EX-10.1 3 d337397dex101.htm EX-10.1 EXECUTION VERSION TRANSITION SERVICES AGREEMENT BY AND BETWEEN VARIAN MEDICAL SYSTEMS, INC. AND VAREX IMAGING CORPORATION DATED AS OF JANUARY 27, 2017 Page
Exhibit 10.1
EXECUTION VERSION
BY AND BETWEEN
VARIAN MEDICAL SYSTEMS, INC.
AND
VAREX IMAGING CORPORATION
DATED AS OF JANUARY 27, 2017
TABLE OF CONTENTS
Page | ||||||||
ARTICLE I DEFINITIONS | 1 | |||||||
Section 1.01. | Definitions | 1 | ||||||
ARTICLE II SERVICES | 5 | |||||||
Section 2.01. | Services | 5 | ||||||
Section 2.02. | Performance of Services | 6 | ||||||
Section 2.03. | Charges for Services | 7 | ||||||
Section 2.04. | Reimbursement for Out-of-Pocket Costs and Expenses | 8 | ||||||
Section 2.05. | Changes in the Performance of Services | 8 | ||||||
Section 2.06. | Transitional Nature of Services | 8 | ||||||
Section 2.07. | Subcontracting | 8 | ||||||
ARTICLE III OTHER ARRANGEMENTS | 9 | |||||||
Section 3.01. | Access | 9 | ||||||
ARTICLE IV BILLING; TAXES | 10 | |||||||
Section 4.01. | Procedure | 10 | ||||||
Section 4.02. | Late Payments | 10 | ||||||
Section 4.03. | Taxes | 10 | ||||||
Section 4.04. | No Set-Off | 11 | ||||||
Section 4.05. | Audit Rights | 11 | ||||||
ARTICLE V TERM AND TERMINATION | 11 | |||||||
Section 5.01. | Term | 11 | ||||||
Section 5.02. | Early Termination | 12 | ||||||
Section 5.03. | Interdependencies | 13 | ||||||
Section 5.04. | Effect of Termination | 13 | ||||||
Section 5.05. | Information Transmission | 13 | ||||||
ARTICLE VI CONFIDENTIALITY; PROTECTIVE ARRANGEMENTS | 14 | |||||||
Section 6.01. | Parent and SpinCo Obligations | 14 | ||||||
Section 6.02. | No Release; Return or Destruction | 14 | ||||||
Section 6.03. | Privacy and Data Protection Laws | 14 | ||||||
Section 6.04. | Protective Arrangements | 14 | ||||||
ARTICLE VII LIMITED LIABILITY AND INDEMNIFICATION | 15 | |||||||
Section 7.01. | Limitations on Liability | 00 |
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Xxxxxxx 7.02. | Obligation to Re-Perform; Liabilities | 16 | ||||||
Section 7.03. | Third-Party Claims | 16 | ||||||
Section 7.04. | Provider Indemnity | 16 | ||||||
Section 7.05. | Indemnification Procedures | 16 | ||||||
ARTICLE VIII MISCELLANEOUS | 17 | |||||||
Section 8.01. | Mutual Cooperation | 17 | ||||||
Section 8.02. | Further Assurances | 17 | ||||||
Section 8.03. | Audit Assistance | 17 | ||||||
Section 8.04. | Title to Intellectual Property | 17 | ||||||
Section 8.05. | Independent Contractors | 17 | ||||||
Section 8.06. | Counterparts; Entire Agreement; Corporate Power | 18 | ||||||
Section 8.07. | Governing Law | 19 | ||||||
Section 8.08. | Assignability | 19 | ||||||
Section 8.09. | Third-Party Beneficiaries | 19 | ||||||
Section 8.10. | Notices | 19 | ||||||
Section 8.11. | Severability | 20 | ||||||
Section 8.12. | Force Majeure | 20 | ||||||
Section 8.13. | Headings | 20 | ||||||
Section 8.14. | Survival of Covenants | 20 | ||||||
Section 8.15. | Waivers of Default | 21 | ||||||
Section 8.16. | Dispute Resolution | 21 | ||||||
Section 8.17. | Specific Performance | 21 | ||||||
Section 8.18. | Amendments | 22 | ||||||
Section 8.19. | Precedence of Schedules | 22 | ||||||
Section 8.20. | Interpretation | 22 | ||||||
Section 8.21. | Mutual Drafting | 22 |
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This TRANSITION SERVICES AGREEMENT, dated as of January 27, 2017 (this “Agreement”), is by and between Varian Medical Systems, Inc., a Delaware corporation (“Parent”), and Varex Imaging Corporation, a Delaware corporation (“SpinCo”).
