1
Exhibit 10.13
SERVICES AGREEMENT
This Agreement is made as of this 25th day of October 1995 between
CMS NOMECO Oil & Gas Co., a Michigan corporation ("CMS NOMECO") and CMS
Enterprises Company, a Michigan corporation ("CMS Enterprises").
R E C I T A L S
WHEREAS, CMS NOMECO is a subsidiary of CMS Enterprises, which in turn
is a subsidiary of CMS Energy Corporation, a Michigan corporation;
WHEREAS, CMS Enterprises desires, from time to time, to provide
services to CMS NOMECO;
WHEREAS, CMS NOMECO desires, from time to time, to purchase services
from CMS Enterprises; and
WHEREAS, CMS Enterprises is willing to perform such services as CMS
NOMECO may from time to time request on the terms and conditions contained
herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the parties agree as follows:
1. SCOPE OF SERVICES. CMS Enterprises shall perform for CMS NOMECO,
under the terms of this Agreement, such administrative, clerical, managerial,
professional and/or technical services as the parties may from time to time
agree by executing an intercompany service request ("ISR") as hereinafter
provided (a copy of an ISR is attached hereto as Exhibit I). In the event CMS
NOMECO desires CMS Enterprises to perform any such services, then the services
desired, the time for their performance, and any other specific requirement
(not inconsistent with the Agreement) relating thereto, shall be described in
an ISR signed by an officer or other authorized person of CMS NOMECO and
delivered to CMS Enterprises. Upon receipt of such ISR, CMS Enterprises shall
make all of the necessary cost estimates and supply all other information
required by the ISR. ISRs shall not become effective and binding until a
completed copy thereof is signed by an officer or other authorized employee of
both CMS NOMECO and CMS Enterprises, at which time the ISR shall be deemed to
become part of this Agreement; provided, however, that in case of a
discrepancy between any provision in the ISR and any provision of this
Agreement, this Agreement shall prevail. Unless otherwise provided in this
Agreement or such ISR, CMS Enterprises shall provide everything necessary to
perform the services requested thereunder, including, but not limited to, all
supervision, personnel, supplies, services and transportation. CMS NOMECO
reserves the right to have similar or like services performed by others or
through its own employees.
2. TERM OF AGREEMENT. This Agreement shall become effective as of the
date hereof and continue until terminated by either party, at the terminating
party's convenience,
2
by at least thirty (30) days' written notice to the non-terminating party. The
terms of this Agreement shall remain in effect as to each such uncompleted ISR
until the services thereunder are completed or it is terminated by CMS NOMECO
under Section 12, "Termination." The terms of Section 14, "Ownership and
Confidentiality" shall survive termination of this Agreement for a period of
five (5) years after all other terms hereof expire.
3. PRICE OF SERVICES. CMS NOMECO will pay to CMS Enterprises and CMS
Enterprises will accept as full compensation, satisfaction and payment for said
services the rates and charges set forth in the applicable ISR.
4. PAYMENTS. Within twenty (20) days after the end of each calendar
month, CMS Enterprises shall submit to CMS NOMECO an invoice respecting all
ISRs, itemized to CMS NOMECO's reasonable satisfaction, for the services
performed under such ISRs during the prior month, together with the amount
due. Within thirty (30) days after receipt of each properly-itemized and
supported invoice payment of such invoice shall be made to CMS Enterprises.
Payment of such invoice by CMS NOMECO shall not constitute acceptance of the
services and shall be subject to correction in the payment of any subsequent
invoice. With each invoice, CMS Enterprises shall submit copies of all
vendors' and subcontractors' invoices for amounts greater than $10,000 for
which reimbursement is sought. Credit shall be given to CMS NOMECO for any
discounts received by CMS Enterprises on all reimbursable invoices.
5. CHANGES IN THE SERVICES. Changes to any ISR issued hereunder may only
be made pursuant to a written change order signed by an officer or authorized
person of each party. Except as provided below, no claims for compensation for
additional services shall be valid unless authorized by such written change
order; provided, however, that whenever it is necessary to immediately
authorize extra work to respond to emergency conditions, CMS Enterprises shall
be entitled to perform services in reliance on an oral or written authorization
by one of CMS NOMECO's officers or other authorized representatives previously
identified to CMS Enterprises, and a written change to the ISR shall be made
covering such services as soon thereafter as is reasonably practicable.
