MASTER SERVICES AGREEMENT between WASHINGTON GAS LIGHT COMPANY and ACCENTURE LLP June 19, 2007
Exhibit 10.1
between
WASHINGTON GAS LIGHT COMPANY
and
ACCENTURE LLP
June 19, 2007
CERTAIN CONFIDENTIAL INFORMATION HAS BEEN OMITTED FROM THIS EXHIBIT PURSUANT TO A CONFIDENTIAL
TREATMENT REQUEST THAT HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE
24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. THE OMITTED INFORMATION IS
INDICATED BY THE SYMBOL “***” AT EACH PLACE IN THIS EXHIBIT WHERE THE REDACTED INFORMATION APPEARS
IN THE ORIGINAL.
TABLE OF CONTENTS
| 1. | Definitions; Construction of Terms | |||||||||
| 2. | Scope of Services | |||||||||
| 2.1 | Services; Additions | |||||||||
| 2.2 | Additional Services | |||||||||
| 2.2.1 | New Services | |||||||||
| 2.2.2 | New Affiliates | |||||||||
| 2.3 | Order of Precedence | |||||||||
| 2.4 | Services Inclusive | |||||||||
| 2.5 | Non-Exclusive Agreement | |||||||||
| 2.6 | Transition Plans | |||||||||
| 2.7 | Provision of Services | |||||||||
| 2.7.1 | Affiliates | |||||||||
| 2.7.2 | Service Locations | |||||||||
| 2.7.3 | Safety and Physical Security Procedures | |||||||||
| 2.8 | WG Corporate Policies | |||||||||
| 2.9 | Contract Administration | |||||||||
| 2.9.1 | Service Provider Responsibilities | |||||||||
| 2.9.2 | Third Party Invoices | |||||||||
| 2.9.3 | Assigned Agreements | |||||||||
| 2.9.4 | No Additional Charges | |||||||||
| 2.9.5 | Appointment as Agent | |||||||||
| 2.9.6 | Service Provider’s Payment on WG’s Behalf | |||||||||
| 2.10 | Services Procedure Manual | |||||||||
| 3. | Service Provider Commitments | |||||||||
| 3.1 | Capital | |||||||||
| 3.2 | Equipment and Transferred Assets | |||||||||
| 3.2.1 | Service Provider Equipment | |||||||||
| 3.2.2 | Transferred Assets | |||||||||
| 3.3 | Personnel and Facilities | |||||||||
| 3.4 | Improvements | |||||||||
| 3.5 | New Technology and Re-engineering | |||||||||
| 4. | Term | |||||||||
| 4.1 | Term of the Agreement | |||||||||
| 4.2 | Term of Work Agreements; Renewals | |||||||||
| 5. | Pricing | |||||||||
| 5.1 | Prices for Services | |||||||||
| 5.2 | Price Adjustments | |||||||||
| 5.3 | Incidental Expenses | |||||||||
| 5.4 | Reimbursable Expenses | |||||||||
| 5.5 | Service Provider’s Billing Rates | |||||||||
(i)
| 5.6 | Tax Obligations | |||||||||
| 6. | Invoicing and Payment | |||||||||
| 6.1 | Monthly Payments | |||||||||
| 6.2 | Payment | |||||||||
| 6.3 | Intentionally Omitted | |||||||||
| 6.4 | Adjustments to Invoiced Amounts | |||||||||
| 6.5 | Records and Audit | |||||||||
| 6.6 | Service Level Credits and Milestone Default Credits | |||||||||
| 6.7 | Disputed Charges | |||||||||
| 7. | Acceptance | |||||||||
| 7.1 | Acceptance Testing | |||||||||
| 7.2 | Failure of Acceptance Testing for Submitted Items | |||||||||
| 7.2.1 | ||||||||||
| 7.2.2 | ||||||||||
| 7.3 | Failure to Meet Deliverables | |||||||||
| 7.4 | Acceptance of Transition Submittals | |||||||||
| 8. | Performance Measurement for Support Services | |||||||||
| 8.1 | Performance of Services | |||||||||
| 8.2 | Modification of Service Levels | |||||||||
| 8.3 | Measurement and Monitoring Tools for Service Levels | |||||||||
| 8.4 | Failure to Meet Service Levels | |||||||||
| 8.5 | Failure to Meet Critical Milestones | |||||||||
| 8.6 | Root Cause Analysis | |||||||||
| 8.7 | Commitment of Commercially Reasonable Efforts | |||||||||
| 9. | Benchmarking | |||||||||
| 10. | Change Management Process | |||||||||
| 10.1 | Changes | |||||||||
| 10.2 | Mandatory Changes | |||||||||
| 11. | Project and Relationship Management | |||||||||
| 11.1 | Contract Governance | |||||||||
| 11.2 | Failure to Act | |||||||||
| 11.3 | Other Providers | |||||||||
| 12. | Service Provider Personnel and Subcontractors | |||||||||
| 12.1 | Key Personnel | |||||||||
| 12.1.1 | Generally | |||||||||
| 12.1.2 | Time and Effort | |||||||||
| 12.1.3 | Replacements | |||||||||
| 12.1.4 | Replacement Transition | |||||||||
| 12.2 | Personnel. | |||||||||
| 12.2.1 | Qualified Personnel | |||||||||
(ii)
| 12.2.2 | Withdrawal/Replacement | |||||||||
| 12.2.3 | Notification and Replacement | |||||||||
| 12.2.4 | Compliance | |||||||||
| 12.2.5 | Screening and Background Checks | |||||||||
| 12.2.6 | Visas and Immigration Requirements | |||||||||
| 12.3 | No Third Party Beneficiaries | |||||||||
| 12.4 | Transfer of WG Personnel | |||||||||
| 12.5 | Service Provider’s Use of Subcontractors and Third Party Suppliers | |||||||||
| 12.5.1 | Subcontractors | |||||||||
| 12.5.2 | Third Party Services | |||||||||
| 12.5.3 | Service Provider’s Responsibility for Subcontractors | |||||||||
| 13. | Audit and Inspection Rights | |||||||||
| 14. | Business Continuity and Disaster Recovery | |||||||||
| 14.1 | Business Continuity Plan | |||||||||
| 14.2 | Implementation of Business Continuity Plan | |||||||||
| 14.3 | Testing of Business Continuity Plan | |||||||||
| 15. | Confidentiality | |||||||||
| 15.1 | Duty of Confidentiality | |||||||||
| 15.2 | Exclusions to Confidential Information | |||||||||
| 15.3 | Permitted Disclosures | |||||||||
| 15.4 | Confidentiality Agreements | |||||||||
| 15.5 | Data Protection | |||||||||
| 15.6 | Strictest Treatment | |||||||||
| 15.7 | Remedy | |||||||||
| 15.8 | Attorney Client Privilege/Work Product | |||||||||
| 15.9 | No Right or License | |||||||||
| 16. | Data and Information Security | |||||||||
| 16.1 | Safeguarding of WG Data | |||||||||
| 16.2 | Provision of WG Data | |||||||||
| 16.3 | Ownership and Use of WG Data | |||||||||
| 16.4 | Data Retention | |||||||||
| 16.4.1 | During Term | |||||||||
| 16.4.2 | Post-Term | |||||||||
| 17. | Intellectual Property | |||||||||
| 17.1 | WG Intellectual Property | |||||||||
| 17.1.1 | Trademarks and Service Marks | |||||||||
| 17.1.2 | WG Intellectual Property | |||||||||
| 17.1.3 | WG Work Product | |||||||||
| 17.1.4 | Service Provider’s Subcontractors | |||||||||
| 17.2 | Service Provider Intellectual Property | |||||||||
| 17.2.1 | Service Provider Intellectual Property | |||||||||
| 17.2.2 | Deliverables | |||||||||
(iii)
| 17.3 | Disclosure and Delivery of All Deliverables and Work Product | |||||||||
| 17.4 | No Other Licenses | |||||||||
| 17.5 | Service Provider and Third Party Intellectual Property | |||||||||
| 17.6 | Inventions | |||||||||
| 17.7 | Residual Rights | |||||||||
| 18. | Representations, Warranties and Covenants | |||||||||
| 18.1 | Service Provider Representations, Warranties and Covenants | |||||||||
| 18.1.1 | Authorization | |||||||||
| 18.1.2 | Professional Services | |||||||||
| 18.1.3 | Employees | |||||||||
| 18.1.4 | Non-Infringement | |||||||||
| 18.1.5 | No Unlawful or Unauthorized Actions | |||||||||
| 18.1.6 | Viruses/Disabling Code | |||||||||
| 18.1.7 | New Software | |||||||||
| 18.1.8 | Continuing Warranties | |||||||||
| 18.2 | WG Representations, Warranties and Covenants | |||||||||
| 18.2.1 | Authorization | |||||||||
| 18.2.2 | Non-Infringement | |||||||||
| 18.2.3 | No Unauthorized Actions | |||||||||
| 18.2.4 | Viruses/Disabling Code | |||||||||
| 18.2.5 | Continuing Warranties | |||||||||
| 18.3 | Disclaimer | |||||||||
| 18.4 | Compliance with Laws | |||||||||
| 18.4.1 | WG Compliance | |||||||||
| 18.4.2 | Service Provider Compliance | |||||||||
| 18.4.3 | Material Impact on Changes of Law | |||||||||
| 18.4.4 | Notification | |||||||||
| 18.4.5 | Miscellaneous | |||||||||
| 19. | Indemnification | |||||||||
| 19.1 | Service Provider’s Indemnity | |||||||||
| 19.1.1 | General | |||||||||
| 19.1.2 | Intellectual Property | |||||||||
| 19.1.3 | Limitations | |||||||||
| 19.1.4 | Duty to Correct | |||||||||
| 19.1.5 | Third Party Indemnities | |||||||||
| 19.2 | WG’s Indemnity | |||||||||
| 19.2.1 | ||||||||||
| 19.2.2 | Intellectual Property | |||||||||
| 19.2.3 | Limitations | |||||||||
| 19.2.4 | Third Party Indemnities | |||||||||
| 19.3 | General Provisions and Procedures | |||||||||
| 19.3.1 | Notice | |||||||||
| 19.3.2 | Counsel | |||||||||
| 19.3.3 | Settlement | |||||||||
| 19.3.4 | Third Party Losses | |||||||||
(iv)
| 20. | Limitations of Liability | |||||||||
| 20.1 | Limitation on Direct Damages | |||||||||
| 20.2 | Aggregate Liability | |||||||||
| 20.3 | Exclusion of Consequential Damages and Certain Other Damages | |||||||||
| 20.4 | Exceptions | |||||||||
| 20.5 | Force Majeure | |||||||||
| 20.5.1 | Force Majeure Events | |||||||||
| 20.5.2 | Business Continuity Plan | |||||||||
| 20.6 | Duty to Mitigate | |||||||||
| 21. | Insurance | |||||||||
| 21.1 | Service Provider Insurance Coverage | |||||||||
| 21.1.1 | Workers’ Compensation | |||||||||
| 21.1.2 | Commercial General Liability | |||||||||
| 21.1.3 | Automobile Liability | |||||||||
| 21.1.4 | Crime | |||||||||
| 21.1.5 | Professional Liability | |||||||||
| 21.1.6 | Excess Liability | |||||||||
| 21.1.7 | Property Coverage | |||||||||
| 21.2 | Certificates | |||||||||
| 21.3 | [***] | |||||||||
| 21.4 | Change in A.M. Best Rating | |||||||||
| 22. | Dispute Resolution Process | |||||||||
| 22.1 | Informal Dispute Resolution | |||||||||
| 22.2 | Formal Proceedings | |||||||||
| 22.3 | Equitable Relief | |||||||||
| 22.4 | Choice of Law | |||||||||
| 22.5 | Waiver of Jury Trial | |||||||||
| 23. | Termination | |||||||||
| 23.1 | Termination by WG | |||||||||
| 23.1.1 | Termination for Convenience | |||||||||
| 23.1.2 | Cap Refresh | |||||||||
| 23.1.3 | Termination for Cause | |||||||||
| 23.1.4 | Change of Control of Service Provider | |||||||||
| 23.1.5 | Services to Former Affiliates; Termination for Change of Control of WG. | |||||||||
| 23.1.6 | Termination for Insolvency or Bankruptcy | |||||||||
| 23.1.7 | Termination for Benchmarking | |||||||||
| 23.1.8 | Termination for Force Majeure | |||||||||
| 23.1.9 | Cross-Termination | |||||||||
| 23.1.10 | Partial Termination | |||||||||
| 23.1.11 | Extension of Termination Effective Date | |||||||||
| 23.2 | Termination by Service Provider | |||||||||
| 23.2.1 | Termination for Convenience | |||||||||
| 23.2.2 | Termination for WG's Failure to Pay | |||||||||
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED.
ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
(v)
| 23.3 | Effect of Termination | |||||||||
| 23.4 | Termination/Expiration Assistance | |||||||||
| 23.5 | Equitable Remedies | |||||||||
| 23.6 | Service Provider Employees and Contracts | |||||||||
| 23.7 | Service Provider Subcontractors | |||||||||
| 24. | General | |||||||||
| 24.1 | Entire Agreement | |||||||||
| 24.2 | Assignment | |||||||||
| 24.3 | Notices | |||||||||
| 24.4 | Third Party Notice | |||||||||
| 24.5 | Expenses | |||||||||
| 24.6 | Relationship of the Parties | |||||||||
| 24.7 | Severability | |||||||||
| 24.8 | Consents and Approval | |||||||||
| 24.9 | Waiver of Default | |||||||||
| 24.10 | Remedies Cumulative | |||||||||
| 24.11 | Survival of License in Bankruptcy | |||||||||
| 24.12 | Survival of Obligations | |||||||||
| 24.13 | Media Releases | |||||||||
| 24.14 | Third Party Beneficiaries | |||||||||
| 24.15 | Compliance with Export/Import Control Laws | |||||||||
| 24.16 | Compliance with Foreign Corrupt Practices Act | |||||||||
| 24.17 | Further Assurances | |||||||||
| 24.18 | Calculation of Days | |||||||||
| 24.19 | Headings and Appendices; Construction | |||||||||
| 24.20 | Counterparts | |||||||||
| 24.21 | Strategic Alliances | |||||||||
(vi)
APPENDICES
Appendix 1
|
WG Corporate Policies | |
Appendix 2
|
Data Security and Information Protection Policies | |
Appendix 3
|
Health, Safety, Physical Security and Welfare Policies | |
Appendix 4
|
Form of Work Agreement | |
Appendix 5
|
Taxes | |
Appendix 6
|
Data Security Procedures | |
Appendix 7
|
Benchmarking | |
Appendix 8
|
Service Level Methodology | |
Appendix 9
|
Form of Assignment and Assumption | |
Appendix 10
|
Audit Procedures | |
Appendix 11
|
Definitions | |
Appendix 12
|
Governance | |
Appendix 12.1
|
Change Request Procedures | |
Appendix 13
|
Disaster Recovery and Business Continuity | |
Appendix 14
|
Affiliate Acknowledgement | |
Appendix 15
|
Service Provider Parent Guarantee |
(vii)
This Master Services Agreement is made and entered into as of June 19, 2007 (the “Execution
Date”), by and between WASHINGTON GAS LIGHT COMPANY, a District of Columbia and Virginia
corporation (“WG”), and ACCENTURE LLP, an Illinois limited liability partnership (“Service
Provider”).
WHEREAS, Service Provider is a reputable, industry leading, information technology and
business process outsourcing provider;
WHEREAS, WG desires Service Provider to provide and Service Provider desires to provide,
certain outsourcing, professional and other services to WG and its Affiliates;
WHEREAS, Service Provider desires to provide such services, for a reasonable profit, in
accordance with the terms of this Agreement;
WHEREAS, the Parties’ specific goals and objectives for the services are to:
| (i) | establish a delivery process that provides value and is responsive to the demands of WG’s business, and to changes in the industry and business environment, in technology and in methods for providing services; | ||
| (ii) | leverage Service Provider’s business processes, information technology services, and integration capabilities to enhance the quality of the services required to be provided while identifying opportunities for savings and maintaining and improving the quality of the services as set forth in this Agreement; | ||
| (iii) | provide the services and solutions in a manner that is flexible, cost effective and efficient, at a reduced cost to WG, with predictable pricing and in full alignment with business unit and regulatory requirements as set forth in this Agreement; | ||
| (iv) | provide for the orderly transfer of responsibility of certain functions and processes from WG to Service Provider; | ||
| (v) | maintain and continuously enhance a strong internal controls environment; and | ||
| (vi) | have WG and its Third Party Providers deliver the enabling capabilities and resources for which WG and its Third Party Providers are responsible as set forth in this Agreement and that are required for WG and Service Provider to perform their obligations. |
The foregoing recitals are intended to be a general introduction to this Agreement and are not
intended by either Party to be binding, expand the scope of either Party’s obligations, or alter
the terms and conditions of this Agreement. However, if the terms and conditions of this Agreement
do not address a particular circumstance or are otherwise unclear or ambiguous, the recitals set
forth above shall assist in interpreting and construing such terms and conditions but only to the
extent the contract terms do not address a particular circumstance or are otherwise unclear or
ambiguous.
NOW, THEREFORE, Service Provider agrees to provide such services to WG and its Affiliates, and
WG agrees to purchase such services from Service Provider, on the terms and conditions set forth in
this Agreement and in consideration of the covenants and promises contained in this Agreement and
for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged.
1. Definitions; Construction of Terms.
Terms used herein with initial capital letters shall have the respective meanings set forth in
Appendix 11. The definitions of terms herein shall apply equally to the singular and
plural forms of the terms defined.
2. Scope of Services
2.1 Services; Additions.
Pursuant to the terms and conditions of this Agreement, Service Provider shall provide to WG
the Services, which will be described in Work Agreements, the form of which is attached hereto as
Appendix 4. Services may be modified from time to time during the Term in accordance with
the procedures for Changes set forth in Appendix 12.1. Service Provider shall not have the
right to cease provision of the Services (in whole or in part) except as expressly provided in this
Agreement.
2.2 Additional Services
2.2.1 New Services.
If WG or its Affiliates elect to outsource services similar to the Services, Service
Provider shall provide the New Services in accordance with this Agreement to the extent
applicable, [***]. Any New Services (including the Transition Plan related thereto) shall
be set forth in a Change Order or in a new Work Agreement that is executed by the Parties
during the Term.
2.2.2 New Affiliates.
If WG requests that Service Provider provide some or all of the Services for a New
Affiliate, Service Provider will provide such New Affiliate with the Services. As part of
its obligation under this Section 2.2.2, Service Provider shall propose a
transition plan and schedule for implementation of the Services to be provided to such New
Affiliate. The Service Provider may charge WG for the initial set-up, transition and
implementation charges allocable to such New Affiliate (determined on a commercially
reasonable basis consistent with the other Charges), unless such Charges are specifically
identified in the applicable Work Agreement, and shall charge WG for the performance and
delivery of the Services allocable to such New Affiliate, based on the existing charging
methodologies for increases or decreases in the Charges due to increases or reductions in the quantity of the Services used by WG.
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
2
2.3 Order of Precedence.
The Parties contemplate that they may enter into additional Work Agreements during the term of
this Master Services Agreement. The Parties intend that this Agreement govern the relationship of
the Parties to the extent practicable, with Work Agreements intended to specify the particular
Services to be provided. In case of ambiguity or conflict between the terms and conditions of the
body of this Master Services Agreement or an Appendix, on the one hand, and a Work Agreement, on
the other hand, the terms and conditions of the body of this Master Services Agreement or the
applicable Appendix shall control, except to the extent the Parties wish to supersede a term or
condition of the body of this Master Services Agreement or an Appendix in connection with the
provision of a particular Service, in which case the applicable Work Agreement shall expressly
reference such term or condition. A subsequent Work Agreement shall supersede any and all prior
agreements or understandings in a prior Work Agreement with respect to the Services described
therein. In case of an ambiguity or conflict between the terms and conditions of the body of this
Master Services Agreement and an Appendix, the terms and conditions of the body of this Master
Services Agreement shall control, except to the extent the Parties wish to supersede a term or
condition of the body of this Master Services Agreement in a particular Appendix, in which case the
applicable Appendix shall expressly reference such term or condition. For purposes of this
Section 2.3, the definitions in Appendix 11 shall be deemed to be a part of the
body of this Master Services Agreement.
2.4 Services Inclusive.
The Services consist of the tasks and functions set forth in the Work Agreements, the
functions and activities set forth in this Article 2 and, [***] activities, tasks and
responsibilities that are (i) [***] for Service Provider to provide to Service Provider’s other
customers that are [***] as the Services from a Service Provider shared service delivery location,
(ii) inherent or necessary as part of the Services, or (iii) reasonably necessary for the proper
performance of the Services.
2.5 Non-Exclusive Agreement.
WG may engage, and enter into relationships with, third party entities providing any services,
including any services the same as or comparable to the Services. Subject to the termination
provisions set forth in Article 23 or in any Work Agreement, WG may at any time, in-source
or obtain any or all of the Services from one or more third parties. Each Party acknowledges and
agrees that the execution of this Agreement is not a guarantee of (i) future work or (ii) minimum
payment (subject to such payment obligations set forth in the applicable Work Agreement). If WG
acquires a product or service in a category of spend that is included in the Savings Calculation
Methodology in Work Agreement No. 1, such acquisition will be dealt with in the manner as set forth
in the Savings Calculation Methodology.
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
3
2.6 Transition Plans.
Each Work Agreement shall include, if applicable, a Transition Plan for Services provided
under such Work Agreement. The Transition Plan for a Work Agreement shall include a transition
approach and transition project plan with, as and to the extent set forth in the applicable Work
Agreement and Transition Plan, specific responsibilities of the Parties and, as applicable,
Deliverables, Milestones, Acceptance Testing, as well as Critical Milestones and Milestone Default
Credits. Service Provider shall, with input from WG (i) develop and present each specific
Transition Plan to WG for its approval or amendment, (ii) manage the mutually agreed upon
Transition Plan, (iii) develop and present an Acceptance Test Plan for the Transition Plan to WG
for its approval or amendment, and (iv) execute the Transition Plan and the Acceptance Test Plan,
subject to WG’s rights in Section 7.4. If and to the extent set forth in the applicable
Transition Plan Service Provider fails to complete the transition within [***] days after the date
for such completion set forth in the Transition Plan, WG shall accrue Milestone Default Credits as
set forth in the Transition Plan. WG may terminate the applicable Work Agreement, in whole or in
part, for cause, pursuant to Section 23.1.3(v) and if specified in Exhibit D to
that Work Agreement, if Service Provider fails to complete the transition as specified in the
Transition Plan.
