Exhibit 10.29
JOINT DEFENSE
AGREEMENT
THIS JOINT DEFENSE
AGREEMENT (“Joint
Defense Agreement”) is entered into as of this 19th day of
January 2005, by and among The Rugby Group Ltd., f/k/a The Rugby
Group PLC, an English company (“Rugby”), Rugby IPD
Corp., a Delaware corporation (“Rugby IPD”), and Huttig
Building Products, Inc., a Delaware corporation
(“Huttig”) (Rugby, Rugby IPD and Huttig being referred
to herein separately as a “Party” and collectively as
the “Parties”).
WITNESSETH:
WHEREAS , Rugby Building Products (as defined herein)
transferred to Rugby IPD, on December 10, 1999, certain assets
pursuant and subject to the terms of the Exchange Agreement (as
defined herein); and
WHEREAS , Rugby contributed to Huttig, on the Closing
Date (as defined herein), all of the outstanding common shares of
Rugby’s then wholly-owned subsidiary, Rugby USA (as defined
herein), pursuant and subject to the terms of the Share Exchange
Agreement (as defined herein); and
WHEREAS , Huttig has contended that Rugby and Rugby IPD
are required to defend, indemnify and hold harmless Huttig from and
against the Stanline Asbestos Claims (as defined herein) pursuant
to the Share Exchange Agreement and the Exchange Agreement,
respectively; and
* Material has been omitted pursuant to a request
for confidential treatment. The omitted material has been filed
separately with the Securities and Exchange Commission.
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Exhibit 10.29
WHEREAS , Rugby and Rugby IPD have denied that they have
any liability to defend, indemnify and hold harmless Huttig from
and against the Stanline Asbestos Claims; and
WHEREAS , Huttig has filed the Pending Litigation (as
defined herein) to determine whether Rugby and Rugby IPD have an
obligation to defend, indemnify and hold harmless Huttig from and
against the Stanline Asbestos Claims; and
WHEREAS , the Parties desire to settle and resolve their
disputes regarding the Stanline Asbestos Claims by executing the
Settlement Agreement (as defined herein) and this Joint Defense
Agreement; and
WHEREAS , the Parties share a mutuality of interest in
connection with the defense of the Future Stanline Asbestos Claims
(as defined herein) and agree that it is in their best interest to
cooperate in efforts to defend the Future Stanline Asbestos Claims;
and
WHEREAS , the Parties recognize that the common
interests of the Parties are best served by exchanging information;
and
WHEREAS , even upon such exchange, such information is
privileged from disclosure to adverse or other third parties as a
result of the attorney-client privilege, the attorney work product
doctrine, the work product doctrine, the joint defense privilege,
the common interest doctrine and/or other privileges or immunities
with respect to disclosure to third parties; and
* Material has been omitted pursuant to a request
for confidential treatment. The omitted material has been filed
separately with the Securities and Exchange Commission.
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Exhibit 10.29
WHEREAS , the Parties desire to further their common
interests by establishing procedures for cooperation and the
exchange and sharing of information between and among themselves;
and
WHEREAS , it is the purpose of this Joint Defense
Agreement to, inter alia , (i) protect the confidential and
privileged nature of all exchanged information and (ii) ensure that
the exchange and disclosure of information contemplated herein does
not diminish in any way the confidentiality of the information and
does not constitute a waiver of any privilege or
protection;
NOW, THEREFORE
, in consideration of the mutual
promises contained herein and other valuable consideration, the
adequacy and sufficiency of which are hereby acknowledged, the
Parties hereby covenant and agree as follows:
1. Definitions
The following terms shall have the
following meanings for purposes of this Joint Defense
Agreement:
(a) “Claim” shall mean
all claims, rights, duties, obligations, demands, actions, causes
of action, suits, debts, liabilities and losses of any kind
whatsoever and expressly includes all Defense Costs incident
thereto.
(b) “Closing Date” shall
mean December 16, 1999, which was the date of the closing of the
transactions contemplated by the Share Exchange
Agreement.
* Material has been omitted pursuant to a request
for confidential treatment. The omitted material has been filed
separately with the Securities and Exchange Commission.
3
Exhibit 10.29
(c) “Court” shall mean
the Supreme Court of the State of New York, County of New
York.
(d) “Crane” shall mean
Crane Co., a corporation organized and existing under the laws of
Delaware with its principal place of business in
Connecticut.
(e) “Defense Costs”
shall include all amoun ts reasonably incurred and paid in the
defense, compromise or satisfaction of a Claim, including those
resulting from (i) the fees and the customary costs of attorneys,
investigators, consultants, experts and court reporters, but
excluding internal costs such as employees’ salaries and/or
(ii) a judgment or a settlement.
(f) “Defense Counsel”
shall mean counsel selected by Huttig to defend any Claim subject
to this Joint Defense Agreement.
(g) “Exchange Agreement”
shall mean the Exchange Agreement between Rugby Building Products
and Rugby IPD dated as of December 10, 1999.
