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VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
kokoa
Dated 11th June 2014
(1) THE SECRETARY OF STATE FOR TRANSPORT
(2) GOVIA THAMESLINK RAILWAY LIMITED
TSGN FRANCHISE AGREEMENT
RAIL PUBLIC REGISTER COPY
REDACTED IN ACCORDANCE WITH FOIA 2000
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
2
CONTENTS
Clause Page
1 INTERPRETATION ........................................................................... 8
2 DEFINITIONS ............................................................................... 12
3 COMMENCEMENT ........................................................................ 123
4 TERM ........................................................................................ 124
5 GENERAL OBLIGATIONS .............................................................. 124
6 COMPLIANCE WITH LAWS ............................................................ 125
7 ENTIRE AGREEMENT ................................................................... 125
8 GOVERNING LAW ....................................................................... 126
Schedules
1 Passenger Service Obligations ...................................................... 128
SCHEDULE 1.1 ........................................................................... 129
Service Development .................................................................. 129
SCHEDULE 1.2 ........................................................................... 143
Operating Obligations .................................................................. 143
SCHEDULE 1.3 ........................................................................... 150
Not Used ................................................................................... 150
SCHEDULE 1.4 ........................................................................... 151
Passenger Facing Obligations ....................................................... 151
SCHEDULE 1.5 ........................................................................... 159
Information about Passengers ...................................................... 159
SCHEDULE 1.6 ........................................................................... 165
Franchise Services ...................................................................... 165
SCHEDULE 1.7 ........................................................................... 170
The Train Fleet ........................................................................... 170
APPENDIX TO SCHEDULE 1.7 ....................................................... 174
PART 1 TO APPENDIX .................................................................. 174
PART 2 TO APPENDIX .................................................................. 175
PART 3 TO APPENDIX .................................................................. 176
PART 4 TO APPENDIX .................................................................. 177
2 Assets, Leases, Third Parties, Other Franchise Operations and Schemes ................................................................................... 178
SCHEDULE 2.1 ........................................................................... 179
Asset Vesting and Transfer .......................................................... 179
SCHEDULE 2.2 ........................................................................... 181
Security of Access Agreements, Rolling Stock Leases, Station and Depot
Leases ....................................................................................... 181
SCHEDULE 2.3 ........................................................................... 189
Third Party Delivery of Passenger Services and Other Franchisees .... 189
SCHEDULE 2.4 ........................................................................... 191
Other Franchise Operations .......................................................... 191
SCHEDULE 2.5 ........................................................................... 195
Transport, Travel and Other Schemes ........................................... 195
3 Not Used ................................................................................... 197
4 Persons with Disabilities and Disability Discrimination ..................... 198
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
3
APPENDIX 1 TO SCHEDULE 4 ....................................................... 205
Minor Works ............................................................................... 205
APPENDIX 2 TO SCHEDULE 4 ....................................................... 206
Alternative Transport .................................................................. 206
5 Fares ........................................................................................ 207
SCHEDULE 5.1 ........................................................................... 208
Purpose, Structure and Construction ............................................. 208
SCHEDULE 5.2 ........................................................................... 211
Franchisee's Obligation to Create Fares ......................................... 211
SCHEDULE 5.3 ........................................................................... 212
Allocation of Fares to Fares Baskets .............................................. 212
SCHEDULE 5.4 ........................................................................... 214
Regulation of Fares Basket Values ................................................ 214
SCHEDULE 5.5 ........................................................................... 217
Regulation of Individual Fares ...................................................... 217
SCHEDULE 5.6 ........................................................................... 220
Exceeding the Regulated Value, Regulated Price or Regulated Child
Price ......................................................................................... 220
SCHEDULE 5.7 ........................................................................... 221
Changes to Fares and Fares Regulation ......................................... 221
SCHEDULE 5.8 ........................................................................... 226
Fares Regulation Information and Monitoring ................................. 226
SCHEDULE 5.9 ........................................................................... 230
ITSO Certified Smartmedia .......................................................... 230
6 Committed Obligations and Other Provisions .................................. 256
SCHEDULE 6.1 ........................................................................... 257
Committed Obligations and Related Provisions ............................... 257
PART 1 TO SCHEDULE 6.1............................................................ 258
List of Committed Obligations ....................................................... 258
APPENDIX 3 ........................................................................................... 366
PUBLICATION OF PERFORMANCE DATA ..................................................... 366
APPENDIX 4 TO PART 1 OF SCHEDULE 6.1 ................................................. 368
SECRETARY OF STATE OTW REQUIREMENTS ............................................. 368
APPENDIX 5 TO PART 1 OF SCHEDULE 6.1 ................................................. 371
OTW TECHNICAL SPECIFICATION ............................................................. 371
APPENDIX 6 TO PART 1 OF SCHEDULE 6.1 ................................................. 376
OTW SECURITY REQUIREMENTS............................................................... 376
APPENDIX 7 TO PART 1 OF SCHEDULE 6.1 ................................................. 377
OTW PAYMENT TABLE ............................................................................. 377
PART 2 TO SCHEDULE 6.1............................................................ 385
Miscellaneous Provisions .............................................................. 385
SCHEDULE 6.2 ........................................................................... 389
TSGN Franchise Specific Provisions ............................................... 389
APPENDIX TO SCHEDULE 6.2 ....................................................... 423
PART 1 TO APPENDIX .................................................................. 423
Breach Initial Period Benchmark Table ........................................... 423
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
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PART 2 TO APPENDIX .................................................................. 424
Ticketless Travel Benchmark ........................................................ 424
PART 2 TO APPENDIX .................................................................. 426
Annual Ticketless Travel Benchmark ............................................. 426
PART 4 TO APPENDIX .................................................................. 427
Payment Table ........................................................................... 427
SCHEDULE 6.3 ........................................................................... 428
TLP/TRSP Related Provisions ........................................................ 428
SCHEDULE 6.4 ........................................................................... 442
Integration of the Southern Franchise Services ............................... 442
APPENDIX TO SCHEDULE 6.4 ....................................................... 462
HLOS Phase 2 Core Units - Cascade Dates ..................................... 462
7 Performance Benchmarks and the PEM Regime .............................. 463
SCHEDULE 7.1 ........................................................................... 464
Performance Benchmarks ............................................................ 464
APPENDIX 1 TO SCHEDULE 7.1 .................................................... 491
PART 1 TO APPENDIX 1 ............................................................... 491
Cancellations Benchmark Table .................................................... 491
PART 2 TO APPENDIX 1 ............................................................... 498
Annual Cancellations Benchmark Table .......................................... 498
PART 3 TO APPENDIX 1 ............................................................... 499
Annual Cancellations Payment Table ............................................. 499
APPENDIX 2 TO SCHEDULE 7.1 .................................................... 500
PART 1 TO APPENDIX 2 ............................................................... 500
Peak Short Formation Benchmark Table ........................................ 500
PART 2 TO APPENDIX 2 ............................................................... 507
Annual Peak Short Formation Benchmark Table .............................. 507
PART 3 TO APPENDIX 2 ............................................................... 508
Annual Peak Short Formations Payment Table ................................ 508
APPENDIX 3 TO SCHEDULE 7.1 .................................................... 509
PART 1 TO APPENDIX 3 ............................................................... 509
TOC Minute Delay Benchmark Table .............................................. 509
PART 2 TO APPENDIX 3 ............................................................... 517
Annual TOC Minute Delay Benchmark Table ................................... 517
PART 3 TO APPENDIX 3 ............................................................... 518
Annual TOC Minute Delay Payment Table ....................................... 518
