SERVICE AGREEMENT
This Services Agreement (the "Agreement") is entered into by and between
American NET Claims, Inc., a Texas corporation ("ANC") and American Medical
Finance, Inc., a Texas corporation ("AMF").
Recitals
WHEREAS, ANC has been incorporated in 1996 and has developed a business
model for the purpose of acquiring, developing and marketing internet software
technology.
WHEREAS FURTHER, ANC has purchased (the "Purchase") all of the internet
software licenses, intellectual property rights, internet technology and
technology rights from AMF.
WHEREAS FURTHER, ANC plans to develop, test and market the asset purchased
from AMF.
WHEREAS FURTHER, ANC intends to raise funds via the Private Placement and
public offering markets, and will become self-sufficient at that time.
WHEREAS FURTHER, ANC does not have the staffing and other resources on
hand necessary to conduct certain of its activities with respect to the
continued development of the software technology.
WHEREAS FURTHER, AMF has the staffing and other resources on hand or
available to it, which allows it to coordinate the activities and the services
necessary and convenient relating to the needs of ANC.
WHEREAS FURTHER, ANC desires and has agreed to engage the services of AMF
under the terms and conditions as hereinafter expressed, and AMF has agreed to
have its services engaged by ANC under the terms and conditions as hereinafter
expressed.
WHEREAS FURTHER, this writing is intended to form the basis between ANC
and AMF of the agreements, terms, conditions and consideration for the services
to be rendered to and on behalf of each relative to the Purchase.
NOW, THEREFORE, for and in consideration of the mutual covenants as herein
contained and based on the foregoing, the parties hereto agree as follows:
1. Incorporation of Paragraphs. The above and foregoing Recital paragraphs are
substantive
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in nature and are hereby incorporated herein by reference as contractual
representations, warranties, duties and obligations of the parties hereto and
are meant to be, and are hereby deemed as being, integral parts to this
Agreement.
2. Employment of the Services of AMF as an Independent Contractor. The parties
to this Agreement hereby enter into this Agreement to employ the services of AMF
as an Independent Contractor for the purposes of performing management services
on behalf of ANC. AMF acknowledges that neither it, nor any of its employees
shall be deemed or become an employee of ANC. As such, AMF acknowledges and
agrees to comply with the laws of the United States and the State of Texas
concerning federal and state tax laws. AMF agrees to file all income tax returns
required of Independent Contractors and to pay all taxes owed, including but not
limited to periodic estimated income tax payments and 941 taxes relative to its
employees. AMF further agrees to indemnify and hold harmless ANC against any and
all claims arising from AMF's failure to pay any tax when due.
3. Services to be Provided. AMF shall provide the following services for the
benefit of ANC on an as needed basis:
a. Providing services relating to all prospective developmental,
marketing, operating, financial and acquisition contractual
agreements which lead to the implementation of ANC's business model
and drafting of such agreements, as needed;
b. Providing accounting and financial services relating to the
implementation of the business model of ANC;
c. Providing administrative, management, marketing, acquisition and
operational services relating to the business model of ANC, and in
general,
d. Providing the overall management of all activities relating to the
business model of ANC;
e. General coordination of the activities and services necessary and
convenient relating to the business model of ANC; and the
f. Labor necessary in order to achieve the services necessary and
convenient relating to the business model of ANC.
4. Responsibility for Proportionate Share of Overhead. The parties acknowledge
and agree that to deliver the services and achieve the goals of each and in
order to smoothly coordinate all of the management and other activities relating
to the Purchases, the parties will office together and will share the overhead
expenses related to such office sharing. "Exhibit A", attached hereto,
represents the current costs to be incorporated into this agreement. Costs on
"Exhibit A" are subject to revision after each six (6) month period. AMF will
notify ANC of the new
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charges, accordingly.
5. Consideration. The consideration for this Agreement shall be deemed the
services rendered by AMF to ANC and the compensation paid by ANC to AMF and the
sharing of the overhead and office space as described above.
