SUBCONTRACT AGREEMENT
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This Agreement is Entered into this
7th day of June, 1996
between
NETWORK SIX, INC.
a Rhode Island Corporation
with offices at 475 Kilvert Street, Warwick, RI 02886
(hereinafter referred to as "NSI")
and
COMPLETE BUSINESS SOLUTIONS, INC.
with offices at
32605 W. Twelve Mile; Suite 250
Farmington Hills, MI 48334
(hereinafter referred to as "CBSI")
WHEREAS, NSI desires to retain the services of CBSI as specified by the
attached subcontractor Statement of Work, and
WHEREAS, CBSI desires to render certain services to NSI, as specified by
the attached subcontractor Statement of Work,
NOW, THEREFORE, in consideration of the mutual covenants hereinafter
contained, NSI and CBSI hereby agree as follows:
1. CBSI agrees to carry out all work in good faith and in accordance with
the Statement Of Work (Attachment A) and in relation to the time
frames specified in the Statement Of Work. CBSI agrees not to assign
its rights hereunder or any interest herein without the written
consent of NSI.
2. NSI shall provide evidence to CBSI, in the form of a letter signed by
the State of Hawaii and NSI attached hereto as Attachment D, that the
State of Hawaii has accepted the following irrevocable payment
instructions:
NSI shall be responsible for invoicing the State Of Hawaii on behalf
of CBSI and for securing tidy payment for CBSI directly tom the State
of Hawaii under this subcontract Payment shall be made in the amounts
and on the dates (assuring the completion of deliverables) set forth
in the Statement Of Work Section XI. Invoices shall indicate that the
State of Hawaii shall designate NSI us the payee and payment shall be
made either by check to the following address:
Complete Business Solutions, Inc.
32605 W. Twelve Mile Road, Suite 250
Farmington Hills, MI 48334
Attn: Tim Manney
or by wire transfer to NBD Bank, Account #3776084. NSI understands and
agrees that such invoice payments will be deposited into NBD Bank,
Account #3776084 in accordance wit the banking resolution set forth
herein as
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Attachment C. If payments are made in accordance with the above
payment instructions, NSI shall be in default, subject to the notice
provisions of this agreement, for failure to meet the payment
obligations.
3. NSI will assign seven (7) qualified NSI employees to assist CBSI in
completing the Statement of Work. CBSI agrees to utilize each of the
NSI employees for 40 hours per week for the duration of the work. In
the event NSI personnel are not performing in the judgment of the
CBSI manager, such personnel shall be removed. NSI will have two (2)
weeks to find a replacement. NSI will invoice CBSI semi-monthly for
services based an actual hours worked and at the following rates:
a) Subsystem Team Leads (3) $90.00/hr
b) System Analysts (2) $65.00/hr
c) Analyst Designers (2) $65.00/hr
d) Office Manager (1) $40.00/hr
e) Administrative Assistant (1) $10.00/hr
CBSI will pay NSI invoices based OK approved timesheets within ten
(10) day. of the invoice date. Timesheets will be deemed to be
approved unless objected to in writing to NSI within two (2) business
days of their submission.
4. CBSI will also pay to NSI an overhead charge totaling $59,363 which
will be paid at the completion by CBSI of the work set forth in the
Statement of
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Work. If the work is not completed on time and within budget, the
amount of this overhead charge will be reduced to an amount negotiated
by CBSI and NSI.
5. NSI personnel assigned to this subcontract will complete and submit to
CBSI a weekly timesheet by the Monday- following each week in which
work on assigned tasks occurs. The timesheet must be approved by the
CBSI project manager.
6. CBSI personnel assigned to this subcontract will perform their
assigned tasks at the NSI project development facility in Honolulu,
Hawaii. CBSI shall pay NSI a facilities fee of $156,000, payable in
arrears in four (4) monthly installments of $39,000 commencing June
15, 1996 and NSI shall provide the following facilities, workspace and
equipment for CBSI employees as currently available at 650 Iwilei
Road, Suite 400, 89 well as all building maintenance and office
supplies necessary for CBSI employees to perform their work:
a) Existing office space and furniture
b) Existing PC workstations, servers and cabling
c) Existing telephone, fax, mail delivery and copying services.
CBSI will designate one individual to serve as NSI's primary -point of
contact.
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7. This agreement shall be effective upon receipt by NSI of a Notice to
Proceed by the State of Hawaii on the statement of Work (and approval
by the State of Hawaii of this subcontract between NSI and CBSI) and
shall remain in effect for the period sent forth in the Statement of
Work.
