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SERVICES AND SECONDMENT AGREEMENT

Employee Secondment Agreement

SERVICES AND SECONDMENT AGREEMENT | Document Parties: CHENIERE ENERGY PARTNERS, L.P. | Sabine Pass LNG, L.P You are currently viewing:
This Employee Secondment Agreement involves

CHENIERE ENERGY PARTNERS, L.P. | Sabine Pass LNG, L.P

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Title: SERVICES AND SECONDMENT AGREEMENT
Governing Law: Texas     Date: 3/26/2007
Industry: Chemical Manufacturing     Sector: Basic Materials

SERVICES AND SECONDMENT AGREEMENT, Parties: cheniere energy partners  l.p. , sabine pass lng  l.p
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Exhibit 10.2

SERVICES AND SECONDMENT AGREEMENT

This Services and Secondment Agreement (“Agreement”), dated as of March 26, 2007 (the “Effective Date”), is entered into between CHENIERE LNG O&M SERVICES, L.P. (“O&M”), a Delaware limited partnership, and CHENIERE ENERGY PARTNERS GP, LLC (“MLP GP”), a Delaware limited liability company. O&M and MLP GP are hereinafter each referred to as a “Party” and collectively referred to as the “Parties.”

RECITALS:

WHEREAS, Sabine Pass LNG, L.P., a Delaware limited partnership (“Sabine Pass LNG”), is developing a liquefied natural gas receiving terminal in Cameron Parish, Louisiana (the “Project”);

WHEREAS, O&M and Sabine Pass LNG are parties to an Operation and Maintenance Agreement dated as of February 25, 2005 (the “O&M Agreement”) with respect to the operation and maintenance of the Project;

WHEREAS, as of March 26, 2007, O&M assigned to MLP GP and MLP GP assumed from O&M all of O&M’s obligations under the O&M Agreement;

WHEREAS, O&M will provide to MLP GP the operational and maintenance resources and services necessary for MLP GP to meet its obligations under the O&M Agreement;

WHEREAS, in connection with the provision of the operational and maintenance resources and services under this Agreement, O&M desires to second, or cause its Affiliate to second, to MLP GP certain personnel employed by O&M or its Affiliates in connection with the Project.

NOW THEREFORE, in consideration of the premises and the mutual covenants and agreements contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, O&M and MLP GP hereby agree as follows:

ARTICLE 1

DEFINITIONS; INTERPRETATION; USE OF SECONDING AFFILIATES

 

1.1

Definitions .

As used in this Agreement, (a) the terms defined in this Agreement will have the meanings so specified, and (b) capitalized terms not defined in this Agreement will have the meanings ascribed to those terms on Exhibit A to this Agreement.

 

1.2

Interpretation .

In this Agreement, unless a clear contrary intention appears: (a) the singular includes the plural and vice versa; (b) reference to any Person includes such Person’s successors and assigns but, in the case of any Party, only if such successors and assigns are permitted by this Agreement, and reference to a Person in a particular capacity excludes such Person in any other capacity; (c) reference to any gender includes each other gender; (d) reference to any agreement (including this Agreement), document or instrument means such agreement, document or instrument as amended or modified and in effect from time to time in accordance with the terms thereof and, if applicable, the terms of this Agreement; (e) reference to any Section means such Section of this Agreement, and references in any Section or definition to any clause means such clause of such Section or definition; (f) “hereunder,” “hereof,” “hereto” and words of similar import will be deemed references to this Agreement as a whole and not to any particular Section or other provision hereof or thereof; (g) “including” (and with correlative meaning “include”) means including without limiting the generality of any description preceding such term; and (h) relative to the determination of any period of time, “from” means “from and including,” “to” means “to but excluding” and “through” means “through and including.”

 


1.3

Legal Representation of Parties .

This Agreement was negotiated by the Parties with the benefit of legal representation, and any rule of construction or interpretation requiring this Agreement to be construed or interpreted against any Party merely because such Party drafted all or a part of such Agreement will not apply to any construction or interpretation hereof or thereof.

 

1.4

Titles and Headings .

Section titles and headings in this Agreement are inserted for convenience of reference only and are not intended to be a part of, or to affect the meaning or interpretation of, this Agreement.

