Exhibit 10.1
TRANSITION SERVICES AGREEMENT
between
CNF SERVICE COMPANY, INC.
and
CONSOLIDATED FREIGHTWAYS CORPORATION
TABLE OF CONTENTS
ARTICLE 1 SERVICES TO BE PROVIDED
Section 1.1 General Description; Provision of
Services; Volume Discounts 2
Section 1.2 Performance Levels 2
Section 1.3 Instructions 3
Section 1.4 Consents; Indemnification; Assets 3
Section 1.5 Systems Availability and Data
Integrity 5
Section 1.6 Systems Users 5
ARTICLE 2 PAYMENT FOR SERVICES
Section 2.1 Costs 6
Section 2.2 Invoices; Payment Procedures 6
Section 2.3 Disputed Fees 7
ARTICLE 3 TERM; TERMINATION OF SERVICES
Section 3.1 Term 7
Section 3.2 Termination of Services 8
ARTICLE 4 COOPERATION
Section 4.1 Cooperation 8
Section 4.2 Provider Administrative Records 9
Section 4.3 Periodic Review of Services 9
ARTICLE 5 FORCE MAJEURE
Section 5.1 Force Majeure 9
ARTICLE 6 CONFIDENTIALITY
Section 6.1 Confidentiality 10
ARTICLE 7 MISCELLANEOUS
Section 7.1 Notices 12
Section 7.2 Severability 13
Section 7.3 Binding Effect; Assignment 13
Section 7.4 No Third Party Beneficiaries 13
Section 7.5 Interpretation 13
Section 7.6 Jurisdiction and Consent to
Service 13
Section 7.7 Entire Agreement 14
Section 7.8 Governing Law 14
Section 7.9 Counterparts 14
Section 7.10 Relationship of the Parties 14
Section 7.11 Waiver 15
Section 7.12 Sole Remedy; No Damages 15
Section 7.13 Indemnification 15
TRANSITION SERVICES AGREEMENT
TRANSITION SERVICES AGREEMENT ("Agreement")
dated as of December 2, 1996, by and between CNF Service
Company, Inc., a corporation organized under the laws of
the State of Delaware (together with its wholly owned
subsidiaries, "Provider"), and Consolidated Freightways
Corporation, a corporation organized under the laws of
the State of Delaware (together with its wholly owned
subsidiaries, "Recipient").
W I T N E S S E T H
WHEREAS, Provider is a wholly owned subsidiary
of Consolidated Freightways, Inc., a Delaware corporation
("CFI");
WHEREAS, pursuant to that certain Distribution
Agreement dated as of the date hereof (the "Distribution
Agreement"), all of the shares of common stock of Recipi
ent are being distributed (the "Distribution") to the
stockholders of CFI;
WHEREAS, prior to the Distribution, Xxxxxx
Xxxxx Xxxxxxx Corporation, a Delaware corporation
("LJSC") provided services to Consolidated Freightways
Corporation of Delaware ("CFCD"), the principal operating
subsidiary of Recipient;
WHEREAS, in connection with the Distribution,
certain service capabilities of LJSC are being trans
ferred to Provider;
WHEREAS, in order for Recipient to operate CFCD
effectively in a transition period following the consumma
tion of the Distribution, Recipient desires to enter into
certain arrangements with Provider with respect to the
performance of certain transition services;
WHEREAS, Provider is willing to enter into such
transition arrangements on the terms and conditions set
forth herein.
Page 1
NOW, THEREFORE, the parties hereto agree as
follows:
Page 2
2 SERVICES TO BE PROVIDED
2.1 General Description; Provision of Services; Volume
Discounts. (a) The purpose of this Agreement is to set
forth the terms upon which Recipient is to receive cer
tain services from Provider on an interim basis after the
Distribution on the terms and subject to the conditions
herein (the "Services").
a) Pursuant to the terms and conditions of this
Agreement, Provider shall provide, and Recipient shall
purchase, the Services as described in Exhibit A hereto;
provided, however, that each of the parties hereto
acknowledges and agrees that Services may be added to, or
deleted from, Exhibit A by mutual consent of the parties
at any time (and the Service Fees (as defined) adjusted
appropriately).
