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[Administaff LOGO]
CLIENT SERVICE AGREEMENT
THIS CLIENT SERVICE AGREEMENT (the
"Agreement") is between Administaff Companies
II, L.P., ("Administaff"), a Delaware
limited partnership, with its principal
place of business at 19001 Crescent Springs
Drive, Kingwood, Texas 77339-3802,
and Diversified Security Solutions, Inc.
("Client"). Administaff is a
professional employer organization, serving
Client as an off-site, full service
human resource department. Administaff
personnel management services are
delivered by entering into a co-employment
relationship with Client's employees.
This relationship and the allocation of
responsibilities are defined in this
Agreement.
I. PERSONNEL
Administaff and Client agree that
Administaff will provide personnel management
services to Client through an allocation of
responsibilities and that
Administaff and Client will be co-employers
of the worksite employees assigned
to Client's worksite ("Staff") for the job
functions listed in Schedule A
("Confidential Census"). Client warrants
that information supplied to
Administaff on the Confidential Census is
accurate as supplied and acknowledges
that Administaff is relying on the accuracy
of the information. Client agrees on
an ongoing basis to amend Schedule A to
reflect each change in pay rate,
addition or deletion of Staff, or any
change in their workers' compensation code
within five (5) days of the effective date
of such change or addition. If such
information is inaccurate, Client shall
promptly notify Administaff.
II. TERM OF AGREEMENT
This Agreement shall commence on the date
shown below and remain in force until
either Administaff or Client terminates the
Agreement by giving thirty (30) days
prior written notice unless otherwise
provided herein or as agreed to in writing
by Client and Administaff.
III. ADMINISTRATION
3.1 Administaff is responsible for the
following:
a. reserving a right of
direction and control over Staff, including a
right to hire or terminate as to Administaff's employment
relationship
with Staff, maintain Staff records, and a right to resolve
Staff
disputes not subject to a collective bargaining agreement;
b. payment of salaries, wages,
and compliance with applicable rules and
regulations governing the reporting and payment of all federal
and
state taxes on payroll wages paid under this Agreement, including,
but
not limited to: (i) federal income tax withholding provisions of
the
Internal Revenue Code; (ii) provisions of state and/or local
income
tax withholding laws, if applicable; (iii) provisions of the
Federal
Insurance Contributions Act ("FICA"); (iv) provisions of the
Federal
Unemployment Tax Act ("FUTA"); and, (v) provisions of applicable
state
unemployment tax laws;
c. providing employee benefits
under the terms and conditions as amended
from time to time, of those Administaff sponsored plans set forth
on
Schedule B, if any are to be provided, and compliance with its
obligations under the Health Insurance Portability and
Accountability
Act ("HIPAA") if applicable, and the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), if applicable solely
with
respect to employee benefit plans sponsored by Administaff;
d. procurement of workers'
compensation insurance and administration of
claims for Staff;
e. development and
implementation of policies and practices in
conjunction with Client relating to personnel management
services
only, including, but not limited to, enrolling, recruiting,
interviewing, testing, selecting, training, evaluating,
replacing,
supervising, disciplining, reassigning, and terminating Staff;
and
f. compliance with any
applicable state statute or regulations governing
a professional employer organization.
