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Transition Services Agreement

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Sectors: Telecommunications
Governing Law: New York, View New York State Laws
Effective Date: July 25, 1997
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Exhibit 10.6


TRANSITION SERVICES AGREEMENT


TRANSITION SERVICES AGREEMENT, dated as of July 25, 1997 (this "Agreement"), between NextLevel Systems, Inc., a Delaware corporation ("Service Provider" or "NextLevel Systems") and General Semiconductor, Inc., a Delaware corporation ("Recipient" or "GS").


WHEREAS, General Instrument Corporation, a Delaware corporation ("GI"), is being separated and divided into three separate and independent public companies and, in order to effectuate the separation, (a) GI intends to distribute (the "Next Level Systems Distribution"), as a dividend to the holders of shares of common stock, par value $.01 per share, of GI, shares of common stock, par value $.01 per share, of NextLevel Systems (the "NextLevel Systems Common Stock") and (b) NextLevel Systems intends to distribute, following the NextLevel Systems Distribution, as a dividend to the holders of NextLevel Systems Common Stock, shares of common stock, par value $.01 per share of CommScope (the "CommScope Distribution"; and, together with the NextLevel Systems Distribution, the "Distributions");


WHEREAS, the Distributions will be effected pursuant to a Distribution Agreement, dated as of June 12, 1997 (the "Distribution Agreement"), among NextLevel Systems, CommScope and GI;


WHEREAS, the NextLevel Systems Distribution is becoming effective as of the date hereof (the "NextLevel Systems Distribution Date"); and


WHEREAS, in order to facilitate the orderly continuation of Recipient's business for a transitional period after the NextLevel Systems Distribution Date, Service Provider has agreed to provide to Recipient, and Recipient has agreed to purchase from Service Provider, the Transition Services described in this Agreement.


NOW, THEREFORE, in consideration of the premises and of the respective covenants and agreements set forth herein, the parties hereto hereby agree as follows:


ARTICLE I
DEFINITIONS


Section 1.01. Definitions. As used in this Agreement, the following terms shall have the following respective meanings (capitalized terms used but not defined herein shall have the respective meanings ascribed thereto in the Distribution Agreement):


"Agreement" shall have the meaning specified in the first paragraph hereof.


"CommScope" shall have the meaning specified in the recitals to this Agreement.


"CommScope Distribution" shall have the meaning set forth in the recitals.


"Distributions" shall have the meaning specified in the recitals to this Agreement.


"Distribution Agreement" shall have the meaning specified in the recitals to this Agreement.


"Distribution Date" shall have the meaning specified in the recitals to this Agreement.


"GI" shall have the meaning specified in the recitals to this Agreement.


"NextLevel Systems Common Stock" shall have the meaning set forth in the recitals.


"NextLevel Systems Distribution" shall have the meaning set forth in the recitals.


"NextLevel Systems Distribution Date" shall have the meaning specified in the recitals to this Agreement.


"Notice" shall have the meaning specified in Section 4.08 hereof.


"Other Services" shall have the meaning specified in Section 2.04.


"Recipient" shall have the meaning set forth in the first paragraph hereof.


"Service Provider" shall have the meaning set forth in the first paragraph hereof.


"Transition Period" shall mean, for each Transition Service, the transition period (commencing on the NextLevel Systems Distribution Date) set forth opposite such Transition Service on Schedule I hereto.


"Transition Services" shall mean the administrative services set forth on Schedule I hereto.


2


ARTICLE II
TRANSITION SERVICES


Section 2.01. Transition Period. Service Provider shall make available to Recipient each of the Transition Services for the applicable Transition Period on the terms and subject to the conditions set forth herein. The Transition Period for each Transition Service may be extended for such additional periods as may be mutually agreed by the parties hereto. The Service Provider shall only be obligated to provide Transition Services during normal business hours and in a manner that will not interfere with the Service Provider's business operations.


Section 2.02. Fees. Recipient shall pay to Service Provider the fees set forth on Schedule I hereto in respect of each of the Transition Services, plus reasonable out-of-pocket expenses incurred by the Service Provider in providing the Transition Services (including, but not limited to travel, overnight lodging, telephone, postage, reproduction costs, computer time, supplies and parts). Any payments required to be made hereunder shall be due and payable within 30 days of the date of invoice. Recipient shall pay any value-added tax and any tariff, duty, export or import fee, sales tax, use tax, service tax or other tax or charge subsequently imposed by any government or government agency on Recipient or Service Provider with respect to the Transition Services or the execution or performance of this Agreement.


Section 2.03. Performance of Transition Services. Service Provider agrees to perform the Transition Services to be provided hereunder in a professional and competent manner, using at least the same standard of care that it uses in performing such services in its own affairs. Recipient understands that the Transition Services provided hereunder are transitional in nature and are furnished by Service Provider solely for the purpose of facilitating the Distributions. Recipient understands that Service Provider is not in the business of providing Transition Services to third parties and has no long term interest in continuing this Agreement. Recipient agrees to make a transition to its own internal organization or other third party suppliers for the Transition Services as promptly as practicable.


Section 2.04. Other Services. From time to time, Recipient may find it desirable to request, in addition to the Transition Services, additional services to be made available to Recipient by Service Provider ("Other Services"). It is understood and agreed, however, that Service Provider is under no obligation to provide Other Services, nor has Service Provider made any promises, r
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