2.2 Performance Levels. In providing the Services,
Provider shall perform according to the performance
levels maintained by LJSC in the past; or, should any in
stance arise in which none of such performance levels ap
plies, Provider shall act to substantially the same
extent, in substantially the same manner and with sub
stantially the same degree of care and diligence as LJSC
would have acted, prior to the Distribution, if it had
provided such Services to CFCD. Each Service shall be
provided priority no less favorably than in the past, con
sistent with past practices and without discrimination
against Recipient.
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2.3 Instructions. The parties agree that the Services
provided by Provider shall be essentially ministerial in
nature so that Provider shall, in all matters requiring
the exercise of discretion, follow Recipient's instruc
tions, which shall be promptly provided to Provider by
Recipient to the extent requested by Provider and which
must be provided in writing if so requested. With re
spect to post-Distribution occurrences for which Provider
is to perform Services as set forth in numbers 25, 26,
27, 28, 31 and 32 on Exhibit A, the parties agree that
Provider shall be under no obligation to perform any (or
any part of) such Services without clear, written in
structions from Recipient. Notwithstanding the fore
going, Provider shall not be required to follow any such
instructions that, in Provider's reasonable judgment, are
inconsistent with the proper performance of its responsi
bilities, or that require the exercise of discretion,
including without limitation the making of decisions
regarding the hiring or firing of employees. The parties
agree that it is their intent that Provider not be deemed
a fiduciary with respect to plans subject to the Employee
Retirement Income Securities Act of 1974, as amended.
2.4 Consents; Indemnification; Assets. (a) If the
provision of any of the Services by Provider to Recipient
would place CFI, Provider or any other subsidiary of CFI
in violation or breach of any contract or license (other
than software licenses, which are addressed in Section
3.1(g) of the Distribution Agreement) between any such
entity and any third party, then Recipient and Provider
shall use their respective commercially reasonable ef
forts, with all costs thereof to be borne by Recipient to
obtain forthwith any consent required for Provider to
provide such Services to Recipient, and Recipient shall
indemnify and hold harmless Provider against all Losses
and Liabilities relating to any claims arising from any
such alleged violation or breach, such indemnification to
be provided in a like manner to the provision of indemni
fication under the Distribution Agreement. If, after the
exercise of such efforts, such consent cannot be ob
tained, Provider shall use commercially reasonable ef
forts to provide Recipient with functionally equivalent
Services with any additional costs required in providing
such Services to be borne by Recipient. Recipient shall
indemnify and hold harmless Provider against all Losses
and Liabilities (including, without limitation, as
relates to software maintenance costs to the extent not
otherwise paid by Recipient as contemplated by Section
2.1) which arise from or in any way relate to (i) the use
of any software or hardware provided by Recipient or (ii)
the use of any software or hardware in connection with
the performance of the Services hereunder provided to
Recipient, such indemnification to be provided in a like
manner to the provision of indemnification under the
Distribution Agreement. The provisions of this Section
1.4(a) shall not alter the agreement of Recipient and
Provider's parent company as provided in Section 3.1(g)
of the Distribution Agreement.
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a) The Service Fees (as defined) to be paid by
Recipient hereunder shall subsume all costs incurred by
Provider in connection with the performance of its
obligations hereunder and in respect of which separate
payment or indemnification by Recipient is not otherwise
contemplated hereby, including, but not limited to, per
sonnel (including fringe benefits and management fees
relating thereto), computer hardware, computer time,
printers, voice and data telecommunications equipment,
file cabinets, paper files, administrative records, photo
copies, incidentals and all other assets owned by
Provider after the Distribution which are needed in
connection with the provision of such Services on a
routine and non-routine basis and during peak and non-
peak periods; and any such equipment may be replaced from
time to time by Provider with functionally equivalent or
upgraded equipment.
