EXHIBIT 10.1
LOANOUT AGREEMENT
This LOANOUT AGREEMENT is dated as of May 19, 1999 (the "Agreement"), by
and among Dynatech Corporation, a Massachusetts corporation (the "Company"),
Dynatech LLC, a Delaware limited liability company and wholly-owned subsidiary
of the Company (formerly known as Telecommunications Techniques Co., LLC)
("Holding"), and Clayton, Dubilier & Rice, Inc., a Delaware corporation
("CD&R").
WITNESSETH:
WHEREAS, Holding, the Company and CD&R are parties to a Consulting
Agreement, dated as of May 21, 1998 (the "Consulting Agreement"), among
Holding, the Company and CD&R, and an Indemnification Agreement, dated as of
May 21, 1998 (the "Indemnification Agreement"), among Holding, the Company,
CD&R and Clayton, Dubilier & Rice Fund V Limited Partnership, a Cayman Islands
exempted limited partnership;
WHEREAS, the Company and Holding desire to obtain the services of Mr. Ned
Lautenbach ("Lautenbach"), an employee of CD&R, to perform the functions of
Chairman, President and Chief Executive Officer of the Company and Holding,
and CD&R is willing to make such services available to the Company and Holding
upon and subject to the terms and conditions hereof; and
WHEREAS, this Agreement has been approved by the Boards of Directors of the
Company and Holding, including a majority of the disinterested directors of
each of the Company and Holding;
NOW, THEREFORE, in consideration of the foregoing premises and the
respective agreements hereinafter set forth and the mutual benefits to be
derived here from, the parties hereto hereby agree as follows:
1. Services, etc. CD&R shall make the services of Lautenbach available to
the Company and Holding, and the Company and Holding shall make use of the
services of Lautenbach to serve as Chairman, President and Chief Executive
Officer of each of the Company and Holding, commencing and effective as of May
19, 1999, until the expiration of the Term (as defined in Section 2 hereof).
Lautenbach shall be available to render such services on a part-time basis
mutually agreeable to the Company, Holding, CD&R and Lautenbach. Without
limiting the foregoing, Lautenbach will continue to serve as an employee of
CD&R and may serve as an officer or director of CD&R or other corporations or
entities and devote such time to performing such services as Lautenbach, in
his sole discretion, shall deem necessary or appropriate. The services of
Lautenbach to be made available to the Company, Holding and its subsidiaries
hereunder shall be deemed part of the services provided by CD&R pursuant to
the Consulting Agreement. No separate or additional consideration shall be
payable hereunder for the services of Lautenbach, beyond that payable under
the Consulting Agreement.
2. Term.
(a) This Agreement shall be effective as of May 19, 1999. The term of this
Agreement (the "Term") shall commence on May 19, 1999 and shall terminate on
the earliest to occur of (i) the termination of the Consulting Agreement, (ii)
the date that is ten (10) business days following delivery of written notice
of such termination by any party hereto to the other parties hereto, (iii) the
election of a successor President and Chief Executive Officer of the Company
or of Holding by the Board of Directors of the Company or of Holding, as
applicable, in accordance with its by-laws, and (iv) Lautenbach's death,
permanent disability or resignation from his employment with CD&R.
(b) The expiration of the Term shall not affect the continuing
effectiveness of the Consulting Agreement or the Indemnification Agreement,
each of which shall continue to be in full force and effect and enforceable in
accordance with their respective terms. Without limiting the foregoing, each
of the Company and Holding shall continue to, and shall be obligated to, pay
and reimburse all fees, expenses and other amounts as and when due under the
Consulting Agreement and the Indemnification Agreement and perform all their
other obligations thereunder.
3. Indemnification. All performance by, and all actions or omissions of,
CD&R or Lautenbach under or in respect of this Agreement shall be deemed to be
pursuant to the Consulting Agreement, and each of CD&R and Lautenbach shall be
entitled to the benefits of the indemnification and other provisions of the
Consulting Agreement and the Indemnification Agreement.
