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SHARED SERVICES AGREEMENT

Consulting Services Agreement

SHARED SERVICES AGREEMENT | Document Parties: WESTWAY GROUP, INC. | ED & F Man Holdings Ltd | Shermen WSC Acquisition Corp You are currently viewing:
This Consulting Services Agreement involves

WESTWAY GROUP, INC. | ED & F Man Holdings Ltd | Shermen WSC Acquisition Corp

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Title: SHARED SERVICES AGREEMENT
Date: 8/10/2009

SHARED SERVICES AGREEMENT, Parties: westway group  inc. , ed & f man holdings ltd , shermen wsc acquisition corp
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Exhibit 10.6

SHARED SERVICES AGREEMENT

This Shared Services Agreement (this “Agreement”) is made and entered into as of the 28th day of May, 2008, by and between ED & F Man Holdings Ltd., a limited company organized under the laws of England and Wales (individually and collectively with its Affiliates, “Man”), and Westway Group, Inc., formerly known as Shermen WSC Acquisition Corp., a Delaware corporation (individually and collectively with its Affiliates, “ Westway ”).

R E C I T A L S

WHEREAS, Man transferred its worldwide bulk liquid terminaling and North American liquid animal feed manufacturing and distribution businesses and related business assets (collectively, the “Business”) to Westway pursuant to the terms and conditions of that Transaction Agreement dated November 25, 2008 (the “Transaction Agreement”);

WHEREAS, prior to such transfer, Man and the Business, as affiliated entities, shared executive office space and certain administrative services and allocated the cost of such services among them on a rational basis;

WHEREAS, following such transfer, the Business relies upon certain services, the physical and human resources for the provision of which remain with Man; and Man relies upon certain services, the physical and human resources for the provision of which have been transferred to Westway;

WHEREAS, Section 4.2 of the Transaction Agreement provides that, on the Closing Date, Man and Westway shall execute and deliver a shared services agreement, pursuant to which Man will make available to Westway certain services and Westway will make available to Man certain services, on a basis substantially consistent with the parties’ recent historical practice and for a price equal to the providing party’s Fully Allocated Cost of the service (which shall be substantially similar to that reflected with respect to such services in the financial statements specified in Section 5.5 of the Transaction Agreement); and

WHEREAS, Westway desires to obtain certain services from Man for the purpose of enabling Westway to manage an orderly transition in its operation of the Business and retain the benefit of operational efficiencies created by the sharing of such services; and Man desires to obtain certain services from Westway for the purpose of enabling Man to retain the benefit of operational efficiencies created by the sharing of such services;

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

AGREEMENT

 

1.

DEFINITIONS

1.1 “Business” shall have the meaning set forth in the first recital of this Agreement.


1.2 “Fully Allocated Cost” shall mean, with respect to any product or service, the cost of all labor (including, without limitation, the cost of all employment taxes and benefits), overhead, services, and materials expenditures allocated (on a rational basis substantially consistent with the methodology described for such Service on the schedule hereto describing such Service and, to the extent not inconsistent, with recent historical practice of Man and the Business as reflected in the financial statements specified in Section 5.5 of the Transaction Agreement), without markup, to such product or service. The cost of any and all labor allocable to a product or service will include a charge of 20% of the base salary of such labor to account for bonuses payable, and any and all actual bonuses payable to such employees will be excluded from the calculation of Fully Allocated Cost.

1.3 “Man Services” shall mean the NA Tax Services, ROW Tax Services, ROW HR Services, ROW MIS Services, ROW Accounting Support Services, ROW HSEQ Services, ROW Other Corporate Services, and ROW Office Services.

1.4 “NA Accounting Support Services” shall mean, with respect to the purchase and sale of products to third parties from North America, financial and accounting support, recordkeeping, customer billing and collections, order processing, accounts payable processing, and preparing and reporting of monthly estimates and results, as further specified in Schedule 1.4.

1.5 “NA HR Services” shall mean the services of the internal human resources department and staff located in North America, as provided to Man and the Business in accordance with recent historical practice, as further specified in Schedule 1.5.

1.6 “NA HSEQ Services” shall mean the services of the Health, Safety, Environmental, and Quality Department and staff located in North America, as provided to Man and the Business in accordance with recent historical practice, as further specified in Schedule 1.6.

1.7 “NA Insurance Services” shall mean the services of the insurance department and staff located in North America, as provided to Man and the Business in accordance with recent historical practice, as further specified in Schedule 1.7.

1.8 “NA MIS Services” shall mean all computer and data-processing services and support provided to Man and the Business in North America in accordance with recent historical practice, as further specified in Schedule 1.8.

1.9 “NA Office Services” shall mean the office space, reception, parking, and related services located in North America, as further specified in Schedule 1.9.

1.10 “NA Tax Services” shall mean the services of the internal tax department and staff in North America, as provided to Man and the Business in accordance with recent historical practice, as further specified in Schedule 1.10.