2.7 Provision of Services.
2.7.1 Affiliates.
Services may be provided (i) by an Affiliate of Service Provider, or (ii) to an
Affiliate of WG. Each such Work Agreement shall be subject to the terms and conditions of
this Agreement pursuant to Section 2.3, with references in this Agreement to
Service Provider being read as references to the relevant Affiliate of Service Provider
and references to WG being read as references to the relevant Affiliate of WG where
appropriate. To the extent Services are provided to WG Affiliates through WG, WG as a
Party to this Agreement will (i) remain responsible for all payments for Charges to
Service Provider for such Services and (ii) in its own name pursue any claim against
Service Provider for damages suffered by such WG Affiliate as a result of such Services.
Each WG Affiliate receiving Services through WG shall sign an Affiliate Acknowledgement
form provided in Appendix 14. To the extent WG Affiliates are to receive Services
directly from Service Provider (i.e., not through WG), WG Affiliates shall enter
into Work Agreements directly with Service Provider so long as Service Provider is
reasonably satisfied with any such Affiliate’s credit rating and financial ability to meet
its payment obligations under such Work Agreement. Any such WG Affiliate shall be liable
and responsible for the performance of its obligations under such Work Agreement.
Services will be provided for the benefit of WG and its Affiliates residing in the United
States and will be delivered to United States locations. WG may elect to extend provision
of the Services to a New Affiliate in accordance with
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
4
and subject to the terms of Section 2.2.2, which Services to such Affiliate
shall be subject to the same terms and conditions (including price terms) as the Services.
Any amounts paid or owed to Service Provider or one of its Affiliates under any such Work
Agreement shall count toward any volume discount pricing arrangement or minimum revenue
commitment, if any, between the Parties.
2.7.2 Service Locations.
To the extent applicable, each specific Work Agreement shall identify the WG
Locations that shall receive each of the Services under such Work Agreement and the
approved Service Provider Service Locations that shall provide each of such Services. WG
acknowledges that Service Provider may utilize non-U.S. based operations in connection
with the performance of this Agreement. Service Provider shall be entitled, subject to
compliance with all Laws Applicable to Service Provider, Generally Applicable Laws as they
apply to Service Provider, WG Compliance Directives and all Data Protection Laws, as
provided in Section 18.4, to transfer Services and related obligations from a
Service Provider Service Location to another location as set forth in this Section
2.7.2.
(A) Transition Plan. Service Provider shall be permitted to
transfer Services as expressly set forth in the Transition Plan for each
Service.
(B) General Principles.
(1) Service Provider must notify WG at least [***] in advance of any
transfer, except as provided in (A) above.
(2) Service Provider shall, prior to such transfer, promptly provide WG
with all information reasonably requested by WG to evaluate such new Service
Provider Service Location and allow WG to conduct due diligence with respect to
such new Service Provider Service Location, including a site visit.
(3) Service Provider [***] that Service Provider will, after such transfer,
be able to fulfill all of its obligations as provided in this Agreement.
(4) If WG believes Service Provider has not [***], then Service Provider
may pursue resolution through the Dispute Resolution Process.
(5) If WG agrees that Service Provider will, after such transfer, be able
to fulfill all of its obligations as provided in this Agreement or as a result
of the Dispute Resolution Process it has been determined that Service Provider
[***],
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
5
(i) and WG agrees to such transfer, then Service Provider may so transfer
and Service Provider will be responsible for all costs associated with such
transfer, or
(ii) and WG does not agree to such transfer or agrees to such transfer
subject to a delay in the actual date of the transfer, then Service Provider may
not transfer and WG must either agree to pay all of Service Provider’s costs
associated with Service Provider continuing to provide Services from that
current Service Provider Service Location (including during the period which WG
has asked Service Provider to delay such transfer) that are in excess of the
costs Service Provider would have incurred had it transferred and provided such
Services from such new Service Provider Service Location or, if WG does not
agree to pay such costs, then Service Provider may terminate this Agreement for
its convenience (and without a payment by WG of any Termination Charges) by
giving [***] notice to WG (provided that Service Provider will provide up to
[***] of Termination Assistance Services).
(C) Leak Calls.
(1) Service Provider must notify WG at least [***] in advance of any
transfer.
(2) Service Provider must obtain WG’s prior consent to transfer any Leak
Call Services and Service Provider shall, prior to such transfer, promptly
provide WG with all information reasonably requested by WG to evaluate such new
Service Provider Service Location and allow WG to conduct due diligence with
respect to such new Service Provider Service Location, including a site visit.
(3) Service Provider shall have [***] that Service Provider will, after
such transfer, be able to fulfill all of its obligations as provided in this
Agreement and provide the Leak Call Services as well as or better than they were
provided from the original Service Provider Service Location.
(4) If WG believes Service Provider has not [***], then Service Provider
may pursue resolution through the Dispute Resolution Process.
(5) If WG agrees that Service Provider will, after such transfer, be able
to provide the Leak Call Services as well as or better than they were provided
from the original Service Provider Service Location, or as a result of the
Dispute Resolution Process it has been determined that Service Provider has
[***],
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
6
(i) and WG agrees to such transfer, then Service Provider may so transfer
and Service Provider will be responsible for all costs associated with such
transfer, or
(ii) and WG does not agree to such transfer or agrees to such transfer
subject to a delay in the actual date of the transfer, then WG must either agree
to pay all of Service Provider’s costs associated with Service Provider
continuing to provide Services in that Service Provider Service Location
(including during the period which WG has asked Service Provider to delay such
transfer) that are in excess of the costs Service Provider would have incurred
had it transferred and provided such Services from such new Service Provider
Service Location or, if WG does not agree to pay such costs, then Service
Provider may terminate the Leak Call Services for its convenience (and without a
payment by WG of any Termination Charges) by giving [***] notice to WG (provided
that Service Provider will provide up to [***] of Termination Assistance
Services).
(D) Onshore to Offshore. Notwithstanding anything to the contrary
in this Section 2.7.2, and except as provided in the Transition Plan for
each Service, Service Provider must obtain WG’s prior consent, [***] to transfer
any Services from an onshore location to an offshore location (for the purposes
of this Section 2.7.2, all locations in the U.S. and Canada shall be
considered onshore locations, and all other locations, including locations in
Mexico, shall be considered offshore locations); and,
(E) Specific Services in Work Agreement. Notwithstanding anything
to the contrary in this Section 2.7.2, any Work Agreement may require a
different standard for approval for a transfer from one Service Provider Service
Location to another Service Provider Service Location than is set forth in this
Section 2.7.2.
(F) Service Provider Responsibility. Notwithstanding WG’s approval
of the transfer of Services from a Service Provider Service Location to another
Service Provider Service Location, Service Provider shall remain liable and
responsible for the performance of all Services by it and all of its Affiliates
hereunder. Service Provider shall be [***] resulting from any transfer from one
Service Provider Service Location to another Service Provider Service Location;
provided, however, that WG shall be [***] (A) such transfer was
expressly requested by WG; or (B) WG has expressly agreed to be responsible for
[***] a Change Order or Work Agreement. [***]
(G) Dissatisfaction. If WG becomes dissatisfied with a Service
Provider Service Location due to political instability, change in Law, or
similar reason, the Parties shall discuss in good faith the movement of the
Services from such Service Provider Service Location to another Service Provider Service
Location.
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
7
2.7.3 Safety and Physical Security Procedures.
As part of the Services, Service Provider shall maintain and enforce at Service
Provider Service Locations safety and security procedures that are at least (i) equal to
accepted industry standards of leading providers of information technology services and
business process outsourcing services that are providing services similar to the Services
and the standards set forth in the applicable Work Agreement, and (ii) as rigorous as
those procedures in effect at Service Provider Service Locations as of the Effective Date.
In addition, Service Provider shall comply with WG Policies as set forth in Appendix
3. Changes to WG Policies set forth in Appendix 3 shall be agreed to and
implemented in accordance with Article 10 and the Change Request Procedures in
Appendix 12.1.
2.8 WG Corporate Policies.
Service Provider shall comply with the WG Corporate Policies as set forth in Appendix
1. Changes to such WG Corporate Policies shall be agreed to and implemented in accordance with
Article 10 and the Change Request Procedures in Appendix 12.1.
2.9 Contract Administration.
In the event Service Provider is required to administer any contracts on behalf of WG, the
terms and conditions of this Section 2.9 shall apply.
2.9.1 Service Provider Responsibilities.
2.9.1.1 Service Provider Administered Agreements.
During the Term, Service Provider shall be responsible for managing, administering, and
maintaining the Service Provider Administered Agreements.
With respect to all Service Provider Administered Agreements, and any mutually agreed
to substitutes or replacements therefor, Service Provider shall:
(i) provide WG with reasonable notice of any renewal, termination, or
cancellation dates and fees;
(ii) upon agreement by WG and Service Provider, to the extent permitted by
the Service Provider Administered Agreements, modify, terminate, or cancel any
such Service Provider Administered Agreements;
(iii) pay the modification, termination, or cancellation fees or charges
imposed upon WG in connection with any modification, termination,
8
or cancellation of any such Service Provider Administered Agreements, where
such [***] (A) caused by, or resulted from, an act by Service Provider not
approved by WG, or its Affiliates, including Service Provider’s failure to notify
WG of a renewal, termination, or cancellation date on a timely basis, or (B)
imposed by Service Provider;
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
9
(iv) be responsible for notifying WG of any performance obligations, and
maintaining any warranties (including making warranty claims for defective
products and services), under such Service Provider Administered Agreements;
(v) be the primary point of contact and be responsible for communicating
with the third party, including handling, with WG’s input and approval, problem
resolution in respect of the services provided under such Service Provider
Administered Agreements;
(vi) review operational service delivery and performance reports, escalating
problems for resolution and, where applicable, maintaining support relationships;
(vii) work with WG to administer contractual relationships between WG and
such third party with respect to such Service Provider Administered Agreements;
(viii) review reports received concerning the delivery of services by such
third party and compliance with any service levels applicable to such third party
and notify WG and such third party of each failure by such third party to perform
in accordance with the applicable service levels;
(ix) escalate third party performance failures to management of the third
party as necessary to achieve timely resolution;
(x) review the third party’s efforts to remedy a failure of performance;
(xi) communicate to WG the status of the third party’s efforts to remedy a
failure of performance; and
(xii) otherwise use commercially reasonable efforts to notify WG of issues
it becomes aware of concerning each third party’s compliance or non-compliance
with its applicable duties and obligations, including all applicable service
levels.
2.9.1.2 Performance Under Agreements.
Subject to WG’s compliance with its obligations with respect to such Service
Provider
Administered Agreements, Service Provider shall abide by the terms of, and shall not breach
or violate, any of the Service Provider Administered Agreements. Subject to Service
Provider’s compliance with its obligations with respect to such Service Provider
Administered Agreements, WG shall abide by the terms of, and shall not breach or violate,
any of such Service Provider Administered Agreements. Service Provider shall promptly
inform WG once it becomes aware of any breach of, or misuse or fraud in connection with, any
such Service Provider Administered Agreements and shall cooperate with WG to prevent or stay
any such breach, misuse, or fraud. Service
10
Provider [***] as a result of Service Provider’s failure to perform its obligations under
this Agreement with respect to such Service Provider Administered Agreements.
2.9.1.3 Limitations.
Any use by Service Provider of any services provided by each such third party pursuant
to a Service Provider Administered Agreement shall be limited to fulfilling the requirements
of this Agreement. Except as expressly set forth in this Section 2.9 or an
applicable Work Agreement, Service Provider shall not be responsible for any costs
associated with any of the contracts between such third parties and WG, nor for the
enforcement of WG’s rights or such third party’s obligations under such contracts, acting as
an agent of WG or otherwise.
2.9.2 Third Party Invoices.
(i) Service Provider Obligations. Service Provider shall: (A) receive all
Third Party Invoices; (B) review and use commercially reasonable efforts to
correct any errors in any such Third Party Invoices in a timely manner; (C)
validate that the goods and services provided with respect to such invoice were
provided or performed in accordance with such Service Provider Administered
Agreement; and (D) submit such Third Party Invoices to WG for payment within a
reasonable period of time prior to the due date, if received in sufficient time
or, if a discount for such payment is given, the date on which WG may pay such
Third Party Invoice with a discount.
(ii) WG Obligations. WG shall: (A) pay the Third Party Invoices received and
presented for payment by Service Provider in compliance with Section 2.9.2(i); and
(B) be [***] in respect of the Third Party Invoices; provided, however,
that Service Provider submitted the applicable Third Party Invoices to WG for payment
within a reasonable period of time prior to the date any such Third Party Invoice is due.
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
11
2.9.3 Assigned Agreements.
The Parties shall execute an Assignment and Assumption Agreement applicable to each
Assigned Agreement, in the form attached hereto as Appendix 9. Until WG obtains
any required Consents and the Parties have executed an Assignment and Assumption Agreement
in respect of an Assigned Agreement, such agreements shall be considered a Service
Provider Administered Agreement.
Subject to WG obtaining any required Consents, WG shall assign, and Service Provider
shall assume, all of WG’s rights and obligations under the Assigned Agreements designated
as:
(i) “Expected to be Assigned (Reviewed)” provided that full disclosure of
the terms of such Agreements have been made as of the Effective Date or
(ii) “Expected to be Assigned (Not Reviewed)”,
each in Exhibit I to Work Agreement No. 1.
In the event that an Assigned Agreement designated as “Expected to be Assigned
(Reviewed)” has not been fully disclosed as of the Effective Date, such Agreement shall be
designated as “Expected to be Assigned (Not Reviewed).”
Notwithstanding the foregoing, with respect to any Assigned Agreement designated as
“Expected to be Assigned (Not Reviewed)” in Exhibit I to Work Agreement No. 1,
Service Provider shall decide before the applicable Services Commencement Date whether it
wishes to accept the assignment of such Assigned Agreement. If Service Provider wishes to
accept assignment, and upon WG obtaining any required Consents, WG shall assign, and
Service Provider shall assume, all of WG’s rights and obligations under such Assigned
Agreements. If Service Provider wishes not to accept assignment, it shall notify WG prior
to such Services Commencement Date, such agreement shall be considered a Service Provider
Administered Agreement and the Parties will agree to an equitable adjustment to the
Charges associated with such Assigned Agreement pursuant to Paragraph 13.1(a)(i)
of Exhibit C to Work Agreement No. 1. With respect to any Service Provider
Administered Agreement that is identified in Exhibit I to Work Agreement No. 1 as
being subject to an “Agreed Termination Date,” the Party responsible for any termination
fees that would be required to terminate such Service Provider Administered Agreement is
the Party so identified on Exhibit I to Work Agreement No. 1. WG shall have
financial and administrative responsibility for Consents required to transfer or assign an
Assigned Agreement or to allow Service Provider to manage or administer a Service Provider
Administered Agreement.
12
2.9.4 No Additional Charges.
Except as expressly set forth in the applicable Work Agreement, Service Provider
shall not assess WG any additional charges or fees for administering any Service Provider
Administered Agreements (including marking up the charges or fees set forth in any Third
Party Invoices).
2.9.5 Appointment as Agent.
WG shall, to the extent necessary, in a Work Agreement, appoint Service Provider as
its agent for all matters pertaining to the Service Provider Administered Agreements.
2.9.6 Service Provider’s Payment on WG’s Behalf.
To the extent any Service requires Service Provider to make or disburse a payment to
a third party as payment agent for WG, or otherwise on WG’s behalf, the Parties shall
utilize procedures to reduce or eliminate Service Provider’s holding of WG’s funds prior
to payment. In the event Service Provider makes an incorrect payment to a third party,
Service Provider shall, subject to WG’s approval, seek to recover such incorrect payment
directly from such third party.
2.10 Services Procedure Manual.
Service Provider shall provide a Services Procedure Manual as a Deliverable that describes how
the Service Provider shall perform and deliver the Services under this Agreement and pursuant to
the applicable Statement of Work. The content and delivery requirements for the Services Procedure
Manual shall be as set forth in the Work Agreement. In the event of a conflict between the
provisions of this Agreement and the Services Procedure Manual, the provisions of this Agreement
shall control. The Services Procedure Manual shall be considered an operational document, which
Service Provider and WG may revise by mutual written agreement without the need to amend this
Agreement. The Service Provider shall establish, maintain and keep current training materials and
other documentation required by Service Provider to perform the Services.
3. Service Provider Commitments.
3.1 Capital.
During the Term, unless otherwise agreed by the Parties in such Work Agreement, all capital
investments made by Service Provider to provide the Services or as may be necessary to enhance (in
accordance with Section 3.4) and maintain the quality of the Services and Service Levels as
required by this Agreement shall be made at Service Provider’s sole expense.
3.2 Equipment and Transferred Assets.
13
3.2.1 Service Provider Equipment.
Except as otherwise expressly provided in this Agreement, Service Provider shall be
the owner or lessee of all Equipment and be solely responsible for the maintenance of the
Equipment.
3.2.2 Transferred Assets.
A Work Agreement may identify certain Equipment to be transferred by WG to Service
Provider thereunder. Such Work Agreement will specify the terms and conditions under
which such Equipment is to be sold, assigned, transferred and conveyed to Service
Provider. WG shall retain a purchase money security interest in the transferred Equipment
to secure the prompt payment of any consideration for such Equipment as set forth in the
applicable Work Agreement, and Service Provider agrees to sign and deliver any filings,
and take such other steps, as may be reasonably requested by WG to perfect such security
interest. Upon the transfer of such Equipment, Service Provider shall be responsible for
ongoing maintenance, repair and replacement of such Equipment as required. THE
TRANSFERRED EQUIPMENT IS TRANSFERRED “AS IS” AND “WHERE IS” WITH NO OTHER REPRESENTATIONS
OR WARRANTIES WHATSOEVER. SERVICE PROVIDER ACKNOWLEDGES THAT WG IS NOT ACTING AS A
MERCHANT WITH RESPECT TO SUCH TRANSFER.
3.3 Personnel and Facilities.
WG will provide work space, phone, LAN/WAN and supplies at WG Locations for the Service
Provider Personnel set forth on Exhibit L, at no additional cost to Service Provider.
Except as otherwise expressly provided in this Agreement (including the previous sentence), Service
Provider shall be responsible for providing all facilities, personnel, and other resources
necessary for Service Provider’s provision of the Services, and all costs and expenses associated
therewith.
3.4 Improvements.
Service Provider will explore opportunities on an ongoing-basis to reduce WG’s total cost of
receiving the Services (including the Charges) and to improve Service Provider’s performance of the
Services and Service Levels and shall be required, throughout the Term, to implement such measures
as mutually agreed to and implemented in accordance with [***] and the Change Request Procedures or
as otherwise set forth in a Work Agreement. Such opportunities may include economies of scale and
greater efficiencies developed by Service Provider and technical changes and other developments
affecting delivery of the Services. Each Work Agreement shall identify the Services to be provided
under such Work Agreement that are subject to continuous improvement. The program for such
continuous improvement shall be set forth in [***] or the applicable Work Agreement.
3.5 New Technology and Re-engineering.
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED.
ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
14
During the Term, Service Provider shall keep itself informed of new technology and
improvements in current technology that may facilitate or improve the Services to result in cost
savings, improvement in Service Provider’s performance of the Services and Service Levels, and
other benefits to WG. Service Provider shall advise WG of such new technology or improvements
about which it is aware and advise WG of their prospective benefits at quarterly meetings between
the Parties, and in a written report to WG at least once in each calendar year. In addition,
Service Provider shall review the operations required to support WG and shall recommend to WG
certain re-engineering procedures, processes and tools. In the event that the re-engineering
opportunity would require WG to modify its methods, practices or policies, Service Provider shall
(i) present the changes to WG, (ii) discuss with WG the requirements of implementation, and (iii)
identify the projected benefits to both WG and Service Provider. The Parties shall work in good
faith to determine the costs, benefits and proper level of commitment by both WG and Service
Provider for implementing such re-engineering projects. Either Party may request implementation of
any of the foregoing in accordance with the procedures for Changes set forth in Appendix
12.1, and Service Provider shall not implement any of the foregoing without such Changes being
mutually agreed to in accordance with Appendix 12.1.
4. Term.
4.1 Term of the Agreement.
This Master Services Agreement shall be effective as of the Execution Date and shall remain in
effect until the later of: ten (10) years after the Execution Date; or (ii) the date that there is
no Work Agreement in effect.
4.2 Term of Work Agreements; Renewals.
Each Work Agreement shall set forth its Effective Date and its Term, as well as any renewal
term(s), as applicable. Unless otherwise provided in this Agreement, expiration or termination of
such Work Agreement shall not terminate any other Work Agreement or this Master Services Agreement.
5. Pricing
5.1 Prices for Services.
The Charges for the Services are specified in each Work Agreement in accordance with the
pricing provisions set forth in each such Work Agreement. Such Charges are exclusive of Taxes that
are WG’s responsibility pursuant to this Agreement. WG is not committed to a minimum level of
business and associated charges pursuant to this Agreement except as otherwise provided in the
applicable Work Agreement.
15
5.2 Price Adjustments.
The Service Provider will review all Services and their associated prices with WG on an annual
basis, and where available improvements in performance or appropriate adjustments in Charges are
identified (including through Section 3.4 and Section 3.5), such improvements and
adjustments shall be documented and agreed to in accordance with the procedures for Changes set
forth in Appendix 12.1; provided, however, that the requirement in this Section 5.2
that the Parties agree to improvements shall not apply to Services specifically identified in
applicable Work Agreements as being subject to continuous improvement obligations pursuant to
[***].
5.3 Incidental Expenses.
Any expenses that Service Provider expects to incur that are incidental to Service Provider’s
performance of the Services, such as long distance telephone charges, office supplies, document
reproduction, shipping and overnight mail charges, network connectivity charges, overnight mail
charges and costs associated with personnel training in accordance with WG policies, shall be
included in the prices set forth in the applicable Work Agreement. Unless otherwise expressly set
forth in such Work Agreement, such incidental expenses shall be the sole responsibility of Service
Provider and shall in no circumstances be reimbursed by WG.
