EXHIBIT 2
TRANSITION SERVICES AGREEMENT
This TRANSITION SERVICES AGREEMENT (this "Agreement") is made as of
February 5, 1999, by and between International Home Foods, Inc., a Delaware
corporation ("Parent"), and X. Xxxxxxx, Inc. a Delaware corporation and wholly
owned subsidiary of Parent (collectively with Parent, the "Sellers"), and
Roseland Distribution Company, a Delaware corporation ("Purchaser").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Asset Purchase Agreement, dated as of
January 12, 1999, between Sellers and Purchaser (the "Asset Purchase
Agreement"), Sellers have agreed to sell to Purchaser and Purchaser has agreed
to Purchase from Seller the Purchased Assets (as defined in the Asset Purchase
Agreement).
WHEREAS, in connection therewith, Purchaser and Sellers desire that
Sellers provide Purchaser with certain transition services as set forth herein;
and
WHEREAS, capitalized terms used herein and not otherwise defined herein
have the meanings given to such terms in the Asset Purchase Agreement;
NOW, THEREFORE, in consideration of the premises and covenants set
forth herein and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, Sellers and Purchaser agree as
follows:
1. Transition Services. During the term of this Agreement as set forth
in Section 4 below (the "Transition Period"), Sellers shall provide, or cause
its Affiliates to provide to Purchaser (or, if requested by Purchaser, to
Affiliates of Purchaser), as requested by Purchaser, the services set forth on
Annex A hereto in the manner and at a relative level of service consistent in
all material respects with that provided by Seller or its Affiliates to the
Acquired Business immediately prior to the date hereof and levels substantially
consistent with the levels provided during the year ended December 31, 1998.
2. Billing and Payment. Sellers shall invoice Purchaser for services
provided under this Agreement at the end of each fiscal month of Sellers during
the transition period. Such invoices shall set forth in reasonable detail the
services provided hereunder during such month and the charges therefor. All
invoices shall be paid by wire transfer not later than 30 days following receipt
by Purchaser of Seller's invoice in accordance with the instructions provided by
Sellers (in writing to Purchaser).
3. Validity of Documents. The parties hereto shall be entitled to rely
upon the genuineness, validity or truthfulness of any document, instrument or
other writing presented in connection with this Agreement unless such document,
instrument or other writing appears on its face to be fraudulent, false or
forged.
4. Term of Agreement. The term of this Agreement shall commence on the
date hereof and shall continue (unless sooner terminated pursuant to the terms
hereof) for a period of ninety (90) days, or such shorter period as may be
provided in Annex A with respect to particular services described therein.
5. Partial Termination. Any and all of the services provided by Sellers
and its Affiliates hereunder are only terminable earlier than the period
specified in Annex A by Purchaser on 10 days' prior written notice to Seller.
Any such termination shall be final.
6. Assignment. This Agreement shall not be assignable in whole or in
part by any party hereto without the prior written consent of the other party
hereto, provided that Purchaser may assign its rights and obligations (i) as
collateral security to persons providing financing for the transactions
hereunder (ii) to any person acquiring, after the Closing, all or substantially
all of the business of Purchaser and (iii) to an Affiliate of Purchaser. No
assignment hereunder shall operate to release either party from its obligations
hereunder.
7. Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York applicable to
agreements made and to be performed entirely within such State, without regard
to the conflicts of law principles of such State.
8. Limitation of Liability. Seller shall not be liable to Purchaser or
any third party for any special, consequential or exemplary damages (including
lost or anticipated revenues or profits relating to the same) arising from any
claim relating to this Agreement or any of the services provided hereunder,
whether such claim is based on warranty, contract, tort (including negligence or
strict liability) or otherwise, even if an authorized representative of Seller
is advised of the possibility or likelihood of the same.
9. Mediation. In the event a dispute arises between the parties arising
out of or relating to this Agreement or the transactions contemplated hereby,
prior to the commencement of any action, suit or proceeding relating thereto,
the parties shall submit to non-binding mediation.
10. Consent to Jurisdiction. Any action, suit or other proceeding
initiated by any Sellers or Purchaser against the other under or in connection
with this Agreement may be brought in the federal courts for the Southern
District of New York or any state court in New York County, New York, as the
party bringing such action, suit or proceeding shall elect, having jurisdiction
over the subject matter thereof. Purchase and Sellers hereby submit themselves
to the jurisdiction of any such court.
11. Counterparts. This Agreement may be executed in one or more
counterparts, 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 parties.
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12. Notices. All notices or other communications which are required or
permitted hereunder shall be in writing and sufficient if delivered personally
or sent by registered or certified mail, postage prepaid, addressed as follows:
If the Seller:
International Home Foods, Inc.
0000 Xxxxxxxxx Xxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: General Counsel
With a copy to:
Xxxxxx & Xxxxxx
3700 Xxxxxxxx Xxxx Center
0000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attention: Xxxxxxx Xxxxx
If to Purchaser:
Roseland Distribution Company
c/o B&G Foods, Inc.
000 Xxxxx Xxxx Xxxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attention: President
With a copy to:
Dechert, Price & Xxxxxx
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Attention: Glyndwr X. Xxxx
13. Modification, Nonwaiver, Severability. Neither this Agreement nor
any part hereof may be changed, altered or amended orally. Any modification must
be by written instrument signed by the parties. Failure by either party to
exercise promptly any right granted herein or to require strict performance of
any obligation imposed hereunder shall not be deemed a waiver of such right. If
any provision of this Agreement is held ineffective for any reason, the other
provisions shall remain effective.
14. Interpretation. The headings and captions contained in this
Agreement and in Annex A attached hereto are for reference purposes only and
shall not affect in any way the meaning or interpretation of this Agreement. The
use of the word "including" herein shall mean "including without limitation."
