EX-10.8 2 ssni-ex108_274.htm EX-10.8 ssni-ex108_274.htm

 

Exhibit 10.8

Execution Version

*** Certain omitted portions of this exhibit have been filed with the Securities and Exchange Commission pursuant to a request for confidential treatment under Rule 24b-2 promulgated under the Securities Exchange Act of 1934.

THIRD AMENDED AND RESTATED MASTER AGREEMENT

by and between

Silver Spring Networks, Inc.,

a Delaware corporation

and

The City of San Antonio,

acting by and through its City Public Service Board (CPS Energy)

Dated July 25, 2016

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


 

TABLE OF CONTENTS

 

 

 

 

 

Page

 

 

 

 

 

1.

 

PREAMBLE.

 

2

 

 

 

 

 

2.

 

LIST OF EXHIBITS

 

2

 

 

 

 

 

3.

 

RULES OF CONSTRUCTION; DEFINITIONS

 

3

 

 

3.1.

 

Rules of Construction

 

3

 

 

3.2.

 

Definitions

 

3

 

 

 

 

 

4.

 

AGREEMENT TO SELL AND PURCHASE PRODUCTS AND SERVICES; ECONOMIC DEVELOPMENT MILESTONES

 

15

 

 

 

 

 

 

 

 

 

4.1.

 

Agreement to Sell and Purchase Products and Services

 

15

 

 

4.2.

 

Economic Development Milestones

 

16

 

 

4.3.

 

ED Certification

 

17

 

 

 

 

 

5.

 

ORDERING, FORECASTING, SHIPMENT AND ACCEPTANCE OF EQUIPMENT

 

18

 

 

 

 

 

 

 

 

 

5.1.

 

Purchase of Equipment

 

18

 

 

5.2.

 

Forecasts

 

18

 

 

5.3.

 

Shipment

 

19

 

 

5.4.

 

Inspection and Acceptance or Rejection

 

19

 

 

5.5.

 

Change Orders

 

19

 

 

5.6.

 

Order Cancellations

 

20

 

 

5.7.

 

Changes in Products

 

20

 

 

5.8.

 

End of Life

 

20

 

 

 

 

 

6.

 

ORDERING SOFTWARE

 

21

 

 

 

 

 

 

 

 

 

6.1.

 

Purchase Orders

 

21

 

 

6.2.

 

Delivery of Software

 

21

 

 

 

 

 

7.

 

ORDERING SERVICES

 

21

 

 

 

 

 

 

 

 

 

7.1.

 

SOWs

 

21

 

 

7.2.

 

Contacts

 

21

 

 

7.3.

 

Use of Facilities

 

21

 

 

7.4.

 

Changes to SOW

 

21

 

 

7.5.

 

Software Support Services

 

21

 

 

7.6.

 

Transition Services

 

21

 

 

7.7.

 

Permits and Licenses

 

22

 

 

7.8.

 

GAS IMU Integration

 

22

 

 

7.9.

 

Integration with Customer Property and Facilities

 

22

 

 

7.10.

 

Installation Services

 

22

 

 

 

 

 

8.

 

EXECUTION MILESTONE ACCEPTANCE; SYSTEM ACCEPTANCE

 

22

 

 

 

 

 

 

 

 

 

8.1.

 

Execution Milestone Acceptance

 

22

 

 

8.2.

 

System Acceptance

 

22

 

 

 

 

 

9.

 

FEES; PAYMENT TERMS; TAXES

 

22

 

 

 

 

 

 

 

 

 

9.1.

 

Fees

 

22

 

 

9.2.

 

Payment Terms

 

22

 

 

9.3.

 

***

 

23

 

 

9.4.

 

Taxes

 

23

 

 

9.5.

 

Audit Rights

 

23

 

 

9.6.

 

***

 

24

 

 

 

 

 

i


 

10.

 

CONFIDENTIALITY

 

24

 

 

 

 

 

 

 

 

 

10.1.

 

Confidential Information

 

24

 

 

10.2.

 

Restrictions

 

24

 

 

10.3.

 

Mutual Cooperation

 

25

 

 

10.4.

 

Required Disclosures

 

25

 

 

10.5.

 

No Limitation

 

25

 

 

10.6.

 

Non-Disclosure of Agreement Terms

 

25

 

 

10.7.

 

Non-Disclosure of End Customer Information

 

25

 

 

10.8.

 

Customer Network Access

 

25

 

 

10.9.

 

Breach of Terms

 

25

 

 

10.10.

 

Survival

 

26

 

 

 

 

 

11.

 

INTELLECTUAL PROPERTY RIGHTS

 

26

 

 

 

 

 

 

 

 

 

11.1.

 

License Terms

 

26

 

 

11.2.

 

Ownership

 

26

 

 

11.3.

 

Proprietary Markings and Copyright Notices

 

27

 

 

11.4.

 

Data Privacy

 

27

 

 

 

 

 

12.

 

INFRINGEMENT

 

27

 

 

 

 

 

 

 

 

 

12.1.

 

Intellectual Property Indemnities

 

27

 

 

12.2.

 

SSN Options

 

27

 

 

12.3.

 

Exclusive Remedy

 

28

 

 

 

 

 

13.

 

REPRESENTATIONS AND WARRANTIES

 

28

 

 

 

 

 

 

 

 

 

13.1.

 

General

 

28

 

 

13.2.

 

Equipment

 

28

 

 

13.3.

 

Services

 

30

 

 

13.4.

 

Software

 

31

 

 

13.5.

 

***

 

31

 

 

13.6.

 

DNP 3.0 Compliance

 

32

 

 

13.7.

 

Work Product

 

32

 

 

13.8.

 

Documentation

 

32

 

 

13.9.

 

Invoices

 

32

 

 

13.10.

 

Title

 

32

 

 

13.11.

 

***

 

32

 

 

13.12.

 

Disclaimer of Implied Warranties

 

32

 

 

13.13.

 

Customer-installed Endpoints

 

33

 

 

13.14.

 

Third-Party Integrated Meters

 

33

 

 

 

 

 

14.

 

SOURCE CODE ESCROW

 

36

 

 

 

 

 

 

 

 

 

14.1.

 

Deposit of Source Code

 

36

 

 

14.2.

 

Escrow License

 

37

 

 

14.3.

 

Release of Escrow License and the Escrow Deposits to Customer

 

37

 

 

14.4.

 

Confidentiality

 

38

 

 

14.5.

 

Treatment in Bankruptcy

 

38

 

 

 

 

 

15.

 

INDEMNIFICATION

 

38

 

 

 

 

 

 

 

 

 

15.1.

 

General Indemnification

 

38

 

 

15.2.

 

Third-Party Claims

 

39

 

 

15.3.

 

Payment

 

39

 

 

15.4.

 

***

 

40

ii


 

 

 

 

 

 

16.

 

LIMITATIONS OF LIABILITY

 

40

 

 

 

 

 

 

 

 

 

16.1.

 

Disclaimer of Certain Damages

 

40

 

 

16.2.

 

Dollar Limit on Most Liabilities

 

40

 

 

 

 

 

17.

 

TERM AND TERMINATION

 

40

 

 

 

 

 

 

 

 

 

17.1.

 

Term

 

40

 

 

17.2.

 

Termination for Default

 

40

 

 

17.3.

 

Insolvency; Confidentiality

 

40

 

 

17.4.

 

Change in Law

 

41

 

 

17.5.

 

Convenience

 

41

 

 

17.6.

 

Additional Termination Rights

 

41

 

 

17.7.

 

Effect of Termination

 

41

 

 

17.8.

 

Notice

 

42

 

 

17.9.

 

Survival

 

42

 

 

 

 

 

18.

 

DELAYS

 

42

 

 

 

 

 

 

 

 

 

18.1.

 

SSN Delay

 

42

 

 

18.2.

 

Right to Liquidated Damages

 

42

 

 

18.3.

 

Customer Delay

 

43

 

 

18.4.

 

Excused Performance

 

44

 

 

18.5.

 

Force Majeure

 

44

 

 

 

 

 

 

 

19.

 

INSURANCE

 

44

 

 

 

 

 

 

 

 

 

19.1.

 

Insurance Requirements

 

44

 

 

19.2.

 

Maintenance of Insurance

 

45

 

 

19.3.

 

Right to Review Policies

 

45

 

 

 

 

 

20.

 

PERSONNEL; SUBCONTRACTORS

 

45

 

 

 

 

 

 

 

 

 

20.1.

 

Hosted Personnel

 

45

 

 

20.2.

 

SSN’s Personnel

 

46

 

 

20.3.

 

Subcontractors

 

46

 

 

 

 

 

 

 

21.

 

GENERAL

 

46

 

 

 

 

 

 

 

 

 

21.1.

 

Governing Laws

 

46

 

 

21.2.

 

Binding Upon Successors; Assignment

 

47

 

 

21.3.

 

Entire Agreement; Termination of Letter Agreement

 

47

 

 

21.4.

 

Severability

 

47

 

 

21.5.

 

Amendment and Waivers

 

47

 

 

21.6.

 

Preparation of Agreement

 

47

 

 

21.7.

 

Export Compliance and Foreign Reshipment Liability

 

47

 

 

21.8.

 

Notices

 

48

 

 

21.9.

 

Third-Party Beneficiaries

 

48

 

 

21.10.

 

Counterparts

 

48

 

 

21.11.

 

Independent Parties

 

48

 

 

21.12.

 

Dispute Resolution

 

49

 

 

21.13.

 

Precedence

 

49

 

 

21.14.

 

Utilization of Small Business Concerns

 

49

 

 

21.15.

 

Local and Diverse Businesses

 

49

 

 

21.16.

 

Specific Performance

 

50

 

 

21.17.

 

Conflicts of Interest

 

50

 

 

21.18.

 

Security

 

51

 

 

21.19.

 

***

 

51

 

 

 

iii


 

MASTER AGREEMENT

This Master Agreement establishes the terms under which Silver Spring Networks, Inc., a Delaware corporation (“SSN” or “Silver Spring”), will sell Equipment, license Software and provide Services to The City of San Antonio, acting by and through its City Public Service Board (CPS Energy) (“Customer” or “CPS Energy”).  This agreement consists of this signature page, the attached General Terms and Conditions and the attached Exhibits, as well as any Purchase Orders, Change Orders and Statements of Work entered into by the Parties in connection herewith, and any and all amendments or supplements thereto (collectively, this “Agreement”).

Customer:

CPS Energy

Address:  145 Navarro, San Antonio, Texas 78205

Customer Contact

***

Mail Drop 101006

145 Navarro Street

San Antonio, Texas, 78296-1771

***

 

Customer Billing Contact

***

Mail Drop 100705

145 Navarro Street

San Antonio, Texas 78296-1771

*** (telephone)

*** (facsimile)

***

SSN Contact

Steve Ingram

VP, Global Delivery

Silver Spring Networks

555 Broadway Street

Redwood City, California  94063

650-839-4560 (telephone)

650-839-4329 (facsimile)

singram@silverspringnet.com

 

Effective Date of Third Amended and Restated Master Agreement: July 25, 2016

 

CUSTOMER: CPS ENERGY

 

CUSTOMER: CPS ENERGY

 

 

 

 

 

 

 

By:

 

/s/ Cris Eugster

 

By:

 

/s/ Ken Gianella

Name:

 

Cris Eugster

 

Name:

 

Ken Gianella

Title:

 

Executive Vice President of Generation and Strategy

 

Title:

 

Interim Chief Financial Officer

Date:

 

July 25, 2016

 

Date:

 

July 25, 2016

 

 

1


 

MASTER AGREEMENT

GENERAL TERMS & CONDITIONS

1.

PREAMBLE.

SSN and Customer are parties to that certain Second Amended and Restated Master Agreement, dated December 22, 2014 (the “Second A&R Master Agreement”). SSN and Customer desire to, and do hereby, amend and restate the Second A&R Master Agreement, in its entirety, including the revised Exhibits A, B-1, B-2, B-3, B-4, B-5 (deleted), C-1, C-2, C-3, C-4, D, E, F (deleted), G (incorporated), I, J, N, Q, R, S, V-1, V-2, V-3 (added), X, Y and AA attached hereto, to, among other things, eliminate Consert DR requirements and to update the Economic Development Milestones and the general timeline of the Project, in each case as set forth in this Agreement.

These “General Terms and Conditions” are applicable to all Products and Services provided to Customer pursuant to this Agreement.  Exhibits to this Agreement provide additional terms and conditions applicable to specific Products and Services.

2.

LIST OF EXHIBITS.

 

 

Exhibit A:

 

Minimum Insurance Requirements

 

Exhibit B:

 

Pricing & Execution Milestones

 

 

 

 

Part 1: Pricing and Execution Milestones

 

 

 

 

Part 2: AMI Deployment Pricing

 

 

 

 

Part 3: DA Deployment Pricing

 

 

 

 

Part 4: DR Deployment Pricing

 

Exhibit C-1:

 

Statement of Work (AMI)

 

Exhibit C-2:

 

Statement of Work (DA)

 

Exhibit C-3:

 

Statement of Work (DR)

 

Exhibit C-4:

 

Statement of Work (Business Release)

 

Exhibit D:

 

Technical Specifications

 

Exhibit E:

 

System Acceptance and Test Plan Methodology

 

Exhibit F:

 

[Reserved]

 

Exhibit G:

 

Material Supply Plan

 

Exhibit H:

 

Integrated Meter Pricing and Specifications

 

Exhibit I:

 

Hiring Plan

 

Exhibit J:

 

Change Orders

 

Exhibit K:

 

Failure Analysis Report

 

Exhibit L:

 

Software Maintenance Terms and Conditions

 

Exhibit M:

 

Form of Escrow Agreement

 

Exhibit N:

 

Hardware, Software and Environments List

 

Exhibit O:

 

Training

 

Exhibit P:

 

[Reserved]

 

Exhibit Q:

 

Performance Metrics and Service Level Agreements

 

Exhibit R:

 

Integrated Project Master Schedule

 

Exhibit S:

 

Network Design Basis

 

Exhibit T:

 

Systems Integration / Interface Diagram Specifications

 

Exhibit U:

 

Security Framework and Requirements

 

Exhibit V-1:

 

Endpoint Installation Requirements (AMI)

 

Exhibit V-2:

 

Installation Requirements (DA)

 

Exhibit V-3:

 

Monthly and Cumulative Deployment Targets

 

Exhibit W:

 

Customer Engagement, Consumer Marketing and Customer Outreach

 

Exhibit X:

 

Solution ***

 

Exhibit Y:

 

RMA Process

2


 

 

Exhibit Z:

 

SaaS Overview

 

Exhibit AA:

 

Approved Electricity Metering Endpoints

3.

RULES OF CONSTRUCTION; DEFINITIONS.

 

3.1.

Rules of Construction.  The words “this Agreement,” “herein,” “hereby,” “hereunder” and “hereof,” and words of similar import, refer to this Agreement as a whole and not to any particular subdivision unless expressly so limited.  The words “this Section,” “this subsection” and words of similar import, refer only to the Sections or subsections hereof in which such words occur.  The word “or” is not exclusive, and the word “including” (in its various forms) means “including without limitation.”  Pronouns in masculine, feminine or neuter genders shall be construed to state and include any other gender, and words, terms and titles (including terms defined herein) in the singular form shall be construed to include the plural and vice versa, unless the context otherwise expressly requires.  Unless the context otherwise requires, all defined terms contained herein shall include the singular and plural and the conjunctive and disjunctive forms of such defined terms, and the term “Exhibit” shall refer to an Exhibit attached to this Agreement.  References to “days” shall mean calendar days, unless the term “Business Days” is used.  If the time for performing an obligation under this Agreement expires on a day that is not a Business Day, the time shall be extended until that time on the next Business Day.  References to “$” and “dollars” shall mean United States dollars.

 

3.2.

Definitions.  Capitalized terms used in this Agreement (including all Exhibits and Purchase Orders) shall have the meanings set forth in this Section 3.2; provided that each capitalized technical term used in an Exhibit or a Purchase Order that is not defined herein and that does not refer to SSN-specific technology shall be interpreted using the industry standard meaning of such term.  

Acceptance Criteria” means the mandatory requirements set forth in Exhibit E.

Acceptance Testing” means the procedure by which SSN and/or CPS Energy perform a series of tests (the criteria for which is set forth in Exhibit E) (the “Acceptance Tests”) to validate, measure and verify Product and Integrated Meter functionality.

Access Points” or “APs” means Equipment that acts as an interface between the NAN and the WAN that allows the UIQ Software to communicate with the Integrated Meter.

Agreement” has the meaning set forth in the signature page hereof.

AMI” or “Advanced Metering Infrastructure” means hardware and software that, along with communications services, enable automated meter reading and other capabilities.

AMI Endpoint” means Integrated Meters and Gas IMUs.

AMI Project” means the CPS Energy AMI project undertaken by the Parties under the SOW attached as Exhibit C-1.  The AMI Project includes all responsibilities assigned to the Parties, including the provision by SSN of all Products and Services and related Deliverables described in such SOW.

AMI System” means (A) the Integrated Meters and (B) the AMI products and technologies that SSN will provide, including: (i) the Back Office, (ii) WAN connections to/from Access Points, (iii) the NAN, exclusive of Bridges, and (iv) the data center infrastructure, facilities and environmental and power resources where the Back Office equipment is located in connection with the AMI Project.

Application for Payment Request” has the meaning set forth in Section 8.1.1.

Authorized Person” means *** and, solely as it relates to Change Orders and changes to SOWs pursuant to Section 7.4, ***.

3


 

Backhaul” means the WAN between the Access Points or Master Bridges and the data center (e.g., cellular 3G networks, broadband over power line (BPL), Wi-Fi, fibermux over Ethernet, etc.).

Back Office” means the GridScape System and/or the UIQ System, as applicable.

Bridge” means a Master Bridge or Remote Bridge.

Business Day” means a day other than Saturday or Sunday that banks in San Antonio, Texas or in Redwood City, California are generally open for business.

Business Release Services” means those services provided by SSN pursuant to the Statement of Work attached hereto as Exhibit C-4.

CGI Endpoint” means an AMI Endpoint that has not yet been installed due to a CGI Event (and which has not yet become a DUD Endpoint or an RTU Endpoint).

CGI Event” means, prior to completion of at least two documented field attempts on two separate days, two documented written attempts, and two documented telephone attempts in accordance with Exhibit V-1, the failure of SSN to install an AMI Endpoint due to the inability of SSN or its subcontractor to enter the End Customer’s premises or complete installation on such premises.

Change Order” has the meaning set forth in Section 5.5.

Code” has the meaning set forth in Section 14.5.

Communications Module” means SSN’s network communications device that is installed in Equipment, third-party devices and Integrated Meters, regardless of whether it is based on radio frequency technology (also referred to as a “NIC”) or cellular technology (also referred to as a “MicroAP”).

Confidential Information” has the meaning set forth in Section 10.1.

Conflict of Interest” has the meaning set forth in Section 21.17.1.

Contract Price” means, as of any specified time of determination, the aggregate amount paid and payable by Customer to SSN under all Purchase Orders, Change Orders and Statements of Work, and amendments and supplements thereto, entered into under this Agreement as of such time.

Customer” or “CPS Energy” has the meaning set forth in the signature page hereof.

Customer Content” means all text, data, pictures, sound, graphics, video and other information owned by Customer or its third-party licensors and used by Customer in conjunction with the Software.

Customer Engagement Services” means the customer engagement, consumer marketing, and customer outreach services provided by SSN, as described in Exhibit W.

Customer Indemnitees” has the meaning set forth in Section 15.1.1.

Customer Inspection Period” has the meaning set forth in Section 9.2.1.1.

Customer-installed Endpoints” has the meaning set forth in Section 13.13.

Customer-owned Derivative Works” has the meaning set forth in Section 11.2.2.1.

Customer Support Team”, “Customer Support Representatives” or “CSR” means the SSN’s team of technical support specialists who provide Software Support Services and Solutions Services to Customer.  

4


 

DA” or “Distribution Automation” means the remote and automated control of an electricity distribution network.

DA Communication Network” means Access Points, Relays, DA Endpoints and the wireless mesh network established as a result of the Equipment running SSN’s UtilOS Software.  To the extent that Access Points or Relays belonging to the network for CPS Energy’s AMI System are present, such Access Points and Relays are only considered part of the DA Communication Network if they are enabled to transport DA-related communications including DA data traffic as well as Bridge management traffic.

DA Device” means the combination of (i) distribution equipment that performs either a power control or monitoring purpose (such as a recloser, capacitor bank, line sensor, etc.), and (ii) a Remote Terminal Unit that provides electronic controls for such a distribution device (such as a capacitor bank controller).

DA Endpoint” means any Bridge provided by SSN or an SSN-certified third-party IED containing a Bridge or Communications Module.

DA Project” means the DA Communication Network project undertaken by the Parties under the SOW attached as Exhibit C-2.  The DA Project includes all responsibilities assigned to the Parties, including the provision by SSN of all Products and Services and related Deliverables described in such SOW.

DA System” means a Distribution Automation System, which is the remote and automated control and monitoring of an electricity distribution network that SSN will provide to CPS Energy, including the Access Points, Relays, DA Endpoints, and the wireless mesh network established as a result of the Equipment running Silver Spring's UtilOS Software.

Deliverable” means all Software, Derivative Works, Work Product and Documentation, whether tangible or intangible, which are detailed in an SOW, and which are produced by SSN under this Agreement.

Delivery Date” means (i) for Equipment, the date on which Customer or Customer’s designee receives the Equipment, F.O.B. Delivery Point (provided, that such delivery may be deemed to occur earlier as described in the final sentence of Section 9.2.1.1); (ii) for Software operated by Customer, the date on which SSN makes the Software available to Customer; and (iii) for Software that SSN operates on Customer’s behalf under Solutions Services, the date on which the Software is first installed and operational on the server(s).  

Delivery Point” has the meaning set forth in Section 5.3.

Deployment Period” means the period that begins with the installation of the first Access Point or Relay and continues through the installation of the last Integrated Meter that is Optimized under the applicable SOW and the achievement of all Execution Milestones.

Derivative Works” means a Work Product or other Deliverable based on SSN Intellectual Property Rights, which may be Customer-owned or SSN-owned, including: (i) for material subject to copyright protection, any work which is based upon one or more pre-existing SSN works, such as a revision, modification, translation, abridgment, condensation, expansion, collection, compilation or any other form in which such pre-existing works may be recast, transformed or adapted; (ii) for patentable or patented materials, any adaptation, subset, addition, improvement or combination of any Product, Service or Confidential Information of SSN; and (iii) for material subject to trade secret protection, any new material, information or data relating to and derived from the pre-existing SSN Confidential Information.