b) (i) All data, software or other property or
assets owned or created by Recipient (other than the
intellectual property rights which Recipient has acknowl
edged to be vested in CFI pursuant to Section 3.1(f) of
the Distribution Agreement) shall remain the sole and
exclusive property and responsibility (including, without
limitation, with respect to maintenance, modification and
upgrade) of Recipient. Provider shall not acquire any
rights in any such data, software or other property or
assets, including any derivative works of Recipient-owned
software or data created by Provider, pursuant to this
Agreement or Provider's performance hereunder.
(ii) All data, software or other prop
erty or assets which are owned by Provider, including
without limitation derivative works thereof and new data
or software created by Provider at Provider's sole ex
pense pursuant to the provision of Services ("Provider
Software") shall be the sole and exclusive property and
responsibility (including, without limitation, with
respect to maintenance, modification and upgrade) of Pro
vider and any interest of Recipient therein shall be
limited to the Licensed Materials (as defined in the Dis
tribution Agreement) and the Additional Licenses (as
defined in the Distribution Agreement), if any. Recipi
ent shall not acquire any other rights in any such data,
software or other property or assets pursuant to this
Agreement or Recipient's performance hereunder.
Page 5
c) If as a result of unanticipated events or condi
tions, Recipient reasonably determines that it requires
modification of any of the Services or software used in
connection therewith upon Recipient's request, Provider
shall so modify the Services or software used in connec
tion therewith upon Recipient's request (i) to the extent
commercially reasonable, (ii) to the extent such modifi
cations do not adversely affect Provider's ability to
maintain its computer systems in connection with its
continuing business, and (iii) at Recipient's sole cost
and expense subject to Recipient's approval of Provider's
estimate. Moreover, Provider may suggest modification of
software and may, in its sole discretion, offer to share
in the cost thereof if it determines that any such
modifications may be beneficial to Provider. Recipient
shall have exclusive ownership rights to any software
modifications it pays for solely, and shared rights to
such modifications with respect to which, and only to the
extent that, it shares in the payment therefor.
d) Provider shall provide all support and assistance
reasonably requested by Recipient, at an arm's-length,
negotiated price, in connection with the transfer of any
and all Services from Provider to Recipient or any of its
affiliates or an alternative third-party service provider
selected by Recipient. Specifically, upon the request of
Recipient, during the term of this Agreement, Provider
shall deliver to Recipient (or as directed by Recipient),
at the Recipient's request and with minimal interruption
to the operations of Provider or its affiliates, all data
and programs owned by Recipient or licensed by Recipient
from third party vendors, and all backup or archival
copies thereof (or any part thereof as specified by Recip
ient), in hard copy, electronic, magnetic or any other
form which is then in Provider's possession or control,
as requested by Recipient, and (in the event that this
Agreement is terminated) copies of all material licensed
pursuant to Section 3.1(g) of the Distribution Agreement
by Recipient from Provider (with reasonable instructions
for the installation and use thereof).
Page 6
2.5 Systems Availability and Data
Integrity. Provider shall maintain, consistent with past
practices, operational recovery procedures to insure the
availability of systems and the integrity of data relat
ing to the Services at all times. In the event of the
unavailability of any such systems or the loss or de
struction of any such data, Provider shall use commer
cially reasonable efforts consistent with past practices
to restore such systems and recover or replace such data
as quickly and completely as possible.
2.6 Systems Users. In each case as it relates to
Recipient's employees, consultants, affiliates or autho
rized customers during the term of this Agreement the
addition or deletion of authorized users ("Users"),
including persons authorized at the application-level or
system-level, in regard to any computer system, the modi
fication of computer system authority or access granted
to any person, and the control generally of access to and
use of computer systems, is to be at the direction of
Recipient, and Provider shall permit no changes in such
access or use without prior written notice to and consent
from Recipient. No User will be allowed system authority
or access greater than at the application level without
the prior written consent of Provider. Each party shall
indemnify and hold harmless the other against all degrada
tions in performance levels caused by users authorized
for system level access on behalf of, or at the request
of, such first party, such indemnification to be provided
in a like manner to the provision of indemnification
under the Distribution Agreement.
