Exhibit 10.4
OUTSOURCING SERVICES AGREEMENT
by and between
BOISE CASCADE, L.L.C.,
and
BOISE PAPER HOLDINGS,
L.L.C.
February 22, 2008
Outsourcing Services Agreement
This Outsourcing Services Agreement is
made and entered into, as of February 22, 2008 (the “
Execution Date ”), by and between Boise Cascade, LLC,
a Delaware limited liability company (“ Boise
Cascade ”), and Boise Paper Holdings, L.L.C., a Delaware
limited liability company (“ Boise Paper ”),
(each, a “ Party ,” and collectively, the
“ Parties ”).
WHEREAS, pursuant
to that certain Purchase and Sale Agreement, by and among Boise
Cascade and certain of its Affiliates and Aldabra 2 Acquisition
Corp. (“ Aldabra ”) and certain of its
Affiliates, dated September 7, 2007 (as the same has been and
may be amended, modified, supplemented or waived from time to time,
the “ Purchase Agreement ”), Boise Cascade is
selling its paper, packaging and newsprint and transportation
businesses and most of its corporate staff operations to Boise
Paper by means of (i) a contribution and transfer of
(x) the stock of its paper, newsprint and packaging and
transportation subsidiaries and (y) certain additional assets
and personnel involved in its paper, newsprint and packaging, and
transportation businesses and its staff operations to Boise Paper
and (ii) a sale of the entire equity interest in Boise Paper
to a wholly owned subsidiary of Aldabra; and
WHEREAS, Boise
Cascade and Boise Paper have agreed in the Purchase Agreement to
cause the parties and their Affiliates to provide corporate staff
services to each other on the terms and conditions set forth in
this Agreement.
NOW, THEREFORE ,
the Parties agree as follows.
1.
Defined Terms.
All definitions
contained in Appendix 1 shall apply throughout this Agreement and
each appendix, schedule, exhibit, and other attachment made a part
hereof and any Statement of Work entered into pursuant hereto
unless, in respect of a Statement of Work, its terms provide a
different definition of a term to be used solely in respect of that
Statement of Work.
2.
Services; Statements of Work.
The Services to be
provided by the parties to each other shall be as set forth in the
Statements of Work provided for below
2.1.
Statements of Work.
2.1.1.
Initial Statements of
Work. Concurrently with the execution of this
Agreement, the Parties are entering into Statements of Work which
describe certain corporate staff Services to be provided during the
term of this Agreement, copies of which are attached as Appendix
2. Each Statement of Work identifies one Party as a Service
Provider and the other Party as a Services Recipient in respect of
the Services to be provided pursuant to such Statement of Work,
describes the Services to be provided thereunder, and the
compensation to be paid therefor, and certain additional
information called for in this Agreement.
2.1.2.
Subsequent Statements of
Work.
The Parties may, but shall not be required to, from time to time
during the term hereof, enter into one or more additional
Statements of Work that provide for the provision by one Party to
the other of additional Services not provided for in any other
Statement of Work then in effect. Any subsequent Statement of
Work shall be substantially in the form of the Statements of Work
attached as Appendix 2 and shall be signed by an authorized
representative of each Party. Each Statement of Work shall
become effective on the date specified in the Statement
of
Work and continue in effect until the
expiration date specified in the Statement of Work, but not longer
than the then remaining term of this Agreement.
2.2.
Services to and by Affiliates . Services to be
provided hereunder shall be provided to the Party designated in the
Statement of Work as the Services Recipient and to all of its
Affiliates unless the Statement of Work provides a narrower
definition of Services Recipient. A Service Provider may
provide Services hereunder directly or through one or more of its
Affiliates and provision of Services by an Affiliate of a Service
Provider shall satisfy the obligations of the Service Provider
hereunder; provided that, if a Service Provider elects to
have Services provided hereunder through one or more of its
Affiliates, the Service Provider shall remain as fully liable for
the provision of such Services as though it had provided them
directly.
2.3.
Order of Precedence . In the event of any
conflict between the terms of this Agreement and a Statement of
Work, the terms of this Agreement shall control unless the
Statement of Work contains a provision expressly identifying any
provision of this Agreement which the parties intend to be
superseded by the terms of such Statement of Work, expressing their
intent to so modify such provision for purposes of such Statement
of Work, setting out the scope of the modification, and
acknowledging that such modification is limited in its effect
solely to the Statement of Work in which it is contained. In
such event the Statement of Work shall be signed by the
Relationship Manager of each Party.
2.4.