SCHEDULE 7.2 ........................................................................... 519
PEM Regime ............................................................................... 519
APPENDIX 1 TO SCHEDULE 7.2 .................................................... 537
NPS Indicators, Benchmarks, Floors and Weightings ....................... 537
APPENDIX 2 TO SCHEDULE 7.2 .................................................... 539
QuEST Indicators and Weightings ................................................. 539
APPENDIX 3 TO SCHEDULE 7.2 .................................................... 542
PEM Benchmarks ........................................................................ 542
APPENDIX 4 TO SCHEDULE 7.2 .................................................... 543
PEM Payment ............................................................................. 543
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
5
APPENDIX 5 TO SCHEDULE 7.2 .................................................... 544
Basis for QuEST Inspections ......................................................... 544
8 Payments .................................................................................. 545
SCHEDULE 8.1 ........................................................................... 546
Franchise Payments .................................................................... 546
APPENDIX 1 TO SCHEDULE 8.1 .................................................... 585
Profit Share Thresholds ............................................................... 585
APPENDIX 2 TO SCHEDULE 8.1 .................................................... 587
Components of AFA and DFR ........................................................ 587
SCHEDULE 8.2 ........................................................................... 593
Annual Franchise Payments ......................................................... 593
APPENDIX TO SCHEDULE 8.2 ....................................................... 595
Figures for Calculation of Annual Franchise Payments ...................... 595
SCHEDULE 8.3 ........................................................................... 596
Miscellaneous Payment Provisions ................................................. 596
SCHEDULE 8.4 ........................................................................... 597
Track Access Adjustments and Station Charge Adjustments ............. 597
9 Changes and Variations ............................................................... 601
SCHEDULE 9.1 ........................................................................... 602
Financial and Other Consequences of Change ................................. 602
APPENDIX 1 TO SCHEDULE 9.1 .................................................... 611
Summary Flow Chart................................................................... 611
APPENDIX 2 TO SCHEDULE 9.1 .................................................... 613
Agreement or Determination of Revised Inputs ............................... 613
ANNEX TO APPENDIX 2 TO SCHEDULE 9.1 ..................................... 618
Incentivising Long Term Investment ............................................. 618
SCHEDULE 9.2 ........................................................................... 620
Identity of the Financial Model etc. ............................................... 620
SCHEDULE 9.3 ........................................................................... 623
Secretary of State Risk Assumptions ............................................. 623
APPENDIX TO SCHEDULE 9.3 ....................................................... 634
Assumed HLOS Sub Lease Amounts .............................................. 634
SCHEDULE 9.4 ........................................................................... 635
Component of FAT: Definition of Threshold Amount ........................ 635
SCHEDULE 9.5 ........................................................................... 636
Variations to the Franchise Agreement and Incentivising Beneficial
Changes .................................................................................... 636
10 Remedies, Termination and Expiry ................................................ 640
SCHEDULE 10.1 .......................................................................... 641
Remedial Plans and Remedial Agreements ..................................... 641
SCHEDULE 10.2 .......................................................................... 643
Termination and Expiry ............................................................... 643
SCHEDULE 10.3 .......................................................................... 644
Events of Default and Termination Events ...................................... 644
SCHEDULE 10.4 .......................................................................... 651
Force Majeure ............................................................................ 651
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
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SCHEDULE 10.5 .......................................................................... 656
Liability ..................................................................................... 656
11 Agreement Management Provisions ............................................... 658
12 Financial Obligations and Covenants ............................................. 661
APPENDIX 1 TO SCHEDULE 12 ..................................................... 672
Form of Performance Bond ........................................................... 672
APPENDIX 2 TO SCHEDULE 12 ..................................................... 678
Form of Season Ticket Bond ......................................................... 678
13 Information and Industry Initiatives .............................................. 684
APPENDIX 1 TO SCHEDULE 13 ..................................................... 704
Efficient Franchisee ..................................................................... 704
APPENDIX 2 TO SCHEDULE 13 ..................................................... 709
Key Assets ................................................................................. 709
APPENDIX 3 TO SCHEDULE 13 ..................................................... 710
Operational Information .............................................................. 710
APPENDIX 4 TO SCHEDULE 13 ..................................................... 714
Ticket and Revenue Information ................................................... 714
APPENDIX 5 TO SCHEDULE 13 ..................................................... 717
Environmental Impact Monitoring Dataset...................................... 717
14 Preservation of Assets ................................................................. 718
SCHEDULE 14.1 .......................................................................... 719
Maintenance of Franchise............................................................. 719
SCHEDULE 14.2 .......................................................................... 721
Maintenance of Operating Assets .................................................. 721
SCHEDULE 14.3 .......................................................................... 724
Key Contracts ............................................................................ 724
APPENDIX TO SCHEDULE 14.3 ..................................................... 728
List of Key Contracts ................................................................... 728
SCHEDULE 14.4 .......................................................................... 730
Designation of Franchise Assets .................................................... 730
APPENDIX TO SCHEDULE 14.4 ..................................................... 736
List of Primary Franchise Assets ................................................... 736
SCHEDULE 14.5 .......................................................................... 737
Dealing with Franchise Assets ...................................................... 737
15 Obligations Associated with Termination ........................................ 739
SCHEDULE 15.1 .......................................................................... 740
Reletting Provisions..................................................................... 740
SCHEDULE 15.2 .......................................................................... 746
Last 12 or 13 Months of Franchise Period and other conduct of business
provisions .................................................................................. 746
SCHEDULE 15.3 .......................................................................... 750
Handover Package ...................................................................... 750
APPENDIX TO SCHEDULE 15.3 ..................................................... 751
Form of Handover Package .......................................................... 751
SCHEDULE 15.4 .......................................................................... 752
Provisions Applying on and after Termination ................................. 752
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
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APPENDIX 1 TO SCHEDULE 15.4 ................................................... 760
Form of Transfer Scheme............................................................. 760
APPENDIX 2 TO SCHEDULE 15.4 ................................................... 764
Form of Supplemental Agreement ................................................. 764
16 Pensions .................................................................................... 783
17 Confidentiality and Freedom of Information .................................... 788
18 Additional Reporting Periods ........................................................ 794
19 Other Provisions ......................................................................... 795
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
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THIS AGREEMENT is dated 2014
BETWEEN
(1) THE SECRETARY OF STATE FOR TRANSPORT, whose principal address is at 33
Horseferry Road, London SW1P 4DR (the “Secretary of State”); and
(2) GOVIA THAMESLINK RAILWAY LIMITED (Company Number 07934306),
whose registered office is at 3rd Floor, 41-51 Grey Street, Newcastle upon Tyne
NE1 6EE (the “Franchisee”).
WHEREAS
(A) The Secretary of State wishes to appoint a franchisee to provide railway passenger
services within the Franchise and expects his franchisee, on the terms of the
Franchise Agreement, actively to seek, in all reasonable business ways, greatly
improved performance over the Franchise Term from its employees, its Train Fleet
and other assets, and from Network Rail and its other suppliers, so as to deliver
to the passenger the best railway passenger service that can be obtained from the
resources that are available to it.
(B) The Franchisee wishes to be appointed as the Secretary of State’s franchisee for
the Franchise and intends, on the terms of this Agreement, actively to seek, in all
reasonable business ways, greatly improved performance over the Franchise Term
from its employees, its Train Fleet and other assets, and from Network Rail and
its other suppliers, so as to deliver to the passenger the best railway passenger
service that can be obtained from the resources that are available to it.
(C) The following provisions of this Agreement are intended to reflect and give effect
to the matters referred to in Recitals (A) and (B) inclusive.
