ADMINISTRATIVE SERVICES AGREEMENT
Exhibit
10.17
This
Administrative Services Agreement ("Agreement")
is
made as of February 27, 2008 (“Effective
Date”),
by
and between ASSOCIATED THIRD PARTY ADMINISTRATORS, a California corporation
("ATPA")
and,
BENEFITS TECHNOLOGIES, LLC, a Delaware limited liability company,("Company").
WHEREAS
Company, contemporaneously with the execution of this Agreement, is acquiring
certain assets of ATPA and certain other companies pursuant to the terms of
the
Asset Contribution and Combination Agreement by and among the Company,
Information Concepts, Inc. (“ICI”), Trust Benefits Online, LLC, ATPA, Xxxxx
Xxxxxxxxxx, Xxxxxx X. Xxxxxx and Xxxxx X. Xxxxxx dated January 31,
2008 (the "Contribution Agreement"), and as a condition of ATPA's consummation
of the transactions contemplated by the Contribution Agreement, ATPA has
required that this Agreement be executed and that Company engage ATPA to provide
certain administrative, personnel, financial and other services to the Company,
subject to and on the terms and conditions set forth herein.
NOW,
THEREFORE, in consideration of the mutual promises herein contained and other
consideration, the receipt and sufficiency of which is hereby acknowledged,
the
parties intending legally to be bound, agree as follows:
1. ENGAGEMENT
OF ATPA.
The
Company hereby engages ATPA to provide certain services as specifically set
forth herein with respect to the business of the Company, and ATPA hereby
accepts that engagement, on the terms and conditions set forth in this
Agreement.
2. SERVICES
TO BE PROVIDED BY ATPA.
ATPA
shall provide, or cause to be provided, the following services to the Company
throughout the Term (as defined herein):
(a) Administrative
and General Services.
ATPA
shall provide or cause to be provided to the Company, if, when and to the extent
required by the Company, the administrative, general, accounting and financial,
and human resources services described in Schedule
A
(the
"
Services").
(b) Other
Services.
ATPA
shall provide or cause to be provided to the Company, if, when and to the extent
required by the Company, such other services or as the parties shall agree
by
amendment to Schedule A.
(c) Level
of Effort.
ATPA
shall perform the Services using its reasonable commercial efforts but using
no
less care, skill and prudence customarily exercised by it in respect of its
own
business, operations and affairs. However, the Company acknowledges that the
Services shall be provided only with respect to the business of the Company
as
that business exists or is reasonably foreseeable as of the Effective Date
or as
otherwise mutually agreed by the parties. ATPA will not be obligated to provide
the Services for the benefit of any entities other than the
Company.
(d) Information.
The
Company shall provide any information reasonably needed by ATPA to perform
the
Services. If the failure to provide any information renders the performance
of
any requested Service impossible or unreasonably difficult, ATPA, may, upon
reasonable notice to the Company, refuse to provide the Service until the
required information is provided to it.
(e) Selection
of Personnel.
ATPA
shall be entitled to select the persons to perform the Services, provided,
however, that the Company may have ATPA replace persons who (i) willfully or
negligently fail to perform their duties; (ii) commit any dishonest or
fraudulent act in the course of providing the Services; or (iii) are accused
of
committing a felony, whether or not in the course of providing the
Services.
(f) Compliance
with Laws.
The
Company and ATPA each shall comply with all laws, rules and regulation, whether
federal, state or local, which are applicable to its respective business and
activities.
(g) Non-Exclusive
Services.
ATPA is
not required to perform the Services exclusively for the Company, and ATPA
shall
have the right to provide similar services for any other person or entity.
The
Company acknowledges that ATPA will continue to provide the Services in support
of its own operations.
3. CONSIDERATION
FOR SERVICES.
(a) ATPA
Fee.
In
exchange for ATPA’s performance of the Services, the Company shall pay a fee to
ATPA on a monthly basis (the "ATPA
Fee")
equal
to $50.00 per hour for each hour of service provided by ATPA plus any direct
costs paid to outside vendors required to provide those services. The direct
costs passed on to the Company will not be adjusted or marked up in any way.
(b) Invoices.
ATPA
shall submit to the Company, by the fifteenth (15th)
day of
each month, an invoice for the ATPA Fee. All invoices shall describe in
reasonable detail (i) the Services provided during the preceding month and
the ATPA Fee associated therewith, and (ii) any prior month adjustments.
