“** Confidential Treatment
Requested”
Indicates portions of this document that have been deleted and have
been separately filed with the Securities and Exchange
Commission.
MASTER SERVICES AGREEMENT
by and between
Eurobancshares, Inc., a Commonwealth of Puerto Rico
Corporation
and
Telefonica USA, Inc., a Florida corporation authorized to do
business in Puerto Rico, d/b/a
Telefonica Empressas as of
August 6, 2007
TABLE OF SCHEDULES
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Schedule 3.7
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Security
Requirements
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Schedule 5.1
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Account
Governance
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Schedule 5.7
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Subcontractors
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Schedule 5.8
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Change
Control Procedures
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Schedule 6.7
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Benchmark
Methodology
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Schedule 7.1
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Affiliates
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Schedule 14.1
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Insurance
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Schedule 15.6
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Exit
Rights
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Schedule 16.1
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Dispute
Resolution Procedure
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Schedule 17.1
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Disaster
Recovery Plan
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Schedule 18.1
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Affected
Employees Provisions
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MASTER SERVICES AGREEMENT
This
MASTER SERVICES AGREEMENT (this “
Agreement ”)
is entered into as of August
6 , 2007 (the “
Effective Date ”),
by and between Eurobancshares, Inc., a Commonwealth of Puerto Rico
corporation (collectively, “
Company ”),
and Telefonica USA, Inc., a Florida corporation authorized to do
business in Puerto Rico, d/b/a Telefonica Empressas (“
Service Provider ”).
Terms used in this Agreement are either defined in the context in
which they are used or in Article XX hereto.
ARTICLE I
TERM AND RENEWAL
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1.1.
|
Term and Renewal .
The term of this Agreement (the “
Agreement Term ”)
will commence on the Effective Date, and shall continue for the
longer of five (5) years or so long as any Statement of Work (each
a “
SOW ”)
hereunder is in effect. The term of a SOW for In-Scope Services
under this Agreement (the “
SOW Term ”)
will be for the period set forth therein.
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ARTICLE II
TRANSITION
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2.1.
|
Service Commencement
.
As
of the applicable SOW Effective Date, and following completion of
the Transition in accordance with this Article II, Service Provider
shall assume operational responsibility for, and commence
providing, the In-Scope Services covered by such SOW.
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2.2.
|
Transition Services .
Commencing on the SOW Effective Date of the applicable SOW and
during the term of the Transition Period for such SOW, Service
Provider will perform the services (the
“
Transition Services
” )
set forth in the
written transition plan for a SOW, which plan shall be attached as
a Schedule to such SOW (the
“
Transition Plan
”) ,
in
order to facilitate the transition of operational responsibilities
(the
“
Transition” ).
The
Transition Plan shall constitute part of the applicable SOW. Each
Transition Plan shall include a description of the applicable
Transition Services, each party’s responsibilities with
respect to the Transition Services, the applicable Service Charges,
and the applicable term for such Transition Services. If
applicable, each Transition Plan shall also address the transition
of the Services from Company Facilities (as defined in Section 3.9)
to Service Provider facilities.
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2.3
|
C
ompany’s
failure to perform a duty,
obligation or responsibility expressly set forth in this Agreement
or a SOW related to the Transition Services (a “
Responsibility ”)
will
excuse
Service Provider’s obligation to perform its corresponding
obligations under this Agreement
or
a SOW only if Service
Provider provides
Notice to Company of such failure and demonstrates that:
(i)
C
ompany’s
failure was the direct cause of S
ervice
Provider’s inability to perform; and (ii)
Service
Provider could
not have continued performance by using reasonable methods,
activities and procedures that are different than those procedures
set forth in the
applicable SOW. In the event of (i)
and
(ii)
,
Service
Provider will
be excused from performance of the Services impacted by
Company’s failure to perform only to the extent that, and for
so long as, C
ompany’s
failure to perform its Responsibilities
prevents
S
ervice
Provider’s performance, and provided that Service
Provider takes
reasonable steps to mitigate the effects of Company’s
failure to perform. Notwithstanding anything to the contrary in
this Section 2.3, Company acknowledges that Service Provider shall
not be required to incur any additional costs, including without
limitation, third party costs, or commit Company to incur third
party costs, in order to satisfy its obligations in either of the
foregoing two (2) sentences.
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ARTICLE III
SERVICES
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3.1.
|
In-Scope Services .
Commencing on the applicable SOW Effective Date and during the
remainder of the SOW Term, Service Provider shall provide to
Company, and Company shall obtain from Service Provider, the
services set forth from time to time on the SOW(s) under this
Agreement (the “
In-Scope Services ”).