5.4 Reimbursable Expenses.
WG shall reimburse Service Provider for pass-through expenses (including travel expenses,
living, hotel and transportation expenses) approved in advance by WG and in accordance with WG’s
then-current expense reimbursement policy. WG shall only reimburse expenses incurred by Service
Provider, if Service Provider submits such expenses to WG within [***] of the end of the month in
which such expenses were incurred, and so long as Service Provider submits a reasonable estimate of
such expenses [***] in which such expenses were incurred.
5.5 Service Provider’s Billing Rates.
Service Provider’s rates for certain types of work to be performed for WG are as set forth in
each applicable Work Agreement, which rates shall not increase during the Term, unless otherwise
set forth in the applicable Work Agreement.
5.6 Tax Obligations.
The Parties’ respective obligations with respect to Taxes arising under, or in connection
with, this Agreement are set forth in Appendix 5.
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED.
ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
16
6. Invoicing and Payment.
6.1 Monthly Payments.
Service Provider shall invoice WG in U.S. Dollars on a monthly basis for all Services that
Service Provider believes are to be performed by Service Provider and all related forthcoming
charges that Service Provider believes are to be incurred by WG during that calendar month,
including any transition or transformation charges, and adjusted for any relevant Milestone Default
Credits or Service Level Credits. Service Provider shall provide the invoice within the first
three (3) days of the month. Such invoice shall separately identify any applicable Taxes for which
WG is responsible. Service Provider shall send all invoices, in the format set forth in the
applicable Work Agreement, in both electronic and hard copy form and with accounting codes
prepopulated, to the attention of the person therein designated, to the address set forth in the
applicable Work Agreement or such other address as WG may provide to Service Provider from time to
time. All invoices will be issued by Service Provider from an address in the United States to WG
at an address in the United States. Simultaneously with each invoice Service Provider shall also
provide the supporting information, documentation and time sheets identified in the applicable Work
Agreement for WG to verify the accuracy of such invoice. Service Provider will reconcile the
actual Charges to the invoiced Charges as soon as reasonably possible and provide an associated
accounting and reconciliation for any necessary adjustments to prior months’ ▇▇▇▇▇▇▇▇. In the
event that Service Provider does not provide WG with a reasonable estimate of Charges within [***],
or does not provide an invoice (and the supporting information, documentation and time sheets
identified in the applicable Work Agreement) within [***] of the end of the month in which such
Services were provided (or the applicable reimbursable expense was incurred), WG will not be
obligated to pay any after-issued invoice with respect to such Services (or applicable reimbursable
expense); provided, however, that (i) WG will remain responsible for any WG Tax
obligations with respect to such Services that are later assessed by a governmental tax authority
with respect to the Services and the delay in levying of the assessment is not due to Service
Provider’s failure to fulfill its obligations under this Agreement, and (ii) any such failure by
Service Provider to provide an invoice within [***] shall not relieve Service Provider of any
obligation to credit any excess charges previously invoiced by Service Provider.
6.2 Payment.
WG shall pay via wire transfer in U.S. Dollars all undisputed amounts in such invoices on or
before the last Business Day in the month when the invoice was submitted. WG shall remit all such
payments to the address specified by Service Provider. Any payment by WG shall be without
prejudice of WG’s right to contest the accuracy of any invoice or charges. Any portion of an
invoice not paid on or before the last Business Day of the month when the invoice was submitted,
and not disputed pursuant to Section 6.7, shall accrue interest at a rate of the lesser of
one (1) percent per month and the highest rate permitted by Law per month, such interest beginning
to accrue as of the first day after such portion was late and calculated on a simple interest basis
(provided, however, that WG will not be required to pay interest to the
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED.
ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
17
extent WG’s delay in payment to Service Provider is due to Service Provider’s failure with
respect to its obligations (if any) with respect to any accounts payable aspects of the Services).
6.3 Intentionally Omitted.
6.4 Adjustments to Invoiced Amounts.
With respect to any amount that is agreed between the Parties as an amount that (i) should be
reimbursed to a Party by the other Party, (ii) is owed to a Party by the other Party with respect
to damages incurred, or (iii) is otherwise owed or payable to a Party by the other Party pursuant
to this Agreement, WG may deduct the entire amount owed against the Charges otherwise payable or
expenses owed to Service Provider under this Agreement and Service Provider may add the entire
amount owed to the Charges otherwise payable or expenses owed to Service Provider under this
Agreement.
6.5 Records and Audit.
Service Provider shall comply with the obligations set forth in Appendix 10 with
respect to audits.
6.6 Service Level Credits and Milestone Default Credits.
Subject to WG’s review and approval, Service Provider shall calculate any Service Level
Credits and Milestone Default Credits in accordance with Appendix 8 and Exhibit D.
In addition, with each such Service Level Credit and Milestone Default Credit, Service Provider
shall provide WG with supporting documentation in reasonably sufficient detail to permit WG to
review and confirm the accuracy of such Service Level Credit and Milestone Default Credit.
6.7 Disputed Charges.
WG shall pay all undisputed charges when they become due in accordance with this Agreement.
If WG, in good faith, disputes any Charges regarding the Services, it shall promptly notify Service
Provider and the Parties shall address such Dispute in accordance with this Section 6.7.
With respect to those portions not in Dispute, Service Provider shall submit a new invoice for such
portions and WG shall pay such portions within five (5) Business Days of receipt of such new
invoice but in no event earlier than the date payment was due in accordance with the original
invoice. With respect to those portions in Dispute, WG may withhold payment of such portions
provided that WG may not withhold in the aggregate more than an amount equal to one (1) month’s
Charges without placing the amount into escrow. In such event, WG will promptly notify Service
Provider of the disputed amount, with an explanation of the reasons therefor. Following
notification of a disputed invoice charge amount, the Parties will use their reasonable endeavors
to resolve such Dispute within fifteen (15) days. If the Parties cannot resolve such Dispute
within fifteen (15) days, then the matter will be escalated to the representatives of the Parties
specified in the Dispute Resolution Process. Upon resolution, the amount, if any, payable will be
paid to Service Provider with interest calculated at the lesser of
18
(i) the prime rate as published in the Wall Street Journal as of the date on which the Parties
agree on the amount of the overcharge and (ii) the highest rate allowed by Law. If the aggregate
amounts withheld exceed one (1) month of Charges, WG shall place all such amounts in excess of one
(1) month of Charges in an escrow account in an FDIC-insured bank chosen by WG, pending resolution
of the Dispute by mutual agreement or pursuant to the Dispute Resolution Process. Amounts held in
escrow (including interest received, if any) shall be released upon joint instruction of the
Parties following any settlement or other mutual agreement, or as determined by final adjudication
of the Dispute (less, in either case, reasonable, applicable escrow costs, which shall be equally
divided), provided that the Party that is successful in any final adjudication of the Dispute shall
be entitled to the interest, if any. In no event will the disputed amounts to be withheld pursuant
to this Section 6.7 exceed in the aggregate at any one time the Maximum Withholding Amount;
provided, however, that disputed amounts withheld due to an invoice containing an unmistakable
manifest error (e.g., a request for payment of $1,000,000,000 when the amount due was
$100,000) will not be included when calculating the Maximum Withholding Amount. WG’s failure to
deposit disputed Charges into escrow as provided in this Section 6.7, or WG’s withholding
of Charges in excess of the Maximum Withholding Amount, shall be grounds for Service Provider to
terminate this Agreement, including all Work Agreements, in accordance with Section 23.2.
7. Acceptance.
7.1 Acceptance Testing.
Service Provider shall perform Acceptance Testing of the Submitted Items as set forth in each
applicable Work Agreement in accordance with the applicable Acceptance Criteria for such Submitted
Item. The Acceptance Criteria for each Submitted Item shall be set forth in the appropriate
Agreement document (e.g., Work Agreement, Project Work Order, Change Order). If no
Acceptance Criteria are set forth, then each Submitted Item shall not be subject to acceptance,
provided that in no event does the lack of specific acceptance criteria relieve Service Provider
from its obligations to otherwise provide such Submitted Item in accordance with the provisions of
this Agreement. Following Service Provider’s successful completion of such Acceptance Testing,
Service Provider shall provide prompt written notice thereof and WG may, at its option and in its
discretion, perform any additional Acceptance Testing itself. Service Provider shall seek WG’s
Acceptance of each Submitted Item in accordance with the timelines for such Submitted Item set
forth in the applicable Agreement document. The initial submission of a Submitted Item for WG’s
approval shall be made at least [***] Business Days (or such other time period agreed by the
parties (the “Review Period”) prior to the applicable due date. When establishing a Milestone or
projected completion date for a Submitted Item, Service Provider shall take the Review Period into
consideration for timing.
7.2 Failure of Acceptance Testing for Submitted Items.
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
19
7.2.1
If the relevant WG Work Product, Deliverables or any portion thereof does not conform
to the Acceptance Criteria or fails Acceptance Testing (whether performed by Service
Provider or WG), WG shall give Service Provider a Rejection Notice specifying any
deficiencies in sufficient detail and Service Provider shall correct all deficiencies
[***] after receipt of the Rejection Notice or such other time period as may be set forth
in the applicable Work Agreement. Within thirty (30) days after such corrections have been
made, Service Provider and/or WG shall retest the applicable WG Work Product or
Deliverables as set forth in such Work Agreement. If the WG Work Product or Deliverables
fail Acceptance Testing upon such retest, WG may, in its sole discretion: (x) grant
Service Provider additional time to correct the outstanding deficiencies; or (y) without
prejudice to any of WG’s other rights and remedies under this Agreement or at law or in
equity, make a claim for damages.
7.2.2
If Service Provider has successfully performed Acceptance Testing or met the
Acceptance Criteria under the applicable Work Agreement after such Acceptance Testing by
Service Provider and/or WG, or WG otherwise decides, in its sole discretion, to accept a
Submitted Item subject to such Acceptance Testing, WG shall notify Service Provider of its
Acceptance of such Submitted Item. Payment by WG of any Charges to Service Provider for
use of such Submitted Item by WG prior to Acceptance shall not constitute WG’s Acceptance
of such WG Work Product or Deliverables. WG will not forgo any remedies it may otherwise
have under this Agreement in the event of a later discovery of material defects,
deficiencies or nonconformities in the accepted Submitted Items that were not reasonably
discoverable by WG prior to such Acceptance. Further, in accepting such Submitted Item, WG
will not forgo any remedies it may otherwise have under this Agreement with respect to
such Submitted Item to the extent in the Work Agreement, Project Work Order or Change
Order it is specifically called out as being dependent on any other Submitted Item that
fails Acceptance Testing relating thereto,
7.3 Failure to Meet Deliverables.
Service Provider shall pay to WG Milestone Default Credits with respect to any failure by
Service Provider to meet the Acceptance Criteria for any Deliverable or WG Work Product as set
forth in the applicable Work Agreement. Service Provider’s obligation to pay Milestone Default
Credits [***]. Milestone Default Credits shall be offset against any damages awarded in the event
that WG successfully pursues a claim against Service Provider, [***].
7.4 Acceptance of Transition Submittals.
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COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
20
For Transition Submittals, when Service Provider determines that the applicable Production
Readiness Criteria identified in the applicable Transition Plan for a particular Transition
Critical Milestone in the Transition Plan have been met or recommends Transition should otherwise
proceed, Service Provider shall notify WG. Thereafter, WG shall promptly determine whether the
applicable Production Readiness Criteria identified in the applicable Transition Plan for a
particular Transition Critical Milestone in the Transition Plan have been met or Transition should
otherwise proceed. If WG determines that the Production Readiness Criteria have been met or WG
agrees Transition should otherwise proceed, Service Provider shall notify the Executive Governance
Committee. Thereafter, the Executive Governance Committee shall promptly determine whether such
Production Readiness Criteria for such Transition Critical Milestone have been met or Transition
should otherwise proceed. In the event that the Executive Governance Committee determines that
such Production Readiness Criteria for such Transition Critical Milestone have been met or
Transition should otherwise proceed and issues an Acceptance (the “Completion Criteria”), the
Completion Criteria shall be considered satisfied and the Transition Critical Milestone shall be
considered accepted. In the event that WG or the Executive Governance Committee makes a negative
determination, Service Provider shall promptly be provided written notice of the Production
Readiness Criteria that were not met and Service Provider shall seek to meet the Production
Readiness Criteria for a particular Transition Critical Milestone and resubmit it for review by WG
and the Executive Governance Committee consistent with this Section. This process shall continue
until the Executive Governance Committee determines that the Completion Criteria have been met or
until WG exercises its termination rights pursuant to Section 23.1.3(v) and Exhibit
D.
8. Performance Measurement for Support Services.
8.1 Performance of Services.
Service Provider shall develop and exhibit an understanding of the business and technical
objectives of WG. Service Provider shall provide the Services and the Termination Assistance
Services in accordance with the Service Levels and Performance Requirements set forth in the
applicable Work Agreement. In the event a Work Agreement does not specify a Service Level or
Performance Requirement for particular Services or Termination Assistance Services, or portion
thereof, Service Provider shall provide such Services or Termination Assistance Services at a
commercially reasonable level in accordance with accepted industry standards of leading providers
of information technology services and business process outsourcing services that are providing
services similar to the Services or Termination Assistance
21
Services and the standards set forth in the applicable Work Agreement. WG may require Service
Provider to correct or re-perform any defective or non-conforming Services or Termination
Assistance Services, and except due to the fault of WG or its Affiliates or WG Third Party
Suppliers, WG shall not be obligated to pay for such correction or re-performance beyond the
amounts that WG would otherwise have had to pay had such Services or Termination Assistance
Services been performed correctly in the first instance.
8.2 Modification of Service Levels.
WG and Service Provider may modify the Service Levels as set forth in Appendix 8 or
the applicable Work Agreement. In addition, Service Levels shall also be adjusted to reflect the
results of benchmarking pursuant to Appendix 7.
8.3 Measurement and Monitoring Tools for Service Levels.
Service Provider shall implement, at its expense, the Measurement and Monitoring Tools. Such
Measurement and Monitoring Tools shall permit reporting on at least a monthly basis to WG at a
level of detail sufficient to verify compliance with the Service Levels and Performance
Requirements and shall be subject to audit by WG in accordance with Appendix 10.
8.4 Failure to Meet Service Levels.
Service Provider shall pay to WG Service Level Credits in accordance with Appendix 8.
Service Provider’s obligation to pay Service Level Credits to WG shall not limit WG’s right to seek
additional remedies for any failure by Service Provider to meet the applicable Service Level.
Service Level Credits shall not constitute a penalty or liquidated damages but any Service Level
Credits paid by Service Provider to WG shall be offset against any damages awarded in the event
that WG successfully pursues a claim arising out of such service failure. To the extent that a
maximum credit amount (as set forth in the applicable Work Agreement) has been reached, Service
Provider’s obligation to provide the maximum amount of Service Level Credits shall have no effect
on WG’s right to terminate the applicable Work Agreement or this Agreement or any other rights or
remedies WG may have under this Agreement at law or in equity, including any right to damages upon
termination or otherwise.
8.5 Failure to Meet Critical Milestones.
Service Provider shall pay to WG Milestone Default Credits with respect to any failure by
Service Provider to fully satisfy any Critical Milestone in accordance with the applicable Work
Agreement. Service Provider’s obligation to pay a Milestone Default Credit to WG as a result of
failure to meet a Critical Milestone shall not limit WG’s right to seek additional remedies for any
failure by Service Provider to meet such Critical Milestone. Milestone Default Credits shall not
constitute a penalty or liquidated damages but any Milestone Default Credits paid by Service
Provider to WG shall be offset against any damages awarded in the event that WG successfully
pursues any claim arising out of such failure to meet a Critical Milestone.
22
8.6 Root Cause Analysis.
Promptly after receipt of a notice from WG of Service Provider’s failure to meet a [***] (as
provided in Appendix 8), Service Provider shall (i) commence diligent efforts to perform a
root cause analysis, (ii) within fifteen (15) days provide a preliminary root-cause analysis for
such failure, (iii) within thirty (30) days provide a final root-cause analysis for such failure,
(iv) correct such failure within a reasonable time period taking into account the circumstances,
(v) provide WG with a report detailing the cause of, and procedure for correcting, such failure,
and (vi) provide WG with reasonable evidence that such failure will not be repeated.
8.7 Commitment of Commercially Reasonable Efforts.
To the extent that Service Provider fails to satisfy a Critical Milestone, Service Level or
Performance Requirement or is otherwise in a position such that the provision of the Services
within the time frame specified in the applicable Work Agreement is jeopardized, Service Provider
shall use commercially reasonable efforts to complete the development or attain the relevant
Critical Milestone or to provide the Services as necessary for such timeframe to be met. The use
of commercially reasonable efforts by Service Provider as required in this Section 8.7
shall not in any way limit Service Provider’s liability (including the payment of Milestone Default
Credits and Service Level Credits) for failure to meet the Critical Milestones, Service Levels and
Performance Requirements and other Milestones set forth in the applicable Work Agreement, and to
the extent the Services are being performed on a fixed price basis, WG shall [***].
9. Benchmarking.
WG shall have the right to benchmark the Services in accordance with the procedures set forth
in Appendix 7.
10. Change Management Process.
10.1 Changes.
The Parties may revise, amend, alter, or otherwise change the nature and scope of the Services
provided under this Agreement from time to time by mutual written agreement, including changes
relating to: (i) the addition of Services; (ii) the termination of certain Services; (iii) the
modification of Services; (iv) changes to WG Policies, or (v) any other changes that alter the
scope of a Work Agreement, or the nature of the Services (collectively, “Changes”). All such
Changes shall be made in accordance with the procedures set forth in Appendix 12.1 and the
applicable Work Agreement, and shall except as otherwise provided in Appendix 12.1 only
become effective upon the execution by both Parties of a Change Order.
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COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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10.2 Mandatory Changes.
Notwithstanding Section 10.1 and Appendix 12.1, if WG determines that the
implementation of a Change is required for WG to comply with a change in Laws or to prevent or
mitigate a material adverse effect on WG’s business or operations, then WG may, upon written
notice, require Service Provider to commence with implementing such Change without agreement on a
Change Order, unless implementing such Change would require Service Provider to violate applicable
Law; provided, however, that (i) if such Change would require Service Provider to
incur additional direct costs (with a reasonable margin), WG will reimburse Service Provider for
such costs on a time and materials basis using the Project Rates set forth in the rate cards set
forth in the applicable Work Agreement for the applicable Service Tower until the Parties agree on
the Change Order and (ii) if Service Provider performs such Change on a time and materials basis to
allow WG to comply with a change in Laws, such Change will be considered a WG Compliance Directive.
11. Project and Relationship Management.
11.1 Contract Governance.
The Parties shall implement the contract governance procedures set forth in Appendix
12.
11.2 Failure to Act.
Service Provider and its subcontractors will be excused from failures to perform their
obligations under this Agreement or to meet or exceed the Service Levels, and any resulting
damages, to the extent that (i) WG, its Affiliates or its and their agents (other than Service
Provider and its agents and other persons or entities working on Service Provider’s behalf) fail to
perform the retained services identified in a Work Agreement or other provisions of this Agreement,
or WG, its Affiliates or its and their agents (other than Service Provider and its agents and other
persons or entities working on Service Provider’s behalf) fail to provide resources required by
this Agreement or fulfill an obligation under this Agreement and (ii) such failure directly causes
Service Provider’s failure to perform; provided, however, that Service Provider
must (x) give WG prompt notice of WG’s, its Affiliates’ or its and their agents’ failure to perform
such retained services, provide such resources or fulfill such obligation resulting in such
performance failure, (y) use its reasonable efforts to continue to perform despite WG’s, its
Affiliates’ or its and their agents’ failure to perform such retained services, provide such
resources or fulfill such obligation under this Agreement and (z) use its reasonable efforts to
mitigate the adverse consequences of WG’s, its Affiliates’ or its and their agents’ failure to
perform such retained services, provide such resources or fulfill such obligation under this
Agreement. Any such failure of WG, its Affiliates or its and their agents shall not [***] to the
extent that Service Provider is seeking to be excused pursuant to this Section 11.2 and
shall only
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
24
excuse Service Provider and its subcontractors from failing to perform their obligations under
this Agreement or to meet or exceed the Service Levels.
11.3 Other Providers.
Service Provider acknowledges that provision of the Services may involve interaction with
other providers of services and products to WG, including possibly Third Party Providers. Service
Provider shall interact with the Third Party Providers in a manner that facilitates provision of
the Services and the Third Party Providers’ services or products in an orderly manner; provided,
however, that Service Provider’s obligation to cooperate is subject to any Third Party Provider’s
agreement to the confidentiality restrictions that this Agreement imposes on WG (but only to the
extent that Service Provider’s Confidential Information is involved), and such cooperation will
respect Service Provider’s and WG’s commitments to contractual restrictions and obligations imposed
by WG Third Party Supplier Agreements and Service Provider Third Party Supplier Agreements.
Service Provider shall promptly notify WG of any matter involving a Third Party Provider that
causes or threatens proper provision of the Services or the provision of any products or services
by a Third Party Provider.
12. Service Provider Personnel and Subcontractors.
12.1 Key Personnel.
12.1.1 Generally.
Each Work Agreement shall list the Key Personnel and their respective
responsibilities to facilitate continuity of Services during the Term. In assigning such
Key Personnel, Service Provider shall represent to WG that such Key Personnel are
qualified to provide and are experienced in providing the Services to which they are
assigned. Unless a Work Agreement specifies otherwise, Service Provider shall not
reassign or remove any such Key Personnel for [***] from the date that such person is
designated as Key Personnel, without the prior express consent of WG, or unless such
person (i) voluntarily resigns from Service Provider, (ii) is dismissed by Service
Provider for cause, (iii) will be subject to material undue hardship (e.g.,
marital issues, illness, etc.), and as a result will terminate his/her employment with
Service Provider if such person is not permitted to be reassigned to another account, or
(iv) dies or is unable to work due to his or her disability. Service Provider shall, if
possible, consult with WG prior to reassigning or removing any Key Personnel pursuant to
subsections (ii) and (iii). Service Provider shall be responsible for the cost of
training and transitioning a replacement Key Personnel.
12.1.2 Time and Effort.
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COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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Unless a Work Agreement specifies otherwise, all Key Personnel shall devote their
full working time and resources to performance of Services for WG under such Work
Agreement.
