Exhibit 10.1
SERVICES AGREEMENT
THIS AGREEMENT is entered into effective on the 19th day of February, 2001 by
and between AMBIENT CORPORATION ("Client") and XXXXXXX CORPORATION ("Bechtel").
1.0 SCOPE OF AGREEMENT
1.1 Services. Bechtel agrees to provide Client from time to time, in accordance
with this Agreement, such of the following services as Client may request and as
Bechtel may be able to provide: engineering, procurement, project management,
program management, construction management, project cost and schedule planning,
project development support, financing assistance, or other professional or
technical services ("Services").
1.2 Ordering Procedure. Services may be requested by Client by letter or in the
form of Client's purchase order or similar preprinted document. If and when
expressly agreed to by Bechtel in writing, in the form of the sample Work Order
attached hereto as Attachment A, a request for Services shall become effective
as a Work Order under this Agreement.
1.3 Terms and Conditions. The terms and conditions of this Agreement shall
govern each Work Order except to the extent expressly supplemented or modified
in the Work Order by mutual agreement to suit the particular circumstances of
the Work Order. Preprinted terms and conditions contained on any purchase order
or similar document issued to Bechtel by Client are superseded by the terms and
conditions of this Agreement.
1.4 Changes. Changes to any Work Order shall be processed like an original Work
Order and shall be similarly subject to mutual agreement.
1.5 Authorized Representatives. Each party shall advise the other of the
representative(s) authorized by such party to issue or agree to Work Orders
under this Agreement.
2.0 PERFORMANCE OF SERVICES
2.1 Independent Contractor. Bechtel shall perform Services as an independent
contractor in accordance with the applicable Work Order and Xxxxxxx'x own
methods and procedures.
2.2 Agency Function. Where Services such as procurement or construction
management require Bechtel to deal with contractors, suppliers, shippers, or
other third parties, Bechtel shall carry out such Services as Client's agent.
2.2.1 Client hereby authorizes Bechtel to represent to all such third
parties that Bechtel is acting in Client's name with respect to such
procurement or construction management. Upon Xxxxxxx'x request, Client
shall confirm to such third parties Xxxxxxx'x authorization to so act for
and on behalf of Client.
Page 1
2.2.2 Client acknowledges that the work required to complete the Project
shall require the involvement and assistance of other third party
professionals and service companies ("Third Party Contractors") which may
include but not be limited to architects, engineers, site acquisition
consultants, regulatory consultants, environmental consultants,
geotechnical firms, surveyors, and construction contractors. Bechtel shall
make reasonable efforts to locate and interview Third Party Contractors as
agent for Client. Privity of contract shall exist only between Client and
the Third Party Contractors with respect to the services to be performed
by the Third Party Contractors pursuant to express written agreements that
are executed by Client and such Third Party Contractors. Bechtel shall
coordinate and manage the services of the Third Party Contractors as agent
for Client, subject to any limitations on Xxxxxxx'x authority mutually
agreed by the parties. Client shall be solely responsible for the payment
of invoices submitted by the Third Party Contractors; provided that
Bechtel shall provide the accounting and controller management services
set forth in the applicable Work Order. Client shall indemnify and defend
Bechtel from any and all claims, losses, costs or expenses arising from
the services provided by the Third Party Contractors, provided that Client
shall not indemnify Bechtel to the extent that such claims, losses, costs
or expenses arise in whole or in part from the failure of Bechtel to
coordinate, monitor and manage the services of the Third Party Contractors
or otherwise perform the Services as required by this Agreement.
2.2.3 In conjunction with performing Services as described in this Section
2.2, Bechtel shall be responsible for inspecting the work of Third Party
Contractors and/or their subcontractors on the construction sites from
time to time or as directed by Client to monitor compliance by such Third
Party Contractors with their contractual responsibilities to Client. With
regard to work quality and safety, Xxxxxxx'x obligations are to report any
deficiencies or instances of noncompliance by such Third Party Contractors
to Client and to make recommendations on how to remedy such deficiencies
or such noncompliance, recognizing that Bechtel is providing project
management services and that Client will look to the Third Party
Contractors to remedy any deficiencies in their work quality and for
implementation of the safety programs.
2.3 Client Information. Bechtel shall perform the Services based upon
information furnished by Client, and Bechtel shall be entitled to rely upon such
information.
2.4 Completion. Bechtel shall exercise its best efforts to perform the Services
on a timely basis. Upon completion of the Services under a particular Work
Order, Bechtel shall have the right to notify Client in writing of the date of
said completion and request confirmation of same by Client. Upon receipt of such
notice, Client shall promptly confirm to Bechtel in writing that the Services
referred to in said notice were completed on the date indicated in said notice
or provide Bechtel with a written listing of the Services not completed. Any
Services included in Xxxxxxx'x notice to Client and not listed by Client as
incomplete in a listing delivered to Bechtel within thirty days of Client's
receipt of such notice shall be deemed complete and accepted. With respect to
Services listed by Client as incomplete, Bechtel shall complete such Services,
or
Page 2
explain why such Services should be deemed completed, and the above acceptance
procedure shall be repeated.
