ADMINISTRATIVE SERVICES AGREEMENT
Exhibit
10.1
This
Administrative Services Agreement (the “Agreement”) is effective as of the __day
of ____, 20__ (the “Effective Date”) by and between EPGI/FIRECREEK INC, a Nevada
corporation (the “Client”), and STRATEGIC PARTNERS LLC. a
Georgia limited liability company (“SPC”).
Factual
Background
A. The
Client is an existing business which recently underwent a fundamental change by
way of triangular reverse merger with M3 Lighting, Inc. a Georgia
corporation.
B. The
Client believes that it may be more efficient to “outsource” certain
administrative, management and technology support related functions, thereby
providing the Client with access to higher quality and more sophisticated level
of support at a lower cost because of the ability to “share” the cost with other
customers of the “outsource” provider. Of course, the Client,
desiring to be a stand-alone business, will retain other administrative and
management functions “in-house” where it is necessary for the “core business”
and is more cost effective or is otherwise more desirable.
NOW,
THEREFORE, the parties hereto agree as follows:
1. Management and Technology
Services.
(a) Engagement. The
Client hereby engages SPC to provide the following services:
(i) Financial and Accounting
Matters. SPC shall maintain Client’s general ledger, accounts
receivable and accounts payable records, and fixed asset records and provide
billing and collection services. SPC shall also prepare or cause to
be prepared Client’s federal, state and local tax returns, and financial
statements. SPC shall also provide, or cause to be provided, to
Client payroll services, including assistance with regulatory compliance
matters. SPC shall maintain all past accounting, tax and payroll
records until such time as such records shall be disposed of in accordance with
applicable legal requirements and SPC’s normal record disposal
policies.
(ii) Insurance
Matters. SPC shall provide or cause to be provided to Client
insurance with the coverage, insurers, and maximum deductibles shall be
determined by the parties. All such insurance policies shall add
Client as an additional named insured and such insurers shall be required to
provide Client with no less than 5 days prior written notice of any change or
cancellation of any such insurance. In the event of any such
potential change which may have a materially adverse affect on the Client, or in
the event of potential cancellation, Client shall be entitled to secure
replacement insurance at its own cost. All such insurance shall be at Client’s
sole cost and expense. Subscription to such insurance shall be at the option of
the client.
(iii) Employee Benefits
Matters. SPC shall provide or cause to be provided
administrative services necessary to the provision and maintenance of customary
employee benefits, including without limitation the Client’s 401(k) Plan,
medical, dental, vision, and life insurance programs, and stock option plan, and
to the extent feasible, will permit the employees of the Client to participate
in SPC’s 401(k), insurance and stock option plans. All such insurance shall be
at Client’s sole cost and expense.
(iv) Legal
Services. SPC shall provide Client with all legal services
reasonably requested by Client which SPC in-house counsel currently provides to
SPC in the ordinary course of business.
(v) Management Consulting and
Other Services Provided by SPC. SPC shall provide and perform
such other management consulting services, as shall be requested by the Client
and agreed upon between the Client and SPC, from time to time as
agreed.
(b) Compensation. For services
described in subsections above (the “Administrative Services”), SPC shall be
compensated at a minimum annual rate of Two Hundred and Fifty Thousand Dollars
($250,000) (the “Base Rate”) payable in monthly installments commencing
on the date of the closing of the EPGI/Firecreek/M3 merger, with such
commencement being made effective based on closure of an acquisition by M3
of size and substance to facilitate the base rate herein. The Base Rate shall
increase proportionally to increases in revenues, whether by acquisition or by
internal growth. The Base Rate increase will be reviewed with the Client,
and agreed to prior to any increase taking affect.
2.
Term. The
term of this Agreement shall be ten (10) years from the date hereof, provided
that the term shall thereafter automatically renew from time to time for
successive, additional ten-year terms unless either party shall provide the
other party with a written notice of termination at least six (6) months prior
to the termination date (including any termination date as a result of any
renewal period).
3.
Billing. SPC shall
xxxx the Client, on a monthly basis, a fee reflecting compensation due for
services rendered in the preceding month calculated as provided for in this
Agreement. The xxxx shall be due and payable upon
receipt.
4.
Separate Identity of
Client. The Client desires to remain at all times a separate
company. Toward that end, all business records, reports and files
prepared or maintained by SPC for the Client shall remain the sole and exclusive
property and records of the Client and the Client shall be entitled to their
return at any time upon request. Moreover, all of the Client’s funds,
accounts receivable or other property shall at all times be clearly and
distinctly maintained as the Client’s separate and distinct property and shall
not be combined or commingled with the property of SPC. Moreover, SPC
shall have no authority hereunder to enter into contracts on behalf of, or
otherwise legally bind, the Client. Although SPC shall make
recommendations to the Client hereunder, all decisions whether to accept or
reject the advice of SPC are up to the Client’s total discretion.