1. INTERPRETATION
1.1 In the Franchise Agreement, except to the extent the context otherwise requires:
(a) words and expressions defined in Part I of the Act have the same meanings when
used therein provided that, except to the extent expressly stated, “railway” shall
not have the wider meaning attributed to it by Section 81(2) of the Act;
(b) words and expressions defined in the Interpretation Act 1978 have the same
meanings when used in the Franchise Agreement;
(c) the words “include”, “including” and “in particular” are to be construed without
limitation;
(d) references to any person include its successors, transferees or assignees;
(e) the words “subsidiary”, “subsidiary undertaking”, and “parent undertaking” each
have the same meaning in the Franchise Agreement as in Section 1162 of the
Companies Act 2006;
(f) references to documents “in the agreed terms” are references to documents
initialled by or on behalf of the Secretary of State and the Franchisee. As at the
date of this Agreement the documents “in the agreed terms” are as follows:
(i) ABD Data for determining
Annual Benchmarks,
Annual Breach Ticketless
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
9
Travel Benchmark and
Annual Target Ticketless
Travel Benchmark where
there are fewer than 13
Reporting Periods;
(ii) BFP Bid Fares Policy;
(iii) CFD1 TGN Commuter Fares
Document;
(iv) CFD2 Combined Commuter
Fares Document;
(v) CR Customer Report;
(vi) DL Depot Lease;
(vii) ERTMSP Proposed ERTMS
Implementation Plan;
(viii) FF Financial Formats;
(ix) FM Financial Model;
(x) MP Marketing Plan;
(xi) OM Operational Model;
(xii) PC1 Passenger’s Charter
effective from the Start
Date;
(xiii) PC2 Passenger’s Charter
effective from the
Combined Effective Date;
(xiv) PFD1 TGN Protected Fares
Document;
(xv) PFD2 Combined Protected Fares
Document;
(xvi) PFS Penalty Fares Scheme;
(xvii) POA Power of Attorney;
(xviii) PSM Passenger Survey
Methodology;
(xix) QuSS QuEST Service Schedules;
(xx) ROA Record of Assumptions;
(xxi) SL Station Lease;
(xxii) SOL HLOS Phase 2 Lease;
(xxiii) SSD assumptions in relation to
the Southern SEFT Deed;
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
10
(xxiv) STNRCS1 STNR Costs Schedule
(xxv) STNRP2 STNR Programme
(xxvi) STNRRR3 STNR Reporting
Requirements
(xxvii) STNRSOW4 STNR Scope of Work
(xxviii) TP Train Plan;
(xxix) TSD assumptions in relation to
the TGN SEFT Deed;
(xxx) TSR1, TSR2, TSR3, TSR4,
TSR5, TSR6 and TSR7
Train Service
Requirements; and
(xxxi) TTSM Ticketless Travel Survey
Methodology; and
(xxxii) CMSP5 CMS Passenger Model
(xxxiii) TSSL6 TS Sub Lease Head of
Terms
(xxxiv) TSSLU7 Draft TS Sub Lease
Undertaking
(g) references in any of the agreements comprising the Franchise Agreement to
Recitals, clauses, Schedules, Parts, paragraphs and Appendices are to Recitals,
clauses, Schedules, Parts of Schedules, paragraphs of Schedules and Appendices
of Schedules of that agreement, unless expressly specified to the contrary, and
the Schedules and Appendices form part of the agreement in which they appear;
(h) references in any Schedule in any of the agreements comprising the Franchise
Agreement to a Part, paragraph or Appendix are references to a Part, paragraph
or Appendix of that Schedule (or the relevant Part of a Schedule), unless
expressly specified to the contrary;
lon_lib1\10436430\4 10 Derogations kokoa
1 17 January 2018 (Date of DOA) – Contract insertion agreed by the Secretary of
State and Franchisee. 2 17 January 2018 (Date of DOA) – Contract insertion agreed by the Secretary of
State and Franchisee. 3 17 January 2018 (Date of DOA) – Contract insertion agreed by the Secretary of
State and Franchisee. 4 17 January 2018 (Date of DOA) – Contract insertion agreed by the Secretary of
State and Franchisee. 5 05 November 2014 (Date of DOA) – Contract insertion agreed by the Secretary of
State and Franchisee. 6 05 November 2014 (Date of DOA) – Contract insertion agreed by the Secretary of
State and Franchisee. 7 05 November 2014 (Date of DOA) – Contract insertion agreed by the Secretary of
State and Franchisee.
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
11
(i) headings and references to headings shall be disregarded in construing the
Franchise Agreement;
(j) references to any enactment include any subordinate legislation made from time
to time under such enactment and are to be construed as references to that
enactment as for the time being amended or modified or to any enactment for
the time being replacing or amending it and references to any subordinate
legislation are to be construed as references to that legislation as for the time
being amended or modified or to any legislation for the time being replacing or
amending it;
(k) references to an agreement or any other document shall be construed as
referring to that agreement or document as from time to time supplemented,
varied, replaced, amended, assigned or novated;
(l) references to any particular provisions of any agreement or any other document
shall be construed to include any other provisions of, or incorporated in, that
agreement or other document which the Secretary of State reasonably considers
have an equivalent effect or are intended to fulfil the same function;
(m) words importing the masculine gender include the feminine and vice-versa, and
words in the singular include the plural and vice-versa;
(n) wherever provision is made for the giving or issuing of any notice, endorsement,
consent, approval, waiver, certificate or determination by any person, unless
otherwise specified, such notice, endorsement, consent, approval, waiver,
certificate or determination shall be in writing and the words “notify”, “endorse”,
“consent”, “approve”, “waive”, “certify” or “determine” and other cognate
expressions shall be construed accordingly;
(o) references to materials, information, data and other records shall be to materials,
information, data and other records whether stored in electronic, written or other
form;
(p) references to the Franchisee bidding for Train Slots or a Timetable shall mean
the final action incumbent on the Franchisee under the Network Code to confirm
to Network Rail its interests in the Train Slots to which that confirmation relates,
and “bid” shall be construed accordingly;
(q) references to the period of validity of any Fare are references to its period of
validity excluding any rights of any purchaser thereof to extend such period
under the Passenger's Charter, any equivalent document, or the terms and
conditions attaching to such Fare (including any applicable conditions of carriage)
in the event of the cancellation or delay of any of the railway passenger services
for which such Fare is valid;
(r) references to stations at which any train calls include stations at which such train
commences or terminates its journey;
(s) references to “railway passenger services” are to be construed subject to Section
40 of the Railways Act 2005;
(t) references to the provision of railway passenger services include the organisation
of the relevant train movements and making the necessary arrangements with
Network Rail or any other relevant Facility Owner;
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
12
(u) references in lower case letters to terms defined in clause 2 shall be construed,
where relevant, as being references to the terms defined as such in the franchise
agreement or relevant agreement made under Section 30 of the Act or Section
6 of the Railways Act 2005 with any other Train Operator;
(v) amendments to or variations of contracts or arrangements include assignments,
novations or other transfers of rights and/or obligations (in whole or in part)
under such contracts or arrangements;
(w) references to sums of money being expended by the Franchisee shall be to such
sums exclusive of Value Added Tax;
(x) the words “shall not be liable” are to be construed as meaning that no
contravention of the Franchise Agreement and no Event of Default shall arise as
a result of the occurrence of the matter to which such words relate;
(y) references to a “contravention of the Franchise Agreement” (and cognate
expressions) are to be construed as meaning a breach of the Franchise
Agreement; and
(z) wherever provision is made for the Franchisee to “procure” or “ensure” the
delivery of an obligation under the Franchise Agreement, unless otherwise
specified, that provision shall be construed as a primary obligation on the
Franchisee to deliver that obligation.
1.2 This Agreement and the Conditions Precedent Agreement together constitute a
single agreement, which is a “franchise agreement” for the purposes of the Act.