12.1.3 Replacements.
Before replacing any of the Key Personnel, Service Provider shall, at its sole
expense: (i) notify WG of the proposed replacement, selected by Service Provider in
Service Provider’s sole discretion; (ii) introduce the proposed replacement to appropriate
WG representatives; (iii) provide WG with the proposed replacement’s resume and any other
information about such individual’s qualifications as may be reasonably and lawfully
requested by WG; and (iv) inform WG of the training and knowledge transfer plan to be used
by Service Provider. If, within [***] of WG’s receipt of such information, WG objects to
the proposed assignment on lawful grounds, Service Provider shall review and confer with
WG regarding such objections, and shall attempt to resolve such concerns in a manner
agreeable to both Parties. If the Parties have not been able to resolve WG’s concerns
within [***] after WG’s objection, Service Provider shall not assign the proposed
replacement to that position and shall propose to WG the assignment of another individual
of suitable ability and qualifications, selected by Service Provider in Service Provider’s
sole discretion, which assignment shall be subject to the review and approval procedure
set forth in this Section 12.1.3; provided, however, that if any
of the Key Personnel terminates their employment with Service Provider or will terminate
his/her employment with Service Provider in accordance with Section 12.1.1,
Service Provider will have the ability to replace such person on a temporary basis and
will work cooperatively and expeditiously with WG to identify a permanent replacement for
such person.
12.1.4 Replacement Transition.
In connection with any change of Key Personnel, unless WG otherwise agrees in a
particular instance in writing, Service Provider shall, if it can, provide that the person
to be replaced and the approved replacement have overlapping service (i.e., dual coverage)
of at least fifteen (15) days. Service Provider shall execute the training and knowledge
transfer plan referenced in Section 12.1.3 at Service Provider’s sole cost.
12.2 Personnel.
12.2.1 Qualified Personnel.
Service Provider and its subcontractors shall provide Personnel with suitable
training, education, skill and other qualifications to perform the Services under each
specific Work Agreement.
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COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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12.2.2 Withdrawal/Replacement.
If WG desires to withdraw or replace any Personnel providing the Services, WG shall
consult with Service Provider. If, after such consultation, WG requests the withdrawal or
replacement of any Personnel, Service Provider and its subcontractors shall withdraw or
replace such Personnel as soon as reasonably practical, and in connection with such action
[***].
12.2.3 Notification and Replacement.
Service Provider shall use commercially reasonable efforts to facilitate the
continued employment by Service Provider and its Affiliates of its and their employees
then performing Services pursuant to a Work Agreement. Service Provider shall notify WG,
on a confidential basis, of the termination, and the reasons therefor, for Service
Provider’s or its subcontractor’s termination for cause of (i) any Personnel in
customer-facing positions, handling WG’s money or financial matters, or that has access to
WG Personal Data; (ii) any subcontractors set forth in Exhibit O, or for whom WG’s
prior written consent is required in accordance with Section 12.5.1; (iii) any
Personnel where termination is related to a breach of WG Policies or violation of
applicable Law. If either (x) the employment of any Personnel performing Services under a
Work Agreement is terminated by Service Provider or such Personnel for any reason
whatsoever, or (y) WG requires the withdrawal or replacement of any Personnel pursuant to
Section 12.2.2, Service Provider and such subcontractor shall replace such
terminated or withdrawn Personnel with new Personnel appropriately trained for the
position that person is assuming. WG shall [***].
12.2.4 Compliance.
When Personnel (including those of each subcontractor) are on WG’s premises, they
shall comply with all applicable WG rules, regulations and policies applicable to other
contractors at WG, to the extent such policies have been provided to Service Provider,
including such matters as on-site working hours, and holidays. WG will comply with WG
Polices as set forth in Appendix 1 and Appendix 3. Service Provider
acknowledges that it has been provided with copy of all of the policies referenced on
Appendix 1 and Appendix 3. Service Provider shall provide each of its
Personnel performing Services with copies of such rules, regulations and policies provided
by WG and shall monitor such Personnel’s compliance with such rules, regulations and
policies. WG may, in its sole discretion, approve all Personnel requiring access to any
WG facility or site. Personnel shall only perform applicable Services and shall not work
on other accounts when present on WG premises.
12.2.5 Screening and Background Checks.
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COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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Service Provider shall, at its expense, maintain a program to provide reasonable
assurance that its Personnel performing the Services are trustworthy and reliable.
i) All Personnel: Subject to applicable Law and availability in the relevant
jurisdiction, the following are required for all Personnel:
| Searches | Information Required for Search | |
Local Criminal History Research
[***] Years of Residence
|
Names to be searched; date of birth; SSN; and all information regarding jurisdictions to be searched | |
Social Locator
|
Full name and SSN (or equivalent in countries outside of the United States) | |
Education Verification
|
Correct name of school; address (at least city and state); year of graduation; last year attended; campus attended; name of applicant; all former names; date of birth; SSN; degree earned; name on degree | |
Driving Record (if driving a WG
vehicle)
|
Drivers license number; names as appears on driver’s license; state of license; SSN; date of birth | |
Credit Report (if handling WG funds)
|
SSN; current address; date of birth |
ii) Leak Call Services. In addition to the requirements of Section
12.2.5(i), Service Provider shall, at its expense, maintain a program to provide
reasonable assurance that its Personnel performing Leak Call Services and Personnel
managing the Leak Call Services are trustworthy and reliable. Service Provider may not
use Personnel to perform such functions if Service Provider obtains information indicating
such Personnel has tested positive for controlled substances, tested at or above .04
breath alcohol concentration, or refused to test. Such program, administered by an
independently audited lab, shall consist of:
| 1. | All collection, transportation, testing procedures, test evaluation measures, quality control measures applicable to laboratories, medical review officers, record keeping, and reporting of drug test results will conform to the U. S. Department of Health and Human Services’ “Mandatory Guidelines for Federal Workplace Programs”, 49 CFR Part 40. | ||
| 2. | A policy and procedure for conducting the controlled substance and alcohol tests as approved by WG that describes how the tests will be conducted, when they will be conducted, and how records will be audited and retained, including confirmation of all positive test results by a) a second methodology utilizing |
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COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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| Gas Chromatography/Mass Spectrometry (GS/MS) and b) a medical review officer. | |||
| 3. | The performance of four types of controlled substance tests: | ||
| (i) Prequalification controlled substance and alcohol testing is a requirement for all applicants intended for hire or transfer into performing or managing safety sensitive employees. Prospective employees must submit to a pre-qualification (NIDA 10 panel) test for the use of controlled substances, including alcohol, not greater than [***] before the applicant is to begin performing Leak Call Services. Prior to collection of a urine sample, the applicant shall be notified that the sample will be tested for the presence of controlled substances. Applicants who provide a sample that tests positive will be prohibited from performing Leak Call Services. | |||
| (ii) Reasonable cause controlled substance and alcohol (NIDA 10 panel) – testing protocol to be implemented when conduct witnessed by a supervisor or company official is indicative of the use of a controlled substance. All supervisors of Personnel performing Leak Call Services shall be trained in the identification of actions, appearance, or conduct that are indicative of the use of a controlled substance. Where such behavior has been observed, a supervisor shall transport such Personnel to the collection site within two (2) hours of the witnessing of indicative behavior. Refusal to submit to the test should result in removal from performing the Leak Call Services. While awaiting the test results and confirmation from the medical review officer, such Personnel should be removed from performing Leak Call Services. | |||
| (iii) Post incidence controlled substance and alcohol NIDA 10 panel tests shall be conducted at the direction and upon notification from WG. The decision to test is based upon the conclusion that the Personnel’s actions cannot be ruled out as a contributing factor to an incident. Upon such notification, a supervisor will escort such Personnel to the closest testing facility as soon as possible, but no later than two (2) hours of the notification. A refusal by such Personnel to submit to the test should be treated as a positive test. Such Personnel should be removed from performing Leak Call Services for a refusal or until the results are received from the medical review officer. Any positive result should result in removal from performing Leak Call Services. | |||
| (iv) Random controlled substance (10 Panel NIDA) testing will be conducted quarterly and administered at a fifty percent (50%) annualized rate so that during any twelve (12) month period the number of tests conducted will be equal to half of the total pool of covered Personnel. Personnel providing Leak |
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COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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| Call Services will be subject to random testing at any time with no advance notice. The random selection process will ensure each Personnel |
30
| the same fair and equal chance of being selected. Personnel randomly selected will be notified by his/her supervisor of the selection and instructed to immediately go to the designated collection site. Failure to submit to a random test should be treated as a positive test and Personnel should be removed from performing Leak Call Services. Positive results confirmed by the medical review officer should result in such Personnel being removed from performing Leak Call Services. | |||
| 4. | Record Retention |
| a. | Service Provider will retain the following records for a period of at least five (5) years: |
| (1) | Records of Personnel tested, by type of test, and the results of each test; | ||
| (2) | Documentation of Personnel that refuse to take required controlled substance and alcohol tests; | ||
| (3) | Confirmed positive drug test results that show that Personnel failed a drug test; this record will also include: (a) the prohibited drug used; and (b). disposition of the Personnel (i.e., termination, reassignment); |
| b. | Service Provider will retain records confirming supervisory and Personnel training described in 3(ii) above for at least three (3) years. |
(iii) Other: Additional background check and screening requirements may be set forth
in a Work Agreement.
In the event that any part of this program is not permitted by applicable Law without
consent, Service Provider shall endeavor to obtain the appropriate consent.
Notwithstanding the foregoing, and including in the event of any transfer of Leak Calls to
a new Service Provider Service Location, Service Provider shall: (x) assign sufficient
Personnel at any given time to handle Leak Calls, and (y) prevent any Personnel that has
not undergone the foregoing screening program specified above from handling Leak Calls.
12.2.6 Visas and Immigration Requirements.
Service Provider shall procure, at its expense, all visas and other immigration
requirements necessary to provide the Services as set forth in an applicable Work
Agreement.
12.3 No Third Party Beneficiaries.
Nothing in this Article 12 is intended to provide to any employee of either Party or
the Personnel any benefit or right, or entitle any such employee or the Personnel to any claim,
cause of action, remedy, or right of any kind, the intent of the Parties being that nothing in this
Article 12 shall be deemed to create any obligations of either Party to any employee of
either Party or
31
the Personnel or to create any right to any employee of either Party or the Personnel. No
employee of either Party or the Personnel shall have any rights to enforce this Article 12,
either for his or her own benefit or otherwise. Personnel supplied hereunder are not WG’s
employees or agents and Service Provider shall continue to be fully responsible for their acts.
Service Provider, or its subcontractors (as applicable) shall be solely responsible for the payment
of compensation of the Personnel and Service Provider and its subcontractors (as applicable) shall
inform Personnel that they are not entitled to any of WG’s employee benefits. Service Provider or
its subcontractors (as applicable), and not WG, shall be solely responsible for payment of worker’s
compensation, disability benefits and benefits similar thereto and unemployment insurance or for
withholding and paying employment taxes for the Personnel.
12.4 Transfer of WG Personnel.
If any employees will be transferred from WG to Service Provider, the applicable Work
Agreement will include the human resource provisions.
12.5 Service Provider’s Use of Subcontractors and Third Party Suppliers.
12.5.1 Subcontractors.
12.5.1.1 Service Provider Obligations.
Service Provider shall not subcontract any portion of the Services or all or any
portion of its obligations under this Agreement without WG’s prior written consent, except
that Service Provider may, without WG’s prior written consent, (i) enter into subcontracts
for third party services or products with any of the subcontractors listed in Exhibit
O as pre-approved as of the Effective Date, (ii) cause its Affiliates to provide any of
the Services, (iii) enter into subcontracts with (A) natural persons (1) who qualify as
“independent contractors” or “temp employees” of Service Provider who provide temporary
services to Service Provider under independent contractor relationships of a type commonly
referred to in the United States as “1099” relationships or (2) who provide services to
Service Provider on a leased employee or so-called “staffed- or temp-employee basis”
pursuant to contracts between Service Provider and a staff augmentation or staff
supplementation company, or (B) subcontractors that provide ancillary indirect support
services, or (iv) in the ordinary course of business, enter into a subcontract with an
entity to provide third party services for which the total estimated or anticipated value of
such subcontract is less than [***] in any calendar year.
12.5.1.2 Limitations.
Notwithstanding Section 12.5.1.1, WG’s consent shall be required for Service
Provider to subcontract with any person or entity (other than Service Provider’s
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
32
Affiliates) contracted with exclusively to provide services to WG or any of its
Affiliates [***], to provide any of the Leak Call Services [***], or to provide Services
that are expressly identified in a Work Agreement as requiring WG’s consent for
subcontracting [***]. WG’s consent with respect to any subcontracting shall not relieve
Service Provider of its responsibility for the performance of any of its obligations under
this Agreement or constitute WG’s consent to further subcontracting. In assigning
subcontractors to provide the Services for which WG’s prior written consent is required,
Service Provider shall first obtain WG’s written approval and shall further represent to WG
that such subcontractors are qualified to provide, and are experienced in providing, the
Services to which they are assigned. To the extent WG’s consent for such subcontractors is
required under this Agreement, WG approves the subcontractors set forth in the applicable
Work Agreement, but only with respect to the specific portions of the Services to be
subcontracted to such subcontractor as set forth in the Work Agreement.
12.5.1.3 Reassignment or Removal by Service Provider.
Service Provider shall not, without the consent of WG, reassign or remove any
subcontractor that has been contracted with exclusively to provide Services to WG. If
Service Provider proposes to enter into a Subcontract for which WG’s prior written consent
is required, Service Provider shall clearly set forth in writing to WG: (i) the specific
portions of the Services that Service Provider proposes to subcontract; (ii) the scope of
the proposed subcontract; (iii) the identity, background, and qualifications of the proposed
subcontractor; and (iv) the type of contract that exists or shall exist between Service
Provider and the subcontractor.
12.5.1.4 Reassignment or Removal at WG’s Request.
WG shall have the right: (i) to approve or disapprove the use of proposed
subcontractors for which WG’s prior written consent is required; and (ii) to revoke its
prior approval of a subcontractor for which WG’s prior written consent was required;
provided, however, that WG agrees to relieve Service Provider from its
obligations to meet applicable Service Levels for a reasonable period of time to the extent
impairment is caused by such discontinuance and to reimburse Service Provider for
termination charges (if any) Service Provider is required to pay such subcontractor to
terminate its agreement with Service Provider and other reasonable fees associated with such
transition, so long as Service Provider uses commercially reasonable efforts to mitigate
such impairment and to avoid such termination charges. Notwithstanding the foregoing, WG
shall have the right to terminate any subcontractor that is an entity, without payment of
any related charges, if WG has the right (whether or not such right is exercised) to
terminate this Agreement, or the applicable Work Agreement, as a result of the acts or
omissions of such subcontractor.
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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12.5.1.5 Subcontracts.
Each Subcontract shall be subject to all Data Protection Laws, and to the extent
necessary as determined by WG, the subcontractor entering into such Subcontract may be
required to provide adequate assurance that the WG Personal Data will be processed in a
manner consistent with the Data Protection Laws.
12.5.2 Third Party Services.
Notwithstanding Section 12.5.1.1, Service Provider may, without WG’s consent,
subcontract or obtain services that meet all of the following criteria: (i) the services
are not designated as critical functions for the Services in the applicable Work
Agreement; (ii) the services do not involve interaction with WG’s customers; and (iii) the
services do not involve access to or the use of WG Personal Data. Also, for purposes of
this Agreement, a third party that provides Equipment or Software and associated repair or
maintenance services for such Equipment or Software would not be considered a
subcontractor for purposes of this Agreement solely with respect to the foregoing.
12.5.3 Service Provider’s Responsibility for Subcontractors.
With respect to any obligations of Service Provider under this Agreement performed by
subcontractors, Service Provider shall remain responsible for such obligations in addition
to subcontractor compliance with the terms and conditions of this Agreement to the same
extent Service Provider would be responsible for its own compliance with the terms and
conditions of this Agreement. Service Provider shall not disclose to any subcontractor,
or any third party supplier under a Service Provider Third Party Supplier Agreement, any
of WG’s Confidential Information unless and until such subcontractor, vendor or supplier
has a need to know such Confidential Information and has agreed in writing to protect the
confidentiality of such information in a manner that is equivalent to that required of
Service Provider by Article 15. Service Provider shall be responsible as WG’s
sole point of contact regarding the Services.
13. Audit and Inspection Rights.
WG may conduct audits of Service Provider as set forth in Appendix 10.
14. Business Continuity and Disaster Recovery.
14.1 Business Continuity Plan.
Upon the Services Commencement Date for a Service to be performed by Service Provider under
each Work Agreement, Service Provider shall apply Service Provider’s Business Continuity Plan (as
approved by WG and as modified pursuant to this Agreement) to such Service in accordance with
Appendix 13 and the applicable Work Agreement.
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14.2 Implementation of Business
Continuity Plan.
Upon the occurrence of a Disaster and as part of the Charges, Service Provider shall implement
the Business Continuity Plan in accordance with Appendix 13. The occurrence of a Disaster
(including any Force Majeure Event) will not relieve Service Provider of its obligation to
implement the Business Continuity Plan and to provide disaster recovery Services. If the Services
are not restored within the period specified in the Business Continuity Plan, and to the extent
such failure to restore Services is attributable to Service Provider’s failure to comply with the
Business Continuity Plan, WG may [***].
14.3 Testing of Business Continuity Plan.
Each Work Agreement shall set forth the frequency with which Service Provider must, at its own
expense, test the Business Continuity Plan, but in no event shall such tests be conducted less
frequently than annually. WG shall have the right, at any time and from time to time, to review
the Business Continuity Plan as it relates to the Services and request Service Provider to modify
or enhance the Business Continuity Plan as reasonably necessary to address any WG concerns or
policy changes and such modifications or enhancements will be agreed to and implemented using the
Change Request Procedures in Appendix 12.1.
15. Confidentiality.
15.1 Duty of Confidentiality.
Each Party acknowledges that it may, in the course of performing its responsibilities under
this Agreement, be exposed to, or acquire, Confidential Information of the other Party or its
Affiliates or their customers or third parties to whom the other Party or its Affiliates owe a duty
of confidentiality. Recipient agrees to hold the Confidential Information of Discloser in
confidence using the same or greater degree of care it uses with its own most sensitive information
(but in no event less than a reasonable degree of care) and not to copy, reproduce, sell, assign,
license, market, transfer or otherwise dispose of, give or disclose such information to third
parties or to use such information for any purposes whatsoever other than the performance of this
Agreement or as expressly set forth in this Agreement. Recipient will limit access to Confidential
Information of Discloser to only those of its employees, agents and contractors having a
need-to-know in connection with this Agreement or provision of the Services. Recipient shall
advise all of its employees and subcontractors who may be exposed to the Confidential Information
of Discloser of their obligations to keep such information confidential in accordance with this
Article 15. Recipient shall, upon expiration or termination of this Agreement or
applicable Work Agreement or otherwise upon demand, either return to Discloser or destroy and
certify in writing to Discloser the destruction of any and all documents, papers and materials and
notes thereon in Recipient’s possession, including copies or reproductions thereof, to the extent
they contain Confidential Information of Discloser except for any
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
35
Confidential Information which is otherwise required to be retained pursuant to this
Agreement, which Confidential Information will continue to be subject to the terms of this
Agreement.
15.2 Exclusions to Confidential Information.
Confidential Information shall not include information that Recipient can show: (i) was or
has later become available to the public through no breach of this Agreement; (ii) was obtained
from a third party who rightfully received the information without the obligation of
confidentiality; (iii) was already in the Recipient’s possession prior to direct or indirect
disclosure pursuant to this Agreement, the Request for Information, the Request for Proposal, or
the Supplemental Request; or (iv) was independently developed by Recipient without reference to the
Confidential Information of Discloser.
15.3 Permitted Disclosures.
If the Recipient is requested to disclose all or any part of any Confidential Information of
the Discloser under a discovery request, a subpoena, or inquiry issued by a court of competent
jurisdiction or by a judicial, administrative, regulatory or governmental agency or legislative
body or committee, or the Recipient determines that disclosure is required under applicable Law,
the Recipient shall, to the extent practicable and subject to applicable Laws, give prompt written
notice of such request or such determination to the Discloser and shall give the Discloser the
opportunity to seek an appropriate confidentiality agreement, protective order or modification of
any disclosure or otherwise intervene, prevent, delay or otherwise affect the response to such
request or such determination and Recipient shall cooperate in such efforts. Discloser shall
reimburse Recipient for reasonable legal fees and expenses incurred in Recipient’s effort to comply
with this provision. The Parties agree that this Section 15.3 would be applicable to the
extent either Party intended to make this Agreement or any portion thereof publicly available.
15.4 Confidentiality Agreements.
WG and its Affiliates receiving Services shall inform its and their employees with access to
Service Provider’s Confidential Information of their respective confidentiality obligations under
Section 15.1. Service Provider shall require its subcontractors and employees to execute
confidentiality agreements that contain confidentiality obligations that are no less rigorous with
respect to WG’s Confidential Information than the confidentiality obligations set forth in this
Agreement.
15.5 Data Protection.
In the event Service Provider shall have access to any WG Personal Data, the terms and
conditions set forth in Appendix 2 and Appendix 6 shall apply.
15.6 Strictest Treatment.
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Service Provider shall comply with the strictest applicable requirements under this Agreement
for any information that meets the definition of more than one of the following terms:
Confidential Information of WG and WG Personal Data.
15.7 Remedy.
It is understood and agreed that in the event of a breach of this Article 15, damages
will not be an adequate remedy and the non-breaching Party shall be entitled to injunctive relief
to restrain any such breach, threatened or actual, notwithstanding Article 22.
15.8 Attorney Client Privilege/Work Product.
As a result of its position in providing and performing the Services, Service Provider may
have unique knowledge of certain operations and information of WG that neither WG nor any of its
employees will have in full. In addition, although Service Provider and WG have not established an
employee-employer relationship, in providing and performing the Services as an independent
contractor, Service Provider may interact with the employees, executive management, board of
directors, accountants and legal counsel to WG in a manner and with respect to matters that,
functionally, may appear to be the same as or similar to functions performed or previously
performed by employees and agents of WG. Service Provider also acknowledges that certain
documents, data and databases to which Service Provider has access or are created by Service
Provider for WG and all associated communications relating thereto may be subject to the legal
professional client privilege and that such information may have been or may be prepared in
anticipation of litigation and that Service Provider is performing the Services in respect of such
information as an agent of WG. To the extent that any of the materials or information provided to
and from Service Provider as part of the Services for, and related communications with, legal
counsel of WG (both in-house counsel and outside counsel) may be subject to WG attorney-client
privilege and/or work product privilege, Service Provider shall reasonably cooperate, at WG’s
expense and direction, to take steps designed to prevent waiver of any privilege with respect
thereto. The foregoing shall not, however, be construed to affect the liability or obligations of
the Parties pursuant to or in connection with this Agreement or the Services; provided, however,
that the Recipient may disclose certain Confidential Information in accordance with Section
15.3.