5.
Confidentiality. The
parties agree, both during the Term of this Agreement and for a period of two
years after termination of this Agreement, but in no event less than ten (10)
years from the Effective Date, to hold each other’s Proprietary or Confidential
Information in strict confidence. The parties agree not to make each
other’s Proprietary or Confidential Information available in any form to any
third party or to use each other’s Proprietary or Confidential Information for
any purpose, other than the implementation of and as specified in this Agreement
and other than use by Client in its business. Each party agrees to
take all reasonable steps to ensure that Proprietary or Confidential Information
of either party is not disclosed or distributed by its employees, agents or
consultants in violation of the provisions of this Agreement. Each
party’s Proprietary or Confidential Information shall remain the sole and
exclusive property of that party. Each party expressly agrees to include,
maintain, reproduce and perpetuate all notices or markings on all copies of all
tangible media comprising each party’s Proprietary or Confidential Information
in the manner in which such notices or markings appear on such tangible media or
in the manner in which either party may reasonably request. The
provisions of this Section 5 shall survive
termination or expiration of this Agreement for any reason. For the
purposes of this section, “Proprietary or Confidential Information” shall mean
knowledge and information not generally known in the industry which provides a
competitive advantage, including, without limitation, research and development
programs, formulas, know-how, forecasts, sales and marketing methods, financing
sources, customer and mailing lists, customer usages and requirements, financial
information and all other confidential information, trade secrets and
data. Neither party shall have any obligation with respect to
Proprietary or Confidential Information which: (i) is or becomes generally known
to the public by any means other than a breach of the obligations of a receiving
party; (ii) was rightly received by the receiving party from a third party after
the date hereof, (iv) is independently developed by the receiving party without
reference to information derived from the other party; and (v) subject to
disclosure under court order or other lawful process.
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6.
Termination.
(a) By
Client. The Client may terminate this Agreement immediately
upon delivery of written notice to SPC. In addition, the Client, from
time to time, may expand or reduce the scope of services provided by
SPC. For example, as illustration, Client may determine that the
number of employees at Client has increased to the level where human resource
management should now be handled “in-house” rather than by SPC. The
parties recognize that this will be a flexible and evolving
relationship. If SPC shall incur any expenses in connection with and
resulting from the Client’s expansion, reduction, or termination of any specific
services or provision of technology hereunder, Client shall reimburse SPC for
such costs or expenses promptly upon receipt of an itemized account
thereof.
(b) Notwithstanding
Termination by Client as provided in Section 6(a), unless Client terminates this
Agreement for Cause as hereinafter defined, Client agrees to pay SPC the Base
Rate of Compensation then in effect through the end of the Term. For the
purposes of this Section, “Cause” shall mean the failure of SPC to take
commercially reasonable steps to substantially cure a material breach of its
obligations under this Agreement (“Breach”) within 60 days after delivery of
written notice by Client to SPC (“Cure Notice”), or such longer period as
provided in Section 6(b)(i) (the “Cure Period”). The Cure Notice shall specify
in detail the nature of the Breach, such acts or actions Client reasonably
believes are necessary to substantially cure the Breach, and an undertaking by
Client to provide reasonable assistance and cooperation to SPC in connection
therewith.
(i)
If the
Breach is not capable of cure within 60 days, Cause shall not exist if SPC has
[a] taken commercially reasonable steps to commence a cure within 60 days of
delivery of the Cure Notice and [b] substantially completed the cure within 120
days.
(ii) The
Cure Period shall be extended for one day for each day that any invoice of SPC
for Services rendered hereunder remains unpaid
(c) By
SPC. SPC may terminate the agreement upon not less than 90
days written notice in the event that the Client has failed to pay any
outstanding invoice on the date due or within 30 days
thereafter.
7.
Independent Contractor
Relationship. It is acknowledged and agreed that SPC’s
relationship with the Client is at all times hereunder an independent
contractor. The Client shall have no authority over SPC’s internal
business affairs and decisions. SPC shall have no authority to act on
behalf of, or legally bind the Client, and SPC shall not hold itself out as
having any such authority. This Agreement shall not be construed as
creating a partnership or joint venture.
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8.
Limitation of Liability and
Disclaimer of Warranties.
