EXHIBIT 10.1
FORM OF TRANSITION SERVICES AGREEMENT
-------------------------------------
THIS IS A TRANSITION SERVICES AGREEMENT, dated as of March ___, 1998
(the AGREEMENT), between Xxxxxxxx Soup Company, a New Jersey corporation
(SUPPLIER), and Vlasic Foods International Inc., a New Jersey corporation
(BUYER).
Background
----------
A. Pursuant to a Separation and Distribution Agreement, dated as of
March ___, 1998 (the DISTRIBUTION AGREEMENT), Supplier will distribute the stock
of Buyer to Supplier's shareowners (the DISTRIBUTION), following which
Distribution each of Supplier and Buyer will continue in existence as
independent, publicly-traded companies.
B. This Agreement is entered into pursuant to the Distribution
Agreement. The parties wish to set forth the terms on which Supplier will, for
a limited period, provide certain transition services to, and permit the use of
certain of its assets by, Buyer following the Distribution referred to above.
C. Capitalized terms used herein, unless otherwise defined herein,
shall have the meanings assigned to them in the Distribution Agreement.
Terms
-----
THEREFORE, in consideration of the respective agreements and covenants
contained in this Agreement, and intending to be legally bound hereby, the
parties agree as follows:
SECTION 1. SERVICES. (a) Subject to the terms of this Agreement, Supplier
shall provide, or shall cause another member of the CSC Group to provide, the
services described on Exhibit A to Buyer, or another member of the Spinco Group
designated by Buyer, from and after the Distribution Date and during the time
period set forth in Section 2. Supplier (or such other member of the CSC Group)
shall supply such services substantially in accordance with Supplier's normal
practices in providing such services as of the Distribution Date (except as
otherwise provided in Exhibit A).
(b) In consideration for the Services, Buyer shall pay to Supplier
amounts set forth on Exhibit A. Supplier shall invoice Buyer on a monthly basis
for the Services provided to Buyer. All such invoices shall be due within
thirty days after receipt.
(c) Supplier and Buyer agree to cooperate and to make all reasonable
efforts to work together to take such actions as are reasonably necessary to
eliminate the need for or to otherwise discontinue as expeditiously as
reasonably possible the Services performed under this Agreement.
(d) Supplier shall be permitted to cause third parties to provide
Services to Buyer hereunder (in lieu of Supplier or a member of the CSC Group)
so long as Supplier remains fully responsible for the performance by such third
party of such Services in compliance with all the terms and provisions of this
Agreement.
(e) To the extent Exhibit A calls for any services to be provided by
Buyer to Supplier, such services shall be supplied in accordance with the terms
and provisions of this Agreement, except that Vlasic Foods International Inc.
shall be deemed to be the "Supplier" and Xxxxxxxx Soup Company shall be deemed
to be the "Buyer."
SECTION 2. TERM. The term of this Agreement shall be a period of 12 months,
commencing on the Distribution Date and ending on March 29, 1999; provided,
however, that Buyer may terminate any of the Services provided hereunder on not
less than 30 days prior written notice to Supplier, unless otherwise indicated
on Exhibit A. The parties may extend the term of this Agreement by written
agreement signed by both parties. Notwithstanding the foregoing, if (i) either
party fails to perform any material provision of this Agreement and the failure
to perform is not corrected within 15 days after the other party gives written
notice of such default or (ii) Buyer fails to make any payment required under
this Agreement at the time it is due and such failure is not corrected within
five days after written notice of such failure, then the non-defaulting party
may terminate this Agreement.
SECTION 3. STANDARD OF CONDUCT; LIMITATION OF LIABILITY. (a) Supplier shall
have no liability with respect to its furnishing any of the Services hereunder
to Buyer except on account of Supplier's willful misconduct or gross negligence.
In agreeing to provide the Services as an accommodation to Buyer, Supplier is
not making any representation or warranty as to the quality, suitability or
adequacy of the Services for any purpose or use. In providing the Services,
Supplier shall not be obligated to (i) hire any additional employees, (ii)
maintain the employment of any specific employee, or (iii) purchase, lease or
license any additional equipment or software; provided, however, that at the
request of Buyer, Supplier agrees to use reasonable diligence to correct errors
or deficiencies in the Services.
(b) It is understood and agreed that Supplier shall not be obligated
to perform or to cause to be performed any services hereunder in a volume or
quantity which substantially exceeds the historical volumes or quantities of
such services performed for Buyer or other members of the Spinco Group. The
parties further acknowledge that it is Buyer's intention to provide, or procure
the services to be provided by Supplier hereunder from third parties other than
Supplier, as promptly as is reasonably practicable following the Distribution
Date. Supplier will not be required to perform or to cause to be performed any
of the Services for the benefit of any third party or any other entity other
than Buyer or any directly or indirectly wholly owned subsidiary or majority
owned affiliate of Buyer.