The Company shall pay the ATPA Fee to ATPA within thirty (30) days after
receiving each invoice. A payment made more than thirty (30) days after the
invoice is rendered shall bear interest at the rate of one percent (1%) per
month until paid. Notwithstanding any other provision of this Section, provided
that the Company has timely paid to ATPA all amounts due to ATPA hereunder,
ATPA
shall timely make any and all payments to third parties necessary to ensure
the
continuation of the Services.
(c) Method
of Payment.
Payments made pursuant to this Agreement shall be made in U.S. dollars by
Company check or wire transfer of immediately available funds to an account
or
accounts specified by ATPA. Whenever any payment hereunder is required or
requested on a day other than a business day (Monday through Friday except
for
bank holidays), the payment shall be made on the next succeeding business day,
and any extension of time shall be included in the calculation of the payment
of
interest.
2
(d) Disputes.
In the
event of a good faith dispute as to an amount alleged by ATPA to be due and
owing to it, the Company shall promptly pay all undisputed amounts, but shall
be
entitled to withhold amounts in dispute. The Company shall promptly notify
ATPA
if the Company disputes any involved amounts. Each party will provide the other
sufficient records and information to resolve any dispute and, without limiting
the rights and remedies of the parties hereunder, will attempt to negotiate
in
good faith a resolution thereto.
4. TERM.
This
Agreement shall commence upon the Effective Date and shall continue for a period
of three (3) years thereafter ("Initial
Term").
The
Initial Term (and each renewal term thereafter) shall automatically renew for
an
additional one (1) year period unless either party shall give the other notice
of its intention to terminate the Agreement at least thirty (30) days prior
to
the end of the Initial Term or any renewal term (the Initial Term, as so
extended, the "Term").
Additionally, either party may terminate this Agreement at any time upon thirty
(30) days prior written notice to the other party, and the parties may terminate
the Agreement mutually in writing at any time.
5. REPRESENTATIONS
AND WARRANTIES.
Each
party hereby represents and warrants to the other party that: (i) it is
organized, validly existing, and in good standing under the laws of the state
of
its organization and has all requisite power to enter into this Agreement and
to
carry out the transactions contemplated hereby; (ii) this Agreement has been
duly executed and delivered by it and is the legal, valid and binding agreement
of such party, enforceable against it in accordance with its terms; (iii) the
execution, delivery and performance of this Agreement by the party, and the
consummation of the transactions contemplated hereby, do not and will not
conflict with any provision of any law or regulation to which the party is
subject, or conflict with, result in a breach of, or constitute a default under,
any of the terms, conditions or provisions of any of the organizational
documents of the party or any agreement or instrument to which it is a party
or
by which it is bound, or any order or decree applicable to it, or result in
the
creation or imposition of any lien on the assets of the party; and (iv) no
consent, authorization, approval or order of, or filing with, any court or
governmental body, agency or authority is necessary in connection with the
transactions contemplated hereby, except those which have been obtained or
made
on or prior to the date hereof.
6. LIMITATION
ON LIABILITY; INDEMNIFICATION.
Neither
party shall have any liability under this Agreement (including any liability
for
its own negligence) for damages, losses or expenses suffered by the other party
as a result of the performance or non-performance of such party’s obligations
hereunder, unless the damages, losses or expenses are caused by or arise out
of
the willful misconduct or gross negligence of the party or a breach by the
party
of any of the express provisions hereof. In no event shall either party have
any
liability to the other party for indirect, incidental, consequential or punitive
damages that such other party or its subsidiaries or any third-party may incur
or experience on account of the performance or non-performance of the party’s
obligations hereunder. Notwithstanding the foregoing, each party shall use
its
commercially reasonable efforts to timely cure any defect in or failure of
performance (whether as a result of negligence or otherwise) and to otherwise
correct or improve the level of performance in order to render the Services
in
the manner required by this Agreement.
3
Subject
to the limitations on liability set forth above, each party shall indemnify,
defend and hold harmless the other party and its directors, officers, employees,
agents and representatives from and against all claims, liabilities, damages,
losses and expenses (including reasonable attorneys fees and expenses) caused
by
or arising out of (i) any breach of the indemnifying party’s representations or
warranties under the Agreement; and (ii) any failure on the part of the
indemnifying party to perform or comply with its obligations under this
Agreement.
7. CONFIDENTIALITY.
(a)Confidential
Information.
