Exhibit 10
ADMINISTRATIVE SERVICES AGREEMENT
THIS ADMINISTRATIVE SERVICES AGREEMENT, dated as of May 1, 2003, is
between PIF/CORNERSTONE MINISTRIES INVESTMENTS, INC., a Georgia corporation (the
"Company"), and CORNERSTONE CAPITAL ADVISORS, INC., a Georgia corporation (the
"Service Provider").
W I T N E S E T H
WHEREAS, the Company desires to avail itself of the experience, sources
of information, advice, assistance and certain facilities available to the
Service Provider and to have the Service Provider undertake the duties and
responsibilities hereinafter set forth, on behalf of, and subject to the
supervision of, the Board of Directors of the Company all as provided herein;
and
WHEREAS, the Service Provider is willing to undertake to render such
services, subject to the supervision of the Board of Directors, on the terms and
conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements contained herein, the parties hereto agree as follows:
Definitions. As used in this Administrative Services Agreement (the
"Agreement"), the following terms have the definitions hereinafter indicated:
Service Provider. Cornerstone Capital Advisors, Inc., a Georgia
corporation, any successor Service Provider to the Company, or any person or
entity to which Cornerstone Capital Advisors, Inc. or any successor Service
Provider subcontracts substantially all of its functions.
Affiliate or Affiliated. As to any individual, corporation,
partnership, trust or other association, (i) any Person or entity directly or
indirectly; through one or more intermediaries controlling, controlled by, or
under common control with another person or entity; (ii) any Person or entity,
directly or indirectly owning or controlling ten percent (10%) or more of the
outstanding voting securities of another Person or entity; (iii) any officer,
director, partner, or trustee of such Person or entity; (iv) any Person ten
percent (10%) or more of whose outstanding voting securities are directly or
indirectly owned, controlled, or held, with power to vote, by such other Person;
and (v) if such other Person or entity is an officer, director, partner, or
trustee of a Person or entity, the Person or entity for which such Person or
entity acts in any such capacity.
Articles of Incorporation. The Articles of Incorporation of the
Company, as amended from time to time.
Board of Directors or Board. The persons holding such office, as of any
particular time, under the Articles of Incorporation of the Company, whether
they be the Directors named therein or additional or successor Directors.
Bylaws. The bylaws of the Company, as the same are in effect from time
to time.
Cause. With respect to the termination of this Agreement, fraud,
criminal conduct, willful misconduct or willful or negligent breach of fiduciary
duty by the Service Provider or breach of this Agreement.
Company. PIF/Cornerstone Ministries Investments, Inc., a corporation
organized under the laws of the State of Georgia.
Director. A member of the Board of Directors of the Company.
Good Reason. With respect to the termination of this Agreement, (i) any
failure to obtain a satisfactory agreement from any successor to the Company to
assume and agree to perform the Company's obligations under this Agreement; or
(ii) any material breach of this Agreement of any nature whatsoever by the
Company.
Independent Director. With respect to a matter to be considered by the
Board, a Director who, with respect to a director's conflicting interest
transaction, any Director who does not have either (1) a conflicting interest
respecting the transaction or (2) a familial, financial, professional, or
employment relationship with a second director who does have a conflicting
interest respecting the transaction, which relationship would, in the
circumstances, reasonably be expected to exert an influence on the first
director's judgment when voting on the transaction. A "conflicting interest"
shall have the meaning set forth in Section 14-2-860 of the Georgia Business
Corporation Code, as amended.
Person. An individual, corporation, partnership, estate, trust
(including a trust qualified under Section 401(a) or 501(c) (17) of the Code), a
portion of a trust permanently set aside for or to be used exclusively for the
purposes described in Section 642(c) of the Code, association, private
foundation within the meaning of Section 509(a) of the Code, joint stock company
or other entity, or any government or any agency or political subdivision
thereof.
PIF/Cornerstone. PIF/Cornerstone Ministries Investments, Inc., a
Georgia corporation. Termination Date. The date of termination of the Agreement.
Appointment. The Company hereby appoints the Service Provider to serve
as its Service Provider on the terms and conditions set forth in this Agreement,
and the Service Provider hereby accepts such appointment. The Service Provider
undertakes to use its best efforts to provide administrative and "back-office"
services as the Service Provider and the Company may from time to time agree,
subject in each case to the direction and supervision of the Company. The
initial administrative services to be performed by Service Provider are set
forth on Exhibit A hereto.
Records; Access. The Service Provider shall maintain appropriate
records of all its activities hereunder and make such records available for
inspection by the Board and by counsel, auditors and authorized agents of the
Company, at any time or from time to time during normal business hours. The
Service Provider shall at all reasonable times have access to the books and
records of the Company.
