exv10w36



 





Exhibit 10.36




STATEMENT OF WORK # 1




between




HILLWOOD ENTERPRISES L.P.




and




PEROT SYSTEMS CORPORATION




Dated as of April 11, 2001




 









 








Supporting Schedules to Statement of Work #1




	 	 	 	 	 
	Schedule Name
	 	Schedule Number

	Hillwood Hardware
	 	 	1.1	 
	Hillwood Network
	 	 	1.2	 
	Hillwood Software
	 	 	1.3	 
	Hillwood Sites
	 	 	1.4	 
	Standard Configuration
	 	 	1.5	 
	Key Positions
	 	 	2.2	(a)
	Transferred Employees
	 	 	2.2	(b)
	Third Party Service Contracts
	 	 	2.2	(c)
	Base Services
	 	 	3.1	(a)
	Service Levels and Service Level Credits
	 	 	3.2	 
	Base Services Charges
	 	 	5.1	 
	Additional Project Services Rates
	 	 	5.2	 
	Termination Fee
	 	 	6.2	(a)







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STATEMENT OF WORK #1



This Statement of Work #1 (the “Statement of Work”) dated April 11, 2001 (the
“Statement of Work Agreement Date”), by and between Hillwood Enterprises, L.P.,
a Texas limited partnership (“Hillwood”) and Perot Systems Corporation (“Perot
Systems”), a Delaware corporation.




Recitals



Whereas, Perot Systems and Hillwood entered in the Master Agreement for
Information Technology Services, effective as of April 1, 2001 (the
“Agreement”), under which the parties may from time to time enter into
Statements of Work for the provision of Services by Perot Systems for the
benefit of certain of Hillwood.



Whereas, Perot Systems and Hillwood desire to enter into this Statement of Work
pursuant to which Perot Systems will provide the Base Services described in
this Statement of Work to Hillwood in support of Hillwood Sites specifically
identified in this Statement of Work;



Now, therefore, the parties agree as follows:




Article 1.0  Definitions





	1.1	 	Certain Defined Terms. For purposes of this Statement of Work, the
following terms have the following definitions.
	 
	 	 	“Additional Project Services” shall have the meaning set forth in Section
3.1(b).
	 
	 	 	“Additional Project Services Rates” shall be the Perot Systems’ rates for
Additional Project Services and will be as set forth in Schedule 5.2.
	 
	 	 	“Base Services” shall means the services described in Section 3.1(a).
	 
	 	 	“Base Services Metrics” shall have the meaning set forth in Section 5.4.
	 
	 	 	“Extended Term” shall have the meaning set forth in Section 6.4.
	 
	 	 	“Initial Term” shall have the meaning set forth in Section 6.1.
	 
	 	 	“Growth Matrix” shall be the chart in Schedule 1.1 to this Statement of
Work that provides for adjustments to the Base Services charges due to
growth or decline in different categories that Perot Systems supports as
part of the Base Services.
	 
	 	 	“Hillwood Hardware” shall mean the hardware described in Schedule 1.1 to
be supported by Perot Systems as part of the Base Services.




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	 	 	“Hillwood Network” shall mean the network hardware and equipment
described in Schedule 1.2 to be supported by Perot Systems as part of the
Base Services.
	 
	 	 	“Hillwood Sites” shall mean the locations listed in Schedule 1.4 that
Perot Systems will support as part of the Base Services.
	 
	 	 	“JDE Applications” shall mean the description of Hillwood’s J.D. Edwards
financial applications provided in Schedule 1.3.
	 
	 	 	“Metrics Threshold” shall have the meaning given in Section 5.4.
	 
	 	 	“Service Level Credits” shall have the meaning given in Section 5.3.
	 
	 	 	“Standard Configuration” shall have the meaning described in Schedule
1.5.
	 
	 	 	“Supported System” shall mean the Hillwood Hardware and Hillwood
Software.
	 