Article I.
“Action” has the meaning set forth in the Separation and Distribution Agreement.
“Additional Services” shall have the meaning set forth in Section 2.01(b).
“Affiliate” has the meaning set forth in the Separation and Distribution Agreement.
“Agreement” has the meaning set forth in the Preamble.
“Ancillary Agreements” has the meaning set forth in the Separation and Distribution Agreement.
“Charge” and “Charges” have the meaning set forth in Section 2.03.
“Confidential Information” means all Information that is either confidential or proprietary.
“Dispute” has the meaning set forth in Section 8.16(a).
“Distribution” has the meaning set forth in the Recitals.
“Distribution Date” has the meaning set forth in the Separation and Distribution Agreement.
“Effective Time” has the meaning set forth in the Separation and Distribution Agreement.
“Expanded Services” has the meaning set forth in Section 2.01(b).
“Force Majeure” has the meaning set forth in the Separation and Distribution Agreement.
“Governmental Authority” has the meaning set forth in the Separation and Distribution Agreement.
“Information” means information, whether or not patentable or copyrightable, in written, oral, electronic or other tangible or intangible forms, stored in any medium, including studies, reports, records, books, contracts, instruments, surveys, discoveries, ideas, concepts, know-how, techniques, designs, specifications, drawings, blueprints, diagrams, models, prototypes, samples, flow charts, data, computer data, disks, diskettes, tapes, computer programs or other software, marketing plans, customer names, communications by or to attorneys (including attorney-client privileged communications), memos and other materials prepared by attorneys or under their direction (including attorney work product), and other technical, financial, employee or business information or data.
“Intellectual Property Matters Agreement” has the meaning set forth in the Separation and Distribution Agreement.
“Interest Payment” has the meaning set forth in Section 4.02.
“Law” has the meaning set forth in the Separation and Distribution Agreement.
“Level of Service” has the meaning set forth in Section 2.02(c).
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“Liabilities” has the meaning set forth in the Separation and Distribution Agreement.
“Losses” has the meaning set forth in the Separation and Distribution Agreement.
“Minimum Service Period” means the period commencing on the Distribution Date and ending thirty (30) days after the Distribution Date, unless otherwise specified with respect to a particular service on the Schedules hereto.
“Parent” has the meaning set forth in the Preamble.
“Parent Board” has the meaning set forth in the Recitals.
“Parent Business” has the meaning set forth in the Separation and Distribution Agreement.
“Parent Shares” means the shares of common stock, par value $1.00 per share, of Parent.
“Parties” and “Party” means the parties to this Agreement.
“Person” has the meaning set forth in the Separation and Distribution Agreement.
“Prime Rate” has the meaning set forth in the Separation and Distribution Agreement.
“Provider” means, with respect to any Service, the Party providing such Service hereunder.
“Provider Indemnitees” has the meaning set forth in Section 7.03.
“Recipient” means, with respect to any Service, the Party receiving such Service hereunder.
“Recipient Indemnitees” has the meaning set forth in Section 7.04.
“Record Date” has the meaning set forth in the Separation and Distribution Agreement.
“Representatives” means, with respect to any Person, any of such Person’s directors, officers, employees, agents, consultants, advisors, accountants, attorneys or other representatives.
“Separation” has the meaning set forth in the Recitals.
“Separation and Distribution Agreement” has the meaning set forth in the Recitals.
“Service Baseline Period” has the meaning set forth in Section 2.02(c).
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“Service Extension” has the meaning set forth in Section 5.01(b).
“Service Period” means, with respect to any Service, the period commencing on the Distribution Date (or such other date following the Distribution Date as specified in the Schedules hereto) and ending on the earliest of (a) the date that a Party terminates the provision of such Service pursuant to Section 5.02, (b) the date that is the two year anniversary of the Distribution Date and (c) the date specified for termination of such Service in the Schedules hereto.
“Services” has the meaning set forth in Section 2.01(a).
“SpinCo” has the meaning set forth in the Preamble.
“SpinCo Business” has the meaning ascribed to the term “Varex Business” in the Separation and Distribution Agreement.
“SpinCo Shares” means the shares of common stock, par value $0.01 per share, of SpinCo.
“Subsidiary” has the meaning set forth in the Separation and Distribution Agreement.
“Tax” shall have the meaning set forth in the Tax Matters Agreement.
“Tax Authority” shall have the meaning set forth in the Tax Matters Agreement.
