Intercompany Services Agreement Dated July 23, 1996

EXHIBIT 10.2

EXECUTION COPY ================================================================================


INTERCOMPANY SERVICES AGREEMENT


Dated as of July 23, 1996


by and between


CALCOMP TECHNOLOGY, INC.,
a Delaware corporation


and


LOCKHEED MARTIN CORPORATION,
a Maryland corporation


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INTERCOMPANY SERVICES AGREEMENT
-------------------------------


This INTERCOMPANY SERVICES AGREEMENT (this "Agreement") is made and entered into as of the 23rd day of July, 1996, by and between CALCOMP TECHNOLOGY, INC., a Delaware corporation (collectively with its subsidiaries, "CalComp Technology"), and LOCKHEED MARTIN CORPORATION, a Maryland corporation ("Lockheed Martin").


WHEREAS, pursuant to Section 5.2(a) and 6.2 of the Plan of Reorganization and Agreement for the Exchange of Stock of CalComp Inc. for Stock of Summagraphics Corporation dated as of the 19th day of March, 1996, as amended (the "Reorganization Agreement"), by and among Summagraphics Corporation ("Summagraphics"), Lockheed Martin and CalComp Inc., a California corporation ("CalComp"), Summagraphics and Lockheed Martin agreed to execute and deliver this Agreement at the closing (the "Closing") of the transactions contemplated by the Reorganization Agreement;


WHEREAS, pursuant to the Reorganization Agreement, Summagraphics agreed to issue and deliver to Lockheed Martin shares representing 89.7% of Summagraphics' outstanding Common Stock, par value $.01 per share (the "Common Stock"), on a fully diluted basis, in exchange for the transfer and delivery of all the issued and outstanding capital stock of CalComp to Summagraphics, all pursuant to and in accordance with the terms of the Reorganization Agreement;


WHEREAS, prior to the consummation of the transactions contemplated by the Reorganization Agreement, Lockheed Martin had provided certain services to CalComp, which services CalComp Technology desires Lockheed Martin to continue providing to CalComp Technology after the Closing; and


WHEREAS, simultaneously with the execution and delivery of this Agreement, the Closing has occurred.


NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Summagraphics and Lockheed Martin agree as follows:


1. CORPORATE SERVICES AND EMPLOYEE BENEFITS.
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(a) Beginning on the date hereof (the "Effective Date"), Lockheed Martin shall provide to CalComp Technology all of the services set forth in Exhibit A to this Agreement to the extent provided prior to Closing by Lockheed Martin to CalComp ("Corporate Services"). To the extent provided in this Agreement, Lockheed Martin will include CalComp Technology in its insurance coverage, including self-insurance, if applicable, ("Insurance"). In addition, Lockheed Martin has agreed to provide those employees who were employees of CalComp immediately prior to the Closing with


benefit plans and programs and the corresponding administrative services which were provided to employees of CalComp prior to Closing ("Benefit Plans"). The Corporate Services and Benefit Plans may be provided in accordance with the terms and conditions of this Agreement by (i) any affiliate or employee of Lockheed Martin or its affiliates or (ii) any third party, at the sole discretion of Lockheed Martin.


(b) From time to time, Lockheed Martin reviews its policies with respect to the provision and cost of services and the methodologies of allocating such costs among Lockheed Martin's subsidiaries in respect of those services that Lockheed Martin provides to its subsidiaries in the normal course. In the event that Lockheed Martin determines that a reduction in the level of such services (including the Corporate Services) or in the costs allocated to subsidiaries in respect of such services generally, CalComp Technology would be entitled to participate in the benefit associated with any such reductions.


2. CORPORATE SERVICES.
------------------


(a) Fee. In exchange for the Corporate Services, CalComp Technology
--- shall pay to Lockheed Martin a fee (the "Services Fee") that will be determined by Lockheed Martin on a basis consistent with past practices, recognizing, to the extent practicable, (i) Lockheed Martin's percentage ownership of CalComp Technology, (ii) CalComp Technology's requirements for certain services for which CalComp or Summagraphics was previously charged by Lockheed Martin and other third parties, (iii) costs of obtaining services from third parties that previously were provided to CalComp by Lockheed Martin. CalComp Technology shall pay the Services Fee (which shall include an allocation of Lockheed Martin's overhead costs) to Lockheed Martin periodically in arrears on the last business day of the period to which the Services Fee relates.


