TRANSITION SERVICES AGREEMENT

Exhibit 10.13

 

EXECUTION COPY

 

 

TRANSITION SERVICES AGREEMENT

 

by and among

 

VERIZON INFORMATION TECHNOLOGIES INC.

 

PARADISE HOLDCO, INC.

 

PARADISE MERGERSUB, INC.

 

and

 

VERIZON HAWAII INC.

 

 

May 21, 2004

 

TABLE OF CONTENTS

 

 

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TRANSITION SERVICES AGREEMENT

 

Transition Services Agreement (this “ Agreement ”), dated as of May 21, 2004, by and among Verizon Information Technologies Inc. (“ Supplier ”), Paradise HoldCo, Inc. (“ Buyer ”), Paradise MergerSub, Inc. (“ Merger Sub ,” and, following the Closing, the “ Surviving Corporation ”) and Verizon Hawaii Inc. (“ Verizon Hawaii ”), for purposes of Section 16.4 only.

 

RECITALS

 

WHEREAS, GTE Corporation, Buyer and certain other parties have entered into an Agreement of Merger, dated as of the date hereof (the “ Merger Agreement ”), pursuant to which Merger Sub will be the surviving entity in a merger (“ Merger ”) with Verizon HoldCo and at Closing of said Merger, Buyer will own all of the stock of the Surviving Corporation;

 

WHEREAS, Verizon Hawaii will be a subsidiary of the Surviving Corporation;

 

WHEREAS, after the Merger, the Surviving Corporation and its Affiliates will operate certain businesses including, but not limited to, a local exchange and long distance telephone company in the State of Hawaii;

 

WHEREAS, Supplier and its Affiliates have employees with expertise and capabilities to provide contract administrative support and the Transition Services described herein; and

 

WHEREAS, Buyer, the Surviving Corporation and Supplier (each, a “ party ” and collectively, the “ parties ”) desire to enter into an agreement whereby Supplier and its Affiliates, on the terms and conditions set forth in this Agreement, will provide to the Surviving Corporation, for its account and for the benefit of it and its Affiliates, certain services herein defined as Transition Services.

 

AGREEMENT

 

NOW THEREFORE, in consideration of the mutual promises and covenants contained herein, the parties agree as follows.

 

ARTICLE I

 

DEFINITIONS

 

Capitalized terms used in this Agreement but not defined herein shall have the meanings given them in the Merger Agreement. Other capitalized terms, as used herein, have the meanings set forth below or elsewhere in this Agreement.

 

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“ Agreement ” has the meaning set forth in the preamble hereto.

 

“ Approved Third Party Intellectual Property ” has the meaning set forth in Section 5.1( ii ) hereto.

 

“ Change ” has the meaning set forth in Section 3.2(b) hereto.

 

“ Change of Control ” means ( i ) any transaction or series of transactions in which any person or group (within the meaning of Rule 13d-5 under the Securities Exchange Act and Sections 13(d) and 14(d) of the Securities Exchange Act) that is a direct or indirect “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act), acquires by way of a stock issuance, stock purchase, tender offer, merger, consolidation or other business combination or otherwise, greater than 50% of the total voting power entitled to vote in the election of directors of Buyer, Verizon Hawaii or the Surviving Corporation, ( ii ) any merger, consolidation, reorganization or other business combination with a Person in which Buyer, Verizon Hawaii or the Surviving Corporation does not survive, ( iii ) any merger, consolidation, reorganization or other business combination in which Buyer, Verizon Hawaii or the Surviving Corporation survives, but the shares of common stock outstanding of the Buyer, Verizon Hawaii or Surviving Corporation or its ultimate controlling Affiliate immediately prior to such merger, consolidation, reorganization or other business combination represent 50% or less of the voting power of Buyer, Verizon Hawaii or the Surviving Corporation after such merger, consolidation, reorganization or other business combination and ( iv ) any transaction or series of transactions in which assets comprising more than 50% of the total assets of the Buyer or Surviving Corporation and its Subsidiaries (in value) are sold to another Person.