Page 7
3 PAYMENT FOR SERVICES
3.1 Costs. The prices charged for the Services shall
initially be those set forth in Exhibit A, which have
been negotiated on an arm's-length basis (the "Service
Fees"). The Service Fees shall be adjusted on an arm's-
length basis every 3 months, except that the Service Fees
for the period from the Distribution Date through March
31, 1997 shall be as indicated on Exhibit A and Provider
shall, not less than 3 months before any proposed
adjustment to Service Fees, provide Recipient with de
tails of any proposed adjustment and justification there
for. The Parties shall negotiate in good faith to reach
an agreement within 30 days. Recipient shall not be
charged a fee for any improvements or upgrades to facili
ties or equipment without its prior written consent;
provided, however, that Recipient acknowledges and agrees
that its failure to timely provide any such consent may
adversely affect its abilities to receive Services here
under, and Provider shall not be liable for any harm to
Recipient resulting therefrom. Notwithstanding the
immediately preceding sentence, all maintenance fees
relating to software used in connection with the provi
sion of Services hereunder, and a proportionate share of
all consultants' fees relating to the Year 2000 software
conversion project, shall be billed separately from the
Service Fees and shall be paid by Recipient together
therewith.
3.2 Invoices; Payment Procedures. (a) Not later than
30 days after the end of each calendar month Provider
shall send Recipient an invoice that includes a detailed
breakdown of all Service Fees for such month. All in
voices shall be sent to: Consolidated Freightways Corpo
ration, attention: Controller, mailing address: 000
Xxxxxxxx Xxxxx, Xxxxx Xxxx, XX 00000. All payments of
such invoices shall be made by wire transfer or interbank
transfer in immediately available funds to Provider's
account at such banks as Provider shall designate to
Recipient in writing and shall be made within 15 days
after the date of any invoice.
Page 8
(b) Recipient shall establish and main
tain an account ("Payroll Account") from which Provider
shall be authorized to draw in order to meet Recipient's
gross payroll obligations, and Recipient shall ensure
that such Payroll Account is sufficiently funded at all
times. Notwithstanding any other provision hereof, (i)
Recipient shall reimburse Provider for each payroll paid
by Provider to the employees of the Recipient for the
period contemplated above, to the extent that Provider
elects to provide funds despite a deficiency in the
Payroll Account, and (ii) Recipient shall provide each
such reimbursement by wire transfer of immediately avail
able funds on the day of the issuance of that payroll to
such employees.
3.3 Disputed Fees. In the event that Recipient and
Provider have a good faith dispute with respect to the
amount of payment for Services actually rendered (other
than with respect to the underlying schedule of fees for
Services generally), Recipient shall withhold payment
only of any unpaid amount in dispute, and shall deliver
to Provider promptly (and within 15 days following re
ceipt of any invoice from Provider that is the basis of
such dispute) a written statement describing the dispute,
which statement shall provide a reasonably detailed
breakdown of the disputed payment amounts. The parties
agree to use their best efforts to resolve any such
dispute hereunder within 15 days following Provider's
receipt of Recipient's statement describing the dispute.
In the event the parties cannot resolve the dispute
within such time period, each discrepancy or disagreement
which cannot be so resolved shall be submitted to a firm
of nationally recognized independent certified public ac
countants (agreed upon by Provider and Recipient), who
shall promptly deliver a report setting forth their
calculation of each item that was the subject of discrep
ancy or disagreement, which report shall be final and
binding on the parties. The fees and expenses of such
firm shall be borne one-half by Provider and one-half by
Recipient and each party shall bear its own other expens
es in connection therewith.