Services Inclusive . The descriptions of Services
contained in the Statements of Work are intended by the parties to
be descriptive and not exhaustive. To this end, the Services
provided pursuant to this Agreement shall include performance of:
(i) the functions and activities specifically described in the
relevant Statement of Work; (ii) all ancillary functions and
activities related thereto that, even though not specifically
identified in the relevant statement of Work, were being performed
by Boise Cascade’s relevant staff function in connection with
the Services more particularly described in the Statement of Work
prior to the Execution Date; and (iii) additional Services
relating to the Services described in such Statement of Work that
become necessary for the Service Provider to ensure that it
delivers the relevant service in compliance with Law or that become
necessary to the Services Recipient to ensure that it carries out
the business functions affected by such Service in compliance with
Law, including in each case any new or changed Laws applicable to
the activities involved.
2.5.
Absolute Obligation . Subject to Sections
22.5 , and 25.2 hereof, a Service Provider’s
obligation to provide the Services required by this Agreement shall
be absolute and unconditional and Service Provider may not suspend
provision of the Services in the event of a Dispute (including a
dispute over payment).
3.
Term of the Agreement
. Subject to the provisions of any Section hereof
permitting early termination of this Agreement, the “
Initial Term ” of this Agreement shall commence as of
the Execution Date and end on the third anniversary of the
Execution Date. Thereafter. this Agreement shall continue for
successive renewal terms of one year each (each such one-year term,
a “ Renewal Term ”) beginning on the date of the
expiration of the Initial Term or the immediately preceding Renewal
Term and concluding on the first anniversary of the expiration of
such Initial Term or Renewal Term, unless either party shall have
given written notice of non-renewal to the other Party not less
than 364 days prior to the end of the Initial Term or the Renewal
Term then in effect. When used herein, the “
Term ” of this Agreement shall be the Initial Term and
each Renewal Term; provided that the “ Term
” of this Agreement shall terminate on any earlier
termination of this Agreement in accordance with its terms.
No expiration or termination of the Term shall release any party
from liability for breach of this Agreement arising prior to such
expiration or termination. Absent a provision to the contrary
in any Statement of Work, and subject to the provisions of any
Section hereof permitting early termination of this Agreement
or any
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Statement of Work, the
term of each Statement of Work shall commence on the date of its
execution by the parties and end on the termination of this
Agreement.
4.
Service Provider’s Commitments
4.1.
Personnel and Facilities. Except as otherwise expressly
provided in this Agreement or a Statement of Work, Service Provider
shall be responsible during the Term for providing all facilities,
personnel, and other resources necessary for Service
Provider’s provision of the Services, and all costs and
expenses associated therewith. If provision of any Services
to Services Recipient at the level and quality required hereby
while simultaneously providing the same or similar Services to the
Service Provider’s own operations requires an expansion of
Service Provider’s staff providing such Service, Service
Provider shall promptly engage such additional Personnel as may be
necessary to satisfy its and Services Recipient’s combined
requirements. Each Party shall make all capital investments
in equipment or other assets necessary to deliver or utilize
Services provided for hereby or as may be necessary to maintain the
quality of the Services in accordance with the Performance
Requirements. All such capital expenditures shall be made at
Service Provider’s sole expense and all equipment and other
assets with respect to which such capital expenditures are made
shall be owned exclusively by the Service Provider notwithstanding
any provision herein for recovery of all or any portion of the
Service Provider’s depreciation expense in respect of such
equipment from Services Recipient; provided that if a
capital expenditure is required solely to respond to a request for
specific incremental services by a Services Recipient, such
expenditure shall be made by the Services Recipient and the
equipment or other asset with respect to which such capital
expenditures are made shall be exclusively owned by Services
Recipient, but Service Provider shall operate such capital item as
necessary to provide services hereunder.
4.2.
Improvements and New Technology. If requested by Services
Recipient, or where it is essential to continuation of provision of
a Service on a cost effective and efficient basis, Service Provider
shall make available to Services Recipient all of the updates,
modifications and improvements to the Services that Service
Provider provides to its own business units and operations for
Services that are the same as or substantially similar to the
Services. Where necessary for continued use and enjoyment of
a service by the Services Recipient, Service Provider shall also
provide and deliver to Services Recipient all updates,
modifications and improvements to Documentation, Software,
processes, materials, and technology on a basis that is no less
favorable than the updates, modifications and improvements to the
foregoing that Service Provider provides to its own business units
and operations.
5.
Volume of Services and Changes
5.1
Volume of Services . Unless any Statement of Work
provides otherwise, the volume of Service to be provided for any
particular Service, shall be Services Recipient’s full
requirements for such Service and the Service Provider shall make,
on a timely basis, such additions to its staff and equipment
necessary to meet such requirements, in combination with its own
requirements for Services provided by the same staff and
equipment. In the event that a Services Recipient foresees a
need for a material increase or decrease in any Service provided
hereunder, it shall give the Service Provider reasonable notice of
the scope and timing of such prospective change in Service level,
and the Service Provider shall take reasonable steps to
appropriately adjust its capacity to deliver such Service,
including addition or reduction of staff, addition of equipment,
etc. Additional costs incurred for any expansion of Service
shall be allocated between the parties pursuant to Section 10
hereof and any relevant provision of the specific Statement of Work
covering such Service.