(h) “Future Stanline Asbestos
Claims” shall mean all Stanline Asbestos Claims, if any, that
may be asserted after the Settlement Date.
(i) “Huttig” shall have
the meaning set forth in the first paragraph of this Joint Defense
Agreement.
(j) “Joint Defense
Account” shall mean the account established and maintained
pursuant to, and in accordance with, Section 2 of this Joint
Defense Agreement.
* Material has been omitted pursuant to a request
for confidential treatment. The omitted material has been filed
separately with the Securities and Exchange Commission.
4
Exhibit 10.29
(k) “Joint Defense
Agreement” shall have the meaning set forth in the first
paragraph of this Joint Defense Agreement.
(l) “Joint Defense
Materials” shall mean the confidential information relating
to the defense of the Future Stanline Asbestos Claims described in
Section 7 of this Joint Defense Agreement.
(m) “Joint Defense Fund”
shall mean the money contributed by Rugby and Huttig to the Joint
Defense Account, pursuant to, and in accordance with Section 2 of
this Joint Defense Agreement.
(n) “*Cap” shall mean
the cap amounting to a cumulative total contribution to the Joint
Defense Fund of * applicable to each of Rugby and Huttig equally,
excluding interest earned on any contributions.
(o) “Parties” shall have
the meaning set forth in the first paragraph of this Joint Defense
Agreement.
(p) “Pending Litigation”
shall mean the litigation pending in the Court styled Huttig
Building Products, Inc. v. The Rugby Group Ltd., f/k/a The Rugby
Group P.L.C. and Rugby IPD Corp., Index No.: 601515/02.
(q) “Renewed Litigation”
shall mean the renewed litigation that may be commenced by any of
the Parties pursuant to Section 6 of the Settlement
Agreement.
* Material has been omitted pursuant to a request
for confidential treatment. The omitted material has been filed
separately with the Securities and Exchange Commission.
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Exhibit 10.29
(r) “Rugby” shall have
the meaning set forth in the first paragraph of this Joint Defense
Agreement.
(s) “Rugby Building
Products” shall mean Rugby Building Products, Inc., which, as
of the Closing Date, was a subsidiary of Rugby USA and was a
corporation organized under the laws of Delaware with its principal
place of business in Georgia.
(t) “Rugby IPD” shall
have the meaning set forth in the first paragraph of this Joint
Defense Agreement.
(u) “Rugby USA” shall
mean Rugby USA, Inc., a corporation that, as of the Closing Date,
was organized under the laws of the state of Georgia with its
principal place of business in Georgia.
(v) “Settlement
Agreement” shall mean the Settlement Agreement among the
Parties executed simultaneously with this Joint Defense
Agreement.
(w) “Settlement Date”
shall mean the date first written above.
(x) “Share Exchange
Agreement” shall mean the Share Exchange Agreement among
Rugby, Crane and Huttig dated October 19, 1999.
(y) “Stanline” shall
mean Stanline, Inc., which, from approximately 1961 until
approximately 1994, was a California corporation.
(z) “Stanline Asbestos
Claims” shall mean all Claims by any person for personal
injury or damages to property (i) alleged by any such person to
be
* Material has been omitted pursuant to a request
for confidential treatment. The omitted material has been filed
separately with the Securities and Exchange Commission.
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Exhibit 10.29
attributable to Stanline’s manufacture,
distribution or sale of a product allegedly containing asbestos and
(ii) asserted, directly or indirectly, against any of the Parties
or any of their present or past subsidiary, predecessor or
successor companies (including, without limitation, Stanline, Rugby
Building Products and Rugby USA).
2. Joint Defense Fund
(a) On or before the Settlement
Date, Huttig shall open the Joint Defense Account, which shall be a
segregated, interest-bearing account at a U.S. bank selected by
Huttig and shall be established and maintained for the joint
interest of Rugby and Huttig for the sole purpose of depositing,
holding and disbursing the Joint Defense Fund subject to, and in
accordance with, the terms of this Joint Defense Agreement. Huttig
shall have sole signatory authority over the Joint Defense Account,
which authority it shall exercise subject to, and in accordance
with, this Joint Defense Agreement, and both Huttig and Rugby shall
receive the monthly statements for the Joint Defense
Account.
(b) In no event shall Rugby or
Huttig be required to make any contribution to the Joint Defense
Fund that would exceed the *Cap, except as otherwise provided in
Section 5 below or unless this Settlement Agreement is modified in
accordance with Section 28 hereof.
* Material has been omitted pursuant to a request
for confidential treatment. The omitted material has been filed
separately with the Securities and Exchange Commission.
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Exhibit 10.29
(c) On the Settlement Date, Rugby
and Huttig shall each make an initial contribution of the sum of *
to the Joint Defense Account to establish the initial balance of
the Joint Defense Fund.
