v6.0 final september 11 2006 (gta-16-03-00001v6.0)

7/31/2019 v6.0 final September 11 2006 (GTA-16-03-00001V6.0)

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GREATER TORONTO AREA FARE SYSTEM

OPERATING AGREEMENT


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TABLE OF CONTENTS

ARTICLE 1 ............................................................................................................................................................ 8DEFINITIONS AND INTERPRETATION .............................................................................................................. 8

1.1 Definitions .................................................................................................................................. 81.2 Herein, etc................................................................................................................................. 131.3 Currency ................................................................................................................................... 141.4 Statutes..................................................................................................................................... 141.5 Number .....................................................................................................................................141.6 Divisions, Headings and Table of Contents.......................................................................... 141.7 Governing Law......................................................................................................................... 141.8 Severability............................................................................................................................... 141.9 Accounting and Auditing Standards ..................................................................................... 141.10 Entire Agreement..................................................................................................................... 15

ARTICLE 2 .......................................................................................................................................................... 16TERM................................................................................................................................................................... 16

2.1 Term .......................................................................................................................................... 162.2 Renewal ....................................................................................................................................16

ARTICLE 3 .......................................................................................................................................................... 16CHANGES IN MINISTRYS PARTICIPATION & SUCCESSOR(S) ................................................................... 16

3.1 Appointment of Agent, etc......................................................................................................163.2 Appointment of Successor ..................................................................................................... 173.3 Successor(s) Termination.......................................................................................................17

ARTICLE 4 .......................................................................................................................................................... 18SERVICE PROVIDER PRECONDITIONS .......................................................................................................... 18

4.1 Representations and Warranties of Service Provider ......................................................... 184.2 Addition of Service Providers to this Agreement ................................................................194.3 Co-operation with Agent ......................................................................................................... 194.4 Contract between Service Providers and Vendor ................................................................ 194.5 Operation of the GTA Fare System........................................................................................ 204.6 Commitments and Payment of Moneys ................................................................................20

ARTICLE 5 .......................................................................................................................................................... 20SERVICE PROVIDERS....................................................................................................................................... 20

5.1 General Responsibilities .........................................................................................................205.2 Responsibilities To the Vendor.............................................................................................. 215.3 Responsibilities to the Ministry .............................................................................................225.4 Responsibilities to Customers............................................................................................... 225.5 Responsibilities to Other Service Providers......................................................................... 22

ARTICLE 6 .......................................................................................................................................................... 23THE MINISTRY ...................................................................................................................................................23

6.1 General Responsibilities .........................................................................................................236.2 Financial Responsibilities....................................................................................................... 246.3 Responsibility to the Vendor.................................................................................................. 246.4 Responsibility to the Service Providers................................................................................ 246.5 Responsibility to the Transit Customer ................................................................................25

ARTICLE 7 .......................................................................................................................................................... 25RELATIONSHIP BETWEEN THE PARTIES ...................................................................................................... 25

7.1 Residual Decisions.................................................................................................................. 257.2 No Partnership, Joint Venture or Corporation...................................................................... 26

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7.3 Members of Council, Officers, Agents, etc........................................................................ 267.4 No Fiduciary Duties ................................................................................................................. 26

ARTICLE 8 STEERING COMMITTEE ............................................................................................................... 268.1 Establishment of Steering Committee................................................................................... 268.2 Appointment of Steering Committee Members .................................................................... 268.3 Chair of Steering Committee .................................................................................................. 278.4 Vice Chair .................................................................................................................................278.5 Meetings ...................................................................................................................................278.6 Quorum..................................................................................................................................... 288.7 Voting........................................................................................................................................ 288.8 Policy Decisions ......................................................................................................................28

ARTICLE 9 .......................................................................................................................................................... 29EXECUTIVE COMMITTEE.................................................................................................................................. 29

9.1 Establishment of Executive Committee ................................................................................ 299.2 Appointment of Executive Committee Members.................................................................. 299.3 Chair of Executive Committee................................................................................................ 309.4 Vice Chair .................................................................................................................................309.5 Meetings ...................................................................................................................................319.6 Quorum..................................................................................................................................... 319.7 Voting........................................................................................................................................ 319.8 Executive Decisions ................................................................................................................ 31

ARTICLE 10 ........................................................................................................................................................ 33VENDOR.............................................................................................................................................................. 33

10.1 Ministrys Contract with Vendor ............................................................................................3310.2 Disputes with Vendor .............................................................................................................. 3410.3 Service Providers and Agents Responsibilities in Dispute with Vendor......................... 3410.4 Dispute Costs........................................................................................................................... 34

ARTICLE 11 ........................................................................................................................................................ 34DATA RIGHTS .................................................................................................................................................... 34ARTICLE 12 ........................................................................................................................................................ 34CONFLICT OF INTEREST.................................................................................................................................. 34

12.1 Conflict of Interest ................................................................................................................... 34ARTICLE 13 ........................................................................................................................................................ 35FUNDING............................................................................................................................................................. 35

13.1 Ministry Funding Contribution ............................................................................................... 3513.2 Service Provider Funding Contribution ................................................................................3513.3 Funding Responsibilities for GTAFS Enhancements .......................................................... 3613.4 Default in Payment by Service Provider................................................................................ 3613.5 Insufficient Funds provided by the Legislature or Municipal Council............................... 36

ARTICLE 14 ........................................................................................................................................................ 37ASSETS............................................................................................................................................................... 37

14.1 Intellectual Property Rights ....................................................................................................3714.2 Service Provider Assets.......................................................................................................... 3714.3 Ministry Assets ........................................................................................................................ 37

ARTICLE 15 ........................................................................................................................................................ 38COMMUNICATION PLAN................................................................................................................................... 38

15.1 Communication Plan ............................................................................................................... 38

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ARTICLE 16 ........................................................................................................................................................ 38CONFIDENTIAL INFORMATION........................................................................................................................ 38

16.1 Confidential Information ......................................................................................................... 3816.2 Disclosure of Confidential Information to Vendor ............................................................... 3916.3 Injunctive and Other Relief .....................................................................................................3916.4 Notice and Protective Order ................................................................................................... 3916.5 Partys Advisors, Agents, Personnel and Contractors........................................................ 39

ARTICLE 17 ........................................................................................................................................................ 40RECORDS AND AUDITS.................................................................................................................................... 40

17.1 Annual Audit............................................................................................................................. 4017.2 Maintenance of Records by Vendor ...................................................................................... 4017.3 Period for Keeping Records ................................................................................................... 4017.4 Spot Audits............................................................................................................................... 41

ARTICLE 18 ........................................................................................................................................................ 41INTENTIONALLY BLANK ..................................................................................................................................41ARTICLE 19 ........................................................................................................................................................ 42DISPUTE RESOLUTION..................................................................................................................................... 42

19.1 Legal Remedies for Disputes ................................................................................................. 4219.2 Three-tiered Dispute Resolution ............................................................................................ 4219.3 High-Level Negotiation............................................................................................................ 4219.4 Mediation .................................................................................................................................. 4219.5 Arbitration................................................................................................................................. 4319.6 Performance to Continue........................................................................................................43

ARTICLE 20 ........................................................................................................................................................ 43DEFAULT, ENFORCEMENT AND TERMINATION ........................................................................................... 43

20.1 Event of Default .......................................................................................................................4320.2 Ministry Remedies for Event of Default by Service Provider.............................................. 4420.3 Termination for Event of Default by Ministry........................................................................ 4520.4 Termination without cause by the Ministry........................................................................... 4620.5 Termination without cause by a Service Provider ............................................................... 4620.6 Obligations Survive ................................................................................................................. 47

ARTICLE 21 ........................................................................................................................................................ 47LIABILITY............................................................................................................................................................ 47