3.2 Client is responsible for the
following:
a. the service provided or
product produced by Client;
b. the direction and control
over Staff as necessary to conduct Client's
business, including a right to hire or terminate as to Client's
employment relationship with Staff, and comply with any
applicable
licensure, regulatory or statutory requirement of Client and/or
Staff;
c. development and
implementation of policies and practices related to
the services provided or product produced by Client, including,
but
not limited to hiring, training, evaluating, supervising,
disciplining
and terminating Staff;
d. compliance with any
professional licensing, fidelity bonding, and/or
professional liability insurance requirements;
e. compliance with Occupational
Safety and Health Administration ("OSHA")
regulations, Environmental Protection Agency ("EPA")
regulations,
child labor laws, Worker Adjustment and Retraining Notification
Act
("WARN"), Fair Labor Standards Act ("FLSA"),
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including Equal Pay Act, Uniformed Services Employment and
Reemployment Rights Act ("USERRA") and compliance with federal
governmental contracting provisions, and any state and/or local
equivalent of any of the foregoing;
f. compliance with National
Labor Relations Act ("NLRA") and liability
for all obligations, including organizing efforts and process
expenses, related to Client's collective bargaining agreement and
any
benefits arising from such agreement;
g. the operation of Client's
business, equipment or property, including
motor vehicles;
h. the payment, through
Administaff, of commissions, bonuses, paid leaves
of absence, and severance payments to Staff, if any;
i. the payment of any
non-qualified deferred compensation or equity based
compensation of any type, including, but not limited to, stock
options, restricted stock and phantom stock, the number and value
of
options granted, whether such payment is actual or imputed for
taxing
purposes, and compliance with all applicable rules and
regulations
governing such compensation including, but not limited to,
valuation,
payment or reporting of such compensation;
j. development and
implementation of policies and practices to establish
and maintain Client's intellectual property rights including but
not
limited to patents, trademarks, copyrights, trade secrets and
confidential information and to prevent any infringement or
unauthorized use of Client's intellectual property rights by any
third
party;
k. development and
implementation of policies and practices to avoid
infringement or unauthorized use by Staff and/or Client of any
intellectual property rights;
l. to the extent Client deems
appropriate, entering into agreements with
Staff concerning assignment of inventions and copyrights to Client
and
protection of Client's intellectual property rights;
m. compliance with
administrative procedures established by Administaff
with respect to Administaff sponsored employee benefit plans;
n. compliance with all
applicable requirements of HIPAA and ERISA, if
any, with respect to Client and/or its employees, including but
not
limited to, Client's business operations, Client-sponsored
employee
benefit plans and Client's workplace; and
o. compliance with Fair Credit
Reporting Act ("FCRA") and any state
equivalent in the event Client processes its own
employee/candidate
background checks.
3.3 Administaff and Client will each be
responsible for its own compliance with
all federal, state and local employment
laws, including, but not limited to,
Title VII of the 1964 Civil Rights Act; Age
Discrimination in Employment Act
("ADEA"); Title I of the Americans with
Disabilities Act ("ADA"); Family and
Medical Leave Act ("FMLA"); Consumer Credit
Protection Act, Title III; 42 U.S.C.
Section 1981; Section 503 of the
Rehabilitation Act of 1973; immigration laws
and regulations, and any state and/or local
equivalent of the foregoing, as well
as any and all personnel management
policies and procedures that are maintained
by Administaff and referenced in paragraph
3.1e.
3.4 The provisions of this Agreement
relating to any 401(k) plan sponsored or
maintained by either party are set forth on
Exhibit F of this Agreement.
3.5 Responsibility for compliance with
COBRA is as follows:
a. Client's responsibility for
COBRA: The Client is responsible for
compliance with Client's COBRA responsibilities, if any, except to
the
extent expressly provided by paragraph 3.5(b). The Client is
also
responsible for any other benefit coverage continuation, conversion
or
any other obligation originating from or in any way related to a
plan
maintained by Client or a predecessor plan to such plan at any
time.
b. Administaff responsibility
for COBRA:
(i) Administaff is
responsible for compliance with any COBRA
obligations that may exist for any Staff who is an active
employee participant in an Administaff sponsored plan; and
(ii) Administaff agrees to provide benefit coverage eligibility
on
Client's behalf consistent with Client's COBRA
responsibilities,
if any, for any individual that: (A) elects COBRA coverage
under
an Administaff sponsored health plan which will become
effective
on the Effective Date or reasonably soon thereafter; or (B) is
within the sixty (60) day election period for COBRA on the
Effective Date and subsequently elects COBRA coverage under an
Administaff sponsored health plan, (collectively, the "Client's
COBRA Participants") to the extent the number of such Client's
COBRA Participants does not exceed ten percent (10%) of the
total
number of Staff as of the Effective Date. Additionally,
Administaff agrees to provide benefit coverage eligibility on
Client's behalf, consistent with Client's COBRA
responsibilities,
if any, for Client's COBRA Participants in excess of ten
percent
(10%) of the total number of Staff on the Effective Date
("Excess
Client COBRA Participants") subject to the additional fees set
forth in paragraph 8.10 of this Agreement. Any benefits
coverage
eligibility provided by Administaff shall only be provided in a
manner consistent with the employee benefits available to
Staff,
as indicated on Schedule B excluding employee contributions by
Staff, if any. Any
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obligation of Administaff to provide benefit coverage
eligibility
on Client's behalf as provided above is solely limited to
Client's COBRA responsibility.
c. For purposes of this
paragraph 3.5, only Staff employed on the
Effective Date and regularly scheduled to work thirty (30) or
more
hours per week (or as otherwise required by law), shall be
considered
in computing the total number of Staff as of the Effective
Date.