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4 TERM; TERMINATION OF SERVICES
4.1 Term. (a) The term of this Agreement shall com
mence on the date hereof and shall continue in effect
until the close of business on the third anniversary of
the date hereof.
a) Notwithstanding anything to the contrary in this
Agreement, the provisions of Articles 5 and 6 and Sec
tions 1.1(c) (solely as relates to indemnification),
1.4(a) (solely as relates to indemnification), 1.6
(solely as relates to indemnification), 4.2, 7.6, 7.7,
7.8, 7.11, 7.12 and 7.13 shall survive any termination of
this Agreement or the provision of Services hereunder.
4.2 Termination of Services. Recipient may at any
time, upon six months' irrevocable written notice to Pro
vider, terminate all the Services or any Service (or any
portion thereof) on a Service by Service basis. Provider
may, at any time after the first anniversary of the date
hereof, terminate any or all of the Services on six
months' irrevocable written notice to Recipient; provid
ed, however, Recipient shall be entitled to continue
receiving the telecommunication and data processing ser
vices through the third anniversary date in its sole
discretion. The provision of all Services pursuant
hereto shall in any event terminate on or prior to the
third anniversary of the date hereof. Upon termination
of any Service, all administrative records (which term is
not to be construed to include Provider Software) relat
ing to that Service as such records relate solely to
Recipient which have not already been transferred to the
sole possession of Recipient shall be so transferred, it
being understood that Provider may retain copies of such
records.
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5 COOPERATION
5.1 Cooperation. Each of the parties shall cooperate
with and provide assistance to the other consistent with
the terms and conditions hereof (including, without
limitation, any limitations relating to software) to
enable (i) the full performance of all obligations here
under, (ii) the review and audit of books and
administrative records as they relate to the provision of
Services, and (iii) Recipient, or any of its affiliates
or third party service provider, to assume the perfor
xxxxx of any and all Services upon termination or prior
thereto; such cooperation and assistance to include
without limitation providing the other party, its repre
sentatives and its agents (including, without limitation,
its outside auditors) with reasonable access, during
normal business hours and upon reasonable advance notice,
to its employees, representatives and agents and its
books, administrative records, offices and properties
relating to the Services. Nothing in this section 4.1
shall operate to grant any right to Recipient of Provider-
owned software, data or other intellectual property.
5.2 Provider Administrative Records. Provider shall
keep administrative records regarding the provision of
Services as LJSC has kept records for itself regarding
such Services prior to the Distribution, and for each
Service shall retain such records for a period of twelve
months following the cessation of Provider's provision of
that Service to Recipient. Recipient, its agents and
representatives shall have reasonable access during
normal business hours and upon reasonable advance notice
to such records (which term is not to be construed to
include Provider Software) from the date hereof through
the end of the period for retaining such records pursuant
to this Section 4.2.
5.3 Periodic Review of Services. From time to time
during the term of this Agreement, but not less
frequently than once each month, the parties shall meet
and discuss the nature, quality, and level of Services
covered by this Agreement, any concerns either party may
have in regard to such matters, and any amendments either
party may wish to make to the Services specified in
Exhibit A.
Page 11
6 FORCE MAJEURE
6.1 Force Majeure. Each party shall be relieved of
its obligations hereunder if and to the extent that any
of the following events or conditions directly or indi
rectly hinder, limit or make impracticable the perfor
xxxxx by that party of any of its obligations hereunder:
Act of God, war, riot, fire, earthquake, explosion,
flood, sabotage, national defense requirement, strike,
lockout, job action, injunction, act or order of a govern
mental agency or instrumentality thereof (whether of fact
or law), act of a public enemy, embargo or other concert
ed act of workers, telecommunications failures or elec
trical failures; provided, that Provider shall continue
to have in place at all times disaster recovery proce
dures consistent with past practices of LJSC regarding
CFCD to enable rapid recovery from any such event or
condition. Such procedures may be subject to revision by
Provider from time to time as may be required in the
ordinary course of business, provided, that such revi
sions do not adversely affect the levels of protection
afforded by such procedures. Prior to being relieved of
any obligations hereunder Provider shall have used com
mercially reasonable efforts (consistent with past prac
tices) to remove or otherwise address the effects of any
such event or condition as soon as practicable. Recip
ient shall be liable for all costs incurred by Provider
in connection with any Service that Provider fails to com
plete and provide as a result of any such event or condi
tion.
