
to contain or imply any restriction, covenant, representation, warranty, agreement or undertaking
of any party with respect to the transactions contemplated hereby other than those expressly set
forth herein or in any document required to be delivered hereunder. Notwithstanding any oral
agreement or course of action of the parties or their representatives to the contrary, no party to
this License Agreement shall be under any legal obligation to enter into or complete the
transactions contemplated hereby unless and until this License Agreement shall have been executed
and delivered by each of the parties.

     Section 8.6 No Third-Party Beneficiaries. Nothing in this License Agreement, express
or implied, is intended to or shall confer upon any Person other than the parties and their
respective successors and permitted assigns any legal or equitable right, benefit or remedy of any
nature under or by reason of this License Agreement.

     Section 8.7 Governing Law. This License Agreement and all disputes or controversies
arising out of or relating to this License Agreement or the transactions contemplated hereby shall
be governed by, and construed in accordance with, the internal laws of the State of New York,
without regard to the laws of any other jurisdiction that might be applied because of the conflicts
of laws principles of the State of New York (other than Section 5-1401 of the New York General
Obligations Law).

     Section 8.8 Submission to Jurisdiction. Each of the parties irrevocably agrees that
any legal action or proceeding arising out of or relating to this License Agreement brought by any
other party or its successors or assigns shall be brought and determined in any federal court
sitting in the Borough of Manhattan in the City of New York (or, if such court lacks subject matter
jurisdiction, in any appropriate New York State or federal court), and each of the parties hereby
irrevocably submits to the exclusive jurisdiction of the aforesaid courts for itself and with
respect to its property, generally and unconditionally, with regard to any such action or
proceeding arising out of or relating to this License Agreement and the transactions contemplated
hereby. Each of the parties agrees not to commence any action, suit or proceeding relating thereto
except in the courts described above in New York, other than actions in any court of competent
jurisdiction to enforce any judgment, decree or award rendered by any such court in New York as
described herein. Each of the parties further agrees that notice as provided in Section 8.3 shall
constitute sufficient service of process and the parties further waive any argument that such
service is insufficient. Each of the parties hereby irrevocably and unconditionally waives, and
agrees not to assert, by way of motion or as a defense, counterclaim or otherwise, in any action or
proceeding arising out of or relating to this License Agreement or the transactions contemplated
hereby, (a) any claim that it is not personally subject to the

12

 

jurisdiction of the courts in New York as described herein, (b) that it or its property is
exempt or immune from jurisdiction of any such court or from any legal process commenced in such
courts (whether through service of notice, attachment prior to judgment, attachment in aid of
execution of judgment, execution of judgment or otherwise) and (c) that (i) the suit, action or
proceeding in any such court is brought in an inconvenient forum, (ii) the venue of such suit,
action or proceeding is improper or (iii) this License Agreement, or the subject matter hereof, may
not be enforced in or by such courts.

     Section 8.9 Enforcement. The parties agree that irreparable damage would occur in the
event that any of the provisions of this License Agreement were not performed in accordance with
their specific terms or were otherwise breached. Accordingly, each of the parties shall be
entitled to specific performance of the terms hereof, including an injunction or injunctions to
prevent breaches of this License Agreement and to enforce specifically the terms and provisions of
this License Agreement in any federal court sitting in the Borough of Manhattan in the City of New
York (or, if such court lacks subject matter jurisdiction, in any appropriate New York State or
federal court), this being in addition to any other remedy to which such party is entitled at law
or in equity. Each of the parties hereby further waives (a) any defense in any action for specific
performance that a remedy at law would be adequate and (b) any requirement under any law to post
security as a prerequisite to obtaining equitable relief.

     Section 8.10 Severability. Whenever possible, each provision or portion of any
provision of this License Agreement shall be interpreted in such manner as to be effective and
valid under applicable Law, but if any provision or portion of any provision of this License
Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable Law
or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any
other provision or portion of any provision in such jurisdiction, and this License Agreement shall
be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had never been contained herein.

     Section 8.11 Waiver of Jury Trial. EACH OF THE PARTIES TO THIS LICENSE AGREEMENT
HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR RELATING TO THIS LICENSE AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

     Section 8.12 Counterparts. This License Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same instrument and shall become
effective when one or more counterparts have been signed by each of the parties and delivered to
the other parties.

     Section 8.13 Facsimile Signature. This License Agreement may be executed by facsimile
signature and a facsimile signature shall constitute an original for all purposes.

13

 

     Section 8.14 Effect if Distribution Does Not Occur. If the Distribution does not
occur, then this License Agreement shall automatically be terminated and all actions and events
that are, under this License Agreement, to be taken or occur effective as of the Distribution, or
otherwise in connection with the Distribution shall not be taken or occur except to the extent
specifically agreed by the parties.

[The remainder of this page is intentionally left blank.]

14

 

     IN WITNESS WHEREOF, the parties have caused this License Agreement to be executed as of the
date first written above by their respective officers thereunto duly authorized.

	 	 	 	 	 
	 	NORTHROP GRUMMAN SYSTEMS CORPORATION

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	NORTHROP GRUMMAN SHIPBUILDING, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

[Signature Page to Intellectual Property License Agreement]exv10w4

EXHIBIT 10.4

 

TAX MATTERS AGREEMENT

by and between

NEW P, INC.

(to be renamed NORTHROP GRUMMAN CORPORATION)

and

HUNTINGTON INGALLS INDUSTRIES, INC.

Dated as of __________, 2011

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 

	ARTICLE 1 DEFINITIONS
	 	 	2	 
	Section 1.1 Definitions
	 	 	2	 
	Section 1.2 Table of Additional Defined Terms
	 	 	7	 
	 
	 	 	 	 
	ARTICLE 2 PREPARATION AND FILING OF TAX RETURNS, PAYMENT OF TAXES DUE AFTER THE
DISTRIBUTION DATE, AND ADJUSTMENT REQUESTS
	 	 	7	 
	Section 2.1 Current Tax Group Federal Consolidated Returns
	 	 	7	 
	Section 2.2 New NGC Non-Federal Tax Returns
	 	 	7	 
	Section 2.3 HII Tax Returns
	 	 	8	 
	Section 2.4 Tax Return Procedures
	 	 	8	 
	Section 2.5 Adjustment Requests
	 	 	8	 
	 
	 	 	 	 
	ARTICLE 3 GENERAL INDEMNIFICATION FOR TAXES
	 	 	8	 
	Section 3.1 Indemnification by New NGC
	 	 	8	 
	Section 3.2 Indemnification by HII
	 	 	9	 
	 
	 	 	 	 
	ARTICLE 4 REFUNDS AND CARRYBACKS
	 	 	9	 
	Section 4.1 Refunds
	 	 	9	 
	Section 4.2 Carrybacks
	 	 	9	 
	 
	 	 	 	 
	ARTICLE 5 TAX PROCEEDINGS
	 	 	11	 
	Section 5.1 Control of Tax Proceedings
	 	 	11	 
	Section 5.2 Notices Relating to Tax Proceedings
	 	 	12	 
	Section 5.3 Statute of Limitations
	 	 	12	 
	 
	 	 	 	 
	ARTICLE 6 PAYMENTS BETWEEN THE PARTIES FOR CERTAIN INCOME TAX ADJUSTMENTS
	 	 	13	 
	Section 6.1 Payments by HII to New NGC
	 	 	13	 
	Section 6.2 Payments by New NGC to HII
	 	 	14	 
	Section 6.3 Threshold Amount
	 	 	14	 
	Section 6.4 Separate Entity Provisions
	 	 	15	 
	Section 6.5 Acknowledgement
	 	 	15	 
	 
	 	 	 	 
	ARTICLE 7 ALLOCATION, CHARACTER, AND TREATMENT OF CERTAIN TAX ITEMS AND TRANSACTIONS
	 	 	16	 
	Section 7.1 Allocation of Certain Tax Items
	 	 	16	 
	Section 7.2 Tax Treatment of Payments between the Parties
	 	 	16	 
	Section 7.3 Tax Treatment of Novations of Shipbuilding Liabilities and Retained
Liabilities
	 	 	17	 
	Section 7.4 Tax Treatment of Equity-Related Compensation
	 	 	17	 
	Section 7.5 Accounting Methods
	 	 	18	 
	Section 7.6 Indemnification for Taking Contrary Tax Treatment
	 	 	19	 
	Section 7.7 Tax Attributes
	 	 	20	 

 

 

TABLE OF CONTENTS

(Continued)

	 	 	 	 	 

	ARTICLE 8 TAX-FREE STATUS OF THE TRANSACTIONS
	 	 	20	 
	Section 8.1 Covenants, Undertakings, Agreements, Representations, and
Warranties
	 	 	20	 
	Section 8.2 Restrictions Relating to the Distribution
	 	 	22	 
	Section 8.3 Procedures Regarding Rulings and Opinions
	 	 	25	 
	Section 8.4 Indemnification
	 	 	26	 
	 
	 	 	 	 
	ARTICLE 9 COOPERATION
	 	 	26	 
	Section 9.1 General Cooperation
	 	 	26	 
	Section 9.2 Retention of Records
	 	 	27	 
	Section 9.3 Confidentiality
	 	 	27	 
	 
	 	 	 	 
	ARTICLE 10 MISCELLANEOUS
	 	 	28	 
	Section 10.1 Timing of Payments; Interest
	 	 	28	 
	Section 10.2 Dispute Resolution
	 	 	28	 
	Section 10.3 Survival of Covenants
	 	 	29	 
	Section 10.4 Termination of Agreements, Arrangements and Policies
	 	 	29	 
	Section 10.5 Severability
	 	 	29	 
	Section 10.6 Entire Agreement
	 	 	29	 
	Section 10.7 Assignment
	 	 	30	 
	Section 10.8 No Third-Party Beneficiaries
	 	 	30	 
	Section 10.9 Specific Performance
	 	 	30	 
	Section 10.10 Amendment
	 	 	30	 
	Section 10.11 Rules of Construction
	 	 	30	 
	Section 10.12 Notices
	 	 	31	 
	Section 10.13 Counterparts
	 	 	32	 
	Section 10.14 Coordination with the Employee Matters Agreement
	 	 	32	 
	Section 10.15 Conflict or Inconsistency Between Agreements
	 	 	32	 
	Section 10.16 Termination of this Agreement
	 	 	32	 

ii

 

TAX MATTERS AGREEMENT

     THIS TAX MATTERS AGREEMENT, dated as of [_____], 2011 (this “Agreement”), is made by
and between NEW P, INC., a Delaware corporation (“New NGC”) and HUNTINGTON INGALLS
INDUSTRIES, INC., a Delaware corporation (“HII”). Each of New NGC and HII is sometimes
referred to herein as a “Party” and, collectively,
as the “Parties.”

RECITALS

     A. Northrop Grumman Corporation (“NGC”), a Delaware corporation, acting through itself
and its direct and indirect Subsidiaries, currently conducts the Shipbuilding Business and the
Retained Business.

     B. The board of directors of NGC has determined that it is appropriate, desirable and in the
best interests of NGC and its stockholders to separate NGC into two publicly traded companies:
(a) HII, which following the Distribution, will own and conduct, directly and indirectly, the
Shipbuilding Business; and (b) New NGC, which, following the Distribution, will own and conduct,
directly and indirectly, the Retained Business.

     C. NGC and the Parties have entered into the Separation and Distribution Agreement, dated as
of [_____], 2011 (the “Separation and Distribution Agreement”), pursuant to which they will
undertake the Holding Company Reorganization, the Internal Reorganization, and the Distribution
(each as defined in the Separation and Distribution Agreement) (collectively, the
“Transactions”).

