INTERCORPORATE SERVICES AGREEMENT
BETWEEN
CONTRAN CORPORATION
AND
VALHI, INC.
Dated as of January 1, 2004
TABLE OF CONTENTS
Page
ARTICLE I. AMENDS AND SUPERSEDES PRIOR AGREEMENT..........................1
ARTICLE II. RETENTION OF CONTRAN..........................................1
Section 2.1. Performance of Services.............................1
Section 2.2. Director Services Not Included......................2
Section 2.3. Outside Services....................................2
Section 2.4. Disclaimer, Limited Liability; Indemnification......2
ARTICLE III. COMPENSATION.................................................3
Section 3.1. Compensation for Services...........................3
Section 3.2. Out-of-Pocket Costs.................................3
ARTICLE IV. CONFIDENTIALITY...............................................3
Section 4.1. Confidentiality.....................................3
ARTICLE V. MISCELLANEOUS..................................................3
Section 5.1. Maintenance and Inspection of Records...............3
Section 5.2. Notices.............................................4
Section 5.3. Term; Renewal.......................................4
Section 5.4. Independent Contractor..............................4
Section 5.5. Force Majeure.......................................4
Section 5.6. Entire Agreement....................................5
Section 5.7. Amendments..........................................5
Section 5.8. Severability........................................5
Section 5.9. Counterparts........................................5
Section 5.10. Successors and Assigns.............................5
Section 5.11. Governing Law......................................5
Section 5.12. Submission to Jurisdiction; Service; Waivers.......5
Section 5.13. No Third-Party Beneficiaries.......................6
Section 5.14. Titles and Headings................................6
INTERCORPORATE SERVICES AGREEMENT
This Intercorporate Services Agreement ("Agreement") is entered into
effective as of January 1, 2004 (the "Effective Date"), between Contran
Corporation, a Delaware corporation ("Contran"), and Valhi, Inc., a Delaware
corporation ("Valhi")
Recitals
A. Valhi is an indirectly held subsidiary of Contran.
B. Valhi has and will have the need for executive, management, financial,
audit, accounting, tax, legal, insurance, risk management, treasury, aviation,
human resources, technical, consulting, administrative and other services as
required from time to time in the ordinary course of Valhi's business
(collectively, the "Services"), but has determined that it is not cost effective
to obtain and separately maintain the infrastructure associated with the
Services, particularly the costs associated with attracting and maintaining on
its payroll on a full time basis a full complement of skilled employees.
C. Contran is able and willing to provide the Services to Valhi, and Valhi
desires to engage Contran as an independent contractor to provide the Services
in accordance with the terms set forth in this Agreement.
Agreement
For and in consideration of the mutual promises, representations and
covenants contained in this Agreement, the parties agree as follows.
ARTICLE I.
AMENDS AND SUPERSEDES PRIOR AGREEMENT
This Agreement amends and supersedes in its entirety that certain
Intercorporate Services Agreement effective as of January 1, 2003 by and between
Contran and Valhi.
ARTICLE II.
RETENTION OF CONTRAN
Section 2.1. Performance of Services.
(a) Valhi hereby engages and retains Contran to perform the Services
and Contran hereby accepts and agrees to provide such Services to Valhi
upon the terms and conditions set forth in this Agreement. All Services to
be provided by Contran hereunder shall be performed at the request and
under the direction of Valhi, and Contran shall not have any power to act
independently on behalf of Valhi other than as specifically authorized
under this Agreement or from time to time by Valhi. Contran shall provide
Services in connection with routine functions related to the ongoing
ordinary course of Valhi's business. The Services rendered in connection
with the conduct of Valhi's business will be on a scale compared to that
existing on the effective date of this Agreement, adjusted for internal
corporate growth or contraction, but not for major corporate acquisitions
or divestitures, and that adjustments may be required to the terms of this
Agreement in the event of such major corporate acquisitions, divestitures
or special projects.
(b) Contran shall determine the corporate facilities to be used in
rendering the Services and the individuals who will render such Services.
(c) Contran will use reasonable efforts to make the Services available
with substantially the same degree of care as it employs in making similar
services available for its own operations.
(d) Those employees or agents of Contran who perform similar services
for Contran or for other affiliates of Contran, or both, will perform the
Services.
(e) Nothing herein shall be deemed to restrict either party or its
directors, officers, employees or agents from engaging in any business, or
from contracting with other parties, including, without limitation, other
affiliates of Contran, for similar or different services.
Section 2.2. Director Services Not Included. The Services do not include
any services that employees of Contran may provide to Valhi in their roles as
members of Valhi's board of directors or any other activity related to such
board of directors.