2.5 Standard of Performance. Bechtel shall perform the Services with that degree
of skill and judgment normally exercised by recognized professional firms
performing services of a similar nature. Bechtel shall reperform at its own
expense any of its Services that fail to meet such standard; provided that
Xxxxxxx'x liability shall be limited to the reperformance of those deficient
Services of which Client has notified Bechtel not later than thirty (30) days
after discovery thereof and in no event later than one (1) year following
completion of such Services; and provided further that such corrective
reperformance shall be Xxxxxxx'x sole liability and Client's exclusive remedy
for deficient Services. Bechtel shall not be liable with respect to any goods or
services furnished by third parties. BECHTEL DISCLAIMS AND CLIENT WAIVES ANY
STANDARDS OF PERFORMANCE OR WARRANTIES, INCLUDING IMPLIED OR STATUTORY
WARRANTIES OTHER THEN THOSE EXPRESSED IN THIS AGREEMENT.
3.0 COMPENSATION AND PAYMENT
3.1 Recoverable Costs. As compensation for the performance of the Services,
Client shall pay Xxxxxxx'x "Recoverable Costs", (consisting of the sum of
Personnel Costs, as defined in Section 3.2 below, and Other Direct Costs, as
defined in Section 3.3 below), plus a "Fee" of four percent (4 %) applied to all
Personnel Costs.
3.2 Personnel Costs. "Personnel Costs" shall be determined by standard hourly,
daily, or weekly rates by project position, as identified in Attachment B to
this Agreement. These rates shall be deemed to cover, with respect to employees
working on a Client project, the cost of employee holidays and paid time off;
social, insurance, retirement, and other fringe benefits; payroll taxes;
premiums for unemployment, workers' compensation, and employer liability
insurance; general and administrative expenses; costs of maintaining established
offices and other corporate resources.
3.3 Other Direct Costs. "Other Direct Costs" incurred by Bechtel in connection
with the Services, determined in accordance with Xxxxxxx'x established policies
and practices, shall consist of: (1) actual and reasonable transportation,
subsistence, and other travel related expenses; (2) costs associated with
consultants and other outside services and facilities; (3) cost for
communications expenses, including telephone and courier services; (4) costs for
computers and data processing directly related to the performance of the
services; (5) taxes, except payroll taxes (which are included in Section 3.2
above) and taxes levied on Xxxxxxx'x net income; and (6) other direct costs and
expenses incurred by Bechtel that are incidental to and reasonably necessary for
the performance of the Services.
3.4 Invoicing and Payment. Bechtel shall prepare and submit to Client progress
invoices covering the Services on a biweekly basis. Each such invoice shall
reference this Agreement and the Work Order under which the Services were
performed and will be supported by such substantiating data as Client may
reasonably require. Client shall pay Bechtel the total amount shown to be due on
any such invoice within fifteen (15) calendar days of receipt of such invoice.
Page 3
All payments hereunder shall be made by electronic wire transfer to the account
designated by Bechtel. Should Client dispute any portion of an invoice, Client
shall pay the undisputed portion within fifteen (15) calendar days from the date
of receipt and, within the same time, advise Bechtel in writing of the disputed
portion.
3.5 Late Payment. Amounts owed to Bechtel beyond fifteen (15) calendar days
after receipt of invoice by Client shall accrue interest each day such invoice
is not paid at the lesser of: (1) a rate equal to two percent (2%) above the
prime lending rate quoted to substantial and responsible commercial borrowers on
ninety day loans by the Xxxxxx Guaranty Trust Company of New York, USA each day
such interest accrues; or (2) the maximum rate permitted by applicable law.
4.0 ACCOUNTING OF COSTS
Bechtel shall maintain books and accounts of the Recoverable Costs in accordance
with Xxxxxxx'x established accounting policies and practices. Client shall have
access to these books and accounts during Xxxxxxx'x normal business hours for
the duration of the applicable Work Order and for a period of one year after
completion or termination of the Services thereunder, to the extent required to
verify the Recoverable Costs invoiced hereunder (not including the hourly rates,
fixed rates, or cost agreed to by Bechtel and Client).
5.0 LIMITATION ON LIABILITY AND INSURANCE
5.1 Property Damages. Client shall provide for Bechtel to be included under any
project insurance coverage maintained for any project to which the Services
relate. Under no circumstances shall Bechtel or its subcontractors or suppliers
be liable for any loss of or damage to Client's property or property in Client's
custody, or for goods or services furnished by others.
