Free Answering Brief in Opposition - District Court of Delaware - Delaware

Case 1:04-cv—01294-JJF Document 81-4 Filed 04/18/2006 Page1 013
EXHIBIT B

Case 1 :04-cv—01294-JJF Document 81 -4 Filed 04/18/2006 Page 2 of 3 »
f\ ,
FLQWSERVE
v .-
August 18, 2003 _ 1
Edward B. Mueller, Esq.
Nisen & Elliott, LLC
. 200 W. Adams Street, Suite 2500
Chicago, Illinois 60606 I `
Re: Asbestos Litigation — BW/IP International, Inc.
Flowserve File No. R8307
Dear Ed: _
Pursuant to our recent conversations, this correspondence will respond to the -
various Reservation of Rights letters you have forwarded on behalf of Btuns Intemational
(f/k/a Borg-Warner Corporation).
I Although F lowserve certainly agrees that the language of the 1987 Stock Purchase . V
Agreement between BWIP Acquisition Corporation and Borg-Warner Corporation could g
have been a bit more concise, we strongly disagree with any interpretation limiting
Flowserve’s access to the historic Borg-Warner insurance coverage for asbestos liability.
Flowserve’s position has previously been discussed with you, and we would offer
the enclosed May l, 1987 communication as support forour position. This "letter" was
executed by both parties prior to the closing of the LBO, became part of the transaction
docrunents, and specifically clarified this issue. It states as follows:
"The purpose of this letter is to document our mutual agreement that,
notwithstanding anything to the contrary contained in the Agreement, neither BWIP
nor any of its Subsidiaries shall be responsible for any Loses to the extent that such
Loses are covered by insurance carried by Borg-Warner."
It is my understanding that you have not previously been provided with a copy of
this document. After you have had a chance to review it, please advise of your position. ··
_ Sincerely,
Robert L. Roberts, Jr. (Ohio Atty. 0006080)
Associate General Counsel
cc: Lawrence E. Henke, Esq, Flowserve Corporation
Document No. R08l803F2 BIOOO441
Flowserve Corporation 222 West Las Colinas Blvd., Suite 1500 Telephone @2-443-6537
Irving, Texas 75039 USA Facsimile 972 443-5837
rroherts@fIovvsen:e.i3om _

08/12/2003Oase111t`B11-tl/2O9I<295.8J5F DocLDrEErYt$8%II·2-4% PLHIl§UN)4/18/2006 Page3of3@¤02
'
‘. '
_} · . yj.
..7 GI I ·§I·`
. [ BWIP ACQUISITION CORPORATION _ I
c/o-The Clayton Oubilier n _
1* _ ~’ Private Equity Fund II Limited Partnership
270 Greenwich Avenue
-. Greenwich, Connecticut - 5
··,` . -
.§ =`* * *
··Z€ May 1, 1957 ‘
T A ·1..*¤*= :1*
-·: ·F' {
ae .
_` ;·g·\·1arne·}:_ Corporation
F '¢§’§?D,?. ·00 South Michigan Avenue
'- {G25?} ‘ ' '
'- Lcago Illinois 60604
M ci-:. I s .
-2* : »‘$ér?$‘ e·¤<.·
J: .·xZ§£ . · .,¤ ' *···§=‘?' ·i""
, $#11
»“"*“fj§,_,_ Stock Purchase Agreement
:»j&§z·,
.2 . mi;. _
.6¤•ar Sirs:
Reference is made to the Stock Purchase Agreement
E jwzhe "Agreement"), dated March 12, 1987, by and between
HIP Acquisition Corporation_ and Borg-Warner Corporation.
`EF §};Capitalized terms used herein without definition shall have
meanings assigned to them in the Agreement.
The purpose of this letter is to document our
itmutual agreement that, notwithstanding anything to the »
Tillcontrary contained ih the Agreementhneither BWIP nor any
fiiof its _Subsidiaries shall be responsible for any Losses
§_ {to the extent that such Loss-es are covered by insurance
_ · §?`cnrried by Borg-Warner. · _ ·;
· F15? . .
_ Accordingly, as provided by Section 9.0£+(a) of
fg? the Agreement, Borg-Warner will indemnify the_Buyer, BWIP
éiinnd each of their respective subsidiaries against all Losses
the extent such Losses are covered by such insurance.

In order to evidence your agreement to the _
,_ foregoing, please sign and return the enclosed copy of this
letter.
Very truly yours,
,;- BWI? ACQUIS ON
CORPORA N


BY J
P' e i ent
Accepted and Agreed:
-·=ii§
V •§};,
’ BOR -w RPORAIION
;». G ARNER CO BIO00442
‘ ..L' ‘H
at 6
By AQM Q Jzzezcmié
° _¤· Vice-Pres:. nt
{I
I Atlliri 17 Umm? 1::·1‘2 *111 mama :¤'?¢: mnnr: 0*1