4. Independent Contractor Status. Each of CD&R, the Company and Holding
agree that the furnishing of Lautenbach's services hereunder by CD&R is solely
as an independent contractor, with CD&R retaining control over and
responsibility for its own operations and personnel, including Lautenbach.
Neither CD&R nor any of its directors, officers, employees or agents
(including Lautenbach) shall, solely by virtue of this Agreement or the
arrangements hereunder, be considered employees, principals, partners, co-
venturers or agents of the Company or Holding.
5. Notices. Any notice or other communication required or permitted to be
given or made under this Agreement by one party to the other parties shall be
in writing and shall be deemed to have been duly given and to be effective (i)
on the date of delivery if delivered personally or (ii) when sent if sent by
prepaid telegram, or mailed first-class, postage prepaid, by registered or
certified mail or confirmed facsimile transmission, as follows (or to such
other address as shall be given in writing by one party to the other parties
in accordance herewith):
If to the Company to:
Dynatech Corporation
3 New England Executive Park
Burlington, Massachusetts 01803
Attn: Secretary
Telephone: (781) 272-6100
Telecopy: (781) 272-2304
If to Holding, to it care of the Company at the address set forth above.
If to CD&R to:
Clayton, Dubilier & Rice, Inc.
375 Park Avenue, 18th Floor
New York, New York 10152
Attn: Joseph L. Rice, III
Telephone: (212) 407-5200
Telecopy: (212) 407-5252
With a copy to:
Debevoise & Plimpton
875 Third Avenue
New York, New York 10022
Attn: Franci J. Blassberg, Esq.
Telephone: (212) 909-6000
Telecopy: (212) 909-6836
6. General.
(a) Entire Agreement. This Agreement together with the Consulting Agreement
and the Indemnification Agreement (i) contain the complete and entire
understanding and agreement of CD&R, Holding and the Company with respect to
the subject matter hereof, and (ii) supersede all prior and contemporaneous
understandings, conditions and agreements, oral or written, express or
implied, in respect of the subject matter hereof, including but not limited to
in respect of the furnishing of the services of Lautenbach in connection with
the subject matter hereof. There are no representations or warranties of
Lautenbach or CD&R in connection with this Agreement or the services to be
made available hereunder, except as expressly made and contained in this
Agreement.
(b) Headings. The headings contained in this Agreement are for purposes of
convenience only and shall not affect the meaning or interpretation of this
Agreement.
(c) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of which shall
together constitute one and the same instrument.
(d) Binding Effect; Assignment. This Agreement shall be binding upon and
inure to the benefit of the parties to this Agreement and their respective
successors and assigns, provided that none of CD&R, the Company or Holding may
assign any of its rights or obligations under this Agreement without the
express written consent of the other parties hereto.
(e) Governing Law. THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE
UNDER, AND IS TO BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK WITHOUT REGARD TO ANY CONFLICTS LAWS THAT WOULD REQUIRE
THE APPLICATION OF THE LAW OF ANOTHER JURISDICTION. EACH OF THE COMPANY,
HOLDING AND CD&R HEREBY IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF
THE COURTS OF THE STATE OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED
STATES OF AMERICA LOCATED IN THE STATE, CITY AND COUNTY OF NEW YORK SOLELY IN
RESPECT OF THE INTERPRETATION AND ENFORCEMENT OF THE PROVISIONS OF THIS
AGREEMENT, AND THE PARTIES HERETO HEREBY IRREVOCABLY AGREE THAT (i) THE SOLE
AND EXCLUSIVE APPROPRIATE VENUE FOR ANY ACTION, SUIT OR PROCEEDING RELATING TO
SUCH INTERPRETATION AND ENFORCEMENT SHALL BE IN SUCH A COURT, (ii) ALL CLAIMS
