Separation and Distribution Agreement (2018)Full Document 

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SEPARATION AND DISTRIBUTION AGREEMENT

by and between

DOVER CORPORATION

and

APERGY CORPORATION

Dated as of May 9, 2018


TABLE OF CONTENTS

Page

Article I DEFINITIONS AND INTERPRETATION

2

Section 1.1

General 2

Section 1.2

References; Interpretation 20

Section 1.3

Effective Time 21

Section 1.4

Other Matters 21

Article II THE SEPARATION

21

Section 2.1

General 21

Section 2.2

Transfer of Assets 22

Section 2.3

Assumption and Satisfaction of Liabilities 22

Section 2.4

Intercompany Accounts 23

Section 2.5

Bank Accounts; Cash Balances 23

Section 2.6

Limitation of Liability; Termination of Intercompany Agreements 24

Section 2.7

Transfers Not Effected At or Prior to the Effective Time; Transfers Deemed Effective as of the Effective Time 25

Section 2.8

Transfer Documents 28

Section 2.9

Shared Contracts 28

Section 2.10

Further Assurances 29

Section 2.11

Novation of Liabilities; Consents 30

Section 2.12

Guarantees and Letters of Credit 31

Section 2.13

Disclaimer of Representations and Warranties 32

Section 2.14

Apergy Financing Arrangements 34

Article III CERTAIN ACTIONS PRIOR TO THE DISTRIBUTION

34

Section 3.1

Reorganization 34

Section 3.2

Certificate of Incorporation; Bylaws 34

Section 3.3

Directors and Officers 34

Section 3.4

Resignations 34

Section 3.5

Ancillary Agreements 35

Article IV THE DISTRIBUTION

35

Section 4.1

Stock Dividend to Dover; Distribution 35

Section 4.2

Fractional Shares 35

Section 4.3

Actions in Connection with the Distribution 36

Section 4.4

Sole Discretion of Dover 37

Section 4.5

Conditions to Distribution 37

Article V CERTAIN COVENANTS

39

Section 5.1

No Solicit 39

Section 5.2

Legal Names and Other Parties’ Trademark 39

Section 5.3

Auditors and Audits; Annual and Quarterly Financial Statements and Accounting 40

Section 5.4

No Restrictions on Corporate Opportunities 42

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Section 5.5

Patent Covenant Not to Sue 43

Article VI RELEASES AND INDEMNIFICATION

44

Section 6.1

Release of Pre-Distribution Claims 44

Section 6.2

Indemnification by Dover 46

Section 6.3

Indemnification by Apergy 46

Section 6.4

Procedures for Indemnification 46

Section 6.5

Indemnification Payments 50

Section 6.6

Additional Matters; Survival of Indemnities 50

Section 6.7

Indemnification Obligations Net of Insurance Proceeds and Other Amounts; Contribution 50

Section 6.8

Cooperation in Defense and Settlement 52

Section 6.9

Limitation of Liability 52

Section 6.10

Covenant not to Sue 52

Article VII CONFIDENTIALITY; ACCESS TO INFORMATION

52

Section 7.1

Preservation of Corporate Records 52

Section 7.2

Provision of Corporate Records 53

Section 7.3

Access to Information 53

Section 7.4

Witness Services 54

Section 7.5

Confidentiality 54

Section 7.6

Privileged Matters 56

Section 7.7

Ownership of Information 58

Section 7.8

Other Agreements 59

Section 7.9

Compensation for Providing Information 59

Article VIII DISPUTE RESOLUTION

59

Section 8.1

Negotiation 59

Section 8.2

Arbitration 60

Section 8.3

Selection of Arbitrators 60

Section 8.4

Arbitration Procedures 60

Section 8.5

Discovery 60

Section 8.6

Confidentiality of Proceedings 61

Section 8.7

Pre-Hearing Procedure and Disposition 61

Section 8.8

Continuity of Service and Performance 61

Section 8.9

Awards 61

Section 8.10

Costs 62

Section 8.11

Adherence to Time Limits 62

Article IX INSURANCE

62

Section 9.1

General Liability Policies to be Maintained by Apergy 62

Section 9.2

Policies and Allocation of Related Rights and Obligations 62

Section 9.3

Third Party Shared Policies 63

Section 9.4

Administration of Third Party Shared Policies; Other Matters 63

Section 9.5

Agreement for Waiver of Conflict and Shared Defense 65

Section 9.6

Cooperation 65

Section 9.7

Miscellaneous 65

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Article X MISCELLANEOUS

65

Section 10.1

Complete Agreement; Construction 65

Section 10.2

Ancillary Agreements 66

Section 10.3

Counterparts 66

Section 10.4

Survival of Agreements 66

Section 10.5

Expenses 66

Section 10.6

Notices 67

Section 10.7