     D. NGC and the Parties have entered into the Ancillary Agreements (as defined in the
Separation and Distribution Agreement), pursuant to which they will undertake certain other
transactions and arrangements relating to the separation of the Shipbuilding Business from the
Retained Business.

     E. Prior to the Distribution, NGC will be renamed “Titan II Inc.” and New NGC will be renamed
“Northrop Grumman Corporation.”

     F. NGC is the common parent of an affiliated group of corporations that files a consolidated
U.S. federal income tax return (the “Current Tax Group”).

     G. Following the Distribution, HII will be the common parent of an affiliated group of
corporations that files a consolidated U.S. federal income tax return (the “HII Tax
Group”).

     H. Following the Distribution, the Current Tax Group will remain in existence with New NGC as
its common parent and with all of its previous members other than the HII Group Members.

     I. The Parties intend that, for U.S. federal Income Tax purposes, the Transactions shall
qualify for Tax-Free Status pursuant to Sections 351, 355, 361, 368(a) and related provisions of
the Code, and, in furtherance of such intent NGC has obtained the IRS Ruling and entered into the
IRS Closing Agreement.

1

 

     J. The Parties wish to provide for the payment of tax liabilities and entitlement to refunds
thereof, to allocate responsibility for, and cooperation in, the filing of Tax Returns, to set
forth certain covenants, undertakings, agreements, representations, warranties, and indemnities
relating to the Tax-Free Status of the Transactions, and to provide for certain other matters
relating to Taxes.

AGREEMENT

     In consideration of the foregoing and the mutual covenants and agreements herein contained,
and intending to be legally bound hereby, the Parties agree as follows:

ARTICLE 1

DEFINITIONS

          Section 1.1 Definitions.

     For the purposes of this Agreement:

     “Accounting Method” means a method of accounting under Section 446 of the Code.

     “Adjustment Request” means any formal or informal written claim or request made to a
Tax Authority by an NGC Group Member, a New NGC Group Member, or an HII Group Member for an
adjustment to Taxes, whether such adjustment is positive or negative (by refund, credit, offset, or
otherwise), including (i) an amended Tax Return claiming an adjustment to Taxes as reported on the
originally filed Tax Return or, if applicable, as previously adjusted or (ii) a self-initiated
adjustment or similar claim made, during the course of a Tax Proceeding or otherwise. Such term
shall not include an adjustment to Tax initiated by a Tax Authority during a Tax Proceeding.

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

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

     “Code” means the Internal Revenue Code of 1986, as amended.

     “Current Tax Group Federal Consolidated Return” means a U.S. federal Income Tax Return
filed or required to be filed by NGC or New NGC as the common parent of the Current Tax Group.

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

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

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

2

 

     “Final Determination” means the final resolution of liability for any Tax, for any
issue and for any taxable period, by or as a result of (i) IRS Form 870-AD (or any successor form)
or a comparable form under any state, local or foreign law on the date of acceptance by or on
behalf of the relevant Tax Authority, except that a Form 870-AD or comparable form that reserves
the right of the taxpayer to file a claim for refund and/or the right of the Tax Authority to
assert a further deficiency shall not constitute a Final Determination with respect to the item or
items so reserved, (ii) a final decision, judgment, decree or other order by any court of competent
jurisdiction that can no longer be appealed or reheard, (iii) a closing agreement or similar
agreement entered into with a Tax Authority in connection with an administrative or judicial
proceeding, (iv) an allowance of a refund or credit in respect of an overpayment of Tax, but only
after the expiration of all periods during which such refund or credit may be recovered by the
jurisdiction imposing the Tax, (v) any other final resolution, including by reason of the
expiration of the applicable period of limitations or the execution of a pre-filing agreement with
the applicable Tax Authority, or (vi) the occurrence of any event which the parties agree in
writing is a Final Determination.

     “HII Group” means, for any relevant time beginning immediately after the Distribution,
HII and each Subsidiary of HII at such time.

     “HII Group Member” means HII, each Person that is a Subsidiary of HII immediately
after the Distribution (including NGC), and each Person that becomes a Subsidiary of HII after the
Distribution.

     “HII Tax Return” means a Tax Return filed or required to be filed by an HII Group
Member after the Distribution Date (for the avoidance of doubt, excluding a New NGC Non-Federal Tax
Return and a Current Tax Group Federal Consolidated Return).

     “Holding Company Reorganization” has the meaning set forth in the Separation and
Distribution Agreement.

     “Income Tax” means a Tax based upon, measured by, or calculated with respect to
(i) net income or profits or net receipts (including, but not limited to, any capital gains,
minimum Tax or any Tax on items of Tax preference, but not including sales, use, real or personal
property, or transfer or similar Taxes) or (ii) multiple bases (including corporate franchise,
doing business and occupation Taxes) if one or more bases upon which such Tax may be based, by
which such Tax may be measured, or with respect to which such Tax may be calculated, is described
in clause (i).

     “Income Tax Adjustment” means any change in any Income Tax Item, whether resulting
from a Tax Proceeding or an Adjustment Request; provided, however, that a claim for
refund resulting from a carryback of a loss, credit or other Tax Attribute in a Post-Distribution
Taxable Period to a Pre-Distribution Taxable Period or a Straddle Taxable Period is not an Income
Tax Adjustment.

     “Income Tax Item” means any item of income, gain, loss, deduction, credit, recapture
of credit, or any other item (including the adjusted basis of property) relating to the
determination of Income Taxes payable in any Taxable Period.

3

 

     “Income Tax Return” means any Tax Return relating to Income Taxes.

     “Independent Firm” means a nationally recognized law firm or accounting firm which, at
the relevant time, does not provide, and within the preceding two years has not provided,
substantial services to either of the Parties.

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

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

     “IRS” means the U.S. Internal Revenue Service or any successor thereto.

     “IRS Closing Agreement” means the closing agreement entered into between NGC (as
parent of the Current Tax Group) and the IRS in connection with the IRS Ruling and with the
Transactions.

     “IRS Ruling” means the U.S. federal income tax private letter ruling, and any
supplement thereto, issued to NGC by the IRS in connection with the Transactions.

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

     “Member” means HII Group Member or New NGC Group Member, as the case may be.

     “New NGC Group” means, for any relevant time beginning immediately after the
Distribution, New NGC and each Subsidiary of New NGC at such time.

     “New NGC Group Member” means New NGC, each Person that is a Subsidiary of New NGC
immediately after the Distribution, and each Person that becomes a Subsidiary of New NGC after the
Distribution.

     “New NGC Non-Federal Tax Return” means a Tax Return (other than a Current Tax Group
Federal Consolidated Return) (i) that is filed or required to be filed by a New NGC Group Member
after the Distribution Date or (ii) that is filed or required to be filed after the Distribution
Date and includes an Income Tax Item or an asset of a New NGC Group Member, or otherwise relates to
the Retained Business (which shall include a Tax Return that is required to be filed after the
Distribution Date that includes an Income Tax Item or an asset of a New NGC Group Member and an
Income Tax Item or an asset of an HII Group Member).

     “NGC Group” means, for any relevant time ending immediately before the Holding Company
Reorganization, NGC and each Subsidiary of NGC at such time.

     “NGC Group Member” means NGC and each Subsidiary of NGC at any time before the Holding
Company Reorganization.

     “NGC Non-Federal Tax Return” means a Tax Return, other than a Current Tax Group
Federal Consolidated Return, required to be filed by an NGC Group Member prior to or on the
Distribution Date.

4

 

     “Opinion” means the opinion of Tax Counsel with respect to certain Tax aspects of the
Transactions.

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

     “Pre-Distribution Taxable Period” means any Taxable Period (or portion thereof) ending
on or before the Distribution Date.

     “Post-Distribution Taxable Period” means any Taxable Period (or portion thereof)
beginning after the Distribution Date.

     “Refund” means any refund of Taxes (including any overpayment of Taxes that can be
refunded or, alternatively, applied to other Taxes payable), including any interest paid on or with
respect to such refund of Taxes.

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

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

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

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

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

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

     “Straddle Taxable Period” means a Taxable Period that begins on or before and ends
after the Distribution Date.

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

     “Tax” means (i) a tax, charge, fee, duty, levy, impost or other similar assessment,
imposed by any U.S. federal, state or local or foreign governmental authority, including, but not
limited to, income, gross receipts, excise, property, sales, use, license, stock, franchise,
payroll, employment, withholding, social security, transfer, value added and other taxes,
(ii) interest attributable thereto, (iii) a penalty or addition attributable thereto or to a
failure to file a Tax Return or a form, schedule or information properly includible thereon, and
(iv) a liability in respect of any item described in clause (i), (ii) or (iii), payable by reason
of assumption, transferee or successor liability, operation of Law or several liability pursuant to
Treasury Regulations Section 1.1502-6(a).

5

 

     “Tax Attribute” means a net operating loss, capital loss, earnings and profits,
overall foreign loss, previously taxed income, separate limitation loss, and any other Tax
attribute.

     “Tax Authority” means a governmental authority or subdivision, agency, commission or
entity thereof or a quasi-governmental or private body having jurisdiction over the assessment,
determination, collection or imposition of a Tax (including the IRS).

     “Tax Counsel” means Ivins, Phillips & Barker, Chartered.

     “Tax-Free Status” means the Tax treatment accorded to the Transactions as set forth in
the IRS Ruling and the Opinion.

     “Tax Group” means any U.S. federal, state, local or foreign affiliated, consolidated,
combined, unitary or similar group or fiscal unity that joins in the filing of a single Tax Return.

     “Tax Materials” means, collectively, (i) the IRS Ruling, (ii) the IRS Closing
Agreement, (iii) each submission to the IRS in connection with the IRS Ruling, (iv) the Opinion,
(v) the representation letters from NGC, New NGC and HII, addressed to Tax Counsel supporting the
Opinion, and (vi) any other materials delivered or deliverable by NGC, New NGC or HII in connection
with the issuance of the IRS Ruling, the negotiation, drafting, execution and approval of the IRS
Closing Agreement and the rendering of the Opinion.

     “Tax Proceeding” means any audit, examination, investigation, action, suit, claim,
assessment, appeal, Adjustment Request, or other administrative or judicial proceeding relating to
Taxes.

     “Tax Return” means (i) a return, report, certificate, form or similar statement or
document (including any related or supporting information or schedule attached thereto and any
information return, or declaration of estimated Tax) required to be supplied to, or filed with, a
Tax Authority in connection with the payment, determination, assessment or collection of a Tax or
the administration of a Law relating to a Tax or (ii) an amended Tax Return.

     “Tax Sharing Dispute” means a dispute arising in connection with this Agreement
between the Parties (not including a Tax Proceeding, except as provided in Section 5.1).

     “Taxable Period” means any period for which a liability for Tax is determined.

     “Transactions Tax” means a Tax imposed on the Holding Company Reorganization, the
Internal Reorganization, or the Distribution, or by reason of a failure of the Holding Company
Reorganization, the Internal Reorganization, or the Distribution to qualify for Tax-Free Status
(including an intercompany transaction triggered by reason of such failure).

     “Treasury Regulations” means the final and temporary (but not proposed) Income Tax
regulations promulgated under the Code, as such regulations may be amended from time to time.

