TRANSITION SERVICES AGREEMENT
by and between
AJJA INC.
and
STANDARD MICROSYSTEMS CORPORATION
Dated as of: October 7, 1997
TABLE OF CONTENTS
ARTICLE 1. SERVICES . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE 2. FEES . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE 3. CONFIDENTIALITY. . . . . . . . . . . . . . . . . . 2
ARTICLE 4. TERMINATION. . . . . . . . . . . . . . . . . . . . 2
4.01. For Default. . . . . . . . . . . . . . . . . . . . 2
4.02. For Convenience. . . . . . . . . . . . . . . . . . 2
4.03. Effect of Termination. . . . . . . . . . . . . . . 3
ARTICLE 5. WARRANTY AND LIABILITY OF SMSC . . . . . . . . . . 3
5.01. Disclaimer of Warranty; Standard for
Performance. . . . . . . . . . . . . . . . . . . . 3
5.02. Force Majeure. . . . . . . . . . . . . . . . . . . 3
5.03. Limitation of Liability. . . . . . . . . . . . . . 3
ARTICLE 6. MISCELLANEOUS PROVISIONS . . . . . . . . . . . . . 3
6.01. Waiver, Remedies Cumulative. . . . . . . . . . . . 3
6.02. Invalid Provisions . . . . . . . . . . . . . . . . 4
6.03. Headings . . . . . . . . . . . . . . . . . . . . . 4
6.04. Exhibits . . . . . . . . . . . . . . . . . . . . . 4
6.05. Notices. . . . . . . . . . . . . . . . . . . . . . 4
6.06. Relationship . . . . . . . . . . . . . . . . . . . 5
6.07. Governing Law. . . . . . . . . . . . . . . . . . . 5
6.08. Covenant of Further Assurances . . . . . . . . . . 6
6.09. Entire Understanding . . . . . . . . . . . . . . . 6
6.10. Assignment . . . . . . . . . . . . . . . . . . . . 6
6.11. Amendments . . . . . . . . . . . . . . . . . . . . 6
6.12. Survival . . . . . . . . . . . . . . . . . . . . . 6
6.13. Counterparts . . . . . . . . . . . . . . . . . . . 6
6.14. Third Party Beneficiaries. . . . . . . . . . . . . 6
6.15. Consents, Approvals and Requests . . . . . . . . . 7
EXHIBIT A - Services (other than Computer Services) EXHIBIT B - Computer
Services EXHIBIT C - Fees
TRANSITION SERVICES AGREEMENT (this "Agreement"), dated as of October
7, 1997 (the "Agreement Date") by and between AJJA Inc., a Delaware corporation
(the "Company"), and STANDARD MICROSYSTEMS CORPORATION, a Delaware corporation
("SMSC").
WITNESSETH:
WHEREAS, SMSC, certain subsidiaries of SMSC, the Company, Global
Business Investments (B.V.I.) Corp., a British Virgin Islands corporation and
Accton Technology Corporation are parties to a Stock Purchase Agreement, dated
as of September 30, 1997 (the "Stock Purchase Agreement"; capitalized terms not
otherwise defined herein shall have the meanings ascribed thereto in the Stock
Purchase Agreement), pursuant to which, among other things, SMSC has agreed to
transfer to the Company certain of the assets relating to the operation of the
Business and the Company has agreed to assume certain of the liabilities
relating to the Business;
WHEREAS, in order to facilitate the orderly continuation of the
Business for a transitional period after the Closing, SMSC has agreed to provide
certain administrative and transition services to the Company;
NOW, THEREFORE, in consideration of the agreements of SMSC and the
Company set forth below, SMSC and the Company agree as follows:
ARTICLE 1. SERVICES.
SMSC shall provide to the Company the administrative and other
transition services described in Exhibit A (the "Transition Services") for the
time period(s) indicated in Exhibit A, and the computer services described in
Exhibit B for the time period(s) indicated in Exhibit A (the "Computer Services"
and collectively with the services described in Exhibit A, the "Services"; each
a "Service").
ARTICLE 2. FEES.
(a) The Company shall pay to SMSC the fees set forth in Exhibit C (the
"Fees") in respect of the Services according to the payment schedule set forth
in Exhibit C.
(b) Not later than the close of business on the tenth day of every
month (or if such day is not a Business Day, the first Business Day thereafter)
in which Services were provided pursuant to this Agreement in the previous
month, SMSC shall deliver an invoice to the Company setting forth the Fees
payable by the Company for the Services provided by SMSC in such prior month
(the "Fee Invoice"). The Company shall pay in full the Fees set forth in the Fee
Invoice by wire transfer of immediately available funds to an account designated
in writing by SMSC not later than the close of business on the fifth Business
Day following the date on which the Fee Invoice is received by the Company;
provided, however, that in the event the Company disputes any Fees set forth on
the Fee Invoice, the Company may withhold payment of any disputed amounts
pending resolution of the dispute and shall pay the disputed amounts in the
foregoing manner not later than the close of business on the fifth Business Day
following the date on which the dispute is resolved.