(b) Additional Corporate Services. At any time during the term of
----------------------------- this Agreement, CalComp Technology may request that Lockheed Martin provide additional services to CalComp Technology. Upon any such request, the parties will discuss in good faith, without obligation, an appropriate adjustment to the Services Fee to reflect such additional services, after which CalComp Technology shall notify Lockheed Martin in writing whether it shall accept such additional services and such adjustment.


(c) Term; Termination of Corporate Services. The term of Lockheed
--------------------------------------- Martin's agreement to provide Corporate Services shall be for two (2) years from and after the Effective Date, provided that (i) Lockheed Martin, at its option, may terminate this Agreement upon not less than 90 days prior written notice (or such other time as is reasonably agreed by the parties) to CalComp Technology at any time that Lockheed Martin no longer owns Common Stock representing more than 50% of all of the issued and outstanding Common Stock of CalComp Technology and CalComp


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Technology may terminate this Agreement by providing not less than 90 days written notice to Lockheed Martin at any time that Lockheed Martin owns Common Stock of CalComp Technology representing less than 25% of its issued and outstanding Common Stock.


3. (a) Insurance. Lockheed Martin shall use its reasonable efforts
--------- to cause CalComp Technology to be covered under Lockheed Martin's insurance policies (including, without limitation, property, casualty, workers' compensation and directors and officers liability policies) which will provide to CalComp Technology the type of Insurance provided to Summagraphics, or, at Lockheed Martin's option, CalComp immediately prior to Closing, subject to availability. Lockheed Martin shall not be responsible for obtaining or maintaining any insurance coverage for CalComp Technology other than as set forth in the preceding sentence. CalComp Technology shall, within 30 days of its receipt of a reasonably detailed invoice from Lockheed Martin, pay the portion of the premiums and other charges for the Insurance attributable to the coverage provided to CalComp Technology. The portion of such premiums and other charges payable by CalComp Technology shall be allocated in good faith by Lockheed Martin in a manner to reflect the cost to Lockheed Martin of the insurance premiums and other charges that are properly attributable to CalComp Technology (including an allocation of Lockheed Martin's overhead costs related to providing such insurance). The Insurance provided shall be subject to such policies of insurance or self-insurance, and such guidelines or procedures in respect of insurance or self-insurance, as Lockheed Martin shall determine in its sole and absolute discretion, provided that in the event the terms of the Insurance change from those terms in effect immediately prior to the date hereof, Lockheed Martin agrees (a) to the extent Lockheed Martin is aware of a material change prior to the effective date of the change, to provide notice to CalComp Technology of the change prior to its effective date, or (b) otherwise to provide notice to CalComp Technology upon becoming aware of the change. It is expressly agreed by CalComp Technology and Lockheed Martin that any self- insurance, retention or deductible shall be for the account of and be an obligation of CalComp Technology, and that CalComp Technology's obligations in respect of such self-insurance, retention or deductible shall survive the termination of this Agreement.


(b) Termination of Insurance. Either CalComp Technology or Lockheed
------------------------ Martin may terminate all or any portion of the Insurance at any time on 90 days' prior written notice to the other party hereto, subject to the terms of the insurance coverage. Notwithstanding the foregoing, so long as Lockheed Martin beneficially owns shares of Common Stock possessing 50% or more of the voting power of all then-outstanding shares of capital stock, CalComp Technology may not, without the prior written consent of Lockheed Martin, terminate all or any portion of the Insurance without providing evidence satisfactory to Lockheed Martin that CalComp Technology has obtained, or upon termination of such Insurance will obtain, comparable insurance coverage. In the event


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all or any portion of the Insurance is terminated, if appropriate, the charges therefor shall be adjusted equitably to reflect such termination.


4. EMPLOYEE BENEFIT PLANS.
----------------------


(a) Plans and Services. Prior to the Effective Date, employees of
------------------ CalComp participated in the employee benefit plans sponsored by Lockheed Martin listed on Exhibit B. On and after the Effective Date, employees who were employees of CalComp immediately prior to the Closing shall continue ...