 

“ Change Request ” has the meaning set forth in Section 3.2(b) hereto.

 

“ Conforming Change ” has the meaning set forth in Section 3.2(a) hereto.

 

“ Cutover ” has the meaning set forth in Section 4.2(a) hereto.

 

“ Cutover Plan ” has the meaning set forth in Section 4.2 hereto.

 

“ Cutover Planning Committee ” has the meaning set forth in Section 4.2(a) hereto.

 

“ Fixed Monthly Service Fee ” has the meaning set forth in Section 2.1(a) hereto.

 

“ Force Majeure Event ” has the meaning set forth in Section 22.14 hereto.

 

“ Initial Payment ” has the meaning set forth in Section 6.2(a) hereto.

 

“ Linked Services ” has the meaning set forth in Section 4.1(a) hereto.

 

“ Linked Services Report ” has the meaning set forth in Section 4.1(a) hereto.

 

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“ Linked Services Report Consideration Period ” has the meaning set forth in Section 4.1(a) hereto.

 

“ Merger ” has the meaning set forth in the Recitals hereto.

 

“ Merger Agreement ” has the meaning set forth in the Recitals hereto.

 

“ Opt-out Notice ” has the meaning set forth in Section 4.1(a) hereto.

 

“ Schedule B Fees ” has the meaning set forth in Section 2.4 hereto.

 

“ Schedule B Services ” has the meaning set forth in Section 2.4 hereto.

 

“ Service Fee ” has the meaning set forth in Section 2.5 hereto.

 

“ Service Modification ” has the meaning set forth in Section 3.2(b) hereto.

 

“ Single Point of Contact ” has the meaning set forth in Section 11.1 hereto.

 

“ Special Services ” has the meaning set forth in Section 2.3 hereto.

 

“ Special Services Fees ” has the meaning set forth in Section 2.3 hereto.

 

“ Special Services Threshold ” has the meaning set forth in Section 2.3(i) hereto.

 

“ Supplier ” has the meaning set forth in the preamble hereto.

 

“ Supplier License Fees ” has the meaning set forth in Section 2.2 hereto.

 

“ Supply Cutover Planning Services ” has the meaning set forth in Section 4.2(a) hereto.

 

“ Surviving Corporation ” has the meaning set forth in the preamble hereto.

 

“ Termination Schedule ” has the meaning set forth in Section 4.1(a) hereto.

 

“ Third Party Vendor Costs ” has the meaning set forth in Section 2.2 hereto.

 

“ Transition Service ” has the meaning set forth in Section 2.1 hereto.

 

“ Unit Based Service Fee ” has the meaning set forth in Section 2.1 hereto.

 

“ Verizon Hawaii ” has the meaning set forth in the preamble hereto.

 

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ARTICLE II

 

TRANSITION SERVICES

 

2.1. Transition Services and Fees .

 

(a) Following the Closing, and subject to the terms and conditions hereof, Supplier shall arrange for, procure, aggregate and otherwise cause its Affiliates and their employees and agents to provide to the Surviving Corporation and its Affiliates for use in the Business during the term hereof, the Services listed on Schedule A (collectively, the “ Transition Services ” and each service, a “ Transition Service ”). Schedule A includes, for each Transition Service, ( i ) a description of the service (or group of related services) to be performed, ( ii ) significant performance requirements of Supplier or its Affiliates and the Surviving Corporation and other special terms and conditions relating directly to the services to be performed, and ( iii ) the base service fee or methodology to calculate the base service fee to be paid to Supplier, including monthly fixed payments (a “ Fixed Monthly Service Fee ”) or per unit fees or costs (a “ Unit Based Service Fee ”) as applicable.