Either party, upon giving written notice to the other party, may
terminate this agreement:
i. if the other party or its employees, consultants or other
agents violate any material provision of this subcontract (which shall
include but not be limited to failure to timely make payment, which
shall extend to the obligation of the State of Hawaii to timely make
payment to CBSI in accordance with the payment provisions of this
subcontract) and the violation is not remedied within thirty (30) days
of the party's receipt of written notice of the violation (or remedied
within five (5) days in the case of failure to make timely payment);
and/or
ii. at any time in the event the other party terminates or suspends
its business, files for bankruptcy, is dissolved, goes into
liquidation, has a receiver appointed over any of its assets or
otherwise files for protection from under U.S. bankruptcy laws.
8. CBSI agrees to provide qualified technical and management personnel
with sufficient related experience to complete the Statement of Work.
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9. NSI and CBSI agree that CBSI's status in rendering service to the
terms hereof shall be that of independent contractor and not of an
employee or agent of NSI. CBSI further agrees to carry adequate public
liability and other appropriate forms of insurance.
10. CBSI shall maintain books, records, and documents in accordance with
accounting procedures and practices which sufficiently and properly
reflect all expenditures of funds provided by NSI under this contract.
11. CBSI shall assure that these records shall be subject at all times to
inspection, review, or audit by State personnel and other personnel
duly authorized by the CSEA, as well as by federal personnel.
12. CBSI shall retain all financial records, supporting documents,
statistical records, and any other documents pertinent to the
subcontract contract for a period of five (5) years after termination
of this subcontract, or if an audit has been initiated and audit
findings have not been resolved at the end of five (5) years, the
records shall be retained until resolution of the audit findings.
13. CBSI agrees to keep in confidence any confidential or proprietary data
relative to NSI business to which it may be given access, and to
return to NSI such
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materials as have been made available to CBSI in the course of its
services as subcontractor, whether proprietary or not.
14. During the period of this subcontract and for one year thereafter,
CBSI will not engage in negotiations with the Hawaii Child Support
Enforcement Agency (CSEA) or any other party for the purposes of
securing contracts, independent of NSI, which are directly related or
follow-on efforts to the requirements of this subcontract or to NSI's
contract with Hawaii for the KEIKI project, without the written
consent of NSI which shall not be unreasonably withheld. CBSI's
obligations under this paragraph 14 shall terminate in the event that
NSI breaches this Agreement or in the event that NSI has not paid in
full the past due balance stated in paragraph 19 on or before
September 30, 1996.
15. CBSI warrants that if CBSI refers to the KEIKI project in future
proposals, when describing CBSI firm qualifications, that CBSI will
clearly state CBSI was a "subcontractor to NSI" in this project.
16. In the event the NSI contract on which CBSI is working is
terminated for convenience of the government, lack of funds, or for
default, this subcontract agreement will also be terminated.
Notification to CBSI of such termination shall be provided by
telephone and confirmed in writing as promptly as practicable after
receipt by NSI. NSI shall be liable to CBSI for all sums
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owing on all deliverables per the Statement of Work, other than those
in connection with any claimed breach on the part of CBSI by NSI. In
the event a payment deliverable is not complete, fees shall be
determined on a basis consistent with NSI's contract with the State of
Hawaii.
17. CBSI agrees to the applicable terms and conditions of NSI's contract
with the State of Hawaii which are incorporated in this agreement as
Attachment B.
18. In the event of a dispute over the subcontract, the laws of the State
of Rhode Island shall prevail.
19. These terms and conditions will supersede the Subcontract Agreement
dated May 16, 1994 between CBSI and NSI, provided however that all
sums owing under that prior contract remain due and owing. The
parties expressly agree that the amount owing is $489,740.56 as of
March 31,1996 and in consideration of ibis Agreement NSI waives any
and all defenses to such obligation and any and all rights of set-off.
20. Any modification to these terms and conditions must be in writing and
signed by authorized representatives of NSI and CBSI.
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IN WITNESS WHEREOF, NSI and CBSI have entered this Agreement to be enacted
as of the date first written above.
NETWORK SIX, INC. COMPLETE BUSINESS SOLUTIONS, INC.
By: /s/ Kenneth C. Kirsch By:/s/ Tim Manney
Title: /s/ President & CEO Title: /s/ Chief Financial Officer
Witness: /s/ Dorothy M. Copolla Witness: /s/
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