ARTICLE 3. CONFIDENTIALITY.
All confidential or proprietary information and documentation ("the
Confidential Information") relating to either party shall be held in strict
confidence by the other party (including its Affiliates). Neither party shall
disclose, publish, release, transfer or otherwise make available Confidential
Information of the other party in any form to, or for the use or benefit of, any
person or entity without the other party's prior approval. The obligations in
this Article 3 shall not (a) restrict any disclosure by either party if it is
compelled to disclose pursuant to any applicable Law, or by order of any
Governmental Authority (provided that the disclosing party shall give prompt
notice to the non-disclosing party of such order) and (b) apply with respect to
information that (i) is independently developed by the other party without
reference to any Confidential Information, (ii) becomes part of the public
domain (other than through unauthorized disclosure), (iii) is later acquired by
the receiving party from another source if the receiving party is not aware that
such source is under an obligation to the other party hereto to keep such
documents and information confidential or (iv) previously known by the party
receiving such documents or information.
ARTICLE 4. TERMINATION.
4.01. For Default. In the event that either party fails to perform, in
any material respect, any of its duties or obligations pursuant to this
Agreement and such failure is not cured within 30 days after notice to such
party specifying the nature of such failure, the other party may terminate this
Agreement immediately upon further notice to the defaulting party.
4.02. For Convenience. Either party may terminate
this Agreement in respect of any or all of the Services as set
forth in the Exhibits.
4.03. Effect of Termination. Upon (a) the termination of this
Agreement pursuant to Section 4.01 or (b) the termination of all of the Services
pursuant to Section 4.02, all Fees owed by the Company to SMSC for Services
provided through the date of such expiration or termination shall be paid
promptly after the date of such termination.
ARTICLE 5. WARRANTY AND LIABILITY OF SMSC.
5.01. Disclaimer of Warranty; Standard for Performance. SMSC MAKES NO
WARRANTY REGARDING THE MERCHANTABILITY OF THE SERVICES OR THE FITNESS OF THE
SERVICES FOR ANY PARTICULAR PURPOSE. SMSC shall provide the Services in
substantially the same manner as the activities constituting the Services
heretofore were conducted in the ordinary course for SMSC's own account and
shall use the same degree of care in providing Services to the Company as SMSC
hereafter shall use in the ordinary course in conducting the same or comparable
activities for its own account. SMSC shall have no liability to the Company or
any other person with respect to provision of or failure to provide any of the
Services so long as SMSC performs its obligations hereunder in conformity with
the standards set forth in the preceding sentence.
5.02. Force Majeure. In no event shall SMSC have any liability under
this Transition Services Agreement for any failure to provide or delay,
interruption, or error in providing any of the Services that results directly or
indirectly from the following circumstances (or similar force majeure events):
inclement weather, fire, flood, earthquake, or other catastrophe, strike, civil
disturbance or war or failure of any of SMSC's vendors to deliver any goods or
render any services.
5.03. Limitation of Liability. IN NO EVENT SHALL SMSC BE LIABLE UNDER
THIS TRANSACTION SERVICES AGREEMENT FOR SPECIAL, INCIDENTAL, CONSEQUENTIAL,
PUNITIVE, OR EXEMPLARY DAMAGES. SMSC's liability for any failure to provide or
delay, interruption, or error in providing any Service shall not exceed the fair
market value of the Service (or portion thereof) in question.
ARTICLE 6. MISCELLANEOUS PROVISIONS.
6.01. Waiver, Remedies Cumulative. Any term or condition of this
Agreement may be waived at any time by the party that is entitled to the benefit
thereof, but no such waiver shall be effective unless set forth in a written
instrument duly executed by or on behalf of the party waiving such term or
condition. No waiver by any party of any term or condition of this Agreement, in
any one or more instances, shall be deemed to be or construed as a waiver of the
same or any other term or condition of this Agreement on any future occasion.
All remedies, either under this Agreement or by Law or otherwise afforded, will
be cumulative and not alternative.
6.02. Invalid Provisions. If any provision of this Agreement is held
to be illegal, invalid or unenforceable under any present or future Law, and if
the rights or obligations of any party hereto under this Agreement will not be
materially and adversely affected thereby, (a) such provision will be fully
severable, (b) this Agreement will be construed and enforced as if such illegal,
invalid or unenforceable provision had never comprised a part hereof and (c) the
remaining provisions of this Agreement will remain in full force and effect and
will not be affected by the illegal, invalid or unenforceable provision or by
its severance herefrom.
