EXHIBIT 10.1
CORPORATE SERVICES AGREEMENT
THIS is an AGREEMENT dated as of the 20th day of March, 1996 between
Thermo Electron Corporation, a Delaware corporation ("Thermo"), and Thermedics
Detection Inc. ("Subsidiary"), a Massachusetts corporation.
PRELIMINARY STATEMENT
Subsidiary desires to obtain administrative and other services from
Thermo and Thermo is willing to furnish or make such services available to
Subsidiary.
By this Agreement, Thermo and Subsidiary desire to set forth the basis
for Thermo's providing services of the type referred to herein.
AGREEMENTS
IT IS MUTUALLY agreed by the parties hereto as follows:
1. SERVICES
1.1 Beginning on the date of this Agreement, Thermo, through its
corporate staff, will provide or otherwise make available to Subsidiary certain
general corporate services, including but not limited to accounting, tax,
corporate communications, legal, financial and other administrative staff
functions, and arrange for administration of insurance and employee benefit
programs. The services will include the following:
(a) ACCOUNTING AND SECURITIES COMPLIANCE RELATED SERVICES.
Maintenance of corporate records, assistance, if and when necessary, in
preparation of Securities and Exchange Commission filings, including without
limitation registration statements, Forms 10-K, 10-Q and 8-K, assistance in the
preparation of Proxies and Proxy Statements and the solicitation of Proxies, and
assistance in the preparation of the Annual and Quarterly Reports to
Stockholders, maintenance of internal audit support services and review of
compliance with financial and accounting procedures.
(b) TAX RELATED SERVICES. Preparation of Federal tax returns,
preparation of state and local tax returns (including income tax returns), tax
research and planning and assistance on tax audits (Federal, state and local).
(c) INSURANCE AND EMPLOYEE BENEFIT RELATED SERVICES. Arranging for
liability, property and casualty, and other normal business insurance coverage.
Support for product, worker safety and environmental programs (Subsidiary
acknowledges that principal
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responsibility for compliance rests with the Subsidiary). Administration of
Subsidiary's employee participation in employee benefit plans sponsored by
Thermo and insurance programs such as the following: 401(k) plan, group medical
insurance, group life insurance, employee stock purchase plan and various stock
options plans. Filing of all required reports under ERISA for employee benefit
plans sponsored by Thermo.
(d) CORPORATE RECORD KEEPING SERVICES. Maintenance of corporate
records, including without limitation, maintenance of minutes of meetings of the
Boards of Directors and Stockholders, supervision of transfer agent and
registration functions, coordination of stock repurchase programs, and tracking
of stock issuances and reserved shares.
(e) Services in addition to those enumerated in subsections 1.1(a)
through 1.1(d) above including, but not limited to, routine legal and other
administrative activities, Corporate information and treasury and other
financial services as reasonably requested by Subsidiary.
1.2 For performing general services of the types described above in
Paragraph 1.1, Thermo will initially charge Subsidiary an annual fixed fee
equal to 1.0% of the gross revenues of Subsidiary for the fiscal year in which
such services are performed (such amount to be prorated on a daily basis for
any partial year), which fee is intended to compensate Thermo for Subsidiary's
pro rata share of the aggregate costs actually incurred by Thermo in connection
with the provision of such services to all recipients thereof. The fee set
forth in the preceding sentence may be adjusted from time to time by mutual
agreement of Thermo and Subsidiary.
1.3 In addition to the foregoing services, certain specific services
are made available to Subsidiary by Thermo on an as-requested basis. These may
include, but are not limited to, services specifically requested by Subsidiary
or services which, in Thermo's judgment, are not routine administrative services
or create unusual burdens or demands on Thermo's resources, such as litigation
support, acquisition and offering support services (including legal services),
corporate development, tax audit support or public or investor relations
services other than routine shareholder communications. Thermo will charge
Subsidiary the costs actually incurred (including overhead and general
administrative expenses) for such services that are requested by Subsidiary and
supplied by Thermo.
1.4 The charges for services pursuant to Subsections 1.2 and 1.3
above will be determined and payable no less frequently than on a quarterly
basis. The charges will be due when billed and shall be paid no later than 30
days from the date of billing.
1.5 When services of the type described above in this Section 1 are
provided by outside providers to Subsidiary or, in connection with the
provision of such services out-of-pocket costs are incurred such as travel, the
cost thereof will be paid by Subsidiary. To the extent that Subsidiary is
billed by the provider directly, Subsidiary shall pay the bill directly. If
Thermo is billed for such services, Thermo may pay the bill and charge
Subsidiary the amount of the bill or forward the bill to Subsidiary for payment
by Subsidiary.