(c) Supplier's maximum liability to, and the sole remedy of, Buyer
for breach of this Agreement shall be the greater of (i) Buyer's incremental
out-of-pocket cost of performing such service itself or (ii) Buyer's incremental
out-of-pocket cost of obtaining such service from a third party; provided, that
Buyer shall exercise all reasonable efforts under the circumstances to
-2-
minimize the cost of any such alternatives to such services by selecting the
most cost-effective alternatives which provide the functional equivalent of the
services replaced. Notwithstanding anything to the contrary herein, (i) in no
event shall Supplier have any liability to Buyer for special or consequential
damages under this Agreement, including as a result of Supplier's breach of this
Agreement or the gross negligence or willful misconduct of Supplier under this
Agreement, and (ii) in no event shall Supplier have any liability of any kind
under this Agreement to any third party.
(d) Except as otherwise provided in the foregoing paragraphs (a)-(c)
of this Section 3, Buyer shall be solely liable and responsible for, and shall
indemnify Supplier and its directors, officers, employees and affiliates from,
any and all claims, liabilities, obligations, losses, costs, expenses,
litigation, proceedings, taxes, assessments, charges, demands, damages or
judgments of any kind or nature whatsoever (LOSSES) for acts or omissions in
furnishing Services to Buyer under this Agreement. Upon termination of this
Agreement or their earlier termination of any Services, Buyer shall be obligated
to return to Supplier, as soon as is reasonably practicable, any equipment or
other property of Supplier relating to the Services which is in Buyer's control
or possession and which is not an asset to be retained by Buyer under the
Distribution Agreement or the Ancillary Agreements.
SECTION 4. FORCE MAJEURE. Neither party shall be responsible for failure or
delay in performance of any services to be performed hereunder, nor shall either
party be responsible for failure or delay in receiving such service, if caused
by an act of God, act of public enemy, war, government acts or regulations,
fire, flood, hurricane, embargo, quarantine, epidemic, labor stoppages beyond
its reasonable control, accident, explosion, unusually severe weather or other
cause similar or dissimilar to the foregoing beyond their control (herein called
FORCE MAJEURE); provided, however, that prior to being relieved of any of its
obligations, the party whose performance has been interrupted by such
circumstances shall use reasonable efforts to remove or otherwise address the
effects of any such event or condition as soon as practicable and shall promptly
give written notice to the other party upon the occurrence of any of such events
or circumstances and shall use reasonable efforts to resume full performance of
this Agreement as soon as is practicable. Notwithstanding the foregoing, to the
extent services are available after the occurrence of a Force Majeure event,
Buyer shall be entitled to, and Supplier shall provide, a level of services
equivalent to the proportionate share of services used by Buyer immediately
prior to the occurrence of any such Force Majeure event.
SECTION 5. CONFIDENTIALITY. Any and all information which is not generally
known to the public which is exchanged by the parties in connection with this
Agreement, whether of a technical or business nature, shall be considered
confidential. The parties agree that such confidential information shall be
treated in accordance with the terms and provisions of the Distribution
Agreement.
SECTION 6. USE OF ASSETS. As set forth in the Distribution Agreement, Buyer
shall have the right to occupy certain facilities and to use certain management
information systems and telecommunications systems, all as more fully set forth
in Exhibit A. In consideration therefor, Buyer shall pay a fee as more
particularly set forth in Exhibit A. Supplier makes no
-3-
representation or warranty as to the adequacy or condition of the facilities and
the management information and telecommunications systems referred to above or
otherwise, and shall have no liability to Buyer with respect to such facilities
or such other assets, including in respect of the condition, use or adequacy of
such assets.
SECTION 7. AMENDMENT. This Agreement may be amended only by a writing
signed by each of the parties.
SECTION 8. COUNTERPARTS. 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 a single instrument.
SECTION 9. THIRD PARTIES. Nothing expressed or implied in this Agreement is
intended, or shall be construed, to confer upon or give any person or entity
other than Buyer and Supplier (and its associated indemnified parties under
Section 3(d)) any rights or remedies under, or by reason of, this Agreement.
SECTION 10. WAIVERS. Any waiver by any party of any breach of or failure to
comply with any provision of this Agreement by any other party to this Agreement
shall be in writing and shall not be construed as, or constitute, a continuing
waiver of such provision, or a waiver of any other breach of, or failure to
comply with, any other provision of this Agreement.
