Document:

Exhibit 10.1

 

TRANSITION SERVICES AGREEMENT

 

This TRANSITION SERVICES AGREEMENT (this “Agreement”) is made this [·] day of [·], 2015, by and between SPX Corporation, a Delaware corporation (“SPX”) and SPX FLOW, Inc., a Delaware corporation (“Flowco”).  Capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed to them in the Separation Agreement (as defined below).

 

W I T N E S S E T H:

 

WHEREAS, SPX and Flowco are parties to that certain Separation and Distribution Agreement dated as of [·], 2015 (the “Separation Agreement”);

 

WHEREAS, in furtherance of the transactions contemplated in the Separation Agreement, SPX has agreed to provide to Flowco certain services for the periods and on the terms and conditions set forth herein; and

 

WHEREAS, in furtherance of the transactions contemplated in the Separation Agreement, Flowco has agreed to provide to SPX certain services for the periods and on the terms and conditions set forth herein.

 

NOW, THEREFORE, in consideration of the mutual agreements and covenants set forth herein and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, and intending to be legally bound hereby, the parties agree:

 

1.             SERVICES

 

1.1          Services.  During the term of this Agreement and subject to the terms and conditions set forth herein,

 

(a)           SPX shall provide to Flowco, or cause an Affiliate or Affiliates of SPX designated by SPX for this purpose to provide to Flowco (with SPX, each, a “SPX Service Provider”), and Flowco agrees to purchase from the SPX Service Providers, the services set forth in Schedule A attached hereto (each, an “SPX Service”, and collectively, the “SPX Services”); and

 

(b)           Flowco shall provide to SPX, or cause an Affiliate or Affiliates of Flowco designated by Flowco for this purpose to provide to SPX (with Flowco, each, a “Flowco Service Provider” and together with the SPX Service Providers, the “Service Provider”), and SPX agrees to purchase from the Flowco Service Providers, the services set forth in Schedule B attached hereto (each, a  “Flowco Service”, collectively, the “Flowco Services” and together with the SPX Services, the “Services”).

 

1.2          Level of Services.  Except as set forth specifically in Schedule A, Schedule B or otherwise specifically agreed to in writing by SPX and Flowco, (a) each party shall provide, or cause its Affiliate to provide, each Service with a degree of care consistent with the care it exercises in the conduct of similar activities for itself, (b) each of the SPX Services that are similar to those provided to, or in connection with the operation of, the Flowco Business prior to the Effective Time shall be, in all material respects, consistent in scope, quality and nature with

 

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those provided to, or provided on behalf of, the Flowco Business prior to the date hereof, (c) each of the Flowco Services that are similar to those provided to, or in connection with the operation of, the Infrastructurco Business prior to the Effective Time shall be, in all material respects, consistent in scope, quality and nature with those provided to, or provided on behalf of, the Infrastructurco Business prior to the date hereof and (d) in no event shall any Service be provided at a level of service (including, without limitation, accuracy, quality, completeness, timeliness, priority and responsiveness) lower than the levels at which such Services were provided prior to the date hereof, if applicable.  The Services to be provided hereunder that are not similar to those provided to the Flowco Business or to the Infrastructurco Business prior to the Effective Time shall be performed by personnel selected by the Service Provider providing such Services, which personnel shall have the capacity, skill and expertise necessary to perform such Services.  In providing the Services, neither the Service Provider nor any of its Affiliates shall be obligated to: (i) hire any additional employees; (ii) maintain the employment of any specific employee; or (iii) purchase, lease or license any additional facilities, equipment or materials; provided that, at all times, the Service Provider shall maintain the standard of care and performance as set forth in the preceding sentences of this Section 1.2.

 

1.3          Cooperation.  Each party shall cause its employees to reasonably cooperate with employees of the Service Provider in providing a Service to such party, to the extent required for effective delivery of the Services and to minimize the disruption to, or additional recordkeeping required by, the Service Provider.  In addition, each party shall name a point of contact who shall be responsible for the day-to-day implementation of this Agreement, including attempted resolution of any issues that may arise during the performance of any of such party’s obligations hereunder.

 

1.4          Third-Party Services.  At its option, each party may cause any Service it is required to provide hereunder to be provided by any third party (a “Third-Party Service”), in which event such Service Provider shall provide prior written notice to the other party of its election to cause such Service to be provided by a third party.  Such Service Provider shall not be responsible for the performance of any Third-Party Services so long as such Service Provider reasonably selects the provider of such Third-Party Services and imposes on such third-party provider the confidentiality obligations specified in this Agreement.  The Service Provider shall assign its rights to enforce any confidentiality claims against such third-party provider to the other party.

 

1.5          Impracticability.  Notwithstanding any other provision of this Agreement, no Service Provider shall be required to provide any Service to the extent the performance of such Service becomes impracticable as a result of a cause or causes outside the control of such Service Provider or to the extent the provision of such Service would require such Service Provider to violate any applicable laws. Each party, as Service Provider, shall promptly notify the other party in writing upon learning of such a cause or causes and shall use commercially reasonable efforts to resume its performance of any Service so suspended with the least possible delay as soon as practicable.

 

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1.6          Performance and Receipt of Services.

 

(a)           SPX and Flowco shall each exercise reasonable care in providing and receiving any Service to (i) prevent access to the Services or the computing, telecommunications or other digital operating or processing systems or environments (including computer programs, data, databases, computers, computer libraries, communications equipment, networks and systems) accessed and/or used in connection with the Services (collectively, the “Information Systems”) by unauthorized Persons and (ii) not damage, disrupt or interrupt the Services or Information Systems.

 

(b)           Neither SPX nor Flowco shall access, nor shall either permit unauthorized Persons to access, the other party’s Information Systems and/or networks without express written authorization of such party, and any such actual or attempted access shall be consistent with any such authorization and the means of access directed by the party granting access to the given Information System.  Each party shall comply with those reasonable policies and procedures relating to access to the other party’s Information Systems as have been provided to it by the other party.

 

1.7          Representatives; Status Meetings.  SPX hereby designates [·] as the SPX representative (the “SPX Representative”) and Flowco hereby designates [·] as the Flowco representative (the “Flowco Representative”) to coordinate the Services provided under this Agreement.  The SPX Representative and the Flowco Representative shall meet on a monthly basis, or more frequently if reasonably requested by either party, to discuss the Services being provided, the charges and Invoices (as defined below) therefor, any problems with the Services, charges or Invoices, any proposed modifications and any terminations of Services pursuant to Section 6.2(b) below (“Status Meetings”).  Status Meetings shall be held at a time and place mutually agreeable to the Flowco Representative and the SPX Representative and shall be for a reasonable duration; provided that Status Meetings may be held in person or via conference telephone, videophone or similar means.  Each of SPX and Flowco may change its respective representative at any time by written notice to the other party.

 

1.8          Personnel. Each Service Provider shall remain responsible for compensating the employees and the independent contractors it engages to perform the Services on its behalf.  The parties acknowledge and agree that those employees and independent contractors used by the Service Providers in the performance of the Services will have no employer/employee relationship with the recipient of the Services, and that each Service Provider alone is responsible for providing workers’ compensation insurance for its applicable employees, for paying the salaries and wages of its applicable employees, for providing any employee benefits to its applicable employees, and for ensuring that all required tax withholdings are made.

 

2.             PAYMENTS

 

2.1          Services Pricing.  Flowco shall pay SPX or its applicable Affiliate fees for the SPX Services on the basis and in the manner described in Schedule A.  SPX shall pay Flowco or its applicable Affiliate fees for the Flowco Services on the basis and in the manner described in Schedule B.  Each party or its agents shall keep and maintain such books and records as may be reasonably necessary to make any applicable allocations.  During the term of this Agreement and

 

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at any time thereafter upon the reasonable request of another party, each party shall make copies of the relevant portion of such books and records available to the other party for inspection upon request and with reasonable notice.

 

2.2          Invoicing. Except for those charges with alternate invoicing and payment terms specifically set forth in the Schedules hereto, within twenty (20) days following the end of each calendar month during the term hereof, (a) SPX shall provide to Flowco a single invoice in form, format and media reasonably acceptable to Flowco totaling all charges during such month for SPX Services incurred by Flowco hereunder (each, a “SPX Invoice”) and (b) Flowco shall provide to SPX a single invoice in form, format and media reasonably acceptable to SPX totaling all charges during such month for Flowco Services incurred by SPX hereunder (each, a “Flowco Invoice” and with any SPX Invoice, each an “Invoice”).  Any failure by a party to provide an Invoice within such time period or to provide the Invoice in such form, format or media as is reasonably acceptable to the recipient of the Invoice shall not relieve the recipient of the Invoice of its obligation to pay any Invoice received after such date.  Each party agrees to provide such information as reasonably requested by the other party for use in preparation of an Invoice.  Each Invoice shall contain a brief description of each Service giving rise to such charge.

 

2.3          Payment.  Each party shall pay all amounts due under each Invoice no later than forty-five (45) days following receipt of such Invoice, without right to set-off or counterclaim (the “Payment Date”).  Each party reserves the right to require payment in advance for any out-of-pocket expenses that may be incurred in the course of performing this Agreement, including, without limitation, payroll expenses.  In addition, the recipient shall be responsible for any fees or charges payable to any government, regulatory organization or other body in connection with the Services, and any sales, use, value added, property, duties, or other taxes arising under this Agreement including in connection with payments due under any Invoice (but excluding any taxes on the net income of the Service Provider) and shall remit the amount due under this Agreement without offset for any withholdings, fees or charges in respect of any payments under this Agreement.  Each party shall pay all amounts due with respect to those charges with alternate invoicing and payment terms specifically set forth in the Schedules hereto in accordance with the relevant payment terms set forth in the Schedules.

