AMENDED AND RESTATED MASTER FRAMEWORK AGREEMENT between TXU ELECTRIC DELIVERY COMPANY and INFRASTRUX ENERGY SERVICES GROUP LP Dated June 24, 2006
Exhibit
10.j
EXECUTION
COPY
CONFIDENTIAL
TREATMENT REQUESTED.
CONFIDENTIAL
PORTIONS OF THIS DOCUMENT
HAVE
BEEN REDACTED AND HAVE BEEN FILED
WITH
THE COMMISSION.
AMENDED
AND RESTATED
between
TXU
ELECTRIC DELIVERY COMPANY
and
INFRASTRUX
ENERGY SERVICES GROUP LP
Dated
June 24, 2006
AMENDED
AND RESTATED
MASTER
AGREEMENT
TABLE
OF CONTENTS
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Page
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CONDITIONS,
BACKGROUND AND OBJECTIVES
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1
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1.1
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Eligible
Recipients
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1
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1.2
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TXUED
Minimum Expenditures
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2
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1.3
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Termination
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4
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2.
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DEFINITIONS
AND DOCUMENTS
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4
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2.1
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Definitions
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4
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2.2
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Other
Terms
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4
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2.3
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Services
Agreements
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4
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3.
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TERM
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5
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3.1
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Initial
Term
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5
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3.2
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Extension
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5
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3.3
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Services
Agreement
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5
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4.
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SERVICES
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5
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4.1
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General
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5
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4.2
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Termination
Assistance Services
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6
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4.3
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Use
of Third Parties
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8
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4.4
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Employee
Transfers
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9
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4.5
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Governance
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9
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5.
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RESERVED
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9
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6.
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FACILITIES,
SOFTWARE, EQUIPMENT, CONTRACTS AND ASSETS ASSOCIATED WITH THE PROVISION
OF
SERVICES
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9
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6.1
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Service
Facilities
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9
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6.2
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Use
of Vendor Facilities
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11
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6.3
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TXUED
Rules / Employee Safety
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12
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6.4
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Notice
of Defaults
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14
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7.
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SERVICE
LEVELS
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14
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7.1
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General
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14
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7.2
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Service
Level Credits
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14
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7.3
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Problem
Analysis
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14
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AMENDED
AND RESTATED
MASTER
AGREEMENT
TABLE
OF CONTENTS
(continued)
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Page
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7.4
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Continuous
Improvement Reviews
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15
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7.5
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Measurement
and Monitoring
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15
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7.6
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Notice
of Adverse Impact
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15
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7.7
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Key
Vendor Personnel
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15
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7.8
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Vendor
Account Executive
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17
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7.9
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Vendor
Personnel Are Not TXUED Employees; Independent
Relationship
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18
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7.10
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Replacement,
Qualifications, and Retention of Vendor Personnel
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18
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7.11
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Conduct
of Vendor Personnel
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19
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7.12
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Substance
Abuse
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19
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8.
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VENDOR
RESPONSIBILITIES
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19
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8.1
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Policy
and Procedures Manual
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19
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8.2
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Reports
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19
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8.3
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Reserved
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20
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8.4
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Audit
Rights
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20
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8.5
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Agency
and Disbursements
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23
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8.6
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Subcontractors
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24
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8.7
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Requirement
of Writing
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25
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8.8
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Seconded
TXUED Personnel
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26
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8.9
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Seconded
Vendor Personnel
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26
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9.
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TXUED
RESPONSIBILITIES
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26
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9.1
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Responsibilities
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26
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9.2
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Savings
Clause
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27
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10.
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CHARGES
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28
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10.1
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General
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28
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10.2
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Pass-Through
Expenses
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29
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10.3
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Incidental
Expenses
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30
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10.4
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Taxes
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30
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10.5
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New
Services
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32
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-ii-
AMENDED
AND RESTATED
MASTER
AGREEMENT
TABLE
OF CONTENTS
(continued)
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Page
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10.6
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Proration
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34
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10.7
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Refundable
Items
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34
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10.8
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***
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34
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11.
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INVOICING
AND PAYMENT
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34
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11.1
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Invoicing
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34
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11.2
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Payment
Due
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35
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11.3
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Set
Off
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36
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11.4
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Disputed
Charges
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36
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12.
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TXUED
DATA AND OTHER PROPRIETARY INFORMATION
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36
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12.1
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TXUED
Ownership of TXUED Data
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36
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12.2
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Safeguarding
TXUED Data
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37
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12.3
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Confidentiality
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38
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12.4
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File
Access
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41
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13.
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REPRESENTATIONS,
WARRANTIES AND ADDITIONAL COVENANTS
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41
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13.1
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Reserved
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41
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13.2
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Authorization
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41
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13.3
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Compliance
with Laws
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42
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13.4
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Resources
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44
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13.5
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Non-Infringement
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44
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13.6
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TXUED
2004 Base Case
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44
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13.7
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Reserved
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44
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13.8
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Disclaimer
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45
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14.
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INSURANCE
AND RISK OF LOSS
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45
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14.1
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Vendor
Insurance
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45
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15.
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INDEMNITIES
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45
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15.1
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Indemnity
by Vendor
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45
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15.2
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Indemnity
by TXUED
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47
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15.3
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Reserved
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49
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***
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CONFIDENTIAL MATERIAL REDACTED AND FILED
SEPARATELY WITH THE COMMISSION.
|
-iii-
AMENDED
AND RESTATED
MASTER
AGREEMENT
TABLE
OF CONTENTS
(continued)
|
Page
|
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15.4
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Indemnification
Procedures
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49
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15.5
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Indemnification
Procedures - Governmental Claims
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50
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16.
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LIABILITY
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51
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16.1
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Force
Majeure
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51
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16.2
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Limitation
of Liability
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53
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16.3
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Non-Recourse
Liabilities
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54
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17.
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DISPUTE
RESOLUTION
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55
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17.1
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Informal
Dispute Resolution
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55
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17.2
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Jurisdiction
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57
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17.3
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Continued
Performance
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58
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17.4
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Governing
Law
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58
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18.
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TERMINATION
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58
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18.1
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Termination
for Cause
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58
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18.2
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Reserved
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59
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18.3
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Termination
for Insolvency
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59
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18.4
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TXUED
Rights Upon Vendor’s Bankruptcy
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60
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18.5
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Utility
Regulation
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61
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18.6
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Reserved
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61
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18.7
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Reserved
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61
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18.8
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Reserved
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61
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18.9
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Termination
For Convenience
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61
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18.10
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Cross
Termination Rights and Termination Charges
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61
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18.11
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Equitable
Remedies
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62
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19.
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GENERAL
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62
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19.1
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Binding
Nature and Assignment
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62
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19.2
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Entire
Agreement; Amendment
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63
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19.3
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Notices
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63
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19.4
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Counterparts
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64
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|
-iv-
AMENDED
AND RESTATED
MASTER
AGREEMENT
TABLE
OF CONTENTS
(continued)
|
Page
|
|||
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19.5
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Headings
|
64
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19.6
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Relationship
of Parties
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64
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19.7
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Severability
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64
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19.8
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Approvals
and Consents
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64
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19.9
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Waiver
of Default; Cumulative Remedies
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64
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19.10
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Survival
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65
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19.11
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Publicity
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65
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19.12
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Export
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65
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19.13
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Third
Party Beneficiaries
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65
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19.14
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Assignment
of Agreement For Financing
|
65
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19.15
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Order
of Precedence
|
66
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19.16
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Hiring
of Employees
|
66
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19.17
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Further
Assurances
|
66
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19.18
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Liens
|
66
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19.19
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Acknowledgment
|
67
|
-v-
AMENDED
AND RESTATED
MASTER
AGREEMENT
This
Master Framework Agreement (this “Master
Agreement”)
is
entered into effective June 24, 2006 (the
“Master
Agreement Effective Date”)
by and
between TXU
ELECTRIC DELIVERY COMPANY,
a Texas
corporation having a principal place of business at Lincoln Plaza, 000 X. Xxxxx
Xxxxxx, Xxxxxx, Xxxxx 00000 (“TXUED”),
and
INFRASTRUX
ENERGY SERVICES GROUP LP,
a
Delaware limited partnership having a principal place of business at 000 X.
0xx
Xxxxxx,
Xxxx Xxxxx, Xxxxx 00000 (“Vendor”).
WHEREAS,
the purpose of this Master Agreement is to establish the overall contractual
framework for TXUED’s and Vendor’s relationship and set forth terms and
conditions that apply to all Services provided by Vendor;
WHEREAS,
Affiliates of TXUED and Affiliates of InfrastruX Group, Inc., a Washington
corporation, have created Vendor, a Delaware limited partnership which shall
provide services to TXUED in accordance with this Agreement;
WHEREAS,
simultaneous with entering into this Master Agreement, TXUED and Vendor have
entered into the Initial Services Agreement pursuant to which Vendor shall
provide certain field services to TXUED and the Eligible Recipients;
and
WHEREAS,
TXUED may request that Vendor provide certain other services to TXUED and the
Eligible Recipients pursuant to the Initial Services Agreement or a New Services
Agreement.
NOW
THEREFORE, in consideration of the mutual promises and covenants contained
herein and of other good and valid consideration, the receipt and sufficiency
of
which is hereby acknowledged, TXUED and Vendor (collectively, the “Parties”
and
each, a “Party”)
hereby
agree as follows:
|
1.
|
CONDITIONS,
BACKGROUND AND OBJECTIVES
|
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1.1
|
Eligible
Recipients.
Upon TXUED’s request, Vendor shall provide the Services to Eligible
Recipients at Charges determined in accordance with Exhibit
11,
provided that Eligible Recipients that are not Controlled by TXUED
agree
with TXUED to be bound by the terms of this Agreement. Upon Vendor’s
reasonable request, Eligible Recipients shall execute a written
instrument, in a form reasonably requested by Vendor, in favor of
Vendor
agreeing to be bound by the terms of this Agreement. For purposes
of this
Agreement, Services provided to an Eligible Recipient shall be deemed
Services provided to TXUED. To the extent an Eligible Recipient is,
or was
at any time during the Term, receiving Services, (1) references to
TXUED shall include such Eligible Recipient (including for purposes
of the
business, operations, policies, procedures, rules, standards and
the like
of TXUED and the indemnities under this Agreement), (2) references to
Services being performed for or provided to, or received by or used
by,
TXUED shall include the performance of such Services for and provision
of
such Services to, and the receipt of and use of such Services by,
such
Eligible Recipient and (3) TXUED shall be responsible for such
Eligible Recipient’s acts and omissions in connection with this Agreement,
including compliance with this Agreement. Notwithstanding
the immediately preceding sentence, Eligible Recipients are neither
authorized to direct or instruct Vendor nor to act for or on behalf
of
TXUED (including by providing notices, approvals, consents, waivers
or the
like), in each case unless TXUED has notified Vendor that an Eligible
Recipient is so authorized. Vendor will not be liable for any failure
to
act (or any delay associated therewith) in any circumstance where
TXUED
has failed to properly authorize such action in accordance with the
preceding sentences. Without limiting the generality of the foregoing,
in
all circumstances under this Agreement, TXUED will be Vendor’s sole point
of contact regarding the Services.
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Page
1 of
67
AMENDED
AND RESTATED
MASTER
AGREEMENT
|
1.2
|
TXUED
Minimum Expenditures.
|
|
(a)
|
TXUED
agrees that the Charges paid to Vendor (including any Termination
Charges)
under this Agreement (the “Cumulative
Total Spend”)
during the applicable period of Contract Years set forth in the table
below (each such period, a “Contract
Period”)
will equal or exceed the applicable amount corresponding to each
Contract
Period as set forth in such table (the “Cumulative
Spend Commitment”).
|
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Contract
Period
|
Cumulative
Spend Commitment
|
|
Contract
Years 1 and 2
|
$1,740,000,000
|
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Contract
Years 1 through 4
|
$3,480,000,000
|
|
Contract
Years 1 through 6
|
$5,220,000,000
|
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Contract
Years 1 through 8
|
$6,960,000,000
|
|
Contract
Years 1 through 10
|
$8,700,000,000
|
|
(b)
|
If
TXUED’s Cumulative Total Spend during a Contract Period (except with
respect to TXUED’s Cumulative Total Spend during the Contract Period for
Contract Years 1 through 10) does not equal or exceed the corresponding
Cumulative Spend Commitment for that Contract Period, then unless
this
Agreement is terminated earlier as provided herein, on the date that
is
thirty (30) days following the end of such Contract Period, and on
the
date that is thirty (30) days following the first anniversary of
such
date, TXUED shall pay to Vendor an amount equal to the product of
the
following calculation: (the applicable Cumulative Spend Commitment
- the
actual Cumulative Total Spend) x (the then current rate set by Citibank,
N.A. as its prime lending rate) x (thirteen percent (13%)). If TXUED’s
Cumulative Total Spend equals or exceeds the Cumulative Spend Commitment
for a Contract Period, then TXUED shall not owe Vendor any amounts
pursuant to the immediately preceding
sentence.
|
|
(c)
|
If
TXUED’s Cumulative Total Spend during the Contract Period for Contract
Years 1 through 10 does not equal or exceed eight billion seven hundred
million dollars ($8,700,000,000), then unless this Agreement is terminated
earlier as provided herein, on the last day of the quarter in which
the
tenth (10th)
anniversary of the Services Agreement Commencement Date for the Field
Services Agreement falls and on the last day of each subsequent quarter
thereafter, TXUED shall pay to Vendor an amount equal to the product
of
the following calculation: (($8,700,000,000 - TXUED’s actual total spend
for its Transmission System and its Distribution System over the
period
from the Services Agreement Commencement Date for the Field Services
Agreement through the applicable anniversary of such date) x (the
then
current rate set by Citibank, N.A. as its prime lending rate) x thirteen
percent (13%)) / four (4); provided, however, that the first payment
shall
be prorated to the extent the tenth (10th)
anniversary of the Services Agreement Commencement Date for the Field
Services Agreement does not fall on the last day of the applicable
quarter. Once TXUED’s Cumulative Total Spend equals or exceeds an
aggregate amount of eight billion seven hundred million dollars
($8,700,000,000), then TXUED shall no longer owe Vendor any amounts
pursuant to the immediately preceding
sentence.
|
Page
2 of
67
AMENDED
AND RESTATED
MASTER
AGREEMENT
|
(d)
|
For
the avoidance of doubt, Vendor acknowledges and agrees that its sole
and
exclusive remedy for TXUED’s breach of Section
1.2(a)
shall be the payments by TXUED pursuant to Section
1.2(b)
and Section
1.2(c).
|
|
(e)
|
If
TXUED’s failure to meet a Cumulative Spend Commitment results from
Vendor’s failure to comply with this Agreement, the amounts TXUED is
obligated to pay to Vendor under Section
1.2(b)
and Section
1.2(c),
as applicable, shall be reduced in proportion to the shortfall caused
by
Vendor’s failure to comply with this
Agreement.
|
|
(f)
|
If
the Charges paid to Vendor for labor, transportation and equipment
(“LTE”)
in respect of TXUED’s Transmission System do not exceed seventy million
dollars ($70,000,000) (excluding amounts spent by TXUED in order
to
procure materials and to transport materials) during any Contract
Year
during the first ten (10) years following the Services Agreement
Commencement Date for the Field Services Agreement, then within thirty
(30) days following the end of that Contract Year, TXUED shall pay
to
Vendor an amount equal to ten percent (10%) of the difference between
(i)
seventy million dollars ($70,000,000) minus
(ii) the Charges paid to Vendor for LTE in respect of TXUED’s Transmission
System during that Contract Year. For purposes of this Subsection,
Charges
spent for LTE in respect of those coal generation facilities that,
as of
the Master Agreement Effective Date, an Affiliate of TXUED has publicly
announced its intent to construct shall be excluded from the Charges
paid
to Vendor for LTE in respect of TXUED’s Transmission
System.
|
|
(g)
|
The
Parties agree that the terms of this Section (except for Section
1.2(d))
shall not survive any termination or expiration of this Agreement.
For the
avoidance of doubt, this Section
1.2(g)
does not limit any damages that Vendor may be permitted to recover
from
TXUED in connection with a breach of this
Agreement.
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1.3
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Termination.
If (a) the Closing Date (under and as defined in the Participation
Agreement, dated June 24, 2006, among InfrastruX Group, Inc., a Washington
corporation, TXU Asset Services Company LLC, a Delaware limited liability
company, and (for certain limited purposes only) TXU Electric Delivery
Company, a Texas corporation), has not occurred by December 31, 2006,
as
such date may be extended by the Parties, or (b) the Participation
Agreement terminates for any reason prior to the Closing Date, then
in
either case this Agreement shall automatically terminate without
action by
either Party and neither Party shall have any liability to the other
Party
as a result of such termination.
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2.
|
DEFINITIONS
AND DOCUMENTS
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2.1
|
Definitions.
The terms used with initial capital letters in this Agreement shall
have
the meanings ascribed to them in this Master Agreement (including
Exhibit 1)
or the applicable Services
Agreement.
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2.2
|
Other
Terms.
The defined terms include the plural as well as the singular and
the
derivatives of such terms. The term “Agreement” shall be read and
understood to mean this Master Agreement and each Services Agreement
entered into hereunder, and all references to this Master Agreement
shall
include the Exhibits, Schedules and other attachments to this Master
Agreement and all references to a Services Agreement shall include
all
Schedules and other attachments to that Services Agreement, unless
otherwise specified. Unless otherwise expressly stated, the words
“herein,” “hereof,” “hereunder” and other words of similar import when
used in this Agreement (including the Services Agreements) refer
to this
Master Agreement (or the applicable Services Agreement) as a whole
and not
to any particular Article, Section, Subsection or other subdivision.
Article, Section, Subsection, Exhibit and Schedule references refer
to
articles, sections and subsections of, and exhibits and schedules
to, this
Master Agreement (or if used in a Services Agreement, to such Services
Agreement). The words “include” and “including” shall not be construed as
terms of limitation. The words “day,” “month” and “year” mean,
respectively, calendar day, calendar month and calendar year. As
stated in
Section 19.3,
the word “notice” and “notification” and their derivatives shall mean
notice or notification in writing. Except as otherwise provided in
this
Agreement, all amounts are set forth in U.S. Dollars. Other terms
used in
this Agreement are defined in the context in which they are used
and shall
have the meanings there indicated. Unless otherwise expressly stated,
references to specific Exhibits or Schedules include all numbered
or
lettered subsidiary Exhibits or Schedules (e.g., references to
Schedule
G
include not only Schedule
G,
but also Schedules
X.0,
X.0
and G.3)
and all attachments and annexes
thereto.
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2.3
|
Services
Agreements.
Simultaneously with entering into this Master Agreement, TXUED and
Vendor
have entered into the Initial Services Agreement. The Initial Services
Agreement incorporates by reference the terms of this Master Agreement.
Subject to Section
10.5,
TXUED may request that Vendor provide New Services. The Parties shall
work
to complete and execute either (i) a New Services proposal (in
accordance with Section 10.5(a))
or (ii) a New Services Agreement, to address Vendor’s provision of
such services.
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3.
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TERM
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3.1
|
Initial
Term.
The initial term of this Master Agreement shall commence as of 12:00:01
a.m., Central Time, on the Master Agreement Effective Date and continue
until the later of (a) 11:59:59 p.m., Central Time, on the tenth
(10th)
anniversary of the Services Agreement Commencement Date for the Field
Services Agreement and
(b) such date as of which the aggregate amount specified in Section
1.2(c)
has been spent by TXUED, unless this Master Agreement is terminated
earlier as provided herein, in which case the initial term shall
end at
11:59:59 p.m., Central Time, on the effective date of such
termination (the “Initial
Term”).
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3.2
|
Extension.
If TXUED desires to renew this Master Agreement after the Initial
Term or
any Renewal Term, TXUED shall provide written notice to Vendor of
its
desire to do so at least one hundred eighty (180) days prior to the
expiration of the Initial Term or the then current Renewal Term.
The
Parties shall thereafter negotiate with respect to the terms and
conditions upon which the Parties may renew this Master Agreement
and if
the Parties reach agreement thereafter execute such renewal (each,
a
“Renewal
Term”).
In the event the Parties are unable to reach agreement and execute
such
renewal at least one hundred twenty (120) days prior to the expiration
of
the Initial Term or the then current Renewal Term, TXUED may, at
its sole
option, by delivery of notice to Vendor at least ninety (90) days
prior to
the expiration of the Initial Term or the then current Renewal Term,
extend the Initial Term or the then current Renewal Term for one
(1)
additional period of up to twelve (12) months (the exact period of
which
shall be specified in TXUED’s notice of extension) on terms and conditions
then in effect. The Initial Term and the Renewal Terms, if any, including
any period of Termination Assistance Services provided by Vendor
hereunder, are collectively referred to as the “Term.”
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3.3
|
Services
Agreement.
The term of a Services Agreement, if different than the Term, shall
be set
forth in the applicable Services Agreement; provided, however, that
in no
event shall the term of a Services Agreement extend beyond the Term
of
this Master Agreement.
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4.
|
SERVICES
|
|
4.1
|
General.
Services to be provided to TXUED by Vendor shall be governed by the
terms
set forth in this Master Agreement and such additional terms as are
contained in the Services Agreement pursuant to which such Services
are
being provided.
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(a)
|
Services.
Commencing on a Services Agreement Commencement Date (or such later
date
as is specified in the applicable Services Agreement) and continuing
throughout the term of such Services Agreement, Vendor shall be
responsible for providing to TXUED and, as directed by TXUED, to
Eligible
Recipients, any or all of the
following:
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|
(i)
|
the
services, functions and responsibilities described in this Agreement
(including Schedule
E
to
the Services Agreements) as they may be supplemented, enhanced, modified
or replaced in accordance with this
Agreement;
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(ii)
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Reserved;
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(iii)
|
any
New Services, upon TXUED’s acceptance of Vendor’s proposal for such New
Services in accordance with Section 10.5
and the other provisions of this Agreement;
and
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(iv)
|
unless
otherwise agreed by the Parties, the services, functions and
responsibilities (y) specified in or reasonably inferable from the
TXUED
2004 Base Case, if any, attached to the applicable Services Agreement
and/or (z) performed during the twelve (12) months preceding the
Services
Agreement Effective Date of such Services Agreement by TXUED Affected
Personnel as reasonably demonstrated by TXUED, or upon TXUED’s request,
demonstrated by the Transitioned Employees acting in good faith (clauses
(i) through (iv) of this Section, the “Services”).
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(b)
|
Included
Services.
If any services, functions or responsibilities not specifically described
in this Agreement are a necessary part of the Services, they shall
be
deemed to be included within the scope of the Services to be delivered
for
the Charges, as if such services, functions or responsibilities were
specifically described in this
Agreement.
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(c)
|
Required
Resources.
Except as otherwise expressly provided in this Agreement, Vendor
shall be
responsible for providing the Resources, knowledge, expertise,
methodologies, processes and other means necessary to provide the
Services.
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(d)
|
No
Control of Electrical System.
Notwithstanding anything to the contrary in this Agreement, the Parties
do
not intend for Vendor to control or operate the Electrical System
or
Utility Facilities, it being acknowledged and agreed that TXUED shall
retain all control and operation of the Electrical System and Utility
Facilities in accordance with all applicable
Laws.
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(e)
|
No
Competitive Energy Services.
Vendor will not provide in the State of Texas to any third party
(including any Affiliate of Vendor) any product or service that would
constitute a “competitive energy service” as such term is defined in
Section 25.341 of the Texas Administrative Code, or that would otherwise
cause Vendor to be a “competitive affiliate” of TXUED, as that term is
defined in Section 25.272 of the Texas Administrative
Code.
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4.2
|
Termination
Assistance Services.
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|
(a)
|
Availability.
As part of the Services, and for the Charges to be determined in
accordance with Exhibit
11,
upon TXUED’s request, Vendor shall provide to TXUED the Termination
Assistance Services under and in accordance with the applicable Services
Agreement.
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(b)
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Period
of Provision.
Vendor shall provide the Termination Assistance Services to TXUED
(i) upon ninety (90) days’ prior notice from TXUED commencing up to
nine (9) months prior to the scheduled expiration of the applicable
Services Agreement and continuing for up to twelve (12) months following
the scheduled effective date of the expiration of the applicable
Services
Agreement, (ii) commencing upon any notice of termination (including
notice based upon breach or default by TXUED, breach or default by
Vendor
or termination for convenience by TXUED (subject to Subsection (d)
below))
of the applicable Services Agreement and continuing for up to twelve
(12) months following the specified effective date of such
termination, (iii) commencing upon notice of removal of an Eligible
Recipient by TXUED and continuing for up to twelve (12) months following
the effective date of such removal, (iv) commencing upon notice from
TXUED that there will be an insourcing or resourcing under the applicable
Services Agreement of any Services and continuing for up to twelve
(12)
months following the effective date of such notice (to the extent
that
this Agreement expressly permits TXUED to insource or resource such
Services) or (v) commencing
upon notice that TXUED has elected to discontinue the provision of
Services to a line of business of TXUED and
continuing for up to twelve (12) months following the effective date
of
such discontinuance (to the extent that this Agreement expressly
permits
TXUED to discontinue
the provision of Services to a line of business of TXUED).
If any period for performing any Termination Assistance Services
extends
beyond the expiration or the effective date of any termination of
this
Master Agreement or any applicable Services Agreement(s), the provisions
of this Master Agreement and such Services Agreement(s) shall remain
in
full effect for the duration of such
period.
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(c)
|
Extension
of Services.
TXUED may elect, upon one hundred eighty (180) days’ prior notice, to
extend the effective date of any expiration or termination of any
Services, in its sole discretion, provided that the total of all
such
extensions will not exceed one hundred eighty (180) days following
the
originally specified effective date without Vendor’s prior written consent
and the period of extension shall be specified in TXUED’s notice. TXUED
also may elect, upon one hundred eighty (180) days’ prior notice, to
extend the period for the performance of any Termination Assistance
Services, provided that the date on which Vendor begins providing
such
Termination Assistance Services and the completion of such Termination
Assistance Services is not greater than eighteen (18) months and
the
period of extension shall be specified in TXUED’s
notice.
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(d)
|
Firm
Commitment.
Vendor shall provide Termination Assistance Services to TXUED regardless
of the reason for the expiration or termination of this Agreement
or the
applicable Services Agreement; provided, however, that if Vendor
terminates this Agreement pursuant to Section
18.1(b),
then TXUED must pay to Vendor all undisputed unpaid amounts then
due and
owing to Vendor under this Agreement and continue to pay invoices
in
accordance with Article
11
prior to Vendor being obligated to provide the Termination Assistance
Services.
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(e)
|
Performance.
At TXUED’s request, Vendor shall provide Termination Assistance Services
directly to TXUED’s designee, any Eligible Recipient or an Entity
acquiring Control of an Eligible Recipient. Unless otherwise agreed
by the
Parties, all such Termination Assistance Services shall be performed
subject to and in accordance with the terms and conditions of this
Agreement and Vendor shall perform the Termination Assistance Services
with at least the same degree of accuracy, quality, completeness,
timeliness, responsiveness and resource efficiency as it provided
and was
required to provide in respect of the same or similar Services.
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4.3
|
Use
of Third Parties.
|
|
(a)
|
Right
of Use.
TXUED shall not be permitted to insource or resource any of the scope
or
volume of Services being provided by the Transitioned Employees as
of the
Master Agreement Effective Date (which, for the avoidance of doubt,
means
the scope and volume of the Services outsourced to Vendor under the
Field
Services Agreement as of the Services Agreement Effective Date for
the
Field Services Agreement); provided, however, that (i) TXUED shall
be
permitted to insource or resource any such Services in any of the
following circumstances (1) if and to the extent permitted pursuant
to the
terms of Schedule
E
to
a Services Agreement, (2) if and to the extent permitted pursuant
to the
terms of Section
16.1(c),
(3) if and to the extent the Parties must negotiate Variable Charges
that
are not based on the “Unit Prices” set forth in Exhibit
11,
(4) that TXUED reasonably believes in good faith Vendor is unable
to
perform in accordance with TXUED’s requirements (including any applicable
TXUED Rules or TXUED Standards) and within fifteen (15) days after
receiving notice from TXUED, Vendor is unable to demonstrate to TXUED’s
satisfaction that Vendor is able to perform in accordance with TXUED’s
requirements or (5) that Vendor refuses, for whatever reason, to
provide
to TXUED or any Eligible Recipient (including any other Services
that are
related to or are a necessary part of the Services that Vendor refuses
to
provide) and (ii) TXUED shall be required to obtain from Vendor any
Services in respect of any assets acquired by TXUED on or after the
Master
Agreement Effective Date (except for any assets acquired by TXUED
after
the Master Agreement Effective Date by way of merger or consolidation
or
through the acquisition of all or substantially all of the shares
or
assets of any Entity as a going concern, provided that the foregoing
exception shall not limit the terms of any other agreements to which
TXUED
or any of TXUED’s Affiliates are a party to with Vendor or any of Vendor’s
Affiliates). Nothing in this Agreement shall be construed or interpreted
as (y) a requirements contract or, except as set forth in the immediately
preceding sentence, creating any exclusive relationship or (z) preventing
TXUED obtaining from third parties (each, a “TXUED
Third Party Contractor”),
or providing to itself, any other services, functions or responsibilities
(including any New Services), except as set forth in the immediately
preceding sentence. Except as specifically provided in this Agreement,
nothing in this Agreement shall be construed or interpreted as limiting
TXUED’s right or ability to add or delete Eligible Recipients. Nothing
in
this Agreement shall be construed or interpreted as limiting TXUED’s right
or ability to increase or decrease its demand for Services. To the
extent
TXUED adds or deletes Eligible Recipients or increases or decreases
its
demand for Services, the Charges shall be adjusted in accordance
with
Exhibit
11.
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(b)
|
Vendor
Cooperation.
Vendor shall fully cooperate with and work in good faith with TXUED
and
TXUED Third Party Contractors as described in this Agreement or as
reasonably requested by TXUED in a manner consistent with this
Agreement.
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4.4
|
Employee
Transfers.
The transitioning of TXUED’s employees to Vendor under or in connection
with a Services Agreement or a New Service, if any, shall be effected
in
accordance with the terms and conditions set forth in Exhibit 2.
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|
4.5
|
Governance.
The Parties shall comply with the governance and account management
provisions set forth in Exhibit 8.
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|
5.
|
RESERVED
|
|
6.
|
FACILITIES,
SOFTWARE, EQUIPMENT, CONTRACTS AND ASSETS ASSOCIATED WITH THE PROVISION
OF
SERVICES
|
|
6.1
|
Service
Facilities.
|
|
(a)
|
Service
Facilities.
The Services shall be provided at or from (i) the TXUED Facilities,
(ii) the Vendor Facilities or (iii) any other service location
requested by Vendor and approved by TXUED. Vendor shall be financially
responsible for all additional costs, taxes or expenses related to
or
resulting from any Vendor-initiated relocation to a new or different
service location, including any reasonable costs or expenses directly
incurred (including internal costs) by TXUED as a result of such
relocation.
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|
(b)
|
TXUED
Facilities.
Commencing on the applicable Services Agreement Effective Date and
continuing for so long as Vendor requires the same for the performance
of
the Services, TXUED shall provide to Vendor the use (in accordance
with
TXUED’s corporate policies) of the space in the TXUED Facilities (as
designated by TXUED) that Vendor may require in connection with the
performance of the Services and not to exceed the space described
in
Schedule O.1
to
the applicable Services Agreement.
Vendor shall be financially responsible for providing all other facilities
needed by Vendor or Vendor Personnel (including Transitioned Employees)
to
provide the Services. Except as otherwise approved by TXUED, TXUED
owned
or leased assets provided for the use of Vendor under this Agreement
shall
remain located at TXUED Facilities to the extent located at TXUED
Facilities prior to the applicable Services Agreement Effective Date.
In
addition, all improvements or modifications to TXUED Facilities requested
by Vendor shall be (i) subject to review and approval in advance by
TXUED and (ii) performed by or through TXUED. Vendor shall reimburse
TXUED for the actual
direct reasonable costs and expenses
incurred in connection with such modifications or improvements.
EXCEPT
AS SET FORTH HEREIN, THE
TXUED FACILITIES ARE PROVIDED BY TXUED TO VENDOR ON AN AS-IS, WHERE-IS
BASIS. TXUED EXPRESSLY DISCLAIMS ANY WARRANTIES, EXPRESS OR IMPLIED,
AS TO
THE TXUED FACILITIES OR, EXCEPT AS SET FORTH HEREIN, QUIET ENJOYMENT
BY
VENDOR.
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(c)
|
Physical
Security.
TXUED is responsible for the physical security of the TXUED Facilities;
provided, that Vendor shall be responsible for the physical security
and
safety, physical access and control of the buildings or areas over
which
Vendor has exclusive control and Vendor shall not permit any person
to
have access to, or control of, any such area unless such access or
control
is permitted in accordance with control procedures approved by TXUED
or
any higher standard agreed to by TXUED and Vendor. Vendor shall be
solely
responsible for compliance by Vendor Personnel with such control
procedures, including obtaining advance approval from TXUED to the
extent
required.
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|
(d)
|
Use
of TXUED Facilities.
|
|
(i)
|
Unless
otherwise agreed by the Parties, Vendor shall not have the right
to use
the TXUED Facilities to provide services to third
parties.
|
|
(ii)
|
TXUED
reserves the right to relocate any TXUED Facility from which the
Services
are then being provided by Vendor to another facility or geographic
location upon one hundred twenty (120) days prior written notice
to
Vendor. TXUED shall be financially responsible for all additional
costs,
taxes or expenses related to or resulting from any TXUED initiated
relocation to a new or different service location, including any
reasonable costs or expenses directly incurred by Vendor as a result
of
such relocation. Vendor will not be deemed to be in breach of this
Agreement, including a breach of the Service Levels, to the extent
that
any such TXUED-initiated relocation prevents or delays Vendor Personnel
from performing Vendor’s obligations under this
Agreement.
|
|
(iii)
|
TXUED
also reserves the right to direct Vendor to cease using all or part
of the
space in any TXUED Facility upon one hundred twenty (120) days prior
written notice. In such event, TXUED shall be financially responsible
for
all additional costs, taxes or expenses related to or resulting from
any
such direction, including any reasonable direct costs and expenses
incurred by Vendor in leasing substitute space, provided that such
relocation is not contemplated by this Agreement. Vendor will not
be
deemed to be in breach of this Agreement, including a breach of the
Service Levels, to the extent that any such direction prevents or
delays
Vendor Personnel from performing Vendor’s obligations under this
Agreement.