6. INDEPENDENT CONTRACTOR. In the performances of services hereunder, CMS
Enterprises shall be an independent contractor with the sole authority to
control and direct such performance.
7. PERMITS AND LAWS. CMS Enterprises shall secure all licenses or permits
required by law and shall comply with all applicable ordinances, laws, orders,
rules and regulations, pertaining to its performance of services hereunder.
8. WARRANTY AND REMEDY. Services performed directly by CMS Enterprises
shall be performed in a careful and competent manner by properly trained and
skilled personnel. CMS Enterprises HAS NOT MADE AND DOES NOT HEREBY MAKE ANY
OTHER WARRANTIES, EXPRESS, IMPLIED OR STATUTORY AS TO THE SERVICES PERFORMED,
INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR
ANY PURPOSE. In the event any service
2
3
performed directly by CMS Enterprises fails to conform to the above warranty,
CMS Enterprises will re-perform said service at its expense if CMS NOMECO gives
CMS Enterprises notice of such non-conformance within one (1) year after
performance of the non-conforming service. As to services performed by
subcontractors and vendors, CMS Enterprises shall on the request of CMS NOMECO
assign to CMS NOMECO any assignable warranties obtained by CMS Enterprises.
The foregoing states CMS NOMECO's sole and exclusive remedies hereunder.
9. LIMITATION ON LIABILITY. Notwithstanding any other provision of this
Agreement, in no event shall CMS Enterprises' liability to CMS NOMECO under
this Agreement exceed the compensation paid by CMS NOMECO to CMS Enterprises
for that portion of the services giving rise to the claim and in no event shall
the total of all such liabilities of CMS Enterprises exceed the total dollar
amount paid to CMS Enterprises under this Agreement. Further, in no event
shall CMS Enterprises be liable for any special, indirect, incidental or
consequential damages of any nature on account of this Agreement.
10. CHANGES TO AGREEMENT; ASSIGNMENT AND SUBCONTRACTING. The terms of
this Agreement shall not be changed, superseded or supplemented except in
writing signed by an officer of each party. This Agreement shall not be
assigned or any part thereof subcontracted by CMS Enterprises without CMS
NOMECO's previous written consent. Any attempted assignment without such
written consent shall be void and CMS NOMECO may refuse to permit the
performance of any unauthorized subcontract. In case any such subcontracting
is approved, the subcontract shall be in writing and shall be fully executed
prior to the commencement of the services involved. If required by CMS NOMECO
to do so, CMS Enterprises shall promptly furnish CMS NOMECO with copies of each
executed subcontract. Any professional engineering services to be provided
under this Agreement shall be performed by an entity or individual qualified to
practice professional engineering in any jurisdiction or jurisdictions in which
such qualification is required in order for the services to be provided.
11. AUDITING OF CMS ENTERPRISES' ACCOUNT AND REFUNDS. CMS Enterprises
shall make and keep, as the same accrue, full and complete records and books of
account of its costs, expenses, man-hours and equipment hours relating to the
services hereunder in accordance with generally accepted accounting practices
and CMS Enterprises' record retention policy in effect for such records
whenever, by the terms of this Agreement, CMS Enterprises' compensation shall
be based wholly or partially on such costs, expenses, man-hours or equipment
hours. When relevant to determining CMS Enterprises' compensation hereunder,
said records and books of accounts shall be open to examination during regular
business hours by CMS NOMECO or its agents for the purpose of inspecting,
auditing, verifying or copying the same or making extracts therefrom. CMS
NOMECO's payment of invoices hereunder shall not constitute acceptance of the
accuracy thereof. Amounts paid with respect to any ISR shall be subject to
audit in accordance with this section for one (1) year after the making of the
last payment under the ISR. Whenever an audit of CMS Enterprises' records
shows that CMS NOMECO is entitled to a refund or CMS Enterprises is entitled to
additional payment, CMS Enterprises or CMS NOMECO, as the case may be, shall
promptly make said refund or additional payment with interest, compounded
annually, at the prime rate established by the National Bank of Detroit from
time to time or at the highest rate permitted by law, whichever
3
4
is less, from the date the erroneous payment was made to CMS Enterprises. Each
party shall bear its own costs in connection with any such audit and billing
error correction.