	 	 	“Statement of Work Agreement Date” has the meaning set forth in the
preamble.
	 
	 	 	“Statement of Work Effective Date” has the meaning set forth in Section
6.1.
	 
	1.2	 	Terms Defined in the Agreement. Except as otherwise defined herein, all
capitalized terms used herein shall have the same meaning as in the
Agreement.





Article 2.0  Agreement





	2.1	 	The Agreement. The terms of the Agreement will apply to the activities
contemplated by this Statement of Work unless otherwise specifically
stated in this Statement of Work.
	 
	2.2	 	Agreement Terms. For purposes of the Agreement, the following terms will
have the meanings specified below with respect to this Statement of Work:






	 	(a)	 	“Key Positions” under this Statement of Work shall be those
set forth on Schedule 2.2(a).
	 
	 	(b)	 	“Transferred Employees” under this Statement of Work shall be
those set forth on Schedule 2.2(b)
	 
	 	(c)	 	“Third Party Service Contracts” under this Statement of Work
shall be those set forth on Schedule 2.2(c).




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Article 3.0 Services and Service Levels





	3.1	 	Services.






	 	(a)	 	Base Services. Perot Systems will provide to Hillwood the
Services as described in Schedule 3.1(a) (the “Base Services”)
using the Supported System, which shall be connected to the Hillwood
Sites via the Hillwood Network.
	 
	 	(b)	 	Additional Project Services. If Hillwood requests Perot
Systems to provide services outside of the scope of the Base
Services (“Additional Project Services”), and Perot Systems agrees
to provide them, then the parties will enter into a Change Order
under the Change Control Process or a new Statement of Work, as
applicable. The Change Order shall describe the Additional Project
Services and the terms (in addition to the terms of this Statement
of Work and the Agreement) under which Perot Systems shall provide
such Additional Project Services. Such Change Order may have terms
and conditions contained within it that are different than those
within this Statement of Work, in which case the terms of the Change
Order will prevail.






	3.2	 	Service Levels. Perot Systems will measure the performance of the Base
Services against the Service Levels forth in Schedule 3.2. The Service
Levels shall be adjusted by mutual agreement for Changes in the Base
Services Metrics as described in Section 5.4 of this Statement of Work and
other external factors beyond Perot Systems’ control in accordance with
the Change Control Process.
	 
	3.3	 	Third Party Service Providers. If Hillwood uses a third party to perform
any services that relate to the Supported System or the Hillwood Network,
Hillwood will not allow the third party to make any changes that will
affect the Supported System or Hillwood Network without first obtaining
the parties approval of the changes in accordance with the Change Control
Process including agreeing to any adjustments to the Service Levels and
the charges for the Base Services.
	 
	3.4	 	Transferred Employees. Perot Systems will not cause more than one of the
Transferred Employees to be assigned to any account other than Hillwood
during any four-month period during the Initial Term without Hillwood’s
prior written consent, provided that such consent will not be unreasonably
withheld. Notwithstanding the provisions of Section 20.7 of the
Agreement, Hillwood may offer employment to the Transferred Employees upon
the expiration or termination of this Statement of Work for any reason,
without the prior written consent of Perot Systems.
	 
	3.5	 	Assignment of Employees. Any new Perot Systems personnel assigned to
provide Services to Hillwood on a permanent, full-time basis shall (i)
execute a confidentiality agreement in the form of Schedule 19 attached to
the Agreement and (ii) be made only with the prior consent of Hillwood,
provided that such consent shall not be unreasonably withheld.





