SERVICE LEVEL AGREEMENT
1. INTRODUCTION
This Agreement outlines
the terms and conditions under which the Supplier will provide specified
Services (collectively referred to as “the Services”) to its Client or its
Affiliates. The objective is to provide a basis and framework for the delivery
of high quality services that meet the needs of the Client
This Agreement is made
between [specify name of
Supplier] (hereinafter referred to as “the Supplier”) of [specify address of Supplier],
and [specify name of Client]
(hereinafter referred to as “the Client” of [specify address of Client].
1.3 Commencement Date
This Agreement will commence on [specify commencement date].
This
Agreement is for an initial [specify
no. of months] month period and is automatically renewable for a further
twelve month period at the end of this initial period
and on each subsequent anniversary of the Commencement Date unless 180 days
prior written notice is received to terminate the Agreement by either party.
It is understood and
agreed that this Agreement does not grant to the Supplier any exclusive rights
to do business with the Client and also that the Client may contract with other
suppliers for the procurement of similar services. Nothing in the Agreement
prevents the Supplier from marketing, developing, using and performing similar
services or products to other potential clients.
1.6 Definitions
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“Affiliate” means a subsidiary organisation, sister organisation or an
organisationally connected entity to either party.
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“Benchmarks, targets and
metrics” means the agreed numeric criteria against
which performance under this Agreement is to be measured.
-
“Change control procedures” means the agreed process to be followed when changes are required
either to this Agreement or to the Services.
-
“Commencement date” means the date that the Agreement is considered to be effective.
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“Defective or inadequate
performance” means the delivery of services where
the performance levels do not meet an agreed minimum criteria.
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“Disclosing party” means the party who has disclosed confidential information to the
other party.
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“Initial period” means the Agreement period from the commencement date to the first
renewal date.
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“Intellectual property
rights” mean the registered or non-registered
ownership of patents, trademarks, registered design, know-how or copyright.
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“Key personnel” means those persons employed by the Supplier who have a key role in
the delivery of the services to the Client.
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“Non-standard services” means those services, which are customised to meet the requirements
of the Client.
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“Place of service delivery” means the address or addresses of the Client’s or Supplier’s
premises where the Service delivery is deemed to take place.
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“Problem escalation” means the agreed procedure for alerting and notifying increasingly
senior members of the Supplier’s management of the non-resolution of problems.
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“Problem management” means the agreed procedures for providing support and problem
resolution services to the Client.
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“Professional fees” means the remuneration or compensation, other than reimbursable
expenses, due to the supplier for the provision of the Services.
-
“Receiving party” means the party who has received confidential information from the
other party.
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“Service availability” means the times and periods that the Supplier will make the
Services available to the Client.
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“Service component” means a divisible and identifiable part of the overall Services to
be delivered.
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“Service review meetings” mean regular meetings that are held between representatives of the
Supplier and the Client specifically to discuss issues arising from the
delivery of the Services including the performance of the Service delivery
-
“Specified services” means those Services that are specified in Schedule A and Schedule
B of this Agreement.
-
“Standard services” mean those Services that the Supplier delivers to its Clients
without significant customisation.
-
“Support and Service desk
services” mean the specified support services
provided by the Supplier to the Client to assist the Client’s personnel to understand,
operate and execute the delivered Services.
2.
SCOPE
OF WORK
Standard services to be
delivered under this Agreement are as listed, described and specified in
Schedule A to this Agreement.
Non-standard services
to be delivered under this Agreement are as listed, described and specified in
Schedule B to this Agreement.
2.3 Service Availability
The availability,
operational reliability and response times of the Services to be delivered
under this Agreement are as specified in Schedule C to this Agreement.
The
Services covered by this Agreement are to be delivered at the address, or
addresses, given in Schedule D to this Agreement.