WITH RESPECT TO SUCH PROVISIONS SHALL BE HEARD AND DETERMINED EXCLUSIVELY IN
SUCH A COURT, (iii) ANY SUCH COURT SHALL HAVE EXCLUSIVE JURISDICTION OVER THE
PERSON OF SUCH PARTIES AND OVER THE SUBJECT MATTER OF ANY DISPUTE RELATING TO
SUCH PROVISIONS AND (iv) EACH HEREBY WAIVES, AND AGREES NOT TO ASSERT, ANY AND
ALL OBJECTIONS AND DEFENSES BASED ON FORUM, VENUE OR PERSONAL OR SUBJECT
MATTER JURISDICTION AS THEY MAY RELATE TO SUCH AN ACTION, SUIT OR PROCEEDING
BEFORE SUCH A COURT IN ACCORDANCE WITH THE PROVISIONS OF THIS SECTION 6(e),
PROVIDED THAT ENFORCEMENT OF A JUDGMENT RENDERED BY SUCH A COURT MAY BE SOUGHT
IN ANY COURT OF COMPETENT JURISDICTION FOR THE ENFORCEMENT THEREOF. EACH OF
THE COMPANY, HOLDING AND CD&R HEREBY CONSENT TO AND GRANT ANY SUCH COURT
JURISDICTION OVER THE PERSON OF SUCH PARTIES AND OVER THE SUBJECT MATTER OF
ANY SUCH DISPUTE AND AGREE THAT MAILING OF PROCESS OR OTHER PAPERS IN
CONNECTION WITH ANY SUCH ACTION OR PROCEEDING IN THE MANNER PROVIDED IN
SECTION 5, OR IN SUCH OTHER MANNER AS MAY BE PERMITTED BY LAW, SHALL BE VALID
AND SUFFICIENT SERVICE THEREOF.
(f) Waiver of Jury Trial. Each party hereto acknowledges and agrees that
any controversy that may arise under this Agreement is likely to involve
complicated and difficult issues, and therefore it hereby irrevocably and
unconditionally waives any right it may have to a trial by jury in respect of
any litigation directly or indirectly arising out of or relating to this
Agreement, or the breach, termination or validity of this Agreement, or the
transactions contemplated by this Agreement. Each party certifies and
acknowledges that (i) no representative, agent or attorney of any other party
has represented, expressly or otherwise, that such other party would not, in
the event of litigation, seek to enforce the foregoing waiver, (ii) it
understands and has considered the implications of this waiver, (iii) it makes
this waiver voluntarily, and (iv) it has been induced to enter into this
Agreement by, among other things, the mutual waivers and certifications
contained in this Section 6(f).
(g) Amendment; Waivers. No amendment, modification, supplement or discharge
of this Agreement, and no waiver hereunder, shall be valid or binding unless
set forth in writing and duly executed by the party against whom enforcement
of the amendment, modification, supplement, discharge or waiver is sought (and
in the case of Holding and the Company, approved by resolution of the Board of
Directors of Holding or the Company, as the case may be). Any such waiver
shall constitute a waiver only with respect to the specific matter described
in such writing and shall in no way impair the rights of the party granting
such waiver in any other respect or at any other time. Neither the waiver by
any party hereto of a breach of or a default under any of the provisions of
this Agreement, nor the failure by any party, on one or more occasions, to
enforce any of the provisions of this Agreement or to exercise any right or
privilege hereunder, shall be construed as a waiver of any other breach or
default of a similar nature, or as a waiver of any of such provisions, rights
or privileges hereunder. The rights and remedies herein provided are
cumulative and are not exclusive of any rights or remedies that any party may
otherwise have at law or in equity or otherwise.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
date first above written.
Dynatech Corporation
/s/ Mark V. B. Tremallo
By: ___________________________________
Name:Mark V. B. Tremallo
Title: Corporate Vice President and
General Counsel
Dynatech LLC
/s/ Mark V. B. Tremallo
By: ___________________________________
Name:Mark V. B. Tremallo
Title: Corporate Vice President and
General Counsel
Clayton, Dubilier & Rice, Inc.
/s/ William A. Barbe
By: ___________________________________
Name:William A. Barbe
Title: Vice President, Secretary
and Treasurer