2. DEFINITIONS
2.1 In the Franchise Agreement, except to the extent the context otherwise requires,
the following words and expressions have the following meanings:
“16 to 25 Railcard” means a Discount Card issued under the
Discount Fare Scheme referred to in paragraph
(a)(ii) of the definition of Discount Fare
Scheme;
“2010 Nominal Ticket Sales” has the meaning given to it in paragraph 3 of
Schedule 5.4 (Regulation of Fares Basket
Values);
“2010 Ticket Revenue” has the meaning given to it in paragraph 4.1 of
Schedule 5.4 (Regulation of Fares Basket
Values);
“Accepted” or “Acceptance” shall have the meaning given to such term in
the HLOS Phase 2 MSA;
“Access Agreement” has the meaning given to the term “access
agreement” in Section 83(1) of the Act;
“Act” means the Railways Act 1993 and any
regulations or orders made thereunder;
“Actual Operating Costs” means:
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
13
(a) the Franchisee's total operating
expenses for the period being reviewed
as stated in its profit and loss account,
including any of the following operating
expenses that are payable during that
period:
(i) amounts payable to the
Secretary of State and
Network Rail (excluding
Revenue);
(ii) taxation;
(iii) shareholder distributions
including dividends;
(iv) interest payments or other
financing charges due and
paid (including any charges
due and paid in respect of
any bonding arrangements);
(v) capital expenditure (net of
grants received); and
(vi) lease payments in relation to
on-balance sheet leased
assets,
but excluding any of the following
expenses that are payable in that
period:
(A) interest relating to
on-balance sheet
leased assets;
(B) depreciation;
(C) amortisation; and
(D) bad debt
provisions; and
(b) either:
(i) plus any reduction in the total
amount owing by the
Franchisee to creditors over
that period; or
(ii) less any increase in the total
amount owing by the
Franchisee to creditors over
that period,
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
14
where creditors:
(A) include any
persons owed
amounts by the
Franchisee in
respect of
operating
expenses,
including the types
of expenses set out
in paragraphs
(a)(i) to (a)(v)
inclusive,
provisions and
deferred income
balances; but
(B) exclude persons
owed amounts by
the Franchisee in
respect of lease
liabilities in relation
to on-balance
sheet leased assets
and liabilities in
relation to grants
received for the
purchase of fixed
assets;
“Actual Passenger Demand” has the meaning given to it in paragraph 1.1 of
Schedule 1.5 (Information about Passengers);
“Actuary” has the meaning given to it in the Pension Trust;
“Additional Electrostar
Units”
means the six four car class 377/2 units with
painted numbers as follows:
377/208;
377/209;
377/210;
377/213;
377/214; and
377/215;
“Administration Fee” has the meaning given to it in paragraph 4.3 of
Schedule 10.3 (Events of Default and
Termination Events);
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
15
“Advance Purchase Train-
specific Fares”
has the meaning given to it under the Ticketing
and Settlement Agreement;
“Affiliate” means, in respect of any person, any person by
which that person is Controlled or which is
Controlled by that person, or any person which
is Controlled by any other Affiliate of that
person;
“[REDACTED8]”9 means the agreement for the provision of
information technology services between
the Franchisee and [REDACTED10] (as
amended and supplemented from time to
time);
“Aggregated Qualifying
Change”
means two or more Changes which:
(a) are notified or agreed (in the case of a
Change which is a Variation pursuant to
paragraph 1.1 of Schedule 9.5
(Variations to the Franchise Agreement
and Incentivising Beneficial Changes));
or
(b) a party has become aware of (in the
case of any other kind of Change),
in a Franchisee Year (the “Aggregation Year”)
which individually do not exceed the Threshold
Amount for the Aggregation Year taken alone
but do exceed it when taken together. For the
avoidance of doubt, where the Changes arise in
different Franchisee Years, for the purposes of
determining whether in aggregate they exceed
the Threshold Amount:
(c) the net present value of the adjustment
in Franchise Payments which would
result from a Run of the Financial Model
in respect of each Change shall be
calculated in accordance with the
lon_lib1\10436430\4 15 Derogations kokoa
8 Date of redaction 23/04/2018 - Where text has been omitted from the document
this is because the Secretary of State has decided to exclude the text in accordance
with the provisions within the Freedom of Information Act 2000. 9 17 January 2018 (Date of DOA) – Contract insertion agreed by the Secretary of
State and Franchisee.
10 Date of redaction 23/04/2018 - Where text has been omitted from the document
this is because the Secretary of State has decided to exclude the text in accordance
with the provisions within the Freedom of Information Act 2000.
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
16
process described in the definition of
Qualifying Change; and
(d) there will be an Aggregated Qualifying
Change where the aggregate of the net
present values of those Changes
exceeds the Threshold Amount for the
Aggregation Year;
“Agreed Marketing Spend” has the meaning given to such term in
paragraph 4.1 of Schedule 6.2 (TSGN Franchise
Specific Provisions);
“Alliance Agreement” has the meaning given to such term in
paragraph 11.2 of Schedule 13 (Information
and Industry Initiatives);
“Alternative Scheme” means a Committed Obligation proposed by the
Franchisee in place of a Specimen Scheme in
accordance with paragraph 8 of Part 2 of
Schedule 6.1 (Committed Obligations and
Related Provisions);
“Alternative TSR” has the meaning given to such term in
paragraph 1.2 of Schedule 1.1 (Service
Development);
“Ancillary Revenue” means revenue received by the Franchisee in
respect of:
(a) parking of vehicles at stations;
(b) the provision of Light Maintenance
Services and heavy maintenance
services;
(c) the provision of Station Services but
only in respect of the Station Services
specified in paragraphs 3.1(b) and 3.2
of Schedule 1.6 (Franchise Services);
(d) the sub leasing, hiring or licensing of
rolling stock vehicles or other assets;
(e) the sale of advertising space at
Stations and on trains;
(f) the lending, seconding, hiring or
contracting out of Franchise Employees
to other Train Operators;
(g) the letting of property;
(h) the provision of Charter Services;
(i) the provision of consultancy services;
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
17
(j) retail commission;
(k) the sale of an asset to the extent that
any such sale is permitted under the
Franchise Agreement;
(l) the sale of goods or services provided
principally for consumption or use on
the relevant train including meals, light
refreshments, newspapers, magazines,
books, entertainment materials, phone
cards or Wi-Fi;
(m) commission from taxi bookings;
(n) income associated with the provision
by third party operators of Wi-Fi at
Stations;
(o) the operation of a shuttle bus service
linking Luton Airport Parkway Station
with Luton Airport; and
(p) 11 revenue in respect of OTW
Ancillary Services and OTW
Additional Services (each as
defined in paragraph 21 of Part 1
(List of Committed Obligations) of
Schedule 6.1 (Committed
Obligations and Related
Provisions)) provided that any
profits in respect of such OTW
Ancillary Services and/or OTW
Additional Services shall not count
towards the profit share under
paragraph 7 of Schedule 8.1
(Franchise Payments),
provided that:
(i) Ancillary Revenue shall
exclude any revenue derived
from the sale of goods or
services under an
arrangement which by itself
would entitle a purchaser of
such goods or services to
travel on the Passenger
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Secretary of State and the Franchisee.
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
18
Services without the need to
purchase a Fare; and
(ii) Ancillary Revenue shall
include:
(A) any amounts
received from
Network Rail
excluding any
amounts payable
to the Secretary of
State pursuant to
paragraph 6 of
Schedule 2.2
(Security of Access
Agreements,
Rolling Stock
Leases, Station and
Depot Leases),
paragraphs 6.4 and
7 of Schedule 6.2
(TSGN Franchise
Specific Provisions)
and Schedule 8.4
(Track Access
Adjustments and
Station Charge
Adjustments); and
(B) income in the
nature of
compensation
received by the
Franchisee from
any person in
respect of costs,
losses or liabilities
incurred by the
Franchisee whether
under or in respect
of a contract or
otherwise
including:
(1) as provided under
paragraph (A)
above,
(2) under any TRSP
Document, Rolling
Stock Related
Contract or
contract of
insurance; and
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
19
(3) loss of revenue but
only to the extent
that such revenue
is comprised in this
definition of
Ancillary Revenue;
but
(4) excluding any
amounts (and
where relevant
compensation)
received in respect
of or related to any
Fare, Penalty Fare,
Discount Cards,
Railcards, multi-
model schemes,
concessionary
fares schemes or
integrated
transport schemes
or any other similar
or equivalent
arrangement; and
nothing in this definition of Ancillary
Revenue shall relieve the Franchisee
of any liability to the Secretary of
State howsoever arising;
“Ancillary Service” 12 means any service specified in paragraph 5 of
Schedule 1.6 (Franchise Services);
“Annual Audited Accounts” means the accounts of the Franchisee which:
(a) comply with paragraph 3.11 of
Schedule 13 (Information and Industry
Initiatives); and
(b) are delivered to the Secretary of State
by the Franchisee in accordance with
paragraph 3.9 of Schedule 13
(Information and Industry Initiatives)
and certified by the Franchisee's
auditors as true and fair;
“Annual Benchmark” means any of the Annual Cancellations
Benchmark, Annual Peak Short Formation
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12 05 November 2014 (Date of DOA) – Contract insertion agreed by the Secretary of
State and Franchisee.