IV. SUPERVISION AND EMPLOYMENT AGREEMENT
4.1 One or more on-site supervisors shall
be designated by Administaff from
among Staff. On-site supervisors shall be
Administaff's contact for facilitating
personnel management services provided by
Administaff.
4.2 Employees listed on Schedule A, and any
Staff added later, become
co-employees of Administaff only when (i)
he/she becomes an employee of Client;
(ii) he/she executes an Administaff
Employment Agreement as set forth in Exhibit
C ("Employment Agreement"); and, (iii)
Client pays the first Administaff invoice
covering such employee.
V. WORK ENVIRONMENT
5.1 Client agrees that it will comply, at
its sole cost and expense, with all
applicable federal, state and local health
and safety laws, regulations, rules,
ordinances, and directives and rules
relating to workplace, provide and ensure
use of all personal protective equipment,
and follow all recommendations
concerning a safe work environment
suggested by Administaff's workers'
compensation insurance carrier.
5.2 Client agrees to immediately report to
Administaff all work-related
accidents and injuries involving Staff.
5.3 Administaff and Administaff's workers'
compensation insurance carrier shall
have the right to inspect Client's
workplace, including, but not limited to, any
job sites at which Staff work. To the
extent possible, such inspections shall be
scheduled at mutually convenient times.
VI. INSURANCE
6.1 Administaff shall, at its expense, keep
in force at all times during this
Agreement, workers' compensation insurance
covering Staff. Client shall be named
an alternate employer. Upon written request
by Client, Administaff shall request
that its insurance carrier furnish a
certificate of insurance verifying
coverage. The policy shall include a waiver
of subrogation.
6.2 a. Administaff shall maintain
Employment Practices Liability Insurance
Policy ("EPLI") with coverage for Client,
provided:
(i) Client provides
Administaff notice immediately but in no event
more than five (5) days of its becoming aware of any charge,
litigation, request for arbitration, or demand letter involving
Staff, former Staff or an applicant that could give rise to a
claim under EPLI; and
(ii) Client complies with the requirements set forth at
paragraphs
11.8 and 11.11 of this Agreement.
b. The Administaff EPLI policy
provides for a deductible, to be paid by
the Client, and provides a maximum coverage amount. The policy
covers
reasonable and necessary attorneys' fees only from attorneys
selected
from the insurance carrier approved panel. Coverage will be
determined
upon notice of a claim. The notice specified above shall be sent
by
facsimile transmission to 281.348.3118 Attn: EEO Compliance with
the
original document following via overnight courier to the address
shown
in paragraph l3.7.
c. The EPLI coverage terminates
with the termination of this Agreement.
d. This paragraph 6.2 is
subject to the terms and conditions set forth in
the policy. To the extent that the terms of this Agreement
conflict
with such policy, the terms of the policy shall control.
6.3 Client warrants and represents to
Administaff that it has in force at the
Effective Date of this Agreement, and will
maintain during this Agreement, the
following insurance coverage and minimum
limits. Such coverage shall be provided
at the Client's sole cost and expense and
shall be provided by a state approved
insurance company and rated by A M Best
Company at A- or better.
a. General Liability.
Commercial General Liability coverage in standard
form on an occurrence basis covering Client's operations with
minimum
limits of:
(1) $2,000,000.00 General Aggregate
(2) $1,000,000.00 Products/Completed
Operations Aggregate and/or
Error and Omissions (Malpractice)
(3) $1,000,000.00 Personal and Advertising
Injury
(4) $1,000,000.00 Each Occurrence.
Additional coverage may be required for special operations.
b. Automobile Liability.
Comprehensive automobile liability insurance
covering all owned, hired, and non-owned Client vehicles, with
minimum
limits of One Million and No/100 Dollars ($1,000,000.00)
combined
single limit per occurrence for bodily injury and
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property damage liability. Client warrants that all persons
operating
Client's vehicles are duly licensed and covered under the
Client's
automobile liability insurance policy without exception. Client
agrees
to furnish to Administaff a list of drivers upon request. The
policy
shall be endorsed to include, at no additional cost to
Administaff,
Staff who shall be operating motor vehicles for Client.
c. Workers' compensation
insurance coverage on any of its employees that
are not part of Staff and any Client subcontractor employees.
