iLabor Network Supplier Agreement Amendment No. 2
Amendment
No. 2
Whereas,
pursuant to the iLabor Network Supplier Agreement entered into between
ClearPoint Resources, Inc. (“ClearPoint”), Staffchex, Inc.
(“Staffchex”) and Staffchex Servicing, Inc. (“Staffchex Servicing” and together
with “Staffchex”, the “Company”) on February 28th, 2008
(the “Agreement”), and as Amended on March 16th, 2009,
ClearPoint and the Company wish to enter into this amendment (the “Second
Amendment”) to the Agreement dated this 18th day
of November, 2009 but effective as of November 1, 2009 (the “Effective Date”) as
follows:
1. Section 3 of the Agreement “3. Compensation; Payment Terms; Insurance;
Taxes” shall be deleted in its entirety and
replaced with the following:
3. Compensation; Payment Terms;
Insurance; Taxes. For services performed in accordance with
the Project requirements, ClearPoint will pay the Company for billable work
hours approved by the Client at the agreed-upon hourly xxxx rate (the “Fee”). ClearPoint
will pay the Company its Fee within thirty (30) business days of invoice
date. If Client fails to pay ClearPoint, then ClearPoint is not
liable to the Company for such fee. The Company will carry and maintain
sufficient workmen’s compensation, liability and other insurance customary in
this industry covering all Temps placed with a Client. The Company
will be solely responsible for the payment of all Temp wages, benefits,
applicable taxes (including, but not limited to, social security, federal,
state, local or any other employee payroll taxes) and insurance costs arising
from the Company’s performance of the services requested by
Client. The hourly xxxx rate includes payment for all taxes, fees,
fringe benefits, insurance, workmen’s compensation coverage, profit and
overhead. The Company shall use ClearPoint’s web-based computer
program for time reporting.
On the
date hereof, The Company will transfer the Transferred Accounts (Transferred
Accounts are defined those contracts listed in Exhibit A of the Assignment and
Assumption Agreement and Xxxx of Sale dated November 18, 2009 entitled
“Contracts”) detailed on Attachment A hereto, which during the first full week
after operational transfer thereof (which shall be no later than December 14,
2009) shall meet or exceed minimum xxxxxxxx of $96,153 for such week
(the “Guaranteed Xxxxxxxx”). In the event that the xxxxxxxx for such
Transferred Accounts do not meet or exceed the Guaranteed Xxxxxxxx, Staffchex
shall immediately transfer additional accounts sufficient to reduce the
shortfall to zero. ClearPoint in its Reasonable Discretion can
accept or reject Transferred Accounts; for purposes of this agreement,
Reasonable Discretion may include, but not be limited to, for reasons of
pricing, safety and risk, credit worthiness, and rejection by the
network.
ClearPoint
agrees that through the Effective Date, the Compensation shall be capped at
1.25% of weekly collections. As of the Effective Date ,
the Company shall adjust the Compensation to ClearPoint to seventy-five one hundreds of one percent (0.75%) of all
collections from the its xxxxxxxx for temporary staffing services provided by
the Company, regardless of whether such services were provided through the
Network (the “Compensation”); provided that this
amount shall be payable in two portions (1) Twenty-five one hundreds of one
percent (0.25%), ,to the extent not
already paid by Staffchex, shall be payable weekly
from Effective Date through January 31, 2010; (2) the balance, Fifty one
hundreds of one percent (0.50%) (the
“Deferred Percentage”) of the total
collections during each calendar month from Effective Date through January 31,
2010 will be deferred and added to the second portion ($3,105) of the Prior
Compensation noted below (Deferred Percentage multiplied by collections
from the Effective Date through
January 31, 2010 during each calendar month divided by 52 plus $3,105) but
without any additional amounts calculated for interest or similar compensation (the
“Deferred Amount”) and
thereafter the Compensation will be due and
payable on each Payment Date (as defined below). Past due
Compensation owed through the Effective Date (collections from September 28
through the Effective Date calculated at 1.25% less amounts previously paid)
will be paid in equal weekly installments commencing March 1, 2010 through May
31, 2010 in addition to other amounts owed.
For the six (6) month period commencing February 1, 2010 and ending July 31, 2010, the
average monthly xxxxxxxx for Transferred Accounts (and any additional transferred accounts transferred
by Staffchex), measured at the end of such six (6) month period, shall meet or exceed a minimum of $625,000 per month. In the event the xxxxxxxx from the
Transferred Accounts and additional transferred accounts do
not meet the $625,000 minimum average described above, then five percent (5%) of
the shortfall between the actual xxxxxxxx and the $625,000 minimum average
described above will be due and payable in equal installments over the sixteen
week period beginning with the payment in September 1,
2010. Staffchex, at its own
expense, shall have the right to audit or have an independent third party
audit the directly relevant financial records generated by ClearPoint for the
limited purpose of verifying the accuracy of the amount of the xxxxxxxx with
respect to the Transferred Accounts and
additional
transferred accounts. Upon the date on which the
xxxxxxxx from the Transferred Accounts and
additional transferred accounts meet
or exceed a total of $307,682 per week for six (6) consecutive weeks, ClearPoint
shall immediately pay a success fee in the form of an immediate transfer and
assignment of all Eighteen Thousand Six Hundred
and Seven (18,607) shares of
stock of Staffchex (the “Success Fee”) and this Agreement shall automatically
terminate and be of no further force and effect without any further action by
the parties hereto; provided however that all
provisions with respect to the payment of the Prior Compensation and any
Deferred Amount shall survive the termination of this Agreement without
reduction until paid in full in accordance with the terms
hereof. In connection with the delivery of the Success Fee,
ClearPoint hereby irrevocably constitutes and appoints Staffchex and any officer
or agent thereof, with full power of substitution, as its true and lawful
attorney-in-fact with full irrevocable power and authority in the place and
stead of ClearPoint and in the name of ClearPoint, from time to time in the
discretion of Staffchex, for the purpose of carrying out the terms of payment
and transfer under the Success Fee, and to take any and all appropriate action
and to execute any and all documents and instruments which may be necessary or
desirable to accomplish the same. This power of attorney is a power
coupled with an interest and shall be irrevocable. Except as set forth herein with respect to payment of
the Deferred Amount, payment of Compensation shall be made via wire
transfer on Wednesday (the “Payment Date”) of each week, commencing on the first
Wednesday of every week following the Effective Date of this Second Amendment,
for the prior week’s collections until this Agreement is terminated in
accordance with its terms.