Either party may
propose changes to the scope, nature or time schedule of the Services being
performed under this Service Level Agreement. The parties will mutually agree
to any proposed changes, including adjustments to fees and expenses as a result
of any changes to the Services. All changes are to be subject to the change
control procedures included in Schedule E to this Agreement and must be approved
in writing by both parties.
2.6 Client delays to Services
The Supplier will be
entitled to an adjustment to any penalties or refunds due in respect of
inadequate performance if the Supplier is prevented from performing specific
Services for any reasons beyond the control of the Supplier which are caused by
the Client.
3.1 Key
Personnel Changes
Key
personnel are not required to be specifically named within this Agreement but
the Supplier will notify the Client in advance of changes to any key personnel
that could affect the delivery of the Services to the Client.
3.2 How
each service will be monitored
The performance of each
individual Service will be monitored. The methodology to be used in each case
is outlined in Schedule F to this Agreement.
The benchmarks, targets
and metrics to be used in the measurement of performance levels are defined in
Schedule F to this Agreement.
3.4 Service
Level Reporting
Reports on actual
service levels achieved will be provided to the Client on a monthly basis. This
will cover each service component delivered and the performance achieved
compared with target. These reports are to be provided to the Client within ten
working days after the end of each month. The reports required in support of
this Agreement are defined in Schedule G to this Agreement.
3.5 Service
Review Meetings
Service Review meetings
will be held on quarterly basis at the Client’s offices. The issues to be
covered will include (as applicable):
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Service performance levels
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Support performance levels
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Installation performance
-
Equipment issues
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System issues
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Compensation issues
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Administrative Issues
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Security Issues
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Changes proposed
4.1 Support
and Service desk Services
The
Supplier will provide ongoing assistance to the Client to support the Services
provided. This will include comprehensive Service desk facilities and On-site
Maintenance and Support services. The Service desk and On-site Maintenance and
Support services are defined in Schedule H to this Agreement
The following standard
problem definitions will apply to the services provided under the terms of this
Agreement.
Problem Priority
|
Status
|
Impact
|
Priority 1
|
Mission critical
|
Serious financial impact
|
Priority 2
|
Extremely urgent
|
Significant financial impact
|
Priority 3
|
Urgent
|
Medium financial impact
|
Priority 4
|
Medium priority
|
Minimal financial impact
|
Priority 5
|
Low Priority
|
No financial impact
|
4.3 Problem Escalation
To
ensure that the Client receives senior management attention on unresolved
issues, the Supplier operates a problem escalation procedure in order that any
unresolved problems are notified to the Suppliers operational and management
personnel on a priority basis dependent upon the severity of the problem. There
are five levels of Problem Priorities and three levels of escalation. This
escalation process is specified in Schedule I to this Agreement.
5.
COMPENSATION
The professional fees
payable for performing either the Standard Services or the Non-standard
Services are to be in accordance with the basis as defined in Schedule J to
this Agreement.
5.2 Reimbursable expenses
Reimbursable expenses
mean agreed incidental services reasonably incurred by the Supplier in
performing its obligations, plus a 10% administrative fee. Expenses that may be considered as
reimbursable are stated in Schedule J to this Agreement.
The Supplier will
submit invoices to the client for professional fees and reimbursable expenses
on a monthly basis in arrears. Each invoice will clearly state the work
performed, hours worked and reimbursable expenses incurred.
All fees and expenses
are to be paid to the Supplier, in the currency of the invoice, by telegraphic
transfer of funds to the account designated by the Supplier. All invoices are payable within 30 days from
the date of the invoice. Any amounts disputed in good faith may be deducted
from the invoice and the remainder must be paid by the due date. The disputed
amount should be notified in writing to the Supplier within 15 days of receipt
of the invoice giving the reasons for withholding payment. Upon receipt of the
Client’s dispute notice, the Supplier and Client will work together in good
faith to resolve such disputes in a prompt and mutually acceptable manner. The
Client agrees to pay any disputed amounts within 5 days once the issues have
been resolved.