21.1 Liability .....................................................................................................................................47ARTICLE 22 ........................................................................................................................................................ 48NOTICE ............................................................................................................................................................... 48

22.1 Address for Notices................................................................................................................. 4822.2 Effective Date ........................................................................................................................... 48

ARTICLE 23 ........................................................................................................................................................ 49GENERAL ........................................................................................................................................................... 49

23.1 No Waiver ................................................................................................................................. 4923.2 Force Majeure ..........................................................................................................................4923.3 Remedies Cumulative .............................................................................................................5023.4 Survival ..................................................................................................................................... 5023.5 Amendment .............................................................................................................................. 5023.6 No Assignment ........................................................................................................................ 5023.7 Further Action .......................................................................................................................... 5123.8 Enurement ................................................................................................................................ 51

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23.9 Time of the Essence ................................................................................................................ 5123.10 Counterparts ............................................................................................................................ 5123.11 Gas Tax..................................................................................................................................... 51

SCHEDULE A DESCRIPTION OF GTA FARE SYSTEM AND RELATED COMPONENTS FOR THEOPERATING AGREEMENT ............................................................................................................................... 55SCHEDULE B OPERATING COST COMPONENTS AND FUNDING RESPONSIBILITIES ........................57SCHEDULE "C" SERVICE PROVIDER INFORMATION SHEET...................................................................... 58SCHEDULE "D" SAMPLE COUNCIL/BOARD/COMMISSION BY-LAW/RESOLUTION ................................. 60SCHEDULE E CONFIDENTIALITY REQUIREMENTS ................................................................................. 61SCHEDULE F DATA RIGHTS ........................................................................................................................63SCHEDULE G COMMUNICATION REQUIREMENTS ................................................................................... 65ATTACHMENT -1A TO SCHEDULE G - ONTARIO VISUAL IDENTITY GUIDELINES ............................ 69SCHEDULE H MEDIATION............................................................................................................................. 70SCHEDULE I ARBITRATION.......................................................................................................................... 74

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GTA FARE SYSTEM OPERATING AGREEMENT

THIS AGREEMENT made as of the _____ day of ____________, 2006.

B E T W E E N:

HER MAJESTY THE QUEEN IN RIGHT OF THE PROVINCE OF ONTARIO,represented by the Minister of Transportation for the Province of Ontario

(hereinafter referred to as the Ministry)

- AND -

GREATER TORONTO TRANSIT AUTHORITY,represented by the Managing Director and

Chief Executive Officer, and Secretary for GO Transit

(hereinafter referred to as GO Transit)

- AND -

THE HAMILTON STREET RAILWAY COMPANY,represented by the Mayor and Clerk

(hereinafter referred to as HSR)

- AND -

THE REGIONAL MUNICIPALITY OF YORK,represented by the Regional Chair and the Regional Clerk

(hereinafter referred to as York Region)

THE CORPORATION OF THE CITY OF MISSISSAUGA,represented by the Mayor and Clerk

(hereinafter referred to as Mississauga)- AND -

THE CORPORATION OF THE CITY OF BURLINGTON,represented by the Mayor and Clerk

(hereinafter referred to as Burlington)

- AND -

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THE CORPORATION OF THE CITY OF BRAMPTON,represented by the Mayor and Clerk

(hereinafter referred to as Brampton)

- AND -

THE CORPORATION OF THE TOWN OF OAKVILLE,represented by the Mayor and Clerk

(hereinafter referred to as Oakville)

- AND -

THE REGIONAL MUNICIPALITY OF DURHAMrepresented by the Regional Chair and Clerk

(hereinafter referred to as Durham)

WHEREAS it is in the public interest to encourage the use of public transit systemswithin and across the GTA (Greater Toronto Area or GTA has the meaning given to itin Article 1 (Definitions));

WHEREAS the Parties (Parties has the meaning given to it in Article 1 (Definitions))have entered into the Procurement Governance Agreement for a GTA Fare System

(GTA Fare System has the meaning given to it in Article 1 (Definitions)) among thevarious transit systems in the GTA to encourage transit travel, reducing congestion andassociated environmental impacts;

WHEREAS the Parties desire to set forth in this Agreement a longer term governancestructure/context that establishes the mechanisms for the Parties to work together atvarious levels;

WHEREAS the Parties need to enter into an agreement to address operatingrequirements prior to the Ministry, acting on its own behalf and as Agent, entering intothe Contract with the Vendor;

WHEREAS this Agreement sets forth the roles and responsibilities of the Parties;

WHEREAS the Parties desire to reaffirm their commitment to work together fairly andresponsibly;

AND WHEREAS the Parties recognize each other as equal participants to thisAgreement and wish to proceed with the GTA Fare System on this basis;

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NOW THEREFORE in consideration of the mutual covenants and agreements hereincontained and other good and valuable consideration (the receipt and sufficiency ofwhich are hereby acknowledged), the Parties covenant and agree as follows:

ARTICLE 1DEFINITIONS AND INTERPRETATION

1.1 Definitions

In this Agreement,

Agent means the Ministry, acting as agent for the Service Providers, or any

Successor (Successor has the meaning given to it in this Section 1.1 (Definitions))agent(s) appointed under Section 3.2 (Successor(s));

Agreement means this agreement, including its Schedules (Schedules has themeaning given to it in this Section 1.1 (Definitions)) and Attachments (Attachmentshas the meaning given to it in this Section 1.1 (Definitions)) to its Schedules, as may beamended from time to time;

Alternate Executive Committee Member means an alternate member to anExecutive Committee Member (Executive Committee Member has the meaning givento it in this Section 1.1 (Definitions)) designated by a Party, as set out in Section 9.2

(Appointment of Executive Committee Members);

Alternate Steering Committee Member means an alternate member to a SteeringCommittee Member (Steering Committee Member has the meaning given to it in thisSection 1.1 (Definitions)) designated by a Party as set out in Section 8.2 (Appointmentof Steering Committee Members);

Arbitration Act, 1991 means theArbitration Act, 1991, S.O. 1991, c. 17;

Attachments means the attachments listed in Section 1.10 (Entire agreement) andattached to some of the Schedules to this Agreement;

Broader Public Sector means public bodies in the Province of Ontario, other thanagencies, boards, commissions and Crown corporations, receiving funding from theCrown or a municipality, or both or as determined by the Ministry, acting reasonably, atany time and from time to time;

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Budget means the budget recommended by the Steering Committee under Section8.8 (Policy Decisions), and approved by the Executive Committee under Section 9.8(Executive Decisions);

Business Day means any day which is not a Saturday or Sunday or a day observed

as a holiday under the laws of the Province of Ontario or the federal laws applicable tothe Province of Ontario, or a day observed as a holiday for the Government of Ontario;

Central System means the central system described in Schedule A (Description ofGTA Fare System and related components) and Schedule B (Cost components andfunding responsibilities);

Communication Plan means the communication plan developed by the Ministry andapproved by the Executive Committee;

Communication Requirements means the communication requirements, as set out

in Schedule G (Communication requirements), that must be included in theCommunication Plan;

Confidential Information means (i) any cost estimate(s) showing the unit cost(s) for acomponent or components of the GTA Fare System or sums of cost estimates that canreasonably be manipulated to arrive at the unit cost(s) for a component or componentsof the GTA Fare System; (ii) any information from vendors or other third parties in thepossession of the Ministry relating to the GTA Fare System including, without limitation,pricing, whether provided in response to a Project solicitation document or not; (iii) anypersonal information as contemplated in the Freedom of Information and Protection ofPrivacy Act (Ontario) and the Municipal Freedom of Information and Protection ofPrivacy Act; (iv) any other information specifically designated in writing by a Party asbeing of a confidential nature; and/or (v) any improvements, modifications andenhancements of, and information and things derived from or utilizing, any ConfidentialInformation referred to in clause (i), (iii), (iv), or (v) above;