6.4 Policy Requirements. All Client
insurance policies required herein shall
provide for thirty (30) days written notice
to Administaff prior to cancellation
or non-renewal of the coverage. All such
insurance policies shall be endorsed to
waive any and all rights of subrogation
against Administaff and name Administaff
as an additional insured, both at no
additional cost or expense to Administaff.
Each of the policies shall be primary
insurance and not excess over or
contributory with any other valid, existing
and applicable insurance carried by
Administaff.
6.5 Client shall submit certificates of
insurance to Administaff signed by
authorized representatives of insurance
companies evidencing all insurance
required pursuant to this Article VI within
thirty (30) days of execution of
this Agreement and at any renewal or
replacement of such policies.
6.6 Waiver of Subrogation. Each party to
this Agreement hereby waives any claim
in its favor against the other party by way
of subrogation or otherwise, which
arises during this Agreement, for any and
all liability, loss or damage which is
covered by policies of insurance required
hereunder or covering property, to the
extent that such liability, loss or damage
is recovered under such policies of
insurance. Since the mutual waivers will
preclude the assignment of any
aforesaid claim by way of subrogation or
otherwise to an insurance company or
any other person, each party agrees to
immediately give to each of its insurance
carriers, written notice of the terms of
said mutual waiver, and to have its
insurance policies properly endorsed, if
necessary, to prevent the invalidation
of said insurance coverage by reason of
said waiver.
VII. ENROLLMENT FEE
Client agrees to pay Administaff a
non-refundable enrollment fee in the sum
specified in the initial Schedule B
("Client Service Application"). This one
time enrollment fee is due and payable at
the time the initial Agreement is
signed by Client.
VIII. SERVICE FEE
In exchange for the personnel management
services provided by Administaff,
Administaff and Client agree as
follows:
8.1 The Administaff service fee percentage
("Administaff Service Fee
Percentage") is established for each
employee (Staff) based upon a) information
provided by the Client on Schedule A, b)
federal and state statutory
requirements including taxes and fees, and
c) Administaff's insurance costs, and
professional services and administrative
fees ("Administaff Allocations"). These
Administaff Service Fee Percentages are
reflected in the attached Schedule B
signed by the Client.
8.2 Any changes in the Schedule A
information provided by the Client, including
payroll amount, or additions to Staff, or
individual employee benefit elections,
or workers' compensation codes or location,
and statutory changes required by
law, during the term of the Agreement shall
be reflected in the individual
Administaff Service Fee Percentages as they
occur.
8.3 The Administaff Allocations will only
be adjusted at the end of the first
twelve (12) months of the Agreement and
annually thereafter, with prior written
notice, or as mutually agreed by Client and
Administaff.
8.4 Each pay period Client shall pay
Administaff the total service fee ("Total
Service Fee") comprised of the actual gross
payroll of Staff during such pay
period plus the applicable Administaff
Service Fee Percentage, plus any other
charges related to services provided to
Client including, but not limited to,
medical premiums not collected from Staff
who have not received an Administaff
payroll check. All charges shall be
reflected on the Administaff invoice.
8.5 Any invoice provided under this
Agreement shall be due and payable by Client
upon receipt. Client shall use a method of
payment approved in advance by
Administaff.
8.6 Client shall reimburse Administaff for
services requested by Client not
contemplated by Administaff and not
included as part of the Administaff Service
Fee Percentage. Administaff shall advise
Client if the requested service is an
extra charge.
8.7 Client will notify Administaff of any
changes, errors or inaccuracies in any
payroll, payroll report, Schedule A, or
Schedule B within ten (10) days of such
error or change.
8.8 Administaff reserves the right to
impose any terms of the then current
Administaff credit policy ("Credit
Policy"). A copy of the current policy is set
forth in Exhibit E.
8.9 Each payroll period, Client shall
provide a written report to Administaff of
all time worked by non-exempt Staff, days
worked by exempt-salaried Staff, and
commissioned Staff. Client will accurately
report FLSA classification of all
Staff, pay rate and any overtime worked by
non-exempt Staff.