Relationship with Directors. Directors, officers and employees of the
Service Provider or an Affiliate of the Service Provider or any corporate
parents of an Affiliate, or directors, officers or stockholders of any director,
officer or corporate parent of an Affiliate may serve as a Director and as
officers of the Company, except that no director, officer or employee of the
Service Provider or its Affiliates who also is a Director or officer of the
Company shall receive any compensation from the Company for serving as a
Director or officer other than reasonable reimbursement for travel and related
expenses incurred in attending meetings of the Board.
Fees. The Service Provider is not entitled to a set, periodic
management fee for its services rendered hereunder, but is entitled to expense
reimbursement, as described in Paragraph 6 below. However, the Company will
consider adopting an incentive compensation plan for Service Provider under
which the Service Provider would receive incentive compensation for good
performance.
Expenses. In addition to the compensation paid to the Service Provider
pursuant to Paragraph 5 hereof, the Company shall pay directly or reimburse the
Service Provider for all of the reasonable expenses paid or incurred by the
Service Provider in connection with the services it provides to the Company
pursuant to this Agreement.
Section 1.01 Expenses incurred by the Service Provider on behalf of the Company
and payable pursuant to this Paragraph 6 shall be reimbursed monthly to the
Service Provider on or before the 15th day of month immediately following the
month in which the expenses were incurred. The Service Provider shall prepare a
statement documenting the expenses of the Company during each quarter, and shall
deliver such statement to the Company within 45 days after the end of each
quarter.
Section 1.02 The allocation of Service Provider's personnel expenses and
overhead to the Company shall be based upon a good faith estimate of the amount
of time spent by such personnel on Company-related business.
Other Services. Should the Board request that the Service Provider or
any director, officer or employee thereof render services for the Company other
than set forth in Paragraph 3, such services shall be separately compensated at
such rates and in such amounts as are agreed by the Service Provider and the
Independent Directors of the Company, subject to the limitations contained in
the Articles of Incorporation, and shall not be deemed to be services pursuant
to the terms of this Agreement.
Other Activities of the Service Provider. Nothing herein contained
shall prevent the Service Provider from engaging in other activities, including,
without limitation, the rendering of services and/or advice to other Persons
(including PIF/Cornerstone).
Relationship of Service Provider and Company. The Company and the
Service Provider are not partners or joint venturers with each other, and
nothing in this Agreement shall be construed to make them such partners or joint
venturers or impose any liability as such on either of them.
Term; Termination of Agreement. This Agreement shall continue in force
until December 31, 2003, subject to an unlimited number of successive one-year
renewals upon mutual consent of the parties. It is the duty of the Board to
evaluate the performance of the Service Provider annually before renewing the
Agreement, and each such renewal shall be for a term of no more than one year.
Termination by Either Party. This Agreement may be terminated upon 60
days written notice without Cause or penalty, by either party (upon approval of
a majority of the Independent Directors of the Company or a majority of the
Board of Directors of the Service Provider, as the case may be).
Assignment to an Affiliate. This Agreement may be assigned by the
Service Provider to an Affiliate with the approval of a majority of the Board of
the Company (including a majority of the Independent Directors). The Service
Provider may assign any rights to receive fees or other payments under this
Agreement without obtaining the approval of the Board. This Agreement shall not
be assigned by the Company without the consent of the Service Provider, except
in the case of an assignment by the Company to a corporation or other
organization which is a successor to all of the assets, rights and obligations
of the Company, in which case such successor organization shall be bound
hereunder and by the terms of said assignment in the same manner as the Company
is bound by this Agreement.
Payments to and Duties of Service Provider upon Termination.
Section 1.01 After the Termination Date, the Service Provider shall not be
entitled to compensation for further services hereunder except it shall be
entitled to receive from the Company within 30 days after the effective date of
such termination all unpaid reimbursements of expenses and all earned but unpaid
fees payable to the Service Provider prior to termination of this Agreement.
Section 1.02 The Service Provider shall promptly upon termination:
02.1 pay over to the Company all money collected and held for the
account of the Company pursuant to this Agreement, after deducting any accrued
compensation and reimbursement for its expenses to which it is then entitled;
02.2 deliver to the Board a full accounting, including a statement
showing all payments collected by it and a statement of all money held by it,
covering the period following the date of the last accounting furnished to the
Board;
02.3 deliver to the Board all assets, including Properties, and
documents of the Company then in the custody of the Service Provider; and
02.4 cooperate with the Company to provide an orderly transition.