ARTICLE 2

OPERATIONAL AND MAINTENANCE SERVICES

 

2.1

Operational and Maintenance Services .

O&M shall second, or cause its applicable seconding Affiliate to second, the Provided Personnel to MLP GP to provide the Services.

 

2.2

Fees and Expenses .

Each month, MLP GP will pay to O&M, within a reasonable time following receipt thereof, all payments that MLP GP receives from Sabine Pass LNG pursuant to Articles VIII and IX of the O&M Agreement less any costs incurred by MLP GP in hiring personnel provided by a third party to provide Services pursuant to Section 3.6 hereof.

 

2.2

Suspension of Services .

In the event MLP GP fails to meet its payment obligations under Section 2.2 hereof for any reason other than a good faith Dispute and such failure continues for 30 days after MLP GP’s receipt of written notice of such failure, O&M may suspend the performance of its obligations under Section 2.1 hereof until such time as MLP GP cures such failure.

ARTICLE 3

SECONDMENT

 

3.1

Provided Personnel .

Subject to the terms of this Agreement, O&M agrees to second to MLP GP, and MLP GP agrees to accept the Secondment of, those certain specifically identified individuals listed in Exhibit B (the “Provided Personnel Schedule”) for the purpose of performing job functions related to the Project. The Provided Personnel will be temporary employees of MLP GP during the Period of Secondment and shall, at all times during the Period of Secondment, work under the direction, supervision and control of MLP GP. Provided Personnel shall have no authority or apparent authority to act on behalf of O&M during the Period of Secondment. The Provided Personnel Schedule sets forth the names of the Provided Personnel seconded by O&M, the job functions of the Provided Personnel, and the starting and ending dates for the Period of Secondment of the Provided Personnel. Individuals may be added or removed from the Provided Personnel Schedule from time to time by the execution by the Parties of a completed “Addition/Removal/Change of Responsibility of Provided Personnel” form, the form of which shall be similar to the form attached to this Agreement as Exhibit C , which will be fully binding on the Parties for all purposes under this Agreement. Those rights and obligations of the Parties under this Agreement that relate to individuals that were on the Provided Personnel Schedule but then later removed from the Provided Personnel Schedule, which rights and obligations accrued before the removal of such individual, will survive the removal of such individual from the Provided Personnel Schedule to the extent necessary to enforce such rights and obligations.

 

2


3.2

Period of Secondment .

O&M will second, or cause its applicable seconding Affiliate to second, to MLP GP such Provided Personnel on the start date set forth on the Provided Personnel Schedule and continuing, during the period (and only during the period) that the Provided Personnel are performing Services for MLP GP, until the earlier of:

(a) the end of the term of this Agreement;

(b) the end date set forth for the Provided Personnel on the Provided Personnel Schedule (or another end date for such Provided Personnel as mutually agreed in writing by the Parties) (the “End Date”);

(c) a withdrawal, departure, resignation or termination of such Provided Personnel under Section 3.3 ; or

(d) a termination of Secondment of such Provided Personnel under Section 3.4 .

The period of time that any Provided Personnel is provided by O&M to MLP GP is referred to in this Agreement as the “Period of Secondment.” At the end of the Period of Secondment for any Provided Personnel, such Provided Personnel will no longer be subject to the direction by MLP GP of the Provided Personnel’s day-to-day activities. The Parties acknowledge that certain of the Provided Personnel may also provide services to Cheniere Energy, Inc. and its Affiliates in connection with their respective operations, including other services provided to MLP GP and its Affiliates (“Shared Provided Personnel”), and the Parties intend that such Shared Provided Personnel shall only be seconded to MLP GP during those times that the Shared Provided Personnel are performing Services for MLP GP hereunder.

 

3.3

Withdrawal, Departure or Resignation .