Contract means the contract or contracts to be entered into between the Ministry,acting on its own behalf and as Agent, and the Vendor to deliver the GTA Fare System,or any part thereof and includes the Master Supply and Services Agreement (MSSA),related schedules, modules and appendices, the GTAFS Technical Specifications, theRequest for Proposal (RFP) and Vendor proposal;

Contractor means, in the case of each Party (Party has the meaning given to it inthis Section 1.1 (Definitions)), any contractor, subcontractor, or consultant of that Party;

Dispute means a dispute as described in Section 19.1 (Legal remedies for disputes);

Dispute Notice means a dispute notice as described in Section 19.2 (Three-tiereddispute resolution);

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Effective Date means the date this Agreement is made as set out on the first page ofthis Agreement;

Eligible Service Provider means a municipality, as defined under the Municipal Act,2001, or a transit authority, including GO Transit or other persons or classes of persons

as may be authorized under the Municipal Act, 2001, with which a municipality ispermitted to enter into an agreement for the Operation of the GTAFS as provided in thisAgreement;

Enhancement means the addition of a service or function by a Party or Parties aftersystem acceptance of the GTAFS by that Party or those Parties;

Event of Default means an event of default as described in Section 20.1 (Event ofdefault);

Executive Committee Member means a member designated by a Party as set out in

Section 9.2 (Appointment of Executive Committee Members);

Executive Decisions means an Executive Committee decision as contemplated inSection 9.8 (Executive Decisions);

Financial Administration Act or FAA means the Financial Administration Act,R.S.O. 1990, c. F.12;

FIPPA means the Freedom of Information and Protection of Privacy Act, R.S.O 1990,c. F. 31;

French Language Services Act means the French Language Services Act, R.S.O.1990, c. F.32;

Gas Tax means funds provided by the Ministry strictly toward eligible expendituresspecifically for the provision of public transportation services;

GO Transit Act, 2001 means the GO Transit Act, 2001, S.O. 2001, c. 23, Sched. A;

GO Transit System means the GO Transit system described in Schedule A(Description of GTA Fare System and related components);

Governing Documentation means this Agreement, the Contract, the ProcurementGovernance Agreement and the Technical Specifications;

Greater Toronto Area or GTA means the geographic area encompassing the Citiesof Toronto and Hamilton, respectively, and the Regional Municipalities of Durham,Halton, Peel and York, respectively;

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Greater Toronto Transit Authority or GO Transit means the Greater TorontoTransit Authority, as continued pursuant to the GO Transit Act, 2001;

GTA Fare System or GTAFS means the goods and services, including the CentralSystem, GO Transit System, and Municipal Systems which Operation is procured by the

Ministry, acting on its own behalf and as Agent, as described in Schedule A(Description of GTA Fare System and related components), for use by the Parties tothis Agreement;

GTAFS Transit Application means the Transit Application as contained in Section 2;Part 9 Business Rules of GTA Technical Specifications; November 15, 2005;

Intellectual Property Rights means any right in respect of any patent, copyright,trade-mark, trade name, trade secret and Moral Rights (Moral Rights has the meaninggiven to it in this Section 1.1 (Definitions)) of any person relating to the GTA FareSystem;

Launch 3 Completion means acceptance of the GTAFS for Brampton, HamiltonDurham by the Ministry on behalf of the Service Providers to the Vendor and full rolloutof GO Transit System;

Ministry means Her Majesty the Queen in Right of the Province of Ontario, asrepresented by the Minister of Transportation for the Province of Ontario;

Moral Rights has the same meaning as in the Copyright Act, R.S.C. 1985, c. C-42,and includes comparable rights in applicable jurisdictions;

Municipality orMunicipalitiesmeans a municipality or municipalities, as the casemay be, that is a Party or are Parties to this Agreement either by having signed this

Agreement or a counterpart to this Agreement. Despite the above and except in Section23.11 (b) (Gas Tax), Municipality or Municipalities include the HSR;

Municipal Act, 2001 means the Municipal Act, 2001, S.O. 2001, c. 25;

MFIPPA means Municipal Freedom of Information and Protection of Privacy ActR.S.O. 1990, c. M.56;

Municipal Systems means the municipal systems described in Schedule A(Description of GTA Fare System and related components) and procured within theProcurement Governance Agreement. For greater clarity, Municipal System includesthe HSR system;

Operating Costs means the operating costs described in Schedule B (OperatingCost Components and funding responsibilities);

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Operating Agreement Executive Committee or Executive Committee means thecommittee established under Article 9 (Executive Committee);

Operating Agreement Steering Committee or Steering Committee means thecommittee established under Article 8 (Steering Committee);

Operation means the operation of the GTA Fare System in accordance with thisAgreement, including the operation of related hardware, software, integration services,maintenance, and all other goods and services that may be used, whether by lease,licence, purchase or otherwise as part of the operation;

Part 9 Business Rules means the approved set of rules and policies that govern theoperation of the GTA Fare System as contained in the Technical Specification version4.1, issued November 14, 2005 and as may be updated by Executive Committee;

Party means any one of the Ministry, in its personal capacity, the Agent and each

Service Provider, and Parties means more than one Party;

Personnel means collectively, in the case of each Party, individuals who provideservices to such Party or any of its Contractors in connection with this Agreement,whether as employees or independent contractors;

Policy Decision means a Steering Committee decision as contemplated in Section8.8 (Policy Decisions);

Procurement Governance Agreement means the agreement made as of June 9,2005 that specifies the roles and responsibilities of the Parties upon which theprocurement is to be carried out and appoints the Ministry as Agent for the ServiceProviders;

Projectmeans the GTA Fare System Project;

"Project Blueprint" means ascribed thereto in Sections 3.1 and 4.1 of the MasterSupply and Services Agreement;

Project Director means the project director appointed under Paragraph 9.8(c)(i)(Executive Decisions);

Project Office means the office located at the GTA Fare System Project Office, c/oGO Transit, Suite 600, 20 Bay Street, Toronto, M5J 2W3, or any other office supplied bythe Agent;

Provincemeans the Crown in Right of Ontario and any or all departments, ministries,agencies, boards, commissions, corporations or other entities thereof;

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Residual Decision means a decision as contemplated in Section 7.1 (ResidualDecisions);

Schedules means the schedules to this Agreement listed in Section 1.10 (Entireagreement) and attached to this Agreement;

Service Level Agreement orSLAmeans the agreement developed by the partiesduring Project Blueprint stage that will bind the parties to particular obligations andrights;

Service Provider or Service Providers means a Municipality or Municipalities, asthe case may be, or the HSR, or GO Transit, or any combination of them;

Steering Committee Member means a member designated by a Party as set out inSection 8.2 (Appointment of Steering Committee Members);

Successor means:

a) any ministry, agency, board, commission or Crown corporation of thegovernment of Ontario; or

b) any entity of the Broader Public Sector;

Surplus Funds means those funds held in the Central System that are in excess offunds from deposits from fare cards less funds needed for day-to-day settlement andincludes funds that are from inactive fare cards;

Technical Specificationsmeans the GTA Fare System Technical Specifications,Parts 1-12, attached as Appendix G to the Request for Proposal for the GTA FareSystem issued Oct 7, 2005;

Term means the term as described in Article 2 (Term);

Third Party Agencymeans an individual, partnership or corporation who has enteredinto a contract to provide a location or locations where fare cards can be sold or valueloaded onto the fare card;

Vendor means the vendor or vendors with which the Ministry, acting on its own behalfand as Agent, will be contracting to deliver and operate the GTA Fare System or partthereof pursuant to the Contract.

