EXHIBIT 10(a)
PR EXPENSE FUNDS ADMINISTRATION AGREEMENT
This Administration Agreement ("Agreement") is entered into effective on
the 9th day of July, 1997 ("Effective Date"), by and between COMPUTERIZED
THERMAL IMAGING, INC., a Nevada corporation ("CTI"), LIBERTY CAPITAL GROUP,
INC., a Washington corporation ("Liberty"), and Manhattan Financial Group
("Administrator").
W I T N E S S E T H:
WHEREAS, CTI and Liberty entered into an agreement on the Effective Date
wherein Liberty has agreed to provide public relations services to CTI (the
"Public Relations Agreement"); and
WHEREAS, the terms and conditions of the Public Relations Agreement
provide for the establishment of an account from which approved expenses of
Liberty incurred in the performance of public relations services will be
paid; and
WHEREAS, CTI is required to fund the account pursuant to the terms and
conditions of the Public Relations Agreement; and
WHEREAS, CTI and Liberty desire to appoint the Administrator to be
solely responsible for the receipt and handling of invoices, confirmation of
proper purpose for the expenses, and disbursement of funds with regard to
such account;
NOW THEREFORE, and in consideration of the premises and covenants
hereinafter contained, the parties do hereby agree as follows:
1. APPOINTMENT AND ACCEPTANCE. CTI and Liberty hereby appoint and
authorize the Administrator to set up and administer an account pursuant to
the Public Relations Agreement (the "Account"). The Administrator hereby
accepts such appointment and agrees to take all necessary action to maintain
the Account in accordance with the terms of this Agreement, including the
acceptance, handling and disbursement of deposited funds.
2. DELIVERY OF THE FUNDS. Liberty agrees to accept payment (or
reimbursement) for its incurred fees and expenses on the terms set forth in
this paragraph 2, which amends and supersedes the installment provisions set
forth in the Public Relations Agreement. CTI shall deposit, or have deposited
on its behalf, an aggregate amount of up to $150,000.00 (the "Funds") into
the Account as needed to satisfy the requirements for payment of fees and
expenses under the Public Relations Agreement.
At least monthly, the Administrator shall facilitate CTI's requirement
to deposit into the Account such amount as is necessary to pay the sum of all
approved expenses incurred or to be incurred or paid by Liberty for the
invoice period. Liberty shall submit a proper invoice to the Administrator in
advance of payment when possible, or for immediate reimbursement or payment
of such expense incurred, but not to exceed five (5) business days for
acceptance of the invoice. Said invoice shall include: explanation of service
performed and classification of the persons performing this service and the
method of calculating the fee; detail for expenses incurred identifying the
item and purpose for which the expense is incurred; cost method for
calculation of expense; and detail of expenses incurred for prior billing
periods with any adjustments required if payments have been made on budgets
in prior months. Faxed copies of invoices shall be sufficient. Some billing
periods may include invoices for expenses from prior months, such as
telephone companies, internet services, advertising services, but the
Administrator shall receive invoicing copies within sixty (60) days for
payment of any expense.
Liberty may submit a monthly budget to the Administrator estimating
costs to be incurred, and the Administrator shall review and discuss the
budget with Liberty and make such adjustments as the Administrator deems
advisable, approving the remaining budget for payment. If the Administrator
has approved any budget, all of those
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expenses shall be deemed approved and paid when incurred or in advance. If
payment is made in advance, Liberty shall provide invoices upon performance
of services or receipt of invoices for expenses.
Liberty shall include in a monthly expense budget an estimate of travel
related expenses to be incurred for a maximum of $5,000.00 per month, subject
to approval by the Administrator (with counsel from CTI management). Liberty
shall detail any services which its employee(s) will charge based on hourly
salary wages or contracts set forth in the budget. The budget may estimate
telephone charges at the rate of 12CENTS per minute, subject to adjustment
when actual telephone bills are received and submitted to the Administrator.