     “Unqualified Tax Opinion” means a “will” opinion, without substantive qualification,
rendered by a nationally recognized law firm, which law firm is reasonably acceptable to New

6

 

NGC, to the effect that a transaction or event, or a series of transactions and/or events,
will not affect the Tax-Free Status of the Transactions.

          Section 1.2 Table of Additional Defined Terms.

     The following terms have the meanings set forth in the Sections referenced below:

	 	 	 	 	 
	Definition	 	 	Section
	Agreement
	 	Preamble
	Carryback Election Request
	 	Section 4.2(b)(i)
	Current Tax Group
	 	Recital F
	HII
	 	Preamble
	HII Restricted Action
	 	Section 8.2(c)
	HII Tax Group
	 	Recital G
	New NGC
	 	Preamble
	NGC
	 	Recital A
	Parties
	 	Preamble
	Party
	 	Preamble
	Payee Party
	 	Section 6.3(a)
	Payor Party
	 	Section 6.3(a)
	Restriction Period
	 	Section 8.2(c)
	Separation and Distribution Agreement
	 	Recital C
	Tax Arbitrator
	 	Section 10.2(b)
	Threshold Amount
	 	Section 6.3(a)
	Transactions
	 	Recital C

ARTICLE 2

PREPARATION AND FILING OF TAX RETURNS,

PAYMENT OF TAXES DUE AFTER THE DISTRIBUTION DATE,

AND ADJUSTMENT REQUESTS

          Section 2.1 Current Tax Group Federal Consolidated Returns.

     New NGC shall prepare and file all Current Tax Group Federal Consolidated Returns required to
be filed after the Distribution Date. New NGC shall pay all Taxes shown payable on all Current Tax
Group Federal Consolidated Returns filed or required to be filed after the Distribution Date.

          Section 2.2 New NGC Non-Federal Tax Returns.

     New NGC shall prepare and file, or cause the relevant New NGC Group Member to prepare and
file, all New NGC Non-Federal Tax Returns. New NGC shall pay or cause such New NGC Group Member to
pay to the appropriate Tax Authority all Taxes shown as payable on all New NGC Non-Federal Tax
Returns.

7

 

          Section 2.3 HII Tax Returns.

     HII shall prepare and file, or cause the relevant HII Group Member to prepare and file, all
HII Tax Returns. HII shall pay or cause such HII Group Member pay to the appropriate Tax Authority
all Taxes shown as payable on all HII Tax Returns.

          Section 2.4 Tax Return Procedures.

     (a) In connection with the preparation of any Current Tax Group Federal Consolidated Return to
be filed pursuant to Section 2.1 or any New NGC Non-Federal Tax Return filed pursuant to Section
2.2, HII shall, at its own cost and expense, provide pro forma Tax Returns or equivalent financial
data for HII and any relevant HII Group Member to be used in the preparation of such Tax Returns,
in accordance with past practices, procedures, Accounting Methods, elections, and conventions, and
shall assist and cooperate with New NGC in any other manner reasonably requested by New NGC.

     (b) On behalf of itself and each HII Group Member, HII hereby designates New NGC as their
agent to take any and all actions necessary or incidental to the preparation and filing by New NGC
of all New NGC Non-Federal Tax Returns and Current Tax Group Federal Consolidated Returns (subject
to the IRS Closing Agreement).

     (c) In connection with the preparation of any HII Tax Return filed pursuant to Section 2.3,
New NGC shall, at its own cost and expense, assist and cooperate with HII in any manner reasonably
requested by HII.

     (d) Except as otherwise provided, each Party shall bear its own expenses incurred in
connection with this ARTICLE 2.

          Section 2.5 Adjustment Requests.

     (a) New NGC Adjustment Requests. New NGC shall, in its sole discretion, be permitted
to make an Adjustment Request relating to an NGC Non-Federal Tax Return, a Current Tax Group
Federal Consolidated Return or a New NGC Non-Federal Tax Return, subject, in each case, to ARTICLE
5.

     (b) HII Adjustment Requests. HII shall, in its sole discretion, be permitted to make
an Adjustment Request relating to any HII Tax Return.

ARTICLE 3

GENERAL INDEMNIFICATION FOR TAXES

          Section 3.1 Indemnification by New NGC.

     New NGC shall pay, and shall indemnify and hold each HII Group Member harmless from and
against, (a) Taxes shown as payable on, and any increase in Taxes payable with respect to, NGC
Non-Federal Tax Returns, Current Tax Group Federal Consolidated Returns, and New NGC Non-Federal
Tax Returns and (b) any other Taxes payable by New NGC Group Members

8

 

or relating to the Retained
Business; provided, however, that New NGC’s obligations pursuant to this Section
3.1 are separate from New NGC’s obligations to HII pursuant to Section 6.2, Section 7.6, and
Section 8.4(b); provided further, that New NGC’s obligations pursuant to this
Section 3.1 shall not affect HII’s obligations to New NGC pursuant to Section 6.1, Section 7.6, or
Section 8.4(a).

          Section 3.2 Indemnification by HII.

     HII shall pay, and shall indemnify and hold each New NGC Group Member harmless from and
against, (a) Taxes shown as payable on, and any increase in Taxes payable with respect to, HII Tax
Returns and (b) any other Taxes payable by HII Group Members or relating to the Shipbuilding
Business for any Post-Distribution Tax Period; provided, however, that HII’s
obligations pursuant to this Section 3.2 are separate from HII’s obligations to New NGC pursuant to
Section 6.1, Section 7.6, and Section 8.4(a); provided further that HII’s
obligations pursuant to this Section 3.2 shall not affect New NGC’s obligations to HII pursuant to
Section 6.2, Section 7.6, or Section 8.4(b).

ARTICLE 4

REFUNDS AND CARRYBACKS

          Section 4.1 Refunds.

     (a) New NGC shall be entitled to any Refund due with respect to an NGC Non-Federal Tax Return,
a Current Tax Group Federal Consolidated Return, and a New NGC Non-Federal Tax Return;
provided, however, that New NGC’s receipt of a Refund with respect to any such Tax
Return shall not affect New NGC’s obligations to HII pursuant to Section 6.2, Section 7.6, or
Section 8.4(b) and shall not affect HII’s obligations to New NGC pursuant to Section 6.1, Section
7.6, or Section 8.4(a). If a Refund due with respect to an NGC Non-Federal Tax Return, a Current
Tax Group Federal Consolidated Return, or a New NGC Non-Federal Tax Return is paid to an HII Group
Member by a Tax Authority, such Member shall remit such Refund to New NGC.

     (b) HII shall be entitled to any Refund due with respect to an HII Tax Return;
provided, however, that HII’s receipt of a Refund with respect to any such Tax
Return shall not affect HII’s obligations to New NGC pursuant to Section 6.1, Section 7.6, or
Section 8.4(a) and shall not affect New NGC’s obligations to HII pursuant to Section 6.2, Section
7.6, or Section 8.4(b). Except as provided in Section 4.2(b), if a Refund due with respect to an
HII Tax Return
is paid to a New NGC Group Member by a Tax Authority, such Member shall remit such Refund to
HII.

          Section 4.2 Carrybacks.

     (a) New NGC Carrybacks.

     (i) If the Current Tax Group or a New NGC Group Member realizes a loss, credit, or other
Tax Attribute that may be carried back to a Pre-Distribution Taxable Period or a Straddle
Taxable Period (whether by (i) electing to carry back such loss, credit, or other

9

 

Tax
Attribute to a Pre-Distribution Taxable Period or a Straddle Taxable Period, or (ii) not
electing to waive the carryback of such loss, credit, or other Tax Attribute to a
Pre-Distribution Taxable Period or a Straddle Taxable Period), the Current Tax Group or such
Member may, in its sole discretion, carry back such loss, credit, or other Tax Attribute to
such Pre-Distribution Taxable Period or a Straddle Taxable Period. HII shall cooperate with
New NGC in seeking any Refund resulting from such carryback, at New NGC’s cost and expense.
New NGC shall be entitled to any Refund resulting from a carryback pursuant to this Section
4.2(a)(i).

     (ii) Notwithstanding Section 4.2(a)(i), if by Law the New NGC Group or a New NGC Group
Member may utilize a loss, credit, or other Tax Attribute only by a carryback of such loss,
credit, or other Tax Attribute to a Pre-Distribution Taxable Period or a Straddle Taxable
Period, HII shall cooperate with New NGC in seeking any Refund resulting from such carryback,
at New NGC’s cost and expense. New NGC shall be entitled to any Refund resulting from a
carryback pursuant to this Section 4.2(a)(ii).

     (b) HII Carrybacks.

     (i) If the HII Group or an HII Group Member realizes a loss, credit or other Tax
Attribute in a Post-Distribution Taxable Period that may be carried back to a Pre-Distribution
Taxable Period or a Straddle Taxable Period (whether by (i) electing to carry back such loss,
credit, or other Tax Attribute to a Pre-Distribution Taxable Period or a Straddle Taxable
Period, or (ii) not electing to waive the carryback of such loss, credit, or other Tax
Attribute to a Pre-Distribution Taxable Period or a Straddle Taxable Period), and HII wishes
to carry back such loss, credit, or other Tax Attribute to a Pre-Distribution Taxable Period
or a Straddle Taxable Period, HII shall notify New NGC in writing of HII’s wish to carry back
such loss, credit, or other Tax Attribute (a “Carryback Election Request”). A
Carryback Election Request shall include a computation of the amount of such loss, credit, or
other Tax Attribute, and a certification by an appropriate officer of HII setting forth HII’s
belief (together with supporting analysis) that the Tax treatment of such loss, credit, or
other Tax Attribute is more likely than not correct. New NGC shall have sole discretion to
deny a Carryback Election Request.

     (ii) New NGC may consent to the carryback of a loss, credit, or other Tax Attribute set
forth in the Carryback Election Request upon New NGC’s determination (in its sole discretion)
that the Parties have agreed to (A) the procedures for carrying back such
loss, credit, or other Tax Attribute (including by making an Adjustment Request, at HII’s
cost and expense), and (B) the determination of the amount or portion of any Refund resulting
from such carryback that shall be paid to HII pursuant to this Section 4.2(b)(ii). To the
extent any Refund subject to this Section 4.2(b)(ii) is later reduced in a Final
Determination, the Parties shall use their best efforts to agree to the amount of such Refund
that HII shall repay to New NGC, together with any interest, fines, additions to Tax,
penalties, or any additional amounts imposed by a Tax Authority relating thereto.

     (iii) Notwithstanding Section 4.2(b)(ii), if by Law the HII Group or an HII Group Member
may utilize a loss, credit, or other Tax Attribute only by a carryback of such loss, credit,
or other Tax Attribute from a Post-Distribution Taxable Period to a New NGC

10

 

Non-Federal Tax
Return or an NGC Non-Federal Tax Return for a Pre-Distribution Taxable Period or a Straddle
Taxable Period, New NGC shall cooperate with HII in carrying back such loss, credit, or other
Tax Attribute (including by filing of an amended Current Tax Group Federal Consolidated Tax
Return, NGC Non-Federal Tax Return, or New NGC Non-Federal Tax Return or making an Adjustment
Request with respect to any such Tax Return, which shall be at HII’s cost and expense). The
Parties shall use their best efforts to agree to the procedures for determining the final
amount or portion of any Refund resulting from the carryback of such loss, credit, or other
Tax Attribute that shall be paid to HII pursuant to this Section 4.2(b)(iii). To the extent
any Refund subject to this Section 4.2(b)(iii) is later reduced in a Final Determination, the
Parties shall use their best efforts to agree to the amount of such Refund that HII shall
repay to New NGC, together with any interest, fines, additions to Tax, penalties, or any
additional amounts imposed by a Tax Authority relating thereto.

