EXHIBIT 4.23
TRANSITION SERVICES AGREEMENT
THIS TRANSITION SERVICES AGREEMENT (this "AGREEMENT") is executed this 15
day of February, 2010 (the "EFFECTIVE DATE"), by and among LANTIQ ISRAEL LTD., a
private company organized under the laws of the State of Israel ("BUYER"), and
METALINK LTD., a public company organized under the laws of the State of Israel
("SELLER").
RECITALS
A. The parties have entered into that certain Asset Purchase Agreement
dated January 5, 2010 (the "PURCHASE AGREEMENT"; capitalized terms used but not
defined herein shall have the respective meanings ascribed thereto in the
Purchase Agreement), whereby Seller transferred certain assets and liabilities
to Buyer and Buyer acquired and assumed such assets and liabilities as set forth
therein.
B. It is a condition to the Closing of the Purchase Agreement that the
parties enter into this Agreement.
C. Seller desires to receive the Services (as defined below) from Buyer,
and Buyer is willing to provide Seller with the Services, all subject to the
terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the covenants, promises,
representations and warranties set forth herein, and intending to be legally
bound hereby, the parties agree as follows:
1. SERVICES.
1.1 Subject to the terms and conditions set forth in this Agreement, Buyer
will provide, or cause to be provided, to Seller with certain services, all as
detailed in EXHIBIT A attached hereto (which Exhibit shall be incorporated by
reference into this Agreement) (the "SERVICES").
1.2 The Services shall be provided by Buyer pursuant to the requirements
(including instructions, terms, conditions, time-tables, locations and other
terms, to the extent specified) as set forth in this Agreement or as may be
agreed, modified or supplemented from time to time following the date hereof by
mutual written consent of the parties. If during the Term (as defined below),
Buyer relocates from an office in which Buyer is sharing space with Seller, the
parties undertake to negotiate in good faith an agreed-upon solution that will
allow Buyer to continue providing the Services to Seller on substantially the
same terms and conditions.
1.3 Without derogating from the foregoing, the parties agree that, at the
Seller's request, Exhibit A shall be supplemented (which supplements shall be an
integral part of this Agreement) to add technical services of similar nature of
the Services that are required by Seller to continue to conduct its business in
substantially the same manner it shall be conducted immediately following the
Closing; provided that are incidental to Buyer's operation of the Business; and
further provided that if time consuming or otherwise not negligible in costs,
Buyer may condition the same by a reasonable increase of the Consideration.
2. CONSIDERATION; TERMS OF PAYMENT.
2.1 In consideration for the provision of the Services hereunder, Seller
shall pay Buyer on the first business day of each calendar month, in respect of
such month, an amount of US $1,560 per each person employed by Seller on such
day, but not more than US $9,360 per month in the aggregate (the
"CONSIDERATION").
2.2 Unless otherwise agreed by the parties, all payments made under this
Agreement shall be in NIS, according to the applicable 'HASHA'AR HAYATZIG' for
US Dollars on the date of payment.
2.3 The Consideration is inclusive of any taxes, fees, and duties or other
amounts, however designated, but excludes VAT and withholding taxes that are
levied or based upon such charges, or upon this Agreement, and each of the
parties shall be responsible for its respective tax, fee, duty, and other such
obligations unless otherwise agreed in writing. Seller shall be entitled to
withhold from payments any and all amounts as may be required from time to time
under applicable law, unless it receives from Buyer a certificate or ruling from
the Israeli Tax Authority providing for an exemption or other reduction from
such withholding or deduction which can clearly be relied upon by Seller and
which is presented at least seven days prior to the time that the applicable
payment of consideration is due to be made.
4. CERTAIN COVENANTS.
4.1 CONTACT PERSONS. Seller and Buyer shall each name an individual to
serve as its respective point of contact. Such individuals shall be responsible
for the implementation of this Agreement between Seller and Buyer, including
resolution of any issues that may arise during the performance hereunder on a
day-to-day basis. Such individuals shall meet at least once each calendar
quarter throughout the Term and otherwise as reasonably requested by a party to
review the performance of the parties hereunder. The initial contact person of
(i) Seller shall be ______________, Tel: ________, Email:__________; and (ii)
Buyer shall be______________, Tel: ________, Email:__________.
4.2 DATA PROTECTION. Buyer shall take reasonable measures to protect
Seller's data that are processed by Buyer from unauthorized destruction,
deletion, change or disclosure to third parties, and to allow recovery of such
data in events of force majeure.
5. CONFIDENTIALITY; OWNERSHIP.
5.1 Without derogating from Seller's obligations under the Purchase
Agreement, each party agrees to maintain as confidential and not to disclose to
any third party any and all Confidential Information (as defined below) of the
other party. However, nothing herein will be deemed to prevent the receiving
party from disclosing any Confidential Information received hereunder (i) to any
of its affiliates, employees and advisors who have a need to know such
information for the purpose of providing the Services hereunder or (ii) pursuant
to any applicable law, regulation or court order; provided that such receiving
party will immediately notify the disclosing party of such required disclosure
and shall use its reasonable commercial efforts to minimize or prevent such
disclosure to the maximum extent allowed under any such applicable law,
regulation or court order.