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(e)
|
Conditions
for Return.
When the TXUED Facilities are no longer to be used by Vendor as
contemplated by this Section or are otherwise no longer being used
by
Vendor to perform the Services, Vendor shall provide ninety (90)
days’
prior notice to TXUED and at the end of such ninety (90) days shall
vacate
and return such TXUED Facilities (including any improvements to such
facilities made by or at the request of Vendor) to TXUED in substantially
the same condition as when such facilities were first provided to
Vendor,
subject to reasonable wear and tear.
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(f)
|
No
Violation of Laws.
Vendor shall (i) treat and use the TXUED Facilities in a reasonable
manner and (ii) not commit, and shall use all reasonable efforts to
ensure that no business visitor or invitee of Vendor commits, any
act in
violation of any Laws in such Vendor occupied TXUED Facility or any
act in
violation of TXUED’s insurance policies or in breach of TXUED’s
obligations under the applicable real estate leases in such Vendor
occupied TXUED Facilities (in each case, to the extent Vendor has
received
prior notice of such insurance policies or real estate
leases).
|
|
(g)
|
Costs
and Expenses.
Both Parties agree to use commercially reasonable efforts to minimize
the
costs and expenses associated with any relocation provided for in
this
Section 6.1.
|
|
6.2
|
Use
of Vendor Facilities.
|
|
(a)
|
Vendor
Facilities.
At TXUED’s request, Vendor shall provide TXUED with reasonable use of and
access to Vendor Facilities to the extent required by TXUED for purposes
relating to the Services and such other purposes as agreed by Vendor
(provided that such use shall not unreasonably interfere with Vendor’s
provision of the Services), including permitting TXUED to locate
such
numbers of TXUED Personnel as were historically located in any such
Vendor
Facilities that were acquired or leased from TXUED, less the number
of
Transitioned Employees historically located at such facility.
At
TXUED’s request, Vendor shall also permit TXUED to locate at such Vendor
Facilities any TXUED owned or leased equipment (including
SCADA/communication equipment) that was historically located in such
Vendor Facilities and shall permit TXUED Personnel to access, use,
maintain, replace and remove such equipment to the extent required
by
TXUED. Vendor warrants that Vendor shall not interfere with TXUED’s quiet
enjoyment of the Vendor Facilities. TXUED shall comply with Vendor’s
policies, rules and regulations applicable to Vendor’s Facilities
(including with respect to security, confidentiality and regulatory
issues) of which TXUED has been provided prior notice. Any improvements
or
modifications to Vendor Facilities requested by TXUED shall be
(i) subject to review and approval in advance by Vendor and
(ii) performed by or through Vendor. TXUED shall reimburse Vendor for
the actual direct reasonable costs and expenses incurred in connection
with such modifications or improvements. EXCEPT
AS SET FORTH HEREIN, THE
VENDOR FACILITIES ARE PROVIDED BY VENDOR TO TXUED ON AN AS-IS, WHERE-IS
BASIS. VENDOR EXPRESSLY DISCLAIMS ANY WARRANTIES, EXPRESS OR IMPLIED,
AS
TO THE VENDOR FACILITIES OR, EXCEPT AS SET FORTH HEREIN, QUIET ENJOYMENT
BY TXUED.
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(b)
|
Physical
Security.
Vendor is responsible for the physical security of the Vendor Facilities;
provided, that TXUED shall be responsible for the physical security
and
safety, physical access and control of the buildings or areas over
which
TXUED has exclusive control and TXUED shall not permit any person
to have
access to, or control of, any such area unless such access or control
is
permitted in accordance with control procedures approved by Vendor
or any
higher standard agreed to by TXUED and Vendor. TXUED shall be solely
responsible for compliance by TXUED Personnel with such control
procedures, including obtaining advance approval from Vendor to the
extent
required.
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|
(c)
|
Conditions
for Return.
When TXUED no longer requires the use of any Vendor Facilities, TXUED
shall provide ninety (90) days’ prior notice to Vendor and at the end of
such ninety (90) days shall vacate and return such Vendor Facilities
(including any improvements to such facilities made by or at the
request
of TXUED) to Vendor in substantially the same condition as when such
facilities were first provided to TXUED, subject to reasonable wear
and
tear.
|
|
(d)
|
No
Violation of Laws.
TXUED shall (i) treat and use the Vendor Facilities in a reasonable
manner and (ii) not commit, and shall use all reasonable efforts to
ensure that no business visitor or invitee of TXUED commits, any
act in
violation of any Laws in such TXUED occupied Vendor Facility or any
act in
violation of Vendor’s insurance policies or in breach of Vendor’s
obligations under the applicable real estate leases in such TXUED
occupied
Vendor Facilities (in each case, to the extent TXUED has received
prior
notice of such insurance policies or real estate
leases).
|
|
6.3
|
TXUED
Rules / Employee Safety.
|
|
(a)
|
TXUED
Rules and Compliance.
In performing the Services and using the TXUED Facilities, Vendor
shall
observe and comply with all lawful TXUED policies, rules and regulations
applicable to TXUED Facilities or the provision of the Services,
including
those set forth on Schedule E.3
to
the applicable Services Agreement as of the Master Agreement Effective
Date (collectively, “TXUED
Rules”);
provided that Vendor will not be deemed to be in breach of this Agreement
to the extent that any TXUED Rules prevent Vendor Personnel from
performing Vendor’s obligations under this Agreement. Vendor shall be
responsible for the promulgation and distribution of TXUED Rules
to Vendor
Personnel as and to the extent necessary and appropriate. Additions
or
modifications to the TXUED Rules will be communicated by TXUED to
Vendor
or Vendor Personnel prior to the effective date of such addition
or
modification. Vendor and Vendor Personnel shall observe and comply
with
such additional or modified TXUED Rules; provided that any Material
Change
resulting from additions or modifications to the TXUED Rules (whether
individually or in the aggregate with all prior additions or
modifications) since January 1, 2005 shall be addressed through the
Change
Control Process. Where applicable, in connection with Vendor’s
observing and complying with those TXUED Rules related to
TXUED’s obligation to comply with Affiliate Standards of Conduct
requirements under applicable Law, including those contained in
Public Utility Commission of Texas’ Substantive Rules 25.84, 25.272 and
25.273 (“Affiliate
Standards”),
Vendor shall develop and timely implement a plan approved by TXUED’s
Compliance Director, or other designee, to assist TXUED in complying
with the applicable Affiliate Standards. The plan will, at a
minimum, include the following elements: management oversight and
responsibility, procedures and rules, employee training and
communications, response to employee questions and concerns,
monitoring, auditing, evaluating compliance, enforcement and discipline,
response to alleged violations, complaints, requests for information
and
documentation of compliance efforts. The plan procedures
and rules shall, among other things, implement safeguards that:
protect the confidentiality of TXUED’s customer information,
including protecting against improper disclosure to TXUED’s
Affiliates; protect TXUED’s Proprietary Information from improper
disclosure to TXUED’s Affiliates; and ensure that all charges are
properly allocated among TXUED and TXUED’s Affiliates. Vendor
shall timely report to TXUED any alleged Affiliate Standards violation
and
shall cooperate in investigating and responding to an
alleged Affiliate Standards violation. TXUED may audit for
Vendor compliance consistent with Section
8.4.
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(b)
|
TXUED
Facility Safety and Health Compliance.
Vendor and Vendor Personnel shall familiarize themselves with the
premises
and operations at each TXUED Facility and TXUED Site and the TXUED
Rules
applicable to each such TXUED Facility and TXUED Site. Vendor and
Vendor
Personnel shall observe and comply with all Laws applicable to each
TXUED
Facility and TXUED Site or the provision of the Services, including
environmental Laws and Laws regarding occupational health and safety.
Vendor shall be responsible for the compliance of Resources and Services
with such Laws and shall be responsible for any acts or omissions
of
Vendor Personnel in contravention of such Laws. Notwithstanding the
foregoing, Vendor will not be responsible for compliance with Laws
by
TXUED or TXUED Personnel. Each Party shall take precautions to avoid
injury, property damage, spills or emissions of hazardous substances,
materials or waste and other dangers to persons, property or the
environment. To the extent required by TXUED as communicated to Vendor,
Vendor Personnel shall receive TXUED standard training prior to entering
certain TXUED Facilities and TXUED
Sites.
|
|
(c)
|
Vendor
Facility Safety and Health Compliance.
TXUED and TXUED Personnel shall familiarize themselves with the premises
and operations at each Vendor Facility and Vendor site and the Vendor
rules applicable to each such Vendor Facility and Vendor site. TXUED
and
TXUED Personnel shall observe and comply with all Laws applicable
to each
Vendor Facility and Vendor site or the provision of the Services,
including environmental Laws and Laws regarding occupational health
and
safety. TXUED shall be responsible for any acts or omissions of TXUED
Personnel in contravention of such Laws. Notwithstanding the foregoing,
TXUED will not be responsible for compliance with Laws by Vendor
or Vendor
Personnel. Each Party shall take precautions to avoid injury, property
damage, spills or emissions of hazardous substances, materials or
waste
and other dangers to persons, property or the environment. To the
extent
required by Vendor as communicated to TXUED, TXUED Personnel shall
receive
Vendor standard training prior to entering certain Vendor Facilities
and
Vendor sites.
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6.4
|
Notice
of Defaults.
Each Party shall promptly inform the other Party in writing of any
material breach of, or misuse or fraud in connection with, any Third
Party
Contract (including any equipment lease) used in connection with
the
Services of which it becomes aware and shall cooperate with the other
Party to prevent or stay any such breach, misuse or
fraud.
|
|
7.
|
SERVICE
LEVELS
|
|
7.1
|
General.
Vendor shall perform the Services so as to meet or exceed the applicable
Service Levels. Vendor shall perform the Services in accordance with
this
Agreement (including the Service Levels) and with promptness and
diligence, and in a professional and workmanlike
manner.
|
|
7.2
|
Service
Level Credits.
Vendor recognizes that TXUED is paying Vendor to deliver the Services
at
specified Service Levels. If Vendor fails to meet such Service Levels,
then Vendor shall pay or credit, in accordance with Schedule
G
to
the applicable Services Agreement, to TXUED the performance credits
specified in Schedule
G
to
the applicable Services Agreement (“Service
Level Credits”)
in recognition of the diminished value of the Services resulting
from
Vendor’s failure to meet the agreed upon level of performance, and not as
a penalty. Under no circumstances shall the imposition of Service
Level
Credits be construed as TXUED’s sole or exclusive remedy for any failure
to meet the Service Levels; provided,
however, that any Service Level Credits received by TXUED shall be
offset
against the amount of damages (if any) received by TXUED from Vendor
as a
result of the underlying event giving rise to the Service Level Credit.
For the avoidance of doubt, Vendor’s failure to perform any Services so as
to meet or exceed their applicable Service Levels shall not in and
of
itself constitute an inference of Vendor’s material breach of this
Agreement unless otherwise provided under applicable
Law.
|
|
7.3
|
Problem
Analysis.
If Vendor fails in any material respect, or numerous immaterial respects
which collectively are material, to provide Services in accordance
with
this Agreement and such failure has a material adverse impact on
the
business or operations of TXUED as reasonably determined by TXUED
consistent with TXUED’s historical practices, then upon TXUED’s request
Vendor shall (after restoring Service or otherwise resolving any
immediate
problem) (i) promptly investigate and report on the causes of the
problem, (ii) provide a Root Cause Analysis of such failure as soon
as practicable at a level of detail commensurate with the impact
of such
failure taking into account the impact of the failure and consistent
with
TXUED’s historical practices, (iii) implement remedial action and
begin complying with this Agreement as soon as practicable,
(iv) advise TXUED of the status of remedial efforts being undertaken
with respect to such problem, and (v) provide TXUED reasonable
evidence that the causes of such problem have been or will be corrected.
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7.4
|
Continuous
Improvement Reviews.
The Parties agree to implement the continuous improvement method
set forth
in Schedule
G
to
each Services Agreement.
|
|
7.5
|
Measurement
and Monitoring.
On or before the applicable Services Agreement Commencement Date
or, if
relevant data is not currently tracked by TXUED, as soon as reasonably
practicable thereafter and in any event within one hundred twenty
(120)
days after the applicable Services Agreement Effective Date (or,
if
earlier, prior to the date Vendor is required to meet the applicable
Service Level as specified in Schedule
G
to
the applicable Services Agreement), Vendor shall implement measurement
and
monitoring tools and metrics, as well as standard reporting procedures
in
accordance with Section 8.2,
all as approved by TXUED, to measure Vendor’s performance of the Services
against the applicable Service Levels and provide TXUED with reports
in a
format and at a level of detail sufficient to enable TXUED to easily
track
and verify Vendor’s compliance with the Service Levels. Vendor shall make
such Service Level reports and Service Level data available to TXUED,
as
well as problem management data and other data regarding the status
of
service problems, service requests and user inquiries, using performance
“dashboard” Applications or other Software providing the same or
substantially similar
functionality.
|
|
7.6
|
Notice
of Adverse Impact.
If Vendor becomes aware of any failure by Vendor that could reasonably
be
expected to have a material adverse effect on the Services, then
Vendor
shall promptly inform TXUED in writing of such situation and the
impact or
expected impact. Vendor shall as soon as practicable meet with TXUED
to
formulate an action plan to minimize or eliminate the impact of such
situation.
|
|
7.7
|
Key
Vendor Personnel.
|
|
(a)
|
Approval
of Key Vendor Personnel.
|
|
(i)
|
Before
assigning an individual to act as one of the Key Vendor Personnel,
other
than those listed on Schedule
C
to
the applicable Services Agreement, whether as an initial assignment
or a
subsequent assignment, Vendor shall (1) notify TXUED of the proposed
assignment, (2) introduce the individual to appropriate TXUED
representatives, (3) provide reasonable opportunity for TXUED
representatives to interview the individual and (4) provide TXUED
with a résumé and such other information about the individual as TXUED may
reasonably request and as permitted by applicable Law and Vendor’s
internal policies consistently applied. Within five (5) days of its
receipt of the information described in the immediately preceding
sentence, TXUED will notify Vendor as to whether it has any objection
to
the proposed assignment (and any failure of TXUED to provide such
notice
in the time required will be deemed by TXUED to be an acceptance
of such
proposed assignment). If TXUED in good faith reasonably and lawfully
objects to the proposed assignment, the Parties shall attempt to
resolve
TXUED’s concerns on a mutually agreeable basis. If the Parties have not
been able to resolve TXUED’s concerns within five (5) days of TXUED
communicating its concerns, Vendor shall not assign the individual
to that
position and shall propose to TXUED the assignment of another individual
of suitable ability and
qualifications.
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(ii)
|
With
regard to each Services Agreement, within thirty (30) days after
the
applicable Services Agreement Effective Date, Vendor shall identify
and
obtain TXUED’s approval of all Key Vendor Personnel.
|
|
(iii)
|
TXUED
may change the positions designated as Key Vendor Personnel with
Vendor’s
approval, which shall not be unreasonably withheld; provided that
TXUED
shall be financially responsible for all additional costs, taxes
or
expenses related to or resulting from any such TXUED requested change.
|
|
(iv)
|
Except
as otherwise agreed by the TXUED Account Executive and the Vendor
Account
Executive, TXUED may identify up to five (5) positions within Vendor’s
organization as Key Vendor Personnel positions on Schedule
C
to
the applicable Services Agreement and identify the Vendor Personnel
that
shall fill each such position; provided that TXUED may not identify
the
chief executive officer of Vendor or any of his or her direct reports
as
Key Vendor Personnel or Key Vendor Personnel
positions.
|
|
(b)
|
Continuity
of Key Vendor Personnel.
Subject to the remainder of this Subsection (b), Vendor shall cause
each
of the Key Vendor Personnel to devote full time and effort to the
provision of Services for the period specified in Schedule C
to
the applicable Services Agreement from the date he or she assumes
the
position in question. Vendor shall not transfer, reassign or remove
any
Key Vendor Personnel (except as a result of voluntary resignation,
involuntary termination for cause, illness, disability or death)
or
announce its intention to do so during the specified period, subject
to
the following procedures. If Vendor proposes to reassign any Key
Vendor
Personnel, Vendor shall (i) notify TXUED of the proposed
reassignment, (ii) introduce the proposed replacement to appropriate
TXUED representatives, (iii) provide reasonable opportunity for TXUED
representatives to interview the proposed replacement and
(iv) provide TXUED with a résumé and such other information about the
proposed replacement as TXUED may reasonably request and as permitted
by
applicable Law and Vendor’s internal policies consistently applied. Within
five (5) days of its receipt of the information described in the
immediately preceding sentence, TXUED will notify Vendor as to whether
it
has any objection to the proposed reassignment and replacement (and
any
failure of TXUED to provide such notice in the time required will
be
deemed by TXUED to be an acceptance of such proposed reassignment
and
replacement). If TXUED in good faith reasonably and lawfully objects
to
the proposed reassignment and replacement, Vendor shall not assign
the
proposed replacement to that position and shall propose to TXUED
the
assignment of another individual of suitable ability and qualifications.
In the event of the voluntary resignation, involuntary termination
for
cause, illness, disability or death of any Key Vendor Personnel during
or
after the specified period, Vendor shall (i) give TXUED as much
notice as reasonably practicable of such development and
(ii) identify and obtain TXUED’s approval of a suitable replacement
as soon as is reasonably practicable in accordance with Section 7.7(a)(i).
In addition, even after the specified period, Vendor shall transfer,
reassign or remove Key Vendor Personnel (other than in the case of
voluntary resignation, involuntary termination for cause, illness,
disability, or death) only after (i) giving TXUED at least forty-five
(45) days’ prior notice of such action and (ii) identifying and
obtaining TXUED’s approval of a suitable replacement at least
thirty (30) days prior to such transfer, reassignment or removal in
accordance with Section 7.7(a)(i).
Notwithstanding the foregoing, upon Vendor’s request and in connection
with Vendor’s provision of services to clients other than TXUED, TXUED
shall allow Vendor to use agreed upon Key Vendor Personnel in connection
with the provision of services to other
clients.
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(c)
|
Retention
and Succession.
Vendor shall provide to TXUED, for its review and comment, a retention
strategy designed to retain Key Vendor Personnel on the TXUED account
for
the period specified in Schedule
C
to
the applicable Services Agreement. Vendor shall also maintain active
succession plans for each of the Key Vendor Personnel positions.
Vendor
shall implement such retention strategies to retain Key Vendor Personnel
as Vendor deems appropriate. Upon termination or resignation of any
Key
Vendor Personnel, Vendor shall provide notice to TXUED of such termination
and expeditiously identify and obtain TXUED’s approval of a suitable
replacement in accordance with Section 7.7(a)(i).
|
|
(d)
|
Evaluation
Input.
TXUED shall have an opportunity to conduct an annual review of the
Vendor
Account Executive and each of the other Key Vendor Personnel and
an
opportunity to provide meaningful information to Vendor with respect
to
TXUED’s evaluation of the performance of the Vendor Account Executive and
the other Key Vendor Personnel and such evaluation shall be considered
by
Vendor in establishing the total compensation of such
individuals.
|
|
7.8
|
Vendor
Account Executive.
Vendor shall designate a “Vendor
Account Executive”
for this TXUED engagement who, unless otherwise agreed by TXUED,
shall
maintain his or her office at 000 X. Xxxxx Xxxxxx, Xxxxxx, Xxxxx
00000 (in
a location therein determined by TXUED). The Vendor Account Executive
shall (i) be one of the Key Vendor Personnel, (ii) be a full
time employee of Vendor, (iii) devote his or her full time and effort
to managing and coordinating Vendor’s performance under this Agreement,
(iv) remain in this position for a minimum period of two (2) years
from the initial assignment (except as a result of voluntary resignation,
involuntary termination for cause, illness, disability, or death)
and
(v) have authority to act on behalf of Vendor in all day-to-day
matters pertaining to this Agreement. Additionally, (i) Vendor shall
be entitled to designate additional representatives who will be authorized
to make certain decisions (e.g., regarding emergency maintenance)
if the
Vendor Account Executive is not available and (ii) the Vendor Account
Executive shall be entitled to delegate any of his or her rights
and
obligations to one or more designees upon prior notice to TXUED.
TXUED is
entitled to rely upon instructions given by the Vendor Account Executive
or any other individual designated to have decision-making authority
in
accordance with this Section.
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7.9
|
Vendor
Personnel Are Not TXUED Employees; Independent
Relationship.
Except as otherwise expressly set forth in this Agreement, the Parties
intend hereunder to create an independent contractor relationship
and
nothing in this Agreement shall operate or be construed as making
TXUED
and Vendor partners, joint venturers, principals, joint employers,
agents
or employees of or with the other. No officer, director, employee,
agent,
Affiliate, contractor or subcontractor retained by Vendor to perform
work
on TXUED’s behalf hereunder shall be deemed to be an officer, director,
employee, agent, Affiliate, contractor or subcontractor of TXUED
for any
purpose. Vendor, not TXUED, has the sole right, power, authority
and duty
to (i) supervise, manage and direct the activities of the Vendor
Personnel and to compensate such Vendor Personnel for any work performed
by them on behalf of TXUED pursuant to this Agreement and
(ii) contract, direct, procure, perform or cause to be performed all
work to be performed by Vendor under this Agreement. Vendor, and
not
TXUED, shall be responsible for all acts and omissions of Vendor
Personnel
(unless such acts or omissions were at the direction of TXUED to
Vendor).
|
|
7.10
|
Replacement,
Qualifications, and Retention of Vendor Personnel.
|
|
(a)
|
Requested
Replacement.
In the event that TXUED determines lawfully and in good faith that
any
individual Vendor Personnel (including Key Vendor Personnel) has
violated
any TXUED Rule or TXUED Standard or any Law, then TXUED shall give
Vendor
notice to that effect requesting that such Vendor Personnel be replaced
and Vendor shall immediately suspend such individual’s performance of the
Services and access to TXUED Facilities pending completion of the
process
set forth in this Section 7.10(a).
Vendor shall have five (5) days following such notice in which to
investigate the matters forming the basis of such request, correct
any
deficient performance and provide TXUED with assurances that such
deficient performance shall not recur. If, following such five (5)
day
period, TXUED is not reasonably satisfied with the results of Vendor’s
efforts to correct the deficient performance and/or to ensure its
non-recurrence, Vendor shall, as soon as reasonably practicable,
remove
and replace such Vendor Personnel with an individual of suitable
ability
and qualifications. Nothing in this provision shall operate or be
construed to limit Vendor’s responsibility for the acts or omission of the
Vendor Personnel.
|
|
(b)
|
Turnover
Rate and Data.
Vendor shall notify TXUED at least thirty (30) days prior to any
planned
reduction in force (including layoffs and mass terminations) and
such
notice shall include the number of employees to be severed and the
classification and work location of each such employee. Commencing
on the
three (3) month anniversary of the applicable Services Agreement
Commencement Date and every three (3) months thereafter, Vendor shall
report the turnover rate of Vendor Personnel (i.e., the voluntary
or
involuntary cessation of employment with Vendor that is not part
of any
previously planned reduction in force) (“Turnover
Rate”).
If TXUED reasonably determines that the Turnover Rate of Vendor Personnel
is materially adversely impacting the Services and so notifies Vendor,
Vendor shall, within five (5) days of the date of TXUED’s notice,
(i) provide TXUED with data concerning Vendor’s Turnover Rate,
(ii) provide TXUED with an accounting of the Vendor Personnel then
providing the Services at such level of detail as requested by TXUED
(including indicating the length of time each of the Vendor Personnel
has
been performing the Services), (iii) meet with TXUED to discuss the
reasons for the Turnover Rate and (iv) submit a proposal for reducing
the Turnover Rate. After considering TXUED's comments, to the extent
appropriate Vendor shall implement such proposal as soon as
practicable.
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7.11
|
Conduct
of Vendor Personnel.
While at TXUED Facilities, Vendor Personnel shall (i) comply with the
TXUED Rules as long as TXUED notifies Vendor of such TXUED Rules
reasonably in advance (subject to Section
6.3(a)),
(ii) comply with requests of TXUED personnel pertaining to personal
and professional conduct, (iii) attend standard workplace training
offered by TXUED at TXUED’s request, and (iv) otherwise conduct
themselves in a professional and businesslike
manner.
|
|
7.12
|
Substance
Abuse.
Vendor represents and warrants that it has and shall maintain and
enforce
substance abuse policies, in each case in conformance with applicable
Laws, and Vendor Personnel shall be subject to such
policies.
|
|
8.
|
VENDOR
RESPONSIBILITIES
|
|
8.1
|
Policy
and Procedures Manual.
Vendor shall deliver to TXUED for its review, comment and approval
a
Policy and Procedures Manual as described in the applicable Services
Agreement.
|
|
8.2
|
Reports.
|
|
(a)
|
General.
Vendor shall provide TXUED with reports pertaining to the performance
of
the Services (“Reports”)
as set forth in Schedule
E
or
Schedule R
to
the applicable Services Agreement, in the format and at the frequencies
provided therein. In addition, TXUED may request, and Vendor will
generate
and deliver, additional Reports at the cost and expense of TXUED.
All
Reports described in Schedule
E
or
Schedule
R
to
the applicable Services Agreement shall be provided to TXUED as part
of
the Services. The Reports described in Schedule
E
or
Schedule R
to
the applicable Services Agreement and, to the extent mutually agreed
upon,
all other Reports, shall be provided to TXUED in hard copies or electronic
copies, as designated by TXUED.
|
|
(b)
|
Back-Up
Documentation.
Vendor shall provide TXUED with copies of and access to data,
documentation and other information in Vendor’s possession as may be
reasonably requested by TXUED in order to verify the accuracy of
the
Reports provided by Vendor.
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(c)
|
Correction
of Errors.
Vendor shall promptly correct all errors or inaccuracies in or with
respect to the Reports of which it becomes aware, including the
information or data contained in such Reports; provided that errors
or
inaccuracies for which TXUED is responsible shall be corrected by
Vendor
at TXUED’s expense.
|
|
8.3
|
Reserved.
|
|
8.4
|
Audit
Rights.
|
|
(a)
|
Vendor
Records.
Vendor shall maintain complete and accurate records of and supporting
documentation related to the Services, including for all Charges
(“Contract
Records”).
Vendor shall maintain such Contract Records in accordance with generally
accepted accounting principles for the applicable jurisdiction applied
on
a consistent basis and in accordance with Exhibit
12.
Any Material Change resulting from additions or modifications to
Exhibit
12
shall be addressed through the Change Control
Process.
|
|
(b)
|
Operational
Audits. Vendor
shall provide to
TXUED (and internal and external auditors, inspectors, governmental
bodies, regulators and other representatives that TXUED may designate)
access at reasonable hours to Vendor Personnel, to the facilities
at or
from which Services are or have been provided, to
Contract Records and other pertinent information, all to the extent
related to the performance of the Services and Vendor’s obligations under
this Agreement. Such access shall be provided for the purpose of
performing audits and inspections of TXUED and its businesses, including
to (i) verify the integrity of TXUED Data, (ii) examine the
Systems that process, store, support and transmit that data,
(iii) examine controls (e.g., organizational controls, input/output
controls, System modification controls, processing controls, System
design
controls and access controls) and security, disaster recovery and
back-up
practices and procedures, (iv) examine Vendor’s performance of the
Services, (v) verify Vendor’s reported performance against this
Agreement (including the applicable Service Levels), (vi) examine
Vendor’s measurement, monitoring, management and reporting tools and
(vii) enable TXUED to meet applicable legal, regulatory and
contractual requirements and installing and operating Software that
assists TXUED (and TXUED’s internal and external auditors, inspectors,
governmental bodies, regulators and other representatives) in performing
its audit, in each case to the extent affected by or applicable to
the
Services. Vendor shall provide any assistance reasonably requested
by
TXUED or its designee(s) in conducting any such audit, including
providing
electronic access to TXUED Data and Vendor’s data that directly pertains
to the Services and Vendor’s obligations under this Agreement. If an audit
reveals a material breach of this Agreement, Vendor shall promptly
reimburse TXUED for the actual cost of such
audit.
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(c)
|
Financial
Audits.
During the Term and for a period thereafter required by Law, Vendor
shall
provide to TXUED (and internal and external auditors, inspectors,
governmental bodies, regulators and other representatives that TXUED
may
designate) access at reasonable hours to Vendor Personnel and to
Contract
Records required to be maintained by TXUED by Law and other pertinent
information, all to the extent related to the performance of, and
the
Charges for, the Services and Vendor’s obligations under this Agreement.
Such access shall be provided for the purpose of performing audits
and
inspections to (i) verify the accuracy and completeness of Contract
Records, (ii) verify the accuracy and completeness of Charges and any
Pass-Through Expenses and Out-of-Pocket Expenses and (iii) enable
TXUED to meet applicable legal, regulatory and contractual requirements,
in each case to the extent affected by or applicable to the Services
and/or the Charges for such Services. Vendor shall provide any assistance
reasonably requested by TXUED or its designee(s) in conducting any
such
audit. If any such audit reveals a net overcharge by Vendor, and
Vendor
does not successfully dispute the amount questioned by such audit
in
accordance with Article 17,
Vendor shall promptly pay to TXUED the amount of such overcharge,
together
with interest from the date of Vendor’s receipt of such overcharge at the
then current rate set by Citibank, N.A. as its prime lending rate
plus two
(2) percent per annum. In addition, if any such audit reveals an
overcharge of more than the greater of (x) five percent (5%) and
(y) one
million dollars ($1,000,000), in each case of the audited Charges
in any
Charges category, Vendor shall promptly reimburse TXUED for the actual
cost of such audit.
|
|
(d)
|
Audit
Assistance.
TXUED may be subject to regulation and audit by governmental bodies,
standards organizations, other regulatory authorities, customers
or other
parties to contracts with TXUED under applicable Laws, rules, regulations,
standards and contract provisions. If a governmental body, standards
organizations, other regulatory authority or customer or other party
to a
contract with TXUED exercises its right to examine or audit TXUED
pursuant
to such Laws, rules, regulations, standards or contract provisions,
Vendor
shall provide reasonable assistance requested by TXUED in responding
to
such audits or requests for
information.
|
|
(e)
|
General
Procedures.
|
|
(i)
|
Except
as otherwise required under applicable Law, TXUED may perform audits
and
inspections in accordance with this Section upon reasonable notice
to
Vendor during normal business hours, for a reasonable duration. Subject
to
the limitations contained elsewhere in this Section
8.4,
TXUED may perform audits on each of the various subject areas described
in
the TXUED audit plan then in-effect at the time of such audit (each,
an
“Audit
Area”),
provided that an Audit Area may not be audited more than once during
any
twelve (12) month period, unless more frequent audits are required
by any
Laws applicable to TXUED. TXUED has the right to amend any such audit
plan
at any time, provided that such amended audit plan must be provided
to
Vendor and all previously audited Audit Areas will remain subject
to the
foregoing limitation on the number of audits per twelve (12) month
period.
Notwithstanding the foregoing, if, as a result of such an audit,
the
Parties mutually agree that Vendor should implement material new,
additional or stronger controls, or if such audit reveals a material
failure of compliance with this Agreement then TXUED shall be entitled
to
conduct a follow-up audit within six (6) months. The costs and expenses
to
perform audits under this Section shall be borne by TXUED. Vendor
will
assist TXUED, when necessary, in TXUED’s performance of any audit pursuant
to this Section
8.4
as
part of Vendor’s normal course of business and at no additional charge to
TXUED. Notwithstanding the remaining provisions of this clause (i),
TXUED
may perform any number of inspections of (A) Vendor’s means and methods of
performing Services in the field and (B) any Contract Records that
are
reasonably related to such
Services.
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(ii)
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Notwithstanding
the intended breadth of TXUED’s audit rights, TXUED shall not be given
access to (A) the proprietary information of other Vendor customers
or
Vendor not related to the provision of the Services, (B) Vendor
locations that are not related to TXUED or the Services, (C) Vendor’s
internal costs, except to the extent such costs are the basis upon
which
TXUED is charged and/or are necessary to calculate the applicable
Charges
or (D) any information and data that constitutes attorney work
product or privileged information. Reviews of costs to which access
is
permitted in (C) may include access to timekeeping systems, amounts
charged Vendor by Subcontractors and applicable payroll reviews as
it
relates to work performed by Vendor on a Variable Pricing basis as
set
forth in Exhibit 11.
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|
(iii)
|
In
performing audits, TXUED shall use all reasonable efforts to avoid
unnecessary disruption of Vendor’s operations and unnecessary interference
with Vendor’s ability to perform the
Services.
|
|
(iv)
|
Following
any audit, TXUED shall conduct (in the case of an internal audit),
or
request its external auditors or examiners to conduct, an exit conference
with Vendor to obtain factual concurrence with issues identified
in the
review.
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(v)
|
TXUED
(and internal and external auditors, inspectors, governmental bodies,
regulators and other representatives that TXUED may designate) shall
be
given a reasonably secure workspace in which to perform an audit,
plus
reasonable access to photocopiers, telephones, facsimile machines,
computer hook-ups, and any other facilities or equipment needed for
the
performance of the audit.
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(f)
|
Vendor
Internal Audit.
If Vendor determines as a result of its own internal audit that it
has
overcharged TXUED, then Vendor shall promptly pay to TXUED the amount
of
such overcharge, together with interest from the date of Vendor’s receipt
of such overcharge at the rate of two (2) percent per
annum.