6.03. Headings. The headings used in this Agreement have been inserted
for convenience of reference only and do not define, limit or otherwise in any
way affect the provisions hereof.
6.04. Exhibits. The Exhibits attached hereto are incorporated herein
by reference as an integral part of this Agreement. In the event of any
inconsistency between the terms contained in the Exhibits and the terms
contained herein, the terms in the Exhibits shall govern.
6.05. Notices. Except as otherwise specified in this Agreement, all
notices, requests and other communications hereunder must be in writing and will
be deemed to have been duly given only if delivered personally or by facsimile
transmission or mailed (first class postage prepaid) to the parties at the
following addresses or facsimile numbers:
If to SMSC:
Standard Microsystems Corporation
80 Arkay Drive
Hauppauge, NY 11788
Attention: Paul Richman, Chairman
Facsimile No.: 516-273-5550
With copies to:
George W. Houseweart, Sr. Vice President
Law and Intellectual Property
Standard Microsystems Corporation
80 Arkay Drive
Hauppauge, NY 11788
and
Loeb & Loeb LLP
345 Park Avenue
New York, New York 10154-0037
Attention: David C. Fischer, Esq.
Facsimile No.: 212-407-4990
If to the Company:
AJJA, Inc.
Lance Murrah
President and General Manager
350 Kennedy Dr.
Hauppauge, New York 11788
Facsimilie No.: 516-273-7935
With a copy to:
Milbank, Tweed, Hadley & McCloy
One Chase Manhattan Plaza
New York, New York 10005
Attention: John T. O'Connor, Esq.
Facsimile No.: 212-530-5219
All such notices, requests and other communications will (i) if delivered
personally to the address as provided in this Section, be deemed given upon
delivery, (ii) if delivered by facsimile transmission to the facsimile number
provided in this Section, be deemed given upon receipt, and (iii) if delivered
by mail in the manner described above to the address as provided in this
Section, be deemed given upon receipt (in each case regardless of whether such
notice, request or other communication is received by any other Person to whom a
copy of such notice, request or other communication is to be delivered pursuant
to this Section). Any party from time to time may change its address, facsimile
number or other information for the purpose of notices to that party by giving
notice specifying such change to the other parties hereto.
6.06. Relationship. The performance by SMSC of its duties and
obligations under this Agreement shall be that of an independent contractor and
nothing herein contained shall create or imply an agency relationship between
the parties, nor shall this Agreement be deemed to constitute a joint venture or
partnership between the parties.
6.07. Governing Law. This Agreement shall be governed by and construed
in accordance with the Laws of the State of New York applicable to a contract
executed and performed therein, without giving effect to the conflicts of laws
principles thereof.
6.08. Covenant of Further Assurances. The parties covenant and agree
that, subsequent to the execution and delivery of this Agreement and without any
additional consideration, each of the parties will execute and deliver, or cause
appropriate Affiliates to execute and deliver, any further legal instruments and
perform any acts which are or may become reasonably necessary to effectuate this
Agreement.
6.09. Entire Understanding. This Agreement represents the entire
understanding of the parties with respect to the Services and supersedes all
previous writings, correspondence and memoranda with respect thereto, and no
representations, warranties, agreements or covenants, express or implied, of any
kind or character whatsoever with respect to such subject matter have been made
by either party to the other, except as herein expressly set forth.
6.10. Assignment. Neither this Agreement nor any right, interest or
obligation hereunder may be assigned by any party hereto without the prior
written consent of the other party hereto and any attempt to do so will be void.
Subject to the restrictions on assignment set forth in the immediately preceding
sentence, this Agreement shall be binding upon and inure to the benefit of and
be enforceable against the parties hereto and their respective successors and
assigns.
6.11. Amendments. This Agreement may be amended,
supplemented or modified only by a written amendment executed by
both parties hereto.
6.12. Survival. The provisions of Article 3, Section 4.03, Article 5,
Section 6.07 and this Section 6.12, shall survive the expiration or the
termination of this Agreement.
6.13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
6.14. Third Party Beneficiaries. The terms and provisions of this
Agreement are intended solely for the benefit of each party hereto and their
respective successors or permitted assigns, and it is not the intention of the
parties hereto to confer third-party beneficiary rights upon any other Person
other than any Person entitled to indemnity under Article 5.
6.15. Consents, Approvals and Requests. All consents and approvals to
be given by either party under this Agreement shall not be unreasonably withheld
or delayed and all requests made by a party under this Agreement shall be
reasonable.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their duly authorized officers as of the date first above
written.
AJJA INC.
By: Lance Murrah
President and
General Manager
STANDARD MICROSYSTEMS CORPORATION
By: Paul Richman
Chairman and CEO