 

2.4          Late Payments. Interest on late payments will accrue at the Prime Rate plus 2% (or the maximum legal rate, whichever is lower) calculated for the actual number of days elapsed, accrued from the applicable Payment Date up to the date of the actual receipt of payment.

 

3.             REPRESENTATIONS AND WARRANTIES

 

In addition to any representations set forth elsewhere in this Agreement (including the Schedules hereto) each party represents and warrants that:

 

3.1          Such party (including, as applicable, its Affiliates) has all necessary rights and authority to provide the Services such party will perform as a Service Provider as contemplated herein.  Each party (including, as applicable, its Affiliates) has obtained all necessary third party and governmental consents and authorizations to provide the Services such party will perform as a Service Provider as contemplated herein.

 

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3.2          Such party is not in breach of any arrangement or agreement with any third party in respect of a Service to be provided by such party that may be provided by a third party pursuant to Section 1.4.

 

4.                                      CONFIDENTIALITY

 

4.1          Information Exchanges.  Subject to applicable Law and good faith claims of privilege, each party hereto shall provide the other party with all information regarding itself and the transactions under this Agreement that the other party reasonably believes that it requires (a) in order to comply with all applicable laws, ordinances, regulations and codes in connection with the provision of Services pursuant to this Agreement or (b) to perform its obligations under this Agreement.   In addition to the foregoing information, each party shall, and shall cause its Affiliates to, afford the other party, upon reasonable advance notice, reasonable access during normal business hours to the facilities, Information, systems, infrastructure and personnel of such party and its Affiliates as reasonably necessary for the applicable recipient of Services to verify the adequacy of internal controls over information technology, reporting of financial data and related processes employed in connection with the Services being provided by any Service Provider, including in connection with verifying compliance with Section 404 of the Sarbanes-Oxley Act of 2002; provided that (i) such access shall not unreasonably interfere with any of the business or operations of the Service Provider or any of their respective Affiliates and (ii) in the event that the Service Provider determines that providing such access could be commercially detrimental, violate any Law or agreement, or waive any attorney-client privilege, then the parties shall use commercially reasonable efforts to permit such access in a manner that avoids any such harm or consequence.

 

4.2          Confidential Information.  SPX and Flowco shall, and each shall cause its Affiliates, officers, directors, employees, agents, representatives and advisors to, (a) hold in trust and maintain confidential all Confidential Information relating to the other party and (b) limit the use and disclosure of the Confidential Information solely to the purposes of such party’s obligations, benefits or rights under this Agreement; provided, however, that a party may disclose such Confidential Information that such party reasonably believes it is required to disclose by applicable Law, provided that (unless prohibited by applicable Law) it first notifies the other party hereto of such requirement and allows such party a reasonable opportunity to seek a protective order or other appropriate remedy to prevent or minimize such disclosure.  For the purposes of this Agreement, “Confidential Information” shall mean all information regarding SPX or Flowco, as applicable, of a confidential or proprietary nature, whether oral, visual, in writing or in any other tangible form, and includes, without limitation, economic, scientific, technical, product and business data, business plans, and the like, except to the extent that such information can be shown to have been (i) in the public domain through no action of the applicable receiving party or its Affiliates or any of their respective representatives or advisors, (ii) lawfully acquired from other sources by such receiving party or its Affiliates or any of their respective representatives or advisors to which it was furnished or (iii) independently developed by such receiving party or its Affiliates without use or reference to Confidential Information of the disclosing party’s or its Affiliates; provided, however, in the case of clause (ii) that, to the receiving party’s knowledge, such sources did not provide such information in breach of any confidentiality or fiduciary obligations.  Without prejudice to the rights and remedies of either party to this Agreement, a party disclosing any Confidential Information to the other party in accordance with the

 

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provisions of this Agreement shall be entitled to seek equitable relief by way of an injunction if the other party hereto breaches or threatens to breach any provision of this Section 4.2.  Upon the earlier of a request by a disclosing party or the termination of this Agreement in accordance with Section 6, each party shall promptly return or destroy all Confidential Information of the other party and copies thereof.  Upon request by the disclosing party, an authorized representative of the other party shall confirm in writing compliance with its obligation set forth in the immediately preceding sentence.

 

5.             REMEDIES; INDEMNIFICATION; LIMITATION OF LIABILITY

 

5.1          Remedies; No Warranties.  SPX and Flowco expressly agree that neither party, nor any of their respective Affiliates (nor any of the officers, directors, stockholders, employees or agents thereof) shall be liable to the other party or any of the Affiliates thereof for any claims, damages, liabilities, losses, costs or expenses (collectively, “Damages”) whatsoever relating to the Services provided by such party pursuant to this Agreement (whether as a result of any action or any failure to act), except for those Damages arising directly from such providing party’s willful misconduct or gross negligence, and, in the case of such willful misconduct or gross negligence, the remedy of the aggrieved party shall be any one or more of the following, at the aggrieved party’s election: to (a) have such Service re-performed as soon as practical without additional charge, and/or (b) terminate this Agreement as to the applicable Service as provided in Section 6.2(b), and in each case, subject to the provisions of Section 5.3.  The parties expressly agree that (i) no warranty of any kind (including any warranties of utility or fitness for any particular purpose or of merchantability or of any other type) shall be implied under this Agreement and that no warranties of any kind are made herein, (ii) except for Services specifically designated as advisory services in the Schedules hereto, it is not the intent of either party to render (in its capacity as Service Provider) nor to receive (in its capacity as recipient of Services) any professional advice or opinions, whether with regard to tax, legal, treasury, finance, employment or other business and financial matters, or technical advice, whether with regard to information technology or other matters, and neither party shall rely on, or construe, any Service rendered by or on behalf of the applicable Service Provider as such professional advice or opinions or technical advice; and (iii) each party shall seek all third-party professional advice and opinions or technical advice as it may desire or need.

 

5.2          Indemnification.

 

(a)           Flowco shall indemnify SPX and its Affiliates and the officers, directors, employees and agents of each (collectively, the “SPX Parties”), and hold each SPX Party harmless against any Damages incurred or suffered by any SPX Party in any way arising out of, relating to, or in connection with any third-party claims based on the performance of SPX Services hereunder (whether by a SPX Service Provider or by a third party as a Third-Party Service), except in the case of third party claims arising directly from SPX’s fraud, willful misconduct or gross negligence.  This Section 5.2(a) shall survive any termination of this Agreement.

 

(b)           SPX shall indemnify Flowco and its Affiliates and the officers, directors, employees and agents of each (collectively, the “Flowco Parties”), and hold each Flowco Party harmless against any Damages incurred or suffered by any Flowco Party in any way arising out of, relating to, or in connection with any third-party claims based on the performance of Flowco Services hereunder (whether by a Flowco Service Provider or by a third party as a Third-Party

 

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Service), except in the case of third-party claims arising directly from Flowco’s willful misconduct or gross negligence.  This Section 5.2(b) shall survive any termination of this Agreement.

 

(c)           The procedures contained in the indemnification and related litigation cooperation provisions of the Separation Agreement shall apply with respect to each Party’s indemnification obligations under this Section 5.2.  The right to indemnification and the remedies set forth in this Section 5 shall constitute the parties’ sole and exclusive remedies with respect to any and all claims arising under or relating to this Agreement or the Services provided hereunder.

 

5.3          Limitation of Liability.  Notwithstanding any other provision in this Agreement to the contrary, (a) other than as may be included in actual payments of Damages to third parties arising from claims subject to indemnification under Section 5.2, no party shall have any liability to the other party relating to this Agreement for damage to reputation, lost business opportunities, lost profits, mental or emotional distress, incidental, special, exemplary, punitive or indirect damages, interference with business operations or diminution in value and (b) other than claims for breaches of Section 4 and actual payments of Damages to third parties arising from claims subject to indemnification under Section 5.2, in no event shall the aggregate liability of a party to the aggrieved party for (i) Damages and (ii) costs of re-performance of a Service, relating to this Agreement (under any theory, whether in contract, tort, statutory or otherwise) exceed the aggregate amounts actually paid by the aggrieved party for Services received under this Agreement (exclusive of any amounts such aggrieved party has paid as reimbursement for pass-through expenses).

 

6.             TERM AND TERMINATION

 

6.1          Term.  Unless earlier terminated in accordance with Section 6.2 below, this Agreement shall be in effect from the Effective Time until the twelve (12) month anniversary of such date.  Except as specifically set forth on Schedule A or Schedule B, upon termination of any Service pursuant to Section 6.2 below, or upon any termination of this Agreement in accordance with its terms, the applicable Service Provider shall have no further obligation to provide the terminated Service (or any Service, in the case of termination of this Agreement) and the recipient of such terminated Service shall have no obligation to pay any fees relating to such terminated Service or Services (or to make any other payments hereunder, in the case of termination of this Agreement); provided that, notwithstanding such termination, the recipient shall remain liable to the Service Provider for fees owed and payable in respect of Services provided prior to the effective date of the termination.