5.2 Buyer acknowledges that it will acquire no right, title or interest
(including any license rights or rights of use) in any firmware or software or
Confidential Information owned by Seller. Buyer also acknowledges that, while it
may continue to have access to databases existing on or accessible through the
computer systems of Seller, Buyer will acquire no right, title or interest
(including any license rights or rights of use) to any such databases, except to
the extent expressly licensed by Seller to Buyer. Buyer acknowledges that the
information contained in all such databases, including information regarding
clients of Seller, shall be treated as Confidential Information of Seller
hereunder. For the avoidance of doubt, nothing herein shall derogate from any
right, title or interest of Buyer under any other agreement between Buyer and
Seller.
5.3 Seller acknowledges that it will acquire no right, title or interest
(including any license rights or rights of use) in any firmware or software or
Confidential Information owned by Buyer, and the licenses therefor for which
Buyer is a party, by reason of Seller's use or access thereto in connection with
the provision of the Services provided hereunder. Seller also acknowledges that
it will acquire no right, title or interest (including any license rights or
rights of use) to any databases existing on or accessible through the computer
systems of Buyer, except to the extent expressly licensed by Buyer to Seller.
Seller acknowledges that the information contained in all such databases shall
be treated as Confidential Information of Buyer hereunder. For the avoidance of
doubt, nothing herein shall derogate from any right, title or interest of Seller
under any other agreement between Buyer and Seller.
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5.4 "CONFIDENTIAL INFORMATION" shall mean all information which is labeled
or marked "Confidential" or with some other similar proprietary legend or which
is reasonably understood to be confidential or proprietary, including, without
limitation, any trade secret, information, process, technique, algorithm,
computer program (source and object code), design, drawing, formula or test data
relating to any research project, work in process, future development,
engineering, manufacturing, marketing, servicing, financing or personnel matter
relating to the disclosing party, its present or future products, sales,
suppliers, clients, customers, employees, investors or business, whether in
oral, written, graphic or electronic form. The term Confidential Information
will not, however, include information which (i) is or becomes publicly
available other than as a result of a breach by the receiving party or its
representatives of the obligations hereunder; (ii) is or becomes available to
the receiving party on a non-confidential basis from a source (other than the
disclosing party or its representatives) which, to the best of the receiving
party's knowledge, is not prohibited from disclosing such information by a
legal, contractual or fiduciary obligation to the disclosing party; or (iii) was
independently developed by the receiving party. Without derogating from the
generality of the foregoing, Buyer's "Confidential Information" shall be deemed
to include the "Confidential Information", as such term is defined in the
Purchase Agreement, and Seller's "Confidential Information" shall be deemed to
exclude the "Confidential Information", as such term is defined in the Purchase
Agreement.
6. TERM; TERMINATION.
6.1 This Agreement shall remain in effect for a term of twelve (12) months
from the Effective Date (the "INITIAL TERM"); provided, however, that if Seller
requires the provision of any Services after the expiration of the Initial Term,
then Seller shall have the right to extend the Initial Term for up to additional
twelve (12) months (collectively with the Initial Term, the "TERM") by providing
Buyer with written notice at least 30 days prior to the expiration of the
Initial Term.
6.2 Unless otherwise expressly stated in the applicable Exhibit A with
respect to a specific service, Seller shall have the right to terminate all or
any part of any Service to be provided under this Agreement at any time during
the Term by providing to Buyer with at least 30 days prior written notice.
6.3 In addition, this Agreement may be terminated in the following events:
(a) either party hereto may terminate this Agreement if the other party commits
a material breach of this Agreement and fails to remedy such breach within ten
(10) days after receipt of written notice of such breach, (b) this Agreement may
be terminated by Seller upon the provision of thirty (30) days written notice,
(c) this Agreement may be terminated by Buyer, upon written notice of a breach
by Seller of any of its covenants under Sections 8.1 and 8.2 of the Purchase
Agreement, and (ii) if, notwithstanding Section 1.2 above, the parties fail to
reach a solution for sharing an office space, and (d) this Agreement may be
immediately terminated by either party by written notice upon (i) the other
party's voluntary or involuntary bankruptcy, receivership or commencement of a
similar insolvency proceeding which is not removed within ninety (90) days; or
(ii) the other party's election to dissolve or wind-up business.
6.4 Upon the termination, cancellation or expiration of this Agreement for
any reason, neither party shall be relieved of its duty to discharge in full all
accrued, liquidated and due sums owed by either party to the other, which sums
shall become immediately due and payable on the date of termination,
cancellation or expiration. In addition, the respective rights, obligations and
duties of the parties under Sections 4.2, 5, 6, 7 and 8, as well as any rights,
obligations and duties which by their nature extend beyond the termination,
cancellation or expiration of this Agreement, shall survive any termination,
cancellation or expiration hereof.