“Tax Matters Agreement” means the Tax Matters Agreement to be entered into by and between Parent and SpinCo in connection with the Separation, the Distribution or the other transactions contemplated by the Separation and Distribution Agreement.
“Termination Charges” means, with respect to the termination of any Service pursuant to Section 5.02(a)(i), any and all costs, fees and expenses (other than any severance or retention costs, unless otherwise specified with respect to a particular Service on the Schedules hereto or in the other Ancillary Agreements) payable by the Provider of such Service to a Third Party directly as a result of the early termination of such Service; provided, however, that the Provider shall use commercially reasonable efforts to minimize any costs, fees or expenses payable to any Third Party in connection with such early termination of such Service and credit any such reductions against the Termination Charges payable by the Recipient.
“Third Party” means any Person other than the Parties or any of their respective Affiliates.
“Third-Party Claim” means any Action commenced by any Third Party against any Party or any of its Affiliates.
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Article II.
(a) | Commencing as of the Effective Time, the Provider agrees to provide, or to cause one or more of its Subsidiaries to provide, to the Recipient, or any Subsidiary of the Recipient, the applicable services (the “Services”) set forth on the Schedules hereto. |
(b) | After the date of this Agreement, if SpinCo or Parent (i) identifies a service that (x) the Parent or any of its Subsidiaries provided to SpinCo prior to the Distribution Date that SpinCo reasonably needs in order for the SpinCo Business to continue to operate in substantially the same manner in which the SpinCo Business operated prior to the Distribution Date (for the avoidance of doubt, without giving effect to any post-Distribution Date acquisitions by SpinCo), and either such service was not included on the Schedules hereto (other than because the Parties agreed such service shall not be provided) or the scope of such service that is included on the Schedules hereto needs to be expanded (other than because the Parties agreed that such scope would not be provided), or (y) SpinCo or any of its Subsidiaries provided to Parent prior to the Distribution Date that Parent reasonably needs in order for the Parent Business to continue to operate in substantially the same manner in which the Parent Business operated prior to the Distribution Date (for the avoidance of doubt, without giving effect to any post-Distribution Date acquisitions by Parent), and either such service was not included on the Schedules hereto (other than because the Parties agreed such service shall not be provided) or the scope of such service that is included on the Schedules hereto needs to be expanded (other than because the Parties agreed that such scope would not be provided), and (ii) provides written notice to the other Party within one hundred twenty (120) days after the Distribution Date requesting such additional services, then such other Party shall use its commercially reasonable efforts to provide, or to cause one of its Subsidiaries to provide, such requested additional services (such requested additional services, the “Additional Services” and such requested expanded services, the “Expanded Services”); provided, however, that no Party shall be obligated to provide any Additional Service or Expanded Service if it does not, in its reasonable judgment, have adequate resources to provide such Additional Service or Expanded Service or if the provision of such Additional Service or Expanded Service would significantly disrupt the operation of its or its Subsidiaries’ businesses (including, for the avoidance of doubt, disruptions or potential disruptions to information technology security); and provided, further, that the Provider shall not be required to provide any Additional Services or Expanded Services if the Parties are unable to reach agreement on the terms thereof (including with respect to Charges therefor). In connection with any request for Additional Services or Expanded Services in accordance with this Section 2.01(b), the Parties shall in good faith negotiate the terms of a supplement to the applicable Schedule, which terms shall be consistent with the terms of, and the pricing methodology used for, similar Services provided under this Agreement. Upon the mutual written agreement of the Parties, the supplement to the applicable Schedule shall describe in reasonable detail the nature, scope, service period(s), termination provisions and other terms applicable to such Additional Services in a manner similar to that in which the Services are described in the existing Schedules. |
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Each supplement to the applicable Schedule, as agreed to in writing by the Parties, shall be deemed part of this Agreement as of the date of such agreement and the Additional Services set forth therein shall be deemed “Services” provided under this Agreement, in each case subject to the terms and conditions of this Agreement. |
Section 2.02 Performance of Services.
