The Transition Services Agreement (TSA) is a crucial document used in corporate transactions where one entity must provide temporary support services to another following a separation event such as a divestiture, acquisition, or corporate restructuring. This agreement, structured under Canadian law, outlines the specific services to be provided, their duration, cost, and performance standards. It's particularly important in situations where the recipient entity needs time to establish its own independent operations or requires temporary access to the provider's resources, systems, or expertise. The TSA ensures business continuity during the transition period while addressing key aspects such as data protection, employee matters, and regulatory compliance across relevant Canadian jurisdictions. The document typically includes detailed schedules specifying service levels, pricing mechanisms, and governance structures to manage the temporary relationship effectively.
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1. Parties: Identification of the service provider and recipient entities
2. Background: Context of the agreement, including reference to the main transaction necessitating the TSA
3. Definitions: Key terms used throughout the agreement
4. Services: Overview of services to be provided and general service delivery principles
5. Service Standards: Quality levels, performance metrics, and service delivery requirements
6. Term and Termination: Duration of the agreement and circumstances for early termination
7. Fees and Payment: Cost structure, payment terms, and invoicing procedures
8. Governance and Management: Service management structure, escalation procedures, and reporting requirements
9. Personnel: Requirements regarding staff providing services and key personnel provisions
10. Confidentiality: Protection of confidential information exchanged during service provision
11. Data Protection: Obligations regarding personal data handling and privacy compliance
12. Intellectual Property: Ownership and usage rights of IP involved in service delivery
13. Liability and Indemnification: Allocation of risks and responsibilities between parties
14. Force Majeure: Provisions for handling events beyond parties' reasonable control
15. General Provisions: Standard boilerplate clauses including notices, amendments, and governing law
1. Migration Services: Details of transition support for migrating services to the recipient or third party - include when knowledge transfer is required
2. Third Party Providers: Provisions regarding subcontractors and third-party service providers - include when external vendors are involved
3. Security Requirements: Specific security protocols and requirements - include for services involving sensitive data or systems
4. Business Continuity: Disaster recovery and business continuity requirements - include for critical services
5. Regulatory Compliance: Specific regulatory obligations - include for regulated industries
6. Asset Usage: Terms for using provider's assets or facilities - include when physical assets are involved
7. Insurance: Specific insurance requirements - include for high-risk services
8. Exit Management: Detailed exit planning and transition out procedures - include for complex service arrangements
1. Schedule A - Services Description: Detailed description of each service to be provided
2. Schedule B - Service Levels: Specific performance metrics, KPIs, and measurement methods
3. Schedule C - Fees: Detailed fee structure, rates, and charging mechanisms
4. Schedule D - Governance Procedures: Detailed procedures for service management and oversight
5. Schedule E - Key Personnel: List of key personnel and their roles
6. Schedule F - Technical Requirements: Technical specifications and requirements for service delivery
7. Schedule G - Migration Plan: Detailed plan for service migration and knowledge transfer
8. Schedule H - Contact Details: Contact information for key stakeholders and escalation contacts
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