 

6.2                               Termination.

 

(a)           If a party (the “Defaulting Party”) has materially breached its obligations under this Agreement and has not cured such default within thirty (30) days following the date on which the other party (the “Notifying Party”) has given written notice to the Defaulting Party specifying the facts constituting the default, the Notifying Party may, in its sole discretion, (i) suspend or terminate (or any combination thereof) providing or receiving any or all of the Services, in whole or in part, or (ii) terminate this Agreement.  Notwithstanding the foregoing sentence, neither this Agreement nor any Service shall be terminated due to a default by the

 

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Defaulting Party if such default is directly attributable to a breach of this Agreement by the Notifying Party.

 

(b)           Except as otherwise set forth in Schedule A or as provided in this Section, Flowco shall be permitted to terminate this Agreement with respect to any particular or all SPX Services to be provided by a SPX Service Provider upon thirty (30) days prior written notice to SPX (with a copy to SPX Representative) notifying SPX of the specific SPX Services that are no longer required.  Except as otherwise set forth in Schedule B or as provided in this Section, SPX shall be permitted to terminate this Agreement with respect to any particular or all Flowco Services to be provided by a Flowco Service Provider upon thirty (30) days prior written notice to Flowco notifying Flowco (with a copy to Flowco Representative) of the specific Flowco Services that are no longer required.  Notwithstanding the foregoing, for any Service that is provided in whole or in part by a third party and the Service Provider’s agreement or arrangement with such third party relating to such Service cannot be terminated upon fifteen (15) days’ prior written notice, this Agreement with respect to such Service shall not be deemed to have been terminated with respect to such Service until the earliest date by which such Service Provider’s agreement or arrangement with such third party may be terminated without payment or penalty.  SPX or Flowco, as applicable, will incrementally decrease the subsequent Invoices by the applicable amount or amounts of the relevant fees for any Services terminated by the other party hereunder.

 

(c)           SPX may suspend or terminate any or all the SPX Services hereunder effective upon not less than ten (10) days’ prior written notice from SPX to Flowco if Flowco has failed to pay any SPX Invoice or other amounts owing to SPX for SPX Services when due (as provided in Section 2.2) more than ten (10) days after SPX has given Flowco written notice of such past due amount.  Flowco may suspend or terminate any or all the Flowco Services hereunder effective upon not less than ten (10) days’ prior written notice from Flowco to SPX if SPX has failed to pay any Flowco Invoice or other amounts owing to Flowco for Flowco Services when due (as provided in Section 2.2) more than ten (10) days after Flowco has given SPX written notice of such past due amount.

 

(d)           Upon termination of this Agreement for any reason, all rights and obligations of the parties under this Agreement shall cease and be of no further force or effect, except that the provisions of Sections 2.3, 4, 5 and 7 of this Agreement shall survive any such termination or expiration.

 

(e)           Upon the end of the term or the earlier termination of this Agreement, each Service Provider shall, as promptly as practicable thereafter, deliver to the other party all books and records, or copies thereof, that pertain solely to such other party’s businesses that are used or generated in the course of the provision of Services hereunder.

 

7.             GENERAL

 

7.1          Successors and Assigns.  The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties hereto.  Neither party may assign this Agreement or any of such party’s rights hereunder without the prior written consent of the other party; provided, however, that each party may assign, in its sole discretion, any or all of its rights, interests and obligations under this Agreement to one or more of its direct or indirect wholly owned Subsidiaries so long as such assignment does not have any

 

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adverse consequences to the other party or its Affiliates.  No assignment shall relieve the assigning party from any of its obligations under this Agreement and in the event of an assignment, the assigning party shall nonetheless continue to be primarily liable for all of its obligations hereunder.  Each assignee shall execute a counterpart of this Agreement agreeing to be bound by the provisions hereof.

 

7.2          Force Majeure.  No party shall bear any responsibility or liability for any damages arising out of any delay, inability to perform or interruption of its performance of its obligations under this Agreement due to any acts or omissions of the other party hereto or for events beyond its reasonable control including, without limitation, acts of God, acts of governmental authorities, acts of the public enemy or due to war, riot, flood, civil commotion, insurrection, labor difficulty, severe or adverse weather conditions, lack of or shortage of electrical power, malfunctions of equipment or software programs, or any other cause beyond the reasonable control of such party. Each party shall, as promptly as practicable, notify the other upon learning of the occurrence of such event of force majeure affecting its ability to perform its obligations hereunder.  Upon the cessation of a force majeure event, the party whose performance was suspended shall use commercially reasonable best efforts to resume its performance.

 

7.3          Relationship of the Parties.  The parties shall for all purposes be considered independent contractors with respect to each other, and neither shall be considered an employee, employer, agent, principal, partner or joint venturer of the other.

 

7.4          Intellectual Property.  Nothing in this Agreement shall be interpreted to, or shall, assign, transfer or license any intellectual property rights between the parties hereto, and each party shall retain all right, title and interest in and to their respective intellectual property rights and any and all improvements, modifications and derivative works thereof or thereto.

 

7.5          Compliance with Laws.  Each party acknowledges and agrees that the Services shall be provided only with respect to the Flowco Business or to the Infrastructurco Business, as applicable, as such business was operated immediately prior to the Closing Date or as mutually agreed by the parties hereto.  Each party covenants and agrees that it shall use the Services only in accordance with all applicable laws, and in accordance with past practices.  Each party, as a Service Provider, reserves the right to take all actions, including suspension or termination of any particular Service, that such Service Provider reasonably believes to be necessary to assure compliance with applicable laws and such actions will not constitute a breach of this Agreement.  Such Service Provider shall notify the other party promptly of any decision to suspend or terminate any Services and the reasons for any such suspension or termination of such Services.

 

7.6          Entire Agreement; Amendment.  This Agreement, including the Schedules hereto, constitutes the entire agreement between SPX and Flowco with respect to the subject matter hereof.  This Agreement shall not be amended, altered or changed except by a written agreement signed by the parties hereto.

 

7.7          No Waiver.  No delay or omission on the part of either party to this Agreement in requiring performance by the other party or in exercising any right hereunder shall operate as a waiver of any provision hereof or of any right or rights hereunder; and the waiver, omission or delay in requiring performance or exercising any right hereunder on any one occasion shall not be

 

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construed as a bar to or waiver of such performance or right, or of any right or remedy under this Agreement, on any future occasion.

 

7.8          Notices.  Any notice, request, instruction or other document to be given hereunder by any party hereto to any other party shall be in writing and shall be given (and shall be deemed to have been duly given or made upon receipt unless the day of receipt is not a Business Day, in which case it shall be deemed to have been duly given or made on the next Business Day) by delivery in person, by overnight courier service, by facsimile with receipt confirmed (followed by delivery of an original via overnight courier service) or by registered or certified mail (postage prepaid, return receipt requested) to the respective parties at the following addresses:

 

	
If to SPX:

 

SPX Corporation

13320-A Ballantyne Corporate Place

Charlotte, NC    28277

Attention:  General Counsel

Telecopy number: [·]

 

If to SPX Representative:

 

SPX Corporation

13320-A Ballantyne Corporate Place

Charlotte, NC    28277

Attention:  [·]

Telecopy number: [·]

Email: [·]
    	
Copy to:

 

[·]
    
	
 
    	
 
    
	
If to Flowco:

 

SPX FLOW, Inc.

13320 Ballantyne Corporate Place

Charlotte, NC    28277

Attention:  General Counsel

Telecopy number: 704.752.7448

 

If to Flowco   Representative:

 

SPX FLOW, Inc.

13320 Ballantyne Corporate Place

Charlotte, NC    28277

Attention:  [·]

Telecopy number: [·]

Email: [·]
    	
Copy to:

 

[·]
    

 

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or at such other address for a party as shall be specified by like notice.

 

7.9          Severability.  If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of Law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any adverse manner to any party.  Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner so that the transactions contemplated hereby are fulfilled to the greatest extent possible.

 

7.10        Counterparts; Signatures.  This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all of which together shall constitute but one and the same agreement.  This Agreement may be executed by facsimile signature.

 

7.11        Governing Law, Etc.  This Agreement shall be construed in accordance with and governed by the laws of the State of Delaware applicable to agreements made and to be performed wholly within such jurisdiction.  Each of the parties hereto hereby irrevocably and unconditionally consents to submit to the exclusive jurisdiction of (a) the Court of Chancery of the State of Delaware (unless the Court of Chancery of the State of Delaware declines to accept jurisdiction over a particular matter, in which case, any state or federal court within the State of Delaware) and (b) so long as both parties are headquartered in North Carolina, any state or federal court within the State of North Carolina, for the purposes of any suit, action or other proceeding arising out of or relating to this Agreement (and agrees not to commence any such suit, action or other proceeding relating thereto except in such courts), and further agrees that service of any process, summons, notice or document by U.S. registered mail to its address set forth in Section 7.8 shall be effective service of process for any action, suit or proceeding in the Delaware or North Carolina courts with respect to any matters to which it has submitted to jurisdiction in this Section 7.11.

 

7.12        Conflict.  This Agreement is being executed and delivered pursuant to the terms and conditions of the Separation Agreement.  In the event of any inconsistency between the terms of this Agreement and the Separation Agreement, the terms of the Separation Agreement shall control.

 

7.13        Definitions; Interpretation.  When a reference is made in this Agreement to Sections or Schedules, such reference is to a Section of, or a Schedule to, this Agreement, unless otherwise indicated.  The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the words “herein,” “hereof,” “hereto” or “hereunder” are used in this Agreement, they shall be deemed to refer to this Agreement as a whole and not to any specific Section of this Agreement.  