 

(b) Within 60 days following the date hereof, Supplier shall deliver to Buyer additional schedules of Transition Services that will supplement the Services listed on Schedule A, which supplemental schedules shall include, for each supplemental Transition Service: (i) a description of the service (or group of related services) to be performed and (ii) a reference to the significant performance requirements of Supplier or its Affiliates and the Surviving Corporation and other special terms and conditions relating directly to the services to be performed. Such supplemental schedules will include, without limitation, clarification that printed telephone customer bills will include an amount for directory advertisements which amount is timely provided to Supplier by Surviving Corporation in an electronic format compatible with Supplier’s customer telephone billing system. No Fixed Monthly Service Fees or Unit Based Service Fees shall be incurred by Buyer in connection with the performance of the Transition Services set forth on such supplemental schedules. The time spent in preparing such schedules shall be free of charge to Buyer.

 

2.2. Third Party Vendor Costs . In order to provide the Transition Services, the parties acknowledge and agree that it may be necessary for Supplier to pay third party suppliers or vendors incremental or other costs and expenses or new costs or expenses incidental to Supplier’s providing transition support for the Surviving Corporation, including without limitation, programming fees, Taxes, maintenance fees, initiation and set up costs and license fees and costs associated with any Approved Third Party Intellectual Property as described in Article V (such fees, the “ Supplier License Fees ” and collectively with all other amounts referred to in this Section 2.2, the “ Third Party Vendor Costs ”). Such amounts shall be included in the amounts payable to Supplier pursuant to Article VI, provided that in the event that Third Party Vendor Costs

 

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(excluding Taxes and Supplier License Fees) total $5,000,000 in the aggregate under this Agreement, Supplier shall promptly notify Surviving Corporation of such amounts and if Surviving Corporation refuses to include all amounts in excess of such $5,000,000 in Third Party Vendor Costs (excluding Taxes and Supplier License Fees), Supplier may cease to procure services on behalf of the Surviving Corporation that incur such Third Party Vendor Costs; provided further that if Surviving Corporation approves such Third Party Vendor Costs (excluding Taxes and Supplier License Fees) in excess of $5,000,000 in the aggregate, then Supplier shall promptly notify Surviving Corporation in the event that Third Party Vendor Costs (excluding Taxes and Supplier License Fees) in excess of such $5,000,000 in the aggregate under this Agreement total $1,500,000, and thereafter in such $1,500,000 intervals. If Surviving Corporation refuses to include all amounts in excess of any such $1,500,000 interval in Third Party Vendor Costs (excluding Taxes and Supplier License Fees), Supplier may cease to procure services on behalf of the Surviving Corporation that incur such Third Party Vendor Costs.

 

2.3. Special Services Fees . Buyer, the Surviving Corporation or its representatives may request that Supplier or its Affiliates (1) participate in meetings, telephone calls, training or other consultations which may be (a) necessary for Supplier and its Affiliates or the Surviving Corporation to perform their requirements as described in Schedule A, (b) desirable to the Surviving Corporation in order to perform its requirements described in Schedule A or (c) desirable to the Surviving Corporation in connection with the usage of the Verizon Proprietary Software or (2) prepare a Linked Services Report as contemplated in Section 4.1 (all such services in clauses (1) and (2), the “ Special Services ”). Supplier and its Affiliates shall provide reasonable services as requested in accordance with the following terms:

 

(i) from the date hereof until 30 calendar days following the Closing, at no charge, unless and until the total time spent by Supplier and its Affiliates for such Special Services exceeds 1,500 documented hours (the “ Special Services Threshold ”), in which case Buyer or the Surviving Corporation, as the case may be, shall pay Seller for all such time relating to the provision of such Special Services in excess of the Special Services Threshold at the rate of $85 per hour; and

 

(ii) from 30 calendar days following the Closing until the end of the term of this Agreement, at the rate of $85 per hour; provided that if the total time spent by Supplier and its Affiliates for Special Services pursuant to clause (i) above does not exceed the Special Services Threshold, then from 30 calendar days following the Closing until the end of the term of this Agreement the time spent by Supplier and its Affiliates rendering Special Services in connection with the Verizon Proprietary Software shall be at no charge, unless and until the total time spent by Supplier and its Affiliates in connection with the Verizon Proprietary Software exceeds the remaining hours available under the Special