(a) | Subject to Section 2.05, the Provider shall perform, or shall cause one or more of its Subsidiaries to perform, all Services to be provided by the Provider in a manner that is based on its past practice and that is substantially similar in all material respects to the analogous services provided by or on behalf of Parent or any of its Subsidiaries to Parent or its applicable functional group or Subsidiary prior to the Effective Time, and, in any event, in a manner that conforms in all material respects with the terms of the Schedules hereto. |
(b) | Nothing in this Agreement shall require the Provider to perform or cause to be performed any Service to the extent that the manner of such performance would constitute a violation of any applicable Law or any existing contract or agreement with a Third Party. If the Provider is or becomes aware of the potential for any such violation, the Provider shall promptly advise the Recipient of such potential violation, and the Provider and the Recipient will mutually seek an alternative that addresses such potential violation. The Parties agree to cooperate in good faith and use commercially reasonable efforts to obtain any necessary Third Party consents required under any existing contract or agreement with a Third Party to allow the Provider to perform, or cause to be performed, all Services to be provided by the Provider hereunder in accordance with the standards set forth in this Section 2.02. Unless otherwise agreed in writing by the Parties, all reasonable out-of-pocket costs and expenses (if any) incurred by any Party or any of its Subsidiaries in connection with obtaining any such Third Party consent that is required to allow the Provider to perform or cause to be performed such Services shall be divided proportionately between the Provider and the Recipient in accordance with such Parties’ respective utilization of such Services at such time. If, with respect to a Service, the Parties, despite the use of such commercially reasonable efforts, are unable to obtain a required Third Party consent, or the performance of such Service by the Provider would constitute a violation of any applicable Law, the Provider shall have no obligation whatsoever to perform such Service or cause such Service to be performed. |
(c) | The estimated resources required for each Service shall be set forth on the Schedules. Unless otherwise provided with respect to a specific Service on the Schedules hereto, the Provider shall not be obligated to perform or to cause to be performed any Service in a manner that is materially more burdensome (with respect to service quality or quantity) than analogous services provided to Parent or its applicable functional group or Subsidiary (collectively referred to as the “Level of Service”) during the one year period ending on the last day of Parent’s last fiscal quarter completed on or prior to the date of the Distribution (the “Service Baseline Period”). If the Recipient requests that the Provider perform or cause to be performed any Service that exceeds the Level of Service during the Service Baseline Period, then the Parties shall cooperate and act in good faith to determine whether the Provider could be required to provide such requested higher |
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(d) | (i) Neither the Provider nor any of its Subsidiaries shall be required to perform or to cause to be performed any of the Services for the benefit of any Third Party or any other Person other than the Recipient and its Subsidiaries, and (ii) EXCEPT AS EXPRESSLY PROVIDED IN THIS SECTION 2.02 OR SECTION 7.04, EACH PARTY ACKNOWLEDGES AND AGREES THAT ALL SERVICES ARE PROVIDED ON AN “AS-IS” BASIS, THAT THE RECIPIENT ASSUMES ALL RISK AND LIABILITY ARISING FROM OR RELATING TO ITS USE OF AND RELIANCE UPON THE SERVICES, AND THAT THE PROVIDER MAKES NO OTHER REPRESENTATIONS OR GRANTS ANY WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, WITH RESPECT TO THE SERVICES. EACH PARTY SPECIFICALLY DISCLAIMS ANY OTHER WARRANTIES, WHETHER WRITTEN OR ORAL, OR EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF QUALITY, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR USE OR PURPOSE OR THE NON-INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES. |
(e) | Each Party shall be responsible for its own compliance with any and all Laws applicable to its performance under this Agreement. No Party shall knowingly take any action in violation of any such applicable Law that results in Liability being imposed on the other Party. |
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Party), provided that the Provider will notify the Recipient in writing of any such change in rates at least fifteen (15) days prior to the effective date of such rate change. Together with any invoice for Charges, the Provider shall provide the Recipient with reasonable documentation, including any additional documentation reasonably requested by the Recipient to the extent that such documentation is in the Provider’s or its Subsidiaries’ possession or control, to support the calculation of such Charges.
Section 2.04 Reimbursement for Out-of-Pocket Costs and Expenses. The Recipient shall reimburse the Provider for reasonable out-of-pocket costs and expenses incurred by the Provider or any of its Subsidiaries in connection with providing the Services (including reasonable travel-related expenses, provided such travel-related expenses comply with the Recipient’s then-applicable business travel policies) to the extent that such costs and expenses are not reflected in the Charges for such Services; provided, however, that any such cost or expense in excess of five thousand dollars ($5,000) that is not consistent with historical practice between the Parties for any individual Service (including business travel and related expenses) shall require advance written approval of the Recipient; provided further, that if the Recipient does not provide such advance written approval and the incurrence of such cost or expense is reasonably necessary for Provider to provide such Service in accordance with the standards set forth in this Agreement, Provider shall not be required to perform such Service. Any reimbursable travel-related expenses incurred in performing the Services shall be incurred and charged to the Recipient in accordance with the Recipient’s then-applicable business travel policies, so long as Provider has received copies of such travel policies at a reasonable time prior to the time such expenses are incurred.
