Exhibit 10.1
TRANSITION SERVICES
AGREEMENT
THIS TRANSITION SERVICES
AGREEMENT (this “Agreement”) is dated as of this
30th day of April, 2004, by and between PHARMACOPEIA, INC.,
a Delaware corporation (“Pharmacopeia”), and
ACCELRYS INC., a Delaware corporation and a wholly owned
subsidiary of Pharmacopeia (Pharmacopeia and Accelrys Inc. are
referred to herein collectively as “Accelrys”), on the
one hand, and PHARMACOPEIA DRUG DISCOVERY, INC., a Delaware
corporation (“PDD”), on the other hand. Each of
Accelrys and PDD is sometimes hereinafter referred to as a
“Party” and together as the
“Parties.”
WHEREAS, the Parties have entered into a Master
Separation and Distribution Agreement (the “Distribution
Agreement”) pursuant to which Pharmacopeia has agreed to
distribute to its stockholders all of the outstanding shares of
common stock of PDD (the “Distribution”);
WHEREAS, Pharmacopeia and Accelrys Inc., on the one hand,
and PDD, on the other hand, have historically provided or shared,
and currently provide or share, certain services to or with each
other;
WHEREAS, in recognition of the historic and current
relationship between the businesses, PDD is interested in receiving
certain services from Accelrys, and Accelrys is interested in
providing such services to PDD, during a transition period
commencing on the date of the Distribution (the “Distribution
Date”); and
WHEREAS, in recognition of the historic and current
relationship between the businesses, Accelrys also is interested in
receiving certain limited services from PDD, and PDD is interested
in providing such services to Accelrys, during such transition
period;
NOW, THEREFORE,
in consideration of the mutual
covenants and agreements, and upon the terms, and subject to the
conditions, hereinafter set forth, the Parties hereby agree as
follows:
Article 1
SERVICES
1.1.
Provision of Services
. During the Transition Period
(as defined below), subject to the terms and conditions of this
Agreement, (a) Accelrys agrees to provide to PDD and PDD agrees to
receive from Accelrys the services described in Exhibit A hereto
(each, an “Accelrys Service” and together, the
“Accelrys Services”), and (b) PDD agrees to provide to
Accelrys and Accelrys agrees to receive from PDD the services
described in Exhibit B hereto (each, a “PDD Service and
together, the “PDD Services”). Each Accelrys
Service and PDD Service (as applicable, a “Service”)
shall be provided in good faith and at a level and quality
comparable to that performed by Accelrys or PDD, as applicable,
prior to the date of this Agreement, unless the Parties otherwise
agree in writing. Each of Exhibit A and Exhibit B hereto is
incorporated into and constitutes a part of this
Agreement.
1.2.
Consideration for
Services .
a.
In consideration of the mutual
covenants, agreements, undertakings, representations and warranties
of the Parties set forth in the various agreements entered into in
connection with the Distribution, including, without limitation,
the Distribution Agreement and the agreements referenced therein,
Accelrys and PDD expressly agree that, except to the extent
specifically set forth in Exhibit A hereto, no fee shall be payable
by PDD to Accelrys in exchange for or in consideration of the
provision by Accelrys of any Accelrys Service and no fee shall be
payable by Accelrys to PDD in exchange for or in consideration of
the provision by PDD of any PDD Service.
b.
The Parties also agree to the
Service acquisition and funding arrangements set forth on Exhibit C
hereto, which is incorporated into and constitutes a part of this
Agreement.
1.3.
Access . Each of PDD and Accelrys will make
available to the other Party all information and materials
reasonably requested by such other Party to enable it to provide
the Accelrys Services and the PDD Services, respectively.
Each of PDD and Accelrys will provide the other Party with
reasonable access, upon reasonable prior notice, to its premises to
the extent necessary for the purpose of providing the relevant
Services.
1.4.
Independent
Contractors . In
performing any service on behalf of the other Party, each of PDD
and Accelrys will act under this Agreement solely as an independent
contractor, and not as an agent of the Party for which the
applicable Services are performed.
1.5.