 

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7.14        Effect if Distribution does not Occur. If the Distribution does not occur, then all actions and events that are, under this Agreement, to be taken or occur effective as of or following the Effective Date, or otherwise in connection with the Distribution, shall not be taken or occur except to the extent specifically agreed by the parties and neither party shall have any liability or further obligation to the other party under this Agreement.

 

Signature Page Follows

 

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IN WITNESS WHEREOF, Flowco and SPX have duly executed this Agreement as of the day, month and year first above written.

 

 

	
 
    	
SPX   CORPORATION
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
SPX   FLOW, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

Signature Page to Transition Services Agreement

 

 

SCHEDULE A

 

SPX Services

 

Attached.

 

 

SCHEDULE B

 

Flowco Services

 

Attached.Exhibit 10.2

 

TAX MATTERS AGREEMENT

 

by and between

 

SPX CORPORATION

 

and

 

SPX FLOW, Inc.

 

Dated as of [•], 2015

 

 

Table of Contents

 

	
ARTICLE I                                DEFINITIONS
    	
2
    
	
 
    	
 
    
	
ARTICLE II                           ALLOCATION   OF TAXES AND REFUNDS
    	
6
    
	
 
    	
 
    	
 
    
	
Section 2.1
    	
Responsibility for   Taxes
    	
6
    
	
Section 2.2
    	
Entitlement to Refunds
    	
7
    
	
Section 2.3
    	
Straddle Periods
    	
7
    
	
Section 2.4
    	
Temporary Differences
    	
7
    
	
 
    	
 
    	
 
    
	
ARTICLE III                      TAX   RETURNS
    	
7
    
	
 
    	
 
    	
 
    
	
Section 3.1
    	
Responsibility for   Preparation, Filing and Payment
    	
7
    
	
Section 3.2
    	
Consistent with Past   Practice
    	
8
    
	
Section 3.3
    	
Closing of Flowco   Taxable Year
    	
8
    
	
Section 3.4
    	
Carrybacks
    	
8
    
	
Section 3.5
    	
Tax Attributes
    	
8
    
	
Section 3.6
    	
Treatment of Deductions   Associated with Equity-Related Compensation
    	
9
    
	
Section 3.7
    	
Review Rights—Material   Adverse Effect
    	
9
    
	
Section 3.8
    	
Review Rights and   Reimbursement—Taxes for Which Non-Preparing Party is Responsible
    	
10
    
	
Section 3.9
    	
Refund Payments
    	
10
    
	
Section 3.10
    	
Expenses
    	
10
    
	
Section 3.11
    	
German Tax Payment
    	
10
    
	
 
    	
 
    	
 
    
	
ARTICLE IV                       TAX-FREE   STATUS OF THE TRANSACTIONS
    	
11
    
	
 
    	
 
    	
 
    
	
Section 4.1
    	
Representations and   Warranties
    	
11
    
	
Section 4.2
    	
Prohibited Events
    	
11
    
	
Section 4.3
    	
Procedures Regarding   Opinions and Rulings
    	
13
    
	
Section 4.4
    	
Protective Section 336(e) Elections
    	
13
    
	
Section 4.5
    	
Consistent Reporting
    	
13
    
	
 
    	
 
    	
 
    
	
ARTICLE V                            TAX   PROCEEDINGS
    	
14
    
	
 
    	
 
    	
 
    
	
Section 5.1
    	
Notice
    	
14
    
	
Section 5.2
    	
Conduct
    	
14
    
	
 
    	
 
    	
 
    
	
ARTICLE VI                       COOPERATION
    	
15
    
	
 
    	
 
    	
 
    
	
Section 6.1
    	
General Cooperation
    	
15
    
	
Section 6.2
    	
Retention of Records
    	
15
    
	
 
    	
 
    	
 
    
	
ARTICLE VII                  INDEMNIFICATION
    	
15
    
	
 
    	
 
    	
 
    
	
Section 7.1
    	
Survival
    	
15
    
	
Section 7.2
    	
Indemnification by   Infrastructurco
    	
15
    

 

i

 

Table of Contents

 

	
Section 7.3
    	
Indemnification by   Flowco
    	
15
    
	
Section 7.4
    	
Flowco Gross-Up   Obligation
    	
15
    
	
Section 7.5
    	
Characterization of   Indemnification and Reimbursement Payments
    	
16
    
	
 
    	
 
    	
 
    
	
ARTICLE VIII             MISCELLANEOUS
    	
16
    
	
 
    	
 
    	
 
    
	
Section 8.1
    	
Dispute Resolution
    	
16
    
	
Section 8.2
    	
Tax Sharing Agreements
    	
16
    
	
Section 8.3
    	
Specific Performance
    	
16
    
	
Section 8.4
    	
Interest
    	
17
    
	
Section 8.5
    	
Coordination with the   Separation Agreement and Other Ancillary Agreements
    	
17
    
	
Section 8.6
    	
Effective Date
    	
17
    

 

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TAX MATTERS AGREEMENT

 

THIS TAX MATTERS AGREEMENT (this “Agreement”) is entered into as of [·], 2015, by and between SPX Corporation, a Delaware corporation (“SPX” or “Infrastructurco”), and SPX FLOW, Inc., a Delaware corporation and wholly-owned subsidiary of SPX (“Flowco”) (each a “Party” and together, the “Parties”).

 

R  E  C  I  T  A  L  S:

 

WHEREAS, SPX currently conducts the Infrastructurco Business and the Flowco Business directly and through its Subsidiaries, and is the common parent of an affiliated group (within the meaning of Section 1504 of the Code) of corporations filing a consolidated return for U.S. federal income tax purposes (the “SPX Consolidated Group”);

 

WHEREAS, the Board of Directors of SPX has determined that it is in the best interests of SPX and its stockholders to separate SPX into two separate, publicly traded companies: (i) Infrastructurco, which will continue to conduct, directly and through its Subsidiaries, the Infrastructurco Business, and (ii) Flowco, which will conduct, directly and through its Subsidiaries, the Flowco Business;

 

WHEREAS, in order to effect such separation, (i) SPX and certain of its Subsidiaries will enter into the transactions described in the Reorganization Steps Plan (such transactions, excluding the Flowco Asset Transfer and the Distribution, the “Restructuring”); (ii) pursuant to the Reorganization Step Plan, SPX will, and will cause certain of its Subsidiaries to, transfer (directly or indirectly) the Flowco Assets to Flowco in actual or constructive exchange for (a) the issuance by Flowco to SPX of shares of the common stock of Flowco, (b) the substitution of Flowco for SPX as the obligor under the Notes, (c) the distribution by Flowco to SPX of the proceeds of Flowco debt issued to one or more banks pursuant to the Flowco Financing Arrangements (the “Debt Proceeds”), and (d) the assumption by Flowco (directly or indirectly) of the Flowco Liabilities (the transactions described in this clause (ii), the “Flowco Asset Transfer”); (iii) SPX will use the Debt Proceeds to repay historic third-party indebtedness; and (iv) SPX will distribute all of the common stock of Flowco to the holders of SPX Common Stock as of the Record Date on a pro rata basis (the “Distribution”);

 

WHEREAS, the Distribution is motivated in whole or substantial part by the corporate business purpose of enhancing the fit and focus of the Infrastructurco Business and the Flowco Business, including by (i) allowing management to focus exclusively on either the Infrastructurco Business or the Flowco Business, (ii) more closely aligning management incentives with the goals and objectives of either the Infrastructurco Business or the Flowco Business through equity compensation, and (iii) allowing Flowco to fund acquisitions with its equity on significantly more favorable terms than those that would be available to Infrastructurco;

 

WHEREAS, the Parties intend, for U.S. federal income tax purposes, for (i) certain steps of the Restructuring to qualify as tax-free transactions; (ii) the Flowco Asset Transfer to qualify as a reorganization described in Section 368(a)(1)(D) of the Code; (iii) the substitution of Flowco for SPX as the obligor under the Notes to be treated as an issuance by Flowco to SPX of

 

 

“securities” (within the meaning of Section 361(a) of the Code) in partial consideration for the Flowco Asset Transfer (in an exchange governed by Section 361(a) of the Code), followed by a distribution by SPX of such securities to holders of the Notes in exchange for the Notes (in an exchange governed by Section 355(a)(1)(A)(ii) of the Code); and (iv) the Distribution to qualify as a transaction described in Section 355(a) of the Code;

 

WHEREAS, as a result of the Distribution, the Flowco Entities that were members of the SPX Consolidated Group will cease to be members of the SPX Consolidated Group (the “Deconsolidation”); and

 

WHEREAS, the Parties intend in this Agreement to allocate economic responsibility for Taxes arising prior to, as a result of, and subsequent to the Distribution, and to provide for and agree upon certain other matters relating to Taxes.

 

NOW, THEREFORE, in consideration of the foregoing and the terms, conditions, covenants and provisions of this Agreement, the Parties hereby agree as follows:

 

ARTICLE I
 DEFINITIONS

 

Any capitalized term used in this Agreement but not defined herein shall have the meaning ascribed to it in the Separation Agreement.  For purposes of this Agreement, the following terms shall have the following meanings:

 

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

 

“Carryback” has the meaning set forth in Section 3.4.

 

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

 

“Counsel” means (i) Fried, Frank, Harris, Shriver & Jacobson LLP, with respect to the Flowco Asset Transfer and the Distribution, and (ii) Baker & McKenzie LLP, with respect to the Restructuring.

 

“Debt Proceeds” has the meaning set forth in the recitals.

 

“Deconsolidation” has the meaning set forth in the recitals.

