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Exhibit 10.2
Transition Services Agreement
PDL BioPharma, Inc.,
a Delaware corporation
and
Facet Biotech Corporation,
a Delaware
corporation
Dated as of December 18, 2008
Transition Services Agreement
This Transition Services Agreement (this " Agreement ")
is entered into as of December 18, 2008, by and between PDL
BioPharma, Inc., a Delaware corporation (" PDL "), and
Facet Biotech Corporation, a Delaware corporation (" Facet
"), each a " Party " and together, the " Parties
". Capitalized terms not defined herein shall have the
meaning set forth in that certain Separation and Distribution
Agreement dated as of December 17, 2008 by and between the Parties,
as amended or otherwise modified from time to time (the "
Separation Agreement "). This Agreement shall be
effective on the Distribution Date, as defined in the Separation
Agreement.
Recitals:
WHEREAS, the Board of Directors of PDL has determined that it is
appropriate, desirable and in the best interests of PDL and its
stockholders to separate PDL into two separate, independent and
publicly traded companies;
WHEREAS, to effect this separation the Parties entered into the
Separation Agreement;
WHEREAS, the Parties have agreed to enter into this Agreement in
order for PDL to assist Facet, and for Facet to assist PDL, each
for a period from and after the Distribution Date, by providing to
Facet and PDL, respectively, certain services and support not
otherwise specified in the Separation Agreement or any other
Ancillary Agreement.
NOW, THEREFORE, in consideration of the foregoing premises, the
mutual promises and covenants hereinafter set forth, and other good
and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Parties, intending to be legally
bound, agree as follows:
Article 1
Definitions
As used in this Agreement, the following capitalized terms shall
have the following meanings:
1.1
" Additional Service " shall have the meaning set forth in
Section 2.7(a).
1.2
" Agreement Dispute " shall have the meaning set forth in
Section 11.
1.3
" Business " shall mean the PDL Business or the Facet
Business, as applicable.
1.4
" Default Interest Rate " shall have the meaning set forth
in Section 3.2(b).
1.5
" Due Date " shall have the meaning set forth in
Section 3.2(a).
1.6
" Facet Project Manager " shall have the meaning set forth
in Section 2.9.
1.7
" Facet Services " shall mean the enumerated services
described on Schedule B attached hereto.
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1.8
" Fee " or " Fees " shall have the meaning set forth
in Section 3.1(a).
1.9
" Force Majeure " shall mean, with respect to a Party, an
event beyond the reasonable control of such Party (or any Person
acting on its behalf), which by its nature could not have been
foreseen by such Party (or such Person), or, if it could have been
foreseen, was unavoidable, and includes acts of God, storms,
floods, earthquakes, hurricanes, riots, pandemics, fires, sabotage,
strikes, lockouts, civil commotion or civil unrest, interference by
civil or military authorities, acts of war (declared or undeclared)
or armed hostilities or other national or international calamity or
one or more acts of terrorism.
1.10 " PDL
Project Manager " shall have the meaning set forth in
Section 2.9.
1.11 " PDL
Services " shall mean the enumerated services described on
Schedule A attached hereto.
1.12 "
Schedules " shall mean Schedule A and
Schedule B attached hereto.
1.13 "
Service " shall mean any of the Facet Services or the PDL
Services, as applicable.
1.14 "
Service Provider " shall mean PDL with respect to the PDL
Services, and Facet with respect to the Facet Services.
1.15 "
Service Recipient " shall mean Facet with respect to the PDL
Services, and PDL with respect to the Facet Services.
1.16 "
Services Group " shall mean any Services or group of
Services identified on one of the Schedules for which a single,
separate Fee is specified on such Schedule.
1.17 "
Services Term " shall have the meaning set forth in
Section 4.1.
Article 2
Services
2.1
Scope of Services .
(a)
Facet hereby retains PDL to provide, and PDL hereby agrees to
provide, the PDL Services to Facet or any of its Subsidiaries, as
designated by Facet, during the relevant Services Term.
(b)
PDL hereby retains Facet to provide, and Facet hereby agrees to
provide, the Facet Services to PDL or any of its Subsidiaries, as
designated by PDL, during the relevant Services Term.
(c)
Notwithstanding anything to the contrary in this Agreement,
(i) the PDL Services shall be available to Facet or any of its
Subsidiaries only for the purposes of conducting the Facet Business
substantially in the same manner as it was conducted immediately
prior to the Distribution Date; and (ii) the Facet Services
shall be available to PDL or any of its Subsidiaries
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only for the purposes of conducting the PDL Business
substantially in the same manner as it was conducted immediately
prior to the Distribution Date.
2.2
Provision of Services . The PDL Services may be
directly provided by PDL or may be provided through any of its
Affiliates or subcontractors, and the Facet Services may be
directly provided by Facet or may be provided through any of its
Affiliates or subcontractors; provided , however ,
that the applicable Service Provider shall remain responsible, in
accordance with this Agreement, for performance of any Service it
causes to be so provided.
2.3
No Assumption or Modification of Obligations . Nothing
herein shall be deemed to (a) constitute the assumption by
Service Provider or any of its Affiliates, or the agreement to
assume, any duties, obligations or liabilities of Service Recipient
or its Affiliates whatsoever; or (b) alter, amend or otherwise
modify any obligation of PDL or Facet, as the case may be, under
the Separation Agreement.
