<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 29, 2000
REGISTRATION NO.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-1
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
------------------------
DYNACS INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
DELAWARE 8731 59-2521756
(STATE OR JURISDICTION (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
OF INCORPORATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
</TABLE>
------------------------
35111 U.S. HIGHWAY 19 NORTH, SUITE 300
PALM HARBOR, FL 34684
(727) 787-1245
(ADDRESS AND TELEPHONE NUMBER OF PRINCIPAL EXECUTIVE OFFICES AND PRINCIPAL PLACE
OF BUSINESS)
------------------------
DR. RAMENDRA P. SINGH, PRESIDENT
DYNACS INC.
35111 U.S. HIGHWAY 19 NORTH, SUITE 300
PALM HARBOR, FL 34684
(727) 787-1245
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
------------------------
COPIES TO:
<TABLE>
<S> <C>
GARY A. SCHONWALD, ESQ. RUBI FINKELSTEIN, ESQ.
FRANKFURT, GARBUS, KLEIN & SELZ, P.C. ORRICK, HERRINGTON & SUTCLIFFE, LLP
488 MADISON AVENUE 666 FIFTH AVENUE
NEW YORK, NY 10022 NEW YORK, NY 10103
(212) 980-0120 (212) 506-5000
</TABLE>
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the effective date hereof.
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
check the following box. [ ]
------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE AGGREGATE OFFERING AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED PER UNIT(1) PRICE(1) REGISTRATION FEE
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.01 par value(2)..... 2,875,000 $11.00 $31,625,000 $8,349.00
- ---------------------------------------------------------------------------------------------------------------------------------
Representatives' Warrants(3)........ 250,000 $13.20 $ 3,300,000 $ 871.20
- ---------------------------------------------------------------------------------------------------------------------------------
Common Stock, $.01 par
value(4)(5)....................... 250,000 (6) (6) (6)
- ---------------------------------------------------------------------------------------------------------------------------------
Total............................... -- -- $34,925,000 $9,220.20
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for the purposes of calculating the registration fee in
accordance with Rule 457(o) under the Securities Act of 1933, as amended.
(2) Includes a maximum of 375,000 shares that may be purchased by the
underwriters to cover over-allotments, if any.
(3) Issued to the Representatives of the underwriters.
(4) Issuable upon the exercise of the Representatives' Warrants.
(5) Pursuant to Rule 416, this Registration Statement also covers an
indeterminable number of additional shares of Common Stock issuable as a
result of any future anti-dilution adjustments in accordance with the terms
of the Representatives' Warrants.
(6) Pursuant to Rule 457(g), no additional registration fee is required for
these shares of Common Stock.
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED.
WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS
PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IS NOT
SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE
OFFER OR SALE IS NOT PERMITTED.
Subject to completion, dated March 29, 2000.
2,500,000 SHARES
DYNACS INC.
COMMON STOCK
Dynacs Inc. is offering 2,500,000 shares of its common stock in an initial
public offering. Prior to this offering, there has been no public market for
Dynacs' common stock.
At the request of Dynacs, the underwriters have reserved at the initial
public offering price up to shares of common stock for sale to
employees, customers and other business associates of Dynacs.
It is anticipated that the public offering price will be between $9.00 and
$11.00 per share. We have applied for listing of the common stock on the Nasdaq
National Market under the symbol DNAC.
The underwriters have 45 days from the date of this prospectus to exercise
an option to purchase up to 375,000 additional shares of common stock from
Dynacs at the public offering price, less underwriting discounts and fees, to
cover over-allotments, if any.
SEE "RISK FACTORS" BEGINNING ON PAGE 8 FOR FACTORS YOU SHOULD CONSIDER
BEFORE INVESTING IN SHARES OF DYNACS.
-------------------------
<TABLE>
<CAPTION>
PER SHARE TOTAL
--------- -----
<S> <C> <C>
Public offering price.....................
Underwriting discounts and fees...........
Proceeds, before expenses, to Dynacs......
</TABLE>
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES, OR DETERMINED IF
THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The underwriters expect delivery and payment for the shares will be on
, 2000.
-------------------------
H. C. WAINWRIGHT & CO., INC. ROTH CAPITAL PARTNERS, INC.
-------------------------
Prospectus dated , 2000.
<PAGE> 3
DESCRIPTION OF INSIDE FRONT COVER GRAPHIC:
The graphic at the top center of the page depicts Dynacs Inc.'s logo,
"Dynacs," with the tag line "Digital Studios". Below this are 3 black and white
and 3 color, single frame images of video material: 2 images (1 black and white,
1 color) from the television series "Bewitched", 2 images (1 black and white, 1
color) from the television series "I Dream of Jeannie" and 2 images (1 black and
white, 1 color) from historical film footage depicting Roosevelt, Churchill and
Stalin. These images depict examples of the work the company performs in
converting black & white video material to color video material. To the
upper-left of these images are the words "From Black & White..." and to the
lower-right of these images are the words "...to Color" and "Digital Color
Re-mastering."
The graphic at the center-right of the page is an image from the animated
short "Monkey Love" which depicts an example of Dynacs' work in providing
digital services related to the production and restoration of animated cartoons.
To the left of this image are the words "Digital Ink & Paint" and directly below
the image are the words "Digital Cartoon Restoration."
The graphics at the lower-left of the page are two images: the first is a
single frame image from a "Gatorade" commercial and the second a single frame
image from an episode of the television series "The X-Files." These images
depict examples of Dynacs' work providing digital color special effects for
television series, commercials and music videos. Next to these images are the
words "Digital Color Special Effects for Television Series, Commercials and
Music Videos."
At the lower-center portion of the page is an image of Dynacs Inc.'s logo
for its web site www.MarketYourMedia.com. The logo consists of an image of a
television directly to the left of the words "marketyourmedia.com." Directly
below this logo are the words "Enabling the Digital Video Future."
DESCRIPTION OF INSIDE BACK COVER GRAPHIC:
The graphic at the top center of the back inside cover of the prospectus
depicts the Dynacs Inc.'s logo with, "Dynacs," the tag line "Information &
Applied Technology." Below the logo is an artistic rendering of the
International Space Station in orbit. To the upper-left of this image are the
words "Internet Enablement"; "Information Systems Development"; "Website
Database Design & Implementation"; and "Information Systems Sustaining
Engineering." To the lower-right of this image are the words "Systems
Integration"; "Simulation & Modeling"; "Satellite Systems & Operations"; and
"Spaceflight Hardware and Software."
In the center of the page is an image representing Dynac's on-going efforts
in the commercialization of technologies utilized in the performance of its
contracts with NASA. The image graphically depicts the multi-colored
computational fluid dynamic (CFD) solution of the aerodynamic flow field of a
wing of an aircraft and a tractor trailer cab. Within this image are the words:
"Application of Aerospace Technology in the Private Sector"; "NASA High Speed
Research Program CFD Solution for HSR Ref H Configuration"; "CFD Analysis of
Truck Vehicle Performance."
To the lower-left of this image is an image depicting the interior of the
launch control center at the NASA Kennedy Space Center and is representative of
the work Dynacs performs in the development of launch control systems and space
vehicle mission control systems.
To the right of this is an image of a computer screen entitled "Database
Structure Module Hierarchy." This image is representative of the information
technology products and services the Company provides its clients.
In the lower-right area of the page are three rectangles ordered left to
right from smallest to largest with an upwardly sweeping arrow behind the three
rectangles. The three rectangles and arrow depict the growth of technologies and
technical competencies within Dynacs. The smallest rectangle is entitled "1985"
and contains the following words: "Dynamics"; "Modeling & Simulation"; "3D/2D
Visualization"; "Computer Graphics"; "Control Systems"; and "Guidance &
Navigation" and has the word "Technology" going down the left side of the
rectangle. The center rectangle contains the following words: "Smart
Structures"; "Vibration Control"; "LaserImaging"; "Structural Dynamics";
"Pointing & Shape Control"; "Computational Mechanics"; and "Combined Structure &
Control Design" and has the word "Technology" going down the left side of the
rectangle. The largest rectangle is entitled "2000" and contains the following
words: Information Technologies"; "Computer Science Technologies"; "Internet
Infrastructure -- Design & Dev."; "Technical/Business Re-engineering";
"Programming & SW Development"; "Graphic & Information Design"; "Real-time Video
& Audio Servers"; "Client-Data Server Technologies"; "Digital Special Effects
Technologies"; "Automatic Source Code Generation"; "Autonomous & Intelligent
Systems"; "Applied Technologies"; "Project Management Technologies"; "System and
Subsystem Engineering"; "Space Propulsion Technologies"; "Combustion Analysis &
Flow Fields"; "Operations Software & Systems"; "Hardware Fabrication and Test";
"Computational Fluid Dynamics"; "Commercial Aircraft Technologies";
"Experimental Aerodynamics"; "Digital Media Storage Systems"; and "Medical
Diagnostics & Imaging" and has the word "Technology" going down the left side of
the rectangle.
<PAGE> 4
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
Prospectus Summary.......................................... 1
Risk Factors................................................ 8
Use of Proceeds............................................. 16
Dividend Policy............................................. 18
Capitalization.............................................. 19
Dilution.................................................... 20
Selected Consolidated Financial Data........................ 21
Management's Discussion and Analysis of Financial Condition
and Results of Operations................................. 22
Business.................................................... 35
Management.................................................. 51
Principal Stockholders...................................... 56
Certain Transactions........................................ 58
Description of Securities................................... 60
Shares Eligible for Future Sale............................. 64
Underwriting................................................ 67
Legal Matters............................................... 70
Experts..................................................... 70
Available Information....................................... 70
</TABLE>
Information contained in Dynacs' web sites, www.dynacs.com and
www.MarketYourMedia.com, shall not be deemed to be a part of this Prospectus.
<PAGE> 5
PROSPECTUS SUMMARY
You should read the following summary together with the more detailed
information and Dynacs' financial statements and the notes to those statements
appearing elsewhere in this prospectus.
In this prospectus,"Dynacs," the "Company," "we," "us" and "our" refer to
Dynacs Inc. and its subsidiaries, and the Securities Act of 1933, as amended, is
referred to as the "Securities Act."
References in this prospectus to backlog include funded and unfunded
backlog. Funded backlog consists of the dollar amount of contracts in our
information systems and aerospace/satellite systems and operations business that
is currently appropriated by the customer and allocated to the contract or
otherwise authorized for payment upon completion of a particular portion of the
work. Unfunded backlog consists of the full contract award value of these
contracts and includes renewals or extensions that have been priced but as to
which the customer retains funding discretion. References in this prospectus to
the term of any contract include the basic term and the term of any option
periods, whether or not the relevant options have been exercised.
OUR BUSINESS
We develop advanced technologies in the areas of information systems and
aerospace/satellite systems and operations for U.S. Government agencies and
private sector clients. Our business strategy is to develop commercial
applications for the technologies and know-how developed by us in our
information and aerospace businesses to create and grow new businesses with
strong profit potential. To date, the most significant commercial applications
of our proprietary technologies have been our digital color re-mastering and
digital masking technologies which our Media and Entertainment Division use to
colorize short-form and long-form black-and-white film footage and other media
into digital color material. To further this strategy, we have spent over $4.0
million in the twelve-month period ended December 31, 1999 to build the
infrastructure to grow our digital media and entertainment business, including
the development of digital remastering production tools and upgrading existing
facilities. As part of our media and entertainment business expansion, we began
in 1998 to acquire for our own account, directly and through joint projects,
media products for colorization, while continuing to provide work-for-hire
colorization services. We believe that we are the leading provider of
cost-effective processes to convert large volumes of black-and-white films and
other media into digital color material. Our clients for these services include,
among others, The Walt Disney Company and Columbia Pictures Television Group, a
division of Sony Corporation. We also intend to leverage our information and
digital server technologies to develop Internet-based distribution and
business-to-business and business-to-consumer delivery of digital media products
and services through our MarketYourMedia.com web site.
For the twelve-month period ended December 31, 1999, our gross revenues
exceeded $72.9 million, of which $71.3 were attributable to information systems
and aerospace/satellite systems and operations contracts. At December 31, 1999,
our total contract backlog with customers in our information systems and
aerospace/satellite systems and operations business was $207.9 million. Of this
amount, $34.9 million represented funded backlog and $173.0 million represented
unfunded backlog.
OUR CORE TECHNOLOGIES
Our information systems, aerospace and media businesses each utilizes one
or more of our core technologies. Our core technologies include:
- 3-D VISUALIZATION AND ANIMATION TECHNOLOGIES, USED TO REPRESENT STILL AND
MOVING OBJECTS FOR THE AEROSPACE AND MEDIA INDUSTRIES. For example, under
our $173.6 million, five-year contract
1
<PAGE> 6
for NASA's Kennedy Space Center ending September 30, 2002, our services
include multimedia development and training, computer graphics and
animation, and web site development and implementation services.
- DIGITAL IMAGE PROCESSING AND IMAGE MANIPULATION TECHNOLOGIES USED TO
VISUALIZE AND ENHANCE IMAGES. For example, under our $2.9 million,
63-month contract with the U.S. Air Force Phillips Laboratory ending
December 31, 2001, we have developed techniques to improve laser imaging
of objects in space.
- DESIGN, SIMULATION AND MODELING OF THREE-DIMENSIONAL OBJECTS IN MOTION,
SUCH AS SATELLITES AND OTHER SPACECRAFT, MOTOR VEHICLES, AND SAILBOATS.
For example, under our five-year, $3.5 million contract with NASA ending
September 30, 2000, we are developing spacecraft dynamics models for the
Johnson Space Center.
- INTERNET ENABLING AND DIGITAL SERVER TECHNOLOGIES USED IN THE MANAGEMENT
OF INFORMATION SYSTEMS AND PROCESSES. For example, under our seven-year,
$64.6 million subcontract with The Boeing Company ending September 30,
2001, we are integrating certain information systems for NASA's
International Space Station.
- SATELLITE OPERATING SOFTWARE. For example, we are developing software to
operate satellite systems under our 54-month, $5.3 million contract
ending March 31, 2001 with TRW Inc.
DIGITAL MEDIA AND ENTERTAINMENT
We developed our digital media and entertainment business based on the same
information management, visualization technologies and know-how initially
developed by us for the aerospace industry. We believe that we are the leading
provider of cost-effective technologies and services for converting
black-and-white feature films, television series, and other media, such as
cartoons and television commercials, into high quality, digital color material.
Through the use of our advanced proprietary technologies and our low cost
overseas production facilities, we believe that we are able to provide clients
with a realistic and aesthetically pleasing product on a faster production
schedule and a more cost-effective basis than other currently available methods.
We have also developed technologies for converting visual media into material
for high definition television. To date, we have completed film and television
projects for The Walt Disney Company, Sony Corporation and others, and have also
created special color effects for commercials, music videos and documentaries.
MARKETS
According to Dataquest, the commercial market for the type of services that
we can provide in the area of information systems management and development is
expected to grow from $177.0 billion in 1998 to $291.0 billion in 2001. We
believe that this substantial growth will result from the increasing dependency
of businesses and governmental agencies on information technologies and the
trend toward outsourcing of these services, which is particularly acute for
companies whose information technology personnel lack the requisite skills and
abilities to implement new technologies.
The commercial markets for the type of services that we can provide in the
area of aerospace/satellite systems and operations are expected to grow to $81.1
billion worldwide between 2000 and 2009, according to the Teal Group
Corporation. The anticipated market demand reflects the dramatic growth
projected in the global communications and information industry and the
availability of new supporting technologies.
Currently, the primary focus of our media and entertainment business is the
world-wide market for digitally re-mastered black-and-white television
programming with an initial emphasis on family,
2
<PAGE> 7
children's and documentary programming. This market constitutes only a portion
of the commercial markets for all television programming.
GROWTH STRATEGY
We intend to grow our business by:
- expanding our work in the field of digital media and entertainment by
acquiring, colorizing and distributing libraries of black-and-white
television series, feature films and stock footage to network and cable
television and for broad-band Internet presentation;
- developing an on-line digital library and marketplace, under the name
"MarketYourMedia.com," for the distribution of visual digital and other
media content;
- expanding our work in digital film restoration, animation, and digital
ink and paint;
- identifying and pursuing further commercial applications of technologies
and know-how which we have developed in our work, which may include joint
ventures with or acquisitions of companies in related businesses; and
- continuing to provide services to U.S. Government agencies on projects
with high visibility as a means of developing new technologies and
enhancing our reputation.
3
<PAGE> 8
THE OFFERING
<TABLE>
<S> <C>
Shares offered by Dynacs............... 2,500,000 shares
Shares to be outstanding after this
offering............................. 8,556,847 shares
Use of proceeds........................ - Acquisition of rights in media assets
- Repayment of line of credit
- Expand and upgrade U.S. and overseas
facilities and equipment and build new
U.S. and overseas facilities
- Repay long-term debt
- Hire additional marketing, technical and
production personnel
- Research and development
- Marketing
- Working capital and general corporate
purposes
See "Use of Proceeds."
Proposed NASDAQ National Market
symbol............................... DNAC
</TABLE>
The information throughout this prospectus gives effect to a 1,750-to-one
stock split of our common stock on August 11, 1999 and a 1.12299-to-one stock
split on March 28, 2000.
Unless otherwise specifically stated, information throughout this
prospectus assumes:
- an initial public offering price of $10.00 per share;
- no exercise of the underwriters' over-allotment option, the underwriter
representatives' warrants or other outstanding options and warrants;
- the automatic conversion, at the effective date of this offering, of the
equity interest of certain parties in our subsidiary, Cerulean FXs, Inc.,
into 701,588 shares of our common stock;
- that the holders of Bridge Notes issued in connection with our Bridge
Financings have not elected to convert their Bridge Notes into an
aggregate amount of 483,334 shares of our common stock;
- no additional issuance of shares or options under our 1999 Long-Term
Incentive Plan; and
- reincorporation of Dynacs in Delaware in February 2000.
We have excluded the following shares in calculating the number of shares
of common stock that will be outstanding after the completion of this offering,
- 483,334 shares of common stock issuable upon the conversion of unsecured
promissory notes (the "Bridge Notes") issued in connection with our
November 1999 and January 2000 and February and March 2000 bridge
financings (collectively, the "Bridge Financings");
- 488,500 shares of common stock issuable upon the exercise of warrants
issued to the holders of the Bridge Notes;
- 48,334 shares of common stock issuable upon the exercise of warrants
issued to H.C. Wainwright & Co., Inc., a representative of the
underwriters in this offering, in consideration for services rendered as
placement agent of the Bridge Financings (the "Placement Agent
Warrants");
4
<PAGE> 9
- 196,523 shares of common stock issuable upon the exercise of options at
$.02 per share reserved for issuance;
- 361,606 shares of common stock that will be issuable upon the exercise of
options we intend to issue upon the consummation of this offering to our
employees under our 1999 Long-Term Incentive Plan at an exercise price
equal to the initial public offering price of the common stock per share;
- 196,523 shares of common stock that will be issuable upon the exercise of
options we intend to issue upon the consummation of this offering to
certain parties under our 1999 Long-Term Incentive Plan at an exercise
price equal to the initial public offering price of the common stock per
share in connection with our acquisition in August 1999 of Cerulean
Colorization L.L.C.;
- 39,305 shares of common stock that will be issuable upon the exercise of
options we intend to issue upon the consummation of this offering to a
director-nominee under our 1999 Long-Term Incentive Plan at an exercise
price equal to the initial public offering price of the common stock per
share in connection with our acquisition of Cerulean Colorization L.L.C.,
subject to meeting certain performance targets;
- 63,636 shares of common stock issuable to director-nominees and
consultants upon the exercise of options we intend to issue pursuant to
our 1999 Long-Term Incentive Plan at an exercise price equal to the
initial public offering price of the common stock per share;
- 250,000 shares of common stock that will be issuable upon the exercise of
warrants we intend to grant to the representatives of the underwriters of
this offering in consideration for services rendered; and
- 375,000 shares of common stock issuable upon the exercise of an option we
intend to grant to the underwriters upon the consummation of this
offering to cover over-allotments, if any, in this offering.
5
<PAGE> 10
SUMMARY CONDENSED CONSOLIDATED FINANCIAL INFORMATION
The following table presents summary condensed consolidated financial
information with respect to Dynacs and has been derived from (1) the audited
financial statements of Dynacs for the nine-month period ended September 30,
1999, and for the fiscal years ended December 31, 1998 and 1997, included
elsewhere in this prospectus, and (2) the unaudited financial statements of
Dynacs for the nine-month period ended September 30, 1998 and the three-month
periods ended December 31, 1999 and 1998. You should note that in 1999, we
changed our fiscal year from a calendar year to a year ending September 30, with
the result that our 1999 fiscal year consists of nine months. The information
set forth below should be read in conjunction with "Selected Consolidated
Financial Data", "Pro Forma Consolidated Financial Statements", "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
Dynacs consolidated financial statements and the notes thereto, included
elsewhere in this prospectus.
<TABLE>
<CAPTION>
YEAR ENDED NINE MONTHS ENDED
DECEMBER 31, SEPTEMBER 30,
------------------------- ---------------------------------------
PRO FORMA
1997 1998 1998 1999 1999(1)
----------- ----------- ----------- ----------- -----------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENT OF
OPERATIONS DATA:
Total Revenues........... $26,960,839 $60,946,686 $42,791,452 $55,295,085 $56,860,352
Operating Income
(Loss)................. 491,822 277,505 745,801 (2,447,265) (1,603,326)
Net Income (Loss)........ 263,533 41,016 342,107 (1,606,411) (2,723,670)
Diluted Net Income (Loss)
per share.............. 0.03 0.01 0.04 (0.30) (0.38)
Diluted Weighted Average
Common and Common
Equivalent Shares...... 7,860,930 7,860,930 7,860,930 5,398,778 7,144,920
<CAPTION>
THREE MONTHS ENDED
DECEMBER 31,
---------------------------------------
PRO FORMA
1998 1999 1999(1)
----------- ----------- -----------
(UNAUDITED) (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C>
CONSOLIDATED STATEMENT OF
OPERATIONS DATA:
Total Revenues........... $18,155,234 $17,630,259 $17,630,529
Operating Income
(Loss)................. (468,296) (56,953) (125,753)
Net Income (Loss)........ (301,091) (209,680) (144,164)
Diluted Net Income (Loss)
per share.............. (0.06) (0.04) (0.02)
Diluted Weighted Average
Common and Common
Equivalent Shares...... 4,913,081 5,355,259 7,260,742
</TABLE>
<TABLE>
<CAPTION>
DECEMBER 31, 1999
---------------------------------------------
PRO FORMA
ACTUAL PRO FORMA(1) AS ADJUSTED(2)
----------- ------------ --------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C>
CONSOLIDATED SELECTED
BALANCE SHEET DATA:
Working Capital............................................. $(4,467,144) $ 2,384,636 $17,429,030
Total Assets................................................ 12,264,440 16,209,427 31,253,821
Long-Term Debt (including current portion).................. 3,140,277 90,264 90,264
Total Stockholders' Equity.................................. 1,256,595 11,600,653 26,645,047
</TABLE>
- -------------------------
(1) Pro forma gives effect to certain pro forma adjustments including (i) the
issuance of the Bridge Notes, (ii) the use of certain net proceeds of this
offering, (iii) the issuance of common stock to the sellers of Cerulean
Colorization, L.L.C., (iv) the paydown of long-term debt by Dynacs Inc.
prior to this offering and (v) the revaluation of the Bridge Notes issued
prior to December 31, 1999 upon the consummation of this offering. See the
Pro Forma Consolidated Financial Statements and the notes thereto for a
description of the pro forma adjustments.
(2) Adjusted to reflect the consummation of the offering and the application of
the estimated net proceeds by Dynacs therefrom. See "Use of Proceeds" for a
further description of the application of the net proceeds from this
offering.
6
<PAGE> 11
THE COMPANY
We were organized in the State of Florida in April 1985 and reincorporated
in the State of Delaware in February 2000. Our principal executive offices are
located at 35111 U.S. Highway 19 North, Suite 300, Palm Harbor, FL 34684, and
our telephone number is (727) 787-1245. We maintain World Wide Web sites at
www.dynacs.com and at www.MarketYourMedia.com. Any reference to our web sites
does not constitute incorporation by reference of the information contained
therein.
7
<PAGE> 12
RISK FACTORS
This offering involves a high degree of risk. You should carefully consider
the risks described below, in addition to the other information included in this
prospectus, including the financial statements and notes thereto, before you
decide whether to buy our common stock. If any of the following risks were to
occur, our business, financial condition or results of operations would be
likely to materially suffer and would raise doubt whether we could proceed with
our current business plan. In that event, you could lose all or a part of your
investment.
This prospectus contains forward-looking statements based on our current
expectations, assumptions, estimates and projections about Dynacs and our
industry. These forward-looking statements involve risks and uncertainties.
Dynacs' actual results could differ materially from those anticipated in these
forward-looking statements as a result of various factors, as more fully
described throughout this prospectus.
It is especially important to keep these risk factors in mind when you read
forward-looking statements.
Generally, the words "anticipates," "believes," "expects," "plans,"
"estimates," "intends," "may," "will," "should" and "contemplates," and similar
expressions identify such forward-looking statements. These statements are based
on our beliefs as well as assumptions we made using information currently
available to us. Forward-looking statements involve risks and uncertainties, and
our actual results could differ materially from the results discussed in the
forward-looking statements because of these and other unforeseeable factors.
Some, but not all, of the factors that may cause results to materially differ
include those discussed in this Risk Factors section.
You should not place undue reliance on these forward-looking statements,
which apply only as of the date of this prospectus. We do not have any
obligation to inform you if forward-looking statements, or the circumstances on
which they are based, change.
RISKS RELATED TO OUR OPERATIONS GENERALLY
WE ARE IN COMPETITIVE MARKETS FOR SKILLED TECHNICAL PERSONNEL.
Our future success in our growth strategy will depend to a significant
extent on our ability to attract, train, motivate and retain highly skilled
information and applied technology, software, and other professionals in the
United States as well as in India and Indonesia, where our media production and
software development facilities are located. The market for these professionals
in the United States is highly competitive, and the market in India is becoming
more competitive as an increasing number of multi-national corporations are
establishing information technology operations there. We meet a substantial
portion of our personnel requirements by hiring contract employees, primarily
overseas. As a result of these factors, we cannot assure you that we will be
able to attract and assimilate new employees and contract personnel as our
business continues to grow. We also cannot assure you that we will be successful
in retaining current or future employees, including contract employees.
The competitive environment is made tougher because the supply of
professionals in the field of information technologies has decreased in most
developed countries, particularly in the United States, the countries of Western
Europe and Japan. According to the U.S. Department of Education, from 1986 to
1995, the number of bachelors degrees in computer science awarded per year at
colleges in the U.S. fell by 41.7%, from 41,889 to 24,404. This trend has
resulted in a growing shortage of
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<PAGE> 13
professionals in the area of information technologies in the United States.
According to the Information Technology Association of America, the number of
unfilled positions for such professionals at U.S. companies with more than 100
employees was 346,000 in January 1998. In addition, the U.S. Department of
Commerce has estimated that between 1994 and 2005, U.S. companies will require
more than one million new information technology professionals to fill newly-
created positions and replace departing employees.
OUR BUSINESS WILL SUFFER IF WE CANNOT RETAIN OUR KEY PERSONNEL.
Our success is substantially dependent on the ability and experience of our
senior management and other key personnel, many of whom would be difficult to
replace. We intend to enter into an employment agreement with each senior
management employee, including Ramendra P. Singh, Ravi Venugopal, Harry W.
Schubele III, Jayant Ramakrishnan, Javier E. Benavente and Robert Rodriguez,
pursuant to which such individuals will be employed as executive officers of
Dynacs. The loss of any member of our management team or other key employee
would have a substantial and adverse effect on our business, financial condition
and results of operations. We maintain $1.0 million in insurance on the life of
Ramendra P. Singh, our President and Chief Executive Officer, and $250,000 in
insurance on the lives of our Senior Vice Presidents, Javier E. Benavente,
Jayant Ramakrishnan, Harry W. Schubele III and Ravi Venugopal. See "Certain
Transactions."
OUR DEPENDENCE ON OVERSEAS DIGITAL PRODUCTION AND SOFTWARE DEVELOPMENT
FACILITIES SUBJECTS US TO VARIOUS RISKS OF FOREIGN OPERATIONS.
A significant element of our business strategy is to continue to leverage
our overseas digital production facilities in India and Indonesia. These
overseas facilities give us the ability to provide service to our clients for up
to 16 hours per day, six days per week, at a cost that is substantially lower
than the cost of such operations in the U.S. or any of several countries where
there is a comparable supply of skilled labor.
Historically, our wage costs in India and Indonesia have been significantly
lower than our wage costs in the United States for employees with comparable
skills, although wage costs in India and Indonesia are currently increasing at a
faster rate than wages in the United States. The loss of our work force in India
or Indonesia or the shift of a substantial portion of our workforce from India
and Indonesia to the United States or other countries where wages are
significantly higher could have a substantial and adverse effect on our
business, our financial condition and our results of operations.
Both Indonesia and India have recently experienced civil unrest and, from
time to time, have been involved in regional conflict. Our business strategy of
utilizing the more cost-effective overseas production facilities could be
materially adversely affected by changes in laws or regulations affecting
foreign investments, including reduction in scope or elimination of tax
incentives, increased tax rates and currency exchange rates. We are also subject
to social instability and all other political, economic or diplomatic
developments in or affecting India or Indonesia. Any of these changes could
significantly increase our operating expenses, and thus have a material, adverse
effect on our financial condition and results of operations. See "Government
Regulation -- India and Indonesia."
OUR BUSINESS MAY SUFFER IF WE CANNOT DEVELOP AND PROTECT OUR INTELLECTUAL
PROPERTY.
Our success and ability to compete are substantially dependent on our
internally developed technologies, which we seek to protect through a
combination of copyrights, trade secret, trademark, and, to some extent, patent
laws. However, our efforts to establish and protect our intellectual property
rights may be inadequate to prevent misappropriation of our solutions or
technologies,
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<PAGE> 14
particularly in foreign countries where laws or law enforcement practices may
not protect our proprietary rights as fully as in the United States.
Furthermore, we rely substantially on certain technologies that are not
proprietary and are therefore available to our competitors. We also rely on
certain proprietary trade secrets and know-how that are not patentable or that
we do not patent in order to maintain confidentiality. Although we have taken
steps to protect our unpatented trade secrets and know-how, in part through the
use of confidentiality agreements with our employees, consultants and other
parties and controlled access to certain proprietary information, there can be
no assurance that such agreements will not be breached, that we would have
adequate remedies for any breach, or that our trade secrets will not otherwise
become known or be independently developed or discovered by competitors.
We have developed certain of our proprietary technology pursuant to
development contracts, including contracts with U.S. Government agencies. Our
strategy is to continue to develop a significant portion of our proprietary
technology pursuant to customer-funded research and development contracts with
the U.S. Government. There can be no assurance that we will be able to continue
to obtain this type of contract, or that, if we do, that we will obtain rights
to such technology sufficient to permit us to develop and market new
technologies or prevent third parties from using these technologies to compete
with us.
OUR FINANCIAL CONDITION AND RESULTS OF OPERATIONS MAY CONTINUE TO BE ADVERSELY
AFFECTED IF WE DO NOT SETTLE OR PREVAIL IN OUR LITIGATION WITH JUNO PIX, INC.
AND NEW LINE PRODUCTIONS, INC.
In February 1998, we filed claims totaling approximately $2.9 million
against Juno Pix, Inc., New Line Productions, Inc., as guarantor, and its
parent, New Line Cinema Productions, Inc. with the American Arbitration
Association. The claims relate to sums owed to us in connection with
colorization and other work completed by us for the motion picture
"Pleasantville" prior to Juno's termination of our February 1997 agreement. Juno
subsequently filed counterclaims for damages against us. Although we believe
that Juno wrongfully appropriated our software, we cannot assure you that the
decision of the arbitrators in this matter will be favorable to Dynacs. In
addition, at September 30, 1999, we had incurred legal expenses in connection
with this matter of approximately $483,000, contributing to a net loss for the
fiscal year ended on that date. Our legal expenses for this matter through
January 31, 2000 were approximately $1.0 million, and we will continue to incur
legal expenses in connection with this matter until it is settled or a final
determination is rendered, which we do not expect until some time in April 2000.
These legal expenses will continue to have a material adverse effect on our
financial condition and results of operations. In addition, any final
disposition requiring us to pay our adversaries a substantial sum will also have
a material adverse effect on our financial condition and results of operations.
See "Business -- Legal Proceedings."
WE MAY NOT BE SUCCESSFUL IN ACQUIRING AND INTEGRATING NEW TECHNOLOGIES OR
BUSINESSES.
In August 1999, we acquired Cerulean Colorization, L.L.C., a company that
provides digital colorization services, and we intend to continue acquiring or
entering into relationships with complementary businesses, services or
technologies, including black-and-white film libraries. We cannot assure you
that we will be able to identify additional acquisition or investment
candidates. Even if we do identify suitable candidates, we cannot assure you
that we will be able to make such acquisitions or investments on commercially
acceptable terms. Although Cerulean Colorization, L.L.C.'s senior management
remained following our acquisition, we may not be successful in managing its
operations. We may not be able to retain the key personnel of Cerulean
Colorization, L.L.C. or other companies we may acquire for a substantial period
of time, if at all. If we acquire other businesses, we could have difficulty in
assimilating the acquired services or technologies into our
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<PAGE> 15
operations. These difficulties could disrupt our ongoing business, distract our
management and employees, increase our expenses and adversely affect our results
of operations. In connection with our acquisition of Cerulean Colorization,
L.L.C., we issued equity securities which will convert into common stock of the
Company upon effectiveness of this offering. We may have to incur debt and issue
equity securities to pay for any future acquisitions. The issuances of equity
securities in connection with the Cerulean transaction and for future
acquisitions will dilute your stock ownership in our company.
WE MAY HAVE DIFFICULTY OBTAINING ADDITIONAL FUNDING IF NEEDED TO ACQUIRE NEW
BUSINESSES OR TO EXPAND OUR EXISTING BUSINESSES.
Although we believe that the net proceeds from this offering, together with
cash flows from operations and available lines of credit, will be sufficient to
meet our capital requirements for at least the next 12 months, we may seek
additional equity or debt financing to compete more effectively in the markets
we serve. We intend to grow our digital media and production businesses rapidly
by more actively marketing and purchasing black-and-white film libraries which
we can colorize and syndicate which will include Internet-based distribution of
our products and services through MarketYourMedia.com. We intend to grow our
Information and Applied Technology Division ("IAT Division") by adding more
technical personnel and more marketing personnel to attract additional clients
and to secure more work from existing customers. Our ability to secure
additional financing will be subject to a number of factors, including:
- market conditions;
- our operating performance; and
- investor sentiment, particularly for companies with Internet-related
business segments.
These factors may make the timing, amount, terms and conditions of
additional financing unattractive. If we are unable to raise capital to fund
future growth of our business, our financial condition and results of operations
would be materially and adversely affected.
RISKS RELATED TO OUR INFORMATION AND APPLIED TECHNOLOGY BUSINESS
WE DEPEND UPON FUNDING OF MULTI-YEAR CONTRACTS WITH U.S. GOVERNMENT AGENCIES
WHICH IS SUBJECT TO CHANGES IN U.S. GOVERNMENT POLICIES AND ANNUAL BUDGETARY
APPROVALS.
During our 1999, 1998, and 1997 fiscal years, we derived approximately
96.0%, 97.5% and 90.0%, respectively, of our total revenues from contracts with
NASA and the U.S. Air Force, either as a prime contractor or subcontractor, and
we anticipate that contracts with these U.S. Government agencies are likely to
continue to account for a significant portion of our revenues in the foreseeable
future. Most of our contracts with U.S. Government agencies have basic terms of
one or more years plus one or more option years, and many of the option periods
cover more than half of the contract's potential duration. The exercise of these
options is within the discretion of the contracting agency, and U.S. Government
agencies have the right to terminate any contract at any time "for convenience
of the Government." In addition, we generally are not the exclusive outside
source for services to a U.S. Government agency. Accordingly, dissatisfaction
with our performance could lead a U.S. Government agency to purchase these
services from our competitors.
Significant changes by the U.S. Government in its contracting or fiscal
policies or in Congressional funding from year to year as the result of
budgetary constraints, the adoption of new laws or regulations, the curtailment
of the U.S. Government's use of technology, or the response to protests by
competitors could result in program cancellations or cutbacks or cause U.S.
Government
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<PAGE> 16
agencies, including NASA and the Air Force, to reduce the services purchased
under our multi-year contracts, decline to exercise extension options or
terminate these contracts for convenience. Any of these actions by these U.S.
Government agencies could have a material adverse effect on our business,
results of operations and financial condition.
Although we intend to reduce our dependence on U.S. Government contracts by
devoting substantial resources to further exploitation of private sector markets
for our services, we will continue to depend on U.S. Government contracts until
our private sector revenues increase substantially. We cannot assure you,
however, that we will be successful in developing commercial markets for our
services or that revenues from such markets, once developed, will be sufficient
to overcome our dependence on revenues from U.S. Government contracts.
LOSS OF OUR STATUS AS A SMALL BUSINESS OR SMALL DISADVANTAGED BUSINESS COULD
REDUCE OUR GOVERNMENT CONTRACTING BUSINESS.
Currently, the U.S. Government is the primary customer of our information
and applied technology division. Most of the U.S. Government contracts we pursue
are awarded on the basis of competitive bidding. We have derived various
benefits, however, in securing work on contracts and subcontracts with U.S.
Government agencies as the result of our status as a small business and/or a
small disadvantaged business (SDB), and our participation in the Section 8(a)
Program of the Small Business Administration (SBA). If we lose our small
business status, the total dollar amount of U.S. Government contracts awarded to
us in the future could decrease. See "Business -- Competition for U.S.
Government Projects."
OUR FINANCIAL PERFORMANCE WILL BE ADVERSELY AFFECTED IF WE DO NOT REALIZE MOST
OF THE REVENUES INCLUDED IN OUR BACKLOG.
Although our total contract backlog was approximately $207.9 million as of
December 31, 1999, we may not realize all or even a substantial portion of this
backlog as revenue. Our funded backlog of $34.9 million (or 16.8% of the total
backlog) consists of the dollar amount of contracts in our information systems
and aerospace/satellite systems and operations that is currently appropriated by
the customer and allocated to the contract or otherwise authorized for payment
by the customer upon completion of a particular portion of the work. Our
unfunded backlog of $173.0 million (or 83.2% of the backlog) consists of the
stated award value of these contracts and includes renewals or extensions that
have been priced but as to which the contracting agency retains funding
discretion. If any of the following events occur, we may fail to realize a
significant portion of the revenues included in our backlog:
- The U.S. Government's failure to fund all of the years of a multi-year
contract;
- The U.S. Government's failure to exercise its option to extend the term
of a contract;
- The U.S. Government's failure to request any services under contracts
that we provide only upon request of the government; and
- The U.S. Government's decision to decrease the size or scope of a
contract or to terminate a contract.
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<PAGE> 17
CHANGES IN LAWS AND REGULATIONS AFFECTING U.S. GOVERNMENT CONTRACTING COULD
ADVERSELY AFFECT OUR FINANCIAL PERFORMANCE.
As a contractor and subcontractor with U.S. Government agencies, we are
subject to various U.S. Government laws and regulations. These regulations
affect how our customers and we do business and, in some instances, impose added
costs on our businesses. Any changes in applicable laws could adversely affect
the financial performance of our business to the extent affected by the changed
regulations. Any failure to comply with applicable laws could result in contract
termination, price or fee reductions or suspension or debarment from contracting
with the U.S. Government. In addition, changes in any of the many U.S.
Government procurement rules and regulations could harm our business.
AUDITS OF OUR U.S. GOVERNMENT CONTRACTS COULD RESULT IN LOSS OF ANTICIPATED
REVENUE OR REVENUE ALREADY BOOKED OR COULD HARM OUR REPUTATION.
U.S. Government agencies routinely audit government contracts. These
agencies review a contractor's performance on its contract, pricing practices,
cost structure and compliance with applicable laws, regulations and standards.
Any costs found to be improperly allocated to a specific contract will not be
reimbursed, while improper costs already reimbursed will be recouped by the U.S.
Government agency. Audits could, consequently, result in substantial downward
adjustments of our revenue. Any such adjustment could adversely affect our
business, and we could be required to reimburse the U.S. Government for amounts
we have expended on our contracts. No material adjustments have resulted from
any audits of us completed as of December 31, 1996, and we have no reason to
believe that adjustments resulting from subsequent audits will be substantial.
We cannot assure you, however, that audits of contracts for subsequent years
will not result in material adjustments in U.S. Government contract revenues
previously earned by us which would require us to reimburse to the U.S.
Government.
THE PRICING PROVISIONS OF OUR CONTRACTS MAY ADVERSELY AFFECT OUR PROFITS.
Under certain of our contracts we are compensated on a cost-reimbursable
basis. We deem these to be low-risk contracts. However, a growing percentage of
our contracts are time-and-materials contracts which provide for the customer to
pay a specified rate per hour of labor dedicated to the project. These contracts
are deemed to be higher-risk contracts since market or other conditions may
require us to increase our employees' salaries or other costs without such
proportional increases passed through to our customers.
RISKS RELATED TO OUR DIGITAL MEDIA AND ENTERTAINMENT BUSINESS
WE FACE SIGNIFICANT COMPETITION IN DIGITAL MEDIA.
The decline in the cost of new equipment combined with advances in software
and related hardware will make it easier for potential competitors to enter the
sector of the digital media industry that provides animation, digital color and
special effects. Although we believe that we are currently the leading provider
of cost-effective processes to convert large volumes of black-and-white films
and other media into digital color material, many companies are better
established, have substantially better research and development staffs than we
do and may develop proprietary digital colorization processes and facilities
that could compete for colorization work. These companies may be more successful
in acquiring visual media for colorization and distributing it. We intend to
acquire media properties in the public domain and those owned by third parties
to colorize and copyright. More established companies with larger marketing
staffs and greater financial resources may compete with us for the acquisition
of certain media properties.
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<PAGE> 18
WE ARE UNCERTAIN OF THE MARKET FOR DIGITALLY COLORED AND RE-MASTERED FILMS.
There can be no assurance that digitally colored and re-mastered motion
pictures, television programs and historical film footage will find broad enough
acceptance among broadcasters and consumers to make our color re-mastering
business profitable.
IF SUITABLE PRODUCT IS NOT AVAILABLE ON ECONOMICALLY FEASIBLE TERMS, OUR
COLORIZATION BUSINESS MAY NOT SUCCEED.
We have developed and acquired colorizing technology and enhancements,
including various patented processes, since commencement of our digital media
business in 1996. Our success in digital re-mastering is in part contingent upon
finding and acquiring, on economically feasible terms, enough product suitable
for colorization. We cannot predict with any certainty that sufficient product
will be available and, if so, whether product will be available on economically
feasible terms.
WE ARE INEXPERIENCED IN FILM AND TELEVISION DISTRIBUTION.
We have limited experience in the distribution of film and television
product, a highly competitive business. Our success will depend in great part on
our ability to hire qualified personnel to perform distribution, or in the
alternative, to negotiate joint venture or other favorable distribution
agreements with established distribution companies. We cannot assure you that we
will be successful in developing these distribution channels.
RISKS RELATED TO OUR PLANNED INTERNET MEDIA LIBRARY AND
MARKETPLACE, "MARKETYOURMEDIA.COM"
WE CANNOT PREDICT THE SUCCESS OF MARKETYOURMEDIA.COM BECAUSE OUR BUSINESS MODEL
IS UNPROVEN.
We intend to use a portion of the proceeds of this offering to develop the
infrastructure for a web site under our registered domain name,
"MarketYourMedia.com." The on-line market we hope to create through
MarketYourMedia.com is new and unproven. We intend to acquire or obtain the
rights to license visual media from third parties and to act as an intermediary
for the sale and distribution of rights to visual media held by third parties.
If we are unable to obtain desirable material in sufficient quantity and on
acceptable terms, MarketYourMedia.com may not become a financially viable
business or otherwise succeed. We believe that the successful development of our
MarketYourMedia.com Internet business also depends on finding enough product for
our library and marketplace.