Section 2.05 Changes in the Performance of Services. Subject to the performance standards for Services set forth in Sections 2.02(a), 2.02(b) and 2.02(c), the Provider may make changes from time to time in the manner of performing the Services if the Provider is making similar changes in performing analogous services for itself and if the Provider furnishes to the Recipient reasonable prior written notice (in content and timing) of such changes. If such change shall materially adversely affect the timeliness or quality of, or the Charges for, the applicable Service, the Recipient shall be permitted to terminate this Agreement pursuant to Section 5.02(a)(i) without being required to pay any Termination Charges pursuant to Section 5.04 or comply with clauses (x), (y) and (z) of Section 5.02(a)(i).
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standard for Services set forth in Sections 2.02(a), 2.02(b) and 2.02(c) and the content of the Services provided to the Recipient. Such Provider shall be liable for any breach of its obligations under this Agreement by any Third Party service provider engaged by such Provider. Subject to the confidentiality provisions set forth in Article VI, each Party shall, and shall cause their respective Affiliates to, provide, upon fifteen (15) business days’ prior written notice from the other Party, any Information within such Party’s or its Affiliates’ control that the requesting Party reasonably requests in connection with any Services being provided to such requesting Party by a Third Party, including any applicable invoices, agreements documenting the arrangements between such Third Party and the Provider and other supporting documentation; provided, further, however, that each Party shall make no more than one such request per Third Party during any calendar quarter.
Article III.
(a) | SpinCo shall, and shall cause its Subsidiaries to, allow Parent and its Subsidiaries and their respective Representatives reasonable access during normal business hours to the facilities of SpinCo and its Subsidiaries that is reasonably necessary for Parent and its Subsidiaries to fulfill their obligations under this Agreement. In addition to the foregoing right of access, SpinCo shall, and shall cause its Subsidiaries to, afford Parent, its Subsidiaries and their respective Representatives, upon reasonable advance written notice, reasonable access during normal business hours to the facilities, Information, systems, infrastructure and personnel of SpinCo and its Subsidiaries as reasonably necessary for Parent 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 SpinCo or its Subsidiaries, including in connection with verifying compliance with Section 404 of the Xxxxxxxx-Xxxxx Act of 2002; provided that (i) such access shall not unreasonably interfere with any of the business or operations of SpinCo or any of its Subsidiaries and (ii) in the event that SpinCo determines that providing such access could reasonably be commercially detrimental, violate any applicable 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 consequence. Parent agrees that all of its and its Subsidiaries’ employees shall, and that it shall use commercially reasonable efforts to cause its Representatives’ employees to, when on the property of SpinCo or its Subsidiaries, or when given access to any facilities, Information, systems, infrastructure or personnel of SpinCo or its Subsidiaries, conform to the policies and procedures of SpinCo and its Subsidiaries, as applicable, concerning health, safety, conduct and security which are made known or provided to Parent from time to time. |
(b) | Parent shall, and shall cause its Subsidiaries to, allow SpinCo and its Subsidiaries and their respective Representatives reasonable access during normal business hours to the facilities of Parent and its Subsidiaries that is reasonably necessary for SpinCo and its Subsidiaries to fulfill their obligations under this Agreement. In addition to the foregoing |
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right of access, Parent shall, and shall cause its Subsidiaries to, afford SpinCo, its Subsidiaries and their respective Representatives, upon reasonable advance written notice, reasonable access during normal business hours to the facilities, Information, systems, infrastructure and personnel of Parent and its Subsidiaries as reasonably necessary for SpinCo 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 Parent or its Subsidiaries, including in connection with verifying compliance with Section 404 of the Xxxxxxxx-Xxxxx Act of 2002; provided that (i) such access shall not unreasonably interfere with any of the business or operations of Parent or any of its Subsidiaries and (ii) in the event that Parent determines that providing such access could be commercially detrimental, violate any applicable 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 consequence. SpinCo agrees that all of its and its Subsidiaries’ employees shall, and that it shall use commercially reasonable efforts to cause its Representatives’ employees to, when on the property of Parent or its Subsidiaries, or when given access to any facilities, Information, systems, infrastructure or personnel of Parent or its Subsidiaries, conform to the policies and procedures of Parent and its Subsidiaries, as applicable, concerning health, safety, conduct and security which are made known or provided to SpinCo from time to time. |
Article IV.
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Article V.
