Preview of our top selling Information Technology (IT) Services Agreement
IBM / TNPC - Information Technology Services Agreement
INFORMATION TECHNOLOGY SERVICES AGREEMENT
between
EMW ENERGY SERVICES CORP.
and
INTERNATIONAL BUSINESS MACHINES CORPORATION
Dated May 12, 2000
*** Confidential treatment has been requested for the portions of this
agreement marked by asterisks. Omitted material for which confidential
treatment has been requested has been filed separately with the
Securities and Exchange Commission.
TABLE OF CONTENTS
Page ARTICLE 1 DEFINITIONS AND CONSTRUCTION....................................................................1
1.01 DEFINITIONS.....................................................................................1
1.02 INCORPORATION AND REFERENCES...................................................................10
1.03 HEADINGS.......................................................................................11
1.04 INTERPRETATION OF DOCUMENTS....................................................................11
ARTICLE 2 TERM...........................................................................................11
2.01 INITIAL TERM...................................................................................11
2.02 RENEWAL AND EXTENSION..........................................................................11
ARTICLE 3 SERVICES, ETC..................................................................................11
3.01 DESIGNATED SERVICES............................................................................11
3.02 IMPROVED TECHNOLOGY............................................................................12
3.03 GOVERNMENTAL APPROVALS.........................................................................12
3.04 EXCLUSIVITY, INSOURCING AND RESOURCING.........................................................12
3.06 REPORTS........................................................................................13
ARTICLE 4 SI SERVICES AND START-UP SERVICES..............................................................13
4.01 START-UP SERVICES..............................................................................13
4.02 FULL FUNCTIONAL SERVICES.......................................................................14
4.03 SI SERVICES, GENERALLY.........................................................................15
4.04 STEADY STATE SERVICES..........................................................................15
ARTICLE 5 NEW SERVICES...................................................................................15
5.01 NEW SERVICES...................................................................................15
5.02 THIRD PARTY SERVICES...........................................................................16
ARTICLE 6 EMW RESPONSIBILITIES...........................................................................16
6.01 EMW CONTRACT EXECUTIVE.........................................................................16
6.02 USE OF EMW FACILITIES..........................................................................16
ARTICLE 7 SERVICE LEVELS.................................................................................17
7.01 DESIGNATED SERVICE LEVELS......................................................................17
7.02 NEW SERVICE LEVELS.............................................................................17
7.03 ADJUSTMENT OF SERVICE LEVELS...................................................................17
7.04 ROOT-CAUSE ANALYSIS............................................................................17
7.05 MEASUREMENT AND MONITORING TOOLS...............................................................18
7.08 SERVICE LEVEL CREDITS AND SERVICE LEVEL INCENTIVES.............................................18
IBM Confidential May 12, 2000 i
Agreement
ARTICLE 8 EMW SATISFACTION AND BENCHMARKING..............................................................13
8.01 INITIAL CUSTOMER SATISFACTION SURVEY...........................................................13
8.02 CUSTOMER SATISFACTION SURVEY...................................................................13
8.03 BENCHMARKING OVERVIEW..........................................................................19
8.04 BENCHMARKING PROCESS...........................................................................19
8.05 BENCHMARK RESULTS REVIEW PERIOD AND ADJUSTMENTS................................................20
ARTICLE 9 SERVICE LOCATIONS..............................................................................20
9.01 SERVICE LOCATIONS..............................................................................20
9.02 SAFETY AND SECURITY PROCEDURES.................................................................21
9.03 DATA SECURITY..................................................................................21
9.04 SECURITY RELATING TO COMPETITORS...............................................................21
ARTICLE 10 IBM STAFF......................................................................................21
10.01 IBM CONTRACT EXECUTIVE.........................................................................21
10.02 KEY PERSONNEL..................................................................................21
10.03 PROJECT STAFF..................................................................................22
10.04 SUBCONTRACTORS.................................................................................22
10.05 CONDUCT OF IBM PERSONNEL.......................................................................23
10.06 NON-COMPETITION................................................................................23
ARTICLE 11 MANAGEMENT AND CONTROL.........................................................................23
11.01 CHANGE CONTROL PROCEDURES......................................................................23
11.02 PROCEDURES MANUAL..............................................................................24