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(g)
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Vendor
Response.
Vendor and TXUED shall meet to review each audit report promptly
after the
issuance thereof. Vendor will respond to each audit report in writing
within sixty (60) days from receipt of such report. Vendor and TXUED
shall
develop and agree upon an action plan to promptly address and resolve
any
reasonable identified deficiencies, concerns and/or recommendations
in
such audit report and, following approval of such plan by TXUED,
Vendor
shall undertake remedial action in accordance with such action plan
and
the dates specified therein.
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|
(h)
|
Vendor
Response to Non-TXUED Audits. If
an audit by a governmental body, standards organization or regulatory
authority having jurisdiction over TXUED or Vendor results in a finding
that Vendor is not in compliance with any generally accepted accounting
principle or other audit requirement or any Law or standard relating
to
the performance of its obligations under this Agreement, Vendor shall,
at
its own expense and within the time period specified by such auditor,
address and resolve the deficiency(ies) identified by such governmental
body, standards organization or regulatory
authority.
|
|
(i)
|
SAS
70 Audit.
Vendor shall conduct an audit on controls placed in operation and
tests of
operating effectiveness in accordance with the American Institute
of
Certified Public Accountants Statement on Auditing Standards (SAS)
70 (SAS
70 Type 2 report, not Type 1 report), or an equivalent audit as agreed
by
the Parties (the “SAS
70 Audit”),
with respect to all Vendor Facilities at or from which the Services
are
provided. The SAS 70 Audit shall be conducted by an independent auditor
of
national recognition and standing. Such SAS 70 Audit shall be conducted
annually or, if provided by Law, less frequently as may be commercially
reasonable. Vendor shall permit TXUED to participate in the planning
of
each such SAS 70 Audit, shall confer with TXUED as to the scope,
timing of
and manner that each such SAS 70 Audit shall be conducted and audit
findings documented and shall accommodate TXUED’s requirements and
concerns to the extent practicable. Except to the extent otherwise
expressly agreed to by TXUED, Vendor shall arrange for the completion
of
each SAS 70 Audit such that (a) the resulting SAS 70 Audit report
(the
“SAS
70 Report”)
is completed and provided to TXUED and, if so requested by TXUED,
its
independent auditors, at least within sixty (60) days following the
“as
of” date but in no event less than sixty (60) days prior to the end of
TXUED’s fiscal year end, (b) the SAS 70 Report covers at least a one
hundred eighty (180) day period and (c) the “as of” date is no more than
six (6) months prior to TXUED’s fiscal year end. Vendor shall respond to
such SAS 70 Report in accordance with Section
8.4(g).
Vendor shall be obligated to provide a SAS 70 Report applicable to
any
fiscal year of TXUED during which this Agreement expires or is terminated;
provided, however, that such SAS 70 Report need only cover that portion
of
such fiscal year preceding expiration or termination of this Agreement.
TXUED shall reimburse Vendor for the reasonable actual incremental
internal costs, and amounts that Vendor pays its independent auditor,
in
order to conduct any SAS 70 Audit pursuant to this
Subsection.
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8.5
|
Agency
and Disbursements.
|
|
(a)
|
Limited
Agency.
TXUED hereby appoints Vendor as its limited agent during the Term
solely
for the purposes of managing and administering the Managed Third
Party
Agreements. TXUED shall provide, on a timely basis, such affirmation
of
Vendor’s authority to such lessors, licensors, suppliers and other third
parties as Vendor may reasonably
request.
|
|
(b)
|
Reimbursement
for Substitute Payment.
If either Party in error pays to a third party an amount for which
the
other Party is responsible under this Agreement, the Party that is
responsible for such payment shall promptly reimburse the paying
Party for
such amount.
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|
(c)
|
Notice
of Decommissioning.
Vendor agrees to notify TXUED promptly if and to the extent any TXUED
owned equipment or TXUED leased equipment will no longer be used
to
provide the Services. The notification will include the identification
of
such equipment and the date it will no longer be needed by Vendor,
along
with the reason for decommissioning. Upon receipt of any such notice,
TXUED may, in its sole discretion, terminate the equipment lease
for such
leased equipment as of the date specified in such notice and sell
or
otherwise dispose of or redeploy such TXUED owned equipment as of
the date
specified in such notice. Upon Vendor ceasing to use any such equipment
(or, in the case of leased equipment, upon the last day TXUED is
obligated
to make such leased equipment available to Vendor, if earlier), Vendor
shall return the same to TXUED and/or its designee(s) in condition
at
least as good as the condition thereof on the applicable Services
Agreement Commencement Date, ordinary wear and tear excepted, provided
that such equipment was under the control of
Vendor.
|
|
8.6
|
Subcontractors.
|
|
(a)
|
Use
of Subcontractors.
Except to the extent set forth in subclauses (i) through (iv) of
this
Subsection, Vendor shall not subcontract any of its responsibilities
without TXUED’s prior approval. TXUED agrees that Vendor may subcontract
in the following instances without TXUED’s approval: (i) to the
Subcontractors listed on Schedule
D
to
the applicable Services Agreement (which Schedule the Parties acknowledge
may be updated from time to time upon the agreement of the Parties);
(ii)
for any services that are in support of Vendor’s provision of the Services
(e.g., janitorial services or catering services) from a service location;
(iii) subcontracts pursuant to which Vendor intends to pay to the
Subcontractor less than one hundred thousand dollars ($100,000) during
any
Contract Year; or (iv) any Entity that is a wholly-owned subsidiary
of
Vendor (any of the foregoing, a “Permitted
Subcontract”).
If, however, TXUED expresses dissatisfaction with the services of
a
Permitted Subcontractor, Vendor shall work in good faith to resolve
TXUED’s concerns on a mutually acceptable basis. Prior to entering into
a
subcontract (other than a Permitted Subcontract) with any person
or Entity
to provide or perform any part of the Services, Vendor shall (y) give
TXUED reasonable prior notice specifying the components of the Services
affected, the scope of the proposed subcontract, the identity and
qualifications of the proposed Subcontractor, and the reasons for
subcontracting the work in question and (z) obtain TXUED’s prior
approval of such Subcontractor.
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(b)
|
Shared
Subcontractors.
Notwithstanding Section 8.6(a),
Vendor may, in the ordinary course of business, subcontract with
temporary
personnel firms for the provision of temporary contract labor
(collectively, “Shared
Subcontractors”);
provided, that such Shared Subcontractors possess the training and
experience, competence and skill to perform the work in a skilled
and
professional and workmanlike manner. TXUED shall have no approval
right
with respect to such Shared Subcontractors. If, however, TXUED expresses
dissatisfaction with the services of a Shared Subcontractor, Vendor
shall
work in good faith to resolve TXUED’s concerns on a mutually acceptable
basis.
|
|
(c)
|
Vendor
Responsibility.
For purposes of this Agreement, (i) services, functions and
responsibilities performed or provided by Subcontractors (including
their
personnel) shall be deemed Services performed and provided by Vendor,
(ii) references to Vendor shall include such Subcontractors
(including for purposes of compliance with operations, policies,
procedures, rules, standards and the like of TXUED and the indemnities
under this Agreement), (iii) Vendor shall be responsible for any
failure by any Subcontractor to perform in accordance with this Agreement
or to comply with any duties or obligations imposed on Vendor under
this
Agreement (including the Service Levels) to the same extent as if
such
failure to perform or comply was committed by Vendor or Vendor employees
and (iv) Vendor shall be responsible for the performance of all
Subcontractors providing any of the Services. Vendor shall be TXUED’s sole
point of contact regarding the
Services.
|
|
(d)
|
Audit
Rights.
Vendor shall obtain from all Subcontractors that are Affiliates of
Vendor,
and shall use commercially reasonable efforts to obtain from all
other
Subcontractors, sufficient rights to enable TXUED to exercise TXUED’s
audit rights under Section
8.4
in
respect of each Subcontractor.
|
|
8.7
|
Requirement
of Writing.
To the extent TXUED is required under this Agreement to obtain Vendor’s
approval, consent or agreement, such approval, consent or agreement
must
be in writing and must be signed by or directly transmitted by electronic
mail from the Vendor Account Executive or by the applicable individual
to
whom authority has been delegated in accordance with Section
7.8.
Notwithstanding the preceding sentence, the Vendor Account Executive
may
agree in advance in writing that as to certain specific matters,
oral
approval, consent or agreement will be
sufficient.
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8.8
|
Seconded
TXUED Personnel.
In order to (a) facilitate an effective relationship between the
Parties,
(b) provide for training and development of TXUED Personnel (including
allowing TXUED Personnel to refresh skills that may relate to work
performed by TXUED, Vendor or TXUED Third Party Contractors), (c)
assist
Vendor with Vendor’s performance of, and to perform, the Services and (d)
perform such other services, functions and responsibilities as the
Parties
may mutually agree, TXUED may periodically second TXUED Personnel
to
Vendor (the “Seconded
TXUED Personnel”),
provided that the secondment of any TXUED Personnel does not unreasonably
interfere with Vendor’s performance of the Services. Vendor shall not have
any authority to hire, fire, impose discipline or otherwise to take
personnel-related actions with respect to the Seconded TXUED Personnel.
The Parties agree that no employer and employee relationship is to
be
created between Vendor and the Seconded TXUED Personnel, and further
that
no employee benefits available to employees of Vendor shall accrue
to the
Seconded TXUED Personnel. Vendor will provide TXUED management personnel
with direction regarding the activities of the Seconded TXUED Personnel
in
accordance with TXUED’s requirements and in consultation with the TXUED
Account Executive or his/her designee. With respect to the Seconded
TXUED
Personnel, Vendor shall not be responsible for implementing and
administering TXUED human resources policies, practices or procedures,
including those addressing hiring, compensation, promotions, transfers,
terminations, employment related complaints general career development
and
performance management. TXUED shall continue to be financially responsible
for the compensation and employee benefits of the Seconded TXUED
Personnel
(collectively, “Employment
Costs”),
provided that prior to any Seconded TXUED Personnel assisting Vendor
with
Vendor’s performance of, or performing, any services, functions or
responsibilities (including the Services) that benefit Vendor, the
Parties
shall agree on the amount of Employment Costs for which Vendor shall
reimburse TXUED with respect to such Seconded TXUED
Personnel.
|
|
8.9
|
Seconded
Vendor Personnel.
In order to (a) facilitate an effective relationship between the
Parties,
(b) provide for training and development of Vendor employees, (c)
assist
TXUED with TXUED’s performance of, and to perform, TXUED’s Retained
Resources and Business Processes (as such term is defined in the
Field
Services Agreement) and (d) perform such other services, functions
and
responsibilities as the Parties may mutually agree, Vendor may
periodically second Vendor employees to TXUED (the “Seconded
Vendor Personnel”),
provided that the secondment of any Vendor employees does not unreasonably
interfere with TXUED’s business operations. TXUED shall not have any
authority to hire, fire, impose discipline or otherwise to take
personnel-related actions with respect to the Seconded Vendor Personnel.
The Parties agree that no employer and employee relationship is to
be
created between TXUED and the Seconded Vendor Personnel, and further
that
no employee benefits available to employees of TXUED shall accrue
to the
Seconded Vendor Personnel. With respect to the Seconded Vendor Personnel,
TXUED shall not be responsible for implementing and administering
Vendor
human resources policies, practices or procedures, including those
addressing hiring, compensation, promotions, transfers, terminations,
employment related complaints, or general career development and
performance management. Vendor shall continue to be financially
responsible for the compensation and employee benefits of the Seconded
Vendor Personnel.
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9.
|
TXUED
RESPONSIBILITIES
|
|
9.1
|
Responsibilities.
In addition to TXUED’s responsibilities expressly set forth elsewhere in
this Agreement, TXUED shall be responsible for the
following:
|
|
(a)
|
TXUED
Account Executive.
TXUED shall designate one (1) individual to whom all Vendor communications
concerning this Agreement shall be addressed (the “TXUED
Account Executive”),
who shall have the authority to act on behalf of TXUED in all day-to-day
matters pertaining to this Agreement. TXUED may change the designated
TXUED Account Executive by providing notice to Vendor. Additionally,
(i) TXUED shall be entitled to designate additional representatives
who will be authorized to make certain decisions (e.g., regarding
emergency maintenance) if the TXUED Account Executive is not available
and
(ii) the TXUED Account Executive shall be entitled to delegate any of
his or her rights and obligations to one or more designees upon prior
notice to Vendor. Vendor is entitled to rely upon instructions given
by
the TXUED Account Executive or any other individual designated to
have
decision-making authority in accordance with this Section
9.1(a).
|
|
(b)
|
Cooperation.
TXUED shall cooperate with Vendor by, among other things, making
available, as reasonably requested by Vendor and as otherwise required
by
this Agreement, management decisions, information, approvals and
acceptances so that Vendor may accomplish its obligations and
responsibilities hereunder.
|
|
(c)
|
Requirement
of Writing.
To the extent Vendor is required under this Agreement to obtain TXUED’s
approval, consent or agreement, such approval, consent or agreement
must
be in writing and must be signed by, or directly transmitted by electronic
mail from, the TXUED Account Executive or the applicable individual
to
whom authority has been delegated in accordance with Section
9.1(a).
Notwithstanding the preceding sentence, the TXUED Account Executive
may
agree in advance in writing that as to certain specific matters oral
approval, consent or agreement will be
sufficient.
|
|
(d)
|
SAS
70 Report.
If and to the extent reasonably required by Vendor in order for Vendor
to
comply with applicable Laws, then following Vendor’s request TXUED shall
provide to Vendor a copy of the relevant portions of the most recent
SAS
70 Type 2 audit report received by TXUED from Capgemini Energy
LP.
|
|
9.2
|
Savings
Clause.
Vendor’s failure to timely or otherwise perform its responsibilities under
this Agreement (including failure to meet the Service Levels) shall
be
excused if and to the extent such Vendor non-performance is directly
caused by (i) TXUED’s or any TXUED Third Party Contractor’s negligence or
wrongful acts or omissions or TXUED’s or any TXUED Third Party
Contractor’s breach of or failure to timely comply with its obligations
under this Agreement (unless and to the extent that any such negligence,
action or failure to act is by any Seconded TXUED Personnel or other
TXUED
Personnel performing activities under the direction or management
of
Vendor or Vendor Personnel), (ii) Software, Equipment or Systems
for which
TXUED or TXUED Third Party Contractors have operational responsibility
or
(iii) Vendor’s compliance with specific instructions of TXUED or TXUED
Third Party Contractors. Vendor agrees to timely notify TXUED of
such event and its inability to perform under such circumstances
to the
extent Vendor is aware thereof. To the extent such non-performance
has not
occurred, Vendor agrees to provide TXUED with every reasonable opportunity
to correct such event and thereby avoid such Vendor non-performance.
Vendor shall use commercially reasonable efforts to perform the Services
notwithstanding such events. Any Material Change resulting from the
acts,
omissions and other matters described in clauses (i) through (iii)
of this
Section shall be addressed through the Change Control
Process.
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10.
|
CHARGES
|
|
10.1
|
General.
|
|
(a)
|
Payment
of Charges.
In consideration of Vendor’s performance of the Services, TXUED agrees to
pay Vendor the applicable Charges set forth in Exhibit
11.
|
|
(b)
|
No
Additional Charges.
TXUED shall not pay any charges, fees or other amounts for the Services
in
addition to those set forth in this Agreement. Any costs incurred
by
Vendor prior to the Services Agreement Commencement Date are included
in
the Charges and shall not be separately paid or reimbursed by
TXUED.
|
|
(c)
|
Reserved.
|
|
(d)
|
Eligible
Recipient Services.
To the extent a designated Eligible Recipient will receive less than
all
of the Services, TXUED shall identify in advance the Services to
be
provided by Vendor to such Eligible Recipient. In the event of a
transaction described in Subsection (c) or (d) of the definition
of
Eligible Recipient, TXUED may elect, on behalf of the Eligible Recipient
in question, either (i) that such Eligible Recipient shall continue
to obtain some or all of the Services subject to and in accordance
with
this Agreement for the remainder of the term of the applicable Services
Agreement, or (ii) that the Eligible Recipient shall cease to receive
some or all of the Services as of a specified date, subject to its
receipt
of Termination Assistance Services pursuant to Section 4.2.
|
|
(e)
|
Transition
Charges.
|
|
(i)
|
Upon
Vendor’s request during the Transition Period, TXUED shall cause its
Affiliate, TXU Electric Delivery Property LLC, to enter into contracts
with third parties (including, potentially, Affiliates of Vendor)
that are
determined necessary by Vendor for the provision of the Transition
Services; provided that: (1) the aggregate amount of fees paid by
such
TXUED Affiliate under such contracts and otherwise for Vendor’s
re-branding of Resources, relocation of employees and employee benefit
plan designs, in each case prior to the Services Agreement Commencement
Date for the Field Services Agreement, shall not exceed three million,
one-hundred thousand dollars ($3,100,000) (the “Early
Transition Payments”);
and (2) the aggregate amount of fees paid by such TXUED Affiliate
under
such contracts for actual incremental costs and expenses that are
directly
incurred by Vendor and/or such TXUED Affiliate in order to (A) integrate
Vendor’s Systems with TXUED’s Systems, (B) modify or replace Vendor’s
owned or licensed Software and (C) develop new Software, in each
case as
necessary to transition the Services to Vendor and for Vendor to
perform
the Services, in the aggregate, prior to the Services Agreement
Commencement Date for the Field Services Agreement shall not exceed
eight
million dollars ($8,000,000) (the “IT
Payments”).
Vendor shall cause its Affiliate, InfrastruX Group,
Inc., to provide any reasonable cooperation and support (including
with
regard to negotiations) requested by TXUED or such TXUED Affiliate
in
connection therewith. The Parties shall cooperate to cause the contracts
contemplated by this Section
10.1(e)(i)
to
be managed and administered in a manner agreed to by the Parties.
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(ii)
|
Upon
the Services Agreement Commencement Date for the Field Services Agreement,
TXUED shall pay Vendor an amount equal to four million, one-hundred
thousand dollars ($4,100,000) minus
the total of all Early Transition Payments (the “Vendor
Transition Payment”)
in consideration of Vendor’s cost to achieve the Transition Services under
this Agreement, including incentive payments and severance payments
made
by Vendor to Transitioned Employees in order to mitigate any negative
impact (if any) of transition, relocation and/or severance upon such
personnel, Vendor’s re-branding of Resources, relocation of the Transition
Employees, and benefit plan designs.
|
|
(iii)
|
In
addition, commencing on the Services Agreement Commencement Date,
TXUED
shall reimburse Vendor for the reasonable actual incremental costs
and
expenses that are directly incurred by Vendor in order to (i) integrate
Vendor’s Systems with TXUED’s Systems, (ii) modify or replace Vendor’s
owned or licensed Software and (iii) develop new Software, in each
case as
necessary to transition the Services to Vendor and for Vendor to
perform
the Services; provided, however, that unless otherwise agreed to
by TXUED,
TXUED shall not be obligated to reimburse more than eight million
dollars
($8,000,000) in the aggregate minus
the total of all IT Payments. The Parties acknowledge and agree that
amounts paid to Vendor pursuant to this Section 10.1(e)
shall be earned by Vendor when so
paid.
|
|
10.2
|
Pass-Through
Expenses.
TXUED shall pay all Pass-Through Expenses directly to the applicable
suppliers following review, validation and approval of such Pass-Through
Expenses by Vendor. Before submitting an invoice to TXUED for any
Pass-Through Expense, Vendor shall (i) review and validate the
invoiced charges, (ii) identify any errors or omissions and
(iii) communicate with the applicable supplier to correct any errors
or omissions, resolve any questions or issues and obtain any applicable
credits for TXUED. Vendor shall deliver to TXUED the original supplier
invoice, together with any documentation supporting such invoice
and a
statement that Vendor has reviewed and validated the invoiced charges,
within ten (10) calendar days after Vendor’s receipt thereof, or if
earlier, at least three (3) days prior to the date on which payment
is due
if such invoice was received by Vendor at least ten (10) days prior
to
such due date. In addition, if the supplier offers a discount for
payment
prior to a specified date, Vendor shall deliver such invoice and
associated documentation to TXUED at least ten (10) days prior to
such
date, but no earlier than three (3) days after Vendor’s receipt of such
invoice. To the extent Vendor fails to comply with its obligations
hereunder, it shall be financially responsible for any discounts
actually
lost or any late fees or interest charges actually paid by TXUED
and in
addition, to the extent Vendor fails to process any invoice in accordance
with this provision, it shall be financially responsible for any
penalties
associated with late payment with respect to such invoiced amounts
actually paid by TXUED, provided that in each such case TXUED notified
Vendor of the importance of processing the applicable Pass-Through
Expense
in a timely manner and accordance with the underlying invoice
terms.
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10.3
|
Incidental
Expenses.
Vendor acknowledges that, except as otherwise expressly provided
in this
Agreement, all charges, fees, expenses and other amounts (in each
case
whether internal or in respect of third parties) that Vendor incurs
in
performing the Services and complying with this Agreement are included
in
the Charges. Accordingly, such charges, fees, expenses and amounts
shall
not be separately paid or reimbursed by
TXUED.
|
|
10.4
|
Taxes.
The Parties’ respective responsibilities for taxes arising under or in
connection with this Agreement shall be as
follows:
|
|
(a)
|
Income
Taxes. Each
Party shall be responsible for its own Income
Taxes.
|
|
(b)
|
Sales,
Use and Property Taxes. Each
Party shall be responsible for any sales, lease, use, personal property,
stamp, duty or other such taxes on Resources or property it owns
or leases
from a third party, including any lease assigned pursuant to this
Agreement, and/or for which it is financially responsible under this
Agreement.
|
|
(c)
|
Taxes
on Goods or Services Used by Vendor. Except
to the extent included in Pass-Through Expenses, Vendor shall be
responsible for all sales, service, value-added, lease, use, personal
property, excise, consumption and other taxes and duties, including
VAT,
payable by Vendor on any goods or services used or consumed by Vendor
in
providing the Services (including services obtained from Subcontractors)
where the tax is imposed on Vendor’s acquisition or use of such goods or
services and the amount of tax is measured by Vendor’s cost of acquiring
or procuring such goods or services and not by TXUED’s cost of acquiring
such goods or services from Vendor.
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(d)
|
Existing
Service Taxes.
Except as otherwise expressly set forth in Exhibit
11,
Vendor shall be responsible for all Service Taxes in effect as of
the
Master Agreement Effective Date.
|
|
(e)
|
Responsibility
for and Notice of New Taxes.
TXUED shall be responsible for any and all new Service Taxes (including
increases in existing Service Taxes) that come into effect after
January
1, 2005, and Vendor may pass-through to TXUED and TXUED shall be
responsible for the amounts of any new or increased taxes or other
charges
of the types described in Sections
10.4(b)
and 10.4(c)
arising by operation of a change in Law after January 1, 2005. The
administration of such matters as between the Parties shall be addressed
through the Change Control Process. Vendor shall promptly notify
TXUED
when it becomes aware of any new taxes or other charges (including
changes
to existing taxes or charges) to be passed through and/or collected
by
TXUED under this Section. Such notification (which must be separate
from
the first invoice reflecting such taxes or other charges, if applicable)
shall contain a detailed explanation of such taxes or charges, including
the effective date of each new tax or
charge.
|
|
(f)
|
Efforts
to Minimize Taxes.
The Parties agree to cooperate fully with each other to enable each
other
to more accurately determine its own tax liability and to minimize
such
liability to the extent legally permissible. Vendor’s invoices shall
separately state the Charges that are subject to taxation and the
amount
of taxes included therein. Each Party will provide and make available
to
the other any resale certificates, information regarding out-of-state
or
out-of-country sales or use of equipment, materials, or services,
and
other exemption certificates or information reasonably requested
by either
Party. At TXUED’s request, Vendor shall provide TXUED with
(i) written certification signed by a senior executive of Vendor
confirming that Vendor has filed all required tax forms and returns
required in connection with any Service Taxes collected from TXUED,
and
has collected and remitted all applicable Service Taxes, and
(ii) such other information pertaining to applicable Taxes as TXUED
may reasonably request.
|
|
(g)
|
Tax
Audits or Proceedings.
|
|
(i)
|
The
provisions of this Section 10.4(g)(i)
shall apply with respect to any audit, proceeding or claim by any
Tax
Authority that relates to taxes assessed by such Tax Authority for
which
the other Party is financially responsible and that relates solely
to such
other Party and, with respect to Vendor, does not involve claims
for taxes
assessed in connection with any other customer of Vendor. Each Party
shall
promptly notify the other Party of, and coordinate with the other
Party,
the response to and settlement of, any claim for Tax Authorities
for which
the other Party is financially responsible under this Agreement.
With
respect to any claim arising out of a form or return signed by a
Party to
this Agreement, such Party will have the right to elect to control
the
response to and settlement of the claim, but the other Party will
have all
rights to participate in the responses and settlements commensurate
with
its potential responsibilities or liabilities. Each Party also shall
have
the right to challenge the imposition of any tax liability for which
it is
financially responsible under this Agreement or, if necessary, to
direct
the other Party to challenge the imposition of any such tax liability.
If
either Party requests the other to challenge the imposition of any
tax
liability, such other Party shall do so (unless and to the extent
it
assumes financial responsibility for the tax liability in question),
and
the requesting Party shall reimburse the other for all fines, penalties,
interest, additions to taxes or similar liabilities imposed in connection
therewith, plus the reasonable legal, accounting and other professional
fees and expenses it incurs. Each Party shall be entitled to any
tax
refunds or rebates obtained with respect to the taxes for which such
Party
is financially responsible under this
Agreement.
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(ii)
|
The
provisions of this Section 10.4(g)(ii)
shall apply to any audit, proceeding or claim by any Tax Authority
that
relates to a type of tax (e.g., a Service Tax) assessed by such Tax
Authority to one Party for which the other Party is financially
responsible under this Agreement and for which Vendor or other Vendor
customers are also financially responsible in other similar transactions.
Each Party shall promptly notify the other of any claim for taxes
assessed
by applicable Tax Authorities for which the other Party is responsible
under this Agreement. Each Party shall provide any information related
to
such claim reasonably requested by the other Party. If either Party
has a
reasonable basis for a challenge and requests the other to so challenge
the imposition of any tax liability, such other Party shall do so
(unless
and to the extent it assumes financial responsibility for the tax
liability in question), and the requesting Party shall reimburse
the other
for all reasonable legal, accounting or other professional fees and
expenses it incurs in such challenge. In addition, neither Party
shall
enter into a settlement of any tax liability that creates a binding
financial obligation for the other Party without the other Party’s
approval, which shall not be unreasonably withheld; provided that
the
other Party assumes financial liability for any interest, penalties
or
fines which accrue on the claimed amount, and provided further that
this
Subsection (ii) shall not limit Vendor’s right or ability to settle
similar claims related to other customers or amounts for which Vendor
has
financial responsibility. Each Party shall be entitled to any tax
refunds
or rebates obtained with respect to taxes for which such Party is
financially responsible under this
Agreement.
|
|
(h)
|
Tax
Filings.
Each Party represents, warrants and covenants that it will file
appropriate tax returns, and pay applicable taxes owed arising from
or
related to the provision of the Services in applicable jurisdictions.
Vendor represents, warrants and covenants that it is registered to
and
will collect and remit Service Taxes in all applicable
jurisdictions.
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10.5
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New
Services.
|
|
(a)
|
Procedures.
TXUED may request that Vendor submit proposals for Vendor’s provision of
New Services. Vendor shall not be required to submit any such proposal
unless the New Services are (1) generally provided by Vendor, (2)
required
by Law or (3) reasonably related to the Services and will be performed
within TXUED’s service territory as such service territory exists on the
Master Agreement Effective Date or within a reasonable geographic
proximity to such service territory, in which case Vendor shall promptly
prepare a New Services proposal for TXUED’s consideration. Unless
otherwise agreed by the Parties, Vendor shall prepare New Services
proposals at no additional charge to TXUED and shall use commercially
reasonable efforts to deliver New Services proposals to TXUED within
thirty (30) days of its receipt of TXUED’s request or more quickly in the
case of a pressing business need or an emergency situation. TXUED
shall
timely provide such information as Vendor reasonably requests in
order to
prepare New Service proposals. Vendor’s
New Services proposals shall include the following at a level of
detail
sufficient to permit TXUED to make an informed business decision:
(i) a project plan and fixed price or price estimate for the New
Service, (ii) a breakdown of such price or estimate, (iii) any
efficiency or productivity improvements that such New Service shall
enable
in Vendor’s performance and/or TXUED’s receipt and use of the Services,
(iv) a description of the service levels to be associated with such
New Service, (v) a schedule for commencing and completing the New
Service, (vi) a description of any new Resources to be provided by
Vendor in connection with the New Service, (vii) a description of any
Resources necessary to provide the New Service and (viii) any
additional facilities or labor resources to be provided by TXUED
in
connection with the proposed New Service. TXUED may accept or reject
any
New Services proposal in its sole discretion and Vendor shall not
be
obligated to perform any New Services to the extent the applicable
proposal is rejected. TXUED’s acceptance of a New Services proposal shall
only be valid and binding on TXUED if approved in writing by the
TXUED
Account Executive. Unless the Parties otherwise agree, if TXUED accepts
Vendor’s proposal, Vendor will perform the New Services and be paid in
accordance with the proposal submitted by Vendor and the provisions
of
this Agreement. Upon TXUED’s acceptance of a Vendor proposal for New
Services, the scope of the Services will be expanded and the applicable
Services Agreement will be modified to include such New Services.
Notwithstanding any provision to the contrary, (i) Vendor shall act
reasonably and in good faith in formulating such pricing proposal,
(ii) Vendor shall identify potential means of reducing the cost to
TXUED, including utilizing Subcontractors as and to the extent appropriate
and (iii) such pricing proposal shall comply with the terms of
Section
10.8.
|
|
(b)
|
Use
of Third Parties.
TXUED may elect to solicit and receive bids from third parties to
perform
any New Services. If TXUED elects to use third parties to perform
New
Services, (i) such New Services shall not be deemed “Services” under
this Agreement, and (ii) Vendor shall cooperate with such third
parties as provided in Section 4.3(b).
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(c)
|
Services
Evolution and Modification.
The Parties anticipate that the Services will evolve and be supplemented,
modified, enhanced or replaced over time to keep pace with technological
and process advancements and improvements in the methods of performing
and
delivering services and the changes in the businesses of TXUED. The
Parties acknowledge and agree that these changes will modify the
Services
and will not be deemed to result in New Services unless the changed
services meet the definition of New Services, in which case Vendor
shall
have the right to produce a proposal for TXUED to provide such New
Services.
|
|
(d)
|
End
User and Eligible Recipient Requests. Vendor
will promptly inform the TXUED Account Executive of any requests
for New
Services, and subject to the provisions of Subsection (a) above,
shall
submit any proposals for New Services to the TXUED Account Executive.
Vendor shall not agree to provide New Services without the prior
written
approval of the TXUED Account Executive. If Vendor fails to comply
strictly with this Section 10.5(d),
it shall receive no compensation for any services rendered to any
person
or entity.
|
|
(e)
|
Efforts
to Reduce Costs and Charges.
TXUED may request that the Parties work together to identify ways
to
achieve reductions in the cost of service delivery and corresponding
reductions in the Charges to be paid by TXUED by modifying or reducing
the
nature or scope of the Services, the applicable Service Levels or
other
contract requirements. If requested by TXUED, Vendor shall promptly
prepare a proposal at a level of detail sufficient to permit TXUED
to make
an informed business decision identifying all viable means of achieving
the desired reductions without adversely impacting business objectives
or
requirements identified by TXUED. In preparing such a proposal, Vendor
shall give reasonable consideration to any means of achieving such
reductions proposed by TXUED, Vendor shall negotiate in good faith
with
TXUED about each requested reduction in Charges and shall identify
to
TXUED if and to what extent the cost of service delivery may be reduced
by
implementing various changes in this Agreement. TXUED shall not be
obligated to accept or implement any proposal, and Vendor shall not
be
obligated to implement any change that affects the terms of this
Agreement
unless and until such change is reflected in a written amendment
to this
Agreement.
|
|
10.6
|
Proration.
Periodic charges under this Agreement are to be computed on a calendar
month basis, and shall be prorated for any partial month on a calendar
day
basis.
|
|
10.7
|
Refundable
Items.
|
If
either
Party should receive a refund, credit, discount or other rebate for goods or
services paid by the other Party, the recipient Party shall (i) notify the
other Party of such refund, credit, discount or rebate and (ii) pay the
full amount of such refund, credit, discount or rebate to the other
Party.
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10.8
|
*** |
|
11.
|
INVOICING
AND PAYMENT
|
|
11.1
|
Invoicing.
|
|
(a)
|
Invoice.
Following the Services Agreement Commencement Date for each Services
Agreement, Vendor shall present invoices to TXUED twice each month
for any
Charges due and owing under that Services Agreement for the preceding
period (the “Bi-Monthly
Invoice”),
including the Base Services Charges and any ARCs and RRCs. Each Bi-Monthly
Invoice shall be presented by Vendor to TXUED within five (5) days
after
the first (1st)
and fifteenth (15th)
day of each month. Each Bi-Monthly invoice shall be delivered to
TXUED, at
its request, at the address(es) listed in Section
19.3
and/or electronically. Except as otherwise expressly permitted in
Exhibit 11,
Vendor shall not invoice TXUED for any advance or concurrent charges
or
other amounts.
|
|
(b)
|
Payment.
Subject to the other provisions of this Article
11,
each Bi-Monthly Invoice shall be due and payable within fifteen (15)
days
after receipt by TXUED of such Bi-Monthly Invoice unless the amount
in
question is disputed in accordance with Section
11.4.
|
|
(c)
|
Form
and Data.