(a) | This Agreement shall commence at the Effective Time and shall terminate upon the earlier to occur of (i) the last date on which either Party is obligated to provide any Service to the other Party in accordance with the terms of this Agreement; (ii) the mutual written agreement of the Parties to terminate this Agreement in its entirety; and (iii) the date that is the two (2 ) year anniversary of the Distribution Date. Unless otherwise terminated pursuant to Section 5.02, this Agreement shall terminate with respect to each Service as of the close of business on the last day of the Service Period for such Service. |
(b) | Following 120 days after the date hereof, if the Recipient reasonably determines that it will require a Service to continue beyond the date on which such Service is scheduled to terminate, the Recipient may request that the Provider extend such Service (any such extension, a “Service Extension”) for a specified period beyond the scheduled termination of such Service (which period shall in no event be shorter than sixty (60) days) by written notice to the Provider no less than thirty (30) days prior to the date of such scheduled termination, and Provider shall consider any such request in good faith; provided, however, that no Party shall be obligated to agree to any Service Extension, including because, after good-faith negotiations between the Parties, the Parties fail to reach an agreement with respect to the terms thereof; provided, further, however, that (i) there shall be no more than one (1) Service Extension with respect to each Service and (ii) the Provider shall not be obligated to provide such Service Extension if a Third Party consent is required. In connection with any request for Service Extensions in accordance with this Section 5.01(b), the Parties shall in good faith (x) negotiate the terms of an amendment to the applicable Schedule, which amendment shall be consistent with the terms of, and the pricing methodology and rates used for, similar Services provided under |
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this Agreement and (y) determine the costs and expenses (other than Service Charges), if any, that would be incurred by the Provider or the Recipient, as the case may be, in connection with the provision of such Service Extension, which costs and expenses shall be borne solely by the Party requesting the Service Extension. Each amended Schedule to implement a Service Extension, as agreed to in writing by the Parties, shall be deemed part of this Agreement as of the date of such agreement and any Services provided pursuant to such Service Extensions shall be deemed “Services” provided under this Agreement, in each case subject to the terms and conditions of this Agreement. Notwithstanding anything herein to the contrary, the term for any Service, as extended by a Service Extension, shall not exceed the date that is the two (2) year anniversary of the Distribution Date. |
Section 5.02 Early Termination.
(a) | Subject to certain limitations set forth on the Schedules, and without prejudice to the Recipient’s rights with respect to Force Majeure, the Recipient may from time to time terminate this Agreement with respect to the entirety or portion of any Service (for the avoidance of doubt, the Recipient may terminate any Service (or portion thereof) set forth on any part of the Schedules hereto without terminating all or any other Services set forth on the same Schedule as such terminated Service (or portion thereof)): |
(i) | for any reason or no reason, upon the giving of at least thirty (30) days’ prior written notice (or such other number of days specified in the Schedules hereto) to the Provider of such Service; provided, however, that any such termination (x) may not be effective prior to the end of the Minimum Service Period, (y) may only be effective as of the last day of a month and (z) shall be subject to the obligation to pay any applicable Termination Charges pursuant to Section 5.04; or |
(ii) | if the Provider of such Service has failed to perform any of its material obligations under this Agreement with respect to such Service, and such failure shall continue to be uncured by the Provider for a period of at least thirty (30) days after receipt by the Provider of written notice of such failure from the Recipient; provided, however, that the Recipient shall not be entitled to terminate this Agreement with respect to the applicable Service if, as of the end of such period, there remains a good-faith Dispute between the Parties (undertaken in accordance with the terms of Section 8.16) as to whether the Provider has cured the applicable breach. |
(b) | The Provider may terminate this Agreement with respect to the entirety or portion of any Service at any time upon prior written notice to the Recipient if the Recipient has failed to perform any of its material obligations under this Agreement with respect to such Service, including making payment of Charges for such Service when due, and such failure shall continue to be uncured by the Recipient for a period of at least thirty (30) days after receipt by the Recipient of a written notice of such failure from the Provider; provided, however, that the Provider shall not be entitled to terminate this Agreement with respect to the applicable Service if, as of the end of such period, there remains a good-faith Dispute between the Parties (undertaken in accordance with the terms of Section 8.16) as to whether the Recipient has cured the applicable breach. The Schedules hereto shall be updated to reflect any terminated Service. |
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Article VI.