THE SUCCESS OF MARKETYOURMEDIA.COM, DEPENDS ON CONTINUED DEVELOPMENT OF INTERNET
CAPACITY.
To the extent that we put our library of visual media online as part of our
marketing strategy for MarketYourMedia.com, our success as an Internet business
will depend upon continued developments in broadband capacity on the Internet
and continued growth in use of computers with substantial capacity. We may not
be able to deliver large quantities of visual media over the Internet to large
numbers of potential customers, or if we are able to, at competitive costs
and/or satisfactory quality. If we cannot deliver sufficient quantities of media
over the Internet to meet demand, or if a large proportion of our customers
cannot receive our material online, then the deployment of our business may be
delayed. Our use of the Internet to distribute materials requiring broad band
capacity will also expose us to greater risk of system failures and
incompatibility with online systems used by our current customers and suppliers.
Our business may be materially adversely affected to the extent that our
distribution methods are incompatible.
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WE EXPECT SUBSTANTIAL COMPETITION TO DEVELOP FOR OUR FUTURE MARKETYOURMEDIA.COM
BUSINESS.
Because a significant amount of the technology we will use to establish and
operate MarketYourMedia.com is not proprietary, the same technology can be used
by other companies to establish competing online businesses. Accordingly, we
anticipate further competition, especially if MarketYourMedia.com proves to be
successful. Furthermore, Internet technology, commercial applications and
on-line usage are all rapidly evolving. If we do not respond in a cost-effective
and timely manner to rapid changes in Internet technology, our
MarketYourMedia.com business might be materially and adversely affected. As the
tastes of our potential buyers and licensees change, our success will require
that we continually develop, enhance and improve the features of our web site.
Our success in this business will require us to respond, on a cost-effective and
timely basis, to technological advances and emerging industry standards and
practices, including advances in technology used to distribute visual media and
entertainment over the Internet. To the extent that we are unable keep up with
advances by competitors or meet shifting tastes and demands,
MarketYourMedia.com's business will be materially and adversely affected.
RISKS RELATED TO THE OFFERING AND OUR COMMON STOCK
STOCK OWNERSHIP OF OUR OFFICERS AND DIRECTORS UPON COMPLETION OF THIS OFFERING
COULD DELAY OR PREVENT STOCKHOLDER ACTIONS.
Upon the completion of this offering, our officers and directors will
beneficially own 68.0% of our outstanding common stock, or 65.2% if the
underwriter's over-allotment option is exercised in full. While no individual
will be a beneficial owner of a majority of the outstanding shares of our common
stock, collectively, our management, will be able to control decisions on
corporate matters, including election of directors, increases in our authorized
capital stock, dissolution and merger or sale of assets, and they will be able
generally to direct our affairs. This concentration of ownership may also have
the effect of delaying, deferring or preventing a change in control of the
Company and making transactions more difficult or impossible, absent the support
of these stockholders, including proxy contests, mergers involving Dynacs,
tender offers, open-market purchase programs or other purchases of our common
stock that could give public, minority stockholders of Dynacs the opportunity to
realize a premium over the then-prevailing market price for shares of common
stock. See "Principal Stockholders."
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<PAGE> 20
USE OF PROCEEDS
We estimate that the net proceeds to Dynacs from the sale of the shares of
common stock in this offering will be approximately $22,250,000 (after deducting
estimated offering expenses of $750,000 and underwriting discounts and fees of
$2,000,000) or $25,700,000 if the underwriters' over-allotment option is
exercised in full, after deducting underwriting discounts and fees and estimated
offering expenses of $3,050,000.
We intend to use the net proceeds of this offering (assuming the
underwriters do not exercise their over-allotment option) as described in the
following table:
<TABLE>
<CAPTION>
AMOUNT OF PERCENTAGE OF NET
NET PROCEEDS PROCEEDS
------------ ------------------
<S> <C> <C>
Acquisition of rights in media assets.......... $ 8,050,000 36.2%
Repayment of line of credit.................... 3,000,000(1) 13.5%
Expand and upgrade U.S. and overseas facilities
and equipment and build new U.S and overseas
facilities................................... 2,750,000 12.4%
Repay long-term debt........................... 2,500,000(2)(3) 11.2%
Hire additional marketing, technical and
production personnel......................... 2,062,500 9.3%
Research and development....................... 1,750,000 7.9%
Marketing...................................... 687,500 3.0%
Working capital and general corporate
purposes..................................... 1,450,000(4) 6.5%
----------- ------
$22,250,000 100.0%
=========== ======
</TABLE>
- -------------------------
(1) We currently have a $4,000,000 revolving line of credit with First National
Bank of Florida which bears interest at the Banks' prime rate plus 2.0% per
annum (10.75% at February 29, 2000) and is secured by all of our assets. As
of February 29, 2000, an aggregate principal amount and accrued unpaid
interest of $3,227,308 was outstanding under this line of credit. We intend
to use $3,000,000 of the net proceeds of this offering to repay such
indebtedness, and at such time, such amount will become available to us to
borrow in the future. See "Management's Discussion and Analysis of Financial
Condition and Results of Operations -- Cash Flow -- Cash Flow from Financing
Activities."
(2) In November 1999 and January 2000 and February and March 2000, we issued
Bridge Notes for an aggregate principal amount of $2.9 million. The Bridge
Notes bear interest at the initial rate of 8.0% per annum during the first
120 days of issuance and thereafter at the rate of 15.0% until the Bridge
Notes are either converted into shares of common stock of Dynacs or repaid,
at the election of the holder. For purposes of this section, we assume that
all of the holders of the Bridge Notes elect to be repaid instead of
converting their Bridge Notes into common stock. In such event, we intend to
use $1.0 million of the net proceeds of this offering and $1.9 million from
operating cash flows to repay the outstanding Bridge Notes. To the extent
that any holders of the Bridge Notes elect to convert their Bridge Notes
instead of being repaid, any monies which would have otherwise been
allocated to repay such Bridge Notes will be allocated to working capital
and general corporate purposes. Interest on the Bridge Notes is being paid
quarterly out of operating cash flow. See "Management's Discussion and
Analysis of Financial Condition and Results of Operations -- Cash
Flow -- Cash Flow from Financing Activities."
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(3) We intend to use $1.5 million of the net proceeds of this offering to repay
the following indebtedness:
- An aggregate amount of $585,000 outstanding as of March 15, 2000
pursuant to a loan agreement, dated May 10, 1999, between Dynacs and
Ramesh Venugopal, the brother of Ravi Venugopal, a Senior Vice
President and the Secretary of Dynacs, bearing interest at the rate of
10% per annum with no maturity date.
- A promissory note, dated October 6, 1997, issued by Dynacs to
Venugopal Srinivasan and Ranjini Srinivasan, the brother and
sister-in-law of Ravi Venugopal, a Senior Vice President and the
Secretary of Dynacs, in the principal amount of $200,000, bearing
interest at the rate of 10.5% per annum and maturing on October 6,
2000. The outstanding balance at February 29, 2000 was $58,000.
- A promissory note, dated February 15, 1999, issued by Dynacs to
Venugopal Srinivasan in the principal amount of $110,000, bearing
interest at the rate of 12.0% per annum with an extended maturity of
August 15, 2000.
- A promissory note, dated March 30, 1999, issued by Dynacs to Dr.
Ramendra Singh, Dynacs' President, Chief Executive Officer and a
principal stockholder, in the principal amount of $160,000, bearing
interest at the rate of 12.0% per annum with an extended maturity of
September 30, 2000.
- A promissory note, dated February 23, 1999, issued by Dynacs to Ravi
Venugopal in the principal amount of $248,000, bearing interest at the
rate of 12.0% per annum with an extended maturity of August 23, 2000.
- A promissory note, dated February 23, 1999, issued by Dynacs to Anil
Singh, Dr. Singh's nephew, in the principal amount of $89,000, bearing
interest at the rate of 12.0% per annum with an extended maturity of
August 23, 2000.
- A promissory note, dated September 30, 1999, issued by Dynacs to
George Benham in the principal amount of $250,000, bearing interest at
the rate of 14.5% per annum with an extended maturity of September 30,
2000.
The proceeds of the foregoing indebtedness were used for working capital
purposes. See "Certain Transactions -- Related Party Loans to Dynacs."
(4) We intend to loan $150,000 to Michael Burns, a director-nominee of Dynacs,
pursuant to the terms of our acquisition of Cerulean Colorization, L.L.C. in
August 1999. See "Certain Transactions -- Acquisition of Cerulean
Colorization, L.L.C."
A portion of the net proceeds may also be used for possible future
strategic alliances and acquisitions. This would reduce the use of the net
proceeds for one or more of the uses indicated in the preceding table. We
currently do not have any understandings, commitments or agreements concerning
these types of transactions.
We have complete discretion over how to use the net proceeds of this
offering. Our use of the net proceeds may vary substantially from that indicated
in the preceding table due to unforeseen events or changed business conditions.
Pending these uses, we intend to invest the net proceeds temporarily in
short-term, investment grade, interest-bearing securities or guaranteed
obligations of the U.S. Government.
17
<PAGE> 22
DIVIDEND POLICY
We have never declared or paid any cash dividends on our capital stock nor
do we expect to do so in the foreseeable future. We currently intend to retain
all of our earnings, if any, to finance the expansion of our business and do not
expect to declare or pay any cash dividends in the foreseeable future. Future
cash dividends, if any, will be paid at the discretion of our board of
directors.
18
<PAGE> 23
CAPITALIZATION
The following table provides, as of December 31, 1999, the
(i) pro-forma capitalization of Dynacs reflecting:
- the issuance of an aggregate principal amount of $2.4 million in Bridge
Notes, of which $747,000 was allocated to the detachable warrants, in
connection with the Bridge Financings; and
(ii) pro-forma as adjusted to reflect;
- the issuance of 701,588 shares of common stock to sellers of the equity
interests in Cerulean Colorization, L.L.C. upon closing of this offering
and a reclassification of the $393,452 minority interest into $7,016 of
common stock and $386,436 of additional paid-in-capital; and
- the $345,000 revaluation of warrants and recording of the $1,653,000
beneficial conversion feature upon the consummation of this offering;
- the paydown of $1,205,013 of long-term debt by Dynacs prior to the
consummation of this offering;
- receipt of the net proceeds of $22,250,000 from our sale of common stock
in this offering, at an initial public offering price of $10.00 per
share, after deducting underwriting discounts and fees and our estimated
offering expenses; and
- the paydown of $1,500,000 of long-term debt from the proceeds of this
offering.
You should read this table in conjunction with "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and the financial
statements and related notes appearing elsewhere in this prospectus.
<TABLE>
<CAPTION>
DECEMBER 31, 1999
-----------------------------------------
PRO FORMA
ACTUAL PRO FORMA AS ADJUSTED
----------- ----------- -----------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C>
Current portion of long-term debt.............. $ 3,031,451 $ 4,684,451 $ 90,264
Long-term debt, less current portion........... 108,826 108,826 --
Stockholders' equity:
Preferred stock, $.01 par value; 5,000,000
shares authorized; no shares issued and
outstanding, actual, pro forma and pro
forma as adjusted......................... -- -- --
Common stock; $.01 par value, 15,000,000
shares authorized; 5,355,259 shares issued
and outstanding, actual and pro forma;
8,556,847 shares issued and outstanding,
pro forma as adjusted..................... 53,553 53,553 85,569
Additional paid-in-capital................... 3,130,201 3,877,201 28,486,637
Note receivable for common stock............. (1,125,700) (1,125,700) (1,125,700)
Accumulated other comprehensive income....... 4,396 4,396 4,396
Retained deficit............................. (805,855) (805,855) (805,855)
----------- ----------- -----------
Total stockholders' equity..................... 1,256,595 2,003,595 26,645,047
----------- ----------- -----------
Total capitalization........................... $ 4,396,872 $ 6,796,872 $26,735,311
=========== =========== ===========
</TABLE>
19
<PAGE> 24
DILUTION
Purchasers of the common stock in this offering will experience immediate
and substantial dilution in the net tangible book value of the common stock from
the initial public offering price. Net tangible book value per share represents
the amount of Dynacs' total tangible assets less its total liabilities, divided
by the number of shares of common stock issued and outstanding. At December 31,
1999, Dynacs had a net tangible book value of $(7,565,730) or $(1.41) per share
of common stock. After giving effect to the sale of shares of common stock
offered by Dynacs, at an assumed initial public offering price of $10.00 per
share and after deducting underwriting discounts and fees and estimated offering
expenses, Dynacs' net tangible book value as of December 31, 1999, would have
been $1,189,889 or $0.16 per share. This represents an immediate increase in net
tangible book value of $1.57 per share to existing stockholders and an immediate
and substantial dilution of $9.86 per share to new investors purchasing shares
in this offering. The following table illustrates this per share dilution:
<TABLE>
<S> <C> <C>
Assumed offering price per share of common stock............ $10.00
Consolidated net tangible book value per share before
offering............................................... (1.41)
Increase in pro forma net tangible book value per share
attributed to the estimated net proceeds of the
offering............................................... 1.57
-----
Pro forma as adjusted net tangible book value per share
after the offering........................................ 0.16
------
Dilution of net tangible book value per share of common
stock to investors in the offering........................ $ 9.84
======
</TABLE>
The following table summarizes as of December 31, 1999, the differences in
total consideration paid and the average price per share paid by existing
stockholders, including the conversion of 20.0% of the common stock of Cerulean
FXs, Inc. into 701,588 shares of Dynacs common stock upon consummation of this
offering, and new investors with respect to the number of shares of common stock
purchased from Dynacs after giving effect to the sale of 2,500,000 shares of
common stock in this offering.
<TABLE>
<CAPTION>
SHARES PURCHASED TOTAL CONSIDERATION AVERAGE
----------------------- ------------------------ PRICE PER
NUMBER PERCENTAGE AMOUNT PERCENTAGE SHARE
--------- ---------- ---------- ---------- ---------
<S> <C> <C> <C> <C> <C>
Existing Stockholders......... 6,056,847 70.8% 3,183,754 11.3% $ .53
New Investors................. 2,500,000 29.2% 25,000,000 88.7% $10.00
--------- ----- ---------- -----
Total............... 8,556,847 100.0% 28,183,754 100.0%
========= ===== ========== =====
</TABLE>
20
<PAGE> 25
SELECTED CONSOLIDATED FINANCIAL DATA
The following selected financial data contains certain financial and
operating data and is qualified by the more detailed Consolidated Financial
Statements and notes thereto included elsewhere in this prospectus. The Balance
Sheet Data as of December 31, 1998 and September 30, 1999 and the Statement of
Operations Data for the year ended December 31, 1998 and nine-months ended
September 30, 1999 were derived from the Consolidated Financial Statements and
notes thereto that have been audited by Arthur Andersen LLP, independent
certified public accountants, and are included elsewhere in this prospectus. The
Balance Sheet Data as of December 31, 1997 and the Statement of Operations Data
for the year ended December 31, 1997 have been derived from the Consolidated
Financial Statements and notes thereto that have been audited by Hoyman, Dobson
& Company, P.A., independent certified public accountants, and are included
elsewhere in this prospectus. The Balance Sheet Data as of September 30, 1998
and December 31, 1999 and Statement of Operations Data for the nine-month period
ended September 30, 1998 and the three month period ended December 31, 1998 and
1999 have been derived from the unaudited financial statements of Dynacs which,
in the opinion of management, have been prepared on the same basis as the
audited financial statements and include all adjustments, consisting of normal
recurring adjustments, which management considers necessary for a fair
presentation of the selected financial data shown. The financial data shown
should be read in conjunction with the Consolidated Financial Statements and the
related notes thereto and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" included elsewhere in this prospectus. The
historical results presented herein are not necessarily indicative of future
results.
<TABLE>
<CAPTION>
NINE MONTHS ENDED THREE MONTHS ENDED
YEAR ENDED DECEMBER 31, SEPTEMBER 30, DECEMBER 31,
------------------------- ------------------------- -------------------------
1997 1998 1998 1999 1998 1999
----------- ----------- ----------- ----------- ----------- -----------
(UNAUDITED) (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
REVENUES
Information and Applied Technology........ $26,068,005 $59,615,270 $42,324,852 $53,896,828 $17,290,418 $17,363,517
Media and Entertainment................... 892,834 1,331,416 466,600 1,398,257 864,816 266,742
----------- ----------- ----------- ----------- ----------- -----------
TOTAL REVENUES.............................. 26,960,839 60,946,686 42,791,452 55,295,085 18,155,234 17,630,259
COST OF REVENUES
Information and Applied Technology........ 22,980,525 56,211,548 39,758,667 51,233,756 16,452,881 15,120,030
Media and Entertainment................... 1,007,667 1,817,647 1,018,374 3,063,995 799,273 1,124,644
----------- ----------- ----------- ----------- ----------- -----------
TOTAL COST OF REVENUES...................... 23,988,192 58,029,195 40,777,041 54,297,751 17,252,154 16,244,674
----------- ----------- ----------- ----------- ----------- -----------
Gross Profit................................ 2,972,647 2,917,491 2,014,411 997,334 903,080 1,385,585
General and Administrative Expenses......... 2,480,825 2,639,986 1,268,610 3,444,599 1,371,376 1,442,538
----------- ----------- ----------- ----------- ----------- -----------
Operating Income (Loss)..................... 491,822 277,505 745,801 (2,447,265) (468,296) (56,953)
Interest Expense, net....................... 46,522 204,450 109,415 491,279 95,035 188,209
Loss on Equity Method Investment............ 3,196 67,039 50,279 27,867 16,760 33,518
----------- ----------- ----------- ----------- ----------- -----------
Income (Loss) Before Income Tax Benefit
(Provision)............................... 442,104 6,016 586,107 (2,966,411) (580,091) (278,680)
Income Tax(Provision) Benefit............... (178,571) 35,000 (244,000) 1,360,000 279,000 69,000
----------- ----------- ----------- ----------- ----------- -----------
Net Income (Loss)........................... $ 263,533 $ 41,016 $ 342,107 $(1,606,411) $ (301,091) $ (209,680)
=========== =========== =========== =========== =========== ===========
Diluted Net Income (Loss) per share:........ $ 0.03 $ 0.01 $ 0.04 $ (0.30) $ (0.06) $ (0.04)
=========== =========== =========== =========== =========== ===========
Diluted Weighted Average Number of
Shares:................................... 7,860,930 7,860,930 7,860,930 5,398,778 4,913,081 5,355,259
=========== =========== =========== =========== =========== ===========
</TABLE>
<TABLE>
<CAPTION>
DECEMBER 31, SEPTEMBER 30, DECEMBER 31,
------------------------- -------------------------- ------------
1997 1998 1998 1999 1999
---------- ----------- ----------- ----------- ------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Working Capital...................................... $ 206,509 $ (722,137) $ 636,255 $(3,879,271) $(4,467,144)
Total Assets......................................... 5,311,299 11,301,057 11,878,913 14,271,505 12,264,440
Long-Term Debt (including current portion)........... 439,675 1,621,836 1,683,387 3,149,745 3,140,277
Total Stockholders' Equity........................... 943,460 1,048,480 1,626,817 1,300,820 1,256,595
</TABLE>
21
<PAGE> 26
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with our financial
statements and notes to those statements and other financial information
appearing elsewhere in this prospectus. In addition to historical information,
the following discussion and other parts of this prospectus contain
forward-looking information that involves risks and uncertainties. Dynacs'
actual results could differ materially from those anticipated by such
forward-looking information due to various factors, including, but not limited
to, those set forth under the heading "Risk Factors" and elsewhere in this
prospectus.
THE DISCUSSION BELOW OF OUR FINANCIAL CONDITION AND RESULTS OF OPERATIONS
BEGINS WITH A DESCRIPTION OF CERTAIN FEATURES OF OUR BUSINESS WHICH AFFECT OUR
FINANCIAL CONDITION AND RESULTS. YOU SHOULD NOTE THAT IN 1999 WE CHANGED OUR
FISCAL YEAR FROM A CALENDAR YEAR TO A YEAR ENDING SEPTEMBER 30, WITH THE RESULT
THAT OUR 1999 FISCAL YEAR IS A NINE-MONTH YEAR. YEAR-TO-YEAR COMPARISONS
INCLUDING THE FISCAL YEAR ENDED SEPTEMBER 30, 1999, ACCORDINGLY, MAY NOT BE
REPRESENTATIVE OF OUR FINANCIAL CONDITION OR RESULTS.
OVERVIEW
Dynacs, which began its operations in 1985, is a company which develops
advanced technologies in the areas of information systems and
aerospace/satellite systems and operations for U.S. Government agencies and
private sector clients -- our Information and Applied Technology Division ("IAT
Division"). Commencing in October 1996, the Company began to broaden the scope
of its growth strategy by developing its media and entertainment business,
initially by providing colorization services on a "work-for-hire basis," based
upon technologies developed by us for the aerospace industry. "Work-for-hire"
contracts involve Dynacs receiving a fee for the services provided, typically at
a rate per minute of colorization material. The most significant commercial
applications that form the basis of our digital media and entertainment business
are our digital color re-mastering and digital masking technologies. In
connection with our shift in our growth strategy in the fiscal year ended
December 31, 1996, we began developing our colorization facilities, specifically
in Patna, India. In August 1999, we acquired Cerulean Colorization, L.L.C., a
company in the business of providing digital color effects for film and videos.
In addition, during 1999 we opened an additional colorization facility in Batam,
Indonesia and further expanded our Patna and U.S. based facilities. We have
spent over $4.0 million in the twelve-month period ended December 31, 1999 to
build the infrastructure to grow our digital media and entertainment business,
including the development of digital remastering production tools and upgrading
existing facilities. We expect to incur additional costs in the future for
capital improvements and equipment upgrades for the production facilities.
REVENUE RECOGNITION
IAT DIVISION. Most of our revenues are generated by our IAT Division and
are derived substantially from contracts with customers in our information
systems and aerospace/satellite systems and operations business. Approximately
97.5% of our revenues for the nine-month period ended September 1999 were
derived from our IAT Division. We typically enter into two types of contracts:
cost-reimbursable and time-and-materials. Although fixed price contracts are
also awarded by the U.S. Government, we are not party to any such agreements at
this time. Cost-reimbursable contracts provide for the reimbursement of costs
plus the payment of a fixed fee. Revenues for cost-reimbursable contracts are
recognized under the percentage of completion method. We bill for our
22
<PAGE> 27
services under these contracts on a monthly basis, with our covered costs
separately billed within two weeks from the date on which we incur such costs.
Under time-and-materials contracts, we are reimbursed for labor hours at
negotiated hourly billing rates and reimbursed for travel and other direct
expenses at actual cost plus applied indirect, general and administrative
expenses. A growing percentage of our contracts are time-and-materials
contracts. Under these contracts, revenues are recognized as service hours are
incurred.
MEDIA AND ENTERTAINMENT DIVISION. Revenues from our media and
entertainment division are derived from two contract types, work for hire and
royalties. Work for hire consists of contracts in which the Company receives a
fee based on the number of minutes of digital re-mastering services provided,
including colorization and special effects. Revenues from work for hire
contracts are recognized under the percentage of completion method. Contract
costs include direct labor and overhead costs specifically related to the
production activities. Royalties contracts include the sales of exhibition
rights for films included in the Company's film library. Revenue is recognized
on these contracts when all of the following conditions have been met:
- the royalty fee for each film is known;
- the cost of each film is known or reasonably determinable;
- collectibility of the full royalty fee is reasonably assured;
- the film has been accepted by the licensee in accordance with the
conditions of the contract; and
- the film is available for its first showing or telecast.
COST OF PROCUREMENT
IAT DIVISION. We obtain contracts with U.S. Government agencies as well as
contracts with private sector clients in the aerospace industry, primarily
through competitive bidding or procurements. Realization of IAT Division
revenues from contracts may range from a few days to up to 18 months, after we
incur expenses for preparing our bids. Although the cost of preparing bids for
particular contracts vary, the costs of preparing bids for complex contracts can
exceed $500,000. We have found, however, that proposals of this magnitude, if
successful, generate substantial revenues. We also bid on smaller IAT projects
involving bidding costs between $5,000 and $50,000. Projects awarded to our IAT
Division vary in total contract value from tens-of-thousands to hundreds-of-
millions of dollars. The magnitude of some proposal costs and the typical six to
twelve-month lag in time (which could be as long as 18 to 24 months in some
instances) between the preparation of a bid and recognition of related income,
if any, can have a material effect on our financial results. This is especially
true when substantial proposal costs are incurred in one fiscal year and
revenues stemming from the proposal are recognized in one or more subsequent
years. During the fiscal years ended December 31, 1997 to September 30, 1999, we
provided technical services under an average of 29 contracts.
MEDIA AND ENTERTAINMENT DIVISION. Our Media and Entertainment Division
generates revenue by providing digital colorization services primarily to owners
of television programming under work-for-hire contracts. In 1998, as part of our
plan to expand our media and entertainment business, we began entering into
arrangements with owners of black-and-white serial television programming. Under
these arrangements, we provide colorization work at reduced rates rather than at
our customary commercial rates, and, in return, we acquire an interest in the
new 75-year copyright for the colorized version asset and the related licensing
fees. The costs of such projects include funding a portion of the acquisition
and development costs of the programming, and adding significant digital
23
<PAGE> 28
remastering capacity at our overseas facilities. The impact of these costs has
been particularly significant during the twelve months ended December 31, 1999,
with cost of revenue of approximately $4.2 million, when the shift from
work-for-hire to royalty-based projects reduced the division's revenues and the
higher costs associated with supporting these projects exceeded the revenues of
the division. We believe that over time we will receive greater revenues from
our ownership interest in the colorized media properties than we have received
from colorization services provided on a work-for-hire basis. Furthermore, to
date, there has also been a delay of six to twelve-months between the time we
complete the work for colorized assets and the time when we begin receiving
revenue from licensing fees on television series. As a result, historic costs
and revenues may not be indicative of future costs and revenues of this
division. In contrast to the lengthy procurement cycle of IAT Division
contracts, the procurement cycle for the work-for-hire contracts of the Media
and Entertainment Division are typically measured in days or weeks for
individual television commercials, to months and possibly a year for complete
television series or feature-length films.
COSTS AND EXPENSES
COSTS OF REVENUES. Costs of revenues include direct labor, material,
travel and subcontracts as well as applied overhead, which consists of allocated
employee benefits and general operating costs, which include depreciation and
facility costs, when applicable. We record expenses associated with the
operations of the Media and Entertainment Division differently, depending upon
whether we provide colorization services on a work-for-hire or a royalty basis.
Expenses of colorization work performed on a work-for-hire basis are recognized
as they are incurred. Expenses of colorizing assets in which we acquire an
interest are capitalized and amortized based on the individual film forecast
method, which measures the ratio of current year revenues to estimated total
revenues.
GENERAL AND ADMINISTRATIVE EXPENSES. The general and administrative
expenses of the Company consist of marketing, administrative, legal,
professional fees, bid and proposal costs. These costs are expensed as incurred.
RESEARCH AND DEVELOPMENT. Virtually all the revenues of our IAT Division
are generated under contracts providing research and development work for our
clients. All costs of this research and development are client-funded.
Therefore, the associated costs of such research and development are treated as
costs of revenue. Our internal development costs not covered by client payment
are inconsequential.
NON-RECURRING COSTS AND EXPENSES. During the twelve-month period ended
December 31, 1999, we incurred approximately $1,000,000 in legal fees and
expenses in conjunction with the Juno arbitration. See "Legal Proceedings."
24
<PAGE> 29
RESULTS OF OPERATIONS
SUMMARY SELECTED FINANCIAL DATA
(VALUES AS A PERCENT OF TOTAL REVENUE)
<TABLE>
<CAPTION>
NINE MONTHS THREE MONTHS
YEAR ENDED ENDED ENDED
DECEMBER 31, SEPTEMBER 30, DECEMBER 31,
-------------- -------------- --------------
1997 1998 1998 1999 1998 1999
----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
REVENUES
Information and Applied
Technology....................... 96.7% 97.8% 98.9% 97.5% 95.2% 98.5%
Media and Entertainment............. 3.3 2.2 1.1 2.5 4.8 1.5
----- ----- ----- ----- ----- -----
TOTAL REVENUES........................ 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
COST OF REVENUES
Information and Applied
Technology....................... 85.2 92.2 92.9 92.7 90.6 85.8
Media and Entertainment............. 3.7 3.0 2.4 5.5 4.4 6.4
----- ----- ----- ----- ----- -----
TOTAL COST OF REVENUES................ 88.9 95.2 95.3 98.2 95.0 92.2
----- ----- ----- ----- ----- -----
Gross Profit.......................... 11.1 4.8 4.7 1.8 5.0 7.8
General and Administrative Expenses... 9.2 4.3 3.0 6.2 7.6 8.2
----- ----- ----- ----- ----- -----
Operating Income (Loss)............... 1.9 0.5 1.7 (4.4) (2.6) (0.4)
Interest Expense, net................. 0.2 0.3 0.3 0.9 0.5 1.1
Loss on Equity Method Investment...... 0.0 0.1 0.1 0.0 0.1 0.2
----- ----- ----- ----- ----- -----
Income (Loss) Before Income Tax
Benefit (Provision)................. 1.7 0.1 1.3 (5.4) (3.2) (1.7)
Income Tax (Provision) Benefit........ (0.7) 0.0 (0.6) 2.5 1.5 0.4
----- ----- ----- ----- ----- -----
Net Income (Loss)..................... 1.0% 0.1% 0.7% (2.9)% (1.7)% (1.3)%
===== ===== ===== ===== ===== =====
</TABLE>
From 1997 to 1999, most of our revenue was derived from U.S. Government
contracts entered into by our IAT Division. Total revenue for the three-months
ended December 31, 1999, the nine-months ended September 30, 1999 and for the
fiscal years ended December 31, 1998 and 1997 were $17.6 million, $55.3 million,
$60.9 million and $26.9 million, respectively, of which $17.4 million, or 98.0%,
$53.9 million, or 97.5%, $59.6 million, or 98.0%, and $26.0 million, or 97.0%
respectively, were generated by our IAT Division. For the three-months ended
December 31, 1999, the nine-months ended September 30, 1999 and for the fiscal
years ended December 31, 1999 and 1997 revenue attributable to our Media and
Entertainment Division was $0.2 million, $1.4 million, $1.3 million and
25
<PAGE> 30
$0.9 million, respectively. The increases in our total revenue and changes in
our revenue by division from 1997 through 1999 are illustrated by the following
table:
<TABLE>
<CAPTION>
REVENUE (IN MILLIONS)
----------------------------------------------------------------
TWELVE MONTHS NINE MONTHS THREE MONTHS
YEAR ENDED ENDED ENDED ENDED
DECEMBER 31, DECEMBER 31, SEPTEMBER 30, DECEMBER 31,
-------------- ------------- ------------- ------------
1997 1998 1999 1999 1999
----- ----- ------------- ------------- ------------
<S> <C> <C> <C> <C> <C>
Information and Applied
Technology................ $26.0 $59.6 $71.3 $53.9 $17.4
Media and Entertainment..... 0.9 1.3 1.6 1.4 0.2
----- ----- ----- ----- -----
Total Revenue:.............. $26.9 $60.9 $72.9 $55.3 $17.6
===== ===== ===== ===== =====
</TABLE>
The significant increases in revenue from our IAT Division from the twelve
months ended December 31, 1997 to the twelve months ended December 31, 1998 and
from the twelve months ended December 31, 1998 to the twelve months ended
December 31, 1999, are attributable to the fact that we commenced working on our
three largest U.S. Government contracts at different times. We worked on only
the first of the three contracts until October 1997. Thereafter, we commenced
working on the second contract and by June 1998, we were working on all three of
these U.S. Government contracts.
THREE MONTHS ENDED DECEMBER 31, 1999 AS COMPARED TO THE THREE MONTHS ENDED
DECEMBER 31, 1998
REVENUE. Revenue of the IAT Division for the three-month period ended
December 31, 1999 was approximately $17.4 million, as compared to $17.3 million
for the three-month period ended December 31, 1998, representing an increase of
0.6%. Of this revenue, we recognized $14.5 million from our three largest
Government contracts and $2.9 million from other IAT contracts in the three-
month period ended December 31, 1999 and $14.4 million from our three largest
Government contracts and $2.9 million from other IAT contracts in the
three-month period ended December 31, 1998.
Revenues attributed to our Media and Entertainment Division were $266,742
for the three-month period ended December 31, 1999, as compared to $864,816 for
the three-month period ended December 31, 1998, representing a decrease of
69.2%. In addition to Dynacs' shift from work-for-hire contracts to royalty
projects, the decrease in revenues was attributable to delays in obtaining
licensing sales of "The Adventures of Rin Tin Tin" colorized television series
which, in turn, caused delays in the recognition of revenues from such sales.
COST OF REVENUE. Cost of revenue of the IAT Division for the three-month
period ended December 31, 1999 was $15.1 million, as compared to $16.5 million
for the three-month period ended December 31, 1998, representing a decrease of
8.5%. For the three-month period ended December 31, 1999, $13.3 million, or
88.0%, in cost of revenue was attributable to our three largest Government
contracts and the balance of $1.8 million to other IAT contracts. In contrast,
$14.6 million, or 88.0%, of the cost of revenue for the three-month period ended
December 31, 1998 was attributable to those three contracts, while $1.9 million
of our cost of revenue was attributable to other IAT contracts. The decrease in
cost of revenue for the three-month period ended December 31, 1999 as compared
to the three-month period ended December 31, 1998 was primarily due to higher
gross profit margins of our other IAT contracts.
26
<PAGE> 31
Cost of revenue of the Media and Entertainment Division for the three-month
period ended December 31, 1999 was $1.1 million, as compared to $0.8 million for
the three-month period ended December 31, 1998, representing an increase of
37.5%. This increase in cost of revenue reflects the enhancements made to our
media production software, equipment upgrades and increased production capacity.
GENERAL AND ADMINISTRATIVE EXPENSES. Our general and administrative
expenses were $1.4 million for the three-month period ended December 31, 1999 as
compared to $1.4 million for the three-month period ended December 31, 1998.
Although operating expenses relating to bid and proposal costs decreased for the
period, operating expenses increased due primarily to increased legal fees in
connection with our litigation against Juno Pix and New Line Productions.
INTEREST EXPENSE. Net interest expense for the three-month period ended
December 31, 1999 was $188,209, as compared with interest expense of $95,035 for
the three-month period ended December 31, 1998, representing an increase of
98.0%. This increase was due primarily to:
- our increased use of our bank line of credit;
- increased financing of production costs associated with the acquisition
and development of digital media assets; and
- increases associated with additional capital financing from related party
loans.
NET INCOME (LOSS). We had a net loss of $(209,680), or $(.04) per share,
calculated on the basis of 5,355,259 shares, for the three-month period ended
December 31, 1999, as compared to a net loss of $(301,091), or $(.06) per share,
calculated on the basis of 4,913,081 shares, for the three-month period ended
December 31, 1998. This decrease in net loss was due primarily to improved gross
profit margins from our IAT Division.
NINE MONTHS ENDED SEPTEMBER 30, 1999 AS COMPARED TO THE NINE MONTHS ENDED
SEPTEMBER 30, 1998
REVENUE. Revenue of the IAT Division for the nine-month period ended
September 30, 1999 was approximately $53.9 million, as compared to $42.3 million
for the nine-month period ended September 30, 1998, representing an increase of
27.4%. Of this revenue, we recognized $47.1 million from our three largest U.S.
Government contracts and $6.8 million from other IAT contracts in the fiscal
year ended September 30, 1999 and $32.4 million from our three largest U.S.
Government contracts and $9.9 million from other IAT contracts in the nine-month
period ended September 30, 1998. The increase in revenue of the IAT Division
from the nine-month period ended September 30, 1998 to the fiscal year ended
September 30, 1999 is attributable, in part, to our recognition of a full
nine-months of revenue on our Scientific, Engineering, Technical, Administrative
and Related Task II contract with the NASA Glenn Research Center ("SETAR II
Contract") in the later period as compared to only four months of such revenue
during the nine-month period ended September 30, 1998, since work on the SETAR
II Contract did not commence until June 1998.
Revenues attributed to our Media and Entertainment Division were $1.4
million for the fiscal year ended September 30, 1999 as compared to $0.5 million
in the nine-month period ended September 30, 1998, representing an increase of
180.0%. This increase in revenue was due, in part, to our recognition of our
work-for-hire revenues attributable to colorization work for "The Adventures of
Rin Tin Tin."
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COSTS OF REVENUE. Costs of revenue of the IAT Division for the nine-month
period ended September 30, 1999 was $51.2 million, as compared to $39.8 million
for the nine-month period ended September 30, 1998, representing an increase of
28.6%. For the nine-month period ended September 30, 1999, $43.5 million, or
84.9%, in cost of revenues was attributable to our three largest U.S. Government
contracts and the balance of $7.7 million was attributable to other IAT
contracts. In contrast, $30.4 million, or 76.4%, of the cost of revenue for the
nine-months ended September 30, 1998 was attributable to those three contracts,
while $9.4 million, or 23.6%, of our cost of revenue was attributable to other
IAT contracts. The increase in costs of revenues from the nine-month period
ended September 30, 1998 to the nine-month period ended September 30, 1999 was
primarily due to a proportionate increase in IAT revenues over the same period.
Cost of revenues of the Media and Entertainment Division for the nine-month
period ended September 30, 1999 were $3.1 million, as compared to $1.0 million
for the nine-month period ended September 30, 1998, representing an increase of
210.0%. This increase in the cost of revenue were attributable, in a large part,
to the startup of our Batam, Indonesia facility.
GENERAL AND ADMINISTRATIVE EXPENSES. Our general and administrative
expenses were $3.4 million for the fiscal year ended September 30, 1999 as
compared to $1.3 million for the nine-month period ended September 30, 1998,
representing an increase of 162.0%. This increase is due primarily to bid and
proposal costs and fees incurred in connection with our litigation against Juno
Pix and New Line Productions. Bid and proposal costs totaled $0.5 million for
the nine-month period ended September 30, 1999, as compared to $0.4 million
during the nine-months ended September 30, 1998, while total legal fees and
expenses increased $1.1 million, over the same period. Of this amount, $0.5
million represents legal fees and expenses of the Juno Pix and New Line
Productions litigation and $0.2 million represents fees and expenses incurred in
connection with the settlement of an employee's claims alleged against us.
INTEREST EXPENSE. Net interest expense for the nine-month period ended
September 30, 1999 was $491,279 as compared to $109,415 for the nine-month
period ended September 30, 1998, representing an increase of 349.0%. This
increase was due primarily to:
- our increased use of our bank line of credit;
- increased financing of production costs associated with the acquisition
and development of digital media assets; and
- financing start-up costs of our work on the SETAR II Contract.
NET INCOME (LOSS). We had a net loss of approximately $1,606,411, or
$(.30) per share calculated on the basis of 5,398,778 shares, for the nine month
period ended September 30, 1999, as compared to net income of $342,107, or $.04
per share (on a fully diluted basis), calculated on the basis of 7,860,930
shares, for the nine-month period ended September 30, 1998. This decrease in net
income was due primarily to significant increases in:
- professional fees and expenses;
- depreciation expenses on fixed assets related to acquisitions of
approximately $3.9 million in capital equipment for our Media and
Entertainment Division;
- bid and proposal costs;
- interest expense;
- continued training of personnel and equipment costs for our overseas
facilities; and
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<PAGE> 33
- expenses of acquiring Cerulean Colorization, L.L.C. in August 1999.
FISCAL YEAR ENDED DECEMBER 31, 1998 AS COMPARED TO THE FISCAL YEAR ENDED
DECEMBER 31, 1997
REVENUE. Revenue of the IAT Division for the fiscal year ended December
31, 1998 was approximately $59.6 million, as compared to $26.0 million for the
fiscal year ended December 31, 1997, representing an increase of 129.0%. In
1998, we recognized $46.8 million from our three largest U.S. Government
contracts and $12.8 million from other IAT contracts as compared to
approximately $14.7 million from such U.S. Government contracts and $11.3
million from other IAT contracts in 1997. The increase in total revenue and
revenue of the IAT Division from 1997 to 1998 was primarily attributable to two
factors: our recognition of a full year of revenue on our Engineering
Development Contract with the NASA Kennedy Space Center ("EDC Contract") in 1998
as compared to only three months of revenue from this contract in 1997 and
commencement of work on the SETAR II Contract in June 1998.
The revenue of our Media and Entertainment Division was $1.3 million for
the fiscal year ended December 31, 1998, as compared to $0.9 million for the
fiscal year ended December 31, 1997, representing an increase of 44.0%. This
increase was attributable to increased volume of work-for-hire contracts.
COSTS OF REVENUE. Costs of revenue of the IAT Division for the fiscal year
ended December 31, 1998 was $56.2 million, as compared to $23.0 million for the
fiscal year ended December 31, 1997, representing an increase of 144.3%. For the
fiscal year ended December 31, 1998, $45.0 million of costs was attributable to
our three largest U.S. Government contracts and $11.2 million to other IAT
contracts. In contrast, the costs of revenue for the fiscal year ended December
31, 1997 was $23.0 million, of which $13.1 million was attributable to our three
largest U.S. Government contracts and $9.9 million to other IAT contracts. These
increases from 1997 to 1998 in the cost of revenue of our IAT Division were
attributable to the commencement of, or increase in the amount of work we
provided under our three largest U.S. Government contracts.
Cost of revenue of the Media and Entertainment Division for the fiscal year
ended December 31, 1998 was $1.8 million, as compared to $1.0 million for the
fiscal year ended December 31, 1997, representing an increase of 80.0%. This
substantial increase in the cost of revenue is attributable to the costs of
training new staff to produce colorization work at greater efficiency and
approximately $300,000 in depreciation resulting from our investment in
upgrading and expanding our digital colorization facilities in Patna, India
during the fiscal year ended December 31, 1998 as part of our ongoing effort to
build up the infrastructure for this Division.
GENERAL AND ADMINISTRATIVE EXPENSES. Our general and administrative
expenses were $2.6 million in the fiscal year ended December 31, 1998 as
compared to $2.5 million in the fiscal year ended December 31, 1997,
representing an increase of 4.0%. This increase is due primarily to an increase
in professional fees to $335,000 in the fiscal year ended December 31, 1998 from
$189,000 in the fiscal year ended December 31 1997.
INTEREST EXPENSE. Interest expense for the fiscal year ended December 31,
1998 was $204,450 as compared to $46,522 for the fiscal year ended December 31,
1997, representing an increase of 339.5%. This increase is due primarily to the
costs of financing:
- approximately $2.0 million of additional investment in our overseas
production facilities and
- $1.5 million in payroll costs for the SETAR II Contract, whose term
commenced in June 1998.
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<PAGE> 34
NET INCOME. We had net income of $41,016, or $0.01 per share (on a fully
diluted basis), calculated on the basis of 7,860,930 shares, for the fiscal year
ended December 31, 1998, as compared to net income of $263,533, or $0.03 per
share (on a fully diluted basis), calculated on the basis of 7,860,930 shares,
for the fiscal year ended December 31, 1997. The decrease in net income from the
fiscal year ended December 31, 1997 to the fiscal year ended December 31, 1998
was due primarily to lower billing rates on our Defense and Space Group Purchase
Contract with the Boeing Company ("Boeing ISS Contract") and increased operating
expenses of our overseas production facilities. We negotiated higher billing
rates for the Boeing ISS Contract for the fourth quarter of 1998 and the fiscal
year ended September 30, 1999. Income tax expense of ($178,571) was recognized
for the fiscal year ended December 31, 1997 compared to an income tax benefit of
$35,000, for the fiscal year ended December 31, 1998.
QUARTERLY RESULTS OF OPERATIONS
Our revenues and operating results may very significantly from quarter to
quarter due to a number of factors, many of which are outside our control. These
factors include:
- our ability to attract and retain customers and maintain customer
satisfaction for our existing and future businesses;
- our ability to attract new personnel and retain existing personnel;
- our ability to successfully integrate operations and technologies from
acquisitions or other business combinations;
- our ability to upgrade and develop our systems and infrastructure;
- new services or products introduced by our competitors;
- delays in contract start or end dates due to competitors protesting a
contract award by the U.S. Government;
- the timing and uncertainty of sales and contract procurement cycles;
- the timing and uncertainty of customers accepting delivery of our
products;
- the timing and uncertainty in U.S. Government budget appropriations;
- the timing and number of legal and customary holidays in a quarter;
- the timing of normally scheduled plant shutdowns by our customers;
- the dilutive effect of acquisitions; and
- general economic conditions and economic conditions specific to our
industries.