5.2 Insurance.
5.2.1 Bechtel Insurance. While it is performing Services under any Work
Order, Bechtel shall maintain comprehensive general liability insurance
(with minimum limits of liability at least equal to $1,000,000 per
occurrence and $2,000,000 in the aggregate) for claims for damages due to
bodily injury (inclusive of death) and property damage arising out of acts
or omissions of Bechtel, its agents, servants, and employees. Bechtel
shall provide for Client to be included as an additional insured under any
such insurance coverage. Bechtel shall also maintain workers' compensation
coverage as may be required by applicable law.
5.2.2 Client Insurance. Prior to commencement of Services at the Project
sites, Client shall procure and maintain (or upon Client's request,
Bechtel shall obtain at Client's expense), during the performance of the
Services and for such additional period as hereinafter specified,
Builder's Risk Insurance described below covering Client, Bechtel and all
contractors and subcontractors at every tier as Named Insureds. Such
insurance shall include a waiver of subrogation in favor of all Named
Insureds. Client shall maintain Builder's Risk Insurance, insuring on an
"All Risks" basis with a limit of not
Page 4
less than the full insurable replacement cost of the Project, subject to
reasonable and customary deductible amounts as selected by Client, and
covering the Project and all materials and equipment to be incorporated
therein, including property in transit, in storage or elsewhere. Such
insurance shall state that it is primary, shall include coverage for
physical damage resulting in any way from the Services, including physical
loss or damage resulting from design error, faulty workmanship or
defective materials, and shall include an insurer's waiver of subrogation
or right of recourse in favor of each Named Insured thereunder.
Furthermore, such insurance shall remain in effect until the entire
Project is completed and accepted by Client.
5.3 Consequential Damages. Under no circumstances shall Bechtel or its
subcontractors or suppliers be liable for any consequential, indirect, or
incidental losses or damages, including but not limited to loss of use, lost
revenues or profits, costs of purchased or replacement power, costs of capital
or financing, increased operating costs, loss of goodwill, contractual claims by
third parties, and regulatory sanctions, and Client hereby releases Bechtel from
any such liability. Any costs incurred by Bechtel as a result of any such loss
or damage shall be Recoverable Costs under this Agreement.
5.4 Total Liability. Xxxxxxx'x total liability to Client arising out of or in
connection with this Agreement or any particular Services requested under this
Agreement, however caused, shall in no event exceed the lesser of (a) the amount
of compensation received by Bechtel under the Work Order under which such
liability arises, or (b) $500,000 in the cumulative aggregate for all causes
arising out of or in connection with this Agreement, and Client hereby releases
Bechtel from any liability in excess thereof.
5.5 Other Owners. Client represents and assures that releases of Bechtel from
liability, limitations on Xxxxxxx'x liability, and indemnities of Bechtel no
less protective than those expressed in this Agreement are or will be made
binding on all present and future assignees and successors to Client to which
Xxxxxxx'x Services relate. Client shall indemnify and defend Bechtel from any
claim or suit by or through any such assignees and successors to Client, or
liability resulting therefrom, to the extent that Xxxxxxx'x liability to Client
and all such assignees and successors to Client exceeds the aggregate amount for
which Bechtel would be liable to Client under the terms of this Agreement,
5.6 Applicability. Bechtel disclaims and Client agrees to waive any standards of
performance or warranties, including implied or statutory warranties, other then
those expressed in this Agreement. Client's remedies specified in this Agreement
are Client's exclusive remedies for liabilities of Bechtel arising under this
Agreement. Releases from liability, limitations on liability, and indemnities
expressed in this Agreement shall apply even in the event of Xxxxxxx'x fault or
negligence (in whole or in part), and whether founded in contract, tort, strict
liability, indemnity, or other basis of liability, and shall extend to Bechtel
and its affiliated companies and its and their shareholders, directors,
officers, employees, agents, and subcontractors (if any).
6.0 FORCE MAJEURE
Page 5
Bechtel shall not be considered in default in the performance of its obligations
hereunder to the extent that the performance of any such obligation is prevented
or delayed or becomes impracticable by reason of any cause that is beyond
Xxxxxxx'x reasonable control, including changes in applicable law or the
interpretation thereof, and including action, inaction, or delay by Client or by
any other contractor or supplier to Client. In any such event of force majeure,
Bechtel shall advise Client of the effect of such event, and the parties shall
negotiate an equitable adjustment to their respective obligations under this
Agreement.