1.11 “Other Services” shall mean, with respect to Services provided by Westway, Services that are not Westway Services; and, with respect to Services provided by Man, Services that are not Man Services.

 

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1.12 “Rationalization Expenses” shall mean the net expenses incurred by a Service Provider pursuant to this Agreement directly resulting from the termination of such Service and disposition of human and physical resources no longer required due to the termination of such Service, including without limitation the severance costs relating to the termination of employees no longer required to provide such Service, but net of any proceeds from the disposition of any physical assets used in the provision of such Service.

1.13 “ROW Accounting Support Services” shall mean, with respect to the purchase and sale of products and services to third parties from outside of North America, financial and accounting support, recordkeeping, customer billing and collections, order processing, accounts payable processing, and preparing and reporting of monthly estimates and results, as further specified in Schedule 1.13.

1.14 “ROW HR Services” shall mean the services of the internal human resources department and staff located outside North America, as provided to Man and the Business in accordance with recent historical practice, as further specified in Schedule 1.14.

1.15 “ROW HSEQ Services” shall mean the services of the Health, Safety, Environmental, and Quality Department and staff located outside North America, as provided to Man and the Business in accordance with recent historical practice, as further specified in Schedule 1.15.

1.16 “ROW Insurance Services” shall mean the services of the insurance department and staff located outside North America, as provided to Man and the Business in accordance with recent historical practice, as further specified in Schedule 1.16.

1.17 “ROW MIS Services” shall mean all telecommunication, computer and data-processing services and support provided to Man and the Business outside North America in accordance with recent historical practice, as further specified in Schedule 1.17.

1.18 “ROW Office Services” shall mean the office space, reception, parking, and related services located outside North America, as further specified in Schedule 1.18.

1.19 “ROW Other Corporate Services” shall mean the employee administrative services, legal advisory services, and treasury management services located outside North America, as further specified in Schedule 1.19.

1.20 “ROW Tax Services” shall mean the services of the internal tax department and staff outside North America, as provided to Man and the Business in accordance with recent historical practice, as further specified in Schedule 1.20.

1.21 “Service Provider” shall mean the party providing a particular Service pursuant to this Agreement.

1.22 “Service Recipient” shall mean the party receiving a particular Service pursuant to this Agreement.

 

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1.23 “Services” shall mean all services provided pursuant to this Agreement, individually and collectively.

1.24 “Westway Services” shall mean the NA HR Services, NA MIS Services, NA Accounting Support Services, NA HSEQ Services, NA Insurance Services, and NA Office Services.

Capitalized terms not expressly defined in this Agreement shall have the meanings ascribed to them in the Transaction Agreement.

 

2.

PROVISION OF SERVICES

2.1 Scheduled Services . Subject to Article 7 hereof, Man will provide to Westway the Man Services, and Westway will provide to Man the Westway Services, commencing with the date hereof and continuing until terminated in accordance with Section 7 hereof. It is understood by the parties that the quantity of Services to be provided under this Section 2.1 shall be substantially consistent with recent historical practice. Where the quantity of Services to be provided to either party is greater than an amount that is substantially consistent with recent historical practice, the party providing such Services reserves the right (after so advising the other party) to utilize third-party providers to provide the Services.

2.2 Unscheduled Services . Man will employ its commercially reasonable efforts to provide such Other Services to Westway as are reasonably requested by Westway. Westway will employ its commercially reasonable efforts to provide such Other Services to Man as are reasonably requested by Man. Other Services provided by one party to the other will be charged based upon the Fully Allocated Cost of such Services based upon actual hours worked, unless otherwise agreed, which agreement shall be pursued in good faith by both parties.

2.3 Consent of Third Parties . The parties’ obligation to deliver any Service described in this Agreement is conditional upon such party’s obtaining the consent, where necessary, of any relevant third party provider, provided, however, that if such consent cannot be obtained, the parties shall use their respective commercially reasonable best efforts to arrange for alternative methods of delivering such Service. For the avoidance of doubt, the party responsible for delivering a particular Service will be responsible for obtaining any required licenses or consents necessary to deliver such Service. Notwithstanding anything herein to the contrary, nothing in this Agreement shall affect Man’s and its affiliates’ obligations to obtain consents pursuant to, and in accordance with, the Transaction Agreement.

2.4 Financial Reporting . With respect to NA Accounting Support Services provided by Westway to Man and ROW Accounting Support Services provided by Man to Westway, all Accounting Support Services and access to accounting information and systems shall be provided, on a time schedule and in a manner consistent with recent historical practice. All third-party invoices, financial reports and accounting information shall be in substantially the form currently provided.

 

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3.

PRICING, BILLING AND PAYMENT

3.1 Fees . All Services will be charged to and payable by recipient of such Services at the Fully Allocated Cost of such Service.