Additionally,
the Company agrees to continue to make a total of 104 weekly payments which
began on June 3, 2009 of $4,096.00, followed by fifty-two weekly payments of
$3,105.00 commencing on Wednesday June 1, 2011 for previous Compensation (the
“Prior Compensation”) owed through February 28, 2009, which amounts are
inclusive of principle and interest. Amounts included in Prior Compensation may not be waived or
terminated as a result of any other clause contained herein.
If
ClearPoint fails to receive payment of Compensation, Deferred Percentage, Prior
Compensation or any other amount due and payable in connection with this
Amendment No 2 on any given Payment Date, it shall be deemed a material breach
of this Agreement. If the Company fails to make any given payment to
ClearPoint, they will have ten (10) business days (the “Cure Period”) to cure
any delinquency and bring all subsequent payments which may have become due
current. In the event that the Company fails to make payments
as described above during the Cure Period, the rate on all future collections
will revert to 1.25% (the “Default Rate”). Notice will be deemed to
have been automatically given in the event of non-payment. In the
event that any delinquent payments are not made during the Cure Period, the
Company hereby agrees to submit a request to its receivables factoring company
to pay ClearPoint directly for all delinquent and prospective Compensation and
Prior Compensation within two (2) business days of the expiration of the Cure
Period. If the Company has not contacted its receivables factoring
company within two (2) business days of the expiration of the Cure Period noted
above, the Company hereby gives ClearPoint express permission to contact the
receivables factoring company directly to request that receivables factoring
company forward all future agreed upon fees directly to ClearPoint in accordance
with the terms of this Agreement. The Company shall provide
ClearPoint access to all reporting regarding lockbox receipts and weekly
submissions to the Company’s lenders, all on a weekly basis.
Within
two (2) years after each year of this Agreement, ClearPoint shall have the right
to have an independent third party (the “Auditor”) audit the directly relevant
financial records generated by the Company for the limited purpose of verifying
the accuracy of the amount of the payments owed to ClearPoint under this
Agreement. ClearPoint may cause the Auditor to perform such an audit
not more than twice in any twelve (12) month period, however, if any
discrepancies are identified in an audit, then ClearPoint can thereafter perform
such audits not more than four (4) times per year. ClearPoint shall
give reasonable advance written notice to the Company, and each audit shall be
conducted during normal business hours. The expenses of the Auditor
shall be paid by ClearPoint unless, in any given audit, ClearPoint determines
that the Compensation paid to ClearPoint differs from that audit by more than
five percent (5%), in which case the reasonable expenses of the Auditor shall be
paid by the Company.
The
Company shall not be permitted to assign, convey, sell, transfer or lease the
Customer Account Property (or the underlying Customer Agreements) transferred to
the Company pursuant to that Asset Purchase Agreement, dated February 28, 2008,
by and between the Company and ClearPoint, without obtaining the
prior written consent of ClearPoint; provided, however, ClearPoint’s consent
will not be required if the assignment, conveyance, sale, transfer or lease of
the Customer Account Property (or the underlying Customer Agreement) occurs
after February 28, 2012 and is part of a sale of all of the stock or all or
substantially all of the assets of the Company (whether by merger,
consolidation, sale of stock, operation of law or otherwise).
2. Binding Effect. All of the terms and
provisions of this Agreement shall remain the same in full effect and be binding
upon and inure to the benefit of and be enforceable by the heirs,
administrators, personal representatives, successors and assigns of the Parties
hereto.
3. Governing Law. This Agreement shall
be governed by and construed in accordance with the laws of the Commonwealth of
Pennsylvania without reference to the choice of law principles
thereof. Any legal action or proceeding arising out of or in
connection with this Agreement shall be brought in the federal or state courts
located in Philadelphia or Bucks
Counties, Pennsylvania, and
the parties hereto irrevocably submit to the exclusive jurisdiction of such
courts. Each of the parties hereto hereby irrevocably waives any
objection to the laying of venue, in personam jurisdiction or based on grounds
of forum non-conveniens which it may now or hereafter have to the bringing of
any action or proceeding in such jurisdiction.
4. Counterparts. This Agreement may be
executed in two counterparts, each of which shall be deemed an original, but all
of which shall be considered one and the same agreement.
IN
WITNESS WHEREOF, the parties hereto have executed and delivered this iLabor
Network Supplier Amendment No. 2 as of the
date above.
| CLEARPOINT RESOURCES, INC. | STAFFCHEX, INC. | ||||
| By: | /s/ Xxxxxxx Xxxxxx | By: |
/s/
Xxxxx Xxxxx
|
||
| Name: |
Xxxxxxx
Xxxxxx
|
Name: |
Xxxxx
Xxxxx
|
||
| Title: |
CEO
|
Title: |
CEO
|
||
| STAFFCHEX SERVICING, LLC | |||||
| By: | /s/ Xxxxx Xxxxx | ||||
| Name: | Xxxxx Xxxxx | ||||
| Title: | CEO | ||||
