Fill and Sign the American Real Estate Partners Lp Form

SERVICES AGREEMENT THIS SERVICES AGREEMENT ("Agreement") is made as of December 22, 1999 by and between WPI Group, Inc. ("WPI") and Warner Power, LLC and Warner Power Conversion, LLC (collectively "Warner"). BACKGROUND As of the date hereof, Warner is acquiring substantially all of the assets of WPI Power Systems, Inc. and WPI Electronics, Inc. and certain assets of WPI. Until such time as Warner can provide the services set forth in this Agreement for itself, Warner will receive such services from WPI. In addition, as set forth in this Agreement Warner will require the services of certain WPI employees and WPI will require the services of certain Warner employees after the date hereof. TERMS In consideration of the terms and conditions of this Agreement and intending to be legally bound, WPI and Warner agree asfollows: 1. Provision of Services. Upon the terms and subject to the conditions set forth in this Agreement, with respect to each of those services set forth in an Appendix hereto, each of which Appendices is made a part of this Agreement, WPI will provide to Warner the services indicated in such Appendix (hereinafter referred to as the "Services"). 2. Service Charges and Other Terms. The prices and pricing methodology and other terms of the Services shall be those set forth in the Appendices hereto. 3. Cooperation. Each party shall observe the normal security and other operational procedures in place at the other party's offices. 4. Provision of Corporate Records. In connection with the Services, subject to applicable law and privileges, upon the prior and reasonable request by a party for specific and identified agreements, documents, books, records or files, relating to or affecting such party, the other party shall arrange, as soon as reasonably practicable following the receipt of such request, for the provision of appropriate copies of such records (or the originals thereof if the party making the request has a compelling need for such originals) in the possession of such other party, but only to the extent such items are not already in the possession of the requesting party. 5. Access to Information. In connection with the Services, subject to applicable law and privileges, each of WPI and Warner shall afford to the other and its authorized accountants, counsel and other designated representatives reasonable access, upon reasonable prior notice during normal business hours, subject to appropriate restrictions for classified, privileged or confidential information, to the personnel, properties, books and records of such party insofar as such access is reasonably required by the other party. 6. Reimbursement; Other Matters. A party providing records or access to information to the other shall be entitled to receive from the recipient, upon the presentation of invoices therefor, payments for such amounts, relating to supplies, disbursements and other out-of-pocket expenses, as may be reasonably incurred in providing such records or access to information. 7. Indemnification. Each of the Parties hereto (each an "Indemnifying Party") shall indemnify, defend, save and hold harmless the other party hereto, its direct and indirect subsidiaries, and each party's and its subsidiaries' officers, directors, employees and agents (collectively, the "Indemnified Parties") from and against any and all damages incurred or sustained by the Indemnified Parties to the extent they arise out of any (i) breach by the Indemnifying Party of any of its covenants, agreements or obligations contained in this Agreement or (ii) the Indemnifying Party's gross negligence, willful misconduct or reckless disregard of its duties hereunder. For purposes of this section, "damages" shall mean all actions, costs, damages, disbursements, obligations, penalties, liabilities, taxes, losses, charges, expenses, assessments, judgments, settlements or deficiencies of any nature whatsoever, whether foreseeable or unforeseeable (including, without limitation, any interest, penalties, reasonable investigation, legal, accounting and other costs and expenses incurred in the investigation, collection, prosecution and defense of any action, suit, proceeding or claim and amounts paid in settlement) that may be imposed or otherwise incurred or suffered by an Indemnified Party; provided, however, that damages shall exclude, and WPI shall not have liability to, the Indemnified Parties under this Agreement for consequential, special, exemplary or punitive damages. 8. Confidentiality. Each party and its affiliates shall not use or permit the use of (without the prior written consent of the party to which any confidential information relates) and shall keep, and shall cause its consultants and advisors and third party service providers to keep, confidential all information concerning the other party received pursuant to or in connection with this Agreement. 9. Disaster Backup. WPI shall provide, where applicable, backup or disaster recovery capability for the Services provided hereunder, or for any data, files or the documents or material furnished by Warner to WPI hereunder. 10. Year 2000 Readiness. To the best of WPI's knowledge and belief, the reasonably foreseeable consequences of the Year 2000 problem will not adversely effect WPI's ability to perform its duties and obligations under this Agreement. 11. Term; Termination. Unless otherwise agreed in writing by the parties, the term of this Agreement shall commence on the date first set forth above and continue with respect to each Service set forth on an Appendix hereto until such time as Warner determines that it no longer needs to obtain such Services from WPI, provided, that in no event will Warner continue to receive any Services from WPI after May 31, 2000, unless WPI expressly agrees to continue to provide such Services upon Warner's written request. 