 

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

 

“Distribution Date” means the date of the consummation of the Distribution, which shall be determined by the Board of Directors of SPX in its sole and absolute discretion.

 

“Due Date” means (a) with respect to a Tax Return, the date (taking into account all valid extensions) on which such Tax Return is required to be filed under applicable Law and (b) with respect to a payment of Taxes, the date on which such payment is required to be made to avoid the incurrence of interest, penalties and/or additions to tax.

 

“Effective Time” means the time at which the Distribution is effective on the Distribution

 

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Date.

 

“Final Determination” means any final resolution of liability for any Tax for any taxable period, by or as a result of (a) a final decision, judgment, decree or other order by any court of competent jurisdiction that can no longer be appealed, (b) a final settlement with the IRS, a closing agreement or accepted offer in compromise under Sections 7121 or 7122 of the Code, or a comparable agreement under the Laws of any other jurisdiction, which resolves the entire Tax liability for any taxable period, (c) any 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, or (d) any other final resolution, including by reason of the expiration of the applicable statute of limitations or the execution of a pre-filing agreement with the IRS or other Taxing Authority.

 

“Flowco” has the meaning set forth in the preamble.

 

“Flowco Entity” means any of Flowco and any entity (including any predecessor thereof) that will be a Subsidiary of Flowco immediately after the Effective Time.

 

“Flowco Prohibited Event” means any Prohibited Event that Flowco causes or permits to occur.

 

“Flowco PTI Taxes” means any U.S. federal income taxes resulting from a Final Determination and attributable to amounts included in the gross income of a Flowco Entity or an Infrastructurco Entity under Section 951(a) of the Code on account of a Flowco Entity that is a “controlled foreign corporation” (within the meaning of Section 957(a) of the Code), to the extent that no Infrastructurco Entity received, prior to the Effective Time, a distribution of the earnings and profits corresponding to such income inclusion.

 

“Income Tax” means any income, franchise or similar tax based upon, measured by or calculated by reference to net income or net profits (including any liability under Treasury Regulations Section 1.1502-6), together with any interest, penalty or addition attributable thereto.

 

“Infrastructurco” has the meaning set forth in the preamble.

 

“Infrastructurco Entity” means any of Infrastructurco and any entity (including any predecessor thereof) that will be a Subsidiary of Infrastructurco immediately after the Effective Time.

 

“Infrastructurco Prohibited Event” means any Prohibited Event that Infrastructurco causes or permits to occur.

 

“IRS” means the U.S. Internal Revenue Service.

 

“Notes” means SPX’s 6.875 % Senior Notes due 2017 subject to the Indenture.

 

“Opinions” means the opinions of Counsel with respect to certain Tax aspects of the Transactions.

 

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“Party” and “Parties” have the meanings set forth in the preamble.

 

“Past Practice” means past custom, practices, accounting methods, elections and conventions.

 

“Permitted Carryback” has the meaning set forth in Section 3.4.

 

“Post-Distribution Period” means any taxable period (or portion thereof) beginning after the Distribution Date, including for the avoidance of doubt, the portion of any Straddle Period beginning after the Distribution Date.

 

“Pre-Distribution Period” means any taxable period (or portion thereof) ending on or before the Distribution Date, including for the avoidance of doubt, the portion of any Straddle Period ending at the end of the day on the Distribution Date.

 

“Pre-Distribution Flowco State Income Taxes” means any U.S. state Income Taxes incurred by any Flowco Entity in any Pre-Distribution Period (excluding, for the avoidance of doubt, any such Taxes that are attributable to any action taken by a Flowco Entity on the Distribution Date after the Effective Time).

 

“Prohibited Event” has the meaning set forth in Section 4.2(a).

 

“Refund” means any refund of Taxes or any credit for Taxes in lieu thereof, including any interest payable thereon or with respect thereto.

 

“Restructuring” has the meaning set forth in the recitals.

 

“Ruling Request” means the request for rulings submitted to the IRS by Counsel on January 21, 2015, regarding the U.S. federal income tax treatment of the substitution of Flowco for SPX as the obligor under the Notes (including the exhibits thereto and any supplemental submissions).

 

“Separation Agreement” means that certain Separation and Distribution Agreement entered into as of [·], 2015, by and between SPX and Flowco, which sets forth the principal arrangements between SPX and Flowco with respect to the Separation.

 

“Spin-Off Taxes” means any Taxes that are not attributable to a Prohibited Event and that are attributable to (i) the Restructuring, the Flowco Asset Transfer, the Distribution or the Deconsolidation or (ii) the settlement of any intercompany receivable, payable, loan or other account between any Flowco Entity and any Infrastructurco Entity pursuant to Section 2.4 of the Separation Agreement.

 

“SPX” has the meaning set forth in the preamble.

 

“SPX Consolidated Group” has the meaning set forth in the recitals.

 

“SPX Consolidated Taxes” means any U.S. federal, state or local Income Taxes reported or reportable on any Tax Return filed or required to be filed by an Infrastructurco Entity in its

 

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capacity as the common parent of an affiliated (or similar) group of corporations that reports its U.S. federal, state or local Income Taxes, respectively, on a consolidated (or similar) basis.

 

“Straddle Period” means any taxable period that begins on or before and ends after the Distribution Date.

 

“Tax” means any tax, charge, fee, duty, levy, impost, or other similar assessment, in each case imposed by any governmental authority, including, but not limited to, any net income (including any liability under Treasury Regulations Section 1.1502-6(a)), gross income, gross receipts, excise, real property, personal property, sales, use, service, service use, license, lease, capital stock, transfer, recording, franchise, business organization, occupation, premium, environmental, windfall profits, profits, customs, payroll, unclaimed property, wage, withholding, social security, employment, unemployment, insurance, severance, workers compensation, excise, stamp, alternative minimum, estimated, value added, ad valorem or other tax, in each case, together with any interest, penalty or addition attributable thereto.

 

“Tax Attribute” means any net operating loss, capital loss, investment tax credit carryover, earnings and profits, foreign tax credit carryover, overall foreign loss, previously taxed income, separate limitation loss or any other loss, deduction, credit or other comparable item.

 

“Tax Benefit” means any Refund, deduction, credit, or other item that reduces the amount of Taxes otherwise required to be paid.

 

“Tax-Free Status of the Transactions” means the tax-free treatment for which certain of the Transactions are intended to qualify, as described in the Opinions.

 

“Tax Materials” means (i) the Opinions, (ii) the representation letters from SPX and Flowco upon which Counsel will rely in rendering the Opinions, (iii) the Ruling Request, and (iv) any other materials delivered or deliverable by SPX or Flowco in connection with the rendering by Counsel of the Opinions or the consideration by the IRS of the Ruling Request.

 

“Tax Proceeding” means any audit, assessment, review, examination or other proceeding (including any appeal thereof) administered by any Taxing Authority for the purpose of determining or redetermining any Tax or Refund, including any proceeding relating to a competent authority determination.

 

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

 

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

 

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“Transactions” means the transactions described in the Reorganization Steps Plan.

 

“Treasury Regulations” means the regulations promulgated under the Code by the U.S. Treasury Department.

 

“Unqualified Tax Opinion” means a “will” opinion, without substantive qualifications, of a nationally recognized law or accounting firm, which firm is reasonably acceptable to the Party not receiving such Unqualified Tax Opinion.

 

“U.S.” means the United States of America.

 

ARTICLE II
 ALLOCATION OF TAXES AND REFUNDS

 

Section 2.1                           Responsibility for Taxes.  Economic responsibility for Taxes shall be allocated between the Parties as follows:

 

(a)                                 Infrastructurco shall be responsible for:

 

(i)                                     any Taxes attributable to any of the activities of the Infrastructurco Business or any of the Infrastructurco Assets or Infrastructurco Liabilities;

 

(ii)                                  any SPX Consolidated Taxes;

 

(iii)                               any Pre-Distribution Flowco State Income Taxes;

 

(iv)                              any sales, use, unclaimed property or escheat taxes incurred in any Pre-Distribution Period with respect to SPX’s corporate headquarters;

 

(v)                                 any Taxes attributable to an Infrastructurco Prohibited Event; and

 

(vi)                              any Spin-Off Taxes;

 

provided, however, that Infrastructurco shall not be responsible for any Taxes for which Flowco is responsible under clause (ii) or clause (iii) of Section 2.1(b).

 

(b)                                 Flowco shall be responsible for:

 

(i)                                     any Taxes that are (A) attributable to any of the activities of the Flowco Business or any of the Flowco Assets or Flowco Liabilities and (B) not described in Section 2.1(a);

 

(ii)                                  all Flowco PTI Taxes for any taxable year, but only if all Flowco PTI Taxes in such taxable year exceed, in the aggregate, $100,000 (in which case, for the avoidance of doubt, Flowco shall be responsible for all such Flowco PTI Taxes); and

 

(iii)                               any Taxes attributable to a Flowco Prohibited Event, but only if such Taxes exceed, in the aggregate, $100,000 (in which case, for the avoidance of doubt, Flowco shall be responsible for all such Taxes).

 

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Section 2.2                           Entitlement to Refunds.  Refunds shall be allocated between the Parties as follows:

 

(a)                                 Infrastructurco shall be entitled to any Refund in respect of Taxes for which Infrastructurco is responsible pursuant to Section 2.1(a), except to the extent such Refund is attributable to a Permitted Carryback.