(d) If, at any time, the balance of
the Joint Defense Fund drops below the sum of * or is insufficient
to pay any Defense Costs that are due, Rugby and Huttig shall
thereafter each make additional equal contributions to the Joint
Defense Account to increase the balance of the Joint Defense Fund,
as required, up to the sum of * or to any sum in excess of * that
is required to pay any Defense Costs that are due, subject to the *
Cap. If additional contributions are required to be made to the
Joint Defense Account to increase the balance of the Joint Defense
Fund, both Rugby and Huttig agree to make such contributions within
ten (10) business days of receipt of written notice from Huttig to
Rugby that the balance of the Joint Defense Fund has dropped below
the sum of * or is insufficient to pay Defense Costs that are due,
subject to the * Cap.
3. Claims Subject to Joint Defense
Agreement
This Joint Defense Agreement shall
apply to all Future Stanline Asbestos Claims only and no other
Claims, unless this Joint Defense Agreement is modified in
accordance with Section 28 hereof, subject to the following, and in
all events subject to Section 2(b) above:
* (3 pages omitted)
* Material has been omitted pursuant to a request
for confidential treatment. The omitted material has been filed
separately with the Securities and Exchange Commission.
8
Exhibit 10.29
4. Payment of Defense
Costs
The Joint Defense Fund shall pay all
Defense Costs incurred for any Future Stanline Asbestos Claim in
the following manner:
(a) The Joint Defense Fund shall be
charged only with Defense Costs incurred in defending Future
Stanline Asbestos Claims and not in connection with any other
matter including, without limitation, defending or advising Huttig
with respect to any issues that may arise between Huttig and Rugby
under the Settlement Agreement and/or this Joint Defense
Agreement.
(b) Huttig shall submit invoices for
any Defense Costs incurred for any Future Stanline Asbestos Claim
subject to this Joint Defense Agreement to Rugby. Such invoices
shall include sufficient detail for Rugby to determine whether the
Defense Costs are properly payable, and Huttig shall provide Rugby
with any additional information that Rugby may reasonably request
in order to make such determination.
(c) If no objection to an invoice is
received by Huttig from Rugby within ten (10) business days after
Huttig’s submission of the invoice, then Huttig shall pay the
invoice thereafter from the Joint Defense Fund.
(d) If an objection to an invoice or
a portion of an invoice is received by Huttig from Rugby within ten
(10) business days after Huttig’s submission of the invoice
to Rugby, then Huttig shall not pay the amount of the objected to
portion
* Material has been omitted pursuant to a request
for confidential treatment. The omitted material has been filed
separately with the Securities and Exchange Commission.
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Exhibit 10.29
of the invoice from the Joint Defense Fund until
it receives written instructions from Rugby, or an arbitration
award issued pursuant to Section 24 hereof determines that some or
all of the objected portion of the invoice should be paid. If such
objection is not resolved by the Parties within thirty (30) days of
the date of the objection, then Rugby shall commence arbitration
pursuant to Section 24 within forty (40) days of the date of the
objection unless the Parties agree in writing to extend the time
for Rugby to commence the arbitration. If Rugby fails to commence
the arbitration within forty (40) days of the date of the objection
and the Parties do not agree in writing to extend the time for
Rugby to commence the arbitration, then Rugby will be deemed to
have waived its objection to the invoice and Huttig shall pay the
invoice thereafter from the Joint Defense Fund.
5. Control of Defense
The Parties agree that Huttig shall
have responsibility for the defense of any Future Stanline Asbestos
Claims subject to this Joint Defense Agreement, including the right
to choose Defense Counsel and to direct the day-to-day defense of
any such Claims, subject to and in accordance with the
following:
(a) Any Defense Counsel engaged to
defend Future Stanline Asbestos Claims under this Joint Defense
Agreement will have an attorney-client relationship with Huttig but
not with Rugby or Rugby IPD.
* Material has been omitted pursuant to a request
for confidential treatment. The omitted material has been filed
separately with the Securities and Exchange Commission.
10
Exhibit 10.29
(b) Rugby and/or Rugby IPD may
engage counsel to act on their behalf and at their expense in
connection with any Future Stanline Asbestos Claim.
(c) Huttig shall provide Rugby with
written notice of any Claim asserted against Huttig in the future
that Huttig believes is or may be a Future Stanline Asbestos Claim
subject to this Joint Defense Agreement. Defense Counsel shall
provide Huttig and Rugby, or their respective counsel, with
information or documents regarding any such Future Stanline
Asbestos Claim as may be reasonably requested.
(d) Huttig may settle any Future
Stanline Asbestos Claim in any amount Huttig reasonably believes to
be appropriate. However, Rugby shall not be responsible for the
payment of its share of the amount of any settlement or judgment,
which, when aggregated with Rugby’s share of other Defense
Costs, would exceed the * Cap, unless Rugby expressly consents
thereto. In the event that Huttig requests that Rugby pay any such
amount that would exceed the * Cap, Rugby may, at its option: (i)
consent to such settlement or judgment, in which event the entire
amount of the settlement or judgment shall be charged to and paid
by the Joint Defe