1.2 Herein, etc.

The words herein, hereof and hereunder and other words of similar import shallrefer to this Agreement as a whole and not to any particular schedule, article, section,sub-section, paragraph or other subdivision of this Agreement.

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1.3 Currency

Any reference to currency is to Canadian currency and any amount advanced, paid orcalculated is to be advanced, paid or calculated in Canadian currency.

1.4 Statutes

Any reference to a statute is to such statute and to the regulations made pursuant tosuch statute, as such statute and regulations may at any time be amended or modified,and to any statute or regulations that may be passed that have the effect ofsupplementing or superseding such statute or regulations.

1.5 Number

Unless otherwise specified, words importing the singular include the plural and vice

versa.

1.6 Divisions, Headings and Table of Contents

The division of this Agreement into articles, sections, subsections, paragraphs andsubparagraphs, clauses and schedules, the insertion of headings and the provision of atable of contents are for convenience of reference only and shall not affect theconstruction or interpretation of this Agreement.

1.7 Governing Law

This Agreement shall be governed by, and be construed and interpreted in accordancewith, the laws of the Province of Ontario and the laws of Canada applicable in theProvince of Ontario.

1.8 Severability

If any provision of this Agreement is determined by a court of competent jurisdiction tobe invalid or unenforceable, in whole or in part, such invalidity or unenforceability shallattach only to such provision, which shall be severed from this Agreement, and theremaining provisions of this Agreement shall continue in full force and effect. Providedthat the context allows, the remaining provisions shall be interpreted in the same way asthey would have been had the severance not taken place.

1.9 Accounting and Auditing Standards

All accounting and financial terms used in this Agreement shall, except where otherwisespecifically provided in this Agreement, be interpreted and applied in accordance withgenerally accepted accounting principles and generally accepted auditing standards inCanada as they exist from time to time.

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1.10 Entire Agreement

a) Subject to Section 23.3 (Remedies cumulative), this Agreement shall constitutethe entire Agreement and understanding between the Parties relating to the

matters dealt with and supersedes all prior understandings, discussions,negotiations, commitments, representations, warranties and agreements, writtenor oral, express or implied, existing between the Parties at the date of executionwith respect to the subject of this Agreement. None of the Parties shall be boundby any definition, condition, warranty or representation other than as expresslystated in this Agreement or as mandated by federal or provincial law.

b) The following Schedules and Attachments are attached to and form a part of thisAgreement:

i) Schedule A Description of the GTA Fare System and Related

Components of the Operating Agreement;ii) Schedule B Operating Cost Components and FundingResponsibilities;

iii) Schedule C Service Provider Information Sheet;iv) Schedule D Sample Council/Board/Commission By-Law/Resolution;v) Schedule E Service Providers Confidentiality Requirements;vi) Schedule F Data Rights;vii) Schedule G Communication Requirements;viii) Schedule H - Mediation; andix) Schedule I Arbitration.

c) In the event of any conflict between the provisions of the documents mentionedbelow, the following order of precedence shall apply for interpretation purposes:

i) The provisions of the Contract shall take precedence over the otherGoverning Documentation unless otherwise expressly stated in suchother Governing Documentation;

ii) Except for (c) (i), the provisions of this Agreement shall take precedenceover the other Governing Documentation unless otherwise expresslystated in such other Governing Documentation;

iii) The provisions of the Procurement Governance Agreement shall takeprecedence over the Technical Specifications unless otherwiseexpressly stated in the Technical Specifications; and

iv) The provisions of this Agreement (excluding the Schedules) shall takeprecedence over the Schedules to this Agreement unless otherwiseexpressly stated in any such Schedule.

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3.2 Appointment of Successor

The Ministry, acting on its own behalf and as Agent, may at any time, subject to thenotice required under Article 3 (Change in Ministrys participation & successor(s)), andas determined by the Ministry in its sole discretion, assign, in whole or in part, its rights

and obligations under this Agreement to any Successor(s) with the financial andtechnical capability to take on these rights and obligations. When the Successor(s)accept(s) the assignment from the Ministry, this Agreement shall be assigned, in wholeor in part, to the Successor(s) who shall succeed to and become vested with any of therights, powers, responsibilities, obligations and liabilities of the Ministry, acting on itsown behalf and as Agent, that have been assigned to it, and the Ministry, acting on itsown behalf and as Agent, shall be discharged from any such rights, powers,responsibilities, obligations and liabilities under this Agreement. After the appointmentof any Successor(s), this Agreement or, as set out in the assignment, any part of the

Agreement, shall continue in effect for the benefit of the Successor(s) and the ServiceProviders in respect of any actions taken or omitted to be taken by the Ministry, acting

on its own behalf and as Agent.

3.3 Successor(s) Termination

Where the Ministry has not appointed a Successor under Article 3 (Change in Ministrysparticipation & successor(s)), the Ministry, acting on its own behalf and as Agent, may, ifbefore the end of Launch 3 Completion and with at least one hundred-twenty (120) daysprior written notice or if after Launch 3 Completion and with three hundred and sixty five(365) days prior written notice to the other Parties, terminate this Agreement withoutcause and wind-up the Project, including terminating the Contract and any otheragreements and arrangements. Despite the Ministry, acting on its own behalf and as

Agent, having terminated this Agreement, the Parties agree that certain rights andobligations (whether contingent or matured, absolute or not) of the Ministry, acting on itsown behalf and as Agent, as set out in Section 23.4 (Survival), existing immediatelybefore the termination shall survive such termination. In addition, subject to Section20.4 (Termination without cause by the Ministry), if the Ministry, acting on its own behalfand as Agent, terminates the Contract after the Contract has been signed by theVendor, the Ministry, acting on its own behalf and as Agent, shall be responsible for theContract close-out costs, as set out in the Contract, incurred as a result of suchtermination, provided that each Party shall take all steps reasonable in thecircumstances to mitigate the impact of the Contract close-out costs.

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ARTICLE 4SERVICE PROVIDER PRECONDITIONS

4.1 Representations and Warranties of Service Provider

a) Each Service Provider covenants, represents and warrants to the Ministry, acting onits own behalf and as Agent, that:

i) it has the requisite legislative authority and any necessary approval toenter into this Agreement and to carry out its terms, and has passed anynecessary by-law or resolution;

ii) it has or will apply for all permits, approvals (including budget approvals),and licenses that are outside the scope of GTAFS procurement which arerequired in order to operate the GTA Fare System;

iii) it has not entered into any agreement or arrangement that would restrictthe ability of the Ministry, acting on its own behalf and as Agent, toperform its obligations under this Agreement;

iv) subject to Section 20.5 (Termination without cause by a ServiceProvider), it will provide or arrange for funds to be provided as requiredunder this Agreement; and

v) it has adopted a statement of its procurement policies and goals inaccordance with any applicable legislation and such policies and goals

permit the Service Provider, as applicable, to participate in the Operationas authorized under such legislation, including the Municipal Act, 2001.

b) The Service Provider shall be deemed to have repeated the representations andwarranties each time it provides instructions for GTAFS Operations. The Ministry,acting on its own behalf and as Agent, shall have no obligation to make any inquiryto confirm the truth or accuracy of any representation or warranty. The Ministry,acting on its own behalf and as Agent, shall not be liable for any loss or damagessuffered by any of the Service Providers, the Ministry, or any other person as aresult of any act or inaction of the Ministry, acting on its own behalf or as Agent,based on instructions provided by the Service Provider, including without limitation

the execution of this Agreement by a person purporting to have authority to act onthe Service Providers behalf provided that this section does not relieve the Ministryfrom liability arising from its own negligent acts or omissions or its wilful misconductin the performance of its obligations arising from those instructions.