 

(b)                                 Flowco shall be entitled to (i) any Refund in respect of Taxes for which Flowco is responsible pursuant to Section 2.1(b) and (ii) any other Refund, to the extent such Refund is attributable to a Permitted Carryback.

 

Section 2.3                           Straddle Periods.  To the extent necessary for purposes of this Agreement, any Tax incurred with respect to any Straddle Period shall be apportioned between the Pre-Distribution portion and the Post-Distribution portion of such Straddle Period as follows:

 

(a)                                 any such Tax based on or measured by income, receipts, services or transactions (including Income Taxes and sales, use, withholding, payroll and other employment taxes, but not including real and personal property taxes) shall be apportioned between the Pre-Distribution portion and the Post-Distribution portion of such Straddle Period based on an interim closing of the books as of the Effective Time; provided, however, that any exemption, allowance or deduction that is calculated on an annual or periodic basis shall be apportioned on a per diem basis; and

 

(b)                                 any such Tax not described in Section 2.3(a) shall be apportioned between the Pre-Distribution portion and the Post-Distribution portion of such Straddle Period on a per diem basis.

 

Section 2.4                           Temporary Differences.  If, as a result of a Final Determination relating to Taxes for which Infrastructurco or Flowco is responsible under Section 2.1(a) or Section 2.1(b), respectively, any Flowco Entity or any Infrastructurco Entity, respectively, reports, with respect to any taxable year, any Tax Benefit that (a) results in Tax savings for such taxable year of at least $50,000 and (b) it would not have reported but for such Final Determination (including, for the avoidance of doubt, any Tax Benefit resulting from the election under Section 336(e) of the Code described in Section 4.4), then such Flowco Entity or Infrastucturco Entity, as the case may be, shall make a payment to Infrastructurco or Flowco, respectively, equal to the actual reduction of Taxes attributable to such Tax Benefit (determined on a with and without basis), such payment to be made promptly after filing the annual U.S. federal corporate income tax return on which such Tax Benefit is reported (i.e., if such a Final Determination results in Tax Benefits over multiple taxable years, payments shall be made only as and when any reduction in annual Taxes attributable to such Tax Benefits occurs).

 

ARTICLE III
 TAX RETURNS

 

Section 3.1                           Responsibility for Preparation, Filing and Payment.  With respect to any Tax Return for a Pre-Distribution Period or Straddle Period required to be filed by an Infrastructurco Entity or a Flowco Entity:

 

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(a)                                 Infrastructurco shall prepare and file, or cause to be prepared and filed, any such Tax Return required by Law to be filed by an Infrastructurco Entity, and shall pay or cause to be paid any Taxes shown to be due and owing thereon; and

 

(b)                                 Flowco shall prepare and file, or cause to be prepared and filed, any such Tax Return required by Law to be filed by a Flowco Entity, and shall pay or cause to be paid any Taxes shown to be due and owing thereon;

 

provided, however, that, in the case of any such consolidated or combined tax return, each non-filing entity included in such tax return shall, at the request of the filing entity, prepare and deliver to the filing entity any supporting tax returns or other documents that relate to such non-filing entity and are necessary to the preparation of such consolidated or combined tax return; and

 

provided, further, that (x) Flowco shall prepare and file, or cause to be prepared and filed, any such Tax Return relating to sales or use taxes, and (y) Infrastructurco shall prepare and file, or cause to be prepared and filed, any such Tax Return relating to unclaimed property or escheat taxes.

 

Section 3.2                           Consistent with Past Practice.  Unless otherwise agreed by the Parties, and except to the extent otherwise required by applicable Law, each Tax Return described in Section 3.1 shall be prepared in a manner consistent with Past Practice.

 

Section 3.3                           Closing of Flowco Taxable Year.  Infrastructurco and Flowco shall use reasonable best efforts to close the taxable year of each Flowco Entity for all U.S. federal and state income tax purposes as of the end of the Distribution Date, to the extent permitted by applicable Law.

 

Section 3.4                           Carrybacks.  Except to the extent otherwise consented to by Infrastructurco or prohibited by applicable Law, Flowco shall cause each Flowco Entity to elect to relinquish, waive or otherwise forego the carryback of any loss, credit or other Tax Attribute from any Post-Distribution Period to any Pre-Distribution Period or Straddle Period (a “Carryback”).  In the event that a Flowco Entity is permitted under the preceding sentence to effect a Carryback (such Carryback, a “Permitted Carryback”), Infrastructurco shall cooperate with Flowco in seeking any corresponding Refund; provided, however, that Flowco shall indemnify and hold the Infrastructurco Entities harmless from and against any and all collateral Tax consequences resulting from or caused by such Permitted Carryback, including, without limitation, the loss or postponement of any benefit from the use of Tax Attributes generated by an Infrastructurco Entity if (a) such Tax Attributes expire unutilized, but would have been utilized but for such Carryback, or (b) the use of such Tax Attributes is postponed to a later taxable period than the taxable period in which such Tax Attributes would have been utilized but for such Carryback.

 

Section 3.5                           Tax Attributes.

 

(a)                                 Infrastructurco and Flowco shall, prior to any relevant Due Date, jointly determine in good faith the allocation of Tax Attributes arising in Pre-Distribution Periods and in existence immediately after the Effective Time between Infrastructurco Entities and Flowco Entities in accordance with applicable Law, including Treasury Regulations Sections 1.1502-

 

8

 

9T(c), 1.1502-21, 1.1502-21T, 1.1502-22, 1.1502-79 and, if applicable, 1.1502-79A (and any applicable state, local and foreign Laws); provided, however, that:

 

(i)                                     earnings and profits shall be allocated in accordance with Code Section 312(h) and Treasury Regulations Section 1.312-10(a);

 

(ii)                                  any earnings and profits allocated to any Flowco Entity shall include both non-previously taxed income within the meaning of Code Section 959(c)(3) and previously taxed income (as defined in Code Section 959(a));

 

(iii)                               Infrastructurco shall be entitled to make any determination as to (A) basis, and (B) valuation, and shall make such determination consistent with Past Practice, where applicable.

 

For the avoidance of doubt, any previously taxed income (as defined in Code Section 959(a)) in existence immediately after the Effective Time shall be allocated to the corporation to which such previously taxed income is attributable for U.S. federal income tax purposes (including any successor to such corporation). Infrastructurco and Flowco hereby agree to compute all Taxes for Post-Distribution Periods consistently with the determination of the allocation of Tax Attributes pursuant to this Section 3.5(a) 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 Taxing Authority or Tax Proceeding, such reduction or increase shall be allocated to the Party to which such Tax Attribute was allocated pursuant to Section 3.5(a), except to the extent otherwise required by applicable Law.

 

Section 3.6                           Treatment of Deductions Associated with Equity-Related Compensation.

 

(a)                                 From and after the Distribution Date, only the current or most recent employer of the relevant employee may claim any Tax deduction in respect of any equity award or other incentive compensation of such employee described in Section [·] of the Employee Matters Agreement, except to the extent otherwise required by applicable Law.

 

(b)                                 If, as a result of a Final Determination, an Infrastructurco Entity or Flowco Entity realizes a Tax Benefit from a deduction to which a Flowco Entity or Infrastructurco Entity, respectively, is entitled pursuant to Section 3.6(a), then Infrastructurco or Flowco, as the case may be, shall pay or cause to be paid to Flowco or Infrastructurco, respectively, an amount equal to the value of such Tax Benefit (determined on a with and without basis), such payment to be made promptly after filing the Tax Return on which such Tax Benefit is reflected.

 

Section 3.7                           Review Rights—Material Adverse Effect.  If a Tax Return prepared by an Infrastructurco Entity or a Flowco Entity pursuant to Section 3.1 takes a position that would reasonably be expected to materially adversely affect any Flowco Entity or any Infrastructurco Entity, respectively, the Party responsible for preparing such Tax Return under Section 3.1 shall deliver a draft of such Tax Return (or of the relevant portions of such Tax Return) to the non-preparing Party for its review and comment, such delivery to be made a reasonable amount of time prior to the Due Date (it being understood and agreed that in the case of any such Tax Return for U.S. federal Income Taxes or other material Taxes, “a reasonable amount of time” means at least thirty (30) days prior to the Due Date).  The Parties shall attempt to resolve any

 

9

 

dispute regarding the preparation of such Tax Return through good faith negotiation before resorting to the dispute resolution procedures contained in Section 8.1.  In the event that any such dispute is not resolved prior to the Due Date, the Tax Return shall be timely filed and subsequently amended as necessary to reflect the resolution of such dispute.

 

Section 3.8                           Review Rights and Reimbursement—Taxes for Which Non-Preparing Party is Responsible.  If a Tax Return prepared by an Infrastructurco Entity or a Flowco Entity pursuant to Section 3.1 reflects Taxes for which Flowco or Infrastructurco, respectively, is responsible under Section 2.1, the Party responsible for preparing such Tax Return under Section 3.1 shall deliver a draft of such Tax Return (or of the relevant portions of such Tax Return), together with a written calculation of the amount of Taxes reflected thereon for which the non-preparing Party is responsible under Section 2.1, to the non-preparing Party for its review and comment, such delivery to be made a reasonable amount of time prior to the Due Date (it being understood and agreed that in the case of any such Tax Return for U.S. federal Income Taxes or other material Taxes, “a reasonable amount of time” means at least thirty (30) days prior to the Due Date).  The non-preparing Party shall pay the preparing Party the amount of Taxes for which the non-preparing Party is responsible under Section 2.1 at least two (2) business days before the Due Date for the payment of such Taxes (whether or not the non-preparing Party disputes such amount).  The Parties shall attempt to resolve any dispute regarding the preparation of such Tax Return or the amount of Taxes reflected thereon for which the non-preparing Party is responsible under Section 2.1 through good faith negotiation before resorting to the dispute resolution procedures contained in Section 8.1.  In the event that any such dispute is not resolved prior to the Due Date, the Tax Return shall be timely filed and subsequently amended as necessary to reflect the resolution of such dispute, and/or the preparing Party shall return to the non-preparing Party any amounts paid by the non-preparing Party but which are determined to be the responsibility of the preparing Party under Section 2.1, as applicable.