Each SOW shall include a description of the applicable In-Scope
Services, the Service Level Agreement applicable to the performance
of such In-Scope Services, each party’s responsibilities with
respect to the In-Scope Services, the Charges Schedule applicable
to such In-Scope Services and other terms specific to such In-Scope
Services.
Except
as set forth on the Charges Schedule to a SOW, none of the In-Scope
Services will be subject to minimum commitments.
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3.3.
|
Inherent Services .
If any services, functions or
responsibilities
not specifically described in this Agreement
or
a
SOW are
required for the proper performance and provision of the
Services
as
carried out by Company prior to each SOW Effective Date,
or
are
an inherent part of or
necessary
sub-task included within the Services
,
they will be deemed to be implied by and included within the scope
of the Services
to
the same extent and in the same manner as if specifically described
in a
SOW (“
Inherent Services ”).
Unless otherwise expressly provided in this Agreement
,
Service
Provider will
furnish all necessary management, supervision, labor, facilities,
furniture, computer and telecommunications equipment, software,
supplies and materials necessary to provide the Services.
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3.4.
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Compliance with Company Policies .
In providing Services to Company, and without limiting or modifying
in any respect the Service Provider’s Service obligations
(including pursuant to the Service Level Agreement), Service
Provider shall comply, and shall cause each of its employees and
subcontractors to comply at all times, with Company corporate
policies that are of general application to Company contractors
that have been communicated to Service Provider in writing or that
Service Provider has otherwise agreed to comply with.
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3.5.
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Regulatory Compliance .
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(a)
|
Company
will obtain and maintain all Governmental Approvals applicable to
Company in the conduct of its businesses and will identify,
interpret and comply, and cause its employees, agents and
subcontractors (other than Service Provider), to comply, in all
material respects with the Laws applicable to Company’s
business and operations reasonably related to Company’s
receipt and use of the Services (the “
Company Regulatory Requirements
”).
Company Regulatory Requirements also include any guidance,
bulletins, white papers, pronouncements, reports or similar
communications issued by any Governmental Authority or applicable
self-regulatory or industry body, whether or not such items or
materials have the force of Law, to the extent determined by
Company in its discretion.
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(b)
|
As
part of the In-Scope Services, Service Provider will obtain and
maintain all Governmental Approvals applicable to Service Provider
in the conduct of its business and identify, interpret and comply,
and cause its employees, agents and subcontractors to comply, in
all material respects with all Laws applicable to Service
Provider’s provision of the Services, including all Laws
affecting Service Provider’s performance under this Agreement
or relating to Service Provider’s employment of its
employees, its qualifications and ability to do business and to
provide the Services contracted for herein, and its operation of
owned and leased facilities. The obligations set forth in this
paragraph (b) are collectively, the “
Service Provider Regulatory
Requirements .”
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(c)
|
In
addition Service Provider will, and will cause its employees,
agents and subcontractors to: (i) provide all assistance reasonably
related to the In-Scope Services necessary to enable Company to
comply with the Company Regulatory Requirements; and (ii) comply
with all Company Regulatory Requirements reasonably relating to the
provision or receipt of the In-Scope Services of
which Company has made Service Provider aware. The obligations set
forth in this paragraph (c) are collectively, “
Compliance Assistance ”)
and shall be further subject to Section 3.6 hereof.
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(d)
|
In
addition, Company will, and will cause its employees, agents and
subcontractors (other than Service Provider) to: (i)
notwithstanding anything to the contrary set forth herein or in any
SOW, upon Company’s request, provide all assistance
reasonably related to the In-Scope Services necessary to enable
Service Provider to comply with the Service Provider Regulatory
Requirements; and (ii) comply with all Service Provider Regulatory
Requirements reasonably relating to the provision or receipt of the
In-Scope Services, provided that (a) Company has been given Notice
regarding the Service Provider Regulator Requirements, and (b) the
obligations of Company set forth in this Section 3.5(d) do not
cause a disruption to Company’s business or
operations.