15.9 No Right or License.
Nothing in this Article 15 shall be construed as obligating either Party to disclose
its Confidential Information to the other Party, or as granting to, or conferring on, the other
Party, expressly or impliedly, any rights or license to the Confidential Information.
16. Data and Information Security.
16.1 Safeguarding of WG Data.
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Service Provider shall establish and maintain safeguards against the destruction, loss, misuse
or alteration of WG Data in the possession of Service Provider that are no less rigorous than those
set forth in Article 15, Article 16, or Appendix 2. WG shall have the
right to establish separate backup security for WG Data and to keep backup data and data files.
Service Provider shall notify WG immediately in the event of (i) a breach of any Data Protection
Law, (ii) a breach in the security of any WG Data, or (iii) a breach of any requirement under this
Agreement with respect to WG Data and shall also follow the procedures set forth in Appendix
2 and Appendix 6 with respect thereto.
16.2 Provision of WG Data.
Notwithstanding any other provision of this Agreement, Service Provider shall make all WG Data
(complete and unaltered) available at any time to WG and its authorized agents in the form in which
Service Provider is using or storing such WG Data at no additional charge.
16.3 Ownership and Use of WG Data.
As between the Parties, WG Data shall be and remain the property of WG. Service Provider
shall use the WG Data solely to perform Service Provider’s obligations under this Agreement.
Except as expressly permitted in this Agreement, Service Provider shall not sell, assign, lease,
disseminate, or otherwise dispose of the WG Data or any part thereof to any other person, and
Service Provider shall not commercially exploit any part of the WG Data. Service Provider shall
not possess or assert any property interest in, or any lien or other right against or to, any WG
Data.
16.4 Data Retention.
16.4.1 During Term.
During the Term and subject to Appendix 2, Service Provider shall retain all
WG Data associated with a Work Agreement for as long as WG is required by Law, or by WG’s
Policies set forth in Appendix 1, or as expressly set forth in such Work
Agreement. WG shall inform Service Provider of any such requirements of Law (subject to
Section 18.4) and WG Policies, which shall be incorporated into the applicable
Work Agreement. Nothing in this Article 16 shall relieve Service Provider of (i)
other document retention requirements expressly provided in this Agreement, or (ii) its
obligations in Section 18.4.
16.4.2 Post-Term.
Upon termination or expiration of a Work Agreement, or upon request by WG at any time
with respect to particular WG Data not required by Service Provider to perform Service
Provider’s obligations under this Agreement, or at the end of any specified retention
period set forth in such Work Agreement, Service Provider shall return to WG the WG Data
associated with such Work Agreement in the form and manner reasonably requested by WG
(which shall be at no charge to WG if such form
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and manner was that used by Service Provider, but conversion to a different form and
manner may result in a reasonable charge to WG) including all copies of documents, papers
or other material that may contain or be derived from WG Confidential Information and
delete from its servers any electronic copies of all such information (excluding for
purposes of this Section 16.4.2, copies of this Agreement) that are in Service
Provider’s possession or control, together, if requested by WG, with a certificate signed
by Service Provider in form and substance reasonably satisfactory to WG, stating that all
WG Data has been returned or destroyed. Service Provider shall remove WG Data from its
applications and databases and shall use mutually approved data destruction methods to
remove WG Data from its back-up systems.
17. Intellectual Property.
17.1 WG Intellectual Property.
17.1.1 Trademarks and Service Marks.
To the extent that the Services permit or require a Party to use the name, logo or
domain name of the other Party, a Party shall, unless otherwise agreed in a particular
instance, adhere to all brand identity standards provided in writing to the other Party.
Any such use of the name, logo or domain name by that Party does not constitute a
trademark license by the Party to the other Party to use the name, logo or domain name in
association with any other trademark, any product or service that a other Party
manufactures, distributes, sells, or supports, or any service that the other Party
performs or renders. The Parties acknowledge that the company logo and all goodwill
associated therewith of the other Party are, and shall remain, the sole property of the
Party that owns such company logos and no rights are conferred upon the other Party with
respect thereto. Any and all trademarks appearing in any materials and systems connected
with the Services shall contain appropriate trademark ownership/attribution notices that
clearly identify the applicable owner as the owner of such trademarks.
17.1.2 WG Intellectual Property.
WG shall be, and shall remain, the sole and exclusive owner of all WG Intellectual
Property. Subject to the other terms and conditions of this Agreement, WG hereby grants
to Service Provider and its subcontractors providing the Services, during the Term and
during the period Termination Assistance Services are being provided, a non-exclusive,
worldwide, royalty-free, non-transferable license to use, copy, maintain, modify, enhance
and create derivative works of the WG Intellectual Property solely for the purpose of
providing the Services to WG pursuant to this Agreement. Neither Service Provider nor its
subcontractors shall be permitted to use WG Intellectual Property for the benefit of any
entities other than WG and its Affiliates. Except as requested or approved by WG, or as
otherwise provided in this Agreement, Service
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Provider and its subcontractors shall cease all use of WG Intellectual Property at
the end of the Term and after Termination Assistance Services are discontinued.
17.1.3 WG Work Product.
All WG Work Product shall be considered “works made for hire” and shall be owned by
WG and WG shall be, pursuant to the Copyright Act, the author of such work. If any WG
Work Product may not be considered a “work made for hire” under applicable Law, Service
Provider hereby agrees to irrevocably assign to WG, upon payment of all applicable
separately identifiable Charges as provided in the applicable Work Agreement, all of
Service Provider’s right, title, and interest in and to the WG Work Product, including all
Intellectual Property Rights therein (excluding rights in Pre-Existing Service Provider
Intellectual Property and Independently Acquired Intellectual Property), and waives any
moral rights therein. Service Provider acknowledges that WG and the successors and
assigns of WG shall have the right to obtain and hold in their own name any Intellectual
Property Rights and other proprietary rights in and to all WG Work Product. Service
Provider shall execute any documents and take any other actions reasonably requested by WG
to effectuate the purposes of this Section 17.1.3. To the extent that the WG Work
Product includes or incorporates any Pre-Existing Service Provider Intellectual Property
or Independently Acquired Intellectual Property, Service Provider hereby grants to WG and
its Affiliates, during and after the Term, a paid-up, royalty-free, perpetual,
irrevocable, worldwide, non-exclusive, and transferable right to use, copy, maintain,
modify, enhance and create derivative works of such Service Provider Intellectual Property
(i) solely as embedded in such WG Work Product, and (ii) solely in connection with WG’s
and its Affiliates’ respective businesses for the receipt or delivery of services that are
substantially similar to the Services; provided, however, that WG and its
Affiliates (or their successors) may sub-license such rights to unrelated third parties
solely in connection with WG’s own business and solely for the purpose of providing
services substantially similar to the Services to WG, its Affiliates or their successors.
17.1.4 Service Provider’s Subcontractors.
Each of Service Provider’s subcontractors that creates any WG Work Product shall be
required by Service Provider to execute written agreements (i) assigning to WG (or to
Service Provider who shall then in turn assign to WG), without further consideration, all
of its right, title, and interest in and to such WG Work Product, including all
Intellectual Property Rights therein, and (ii) agreeing to execute any documents and take
any other actions reasonably requested by WG (or Service Provider, on WG’s behalf) to
effectuate the purposes of this Section 17.1.4.
17.2 Service Provider Intellectual Property.
17.2.1 Service Provider Intellectual Property.
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Service Provider and its Affiliates shall be, and shall remain, the sole and
exclusive owners of all Service Provider Intellectual Property. Subject to the other
terms and conditions of this Agreement, Service Provider, on behalf of itself and its
Affiliates, hereby grants to WG, for itself and its Affiliates, a non-exclusive,
worldwide, royalty free (during the Term), non-transferable license, with the right to
sublicense to third parties solely for the purpose of providing services to WG and its
Affiliates (provided that a Service Provider Competitor may not be a sublicensee thereof
unless contractually obligated to keep such Service Provider Intellectual Property
confidential), to use and maintain the Service Provider Intellectual Property that is
incorporated in, or provided as part of, the Services. Service Provider may use the
Service Provider Intellectual Property for any purpose, including for the purpose of
providing services to a third party.
17.2.2 Deliverables.
During the Term of the applicable Work Agreement, Service Provider shall create
Deliverables as set forth in an applicable Work Agreement or Change Order. All
Deliverables shall be owned by Service Provider and Service Provider shall be, pursuant to
the Copyright Act, the author of such work, provided that Service Provider shall remove
WG’s Confidential Information contained in such Deliverables, if any, prior to making such
Deliverables available to any third party. Service Provider hereby grants to WG and its
Affiliates during and after the Term a perpetual, paid-up, royalty-free, worldwide,
non-exclusive, sub-licensable but otherwise non-transferable (except to a successor) right
to use, copy, maintain, modify, enhance and create derivative works of such Deliverables
(including any Service Provider Intellectual Property incorporated therein) solely in
connection with WG’s own business for the receipt or delivery of services substantially
similar to the Services to WG or its Affiliates; provided, however, that
(i) WG may sublicense such rights to unrelated third parties solely in connection with
WG’s own business and solely for the purpose of providing services to WG, its Affiliates
or their successors, and (ii) if such Deliverable is a discrete deliverable subject to
separately identifiable Charges, the foregoing license shall become irrevocable once such
Charges have been paid to Service Provider.
17.3 Disclosure and Delivery of All Deliverables and Work Product.
Upon completion of the Services or the termination of a project and subject to the transfer
provisions of Section 17.1.3, Service Provider shall use all commercially reasonable
efforts to disclose fully and to deliver promptly to WG all of the Deliverables and WG Work
Product, including related object and source code, as well as any and all copies, summaries or
extracts of such WG Work Product; provided that, subject to the restrictions of this Agreement,
Service Provider shall have the right to retain one copy of any and all reports and other work
product associated therewith for its own files for reference only.
17.4 No Other Licenses.
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This Agreement does not grant or otherwise give either Party ownership in, or other
proprietary rights or license to use, the other Party’s Intellectual Property Rights except as
expressly provided for herein or in an applicable Work Agreement.
17.5 Service Provider and Third Party Intellectual Property.
To the extent Service Provider desires to include any Service Provider Intellectual Property
or other third party Intellectual Property in any WG Work Product or Deliverables to be provided or
licensed to WG that would not be covered by the licenses granted to WG under Sections
17.1.3 and Section 17.2 above, Service Provider shall (i) notify WG prior to such
inclusion, (ii) identify all such Service Provider Intellectual Property and third party
Intellectual Property in the applicable Work Agreement, and (iii) not proceed with such inclusion
without first obtaining WG’s consent. During the Term and except as set forth in an applicable
Work Agreement, Service Provider shall have financial and administrative responsibility for
obtaining any Consents and any additional licenses that may be necessary for Service Provider to
use such third party Intellectual Property or Service Provider Software during the Term in the
provision of Services and to grant the licenses set forth in this Article 17, and WG shall
have financial and administrative responsibility for obtaining any Consents and any additional
licenses that may be necessary for Service Provider to use the WG Software and WG Systems in the
provision of Services. The Party financially and administratively responsible for obtaining the
Consent shall obtain such Consent. Such responsibility will include the payment of any required
transfer, upgrade, access, license or similar fees or charges related thereto. The other Party
will provide reasonable assistance to the responsible Party in obtaining such Consent. The Parties
will cooperate to obtain such Consents in a cost effective and efficient manner.
If any Consent cannot be obtained, the Parties will (i) make any appropriate adjustments to
their respective obligations under this Agreement, all to the extent necessary due to a failure to
obtain such Consents, and (ii) seek to establish mutually acceptable alternative arrangements so
that the Parties may perform their respective obligations under this Agreement by alternative
means. After the Term, Service Provider shall use commercially reasonable efforts to obtain the
right for WG and its Affiliates, as applicable, to use such third party Intellectual Property, or
to have a third party use such third party Intellectual Property on WG’s and its Affiliates’
behalf.
17.6 Inventions.
Each Party, and their respective Affiliates, shall own any Inventions created, conceived or
developed by such Party or Affiliate in connection with this Agreement. WG hereby grants to
Service Provider a non-exclusive, worldwide, paid-up, perpetual, irrevocable and transferable
license under all Inventions, and any patent applications and patents issued thereon, created,
conceived or developed by WG or its employees, whether alone or jointly with others, in connection
with the Services, WG Work Product or Deliverables, with the right to sublicense, to make, have
made, use, copy, maintain, modify, enhance and create derivative works of such Inventions. Service
Provider hereby grants to WG and its Affiliates a nonexclusive, worldwide, paid-up, perpetual,
irrevocable and transferable license under all Inventions, and any patent applications and patents
issued thereon, created, conceived or developed by Service Provider or its employees, whether alone
or jointly with others, in connection with the provision of Services,
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WG Work Product or Deliverables, with the right to sublicense, to make, have made, use, copy,
maintain, modify, enhance and create derivative works of such Inventions. The Parties shall jointly
own any Inventions that is jointly developed by the Parties, without any duty of accounting, and
without payment of license, royalties, or any other fees; provided, however, that a
Party shall remove the other Party’s Confidential Information contained in such Intellectual
Property, if any, prior to making such Inventions available to any third party. Subject to the
preceding sentence, neither Party shall be restricted from marketing or commercializing such
jointly owned Inventions. The Parties shall jointly have all right, title, and interest in and to
any patents arising from jointly owned Inventions. Each Party agrees to execute any documents and
take other actions as may be necessary or reasonably requested by the other Party (at such other
Party’s expense) to perfect or register such other Party’s joint ownership of any jointly owned
Inventions.
17.7 Residual Rights.
So long as a Party complies with its obligations under this Agreement (including with respect
to Intellectual Property Rights and license rights and its confidentiality and data protection
obligations), nothing in this Agreement is intended to preclude a Party from acquiring, marketing,
developing, distributing, licensing, or using for itself or others, services, products or
technology that are the same as or similar to those provided pursuant to this Agreement.
Furthermore, subject to the rights that the other Party may have with respect to patents or
copyrights, a Party will continue to be free to use the general knowledge, skills and experience
and any Residual Rights that are acquired or used in the course of providing or receiving the
Services.
18. Representations, Warranties and Covenants.
18.1 Service Provider Representations, Warranties and Covenants.
18.1.1 Authorization.
Service Provider represents and warrants: (i) that this Agreement has been validly
executed and delivered by Service Provider and that the provisions set forth in this
Agreement constitute legal, valid, and binding obligations of Service Provider enforceable
against Service Provider in accordance with their terms, subject to bankruptcy,
insolvency, reorganization and other laws affecting creditors’ rights generally, and with
regard to equitable remedies, to the discretion of the court before which proceedings to
obtain such remedies may be pending; (ii) that Service Provider has all requisite power
and authority to enter into this Agreement (including the power and authority to enter
into any agreements required under applicable Data Protection Laws and any other
agreements the forms of which are attached hereto on behalf of its Affiliates) and to
carry out the transactions contemplated by this Agreement, and that the execution,
delivery and performance of this Agreement and the consummation of the transactions
contemplated by this Agreement have been duly authorized by all
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requisite action on the part of Service Provider; (iii) that Service Provider’s
execution and delivery of this Agreement and Service Provider’s performance or compliance
with the terms of this Agreement shall not conflict with, result in a breach of,
constitute a default under, or, other than the Consents, require the consent of any third
party under any license, sublicense, lease, contract, agreement, or instrument to which
Service Provider is bound or by which its properties are subject; and (iv) that Service
Provider has not authorized any third party to act as a broker or finder or in any similar
capacity in connection with the transactions contemplated by this Agreement.
18.1.2 Professional Services.
Service Provider represents and warrants that Service Provider will perform the
Services and the Termination Assistance Services in a professional and workmanlike manner
in accordance with accepted industry standards of leading providers of information
technology and business process outsourcing services providing services similar to the
Services.
18.1.3 Employees.
Service Provider represents and warrants that the Services and Termination Assistance
Services will be performed by employees of Service Provider within the scope of their
employment or by third party subcontractors retained in accordance with the terms of this
Agreement, all of whom are under written obligations to assign to Service Provider all
right, title and interest, including all Intellectual Property Rights, in the Services,
Termination Assistance Services, WG Work Product and Deliverables to Service Provider.
Service Provider also represents and warrants that any employee, agent, or contractor
assigned by Service Provider to provide Services or Termination Assistance Services under
this Agreement shall be deemed to be an employee, agent, or contractor of Service
Provider.
18.1.4 Non-Infringement.
Service Provider represents and warrants that: (i) any hardware, software, documents
or other materials provided under this Agreement or any Work Agreement, including any
Pre-Existing Service Provider Intellectual Property, Independently Acquired Intellectual
Property, Deliverables and WG Work Product do not and shall not infringe or otherwise
conflict with the Intellectual Property Rights of a third party; and (ii) it shall perform
the Services and Termination Assistance Services under this Agreement in a manner that
does not and shall not infringe, or constitute an infringement or misappropriation of, any
Intellectual Property Rights of any third party; provided, however, that
WG’s sole and exclusive remedy for a breach of this warranty shall be WG’s rights under
Section 19.1.
18.1.5 No Unlawful or Unauthorized Actions.
Service Provider represents and warrants that it has not violated and will not
violate any applicable Laws or any WG Policies regarding the offering of unlawful
44
inducements, and, except as otherwise expressly provided in this Agreement, it has
not taken and will not take any actions that (i) create, or purport to create, any
obligation on behalf of WG, or (ii) grant, or purport to grant, any rights or immunities
to any third party under WG Intellectual Property.
18.1.6 Viruses/Disabling Code.
Service Provider represents and warrants that any Software provided or used (other
than WG Software owned by or licensed to WG) by Service Provider as part of the Services
(including Service Provider Software and Service Provider Third Party Software) or
developed for WG (i) does not and shall not contain any malicious code designed to
intentionally disable, slowdown, impair or otherwise shut down WG’s System, including any
viruses, disabling code, time bombs or Trojan horses, except to the extent attributable
to any action by WG; and (ii) shall be interoperable with other Software used by Service
Provider that may deliver records to WG Software, receive records from such WG Software or
interact with such WG Software, including to back-up and archive data, excluding operation
failures and other problems that arise as a consequence of defects in the WG Data, WG
Software or other Software not provided by or through the Service Provider, its Affiliates
or their subcontractors.
18.1.7 New Software.
When Service Provider develops Software pursuant to a Work Agreement or a Change
Order, Service Provider and WG shall jointly prepare specifications for such Software, and
Service Provider shall warrant for the time period (if any) specified in the applicable
Work Agreement or Change Order that such Software shall perform in accordance with such
specifications in all material respects. Service Provider shall use and comply with
generally accepted coding practices and any standards or requirements expressly set forth
in an applicable Work Agreement.
18.1.8 Continuing Warranties.
Service Provider covenants that each of the representations and warranties set forth
in this Section 18.1 and each other express representation and warranty of Service
Provider in this Agreement, shall remain true and correct during the Term. To the extent
that any such representation or warranty becomes untrue in any material respect during the
Term, Service Provider shall notify WG of the facts and circumstances surrounding such
situation.
18.2 WG Representations, Warranties and Covenants.
18.2.1 Authorization.
WG represents and warrants: (i) that this Agreement has been validly executed and
delivered by WG and that the provisions set forth in this Agreement
45
constitute legal, valid, and binding obligations of WG enforceable against WG in
accordance with their terms, subject to bankruptcy, insolvency, reorganization and other
laws affecting creditors’ rights generally, and with regard to equitable remedies, to the
discretion of the court before which proceedings to obtain such remedies may be pending;
(ii) that WG has all requisite power and authority to enter into this Agreement (including
the power and authority to enter into any agreements required under applicable Data
Protection Laws and any other agreements the forms of which are attached hereto) and to
carry out the transactions contemplated by this Agreement, and that the execution,
delivery and performance of this Agreement and the consummation of the transactions
contemplated by this Agreement have been duly authorized by all requisite action on the
part of WG; (iii) that WG’s execution and delivery of this Agreement and WG’s performance
or compliance with the terms of this Agreement shall not conflict with, result in a breach
of, constitute a default under, or, other than the Consents, require the consent of any
third party under any license, sublicense, lease, contract, agreement, or instrument to
which WG is bound or by which its properties are subject; and (iv) that WG has not
authorized any third party to act as a broker or finder or in any similar capacity in
connection with the transactions contemplated by this Agreement, provided that Service
Provider acknowledges that WG has engaged EquaTerra, Inc. in an advisory capacity with
respect to this Agreement and the transactions contemplated herein.
18.2.2 Non-Infringement.
WG represents and warrants that: (i) any hardware, software, documents or other
materials provided under this Agreement, including any WG Intellectual Property and WG
Software that is owned by WG do not and shall not infringe or otherwise conflict with the
Intellectual Property Rights of a third party; provided, however, that
Service Provider’s sole and exclusive remedy for a breach of the warranty in this
Section 18.2.2 shall be Service Provider’s rights under Section 19.2.
18.2.3 No Unauthorized Actions.
WG represents and warrants that it has not taken and will not take any actions that,
except as expressly provided by this Agreement (i) create, or purport to create any
obligation on behalf of Service Provider, or (ii) grant, or purport to grant, any rights
or immunities to any third party under Service Provider Intellectual Property.
18.2.4 Viruses/Disabling Code.
WG represents and warrants that any WG Software owned by it, as provided in its
unmodified state by WG to Service Provider, does not contain any malicious code designed
to intentionally disable, slowdown, impair or otherwise shut down Service Provider’s
systems, including any viruses, disabling code, time bombs or Trojan horses, except to the
extent attributable to any action by Service Provider.
18.2.5 Continuing Warranties.
46
WG covenants that each of the representations and warranties set forth in this
Section 18.2 and each other express representation and warranty of WG in this
Agreement, shall remain true and correct during the Term. To the extent that any such
representation or warranty becomes untrue in any material respect during the Term, WG
shall notify Service Provider of the facts and circumstances surrounding such situation.