As a result, our operating results for any one particular quarter may not
be indicative of future operating results.
The following table sets forth unaudited quarterly consolidated statement
of operations data for each of the four calendar quarters in 1998 and 1999. In
the opinion of management, this information has been prepared substantially on
the same basis as the audited consolidated financial statements appearing
elsewhere in this prospectus, and all necessary adjustments, consisting only of
normal recurring adjustments, have been included in the amounts stated below to
present fairly the unaudited consolidated quarterly results. The quarterly data
should be read in conjunction with our audited consolidated financial statements
and unaudited financial statements for the periods ended
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<PAGE> 35
December 31, 1998, nine-months ended September 30, 1999, three-months ended
December 31, 1998 and 1999, (unaudited) and the notes to those statements
appearing elsewhere in this prospectus.
<TABLE>
<CAPTION>
THREE MONTHS ENDED
------------------------------------------------------------------------------------------------------------
MARCH 31, JUNE 30, SEPT. 30, DEC. 31, MARCH 31, JUNE 30, SEPT. 30, DEC. 31,
1998 1998 1998 1998 1999 1999 1999 1999
---------- ----------- ----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues
Information and
Applied
Technology......... $9,556,910 $12,685,463 $20,082,479 $17,290,418 $17,198,726 $17,435,961 $19,262,141 $17,363,517
Media and
Entertainment...... 55,000 258,500 153,100 864,816 574,927 0 823,330 266,742
---------- ----------- ----------- ----------- ----------- ----------- ----------- -----------
Total Revenues....... 9,611,910 12,943,963 20,235,579 18,155,234 17,773,653 17,435,961 20,085,471 17,630,259
Cost of Revenues
Information and
Applied
Technology......... 9,028,568 11,965,694 18,764,405 16,452,881 16,350,549 16,426,349 18,456,858 15,120,030
Media and
Entertainment.... 218,588 414,042 385,744 799,273 878,492 848,695 1,336,808 1,124,644
---------- ----------- ----------- ----------- ----------- ----------- ----------- -----------
Total Cost of
Revenues........... 9,247,156 12,379,736 19,150,149 17,252,154 17,229,041 17,275,044 19,793,666 16,244,674
---------- ----------- ----------- ----------- ----------- ----------- ----------- -----------
Gross Profit......... 364,754 564,227 1,085,430 903,080 544,612 160,917 291,805 1,385,585
General and
Administrative
Expenses......... 342,480 326,677 599,453 1,371,376 578,926 1,314,247 1,551,426 1,442,538
---------- ----------- ----------- ----------- ----------- ----------- ----------- -----------
Operating Income
(Loss)............. 22,274 237,550 485,977 (468,296) (34,314) (1,153,330) (1,259,621) (56,953)
Interest Expense,
net................ 22,014 49,715 37,686 95,035 128,669 189,689 172,921 188,209
Loss on Equity Method
Investment......... 16,759 16,762 16,759 16,760 9,289 9,289 9,289 33,518
---------- ----------- ----------- ----------- ----------- ----------- ----------- -----------
Income (Loss) before
Income Tax Benefit
(Provision)........ (16,499) 171,073 431,532 (580,091) (172,272) (1,352,308) (1,441,831) (278,680)
Income Tax
(Provision)
Benefit............ 6,863 (71,167) (179,696) 279,000 95,699 378,980 885,321 69,000
---------- ----------- ----------- ----------- ----------- ----------- ----------- -----------
Net Income (Loss).... $ (9,636) $ 99,909 $ 251,836 $ (301,091) $ (76,573) $ (973,328) $ (556,510) $ (209,680)
========== =========== =========== =========== =========== =========== =========== ===========
Diluted Net Income
(Loss) per share... $ (0.01) $ 0.01 $ 0.03 $ (0.04) $ (0.02) $ (0.18) $ (0.10) $ (0.04)
========== =========== =========== =========== =========== =========== =========== ===========
Diluted Weighted
Average Common and
Common Equivalent
shares............. 7,860,930 7,860,930 7,860,930 7,860,930 5,487,366 5,512,477 5,918,167 5,355,259
========== =========== =========== =========== =========== =========== =========== ===========
</TABLE>
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LIQUIDITY AND CAPITAL RESOURCES
GENERALLY
We have, historically, financed capital expenditures and working capital
requirements with revenues under our contracts and borrowings from related
parties and financial institutions. See "Certain Transactions." In January 1999,
we received an increase to our revolving credit loan facility from First
National Bank of Florida, which allows us to borrow ninety percent of our
receivables from engineering services (excluding commercial film colorization
receivables), up to a maximum loan of $4,000,000 bearing interest at the bank's
prime rate plus 2.0% per annum (10.75% as of February 29, 2000). As of March 24,
2000, an aggregate amount of $3,026,693 was outstanding under this credit
facility. The line of credit is secured by all of the assets of Dynacs. Dr.
Ramendra Singh has also provided a personal guaranty with respect to the credit
line. The line which matured on March 18, 2000 and has been extended to June 18,
2000. We have an outstanding term loan with First National Bank of Florida in
the amount of $141,171 as of March 24, 2000 which matures November 2000. The
loan, which was in the original amount of $400,000, is secured by certain assets
of Dynacs and is personally guaranteed by Dr. Singh.
Due to the relatively long procurement cycles of our IAT contracts, we can
ordinarily anticipate specific payroll financing needs under an IAT contract and
arrange an increase in short-term line of credit financing which is contingent
upon the award of that contract to us. The increased short-term financing is
secured by the accounts receivable to be generated by that particular contract.
The development and growth of our Media and Entertainment Division has,
since 1997, required expenditures that are highly capital intensive. These
expenditures included investments in production facilities, equipment, and the
cost of hiring and training personnel. In addition, we have required financing
in order to secure rights to media properties which we began acquiring in June
1998. We have employed a combination of income from operations, bank financing,
and loans from related parties to finance start-up costs and acquisition
expenses for our Media and Entertainment Division since starting this division
in the year ended December 31, 1996.
In order to finance our working capital shortfalls subsequent to September
30, 1999, we issued $2.9 million of Bridge Notes, before offering expenses of
$320,000, the net proceeds of which were used to fund working capital. This debt
is convertible into 483,334 shares of our common stock, assuming all of the debt
is converted. In addition, we issued to the purchasers of the Bridge Notes
warrants to purchase 488,500 shares of common stock at an exercise price equal
to 70.0% of the initial public offering price of the common stock per share. In
consideration for serving as placement agent of the foregoing bridge financing,
we issued to H.C. Wainwright & Co., Inc., the managing underwriter of this
offering, warrants to purchase 48,334 shares of our common stock at an exercise
price equal to 70.0% of the initial public offering price of the common stock
per share. See "Description of Company Securities -- Bridge Securities" and
"Underwriting."
CASH FLOW
The following is a summary of our cash flows. This summary is not intended
to replace the Consolidated Statements of Cash Flows included in the financial
statements accompanying this prospectus, but is instead intended to highlight
and facilitate understanding of the principal cash flow elements.
CASH FLOWS FROM OPERATING ACTIVITIES. Cash provided by or (used in) our
operations for the nine-month period ended September 30, 1999 and fiscal years
ended December 31, 1998 and December 31, 1997 was $331,097, $(832,594) and
$12,523, respectively. This change in cash flow between 1998 and 1999 resulted
primarily from a decrease in unbilled revenues, hence more
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<PAGE> 37
payments received. The significant change in our cash flow between 1997 and 1998
resulted primarily from the following: the substantial costs of start-up,
transition and payroll requirements for the SETAR II Contract beginning in June
1998; continued expansion of digital production facilities for our Media and
Entertainment Division in 1998; and the substantial costs of bids on prospective
contracts.
CASH FLOWS USED IN INVESTING ACTIVITIES. For the nine-month period ended
September 30, 1999, cash flows used in investing activities were $(1,556,904).
For the fiscal years ended December 31, 1998 and 1997, cash flows used in
investing activities were $(2,139,658) and $(933,863), respectively.
Expenditures during the fiscal years ended December 31, 1998 and December 31,
1997 were approximately $2,196,925 for continued expansion and upgrading of our
overseas digital production facilities, including purchases of digital video
production equipment and computer systems, and approximately $500,000 for
purchases of computers and other equipment to be used under the SETAR II
Contract. We anticipate spending approximately $2.75 million in the fiscal year
ended September 30, 2000 in continuing upgrades to our facilities in Batam,
Indonesia, Patna, India, and Hollywood, California, as we expand our digital
re-mastering work handled by our Media and Entertainment Division.
We also expect to continue funding additional capital expenditures and
working capital requirements from the proceeds of this offering, internally
generated cash flow, draw-downs on existing credit facilities and through future
debt and/or equity offerings.
CASH FLOWS FROM FINANCING ACTIVITIES. For the nine-month period ended
September 30, 1999, cash flows provided by financing activities were $2,147,103.
During the nine-month period ended September 30, 1999, we borrowed an additional
$752,571 under our line of credit and a net amount of $1,887,395 in loans from
related and unrelated parties. For the fiscal years ended December 31, 1998 and
1997, cash flows provided by financing activities were $2,605,890 and $887,658,
respectively.
We believe that cash flows from operations and proceeds from this offering
will be sufficient to meet any cash flow requirements of our operations,
requirements for funding of construction and development of capital assets, and
requirements for acquisitions of media assets for a period of at least twelve
months.
YEAR 2000 COMPLIANCE
We completed our assessment of internal systems that could be affected by
the year 2000 issue prior to December 31, 1999 and found that our computer
systems would properly utilize dates past December 31, 1999. We have initiated
communications with our significant suppliers to determine the extent to which
we are vulnerable to those parties' failure to solve their own year 2000 issues.
We will develop contingency plans in the event we become aware that one or more
of these third parties fails to solve their year 2000 issues in such a way as to
affect our operations. If significant numbers of these third parties experience
failures in their computer systems or equipment due to year 2000 non-
compliance, it could affect our ability to engage in normal business activities.
The statement contained in the foregoing year 2000 readiness disclosure is
subject to protection under the Year 2000 Information and Readiness Disclosure
Act.
PRINCIPLES OF CURRENCY TRANSLATION
In the year ended December 31, 1998 substantially all of our revenue was
generated in U.S. dollars. In the same year we incurred the majority of our
expenses in U.S. dollars and the balance in Indian Rupees or Indonesian Rupiahs.
Items required to be included in our financial
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<PAGE> 38
statements are translated into U.S. dollars using the average monthly exchange
rate for revenues and expenses and the period end rate for assets and
liabilities. Gains and losses resulting from this translation are reported in
our financial statements as accumulated other comprehensive loss, a separate
component of stockholders' equity. We expect that a majority of our revenue will
continue to be generated in U.S. dollars for the foreseeable future and that a
majority of our expenses, including personnel costs as well as capital and
operating expenditures, will continue to be denominated in U.S. dollars. In the
short term, consequently, we do not anticipate that our results of operations
will be significantly affected to the extent that the Rupee and/or Rupiah
appreciate or depreciate against the dollar.
EFFECTS OF INFLATION
The effects of inflation and changing prices have not had a significant
impact on our revenue or income from continuing operations during our last three
fiscal years. As a developer of applied technologies, the most significant of
our costs to date are the salaries and related benefits for our employees. As
with other technology-based service providers, we must anticipate adequate
increases in wages and other costs, particularly for our long-term contracts.
Historically, our wage costs in India and Indonesia have been significantly
lower than prevailing wage costs in the United States for comparably-skilled
employees, although wage costs in India and Indonesia are currently increasing
at a faster rate than those in the United States. We cannot assure you that we
will be able to recover increases in these costs by increasing the prices we
charge for our services.
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BUSINESS
OVERVIEW
We develop advanced technologies in the areas of information systems and
aerospace/satellite systems and operations for U.S. Government agencies and
private sector clients. Our business strategy is to develop commercial
applications for the technologies and know-how developed by us in our
information and aerospace businesses to create and grow new businesses with
strong profit potential. To date, the most significant commercial applications
of our proprietary technologies have been our digital color re-mastering and
digital masking technologies which our Media and Entertainment Division use to
colorize short-form and long-form black-and-white film footage and other media
into digital color material. To further this strategy, we have spent over $4.0
million in the twelve-month period ended December 31, 1999 to build the
infrastructure to grow our digital media and entertainment business, including
the development of digital re-mastering production tools and upgrading existing
facilities. As part of our media and entertainment business expansion, we began
in 1998 to acquire for our own account, media products for colorization, while
continuing to provide work-for-hire colorization services. We believe that we
are the leading provider of cost-effective processes to convert large volumes of
black-and-white films and other media into digital color material. Our clients
for these services include, among others, The Walt Disney Company and Columbia
Pictures Television Group, a division of Sony Corporation. We also intend to
leverage our information and digital server technologies to develop
Internet-based distribution and business-to-business and business-to-consumer
delivery of digital media products and services through our MarketYourMedia.com
website.
During the nine-month period ended September 30, 1999, our gross revenues
exceeded $55.0 million, and at December 31, 1999, our total contract backlog was
$207.9 million. Of this amount, $34.9 million represented funded backlog and
$173.0 million represented unfunded backlog.
OUR DIVISIONS
Through the application of our core technologies, our business has evolved
into two divisions:
- Digital Media and Entertainment Division; and
- Information and Applied Technology Division.
The business of each division, including the markets for our services and
our competitors, is described below.
DIGITAL MEDIA AND ENTERTAINMENT DIVISION
SERVICES OFFERED. Through our production facilities in India and
Indonesia, we offer digital re-mastering, color effects and animation services
for media owners worldwide, including the following:
- DIGITAL CONVERSION OF BLACK-AND-WHITE FILM MEDIA. We convert
black-and-white media, such as motion pictures, television series and
film clips of historic and newsworthy events, to color;
- DIGITAL COLOR SPECIAL ENHANCEMENTS AND EFFECTS. We provide digital color
treatments and special effects for producers of television commercials
and music videos;
- ELECTRONIC PAINTING OF ANIMATED MEDIA. We utilize digital computer
software to apply color to animated cartoons. This service is referred to
in the industry at "digital ink and paint";
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- FILM AND VIDEO RESTORATION. Our restoration services utilize digital
processes to enhance and improve the appearance of degraded films and
videos; and
- 2-D AND 3-D ANIMATION. Our animation services utilize 2 and 3
dimensional computer graphics tools and software applications to produce
animated media in both the entertainment and applied technology areas of
our business.
Examples of the application of our digital re-mastering, color effects and
animation technologies and services include the following:
- Digital color re-mastering of black-and-white feature films, such as "The
Absent Minded Professor" for The Walt Disney Company and "Le Trou
Normand" for Roissy Films;
- Digital color re-mastering of black-and-white television series, such as
"I Dream of Jeannie" and "Bewitched" for Columbia Pictures Television
Group, a division of Sony Corporation;
- Digital re-mastering of black-and-white film clips showing the crash of
The Hindenburg Airship and The Battle of Midway;
- Color special effects for television series, such as "The X-Files," and
for numerous television commercials, including the recent Gatorade and
Coca-Cola commercials;
- Color special effects for music videos, including one featuring the
pop-musical performer, Tatyana, produced by Sony Music and "Celebrity
Skin" produced by Crash Films, featuring Courtney Love;
- Digital ink and paint services, such as that provided for the animated
short film "Monkey Love" and the On-line Cartoon Network;
- Digital restoration of black-and-white film clips of famous World War II
battles and the digital disassembly, restoration and re-assembly of
cartoon animation, such as "Woody Woodpecker"; and
- Digital video production, digital photography, 3-D animation and web-site
development and implementation services, such as that provided for the
Multi-media Laboratory at NASA's Kennedy Space Center.
COLORIZATION AND ANIMATION TECHNOLOGIES. The primary benefits of our
digital color re-mastering and animation services are cost effectiveness, high
delivery speed for long-form media, and worldwide access to real-time production
information, all without sacrificing quality. Our technologies were designed to
address deficiencies in the pioneering colorization technologies which were
developed as early as two decades ago. Deficiencies in the early technologies
included: poor, unrealistic quality, particularly in the early analog technology
which was only capable of producing 8 to 16 colors; inefficiencies resulting
from small production capacity and length of time required for completion of
colorized material; and high production costs.
Currently available technologies, including ours, have made it possible to
produce digital color images in over 16 million colors that are realistic and
aesthetically pleasing. The inefficiencies and expense of early colorization
technologies resulted from the use of highly skilled artists, whose services
were costly and time-consuming. These inefficiencies were less apparent for work
on short form media (which is comprised of hundreds to thousands of frames) as
compared to long form material (which is comprised of hundreds of thousands to
millions of frames).
Our proprietary technologies reduce labor costs by using computers, rather
than skilled artists, to handle substantial portions of the colorization.
Although our colorization processes are still labor
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intensive, they are far less labor intensive than other colorization
technologies. We also achieved further savings in labor and other production
costs by establishing overseas production facilities in Patna, India and the
Indonesian Island of Batam, which we continue to expand. See "Facilities" and
"Government Regulation -- India and Indonesia."
Through our digital ink and paint technology, we are able to add color to
animated videos and films electronically, rather than the traditional method of
painting each character that appears in a frame on a separate celluloid sheet.
In addition to saving labor costs, this technology greatly speeds up the process
of colorizing animated media and creates further cost efficiencies by
eliminating the need for celluloid frames which scratch, become degraded over
time and require shipping.
Our computerized technologies also enable us to divide the millions of
frames of a television series or feature film or the thousands of frames
comprising a commercial, into many separate projects that can each be worked on
simultaneously by different employees. This feature not only allows us to
distribute the work equally among our production employees, but in doing so,
also significantly shortens the time required to complete a project. As a
result, we believe our labor and other production costs are far lower than those
of our competitors, especially for colorization of long form media. In the past,
colorizing a motion picture could cost its owner approximately up to $300,000 to
$500,000. Digital technology has reduced this cost to approximately $150,000 to
$200,000, and our technology further reduces this cost.
REAL TIME PRODUCTION INFORMATION. Another significant feature of our
digital production technology is worldwide access to real-time production
management information. Our web-based production management tools allow our
production supervisors and managers to monitor, in real-time, the status of work
in process, including individual frames and shots, from their desktop computer.
This technology allows us to monitor and better manage our facilities and labor
abroad with substantial cost savings.
REVENUES FROM COLORIZATION SERVICES. In general, we are paid for work by
each minute of footage that we process. We also accept reduced rates for
colorization work in exchange for a percentage of the ownership of the completed
work. As a part owner of digital color re-mastered movies and TV series, we
receive a percentage of the licensing or distribution fees realized. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations."
RECENTLY COMPLETED PROJECTS. We have colorized films and television series
for Columbia Pictures Television, Le Film Arianne, Roissy Films and The Walt
Disney Company. These projects included the TV series "I Dream of Jeannie,"
"Bewitched" and "The Adventures of Rin Tin Tin" for Columbia Pictures Television
Group, the Disney feature films "The Absent Minded Professor" and "Son of
Flubber," and the feature films "Le Boulanger de Valorgue" and "Le Trou
Normand," for Roissy and "Fan Fan Les Tulipe" for Le Film Ariane. Our
colorization work on commercials, music videos and special effects for
television includes special effects for the TV series, "The X-Files," and for TV
commercials advertising Gatorade, Coca Cola, Club Med, Miller Beer, Lexus,
Mercedes Benz, Peugeot, Citroen, Lincoln Mercury and Pontiac, Tostitos, Woolite,
Barclaycard, RCN Cable and ESPN. Our own projects include a 13-episode series on
World War II, "Annie Oakley" and a joint project on "Circus Boy." We are
currently considering offers to purchase and colorize certain television series,
including "Lassie," "Route 66," "Naked City," and "Laurel and Hardy" as well as
working with the Sherman Grinberg Film Library to develop two additional series.
FUTURE DIGITAL MEDIA PROJECTS
INTERNET-BASED MEDIA LIBRARY AND MARKETPLACE. We also intend to leverage
our information, digital media server and Internet technologies to complete the
development of our web site,
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"MarketYourMedia.com." Through MarketYourMedia.com, we intend to position Dynacs
as a seller and distributor of visual media assets over the Internet. Once our
web site is in operation, we plan to use this web site as an on-line media
library and marketplace where we and other owners of digitized visual media can
sell material to prospective licensees and consumers. These prospective
customers will be able to search an on-line catalog of available materials and
down-load selected materials for viewing. For material to be provided to, or
for, third parties, we will act as an intermediary receiving fees for properties
licensed through MarketYourMedia.com. We anticipate receiving fees from these
media owners for scanning, digitizing, colorizing, cataloging and archiving
their materials.
LOCATION-BASED ENTERTAINMENT. We intend to market our technologies to
location-based entertainment sites, or "LBEs," which are out-of-home
entertainment locations featuring technology-driven, electronic entertainment,
typically in the form of electronic, virtual reality games and motion-ride
simulation in 3D. LBEs occupy sites ranging in size from 6,000 square feet or
less to 100,000 square feet and are being developed by divisions of the large
entertainment studios such as The Walt Disney Company (DisneyQuest Imagineers),
Sony Corporation and Gameworks, a joint venture among DreamWorks SKG, Sega
Enterprises and Universal Studios, as well as many independent operators.
Our primary target market is the independent LBE operators and
entertainment conglomerates. We can provide cost efficiencies to independent
operators since most operators currently secure the different technology
components of their LBEs from various sources at significant expense.
MARKETS FOR DIGITAL MEDIA AND ENTERTAINMENT DIVISION
The entertainment industry creates motion pictures, television programming
and interactive multimedia content for distribution through theaters, video
stores, pay and basic cable television stations, direct-to-home private cable,
broadcast television, on-line services, and location-based entertainment
centers. Television operators and producers purchase content through trade shows
and distributors. Film and television libraries may be released repeatedly in
distribution, while new content is typically released into a "first-run"
distribution channel and later into one or more additional channels or media.
Entertainment content produced in the United States is also exported.
Trends in the entertainment industry that affect the markets for our
digital media and entertainment products and services are:
- Growth in worldwide demand for entertainment content;
- Increasingly high demand in international markets for United States
entertainment content, including television programs;
- Development of new markets for existing content libraries; and
- Wider application of digital technologies for manipulation and
distribution, including the emergence of new distribution channels.
TELEVISION MARKET. Programming for television is purchased by conventional
broadcast television networks, cable channels, satellite delivery systems, and
pay television. The demand for entertainment content generally has increased
significantly as a result of the growth in numbers and types of television
channels in the United States and worldwide. The demand for entertainment
content, including television content, has increased significantly as a result
of the proliferation of television channels, increased cable penetration and the
growth of home video. Higher levels of spending for programming has resulted
from demand by new television networks and cable stations for more hours of
programming and competition for new viewers. Significant growth in worldwide
television revenues
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has resulted from the increased number of households with televisions and the
increased growth of cable and multi-channel access. The increased revenues have
led to increased expenditures for programming. We believe that colorized
libraries of existing black-and-white programs will become an attractive
alternative for purchasers of programming. We intend to position ourselves to be
able to meet the increased demand for such colorized libraries.
The privatization of broadcasting systems during the last decade or so, the
proliferation of broadcast licenses and the introduction of sophisticated
delivery technologies, such as cable and satellite transmission systems and the
Internet, has led to significant growth of broadcast and cable television
markets outside North America. European governments have continuously encouraged
a major expansion of public and private broadcasting sectors. It has been our
experience that European television producers do not typically purchase
black-and-white content, and we believe that Western Europe is and will continue
to be an important market for content colorized by Dynacs. The markets for
television content are also growing in Asia and Eastern Europe.
The growth in demand for programming and the proliferation of television
channels is related to the substantial increase in the number of households with
televisions worldwide. According to figures released by Kagan.com, in 1999, over
888 million households had televisions, and the number of such households is
expected to increase by 9.5% to more 972 million by the end of 2003. A November
1999 report of Kagen Media Appraisals, Inc. projects that between 1999 and 2003,
growth in worldwide revenues of all types of television channels as follows:
Over 30.0% in the United States; over 68.0% in the Asia-Pacific market; over
61.0% in Latin America; over 39.0% in Western Europe; and over 276.0% in Eastern
Europe.
The number of broadcast networks and cable channels in the United States
and worldwide continues to increase. Since 1994 more than 165 new cable networks
have been introduced worldwide.
Programming budgets of basic cable networks identified as potential
purchasers of colorized television series from companies such as Dynacs are
projected by Kagen Media Appraisals, Inc. to increase from $2.19 billion in 1999
to more than $3.75 billion in 2004.
There was significant growth in worldwide revenues for the television
industry resulting from the increasing number of households with televisions,
the number of households with multi-channel access, basic cable television
operators and increased television advertising revenues. Spending for television
advertising, which drives the sale of existing content libraries and the
production of new programming, reached over $37.5 billion in 1998 as compared to
more than $29.0 billion in 1990.
The increasing programming budgets for the major networks create demand for
the new content. In view of the increasing costs attached to the creation of new
programming, the colorized libraries of existing black and white programming
have become an attractive option. We anticipate continuing to provide our
products and services to new programming content providers to capitalize on the
continued growth in this market.
Despite the increasing cost of programming, not all purchasers of
television programming can afford these rates. The proliferation of smaller,
independent channels, domestic and international, appealing to audiences of
narrow demographics have comparatively smaller programming budgets. These
channels often resort to repurposed content, such as colorized black and white
programming. We anticipate benefitting in two ways from this trend: 1) demand
for new colorized content, wherein we will provide our services to colorize the
content, and 2) demand for existing colorized content, wherein we will provide
content owned or partially owned by us.
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The U.S. entertainment industry is also experiencing a broad transition
from traditional analog film processes to digital methods and approaches. We
believe that our ability to convert visual media in analog format to digital
formats positions us to take advantage of this transition.
MULTIMEDIA INDUSTRY. The interactive multimedia industry encompasses video
games, on-line and interactive services, and location-based entertainment. While
certain segments of this industry are well established, it is an emerging
business with significant growth potential. Improvements in technology, the
availability of communication bandwidth, the proliferation of distribution
channels for such entertainment products and services and the involvement of
large entertainment companies are evidence of such growth. Numerous companies
provide web site design and technologies that integrate various forms of media,
including live action video, animation, graphics and audio. Other interactive
on-line services such as video-on-demand are being deployed by cable television
operators and certain regional telephone companies. Although we do not derive
significant revenues from these markets at the present time, we believe that our
digital production, visualization and simulation technologies will be marketable
to the multimedia industry for location-based entertainment, video compression,
digitizing material for video games and other on-line content and development of
more complex applications such as digital versatile disk (DVD) and server-based
on-demand services.
MARKETYOURMEDIA.COM. The market for our digital color library and
distribution services include the sector of the traditional television and film
industries that now purchase stock footage for documentaries and other
programming off-line from stock footage companies. These industries use stock
footage both to depict historical matter and to substitute existing footage,
where available, for new footage. Through our MarketYourMedia.com web site,
purchasers of stock footage will be able to purchase on-line stock footage owned
by Dynacs and third parties rather than through the current inefficient process
of selecting and purchasing stock footage off-line by approaching each stock
footage company individually, describing the type of footage required, and
waiting for delivery. Purchasers of stock footage will be able to search a
digitized catalog of footage, view it, and select and order footage, all through
our web site. They will also have access not only to the footage owned by stock
footage companies but also that of others, including consumers for whom we will
act as an intermediary. As an intermediary of visual media, we will receive fees
for digitizing, hosting and transacting services and a licensing fee for each
on-line sale.
Another market for this web-enabled business will be acquisitions of
television series and films for television and theatrical distribution. This
market is currently served through sales conventions, where sellers and buyers
meet to review video and film productions available for licensing. These
conventions typically last three or four days and are held only at discrete
times and locations during a year. Exhibitors at these markets range from small
independent producers and distributors, who budget anywhere from $10,000-$50,000
for the costs of exhibiting per market, to large television and motion picture
studios that send upwards of 50 to 75 people to each market with multi-million
dollar budgets for exhibiting. Additionally, when broadband technologies with
capacity for transmitting large volumes of visual media on-line with greater
capacity and efficiency are developed and gain widespread use, we will target
these traditional market participants with e-commerce and technology solutions
that will provide an efficient, on-line marketing and distribution of their
media assets. Revenues will be generated by a combination of fees paid for
technical services and transaction fees based on a percentage of sales
generated.
INFORMATION AND APPLIED TECHNOLOGY DIVISION
We operate our IAT Division to focus on the functional business needs of
information systems management and development and on satellite/aerospace
systems and operation.
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INFORMATION SYSTEMS MANAGEMENT AND DEVELOPMENT SERVICES OFFERED. Our work
in the area of information systems management and development includes:
- INTERNET ENABLEMENT. We provide legacy system renewal and re-engineering
to update old computerized information systems, such as those which
predate the Internet, to enable them to work with the latest Internet
technology, in place of installing entirely new software systems at much
greater expense.
- WEB SITE DATABASE DESIGN AND IMPLEMENTATION. We offer interactive web
site development services to companies that require database and tool
development. We currently offer these services directly to our customers
and through a joint-marketing effort with Rimric Corporation, an
award-winning web site design firm that focuses on the aesthetic appeal
of their clients' web sites.
- INFORMATION SYSTEM MAINTENANCE/SUSTAINING ENGINEERING. Although
companies often maintain and upgrade software applications they have
acquired in the marketplace, it is becoming more and more common for
companies to use outside consultants to perform this service. Dynacs
offers these services, which are often referred to as application
development, software maintenance and user support. Dynacs has performed
application development and sustaining engineering services for HMC,
Inc., CST, Zen Entertainment, The Netherlands Development Organization
and Medical High Technology International.
We offer clients substantial cost-savings for the more labor-intensive
aspects of our assignments in this field by using the resources of our software
development facility in Bangalore, India.
Clients of our information development and management division include U.S.
Government agencies and private clients in a broad spectrum of businesses.
Additional applications of our information technology services for public and
private sector clients include:
- SYSTEMS INTEGRATION FOR ISS. We are integrating certain information
systems for the International Space Station under multiple contracts with
The Boeing Company. The ISS program represents the combined efforts of
hundreds of contractors and suppliers from 15 different countries. It is
the largest international aerospace project ever undertaken. Other
contributions by Dynacs under these contracts include:
-- Integration of communications data used by various participants;
-- Integration of physical systems, including parts of the ISS that will
be assembled on Earth and in space; and
-- Work on the ISS Software Verification Facility for testing flight
operations control software.
- BUSINESS SYSTEMS INTEGRATION AND RE-ENGINEERING FOR SPACE SHUTTLE. Under
a three-year contract for the Shuttle Program at the Johnson Space
Center, we are undertaking business systems integration and
re-engineering to enable NASA to manage data regarding multiple contracts
kept on different information systems.
- BUSINESS CASE SOFTWARE RE-ENGINEERING FOR COMMERCIAL CLIENT. We
re-engineered software applications for HMC Inc., a management consulting
firm that advises Fortune 1,000 companies on their information systems.
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COMMERCIAL MARKETS FOR INFORMATION SYSTEMS MANAGEMENT AND DEVELOPMENT DIVISION
INDUSTRY OVERVIEW. In the increasingly competitive business environment,
companies have become dependent on information technologies to maintain
day-to-day operations and as a strategic tool to enable them to re-engineer
business processes, restructure organizations and react quickly to changes in
competitive conditions, regulatory requirements and technology. Information
technologies are particularly critical to the operations and competitive
position of certain markets that are undergoing rapid deregulation and
globalization such as telecommunications, financial services and utilities. As
companies and Government agencies have become increasingly reliant on their
information systems, the challenge of managing such systems has also grown. Not
only must companies and governments implement new technologies such as
client/server systems and advanced databases, but they must also maintain and
update legacy systems to work with the latest software and hardware, expand
functionality, recognize and process dates that begin in the Year 2000, and
handle non-technology-based developments such as conversions to Euro-currency.
MARKET SIZE. As businesses and governments have become more dependent on
information technologies, corporate budgets for consulting, development,
integration and outsourcing of information technology services have grown
dramatically. Dataquest has estimated that the worldwide market for consulting,
development, integration and outsourcing in the area of information technologies
will increase to $291.0 billion in 2001 from $177.0 billion in 1998, as
businesses concentrate on their core competencies and attempt to minimize fixed
costs and restrict growth of internal staffing. The need to outsource is
particularly acute for companies whose information technology personnel lack the
requisite skills and abilities in project management to implement new
technologies. Outsourcing is also growing among U.S. Government agencies
operating under reductions of staffing budgets. As a result, these companies and
U.S. Government agencies seek third-party service providers to implement new
technologies and upgrade existing legacy systems. Businesses and government
entities are also able to reduce the time required to complete large information
technology projects by shifting some or all of their responsibilities to
consultants.
The markets for our technologies and services in the areas of information
systems management and development include agencies of the U.S. Government,
primarily NASA. Although significant in size, they are not expected to grow. On
the other hand, NASA and other Government agencies are currently out sourcing a
substantial portion of this type of work and are expected to continue to do so.
In addition, we are currently providing information technologies and services to
NASA and the U.S. Air Force under a number of multi-year contracts. See
"Satellite and Aerospace Systems and Operations Division" and "Government
Markets for Satellite/Aerospace Systems and Operations -- Major Client" below.
COMPETITION IN COMMERCIAL MARKETS
The market for information technology services is highly competitive. Our
competitors include companies that specialize in providing services in the area
of information technologies, large international accounting firms and their
consulting affiliates, systems consulting and integration firms, temporary
employment agencies, other technology companies and in-house client MIS
departments. Our competitors include international firms as well as national,
regional and local firms located in the United States, Europe, Asia and South
America.
We expect that future competition will increasingly include firms with
operations in other countries, potentially including countries with lower
personnel costs than those prevailing in India. Part of our competitive
advantage is a cost advantage relative to other service providers in the United
States and Western Europe.
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SATELLITE AND AEROSPACE SYSTEMS AND OPERATIONS
We have undertaken sophisticated research and development, analysis and
testing for numerous private and public sector clients in the U.S. and European
satellite and aerospace industries. Although we began as an engineering firm
with expertise focused in the area of multi-body dynamics and control, we have
greatly expanded the scope of our technical expertise. We are now involved in
many high-profile U.S. space programs and cutting-edge research projects. We
also develop technologies and applications in the areas of satellite systems and
operations from launch through orbit and landing. In this field, we also develop
information systems and training software and procedures for the systems we
provide.
SERVICES PROVIDED. Representative applications of our technologies in this
area for public and private sector clients are:
- Enhancement of satellite operating software for Hughes Space and
Communications Group, a division of General Motors;
- Development of information systems for operation of satellites launched
under NASA's Mission to Planet Earth under a subcontract with TRW Inc.;
- Development of hardware and software to upgrade rocket launch systems at
the Kennedy Space Center under our EDC Contract; and
- Development and application of simulation software allowing parallel
processing -- independent use of systems to perform different functions
simultaneously -- for NASA's Johnson Space Center.
MARKETS FOR SATELLITE/AEROSPACE SYSTEMS AND OPERATIONS
The markets for Dynacs' satellite and aerospace systems and operations are
the global information and communications industry, the orbital systems and
exploration market, for which U.S. and European governments are the primary
customers, and to a much smaller extent, U.S. Government defense agencies, of
which only the Air Force is a current Dynacs customer. The worldwide commercial
markets for the services we provide in the area of aerospace/satellite systems
and operations is expected to grow to $81.1 billion in 2009 according to the
Teal Group Corporation. This figure includes the $56.1 billion estimated value
of the 899 new satellites expected to be launched and $25.0 billion in estimated
value of related launch services. The anticipated growth reflects the dramatic
growth projected in the global communications and information industry and the
availability of new supporting technologies.
GOVERNMENT MARKETS FOR SATELLITE/AEROSPACE SYSTEMS AND OPERATIONS
MAJOR CLIENT. The bulk of the services provided to date by our information
systems management and development and satellite/aerospace systems and
operations divisions have been provided to U.S. Government agencies. Revenues
from services we provided as a contractor or subcontractor to U.S. Government
agencies, primarily through our information technology and satellite/aerospace
businesses, represented the following portions of our total revenue: 97.5% for
the nine-months ended September 30, 1999, or $53.9 million, 98.0% for the year
ended December 31, 1998, or $59.6 million; and 97.0% for the year ended December
31, 1997, or $26.0 million. Accordingly, a substantial portion of our revenues
are subject to inherent risks, including uncertainty of economic conditions,
changes in government policies and requirements that may reflect rapidly
changing military and political developments and the availability of funds.
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During the nine months ending September 30, 1999, our three largest
contracts represented the following portions of our total revenue: 40.2%, for
the SETAR II Contract; 34.97%, for the EDC Contract; and 10.0%, for the Boeing
ISS Contract. For the three months ending December 31, 1999, our three largest
contracts represented the following portions of our total revenue: 38.9%, for
the SETAR II Contract; 31.85%, for the EDC Contract; and 12.1%, for the Boeing
ISS Contract.
NASA is our direct customer on the SETAR II Contract and EDC Contract and
is indirectly our customer under the Boeing ISS contract; hence, effectively,
NASA is our customer under our three largest contracts. For the nine months
ending September 30, 1999, our three largest contracts represented a total of
85.2%, or $47.1 million, of our revenues. For the three months ending December
31, 1999, our three largest contracts represented 82.1%, or $14.4 million, of
our revenues.
The industry is also characterized by difficulty in forecasting costs and
schedules when bidding on developmental and highly sophisticated technical work.
Certain risks inherent in the current U.S. Government contracting environment
for information technology and aerospace services are discussed in the sections
of this prospectus entitled "Risk Factors" and "Management's Discussion and
Analysis of Financial Condition and Results of Operations."
U.S. GOVERNMENT CONTRACTS. There are three types of U.S. Government
contracts under which we may serve as a prime contractor or subcontractor:
- cost reimbursable contracts;
- time-and-materials contracts; and
- fixed price contracts.
We currently have cost reimbursable contracts and time-and-materials
contracts.
Our cost reimbursable contracts include both cost plus fixed fee contracts
and cost plus award fee contracts.
Under cost plus fixed fee contracts, we receive a fee which is fixed by the
contract and reimbursement of costs to the extent allowed under Federal
Acquisition Regulations. Under cost plus award fee contracts, we are reimbursed
for costs on the same basis and receive a fee which varies, depending upon cost,
quality, delivery and the agency's subjective evaluation of the work. Under
time-and-materials contracts, we receive a fixed amount by labor category for
services performed and are reimbursed for the cost of materials we purchase to
perform the contract. Under fixed price contracts, contractors for the U.S.
Government receive a fixed amount regardless of the costs we incur. Our costs
and fees under U.S. Government contracts are subject to adjustment as a result
of audits by the Defense Contract Audit Agency.
We may obtain a U.S. Government contract after the solicitation by the
relevant U.S. Government agencies, in open and free competition, or in
competition only with other companies that qualify as small businesses or small
disadvantaged businesses. See "Satellite and Aerospace Systems and Operation
Division -- Competition for U.S. Government Projects." Under certain
circumstances, most U.S. Government agencies are authorized to enter into
contracts based on negotiation rather than sealed bids. Negotiated contracts may
or may not involve the solicitation of competitive proposals. Generally,
negotiated contracts are entered into without competitive solicitation when the
services or supplies desired by a U.S. Government agency can reasonably be
obtained from only one available source. In most non-competitive procurements, a
U.S. Government agency solicits a proposal from the contractor and then
negotiates the price and other terms in accordance with applicable U.S.
Government regulations.
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U.S. Government contracting laws also provide that the U.S. Government is
to do business only with responsible contractors. In this regard, U.S.
Government agencies have the authority, under certain circumstances, to suspend
or debar a contractor or subcontractor from further U.S. Government contracting
for a certain period "to protect the U.S. Government's interest." Such action
may be taken for various reasons, including commission of fraud or a criminal
offense in connection with a U.S. Government contract or subcontract. A
suspension may also be imposed if a contractor is indicted for such matters. In
the event of any suspension or debarment, our existing contracts and
subcontracts would continue unless terminated or canceled by the U.S. Government
under applicable contract provisions.
TERMINATION BY THE U.S. GOVERNMENT. A substantial portion of our revenue
is currently generated from contracts with NASA and, to a lesser extent, the
U.S. Air Force. These contracts are conditioned by their terms upon the receipt
by NASA of an adequate appropriation of funds from the U.S. Congress each year.
In the event that NASA fails to receive funds from Congress or Congress
withdraws prior appropriations, NASA may terminate its contracts with us "for
convenience." Upon termination of a government contract "for convenience," we,
like other U.S. Government contractors and subcontractors, would be entitled to
be reimbursed for allowable costs and profits to the date of termination.
Contracts with agencies of the U.S. Government are also subject to reduction or
modification in the event of changes in U.S. Government requirements or
budgetary constraints. For each of the U.S. Government's 1999 fiscal year and
2000 fiscal year, Congress authorized $13.7 billion in appropriations for NASA,
for International Space Station ("ISS"), launch vehicles and payload operations,
including funding for the Kennedy Space Center, and for science, aeronautics and
technology.
BACKLOG
Our backlog under contracts with customers in our information systems and
aerospace/satellite systems and operations business is comprised of funded and
unfunded components. As of December 31, 1999, the total dollar amount of funded
backlog was $34.9 million and unfunded backlog was $173.0 million. Unfunded
backlog can include an amount up to the stated award value of the contract,
including renewals or extensions that have been priced, but as to which the
agency retains authority to fund or not to fund. Because many of our contracts
are multi-year contracts, total backlog may include revenue expected to be
realized several years into the future. The unfunded backlog may not be an
indicator of future contract revenue or earnings because funding of the unfunded
portion cannot be assured. Many of the U.S. Government programs in which we
participate may extend for several years, but they are normally funded on an
annual basis by Congressional appropriations.
COMPETITION FOR U.S. GOVERNMENT PROJECTS
Our information management and development and aerospace/satellite systems
and operations divisions compete with many other companies for contracts
covering a variety of U.S. Government projects and programs in the areas of
information, satellite and aerospace technologies. We now compete for these
contracts where bidding is "free and open" and not restricted, and where bidding
is restricted to small disadvantaged businesses or SDBs. Our ability to compete
successfully for and retain U.S. Government contracting business is highly
dependent on technical excellence, management proficiency, strategic alliances,
cost-effective performance and the ability to recruit and retain key personnel.
Our competitors for U.S. Government contracts are typically much larger
firms with substantial assets, some of which have become considerably larger in
recent years as the result of substantial
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consolidation of the industry. On-going consolidation of the U.S. and global
defense and aerospace companies has resulted in a reduction of the number of
prime contractors for NASA and the U.S. Air Force. As a result of this
consolidation, we frequently enter into joint venture arrangements on various
programs with companies that are our competitors on other programs.
Through our performance under Government contracts awarded to us prior to
our participation in the Section 8(a) Program, we established our reputation for
expertise in the aerospace and information technology fields. As a result, we
continued to receive contract awards from NASA and the U.S. Air Force on many
important programs, such as the International Space Station at NASA's Johnson
Space Center after the automatic termination of our participation in the Section
8(a) program. During our participation in the Section 8(a) Program, our
technical competence and expertise in various sub-fields of the aerospace
industry was recognized by numerous awards and honors from both U.S. Government
agencies and private industry.
SECTION 8(a) PROGRAM; EFFECT OF GRADUATION FROM SECTION 8(a) PROGRAM ON OUR
BUSINESS AND ABILITY TO COMPETE.
Dynacs has been a small business and an SDB since 1985, and a participant
in the Section 8(a) Program certified as an SDB by the Small Business
Administration from October 1989 through October 1998. Companies may qualify as
small businesses if they have less than the number of employees assigned to the
particular standard industrial classification, or SIC code, applicable to a U.S.
Government contract. The SIC codes applicable to the contracts for which we
submit bids, as an SDB or small business, involve limits of 1,000 or 1,500
employees. Although we currently have fewer than 1,000 employees, if we pursue
our intended growth strategy, we anticipate that we may have more than 1,000
employees by 2001, and more than 1,500 by 2002. We have derived various benefits
in securing work as a prime contractor or subcontractor for U.S. Government
agencies from our status as a small business or SDB and our participation in the
Section 8(a) Program, because many U.S. Government contracts require that a
specified percentage of the work be performed by small businesses or SDBs.