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
20
Benchmark and Annual TOC Minute Delay
Benchmark;
“Annual Benchmark Table” means, in relation to:
(a) any Annual Cancellations Benchmark,
the Annual Cancellations Benchmark
Table;
(b) any Annual Peak Short Formation
Benchmark, the Annual Peak Short
Formation Benchmark Table; and
(c) any Annual TOC Minute Delay
Benchmark, the Annual TOC Minute
Delay Benchmark Table;
“Annual Breach Performance
Level”
means, in relation to an Annual Benchmark for
any Performance Calculation Year, the number
set out in Column 4 of the Annual Benchmark
Table relating to that Annual Benchmark and in
the row of that table for that Performance
Calculation Year;
“Annual Breach Ticketless
Travel Benchmark”
means, in relation to a Performance Calculation
Year, the benchmark for that Performance
Calculation Year as specified in Column 3 of the
table in Part 3 of the Appendix to Schedule 6.2
(TSGN Franchise Specific Provisions) provided
that where a Performance Calculation Year is
shorter than 13 Reporting Periods then the
Annual Breach Ticketless Travel Benchmark for
that Performance Calculation Year shall be as
determined pursuant to 2.6(a) of Schedule 6.2
(TSGN Franchise Specific Provisions);
“Annual Cancellations
Benchmark”
means for each Performance Calculation Year,
each of the benchmarks specified in the Annual
Cancellations Benchmark Table for that
Performance Calculation Year provided that
where a Performance Calculation Year is shorter
than 13 Reporting Periods then the Annual
Cancellations Benchmark for that Performance
Calculation Year shall be as determined
pursuant to paragraph 5.1(a) of Schedule 7.1
(Performance Benchmarks);
“Annual Cancellations
Benchmark Table”
means the table set out in Part 2 of Appendix 1
of Schedule 7.1 (Performance Benchmarks);
“Annual Cap Performance
Level”
means, in relation to an Annual Cancellations
Benchmark and an Annual TOC Minute Delay
Benchmark (as the case may be) for any
Performance Calculation Year, the number set
out in Column 2 of the Annual Cancellations
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
21
Benchmark Table or the Annual TOC Minute
Delay Benchmark Table (as the case may be);
[DELETED13]
“Annual Franchise Payment” means, in relation to any Franchisee Year, the
amount determined in accordance with
Schedule 8.2 (Annual Franchise Payments);
“Annual Franchise Payment
Components”
means the values of “FXD”, “VCRPI”, “VCAWE”,
“PRPI” and “ARRPI” specified for each
Franchisee Year in the table set out in the
Appendix (Figures for Calculation of Annual
Franchise Payments) to Schedule 8.2 (Annual
Franchise Payments);
“Annual Intermediate Peak
Short Formation Payment
Level”
means, in relation to the Annual Peak Short
Formation Benchmark for any Performance
Calculation Year, the number set out in
Column 2 of the Annual Peak Short Formation
Benchmark Table and in the row of that table
for that Performance Calculation Year;
“Annual Management
Accounts”
means the management accounts of the
Franchisee which:
(a) comply with paragraph 3.10 of
Schedule 13 (Information and Industry
Initiatives); and
(b) are delivered to the Secretary of State
by the Franchisee in accordance with
paragraph 3.6 of Schedule
13 (Information and Industry
Initiatives);
“Annual Peak Short
Formation Benchmark”
means for each Performance Calculation Year,
each of the benchmarks specified in the Annual
Peak Short Formation Benchmark Table for that
Performance Calculation Year provided that
where a Performance Calculation Year is shorter
than 13 Reporting Periods then the Annual Peak
Short Formation Benchmark for that
Performance Calculation Year shall be as
determined pursuant to paragraph 5.1(b) of
Schedule 7.1 (Performance Benchmarks);
lon_lib1\10436430\4 21 Derogations kokoa
13 Date of deletion 25/02/2016.
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
22
“Annual Peak Short
Formation Benchmark
Table”
means the table set out in Part 2 of Appendix 2
of Schedule 7.1 (Performance Benchmarks);
“Annual Season Ticket” means a Season Ticket Fare which is valid in
Standard Class Accommodation from (and
including) the day on which it first comes into
effect until (but excluding) the day which falls
12 months after such day;
“Annual Target Performance
Level”
means, in relation to an Annual Benchmark, the
number set out in Column 3 of the Annual
Benchmark Table relating to that Annual
Benchmark and in the row of that table for that
Performance Calculation Year;
“Annual Target Ticketless”
Travel Benchmark”
means, in relation to a Performance Calculation
Year, the benchmark for that Performance
Calculation Year as specified in Column 2 of the
table in Part 3 of the Appendix to Schedule 6.2
(TSGN Franchise Specific Provisions) provided
that where a Performance Calculation Year is
shorter than 13 Reporting Periods then the
Annual Target Ticketless Travel Benchmark for
that Performance Calculation Year shall be as
determined pursuant to paragraph 2.6(a) of
Schedule 6.2 (TSGN Franchise Specific
Provisions);
“Annual Ticketless Travel
Benchmark”
means any of the Annual Breach Ticketless
Travel Benchmark and Annual Target Ticketless
Travel Benchmark;
“Annual TOC Minute Delay
Benchmark”
means, for each Performance Calculation Year,
each of the benchmarks specified in the Annual
TOC Minute Delay Benchmark Table for that
Performance Calculation Year provided that
where a Performance Calculation Year is shorter
than 13 Reporting Periods then the Annual TOC
Minute Delay Benchmark for that Performance
Calculation Year shall be as determined
pursuant to paragraph 5.1(c) of Schedule 7.1
(Performance Benchmarks);
“Annual TOC Minute Delay
Benchmark Table”
means the table set out in Part 2 of Appendix 3
of Schedule 7.1 (Performance Benchmarks);
“Assisted Passenger
Reservation System”
means the system known as the Assisted
Passenger Reservation System as described in
the Code of Practice as published in September
2010 (version 2 – valid from 1 September
2010);
“Assumed Revenue” means in relation to any Reporting Period the
amount determined as such in accordance with
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
23
paragraph 3 of Schedule 8.1 (Franchise
Payments);
“ATOC” means the Association of Train Operating
Companies including any of its successors and
assigns;
“Average Weekly Earnings” means the United Kingdom average weekly
earnings measure excluding bonuses as
published from time to time by the Office for
National Statistics or, if such measure shall
cease to be published or if, in the reasonable
opinion of the Secretary of State, there is a
material change in the basis of such measure,
such other alternative index as the Secretary of
State may, after consultation with the
Franchisee, determine to be appropriate in the
circumstances;
“Bank” means a person which has a permission under
Part 4A of the Financial Services and Markets
Act 2000 to carry on the regulated activity of
accepting deposits thereunder and which is
reasonably acceptable to the Secretary of
State;
“Bank Holiday” means any day other than a Saturday or
Sunday on which banks in the City of London
are not open for business;
“Benchmark” means any of the Cancellations Benchmark,
TOC Minute Delay Benchmark and Peak Short
Formation Benchmark;
“Benchmark Table” means, in relation to:
(a) any Cancellations Benchmark, the
Cancellations Benchmark Table; and
(b) any Peak Short Formation Benchmark,
the Peak Short Formation Benchmark
Table; and
(c) any TOC Minute Delay Benchmark, the
TOC Minute Delay Benchmark Table;
“Bid Fares Policy” means the document in the agreed form
marked “BFP” and which complies with the
requirements of paragraph 2 of Schedule 5.8
(Fares Regulation Information and Monitoring);
“Bid Profit Stream” means the estimated total operating profit of
the Franchisee from the date that the Change of
Control (pursuant to paragraph 2.3 of Schedule
10.3 (Events of Default and Termination
Events) is to occur until the Expiry Date as
shown in the profit and loss forecast in the
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
24
Initial Business Plan (without taking into
account any Updated Business Plan) calculated
in real terms as at the date of the Change of
Control and applying the prevailing discount
rate per annum (in real terms) stated in HM
Treasury’s “Green Book Appraisal Guidelines”
(such rate being 3.5 per cent. per annum (in
real terms) as at the date of the Franchise
Agreement);
“Bond Provider” means any person or persons who may provide
or be an obligor under a Performance Bond or
Season Ticket Bond from time to time and who
shall, unless the Secretary of State otherwise
agrees, be a Bank;
“Bond Year” means the period beginning on the Start Date
and ending on the day immediately preceding
the Combined Effective Date and any
subsequent period of 13 Reporting Periods
beginning on the day after the end of the
preceding Bond Year provided that:
(a) the Franchisee and the Secretary of
State may agree to vary the Reporting
Period in which a Bond Year ends from
time to time; and
(b) the last Bond Year shall expire on the
expiry of the Franchise Period and may
be a period of less than 13 Reporting
Periods;
“Brand Licence” means a licence between the Secretary of State
(or any company wholly owned by the Secretary
of State) and the Franchisee in respect of any
registered or unregistered trademarks;
“Breach Initial Period
Benchmark”
means, in relation to each of the first three
Ticketless Travel Survey Periods falling within
the first Performance Calculation Year the
relevant benchmark specified in the second row
of the table in Part 1 of the Appendix to
Schedule 6.2 (TSGN Franchise Specific
Provisions);
“Breach Performance Level” means, in relation to a Benchmark for any
Reporting Period, the number set out in
Column 3 of the Benchmark Table relating to
that Benchmark and in the row of that table for
that Reporting Period;
“Breach Period Performance
Level”
means, in relation to a Benchmark for any
Breach Reporting Period, the numbers set out in
Column 5 of the Benchmark Table relating to
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
25
that Benchmark and in the row of that table for
that Breach Reporting Period;
“Breach Reporting Periods” means any of the 6th to 12th Reporting Periods
in the first Performance Calculation Year;
“Breach Ticketless Travel
Benchmark”
means, in relation to a Ticketless Travel Survey
Period, the benchmark relevant for that
Ticketless Travel Survey Period in that
Performance Calculation Year as specified in
Column 3 of the table in Part 2 of the Appendix
to Schedule 6.2 (TSGN Franchise Specific
Provisions);
“British Transport Police” means the British Transport Police created
pursuant to Section 18 of the Railways and
Transport Safety Act 2003 (or any successor or
successors to its statutory policing functions);
“Business Action Plan” means an action plan produced by the
Franchisee in relation to the delivery of any
aspect of the Franchise Services (including in
respect of any outcome anticipated by its
Business Plan, in accordance with paragraph 2.6
of Schedule 13 (Information and Industry
Initiatives));
“Business Continuity Plan”
and “BCP” a business continuity and disaster recovery plan
(including a Force Majeure Events recovery
plan) required to be produced, maintained and
implemented by the Franchisee in accordance
with paragraph 3.3 of Schedule 10.4 (Force
Majeure);
“Business Plan” means the Initial Business Plan or any Updated
Business Plan, as the context requires, to be
delivered in accordance with paragraphs 2.1
and 2.2 of Schedule 13 (Information and
Industry Initiatives);
“Calculation Year” means:
(a) the period of 13 Reporting Periods
starting with the first Reporting Period
commencing in January 2015; or
(b) each subsequent and non-overlapping
period of 13 Reporting Periods during
the Franchise Period commencing the
day after the last day of the preceding
Calculation Year,
provided that the final Calculation Year may be
shorter or longer than 13 Reporting Periods as
follows:
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
26
(i) except where paragraph (ii)
below applies, the final
Calculation Year shall start on
the day after the last day of
the immediately preceding
Calculation Year and shall
end on the last day of the
Franchise Period; and
(ii) where the Secretary of State
extends the Franchise
Agreement pursuant to
paragraph 1.2 of Schedule 18
(Additional Reporting
Periods) such that the Expiry
Date falls prior to 30 June in
the last calendar year of the
Franchise Term, the final
Calculation Year shall start
with the first Reporting
Period commencing in the
January of the calendar year
preceding the calendar year
in which the Expiry Date falls,
and shall end on the last day
of the Franchise Period;
“Cancellation” means a Passenger Service:
(a) which is included in the Enforcement
Plan of the Day and which is cancelled
and attributed to the Franchisee
pursuant to its Track Access
Agreement; or
(b) which is included in the Enforcement
Plan of the Day and which operates less
than 50 per cent. of its scheduled
mileage (as prescribed in the
Enforcement Plan of the Day) for
reasons attributed to the Franchisee
pursuant to its Track Access
Agreement;
“Cancellations Benchmark” means any of the performance levels in respect
of Cancellations and Partial Cancellations set
out in the Cancellations Benchmark Table;
“Cancellations Benchmark
Table”
means the table set out in Part 1 of Appendix 1
(Cancellations Benchmark Table) of Schedule
7.1 (Performance Benchmarks);
“Cancellations Performance
Sum”
means the amount of an adjustment to a
Franchise Payment to be determined in
accordance with paragraph 3.2 of Schedule 7.1
(Performance Benchmarks);
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
27
“Capacity Mitigation Plan” has the meaning given to it in paragraph 8.1(a)
of Schedule 1.1 (Service Development);
“Capital Expenditure” has the meaning given to it in paragraph 2.4 of
Schedule 9.5 (Variations to the Franchise
Agreement and Incentivising Beneficial
Changes);
“Cascaded Rolling Stock” has the meaning given to it in paragraph 2.5 of
Schedule 2.2 (Security of Access Agreements,
Rolling Stock Leases, Station and Depot
Leases);
“Certificate of
Commencement”
means the certificate to be issued by the
Secretary of State pursuant to the Conditions
Precedent Agreement;
“Change”14 means if and whenever any of the following
occurs:
(a) an event set out in any Secretary of
State Risk Assumption specified in
Schedule 9.3 (Secretary of State Risk
Assumptions);
(b) a direction by the Secretary of State
pursuant to paragraph 6.3(ii) or
paragraph 6.3(iii) of Schedule 6.4
(Integration of the Southern Franchise
Services);
(c) a Charge Variation;
(d) a Change of Law (excluding any
Change of Law to the extent that it
results in an adjustment to the
Franchise Payments pursuant to
Schedule 8.4 (Track Access
Adjustments and Station Charge
Adjustments));
(e) a change to the Train Service
Requirement previously in force
pursuant to the issue of an amended or
new Train Service Requirement in
accordance with paragraph 8.5 of
Schedule 1.1 (Service Development);
(f) the issue of any TSR (TDR)
Amendments pursuant to paragraph
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VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
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5.7 of Schedule 1.1 (Service
Development) or, subject to paragraph
5.10(b) of Schedule 1.1 (Service
Development), any TSR (TDR)
Amendments ceasing to have effect in
accordance with paragraph 5.9 of
Schedule 1.1 (Service Development);
(g) the Franchisee is required to take any
action pursuant to paragraph 11.1(a)
and/or paragraph 11.1(b) of Schedule
1.1 (Service Development);
(h) the Secretary of State effects an
amendment to a Discount Fare
Scheme, introduces a new Discount
Fare Scheme or ceases to approve a
Discount Fare Scheme for the purposes
of Section 28 of the Act;
(i) the Secretary of State approves an
amendment or proposed amendment
to an Inter-Operator Scheme, as
referred to in paragraph (a) of the
definition of Inter-Operator Scheme to
the extent and only to the extent that
the Franchisee makes a saving as a
consequence of such amendment or
proposed amendment;
(j) the imposition, subject to the
provisions of paragraph 2.6 of
Schedule 4 (Persons with Disabilities
and Disability Discrimination), of any
increased access charges in respect of
EA Requirements at Franchisee Access
Stations;
(k) the Secretary of State exercises his
power pursuant to paragraph 5 of
Schedule 5.7 (Changes to Fares and
Fares Regulation) to alter the
obligations of and restrictions on the
Franchisee under Schedule 5 (Fares);
(l) the Franchisee is obliged to charge
Value Added Tax on a Fare or there is
an increase or decrease in the rate of
Value Added Tax which it must charge
on such Fare, in either case due to a
change in the Value Added Tax
treatment of the provision of Passenger
Services;
(m) the Secretary of State exercises his
rights pursuant to paragraph 2.5(b) of
Schedule 2.2 (Security of Access,
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
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Rolling Stock, Leases, Station and
Depot Leases);
(n) a Variation to the terms of the
Franchise Agreement pursuant to
paragraph 1 of Schedule
9.5 (Variations to the Franchise
Agreement and Incentivising Beneficial
Changes);
(o) the Start Date is a date that is later
than 0200 on 14 September 2014 for
reasons solely attributable to any act or
omission by the Secretary of State
except where:
(i) the Secretary of State
exercises his rights pursuant
to Clauses 4.2 or 4.3 of the
Conditions Precedent
Agreement to alter such Start
Date; or
(ii) the relevant acts or
omissions of the Secretary of
State arise as a result of or in