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(e)
|
If
either party receives an official charge of non-compliance from a
Governmental Authority with respect to the performance of either
party’s obligations under this Agreement, the party receiving
such Notice will promptly notify the other party of such charge in
writing. Service Provider shall be responsible for any fines and
penalties imposed on Service Provider or Company arising from any
failure by Service Provider, its affiliates, agents or
subcontractors to comply with the Service Provider Regulatory
Requirements or with any Company Regulatory Requirements for which
Service Provider has responsibility pursuant to Section 3.5, except
to the extent that such noncompliance was caused by an act,
omission or breach of this Agreement by Company, its affiliates,
agents or subcontractors. Company shall be responsible for any
fines and penalties imposed on Service Provider or Company arising
from any failure by Company or its agents or subcontractors to
comply with the Company Regulatory Requirements (except to the
extent outsourced to Service Provider pursuant to Section 3.5(c)),
except to the extent that such noncompliance was caused by an act,
omission or breach of this Agreement by Service Provider, its
affiliates, agents or subcontractors.
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3.6.
|
Required Changes to In-Scope Services .
Service Provider will modify its provision of the In-Scope Services
if necessary to (i) comply with changes in the Service Provider
Regulatory Requirements, Company Regulatory Requirements (as
communicated by Company to Service Provider in writing), or any
other applicable Laws, or (ii) provide the Compliance Assistance.
Where any change in Law or any Service Provider Regulatory
Requirement or Company Regulatory Requirement, or the provision of
Compliance Assistance, requires a change in the In-Scope Services,
(A) Service
Provider will be financially responsible for modifications to the
In-Scope Services it is required to make resulting from changes in
Service Provider Regulatory Requirements and
shall not impose any additional Service Charges on Company for such
changes; and (B) Company shall be responsible for additional
Service Charges associated with (I) Service Provider’s
modifications
to the In-Scope Services it is required to make resulting from
changes in Company
Regulatory Requirements, provided,
however if a change in Company Regulatory Requirements affects
other Service Provider customers, then Service Provider will use
reasonable efforts to spread that cost of modifications to its
performance of services across its affected customers and Company
will pay only its pro rata share associated with such
modifications, and (II) the provision of Compliance
Assistance .
Notwithstanding anything to the contrary in the foregoing sentence,
Company acknowledges that certain cost sharing activities as
referenced in the preceding sentence may not be achieved without
the cooperation of other Service Provider customers, over which
Service Provider has no control. The parties shall use the Change
Control Procedures to document any and all Changes to the In-Scope
Services resulting from any Changes described in this Section or
from any other Changes required pursuant to any other Laws. Service
Provider expressly acknowledges and agrees that any Changes that
are required by changes in Laws are mandatory and Service Provider
has no discretion whether or not to accept the Change, provided
that Company agrees to pay any applicable additional Service
Charges in accordance with this Section associated with
implementing such Change.
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3.7.
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Security Requirements.
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(a)
|
Safeguards .
Service Provider shall establish an information security program
with respect to Company Data and Confidential Information (both of
which are defined below) which: (i) ensures the security and
confidentiality of such materials and information; (ii) protects
against any anticipated threats or hazards to the security or
integrity of such materials and information, and (iii) protects
against any unauthorized use of or access to such materials and
information, including access or use that could result in
substantial harm or inconvenience to any of Company’s
customers, consumers, or employees. Service Provider shall also
establish and maintain network and internet security procedures,
protocols, security gateways and firewalls with respect to such
materials and information. All of the foregoing shall be in
accordance with the attached
Schedule 3.7 ,
no less rigorous than those safeguards and procedures maintained by
Company prior to the Effective Date which have been communicated by
Company to Service Provider in writing and those maintained by
Service Provider for its own data and information of a similar
nature.
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(b)
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Physical Security .
Service Provider will maintain and enforce at any site from which
In-Scope Services are rendered safety and security procedures that
are in accordance with the attached
Schedule 3.7 and
the most rigorous industry standards and at least as rigorous as
those procedures in effect at sites from which Company provided
such services as of the Effective Date and which procedures have
been communicated by Company to Service Provider in writing. In
addition, Service Provider will comply with all reasonable
requirements of Company with respect to security at such
sites.
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(c)
|
Security Assessment .
Without limiting the generality of the foregoing, Service
Provider’s information security policies shall provide for
(i) regular assessment and re-assessment of the risks to the
security of Company Data and systems acquired or maintained by
Service Provider and its agents and contractors in connection with
rendering the In-Scope Services, including (a) identification of
internal and external threats that could result in a Security
Breach (as defined below), (b) assessment of the likelihood and
potential damage of such threats, taking into account the
sensitivity of such data and systems, and (c) assessment of the
sufficiency of policies, procedures, and information systems of
Service Provider and its agents and subcontractors, and other
arrangements in place, to control risks; and (ii) protection
against such risks.
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(d)
|
Security Breach .