Another benefit of SDB status results from the U.S. Government's prerogative of
adding up to 10.0% to the bid prices of non-SDB bidders in evaluating all bids
received for a project.
We believe that our demonstrated expertise in information technology has
been critical to our receiving work on a large number of U.S. Government
projects, including those projects for which bidding was restricted to SDBs
participating in the Section 8(a) Program. Although we ceased to participate in
this Program for new contracts in October 1998, upon automatic termination of
our allowed term of participation, we remain an SBA-certified small
disadvantaged business for purposes of performing contracts awarded under bids
we submitted prior to October 1998 and we remain subject to applicable U.S.
Government regulations as to U.S. Government contracts already awarded to us on
the basis of this participation. We do not believe that our continued
participation in the Section 8(a) Program is material to our continued success
in securing work on U.S. Government projects or in securing work in the private
sector. We do believe, however, that our ability to continue performing under
U.S. Government contracts currently in progress, in particular those awarded to
us as SDBs participating in the Section 8(a) Program, will be material to our
financial condition and results of operations through 2002. Our total backlog
under these contracts could exceed $146.0 million over the next three years, if
NASA and the U.S. Air Force exercise all existing options to extend or enlarge
the scope of the contracts. A loss of a significant portion of this backlog
would have a material adverse effect on our business.
Since the automatic termination of our participation in the nine-year
Section 8(a) Program, we have retained the status of an SBA-certified small
disadvantaged business and may maintain that
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<PAGE> 51
status until October 2001. At that time, we may apply to the SBA for continuing
certification. Our status as an SDB is based, in part, upon ownership of a
majority of our outstanding stock by a member of a "disadvantaged" group. We
have satisfied the equity ownership requirement for SDB status on the basis of
ownership of more than 50.0% of our outstanding common stock by Dr. Singh, our
President and Chief Executive Officer. However, Dr. Singh's stock ownership will
fall below 50.0% upon closing of this offering. When companies that participate
in the Section 8(a) Program no longer satisfy the stock ownership requirement,
Federal regulations mandate termination of contracts in progress that were
previously awarded on the basis of this participation, unless the SBA waives the
stock ownership requirement. We applied for and received a waiver from the SBA
of the stock ownership requirement in September 1999.
RESEARCH AND DEVELOPMENT
We distinguish between the research and development we conduct for the
benefit of our clients, which we refer to as "research and development," and
that which we conduct for our own benefit, which we refer to as "internal
development." We estimate that currently, over 95.0% of the revenue of our IAT
Division is generated under contracts providing research and development work
for our clients. All costs of this research and development are client-funded.
While many of the IAT Division's U.S. Government contracts require us to conduct
research and development on behalf of the U.S. Government, the contracts permit
us to patent or copyright intellectual property developed through our work
thereunder. We treat all work performed by us under these contracts as research
and development, and the associated costs as costs of revenues, even if we
exercise our rights to patent or copyright any of this intellectual property. As
a result, our internal development costs are minimal. However, when internal
development produces an identifiable asset of some value, we capitalize these
costs and amortize them ratably over a period of time based upon the estimated
useful life of the asset.
INTELLECTUAL PROPERTY
Our businesses are dependent on our innovative technologies, and the skills
and technical knowledge of our professional staff. We rely upon a combination of
patent, trade secret, copyright and trademark laws and mandatory employee
confidentiality agreements to protect our intellectual property. We also limit
access to our proprietary information. The steps we take to protect our
intellectual property, however, may not be adequate to deter misappropriation of
our proprietary information. We may be unable to detect unauthorized uses of, or
take appropriate steps to enforce, our intellectual property rights.
In general, if we wish to claim exclusive commercial rights in intellectual
property we develop under a U.S. Government contract, we must do so within two
years. If we do not make such claim of exclusivity, which involves undertaking
certain obligations of exploitation, we must share the technology on a
non-exclusive basis with other commercial users. In addition, under the Federal
Acquisition Regulations (FAR), the U.S. Government has certain proprietary
rights in intellectual property that we develop in providing services under
contracts or subcontracts with U.S. Government agencies. The U.S. Government
receives an irrevocable, royalty-free, non-exclusive and non-transferrable
license to such property, and may share intellectual property we develop with
third parties. Assignment and licensing of our rights are also subject to FAR.
These regulations also give the U.S. Government the right to disclose
information about this intellectual property to third parties, including our
competitors. Our rights in any data remain subject to U.S. Government export
control or national security laws or regulations.
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<PAGE> 52
Dynacs claims copyright, trademark and common law rights in each of its
computer software programs and related documentation. We own the copyright to
each of three software programs utilized in the aerospace industry and for other
applications: TREETOPS, DYCOM and Gensoft, all of which are proprietary tools
for the design and analysis of multi-body dynamics. Our proprietary colorization
software is comprised of:
- Dycolor, the basic colorization program;
- ShotManager, the production management system which allows us to divide
colorization work into separate frames and distribute them to different
employees to work on simultaneously; and
- FlipBook, our real time playback system.
Through our acquisition of Cerulean Colorization, L.L.C., we also own the
copyrights and patents to certain colorization software and processes.
EMPLOYEES
Frequently when we commence work under new IAT contracts, we need to hire
large numbers of employees in a relatively short period of time. When this
occurs, we fund the increased payroll costs using our revolving bank line of
credit. See Management's Discussion and Analysis of Financial Condition and
Results of Operations, "Liquidity and Capital Resources". We meet the personnel
requirements of our overseas media production facilities by hiring contract or
temporary employees. The use of contract employees lowers the administrative
costs of our overseas operations. From time to time, we also use contract
employees to meet personnel needs in the United States. References in this
prospectus to employees refer both to our employees and to personnel provided by
third parties, unless otherwise indicated.
At January 31, 2000, Dynacs had a total of 749 employees. The total number
of employees includes 648 in customer support and operations, 13 in development,
8 in sales and marketing, and 80 in administration. Of these, 712 employees are
located in the United States, 33 in India and 4 in Batam. The majority of our
employees in India and Batam are contract employees provided through independent
agencies that are responsible for all compensation, benefits and tax-related
aspects of their services. We pay a negotiated hourly or weekly rate per
employee to such third parties.
We believe that our future success is dependent on attracting and retaining
highly skilled technical, sales and marketing, and senior management personnel.
Competition for such personnel is intense, and there can be no assurance that we
will continue to attract and retain high-caliber employees.
We are not subject to any collective bargaining agreements and believe that
our relationship with our employees is good.
FACILITIES
Our principal executive offices are located in Palm Harbor, Florida. These
offices are located in a building which is owned by our subsidiary, Dynacs
Properties, Inc., of which we and a partner each own 50.0% with a lease
expiration date of December 31, 2003. We have a 60,000 square foot facility in
Cleveland, Ohio which services the Glenn Research Center with a lease expiration
date of
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<PAGE> 53
October 23, 2003. Our other domestic leased facilities which service the work of
our information and aerospace/satellite technologies divisions include the
following locations:
- Kennedy Space Center, Florida
- Albuquerque, New Mexico
- Cato, New York
- Houston, Texas
- Seattle, Washington
INTERNATIONAL: Our overseas software and digital media production
facilities, all of which are leased, consist of:
- A facility located in Bangalore, India which is leased by our subsidiary,
Dynacs Engineering Company (India) Pvt. Ltd., and used to provide
software development services. The term of the lease expires September
30, 2001;
- A facility of approximately 36,000 square feet located in Patna, India,
which is leased for a 90 year term by our subsidiary, Dynacs Digital
Studios, and contains a high-speed digital colorization and restoration
facility; and
- A facility of approximately 8,982 square feet located in Batam, Indonesia
which is leased by our Indonesia subsidiary, PT Dynacs Digital Studios,
and used to provide digital colorization and restoration services. The
term of the lease expires November 2, 2001 with an automatic renewal term
of three years unless either party gives six months prior notice of
intent to terminate.
We also lease a facility in Hollywood, California, for our Media and
Entertainment Division. This facility contains a digital film conversion
laboratory as well as office space.
GOVERNMENT REGULATION
UNITED STATES
We are subject to numerous laws and regulations applicable to those who
provide services under prime contracts and subcontracts to the U.S. Government.
These laws and regulations govern matters affecting payment and reimbursement of
contractors, U.S. Government audits, bidding procedures, and our rights in
intellectual property developed in the performance of services under these
contracts. See "Business -- Satellite and Aerospace Systems and Operations
Division -- Government Markets for Satellite/Aerospace Systems and Operations"
and "- Competition for U.S. Government Projects" and "Business -- Intellectual
Property."
INDIA AND INDONESIA
INDIA -- BANGALORE. Our software development facility in Bangalore, India
is owned by our subsidiary, Dynacs Engineering (India) Pvt. Ltd., which was
organized under the laws of India. India's Ministry of Industry has classified
this subsidiary as an "Export Oriented Unit," or EOU, because most of its sales
are export sales. Because of this EOU classification, this subsidiary is exempt
from all taxes on earned profits for a period of five consecutive years during
the first eight years of operations pursuant to Section 10B of the Indian Tax
Act of 1961, as amended (the "Indian Tax Act"). This tax exemption is available
to this subsidiary from April 1996 through March 2001.
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<PAGE> 54
After expiration of this exemption, this subsidiary is eligible for the
exemption from income tax on export profits available for software exports under
the Indian Tax Act.
INDIA -- PATNA. Our digital media production facility in Patna, India is
eligible for the same exemption from income tax on export profits under the
Indian Tax Act.
INDONESIA. Our subsidiary, PT Dynacs Digital Studios, operates a digital
colorization facility in the Batamindo Industrial Park on the island of Batam,
Indonesia. This subsidiary benefits from certain tax and other foreign
investment incentives, including a waiver of value added taxes.
LEGAL PROCEEDINGS
In November 1999, we were informed by NASA's Glenn Research Center of their
decision to award the MRDOC Contract to one of our competitors. We spent
approximately $740,000 in bid preparation costs for this contract. In December
1999, we filed a protest of such award with the General Accounting Office (GAO).
The GAO issued a stay of the award, pending resolution of the matter, which
typically takes 100 days from the date on which the protest is filed. If the GAO
renders its decision in favor of Dynacs, Dynacs may be reimbursed its bid
preparation costs, and possibly be awarded the Contract. No assurance can be
given, however, that the GAO will render a decision in Dynacs' favor, or that if
it does, it will award us the MRDOC Contract or reimbursement of all our bid
preparation costs.
In February 1998, Dynacs filed claims totaling $2,825,000 with the American
Arbitration Association in California against Juno Pix, Inc. for sums owed by
Juno in connection with colorization and other work completed by Dynacs for the
motion picture, "Pleasantville," prior to Juno's termination of our February
1997 agreement. Dynacs' claims included a demand for the termination fee payable
under the agreement, compensation for Juno's unauthorized use of Dynacs'
copyrighted technology following termination and injunctive relief for return of
its software. Dynacs' claims were made not only against Juno but also against
New Line Productions, Inc., as guarantor of Juno's performance, and New Line
Cinema, the parent of New Line Productions. Juno has filed counterclaims against
Dynacs for damages for breach of contract, repudiation of the agreement, false
and misleading advertisement and false assurances and representations. Juno has
also counterclaimed for treble damages where applicable under U.S. Government or
state law.
Oral argument in this arbitration took place in March 2000, with a decision
not expected before April 2000. No assurances can be given that a decision will
be rendered that is favorable to Dynacs. An award to Juno and the other
respondents could exceed Dynacs' available cash resources and thereby have a
material adverse effect on the Company and its prospects.
Our legal expenses for this matter through January 31, 2000 are
approximately $1.0 million, and we will continue to incur legal expenses in
connection with this matter until it is settled or a final determination is
rendered, which we do not expect until sometime in April 2000. Any final
disposition requiring us to pay our adversaries a substantial sum will also have
a material adverse effect on our financial condition and results of operations.
In July 1999, the Company settled an administrative proceeding brought
against it by a former employee. The total legal fees incurred by the Company in
connection with this administrative proceeding were approximately $186,600 in
1999, of which $85,000 was incurred by the end of the second quarter of 1999 and
the balance of $101,000 was incurred between July 1, 1999 and the date hereof.
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MANAGEMENT
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth the directors, persons elected to serve as
directors upon consummation of this offering, and executive officers of Dynacs,
their ages and their positions with Dynacs as of March 28, 2000.
<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- --- --------
<S> <C> <C>
Ramendra P. Singh....................... 55 Director, President and Chief Executive
Officer
Ravi Venugopal.......................... 37 Senior Vice President, Digital Media and
Entertainment, and Secretary
Harry W. Schubele III................... 41 Senior Vice President, Business and
Treasurer
Jayant Ramakrishnan..................... 40 Senior Vice President, Information and
Applied Technology
Javier E. Benavente..................... 40 Senior Vice President, Corporate
Business Development
Robert Rodriguez........................ 43 Chief Financial Officer
Peter Likins............................ 63 (1)
Michael R. Burns........................ 41 (1)
Michael G. Bolton....................... 56 (1)
Robert E. Skelton....................... 61 (1)
</TABLE>
- -------------------------
(1) Nominated to serve as a member of the board of directors upon consummation
of this offering.
All directors serve for one-year terms until the next annual meeting of
stockholders and until their successors are duly elected and qualified.
Each executive officer is elected by, and serves at the discretion of, the
board of directors. Each of Dynacs' executive officers and directors, other than
non-employee directors, devotes his full time to the affairs of Dynacs. There
are no family relationships among any of the directors or executive officers of
Dynacs. Michael R. Burns' election as director was made as a result of an
agreement with Dynacs in connection with the purchase of Cerulean Colorization,
L.L.C.
RAMENDRA P. SINGH, PH.D. Dr. Singh has been our President, Chief Executive
Officer and sole director since he co-founded the Company in 1985. Dr. Singh has
also served as sole director, President, Treasurer and Secretary of our
subsidiary, Dynacs Properties, Inc., since its formation in May 1997, and as a
Director of our subsidiary, Dynacs Technical Services, Inc., since its formation
in August 1998, and as sole director and President of our subsidiary Dynacs
Digital Services, Inc. since its formation in July 1998. Dr. Singh has served as
sole director and President of Cerulean FXs, Inc. since its formation in April
1999. Cerulean FX became our subsidiary in August 1999. Dr. Singh is an
Associate Fellow of the AIAA and the 1996 Division Director of the International
Society for Measurement and Control. Dr. Singh received his Ph.D. in Engineering
Mechanics from the University of Alabama, Huntsville in 1981, and his Masters of
Science in Mechanical Engineering from the University of Miami in 1969. Dr.
Singh is a recognized technical expert and is the author of over 50 published
journal papers and articles.
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RAVI VENUGOPAL. Mr. Venugopal has been Dynacs' Senior Vice President,
Digital Media and Entertainment, since January, 1999. Mr. Venugopal has also
served as a director and Secretary of our subsidiary, Dynacs Technical Services,
Inc., since its formation in August 1998. He has also served as Secretary of our
subsidiary Dynacs Digital Services, Inc., since its formation in July 1998 and
our subsidiary Cerulean FXs, Inc., since its formation in April 1999. From
January 1996 through December 1998, Mr. Venugopal served as our Chief Scientist,
from January 1994 through December 1995 as Director of Product Development, and
from 1991 through 1993 as Director of Business Development. Prior to that, Mr.
Venugopal was a senior engineer from 1989 through 1990 and an engineer from the
time he joined Dynacs in 1987 through 1988. Mr. Venugopal received his Masters
degree in Computer Engineering from the University of Florida in 1987.
HARRY W. SCHUBELE III. Mr. Schubele has served as our Treasurer since 1993
and as Senior Vice President, Business, since January 1999. From March 1996
through January 1999, Mr. Schubele served as Director of both Seattle Operations
and Western Region Operations. From 1991 through 1995, he served as Director of
Engineering. Prior to that, he was a member of our technical staff from 1987
through 1990. He has also served as Treasurer of our subsidiaries, Dynacs
Technical Services, Inc. since its formation in August 1998, Dynacs Digital
Services, Inc., since its formation in July 1998, and Cerulean FXs, Inc., since
its formation in April 1999. Mr. Schubele graduated with honors from Oklahoma
State University in 1980 with a BS in Mechanical and Aerospace Engineering. He
is a senior member of the AIAA and has numerous publications, papers and
conference presentations.
JAYANT RAMAKRISHNAN. Dr. Ramakrishnan has served as our Senior Vice
President, Engineering, since February 1999. Prior to that, he served as
Director of Houston Operations from July 1992 through February 1999. Dr.
Ramakrishnan received a Bachelors Degree in Mechanical Engineering from the
University of Madras in 1981, and Masters and Doctoral degrees in Mechanical
Engineering from the University of Missouri-Rolla in 1983 and 1987,
respectively.
JAVIER E. BENAVENTE. Mr. Benavente has been serving as Dynacs' Senior Vice
President, Corporate Business Development, since January 1999 and as President
and a director of Dynacs Technical Services, Inc. since September 1998. From May
1997 through December 1998, Mr. Benavente served on the senior staff to the
office of our President. From June 1995 through May 1997, he served as head of
our Digital Media and Entertainment Division and from February 1993 through June
1995 he served as our General Manager. Mr. Benavente served as our Manager,
European Operations, from January 1992 through February 1993. Prior to that he
served as a Dynacs' engineer from May 1988 through January 1992. Mr. Benavente
received his Bachelors Degree in Aeronautics and Astronautics in 1986, a Masters
Degree in Astronautical Engineering from Purdue University in 1988 and a Masters
in Engineering Management and Masters in Business Administration from the
Florida Institute of Technology in 1990 and 1991, respectively.
ROBERT RODRIGUEZ. Mr. Rodriguez has been our Chief Financial Officer since
joining Dynacs in January 1998. Prior to that, he was a partner in the
accounting firm of Doyle & Rodriguez, P.A. Mr. Rodriguez is a certified public
accountant and a member of the American Institute of Certified Public
Accountants. Mr. Rodriguez received his B.S./B.A. degree from the University of
Florida in 1978 and an M.B.A. degree in accounting from the University of Tampa
in 1981.
PETER LIKINS. Dr. Likins has been nominated to serve as a director of
Dynacs upon closing of this offering. He has been President of the University of
Arizona since 1997 and before that he was president of Lehigh University for
more than three years. He is a distinguished member of many national and
international advisory committees, including the White House Advisory Committee
on the Health of Universities. He has been a member of the Board of Directors of
COMSAT since 1987, Consolidated Edison, Parker-Hannifin, St. Luke's Hospital and
Safeguard Scientifics. He is an Advisory Council Member for Dynacs. Dr. Likins
is a Fellow of the AIAA and a member of the
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<PAGE> 57
National Academy of Engineering. Dr. Likins received his Bachelors Degree in
Civil Engineering, and a Ph.D. in Engineering Mechanics from Stanford
University, and a Masters in Civil Engineering from MIT.
MICHAEL R. BURNS. Mr. Burns has been nominated to serve as a director of
Dynacs upon closing of this offering. Mr. Burns' appointment to the Board of
Directors was made in connection with the acquisition of Cerulean Colorization,
L.L.C. by Dynacs. Mr. Burns has been serving as a managing director and the head
of the Los Angeles Investment Banking office of Prudential Securities
Incorporated, specializing in the media and entertainment field, since 1991.
Prior to joining Prudential Securities, Mr. Burns worked for Shearson Lehman
Brothers, Inc. (now Salomon Smith Barney) for nine years. Mr. Burns co-founded,
and currently serves as Co-Chairman of, the Hollywood Stock Exchange
(www.hsx.com), a web start-up, Chairman of Novica.com, a web-based e-commerce
site, and Chairman of Ignite Entertainment, a Los Angeles-based entertainment
content company. Mr. Burns was a managing member of Cerulean Colorization,
L.L.C., which we acquired in August 1999. Mr. Burns currently serves as a member
of the Board of Directors of The Harvey Entertainment Company, a public company
quoted on the Nasdaq National Market System (Symbol: HRVY) which owns and
exploits a library of celebrated characters and other intellectual property
assets.
MICHAEL G. BOLTON. Mr. Bolton has been nominated to serve as a director of
Dynacs upon the closing of this offering. Mr. Bolton has been a managing
director of PA Early Stage Partners and Senior Vice President of Safeguard
Scientifics, Inc. since September 1997. Prior to that, he served as the Vice
President of Lehigh University from February 1972 to August 1997. Mr. Bolton
holds a B.A. in economics and an M.B.A. from Lehigh University.
ROBERT E. SKELTON. Dr. Skelton has been nominated to serve as a director
of Dynacs upon closing of this offering. Dr. Skelton has served as president of
Dynamic Systems Research Inc., a firm owned by him that provides engineering
consulting services and seminars, since 1982. He has also been a Professor of
Engineering with the Department of Applied Mechanics and Engineering Sciences at
the University of California, San Diego, and the Director of its Structural
Systems and Control Lab from 1997 to the present. From 1975 to 1997, Dr. Skelton
was a Professor of Engineering at Purdue University. Prior to that, he served as
an engineering consultant to Sperry Rand Co. from 1965 through 1975. Dr. Skelton
is one of Dynacs' co-founders. Dr. Skelton served as an adviser to NASA for its
"Mission to Mars" project and for the Hubble Space Telescope.
BOARD COMMITTEES
Our board of directors has authorized creation of audit, compensation and
stock option committees upon effectiveness of the registration statement of
which this prospectus is a part.
The audit committee will have responsibility for reviewing the results and
scope of audits and other services provided by our auditors and oversight of our
system of internal accounting and financial controls. Nominees to serve on the
audit committee are Michael R. Burns, Michael G. Bolton and Robert E. Skelton.
The compensation committee will have authority to review and recommend to
the board of directors the cash compensation and other benefits to be provided
to our executive officers. This committee will also have responsibility for
general policies relating to compensation of our employees. Nominees to serve on
the compensation committee are Michael R. Burns, Michael G. Bolton and Peter
Likins.
The option committee will be responsible for approving or recommending
option grants and administering our 1999 Long-Term Incentive Plan. Nominees to
serve on the option committee are Michael R. Burns, Peter Likins and Ramendra P.
Singh.
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DIRECTOR COMPENSATION
Each non-employee director shall receive $8,000 per year plus $1,200 for
each board meeting attended and shall be reimbursed for his reasonable
out-of-pocket expenses incurred in attending meetings of the board of directors
or of any committee thereof. Upon the consummation of this offering Dynacs shall
grant Dr. Likins an option to purchase 29,947 shares of its common stock, to
vest over a two-year period, at an exercise price equal to the initial offering
price of the common stock per share. Upon the consummation of this offering
Dynacs shall grant Dr. Skelton options to purchase 14,973 shares of its common
stock to vest over a two-year period at an exercise price equal to the initial
offering price of the common stock per share. Upon the consummation of this
offering, the Company shall grant Mr. Bolton an option to purchase 3,743 shares
of its common stock, to vest over a one-year period at an exercise price equal
to the initial offering price of the common stock per share.
EXECUTIVE COMPENSATION
The following table sets forth the total compensation paid or accrued for
the 1997 and 1998 fiscal years and for the twelve month period ended December
31, 1999 to Dynacs' Chief Executive Officer and the other executive officers of
Dynacs whose annualized salary and bonus for 1999 exceeded a total of $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL
COMPENSATION
------------------ ALL OTHER
NAME POSITION YEAR SALARY BONUS COMPENSATION (1)
- ---- ---------------------- ---- -------- ------- ----------------
<S> <C> <C> <C> <C> <C>
Ramendra P. Singh.......... Director, President 1999 $299,000 -0- $1,416
and Chief Executive 1998 260,000 -0- 1,152
Officer 1997 228,800 $60,000 1,152
Ravi Venugopal............. Senior Vice President 1999 $120,000 -0- $ 228
and Secretary 1998 97,136 -0- 190
1997 91,000 $5,000 174
Harry W. Schubele III...... Senior Vice President 1999 $120,000 -0- $ 308
and Treasurer 1998 98,800 -0- 301
1997 93,600 $5,000 181
Jayant Ramakrishnan........ Senior Vice President 1999 $120,000 -0- $ 308
1998 104,000 -0- 208
1997 101,000 $5,000 198
Javier E. Benavente........ Senior Vice President 1999 $120,000 -0- $ 308
1998 97,500 -0- 191
1997 91,000 $7,500 174
</TABLE>
- -------------------------
(1) All other compensation consists of the imputed income associated with the
group term life insurance premium for policy values in excess of $50,000.
OPTION GRANTS IN LAST FISCAL YEAR; OPTION EXERCISES; FISCAL YEAR END OPTIONS
VALUES
No options to purchase shares of common stock were granted to the named
executive officers during the fiscal year ended September 30, 1999 and no
options were exercised.
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<PAGE> 59
The following table sets forth information regarding exercisable and
unexercisable stock options held as of September 30, 1999 by Dynacs' Chief
Executive Officer and all executive officers of Dynacs whose annualized salary
and bonus for the twelve-month period ending December 31, 1999 exceeded a total
of $100,000. There was no public trading market for our common stock as of
December 31, 1999. Accordingly, the value of Dynacs options has been calculated
by determining the difference between the exercise price per share and an
assumed initial public offering price of $10.00 per share.
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS AT FISCAL YEAR-END(#) OPTIONS AT FISCAL YEAR-END($)
NAME AND POSITION EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
- ----------------- ----------------------------- -----------------------------
<S> <C> <C>
Ramendra P. Singh, Director, 196,523/0 $1,961,300/$0
President and Chief Executive
Officer
</TABLE>
1999 LONG TERM INCENTIVE PLAN
GENERAL. In November 1999, our board of directors approved our 1999
Long-Term Incentive Plan. Pursuant to the plan, we may grant options intended to
qualify as "incentive stock options" under Section 422 of the Internal Revenue
Code of 1986, non-qualified stock options, stock appreciation rights, restricted
stock, deferred stock, stock purchase rights or other stock-based awards. See
"Shares Eligible for Future Sale -- Stock Options."
SHARES RESERVED FOR ISSUANCE. A total of 864,702 shares of common stock
have been reserved for issuance under the plan. Appropriate adjustments in the
aggregate number of shares subject to the plan will be made in the event of any
recapitalization, dividend of stock or property other than cash, stock split,
reclassification or other change in corporate structure affecting the common
stock. As of December 31, 1999, options to purchase 235,828 shares of common
stock have been reserved under the plan to holders of the Cerulean FX shares in
connection with the acquisition of Cerulean Colorization, L.L.C. with Michael R.
Burns having the right to receive options to purchase 157,219 shares of common
stock. Also, Mr. Burns has the right to receive options to purchase 39,305
shares of common stock under the Plan upon the Company obtaining contracts for
colorization services in an aggregate amount of $10.0 million no later than
August 12, 2002.
ELIGIBILITY. Our employees, officers and directors and those of our
subsidiaries and affiliates who are responsible for or contribute to the
management, growth and/or profitability of our businesses are eligible to be
granted awards under the plan. Only our employees and those of our subsidiaries,
however, are eligible to receive incentive stock options.
ADMINISTRATION. Our stock option committee is authorized to administer the
plan, including determining the individuals eligible for grants under the plan
and the terms of grants.
We may grant any of the following, or any combination of the following,
types of awards under the plan:
STOCK OPTIONS. The stock option committee determines the terms and
conditions of each incentive stock option and non-qualified stock option granted
under the plan, subject to the following conditions:
- the exercise price of a non-qualified stock option may be greater than
100.0% but not less than 85.0% of the fair market value of our common
stock on the date of grant, no less than 100.0%
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in the case of an incentive stock option and 110.0% in the case of
incentive stock options granted to an employee who, at the time of grant,
owns more than 10.0% of our voting capital stock.
- no option can be exercisable ten years after the date of grant and five
years in the case of an employee who, at the time of grant, owns more
than 10.0% of our voting capital stock.
- incentive stock options will be treated as non-qualified stock options to
the extent that the aggregate market value of the underlying common stock
for the first time during any calendar year exceeds $100,000.
STOCK APPRECIATION RIGHTS. A stock appreciation right is the right to
surrender to us all or a portion of a stock option in exchange for an amount of
cash or common stock at the discretion of the option committee equal to the
difference between:
- the fair market value, as of the date any part of a stock option is
surrendered, of the shares of common stock underlying any part of a stock
option, subject to pricing provisions, and
- the aggregate exercise price of any part of a stock option.
A stock appreciation right granted with respect to a given stock option
shall terminate and no longer be exercisable upon the termination or exercise of
the related stock option, subject to provisions specified by the stock option
committee.
RESTRICTED STOCK. A restricted stock award entitles the holder to receive
shares of common stock at the end of a restricted period determined by the stock
option committee. During the restricted period, the holder is not permitted to
sell, transfer, pledge or assign shares of restricted stock. The stock option
committee may provide for the lapse of such restrictions in installments and may
accelerate or waive such restriction in whole or in part, based on service,
performance and other criteria as the stock option committee may determine.
DEFERRED STOCK. A deferred stock award entitles the holder to receive
shares of common stock at the end of a specified deferral period. The stock
option committee shall determine, among other things, the duration of the period
during which, and the conditions under which, receipt of the common stock will
be deferred.
OTHER STOCK-BASED AWARDS. We may also make other awards of common stock
and other awards that are valued in whole or in part by reference to, or are
otherwise based on, common stock, including performance shares, convertible
preferred stock, convertible debentures, exchangeable securities and stock
awards or options valued by reference to book value or our performance.
EMPLOYMENT AGREEMENTS
We intend to enter into employment agreements effective upon the
consummation of this offering with each of Ramendra P. Singh, Ravi Venugopal,
Harry W. Schubele III, Jayant Ramakrishnan, Javier E. Benavente and Robert
Rodriguez pursuant to which such individuals will be employed as executive
officers of Dynacs.
PRINCIPAL STOCKHOLDERS
The following table sets forth the beneficial ownership of common stock by
each person (or group of affiliated persons) known by Dynacs to beneficially own
more than five percent of the outstanding shares of common stock, each director,
director-nominee and named executive officer of Dynacs, and all officers,
directors and director-nominees as a group without naming them as of March 24,
2000 and as adjusted to reflect the sale of 2,500,000 shares of common stock
offered
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hereby. Except as indicated in the notes to the table, the persons named in the
table have sole voting and investment power with respect to all shares of common
stock shown as beneficially owned by them.
<TABLE>
<CAPTION>
PERCENTAGE OF OUTSTANDING SHARES
BENEFICIALLY OWNED (1)
SHARES OF COMMON STOCK ---------------------------------------
NAME OF BENEFICIAL OWNER BENEFICIALLY OWNED(1) BEFORE OFFERING(2) AFTER OFFERING(3)
- ------------------------ ---------------------- ------------------ -----------------
<S> <C> <C> <C>
Ramendra P. Singh............... 3,439,158(4)(5) 55.0 % 39.3 %
Ravi Venugopal.................. 550,265 9.1 % 6.4 %
Harry W. Schubele III........... 196,523 3.2 % 2.3 %
Jayant Ramakrishnan............. 196,523 3.2 % 2.3 %
Javier E. Benavente............. 196,523(6) 3.2 % 2.3 %
Michael G. Bolton............... 0(7) -- --
Michael R. Burns................ 591,538(7)(8) 9.5 % 6.8 %
Peter Likins.................... 393,047(7) 6.5 % 4.6 %
Robert E. Skelton............... 491,308(7) 8.1 % 5.7 %
All officers and directors as a
group (9 persons)............. 6,054,885(9) 94.5 % 68.0 %
</TABLE>
- -------------------------
(1) Consists of shares issuable upon the exercise of options exercisable within
60 days from the date hereof.
(2) Based on 6,056,847 shares outstanding, including 701,588 shares of common
stock issuable upon the automatic conversion of certain parties' equity
interest in our subsidiary, Cerulean FXs, Inc., upon the consummation of
this offering.
(3) Based on 8,556,847 shares to be outstanding upon consummation of the
offering, assuming that the underwriters do not exercise their overallotment
option.
(4) Includes 196,523 shares of common stock issuable upon the exercise of
options exercisable within 60 days from the date hereof.
(5) Includes 291,977 shares of common stock owned by trusts which hold such
shares for the benefit of certain family members of Dr. Singh.
(6) Includes 29,478 shares of common stock owned by trusts which hold such
shares for the benefit of certain family members of Mr. Benavente.
(7) Messrs. Bolton, Burns, Likins and Skelton will become directors of the
Company upon the consummation of this offering.
(8) Includes 434,319 shares to be received by Mr. Burns upon the automatic
conversion of his shares of Dynac's subsidiary, Cerulean FXs, Inc., pursuant
to the terms of our acquisition of Cerulean. Colorization, L.L.C. in August
1999. See "Certain Transactions -- Acquisition of Cerulean." Also includes
157,219 shares of common stock issuable upon the exercise of options
exercisable within 60 days from the date hereof.
(9) Includes 434,319 shares to be received by Michael Burns upon the automatic
conversion of his shares of Dynacs' subsidiary, Cerulean FXs, Inc. and
353,742 shares of common stock issuable upon the exercise of option
exercisable within 60 days from the date hereof.
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CERTAIN TRANSACTIONS
ACQUISITION OF CERULEAN COLORIZATION, L.L.C.
In August 1999, we acquired all of the membership interests in Cerulean
Colorization, L.L.C. by issuing to its members 20.0%, or 4,000 shares, of the
outstanding common stock of Cerulean FXs, Inc., a wholly-owned subsidiary of
Dynacs. As the owner of 62.0% of the membership interests of Cerulean
Colorization, L.L.C., Michael Burns received 2,480 of the 4,000 shares. The
shares of common stock of Cerulean FXs held by the former members of Cerulean
Colorization, L.L.C. will be automatically converted into 701,588 shares of
Dynacs' common stock upon the consummation of this offering, unless the shares
are sooner converted upon the exercise by the holders of conversion rights under
certain circumstances. The number of shares of Dynacs' common stock which the
holders of Cerulean FXs shares are entitled to receive is subject to adjustments
for stock splits, stock dividends, recapitalizations. The holders of such shares
have certain pre-emptive rights which terminate upon this offering. The former
Cerulean interest holders are party to the registration rights agreement
discussed below. In connection with our acquisition of the Cerulean interests,
we have agreed to issue the following options upon the consummation of this
offering:
- options to purchase 157,219 shares of common stock to Mr. Michael Burns
under our 1999 Long-Term Incentive Plan;
- options to purchase 29,478 shares of common stock to Mr. Steven Strick
under our 1999 Long-Term Incentive Plan; and
- options to purchase 9,826 shares of common stock to Mr. Tracy Pearce
under our 1999 Long-Term Incentive Plan.
Also, Mr. Burns has the right to receive options to purchase 39,305 shares
of common stock under our 1999 Long-Term Incentive Plan upon our obtaining
contracts for colorization services no later than August 12, 2002 resulting in
fees of an aggregate amount of no less than $10.0 million.
As part of the acquisition of Cerulean, Dynacs agreed to lend Mr. Burns an
aggregate of $600,000. Of this amount, Dynacs loaned him $300,000 in August 1999
and is obligated to lend him $150,000 in January 2000 and another $150,000 in
January 2001. Mr. Burns has agreed to allow the Company to defer its loan
obligation to him for January 2000 until the consummation of this offering. The
note representing such indebtedness is non-recourse to Mr. Burns, bears interest
at the rate of 5.7% per annum and matures in August 2004. The loans are secured
by a pledge of all of Mr. Burns' stock in Cerulean FX (and in Dynacs' common
stock issuable upon the conversion of the Cerulean FXs stock into 701,588 shares
of common stock of Dynacs upon the effectiveness of this offering or at the
election of the holders thereof).
CERTAIN RELATIONSHIPS WITH RAMESH VENUGOPAL
Ramesh Venugopal, is a businessman who conducts business in various
countries in Southeast Asia, including Singapore and Indonesia, and is the
brother of Ravi Venugopal, a Senior Vice President and the Secretary of Dynacs.
Ramesh Venugopal has been party to several significant transactions with Dynacs
as follows:
- In January and February 1998, Ramesh Venugopal advanced to Dynacs loans
aggregating $1.0 million, bearing interest at the rate of 11.25% per
annum. This loan when made was originally unsecured. In May 1999, Dynacs
and Mr. Venugopal consolidated the notes into a loan agreement for a
principal amount of $1.0 million, bearing interest at the rate of 10.0%
and without a maturity date. Dynacs secured the payment of the loan by a
pledge of Dynacs' share of proceeds from the syndication of the colorized
version of the TV series "I Dream of
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Jeannie." As of March 15, 2000, the outstanding balance under this loan
agreement was $585,000. Dynacs intends to repay such amount from the net
proceeds of this offering.
- In October 1998, Ramesh Venugopal advised Dynacs in connection with the
founding of its Batam, Indonesia facility. During the nine month period
ended September 30, 1999, Dynacs paid Mr. Venugopal $1,206,000 in
consideration for costs and services which he advanced on behalf of
Dynacs in connection with the startup of this facility.
- In August 1999, Dynacs issued 88,436 shares of common stock to Mr.
Venugopal in payment for his services in supervising the construction of
the Batam facility and for managing it through December 31, 1999.
RELATED PARTY LOANS TO DYNACS
Dynacs has borrowed funds from certain officers, directors and principal
stockholders of the company, as follows:
- In September 1997, Ravi Venugopal, a Senior Vice President and
stockholder of Dynacs, made a loan to Dynacs of $150,000 pursuant to a
note bearing interest at a rate of 10.5% per annum, which Dynacs repaid
in November 1998.
- On October 6, 1997, Venugopal Srinivasan and Ranjini Srinivasan, the
brother and sister-in-law of Ravi Venugopal, a Senior Vice President and
the Secretary of Dynacs, loaned Dynacs $200,000 pursuant to a note
bearing interest at the rate of 10.5% per annum for a period of 36
months. The outstanding balance as of February 29, 2000 was $58,000.
Dynacs intends to repay such amount from the net proceeds of this
offering.
- On February 15, 2000, Mr. Srinivasan, loaned Dynacs an aggregate of
$110,000 pursuant to a note, bearing interest at the rate of 12.0% per
annum with an extended maturity of August 15, 2000. Dynacs intends to
repay such amount from the net proceeds of this offering.
- On March 30, 1999, Dr. Ramendra Singh, our President, CEO and a principal
stockholder, loaned Dynacs $160,000 pursuant to a note bearing interest
at the rate of 12.0% per annum with an extended maturity of September 30,
2000. Dynacs intends to repay such amount from the net proceeds of this
offering.
- On December 10, 1999, Dr. Peter Likins, a stockholder of Dynacs who has
agreed to serve as a director upon effectiveness of this offering, loaned
Dynacs $400,000 pursuant to a note which bears interest at the rate of
12.0% per annum and matures on April 1, 2000.
- On December 10, 1999, Robert Skelton, a stockholder of Dynacs who has
agreed to serve as a director upon the consummation of this offering,
loaned Dynacs $200,000 pursuant to a note which bears interest at the
rate of 12.0% per annum and matures on April 1, 2000.
- In February 23, 2000, Ravi Venugopal loaned Dynacs $248,000 pursuant to a
note bearing interest at the rate of 12.0% per annum with an extended
maturity of August 23, 2000. Dynacs intends to repay such amount from the
net proceeds of this offering.
- In February 23, 2000, Anil Singh, Dr. Singh's nephew, loaned Dynacs
$89,000 pursuant to a note bearing interest at 12.0% per annum with an
extended maturity of August 23, 2000. Dynacs intends to repay such amount
from the net proceeds of this offering.
Dynacs has borrowed an aggregate of approximately $3,765,600 during the
period of January 1997 through December 1999 from certain officers, directors,
principal stockholders and/or members of their immediate family. See "Principal
Stockholders -- Certain Relationships with Ramesh Venugopal."
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SALE OF SHARES OF COMMON STOCK TO RAVI VENUGOPAL
On January 25, 1999, Dynacs issued 353,742 shares of common stock to Ravi
Venugopal for the aggregate consideration of $1,127,700. Of this amount, Mr.
Venugopal paid $2,000 in cash and the balance of $1,125,700 by issuing to Dynacs
a promissory note of Mr. Venugopal which is also secured by a pledge of these
shares. This note bears interest at the prime rate per annum and matures on
January 1, 2001.
RELATIONSHIP WITH LENTZ & FAIR
The office building in Palm Harbor, Florida which houses our corporate
headquarters, is owned by Dynacs Properties Inc., a company owned 50.0% by
Dynacs and 50.0% by Gibraltar Holdings Inc., a corporation owned by James Lentz,
a partner in the law firm, Lentz & Fair. Dynacs Properties, Inc. entered into
lease agreement with Lentz & Fair for the rental of office space. The lease
arrangement between Dynacs Properties Inc. and Lentz & Fair was determined on an
arms-length basis. Lentz & Fair has represented Dynacs in numerous legal
matters, including the litigation described elsewhere in this prospectus
concerning the movie, "Pleasantville." Lentz & Fair has been paid legal fees in
an aggregate amount of $623,534 in 1999, $45,623 in 1998, $69,259 in 1997 and
$156,804 in 1996. From January through February 2000, Dynacs has paid Lentz &
Fair legal fees totaling approximately $101,000.
REGISTRATION RIGHTS AGREEMENT
All stockholders of Dynacs at August 31, 1999, together with the former
holders of Cerulean Colorization, L.L.C. holding shares of common stock of
Cerulean FXs, Inc., are party to a registration rights agreement which provides
that if Dynacs proposes to register any of its securities under the Securities
Act, either for its own account or the account of any of its security holders,
the parties to this agreement are entitled to include their registrable shares
in such registration. However, in the event of a registration pursuant to an
underwritten public offering of common stock, the underwriters have the right to
limit the number of shares included in such registration. These rights terminate
for a holder at such time as the holder is authorized to sell all of its shares
under Rule 144(k) under the Securities Act.
OTHER MATTERS
Dynacs believes that the foregoing transactions were in its best interest
and were approved by its board of directors. As a matter of policy, all future
transactions between Dynacs and any of its officers, directors or principal
stockholders will be approved by a majority of the independent and disinterested
members of the board of directors.
DESCRIPTION OF SECURITIES
Our authorized capital stock consists of 20,000,000 shares of stock, of
which 15,000,000 shares are common stock, par value $.01 per share, and
5,000,000 shares are preferred stock, par value $.01 per share.
The following summary description of Dynacs' capital stock, as of the
closing of this offering, is not intended to be complete and is qualified by
reference to the provisions of applicable law and to Dynacs' amended and
restated certificate of incorporation and amended and restated by-laws filed as
exhibits to the registration statement of which this prospectus is a part.
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<PAGE> 65
COMMON STOCK
Immediately prior to the consummation of this offering, there were
5,355,259 shares of common stock outstanding and held of record by 29
stockholders. Based upon the number of shares outstanding as of the consummation
of this offering and giving effect to the conversion of shares held by the
former members of Cerulean Colorization, L.L.C. into 701,588 shares of common
stock and the issuance of the shares of common stock offered by Dynacs hereby,
there will be 8,556,847 shares of common stock outstanding upon the closing of
this offering, assuming no exercise of the underwriters' over-allotment option.
In addition, as of February 29, 2000, there were stock options reserved for the
purchase an aggregate of 857,593 shares of common stock, Bridge Notes
convertible into an aggregate of 483,334 shares of common stock and warrants
(including placement agent warrants) to purchase 536,834 shares of common stock.
Holders of common stock are entitled to one vote per share for each share
held of record on all matters submitted to a vote of stockholders and do not
have cumulative voting rights. Directors are elected by a plurality of the votes
of the shares present in person or by proxy at the meeting. The holders of
common stock are entitled to receive ratably such lawful dividends as may be
declared by the board of directors. However, such dividends are subject to
preferences that may be applicable to the holders of any outstanding shares of
preferred stock. In the event of a liquidation, dissolution or winding up of the
affairs of Dynacs, whether voluntarily or involuntarily, the holders of common
stock will be entitled to receive pro rata all of the remaining assets of Dynacs
available for distribution to its stockholders. Any such pro rata distribution
would be subject to the rights of the holders of any outstanding shares of
preferred stock. The common stock has no preemptive, redemption, conversion or
subscription rights. All outstanding shares of common stock are fully paid and
non-assessable. The shares of common stock to be issued by Dynacs in this
offering will be fully paid and non-assessable. The rights, powers, preferences
and privileges of holders of common stock are subject to, and may be adversely
affected by, the rights of the holders of shares of any series of preferred
stock that Dynacs may designate and issue in the future. Upon the closing of
this offering, there will be no shares of preferred stock outstanding.