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7 CONFIDENTIALITY
7.1 Confidentiality. The parties acknowledge that in
connection with the provision of Services hereunder, each
may gain access to confidential and proprietary informa
tion regarding the other's financial and business affairs
(hereinafter "Confidential Information" or "Informa
tion"). Each party hereby agrees to use commercially rea
sonable efforts to:
a) confine its access to and examination of Confiden
tial Information to the minimum Information necessary to
enable Provider to provide the Services hereunder and
Recipient to operate its business;
b) limit access to such Information only to those
individuals who reasonably need to receive such access to
enable Provider to provide the Services hereunder and
Recipient to operate its business;
c) inform such individuals of the confidential
nature of such Information and take all reasonable steps
to secure the compliance of such individuals with the
terms of this Article 6;
d) use such Information solely to enable Provider to
provide the Services hereunder and Recipient to operate
its business;
e) keep such Information confidential and not
disclose it to any third party in any manner except as
may be required by law or court order; and
Page 13
f) provide the other party with reasonable access to
that party's employees, representatives and agents and
its books and administrative records relating to the
relevant business (including, without limitation, any and
all computer access reports and security access reports)
in order for the other party to monitor compliance with
this Article 6.
Notwithstanding the foregoing, disclosures of
Information may be made to third parties: (i) with the
prior written consent of the party whose Information it
is, (ii) if the Information is in the public domain and
has entered the public domain through no fault of the
party seeking to make such disclosure or its affiliates
or representatives, (iii) if the Information is lawfully
acquired by the party seeking to make such disclosure or
its affiliates or representatives from sources other than
the party whose Information it is or its affiliates or
representatives and none of the party seeking to make
such disclosure, its affiliates or its representatives is
aware that such source was under any obligation (whether
contractual, legal or fiduciary) to the party whose
Information it is or any of its affiliates or representa
tives to keep such Information confidential or (iv) to
the extent disclosure is compelled by law or court order.
Each party shall be responsible for any breach of this
Article 6 caused by itself or any of its employees,
agents or representatives. Anything contained herein to
the contrary notwithstanding, the parties acknowledge and
agree that irreparable damage would occur in the event
that any provision of this Article 6 was not performed in
accordance with its terms, and that the parties shall be
entitled to specific performance as the sole remedy.
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8 MISCELLANEOUS
8.1 Notices. All notices, requests, demands, con
sents, waivers and other communications required or
permitted to be given under this Agreement (excluding
invoices as described in Section 2.2 above) shall be in
writing and may be given by any of the following methods:
(a) personal delivery; (b) facsimile transmission; (c)
registered or certified mail, postage prepaid, return
receipt requested; or (d) overnight delivery service.
Notices shall be sent to the appropriate party at its
address or facsimile number given below (or at such other
address or facsimile number for such party or other
person as shall be specified by notice given hereunder):
If to Provider to:
CNF Service Company, Inc.
0000 X.X. 00xx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Controller
Fax No.:
with a copy to:
Consolidated Freightways, Inc.
0000 Xxxxxxxx Xxxxxx
Xxxx Xxxx, XX 00000
Attention: General Counsel
Fax No.: (000) 000-0000
If to Recipient to:
Consolidated Freightways Corporation
000 Xxxxxxxx Xxxxx
Xxxxx Xxxx, XX 00000
Attention: General Counsel
Fax No.:
All such notices, requests, demands, waivers
and communications shall be deemed received upon (i)
actual receipt thereof by the addressee or (ii) actual
delivery thereof to the appropriate address.
