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EXHIBIT 10.13
TRANSITIONAL SERVICES AGREEMENT
This TRANSITIONAL SERVICES AGREEMENT (this "Agreement") is made as of
June 30, 2000 by and between AUTONATION, INC., a Delaware corporation ("Parent")
and ANC RENTAL CORPORATION, a Delaware corporation ("Company").
WHEREAS, Parent and Company have entered into a Separation and
Distribution Agreement (the "Distribution Agreement") which contemplates (i) the
separation of the Company, which comprises the Parent's automotive rental
businesses and operations, from Parent's other businesses and operations (the
"Separation") and (ii) the distribution to Parent's stockholders on a tax-free
basis of all of the outstanding shares of the Company's common stock (the
"Distribution"); and
WHEREAS, in order to ensure an orderly transition under the
Distribution Agreement it will be necessary for Parent to provide to Company,
and for Company to provide to Parent, the services described herein during the
term of this Agreement.
NOW, THEREFORE, in consideration of the above premises and the mutual
covenants contained herein, it is agreed by and between the parties as follows:
ARTICLE I
FEES AND TERM
1.1 COMPANY PRICE/PAYMENT. As consideration for the services to be
provided to Company by Parent pursuant to Section 2.1 of this Agreement, Company
shall pay to Parent a fee (the "Company Services Fee") in accordance with the
attached fee schedule. The Company Services Fee shall be payable by Company to
Parent in arrears 15 days after the close of each month (prorated for any
partial month) during the term of this Agreement. Any services provided by
Parent to Company beyond the services covered by the Company Services Fee shall
be billed to Company at negotiated rates, no less favorable to the Company than
if Company had received the uncovered service from a third party, or on such
other basis as the parties may agree from time to time. The Company Services Fee
shall be reviewed and reduced from time to time in accordance with Section 2.3.
1.2 PARENT PRICE/PAYMENT. As consideration for the services to be
provided to Parent by Company pursuant to Section 3.1 of this Agreement, Parent
shall pay to Company a fee (the "Parent Services Fee") in accordance with the
attached fee schedule. The Parent Services Fee shall be payable by Parent to
Company in arrears 15 days after the close of each month (prorated for any
partial month) during the term of this Agreement. Any services provided by
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Company to Parent beyond the services covered by the Parent Services Fee shall
be billed to Parent at negotiated rates, no less favorable to the Parent than if
Parent had received the uncovered service from a third party, or on such other
basis as the parties may agree from time to time. The Parent Services Fee shall
be reviewed and reduced from time to time in accordance with Section 3.3.
1.3 TERM. The term of this Agreement (the "Term") shall commence on the
date hereof and shall expire one year after the effective date of the
Distribution (the "Distribution Date"); PROVIDED, HOWEVER, that either party
shall have the right to terminate any or all of the services such party is to
receive hereunder and cease paying the services fee associated with the
terminated services which such party would otherwise be required to pay therefor
upon 30 days written notice to the other party, and PROVIDED, FURTHER, that at
the end of the one-year term, if the parties have not terminated the agreement
earlier, either party may renew or extend the term of the agreement with respect
to the provision of any services for which that party has not previously
terminated the other party's provision or support thereof, however, neither
party shall have any obligation to renew or extend the term of this agreement
with respect to any services at the services fees established in the initial
term of this agreement.
1.4 ADDITIONAL SERVICES. At any time during the Term, if either party
identifies any service that is needed to assure a smooth and orderly transition
of the businesses and operations in connection with the Separation and the
Distribution, and that is not otherwise governed by the provisions of this
Agreement, the Distribution Agreement or any other agreement between the
parties, then the parties shall cooperate in determining whether there is a
mutually acceptable arm's-length basis on which one of the parties will provide
such service to the other party in exchange for a fee.
ARTICLE II
SERVICES TO BE PROVIDED BY PARENT TO COMPANY
2.1 SERVICES. Parent agrees to provide the following services (subject
to such modification or adjustment as may be mutually agreed upon by the
parties) to Company during the Term:
(a) HUMAN RESOURCES DEPARTMENT: The human resources department of
Parent shall provide and administer for certain employees, the
Company's 401(k) Plan, consistent with the current plans
maintained by Parent. Such administration will continue for
one full calendar month following the separation of the
Company from the Parent.
(b) INFORMATION TECHNOLOGY DEPARTMENT: The information technology
department of Parent shall provide certain employees of the
Company with use of personal computers which Parent has leased
from Dell Computers, Inc. until the termination of such lease
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or such earlier time as the Company shall no longer require
use of such personal computers. Monthly fees will be based on
actual counts of personal computers in the possession of the
Company.
2.2 DETAILS OF PERFORMANCE. Reasonable details of Parent's performance
of services hereunder may be specified in one or more memoranda signed by the
parties and such memoranda shall be deemed incorporated in this Agreement by
reference as if recited herein in their entirety.
2.3 PHASE OUT OF SERVICES; REDUCTION OF COMPANY SERVICES FEE. The
parties hereby acknowledge that Company will promptly take all steps to
internalize the services to be provided herein by acquiring its own staff or
outsourcing to third parties. The parties agree to periodically review the level
of services being utilized by Company, and from time to time to reduce the
Company Services Fee proportionately to account for reductions in the level of
services being provided hereunder.
ARTICLE III
SERVICES TO BE PROVIDED BY COMPANY TO PARENT
3.1 SERVICES. Company agrees to provide the following services (subject
to such modification or adjustment as may be mutually agreed upon by the
parties) to Parent during the Term:
(a) INFORMATIONAL TECHNOLOGY DEPARTMENT: The Informational
Technology Department of Company shall provide Parent with
benefits administration production support in a manner and
with a level of service consistent with past practice,
PROVIDED, that, if Parent is unable to obtain support for its
annual open enrollment process for benefits then Company will
provide such support in accordance with Section 1.4 hereof.