O&M will use reasonable efforts to prevent any early withdrawal, departure or resignation of any Provided Personnel prior to the End Date for such Provided Personnel’s Period of Secondment. If any Provided Personnel tenders his resignation to O&M as its employee, O&M will promptly notify MLP GP. During the Period of Secondment of any Provided Personnel, O&M will not voluntarily withdraw or terminate any Provided Personnel except with the written consent of MLP GP (which may be through the execution of a completed “Addition/Removal/Change of Responsibility of Provided Personnel” form, which shall be similar to the form set forth on Exhibit C hereto), such consent not to be unreasonably withheld. O&M will indemnify, defend and hold harmless MLP GP, its directors, officers and employees against all Losses arising out of or in any way connected with or related to the termination of employment of the Provided Personnel by O&M EVEN THOUGH SUCH LOSS MAY BE CAUSED BY THE NEGLIGENCE OF ONE OR MORE OF MLP GP AND ITS DIRECTORS, OFFICERS AND EMPLOYEES, except to the extent that such Losses arise out of or result from the sole negligence, gross negligence or willful misconduct of any of MLP GP or its directors, officers or employees. Upon the termination of employment, the Provided Personnel will cease performing Services for MLP GP.

 

3.4

Termination of Secondment .

MLP GP will have the right to terminate the Secondment to MLP GP of any Provided Personnel for any reason at any time. Upon the termination of any Provided Personnel’s Period of Secondment, O&M will be solely liable for any costs or expenses associated with the termination of the Secondment, except as otherwise specifically set forth in this Agreement. O&M will indemnify, defend and hold harmless MLP GP, its directors, officers and employees against all Losses arising out of or in any way connected with the termination of Secondment of the Provided Personnel by O&M EVEN THOUGH SUCH LOSS MAY BE CAUSED BY THE NEGLIGENCE OF ONE OR MORE OF MLP GP AND ITS DIRECTORS, OFFICERS AND EMPLOYEES, except to the extent that such Losses arise out of or result from the sole negligence, gross negligence or willful misconduct of any of MLP GP or its directors, officers or employees. Upon the termination of a Secondment, the Provided Personnel will cease performing Services for MLP GP.

 

3


3.5

Supervision .

During the Period of Secondment, MLP GP shall:

(a) be ultimately and fully responsible for the daily work assignments of the Provided Personnel (and with respect to Shared Provided Personnel, during those times that the Shared Provided Personnel are performing Services for MLP GP hereunder), including supervision of their the day-to-day work activities and performance consistent with the purposes stated in Section 3.1 and the job functions set forth in the Provided Personnel Schedule;

(b) set the hours of work and the holidays and vacation schedules (other than with respect to Shared Provided Personnel, as to which MLP GP and O&M shall jointly determine) for Provided Personnel; and

(c) have the right to determine training which will be received by the Provided Personnel.

In the course and scope of performing any Provided Personnel job functions, the Provided Personnel will be integrated into the organization of MLP GP, will report into MLP GP’s management structure, and will be under the direct management and supervision of MLP GP employees or Provided Personnel designated by MLP GP to be responsible for the supervisory functions set forth in this Section 3.5 on behalf of MLP GP.

 

3.6

Provided Personnel Qualifications; Approval .

O&M will provide such suitably qualified and experienced Provided Personnel as O&M is able to make available to MLP GP, and MLP GP will have the right to approve such Provided Personnel. In the event that O&M is unable to provide suitably qualified and experienced personnel, MLP GP may hire personnel provided by a third party to provide Services.

ARTICLE 4

TERM

The term of this Agreement will commence on the Effective Date and, unless sooner terminated as provided herein, will continue for the Initial Term and each Extension Term of the O&M Agreement until the O&M Agreement is terminated pursuant to the terms thereof. MLP GP shall have the right to terminate this Agreement for convenience by giving O&M 30 days’ prior written notice of such termination.

ARTICLE 5

INDEMNIFICATION

 

5.1

Loss or Damage to the Facility .

O&M shall be responsible for any physical loss or damage to the Facility resulting from O&M’s gross negligence or willful misconduct in the course of the performance of its obligations under this Agreement, in an amount not to exceed the greater of (i) the applicable deductible under MLP GP’s or its Affiliates’ physical damage insurance policies that covers such loss or damage or (ii) $400,000 for any such loss or damage caused during a given calendar year.

 

5.2

O&M Indemnity .