Page 15
8.2 Severability. Should any provision of this Agree
ment for any reason be declared invalid or unenforceable,
such declaration shall not affect the validity or en
forceability of any of the other provisions of this Agree
ment, which other provisions shall remain in full force
and effect and the application of such invalid or
unenforceable provision to persons or circumstances other
than those as to which it has been held invalid or unen
forceable shall be valid and enforced to the fullest
extent permitted by law.
8.3 Binding Effect; Assignment. This Agreement and
all of the provisions hereof shall be binding upon and
shall inure to the benefit of the parties hereto and
their respective successors and permitted assigns. Nei
ther this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned, directly or
indirectly, including, without limitation, by operation
of law, by any party hereto without the prior written con
sent of the other party hereto; provided, (i) that either
of the parties hereto may without such prior written
consent transfer or assign its rights hereunder to one or
more of its affiliates, but no such transfer arrangement
shall release the transferring party of its obligations
hereunder and (ii) that Provider may subcontract to any
party so long as Provider remains liable for the
performance of Services provided by any such subcon
tractor.
8.4 No Third Party Beneficiaries. This Agreement is
solely for the benefit of the parties and their respec
tive successors and permitted assigns, and shall not be
deemed to confer upon or give to any other party any
remedy, claim, liability, reimbursement, cause of action
or other right.
8.5 Interpretation. The section headings contained in
this Agreement are solely for the purpose of reference,
are not part of the agreement of the parties and shall
not in any way affect the meaning or interpretation of
this Agreement.
Page 16
8.6 Jurisdiction and Consent to Service. In accor
dance with the laws of the State of Oregon, and without
limiting the jurisdiction or venue of any other court,
the parties (a) agree that any suit, action or proceeding
arising out of or relating to this Agreement (other than
proceedings arising under Section 2.3 above with respect
to the amount of payment for Services) shall be brought
solely in the state or federal courts of Oregon; (b) con
sent to the exclusive jurisdiction of each such court in
any suit, action or proceeding relating to or arising out
of this Agreement; (c) waive any objection which any of
them may have to the laying of venue in any such suit,
action or proceeding in any such court; and (d) agree
that service of any court paper may be made in any manner
as may be provided under the applicable laws or court
rules governing service of process in such court.
8.7 Entire Agreement. This Agreement constitutes the
entire agreement among the parties with respect to the
subject matter hereof, and supersedes all other prior
agreements and understandings, both written and oral,
between the parties with respect to the subject matter
hereof. Any conflicts between the language herein and
the language used in the Distribution Agreement shall be
resolved in favor of the language used herein.
8.8 Governing Law. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF OREGON (REGARDLESS OF THE LAWS THAT MIGHT OTHERWISE
GOVERN UNDER APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS
THEREOF) AS TO ALL MATTERS, INCLUDING BUT NOT LIMITED TO
MATTERS OF VALIDITY, CONSTRUCTION, EFFECT, PERFORMANCE
AND REMEDIES.
8.9 Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an
original, but all of which shall constitute one and the
same agreement.
Page 17
8.10 Relationship of the Parties. Provider and
Recipient each acknowledge that they are separate enti
ties, each of which has entered into this Agreement for
independent business reasons. Except as provided below
in this Section 7.10, the relationship of Provider to
Recipient hereunder is that of an independent contractor
and nothing herein shall be deemed or construed to create
a relationship of partnership, employment, agency, joint
venture, or any other relationship. Except as provided
below in this Section 7.10, neither party shall transact
any business in the name of the other party or obligate
or commit the other party in any manner. In recognition
of the fact that some of the Services to be provided by
Provider pursuant to this Agreement will require that
personnel employed by Provider engage in business deal
ings with customers, vendors, or others with whom Recipi
ent does business and that it is to Recipient's advantage
for such business dealings to be conducted on behalf of
and in the name of Recipient, Recipient may authorize
Provider to use any of its names, whenever (a) necessary
or appropriate in providing Services or other assistance
hereunder and (b) Recipient explicitly so instructs
Provider, in writing. Recipient shall indemnify and hold
harmless Provider against all Losses and Liabilities
incurred by Provider and arising from this Section 7.10,
such indemnification to be provided in a like manner to
the provision of indemnification under the Distribution
Agreement.