18.3 Disclaimer.
EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT, THE PARTIES MAKE NO REPRESENTATIONS
OR WARRANTIES, EXPRESS OR IMPLIED, REGARDING ANY MATTER, INCLUDING FITNESS FOR A PARTICULAR
PURPOSE, MERCHANTABILITY, INFORMATIONAL CONTENT, SYSTEMS INTEGRATION, NON-INFRINGEMENT,
INTERFERENCE WITH ENJOYMENT, OR RESULTS TO BE DERIVED FROM THE USE OF ANY SERVICE, SOFTWARE,
HARDWARE, DELIVERABLES, OR OTHER MATERIALS PROVIDED UNDER THIS AGREEMENT. SERVICE PROVIDER DOES
NOT REPRESENT OR WARRANT THAT THE OPERATION OF ANY SOFTWARE WILL BE UNINTERRUPTED OR ERROR FREE.
18.4 Compliance with Laws.
18.4.1 WG Compliance.
WG shall comply with all Laws Applicable to WG and all Generally Applicable Laws as
they apply to WG and shall be responsible for any fines, penalties, sanctions and interest
imposed on Service Provider or WG by a Governmental Authority to the extent directly
resulting from (i) the failure of WG to comply with Laws Applicable to WG or Generally
Applicable Laws as they apply to WG, except to the extent caused by Service Provider’s
failure to fulfill its obligations under this Agreement, (ii) the compliance by Service
Provider with a WG Compliance Directive, or (ii) the failure of WG to issue a WG
Compliance Directive. WG shall promptly notify Service Provider of any non-compliance by
WG with Laws Applicable to WG or Generally Applicable Laws as they apply to WG that
impacts Service Provider upon learning thereof. WG shall work expeditiously to remedy
such non-compliance and the Parties will otherwise cooperate in a commercially reasonable
manner with each other to allow for the Services to be provided to the extent legally
permissible. Service Provider shall be responsible for any fines, penalties, sanctions and
interest imposed on WG by a Governmental Authority resulting from WG’s noncompliance with
Laws Applicable to WG or Generally Applicable Laws as they apply to WG that is a direct
result of Service Provider’s failure to perform the Services. To the extent of any change
in Laws Applicable to WG or Generally Applicable Laws as they apply to WG, or a change to
the Service as a result of a WG Compliance Directive, the cost of such change shall be
borne by WG. With respect to this Section 18.4.1, a Work Agreement may specify
specific obligations with respect to compliance with Laws. The Parties
47
agree that in the case of a conflict between the terms and conditions of this
Section 18.4.1 and a specific obligations on WG with respect to compliance with
Laws contained in a Statement of Work with respect to whether an obligation is an
obligation to comply with Laws Applicable to WG, the specific obligation in a Work
Agreement with respect to compliance shall be deemed to be an obligation to comply with
Laws Applicable to WG.
18.4.2 Service Provider Compliance.
18.4.2.1 Laws Applicable to Service Provider.
Service Provider shall perform the Services in compliance with all Laws Applicable to
Service Provider, all Generally Applicable Laws as they apply to Service Provider, and all
WG Compliance Directives, and shall be responsible for any fines, penalties, sanctions and
interest imposed on Service Provider or WG by a Governmental Authority to the extent
directly resulting from the failure of Service Provider to comply with (i) Laws Applicable
to Service Provider or (ii) Generally Applicable Laws as they apply to Service Provider or a
WG Compliance Directive, except to the extent caused by WG’s failure to fulfill its
obligations under this Agreement. Service Provider shall promptly notify WG in writing of
non-compliance by Service Provider with Laws Applicable to Service Provider or Generally
Applicable Laws as they apply to Service Provider or WG Compliance Directives that impacts
WG upon learning thereof. Service Provider shall work expeditiously to remedy such
non-compliance and the Parties will otherwise cooperate in a commercially reasonable manner
with each other to allow for the Services to be provided to the extent legally permissible.
To the extent a change in Laws Applicable to Service Provider or Generally Applicable Laws
as they apply to Service Provider is such that had WG not entered into this Agreement it
would have had to modify its internal services as a consequence of such change in Laws
Applicable to Service Provider or Generally Applicable Laws as they apply to Service
Provider, the costs of such change in Laws Applicable to Service Provider or Generally
Applicable Laws as they apply to Service Provider shall be borne by WG to the extent of such
modifications; provided, however, to the extent that the costs of such
change are allocable to multiple customers of Service Provider, such costs shall be
equitably allocated to WG and such customers. To the extent of any other change in Laws
Applicable to Service Provider or Generally Applicable Laws as they apply to Service
Provider, the cost of such change in Laws Applicable to Service Provider or Generally
Applicable Laws as they apply to Service Provider shall be borne by Service Provider. In
the event of any changes in Laws, Service Provider shall implement any necessary
modifications to the Services prior to the deadline imposed by the Governmental Authority
having jurisdiction for such change, in accordance with Section 10.2. With respect
to this Section 18.4.2.1, a Work Agreement may specify specific obligations with
respect to compliance with Laws. The Parties agree that in the case of a conflict between
the terms and conditions of this Section 18.4.2.1 and specific obligations of
Service Provider with respect to compliance with Laws contained in a Work Agreement with
48
respect to whether an obligation is an obligation to comply with Laws Applicable to
Service Provider, the specific obligation in a Work Agreement with respect to compliance
shall be deemed to be an obligation to comply with Laws Applicable to Service Provider.
18.4.2.2 Compliance Directives.
WG shall instruct Service Provider as to the manner in which Service Provider should
perform the Services or implement changes to the Services so as to comply with any Laws
Applicable to WG or Generally Applicable Laws as they apply to WG (a “WG Compliance
Directive”). WG may, at any time after the Effective Date, identify the specific obligations
of Service Provider that so enable WG to comply with any Laws Applicable to WG or Generally
Applicable Laws as they apply to WG, including compliance with applicable WG Policies and
meeting specific Service ▇▇▇▇▇▇,
▇▇
and such identification will serve as the WG Compliance Directive relating thereto. Service
Provider shall be authorized to act and rely on, and shall implement, each WG Compliance
Directive in the performance and delivery of the Services. Subject to Section 10.2,
any changes to the Services necessitated by a new WG Compliance Directive shall be as agreed
by the Parties in accordance with the Change Request Procedures. To the extent that the
costs of such Changes are allocable to multiple customers of Service Provider, such costs
shall be equitably allocated to WG and such customers.
18.4.2.3 Interpretive Issues.
If Service Provider determines in good faith that the performance of the Services
requires an interpretation of any aspect of a WG Compliance Directive (an “Interpretive
Issue”), Service Provider shall give WG a written request for interpretation, which shall
include the factual scenario in issue for resolution. WG shall as soon as practical
instruct Service Provider in writing with respect to each such Interpretive Issue so
presented to it, and Service Provider is authorized to act and rely on, and shall promptly
implement such WG instruction(s) in the performance and delivery of the Services as agreed
by the Parties in accordance with the Change Request Procedures. All WG interpretative
responses regarding Interpretive Issues shall be deemed WG Compliance Directives. WG
shall be responsible for any fines, penalties, sanctions or interest imposed on Service
Provider or WG by a Governmental Authority resulting from Service Provider’s failure to
comply with WG Compliance Directives to the extent such fines or penalties result directly
from WG’s failure to respond, within a reasonable period of time, to a written request by
Service Provider for interpretation of a WG Compliance Directive.
18.4.3 Material Impact on Changes of Law.
If the implementation of a WG Compliance Directive pursuant to Section
18.4.2.2 or a Change due to change in Laws Applicable to WG or Generally Applicable
Laws as they apply to WG or, (subject to Section 18.4.2.2), Laws Applicable to
Service Provider or Generally Applicable Laws as they apply to Service Provider, results
in WG being required to pay Service Provider charges that represent an increase of greater
than [***] in the monthly Charges for the Services to which such WG Compliance Directive
or Change relates, or a material reduction in the quality or scope of such Services, then
WG shall have the right to terminate such Services or this Agreement by giving Service
Provider [***] notice of such termination and payment of the applicable Termination
Charges for termination pursuant to this Section 18.4.3. Otherwise, Service
Provider and WG will execute the Change in accordance with the Change Request Procedures.
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
50
18.4.4 Notification.
Service Provider will notify WG of any changes in Laws Applicable to WG, Laws
Applicable to Service Provider or Generally Applicable Laws, or of any non-compliance by
WG with Laws Applicable to WG or Generally Applicable Laws of which Service Provider
employees providing the Services become aware; provided, however, that
notwithstanding anything to the contrary in the Agreement (i) failure of Service Provider
to notify WG of such changes in Laws Applicable to WG, Laws Applicable to Service Provider
or Generally Applicable Laws, or of such non-compliance with Laws Applicable to WG or
Generally Applicable Laws shall not be deemed a breach of this Agreement by Service
Provider, and (ii) nothing in this Section 18.4.4 or in this Agreement shall be
read to require Service Provider to maintain, staff or fund a legal compliance
organization. To the extent that Service Provider employees do not notify WG of changes
in Laws Applicable to WG or Generally Applicable Laws or of WG’s non-compliance with Laws
Applicable to WG or Generally Applicable Laws, Service Provider agrees to meet with WG and
discuss in good faith how Service Provider might improve its ability to provide such
notifications (subject always to the conditions in the previous sentence).
18.4.5 Miscellaneous.
Notwithstanding anything to the contrary in this Agreement:
(i) neither WG nor Service Provider will be required to undertake any
activity that would violate any Laws,
(ii) Service Provider will not be required to provide, and nothing in this
Agreement will be construed as the provision by Service Provider of, any legal,
accounting, audit, attest, tax or other similar professional advice, and
(iii) Service Provider will not be required to maintain, staff or fund a
legal compliance organization.
19. Indemnification
19.1 Service Provider’s Indemnity
19.1.1 General.
Service Provider shall indemnify, defend, and hold harmless the WG Indemnified
Parties, in accordance with the procedures described in Section 19.3, from and
against any and all Claims and threatened Claims to the extent arising out of, or relating
to, any of the following with respect to this Agreement:
51
(i) any bodily injury or damage to tangible property where such accident,
injury or damage results from [***] of Service Provider or its subcontractors or
employees;
(ii) subject to the Enhanced Cap, a violation of Data Protection Laws
applicable to Service Provider or a failure to follow a WG Compliance Directive
pertaining to Data Protection Laws, both with respect to WG Personal Data, unless
Service Provider is given a WG Compliance Directive, there is no way to comply
with both the WG Compliance Directive and the Data Protection Laws, and Service
Provider has previously informed WG that Service Provider cannot comply with
both the WG Compliance Directive and Data Protection Laws;
(iii) the employment, engagement or termination of the employment or
engagement of an employee or subcontractor of Service Provider or claim by any
employees, or subcontractors of Service Provider or on behalf of any employees or
subcontractors of Service Provider [***];
(iv) any failure by Service Provider to pay, remit or discharge any Taxes
(including interest and penalties) for which Service Provider is responsible as
set forth in Section 5.6 and Appendix 5, or any Work Agreement;
(v) any breach by Service Provider of any Assigned Agreement or acts or
omissions of Service Provider in connection with any Assigned Agreement occurring
subsequent to the assignment of such Assigned Agreement to Service Provider by
WG;
(vi) any claims made by Service Provider’s subcontractors or vendors in
connection with the Services provided hereunder except to the extent caused by WG
or its Affiliates;
(vii) (A) offers of employment to Transferring Employees by Service Provider
that are inconsistent with Exhibit G, to the extent inconsistent with
Exhibit G; and (B) except for such acts directed by WG to be undertaken
by Service Provider, any alleged act or omission by Service Provider or its
Personnel giving rise to potential liability arising out of or relating to (1)
any employment related claims of or on behalf of Transferred Employees arising on
and after the Hire Date and relating to their employment by Service Provider, and
(2) any claims that Service Provider has violated any Worker Notification Law or
other claims of or on behalf of Transferred Employees arising as a result of
claims arising after the Hire Date for breach of a written or oral contract of
employment with Service Provider, employee benefits plans, policies, or programs
for which the Transferred Employees are eligible in
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
52
accordance with the terms of such express contract of employment with
Service Provider, or with respect to any claims by such employees under such
plans, policies, or programs during the Transferred Employees’ employment with
Service Provider;
(viii) any breach of Service Provider’s representations or warranties set
forth in Section [***] ; and
(ix) Service Provider’s failure to obtain, maintain or comply with
applicable Consents.
19.1.2 Intellectual Property.
Service Provider shall indemnify, defend and hold harmless the WG Indemnified
Parties, in accordance with the procedures described in Section 19.3, from and
against any and all Claims arising out of any actual or alleged infringement or
misappropriation of any Intellectual Property Rights owned by a third party relating to
the [***] (collectively, “Service Provider Indemnified Items” and individually, a “Service
Provider Indemnified Item”), including any Claims alleging or establishing that: (i) WG’s
permitted use under this Agreement of the Service Provider Indemnified Items infringes or
misappropriates any Intellectual Property Rights of a third party; or (ii) the processes
utilized by Service Provider in providing the Services to WG infringe or misappropriate
any Intellectual Property Rights of a third party; provided, however, that Service
Provider’s obligation to indemnify for patent infringement shall be limited to (A) for
Services, to patents that have issued at any time prior to the Execution Date [***], and
(B) for Deliverables and WG Work Product, to patents that have issued any time prior to
the Execution Date[***], in each case, in [***]. Notwithstanding anything to the contrary
under this Agreement, Service Provider will not have any liability whatsoever under this
Agreement with the respect to any Claim or threatened Claim made [***].
19.1.3 Limitations.
Service Provider’s indemnification obligations under Section 19.1.2 shall not
extend to any Claims to the extent resulting from, or relating to (i) WG’s use of the
Service Provider Indemnified Item outside the scope of any applicable license granted by
Service Provider; (ii) modification of a Service Provider Indemnified Item, unless such
modification was done with the authorization of Service Provider, or at the request of
Service Provider or someone working on behalf of Service Provider; (iii) WG’s failure to
use corrections or enhancements made available by Service Provider at no additional charge
to WG; (iv) WG’s use of the Service Provider Indemnified Item in combination with any
product or information not owned or developed by Service Provider, where such combination
causes the infringement [***]; (v) WG’s distribution, marketing or use for the benefit of
third parties [***]; or (vi) the use of
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
53
information, direction, specification or materials provided by WG or any third party
(excluding subcontractors and Affiliates of Service Provider) to the extent such
information, direction, specification or materials constitute the elements of the claim).
19.1.4 Duty to Correct.
In addition to any other remedy available to WG under this Agreement or otherwise, if
the Service Provider Indemnified Item or any portion thereof is held to constitute an
infringement of any Intellectual Property Right held by any third party or its use as
contemplated by this Agreement be enjoined or threatened to be enjoined, Service Provider
shall promptly notify WG and within a commercially reasonable period of time, at Service
Provider’s expense, (i) procure for WG the right to continue to use the same, as delivered
under the applicable Work Agreement, or (ii) replace or modify the Service Provider
Indemnified Item, or portion thereof with a version that is non-infringing, provided that
the replacement or modified version must be equivalent to or better than the Service
Provider Indemnified Item being replaced or modified. If (i) and (ii) are not available
to Service Provider, in addition to any other damages or expenses reimbursed under this
Section 19.1, Service Provider shall reimburse WG for any separate, discernable
Charges paid by WG to Service Provider for any affected Deliverable or Work Product [***].
19.1.5 Third Party Indemnities.
Service Provider shall use commercially reasonable efforts to extend the benefit to
WG Indemnified Parties of any warranties and indemnities related to Intellectual Property
Rights and, with respect to any Software provided by Service Provider to WG, to freedom of
such Software from viruses or other malicious code, which warranties and indemnities are
provided to Service Provider through any Service Provider Third Party Supplier Agreements,
or through any agreement with a third party licensing such Software to Service Provider.
19.2 WG’s Indemnity.
19.2.1
WG shall defend, indemnify and hold harmless the Service Provider Indemnified
Parties, in accordance with the procedures described in Section 19.3, from and
against any and all Claims and threatened Claims to the extent arising out of, or relating
to, any of the following with respect to this Agreement:
(i) any bodily injury or damage to tangible property where such accident,
injury or damage results from [***] of WG or its subcontractors and employees;
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
54
(ii) the employment, engagement or termination of the employment or
engagement of an employee or subcontractor of WG or claim by any employees, or
subcontractors of WG or on behalf of any employees or subcontractors of WG [***];
(iii) any failure by WG to pay, remit or discharge any Taxes (including
interest and penalties) for which WG is responsible as set forth in Section
5.6 and Appendix 5 or any Work Agreement;
(iv) any breach by WG of any Assigned Agreement or acts or omissions of WG
in connection with any Assigned Agreement occurring before the effected
assignment of such Assigned Agreement to Service Provider by WG;
(v) any claims made by WG’s subcontractors, Third Party Providers or vendors
in connection with the Services provided hereunder except to the extent caused by
or made by Service Provider or its Affiliates;
(vi) any breach of WG’s representations or warranties set forth in
Section [***];
(vii) except for such acts directed by Service Provider to be undertaken by
WG, (A) any employment-related claims of or on behalf of Affected Employees
arising prior to the Hire Date and relating to their employment with WG or its
Affiliate, regardless of the date upon which the claim is made, and claims
arising out of or related to cessation of their employment with WG or its
Affiliates, (B) any claims that WG has violated any Worker Notification Law or
any other employment related claims of or on behalf of Affected Employees (other
than claims of or on behalf of Transferred Employees arising from and after the
Hire Date and relating to their employment by Service Provider), and claims of
Transferred Employees arising from a written or oral contract of employment
entered into by WG or its Affiliates with any such Transferred Employee, (C) any
claims alleging that WG or its Affiliates is bound by or a party to any
collective bargaining agreement or other agreement with any trade union, council
of trade unions, employee bargaining agency or affiliated bargaining agent
relating to any of the Transferring Employees; and (D) any employment related
claims of or on behalf of Affected Employees arising out of acts directed by WG
to be undertaken by Service Provider with respect to such employees;
(viii) subject to the Enhanced Cap, a violation of Data Protection Laws
applicable to WG or a Claim brought against Service Provider to the extent based
on Service Provider’s compliance with a WG Compliance Directive pertaining to
Data Protection Laws, both with respect to WG
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
55
Personal Data (but excluding any Claims to the extent based on Service
Provider’s failure to follow WG Compliance Directive pertaining to Data
Protection Laws); and
(ix) WG’s failure to obtain, maintain or comply with applicable Consents.
19.2.2 Intellectual Property.
WG shall indemnify, defend and hold harmless Service Provider Indemnified Parties, in
accordance with the procedures described in Section 19.3, from and against any and
all Claims arising out of any actual or alleged infringement or misappropriation of any
Intellectual Property Rights owned by a third party relating to [***] (collectively, “WG
Indemnified Items,” and individually, a “WG Indemnified Item”), including any Claims
alleging or establishing that: Service Provider’s permitted use under this Agreement of a
WG Indemnified Item infringes or misappropriates any Intellectual Property Rights of a
third party; provided, however, that WG’s obligation to indemnify for
patent infringement shall be limited to patents that have issued at any time prior to the
Execution Date [***] in [***]. Notwithstanding anything to the contrary under this
Agreement, WG will not have any liability whatsoever under this Agreement with the respect
to any Claim or threatened Claim made by [***].
19.2.3 Limitations.
WG’s indemnification obligations under Section 19.2.2 shall not extend to any
Claims to the extent resulting from, or relating to (i) Service Provider’s use of the WG
Indemnified Item outside the scope of the license granted by WG; (ii) modification of a WG
Indemnified Item, unless such modification was done with the authorization of WG, or at
the request of WG or someone working on behalf of WG; (iii) Service Provider’s failure to
use corrections or enhancements made available by WG at no additional charge to Service
Provider; (iv) Service Provider’s use of the WG Indemnified Item in combination with any
product or information not owned or developed by WG, where such combination causes the
infringement [***]; (v) Service Provider’s distribution, marketing or use for the benefit
of third parties (excluding Service Provider’s Affiliates) of the WG Indemnified Item; or
(5) the use of information, direction, specification or materials provided by Service
Provider or any third party (excluding subcontractors and Affiliates of WG) to the extent
such information, direction, specification or materials constitute the elements of the
claim).
19.2.4 Third Party Indemnities.
WG shall use commercially reasonable efforts to extend the benefit to Service
Provider Indemnified Parties of any warranties and indemnities related to Intellectual
Property Rights and, with respect to any third party Software provided by
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WG to Service Provider, freedom of such Software from viruses or other malicious
code, which warranties and indemnities are provided to WG through any WG Third Party
Supplier Agreements, or through any agreement with a third party licensing such Software
to WG.
19.3 General Provisions and Procedures.
The indemnification provisions set forth in this Agreement are subject to the following
general provisions and procedures:
19.3.1 Notice.
Any Indemnified Party entitled to indemnification under this Agreement shall provide
the Indemnifying Party with an Indemnification Notice regarding the applicable Claim
promptly but in any event within [***] after the Indemnified Party receives a summons, or
within [***] after the Indemnified Party receives any other written communication;
provided that the failure of the Indemnified Party to undertake such actions shall
not relieve the Indemnifying Party of any obligation it may have to indemnify, except and
only to the extent that the Indemnifying Party’s ability to fulfill such obligation has
been actually and materially prejudiced thereby.
19.3.2 Counsel.
The Indemnified Party shall permit the Indemnifying Party to answer and defend the
claim. The Indemnifying Party shall permit the Indemnified Party to participate in its
own defense with its own counsel at its own expense. If the Indemnified Party elects to
participate in its own defense, the Indemnifying Party shall agree to consider in good
faith the views of the Indemnified Party and its counsel and to keep the Indemnified Party
and its counsel reasonably informed of the progress of the defense, litigation,
arbitration, or settlement discussions relating to such claims.
19.3.3 Settlement.
The Indemnifying Party shall not settle any claims against the Indemnified Party that
involves anything other than a waiver of claims and the payment of a settlement by the
Indemnifying Party except with the Indemnified Party’s prior written permission. The
Indemnifying Party shall not be responsible for any settlement made by the Indemnified
Party without the Indemnifying Party’s written permission. In the event the Indemnified
Party and Indemnifying Party agree to settle a claim, the Indemnifying Party shall not
publicize the settlement without first obtaining the Indemnified Party’s written
permission.