“Security Breach” means
(A) any circumstance pursuant to which applicable Law requires
notification of such breach to be given to affected parties or
other activity in response to such circumstance; or (B) any actual,
attempted, suspected, threatened, or reasonably foreseeable
circumstance that compromises, or could reasonably be expected to
compromise, either Physical Security or Systems Security (as such
terms are defined below) in a fashion that either does or could
reasonably be expected to permit unauthorized Processing, use,
disclosure or acquisition of or access to any Company Data or
Confidential Information.
“Physical Security”
means
physical security at any site or other location housing systems
maintained by Service Provider or its agents or subcontractors in
connection with the In-Scope Services. “
Systems Security” means
security of computer, electronic or telecommunications systems of
any variety (including data bases, hardware, software, storage,
switching and interconnection devices and mechanisms), and networks
of which such systems are a part or communicate with, used directly
or indirectly by Service Provider or its agents or subcontractors
in connection with the In-Scope Services.
“Processing” means
any operation or set of operations performed upon Company Data or
Confidential Information, whether or not by automatic means, such
as creating, collecting, procuring, obtaining, accessing,
recording, organizing, storing, adapting, altering, retrieving,
consulting, using, disclosing or destroying.
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(e)
|
Breach Notification .
In the event Service Provider becomes aware of any Security Breach,
Service Provider shall, (i) immediately notify Company’s
Chief Compliance Officer of such Security Breach and perform a root
cause analysis thereon, (ii) investigate such Security Breach,
(iii) provide a remediation plan, acceptable to Company, to address
the Security Breach and prevent any further incidents, (iv) conduct
a forensic investigation to determine what systems, data and
information have been affected by such event; and (v) cooperate
with Company, any law enforcement or regulatory officials, credit
reporting companies, and credit card associations investigating
such Security Breach. Subsequent to the initial response to any
Security Breach as set forth above, the parties shall cooperate in
good faith to determine financial responsibility for such event, as
follows. If the Security Breach is a result of an act or omission
of Service Provider other than in accordance with the terms of this
Agreement, including the applicable SOW, such corrective actions
shall be provided by Service Provider at its own expense. If the
Security Breach does not result from an act or omission of Provider
other than in accordance with the terms of this Agreement,
including the applicable SOW, such corrective actions shall be
provided pursuant to the Change Control Procedures. Without
limiting the foregoing, Company shall make the final decision on
notifying Company’s customers, employees, service providers
and/or the general public of such Security Breach, and the
implementation of the remediation plan. If a notification to a
customer is required under any Law or pursuant to any of
Company’s privacy or security policies, then notifications to
all customers who are affected by the same event (as reasonably
determined by Company) shall be considered legally required. Any
changes to the Services necessary as a result of such Security
Breach which constitute Additional Services (as defined in the
Charges Schedule) shall be subject to the Change Control
Procedures.
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(f)
|
Notification Related Costs .
In addition to any other obligations or liabilities of Service
Provider in connection therewith, if the Security Breach is a
result of an act or omission of Provider other than in accordance
with the terms of this Agreement, including the applicable SOW,
Service Provider shall reimburse Company for all reasonable out of
pocket Notification Related Costs incurred by Company arising out
of or in connection with any such Security Breach resulting in a
requirement for legally required notifications (as determined in
accordance with the previous sentence).
“Notification Related Costs”
shall
include Company’s external costs associated with addressing
and responding to the Security Breach, including but not limited
to: (i) preparation and mailing or other transmission of legally
required notifications; (ii) preparation and mailing or other
transmission of such other communications to customers, agents or
others as Company deems reasonably appropriate; (iii) establishment
of a call center or other communications procedures in response to
such Security Breach (e.g., customer service FAQs, talking points
and training); (iv) public relations and other similar crisis
management services; (v) legal and accounting fees and expenses
associated with Company’s investigation of and response to
such event; and (vi) costs for commercially reasonable credit
reporting services that are associated with legally required
notifications or are advisable under the circumstances.
In
the event that the parties disagree as to the cause of any Security
Breach, such disagreement shall be resolved through the Dispute
Resolution Procedures.
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(g)
|
Intrusion Detection/Interception .