2.4
Application of Resources . Unless otherwise expressly
required under the terms of the Separation Agreement or any
Schedules, or otherwise agreed to by the Parties in writing, in
providing the Services, Service Provider or its Affiliates shall
not be obligated to: (a) expend funds and other resources
beyond levels that would be customary and reasonable for any other
nationally recognized service provider to perform services that are
similar to the relevant Services; (b) maintain the employment
of any specific employee or subcontractor; provided, however that
Service Provider shall use commercially reasonable efforts to
provide a replacement with the necessary skill and expertise;
(c) purchase, lease or license any additional (measured as of
the date hereof) equipment or materials (but expressly excluding
any renewal or extension of any leases or licenses required for
Service Provider to perform the relevant Services during the
relevant Services Term); (d) pay any of Service
Recipient’s costs related to its or any of its
Subsidiaries’ receipt of the Services; (e) lend any
funds to a Service Recipient or its Subsidiaries; or (f) make
any payments or disbursements on behalf of Service Recipient,
except to the extent Service Recipient has previously delivered to
Service Provider sufficient funds to make any such payment or
disbursement.
2.5
Performance of Services . Subject to the other terms
(a) in this Agreement setting forth and circumscribing Service
Provider’s performance obligations hereunder (including in
this Article 2 and in Article 6), and (b) in the
relevant Schedules, each Service Provider shall perform the
Services required to be provided by it hereunder in a manner
specifically described in the relevant Schedules, or, to the extent
not so described in such Schedules, in a manner that is
substantially the same in nature, accuracy, quality, completeness,
timeliness, responsiveness and efficiency with how such relevant
Services have been rendered in support of the Facet Business and/or
the PDL Business prior to the Distribution Date. To the
extent that either PDL or Facet determines that any sharing of
information or historical knowledge would be commercially
detrimental in any material respect, violate any Law or agreement
or waive any attorney-client privilege, the work product doctrine
or other applicable privilege, the Parties shall take all
reasonable measures to permit the compliance with such obligations
in a manner that avoids any such harm or consequence.
2.6
Transitional Nature of Services; Changes . The Parties
acknowledge the transitional nature of the Services and agree that,
notwithstanding anything to the contrary
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herein, each Service Provider may make changes from time to time
in the manner of performing the Services if such Service Provider
is making similar changes in performing similar services for itself
and/or its Subsidiaries; provided that Service Provider must
provide Service Recipient with at least thirty (30) days prior
written notice of material changes and reasonably cooperate with
Service Recipient in adjusting to such change.
2.7
Additional Services; Extension of Services Terms . In
the event that the Parties identify and agree upon (a) an
additional service to be provided under this Agreement, as well as
the related fees and other specific terms and conditions applicable
thereto (an " Additional Service "), or (b) an
extension of any particular Service Term for any Services Group, as
well as the related fees and other specific terms and conditions
applicable thereto, the Parties shall execute an amendment to this
Agreement that provides for the substitution of the relevant
Schedule, or additions of supplements to the relevant Schedule, in
order to describe such Additional Service or extension, and the
agreed upon related fees and other specific terms and conditions
applicable thereto. It is understood that the Service Provider has
no obligation to provide Additional Services and may reject any
request by any Service Recipient for Additional Services for any
reason or for no reason.
2.8
Impracticability . Subject to the provisions of
Section 2.10, Service Provider shall not be required to
provide any Service to the extent: (a) that the performance of
the Services would (i) require Service Provider or any of its
Subsidiaries to violate any applicable Laws (including any
applicable codes or standards of conduct established by any
Governmental Entity with respect to their activities subject to the
jurisdiction of such Governmental Entity) or any internal policy
reasonably adopted in order to comply with any applicable Laws;
(ii) result in the breach of any software license, lease, or
other Contract; or (iii) require prior approval of a
Governmental Entity (except to the extent such approval has already
been obtained); or (b) that Service Provider cannot provide
such Service due to a Force Majeure event; provided, however that
Service Provider shall resume such Service as soon as practicable
after such Force Majeure event..
2.9
Project Managers . PDL shall designate from time to
time at least one individual, and shall inform Facet of the
identity of such individual, to whom all of Facet’s
communications may be addressed with respect to the PDL Services
and who has authority to act for and bind PDL in all aspects with
respect to the PDL Services (the " PDL Project Manager
"). Facet shall designate from time to time at least one
individual and shall inform PDL of the identity of such individual,
to whom all of PDL’s communications may be addressed with
respect to the Facet Services and who has authority to act for and
bind Facet in all aspects with respect to the Facet Services (the "
Facet Project Manager "). The initial PDL Project
Manager designated by PDL shall be Cris Larson, Chief Financial
Officer, and the initial Facet Project Manager designated by Facet
shall be Herb Cross, Corporate Controller.
2.10
Cooperation . In the event that there is
nonperformance of any Service as a result of impracticability
pursuant to Section 2.8, the Parties agree to work together in
good faith to arrange for an alternative means by which the
applicable S
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