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15. No Strict Construction. The language used in this Agreement shall
be deemed to be the language chosen by the parties hereto to express their
mutual intent, and no rule of strict construction shall be applied against any
person.
16. Entire Agreement. This Agreement and the Asset Purchase Agreement
contain the entire agreement and understanding between the parties hereto with
respect to the subject matter hereof and supersede all prior agreements and
understandings, whether written or oral, relating to such subject matter.
17. Relationship of Parties. Except as specifically provided herein,
none of the parties shall act or represent or hold itself out as having
authority to act as an agent or partner of the other parties, or in any way bind
or commit the other party to any obligations. Nothing contained in this
Agreement shall be construed as creating a partnership, joint venture, agency,
trust or other association of any kind, each party being individually
responsible only for its obligations as set forth in this Agreement.
18. Force Majeure. If Sellers are prevented from complying, either
totally or in part, with any of the terms or provisions of this Agreement by
reason of fire, flood, storm, strike, law, order, proclamation, regulation,
ordinance, demand or requirement of any governmental authority, riot, war,
rebellion or other causes beyond the reasonable control of Sellers or other acts
of God, then upon written notice to Purchaser, the affected provisions and/or
other requirements of this Agreement shall be suspended during the period of
such disability and Sellers shall have no liability to Purchaser or any other
party in connection therewith. Sellers shall make all reasonable efforts to
remove such disability as soon as reasonably possible.
19. Notwithstanding anything to the contrary in this Agreement,
wherever under the terms of this Agreement Sellers are required to act in the
ordinary course and/or consistent with Sellers' past practice or levels, such
standards shall not apply to any acts of Sellers undertaken by either or both of
them in compliance with orders, requests or instructions given Sellers by
Purchaser pursuant to this Agreement, and Sellers shall not be liable to
Purchaser for not conforming to such standards regarding such acts.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized representatives as of the date and year first
set forth above.
INTERNATIONAL HOME ROSELAND DISTRIBUTION
FOODS, INC. CORPORATION
By: /S/Xxxxx Xxxxxx By: /S/Xxxxx Xxxxxx
--------------------------- ---------------------------
Xxxxx Xxxxxx Xxxxx Xxxxxx
Vice President President
X. XXXXXXX, INC.
By: /S/ Xxxxx Xxxxxx
---------------------------
Xxxxx Xxxxxx
Vice President
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ANNEX A
TRANSITION SERVICES AGREEMENT
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SERVICES TO BE PROVIDED:
The following services will be provided at Sellers' direct variable cost
(excluding fixed overhead) for a period of 90 days unless otherwise specified:
A. SALES:
1. Sellers will process orders and invoices that are combined with
International Home Foods' products for a period of one (1) week after
Closing. All orders received after that period, at Purchaser's request,
would be forwarded to Purchaser. Purchaser to be charged a flat $50 per
invoice.
2. Sellers will provide all sales, authorization, promotion, and spending
reports through the period of such transition services.
3. Sellers will forward to Purchaser copies of all price lists with
Polaner products.
4. Sellers will provide Purchaser's representatives an opportunity to meet
with Sellers' personnel to give Purchaser background information on all
sales plans, programs and commitments. Specifically, Sellers will make
their personnel in Sellers' Parsippany, NJ office available for three
days and personnel in other off-site locations available for half a day
per location. Purchaser will be charged $25 per hour.
B. DISTRIBUTION:
1. Sellers will ship all Polaner orders with all orders calling for
delivery of International Home Foods products for a period of one (1)
week after the Closing. Purchaser will be charged actual freight plus
10%.
2. Sellers will, upon three days prior notice, ship all other orders based
on Purchaser's direction. Purchaser will be charged actual freight plus
10%.
3. At Purchaser's direction, Sellers will transfer all Polaner inventory
from International Home Foods' distribution centers to B&G Food's
distribution centers. All shipments will be charged at actual freight
plus 10% or, at Purchaser's option, Purchaser may arrange (free of
charge by Sellers) for the transportation of the Polaner inventory to
B&G Food's distribution centers. Purchaser will ensure that current
order fill rates will be maintained.
4. Sellers will provide Purchaser's representatives an opportunity to meet
with Seller's personnel to discuss all distribution plans, programs and
commitments, on the same terms as set forth in A.4 above.
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C. MARKETING:
1. Sellers will manage as is done currently, for a period of thirty (30)
days following the Closing, all consumer calls to the 800 number as
well as any internet or mailed requests and/or complaints from
customers. Sellers will provide to Purchaser reports on these requests
and complaints in the same fashion as they would be provided to the
marketing team at International Home Foods.
2. After thirty (30) days following the Closing, Sellers will forward all
calls, mail and internet requests to Purchaser.
3. Coupons: All coupons received will be forwarded to Purchaser for
disposition. All relevant marking information, support materials,
display materials, point-of-purchase materials, consumer reports, and
similar items will be forwarded to Purchaser.
4. Sellers will provide Purchaser's representatives an opportunity to meet
with Seller's personnel to discuss all marketing plans, programs and
commitments on the same terms as set forth in A.4 above.
5. Sellers will continue to provide Purchaser with Xxxxxxx data relating
to the Acquired Business at Sellers' cost for a period of three months
following the Closing. Sellers will cooperate with Purchaser in
arranging for Purchaser to obtain is own servicing contract from
Xxxxxxx.
D. G&A:
Sellers will provide Purchaser with all appropriate reports and documentation as
is reasonably necessary or desirable to enable Purchaser to conduct the Acquired
Business following the Closing in a manner similar to which it has been
conducted by Sellers in the past.
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