Service Provider will provide Company and its representatives with
access, upon reasonable advance notice and during normal business
hours, to Service Provider’s test results, systems, policies
and procedures relating to intrusion detection and interception
with respect to the Service Provider systems used to provide the
Services for the purpose of examining and assessing, or having
examined and assessed, those test results, systems, policies and
procedures. Service Provider will also permit Company and its
representatives the ability to conduct internal and external
intrusion detection, interception testing and other assessment and
examination of Service Provider’s systems as reasonably
necessary to comply with Company’s regulatory obligations and
confirm compliance with each of Service Provider’s activities
pursuant to this Section 3.7, provided that any such assessments or
examinations will be conducted in a manner that does not
unreasonably disrupt or delay Service Provider’s performance
of the Services hereunder or any other services for its other
customers.
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3.8.
|
Service Locations .
The In-Scope Services will be provided from those Service Provider
location(s) specified in the applicable SOW (each, a “
Service Location ”).
Service Provider will not, without the express written Consent of
Company, Change, consolidate, eliminate or add to the Service
Locations, or reallocate the volume or nature of work processed
between Service Locations.
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3.9
|
Company Facilities .
If required by a SOW, Company shall provide to Service Provider the
office space at the Company locations identified as Company
Facilities in such SOW (the
“Company Facilities”
),
as the same may be changed by Company from time to time throughout
the applicable SOW Term, in accordance with the terms and
conditions set forth in this Section 3.9, or in accordance
with the specific terms and conditions set forth in such SOW.
Subject to the terms and conditions set forth in this
Section 3.9, all decisions regarding the allocation of office
space at Company Facilities to Service Provider shall be made by
Company.
|
(a)
With
respect to such Company Facilities, Service Provider shall
have the same privileges regarding use thereof (such as
heating, lights, air conditioning (‘HVAC’)
systems, as do any other tenants of Company. Except as
otherwise set forth in a SOW, Company shall be responsible for
providing, at its own expense, all other facilities and
support Service Provider’s needs at the Company
Facilities to provide the Services, including office-related
equipment (i.e., personal computers, printers, fax machines
and copiers), office supplies, and local and long distance
telephony.
(b)
Subject
to the terms of the applicable SOW, Company shall be fully
responsible for all costs and expenses of applicable
facilities leases, related leasehold improvements, and
utilities with respect to Company Facilities, and shall pay
all Company Facilities landlords and utility providers
directly.
(c)
The
Company Facilities shall be made available to Service Provider
on an “AS IS, WHERE IS” basis, with no warranties
whatsoever.
(d)
Company
and Company Affiliates, and agents and representatives of
each, shall have the right to enter into any portion of
Company Facilities at any time for any reason, including,
without limitation, for the purpose of inspecting Company
Facilities, showing Company Facilities, or performing services
related to Company Facilities.
(e)
Service
Provider agrees that Service Provider and Service Provider
personnel will at all times comply with all leases and other
agreements applicable to its occupation and use of the Company
Facilities pursuant to the terms of this
Agreement.
(f)
The
transition of the Services from Company Facilities to Service
Provider facilities shall be set forth in the Transition Plan
applicable to the SOW for such Services.
(a)
Service
Provider shall use Company Facilities, Company Software
(except for Software licensed or sublicensed to Company by
Service Provider), Company equipment (except for equipment
provided to Company by Service Provider) and related
Company-owned resources (collectively,
“Company Resources”
)
for the sole and exclusive purpose of providing the Services,
unless in its sole discretion Company pre-approves another use in
writing in a SOW or through the Change Control Procedures. The use
of Company Facilities by Service Provider shall not constitute a
leasehold or other property interest in favor of Service
Provider.
(b)
Service
Provider shall be responsible for any damage (normal wear and
tear excepted) to Company Resources resulting from the abuse,
misuse, neglect, or negligent acts or omissions of Service
Provider or other failure to comply with the obligations
respecting Company Resources.
(c)
Service
Provider shall keep Company Resources in good order (normal
wear and tear excepted), not commit or permit waste or damage
to Company Resources or use Company Resources for any unlawful
purpose or act, and shall comply with Company’s standard
policies and procedures (including applicable leases)
regarding access to and use of Company Resources which have
been communicated by Company to Service Provider in writing,
including procedures for the physical security of Company
Facilities.
(d)
Service
Provider shall not make improvements or changes involving
structural, mechanical or electrical alterations to Company
Facilities without Company’s prior written approval. At
Company’s election, any improvements or fixtures to
Company Facilities shall become the property of Company. If
Company does not elect to take title thereto, Provider shall
remove the same at the end of the use of Company Facilities
and shall repair any damage caused by such
removal.
(e)
When
Company Resources are no longer required for performance of
the Services, Provider shall return them to Company in
substantially the same condition as when Provider began use of
them (normal wear and tear excepted).
3.11
Dedicated Environment .