At TXUED’s request, Vendor shall provide separate Bi-Monthly Invoices for
each Eligible Recipient then receiving Services, allocated among
such
Eligible Recipients based on the chargeback data generated by Vendor
and/or the allocation formula provided by TXUED. Each invoice shall
(i) comply with all applicable legal, regulatory and accounting
requirements and (ii) allow TXUED to validate volumes and fees. Upon
TXUED’s request, Vendor shall within seven (7) days provide TXUED with
information and data to permit TXUED to chargeback internally to
the same
organizational level and at the same level of detail in use by TXUED
as of
the Services Agreement Commencement Date as has been communicated
by TXUED
to Vendor. Each invoice shall include the pricing calculations and
related
data utilized to establish the Charges. The data underlying each
invoice
shall be delivered to TXUED electronically in a form and format compatible
with TXUED’s accounting systems.
|
***CONFIDENTIAL
MATERIAL REDACTED AND FILED SEPARATELY WITH THE
COMMISSION.
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(d)
|
Credits.
To the extent a credit may be due to TXUED pursuant to this Agreement,
Vendor shall provide TXUED with an appropriate credit against amounts
then
due and owing; if no further payments are due to Vendor, Vendor shall
pay
such amounts to TXUED within fifteen (15) days of the date of Vendor’s
final invoice.
|
|
(e)
|
Time
Limitation.
If Vendor fails to provide an invoice (other than with respect to
Pass-Through Expenses) to TXUED for any amount within one hundred
eighty
(180) days after the month in which the Services in question are
rendered
or the expense incurred, Vendor shall waive all rights it may otherwise
have to invoice for and collect such
amount.
|
|
11.2
|
Payment
Due.
Any undisputed amounts due under this Agreement for which a time
of
payment is not otherwise specified shall be due and payable within
fifteen
(15) days of the receipt of a proper invoice by TXUED.
Any late payments shall be subject to interest from the date on which
payment was due at the then current rate set by Citibank, N.A. as
its
prime lending rate plus two (2) percent per annum. Additionally,
in the
case of each Bi-Monthly Invoice, if any undisputed amount thereof
is not
paid by the date due under Section 11.1(b), then, from and after
the date
of notice from Vendor to TXUED stating that such amount is overdue,
such
amount shall be subject to interest from and including the date of
such
notice to and including the actual date of payment at the lesser
of (i)
the then current rate set by Citibank, N.A. as its prime lending
rate plus
ten percent (10%), per annum (ii) or the highest interest rate permitted
by applicable law.
|
|
11.3
|
Set
Off.
With respect to any amount to be paid or reimbursed by either Party
under
a particular Services Agreement, such Party may set off against such
amount any amount that the other Party is obligated to pay or credit
such
Party under the applicable Services
Agreement.
|
|
11.4
|
Disputed
Charges.
TXUED may only withhold payment of relevant portions of the Charges
if
TXUED reasonably disputes such portions of the Charges in good faith
subject to the following:
|
|
(a)
|
Description
and Explanation.
TXUED shall notify Vendor and provide a description of the particular
Charges in dispute and an explanation of the reason why TXUED disputes
such Charges.
|
|
(b)
|
Continued
Performance.
If TXUED has withheld payment in accordance with the provisions of
this
Section, each Party agrees to continue performing its obligations
under
this Agreement while the applicable dispute is being resolved unless
and
until such obligations are terminated by the termination or expiration
of
this Agreement.
|
|
(c)
|
Resolutions
of Disputed Amounts and Incorrect Invoices.
Upon resolution of a dispute regarding disputed Charges or inaccurate
invoices, (i) TXUED shall promptly pay to Vendor any such Charges
determined to be due to Vendor together with interest from the date
originally due at the then current rate set by Citibank, N.A. as
its prime
lending rate plus two (2) percent per annum and (ii) Vendor shall
promptly
pay to TXUED an amount equal to (x) the dollar amount of inaccuracies
on
the invoice multiplied
by
(y) the then current rate set by Citibank, N.A. as its prime lending
rate
plus two (2) percent per annum.
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(d)
|
No
Waiver.
Neither the failure to dispute any Charges or amounts prior to payment
nor
the failure to withhold any amount shall constitute, operate or be
construed as a waiver of any right TXUED may otherwise have to dispute
any
Charge or amount or recover any amount previously
paid.
|
|
12.
|
TXUED
DATA AND OTHER PROPRIETARY
INFORMATION
|
|
12.1
|
TXUED
Ownership of TXUED Data.
TXUED Data are and shall remain the property of TXUED and Vendor
shall not
possess or assert any lien or other interest, title or right in,
to or
under any TXUED Data. Vendor shall promptly deliver TXUED Data (or
the
portion of such TXUED Data specified by TXUED) to TXUED in the format
and
on the media on which such TXUED Data is held or contained by Vendor
in
accordance with this Agreement (i) at any time at TXUED’s request,
(ii) at the end of the term of each applicable Services Agreement and
the completion of all requested Termination Assistance Services or
(iii) with respect to particular TXUED Data, at such earlier date
that such data are no longer required by Vendor to perform the Services.
Thereafter, Vendor shall return or destroy, as directed by TXUED,
all
copies of the TXUED Data in Vendor’s possession or under Vendor’s control
within ten (10) days and deliver to TXUED written certification of
such
return or destruction signed by a senior executive of Vendor. TXUED
Data
shall not be utilized by Vendor for any purpose other than the performance
of Services and shall not be sold, assigned, leased, commercially
exploited or otherwise provided to third parties by or on behalf
of Vendor
or any Vendor Personnel, but may, subject to TXUED’s prior approval, be
blended or aggregated with Vendor’s other customers’ data to develop
benchmarks and for other research and development activities (provided
that Vendor shall not disclose to any other person or Entity that
portion
of TXUED Data that specifically identifies TXUED, TXUED’s customers,
officers, directors, employees, agents or representatives or any
personally identifiable information of any such persons. Notwithstanding
any other provision of this Agreement, Vendor shall not undertake
or
engage in any activity with respect to any TXUED Personal Data which
would, under applicable Privacy Laws, constitute Vendor’s functioning in
the capacity of a “controller,” as such capacity may be identified and
defined in the respective applicable Privacy Laws and Vendor shall
promptly notify TXUED if it believes that any use of TXUED Data by
Vendor
contemplated under this Agreement or to be undertaken as part of
the
Services would, under applicable Privacy Laws, constitute Vendor
so
functioning in the capacity of a
“controller.”
|
|
12.2
|
Safeguarding
TXUED Data.
|
|
(a)
|
Safeguarding
Procedures. Vendor
shall establish and maintain environmental, safety and facility
procedures, data security procedures and other safeguards against
the
destruction, loss or unauthorized access, use or alteration of TXUED
Data
in the possession of Vendor which are (i) no less rigorous than those
maintained by TXUED as of the applicable Services Agreement Commencement
Date (or implemented by TXUED in the future to the extent deemed
necessary
by TXUED), as the same may be amended or modified from time to time,
and
(ii) adequate to meet the requirements of TXUED’s then current
records retention policy. Vendor will revise and maintain such procedures
and safeguards upon TXUED’s request, and any Material Change resulting
from additions or modifications to such procedures or safeguards
shall be
addressed through the Change Control Process. TXUED shall have the
right
to establish backup security for TXUED Data and to keep in its possession
backup copies of TXUED Data at TXUED’s expense. Vendor shall remove all
TXUED Data from any of its media, or media for which it is operationally
responsible, taken out of service and shall destroy or securely erase
such
media in accordance with the Policy and Procedures Manual. No media
on
which TXUED Data is stored may be used or re-used to store data of
any
other customer of Vendor or to deliver data to a third party, including
another Vendor customer, unless securely erased in accordance with
the
Policy and Procedures Manual. In the event Vendor discovers or is
notified
of a breach or potential breach of security relating to TXUED Data,
Vendor
shall (i) immediately notify TXUED of such breach or potential breach
and perform a Root Cause Analysis thereon, (ii) investigate such
breach or potential breach, (iii) if the breach is attributable to
Vendor, remediate the effects of such breach or potential breach
and
(iv) if the breach is attributable to Vendor, provide TXUED with such
assurances as TXUED shall request that such breach or potential breach
will not recur.
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(b)
|
Reconstruction
Procedures.
Vendor shall be responsible for developing and maintaining procedures
for
the reconstruction of destroyed, lost or altered TXUED Data which
are (i)
no less rigorous than those maintained by TXUED as of the applicable
Services Agreement Commencement Date and (ii) no less rigorous than
those
maintained by Vendor for its own and other customers’ information of a
similar nature as the same may be amended and modified from time
to
time.
|
|
(c)
|
Corrections.
Vendor shall correct all TXUED Data that is or was used by Vendor
or in
its possession or under its control that is altered or that becomes
inaccurate after the Master Agreement Effective Date; provided that
any
such alteration or inaccuracy caused by TXUED or that existed prior
to the
Master Agreement Effective Date shall be corrected by Vendor at TXUED's
expense.
|
|
(d)
|
Restoration.
Vendor
shall restore all TXUED Data that is destroyed or becomes lost after
the
applicable Services Agreement Commencement Date (other than in the
instances in which the Parties reasonably agree that it would be
impracticable to restore such TXUED Data); provided that any destruction
or loss caused by TXUED or that existed prior to the applicable Services
Agreement Commencement Date shall be corrected by Vendor at TXUED's
expense.
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12.3
|
Confidentiality.
|
|
(a)
|
Proprietary
Information.
Vendor and TXUED each acknowledge that the other possesses and will
continue to possess information that has been developed or received
by it,
has commercial value in its or its customers’ businesses and is not
generally available to the public. Except as otherwise specifically
agreed
in writing by the Parties, “Proprietary
Information”
shall mean (i) this Agreement and the terms hereof, (ii) all
information marked confidential, restricted or proprietary by either
Party
and (iii) any other information that is treated as confidential by
the disclosing Party and would reasonably be understood to be
confidential, whether or not so marked. In the case of TXUED, Proprietary
Information also shall include TXUED Data, attorney-client privileged
materials, attorney work product, customer lists, customer contracts,
customer information, rates and pricing, information with respect
to
competitors, strategic plans, account information, rate case strategies,
research information, chemical formulae, product formulations, plant
and
equipment design information, catalyst information, information that
contains trade secrets, financial/accounting information (including
assets, expenditures, mergers, acquisitions, divestitures, xxxxxxxx
collections, revenues and finances), human resources and personnel
information, marketing/sales information, information regarding
businesses, plans, operations, third party contracts, licenses, internal
or external audits, law suits, regulatory compliance or other information
or data, but only to the extent it is obtained, received, transmitted,
processed, stored, archived, or maintained by Vendor strictly for
use
under this Agreement. By way of example, TXUED’s Proprietary Information
shall include plans for changes in TXUED Facilities, Business Units
and
product lines, plans for business mergers, acquisitions or divestitures,
rate information, plans for the development and marketing of new
products,
financial forecasts and budgets, technical proprietary information,
employee lists and company telephone or e-mail directories. In the
case of
Vendor, Proprietary Information shall include Vendor Data, data,
financial
information, account information, information regarding Vendor’s business
plans and operations and proprietary software, tools and methodologies
owned by Vendor and used in the performance of the Services, plans
for
changes in Vendor’s facilities, Business Units and product lines, plans
for business mergers, acquisitions or divestitures, plans for the
development and marketing of new products, financial forecasts and
budgets, technical proprietary information, employee lists and company
telephone or e-mail directories. Each Party’s Proprietary Information
shall remain the property of such
Party.
|
|
(b)
|
Obligations.
|
|
(i)
|
During
the Term and at all times thereafter subject to Section 12.3(f),
Vendor and TXUED shall not disclose, and shall maintain the
confidentiality of, all Proprietary Information of the other Party.
TXUED
and Vendor shall each use at least the same degree of care to safeguard
and to prevent disclosing to third parties the Proprietary Information
of
the other as it employs to avoid unauthorized disclosure, publication,
dissemination, use, destruction, loss or alteration of its own information
(or information of its customers) of a similar nature, but not less
than
reasonable care. Each Party’s personnel shall have access to the other
Party’s Proprietary Information only to the extent necessary for such
person to perform his or her obligations under or with respect to
this
Agreement or as otherwise naturally occurs in such person’s scope of
responsibility, provided that such access is not in violation of
Law.
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(ii)
|
The
Parties may disclose Proprietary Information to their Affiliates
(except
where prohibited by TXUED Rules or Vendor’s rules of which TXUED has been
made aware), auditors, attorneys, accountants, consultants, contractors,
subcontractors and other professional advisors, where (A) use by
such
person or entity is authorized under this Agreement or (B) such
disclosure is necessary for the performance of such person’s or entity’s
obligations under or with respect to this Agreement (including in
furtherance of the preservation or exercise of the rights, remedies
and
privileges of a Party) or otherwise naturally occurs in such person’s or
entity’s scope of responsibility. The disclosing Party shall be
responsible for the acts or omissions of such person or entity and
shall
take all necessary steps to ensure that the Proprietary Information
is not
disclosed or used in contravention of this Agreement. Any disclosure
to
such person or entity shall be under the terms and conditions as
provided
herein.
|
|
(iii)
|
Neither
Party shall (A) make any use or copies of the Proprietary Information
of
the other Party except as contemplated by this Agreement, (B) acquire
any right, title or interest in, to or under or assert any lien against
the Proprietary Information of the other Party, (C) sell, assign,
transfer, lease, or otherwise dispose of Proprietary Information
to third
parties or commercially exploit such information, including through
Derivative Works or (D) refuse for any reason (including a default
or
material breach of this Agreement by the other Party) to promptly
provide
the other Party’s Proprietary Information (including copies thereof) to
the other Party if requested to do so. Upon expiration or any termination
of this Agreement and completion of each Party’s obligations under this
Agreement, each Party shall return or destroy, as the other Party
may
direct, all documentation in any medium that contains, refers to
or
relates to the other Party’s Proprietary Information within thirty (30)
days. Each Party shall deliver to the other Party written certification
of
its compliance with the preceding sentence signed by a senior executive
of
such Party. In addition, each Party shall take all necessary steps
to
ensure that its employees comply with these confidentiality
provisions.
|
|
(c)
|
Exclusions.
Section 12.3(b)
shall not apply to any particular information which the receiving
Party
can demonstrate: (i) is, at the time of disclosure to it, generally
available to the public other than through a breach of the receiving
Party’s or a third party’s confidentiality obligations, (ii) after
disclosure to it, is published by the disclosing Party or otherwise
becomes generally available to the public other than through a breach
of
the receiving Party’s or a third party’s confidentiality obligations,
(iii) is lawfully in the possession of the receiving Party at the
time of disclosure to it, (iv) is received from a third party having
a lawful right to disclose such information or (v) is independently
developed by the receiving Party without reference to Proprietary
Information of the disclosing Party. Information disclosed hereunder
and
any combination of features thereof shall not be deemed to be within
the
foregoing exceptions merely because such information or any combination
of
the individual features thereof are embraced by more general information
in the public knowledge or literature. In addition, the receiving
Party
shall not be considered to have breached its obligations under this
Section for disclosing Proprietary Information of the other Party
as
required, in the opinion of legal counsel, to satisfy any legal
requirement of a competent government body, provided that promptly
upon
receiving any such request such Party, to the extent it may legally
do so,
advises the other Party of the Proprietary Information to be disclosed
and
the identity of the third party requiring such disclosure prior to
making
such disclosure in order that the other Party may interpose an objection
to such disclosure, take action to assure confidential handling of
the
Proprietary Information or take such other action as it deems appropriate
to protect the Proprietary Information. The receiving Party shall
use
commercially reasonable efforts to cooperate with the disclosing
Party in
its efforts to seek a protective order or other appropriate remedy
or in
the event such protective order or other remedy is not obtained,
to obtain
assurance that confidential treatment will be accorded such Proprietary
Information.
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(d)
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Misuse
of Proprietary Information.
Each Party shall (i) immediately notify the other Party of any
possession, use, knowledge, disclosure, publication, dissemination,
alteration or loss of such other Party’s Proprietary Information in
contravention of this Agreement, (ii) promptly furnish to the other
Party all known details and assist such other Party in investigating
and/or preventing the reoccurrence thereof, (iii) cooperate with the
other Party in any investigation or litigation deemed necessary by
such
other Party to protect its rights and (iv) promptly use all
commercially reasonable efforts to prevent further possession, use,
knowledge, disclosure, publication, dissemination, alteration or
loss of
Proprietary Information in contravention of this Agreement. Each
Party
shall bear any costs it incurs in complying with this Section 12.3(d).
|
|
(e)
|
No
Implied Rights.
Nothing contained in this Section 12.3
shall be construed as obligating a Party to disclose its Proprietary
Information to the other Party, or as granting to or conferring on
a
Party, expressly or impliedly, any rights, title, interests or license
in,
to or under any Proprietary Information of the other
Party.
|
|
(f)
|
Survival.
The Parties’ obligations of non-disclosure and confidentiality shall
survive the expiration or termination of this Agreement for a period
of
three (3) years other than with respect to trade secrets, in which
case
the obligations shall survive until such time as the applicable
information no longer constitutes Proprietary Information as defined
in
this Agreement.
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12.4
|
File
Access.
Subject to reasonable security, confidentiality and regulatory
restrictions imposed by Vendor, TXUED shall have access to, and the
right
to review and retain the entirety of, all computer or other files
containing TXUED Data, as well as all systems and network logs, system
parameters and documentation. At no time shall any of such files
or other
materials or information be stored or held in a form or manner not
accessible to TXUED. Upon the request of the TXUED Account Executive,
Vendor shall confirm that all files and other information provided
to
TXUED are complete and that no material element, amount, or other
fraction
of such files or other information to which TXUED may request access
or
review has been deleted, lost, withheld, disguised or encoded in
a manner
inconsistent with the purpose and intent of providing access to TXUED
as
contemplated by this Agreement.
|
|
13.
|
REPRESENTATIONS,
WARRANTIES AND ADDITIONAL
COVENANTS
|
|
13.1
|
Reserved.
|
|
13.2
|
Authorization.
|
Each
Party represents and warrants to the other that:
|
(a)
|
Existence.
It is duly incorporated, formed or organized, as applicable, validly
existing and in good standing under applicable
Laws;
|
|
(b)
|
Power
and Authority.
It has the requisite organizational power and authority to execute,
deliver and perform its obligations under this Agreement;
|
|
(c)
|
Legal
Authority.
It has obtained all governmental authorizations, approvals or permits
required to perform its obligations under this Agreement under all
applicable Laws, except to the extent the failure to obtain any such
authorizations, approvals or permits is, in the aggregate,
immaterial;
|
|
(d)
|
Due
Authorization.
The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated by this Agreement have
been
duly authorized by the requisite organizational action on the part
of such
Party; and
|
|
(e)
|
No
Violation or Conflict.
The execution, delivery and performance of this Agreement shall not
constitute a violation of any judgment, order or decree; a material
default under any material contract by which it or any of its material
assets are bound; or an event that would, with notice or lapse of
time, or
both, constitute such a default.
|
|
13.3
|
Compliance
with Laws.
|
|
(a)
|
Compliance
by Vendor.
Vendor represents, warrants and covenants that, with respect to the
provision or receipt of the Services and the performance of its other
legal and contractual obligations hereunder, it is and shall be,
in
compliance with all applicable Laws, including identifying and procuring
applicable permits, certificates, approvals and inspections required
under
all Laws. If a charge of non-compliance by Vendor with any Law occurs
that
impacts or is likely to impact Vendor’s performance under this Agreement,
Vendor shall promptly notify TXUED of such
charge.
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(b)
|
Compliance
by TXUED.
TXUED represents, warrants and covenants that, with respect to the
performance of its legal and contractual obligations hereunder, it
is and
shall be, in compliance with all applicable Laws. If a charge of
non-compliance by TXUED with any Law occurs that impacts or is likely
to
impact Vendor’s performance under this Agreement, TXUED shall promptly
notify Vendor of such charge.
|
|
(c)
|
Compliance
Data and Reports.
At no additional charge and upon a Party’s request, the other Party shall
provide the requesting Party with data and reports in such Party’s
possession necessary for the requesting Party to meet its obligations
to
comply with Laws.
|
|
(d)
|
Notice
of Laws.
The Parties shall cooperate in interpreting Laws and identifying
the
impact of Laws on the Services; provided that with respect to those
Laws
applicable to the businesses of TXUED, TXUED shall retain the right,
in
its reasonable discretion, to interpret and determine the impact
of such
Laws on the Services. At TXUED’s request, Vendor Personnel shall
participate in TXUED provided regulatory compliance training
programs.
|
|
(e)
|
Compliance
with Changes in Laws.
Vendor shall comply with all changes in Laws relevant to the provision
of
the Services and the performance of its other legal and contractual
obligations hereunder. Vendor is specifically on notice that such
Laws
include the Public Utility Regulatory Act and the Substantive Rules
Applicable to Electric Service Providers, Texas Administrative Code,
Title
16, Part II, Chapter 25, and any and all Laws that may be referenced
in
the TXUED Rules, TXUED Standards and other TXUED policies and procedures
provided to Vendor from time to
time.
|
|
(f)
|
TXUED
Costs and Savings.
TXUED shall be responsible for all costs and expenses resulting from
changes in Laws applicable to the businesses of TXUED or TXUED’s receipt
or use of the Services (including those changes in Laws applicable
to the
businesses of TXUED that impact the Services, as provided in Section
13.3(d)).
Any Material Change resulting from changes in Laws applicable to
the
businesses of TXUED or TXUED’s receipt or use of the Services (including
those changes in Laws applicable to the businesses of TXUED that
impact
the Services, as provided in Section
13.3(d))
shall be addressed through the Change Control Process. To the extent
such
changes in Laws impact other Vendor customers, any additional costs
shall
be apportioned on an equitable basis to all such customers.
|
|
(g)
|
Vendor
Costs and Changes in Law.
If, following January 1, 2005, there has been or is any change in
any Law
(excluding only changes in income tax Laws) that impacts the Services
or
that results in any increases in Vendor’s direct or indirect costs or
expenses (including those embedded in Vendor’s cost structure) that result
in a Material Change, Vendor shall have the right to additional payments
or increased usage charges as a result of any Material Change resulting
from such change in any Law, which shall be addressed through the
Change
Control Process.
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(h)
|
Compliance
with Data Privacy Laws.
Without limiting the foregoing, with respect to any TXUED Personal
Data,
Vendor shall provide TXUED with such assistance as TXUED may reasonably
require to fulfill its responsibilities under the respective applicable
Privacy Laws.
|
|
(i)
|
Responsibility.
Vendor shall be responsible for any Losses imposed on Vendor or TXUED
resulting from any failure of Vendor to comply with applicable Laws
or
respond in a timely manner to changes in such Laws, unless and to
the
extent such failure directly results from the acts or omissions of
TXUED,
an Eligible Recipient or an TXUED Third Party Contractor in contravention
of TXUED’s obligations under this Agreement. TXUED shall be responsible
for any Losses imposed on Vendor or TXUED resulting from any failure
of
TXUED to comply with applicable Laws or respond in a timely manner
to
changes in such Laws, unless and to the extent such failure directly
results from the acts or omissions of Vendor or any Vendor Personnel
in
contravention of Vendor’s obligations under this
Agreement.
|
|
13.4
|
Resources.
|
|
(a)
|
Ownership
and Use.
Vendor represents, warrants and covenants that it is either the owner
of,
or authorized to use, any and all Resources used by Vendor in providing
the Services, and has and shall have sufficient rights to grant to
TXUED
those rights and licenses contained in this Agreement. As to such
Resources that Vendor does not own, Vendor shall advise TXUED as
to the
ownership and extent of Vendor’s rights with regard to such Resources to
the extent any limitation in such rights would impair Vendor’s performance
of its obligations under this
Agreement.
|
|
(b)
|
Performance.
Vendor warrants and covenants that all Resources used by Vendor in
providing the Services shall be Compliant.
|
|
(c)
|
Nonconformity.
In the event that any Resources used by Vendor in providing the Services
are not Compliant and/or materially and adversely affect the Services,
Vendor shall expeditiously repair or replace such Resources with
Compliant
Resources.
|
|
13.5
|
Non-Infringement.
Each Party represents and warrants that it shall perform its
responsibilities under this Agreement in a manner that does not infringe,
or constitute an infringement or misappropriation of, and that all
Materials provided under this Agreement or any other Transaction
Document
by such Party or its Affiliates to the other Party at any time will
not
infringe, or constitute an infringement or misappropriation of, any
patent, copyright, trademark, trade secret or other proprietary,
intellectual property or privacy rights of any third party; provided,
however, that the performing or providing Party shall not have any
obligation or liability to the extent any infringement or misappropriation
is caused by (i) Materials provided by the other Party,
(ii) modifications made by the other Party or its contractors or
subcontractors, without the knowledge or approval of the performing
Party,
(iii) the other Party’s combination of the performing Party’s work
product or Materials with items not furnished, specified or reasonably
anticipated by the performing Party or contemplated by this Agreement,
(iv) a breach of this Agreement by the other Party or (v) the
failure of the other Party to use corrections or modifications provided
by
the performing Party offering equivalent features and functionality.
Each
Party further represents and warrants that it will not use or create
materials in connection with the Services which are libelous, defamatory
or obscene.
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13.6
|
TXUED
2004 Base
Case.
TXUED represents and warrants that it is not aware of any material
errors
or omissions in the TXUED 2004 Base Case. To the best of TXUED’s
knowledge, TXUED’s actual costs for the Base Services that were performed
by TXUED and TXUED Third Party Contractors in calendar year 2005
bear a
reasonable relation to the Base Services
Charges.
|
|
13.7
|
Reserved.
|
|
13.8
|
Disclaimer.
EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT (WHICH,
FOR THE
AVOIDANCE OF DOUBT, INCLUDES EACH OF THE SERVICES AGREEMENTS), EACH
PARTY
DISCLAIMS, AND NEITHER PARTY MAKES ANY REPRESENTATIONS, COVENANTS
OR
WARRANTIES TO THE OTHER PARTY, WHETHER EXPRESS OR IMPLIED, INCLUDING
IMPLIED WARRANTIES AND COVENANTS OF MERCHANTABILITY AND FITNESS FOR
A
PARTICULAR PURPOSE AND ALL OTHER WARRANTIES ARISING BY OPERATION
OF LAW,
COURSE OF DEALING, CUSTOM OF TRADE OR
OTHERWISE.
|
|
14.
|
INSURANCE
AND RISK OF LOSS
|
|
14.1
|
Vendor
Insurance. Vendor
shall comply with the provisions of Exhibit
9.
|
|
15.
|
INDEMNITIES
|
|
15.1
|
Indemnity
by Vendor.
Vendor agrees to indemnify, defend and hold harmless TXUED and its
officers, directors, employees, agents, representatives, successors
and
assigns from and against any and all Losses due to third party claims
(excluding the claims of TXUED’s Affiliates and Eligible Recipients)
arising from or in connection with any of the
following:
|
|
(a)
|
Representations
and Warranties.
Vendor’s breach of any of its representations and warranties set forth in
this Agreement.
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(b)
|
Licenses,
Leases and Contracts.
Vendor’s failure to observe or perform any duties or obligations to be
observed or performed on or after the applicable Services Agreement
Commencement Date by Vendor under third party licenses, equipment
leases
or other Third Party Contracts used by Vendor to provide the
Services.
|
|
(c)
|
TXUED
Data or Proprietary Information.
Vendor’s breach of its obligations with respect to TXUED Data or TXUED
Proprietary Information.
|
|
(d)
|
Infringement.
Infringement or misappropriation or alleged infringement or alleged
misappropriation of a patent, trade secret, copyright, trademark
or other
proprietary or intellectual property rights in breach of Vendor’s
representations, warranties and covenants in Sections
13.4(a)
or
13.5.
|
|
(e)
|
Government
Claims.
Claims by government regulators or agencies for fines, penalties,
sanctions, interest charges or other remedies to the extent such
fines,
penalties, sanctions, interest charges or other remedies are attributable
to Vendor’s breach of this Agreement or the wrongful acts or omissions of
Vendor or any Vendor Personnel in connection with Vendor’s performance of
the Services.
|
|
(f)
|
Taxes.
Taxes, together with interest and penalties, that are the responsibility
of Vendor under Section 10.4.
|
|
(g)
|
Other
Third Parties.
Services, products or systems (not constituting Services provided
pursuant
to this Agreement) provided by Vendor to a third
party.
|
|
(h)
|
Affiliate
or Subcontractor Claims.
Any claim initiated by (i) an Affiliate of Vendor or a Subcontractor
asserting rights arising under or relating to this Agreement other
than a
claim for which TXUED is obligated to indemnify Vendor under this
Agreement, or (ii) any entity to which Vendor assigned, transferred,
pledged, hypothecated or otherwise encumbered its rights to receive
payments from TXUED under this Agreement without TXUED’s
consent.
|
|
(i)
|
Vendor
Personnel Injury Claims.
Any claim by Vendor Personnel for death or bodily injury suffered
at an
TXUED Facility other than claims for death or bodily injury caused
by any
act, omission, fault, negligence or gross negligence by
TXUED.
|
|
(j)
|
Employment
Claims. Any
claim (including claims by current or former TXUED employees, including
Transitioned Employees) relating to any (i) violation by Vendor or
its officers, directors, employees, representatives or agents, of
any Laws
or any common Law protecting persons or members of protected classes
or
categories, including Laws prohibiting discrimination or harassment
on the
basis of a protected characteristic, (ii) liability arising or
resulting from the employment of Vendor Personnel (including Transitioned
Employees) by Vendor (including liability for any social security
or other
employment taxes, workers’ compensation claims and premium payments, and
contributions applicable to the wages and salaries of such Vendor
Personnel), (iii) payment or failure to pay any salary, wages or
other cash compensation due and owing to any Vendor Personnel (including
Transitioned Employees from and after their Employment Effective
Dates),
(iv) employee pension or other benefits of any Vendor Personnel
(including Transitioned Employees) accruing from and after their
Employment Effective Date, (v) other aspects of the employment
relationship of Vendor Personnel (including Transitioned Employees)
with
Vendor or the termination of such relationship, including claims
for
wrongful discharge, claims for breach of express or implied employment
contract and claims of joint employment and/or (vi) liability
resulting from representations (oral or written) to the TXUED employees
identified on Schedule M
to
the applicable Services Agreement by Vendor (or its respective officers,
directors, employees, representatives or agents), or other acts or
omissions with respect to the TXUED employees identified on Schedule M
to
the applicable Services Agreement by such persons or entities, including
any act, omission or representation made in connection with the interview,
selection, hiring and/or transition process, the offers of employment
made
to such employees, the failure to make offers to any such employees
or the
terms and conditions of such offers (including compensation and employee
benefits), except, in each case, to the extent arising out of: (i)
any
act, omission, fault or neglect of TXUED or TXUED Third Party Contractors,
(ii) errors or inaccuracies in the information provided by TXUED
and
faithfully communicated by Vendor or (iii) the failure of TXUED or
TXUED
Third Party Contractors to comply with TXUED’s responsibilities under this
Agreement.
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(k)
|
Vendor
Acts and Omissions.
Wrongful acts or omissions (including Vendor’s or any Vendor Personnel’s
negligence and gross negligence) of Vendor or any Vendor Personnel
in
connection with Vendor’s performance of the
Services.
|
|
(l)
|
Reserved.
|
|
(m)
|
Vendor
Personnel Injury Claims. Any
claims by Vendor employees for death or bodily injury suffered at
an TXUED
Facility or in their performance of services as Seconded Vendor Personnel
other than claims for death or bodily injury caused by any act, omission,
fault, negligence or gross negligence by TXUED or TXUED Third Party
Contractors.
|
|
(n)
|
Tort
Claims for Acts or Omissions of Seconded Vendor Personnel.
Any
tort claims brought by third parties for Losses caused by any act,
omission, fault or negligence by Seconded Vendor Personnel in their
performance of services, other than claims arising from or in connection
with (i) Seconded Vendor Personnel following instructions from TXUED
or
(ii) any act, omission, fault, negligence or gross negligence by
TXUED.
|
IT
IS THE EXPRESS INTENT OF THE PARTIES THAT, FOR PURPOSES OF THIS
SECTION
15.1,
LOSSES AND VENDOR’S OBLIGATION TO INDEMNIFY, DEFEND AND HOLD HARMLESS SHALL
INCLUDE LOSSES DUE TO THIRD PARTY CLAIMS ARISING FROM OR IN CONNECTION WITH
TXUED’S CONCURRENT NEGLIGENCE. IN THE CASE OF CONTRIBUTORY NEGLIGENCE, LIABILITY
WILL BE APPORTIONED BETWEEN THE PARTIES IN ACCORDANCE WITH EACH PARTY’S
RESPECTIVE FAULT AS DETERMINED BY A COURT OF COMPETENT
JURISDICTION.
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15.2
|
Indemnity
by TXUED.
TXUED agrees to indemnify, defend and hold harmless Vendor and its
officers, directors, employees, agents, representatives, successors
and
assigns from and against any and all Losses due to third party claims
(excluding the claims of Vendor’s Affiliates and
Subcontractors) arising
from or in connection with any of the
following:
|
|
(a)
|
Representations
and Warranties.
TXUED’s breach of any of its representations and warranties set forth in
this Agreement.
|
|
(b)
|
Licenses,
Leases or Contracts.
TXUED’s failure to observe or perform any duties or obligations to be
observed or performed by TXUED under any of the applicable third
party
licenses, equipment leases or Third Party Contracts to the extent
TXUED is
financially or operationally responsible under this
Agreement.
|
|
(c)
|
Vendor’s
Proprietary Information.
TXUED's breach of its obligations with respect to Vendor’s Proprietary
Information.
|
|
(d)
|
Infringement.
Infringement or misappropriation or alleged infringement or alleged
misappropriation of a patent, trade secret, trademark, copyright
or other
proprietary or intellectual property rights in contravention of TXUED’s
representations, warranties and covenants in Section 13.5.
|
|
(e)
|
Taxes.
Taxes, together with interest and penalties (other than interest
or
penalties resulting from Vendor’s failure to timely notify TXUED of Taxes
due as required under Section
10.4),
that are the responsibility of TXUED under Section 10.4.
|
|
(f)
|
Government
Claims.