connection with any failure
by the Franchisee to satisfy
any of the conditions
precedent set out in the
Conditions Precedent
Agreement; or
(p) the Combined Effective Date is a date
that is later or earlier than 0200 on 26
July 2015 provided that:
(i) if such Change:
(A) is a Qualifying
Change and arises
because the
Combined Effective
Date is a date
which is later than
the 0200 on 26 July
2015 there shall be
a further Qualifying
Change on the
occurrence of the
actual Combined
Effective Date;
and/or
(B) has occurred
because the
Franchisee has
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30
contravened any of
the obligations
under paragraph 1
of Schedule 6.4
(Integration of the
Southern Franchise
Services) then for
the avoidance of
doubt, such
Change shall be
without prejudice
to any other rights
the Secretary of
State may have
(under the
Franchise
Agreement or
otherwise) in
respect of such
contravention or
default (including
under paragraph 2
of Appendix 2 to
Schedule 9.1
(Financial and
Other
Consequences of
Change); and
(ii) the provisions of paragraph 5
of Schedule 9.1 shall
automatically apply without
the need for the service of a
notice as contemplated under
that paragraph;
(q) either:
(i) the Secretary of State, in
his absolute discretion,
elects at any time within
two months of the
occurrence of a Force
Majeure Event that such
event shall be treated as a
Change; or
(ii) a Force Majeure Event that
continues with the effect of
preventing the Franchisee
from delivering, wholly or
mainly, the Passenger
Services for more than two
consecutive months;
(r) the Secretary of State exercises his
discretion pursuant to paragraph 4.4 of
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31
Schedule 6.2 (TSGN Franchise Specific
Provisions) to increase or decrease the
amount of the Agreed Marketing
Spend;
(s) the exercise by the Secretary of State
of his rights pursuant to paragraph 1.7
of Schedule 7.1 (Performance
Benchmarks);
(t) the circumstances specified in
paragraph 5.7(c) of Schedule 6.4
(Integration of the Southern Services)
occur;
(u) the Secretary of State exercises his
rights to vary the provisions of
Schedule 7.2 (PEM Regime) in the
manner contemplated in paragraph 6.2
of Schedule 7.2;
(v) the exercise by the Secretary of State
of his rights pursuant to paragraph
19.2 of Schedule 13 (Information and
Industry Initiatives);
(w) any two or more of the foregoing that
the Secretary of State groups together
in accordance with any procedures
issued by him pursuant to
paragraph 1.4 of Schedule 9.5
(Variations to the Franchise Agreement
and Incentivising Beneficial Changes);
“Change of Control” has the meaning given to it in paragraph 2.3 of
Schedule 10.3 (Events of Default and
Termination Events);
“Change of Law” means the coming into effect after the date of
the Franchise Agreement of:
(a) Legislation; or
(b) any applicable judgment of a court of
Law which changes a binding
precedent,
the terms of which apply only to the railway
industry, a particular section of the railway
industry or the provision of services to the
railway industry and not to other transport
modes or to industries other than the railway
industry, and without limitation:
(i) excluding any changes in
Taxation;
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
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(ii) excluding any changes which
were foreseeable at the date
of the Franchise Agreement,
and for this purpose, but
without limitation, there shall
be regarded as foreseeable
any Legislation which on the
date of the Franchise
Agreement has been
published:
(A) in a draft
parliamentary bill
as part of a
government
departmental
consultation paper;
(B) in a parliamentary
bill;
(C) in a draft statutory
instrument; or
(D) as a proposal in the
Official Journal of
the European
Communities
except to the
extent that such
proposal is
intended to apply
solely within
member states
other than the
United Kingdom,
to the extent that the same is
subsequently enacted in substantially
the same form as the form in which it
was previously so published. In relation
to the application of this sub paragraph
(ii), each TSI shall be considered
separately.
Change of Law (1) includes any Legislation,
which only applies to the railway industry, which
is made under the Health and Safety at Work
etc. Act 1974 and which is not excluded under
(i) and (ii) (a “Specifically Included Change
of Law”), but (2) excludes any Legislation
(other than a Specifically Included Change of
Law) which is made with the intention or effect
of specifically applying to (or disapplying in
relation to) the railway industry any other
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
33
Legislation which does not apply only to the
railway industry;
“Charge Variation” means a variation:
(a) to a Relevant Agreement; and
(b) which is effected as a result of a
Charging Review (including any
variation in connection with an
Incremental Output Statement
Charge);
“Charging Review” means:
(a) the exercise by the ORR of its powers
under:
(i) Part 7 of Schedule 7 of the
Track Access Agreement to
which the Franchisee is a
party on the Start Date or
any Replacement Agreement
which is or is deemed to be a
Relevant Agreement in
accordance with the
definition of that term;
(ii) Condition F11.5 of the
Station Access Conditions in
relation to any station which
is not an Independent
Station; or
(iii) Condition 42.5 of the
Independent Station Access
Conditions in relation to any
station which is an
Independent Station;
(b) the following by the ORR of the
procedure in Schedule 4A of the Act;
(c) the exercise by the ORR of any of its
powers or the following of any other
procedure, which, in the Secretary of
State's reasonable opinion:
(i) has an equivalent effect to;
or
(ii) is intended to fulfil the same
function as,
any of the powers referred to in
paragraphs (a) or (b) in relation to any
Relevant Agreement. For this purpose,
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
34
Relevant Agreement includes any
Relevant Agreement which is not the
subject of any previous Charging
Review; or
(d) any amendment to a Relevant
Agreement, or entry into a new
Relevant Agreement which is approved
by the ORR to the extent that it relates
to an Incremental Output Statement
Charge or a scheme to which that
charge relates;
“Charter Service” means a railway passenger service, whether
operated on the same routes as the Passenger
Services or not:
(a) which is not reflected in the Timetable;
(b) which does not conform to the pattern
of railway passenger services normally
provided by the Franchisee;
(c) for which the advance booking or
booking arrangements for seats on the
relevant service are, in the reasonable
opinion of the Secretary of State,
materially different from those
generally applicable to the Passenger
Services;
(d) for which tickets are available on a
restricted basis or on terms and
conditions which, in the reasonable
opinion of the Secretary of State, are
materially different from those
generally applicable to the Passenger
Services; and/or
(e) for which the departure time, journey
time and calling pattern are, in the
reasonable opinion of the Secretary of
State, materially different from those
of the Passenger Services,
and which, in the opinion of the Secretary of
State, is not a railway passenger service
provided by the Franchisee as part of the
Passenger Services;
“Child Price” means, in relation to any Fare, the amount
charged or chargeable to a person under the
age of 16 in respect of such Fare;
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
35
[REDACTED15]
“Class 377 Lot 10A Units” means the 12 dual voltage class 377 four car
units ordered by the Southern Franchisee
pursuant to a manufacture and supply
agreement dated 8 March 2002 (as amended
from time to time);
“Class 377 Lot 10B Units”
means the 11 dual voltage class 377 four car
units ordered by the Southern Franchisee
pursuant to a manufacture and supply
agreement dated 5 March 2008 (as amended
from time to time);
"Class 377 Sub-Lease"16 means:
(a) (in relation to the period commencing
on the date of the 2017 LSER Capacity
Enhancement Deed of Amendment
and expiring on the end date of the
LSER Franchise Agreement) the Class
377 (2017 LSER Capacity
Enhancement) Sub-Lease Version 1
together with the 2016 OHA; and
(b) (in relation to the period commencing
on the end date of the LSER Franchise
Agreement and ending [REDACTED17]
and the end of the Franchise Term)
the Class 377 (2017 LSER Capacity
Enhancement) Sub-Lease Version 2;
lon_lib1\10436430\4 35 Derogations kokoa
15 5 November 2014 (Date of Redactions Approval) – Where text has been omitted
from the document this is because the Secretary of State has decided to exclude
the text in accordance with the provisions within the Freedom of Information Act
2000. 16 08/09/2017 ( Date of Deed of Amendment) Agreed by the Secretary of State and
Franchisee.