Section 2.3. Outside Services. Valhi will continue to bear all other costs
required for outside services including, but not limited to, the outside
services of attorneys, auditors, trustees, consultants, transfer agents and
registrars, and it is expressly understood that Contran assumes no liability for
any expenses or services other than those stated in this Article.
Section 2.4. Disclaimer, Limited Liability; Indemnification.
(a) Except as expressly provided elsewhere in this Agreement, Contran
makes no express or implied representations, warranties or guarantees
relating to the Services or the quality or results of the Services to be
performed under this Agreement.
(b) Contran, its directors, officers, employees, stockholders or
agents shall not be liable to Valhi or any third party, including any
governmental agency, for any claims, demands, losses, liabilities, damages,
costs or expenses, including attorneys' and expert witness fees, arising
from or in connection with the Services, other than those arising from or
in connection with the gross negligence or willful misconduct of Contran or
its directors, officers, employees, stockholders or agents (collectively,
"No Liability Claims").
(c) Valhi assumes all liability for, and agrees to defend, indemnify
and hold Contran harmless from and against all No Liability Claims. Valhi
assumes all liability for, and agrees to defend, indemnify and hold
Contran's directors, officers, employees, stockholders or agents harmless
from, No Liability Claims to the same extent that Contran could assume such
liability for, or defend, indemnify and hold harmless, such entity or
person. Valhi shall promptly advance expenses as incurred by Contran its
directors, officers, employees, stockholders or agents in connection with
Valhi's obligations under this Section.
ARTICLE III.
COMPENSATION
Section 3.1. Compensation for Services.
(a) Contran and Valhi shall agree on the aggregate annual amount that
Valhi shall pay Contran for the Services for a particular year.
(b) Valhi shall pay to Contran one fourth of the annual amount in
advance quarterly around the first business day of each quarter.
(c) From time to time upon a change to the annual amount for a
particular year, Contran or Valhi, as applicable, shall promptly make
appropriate payments to the other party to reflect such change.
(d) All charges from Contran to Valhi are intended to be equal to the
actual cost of such expenses without premium or xxxx-up to Contran.
Section 3.2. Out-of-Pocket Costs. In addition to the fee paid to Contran by
Valhi for the Services, Valhi will promptly pay to Contran the amount of
out-of-pocket costs incurred by Contran in rendering such Services.
ARTICLE IV.
CONFIDENTIALITY
Section 4.1. Confidentiality. Each party shall hold and shall cause its
directors, officers, employees, agents, consultants and advisors
("Representatives") to hold in strict confidence all information concerning the
other party unless (i) such party is compelled to disclose such information by
judicial or administrative process or, in the opinion of its counsel, by other
requirements of law or (ii) such information can be shown to have been (A) in
the public domain through no fault of such party or (B) lawfully acquired on a
non-confidential basis from other sources. Notwithstanding the foregoing, such
party may disclose such information to its Representatives so long as such
persons are informed by such party of the confidential nature of such
information and are directed by such party to treat such information
confidentially. If such party or any of its Representatives becomes legally
compelled to disclose any documents or information subject to this Section, such
party will promptly notify the other party so that the other party may seek a
protective order or other remedy or waive such party's compliance with this
Section. If no such protective order or other remedy is obtained or waiver
granted, such party will furnish only that portion of the information that it is
advised by counsel is legally required and will exercise its reasonable efforts
to obtain adequate assurance that confidential treatment will be accorded such
information. Such party agrees to be responsible for any breach of this Section
by it and its Representatives.
ARTICLE V.
MISCELLANEOUS
Section 5.1. Maintenance and Inspection of Records. Contran shall keep
accurate books, accounts and records regarding the Services as may be reasonably
necessary for purposes of this Agreement. Valhi shall be permitted to inspect
such books, accounts and records at any reasonable time.
Section 5.2. Notices. All notices and other communications hereunder shall
be in writing, and shall be delivered by hand or mailed by registered or
certified mail (return receipt requested) or transmitted by facsimile to the
parties at the following addresses (or at such other addresses for a party as
shall be specified by like notice) and shall be deemed given on the date on
which such notice is received:
If to Contran: Contran Corporation.
Three Lincoln Centre
0000 XXX Xxxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000-0000
Attention: General Counsel
Phone: 000.000.0000
Fax: 000.000.0000
If to Valhi: Valhi, Inc.
Three Lincoln Centre
0000 XXX Xxxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000-0000
Attention: General Counsel
Phone: 000.000.0000
Fax: 000.000.0000
Section 5.3. Term; Renewal. The initial term of this Agreement shall
commence as of the Effective Date and end on December 31, 2004, but shall be
automatically renewed on a quarter-to-quarter basis after the expiration of the
initial term. Either party may terminate this Agreement by giving written notice
of termination to the other party not less than thirty (30) days in advance of
the first day of each successive quarter. In addition, in the event of a
material default hereunder by a party, the non-defaulting party may terminate
this Agreement upon thirty (30) days prior written notice if such default
remains uncured and is continuing for twenty (20) days after receipt by the
defaulting party of such written notice of intent to terminate. A final
accounting and payment by one party to the other of all amounts payable
hereunder shall be made pursuant to the terms hereof within thirty (30) days
following such termination.