Developed Software” means the software, including the Source Code, developed specifically for Customer by SSN pursuant to this Agreement or identified in an SOW as such, and owned by Customer in accordance with Section 11.  For the avoidance of doubt, Developed Software excludes Third-Party Software and Licensed Software.  

Disclosing Party” has the meaning set forth in Section 10.1.

5


 

Discontinued Product” has the meaning set forth in Section 5.8.1.

Disputes” has the meaning set forth in Section 21.12.

Diverse” means, with respect to a business, that such business is a certified or classified business that meets one or more of the following criteria as defined by the Bexar County Small, Minority and Women-Owned Business Administration:  Minority Business Enterprise, Woman Business Enterprise, Small Business, Veteran-Owned Small Business, Service Disabled Veteran-Owned Small Business, Small Disadvantaged Business and/or Historically Underutilized Business (HUB) Zone Certified Business.

DNP” means Distributed Network Protocol; “DNP3” is a version of this protocol.

DNP 3.0 Compliant” means that a Bridge provided as part of the DA System transmits and receives DNP 3.0 compliant traffic.

Documentation” means an electronic version of the then-current user manuals and documentation that SSN provides with the applicable Product to Customer.

DR” means Demand Response, and is used to describe the software, hardware and programs related to the deployment and operation of HAN Devices in conjunction with SSN’s HAN Communications Manager application, the NAN and the HAN.

DR Program means the DR project undertaken by the Parties under the SOW attached as Exhibit C-3.  The DR Program includes all responsibilities assigned to the Parties, including the provision by SSN of all Products and Services and related Deliverables described in such SOW.

DR System” means the combination of Integrated Meters with SSN DR technologies and HAN Communications Manager (HCM) supporting Customer’s Demand Response system, but only to the extent the technology is provided by SSN.

DUD Endpoint” means an AMI Endpoint that SSN is obligated to return to Customer (i) following completion of at least two documented field attempts on two separate days, two documented written attempts, and two documented telephone attempts in accordance with Exhibit V-1 or (ii) following Customer’s request pursuant to Exhibit V-1.

Economic Development Milestones” has the meaning set forth in Section 4.2.

ED Breach” has the meaning set forth in Section 4.3.

ED Certification Date” has the meaning set forth in Section 4.3.

ED Shortfall” means:

(i) with respect to any ED Breach consisting of SSN’s failure to pay a specified dollar amount (or a minimum dollar amount) by a specified date, such specified dollar amount minus the amount actually paid by SSN as of such date;

(ii) with respect to any ED Breach consisting of SSN’s failure to, per Section 4.2.1.2, hire employees for the SSN San Antonio Office in accordance with the hiring schedule set forth in the Hiring Plan, an amount equal to (A) the number of employees required to be employed by SSN at the SSN San Antonio Office as of the specified date minus the number of employees actually employed by SSN at the SSN San Antonio Office as of the specified date, multiplied by (B) forty thousand dollars ($40,000); and

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(iii) notwithstanding anything to the contrary in the immediately preceding clauses (i) and (ii), with respect to any ED Breach consisting of SSN’s failure to perform its obligations under Section 4.2.5, an amount determined in accordance with Section 4.2.5.

Educational Fund Donation Plan” has the meaning set forth in Section 4.2.3.

Effective Date” means February 13, 2013 and refers to the original effective date of that certain Master Agreement between the Parties, dated as of February 13, 2013.

End of Life Date” has the meaning set forth in Section 5.8.1.

End Customer means a customer (residential, governmental, or commercial) of CPS Energy.

Endpoint Management Fees” means the fees for “Endpoint Management” described in Section 3 (Engagement Management and Deployment Services) of Exhibit B, Part 2.

Endpoints” means AMI Endpoints and DA Endpoints.

Engagement Manager” means SSN’s employee responsible for managing the delivery of all Services to CPS Energy and to whom various SSN project managers will report.

Equipment” means all hardware and related ancillary items, including Access Points, Communications Modules (including those that may be integrated into Integrated Meters), Endpoints (including, for the avoidance of doubt, SSN Integrated Meters and the components thereof, but excluding Third-Party Integrated Meters and the electricity metering endpoints in such Third-Party Integrated Meters) and Relays, SSN provides to Customer under this Agreement pursuant to Purchase Orders and Change Orders, including any Replacement Product consisting of Equipment, and as more fully described in Exhibits B, C, and H.

Error” means a material failure of the Licensed Software and Developed Software to perform in accordance with its Technical Specifications, its Documentation and other technical and functional requirements set forth in this Agreement.  Errors do not include, and subject to Section 13.4 (including the exceptions cited therein), SSN shall have no responsibility for, any failure of the Licensed Software and Developed Software caused by any of the following:  (i) any material alterations or modifications not made or approved by SSN; (ii) misuse or abuse, including the failure to operate the Licensed Software and Developed Software in accordance with SSN’s installation and operating instructions found in the applicable Documentation, including on computing devices or with computer operating systems and/or third-party software other than those recommended by SSN in writing; (iii) the Licensed Software and Developed Software has been damaged in any manner due to the intentional or wrongful acts of any person; (iv) Customer fails to reasonably assist SSN in verifying, reproducing and correcting error conditions as required under Exhibit L; or (v) any failure of the computer operating systems, hardware environment and/or third-party software used by Customer; in the case of each of clauses (i) through (v), to the extent not caused by SSN or SSN’s subcontractors.

Escrow Agent” means NCC Group, Inc., a Virginia corporation, or such other party as mutually agreed upon by the Parties.

Escrow Agreement” has the meaning set forth in Section 14.1.

Escrow Deposits” has the meaning set forth in Section 14.1.

Escrow License” has the meaning set forth in Section 14.2.

Execution Milestones” means those items listed in the “milestones” column in Exhibit B, Part 1.

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Excusable Delay” means (i) a delay caused by a Force Majeure event; (ii) a delay directly and exclusively caused by Customer, or by Customer’s consultants, agents, contractors or other parties contracting with Customer in connection with the Project; (iii) suspension for convenience by Customer; (iv) a delay caused by the removal of personnel by Customer other than as provided in Section 20.2; or (v) any other delay agreed by the Parties to be an Excusable Delay.

Existing Litigation” means (i) EON Corp. IP Holdings, LLC v. Landis + Gyr, et. al, 6:11-cv-00317-LED-JDL (E.D. Tex. filed June 17, 2011); and (ii) TransData, Inc. v.  Oklahoma Gas & Electric, CIV-11-1032-C (W.D. Okla. filed Sept. 16, 2011).

Extended Software Support” has the meaning specified in Section 1.10 of Exhibit L.

Fees” means all amounts due to SSN by Customer for Products and Services under this Agreement as set forth in Exhibit B and, with respect to Training Services only, Exhibit O.

Field Network” means Endpoints, Relays, Access Points and the wireless mesh network established as a result of the Equipment running SSN’s UtilOS Software.  

Field Network Design means a design created by SSN that identifies the number and proposed locations of Relays, Bridges and Access Points that will be required for the deployment area, based on the number, density and coverage area of Endpoints, RF mesh bandwidth requirements and acceptance criteria.  The Field Network Design is dependent upon information that CPS Energy provides under the applicable SOW.

Field Tests” means the field tests identified in Exhibit E for Equipment deployed in an area of CPS Energy’s service territory.

Firmware” means the object code version of SSN proprietary software that is embedded in the Equipment.

Firmware Support Services” means the maintenance and support services for Firmware that SSN shall provide to Customer hereunder, as described in the applicable SOW.

Fix” means, in SSN’s discretion, either a hot fix designed to correct an Error or Patch Release supplied by SSN, or implementation of an operational procedure by Customer to diminish or avoid the effect of the Error.

F.O.B.” means free on board destination, freight prepaid.

Force Majeure” has the meaning set forth in Section 18.5.

Future Law Changes” has the meaning set forth in Section 5.7.1.

Gas IMU” means SSN’s gas interface management unit, including the battery used therein.  

Gas IMU Integration Milestone” means the item identified on Exhibit X as “CPS Gas Meter Retrofits for Silver Spring Gas IMU.”

General Terms and Conditions” has the meaning set forth in the preamble hereof.

GridScape” means SSN’s software application, which comprises a central network management system that provides a real-time and historic view into the health and status of the Bridge communication network and its devices.

GridScape System” means SSN’s GridScape network management system, including servers, Licensed Software and the following network and application components: (i) routers terminating IPSEC/RFC2893 tunnels; (ii) VPN tunnel (or other circuit) connecting CPS Energy to a GridScape environment; and (iii) a data center infrastructure (including network, power and facilities).

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HAN” means Home Area Network, which is a network that enables communication between the Integrated Meter and one or more HAN Devices.

HAN Devices” means third-party devices that are owned by CPS Energy or End Customers, and are or will be connected to the HAN at End Customers’ premises.  HAN Devices include range extenders, programmable communicating thermostats (PCTs) and required accessories (e.g., wall plates, aux switches), in-premise displays (also known as in-home displays or IHDs) and load control devices (LCDs), smart appliances, prepayment terminals and electric vehicle supply equipment (EVSEs), which are also known as EV charging stations.  For purposes of this Agreement, HAN Devices are assumed to be (i) ZigBee Smart Energy Profile 1.0 certified or certified at a level as the Parties mutually agree; and (ii) unless otherwise noted, certified by SSN to operate with SSN’s energy services portal residing on the Communications Module in the Integrated Meter.

Hiring Plan” has the meaning set forth in Section 4.2.1.2.

Hiring Plan (Temporary Employees)” has the meaning set forth in Section 4.2.2.

Hosted Personnel” has the meaning set forth in Section 20.1.1.

IM Countable Event” means, with respect to an individual Third-Party Integrated Meter Failure, that a mutually agreed upon third-party engineering firm selected in accordance with Section 13.14.1.2 *** the Third-Party Integrated Meter Failure (*** Customer’s Third-Party Meter Provider agree that such Third-Party Integrated Meter Failure***), *** of the Third-Party Integrated Meter Failure to *** of the Third-Party Integrated Meter Failure *** of the applicable Third-Party Integrated Meter(s).

IM Countable Event Threshold” means, as of a specified date of determination and as to the applicable measurement period described in Section 13.14.1.6, and with respect to a quantity of Third-Party Integrated Meters, the greater of (a) *** and (b) a number equal to *** of the total number of Third-Party Integrated Meters then installed or in Customer’s inventory.

Incident” means an event occurring that is an unplanned loss or degradation of service of the NAN, Backhaul, UIQ or Firmware.

Indemnitee” has the meaning set forth in Section 15.2.1.

Indemnitor” has the meaning set forth in Section 15.2.1.

Independent Auditor” has the meaning set forth in Section 9.5.2.

Inspection Period has the meaning set forth in Section 5.4.

Installation Fees” means the fees for “Installation Services” described in Section 3 (Engagement Management and Deployment Services) of Exhibit B, Part 2.

Installation Services” has the meaning set forth in Section 20.3.

Integrated Meters” means SSN Integrated Meters and Third-Party Integrated Meters.

Integration Services” means the work performed by SSN and its contractors required for the AMI solution, as defined in the AMI SOW, as well as Exhibit T.

Intelligent Electronic Device” or “IED” means a device that provides electronic controls for a distribution device, to which the Remote Bridge is connected.  The IED provides a weather-proof enclosure for the Remote Bridge as well as DC or AC power.  

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Intellectual Property Rights” means all worldwide common law or statutory (i) patents, patent applications and patent rights; (ii) rights associated with original works, authorship, moral rights, copyrights and all its exclusive rights; (iii) rights relating to the protection of trade secrets and confidential information; (iv) rights associated with algorithms, designs, industrial designs and semi-conductor design; (v) rights related to the possession, use or exploitation of signs, trademarks, service marks, trade names, trade dress and related goodwill; (vi) rights analogous to those set forth above and any and all other industrial or intellectual property rights; and (vii) registrations, divisionals, continuations, continuations-in-part, renewals, reissues, reexaminations and extensions of the foregoing (as applicable) now existing or hereafter filed, issued or acquired.

Key Personnel” means SSN’s Engagement Manager, Project Managers, System Integration Manager/Lead, and Lead Developer/Integration Solution Architect.  

Lab Tests” means the tests the Parties will perform to prove the effectiveness of the Logical Network Reference Design and set forth in Exhibit E.  

Landis + Gyr” means Landis + Gyr, Technology, Inc., a Delaware corporation (formerly known as Cellnet Technology, Inc.).

Letter Agreement” has the meaning set forth in Section 21.3.

License Fees” means the fees payable by CPS Energy to SSN for the Software as more particularly identified in Exhibits B-2, B-3 and B-4.

Licensed Software” means (i) any SSN proprietary software; (ii) associated Documentation; (iii) Firmware; (iv) third-party software embedded in any SSN proprietary software; and (v) Replacement Product consisting of Software, in each case licensed by SSN to Customer in accordance with this Agreement.  

Lien” means any lien, mortgage, security interest, pledge, charge or encumbrance.

Local” means, with respect to a business, that such business has significant operations in Customer’s service territory and is located in any of ***.  For purposes of this definition, a business has significant operations in Customer’s service territory if (i) it is headquartered, has its primary office of operations or has a local branch office within Customer’s service territory, (ii) it has all required licenses to conduct its operations within Customer’s service territory and (iii) it has operated within Customer’s service territory for a period of twelve (12) consecutive months.

Logical Network Reference Design” means the design of the DA Communication Network for communicating with CPS Energy’s DA Devices, based on CPS Energy’s connectivity and security requirements as expressed in Exhibit C-2.

Major Release” means a new release of Licensed Software supported by SSN that adds features and functionality improving overall product performance, efficiency and usability.  Major Releases are denoted by a change in the digit number of the release to the left of the decimal point (e.g., 1.5 to 2.0).

Managed Services” means the services SSN provides when managing the Licensed Software at a Customer data center.

Material Supply Plan” means the supply plan as agreed to by the Parties, an example of which is set forth in Exhibit G, as the same may be updated by the Parties from time to time, which addresses the Parties’ expectations and procedures regarding the forecasting, ordering and management of all materials supplied under this Agreement.

Master Bridge” (sometimes referred to as a “head-end Bridge”) means a Bridge serving as a hub device for communicating distribution-grid ***.

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Minimum Aggregate Donation” has the meaning set forth in Section 4.2.3.

Minor Release” means a new Licensed Software release supported by SSN that impacts overall product performance, efficiency and usability.  Minor Releases are denoted by a change to the tenths decimal number of the release (e.g., 1.5 to 1.6).

NAN means Neighborhood Area Network, which is a network comprised of all communicating components within a distribution domain such as smart meters located at homes and businesses as part of a mesh communication network.

Network Design Basis” has the meaning set forth in Section 4.1.5.

New Energy Innovation Center and Incubator Fund” means a center and/or fund to be established by one or more entities working in collaboration with Customer for the purposes of creating and implementing educational programs, understanding and placing on exhibit innovative clean energy and other technologies, and serving as a forum for the exploration of various ways in which to protect our environment and help businesses and other consumers produce and use energy more wisely.                

Optimization” means (i) for DA, the procedure by which the Field Network Design, Equipment configuration and implementation have been validated (“Optimized”) by performing active and passive tests to confirm that performance and redundancy meets the design specifications set forth in Exhibit S, and (ii) for AMI, after initial Integrated Meter installation exceeds ninety-five percent (95%) completion in a specified area and all Access Points and Relays required by the enhanced Field Network Design for such area have been installed and validated.  Optimization is executed when scheduled by the Parties after initial installation of Equipment and Integrated Meters is complete in a specified area, and it may include the provision by SSN of additional Equipment as required for achieving the required performance and redundancy.

Party” or “Parties” means SSN and Customer, as applicable.

Patch Release” means a Licensed Software release that provides Error fixes, and is denoted by a change to the hundredths decimal number of the release (e.g., 1.5.2 to 1.5.3).

“***” means a *** for the benefit of Customer *** of SSN hereunder, including any and all ***, that is (i) ***, (ii) in a form ***, and (iii) issued by ***.

P.O. Release” means a release of Equipment pursuant to a Purchase Order.

Pre-existing SSN IPR” has the meaning set forth in Section 11.2.2.2.

Products” means all Equipment and Licensed Software and Developed Software sold or licensed by SSN to Customer under this Agreement.

Project” means, collectively, the Products and Services to be provided by SSN to Customer under this Agreement in connection with the planning, design, initial implementation, Acceptance Testing, full deployment and ongoing monitoring, and maintenance of the Systems, and including the economic development projects undertaken by SSN in accordance with this Agreement.  The Project includes all responsibilities assigned to SSN and to Customer and any SOWs, including the manufacture, delivery, installation, and integration of Equipment, and the delivery of all Services and related deliverables described in the Statements of Work attached as Exhibit C-1 – C-4.  

Project Management and Deployment Services” means SSN’s project management services for project coordination and deployment of the Project, including the services contemplated in Sections 4.1.2, 13.2.6, 13.2.7 and 13.14 and the design, configuration, installation and Optimization of each System, as more fully described in the Statements of Work, the Project Schedule and Exhibits V-1 and V-2.

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Project Manager” means the person charged by Customer with the day-to-day management of the Services to be provided to Customer under this Agreement.  The initial Project Manager shall be Martha Mitchell.  Customer may from time to time designate a replacement Project Manager by written notice to SSN.

Project Schedule” means the Integrated Project Master Schedule as agreed to by the Parties, an excerpt of which is attached hereto as Exhibit R, as the same may be updated by the Parties from time to time.

Provisioned Integrated Meter” means an Integrated Meter that is located in an area of the NAN and which is in any of the following operational states within the UIQ System: “active,” “inactive,” or “disconnected,” and which has been Optimized, but which is not: (i) in a “discovered,” “installed,” “initializing,” “unreachable” (to the extent not caused by Silver Spring or any of its Subcontractors) or “init_failed” state; or (ii) considered to be in the process of being deployed.

Purchase Order” has the meaning set forth in Section 5.1.1.

Purpose” has the meaning set forth in Section 14.2.

Questions means Customer’s requests for general technical support or information.  

Receiving Party” has the meaning set forth in Section 10.1.

Records” has the meaning set forth in Section 9.5.2.

Relay” means SSN’s wireless receiver that routes and forwards information through the SSN mesh network.

Release Event” has the meaning set forth in Section 14.3.

Remote Bridge” means a Bridge that is installed in a ***.  

“***” means an ***.

Replacement Product” has the meaning set forth in Section 5.8.2.

Response Time” means the period commencing when an incident is logged and ending when SSN provides Customer with an acknowledgement thereof.

RF” means radio frequency.

RTU Endpoint” means an AMI Endpoint that SSN classifies as “returned to utility” and assigns back to Customer following the failure of SSN to install such AMI Endpoint due to a safety hazard, equipment breakage or failure, or any other reason mutually agreed upon by the Parties.

SaaS” or “Software as a Service” means the services (more particularly described in Exhibit Z, and which shall include those particular environments and modules identified in Exhibit N) provided by SSN pursuant to Exhibit C-1, where SSN operates Licensed Software on SSN servers at an SSN data center.

SCADA” means Supervisory Control and Data Acquisition.

Second A&R Master Agreement” has the meaning set forth in the Preamble.

Security Changes” has the meaning set forth in Section 5.7.3.

“***” means the ***, as set forth in Exhibit Q.

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Services” means Project Management and Deployment Services, Solutions Services, Integration Services, Software Support Services, Business Release Services, Training Services requested by Customer pursuant to Section 4.1.4, and Customer Engagement Services.

Software” means all Licensed Software, Developed Software and Third-Party Software described in the applicable SOW.  

Software Support Services” means the support and maintenance services described in Exhibit L, which SSN shall provide to Customer in accordance with this Agreement, which includes the Firmware Support Services.

Software Support Services Fees” means the Fees payable by Customer for Software Support Services, including Firmware Support Services, as set forth in Exhibit B.

Solutions Services” means (i) SaaS and (ii) Managed Services.

Solutions Services Fees” means the Fees payable by Customer for Solutions Services, as set forth in Exhibit B.

Source Code” means the human readable source code which:  (i) will be narrated documentation related to the compilation, linking, packaging and platform requirements and any other materials or software sufficient to enable a reasonably skilled programmer to build, modify and use the code within a commercially reasonable period of time, as authorized by this Agreement; and (ii) can reasonably be compiled by a computer for execution.

Statement of Work” or “SOW” means each of the statements of work for the AMI System, the DA System and the DR System attached as Exhibits C-1 – C-3, the statement of work attached hereto as Exhibit C-4, and any subsequent statements of work entered into by SSN and Customer under this Agreement.  

SSN” or “Silver Spring” has the meaning set forth in the signature page hereof.

SSN Incubator Investment” has the meaning set forth in Section 4.2.4.

SSN Indemnitees” has the meaning set forth in Section 15.1.2.

SSN Integrated Meter” means an SSN Meter provided by SSN directly to CPS Energy and into which a Communications Module has been integrated.

SSN Meter” means the electricity metering endpoints provided directly to SSN by a third-party electricity meter provider (which, as of the date hereof, is contemplated to be General Electric) and used in SSN Integrated Meters.

SSN San Antonio Office” has the meaning set forth in Section 4.2.1.1.

Subcontractors” has the meaning set forth in Section 9.5.2.

Systems” means, collectively, the AMI System, the DA System and the DR System, and, each, a “System.”

System Acceptance” means the Products and Services (other than those Services that, by their nature, are ongoing) provided by SSN under this Agreement, and the Integrated Meters, have undergone the applicable System Acceptance Test to validate that they work as a System and have met all applicable Acceptance Criteria.

System Acceptance Test Plan” means the System Acceptance Test Plan for each System set forth in Exhibit E.

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System Acceptance Testing” means, with respect to each System, the conducting of Lab Tests and Field Tests to validate performance of such System after installation thereof.

Technical Specifications” means the technical specifications for the Products set forth in Exhibit D.

Term” has the meaning set forth in Section 17.1.

Tester” means (i) where a Third-Party Integrated Meter has been submitted to a third-party engineering firm as contemplated by Section 13.14.1.2, such firm and (ii) otherwise, the applicable Third-Party Meter Provider.

Third-Party Integrated Meter” means an electricity metering endpoint provided by Customer’s Third-Party Meter Provider directly to CPS Energy and into which a Communications Module has been integrated.

Third-Party Integrated Meter Failure” has the meaning set forth in Section 13.14.1.1.

Third-Party Meter Provider” means each of Customer’s third-party electricity meter providers, which, as of the date hereof, is contemplated to include Landis + Gyr, that provide electricity metering endpoints directly to CPS Energy.

Third-Party Products” mean any proprietary hardware developed by third parties that SSN provides to Customer hereunder and that is not embedded in any Product and Third-Party Software.

Third-Party Software” means any proprietary software developed by third parties that SSN provides to Customer hereunder and that (i) is not embedded in any Licensed Software or Developed Software and (ii) is licensed directly to Customer by such third parties.