Claims by government regulators or agencies for fines, penalties,
sanctions, interest charges or other remedies to the extent such
fines,
penalties, sanctions, interest charges or other remedies are attributable
to TXUED's breach of this
Agreement.
|
|
(g)
|
TXUED
Affiliate, Eligible Recipient or Third Party Contractor
Claims.
Any claim, initiated by an Affiliate of TXUED, an Eligible Recipient
(other than TXUED) or an TXUED Third Party Contractor asserting rights
arising under or relating to this Agreement, other than a claim for
which
Vendor is obligated to indemnify TXUED under this
Agreement.
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(h)
|
Employment
Claims.
Any claim (including claims by current or former TXUED employees,
including Transitioned Employees) relating to (i) violation by TXUED
or its officers, directors, employees, representatives or agents
of any
Laws or any common Law protecting persons or members of protected
classes
or categories, including Laws prohibiting discrimination or harassment
on
the basis of a protected characteristic, (ii) liability arising or
resulting from the employment of persons (including Transitioned
Employees
prior to their Employment Effective Date) by TXUED, (iii) payment or
failure to pay any salary, wages or other cash compensation due and
owing
to any employee of TXUED (including Transitioned Employees prior
to their
Employment Effective Dates), (iv) employee pension or other benefits
of any employee of TXUED (including Transitioned Employees prior
to their
Employment Effective Dates), (v) other aspects of the employment
relationship of any employee of TXUED (including Transitioned Employees
prior to their Employment Effective Dates and provided, in no event
will
TXUED be liable for any claim related to a Transitioned Employee’s
employment relationship arising on or after such Transitioned Employee’s
Employment Effective Date regardless of a finding by any court or
authoritative body that TXUED is or was an employer of such Transitioned
Employee on or after his or her Employment Effective Date) and/or
(vi) liability resulting from any representations (oral or written)
to the TXUED employees identified on Schedule M
to
the applicable Services Agreement by TXUED (or its officers, directors,
employees, representatives or agents), or other acts of TXUED prior
to the
applicable Employment Effective Date in connection with the selection
and
hiring by Vendor of the TXUED employees identified on Schedule M
to
the applicable Services Agreement, except, in each case, to the extent
arising out of (i) any act, omission, fault or neglect of Vendor
(or its
officers, directors, employees, representatives or agents), (ii)
errors or
inaccuracies in the information provided by Vendor and faithfully
communicated by TXUED, or (iii) the failure of Vendor (or its officers,
directors, employees, representatives or agents) to comply with Vendor’s
responsibilities under this Agreement.
|
|
(i)
|
TXUED
Personnel Injury Claims. Any
claims by TXUED Personnel for death or bodily injury suffered at
a Vendor
Facility or in their performance of Services as Seconded TXUED Personnel
other than claims for death or bodily injury caused by any act, omission,
fault, negligence or gross negligence by
Vendor.
|
|
(j)
|
Tort
Claims for Acts or Omissions of Seconded TXUED Personnel.
Any
tort claims brought by third parties for Losses caused by any act,
omission, fault or negligence by Seconded TXUED Personnel in their
performance of Services, other than claims arising from or in connection
with (i) Seconded TXUED Personnel following instructions from Vendor
or
(ii) any act, omission, fault, negligence or gross negligence by
Vendor.
|
IT
IS THE EXPRESS INTENT OF THE PARTIES THAT, FOR PURPOSES OF THIS
SECTION
15.2,
LOSSES AND TXUED’S OBLIGATION TO INDEMNIFY, DEFEND AND HOLD HARMLESS SHALL
INCLUDE LOSSES DUE TO THIRD PARTY CLAIMS ARISING FROM OR IN CONNECTION WITH
VENDOR’S CONCURRENT NEGLIGENCE. IN THE CASE OF CONTRIBUTORY NEGLIGENCE,
LIABILITY WILL BE APPORTIONED BETWEEN THE PARTIES IN ACCORDANCE WITH EACH
PARTY’S RESPECTIVE FAULT AS DETERMINED BY A COURT OF COMPETENT
JURISDICTION.
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15.3
|
Reserved.
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|
15.4
|
Indemnification
Procedures.
With respect to claims which are subject to indemnification under
this
Agreement (other than as provided in Section 15.5
with respect to claims covered by Section 15.1(e)
and Section 15.2(f)),
the following procedures shall
apply:
|
|
(a)
|
Notice.
Promptly after receipt by any entity entitled to indemnification
under
this Agreement of notice of the commencement or threatened commencement
of
any civil, criminal, administrative, or investigative action or proceeding
involving a claim in respect of which the indemnitee will seek
indemnification hereunder, the indemnitee shall notify the indemnitor
of
such claim. No delay or failure to so notify an indemnitor shall
relieve
it of its obligations under this Agreement except to the extent that
such
indemnitor has suffered actual prejudice by such delay or failure.
Within
forty-five (45) days following receipt of notice from the indemnitee
relating to any claim, but no later than five (5) days before the
date on
which any response to a complaint or summons is due, the indemnitor
shall
notify the indemnitee that the indemnitor elects to assume control
of the
defense and settlement of that claim (a “Notice
of Election”).
|
|
(b)
|
Procedure
Following Notice of Election. If
the indemnitor delivers a Notice of Election within the required
notice
period, the indemnitor shall assume control (subject to indemnities
right
to participate at its own expense) over the defense and settlement
of the
claim; provided, however, that (i) the indemnitor shall keep the
indemnitee reasonably apprised at all times as to the status of the
defense, and (ii) the indemnitor shall obtain the prior written
approval of the indemnitee before entering into any settlement of
such
claim asserting any liability against the indemnitee or imposing
any
liability, obligation or restriction on the indemnitee or ceasing
to
defend against such claim. The indemnitor shall not be liable for
any
legal fees or expenses incurred by the indemnitee following the delivery
of a Notice of Election; provided, however, that to the extent permissible
under applicable Law and to the extent that such conduct does or
would
not, or is not reasonably likely to, result in the waiver or of
abandonment of legal privilege are in whole or in part, (i) the
indemnitee shall be entitled to employ counsel at its own expense
to
participate in the handling of the claim and (ii) the indemnitor
shall pay the fees and expenses associated with such counsel if,
in the
reasonable judgment of the indemnitee based on a written opinion
of
counsel, there is a conflict of interest with respect to such claim
which
is not otherwise resolved or if the indemnitor has requested the
assistance of the indemnitee in the defense of the claim or the indemnitor
has failed to defend the claim diligently. The indemnitor shall not
be
obligated to indemnify the indemnitee for any amount paid or payable
by
such indemnitee in the settlement of any claim if (i) the indemnitor
has delivered a timely Notice of Election and such amount was agreed
to
without the written consent of the indemnitor, (ii) the indemnitee
has not provided the indemnitor with notice of such claim and a reasonable
opportunity to respond thereto or (iii) the time period within which
to deliver a Notice of Election has not yet
expired.
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(c)
|
Procedure
Where No Notice of Election Is Delivered.
If the indemnitor does not deliver a Notice of Election relating
to any
claim within the required notice period, the indemnitee shall have
the
right to defend the claim in such reasonable manner as it may deem
appropriate subject to the terms of this Agreement. The indemnitor
shall
promptly reimburse the indemnitee for all such reasonable costs and
expenses incurred by the indemnitee, including reasonable attorneys’
fees.
|
|
15.5
|
Indemnification
Procedures - Governmental Claims.
With respect to claims covered by Section 15.1(e)
or
Section
15.2(f),
the following procedures shall
apply:
|
|
(a)
|
Notice.
Promptly after receipt by an indemnitee of notice of the commencement
or
threatened commencement of any action or proceeding involving a claim
in
respect of which the indemnitee will seek indemnification pursuant
to
Section 15.1(e)
or
Section
15.2(f),
the indemnitee shall notify the indemnitor of such claim. No delay
or
failure to so notify the indemnitor shall relieve the indemnitor
of its
obligations under this Agreement except to the extent that the indemnitor
has suffered actual prejudice by such delay or
failure.
|
|
(b)
|
Procedure
for Defense.
The indemnitee shall be entitled, at its option, to have the claim
handled
pursuant to Section 15.4
or
to retain sole control over the defense and settlement of such claim;
provided that, the indemnitee shall (i) keep the indemnitor reasonably
appraised as to the status of the defense, (ii) consult with the
indemnitor on a regular basis regarding claim processing (including
actual
and anticipated costs and expenses) and litigation strategy,
(iii) obtain prior written approval of the indemnitor before entering
any indemnitor settlement proposals or suggestions and (iv) use
commercially reasonable efforts to minimize any amounts payable or
reimbursable by the indemnitor.
|
|
16.
|
LIABILITY
|
|
16.1
|
Force
Majeure.
|
|
(a)
|
General.
Subject to Section 16.1(d),
no Party shall be liable for any default or delay in the performance
of
its obligations under this Agreement if and to the extent such default
or
delay is caused by fire, earthquake, acts of God, wars, riots, civil
disorders, rebellions or revolutions, acts of terrorism, strikes,
lockouts, labor disputes, inter-carrier telecommunications backbone
failures, or any other similar cause beyond the reasonable control
of such
Party, except to the extent that the non-performing Party is at fault
in
failing to prevent or causing such default or delay, and provided
that
such default or delay cannot be, or could not have been, reasonably
circumvented by the non-performing Party through the use of reasonable
alternate sources, workaround plans or other means. Notwithstanding
anything to the contrary in this Section: (i) strikes, lockouts or
labor
disputes involving Vendor (including Vendor Personnel) that are not
of a
widespread nature involving both Vendor and third parties, the failure
by
a Subcontractor to provide or perform any goods or services to Vendor
(other than to the extent attributable to a force majeure event as
described in the first sentence of this Subsection) or the breach
by a
Subcontractor of any of its obligations to Vendor shall not constitute
force majeure events under this Agreement; and (ii) rain, snow, ice,
wind,
heat or other adverse weather conditions that could not have been
reasonably expected or anticipated (“Weather
Events”)
shall constitute force majeure events under this Agreement with respect
to
Vendor, provided that the occurrence of any Weather Event shall only
excuse Vendor’s performance under this Agreement to the extent (A) any
such failure cannot be, or could not have been, reasonably circumvented
by
Vendor through the use of reasonable alternate sources, workaround
plans
or other means, and (B) Vendor uses and continues to use its best
efforts
to promptly resume performance of the Services in accordance with
this
Agreement.
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(b)
|
Duration
and Notification.
Upon the occurrence and during the continuance of such force majeure
event
the non-performing Party shall be excused from further performance
or
observance of the obligation(s) so affected for as long as such
circumstances prevail and such Party continues to use commercially
reasonable efforts to recommence performance or observance whenever
and to
whatever extent possible without delay. Any Party prevented, hindered
or
delayed in its performance of its obligations under this Agreement
as a
result of any force majeure event shall, as quickly as practicable
under
the circumstances, notify the Party to whom performance is due by
telephone (to be confirmed in writing within two (2) days of the
inception
of such delay) and describe at a reasonable level of detail the
circumstances of the force majeure event, the steps being taken to
address
such force majeure event, and the expected duration of such force
majeure
event.
|
|
(c)
|
*** |
|
***
|
CONFIDENTIAL MATERIAL REDACTED AND FILED
SEPARATELY WITH THE COMMISSION.
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(d)
|
Business
Continuity and Disaster Recovery.
Vendor shall (i) develop and submit to TXUED for TXUED’s review as soon as
reasonably practicable after the applicable Services Agreement Effective
Date (but in any event within one hundred twenty (120) days following
the
applicable Services Agreement Commencement Date), and upon TXUED’s
approval institute a business continuity and a disaster recovery
plan for
the Services provided under each Services Agreement, (ii) periodically
update and test the operability of the business continuity and disaster
recovery plans during every twelve (12) month period that each business
continuity plan and disaster recovery plan is fully operational,
(iii)
submit to TXUED for TXUED’s review and approval any material updates or
other changes to the business continuity and disaster recovery plans
and
(iv) certify to TXUED at least every twelve (12) months that the
business
continuity and disaster recovery plans are fully operational. Upon
the
occurrence of a force majeure event, Vendor shall implement promptly,
as
appropriate, the applicable business continuity or disaster recovery
plan
and provide business continuity or disaster recovery Services. The
occurrence of a force majeure event shall not relieve Vendor of its
obligation to implement, as appropriate, the applicable business
continuity or disaster recovery plan and provide business continuity
or
disaster recovery Services.
|
|
(e)
|
Payment
Obligation.
If Vendor fails to provide Services in accordance with this Agreement
due
to the occurrence of a force majeure event, all amounts payable to
Vendor
hereunder shall be equitably adjusted in a manner such that TXUED
is not
required to pay any amounts for Services that it is not
receiving.
|
|
(f)
|
Allocation
of Resources.
Without limiting Vendor’s obligations under this Agreement, whenever a
force majeure event or disaster causes Vendor to allocate limited
resources between or among Vendor’s customers and its or their Affiliates,
Vendor shall not provide to any other customers or its or their Affiliates
priority over TXUED. In no event will Vendor unreasonably re-deploy
or
re-assign any Key Vendor Personnel to TXUED's material detriment
to
another customer or account in the event of the occurrence of a force
majeure event or any other event.
|
|
16.2
|
Limitation
of Liability.
|
|
(a)
|
EXCEPT
WHERE THIS AGREEMENT EXPRESSLY PROVIDES FOR ANY LIQUIDATED FORM OF
DAMAGES
(WHICH THE PARTIES EXPRESSLY AGREE ARE ENFORCEABLE), NEITHER PARTY
SHALL
BE LIABLE TO THE OTHER PARTY FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL,
COLLATERAL, EXEMPLARY OR PUNITIVE DAMAGES, INCLUDING LOST PROFITS,
REGARDLESS OF THE FORM OF THE ACTION OR THE THEORY OF RECOVERY, EVEN
IF
SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES.
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(b)
|
EXCEPT
AS EXPRESSLY PROVIDED IN SECTION
16.2(C),
THE TOTAL AGGREGATE LIABILITY OF EITHER PARTY, FOR ALL CLAIMS ASSERTED
BY
THE OTHER PARTY UNDER OR IN CONNECTION WITH THIS AGREEMENT, REGARDLESS
OF
THE FORM OF THE ACTION OR THE THEORY OF RECOVERY, SHALL BE LIMITED
TO THE
PRODUCT OF (i) THE AGGREGATE TOTAL CHARGES PAID UNDER ALL OF THE
SERVICES
AGREEMENTS FOR THE TWELVE (12) MONTH PERIOD PRECEDING THE ACT OR
OMISSION
GIVING RISE TO SUCH LIABILITY OR, IN THE EVENT CHARGES HAVE NOT BEEN
PAID
FOR TWELVE (12) MONTHS UNDER THE INITIAL SERVICES AGREEMENT, AN AMOUNT
EQUAL TO TWELVE (12) TIMES THE AGGREGATE TOTAL CHARGES PAID UNDER
THE
INITIAL SERVICES AGREEMENT IN THE MONTH PRECEDING SUCH ACT OR OMISSION,
MULTIPLIED BY (ii) TEN PERCENT (10%) (“DAMAGES
CAP”).
AT THE END OF EACH CONTRACT YEAR THE DAMAGES CAP SHALL BE RESET TO
AN
AMOUNT EQUAL TO THE PRODUCT OF (1) THE AGGREGATE TOTAL CHARGES PAID
UNDER
THIS AGREEMENT DURING SUCH CONTRACT YEAR MULTIPLIED BY (2) TEN PERCENT
(10%).
|
|
(c)
|
Exceptions
to Limitations of Liability.
The limitations and exculpations of liability set forth in Section 16.2(a)
and Section
16.2(b)
shall not apply with respect to:
|
|
(i)
|
Losses
occasioned by: the willful misconduct of a Party, fraud of a Party
or
gross negligence of senior management of a Party; TXUED’s willful failure
to pay undisputed Charges owed but not paid to Vendor hereunder (including
TXUED’s obligations for payments under Sections
1.2(b),
(c)
and (f)
and Section
18.9);
Vendor’s willful failure to provide TXUED with any undisputed Service
Level Credits, credits appearing on invoices and credits under
Exhibit
11
to
the Services Agreements owed TXUED; or either Party’s willful repudiation
or willful refusal to perform all or any portion of this Agreement
(including the Termination Assistance
Services).
|
|
(ii)
|
Amounts
paid with respect to third party claims that are the subject of
indemnification under this Agreement, including under Section 15.1
and Section
15.2.
|
|
(d)
|
Acknowledged
Direct Damages.
The Parties acknowledge that Service Level Credits and amounts paid
by a
Party to a third party that are the subject of indemnification under
this
Agreement shall be considered direct damages under this
Agreement.
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(e)
|
Items
Not Considered Damages.
The following shall not be considered damages subject to Section
16.2(a),
and shall not be counted toward the liability cap specified in
Section
16.2(b):
|
|
(i)
|
Amounts
withheld by TXUED in accordance with this Agreement due to (and in
the
amount of any) incorrect Charges by
Vendor.
|
|
(ii)
|
Amounts
paid by TXUED but subsequently recovered from Vendor due to (and
in the
amount of any) incorrect Charges by
Vendor.
|
|
(iii)
|
Invoiced
Charges and other amounts that are due and owing to Vendor for Services
under this Agreement.
|
|
16.3
|
Non-Recourse
Liabilities.
The obligations of each Party under this Agreement shall be satisfied
solely from the assets of such Party, and such obligations shall
in all
cases be non-recourse to any of the directors, officers, shareholders,
partners (whether limited or general), members, employees, agents
or
Affiliates of such Party.
|
|
17.
|
DISPUTE
RESOLUTION
|
|
17.1
|
Informal
Dispute Resolution.
Prior to the initiation of formal dispute resolution procedures with
respect to any dispute (including arbitration proceedings with respect
to
any Arbitrable Dispute), other than as provided in the last sentence
of
Section 17.1(c),
or in Section
17.1(e)
or
Section 18.11,
the Parties shall first attempt to resolve such dispute informally,
as
follows:
|
|
(a)
|
Initial
Effort.
The Parties agree to initially attempt to resolve all disputes at
the
operational level, beginning with the applicable Joint Working Group,
with
escalation of unresolved disputes to the Operational Governance Board
and
then to the Executive Governance Board, as applicable. Any disputes
that
are not resolved by the Executive Governance Board shall be escalated
to
the TXUED Account Executive and the Vendor Account Executive, and
the
TXUED Account Executive and the Vendor Account Executive shall attempt
in
good faith to resolve all such disputes. In the event the TXUED Account
Executive and the Vendor Account Executive are unable to resolve
a dispute
within fourteen (14) days, either Party may refer the dispute for
resolution to the senior corporate executives specified in Section 17.1(b)
upon written notice to the other
Party.
|
|
(b)
|
Escalation.
Within five (5) days of a notice under Section 17.1(a)
referring a dispute for resolution to the senior corporate executives,
the
Vendor Account Executive will prepare and provide to Vendor’s chief
executive officer or his or her designee and the TXUED Account Executive
will prepare and provide to a member of senior management of TXUED
summaries of the non-privileged relevant information and background
of the
dispute, along with any appropriate non-privileged supporting
documentation, for their review. The designated senior corporate
executives will confer as often as they deem reasonably necessary
in order
to gather and furnish to the other all non-privileged information
with
respect to the matter in issue which the Parties believe to be appropriate
and germane in connection with its resolution. The designated senior
corporate executives shall discuss the problem and negotiate in good
faith
in an effort to resolve the dispute without the necessity of any
formal
proceeding. The specific format for the discussions will be left
to the
discretion of the designated senior corporate executives, but may
include
the preparation of agreed-upon statements of fact or written statements
of
position.
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(c)
|
Prerequisite
to Formal Proceedings.
Formal proceedings for the resolution of a dispute (including arbitration
proceedings with respect to any Arbitrable Dispute) may not be commenced
until the earlier of:
|
|
(i)
|
the
designated senior corporate executives under Section 17.1(b)
concluding in good faith that amicable resolution through continued
negotiation of the matter does not appear likely;
and
|
|
(ii)
|
thirty
(30) days after the initial notice under Section 17.1(a)
referring the dispute to the senior corporate
executives.
|
The
provisions and time periods specified in this Section 17.1
shall
not be construed to prevent a Party from instituting, and a Party is authorized
to institute, formal proceedings earlier to (A) avoid the expiration of any
applicable limitations period, (B) preserve a superior position with
respect to other creditors or (C) address a dispute arising out of or
relating to Section 4.2
or
Article 12
or a
dispute subject to Section 18.11.
|
(d)
|
Arbitrable
Disputes.
Subject to Section
17.1(e),
the Parties agree that any Arbitrable Dispute shall be submitted
by the
Parties to final and binding arbitration under and in accordance
with the
following procedures:
|
|
(i)
|
Any
arbitration proceedings conducted in respect of an Arbitrable Dispute
shall be conducted pursuant to the American Arbitration Association
Commercial Arbitration Rules, Title 9 of the U.S. Code and the Texas
Arbitration Act, provided that the Parties agree that the American
Arbitration Association shall not administer any such arbitration.
Judgment on the ruling, finding or award rendered by the arbitrator(s)
may
be entered in the courts of Dallas County, Texas and/or the United
States
District Court for the Northern District of Texas (Dallas Division).
Any
challenge to any such ruling, finding or award shall be filed in,
and each
Party agrees not to remove or transfer such action from, the courts
of
Dallas County, Texas or the United States District Court for the
Northern
District of Texas (Dallas
Division).
|
|
(ii)
|
Within
ten (10) days after the end of the time period specified in Section
17.1(c)(ii),
the Parties shall, if they can agree, select an arbitrator to resolve
the
Arbitrable Dispute. In the event that the Parties have not selected
an
arbitrator within ten (10) days of the end of the time period specified
in
Section
17.1(c)(ii),
then the Arbitrable Dispute shall be resolved by majority decision
of a
panel of three (3) arbitrators, one (1) selected by each Party and
the
third selected by the two (2) Party-selected arbitrators, which the
Parties agree to instruct such arbitrators to
make.
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(iii)
|
Each
Party shall provide to the arbitrator(s) in writing a statement of
fact or
statement of position and a proposal for resolution of the Arbitrable
Dispute (each, a “Proposal”).
At any time prior to the close of the arbitration proceeding, the
Parties
may exchange revised Proposals, which shall also be provided to the
arbitrator(s). In rendering the ruling, finding or award, the
arbitrator(s) shall choose either (A) the last Proposal submitted
by TXUED
or (B) the last Proposal submitted by Vendor, and shall select one
or the
other of such Proposals that the arbitrator(s) find(s) most reasonable
and
appropriate in light of the facts found at the arbitration proceeding
(subject to clause (v) of this Subsection). No written statement
of
reasons shall accompany the ruling, finding or
award.
|
|
(iv)
|
The
place of arbitration shall be Dallas,
Texas.
|
|
(v)
|
The
arbitrator(s) shall have no authority to award punitive damages or
any
other damages not measured by the prevailing Party’s actual, direct
damages, and may not, in any event, make any ruling, finding or award
that
does not conform to the terms and conditions of this
Agreement.
|
|
(vi)
|
Except
as required by Law, unless otherwise agreed by the Parties neither
Party
shall disclose or disseminate any information relating to any arbitration
proceedings conducted pursuant to this Subsection except for disclosure
to
those of its officers, employees, accountants, attorneys and agents
whose
duties reasonably require them to have access to such
information.
|
|
(vii)
|
The
Parties shall share equally the costs and expenses of any arbitration
proceedings conducted pursuant to this Subsection. Each Party shall
otherwise bear its own fees and expenses in respect of any arbitration
proceedings conducted pursuant to this
Subsection.
|
|
(viii)
|
Notwithstanding
anything to the contrary in this Subsection, the Parties may agree
in lieu
of arbitration to have an individual or individuals having expertise
regarding the nature of an Arbitrable
Dispute,
such as independent accountants or independent engineers (a “Qualified
Expert”
or the “Qualified
Experts”)
to finally resolve such Arbitrable Dispute in accordance with the
terms of
this clause and clauses (iii) through (vii) of this Subsection. If
the
Parties agree to resolve any Arbitrable Dispute under this clause
(viii),
then within ten (10) days after the end of the time period specified
in
Section
17.1(c)(ii),
the Parties shall, if they can agree, select a Qualified Expert to
resolve
such Arbitrable Dispute. In the event that the Parties have not selected
a
Qualified Expert within ten (10) days of the end of the time period
specified in Section
17.1(c)(ii),
then the Arbitrable Dispute shall be resolved by arbitration as set
forth
in this Section
17.1(d).
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(e)
|
Exceptions.
For the avoidance of doubt, any disputes arising out of or related
to this
Agreement that are not Arbitrable Disputes are not subject to final
and
binding arbitration in accordance with Section
17.1(d).
In addition, any Arbitrable Disputes that address a dispute arising
out of
or relating to Section 4.2
or
Article 12
or
a dispute subject to Section 18.11
shall not be subject to final and binding arbitration in accordance
with
Section
17.1(d).
|
|
17.2
|
Jurisdiction.
Each Party irrevocably agrees that any legal claim, action, suit
or
proceeding brought by it in any way arising out of this Agreement
(including any action for enforcement of an arbitration award) must
be
brought solely and exclusively in the courts of Dallas County, Texas
and/or the United States District Court for the Northern District
of Texas
(Dallas Division), and each Party irrevocably submits to the sole
and
exclusive jurisdiction of the state and federal courts in Dallas
County,
Texas in personam, generally and unconditionally with respect to
any
action, suit or proceeding brought by it or against it by the other
Party,
and the Parties agree that they will not raise any defense or objection
or
file any motion based on lack of personal jurisdiction, improper
venue,
inconvenience of the forum or the like in any action, suit or proceeding
filed in a state or federal court in Dallas County,
Texas.
|
|
17.3
|
Continued
Performance.
Subject to Section
16.1
regarding force majeure events, each Party agrees that it shall,
unless
otherwise directed by the other Party, continue performing its obligations
under this Agreement while any dispute is being resolved; provided,
that
this provision shall not operate or be construed as extending the
Term or
prohibiting or delaying a Party’s exercise of any right it may have to
terminate this Agreement in accordance with this Agreement. For the
avoidance of doubt, TXUED Data may not be withheld by Vendor pending
the
resolution of any dispute.
|
|
17.4
|
Governing
Law.
This Agreement and performance under it shall be governed by and
construed
in accordance with the applicable Laws of the State of Texas,
without giving effect to any choice or conflicts of Law provision
or rule
(whether of the State of Texas or any other jurisdiction) that would
cause
the application of the Laws of any other jurisdiction other than
the State
of Texas. The Parties mutually agree that this Agreement is a “Major
Transaction” within the meaning of the Texas Civil Practice and Remedies
Code, Section 15.020, and as such agree that any action, suit or
proceeding in any way arising out of this Agreement shall be brought
in
the state or federal courts in Dallas County, Texas, and venue shall
be in
the state or federal courts in Dallas County, Texas. The application
of
the United Nations Convention on Contracts for the International
Sale of
Goods is expressly excluded.
|
|
18.
|
TERMINATION
|
|
18.1
|
Termination
for Cause.
|
|
(a)
|
By
TXUED.
If Vendor:
|
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(i)
|
commits
a material breach of this Master Agreement, which breach is not cured
within forty-five (45) days after notice of the breach from TXUED;
provided that such forty-five (45) day period shall be extended for
up to
one-hundred thirty-five (135) additional days so long as Vendor has
commenced and is diligently using and continues to use its best efforts
to
cure such breach and the failure to cure such breach does not have
a
material adverse effect on TXUED (which, for the avoidance of doubt,
excludes those effects that have been cured by payment of money damages);
|
|
(ii)
|
commits
a material breach of this Master Agreement which is not capable of
being
cured (including with the payment of money damages, when appropriate)
within the period specified pursuant to Section 18.1(a)(i);
|
|
(iii)
|
commits
numerous breaches of this Master Agreement of which Vendor has received
formal notice and which collectively constitute a material breach,
and
fails to (A) cure such breaches within forty-five (45) days after
receiving notice from TXUED that such breaches have become a material
breach (provided that such forty-five (45) day period shall be extended
for up to one-hundred thirty-five (135) additional days so long as
Vendor
has commenced and is diligently using and continues to use its best
efforts to cure such breach and the failure to cure such breach does
not
have a material adverse effect on TXUED (which, for the avoidance
of
doubt, excludes those effects that have been cured by payment of
money
damages)) and (B) give TXUED adequate assurance that the cause of
each of
such breaches has been corrected so as not to be repeated again,
provided
that if, within the twenty-four (24) month period following the completion
of the cure described in the preceding clause (A), Vendor again commits
numerous breaches of this Master Agreement of which Vendor has previously
received formal notice and which collectively constitute a material
breach, Vendor shall not be entitled to the cure rights described
in the
preceding clauses (A) and (B); or
|
|
(iv)
|
commits
a breach of Section
4.1(e),
which breach is not cured within forty-five (45) days after notice
of the
breach from TXUED;
|
then
TXUED may, by giving notice to Vendor, terminate this Agreement as of a date
specified in the notice of termination.
|
(b)
|
By
Vendor.
In the event that (i) TXUED fails to pay Vendor any undisputed portion
of
any Bi-Monthly Invoice within fifteen (15) days following notice
from
Vendor and TXUED continues to fail to pay Vendor within fifteen (15)
days
following a second notice from Vendor (to be delivered no earlier
than
fifteen (15) days after the first notice) stating that such amount
is
overdue and stating that Vendor may, in Vendor’s sole discretion,
terminate the Agreement if such amount is not paid within three (3)
days
from the date of such second notice or (ii) in any calendar year,
TXUED
fails to pay the undisputed portion of five (5) or more Bi-Monthly
Invoices within the time period set forth in Section 11.1(b) and
has
received at least one notice from Vendor in respect of each such
failure
to pay.
|
Page
59 of
67
AMENDED
AND RESTATED
MASTER
AGREEMENT
|
18.2
|
Reserved.
|
|
18.3
|
Termination
for Insolvency.
In the event that a Party (i) files for bankruptcy, (ii) becomes
or is declared insolvent, or is the subject of any bona fide proceedings
related to its liquidation, administration, provisional liquidation,
insolvency that is not dismissed within sixty (60) days, or the
appointment of a receiver or similar officer for it, (iii) passes a
resolution for its voluntary liquidation, (iv) has a receiver or
manager appointed over all or substantially all of its assets,
(v) makes an assignment for the benefit of all or substantially all
of its creditors, (vi) enters into an agreement or arrangement for
the composition, extension, or readjustment of substantially all
of its
obligations or any class of such obligations, (vii) has its credit
rating issued by one or more Ratings Agencies downgraded to or below
“CCC”
or their equivalent grade in the event of a change in rating scales
by the
Rating Agencies (provided that until Vendor obtains a credit rating,
this
clause (vii) shall not be a basis upon which TXUED may terminate
this
Agreement), or (viii) experiences an event analogous to any of the
foregoing in any jurisdiction in which any of its assets are situated,
then in any such event the other Party may terminate this Agreement
as of
a date specified in a termination notice; provided, however, that
Vendor
shall not have the right to exercise such termination under this
Section
so long as TXUED pays for the Services on a current basis. For purposes
of
this Section, “Ratings Agency” means each of Xxxxx’x Investor Services or
Standard & Poors and any successors thereto, and in the event either
of such Entities no longer issues credit ratings, then another nationally
recognized credit rating agency (if any) agreed to by the
Parties.
|
|
18.4
|
TXUED
Rights Upon Vendor’s Bankruptcy.
|
|
(a)
|
General
Rights.
In the event of Vendor’s bankruptcy or other formal procedure referenced
in Section 18.3
or
of the filing of any petition under bankruptcy Laws affecting the
rights
of Vendor which is not stayed or dismissed within thirty (30) days
of
filing, in addition to the other rights and remedies set forth herein,
to
the maximum extent permitted by Law, TXUED will have the immediate
right
to retain and take possession for safekeeping all TXUED Data, TXUED
Proprietary Information, TXUED licensed Materials, TXUED owned equipment,
TXUED owned systems, TXUED owned Materials, Work Product and all
other
Resources to which TXUED is or would be entitled during the Term
or upon
the expiration or termination of this Agreement. Vendor shall cooperate
fully with TXUED and assist TXUED in identifying and taking possession
of
the items listed in the preceding sentence. TXUED will have the right
to
hold such TXUED Data, Proprietary Information and Resources until
such
time as the trustee or receiver in bankruptcy or other appropriate
insolvency office holder can provide adequate assurances and evidence
to
TXUED that they will be protected from sale, release, inspection,
publication, or inclusion in any publicly accessible record, document,
material or filing. Vendor and TXUED agree that without this material
provision, TXUED would not have entered into this Agreement or provided
any right to the possession or use of TXUED Data, Proprietary Information,
or Resources covered by this
Agreement.
|
Page
60 of
67
AMENDED
AND RESTATED
MASTER
AGREEMENT
|
(b)
|
TXUED
Rights in Event of Bankruptcy Rejection.