 

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Services Threshold, and then Surviving Corporation shall pay Seller for all such time at the rate of $85 per hour (such fees for Special Services under clauses (i) and (ii) of this Section 2.3, and any amount payable pursuant to the immediately following paragraph, the “ Special Services Fees ”)

 

In addition to any amounts payable pursuant to clause (i) and (ii), Buyer or the Surviving Corporation, as the case may be, shall reimburse the Seller for all reasonable pre-approved out-of-pocket travel related costs in connection with providing any Special Services hereunder. For the avoidance of doubt, ( x ) the time spent by the Supplier in preparing a Linked Services Report, if requested, shall be included in the calculation of time spent by the Supplier for Special Services; provided that, notwithstanding anything to the contrary, no more than 750 hours of the time spent in preparing the Linked Services Report shall count towards the Special Services Threshold, and any time spent in preparing the Linked Services Report that is in excess of 750 hours shall be free of charge to Buyer or Surviving Corporation and ( y ) the time spent by the Cutover Planning Committee in preparing the Cutover Plan shall not be included in the calculation of time spent by the Supplier for Special Services.

 

2.4. One Time Fees . Prior to the Closing, Supplier and its Affiliates shall provide services associated with account/program transition management and isolation of user access as listed in Schedule B (the “ Schedule B Services ”) for the one-time fees described on Schedule B (the “ Schedule B Fees ”), which fees are exclusive of Taxes. Buyer or the Surviving Corporation shall pay Supplier the Schedule B Fees in accordance with Section 6.1.

 

2.5. Service Fee . Supplier shall administer this Agreement with respect to the delivery of Transition Services. As more fully described in Article XI and subject to specific arrangements set forth in Schedule A, Supplier will coordinate all communications, questions and problem resolution with respect to all Transition Services. The Surviving Corporation shall pay Supplier for Unit Based Service Fees, Special Service Fees, Fixed Monthly Service Fees and Third Party Vendor Costs for each Transition Service as hereinafter described in Article VI (collectively, the “ Service Fee ”). Without limiting the obligation of the Surviving Corporation under Article VI, Supplier shall be responsible to pay its Affiliates for any Transition Services or Special Services provided and third party vendors for Third Party Vendor Costs. The Service Fee is exclusive of any Taxes.

 

2.6. Supplier Cutover Planning Services . Supplier will provide the Supplier Cutover Planning Services described in Article IV at no additional cost.

 

2.7. Performance by Surviving Corporation . Subject to Section 14.2, the Surviving Corporation agrees to perform in a timely fashion those tasks, and to provide the personnel, facilities and accurate information, as are expressly set forth in Schedule A. In addition, the Surviving Corporation agrees to use commercially reasonable efforts

 

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to cooperate with Supplier and its Affiliates, and to perform in a timely fashion, those additional commercially reasonable tasks directly related to the Transition Services which Supplier may request. For purposes of clarity, the obligation of Surviving Corporation to use commercially reasonable efforts as described in the preceding sentence shall be satisfied if Surviving Corporation performs such tasks in a manner similar to how such tasks are performed by Parent’s West region telephone operations Affiliates (including those in California, Texas and the Pacific Northwest) which are receiving services similar to the Transition Services from Supplier’s Affiliates.

 

ARTICLE III

SCOPE OF SERVICES; CHANGES

 

3.1. General Scope . Transition Services include only services and functions as were provided to Verizon Hawaii and /or its Affiliates, as applicable, on the date immediately prior to the Closing Date, unless the service descriptions on Schedule A specifically indicate otherwise. Unless specifically set forth on Schedule A or specifically allowed or agreed pursuant to the provisions hereof, neither Supplier nor its Affiliates will provide any additional, modified, general or customized services.