ARTICLE 5

TAX PROCEEDINGS

          Section 5.1 Control of Tax Proceedings.

     (a) Control by New NGC.

     (i) New NGC shall be entitled to control and settle any Tax Proceeding relating to (A)
an NGC Non-Federal Tax Return; (B) a Current Tax Group Federal Consolidated Return, or (C) a
New NGC Non-Federal Tax Return (including, in each case, any Tax Proceedings relating to a
Transactions Tax).

     (ii) On behalf of itself and each HII Group Member, HII hereby designates New NGC as
their agent to take any and all actions necessary or incidental to the control and
settlement of any Tax Proceeding relating to (A) an NGC Non-Federal Tax Return; (B) a
Current Tax Group Federal Consolidated Return (subject to the IRS Closing Agreement), or (C)
a New NGC Non-Federal Tax Return (including, in each case, any Tax Proceedings relating to a
Transactions Tax).

     (iii) If a settlement of a Tax Proceeding within the control of New NGC (or an action
proposed to be taken with respect thereto) reasonably could be expected to give rise to a
payment by HII pursuant to Section 6.1, Section 7.6, or Section 8.4(a), or could
be expected to give rise to a payment to HII pursuant to Section 6.2, Section 7.6, or
Section 8.4(b), then New NGC shall provide copies of all correspondence and all filings to
be submitted to a Tax Authority or judicial authority in connection with such Tax Proceeding
for review by HII prior to submission to the Tax Authority or judicial authority; provided,
however, that failure by New NGC to provide such correspondence to HII shall not relieve HII
of any obligation pursuant to Section 6.1, Section 7.6, or Section 8.4(a), except to the
extent HII is actually prejudiced by such failure.

     (iv) New NGC shall provide written notice to HII of any settlement with a Tax Authority
that reasonably could be expected to give rise to a payment by HII pursuant to Section 6.1,
Section 7.6, or Section 8.4(a), or a payment to HII pursuant to Section 6.2,

11

 

Section 7.6, or
Section 8.4(b). HII shall not have the right to prevent any such settlement but shall have
the right to contest the amount of its liability to New NGC pursuant to Section 6.1, Section
7.6, or Section 8.4(a) or the amount of its payment from New NGC pursuant to Section 6.2,
Section 7.6, or Section 8.4(b) resulting from such settlement. HII shall provide written
notice to New NGC of its intention to contest the amount of the amount of its liability to
New NGC pursuant to Section 6.1, Section 7.6, or Section 8.4(a) or the amount of its payment
from New NGC pursuant to Section 6.2, Section 7.6, or Section 8.4(b) prior to the time such
settlement is entered into (but in any event HII shall have no less than 10 days from the
time it receives notice of such settlement from New NGC to provide notice to New NGC of its
intent to contest such settlement). Any such contest by HII shall be conducted as a Tax
Sharing Dispute under the procedures set forth in Section 10.2. If the negotiations
required thereby are not successful, the Tax Arbitrator shall determine the amount of a
settlement with the relevant Tax Authority that would most accurately reflect the litigation
risk of the relevant issue. HII shall be liable to New NGC, or NGC shall be liable to HII,
as the case may be, based solely on the determination of the Tax Arbitrator as if a
settlement implementing such determination had actually occurred, without regard to the
actual settlement between New NGC and the Tax Authority.

     (b) Control by HII. HII shall be entitled to control, contest, compromise and settle
any adjustment proposed, asserted or assessed pursuant to any Tax Proceeding relating to any HII
Tax Return.

          Section 5.2 Notices Relating to Tax Proceedings.

     Within 10 days after one Party (the “first Party”) becomes aware of the commencement of a Tax
Proceeding that may give rise to Taxes for which the other Party (the “second Party”) is
responsible pursuant to ARTICLE 3 or which may give rise to a payment obligation under ARTICLE 6,
Section 7.6, or Section 8.4, the first Party shall notify the second Party of such Tax Proceeding,
and thereafter shall promptly forward or make available to the second Party copies of notices and
communications relating to such Tax Proceeding. A failure by the first Party to notify the second
Party of the commencement of any such Tax Proceeding within such 10-day period or promptly forward
any further notices or communications shall not relieve the second Party of any obligation which it
may have pursuant to this Agreement except to the extent that the second Party is actually
prejudiced by such failure.

          Section 5.3 Statute of Limitations.

     Any extension of the statute of limitations for any Taxes or a Tax Return for any
Pre-Distribution Taxable Period or a Straddle Taxable Period may be made only by the Party required
to file such Tax Return pursuant to ARTICLE 2.

12

 

ARTICLE 6

PAYMENTS BETWEEN THE PARTIES FOR

CERTAIN INCOME TAX ADJUSTMENTS

          Section 6.1 Payments by HII to New NGC.

     (a) General. Except as otherwise provided in Section 7.6 and Section 8.4(a), upon a
Final Determination resulting in an Income Tax Adjustment to (i) a Current Tax Group Federal
Consolidated Return, (ii) an NGC Non-Federal Tax Return, or (iii) a New NGC Non-Federal Tax Return,
in each case for a Pre-Distribution Taxable Period or a Straddle Taxable Period, HII shall pay to
New NGC the amount set forth in Section 6.1(b) (subject to the limitations in Section 6.1(d) and
Section 6.3).

     (b) Payment by HII to New NGC for Income Tax Adjustments to Current Tax Group Federal
Consolidated Returns. In the event of an Income Tax Adjustment relating to an Income Tax Item
of an HII Group Member on a Current Tax Group Federal Consolidated Return for a Pre-Distribution
Taxable Period or a Straddle Taxable Period, the amount payable by HII to New NGC hereunder shall
be 35 percent of any increase, by reason of such Income Tax Adjustment, in (i) the taxable income
of such Member for such Pre-Distribution Taxable Period or Straddle Taxable Period (to the extent
attributable to the portion of such Straddle Period ending on or before the Distribution Date as
determined pursuant to Section 7.1(b)) over (ii) the taxable income of such Member that was
included in the determination of Tax shown as payable (or the Refund shown as due) on such Tax
Return, as last filed before the Distribution Date and modified by any subsequent Adjustment
Request made before the Distribution Date.

     (c) Tax Adjustments to NGC Non-Federal Tax Returns and New NGC Non-Federal Tax
Returns. Payments relating to adjustments for non-federal Taxes on NGC Non-Federal Tax Returns
and New NGC Non-Federal Tax Returns shall be determined solely in accordance with Section 8.7 of
the Separation and Distribution Agreement (relating to “Government Contract Matters”).

     (d) Limitation on Payment Obligation. An Income Tax Adjustment resulting in an
increase in taxable income of an HII Group Member for a Pre-Distribution Taxable Period or a
Straddle Taxable Period shall not result in a payment obligation by HII pursuant to Section 6.1(b),
unless such Income Tax Adjustment is of a nature that could result in a correlative reduction in
the taxable income of an HII Group Member for a Post-Distribution Taxable Period or Straddle
Taxable Period (to the extent attributable to the portion of such Straddle Taxable Period beginning
on or after the Distribution Date as determined pursuant to Section 7.1(b)). In determining
whether such an increase in taxable income of an HII Group Member is of a nature that could result
in a reduction in taxable income of an HII Group Member for a Post-Distribution Period or a
Straddle Period (to the extent attributable to the portion of the Straddle
Period beginning on or after the Distribution Date as determined pursuant to Section 7.1(b)),
the actual availability to the HII Group or such Member of any Tax benefit attributable thereto
(whether due to losses incurred by the HII Group in a Post-Distribution Taxable Period, Income Tax
Adjustments relating to non-depreciable, non-amortizable assets, or otherwise) shall not be taken
into account. This Section 6.1(d) shall not apply to any payment due under Section 7.6 or Section
8.4.

13

 

          Section 6.2 Payments by New NGC to HII.

     (a) General. Except as otherwise provided in Section 7.6 and Section 8.4(b), upon a
Final Determination resulting in an Income Tax Adjustment to (i) a Current Tax Group Federal
Consolidated Return, (ii) an NGC Non-Federal Tax Return, or (iii) a New NGC Non-Federal Tax Return,
in each case for a Pre-Distribution Taxable Period or a Straddle Taxable Period, New NGC shall pay
to HII the amount set forth in Section 6.2(b) (subject to the limitations in Section 6.2(d) and
Section 6.3).

     (b) Payment by New NGC to HII for Income Tax Adjustments to Current Tax Group Federal
Consolidated Returns. In the event of an Income Tax Adjustment relating to an Income Tax Item
of an HII Group Member on a Current Tax Group Federal Consolidated Return for a Pre-Distribution
Taxable Period or a Straddle Taxable Period, the amount payable by New NGC to HII hereunder shall
be 35 percent of any decrease, by reason of such Income Tax Adjustment, in (i) the taxable income
of such Member for such Pre-Distribution Taxable Period or Straddle Taxable Period (to the extent
attributable to the portion of such Straddle Period ending on or before the Distribution Date as
determined pursuant to Section 7.1(b)) from (ii) the taxable income of such Member that was
included in the determination of Tax shown as payable (or the Refund shown as due) on such Tax
Return, as last filed before the Distribution Date and modified by any subsequent Adjustment
Request made before the Distribution Date.

     (c) Tax Adjustments to NGC Non-Federal Tax Returns and New NGC Non-Federal Tax
Returns. Payments relating to adjustments for non-federal Taxes on NGC Non-Federal Tax Returns
and New NGC Non-Federal Tax Returns shall be determined solely in accordance with Section 8.7 of
the Separation and Distribution Agreement (relating to “Government Contract Matters”).

     (d) Limitation on Payment Obligations. An Income Tax Adjustment resulting in a
decrease in taxable income of an HII Group Member for a Pre-Distribution Taxable Period or a
Straddle Taxable Period shall not result in a payment obligation by New NGC pursuant to Section
6.2(b), unless such Income Tax Adjustment is of a nature that could result in a correlative
increase in the taxable income of an HII Group Member for a Post-Distribution Taxable Period or
Straddle Taxable Period (to the extent attributable to the portion of such Straddle Taxable Period
beginning on or after the Distribution Date as determined pursuant to Section 7.1(b)). In
determining whether such a decrease in taxable income of an HII Group Member is of a nature that
could result in an increase in taxable income of an HII Group Member for a Post-Distribution Period
or a Straddle Period (to the extent attributable to the portion of the Straddle Period beginning on
or after the Distribution Date as determined pursuant to Section 7.1(b)), the actual incurrence by
the HII Group or such Member of any Tax detriment
attributable thereto shall not be taken into account. This Section 6.2(d) shall not apply to
any payment due under Section 7.6 or Section 8.4.

          Section 6.3 Threshold Amount.

     (a) Neither Party shall have an obligation to make a payment under Section 6.1(a) and Section
6.2(a), unless and until the aggregate amount of payments otherwise due by such Party (the
“Payor Party”) to the other Party (the “Payee Party”) under Section 6.1(a) and
Section

14

 

6.2(a) exceeds by more than $2,000,000 (the “Threshold Amount”) the aggregate
amount of payments otherwise due by the Payee Party to the Payor Party under Section 6.1(a) and
Section 6.2(a)

     (b) Once the Threshold Amount is exceeded, the Payor Party shall be liable under Section
6.1(a) and Section 6.2(a) only for a payment or payments in excess of the Threshold Amount.