Notwithstanding any other provision of this Agreement to the contrary,
in
the event that Vendor becomes a debtor under the United States Bankruptcy
Code (11 U.S.C. §101 - 1330 as amended (the “Bankruptcy
Code”))
and rejects this Agreement pursuant to Section 365 of the Bankruptcy
Code (a “Bankruptcy
Rejection”),
(i) any and all of the licensee and sublicensee rights of TXUED
arising under or otherwise set forth in this Agreement, including
the
rights of TXUED referred to in the Services Agreements, shall be
deemed
fully retained by and vested in TXUED as protected intellectual property
rights under Section 365(n)(1)(B) of the Bankruptcy Code and further
shall be deemed to exist immediately before the commencement of the
bankruptcy case in which Vendor is the debtor, (ii) TXUED shall have
all of the rights afforded to non-debtor licensees and sublicensees
under
Section 365(n) of the Bankruptcy Code; and (iii) to the extent
any rights of TXUED under this Agreement which arise after the termination
or expiration of this Agreement are determined by a bankruptcy court
not
to be “intellectual property rights” for purposes of Section 365(n),
all of such rights shall remain vested in and fully retained by TXUED
after any Bankruptcy Rejection as though this Agreement were terminated
or
expired. TXUED shall under no circumstances be required to terminate
this
Agreement after a Bankruptcy Rejection in order to enjoy or acquire
any of
its rights under this Agreement, including without limitation any
of the
rights of TXUED referenced in the Services
Agreements.
|
|
18.5
|
Utility
Regulation. It
is not intended that Vendor be an “electric utility” (as defined in the
Texas Public Utility Regulatory Act). If the PUC, or another governmental
body or court of competent jurisdiction, determines that Vendor is
an
electric utility within the meaning of the Texas Public Utility Regulatory
Act, the Parties will use commercially reasonable efforts to cause
that
determination to be reversed or overruled, whether by contesting
it
appropriately, remediating the underlying cause of the determination,
or a
combination thereof. If such determination has not been reversed
or
overruled within one hundred eighty (180) days thereof, then such
commercially reasonable efforts thereafter also shall include the
Parties’
good faith negotiations in an effort to revise the Services so as
to cause
Vendor not to be considered an electric utility by such PUC. If,
notwithstanding such reasonable efforts, such determination has not
been
reversed or overruled within two hundred and seventy (270) days thereof,
then either Party may, by giving notice to the other Party, terminate
this
Agreement as of a date specified in the notice of termination, which
notice may be given at any time after the expiration of such two
hundred
and seventy (270) day period (provided that the PUC’s determination has
not subsequently been reversed or overruled prior to such date in
said
termination notice).
|
|
18.6
|
Reserved.
|
|
18.7
|
Reserved.
|
|
18.8
|
Reserved.
|
Page
61 of
67
AMENDED
AND RESTATED
MASTER
AGREEMENT
|
18.9
|
Termination
For Convenience.
Commencing on the second (2nd)
anniversary of the Services Agreement Commencement Date for a Services
Agreement, TXUED may terminate that Services Agreement for convenience
and
without cause effective as of any date by giving Vendor notice of
such
termination at least one-hundred eighty (180) days prior to the
termination date specified in the notice. Upon the Substantial Completion
of all Termination Assistance Services requested by TXUED in accordance
with the provisions of this Master Agreement and the applicable Services
Agreement(s), TXUED shall pay to Vendor the Termination Charges set
forth
in Schedule
N
to
the applicable Services
Agreement(s).
|
|
18.10
|
Cross
Termination Rights and Termination Charges.
|
|
(a)
|
This
Master Agreement shall automatically terminate upon the expiration
or
termination of all the Services
Agreements.
|
|
(b)
|
Upon
the expiration or termination of this Master Agreement all of the
Services
Agreements shall automatically
terminate.
|
|
(c)
|
Except
for Termination Fees payable by TXUED if it terminates this Master
Agreement under Section
18.9,
no other termination fees shall be payable by a Party that terminates
this
Master Agreement under an express termination right set forth in
this
Master Agreement.
|
|
(d)
|
Except
as otherwise expressly provided in this Agreement, each Party may
only
terminate this Master Agreement or any Services Agreement in its
entirety.
|
|
(e)
|
If
TXUED terminates a portion of any Services under any Services Agreement
(to the extent expressly permitted by this Agreement) and subsequently
terminates the remaining portion of that Services Agreement in whole
under
Section
18.9,
then the applicable Termination Charges shall be adjusted in accordance
with Schedule
N
to
such Services Agreement, or in the absence of any provisions in
Schedule
N
to
such Services Agreement, the applicable Termination Charges shall
be
equitably reduced in proportion to the portion of the Services that
TXUED
previously terminated in part.
|
|
18.11
|
Equitable
Remedies.
Vendor acknowledges that, in the event it breaches (or attempts or
threatens to breach) its obligation to provide Termination Assistance
Services as provided in Section 4.2,
its obligation respecting continued performance in accordance with
Section 17.3,
or its obligations respecting Proprietary Information in Section
12.3,
TXUED will be irreparably harmed. In such a circumstance, TXUED may
proceed directly to court. If a court of competent jurisdiction should
find that Vendor has breached (or attempted or threatened to breach)
any
such obligations, Vendor agrees that without any additional findings
of
irreparable injury or other conditions to injunctive relief (including
without the posting of any bond), it shall not oppose the entry of
an
appropriate order compelling performance by Vendor and restraining
it from
any further breaches (or attempted or threatened breaches). TXUED
acknowledges that, in the event it breaches (or attempts or threatens
to
breach) its obligations respecting Proprietary Information in Section
12.3,
Vendor will be irreparably harmed. In such a circumstance, Vendor
may
proceed directly to court. If a court of competent jurisdiction should
find that TXUED has breached (or attempted or threatened to breach)
any
such obligations, TXUED agrees that without any additional findings
of
irreparable injury or other conditions to injunctive relief (including
without the posting of any bond), it shall not oppose the entry of
an
appropriate order compelling performance by TXUED and restraining
it from
any further breaches (or attempted or threatened
breaches).
|
Page
62 of
67
AMENDED
AND RESTATED
MASTER
AGREEMENT
|
19.
|
GENERAL
|
|
19.1
|
Binding
Nature and Assignment.
This Agreement is binding on the Parties and their respective successors
and permitted assigns. Neither Party may, nor will it have the power
to,
assign this Agreement without the prior written consent of the other
Party. Any attempted assignment that does not comply with the terms
of
this Section shall be null and
void.
|
|
19.2
|
Entire
Agreement; Amendment.
The Transaction Documents constitute
the entire agreement between the Parties with respect to the subject
matter hereof and thereof. There are no agreements, representations,
warranties, promises, covenants, commitments or undertakings other
than
those expressly set forth herein or therein. The Transaction Documents
supersede all prior agreements, representations, warranties, promises,
covenants, commitments or undertaking, whether written or oral, with
respect to the subject matter contained herein and therein. No amendment,
modification, change, waiver, or discharge hereof or any increase
in the
volume or type of Services (including New Services) shall be valid
unless
in writing and signed by, in the case of TXUED, the TXUED Account
Executive, and in the case of Vendor, the Vendor Account Executive.
|
|
19.3
|
Notices.
All notices, notifications, requests, demands, waivers, consents,
approvals, agreements, authorizations, acknowledgments, communications
or
determinations required under this Agreement shall be in writing
and shall
be delivered in hard copy using one of the following methods and
shall be
deemed delivered upon receipt: (i) by hand; (ii) by an express
courier with a reliable system for tracking delivery; or (iii) by
registered or certified mail, return receipt requested, postage prepaid
as
follows:
|
In
the
case of TXUED:
TXU
ELECTRIC DELIVERY COMPANY
000
X.
Xxxxx Xxxxxx
00xx
Xxxxx
Xxxxxx,
Xxxxx 00000
Attention:
Chief Executive Officer
With
a
copy to:
TXU
ELECTRIC DELIVERY COMPANY
000
X.
Xxxxx Xxxxxx
00xx
Xxxxx
Xxxxxx,
Xxxxx 00000
Attention:
Chief Legal Officer
and
In
the
case of Vendor:
INFRASTRUX
ENERGY SERVICES GROUP LP
000
X.
0xx
Xxxxxx
Xxxx
Xxxxx, Xxxxx 00000
Attention:
Chief Executive Officer
With
a
copy to:
INFRASTRUX
ENERGY SERVICES GROUP LP
c/o
Infrastrux Energy Group, Inc.
00000
X.X. 0xx
Xxxxxx
Xxxxx
0000
Xxxxxxxx,
Xxxxxxxxxx 00000
Attention:
Chief Executive Officer
Page
63 of
67
AMENDED
AND RESTATED
MASTER
AGREEMENT
A
Party
may change its address or designee for notification purposes by giving the
other
Party notice of the new address or designee at least thirty (30) days prior
to
the date upon which it shall become effective.
|
19.4
|
Counterparts.
This Agreement may be executed in several counterparts, all of which
taken
together shall constitute one single agreement between the Parties
hereto.
|
|
19.5
|
Headings.
The article and section headings and the table of contents used in
this
Agreement are for reference and convenience only and shall not be
considered in the interpretation of this
Agreement.
|
|
19.6
|
Relationship
of Parties.
Neither Party is an agent of the other Party and neither Party has
the
right, power or authority, expressly or impliedly, to represent or
bind
the other Party as to any matters, except as expressly authorized
in this
Agreement.
|
|
19.7
|
Severability.
In the event that any provision of this Agreement conflicts with
the Law
under which this Agreement is to be construed or if any such provision
is
held invalid or unenforceable by a court with jurisdiction over the
Parties, such provision shall be deemed to be restated to reflect
as
nearly as possible the original intentions of the Parties in accordance
with applicable Law. The remaining provisions of this Agreement and
the
application of the challenged provision to persons or circumstances
other
than those as to which it is invalid or unenforceable shall not be
affected thereby, and each such provision shall be valid and enforceable
to the full extent permitted by
Law.
|
|
19.8
|
Approvals
and Consents.
An approval or consent given by a Party under this Agreement shall
not
relieve the other Party from responsibility for complying with the
requirements of this Agreement, nor shall it be construed as a waiver
of
any rights under this Agreement, except as and to the extent otherwise
expressly provided in such approval or consent. Except as specifically
set
forth in this Agreement, all consents, approvals, requests and
authorizations to be given by either Party under this Agreement will
not
be unreasonably made, withheld, delayed or denied.
|
Page
64 of
67
AMENDED
AND RESTATED
MASTER
AGREEMENT
|
19.9
|
Waiver
of Default; Cumulative
Remedies.
|
|
(a)
|
Waiver
of Default.
A
delay or omission by either Party in exercising any right or power
under
this Agreement shall not be construed to be a waiver thereof. A waiver
by
either of the Parties of any of the covenants to be performed by
the other
or any breach thereof shall not be construed to be a waiver of any
succeeding breach thereof or of any other covenant. All waivers must
be in
writing and signed by the Party waiving its
rights.
|
|
(b)
|
Cumulative
Remedies.
All remedies provided for in this Agreement shall be cumulative and
in
addition to and not in lieu of any other remedies available to either
Party at Law, in equity or
otherwise.
|
|
19.10
|
Survival.
Any provision of this Agreement which contemplates performance or
observance subsequent to any termination or expiration of this Agreement
shall survive any termination or expiration of this Agreement and
continue
in full force and effect.
|
|
19.11
|
Publicity.
Neither Party shall use the other Party’s or the other Party’s Affiliates’
name(s), trade or service xxxx(s) or other identifying information
or
refer to the other Party directly or indirectly in any media release,
public announcement, or public disclosure relating to this Agreement,
including in any advertising, promotional or marketing materials,
customer
lists or business presentations without the prior written consent
of the
other Party prior to each such use or release. Upon Vendor’s request,
TXUED shall cooperate with Vendor, at Vendor’s expense, in marketing to
third parties the services offered by the
Vendor.
|
|
19.12
|
Export.
The Parties acknowledge that certain equipment, Software and technical
data to be provided hereunder and certain transactions hereunder
may be
subject to export controls under the Laws and regulations of the
United
States, the European Union, the United Nations and other jurisdictions.
No
Party shall export or re-export any such items or any direct product
thereof or undertake any transaction or service in violation of any
such
Laws or regulations. To the extent within Vendor’s control, Vendor shall
be responsible for, and shall coordinate and oversee, compliance
with such
export Laws in respect of such items exported or imported
hereunder.
|
|
19.13
|
Third
Party Beneficiaries.
Except as expressly provided herein, this Agreement is entered into
solely
between, and may be enforced only by, TXUED and Vendor. This Agreement
shall not be deemed to create any rights or causes of action in or
on
behalf of any third parties, including without limitation employees,
suppliers and customers of a Party, or to create any obligations
of a
Party to any such third parties. Notwithstanding the immediately
preceding
sentence, Vendor acknowledges and agrees that (a) TXUED shall be
entitled
to assert actions and claims against Vendor on behalf of each Eligible
Recipient that has received Services as if such Eligible Recipient
were a
party to this Agreement, (b) direct damages suffered by each Eligible
Recipient arising out of or relating to Vendor’s performance or failure to
perform under this Agreement shall be deemed to be direct damages
of TXUED
and (c) the damages suffered by each Eligible Recipient of the type
contemplated and limited by Section 16.2
shall be deemed to be damages of TXUED under Section 16.2;
provided, that if any Law nullifies or limits the results intended
by this
sentence, each adversely affected Eligible Recipient shall be considered
an express third party beneficiary of this Agreement and shall be
entitled
to assert actions and claims directly against Vendor as if such Eligible
Recipient were a party to this
Agreement.
|
Page
65 of
67
AMENDED
AND RESTATED
MASTER
AGREEMENT
|
19.14
|
Assignment
of Agreement For Financing.
Vendor may assign, transfer, pledge, hypothecate or otherwise encumber
all
of its right, title and interest in, to and under this Agreement
as
collateral security for any financing Vendor may elect to enter into
with
any lender, trustee, lessor or other financing party (each a “Lender”)
and pursuant to such financing, TXUED will execute and deliver a
reasonable and customary consent to assignment for the benefit of
the
Lenders, which shall be in form and substance reasonably acceptable
to
TXUED. Such consent to assignment may address, among other items,
(i) the
right (but not the obligation) of the Lenders, pursuant to the exercise
of
their remedies under such assignment, to exercise Vendor’s rights and
receive notices on behalf of Vendor under this Agreement, (ii) the
right
(but not the obligation) of the Lenders to cure defaults of Vendor
in a
manner reasonably satisfactory to TXUED, (iii) the right of the Lenders,
upon request (to the extent permitted by applicable law), to receive
a
replacement agreement (which shall be in form and substance reasonably
satisfactory to TXUED) should this Agreement be terminated or rejected
as
a result of any bankruptcy of Vendor, and (iv) the right to direct
payments otherwise payable to Vendor (without offset or reduction)
to an
account controlled by the Lenders.
|
|
19.15
|
Order
of Precedence.
In the event of a conflict between this Master Agreement and any
Services
Agreement, the terms of this Master Agreement shall prevail. In the
event
of a conflict between this Master Agreement and any Exhibit hereto
the
terms of this Master Agreement shall prevail.
|
|
19.16
|
Hiring
of Employees.
|
|
(a)
|
Solicitation.
Except as expressly set forth herein, during the Term, Vendor will
not
solicit for employment, directly or indirectly, any employees of
TXUED
without the prior approval of TXUED. Except as expressly set forth
in this
Agreement, during the Term TXUED will not solicit for employment,
directly
or indirectly, any employee of Vendor without the prior consent of
Vendor.
In each case, the prohibition on solicitation shall extend ninety
(90)
days after the termination of the employee’s employment. These provisions
shall not operate or be construed to prevent or limit and employee’s right
to practice his or her profession or to utilize his or her skills
for
another employer or to restrict any employee’s freedom of movement or
association.
|
Page
66 of
67
AMENDED
AND RESTATED
MASTER
AGREEMENT
|
(b)
|
Publications.
Neither the publication of classified advertisements in newspapers,
periodicals, Internet bulletin boards, or other publications of general
availability or circulation nor the consideration and hiring of persons
responding to such advertisements shall be deemed a breach of this
Section, unless the advertisement and solicitation is undertaken
as a
means to circumvent or conceal a violation of this provision and/or
the
hiring party acts with knowledge of this hiring
prohibition.
|
|
19.17
|
Further
Assurances.
Each Party covenants and agrees that, subsequent to the execution
and
delivery of this Agreement and without any additional consideration,
each
Party shall execute and deliver any further legal instruments and
perform
any acts that are or may become necessary to effectuate the purposes
of
this Agreement.
|
|
19.18
|
Liens.
Except for those liens that are filed as a result of a bona fide
dispute
regarding TXUED’s failure to pay any amount owed Vendor hereunder, Vendor
will not file, or by its action or inaction permit any of its Affiliates
or Subcontractors to file, any liens on or against property or realty
of
TXUED. In the event that any such liens arise as a result of Vendor’s
action or inaction, Vendor will obtain a bond to fully satisfy such
liens
or otherwise remove such liens at its sole cost and expense within
ten
(10) days.
|
|
19.19
|
Acknowledgment.
The Parties each acknowledge that the terms and conditions of this
Agreement have been the subject of active and complete negotiations,
and
that such terms and conditions should not be construed in favor of
or
against any Party by reason of the extent to which any Party or its
professional advisors participated in the preparation of this
Agreement.
|
Page
67 of
67
AMENDED
AND RESTATED
MASTER
AGREEMENT
IN
WITNESS WHEREOF,
the
Parties have caused this Master Agreement to be executed by their respective
duly authorized representatives as of the Master Agreement Effective
Date.
|
TXU
ELECTRIC DELIVERY COMPANY
|
|||||
|
By:
|
|||||
|
Name:
|
|||||
|
Title:
|
|
||||
|
INFRASTRUX
ENERGY SERVICES GROUP LP
|
|||||
|
By:
|
InfrastruX
Energy GP, LLC, its general partner
|
||||
|
By:
|
InfrastruX
Group, Inc., its member
|
||||
|
By:
|
|||||
|
Name:
|
|||||
|
Title:
|
|||||
|
By:
|
TXU
Asset Services Group Management LLC, its general
partner
|
||||
|
By:
|
|||||
|
Name:
|
|||||
|
Title:
|
|||||
[Signature
Page to Master Agreement]
AMENDED
AND RESTATED EXHIBIT 1
MASTER
AGREEMENT
MASTER
AGREEMENT DEFINITIONS
References
to the preamble, articles, sections and exhibits in this Exhibit 1
are to
the preamble, Articles and Sections of, and Exhibits to, the Master Agreement
unless otherwise specified.
“Affiliate”
shall
mean, generally, with respect to any Entity, any other Entity Controlling,
Controlled by or under common Control with such Entity at the time in question;
provided that Vendor and Vendor’s Affiliates shall not constitute Affiliates of
TXUED and TXUED and TXUED’s Affiliates shall not constitute Affiliates of Vendor
for purposes of this Agreement.
“Affiliate
Standards”
shall
have the meaning given in Section
6.3(a).
“Agreement”
shall
have the meaning given in Section
2.2.
“Applications
Software”
or
“Applications”
shall
mean those software application programs and programming (and all modifications,
enhancements, improvements, documentation and Upgrades thereto and Derivative
Works thereof) used to support day-to-day business operations and accomplish
specific business objectives. Applications Software shall mean all such programs
or programming in use as of the applicable Services Agreement Effective Date,
including those set forth in Schedule H
to the
applicable Services Agreement, those which were necessary to perform the
Services, and those as to which Vendor received reasonable notice and/or
reasonable access prior to the Services Agreement Effective Date. Applications
Software also shall include all such programs or programming developed and/or
introduced by or for TXUED on or after the Services Agreement Effective
Date.
“Arbitrable
Disputes”
shall
mean any dispute arising out of or relating to the Change Control Process
(including disputes as to the existence of a Material Change), provided that
such dispute must both (i) primarily involve an amount in dispute the net
present value of which exceeds three hundred thousand dollars ($300,000) in
the
aggregate (but only if and to the extent such dispute involves an amount in
dispute) and (ii) not have been resolved in accordance with Section 17.1(a)
or
resolved in accordance with Section
17.1(b)
within
thirty (30) days after the initial notice under Section 17.1(a)
referring the dispute to the senior corporate executives.
“Audit
Area”
shall
have the meaning given in Section
8.4(e).
“Bankruptcy
Code”
shall
have the meaning given in Section
18.4(b).
“Bankruptcy
Rejection”
shall
have the meaning given in Section
18.4(b).
“Bi-Monthly
Invoice”
shall
have the meaning given in Section
11.1(a).
“Business
Unit”
or
“BU”
shall
mean business entities responsible for the support and delivery of business
functions within TXUED. These Business Units include, for example, the TXUED
Business Units of Transmission and Distribution.
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“Cabling”
shall
mean the electric connection between the Equipment and xxxx, including physical
cabling media, peripheral cabling used to interconnect electronic equipment,
all
terminating hardware and cross connect fields, but not including conduits and
pathways.
“Change”
shall
mean any one or more of the following: an increase or decrease to the Charges,
an addition of a new Charge, a deletion of a Charge, a modification to the
method for determining a Charge, a modification to the Services, an addition
of
a Service (excluding New Services), a removal of a Service or any other change
or modification to any term or condition of this Agreement.
“Change
Control Process”
shall
mean the process for addressing changes to the Services set forth in
Exhibit
8.
“Change
in Control”
shall
mean the (a) consolidation or merger of an Entity with or into any other
Entity (other than one or more Affiliates of the Entity), (b) sale,
transfer or other disposition of all or substantially all of the assets of
an
Entity (other than to one or more Affiliates of such Entity) in one transaction
or a series of related transactions or (c) acquisition by any Entity, or
group of Entities acting in concert, of beneficial ownership (as defined in
Rule
13d-3 of the Securities Exchange Act of 1934) or voting control of 50% or more
(or such lesser percentage that constitutes Control) of the outstanding voting
securities or other ownership interests of an Entity that is not an Affiliate
of
one or more of such acquiring Entities.
“Change
Order”
shall
have the meaning given in Exhibit
8.
“Change
Proposal”
shall
have the meaning given in Exhibit
8.
“Change
Request”
shall
have the meaning given in Exhibit
8.
“Charges”
shall
mean the amounts set forth in Exhibit
11
as
charges for the Services.
“Compliance”,
“Compliant”
and
“Comply”
shall
mean, with respect to Resources, Work Product or other contract deliverables
to
be acquired, obtained, made, created, built, constructed, developed,
implemented, designed, delivered, integrated, installed and/or tested by Vendor,
such Resources, Work Product or other contract deliverables shall conform with
their applicable Specifications, if any, in all material respects and shall
provide the functions and features and operate in the manner described therein
or as otherwise agreed by the Parties.
“Construction”
shall
have the meaning given in the Field Services Agreement.
“Contract
Period”
shall
have the meaning given in Section
1.2(a).
“Contract
Records”
shall
have the meaning given in Section 8.4(a).
“Contract
Year” shall
have the meaning set forth in the applicable Services Agreement, and to the
extent this term relates to this Master Agreement, Contract Year shall have
the
meaning set forth in the Field Services Agreement.
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“Control”
and
its
derivatives shall mean: (a) the beneficial ownership (as defined or
determined pursuant to Rule 13d-3 of the Securities Exchange Act of 1934, as
amended) of at least fifty percent (50%) of the aggregate of all voting
equity interests in an Entity; (b) the right to appoint, directly or
indirectly, a majority of the board of directors; or (c) the right to
control, directly or indirectly, the management or direction of the Entity
by
contract or corporate governance document.
“Cumulative
Spend Commitment”
shall
have the meaning given in Section
1.2(a).
“Cumulative
Total Spend”
shall
have the meaning given in Section
1.2(a).
“Damages
Cap”
shall
have the meaning given in Section
16.2(b).
“Derivative
Work”
shall
mean a work based on one or more preexisting works, including a condensation,
transformation, translation, modification, expansion, or adaptation, that,
if
prepared without authorization of the owner of the copyright of such preexisting
work, would constitute a copyright infringement under applicable Law, but
excluding the preexisting work.
“Distribution
System”
shall
have the meaning given to such term in the Field Services
Agreement.
“Eligible
Recipients”
shall
mean, collectively, and to the extent such Entity is receiving Services under
this Agreement, the following:
|
(a)
|
TXU
Electric Delivery Company;
|
|
(b)
|
any
Entity that purchases after the applicable Services Agreement Effective
Date (i) from TXUED or (ii) from any Entity that is created using
assets
of TXUED, in either case (i) or (ii) less than substantially all
of the
assets of TXUED or such Entity, or of any division, marketing unit,
Business Unit, or manufacturing, research or development facility
thereof,
provided that such acquiring Entity shall only be entitled to receive
Termination Assistance Services hereunder and such acquiring Entity
must
agree in writing to be bound by the terms and conditions of this
Agreement;
|
|
(c)
|
any
Entity that purchases after the applicable Services Agreement Effective
Date (i) from TXUED or (ii) from any Entity that is created using
assets
of TXUED, in either case (i) or (ii) all or substantially all of
the
assets of TXUED or such Entity, or of any division, marketing unit,
Business Unit, or manufacturing, research or development facility
thereof,
provided that such acquiring Entity must agree in writing to be bound
by
the terms and conditions of this
Agreement;
|
|
(d)
|
any
Entity that after the applicable Services Agreement Effective Date
is
created using assets of TXUED, provided that such Entity agrees in
writing
to be bound by the terms and conditions of this
Agreement;
|
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|
(e)
|
any
Entity to which TXUED or an Affiliate of TXUED outsources any of
its
existing functions to the extent needed for such Entity to continue
performing such function for TXUED or its Affiliates, or any other
customer of such Entity; and
|
|
(f)
|
other
entities to which the Parties
agree.
|
Eligible
Recipients shall include any Entity that is a contractor, subcontractor, agent
or representative of the Entities identified as Eligible Recipients in this
definition.
“Employment
Costs”
shall
have the meaning given in Section
8.8.
“Employment
Effective Date”
shall
have the meaning set forth in Exhibit
2.
“End
User”
shall
mean, collectively, all Eligible Recipients (and their respective employees,
contractors, subcontractors, agents and representatives, other than Vendor
and
its Subcontractors) designated by TXUED to receive or use the Services provided
by Vendor.
“Entity”
shall
mean a corporation, partnership, joint venture, trust, limited liability
company, limited liability partnership, association or other organization or
entity.
“Equipment”
shall
mean all computing (hardware and firmware), networking, communications, and
related computing equipment (and all attachments, modifications, enhancements,
improvements, documentation and Upgrades thereto) procured, provided, operated,
supported, or used by Vendor in connection with the Services, including
(i) mainframe, midrange, server and distributed computing equipment and
associated attachments, features, accessories, peripheral devices, and Cabling,
(ii) personal computers, laptop computers, workstations and personal data
devices and associated attachments, features, accessories, printers,
multi-functional printers, peripheral or network devices, and Cabling, and
(iii) voice, data, video and wireless telecommunications and network and
monitoring equipment and associated attachments, features, accessories, cell
phones, peripheral devices, and Cabling.
“Event
of Loss”
shall
have the meaning given in Section
2(a)
of
Exhibit
9.
“Field
Services Agreement” shall
mean the Field Services Agreement dated as of the Master Agreement Effective
Date between the Parties.
“Income
Tax”
shall
mean any tax on or measured by the net income of a Party (including taxes on
capital or net worth that are imposed as an alternative to a tax based on net
or
gross income), or taxes which are of the nature of excess profits tax, minimum
tax on tax preferences, alternative minimum tax, accumulated earnings tax,
personal holding company tax, capital gains tax or franchise tax for the
privilege of doing business.
“Initial
Services Agreement”
shall
mean the Field Services Agreement.
“Initial
Term”
shall
have the meaning given in Section 3.1.
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“Key
Vendor Personnel”
shall
mean the Vendor Personnel filling the positions designated in Schedule C
to the
applicable Services Agreement as Key Vendor Personnel.
“Laws”
shall
mean all applicable federal, state, provincial, regional, territorial and local
laws, statutes, ordinances, regulations, rules, executive orders, supervisory
requirements, directives, circulars, opinions, interpretive letters and other
official releases of or by any government, or any authority, department or
agency thereof, including any amendments thereto.
“Losses”
shall
mean all losses, liabilities, damages, fines, penalties and claims (including
taxes), and all related costs and expenses (including reasonable legal fees
and
disbursements and costs of investigation, litigation, settlement, judgment,
interest and penalties).
“LTE”
shall
have the meaning given in Section
1.2(f).
“Maintenance”
shall
have the meaning given in the Field Services Agreement.
“Managed
Third Party Agreements”
shall
mean those Third Party Contracts between third parties and TXUED that have
been
or will be used to provide the Services and are managed and administered by
Vendor. The Managed Third Party Agreements are identified in Schedule
E.5
to the
applicable Services Agreement.
“Master
Agreement”
shall
mean this Master Framework Agreement dated as of the Master Agreement Effective
Date between the Parties.
“Master
Agreement Effective Date”
shall
have the meaning given in the preamble.
“Master
Lease Agreement”
shall
mean that certain Master Lease Agreement between the Parties and dated as of
the
Master Agreement Effective Date.
“Material
Change”
shall
mean a change or related changes in circumstances or the occurrence of an event
or related events, in each case that is beyond the reasonable control of Vendor,
except to the extent that Vendor is at fault in failing to prevent or causing
such circumstance or event, that individually or cumulatively result or results
in either (i) a material change to any Service or Services, including the
manner in which the Services are performed, or (ii) materially different
levels of effort, Resources or expense from Vendor, including materially
different levels of time, expense or cost (including general cost structure)
to
perform any Service or Services.
“Materials”
shall
mean, collectively, Software, literary works, other works of authorship,
specifications, designs, analyses, processes, methodologies, concepts,
inventions, know-how, programs, program listings, programming tools,
documentation, reports, drawings and databases, whether tangible or intangible
(and all modifications, enhancements, improvements, documentation and Upgrades
thereto and Derivative Works thereof).
“New
Services”
shall
mean a new service or services or a change or changes to any existing Service
or
Services requested by TXUED or required by applicable Laws, that: (i) are
materially different from the Services being performed as of the Services
Agreement Commencement Date for the applicable Services Agreement (including
the
manner in which the Services are performed), as amended by all Change Orders;
or
(ii) require materially different levels of effort, Resources or expense
from Vendor from the levels of effort, Resources or expense required as of
the
Services Agreement Commencement Date for the applicable Services Agreement
(including the manner in which the Services are performed), as amended by all
Change Orders. For the avoidance of doubt, New Services shall not include
increases in the volume of Services to be provided by Vendor, which increases
will give rise to an increase in Charges in accordance with Exhibit
11.
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“New
Services Agreement”
shall
mean a services agreement entered into between the Parties after the Master
Agreement Effective Date.
“Notice
of Election”
shall
have the meaning given in Section
15.4(a).
“TXUED”
shall
have the meaning given in the preamble.
“TXUED
2004 Base
Case”
shall
mean the summary financial base case attached as Schedule K to
the
applicable Services Agreement, as well as the detailed financial and budget
information underlying such summary base case.
“TXUED
Affected Personnel”
shall
mean the employees of TXUED or its Affiliates who performed any of the Services
during the twelve (12) months preceding the applicable Services Agreement
Effective Date.
“TXUED
Account Executive”
shall
have the meaning given in Section 9.1(a).
“TXUED
Data”
shall
mean any data or information of TXUED that is provided to or obtained by Vendor
in connection with the negotiation and execution of this Agreement or the
performance of its obligations under this Agreement, including data and
information with respect to the businesses, customers, operations, facilities,
products, rates, regulatory compliance, competitors, consumer markets, assets,
expenditures, mergers, acquisitions, divestitures, xxxxxxxx, collections,
revenues and finances of TXUED. TXUED Data also shall mean any data or
information created, generated, collected or processed by Vendor in the
performance of its obligations under this Agreement, including data processing
input and output, service level measurements, asset information, Reports, third
party service and product agreements, contract charges, and retained and
Pass-Through Expenses, solely related to TXUED. TXUED Data shall not include
Vendor Data.
“TXUED
Facilities”
shall
mean the facilities listed in Schedule O.1
to the
applicable Services Agreement provided by TXUED for the use of Vendor to the
extent necessary to provide the Services. TXUED Facilities do not include any
facilities subject to that certain Master Lease Agreement dated as of the Master
Agreement Effective Date by and between TXU Electric Delivery Company and
Vendor.
“TXUED
Personal Data” shall
mean that portion of TXUED Data that is subject to any Privacy
Laws.
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“TXUED
Personnel”
shall
mean the employees, agents, contractors or representatives of TXUED or its
Affiliates.
“TXUED
Rules”
shall
have the meaning given in Section 6.3(a).
“TXUED
Sites”
or
“Sites”
shall
mean the offices or other facilities listed on Schedule
E.4
to the
applicable Services Agreement at or to which Vendor is to provide the
Services.
“TXUED
Standards”
shall
have the meaning given to such term in the applicable Services
Agreement.
“TXUED
Third Party Contractors”
shall
have the meaning given in Section 4.3(a).
“Operating
System Software”
shall
mean all software programs and programming (and all modifications, enhancements,
improvements, documentation and Upgrades thereto and Derivative Works thereof)
that are used to deliver and manage Services on a particular hardware platform
including operating systems (e.g., UNIX, Windows, VM and MVS) and network
operating systems (e.g., NT Server, Windows, and Novell). Operating System
Software shall include all such programs or programming in use as of the
applicable Services Agreement Effective Date, including those set forth in
Schedule H
to the
applicable Services Agreement, those as to which the license, maintenance or
support costs are included in the applicable TXUED 2004 Base Case, and those
as
to which Vendor received reasonable notice and/or reasonable access prior to
the
applicable Services Agreement Effective Date. Operating System Software also
shall include all such programs or programming developed and/or introduced
by or
for TXUED after the applicable Services Agreement Effective Date.
“Out-of-Pocket
Expenses”
shall
mean reasonable, demonstrable and actual out-of-pocket expenses due and payable
to a third party by Vendor in accordance with the Policy and Procedures Manual
or that are approved in advance by TXUED and for which Vendor is entitled to
be
reimbursed by TXUED under this Agreement. Out-of-Pocket Expenses shall not
include Vendor’s overhead costs (or allocations thereof), general and/or
administrative expenses or other xxxx-ups. Out-of-Pocket Expenses shall be
calculated at Vendor’s actual incremental expense and shall be net of all
rebates and allowances.
“Parties”
shall
have the meaning given in the recitals to this Master Agreement.
“Party”
shall
have the meaning given in the recitals to this Master Agreement.
“Pass-Through
Expenses”
shall
mean the expenses so identified in Exhibit
11
or
otherwise agreed by the Parties, as such list may be amended from time to time.