11.03 CHANGE CONTROL PROCEDURES......................................................................24
ARTICLE 12 PROPRIETARY RIGHTS.............................................................................24
12.01 IBM SOFTWARE, TOOLS AND APIS...................................................................24
12.02 DEVELOPED DATA.................................................................................26
ARTICLE 13 DATA...........................................................................................26
13.01 OWNERSHIP OF EMW DATA..........................................................................26
13.03 RETURN OF DATA.................................................................................26
ARTICLE 14 CONSENTS.......................................................................................27
ARTICLE 15 CONTINUED PROVISION OF SERVICES................................................................27
15.01 BACKUP AND REDUNDANCY PLAN.....................................................................27
15.02 FORCE MAJEURE..................................................................................27
15.03 ALTERNATE SOURCE...............................................................................27
15.04 ALLOCATION OF RESOURCES........................................................................28
ARTICLE 16 PAYMENTS AND INVOICING.........................................................................28
16.01 DESIGNATED FEES................................................................................28
16.02 INVOICES FOR CERTAIN DESIGNATED FEES...........................................................28
16.04 TIME OF PAYMENT................................................................................28
IBM Confidential May 12, 2000 Page ii of 52 EMW Confidential Agreement
16.05 DETAILED INVOICES..............................................................................28
16.06 FEE DISPUTE....................................................................................28
16.07 ADJUSTMENTS TO FEES............................................................................29
16.08 EXPENSES.......................................................................................29
16.09 CRITICAL MILESTONES............................................................................29
16.10 PAYMENTS BY IBM................................................................................30
ARTICLE 17 TAXES..........................................................................................30
ARTICLE 18 AUDITS.........................................................................................31
18.01 AUDIT RIGHTS...................................................................................31
18.02 RECORD RETENTION...............................................................................32
ARTICLE 19 CONFIDENTIALITY................................................................................32
19.01 GENERAL OBLIGATIONS............................................................................32
19.02 EXCLUSIONS.....................................................................................33
19.03 RESIDUAL INFORMATION...........................................................................33
19.04 UNAUTHORIZED ACTS..............................................................................34
ARTICLE 20 REPRESENTATIONS AND WARRANTIES.................................................................34
20.01 BY EMW.........................................................................................34
20.02 BY IBM.........................................................................................35
20.03 DISCLAIMER.....................................................................................36
ARTICLE 21 ADDITIONAL COVENANTS...........................................................................36
21.01 BY EMW.........................................................................................36
21.02 BY IBM.........................................................................................36
ARTICLE 22 DISPUTE RESOLUTION.............................................................................38
22.01 OVERVIEW.......................................................................................38
22.02 CONTINUITY OF PERFORMANCE......................................................................39
22.03 EXPEDITED DISPUTE RESOLUTION...................................................................39
ARTICLE 23 TERMINATION....................................................................................39
23.01 TERMINATION FOR CONVENIENCE....................................................................39
23.02 TERMINATION FOR CHANGE IN CONTROL OF IBM.......................................................39
23.03 TERMINATION FOR CAUSE..........................................................................39
23.04 TERMINATION FOR FAILURE TO PROVIDE SERVICES....................................................40
23.05 OTHER TERMINATIONS.............................................................................40
ARTICLE 24 TERMINATION FEES...............................................................................40
24.01 CALCULATION OF TERMINATION FEES................................................................40
24.02 PARTIAL TERMINATION FEE ADJUSTMENT.............................................................40
24.03 TERMINATION FEES...............................................................................40
IBM Confidential May 12, 2000 Page iii of 52 EMW Confidential Agreement
ARTICLE 25 TERMINATION ASSISTANCE.........................................................................40
25.01 TERMINATION ASSISTANCE SERVICES................................................................40
25.02 EXIT RIGHTS....................................................................................41