Tools” has the meaning set forth in Section 11.2.2.2.

Training Services” means those training courses and bundles provided by SSN and described in Exhibit O.

Update(s)” means Major Release, Minor Release or Patch Release that SSN makes generally available to its customers who have purchased Software Support Services (or similar services), regardless of the version name or number; provided, however, that Updates shall not include stand-alone, plug-in or add-on software products or modules licensed separately that contain new features and functionality for which SSN charges separate license and Software Support Services Fees.

Updated Escrow Deposits” has the meaning set forth in Section 14.1.

U.S.” or “United States” means the United States of America.

User ID” has the meaning set forth in Section 11.1.2.

UtilityIQ® Software”, “UIQ Software”, “UIQ” or “UtilityIQ” means the object code version of SSN’s UtilityIQ software.

“***” means SSN’s ***.

VPN” means a Virtual Private Network, a secure LAN-to-LAN tunnel based on the IPSEC protocol, used to connect Customer and SSN networks providing access to the UIQ System from Customer’s corporate location(s).

WAN” means a Wide Area Network, which is the network supporting communications between the Access Points and the routers terminating IPSEC/RFC2893 tunnels.

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Work Product” means the tangible Deliverables developed by SSN and delivered to Customer under this Agreement as described in an applicable SOW, including programs, listings, printouts, documentation, notes, flow charts and programming aids.  

4.

AGREEMENT TO SELL AND PURCHASE PRODUCTS AND SERVICES; ECONOMIC DEVELOPMENT MILESTONES.

 

4.1.

Agreement to Sell and Purchase Products and Services.  

 

4.1.1.

The Parties shall update and revise the Material Supply Plan and Project Schedule as mutually agreed from time to time.  SSN agrees to sell or provide, as applicable, to Customer, and Customer agrees to purchase from SSN, the Products and Services subject to and in accordance with these General Terms and Conditions, Exhibit B, including the Execution Milestones set forth in Exhibit B, Part 1, the Statements of Work set forth in Exhibit C-1 – C-4, and the Project Schedule.

 

4.1.2.

SSN hereby agrees that it shall, on an ongoing basis, determine and notify Customer in writing as to the number of Integrated Meters that may be required in connection with the Project from time to time and, with Customer’s prior approval, coordinate Customer’s orders of Integrated Meters. Additionally, in consideration for Customer’s agreement to purchase certain electricity metering endpoints directly from one or more Third-Party Meter Providers (and to take delivery of Third-Party Integrated Meters from such Third-Party Meter Provider(s)), SSN hereby agrees that it shall, on an ongoing basis, (a) with Customer’s prior approval, coordinate Customer’s orders of electricity metering endpoints to be incorporated into such Third-Party Integrated Meters from Customer’s Third-Party Meter Provider at least *** before such Third-Party Integrated Meters are required and (b) determine and notify Customer in writing as to the number of Communications Modules that may be required in connection with Third-Party Integrated Meters from time to time and ensure that Customer has the appropriate number of Communications Modules in inventory at Customer’s Third-Party Meter Provider’s site as may be required for integration into electricity metering endpoints ordered by Customer or in connection with warranty-related repair or replacement of Third-Party Integrated Meters or the Communications Modules contained therein. SSN shall ensure that before coordinating Customer’s placement of orders for electricity metering endpoints, SSN has available for sale to Customer the requisite number of Communications Modules to incorporate into such electricity metering endpoints. The Parties acknowledge that Customer is purchasing certain Communications Modules under this Agreement for integration by Customer’s Third-Party Meter Provider into Third-Party Integrated Meters.  To the extent Customer elects to have such Communications Modules purchased by Customer delivered to Customer’s Third-Party Meter Provider, SSN shall coordinate directly with such Third-Party Meter Provider as to the delivery by SSN of all such Communications Modules, and shall ensure that the timeline for (x) delivery of such Communications Modules by SSN to the Third-Party Meter Provider, (y) installation thereof by the Third-Party Meter Provider, and (z) delivery of the Third-Party Integrated Meters by such Third-Party Meter Provider to Customer’s designated site, is consistent with the Project Schedule. SSN shall also provide warranty-related and other services related to Integrated Meters as further described in Sections 13.2 and 13.14.

 

4.1.3.

Intentionally Omitted.

 

4.1.4.

If Customer requests any Training Service, SSN shall provide such Training Service in accordance with Exhibit O.

 

4.1.5.

Attached hereto as Exhibit S is the design basis for the Project network (the “Network Design Basis").  Following the Effective Date, the Parties will work together to plan and design such network based upon the Network Design Basis.  If, in the course of proving

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and disproving the correctness of elements thereof, the Parties determine that the design contemplated thereby requires material scope changes in order to meet Project objectives, the Parties shall consider in good faith any equitable adjustments to the Fees set forth in Exhibit B, Part 2 and Part 3 that are warranted as a result thereof.

 

4.1.6.

Attached hereto as Exhibit X is a *** consistent with Exhibit X.  *** described in Exhibit B, Part 1), *** in accordance with Exhibit X.

 

4.2.

Economic Development Milestones.  Notwithstanding anything in this Agreement to the contrary, Customer’s obligations under this Agreement are subject in all respects to SSN’s achievement of the following (the commitments set forth in Section 4.2.1 through Section 4.2.5, collectively the “Economic Development Milestones”) in the timeframe and in the manner set forth below.  Accordingly, SSN hereby covenants as follows: 

 

4.2.1.

***.

 

4.2.1.1.

SSN shall, not later than ***, the core function of which will be the ***.  The Parties acknowledge that other technical and operations functions will be *** at the SSN *** performing such functions count as part of the SSN ***.  SSN shall make a *** in connection with *** (in the aggregate, including all ***, and SSN shall not apply for, *** similar in nature to the SSN *** may otherwise be eligible.

 

4.2.1.2.

Set forth in Exhibit I is SSN ***, which contains SSN’s *** at the SSN  *** by SSN to *** to be located at the SSN *** consistent with the functions of the SSN *** described in Section 4.2.1.1, *** over the next *** for such *** into which such ***. SSN shall meet the *** at the SSN ***.  The duties of the employees of the SSN *** shall not include the provision of Services hereunder. 

 

4.2.1.3.

Customer agrees and acknowledges that all *** by SSN to be located at the SSN *** shall be subject to SSN ***.  If, pursuant to and in accordance with the terms of this Agreement, there is any extension or substantial delay of the timeline set forth in the Project Schedule, the Parties shall meet and attempt in good faith to determine whether the *** set forth in the *** shall also be extended.

 

4.2.2.

Temporary, Full-Time Employees.  Also included in Exhibit I is SSN’s hiring and staffing plan (the “Hiring Plan (Temporary Employees)”) for temporary, full-time employees that will perform installation and professional Services hereunder.  SSN shall (i) meet the timeframe in the Hiring Plan (Temporary Employees) for hiring and staffing such temporary, full-time employees and (ii) employ no fewer than *** of the San Antonio, Texas workforce in temporary, full-time jobs in the areas of installation and professional Services provided to Customer hereunder in accordance with the hiring schedule set forth in the Hiring Plan (Temporary Employees).  The obligation of SSN set forth in this Section 4.2.2 shall, for the avoidance of doubt, be independent of any obligation of SSN set forth in Section 4.2.1.  Customer agrees and acknowledges that the number of temporary, full time jobs required by this Section 4.2.2 is subject to adjustment if there is any extension or substantial delay of the timeline set forth in the Project Schedule.  Any such adjustment may be effected only with Customer’s approval, such approval not to be unreasonably withheld, conditioned or delayed.

 

4.2.3.

Educational Fund.  SSN shall, not later than December 31, 2024, donate a minimum of *** (the “Minimum Aggregate Donation”) in funds to educational institutions selected by Customer, as an irrevocable gift for charitable and educational purposes.  By August 30, 2016, SSN shall provide Customer with an educational fund donation plan for such Minimum Aggregate Donation (the “Educational Fund Donation Plan”) (which shall require SSN to donate a minimum of ***, beginning with 2016, until such time as SSN has made the Minimum Aggregate Donation) for review and approval by Customer, such

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approval not to be unreasonably withheld, conditioned or delayed. SSN shall make the Minimum Aggregate Donation in accordance with the Educational Fund Donation Plan. 

 

4.2.4.

Incubator Fund.  SSN shall invest a total of *** (“SSN Incubator Investment”) in the New Energy Innovation Center and Incubator Fund, in accordance with that certain Renewable Innovation Center Development Agreement between the Parties, dated January 1, 2015. From and after the Effective Date, SSN shall exercise its commercially reasonable efforts to assist Customer in recruiting additional partners and investors to participate in the New Energy Innovation Center and Incubator Fund.

 

4.2.5.

Internships.  During each of the *** beginning with 2014 (i) SSN shall make good faith efforts to provide paid internships to students who have received funds as established in Section 4.2.3 above and enrolled at the educational institutions selected by Customer, (ii) SSN shall make good faith efforts to provide at least *** such student internships per year, and (iii) SSN shall pay not less than a total amount of *** to student interns.  If SSN does not, pursuant to this Section 4.2.5, pay to its interns an aggregate amount of *** during any calendar year, then at the conclusion of such calendar year, *** set forth in, this Section 4.2) an amount equal to *** during such calendar year pursuant to this Section 4.2.5. For the avoidance of doubt, (x) any amount paid by SSN *** in pursuant to this Section 4.2 ***.  

The payment and performance obligations of SSN set forth in Sections 4.2.1 through 4.2.5 shall, for the avoidance of doubt, be independent of any other payment or performance obligation of SSN under any other provision of this Agreement.

 

4.3.

ED Certification.  Starting on December 31, 2016, on each June 30 and December 31 during the Term (each, an “ED Certification Date”), SSN shall provide to Customer a certificate from an officer of SSN certifying (i) to the full and complete performance by SSN of all obligations in respect of Economic Development Milestones that, per Sections 4.2.1 through 4.2.5, SSN is required to have performed by the date of such certification or (ii) if such SSN officer is unable to so truthfully certify, as to the obligations in respect of Economic Development Milestones that SSN has (and those that it has not) performed as of such date.  If, in any such certification, SSN indicates (or should have indicated pursuant to the immediately preceding sentence) that SSN has failed to perform any obligation in respect of any Economic Development Milestone that SSN is, per Sections 4.2.1, 4.2.3, 4.2.4, or 4.2.5, obligated to perform on or before such ED Certification Date (each, an “ED Breach”), ***.  SSN shall promptly notify Customer in the event SSN remedies an ED Breach.  If Customer receives from SSN any such notice in respect of an ED Breach prior to the ED Certification Date immediately following the ED Certification Date on which such ED Breach was disclosed, Customer shall promptly pay to SSN any amounts previously withheld by Customer in respect of the corresponding ED Shortfall.  If Customer does not receive from SSN any such notice in respect of an ED Breach prior to the ED Certification Date immediately following the ED Certification Date on which such ED Breach was disclosed, Customer’s payment obligation in respect of the corresponding ED Shortfall shall be fully and finally extinguished.  The exercise by Customer of its right to withhold any ED Shortfall pursuant to this Section 4.3 shall not, for the avoidance of doubt, relieve SSN of any obligation to which such ED Shortfall relates; provided, however, that the permanent retention by Customer of the Shortfall shall serve as liquidated damages for that relevant ED Milestone with respect to the applicable ED Certification Date and shall be Customer’s sole and exclusive remedy for the Shortfall, but only with respect to such ED Certification Date; for the avoidance of doubt, such liquidated damages shall not relieve SSN of its obligations under such ED Milestone as they relate to other ED Certification Dates.  

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5.

ORDERING, FORECASTING, SHIPMENT AND ACCEPTANCE OF EQUIPMENT.

 

5.1.

Purchase of Equipment.

 

5.1.1.

During the Term of this Agreement, Customer shall order Equipment (the purchase of which shall include, at no additional cost to Customer, a non-exclusive, perpetual, royalty-free, license to use the Firmware in the Equipment) from SSN in accordance with the Project Schedule and otherwise in accordance with this Agreement through the issuance of purchase orders and P.O. Releases specifying the type and quantity of Equipment ordered, the shipment destination, the requested delivery date, any specific packaging and/or shipping instructions applicable to the Equipment ordered and any other applicable information (each such purchase order or P.O. Release, a “Purchase Order”).  If any Purchase Order purports to modify the General Terms and Conditions, then such terms must be agreed to by the Parties in writing and, in the case of Customer, executed by an Authorized Person as set forth in Section 21.13.

 

5.1.2.

Unless otherwise set forth in the Project Schedule, SSN shall not be obligated to deliver Equipment pursuant to a Purchase Order prior to the date that ***.

 

5.1.3.

Each Purchase Order shall be accepted by SSN in writing ***; provided that SSN shall have the right to ***.

 

5.2.

Forecasts.  

 

5.2.1.

At SSN’s request, Customer will work with SSN to develop a written inventory ordering and inventory management process that provides reasonable forecasting and reasonable assurance of supply.  ***.  All forecasts are for planning purposes only and are non-binding upon Customer.

 

5.2.2.

Promptly following the Effective Date, SSN shall work in good faith with Customer to create a supply chain analysis applicable to the Project.  SSN shall update such analysis at least once annually.

 

5.3.

Shipment.  SSN shall ship all Equipment (in each case, with the serial number of the various items of Equipment included in such shipment set forth in the documentation accompanying such shipment) F.O.B. to a single location within Customer’s service territory to be specified by Customer in the applicable Purchase Order (or to such other location as may be specified in a Change Order if signed by an Authorized Person and by SSN upon acceptance thereof); provided that, notwithstanding the foregoing, (i) Customer may designate a separate location for the delivery of Communications Modules to be integrated into Third-Party Integrated Meters, which location may be Customer’s Third-Party Meter Provider (the “Delivery Point”), (ii) Customer shall *** on or before *** shall be deemed satisfied upon SSN’s receipt *** for all Equipment ordered on or after ***, Customer shall pay the ***. SSN shall deliver the Equipment to Customer on or, with Customer’s written consent, before the requested delivery date set forth in the Purchase Order.  If SSN cannot deliver the Equipment on or before the requested delivery date, then SSN shall, as soon as it becomes aware of any actual or potential delay, inform Customer thereof in writing in accordance with Section 18.1.  The Equipment shall be packaged and labeled in a manner appropriate for the shipment method, unless special packaging and/or labeling requirements are specified in the Purchase Order, in which case the Equipment shall be so packaged and labeled.  *** specified in Section 9.2.1.1, *** as described in Section 9.2.1.1, *** or more as described in the final sentence of Section 9.2.1.1, for reasons other than SSN’s *** for such Third-Party Integrated Meters shall pass to ***.

 

5.4.

Inspection and Acceptance or Rejection.  Customer or its designee (which, in the case of Communications Modules to be integrated into Third-Party Integrated Meters, may be Customer’s

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Third-Party Meter Provider) may inspect the Equipment (a) with respect to Equipment other than Communications Modules to be integrated into Third-Party Integrated Meters, within *** and (b) with respect to Communications Modules to be integrated into Third-Party Integrated Meters, *** to Customer of the Third-Party Integrated Meters into which ***, and which may also be for the purpose of *** into Third-Party Integrated Meters, may be Customer’s Third-Party Meter Provider) as promptly as practicable following the ***.  Upon notice by Customer to SSN within the Inspection Period, SSN agrees to provide all missing Equipment, replace all damaged or incorrect Equipment and deliver, at SSN’s expense, additional or replacement Equipment in order to meet the correct quantities.  Such deliveries shall (i) in the case of supplemental Equipment (excluding SSN Integrated Meters), be completed within *** from the receipt by SSN of Customer’s notice, and in the case of supplemental SSN Integrated Meters, be completed as soon as reasonably practicable (***); and (ii) in the case of replacement Equipment (excluding SSN Integrated Meters), be completed ***; provided, that, for the avoidance of doubt, nothing in this Section 5.4 shall relieve SSN from any of its obligations contained in this Agreement with respect to meeting Execution Milestones.  Customer’s acceptance of Equipment in the applicable shipment shall occur after the last day of the Inspection Period (unless Customer timely notified SSN of any damaged, incorrect or missing Equipment) or, if earlier, upon receipt by SSN of Customer’s written acceptance of such Equipment.  Customer’s acceptance of Equipment as provided in this Section 5.4 shall not prejudice any rights of Customer set forth in this Agreement, including, for the avoidance of doubt, any rights set forth in Section 13.

 

5.5.

Change Orders. Customer may request to change a Purchase Order pursuant to Exhibit J, which changes may include the expansion or reduction of the scope of such Purchase Order, at any time by issuing to SSN a request for change order in the form attached as Attachment 1 to Exhibit J (each, a “Change Order”).  If the requested Change Order results in no change in the cost of performance or time for delivery of the Equipment ordered therein, then SSN shall agree to such Change Order and perform in accordance therewith.  If the requested Change Order results in either an increase or decrease to the cost of performance or a shortening or expansion of the time for delivery of the Equipment ordered therein, then SSN shall, ***, provide to Customer its good faith estimate, together with reasonable supporting documentation, of an equitable adjustment to the price set forth in the Purchase Order in connection therewith.  Customer shall have the right to dispute any price adjustment proposed by SSN.  No Change Order will be effective until signed by or on behalf of each Party and, if applicable, in accordance with Section 21.13.  

 

5.6.

Order Cancellations.  Customer may, at no charge, cancel all or part of a Purchase Order by written notice to SSN at least *** prior to the scheduled shipping date for the cancelled portion of the Purchase Order.  Customer may cancel all or part of a Purchase Order *** prior to the scheduled shipping date for the cancelled portion of such Purchase Order by paying twenty-five percent (25%) of the amount that would otherwise be paid for full delivery of the cancelled portion of such Purchase Order.  Customer may cancel all or part of a Purchase Order *** prior to the scheduled shipping date for the cancelled portion of such Purchase Order by paying *** of the amount that would otherwise be paid for full delivery of the cancelled portion of such Purchase Order. Customer may not cancel any portion of a Purchase Order *** prior to the scheduled shipping date for such portion of the Purchase Order.  If Customer attempts to cancel all or part of a Purchase Order *** prior to the scheduled shipping date therefor, then, regardless of whether Customer accepts delivery of the cancelled Equipment, ***.  If Customer pays any amount to SSN under this Section 5.6, then ***.  Notwithstanding anything herein to the contrary, in the event this Agreement is terminated for any reason other than by SSN pursuant to Section 17.2 or 17.3, ***.  *** under this Section 5.6 *** in accordance with Section 17.7.

 

5.7.

Changes in Products

 

5.7.1.

SSN represents and warrants that the Systems, ***, will comply with ***, and all applicable laws, regulations and governmental standards.  SSN shall, subject to Customer’s reasonable approval (***) use commercially reasonable efforts to, as promptly as

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practicable, bring the Systems into compliance as mandated by such laws, regulations or standards (***).  *** under Section 5.7 ***.

 

5.7.2.

Subject to Section 5.7.4, the costs associated with Future Law Changes and Security Changes shall be allocated between the Parties as follows ***.  

 

5.7.3.

SSN shall, subject to Customer’s approval (and, where applicable, Customer’s agreement to bear its specified share of associated costs) use commercially reasonable efforts to, as promptly as practicable, ***.  

 

5.7.4.

If the changes in laws, regulations, or standards, or the security or integrity concerns giving rise to the Future Law Changes or Security Changes, as applicable, disproportionately affect SSN (or the Products) as compared to other businesses (or products or equipment) in the utilities or energy industries in the United States, ***.

 

5.7.5.

In effecting any Future Law Changes or Security Changes, SSN shall ensure that the performance and functionality of the Products and the Systems are not compromised from what has been agreed upon in this Agreement.  As long as functionality of the Products, Systems, or Integrated Meters is not impaired, SSN shall have sole discretion as to the remediation or remedy implemented to effect the change required hereunder.

 

5.8.

End of Life.

 

5.8.1.

Subject to Section 5.8.2, SSN may cease production of Equipment (each, a “Discontinued Product”) upon advance written notice to Customer that is at least *** before the last delivery date (the “End of Life Date”) for such Discontinued Product.  Customer may issue a final Purchase Order for any Discontinued Product up to *** before the End of Life Date.  

 

5.8.2.

SSN shall make available to Customer, ***, of the Discontinued Product.  ***.

6.

ORDERING SOFTWARE.

 

6.1.

Purchase Orders.  During the Term of this Agreement, Customer shall order Software from SSN as set forth in this Agreement through the issuance of Purchase Orders, and the process for ordering Equipment set forth in Sections 5.1, 5.5 and 5.6 shall also be used for the ordering of Software.  

 

6.2.

Delivery of Software.  SSN will deliver the Licensed Software and Documentation by electronic download or install the Software and deliver the Documentation in accordance with the applicable SOW.  Except as provided in an SOW or an agreement governing Software Support Services, Customer, at its own expense, will be responsible for installing the Software, including any Updates to which Customer is entitled.  SSN will deliver Firmware embedded in the Equipment and Firmware Updates by electronic delivery.  SSN will deliver Software under SaaS to Customer by providing Customer with passwords or other authentication credentials for authorized users and a URL for web access to the Software.

7.

ORDERING SERVICES.

 

7.1.

SOWs.  During the Term of this Agreement, SSN shall perform the Services as set forth in this Agreement and as more particularly specified in the SOWs in a timeframe and manner to meet the Execution Milestones and Project Schedule.  SSN shall diligently and timely perform such Services under each SOW (i) in a prudent industry manner and (ii) using skilled employees, subcontractors or other agents having the appropriate background and skills to perform the Services hereunder.  All of such Service providers shall at all times remain under the direction and control of SSN.  To the extent not set forth in this Agreement, SSN shall, with the consent of Customer, such consent not to

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be unreasonably withheld, conditioned or delayed, be entitled to determine the methods, details and means of performing such Services for Customer.

 

7.2.

Contacts.  Customer’s Project Manager and SSN’s Engagement Manager shall, respectively, serve as the primary contact for the other Party for the performance of the Services hereunder.  Each Party shall direct all Service-related inquiries and requests to the other Party’s Project Manager and Engagement Manager, as applicable.  

 

7.3.

Use of Facilities.  SSN shall perform the Services at the location set forth in the applicable SOW. Customer shall grant SSN and its subcontractors reasonable access to Customer’s facilities as necessary for SSN personnel to perform the Services, with, if Customer so elects, the escort of Customer personnel and subject to all applicable Customer health, safety, environmental and security procedures.

 

7.4.

Changes to SOW.  If either Party proposes a change to a SOW, then the other Party will reasonably and in good faith consider and discuss with the other Party the proposed change.  SSN agrees to accept any change proposed by Customer that is documented in writing, ***.  In order to be effective, the change to the SOW must be documented in a form executed by or on behalf of each Party and, if applicable, in accordance with Section 21.13.