Unless otherwise agreed, Vendor shall not charge any handling or administrative
charge in connection with its processing or review of such
invoices.
“Permitted
Subcontract”
shall
have the meaning given in Section
8.6(a).
“Policy
and Procedures Manual”
shall
have the meaning set forth in the applicable Services Agreement.
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“Privacy
Laws”
shall
mean Laws relating to data privacy, trans-border data flow or data protection
such as the implementing legislation and regulations of the European Union
member states under the European Union Directive 95/46/EC.
“Products”
shall
have the meaning given in Exhibit
11.
“Proposal”
shall
have the meaning given in Section
17.1(d).
“Proprietary
Information” shall
have the meaning given in Section 12.3(a).
“Public
Utility Regulatory Act”
means
the Public Utility Regulatory Act, Tex. Util. Code Xxx. § 11.001 et.
seq.
(Xxxxxx
1998 & Supp. 2005), as amended.
“PUC”
shall
mean the Texas Public Utility Commission or any successor thereto.
“Qualified
Expert(s)”
shall
have the meaning set forth in Section 17.1(d)(viii).
“Renewal
Term”
shall
have the meaning set forth in Section 3.2.
“Reports”
shall
have the meaning set forth in Section 8.2(a).
“Resources”
shall
mean labor, materials (including Materials), equipment (including Equipment),
tools, systems (including Systems), transportation, facilities, services and
other resources, and all attachments, modifications, enhancements, improvements,
documentation and Upgrades thereto and Derivative Works thereof.
“Root
Cause Analysis”
shall
mean the formal process, specified in the Policy and Procedures Manual, to
be
used by Vendor to diagnose the underlying cause of problems at the lowest
reasonable level so that corrective action can be taken that will eliminate
repeat failures.
“SAS
70 Audit”
shall
have the meaning given in Section
8.4(i).
“SAS
70 Report”
shall
have the meaning given in Section
8.4(i).
“Seconded
TXUED Personnel”
shall
have the meaning given in Section
8.8.
“Seconded
Vendor Personnel”
shall
have the meaning given in Section
8.9.
“Service
Level Credits”
shall
have the meaning
given in Section 7.2.
“Service
Level Defaults”
shall
mean Service Level Shortfalls as defined in Schedule
G
to the
Field Services Agreement.
“Service
Levels”
shall
mean, individually and collectively, the performance standards for the Services
set forth in Schedule G
to the
applicable Services Agreement.
“Service
Taxes”
shall
mean all sales, use, excise and other similar transaction-based taxes that
are
assessed against either Party on the provision of the Services as a whole,
or on
any particular Service received by TXUED from Vendor, excluding Income Taxes,
or
on Vendor in connection with Vendor’s performance of the Services.
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“Services”
shall
have the meaning given in Section
4.1(a).
“Services
Agreements”
shall
mean, collectively, the Initial Services Agreement and each New Services
Agreement.
“Services Agreement
Commencement Date”
shall
mean the date on which Vendor shall assume responsibility for the Services
set
forth in the applicable Services Agreement.
“Services
Agreement Effective Date”
shall
mean the date on which the Parties have executed the applicable Services
Agreement.
“Shared
Subcontractors”
shall
have the meaning given in Section
8.6(b).
“Software”
shall
mean all software programs and programming (and all modifications, enhancements,
improvements, documentation and Upgrades thereto and Derivative Works
thereof).
“Specifications”
shall
mean, with respect to any Resource, Work Product or other contract deliverable
to be acquired, obtained, made, created, built, constructed, developed,
implemented, designed, delivered, integrated, installed and/or tested by Vendor,
the technical, design and/or functional specifications set forth in (a)
Schedule E
to the
applicable Services Agreement, (b) the applicable third party manufacturer
or
supplier documentation or (c) the applicable New Services or Work Request
description requested and/or approved by TXUED, or such other technical design
and/or functional specifications agreed upon by the Parties.
“Subcontractors”
shall
mean subcontractors of Vendor, including each Permitted Subcontract and Shared
Subcontractors.
“Substantial
Completion”
shall
mean that the Termination Assistance Services requested by TXUED in accordance
with the provisions of this Master Agreement and the applicable Services
Agreement(s) have been completed to TXUED’s reasonable satisfaction in all
material respects.
“System”
shall
mean an interconnected grouping of Equipment, Software and associated
attachments, features, accessories, peripherals and Cabling, and all
attachments, modifications, enhancements, improvements, documentation and
Upgrades to such System. System shall include all Systems in use as of the
applicable Services Agreement Effective Date, all attachments, modifications,
enhancements, improvements, documentation and Upgrades to such Systems and
all
Systems acquired, obtained, made, created, built, constructed or developed
by or
for TXUED or Vendor following the applicable Services Agreement Effective
Date.
“System
Change”
shall
mean any change to the Software, Equipment, System or operating environment
including without limitation changes to programs, manual procedures, job control
language statements, distribution parameters, or schedules.
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“Systems
Software”
shall
mean all software programs and programming (and all modifications, enhancements,
improvements, documentation and Upgrades thereto and Derivative Works thereof)
that perform tasks basic to the functioning of the Equipment and are required
to
operate the Applications Software or otherwise support the provision of Services
by Vendor. For purposes of this Agreement, Systems Software shall include
antivirus software, asset management software, local area and wide area network
software, monitoring software, Operating System Software, problem management
software, remote management software, system utilities, and System testing
tools. Systems Software shall include all such programs or programming in use
as
of the Services Agreement Effective Date, including those set forth in
Schedule H to
the
applicable Services Agreement, those as to which the license, maintenance or
support costs are included in the TXUED 2004 Base Case, and those as to which
Vendor received reasonable notice and/or reasonable access prior to the
applicable Services Agreement Effective Date. Systems Software also shall
include all such programs or programming developed and/or introduced by or
for
TXUED or Vendor after the applicable Services Agreement Effective
Date.
“Tax
Authority”
shall
mean any federal, state, provincial, regional, territorial, local or other
fiscal, revenue, customs or excise authority, body or official competent to
impose, collect or asses tax.
“Term”
shall
have the meaning given in Section 3.2.
“Termination
Assistance Services”
shall
mean (i) the Services (including the terminated, insourced, resourced or
expired Services and, in each case, any replacements thereof or supplements
thereto), to the extent TXUED requests such Services during the period in which
Vendor provides the applicable Termination Assistance Services, (ii) the
termination/expiration assistance provided to TXUED to allow the Services to
continue without interruption or adverse effect and to facilitate the orderly
transfer of the Services to TXUED or its designee, as such assistance is further
described in Section 4.2
of the
Master Agreement, and Section
4.3
of and
Schedule I to
the
applicable Services Agreement and (iii) the performance of any other
obligation of Vendor upon or in connection with the expiration or termination
of
this Agreement.
“Termination
Charge”
shall
mean, with respect to any Services Agreement, the applicable termination charges
payable by TXUED as set forth in Schedule N to
such
Services Agreement.
“Third
Party Contracts”
shall
mean (i) all agreements between third parties and Vendor and (ii) Managed Third
Party Contracts, in each case that have been or will be used to provide the
Services.
“Transaction
Documents”
shall
have the meaning given in that certain Participation Agreement, dated June
24,
2006, among InfrastruX Group, Inc., a Washington corporation, TXU Asset Services
Company LLC, a Delaware limited liability company, and (for certain limited
purposes only) TXU Electric Delivery Company, a Texas corporation). For the
avoidance of doubt, the Transaction Documents include this
Agreement.
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“Transformation
Period”
shall
mean the period that specified in the applicable Services Agreement for
performance of the Transformation Services.
“Transformation
Plan”
shall
mean the plan set forth in Schedule
S
to the
applicable Services Agreement and developed pursuant to such Services Agreement,
which identifies all material transformation tasks and deliverables to be
completed by Vendor or TXUED, as applicable, in connection with the
transformation, and the dates by which each is to be completed by Vendor or
TXUED, as applicable.
“Transformation
Services”
shall
mean the services, functions and responsibilities described in the applicable
Services Agreement and in the applicable Transformation Plan to be performed
by
Vendor during the Transformation Period.
“Transition
Period”
shall
mean the period that commences on the applicable Services Agreement Effective
Date and expires 11:59:59 p.m., Central Time, on the date specified for the
completion of the Transition Services as specified in the Transition Plan,
unless expressly extended in writing by TXUED.
“Transition
Plan”
shall
mean the plan set forth in Schedule B
to the
applicable Services Agreement and developed pursuant to such Services Agreement,
which identifies all material transition tasks and deliverables to be completed
by Vendor or TXUED, as applicable, in connection with the transition of all
Services to Vendor, and the dates by which each is to be completed by Vendor
or
TXUED, as applicable.
“Transition
Services”
shall
mean the services, functions and responsibilities described in the applicable
Services Agreement and in the applicable Transition Plan to be performed by
Vendor during the Transition Period.
“Transitioned
Employees”
shall
mean the employees of TXUED or its Affiliates who accept Vendor’s offer of
employment and become employed by Vendor pursuant to the applicable Services
Agreement. Upon being employed by Vendor, such Transitioned Employees shall
be
deemed to be Vendor Personnel as defined herein.
“Transmission
System” shall
have the meaning given to such term in the Field Services
Agreement.
“Turnover
Rate”
shall
have the meaning given in Section
7.10(b).
“Unit”
shall
have the meaning given in Exhibit
11.
“Unit
Prices”
shall
have the meaning given in Exhibit
11.
“Upgrade”
and
its
derivatives shall mean (i) any change that extends the usefulness or performance
of any Resource (including any improvement, update, renovation, enhancement
or
addition) and (ii) any replacement or new model, version or release of any
Resource.
“Vendor”
shall
have the meaning given in the preamble.
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“Vendor
Account Executive” shall
have the meaning given in Section 7.8.
“Vendor
Data”
shall
mean any data or information of Vendor that is provided to or obtained by TXUED
in connection with the negotiation and execution of this Agreement or the
exercise of its rights under this Agreement, including (i) financial/accounting
information (including costs, expenditures, xxxxxxxx collections, revenues
and
finances) of Vendor, its Affiliates or Subcontractors and (ii) human resources
and personnel information of Vendor, its Affiliates or Subcontractors. Vendor
Data shall not include TXUED Data.
“Vendor
Facilities”
shall
mean the facilities owned or leased by Vendor and from which Vendor provides
any
Services. Vendor Facilities are listed on Schedule O.2 to
the
applicable Services Agreement, and include the portions of certain facilities
owned or leased by TXUED as indicated on Schedule O.2 to
the
applicable Services Agreement.
“Vendor
Owned Software”
shall
mean all Software products (and all attachments, modifications, enhancements,
improvements, documentation and Upgrades thereto and Derivative Works thereof)
owned,
acquired or developed by or on behalf of
Vendor
or Vendor’s Affiliates, excluding in each case any Work Product, and used in
connection with the Services.
“Vendor
Personnel”
shall
mean those employees, representatives, contractors, subcontractors and agents
of
Vendor, Subcontractors and Vendor’s Affiliates who perform any Services under
this Agreement.
“Weather
Event”
shall
have the meaning given in Section
16.1.
“Work
Product”
shall
mean any materials (including Materials), equipment (including Equipment),
tools, systems (including Systems), facilities, structures and other products
(including in each case any Products), and all attachments, modifications,
enhancements, improvements, documentation and Upgrades thereto and Derivative
Works thereof,
that
are
acquired,
obtained, made, created, built, constructed, developed, implemented, designed,
delivered, integrated, installed and/or tested by or on behalf of Vendor, are
provided or delivered by Vendor as part of the Services.
“Work
Request”
shall
have the meaning given in Exhibit
11.
Page
12 of
12
AMENDED
AND RESTATED EXHIBIT 9
MASTER
AGREEMENT
VENDOR
INSURANCE
|
1.
|
Insurance
|
|
(a)
|
Requirements.
Vendor agrees to keep in full force and effect and maintain at its
sole
cost and expense the following policies of insurance with the specified
minimum limits of liability:
|
|
(i)
|
Workers’
Compensation and Employer’s Liability Insurance providing statutory
benefits in accordance with the laws and regulations of the State
of Texas
or state of jurisdiction as applicable. The minimum limits for the
employers’ liability insurance will be five hundred thousand dollars
($500,000) bodily injury each accident, five hundred thousand dollars
($500,000) each employee bodily injury by disease, five hundred thousand
dollars ($500,000) policy limit bodily injury by
disease.
|
|
(ii)
|
Commercial
General Liability Insurance, including bodily injury and property
damage,
personal and advertising injury, contractual liability, and including
products and completed operations coverage continuing for two (2)
years
after the expiration or any termination of this Agreement, with minimum
limits of one million dollars ($1,000,000) per occurrence for bodily
injury, including death and property damage.
|
|
(iii)
|
Commercial
Business Automobile Liability Insurance for coverage of owned, non-owned
and hired autos, trailers or semi-trailers with a minimum combined
single
limit of one million dollars ($1,000,000) per accident for bodily
injury,
including death, and property
damage.
|
|
(iv)
|
Excess
Liability Insurance over and above the employers’ liability, commercial
general liability and automobile liability insurance coverage, with
a
minimum limit of two million dollars ($2,000,000) per occurrence.
Coverage
must replace exhausted aggregate limits under the coverages referenced
in
Sections
1(a)(i),
(ii)
and (iii)
above.
|
|
(v)
|
Such
other insurance as may be required by Law or based on reasonable
industry
custom or practice.
|
The
insurance limits stated above can be satisfied by any combination of primary
and
excess coverage. The insurance limits stated above shall not limit recoveries
should Vendor’s available insurance proceeds be greater than the limits so
specified. The insurance policies referenced in Sections
1(a)(i),
(ii),
(iii),
(iv)
and
(v)
above,
if written on a claims-made basis, shall be maintained in full force and effect
by Vendor for two (2) years following the expiration or any termination of
this
Agreement.
Page
1 of 3
|
(b)
|
Approved
Companies.
All policies must be issued by carriers having an A.M.
Best’s
rating of “A-” or better, and an A.M.
Best’s
financial size category of “VIII”, or better and/or Standard
& Poor Insurance Solvency Review
of
“A-”, or better.
|
|
(c)
|
Endorsements.
Subject to approval by carrier, Vendor’s insurance policies required
herein under Sections 1(a)(ii)
and (iii)
of
this Exhibit shall include TXUED, TXUED’s Affiliates and Eligible
Recipients and their respective officers, directors and employees
as
Additional Insureds for any and all liability arising at any time
in
connection with this Agreement. Workers’ compensation and employers’
liability insurance as required under Section
1(a)
shall include TXUED and its Affiliates as alternate employer. Each
policy
shall provide that it will not be canceled or materially altered
except
after the issuing company endeavors to provide thirty (30) days advance
written notice to TXUED. Should any policy expire or be canceled
and
Vendor fails to immediately procure replacement insurance as specified,
TXUED reserves the right (but not the obligation) to procure such
insurance and to deduct the cost thereof from any sums due Vendor
under
this Agreement. All insurance policies required under this Section
shall
contain provisions that specify that the policies are primary and
shall
apply without consideration for other policies separately carried
and will
state each insured is provided coverage as though a separate policy
had
been issued to each, except with respects to limits of insurance,
and that
only one deductible will apply per occurrence regardless of the number
of
insureds involved in the occurrence. Vendor shall be responsible
for any
deductibles or retentions. Vendor shall obtain such endorsements
to its
policy or policies of insurance as are necessary to cause the policy
or
policies to comply with the requirements stated
herein.
|
|
(d)
|
Certificates.
Prior to commencement of Services, Vendor shall provide TXUED with
certificates of insurance evidencing compliance with this Section
(including evidence of renewal of insurance) signed by authorized
representatives of the respective carriers for each year that this
Agreement is in effect. Each certificate of insurance shall provide
that
the issuing company shall not cancel, reduce, or otherwise materially
alter the insurance afforded under the above policies unless the
issuing
company endeavors to provide notice of such cancellation or reduction
has
been provided at least thirty (30) days in advance
to:
|
|
TXU
Electric Delivery Company
|
|
000
X. Xxxxx
|
|
00xx
Xxxxx
|
|
Xxxxxx,
Xxxxx 00000
|
|
Attention:
Chief Legal Officer
|
With
a
copy to:
|
TXU
Electric Delivery Company
|
|
Risk
and Insurance
|
|
000
X. Xxxxx
|
|
Xxxxxx,
Xxxxx 00000
|
Page
2 of 3
At
TXUED’s request, Vendor shall make copies of required insurance policies
available for inspection by TXUED. In addition, Vendor will require each of
its
Subcontractors to provide adequate insurance for the Services subcontracted
to
them. Any deficiencies in the insurance to be provided by Subcontractors will
be
the responsibility of Vendor.
|
(e)
|
No
Implied Limitation.
The obligation of Vendor to provide the insurance specified herein
shall
not limit or qualify in any way any obligation or liability of Vendor
provided elsewhere in this Agreement. The rights of TXUED, its Affiliates
and Eligible Recipients to insurance coverage under policies issued
to or
for the benefit of one or more of them are independent of this Agreement
shall not be limited by this
Agreement.
|
|
(f)
|
Insurance
Subrogation. With
respect to insurance coverage to be provided by Vendor pursuant to
Section
1(a)
of
this Exhibit, the insurance policies shall provide that the insurance
companies waive all rights of subrogation against Vendor, TXUED,
the
Eligible Recipients and their respective Affiliates, officers, directors
and employees. Vendor waives its rights to recover against TXUED,
TXUED’s
Affiliates and Eligible Recipients and their respective officers,
directors, and employees in
subrogation.
|
| 2. |
Risk
of Loss
|
|
(a)
|
General.
Each Party shall be responsible for risk of loss of, and damage to,
any
TXUED Data, Utility Facilities (defined in Schedule
A
to
the Field Services Agreement), Products (defined in Exhibit
11)
and Resources in its possession or under its control. Vendor shall
in all
cases be deemed to possess and control (i) all TXUED Data used by
Vendor
to provide the Services, (ii) all Products from the seller’s, licensor’s,
lessor’s or other third party’s location as contemplated by “Ex-Works” or
“EXW” (INCOTERMS 2000) to Close-Out (defined in Exhibit
11)
and (iii) all Resources used by Vendor to provide the Services. TXUED
shall in all cases be deemed to possess and control all Utility Facilities
and all facilities leased to Vendor under the terms of the Master
Lease
Agreement. Each Party shall promptly notify the other of any damage
(except normal wear and tear), destruction or loss from any cause,
or any
theft or governmental taking, of which such Party becomes aware
(“Event
of Loss”).
The Party that is deemed to be in possession and control (as aforesaid)
of
the TXUED Data, Utility Facilities, Products or Resources that is
the
subject of an Event of Loss shall in all cases be responsible for
the cost
of any necessary repair or replacement of such TXUED Data, Utility
Facilities, Products or Resources due to an Event of Loss. In the
event of
an Event of Loss by TXUED, such repair or replacement shall not be
considered part of Vendor’s maintenance obligations, but Vendor shall
coordinate and oversee repair or replacement performed by a third-party
on
a Pass-Through Expenses basis, or by Vendor at agreed-upon
prices.
|
|
(b)
|
Waiver.
Vendor and TXUED each waives all rights to recover against the other
Party
for damage, destruction, loss, theft, or governmental taking of its
real
or tangible personal property (whether owned or leased) that is deemed
to
be in its possession and control (as aforesaid) from any cause, including
their respective deductibles or self-insured retentions. In a manner
consistent with the foregoing, Vendor and TXUED will cause their
respective insurers to issue appropriate waivers of subrogation rights
endorsements to all property insurance policies maintained by each
Party.
|
Page 3
of 3
AMENDED
AND RESTATED EXHIBIT 2
MASTER
AGREEMENT
EMPLOYEE
TRANSITION TERMS
|
1.1
|
Transitioned
Personnel.
|
|
(a)
|
Offers
and Employment.
|
|
(i)
|
Transitioned
Employees.
All
TXUED Personnel who accept Vendor’s offer of employment and begin work
with Vendor pursuant to this
Agreement are referred to as “Transitioned
Employees.”
|
|
(ii)
|
Employment
Effective
Date. Each
Transitioned Employee’s “Employment
Effective Date”
shall mean the date that such Transitioned Employee begins employment
with
Vendor, in accordance with applicable
Laws.
|
|
(iii)
|
Vendor
Offers of Employment.
Vendor
shall extend offers of employment to those TXUED Personnel identified
on
Schedule M
and shall waive any pre-conditions to such offers, including background
checks, drug testing and/or medical examinations with
respect to such TXUED Personnel.
References to Vendor in this Exhibit shall
be deemed to include any Affiliate or Subcontractor of Vendor which
employs any Transitioned Employee to perform the Services contemplated
by
this
Agreement,
and Vendor shall cause any such Affiliate or Subcontractor to fully
comply
with the terms of this Exhibit. Such
offers shall be for employment with Vendor in
positions comparable to those held by such employees at TXUED, unless
agreed otherwise by TXUED, and
Vendor shall provide
starting base wages or salaries, benefit packages and other terms
and
conditions consistent with the provisions of this Exhibit. Unless
otherwise specified in Schedule M or
agreed by the Parties, TXUED Personnel accepting such offers shall
be
considered to have been terminated from TXUED and hired by Vendor
effective as of the applicable Services Agreement Commencement
Date.
|
|
(iv)
|
Employees
on Military Leave.
With respect to any TXUED Personnel identified on Schedule M
who, on the applicable Services Agreement Commencement Date, is
on military leave, such TXUED Personnel shall remain an employee
of TXUED
until such TXUED Personnel returns to work or his/her employment
is
otherwise terminated. After such TXUED Personnel has returned from
military leave, Vendor shall promptly extend an offer of employment
to
such TXUED Personnel on the terms and conditions of employment described
in this Agreement, including this Exhibit. Vendor’s obligation to extend
such offers of employment to TXUED Personnel returning from military
leave
is not limited to a prescribed period of time but rather shall be
made at
any time such TXUED Personnel return from military leave. TXUED Personnel
accepting such offers shall be treated as Transitioned Employees
for all
purposes of this Agreement. The Employment Effective Date for such
TXUED
Personnel shall be the date on which Vendor actually employs such
TXUED
Personnel.
|
Page
1 of
8
EXHIBIT
2
MASTER
AGREEMENT
|
(v)
|
Employees
on Other Types of Leave.
With respect to any TXUED Personnel identified on Schedule M
who, on the applicable Services Agreement Commencement Date, is on
leave
status for any reason other than as set forth in Section 1.1(iv)
of
this Exhibit, including medical (Family Medical Leave Act or otherwise),
disability, salary continuation, sick leave, or other leave of absence,
which has been approved by TXUED in accordance with TXUED policies,
such
employee shall remain an employee of TXUED until his/her employment
is
otherwise terminated. If any such employee returns to work within
six (6)
months after
the applicable Services Agreement Commencement Date and
provides to TXUED any applicable supporting documentation required
by
TXUED policies for employees returning to work from such leave, including
but not limited to a return to work release,
Vendor
shall promptly extend an offer of employment to such employee on
the terms
and conditions of employment described in this Agreement, including
this
Exhibit.
TXUED Personnel accepting such offers shall be treated as Transitioned
Employees for all purposes of this Agreement. The
Employment Effective Date for such TXUED Personnel shall be the date
on
which Vendor actually employs such TXUED Personnel. For any employee
on
leave status for any reason other than as set forth in Section
1.1(iv)
of
this Exhibit on the applicable Services Agreement Commencement Date
who
does not return within six (6) months after the applicable Services
Agreement Date, Vendor shall be under no obligation to, but may,
offer
employment to such employee and, if such employer accepts such offer,
such
employee shall be treated as a Transitioned Employee hereunder, from
and
after the date on which Vendor actually employs such employee.
|
|
(b)
|
Additional
Transitioned Employees.
During the twelve (12) months following the applicable Services Agreement
Commencement Date, TXUED may designate additional TXUED Personnel,
including any Seconded TXUED Personnel, to whom offers of employment
may
be extended by Vendor at the discretion of Vendor. The compensation
and
other terms and conditions of such offers of employment shall be
as set
forth in this Exhibit and TXUED Personnel accepting such offers shall
be
treated as Transitioned Employees for all purposes of this
Agreement.
The Employment Effective Date for any
such
employee
shall be the date on which Vendor actually employs such employee.
|
Page
2 of
8
EXHIBIT
2
MASTER
AGREEMENT
|
(c)
|
Reemployment
of Transitioned Employees.
Notwithstanding anything to the contrary in this Agreement (including
the
terms of Section 19.16
of
the Master Agreement), TXUED may solicit and re-hire any Transitioned
Employee at any time after the Services Agreement Commencement Date
only
with the consent of Vendor.
|
|
(d)
|
Training/Career
Opportunities.
Vendor
shall offer training, skills development and career growth opportunities
to Transitioned Employees that are at least as favorable as those
offered
generally to similarly situated employees of
Vendor.
|
|
1.2
|
Compensation
and Employee Benefit Plans.
|
|
(a)
|
General.
Except as otherwise provided in this Exhibit, each Transitioned Employee
and his or her dependents, shall, effective as of his or her Employment
Effective Date, be immediately eligible to participate in all employee
benefit plans, programs and employee policies of Vendor that are
made
available to similarly situated employees of Vendor, unless a comparable
(in terms of scope and benefits) employee benefit plan, program or
policy
has been established for Transitioned Employees. During the Term,
compensation and benefits provided by Vendor to Transitioned Employees
shall be in compliance with the provisions of this Exhibit, and shall
be
no less favorable than the compensation and benefits generally available
to similarly situated Vendor
employees.
|
|
(b)
|
Years
of Service Credit.
With respect to each Transitioned Employee, Vendor shall recognize
all
such Transitioned Employee’s years of service which are recognized by
TXUED under the applicable TXUED severance plan (“TXUED
Service”),
for purposes of vesting, participation, eligibility for benefits,
benefit
accrual (except for accrual for purposes of calculating benefits
under the
Transitioned Employee Defined Benefit, as defined in clause (f) of
this
Section), optional forms of payment, and any other right, benefit
or
feature under each employee benefit plan, program and policy of Vendor,
except (i) as expressly set forth in Section 1.2(h)
below with respect to Vendor’s standard severance benefits which will be
provided by Vendor as set forth in said Section 1.2(h)
and in addition to the severance benefits described in Schedule 2
attached to this Exhibit, (ii) that no Transitioned Employee shall
be
eligible for any variable, incentive or other form of bonus compensation
from Vendor for or arising from any period of time prior to their
applicable Employment Effective Date, and any annual profit sharing
contribution made on behalf of a Transitioned Employee for 2006 under
Vendor’s 401(k) and profit sharing plans shall be prorated for the portion
of 2006 following the Transitioned Employee’s applicable Employment
Effective Date and (c) that vacation accrual shall not begin until
January
1, 2007, but shall accrue prospectively at a rate that recognizes
all
TXUED Service.
|
Page
3 of
8
EXHIBIT
2
MASTER
AGREEMENT
|
(c)
|
Compensation.
The starting base wage or salary of each Transitioned Employee shall
be at
least equal to that paid or provided to such Transitioned Employee
with
TXUED immediately prior to his or her Employment Effective Date,
unless
the Transitioned Employee is, with TXUED’s consent, placed in a position
that is not comparable to that held at TXUED immediately prior to
his or
her Employment Effective Date. Vendor agrees that Vendor shall not,
during
the initial ninety (90) day period following a Transitioned Employee’s
Employment Effective Date, decrease the Transitioned Employee’s starting
base wage or salary. Additionally, all Transitioned Employees shall
be
eligible to participate in Vendor’s incentive compensation plans on a
basis comparable to similarly situated Vendor
employees.
|
|
(d)
|
Employee
Welfare Benefit Plans.
Each Transitioned Employee shall be eligible effective as of his
or her
Employment Effective Date to participate immediately in Vendor’s employee
welfare benefit plans, including medical, prescription drug, dental,
group
life insurance, accidental death and dismemberment, short-term
disability,
long-term disability
and flexible spending accounts. With
respect to all such welfare plans, Vendor shall, or shall cause its
insurance carrier to: (i) waive all pre-existing condition limitations,
waiting periods, insurability requirements or similar limitations
so that
each Transitioned Employee will be fully eligible to participate
in each
welfare plan of Vendor as
of his or her Employment Effective Date; and (ii) if administratively
feasible without material harm to Vendor grant credit toward applicable
deductibles attained by each Transitioned Employee under the comparable
plan of TXUED.
|
|
(e)
|
Savings
Plans.
Each Transitioned Employee shall be eligible to participate in a
Vendor
401(k) plan,
effective as of such Transitioned Employee’s Employment Effective Date, at
the same participation and match level as he or she had with TXUED
immediately prior to his/her Employment Effective Date. Amendments,
modifications or changes to Vendor’s 401(k) plan shall be at the sole
discretion of Vendor; provided, that Vendor’s 401(k) plan shall permit, in
accordance with applicable Law, direct trustee-to-trustee transfers
and
rollovers, in
each case in the form of cash and as
contemplated under Section 402(c)
of
the Internal Revenue Code, of Transitioned Employees’ TXUED “Thrift Plan”
account balances, including all outstanding loans made under such
plan.
|
|
(f)
|
Retirement
Benefit. TXUED
shall arrange for each Transitioned Employee who immediately prior
to
their Employment Effective Date participated in the TXU Retirement
Plan to
be eligible after the Employment Effective Date for a comparable
retirement benefit under the TXU Retirement Plan. Accordingly, each
such
Transitioned Employee shall be eligible to accrue service credit
under the
TXU Retirement Plan for service completed with the Vendor, consistent
with
regulatory imputed service rules and with the TXU Retirement Plan’s terms
and conditions (the “Transitioned Employee Defined Benefit”). A
Transitioned Employee who elects to retire under the TXU Retirement
Plan
will no longer accrue additional service credit under the Transitioned
Employee Defined Benefit. Vendor shall provide the necessary employment
information to TXUED for purposes of administering the Transitioned
Employee Defined Benefit. The Base Services Charges for each Contract
Year
include no less than $10.6 million to fund and to administer the
Transitioned Employee Defined Benefit and Vendor agrees to fund the
cost
of funding and administering the Transitioned Employee Defined Benefit
up
to an amount not to exceed $10.6 million for each Contract Year (which
may
include paying such amounts to TXUED so that TXUED may remit such
amounts
to the TXU Retirement Plan and/or its administrator); provided that
TXUED
shall have the right to notify Vendor prior to the commencement of
any
Contract Year, that commencing with such Contract Year and for the
remainder of the Term, the Base Services Charges shall be reduced
by $10.6
million per Contract Year (reflected as a 1/24 credit on each Bi-Monthly
Invoice) and TXUED shall fund directly the costs of administering
and
funding the Transitioned Employee Defined Benefit for such Contract
Year
and all future Contract Years in which case Vendor shall not be
responsible for any further costs of funding and administering the
Transitioned Employee Defined Benefit for such Contract Year or any
future
Contract Year.
|
Page
4 of
8
EXHIBIT
2
MASTER
AGREEMENT
|
(g)
|
Equity-Based
Compensation Plans.
Each
Transitioned Employee shall be eligible to participate in any equity-based
compensation plan or arrangement of Vendor on a basis comparable
to
similarly situated Vendor
employees.
|
|
(h)
|
Severance
Plan. With
respect to any Transitioned Employee who executes, in a timely manner,
the
TXUED Agreement and Release attached as Schedule 1
to
this Exhibit or such other form as TXUED shall require (the “Agreement
and Release”),
if Vendor
terminates such Transitioned Employee on
or before December 31, 2006 for
any reason other than Cause,
including in connection with a transfer of such Transitioned Employee
to a
Subcontractor (excluding Vendor’s Affiliates), Vendor shall,
in
addition to Vendor’s
standard severance benefits,
provide such Transitioned Employee with the severance benefits set
forth
in Schedule 2
attached to this Exhibit. For purposes of calculating Vendor’s
standard severance benefits only,
Vendor shall credit Transitioned Employees
with service with Vendor and shall exclude prior TXUED Service. For
purposes of this Agreement, “Cause”
is defined as (i)
intentional
or gross disregard of a Vendor rule relating to employee
conduct
or
gross misconduct resulting, in either case, in material economic
harm to
Vendor, (ii)
conviction
of a felony or other crime involving moral turpitude, (iii)
refusal and/or continued failure to, in Vendor’s reasonable judgment and
discretion and consistent with Vendor’s stated employment policies,
satisfactorily perform
the tasks, duties and responsibilities assigned to a Transitioned
Employee
in his/her position with the Vendor or
(iv) failure of a Transitioned Employee to provide adequate information
for Vendor’s completion of I-9 documentation.
TXUED shall notify Vendor indicating each Transitioned Employee who
executed the Agreement and Release in a timely manner. For purposes
of
this Exhibit, each such Transitioned Employee
is
referred to as a “Transitioned
Employee who executes the Agreement and Release”.
|
Page
5 of
8
EXHIBIT
2
MASTER
AGREEMENT
|
(i)
|
Vacation
Credits.
For each Transitioned Employee who, by executing the form attached
as
Schedule
3
to
this Exhibit or such other form as TXUED shall require, has elected
to waive payment for unused accrued vacation time he or she had with
TXUED, Vendor shall credit such Transitioned Employees with the same
amount of paid vacation as was waived by such Transitioned Employees.
Transitioned Employees will be eligible to take such vacation with
Vendor
consistent with Vendor’s applicable policies and on the same basis as any
other paid vacation accrued by Transitioned Employees as employees
of
Vendor.
|
|
(j)
|
Notice.
For a period of two (2) years after a Transitioned Employee’s applicable
Employment Effective Date, Vendor shall notify TXUED within five
(5) days
of the date that any Transitioned Employee leaves the employment
of Vendor or any Affiliate
or Subcontractor of Vendor for whatever reason, whether voluntarily
or
involuntarily and, if involuntarily, shall indicate whether the
termination was for “Cause” as defined in Section
1.2(h),
in any event so that TXUED may determine whether any Transitioned
Employee
who executes the Agreement and Release remains eligible for any transition
and severance benefits (the “Separation
Benefits”)
offered in the Agreement and
Release.
|
|
(k)
|
Reimbursement
for TXUED Personnel Loans.