5.2
Changes in Scope . Changes in scope of any particular
Service to be provided hereunder (other than changes in the volume
of any particular service) shall be effected as follows:
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5.2.1 Changes in Legal
Requirements . Where a change in the scope of any
Service is necessitated by a change in any statute, regulation, or
other legally enforceable requirement or any change in accounting
rules applicable to the Services Recipient, the Service
Provider shall provide the additional Services necessitated by such
change on the same basis as a change in volume pursuant to
Section 5.1 hereof.
5.2.2 Changes in
Business Requirements . Where a change in the
scope of any Service is necessitated by a change in the business
requirements of the Services Recipient, including a decision to
enter a new line of business, or to change its administrative
procedures, and the additional Services required thereby are ones
that can be accommodated by the Service Provider’s existing
staff function (with or without the addition of personnel thereto)
without addition of a wholly new staff function, such additional
Service requirement shall be treated the same as a change in
Service level under Section 5.1. However, where the
required additional Services cannot be so accommodated, they may be
added to this Agreement only by execution of a new Statement of
Work on terms and conditions reasonably satisfactory to each Party;
provided that neither Party shall be obligated to enter into
any such new Statement of Work. By way of example and without
limiting the foregoing, an expansion of scope which would be
governed by the same rules as Section 5.1 would be a
change in a Services Recipient’s financial reporting
requirements necessitated by a new credit agreement and an example
of a change in scope of Services which would not be governed by the
same rules as Section 5.1 would be the acquisition by the
Services Recipient of a foreign subsidiary that requires
preparation of financial reports in accordance with generally
accepted accounting principles of a jurisdiction other than the
United States.
6.
Record Keeping
6.1
General. Service Provider shall maintain records which
shall include complete and accurate records of any invoices and
supporting documentation for all amounts billable to, and payments
made by, Services Recipient under this Agreement. Service
Provider shall provide to Services Recipient or its designee
documentation and other information relating to each invoice as may
be reasonably requested by Services Recipient to verify that the
Charges on such invoice are accurate, complete, and valid in
accordance with this Agreement.
6.2
Compliance with Purchase Agreement . Section 8S
of the Purchase Agreement shall apply to all records relating to
Services Recipient created after the Closing Date pursuant to the
Services supplied under this Agreement. The termination or
earlier expiration of this Agreement shall not affect the
obligations of a Party pursuant to Section 8S of the Purchase
Agreement in respect of records created before the Execution Date
or records created pursuant to this Agreement after the Execution
Date.
7.
Information Security Requirements. Each Party shall,
with respect to the other Party’s Confidential Information,
comply with the most stringent of the information security and
privacy policies (i) in effect at Boise Cascade immediately
prior to the Execution Date; (ii) required by Law; or
(iii) utilized by the Party in possession of such Confidential
Information from time to time. In addition, in the event of
any breach of the foregoing which results in the release of
material Confidential Information of a Party to third parties not
controlled by the releasing Party or to the general public, the
Party responsible for such breach shall promptly notify the other
Party as soon as it becomes aware of any such breach, violation or
incident.
8.
Service Performance
8.1.
Performance of Services—General Standard. Absent a
provision to the contrary in any Statement of Work, Service
Provider shall provide each Service (i) in a professional,
workmanlike manner, (ii) in accordance with generally accepted
industry standards and (iii) with a standard of care that
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is no less than the
greater of a standard of care (a) that was observed prior to
the Execution Date in providing such Service to Services Recipient,
and (b) that Service Provider observes in providing such
Service (or a substantially similar Service) to its own business
units and operations, and (iv) in accordance with any specific
performance requirements set forth in the applicable Statement of
Work.
8.2
Reperformance. Services Recipient may require Service
Provider to correct or re-perform any defective or nonconforming
Services at Service Provider’s sole expense when such
re-performance is reasonably necessary and practical under the
circumstances, as reasonably determined by Services
Recipient. Services Recipient may also require Service
Provider to take appropriate and reasonable steps to ensure that
future performance of the Services will be in accordance with the
requirements of this Agreement and the applicable Statements of
Work. Service Provider shall undertake any remedial action
required by this Section 8.2 at no additional charge to
Services Recipient.
8.3
No Preferential Treatment. Service Provider shall not
favor its own business units and operations over those of Services
Recipient (including in the level of service, staffing priorities,
allocation of Personnel, training and expertise of Personnel,
capital expenditures, allocation of work between internal staff and
third party service providers and allocation of available resources
upon the occurrence of a Force Majeure Event) when providing to its
own business units and operations Services that are the same as, or
substantially similar to, any Services provided hereunder or which
are provided to both Parties by the same Personnel.
