INTEGRATED SUPPLY AGREEMENT
This Integrated Supply Agreement ("Agreement") is made and entered into
as of this the 15th day of November, 1996, by and between Cap Rock Electric
Corporation, Inc., ("Cap Rock") a Texas corporation with its principal office
at 000 Xxxx Xxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000, and Temple Inc.,
("Temple") a Texas corporation with its principal office at 0000 Xxxxxx X,
Xxxxx Xxxxxxx Xxxxx 00000.
Cap Rock operates a centralized warehouse facility in Stanton, Texas
("Stanton Facility"). It desires to utilize the services of a company to
manage the procurement of the utility and other related products which it
requires at its Xxxxxxx Facility and other locations. Temple is presently one
of the suppliers of such products to Cap Rock and has the ability to provide
the needed assistance. Accordingly, in return for the mutual covenants set
forth below, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows;
1. SERVICE TO BE PROVIDED BY TEMPLE. During the term of this Agreement,
Temple will take all action necessary to manage the procurement of all
utility and other related products that are required by Cap Rock ("Utility
Products"). In connection with such service, Temple shall assume the
responsibility for monitoring the inventory levels of Utility Products and
when particular products are required, Temple shall procure such products,
warehouse them at the Xxxxxxx Facility or other convenient locations, and
thereafter supply them to Cap Rock in a timely manner as needed.
2. AUTHORIZATION OF CAP ROCK. Cap Rock hereby designates Temple as its
exclusive supplier for all Utility Products required, by Cap Rock and
authorizes to monitor and maintain inventories of such products at levels
which Temple determines appropriate and consistent with industry standards or
with respect to which the parties otherwise agreed. Cap Rock shall take all
action required to assist Temple in monitoring and maintaining the level of
inventories and shall promptly furnish Temple with any information regarding
such products which Temple may reasonably request.
3. TEMPLE PERSONNEL. In order to perform its duties, Temple will employ,
and station at the Xxxxxxx Facility, sufficient Temple personnel to (i)
properly monitor all applicable inventoried at the facility, (ii) purchase
all Utility Products that arc needed in order to maintain inventory supplies
at appropriate levels, and (iii) supply the operations of Cap
Rock with required products in a timely and efficient manner. Although the
personnel of Temple shall be stationed at the facility of Cap Rock, they
shall remain under the direction and control of Temple at all times and shall
not in any way be considered employees of Cap Rock or joint employees of Cap
Rock and Temple. Temple shall indemnify and hold Cap Rock harmless for any
and all claims by Temple employees arising out of their performance of the
obligations of Temple undertaken pursuant to this Agreement.
4. CONDUCT OF PERSONNEL. Notwithstanding the foregoing, and in addition
to its own requirements, Temple shall cause all of its employees to comply
with any personnel rules and regulations which arc published by Cap Rock
relating to activities at the Xxxxxxx Facility. If requested by Cap Rock,
Temple Shall cause such employees to follow any drug and alcohol test or
screening procedure required by Cap Rock of its own employees. Temple shall
remove any employee who fails to pass a drug or alcohol test or screen or who
is otherwise reasonably objectionable to Cap Rock.
5. SPACE AT XXXXXXX FACILITY. Cap Rock shall set aside and secure for
the exclusive use of Temple and its employees, for a rental fee of $500.00
per month, a mutually agreed upon portion of the Xxxxxxx Facility. Such space
shall be used by Temple as it deems appropriate to carry out its duties
hereunder. In using the space, Temple shall at all times comply with all
applicable laws relating to human health, safety and the environment. Temple
shall pay for its proportional part of property taxes due with respect to the
space but all utility and property insurance costs related thereto shall be
borne by Cap Rock.
6. STORAGE OF PRODUCTS. As required by the terms of this Agreement,
Temple shall purchase Utility Products when and as such products are needed
to maintain inventories at levels which Temple deems appropriate for the
operations of Cap Rock and are consistent with industry standards or at
levels that are otherwise agreed upon from time to time by the parties.
7. COOPERATION REGARDING DELIVERIES. The parties shall regularly
communicate and cooperate regarding the delivery of products. In the event
that products are needed for emergency or special projects, or in a manner
that is not in the normal course of business, Cap Rock shall inform Temple of
that fact as soon as reasonably practicable. Following such information
regarding an emergency or a special project, Temple shall use its best
efforts to arrange for the delivery of needed products in a timely manner.
8. TITLE TO PRODUCTS. Title to products placed in storage shall remain
with Temple until actual possession is transferred to Cap Rock or to a third
party for the benefit of Cap Rock. Temple shall cover stored products with
fire and other forms of property insurance as
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Temple may deem necessary but all risk of loss for each stored product shall
remain with Temple until the product is delivered, provided, however, that
Cap Rock shall indemnify and hold Temple harmless from any loss or damage to
products caused by the negligence or other wrongdoing of Cap Rock or those
for whom it is legally responsible.