O&M SHALL DEFEND , INDEMNIFY AND HOLD HARMLESS THE MLP GP G ROUP FROM AND AGAINST ALL DAMAGES , LOSSES , COSTS AND EXPENSES ( INCLUDING ALL REASONABLE ATTORNEYS FEES , AND LITIGATION OR ARBITRATION EXPENSES ) ARISING OUT OF OR RESULTING FROM OR RELATED TO ( I INJURY TO OR DEATH OF ANY MEMBER OF THE O&M G ROUP OR ( II DAMAGE TO OR DESTRUCTION OF PROPERTY OF ANY MEMBER OF THE O&M G ROUP OCCURRING IN CONNECTION WITH THE SERVICES , REGARDLESS OF THE CAUSE OF SUCH INJURY , DEATH , PHYSICAL DAMAGE OR DESTRUCTION , INCLUDING THE SOLE OR JOINT NEGLIGENCE , BREACH OF CONTRACT OR OTHER BASIS OF LIABILITY OF ANY MEMBER OF THE MLP GP G ROUP .

 

4


O&M shall indemnify, defend, and hold harmless the MLP GP Group against any and all losses of whatever kind and nature, including all related costs and expenses incurred in connection therewith, in respect of personal injury to or death of third parties and in respect of loss of or damage to any third party property to the extent that the same arises out of:

(a) any breach by O&M of its obligations hereunder;

(b) any negligent act or omission on the part of O&M; and

(c) any gross negligence or willful misconduct of O&M.

Any indemnification payable by O&M to MLP GP hereunder shall be net of any insurance proceeds received by MLP GP under MLP GP’s, O&M’s or any of their respective Affiliates’ insurance policies with respect to the circumstances giving rise to O&M’s indemnification of MLP GP hereunder, and shall be subject to the limitation set forth in Section 6.1 .

 

5.3

MLP GP Indemnity .

MLP GP SHALL DEFEND , INDEMNIFY AND HOLD HARMLESS THE O&M G ROUP FROM AND AGAINST ALL DAMAGES , LOSSES , COSTS AND EXPENSES ( INCLUDING ALL REASONABLE ATTORNEYS FEES , AND LITIGATION OR ARBITRATION EXPENSES ) ARISING OUT OF OR RESULTING FROM OR RELATED TO ( I INJURY TO OR DEATH OF ANY MEMBER OF THE MLP GP G ROUP OR ( II DAMAGE TO OR DESTRUCTION OF PROPERTY OF MLP GP G ROUP ( EXCLUDING THE FACILITY ) OCCURRING IN CONNECTION WITH THE SERVICES , REGARDLESS OF THE CAUSE OF SUCH INJURY , DEATH , PHYSICAL DAMAGE OR DESTRUCTION , INCLUDING THE SOLE OR JOINT NEGLIGENCE , BREACH OF CONTRACT OR OTHER BASIS OF LIABILITY OF ANY MEMBER OF THE O&M G ROUP .

MLP GP shall indemnify, defend, and hold harmless O&M against any and all claims for Losses of whatever kind and nature, including all related costs and expenses incurred in connection therewith, in respect of personal injury to or death of third parties and in respect of loss of or damage to any third party property to the extent that the same arises out of:

(a) any breach by MLP GP of its obligations hereunder;

(b) any negligent act or omission on the part of MLP GP; and

(c) any gross negligence or willful misconduct of MLP GP.

Any indemnification payable by MLP GP to O&M hereunder shall be net of any insurance proceeds received by O&M under O&M’s, MLP GP’s or any of their respective Affiliates’ insurance policies with respect to the circumstances giving rise to MLP GP’s indemnification of O&M hereunder.

 

5.4

Other Indemnity Rules .

If any Losses arise, directly or indirectly, in whole or in part, out of the joint or concurrent negligence of both Parties, each Party’s liability therefor shall be limited to such Party’s proportionate degree of fault. Payments required to be paid by O&M to MLP GP under this Article 5 shall not constitute an Operating Expense or otherwise be reimbursable to O&M from MLP GP, and shall be subject to the limitation set forth in Section 6.1 .

ARTICLE 6

LIMITATION OF LIABILITY

 

6.1

Limitation of Liability .

The aggregate amount of damages, compensation, or other such liabilities (other than with respect to the indem


 
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