The
term "Confidential
Information"
means
(i) all client and customer names, addresses, contact information, health
care information, employee information, and other relevant information
concerning clients and customers of the parties hereto; (ii) all financial
information of the parties hereto; (iv) all marketing and sales data and
information of the parties hereto; and (v) all trade secrets, skill, methods,
techniques, scientific data, test data, computer programs, systems, processes,
ideas, designs, devices, concepts, plans, drawings, techniques, intellectual
property, and other confidential information of the parties hereto, including
without limitation, trade secrets, documentation, methods, techniques, data
programs, systems processes, ideas, designs, devices, concepts, plans and
drawings which are contained in, constitute or are related to intellectual
property, regardless of whether developed by the parties hereto or anyone else,
and regardless of whether the information is embodied in written, electronic
or
any other tangible or recoverable medium of expression and, if so embodied,
the
form in which it is embodied.
(b)Non-Disclosure.
Each
party shall hold in confidence, shall not disclose to third parties or make
commercial or other use of, for its own benefit or the benefit of anyone else,
any Confidential Information received or acquired from the other party, whether
received or acquired before or after the date of this Agreement, without prior
written permission of the disclosing party. A party may only provide
Confidential Information of the other party to its employees on a need-to-know
basis and on the condition that those employees are bound by non-disclosure
and
non-use obligations which are as restrictive as the non-disclosure and non-use
restrictions contained in this Section 7. The receiving party shall be
responsible for any breach of this Agreement by any of its agents and
representatives.
(c)Return
of Confidential Information.
All
Confidential Information (and all copies thereof) disclosed under this
Agreement, directly or indirectly, shall remain the exclusive property of the
disclosing party and must be returned or destroyed upon the sooner of written
request of the disclosing party or upon the termination of this Agreement.
Upon
written request of the disclosing party, or upon the termination of this
Agreement, whichever first occurs, all analyses, compilations, studies and
other
material based in whole or in part on such material prepared by the receiving
party shall be destroyed by the receiving party.
(d)Exceptions.
The
term "Confidential Information" does not include information that is: (i) now
generally known to the public or to use any other information from and after
the
time it becomes so known, provided that the information does not become known
as
a result of disclosure by the receiving party or by anyone in privity with
the
receiving party; (ii) developed and possessed prior to its disclosure in
connection with the Services provided under this Agreement; (iii) received
lawfully and in good faith from a third party who has no confidentiality
obligation to the parties hereto, directly or indirectly, with respect to that
information; (iv) developed by the receiving party independently of any
disclosures made in connection with the Services provided under this Agreement
as evidenced by the receiving party’s written records; (v) or is required to be
disclosed pursuant to law, regulation or court order, provided, however, that
the party subject to that requirement gives the other party prompt written
notice prior to that required disclosure in order to allow the other party
to
take whatever action it deems necessary to protect its Confidential Information.
4
(e)Injunction.
In view
of the nature of the Confidential Information, the receiving party acknowledges
that any unauthorized disclosure of the Confidential Information or other
violation, or threatened violation, of this Agreement would cause irreparable
damage to the disclosing party; and therefore, the disclosing party shall be
entitled to an injunction or other equitable relief prohibiting the receiving
party from any such disclosure, attempted disclosure, violation or threatened
violation of this Agreement, and the receiving party further hereby waives,
and
shall use its best efforts to cause its representatives to waive, any
requirement for the securing or posting of any bond or similar form of assurance
in connection with that remedy.
(f)Term
of Confidential Information.
Except
as may be expressly set forth to the contrary herein, the parties’ obligations
under this Section shall remain in effect for three (3) years following the
end
of the Term with respect to information which is not a trade secret and shall
continue in effect as to information which is a trade secret for as long as
that
information remains a trade secret (provided, however, that the failure of
the
information to remain a trade secret does not result from the breach of the
Agreement by the receiving party or its agents or representatives).
8. INDEPENDENT
CONTRACTOR.
Neither
of the parties is now, nor shall it be made by this Agreement, an agent or
legal
representative of the other party for any purpose, and neither party has any
right or authority to create any obligation, express or implied, on behalf
of
the other party, to accept any service of process upon it, or to receive any
notices of any kind on its behalf. All activities by each party hereunder shall
be carried on by each party as an independent contractor and not as an
agent.
9. GOVERNING
LAW. This
Agreement shall be governed by and construed in accordance with the laws of
the
State of California without reference to the conflicts of law principles
thereof.