SECTION 11. GOVERNING LAW; CONSTRUCTION. This Agreement shall be construed
and enforced in accordance with and governed by the internal substantive laws of
the State of New Jersey. The headings in this Agreement are solely for
convenience of reference and shall not be given any effect in the construction
or interpretation of this Agreement. References to Sections are references to
Sections of this Agreement. The Exhibits of this Agreement are incorporated
herein and are part of this Agreement.
SECTION 12. NOTICES. All notices, requests, claims and other communications
hereunder shall be in writing and shall be given or made (and shall be deemed to
have been duly given or made upon receipt) by delivery by hand, by reputable
overnight courier service, by facsimile transmission, or by registered or
certified mail (postage prepaid, return receipt requested) to the respective
parties at the addresses (or at such other address for a party as shall be
specified in a notice given in accordance with this Section 12) listed below :
if to CSC, to: Xxxxxxxx Soup Company
Xxxxxxxx Xxxxx
Xxxxxx, Xxx Xxxxxx 00000
Attn.: Xxxxx X. Xxxxxxxx, Esq.
Fax No.: (000) 000-0000
-4-
if to Vlasic, to: Vlasic Foods International Inc.
Xxxxxxxx Xxxxx
Xxxxxx, Xxx Xxxxxx 00000
Attn.: Xxxxx X. Xxxxxx, Esq.
Fax No.: (000) 000-0000
or to such other address as any party may, from time to time, designate in a
written notice given in a like manner. Notice given by hand shall be deemed
delivered when received by the recipient. Notice given by mail as set out above
shall be deemed delivered five calendar days after the date the same is mailed.
Notice given by reputable overnight courier shall be deemed delivered on the
next following business day after the same is sent. Notice given by facsimile
transmission shall be deemed delivered on the day of transmission provided
telephone confirmation of receipt is obtained promptly after completion of
transmission.
SECTION 13. ASSIGNMENT. Neither of the parties may assign or delegate any
of its rights or duties under this Agreement without the prior written consent
of the other party, which consent will not be unreasonably withheld. This
Agreement shall be binding upon, and shall inure to the benefit of, the parties
hereto and their respective successors and permitted assigns.
SECTION 14. DISPUTES. (a) Resolution of any and all disputes arising from
or in connection with this Agreement, whether based on contract, tort, statute
or otherwise, including, but not limited to, disputes in connection with claims
by third parties (collectively, DISPUTES), shall be subject to the provisions of
this Section 14; provided, however, that nothing contained herein shall preclude
either party from seeking or obtaining (i) injunctive relief or (ii) equitable
or other judicial relief to enforce the provisions hereof or to preserve the
status quo pending resolution of Disputes hereunder.
(b) Either party may give the other party written notice of any
Dispute not resolved in the normal course of business. The parties shall attempt
in good faith to resolve any Dispute promptly by negotiation between executives
of the parties who have authority to settle the controversy and who are at a
higher level of management than the persons with direct responsibility for
administration of this Agreement. Within 30 days after delivery of the notice,
the foregoing executives of both parties shall meet at a mutually acceptable
time and place, and thereafter as often as they reasonably deem necessary for a
period not to exceed 15 days, to attempt to resolve the Dispute. All reasonable
requests for information made by one party to the other will be honored. If the
parties do not resolve the Dispute within such 45 day period (the INITIAL
MEDIATION PERIOD), the parties shall attempt in good faith to resolve the
Dispute by negotiation between (i) in the case of CSC, the Chief Financial
Officer or the Vice President -Treasurer and (ii) in the case of Spinco, the
Chief Financial Officer (collectively, the DESIGNATED OFFICERS). Such officers
shall meet at a mutually acceptable time and place (but in any event no later
than 15 days following the expiration of the Initial Mediation Period) and
thereafter as often as they reasonably deem necessary for a period not to exceed
15 days, to attempt to resolve the Dispute.
-5-
(c) If the Dispute has not been resolved by negotiation within 75 days
of the first party's notice, or if the parties failed to meet within 30 days of
the first party's notice, or if the Designated Officers failed to meet within 60
days of the first party's notice, either party may commence any litigation or
other procedure allowed by law.
-6-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their duly authorized officers as of the day and year first above
written.
XXXXXXXX SOUP COMPANY
By:__________________________________
Name:
Title:
VLASIC FOODS INTERNATIONAL INC.
By:__________________________________
Name:
Title:
-7-