19.3.4 Third Party Losses.
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The Indemnifying Party shall use reasonable efforts to mitigate liability, damages,
and other losses suffered in connection with this Article 19, including where any
damages can be mitigated by lawfully pursuing recovery from third parties, in which case
the Indemnifying Party shall conduct or permit diligent efforts to so recover.
20. Limitations of Liability.
20.1 Limitation on Direct Damages.
Except as provided in this Section 20.1 and Section 20.4 below, the total and
cumulative liability of each Party, its Affiliates, and its and their respective shareholders,
directors, officers, employees, agents, subcontractors and licensors, for direct damages and
Acknowledged Direct Damages (whether a claim therefor is based on warranty, contract, tort
(including negligence or strict liability), statute, or otherwise) connected with or arising or
resulting from any performance or nonperformance of Services under this Agreement shall be limited
in the aggregate for all claims to the Cap. Each Party agrees that the damage limitations in this
Section 20.1 shall not be deemed or alleged to have caused this Agreement to fail of its
essential purpose. Charges paid and payable by WG to Service Provider pursuant to Article
6, Invoicing and Payment [***] shall not apply against the Cap or the Enhanced Cap and will not
be considered excluded by Section 20.3 below. If the liability of a Party is based on the
[***] the limitation in this Section 20.1 will be expanded to include an additional amount
so that the aggregate liability of that Party under this Section 20.1 will be limited in
the aggregate for all claims to the Enhanced Cap.
20.2 Aggregate Liability.
For the avoidance of doubt, the aggregate liability of a Party under Section 20.1 will
never be greater than the Enhanced Cap.
20.3 Exclusion of Consequential Damages and Certain Other Damages.
NOTWITHSTANDING ANY PROVISION OF THIS AGREEMENT THAT MAY BE TO THE CONTRARY (EXCEPT AS
EXPRESSLY PROVIDED IN SECTION 20.4 BELOW), NEITHER PARTY, NOR ITS AFFILIATES OR ITS OR
THEIR RESPECTIVE SHAREHOLDERS, DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, SUBCONTRACTORS, OR
LICENSORS, SHALL BE LIABLE TO THE OTHER PARTY, OR ITS DIRECTORS, OFFICERS, EMPLOYEES, AGENTS,
MEMBERS, AFFILIATES, OR SUBCONTRACTORS, FOR CLAIMS FOR INCIDENTAL, INDIRECT, PUNITIVE, EXEMPLARY,
CONSEQUENTIAL, OR SPECIAL DAMAGES, INCLUDING DAMAGES FOR LOSS OF PROFITS, LOSS OF USE OR REVENUE,
LOSS OF SAVINGS, OR LOSSES BY REASON OF COST OF CAPITAL, CONNECTED WITH, OR ARISING OR
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RESULTING FROM, ANY PERFORMANCE OR LACK OF PERFORMANCE UNDER THIS AGREEMENT, EVEN IF SUCH
DAMAGES WERE FORESEEABLE OR THE PARTY SOUGHT TO BE HELD LIABLE WAS ADVISED OF THE POSSIBILITY OF
SUCH DAMAGES, AND REGARDLESS OF WHETHER A CLAIM IS BASED ON CONTRACT, WARRANTY, TORT (INCLUDING
NEGLIGENCE OR STRICT LIABILITY), VIOLATION OF ANY APPLICABLE DECEPTIVE TRADE PRACTICES ACT, OR ANY
OTHER LEGAL OR EQUITABLE PRINCIPLE.
20.4 Exceptions.
The limitations set forth in Section 20.1 and Section 20.2 and the
exculpations set forth in Section 20.3 shall not apply to:
(i) damages resulting from Service Provider’s refusal to provide the
Services or Termination Assistance Services (for purposes of this subsection (i),
“refusal” means the failure to start or intentional cessation by [***] (without
good faith efforts to promptly rectify such failure to start or intentional
cessation after written notice from [***]) of the performance of all or a
material portion of the Services or Termination Assistance Services (a) with
respect to Services, for [***] after [***] gives notice of its intentional
cessation of all or a material portion of the Services or [***] after [***] gives
notice to [***] that [***] has intentionally ceased [***] all or a material
portion of the Services (the [***] to be measured from [***], and (b) with
respect to Termination Assistance Services for [***] immediately following notice
[***] of its intentional cessation of all or a material portion of the Services
or [***] after [***] gives notice [***] that [***] has intentionally [***] of all
or a material portion of the Services [***], but shall not mean [***] based on a
good faith belief that [***];
(ii) any liability caused by or arising from (a) Willful Misconduct of a
Party or (b) [***], or (c) any bodily injury or damage to tangible property where
such injury or damage results from [***], unless due to the acts, omissions,
negligence or Willful Misconduct of the other Party or its subcontractors;
(iii) either Party’s indemnification obligations set forth in Article 19
(except with respect to the indemnities [***]; or
(iv) breach of [***] by either Party.
20.5 Force Majeure.
20.5.1 Force Majeure Events.
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Subject to Section 20.5.2, neither Party shall be liable for any failure or
delay in the performance of its obligations under this Agreement to the extent such
failure or delay both is caused by a Force Majeure Event. The Parties expressly
acknowledge that Force Majeure Events do not include the regulatory acts of governmental
agencies in the ordinary course, labor strikes by the workforce of the Party subject to
the failure or delay, or the non-performance of subcontractors or third party suppliers of
the non-performing Party, unless such failure or non-performance by a subcontractor or
third party suppliers is itself caused by a Force Majeure Event. Upon the occurrence of a
Force Majeure Event, the non-performing Party shall be excused from any further
performance or observance of the affected obligation(s) for as long as such circumstances
prevail, and such Party continues to attempt to recommence performance or observance to
the greatest extent possible without delay.
20.5.2 Business Continuity Plan.
Notwithstanding any other provision of this Agreement, a Force Majeure Event shall
(i) obligate and require Service Provider to perform its obligations under the Business
Continuity Plan within the time period described therein and (ii) not relieve Service
Provider from any performance obligation to the extent the Business Continuity Plan was
intended to prevent or minimize the occurrence of the Force Majeure Event. Service
Provider shall implement the redundancy requirements set forth in the Business Continuity
Plan and/or the applicable Work Agreements. The Business Continuity Plan shall provide
sufficient redundancy with respect to core aspects of the Services to minimize the impact
of any Force Majeure Event. If Service Provider is unable to perform the Services in any
material respect, Service Provider shall immediately notify WG of such inability. WG, in
its sole discretion, may elect to provide Service Provider a reasonable opportunity to
recommence performance. WG may procure such Services from an alternate source and suspend
Service Provider’s provision of such Services for the duration of the agreement executed
between WG and such alternate source in respect of the provision of such services. WG
will use commercially reasonable efforts to minimize the duration of the agreement to
procure such services from such alternate source. Service Provider will use commercially
reasonable efforts to coordinate its re-initiation of the performance of the Services in
conjunction with the termination of such agreement pursuant to which WG receives services
from the alternate source. Service Provider will credit WG for cost for any services that
must be procured from such alternate source for a period of [***] up to the amount equal
to [***] of the Charges paid to Service Provider by WG during this [***] period; however,
WG’s obligations to continue paying the Charges to Service Provider will remain in full
force and effect.
20.6 Duty to Mitigate.
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Each Party has a duty to mitigate the damages that would otherwise be recoverable from the
other Party pursuant to this Agreement by taking appropriate and commercially reasonable actions to
reduce or limit the amount of such damages.
21. Insurance.
For the avoidance of doubt, the insurance that Service Provider is required to maintain
hereunder shall cover Service Provider and its Affiliates.
21.1 Service Provider Insurance Coverage.
During the term of this Agreement, Service Provider shall carry and maintain the following
insurance coverage through an insurance company that has a Best’s Rating of [***] or higher and a
Financial Size Category of [***] or higher, as such ratings are assigned by A.M. Best Company, Inc.
21.1.1 Workers’ Compensation.
Workers’ compensation insurance in compliance with the Laws in the jurisdiction where
the Services will be performed, and Employers Liability Insurance with a limit of not less
than [***] each employee.
21.1.2 Commercial General Liability.
Commercial general liability insurance, occurrence form, including contractual
liability coverage, with limits of not less than $1,000,000 per occurrence and $2,000,000
as an annual aggregate, $2,000,000 Products and Completed Operations aggregate; $1,000,000
Personal Injury and Advertising injury per offense. [***]
21.1.3 Automobile Liability.
Automobile liability insurance for Service Provider vehicles owned, hired and
non-owned, with a combined single limit of $2,000,000 per accident. [***]
21.1.4 Crime.
Crime insurance that [***]. The policy shall also cover theft of money, securities
and other property of WG by Service Provider’s employees while such employees are involved
in the provision of Services, with a limit of not less than [***].
21.1.5 Professional Liability.
Professional liability insurance providing “errors and omissions liability” or
equivalent coverage for the work being performed, with limits of $[***]. The policy or
policies shall include coverage for Service Provider for acts [***].
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21.1.6 Excess Liability.
Excess liability insurance, Umbrella Form, shall carry coverage in excess of the
limits provided for in the above Employers Liability, Commercial General Liability and
Automotive Liability policies, with a limit of not less than $[***].
21.1.7 Property Coverage.
Property coverage will be maintained providing [***] for the property of others that
is in Service Provider’s care, custody and control with limits not less than the [***] of
the property in question. Such coverage shall name [***].
It is acknowledged by the Parties that should any legislation in any jurisdiction require or have
the effect of requiring any amendment to the provisions of, or the obligations imposed by, this
Section in respect of that jurisdiction, the necessary amendments to this Section shall be agreed
between the Parties (such amendments applying in relation to that jurisdiction only) and recorded
in the applicable Work Agreement. Service Provider shall also monitor its subcontractors performing
Services so that such subcontractors carry insurance coverage with respect to the Services that
Service Provider deems appropriate under the circumstances.
21.2 Certificates.
Service Provider shall ▇▇▇▇▇ ▇▇ the [***] required above using a [***] or if such endorsement
is no longer available, Service Provider shall cause the policy to be endorsed to grant this
status. Evidence of the above insurance policies shall be provided to WG on a standard ▇▇▇▇▇ form
25 S, or its equivalent, within fifteen (15) days of the Execution Date and within fifteen (15)
days of the renewal of each such policy, [***]:
The following wording shall be used on the Certificate: “Washington Gas Light Company, its
successors, subsidiaries, directors, officers, agents and employees are named as additional
insureds on the general and automobile liability policy listed above [***]. Such coverage
is primary, not contributory, and not in excess of any other insurance of Certificate Holder
to the extent required for Service Provider to meet its contractual obligations.”
21.3 [***].
[***]
21.4 Change in A.M. Best Rating.
If, during the term of this Agreement, Service Provider’s insurer fails to meet or exceed the
A.M. Best rating required by Section 21.1, Service Provider shall, procure insurance from
an alternative insurer who does meet or exceed such rating at the policy renewal date immediately
following such change in rating.
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22. Dispute Resolution Process.
Any Dispute between the Parties shall be resolved as provided in this Article 22.
22.1 Informal Dispute Resolution.
Informal dispute resolution procedures are set forth in Appendix 12.
22.2 Formal Proceedings.
Formal proceedings for the resolution of a Dispute may be commenced after the earlier of (i)
the designated representatives concluding that amicable resolution of the Dispute through continued
negotiation does not appear likely, or (ii) [***] after the initial request to negotiate the
Dispute, except for Disputes related to disputed amounts in invoices, for which such time period
shall be [***]. Notwithstanding the foregoing, each Party may institute formal proceedings at any
time in order to avoid the expiration of any applicable limitations period, to preserve a superior
position with respect to other creditors, or to seek equitable relief.
22.3 Equitable Relief.
A Party may seek equitable relief if (i) a Party makes a determination that a breach (or
potential breach) of the terms of this Agreement by the other Party may result in damages or
consequences that shall be immediate, severe, and incapable of adequate redress after the fact, so
that a temporary restraining order or other immediate injunctive relief is the only adequate
remedy, or (ii) a third party necessary to the resolution of the Dispute cannot be joined in the
escalation process described in this section.
22.4 Choice of Law.
THE INTERNAL LAWS OF THE STATE OF NEW YORK EXCLUDING ITS CONFLICTS OF LAW PRINCIPLES SHALL
GOVERN THIS AGREEMENT. WITH RESPECT TO ANY AND ALL LITIGATION ARISING OUT OF, OR RELATED TO, THE
TERMS OF, THE TRANSACTIONS AND RELATIONSHIPS CONTEMPLATED BY, OR BREACH OR ALLEGED BREACH OF, THIS
AGREEMENT, SERVICE PROVIDER HEREBY IRREVOCABLY CONSENTS (I) TO THE EXCLUSIVE JURISDICTION OF, AND
VENUE IN, ANY FEDERAL COURT OF COMPETENT JURISDICTION LOCATED IN DISTRICT OF COLUMBIA FOR THE
PURPOSES OF ADJUDICATING ANY MATTER ARISING FROM OR IN CONNECTION WITH THIS AGREEMENT AND THE
NONEXCLUSIVE JURISDICTION OF LOCAL COURTS WITH RESPECT TO DATA PROTECTION CLAIMS OR OTHER MATTERS
REQUIRED TO BE BROUGHT IN A LOCAL COURT OR FOR MATTERS FOR WHICH SUCH DISTRICT OF COLUMBIA COURTS
DO NOT EXERCISE JURISDICTION AND (II) AGREES TO ONLY INSTITUTE LITIGATION IN SUCH COURTS. The
Parties further irrevocably consent to the non-exclusive jurisdiction of any other court located
within a jurisdiction that encompasses assets of a Party
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against which a judgment has been rendered for the enforcement of such judgment or award
against the assets of such Party.
22.5 Waiver of Jury Trial.
EACH PARTY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT TO TRIAL BY
JURY IN THE RESOLUTION OF ANY DISPUTE ARISING OUT OF, OR RELATING TO, THIS AGREEMENT.
23. Termination.
23.1 Termination by WG.
23.1.1 Termination for Convenience.
WG may terminate this Master Services Agreement, any Work Agreement, any Service
Tower, or all Leak Call Services for convenience at any time after [***], upon [***];
provided, however, that (A) WG may terminate [***]. Service Provider
shall use all reasonable efforts to minimize costs upon receipt of such notice.
23.1.2 Cap Refresh.
In the event that Service Provider owes to WG direct damages [***] as a result of one
or more of the following (i) an agreement by Service Provider that it owes WG certain
direct damages, (ii) a settlement agreed to by the Parties, (iii) an order from a court of
competent jurisdiction or (iv) a ruling as a result of an arbitration where the Parties
have agreed that such arbitration would be binding, and Service Provider does not agree to
refresh the Cap to its original amount (i.e., none of such recovered direct damages shall,
after such refresh, be considered to have applied against the Cap) within [***] after a
request to refresh the Cap has been made by WG, then WG may terminate this Agreement, the
applicable Work Agreement or the applicable Service Tower upon no less than [***] prior
written notice to Service Provider [***].
23.1.3 Termination for Cause.
WG may terminate this Agreement or any Work Agreement, in whole or in part, for cause
in the event of (i) Service Provider’s material breach of its obligations or warranties or
(ii) a series of breaches by Service Provider of its obligations under this Agreement that
may be immaterial if considered individually, but are material in the aggregate, (provided
that all such breaches upon which WG is basing its material breach claim pursuant to this
subsection (ii) shall have occurred within the [***]
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immediately preceding any notice of material breach), if such material breach is not
cured within [***] after WG notifies Service Provider of such material breach (“Cure
Period”), or in the case of a breach that cannot be cured within the Cure Period, Service
Provider has [***]. Notwithstanding the foregoing, WG may terminate this Agreement or any
Work Agreement, in whole or in part, for cause in the event of Service Provider’s breach
of its obligations or warranties in [***], if such breach is not cured within [***] after
WG notifies Service Provider of such breach (“Accelerated Cure Period”), or in the case of
a breach that can be cured but not within the Accelerated Cure Period, if Service Provider
has [***], provided, in either case, that WG discusses the breach with Service Provider
prior to exercising the foregoing right to terminate. The express acknowledgment in this
Article 23 that certain events constitute grounds for WG to terminate for cause
does not imply that other events (including, for example [***]) cannot constitute a
material breach of this Agreement or cannot therefore constitute grounds for WG to
terminate for cause under other sections of this Agreement. WG shall not be obligated to
pay any Termination Charge with respect to a termination under this Section 23.1.3
unless otherwise expressly stated in this Agreement.
(i) Termination for Inability to [***].
WG may terminate this Agreement for cause if Service Provider’s acts or
omissions in breach of its obligations under this Agreement is the [***], or (ii)
[***] after WG so notifies Service Provider of such breach (provided that all
such breaches upon which WG is basing its breach claim pursuant to this
Section 23.1.3(i) shall have occurred within the [***] period immediately
preceding any notice of such breach).
(ii) Termination for Breach that [***].
WG may terminate this Agreement for cause if Service Provider action in
breach of its obligations under the Agreement is the [***] (provided that all
such breaches upon which WG is basing its breach claim pursuant to this
Section 23.1.3(ii) shall have occurred within the [***] period
immediately preceding any notice of such breach).
(iii) Termination for [***].
(A) If (1) the Service Provider proximately causes [***] with respect to
the Services that is a responsibility of Service Provider under this Agreement,
(2) such [***], (3) such [***], (4) such [***], and (5) such [***] in the next
or any future reporting period and WG reports to [***] and [***], WG may
terminate this Agreement for cause upon thirty (30) days notice, with no further
opportunity to cure.
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(B) If the Service Provider [***] with respect to [***] with respect to the
Services that is a responsibility of Service Provider under this Agreement and
[***] does not arise in accordance with subsection (A) above, WG and the Service
Provider will agree on a [***]. If the Service Provider does not [***] within
the time agreed to by the Parties and WG [***] and [***], WG may terminate this
Agreement for cause upon [***], with no further opportunity to cure.
(iv) Termination of Leak Call Services.
WG may terminate Leak Call Services for cause if [***] and such failure
leads to a reportable incident (as defined by the United States Department of
Transportation).
(v) Termination for Failure to Complete Transition Plan.
WG may terminate an individual Service Tower for cause if Service Provider
fails to meet a Transition Critical Milestone in the applicable Service Tower by
[***] (excluding WG Holidays) after the Commencement Due Date for such Transition
Critical Milestone. In addition, WG may terminate Work Agreement No. 1 for cause
if Service Provider fails to meet a [***] by [***] (excluding WG Holidays) after
the Commencement Due Date for such Transition Critical Milestone.
(vi) Termination for Service Level Default.
In the event that (i) Service Provider fails to perform in accordance with the
Minimum Service Level for [***] or during [***] out of any [***] period, or (ii) the total
value of Service Level Credits accruing to WG and not earned back by Service Provider over
any rolling [***] period following the Services Commencement Date exceeds the [***] for
the [***] during such period where the [***], WG shall have the right to terminate this
Agreement, or the applicable Work Agreement, for cause.
23.1.4 Change of Control of Service Provider.
In the event of a Change of Control of Service Provider, including a spin off or an
initial public offering of Service Provider business entity used to provide the Services
such that Service Provider no longer enjoys control over that business entity but
excluding a Change of Control between entities within Service Provider’s corporate
structure, WG shall have the right to terminate this Agreement or any Work Agreement upon
at least thirty (30) days written notice with the payment of a Termination Charge to
Service Provider as set forth in a Work Agreement.
23.1.5 Services to Former Affiliates; Termination for Change of Control of WG.
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(i) If a WG entity is divested by WG, WG shall elect either (A) to terminate
that part of the Services that was provided to the divested entity pursuant to
the termination provisions, without payment of a Termination Charge, or (B) to
require Service Provider to continue to provide Services to the divested entity
on the same terms and to the same standards that such services were previously
provided, for up to [***] after divestiture, the cost of such Services to be
underwritten by WG or to be paid directly by the divested entity.
(ii) In the event that WG or any Affiliate of WG or any portion of the
business or operations thereof becomes a Former Affiliate, Service Provider
shall, at WG’s option, provide such Former Affiliate: (A) up to [***] of the
Termination Assistance Services set forth in each applicable Work Agreement with
respect to the Services such Former Affiliate was receiving from Service Provider
prior to such Change in Control, commencing as soon as reasonably practical after
the date that such Affiliate has become a Former Affiliate, and (B) continued
Services until such Former Affiliate, in the reasonable opinion of WG, is able to
procure services similar to the Services from a third party or provide such
services itself, or until [***] after the date that such Affiliate has become a
Former Affiliate, whichever is earlier (but in no event longer than the Term
under which such Former Affiliate was receiving Services). To the extent the
applicable charging methodology or resource baseline includes the resources
necessary to provide such Termination Assistance Services and continued Services,
such Termination Assistance Services and continued Services shall be provided to
such Former Affiliate in accordance with such charging methodology or resource
baseline.
23.1.6 Termination for Insolvency or Bankruptcy.
WG may terminate this Agreement, provided that WG pays the Termination Charge to
Service Provider set forth in the applicable Work Agreement, within thirty (30) days after
WG receives or has notice of Service Provider: [***].
23.1.7 Termination for Benchmarking.
In the event that WG exercises its right to terminate in accordance with
Paragraph 6.2 of Appendix 7, WG may terminate the relevant benchmarked
Service Tower by giving Service Provider at least ninety (90) days prior written notice
and upon payment of the applicable Termination Charges set forth in the applicable Work
Agreement.
23.1.8 Termination for Force Majeure.
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WG may terminate this Agreement, the applicable Work Agreement, or any affected
Service if Service Provider is unable to perform the Services in any material respect for
more than [***], or for more [***], as a result of a Force Majeure Event;
provided, however, that (i) WG will only terminate any Service affected by
such Force Majeure Event [***], (ii) in the event of (i), WG will pay the Termination
Charge set forth in the applicable Work Agreement, and (iii) this Section 23.1.8
shall not apply to the extent that Service Provider is able to perform the Services in
accordance with this Agreement but WG is unable to receive such Services.
23.1.9 Cross-Termination.
In the event WG is entitled to terminate a Work Agreement under this Agreement, WG
shall also have the right, but not the obligation, to terminate [***].
23.1.10 Partial Termination.
If the Services are terminated in part, or if less than all Work Agreements are
terminated, Service Provider shall continue to provide the remaining Services pursuant to
the terms of this Agreement, provided that (i) the Parties shall agree to an equitable
adjustment in Charges pursuant to Change Request Procedures set forth in Appendix
12.1, and (ii) the Parties may set forth, in the applicable Work Agreements, any
Services dependencies such that termination of a specified Service or Work Agreement
requires cross-termination of another Service or Work Agreement; provided,
however, that the foregoing shall not preclude WG from terminating Leak Call
Services independently of the termination of any other Services.
