Amendment to Information Technology Services Agreement between Arch Chemicals, Inc. and Olin Corporation
Summary
Arch Chemicals, Inc. and Olin Corporation have amended their Information Technology Services Agreement originally dated February 8, 1999. The amendment sets out a transition plan for ending IT services provided by Arch to Olin, with a transitional period running until September 30, 2001, unless Olin opts for an earlier end date. The transition will occur in two phases, covering the transfer of various IT services and personnel. The amendment also details changes to pricing, billing, and the responsibilities of both parties during the transition period.
EX-10.1 3 0003.txt AMENDMENT TO INFORMATION TECHNOLOGY SERVICES EXHIBIT 10.1 AMENDMENT TO INFORMATION TECHNOLOGY SERVICES AGREEMENT THIS AMENDMENT ("AMENDMENT") TO INFORMATION TECHNOLOGY SERVICES AGREEMENT, dated as of February 15, 2000, by and between ARCH CHEMICALS, INC., a Virginia corporation ("ARCH"), and OLIN CORPORATION, a Virginia corporation ("OLIN"). WITNESSETH: WHEREAS, OLIN and ARCH entered into an Information Technology Services Agreement, dated as of February 8, 1999 (the "IT Services Agreement", capitalized terms not otherwise defined in this Amendment have the meaning set forth in the IT Services Agreement) in connection with the provision of certain information technology services by ARCH to OLIN; and WHEREAS, the IT Services Agreement provided for an Initial Term expiring on January 31, 2001, subject to automatic one-year renewals thereafter unless terminated by either party on twelve (12) months prior notice; and WHEREAS, the IT Services Agreement is not being renewed for a one-year term after the Initial Term and the provision by ARCH to OLIN of IT Services under the IT Services Agreement shall be terminated by an orderly transition of IT Services through implementation of two major transition phases (the "Transition"); and WHEREAS, OLIN and ARCH have agreed to amend the IT Services Agreement to reflect the agreements of the parties regarding the Transition and otherwise to reflect certain agreements reached by the parties. NOW, THEREFORE, in consideration of the mutual covenants and premises contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, OLIN and ARCH agree as follows: 1. Term of Agreement. The parties acknowledge and agree that upon ----------------- expiration of the Initial Term on January 31, 2001, the IT Services Agreement shall not be renewed but shall continue for a transitional period until September 30, 2001 (the "Extension Term"). OLIN may elect an earlier termination date for the Extension Term of June 30, July 31 or August 31, 2001 upon the giving of at least twelve (12) months prior notice to ARCH of such election by OLIN for such earlier termination date. 2. Transition Phases. The Transition shall be implemented in an ----------------- orderly manner through two major transition phases. (a) Phase I consists of two parts: (i) Part IA, the transition from ------- ARCH to OLIN of the LAN / Desktop / Server services, as well as Application Support services, and (ii) Part IB, the removal of those costs which OLIN or ARCH can pay directly from the allocation/billing process. Additional specifics of the Phase I transition are outlined on the attached Schedule I under Phase I. Implementation of Phase I has begun as of January 1, 2000 and ARCH and OLIN shall work cooperatively toward completion of such Phase I transition as promptly as reasonably possible, with the transition of LAN/Desktop/Server services to be completed by March 24, 2000 and the transition of Application Support and Part IB services to be completed by June 30, 2000. (b) Phase II -- Transition of the data center, telecom / data -------- (AT&T), help desk, PBX/voice services in Norwalk and Bethalto and all other remaining Services under the IT Services Agreement ("Phase II Services"). Additional specifics of the Phase II transition are outlined on the attached Schedule I under Phase II. Phase II shall occur during the Extension Term, except that OLIN may elect to accelerate transition from ARCH of certain Phase II Services prior to January 31, 2001. 3. Pricing. -------- (a) Pursuant to Part IB of the Phase I transition, all costs that either OLIN or ARCH can pay directly will be removed from the allocation / billing process effective January 1, 2000, or as soon as practical thereafter but no later than June 30, 2000. Such costs identified to date are listed on Schedule II, together with the effective date of their removal from the allocation/billing process. The parties shall continue to work together to identify other costs which are appropriate for direct payment and to effect such direct payment by June 30, 2000. (b) Upon the transfer of responsibilities for DSO services, all charges for salary and benefits for those services will immediately be removed from the allocation pool. All charges for salary and employee benefits for non-DSO employees transferred to OLIN pursuant to Section 5 below shall be removed by ARCH from the Pricing/Fees payable by OLIN, as of the effective date of such employees' addition to the OLIN payroll (c) All charges by ARCH for DSO services at Norwalk and East Alton (other than those set forth in subparagraph 3.