ARTICLE 26 INDEMNITIES....................................................................................42
26.01 INDEMNITY BY EMW...............................................................................42
26.02 INDEMNITY BY IBM...............................................................................43
26.03 INDEMNIFICATION PROCEDURES.....................................................................43
ARTICLE 27 DAMAGES........................................................................................44
27.01 DIRECT DAMAGES.................................................................................44
27.02 CONSEQUENTIAL DAMAGES..........................................................................45
27.03 EXCLUSIONS.....................................................................................45
27.04 INJUNCTIVE RELIEF..............................................................................45
ARTICLE 28 INSURANCE......................................................................................46
28.01 INSURANCE......................................................................................46
28.02 INSURANCE DOCUMENTATION........................................................................46
28.03 RISK OF LOSS...................................................................................46
ARTICLE 29 MISCELLANEOUS PROVISIONS.......................................................................46
29.01 ASSIGNMENT.....................................................................................46
29.02 NOTICES........................................................................................47
29.03 COUNTERPARTS...................................................................................49
29.04 RELATIONSHIP...................................................................................49
29.05 CONSENTS, APPROVALS AND REQUESTS...............................................................49
29.06 SEVERABILITY...................................................................................49
29.07 WAIVERS........................................................................................49
29.08 REMEDIES CUMULATIVE............................................................................49
29.09 ENTIRE AGREEMENT...............................................................................49
29.10 AMENDMENTS.....................................................................................49
29.11 SURVIVAL.......................................................................................49
29.12 THIRD PARTY BENEFICIARIES......................................................................50
29.13 GOVERNING LAW..................................................................................50
29.14 SOLE AND EXCLUSIVE VENUE.......................................................................50
29.15 COVENANT OF FURTHER ASSURANCES.................................................................50
29.16 NEGOTIATED TERMS...............................................................................50
29.17 EXPORT.........................................................................................51
29.18 CONFLICT OF INTEREST...........................................................................51
29.19 PUBLICITY......................................................................................51
IBM Confidential May 12, 2000 Page iv of 52 EMW Confidential Agreement
TABLE OF EXHIBITS
Exhibit 1 Statement of Work Exhibit 2 Specified Software and License Terms Exhibit 3 Designated IBM Service Locations Exhibit 4 Fees, CPI Adjustments and Termination Fees Exhibit 5 Service Levels Exhibit 6 Operational Planning Process Exhibit 7 IBM Key Personnel Exhibit 8 Change Control Procedures
IBM Confidential May 12, 2000 Page v of 52 EMW Confidential Agreement
This INFORMATION TECHNOLOGY SERVICES AGREEMENT, dated May 12, 2000, is between EMW ENERGY SERVICES CORP. ("EMW") and INTERNATIONAL BUSINESS MACHINES CORPORATION ("IBM").
W I T N E S S E T H:
WHEREAS, EMW and IBM have entered into Letter Agreements dated February 25, 2000 and April 13, 2000 (the "INTERIM AGREEMENTS") setting forth the preliminary terms and conditions applicable to the system to be developed by IBM for customer acquisition, customer care, customer management and revenue management services with respect to EMW's current or prospective residential or small commercial retail energy consumers;
WHEREAS, EMW and IBM have engaged in extensive negotiations and discussions that have culminated in the formation of the definitive relationship described in this Agreement; and
WHEREAS, IBM desires to provide to EMW, and EMW desires to obtain from IBM, the services described in this Agreement on the terms and conditions set forth in this Agreement.
NOW, THEREFORE, for and in consideration of the agreements set forth below, EMW and IBM agree as follows:
ARTICLE 1 DEFINITIONS AND CONSTRUCTION
1.01 DEFINITIONS. The following defined terms used in this Agreement shall have the meanings specified below:
"ACQUIRED CUSTOMER" shall have the meaning set forth in
SECTION 3.05.
"ADDITIONAL DESIGNATED IBM SERVICE LOCATION(S)" shall mean any
location other than a Designated IBM Service Location from which IBM or
IBM Agents provide the Services.
"AGREEMENT" shall mean this Information Technology Services
Agreement by and between EMW and IBM, as amended by the Parties from
time to time.
"API" shall mean Application Program Interfaces.
"AUDIT" shall have the meaning set forth in SECTION 18.01.
"BENCHMARK PROCESS" means the objective measurement and
comparison process (using baselines and industry standards) consistent
with this Agreement and mutually agreed upon by EMW and IBM.
IBM Confidential May 12, 2000 Page 1 of 52 EMW Confidential Agreement
"BENCHMARK RESULTS" means the Benchmarker's written report of
the results of the Benchmark Process, including any appropriate
supporting documentation.