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Article 4.0 Hillwood’s Obligations





	4.1	 	Right of First Refusal. Hillwood shall offer Perot Systems a right of
first refusal for Additional Project Services for information technology
services in excess of $150,000 interfacing with or relating to the Base
Services being provided by Perot Systems pursuant to this Statement of
Work or Additional Project Services under any Task Order. Hillwood shall
have no responsibility to offer such Additional Project Services to Perot
Systems if all work will be performed by Hillwood’s employees or if Perot
Systems declines to match any competitive bid received by Hillwood for
said Additional Project Services. Hillwood will provide Perot Systems
with a copy of the request for competitive bid prior to submittal to third
parties. Perot Systems shall notify Hillwood of its willingness to match
any competitive bid received by Hillwood from third parties within 10
business days of Hillwood’s notification of the competitive bid to Perot
Systems or Perot Systems will waive its right to first refusal in regard
to the services covered by the competitive bid.





Article 5.0 Payments





	5.1	 	Charges. Hillwood will pay to Perot Systems for the Base Services
provided under this Statement of Work the amounts set forth in Schedule
5.1 at the times set forth in Schedule 5.1. The Base Services charges are
not subject to the cost of living adjustment as set forth in Section 11.2
of the Agreement. If at any time during the term of the Statement of
Work, Perot Systems reasonably demonstrates to Hillwood that it is not
then making a profit on the Base Service Charges on a fully allocated cost
basis, and Hillwood is unwilling to adjust the charges to enable Perot
Systems to make a profit on a fully allocated cost basis, then Perot
Systems may terminate the Statement of Work on thirty (30) days notice.
If at any time during the term of the Statement of Work, Hillwood
reasonably demonstrates to Perot Systems that the Base Service Charges are
not market competitive, and Perot Systems is unwilling to adjust the
charges to make them market competitive, then Hillwood may terminate the
Statement of Work on thirty (30) days notice. Notwithstanding any term
providing otherwise in this Statement of Work or the Agreement, if either
party terminates this Statement of Work pursuant to this Section 5.1, (i)
Perot Systems will provide to Hillwood the termination assistance
described in Section 19.5 of the Agreement at no additional charge to the
Base Service Charges and (ii) Hillwood will have no obligation to pay the
termination fee set forth in Schedule 6.2(a).






	5.2	 	Charges for Additional Project Services. Unless otherwise specifically
provided in a Change Order, Hillwood will pay Perot Systems for the
Additional Project Services provided under a Change Order on a time and
materials basis at the Additional Project Services Rates set forth in
Schedule 5.2. Unless otherwise specifically provided in a Change Order,
Perot Systems will deliver an invoice to Hillwood for Additional Project
Services, and each such invoice will be due in accordance with Article 12
of the Agreement.




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	5.3	 	Service Level Credits. Subject to the limitations in Article 17 of the
Agreement, Perot Systems shall issue to Hillwood, Service Level Credits as
specified in Schedule 3.2, based on Perot Systems’ performance of the Base
Services in relation to the Service Levels.






	5.4	 	Base Services Metrics. The charges for the Base Services and the Service
Levels for the Base Services are based upon the assumption that each of
the following components that comprise the Base Services metrics
(collectively, the “Base Services Metrics”) will not be modified or
changed in any manner other than the allowances provided for in the Growth
Matrix, if applicable, during the Initial Term from the quantities,
categories or descriptions of each Base Service Metric described in its
respective Schedule as of the Statement of Work Effective Date (the
“Metric Threshold”).






	 	•	 	The quantity or category of Hillwood Hardware described in
Schedule 1.1, subject to the Growth Matrix provided in Schedule 1.1.
	 
	 	•	 	The quantity or category of Hillwood Network equipment as
described in Schedule 1.2.
	 
	 	•	 	The quantity, category or manufacturer of Hillwood Software
described in Schedule 1.3.
	 
	 	•	 	The Hillwood Sites identified in Schedule 1.4.
	 
	 	•	 	The Standard Configuration set forth in Schedule 1.5.
	 
	 	•	 	The number of or Hillwood’s obligations under the Third Party
Contracts identified in Schedule 2.2(c).