Indemnification by the Company. The Company shall indemnify and hold
harmless the Service Provider and its Affiliates, including their respective
officers, directors, partners and employees, from all liability, claims, damages
or losses arising in the performance of their duties hereunder, and related
expenses, including reasonable attorneys' fees, to the extent such liability,
claims, damages or losses and related expenses are not fully reimbursed by
insurance, subject to any limitations imposed by the laws of the State of
Georgia or the Articles of Incorporation of the Company. Notwithstanding the
foregoing, the Service Provider shall not be entitled to indemnification or be
held harmless pursuant to this Paragraph 14 for any activity which the Service
Provider shall be required to indemnify or hold harmless the Company pursuant to
Paragraph 15.
Indemnification by Service Provider. The Service Provider shall
indemnify and hold harmless the Company from contract or other liability,
claims, damages, taxes or losses and related expenses including attorneys' fees,
to the extent that such liability, claims, damages, taxes or losses and related
expenses are not fully reimbursed by insurance and are incurred by reason of the
Service Provider's bad faith, fraud, willful misfeasance, misconduct, negligence
or reckless disregard of its duties, but the Service Provider shall not be held
responsible for any action of the Board of Directors in following or declining
to follow any advice or recommendation given by the Service Provider.
Notices. Any notice, report or other communication required or
permitted to be given hereunder shall be in writing unless some other method of
giving such notice, report or other communication is required by the Articles of
Incorporation, the Bylaws, or accepted by the party to whom it is given, and
shall be given by being delivered by hand or by overnight mail or other
overnight delivery service to the addresses set forth herein:
To the Board and to the Company: PIF/Cornerstone Ministries Investments, Inc.
0000 Xxxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000-0000
To the Service Provider: Cornerstone Capital Advisors, Inc.
0000 Xxxxxxxxxx Xxxx, Xxxxx 000,
Xxxxxxx, Xxxxxxx 00000-0000
Either party may at any time give notice in writing to the other party
of a change in its address for the purposes of this Paragraph 16.
Modification. This Agreement shall not be changed, modified,
terminated, or discharged, in whole or in part, except by an instrument in
writing signed by both parties hereto, or their respective successors or
assignees.
Severability. The provisions of this Agreement are independent of and
severable from each other, and no provision shall be affected or rendered
invalid or unenforceable by virtue of the fact that for any reason any other or
others of them may be invalid or unenforceable in whole or in part.
Construction. The provisions of this Agreement shall be construed and
interpreted in accordance with the laws of the State of Georgia.
Entire Agreement. This Agreement contains the entire agreement and
understanding among the parties hereto with respect to the subject matter
hereof, and supersedes all prior and contemporaneous agreements, understandings,
inducements and conditions, express or implied, oral or written, of any nature
whatsoever with respect to the subject matter hereof. The express terms hereof
control and supersede any course of performance and/or usage of the trade
inconsistent with any of the terms hereof. This Agreement may not be modified or
amended other than by an agreement in writing.
Indulgences, not Waivers. Neither the failure nor any delay on the part
of a party to exercise any right, remedy, power or privilege under this
Agreement shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, remedy, power or privilege preclude any other or further
exercise of the same or of any other right, remedy, power or privilege, nor
shall any waiver of any right, remedy, power or privilege with respect to any
occurrence be construed as a waiver of such right, remedy, power or privilege
with respect to any other occurrence. No waiver shall be effective unless it is
in writing and is signed by the party asserted to have granted such waiver.
Gender. Words used herein regardless of the number and gender
specifically used, shall be deemed and construed to include any other number,
singular or plural, and any other gender, masculine, feminine or neuter, as the
context requires.
Titles not to Affect Interpretation. The titles of paragraphs and
subparagraphs contained in this Agreement are for convenience only, and they
neither form a part of this Agreement nor are they to be used in the
construction or interpretation hereof.
Execution in Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original as against any
party whose signature appears thereon, and all of which shall together
constitute one and the same instrument. This Agreement shall become binding when
one or more counterparts hereof, individually or taken together, shall bear the
signatures of all of the parties reflected hereon as the signatories.
[Signatures appear on next page.]
IN WITNESS WHEREOF, the parties hereto have executed this
Administrative Services Agreement as of the date and year first above written.
PIF/CORNERSTONE MINISTRIES
INVESTMENTS, INC.
By:
Name:
Title:
CORNERSTONE CAPITAL ADVISORS, INC.
By:
Name:
Title:
Exhibit A
List of Administrative Services
1. Loan administration, including supervision of application and closing
process and loan accounting.
2. Investor relations and the calculation of interest and dividends
payable to investors.
3. Marketing collateral.
4. Administration of computers, computer networks and management
information systems.
5. Photo-copying.
6. Maintenance of records, record keeping, book-keeping/accounting.
