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Exhibit 10.5
TRANSITION SERVICES AGREEMENT
TRANSITION
SERVICES AGREEMENT, dated as of October 29, 2004, by and
between Ingersoll-Rand Company Limited, a
company organized under the laws of
Bermuda, on behalf of itself and the other
Sellers (as defined in the Purchase
Agreement) (together with any of its
subsidiaries providing services hereunder,
"Seller"), and Dresser-Rand Group Inc., a
Delaware corporation, on behalf of
itself and the other Buyers (as defined in
the Purchase Agreement) (collectively
with any of their respective subsidiaries
receiving services hereunder,
"Buyer"). Seller and Buyer are sometimes
hereinafter collectively referred to as
the "Parties."
WITNESSETH:
WHEREAS,
Seller and Dresser-Rand Holdings, LLC (f/k/a FRC Acquisitions
LLC) ("Holdings") are parties to an Equity
Purchase Agreement, dated as of
August 25, 2004 (as amended, supplemented
or otherwise modified from time to
time, the "Purchase Agreement"), relating
to the sale by Seller and the other
sellers party thereto, and the purchase and
assumption by Holdings, of the
Business (as defined in the Purchase
Agreement);
WHEREAS,
immediately prior to the Closing (as defined in the Purchase
Agreement), Holdings has entered into an
Assignment Agreement with Buyer, dated
as of October , 2004, whereby Holdings assigned
to Buyer its rights and
obligations under the Purchase Agreement
relating to the purchase of the
Acquired Interests (as defined in the
Purchase Agreement) and entering into any
Transaction Agreements (as defined in the
Purchase Agreement) and any other
agreements in connection therewith; and
WHEREAS,
the Purchase Agreement provides that, in connection with the
consummation of the transactions
contemplated thereby, the Parties will enter
into this Agreement pursuant to which Buyer
will purchase certain services from
Seller during a transition period from the
date hereof;
NOW,
THEREFORE, the Parties hereby agree as follows:
ARTICLE I DEFINITIONS
SECTION
1.1. For the purposes of this Agreement, (a) unless otherwise
defined herein capitalized terms used
herein shall have the meanings assigned to
them in the Purchase Agreement and (b) the
following terms shall have the
meanings hereinafter specified:
"Agreement" shall mean this Agreement, including the Schedules
hereto, as
the same may be amended, supplemented or
otherwise modified from time to time.
"Buyer"
shall have the meaning set forth in the introductory paragraph
hereof.
"Parties"
shall have the meaning set forth in the introductory paragraph
hereof.
"Purchase
Agreement" shall have the meaning set forth in the recitals
hereto.
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"Seller"
shall have the meaning set forth in the introductory paragraph
hereof.
"Service"
or "Services" shall mean those services listed and described on
Schedule A.
SECTION
1.2. Interpretation; Exhibits and Schedules. When a reference
is
made in this Agreement to a Section or a
Schedule, such reference shall be to a
Section of, or a Schedule to, this
Agreement unless otherwise indicated. The
headings contained in this Agreement are
for reference purposes only and shall
not affect in any way the meaning or
interpretation of this Agreement. Whenever
the words "include", "includes" or
"including" are used in this Agreement, they
shall be deemed to be followed by the words
"without limitation." The words
"hereof," "herein" and "hereunder" and
words of similar import when used in this
Agreement shall refer to this Agreement as
a whole and not to any particular
provision of this Agreement. The
definitions contained in this Agreement are
applicable to the singular as well as the
plural forms of such terms and to the
masculine as well as to the feminine and
neuter genders of such term. Any
agreement, instrument or statute defined or
referred to herein shall mean such
agreement, instrument or statute as from
time to time amended, modified or
supplemented. References to a Person are
also to its permitted successors and
assigns and, in the case of an individual,
to his heirs and estate, as
applicable.