     (c) If after a payment becomes due under Section 6.1(a) and Section 6.2(a), a subsequent
payment becomes due under Section 6.1(a) and Section 6.2(a) by either the Payor Party or the Payee
Party (not taking account the Threshold Amount in this Section 6.3), the amount of the subsequent
payment due between the Parties shall be adjusted to effectuate the aggregate nature of the
Parties’ payment obligations under this Section 6.1(a) and Section 6.2(a), including the Threshold
Amount in this Section 6.3.

     (d) This Section 6.3 shall not apply to any payment due under Section 7.6 or Section 8.4.

          Section 6.4 Separate Entity Provisions.

     (a) For purposes of computing the taxable income of an HII Group Member in determining the
amount payable in Section 6.1 or Section 6.2:

     (i) each HII Group Member shall be treated as a stand-alone corporation that filed a
separate Income Tax Return based solely on the Income Tax Items and apportionment factors of
such Member (but reflecting elections and Accounting Methods used by the NGC Group for the
relevant Current Tax Group Federal Consolidated Return, NGC Non-Federal Tax Return, or New
NGC Non-Federal Tax Return);

     (ii) intercompany transactions between members of the Current Tax Group shall be taken
into account without regard to Treasury Regulation Section 1.1502-13 or any similar rule;

     (iii) no net operating loss, net capital loss, or other loss carryover or carryback
deduction shall be taken into account; and

     (iv) a decrease in an amount of net operating loss or capital loss shall be treated as
an increase in taxable income, and an increase in an amount of net operating loss or capital
loss shall be treated as a decrease in taxable income.

     (b) This
Section 6.4 shall not apply to any payment due under Section 7.6 or Section 8.4.

          Section 6.5 Acknowledgement.

     The Parties acknowledge and agree that the reason for the methodology for determining payments
as set forth in Section 6.1 or Section 6.2 is that the precise computation of actual Tax detriment
or Tax benefit resulting from an Income Tax Adjustment or combinations of Income

15

 

Tax Adjustments to
taxable income may be difficult or impossible to determine and that the payments provided for in
Section 6.1 or Section 6.2 are in lieu of any payments or indemnities relating to the actual amount
of adjustment to Taxes.

ARTICLE 7

ALLOCATION, CHARACTER, AND TREATMENT

OF CERTAIN TAX ITEMS AND TRANSACTIONS

          Section 7.1 Allocation of Certain Tax Items.

     (a) Allocation Between Taxable Periods. If applicable law requires the Taxable Period
of any HII Group Member that was a member of the Current Tax Group to end as of the close of the
Distribution Date, Income Tax Items shall be included in each Taxable Period in accordance with
Treasury Regulations Section 1.1502-76(b)(2)(i) with no election under Treasury Regulations Section
1.1502-76(b)(2)(ii).

     (b) Allocation Within a Straddle Taxable Period. If applicable law does not require
the Taxable Period of HII and each HII Group Member that was a member of the Current Tax Group to
end as of the close of the Distribution Date, then the amount of Income Tax Items attributable to
each portion of the Straddle Taxable Period shall be determined by means of a closing of the books
and records of such HII Group Member as of the close of the Distribution Date; provided,
however, that exemptions, allowances or deductions that are calculated on an annual or
periodic basis shall be allocated between such portions in proportion to the number of days in each
such portion.

     (c) Extraordinary Transactions. Notwithstanding anything to the contrary in this
Agreement, for all Tax purposes, the Parties shall report any transaction that is outside the
ordinary course of the normal day-to-day operations of the Shipbuilding Business that is
undertaken, caused, or permitted by any HII Group Member that occurs on the Distribution Date but
after the Distribution as occurring on the day after the Distribution Date pursuant to Treasury
Regulation Section 1.1502-76(b)(1)(ii)(B) or any similar or analogous provision of state, local or
foreign Law. New NGC shall not make a ratable allocation election pursuant to Treasury Regulation
Section 1.1502-76(b)(2)(ii)(D) or any similar or analogous provision of state, local or foreign
Law.

          Section 7.2 Tax Treatment of Payments between the Parties.

     (a) Payments Pursuant to this Agreement. Each Party covenants and agrees that it
will, and will cause each of its respective Subsidiaries to, treat (a) a payment by HII to New
NGC under Section 6.1, Section 7.6, or Section 8.4 as a distribution by HII to New NGC
immediately prior to the Distribution; (b) a payment by New NGC under Section 6.2, Section 7.6, or
Section 8.4 as a contribution by New NGC to HII immediately prior to the Distribution; and (c) a
payment by either Party of interest under Section 10.1 as taxable or deductible, as the case may
be, to the Party entitled to retain such payment or required pursuant to this Agreement to make
such payment, in either case except as otherwise required by applicable Law.

16

 

     (b) Payments Pursuant to Separation and Distribution Agreement and Ancillary
Agreements.

     (i) In General. Each Party covenants and agrees that it will, and will cause
each of its respective Subsidiaries to, treat an indemnity payment to the other Party
pursuant to the Separation and Distribution Agreement (other than payments made with respect
to Shared Gains or Shared Liabilities) or any Ancillary Agreement, to the extent
attributable to a Pre-Distribution Taxable Period or the portion of such Straddle Period
ending on or before the Distribution Date as determined pursuant to Section 7.1(b), as a
contribution by New NGC to HII or a distribution by HII to New NGC, as the case may be,
immediately prior to the Distribution.

     (ii) Shared Gains and Shared Liabilities. Consistent with Section 9.1, the
Parties shall consult and negotiate in determining the tax treatment of Shared Gains and
Shared Liabilities, as allocated in the Separation and Distribution Agreement, and of any
indemnity payments between the Parties with respect thereto. In such consultations and
negotiations, the Parties shall seek to achieve consistency in their respective Tax
treatment and reporting of such matters and, to the extent allowed by Law, Tax treatment
that is consistent with the economic benefits and burdens of such allocations and
indemnities.

     Section 7.3 Tax Treatment of Novations of Shipbuilding Liabilities and
Retained Liabilities.

     Each Party covenants and agrees that it will, and will cause each of its respective
Subsidiaries to, treat the novation of the Shipbuilding Liabilities and the Retained Liabilities
pursuant to Section 2.4 and 2.5 of the Separation and Distribution Agreement, respectively as (a) a
distribution by HII to New NGC immediately prior to the Distribution or (b) a contribution by New
NGC to HII immediately prior to the Distribution.

          Section 7.4 Tax Treatment of Equity-Related Compensation.

     (a) The Current Tax Group or a New NGC Group Member shall be entitled to claim any Tax
deduction relating to (i) the exercise of an option award to purchase New NGC stock, (ii) the
vesting of a restricted performance stock right award or restricted stock right award with respect
to New NGC stock, and (iii) the payment of a cash performance unit award with respect to New NGC
stock, in each case held by an employee or former employee of a New NGC Group Member at the time of
such exercise, vesting, or payment.

     (b) HII or an HII Group Member shall be entitled to claim any Tax deduction relating to (i)
the exercise of an option award to purchase HII stock, (ii) the vesting of a restricted
performance stock right award or restricted stock right award with respect to HII stock, and
(iii) the payment of a cash performance unit award with respect to HII stock, in each case held by
an employee or former employee of an HII Group Member at the time of such exercise, vesting, or
payment.

17

 

          Section 7.5 Accounting Methods.

     (a) No HII Group Member shall take any action with the IRS (whether by making an Adjustment
Request, filing a request for a change in Accounting Method, or otherwise) that would adversely
affect the application of any Accounting Method for any HII Group Member for any Pre-Distribution
Taxable Period, unless such action is required by the IRS in a Final Determination.

     (b) Each HII Group Member shall continue the use of any Accounting Method in effect
immediately prior to the Distribution Date for such Member (including the Accounting Methods
described in the IRS ruling letter dated February 26, 2010 relating to CVN 78), unless such Member
either (i) is required by the IRS to change such Accounting Method in a Post-Distribution Taxable
Period, or (ii) requests and receives consent from the IRS to change such Accounting Method in a
Post-Distribution Taxable Period.

     (c) Each HII Group Member shall continue the use of any Accounting Method agreed to by NGC or
New NGC and the IRS for such HII Group Member as a result of any Final Determination with respect
to Current Tax Group Federal Consolidated Returns for a Pre-Distribution Taxable Period or a
Straddle Taxable Period, unless such HII Group Member Group receives consent from, or is required
by, the IRS to change such Accounting Method in a Post-Distribution Taxable Period;
provided, however, that if such consent reasonably would be expected to have
material adverse impact on New NGC (including through an increase in Taxes or a reduction of a Tax
Attribute, regardless of whether or when such Tax Attribute otherwise would have been used), the
HII Tax Group (or such Member) shall not seek such consent.

     (d) Each HII Group Member that was granted permission by IRS to implement a change in
Accounting Method prior to the Distribution Date (including changes pursuant to IRS automatic
consent procedures) shall comply with all terms of the Accounting Method change consent agreement
or the terms imposed by the automatic consent procedure, including (i) the accounting method change
request relating to long-term contract accounting methods filed on behalf Northrop Grumman
Shipbuilding, Inc. on December 22, 2009 and for which consent was granted by the IRS in a ruling
letter dated July 19, 2010, and (ii) the automatic accounting method change, relating to contracts
with the Navy pursuant to Section 2203 of the Emergency Supplemental Appropriations Act for
Defense, the Global War on Terror, and Hurricane Recovery, 2006, Pub. L. No. 109-234, filed on
behalf of Northrop Grumman Shipbuilding, Inc. on January 27, 2010.

     (e) The Parties acknowledge and agree that any “long-term contract” (within the meaning of
Section 460(f) of the Code) being performed by any HII Group Member on the Distribution Date is
subject to Treasury Regulation Section 1.460-4(k)(3), relating to step-in-the-shoes transactions.

     (f) The Parties acknowledge and agree that any interest any HII Group Member owes to IRS, or
is owed by IRS, in a Post-Distribution Taxable Period under the look-back rules of Section
460(b)(2)(i) is payable by, or shall be payable to, respectively, such HII Group Member, and (ii)
shall not result in any payment obligation by either Party under ARTICLE 6,

18

 

notwithstanding the
fact that some period of contract performance covered by the look-back calculation occurred during
a Pre-Distribution Taxable Period or a Straddle Taxable Period.

     (g) The Parties acknowledge and agree that any adjustment to taxable income of any HII Group
Member in a Post-Distribution Taxable Period resulting from an adjustment under Section 481 of the
Code relating to an Accounting Method change effective as of a date prior to the Distribution Date
shall not result in any payment obligation by either Party under ARTICLE 6, notwithstanding the
fact that the adjustment period may have commenced in a Pre-Distribution Taxable Period or Straddle
Taxable Period.

     (h) The Parties acknowledge and agree that any adjustment to taxable income of any HII Group
Member in a Post-Distribution Taxable Period resulting from an adjustment under Section 481 of the
Code relating to an Accounting Method change effective as of a date subsequent to the Distribution
Date shall not result in any payment obligation by either Party under ARTICLE 6, notwithstanding
the fact that the adjustment may take into account the taxable income reported on an Accounting
Method in a Pre-Distribution Taxable Period or a Straddle Taxable Period.

     (i) The Parties acknowledge and agree that any increase in the tax liability of any HII Group
Member in a Post-Distribution Taxable Period resulting from the recapture of any tax benefit under
Section 708(b) of the American Jobs Creation Act of 2004, Pub. L. No. 108—357 shall not result in
any payment obligation by New NGC under Section 6.2, notwithstanding the fact that such recapture
may relate to taxable income of qualified naval ship contracts that would have been recognized by
such Member during a Pre-Distribution Taxable Period but for the application of Section 708(a)
thereof.