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2. SUBSIDIARY'S DIRECTORS AND OFFICERS. Nothing contained herein
will be construed to relieve the directors or officers of Subsidiary from the
performance of their respective duties or to limit the exercise of their powers
in accordance with the charter or By-Laws of Subsidiary or in accordance with
any applicable statute or regulation.
3. LIABILITIES. In furnishing Subsidiary with management advice
and other services as herein provided, neither Thermo nor any of its officers,
directors or agents shall be liable to Subsidiary or its creditors or
shareholders for errors of judgment or for anything except willful malfeasance,
bad faith or gross negligence in the performance of their duties or reckless
disregard of their obligations and duties under the terms of this Agreement. The
provisions of this Agreement are for the sole benefit of Thermo and Subsidiary
and will not, except to the extent otherwise expressly stated herein, inure to
the benefit of any third party.
4. TERM.
(a) TERM. The initial term of this Agreement shall begin on the
date of this Agreement and continue through the end of the current fiscal year.
This Agreement shall automatically renew at the end of the initial term for
successive one-year terms until terminated in accordance with Subsection (b)
below.
(b) TERMINATION. This Agreement may be terminated by Subsidiary at
any time on thirty days prior notice to Thermo. In addition, this Agreement
shall automatically terminate without any further action by either party on the
date the Subsidiary ceases to be a member of the Thermo Group or a participant
in the Thermo Electron Corporate Charter.
(c) TERMINATION FEE. In the event of a termination of this
Agreement, Subsidiary shall pay to Thermo its pro rata fee pursuant to Section
1.2 for the year in which the termination takes effect plus a termination fee
equal to the fee payable under Section 1.2 for the most recent nine consecutive
months.
(d) POST-TERMINATION SERVICES. Following a termination of this
Agreement, corporate administrative services of the kind provided under the
Agreement may continue to be provided to Subsidiary on an as-requested basis by
the Subsidiary or as required in the event it is not practicable for the
Subsidiary to provide such services or it is otherwise unable to identify
another source to provide such services (as would be the case of administration
of employee benefit plans and insurance programs sponsored by Thermo and in
which Subsidiary's employees participate) or as otherwise required by Thermo
acting in its capacity as majority stockholder of Subsidiary. In the event such
services are provided by Thermo to Subsidiary, Subsidiary shall be charged by
Thermo a fee equal to the market rate for comparable services charged by third-
party vendors. Such fee will be charged monthly and payable by Subsidiary within
thirty days. The obligations of Subsidiary set forth in this Section 4(d) shall
survive the termination of this Agreement.
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5. STATUS. Thermo shall be deemed to be an independent contractor
and, except as expressly provided or authorized in this Agreement, shall have no
authority to act for or represent Subsidiary.
6. OTHER ACTIVITIES OF THERMO. Subsidiary recognizes that Thermo
now renders and may continue to render management and other services to other
companies that may or may not have policies and conduct activities similar to
those of Subsidiary. Thermo shall be free to render such advice and other
services, and Subsidiary hereby consents thereto. Thermo shall not be required
to devote full time and attention to the performance of its duties under this
Agreement, but shall devote only so much of its time and attention as it deems
reasonable or necessary to perform the services required hereunder.
7. NOTICES. All notices, billings, requests, demands, approvals,
consents, and other communications which are required or may be given under this
Agreement shall be in writing and will be deemed to have been duly given if
delivered personally or sent by registered or certified mail, return receipt
requested, postage prepaid to the parties at their respective addresses set
forth below:
If to Subsidiary: If to Thermo:
Thermedics Detection Inc. Thermo Electron Corporation
220 Mill Road 81 Wyman Street
Chelmsford, Massachusetts 02254 Waltham, Massachusetts 02254
Attention: President Attention: Chief Executive Officer
8. NO ASSIGNMENT. This Agreement shall not be assignable except
with the prior written consent of the other party to this Agreement.
9. APPLICABLE LAW. This Agreement shall be governed by and
construed under the laws of the Commonwealth of Massachusetts applicable to
contracts made and to be performed therein.
10. PARAGRAPH TITLES. The paragraph titles used in this Agreement
are for convenience of reference only and will not be considered in the
interpretation or construction of any of the provisions thereof.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as a sealed instrument by their duly authorized officers as of the date
first above written.
THERMO ELECTRON CORPORATION THERMEDICS DETECTION INC.
By: /s/ John W. Wood Jr. By: /s/ Jonathan W. Painter
Title: Senior Vice President Title: Treasurer
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