CONFIDENTIALITY; PROTECTIVE ARRANGEMENTS
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applicable Law or receives any request or demand under lawful process or from any Governmental Authority to disclose or provide information of the other Party (or any of its Subsidiaries) that is subject to the confidentiality provisions hereof, such Party shall notify the other Party (to the extent legally permitted) as promptly as practicable under the circumstances prior to disclosing or providing such information and shall cooperate, at the expense of the other Party, in seeking any appropriate protective order requested by the other Party. In the event that such other Party fails to receive such appropriate protective order in a timely manner and the Party receiving the request or demand reasonably determines that its failure to disclose or provide such information shall actually prejudice the Party receiving the request or demand, then the Party that received such request or demand may thereafter disclose or provide information to the extent required by such Law (as so advised by its counsel) or by lawful process or such Governmental Authority, and the disclosing Party shall promptly provide the other Party with a copy of the information so disclosed, in the same form and format so disclosed, together with a list of all Persons to whom such information was disclosed, in each case to the extent legally permitted.
Article VII.
LIMITED LIABILITY AND INDEMNIFICATION
Section 7.01 Limitations on Liability.
(a) | SUBJECT TO SECTION 7.02 AND SECTION 7.01(C), THE LIABILITIES OF THE PROVIDER AND ITS SUBSIDIARIES AND THEIR RESPECTIVE REPRESENTATIVES, COLLECTIVELY, UNDER THIS AGREEMENT FOR ANY ACT OR FAILURE TO ACT IN CONNECTION HEREWITH (INCLUDING THE PERFORMANCE OR BREACH OF THIS AGREEMENT), OR FROM THE SALE, DELIVERY, PROVISION OR USE OF ANY SERVICES PROVIDED UNDER OR CONTEMPLATED BY THIS AGREEMENT, WHETHER IN CONTRACT, TORT (INCLUDING NEGLIGENCE AND STRICT LIABILITY) OR OTHERWISE, SHALL NOT EXCEED THE AGGREGATE CHARGES ACTUALLY PAID TO THE PROVIDER FOR SERVICES PURSUANT TO THIS AGREEMENT. |
(b) | IN NO EVENT SHALL EITHER PARTY, ITS SUBSIDIARIES OR THEIR RESPECTIVE REPRESENTATIVES BE LIABLE TO THE OTHER PARTY FOR ANY INDIRECT, PUNITIVE, EXEMPLARY, REMOTE, SPECULATIVE OR SIMILAR DAMAGES IN EXCESS OF COMPENSATORY DAMAGES OF THE OTHER PARTY IN CONNECTION WITH THE PERFORMANCE OF THIS AGREEMENT (OTHER THAN ANY SUCH LIABILITY WITH RESPECT TO A THIRD-PARTY CLAIM), AND EACH PARTY HEREBY WAIVES ON BEHALF OF ITSELF, ITS SUBSIDIARIES AND ITS REPRESENTATIVES ANY CLAIM FOR SUCH DAMAGES, WHETHER ARISING IN CONTRACT, TORT OR OTHERWISE. |
(c) | The limitations in Section 7.01(a) and Section 7.01(b) shall not apply in respect of any Liability arising out of or in connection with (i) either Party’s Liability for breaches of confidentiality under Article VI, (ii) either Party’s obligations under Section 7.03 or 7.04, (iii) the gross negligence, willful misconduct or fraud of or by the Party to be charged or (iv) either Party’s obligations or liabilities under the Intellectual Property Matters Agreement. |
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Article VIII.
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reasons. The relationships of the Parties hereunder are those of independent contractors and nothing contained herein shall be deemed to create a joint venture, partnership or any other relationship between the Parties. Employees performing Services hereunder do so on behalf of, under the direction of, and as employees of, the Provider, and the Recipient shall have no right, power or authority to direct such employees, unless otherwise specified with respect to a particular Service on the Schedules hereto.
Section 8.06 Counterparts; Entire Agreement; Corporate Power.
(a) | This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement, and shall become effective when one or more counterparts have been signed by each of the Parties and delivered to the other Party. |
(b) | This Agreement, the Separation and Distribution Agreement and the other Ancillary Agreements and the Exhibits, Schedules and appendices hereto and thereto contain the entire agreement between the Parties with respect to the subject matter hereof, supersede all previous agreements, negotiations, discussions, writings, understandings, commitments and conversations with respect to such subject matter, and there are no agreements or understandings between the Parties other than those set forth or referred to herein or therein. This Agreement, the Separation and Distribution Agreement, and the other Ancillary Agreements govern the arrangements in connection with the Separation and Distribution and would not have been entered independently. |
(c) | Parent represents on behalf of itself and, to the extent applicable, each of its Subsidiaries, and SpinCo represents on behalf of itself and, to the extent applicable, each of its Subsidiaries, as follows: |
(i) each such Person has the requisite corporate or other power and authority and has taken all corporate or other action necessary in order to execute, deliver and perform this Agreement and to consummate the transactions contemplated hereby; and
(ii) this Agreement has been duly executed and delivered by it and constitutes a valid and binding agreement of it and is enforceable in accordance with the terms hereof.