          Section 7.6 Indemnification for Taking Contrary Tax Treatment.

     (a) If either Party or any of its Subsidiaries fails to comply with any covenant, agreement,
or undertaking in this ARTICLE 7, such Party shall indemnify and hold harmless the other Party and
each of its Subsidiaries from and against any (i) increase in Taxes resulting from a Final
Determination that the treatment of a Income Tax Item differs from the treatment of such Income Tax
Item described in this ARTICLE 7 and (ii) legal, accounting, or other fees and expenses incurred in
connection with a Tax Proceeding relating to the treatment of such Income Tax Item.

     (b) For the purposes of this Section 7.6, any increase in Taxes shall be determined in
accordance with the methodology set forth in Section 6.1(b) and Section 6.1(c), on the one hand, or
Section 6.2(b) and Section 6.2(c), on the other; provided, however, that the
limitations under Section 6.1(d), Section 6.2(d), and Section 6.3 shall not apply to the
indemnities under this Section 7.6, it being the intention of the parties that any indemnity under
this Section 7.6 shall be determined without any minimum amount and without regard to the presence
or absence of any
possible future Tax benefit or Tax detriment to any member of the HII Group or any member of
the New NGC Group.

19

 

          Section 7.7 Tax Attributes.

     (a) New NGC shall cooperate with HII, each at its own cost and expense, in determining the
allocation of Tax Attributes between the Current Tax Group and the HII Tax Group arising in
Pre-Distribution Taxable Periods or Straddle Taxable Periods in accordance with the Code and
Treasury Regulations (and any applicable state, local, and foreign Laws). New NGC and HII hereby
agree to compute all Taxes for Post-Distribution Taxable Periods and Straddle Taxable Periods
consistently with that determination unless otherwise required by a Final Determination.

     (b) To the extent that the amount of any Tax Attribute is later reduced or increased by a Tax
Authority, Tax Proceeding, or carrybacks of Tax Attributes from Post-Distribution Taxable periods
of either the Current Tax Group or the HII Group, such reduction or increase shall be allocated to
the Party to which such Tax Attribute was allocated pursuant to Section 7.7(a).

ARTICLE 8

TAX-FREE STATUS OF THE TRANSACTIONS

     Section 8.1 Covenants, Undertakings, Agreements, Representations, and
Warranties.

     (a) HII Covenants, Undertakings, Agreements, Representations, and Warranties.

     (i) HII represents and warrants (A) that all the facts presented and representations
made in the Tax Materials (singly and in combination), to the extent descriptive of the HII
Group, any HII Group Member, or the actions or intentions of any of them, at all times have
been, and as of the date of this Agreement are, true, correct, fairly presented and complete
in all respects and are not misleading in any respect; and (B) that no HII Group Member is
aware of any respect in which any fact presented or representation made in the Tax Materials
(singly or in combination) is misleading in any respect or is other than true, correct,
fairly presented and complete in all respects.

     (ii) HII covenants, undertakes and agrees as follows:

     (A) Each HII Group Member shall use its best efforts to ensure that the facts
presented and representations made in the Tax Materials (singly and in combination)
will be true, correct, fairly presented and complete in all respects, and not
misleading in any respect, through and including the Distribution Date and
thereafter as relevant.

     (B) If an HII Group Member becomes aware that any fact presented or
representation made in the Tax Materials (singly or in combination) is, may be, or
may become misleading or other than true, correct, fairly presented and complete
in all respects, HII shall promptly notify the appropriate management personnel
of NGC (before the Distribution Date) or New NGC (after the Distribution Date) of

20

 

the situation in writing, and shall use its best efforts and fully cooperate in any
efforts by NGC and/or New NGC to correct the situation, all at its own expense.

     (C) No HII Group Member will take a position on a Tax Return (including on
Schedule UTP or any similar schedule or form) that could be reasonably likely to be
inconsistent in any respect with the rulings set forth in the IRS Ruling, the rights
and obligations set forth in the IRS Closing Agreement, the conclusions set forth in
the Opinion, or the Tax-Free Status of the Transactions.

	 	(b)	 	New NGC Covenants, Undertakings, Agreements, Representations, and Warranties.

     (i) New NGC represents and warrants (A) that it has delivered complete and accurate
copies of the Tax Materials to HII, (B) that all the facts presented and representations
made in the Tax Materials (singly and in combination) at all times have been, and are as of
the date of this Agreement, true, correct, fairly presented and complete in all respects,
and are not misleading in any respect, and (C) that no New NGC Group Member is aware of any
respect in which any fact presented or representation made in the Tax Materials (singly or
in combination) is misleading in any respect or is other than true, correct, fairly
presented and complete in all respects.

     (ii) New NGC covenants, undertakes and agrees as follows:

     (A) Each New NGC Group Member shall use its best efforts to ensure that the
facts presented and representations made in the Tax Materials (singly and in
combination) will be true, correct, fairly presented and complete in all respects,
and will not be misleading in any respect, through and including the Distribution,
and thereafter as relevant.

     (B) If a New NGC Group Member becomes aware that any fact presented or
representation made in the Tax Materials (singly or in combination) is, may be, or
may become misleading in any respect or other than true, correct, fairly presented
and complete in all respects, New NGC shall promptly inform the appropriate
management personnel of HII of the situation in writing, shall use its best efforts,
and shall fully cooperate in any efforts by HII, to correct the situation, all at
its own cost and expense.

     (C) No New NGC Group Member will take a position on a Tax Return (including on
Schedule UTP or any similar schedule or form) that could be reasonably likely to be
inconsistent in any respect with the rulings set forth in the IRS Ruling, the rights
and obligations set forth in the IRS Closing Agreement, the conclusions set forth in
the Opinion, or the Tax-Free Status of the Transactions.

     (c) No Contrary Knowledge. Each of New NGC and HII represents and warrants that it
knows of no fact (after due inquiry) that could be reasonably likely to cause the Tax treatment of
the Transactions to be other than the Tax-Free Status of the Transactions.

21

 

     (d) No Contrary Plan. Each of New NGC and HII represents and warrants that neither it
nor any of its Affiliates has any plan or intent to take any action that could be reasonably likely
to be inconsistent with any statement or representation in the Tax Materials.

          Section 8.2 Restrictions Relating to the Distribution.

     (a) General. Neither New NGC nor HII shall take, or permit any New NGC Group Member
or HII Group Member to take, any action that could be reasonably likely to be inconsistent with
any of the Tax Materials or to jeopardize all or any part of the Tax-Free Status of the
Transactions.

     (b) IRS Closing Agreement. Neither New NGC nor HII shall take, or permit any New
NGC Group Member or HII Group Member to take, any action that could be reasonably likely to be
inconsistent with any provision of the IRS Closing Agreement.

     (c) HII Restricted Actions. HII shall not take, and shall not permit any HII Group
Member to take, any action described in paragraphs (i) through (vi) (each a “HII Restricted
Action”) prior to the first day following the second anniversary of the Distribution (the
“Restriction Period”).

     (i) No Liquidation or Dissolution. HII shall not take, and shall not permit
any HII Group Member to take, any action that reasonably could be expected to result in a
dissolution or liquidation (including any action that is a liquidation for federal Income
Tax purposes, whether or not part of a reorganization within the meaning of Section 368(a)
of the Code) of any HII Group Member, except NGC, or a merger in which any HII Group Member,
except NGC, is a party but not the surviving corporation.

     (ii) Continuation of Shipbuilding Business. HII shall not take, and shall not
permit any HII Group Member to take, any action that could be reasonably likely to be
inconsistent with the continuation of the Shipbuilding Business as described in the Tax
Materials; provided, however, that the winding down or cessation of the HII
Group’s shipbuilding facilities in Avondale, Louisiana shall not be considered inconsistent
with the continuation of the Shipbuilding Business.

     (iii) Dispositions of Assets. HII shall not, and shall not permit any HII
Group Member to, sell, transfer, or otherwise dispose of or agree to, sell, transfer or
otherwise dispose (including in any transaction treated for federal Income Tax purposes as a
sale, exchange, transfer or disposition) of assets (including shares of stock of any HII
Group Member) in one or more transactions that, in the aggregate, could be reasonably likely
to constitute more than 30 percent of the gross assets of HII or the consolidated gross
assets of the HII Group. The percentage of gross assets of HII or the consolidated gross
assets of the HII Group, as the case may be, sold, transferred or otherwise disposed of,
shall be based on the fair market value of all relevant assets as of the Distribution Date,
or, if fair market value of any asset or group of assets is not readily determinable, based
on the net book value of such asset or group of assets under Generally Accepted Accounting
Principles, as of such date. The restrictions in this paragraph shall not apply to (A)
sales,
transfers or dispositions of assets for cash or cash equivalents in the ordinary course
of

22

 

normal day-to-day operations of the Shipbuilding Business; (B) acquisitions of assets
from unrelated Persons in arm’s-length transactions; (C) transfers of assets to Persons that
are disregarded as entities separate from the transferors for federal Income Tax purposes;
(D) mandatory or optional payments (including pre-payments) of interest or principal with
respect to indebtedness of an HII Group Member; (E) redemptions or repurchases of HII stock
or rights to acquire stock for cash or cash equivalents within the restrictions set forth in
Section 8.2(c)(iv); (F) normal quarterly dividends; or (G) sales of assets in connection
with the winding down and cessation of the HII Group’s shipbuilding facilities in Avondale,
Louisiana.

     (iv) Redemptions and Other Acquisitions of HII Stock. HII shall not redeem or
otherwise acquire (directly or through an Affiliate) any HII stock or rights to acquire
stock of HII, except to the extent that such acquisitions (separately and together with any
other such acquisitions) are within the limitations described in the IRS Ruling;
provided, however, that an acquisition of a right to acquire stock in a
transaction subject to Safe Harbor VIII of Treasury Regulations Section 1.355-7(d) shall not
constitute an HII Restricted Action.

     (v) Transactions Implicating Section 355(e) of the Code.

     (A) HII shall not enter into a transaction described in Section 8.2(c)(v)(B)
(and, to the extent any HII Group Member has the right or authority to prevent any
such transaction, shall not permit any such transaction to occur), if in the
aggregate such transactions could be reasonably likely to cause or permit one or
more Persons (whether or not acting in concert) to acquire, directly or indirectly,
a number of shares of HII stock that would, when combined with any other changes in
ownership of HII stock, comprise 40 percent or more of either (I) the value of all
outstanding shares of stock of HII as of the date of such transaction, or in the
case of a series of transactions, the date of the last transaction of such series,
or (II) the total combined voting power of all outstanding shares of voting stock of
HII as of the date of such transaction, or in the case of a series of transactions,
the date of the last transaction of such series. For purposes of this Section
8.2(c)(v), a reference to an acquisition of stock and any similar term or variation
thereof includes an agreement, understanding or arrangement, within the meaning of
Treasury Regulation Section 1.355-7 or any successor regulation or rule of law, to
enter into a transaction or series of transactions.