3.2 DETAILS OF PERFORMANCE. Reasonable details of Company's performance
of services hereunder may be specified in one or more memoranda signed by the
parties and such memoranda shall be deemed incorporated in this Agreement by
reference as if recited herein in their entirety.
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3.3 PHASE OUT OF SERVICES; REDUCTION OF PARENT SERVICES FEES. The
parties hereby acknowledge that Parent will promptly take all steps to
internalize the services to be provided herein by acquiring its own staff or
outsourcing to third parties. The parties agree to periodically review the level
of services being utilized by Parent, and from time to time to reduce the Parent
Services Fee proportionately to account for reductions in the level of services
being provided hereunder.
ARTICLE IV
MISCELLANEOUS
4.1 CONFIDENTIALITY. Neither party hereto shall use or disclose to any
other person at any time, any confidential or proprietary information or trade
secrets of the other party, including, without limitation, its customer lists,
programs, pricing and strategies except to those of its employees and those
other persons who need to know such information to fulfill such party's
obligations hereunder, provided that such party shall require that such other
persons agree to keep confidential such confidential or proprietary information
or trade secrets. Both parties shall provide to the other party semi-annually
upon such other party's written request, a list of all employees whose duties
have required access to confidential or proprietary information or trade
secrets, and any other employees or other persons who to the actual knowledge of
that party's officers have had access to such information during the preceding
six (6) month period, in each case, designating whether such persons are in the
employ of such party as of the date such list is provided. Both parties agree
that all drawings, specifications, data, memoranda, calculations, notes and
other materials, including, without limitation, any materials containing
confidential or proprietary information or trade secrets of the other party,
furnished in connection with this Agreement and any copies thereof are and shall
remain the sole and exclusive property of that other party and shall be
delivered to that party upon its request.
4.2 NO AGENCY. Both parties shall perform their respective services
under this Agreement as an independent contractor. Each party acknowledges and
agrees that it is not granted any express or implied authority to assume or
create any obligation or responsibility on behalf of the other party, or to bind
the other party with regard to third parties in any manner.
4.3 NOTICES. Any notices required or permitted to be provided pursuant
to this Agreement shall be provided in writing via e-mail, certified mail,
hand-delivery, telecopier with confirmation or normal mail service, addressed to
the recipient party at its e-mail or standard mailing address set forth on the
signature page.
4.4 FORCE MAJEURE. In the event that either party is prevented from
performing, or is unable to perform, any of its obligations under this Agreement
due to any act of God, fire, casualty, flood, war, strike, lock out, failure of
public utilities, injunction or any act, exercise, assertion or requirement of
governmental authority, epidemic, destruction of production facilities,
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insurrection, inability to procure materials, labor, equipment, transportation
or energy sufficient to meet manufacturing needs, or any other cause beyond the
reasonable control of the party invoking this provision, and if such party shall
have used its best efforts to avoid such occurrence and minimize its duration
and has given prompt written notice to the other party, then the affected
party's performance for the period of delay or inability to perform due to such
occurrence shall be suspended. Should either party fail to perform hereunder and
shall have provided proper notice to the other party that it is unable to
perform on account of one or more reasons set forth in this section, such party
may obtain replacement services from a third party for the duration of such
delay or inability to perform, or for such longer period as such party shall be
reasonably required to commit to in order to obtain such replacement services
and the services fee payable by such party shall be reduced accordingly.
ARTICLE V
GENERAL PROVISIONS
5.1 ENTIRE AGREEMENT. Except as contemplated in Sections 2.3 and 3.3,
this Agreement embodies the entire agreement and understanding of the parties
hereto with respect to the subject matter hereof, and supersedes all prior
agreements and understandings relative to said subject matter.
5.2 BINDING EFFECT. This Agreement shall be binding upon, and shall
inure to the benefit of Parent, Company and their respective successors and
assigns.
5.3 ASSIGNMENT. Neither this Agreement nor any rights or obligations
hereunder shall be assignable by either party without the prior written consent
of the other party hereto, which consent shall not be unreasonably withheld.
5.4 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the law of the State of Florida applicable to contracts to be
performed entirely in that State.
5.5 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original but all of which together shall
constitute one and the same instrument.
5.6 HEADINGS. The headings contained in this Agreement are for
reference purposes only and shall not affect the meaning or interpretation of
this Agreement.
(SIGNATURES APPEAR ON NEXT PAGE)
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Z
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed
as of the date first above written.
AUTONATION, INC.
By: /s/ XXX X. XXXXXXXX
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Name: XXX X. XXXXXXXX
Title: SENIOR VICE PRESIDENT,
GENERAL COUNSEL AND SECRETARY
Address: 000 X.X. 0xx Xxxxxx
Xx. Xxxxxxxxxx, XX 00000
Attn: General Counsel
E-mail: xxxxxxxxx@xxxxxxxxxx.xxx
ANC RENTAL CORPORATION
By: /s/ XXXXXX X. XXXXXXXX
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Name: XXXXXX X. XXXXXXXX
Title: SENIOR VICE PRESIDENT,
GENERAL COUNSEL AND SECRETARY
Address: 000 Xxxxx Xxxxxxx Xxx.
Xx. Xxxxxxxxxx, XX 00000
Attn: General Counsel
E-mail: xxxxxxxxx@xxxxxxxxx.xxx
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