9. PRICE AND PAYMENT. Cap Rock shall purchase all of its requirements
for Utility Products from Temple under the terms hereof. The price of
products shall be the weighted average actual cost of such products to Temple
plus thirteen and one-half percent (13 1/2%) to cover Temple's cost of
carrying out the terms hereof. The parties shall cooperate regarding all
efficient method of invoicing but all amounts due Temple, together with any
applicable sales or other similar taxes, shall be paid to Temple at its
principal office in Grand Prairie, Dallas County, Texas "net thirty (30)
days".
(As used in this Agreement the phrase "weighted average actual
cost" shall mean the average of the actual cost to Temple of products
transferred to Cap Rock hereunder based on the cost of such products
determined at the storage locations from which they were transferred
[including the cost of freight if mutually agreed to by the parties] weighted
by the quantity of such products purchased.)
Temple shall supply Cap Rock with monthly and annual reports of
purchases reflecting the weighted average actual cost of applicable products
and the additional percentage mentioned above. Further, Cap Rock shall have
the right, on reasonable notice, to inspect any relevant books and records of
Temple in order to verify price and other pertinent information.
The parties will review the pricing terms of this Agreement on an
annual basis and will make any adjustments which they mutually determine are
appropriate.
10. WARRANTIES OF PRODUCTS. Temple hereby assigns to Cap Rock all
product warranties received from suppliers with respect to products delivered
hereunder. Temple further warrants that it will transfer good and marketable
title to Cap Rock of such products, free and clear of all liens, claims and
encumbrances.
11. ALLOCATION OF RESPONSIBILITY. Neither party shall be liable to the
other for indirect or consequential damages relating to their performance
under this Agreement, or any products delivered hereunder, including, without
limitation, any indirect or consequential damages caused by or arising out
of, in whole or in part, any negligent or willful act or omission. Without
limiting the generality of the foregoing, nothing in this Agreement shall
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render either party liable to the other with respect to liabilities to third
parties or with respect to loss or production, loss of profits or loss of
business.
12. INSURANCE. Temple shall maintain, at its cost, commercial general
liability insurance with limits of liability of not less than Two Million and
No/100 Dollars ($2,000,000.00) per occurrence and including liability
coverage for bodily injury or property damage. Temple shall also maintain
statutory Worker's Compensation coverage, and Employees' Liability Insurance
in the amount of One Million and No/100 Dollars ($1,000,000.00) per
occurrence. Temple shall supply Cap Rock with copies of certificates of
insurance evidencing such coverage and, with respect to its liability
coverage, Temple shall name Cap Rock as an additional insured.
13. EXCUSED NON-PERFORMANCE. Notwithstanding any other term hereof, any
failure, in whole or in part, by Temple to timely perform any of its
obligations hereunder shall be excused to the extent that such failure is
caused by any circumstance or condition which is not within the reasonable
Control of Temple including without limitation, any act of God, flood or
other natural calamity, war, riot, transportation strike or other similar
problem, or the failure or refusal of a reputable product supplier, without
cause, to supply Temple in a manner that has been contractually agreed upon
between Temple and the supplier.
14. TERM AND TERMINATION. This Agreement shall commence on the date
hereof and shall continue for a period of five (5) years and Temple shall
actively begin to implement the process of supplying products hereunder as of
the date hereof. It will be automatically renewed at the end of the initial
and each subsequent term for an additional period of five (5) years, unless
either party notifies the other at least thirty (30) days prior to the end of
a particular term that such party does not wish to renew. Notwithstanding the
foregoing, either party may terminate this Agreement at any time and for any
reason upon at least ninety (90) days advance written notice of termination.
Within thirty (30) days following any termination of this
Agreement, Cap Rock shall purchase and pay for all stored Utility Products
that have been acquired by Temple under the terms hereof for the weighted
average actual cost of such products plus ten percent (10%). The purchase of
such products by Cap Rock shall be limited to products then on hand or on
order from manufacturers as of the date of termination; provided, however,
that if Temple provides such products to other customers Cap Rock shall only
be responsible for purchasing that portion of such products which arc
represented by its normal purchases. Notwithstanding the foregoing, Gap Rock
shall purchase all products required and used exclusively by Cap dock and all
used and retired products then in storage hereunder.
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15. ASSISTANCE. If requested in writing at or following termination, and
in addition to the foregoing, Temple shall take all commercially reasonable
action for a reasonable period of time necessary to assist Cap Rock in
establishing its own purchasing and warehousing operations. At the time of
termination, both parties shall execute non-disclosure agreements regarding
the events surrounding termination and both agree to avoid any action or any
statements, not legally required, which could adversely affect the business
reputation of the other.