7. RELATIONSHIP OF THE PARTIES. Each of the parties shall at all times during
the term of this Agreement be considered, act as, and shall represent itself to
be, an independent contractor, and not an agent or employee of the other. No
employment relationship shall exist or be construed to exist between either of
the parties, on the one hand, and the employees of the other party, on the other
hand. Except as expressly provided for herein or in another written agreement,
neither of the parties shall be authorized to bind, commit or assume any
obligations on behalf of the other party, without the other party's prior
written consent. In the event that any court or tribunal shall determine that
notwithstanding the parties' mutual understanding, as described in this
Agreement, Buyer or any of its employees is considered an employee of Seller,
Section 5.2 of the Consulting Services Agreement shall apply, MUTATIS MUTANDIS.
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8. MISCELLANEOUS.
8.1 NOTICES. Any notice or other communication required or permitted to be
delivered to any party under this Agreement shall be in writing and shall be
deemed properly delivered, given and received when delivered (by hand, by
registered mail, by courier or express delivery service or by facsimile) to the
address or facsimile telephone number set forth beneath the name of such party
below (or to such other address or facsimile telephone number as such party
shall have specified in a written notice given to the other parties hereto):
IF TO BUYER:
Lantiq Israel Ltd.
[_________]
[_________]
Israel
Fax: [____________]
Attention: [_______________]
with a copy to (which shall not constitute notice):
Golden Gate Capital
Xxx Xxxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Fax: 000-000-0000
Attention: Xxxx Xxxxx and Xxxxx Xx
Xxxxxxxx and Xxxxx, LLP
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Fax: 000-000-0000
Attention: Xxxxxxx Xxxxxx
Meitar Liquornik Geva & Leshem Xxxxxxxxx, Law Officers
00 Xxxx Xxxxxx Xx.
Xxxxx Xxx 00000, Israel
Fax: 000-0-0000000
Attention: Xxxx Xxxxxxxxx
IF TO SELLER:
Metalink Ltd.
Xxxxx Xxxxxxxx Xxxx
Xxxxx 00000, Xxxxxx
Fax: x000-0-0000000
Attention: Chief Executive Officer
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with a copy to (which shall not constitute notice):
Goldfarb, Levy, Xxxx Xxxxx, Tzafrir & Co.
0 Xxxxxxxx Xxxxxx
Xxx-Xxxx 00000, Xxxxxx
Fax: 000-0-000-0000
Attention: Xxx Xxxxxx, Adv.
or such other address with respect to a party as such party shall
notify each other party in writing as above provided. Any notice
sent in accordance with this Section 13.1 shall be effective (i) if
mailed, five (5) business days after mailing, (ii) if sent by
messenger, upon delivery, and (iii) if sent via telecopier, upon
transmission and electronic confirmation of receipt or (if
transmitted and received on a non-business day) on the first
business day following transmission and electronic confirmation of
receipt.
8.2 COUNTERPARTS. This Agreement may be executed in one or more
counterparts (including by means of telecopied, facsimile or portable data
format (PDF) signature pages), 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, it being
understood that all parties need not sign the same counterpart.
8.3 GOVERNING LAW; VENUE. This Agreement shall be governed by and
construed exclusively in accordance with the laws of the State of Israel,
regardless of the laws that might otherwise govern under applicable principles
of conflicts of laws thereof. Each party hereby irrevocably submits to the
exclusive jurisdiction of the courts sitting in the City of Tel-Aviv for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is improper or inconvenient venue for such
proceeding. Each party hereby irrevocably waives personal service of process and
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof via registered or certified mail or overnight delivery
(with evidence of delivery) to such party at the address in effect for notices
to it under this Agreement and agrees that such service shall constitute good
and sufficient service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in any manner
permitted by law.
8.4 AMENDMENT. This Agreement may be amended by the parties hereto at any
time by execution of an instrument in writing signed on behalf of each of the
parties hereto.
8.5 EXTENSION; WAIVER. No failure on the part of any person to exercise
any power, right, privilege or remedy under this Agreement, and no delay on the
part of any person in exercising any power, right, privilege or remedy under
this Agreement, shall operate as a waiver of such power, right, privilege or
remedy; and no single or partial exercise of any such power, right, privilege or
remedy shall preclude any other or further exercise thereof or of any other
power, right, privilege or remedy. No person shall be deemed to have waived any
claim arising out of this Agreement, or any power, right, privilege or remedy
under this Agreement, unless the waiver of such claim, power, right, privilege
or remedy is expressly set forth in a written instrument duly executed and
delivered on behalf of such person; and any such waiver shall not be applicable
or have any effect except in the specific instance in which it is given.
8.6 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors and
assigns (if any). Neither party may assign any of its rights under this
Agreement to any other person without obtaining the consent or approval of the
other parties hereto, except that Buyer may assign its rights and obligations
under this Agreement, at any time, to any of its Affiliates.
[SIGNATURES APPEAR ON THE FOLLOWING PAGE]
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IN WITNESS WHEREOF, the parties hereto have caused this Transition
Services Agreement to be executed and delivered as of the date first above
written.
BUYER:
LANTIQ ISRAEL LTD.
By: ________________
Name:
Title:
SELLER:
METALINK LTD.
By: ________________
Name:
Title:
