AFFILIATED TRANSACTIONS AGREEMENT
BETWEEN
UTILITY ENGINEERING CORPORATION
AND
PUBLIC SERVICE COMPANY OF COLORADO
This Affiliated Transactions Agreement is made and entered into this 29th
day of September, 1997, by and between Utility Engineering Corporation ("UE")
and Public Service Company of Colorado ("PSCo") (each individually a "Party,"
and collectively, "Parties").
WITNESSETH
WHEREAS, Parties are associate companies within the New Century Energies,
Inc. system and affiliates of one another.
WHEREAS, UE is a company that provides, among other things, engineering,
development, design, construction, and other related services.
WHEREAS, PSCo is a public utility company that provides electric and gas
services in the State of Colorado.
WHEREAS, Parties in accordance with the terms of this Agreement agree to
provide construction, goods, and services to one another, as those terms are
defined in Rule 80 of the rules of the Securities and Exchange Commission
("SEC") under the Public Utility Holding Company Act of 1935 ("SEC Rules").
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein contained, the Parties covenant and agree as follows:
ARTICLE I - SERVICES
Section 1.1 Upon the receipt of a written work order submitted by UE,
PSCo may provide any of the services specified in Attachment A to UE.
Section 1.2 The SEC has authorized UE to perform on behalf of PSCo
engineering, development, design, construction, and other related services. In
accordance with that authorization, UE will perform such activities on behalf
of PSCo upon the submission by PSCo to UE of a written work order. To the
extent that UE's provision of these services on behalf of PSCo requires that UE
obtain goods or materials from outside vendors and suppliers, UE shall
coordinate with PSCo to use its existing supply arrangements to the extent
possible or practicable. Moreover, in accordance with the terms of Attachment
B, PSCo authorizes UE to execute, enforce, and comply with certain written
instruments on its behalf.
Section 1.3 The determination of whether one company (the "Delivering
Party") has the available personnel and resources to perform a requested
service for another (the "Receiving Party") in accordance with a work order
will be entirely within the discretion of the Delivering Party: the Delivering
Party may at its sole option elect not to perform any requested service, except
that, once having agreed to perform a service, the Delivering Party shall not
withdraw or depart from such performance until completion, or upon less than 30
days notice in the case of services of a continuing nature, unless the
Receiving Party consents (with such consent not to be unreasonably withheld),
or emergency circumstances require, otherwise.
Section 1.4 The Receiving Party shall have the right from time to time to
amend, alter or rescind any work order provided that (i) any such amendment or
alteration that results in a material change in the scope of the services to be
performed or equipment to be provided is agreed to by the Delivering Party,
(ii) the cost for the services covered by the work order shall include any
expense incurred by the Delivering Party as a direct result of such amendment,
alteration or rescission of the work order, and (iii) no amendment, alteration
or rescission of a work order shall release the Receiving Party from liability
for all costs already incurred by or contracted for by the Delivering Party
pursuant to a work order, regardless of whether the services associated with
such costs have been completed.
Section 1.5 Companies intend that the relation between them created by
this Article I of this Agreement is that of employer-independent contractor.
No employee or agent of a Delivering Party while performing any requested
service shall be deemed to be an employee or agent of the Receiving Party. The
Receiving Party is interested only in the results obtained under this Article I
of this agreement. The manner and means of performing any requested services
are to be under the sole control of the Delivering Party, and the Delivering
Party in the provision of such services may arrange, where it deems
appropriate, for the services of such experts, consultants, advisers, vendors,
subcontractors and other necessary persons with necessary qualifications as are
required for or pertinent to the provision of such services. None of the
benefits provided by the Receiving Party to its employees, including, but not
limited to, workers' compensation insurance and unemployment insurance, are
available from the Receiving Party to the employees or agents of the Delivering
Party. The Delivering Party will be solely and entirely responsible for its
acts and for the acts of its employees and agents during the performance of any
services under this Article I.
Section 1.6 In performing services, the Delivering Party will exercise
due care to assure that the services are performed in an appropriate manner,
meet the standards and specifications set forth in the applicable work order,
and comply with applicable standards of law and regulation. However, failure
to meet these obligations shall in no event subject the Delivering Party to any
claims by or liabilities to the Receiving Party other than to reperform the
services and be reimbursed at the applicable rate specified in Article III for
such reperformance. The Delivering Party makes no other warranty with respect
to its performance of the services, and the Receiving Party agrees to accept
such services without further warranty of any nature.
2
ARTICLE II - LOANED EMPLOYEES AND LOANED EQUIPMENT
Section 2.1 At the request of either Party (the "Borrowing Party"), the
other Party (the "Loaning Party") may, but shall not be obligated to, loan
certain of the Loaning Party's employees (the "Loaned Employees") to the
Borrowing Party for the purposes of providing such services (consistent with
Section 1.1 where UE is the Borrowing Party and with Section 1.2 where PSCo is
the Borrowing Party), required by the Borrowing Party for the Borrowing Party
to meet its needs and obligations.
Section 2.2 At the request of the Borrowing Party, the Loaning Party may,
but shall not be obligated to, loan certain equipment (the "Loaned Equipment")
- including but not limited to, vehicles, machinery, and tools - to the
Borrowing Party for the Borrowing Party to meet its needs and obligations.
Section 2.3 The Loaning Party's obligation under this agreement to
provide Loaned Employees and Loaned Equipment to the Borrowing Party shall be
completely at the discretion of the Loaning Party and the times and duration of
use of Loaned Employees or Loaned Equipment by the Borrowing party shall at all
times be under the complete control of the Loaning Party.
Section 2.4 During any time that employees are loaned under this
agreement, the Borrowing Party shall have complete control over the work
activities of the Loaned Employees (subject to any restrictions specified by
the Loaning Party). Notwithstanding the foregoing, the Loaned Employees shall
remain the employees of the Loaning Party and shall be compensated by the
Loaning Party.
Section 2.5 During any time that equipment is loaned under this
agreement, the Borrowing Party shall have complete control over the use of the
Loaned Equipment (subject to any restrictions specified by the Loaning Party).
The Borrowing Party shall reimburse the Loaning Party for any damage to the
Loaned Equipment occurring while under the control of the Borrowing Party,
normal wear and tear excepted.
Section 2.6 The Parties shall make permanent records of all Loaned
Employees and Loaned Equipment, which records shall include the names of Loaned
Employees, the description of Loaned Equipment, the times that Loaned Employees
or Loaned Equipment are in fact loaned to a Borrowing Party, and the general
duties of the Loaned Employees during the periods of time such Loaned Employees
are under the control and direction of the Borrowing Party.
Section 2.7 The Borrowing Party shall exonerate, protect, indemnify,
defend, and hold harmless the Loaning Party from and against any and all
liabilities, expenses, claims, and damages of every kind, including, without
limitation, injury to or death of any person or persons (including the Loaned
Employees), and for damage to or loss of property, arising out of or
attributed, directly or indirectly, to operations, performance, or
nonperformance of Loaned Employees (while such Loaned Employees are under the
control of the Borrowing Party) under this agreement, irrespective of the legal
theory upon which any such claim or suit may be based.
3
Section 2.8 The Borrowing Party shall exonerate, protect, indemnify,
defend, and hold harmless the Loaning Party from and against any and all
liabilities, expenses, claims, and damages of every kind (including those
arising out of or attributed, directly or indirectly, to or resulting from any
and all acts or omissions of the Loaning Party, whether caused by the sole
negligence of the Loaning Party or by the concurrent negligence of the Loaning
Party), including, without limitation, injury to or death of any person or
persons, and for damage to or loss of property, arising out of or attributed,
directly or indirectly, to use of the Loaned Equipment under this agreement
and/or relating in any way to the Loaned Equipment (while such Loaned Equipment
is under the control of the Borrowing Party), irrespective of the legal theory
upon which any such claim or suit may be based.
