EXHIBIT 10.3
INTERCORPORATE SERVICES AGREEMENT
This INTERCORPORATE SERVICES AGREEMENT (the "Agreement") is made
effective as of January 1, 2002, by and between Titanium Metals Corporation
("TIMET"), a Delaware corporation, and NL Industries, Inc. ("NL"), a New Jersey
corporation.
WHEREAS, TIMET desires that NL provide certain tax services and use of
NL's corporate aircraft to TIMET, as set forth in this Agreement.
NOW, THEREFORE, in consideration of the premises and promises set forth
herein and for other good and valuable consideration the receipt and sufficiency
of which is hereby acknowledged, the parties to this Agreement agree as follows:
1. Services Provided. NL will make available to TIMET and its
subsidiaries the following services (the "Services"):
(a) consultation and assistance in tax management and
administration, including, without limitation, preparation
and filing of tax returns, tax reporting, examinations by
government authorities and tax planning;
(b) use of corporate aircraft.
2. Fees for Services and Reimbursement of Expenses. During the Term (as
defined below) of the Agreement, TIMET shall pay to NL an annual fee of $250,150
for the Services described in paragraph 1(a) above payable in quarterly
installments of $62,537 plus all out-of-pocket expenses incurred in connection
with the performance of such Services. Regarding Services described in Paragraph
1(b), TIMET will pay to NL within thirty (30) days after receipt of an invoice
an amount equal to TIMET's share of NL's corporate aircraft expenses which
includes TIMET's share of the monthly management fee (computed on a per hour
basis) and actual flight hour costs at a rate of $1,911 per hour (subject to
annual escalation) plus fuel variable charges, segment fees and excise taxes.
Notwithstanding the foregoing, in the event that TIMET determines, in its sole
discretion, that it no longer desires certain of the Services or NL determines,
in its sole discretion, that it no longer desires to provide certain of the
Services, then TIMET or NL, as appropriate, shall provide the other party with a
thirty (30) day prior written notice of cancellation describing the Services to
be terminated or discontinued and TIMET and NL during such ninety-day period
shall agree to a pro-rata reduction of the fees due hereunder for such
terminated or discontinued Services.
3. Limitation of Liability. In providing Services hereunder, NL shall
have a duty to act, and to cause its agents to act, in a reasonably prudent
manner, but neither NL nor any officer, director, employee or agent of NL shall
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be liable to TIMET or its subsidiaries for any error of judgment or mistake of
law or for any loss incurred by TIMET or its subsidiaries in connection with the
matters to which this Agreement relates, except a loss resulting from willful
misfeasance, bad faith or gross negligence on the part of NL or from NL's
reckless disregard of obligations and duties under this Agreement.
4. Indemnification of NL by TIMET. TIMET shall indemnify and hold
harmless NL, its subsidiaries and their respective officers, directors and
employees from and against any and all losses, liabilities, claims, damages,
costs and expenses (including reasonable attorneys' fees and other expenses of
litigation) to which such party may become subject arising out of the provision
by NL to TIMET and its subsidiaries of any of the Services, provided that such
indemnity shall not protect any such party against any liability to which such
person would otherwise be subject by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of obligations and duties hereunder.
5. Further Assurance. Each of the parties will make, execute,
acknowledge and deliver such other instruments and documents, and take all such
other actions, as the other party may reasonably request and as may reasonably
by required in order to effectuate the purposes of this Agreement and to carry
out the terms hereof.
6. Notices. All communications hereunder shall be in writing and shall
be addressed to:
If to NL: NL Industries, Inc.
00000 Xxxxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: General Counsel
If to TIMET: Titanium Metals Corporation
0000 Xxxxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attention: General Counsel
or such other address as the parties shall have specified in
writing.
7. Amendment and Modification. Neither this Agreement nor any item
hereof may be changed, waived, discharged or erminated other than by agreement
in writing signed by the parties hereto.
8. Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the respective successors and assigns of the parties hereto,
provided that this Agreement may not be assigned by either of the parties hereto
without the prior written consent of the other party.
9. Miscellaneous. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. This Agreement constitutes the entire
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agreement, and supersedes all prior agreements and understandings, both written
and oral, between the parties with respect to the subject matter hereof. This
Agreement may be executed in one or more counterparts, each of which shall be
deemed an original, and all of which together shall constitute one and the same
instrument. This Agreement shall be governed in all respects, including
validity, interpretation and affect, by the laws of the State of Texas.
10. Term of Agreement. This Agreement shall be effective as of January
1, 2002, and shall remain in effect for a term of one year until December 31,
2002 (the "Term"); provided, however, the Agreement shall be extended on a
quarter-to-quarter basis after the expiration of the Term unless written
notification is given by either party thirty (30) days in advance of the first
day of each successive quarter or unless it is terminated or superseded by a
subsequent written agreement of the parties hereto. Upon such termination or
upon the expiration of this Agreement, the parties' rights and obligations
hereunder shall cease and terminate except with respect to rights and
obligations arising on or prior to the date of expiration or termination and the
rights and obligations arising under paragraph 4 above.
11. Confidentiality. Except as otherwise required by applicable law,
each of the parties agrees that it will maintain in confidence all confidential
information regarding the other party supplied to it in the course of the
performance of this Agreement.
IN WITNESS WHEREOF, the parties have duly executed this Agreement
effective as of the 8th day of May, 2002, which Agreement will be deemed to be
effective as of January 1, 2002.
NL INDUSTRIES, INC.
By:/s/ Xxxxxx X. Xxxxx
------------------------------------
Xxxxxx X. Xxxxx
Vice President
TITANIUM METALS CORPORATION
By:/s/ Xxxx X. Xxxxxxx
------------------------------------
Xxxx X. Xxxxxxx
Executive Vice President
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