	 	 	If any of the components of Base Services Metrics are changed or modified
in any manner, other than the allowances provided for in the Growth
Matrix, if applicable, during the Initial Term, the parties agree that
(i) the charges for the Base Services and Service Levels will be adjusted
by the parties in accordance with the Change Control Process, (ii) until
such adjustments are made, Perot Systems will incur no liability for and
will be relieved from its obligation to pay Service Level Credits, and
(iii) Perot Systems will not be obligated to provide Base Services in
support of that portion of the component of the Base Services Metrics
that exceeds the Metric Threshold.





Article 6.0 Term and Termination





	6.1	 	Initial Term. The initial term (“Initial Term”) of this Statement of
Work shall commence as of April 16, 2001 (the “Statement of Work Effective
Date”) and shall expire on the third anniversary of the Statement of Work
Effective Date, unless terminated earlier in accordance with this Article
6.0 or Article 19 of the Agreement.






	6.2	 	Additional Termination Rights. In addition to the termination rights in
Article 19 of the Agreement, Hillwood will have the rights to terminate
this Statement of Work as described below:




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	 	(a)	 	Termination for Convenience. Hillwood will have the right at
any time to terminate this Statement of Work for convenience by
providing Perot Systems with 60 days prior written notice of
termination and by paying Perot Systems the termination fee set
forth in Schedule 6.2(a) prior to such termination date.
Notwithstanding the provisions of Section 19.5 of the Agreement, if
Hillwood terminates this Statement of Work in accordance with this
Paragraph, Perot Systems shall provide Hillwood the termination
assistance described in Section 19.5 of the Agreement at no
additional charge to the Base Service charges provided that Perot
Systems can reasonably provide termination assistance with the same
personnel responsible for providing the Base Services at the time of
termination. To the extent Perot Systems is reasonably required to
use personnel other than those responsible for providing the Base
Services at the time of termination, Perot Systems will make such
additional personnel available at Perot Systems’ then commercial
rates.
	 
	 	(b)	 	Termination for Service Level Failures. In the event that
Perot Systems fails to meet the Service Levels set forth in Schedule
3.2 for four (4) consecutive months, Hillwood shall have the right
to terminate this Statement of Work by providing Perot Systems 30
days prior written notice of termination. In no other event shall
the failure of Perot Systems to perform in accordance with the
Service Levels give rise to the right of Hillwood to terminate the
Agreement, subject to the provisions of Article 7.4 of the
Agreement.






	6.3	 	Extension. If Hillwood desires to extend this Statement of Work beyond
the Initial Term, Hillwood shall give Perot Systems written notice thereof
not later than 60 days prior to the expiration date of the Initial Term.
If Hillwood desires to extend this Statement of Work beyond any such
subsequent extension term, Hillwood shall give Perot Systems written
notice thereof not later than 60 days prior to the expiration date of such
term. Upon receipt by Perot Systems of any such notice from Hillwood, the
parties shall then negotiate in good faith for a mutually agreeable
extension term and, if they reach mutually acceptable terms and conditions
for such extension, the parties shall execute a written agreement for such
extension.





Article 7.0 General





	7.1	 	Section, Schedule and Exhibit References. Except as otherwise
specifically provided in this Statement of Work, Section, Exhibit and
Schedule references are references to Sections, Exhibits and Schedules in
or to this Statement of Work.





Article 8.0 Proprietary Rights





	8.1	 	Deliverables. Neither party anticipates any developed software or other
deliverables (“Deliverables”) under this Statement of Work. To the extent
that the parties agree to Deliverables, the terms and conditions regarding
such Deliverables are subject to the Change Control Process.




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     WHEREUPON, the parties have executed this Statement of Work on the
Statement of Work Agreement Date through their duly appointed and authorized
representatives.



	 	 	 
	Hillwood Enterprises L.P.

	 	Perot Systems Corporation
	 
	 	 
	By: /s/ J. Woods

	 	By: /s/ Allen Christianson
	 
	 	 
	Name: Jonas Woods

	 	Name: Allen Christianson
	 
	 	 
	Title: Executive Vice President

	 	Title: Emerging Industries Central Area Manager








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