PREFERRED STOCK
Immediately prior to the consummation of this offering, there were no
shares of preferred stock outstanding. The board of directors is authorized,
subject to any limitations prescribed by Delaware law, without further
stockholder approval, to issue from time to time up to an aggregate of 5,000,000
shares of preferred stock, in one or more series. The board of directors is also
authorized, subject to the limitations prescribed by Delaware law, to establish
the number of shares to be included in each series and to fix the voting powers,
preferences, qualifications and special or relative rights or privileges of each
series. The board of directors is authorized to issue preferred stock with
voting, conversion and other rights and preferences that could adversely affect
the voting power or other rights of the holders of common stock.
Dynacs has no current plans to issue any preferred stock. However, the
issuance of preferred stock or of rights to purchase preferred stock could have
the effect of making it more difficult for a third party to acquire, or of
discouraging a third party from attempting to acquire, a majority of the
outstanding common stock of Dynacs.
BRIDGE FINANCINGS
BRIDGE NOTES
In order to finance our working capital deficits during the period November
1999 through March 2000, we conducted two offerings of Bridge Notes for an
aggregate principal amount of $2.9 million. $1.0 million of the Bridge Notes
were sold in "Bridge I" from November 1999 to
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January 2000 and the remaining $1.9 million were sold in "Bridge II" from
February to March 2000. The Bridge Notes are unsecured and subordinate to our
currently existing equipment financings, $4,000,000 line of credit with the
First National Bank of Florida and certain indebtedness aggregating $585,000,
and are guaranteed by Dr. Ramendra P. Singh, our Chief Executive Officer,
President, director and a principal stockholder. The Bridge Notes bear interest
at the initial rate of 8.0% per annum from the date of issuance until and
including the 120th day from the date of issuance, and thereafter at the rate of
15.0% per annum and mature on the one year anniversary of the date of grant, if
not converted prior to such date. Pursuant to the terms of the Bridge Notes,
upon a "Liquidity Event," defined as the initial public offering of Dynacs'
common stock and the sale of all or substantially all of the assets of Dynacs, a
holder of a Bridge Note may convert such note into a number of shares of Dynacs'
common stock equal to the outstanding principal and accrued and unpaid interest
of the note divided by the conversion price. The conversion price of each Bridge
Note is 60.0% of the initial public offering price of the common stock. Also, in
the event we conduct a private offering of equity or equity-linked securities at
any time during which the Bridge Notes are outstanding, resulting in aggregate
proceeds of not less $2.0 million, we are obligated to either repay the
outstanding principal amount and accrued and unpaid interest on the Bridge Notes
or convert any Bridge Note, at the option of the holder, into such securities
issued in such private financing. The holders of the Bridge Notes have unlimited
piggyback registration rights with respect to the shares of common stock
issuable upon the exercise of the warrants and issuable upon conversion of such
notes and one demand registration right.
WARRANTS
Each initial holder of the Bridge Notes received five-year warrants to
purchase 16,845 shares of our common stock for each $100,000 denomination of
Bridge Notes purchased. We issued warrants to purchase an aggregate amount of
168,450 shares of common stock in Bridge I and 320,050 shares of common stock in
Bridge II. The warrants are exercisable at a price equal to 70.0% of the initial
public offering price of the common stock. The holders of the warrants have
unlimited piggyback registration rights with respect to the shares of common
stock they may purchase and one demand registration right.
PLACEMENT AGENT WARRANTS
We issued warrants to purchase an aggregate of 48,334 shares of common
stock to H.C. Wainwright & Co., Inc., a representative of the underwriters of
this offering, in consideration for services rendered as placement agent of the
Bridge Financings. Such warrants were issued on similar terms of the warrants
issued to the Bridge Note holders.
REGISTRATION RIGHTS AGREEMENT
All of the stockholders of Dynacs at March 28, 2000, together with the
former holders of Cerulean Colorization, L.L.C. holding shares of common stock
of Cerulean FXs, Inc., are party to a registration rights agreement dated August
13, 1999. This agreement is described in the section of this prospectus entitled
"Certain Transactions -- Registration Rights Agreement."
ANTI-TAKEOVER EFFECTS OF CERTAIN PROVISIONS OF DELAWARE LAW AND OUR CERTIFICATE
OF INCORPORATION AND BYLAWS
DELAWARE LAW. We are subject to Section 203 of the Delaware General
Corporation Law regulating corporate takeovers. This section prevents Delaware
corporations from engaging under certain circumstances, in a "business
combination," which includes a merger or sale of more than 10.0% of the
corporation's assets, with any "interested stockholder," or a stockholder who
owns 15.0% or more of the corporation's outstanding voting stock, as well as
affiliates and associates of any such
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persons, for three years following the date of such stockholder became an
"interested stockholder" unless:
- the transaction in which such stockholder became an "interested
stockholder" is approved by the board of directors prior to the date the
"interested stockholder" attained such status;
- upon consummation of the transaction that resulted in the stockholder's
becoming an interested stockholder, the interested stockholder owned at
least 85.0% of the voting stock of the corporation outstanding at the
time the transaction commenced, excluding those shares owned by persons
who are directors and also officers; or
- on or after the date of business combination is approved by the board of
directors and authorized at an annual or special meeting of stockholders
by the affirmative vote of at least two-thirds of the outstanding voting
stock that is not owned by the interested stockholder.
OUR CERTIFICATE OF INCORPORATION AND BYLAWS. Provisions of our certificate
of incorporation and bylaws, which will be in effect upon the closing of this
offering may have the effect of deterring hostile takeovers or delaying changes
in control or management of Dynacs. For example, the certificate of
incorporation provides that stockholders are not entitled to cumulate their
votes for the election of directors. The certificate of incorporation also
authorizes undesignated preferred stock which makes it possible for the board of
directors to issue preferred stock with voting or other rights or preferences
that could impede the success of any attempt to change control of Dynacs. Our
by-laws also authorize the board of directors to fill vacancies on the board and
to increase the number of board members. In addition, our by-laws limit the
ability of stockholders to raise matters or nominate persons to serve as members
of the Board of Directors at a meeting of stockholders without giving advance
notice, except with the unanimous consent of all stockholders entitled to vote
at the meeting. These provisions may preclude stockholders from bringing matters
before an annual meeting of stockholders or from making nominations for
directors.
LIMITATION OF LIABILITY AND INDEMNIFICATION MATTERS
To the extent permitted under Delaware law, the certificate of
incorporation limits the personal liability of our officers and directors to us
or our stockholders for monetary damages for any breach of fiduciary duty as our
officers and directors except for liability for:
- any breach of the director's duty of loyalty to the corporation or its
stockholders;
- acts or omissions not in good faith or that involve intentional
misconduct or a knowing violation of law;
- payments of dividends or approval of stock repurchases or redemptions
that are prohibited by the Delaware General Corporation Law; or
- any transaction from which the director derived an improper personal
benefit.
Under Delaware law, our directors have a fiduciary duty to us that is not
eliminated by this provision of the certificate. This provision also does not
affect the directors' responsibilities under any other laws, including federal
securities laws.
Our certificate of incorporation provides full indemnification of officers
and directors by Dynacs to the fullest extent permitted by law.
STOCK TRANSFER AGENT
The transfer agent and registrar for the common stock is Continental Stock
Transfers & Trust Company, New York, New York.
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SHARES ELIGIBLE FOR FUTURE SALE
Prior to this offering, there has not been any public market for our common
stock. We cannot predict the effect, if any, that market sales of shares of
common stock or the availability of shares of common stock for sale will have on
the prevailing market price of our common stock. Nevertheless, sales of
substantial amounts of our common stock in the public market at any one period
in time could adversely affect prevailing market prices of our common stock.
Furthermore, since some shares of common stock will not be available for sale
shortly after this offering because of the contractual and legal restrictions on
resale described below, sales of substantial amounts of common stock in the
public market at any one period in time after these restrictions lapse could
adversely affect the prevailing market price and our ability to raise equity
capital in the future on favorable terms, if at all.
Upon completion of this offering, we will have outstanding an aggregate of
8,556,847 shares of our common stock, assuming the underwriters do not exercise
their over-allotment option, outstanding options and warrants are not exercised
and the Bridge Notes are not converted. Of these shares, the 2,500,000 shares of
common stock sold in this offering will be freely tradable without restriction
or further registration under the Securities Act and 6,056,847 shares will be
deemed to be "restricted securities" as that term is defined in Rule 144 under
the Securities Act. Of these shares, 5,355,259 shares could be sold pursuant to
Rule 144 commencing 90 days after the effective date of this offering, subject
to the transfer restrictions of the lock-up agreements. The remaining 701,588
shares could be sold pursuant to Rule 144 commencing one year after the
effective date of this offering.
LOCK-UP AGREEMENTS
Stockholders holding an aggregate of 6,056,847 shares of common stock,
including all of our officers and directors who hold shares of common stock or
options to purchase shares of common stock, and the holders of the Bridge Notes
and warrants issued in connection with Bridge I and Bridge II, have signed
lock-up agreements with the underwriters under which they agreed not to transfer
or dispose of, directly or indirectly, any shares of common stock or any
securities convertible into or exercisable or exchangeable for shares of common
stock, for a period of 180 days after the date of this prospectus. Transfers or
dispositions can be made sooner only under the following circumstances:
- with the prior written consent of H.C. Wainwright & Co., Inc.;
- in the case of transfers to affiliates;
- as a bona fide gift; or
- to a trust of which the transferee, or his/her spouse, parents or
dependents are the sole beneficiaries.
Upon expiration of the lock-up period, 180 days after the date of this
prospectus, 6,056,847 shares will be available for resale to the public to the
extent that Rule 144 is available.
RULE 144
In general, pursuant to Rule 144 under the Securities Act as currently in
effect, beginning 90 days after the date of this prospectus, provided that
Dynacs is current in its reporting requirements, a person who has beneficially
owned shares of our common stock for at least one year
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would be entitled to sell within any three-month period a number of shares that
does not exceed the greater of:
- 1.0% of the number of shares of common stock then outstanding, which will
equal approximately 85,568 shares immediately after this offering;
assuming the underwriters do not exercise their over-allotment option; or
- the average weekly trading volume of the common stock on Nasdaq during
the four calendar weeks preceding the filing of a notice on Form 144 with
respect to such sale.
Sales under Rule 144 are also subject to manner of sale provisions and
notice requirements and to the availability of current public information about
us.
RULE 144(k)
Pursuant to Rule 144(k) under the Securities Act, a person who has not been
one of our affiliates at any time during the three-months preceding a sale, and
who has beneficially owned the shares proposed to be sold for at least two
years, including the holding period of any prior owner who was a non-affiliate,
is entitled to sell such shares without restrictions.
RULE 701
In general, under Rule 701 of the Securities Act as currently in effect,
any of our employees, consultants or advisors who purchases shares from us in
connection with a compensatory stock plan or other written agreement is eligible
to resell such shares 90 days after the effective date of this offering in
reliance on Rule 144, but without compliance with various restrictions,
including the one-year holding period, contained in Rule 144. At the request of
the underwriters, shareholders who would otherwise be able to avail themselves
of this provision to resell their shares have agreed to enter into the lock-up
agreements described above for a period of 180 days from the consummation of
this offering.
REGISTRATION RIGHTS AGREEMENT
All of the stockholders of Dynacs prior to this initial public offering,
together with the former holders of Cerulean Colorization, L.L.C. holding shares
of common stock of Cerulean FXs, Inc., are party to a registration rights
agreement. This agreement provides that if Dynacs proposes to register any of
its securities under the Securities Act, either for its own account or for the
account of another security holder, the parties to this agreement are entitled
to receive notice of the registration and to register their shares as part of
the registration. The agreement also provides, however, that the underwriters of
a public offering of Dynacs' common stock have the right to limit the number of
shares registered by these stockholders. The registration rights of these
stockholders terminate as to each stockholder at the time when Rule 144(k)
promulgated under the Securities Act would permit the stockholder to sell all of
its shares.
STOCK OPTIONS
We intend to file a registration statement under the Securities Act
covering 864,702 shares of common stock reserved for issuance under our 1999
Long-Term Incentive Plan. We expect to file this registration statement 90 days
after the effective date of this offering, and we anticipate that it will become
effective upon filing. Accordingly, shares registered under this registration
statement should be available for sale in the open market 90 days after the
effective date of this offering, subject to vesting provisions of the plan, Rule
144 volume limitations that apply to our affiliates, and applicable lock-up
agreements.
65
<PAGE> 70
Options to purchase an aggregate of 196,523 shares of common stock have
been reserved under the plan to holders of the Cerulean FXs shares in connection
with the acquisition of Cerulean Colorization, L.L.C. Options to purchase
157,219 of the 196,523 shares of common stock were reserved for Mr. Burns under
the plan. Also, Mr. Burns has the right to receive options to purchase 39,305
shares of common stock under the plan upon the Company obtaining contracts for
colorization services in an aggregate amount of $10.0 million no later than
August 12, 2002. See "Management -- Executive Compensation," "Option Grants in
Last Fiscal Year; and "Option Exercises; Fiscal Year End Option Values" and
"1999 Long Term Incentive Plan."
66
<PAGE> 71
UNDERWRITING
Subject to the terms and conditions contained in the underwriting
agreement, Dynacs has agreed to sell to each of the underwriters named below,
and each of the underwriters, for which H.C. Wainwright & Co., Inc. and Roth
Capital Partners, Inc. are acting as representatives, has severally, and not
jointly, agreed to purchase the number of shares offered in this offering set
forth opposite their respective names below.
<TABLE>
<CAPTION>
NAME NUMBER OF SHARES
- ---- ----------------
<S> <C>
H.C. Wainwright & Co., Inc. ................................
Roth Capital Partners, Inc. ................................
---------
Total............................................. 2,500,000
=========
</TABLE>
A copy of the underwriting agreement has been filed as an exhibit to this
registration statement. The underwriters shall be obligated to purchase all of
the shares (other than those covered by the underwriters' over-allotment option
described below), if any are purchased.
The representatives have advised us that the underwriters propose to offer
the shares to the public at the initial public offering price on the cover page
of this prospectus and that they may allow some dealers who are members of the
NASD, and some foreign dealers, concessions not in excess of $ per share, of
which amount a sum not in excess of $ per share may in turn be re-allowed by
such dealers to other dealers who are members of the NASD and to some foreign
dealers. After the commencement of this offering, the offering price, the
concession to selected dealers, and the re-allowance to other dealers may be
changed by the representatives. The representatives have informed us that they
do not expect discretionary sales by the underwriters to exceed five percent of
the shares offered by this prospectus.
We have agreed to pay to the representatives an expense allowance on a
non-accountable basis, equal to the greater of $250,000 or 1.0% of the gross
proceeds derived from the sale of 2,500,000 shares offered in this offering, or
2,875,000 shares if the underwriters' over-allotment option is exercised in
full. We paid an advance on this allowance in the amount of $25,000.
We have also granted to the underwriters an option, exercisable during the
45-day period commencing on the date of this prospectus, to purchase at the
public offering price per share, less the underwriting discount and fees and the
non-accountable expense allowance, up to an aggregate of 375,000 shares of
common stock to cover over-allotments, if any. To the extent this option is
exercised, the underwriters will become obligated, subject to some conditions,
to purchase additional shares of common stock in approximately the same
proportion as set forth in the above table.
The following table provides information regarding the amount of the
discount of the common stock offered hereby to the underwriters:
<TABLE>
<CAPTION>
TOTAL WITHOUT TOTAL WITH
EXERCISE OF EXERCISE OF
OVER-ALLOTMENT OVER-ALLOTMENT
DISCOUNT PER SHARE OPTION OPTION
------------------ -------------- -------------------
<S> <C> <C> <C>
Dynacs....................... $ $ $
</TABLE>
We have also agreed to sell to the representatives for nominal
consideration, the representatives' warrants to purchase up to 250,000 shares of
common stock. The representatives' warrants are exercisable for a period of four
years commencing one year after the date of this prospectus at an exercise price
per share equal to $12.00 (120.0% of the public offering price). The
representatives' warrants may not be sold, transferred, assigned, pledged, or
hypothecated for a period of 12 months
67
<PAGE> 72
from the date of this prospectus, except to officers or partners of the
representatives or members of the selling group. Dynacs has granted to the
representatives one demand registration right at Dynacs expense and one demand
registration right at the holders' expense for a period of five years from the
effective date of this offering and piggyback registration rights for a period
of six years from the effective date of this offering with respect to
registration under the Securities Act of the securities directly or indirectly
issuable upon exercise of the representatives' warrants. The representatives'
warrants contain anti-dilution provisions providing for adjustments of the
exercise price and number of shares issuable on exercise of the representatives'
warrants, upon the occurrence of some events, including stock dividends, stock
splits, and recapitalizations. The holders of the representatives' warrants have
no voting, dividend, or other rights as a stockholder with respect to shares of
common stock underlying the representatives' warrants, unless the
representatives' warrants shall have been exercised.
In connection with this offering, we have granted H.C. Wainwright & Co.,
Inc. the right, for the five-year period commencing on the closing date of this
offering, to appoint an observer to attend all meetings of our board of
directors. This designee has the right to notice of all meetings of the board of
directors and to receive reimbursement for all out-of-pocket expenses incurred
to attend these meetings. In addition, the designee will be entitled to
indemnification to the same extent as our directors.
We, and each of our officers, directors, and stockholders, have entered
into lock-up agreements under which we and they have agreed not to offer,
assign, issue, sell, hypothecate, or otherwise dispose of any shares of common
stock, securities of Dynacs convertible into, or exercisable or exchangeable
for, shares of common stock, or shares of common stock received upon conversion,
exercise, or exchange of these securities, to the public without the prior
written consent of H.C. Wainwright & Co., Inc. for a period of at least 180 days
after the date of this prospectus. H.C. Wainwright & Co., Inc. may, at any time
and without notice, waive the terms of those lock-up agreements.
Before this offering, there has been no public market for the common stock
of Dynacs. The initial public offering price, negotiated between Dynacs and the
representatives, is based upon Dynacs' financial and operating history and
condition, its prospects, the prospects for the industry we are in and
prevailing market conditions.
H.C. Wainwright & Co., Inc. received an aggregate of $240,000 in cash
commissions and warrants to purchase 48,334 shares of common stock of Dynacs as
placement agent in connection with the Bridge Financings. H.C. Wainwright & Co.,
Inc. was also reimbursed $9,000 for expenses related to the Bridge Financings.
Rules of the Securities and Exchange Commission may limit the ability of
the underwriters to bid for or purchase shares before the distribution of the
shares is completed. However, the underwriters may engage in the following
activities in accordance with the rules:
- STABILIZING TRANSACTIONS. The underwriters may make bids or purchases
for the purpose of pegging, fixing or maintaining the price of the
shares, so long as stabilizing bids do not exceed a specified maximum.
- OVER-ALLOTMENTS AND SYNDICATE COVERAGE TRANSACTIONS. The underwriters
may create a short position in the shares by selling more shares than are
set forth on the cover page of this prospectus. If a short position is
created in connection with the offering, the representatives may engage
in syndicate covering transactions by purchasing shares in the open
market. The representatives may also elect to reduce any short position
by exercising all or part of the over-allotment option.
68
<PAGE> 73
- PENALTY BIDS. If the representatives purchase shares in the open market
in a stabilizing transaction or syndicate coverage transaction, they may
reclaim a selling concession from the underwriters and selling group
members who sold those shares as part of this offering.
Stabilization and syndicate covering transactions may cause the price of
the shares to be higher than it would be in the absence of such transactions.
The imposition of a penalty bid might also have an effect on the price of the
shares if it discourages resales of the shares.
Neither we nor the underwriters makes any representation or prediction as
to the effect that the transactions described above may have on the price of the
shares. These transactions may occur on the Nasdaq National Market, in the
over-the-counter market or on any trading market. If such transactions are
commenced, they may be discontinued without notice at any time.
We have agreed to indemnify the underwriters against some liabilities,
including civil liabilities under the Securities Act, or to contribute to
payments the underwriters may be required to make in this respect.
69
<PAGE> 74
LEGAL MATTERS
The validity of the common stock offered hereby will be passed upon for
Dynacs by Frankfurt, Garbus, Klein & Selz, P.C., New York, NY. Orrick,
Herrington & Sutcliffe LLP, New York, NY will pass upon various legal matters
for the underwriters.
EXPERTS
On August 27, 1999, Dynacs dismissed their prior independent accountants,
Hoyman, Dobson & Company, P.A., upon completion of the audit of the financial
statements as of and for the year ended December 31, 1997. Such dismissal of
Hoyman by the Company was not based on a disagreement nor did any of Hoyman's
reports on the financial statements as of and for the year ended December 31,
1997 contain any adverse opinion or disclaimer of opinion nor were they
qualified or modified as to uncertainty, audit scope or accounting principles.
On August 27, 1999, Dynacs engaged Arthur Andersen LLP as their new independent
certified public accountants.
The consolidated financial statements included in this registration
statement to the extent and for the periods indicated in their reports, have
been audited by Arthur Andersen LLP, independent certified public accountants,
and are included herein in reliance upon the authority of said firm as experts
in giving said reports.
The consolidated financial statements included in this registration
statement to the extent and for the periods indicated in their reports, have
been audited by Hoyman Dobson and Co., independent certified public accountants,
and are included herein in reliance upon the authority of said firm as experts
in giving said reports.
AVAILABLE INFORMATION
Dynacs has filed with the Securities and Exchange Commission, a
registration statement on Form S-1 (including the exhibits and schedules to the
registration statement) under the Securities Act with respect to the shares to
be sold in this offering. This prospectus does not contain all the information
set forth in the registration statement. For further information with respect to
Dynacs and the shares to be sold in this offering, reference is made to the
registration statement. Statements contained in this prospectus as to the
contents of any contract, agreement or other document referred to, are not
necessarily complete, and in each instance reference is made to the copy of each
contract, agreement or other document filed as an exhibit to the registration
statement.
You may read and copy all or any portion of the registration statement or
any reports, statements or other information Dynacs files at the Commission's
public reference room at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549 and at the regional offices of the Commission located at
Seven World Trade Center, 13th Floor, New York, New York 10048 and 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661. You can request copies of
these documents upon payment of a duplicating fee, by writing to the Commission.
Please call the Commission at 1-800-SEC-0330 for further information on the
operation of the public reference rooms. Dynacs' Commission filings, including
the registration statement will also be available to you on the Commission's
Internet site (http://www.sec.gov).
70
<PAGE> 75
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<S> <C>
CONSOLIDATED FINANCIAL STATEMENTS OF DYNACS INC. AND
SUBSIDIARIES:
Report of Independent Certified Public
Accountants -- Arthur Andersen LLP..................... F-2
Report of Independent Certified Public
Accountants -- Hoyman, Dobson & Company, P.A........... F-3
Consolidated Balance Sheets............................... F-4
Consolidated Statements of Operations..................... F-5
Consolidated Statements of Stockholders' Equity and
Comprehensive Income................................... F-6
Consolidated Statements of Cash Flows..................... F-7
Notes to Consolidated Financial Statements................ F-9
FINANCIAL STATEMENTS OF CERULEAN COLORIZATION, LLC
Report of Independent Certified Public Accountants........ F-25
Balance Sheets............................................ F-26
Statement of Income and Members' Interest................. F-27
Statements of Cash Flows.................................. F-28
Notes of Financial Statements............................. F-29
PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED):
Basis of Presentation..................................... F-34
Pro Forma Consolidated Balance Sheet...................... F-35
Pro Forma Consolidated Statements of Operations........... F-36
Notes to Pro Forma Consolidated Financial Statements...... F-38
</TABLE>
F-1
<PAGE> 76
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To Dynacs Inc. and Subsidiaries:
We have audited the accompanying consolidated balance sheets of Dynacs Inc.
(a Florida corporation) and subsidiaries as of December 31, 1998, and September
30, 1999, and the related consolidated statements of operations, changes in
stockholders' equity and comprehensive income and cash flows for the year ended
December 31, 1998, and for the nine-month period ended September 30, 1999. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits. The consolidated statements of operations, changes in stockholders'
equity and comprehensive income and cash flows of Dynacs Inc. and subsidiaries
for the year ended December 31, 1997, were audited by other auditors whose
report dated August 28, 1998, expressed an unqualified opinion on those
statements.
We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above, present fairly,
in all material respects, the financial position of Dynacs Inc. and subsidiaries
as of December 31, 1998, and September 30, 1999, and the results of their
operations and their cash flows for the year ended December 31, 1998, and the
nine-month period ended September 30, 1999, in conformity with accounting
principles generally accepted in the United States.
Arthur Andersen LLP
Tampa, Florida,
January 21, 2000 (except with respect to
the matters discussed in Notes 6 and 16,
as to which the date is March 28, 2000)
F-2
<PAGE> 77
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To Dynacs Inc. and Subsidiaries
We have audited the accompanying consolidated balance sheet of Dynacs Inc.
(a Florida corporation) and subsidiaries as of December 31, 1997, and the
related consolidated statements of operations, changes in stockholders' equity
and comprehensive income and cash flows for the year then ended. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Dynacs Inc. and subsidiaries
as of December 31, 1997 and the results of their operations and their cash flows
for the year then ended in conformity with accounting principles generally
accepted in the United States.
/s/ HOYMAN, DOBSON & COMPANY, P.A.
Melbourne, Florida
August 28, 1998
F-3
<PAGE> 78
DYNACS INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
DECEMBER 31, SEPTEMBER 30, DECEMBER 31,
1998 1999 1999
------------ ------------- ------------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents................................. $ 172,557 $ 1,094,790 $ 183,397
Accounts receivable....................................... 6,022,961 5,765,434 4,206,661
Unbilled revenue.......................................... 2,054,154 749,195 734,617
Prepaid expenses.......................................... 208,698 91,531 311,748
Deferred tax assets....................................... 376,000 524,000 602,000
----------- ----------- -----------
Total current assets............................... 8,834,370 8,224,950 6,038,423
PROPERTY AND EQUIPMENT, less accumulated depreciation of
$982,218, $2,040,517 and $2,379,643 as of December 31,
1998, September 30, 1999, and December 31, 1999,
respectively.............................................. 1,843,366 3,329,691 3,048,663
FILM LIBRARY AND PRODUCTION COSTS, less accumulated
amortization of $122,581 as of December 31, 1998, and
$235,297 as of September 30, 1999, and December 31,
1999...................................................... 448,333 641,546 1,057,166
NOTES RECEIVABLE............................................ -- 905,000 930,700
DEFERRED TAX ASSET.......................................... -- 713,000 704,000
OTHER ASSETS................................................ 174,988 457,318 485,488
----------- ----------- -----------
Total assets....................................... $11,301,057 $14,271,505 $12,264,440
=========== =========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable.......................................... $ 3,320,776 $ 2,555,127 $ 1,352,894
Accrued expenses.......................................... 2,804,401 3,646,226 3,165,616
Line of credit borrowings................................. 2,473,564 3,226,135 2,955,606
Current portion of long-term debt......................... 957,766 2,676,733 3,031,451
----------- ----------- -----------
Total current liabilities.......................... 9,556,507 12,104,221 10,505,567
----------- ----------- -----------
LONG-TERM LIABILITIES:
Long-term debt, less current portion...................... 664,070 473,012 108,826
Deferred tax liabilities.................................. 32,000 -- --
----------- ----------- -----------
MINORITY INTEREST........................................... -- 393,452 393,452
----------- ----------- -----------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Preferred stock, $.01 par value; 5,000,000 shares
authorized, no shares issued or outstanding at December
31, 1998, September 30, 1999, or December 31, 1999...... -- -- --
Common stock, $.01 par value; 15,000,000 shares
authorized, 4,913,081 shares issued and outstanding at
December 31, 1998, and 5,355,259 shares issued and
outstanding at September 30, 1999, and December 31,
1999.................................................... 49,131 53,553 53,553
Additional paid-in capital................................ (3,891) 2,975,201 3,130,201
Note receivable for common stock.......................... -- (1,125,700) (1,125,700)
Accumulated other comprehensive (loss) income............. (6,996) (6,059) 4,396
Retained earnings (deficit)............................... 1,010,236 (596,175) (805,855)
----------- ----------- -----------
Total stockholders' equity......................... 1,048,480 1,300,820 1,256,595
----------- ----------- -----------
Total liabilities and stockholders' equity......... $11,301,057 $14,271,505 $12,264,440
=========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated balance
sheets.
F-4
<PAGE> 79
DYNACS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE FOR THE FOR THE
YEAR ENDED NINE-MONTH THREE-MONTH PERIOD ENDED
DECEMBER 31, PERIOD ENDED DECEMBER 31,
------------------------- SEPTEMBER 30, -------------------------
1997 1998 1999 1998 1999
----------- ----------- ------------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
REVENUES:
Information and applied
technology..................... $26,068,005 $59,615,270 $53,896,828 $17,290,418 $17,363,517
Media and entertainment........... 892,834 1,331,416 1,398,257 864,816 266,742
----------- ----------- ----------- ----------- -----------
Total revenues............ 26,960,839 60,946,686 55,295,085 18,155,234 17,630,259
----------- ----------- ----------- ----------- -----------
COST OF REVENUES:
Information and applied
technology..................... 22,980,525 56,211,548 51,233,756 16,452,881 15,120,030
Media and entertainment........... 1,007,667 1,817,647 3,063,995 799,273 1,124,644
----------- ----------- ----------- ----------- -----------
Total cost of revenues.... 23,988,192 58,029,195 54,297,751 17,252,154 16,244,674
----------- ----------- ----------- ----------- -----------
GROSS PROFIT........................ 2,972,647 2,917,491 997,334 903,080 1,385,585
GENERAL AND ADMINISTRATIVE
EXPENSES.......................... 2,480,825 2,639,986 3,444,599 1,371,376 1,442,538
----------- ----------- ----------- ----------- -----------
OPERATING INCOME (LOSS)............. 491,822 277,505 (2,447,265) (468,296) (56,953)
INTEREST EXPENSE, net............... 46,522 204,450 491,279 95,035 188,209
LOSS ON EQUITY METHOD INVESTMENT.... 3,196 67,039 27,867 16,760 33,518
----------- ----------- ----------- ----------- -----------
INCOME (LOSS) BEFORE INCOME TAXES... 442,104 6,016 (2,966,411) (580,091) (278,680)
INCOME TAX (PROVISION) BENEFIT...... (178,571) 35,000 1,360,000 279,000 69,000
----------- ----------- ----------- ----------- -----------
NET INCOME (LOSS)................... $ 263,533 $ 41,016 $(1,606,411) $ (301,091) $ (209,680)
=========== =========== =========== =========== ===========
DILUTED NET INCOME (LOSS) PER COMMON
AND COMMON EQUIVALENT SHARE....... $ .03 $ .01 $ (.30) $ (.06) $ (.04)
=========== =========== =========== =========== ===========
DILUTED WEIGHTED AVERAGE COMMON AND
COMMON EQUIVALENT SHARES.......... 7,860,930 7,860,930 5,398,778 4,913,081 5,355,259
=========== =========== =========== =========== ===========
BASIC NET INCOME (LOSS) PER COMMON
SHARE............................. $ .05 $ .01 $ (.30) $ (.06) $ (.04)
=========== =========== =========== =========== ===========
BASIC WEIGHTED AVERAGE COMMON
SHARES............................ 4,913,081 4,913,081 5,398,778 4,913,081 5,355,259
=========== =========== =========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated statements.
F-5
<PAGE> 80
DYNACS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY AND
COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 1997 AND 1998,
THE NINE-MONTH PERIOD ENDED SEPTEMBER 30, 1999, AND
THE THREE-MONTH PERIOD ENDED DECEMBER 31, 1999 (UNAUDITED)
<TABLE>
<CAPTION>
NOTES
RECEIVABLE ACCUMULATED
COMMON STOCK ADDITIONAL FOR COMPREHENSIVE OTHER
------------------- PAID-IN RETAINED COMMON (LOSS) COMPREHENSIVE
SHARES AMOUNT CAPITAL EARNINGS STOCK INCOME LOSS
--------- ------- ---------- ----------- ----------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE, December 31,
1997...................... 4,913,081 $49,131 $ (3,891) $ 969,220 $ -- $ -- $ --
Foreign currency
translation
adjustment.............. -- -- -- -- -- (6,996) (6,996)
Net income................ -- -- -- 41,016 -- 41,016 --
--------- ------- ---------- ----------- ----------- ----------- -------
COMPREHENSIVE NET INCOME.... $ 34,020
===========
BALANCE, December 31,
1998...................... 4,913,081 49,131 (3,891) 1,010,236 -- (6,996)
Issuance of common stock
to a related party...... 353,743 3,538 1,124,162 -- (1,125,700) --
Issuance of warrants in
Cerulean acquisition.... -- -- 1,573,810 -- -- --
Issuance of common stock
for consulting
services................ 88,435 884 281,120 -- -- --
Net loss.................. (1,606,411) -- $(1,606,411) --
Foreign currency
translation
adjustment.............. -- -- -- -- -- 937 937
--------- ------- ---------- ----------- ----------- ----------- -------
COMPREHENSIVE NET LOSS...... $(1,605,474)
===========
BALANCE, September 30,
1999...................... 5,355,259 53,553 2,975,201 (596,175) (1,125,700) (6,059)
Issuance of warrants
(unaudited)............. -- -- 155,000 -- -- --
Net loss (unaudited)...... -- -- -- (209,680) -- $ (209,680) --
Foreign currency
translation adjustment
(unaudited)............. -- -- -- -- -- 10,455 10,455
--------- ------- ---------- ----------- ----------- ----------- -------
COMPREHENSIVE NET LOSS
(UNAUDITED)............... $ (199,255)
===========
BALANCE, December 31, 1999
(unaudited)............... 5,355,259 $53,553 $3,130,201 $ (805,855) $(1,125,700) $ 4,396
========= ======= ========== =========== =========== =======
<CAPTION>
TOTAL
STOCKHOLDERS'
EQUITY
-------------
<S> <C>
BALANCE, December 31,
1997...................... $1,014,460
Foreign currency
translation
adjustment.............. (6,996)
Net income................ 41,016
----------
COMPREHENSIVE NET INCOME....
BALANCE, December 31,
1998...................... 1,048,480
Issuance of common stock
to a related party...... 2,000
Issuance of warrants in
Cerulean acquisition.... 1,573,810
Issuance of common stock
for consulting
services................ 282,004
Net loss.................. (1,606,411)
Foreign currency
translation
adjustment.............. 937
----------
COMPREHENSIVE NET LOSS......
BALANCE, September 30,
1999...................... 1,300,820
Issuance of warrants
(unaudited)............. 155,000
Net loss (unaudited)...... (209,680)
Foreign currency
translation adjustment
(unaudited)............. 10,455
----------
COMPREHENSIVE NET LOSS
(UNAUDITED)...............
BALANCE, December 31, 1999
(unaudited)............... $1,256,595
==========
</TABLE>
The accompanying notes are an integral part of these consolidated statements.
F-6
<PAGE> 81
DYNACS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
FOR THE
FOR THE FOR THE THREE-MONTH
YEAR ENDED NINE-MONTH PERIOD ENDED
DECEMBER 31, PERIOD ENDED DECEMBER 31,
------------------------- SEPTEMBER 30, -------------------------
1997 1998 1999 1998 1999
----------- ----------- ------------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income (loss)............................... $ 263,533 $ 41,016 $(1,606,411) $ (571,341) $ (209,680)
Adjustments to reconcile net income (loss) to
net cash provided by (used in) operating
activities-
Consulting services paid by issuance of common
stock....................................... -- -- 282,004 -- --
Depreciation and amortization................. 210,650 729,678 1,178,192 237,421 355,910
Loss on equity method investment.............. 3,196 67,039 27,867 16,760 23,223
Deferred tax benefit.......................... 44,000 (388,000) (893,000) (50,000) (69,000)
Changes in operating assets and liabilities-
Accounts receivable......................... (1,533,315) (3,096,787) 307,694 240,442 1,558,773
Prepaid expenses............................ (111,752) (91,133) 126,507 (32,527) (220,217)
Unbilled revenue............................ (307,308) (1,402,191) 1,304,959 (1,849,897) 14,578
Other assets................................ 32,724 60,936 (192,645) (100) (68,276)
Accounts payable............................ 641,376 2,226,933 (1,045,895) (560,478) (1,202,232)
Accrued expenses............................ 769,419 1,019,915 841,825 (419,453) (480,610)
----------- ----------- ----------- ----------- -----------
Net cash provided by (used in) operating
activities............................. 12,523 (832,594) 331,097 (2,989,173) (297,531)
----------- ----------- ----------- ----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Notes receivable................................ -- -- (300,000) -- (25,700)
Proceeds from sale of marketable securities..... 14,704 -- -- -- --
Loans to related parties........................ (89,592) -- -- -- --
Contributions to Dynacs Properties.............. -- (230,792) (106,172) -- --
Film production costs........................... -- (570,916) (93,964) (570,916) (415,620)
Purchases of property and equipment............. (858,975) (1,337,950) (1,250,827) (495,220) (57,999)
Cash acquired in connection with Cerulean
acquisition................................... -- -- 194,059 -- --
----------- ----------- ----------- ----------- -----------
Net cash used in investing activities.... (933,863) (2,139,658) (1,556,904) (1,066,136) (499,319)
----------- ----------- ----------- ----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings on line of credit................ 562,835 1,423,729 752,571 997,964 (270,529)
Proceeds from issuance of long-term debt........ 350,000 1,400,000 1,887,395 57,812 502,397
Issuance of common stock........................ -- -- 2,000 -- --
Issuance of stock warrants...................... 155,000
Payment on long-term debt....................... (25,177) (217,839) (494,863) (119,364) (511,866)
----------- ----------- ----------- ----------- -----------
Net cash provided by (used in) financing
activities............................. 887,658 2,605,890 2,147,103 936,412 (124,998)
----------- ----------- ----------- ----------- -----------
NET (DECREASE) INCREASE IN CASH AND CASH
EQUIVALENTS..................................... (33,682) (366,362) 921,296 (3,118,897) (921,848)
EFFECT OF EXCHANGE RATES ON CASH AND CASH
EQUIVALENTS..................................... -- (6,996) 937 (6,996) 10,455
</TABLE>
F-7
<PAGE> 82
<TABLE>
<CAPTION>
FOR THE
FOR THE FOR THE THREE-MONTH
YEAR ENDED NINE-MONTH PERIOD ENDED
DECEMBER 31, PERIOD ENDED DECEMBER 31,
------------------------- SEPTEMBER 30, -------------------------
1997 1998 1999 1998 1999
----------- ----------- ------------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
CASH AND CASH EQUIVALENTS, beginning of period.... 579,597 545,915 172,557 3,298,450 1,094,790
----------- ----------- ----------- ----------- -----------
CASH AND CASH EQUIVALENTS, end of period.......... $ 545,915 $ 172,557 $ 1,094,790 $ 172,557 $ 183,397
=========== =========== =========== =========== ===========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid for-
Interest...................................... $ 48,543 $ 214,432 $ 492,584 $ 98,806 $ 155,632
Income taxes.................................. $ 59,738 $ 296,979 $ 88,000 $ 89,670 $ --
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING
ACTIVITIES:
Acquisition of Cerulean for issuance of warrants
as follows-
Cash.......................................... $ -- $ -- $ 194,059 $ -- $ --
Accounts receivable........................... -- -- 50,167 -- --
Prepaids...................................... -- -- 9,340 -- --
Notes receivable.............................. -- -- 605,000 -- --
Other assets.................................. -- -- 11,380 -- --
Plant, property and equipment................. -- -- 1,300,974 -- --
Film library.................................. -- -- 211,965 -- --
Accounts payable.............................. -- -- (280,246) -- --
Notes payable................................. -- -- (135,377) -- --
Minority interest............................. -- -- (393,452) -- --
----------- ----------- ----------- ----------- -----------
$ -- $ -- $ 1,573,810 $ -- $ --
=========== =========== =========== =========== ===========
Consulting Services paid by issuance of common
stock......................................... $ -- $ -- $ 282,004 $ -- $ --
=========== =========== =========== =========== ===========
Common stock issued to a related party in
exchange for notes receivable................. $ -- $ -- $ 1,125,700 $ -- $ --
=========== =========== =========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated statements.
F-8
<PAGE> 83
DYNACS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1997 AND 1998, AND SEPTEMBER 30, 1999
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
BUSINESS
Dynacs Inc. (Dynacs) and its wholly-owned subsidiaries (collectively, the
Company) are engaged in engineering and research services for both commercial
and governmental entities, primarily in the aerospace industry. Beginning in
1996, the Company also became engaged in the colorization of motion picture
films. The Company is headquartered in Florida with locations in India,
Indonesia and throughout the United States. The Company's revenues are primarily
from engineering contracts and sales from colorization of film footage and other
media throughout the United States.
As a government contractor, the Company is subject to compliance with
Federal Acquisition Regulations (FAR). The FAR requires, among other things,
various audits be performed by the Defense Contract Audit Agency, including
annual audits of the Company's financial records via indirect cost submissions.
The Company has been found to be in compliance for all fiscal years in which an
audit has been completed. The Company believes it is in compliance with FAR
requirements for all subsequent years.
LIQUIDITY
The Company's financial statements have been prepared on the basis that it
is a going concern, which contemplates the realization of assets and the
satisfaction of liabilities in the normal course of business. The Company
experienced a significant operating loss during the nine-month period ended
September 30, 1999, largely attributable to its continuing start-up costs and
investments in the colorization segment (see Note 14). The Company has funded
these costs and investments primarily through additional borrowings, and,
subsequent to September 30, 1999, the Company has continued to obtain additional
financing to cover its working capital needs (see Note 16). The Company believes
that this financing and anticipated funds from future operations will be
sufficient to satisfy the Company's projected working capital and capital
expenditure needs through at least September 30, 2000.
CHANGE IN FISCAL YEAR-END
Effective September 30, 1999, the Company changed its year-end from
December 31 to September 30. The accompanying consolidated statements of
operations, changes in stockholders' equity and cash flows are presented for the
years ended December 31, 1997 and 1998, and the nine-month period
F-9
<PAGE> 84
DYNACS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
ended September 30, 1999. For comparative purposes only, the following table
presents the condensed results of operations (unaudited) for the nine-month
period ended September 30, 1998:
<TABLE>
<CAPTION>
AMOUNT
-----------
(UNAUDITED)
<S> <C>
Total revenues.......................................... $42,791,452
Costs and expenses...................................... 42,205,345
Income before income taxes.............................. 586,107
Provision for income taxes.............................. (244,000)
Net loss................................................ 342,107
Basic net earnings per share............................ .14
Diluted net earnings per share.......................... .09
</TABLE>
ACQUISITION
During 1999, the Company established Cerulean FXs, Inc., a wholly-owned
subsidiary. On August 13, 1999, Cerulean FXs, Inc. acquired all of the
membership interests in Cerulean Colorization LLC and issued to its members (the
Cerulean Members) 20 percent of the shares of Cerulean FXs, Inc. The shares
issued in the exchange were valued at $1,967,262 and are exchangeable at the
option of the Cerulean Members into 701,588 shares of Dynacs common stock, upon
certain events or automatically convert upon the Company's registration
statement being declared effective by the Securities and Exchange Commission
(SEC).
The accompanying consolidated financial statements reflect the acquisition
under the purchase method of accounting and include the results of operations
from August 13, 1999. The purchase price was allocated
F-10
<PAGE> 85
DYNACS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
to the assets acquired and liabilities assumed based on their fair values as of
the date of acquisition and are summarized as follows:
<TABLE>
<CAPTION>
AMOUNT
----------
<S> <C>
Cash and cash equivalents................................ $ 194,059
Accounts receivable...................................... 50,167
Prepaid expenses......................................... 9,340
Notes receivable......................................... 605,000
Other assets............................................. 11,380
Property, plant and equipment............................ 1,300,974
Film library and production costs........................ 211,965
Accounts payable......................................... (280,246)
Notes payable............................................ (135,377)
----------
1,967,262
Less- Minority interest.................................. (393,452)
----------
$1,573,810
==========
</TABLE>
The following unaudited pro forma information is presented assuming the
acquisition of Cerulean had occurred as of the beginning of the periods
presented:
<TABLE>
<CAPTION>
NINE-MONTH
PERIOD
YEAR ENDED ENDED
DECEMBER 31, SEPTEMBER
1998 30, 1999
------------ -----------
(UNAUDITED) (UNAUDITED)
<S> <C> <C>
Revenue........................................... $63,127,398 $56,860,352
Operating Income (Loss)........................... 339,401 (1,397,026)
Net Income (Loss)................................. 131,705 (704,417)
EPS............................................... .03 (.14)
</TABLE>
In addition, in conjunction with the acquisition, the Company reserved
235,828 stock options as contingent consideration, of which an aggregate of
196,523 will be granted to Cerulean Members upon the first stock option grant
under the 1999 Long Term Incentive Plan (see Note 12), and 39,305 will be
granted to one of the Cerulean Members, if, within three years from the date of
the agreement, certain performance goals, as defined, are met.