(b), above) will end when the respective portion of Part IA of the Phase I transition is complete. (d) For the period from January 1, 2000 through December 31, 2000 the allocation of joint costs shall be as reflected on the budget attached hereto as Schedule IV. (e) As Phase II Services are transitioned out of the IT Services Agreement, ARCH will reduce charges to OLIN in the amount that removal of such Services result in a direct 2 reduction in ongoing costs. OLIN will continue to pay all remaining allocated costs through the Extension Term. (f) ARCH agrees to provide OLIN with data / voice services at its actual cost through January 31, 2001. 4. Services. --------- (a) ARCH will continue to provide Services through the Initial Term as set forth in Schedule A to the IT Services Agreement, except for those Services that are transitioned during Phase I, each of which Service shall no longer be performed by ARCH as of the effective date of transition of such Service to OLIN. (b) During Phase II of the transition, ARCH will continue to provide the Services comprised of (i) any Phase I Services for which transition has not been completed, (ii) the Phase II Services until the transition for such Service is complete, and (iii) the migration Services described in Section 20.2 of the IT Services Agreement. (c) For each Service that ARCH is providing, ARCH will continue to provide ancillary support services (e.g., report failures, call for service --- support, etc.) related to those Services for the period that ARCH is continuing to provide such Service. (d) ARCH will continue to provide Help Desk services with access to tools through September 30, 2001. ARCH will not engage in direct SMS problem solving for OLIN employees to enable a clean demark between Help Desk service and the LAN/Desktop Server services which will be provided by OLIN personnel for all OLIN employees. (e) OLIN will cease providing legacy system support to ARCH no later than September 1, 2000, unless otherwise agreed to in writing by the parties. 5. Personnel Transitions. ---------------------- (a) OLIN and ARCH acknowledge that the persons listed on Schedule III ("Schedule III Personnel") were transferred to the OLIN payroll on February 1, 2000. (b) ARCH and OLIN shall work together to complete the full transition and integration of Schedule III Personnel as promptly as possible, including the relocation of Schedule III Personnel to OLIN offices by March 24, 2000, and management of Schedule III Personnel by OLIN supervisors as soon as practical, except for those Schedule III Personnel designated on Schedule III as remaining on-site at ARCH locations with security access privileges, who will continue to be managed by ARCH so long as such person continues to have such security access. 3 6. OLIN Sourcing Study. OLIN will initiate a sourcing study ------------------- beginning in January 2000, with a completion goal no later than July 31, 2000. ARCH will provide OLIN information in a timely way (consistent with the terms of the IT Services Agreement) to permit OLIN to complete its sourcing study. On or before August 1, 2000, OLIN will advise ARCH of the final schedule for transition for all Services. Such sourcing study shall be conducted by and be the responsibility of OLIN. ARCH will not be requested to serve on an OLIN task team to develop RFP's and/or to choose sourcing alternatives; except that ARCH agrees to make available to OLIN up to 25% of Jim Hellrich's time through the end of the OLIN sourcing study to assist in defining service requirements and completing a suitable sourcing arrangement. 7. Financial Reporting and True-Ups. --------------------------------- (a) ARCH shall provide to OLIN financial reports as are consistent with reports generated for internal IT organizations. ARCH and OLIN shall agree as to the details of the contents and timing of such reports by March 31, 2000. (b) The budget for the second contract year is attached hereto as Schedule IV. ARCH will report on actual costs on quarterly basis. The true-up process for the period ending December 31, 2000 will occur on or before February 15, 2001. 