 

7.5.

Software Support Services.  During the Term of this Agreement, SSN shall provide to Customer the Software Support Services applicable to such System.

 

7.6.

Transition Services.  If, after the Deployment Period, Customer desires to transition from the use of SaaS to another software delivery model, SSN agrees to coordinate and cooperate in good faith with Customer with respect to developing a plan for and providing transitional services with respect thereto.  Any such transitional services shall be subject to a separate SOW and mutually agreed-upon fees.

 

7.7.

Permits and Licenses.  SSN shall obtain and maintain all necessary permits, licenses, inspections and any other forms of documentation required relating to the Products and Services provided hereunder ***.  Upon request, SSN shall promptly furnish Customer copies of all permits, licenses or other documentation applicable to this Agreement.

 

7.8.

GAS IMU Integration.  On or before the date that is *** after the Effective Date, SSN shall have achieved the Gas IMU Integration Milestone.  Within ***, SSN shall have ensured that the number of Gas IMUs set forth in the applicable Purchase Order are ready for installation into Customer’s Systems and that all SSN personnel and subcontractors to be involved in the installation of the Gas IMUs have completed all necessary training with respect thereto.  

 

7.9.

Integration with Customer Property and Facilities.  In performance hereunder, SSN shall not misuse; operate in a manner not in compliance with applicable training materials, manuals or specifications; neglect, modify or otherwise cause damage to; expose to adverse conditions; or compromise or impair the functionality of any equipment, property, software or facilities owned by or licensed to Customer.

 

7.10.

Installation Services.  

 

7.10.1.

SSN shall *** (a) in accordance with Exhibit V-1 (and Customer shall perform those duties that are expressly assigned to Customer in such Exhibit V-1) and (b) in accordance with the monthly and cumulative installation obligations set forth in Exhibit V-3.  ***.

 

7.10.2.

SSN shall *** in accordance with Exhibit V-2 (and Customer shall perform those duties that are expressly assigned to Customer in such Exhibit V-2).

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8.

EXECUTION MILESTONE ACCEPTANCE; SYSTEM ACCEPTANCE.

 

8.1.

Execution Milestone Acceptance.  

 

8.1.1.

Immediately upon the completion of each Execution Milestone, SSN shall provide to Customer (to the extent not already provided to Customer as part of the achievement of such Execution Milestone) all Software and Deliverables required by such Execution Milestone and ***    

 

8.1.2.

Customer shall have *** to perform the applicable Acceptance Tests and other testing to determine whether the Software and Deliverables so provided in connection with such Execution Milestone materially conform to the Technical Specifications and the applicable Documentation, and to determine whether SSN has completed all steps required of the applicable Execution Milestone.  In the event that the ***, or that SSN has not ***, Customer shall promptly notify SSN, and SSN shall *** to ensure that it will so ***.  Thereafter, Customer shall have a ***.  

 

8.1.3.

Customer shall *** when Customer accepts SSN’s achievement of an Execution Milestone and all Software and Deliverables delivered therewith, and ***.  In the event *** to which Section 8.1.2 ***, shall be deemed accepted by Customer, and thereafter SSN shall be ***.

 

8.2.

System Acceptance.  Following the installation of each System, SSN shall perform the applicable System Acceptance Testing in conformance with the applicable System Acceptance Test Plan in the timeframe and in the manner set forth in Exhibit E in order to determine whether such System meets the Acceptance Criteria. SSN shall notify Customer of the results of any System Acceptance Test (including SSN’s assessment as to whether the applicable System meets the Acceptance Criteria) promptly after completion thereof, together with reasonable supporting documentation.  In the event that *** in accordance with Section 17.2; provided, however, *** Customer’s Third-Party Meter Provider *** contemplated by Exhibit D.

9.

FEES; PAYMENT TERMS; TAXES.

 

9.1.

Fees.  SSN’s Fees for the Products and Services, as reflected in all Purchase Orders, Change Orders and SOWs entered into hereunder, shall (except with respect to Training Services) be as set forth in Exhibit B.  SSN’s Fees for Training Services shall be as set forth in Exhibit O.  SSN’s Fees for the Third-Party Products shall be as set forth in the applicable SOW.

 

9.2.

Payment Terms.

 

9.2.1.

SSN shall invoice Customer as follows:

 

9.2.1.1.

For Equipment other than Communications Modules to be integrated into Third-Party Integrated Meters, *** Third-Party Integrated Meters ***:   Customer may within *** of Third-Party Integrated Meters *** of such Third-Party Integrated Meters for the purpose of *** in accordance with Section 5.5) (***).  If, as to a delivered shipment of Third-Party Integrated Meters, Customer does not provide to SSN written acknowledgement of acceptance, or a reasonably detailed notice regarding any damaged and/or incorrect quantities within the applicable ***, SSN may, ***, issue an invoice for the number of *** into the ***.  However, if Customer *** of Third-Party Integrated Meters *** its Third-Party Meter Provider ***, SSN shall be entitled to issue invoices upon the date on which such delivery was originally scheduled to occur prior to Customer’s *** into Third-Party Integrated Meters *** as specified in Section 9.2.2 below (it being understood that nothing in this Section 9.2.1.1 shall be construed to ***.

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9.2.1.2.

For Software, ***, as listed in Exhibit B, Part 1; provided that *** in accordance with Section 8.1.

 

9.2.1.3.

For Services (***), in accordance with Section 8.1.

 

9.2.1.4.

Customer shall pay ***.

 

9.2.1.5.

For Training Services, in accordance with Exhibit O.

 

9.2.2.

Each invoice shall set forth in reasonable detail the Fees requested, and the Equipment and/or Services provided by SSN to Customer, in connection therewith.  Invoices for Equipment must reference the applicable CPS Energy Purchase Order number or will be returned to SSN unpaid.  Subject to Section 9.3, Customer shall pay each invoice *** under Section 5.4 (*** into Third-Party Integrated Meters, ***); ***, and subject to Section 9.2.1.2, ***.  SSN shall submit *** SSN shall be ***.

 

9.3.

***.  

 

9.3.1.

Customer may *** (as such terms are defined in Exhibit L) *** to the extent SSN has not yet *** as required by Section 19.1 *** as required by Section 21.19.1.  ***.

 

9.3.2.

If, at any time, *** made by SSN pursuant to Section 4.1.2 ***Customer’s Third-Party Meter Provider *** shall, for purposes of Section 18.1, *** from SSN *** (*** by SSN on SSN ***) until such time as (i) SSN has submitted to Customer *** SSN has come into *** to SSN ***.  

 

9.3.3.

*** pursuant to this Section 9.3 (***). *** pursuant to this Section 9.3 *** pursuant to this Section 9.3 if Customer agrees with *** by SSN in regard to ***.

 

9.4.

Taxes.  CPS Energy is a political subdivision of the State of Texas organized pursuant to Texas law codified at Chapter 1502 of the Texas Government Code and, as such, is a TAX-EXEMPT ORGANIZATION. CPS Energy is exempt from certain sales and use taxes with respect to the purchase price of all materials, supplies, equipment and consumables purchased under a separated contract (including the Equipment, Software and Services) and which are incorporated into the Services.  SSN shall not invoice or charge CPS Energy for such taxes and shall be provided with a Sales Tax-Exemption Certificate upon request.  Failure by SSN to request a Sales Tax-Exemption Certificate shall not mean that CPS Energy waives its tax-exempt status. CPS Energy shall not pay any taxes for which it is exempt.

 

9.5.

Audit Rights.  

 

9.5.1.

Upon written request by SSN, not more frequently than once annually, Customer shall furnish SSN with a letter signed by an officer of Customer verifying that Customer is using the Software in compliance with this Agreement.

 

9.5.2.

Upon reasonable prior notice, SSN shall make available, and shall cause those (i) subcontractors that provide Services directly to Customer, (ii) contract manufacturers that provide Products , and (iii) subcontractors that provide Services at Customer’s or any End Customer’s respective properties or sites (collectively, “Subcontractors”) to make available their respective books, records, correspondence, accounting procedures and practices and any other supporting evidence directly relating to this Agreement (all the foregoing hereinafter referred to as “Records”) for examination, audit and/or reproduction, during normal business hours, no more than *** annually, by the Independent Auditor or its authorized representative, to the extent ***.  Upon written request by Customer, not more frequently than twice annually, SSN will provide to Customer a certificate from an

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officer of SSN certifying that (i) there is no claim, suit or proceeding against SSN or, the knowledge (after reasonable inquiry) of SSN, any of the Subcontractors, that does or could reasonably be expected to affect Customer, the Project, or the transactions contemplated by this Agreement, and, to SSN’s knowledge (after reasonable inquiry), there exist no facts or circumstances that could reasonably be expected to result in such a claim, suit or proceeding, and (ii) SSN is, and to the knowledge (after reasonable inquiry) of SSN, the Subcontractors are, in compliance with all laws and regulations that do or could reasonably be expected to affect Customer, the Project, or the transactions contemplated by this Agreement.  Notwithstanding anything herein to the contrary, SSN shall, at Customer’s request, furnish directly to Customer Records and information of SSN and of the Subcontractors; provided that SSN and Subcontractors may redact any confidential or sensitive identifying information of any their respective customers contained therein prior to providing such information to Customer.  ***. The “Independent Auditor” shall be an independent auditing firm not affiliated with either Party and reasonably acceptable to both Parties, or, in the event the Parties are unable to agree on an independent auditing firm within ten (10) days of receipt by SSN of Customer’s notice of intent for an audit or inspection to be conducted, ***. For the purpose of ***. In addition, *** in accordance with this Section 9.5.2.

 

9.5.3.

SSN shall maintain its Records (updated promptly and consistently) in accordance with good accounting practices and prudent industry practices with regard to the procurement and provision of Products by SSN, the performance of Services by SSN and SSN’s use of subcontractors in respect thereof.

 

9.6.

***.  ***.

10.

CONFIDENTIALITY.

 

10.1.

Confidential Information.  “Confidential Information” means any confidential, trade secret or other proprietary information disclosed by one Party (the “Disclosing Party”) to the other (the “Receiving Party”) under this Agreement, including the terms of this Agreement, and any information provided in or delivered pursuant to a Purchase Order, SOW or Change Order.  To be subject to this Section 10, such information (which may include software) must be (i) designated with the legend “Confidential” or a comparable legend in case of disclosure in written, graphic, machine readable or other tangible form, or (ii) designated orally as “Confidential” at the time of disclosure in case of disclosure in oral, demonstrative or other non-tangible form. Confidential Information is not subject to this Section 10 if it: (a) is now or subsequently becomes generally available to the industry through no fault or breach of the Receiving Party, (b) was rightfully in the Receiving Party’s possession, or known by it, prior to receipt from the Disclosing Party; (c) was rightfully disclosed to the Receiving Party by a third party, free of any obligation of confidence, or (d) was developed by the Receiving Party independently and without reference to Confidential Information of the Disclosing Party.

 

10.2.

Restrictions.  Each Receiving Party shall use the Disclosing Party’s Confidential Information only to fulfill its commitments and exercise its rights under this Agreement.  Each Party agrees not to disclose any Confidential Information of the other Party to anyone other than those employees, agents, advisors, independent auditors or contractors of the Receiving Party who need to know such Confidential Information for the purposes of this Agreement and who are bound by obligations of confidentiality substantially and substantively similar to the obligations set forth herein. Each Receiving Party shall treat all Confidential Information of the Disclosing Party with the degree of care it accords to its own Confidential Information, but not less than reasonable care.  Neither Party shall reverse engineer, disassemble or decompile any prototypes, firmware, software or other tangible objects which embody the other Party’s Confidential Information and which are provided to such Party hereunder.

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10.3.

Mutual Cooperation.  Each Party will notify and cooperate with the other Party in enforcing the Disclosing Party’s rights if such Party becomes aware of a threatened or actual violation of the confidentiality requirements of this Section 10.

 

10.4.

Required Disclosures.  The Receiving Party may disclose the Disclosing Party’s Confidential Information pursuant to any statutory or regulatory authority or court order, or request of any governmental body with jurisdiction, provided that, to the extent permitted by law, the Receiving Party shall provide the Disclosing Party with reasonable written notice prior to any such disclosure, assist (at the Disclosing Party’s expense) in obtaining an order protecting the information from disclosure or otherwise protecting such Confidential Information, and comply with any applicable protective order or equivalent issued by a court or other governmental body with jurisdiction.

 

10.5.

No Limitation.  Nothing in this Agreement shall, or is intended to, limit either Party’s ability to develop or enhance its products and services in any manner whatsoever, including use of knowledge gained as a result of the performance by either Party of its obligations hereunder, provided that in so doing neither Party shall use the other Party’s Confidential Information in violation of the terms of this Section 10.

 

10.6.

Non-Disclosure of Agreement Terms.  Neither Party shall disclose the terms and conditions of this Agreement without the prior written consent of the other Party except that each Party may (notwithstanding the provisions of Section 10.2): (i) make such disclosures as are necessary to comply with applicable laws, rules and regulations or as necessary to enforce this Agreement, (ii) disclose the terms of this Agreement to such Party’s auditors, attorneys, bankers or investment bankers as necessary for their rendition of services to a Party, (iii) disclose that Customer is a customer of SSN, (iv) disclose the terms and conditions of this Agreement as and to the extent necessary (A) to enable any Third-Party Meter Provider to perform contract administration (including in relation to Communications Module delivery, Communications Module repair and replacement, and warranties relating to Third-Party Integrated Meters and the components thereof, including Third-Party Integrated Meter testing) or similar coordination duties for the benefit of Customer, or (B) to enable SSN to contract with various providers of SSN Meters and to support SSN’s provision of SSN Integrated Meters to Customer under this Agreement; provided that SSN may not, without prior written consent of Customer, disclose the pricing terms of this Agreement, or (v) make such disclosures to a third-party engineering firm as and to the extent necessary to enable SSN to fulfill its obligations hereunder or Customer to enforce its rights hereunder or under Customer’s contract with its Third-Party Meter Provider; provided, that such engineering firm has entered into a non-disclosure agreement containing terms at least as restrictive as those in Section 10 of this Agreement.

 

10.7.

Non-Disclosure of End Customer Information.  SSN shall not disclose (i) the identity, address, meter number or other identifying number or any other identifying information of any End Customer, (ii) any data or information with respect to electricity or gas usage by or demand of any End Customer or (iii) any other information pertaining to End Customers.

 

10.8.

Customer Network Access.  SSN may have access to certain Confidential Information on Customer’s computer systems, networks and databases solely for the purpose of performing the Services.  SSN agrees that access for other purposes, or the use of Customer’s network to access any other system, network or database, is strictly forbidden and that SSN is responsible and liable for all damages or unauthorized access resulting from such actions.  Without limiting Customer’s rights under Section 10.9, Customer reserves the right, in its reasonable discretion, to terminate SSN’s access to, and use of, Customer’s computer systems, networks and databases at any time, without notice to SSN, if Customer believes, in good faith, that SSN or any of its employees, subcontractors or agents has breached, or is likely to breach, this Section 10.8.

 

10.9.

Breach of Terms.  Each Party acknowledges that in the event of breach, or threatened breach, under this Section 10, the Disclosing Party’s remedy at law may be inadequate, and that the damages flowing from such breach might not be readily susceptible of being measured in monetary terms.

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Accordingly, in the event of either Receiving Party’s breach, or threatened breach of this Section 10, the Disclosing Party, in addition to any monetary damages, shall be entitled to seek immediate injunctive relief and may obtain a temporary order restraining any threatened or further breach without the posting of a bond or proof of monetary damages.

 

10.10.

Survival.  Except for Section 10.7, and as applied to Section 10.7, Section 10.9, the provisions of this Section 10 shall survive the expiration or earlier termination of this Agreement for a period of five (5) years.  The provisions of Section 10.7 and, as applied to Section 10.7, Section 10.9 shall survive the expiration or earlier termination of this Agreement indefinitely. Customer’s obligation to maintain the confidentiality of Licensed Software that is Confidential Information shall survive the expiration or earlier termination of this Agreement for a period of ten (10) years thereafter.  

11.

INTELLECTUAL PROPERTY RIGHTS.

 

11.1.

License Terms.  

 

11.1.1.

Grant.  Subject to the terms and conditions of this Agreement and payment of the applicable license Fees, SSN grants to Customer, solely for Customer's own internal business purposes in the U.S., a non-exclusive, non-transferable license to, without right to sublicense, to use ***.  Customer may make a reasonable number of copies ***.  Customer may make copies of the Documentation reasonably needed for to exercise its rights under this Agreement.  ***.

 

11.1.2.

Accessing Licensed Software. Each Customer employee, consultant or agent accessing Licensed Software through Solutions Services will be assigned a unique user identification name and password (“User ID”).  Customer shall be responsible for exercising its commercially reasonable efforts to ensure the security and confidentiality of all User IDs

 

11.1.3.

Restrictions. Except for Equipment provided by third parties, Equipment contains SSN’s Intellectual Property Rights and may not be incorporated into other products (other than as contemplated by this Agreement) without SSN’s prior written consent, which may be withheld in its sole discretion. For the avoidance of doubt, it is contemplated by the Parties that certain Communications Modules will be integrated into electricity metering endpoints by one or more Third-Party Meter Providers (including Landis + Gyr) authorized by SSN to so incorporate such Communications Modules. Except as otherwise set forth in this Agreement or permitted by SSN in writing, Customer shall not:  *** or any SSN *** to third parties, or otherwise use the ***; *** (f) except with respect to Customer’s *** (unless required by law, in which case, the provisions of Section 10.4 shall apply).  ***, nothing herein shall prevent Customer from *** by Customer, SSN, ***.

 

11.1.4.

Government End Users. If this license is acquired under a U.S. government contract, Customer acknowledges that the Software and associated documentation are “Commercial Computer Software”, as that term is defined in 48 C.F.R. 12.212 of the Federal Acquisition Regulations (FAR) and in 48 C.F.R. 227.7014(a)(i) of the Department of Defense Federal Acquisition Regulations Supplement (DFARS), and are provided with only the commercial rights, subject to the restrictions described in this Agreement.

 

11.2.

Ownership.  

 

11.2.1.

Customer Acknowledgment.  Customer acknowledges that, except as provided in this Agreement, including Section 11.2.2.1, SSN and its vendors and licensors, as applicable, retain all right, title and interest to all Intellectual Property Rights and all Confidential Information of SSN, and all copies thereof, and all Derivative Works based thereon.  SSN reserves all rights not expressly granted in this Agreement.

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11.2.2.

Ownership of Work Product and Derivative Works Developed under SOWs.  Ownership of the Intellectual Property Rights in any Work Product and any Derivative Works created by SSN or its subcontractors in performance of any SOW under this Agreement shall be allocated as follows:

 

11.2.2.1.

***.  Customer will ***.  Customer-owned *** include *** that are required to *** between SSN’s and Customer’s systems and, to the extent applicable, the Customer-owned ***.  To the extent any ***, SSN hereby ***.

 

11.2.2.2.

***.  Customer’s ownership of the *** under Section 11.2.2.1 shall be subject to SSN’s or the applicable subcontractor’s continued ownership of the ***.  Further, SSN shall retain ownership of any *** pertaining to SSN’s ***, provided however, that ***.  SSN hereby grants, and will ensure that its ***.  

 

11.2.2.3.

***.  SSN will own ***.

 

11.2.3.

Ownership of Content.  All Customer Content, including information concerning users, messages and other such data, constitutes Intellectual Property Rights of Customer, and SSN has no right to such Intellectual Property Rights except as expressly set forth in this Agreement.  Customer reserves all rights not expressly granted in this Agreement.  SSN shall, contemporaneously with the delivery to Customer of any Developed Software, deliver to Customer the Source Code for such Developed Software.

 

11.3.

Proprietary Markings and Copyright Notices.  Customer agrees not to remove or destroy any proprietary, trademark or copyright markings or notices properly placed upon or contained within any Products or Documentation.

 

11.4.

Data Privacy.  SSN will comply with all laws and regulations that may apply to SSN concerning the protection of any information (in any form) that identifies, or is reasonably capable of being identified with a particular End Customer (e.g., name, social security, account number or address) that:  (i) Customer provides to SSN; or (ii) is collected, created or disclosed to SSN by virtue of SSN’s performance of Services. SSN assumes no responsibility for Customer or third-party content carried on Customer’s systems. During the term of this Agreement, Customer shall have the legal right and authority to grant SSN access to view and use the End Customer data and Generated Data to provide Services, To Customer’s knowledge, SSN’s use of any such End Customer data and Generated Data in accordance with this Agreement will not violate any applicable laws or regulations or cause a breach of any agreement or obligation between Customer and any third party.  

12.

INFRINGEMENT.

 

12.1.

Intellectual Property Indemnities. To the extent permitted by law, SSN shall defend, indemnify and hold harmless the Customer Indemnitees from any and all ***.  The terms of Section 15.2 shall apply to the Parties with respect to such third-party claim.  SSN’s obligations under this Section 12.1 for any action shall apply to the extent that such action does not result from (i) the combination, operation or use of a Product with or in products or processes not provided or approved by SSN, provided, however, that SSN’s obligations under this Section 12.1 shall apply to any action to the extent it results solely from the combination, operation or use of a Product in conjunction with an electricity metering endpoint (as part of an Integrated Meter) or with any products, processes or infrastructure used by or on behalf of Customer, or otherwise contemplated in an SOW, as of the Effective Date, ***.

 

12.2.

SSN Options.  If a court or arbitrator determines that a Product, Integrated Meter or Service infringes or misappropriates the Intellectual Property Rights of a third party or enjoins the use of a Product, Integrated Meter or Service, then, SSN shall, ***.  If, after making all reasonable efforts, SSN is unable to comply with the immediately foregoing obligations under subparts (i) and (ii), ***.  

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SSN may also exercise the options as specified in the immediately preceding sentence above at any time after SSN’s receipt of *** pursuant to this Section 12.2 *** pursuant to Section 12.1.  ***.

 

12.3.

Exclusive Remedy.  THE RIGHTS AND REMEDIES SET FORTH IN SECTION 12.1 AND SECTION 12.2 CONSTITUTE THE ENTIRE OBLIGATIONS OF SSN AND THE EXCLUSIVE REMEDIES OF CUSTOMER WITH RESPECT TO THE MATTERS SET FORTH IN THIS SECTION 12.

13.

REPRESENTATIONS AND WARRANTIES.

 

13.1.

General.  As of the Effective Date:

 

13.1.1.