CONSOLIDATION POLICY
The consolidated financial statements include the accounts of the Company
and its wholly-owned subsidiaries, Cerulean FXs, Inc., Dynacs Engineering
Company (India), Ltd., Dynacs Digital Studios
F-11
<PAGE> 86
DYNACS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(India) PVT. Ltd. and PT Dynacs Digital Studios (Indonesia). All significant
intercompany transactions and balances have been eliminated in consolidation.
The Company's investment in a nonmajority-owned company is accounted for
using the equity method. The investment is included in other assets in the
accompanying consolidated financial statements.
CASH AND CASH EQUIVALENTS
The Company considers all highly liquid debt instruments with original
maturities of three months or less to be cash equivalents.
ACCOUNTS RECEIVABLE
The majority of the Company's accounts receivable are due on demand from
contracts and subcontracts with various United States Government agencies and
its contractors. Therefore, the Company considers these accounts receivable to
be fully collectible and, accordingly, no allowance has been provided.
The Company periodically assesses the collectibility of commercial accounts
receivable. As of December 31, 1998, and September 30, 1999, the Company
believes the commercial accounts receivable are fully collectible and,
accordingly, no allowance has been provided.
PROPERTY AND EQUIPMENT
Property and equipment are stated at cost less accumulated depreciation.
Depreciation is computed using the straight-line method over the estimated
useful lives of the assets. Repair and maintenance costs which do not extend the
useful lives of the assets are expensed as incurred.
The Company is required to review its long-lived assets for impairment
whenever events or changes in circumstances indicate that the carrying amount of
the asset may not be recoverable. Based upon its most recent analysis, the
Company believes that no material impairment of its long-lived assets exists at
December 31, 1998 or September 30, 1999.
FILM LIBRARY AND PRODUCTION COSTS
Film library and production costs consist primarily of film libraries
acquired and direct labor and overhead costs specifically associated with the
colorization of motion picture films. Amortization is computed based on the
individual-film-forecast computation method, which measures the ratio of
current-year revenues to estimated total revenues. Amortization expense for the
year ended December 31, 1998, and the nine-month period ended September 30,
1999, was approximately $123,000 and $112,000, respectively. There was no
amortization expense for the year ended December 31, 1997.
INCOME TAXES
The Company recognizes deferred tax assets and liabilities for the expected
future tax consequences of events that have been recognized in the Company's
financial statements or tax returns. Deferred tax assets and liabilities are
measured by applying enacted statutory tax rates applicable to the future years
in which the related deferred tax assets or liabilities are expected to be
settled or realized. Income tax provision
F-12
<PAGE> 87
DYNACS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
consists of the taxes payable for the current period and the change during the
period in deferred tax assets and liabilities.
FOREIGN CURRENCY TRANSLATION ADJUSTMENT
Foreign currency translation adjustments arise primarily from activities of
the Company's international operations. Results of operations are translated
using the average exchange rates during the period, while assets and liabilities
are translated into U.S. dollars using current rates. Resulting foreign currency
translation adjustments are recorded in stockholders' equity.
REVENUE RECOGNITION
The Company has entered into long-term cost-reimbursable and time and
materials government contracts. The cost-reimbursable contracts provide for the
Company to be reimbursed for allowable incurred costs plus a fee based on
performance measures of quality, timeliness, ingenuity and cost-effectiveness.
Revenues from the reimbursement of incurred costs and the performance award fee
are recognized under the percentage of completion method. The Company assesses
the status of the performance fee on a periodic basis and any necessary
revisions are made prospectively. Contract costs include all direct material and
labor costs and those indirect costs related to contract performance, such as
indirect labor, supplies, tools, repairs and depreciation costs. Under time and
materials contracts, the Company is paid a fixed hourly rate for direct labor
hours expended and reimbursed for direct expenses plus applied indirect, general
and administrative expenses. Revenues are recognized as the direct labor hours
and direct expenses are incurred.
Revenues from media and entertainment are derived from two contract types,
work for hire and royalties. Work for hire consists of long-term contracts in
which the Company receives a fee based on the number of minutes of film to be
colorized. Revenues from work for hire contracts are recognized under the
percentage of completion method. Contract costs include direct labor and
overhead costs specifically related to the production activities. Royalties
contracts include the sales of exhibition rights for films included in the
Company's film library. Revenue is recognized on these contracts when all of the
following conditions have been met: 1) the royalty fee for each film is known;
2) the cost of each film is known or reasonably determinable; 3) collectibility
of the full royalty fee is reasonably assured; 4) the film has been accepted by
the licensee in accordance with the conditions of the contract; and 5) the film
is available for its first showing or telecast. Once all of these conditions are
met, the Company recognizes revenue at the time the licensee is able to exercise
the rights under the contract.
Professional services performed and reimbursable costs incurred on
contracts, which have been authorized but not billed, are classified as unbilled
revenue.
USE OF ESTIMATES
The preparation of consolidated financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the consolidated
financial statements and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from those estimates.
F-13
<PAGE> 88
DYNACS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
Significant estimates made by the Company include: revenue for performance
awards, percentage of completion of long-term contracts, amortization of film
library and production costs based on total expected revenues and impact of
audits of federal government contracts.
NET INCOME PER COMMON SHARE
Basic net income (loss) per common share was determined by dividing net
income by the weighted average number of shares of common stock outstanding
during the year. Diluted net income (loss) per common and common equivalent
share was determined by dividing net income by the weighted average number of
shares of common stock outstanding and dilutive common equivalent shares from
stock options and stock warrants, using the treasury stock method.
CONCENTRATION OF CREDIT RISK
Financial instruments which potentially expose the Company to concentration
of credit risk consist primarily of accounts receivable. During the year ended
December 31, 1998, and nine-month period ended September 30, 1999, the Company
generated 97 percent and 88 percent, respectively, of its revenues from three
major customers, for services provided as a prime contractor or subcontractor to
agencies of the federal government. Funding for these projects results from
budget appropriations by the United States Congress.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The carrying amounts of the Company's financial instruments as of December
31, 1998, and September 30, 1999, approximate fair value.
RECLASSIFICATIONS
Certain reclassifications have been made to the December 31, 1997 and 1998,
financial statements to conform with the September 30, 1999, presentation.
INTERIM FINANCIAL INFORMATION
As is normal and customary, the interim financial statements as of December
31, 1999, and for the three-month periods ended December 31, 1998 and 1999, are
unaudited, and certain information normally included in financial statements
prepared in accordance with generally accepted accounting principles has not
been included herein. In the opinion of management, all adjustments necessary to
fairly present the financial position, results of operations and cash flows with
respect to the interim financial statements have been properly included. Due to
seasonality and other factors, the results of operations for the interim period
are not necessarily indicative of the results that will be realized for the
entire fiscal year.
F-14
<PAGE> 89
DYNACS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
2. ACCOUNTS RECEIVABLE:
Accounts receivable consisted of the following as of December 31, 1998, and
September 30, 1999:
<TABLE>
<CAPTION>
DECEMBER 31, SEPTEMBER 30,
1998 1999
------------ -------------
<S> <C> <C>
U.S. Government agencies and prime contractors,
including retainage of $50,000.................. $5,477,670 $5,281,507
Commercial customers.............................. 27,169 281,927
Medical insurance reimbursement................... 518,122 --
Income tax refund receivable...................... -- 202,000
---------- ----------
$6,022,961 $5,765,434
========== ==========
</TABLE>
Pursuant to one governmental subcontract agreement, retainage of 5 percent
of billings, not to exceed $50,000, is to be withheld until execution and
delivery of a release by the governmental agency.
3. NOTES RECEIVABLE:
Notes receivable consisted of the following at September 30, 1999:
<TABLE>
<CAPTION>
AMOUNT
--------
<S> <C>
Note receivable from nominated director, bears interest at
5.7%, principal and accrued interest are due August 2004,
secured by the nominated director's interest in common
stock of Cerulean FXs, Inc............................... $300,000
Note receivable, bears interest at 8.5%, due as the Company
generates revenue from the sale of the motion picture
film rights.............................................. 605,000
--------
$905,000
========
</TABLE>
4. PROPERTY AND EQUIPMENT:
Property and equipment consisted of the following as of December 31, 1998,
and September 30, 1999:
<TABLE>
<CAPTION>
DECEMBER 31, SEPTEMBER 30,
USEFUL LIVES 1998 1999
------------ ------------ -------------
<S> <C> <C> <C>
Computer equipment and software............. 5 $2,058,526 $3,544,158
Furniture, fixtures and equipment........... 5-7 767,058 1,826,050
---------- ----------
2,825,584 5,370,208
Less-Accumulated depreciation............... (982,218) (2,040,517)
---------- ----------
$1,843,366 $3,329,691
========== ==========
</TABLE>
F-15
<PAGE> 90
DYNACS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
Depreciation expense for the year ended December 31, 1998, and the
nine-month period ended September 30, 1999, was approximately $492,000 and
$1,065,000, respectively.
5. ACCRUED EXPENSES:
Accrued expenses consisted of the following as of December 31, 1998, and
September 30, 1999:
<TABLE>
<CAPTION>
DECEMBER 31, SEPTEMBER 30,
1998 1999
------------ -------------
<S> <C> <C>
Accrued salaries and related taxes................ $1,304,920 $1,297,238
Accrued vacation.................................. 1,022,111 1,705,475
Other accrued expenses............................ 477,370 643,513
---------- ----------
$2,804,401 $3,646,226
========== ==========
</TABLE>
6. LINE OF CREDIT:
The Company has a line of credit (the Line) with a financial institution.
The Line provided for maximum borrowings of $3,000,000 at December 31, 1998, and
increased to $4,000,000 in January 1999. The Line bears interest at the greater
of the bank's prime rate plus 2 percent (10.25 percent as of September 30, 1999)
or 9.75 percent. Interest is payable monthly and the principal balance is
payable upon demand. In February 2000, the Company received a commitment from
the financial institution to extend the Line through June 2000. As of December
31, 1998, and September 30, 1999, amounts available under the Line were $526,436
and $773,865, respectively. The Line is collateralized by all furniture,
fixtures and equipment and accounts receivable. The Line is also personally
guaranteed by the principal stockholder.
The Company is subject to a borrowing base, which limits Line advances to
90 percent of accounts receivable derived from engineering services. The Line
contains certain non-financial covenants, including restrictions on the use of
funds. As of September 30, 1999, the Company is in compliance with, or had
obtained waivers for non-compliance with, all covenants.
F-16
<PAGE> 91
DYNACS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
7. LONG-TERM DEBT:
Long-term debt consisted of the following as of December 31, 1998, and
September 30, 1999:
<TABLE>
<CAPTION>
DECEMBER 31, SEPTEMBER 30,
1998 1999
------------ -------------
<S> <C> <C>
Notes payable to related parties, bearing interest
at rates ranging from 10 percent to 12 percent,
principal and interest payable monthly, $822,213
secured by revenues from colorization contracts
with the remainder unsecured, maturities
throughout 2000................................. $1,237,167 $2,117,650
Note payable to a financial institution, bearing
interest at 8.75 percent, principal and interest
payable monthly beginning December 25, 1998,
collateralized by furniture, fixtures and
equipment, personally guaranteed by principal
stockholder, matures November 2000.............. 384,669 241,831
Notes payable, bearing interest at rates ranging
from 12 percent to 14.5 percent, interest
payable monthly starting October 1999,
unsecured, maturities throughout 2000........... -- 700,000
Obligations under capital lease................... -- 90,264
---------- ----------
1,621,836 3,149,745
---------- ----------
Less-Current maturities of long-term debt......... (957,766) (2,676,733)
---------- ----------
$ 664,070 $ 473,012
========== ==========
</TABLE>
The remaining balance of long term debt matures during 2001.
F-17
<PAGE> 92
DYNACS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
8. INCOME TAXES:
Significant components of income tax provision (benefit) are summarized as
follows as of December 31, 1997 and 1998, and September 30, 1999:
<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31, SEPTEMBER 30,
1997 1998 1999
------------ ------------ -------------
<S> <C> <C> <C>
Current:
Federal................................... $119,775 $ 314,170 $ (415,630)
State..................................... 14,796 38,830 (51,370)
-------- --------- -----------
134,571 353,000 (467,000)
-------- --------- -----------
Deferred:
Federal................................... 39,160 (345,320) (794,770)
State..................................... 4,840 (42,680) (98,230)
-------- --------- -----------
44,000 (388,000) (893,000)
-------- --------- -----------
$178,571 $ (35,000) $(1,360,000)
======== ========= ===========
</TABLE>
Income tax expense differs from the amount computed by applying the U.S.
federal corporate tax rate of 34 percent to income before income tax expense as
follows, as of December 31, 1997 and 1998, and September 30, 1999:
<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 31, SEPTEMBER 30,
1997 1998 1999
------------ ------------ -------------
<S> <C> <C> <C>
Statutory U.S. federal income tax provision
(benefit)................................. $150,315 $ 2,045 $(1,008,580)
Foreign income tax credit................... -- (62,000) (237,948)
Meals and entertainment..................... 9,688 21,346 35,795
State taxes, net of federal benefit......... 18,568 2,795 (149,561)
Other....................................... -- 814 294
-------- -------- -----------
Effective income tax provision
(benefit).............................. $178,571 $(35,000) $(1,360,000)
======== ======== ===========
</TABLE>
Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the corresponding amounts used for
F-18
<PAGE> 93
DYNACS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
income tax reporting purposes. Significant components of the Company's deferred
tax assets (liabilities) as of December 31, 1998, and September 30, 1999, are as
follows:
<TABLE>
<CAPTION>
DECEMBER 31, SEPTEMBER 30,
1998 1999
------------ -------------
<S> <C> <C>
Net operating loss (NOL) carryforward..................... $ -- $ 751,000
Accrued vacation.......................................... 310,000 513,000
Other accrued expenses.................................... 40,000 --
Investment in equity method............................... 26,000 11,000
Depreciation.............................................. (32,000) (38,000)
-------- ----------
Net deferred tax assets................................. $344,000 $1,237,000
======== ==========
</TABLE>
The Company has federal and state NOL carryforwards which expire in 2014.
9. PROFIT SHARING PLAN:
The Company maintains a qualified deferred compensation plan (the Plan)
under Section 401(k) of the Internal Revenue Code (IRC), covering substantially
all employees. Under the Plan, employees may elect to defer up to 15 percent of
their salary, subject to IRC limitations. The Company makes matching
contributions of 50 percent of employee deferrals up to 2 1/2 percent of the
employee's wages. For the years ended December 31, 1997 and 1998, and the
nine-month period ended September 30, 1999, the Company's matching contributions
totaled $294,624, $634,019 and $422,984, respectively. The Plan also allows
discretionary employer profit sharing contributions. As of December 31, 1998,
and September 30, 1999, the Company has accrued $75,000 and $58,000 in
discretionary profit sharing contributions, respectively.
10. SELF-INSURANCE:
The Company has an agreement whereby it is self-insuring the health care of
its employees and covered dependents up to $35,000 per year per employee and
covered dependents. Health care expenses of covered individuals in excess of
$35,000 per year are paid out of insurance purchased by the Company.
Administration of the self-insurance is handled by a third-party administrator.
Provisions for expected future payments are accrued based on the Company's
estimate of its aggregate liability for all open and unreported claims.
Management believes the amount currently accrued is adequate to cover all known
and unreported claims at September 30, 1999. For the years ended December 31,
1997 and 1998, and the nine-month period ended September 30, 1999, the annual
aggregate liability calculated by the insurance company was $1,645,842. The
total amount of claims and premiums paid by the Company under this policy for
years ended December 31, 1997 and 1998, and the nine-month period ended
September 30, 1999, were approximately $79,736, $2,164,000 and $1,458,000,
respectively. The Company had a receivable of $518,122 at December 31, 1998, due
to advancing more money for claims than the aggregate liability limit. This
amount was collected during 1999.
F-19
<PAGE> 94
DYNACS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
11. COMMON STOCK:
On January 25, 1999, the Company issued 353,742 shares (adjusted for the
stock splits) of the Company's common stock, at approximately $3.19 (adjusted
for stock splits) per share, to one of its senior vice presidents, who is also
the Company's corporate secretary. Concurrent with this issuance, the Company
entered into an agreement whereby the Company loaned the $1,127,700 purchase
price to the corporate secretary. The loan bears interest at the prime rate and
is payable in full on January 25, 2002. The loan is collateralized by the shares
of common stock purchased by the corporate secretary. The loan has been
classified as a reduction of additional paid-in capital in the accompanying
consolidated financial statements.
On May 10, 1999, the Company issued 88,435 shares (adjusted for the stock
splits) of common stock to a brother of the corporate secretary for consulting
services rendered. The Company recognized consulting expense of approximately
$282,000 for the difference between the issue price and the fair market value of
the common stock at May 10, 1999.
12. STOCK OPTION PLANS:
As of December 31, 1998, the Company had 2,947,849 outstanding options
granted in 1993 to its President to purchase one share each of the Company's
common stock at $0.02 per share, the fair value at date of grant. During 1999,
the President voluntarily surrendered 2,751,326 outstanding options. At
September 30, 1999, 196,523 (adjusted for the stock splits) options remained
outstanding. The stock options are fully vested and have no expiration date.
On November 12, 1999, the Company implemented a stock incentive program,
the 1999 Long Term Incentive Plan (the Incentive Plan), providing for the
issuance of incentive stock options, non-qualified stock options, stock
appreciation rights, restricted stock, deferred stock, stock purchase rights and
other stock-based awards. The Incentive Plan provides for the issuance of
864,702 Shares of the Company's common stock. The terms for any awards under the
Incentive Plan will be set at the time of the award. As of September 30, 1999,
no incentive awards have been issued under the Incentive Plan.
A summary of the Company's stock options for the year ended December 31,
1998, and the nine-month period ended September 30, 1999, is presented in the
following table:
<TABLE>
<CAPTION>
1998 1999
--------------------- ---------------------
WEIGHTED WEIGHTED
AVERAGE AVERAGE
EXERCISE EXERCISE
OPTIONS PRICE OPTIONS PRICE
--------- -------- --------- --------
<S> <C> <C> <C> <C>
Outstanding options beginning of year... 2,947,849 $0.02 2,947,849 $0.02
Granted................................. -- -- -- --
Exercised............................... -- -- -- --
Forfeited............................... -- -- 2,751,326 $0.02
Expired................................. -- -- -- --
EOY..................................... 2,947,849 $0.02 196,523 $0.02
</TABLE>
F-20
<PAGE> 95
DYNACS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
13. NET INCOME PER SHARE:
The following is a reconciliation of the denominator of basic earnings per
share (EPS) to diluted EPS, as shown on the face of the accompanying
consolidated statements of operations for the years ended December 31, 1997 and
1998, and the nine-month period ended September 30, 1999:
<TABLE>
<CAPTION>
NUMBER OF SHARES
-----------------------------------
1997 1998 1999
--------- --------- ---------
<S> <C> <C> <C>
Basic weighted average common shares.............. 4,913,081 4,913,081 5,398,778
Dilutive effect of options outstanding............ 2,947,849 2,947,849 --
--------- --------- ---------
Diluted weighted average common and common
equivalent shares............................... 7,860,930 7,860,930 5,398,778
========= ========= =========
</TABLE>
For the nine-month period ended September 30, 1999, the dilutive effect of
options outstanding was 211,296. These shares are not included in the diluted
weighted average common and common equivalent shares shown above as the effect
of these options is anti-dilutive.
14. SEGMENT REPORTING:
The Company operates through two business segments which offer distinct
services. The Company's Information and Applied Technology (IAT) segment
includes engineering and research services provided to government and commercial
entities, primarily in the aerospace industry. The Company's Media and
Entertainment segment, which began in 1996, is engaged in the colorization of
film footage and other media.
F-21
<PAGE> 96
DYNACS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
Reportable business segment information is as follows:
<TABLE>
<CAPTION>
INFORMATION AND MEDIA AND
APPLIED TECHNOLOGY ENTERTAINMENT CONSOLIDATED
------------------ ------------- ------------
<S> <C> <C> <C>
DECEMBER 31, 1997
Revenue................................ $26,068,005 $ 892,834 $26,960,839
Depreciation and amortization.......... 83,163 134,452 217,615
Net operating income (loss)............ 774,400 (282,578) 491,822
Purchases of property and equipment.... 177,411 681,564 858,975
Total assets........................... 4,399,665 911,634 5,311,299
DECEMBER 31, 1998
Revenue................................ 59,615,270 1,331,416 60,946,686
Depreciation and amortization.......... 316,386 413,292 729,678
Net operating income (loss)............ 944,841 (667,336) 277,505
Purchases of property and equipment.... 596,474 741,476 1,337,950
Total assets........................... 8,355,656 2,945,401 11,301,057
SEPTEMBER 30, 1999
Revenue................................ 53,896,828 1,398,257 55,295,085
Depreciation and amortization.......... 654,292 411,184 1,065,476
Net operating income (loss)............ 957,772 (3,405,037) (2,447,265)
Purchases of property and equipment.... 400,337 2,151,464 2,551,801
Total assets........................... 9,708,061 4,563,444 14,271,505
</TABLE>
The Company operates in two geographical areas, domestic and international.
As of December 31, 1998, and September 30, 1999, the domestic offices had
long-lived assets of $1,556,510 and $2,895,117, respectively, located throughout
the United States and the international offices had long-lived assets of
$735,189 and of $1,076,120, respectively, located in India and Indonesia. For
the years ended December 31, 1997 and 1998, and the nine-month period ended
September 30, 1999, all sales were to domestic customers.
F-22
<PAGE> 97
DYNACS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
15. COMMITMENTS AND CONTINGENCIES:
OPERATING LEASES
The Company leases various office space under non-cancelable operating
leases expiring in 2000 through 2004. Minimum future rental payments under
operating leases as of September 30, 1999, for each of the next five years and
in the aggregate are as follows:
<TABLE>
<CAPTION>
AMOUNT
----------
<S> <C>
YEAR ENDING SEPTEMBER 30,
2000..................................................... $1,117,284
2001..................................................... 1,129,097
2002..................................................... 1,110,393
2003..................................................... 1,045,212
2004..................................................... 71,993
Thereafter............................................... 3,618
----------
$4,477,597
==========
</TABLE>
Total rent expense for the years ended December 31, 1997 and 1998, and the
nine-month period ended September 30, 1999, was $231,000, $1,322,661 and
$1,195,408, respectively, of which approximately $18,807, $69,000 and $72,000,
respectively, relates to rent paid to the Company's nonmajority-owned
investment.
CONTINGENCIES
The Company is currently in litigation involving the wrongful termination
of a contract for colorization of a full-length feature film. The case has been
referred to arbitration. The final arbitration hearing was scheduled for
February 2000, and a final determination is not expected before April 2000. The
outcome of this arbitration is unknown. The amount of the potential loss for the
Company is estimated at $950,000. The amount of potential gain is estimated at
$2,825,000 less any successful claims brought by the licensor of the
colorization software. At this stage in the proceedings, management believes it
is not possible to determine the probable outcome of this matter and no amounts
have been recorded in the Company's financial statements as of December 31,
1998, or September 30, 1999.
The Company is also involved in various legal actions arising in the normal
course of business. While it is not possible to determine with certainty the
outcome of these matters, in the opinion of management, the eventual resolution
of these claims and actions outstanding will not have a material adverse effect
on the Company's financial position or results of operations.
16. SUBSEQUENT EVENTS:
NOTES PAYABLE
In November 1999, the Company issued $500,000 of convertible debt with
84,225 (adjusted for the stock splits)of detachable warrants. Subsequent to
December 31, 1999, the Company issued an additional $2,400,000 of convertible
debt with 404,276 (adjusted for the stock splits) detachable warrants. The notes
F-23
<PAGE> 98
DYNACS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
bear interest at 8 percent for the first 120 days after issuance, then increase
to 15 percent. The notes are convertible 120 days after issuance into common
stock at 60 percent of the price per share at the date of a liquidity event, as
defined. The notes are personally guaranteed by the Company's principal
stockholder and mature 12 months after issuance. The warrants are exercisable
one year after issuance at 70 percent of the price per share at the date of a
liquidity event, as defined. One year after issuance but prior to a liquidity
event, the warrants are exercisable at the fair market value of common stock, as
determined by the Company's Board of Directors (the Board). The warrants expire
five years from the date of issuance or four years from the date of a liquidity
event, as defined.
The Company allocated the proceeds from the issuance of the notes payable
between long-term debt and warrants based on the relative fair values of the
debt without the warrants and the warrants themselves at the time of issuance.
The estimated fair value of the warrants was computed based on the application
of the Black-Scholes option pricing model which incorporates current stock
prices, expected stock price volatility, expected interest rates and the
expected holding period of the stock. At the date of issuances, $345,000 and
$155,000 were allocated to the long-term debt and warrants, respectively. The
difference between the face amount of the notes payable and the amount allocated
to them has been recorded as a discount on the notes payable. This discount is
being amortized to interest expense over the 12-month term of the debt using the
effective interest method. Interest expense of $25,833 was recorded during the
three-month period ended December 31, 1999.
In addition, the Company has calculated an intrinsic value for the
Beneficial Conversion. Feature (BCF) related to these convertible notes payable
of $333,333. The BCF was calculated based on the number of shares the notes
payable are convertible into multiplied by the expected discount from fair
market value on the date of conversion. The BCF has not been recognized as of
December 31, 1999, as it is contingent on the occurrence of a liquidity event.
STOCK OPTIONS
In February 2000, the Company committed to grant options to purchase common
stock of the Company to certain nominated directors upon the effective date of
an Initial Public Offering. The nominated directors and consultants will receive
63,636 options at an exercise price equal to the opening price per share upon
the Company's registration statement being declared effective by the SEC. The
options vest ratably over a two-year period.
CHANGE IN CORPORATE STRUCTURE
In February 2000, the Board approved a merger of Dynacs Engineering
Company, Inc. into Dynacs Inc., a Delaware Corporation. Dynacs Inc. of Delaware
became the surviving corporation. In conjunction with the merger, the par value
of the Company's preferred and common stock was changed from $.001 to $.01. The
changes in the Company's name and par values have been reflected retroactively
in these financial statements.
STOCK SPLITS
On August 11, 1999, and March 28, 2000, the Company approved stock splits,
whereby each outstanding share of the Company's common stock was converted into
1,750 and 1.12299 shares of common stock, respectively. The accompanying
consolidated financial statements have been retroactively adjusted as a result
of the stock splits.
F-24
<PAGE> 99
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Members of Cerulean Colorization, LLC:
We have audited the accompanying balance sheets of Cerulean Colorization,
LLC (the Company) as of December 31, 1998 and 1997, and the related statements
of income and members' interest and cash flows for the years then ended. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion the financial statements referred to above present fairly in
all material respects, the financial position of Cerulean Colorization, LLC as
of December 31, 1998 and 1997, and the results of its operations and its cash
flows for the years then ended in conformity with generally accepted accounting
principles.
ARTHUR ANDERSEN LLP
Los Angeles, California
November 30, 1999
F-25
<PAGE> 100
CERULEAN COLORIZATION, LLC
BALANCE SHEETS
AS OF DECEMBER 31, 1998 AND 1997
<TABLE>
<CAPTION>
1998 1997
---------- ----------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash...................................................... $ 436 $ 8,128
Accounts receivable, net of allowance for doubtful
accounts of $96,200 and $45,950, respectively.......... 25,124 38,310
Unbilled revenue.......................................... 140,250 --
Prepaid contracts......................................... 687,790 372,872
Prepaid expenses.......................................... 9,340 --
---------- ----------
Total current assets.............................. 862,940 419,310
---------- ----------
PROPERTY AND EQUIPMENT, net................................. 328,156 615,522
---------- ----------
OTHER ASSETS:
Film library.............................................. 500,000 37,500
Note receivable........................................... 605,000 --
Goodwill, net............................................. 34,670 69,375
Deposits.................................................. 11,000 11,000
---------- ----------
1,150,670 117,875
---------- ----------
$2,341,766 $1,152,707
========== ==========
LIABILITIES AND MEMBERS' INTEREST
CURRENT LIABILITIES:
Short-term borrowings..................................... $ -- $ 125,000
Advance from member....................................... 4,000 130,000
Bank overdraft............................................ 1,091 --
Accounts payable.......................................... 211,346 104,916
Payable to subcontractor.................................. 1,054,283 --
Other payable............................................. 178,500 --
Accrued expenses.......................................... 35,806 29,942
Billings in excess of revenue earned...................... 665,624 718,000
Current portion of capital lease liability................ 8,602 11,764
---------- ----------
Total current liabilities......................... 2,159,252 1,119,622
---------- ----------
CAPITAL LEASE LIABILITY, net of current portion............. -- 8,602
OTHER LIABILITIES........................................... 79,289 68,004
COMMITMENTS AND CONTINGENCIES
MEMBERS' INTEREST........................................... 103,225 (43,521)
---------- ----------
$2,341,766 $1,152,707
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-26
<PAGE> 101
CERULEAN COLORIZATION, LLC
STATEMENTS OF INCOME AND MEMBERS' INTEREST
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997
<TABLE>
<CAPTION>
1998 1997
---------- ----------
<S> <C> <C>
REVENUE..................................................... $3,152,752 $ 873,578
COST OF REVENUES............................................ 2,095,089 616,307
---------- ----------
GROSS PROFIT................................................ 1,057,663 257,271
---------- ----------
SELLING, GENERAL AND ADMINISTRATIVE......................... 995,767 1,228,357
---------- ----------
INCOME (LOSS) FROM OPERATIONS............................... 61,896 (971,086)
OTHER INCOME (EXPENSES), net................................ 84,850 (2,435)
---------- ----------
NET INCOME (LOSS)........................................... 146,746 (973,521)
MEMBERS' INTEREST, beginning of period...................... (43,521) 930,000
---------- ----------
MEMBERS' INTEREST, end of period............................ $ 103,225 $ (43,521)
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-27
<PAGE> 102
CERULEAN COLORIZATION, LLC
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997
<TABLE>
<CAPTION>
1998 1997
---------- ---------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)......................................... $ 146,746 $(973,521)
Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities:
Depreciation and amortization........................... 323,423 316,394
Loss on sale of property and equipment.................. -- 5,285
Changes in assets and liabilities:
Accounts receivable, net............................. 13,186 (38,310)
Unbilled revenue..................................... (140,250) --
Prepaid contracts.................................... (314,918) (372,872)
Prepaid expenses..................................... (9,340) --
Deposits............................................. -- (11,000)
Bank overdraft....................................... 1,091 --
Accounts payable..................................... 106,430 104,916
Payable to subcontractor............................. 1,054,283 --
Accrued expenses..................................... 5,864 29,942
Billings in excess of revenue earned................. (52,376) 718,000
Other liabilities.................................... 11,285 68,004
---------- ---------
Net cash provided by (used in) operating activities..... 1,145,424 (153,162)
---------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment....................... (1,352) (57,076)
Proceeds from sale of property and equipment.............. -- 4,625
Purchase of film library.................................. (284,000) (37,500)
Cash paid for note receivable............................. (605,000) --
---------- ---------
Net cash used in investing activities................... (890,352) (89,951)
---------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from short-term borrowings....................... -- 125,000
Repayments of short-term borrowings....................... (125,000) --
Proceeds from advance from member......................... 138,200 130,000
Repayments of advance from member......................... (264,200) --
Payments of capital lease obligation...................... (11,764) (8,759)
---------- ---------
Net cash (used in) provided by financing activities..... (262,764) 246,241
---------- ---------
Net (decrease) increase in cash......................... (7,692) 3,128
CASH, beginning of period................................... 8,128 5,000
---------- ---------
CASH, end of period......................................... $ 436 $ 8,128
========== =========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest.................................... $ 5,957 $ 3,759
Cash paid for income taxes................................ $ -- $ --
========== =========
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING ACTIVITIES:
Acquisition of equipment under a capital lease............ $ -- $ 29,125
Acquisition of film library in exchange for other
payable................................................. $ 178,500 $ --
========== =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-28
<PAGE> 103
CERULEAN COLORIZATION, LLC
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
1. THE COMPANY
Cerulean Colorization, LLC, (the Company) is a limited liability company
established in December 1996. The Company is engaged in colorization of motion
picture films, television series, commercials, and other films. Many of the
Company's customers are in the entertainment industry and are located primarily
in Southern California.
As discussed in Note 7, in August 1999, Dynacs Engineering Company, Inc.
(Dynacs) of Palm Harbor, Florida acquired all of the membership interests in the
Company through Dynacs' wholly-owned subsidiary, Cerulean FXs, Inc. Prior to the
acquisition, the Company subcontracted colorization projects to Dynacs. After
the acquisition, the Company's operations were absorbed into Dynacs as a part of
Dynacs' colorization line of business and the Company ceased operations as a
separate entity.
The Company incurred a substantial loss in the year ended December 31, 1997
and has a negative working capital of $1,296,312 as of December 31, 1998. Dynacs
and the Company believe that anticipated funds from future operations will be
sufficient to satisfy the Company's projected working capital and capital
expenditure needs. The accompanying financial statements have been presented on
the basis that it is a going concern, which contemplates realization of assets
and satisfaction of debt in the normal course of business. Through the date of
acquisition in August 1999, the Company funded operations primarily with cash
provided by operating activities.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the period.
Actual results could differ from those estimates.
ALLOWANCE FOR DOUBTFUL ACCOUNTS
The following is an analysis of the activities in the allowance for
doubtful accounts for the years ended December 31, 1998 and 1997:
<TABLE>
<CAPTION>
1998 1997
------- -------
<S> <C> <C>
Beginning of period...................................... $45,950 $ --
Provision................................................ 50,250 45,950
Write-off's.............................................. -- --
------- -------
End of period............................................ $96,200 $45,950
======= =======
</TABLE>
F-29
<PAGE> 104
CERULEAN COLORIZATION, LLC
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
PROPERTY AND EQUIPMENT
Property and equipment are stated at cost. Depreciation is computed using
the straight-line method over the estimated lives of the assets. Property and
equipment consists of the following:
<TABLE>
<CAPTION>
1998 1997 USEFUL LIVES
-------- -------- ------------
<S> <C> <C> <C>
Machinery and equipment............................ $610,235 $608,883 3 to 5 years
Furniture and fixtures............................. 42,568 42,568 3 years
Software........................................... 245,760 245,760 3 years
-------- --------
898,563 897,211
Less -- Accumulated depreciation and
amortization..................................... (570,407) (281,689)
-------- --------
Property and equipment, net........................ $328,156 $615,522
======== ========
</TABLE>
FILM LIBRARY
In May 1997, the Company entered into an agreement with a producer of a
television series and a distributor under which the distributor purchased
exclusive rights throughout the world to exploit the television series,
consisting of 65 episodes, in exchange for a right to the future revenue from
the series. The Company purchased from the producer a right to 50 percent of
such future revenue for $500,000. The Company paid $321,500 of this amount in
cash in the years ended December 31, 1998 and 1997, and the remaining $178,500
was outstanding as of December 31, 1998. This amount bears no interest and is
due on demand. The cost of the film library is to be amortized over the
estimated period of exploitation based on the percentage of revenue received
from the series to total estimated revenue. In the years ended December 31, 1998
and 1997, no revenue was received from the series, and accordingly no
amortization of film library was recorded. Based on the estimated total revenue
from the series, the Company believes that the cost of film library as of
December 31, 1998 is fully realizable.
In connection with the purchase of film library, the Company also loaned
the producer $605,000 in exchange for a note for the purpose of clearing a lien
that was on the series. The note bears interest at 8.50 percent and is payable
to the Company out of the first $605,000 of the producer's 50 percent share of
the future revenue from the series. The note is without recourse. Based on the
estimated total revenue from the series, the Company believes that the balance
of the note as of December 31, 1998 is fully realizable.
The revenue to be received by the Company and the producer is gross
receipts from the series less certain costs as specified in the agreement
including costs of colorization and distribution. The agreement also states that
such colorization of the series is to be performed by the Company for $40,000
per episode. In the year ended December 31, 1998, the Company earned $2,080,000
of the $2,600,000 to be earned in total from such colorization projects.
GOODWILL
In December 1996, the Company acquired certain assets of CST Entertainment,
Inc., CST Featurizations, Inc., and CST Computoons, Inc. (collectively CST) in
exchange for a cash payment of $925,000. The acquisition was accounted for as a
purchase. Accordingly, the purchase price was allocated
F-30
<PAGE> 105
CERULEAN COLORIZATION, LLC
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
to the assets acquired based on their estimated fair market values at the
closing date. The excess of purchase price over the estimated fair value of the
assets acquired was recorded as goodwill, and is being amortized using the
straight-line method over a period of three years. The Company recorded
amortization of goodwill of $34,705 in the years ended December 31, 1998 and
1997. The results of operations of the acquired business are included in the
accompanying financial statements since the date of the acquisition.
REVENUE RECOGNITION
The Company generates revenue from colorization of motion picture films,
television series, commercials, and other films. Revenue from long-term
colorization contracts is recognized based on the percentage-of-completion
method measured by the percentage of costs incurred to date to total estimated
costs for each contract. Costs of contracts primarily represent subcontracting
expense to Dynacs. For short-term projects, revenue is recognized upon
completion of the project.
Unbilled revenue and billings in excess of revenue earned result from the
difference between the amounts billed to the customer and the revenue recognized
based on the percentage of completion of the contract, and are analyzed on a
contract-by-contract basis.
Prepaid contracts represent amounts paid or payable to Dynacs in excess of
costs incurred by Dynacs.
SIGNIFICANT CUSTOMER
In the year ended December 31, 1998, one customer accounted for 83 percent
of total revenue.
CONCENTRATIONS OF CREDIT RISK
Financial instruments that potentially subject the Company to
concentrations of credit risk consist primarily of accounts receivable and
unbilled revenue. As of December 31, 1998 and 1997, approximately 81 percent and
85 percent of accounts receivable were concentrated with one and two customers,
respectively. As of December 31, 1998, all of unbilled revenue was concentrated
with one customer.
INCOME TAXES
The Company is a limited liability company and is treated as a partnership
for Federal and state income tax purposes. Accordingly, the Company's taxable
income or losses are included in the income tax returns of the Company's
members.
F-31
<PAGE> 106
CERULEAN COLORIZATION, LLC
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
3. SHORT-TERM BORROWINGS
In 1997 the Company had a line of credit agreement (the Agreement) with a
bank, which expired in June 1998. Under the Agreement the Company could borrow
up to $125,000. Interest was payable monthly at the rate of 1.75 percent per
annum over the prime rate (8.50 percent at December 31, 1997). The balance
outstanding under the Agreement at December 31, 1997 was $125,000, which was
repaid in full in the year ended December 31, 1998. Borrowings under the
Agreement were collateralized by substantially all of the Company's assets.
4. COMMITMENTS AND CONTINGENCIES
OPERATING LEASES
The Company leases office space and a phone system under non-cancelable
operating leases, which expire in various years through 2002. Rental expense was
approximately $84,000 and $100,000 for the years ended December 31, 1998 and
1997, respectively. As of December 31, 1998, future minimum rental payments
under the non-cancelable operating leases are as follows:
<TABLE>
<CAPTION>
YEARS ENDING DECEMBER 31,
- -------------------------
<S> <C>
1999....................................................... $145,000
2000....................................................... 138,000
2001....................................................... 138,000
2002....................................................... 16,000
--------
$437,000
========
</TABLE>
LITIGATION
In the normal course of business, the Company is involved in various legal
proceedings. Based upon the information presently available, management believes
that the ultimate resolution of any such proceedings will not have a material
adverse effect on the Company's financial position, liquidity or results of
operations.
5. MEMBERS' INTEREST
Pursuant to terms of the Company's operating agreement, no member is liable
to creditors of the Company, or shall be required to make additional capital
contributions to the Company or to restore all or any portion of a deficit
balance in such member's capital account with the Company. The operating term of
the Company expires in December 2025.
6. RELATED PARTY TRANSACTIONS
The Company had an advance from member of $4,000 and $130,000 as of
December 31, 1998 and 1997, respectively.
The Company subleases office space to another company owned by a member and
charges rent, utilities and phone expenses to the subleasee. Such expenses
charged to the subleasee were $94,000 and
F-32
<PAGE> 107
CERULEAN COLORIZATION, LLC
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
$16,000 for the years ended December 31, 1998 and 1997, respectively, and were
offset against the Company's expenses.
7. SUBSEQUENT EVENT
In August 1999, the Company entered into an agreement with Cerulean FXs,
Inc. pursuant to which Cerulean FXs, Inc. acquired all of the membership
interests of the Company and issued to the Cerulean members (Cerulean Members)
20 percent of the shares of Cerulean FXs, Inc. The shares issued are
exchangeable at the option of the Cerulean members into 701,588 shares of Dynacs
common stock upon the occurrence of certain events or they will automatically
convert upon an effective registration statement filing with the Securities and
Exchange Commission by Dynacs. In addition, the Cerulean Members of the Company
will receive stock options to purchase 196,523 of Dynacs' common stock when the
first stock option is granted under Dynacs' 1999 Long-Term Incentive Plan, and
will also receive stock options to purchase additional 39,305 shares if, within
three years of the date of the agreement, certain performance goals, as defined
in the agreement, are met. After the acquisition, the Company's operations were
absorbed into Dynacs as a part of Dynacs' colorization line of business and the
Company ceased operations as a separate entity.
F-33
<PAGE> 108
PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
The following unaudited pro forma consolidated financial statements (the
"Pro Forma Consolidated Financial Statements") are based on the historical
financial statements of Dynacs Inc. for the nine month period ended September
31, 1999, and as of and for the three month period ended December 31, 1999,
adjusted to give effect to the transactions described below. The Pro Forma
Consolidated Statement of Operations gives effect to the following transactions
as if they had occurred on January 1, 1999: (i) the acquisition of Cerulean
Colorization LLC, (ii) the issuance of the "Bridge Notes" (iii) conversion of
the Bridge Notes and (iv) the use of certain proceeds from the Offering. The Pro
Forma Consolidated Balance Sheet gives effect to the following transactions as
if they had occurred on December 31, 1999: (i) the issuance of the Bridge Notes
and (ii) the use of certain proceeds from the Offering.
The Pro Forma Consolidated Financial Statements do not purport to represent
what Dynacs' results of operations or financial condition would have been had
the events actually occurred on the dates indicated or to predict Dynacs'
results of operations or financial condition in the future. These statements are
qualified in their entirety by, and should be read in conjunction with, the
historical financial statements of Dynacs and the notes thereto included
elsewhere in this Prospectus and "Management's Discussion and Analysis of
Financial Condition and Results of Operations."
The Pro Forma Consolidated Financial Statements give effect only to the
adjustments set forth in the accompanying notes and do not reflect any other
benefits anticipated by management as a result of the Cerulean Colorization LLC
acquisition and the implementation of its business strategy.
F-34
<PAGE> 109
DYNACS INC.