3.2 Payment . Charges for Services shall be billed monthly by the Service Provider and shall be payable by the Service Recipient on the fifteenth day of the month following the month in which such Services are rendered.

3.3 Misdirected Funds . Each party will remit to the other any misdirected funds such other party that it collects, without set-off for charges for Services.

 

4.

WARRANTY, LIABILITY AND INDEMNITY

4.1 Standard of Service . The parties shall provide Services to one another in a manner consistent with the manner they have heretofore been provided. Neither party makes any other warranties, express or implied, with respect to the Services to be provided by such party hereunder.

4.2 Limitation of Liability . The maximum liability of the Service Provider to, and the sole remedy of, the Service Recipient for breach of this Agreement or otherwise with respect to Services is a refund of the price paid for the particular Service or, at the option of Service Recipient, a redelivery (or delivery) of the Service, unless the breach arises out of the gross negligence or willful failure of performance of the Service Provider. In no event shall either party be liable to the other for any consequential, punitive or special damages arising out of this Agreement, whether resulting from negligence or otherwise.

4.3 Indemnity .

(a) Man agrees to indemnify and hold Westway harmless from any damages, loss, cost or liability (including legal fees and expenses and the cost of enforcing this indemnity) arising out of or resulting from a third-party claim regarding Man’s performance, purported performance or nonperformance of this Agreement (whether arising out of Man’s negligence, intentional misconduct, or otherwise), provided, however, that Man will not indemnify Westway to the extent that such third-party claim directly arises out of or results from Westway’s performance, purported performance or nonperformance of this Agreement (whether arising out of Westway’s negligence, intentional misconduct, or otherwise).

(b) Westway agrees to indemnify and hold Man harmless from any damages, loss, cost or liability (including legal fees and expenses and the cost of enforcing this indemnity) arising out of or resulting from a third-party claim regarding Westway’s performance, purported performance or nonperformance of this Agreement (whether arising out of Westway’s negligence, intentional misconduct, or otherwise), provided, however, that Westway will not indemnify Man to the extent that such third-party claim directly arises out of or results from Man’s performance, purported performance or nonperformance of this Agreement (whether arising out of Man’s negligence, intentional misconduct, or otherwise).

 

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5.

FORCE MAJEURE

Either party shall be temporarily excused from performance under this Agreement if any force majeure, including but not limited to disaster, fire, war, civil commotion, strike, labor shortage, slowdown, or the unavailability of labor, governmental regulation, energy shortage, or other occurrence beyond the reasonable control of such party should have happened and made it impossible for such party to perform its obligations under this Agreement. Under such circumstances, performance under this Agreement that relates to the delay shall be suspended for the duration of the delay, provided that the party so affected resumes the performance of its obligations with due diligence as soon as practicable after the effects of such event have been alleviated and provided that no such event shall relieve either party from any of its payment obligations hereunder. In case of any such suspension, the parties shall use their best efforts to overcome the cause and effect of such suspension, but in no event shall either party be required to settle any litigation, strike, lockout or other labor difficulty contrary to its best interests in its sole discretion. The provisions of this Section 5 will not excuse any failure to pay, or delay the time for payment of, any sum of money owing pursuant to this Agreement.

 

6.

PROPRIETARY INFORMATION AND RIGHTS

6.1 Confidentiality . Each party acknowledges that the other possesses, and will continue to possess, information that has been created, discovered or developed by them and/or in which property rights have been assigned or otherwise conveyed to them, which information has commercial value and is not in the public domain. The proprietary information of each party will be and remain the sole property of such party and its assigns. Each party shall use the same degree of care that it normally uses to protect its own proprietary information to prevent the disclosure to third parties of information that has been identified as proprietary by written notice to such party from the other party. Neither party shall make any use of the information on the other which has been identified as proprietary except as contemplated or required by the terms of this Agreement. Notwithstanding the foregoing, this Section 6 shall not apply to any information that a party can demonstrate: (a) was, at the time of disclosure to it, in the public domain through no fault of such party; (b) was received after disclosure to it from a third party who had a lawful right to disclose such information to it; or (c) was independently developed by the receiving party.

6.2 Nonsolicitation of Employees . Each party, on behalf of itself and its affiliates, agrees not to, directly or indirectly, (a) induce or attempt to induce any employee of the other party or its affiliates (individually and collectively, the “Employer”) to leave the employ of the Employer; (b) in any way interfere with the relationship between the Employer and any of its employees; (c) employ or otherwise engage (as an employee, independent contractor or otherwise) any current or former employee of the Employer within six months following such employee’s separation from employment of the Employer; or (d) induce or attempt to induce any customer, supplier, licensee or other person to cease doing business with the other party or its affiliates or in any way interfere with the relationship between any such customer, supplier, licensee or other business entity and the other party or its affiliates.

 

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7.

TERMINATION

7.1 Master Agreement . This is a master agreement and shall be construed as a separate and independent agreement for each and every gro


 
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