(d) | Each Party acknowledges and agrees that delivery of an executed counterpart of a signature page to this Agreement (whether executed by manual, stamp or mechanical signature) by facsimile or by email in portable document format (PDF) shall be effective as delivery of such executed counterpart of this Agreement. Each Party expressly adopts and confirms each such facsimile, stamp or mechanical signature (regardless of whether delivered in person, by mail, by courier, by facsimile or by email in portable document format (PDF)) made in its respective name as if it were a manual signature delivered in person, agrees that it will not assert that any such signature or delivery is not adequate to bind such Party to the same extent as if it were signed manually and delivered in person and agrees that, at the reasonable request of the other Party at any time, it will as |
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promptly as reasonably practicable cause this Agreement to be manually executed (any such execution to be as of the date of the initial date thereof) and delivered in person, by mail or by courier. |
Section 8.07 Governing Law. This Agreement (and any claims or disputes arising out of or related hereto or to the transactions contemplated hereby or to the inducement of any Party to enter herein, whether for breach of contract, tortious conduct or otherwise and whether predicated on common law, statute or otherwise) shall be governed by and construed and interpreted in accordance with the Laws of the State of Delaware, irrespective of the choice of Laws principles of the State of Delaware, including all matters of validity, construction, effect, enforceability, performance and remedies.
If to Parent, to:
Varian Medical Systems, Inc.
0000 Xxxxxx Xxx
Xxxx Xxxx, Xxxxxxxxxx 00000
Attention: General Counsel
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If to SpinCo, to:
Varex Imaging Corporation.
0000 X. Xxxxxxx Xxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Attention: General Counsel
Either Party may, by notice to the other Party, change the address to which such notices are to be given.
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Section 8.16 Dispute Resolution.
(a) | In the event of any controversy, dispute or claim (a “Dispute”) arising out of or relating to any Party’s rights or obligations under this Agreement (whether arising in contract, tort or otherwise), calculation or allocation of the costs of any Service or otherwise arising out of or relating in any way to this Agreement (including the interpretation or validity of this Agreement), such Dispute shall be resolved in accordance with the dispute resolution process referred to in Article VII of the Separation and Distribution Agreement. |
(b) | In any Dispute regarding the amount of a Charge or a Termination Charge, if such Dispute is finally resolved pursuant to the dispute resolution process set forth or referred to in Section 8.16(a) and it is determined that the Charge or the Termination Charge, as applicable, that the Provider has invoiced the Recipient, and that the Recipient has paid to the Provider, is greater or less than the amount that the Charge or the Termination Charge, as applicable, should have been, then (i) if it is determined that the Recipient has overpaid the Charge or the Termination Charge, as applicable, the Provider shall within ten (10) calendar days after such determination reimburse the Recipient an amount of cash equal to such overpayment, plus the Interest Payment, accruing from the date of payment by the Recipient to the time of reimbursement by the Provider; and (ii) if it is determined that the Recipient has underpaid the Charge or the Termination Charge, as applicable, the Recipient shall within ten (10) calendar days after such determination reimburse the Provider an amount of cash equal to such underpayment, plus the Interest Payment, accruing from the date such payment originally should have been made by the Recipient to the time of payment by the Recipient. Prior to implementation of the dispute resolution process referred to in Article VII of the Separation and Distribution Agreement, the Parties shall use their respective commercially reasonable efforts, if practicable, to attempt in good faith to resolve any Dispute in accordance with the procedures set forth in Schedule 8.16. |
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this Agreement during the course of dispute resolution pursuant to the provisions of Section 8.16 and this Section 8.17 with respect to all matters not subject to such Dispute; provided, however, that this obligation shall only exist during the term of this Agreement.
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VARIAN MEDICAL SYSTEMS, INC. | ||||
By: | /s/ Xxxx X. Xxx | |||
Name: | Xxxx X. Xxx | |||
Title: | Senior Vice President, General Counsel and Corporate Secretary | |||
VAREX IMAGING CORPORATION | ||||
By: | /s/ Xxxxxxxxx X. Xxxxxxxxx | |||
Name: | Xxxxxxxxx X. Xxxxxxxxx | |||
Title: | Senior Vice President, General Counsel and Corporate Secretary |
[Signature Page to Transition Services Agreement]