23.1.11 Extension of Termination Effective Date.
WG may extend the effective date of termination of the Services or any Work Agreement
one time, at WG’s sole discretion, provided that WG gives notice to Service Provider [***]
notice prior to the termination of the Services and the total duration of such extension
shall not exceed [***] following the original effective date of termination. Any such
extension shall be counted as part of the period specified in Section 4.1 and
Section 4.2 during which Service Provider shall continue to provide Services for
fees specified in this Agreement but will not effect the [***] period set forth in
Section 20.4(i).
23.2 Termination by Service Provider.
23.2.1 Termination for Convenience.
Service Provider may terminate this Master Services Agreement for convenience at any
time after [***] from the Execution Date, provided that Service
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
68
Provider shall provide at least [***] notice to WG, and provided further that such
termination shall not terminate any Work Agreement then in effect, and the terms of this
Agreement shall continue to apply to such Work Agreements.
23.2.2 Termination for WG’s Failure to Pay.
Service Provider may terminate this Agreement and any Work Agreement if (i) WG fails
to pay Service Provider undisputed invoiced amounts due and payable under such Work
Agreement for [***] after such amounts become due and payable, provided that WG fails to
pay such undisputed invoiced amounts or provide evidence of a Dispute relating to such
undisputed invoiced amounts, in each case for [***] after WG’s receipt of Service
Provider’s written notice of such failure, or (ii) WG fails to deposit disputed amounts in
escrow as required in Section 6.7 or withholds disputed charges in excess of the
Maximum Withholding Amount for [***] after WG’s receipt of Service Provider’s written
notice of such failure or withholding in excess of the Maximum Withholding Amount, and
(iii) Service Provider has exhausted the Dispute Resolution Process set forth in
Article 22, or such failure or withholding is not cured within [***] from Service
Provider’s written notice, whichever occurs first. Except as expressly set forth in this
Section 23.2, WG’s failure to perform any of WG’s obligations under this Agreement
shall not be grounds for termination of this Agreement or any Work Agreement by Service
Provider but Service Provider shall not be prohibited from seeking any other remedies
(other than suspension of Service Provider’s performance) it may have against WG under
this Agreement or applicable Law.
23.3 Effect of Termination.
Any termination by WG for material breach by Service Provider shall not prohibit WG from
seeking any other remedies it may have against Service Provider under this Agreement or applicable
Law. Any termination shall not, however, relieve: (i) WG of its obligation to pay any undisputed
charges incurred under this Agreement prior to such termination (with such payment to be the pro
rata portion of the relevant fixed fee for corresponding work completed if the Services under this
Agreement or any applicable Work Agreement are rendered by Service Provider on a fixed fee basis);
(ii) Service Provider from providing WG with Termination Assistance Services as set forth in
Section 23.4 below and this Agreement and further described in the Work Agreement, which
such obligation shall be absolute and unconditional; provided, however, that (A) in
the event that Service Provider rightfully gives notice of termination pursuant to Section
23.2, Service Provider may require WG to pay in advance all outstanding monthly Charges, any
amounts being withheld in excess of the Maximum Withholding Amount, the monthly Charges for the
next month and, if applicable, a reasonable estimate of the variable
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
69
fees for the next month before providing any Termination Assistance Services and (B) if WG has
not complied with its obligations to pay in advance as provided in the previous sentence, Service
provider may refuse to provide Termination Assistance Services; or (iii) both Parties from
performing any obligation that is intended to survive the termination of this Agreement or the
applicable Work Agreement.
23.4 Termination/Expiration Assistance.
In the event of the expiration or WG’s notice to Service Provider of the termination of a Work
Agreement or this Agreement for any reason, Service Provider shall, upon WG’s request, provide the
Termination Assistance Services. Without limiting the foregoing, Service Provider shall agree to
(i) provide the specific Termination Assistance Services set forth in the applicable Work
Agreement, provided that if Service Provider terminates this Agreement pursuant to Section
23.2, WG shall pay for such Termination Assistance Services in advance in accordance with
Section 23.3.
23.5 Equitable Remedies.
Subject to Section 23.3 above, Service Provider acknowledges that, in the event
Service Provider breaches, or attempts or threatens to breach, its obligation to provide WG
assistance in accordance with Section 23.4, then notwithstanding the Dispute Resolution
Process set forth in Article 22, WG shall be entitled to seek an injunction, specific
performance, or other equitable relief in any court of competent jurisdiction.
23.6 Service Provider Employees and Contracts.
Upon expiration or termination of a Work Agreement or this Agreement for any reason, WG may
(i) subject to Section 24.17, hire those employees of Service Provider and Service
Provider’s Affiliates who were substantially dedicated to providing the Services who wish to be
hired, (ii) take assignment of contracts and licenses used and entered into exclusively to provide
the Services, and Service Provider shall use commercially reasonable efforts so (A) that such
contracts are assigned to WG, or (B) that WG can otherwise obtain the rights under such contracts
on substantially similar terms directly from the third party to such contract, and (iii) acquire
assets used by Service Provider exclusively to provide the Services at a price to be agreed upon by
the Parties, plus applicable Taxes.
23.7 Service Provider Subcontractors.
Service Provider agrees that it will not enter into agreements with its subcontractors that
are providing the Services that contain provisions that would expressly preclude such
subcontractors from (x) working with or for WG or any of its Affiliates after the termination or
expiration of the applicable Work Agreements, or (y) providing services that are not the same as or
substantially similar to the Services, whether during or after the Term.
24. General.
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24.1 Entire Agreement.
This Agreement and any other agreements the forms of which are attached hereto and when
executed by the Parties constitute the entire agreement between the Parties with respect to their
subject matter and shall not be modified or rescinded except by a writing signed by WG and Service
Provider. The Appendices and all Work Agreements (and the Exhibits thereto) are incorporated
herein by this reference. Except as set forth in Section 2.3, the provisions of this
Agreement and any other agreements the forms of which are attached hereto and when executed by the
Parties supersede all contemporaneous oral agreements and all prior oral and written quotations,
communications, agreements, understandings of the Parties, and written or oral representations of
either Party with respect to the subject matter of this Agreement, including any letter of intent
or memorandum of understanding executed by the Parties with respect to the Services; provided,
however, that with respect to the confidentiality agreement signed by the Parties on March 13,
2006, the Parties agree that any Confidential Information exchanged pursuant to such
confidentiality agreement will be subject to the terms of Article 15 of this Agreement.
There are no representations, understandings or agreements relating to this Agreement that are not
fully expressed in this Agreement and each of the Parties acknowledges that it has not relied on
any representation, promise, understanding or warranty (other than as fully expressed in this
Agreement) in entering into this Agreement.
24.2 Assignment.
This Agreement shall be binding on the Parties and their respective successors and permitted
assigns. Service Provider may not assign (whether by sale of all or substantially all of its
assets, sale of stock, merger or reorganization) this Agreement or any of its rights and
obligations under this Agreement without the prior written consent of WG. Any attempted assignment,
delegation, or subcontracting (other than pursuant to Section 12.5) in contravention of the
above provision shall be void and ineffective. Service Provider hereby acknowledges that WG is
entering into this Agreement based upon (i) its personal relationship with Service Provider and
(ii) the personal judgment, skills and abilities of Service Provider and the Personnel.
Notwithstanding the foregoing, Service Provider may assign its rights and obligations under this
Agreement, without the consent of WG, to an Affiliate of Service Provider provided that in the case
of such assignment, Service Provider remains fully liable for and is not relieved from the full
performance of its obligations under this Agreement, and Service Provider will provide WG prompt
written notice of the assignment. WG may not assign this Agreement or any of its rights and
obligations under this Agreement without the prior written consent of Service Provider; provided,
however, that WG may assign this Agreement, in whole or in part, to (x) an Affiliate or (y) to the
purchaser of WG (whether by sale of all or substantially all of its assets, sale of stock, merger
or reorganization) provided that in the case of such assignment, WG remains fully liable for and is
not relieved from the full performance of its obligations under this Agreement, and WG will provide
Service Provider prompt written notice of the assignment.
24.3 Notices.
Any notice required or permitted to be given under this Agreement shall, except as otherwise
provided in an Appendix or Work Agreement, be given in writing and shall be
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effective from the date sent by registered or certified mail, by hand, facsimile or overnight
courier to the addresses set forth below.
| To Service Provider: | Accenture, LLP | |||
| ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ | ||||
| ▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||||
| Attention: General Counsel | ||||
| Telephone: ▇▇▇-▇▇▇-▇▇▇▇ | ||||
| Fax: ▇▇▇-▇▇▇-▇▇▇▇ | ||||
| with a copy (which shall not constitute notice) sent to: |
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ One Freedom Square ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ |
|||
| Telephone: ▇▇▇-▇▇▇-▇▇▇▇ | ||||
| Fax: ▇▇▇-▇▇▇-▇▇▇▇ | ||||
| To WG: | ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | |||
| General Counsel | ||||
| Washington Gas | ||||
| ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇. | ||||
| ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||||
| Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ | ||||
| Fax: (▇▇▇) ▇▇▇-▇▇▇▇ | ||||
| ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ | ||||
| President & Chief Operating Officer | ||||
| Washington Gas | ||||
| ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ | ||||
| ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||||
| Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ | ||||
| Fax: (▇▇▇) ▇▇▇-▇▇▇▇ |
Either Party may change the address set forth in this Section at any time by giving prior written
notice to the other Party as provided above. Notwithstanding the foregoing, operational
notifications will be addressed to the Parties’ respective Responsible Executives.
24.4 Third Party Notice.
If either Party receives a notice of infringement, request for disclosure, subpoena, or other
inquiry with respect to any matter relating to this Agreement, such Party shall promptly notify the
other Party. To the extent any such request relates to the other Party’s Confidential Information,
Section 15.3 shall control. Neither Party shall respond to such notices, requests,
subpoenas, or inquiries, without first so notifying the other Party pursuant to this Section
24.4 unless such notice would be otherwise prohibited by Law.
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24.5 Expenses.
Except as otherwise expressly provided by this Agreement, each Party shall pay all fees and
expenses incurred by such Party in connection with the negotiation and execution of, and
performance under, this Agreement.
24.6 Relationship of the Parties.
Service Provider shall perform the Services as an independent contractor. Nothing in this
Agreement or in the performance of the Services by Service Provider shall be construed to create:
(i) a partnership, joint venture or other joint business arrangement between WG and Service
Provider; (ii) any fiduciary duty owed by one Party to the other Party or any of its Affiliates
(unless otherwise contemplated by a Work Agreement); (iii) a relationship of employer and employee
between the Parties; or (iv) any basis for any employee of a Party to claim that he or she is an
employee of the other Party. Service Provider and WG are not joint employers, a single employer,
associated employers or related employers for any purpose under this Agreement. Except as
expressly permitted by this Agreement, neither Party shall have the authority to commit the other
Party contractually or otherwise to any obligations to third parties.
24.7 Severability.
If any provision of this Agreement is determined to be invalid or unenforceable, the remaining
provisions of this Agreement shall not be affected thereby and shall be binding upon WG and Service
Provider and shall be enforceable and such provision shall be reformed to the extent necessary to
render such provision valid and enforceable and to reflect the intent of the Parties to the maximum
extent possible under applicable Law.
24.8 Consents and Approval.
Except as and to the extent otherwise expressly provided in such approval or consent, 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. Whenever this Agreement requires or contemplates any
action, permission, consent or approval, each Party will act reasonably and in good faith and will
not unreasonably withhold or delay such action, permission, consent or approval, unless this
Agreement expressly establishes some other standard, such as exercise of a Party’s sole discretion,
or the right to withhold any of the foregoing for any reason or no reason.
24.9 Waiver of Default.
The failure by either WG or Service Provider to insist upon strict performance of any of the
provisions contained in this Agreement shall not constitute a waiver of its rights, at law or in
equity, or a waiver of any other provisions or subsequent default by the other Party in the
performance or compliance with any of the terms and conditions set forth in this Agreement. No
waiver of any of the provisions of this Agreement or any Work Agreement will be effective unless it
is expressly stated to be a waiver and communicated to the other Party in writing.
73
24.10 Remedies Cumulative.
Unless expressly stated otherwise in this Agreement, all remedies provided for in this
Agreement will be cumulative and in addition to, and not in lieu of, any other remedies available
to either Party at law, in equity or otherwise.
24.11 Survival of License in Bankruptcy.
All licenses granted to WG under or pursuant to this Agreement are, and shall otherwise be
deemed to be, for purposes of Paragraph 365(n) of the U.S. Bankruptcy Code, licenses of rights to
“intellectual property” as defined under Paragraph 101(35A) of the U.S. Bankruptcy Code. The
Parties agree that WG, as a licensee of such rights under this Agreement, shall retain and may
fully exercise all of its rights and elections under the U.S. Bankruptcy Code, or similar laws of
other jurisdictions.
24.12 Survival of Obligations.
The obligations of the Parties under this Agreement that the Parties have expressly agreed
shall survive termination or expiration of this Agreement or a Work Agreement or that, by their
nature, would continue beyond the expiration or termination of this Agreement or a Work Agreement,
shall survive the expiration or termination of this Agreement or a Work Agreement for any reason.
Without limiting the generality of the foregoing, the Parties intend that the following Sections
survive expiration or termination of this Agreement or a Work Agreement: 1, 2.3, 5, 6, 7.3, 12.5.3,
15, 16, 17.1.3, 17.1.4, 17.2, 17.3, 17.5, 17.6, 17.7, 19, 20, 21.1, 21.3, 22.3, 22.4, 22.5, 23,
24.11 and 24.12, in addition to the following Appendices: 10 and 11. Upon the expiration or
termination of the applicable Work Agreement, any monies, penalties or other charges due and owing
either Party shall be paid by the other Party within thirty (30) days of the effective date of such
termination or expiration.
24.13 Media Releases.
All media releases, public announcements and public disclosures by either Party relating to
this Agreement or the subject matter of this Agreement, including internal and external promotional
or marketing materials (but not including announcements intended solely for internal distribution
or to meet legal or regulatory requirements beyond the reasonable control of the disclosing Party)
shall be coordinated with and approved in writing by the other Party prior to release. The Parties
also will use commercially reasonable efforts to mutually agree on the wording of a press release
within a reasonable period of time after the Execution Date; provided, however, no
such press release may be issued unless so agreed. Notwithstanding the above, during the first
year of the term of this Agreement, Service Provider shall obtain WG’s prior consent [***] to list
WG’s name and/or use WG’s corporate logo on a customer list that Service Provider provides to
prospective buyers of its products or services along with a general description, approved in
writing by WG in its sole discretion, of the types of Services Service Provider is performing for
WG. After the first year of the term of this Agreement,
[***]
INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE
24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.
74
Service Provider may use WG’s name, such logo and such products and services description in
the manner previously approved by WG without the need for WG to consent in each instance as long as
Service Provider [***].
24.14 Third Party Beneficiaries.
Except for the WG Indemnified Parties and Service Provider Indemnified Parties to the extent
provided in Article 19, this Agreement shall not be deemed to create any obligations of a Party to
any such third party or create any rights in third parties, including employees, suppliers, or
customers of a Party. No provision of this Agreement shall create any third party beneficiary
rights in any employee or former employee (including any beneficiary or dependent thereof) of WG in
respect of rights to continued employment of benefits of any kind. WG and Service Provider hereby
specifically acknowledge and agree that it is their intention, (i) that all of the terms and
conditions of this Agreement be made available to Affiliates of WG, and (ii) that Affiliates of WG
are not intended third party beneficiaries of this Agreement (other than to the extent a WG
Indemnified Party), but shall be entitled to enforce this Agreement as it pertains to any
applicable Work Agreement to which such Affiliate is a party and that WG be entitled to enforce
this Agreement or any applicable Work Agreement on behalf of such Affiliates.
24.15 Compliance with Export/Import Control Laws.
The Parties expressly acknowledge their obligation to comply with all applicable Laws relating
to their respective businesses, facilities, and the provision of services to third parties,
regarding (i) export from any country of Export/Import Items, (ii) import into any country of any
Export/Import Items, (iii) use in any country of any Export/Import Items and (iv) re-export from
any country of any Export/Import Items, as such Laws may be modified from time to time, in
connection with this Agreement. In their respective performance of the activities contemplated
under this Agreement, neither Party shall directly or indirectly export (or re-export) any
Export/Import Items, or permit the shipment of same: (x) into any country to which the United
States has embargoed goods; (y) to anyone on the U.S. Treasury Department’s List of Specially
Designated Nationals, List of Specially Designated Terrorists or List of Specially Designated
Narcotics Traffickers, or the U.S. Commerce Department’s Denied Parties List; or (z) to any country
or destination for which the United States government or a United States governmental agency
requires an export license or other approval for export without first having obtained such license
or other approval. Each Party acknowledges export control or economic sanctions programs may
include U.S. export control laws such as the Export Administration Regulations and the
International Traffic in Arms Regulations, and U.S. economic sanctions programs that are or may be
maintained by the U.S. Government, including sanctions currently imposed against Belarus, Burma
(Myanmar), Cuba, Iran, Ivory Coast, Liberia, North Korea, Sudan, Syria and Zimbabwe, as well as
Specially Designated Nationals and Blocked Persons programs. The Parties will review the impact of
obtaining approvals, consents, licenses and/or permits required for the export or import of any
Export/Import Items under this Agreement on Service Provider’s ability to provide the Services.
Prior to providing Service Provider any goods, software, services and/or technical data subject to
export controls controlled at a level other than EAR99/AT, WG
[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
75
shall provide written notice to Service Provider specifying the nature of the controls and any
relevant export control classification numbers. Each Party shall cooperate with the other and shall
provide to the other promptly upon request any end-user certificates and other documents and
technical information concerning any Export/Import Items as the other Party may require to obtain
such approvals, consents, licenses and/or permits.
24.16 Compliance with Foreign Corrupt Practices Act.
Neither Party nor any of its directors, officers, employees or owners will make any payment
(including any offer to pay, promise to pay or gift of money or anything else of value) in
connection with this Agreement or any Services provided pursuant to this Agreement to:
(i) any government official, any political party or official of a political
party, or any candidate for political office (in any country); or
(ii) any other person, while knowing, having reason to know or having
credible information suggesting in any way that all or a portion of such money or
thing of value will be offered, given or promised, directly or indirectly, to any
government official, to any political party, or official thereof or to any
candidate for political office (in any country), where the purpose of the payment
was or is to influence or induce any government official, political party,
official of a political party or candidate for political office: (A) to take any
act or make any decision in that person’s official capacity; (B) to fail to take
an act in violation of that person’s official duty; (C) affect or influence any
act or decision by a government; or (D) take or fail to take any other action
that would violate the laws or regulations of the United States of America or any
other country in order to assist a Party, or any of a Party’s directors,
officers, employees or owners, in obtaining or retaining business for or with, or
directing business to, any person. Service Provider represents and warrants that
none of the members of its board of directors, or any of its senior management
that are directly involved with this Agreement, is a government official, an
official of a political party, or a candidate for political office, in any
country outside of the United States, except as has been disclosed in writing to
WG. Service Provider represents that it has a program in place to monitor its
compliance with the Foreign Corrupt Practices Act and to determine whether any of
its directors, officers, employees or owners may be subject thereto. The term
“government official” means any officer or employee of a government or a
department, agency, or instrumentality thereof, or any such person acting in an
official capacity for or on behalf of such government or department, agency, or
instrumentality, in any country.
24.17 Solicitation.
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During the Term, and for a period of one (1) year following the expiration or termination of a
Work Agreement, neither party shall solicit any officer or employee of the other Party or its
Affiliates having performed under or in connection with such Work Agreement, without the prior
written consent of the other Party. General advertisements or publication of employment
77
opportunities by a Party that are not targeted at employees or officers of the other Party
shall not be deemed to violate a Party’s non-solicitation obligations.
24.18 Further Assurances.
Each of the Parties agrees that from time to time, at the request of the other Party and
without further consideration, it shall execute and deliver such other documents and take such
other actions as the other Party may reasonably request to consummate more effectively the
transactions contemplated by this Agreement.
24.19 Calculation of Days.
Unless otherwise noted in this Agreement, “days” refers to calendar days.
24.20 Headings and Appendices; Construction.
The table of contents of this Agreement and the headings used for the Articles and Sections in
this Agreement are for convenience and reference purposes only and shall in no way affect the
meaning or interpretation of this Agreement. The terms “Section,” “Paragraph,” “Clause,” “Article”
and “Provision” refer to sections in this Agreement, and its Appendices, Exhibits, Schedules,
Attachments and Annexes, respectively. The Parties have participated jointly in the negotiation
and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as if drafted jointly by the Parties and no presumption
or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any
of the provisions of this Agreement. Whenever the context may require, any pronoun shall include
the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and
“including” shall be deemed to be followed by the phrase “without limitation.” The word “will”
shall be construed to have the same meaning and effect as the word “shall,” and vice versa.
24.21 Counterparts.
This Agreement may be executed in several counterparts, all of which taken together shall
constitute one single agreement between the Parties.
24.22 Strategic Alliances.
Service Provider has alliance relationships with third party product and services vendors and
as part of such alliances, Service Provider is able to resell certain products and services and/or
may receive compensation from vendors in the form of fees or other benefits in connection with the
marketing, technical and other assistance provided by Service Provider. WG acknowledges that such
relationships may be beneficial to Service Provider and assist in its performance of the Services
hereunder. With respect to any sourcing projects Service Provider undertakes as part of Exhibit
C.1 of Work Agreement No. 1, Service Provider agrees that to the extent Service Provider
recommends third party products or services vendors from entities with which Service Provider has
alliance relationships as described in this Section 24.22, Service Provider will only
recommend such products or services to the extent they can be provided under
78
prices and terms comparable to or more favorable than those which WG can obtain from other
sources.
* * * * *
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IN WITNESS WHEREOF, each of the Parties hereto, by its duly authorized representative, has
caused this Agreement to be executed as of the Execution Date.
| WASHINGTON GAS LIGHT COMPANY | ACCENTURE LLP | |||||||||
By:
|
By: | |||||||||
Printed Name:
|
Printed Name: | |||||||||
Title:
|
Title: | |||||||||