9.
Business Continuity and Disaster Recovery Plan. Any
Service Provider providing data processing Services shall maintain
a disaster and business continuity plan in respect of its data
processing operations that provides a level of protection and
service restoration capability in respect of Services provided to
Services Recipient that is not less than that provided by Boise
Cascade’s similar plans in effect as of immediately prior to
the Effective Date .
10.
Charges.
10.1.
Direct Fully Allocated Costs. Unless provided to the
contrary in a Statement of Work, the Services Recipient shall pay
the Service Provider for the Services provided it under each
Statement of Work an amount equal to the Service Provider’s
Direct Fully Allocated Cost of providing such Services.
When used herein, “ Direct Fully Allocated Cost
” shall mean an allocable share of all direct costs incurred
by Service Provider in the delivery of such Services including
(i) fully loaded wage costs of personnel providing the
Services including salary, payroll taxes, benefit costs, incentive
compensation costs and other like costs customarily included in
fully loaded employment costs; (ii) depreciation expense on
equipment or other assets used in the provision of such Services;
(iii) building rent for portions of the building in use for
the delivery of such Services; (iv) out-of-pocket expenses
reimbursed to or incurred on account of staff employees providing
such Services including travel and entertainment and professional
training; (v) payments to third parties for Services utilized
in the operation of any staff function providing Services
hereunder, excluding third party expense covered by
Section 10.5 or for the provision by Service Provider of
Services solely to itself; and (vi) portions of the cost of
other staff functions of Service Provider customarily allocated to
the staff function providing a Service, but without duplication of
costs already allocated to Services Recipient by such other staff
functions.
Notwithstanding
the foregoing, the “ Direct Fully Allocated Cost
” of any Service shall not include any of Service
Provider’s general overhead not specifically attributable to
a staff function providing Services hereunder, including
(a) wage and salary costs for senior executives not providing
direct and immediate management of a Service providing staff
function; (b) any portion of Service Provider’s cost of
debt or equity financing; (c) any amount accrued, paid, or
received as state federal or
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local income tax or
franchise tax expense or benefit; and (d) indirect costs of
any staff function not customarily allocated by Service Provider to
its other staff functions.
Direct Fully Allocated Costs of each staff
function providing Services shall be estimated during the first six
months and the last six months of each calendar year on the basis
of such staff function’s annual budgeted costs of operations
for the first six months and its budget update for the last six
months, in each case, as prepared in connection with such staff
functions normal business operations. At the end of each six
month period, amounts billed and paid on the basis of such budgeted
costs shall be trued up to actual costs incurred during such
period.
10.2
Allocations .
Allocations of the costs to be included in Direct Fully Allocated
Costs shall, be made (i) on the basis of the percentage of
staff time allocated to the provision of Services to a Services
Recipient in each staff function providing Services, with such
percentage to be reasonably determined and reported monthly by the
Service Provider; (ii) on the basis of units of performance
specified in the Statement of Work measured and reported monthly by
the Service Provider; or (iii) on such other basis as may be
specified in the relevant Statement of Work. For the
avoidance of doubt, unless the options referred to in clause
(ii) or (iii) of this Section 10.2 are specifically
selected for particular Service in a Statement of Work, costs shall
be allocated as provided in clause (i) of this
Section 10.2.
10.3
Third Party Expenses. To the extent that a Service
Provider retains third parties to assist it in the provision of
Services to a Services Recipient and such Services are retained to
augment the level of Services which can be provided by its own
staff, such third party costs shall be included in its allocation
of its direct costs of providing such Services and allocated
between the parties in accordance with clause (v) of
Section 10.1 and included in charges in accordance with
Section 10.2. Where such third party Services are
specifically requested by the Services Recipient or obtained by the
Service Provider because it lacks the relevant expertise on its own
staff to provide such Service and does not have a need for such
Services itself, such Services shall not be included in the costs
and cost allocation provided for above and Services Recipient shall
be required to reimburse expenses incurred by Service Provider for
such third party Services. The cost of any such Services
shall be billed and paid along with each monthly billing for
estimated Direct Fully Allocated Cost of other Services.
10.4
Tax Obligations .
Service Provider shall bill to Services Recipient and
Services Recipient shall pay to Service Provider all sales and use
taxes applicable to Services provided hereunder. Service
Provider shall remit such sales and use taxes to applicable taxing
authorities and make all tax filings required thereby. All
other Taxes shall be borne by the Party incurring same and not
included in any allocation of costs hereunder.
11.
Invoicing and Payment
11.1.
Invoicing and Payment
11.1.1.
Payment Period
. Service Provider shall invoice
Services Recipient in arrears on or before the 15th day of each
month for the Estimated Fully Allocated Direct Costs and any third
party services incurred and paid by Service Provider which are
required by Section 10.3 to be reimbursed separately from the
cost allocation for such month. Payment of each such invoice
shall be due by the 25th of such month.