Adjustments may be recovered or added to subsequent months budget advance
payments. Mailing costs will be budgeted at $500.00 per month, but Liberty
shall submit to the Administrator actual mailing costs in subsequent months
budget for reimbursement or adjustment. Liberty will xxxx for services data
entry at the rate of $10.00 per hour if performed by Liberty. All other
miscellaneous expenses shall be billed upon receipt and verification of
invoices. All reasonable expenses will be paid by the Administrator, but the
Administrator has the discretion to review and approve all expenses in
advance. Once the Administrator has approved the budget, the expenses will be
deemed approved, even though the actual expenditure may vary reasonably from
the budgeted expense amount. Any reimbursement fee expense not approved by
the Administrator shall be subject to the Administrator's reasonable
approval. An expense shall be deemed approved when the Administrator provides
written confirmation or signs an invoice.
The parties anticipate that most expenses will be set forth on budgets
in advance, against which the Administrator will make payment. Expenses may
not exceed the $150,000.00 cap without the approval of the Administrator. CTI
recognizes that it may request extra, unanticipated costs or unanticipated
printing levels which may require expenditures to exceed the $150,000.00 cap
account, but Liberty may not incur expenses under the Public Relations
Agreement (including all services, expenses, printing, and advertising)
without the approval of the Administrator.
It is expressly understood that the intent of this Agreement is to
facilitate the work of Liberty in its completion of the Public Relations
Agreement. It is in the best interest of CTI to permit Liberty to execute its
campaign as it deems professionally advisable and for the Administrator to
facilitate the effectiveness of Liberty by making the Funds readily available
and promptly paid. The spirit of this Agreement is that Liberty will do its
best to conserve the Funds and that it will work within the budget approved
by CTI.
3. ADMINISTRATOR'S RIGHTS AND DUTIES.
(a) The Administrator is hereby authorized to use the Funds to pay
those costs and expenses incurred or to be incurred by Liberty in the
performance of services pursuant to the Public Relations Agreement and which
are approved by the Administrator (in amount or estimated amount) prior to
being incurred ("Approved Expenses"). All other expenses submitted by
Liberty, but not approved in advance, shall be reimbursed from the Funds at
the sole discretion of the Administrator. All requests for reimbursement of
expenses shall be in writing and supported by relevant documentation. The
Administrator is further authorized to withdraw from the Funds any amounts
required to satisfy the costs and expenses associated with the regular
maintenance of the Account, but is not authorized to withdraw any other
amounts for the benefit of CTI not requested by Liberty.
(b) The Administrator shall be protected and not subject to claims
in acting upon any written notice, request, waiver, consent, certificate,
receipt, authorization, or other paper or document which the Administrator
believes to be genuine and what it purports to be.
(c) The Administrator may confer with legal counsel in the event
of any dispute or question as to the construction of any of the provisions
hereof, or its duties hereunder, and it shall incur no liability and it shall
be fully protected in acting in accordance with the opinions of such counsel.
CTI shall pay all such legal fees incurred.
(d) The Administrator shall not be liable for anything which it
may do or refrain from doing in connection with this Agreement, including the
exercise of discretion in approving requests for expenditures, except for its
own gross negligence or willful misconduct. The parties hereto agree to
indemnify the Administrator for, and to hold it harmless against, any loss,
liability or expense (including, without limitation, reasonable attorney's
fees)
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incurred by it without gross negligence or willful misconduct on its part
arising out of or in connection with its entering into this Agreement and the
carrying out of its duties hereunder.
(e) The Administrator may resign for any reason, upon thirty (30)
days written notice to the parties to the Agreement. Upon expiration of such
thirty (30) days notice period, the Administrator may deliver all cash or
property in its possession under this Agreement to any successor
Administrator appointed by the other parties hereto, or if no successor
Administrator has been appointed, to Liberty. Upon either such deliver,
Administrator shall be released from any and all liability under this
Agreement.