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4.2 Addition of Service Providers to this Agreement

The Ministry, on its own behalf and as Agent, may, from time to time after the EffectiveDate of this Agreement and with the approval of the Executive Committee, add EligibleService Providers as Parties to this Agreement. Once added as a Party to this

Agreement, and upon providing the following documentation to the Agent, an EligibleService Provider shall become a Service Provider:

a) An information sheet on the Eligible Service Provider (attached as Schedule C(Service Provider information sheet)); and

b) A certificate confirming passage and enforceability of a by-law or resolution, asapplicable which includes, at a minimum, the information in the sample by-law/resolution attached as Schedule D (Council/board/commission by-law/resolution), including the designation of persons authorized to provideinstructions and any necessary approval for the Operation as Steering Committee

Member, Alternate Steering Committee Member, Executive Committee Member, orAlternate Executive Committee Member, and confirming that all necessary actionshave been taken by the Eligible Service Provider to authorize such persons to giveinstructions and any necessary approval for the Operation. The designations shallrefer to positions rather than to specific individuals.

Each Service Provider agrees that this Agreement is binding on it regardless of theaddition of Eligible Service Providers by the Ministry as Parties to this Agreement. Uponbecoming a Service Provider, the Eligible Service Provider shall become a Party to andshall be bound by this Agreement, as of the date of executing a counterpart to this

Agreement, which it shall have delivered to the other Parties, and as if it had been anoriginal Party to this Agreement, without any further action or execution required by anyexisting Service Provider.Each existing Party will become bound to a new Party upondelivery of the counterpart to that Party. Delivery from an existing Party to a new Partyshall take effect upon receipt of a copy of the Agreement from the Agent, as if it were anoriginal copy signed by the Parties, by the new Party.

4.3 Co-operation with Agent

Each Service Provider shall fully co-operate with the Agent, and allow the Agent, inaccordance with the terms and conditions of this Agreement, to act on its behalf inrespect of GTAFS Operations, including matters in furtherance of the GTAFSOperations. Further, each Service Provider shall take all reasonable steps necessary toenable the Agent to carry out its responsibilities in relation to the Contract.

4.4 Contract between Service Providers and Vendor

a) A Service Provider may enter into a contract with the Vendor in relation to the GTAFare System with the express written consent of Ministry, acting on its own behalf

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and as Agent, which consent shall not be unreasonably withheld.

b) A Service Provider must ensure Contract commitments contained in Section 1.3(Exclusivity and Minimum Volumes) of the MSSA for equipment have been metbefore entering a contract with a vendor for equipment with a similar purpose.

4.5 Operation of the GTA Fare System

Each Service Provider shall operate the GTA Fare System as it applies to such ServiceProvider in accordance with the operating policies approved by the ExecutiveCommittee in accordance with Section 5.1 (General responsibilities).

4.6 Commitments and Payment of Moneys

Each Service Provider shall be responsible for the payment of funds set out in Article 13

(Funding). Before a Service Provider provides instructions for the Operation andarranges for the payment of funds towards the Operation, the Service Provider shallensure that it has the authority to provide such instructions and sufficient funds to coverthe amount of such payment.

ARTICLE 5SERVICE PROVIDERS

5.1 General Responsibilities

Each Service Provider shall:

a) Work co-operatively, fairly and responsibly with other Service Providers, theVendor, and Ministry for successful operation of the GTAFS;

b) Ensure that it completes and maintains all necessary steps to commence andcontinue operation in the GTAFS including but not limited to the installation ofequipment and software, training of staff, and communication with its customers;

c) Appoint sufficient staff it deems necessary to meet obligations for its participationin the GTAFS for its operation;

d) To avoid liability for fraud, implement and maintain customer (credit/debit card)payment verification practices as approved by Executive Committee;

e) Provide banking direction to settle accounts with the Central System;

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f) Implement Part 9 Business Rules that exist at that time and that may be modifiedfrom time to time;

g) Take all reasonable steps within its control to ensure that any of its actions doesnot cause the Ministry to commit a default under the terms of the Contract; and

h) Not be entitled to vote on a motion to remove itself as a Party to the Agreementand to the Project.

5.2 Responsibilities To the Vendor

Each Service Provider shall where applicable:

a) Nominate local Third Party Agency network locations;

b) Approve Third Party Agency contract jointly developed and / or modified with

Vendor;

c) Ensure its Third Party Agency network is established and maintained to sell andload value to fare cards either by working with the Vendor or with its ownresources;

d) Use the GTA Fare System in the Service Providers operations including:

i) Operate appropriate Service Provider devices;

ii) Ensure Service Provider devices are functional prior to commencing1perations daily;

iii) Monitor condition and status of devices during operations as required;

iv) Perform preventative and first line maintenance of devices as detailedin the Technical Specifications; and

v) Access reports and other system functionality via Service Providerwebsite on the Central System;

e) Pay the Vendor directly for contracted services related to technical and ThirdParty Agency network support, as laid out in Article 13 (Funding) and in ScheduleB (Operation Cost components and funding responsibilities), including anypenalties due for late payment; and

f) Provide assistance as necessary in any disputes between a customer and theVendor as required under Executive Committee policy.

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5.3 Responsibilities to the Ministry


a) Request and fund Contract changes from the Ministry for service changes,

enhancements, or new or modified transit and municipal applications that theMinistry will procure from the Vendor on behalf of the Service Provider;

b) Transfer funds owed to Central System and pay any due fees;

c) Provide notice to the Ministry of its acceptance of new and modified applications,service changes, equipment, processes and procedures, as requested by theService Provider;

d) Provide notice to the Ministry of its acceptance of its Service Provider system,including systems for Service Providers added under Section 4.2 (Addition of

Service Providers to this Agreement), before commencing Operations;

e) Promptly report Vendor performance deficiency issues to the Ministry; and

f) Provide notice to the Ministry with appropriate details and documentation of anypayment dispute between the Service Provider and the Vendor.

5.4 Responsibilities to Customers


a) Be solely responsible to provide customer related service and information for itsown transit system;

b) Market the GTA fare card within the area of its transits operation using commonmarketing material developed by all of the Parties as part of the marketing plan;and

c) Provide for the sale of fare cards and the ability to load value onto the fare cardseither through its own facilities or Third Party Agency network.

5.5 Responsibilities to Other Service Providers


a) Work toward the harmonization of customer service support levels throughout theGTA including support levels for telephone information services and web basedinformation services; and

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b) Work co-operatively, fairly and responsibly with other Service Providers in allaspects of the GTAFS.

ARTICLE 6

THE MINISTRY

6.1 General Responsibilities

The Ministry shall:

a) Work co-operatively, fairly and responsibly with Service Providers and theVendor, for the successful Operation of the GTAFS;

b) Ensure that it completes and maintains all necessary steps to commence and

continue to operate the Central System;

c) Appoints sufficient staff it deems necessary to meet its obligations in the GTAFSOperation;

d) Terminate, renew or modify the Contract on its own behalf and in accordancewith the direction of the Executive Committee as agent as required;

e) Manage Vendor disputes, including those involving Service Providers asprovided in Article 10 (Vendor);

f) Obtain appropriate and complete licence(s) for Vendors intellectual property,pursuant to the licence rights of the GTA Fare System components as providedin the Contract, required to operate the GTAFS on its own behalf and as Agentfor Service Providers;

g) Manage and maintain all Ministry assets as defined in Article 14 (Assets), of thisAgreement to the extent permitted in the RFP and the Contract;

h) Bring forward for Executive Committee review, any contract for otherapplications, to use the Central System in addition to the GTAFS Transit

Application, before the Ministry enters into the contract;

i) Nominate a Project Director for the approval of the Executive Committee; and

j) Oversee and ensure the operation of the Central System is undertaken in afiscally sound and responsible manner.