6. Payments Under this Agreement. The parties mutually acknowledge and agree
that each month, there shall be a calculation of the services rendered by AMF to
ANC related to this Agreement (the "Monthly Statement"). The Monthly Statement
shall be prepared by AMF and submitted to ANC. The Monthly Statement shall
detail among other things, the amounts owed to AMF for services rendered and
expenses incurred that previous month. If any amounts or items with respect to
the Monthly Statement are contested by either party to this Agreement, such
dispute shall be handled in accordance with the other terms and conditions of
this Agreement relating to the settlement of disputes. As needed, the charged
amount on the monthly statement may be added to the Line of Credit Agreement
between ANC and AMF, dated July 31, 1996.
7. At Will Agreement. This Agreement shall be deemed to be an "at will"
agreement and either party may cancel this Agreement by giving the other written
notice of the intent to cancel. Cancellation shall be effective as is set out in
the written notice of the intent to cancel.
8. Control of Activities. The parties mutually acknowledge and agree that ANC
shall not control the activities of AMF, its handling of its employees,
negotiation strategies, hours of work or any other matters relative to the
services to be provided by AMF to ANC. Notwithstanding the foregoing, ANC shall
be permitted to dictate to AMF the parameters within which AMF must work.
9. Authority to Bind. Nothing in this Agreement shall be construed to constitute
AMF as the partner, employee, representative or direct agent of ANC, nor shall
Contractor have any authority to bind ANC in any respect, it being intended that
AMF shall be and remain an Independent Contractor responsible only for its own
actions, and subject to the terms herein. AMF shall not, without ANC's prior
written approval make representations or guarantees concerning any of the
Purchases.
10. Settlement of Disputes. The following Agreements are made:
a. If a dispute arises out of or relates to this Agreement, including to
mean any of its Exhibits, or the breach or default of this Agreement, the
parties shall first, in good faith, attempt to negotiate a settlement of
that dispute, breach or default.
b. If the dispute, breach or default cannot be settled through
negotiation, the parties agree and shall proceed to binding arbitration,
through the American Arbitration Association in Dallas, Texas, in
accordance with its Commercial Arbitration Rules and judgment upon the
award rendered by the arbitrator(s) may be entered in any court having
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jurisdiction thereof.
c. Any provisional remedy (including injunctive relief and the appointment
of a receiver) which a party to this Agreement may want to elect, shall be
available notwithstanding the provisions relating to arbitration of
disputes. Any party may seek such provisional remedy from the appropriate
court of law pending arbitration, and such proceeding in which the
provisional remedy was sought will then be stayed pending the final award
of the arbitration.
d. The expenses of arbitration conducted pursuant to this paragraph shall
be born by the parties in such proportions as the arbitrator(s) shall
decide.
11. Notices. All notices, demands, requests and other communications required or
permitted hereunder, or under any other Loan Document except as otherwise
provided therein, shall be in writing and shall be deemed to be given and
delivered (except where actual receipt is specified herein or in any other Loan
Document), upon actual receipt by personal delivery, receipt of notice via
overnight delivery, second day delivery, registered mail, or certified mail,
postage fully prepaid, return receipt requested, addressed to either party, as
the case may be, at its address or at such other address as such party may have
specified theretofore by notice delivered in accordance with this Article.
Rejection or other refusal to accept or the inability to deliver because of
changed address of which no notice thereof was given shall be deemed to be
receipt of the notice, demand, request or other communication.
12. Successors and Assigns. This Agreement shall be binding upon ANC and AMF and
their respective successors, and assigns and shall inure to the benefit of ANC
and AMF and their respective successors, and assigns; provided that AMF shall
not assign any of its rights, duties or obligations hereunder without the prior
written consent of ANC.
13. Severability Clause. Should any provision hereof be deemed illegal or
unenforceable, then any other provisions hereof shall be given effect separately
therefrom and shall not be affected thereby.
14. Amendments; Governing Law. This Agreement and the rights and obligations of
the parties hereunder (i) may be changed only by an instrument in writing signed
by ANC and AMF and (ii) shall be construed in accordance with and governed by
the laws of the state of Texas.