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8.10 Client agrees to pay Administaff a fee
of $7,500.00 for each Excess Client
COBRA Participant that Administaff provides
benefit coverage pursuant to
eligibility provided under paragraph
3.5(b)(ii) of this Agreement. Additionally,
Client agrees to pay Administaff a fee of
$7,500.00 for each Staff that elects
COBRA continuation coverage under the
Administaff Group Health Plan or its
successor where such election was due to a
Qualifying Event (as defined under
Section 4980B(f)(3) of the Internal Revenue
Code) that occurred during the
period beginning sixty (60) days before the
termination of the Agreement by
either party and ending on the effective
date of the termination of the
Agreement by either party. Any fees due
Administaff pursuant to this paragraph
are due and payable upon receipt of any
invoice from Administaff. The provisions
of this paragraph 8.10 shall survive
termination of this Agreement.
8.11 Client shall pay all fees and fulfill
all of its obligations under both
Exhibit F and applicable 401(k) plan and
trust documents. The provisions of this
paragraph 8.11 shall survive the
termination of this Agreement.
IX. DEFAULT
9.1 Acts of default by Client are:
a. failure of Client to pay an
invoice when due;
b. failure of Client to comply
with any directive of Administaff, when
such directive is promulgated or made necessary by: (i) a
federal,
state or local governmental law or regulation; (ii) an
insurance
carrier providing coverage to Administaff and/or its Staff; or
(iii)
specific circumstances which may affect the safety or violate
the
legal rights of Administaff or Staff;
c. commission or omission of
any act that usurps any material right or
obligation of Administaff as a co-employer of Staff including
failing
to cooperate with Administaff in its fulfilling its obligations
hereunder or violation by Client of any material provision of
this
Agreement;
d. Client has become a credit
risk in Administaff's reasonable
estimation, based on factors which include, but are not limited to,
a
temporary or permanent layoff, solicited time off, or
significant
decrease in Staff or wage rates;
e. filing by or against Client
for bankruptcy, reorganization or
appointment of a receiver, supervisor, assignee, trustee, or
liquidator over its assets or property, Client's failure to meet
any
of its financial covenants, or Administaff's reasonable belief
Client
is insolvent;
f. failure to follow terms of
Administaff's credit policy as stated in
paragraph 8.8 after being given written notice of the failure;
g. failure to cooperate with
Administaff in its fulfilling any of its
obligations under this Agreement after being given notice of
the
failure to cooperate;
h. a material money judgment
against Client which remains unsatisfied for
more than thirty (30) days and has not been appealed;
i. without the prior express
written consent of Administaff, making any
form of press release or announcement to the general public
regarding
this Agreement, publicizing Administaff or using its trade
marks,
and/or service marks, or otherwise disclosing to the general public
in
a public forum that the parties have entered this Agreement or have
a
relationship; or
j. failure to fully and
correctly disclose to Administaff (prior to the
execution of this Agreement) the total number of Client's COBRA
Participants to Administaff where such number of Client's COBRA
Participants exceeds ten percent (10%) of the total number of Staff
as
computed consistent with the methodology set forth in paragraph 3.5
b
(ii) of this Agreement.
9.2 Upon an act of default by Client,
Administaff shall have the option, in its
sole and absolute discretion, of
terminating this Agreement immediately in the
case of a default under paragraphs 9.1a, b,
c, d, e, f, g, i or j or after cure
period provided in paragraph 9.1 h by
written facsimile transmission or any
other method of written communication to
the address stated in paragraph 13.7.
X. INDEMNITY
10.1 Administaff hereby agrees to
indemnify, defend and hold Client harmless
from and against any and all liability,
expense (including cost of
investigation, court costs and reasonable
attorneys' fees) and claims for damage
of any nature whatsoever, whether known or
unknown and whether direct or
indirect, as though expressly set forth and
described herein which Client may
incur, suffer, become liable for, or which
may be asserted or claimed against
Client as a result of Administaff failing
to pay when due wages to Staff,
federal, state and local payroll taxes, if
any, and health insurance premiums in
Administaff sponsored plans for
participating Staff or to secure workers'
compensation insurance coverage for
Staff.
10.2 Notwithstanding anything herein or in
any other agreement or document to
the contrary, Client expressly agrees that
Administaff shall under no
circumstances be liable for any special,
incidental or consequential damages of
any nature whatsoever arising under or
relating to this Agreement.