The Client agrees to
pay directly or reimburse the Supplier for any taxes arising directly out of
this Agreement excluding any taxes on the Suppliers income.
If the invoice is not
settled within 30 days from receipt of invoice, the Supplier may add an
interest and administrative charge of 1.5% of the invoice amount per month.
6.
CUSTOMER
DUTIES AND RESPONSIBILITIES
6.1 Processing and authorisation of invoices
The Client undertakes
to process and settle invoices by the due dates.
6.2 Client personnel, facilities and
resources
The Client
will ensure the Supplier has timely access to appropriate Client personnel and
will arrange for the Supplier personnel to have suitable and safe access to the
Client’s facilities and systems. The Client will also provide suitable office
space and associated resources for Supplier personnel working on-site including
all necessary computing and office support resources.
6.3 Training on specialised equipment or
tasks
The Client will ensure
that all Client personnel who work on the Supplier’s systems or equipment are
adequately qualified and receive suitable training both to ensure the safety of
the Client’s personnel and to safeguard the Suppliers systems or equipment.
6.4 Approvals and Information
The Client will respond
promptly, and in any case, within five working days, to any Supplier requests
to provide direction, information, approvals, authorisations or decisions that
are reasonably necessary for the Supplier to perform the services.
7.
WARRANTIES
AND REMEDIES
The Supplier warrants
that the Services will be performed in a professional and workmanlike manner
consistent with industry standards reasonably applicable to such services. If
the Client considers that a breach of this warranty has occurred and notifies
the Supplier in writing stating the nature of the breach, then the Supplier
will be required to urgently correct any affected services in order that they
comply with the warranty.
7.2 Indemnification
If, as a result of the
Supplier’s negligence, the Client or Client’s employees suffer injury or
property damage, the Supplier will reimburse the Client for that portion of any
damages for which the Supplier is found to be liable.
7.3 Third party claims
The
Supplier warrants that any works of authorship written by the Supplier’s
personnel will not infringe any third party copyrights, patents or trade
secrets. If a third party takes action against the Client for any infringements
of this nature, then the Supplier will, at its own expense, settle the claim or
arrange to defend the Client in such proceedings, and, in such circumstances,
the Supplier will pay all settlement costs, damages, and legal fees and
expenses finally so awarded.
7.4 Exclusions
The Supplier is not
responsible for any infringements to third party copyrights, patents or trade
secrets where the Client has made amendments to original documents and similar
works prepared by the Supplier without the express approval of the Supplier, or
where the Client fails to use the most recent versions of such works that have
been delivered by the Supplier.
7.5 Remedies for breaches
In the event of any defective performance from the Supplier or failure
to furnish the agreed level of service, the Supplier will make reasonable
efforts to restore the service to a good operating condition on an urgent basis.
If any penalties and refunds are payable in the event of defective service, the
amounts claimable are as defined in Schedule K to this Agreement.
7.6 Force majeure
Except in respect of payment liabilities, neither
party will be liable for any failure or delay in its performance under this
Agreement due to reasons beyond its reasonable control, including acts of war,
acts of God, earthquake, flood, riot, embargo, sabotage, governmental act or
failure of the Internet, provided the delayed party gives the other party
prompt notice of the reasons for such cause.
8.
SECURITY
The
Client is to ensure that the Supplier’s employees and sub-contractors are given
reasonable authorised access to premises and equipment in order that the
Services may be delivered and maintained in accordance with the terms of this
Agreement.
The
Client is to ensure that the Supplier’s employees and sub-contractors are given
necessary access to the software and systems in order that the Services may be
delivered and maintained in accordance with the terms of this Agreement.
In the event that the
Client operates formal security policies, the Supplier will ensure that its
employees are made aware of such policies and will also ensure ongoing
compliance with these policy statements. The Client will provide the Supplier
with up to date information on its security policies and will keep the Supplier
informed about any changes to these policies.