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6.2 Financial Responsibilities

The Ministry shall:

a) Be responsible for Ministry costs defined in Article 13 (Funding) and Schedule B(Operating cost components and funding responsibilities);

b) Guarantee Service Providers payments to the Vendor for technical support andThird Party Agency network operations;

c) Settle accounts with funds and fees due from Service Providers and makepayments to Service Providers for payments and fees due;

d) Be accountable for and manage all accounts and investments as part of theGTAFS Operations in accordance with Executive Committee approved policies;

and

e) Monitor Vendors management of fare card customer accounts and takeappropriate action under the Contract where necessary.

6.3 Responsibility to the Vendor

The Ministry shall:

a) Manage the Vendor according to the terms and conditions of the Contract;

b) Implement approved operating changes to the Contract on behalf of the Ministryand Service Providers pursuant to the Contract;

c) Communicate service deviations or deficiencies and other changes between theVendor and any/all Service Providers;

d) Monitor and communicate Vendor compliance with Vendor Service LevelAgreement and take appropriate action under the Contract where necessary; and

e) Monitor that the Vendor maintains approved data protection and securityrequirements pursuant to the Contract and take appropriate action under theContract where necessary.

6.4 Responsibility to the Service Providers

The Ministry shall:

a) On behalf of the Service Provider, certify to the Vendor each Service Providersystem, including systems for Service Providers added under Section 4.2

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7.2 No Partnership, Joint Venture or Corporation

The execution of this Agreement and the other arrangements with respect to theoperations of the GTA Fare System are not intended to create, and shall not be treatedas having created, a general or limited partnership, joint venture, or corporation.

7.3 Members of Council, Officers, Agents, etc

Each Service Provider and its members of commissions, council, officers, agents,Contractors and employees are not, nor are they deemed to be, officers, agents (withthe exception of GO Transit), employees or officials of the Ministry.

7.4 No Fiduciary Duties

The Ministry shall not by reason of this Agreement or any of the discussions leading toor in connection with this Agreement have a fiduciary or trust relationship with theService Providers or any other person, or any other obligation other than as specificallystated in this Agreement.

ARTICLE 8STEERING COMMITTEE

8.1 Establishment of Steering Committee

The Parties agree to establish an Operating Agreement Steering Committee. The role of

the Steering Committee shall be to provide overall management and advice, monitoroperations, and recommend adjustments to ensure the Operation of the GTAFS iscarried out in accordance with this Agreement and the policies approved by theExecutive Committee under Section 9.8 (Executive Decisions), and to provide anynecessary approval in accordance with this Article 8 (Steering Committee).

8.2 Appointment of Steering Committee Members

The Ministry, on its own behalf, and each Service Provider shall appoint one member tothe Steering Committee (the Steering Committee Member). The Ministry, on its ownbehalf, and each Service Provider may also appoint one or more alternates for suchPartys Steering Committee Member (an Alternate Steering Committee Member). An

Alternate Steering Committee Member may attend and act at Steering Committeemeetings in the Steering Committee Members absence, as if such Alternate SteeringCommittee Member was the Steering Committee Member for such Party. Theappointment of the Steering Committee Member and the Alternate Steering CommitteeMember for a Service Provider shall be confirmed by a by-law or resolution of thecouncil of the Municipality or the commission or board (as applicable). The designationshall refer to a position rather than a specific individual.

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8.3 Chair of Steering Committee

a) The Ministry shall appoint the Project Director as chair of the Steering Committeeto serve at the pleasure of the Ministry.

b) The responsibilities of the Steering Committee chair include:

i) Establishing the agenda of each meeting of the Steering Committee;

ii) Distributing the agenda of each meeting of the Steering Committee atleast seven (7) days prior to such meeting;

iii) Recording, distributing and storing the minutes of such meetings; and

iv) Reporting recommendations and discussions of the Steering Committeeto the Executive Committee as required.

8.4 Vice Chair

a) The Steering Committee shall select from among its members a vice chair.

b) The vice chair shall hold office for a one year period from the anniversary ofselection.

c) A member who is acting as vice chair is eligible for re-appointment as long asthey retain their status as a member of the Steering Committee.

d) The vice chair shall act as Steering Committee chair in the absence of theSteering Committee chair, with all of the duties, rights and responsibilities of theSteering Committee chair. In the absence of the Steering Committee chair andthe vice chair, and provided a quorum of the Steering Committee Members ispresent, the Steering Committee Members present shall select an actingSteering Committee chair from amongst themselves, with all of the duties, rightsand responsibilities of the Steering Committee chair, until such time as the chairor vice chair are no longer absent.

8.5 Meetings

a) The Steering Committee shall meet at least quarterly and may meet more often

where the chair requests additional meetings.

b) Unless the Steering Committee decides otherwise, all meetings of the SteeringCommittee shall be held at the Project Office.

c) Any two (2) Steering Committee Members can, by at least ten (10) days priorwritten notice to the chair and to the other Steering Committee Members,

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requisition a special meeting of the Steering Committee. The written notice shallspecify the issue.

8.6 Quorum

A quorum for the transaction of business at any meeting of the Steering Committeeshall consist of at least sixty percent (60%) of the total number of the SteeringCommittee Members of all Parties, except the Agent.

8.7 Voting

The Ministry, on its own behalf, and each Service Provider shall have one vote. Partiesmust be present to vote.

8.8 Policy Decisions

a) All Policy Decisions of the Steering Committee require the approval of at leastsixty percent (60%) of the Steering Committee Members present.

b) Policy Decisions that the Steering Committee has authority to implement arelimited to;

i) Establishment of sub-committees to assist in fulfilling the successfulOperation of the GTAFS, including sub-committees to recommendoperating policies; and

ii) Establishment of rules and procedures regarding its own meetings.

c) Policy Decisions that must be recommended to the Executive Committee mayinclude but are not limited to the following:

i) Budget and any changes to the Budget, including changes resulting froma Budget issue that affects Service Provider budgets;

ii) Policies and methodology for investment of funds, including SurplusFunds, and for distribution of costs and revenues, including investmentrevenues amongst the Parties;

iii) Ministry as Agent entering into Contract modification or renewal;

iv) Subject to agreement of all Parties in the sharing of costs related thereto,the Ministry terminating the Contract with the Vendor;

v) Service Provider requested new or modified transit and municipalapplications for development, implementation and operation;

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vi) Approval of the annual audit report;

vii) Annual work plan and annual report;

viii) Marketing plan and Communication Plan;

ix) Changes to Part 9 Business Rules including fees & commissions;

x) Operating agreements including Service Level Agreements to manage theongoing Operation of the GTAFS;

xi) Operating policies and procedures for the Operation of the GTA FareSystem or changes thereto including;

Data rights and data access;Customer dispute resolution; Privacy policy;Report distribution;

Third Party Agency contracts including credit worthiness;Fare card load value limits; and

xii) Removal of a Service Provider as a Party to this Agreement and aparticipant in the GTAFS.

d) Policy Decisions that have not been resolved by the Steering Committee shall beforwarded to the Executive Committee for resolution;

ARTICLE 9

EXECUTIVE COMMITTEE

9.1 Establishment of Executive Committee

The Parties agree to establish an Operating Agreement Executive Committee. The roleof the Executive Committee shall be to provide overall leadership and direction, monitoroperations, and make adjustments to ensure the Project operates in accordance withoperating policies to be approved by the Executive Committee under Paragraph 9.8 (c)(vii) (Executive Decisions), and to provide any necessary approval in accordance withthis Article 9 (Executive Committee).