10.3 Client hereby agrees to indemnify,
defend and hold Administaff,
Administaff, Inc. and all subsidiaries of
or companies affiliated with
Administaff, Inc. by shareholdings or other
means of control, its and their
current and/or former officers, directors,
shareholders, employees and agents
("Administaff Indemnified Parties"),
harmless from and against any and all
liability, or expense (including cost of
investigation, court costs and
reasonable attorneys'
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fees) and claims for damage of any nature
whatsoever, whether known or unknown
and whether direct or indirect, as though
expressly set forth and described
herein, which Administaff Indemnified
Parties may incur, suffer, become liable
for or which may be asserted or claimed
against Administaff Indemnified Parties
with respect to this Agreement, including
but not limited to:
a. relating to any claims,
incidents or causes of action that occurred
prior to the Effective Date of this Agreement, regardless of
whether
the claims, incidents or causes of action were asserted prior to
or
after the Effective Date of this Agreement;
b. as a result of the failure
of Client to follow the directives,
procedures and policies of Administaff as they relate to Staff
which
includes, but is not limited to, claims arising from the acts
or
failures to act of the Client and/or its employees, agents,
former
employees or former agents in accordance with (i) applicable
federal,
state or local laws or (ii) the terms and conditions of this
Agreement;
c. arising from the Client's
actions or omissions toward Staff, or their
rights or terms and conditions of employment, (including but
not
limited to violations under FLSA, OSHA or WARN) or a breach of any
of
its duties under paragraph 3.2 or otherwise subject to coverage,
if
any, under EPLI pursuant to paragraph 6.2 herein;
d. arising from actions of
Staff toward non-employees of Administaff
whether based on contract, tort or statutory violation or under
paragraph 11.2 hereof or arising from non-Staff Client employees
or
contractors;
e. arising from any product
produced and/or services provided by Client;
f. arising from operation by
Client, Client's employees or Staff of any
form or type of motor vehicle and any violation of Department
of
Transportation, Interstate Commerce Commission and/or Motor
Carrier
Act;
g. arising from employee or
Staff unionization and/or provision of
benefits to any Staff member covered by a collective bargaining
agreement, any organizing activity or claims based on NLRA;
h. arising from any Client
employment agreement or offer letter Client
has with Staff, or any policy or plan Client has regarding paid
time
off or other payment plans such as vacation, sick leave,
severance,
bonus or commissions and nothing in this provision creates any
such
policy or plan;
i. arising from any
infringement, alleged infringement, unauthorized use
or alleged unauthorized use of any intellectual property
rights,
including but not limited to patents, trademarks, copyrights,
trade
secrets and confidential information, by Staff or Client and by
any
product or services provided by Client;
j. as a result of the failure
of Client to properly maintain and operate
any separate employee benefit plan(s), including, but not limited
to,
a defined contribution or defined benefit pension plan or a
welfare
plan maintained by Client in accordance with all applicable
federal
and state laws and any accompanying regulatory guidance
thereto,
including, but not limited to, Client or Client's agents failure
with
respect to such plan(s) to make timely deposits to the
appropriate
plan(s) in an amount equal to the Staff requested wage deferral,
to
perform proper discrimination and coverage testing, file
required
annual informational or event specific returns or reports with
the
appropriate regulatory agencies, and timely pay any applicable
premiums or vendor fees; or
k. arising from or in any way
related to any failure by Client, its
affiliates, employees or third parties to comply and/or fulfill
all
obligations or duties under Exhibit F.
10.4 In the event Administaff incurs any
expenses, fines and/or liabilities as a
result of an act of default by Client as
set forth in Article IX or Article X,
Client shall reimburse Administaff for all
actual expenses, fines and/or
liabilities, including, but not limited to,
reasonable attorneys' fees, court
costs and any related expenses as they are
incurred.
10.5 The indemnities in this section shall
be deemed to be contractual in nature
and shall survive termination of this
Agreement.
XI. REPRESENTATIONS, WARRANTIES AND AGREEMENT
11.1 Client agrees not to engage in any
conduct that is, or could be in any way,
inconsistent with the policies and
procedures of Administaff made known to
Client or the fact that the Staff are the
co-employees of Administaff and
Client.
11.2 Client agrees that Administaff will
have no responsibility or liability for
any losses or claims that arise as a result
of Staff's negligence, theft,
embezzlement, or other unlawful or willful
acts committed by Staff.
11.3 Client agrees to comply with all
applicable Department of Transportation,
Interstate Commerce Commission and Motor
Carrier Act requirements and
regulations if Client uses Staff to operate
motor vehicles.