For purposes of the initial SOW entered into as of the date hereof,
all hardware and software provided by Company at any time during
the term of such SOW shall be dedicated solely to Company; any
hardware and software provided by Service Provider may be shared
with other Service Provider customers, but shall be logically
partitioned so that there is no intermingling of Company Data or
Confidential Information with that of other Service Provider
customers and no other Service Provider customers or others shall
have the ability to access such information or data.
ARTICLE IV
SERVICE PROVIDER PERFORMANCE METRICS
|
4.1.
|
Service Level Agreement. Service
Provider will perform the In-Scope Services at all times during the
SOW Term and any Termination Assistance Period in accordance with
specific performance standards identified by Company in each of the
SOWs (the “
Service Level Agreement ”).
The Service Level Agreement will indicate the level of performance
Service Provider must achieve for each service metric (the
“
Service Level ”).
Service Provider shall perform all In-Scope Services without an
expressly defined Service Level Agreement at a level of accuracy,
completeness, availability, timeliness, quality, responsiveness and
performance that equals or exceeds the level of performance by
Company or any Third Party providing such services for Company
immediately before the applicable SOW Effective Date (in the case
of In-Scope Services).
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4.2.
|
Service Level Measurement .
Beginning on the SOW Effective Date, Service Provider shall
implement and operate all measurement and monitoring tools and
procedures required to measure and report its performance relative
to the applicable Service Level Agreement. Each Service Level
Agreement will be measured on at least a monthly basis, unless
otherwise indicated. Service Provider shall provide, as part of
Service Provider’s monthly performance reports, a set of hard
(if requested by Company) and soft-copy reports to verify Service
Provider’s performance and compliance with the Service Level
Agreement (“
Performance Reports ”).
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4.3.
|
Service Level Failures. Service
Provider’s failure to meet the Service Level for any Service
Level Agreement shall entitle Company to receive credits against
Service Charges in the form of Service Level Credits in accordance
with this Section if such Service Level Agreement has Service Level
Credits associated with it.
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(a)
|
Calculation of Service Level Credits .
Service Provider will provide to Company a Service Level Credit
Report resulting from Service Provider’s failure to
meet any
Service Level for any Critical Performance Indicator (
each,
a “
Performance Failure ”).
Service Level Credits will be calculated each month for Performance
Failures, and determined pursuant to the applicable SOW,
referencing the Critical Performance Indicator to which the
Performance Failure relates.
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(b)
|
Issuance of Credits .
Company will review the report of Service Level Credits (if any)
issued by Service Provider each month and notify Service Provider,
within 30 days, of any issues with such report and/or its election
to receive such credits on the next issued invoice following such
notification from Company. If Company so elects, Service
Provider will reduce the amount payable by Company on the next
Invoice by the amount of Service Level Credits Company received
during the applicable month. Service Level Credits for a
given month shall not exceed the total monthly bill payable by
Company for any applicable period.
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(c)
|
Root Cause Analysis .
Service Provider will be required to conduct, at its expense, a
root cause analysis for each failure to meet any Service Level.
Upon determination of the cause of such failure, Service Provider
will provide to Company an additional report that details the
results of the root cause analysis, and which details any measures
that should be taken to minimize the possibility that such failures
will re-occur. To the extent that the root cause analysis indicates
that Service Provider’s failure to meet the Service Level was
caused by Service Provider, Service Provider will correct the
problem at no additional cost to Company and ensure that there will
be no re-occurrence of such failures.
|
ARTICLE V
RELATIONSHIP MANAGEMENT
|
5.2.
|
Service Provider Project Manager .
During the Agreement Term, Service Provider will designate a
senior-level individual who will be primarily dedicated to
Company’s account (the “
Service Provider Project Manager
”).
The Service Provider Project Manager may be replaced by Service
Provider from time to time during this Agreement. In addition, the
Service Provider Project Manager (i) must be approved by Company,
(ii) will be the primary contact for Company in dealing with
Service Provider under this Agreement, (iii) will have overall
responsibility for managing and coordinating the delivery of the
Services, (iv) will meet regularly with the Company Contract
Manager, and (v) will have the power and authority to make
decisions with respect to actions to be taken by Service Provider
in the ordinary course of day-to-day management of Company’s
account in accordance with this Agreement.
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|
5.3.
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Company Contract Manager .