17 Where text has been omitted from the document this is because the Secretary of
State has decided to exclude the text in accordance with the provisions within the
Freedom of Information Act 2000.
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
36
"Class 377 (2017 LSER
Capacity Enhancement) Sub-
Lease Version 1"18
means the sub-lease in relation to the
period commencing on the date of the
2017 LSER Capacity Enhancement Deed of
Amendment and expiring on the end date
of the LSER Franchise Agreement for the
Class 377 (2017 LSER Capacity
Enhancement) Units between the
Franchisee and the LSER Franchisee in the
form set out in Schedule 3 of the 2017
LSER Capacity Enhancement Deed of
Amendment;
"Class 377 (2017 LSER
Capacity Enhancement) Sub-
Lease Version 2"19
means the sub-lease in relation to the
period commencing on the end date of the
LSER Franchise Agreement and expiring on
the earlier of [REDACTED20] and the date of
expiry of the Franchise Term for:
(a) the Class 377 (2017 LSER Capacity
Enhancement) Units; and
(b) the Class 377 (2016 OHA) Units,
between the Franchisee and the successor
operator to the LSER Franchisee in the
form set out in Schedule 4 of the 2017
LSER Capacity Enhancement Deed of
Amendment;
"Class 377 (2016 OHA)
Units"21
means the 8 units of Class 377 units with
numbers 377501 to 377508, and "Class
377 (2016 OHA) Units" shall mean any one
of the Class 377 (2016 OHA) Units;
lon_lib1\10436430\4 36 Derogations kokoa
18 08/09/2017 ( Date of Deed of Amendment) Agreed by the Secretary of State and
Franchisee. 19 08/09/2017 ( Date of Deed of Amendment) Agreed by the Secretary of State and
Franchisee.
20 Where text has been omitted from the document this is because the Secretary of
State has decided to exclude the text in accordance with the provisions within the
Freedom of Information Act 2000. 21 08/09/2017 ( Date of Deed of Amendment) Agreed by the Secretary of State and
Franchisee.
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
37
"Class 377 (2017 LSER
Capacity Enhancement)
Units"22
means the 17 units of Class 377 rolling
stock (being numbers 377509 – 377523
and 377163 to 377164), and "Class 377
(2017 LSER Capacity Enhancement) Unit"
shall mean any one of the Class 377 (2017
LSER Capacity Enhancement) Units;
“Closed Scheme Employees” has the meaning given to it in paragraph 2.2 of
Schedule 16 (Pensions);
“Closure” means a discontinuance or closure under Part 4
of the Railways Act 2005 of any of the
Passenger Services or of any network on which
the Passenger Services may be operated or of
any of the Stations or of any part of such
network or Station;
“CMS Passenger Model”23 means the model in the agreed terms
marked “CMSP” as may be subsequently
revised in accordance with paragraph 14.1
of Schedule 6.2 (TSGN Franchise Specific
Provisions)”
“Code of Practice” means the code of practice for protecting the
interests of users of railway passenger services
or station services who have disabilities, as
prepared, revised from time to time and
published by the Secretary of State pursuant to
Section 71B of the Act;
“Collateral Agreement” means an agreement which is required to be
entered into by the Franchisee with Network
Rail or any other franchisee as a condition to
any Access Agreement of which the Franchisee
is the beneficiary;
“Combined Effective Date” means the date upon which the Franchisee
commences the operation of the Southern
Franchise Services, such date currently
anticipated to be 26 July 2015 or such earlier or
later date as may be required by the Secretary
of State (in consultation with the Franchisee);
“Combined Effective Date
Transfer Scheme”
has the meaning given to such term in
paragraph 3.1 of Schedule 6.4 (Integration of
the Southern Franchise Services);
lon_lib1\10436430\4 37 Derogations kokoa
22 08/09/2017 ( Date of Deed of Amendment) Agreed by the Secretary of State and
Franchisee. 23 5 November 2014 (Date of DOA) - Contract insertion agreed by the Secretary of
State and Franchisee.
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
38
“Committed Obligations” means any of the Franchisee's obligations listed
in Part 1 (List of Committed Obligations) to
Schedule 6.1 (Committed Obligations and
Related Provisions);
“Community Rail
Partnership”
means any not-for-profit organisation of the
same name that has an interest in the
development of responsive and good quality
railway passenger services;
“Community Rail Route” means any Route in respect of which the
Secretary of State determines that any relevant
Community Rail Partnership has an interest;
“Commuter Fare” means any:
(a) Weekly Season Ticket, Monthly Season
Ticket, Quarterly Season Ticket and
Annual Season Ticket (and their
equivalent ITSO products) between
each London Station and any other
such station or other station;
(b) unrestricted Single Fare and
unrestricted Return Fare (and their
equivalent ITSO products) between
each London Station; and
(c) unrestricted Single Fare and
unrestricted Return Fare (and their
equivalent ITSO products) from each
Suburban Station to each London
Station (but not in the other direction);
(d) PAYG Peak Fare or PAYG Off-Peak Fare
(and their equivalent ITSO products)
between each London Station and any
other such station (and if and when
CPAY is introduced the CPAY equivalent
Peak and Off Peak fares); and
(e) any Flexi Season Ticket that may be
offered for unlimited travel between
each London Station and any other
such station or other station but which
has restrictions on the permitted times
of use or the volume of travel allowed.
These restrictions may include
permitting travel only on fewer than
five days a week or outside Peak hours,
for which the Franchisee is entitled to be
allocated all or part of the revenue therefrom
pursuant to the Ticketing and Settlement
Agreement;
VERSION 12.2x FOIA 2000 PUBLIC REGISTER COPY
39
“Commuter Fares Basket” means the grouping of Commuter Fares:
(a) determined by the Secretary of State
pursuant to Schedule 5.3 (Allocation of
Fares to Fares Baskets);
(b) for the purposes of regulating
aggregate Prices or Child Prices, as the
case may be, in accordance with
Schedule 5.4 (Regulation of Fares
Basket Values);
(c) amended by the Secretary of State
from time to time in accordance with
Schedule 5.7 (Changes to Fares and
Fares Regulation); and
(d) set out in the Commuter Fares
Document;
“Commuter Fares
Document”
means:
(a) for the period commencing from the
Start Date until the Combined Effective
Date, the document in the agreed
terms marked CFD1;
(b) for the period commencing from the
Combined Effective Date until the end
of the Franchise Period, the document
in the agreed terms marked CFD2,
in each case, as the same may be amended
from time to time in accordance with Schedule
5.7 (Changes to Fares and Fares Regulation);
“Compulsory Inter-available
Flow”
has the meaning given to it in the Ticketing and
Settlement Agreement;
“Computer System” means computer hardware and computer
software, including licensed third party software
and data protocols;
“Condition L Compensation
Amounts”
has the meaning given to such term in
paragraph 7.5(e) of Schedule 6.2 (TSGN
Franchise Specific Provisions);
"Conditions Precedent
Agreement"
means the agreement between the Secretary of
State and the Franchisee of even date herewith
specifying certain conditions to be satisfied or
waived by the Secretary of Sta