12. TERMINATION. Notwithstanding anything in this Agreement to the
contrary, should CMS NOMECO for any reason desire to suspend or stop the
services under any ISR hereunder at any time before the services have been
completed, CMS Enterprises shall stop performing the services upon notice from
CMS NOMECO. Any such termination shall be without prejudice to any other rights
or remedies of CMS NOMECO for any breach of this Agreement by CMS Enterprises.
CMS Enterprises shall, upon the effective date of such notice of termination,
if requested by CMS NOMECO, immediately cease performance of the services and
remove its employees, representatives, tools, equipment and other property from
CMS NOMECO's premises. If CMS Enterprises fails to effect such removal within
a reasonable time, CMS NOMECO may do so at CMS Enterprises' expense. In the
event of such termination, payment for all services properly performed through
the date of such termination shall be made in accordance with the rates and
charges set forth in the applicable ISR, subject to proper deductions for
defective services, damages or costs recoverable under this Agreement by CMS
NOMECO by reason of any default, breach or failure to perform by CMS
Enterprises. Upon any termination pursuant to this section, CMS NOMECO shall
be released from all further obligations under any ISR so terminated except for
payment as provided for in this section and such liability or other obligations
as have accrued as of the time of termination.
13. NOTICES AND OTHER COMMUNICATIONS. Whenever notices, invoices,
payments, or other communications are required or permitted hereunder,
the same may be given, made or delivered by mail address as follows:
CMS NOMECO Oil & Gas Co. CMS Enterprises Company
One Jackson Square Fairlane Plaza South, Suite 1000
P. O. Box 1150 330 Town Center Drive
Jackson, Michigan 49204 Dearborn, MI 48126
Attention: Corporate Secretary Attention: Treasury Dept.
(for payments)
General Accounting
(for all other notices)
or to such other address as the addressee shall have specified in writing.
14. OWNERSHIP AND CONFIDENTIALITY. "Confidential Information" shall mean
(i) all documents, records, data and other information furnished to CMS
Enterprises in any form in connection with the performance of the services
contemplated hereunder and any copies thereof, and (ii) all documents, records,
data and other work product produced by CMS Enterprises for CMS NOMECO in
performance of the services contemplated hereunder and copies thereof.
Confidential Information is, and shall continue to be, the property of CMS
NOMECO. CMS Enterprises shall, to the extent permitted by law, upon written
request from CMS NOMECO, immediately deliver to CMS NOMECO or destroy, at CMS
NOMECO's option, all Confidential Information. CMS Enterprises shall not
disclose any Confidential Information or the content thereof to any party
except those CMS Enterprises' employees or agents who need to have access to
such Confidential Information unless ordered by court,
4
5
administrative agency or other governmental body having jurisdiction. If CMS
Enterprises becomes aware that any party is attempting to obtain any such
order, CMS Enterprises shall immediately notify the following person:
General Counsel
CMS NOMECO Oil & Gas. Co.
One Jackson Square
P. O. Box 1150
Jackson, Michigan 49204
or such other person as CMS NOMECO may have designated in writing.
CMS Enterprises acknowledges that disclosure of Confidential
Information in violation of this Agreement may cause CMS NOMECO irreparable
damage and hereby consents to the issuance of an injunction by any court of
competent jurisdiction prohibiting any disclosure of Confidential Information
in violation of this Agreement. Such right to injunctive relief is in addition
to all other remedies available to CMS NOMECO at law or in equity. CMS
Enterprises shall inform all employees who have access to Confidential
Information of the obligations referred to above and require their compliance
with the provisions of this Agreement.
15. GOVERNING LAW. This Agreement shall be deemed to be a Michigan contract
and shall be construed in accordance with and governed by the laws of the State
of Michigan.
16. HEADINGS. The section headings in the Agreement are included for
reference only. They shall not affect the interpretation and construction of
this Agreement.
17. ENTIRE AGREEMENT. With respect to the subject matter hereof, this
Agreement supersedes all previous agreements, representations, understandings
and negotiations, either written or oral, between the parties hereto or their
representatives, and constitutes the entire agreement between the parties.
IN WITNESS WHEREOF, the parties hereto have entered into this
Agreement as of the day and year first written above.
CMS NOMECO OIL & GAS CO. CMS ENTERPRISES COMPANY
By:__________________________ By:__________________________
Title:_______________________ Title:_______________________
5