11.1.2.
Late
Payment . If Services Recipient does not pay
undisputed amounts due to Service Provider within ten
(10) days after such payment became due and payable, Service
Provider may give Services Recipient notice in writing of late
payment. In the event that such notice is given,
Services
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Recipient shall pay
Service Provider a late fee calculated at a rate per annum that is
three percentage points above the Prime Rate from date the relevant
payment was due to the date of payment.
11.2
Record Keeping; Invoice Audits. Each Service Provider
shall maintain accurate records of the amounts billed to Services
Recipient and the basis for such billings, including records of the
costs incurred and included in such bills and the allocation of
such costs in accordance with this Agreement. At any time
during the Term hereof (but not more frequently than once every six
months) and for a period of one year after the termination hereof,
Services Recipient or its designee may review and audit such
records in respect of any Statement of Work. Service Provider
shall cooperate in any audit of such records that Services
Recipient may undertake. In the event any such audit uncovers
an overcharge of Services Recipient, then Service Provider shall
reimburse Services Recipient for the amount of the overcharge and,
if the overcharge is more than 10% of the aggregate Charges for the
period audited, interest on the amount of the overcharge calculated
at a rate per annum that is three percentage points above the Prime
Rate from the date paid until the date repaid. If such audit
reveals an undercharge, Services Recipient shall pay the amount of
such undercharge at the time of payment of the next monthly payment
of charges. The cost of any such audit shall be borne by the
Services Recipient unless such audit reveals an overcharge of more
than 15% of the aggregate Charges for the period audited, in which
case such audit costs shall be reimbursed by the Service
Provider.
11.3.
Disputed Charges. Services Recipient shall pay all
undisputed Charges when they become due in accordance with this
Agreement. If Services Recipient, in good faith, disputes any
Charges regarding the Services, it shall promptly notify Service
Provider and the Parties shall address such Dispute through the
Dispute Resolution Process. With respect to those portions
not in Dispute, Services Recipient shall pay such invoice in
accordance with the time period associated with the invoice.
11.4.
Invoice and Remittance
Addresses . Service Provider shall send a
unified invoice covering all Statements of Work to the attention of
the Controller of the Services Recipient at the principal offices
of the Services Recipient together with such supporting information
as may be reasonably requested by the Services Recipient.
Services Recipient shall remit all payments due Service Provider
under this Agreement in United States Dollars by wire transfer or
other electronic method of immediately available funds to a
domestic bank account designated by Service Provider by the 25th of
each month, or if such day is a day on which banks are not
regularly scheduled to be open for business in the united States,
the last working day prior to such date. Service Provider may
change such payment account from time to time by written notice to
Services Recipient.
12.
Service Provider’s Personnel
12.1.
Personnel
12.1.1.
Qualified Personnel
. Service Provider shall provide its
Personnel with suitable training, education, skill and other
qualifications to perform the Services under each specific
Statement of Work, and Service Provider shall be responsible for
any and all acts or omissions of the Personnel..
12.1.2.
Termination
. Except as otherwise set forth in
this Agreement, neither Party shall be liable to the other Party
(or to any third party, including any Personnel) for any
termination of the employment or engagement of any of the other
Party’s Personnel, or costs arising therefrom, in connection
with this Agreement or the provision of the Services.
12.1.3.
Replacement at the Request of
Services Recipient . Service Provider shall, in good faith,
consider reasonable requests from Services Recipient with respect
to the hiring, transfer, or removal for cause of any of Service
Providers Personnel providing the Services, solely with respect to
the
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provision of such Services to Services
Recipient; provided that any hiring or termination decision
(whether for cause or without cause) shall be at the sole
discretion of the Service Provider.
12.1.4.
Compliance with On-Site
Policies . When the Personnel of a Party are on the
other Party’s premises, they shall comply with all applicable
rules, regulations and policies applicable to other contractors at
such premises, including such matters as on-site working hours,
holidays and such Party’s physical security and safety
policies. If requested, each Party shall use reasonable
efforts to provide the other Party with written copies of such
rules, regulations and policies to the extent that such rules,
regulations, and policies are provided to third party contractors
on such premises. Each Party may, in its sole discretion,
approve all Personnel requiring access to any of its facilities or
sites.
12.1.5.
Compliance with
Agreement. The Parties will ensure
that its Personnel providing or receiving the Services comply with
the applicable terms of this Agreement and the Statements of Work
(including the terms in Articles 7 and 14
).
12.1.6.
Background Checks
. Service Provider
shall conduct background checks for Personnel hired or engaged
after the Execution Date that have access to or
responsibility for Services Recipient’s cash, money, bank
accounts, investment accounts or other financial
assets.
12.1.7.