 

Section 3.9                           Refund Payments.  A Party that receives a Refund to which the other Party is entitled in whole or in part under Section 2.2 shall pay to the other Party the portion to which the other Party is entitled, net of any Taxes or other costs (other than Tax Return preparation expenses) incurred by the preparing Party in connection with the receipt or accrual of such Refund and attributable to such portion, within ten (10) days after (a) receipt of the Refund in cash or (b) the filing of the relevant Tax Return (in the case of a Refund that is a credit against payment of future Taxes).

 

Section 3.10                    Expenses.  Notwithstanding anything to the contrary herein, each Party shall bear its own expenses in preparing any Tax Return governed by Section 3.1.

 

Section 3.11                    German Tax Payment.  To the extent required by German law, SPX U.L.M. GmbH shall contribute cash to SPX Cooling Technologies Leipzig GmbH equal to the amount of the combined tax loss sustained by Infrastructurco Entities organized under German law.  In the event SPX U.L.M. GmbH contributes cash to SPX Cooling Technologies Leipzig GmbH pursuant to the previous sentence, Infrastructurco shall, at the same time, make a payment of equivalent amount to Flowco.

 

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ARTICLE IV
 TAX-FREE STATUS OF THE TRANSACTIONS

 

Section 4.1                           Representations and Warranties.

 

(a)                                 By Flowco.  Flowco hereby represents and warrants that the facts presented and the statements and representations made in the Tax Materials are true, correct and complete in all respects to the extent they relate to any Flowco Entity with respect to any period of time following the Effective Time.

 

(b)                                 By SPX.  SPX hereby represents and warrants that the facts presented and the statements and representations made in the Tax Materials are true, correct and complete in all respects to the extent they relate to either (i) any Infrastructurco Entity, whether preceding or following the Effective Time or (ii) any Flowco Entity with respect to any period of time preceding the Effective Time.

 

(c)                                  No Contrary Knowledge.  Each of SPX and Flowco represents and warrants that it knows of no fact (after due inquiry) that may adversely affect the Tax-Free Status of the Transactions.

 

(d)                                 No Contrary Plan.  Each of SPX and Flowco represents and warrants that neither it nor any of its Affiliates has any plan or intention to take any action, or to fail to take any action, in a manner that would be inconsistent with any fact presented or statement or representation made in the Tax Materials.

 

Section 4.2                           Prohibited Events.

 

(a)                                 From the Effective Time to the first day following the second anniversary of the Distribution, neither Flowco nor Infrastructurco may (each of the following actions and events, a “Prohibited Event”):

 

(i)                                     (A) with respect to Flowco, fail to cause to be continued the active conduct of the Flowco Business as conducted immediately prior to the Distribution, or (B) with respect to Infrastructurco, fail to cause to be continued the active conduct of the Infrastructurco Business as conducted immediately prior to the Distribution;

 

(ii)                                  voluntarily dissolve or liquidate (or take any other action that would be treated as a liquidation for U.S. federal income tax purposes);

 

(iii)                               (A) with respect to Flowco, cause or permit to occur any event (or series of events) involving the capital stock of Flowco, any assets of Flowco or any assets of any Flowco Entity, or (B) with respect to Infrastructurco, permit to occur any event (or series of events) involving the capital stock of Infrastructurco, any assets of Infrastructurco or any assets of any Infrastructurco Entity, in each case, that adversely affects, or could reasonably be expected to adversely affect, the Tax-Free Status of the Transactions;

 

(iv)                              (A) with respect to Flowco, cause or permit to occur any transaction or series of transactions (or any agreement, understanding or arrangement, within the meaning of Section 355(e) of the Code and the Treasury Regulations promulgated thereunder, to enter into a transaction or series of

 

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transactions), whether such transaction is supported by management or shareholders, is a hostile acquisition, or otherwise, that would, when combined with any other direct or indirect changes in stock ownership, result in a direct or indirect acquisition (within the meaning of Section 355(e) of the Code) of 40% or more of (1) the value of all outstanding shares of stock or (2) the total combined voting power of all outstanding shares of voting stock, in either case, of Flowco, as of the date of such transaction, or in the case of a series of transactions, the date of the last transaction in such series, or (B) with respect to Infrastructurco, permit to occur any transaction or series of transactions (or any agreement, understanding or arrangement, within the meaning of Section 355(e) of the Code and the Treasury Regulations promulgated thereunder, to enter into a transaction or series of transactions), whether such transaction is supported by management or shareholders, is a hostile acquisition, or otherwise, that would, when combined with any other direct or indirect changes in stock ownership, result in a direct or indirect acquisition (within the meaning of Section 355(e) of the Code) of 40% or more of (1) the value of all outstanding shares of stock or (2) the total combined voting power of all outstanding shares of voting stock, in either case, of Infrastructurco, as of the date of such transaction, or in the case of a series of transactions, the date of the last transaction in such series; or

 

(v)                                 (A) with respect to Flowco, take or permit to be taken by any Flowco Entity any other action that (1) would be inconsistent with any fact presented or statement or representation made in the Tax Materials or any representation, warranty or covenant contained herein or (2) adversely affects, or could reasonably be expected to adversely affect, the Tax-Free Status of the Transactions, or (B) with respect to Infrastructurco, take or permit to be taken by any Infrastructurco Entity any other action that (1) would be inconsistent with any fact presented or statement or representation made in the Tax Materials or any representation, warranty or covenant contained herein or (2) adversely affects, or could reasonably be expected to adversely affect, the Tax-Free Status of the Transactions;

 

provided, however, that the following actions shall not be taken into account for purposes of this Section 4.2(a) (and shall be excluded from the definition of “Prohibited Event”):

 

(vi)                              any repurchase by Flowco or by Infrastructurco of stock of Flowco or Infrastructurco, respectively, that (A) satisfies the requirements set forth in Section 4.05(1)(b) of Revenue Procedure 96-30, 1996-1 C.B. 696 (as in effect prior to the amendment of such Revenue Procedure by Revenue Procedure 2003-48, 2003-2 C.B. 86), (B) could not reasonably be expected to adversely affect the Tax-Free Status of the Transactions, and (C) is not an acquisition that would be taken into account in applying Section 355(e)(2)(A)(ii) of the Code;

 

(vii)                           any adoption of, or issuance of stock pursuant to, a shareholder rights plan that is described in or is similar to the shareholder rights plan described in Revenue Ruling 90-11, 1990-1 C.B. 10; and

 

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(viii)                        any issuance of stock that satisfies Safe Harbor VIII (relating to acquisitions in connection with a person’s performance of services) or Safe Harbor IX (relating to acquisitions by a retirement plan of an employer) of Treasury Regulations Section 1.355-7(d).

 

(b)                                 Notwithstanding the general prohibition imposed by Section 4.2(a), either Party may cause or permit to occur a Prohibited Event if (i) such Party has provided to the other Party an Unqualified Tax Opinion, in form and substance reasonably satisfactory to the other Party, that such Prohibited Event will not adversely affect the Tax-Free Status of the Transactions, (ii) such Party has received a private letter ruling from the IRS that such Prohibited Event will not adversely affect the Tax-Free Status of the Transactions, or (iii) the other Party has consented in writing to such Prohibited Event; provided, however, that, for the avoidance of doubt, a Party’s satisfaction of the conditions described in this Section 4.2(b) shall not affect such Party’s responsibility under Section 2.1 for any Taxes attributable to such Prohibited Event.  In determining whether an Unqualified Tax Opinion is satisfactory, the other Party may consider, among other factors, the appropriateness of any assumptions or representations supporting such Unqualified Tax Opinion and the strength of any reasoning contained therein.

 

Section 4.3                           Procedures Regarding Opinions and Rulings.

 

(a)                                 Except with respect to the Ruling Request, neither Infrastructurco nor Flowco may seek any guidance from the IRS or any other Taxing Authority (whether written, verbal or otherwise) at any time concerning the Restructuring, the Flowco Asset Transfer, the Distribution or the Deconsolidation without the other Party’s prior written consent (which may not be unreasonably conditioned, delayed or withheld).  The Parties shall cooperate in good faith regarding any such request for guidance undertaken with such consent.

 

(b)                                 Each Party shall use its reasonable best efforts to comply with any reasonable request made by the other Party in connection with any attempt by such other Party to secure an Unqualified Tax Opinion regarding a Prohibited Event.