 

3.2. Changes in Scope .

 

(a) The parties acknowledge and agree that Supplier and its Affiliates shall initially provide the Transition Services utilizing systems and databases used to support Verizon Hawaii (and the Contributing Companies as to the respective service they received) immediately prior to the Closing Date and will adhere to the policies, practices and methodologies used to support Verizon Hawaii immediately prior to the Closing Date. During the term of this Agreement, Supplier may at any time modify the Transition Services, as necessary or desirable, to allow for continued or conforming use of the then-existing systems and databases and to allow for continued or conforming adherence to the then-existing policies, practices and methodologies, which Supplier or its Affiliates then use to provide similar services to Parent’s West region telephone operations Affiliates (each, a “ Conforming Change ”), provided , that the Conforming Change complies with applicable Law and Surviving Corporation shall not be responsible for any additional costs in connection with such Conforming Change and Supplier shall reimburse Surviving Corporation for all reasonable out-of-pocket costs in connection with the implementation of such Conforming Change. Prior to the implementation of a Conforming Change, Supplier will provide the Surviving Corporation with written notice of such change contemporaneously with the notice provided to Parent’s West region telephone operations Affiliates.

 

(b) In addition to Conforming Changes, during the term, the parties may, in accordance with the procedures specified in this Article III, ( i ) mutually agree in writing to modify the terms and conditions relating to any of the Transition Services (a “ Service Modification ”) or ( ii ) mutually agree in writing upon the terms and conditions relating to

 

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the provision of services that are in addition to any Transition Services (an “ Additional Service ”). In the event either of the parties desires a Service Modification or an Additional Service (in each case, a “ Change ”), the party requesting the Change shall deliver a written description of the proposed Change (each, a “ Change Request ”) to the other party’s Single Point of Contact (as defined in Article XI).

 

(c) All Change Requests by either party must be consented to by the other party’s Single Point of Contact in writing before either party has any obligation with respect to the proposed Change. Either party may decline to consent to any Change Request for any reason in its sole discretion. A party that is requested to provide its consent to a Change Request will not unreasonably delay in responding to such request. Notwithstanding the foregoing, Supplier shall not withhold its consent to any Service Modification requested by Surviving Corporation that is required to comply with the requirements of a Governmental Authority or applicable Law, and the Surviving Corporation agrees to reimburse Supplier for its increased costs associated with such Service Modification.

 

(d) If a Conforming Change occurs or a Change Request is approved in accordance with this Article III, the definition of Transition Services and Schedule A will be deemed amended to reflect the implementation of the Conforming Change or Change Request as well as any other terms and conditions agreed upon by the parties in writing.

 

ARTICLE IV

PRE-CLOSING REPORTS

 

4.1. Linked Services Report .

 

(a) Within five calendar days following the date hereof, Buyer may, at its option, request from Supplier good faith determinations of whether certain Transition Services are linked to other Transition Services (such linked services, “ Linked Services ” and such determinations, a “ Linked Services Report ”). In such case, during the 30 calendar days following receipt of such request, Seller shall prepare a Linked Services Report and provide the Buyer with two interperiod progress reports with respect to the Linked Services Report, and Buyer may request to narrow the scope of the Linked Services Report based on such interim reports. Within fourteen (14) days following delivery by Seller of the Linked Services Report (such period, the “ Linked Services Report Consideration Period ”), the Buyer shall ( i ) deliver to the Supplier a proposed termination schedule with respect to the Transition Services (the “ Termination Schedule ”) and ( ii ) notify the Supplier of any Transition Services that Surviving Corporation irrevocably elects not to receive upon the Closing (such election, the “ Opt-out Notice ”), it being understood that such election shall include all Linked Services related to the Transition Service that the Surviving Corporation elects not to receive. During the Linked Services Report Consideration Period, Seller shall cooperate to assist the Buyer in understanding the Linked Services Report.

 

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(b) If Buyer does not request a Linked Services Report in accordance with Section 4.1(a), then the Surviving Corporation shall receive all Transition Services upon Closing.