Statements of Work
. Statements of Work
may specify additional Personnel requirements, including
requirements to use Personnel with specified training, skills or
education for specified tasks.
12.2.
Solicitation. Notwithstanding Section 8R of
the Purchase Agreement, Services Recipient shall have the right to
solicit or hire any Personnel of Service Provider engaged in the
provision of Services who has been terminated by Service Provider,
and to solicit any such personnel of Service Provider to whom
Service Provider has given notice of termination, provided
that any rehiring of any such Personnel by Services Recipient shall
occur no earlier than the termination date specified in such notice
of termination.
12.3.
Non-Employment. Service Provider’s Personnel are
not Services Recipient’s employees or agents, and Service
Provider shall be fully responsible for their acts, regardless of
whether such Personnel are acting within the scope of their
employment or agency. Service Provider shall be solely
responsible for the payment of compensation of the Personnel, and
Service Provider shall inform Personnel that they are not entitled
to any of Services Recipient’s employee benefits or to
participate in any of its compensation plans. Service
Provider, and not Services Recipient, 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.
Service Provider shall, upon request of the services Recipient
cause its Personnel providing services hereunder to affirm they are
not employees of Services Recipient for any purpose and that they
shall not exercise any right or seek any benefit accruing to the
regular employees of Services Recipient.
13.
Relationship and Statement of Work Management
13.1.
Relationship Managers Each Party hereby appoints the
individuals designated below to act as its initial Relationship
Manager:
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Boise
Paper
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Rob McNutt
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Boise
Cascade:
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Tom Carlile
|
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Each Party
represents and warrants that its Relationship Manager shall have
overall control of his or her Party’s performance under this
Agreement and shall have approval authority for all operational
matters relating to this Agreement. The Relationship Managers
shall meet as requested by either Party (i) to review
performance, (ii) to coordinate provision of the Services,
(iii) to discuss the Party’s future Service requirements
and service delivery capacity, and (iv) to participate in the
Dispute Resolution Process. Either Party may change its
Relationship Manager at any time and from time to time upon written
notice to the other.
13.2.
Responsible Managers. Each Party shall designate, for
each of the applicable Statements of Work, a Responsible Manager to
act as its initial point of contact for each such Statement of
Work. The Responsible Managers shall have responsibilities
for the implementation of the applicable Statement of Work
comparable to the responsibilities of the Relationship Managers for
this Agreement generally. Either Party may change its
Responsible Manager for an applicable Statement of Work upon
written notice to the other Party’s Responsible Manager for
such Statement of Work and such other Party’s Relationship
Manager. In the event that a Party does not designate a
Responsible Manager in any Statement of Work, then the Responsible
Manager for such Party for such Statement of Work shall be such
Party’s Relationship Manager.
13.3.
Responsibility for Subcontractors and Third Party
Suppliers. With respect to any obligations of Service
Provider under this Agreement that is being performed by
subcontractors, Service Provider shall remain responsible for the
discharge of such obligations in accordance with this Agreement and
shall also be responsible for the subcontractor’s 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 third party supplier agreement with Service Provider any of
Services Recipient’s Confidential Information unless and
until such subcontractor, vendor or supplier has a need to know
such Confidential Information for purposes of performance of
Services to Services Recipient and has agreed in writing (with
Services Recipient as an intended third party beneficiary of any
such agreement executed after the Execution Date) to protect the
confidentiality of such information in a manner that is equivalent
to that required of Service Provider by Article 14
.
13.4.
Failure to Act. Services Recipient’s failure to act
or fulfill an obligation set forth in this Agreement or an
applicable Statement of Work, including failure to give any
consents, notices or approvals, shall not constitute breach of this
Agreement or such Statement of Work (other than Services
Recipient’s failure to comply with its payment obligations
and disputed amounts requirements set forth in this Agreement), but
shall excuse Service Provider’s non-performance with respect
to the particular Service for which consent, notice or approval was
sought, but solely to the extent such failure to act or
non-performance prevents Service Provider from fulfilling its
obligations hereunder with respect to such Service for which
consent, notice or approval was sought.
14.
Confidentiality
14.1.
Confidential Information
. Each Party acknowledges that it may possess or, in the
course of providing or receiving the Services under this Agreement,
be exposed to, or acquire, Confidential Information of the other
Party or its Affiliates or their clients or third parties to whom
such other Party or its Affiliates owe a duty of confidentiality
(all of which, for purposes of this Agreement, shall be deemed
Confidential Information of the other Party). Each Party
shall hold the other Party’s Confidential Information in
strictest confidence using the same or greater degree of care it
uses with its own comparable Confidential Information (but in no
event less than a reasonable degree of care) and shall not copy,
reproduce, sell, assign, license, market, transfer or otherwise
dispose of, give or disclose such
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Confidential
Information to third parties or to use such information for any
purposes whatsoever other than as may be necessary for the
performance of this Agreement.