Section 5.4. Independent Contractor. Contran shall be an independent
contractor and not an employee of, or partner or joint venturer with, Valhi.
Section 5.5. Force Majeure. No party shall be in default of this Agreement
or liable to the other party for any delay or default in performance where
occasioned by any cause of any kind or extent beyond its control, including but
not limited to, armed conflict or economic dislocation resulting therefrom;
embargoes; shortages of labor, raw materials, production facilities or
transportation; labor difficulties; civil disorders of any kind; action of any
civil or military authorities (including, priorities and allocations); fires;
floods and accidents. The dates on which the obligations of the party are to be
fulfilled shall be extended for a period equal to the time lost by reason of any
delay arising, directly or indirectly from:
(a) Any of the foregoing causes, or
(b) Inability of a party, as a result of causes beyond its reasonable
control, to obtain instruction or information from the other party in time
to perform its obligations by such dates.
Section 5.6. Entire Agreement. This Agreement constitutes the entire
understanding between the parties with respect to the subject matter hereof and
all prior agreements or understandings shall be deemed merged herein. No
representations, warranties and if certifications, express or implied, shall
exist as between the parties except as stated herein.
Section 5.7. Amendments. No amendments, waivers or modifications hereof
shall be made or deemed to have been made unless in writing, executed by the
party to be bound thereby.
Section 5.8. Severability. If any provision in this Agreement or the
application of such provision to any person or circumstance shall be invalid,
illegal or unenforceable, the remainder of this Agreement or the application of
such provision to persons or circumstances other than those to which it is held
invalid, illegal or unenforceable shall not be affected thereby.
Section 5.9. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original
and all of which when taken together shall constitute this Agreement.
Section 5.10. Successors and Assigns. This Agreement shall not be
assignable, in whole or in part, directly or indirectly, by any party hereto
without the prior written consent of the other party hereto, and any attempt to
assign any rights or obligations arising, under this Agreement without such
consent shall be void. This Agreement shall be binding, upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.
Section 5.11. Governing Law. This Agreement shall be governed by and
construed in accordance with the domestic laws of the state of Texas, without
giving effect to any choice of law or conflict of law provision or rule (whether
of the state of Texas or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the state of Texas.
Section 5.12. Submission to Jurisdiction; Service; Waivers. WITH RESPECT TO
ANY CLAIM ARISING OUT OF THIS AGREEMENT, EACH PARTY (A) IRREVOCABLY SUBMITS, FOR
ITSELF AND ITS PROPERTY, TO THE JURISDICTION OF THE FEDERAL OR STATE COURTS
LOCATED IN DALLAS COUNTY, TEXAS (B) AGREES THAT THE VENUE FOR ANY SUIT, ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT SHALL BE EXCLUSIVE TO
SUCH COURTS, AND (C) IRREVOCABLY WAIVES ANY OBJECTION IT MAY HAVE AT ANY TIME TO
THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO THIS AGREEMENT BROUGHT IN ANY SUCH COURT, IRREVOCABLY WAIVES ANY CLAIM THAT
ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT
IN AN INCONVENIENT FORUM AND FURTHER IRREVOCABLY WAIVES THE RIGHT TO OBJECT,
WITH RESPECT TO SUCH CLAIM, SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT
THAT SUCH COURT DOES NOT HAVE JURISDICTION OVER IT. EACH PARTY HEREBY
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS IN ANY SUCH SUIT, ACTION OR
PROCEEDING IN ANY OF THE AFORESAID COURTS BY THE MAILING OF COPIES OF SUCH
PROCESS TO THE PARTY, BY CERTIFIED OR REGISTERED MAIL AT THE ADDRESS SPECIFIED
IN SECTION 5.2.
Section 5.13. No Third-Party Beneficiaries. This Agreement is solely for
the benefit of the parties hereto and should not be deemed to confer upon third
parties any remedy, claim, liability, reimbursement, claim of action or other
right in excess of those existing without reference to this Agreement.
Section 5.14. Titles and Headings. Titles and headings to sections herein
are inserted for convenience of reference only and are not intended to be a part
of or to affect the meaning or interpretation of this Agreement.
Executed as of the Effective Date.
CONTRAN CORPORATION
By:
---------------------------------------
Xxxxx X. X'Xxxxx, Vice President
VALHI, INC.
By:
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Xxxxxx X. Xxxxxx, Vice President