PRO FORMA CONSOLIDATED BALANCE SHEET -- DECEMBER 31, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
TOTAL
PRO FORMA
HISTORICAL ADJUSTMENTS PRO FORMA
----------- ------------ -----------
<S> <C> <C> <C>
CURRENT ASSETS
Cash and cash Equivalents............................... $ 183,397 $ 954,987(a)(d) $ 1,138,384
Accounts receivable..................................... 4,206,661 4,206,661
Unbilled revenue........................................ 734,617 734,617
Prepaid expenses........................................ 311,748 311,748
Deferred tax assets..................................... 602,000 602,000
----------- ------------ -----------
Total current assets............................. 6,038,423 954,987 6,993,410
PROPERTY AND EQUIPMENT, net............................... 3,048,663 2,750,000(b) 5,798,663
FILM LIBRARY AND PRODUCTION COSTS, net.................... 1,057,166 1,057,166
NOTES RECEIVABLE.......................................... 930,700 930,700
DEFERRED TAX ASSET........................................ 704,000 704,000
OTHER ASSETS.............................................. 485,488 240,000(a) 725,488
----------- ------------ -----------
Total assets..................................... $12,264,440 $ 3,944,987 $16,209,427
=========== ============ ===========
CURRENT LIABILITIES
Accounts payable........................................ $ 1,352,894 1,352,894
Accrued expenses........................................ 3,165,616 3,165,616
Line of credit borrowings............................... 2,955,606 (2,955,606)(a)(b)
Current portion of long-term debt....................... 3,031,451 (2,941,187)(a)(b)(d) 90,264
----------- ------------ -----------
Total current liabilities........................ 10,505,567 (5,896,793) 4,608,774
Long-term debt, net of current maturities................. 108,826 (108,826)(b)
MINORITY INTEREST......................................... 393,452 (393,452)(c)
STOCKHOLDERS' EQUITY
Common stock............................................ 53,553 14,221(b)(c) 67,775
Additional paid-in capital.............................. 3,130,201 10,329,837(a)(b)(c) 13,460,037
Note receivable for common stock........................ (1,125,700) (1,125,700)
Accumulated other comprehensive loss.................... 4,396 4,396
Retained earnings....................................... (805,855) (805,855)
----------- ------------ -----------
Total stockholders' equity....................... 1,256,595 10,344,058 11,600,653
----------- ------------ -----------
Total liabilities and stockholders' equity....... $12,264,440 3,944,987 $16,209,427
=========== ============ ===========
</TABLE>
F-35
<PAGE> 110
DYNACS INC.
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999
<TABLE>
<CAPTION>
TOTAL
HISTORICAL PRO FORMA
DYNACS ADJUSTMENTS PRO FORMA
----------- ----------- -----------
<S> <C> <C> <C>
REVENUES:
Information and applied
technology...................... $53,896,828 $ $53,896,828
Media and entertainment............ 1,398,257 1,565,267(a) 2,963,524
----------- ----------- -----------
Total revenues............. 55,295,085 1,565,267 56,860,352
COST OF REVENUES:
Information and applied
technology...................... 51,233,756 51,233,756
Media and entertainment............ 3,063,995 3,063,995*
----------- ----------- -----------
Total cost of revenues..... 54,297,751 54,297,751
GROSS PROFIT......................... 997,334 1,565,267 2,562,601
GENERAL AND ADMINISTRATIVE
EXPENSES........................... 3,444,599 721,328(a)(c) 4,165,927
----------- ----------- -----------
OPERATING INCOME (LOSS).............. (2,447,265) 843,939 (1,603,326)
INTEREST EXPENSE (INCOME), net....... 491,279 2,921,362(a)(b)(c) 3,412,641
LOSS ON EQUITY METHOD INVESTMENT..... 27,867 27,867
----------- ----------- -----------
LOSS BEFORE INCOME TAX............... (2,966,411) (2,077,423) (5,043,834)
INCOME TAX BENEFIT................... 1,360,000 960,164(d) 2,320,164
----------- ----------- -----------
NET (LOSS)........................... $(1,606,411) $(1,117,259) $(2,723,670)
=========== =========== ===========
PRO FORMA NET LOSS, PER COMMON
SHARE -- BASIC..................... (0.38)
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES USED IN COMPUTING PRO FORMA
NET LOSS PER SHARE -- BASIC........ 7,144,920
===========
</TABLE>
F-36
<PAGE> 111
DYNACS INC.
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
TOTAL
PRO FORMA
HISTORICAL ADJUSTMENTS PRO FORMA
----------- ----------- -----------
<S> <C> <C> <C>
REVENUES:
Information and applied technology...... $17,363,517 $ $17,363,517
Media and entertainment................. 266,742 $ 266,742
----------- --------- -----------
Total revenues.................. 17,630,259 17,630,259
COST OF REVENUES:
Information and applied technology...... 15,120,030 $15,120,030
Media and entertainment................. 1,124,644 $ 1,124,644
----------- --------- -----------
Total cost of revenues.......... 16,244,674 16,244,674
GROSS PROFIT.............................. 1,385,585 1,385,585
GENERAL AND ADMINISTRATIVE EXPENSES....... 1,442,538 68,800(a) $ 1,511,338
----------- ---------
OPERATING LOSS............................ (56,953) (68,800) (125,753)
INTEREST EXPENSE, net..................... 188,209 (124,350)(a) $ 63,859
LOSS ON EQUITY METHOD INVESTMENT.......... 33,518 $ 33,518
----------- --------- -----------
LOSS BEFORE INCOME TAX.................... (278,680) (55,550) (223,130)
INCOME TAX BENEFIT........................ 69,000 9,966(b)(c) $ 78,966
NET LOSS.................................. $ (209,680) $ (65,516) $ (144,164)
=========== ========= ===========
PRO FORMA NET LOSS, PER COMMON SHARE
BASIS................................... (0.02)
WEIGHTED AVERAGE NUMBER OF COMMON SHARES
USED IN COMPUTING PRO FORMA NET LOSS PER
SHARE -- BASIC.......................... 7,260,742
===========
</TABLE>
F-37
<PAGE> 112
DYNACS INC. AND SUBSIDIARIES
NOTES TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. GENERAL:
The accompanying pro forma information presents the pro forma financial
position of Dynacs Inc. and subsidiaries (the Company) as of December 31, 1999,
and the pro forma results of operations for the nine-month period ended
September 30, 1999, and the three-month period ended December 31, 1999.
The historical financial statements of the Company were derived from the
historical statements of income for the nine-, and three-month periods ended
September 30, and December 31, 1999. See the Consolidated Financial Statements
and notes thereto for the Company included elsewhere in the Prospectus.
2. ACQUISITION OF CERULEAN COLORIZATION LLC:
During 1999, the Company established Cerulean FXs, Inc., a wholly-owned
subsidiary. On August 13, 1999, Cerulean FXs, Inc. acquired all of the
membership interests in Cerulean Colorization LLC and issued to its members 20
percent of the shares of Cerulean FXs, Inc. (the Cerulean Members). The shares
issued in the exchange were valued at $1,967,262 and are exchangeable at the
option of the Cerulean Members into 701,588 shares of Dynacs common stock, upon
certain events or automatically convert upon the Company's registration
statement being declared effective by the Securities and Exchange Commission
(SEC). The acquisition has been accounted for under the purchased method of
accounting.
3. ADJUSTMENTS TO THE PRO FORMA CONSOLIDATED BALANCE SHEET:
(a) Reflects the issuance of $2,400,000 of the Bridge Loans less $240,000
of issuance costs. The Bridge Loans are net of discounts related to the
detachable warrants ($1,092,000) and the beneficial conversion feature
($1,653,000 related to the entire $2,900,000 of Bridge Loans, $500,000 of which
was outstanding at December 31, 1999) which have been included as an increase in
additional paid-in capital. Reflects the revaluation of $345,000 of Bridge Notes
issued prior to December 31, 1999 into $86,724 of warrants and $258,276 of
beneficial conversion feature upon the completion of this offering.
(b) Reflects the use of a portion of the net proceeds as follows:
<TABLE>
<S> <C>
- Pay down line of credit......................... $2,955,606
- Expand and upgrade U.S. and overseas facilities
and equipment................................... $2,750,000
- Repay certain long-term debt outstanding as of
December 31, 1999............................... $1,500,000
</TABLE>
The issuance of shares related to the above proceeds has been calculated based
on an offering price of $10 per common share resulting in an increase of $9,951
and $7,589,107 in common stock and additional paid-in capital, respectively.
(c) Reflects the issuance of 701,588 shares of common stock to sellers of
the equity interest in Cerulean Colorization, LLC upon closing of this offering
and a reclassification of the $393,452 minority interest into $7,016 of common
stock and $386,436 of additional paid in capital.
F-38
<PAGE> 113
DYNACS INC. AND SUBSIDIARIES
NOTES TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
(d) Reflects the paydown of $1,205,013 of long term debt by the Company
prior to the close of this offering.
4. ADJUSTMENTS TO THE PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE
NINE-MONTHS ENDED SEPTEMBER 30, 1999:
(a) Reflects the inclusion of the operations of Cerulean FX, Inc. from
January 1, 1999 to August 31, 1999, the date of acquisition.
(b) Reflects the increase in interest expense related to the issuance of
the Bridge Loan as of January 1, 1999 to the date of assumed conversion on April
30, 1999, 120 days after issuance. Interest expense includes interest $76,300,
amortization of discount $1,247,000, amortization of beneficial conversion
feature $1,653,000 and amortization of debt issuance cost $290,000.
(c) Reflects the use of a portion of the net proceeds of the offering as
follows:
- ($343,563) resulting from elimination of interest expense related to
the reduction of short-term borrowings and long-term debt.
- $206,300 related to additional depreciation resulting from the
expansion and upgrading of U.S. and overseas facilities and equipment.
(d) For the nine months ended September 30, 1999, reflects the provision
for income taxes as if the Company's subsidiaries were C Corporations during the
period presented.
5. ADJUSTMENTS TO THE PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE
THREE-MONTHS ENDED DECEMBER 31, 1999:
(a) Reflects the use of a portion of the net proceeds of the offering as
follows:
- ($124,350) resulting from elimination of interest expense related to
the reduction of short-term borrowings and long-term debt.
- $68,800 related to additional depreciation resulting from the
expansion and upgrading of U.S. and overseas facilities and equipment.
(b) For the three months ended December 31, 1999, reflects the provision
for income taxes as if the Company's subsidiaries were C Corporations during the
period presented.
6. PRO FORMA SHARES:
The weighted average shares used in computing pro forma net income per
share are as follows:
<TABLE>
<CAPTION>
NINE THREE
MONTHS MONTHS
ENDED ENDED
SEPTEMBER 30, DECEMBER 31,
1999 1999
------------- ------------
<S> <C> <C>
Weighted average outstanding share of common stock....... 5,398,778 5,355,259
Shares of common stock issued to purchase Cerulean....... 701,588 701,588
Conversion of bridge notes into shares of common stock... 325,993 483,334
Common stock issued in the offering...................... 720,561 720,561
--------- ---------
Pro forma, as adjusted shared.......................... 7,144,420 7,260,742
========= =========
</TABLE>
F-39
<PAGE> 114
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NO DEALER, SALESPERSON OR OTHER PERSON IS AUTHORIZED TO GIVE ANY
INFORMATION OR TO REPRESENT ANYTHING NOT CONTAINED IN THIS PROSPECTUS. YOU MUST
NOT RELY ON ANY UNAUTHORIZED INFORMATION OR REPRESENTATIONS. THIS PROSPECTUS IS
AN OFFER TO SELL ONLY THE SHARES OFFERED HEREBY, BUT ONLY UNDER CIRCUMSTANCES
AND IN JURISDICTIONS WHERE IT IS LAWFUL TO DO SO. THE INFORMATION CONTAINED IN
THIS PROSPECTUS IS CURRENT ONLY AS OF ITS DATE.
------------------------
2,500,000 SHARES
DYNACS INC.
COMMON STOCK
------------------------
H. C. WAINWRIGHT & CO., INC.
ROTH CAPITAL PARTNERS, INC.
------------------------
Through and including , 2000 (the 25th day after the date of
this prospectus), all dealers effecting transactions in these securities,
whether or not participating in this offering, may be required to deliver a
prospectus. This is in addition to a dealer's obligation to deliver a prospectus
when acting as an underwriter and with respect to an unsold allotment or
subscription.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 115
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Estimated expenses (other than underwriting discounts and fees) payable in
connection with the sale of the Common Stock offered hereby are as follows:
<TABLE>
<S> <C>
SEC registration fee........................................ $ 9,221
NASD filing fee............................................. 3,993
Nasdaq National Market listing fee.......................... 25,000
Printing and engraving expenses............................. 175,000
Legal fees and expenses..................................... 200,000
Accounting fees and expenses................................ 250,000
Blue Sky fees and expenses (including legal fees)........... 10,000
Transfer agent and registrar fees and expenses.............. 5,000
Miscellaneous............................................... 71,786
TOTAL............................................. 750,000
========
</TABLE>
Dynacs will bear all expenses shown above.
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Delaware General Corporation Law and Dynacs' charter and by-laws
provide for indemnification of Dynacs' directors and officers for liabilities
and expenses that they may incur in such capacities. In general, directors and
officers are indemnified with respect to actions taken in good faith in a manner
reasonably believed to be in, or not opposed to, the best interests of Dynacs
and, with respect to any criminal action or proceeding, actions that the
indemnitee had no reasonable cause to believe were unlawful. Reference is made
to Dynacs' charter and by-laws filed as Exhibits 3.1 and 3.2 hereto,
respectively.
The Underwriting Agreement provides that the underwriters are obligated,
under some circumstances, to indemnify directors, officers and controlling
persons of Dynacs against some liabilities, including liabilities under the
Securities Act of 1933, as amended (the "Securities Act"). Reference is made to
the form of Underwriting Agreement filed as Exhibit 1.1 hereto.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.
In the three fiscal years preceding the filing of this registration
statement, Dynacs has issued the following securities that were not registered
under the Securities Act of 1933, as amended (the "Act"):
- On January 25, 1999, Dynacs issued options for the purchase of 353,742
shares of common stock to Ravi Venugopal which Mr. Venugopal immediately
exercised for the aggregate consideration of $1,127,700. Of this amount,
Mr. Venugopal paid $2,000 in cash and the balance of $1,125,700 by
issuing to Dynacs a promissory note which is also secured by a pledge of
these shares. This note bears interest at the prime rate per annum and
matures on January 1, 2001.
<PAGE> 116
- In August 1999 (A) Dynacs issued to Ramesh Venugopal, a brother of Ravi
Venugopal, who is a senior Vice President and the Secretary of Dynacs, an
aggregate of 88,435 shares of Dynacs' common stock as compensation for
Mr. Venugopal's services in setting up the new Dynacs Digital Media
Products facility in Batam, Indonesia and for the management of such
facility through December 31, 1999. Those shares were issued pursuant to
Section 4(2) of the Act.
- In August 1999, in connection with our acquisition of Cerulean FXs, Inc.,
we agreed to issue, upon the consummation of this offering, an aggregate
of 701,588 shares of our common stock upon the automatic conversion of
certain parties' equity interest in our subsidiary, Cerulean FXs, Inc.
and options to purchase an aggregate of 235,828 shares of our common
stock under our 1999 Long-Term Incentive Plan. In addition, Michael
Burns, a director-nominee, has the right to receive options to purchase
39,305 shares of common stock under the plan in the event we obtain
contracts for colorization services in an aggregate amount of $10.0
million no later than August 12, 2002. These options and shares were
issued pursuant to Rule 701 under the Securities Act because Dynacs was
not reporting Company under the Exchange Securities Act of 1934 at the
time of grant, and the grant was to employees pursuant to a compensatory
plan.
- In order to finance its working capital deficits during the period
November 1999 through March 2000, the Company issued an aggregate of
$2,900,000 in principal amount of Bridge Notes. Each Bridge Note was in
the face amount of $100,000 and each investor received five year warrants
to purchase 16,845 shares of our common stock for each $100,000 principal
amount of Bridge Notes purchased. $1,000,000 principal amount of Bridge
Notes were sold in "Bridge I" during November 1999 and January 2000, and
warrants to purchase 168,450 shares of common stock were issued.
$1,900,000 aggregate principal amount of Bridge Notes were sold in
"Bridge II" during February and March 2000 and warrants to purchase
320,050 shares of common stock were issued in connection with Bridge II
(collectively, the "Bridge Warrants"). In addition, in connection with
the Bridge Financings, warrants to purchase an aggregate of 48,334 shares
of common stock were issued to H.C. Wainwright & Co., Inc. in
consideration for services rendered as placement agent. The Bridge Notes,
the Bridge Warrants and the warrants issued to Wainwright were issued
pursuant to Section 4(2) of the Act.
- No underwriters were involved in the foregoing sales of securities. Such
sales were made in reliance upon an exemption from the registration
provisions of the Securities Act set forth in Section 4(2) thereof
relative to sales by an issuer not involving any public offering or the
rules and regulations thereunder, or, in the case of options to purchase
Common Stock, Rule 701 under the Securities Act. All of the foregoing
securities are deemed restricted securities for purposes of the
Securities Act.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) Exhibits:
<TABLE>
<CAPTION>
EXHIBIT
NO. EXHIBIT
- ------- -------
<C> <S>
1.1 Form of Underwriting Agreement.
3.1 Restated Certificate of Incorporation.
3.4 By-laws.*
4.1 Form of Registrant's common stock certificate.
</TABLE>
<PAGE> 117
<TABLE>
<CAPTION>
EXHIBIT
NO. EXHIBIT
- ------- -------
<C> <S>
4.2 Description of Capital Stock (contained in the Certificate
of Incorporation filed as Exhibit 3.1).
4.3 Form of Representatives' Warrants, including form of warrant
certificate.
5.1 Opinion of Frankfurt, Garbus, Klein & Selz, P.C., counsel to
the Registrant.*
10.1 1999 Long Term Incentive Plan of the Registrant.*
10.2 Contract with The Boeing Company under Purchase Order No.
HX3259 effective as of September 22, 1994, as amended.
10.3 Contract with NASA under Contract No. NAS10-98001 effective
as of October 1, 1997, as amended.+
10.4 Contract with NASA under Contract No. NAS3-98008 effective
as of June 1, 1998, as amended.+
10.5 Form of Employment Agreement between the Registrant and
Ramendra Singh.*
10.6 Form of Employment Agreement between the Registrant and Ravi
Venugopal.*
10.7 Form of Employment Agreement between the Registrant and
Harry W. Schubele III.*
10.8 Form of Employment Agreement between the Registrant and
Jayant Ramakrishnan.*
10.9 Form of Employment Agreement between the Registrant and
Javier E. Benavente.*
10.10 Form of Employment Agreement between the Registrant and
Robert Rodriguez.*
10.11 Warrant and Senior Subordinated Convertible Note Purchase
Agreement dated as of November 4, 1999 among the Registrant
and the Investors identified therein (including form of Note
and Warrant).
10.12 Second Warrant and Senior Subordinated Convertible Note
Purchase Agreement dated as of March 15, 2000 among the
Registrant and the Investors identified therein (including
form of Note and Warrant).
10.13 Shareholder Agreement dated as of August 13, 1999 among the
Registrant, current shareholders of Registrant and former
owners of Cerulean Colorization, L.L.C.
10.14 Registration Rights Agreement dated August 13, 1999 among
the Registrant, current shareholders of Registrant and
former owners of Cerulean Colorization, L.L.C.
10.15 Exchange Agreement dated August 13, 1999 among former owners
of Cerulean and Registrant.
10.16 Contribution and Exchange Agreement dated as of August 12,
1999 among Registrant, Cerulean FXs, Inc., and former owners
of Cerulean FXs, Inc.
10.17 Demand Promissory Note and Loan Agreement dated February 20,
1999 between First National Bank of Florida and Registrant
for $4,000,000.*
10.18 Lease Agreement dated as of October 23, 1998 between
TechPark Limited Partnership and the Registrant.
10.19 Lease Agreement dated as of January 1, 1999 between the
Registrant and Dynacs Properties, Inc.
10.20 Factory Lease Agreement between PT Batamindo Investment
Corporation and Dynacs Digital Studios PTE Ltd. dated
November 3, 1998.
10.21 Promissory note, dated October 6, 1997, payable by the
Registrant to Venugopal Srnivasan and Ranjini Srinivasan for
the principal amount of $200,000.
</TABLE>
<PAGE> 118
<TABLE>
<CAPTION>
EXHIBIT
NO. EXHIBIT
- ------- -------
<C> <S>
10.22 Promissory note, dated February 15, 1999, payable by the
Registrant to Venugopal Srinivasan for the principal amount
of $110,000.
10.23 Promissory note, dated March 30, 1999, payable by the
Registrant to Ramendra P. Singh for the principal amount of
$160,000.
10.24 Promissory note, dated June 10, 1999, payable by the
Registrant to Peter Likins for the principal amount of
$400,000, and extension thereof.*
10.25 Promissory note, dated June 10, 1999, payable by the
Registrant to Robert Skelton for the principal amount of
$200,000 and extension thereof.
10.26 Promissory note, dated February 23, 1999, payable by the
Registrant to Ravi Venugopal for the principal amount of
$248,000.
10.27 Promissory note, dated August 23, 1999, payable by the
Registrant to April Singh for the principal amount of
$89,301.
21.1 Subsidiaries of the Registrant.
23.1 Consent of Arthur Andersen LLP
23.2 Consent of Hoyman, Dobson & Company P.A.
23.3 Consent of Frankfurt, Garbus, Klein & Selz, P.C. (included
in Exhibit 5.1).*
24.1 Power of Attorney (included in the signature page to the
registration statement).
27.1 Financial Data Schedule.
27.2 Financial Data Schedule
99.1 Consent of Michael G. Bolton, as Director-Nominee.
99.2 Consent of Michael R. Burns, as Director-Nominee.
99.3 Consent of Peter Likins, as Director-Nominee.
99.4 Consent of Robert E. Skelton, as Director-Nominee
</TABLE>
- -------------------------
* To be filed by amendment.
+ Confidential information omitted and filed separately with the Commission.
(b) Financial Statement Schedules.
Schedule II -- Valuation and Qualifying Accounts
All other schedules for which provision is made in the applicable
accounting regulations of the Securities and Exchange Commission are not
required under the related instructions or are inapplicable, and therefore have
been omitted.
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which it offers or sales are being
made, a post-effective amendment to this registration statement to:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act");
<PAGE> 119
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b), if, in the aggregate, the
changes in volume and price represent no more than 20 percent change in
the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement;
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned registrant hereby undertakes to provide to the underwriter
at the closing specified in the underwriting agreements, certificates in such
denominations and registered in such names as required by the underwriter to
permit prompt delivery to each purchaser.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described in Item 14 above, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the registrant will, unless
in the opinion of its counselor the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
The undersigned registrant hereby undertakes (1) to provide to the
underwriters at the closing specified in the underwriting agreement,
certificates in such denominations and registered in such names as required by
the underwriters to permit prompt delivery to each purchaser; (2) that for
purposes of determining any liability under the Securities Act, the information
omitted from the form of prospectus filed as part of this registration statement
in reliance upon Rule 430A and contained in a form of prospectus filed by the
registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act
shall be deemed to be part of this registration statement as of the time it was
declared effective; and (3) that for the purpose of determining any liability
under the Securities Act, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
<PAGE> 120
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in Palm Harbor, Florida,
on March 29, 2000.
DYNACS INC.
By: /s/ RAMENDRA P. SINGH
------------------------------------
Ramendra P. Singh
Chief Executive Officer,
President and Director
SIGNATURES
Each individual whose signature appears below hereby constitutes and
appoints Robert Rodriguez as his true and lawful attorney-in-fact and agent,
with full power of substitution and resubstitution, for such person and in such
person's name, place and stead, in any and all capacities, to sign any and all
amendments (including pre-effective and post-effective amendments) to this
registration statement and to sign any registration statement (and any
post-effective amendments) relating to the same offering as this registration
statement that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, and to file the same with the Securities and Exchange
Commission, with all exhibits thereto and other documents in connection
therewith, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intent and purposes as such person might or could do in person, hereby ratifying
and confirming all that said attorney-in-fact and agent or either of them or any
substitute therefor, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE(S) DATE
--------- -------- ----
<S> <C> <C>
/s/ RAMENDRA P. SINGH Chief Executive Officer, President and March 29, 2000
- ------------------------------------------ Director (Principal Executive Officer)
Ramendra P. Singh
/s/ ROBERT RODRIGUEZ Chief Financial Officer (Principal March 29, 2000
- ------------------------------------------ Financial and Accounting Officer)
Robert Rodriguez
</TABLE>
<PAGE> 121
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NO. EXHIBIT
- ------- -------
<C> <S>
1.1 Form of Underwriting Agreement.
3.1 Restated Certificate of Incorporation.
3.4 By-laws.*
4.1 Form of Registrant's common stock certificate.
4.2 Description of Capital Stock (contained in the Certificate
of Incorporation filed as Exhibit 3.1).
4.3 Form of Representatives' Warrants, including form of warrant
certificate.
5.1 Opinion of Frankfurt, Garbus, Klein & Selz, P.C., counsel to
the Registrant.*
10.1 1999 Long Term Incentive Plan of the Registrant.*
10.2 Contract with The Boeing Company under Purchase Order No.
HX3259 effective as of September 22, 1994, as amended.
10.3 Contract with NASA under Contract No. NAS10-98001 effective
as of October 1, 1997, as amended.+
10.4 Contract with NASA under Contract No. NAS3-98008 effective
as of June 1, 1998, as amended.+
10.5 Form of Employment Agreement between the Registrant and
Ramendra Singh.*
10.6 Form of Employment Agreement between the Registrant and Ravi
Venugopal.*
10.7 Form of Employment Agreement between the Registrant and
Harry W. Schubele III.*
10.8 Form of Employment Agreement between the Registrant and
Jayant Ramakrishnan.*
10.9 Form of Employment Agreement between the Registrant and
Javier E. Benavente.*
10.10 Form of Employment Agreement between the Registrant and
Robert Rodriguez.*
10.11 Warrant and Senior Subordinated Convertible Note Purchase
Agreement dated as of November 4, 1999 among the Registrant
and the Investors identified therein (including form of Note
and Warrant).
10.12 Second Warrant and Senior Subordinated Convertible Note
Purchase Agreement dated as of March 15, 2000 among the
Registrant and the Investors identified therein (including
form of Note and Warrant).
10.13 Shareholder Agreement dated as of August 13, 1999 among the
Registrant, current shareholders of Registrant and former
owners of Cerulean Colorization, L.L.C.
10.14 Registration Rights Agreement dated August 13, 1999 among
the Registrant, current shareholders of Registrant and
former owners of Cerulean Colorization, L.L.C.
10.15 Exchange Agreement dated August 13, 1999 among former owners
of Cerulean and Registrant.
10.16 Contribution and Exchange Agreement dated as of August 12,
1999 among Registrant, Cerulean FXs, Inc., and former owners
of Cerulean FXs, Inc.
10.17 Demand Promissory Note and Loan Agreement dated February 20,
1999 between First National Bank of Florida and Registrant
for $4,000,000.*
10.18 Lease Agreement dated as of October 23, 1998 between
TechPark Limited Partnership and the Registrant.
10.19 Lease Agreement dated as of January 1, 1999 between the
Registrant and Dynacs Properties, Inc.
</TABLE>
<PAGE> 122
<TABLE>
<CAPTION>
EXHIBIT
NO. EXHIBIT
- ------- -------
<C> <S>
10.20 Factory Lease Agreement between PT Batamindo Investment
Corporation and Dynacs Digital Studios PTE Ltd. dated
November 3, 1998.
10.21 Promissory note, dated October 6, 1997, payable by the
Registrant to Venugopal Srinivasan and Ranjini Srinivasan
for the principal amount of $200,000.
10.22 Promissory note, dated February 15, 1999, payable by the
Registrant to Venugopal Srinivasan for the principal amount
of $110,000, and extension thereof.
10.23 Promissory note, dated March 30, 1999, payable by the
Registrant to Ramendra P. Singh for the principal amount of
$160,000, and extension thereof.
10.24 Promissory note, dated June 10, 1999, payable by the
Registrant to Peter Likins for the principal amount of
$400,000.
10.25 Promissory note, dated June 10, 1999, payable by the
Registrant to Robert Skelton for the principal amount of
$200,000.
10.26 Promissory note, dated February 23, 1999, payable by the
Registrant to Ravi Venugopal for the principal amount of
$248,000 and extension thereof.
10.27 Promissory note, dated August 23, 1999, payable by the
Registrant to Anil Singh for the principal amount of $89,301
and extension thereof.
21.1 Subsidiaries of the Registrant.
23.1 Consent of Arthur Andersen LLP
23.2 Consent of Hoyman, Dobson & Company P.A.
23.3 Consent of Frankfurt, Garbus, Klein & Selz, P.C. (included
in Exhibit 5.1).*
24.1 Power of Attorney (included in the signature page to the
registration statement).
27.1 Financial Data Schedule.
27.2 Financial Data Schedule
99.1 Consent of Michael G. Bolton, as Director-Nominee.
99.2 Consent of Michael R. Burns, as Director-Nominee.
99.3 Consent of Peter Likins, as Director-Nominee.
99.4 Consent of Robert E. Skelton, as Director-Nominee
</TABLE>
- -------------------------
* To be filed by amendment.
+ Confidential information omitted and filed separately with the Commission.
<PAGE> 1
Exhibit 1.1
[FORM OF UNDERWRITING AGREEMENT]
[SUBJECT TO ADDITIONAL REVIEW]
2,500,000 Shares of Common Stock
Dynacs Inc.
UNDERWRITING AGREEMENT
New York, New York
____________, 2000
H.C. Wainwright & Co., Inc.
Roth Capital Partners, Inc.
As Representatives of the Several
Underwriters listed on Schedule A hereto
c/o H.C. Wainwright & Co., Inc.
One Boston Place, 40th Floor
Boston, Massachusetts 02108
Ladies and Gentlemen:
Dynacs Inc., a Delaware corporation (the "Company"), confirms its
agreement with H.C. Wainwright & Co., Inc. ("Wainwright"), Roth Capital
Partners, Inc. ("Roth") and each of the underwriters named in Schedule A hereto
(collectively, the "Underwriters," which term shall also include any underwriter
substituted as hereinafter provided in Section 11), for whom Wainwright and Roth
are acting as representatives (the "Representatives"), with respect to the sale
by the Company and the purchase by the Underwriters, acting severally and not
jointly, of the respective numbers of shares of the Company's common stock,
$0.01 par value per share ("Common Stock"), set forth in Schedule A hereto. Such
shares of Common Stock are hereinafter referred to as the "Firm Shares."
Upon your request, as provided in Section 2(b) of this Agreement, the
Company shall also sell to the Underwriters, acting severally and not jointly,
up to an additional 375,000 shares of Common Stock for the purpose of covering
over-allotments, if any (the "Option Shares"). The Firm Shares and the Option
Shares are sometimes hereinafter referred to as the "Shares." The Company also
proposes to issue and sell to the Representatives warrants (the
"Representatives' Warrants") pursuant to the Representatives' Warrant Agreement
(the "Representatives' Warrant Agreement") for the purchase of an additional
250,000 shares of Common Stock. The shares of Common Stock issuable upon
exercise of the Representatives'
<PAGE> 2
Warrants are hereinafter referred to as the "Representatives' Shares." The Firm
Shares, the Option Shares, the Representatives' Warrants and the
Representatives' Shares (collectively, hereinafter referred to as the
"Securities") are more fully described in the Registration Statement and the
Prospectus referred to below.
1. Representations and Warranties of the Company. The Company represents
and warrants to, and agrees with, each of the Underwriters as of the date
hereof, and as of the Closing Date (hereinafter defined) and the Option Closing
Date (hereinafter defined), if any, as follows:
(a) The Company has prepared and filed with the Securities and
Exchange Commission (the "Commission") a registration statement, and an
amendment or amendments thereto, on Form S-1 (No. 333-______), including any
related preliminary prospectus ("Preliminary Prospectus"), for the registration
of the Firm Shares and the Option Shares under the Securities Act of 1933, as
amended (the "Act"), which registration statement and amendment or amendments
have been prepared by the Company in conformity with the requirements of the
Act, and the rules and regulations (the "Regulations") of the Commission under
the Act. The Company will promptly file a further amendment to said registration
statement in the form heretofore delivered to the Underwriters, and will not
file any other amendment thereto to which the Underwriters shall have objected
in writing after having been furnished with a copy thereof. Except as the
context may otherwise require, such registration statement, as amended, on file
with the Commission at the time the registration statement becomes effective
(including the prospectus, financial statements, schedules, exhibits and all
other documents filed as a part thereof or incorporated therein (including, but
not limited to those documents or information incorporated by reference therein)
and all information deemed to be a part thereof as of such time pursuant to
paragraph (b) of Rule 430(A) of the Regulations)), is hereinafter called the
"Registration Statement", and the form of prospectus in the form first filed
with the Commission pursuant to Rule 424(b) of the Regulations, is hereinafter
called the "Prospectus." For purposes hereof, "Rules and Regulations" mean the
rules and regulations adopted by the Commission under either the Act or the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), as applicable.
(b) Neither the Commission nor any state regulatory authority has
issued any order preventing or suspending the use of any Preliminary Prospectus,
the Registration Statement or the Prospectus or any part of any thereof and no
proceedings for a stop order suspending the effectiveness of the Registration
Statement or any of the Company's securities have been instituted or are pending
or to the Company's knowledge, threatened. Each of the Preliminary Prospectus,
Registration Statement and Prospectus at the time of filing thereof conformed
with the requirements of the Act and the Rules and Regulations, and none of the
Preliminary Prospectus, Registration Statement or Prospectus at the time of
filing thereof contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein and necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, provided, however, that this representation and warranty does
not apply to statements made or statements omitted in reliance upon and in
conformity with written information furnished to the Company with respect to the
Underwriters by or on behalf of the Underwriters expressly for use in such
Preliminary Prospectus, Registration Statement or Prospectus.
2
<PAGE> 3
(c) When the Registration Statement becomes effective and at all
times subsequent thereto up to the Closing Date and each Option Closing Date, if
any, and during such longer period as the Prospectus may be required to be
delivered in connection with sales by the Underwriters or a dealer, the
Registration Statement and the Prospectus will contain all statements which are
required to be stated therein in accordance with the Act and the Rules and
Regulations, and will conform to the requirements of the Act and the Rules and
Regulations; neither the Registration Statement nor the Prospectus, nor any
amendment or supplement thereto, will contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, provided, however, that this
representation and warranty does not apply to statements made or statements
omitted in reliance upon and in conformity with information furnished to the
Company in writing by or on behalf of any Underwriter expressly for use in the
Preliminary Prospectus, Registration Statement or Prospectus or any amendment
thereof or supplement thereto.
(d) The Company has been duly organized and is validly existing as a
corporation in good standing under the laws of the state of its incorporation.
The Company does not own an interest in any corporation, partnership, trust,
joint venture or other business entity. The Company is duly qualified and
licensed and in good standing as a foreign corporation in each jurisdiction in
which its ownership or leasing of any properties or the character of its
operations requires such qualification or licensing. The Company has all
requisite corporate power and authority, and the Company has obtained any and
all necessary authorizations, approvals, orders, licenses, certificates,
franchises and permits of and from all governmental or regulatory officials and
bodies (including, without limitation, those having jurisdiction over
environmental or similar matters), to own or lease its properties and conduct
its business as described in the Prospectus; the Company is and has been doing
business in compliance with all such authorizations, approvals, orders,
licenses, certificates, franchises and permits and all federal, state and local
laws, rules and regulations; the Company has not received any notice of
proceedings relating to the revocation or modification of any such
authorization, approval, order, license, certificate, franchise, or permit
which, singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would materially and adversely affect the condition,
financial or otherwise, or the earnings, position, prospects, value, operation,
properties, business or results of operations of the Company. The disclosures in
the Registration Statement concerning the effects of federal, state and local
laws, rules and regulations on the Company's business as currently conducted and
as contemplated are correct in all material respects and do not omit to state a
material fact necessary to make the statements contained therein not misleading
in light of the circumstances in which they were made.
(e) The Company has a duly authorized, issued and outstanding
capitalization as set forth in the Prospectus, under "Capitalization" and
"Description of Capital Stock" and will have the adjusted capitalization set
forth therein on the Closing Date and the Option Closing Date, if any, based
upon the assumptions set forth therein, and the Company is not a party to or
bound by any instrument, agreement or other arrangement providing for it to
issue any capital stock, rights, warrants, options or other securities, except
for this Agreement, the Representatives' Warrant Agreement and as described in
the Prospectus. The Securities and all other securities issued or issuable by
the Company conform or, when issued and paid for, will conform, in all respects
to all statements with respect thereto contained in the Registration
3
<PAGE> 4
Statement and the Prospectus. All issued and outstanding securities of the
Company have been duly authorized and validly issued and are fully paid and
non-assessable and the holders thereof have no rights of rescission with respect
thereto, and are not subject to personal liability by reason of being such
holders; and none of such securities were issued in violation of the preemptive
rights of any holders of any security of the Company or similar contractual
rights granted by the Company. The Securities are not and will not be subject to
any preemptive or other similar rights of any stockholder, have been duly
authorized and, when issued, paid for and delivered in accordance with the terms
hereof, will be validly issued, fully paid and non-assessable and will conform
to the description thereof contained in the Prospectus; the holders thereof will
not be subject to any liability solely by reason of being such holders; all
corporate action required to be taken for the authorization, issue and sale of
the Securities has been duly and validly taken; and the certificates
representing the Securities will be in due and proper form. Upon the issuance
and delivery pursuant to the terms hereof of the Securities to be sold by the
Company hereunder, the Underwriters or the Representatives, as the case may be,
will acquire good and marketable title to such Securities free and clear of any
lien, charge, claim, encumbrance, pledge, security interest, defect or other
restriction or equity of any kind whatsoever.
(f) The financial statements, including the related notes and
schedules thereto, included in the Registration Statement, each Preliminary
Prospectus and the Prospectus fairly present the financial position, income,
changes in cash flow, changes in stockholders' equity, and the results of
operations of the Company at the respective dates and for the respective periods
to which they apply and the pro forma financial information included in the
Registration Statement and Prospectus presents fairly, on a basis consistent
with that of the audited financial statements included therein, what the
Company's pro forma capitalization would have been for the respective periods
and as of the respective dates to which they apply after giving effect to the
adjustments described therein. Such financial statements have been prepared in
conformity with generally accepted accounting principles and the Rules and
Regulations, consistently applied throughout the periods involved. There has
been no adverse change or development involving a material prospective change in
the condition, financial or otherwise, or in the earnings, position, prospects,
value, operation, properties, business, or results of operations of the Company
whether or not arising in the ordinary course of business, since the date of the
financial statements included in the Registration Statement and the Prospectus,
and the outstanding debt, the property, both tangible and intangible, and the
business of the Company conform in all material respects to the descriptions
thereof contained in the Registration Statement and the Prospectus. Financial
information set forth in the Prospectus under the headings "Summary Financial
Data," "Selected Financial Data," "Capitalization," and "Management's Discussion
and Analysis of Financial Condition and Results of Operations," fairly present,
on the basis stated in the Prospectus, the information set forth therein, have
been derived from or compiled on a basis consistent with that of the audited
financial statements included in the Prospectus.
(g) The Company (i) has paid all federal, state, local, and foreign
taxes for which it is liable and for which payment is due, including, but not
limited to, withholding taxes and amounts payable under Chapters 21 through 24
of the Internal Revenue Code of 1986 (the "Code"), and has furnished all
information returns it is required to furnish pursuant to the Code, (ii) has
established adequate reserves for such taxes which are not due and payable, and
(iii) does not have any tax deficiency or claims outstanding, proposed or
assessed against it.
4
<PAGE> 5
(h) No transfer tax, stamp duty or other similar tax is payable by
or on behalf of the Underwriters in connection with (i) the issuance by the
Company of the Securities, (ii) the purchase by the Underwriters of the
Securities to be sold by the Company hereunder and the purchase by the
Representatives of the Representatives' Warrants from the Company, (iii) the
consummation by the Company of any of its obligations under this Agreement or
the Representatives' Warrant Agreement, or (iv) resales of the Shares in
connection with the distribution contemplated hereby.
(i) The Company maintains insurance policies, including, but not
limited to, general liability, product liability and property insurance, which
insures the Company and its employees, against such losses and risks generally
insured against by comparable businesses. The Company (A) has not failed to give
notice or present any insurance claim with respect to any matter, including but
not limited to the Company's business, property or employees, under the
insurance policy or surety bond in a due and timely manner, (B) does not have
any disputes or claims against any underwriter of such insurance policies or
surety bonds or has not failed to pay any premiums due and payable thereunder,
or (C) has not failed to comply with all conditions contained in such insurance
policies and surety bonds. There are no facts or circumstances under any such
insurance policy or surety bond which would relieve any insurer of its
obligation to satisfy in full any valid claim of the Company.
(j) There is no action, suit, proceeding, inquiry, arbitration,
investigation, litigation or governmental proceeding (including, without
limitation, those involving environmental or similar matters), domestic or
foreign, pending or threatened against (or circumstances that may give rise to
the same), or involving the properties or business of, the Company which (i)
questions the validity of the capital stock of the Company, this Agreement or
the Representatives' Warrant Agreement or of any action taken or to be taken by
the Company pursuant to or in connection with this Agreement or the
Representatives' Warrant Agreement, (ii) is required to be disclosed in the
Registration Statement which is not so disclosed (and such proceedings as are
summarized in the Registration Statement are accurately summarized in all
material respects), or (iii) might materially and adversely affect the
condition, financial or otherwise, or the earnings, position, prospects,
stockholders' equity, value, operation, properties, business or results of
operations of the Company.
(k) The Company has full legal right, corporate power and authority
to authorize, issue, deliver and sell the Securities, enter into this Agreement
and the Representatives' Warrant Agreement and to consummate the transactions
provided for in such agreements; and this Agreement and the Representatives'
Warrant Agreement have each been duly and properly authorized, executed and
delivered by the Company. Each of this Agreement and the Representatives'
Warrant Agreement constitutes a legal, valid and binding agreement of the
Company enforceable against the Company in accordance with its terms, except (i)
as such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or similar laws affecting
creditors' rights generally, (ii) as enforceability of any indemnification or
contribution provisions may be limited under applicable laws or the public
policies underlying such laws and (iii) that the remedies of specific
performance and injunctive and other forms of equitable relief may be subject to
equitable defenses and to the discretion of the court before which any
proceedings may be brought. None of the Company's issue and sale of the
Securities, execution or delivery of this Agreement or the Representatives'
5
<PAGE> 6
Warrant Agreement, its performance hereunder and thereunder, its consummation of
the transactions contemplated herein and therein, or the conduct of its business
as described in the Registration Statement, the Prospectus, and any amendments
or supplements thereto, conflicts with or will conflict with or results or will
result in any breach or violation of any of the terms or provisions of, or
constitutes or will constitute a default under, or result in the creation or
imposition of any lien, charge, claim, encumbrance, pledge, security interest,
defect or other restriction or equity of any kind whatsoever upon, any property
or assets (tangible or intangible) of the Company pursuant to the terms of, (i)
the articles of incorporation or by-laws of the Company, (ii) any license,
contract, indenture, mortgage, deed of trust, voting trust agreement,
stockholders agreement, note, loan or credit agreement or any other agreement or
instrument to which the Company is a party or by which it is or may be bound or
to which any of its properties or assets (tangible or intangible) is or may be
subject, or any indebtedness, or (iii) any statute, judgment, decree, order,
rule or regulation applicable to the Company of any arbitrator, court,
regulatory body or administrative agency or other governmental agency or body
(including, without limitation, those having jurisdiction over environmental or
similar matters), domestic or foreign, having jurisdiction over the Company or
any of its activities or properties.
(l) Except as described in the Prospectus, no consent, approval,
authorization or order of, and no filing with, any court, regulatory body,
government agency or other body, domestic or foreign, is required for the
issuance of the Shares pursuant to the Prospectus and the Registration
Statement, the issuance of the Representatives' Warrants, the performance of
this Agreement and the Representatives' Warrant Agreement and the transactions
contemplated hereby and thereby, including without limitation, any waiver of any
preemptive, first refusal or other rights that any entity or person may have for
the issue and/or sale of any of the Shares or the Representatives' Warrants,
except such as have been or may be obtained under the Act or may be required
under state securities or Blue Sky laws in connection with the Underwriters'
purchase and distribution of the Shares, and the Representatives' Warrants to be
sold by the Company hereunder and under the Representatives' Warrant Agreement.