During the Agreement Term, Company will designate a senior level
individual (i) who will serve as Company’s primary contact
for Service Provider in dealing with Company under this Agreement,
and (ii) who will have the power and authority to make decisions
with respect to actions to be taken by Company in the ordinary
course of day-to-day management of this Agreement (the
“
Company Contract Manager ”
(may also be referred to in the SOWs as “Company Project
Manager”)). Company may from time to time replace the
individual serving as the Company Contract Manager by providing
Notice to Service Provider.
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5.5.
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Annual Review .
On an annual basis during the Agreement Term, the Contract Managers
shall conduct an annual performance review attended by certain of
the senior management of each party (the “
Annual Review ”).
The parties contemplate that such Annual Review will include at
least the following:
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(a)
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Review
of the previous year’s periodic Performance Reports prepared
by Service Provider;
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(b)
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Review
and adjustment of the Service Level Agreement requirements and the
associated performance measures and metrics pursuant to Article
IV;
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(c)
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Adjustments
to the Service Charges in accordance with the Charges Schedule;
and
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(d)
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Review
of emergency response and disaster recovery plans that have been
adopted and implemented by Service Provider for the
Services.
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Any
adjustments undertaken pursuant to this Section shall be governed
by Section 5.8.
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5.6.
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Review Meetings .
During the Agreement Term, the Service Provider Project Manager and
the Company Contract Manager (and any other appropriate operational
personnel) shall meet periodically, at such intervals and at such
times and locations as set forth in the Account Governance Schedule
or as reasonably requested by Company, but in no event less than
once per calendar quarter, to review their respective performance
under this Agreement and to discuss planned or anticipated
activities that may adversely affect performance or any
Changes.
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5.7.
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Service Provider Subcontractors .
Service Provider may not subcontract any of the Services without
Company’s prior written Consent, provided, however the
subcontractors listed on
Schedule 5.7 hereto
are pre-approved subcontractors for the purposes of this Section
5.7 and that Service Provider may utilize an Affiliate to provide
the Services. Service Provider may also retain a Third Party in
certain circumstances to perform Services as set forth in Section
17.1(b). The following shall apply to any permitted subcontractor
relationship hereunder:
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ARTICLE VI
PAYMENT
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6.1.
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Service Charges .
In consideration for the performance of the Services, Company shall
pay to Service Provider the charges for the Services (the
“
Service Charges ”)
specified in the Transition Plan and SOWs hereunder (collectively,
the “
Charges Schedule ”).
Except as otherwise expressly stated or provided for in this
Agreement or an SOW, as same may be amended pursuant to the Change
Control Procedures, Company will not be obligated to pay Service
Provider any amounts in addition to the Service Charges for Service
Provider’s performance of the Services.
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6.3.
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Invoices; Method of Payment .
Service Provider shall render an invoice substantially in the form
attached to the Charges Schedule (“
Invoice ”)
in accordance with the invoicing procedures set forth in the
Charges Schedule on or after the first business day of each
calendar month which shall reflect (i) the current month’s
Service Charges, (ii) any pass through charges under the Charges
Schedule accrued during the preceding month, (iii) when applicable
pursuant to the Service Level Agreement, any Service Level Credits,
and (iv) such other amounts as may from time to time arise under
this Agreement that may appropriately be reflected on Invoices
hereunder. Each Invoice will include such detail as reasonably
requested by Company to satisfy Company’s internal accounting
and chargeback requirements and as set forth in the Charges
Schedule (which detail shall also be provided in electronic format
compatible with Company’s financial computer systems). All
amounts due to Service Provider and set forth on a valid Invoice
delivered pursuant to this Section shall be due and payable within
thirty (30) days of Company’s receipt of such Invoice. Any
amounts not paid when due shall accrue interest at the rate of
twelve percent (12%) per annum (or, if lower, the maximum rate
permitted by applicable law).
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6.4.
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Unused Credits .
Any unused credits against future payments or other undisputed
amounts owed to either party by the other pursuant to this
Agreement will be paid to the applicable party within forty-five
(45) days after the expiration or termination of this
Agreement.
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Disputed Charges .
Company may withhold payment to Service Provider of amounts that
Company reasonably and in good faith disputes. Any amounts (or
portions thereof) not so disputed otherwise will be paid by the
applicable payment due date as otherwise provided for in this
Agreement. Company shall notify Service Provider in writing on or
before the payment due date of any disputed charges for which it is
withholding payment. Notwithstanding Section 6.3, Company shall not
be required to pay the disputed portion of an Invoice unless and
until the parties have successfully resolved the dispute in
accordance with the Dispute Resolution Procedures.
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6.6.
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Taxes .