8. Other Agreements. ----------------- (a) OLIN and ARCH will work cooperatively to effectively implement the proposed schedule for transition of Services described in Section 6 above. Any new Services not associated with the transition of Services from ARCH to OLIN will be managed in accordance with Section 3.5 of the IT Services Agreement. (b) As Services are removed from the IT Services Agreement during the Transition, OLIN shall thereafter be free to choose whatever technical standards and other specifications as OLIN elects with respect to such Services no longer covered by the IT Services Agreement. (c) OLIN will provide ARCH with satisfactory proof that OLIN is licensed to use software and systems that are managed by ARCH under the IT Services Agreement and that such license authorizes ARCH's access for purposes of management of the systems. 9. Final Termination of Agreement. As of the effective termination ------------------------------ date for the Extension Term pursuant to Section 2 above: (a) ARCH shall no longer provide and OLIN shall no longer receive any Services, except for those described in Article 20.2 of the IT Services Agreement, to the extent applicable; 4 (b) The Shared Assets shall be allocated and distributed between ARCH and OLIN as provided in Article 16 of the IT Services Agreement, pursuant to the agreed Schedule G attached hereto in substitution for the Schedule G originally attached to the IT Services Agreement; and (c) All other rights and obligations of the parties under the IT Services Agreement shall terminate, except for those which survive pursuant to the terms of the IT Services Agreement. 10. Effect of Amendment. Except as amended by this Amendment, the IT ------------------- Services Agreement shall remain unaffected and in full force and effect. This Amendment may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original and all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, the parties have executed this Amendment as of the date and year first above written. OLIN CORPORATION By: P. Kosche -------------------------------- Name: Peter C. Kosche Title: Senior Vice President, Corporate Affairs ARCH CHEMICALS, INC. By: Leon B. Anziano -------------------------------- Name: Leon B. Anziano Title: President 5 Schedule I PHASE I: Part IA - LAN / Desktop / Server (DSO) Services. A detailed plan will be - ------------------------------------------------ prepared by OLIN and reviewed by ARCH and implemented for both sites that covers the separation of systems and the transition of the responsibility for their support to OLIN as follows: (a) In Norwalk, the following will apply: ------- * OLIN will transition their users off ARCH's Exchange and Print / File servers. * OLIN will remove their specialty servers from ARCH's computer room. * OLIN will transition off ARCH's data base and intranet servers, and any other ARCH- owned Norwalk computer system. * OLIN will vacate ARCH's Xylan LAN switch. ARCH will assist OLIN connecting a new OLIN-provided LAN switch to ARCH's Cisco router. * The only shared systems and services that will remain will be the ARCH owned PBX and Voice mail systems, which will be managed by ARCH for the benefit of both companies. (b) In East Alton, the following will apply: ---------- * The shared Xylan LAN switch environment may remain until the East Alton campus is completely disconnected from the ARCH Bethalto computer center. This is anticipated to occur prior to September 30, 2001 when the campus is connected via a router to an external service supplier. * OLIN will relocate East Alton specific servers (currently estimated to total 4 servers) from the ARCH computer center. * personnel transferred from ARCH to OLIN will be moved from the ARCH computer center to OLIN supplied space. Part IA - Application Support Services -- - -------------------------------------- The following application development and support work will be transferred to OLIN no later than June 30, 2000: 1) Mainframe to/from SAP interface for Cash Application processing from lockboxes 2) Mainframe to/from SAP interface for A/P Payment processing to banking institutes 3) EDI: o Support converted transactions and maps (20+) 6 o Support new maps for invoicing, payments, procurement, orders, bills of lading o Set up new trading partners o Develop new EDI maps o Develop internal audit reporting o Support mailboxes o Develop Gentran server archival process 4) OLIN corporate and Chlor Alkali SQL server applications support: o IMPAC historical plant maintenance application o Legal application (backend to Corporate Law Pak) o Pension Partners o Possibly FSC and LIFO applications 5) OLIN corporate web based applications and sites: o Inside OLIN intranet site development and support o Legal intranet site support o Ethics intranet site support o