The Supplier will
manage information and data security with reasonable efforts to restrict
unauthorized access. The Supplier will make best endeavours to ensure that its
employees and representatives are fully aware of the risks associated with
information and data security issues.
The Supplier will
ensure that information and data under its responsibility is properly backed up
on a daily basis and also that arrangements are made for recovery processes to
be installed to minimise any potential disruption to the Client’s
business. The Supplier is required to
ensure that proper measures are in place to enable continuation of services in
the event of unexpected disruptive events. These measures should include implementation
and pre-testing of formal disaster recovery and business continuity planning
within the Supplier’s business.
8.6 Encryption
Where requested and
authorised by the Client, the Supplier agrees to utilise Secure Socket Layer
(SSL) encryption technology in the electronic transmission of data to protect
private Client information from access by unauthorized users.
9.
INTELLECTUAL
PROPERTY RIGHTS AND CONFIDENTIAL INFORMATION
Both parties
acknowledge the intellectual property rights of the other party whether
registered or not.
9.2 Confidentiality
Both
parties agree to keep confidential all information concerning the other party’s
business or its ideas, products, customers or services that could be considered
to be “confidential information”. “Confidential information” is any information
belonging to or in the possession or control of a party that is of a
confidential, proprietary or trade secret nature and that is furnished or
disclosed to the other party. Confidential information will remain the property
of the disclosing party and the receiving party will not acquire any rights to
that confidential information.
9.3 Court orders
If the receiving party
receives a Court Order to divulge any confidential information belonging to the
disclosing party, then the receiving party is permitted to release such
information to the court in accordance with any Court Order so served.
9.4 Destruction of data and records or return
on termination
Upon termination of
this Agreement, the receiving party, at the option of the disclosing party,
will return or destroy all confidential information belonging to the other
party.
10.
LEGAL
COMPLIANCE & RESOLUTION OF DISPUTES
The
laws pertaining in the jurisdiction of the Country where the Supplier’s
principal office is located will govern this Agreement.
Both Supplier and
Client agree to comply fully with all relevant export laws and regulation of
the country or countries where their offices are located.
10.3 Informal Resolution
In the event of
dispute, the parties will attempt to resolve any such disputes through informal
negotiation and discussion. Formal proceedings should not be commenced until
such informal negotiations and discussions are concluded without resolution.
Any unresolved dispute
should be referred to a qualified independent arbitrator acceptable to both
parties. The arbitrator will have no authority to award any damages that are
excluded by the terms of this Agreement.
In the event that a suitable independent arbitrator cannot be identified
and agreed on by both parties, then the courts shall be requested to appoint
one.
10.5 Limitation of Action
Neither party may bring
proceedings more than 18 months after the actual event occurred except for
proceedings for non-payment.
Should the Client
become entitled to claim damages from the Supplier, the Supplier will be liable
only for the amount of the Client’s actual direct damage up to the amount that
the Supplier has actually received from the Client as payment for the specific
services or items that are the subject of the claim. The Supplier is not
responsible for any damages caused by the failure of the Client or its
Affiliates or other suppliers to perform their responsibilities. The limitation
of liability included in this section will survive this Agreement.
11.
TERMINATION
This
Agreement commences on the Commencement Date for an initial period of three years. Thereafter, the
Agreement will be automatically renewed annually for successive one-year
periods unless notice is received 180 days before such annual expiry date. The
Supplier will provide to the Client, 180 days written notice of any price
changes due to take effect from each renewal date.
Note: the original SLA was for
the provision of software support where the use of continuing agreements is
normal and relies on you (the purchaser) to terminate the contract in
accordance with the contract terms. It
may be more appropriate to re-word this clause to one that requires an action
to extend.
11.2 Termination
for Convenience
Either party may
terminate this agreement at any time by giving 180
days written notice to the other party.
