TRANSITION SERVICES AGREEMENT
by and between
STANDARD MICROSYSTEMS CORPORATION
and
INERTIA OPTICAL TECHNOLOGY APPLICATIONS, INC.
Dated as of: June 1, 1999
TABLE OF CONTENTS
ARTICLE 1. SERVICES
ARTICLE 2. FEES
ARTICLE 3. CONFIDENTIALITY
ARTICLE 4. TERMINATION
4.01. For Default
4.02. For Convenience
4.03. Effect of Termination
ARTICLE 5. WARRANTY AND LIABILITY OF SMSC
5.01. Disclaimer of Warranty; Standard for
Performance
5.02. Force Majeure
5.03. Limitation of Liability
ARTICLE 6. MISCELLANEOUS PROVISIONS
6.01. Waiver, Remedies Cumulative
6.02. Invalid Provisions
6.03. Headings
6.04. Exhibits
6.05. Notices
6.06. Relationship
6.07. Governing Law
6.08. Covenant of Further Assurances
6.09. Entire Understanding
6.10. Assignment
6.11. Amendments
6.12. Survival
6.13. Counterparts
6.14. Third Party Beneficiaries
6.15. Consents, Approvals and Requests
EXHIBIT A - Services (other than Information Technology Services)
EXHIBIT B - Information Technology Services
EXHIBIT C - Fees
TRANSITION SERVICES AGREEMENT (this "Agreement"), dated as of
June 1, 1999 (the "Agreement Date") by and between STANDARD MICROSYSTEMS
CORPORATION, a Delaware corporation ("SMSC") and INERTIA OPTICAL TECHNOLOGY
APPLICATIONS, INC., a Delaware corporation (the "Company").
WITNESSETH:
WHEREAS, SMSC and the Company are parties to an Asset
Purchase Agreement, dated as of May __, 1999 (the "Asset 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 its FBU Business and
the Company has agreed to assume certain of the liabilities relating to that
Business (capitalized terms not otherwise defined herein shall have the
meanings ascribed thereto in the Asset Purchase Agreement);
WHEREAS, in order to facilitate the orderly continuation of
the FBU Business for a transitional period after the Closing, SMSC has agreed
to provide certain administrative and other 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 for the time period(s)
indicated in Exhibit A, and the information technology services described in
Exhibit B for the time period(s) indicated in Exhibit A (collectively, 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 previous
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
ninetieth (90th) 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 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 written
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
(including with respect to the notice provisions set forth therein).
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:
SMSC:
Standard Microsystems Corporation
80 Arkay Drive, P.O. Box 18047
Hauppauge, New York 11788-8847
Telecopy: (516) 273-5550
Attention: Steven J. Bilodeau, President and
Chief Executive Officer
With copies to:
Standard Microsystems Corporation
80 Arkay Drive, P.O. Box 18047
Hauppauge, New York 11788-8847
Telecopy: (516) 273-5550
Attention: George W. Houseweart, Senior Vice
President and General Counsel
Loeb & Loeb LLP
345 Park Avenue
New York, New York 10154
Telecopy: (212) 407-4990
Attention: David C. Fischer, Esq.
IOTA:
Inertia Optical Technology Applications, Inc.
24 New England Executive Park
Burlington, Massachusetts 01803
Telecopy: (781) 229-6794
Attention: Nicholas E. Ortyl III, President and
Chief Executive Officer
With a copy to:
Morrison & Foerster LLP
1290 Avenue of the Americas
New York, New York 10104
Telecopy: (212) 468-7900
Attention: Charles B. Friedman, Esq.
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.
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.
STANDARD MICROSYSTEMS CORPORATION
By: _______________________________________
Steven J. Bilodeau
President and Chief Executive Officer
and
INERTIA OPTICAL TECHNOLOGY APPLICATIONS, INC.
By: ________________________________________
Nicholas E. Ortyl III
President and Chief Executive Officer
EXHIBIT A - Services (other than Information
Technology Services)
EXHIBIT B - Information Technology Services
EXHIBIT C - Fees