Due Authorization.  Each Party represents and warrants to the other Party that the individual executing this Agreement on behalf of such Party is duly authorized to execute this Agreement on behalf of such Party and to bind such Party hereby.  Each Party further represents and warrants to the other Party that this Agreement is a valid and binding obligation of such Party and enforceable against such Party in accordance with its terms (subject as to enforceability to those limitations imposed by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or affecting the enforcement of creditors rights generally and general principles of equity).

 

13.1.2.

Approval.  Each Party represents and warrants to the other Party that it has taken all requisite governmental, corporate, partnership or limited liability company action (as applicable) to approve the execution, delivery and performance by such Party of this Agreement.

 

13.1.3.

Litigation.  Except in the case of SSN, for the Existing Litigation, each Party represents and warrants to the other Party that there is no litigation or governmental proceeding or investigation pending or, to the knowledge of such Party, threatened against such Party, that may call into question the validity of this Agreement, or hinder this Agreement’s enforceability or the performance by such Party under this Agreement.  

 

13.1.4.

Violation of Law.  Each Party represents and warrants to the other Party that its execution of, and performance under, this Agreement does not and will not (i) violate applicable government codes, ordinances, laws, rules, orders, writs, regulations or restrictions, (ii) with or without notice or the passage of time, conflict with or result in a breach or violation of any of the terms, conditions or provisions of any contract or other agreement or instrument to which such Party is a party or by which it or its assets are bound, or constitute a default or cause for acceleration or termination thereunder, or result in the imposition of any Lien upon any of its assets.

 

13.2.

Equipment.  

 

13.2.1.

Equipment Warranty.  SSN warrants to Customer that all Equipment (which, for the avoidance of doubt, shall include***) shall be new *** with Section 5.4 (*** integrated into Third-Party Integrated Meters, *** the Third-Party Integrated Meters into which ***), conform in all material respects to all technical, functional and other specifications set forth in this Agreement (including the Technical Specifications) and its Documentation and be free from defects in design, materials and workmanship.  *** in accordance with Section 13.2.5.

 

13.2.2.

Remedy.  If any Equipment does not meet the warranty provided in Section 13.2.1, SSN shall ***; provided that, for the avoidance of doubt, ***; provided further that Customer

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has notified SSN of the ***, as applicable, pursuant to this Section 13.2.2, ***; provided that:

 

13.2.2.1.

*** provided in this Section 13.2,  *** the applicable Third-Party Integrated Meters in accordance with the provisions of Section 13.14.1 and *** of the applicable Third-Party Integrated Meters shall be determined in accordance with Section 13.14.1; provided that, subject to Section 13.14.1, ***, SSN shall only be *** provided in Section 13.2.5; and

 

13.2.2.2.

***.

SSN’s obligation to *** shall not be affected by a ***. Prior to delivery to Customer (or its designee), SSN will ***, as set forth in Section 13.2.1.  *** as set forth in Section 13.2.1 for the longer of the ***.  Except for the rights of Customer under Sections 13.2.5, 13.5.2, 13.14.1, and 15.1.1(i), this Section 13.2.2 shall be the ***.

 

13.2.3.

***.  *** provided in Section 13.2.1, *** by SSN only upon the *** not made or approved by SSN in writing; *** of Customer; *** not under SSN’s control; ***, respectively, is hereby approved by SSN for purposes of the foregoing limitations; provided that, in the case of Third-Party Integrated Meters, the ***  by Customer’s Third-Party Meter Provider in an *** approved by SSN; provided further that all *** generally available for use with SSN’s *** referenced in Exhibit H or Exhibit AA of this Agreement,***. For the avoidance of doubt, no warranty under this Agreement (as to Equipment or otherwise) shall be invalidated by *** with applicable specifications or into SSN Meters, *** of the Third-Party Integrated Meter or any component thereof or by SSN or its designee of the SSN Integrated Meter or any component thereof, (c) *** by Customer’s Third-Party Meter Provider of the Third-Party Integrated Meter or any component thereof or by SSN or SSN’s designee of the SSN Integrated Meter or any component thereof, (d) *** a Third-Party Integrated Meter or between the *** and the SSN Meter in an SSN Integrated Meter.

 

13.2.4.

***.  If Customer desires to *** described in Section 13.2, ***.  If Customer agrees to *** SSN shall diligently ***.  Warranties for Equipment repaired by SSN pursuant to this Section 13.2.4 shall be as mutually agreed by the Parties.

 

13.2.5.

***.  Customer may, ***.  

 

13.2.5.1.

*** shall be as set forth in Section 13.2.5.2.  In consideration for such ***, Customer shall ***.  Except with respect to ***, all ***.  An amount paid by Customer pursuant to this Section 13.2.5.1 shall, with respect to the applicable Equipment, entitle Customer to the warranty protections set forth in Section 13.2.5.2 for an ***.  Customer may, in its sole discretion, extend (subject to Section 13.2.5.3) any such warranty for additional ***; provided, that where Customer extends a warranty as to ***, SSN shall only be obligated to effect *** pursuant to Section 13.2.5.2 *** under Section 13.2.5.2 may be properly determined.  

 

13.2.5.2.

Without limiting any other right of Customer set forth in this Agreement, if, within any *** does  not conform in all material respects to all technical, functional and other specifications set forth in this Agreement (including the Technical Specifications) and its Documentation or is not free from defects in design, materials and workmanship, then, *** pursuant to Section 13.2.5.1 (***), SSN shall be obligated to *** (provided that, for the avoidance of doubt, all replacement Communications Modules shall be new or comparable in quality to the non-conforming Communications Modules) *** pursuant to Section 13.2.5.2) ***; provided that, in the case of *** SSN shall *** to Customer’s Third-Party Meter Provider the *** provided in this Section 13,

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*** the applicable Third-Party Integrated Meters in accordance with the provisions of Section 13.14.1 *** of the applicable Third-Party Integrated Meters shall be determined in accordance with Section 13.14.1.  For purposes of this Section 13.2.5.2, ***, SSN will ***, set forth in Section 13.2.1.  *** under this Section 13.2.5.2 shall be warranted as set forth in Section 13.2.1 for the ***; provided that, except as SSN may otherwise agree in writing, *** under this Section 13.2.5.2 shall not ***.

 

13.2.5.3.

Notwithstanding the foregoing provisions of this Section 13.2.5, SSN’s obligation under Section 13.2.5.2 in respect of any extended warranty purchased by Customer pursuant to Section 13.2.5.1 shall not (i) with respect to any *** under Sections 13.2.1 and 13.2.5.1) *** under Sections 13.2.1 and 13.2.5.1).

 

13.2.5.4.

Upon the expiration of any warranty provided hereunder by SSN for any item of Equipment, SSN shall, if such Equipment was manufactured by a party other than SSN, exercise its commercially reasonable efforts to cause to be assigned to Customer any warranty then remaining in respect of such Equipment.

 

13.2.6.

SSN Integrated Meter Inventory. SSN shall ensure that Customer has in inventory at all times a number of replacement SSN Integrated Meters sufficient to *** by the foregoing provisions of this Section 13.2. *** under any other provision of this Section 13.2 or under the provisions of Section 13.14.1, *** Customer pursuant to Section 5.4 ***.

 

13.2.7.

Continuing Management and Administration.  SSN shall, in consultation with Customer, take primary responsibility for coordinating with SSN’s provider of SSN Meters as to *** to the SSN Integrated Meters, ***.  In so doing, SSN shall exercise commercially reasonable efforts to (i) *** by Customer in connection therewith and (ii) effect any *** of SSN Integrated Meters in the manner ***.  SSN shall, upon request, assist Customer in activities relating to SSN Integrated Meters and shall keep Customer *** between SSN and SSN’s provider of SSN Meters, including as it relates to SSN Integrated Meter ***.  SSN shall cooperate in good faith with Customer and SSN’s provider of SSN Meters regarding the *** of SSN Integrated Meter *** SSN Integrated Meters and the components thereof, including SSN Integrated Meter *** set forth in this Section 13.2 and in Section 4.1.2, and all other services related to SSN Integrated Meters, have been *** of the SSN Integrated Meters set forth in Exhibit H and in the “SSN Integrated Meters” table of Exhibit B, Part 2, and Customer shall not be ***.

 

13.3.

Services.

 

13.3.1.

Services Warranty.  

 

13.3.1.1.

SSN hereby represents and warrants to Customer that it has substantial experience in the installation, testing, repair, replacement and maintenance of equipment identical (or substantially similar) to the Equipment and Integrated Meters and is fully qualified to perform the Services in accordance with the terms of this Agreement.

 

13.3.1.2.

SSN warrants to Customer that the Services will (i) be provided in accordance with all applicable laws, permits, manuals, policies of Customer, insurance policies and the Technical Specifications, designs and other requirements set forth in the applicable SOW and (ii) be performed by qualified personnel in a competent and professional manner in accordance with usual and customary industry standards.

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13.3.1.3.

***.

 

13.3.2.

Remedies.  Without limiting Customer’s rights under Section 15.1, if any Service does not meet a warranty provided in Section 13.3.1, SSN shall ***; provided that Customer has notified SSN of the existence of such non-conforming Service prior to the expiration of the warranty period for such Service.  *** pursuant to this Section 13.3.2 ***.  Re-performed Services will be warranted as set forth in Section 13.3.1.  

 

13.4.

Software.  

 

13.4.1.

Licensed Software and Developed Software Warranty.  SSN warrants to Customer that, for a period of ***, without prejudice to any other rights of Customer under this Agreement, the Licensed Software and the Developed Software will perform substantially in accordance with the Technical Specifications and the Documentation for the Licensed Software and the Developed Software, as applicable.   

 

13.4.2.

***.  Without limiting Customer’s rights under Section 15.1, if any Licensed Software or Developed Software does not meet the warranty provided in Section 13.4.1, SSN shall remove, repair, or at its option replace, and re-install such non-conforming Software; provided that Customer has notified SSN of the existence of such non-conforming Software prior to the expiration of the warranty period for such Software.  Without limiting any obligations of SSN, or rights of Customer, under Exhibit L, ***, by SSN pursuant to this Section 13.4.2 ***.  Repaired or replaced Licensed Software or Developed Software will be warranted as set forth in Section 13.4.1 ***.  Except for the rights of Customer under Sections 13.5.2 and 15.1.1(i), this Section 13.4.2 shall be the exclusive remedy to Customer *** described in Section 17.2).  Following the warranty period, Errors in the Licensed Software or Developed Software will be addressed under the Software Support Services program as purchased by Customer.  

 

13.4.3.

***.  The foregoing warranty shall not apply to ***.  For the avoidance of doubt, ***, SSN does not hereby provide a warranty in respect of ***.

 

13.4.4.

***.  SSN warrants to Customer that the Licensed Software, Third-Party Software (unless otherwise provided in the documentation provided by Third-Party manufacturer) and any Work Product provided under this Agreement shall not, at the time of transfer to Customer, include ***.  SSN will verify that the Licensed Software, Developed Software or Work Product does not contain any of the aforementioned matters immediately prior to shipment to Customer.

 

13.4.5.

Third-Party Warranties.  To the extent possible, SSN will pass through to Customer any warranties on any Third-Party Software provided by third parties or other supplier(s) of such software.  SSN shall have no obligation for any warranties or maintenance of the Third-Party Software.

 

13.5.

***.  

 

13.5.1.

***.  SSN hereby represents and warrants to Customer that during the Term of the Agreement, each *** (*** but excluding, without prejudice to *** under Section 13.14, *** and related services provided to ***) shall in all respects perform at and achieve all applicable Service Levels.

 

13.5.2.

***.  If, within any *** (*** provided to Customer by Customer’s Third-Party Meter Provider) ***, then SSN shall immediately notify Customer of ***.  SSN shall have *** in which to effect all such corrective measures.  *** under Section 13.14, *** provided to Customer by Customer’s Third-Party Meter Provider) ***, without prejudice to the other

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rights afforded Customer under this Agreement, have the right to *** (*** set forth in Section 17.2 ***). The obligations of SSN pursuant to Sections 13.5.1 and Section 13.5.2 shall apply only to the extent that, as of the applicable failure, *** (*** in accordance with the terms of this Agreement), *** in accordance with Exhibit L, ***.  

 

13.5.3.

***.  In the event any *** fails to operate in accordance with all applicable***, and in addition to all other obligations under this Agreement, *** the form attached hereto as Exhibit K.  

 

13.6.

DNP 3.0 Compliance.  SSN hereby represents and warrants to Customer that all Bridges provided as part of the DA System shall, upon delivery to Customer, transmit and receive DNP 3.0 Compliant traffic.

 

13.7.

Work Product.  SSN hereby represents and warrants to Customer that all Work Product shall, upon delivery to Customer, (i) be complete as defined by the Technical Specifications and (ii) have been created in accordance with the professional standards expected of any company performing similar integration and design services in the United States. 

 

13.8.

Documentation.  SSN hereby represents and warrants to Customer that (i) the Documentation has been created in accordance with the professional standards expected of any company providing similar documentation in the United States and (ii) SSN has, prior to the Effective Date, provided Customer with true and complete copies thereof.

 

13.9.

Invoices.  SSN hereby represents and warrants that, with respect to each invoice issued to Customer hereunder, (i) the Fees set forth therein are the true and correct amounts owed by Customer to SSN in respect of the Products and/or Services that are the subject of such invoice, (ii) all such Products and Services meet all applicable Technical Specifications and standards set forth in this Agreement, (iii) at the time such invoice is delivered to Customer, all Execution Milestones and required activities thereunder have been successfully achieved and performed by SSN, and (iv) all subcontractors of SSN providing products or services in connection with such Products and Services have been paid in full or will, upon receipt from Customer of the invoiced amount, be paid in full in accordance with all applicable subcontracts.

 

13.10.

Title.  Subject to Section 11.2, SSN hereby represents and warrants to Customer that Customer will receive good and valid title to all Equipment and Customer-owned Derivative Works, and a valid license to all Software delivered to Customer and all Services performed by SSN or at SSN’s direction, for Customer under this Agreement, free and clear of all Liens.  ***.

 

13.11.

***.  Subject to, and without limitation of, the exclusions set forth in Sections 13.2.3 and 13.4.3, SSN hereby represents and warrants to Customer that the Project as provided to and developed for Customer hereunder shall include the provision and development of all personnel, Equipment, intellectual property and services ***.  SSN hereby represents and warrants to Customer that the Systems (excluding Third-Party Integrated Meters but, for the avoidance of doubt, including the Communications Modules) as provided to and developed for Customer hereunder shall include all applicable security capabilities described in Exhibit U.

 

13.12.

Disclaimer of Implied Warranties.  EXCEPT FOR THE WARRANTIES PROVIDED IN THIS SECTION 13, (i) SSN MAKES NO WARRANTY OF ANY KIND, WHETHER EXPRESS, IMPLIED, STATUTORY OR OTHERWISE RELATING TO THE PRODUCTS OR SERVICES; (ii) SSN SPECIFICALLY DISCLAIMS ALL IMPLIED WARRANTIES OF DESIGN, MERCHANTABILITY, ***, TITLE AND IMPLIED WARRANTIES OF NONINFRINGEMENT ARISING UNDER THE UNIFORM COMMERCIAL CODE; AND (iii) SSN DOES NOT WARRANT OR REPRESENT THAT THE SOFTWARE WILL BE FREE FROM BUGS OR THAT ITS USE WILL BE UNINTERRUPTED OR ERROR-FREE, OR MAKE ANY OTHER REPRESENTATIONS REGARDING THE USE, OR THE RESULTS OF THE USE, OF THE PRODUCTS.

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13.13.

Customer-installed Endpoints.  The Parties acknowledge that Customer shall install ***.  Notwithstanding the fact that Customer, and not SSN, is installing the Customer-installed Endpoints, *** by Section 15.1.2(iii), *** under Section 15.1 and this Section 13 ***.

 

13.14.

Third-Party Integrated Meters.

 

13.14.1.

Third-Party Integrated Meter Failures.

 

13.14.1.1.

If, during the Deployment Period (or, if SSN is providing endpoint management services past the Deployment Period pursuant to an SOW, during the time set forth in such SOW), any Third-Party Integrated Meter is *** “Third-Party Integrated Meter Failure”), SSN or its designee shall, *** under Section 13.2, *** Third-Party Integrated Meter *** Third-Party Meter Provider (***) in accordance with the *** set forth in Exhibit Y, within *** of becoming aware of the ***, for testing in accordance with all such procedures and instructions as may be mutually agreed upon by such Third-Party Meter Provider and SSN acting in good faith and *** of such Third-Party Integrated Meter, *** Third-Party Integrated Meter ***. For the avoidance of doubt, SSN’s obligation to *** Third-Party Integrated Meter shall not be affected by a ***, and, unless expressly requested by Customer in writing, *** such Third-Party Integrated Meters***. Where one or more Third-Party Integrated Meters are returned to Customer’s Third-Party Meter Provider, SSN shall promptly perform all obligations, and provide all such information, contemplated to be performed or provided by SSN by the procedures and instructions described in the immediately preceding clause (a).  In the event that Customer is, pursuant to Customer’s contract with its Third-Party Meter Provider, entitled to *** from such Third-Party Meter Provider for *** as a result of an *** of Third-Party Integrated Meters during the time period specified in the first two sentences in this Section, Customer agrees to (i) use good faith efforts to *** from Customer’s Third-Party Meter Provider; provided, that Customer shall not be required to *** to SSN.

 

13.14.1.2.

SSN will provide Customer with *** Third-Party Integrated Meter Failure ***.  The report will include *** all Third-Party Integrated Meters *** Customer’s Third-Party Meter Provider *** Third-Party Integrated Meter *** of each such Third-Party Integrated Meter Failure, *** of each Third-Party Integrated Meter ***.  For example, the report provided not later than *** would include (x) information regarding all Third-Party Integrated Meters *** Customer’s Third-Party Meter Provider *** Third-Party Integrated Meter Failures *** including, to the extent available by the date of such *** of each such Third-Party Integrated Meter Failure, *** of each Third-Party Integrated Meter *** occurring during periods prior to *** that have been determined since the date of the ***.  In the event that SSN and Customer’s Third-Party Meter Provider do not, *** by Customer’s Third-Party Meter Provider of the applicable *** Third-Party Integrated Meters as contemplated by Section 13.14.1.1, resolve (x) a *** of a Third-Party Integrated Meter *** of Third-Party Integrated Meters, or (y) a *** as to the appropriate way to remedy such Third-Party Integrated Meter Failure, (including a ***, *** between SSN and Customer’s Third-Party Meter Provider, should effectuate *** such Third-Party Integrated Meter Failure), then Customer shall, upon SSN’s request, request that Customer’s Third-Party Meter Provider (i) retain a *** that is acceptable to Customer and SSN to *** (it being understood that nothing in the foregoing provisions of this Section 13.14.1.2 shall preclude Customer from issuing any such request prior to such date) and (ii) send such Third-Party Integrated Meter (or a sample thereof) to such *** after such Third-Party Meter Provider receives

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such Third-Party Integrated Meter. In the event that Third-Party Integrated Meters are sent by Customer’s Third-Party Meter Provider to a mutually agreed upon third-party *** as contemplated by this Section 13.14.1.2, (a) SSN will, in combination with the Third-Party Meter Provider, *** associated therewith (***) and will, in good faith, use its commercially reasonable efforts to work with Customer, Customer’s Third-Party Meter Provider and any such third-party *** to ensure that *** commences as promptly as reasonably practicable and to facilitate a prompt resolution, including providing such third-party *** with all reasonably necessary information *** Third-Party Integrated Meters; *** in accordance with Section 4.1.1, ***, until a determination is made by such third-party *** as to the cause of the Third-Party Integrated Meter ***.  For purposes of this Agreement, the following third-party ***.  

 

13.14.1.3.

If Customer’s Third-Party Meter Provider or, where the *** Third-Party Integrated Meters are sent to a mutually agreed upon third-party *** as contemplated by Section 13.14.1.2, such third-party *** concludes that the *** to perform in accordance with its *** or otherwise caused the applicable Third-Party Integrated Meter Failure, or (b) determines that the *** caused the Third-Party Integrated Meter ***, and SSN, Customer, and Customer’s Third-Party Meter Provider agree that such Third-Party Integrated Meter (and, where such ***) will be deemed to be ***, and, without limiting Customer’s rights and remedies under this Section 13.14,  Customer will be entitled to the applicable *** provided in Section 13.2 with respect to such *** Customer’s Third-Party Meter Provider or, at Customer’s election, *** such Third-Party Meter Provider, for all applicable ***. Without limiting the foregoing, if Customer is entitled to *** of this Agreement, then SSN shall *** Customer’s Third-Party Meter Provider or, at Customer’s election, directly *** Third-Party Meter Provider, for ***, and Customer shall not be responsible for ***.

 

13.14.1.4.

SSN will work in good faith with Customer’s Third-Party Meter Provider and any mutually agreed upon third-party *** of each Third-Party Integrated Meter ***.  If such Third-Party Meter Provider or, where applicable, such *** determines that the *** the Third-Party Integrated Meter *** determines that such Third-Party Integrated Meter *** is caused by or due to the *** or Third-Party Meter Provider, or (ii) where SSN, Customer’s Third-Party Meter Provider and Customer agree that such Third-Party Integrated Meter *** should be attributed to the applicable *** is unable to *** Third-Party Integrated Meter *** without limiting the immediately preceding (a) and (b), where the *** Third-Party Integrated Meters are sent to a *** upon third-party *** as contemplated by Section 13.14.1.2) has not *** Third-Party Integrated Meter Failure within *** of the applicable Third-Party Integrated Meter(s), then (x) SSN shall, in good faith, and in consultation with Customer, *** in an effort to resolve such Third-Party Integrated Meter *** as promptly as practicable and deliver to Customer’s Third-Party Meter Provider the *** of (i) where the applicable Third-Party Integrated Meters are sent to a third-party *** by Section 13.14.1.2, *** of the applicable Third-Party Integrated Meter or (ii) where the applicable Third-Party Integrated Meters are not sent to a third-party *** by Customer’s Third-Party Meter Provider of the applicable Third-Party Integrated Meters, the earlier of (A) Customer’s Third-Party Meter Provider’s determination and (B) *** by Customer’s Third-Party Meter Provider of the applicable Third-Party Integrated Meters; (y) with respect to each Third-Party Integrated Meter as to which a Third-Party Integrated Meter *** has occurred, the *** in such Third-Party Integrated Meter (and, *** are included as a sample of a *** in

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Section 13.2.5.2; *** Third-Party Integrated Meters and *** by SSN and Customer’s Third-Party Meter Provider in accordance with their separate agreement.  *** Third-Party Integrated Meters as contemplated by this this Section 13.14.1 shall (a) be *** provided in Section 13.2 for the *** Third-Party Integrated Meter to Customer.

 

13.14.1.5.