ARTICLE II AGREEMENT TO SELL AND BUY
SECTION
2.1. Provision of Services. Seller shall provide to Buyer the
Services (it being understood that Services
rendered for any particular month
shall include the preparation and delivery
of any required reports, filings or
other work related to such month even
though performed after the end of the
particular month in question). The
applicable fee for each Service shall be the
specified fee for such Service set forth in
Schedule A. In addition, it is
understood that Seller shall not be
required to use its own funds for any third
party-provided service that is requested by
Buyer or any payment obligation of
Buyer (including employee compensation
payments, employee benefit payments and
payments to fund checks issued or wire
transfer payments made on behalf of
Buyer). Buyer shall be responsible to
provide Seller with the funds for each
such service and shall be solely
responsible for the payment of any additional
license fees, royalties and other payments
and fees (including licensee fees and
application service provider fees) due
under any license agreement or other
agreement relating to intellectual property
(including software) necessary to
perform the Services incurred after the
prior approval of Buyer as a result of
the performance of the Services for the
Buyer. In every case, all of the
Services shall be provided in accordance
with the terms, limitations and
conditions set forth herein and on Schedule
A. Seller shall maintain all
existing insurance coverages of the types
that relate to the activities
constituting or property relating to the
Services.
SECTION
2.2. Access. Buyer shall make available on a timely basis to
Seller all information and materials
reasonably requested by Seller to enable it
to provide the Services. Buyer shall give
Seller reasonable access, during
regular business hours and at such other
times as are reasonably required, to
the premises of the Business for the
purposes of providing Services.
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SECTION
2.3. Books and Records. Seller shall keep books and records of
the
Services provided and reasonable supporting
documentation of all charges and
expenses incurred in providing such
Services and shall produce written records
that verify the dates and times during
which the Services were performed. Seller
shall make such books and records available
to Buyer, upon reasonable notice,
during normal business hours.
ARTICLE III SERVICES; PAYMENT; INDEPENDENT CONTRACTOR
SECTION
3.1. Service Quality.
(a)
Unless otherwise
agreed in writing by the Parties, the Services
shall be performed by Seller for Buyer in a
manner and quality that are
substantially consistent with Seller's past
practice in performing the Services
for the Business, and Buyer shall use such
Services in substantially the same
manner as they were used by Seller in the
past practice of the Business. Seller
shall act under this Agreement solely as an
independent contractor and not as an
agent of Buyer. All employees and
representatives providing the Services shall
be under the direction, control and
supervision of Seller (and not of Buyer),
and Seller shall have the sole right to
exercise all authority with respect to
such employees and representatives and in
no event shall such employees and
representatives be deemed to be employees
or agents of Buyer.
(b)
Seller shall
have the right to shut down temporarily for routine
maintenance purposes the operation of the
facilities providing any Service
whenever in its judgment, reasonably
exercised, such action is necessary,
provided, that such shut down shall not
adversely and unduly affect Buyer's
operations to which the provision of
Services relate. Seller shall notify Buyer
as much in advance as reasonably
practicable that maintenance is required.
Unless not feasible under the
circumstances, this notice shall be given in
writing. Where written notice is not
feasible, Seller shall give prompt oral
notice to Buyer, which notice shall be
promptly confirmed in writing by Seller.
Seller shall be relieved of its obligations
to provide Services only for the
period of time that its facilities are so
shut down but shall use diligent and
commercially reasonable efforts to minimize
each period of shutdown for such
purpose and to schedule such shutdown so as
not to inconvenience or disrupt the
conduct of the Business by Buyer. Seller
shall consult with Buyer prior to
temporary shutdowns to the extent
reasonably practicable or, if not reasonably
practicable, immediately thereafter in
order to establish alternative sources
for such services. To the extent
commercially reasonable, Seller will afford
Buyer the benefit of any arrangements for
substitute services that Seller makes
on its own behalf.
SECTION
3.2. Payment. Statements will be rendered each month by Seller
to
Buyer for Services delivered during the
preceding month. Each such statement
shall set forth in reasonable detail a
description of such Services and the
amounts charged therefor and shall be
payable 30 days after the date thereof.
Any amount not paid within such 30-day
period, unless such amount is being
challenged, shall be subject to late
charges at a rate of 10% per annum pro
rated for each day that such amount is
overdue.
SECTION
3.3. Priorities. In providing Services, Seller shall accord
Buyer
the same priority it accords its own
operations.
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SECTION
3.4. Taxes. The amounts set forth for each Service on Schedule
A
do not include any Taxes. Any Taxes
required to be charged by Seller under
applicable Law are in addition to the
amounts to be paid by Buyer hereunder for
the Services.
SECTION
3.5. Uses of Services. Seller shall be required to provide
Services only to Buyer in connection with
the Buyer's operation of the Business.
Buyer shall not resell any Services to any
Person whatsoever or permit the use
of the Services by any Person other than in
connection with the operation of the
Business in the ordinary course by Buyer
and its subsidiaries.
ARTICLE IV TERM OF SERVICES
The
provision