14.2.
Confidentiality Agreements. Each Party shall advise all of its
Personnel who have access, or may be exposed, to the other
Party’s Confidential Information of their obligations to keep
such information confidential in accordance with this
Article 14 . A Party shall only provide access to
the other Party’s Confidential Information to those Personnel
who have a need to know or to have access to such information in
order to provide or receive the Services.
14.3.
Permitted Disclosures. If either Party is requested to
disclose all or any part of any Confidential Information 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, the Party
subject to such request shall, to the extent practicable and
subject to applicable Laws, give prompt written notice of such
request to the other Party and shall give such other Party 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, and the Party subject to such request to disclose shall
cooperate with the other Party in such efforts. The Party
seeking such confidentiality agreement, protective order or
modification of disclosure shall reimburse the other Party for
reasonable legal fees and expenses incurred in its effort to comply
with this provision.
14.4.
Exclusions. Except as otherwise inherent in the
definition of Personal Data, “Confidential Information”
shall not include information if and to the extent Service Provider
can demonstrate such information: (i) is or becomes
known to the public other than by disclosure by Service Provider in
violation of this Agreement; (ii) was known to Service
Provider previously, without a duty of confidentiality (but, for
greater certainty, specifically excluding from this clause
(ii) any Confidential Information known to Personnel of Boise
Paper due to their prior employment by Boise Cascade);
(iii) was independently developed by Service Provider outside
of this Agreement and without reference to or use of any
Confidential Information of Services Recipient; or (iv) was
rightfully obtained by Service Provider from third parties without
a duty of confidentiality.
14.5.
Data Protection. In the event Service Provider shall have
access to any Personal Data of Services Recipient, the Service
Provider shall observe, in addition to the confidentiality
obligations set forth above, any further or more restrictive
obligations imposed by law on Service Provider or Services
Recipient with respect to safekeeping and limitations on use and
disclosure of such data.
14.6.
Remedy. It is understood and agreed that in the event
of a breach of this Article 14 , damages may not be an
adequate remedy and, notwithstanding the dispute resolution
provisions of Article 23 , the non-breaching Party
shall be entitled to seek injunctive relief to restrain any such
breach, threatened or actual without posting of bond or other
security or proof of irreparable harm.
14.7.
Attorney-Client Privilege/Work
Product . Service Provider acknowledges that
certain Data, documents, and databases to which Service Provider
may have access or that are prepared by Service Provider for
Services Recipient, and all associated communications relating
thereto, may be subject to the attorney-client privilege and/or
work product 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 Services Recipient. 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 Services Recipient may be subject to attorney-client
privilege and/or work product privilege, Service Provider shall
reasonably cooperate with Services Recipient to take steps to
prevent waiver of any privilege with respect thereto.
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14.8.
No Right or License. Nothing in this
Article 14 shall be construed as obligating Services
Recipient to disclose its Confidential Information to Service
Provider, or as granting to, or conferring on, Service Provider,
expressly or impliedly, any rights or license to the Confidential
Information.
15.
Services Recipient’s Data
15.1.
General . Notwithstanding any other provision of this
Agreement, Service Provider shall make all of Services
Recipient’s Data (complete and unaltered) available to
Services Recipient and its authorized agents (including auditors,
counsel, appraisers, financiers, and other professionals providing
services to Services Recipient) in the form in which Service
Provider maintains such Data. Service Provider shall also
provide such Data to Services Recipient in the form requested by
Services Recipient, and Service Provider may charge Services
Recipient for the actual cost (including labor costs) to provide
such media on which Service Provider provides such Data to Services
Recipient, but without duplication of Charges payable pursuant to
Section 10 hereof for provision of such Data.
15.2.
Safeguarding Services Recipient’s Data. Service
Provider shall establish and maintain safeguards against the
destruction, loss, misuse or alteration of Services
Recipient’s Data in the possession of Service Provider that
are no less rigorous than those set forth in Article 7
and Article 14 and as otherwise required by applicable
Data Protection Laws. Nothing herein shall limit the right of
Services Recipient to establish separate backup security for such
Data and to keep backup data and data files.
15.3.
Ownership and Use of Services Recipient’s Data. As
between the Parties, Services Recipient’s Data shall be and
remain the property of Services Recipient. Service Provider
shall use such 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 such Data or
any part thereof to any other person, and Service Provider shall
not commercially exploit any part of such Data. Service
Provider shall not possess or assert any property interest in, or
any lien or other right against or to, any of Services
Recipient’s Data nor shall Service Provider permit the lien
of any of its secured lenders to attach to any of Services
Recipient’s Data.
15.4.
Data Retention.
15.4.1.