9.2 Appointment of Executive Committee Members

The Ministry, acting on its own behalf, and each Service Provider shall appoint onemember to the Executive Committee (the Executive Committee Member). TheMinistry, acting on its own behalf, and each Service Provider may also appoint one ormore alternates for such Partys Executive Committee Member (an Alternate ExecutiveCommittee Member). An Alternate Executive Committee Member may attend and act

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at Executive Committee meetings in the Executive Committee Members absence, as ifsuch Alternate Executive Committee Member was the Executive Committee Member forsuch Party. The appointment of the Executive Committee Member and the AlternateExecutive Committee Member for a Service Provider shall be confirmed by a by-law orresolution of the council of the Municipality or the commission or board (as applicable).

The designation shall refer to a position rather than a specific individual.

9.3 Chair of Executive Committee

a) The Ministry shall appoint the chair of the Executive Committee to serve at thepleasure of the Ministry for a term of one (1) year that may, at the discretion ofthe Ministry, be extended for additional one (1) year term up until the Launch 3Completion.

b) Upon expiry of the Ministry term as chair upon Launch 3 Completion, theExecutive Committee members shall appoint a chair among the members.

c) The responsibilities of the Executive Committee chair include:

i) Establishing the agenda of each meeting of the Executive Committee;

ii) Distributing the agenda of each meeting of the Executive Committee atleast seven (7) days prior to such meeting; and

iii) Recording, distributing and storing the minutes of such meetings.

9.4 Vice Chair

a) The Executive Committee shall select from among its members a vice chair.

b) The vice chair shall hold office for a one year period from the anniversary of selection.

c) A member who is acting as vice chair is eligible for re-appointment as long asthey retain their status as a member of the Executive Committee.

d) The vice chair shall act as Executive Committee chair in the absence of theExecutive Committee chair, with all of the duties, rights and responsibilities of theExecutive Committee chair, including voting. In the absence of the ExecutiveCommittee chair and the vice chair, and provided a quorum of ExecutiveCommittee Members is present, the Executive Committee Members present shallselect an acting Executive Committee chair from amongst themselves, with all ofthe duties, rights and responsibilities of the Executive Committee chairuntil suchtime as the chair or vice chair are no longer absent.

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9.5 Meetings

a) The Executive Committee shall meet at least two (2) times per year, and maymeet more often where the chair requests additional meetings.

b) Unless the Executive Committee decides otherwise, all meetings of theExecutive Committee shall be held at the Ministry of Transportation office atQueens Park.

c) Any two (2) Executive Committee Members can, by at least ten (10) days priorwritten notice to the chair and to the other Executive Committee Members,requisition a special meeting of the Executive Committee. The written notice shallspecify the purpose of the meeting including proposed topics and decision points.

9.6 Quorum

A quorum for the transaction of business at any meeting of the Executive Committee

shall consist of at least sixty percent (60%) of the Executive Committee Members of allParties.

9.7 Voting

The Ministry, on its own behalf, and each Service Provider shall have one vote.Members must be present to vote.

9.8 Executive Decisions

a) The following are Executive Decisions that relate to the performance of the Agentand the Ministry and, despite Section 9.6 (Quorum), require the concurrence ofthe Executive Committee Members representing all the Service Providers(excluding GO Transit):

i) Approval of the Ministry, acting on its own behalf and as Agent, assigning itsrights and obligations under this Agreement in accordance with Section 23.6(No assignment);

ii) The determination of whether an Event of Default on the part of the Ministry,acting on its own behalf or as Agent, or both, has occurred;

iii) The determination of whether an Event of Default on the part of the Ministry,acting on its own behalf or as Agent, or both, is curable or has been cured;and

iv) Approval of the termination of this Agreement in accordance with Section20.3 (Termination for Event of Default by Ministry), taking into consideration

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whetherthe termination date can be resolved so as to minimize the adverseimpact on the GTA Fare System.

b) The following are Executive Decisions that require the concurrence of each of the

Executive Committee Members present:

i) Budget and any changes to the Budget, including a change resulting from aBudget issue that affects Service Provider Budgets;

ii) Policies and methodology for investment of funds, including Surplus Funds,and for distribution of costs and revenues, including investment revenuesamongst the Parties;

iii) Subject to agreement of all Parties in the sharing of costs related thereto, theMinistry terminating the Contract with the Vendor;

iv) Procedures and rules regarding Executive Committee meetings;

v) Changes to Part 9 Business Rules that impact the majority of members,including fees and commissions schedules that affect a majority of themembers;

vi) Service Level Agreement or modification thereof between the Ministry andthe Service Providers; and

vii) Removal of a Service Provider as a Party to the Agreement and participantin the GTAFS.

c) Any other decision is considered a Residual Decision that requires a minimum ofsixty (60) percent approval of the members of the Executive Committee presentat a meeting. Residual items include but are not limited to:

i) Ministry nominee as Project Director;

ii) Annual work plan and annual report;

iii) Annual audit report;

iv) New or modified transit or municipal application for development,implementation and operation;

v) Marketing plan and Communication Plan;

vi) Confirmation including the terms and conditions, of new Service Providersparticipating in GTAFS;

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vii) Operating Policies including;

Data rights and data access;

Customer dispute resolution;Privacy policy;Report distribution;Third Party Agency contracts including credit worthiness; andFare card load value limits;

viii) Operating procedures and agreements to manage the ongoing Operation ofthe GTAFS;

ix) Changes to Part 9 Business Rules that do not impact majority of membersincluding the following fees and commissions:

GO Transit specific feesCard issuance feePhoto feeCard mailing and postage feeOverdraft fee; and

x) Contract renewal or amendment (concurrence of impacted parties).

d) The following matter requires Executive Committee review:

i) The Ministry entering into a contract for other applications to use the CentralSystem in addition to the GTAFS Transit Application.

e) Any failure of the Executive Committee to achieve concurrence on any matterunder this Section 9.8 (Executive Decisions) shall be dealt with in accordancewith Article 19 (Dispute resolution).

ARTICLE 10VENDOR

10.1 Ministrys Contract with Vendor

The Ministry shall enter into a Contract, or agree to any Contract amendment, with theVendor only after it has received the approval or review of the Executive Committee asrequired to enter into such Contract, or amend such Contract.

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10.2 Disputes with Vendor

Disputes between any or all of the Ministry, a Service Provider and the Vendor shall be

resolved in accordance with the Contract, the terms of this Agreement, and anyapplicable law.

10.3 Service Providers and Agents Responsibilities in Dispute with Vendor

a) The Ministry shall be responsible for the handling of all disputes that may arisebetween it and the Vendor under the Contract.

b) Despite the above, each Service Provider shall be responsible for the handling ofall disputes that may arise between the Service Provider and the Vendor inrelation to any direct contract exclusively entered into between the Service

Provider and the Vendor in accordance with Article 4.4 (Contract betweenService Providers and Vendor). The Ministry, if requested by any of the ServiceProviders and without subjecting itself to any costs, including legal costs, orliability, may join in the resolution of complaints with the Vendor.

10.4 Dispute Costs

Unless otherwise provided in the Contract, dispute costs, including the Ministrys whileacting as Agent, such as the Ministrys legal expenses and other costs related to thedispute are to be borne by any Party to which the complaint relates and the Vendor.

ARTICLE 11DATA RIGHTS

11.1 Each Party shall have the rights to data as provided in Schedule F (Data rights).

11.2 Not withstanding Article 11(Data rights), the Executive Committee may amendSchedule F (Data rights) from time to time.

ARTICLE 12CONFLICT OF INTEREST

12.1 Conflict of Interest

Each Party and any of its respective advisors, partners, directors, commissioners,officers, Personnel, agents, or Contractors shall not engage in any activity or provide

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any services where such activity or the provision of such services creates a conflict ofinterest (actually or potentially) with the terms and conditions set out in this Agreement.Each Party acknowledges and agrees that it shall be a conflict of interest for it to useConfidential Information, without specific authorization from the appropriate other Partyto do so.