 

4.2. Cutover Plan .

 

(a) Within 10 calendar days following the date hereof, a committee (the “ Cutover Planning Committee ”), as contemplated in Section 5.11 of the Merger Agreement, shall be formed and shall hold its initial meeting to commence planning and preparation for the Surviving Corporation to cease using all Transition Services and to operate the Business using Surviving Corporation’s own systems and services or those of some other third party (the “ Cutover ” and such services provided by the Supplier in connection with the Cutover, the “ Supplier Cutover Planning Services ”).

 

(b) Each party (the Buyer and the Surviving Corporation on the one hand and the Supplier on the other hand) shall designate a team of persons for representation in the Cutover Planning Team (such team, a “ Cutover Team ”). Each party shall designate a member of the Cutover Team as team leader (“ Team Leader ”) who shall have the primary responsibility and accountability for making team assignments, coordinating communications between teams, and assessing and reporting progress toward meeting the plans and objectives of the Cutover Plan as described below.

 

(c) The Cutover Teams and Team Leaders shall cooperate with each other and work together in good faith in the development of a written joint report of the plan to implement the Cutover (the “ Cutover Plan ”). The Cutover Planning Committee shall deliver the Cutover Plan to the Buyer and the Supplier within 60 calendar days following the initial meeting of the Cutover Planning Committee; provided that if the Buyer requests a Linked Services Report pursuant to Section 4.1, then the Cutover Planning Committee shall deliver the Cutover Plan no later than 60 calendar days following the later to occur of: ( i ) receipt by the Supplier of the Termination Schedule and ( ii ) receipt by the Supplier of ( x ) notification from the Buyer not to deliver an Opt-Out Notice or ( y ) an Opt-Out Notice, if any; and provided further, that the Cutover Planning Committee shall revise the Cutover Plan as necessary during the term of this Agreement. In addition to the initial meeting, the Cutover Teams shall convene meetings periodically as required. Meetings may be face to face or telephonic meetings.

 

(d) The Cutover Plan will include, without limitation, a plan for: ( i ) the termination of certain Transition Services and related Linked Services in accordance with a schedule based on the Termination Schedule to the extent commercially reasonable to the Supplier, taking into account the then existing obligations of Supplier and its Affiliates, related and unrelated to this Agreement, ( ii ) with respect to electronic databases of the Business that are used with the Verizon Proprietary Software, the migration of such databases to the Surviving Corporation or its designee for continued use with the Verizon Proprietary Software without any change in form, format or content,

 

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( iii ) with respect to all other electronic databases of the Business, the extraction of data contained in such databases and the transfer of such data to the Surviving Corporation or its designee in a flat data file format, and ( iv ) a plan for the completion and publication of any print phone directories of the Company and its Subsidiaries that are in process as of the Closing Date. The Cutover Teams will be accountable to oversee the implementation of the Cutover Plan.

 

ARTICLE V

 

INTELLECTUAL PROPERTY

 

5.1. Third Party Intellectual Property . Buyer and the Surviving Corporation understand that certain rights and licenses to use Third Party Intellectual Property are required to provide Transition Services, and that, except as specifically contemplated by Section 5.20(b) of the Merger Agreement, the Surviving Corporation shall not be entitled to have possession of or use the Company’s or its Subsidiaries’ Third Party Intellectual Property after Closing unless the Surviving Corporation or its Affiliates have separate licenses from the third parties. As a result:

 

(i) Supplier or its Affiliates shall, within 90 calendar days of the date hereof, provide Buyer with ( i ) a list of the Third Party Intellectual Property required to provide Transition Services (identifying, where applicable, specific product names, version numbers, quantities required (e.g., number of licensed seats, CPUs or MIPS, as applicable) and maintenance and support levels), ( ii ) a reasonable approximation of the license fees, annual maintenance and support costs with respect to each item of such Third Party Intellectual Property, and ( iii ) identification of any consents, rights or licenses that would need to be obtained with respect to such Third Party Intellectual Property in order to provide Transition Services;

 