11.3 Termination
for Cause
If either party fails
to perform its obligations under this Agreement, and does not, within 30 days of receiving written notice describing
such failure, agree to take measures to cure such failure, then this Agreement
may be terminated forthwith.
In the event of
termination of this Agreement for any cause, the Supplier will continue to be
paid up to the effective date of termination for any fees or expenses due for
services delivered up to that date.
12.
GENERAL
Notices required under
this Agreement are to be sent to the address and persons specified in Schedule
L to this Agreement. Notices are to be sent in writing by either registered
post, recorded post, express courier service or be delivered personally.
Each party will act in
good faith in the performance of its respective duties and responsibilities and
will not unreasonably delay or withhold the giving of consent or approval
required for the other party under this Agreement. Each party will provide an acceptable
standard of care in its dealings with the other party and its employees.
Neither party may
assign or otherwise transfer this Agreement without the prior written consent
of the other party. In the event that
consent for assignment is given, the terms of this Agreement will be binding
upon each party’s respective successor.
This document
constitutes the entire agreement between the parties and supersedes all other
prior agreements between the parties for the provision of such services.
The provisions of this
Agreement shall be deemed severable, and the unenforceability of any one of the
provisions shall not affect the enforceability of other provisions. In the
event that a provision is found to be unenforceable, the parties shall
substitute that provision with an enforceable provision that preserves the
original intent and position of the parties.
All changes to this
Agreement must be approved in writing by authorised officials of both parties
and follow the formal change control procedure set out in Schedule M to this
Agreement.
During the term of this
Agreement and for two years after its expiration or termination, neither party
will solicit any employee of the other party for the purposes of offering
employment.
The Schedules referred
to in, and attached to, this document are to be considered an integral part of
this Agreement.
SIGNATURES
The following authorised representatives of each party execute this
Agreement at the Commencement Date:
For the Supplier
Signature
|
Position
|
||
Name
|
Date of Signing
|
For the Client
Signature
|
Position
|
||
Name
|
Date of Signing
|
Schedule A provides a detailed list of the Standard Services that
are to be delivered to the Client under the terms of this Agreement.
NEW PAGE
Schedule B provides a detailed list of the Non-standard or
customised Services that are to be delivered to the Client under the terms of
this Agreement.
NEW PAGE
Schedule C provides a detailed list of the times and periods when
the Standard and Non-standard Services will be available to the Client under
the terms of this Agreement.
NEW PAGE
Schedule D provides the location or locations where the Standard and
Non-standard Services will be delivered to the Client under the terms of this
Agreement.
NEW PAGE
Schedule E provides information on the change control procedures to
be followed when it is necessary to consider changes to Standard or
Non-standard Services
NEW PAGE
Schedule F provides a detailed information on the monitoring of
Standard and Non-standard Services delivered to the Client and the metrics and
other means to be applied to each Service component to measure the performance
of the Services delivered under the terms of this Agreement.
NEW PAGE
Schedule G provides information on the Service level reports
required under the terms of this Agreement.
NEW PAGE
Schedule H provides information on the Service desk services and on
the On-site and Off-site Support services available to the Client under the
terms of this Agreement.
NEW PAGE
Schedule I provides information of the Problem Escalation procedure
to be applied to Standard and Non-standard Services deliverable under the terms
of this Agreement.
NEW PAGE
Schedule J provides information on the fee structure and
reimbursable expenses to be charges by the Supplier in respect of Standard and
Non-standard Services deliverable under the terms of this Agreement.
NEW PAGE
Schedule K provides information on any Penalties and Refunds payable
in respect of defective service levels on Standard and Non-standard Services
deliverable under the terms of this Agreement.
NEW PAGE
Schedule L provides address information and contact details for the
serving of formal notices in writing to either the Supplier or the Client under
the terms of this Agreement.
NEW PAGE
Schedule M provides information on the change control procedures to
be followed for when it is necessary to consider changes this Agreement.
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