Supply Order intranet site support 6) OLIN corporate ACCESS data base applications: o Direct Grants application development and support o Procurement card processing for Norwalk and Chlor Alkali o TPA development of data base and support ARCH will continue to assist in troubleshooting operational problems relating to SAP services until those services are transferred completely to OLIN. Part IB - - ------- * Charges which OLIN and/or ARCH can pay directly will be removed from the allocation/billing process. * Such removed charges and related vendor matters shall be handled directly by OLIN and/or ARCH outside of the allocation/billing system, including sourcing, contract negotiation, purchase requisitions, invoice approval, invoice processing, payment, and other matters related to direct vendors. * ARCH and OLIN may elect to collaborate on certain sourcing, however such collaboration will be at the parties' discretion and outside of the scope of the IT Services Agreement. * Current cost allocation methods will be reviewed and adjusted to assure equitable distribution of remaining costs. 7 PHASE II (a) Network (Voice / Data) Services. -------------------------------- * ARCH will remain the customer of record with AT&T and shall continue to provide OLIN with data/voice services at ARCH's actual cost for the Initial Term of the IT Services Agreement. * As of January 31, 2001, OLIN shall move to a new carrier of its choice and shall switch completely and pay transition costs associated with moving to the new carrier (including reasonable and actual fees for one time ARCH services involved with the transition, but not including increased charges that AT&T may impose on ARCH). * ARCH shall explore with OLIN possible arrangements with AT&T which could be of mutual benefit to both parties, but neither party shall be under any obligation regarding such possible arrangements, and any agreements regarding such arrangements would be outside the scope of the IT Services Agreement. (b) Help Desk. ---------- ARCH will continue Help Desk services with access to tools until expiration of the Extension Term. However, as of the transition of DSO personnel from ARCH to OLIN as a part of Phase I, ARCH will no longer engage in direct SMS problem solving for OLIN employees. This will provide clear demarcation between Help Desk service and the LAN / Desktop / Server services to be provided by such transferred OLIN personnel. (c) All other Services. To be transitioned in accordance with the ------------------ final schedule for transition provided by OLIN to ARCH by August 1, 2000 pursuant to Section 6 of this Amendment. 8 Schedule II Costs Removed From the Data Center Allocation / Billing Process Effective January 1, 2000
Schedule II Costs Removed From the Data Center Allocation / Billing Process Effective January 1, 2000
Schedule II Costs Removed From the Data Center Allocation / Billing Process Effective January 1, 2000
Schedule III: Arch IT Employees Transferring To Olin
Schedule IV Olin Information Technology Budget Summary
Schedule IV Summary of Shared Services
Note 1 Olin charge elimated when respective portion of Part IA of the Phase I transition is complete. Amount represents estimate of 12 months expenses. Charge to Olin will be adjusted to reflect allocation of actual expenses once Phase I transition is complete. Schedule IV Items/Services 100% Olin
100 percent Olin1 Schedule IV Items/Services 100% Arch
100 percent Arch1 Schedule IV Items/Services 100% Arch
100 percent Arch1 Schedule IV Information Technology - Chargeout Metrics Budget Year 2000
Schedule IV Information Technology - Chargeout Metrics Budget Year 2000
Schedule G Information Technology - Olin and Arch Asset Listing Data Center Physical Assets
Schedule G Information Technology - Olin and Arch Asset Listing Data Center Physical Assets
Schedule G Information Technology - Olin and Arch Asset Listing Data Center Physical Assets
Schedule G Information Technology - Olin and Arch Asset Listing Data Center Physical Assets
Schedule G Information Technology - Olin and Arch Asset Listing Data Center Physical Assets
Schedule G Information Technology - Olin and Arch Asset Listing Data Center Physical Assets
Schedule G Information Technology - Olin and Arch Asset Listing Data Center Physical Assets
Schedule G Information Technology - Olin and Arch Asset Listing Data Center Physical Assets
Schedule G Information Technology - Olin and Arch Asset Listing Data Center Physical Assets
Schedule G Information Technology - Olin and Arch Asset Listing Data Center Physical Assets
Schedule G Information Technology - Olin and Arch Asset Listing Data Center Physical Assets
Schedule G Information Technology - Olin and Arch Asset Listing Data Center Physical Assets