"BENCHMARK REVIEW PERIOD" means the 30 day period following
EMW's and IBM's receipt of the Benchmark Results during which EMW and
IBM will review such Benchmark Results.
"BENCHMARKER" means the firm or individual EMW and IBM jointly
select to conduct the Benchmark Process as set forth in SECTION 8.03.
"CHANGE(S)" shall mean any change to the Services, the
Software used to provide the Services or the Machines used to provide
the Services that would have a material adverse effect on EMW's
business operations or the cost to EMW of the Services.
"CHANGE CONTROL PROCEDURES" shall mean the procedures set
forth in EXHIBIT 8.
"CHANGE IN CONTROL" shall mean the (1) consolidation or merger
of a Party with or into any entity, (2) sale, transfer or other
disposition of all or substantially all of the assets of a Party or (3)
acquisition by any entity, or group of entities acting in concert, of
beneficial ownership of 50 percent or more of the outstanding voting
securities of a Party, or (4) sale, transfer or other disposition of
all or substantially all of the assets of IBM Global Services; provided
however, that a Change in Control shall not include transactions with
affiliates.
"COMMENCEMENT DATE" shall mean the date the day after the
completion of the Start-up Services.
"COMPARATORS" shall have the meaning set forth in SECTION
8.04.
"CONFIDENTIALITY AGREEMENT" shall mean (1) any valid and
binding written confidentiality or non-disclosure agreement or (2)
other agreement containing valid and binding provisions regarding
confidentiality.
"CONFIDENTIAL INFORMATION" shall mean (1) the terms of this
Agreement and (2) information provided by the Discloser to the
Recipient that:
a. is marked confidential;
b. if disclosed orally or not marked confidential, is identified
prior to disclosure as Confidential Information or is
confirmed as Confidential Information in a signed writing
promptly thereafter; or
c. contains the Discloser's customer lists, customer information,
account information, pricing, information regarding business
planning and business operations, and administrative,
financial, or marketing activities, whether disclosed orally
or in writing; provided the Discloser treats such information
as confidential.
IBM Confidential May 12, 2000 Page 2 of 52 EMW Confidential Agreement
"CONSENTS" shall mean all licenses, consents, authorizations
and approvals that are necessary to allow IBM and IBM Agents to (1) use
any IBM Software and Tools, (2) use any assets owned or leased by IBM,
(3) use any third party services retained by IBM to provide the
Services during the Term and the Termination Assistance Period, (4)
transfer to EMW the IBM Third Party Software after the expiration or
termination of this Agreement, or (5) assign to EMW the rights IBM and
or IBM Agents assign to EMW pursuant to this Agreement.
"CONTRACT EXECUTIVES" shall mean the IBM Contract Executive
and the EMW Contract Executive.
"CONTRACT YEAR" shall mean each 12-month period commencing, in
the case of the first Contract Year, on the Effective Date and
thereafter upon the completion of the immediately preceding Contract
Year.
"CRITICAL SERVICES" shall have the meaning set forth in
Exhibit 5.
"CUSTOMER SATISFACTION SURVEY" shall have the meaning set
forth in SECTION 8.02.
"DATA SAFEGUARDS" shall have the meaning set forth in SECTION
9.03.
"DEFAULT CURE PERIOD" shall have the meaning set forth in
SECTION 23.03.
"DEFAULT NOTICE" shall have the meaning set forth in SECTION
23.03.
"DEFENSE" shall have the meaning set forth in SECTION 26.03.
"DESIGNATED FEES" shall mean the the SI Services Fees and the
Steady State Fees set forth in EXHIBIT 4.
"DESIGNATED SERVICE LEVELS" shall mean the service levels and
standards for the performance of the Designated Services as described
in EXHIBIT 5.
"DESIGNATED IBM SERVICE LOCATION(S)" shall mean the IBM
service locations set forth in EXHIBIT 3.
"DESIGNATED SERVICES" shall have the meaning set forth in
SECTION 3.01.