16. CONFIDENTIAL INFORMATION. Each party shall obtain access to
confidential information of the other during the term hereof and each party
hereby agrees to keep secret such information and to take all commercially
reasonable precautions to prevent the unauthorized disclosure thereof,
provided, however, that the foregoing shall not apply to information that
becomes publicly available through no fault of the receiving party or is
required to be disclosed in a judicial proceeding. The foregoing shall not
prevent Temple from disclosing details of this arrangement as may be
necessary to establish business relationship with new suppliers or to obtain
lower prices of products. Each party shall keep the reasons for any
termination of this Agreement confidential.
17. COMPLIANCE WITH LAWS. Both Temple and Cap Rock shall comply with all
applicable laws regulating their respective activities hereunder, including
without limitation, all federal, state and local laws relating to their
employees and the workplace. Each party shall indemnify and hold the other
party, and their officers and employees, harmless from any loss, damage or
expense arising from any demands, claims, or causes of action brought against
such other party, or their officers or employees, as a result of a breach by
the indemnify party of the terms of this Section.
18. INDEPENDENT CONTRACTOR. In performing its duties under this
Agreement, Temple shall be deemed an independent contractor for all purposes
and all persons employed by Temple shall be deemed its employees. Temple
shall be responsible for all costs and liabilities associated with its
employees, including all taxes or other similar payments related to their
employment. While Cap Rock shall be entitled to establish rules for the safe
and efficient operation of the Xxxxxxx Facility, Temple shall be in exclusive
control of the manner of carrying our its performance hereunder.
19. INDEMNIFICATION. In addition to other similar provisions set forth
elsewhere in this Agreement, each party agrees to indemnify and hold the
other party, and their officers and employees harmless from any loss, damage
or expense arising from any demands, claims, or causes of action brought
against such other party, or their officers or employees, as a result of the
activities of the indemnify party hereunder, to the full extent of their
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responsibility including, without limitation, those instances in which it
alleged or proven that the other party was also partially responsible for the
matter underlying such demand, claim or cause of action.
20. ASSIGNMENT. This Agreement shall not be assignable by either party
without the prior written consent of the other party; provided, however, that
the foregoing shall not apply to any assignment made to a corporate affiliate
as a part of a corporate restructuring.
21. NOTICE. Any notice or other communication required or permitted to
be given pursuant to this Agreement shall be in writing and shall be deemed
to have been duly given if delivered personally or sent by facsimile
transmission or certified mail, postage prepaid, return receipt requested,
addressed as herein below provided, until another address or addresses shall
be furnished in writing to either party.
To Temple:
Temple, Inc.
0000 Xxxxxx X
Xxxxx Xxxxxxx, Xxxxx 00000
To Cap Rock:
Cap Rock Electric Cooperative, Inc.
000 Xxxx Xxxx, Xxxx 000
Xxxxxxx, Xxxxx 00000
22. ARBITRATION. Any dispute arising between the parties regarding this
Agreement or their performance hereunder shall be resolved exclusively by
binding arbitration before a panel of three (3) neutral arbitrators in
Dallas, Texas, pursuant to the applicable commercial rules of the American
Arbitration Association. Each of the arbitrators shall be a partner or the
equivalent of a "Big Six" international accounting firm which has not
performed work for either of the parties. Each party shall be entitled to
select one (1) arbitrator and the individuals thus selected shall jointly
designate the remaining arbitrator. The decision of a majority of the
arbitrators shall be binding and enforceable in any court of competent
jurisdiction. The prevailing party shall be entitled to reasonable attorney's
fees. In addition to any powers that they may have by law, the arbitrators
shall have the power to issue orders of injunctions and other forms of
extraordinary relief. This provision shall survive the termination of this
Agreement regardless of the reach for termination.
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23. ENTIRE AGREEMENT. This documents sets forth the entire understanding
between the parties regarding the subject matter hereof and shall not be
altered or modified in any way other than by a written document executed by
both parties.
24. NO WAIVER. No Waiver of any right under this Agreement shall be
presumed from the inaction or a course of conduct of the parties. The only
manner in which rights may be waived is in writing executed by both parties.
25. GOVERNING LAW. This Agreement shall be governed and controlled by
the laws of the State of Texas, considered without regard to choice of law
rules.
26. DUPLICATE COPIES. This Agreement may be executed simultaneously in
two or more counterparts, each of which shall be deemed an original, but all
of which together shall Constitute one and the same instrument.
Dated and executed as of the date set forth above.
Temple, Inc.
By:/s/ Xxxxxxx X. Xxxx
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Its: VP & CFO
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Cap Rack Electric Cooperative, Inc.
By: /s/ Ulen North Jr.
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Its: VP/COO
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