Section 2.9 THE BORROWING PARTY ACKNOWLEDGES THAT IT HAS MADE ALL
INSPECTIONS OF THE LOANED EQUIPMENT IT DEEMS NECESSARY. EXCEPT AS OTHERWISE
EXPRESSLY SET FORTH IN THIS AGREEMENT THE BORROWING PARTY AGREES TO ACCEPT THE
LOAN OF THE LOANED EQUIPMENT "AS IS" AND "WHERE IS" AND THE LOANING PARTY MAKES
NO REPRESENTATION OR WARRANTY, WHETHER EXPRESS, IMPLIED, OR STATUTORY, AS TO
THE VALUE, CONDITION, SALABILITY, OBSOLESCENCE, MERCHANTABILITY, FITNESS OR
SUITABILITY FOR USE, OR WORKING ORDER OF THE LOANED EQUIPMENT.
ARTICLE III - COMPENSATION
Section 3.1 Where PSCo is the Receiving Party under Article I, it shall
pay UE as the Delivering Party "cost" for the provided services, with cost
determined in accordance with SEC Rule 91. Attachment C hereto, which may be
updated annually, specifies the cost-based rates that UE shall charge PSCo.
Section 3.2 Where PSCo is the Delivering Party under Article I, UE shall
pay PSCo for provided services a rate no less than cost, with cost determined
in accordance with SEC Rule 91.
Section 3.3 Where a Delivering Party provides goods, construction, or
services simultaneously on behalf of the Receiving Party and one or more
associate companies within the NCE system, the costs for such goods,
construction, or services shall be fairly and equitably distributed among the
Receiving Party and such other receiving associate companies using one or more
of the allocation ratios specified in Attachment B. The Delivery Party shall
specify the allocation ratio(s) to be used in the applicable work orders.
Section 3.4 By the 25th day of each month, each Company shall render an
invoice for all services provided by it to the other Company during the prior
month. Such invoices shall be paid within 30 days.
4
ARTICLE IV - TERM
Section 4.1 This Agreement shall become effective immediately upon its
execution, and shall continue in force until terminated by either Company, such
termination to be on not less than one year's prior written notice. Moreover,
in the event that it is determined that the terms of this Agreement conflict
with any regulatory requirement, Companies agree to negotiate in good faith to
modify the Agreement so as to comply with such requirements while preserving
the benefits of the Agreement to the greatest extent possible; provided,
however, that if the Companies cannot agree to such modifications, the
Agreement may be terminated immediately (although each Company shall remain
liable for any work already performed).
UTILITY ENGINEERING CORPORATION
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Date
Title: President
PUBLIC SERVICE COMPANY OF COLORADO
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Date
Title: Vice Chairman, President & COO
5
ATTACHMENT A
DESCRIPTION OF SERVICES TO BE PROVIDED BY
PUBLIC SERVICE COMPANY OF COLORADO TO UTILITY ENGINEERING
CORPORATION UNDER THE AFFILIATED TRANSACTIONS AGREEMENT
Substation construction, maintenance and operations
Substation engineering and support
Power plant facilities, equipment, tools, personnel
Plant engineering and support
Use of facilities and real property
6
ATTACHMENT B
APPROVAL AUTHORITY FOR COMMODITY SERVICES
The President and CEO of UE is hereby authorized to execute, enforce and
comply with all contracts, purchase orders, vouchers, or other documents
(collectively, "Documents") entered into on behalf of New Century Energy
"NCE's" Commodity Services organization up to a value of $1 million, and where
there is no extraordinary or precedent-setting feature (i.e., non-routine) of
the Documents. For Documents requiring authorization greater than this amount,
or where the Document is of extraordinary or precedent-setting nature,
Commodity Services' authorized executive or manager approval is required.
For ongoing Public Service Company of Colorado work only, and under UE's
President and CEO's delegatory authority granted by UE's board of directors,
the senior executive/General Manager of UEDenver is hereby authorized to
execute, enforce and comply with all Documents entered into on behalf of NCE's
Commodity Services organization up to a value of $500,000 and where there is
no extraordinary or precedent-setting feature of the Documents. For Documents
requiring authorization for greater than this amount, or where the Document is
of an extraordinary or precedent-setting nature, the previous paragraph
applies.
For ongoing Public Service Company of Colorado work only, and under UE's
President and CEO's delegatory authority granted by UE's board of directors,
UE Project Managers and Managers, up to a value of $100,000, are authorized to
execute, enforce and comply with all Documents falling within UE's Vice
President and Chief Operating Officer or senior executive/General Manager of
UEDenver's signature authorities above.
7