4. LIBERTY'S RIGHTS. If Administrator fails to pay expenses needed by
Liberty to perform the Public Relations Agreement after approval and delivery
of proper documentation to Administrator, Liberty's recourse shall be against
CTI, not against the Administrator. If failure to pay expenses for Liberty
prevents its reasonable performance of the Public Relations Agreement,
Liberty shall be entitled to delay its performance until the Funds necessary
are made available.
5. EVENTS OF TERMINATION. The Administrator shall distribute the Funds
remaining in the Account, as provided for in Section 5, upon the occurrence
of any of the following events: (i) receipt of written notice from CTI and
Liberty advising the Administrator that the Public Relations Agreement has
been terminated; (ii) receipt of written instructions from CTI and Liberty
directing the Administrator to close the Account; or (iii) the Account has
not been closed by July 16, 1998. This Agreement shall terminate and the
Administrator shall be discharged of all responsibility hereunder at such
time as the Administrator shall have distributed any Funds remaining in the
Account upon such events and completed its duties hereunder. Liberty shall
have thirty (30) days within which to summarize and submit all unpaid
expenses to the Administrator.
6. ALLOCATION OF REMAINING FUNDS. Upon the occurrence of any of the
events described in Section 5, the Administrator shall distribute the Funds
in accordance with this Section 6. All approved expenses will be paid by
Administrator within five (5) business days of receipt of closing invoices.
Any Funds remaining after payment of approved expenses shall be distributed
according to the joint instructions, or if there are no joint instructions,
the Administrator shall distribute the first $10,000 plus 50% of any amount
in excess of $10,000 of the Funds remaining in the Account to the
Administrator as compensation for services provided under this Agreement. The
balance of the Funds remaining in the Account shall be delivered to CTI.
7. GOVERNING LAW. This Agreement shall be construed and enforced in
accordance with the laws of the state of Washington, without regard to any
conflicts of laws provisions thereof.
8. ALTERNATIVE DISPUTE RESOLUTION. Any controversy or claim arising
out of or relating to this Agreement, or the breach, termination, or validity
thereof, shall be settled by final and binding arbitration in accordance with
the Commercial Arbitration Rules of the American Arbitration Association
("AAA Rules") in effect as of the Effective Date of this Agreement. The
American Arbitration Association ("AAA") shall be responsible for (i)
appointing a sole arbitrator, and (ii) administering the case in accordance
with the AAA Rules. The situs of the arbitration shall be Seattle,
Washington. Any order or judgement rendered by the arbitrator may be entered
by any court having jurisdiction.
9. NOTICE. Any notice required or permitted hereunder shall be in
writing and shall be sufficiently given if personally delivered, transmitted
via confirmed telecopy or mailed by certified or registered mail, return
receipt requested, addressed as follows:
If to CTI: Xxxxx X. Xxxxxxxx
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxx, Xxxxxx 00000
(000) 000-0000 Telecopier
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If to Liberty: Xxx Xxxxx Xxxxx
000 Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
(000) 000-0000 Telecopier
If to the Administrator: Xxx Xxxxxx
0000 Xxxxxxxxx Xxxxxx, #000
Xxxxxxxxx Xxxxx, Xxxxxxxxxx 00000
(000) 000-0000 Telecopier
(or to such other address as may be stated in written notice furnished by any
party to the other party), and shall be deemed to have been delivered as of
the date so personally delivered or mailed.
10. DUPLICATE ORIGINALS. This Agreement may be executed in one or more
counterparts, each of which shall be treated and deemed an original, but all
of which together shall constitute one and the same document.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed this 9th day of July, 1997.
COMPUTERIZED THERMAL IMAGING, INC.
By: /s/ Xxxxx X. Xxxxxxxx
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Name: Xxxxx X. Xxxxxxxx, Chief Executive Officer
LIBERTY CAPITAL GROUP, INC.
By: /s/ Xxx Xxxxx Xxxxx
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Name: Xxx Xxxxx Xxxxx
Title: President
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ADMINISTRATOR
By: /s/ Xxxxx Xxxxxx
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Xxxxx Xxxxxx
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