10. ENTIRE
AGREEMENT. The
agreement of the parties, which is comprised of this Agreement and Schedule
A
hereto, sets forth the entire agreement and understanding between the parties
and supersedes any prior agreement or understanding, written or oral, relating
to the subject matter of this Agreement. If any terms in a purchase order (if
applicable) or invoice by either party are not consistent with the terms of
this
Agreement, the terms of this Agreement shall govern, except as otherwise
specifically set forth herein.
11. BINDING
EFFECT; SEVERABILITY.
This
Agreement shall be binding upon and inure to the benefit of the successors
and
assigns of the parties hereto. This
Agreement shall not be assignable, except with the written consent of the other
party. The
provisions of this Agreement are severable, and in the event that any one or
more provisions are deemed illegal or unenforceable the remaining provisions
shall remain in full force and effect unless the deletion of such provision
shall cause this Agreement to become materially adverse to any party, in which
event the parties shall use reasonable efforts to arrive at an accommodation
which best preserves for the parties the benefits and obligations of the
offending provision.
5
12. NO
THIRD PARTY BENEFICIARIES.
Nothing
in this Agreement, express or implied, is intended to or shall (a) confer on
any
person other than the parties hereto and their respective successors or
permitted assigns any rights (including third party beneficiary rights),
remedies, obligations or liabilities under or by reason of this Agreement or
(b)
constitute the parties hereto as partners or as participants in a joint venture.
This Agreement shall not provide third parties with any remedy, claim,
liability, reimbursement, cause of action or other right in excess of those
existing without reference to the terms of this Agreement.
13. AMENDMENT
AND WAIVER.
The
parties may by mutual written agreement amend this Agreement in any respect,
and
any party, as to such party, may (a) extend the time for the performance of
any
of the obligations of any other party, (b) waive any inaccuracies in
representations by any other party, (c) waive compliance by any other party
with
any of the Sections contained herein and performance of any obligations by
such
other party, and (d) waive the fulfillment of any condition that is precedent
to
the performance by such party of any of its obligations under this Agreement.
To
be effective, any such amendment or waiver must be in writing and be signed
by
the party against whom enforcement of the same is sought.
14. FURTHER
ASSURANCES.
From
time to time after the Effective Date and without any further consideration,
each party hereto covenants to execute and deliver, or cause to be executed
and
delivered, such further instruments of conveyance, assignment, transfer,
confirmation, assumption, etc. and to take any further actions and to execute
any further agreements, instruments, certificates, documents or undertakings
as
shall be necessary or appropriate to give full effect to the intent and purposes
of the contribution and assignment provisions in this Agreement.
15. WAIVER
OF RIGHT TO JURY TRIAL.
EACH
PARTY TO THIS AGREEMENT WAIVES ITS RIGHT TO, AND AGREES NOT TO REQUEST, A JURY
TRIAL WITH RESPECT TO ANY ACTION, SUIT, PROCEEDING OR COUNTERCLAIM BROUGHT
UNDER
OR IN CONNECTION WITH THIS AGREEMENT.
6
IN
WITNESS WHEREOF, ATPA and the Company have signed this Administrative Services
Agreement as of the day and year first above written.
| ASSOCIATED THIRD PARTY ADMINISTRATORS | ||||
| By: | /s/ Xxxx Xxxxxxxxx | |||
|
Name: Xxxx Xxxxxxxxx |
||||
| Title: President | ||||
| BENEFITS TECHNOLOGIES, LLC | ||||
| By: | /s/ Xxxxxxx Xxxxxxx | |||
|
Name: Xxx Xxxxxxx |
||||
| Title: Chairman | ||||
7
Schedule
A
Administrative
and General Services
|
1.
|
ACCOUNTING
SERVICES:
|
|
·
|
Bookkeeping
and accounting services, including maintenance of the
Company’s
billing, general ledger, accounts receivable and accounts payable
functions, as needed.
|
|
2.
|
PAYROLL
SERVICES
|
|
·
|
Processing
of payroll and preparation and filing of related tax returns. Payroll
to
be processed based on employee time information and employee change
forms
provided by the Company.
|
|
3.
|
INFORMATION
TECHNOLOGY / TECHNICAL SUPPORT
SERVICES
|
|
·
|
Routine
network administration and related hardware maintenance and
support.
|
|
·
|
Other
typical IT/ Tech Support services
|
4. HUMAN
RESOURCES:
|
·
|
Advice
and assistance with respect to employee benefits, plan administration,
legal compliance and other employee
matters.
|
8