12. Upon Termination. Upon termination of this Agreement with respect to any Services and subject to applicable law (including, but not limited to, recordkeeping requirements of Warner and its subsidiaries), each party, at the request of the other party, shall promptly either return to the other party all applicable confidential information of the other party then in its possession or certify in writing that all such confidential information has been destroyed. As to all other records, files, documents or other material belonging to one party which are in the possession of the other party at termination, the party holding such material shall return it to the other party at its request; provided the party requesting such return shall reimburse the returning party the reasonable out-of-pocket expenses, if any, incurred in implementing such return. In the alternative, the parties may agree upon the disposition of such material. Notwithstanding the foregoing, copies of confidential information and other materials may be retained for legal, accounting and other legitimate business purposes. 13. Notices. Any notices permitted or required by this Agreement shall, unless otherwise agreed, be in writing and shall be deemed effective when received. Effective notices may be given and delivered by mail, by courier service or by facsimile transmission. Notices shall be addressed as follows: if to Warner: Warner Power, LLC 40 Depot Street Warner, NH 03278 Attention: Dennis M. Deegan Telephone: (603) 456-3111 Facsimile: (603) 456-2098 if to WPI: WPI Group, Inc. 1155 Elm Street Manchester, NH 03101 Attn: Michael B. Tule, Esquire Telephone: 603-627-3500 Facsimile: 603-627-3150 or to such other address as either party may by notice hereunder advise the other as its new address for receipt of notices. 14. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument. 15. No Waiver. No term or provision hereof shall be deemed waived and no breach excused, unless such waiver or consent shall be in writing and signed by the party claimed to have waived or consented. Any consent by either party to, or waiver of, a breach by the other, whether express or implied, shall not constitute a consent to, waiver of, or excuse of any other different or subsequent breach. 16. Captions. The captions in this Agreement are provided for convenience of reference only and in no way define or delimit any of the provisions hereof or otherwise affect their construction or effect. 17. Governing Law. This Agreement shall be deemed to be a contract made in New Hampshire and governed by New Hampshire law, without regard to principles of conflicts of laws. 18. Partial Invalidity. If any provision of this Agreement shall be held or made invalid by a court decision, statute, rule or otherwise, the remainder of this Agreement shall not be affected thereby; provided, however, that if such provision constitutes the essence of this Agreement then this Agreement shall be deemed terminated without such termination constituting a breach hereof. 19. Parties in Interest. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their successors and assigns. This Agreement is not for the benefit of any other person or entity, and there shall be no third party beneficiaries hereof. Nothing contained in this Agreement shall modify the rights or obligations of the parties under any other agreement to which they are parties. IN WITNESS WHEREOF, the parties have executed this Agreement by their duly authorized officers with the intent of being legally bound hereby. Warner Power, LLC By:/s/Dennis Deegan ----------------------- Name:Dennis Deegan Title: Warner Power Conversion, LLC By: Warner Power, LLC Its Sole Member By:/s/Dennis Deegan ----------------------- Name:Dennis Deegan Title: WPI Group, Inc. By:/s/Michael Tule --------------------- Name:Michael Tule Title:Vice President and General Counsel APPENDIX TO SERVICES AGREEMENT Computer Services Type of Service Until such time as Warner removes the Hewlett-Packard 917 main frame computer from the Manchester, New Hampshire offices of WPI, WPI agrees to provide Warner computer services from the WPI-owned Hewlett Packard 967 main frame computer to maintain Warner's general ledger, and related accounting and operational databases. Warner agrees that it shall use its best efforts and shall employ such resources as are necessary to effect a transition to its own computer system within sixty (60) days from the date hereof. Warner agrees to make Alan Grill available on a mutually agreeable basis to assist WPI with computer resource projects, including programming for WPI's Growth Power software application and related databases. WPI agrees to make Gregory Reinert available on a mutually agreeable basis to assist Warner with computer resource projects, including network administration and installation of the Warner Hewlett Packard 917 (947) main frame computer. Warner also agrees to make Rod Perron available on a mutually agreeable basis to assist WPI with corporate accounting and tax matters. Service Coordinator John Powers shall be the service coordinator for WPI. Dennis Deegan shall be the service coordinator for Warner.Cost WPI and Warner shall each bear the expenses of their respective employees for the term of this Agreement. In the event that the Warner Hewlett Packard 917 has not been removed from the WPI offices in Manchester, New Hampshire within 60 days from the date of this Agreement, Warner agrees to pay to WPI a fee of $5,000 per month in arrears for each month or pro-rated part thereof, but in no circumstance shall WPI provide these services past May 31, 2000. Service Expectation or Objective Standard of Performance Warner and WPI shall provide service to each other on substantially the same basis provided for each of their own use. Warner and WPI agree to provide access to their respective facilities upon mutually agreeable and reasonable prior notice.