Certain TXUED
Personnel identified on Schedule M
owe money to TXUED for financial loans made under TXUED’s “Employee
Purchase Plan” and “Energy Conservation Plan” (together, the “Loans”).
Following the applicable Services Agreement Commencement Date, Vendor
agrees to deduct
from such Transitioned Employee’s paychecks an amount equal to (i) the
total amount owed under the Loans by such Transitioned Employee as
of his
or her Employment Effective Date, divided by (ii) the total number
of
paychecks that shall be given to such Transitioned Employee during
the
remaining term of the Loans owed by that Transitioned Employee, provided
that such Transitioned Employee first executes all appropriate payroll
deduction authorization forms proffered by Vendor. Should any such
Transitioned Employee leave the employment of Vendor or any Affiliate
or Subcontractor of Vendor for any reason, whether voluntarily or
involuntarily, prior to the date on which the
total amount owed under the Loans by such Transitioned Employee is
fully
paid, then Vendor, to the extent permitted by the terms of such loans,
the
employee’s executed payroll deduction authorizations and applicable state
law, shall collect the remaining balance owed by such Transitioned
Employee under the Loans from the Transitioned Employee’s final paycheck
and/or severance pay. In the event that a Transitioned Employee’s Loans
have not been fully paid following the termination of his/her employment
with Vendor, Vendor shall use all reasonable efforts to collect the
remaining balance owed from the Transitioned Employee. Vendor shall
owe
and pay to TXUED all amounts collected from Transitioned Employees
as
described in this Subsection as soon as administratively possible
following each payroll period in which deductions for Loans are made
or
each time such amounts are otherwise collected from Transitioned
Employees.
|
Page
6 of
8
EXHIBIT
2
MASTER
AGREEMENT
|
1.3
|
Other
Employee Matters.
|
As
of
each Transitioned Employee’s applicable Employment Effective Date, each
Transitioned Employee shall be an employee of Vendor for all purposes. Vendor
shall be responsible for funding and distributing benefits under the benefit
plans in which Transitioned Employees participate on or after each Transitioned
Employee’s applicable Employment Effective Date, except as provided for under
Section
1.2(f),
as
applicable, and for paying any compensation and remitting any income,
disability, withholding and other employment taxes for each Transitioned
Employee with respect to the period beginning on the Transitioned Employee’s
applicable Employment Effective Date. TXUED shall be responsible for funding
and
distributing benefits under the TXUED benefit plans in which Transitioned
Employees participated with respect to the period prior to their Employment
Effective Date and for paying any compensation and remitting any income,
disability, withholding and other employment taxes for each Transitioned
Employee for the period prior to the applicable Employment Effective Date of
each Transitioned Employee. TXUED shall provide Vendor with such information
in
TXUED’s possession reasonably requested by Vendor in order to fulfill Vendor’s
obligations under this Exhibit.
|
1.4
|
Vendor
Acknowledgement and Indemnity
Obligations.
|
Vendor
shall be responsible for, and Vendor agrees to indemnify, defend and hold
harmless TXUED and its Affiliates and their respective officers, directors,
employees, agents, representatives, successors, and assigns from and against
any
and all Losses attributable to any breach by Vendor of this Exhibit or the
Agreement that results in a violation of any Law, including the Worker
Adjustment and Retraining Notification Act (the “WARN
Act”)
or the
regulations promulgated thereunder, or failure of any legal obligations,
including any obligation, consistent with this Section 1.4, to ensure employees
are fit to perform the duties to which they are assigned.
Page
7 of
8
EXHIBIT
2
MASTER
AGREEMENT
Vendor
acknowledges that TXUED has informed it that the terms of this Agreement as
they
apply to Transitioned Employees who execute the Agreement and Release are being
relied upon, in part, by such Transitioned Employees and TXUED as consideration
for the Agreement and Release. Vendor shall be responsible for, and Vendor
agrees to indemnify, defend and hold harmless TXUED and its Affiliates and
their
respective officers, directors, employees, agents, representatives, successors,
and assigns from and against any and all Losses attributable to any breach
by
Vendor of the terms of this Exhibit
including any breach by Vendor or any Affiliate or Subcontractor of Vendor
that
results in an alleged or actual failure to provide the consideration for the
Agreement and Release.
TXUED
agrees that, because Vendor is waiving, under this Agreement, any pre-conditions
to offers to TXUED personnel, including background checks, drug testing and
medical examinations, TXUED will, for the period of ninety (90) days following
the Services Agreement Commencement Date, indemnify, defend and hold harmless
Vendor and its Affiliates and their respective officers, directors, employees,
agents, representatives, successors, and assigns from and against any and all
Losses attributable to a claim or allegation of negligent hire, negligent
retention or negligent performance. On and after the ninety first
(91st
) day
following the Services Agreement Commencement Date, Vendor shall be solely
responsible for ensuring that all of its employees, including Transitioned
Employees, are fit to perform the duties to which they are assigned, and Vendor
agrees to indemnify, defend and hold harmless TXUED and its Affiliates and
their
respective officers, directors, employees, agents, representatives, successors,
and assigns from and against any and all Losses attributable to a claim or
allegation that the Transitioned Employees are not fit for duty (including
any
allegations of negligent hire, negligent retention or negligent performance).
Vendor
acknowledges its obligation to offer employment to certain TXUED Personnel
returning from leaves of absence pursuant to as Sections 1.1(a)(iv)
and
(v)
of this
Exhibit. Vendor shall be responsible for, and Vendor agrees to indemnify, defend
and hold harmless TXUED and its Affiliates and their respective officers,
directors, employees, agents, representatives, successors, and assigns from
and
against any and all Losses attributable to any breach of the foregoing
obligation.
Page 8
of 8
AMENDED
AND RESTATED
EXHIBIT
2, SCHEDULE 1
MASTER
AGREEMENT
AGREEMENT
AND RELEASE
This
Agreement and Release (“Agreement”)
is
between the undersigned employee (“Employee”)
and
TXU Electric Delivery Company (the “Company”)
and
sets forth the terms of Employee’s separation from the Company and eligibility
for certain separation benefits from the Company. Employee’s employment with the
Company is ending on ________
__, 2006
(“Date
of Separation”),
and
Employee is being offered employment with _________________ (“Vendor”)
beginning _______________, 2006. The
Company is offering Employee the separation benefits described herein in
exchange for Employee’s agreements herein.
Employee
has been given a period of forty-five (45)
calendar
days to
review and consider this Agreement before signing it. Employee understands
that
signing this Agreement is an important legal act and has been advised by the
Company to consult with an attorney before signing this Agreement. If Employee
decides to accept the terms of this Agreement, Employee must sign and return
the
Agreement to Xxxxx XxXxxxxx, c/o TXU Human Resources, 1600 Xxxxx Xxxxxx, Xxxxxx,
Xxxxx 00000, within forty-five (45) calendar
days
of
receipt. Employee then has a period of seven (7)
calendar
days
after signing the Agreement to revoke Employee’s signature (“Revocation
Period”).
Revocation shall be made by delivering a written statement of revocation to
Xxxxx XxXxxxxx at the above address no later than the last day of the Revocation
Period. Delivery of revocation may be by hand, mail or overnight delivery
service, but must be received no later than the last day of the Revocation
Period. In the event that Employee revokes acceptance of the Agreement, the
Company shall have no obligation to provide Employee with any rights or benefits
under the Agreement. If timely revocation is not made, the Agreement shall
be
effective and enforceable.
Separation
Benefits.
In
exchange for Employee’s agreements herein, the Company agrees to provide the
following Separation Benefits to Employee:
Transition
Bonus.
The
Company will pay Employee a one time lump sum payment of $1,500 within four
(4)
weeks of the expiration of the Revocation Period.
Severance
Payment and Benefits.
Vendor
will provide the severance payment and benefits described below if Employee
is
terminated by Vendor on or before December 31, 2006 for reasons other than
Cause. For
purposes of this Agreement, “Cause”
is
defined as (i)
intentional
or gross disregard of a Vendor rule relating to employee conduct, or
gross
misconduct resulting, in either case, in material economic harm to
Vendor,
(ii)
conviction of a felony or other crime involving moral turpitude,
(iii) refusal
and/or continued failure
to, in the Vendor’s reasonable judgment and discretion and consistent with
Vendor’s employment policies, satisfactorily perform the tasks, duties and
responsibilities assigned to Employee in his/her position with the
Vendor,
or (iv)
failure of Employee to provide adequate information for Vendor’s completion of
I-9 documentation.
Page
1 of
6
EXHIBIT
2, SCHEDULE 1
MASTER
AGREEMENT
|
(1)
|
Cash
Severance Payment.
A
one-time cash severance payment equal to: (a) two (2) weeks of Employee’s
base pay for each year of service with Company that is recognized
by
Company under the applicable Company severance plan (“Company
Service”)
up to twenty (20) years of Company Service; and (b) three (3) weeks
of
base pay for each year of Company Service over and above twenty (20)
years
of Company Service, with a minimum severance payment equal to eight
(8)
weeks of base pay. For
purposes of calculating such severance payment, base pay will be
Employee’s annualized base pay rate in effect on the Employee’s Date of
Separation, as defined above.
|
|
(2)
|
Outplacement
Services.
Sixty (60) days of outplacement services starting on the date of
termination from Vendor, to be provided by a third party outplacement
consultant selected by Vendor.
|
|
(3)
|
COBRA. To
the extent Employee elects to continue medical benefits pursuant
to
the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”),
Employee shall pay for continuation
of
health care coverage
at
the Vendor’s
prevailing
employee rate for the
number of weeks used to calculate
the Cash Severance Payment described above, and the prevailing COBRA
rate
for the remaining COBRA period.
|
Continued
Eligibility for Pro-Rated Incentive Award.
Employee will be eligible for a one time lump sum cash payment from the Company
based on the 2006 target incentive award for which Employee was eligible in
the
job position Employee held immediately prior to separation (“Target
Incentive Award”).
Unless Employee has resigned from employment with the Vendor or been terminated
for Cause by the Vendor prior to the time of payment, the Company will pay
Employee such one time lump sum cash payment based on the actual performance
of
the Company, as determined in Company’s sole discretion, up to a maximum of the
Employee’s Target Incentive Award, prorated for the period of Employee’s
employment with the Company during the relevant performance period. Such
prorated one time lump sum cash payment, if any, will be made at the time
incentive awards are paid to Company employees.
Cash
Payments in Lieu of any Forfeited Amounts under the Company Salary Deferral
Program (SDP) and/or the
Deferred and Incentive Compensation Plan (DICP).
If
Employee has previously been enrolled in the SDP or DICP, Company will pay
Employee a one time lump sum cash payment equivalent to Employee’s unvested
Company match balance in the SDP and/or DICP, with actual earnings thereon,
as
of the Date of Separation, prorated for the period of Employee’s employment with
the Company during the relevant vesting period, up to the Date of Separation.
The payment, if any, will be made as soon as reasonably practical after
expiration of the Revocation Period. The payment to Employee by Company of
any
vested balances under the SDP and/or DICP will be made in accordance with the
relevant plan terms.
Page
2 of
6
EXHIBIT
2, SCHEDULE 1
MASTER
AGREEMENT
Waiver
and Release.
In
exchange for the Separation Benefits set forth above which will be provided
to
Employee by the Company pursuant to this Agreement and which Employee
acknowledges are in addition to payments and benefits that Employee would be
entitled to receive absent the Agreement, Employee individually and on behalf
of
Employee’s spouse, heirs, successors, and assigns hereby agrees not to xxx and
unconditionally releases, dismisses, and forever discharges: (i) the Company,
including but not limited to its predecessors, successors, parents,
subsidiaries, affiliated corporations, limited liability companies and
partnerships, including TXU Corp., TXU Business Services Company, TXU Energy
Company, LLC, TXU Energy Retail Company LP, TXU Portfolio Management Company
LP
(d/b/a TXU Wholesale), TXU Energy Solutions Company, LP, TXU Electric Delivery
Company (f/k/a Texas Utilities Electric Company), TXU Gas Company, TXU
Generation Company LP, TXU Generation Management LLC, TXU Big Xxxxx Company
LP,
TXU Enterprise Holdings, LLC and all of their employee benefit plans, officers,
directors, fiduciaries, employees, assigns, representatives, agents, and counsel
(collectively the “Released
Parties”);
and
(ii) Vendor from any and all claims, demands, liabilities, obligations,
agreements, damages, debts, and causes of action arising out of or connected
with Employee’s employment with or separation from the Company or any of the
Released Parties. This waiver and release includes, but is not limited to,
all
claims and causes of action under or related to: (a) Title VII of the Civil
Rights Act of 1964, the Civil Rights Act of 1991, the Civil Rights Act of 1866,
the Age Discrimination in Employment Act of 1967, the Americans with
Disabilities Act, the Employee Retirement Income Security Act of 1974, Section
211 of the Energy Reorganization Act, the Xxxxxxxx-Xxxxx Act of 2002, the Older
Workers Benefit Protection Act of 1990, the Worker Adjustment and Retraining
Notification Act, the Family and Medical Leave Act, the Texas Labor Code
(including but not limited to Chapter 451) and the Texas Commission on Human
Rights Act, including but not limited to any amendments to any of the foregoing
laws; (b) all state and federal statutes and regulations; (c) all oral or
written contract rights, including but not limited to any rights under any
Company incentive plan, program and/or labor agreement; and (d) all claims
under
common law, including but not limited to breach of contract, tort or for
personal injury of any sort.
No
Outstanding Complaints.
Employee
represents that Employee has not filed any complaints of any kind whatsoever
with any local, state, federal, or governmental agency or court against the
Company based upon Employee’s employment with the Company.
Effect
on Future Claims.
This
Agreement precludes Employee from recovering any relief as a result of any
lawsuit, grievance, or claim brought by Employee or on Employee’s behalf arising
out of Employee’s employment with or separation from the Company as of or prior
to the date of execution of this Agreement. However, nothing in this Agreement
affects Employee’s entitlement, if any, to workers’ compensation or unemployment
compensation. In addition, nothing in this Agreement prohibits Employee from
raising or pursuing any safety concerns with any federal, state, or local
government agency or from cooperating in any investigation of a safety issue.
Nothing in this Agreement restricts Employee from communications with, filing
a
charge or complaint with, or full cooperation in the investigations of, any
governmental agency on matters within their jurisdictions or from cooperating
with the Company in any internal investigation. The Agreement does prohibit
Employee from recovering any relief, including but not limited to monetary
relief, as a result of such activities.
Page
3 of
6
EXHIBIT
2, SCHEDULE 1
MASTER
AGREEMENT
Confidentiality
and Non-Disclosure.
Employee
acknowledges and agrees that, during the course of employment with the Company,
Employee acquired Confidential and Proprietary Information. “Confidential
and Proprietary Information”
means
non-public information used in or related to the business of the Company and
of
any of the Released Parties. Employee acknowledges and agrees that, even after
termination of Employee’s employment with the Company, pursuant to Texas law,
the Company’s Code of Conduct and this Agreement, Employee is obligated not to
use, disclose, or publish in any way Confidential and Proprietary Information
and is obligated to return to the Company all originals and copies of any
materials containing such information in Employee’s possession, custody, or
control. Employee also agrees that a breach of this paragraph would cause
immediate and irreparable loss, damage, and injury to the Company; that damages
for such a breach would be exceedingly difficult, if not impossible, to
estimate; and that the Company would have no adequate remedy at law.
Accordingly, Employee acknowledges that injunctive relief would be appropriate
relief for such breach.
No
Disparagement.
Employee
agrees not to make any false or disparaging, negative, unflattering, accusatory,
or defamatory remarks or references, whether written or oral, about the Company
or any of the Released Parties in any dealings with third parties (except as
expressly permitted by this Agreement). This paragraph would not be applicable
to any testimony subpoenaed or given under oath by Employee. In addition,
Employee will not take any action that primarily is designed or intended to
have
the effect of discouraging any employee, lessor, licensor, customer, supplier,
or other business associate of the Company from maintaining its business
relationships with the Company or any of the Released Parties.
Withholding.
The
Company may withhold from any amounts payable under this Agreement such federal,
state or local taxes as shall be required to be withheld pursuant to any
applicable law or regulation. In addition, Employee expressly authorizes and
agrees that any amounts that Employee owes regarding Company-issued or sponsored
travel or credit cards, and any amounts that Employee owes the Company, or
any
Released Parties, including amounts owed under the Energy Conservation Plan,
the
Appliance Purchase Plan, vacation overpayment and salary overpayments, may
be
offset and deducted from Employee’s final paycheck from the Company and/or any
payments under this Agreement. In the event that the amount of Employee’s final
paycheck and separation payments is not sufficient to fully repay the amounts
owed, Employee acknowledges a personal debt to the Company and agrees to
promptly pay the Company the full amount of that debt.
Tax
and Financial Implications of Agreement.
Employee
acknowledges and agrees that none of the Released Parties has given Employee
any
financial planning, tax or similar advice with regard to the Agreement. Employee
further acknowledges that the financial, tax and similar effects of Employee’s
decisions relating to the Agreement will depend on Employee’s particular
circumstances, that Employee should obtain advice from Employee’s own financial
or tax adviser, and that none of the Released Parties are responsible for,
or
obligated in any way with respect to, the financial, tax or any other
consequences of Employee’s decision to accept the benefits offered under the
Agreement.
Page
4 of
6
EXHIBIT
2, SCHEDULE 1
MASTER
AGREEMENT
Severability
and Modification.
If any
term, provision, covenant, or restriction of this Agreement is held by a court
of competent jurisdiction to be invalid, void or unenforceable, the remainder
of
this Agreement and the other terms, provisions, covenants and restrictions
hereof shall remain in full force and effect and shall in no way be affected,
impaired or invalidated. No modification of this Agreement shall be binding
on
any of the parties unless it has been mutually agreed to by the parties, in
a
writing signed by both parties and identified as an amendment to this Agreement.
Breach
by Employee.
Employee
understands and agrees that, in the event of breach by Employee of any of the
terms and conditions of this Agreement, the Company will be entitled to recover
all costs and expenses as a result of Employee’s breach, including reasonable
attorneys' fees and costs.
Page
5 of
6
EXHIBIT
2, SCHEDULE 1
MASTER
AGREEMENT
EMPLOYEE
HAS READ THIS AGREEMENT AND FULLY UNDERSTANDS ALL OF ITS TERMS AND WHAT THEY
MEAN. NO OTHER PROMISE, INDUCEMENT, THREAT, AGREEMENT OR UNDERSTANDING OF ANY
KIND OR DESCRIPTION WHATSOEVER HAS BEEN MADE WITH OR TO EMPLOYEE TO CAUSE
EMPLOYEE TO SIGN THIS AGREEMENT. EMPLOYEE ENTERS INTO AND SIGNS THIS AGREEMENT
KNOWINGLY AND VOLUNTARILY, WITHOUT DURESS OR COERCION OF ANY KIND WHATSOEVER
AND
WITH THE INTENT OF BEING LEGALLY BOUND BY THIS AGREEMENT.
|
|
||
|
Employee
Signature
|
Date
|
|
|
|
||
|
Employee
Name (Please Print)
|
||
|
Employee’s
Address:
|
||
|
|
||
|
|
TXU
Electric Delivery Company
|
By:
|
|
||
|
Date
|
|
Name/Title:
|
|
Page
6 of
6
AMENDED
AND RESTATED
EXHIBIT 2,
SCHEDULE 2
MASTER
AGREEMENT
SEVERANCE
BENEFITS
The
severance benefits to be provided by Vendor to Transitioned Employees who
satisfy the criteria set forth in Section
1.2(h)
of
Exhibit
2
are as
follows:
|
1.
|
Vendor
shall provide the affected Transitioned Employee with not less than
two
(2) weeks notice of termination so that the Transitioned Employee
remains
on the Vendor’s payroll for not less than two (2) weeks after such notice
and prior to termination.
|
|
2.
|
Vendor
shall pay the affected Transitioned Employee a one-time cash severance
payment equal to: (a) two (2) weeks of such Transitioned Employee’s base
pay for each year of TXUED Service for which the Transitioned Employee
is
credited under Section
1.2(b)
of
Exhibit 2
up
to twenty (20) years of TXUED Service; and (b) three (3) weeks of
base pay
for each year of TXUED Service for which the Transitioned Employee
is
credited under Section
1.2(b)
of
Exhibit 2
over and above twenty (20) years of TXUED Service. For purposes of
calculating such severance payment, base pay will be the Transitioned
Employee’s annualized base pay rate in effect on the Transitioned
Employee’s applicable Date of Separation as defined in Schedule
1
to
Exhibit
2.
The minimum number of weeks of severance pay provided for in this
Section
shall be eight (8) weeks of base
pay.
|
|
3.
|
Vendor
shall, at its cost, provide the affected Transitioned Employee with
sixty
(60) days of outplacement services commencing with the date of
termination, such services to be provided by a reputable third party
outplacement consultant selected by
Vendor.
|
|
4.
|
Vendor
shall provide the affected Transitioned Employee with continuation
health
care coverage under the Consolidated Omnibus Budget Reconciliation
Act of
1985 (“COBRA”)
with the Transitioned Employee contributing Vendor’s prevailing employee
rate for such coverage for the number of weeks used to calculate
the
severance payment described in Section
2
of
this Schedule, and the prevailing COBRA rate for the remaining
COBRA
period.
|
Page 1
of 1
AMENDED
AND RESTATED
EXHIBIT 2,
SCHEDULE 3
MASTER
AGREEMENT
UNUSED
VACATION ELECTION
I
have
accepted a job offer with _________________
(“Vendor”)
and
understand that I have an election to make regarding any vacation that I have
accrued but not used during my employment with TXU
Electric Delivery Company (the “Company”).
By
checking one of the boxes below, I make the following election:
|
o
|
I
elect to receive payment from Company following the termination of
my
employment with Company for any unused vacation that I have accrued
but
not yet used as of the termination of my employment with Company.
I
understand that as a result of this election, I will not be eligible
for
any vacation days or vacation pay with Vendor until January 1,
2007.
|
|
o
|
I
elect to receive credit with Vendor for all
of
the unused vacation that I have accrued but not yet used as of the
termination of my employment with Company. I understand that I will
be
eligible to use such vacation credit with Vendor consistent with
Vendor’s
applicable policies. I acknowledge that this election to receive
credit
for my unused vacation is in lieu of receiving any payment from Company
for unused vacation. Thus, I hereby knowingly waive any right to
make a
claim against Company and its affiliated entities and their employees,
agents and representatives for vacation pay and expressly authorize
that
vacation pay not be included in my final paycheck from
Company.
|
|
o
|
I
elect to receive payment from Company upon the termination of my
employment for some
of
the unused vacation that I have accrued but not yet used as of the
termination of my employment with Company, and to receive credit
with
Vendor for the remaining unused vacation that I have accrued but
not yet
used as of the termination of my employment with Company. I understand
that I will be eligible to use such vacation credit with Vendor consistent
with Vendor’s applicable policies. I acknowledge that this election to
receive credit for some of my unused vacation is in lieu of receiving
payment from Company for such unused vacation. Thus, I hereby knowingly
waive any right to make a claim against Company and its affiliated
entities and their employees, agents and representatives for vacation
pay
and expressly authorize that vacation pay not be included in my final
paycheck from Company to the extent I have elected to receive credit
with
Vendor for the remaining unused vacation that I have accrued but
not yet
used as of the termination of my employment with
Company.
|
|
Total
Unused Vacation Available:
|
|
||
|
|
|||
|
Unused
Vacation to be Paid upon Termination:
|
|
||
|
|
|||
|
Unused
Vacation to be Credited by Vendor:
|
|
Page
1 of 2
AMENDED
AND RESTATED
EXHIBIT
2, SCHEDULE 3
MASTER
AGREEMENT
I
HAVE READ THIS AGREEMENT AND FULLY UNDERSTAND ALL OF ITS TERMS AND WHAT THEY
MEAN. NO OTHER PROMISE, INDUCEMENT, THREAT, AGREEMENT OR UNDERSTANDING OF ANY
KIND OR DESCRIPTION WHATSOEVER HAS BEEN MADE WITH OR TO ME TO CAUSE ME TO SIGN
THIS AGREEMENT. I ENTER INTO AND SIGN THIS AGREEMENT KNOWINGLY AND VOLUNTARILY,
WITHOUT DURESS OR COERCION OF ANY KIND WHATSOEVER AND WITH THE INTENT OF BEING
LEGALLY BOUND BY THIS AGREEMENT.
|
|
||
|
Employee
Signature
|
Date
|
|
|
|
||
|
Employee
Name (Please Print)
|
||
|
Employee’s
Address:
|
||
|
|
TXU
Electric Delivery Company
|
By:
|
|
||
|
Date
|
|
Name/Title:
|
|
Page
2 of 2
AMENDED
AND RESTATED EXHIBIT 8
MASTER
AGREEMENT
GOVERNANCE/OPERATIONAL
RELATIONSHIP
***
|
***
|
CONFIDENTIAL MATERIAL REDACTED AND FILED
SEPARATELY WITH THE
COMMISSION.
|
Page
1 of
15
AMENDED
AND RESTATED EXHIBIT 8
MASTER
AGREEMENT
***
Page
2 of
15
AMENDED
AND RESTATED EXHIBIT 8
MASTER
AGREEMENT
Page
3 of
15
AMENDED
AND RESTATED EXHIBIT 8
MASTER
AGREEMENT
Page
4 of
15
AMENDED
AND RESTATED EXHIBIT 8
MASTER
AGREEMENT
Page
5 of
15
AMENDED
AND RESTATED EXHIBIT 8
MASTER
AGREEMENT
Page
6 of
15
AMENDED
AND RESTATED EXHIBIT 8
MASTER
AGREEMENT
Page
7 of
15
AMENDED
AND RESTATED EXHIBIT 8
MASTER
AGREEMENT
Page
8 of
15
AMENDED
AND RESTATED EXHIBIT 8
MASTER
AGREEMENT
Page
9 of
15
AMENDED
AND RESTATED EXHIBIT 8
MASTER
AGREEMENT
Page
10 of
15
AMENDED
AND RESTATED EXHIBIT 8
MASTER
AGREEMENT
Page
11 of
15
AMENDED
AND RESTATED EXHIBIT 8
MASTER
AGREEMENT
Page
12 of
15
AMENDED
AND RESTATED EXHIBIT 8
MASTER
AGREEMENT
Page
13 of
15
AMENDED
AND RESTATED EXHIBIT 8
MASTER
AGREEMENT
Page
14 of
15
AMENDED
AND RESTATED EXHIBIT 8
MASTER
AGREEMENT
Page
15 of
15
EXHIBIT
11
MASTER
AGREEMENT
***
|
***
|
CONFIDENTIAL MATERIAL REDACTED AND FILED
SEPARATELY WITH THE COMMISSION.
|
Page
1 of
1
AMENDED
AND RESTATED EXHIBIT 12
MASTER
AGREEMENT
RECORD
RETENTION POLICY
Purpose
The
purpose of this policy (the “Policy”)
is to
establish a Record retention, storage and disposal program based upon the
following principles:
|
·
|
To
retain all Records as long as required by applicable
Law;
|
|
·
|
To
retain all Records necessary for business reasons for a period of
time
reasonably assuring the availability of such
Records;
|
|
·
|
To
treat electronic Records, including e-mails and those Records maintained
on hard drives, disks, magnetic tapes, or other electronic means,
by the
same guidelines as other Records.
|
|
·
|
To
assure privacy and security of Records as
necessary;
|
|
·
|
To
reduce storage space requirements;
|
|
·
|
To
improve operational efficiency;
|
|
·
|
To
enhance consistency in Records disposition, and
|
|
·
|
To
assure cost savings (i.e., by only retaining business information
necessary for the conduct of TXUED’s business.)
|
Definition
A
“Record”
is
information, documents and data that are fixed in a medium, regardless of
physical form, that is generated or received by TXUED in connection with
transacting its business, and are preserved for a period of time as evidence
of
the organization, functions, policies, decisions, procedures, operations or
other activities of TXUED. Records include correspondence, e-mails, memos,
forms, reports, spreadsheets, computer printouts, pictures, microforms, plans
and drawings, graphs, computer files and programs, databases, audio/video
recordings, word processing, charts and images. Record formats include hard
paper copies, books, receipts, facsimiles, electronic mail, documents and data
created or stored electronically but not printed, documents and data stored
on
disks, diskettes, CD-ROMs, tape or other storage media, and any compilations
of
any of the above, whether maintained in individual offices or TXUED’s premises,
at home, or at any other offsite location, including without limitation on
laptop computers or other mobile devices.
Page
1 of
4
AMENDED
AND RESTATED EXHIBIT 12
MASTER
AGREEMENT
Policy
Retaining
Records
Records
created or maintained at any TXUED place of business or storage location shall
be assigned a specific retention period consistent with applicable requirements
of government regulators or agencies and Laws, and anticipated usefulness to
the
conduct of TXUED’s business.
Retention
Standards
|
1.
|
All
Records shall be retained for the period required by applicable
Laws.
|
|
2.
|
Adequate
Records shall be developed and maintained to document TXUED’s compliance
with all relevant Laws.
|
|
3.
|
All
Records necessary for business purposes shall be retained for a period
of
time that will reasonably assure the availability of those Records
when
needed.
|
|
4.
|
Records
vital to the ongoing operations of TXUED shall be identified and
appropriately safeguarded.
|
|
5.
|
Electronic
Records required for legal or business reasons shall be maintained
in a
retrievable format.
|
|
6.
|
All
Records not necessary for legal or business reasons and not required
to be
retained by Law shall be destroyed in order to reduce the high cost
of
storing, indexing and handling the vast amount of documents that
would
otherwise accumulate.
|
|
7.
|
Destruction
of Records shall take place only in compliance with this Policy in
order
to avoid any incorrect inference that any document was destroyed
in
anticipation of a specific problem.
|
|
8.
|
Documents
that are not otherwise subject to retention for business reasons
may need
to be retained because of unusual circumstances, such as litigation
or a
government or internal investigation. If for any reason it is believed
that an unusual circumstance exists or arises in which documents
should be
retained past their scheduled retention period, TXUED’s General Counsel
should be notified immediately. When litigation or an investigation
occurs, TXUED’s General Counsel or his or her designee will notify the
appropriate departments and direct that relevant categories of documents
be labeled for retention until further
notice.
|
Page
2 of
4
AMENDED
AND RESTATED EXHIBIT 12
MASTER
AGREEMENT
|
9.
|
The
privacy and security of Records shall be appropriately assured. (See
Sensitive
Employee Information and Sensitive Customer Information
Policy.)
|
|
10.
|
Records
such as notes, memoranda, letters, reports, laboratory notebooks,
computer
disks, tapes, etc., maintained in individual offices, at home, or
any
other off-site location are subject to this policy and shall be handled
accordingly.
|
Destroying
Records
Records
destruction will be scheduled and accomplished in the regular course of business
in compliance with the approved Records retention schedules and as set out
in
this Policy. Records are to be maintained only for their required retention
period. In case of a pending or imminent audit, litigation, or regulatory
investigation or proceeding, relevant Records will be held from destruction
for
such period as necessary until the issue is finalized and notice of termination
of any extended retention has been provided in writing. Records no longer
required for business or legal purposes should be discarded or destroyed in
accordance with this Policy.
Vendor
may request approval that Records be retained past the established destruction
date, provided a valid business reason exists for continued retention. Requests
for exceptions from this Policy must be supported by evidence that the basic
objections above will be met. Exceptions shall not be routinely granted, as
it
is vital to the proper and efficient use of the Policy to have regular
destruction of documents to avoid the inference of improper
destruction.
Roles
and Responsibilities
Vendor
is
accountable for maintaining, indexing, storing, reviewing, retrieving, and
destroying Records consistent with this Policy. Vendor shall comply with this
Policy and dedicate Resources sufficient for compliance.
Vendor shall:
|
▪
|
Actively
participate and support an ongoing analysis of active and inactive
Records;
|
|
▪
|
Counsel
Vendor Personnel so they understand the practices governing Records
generated or handled, and to properly retain or dispose of such Records;
|
|
▪
|
Assign
Vendor Personnel to actively coordinate the transition of Records
from
active to inactive status and process those Records to on-site or
off-site
storage or destruction;
|
|
▪
|
Keep
current an index of all Records and locations in a matter permitting
easy
access and retrieval;
|
|
▪
|
Ensure
that Records are periodically processed for storage or destruction
in
accordance with TXUED-approved Record retention
schedules;
|
|
▪
|
Maintain
a master list of TXUED-approved retention schedules for all types
or kinds
of Records; and
|
Page
3 of
4
AMENDED
AND RESTATED EXHIBIT 12
MASTER
AGREEMENT
|
▪
|
Conduct
an annual review of this Policy to ensure retention/destruction compliance
pursuant to Policy and department
requirements.
|
Vendor
Personnel shall:
|
▪
|
Comply
with restrictions concerning the sharing of confidential, proprietary,
and
material nonpublic information;
|
|
▪
|
Properly
retain and dispose of Records, including electronic information,
in
compliance with this Policy;
|
|
▪
|
Maintain
Records in such a manner as to allow for reasonable retrieval and/or
destruction; and
|
|
▪
|
Review
whether there is a business need to retain copies of any “FINAL” document.
Unless necessary to perform a day-to-day job function, if the individual
reasonably believes the “FINAL” document must be preserved pursuant to
this Policy, then all previous or working copies authored subsequent
to
the “FINAL” document should be deleted or destroyed as soon as
possible.
|
Implementation
If
a
question arises regarding the need to retain certain Records, the Records should
be retained until the question regarding retention is resolved.
Copies
of
Records, including correspondence, memoranda, notes, computer disks, tapes,
etc.
maintained in individual offices or any other off-site location are subject
to
this Policy and should not be retained in excess of this Policy.
Page 4
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