"DEVELOPED DATA" shall mean the following "outputs" produced
by the Services:
- -------------------------------------- ----------------------------------------- CATEGORY "OUTPUTS" - -------------------------------------- ----------------------------------------- Revenue Management Customer Data
Fulfillment Data; Usage History and
Clearinghouse Data - -------------------------------------- -----------------------------------------
IBM Confidential May 12, 2000 Page 3 of 52 EMW Confidential Agreement
- -------------------------------------- ----------------------------------------- Customer Acquisition / Care Scripts; Enrollment Data; Service Level
Data and Customer Satisfaction Data - -------------------------------------- ----------------------------------------- Business Intelligence Marketing Data; Product Sales Data;
Campaign Data and Data Analysis - -------------------------------------- ----------------------------------------- Knowledge Management Automated Response Data, FAQs and Data
Analysis - -------------------------------------- ----------------------------------------- Revenue Management and Customer All data in master customer database Acquisition / Care - -------------------------------------- -----------------------------------------
Defined terms used in this definition of "Developed Data" shall have the meanings specified below:
"Customer Data" shall mean data relating to account, premise, services provided, rate plan and billing information at the customer level.
"Fulfillment Data" shall mean data relating to the linkage with the fulfillment provider for non-commodity products and the linkage with the commodity distribution partners.
"Usage History Data" shall mean data relating to tracking usage by period to support usage trending and forecasting, which provides the basis for rebilling and high bill analysis.
"Clearinghouse Data" shall mean data relating to the linkage with market participants, including the status of service enrollment, turn on / turn off, and revenue settlement.
"Scripts" shall mean the customer service representative customer contact scripts.
"Enrollment Data" shall mean the data relating to and establishing the customer relationship, including marketing channel, campaign information and product and/or service information.
"Service Level Data" shall mean the data relating to measurements of Service Level performance, including call arrival rates, call patterning and pickup rate information.
"Customer Satisfaction Data" shall mean the data relating to and/or comprised of various forms of surveys and feedback loops to measure customer satisfaction.
IBM Confidential May 12, 2000 Page 4 of 52 EMW Confidential Agreement
"Marketing Data" shall mean the data relating to and/or comprised of target market information, segmentation and response measurement for market analysis.
"Product Sales Data" shall mean data relating to what products and services are being sold and who is buying them.
"Campaign Data" shall mean data relating to campaigns, media, and other measurements to analysis campaign effectiveness.
"Automated Response Data" shall mean data relating to and/or comprised of e-mail questions and inquiries received from customers and potential customers.
"FAQ" shall mean data relating to and/or comprised of questions submitted via the internet by EMW's customers and the corresponding answers provided by EMW.
"Data Analysis" shall mean data which is the combination of all of the information warehouse data to create the central data mart.
- --------------------------------------------------------------------------------
"DISCLOSER" shall mean any party that discloses Confidential
Information.
"DISPUTE RESOLUTION PROCESS" shall have the meaning set forth
in SECTION 22.01.
"EFFECTIVE DATE" shall mean May 12, 2000.
"EMW THIRD PARTY PRODUCTS" shall have the meaning set forth
SECTION 21.01.
"EMW AGENTS" shall mean the agents, contractors,
subcontractors and representatives of EMW, other than IBM and IBM
Agents.
"EMW COMPETITOR" shall mean any entity that is, or that the
applicable IBM employee(s) has knowledge intends to become, an
unregulated energy service provider of electricity and natural gas to
residential and small commercial customers in the domestic United
States. For purposes of the foregoing, "applicable IBM employee(s)"
means (a) for purposes of SECTION 4.03, the IBM employee(s) referring
to or accessing or controlling the ability of others to refer to or
access, the applicable written information, files or documentation
described therein and (b) for purposes of Section 10.06, the IBM Key
Personnel, the members of the Project Staff described in Section
10.06(2) and the IBM employees responsible for assigning such Key
Personnel and members of the Project Staff.
"EMW CONTRACT EXECUTIVE" shall have the meaning set forth in
SECTION 6.01.
IBM Confidential May 12, 2000 Page 5 of 52 EMW Confidential Agreement
"EMW DATA" shall mean all Developed Data and all data (1)
submitted to IBM or IBM Agents by or on behalf of EMW or (2) obtained,
or produced by IBM or IBM Agents in performance of the Services
(excluding IBM Data to the extent contained therein), including, with
respect to (1) and (2) above, data relating to EMW's: customers,
employees, technology, operations, facilities, consumer markets,
products, capacities, systems, procedures, security practices,
research, development, business affairs and finances, ideas, concepts,
innovations, inventions, designs, business methodologies, improvements,
trade secrets, copyrightable subject matter, patents and other
intellectual property and proprietary information.