     (B) Subject to Section 8.2(c)(v)(C) and Section 8.2(c)(v)(D), a transaction is
described in this Section 8.2(c)(v)(B) if it is a transaction or part of a series of
transactions (or is an agreement, understanding or arrangement, within the meaning
of Treasury Regulation Section 1.355-7 or any successor regulation or rule of law,
to enter into a transaction or series of transactions) as a result of which (I) HII
or any HII Group Member would merge or consolidate with any other Person (except a
merger or consolidation of two HII Group Members), or (II) one or more Persons would
(directly or indirectly) acquire, or have the right to
acquire, shares of HII stock from HII and/or one or more holders of outstanding

23

 

shares of HII stock. Such a transaction constitutes an HII Restricted Action
regardless of whether it is supported by HII’s board of directors, management or
shareholders, is a hostile acquisition, or otherwise.

     (C) For purposes of Section 8.2(c)(v)(B), (I) a recapitalization, amendment to
a certificate of incorporation (or other organizational documents), or any other
action, whether through a stockholder vote or otherwise, affecting the relative
voting rights of stock (including through conversion of any stock into another class
of stock) shall be treated as an acquisition of stock, and (II) a redemption of
stock (directly or, as appropriate, indirectly through Affiliates) shall be treated
as an indirect acquisition of stock by the non-redeeming shareholders.

     (D) A transaction described in Section 8.2(c)(v)(B) shall not include (I) an
adoption by HII of a shareholder rights or “poison pill” plan (of the type described
in Revenue Ruling 90-11), (II) an acquisition of HII stock that satisfies Safe
Harbor VII of Treasury Regulations Section 1.355-7(d) or (III) an issuance of stock
or a grant of an option to acquire stock by HII that satisfies Safe Harbor VIII or
Safe Harbor IX of such regulation.

     (vi) Section 355(a)(1)(B) of the Code. HII shall not take any action or
actions and, to the extent any HII Group Member has the right or authority to prevent such
action, shall not permit any action (in either case, whether or not inconsistent with any of
the Tax Materials), if, in the aggregate, such actions could be reasonably likely to cause
or permit one or more Persons (whether or not acting in concert) to dispose, directly or
indirectly, of a number of shares of HII stock that, when combined with any other changes in
ownership of HII stock pertinent for purposes of Section 355(a)(1)(B) of the Code, could be
reasonably likely to comprise 20 percent or more of the value of all of the outstanding
shares of stock of HII as of the date of such transaction, or in the case of a series of
transactions, the date of the last transaction of such series.

     (d) Permitted Actions. Notwithstanding Section 8.2(c), during the Restriction Period
HII may take an HII Restricted Action, if the conditions set forth in Section 8.2(d)(i), Section
8.2(d)(ii), or Section 8.2(d)(iii) are satisfied. For purposes of such provisions, in determining
whether a ruling or opinion is satisfactory, New NGC may consider, among other factors, the
appropriateness of any underlying assumptions or representations used as a basis for the ruling or
opinion and the views of New NGC’s outside tax advisors on the substantive merits of the matters
addressed in such ruling or opinion.

     (i) The conditions set forth in this Section 8.2(d)(i) shall be satisfied if HII shall
have requested New NGC to obtain a supplemental ruling in accordance with Section 8.3 to the
effect that such action or transaction will not affect the Tax-Free Status of the
Transactions, and New NGC shall have received such a supplemental ruling in form and
substance satisfactory to New NGC.

24

 

     (ii) The conditions set forth in this Section 8.2(d)(ii) shall be satisfied if HII
shall have provided to New NGC an Unqualified Tax Opinion in form and substance satisfactory
to New NGC.

     (iii) Solely with respect to the Restricted Actions described in Section 8.2(c)(i), the
conditions of this Section 8.2(d)(iii) shall be satisfied if HII notifies New NGC in writing
of the proposed dissolution, liquidation, or merger involving the relevant HII Group Member,
and New NGC consents, in writing, to such dissolution, liquidation, or merger;
provided, however, that this Section 8.2(d)(iii) shall not apply to a
dissolution or liquidation of HII or to a merger to which HII is a party.

  (e) Restrictions Relating to NGC. HII shall not, and shall not permit any HII Group
Member to, (A) sell, convey, assign or otherwise transfer any shares of capital stock of NGC, (B)
transfer any asset to NGC, or (C) take any action that could be reasonably likely to cause NGC to
engage in any business activity or otherwise to be inconsistent with the liquidation of NGC in
the Transactions for federal Income Tax purposes; provided, however, that nothing
in this Section 8.2(e) shall prevent NGC from approving the amendment to its Certificate of
Incorporation as contemplated by the Separation and Distribution Agreement, including Section 8.2
thereof.

          Section 8.3 Procedures Regarding Rulings and Opinions.

     (a) If HII notifies New NGC that it desires to undertake, or to cause an HII Group Member to
undertake, an HII Restricted Action, New NGC shall cooperate with HII and use its reasonable best
efforts to seek to obtain, as expeditiously as possible, at New NGC’s election, either a
supplemental ruling from the IRS or an Unqualified Tax Opinion for the purpose of permitting HII to
take such Restricted Action. HII shall bear its own costs and expenses and shall reimburse New NGC
for all reasonable costs and expenses incurred by the Current Tax Group in obtaining a supplemental
ruling or an Unqualified Tax Opinion requested by HII.

     (b) Notwithstanding Section 8.3(a), (i) New NGC shall have no obligation to request a
supplemental or other ruling if, upon consultation with appropriate IRS personnel, New NGC
reasonably determines that IRS could be likely not to issue such ruling, and (ii) New NGC shall
have no obligation to take any action to obtain a supplemental or other ruling or an Unqualified
Tax Opinion with respect to any HII Restricted Action, if New NGC reasonably determines that such
HII Restricted Action or the process to obtain such ruling or opinion reasonably could be expected
to have a significant adverse effect on any New NGC Group Member.

     (c) Except in accordance with Section 8.3(a), no HII Group Member shall seek any guidance from
the IRS or any other Tax Authority (whether written, verbal or otherwise) at any time concerning
the Transactions (including guidance as to the impact of any other transaction on the
Transactions).

     (d) New NGC shall have the right to obtain a ruling, determination or other guidance from any
Tax Authority (including a supplemental IRS Ruling) or an opinion, including an Unqualified Tax
Opinion, in its sole and absolute discretion and at any time. If New NGC decides to obtain such
guidance or opinion, HII shall, and shall cause the HII Group Members to,

25

 

cooperate with New NGC and take any and all actions reasonably requested by New NGC in
connection with obtaining such guidance or opinion. Such cooperation shall include the making of
any reasonable representation, warranty, undertaking or covenant, or the providing of any materials
requested by the Tax Authority or the law firm issuing such opinion; provided, that HII shall not
be required to make (or cause an Affiliate to make) any representation, warranty, undertaking or
covenant that is inconsistent with historical facts or as to future matters or events over which it
has no control. In connection with obtaining a ruling or determination from a Tax Authority, New
NGC shall apply for such ruling or determination and shall have sole and exclusive control over the
process of obtaining such ruling or determination, including the right to modify or withdraw such
request at any time. New NGC and HII each shall bear its own costs and expenses in obtaining a
ruling, determination or Tax Opinion requested by New NGC.

          Section 8.4 Indemnification.

     (a) Indemnification by HII. HII shall indemnify and hold each New NGC Group Member
harmless from and against any loss, cost or expense (including Transactions Taxes and legal,
accounting and other fees and other expenses incurred in connection with any Tax Proceeding)
resulting from (1) a failure by any HII Group Member to comply with any covenant, agreement,
undertaking, representation or warranty made by HII in Section 8.1 or Section 8.2; or (2) the
taking of any HII Restricted Action during the Restriction Period (whether or not HII shall have
received a ruling or Unqualified Tax Opinion pursuant to Section 8.2(d) and Section 8.3).

     (b) Indemnification by New NGC. New NGC shall indemnify and hold each HII Group
Member harmless from and against any loss, cost or expense (including Transactions Taxes and legal,
accounting and other fees and other expenses incurred in connection with any Tax Proceeding)
resulting from a failure by any New NGC Group Member to comply with any covenant, agreement,
undertaking, representation or warranty made by New NGC in Section 8.1 or Section 8.2.

     (c) Interaction with ARTICLE 6. Transaction Taxes shall be determined without
reference to the methodology or limitations set forth in ARTICLE 6.

ARTICLE 9

COOPERATION

          Section 9.1 General Cooperation.

     The Parties each shall cooperate fully (and each shall cause its respective Subsidiaries to
cooperate fully) with all reasonable requests in writing from another Party hereto, or from an
agent, representative or advisor to such Party, in connection with the preparation and filing of
Tax Returns, claims for Refunds, Tax Proceedings and calculations of amounts required to be paid
pursuant to this Agreement, in each case, related or attributable to or arising in connection with
Taxes of any of the Parties or their respective Subsidiaries covered by this Agreement and the
establishment of any reserve required in connection with any financial reporting. The Parties
shall continue to cooperate with each other with respect to such matters without regard to the time
limitation set forth in Section 7.7(d) of the Separation and Distribution Agreement. Except

26

 

as
provided in Section 7.3 of the Separation and Distribution Agreement, each Party shall make
its employees, advisors and facilities available, without charge, on a reasonable and mutually
convenient basis in connection with the foregoing matters, and the cooperation required by this
Section 9.1 shall include the providing of any information reasonably necessary or helpful in
connection with such matters and shall include, without limitation, at each Party’s own cost and
expense:

     (a) the providing of Tax Returns of the Parties and their respective Subsidiaries, books,
records (including information regarding ownership and Tax basis of property), documentation and
other information relating to such Tax Returns, including accompanying schedules, related work
papers, and documents relating to rulings or other determinations by Tax Authorities;

     (b) the execution of documents (including powers of attorney) in connection with any Tax
Proceedings of any of the Parties or their respective Subsidiaries, or the filing of Tax Returns or
a Refund claims of the Parties or their respective Subsidiaries;

     (c) the use of the Party’s reasonable best efforts to obtain any documentation in connection
with a Tax Matter; and

     (d) the use of the Party’s reasonable best efforts to obtain any Tax Returns (including
accompanying schedules, related work papers, and documents), documents, books, records or other
information in connection with the filing of any Tax Returns of any of the Parties or their
Subsidiaries.

          Section 9.2 Retention of Records.

     In
addition to complying with their respective obligations as set forth in Article VII of the
Separation and Distribution Agreement, (a) each of the Parties shall retain or cause to be retained
all Tax Returns, schedules and workpapers, and all material records or other documents relating
thereto in their possession, until sixty (60) days after the expiration of the applicable statute
of limitations (including any waivers or extensions thereof) of the taxable periods to which such
Tax Returns and other documents relate or until the expiration of any additional period that any
Party reasonably requests, in writing, with respect to specific material records or documents; (b)
a Party intending to destroy any material records or documents shall provide the other Party with
reasonable advance notice and the opportunity to copy or take possession of such records and
documents; and (c) each of the Parties shall notify the other Party in writing of any waivers or
extensions of the applicable statute of limitations that may affect the period for which the
foregoing records or other documents must be retained.

          Section 9.3 Confidentiality.

     Section 7.8
and Section 7.9 of the Separation and Distribution Agreement shall apply to all
Information provided by the Parties to each other pursuant to this Agreement. Provided,
however, that, if the Party receiving any such Information reasonably determines that any such
Information will be helpful in the resolution of a Tax Proceeding if disclosed to a Tax Authority,
then, upon request of such Party, the Party providing such Information shall promptly permit

27

 

such disclosure unless such Party reasonably determines that such disclosure is likely to have
a material adverse effect on such Party or any of its Affiliates.

ARTICLE 10

MISCELLANEOUS

          Section 10.1 Timing of Payments; Interest.

