Looking for an agreement? Search from over 1 million agreements now.

Transition Services Agreement

This is an actual contract by Temple Inland.
Browse the agreement preview below and buy the entire agreement for $35
Search This Document
Exhibit 10.2 EXECUTION COPY MASTER TRANSITION SERVICES AGREEMENT
between
TEMPLE INLAND INC.
and
FORESTAR REAL ESTATE GROUP INC.
and
GUARANTY FINANCIAL GROUP INC. TABLE OF CONTENTS RECITATIONS 4 ARTICLE I SERVICES 5 Section 1.1 Initial Services 5 Section 1.2 Company Groups 5 Section 1.3 Omitted Services; Additional Services 5 Section 1.4 Performance of Services 5 Section 1.5 Changes to Services 6 Section 1.6 Use of Third Parties to Provide the Services 6 Section 1.7 Mutual Cooperation 6 Section 1.8 Internal Controls, Record Retention and Operating Policies 6 Section 1.9 Audit Assistance 6 ARTICLE II CHARGES AND BILLING; TAXES 6 Section 2.1 Charges for Transition Services 7 Section 2.2 Procedure 7 Section 3.3 Late Payments 7 Section 2.4 Taxes 7 Section 2.5 Record-Keeping 7 Section 2.6 No Set-Off 7 ARTICLE III TERM AND TERMINATION 7 Section 3.1 Term 7 Section 3.2 Early Termination 7 Section 3.3 Information Transmission 8 Section 3.4 Termination Assistance 8 ARTICLE IV CONFIDENTIALITY 8 Section 4.1 Protection of Information 8

Page 1 of 16


Section 4.2 Exclusion of Certain Information 8 Section 4.3 Non-Public Personal Information 8 Section 4.4 Security Program 9 Section 4.5 Notification of Security Breaches 9 Section 4.6 Operation of a Secure Site 9 ARTICLE V REPRESENTATIONS AND WARRANTIES; COVENANTS 9 Section 5.1 Authorization 9 Section 5.2 Non-Infringement 10 Section 5.3 Compliance with Laws 10 Section 5.4 Disclaimer of Representations and Warranties 10 ARTICLE VI LIMITATIONS OF LIABILITY AND INDEMNITY 10 Section 6.1 Exclusion of Certain Damages 10 Section 6.2 Provider's Indemnification for Third Party Claims 10 Section 6.3 Purchaser's Indemnification for Third Party Claims 10 Section 6.4 Clarification of Indemnification 10 ARTICLE VII DISPUTE RESOLUTION; GOVERNING LAW 10 Section 7.1 Amicable Resolution 10 Section 7.2 Arbitration 10 Section 7.3 Governing Law 11 Section 7.4 Submission to Jurisdiction 11 Section 7.5 Waiver of Jury Trial 11 ARTICLE VIII MISCELLANEOUS 11 Section 8.1 Survival 11 Section 8.2 Title to Intellectual Property 11 Section 8.3 Force Majeure 11 Section 8.4 Independent Contractors 12 Section 8.5 Subrogation 12 Section 8.6 Entire Agreement; Incorporation of Schedules and Exhibits 12 Section 8.7 Amendments and Waivers 12 Section 8.8 No Implied Waivers; Cumulative Remedies; Writing Required 12 Section 8.9 No Third Party Beneficiaries 12

Page 2 of 16


Section 8.10 Assignment; Binding Agreement 12 Section 8.11 Responsible Parties 12 Section 8.12 Notices 12 Section 8.13 Severability 13 Section 8.14 Construction 13 Section 8.15 Counterparts 13 Section 8.16 Delivery by Facsimile and Other Electronic Means 13 SIGNATURE PAGE 15 EXHIBIT A - SCHEDULES 16-89 EXHIBIT B - GLOSSARY 90 EXHIBIT C - DISPUTE RESOLUTION 92 EXHIBIT D - NOTICE OF EARLY TERMINATION 94