 

Section 4.4                           Protective Section 336(e) Elections.  Infrastructurco and Flowco shall make a protective election under Section 336(e) of the Code (and any similar election under state or local law) in accordance with Treasury Regulations Section 1.336-2(h) and (j) (and any applicable provisions under state and local law), and shall cooperate in the timely completion and/or filings of such elections and any related filings or procedures (including filing or amending any Tax Returns to implement a protective election that becomes effective) and the execution of any necessary agreements, with respect to (i) the Distribution and (ii) such qualified stock dispositions of Subsidiaries of Flowco as Flowco shall designate resulting from the asset sales deemed to occur pursuant to the protective elections under Section 336(e) of the Code contemplated by this Section 4.4.  This Section 4.4 is intended to constitute a binding, written agreement to make an election under Section 336(e) of the Code with respect to the Distribution and deemed sales of subsidiaries.  To the extent the protective elections contemplated by this Section 4.4 result in Tax Benefits, Section 2.4 contains a payment obligation with respect to such Tax Benefits in certain cases.

 

Section 4.5                           Consistent Reporting.  Each of Infrastructurco and Flowco covenants and agrees that it will not take, and will cause its respective Affiliates to refrain from taking, any position on any Tax Return, in connection with any Tax Proceeding or otherwise that is

 

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inconsistent with the Tax-Free Status of the Transactions, notwithstanding any other provision herein, except to the extent otherwise required pursuant to a Final Determination.

 

ARTICLE V
 TAX PROCEEDINGS

 

Section 5.1                           Notice.  Within ten (10) days after a Party or any of its Affiliates becomes aware of the commencement of a Tax Proceeding that (a) reasonably could be expected to have a material adverse effect on the other Party, (b) relates to Taxes or a Refund for which the other Party is responsible or to which the other Party is entitled under ARTICLE II, or (c) relates to Spin-Off Taxes or a Prohibited Event, such Party shall notify the other in writing of such Tax Proceeding, and shall promptly forward or make available copies of any written communications with a Taxing Authority in connection with such Tax Proceeding.  Any failure of a Party to comply with the preceding sentence shall not relieve the other Party of any indemnification obligation hereunder except to the extent that such Party is actually prejudiced by such failure.

 

Section 5.2                           Conduct.

 

(a)                                 General Rule.  To the extent feasible and requested by either Party, control of the conduct of any Tax Proceeding described in Section 5.1 shall be divided between the Parties in accordance with each Party’s economic interest in such Tax Proceeding, taking into account any indemnification obligations and the other provisions of this Agreement (e.g., each Party shall be entitled to control the conduct of any aspects of such Tax Proceeding that relate primarily to Taxes for which such Party is responsible under Section 2.1).  The Parties shall cooperate in good faith regarding any procedural or other aspects of such Tax Proceeding that do not implicate the economic interests of one Party disproportionately, and any disputes regarding the application of this Section 5.2(a) shall be resolved in accordance with Section 8.1.

 

(b)                                 Alternative Procedure.  If division of control of a Tax Proceeding as contemplated by Section 5.2(a) is not feasible, the Party whose economic interest in such Tax Proceeding is greater, taking into account any indemnification obligations and the other provisions of this Agreement, shall be entitled (but not obligated) to control the conduct of such Tax Proceeding.

 

(c)                                  Notice and Participation Rights.  The Party that controls the conduct of any Tax Proceeding (or portion thereof) pursuant to Section 5.2(a) or Section 5.2(b) shall, to the extent requested by the other Party:

 

(i)                                     keep the other Party reasonably and timely informed regarding such Tax Proceeding (or portion thereof);

 

(ii)                                  permit the other Party to attend any formally scheduled meetings with a Taxing Authority in relating to such Tax Proceeding (or portion thereof); and

 

(iii)                               not settle such Tax Proceeding (or portion thereof) without the prior written consent of the other Party, which consent shall not be unreasonably withheld, delayed or conditioned.

 

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(d)                                 Power of Attorney.  Infrastructurco shall execute and deliver to Flowco (or Flowco’s designee) any power of attorney or other similar document reasonably requested by Flowco in connection with any Tax Proceeding regarding a Flowco Prohibited Event.

 

ARTICLE VI
 COOPERATION

 

Section 6.1                           General Cooperation.  Each Party shall, and shall cause its Affiliates to, provide such cooperation or information relating to any Tax, Refund, Tax Return or Tax Proceeding as the other Party (or any of its Affiliates) reasonably requests in writing, including by making its employees, advisors, and facilities available, without charge, on a reasonable and mutually convenient basis.

 

Section 6.2                           Retention of Records.  Each Infrastructurco Entity and Flowco Entity shall retain or cause to be retained all Tax Returns, schedules and work papers, 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 either Party reasonably requests, in writing, with respect to specific material records and documents. A Party (or Affiliate thereof) 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.  Either Party shall notify the other 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.

 

ARTICLE VII
 INDEMNIFICATION

 

Section 7.1                           Survival.  Except as otherwise contemplated by this Agreement, all covenants, agreements, indemnities, representations and warranties contained herein shall survive the Effective Time and shall remain in full force and effect thereafter.

 

Section 7.2                           Indemnification by Infrastructurco.  Infrastructurco shall indemnify and hold the Flowco Entities harmless from and against, without duplication, all Taxes for which Infrastructurco is responsible pursuant to Section 2.1(a), and any reasonable out-of-pocket costs or expenses related thereto (excluding any expenses governed by Section 3.10).

 

Section 7.3                           Indemnification by Flowco.  Flowco shall indemnify and hold the Infrastructurco Entities harmless from and against, without duplication, all Taxes for which Flowco is responsible pursuant to Section 2.1(b), and any reasonable out-of-pocket costs or expenses related thereto (excluding any expenses governed by Section 3.10).

 

Section 7.4                           Flowco Gross-Up Obligation.  If Flowco makes an indemnity or reimbursement payment to any Infrastructurco Entity attributable to any Flowco Prohibited Event, such indemnity or reimbursement payment shall be increased to take into account any Taxes of such Infrastructurco Entity resulting from the receipt of such indemnity or reimbursement payment.  For this purpose, the amount of such Taxes shall be determined

 

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assuming that such Infrastructurco Entity is taxed at the highest applicable marginal rate then in effect and has no Tax Attributes.

 

Section 7.5                           Characterization of Indemnification and Reimbursement Payments.  For all Tax purposes, Infrastructurco and Flowco agree to treat any indemnification or reimbursement or other similar payment made hereunder (other than any payment of interest accruing after the Distribution Date) as an adjustment to the amount of cash transferred between Infrastructurco and Flowco in the Flowco Asset Transfer.

 

ARTICLE VIII
 MISCELLANEOUS

 

Section 8.1                           Dispute Resolution.  In the event of any dispute between the Parties as to any matter covered by this Agreement that cannot be timely resolved through good faith negotiation:

 

(a)                                 if the amount in dispute is less than $10,000,000, the Parties shall appoint a nationally-recognized independent public accounting firm or law firm to resolve such dispute; and

 

(b)                                 if the amount in dispute equals or exceeds $10,000,000, the Parties shall appoint a panel of three nationally-recognized independent public accounting firms and/or law firms to resolve such dispute by majority decision, unless the Parties mutually agree instead to resolve such dispute (i) under Section 8.1(a), (ii) by using the dispute resolution procedures set forth in the Separation Agreement, or (iii) in some other way.

 

The Parties agree that the resolution of such dispute pursuant to this Section 8.1 shall be final and conclusive and binding on the Parties and that any fees and expenses related to the resolution of such dispute shall be borne by the non-prevailing Party.

 

Section 8.2                           Tax Sharing Agreements.  Any Tax sharing, indemnification or similar agreement between an Infrastructurco Entity and a Flowco Entity (other than any such agreement entered into in connection with the Transactions) shall be terminated as of no later than the Effective Time and, after the Effective Time, no Infrastructurco Entity or Flowco Entity shall have any further rights or obligations under any such Tax sharing, indemnification or similar agreement.

 

Section 8.3                           Specific Performance.  The Parties agree that irreparable damage would occur in the event that the provisions of this Agreement were not performed in accordance with their specific terms.  Accordingly, it is hereby agreed that the Parties shall be entitled to (i) an injunction or injunctions to enforce specifically the terms and provisions hereof, (ii) provisional or temporary injunctive relief in accordance therewith in any Delaware Court, and (iii) enforcement of any such award of an arbitral tribunal or a Delaware Court in any court of the United States, or any other any court or tribunal sitting in any state of the United States or in any foreign country that has jurisdiction, this being in addition to any other remedy or relief to which they may be entitled.

 

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Section 8.4                           Interest.  Any amount not paid when due pursuant to this Agreement shall bear interest at a rate per annum equal to the then effective Prime Rate plus 2% (or the maximum legal rate, whichever is lower), calculated for the actual number of days elapsed, accrued from the date on which such payment was due up to the date of the actual receipt of payment.

 

Section 8.5                           Coordination with the Separation Agreement and Other Ancillary Agreements.  This Agreement constitutes part of a more comprehensive agreement between the Parties, the other provisions of which are contained in the Separation Agreement and the other Ancillary Agreements.  Any general provision contained in the Separation Agreement (e.g., the provisions of Section 1.2 and ARTICLE X thereof) shall apply to this Agreement, mutatis mutandis, as though included herein, except to the extent the subject matter of such provision is expressly provided for herein.  In the event of any conflict between this Agreement and the Employee Matters Agreement regarding employee compensation or benefits matters, the Employee Matters Agreement shall control.

 

Section 8.6                           Effective Date.  This Agreement shall become effective only upon the occurrence of the Distribution.

 

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

 

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

 

 

	
SPX Corporation
    	
 
    
	
By
    	
 
    	
 
    
	
Name:
    	
 
    
	
Title: 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
SPX FLOW, Inc.
    	
 
    
	
By
    	
 
    	
 
    
	
Name:
    	
 
    
	
Title: 
    	
 
    

 

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