SSN agrees, for purposes of this Agreement, to *** of Customer’s Third-Party Meter Provider or, *** Third-Party Integrated Meters are *** by Section 13.14.1.2, such third-party *** (and not Customer’s Third-Party Meter Provider), as to the *** the Third-Party Integrated Meter ***, it being understood that the foregoing *** shall not be construed to be, any waiver *** between SSN and the applicable Third-Party Meter Provider. If a Third-Party Integrated Meter returned by Customer (or a representative of such Third-Party Integrated Meter) is *** a third-party *** after Customer’s Third-Party Meter Provider receives such Third-Party Integrated Meter, then the determination of  Customer’s Third-Party Meter Provider as to the *** applicable Third-Party Integrated Meter *** (*** of such Third-Party Integrated Meter ***, such inability to *** of the Third-Party Integrated Meter ***) shall be binding on Customer and SSN for purposes of this Agreement. For the avoidance of doubt, where a Third-Party Integrated Meter is *** of Third-Party Integrated Meters, *** to the Third-Party Integrated Meters within ***.

 

13.14.1.6.

*** pursuant to this Section 13.14.1.6, then Customer shall provide SSN with ***. SSN may, within *** that is acceptable to Customer *** that resulted in reaching the *** in accordance with such ***. If Customer does not *** or if SSN does not *** above pursuant to the *** this Agreement.  *** with respect to a Third-Party Integrated Meter shall be deemed to have occurred at such time as Customer becomes aware of the Third-Party Integrated Meter *** as to such Third-Party Integrated Meter. If a Third-Party Integrated Meter is submitted to a mutually agreed upon third-party *** as a mutually agreed upon *** occurs with respect to such *** Third-Party Integrated Meter, a separate *** shall similarly be deemed to have occurred with respect to each Third-Party Integrated Meter represented by such *** Third-Party Integrated Meter.  

 

13.14.1.7.

*** Third-Party Integrated Meter from ***, SSN will, *** Third-Party Integrated Meter ***.  In the case of any inconsistency between the *** provisions in Section 13.2 and this Section 13.14.1, this Section 13.14.1 shall control.  SSN’s obligations in this Section 13.14.1.7 shall only apply during the ***; provided that, except as otherwise expressly specified, SSN’s obligations with respect to the remainder of this Section 13.14 shall continue until the later of the date upon which (i) ***.

 

13.14.1.8.

SSN shall coordinate with Customer’s Third-Party Meter Provider to ensure that Customer has in *** Third-Party Integrated Meters sufficient to support the *** contemplated by the foregoing provisions of this Section 13.14.1 (*** by Customer’s Third-Party Meter Provider to Customer of the appropriate number of *** Third-Party Integrated Meters as promptly as practicable). Without limiting SSN’s obligations under any other provision of this Section 13.14.1 or under the provisions of Section 13.2, where one or more Third-Party Integrated Meters are *** by Customer pursuant to Section 5.4 or *** to Customer’s Third-Party Meter Provider, if Customer does not have the *** at Customer’s Third-Party Meter Provider, SSN shall deliver to Customer’s Third-Party Meter Provider (***) as promptly as practicable the requisite ***.

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13.14.1.9.

In no event shall anything in Section 13.14 be construed to obligate SSN to make any *** to Customer or its Third-Party Meter Provider that would constitute *** by Customer or its Third-Party Meter Provider, as applicable, *** (whether pursuant to Section 13.2 or this Section 13.14), and *** to Customer from Third-Party Meter Provider under Customer’s agreement with the Third-Party Meter Provider, relating to the *** and in respect of the same occurrence.

 

13.14.2.

Continuing Management and Administration.  SSN shall, to the extent requested by Customer, and in consultation with Customer, assume primary responsibility for the day-to-day management and administration of Customer’s contracts with its Third-Party Meter Providers, and shall assist Customer in monitoring and supporting Customer’s compliance with the obligations and responsibilities of Customer under each such contract, including assisting Customer with testing Third-Party Integrated Meters during the inspection period granted to Customer with respect to such Third-Party Integrated Meters under Customer’s contract with its Third-Party Meter Provider.  Without limiting the generality of the foregoing, in the event any fact, event, circumstance or other matter arises that, pursuant to the terms of any such contract, gives rise to a warranty or similar claim by Customer, SSN shall so promptly notify Customer and, subject to Customer’s approval in each instance, SSN shall promptly initiate and diligently prosecute such claim on Customer’s behalf.  SSN shall, in consultation with Customer, take *** for coordinating with the applicable Third-Party Meter Provider as to *** to the Third-Party Integrated Meters, *** Third-Party Integrated Meters.  In so doing, SSN shall exercise commercially reasonable efforts to (i) minimize any costs or expenses to be paid by Customer in connection therewith and (ii) effect any necessary repairs or replacements of Third-Party Integrated Meters in the manner least likely to disrupt Customer’s business or the Project Schedule.  SSN shall refrain from knowingly taking any action that would or could reasonably be expected to invalidate or limit any warranty provided by a Third-Party Meter Provider.  *** associated with the services of SSN set forth in this Section 13.14 have been included in the *** by Customer hereunder, and Customer shall not be ***, provided that SSN shall have no obligation to *** (*** between Customer and the applicable Third-Party Meter Provider) unless Customer first agrees to ***, except that Customer shall have no obligation to *** as contemplated by Section 13.14.1.2.  SSN shall, upon request, assist Customer in activities relating to Third-Party Integrated Meters, including discussions with the providers thereof, and shall keep Customer apprised as to the status of any discussions between SSN and any Third-Party Meter Provider pursuant to this Agreement, *** Third-Party Integrated Meter ***.  Customer shall notify applicable Third-Party Meter Providers of SSN’s obligations hereunder.  To the extent Customer wishes SSN to enforce and manage any provisions of Customer’s agreements with any Third-Party Meter Provider on Customer’s behalf, Customer shall (i) exercise its commercially reasonable efforts to obtain the written consent of such Third-Party Meter Provider to disclose the provisions of such agreements relating to the process and/or mechanism by which warranties are to be exercised or enforced and (ii) promptly, upon SSN’s request, furnish SSN with copies of such provisions.  To the extent requested by Customer, SSN shall cooperate in good faith with Customer and Customer’s Third-Party Meter Providers regarding the logistics of Communications Module delivery, warranties relating to the Third-Party Integrated Meters and the components thereof, including Third-Party Integrated Meter testing and Communications Module repair or replacement, and other applicable provisions of this Agreement that reasonably necessitate such cooperation.

14.

SOURCE CODE ESCROW.  

 

14.1.

Deposit of Source Code.  Within ninety (90) days of the Effective Date, the Parties shall enter into a registration agreement in the form of Exhibit M with the Escrow Agent (the “Escrow Agreement”).  SSN shall deposit in an escrow account the Source Code of the UIQ Software and Gridscape, Major and Minor Releases provided by SSN under this Agreement, and related

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documentation (collectively, the “Escrow Deposits”) within thirty (30) days after System Acceptance of each System.  SSN shall update the Escrow Deposits by depositing an updated package of the Escrow Deposits (the “Updated Escrow Deposits”) as soon as reasonably possible after they are made generally available, but in no event later than ninety (90) days following any Update. Payment of the fees charged by the Escrow Agent shall be as set forth in the Escrow Agreement.  Customer shall receive all of the Escrow Deposits upon the occurrence of a Release Event.  The terms of the Escrow Agreement shall ensure Customer’s access to and receipt of the Escrow Deposits for the purpose of exercising its rights under the Escrow License.  SSN shall not cancel or modify the Escrow Agreement without the prior written consent of Customer, which written consent must expressly refer to this Section 14.1.

 

14.2.

Escrow License.  SSN hereby grants to Customer, effective only following the occurrence of a Release Event and a release of the Escrow Deposits to Customer, a nonexclusive, non-transferable, non-sublicenseable, fully paid-up license to use, reproduce and create derivatives of the Escrow Deposits solely for the operation, maintenance, support, repair and improvement of the Licensed Software in connection with Customer’s utility business in the United States (“Purpose”), subject to the other limitations and restrictions contained in the Agreement (collectively, the “Escrow License”).  Upon the release of the Escrow Deposits to Customer upon the occurrence of a Release Event, Customer may thereafter correct, modify, update and enhance the Licensed Software in such Escrow Deposits for the Purpose, subject to the limitations and restrictions of the licenses to such Licensed Software granted to Customer under the Agreement. Ownership of any Derivative Works created under this provision will be as set forth in Section 11.2.  For avoidance of doubt, under this Section 14.2, Customer shall not have the right to develop a new copy of the UIQ installed on either an SSN or Customer server for any purpose without the payment of additional license fees to SSN.

 

14.3.

Release of Escrow License and the Escrow Deposits to Customer.  The Escrow License shall be effective, and the Escrow Deposits shall be immediately released to Customer, if any of the following occurs (each of which is a “Release Event”):

 

14.3.1.

SSN becomes a debtor under bankruptcy law and this Agreement or the licenses granted under this Agreement are rejected by SSN (or its bankruptcy trustee) under bankruptcy law;

 

14.3.2.

A receiver, trustee, or similar officer is appointed for the business or property of SSN;

 

14.3.3.

SSN files a petition in bankruptcy, files a petition seeking any reorganization (without confirming immediately in writing to Customer that it will continue to maintain the Licensed Software in accordance with the terms of this Agreement, including providing all applicable Services), makes an arrangement, composition, or similar relief under any law regarding insolvency or relief for debtors, or makes an assignment for the benefit of creditors;

 

14.3.4.

Any involuntary petition or proceeding under bankruptcy or insolvency laws is instituted against SSN and not stayed, enjoined, or discharged within sixty (60) days;

 

14.3.5.

Any similar or analogous proceedings or event to those in Sections 14.3.1 to 14.3.4 above occurs in respect of SSN within any jurisdiction outside the United States;

 

14.3.6.

Customer determines in good faith that SSN has either (i) announced its cessation of Software Support Services for a Licensed Software version which Customer is entitled to use under this Agreement; (ii) failed to meet the Response Time and Service Level requirements for Priority One/Severity Level 1 as set forth in Exhibit L (Software Maintenance Terms and Conditions) and Exhibit Q (Performance Metrics and Service Level Agreements) for a period of thirty (30) days from the date the Error is classified in accordance with Exhibit L, provided Customer gives written notice of such determination to SSN; or (iii) failed to or is unable to support and maintain the Licensed Software as

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required under this Agreement for a period of at least fifteen (15) days (and such failure is a breach of a material provision of the Agreement);  

 

14.3.7.

SSN ceases business operations in the normal course and no successor assumes all of the terms of this Agreement and the licenses granted hereunder within five (5) days following such event; or

 

14.3.8.

This Agreement is terminated for cause by Customer pursuant to Section 17.2, 17.3, or 17.6.  If it is later determined by a court of competent jurisdiction that the termination was wrongful, SSN shall be entitled to the return or destruction of the applicable Escrow Deposits.

 

14.4.

Confidentiality.  In the event Customer receives access to the Escrow Deposits under the terms of this Agreement or the Escrow Agreement, Customer agrees to keep any Confidential Information in such Escrow Deposits confidential, pursuant to the terms and conditions of this Agreement; provided, however, that Customer shall have the right to disclose such Escrow Deposits to those of its employees, agents, subcontractors and other third parties who (i) have agreed to be bound by confidentiality and use obligations consistent with those specified this Agreement (ii) are providing support and services to Customer and (iii) who have a need to know and access such Escrow Deposits for the purposes of exercising Customer’s rights under this Agreement.  Promptly upon SSN’s request, Customer shall provide SSN with the names and contact information of all individuals who have accessed the Escrow Deposits, and shall take all reasonable actions required to recover any Escrow Deposits in the event of loss or misappropriation, or to otherwise prevent their unauthorized disclosure or use.

 

14.5.

Treatment in Bankruptcy.  The source code escrow provisions in this Agreement, including the Escrow Agreement, shall each be deemed to be a “supplementary agreement” as contemplated in Section 365(n)(1)(B) of the Bankruptcy Code, 11 U.S.C. (the “Code”).  In any bankruptcy action by SSN, failure by Customer to assert its rights to “retain its benefits” to the Intellectual Property Rights encompassed by the Licensed Software or Developed Software, pursuant to Section 365(n)(1)(B) of the Code, under an executory contract rejected by the trustee in bankruptcy, shall not be construed by the courts as a termination of the contract by Customer under Section 365(n)(1)(A) of the Code.

15.

INDEMNIFICATION.

 

15.1.

General Indemnification.

 

15.1.1.

Indemnification by SSN.  To the extent permitted by law, SSN shall indemnify and hold harmless Customer and its employees, officers, directors, owners, advisors, consultants and agents (as “Customer Indemnitees”) from any and all *** of SSN or any other SSN Indemnitee *** of any SSN Indemnitee, *** of any SSN Indemnitee *** of any SSN Indemnitee, *** any obligation of SSN to ***; (iv) any *** as provided in Section 19; ***.  

 

15.1.2.

Indemnification by Customer.  To the extent permitted by law, Customer shall indemnify and hold harmless SSN and its employees, officers, directors, owners, advisors, consultants and agents (as “SSN Indemnitees”) from any and all *** by Customer of any representation or warranty of Customer set forth in this Agreement, *** by Customer of any covenant of Customer set forth in this Agreement or *** of Customer in performing its installation of the Customer-installed Endpoints (provided, that where Customer performs such installation in accordance with SSN’s instructions, then notwithstanding any interpretation to the contrary, Customer shall not be deemed to have been *** or to have committed *** in performing such installation).

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15.2.

Third-Party Claims.  

 

15.2.1.

Whenever a Customer Indemnitee or an SSN Indemnitee (as applicable, the “Indemnitee”) entitled to indemnification under this Section 15 shall learn of a claim that would entitle such Indemnitee to indemnification under this Section 15, the Indemnitee shall provide SSN or Customer, as the indemnifying Party (as applicable, the “Indemnitor”) with notice of such claim or action within *** of the commencement of, or actual knowledge by the Indemnitee of, such claim or action.  The Indemnitor shall, as promptly as practicable (and, in any event, within *** after its receipt of such notice), notify the Indemnitee in writing of whether the Indemnitor desires to assume and control the defense of the claim that is the subject of such notice.  

 

15.2.2.

If the Indemnitor timely notifies the Indemnitee of its desire to defend such claim pursuant to this Section 15.2 and acknowledges its obligations to indemnify hereunder, then the Indemnitor shall have control over the defense of such claim and related proceedings, including any settlement thereof.  The Indemnitor shall employ counsel reasonably satisfactory to the Indemnitee, and shall pay all expenses in connection with the conduct of such defense.  The Indemnitor shall diligently work to defend any claim that it has agreed to defend and shall consult and cooperate with the Indemnitee regarding such defense and shall not enter into any settlement without the prior written consent of the Indemnitee, unless (i) there is no finding or admission of any violation of law or any violation of the rights of any person or entity and no adverse effect on any other claims that may be made against the Indemnitee, (ii) the sole relief provided is monetary damages that are paid in full by the Indemnitor and (iii) such compromise or settlement contains a full and unconditional release of the Indemnitee.  

 

15.2.3.

The Indemnitee shall have the right to employ separate counsel in any such proceeding and to participate in (but not control) the defense of such claim, but the fees and expenses of such counsel shall be borne by the Indemnitee unless the Indemnitor shall agree otherwise.  

 

15.2.4.

The Indemnitor shall not be entitled to control (but shall be entitled to participate at its own expense in the defense of), and the Indemnitee shall be entitled to have sole control over, at the Indemnitor’s expense, the defense or settlement, compromise, admission or acknowledgment of any claim (A) if the Indemnitor shall have failed to timely notify the Indemnitee of its desire to defend such claim and acknowledged its indemnification obligations hereunder, (B) if the Indemnitor fails to employ counsel reasonably satisfactory to the Indemnitee, (C) if the Indemnitee shall have reasonably concluded that there may be defenses available to the Indemnitee that are different from or additional to those available to the Indemnitor, (D) if the Indemnitee’s counsel shall have advised the Indemnitee that there is a conflict of interest that could make it inappropriate under applicable standards of professional conduct to have common counsel, or (E) to the extent such claim seeks an order, injunction or other equitable relief against the Indemnitee which, if successful, would materially adversely affect the business, operations, assets or financial condition of the Indemnitee; provided, that the Indemnitee shall make no settlement, compromise, admission or acknowledgment that would give rise to liability on the part of the Indemnitor without the prior written consent of the Indemnitor, which consent shall not be unreasonably withheld, conditioned or delayed; provided further that in so controlling any such defense, the Indemnitee shall exercise its commercially reasonable efforts to avoid interfering with any defense by the Indemnitor of any separate claim (not relating to the Indemnitee) regarding similar subject matter.

 

15.3.

Payment.  Upon resolution of a claim giving rise to an indemnification obligation of an Indemnitor to an Indemnitee, the Indemnitor shall promptly pay to the Indemnitee all amounts owed to such Indemnitee in connection with such indemnification obligation.

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15.4.

***.  THE PARTIES HERETO INTEND THAT THE INDEMNITIES SET FORTH IN THIS AGREEMENT BE CONSTRUED AND APPLIED AS WRITTEN HEREIN, NOTWITHSTANDING ANY RULE OF CONSTRUCTION TO THE CONTRARY.  WITHOUT LIMITING THE FOREGOING, BUT LIMITED TO THE EXTENT PROVIDED ABOVE, SUCH INDEMNITIES SHALL APPLY NOTWITHSTANDING ANY STATE’S *** OR SIMILAR RULE THAT WOULD DENY COVERAGE BASED ON AN INDEMNIFIED PARTY’S SOLE OR CONCURRENT, ACTIVE OR PASSIVE ***.  IT IS THE INTENT OF THE PARTIES HERETO THAT, TO THE EXTENT PROVIDED ABOVE, THE INDEMNITIES SET FORTH IN THIS AGREEMENT SHALL APPLY TO AN INDEMNITEE’S SOLE OR CONCURRENT, ACTIVE OR PASSIVE ***.  THE PARTIES HERETO AGREE THAT THIS PROVISION IS “CONSPICUOUS” FOR PURPOSES OF ALL STATE LAWS.

16.

LIMITATIONS OF LIABILITY.

 

16.1.

Disclaimer of Certain Damages.  EXCEPT WITH RESPECT TO AMOUNTS PAYABLE TO THIRD PARTIES IN CONNECTION WITH THIRD-PARTY CLAIMS, NEITHER PARTY WILL BE LIABLE TO THE OTHER PARTY FOR ANY INDIRECT, SPECIAL, INCIDENTAL OR EXEMPLARY DAMAGES ARISING OUT OF THIS AGREEMENT, WHETHER FORESEEABLE OR UNFORESEEABLE, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES (IT BEING UNDERSTOOD BY THE PARTIES THAT CUSTOMER’S RIGHTS WITH RESPECT TO THE PAYMENT OBLIGATIONS OF SSN EXPRESSLY SET FORTH IN SECTIONS 4.3 AND 18.2.1 ARE NOT WAIVED HEREBY).  

 

16.2.

Dollar Limit on Most Liabilities.  EXCEPT FOR A BREACH OF SECTION 9 (FEES; PAYMENT TERMS; TAXES), SECTION 13.3.1.2 (SERVICES), OR SECTION 19 (INSURANCE), AND EXCEPT FOR INDEMNIFICATION OBLIGATIONS UNDER SECTION 12.1 (INFRINGEMENT) AND CLAUSES (i)-(v) OF SECTION 15.1.1 (INDEMNIFICATION), UNDER NO CIRCUMSTANCES SHALL EITHER PARTY’S LIABILITY TO THE OTHER ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE EQUIPMENT OR SERVICES, EXCEED THE GREATER OF ***, REGARDLESS OF WHETHER ANY ACTION OR CLAIM IS BASED ON CONTRACT, WARRANTY, INDEMNITY, NEGLIGENCE, STRICT LIABILITY, TORT OR OTHERWISE.  In no event shall the limitation of liability set forth in this Section 16.2 be in any way deemed to include the costs of, or limit, SSN’s obligation to deliver all Products and perform all Services required under this Agreement.  

17.

TERM AND TERMINATION.

 

17.1.

Term.  The “Term” of this Agreement shall be from the Effective Date and, unless terminated earlier as provided herein, continue until the twelfth (12th) anniversary thereof, or, if later, the date that is thirty (30) days after full performance by SSN of any outstanding Purchase Order.

 

17.2.

Termination for Default.  Either Party shall be entitled to terminate this Agreement in the event of a failure by the other Party to perform any of its material obligations under this Agreement if such default is not cured within thirty (30) days after receipt of notice thereof from the non-defaulting Party.  Any notice of default provided hereunder shall specify (i) the nature of such default and (ii) the specific act or acts which the non-defaulting Party contends would, if undertaken, correct such default.

 

17.3.

Insolvency; Confidentiality.  Either Party may immediately terminate this Agreement and the licenses granted hereunder if the other Party (i) becomes insolvent and becomes unwilling or unable to meet its obligations under this Agreement, (ii) files a petition in bankruptcy, (iii) is subject to the filing of an involuntary petition for bankruptcy which is not rescinded within a period of forty-five (45) days, or (iv) materially breaches its obligations of confidentiality hereunder.

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17.4.

Change in Law.  Customer may terminate this Agreement immediately if, at any time after the Effective Date, there is an enactment, modification, repeal or change in applicable federal, state or local law or a mandate by any applicable governing body that prohibits Customer from deploying or using any of the Systems, prohibits Customer’s performance hereunder or requires Customer to use equipment and technology similar to any System but that is of a different or of better performance grade than such System.

 

17.5.

Convenience.  Without limitation of, and subject to, Section 5.6, Customer may, at any time after System Acceptance of all Systems, upon *** written notice, terminate this Agreement as to any or all Products or Services provided hereunder.  Upon receipt of notice of termination, SSN shall, unless the notice requires otherwise (i) discontinue performance of Services to the extent specified in the notice and (ii) make every reasonable effort to procure termination of all orders, subcontracts and rental agreements to the extent they relate to performance of Services terminated.

 

17.6.

Additional Termination Rights.  Customer shall be entitled to terminate this Agreement as provided in Sections 13.5, 13.14.1.6, 19.2, 21.17 and 21.19.

 

17.7.

Effect of Termination.  

 

17.7.1.

Upon termination of this Agreement for any reason, (i) Customer shall pay to SSN all undisputed accrued Fees due hereunder in respect of Products provided and Services rendered prior to such termination, and (ii) SSN shall be required, no later than sixty (60) days after the termination or discontinuance of this Agreement, to vacate all properties of Customer and remove all materials and supplies of SSN thereon.  ***, this Agreement is *** (other than by SSN pursuant to Section 17.2 or 17.3 or by Customer pursuant to Section 17.4 or 17.5), SSN shall ***.