Company
shall be solely
responsible for all indirect Taxes (including but not limited to;
Sales and Use Tax, Communications Services Tax and Value Added Tax)
imposed on, based on, or measured by any consideration for, arising
from, or due in connection with any provision of Services by
Service Provider to Company pursuant to this Agreement.
Should any amounts due under this Agreement be subject to
withholding or retention tax, Company shall notify Service Provider
prior to the withholding and provide Service Provider with the
adequate certifications that the withholding amounts were remitted
to the proper taxing authorities. Company shall not be
responsible for reporting and/or paying any income, franchise, real
property, personal property or ad valorem taxes due and assessed on
Service Provider. The Parties agree to work together
throughout the term of this Agreement in order to establish and
maintain the most advantageous tax consequences within the
parameters of all applicable laws.
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6.7.
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Benchmarking .
Beginning on the third (3
rd )
anniversary the Effective Date, and thereafter from time to time
during the Agreement Term, but not more often than once every
twelve (12) months, Company may, at its sole cost and expense,
measure the Service Charges and Service Levels under this Agreement
as compared to other organizations receiving similar services (a
“
Benchmark ”).
The
Benchmark
will
be based upon and consistent with, in all material respects, the
benchmarking methodology, principles and approach (the
“
Benchmark Methodology ”)
as
set forth in
Schedule
6.7 .
The
Parties
will
cooperate with each other and the selected
benchmarker to
facilitate the Benchmark
,
which will include
performing
their respective responsibilities set forth in the Benchmark
Methodology and providing the benchmarker
with
all information reasonably requested in accordance with the terms
of the Benchmark Methodology. If Service Provider is required to
deploy resources to participate in the Benchmark in addition to
those that are required to render the Services in accordance with
the terms hereof, Company and Service Provider shall mutually
determine in good faith such additional payments as may be required
in connection with such additional resources.
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ARTICLE VII
COMPANY AFFILIATES
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7.1.
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Services to Company Affiliates .
Service Provider will provide the Services to Company and its
current Affiliates that are forth on
Schedule 7.1 hereto
(and their successors). Company and the applicable Affiliate shall
be jointly and severally liable for the failure of any such
Affiliate to perform its obligations and duties with respect to
Services provided by Service Provider to such
Affiliate.
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7.2.
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Mergers and Acquisitions .
If Company
merges
with or
otherwise
acquires a Person
which
is a Third
Party (a
“
Company Acquisition ”),
then if requested by Company
in
its sole discretion, such entity will become subject to
this Agreement
,
with all rights and benefits and subject to all obligations
of Company
under
this Agreement
,
on the date specified by Company
.
In the event of a Company Acquisition, the
parties
will
renegotiate in good faith, the affected Service
Charges
to
account for any increased volume, all in accordance with
the Change
Control Procedures ,
provided, however, that in no event shall a Company Acquisition
give rise to any right by Company to terminate this
Agreement.
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7.3.
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Divestitures .
If Company
transfers
by sale, dividend to its shareholders, or
otherwise,
any shares of the common stock, or
all
or
substantially
all of the assets of any Affiliate,
or any line of business, business unit or division of Company or
any Affiliate of Company (a
“
Divested Entity ”),
and
such Divested
Entity does
not remain an Affiliate
of
Company
,
Service
Provider shall,
if requested by Company
,
provide the Services
directly
to the Divested
Entity at
the then -current
Service Charges for
a period of the lesser of (i)
the
remaining SOW Term of
the applicable Statement(s) of Work ,
(ii)
tw elve
(12) months from the date of the closing of any such disposition
(inclusive of any Termination
Assistance Services provided
by Service
Provider to
Company
),
or
(iii)
until
such time as Service
Provider and
such Divested
Entity ,
or
the
Divested
Entity and
a Third
Party enter
into a separate agreement (the “
Divestiture Service Period ”).
If
the twelve (12) month period of Services to the Divested Entity
expires causing the portion of the SOW applicable to the Divested
Entity to terminate prior to the date on which the overall SOW
would have otherwise terminated, the Divested Entity shall pay a
pro-rata portion of the Termination for Convenience Fee which would
have been due for early termination of the SOW otherwise due
pursuant to Section 15.1 hereof. Company shall be liable for making
payment of any amounts unpaid by the Divested Entity in connection
with this Section 7.3.
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ARTICLE VIII
REPRESENTATIONS, WARRANTIES AND COVENANTS
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8.1.
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Representations, Warranties and Covenants .
Service Provider hereby represents, warrants and covenants to
Company as follows:
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