"END DATE" shall have the meaning set forth in the definition
of Termination Assistance Period.
"END-USERS" shall mean users of the Services, as specified by
EMW.
"ENERGY CONSUMERS" shall have the meaning set forth in SECTION
7.06.
"EXTENSION PERIOD" shall have the meaning set forth in SECTION
2.02.
"FEES" shall mean the Designated Fees, all fees in connection
with New Services, and any other amounts specified as payable by EMW to
IBM pursuant to this Agreement.
"FIXED FEES" shall have the meaning set forth in EXHIBIT 4.
"FORCE MAJEURE EVENT" shall have the meaning set forth in
SECTION 15.02.
"FULL FUNCTIONAL SCHEDULE" shall mean the schedule for the
implementation of the Full Functional Services, as agreed by the
Parties prior to the commencement of the Steady State Services.
"FULL FUNCTIONAL SERVICES" shall have the meaning set forth in
EXHIBIT 1.A.
"GOVERNMENTAL APPROVAL(S)" shall mean any license, consent,
permit, approval or authorization of any person or entity, or any
notice to any person or entity, the granting of which is required by
applicable law, rule or regulation, including Regulatory Requirements,
for the consummation of the transactions contemplated by this
Agreement.
"IBM AGENTS" shall mean the agents, contractors,
subcontractors and representatives of IBM.
"IBM DATA" shall mean all data submitted to EMW or EMW Agents
by or on behalf of IBM under this Agreement and relating to IBM's:
customers, employees, technology, operations, facilities, consumer
markets, products, capabilities, systems, procedures, security
practices, research, development, business affairs and finances, ideas,
concepts, innovations, inventions, designs, business methodologies,
improvements, trade secrets, copyrightable subject matter, patents and
other intellectual property and proprietary information.
IBM Confidential May 12, 2000 Page 6 of 52 EMW Confidential Agreement
"IBM CONTRACT EXECUTIVE" shall have the meaning set forth in
SECTION 10.01.
"IBM KEY PERSONNEL" shall mean the IBM Contract Executive and
such other individuals specified in EXHIBIT 7, collectively, and their
replacements.
"IBM MACHINES" shall mean those Machines leased or owned by
IBM and IBM Agents that are used by IBM and IBM Agents to provide the
Services.
"IBM PROPRIETARY SOFTWARE" shall mean the Software owned or
developed by or on behalf of IBM that is used in connection with the
Services.
"IBM PROPRIETARY TOOLS" shall mean the Tools owned or
developed by or on behalf of IBM that is used in connection with the
Services.
"IBM SERVICE LOCATION" shall mean, collectively, the
Designated IBM Service Locations and the Additional Designated IBM
Service Locations.
"IBM SOFTWARE" shall mean the IBM Proprietary Software and the
IBM Third Party Software, collectively.
"IBM THIRD PARTY SOFTWARE" shall mean the Software licensed or
leased by IBM from a third party that is used in connection with the
Services.
"IBM THIRD PARTY TOOLS" shall mean the Tools licensed or
leased by IBM from a third party that is used in connection with the
Services.
"IBM TOOLS" shall mean the IBM Proprietary Tools and the IBM
Third Party Tools, collectively.
"IMPROVED TECHNOLOGY" shall mean any new developments in
Software and Machines that could reasonably be expected to have an
impact on EMW's business, to the extent known and made available within
or by IBM.
"INITIAL AGREEMENT EXPIRATION DATE" shall mean May 11, 2010.
"INITIAL CUSTOMER SATISFACTION SURVEY" shall have the meaning
set forth in SECTION 8.01.
"INITIAL TERM" shall have the meaning set forth in SECTION
2.01.
"INTERIM AGREEMENTS" shall have the meaning set forth in the
first recital.
"LOSSES" shall mean any and all damages, fines, penalties,
deficiencies, losses, liabilities (inc...
View agreement details