Term . During the term of an applicable Statement of
Work, Service Provider shall retain Services Recipient’s Data
in its possession for as long as Services Recipient is required by
law, or by Services Recipient’s document retention policies
and practices (including any litigation data destruction holds), to
retain such Data associated with such Statement of Work.
Services Recipient shall inform Service Provider of any change in
requirements of law and policies and practices, which shall be
incorporated by reference into the applicable Statements of
Work. Nothing in this Article 15 shall relieve
Service Provider of (i) other document retention requirements
expressly provided in this Agreement or the Purchase Agreement or
(ii) its obligation to modify the Services to conform to any
requirement of Law.
15.4.2.
Post-Term . Upon expiration or termination of a
Statement of Work, a particular Service, or upon request by
Services Recipient at any time with respect to particular 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 Statement of Work, Service
Provider shall return to Services Recipient the Data associated
with such Statement of Work in the form and manner reasonably
requested by Services Recipient, including all copies of documents,
papers or other material that may contain Services
Recipient’s Confidential Information and delete from its
servers any electronic copies of all such information (excluding,
for purposes of this Section 15.4.2 , copies of this
Agreement) that are in Service Provider’s possession or
control. Service Provider shall thereafter remove such Data from
its applications
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and databases and shall
use mutually approved data destruction methods to remove such Data
from its back-up systems. Notwithstanding the foregoing, for
so long as Services Recipient does not request the return of its
Data, Service Provider shall maintain it in accordance with
Section 8S of the Purchase Agreement, regardless of whether
such Data was created before or after the Execution
Date.
15.4.3.
Destruction of Data. Service Provider shall destroy
Services Recipient’s Data held by it when and as required by
Services Recipient’s Document Retention policies from time to
time in effect and by the terms of any Statement of Work providing
for records management services.
15.4.4.
Record of Destruction of Data . Whenever Data of a
Services Recipient is required to be destroyed in accordance with
this Agreement, such Services Recipient may require a certification
of such destruction from the Relationship Manager for the other
Party.
15.5.
Preservation of Section 8S.
Notwithstanding anything to
the contrary in this Article 15, each party shall continue to
have access to and rights to utilize the other party’s
records created prior to the Execution Date to the extent provided
for in Section 8S of the Purchase Agreement.
16.
Audits.
Services Recipient shall have the right, at its
cost, no more than two (2) times per year, upon reasonable
request and during Service Provider’s business hours, to
conduct financial, internal, operation, security (physical and
electronic) and other technical audits with respect to the
Services, at Services Recipient’s expense. Such audits
are in addition to the invoice audit rights provided for in
Article 10 hereof. Service Provider shall reasonably
cooperate with such audits by making Personnel, documentation and
other information reasonably available to Services Recipient.
Services Recipient may conduct such audits with its own employees
or with the employees of consultants, including those of its
financial auditor.
17.
Reserved.
18.
Intellectual Property
18.1.
Services Recipient Licenses to Service
Provider
18.1.1.
Services Recipient Proprietary Software and Services Recipient Work
Product . Subject to the other terms and conditions of
this Agreement, Services Recipient hereby grants to Service
Provider a non-exclusive, worldwide, royalty-free, non-transferable
license to use, copy, maintain, modify, enhance and create
derivative works of (i) Services Recipient’s Proprietary
Software (and any design, architecture and techniques of software
development or enhancements related thereto) set forth in any
applicable Statement of Work, (ii) the Work Product and
Deliverables created for Services Recipient, and (iii) the
methodology and tools related to any of the foregoing, all solely
for the purpose of providing the Services to Services Recipient
pursuant to this Agreement. Except as otherwise requested or
approved by Services Recipient, Service Provider shall cease all
use of Services Recipient’s Proprietary Software and the
Services Recipient Work Product at the end of the Term, or as
otherwise provided for in this Agreement or any Statement of
Work.
18.1.2.
Services Recipient Work Product . All Services Recipient
Work Product, Deliverables and other materials created for Services
Recipient shall be considered “works made for hire” and
shall be owned by Services Recipient, and Services Recipient shall
be, pursuant to the Copyright Act, the author of such work.
If any such Work Product, Deliverables or other materials may not
be considered a “work made for hire” under applicable
Law, Service Provider hereby irrevocably assigns,
12
and shall assign, to
Services Recipient, without further consideration, all of Service
Provider’s right, title, and interest in and to the
copyrights in such Work Product, Deliverables and other materials
and waives any moral rights therein to the fullest extent permitted
under applicable Law.
18.1.3.
Further Assurances . Service Provider shall assist
Services Recipient and its nominee or assignees, at any time, in
the protection of the worldwide right, title, and interest in and
to any Services Recipient Work Product, Deliverables or other
materials created for Services Recipient, including the execution
of all formal assignment documents requested and prepared by
Services Recipient or its nominee or assignee and the execution of
all lawful oaths and applications for registration of copyright
in
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