EXHIBIT 10.16
ADMINISTRATIVE SERVICES AGREEMENT
THIS ADMINISTRATIVE SERVICES AGREEMENT ("Agreement") is entered into
effective as of October 1, 1999, between X00.xxx, Inc. a Delaware corporation
("X00.xxx"), and Orca Monitoring Services, LLC, a Washington limited liability
company ("Orca").
RECITALS
A. X00.xxx is engaged in the business of designing, developing, marketing
and selling home automation, home security and home entertainment products;
B. Orca is engaged in the business of professional security monitoring
and alarm system product support, and operates a Customer Support Center with
employees providing 24-hour customer service by telephone; and
C. X00.xxx desires that Orca provide X00.xxx with certain administrative
and customer service support, and Orca is willing to provide those services to
X00.xxx under the terms and conditions set forth below.
In consideration of the mutual covenants and conditions contained herein,
the parties agree as follows:
AGREEMENT
1. Term. The term of this Agreement shall commence on October 1, 1999
(the "Effective Date"), and will be for a term of one (1) year, to be
automatically renewed for subsequent one-year terms unless terminated by mutual
agreement of the parties or as otherwise provided herein. In the event of a
material breach by either party in the performance of its obligations hereunder,
the non-breaching party may terminate this Agreement by giving thirty (30) days
written notice to the other party.
2. Description of Corporate Services. From and after the Effective Date,
Orca agrees to provide X00.xxx with administrative and customer service support
as may be requested by X00.xxx (the "Services"), including the following:
a. General telephone reception services during regular office
hours;
b. Twenty-four hour overflow telephone customer service and
technical support in accordance with information, manuals and training
provided by X00.xxx; and
c. General office administration and support, including
utilities, telephone, conference rooms, janitorial service and other
office services, equipment and facilities.
3. Service Fees. Orca shall be entitled to fees for the performance of
the Services rendered under this Agreement in amounts determined in accordance
with Schedule A attached hereto. Such fees shall be payable within thirty (30)
days after receipt of invoice from Orca for Services rendered during the
preceding month.
4. Training. X00.xxx shall provide at its expense such information,
manuals and employee training as may be necessary for employees of Orca to
initially perform the Services. Orca shall thereafter be responsible, at its
expense, for training new employees to perform the Services.
5. Independent Contractor. Orca is an independent contractor. This
Agreement shall not create the relationship of an employer and employee, a
partnership, or a joint venture. Orca shall be responsible for all wages,
benefits, income taxes, unemployment taxes, social security, workers'
compensation insurance and other taxes, withholdings, expenses and deductions
arising out of the services rendered by Orca or its employees under this
Agreement.
6. Assignment. This Agreement shall not be assigned by either party and
any attempt to assign shall be void and without any effect, except upon the
express mutual consent of the parties.
7. Notices. All notices or other communications hereunder shall be in
writing and shall be made by hand delivery or registered or certified mail,
postage prepaid, return receipt requested, addressed as follows:
X00.xxx: X00.xxx
00000 00xx Xxxxxx Xxxxx
Xxxxxxx, XX 00000-0000
Attn: CFO
Orca: Orca Monitoring Services, LLC
00000 00xx Xxxxxx Xxxxx
Xxxxxxx, XX 00000-0000
Attn: President
or at such other address as shall be furnished by any of the parties by like
notice, and such notice or communication shall be deemed to have been given or
made as of the date so delivered, if delivered personally, and three (3)
calendar days after so mailed, if sent by registered or certified mail.
8. Entire Agreement. This Agreement constitutes the entire agreement
between the parties, and all prior arrangements and negotiations between the
parties are hereby deemed to be merged therein. This Agreement may be modified
or amended only by mutual written consent of the parties.
9. Confidentiality. Orca understands and agrees that all financial and
other information of X00.xxx is proprietary and confidential information. Orca
agrees to protect and preserve as confidential all financial and other
information of X00.xxx. Orca will not disclose such
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information to any person or entity (including affiliates of Orca) except to
Orca's employees who have a need to know such information for use in furtherance
of this Agreement and who agree, in writing, to hold all such information in
confidence. Orca will use such information only to perform its obligations under
this Agreement, and will not use any of such information for any other purpose
and will not allow any other person or entity (including affiliates of Orca) to
use any of X00.xxx's proprietary or confidential information in any other way,
without X00.xxx's prior written consent. Orca further agrees that all materials
which result from services performed hereunder shall be and remain the property
of X00.xxx and, upon termination on this Agreement or earlier request, shall be
delivered to X00.xxx
10. Governing Law. This Agreement shall be governed by and construed in
accordance with the Laws of the State of Washington without reference to
conflict of laws.
11. Severability. If any portion of this Agreement shall be held invalid
or inoperative, then, so far as is reasonable and possible, the remainder of
this Agreement shall be considered valid and operative, and effect shall be
given to the intent manifested by the portion held invalid or inoperative.
12. Attorneys' Fees. The prevailing party in any action between the
parties which is based on this Agreement or any document related hereto shall
have its reasonable attorneys' fees and other costs incurred in such action or
proceeding including any incurred for pre-suit, trial, arbitration,
post-judgment and appeal, paid by the other party.
Executed as of the date first above written.
X00.XXX, INC.,
a Delaware corporation,
By /s/ Xxxx Xxxxxxxx CFO
-------------------------------------
ORCA MONITORING SERVICES, LLC,
a Washington limited liability company,
By /s/ Alex Peder
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Schedule A
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Calculation of Service Fees
A. Telephone service: Fee based on actual charges for dedicated phone lines
and a percentage of combined lines based on head count. Updated quarterly.
B. Utilities and janitorial service: Allocated based on percentage of floor
space. Updated quarterly.
C. General office administration services: Fees based on combination of head
count and percentage of floor space. Updated quarterly.
D. Overflow Call Coverage: Fees based on percentage of calls answered as
follows:
CSR average rate of pay
answer overflow sales calls for X00.xxx
From HR manager: CSR hrly rate Average hourly rate of customer service reps (updated quarterly)
Burden and OH 25% 15% benefit rate; 10% OH. CSR would be on site regardless of overflow calls
Commission per hour* Average commission per hour
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average rate of pay Total rate of pay (hourly)
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*Commission per hour
average $ Average dollars rec'd as commissions (updated quarterly based on actual)
# of calls Actual number of calls answered by CSR's
Duration (min) Average duration of each call (updated quarterly based on actual)
time on calls (hrs) Calculation
$/hr Total commission per hour
Tech Services average rate of pay
answer tech questions for active home - assigned 800 number
From HR manager: CSR hrly rate Average hourly rate of customer service reps (updated quarterly)
Burden and OH 25% 15% benefit rate; 10% OH. CSR would be on site regardless of overflow calls
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average rate of pay Total rate of pay (hourly)
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