(ii) Buyer shall, during the 30 calendar days following receipt of such list, notify Supplier in one or more written notifications as to particular items of listed Third Party Intellectual Property that it approves for licensing (such approved Third Party Intellectual Property, the “ Approved Third Party Intellectual Property ”), it being understood that if Buyer does not notify Supplier of its approval with respect to a particular item of Third Party Intellectual Property within such 30-day period, it shall be deemed to have not approved such item of Third Party Intellectual Property and in such event, the conditions set forth in Section 5.3 shall not have been satisfied with respect to such item of Third Party Intellectual Property; and

 

(iii) Supplier or its Affiliates shall, during a 60 calendar day period after obtaining Buyer’s approval with respect to a particular item of Approved Third Party Intellectual Property, promptly commence commercially reasonable

 

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efforts to obtain, if necessary, at Buyer’s sole cost and expense, any necessary rights or licenses to use such Approved Third Party Intellectual Property to provide Transition Services to the Surviving Corporation. In connection with obtaining the necessary rights or licenses to use the Approved Third Party Intellectual Property, the Supplier agrees to request in writing from the third party, to the extent requested by Buyer, ( x ) a provision in the license agreement that permits early termination of such license without penalty; ( y ) a provision in the license agreement that permits assignment of the license and any pre-paid maintenance and support to Surviving Corporation or its Affiliates without additional payments; and ( z ) the waiver of fees for the right to use Approved Third Party Intellectual Property already in possession of Supplier or its Affiliates for the benefit of Surviving Corporation during the term hereof. It is agreed and understood that the Supplier shall have no obligation to undertake negotiations with respect to the requests to be made pursuant to clauses (x), (y) and (z) of this Section 5.1(iii); provided that Supplier shall use commercially reasonable efforts to communicate to Buyer any counter offers made by such third party and Buyer may negotiate directly with such third party with respect to such counter offers; provided further that such negotiations shall be completed prior to the end of such 60 calendar day period. Surviving Corporation agrees to cooperate as reasonably necessary to assist Supplier with obtaining such licenses. Supplier shall not obtain Third Party Intellectual Property in connection with the provision of Transition Services if it knows that the Buyer or Surviving Corporation already has (or will have immediately following Closing) rights to such Third Party Intellectual Property.

 

5.2. Alternatives . If any Third Party Intellectual Property is not available to Supplier for any reason, Supplier shall suggest specific product alternatives or alternative providers, if known, and if available, provide such information to the Surviving Corporation within 120 calendar days of the date hereof for approval in accordance with Section 5.1(ii). If there is no such alternative, then Buyer may suggest an appropriate alternative for Supplier’s approval, which approval shall not be unreasonably withheld. If (a) there is no such alternative and (i) Buyer does not suggest an appropriate alternative or (ii) Supplier does not approve Buyer’s suggestion; or (b) the Buyer does not approve the alternative provided by Supplier, then such related Transition Service and Linked Services (if applicable) shall not be provided. If Third Party Intellectual Property is only available to be licensed directly by Surviving Corporation, Supplier shall so notify Surviving Corporation and Surviving Corporation shall obtain for its own account and at its cost and expense (not as a Supplier License Fee) such Third Party Intellectual Property and the right for Supplier to use such Third Party Software in the provision of Transition Services.

 

5.3. Conditions . Supplier’s agreement to provide each Transition Service shall be contingent upon ( i ) receiving the Surviving Corporation’s written approval in

 

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accordance with Sections 5.1 and 5.2 to obtain, for its account, all required Third Party Intellectual Property and ( ii ) provided that Supplier complies with its obligations hereunder, obtaining on or prior to the Closing Date, necessary rights or licenses for Third Party Intellectual Property. In the event that either the Surviving Corporation’s approval is not timely obtained or the licenses cannot be obtained, Supplier shall not provide any related Transition Service which cannot be performed without such license and any Linked Services, and the Surviving Corporation shall not be obligated to pay any Service Fees therefor.

 

ARTICLE VI

 

PAYMENT FOR TRANSITION SERVICES

 

6.1. Payment Upon Termination . In the event that th