15. Further Assurances. The parties to this Agreement mutually, both
individually and collectively, covenant and agree that they will do any and all
things reasonably necessary after the date of this Agreement in order to
effectuate all the terms and conditions of this Agreement. Each party agrees to
cooperate with the other including but not limited to signing any and all
documents necessary in order to effectuate the other terms and conditions of
this Agreement.
16. Counterpart Execution. This Agreement may be executed in several
counterparts, each of
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which shall be fully effective as an original and all of which together shall
constitute one and the same instrument.
17. Facsimile Execution. The parties hereby agree that a facsimile copy of this
Agreement will be deemed an original for all purposes, and each hereby waives
the necessity of providing the original copy of this Agreement to bind the
other.
18. Headings. Article, section and/or subsection headings used in this Agreement
are for convenience of reference only and shall not affect the construction or
interpretation of this Agreement.
19. Waiver. No delay or omission to exercise any right, power of remedy accruing
to any party hereto shall impair any such right, power or remedy of such party
nor shall it be construed to be a waiver of any such right, power or remedy nor
constitute any course of dealing or performance hereunder. No waiver shall be
effective unless it is in writing and is received by the waiving party.
20. Attorney's Fees. If any action, suit or other proceeding is instituted
concerning or arising out of this Agreement, the prevailing party shall recover
from the non-prevailing party all of such party's costs, any attorney's fees
incurred in each and every action, suit or other proceeding, including any and
all appeals or petitions therefrom. As used herein, "prevailing party" shall
mean the party entitled to recover its cost of such action, suit or proceeding,
whether or not the suit proceeds to final judgment.
21. Incorporation of Exhibits and Schedules. Any and all Exhibits and Schedules
to this Agreement shall be deemed to be part of this Agreement and are hereby
intended to be incorporated herein by reference as if set out verbatim.
22. References. All references to "Article" contained herein are, unless
specifically indicated otherwise, references to sections of this Agreement.
Whenever herein the singular number is used, the same shall include the plural
where appropriate, and words of any gender shall include each other gender where
appropriate.
23. Performance. Performance under the terms and conditions of this Agreement
has and will take place in Dallas, Texas.
24. Representations to Survive this Agreement. The representations, warranties
and covenants of the Provider contained herein shall survive the purchase of the
Purchased Accounts Receivable and the termination of this Agreement.
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IN WITNESS WHEREOF, AMF and ANC have caused this Agreement to be duly
executed on the 5th day of August, 1997.
AMF:
By: /s/ C. Xxxxx Xxxxxxxx
----------------------------------
C. Xxxxx Xxxxxxxx, VP & CFO
ANC:
By: /s/ Xx X. Xxxxx
----------------------------------
Xx X. Xxxxx, President
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EXHIBIT A
Indirect Costs:
Auto $ 80
Advertising (newspaper recruiting ads) 300
Equipment rental (furniture & fixtures, computers & software, etc.) 5,000
Employee insurance benefits 1,100
Employer FICA/Medicare 900
FUTA/SUTA 300
Meals 300
Express mail 200
Hotel 600
Office 150
Rent 2,000
Salaries (1/2 of 5 admin. salaries) 11,500
Telephone 1,300
Travel 3,000
Dues & subscriptions 20
Office equipment rental (photo copiers, postage meter 200
machines)
Office supplies 600
Postage 100
Printing (letterhead, Bus cards, marketing brochures, etc. 500
--------
Total Indirect Costs $ 28,150
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Direct costs:
Computer supplies $ 200
Meals 100
Hotel 50
Travel 100
Outside professional consultants 1,000
Market testing & research 2,500
Office supplies 150
Telephone 2,800
Travel 100
Salaries (9 employees) 25,600
Employer FICA/Medicare 2,000
Employee insurance benefits 2,400
--------
Total Direct Costs $ 37,000
--------
Total monthly charge to ANC $ 65,150
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