8.11 Waiver. Any failure by either party to comply
with any obligation, covenant or agreement herein or to
fulfill any condition herein may be waived only by a
written notice from the party entitled to the benefits
thereof. No failure by either party hereto to exercise,
and no delay in exercising, any right hereunder shall
operate as a waiver thereof, nor shall any single or
partial exercise of any right hereunder preclude any
other or future exercise of that right or any other right
hereunder by that party.
Page 18
8.12 Sole Remedy; No Damages. If Recipient becomes
dissatisfied with the quality or level of Services
provided hereunder, claims any breach of this Agreement
by Provider or otherwise becomes dissatisfied with any
matter relating hereto or arising herefrom, its sole
remedy shall be termination of all or a part of the
Services without right to seek actual, compensatory or
consequential damages. RECIPIENT HEREBY ACKNOWLEDGES AND
AGREES THAT IT IS HEREBY WAIVING CERTAIN LEGAL RIGHTS AND
REMEDIES, AND THAT THIS WAIVER IS A FUNDAMENTAL ELEMENT
OF THE BARGAIN BETWEEN THE PARTIES HERETO, WITHOUT WHICH
PROVIDER WOULD NOT HAVE ENTERED INTO THIS AGREEMENT.
RECIPIENT HEREBY ACKNOWLEDGES AND AGREES FURTHER THAT,
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HERE
IN, PROVIDER MAY, BUT SHALL IN NO EVENT BE OBLIGATED TO,
ADVANCE FUNDS OR INCUR COSTS IN CONNECTION WITH ITS
PERFORMANCE HEREUNDER.
Indemnification. Recipient, at its own expense, shall
indemnify, defend and hold Provider, its subsidiaries and
their present or former officers, directors,
shareholders, agents, employees, representatives,
successors-in-interest, parents, affiliates, insurers,
attorneys and assigns (collectively, the "Indemnified
Parties") harmless from and against any claims,
judgments, losses, deficiencies, damages, punitive or
exemplary damages, fines or penalties, liabilities, costs
and expenses (including reasonable attorneys' fees,
charges and disbursements) whether required to be paid to
a third party or otherwise incurred in connection with or
arising from any claim, suit, action or proceeding
("Claim") against the Indemnified Party to the extent the
basis of such Claim is that: (i) Recipient has failed to
pay any amounts owed to third parties in connection with
the Services provided by Provider under this Agreement;
(ii) a third party has been or may be injured or damaged
in any way by any breach of Recipient of any of its
duties, representations or warranties under this Agree
ment; (iii) Recipient or any of its employees, agents, or
services acted improperly in connection with the notifi
cation, investigation, adjustment or settlement of claims
and losses arising out of the Services described in
Exhibit A, and (iv) there is any other liability or
obligation arising out of Provider's administration or
operation of the Services or functions described in
Exhibit A, except to the extent that same arises from the
gross negligence or willful misconduct of Provider. The
provision of indemnification under this Section 7.13
shall be in a like manner to the provision of indemnifi
cation under the Distribution Agreement.
Page 19
IN WITNESS WHEREOF, the parties have each
caused this Agreement to be executed by its duly autho
rized representative as of the day and year first above
written.
CNF SERVICE COMPANY, INC.,
on behalf of itself and its
wholly owned subsidiaries
By:/s/ X. X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: President and Chief
Executive Officer
CONSOLIDATED FREIGHTWAYS
CORPORATION,
on behalf of itself and its
wholly owned subsidiaries
By:/s/ S. D. Xxxxxxxx
Name: Xxxxxxx X. Xxxxxxxx
Title: Senior Vice Presi-
dent and General Counsel
Page 20