Page 3 of 16


MASTER TRANSITION SERVICES AGREEMENT Temple-Inland Inc. (" Temple-Inland" ), Forestar Real Estate Group Inc. (" Forestar" ) and Guaranty Financial Group Inc. (" Financial Services" ) make this Master Transition Services Agreement (" Agreement" ) in consideration of the mutual promises and agreements contained in this Agreement. RECITATIONS A. On the Effective Date, Temple-Inland will distribute to its shareholders pro rata all of the outstanding stock of Forestar (the " Forestar Distribution" ) and all of the outstanding stock of Financial Services (the " Financial Services Distribution" and, collectively with the Forestar Distribution, the " Distributions" ), both corporations that Temple-Inland currently owns and controls.B. Incident to the Distributions, each of the Companies have been required to plan to disaggregate various shared services and certain common uses of facilities and equipment. In order to facilitate separation of the Companies on the Effective Date, the Companies have agreed that certain shared services and certain common uses of facilities and equipment should continue for a transitional period after the Effective Date (together such shared services and common uses are referred to as the " Transition Services" ).C. The Provider of the Transition Services and each Purchaser of Transition Services shall agree in a separate Schedule to this Agreement (" Schedule" ) upon the scope, scale and description of each particular Transition Service to be provided, how long the Transition Service will be provided, early termination provisions, the price for the Transition Service expressed either as a fixed unit price or as a fixed periodic price, payment terms and such special terms and conditions as may be applicable to the particular Transition Service. Each of the Transition Services so scheduled shall be provided under the terms and conditions set forth in this Agreement as supplemented or expressly modified by the applicable Schedule. The form of the Schedules shall be substantially as set forth in Exhibit A .D. All the capitalized terms used in this Agreement shall have the meaning either given those terms or incorporated by reference in the Glossary attached as Exhibit B .

Page 4 of 16


ARTICLE I SERVICES Section 1.1 Initial Services . Commencing on the Effective Date, the Company designated as the Provider on each Schedule to this Agreement, shall provide to the Company or Companies designated as the Purchaser on the Schedule, the services set forth on that Schedule (" Initial Services" ) under the terms and upon the conditions set forth in this Agreement, including the applicable Schedule.Section 1.2 Company Groups . A Company may designate one of its Affiliates as the Provider on a Schedule. A Company may designate one of its Affiliates as the Purchaser on a Schedule. Any Company' s Affiliate that provides Transition Services and any Company' s Affiliate that purchases Transition Services shall be bound by the terms of this Agreement and the applicable Schedule under which the Transition Services are provided. Unless otherwise specifically provided in the applicable Schedule, the Affiliate designated either as a Provider or a Purchaser and the Company designating them shall be jointly and severally liable for all obligations under this Agreement with respect to the Transition Service provided under the applicable Schedule. As requested by the other parties to a Schedule, the applicable Company shall cause each of its Affiliates designated as a Purchaser or a Provider in that Schedule to execute the Schedule to evidence that the member is legally obligated by that Schedule and terms of this Agreement, but a signature by a member so designated is not required to bind that member.Section 1.3 Omitted Services; Additional Services . If during the Term of this Agreement any of the Companies identifies a service that reasonably should have been included in the Transition Services, but was inadvertently omitted (" Omitted Services" ), then that Company may request the Company that would have been the Provider of such Omitted Services to furnish the Transition Services. The Company requested to provide the Omitted Services shall do so if commercially feasible to provide the Transition Services under the terms of this Agreement for a fixed unit fee or fixed periodic fee set by the potential Provider in an amount reasonably estimated to cover the cost of providing the Transition Services and other commercially reasonable terms covered in a Schedule. If the Company requesting the Omitted Services accepts the terms for provision of the Omitted Services offered by the potential Provider, those Companies shall enter into a Schedule that will become part of this Agreement. Companies may also add additional services (" Additional Services" ) that are not Omitted Services by entering into a Schedule that is made part of this Agreement provided that Additional Services entered under this Agreement must terminate no later than the end of the term of this Agreement.Section 1.4 Performance of Services . Provider shall perform its duties and discharge its obligations under this Agreement in a commercially reasonable manner based upon its current practices in providing analogous services for itself or its Affiliates (or prior practices in the absence of a current practice) and in accordance with any service levels and performance obligations specified in the applicable Schedule. This obligation is subject to and upon the following conditions:(a) No Provider shall be required to perform any Transition Service in a manner that would constitute a violation of applicable law.(b) No Provider shall be required to perform any Transition Service for the benefit of any Third Party.(c) Except as set forth otherwise in an applicable Schedule, no Provider shall be obligated to (i) hire or train additional employees, (ii) purchase, lease or license any additional equipment or software or (iii) pay any cost related to the transfer or conversion of Information to Purchaser upon termination of the Transition Services.(d) Except as set forth otherwise in an applicable Schedule, Provider shall be solely responsible for maintaining during the applicable Service Period equipment, software, licenses, personnel, facilities and other resources reasonably necessary for Provider' s provision of the Transition Services for which it is responsible that are substantially equivalent to those resources that were available to the Provider at the Effective Date.Section 1.5 Changes to Services. Except as provided in Section 1.9 below, Provider may make changes from time to time in the manner of performing the Transition Services, if:

Page 5 of 16


(a) Provider is making similar changes in performing analogous services for itself or its Affiliates;(b) Provider furnishes to Purchaser substantially the same notice (in content and timing) and right of consultation as Provider shall furnish to its Affiliates respecting such changes, provided that if there is no such notice or right of consultation, then Provider shall give a commercially reasonable notice and right of consultation to Purchaser;(c) changes shall not result in any material degradation of the Transition Services and after the applicable changes, the Transition Services shall meet the standards imposed by this Agreement.Section 1.6 Use of Third Parties to Provide the Services . Provider may discharge its duties and perform its obligations under this Agreement through agents, subcontractors or independent contractors.Section 1.7 Mutual Cooperation . Purchaser and Provider shall cooperate with each other in connection with the performance of the Transition Services, including producing on a timely basis all Information that is reasonably requested with respect to the performance of the Transition Services.Section 1.8 Internal Controls, Record Retention and Operating Policies . Provider shall maintain and comply with the internal controls, record retention policies and other operating policies and procedures that were in place prior to the Effective Date with respect to each Transition Service or as otherwise implemented by the Parties to comply with internal standards and procedures or applicable law. If a Purchaser under a Schedule requires a change to the internal controls or compliance policies or requires the implementation of additional internal controls or compliance policies related to a Transition Service in order to comply with changes to applicable law or internal standards and procedures, the Provider shall change or add to the internal controls or compliance policies related to the Transition Service as requested by the Purchaser. In connection with a Provider changing or adding to internal controls or compliance policies as required by the foregoing, the Purchaser shall pay for any additional costs for the Transition Service associated with the implementation or maintenance of the applicable change or addition; provided, however, that if (i) such change or addition is required for the compliance of both the Purchaser and the Provider with a law or policy applicable to both, or (ii) both the Purchaser and the Provider will benefit from such change or addition, the Parties shall negotiate in good faith an equitable sharing of the costs associated with such change or addition.Section 1.9 Audit Assistance . Provider and Purchaser shall cooperate with the other in providing such Information as may be required and access for audits by independent certified public accountants, internal auditors, regulators, or other persons with the right of audit. A Party acting as a Purchaser hereunder may request its third party auditor to perform a SAS 70 Type II audit or other audit or review of such Provider' s internal controls and operating environment related to the Transition Services upon reasonable advance notice, and the Provider shall perform such an audit or review or assist Purchaser or Purchaser' s third party auditor in connection with such an audit or review, in each case at the Purchaser' s expense. At the conclusion of such audit or review, the Provider shall implement such reasonable changes to the Transition Services or operating environment to correct deficiencies identified in the audit report to ensure compliance with applicable law or that are otherwise necessary for Provider to comply with Purchaser' s internal policies in connection with the Transition Services. The Parties shall share the costs to implement all such changes equally. The Company being audited shall be responsible for all incremental costs incurred by other Companies in providing such Information or assistance. ARTICLE II CHARGES AND BILLING; TAXES Section 2.1 Charges for Transition Services . The charges for the Transition Services shall be established in monthly units and shall be (a) as set forth in the applicable Schedules, or (b) determined in accordance with the charging methodology as set forth in the applicable Schedules (the " Charges" ). Provider shall invoice Purchaser for the Charges in the manner and at the time provided in the applicable Schedule. Charges shall be good faith advance estimates of Provider' s cost of providing the Transition Services and shall not be corrected retroactively for actual costs. Provider may change the Charges for future billing at any time to cover a change in the cost of providing the Transition Service. Provider will give Purchaser thirty (30) days notice of any such change in Charges. Annually within 30 days after the anniversary date of this Agreement, Provider and Purchaser shall review the Charges and make any adjustments to those Charges going forward to reflect changes in the cost of providing the Transition

Page 6 of 16


Services during the preceding year. Changes for any time period covered as an extension of service beyond the originally scheduled end date shall be at market value instead of cost. The market value pricing will be determined by the Provider and will be equal and equitable in light of market conditions for services of a like kind and duration. There will not be any charges for the time period between the Effective Date and January 1, 2008. The Parties intend that the Charges will be fair, reasonable and arms length pricing and in compliance with the affiliate transaction requirements promulgated from time to time by the regulatory entities having authority over financial services, including Office of Thrift Supervision (OTS) Regulations 12 C.F.R. 563.41 and 563.42 and Sections 23A and 23B of the Federal Reserve Act.Section 2.2 Procedure . Purchaser shall pay to Provider the Charges as invoiced by Provider, in the manner and at the time provided in the applicable Schedule. All amounts due and payable under this Agreement shall be invoiced and paid in U.S. dollars.Section 2.3 Late Payments . Charges not paid when due in accordance with the provisions of the applicable Schedule shall bear interest at a rate per annum equal to the lesser of Prime Rate plus two percent (2%) from such date due until the date paid, or the maximum contractual rate permitted by law.Section 2.4 Taxes . Purchaser shall pay any and all Transfer Taxes incurred in connection with the applicable Provider' s provision o
-- End of Preview --
Home| About Us| FAQ| Subscription | Contact Us |