ARTICLE 13FUNDING

13.1 Ministry Funding Contribution

The Ministry shall be exclusively responsible to provide funds for the following:

a) Vendor Costs as set out in Schedule B (Cost components and funding

responsibilities) and as contained in the Contract for Central SystemOperating Costs including banking fees, call centre, telecommunicationsequipment and staffing;

b) MTO implemented additional applications;

c) Requirements to meet growing Central System volumes;

d) Annual audit;

e) Central support for branding and marketing of GTAFS; and

f) Project Office.

13.2 Service Provider Funding Contribution

Each Service Provider shall be exclusively responsible to provide funds for thefollowing:

a) Promptly paying its own operating costs, including late payment penalties,for Centrally Managed Services, as defined in Schedule B (Operating Costcomponents and funding responsibilities) to the Vendor;

b) Internal costs related to ongoing support to GTAFS Operations;

c) Ongoing marketing of GTAFS within its service area; and

d) All costs for additional applications or enhancements that the ServiceProvider requests from the Ministry acting as Agent within the Contract.

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13.3 Funding Responsibilities for GTAFS Enhancements

a) Each Party shall be exclusively responsible to pay for all costs associatedwith any enhancements to the GTAFS that is intended for its sole benefit.

b) Where two or more Parties request an enhancement to the GTAFS each

shall contribute in agreed amounts to the costs of such enhancement.

c) A Service Provider or the Ministry who has contributed to an enhancementunder Sub-section 13.3 (a) or (b) respectively, shall be entitled to negotiatethe terms and conditions with any other Party that has not contributed tohave access to the enhancement.

d) Pursuant to the Contract the Ministry shall own the intellectual property; ifany, as per Section 14.1 (Intellectual Property Rights) for enhancements tothe benefit of the Party or Parties requesting the enhancement.

13.4 Default in Payment by Service Provider

Each Service Provider agrees that the Ministry, acting on its own behalf and as Agent,shall be responsible for payments to the Vendor under the Contract, either directly orindirectly through a Successor, and that moneys for such payments shall be recoveredby the Ministry, acting on its own behalf and as Agent, either directly or indirectlythrough a Successor, from the Service Providers. If the Ministry, acting on its ownbehalf and as Agent, either directly or indirectly through a Successor requests thatpayment be made by a Service Provider, in accordance with the terms of this

Agreement, to satisfy the terms of the Contract, and the Service Provider provides no orinsufficient funds to pay, when due, for the Operation payments, and if it is found thatthe Service Provider is in default as pursuant to Section 20.1 (Event of Default), then

the Service Provider, with respect to the Operation, shall have no interest in theOperation or income relating thereto or proceeds thereof and Article 20 (Defaultenforcement and termination) shall apply.

13.5 Insufficient Funds provided by the Legislature or Municipal Council

a) By virtue of the Financial Administration Act, the obligations of the Ministry,acting on its own behalf and as Agent, GO Transit, and any Successor, whereapplicable, to make any payment under this Agreement are deemed to besubject to the condition that the payment is authorized by an appropriation for thefiscal year in which the payment comes due or its having been charged to an

appropriation for a prior fiscal year.

b) If, in the opinion of the Ministry, acting on its own behalf and as Agent, theLegislative Assembly of Ontario does not provide the Ministry, GO Transit, or aSuccessor, where applicable, with sufficient funds to continue its participation inthis Agreement for any provincial fiscal year during which this Agreement is ineffect, the Ministry, acting on its own behalf and as Agent, may terminate this

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Agreement in accordance with the terms specified in Section 20.4 (Terminationwithout cause by the Ministry).

c) If the municipal council of the Municipality does not provide the Municipality withsufficient funds to continue its participation in this Agreement for any municipal

fiscal year during which this Agreement is in effect, the Municipalitymayterminate this Agreement in accordance with the terms specified in Section 20.5(Termination without cause by a Service Provider).

ARTICLE 14ASSETS

14.1 Intellectual Property Rights

Intellectual Property Rights to the GTA Fare System components shall be as provided inthe Contract unless otherwise provided in this Agreement.

14.2 Service Provider Assets

a) Each Service Provider shall retain its respective ownership interests in allaspects of its Service Provider system including all related devices, equipment,parts, spares and related networks that it had paid for.Subject to this Agreement,while participating as a Service Provider in relation to the GTA Fare System, noService Provider has the right to distribute any asset acquired through theProcurement as defined in the Procurement Governance Agreement without

Ministry approval.

b) Service Providers may acquire additional assets, under the Contract as part ofthis Agreement upon expiry of the Procurement Governance Agreement.

c) Each Service Provider shall have exclusive ownership of the data related to theirrespective fare transactions.

14.3 Ministry Assets

a) In recognition of the Parties acknowledgement that the GTAFS is not apartnership or joint undertaking, the Ministry has exclusive ownership interest inall elements of the GTAFS that cannot be divided for the benefit of the otherParties including:

i) GTAFS Transit Application and associated rights;

ii) Fare card;

iii) GTA Fare System logo and brand; and

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iv) Central System licenses, equipment and leases as appropriate;

For greater clarity, the Service Providers shall not have any legal or beneficial, orboth, ownership interest in the Central System pursuant to the Contract whichshall be owned by the Ministry or a Successor.

b) Pursuant to Section 14.1 (Intellectual Property Rights), the Ministry shall workwith Service Providers to address the necessary Intellectual Property Rightsneeded by Service Providers for use of the GTA Fare System.

ARTICLE 15COMMUNICATION PLAN

15.1 Communication Plan

a) The Parties agree that public communication with third parties in relation to theGTA Fare System shall be carried out in accordance with the terms andconditions set out in the Communication Plan approved by the ExecutiveCommittee under Paragraph 9.8 (c )(v) (Executive Decisions);

b) The purpose of the Communication Plan is for the Ministry and Service Providersto communicate with the public about the GTA Fare System and to enhanceopportunities for appropriate, continuous and consistent recognition of the co-operative efforts of the Parties. The Communications Plan shall include thecommunications requirements set out in Schedule G (Communication

Requirements); and

c) Public communication covered under the Plan shall include:

i) Public information material related to the GTAFS;ii) Media releases;iii) Media conferences, public announcements and other joint events; andiv) Signage.

ARTICLE 16

CONFIDENTIAL INFORMATION

16.1 Confidential Information

During and following the term of this Agreement, each Party shall keep in accordancewith the terms and conditions set out in Schedule E (Confidentiality requirements),and ensure that its advisors, agents, directors, commissioners, officers, partners,

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Personnel, representatives and Contractors keep all Confidential Informationconfidential in accordance with the terms and conditions set out herein, and which mustbe contained in any applicable confidentiality agreement.

16.2 Disclosure of Confidential Information to Vendor

Each Service Provider acknowledges and accepts that the Ministry has undertakencertain obligations on its own behalf and as Agent, in relation to the disclosure ofConfidential Information with the Vendor pursuant to the Contract. Consequently eachService Provider accepts that it is required to comply with the disclosure of ConfidentialInformation provisions of the Contract subject to any applicable laws.

16.3 Injunctive and Other Relief

Each Party acknowledges that breach of any provisions of this Article 16 (ConfidentialInformation) may cause irreparable harm to the other Parties or to third party to whom

the Party owes a duty of confidence, and that the resulting injury to such Party or to anythird party may be difficult to calculate and adequately compensate in damages. EachParty agrees that any other Party is entitled to obtain injunctive relief (without

v6.0 final september 11 2006 (gta-16-03-00001v6.0)

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