7.0 RIGHTS TO WORK PRODUCT
7.1 Ownership. Final drawings, specifications, reports, and data developed by
Bechtel as a part of Services shall become the property of Client upon payment
therefor. Ownership of the copyright and other underlying intellectual property
rights to work developed by Bechtel as part of the Services which relate:
(i) to tools and techniques used for project management, engineering, and
construction shall remain with Bechtel and Client shall have a perpetual,
royalty free license to use such rights for use in its telecommunications
business, and
(ii) to telecommunications software or hardware shall be the property of
the Client (provided the Services are paid for). .
Bechtel reserves all rights to information, including software, that may be used
in connection with the Services but that is neither developed under this
Agreement nor originally obtained from Client.
7.2 Exclusive Use. Xxxxxxx'x work product under this Agreement shall be for the
use solely of Client and solely for the project or other purpose to which such
work product relates, and Client releases and agrees to hold Bechtel harmless
from any claim or liability arising from any unauthorized use of such work
product. The provisions of this Article shall survive termination of this
Agreement.
8.0 CONFIDENTIALITY
8.1 The Parties acknowledge entering into a Mutual Non-Disclosure Agreement
("NDA") a copy of which is attached hereto as Attachment C, and agree that the
terms of the NDA are incorporated herein. Any information provided by either
party to the other in connection with this Agreement that is designated in
writing by the disclosing party as confidential in accordance with the terms of
the NDA shall be subject to the terms of the NDA.
8.2 Survival. The parties' obligations under this Article 8.0 shall survive
expiration or termination of this Agreement.
9.0 SUBCONTRACTING
Page 6
Bechtel may subcontract its Services in whole or in part and/or disclose
confidential information to its affiliated entities without the prior approval
of Client. Bechtel hereby guarantees to Client that such affiliated entities
will comply with the responsibilities and liabilities herein assumed by Bechtel,
and Client agrees to hold only Bechtel responsible for any failure to so comply.
Client agrees that the limitations on Xxxxxxx'x liability set forth in this
Agreement constitute the aggregate limit of liability of Bechtel and its related
entities under this Agreement.
10.0 SUSPENSION AND TERMINATION
10.1 Termination for Convenience. Either party may terminate this Agreement at
any time upon not less than fifteen (l5) days prior written notice to the other,
provided that termination by Bechtel shall not affect completion of uncompleted
Services except with Client's consent. In addition, Client may suspend or
terminate any Work Order at any time upon not less than fifteen (15) days prior
written notice to Bechtel.
10.2 Termination for Nonpayment. In the event any amount due Bechtel under this
Agreement becomes overdue by more than fifteen (15) days, Bechtel may suspend
providing Services under the applicable Work Order(s), and may withhold
providing further Services under this Agreement, until such past due amounts and
interest due thereon are paid, without thereby being in default and without
prejudice to any of its rights or remedies under this Agreement or at law. If
Client continues to fail to pay amounts due within thirty (30) days after the
commencement of any such suspension, Bechtel may terminate the affected Work
Order(s).
10.3 Effect of Termination. In the event of a termination under this Article,
Bechtel shall cease performance of the affected Services as applicable, and
shall take such winding-up actions in connection with such termination as Client
may reasonably direct. Promptly after any such termination, Bechtel shall submit
an invoice for, and Client shall pay to Bechtel, all compensation due for the
terminated Services, plus all Recoverable Costs reasonably incurred as a result
of the termination.
11.0 GENERAL
11.1 Entire Agreement. This Agreement, as it may be amended and implemented
through Work Orders from time to time, constitutes the entire agreement between
the parties relating to the subject matter hereof, and supersedes any previous
proposals, representations, or understandings except as may be specifically
incorporated herein.
11.2 Pre-Agreement Services. Any Services provided for herein that were
performed or furnished by Bechtel prior to the effective date of this Agreement
shall be deemed to have been performed under this Agreement.
11.3 Amendments. This Agreement may not be modified except by an instrument in
writing signed by authorized representatives of both parties.
Page 7
11.4 Severability. In the event that any of the provisions of this Agreement, or
portions or applications thereof, are held to be unenforceable or invalid by any
court of competent jurisdiction, Client and Bechtel shall negotiate an equitable
adjustment to the provisions of this Agreement with a view toward effectuating
to the extent possible the original purpose of this Agreement, and the validity
and enforceability of the remaining provisions, or portions or applications
thereof, shall not be affected thereby.
AMBIENT CORPORATION XXXXXXX CORPORATION
By /s/ Xxxx X. Xxxxxxxx By /s/ Xxxxxx X. Xxxxxxx
----------------------------- ---------------------------------
Name (print) Xxxx X. Xxxxxxxx Name (print) Xxxxxx X. Xxxxxxx
--------------------------- -------------------------------
Title Chief Executive Officer Title President
--------------------------- ------------------------------
Date February 19, 2001 Date February 23, 2001
--------------------------- -------------------------------
Page 8