Additional Resources Resulting
From Changes in Business . If it is necessary for either Accelrys
or PDD to increase staffing or acquire equipment or make any
investments or capital expenditures to accommodate an increase in
the use of any Service beyond the level of use of such Service
prior to the Distribution Date, as a result of an increase in
volume of the business or a change in the manner in which the
business is being conducted, such Party will inform the other Party
in writing of such increase in staffing level, equipment
acquisitions, investments or capital expenditures before any such
cost or expense is incurred. Upon mutual agreement of the
Parties acting in good faith as to the necessity of any such
increase, the Party to receive such Service will advance to the
Party to provide the Service an amount equal to the actual costs
and expenses to be incurred in connection therewith. If such
mutual agreement is not reached, the obligation of the Party
required hereunder to furnish or cause to be furnished such Service
will be limited to the level of use of such Service in effect prior
to the proposed increase.
1.6.
Cooperation
. The Parties will use good
faith efforts to reasonably cooperate with each other in all
matters relating to the provision and receipt of Services.
Such cooperation will include seeking or applying for all consents,
licenses or approvals necessary to permit each Party to perform its
obligations hereunder. The Parties will, for a period of five
years after the Distribution Date, maintain documentation
supporting the information contained in the Exhibits hereto and
cooperate with each other in making such information available as
needed, subject to appropriate confidentiality
requirements.
1.7.
Disclaimer of Warranty
. EXCEPT AS EXPRESSLY SET
FORTH IN THIS AGREEMENT, THE SERVICES TO BE PROVIDED UNDER THIS
AGREEMENT ARE FURNISHED AS IS, WHERE IS, WITH ALL FAULTS AND
WITHOUT WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING ANY
WARRANTY OF MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR
PURPOSE.
Article 2
TERM OF SERVICES
2.1.
Transition Period; Early
Termination . The
provision of Services will commence on the Distribution Date and
will terminate no later than the first anniversary of the
Distribution Date (such period being referred to herein as the
“Transition Period”), unless earlier terminated by the
Party receiving the Service(s) or extended by mutual written
agreement of the Parties. In this connection, any Service may
be cancelled or reduced in amount or scope by the recipient of the
Service upon its provision of advance written notice thereof to the
Service provider.
Article 3
LIABILITIES
3.1.
Consequential and Other
Damages . No
provider of any Service hereunder will be liable to any person,
whether in contract, tort (including negligence and strict
liability) or otherwise, but excluding gross negligence, willful
misconduct or bad faith, in connection with the provision of
any
2
Service pursuant to this Agreement, for any
special, indirect, incidental or consequential damages whatsoever
which in any way arise out of, relate to or are a consequence of
the performance or nonperformance by such Service provider
hereunder or the provision of, or failure to provide, any Service
hereunder, including with respect to loss of profits, business
interruptions or claims of customers (other than, with respect to
customers, the Service recipient in its capacity as a customer of
the Service provider).
3.2.
Limitation of
Liability . Except
as set forth in this Agreement (including, without limitation,
Exhibits A and C hereto), the liability of any provider of Services
with respect to this Agreement or any act or failure to act in
connection herewith (including, but not limited to, the performance
or breach hereof, but excluding gross negligence, willful
misconduct or bad faith in connection with the provision of or
failure to provide any Service pursuant to this Agreement), or from
the sale, delivery, provision or use of any Service provided under
or covered by this Agreement, whether in contract, tort (including
negligence and strict liability) or otherwise, will be limited to
the obligation to re-perform the Service as contemplated by
Section 3.3 below.
3.3.
Obligation To
Re-perform . In the
event of any breach of this Agreement by any provider of Services
with respect to the provider’s obligation hereunder to
provide any Service (which breach such Service provider can
reasonably be expected to remedy through the re-performance of the
Service in a commercially reasonable and timely manner), the
Service provider will promptly correct in all material respects
such breach or re-perform in all material respects such Service,
subject to Section 3.2, at the request of the recipient of the
Service and at the expense of the Service provider. To be
effective, any such request by a recipient of Services must be in a
written notice that specifies in reasonable detail the particular
error, defect or breach and be delivered to the Service provider no
more than sixty (60) days from the date such Service was
provided. Notwithstanding anything to the contrary contained
in this Agreement (including, without limitation, this
Section 3.3 and Section 3.2 above), nothing contained in
this Agreement shall be construed to limit PDD’s ability to
utilize the Services Fund to secure Services or acquire assets
under the circumstances set forth in Exhibit C hereto
3.4.
Release and Indemnity
. Except as specifically set
forth in this Agreement, PDD hereby releases Accelrys and each of
Accelrys’