(a) SPC
hereby warrants and represents that: SPC will provide the services
requested pursuant to this Agreement in a workmanlike and professional
manner. THE SERVICES TO BE PROVIDED OR PERFORMED HEREUNDER ARE
PROVIDED WITHOUT WARRANTY OF ANY KIND AS TO RESULTS. IN NO EVENT SHALL SPC OR
ANY OF ITS OFFICERS, DIRECTORS, OR AGENTS BE LIABLE TO CLIENT OR ANY THIRD PARTY
FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING, WITHOUT LIMITATION,
INDIRECT, SPECIAL, PUNITIVE, OR EXEMPLARY DAMAGES FOR LOSS OF BUSINESS, LOSS OF
PROFITS, BUSINESS INTERRUPTION ARISING OUT OF OR CONNECTED IN ANY WAY WITH SPC’S
PERFORMANCE UNDER THIS AGREEMENT EVEN IF SPC HAS BEEN ADVISED OF THE POSSIBILITY
OF SUCH DAMAGES.
9.
Client
Indemnity.
Client
shall indemnify and hold SPC harmless against any and all liabilities, losses,
damages, judgments, claims, causes of action, and costs (including attorneys
fees and disbursements) which SPC may hereafter incur, suffer, or be required to
pay, defend, settle, or satisfy as a result of third party claims against SPC
based on or arising out of the discharge of its responsibilities
hereunder
10. Miscellaneous.
(a) Force
Majeure. Neither party shall be in default of this Agreement
or liable to the other party for any delay or default in performance where
occasioned by any cause of any kind or extent beyond its control, including but
not limited to, armed conflict or economic dislocation resulting therefrom;
embargoes; shortages or labor, raw materials, production facilities or
transportation; labor difficulties; civil disorders of any kind; action of any
civil or military authorities (including priorities and allocations); fires;
floods; telecommunications failures; Internet slow-downs; and
accidents. The dates on which the obligations of a party are to be
fulfilled shall be extended for a period equal to the time lost by reason of any
delay arising directly or indirectly from:
(i) Any of
the foregoing causes; or
(ii) Inability
of that party, as a result of causes beyond its reasonable control, to obtain
instruction or information from the other party in time to perform its
obligations by such dates.
(b) Severability. Whenever
possible, each provision of this Agreement will be interpreted in such a manner
as to be effective and valid under applicable law, but if any provision hereof
is held by a court of competent jurisdiction to be prohibited or invalid, such
prohibition or invalidity shall not affect the remaining provisions of this
Agreement. In the event a court of competent jurisdiction shall
determine and hold that the covenants contained herein are invalid or
unenforceable for any reason, the parties hereby request that such court reform
the provisions hereof in a manner to cause the covenants contained herein to be
enforceable as closely as possible to the way in which originally
written.
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(c) Seperation.
This Agreement will not apply to or bind in any way any a saleor
spin off or other disposal of any subsidiary or other entity of the
Company.
(d) Counterparts. This
Agreement may be executed in any number of counterparts, each of which, when so
executed, shall be deemed to be an original, and all of which shall together
constitute but a single instrument.
(e) Further
Assurances. The parties hereby agree to execute such
other documents and perform such other acts as may be reasonably necessary or
desirable to carry out the purposes of this Agreement.
(f) Notices. Any and all
notices provided for herein shall be in writing and shall be considered as
properly given if delivered to the party or sent by registered or certified
mail, postage prepaid, to the parties hereto at the addresses set out below
opposite their names or such other address or to the attention of such other
person as the party shall have specified by prior written notice. Any
notice under this Agreement shall be deemed to have been given (a) if delivered
in person, when so delivered or refused; (b) if sent by facsimile or overnight
courier, one (1) business day following transmission or delivery to courier (as
the case may be; or (c) if by registered or certified mail, three (3) days
following deposit in the U. S.
Mail.
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If
to the Client:
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If
to SPC:
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Copies
of all Notices to:
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(g) Binding Effect. This
Agreement shall bind and inure to the benefit of the parties, and their
respective successors, heirs and assigns.
(h) Governing Law. This
Agreement and the obligations of the parties hereunder shall be interpreted,
construed and enforced in accordance with the laws of the State of
Georgia.
(i) Attorneys’ Fees and
Costs. If either party brings suit or arbitration
against the other to enforce the terms of this Agreement, the prevailing party
shall be entitled to recover all reasonable costs, including attorneys’ fees,
from the other party as part of any judgment or award.
(j) Assignment. This
Agreement shall not be assignable in whole or in part by SPC or Client without
the other party’s prior written consent, and any attempted assignment without
such consent shall be void, provided that Client may assign this Agreement to
any person acquiring all or substantially all of its assets without obtaining
such consent.
(k) Survival. The
provisions of this Agreement which by their terms survive the termination of
this Agreement to the extent set forth in such
provisions.
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[SIGNATURE
PAGE FOLLOWS]
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IN
WITNESS WHEREOF, the undersigned parties hereto have duly executed this
Agreement on the date first above written.
| EPGI/FIRECREEK INC | |||
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By:
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,
President and Chief Operating Officer
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| STRATEGIC PARTNERS LLC | |||
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By:
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, President
and Chief Executive Officer
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