     Amounts payable pursuant to this Agreement shall be paid within 30 days of the written demand
by the Party entitled to receive such payments. Such demand shall include documentation setting
forth the basis for the amount payable. Any payment not made within 30 days of the written demand
for such payment shall accrue interest at a rate per annum equal to the rate in effect for
underpayments pursuant to Section 6621(a)(2) of the Code (without taking into account increased
rates under Section 6621(c)) from such date, compounded annually.

          Section 10.2 Dispute Resolution.

     (a) Negotiations. The Parties shall endeavor, and shall cause their respective
Affiliates to endeavor, to resolve any Tax Sharing Dispute in an amicable manner through
negotiations in good faith for not less than 45 days involving senior executives of the Parties who
have authority resolve the matter.

     (b) Appointment of Tax Arbitrator by the Parties. Upon written notice by either Party
to the other Party after such 45-day period, the Parties shall jointly choose, retain and appoint
one individual to resolve the Tax Sharing Dispute (the “Tax Arbitrator”). The Tax
Arbitrator shall be a nationally-recognized tax attorney and shall be either a current or retired
member of an Independent Firm or a former or retired judge or government official. In choosing a
Tax Arbitrator, the Parties may consider, among other matters, the professional expertise of each
prospective Tax Arbitrator, such individual’s independence from the Parties, the cost of retaining
such individual and such individual’s availability to perform the services of Tax Arbitrator on a
timely basis. Neither of the Parties will unreasonably withhold or delay giving consent to the
appointment of any qualified individual as Tax Arbitrator.

     (c) Appointment of Tax Arbitrator by Individuals Designated by the Parties. If,
having determined that the Tax Sharing Dispute must be referred to a Tax Arbitrator, the Parties
cannot, after 45 days, retain a Tax Arbitrator who is acceptable to both Parties in good faith,
then, upon written notice of either Party to the other Party, each Party shall designate and retain
at its own expense an individual who shall have the qualifications described in Section 10.2(b).
Such individuals shall agree upon and appoint as Tax Arbitrator an individual (not either of such
individuals or any member of a firm of which either of such individuals is a member or a retired
member) who shall have such qualifications and who shall have agreed to serve as Tax Arbitrator at
a cost no greater than the normal and customary charges imposed by such individual (or the
Independent Firm of which he or she is a member or a retied member) for tax services. The
appointment of the Tax Arbitrator by such individuals shall be final and binding on the Parties,
except if they agree otherwise.

28

 

     (d) Proceedings Before Tax Arbitrator. The Tax Arbitrator shall decide all points
relating to the Tax Sharing Dispute. Except to the extent jointly determined by agreement of both
Parties, the Tax Arbitrator shall conduct proceedings necessary to reach a decision, as he or she
reasonably determines, and may, in his or her reasonable discretion, obtain the services of any
individual (including other members or employees of an Independent Firm of which the Tax Arbitrator
is a current or retired member) to assist in deciding the Tax Sharing Dispute. All fees and
expenses of the Tax Arbitrator shall be shared equally by New NGC and HII.

     (e) Tax Arbitrator’s Written Decision. As soon as practicable after proceedings are
complete, the Tax Arbitrator shall furnish a written decision to the Parties. Such decision shall
set forth the decision of the Tax Sharing Dispute but shall not include any rationale therefor,
discussion thereof or citations of legal authority, except to the extent necessary to make the
terms of the decision clear to the Parties. The decision of the Tax Arbitrator shall be final and
binding on the Parties, and the Parties shall take, or cause to be taken, any action necessary to
implement the decision.

          Section 10.3 Survival of Covenants.

     Except as otherwise contemplated by this Agreement, all covenants and agreements of the
Parties contained in this Agreement shall survive the Distribution and remain in full force and
effect in accordance with their applicable terms, provided, however, that the
representations and warranties and all indemnification for Taxes shall survive until 60 days
following the expiration of the applicable limitations period (taking into account all extensions
thereof), if any, for the Tax that gave rise to the indemnification, provided,
further, that, in the event that notice for indemnification has been given within the
applicable survival period, such indemnification shall survive until such time as such claim is
finally resolved.

          Section 10.4 Termination of Agreements, Arrangements and Policies.

     Except for this Agreement and except as otherwise provided herein, all tax allocation
agreements, arrangements or policies in effect between or among NGC Members shall be terminated
effective as of the Distribution Date, and thereafter no party (or any of its directors or
officers) shall have any liability or further obligation to any other party with respect to any
such agreement, arrangement or policy.

          Section 10.5 Severability.

     If any term or other provision of this Agreement is invalid, illegal or incapable of being
enforced pursuant to any Law or as a matter of public policy, all other conditions and provisions
of this Agreement shall remain in full force and effect. Upon such determination that any term or
other provision is invalid, illegal or incapable of being enforced, the Parties to this Agreement
shall negotiate in good faith to modify this Agreement so as to effect the original intent of the
Parties as closely as possible in a mutually acceptable manner.

          Section 10.6 Entire Agreement.

     Except as otherwise expressly provided in this Agreement, this Agreement constitutes the
entire agreement of the Parties hereto with respect to the subject matter of this Agreement and

29

 

supersedes all prior agreements and undertakings, both written and oral, between or on behalf
of the Parties hereto with respect to the subject matter of this Agreement.

          Section 10.7 Assignment.

     This Agreement shall not be assigned by any Party without the prior written consent of the
other Party hereto, except that New NGC and HII each may assign (i) any or all of its rights and
obligations pursuant to this Agreement to another New NGC Group Member or HII Group Member, as the
case may be, and (ii) any or all of its rights and obligations pursuant to this Agreement in
connection with a sale or disposition of any assets or entities or lines of business;
provided, however, that no such assignment shall release the assigning Party from
any liability or obligation pursuant to this Agreement.

          Section 10.8 No Third-Party Beneficiaries.

     This Agreement is for the sole benefit of the Parties, their respective Subsidiaries and the
permitted successors and assigns. Nothing in this Agreement, express or implied, is intended to or
shall confer upon any other Person any legal or equitable right, benefit or remedy of any nature
whatsoever pursuant to or by reason of this Agreement.

          Section 10.9 Specific Performance.

     In the event of any actual or threatened default in, or breach of, any of the terms,
conditions and provisions of this Agreement, the Party who is or is to be thereby aggrieved shall
have the right to specific performance and injunctive or other equitable relief of its rights
pursuant to this Agreement, in its sole discretion, in addition to any and all other rights and
remedies at law or in equity, and all such rights and remedies shall be cumulative. The Parties
agree that the remedies at law for any breach or threatened breach, including monetary damages, may
be inadequate compensation for any loss and that any defense in any action for specific performance
that a remedy at law would be adequate is waived. Any requirements for the securing or posting of
any bond with such remedy are waived by the Parties to this Agreement.

          Section 10.10 Amendment.

     No provision of this Agreement may be amended or modified except by a written instrument
signed by the Parties to this Agreement. No waiver by any Party of any provision of this Agreement
shall be effective unless explicitly set forth in writing and executed by the Party so waiving. The
waiver by any Party of a breach of any provision of this Agreement shall not operate or be
construed as a waiver of any other subsequent breach.

          Section 10.11 Rules of Construction.

     Interpretation of this Agreement shall be governed by the following rules of construction: (i)
words in the singular shall be held to include the plural and vice versa; (ii) words of one gender
shall be held to include the other gender as the context requires; (iii) references to the terms
Article, Section, paragraph, or clause, are references to the Articles, Sections, paragraphs, or
clauses of this Agreement unless otherwise specified; (iv) the terms “hereof,” “herein,” “hereby,”
“hereto,” and derivative or similar words refer to this entire Agreement; (v) the word

30

 

“including” and words of similar import shall mean “including without limitation,” unless
otherwise specified; (vi) references to “written” or “in writing” include in electronic form; (vii)
the table of contents and headings contained in this Agreement are for reference purposes only and
shall not affect in any way the meaning or interpretation of this Agreement; (viii) a reference to
any Person includes such Person’s successors and permitted assigns; (ix) a reference to a provision
of the Code, Treasury Regulations or any other Law mean the provision, or the successor provision
thereto, as in effect for the relevant period in question; and (x) a reference to a Party’s taking
an action shall include the Party’s failure to take an action having the same result as the action
referred to.

          Section 10.12 Notices.

     All notices, notifications, requests, and other communications hereunder shall be in writing
and shall be deemed duly given (a) on the date of delivery if delivered personally, or if by
facsimile, upon written confirmation of receipt by facsimile, e-mail or otherwise, (b) on the first
Business Day following the date of dispatch if delivered utilizing a next-day service by a
recognized next-day courier or (c) on the earlier of confirmed receipt or the fifth Business Day
following the date of mailing if delivered by registered or certified mail, return receipt
requested, postage prepaid. All such notices, notifications, requests, and other communications
shall be delivered to the addresses set forth below, or pursuant to such other instructions as may
be designated in writing by the party to receive such communication:

	 	 	 	 	 	 	 

	(a)	 	if to New NGC or any New NGC Group Member, to:	 	 
	 
	 	 	 	 	 	 
	 	 	Northrop Grumman Corporation	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Attention:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Facsimile:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	with a copy (which shall not constitute notice) to:	 	 
	 
	 	 	 	 	 	 
	 	 	Northrop Grumman Corporation	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 	 	Attention: General Counsel	 	 
	 

	 	Facsimile:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	(b)	 	if to HII or any HII Group Member, to:	 	 
	 
	 	 	 	 	 	 
	 	 	Huntington Ingalls Industries, Inc.	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Attention:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Facsimile:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	with a copy (which shall not constitute notice) to:	 	 

31

 

	 	 	 	 	 	 	 

	 	 	Huntington Ingalls Industries, Inc.	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 	 	Attention: General Counsel	 	 
	 

	 	Facsimile:	 	 	 	 
	 

	 	 	 	 	 	 

          Section 10.13 Counterparts.

     This Agreement may be executed in one or more counterparts each of which when executed shall
be deemed to be an original but all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this Agreement by facsimile
or portable document format (PDF) shall be as effective as delivery of a manually executed
counterpart of any such Agreement.

          Section 10.14 Coordination with the Employee Matters Agreement.

     To the extent any covenants or agreements between the Parties with respect to employment Taxes
are set forth in the Employee Matters Agreement, such matters shall be governed exclusively by the
Employee Matters Agreement and not by this Agreement.

          Section 10.15 Conflict or Inconsistency Between Agreements.

     In the event of any conflict or inconsistency between any provision of this Agreement and any
provision of either the Separation and Distribution Agreement or any of the other Ancillary
Agreements, the applicable provision of this Agreement shall prevail.

          Section 10.16 Termination of this Agreement.

     This Agreement may be terminated by NGC at any time prior to the effectiveness of the Holding
Company Reorganization or by New NGC at any time at or after the effectiveness of the Holding
Company Reorganization and prior to the Distribution. In the event of termination of this
Agreement prior to the Distribution, no party (or any of its directors or officers) shall have any
Liability or further obligation to any other party with respect to this Agreement.

[The remainder of this page is intentionally left blank.]

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     IN WITNESS WHEREOF, the Parties have caused this Tax Matters Agreement to be duly executed by
their duly authorized representatives as of the day and year first above written.

	 	 	 	 	 
	 	NEW P, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	HUNTINGTON INGALLS INDUSTRIES, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

[Signature Page to Tax Matters Agreement]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00183-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00183-of-00352.parquet"}]]