 

17.7.2.

No later than ten (10) days after the date of termination or discontinuance of this Agreement for any reason whatsoever, if so requested by a Party in writing, each Party shall promptly return to the other all of the other’s Confidential Information or shall destroy all copies thereof.  Notwithstanding the foregoing, (a) a Party that receives Confidential Information may, for legal or internal compliance purposes, or for the purpose of resolving any dispute that may arise under this Agreement, retain a copy of such Confidential Information in accordance with such Party’s internal proprietary information retention policies; provided that any such retained copies shall remain subject to the confidentiality obligations of this Agreement and shall be used for no other purposes, and (b) no Party shall be required to delete electronically-stored Confidential Information to the extent such deletion would be technologically impracticable; provided that such Party shall not (and shall ensure that those persons to whom such Party has disclosed such Confidential Information pursuant to Section 10 do not) access such Confidential Information after the date of any request to return or destroy such Confidential Information pursuant to the preceding sentence.  

 

17.7.3.

If this Agreement (x) is terminated by SSN pursuant to Section 17.2 or 17.3, then SSN shall determine, in its sole discretion, whether any accepted Purchase Order outstanding as of the effective date of such termination (and the obligations associated therewith, including any applicable obligations to pay any cancellation fees under Section 5.6) shall survive such termination or whether it shall similarly terminate on such effective date, or (y) expires or is terminated by either SSN or Customer under any other provision of this Agreement, then Customer shall determine, in its sole discretion, whether any accepted Purchase Order outstanding as of the effective date of such termination (and the obligations associated therewith) shall survive such termination or expiration or whether it shall similarly expire or terminate on such effective date.

 

17.7.4.

Upon valid termination of this Agreement by SSN pursuant to Section 17.2 or clause (iv) of Section 17.3, all licenses granted hereunder shall terminate, Customer shall cease using the Licensed Software and Documentation and Customer shall certify in writing to SSN

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that all copies (in any form or media) have been destroyed or returned to SSN; provided that Customer shall not be required to delete electronically-stored Licensed Software and Documentation to the extent such deletion would be technologically impracticable.

 

17.7.5.

Upon the expiration or earlier termination of this Agreement other than by SSN pursuant to Section 17.2 or 17.3, SSN shall be entitled to only the portion of the Software Support Services Fees and Solutions Services Fees paid by Customer in advance for the time period from the first day of the twelve (12)-month period or month, as applicable, in which such Fees have been paid, until the effective date of termination of this Agreement.  SSN shall promptly refund to Customer the remaining portion of Software Support Services Fees and Solutions Services Fees for such twelve (12)-month period or month, as applicable.

 

17.8.

Notice.  Any termination of this Agreement by a Party under any provision of this Agreement shall be effective only upon the provision of written notice to the other Party.

 

17.9.

Survival.  The provisions of Section 3 (RULES OF CONSTRUCTION; DEFINITIONS), Section 5.6 (ORDER CANCELLATIONS), Section 9 (FEES, PAYMENT TERMS; TAXES), Section 10 (CONFIDENTIALITY), Section 11 (INTELLECTUAL PROPERTY RIGHTS), Section 12 (INFRINGEMENT), Section 13.2 (EQUIPMENT), Section 13.3 (SERVICES), Section 13.4 (SOFTWARE), Section 13.5.2 (SYSTEM), Section 13.14.1 (THIRD-PARTY INTEGRATED METERS), the last sentence of Section 13.14.2 (THIRD-PARTY INTEGRATED METERS), Section 14.2 (ESCROW LICENSE), Section 14.3 (RELEASE OF ESCROW LICENSE AND THE ESCROW DEPOSITS TO CUSTOMER), Section 15 (INDEMNIFICATION), Section 16 (LIMITATIONS OF LIABILITY), Section 17.7 (EFFECT OF TERMINATION), this Section 17.9 (SURVIVAL), Section 18.2.4 (DELAY OF Communications Modules), Section 19 (INSURANCE), Section 20.1.2 (STATUS; RESPONSIBILITY) and Section 21 (GENERAL) shall survive termination of this Agreement.  The licenses granted to Customer pursuant to this Agreement shall survive termination of this Agreement unless Customer’s licenses are terminated as provided in Section 17.7.4 (Effect of Termination).  Except in the event of termination by SSN pursuant to Section 17.2 or Section 17.3, the provisions of Section 4.2 (ECONOMIC DEVELOPMENT MILESTONES) shall survive termination of this Agreement, provided that at the time of such termination, SSN has Optimized at least one hundred thousand (100,000) Endpoints.  Exhibits shall survive only to the extent necessary to give effect to the survival of the provisions of those Sections expressly identified above in this Section 17.9.

18.

DELAYS.

 

18.1.

SSN Delay.  SSN shall notify Customer in writing promptly of any delay, or anticipated delay, in SSN’s performance of this Agreement and the reason for and anticipated length of the delay.  Further, SSN shall, at SSN’s sole cost and expense, immediately take steps to bring the Project back on the Project Schedule.  Such steps shall include adding additional staff, increasing the hours worked, adding equipment, working shift work or any combination of the above, with all costs to SSN’s account.

 

18.2.

Right to Liquidated Damages.  Customer will have the right to claim liquidated damages if SSN fails to meet a Delivery Date for Equipment specified in a Purchase Order and such failure (i) materially delays the completion of the Project and (ii) is not caused by an Excusable Delay. In such event, SSN shall submit to Customer, in good faith, a mitigation plan in respect of such failure as promptly as practicable.

 

18.2.1.

Grace Period; Liquidated Damages.  SSN shall, with respect to each originally scheduled Delivery Date for Equipment, have a grace period of ten (10) days in which to deliver the subject Equipment.  Upon expiration of such grace period, liquidated damages shall, until such time as SSN (i) properly delivers the subject Equipment or (ii) proposes in good faith a mitigation plan acceptable to Customer, ***; provided, however, that to the extent SSN has *** pursuant to Section 18.2.4, *** under this Section 18.2.1.  Customer shall have

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five (5) days in which to review any such mitigation plan proposed by SSN.  After reviewing any such plan, Customer may, in its sole discretion, select one or more of the proposed options and negotiate its implementation with SSN.  If Customer does not so elect one of SSN’s mitigation plans, then, without prejudice to any other right of Customer hereunder, the Parties shall attempt to agree upon a mitigation plan and the provisions of Section 21.12 shall apply to the Parties’ discussions related thereto.

 

18.2.2.

Sole and Exclusive Remedy.  The Parties acknowledge and agree that any liquidated damages are a genuine pre-estimate of the loss that Customer is likely to suffer as a result of any SSN delay in meeting an Equipment Delivery Date, and are not a penalty.  Subject to Customer’s termination rights in Section 17, the liquidated damages described in Section 18.2.1 and Section 18.2.4 shall, except where SSN’s delay and/or failure to meet an Equipment Delivery Date results in the failure by SSN to timely achieve an Execution Milestone, be Customer’s sole and exclusive remedy for such delay and/or failure.  A claim for liquidated damages shall not affect Customer’s right to take action or seek damages for matters other than a delay in and of itself (and not, by way of example, for breaches by SSN of this Agreement resulting in, or resulting from, such delay).

 

18.2.3.

***.  ***.  For avoidance of doubt:

 

18.2.3.1.

Customer will not be entitled to any liquidated damages to the extent SSN’s time for performance has been extended because of (i) an Excusable Delay or (ii) Customer has agreed to an extension in an amendment to this Agreement (unless SSN fails to meet the date of such extension).

 

18.2.3.2.

Any and all amounts paid by SSN under this Section 18.2.3 and Section 18.2.4 below shall be credited to any calculation of amounts payable by SSN under Section 16.

 

18.2.4.

Delay of Communications Modules.  The Parties acknowledge that if (i) Communications Modules to be integrated into Third-Party Integrated Meters are not delivered on or before the applicable delivery date(s) set forth in a Purchase Order issued in accordance with Section 5.1 or (ii) without limiting the foregoing, SSN otherwise fails to manufacture, sell and timely deliver to the applicable Delivery Point Communications Modules as contemplated hereby and on the terms set forth herein, Customer could incur substantial damages.  SSN, therefore, agrees to reimburse Customer for all storage, delay, cancellation and similar fees paid by Customer to Customer’s Third-Party Meter Provider in connection with any such late delivery of Communications Modules (or any failure of SSN to timely manufacture, sell and deliver such Communications Modules as contemplated hereby); provided that (i) SSN will always have a grace period of *** in which to deliver Communications Modules to be integrated into Third-Party Integrated Meters after the scheduled delivery date before any reimbursable fees will accrue, and (ii) in no case shall SSN be obligated to reimburse Customer pursuant to this Section 18.2.4 for amounts in excess of ***, in aggregate.

 

18.3.

Customer Delay.  Customer may request that SSN delay the manufacture, shipment and/or installation of the Products or the provision of the Services by providing SSN with written notice of any such delay, or anticipated delay.  Upon receipt of any such request, SSN shall provide Customer a written good faith estimate of any additional costs and expenses that SSN will necessarily incur by reason of such delay.  If Customer agrees to pay such additional costs and fees by notifying SSN thereof, then the applicable Purchase Order shall be deemed amended to reflect such delay and to include such additional costs and expenses as additional Fees, if any.  The Project Schedule (and, thus, SSN’s time for performance) shall be extended, as and to the extent necessary, to accommodate such requested delay unless Customer agrees to pay any expedite and similar costs actually incurred by SSN in bringing the Project back on to the Project Schedule following such requested delay.  Promptly upon any delayed delivery pursuant to this Section 18.3, SSN shall provide

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Customer with its good faith estimate of the costs described in the immediately preceding sentence.  Notwithstanding anything herein to the contrary, under no circumstance may any Purchase Order be amended to reflect additional costs, expenses or other Fees if the delay requested by Customer under this Section 18.3 is, in whole or in part, and whether directly or indirectly, attributable to the failure of SSN to perform in strict compliance with the terms of this Agreement, including the delivery by SSN of all Products and Services in accordance with all applicable Execution Milestones.

 

18.4.

Excused Performance.  Without limiting the provisions of Section 9.3, Customer shall be excused from the non-performance of any of its obligations under this Agreement (including for the avoidance of doubt, those relating to payment) (i) during all periods in which SSN has not or is not addressing warranty claims of Customer in the time period and in the manner specified in this Agreement, (ii) during the pendency of any third-party claim with respect to which any Customer Indemnitee is entitled to indemnification hereunder, (iii) until such time as SSN has honored all of SSN’s payment obligations to subcontractors of SSN providing services or materials with respect to the Project, (iv) if at any time SSN is not in compliance with the Execution Milestones and the Project Schedule and (v) at all times during which SSN is otherwise in breach of this Agreement, subject, in each case, to any cure periods expressly afforded to SSN in this Agreement.  If Customer withholds payment to SSN on the basis of any circumstance articulated in any of the immediately preceding clauses (i) through (v), Customer shall so notify SSN in writing.  In the absence of any circumstance articulated in such clauses (i) through (v), Customer shall be obligated to pay to SSN all undisputed amounts previously withheld pursuant to the foregoing provisions of this Section 18.4.

 

18.5.

Force Majeure.  Subject to the succeeding sentence, neither Party shall be considered in default in the performance of its obligations under this Agreement if prevented or delayed from such performance by any cause which is beyond the reasonable control and without the fault or negligence of that Party (“Force Majeure”), provided that the Party that desires to have its performance temporarily excused by this Section 18.5 shall have first exercised its commercially reasonable efforts to minimize any delay or inability to perform resulting therefrom.  Unless the other Party agrees in writing to a longer time period, the Party that desires to have its performance temporarily excused as a result of Force Majeure shall be excused from its performance of the applicable obligation for a period not to exceed sixty (60) days.  “Force Majeure” may include insurrections, riots, wars and warlike operations, explosions, governmental or military acts, epidemics, strikes, fires, floods, earthquakes, severe weather, import quotas, acts of any public enemy, embargoes or blockades, including, without limitation, the inability for SSN to obtain SSN Meters solely as a result of the foregoing. Any Party temporarily excused from its performance under this Agreement by any such circumstances shall resume performance upon the earlier of (i) sixty (60) days (subject to any mutually agreed extension) following the occurrence of the applicable event of Force Majeure and (ii) the date upon which the applicable event of Force Majeure is avoided, removed or cured.  Any Party claiming an event of Force Majeure as an excuse for delay in its performance shall give prompt notice in writing thereof to the other Party and shall exercise all commercially reasonable efforts to (i) minimize any delay in the performance of this Agreement as a result of the applicable Force Majeure event and (ii) mitigate any damages to the other Party resulting from the applicable Force Majeure event.

19.

INSURANCE.  

 

19.1.

Insurance Requirements.  SSN shall not commence Services under this Agreement until it has obtained all required insurance and until such insurance has been reviewed and approved in writing by Customer in accordance with this Section 19, such approval not to be unreasonably withheld, delayed or conditioned.  Customer’s approval of such insurance shall not relieve nor decrease the liability of SSN hereunder.  Prior to commencing any Services, SSN shall provide evidence satisfactory to Customer that all insurance coverages for the limits and forms of coverages required under Customer’s Minimum Insurance Requirements (Exhibit A) are in full force and effect.  SSN’s

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insurance shall be independent and primary of any self-insurance and/or insurance maintained by Customer.

 

19.2.

Maintenance of Insurance.  SSN shall not cause or allow any of its insurance (as set forth in Exhibit A) to be canceled, nor permit any insurance to lapse during the Term of this Agreement and until SSN has finally vacated all properties of Customer thereafter.  Failure of SSN to meet the insurance requirements set forth in this Agreement shall entitle Customer to terminate this Agreement immediately (and, for the avoidance of doubt, the additional cure period set forth in Section 17.2 shall not apply).

 

19.3.

Right to Review Policies.  

 

19.3.1.

Customer reserves the right to review the insurance required hereunder in order to assess whether adjustments to the insurance coverages and their limits may need to be made in connection with the expansion of Services and/or the Project pursuant to a SOW.  SSN will consider in good faith any additional coverages and limits reasonably requested by Customer in connection with such review.  

 

19.3.2.

Upon Customer’s request, SSN shall promptly provide Customer with a certificate of its insurance and/or Customer’s outside legal counsel with true copies of policies from the insurance agent or carrier of such insurance coverages solely for the purposes of enabling such legal counsel to confirm that such policies meet the applicable insurance requirements of this Agreement.  As an inducement to allow such review, Customer agrees that it shall instruct and require that its outside legal counsel not, without SSN’s prior written consent, disclose or provide to Customer access to such insurance policies or the specific terms or conditions thereof, provided that Customer’s legal counsel may disclose such policies (i) if required by law, statute, regulation or court order, upon prior written notice to SSN (if legally permitted) or (ii) if necessary to enforce Customer’s rights under this Agreement.  SSN may designate any insurance policies provided to Customer’s legal counsel hereunder as confidential in order to protect the same against disclosure under Chapter 552 of the Texas Government Code (Texas Public Information Act), and in such event Customer will take reasonable action to seek to preserve the confidentiality of the information about SSN’s insurance policies in the possession of Customer’s outside legal counsel, pursuant to the attorney client privilege and any applicable exception to disclosure under the Texas Public Information Act.  If Customer’s legal counsel determines that SSN’s policies contain deficiencies that cause such policies not to comply with the requirements of this Agreement, such legal counsel may generally describe such deficiencies to Customer, and SSN agrees to, with respect to any material deficiency, reimburse Customer for all reasonable costs and fees of its outside legal counsel incurred in attempting to resolve such policy deficiencies by special endorsement thereof to achieve compliance with the insurance requirements in this Agreement.

20.

PERSONNEL; SUBCONTRACTORS.

 

20.1.

Hosted Personnel.

 

20.1.1.

Generally.  During the Term of this Agreement, each Party may allow employees or contractors of the other Party to participate in activities at the Party’s facilities (“Hosted Personnel”), which, in the case of SSN, shall at all times be in compliance with Sections 20.2 and 20.3.

 

20.1.2.

Status; Responsibility.  All Hosted Personnel will retain their status as an employee or contractor of their respective company while assigned to work at the hosting Party’s premises.  Each Party will be solely responsible for all wages and other compensation, and for all tax withholdings and similar payments required in connection with its employees and contractors assigned as Hosted Personnel.

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20.2.

SSN’s Personnel.  SSN’s personnel assigned to the Project shall possess sufficient skills, licenses and expertise as required to satisfactorily meet all applicable obligations of SSN under this Agreement.  SSN shall, as it relates to all such personnel, comply with all applicable labor and employment laws, and all health, safety and environmental policies of Customer.  SSN acknowledges and agrees that it does not have the authority to enter into any contract with respect to labor matters or settle any labor disputes that purport to bind or otherwise obligate Customer.  Customer retains the right to reject or require SSN to remove any employee whose qualifications or performance in Customer’s good faith and reasonable judgment do not meet the standards established by both Parties as necessary for performance of the Services hereunder.  Customer reserves the right to participate in the interviewing process for and to review resumes of any Key Personnel.  SSN shall not (i) select or replace any Key Personnel or (ii) assign any individual to the Project, in each case without sending notice to and obtaining Customer’s prior written consent, which, in the case clause (ii), shall not be unreasonably withheld, conditioned or delayed.  SSN shall promptly comply with any request by Customer to replace SSN’s Key Personnel for any legally permissible reason.  SSN shall use good faith and diligent efforts to ensure that Key Personnel shall not be removed from the Project or reassigned except for termination of employment, death or serious illness, incapacity or a bona fide family emergency.  

 

20.3.

Subcontractors.  Subject to this Section 20.3, SSN may subcontract its obligations under this Agreement but may not delegate its responsibility for the overall management and direction of the Services.  Each subcontractor used by SSN shall be qualified to perform the Services subcontracted to it in accordance with all applicable laws and in a prudent industry manner.  Customer shall have the right to designate a particular subcontractor to perform the installation of Gas IMUs and Integrated Meters, labor associated with warranty claims and project management services associated therewith in accordance with this Agreement (the “Installation Services”); provided that (i) such subcontractor meets the qualification in the preceding sentence, and (ii) if the amount owed by SSN to such subcontractor with respect to such subcontractor’s performance of the Installation Services exceeds ***, then CPS Energy shall pay to ***. Upon designation by CPS Energy of a subcontractor to perform the Installation Services, SSN shall use its commercially reasonable efforts to, as promptly as practicable, commence discussions and negotiate a binding agreement with such subcontractor regarding the performance of such subcontracted Installation Services, on terms consistent with market standard. All subcontractors must be pre-approved by Customer in writing, such approval not to be unreasonably withheld, conditioned or delayed, and Customer reserves the right to direct SSN to discontinue the use of any subcontractor in the provision of Services hereunder upon ten (10) days written notice to SSN.  SSN is responsible for each of the various parts of the Services so that no part is left in an unfinished or incomplete condition due to any failure by any subcontractor or disagreement between any subcontractors or between a subcontractor and SSN.  Nothing herein shall (i) create or constitute any contractual relationship between Customer and any subcontractor or (ii) create any obligation on the part of Customer to any subcontractor.  Customer shall have no obligation to directly pay, or to see to the direct payment of, any monies to any subcontractor.  SSN shall pay all amounts due and payable to any subcontractor.  No such subcontract will relieve SSN from its obligations under this Agreement, and SSN agrees that it is as fully responsible to Customer for the performance of the Services by, and the other acts and omissions of, its subcontractors and their respective representatives as it is for the acts and omissions of itself and its own representatives.  No subcontract shall be binding on Customer, unless Customer expressly assumes such subcontract in writing following a termination of this Agreement.

21.

GENERAL.

 

21.1.

Governing Laws.  This Agreement shall be governed by and construed in accordance with the laws of the State of Texas (exclusive of conflict of law principles).  EACH PARTY HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED IN SAN ANTONIO, TEXAS, IN CONNECTION WITH ANY ACTION, SUIT OR PROCEEDING BROUGHT IN CONNECTION WITH THE RIGHTS AND OBLIGATIONS OF THE PARTIES PURSUANT TO THIS AGREEMENT, AND AGREES THAT ANY SUCH ACTION, SUIT OR PROCEEDING MAY BE

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BROUGHT IN SUCH COURT.  EACH PARTY HEREBY IRREVOCABLY WAIVES DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF ANY SUCH ACTION OR PROCEEDING.  Prior to either Party instituting any action at law or judicial proceeding (other than the seeking of an injunction), the Parties shall engage in the dispute resolution process set forth in Section 21.12.

 

21.2.

Binding Upon Successors; Assignment.  Neither Party may assign any of its rights, whether by operation of law or otherwise, without the prior express written consent of the other Party; provided however, that either Party may assign this Agreement without such consent in connection with a merger, acquisition, corporate reorganization or sale of all or substantially all of its assets provided that its assignee (i) is at least as creditworthy as the assigning Party, (ii) agrees in writing to assume the obligations of the assigning Party hereunder, and (iii) is able to (and does) make those representations set forth in Section 13.1 as to itself, and as of the date of the applicable assignment (disregarding for such purpose, the words “as of the Effective Date” set forth in such Section 13.1).  Any attempted assignment in violation of this Section 21.2 shall be null and void.  Subject to the foregoing, this Agreement will bind and inure to the benefit of the Parties, their respective successors and permitted assigns.  

 

21.3.

Entire Agreement; Termination of Letter Agreement.  This Agreement amends and restates in its entirety the Second A&R Master Agreement and constitutes the entire understanding between the Parties regarding the subject matter hereof and supersedes all prior oral or written agreements or understandings between the Parties regarding the subject matter hereof, including that certain Letter Agreement dated December 28, 2012 (the “Letter Agreement”). By entry into this Agreement, the Parties hereby (i) for the avoidance of doubt, acknowledge that this Agreement supersedes and governs the Parties’ respective obligations with respect to the DA Radio Agreement (as defined in the Letter Agreement), and (ii) terminate the Letter Agreement effective as of the Effective Date.

 

21.4.

Severability.  The unenforceability of any provision of this Agreement shall not impair the enforceability of any other part of this Agreement to the extent permitted by applicable law.  If any provision of this Agreement shall be deemed invalid or unenforceable, in whole or in part, this Agreement shall be deemed amended to delete or modify, as necessary, the invalid or unenforceable provision to render it valid, enforceable, and, insofar as possible, consistent with the original intent of the Parties.

 

21.5.

Amendment and Waivers.  Any term or provision of this Agreement may be amended, and the observance of any term of this Agreement may be waived, only by a writing signed by the Parties to be bound thereby, which, in the case of Customer, must be signed by an Authorized Person.  The delay or failure of a Party, at any time or from time to time, to require performance of any obligations of the other Party hereunder shall not be deemed a waiver and shall not affect its right to enforce any provision of this Agreement at a subsequent time.