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11.4 Client agrees to provide Administaff
with a copy of any notice, complaint
or charge of a government agency and/or
legal action concerning (i) Client's
workplace; (ii) Client's compliance with
any laws, rules, regulations or
ordinances relating to the workplace; or,
(iii) any Staff within five (5) days
of its becoming aware of such notice,
complaint, charge or legal action via
facsimile transmission to 281.348.3118
Attn: EEO Compliance.
11.5 Client agrees to notify Administaff in
advance if it has executed a
collective bargaining agreement, is in the
process of negotiating a collective
bargaining agreement, experiencing
organizing activities, or has any employees
represented by a union.
11.6 Client acknowledges that any and all
employee benefit plans maintained by
Administaff may be amended, modified or
terminated at any time at the sole
discretion of Administaff or its
affiliates. Such modifications include but are
not limited to, increases or decreases of
participant co-pays, deductibles, out
of pocket maximums, covered services, and
the like and such modifications shall
not be restricted as a result of any
provision(s) contained in a collective
bargaining or other agreement entered into
by Client.
11.7 In the event Client files a voluntary
petition under Title 11 of the United
States Code, or in the event that an
involuntary petition is filed against
Client under Title 11, all debts that the
Client may owe to Administaff shall be
considered "administrative expenses" within
the meaning of 11 U.S.C. Section 503
(b)(l)(A) and Administaff's claim or claims
for such administrative expenses
shall be entitled to the priority specified
in 11 U.S.C. Section 507 (a) (1).
Client further agrees to use every effort
and cooperate with actions which will
so classify these claims as
administrative.
11.8 Client agrees to cooperate fully with
Administaff in any investigation
including, but not limited to, the defense
of any employment-related claim,
involving Staff whether such investigation
or claim is initiated by Staff, a
government agency or by Administaff.
11.9 Client warrants and represents that
all individuals it has represented to
Administaff as Staff are: (i) its employees
and (ii) included in the personnel
management services of Administaff
including receiving wages and coverage under
insurance and benefit plans.
11.10 Client warrants and represents to
Administaff that, prior to entering into
this Agreement, Client has informed
Administaff of all compensation, pension
and/or benefit plans that Client may
currently provide, or has heretofore
provided, for any owners, partners,
shareholders, directors, officers, employees
or agents of Client. Client acknowledges
that if Client currently provides or
has previously provided any pension or
benefit plans to such individuals or
their dependents, certain complex rules
under ERISA and the Internal Revenue
Code may apply to these plans, as well as
to any plans maintained by
Administaff, as a result of this Agreement.
If Client currently maintains or has
maintained any such plans, Client
acknowledges that Administaff has advised
Client to seek advice from a qualified
professional regarding the effect of this
Agreement on such plans. Client further
warrants and represents to Administaff
that it has fully disclosed to Administaff
the total number of individuals to
whom it has any COBRA responsibilities as
of the date of execution of this
Agreement.
11.11 Client warrants and represents to
Administaff that prior to entering into
the Agreement, it has not engaged to the
best of its knowledge in any violations
of federal, state or local laws or
regulations regarding wage and hour, unfair
labor practices or discrimination and that
Client is current on the payment of
all wages, payroll taxes, and workers'
compensation assessments and penalties,
if applicable.
11.12 Client acknowledges that at the time
of termination of this Agreement,
Administaff will send Staff employment
termination notices terminating
Administaff's relationship with Staff which
will not affect the employment
relationship Client has with Staff.
11.13 Upon termination of this Agreement,
Client will retain sole responsibility
and liability for all accumulated unpaid
sick leave, paid time off, vacation or
similar liabilities for Staff.
11.14 Client agrees to notify Administaff
in advance if it owns or operates
aircraft or watercraft or has any foreign
operations or expatriates.
11.15 Client warrants it will not request
Staff to perform any services outside
that person's workers' compensation code or
employee's ability or training if
such service would expose the individual,
Staff or other persons to injury.
11.16 Client agrees that it will not during
this Agreement and for a period of
one (1) year following its termination,
solicit or hire any corporate employee
of Administaff or in any way induce an
Administaff corporate employee to
terminate his/her employment. If Client
does employ for itself, or for its
benefit, any corporate employee of
Administaff, it will pay within thirty (30)
days of written notice from Administaff a
recr