 

21.6.

Preparation of Agreement.  Both Customer and SSN and their respective counsel participated in the preparation of this Agreement.  In the event of any ambiguity in this Agreement, no presumption shall arise based on the identity of the draftsman of this Agreement.

 

21.7.

Export Compliance and Foreign Reshipment Liability.  This Agreement is expressly made subject to any laws, regulations, orders or other restrictions on the export from the United States of software, firmware, hardware or technical information that may be imposed from time to time by the government of the United States.  The Software, including technical data, are subject to applicable U.S. export control laws, including the U.S. Export Administration Act and its associated regulations, and may be subject to export or import regulations in other countries.  Customer agrees to strictly comply with all applicable U.S. export control laws and any other applicable regulations.  Customer will not transport, export or re-export, or otherwise disclose to any national or resident of any country outside the United States, either directly or indirectly, the Software, or technical information, or portions thereof, without first obtaining any and all necessary licenses from the

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United States government or agencies or any other country for which such government or any agency thereof requires an export license or other governmental approval at the time of modification, transport, export or re-export.

 

21.8.

Notices.  Any notice, demand or request with respect to this Agreement shall be in writing and shall be effective on the date received (unless the notice specifies a later date) only if it is sent by a courier service that confirms delivery in writing, or if sent by certified or registered mail, postage prepaid, return receipt requested, addressed to the Party as follows:

 

CPS Energy

Attn:  David Jungman

Maildrop #100612

P.O. Box 100612

145 Navarro

San Antonio, Texas  78296-1771

 

With copy to:

 

CPS Energy

Attn:  General Counsel

Maildrop #101011

P.O. Box 1771

145 Navarro

San Antonio, Texas  78296-1771

 

Silver Spring Networks

Attn:  Steve Ingram, Vice President, Global Delivery

555 Broadway Street

Redwood City, California  94063

 

 

 

With a copy to: General Counsel at the same address.

 

No notices, demands or requests with respect to this Agreement may be delivered by electronic mail or fax.  Any Party may change its address for such communications by giving notice thereof to the other Party in conformity with this Section 21.8.  The Parties shall immediately notify each other of any legal notices served on them which might affect the other, and shall promptly forward the original or a copy of such notice to the other.

 

21.9.

Third-Party Beneficiaries.  Except (i) for the City of San Antonio with respect to Section 4.2 and (ii) Indemnitees as provided in Section 12.1 and Section 15, no provisions of this Agreement are intended nor shall be interpreted to provide or create any third-party beneficiary rights or any other rights of any kind in any other party.

 

21.10.

Counterparts.  This Agreement may be executed in one or more counterparts, each of which will be deemed an original, but which collectively shall constitute one and the same instrument.

 

21.11.

Independent Parties.  The relationship of SSN and Customer is that of supplier and customer and SSN is an independent contractor of Customer.  Neither Party nor their respective employees, consultants, contractors or agents are agents, employees, partners or joint venturers of the other

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Party, nor do they have any authority to bind the other Party by contract or otherwise to any obligation or liability.

 

21.12.

Dispute Resolution.  The Parties shall attempt in good faith to resolve all disputes under this Agreement (“Disputes”) promptly by negotiation as follows.  Any Party may give the other Party written notice of any Dispute not resolved in the normal course of business.  Executives of both Parties at levels one level above the individuals who have previously been principally involved in the Dispute shall meet at a mutually acceptable time and place within ten (10) days after delivery of such notice, and thereafter as often as they reasonably deem necessary, to exchange relevant information and to attempt to resolve the Dispute.  If the matter has not been resolved within thirty (30) days from the referral of the Dispute to senior executives or if no meeting of senior executives has taken place within fifteen (15) days after such referral, either Party may initiate such legal action as it deems appropriate.  If a negotiator intends to be accompanied at a meeting by an attorney, the other negotiator shall be given at least three (3) days’ notice of such intention and may also be accompanied by an attorney.  All negotiations pursuant to this Section 21.12 are confidential and protected from subsequent testimonial disclosures, and shall be treated as compromise and settlement negotiations for purposes of the Federal Rules of Evidence and state rules of evidence.

 

21.13.

Precedence.  The General Terms and Conditions and the Exhibits shall take precedence over any other or additional terms and conditions submitted by a Party in any Purchase Order, SOW or Change Order or similar document; provided, however, that such Purchase Order, SOW or Change Order may, with respect to the Products or Services to be provided thereunder, amend or override the terms set forth in the General Terms and Conditions or any Exhibit if such Purchase Order, SOW or Change Order specifically identifies the document and the specific terms such document intends to amend or override, and has been reviewed and approved by legal counsel for both Parties, as evidenced in writing on the final version of the Purchase Order signed by the Parties, which, in the case of Customer, must be signed by an Authorized Person.  Subject to the immediately preceding proviso, in the event of any conflict between the General Terms and Conditions and the provisions of any Exhibit, the General Terms and Conditions shall control.

 

21.14.

Utilization of Small Business Concerns.  

 

21.14.1.

If this Agreement offers subcontracting opportunities, both Parties agree to comply with 48 CFR 52.219-8, Utilization of Small, Service-Disabled Veteran-Owned Small Business, HUBZone Small Business, Small Disadvantaged Business and Woman-Owned Small Business Concerns and 48 CFR 52.219-9, Small Service-Disabled Veteran-Owned Small Business, HUBZone Small Business, Small Disadvantaged Business and Woman-Owned Small Business Subcontracting Plan.

 

21.14.2.

If SSN is classified by CPS Energy as a large business it will be required to furnish SSN’s subcontracting documents for any contracts expected to meet or exceed $550,000 ($1,000,000 for construction) prior to release of a Purchase Order by CPS Energy.  In such case, SSN shall adopt and deliver to CPS Energy a Subcontracting Plan for both large and small, non-minority, minority, HUBZone, service-disabled veteran and/or woman-owned businesses.  SSN also agrees to submit the Summary Subcontract Report Standard Form 294 or 295, in accordance with the instructions on the form and all supporting documentation as required by governmental directives in the terms of the contract between CPS Energy and the U.S. government.  The aforementioned documentation should be submitted to the CPS Energy Supplier Diversity Office, P.O. Box 1771, Mail Drop #110901, San Antonio, Texas 78296-1771, Attn: Supplier Diversity Coordinator.  SSN may be required to submit a copy to the Director of Small and Disadvantaged Business Utilization, General Services Administration, 18th & F Streets NW, Washington, DC 20405, upon his/her request.

 

21.15.

Local and Diverse Businesses.  SSN shall use good faith efforts to contract with businesses that are Local and Diverse for the procurement of materials and supplies related to SSN’s provision of

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Products and Services hereunder, and in connection with SSN’s completion of Economic Development Milestones, giving consideration to the level of use of Local and Diverse businesses by Customer, and in good faith giving preference to Local and Diverse business for such purposes; provided that (i) such businesses can demonstrate pricing and quality of goods and services comparable to that of SSN’s alternative suppliers, determined in SSN’s reasonable discretion, (ii) contracting with such businesses would not violate existing contracts or materially adversely affect existing supply chains and business relationships of SSN, and (iii) giving preference to Local and Diverse businesses is permitted by applicable law.  For purposes of this Section 21.15, SSN’s obligation to use good faith efforts shall be satisfied by engaging in a combination of some of the following, which SSN reasonably determines to be appropriate or necessary to facilitate the use of Local and Diverse businesses: (a) placing advertisements in appropriate trade publications and publications of wide general circulation designed to maximize the opportunity for Local and Diverse businesses to become aware of subcontracting opportunities with SSN; (b) posting Local and Diverse subcontracting opportunities on the City of San Antonio and Bexar County websites; (c) soliciting bids, proposals and qualification statements from Local and Diverse businesses listed on the City of San Antonio and Bexar County websites; (d) where commercially reasonable, seeking to subdivide work into smaller quantities to increase subcontracting opportunities for Local and Diverse businesses; (d) consulting with local trade associations or consultants that represent the interests of Local and Diverse businesses in order to identify qualified and available businesses; and (e) holding job fairs and supplier fairs as needed to fulfill the obligations described in this Section 21.15.  SSN shall consider in good faith recommendations by Customer to increase the participation levels of Local and Diverse businesses in SSN’s subcontracting opportunities.

 

21.16.

Specific Performance.  SSN acknowledges and agrees that Customer would be damaged irreparably in the event of any failure by SSN to perform any of the provisions of this Agreement, including achievement of the Economic Development Milestones, in accordance with their specific terms or if such provisions are otherwise breached by SSN.  Accordingly, SSN agrees that, notwithstanding anything herein to the contrary, Customer may seek an injunction or injunctions to prevent breaches of the provisions of this Agreement and to enforce specifically this Agreement and the terms and provisions hereof, in addition to any other remedy to which it may be entitled, at law or in equity.  Except where Customer reasonably believes that death, damage, or injury to persons or property will otherwise occur, Customer may seek an injunction or injunctions pursuant to this Section 21.16 only after observing any applicable cure period expressly afforded SSN under this Agreement.

 

21.17.

Conflicts of Interest.

 

21.17.1.

During the Term of this Agreement, SSN shall not knowingly undertake any new relationships with parties that could give rise to a Conflict of Interest without the written consent of CPS Energy.  A “Conflict of Interest” includes those conflicts which prevent SSN from professionally and ethically carrying out all terms of this Agreement.  Conflict of Interest includes an organizational Conflict of Interest, which exists when, because of other activities or relationships with third parties, SSN is unable or potentially unable to render impartial assistance, advice, Products or Services to CPS Energy, SSN’s objectivity in providing the Products and in performing the Services is or might be otherwise impaired, or SSN gains an unfair competitive advantage as a result of performance under this Agreement.

 

21.17.2.

SSN shall advise CPS Energy of any relationships creating a Conflict of Interest that arises during the Term of this Agreement of which it becomes aware.  If CPS Energy becomes aware of any such Conflict of Interest, through SSN’s disclosure or otherwise, CPS Energy has the option to terminate this Agreement without further liability to SSN and without application of the cure period set forth in Section 17.2, except to pay for Services actually rendered and Equipment or Software ordered and actually received by CPS Energy prior to such termination.  In CPS Energy’s sole discretion: (i) if it chooses to terminate this Agreement in accordance with this Section 21.17.2, CPS Energy may cancel this Agreement in whole, or any divisible portion thereof, without penalty or further obligation (subject to the

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immediately preceding sentence), and (ii) if CPS Energy decides to continue SSN’s performance under this Agreement, CPS Energy may limit the scope of SSN’s performance as it determines appropriate in light of the Conflict of Interest.

 

21.18.

Security.  

 

21.18.1.

Security Requirements.

 

21.18.1.1.

SSN shall take, at all times throughout the Term, security measures in a commercially reasonable effort to protect SSN’s computer systems, networks and databases, and the data processed, transmitted or stored thereon against the risk of penetration by, or exposure to, a third party via any system or feature utilized by SSN in performing such Services or accessing such systems.  ***, with the provisions of Exhibit U.  

 

21.18.1.2.

SSN shall promptly notify Customer in the event of a known or suspected material breach of security of a Customer system or database and SSN will furnish information regarding such breach sufficient for Customer to comply with any legal or regulatory requirements arising out of the event.  SSN shall use commercially reasonable efforts to promptly terminate any material and known security breaches or suspicious activity to the extent such breach or activity involves the System.  SSN shall use commercially reasonable efforts to prevent any material security breach or suspicious activity that affects the System from persisting for any amount of time or for any reason except as required by law, or as deemed reasonably necessary by SSN to determine the identity of the perpetrator and stop such breach or suspicious activity. 

 

21.18.1.3.

Within five (5) days following SSN’s discovery of the occurrence of a material security breach or suspicious activity affecting the System, SSN shall provide Customer with written documentation of the cause, remedial steps and future plans to prevent a recurrence of the same or similar breach or suspicious activity.  SSN shall reasonably cooperate with all security investigation activities of or on behalf of Customer and with the preparation and transmittal of any notice or any action that Customer may be required by law to give or perform regarding any known or suspected security breach, all associated costs of which shall be borne by SSN.  

 

21.18.2.

Security Review.  Customer may, from time to time, at Customer’s sole cost and upon reasonable prior written notice, perform a reasonable security review of the facilities from which the Systems are operated or hosted.  SSN agrees to meet with Customer to discuss the results of any such security review and SSN shall take any commercially reasonable corrective action to remedy any deficiencies that SSN agrees were identified by such review in accordance with this Agreement, including Exhibit U.

 

21.19.

***.  

 

21.19.1.

Within *** from the Effective Date, SSN shall provide Customer with a *** by SSN of this Agreement (other than *** that are beyond the reasonable control of SSN and are not caused, solely or in part, by *** of SSN) that remains ***.

 

21.19.2.

Prior to expiration of such *** (and then each year thereafter during the Deployment Period, with respect to any *** then in effect), SSN shall exercise its commercially reasonable efforts to determine whether one or more bond providers is willing to offer (i) a similar *** on better terms than the then *** and/or (ii) a *** in an amount greater than ***.   Not later than *** to the expiration of the then ***, SSN shall notify Customer as to

51


 

 

the results of its inquiries pursuant to the immediately preceding sentence, and Customer may, in its sole discretion, elect to *** on such better terms or with such greater (or, if Customer so elects, lesser) amount as a *** is willing to provide, or (iii) permit the existing *** to expire in accordance with its terms.  In no instance shall SSN be required to deliver to *** in an amount ***.  SSN shall, not later than *** prior to the expiration (excluding early expiration not caused by SSN, which time for replacement shall be governed by Section 21.19.3) of any ***, deliver to Customer any such new or replacement ***.  Failure by Customer to require that SSN obtain *** in respect of any *** shall not preclude Customer from requiring that *** in respect of ***.

 

21.19.3.

SSN shall ensure that the *** provided to Customer on the date hereof and, if applicable, each *** provided to Customer pursuant to Section 21.19.2 during the Deployment Period, remains valid and enforceable for a *** from the date of its delivery to Customer. In the event any *** expires or is terminated for any reason prior to the date that is *** from the date of delivery by SSN of such ***, SSN shall obtain a replacement *** meeting the requirements of this Section 21.19 within *** of such expiration or termination.   

 

21.19.4.

Where, pursuant to Section 21.19.2, Customer requires SSN to obtain a*** , Customer shall, solely with respect to *** in connection with the issuance of such ***.  All customary fees charged by any *** in connection with the issuance of any *** hereunder shall, with respect to the *** covered by each such ***, be paid by ***.

 

21.19.5.

If SSN fails to provide a renewal or replacement *** in accordance with the requirements of Section 21.19.2 or 21.19.3, SSN shall be *** and Customer may at any time *** until such time as SSN has re-instated, renewed or replaced the ***, as applicable, in compliance with the requirements of Section 21.19.2, at which time any amount previously ***, and for which Customer has no *** against SSN, shall be returned to SSN as promptly as practicable after receipt of SSN’s written request therefor.  Without limitation of Customer’s other rights under this Agreement, Customer shall have the right to, upon written notice to SSN, and subject to the limitations on liability expressly set forth herein, *** pursuant to Section 4.3 or Section 18.2), or in the event Customer suffers or incurs *** arising out of or relating to a *** under this Agreement.  Notwithstanding anything herein to the contrary, Customer shall be entitled to *** expressly afforded SSN in this Agreement.  Any *** by Customer pursuant to this Section 21.19.5 shall not be ***, reasonably estimates is owed to it by SSN under the Agreement, or that is necessary ***.

 

21.19.6.

*** shall be executed with the *** shall not be for an ***, all still subject to the final approval of Customer. ***, shall be accompanied by a ***, and shall include the date ***. If at any time during the term of a *** thereunder becomes ***, Customer shall have the right to require ***, which SSN shall furnish to the satisfaction of Customer within *** after notice to do so. ***.

[End of Terms and Conditions]

 

 

52


 

Execution Version

EXHIBIT A

MINIMUM INSURANCE REQUIREMENTS

 

1.01

SSN shall purchase and maintain in full force and effect, at its own expense, the following minimum insurance coverages and limits (provided, however, and notwithstanding any other provision herein, if the General Terms and Conditions require insurance coverage or limits that are greater than those listed below in this Exhibit, the requirements in the General Terms and Conditions shall control and shall be provided by SSN):

 

(a)

Statutory workers’ compensation and employer’s liability insurance with minimum limits of not less than indicated below.  SSN shall require Subcontractors to provide workmen’s compensation and employer’s liability insurance with the same minimum limits if appropriate for the size of the Subcontractor.  The policy must be in the name of SSN or contain an endorsement naming Customer as the Alternate Employer.

Required Limits – Statutory limits, with Employer’s Liability Coverage as follows:

 

Bodily Injury by Accident

$***

Bodily Injury by Disease Each Employee

$***

Bodily Injury by Disease Policy Limit

$***

 

(b)

Commercial General Liability Insurance, including the coverages identified below, with minimum limits indicated below.

 

Each Occurrence

$***

General Aggregate

$***

***

 

(to be maintained ***)

$***

 

(c)

The Commercial General Liability Policy will include the following coverages where applicable:

 

1.

Bodily injury & Property damage on an “Occurrence” basis

 

2.

Premises & Operations

 

3.

Independent Contractors

 

4.

Products/Completed Operations (to be maintained three years after Deployment Period)

 

5.

Personal Injury Liability

 

(d)

Business Automobile Insurance for all owned, non-owned, and hired vehicles.

 

Combined Single Limit BI & PD

$***

 

(e)

Excess Liability Coverage, following form, over Employer’s Liability, Commercial Liability, Commercial Automobile Liability Policies, with the limits shown below.

 

Excess Liability Coverage

$***

 

(f)

***:

 

***

$***

 

 

 

 


 

1.02

Each of SSN’s liability insurance policies shall be primary to and non-contributing with any other insurance carried by or for the benefit of the Customer or any other party required to be named as additional insured under this Agreement.  Any such insurance maintained by any additional insured shall be in excess of any insurance maintained by SSN.  Insurance may be provided under a single limit policy or under two or more policies with combined limits, the sum of which equals or exceeds the required amount of coverage.  If any insurance SSN furnishes is, ***, SSN agrees to *** to ensure that SSN has available at all times the coverage required hereunder.

1.03

SSN’s workers’ compensation, employer’s liability, commercial automobile liability, commercial general liability, and excess liability insurance policies shall be endorsed to waive all rights of subrogation in favor of Customer and its affiliates, and their shareholders, directors, officers, members, employees and agents.

1.04

Each Customer Indemnitee shall be included as additional insureds without limitation on all policies (except workers’ compensation and professional liability policies), under the form of additional insured endorsement providing the maximum protection to Customer and such persons allowed by applicable law.  Further, SSN represents and warrants that:

 

(a)

SSN’s policies of liability insurance, including SSN’s employer’s liability, commercial general liability, commercial automobile liability, and excess liability insurance policies have been endorsed to cover each Customer Indemnitee as additional insureds to the maximum extent permitted by applicable law with respect to liability arising out of Services performed by or at the request of SSN, including ongoing and completed operations in connection with this Agreement (and such coverage shall provide for the protection of each insured against claims of liability by another insured, under a severability of interests/cross liability clause).

 

(b)

Such insurance policies have also been***.

 

(c)

*** described in the *** in an amount equal to or greater than the *** from SSN *** provisions of the Agreement in respect of the***.

 

(d)

*** by or on behalf of SSN will be ***.  SSN shall not cause or permit its insurance to be canceled, reduced, restricted, limited, or invalidated.  

 

(e)

SSN has provided to Customer true and correct copies of the following:

 

(i)

current certificates of insurance describing each of the policies of insurance required hereunder; and

 

(ii)

all policy endorsements required hereunder.

1.05

All of SSN’s insurance shall be issued by insurance carriers licensed to do business in Texas at the time the policy is issued and rated by A.M. Best Company as A-VII or better, confirmed by one or more insurance certificates listing Customer’s name and address as a certificate holder, and listing the name of Project as described in this Agreement and the name and phone number of the broker who prepared the certificate.  Certificates of insurance shall be prepared on an Acord form 25-S.

1.06

With respect to any coverage maintained on a “claims-made” policy form, SSN shall maintain such coverage for *** following termination of this Agreement or completion of all Services associated with this Agreement, whichever is later; provided that, if a “claims-made” policy is maintained, the retroactive date must precede the date of commencement of Services under this Agreement.

Exhibit A – Customer’s Requirements of Insurance  

Page 2 of 3


 

1.07

Within *** of SSN’s receipt of notice that an insurance carrier has cancelled a policy, SSN shall notify Customer of such cancellation and provide a copy of the carrier’s notice of cancellation. Thereafter, Customer may, without prejudice to Customer’s rights under the Agreement, seek a continuation of the applicable coverage.

1.08

If SSN fails to obtain or renew the above required insurance and furnish to the Customer acceptable evidence thereof, then,***.

1.09

Nothing herein shall reduce or alter any obligation SSN has to indemnify, defend or hold harmless the Customer Indemnitees.

1.10

To the extent applicable law allows ***, SSN and/or its insurer agrees***.  This provision is independent and severable from any other provision of this Agreement and shall be enforceable as a separate agreement.

1.11

In the event SSN enters into a subcontract with a Subcontractor *** required to be maintained by SSN under this Agreement.  SSN will require *** and copies of this evidence shall be provided to Customer by SSN.

1.12

SSN shall not allow any endorsements to be included with any of the policies required herein that would adversely affect or limit the coverages to be provided by such policies as required herein.  SSN and, as applicable, the Subcontractors shall bear all risks and be responsible for any uninsured loss due to policy deductibles, self-insured retentions, exclusions, limitation inadequacy and/or absence of coverage, whether such policies are purchased by SSN, Subcontractor and/or Customer.

1.13

SSN and its Subcontractors shall not commence the shipment of equipment or materials or commence the Services until all of the insurance coverage required of SSN and its Subcontractors is in force and the necessary certificates and statements pursuant to the Agreement, including Exhibit A, have been received and approved by Customer. Such approval shall not be unreasonably withheld, conditioned or delayed.

 

 

 

Exhibit A – Customer’s Requirements of Insurance  

Page 3 of 3


 

Execution Version

EXHIBIT B: PART 1

PRICING & EXECUTION MILESTONES

Milestones

The target milestones are subject to change upon the Parties' mutual agreement and will be managed in accordance with the change control processes outlined in the General Terms and Conditions and Exhibit J. For the avoidance of doubt, where there exists any inconsistency between the “billing triggers” set forth in this Exhibit and Section 9 of the General Terms and Conditions, such Section 9 shall prevail.

 

AMI Milestones

 

 

 

 

Milestone

Responsible

Party

Target/Actual

Completion Date

Billing Trigger

***

***

***

***

***

***

***

***

***

***

***

***

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