(m) All executed agreements, contracts or other documents or copies
of executed agreements, contracts or other documents filed as exhibits to the
Registration Statement to which the Company is a party or by which it may be
bound or to which any of its assets, properties or business may be subject have
been duly and validly authorized, executed and delivered by the Company, and
constitute the legal, valid and binding agreements of the Company, enforceable
against the Company, in accordance with their respective terms. The descriptions
in the Registration Statement of agreements, contracts and other documents are
accurate in all material respects and fairly present the information required to
be shown with respect thereto on Form S-1, and there are no contracts or other
documents which are required by the Act to be described in the Registration
Statement or filed as exhibits to the Registration Statement which are not
described or filed as required, and the exhibits which have been filed are in
all material respects complete and correct copies of the documents of which they
purport to be copies.
(n) Subsequent to the respective dates as of which information is
set forth in the Registration Statement and Prospectus, and except as may
otherwise be indicated or contemplated herein or therein, the Company has not
(i) issued any securities or incurred any liability or obligation, direct or
contingent, for borrowed money, (ii) entered into any transaction other than in
the ordinary course of business, or (iii) declared or paid any dividend or made
any
6
<PAGE> 7
other distribution on or in respect of its capital stock of any class, and there
has not been any change in the capital stock, or any material change in the debt
(long or short term) or liabilities or material adverse change in or affecting
the general affairs, management, financial operations, stockholders' equity or
results of operations of the Company.
(o) No default exists in the due performance and observance of any
term, covenant or condition of any license, contract, indenture, mortgage,
installment sale agreement, lease, deed of trust, voting trust agreement,
stockholders agreement, partnership agreement, note, loan or credit agreement,
purchase order, or any other agreement or instrument evidencing an obligation
for borrowed money, or any other material agreement or instrument to which the
Company is a party or by which the Company may be bound or to which the property
or assets (tangible or intangible) of the Company is subject or affected.
(p) The Company has generally enjoyed a satisfactory
employer-employee relationship with its employees and is in compliance with all
federal, state, local, and foreign laws and regulations respecting employment
and employment practices, terms and conditions of employment and wages and
hours. There are no pending investigations involving the Company by the U.S.
Department of Labor, or any other governmental agency responsible for the
enforcement of such federal, state, local, or foreign laws and regulations.
There is no unfair labor practice charge or complaint against the Company
pending before the National Labor Relations Board or any strike, picketing,
boycott, dispute, slowdown or stoppage pending or threatened against or
involving the Company or any predecessor entity, and none has ever occurred. No
representation question exists respecting the employees of the Company, and no
collective bargaining agreement or modification thereof is currently being
negotiated by the Company. No grievance or arbitration proceeding is pending
under any expired or existing collective bargaining agreements of the Company.
No labor dispute with the employees of the Company exists, or, is imminent.
(q) Except as described in the Prospectus, the Company does not
maintain, sponsor or contribute to any program or arrangement that is an
"employee pension benefit plan," an "employee welfare benefit plan," or a
"multiemployer plan" as such terms are defined in Sections 3(2), 3(1) and 3(37),
respectively, of the Employee Retirement Income Security Act of 1974, as amended
("ERISA") ("ERISA Plans"). The Company does not maintain or contribute, now or
at any time previously, to a defined benefit plan, as defined in Section 3(35)
of ERISA. No ERISA Plan (or any trust created thereunder) has engaged in a
"prohibited transaction" within the meaning of Section 406 of ERISA or Section
4975 of the Code, which could subject the Company to any tax penalty on
prohibited transactions and which has not adequately been corrected. Each ERISA
Plan is in compliance with all reporting, disclosure and other requirements of
the Code and ERISA as they relate to any such ERISA Plan. Determination letters
have been received from the Internal Revenue Service with respect to each ERISA
Plan which is intended to comply with Code Section 401(a), stating that such
ERISA Plan and the attendant trust are qualified thereunder. The Company has
never completely or partially withdrawn from a "multiemployer plan."
(r) Neither the Company nor any of its employees, directors,
stockholders, partners, or affiliates (within the meaning of the Rules and
Regulations) of any of the foregoing has taken or will take, directly or
indirectly, any action designed to or which has constituted or
7
<PAGE> 8
which might be expected to cause or result in, under the Exchange Act, or
otherwise, stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities or otherwise.
(s) Except as otherwise disclosed in the Prospectus, none of the
patents, patent applications, trademarks, service marks, service names, trade
names and copyrights, and none of the licenses and rights to the foregoing
presently owned or held by the Company are in dispute or are in any conflict
with the right of any other person or entity. Except as otherwise disclosed in
the Prospectus, the Company (i) owns or has the right to use, free and clear of
all liens, charges, claims, encumbrances, pledges, security interests, defects
or other restrictions or equities of any kind whatsoever, all patents, patent
applications, trademarks, service marks, service names, trade names and
copyrights, technology and licenses and rights with respect to the foregoing,
used in the conduct of its business as now conducted or proposed to be conducted
without infringing upon or otherwise acting adversely to the right or claimed
right of any person, corporation or other entity under or with respect to any of
the foregoing and (ii) is not obligated or under any liability whatsoever to
make any payment by way of royalties, fees or otherwise to any owner or licensee
of, or other claimant to, any patent, patent application, trademark, service
mark, service name, trade name, copyright, know-how, technology or other
intangible asset, with respect to the use thereof or in connection with the
conduct of its business or otherwise.
(t) There is no action, suit, proceeding, inquiry, arbitration,
investigation, litigation or governmental or other proceeding, domestic or
foreign, pending or threatened (or circumstances that may give rise to the same)
against the Company which challenges the exclusive rights of the Company with
respect to any trademarks, trade names, service marks, service names,
copyrights, patents, patent applications or licenses or rights to the foregoing
used in the conduct of its business, or which challenge the right of the Company
to use any technology presently used or contemplated to be used in the conduct
of its business.
(u) The Company owns and has the unrestricted right to use all trade
secrets, know-how (including all other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures), inventions,
technology, designs, processes, works of authorship, computer programs and
technical data and information (collectively herein "intellectual property")
that are material to the development, manufacture, operation and sale of all
products and services sold or proposed to be sold by the Company, free and clear
of and without violating any right, lien, or claim of others, including without
limitation, former employers of its employees; provided, however, that the
possibility exists that other persons or entities, completely independently of
the Company, or its employees or agents, could have developed trade secrets or
items of technical information similar or identical to those of the Company. The
Company is not aware of any such development of similar or identical trade
secrets or technical information by others.
(v) The Company has good and marketable title to, or valid and
enforceable leasehold estates in, all items of real and personal property stated
in the Prospectus, to be owned or leased by it free and clear of all liens,
charges, claims, encumbrances, pledges, security interests, defects, or other
restrictions or equities of any kind whatsoever, other than those referred to in
the Prospectus, taxes, lessor's interests and liens for taxes not yet due and
payable.
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(w) Arthur Andersen LLP ("AA") whose report is filed with the
Commission as a part of the Registration Statement, are independent certified
public accountants as required by the Act and the Rules and Regulations.
(x) The Company has caused to be duly executed legally binding and
enforceable agreements pursuant to which all officers and directors of the
Company holding shares of the Common Stock or securities exercisable or
exchangeable for or convertible into shares of Common Stock issued and
outstanding agreed not to offer to sell, sell, transfer, hypothecate or
otherwise encumber or dispose of any such securities (either pursuant to Rule
144 of the Rules and Regulations or otherwise) for a period of not less than
nine (9) months following the effective date of the Registration Statement
without the prior written consent of the Representatives. The Company will cause
the Transfer Agent, as defined below, to mark an appropriate legend on the face
of stock certificates representing all of such securities and to place "stop
transfer" orders on the Company's stock ledgers. During the nine (9) month
period commencing on the effective date of the Registration Statement, the
Company shall not, without the prior written consent of the Representative,
sell, contract or offer to sell, issue, transfer, assign, pledge, distribute, or
otherwise dispose of, directly or indirectly, any shares of Common Stock or any
options, rights or warrants with respect to any shares of Common Stock, except
up to (i) [_________] shares of Common Stock issuable upon exercise of
outstanding stock options, (ii) [_________] shares of Common Stock reserved for
future issuance under the Company's 1999 Long Term Incentive Plan and (iii)
[______] shares of Common Stock issuable upon exercise of outstanding warrants.
(y) Except as described in the Prospectus under "Underwriting,"
there are no claims, payments, issuances, arrangements or understandings,
whether oral or written, for services in the nature of a finder's or origination
fee with respect to the sale of the Securities hereunder or any other
arrangements, agreements, understandings, payments or issuance with respect to
the Company or any of its officers, directors, stockholders, partners, employees
or affiliates that may affect the Underwriters' compensation, as determined by
the National Association of Securities Dealers, Inc. ("NASD").
(z) The Common Stock has been approved for quotation on the Nasdaq
National Market ("Nasdaq").
(aa) Neither the Company nor any of its officers, employees, agents,
or any other person acting on behalf of the Company, has, directly or
indirectly, given or agreed to give any money, gift or similar benefit (other
than legal price concessions to customers in the ordinary course of business) to
any customer, supplier, employee or agent of a customer or supplier, or official
or employee of any governmental agency (domestic or foreign) or instrumentality
of any government (domestic or foreign) or any political party or candidate for
office (domestic or foreign) or other person who was, is, or may be in a
position to help or hinder the business of the Company (or assist the Company in
connection with any actual or proposed transaction) which (a) might subject the
Company, or any other such person to any damage or penalty in any civil,
criminal or governmental litigation or proceeding (domestic or foreign), (b) if
not given in the past, might have had a materially adverse effect on the assets,
business or operations of the Company, or (c) if not continued in the future,
might adversely affect the assets, business, operations or prospects of the
Company. The Company's internal accounting controls are
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<PAGE> 10
sufficient to cause the Company to comply with the Foreign Corrupt Practices Act
of 1977, as amended.
(bb) Except as set forth in the Prospectus, no officer, director or
stockholder of the Company, or any "affiliate" or "associate" (as these terms
are defined in Rule 405 promulgated under the Rules and Regulations) of any of
the foregoing persons or entities has or has had, either directly or indirectly,
(i) an interest in any person or entity which (A) furnishes or sells services or
products which are furnished or sold or are proposed to be furnished or sold by
the Company, or (B) purchases from or sells or furnishes to the Company any
goods or services, or (ii) a beneficial interest in any contract or agreement to
which the Company is a party or by which it may be bound or affected. Except as
set forth in the Prospectus under "Certain Transactions," there are no existing
agreements, arrangements, understandings or transactions, or proposed
agreements, arrangements, understandings or transactions, between or among the
Company and any officer, director, or Principal Stockholder (as such term is
defined in the Prospectus) of the Company or any partner, affiliate or associate
of any of the foregoing persons or entities.
(cc) Any certificate signed by any officer of the Company, and
delivered to the Underwriters or to Underwriters' Counsel (as defined herein)
shall be deemed a representation and warranty by the Company to the Underwriters
as to the matters covered thereby.
(dd) The minute books of the Company have been made available to the
Underwriters and contains a complete summary of all meetings and actions of the
directors, stockholders, audit committee, compensation committee and any other
committee of the Board of Directors of the Company, respectively, since the time
of its incorporation, and reflects all transactions referred to in such minutes
accurately in all material respects.
(ee) Except and to the extent described in the Prospectus, no
holders of any securities of the Company or of any options, warrants or other
convertible or exchangeable securities of the Company have the right to include
any securities issued by the Company in the Registration Statement or any
registration statement to be filed by the Company or to require the Company to
file a registration statement under the Act and no person or entity holds any
anti-dilution rights with respect to any securities of the Company.
(ff) The Company has made all filings on a timely basis as required
under the Exchange Act.
2. Purchase, Sale and Delivery of the Securities and Representatives'
Warrants.
(a) On the basis of the representations, warranties, covenants and
agreements herein contained, but subject to the terms and conditions herein set
forth, the Company agrees to sell to each Underwriter, and each Underwriter,
severally and not jointly, agrees to purchase from the Company at a price of
$______ [93% of the initial public offering price] per share of Common Stock,
that number of Firm Shares set forth in Schedule A opposite the name of such
Underwriter, plus any additional number of Firm Shares which such Underwriter
may become obligated to purchase pursuant to the provisions of Section 11
hereof.
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<PAGE> 11
(b) In addition, on the basis of the representations, warranties,
covenants and agreements herein contained, but subject to the terms and
conditions herein set forth, the Company hereby grants an option to the
Underwriters, severally and not jointly, to purchase all or any part of the
Option Shares. The option granted hereby will expire 45 days after (i) the date
the Registration Statement becomes effective, if the Company has elected not to
rely on Rule 430A under the Rules and Regulations, or (ii) the date of this
Agreement if the Company has elected to rely upon Rule 430A under the Rules and
Regulations, and may be exercised in whole or in part from time to time only for
the purpose of covering over-allotments which may be made in connection with the
offering and distribution of the Firm Shares upon notice by the Representatives
to the Company setting forth the number of Option Shares as to which the several
Underwriters are then exercising the option and the time and date of payment and
delivery for any such Option Shares. Any such time and date of delivery (an
"Option Closing Date") shall be determined by the Representative, but shall not
be later than seven full business days after the exercise of said option, nor in
any event prior to the Closing Date, as hereinafter defined, unless otherwise
agreed upon by the Representatives and the Company. Nothing herein contained
shall obligate the Underwriters to make any over-allotments. No Option Shares
shall be delivered unless the Firm Shares shall be simultaneously delivered or
shall theretofore have been delivered as herein provided.
(c) Payment of the purchase price for, and delivery of certificates
for, the Firm Shares shall be made at the offices of H.C. Wainwright & Co.,
Inc., One Boston Place, 40th Floor, Boston, Massachusetts 02108, or at such
other place as shall be agreed upon by the Representatives and the Company. Such
delivery and payment shall be made at 10:00 a.m. (New York City time) on
_______________, 2000 or at such other time and date as shall be agreed upon by
the Representatives and the Company, but not less than three (3) nor more than
seven (7) full business days after the effective date of the Registration
Statement (such time and date of payment and delivery being herein called
"Closing Date"). In addition, in the event that any or all of the Option Shares
are purchased by the Underwriters, payment of the purchase price for, and
delivery of certificates for, such Option Shares shall be made at the above
mentioned office of the Representatives or at such other place as shall be
agreed upon by the Representatives and the Company on each Option Closing Date
as specified in the notice from the Representatives to the Company. Delivery of
the certificates for the Firm Shares and the Option Shares, if any, shall be
made to the Underwriters against payment by the Underwriters, severally and not
jointly, of the purchase price for the Firm Shares and the Option Shares, if
any, to the order of the Company for the Firm Shares and the Option Shares, if
any, by New York Clearing House funds. In the event such option is exercised,
each of the Underwriters, acting severally and not jointly, shall purchase that
proportion of the total number of Option Shares then being purchased which the
number of Firm Shares set forth in Schedule A hereto opposite the name of such
Underwriter bears to the total number of Firm Shares, subject in each case to
such adjustments as the Representatives in its discretion shall make to
eliminate any sales or purchases of fractional shares. Certificates for the Firm
Shares and the Option Shares, if any, shall be in definitive, fully registered
form, shall bear no restrictive legends and shall be in such denominations and
registered in such names as the Underwriters may request in writing at least two
(2) business days prior to the Closing Date or the relevant Option Closing Date,
as the case may be. The certificates for the Firm Shares and the Option Shares,
if any, shall be made available to the Representatives at such office or such
other place as the Representatives may designate for
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<PAGE> 12
inspection, checking and packaging no later than 9:30 a.m. on the last business
day prior to Closing Date or the relevant Option Closing Date, as the case may
be.
(d) On the Closing Date, the Company shall issue and sell to the
Representatives, Representatives' Warrants at a purchase price of $.0001 per
warrant, which warrants shall entitle the holders thereof to purchase an
aggregate of 250,000 shares of Common Stock. The Representatives' Warrants shall
be exercisable for a period of four years commencing one year from the effective
date of the Registration Statement at a price equaling one hundred twenty
percent (120%) of the initial public offering price of the shares of Common
Stock. The Representatives' Warrant Agreement and form of Warrant Certificate
shall be substantially in the form filed as Exhibit 4.2 to the Registration
Statement. Payment for the Representatives' Warrants shall be made on the
Closing Date.
3. Public Offering of the Shares. As soon after the Registration Statement
becomes effective as the Representatives deem advisable, the Underwriters shall
make a public offering of the Shares (other than to residents of or in any
jurisdiction in which qualification of the Shares is required and has not become
effective) at the price and upon the other terms set forth in the Prospectus.
The Representatives may from time to time increase or decrease the public
offering price after distribution of the Shares has been completed to such
extent as the Representative, in its discretion deem advisable. The Underwriters
may enter into one of more agreements as the Underwriters, in each of their sole
discretion, deem advisable with one or more broker-dealers who shall act as
dealers in connection with such public offering.
4. Covenants and Agreements of the Company.
The Company covenants and agrees with each of the Underwriters as
follows:
(a) The Company shall use its best efforts to cause the Registration
Statement and any amendments thereto to become effective as promptly as
practicable and will not at any time, whether before or after the effective date
of the Registration Statement, file any amendment to the Registration Statement
or supplement to the Prospectus or file any document under the Act or Exchange
Act before termination of the offering of the Shares by the Underwriters of
which the Representatives shall not previously have been advised and furnished
with a copy, or to which the Representatives shall have objected or which is not
in compliance with the Act, the Exchange Act and the Rules and Regulations.
(b) As soon as the Company is advised or obtains knowledge thereof,
the Company will advise the Representatives and confirm the notice in writing,
(i) when the Registration Statement, as amended, becomes effective, if the
provisions of Rule 430A promulgated under the Act will be relied upon, when the
Prospectus has been filed in accordance with said Rule 430A and when any
post-effective amendment to the Registration Statement becomes effective, (ii)
of the issuance by the Commission of any stop order or of the initiation, or the
threatening, of any proceeding, suspending the effectiveness of the Registration
Statement or any order preventing or suspending the use of the Preliminary
Prospectus or the Prospectus, or any amendment or supplement thereto, or the
institution of proceedings for that purpose, (iii) of the issuance by the
Commission or by any state securities commission of any proceedings for the
suspension of the qualification of any of the Securities for offering or sale in
any jurisdiction or
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<PAGE> 13
of the initiation, or the threatening, of any proceeding for that purpose, (iv)
of the receipt of any comments from the Commission; and (v) of any request by
the Commission for any amendment to the Registration Statement or any amendment
or supplement to the Prospectus or for additional information. If the Commission
or any state securities commission authority shall enter a stop order or suspend
such qualification at any time, the Company will make every effort to obtain
promptly the lifting of such order.
(c) The Company shall file the Prospectus (in form and substance
satisfactory to the Representative) or transmit the Prospectus by a means
reasonably calculated to result in filing with the Commission pursuant to Rule
424(b)(1) (or, if applicable and if consented to by the Representative, pursuant
to Rule 424(b)(4)) not later than the Commission's close of business on the
earlier of (i) the second business day following the execution and delivery of
this Agreement and (ii) the fifteenth business day after the effective date of
the Registration Statement.
(d) The Company will give the Representatives notice of its
intention to file or prepare any amendment to the Registration Statement
(including any post-effective amendment) or any amendment or supplement to the
Prospectus (including any revised prospectus which the Company proposes for use
by the Underwriters in connection with the offering of the Securities which
differs from the corresponding prospectus on file at the Commission at the time
the Registration Statement becomes effective, whether or not such revised
prospectus is required to be filed pursuant to Rule 424(b) of the Rules and
Regulations), and will furnish the Representatives with copies of any such
amendment or supplement a reasonable amount of time prior to such proposed
filing or use, as the case may be, and will not file any such prospectus to
which the Representatives or Orrick, Herrington & Sutcliffe LLP ("Underwriters'
Counsel"), shall object.
(e) The Company shall endeavor in good faith, in cooperation with
the Representative, at or prior to the time the Registration Statement becomes
effective, to qualify the Securities for offering and sale under the securities
laws of such jurisdictions as the Representatives may designate to permit the
continuance of sales and dealings therein for as long as may be necessary to
complete the distribution, and shall make such applications, file such documents
and furnish such information as may be required for such purpose; provided,
however, the Company shall not be required to qualify as a foreign corporation
or file a general or limited consent to service of process in any such
jurisdiction. In each jurisdiction where such qualification shall be effected,
the Company will, unless the Representatives agree that such action is not at
the time necessary or advisable, use all reasonable efforts to file and make
such statements or reports at such times as are or may reasonably be required by
the laws of such jurisdiction to continue such qualification.
(f) During the time when a prospectus is required to be delivered
under the Act, the Company shall use all reasonable efforts to comply with all
requirements imposed upon it by the Act and the Exchange Act, as now and
hereafter amended and by the Rules and Regulations, as from time to time in
force, so far as necessary to permit the continuance of sales of or dealings in
the Securities in accordance with the provisions hereof and the Prospectus, or
any amendments or supplements thereto. If at any time when a prospectus relating
to the Securities is required to be delivered under the Act, any event shall
have occurred as a result of which, in the opinion of counsel for the Company or
Underwriters' Counsel, the Prospectus, as
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<PAGE> 14
then amended or supplemented, includes an untrue statement of a material fact or
omits to state any material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, or if it is necessary at any time to amend the
Prospectus to comply with the Act, the Company will notify the Representatives
promptly and prepare and file with the Commission an appropriate amendment or
supplement in accordance with Section 10 of the Act, each such amendment or
supplement to be satisfactory to Underwriters' Counsel, and the Company will
furnish to the Underwriters copies of such amendment or supplement as soon as
available and in such quantities as the Underwriters may request.
(g) As soon as practicable, but in any event not later than 45 days
after the end of the 12-month period beginning on the day after the end of the
fiscal quarter of the Company during which the effective date of the
Registration Statement occurs (90 days in the event that the end of such fiscal
quarter is the end of the Company's fiscal year), the Company shall make
generally available to its security holders, in the manner specified in Rule
158(b) of the Rules and Regulations, and to the Representative, an earnings
statement which will be in the detail required by, and will otherwise comply
with, the provisions of Section 11(a) of the Act and Rule 158(a) of the Rules
and Regulations, which statement need not be audited unless required by the Act,
covering a period of at least 12 consecutive months after the effective date of
the Registration Statement.
(h) During a period of seven years after the date hereof, the
Company will furnish to its stockholders annual reports (including financial
statements audited by independent public accountants) and will deliver to the
Representative:
(i) concurrently with furnishing such quarterly reports to its
stockholders, statements of income of the Company for each quarter
in the form furnished to the Company's stockholders and certified by
the Company's principal financial or accounting officer;
(ii) concurrently with furnishing such annual reports to its
stockholders, a balance sheet of the Company as at the end of the
preceding fiscal year, together with statements of operations,
stockholders' equity, and cash flows of the Company for such fiscal
year, accompanied by a copy of the report thereon of independent
certified public accountants;
(iii) as soon as they are available, copies of all reports
(financial or other) mailed to stockholders;
(iv) as soon as they are available, copies of all reports and
financial statements furnished to or filed with the Commission, the
NASD or any securities exchange;
(v) every press release and every material news item or
article of interest to the financial community in respect of the
Company, or its affairs which was released or prepared by or on
behalf of the Company; and
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<PAGE> 15
(vi) any additional information of a public nature concerning
the Company (and any future subsidiary) or its businesses which the
Representatives may request.
During such five (5)-year period, if the Company has an active
subsidiary, the foregoing financial statements will be on a consolidated basis
to the extent that the accounts of the Company and its subsidiary are
consolidated, and will be accompanied by similar financial statements for any
significant subsidiary which is not so consolidated.
(i) The Company will maintain a Transfer Agent and, if necessary
under the jurisdiction of incorporation of the Company, a Registrar (which may
be the same entity as the Transfer Agent) for its Common Stock.
(j) The Company will furnish to the Representatives or on the
Representatives' order, without charge, at such place as the Representatives may
designate, copies of each Preliminary Prospectus, the Registration Statement and
any pre-effective or post-effective amendments thereto (two of which copies will
be signed and will include all financial statements and exhibits), the
Prospectus, and all amendments and supplements thereto, including any prospectus
prepared after the effective date of the Registration Statement, in each case as
soon as reasonably available and in such quantities as the Representatives may
request.
(k) On or before the effective date of the Registration Statement,
the Company shall provide the Representatives with true copies of duly executed,
legally binding and enforceable agreements pursuant to which for a period of not
less than nine (9) months from the effective date of the Registration Statement
all officers and directors of the Company holding shares of the Common Stock or
securities exercisable or exchangeable for or convertible into shares of Common
Stock issued and outstanding will not offer to sell, sell, transfer, hypothecate
or otherwise encumber or dispose of any such securities (either pursuant to Rule
144 of the Rules and Regulations or otherwise) without the prior written consent
of the Representatives (collectively, the "Lock-up Agreements"). On or before
the Closing Date, the Company shall deliver instructions to the Transfer Agent
authorizing it to place appropriate legends on the certificates representing the
securities subject to the Lock-up Agreements and to place appropriate stop
transfer orders on the Company's ledgers. During the nine (9) month period
commencing with the effective date of the Registration Statement, the Company
shall not, without the prior written consent of the Representative, sell,
contract or offer to sell, issue, transfer, assign, pledge, hypothecate,
distribute, or otherwise dispose of, directly or indirectly, any shares of
Common Stock or any options, rights or warrants with respect to any shares of
Common Stock, except up to (i) [_________] shares of Common Stock issuable upon
exercise of outstanding stock options, (ii) [________] shares of Common Stock
reserved for future issuance under the Company's 1999 Long Term Incentive Plan
and (iii) [_______] shares of Common Stock issuable upon exercise of outstanding
warrants. During the nine (9) month period commencing with the effective date of
the Registration Statement, the Company shall not file any registration
statement with the Securities and Exchange Commission on Form S-8 without the
prior written consent of the Representatives.
(l) Neither the Company, nor any of its officers, directors,
stockholders, nor any of their respective affiliates (within the meaning of the
Rules and Regulations) will take,
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<PAGE> 16
directly or indirectly, any action designed to, or which might in the future
reasonably be expected to cause or result in, stabilization or manipulation of
the price of any securities of the Company.
(m) The Company shall apply the net proceeds from the sale of the
Securities in the manner, and subject to the conditions, set forth under "Use of
Proceeds" in the Prospectus. Except as described in the Prospectus, no portion
of the net proceeds will be used, directly or indirectly, to acquire any
securities issued by the Company.
(n) The Company shall timely file all such reports, forms or other
documents as may be required (including, but not limited to, a Form SR as may be
required pursuant to Rule 463 under the Act) from time to time, under the Act,
the Exchange Act, and the Rules and Regulations, and all such reports, forms and
documents filed will comply as to form and substance with the applicable
requirements under the Act, the Exchange Act, and the Rules and Regulations.
(o) The Company shall furnish to the Representatives as early as
practicable prior to each of the date hereof, the Closing Date and each Option
Closing Date, if any, but no later than two (2) full business days prior
thereto, a copy of the latest available unaudited interim financial statements
of the Company (which in no event shall be as of a date more than thirty (30)
days prior to the date of the Registration Statement) which have been read by
the Company's independent public accountants, as stated in their letter to be
furnished pursuant to Section 6(j) hereof.
(p) The Company shall cause the Common Stock to be quoted on Nasdaq
or a National Securities exchange and for a period of seven (7) years from the
date hereof, and use its best efforts to maintain the Nasdaq quotation or
exchange listing of the Common Stock to the extent outstanding.
(q) For a period of five (5) years from the Closing Date, the
Company shall furnish to the Representatives at the Representatives' request and
at the Company's sole expense, (i) daily consolidated transfer sheets relating
to the Common Stock, (ii) the list of holders of all of the Company's securities
and (iii) a Blue Sky "Trading Survey" for secondary sales of the Company's
securities prepared by counsel to the Company.
(r) As soon as practicable, but in no event more than 30 days from
the effective date of the Registration Statement, take all necessary and
appropriate actions to be included in Standard and Poor's Corporation
Descriptions and Moody's OTC Manual and to continue such inclusion for a period
of not less than seven (7) years.
(s) The Company hereby agrees that it will not for a period of
thirteen (13) months from the effective date of the Registration Statement,
adopt, propose to adopt or otherwise permit to exist any employee, officer,
director, consultant or compensation plan or arrangement permitting the grant,
issue or sale of any shares of Common Stock or other securities of the Company
(i) in an amount greater than an aggregate of __________ shares of Common Stock,
(ii) at an exercise or sale price per share less than the fair market value of
the Common Stock on the date of grant or sale, (iii) to any direct or indirect
beneficial holder on the
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<PAGE> 17
date hereof of more than 10% of the issued and outstanding shares of Common
Stock, (iv) with the payment for such securities with any form of consideration
other than cash, (v) upon payment of less than the full purchase or exercise
price for such shares of Common Stock or other securities of the Company.
(t) Until the completion of the distribution of the Shares, and for
25 days thereafter, the Company shall not without the prior written consent of
the Representatives and Underwriters' Counsel, issue, directly or indirectly,
any press release or other communication or hold any press conference with
respect to the Company or its activities or the offering contemplated hereby.
(u) For a period equal to the lesser of (i) seven (7) years from the
date hereof, and (ii) the sale to the public of the Representatives' Shares, the
Company will not take any action or actions which may prevent or disqualify the
Company's use of Form S-1 (or other appropriate form) for the registration under
the Act of the Representatives' Shares.
5. Payment of Expenses.
(a) The Company hereby agrees to pay on each of the Closing Date and
the Option Closing Date (to the extent not paid at the Closing Date) all
expenses and fees (other than fees of Underwriters' Counsel, except as provided
in (iv) below) incident to the performance of the obligations of the Company
under this Agreement and the Representatives' Warrant Agreement, including,
without limitation, (i) the fees and expenses of accountants and counsel for the
Company, (ii) all costs and expenses incurred in connection with the
preparation, duplication, printing, (including mailing and handling charges)
filing, delivery and mailing (including the payment of postage with respect
thereto) of the Registration Statement and the Prospectus and any amendments and
supplements thereto and the printing, mailing (including the payment of postage
with respect thereto) and delivery of this Agreement, the Agreement Among
Underwriters, the Selected Dealer Agreements, and related documents, including
the cost of all copies thereof and of the Preliminary Prospectuses and of the
Prospectus and any amendments thereof or supplements thereto supplied to the
Underwriters and such dealers as the Underwriters may request, in quantities as
hereinabove stated, (iii) the printing, engraving, issuance and delivery of the
Securities including, but not limited to, (x) the purchase by the Underwriters
of the Shares and the purchase by the Representatives of the Representatives'
Warrants from the Company, (y) the consummation by the Company of any of its
obligations under this Agreement and the Representatives' Warrant Agreement, and
(z) resale of the Shares by the Underwriters in connection with the distribution
contemplated hereby, (iv) the qualification of the Securities under state or
foreign securities or "Blue Sky" laws and determination of the status of such
securities under legal investment laws, including the costs of printing and
mailing the "Preliminary Blue Sky Memorandum," the "Supplemental Blue Sky
Memorandum" and "Legal Investments Survey," if any, and disbursements and fees
of counsel in connection therewith, (v) costs and expenses in connection with
due diligence investigations, including but not limited to the fees of any
independent counsel or consultant retained, (vi) fees and expenses of the
transfer agent and registrar, (vii) applications for assignments of a rating of
the Securities by qualified rating agencies, (viii) the fees payable to the
Commission and the NASD, and (ix) the fees and expenses incurred in connection
with the quotation of the Securities on Nasdaq and any other exchange.
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(b) If this Agreement is terminated by the Underwriters in
accordance with the provisions of Section 6 or Section 12, the Company shall
reimburse and indemnify the Representatives for all of their actual
out-of-pocket expenses, including the fees and disbursements of Underwriters'
Counsel, less any amounts already paid pursuant to Section 5(c) hereof.
(c) The Company further agrees that, in addition to the expenses
payable pursuant to subsection (a) of this Section 5, it will pay to the
Representatives on the Closing Date by certified or bank cashier's check or, at
the election of the Representative, by deduction from the proceeds of the
offering contemplated herein a non-accountable expense allowance of the greater
of $250,000 or one percent (1%) of the gross proceeds received by the Company
from the sale of the Firm Shares. In the event the Representatives elects to
exercise the over-allotment option described in Section 2(b) hereof, the Company
agrees to pay to the Representatives on the Option Closing Date (by certified or
bank cashier's check, or at the Representatives' election, by deduction from the
proceeds of the Option Shares) a non-accountable expense allowance equal to one
percent (1%) of the gross proceeds received by the Company from the sale of the
Option Shares.
6. Conditions of the Underwriters' Obligations. The obligations of the
Underwriters hereunder shall be subject to the continuing accuracy of the
representations and warranties of the Company herein as of the date hereof and
as of the Closing Date and each Option Closing Date, if any, with respect to the
Company as if it had been made on and as of the Closing Date or each Option
Closing Date, as the case may be; the accuracy on and as of the Closing Date or
Option Closing Date, if any, of the statements of the officers of the Company
made pursuant to the provisions hereof; and the performance by the Company on
and as of the Closing Date and each Option Closing Date, if any, of their
respective covenants and obligations hereunder and to the following further
conditions:
(a) The Registration Statement shall have become effective not later
than 12:00 Noon, New York time, on the date of this Agreement or such later date
and time as shall be consented to in writing by the Representative, and, at the
Closing Date and each Option Closing Date, if any, no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted or shall be pending or
contemplated by the Commission and any request on the part of the Commission for
additional information shall have been complied with to the reasonable
satisfaction of Underwriters' Counsel. If the Company has elected to rely upon
Rule 430A of the Rules and Regulations, the price of the Shares and any
price-related information previously omitted from the effective Registration
Statement pursuant to such Rule 430A shall have been transmitted to the
Commission for filing pursuant to Rule 424(b) of the Rules and Regulations
within the prescribed time period, and prior to the Closing Date the Company
shall have provided evidence satisfactory to the Representatives of such timely
filing, or a post-effective amendment providing such information shall have been
promptly filed and declared effective in accordance with the requirements of
Rule 430A of the Rules and Regulations.
(b) The Representatives shall not have advised the Company that the
Registration Statement, or any amendment thereto, contains an untrue statement
of fact which, in the Representatives' opinion, is material, or omits to state a
fact which, in the Representatives'
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opinion, is material and is required to be stated therein or is necessary to
make the statements therein not misleading, or that the Prospectus, or any
supplement thereto, contains an untrue statement of fact which, in the
Representatives' opinion, is material, or omits to state a fact which, in the
Representatives' opinion, is material and is required to be stated therein or is
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.
(c) On or prior to the Closing Date, the Representatives shall have
received from Underwriters' Counsel, such opinion or opinions with respect to
the organization of the Company, the validity of the Securities, the
Representatives' Warrants, the Registration Statement, the Prospectus and other
related matters as the Representatives request and Underwriters' Counsel shall
have received such papers and information as they request to enable them to pass
upon such matters.
(d) At the Closing Date, the Underwriters shall have received the
favorable opinion of Frankfurt, Garbus, Klein & Selz, P.C., counsel to the
Company, dated the Closing Date, addressed to the Underwriters and in form and
substance satisfactory to Underwriters' Counsel, to the effect that:
(i) the Company (A) has been duly organized and is validly
existing as a corporation in good standing under the laws of its
jurisdiction of organization, (B) is duly qualified and licensed and
in good standing as a foreign corporation in each jurisdiction in
which its ownership or leasing of any properties or the character of
its operations requires such qualification or licensing, and (C) has
all requisite corporate power and authority; and the Company has
obtained any and all necessary authorizations, approvals, orders,
licenses, certificates, franchises and permits of and from all
governmental or regulatory officials and bodies (including, without
limitation, those having jurisdiction over environmental or similar
matters), to own or lease its properties and conduct its business as
described in the Prospectus; the Company is and has been doing
business in material compliance with all such authorizations,
approvals, orders, licenses, certificates, franchises and permits
and all federal, state and local laws, rules and regulations; the
Company has not received any notice of proceedings relating to the
revocation or modification of any such authorization, approval,
order, license, certificate, franchise, or permit which, singly or
in the aggregate, if the subject of an unfavorable decision, ruling
or finding, would materially adversely affect the business,
operations, condition, financial or otherwise, or the earnings,
business affairs, position, prospects, value, operation, properties,
business or results of operations of the Company. The disclosures in
the Registration Statement concerning the effects of federal, state
and local laws, rules and regulations on the Company's business as
currently conducted and as contemplated are correct in all material
respects and do not omit to state a fact necessary to make the
statements contained therein not misleading in light of the
circumstances in which they were made;
(ii) to the best of such counsel's knowledge, the Company does
not own an interest in any other corporation, partnership, joint
venture, trust or other business entity;
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<PAGE> 20
(iii) the Company has a duly authorized, issued and
outstanding capitalization as set forth in the Prospectus, and any
amendment or supplement thereto, under "Capitalization" and
"Description of Securities," and is not a party to or bound by any
instrument, agreement or other arrangement providing for it to issue
any capital stock, rights, warrants, options or other securities,
except for this Agreement, the Representatives' Warrant Agreement
and as described in the Prospectus. The Securities, and all other
securities issued or issuable by the Company conform in all material
respects to all statements with respect thereto contained in the
Registration Statement and the Prospectus. All issued and
outstanding securities of the Company have been duly authorized and
validly issued and are fully paid and non-assessable; the holders
thereof have no rights of rescission with respect thereto, and are
not subject to personal liability by reason of being such holders;
and none of such securities were issued in violation of the
preemptive rights of any holders of any security of the Company. The
Shares, the Representatives' Warrants and the Representatives'
Shares to be sold by the Company hereunder and under the
Representatives' Warrant Agreement are not and will not be subject
to any preemptive or other similar rights of any stockholder, have
been duly authorized and, when issued, paid for and delivered in
accordance with the terms hereof, will be validly issued, fully paid
and non-assessable and conform to the description thereof contained
in the Prospectus; the holders thereof will not be subject to any
liability solely as such holders; all corporate action required to
be taken for the authorization, issue and sale of the Shares, the
Representatives' Warrants and the Representatives' Shares has been
duly and validly taken, and the certificates representing the Shares
and the Representatives' Warrants are in due and proper form. The
Representatives' Warrants constitute valid and binding obligations
of the Company to issue and sell, upon exercise thereof and payment
therefor, the number and type of securities of the Company called
for thereby. Upon the issuance and delivery pursuant to this
Agreement and the Representatives' Warrant Agreement of the Shares
and the Representatives' Warrants, respectively, to be sold by the
Company, the Underwriters and the Representative, respectively, will
acquire good and marketable title to the Shares and the
Representatives' Warrants free and clear of any pledge, lien,
charge, claim, encumbrance, pledge, security interest, or other
restriction or equity of any kind whatsoever. No transfer tax is
payable by or on behalf of the Underwriters in connection with (A)
the issuance by the Company of the Shares, (B) the purchase by the
Underwriters and the Representatives of the Shares and the
Representatives' Warrants, respectively, from the Company, (C) the
consummation by the Company of any of its obligations under this
Agreement or the Representatives' Warrant Agreement, or (D) resales
of the Shares in connection with the distribution contemplated
hereby;
(iv) the Registration Statement is effective under the Act,
and, if applicable, filing of all pricing information has been
timely made in the appropriate form under Rule 430A, and no stop
order suspending the use of the Preliminary Prospectus, the
Registration Statement or Prospectus or any part of any thereof or
suspending the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been instituted or
are pending or, to the best of such counsel's knowledge threatened
or contemplated under the Act;
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<PAGE> 21
(v) each of the Preliminary Prospectus, the Registration
Statement, and the Prospectus and any amendments or supplements
thereto (other than the financial statements and other financial and
statistical data included therein, as to which no opinion need be
rendered) comply as to form in all material respects with the
requirements of the Act and the Rules and Regulations;
(vi) to the best of such counsel's knowledge, (A) there are no
agreements, contracts or other documents required by the Act to be
described in the Registration Statement and the Prospectus and filed
as exhibits to the Registration Statement other than those described
in the Registration Statement (or required to be filed under the
Exchange Act if upon such filing they would be incorporated, in
whole or in part, by reference therein) and the Prospectus and filed
as exhibits thereto, and the exhibits which have been filed are
correct copies of the documents of which they purport to be copies;
(B) the descriptions in the Registration Statement and the
Prospectus and any supplement or amendment thereto of contracts and
other documents to which the Company is a party or by which it is
bound, including any document to which the Company is a party or by
which it is bound, incorporated by reference into the Prospectus and
any supplement or amendment thereto, are accurate in all material
respects and fairly represent the information required to be shown
by Form S-1; (C) there is not pending or threatened against the
Company any action, arbitration, suit, proceeding, inquiry,
investigation, litigation, governmental or other proceeding
(including, without limitation, those involving environmental or
similar matters), domestic or foreign, pending or threatened against
(or circumstances that may give rise to the same), or involving the
properties or business of the Company which (x) is required to be
disclosed in the Registration Statement which is not so disclosed,
(and such proceedings as are summarized in the Registration
Statement are accurately summarized in all material respects), (y)
questions the validity of the capital stock of the Company or this
Agreement or the Representatives' Warrant Agreement, or of any
action taken or to be taken by the Company pursuant to or in
connection with any of the foregoing; (D) no statute or regulation
or legal or governmental proceeding required to be described in the
Prospectus is not described as required; and (E) there is no action,
suit or proceeding pending, or threatened, against or affecting the
Company before any court or arbitrator or governmental body, agency
or official (or any basis thereof known to such counsel) in which
there is a reasonable possibility of an adverse decision which may
result in a material adverse change in the condition, financial or
otherwise, or the earnings, position, prospects, stockholders'
equity, value, operation, properties, business or results of
operations of the Company, which could adversely affect the present
or prospective ability of the Company to perform its obligations
under this Agreement or the Representatives' Warrant Agreement or
which in any manner draws into question the validity or
enforceability of this Agreement or the Representatives' Warrant
Agreement;
(vii) the Company has full legal right, power and authority to
enter into each of this Agreement and the Representatives' Warrant
Agreement and to consummate the transactions provided for herein and
therein; and each of this Agreement and the Representatives' Warrant
Agreement has been duly authorized, executed and delivered by the
Company. Each of this Agreement and the
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<PAGE> 22
Representatives' Warrant Agreement, assuming due authorization,
execution and delivery by each other party thereto constitutes a
legal, valid and binding agreement of the Company enforceable
against the Company in accordance with its terms (except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws of general application
relating to or affecting enforcement of creditors' rights and the
application of equitable principles in any action, legal or
equitable, and except as rights to indemnity or contribution may be
limited by applicable law), and none of the Company's execution or
delivery of this Agreement and the Representatives' Warrant
Agreement, its performance hereunder or thereunder, its consummation
of the transactions contemplated herein or therein, or the conduct
of its business as described in the Registration Statement, the
Prospectus and any amendments or supplements thereto, conflicts with
or will conflict with or results or will result in any breach or
violation of any of the terms or provisions of, or constitutes or
will constitute a default under, or result in the creation or
imposition of any lien, charge, claim, encumbrance, pledge, security
interest, defect or other restriction or equity of any kind
whatsoever upon, any property or assets (tangible or intangible) of
the Company pursuant to the terms of, (A) the articles of
incorporation or by-laws of the Company, (B) any license, contract,
indenture, mortgage, deed of trust, voting trust agreement,
stockholders agreement, note, loan or credit agreement or any other
agreement or instrument to which the Company is a party or by which
it is or may be bound or to which any of its respective properties
or assets (tangible or intangible) is or may be subject, or any
indebtedness, or (C) any statute, judgement, decree, order, rule or
regulation applicable to the Company of any arbitrator, court,
regulatory body or administrative agency or other governmental
agency or body (including, without limitation, those having
jurisdiction over environmental or similar matters), domestic or
foreign, having jurisdiction over the Company or any of its
activities or properties;
(viii) except as described in the Prospectus, no consent,
approval, authorization or order of, and no filing with, any court,
regulatory body, government agency or other body (other than such as
may be required under Blue Sky laws, as to which no opinion need be
rendered) is required in connection with the issuance of the Shares
pursuant to the Prospectus, the issuance of the Representatives'
Warrants, the performance of this Agreement and the Representatives'
Warrant Agreement and the transactions contemplated hereby and
thereby;
(ix) the properties and business of the Company conform in all
material respects to the description thereof contained in the
Registration Statement and the Prospectus; and the Company has good
and marketable title to, or valid and enforceable leasehold estates
in, all items of real and personal property stated in the Prospectus
to be owned or leased by it, in each case free and clear of all
liens, charges, claims, encumbrances, pledges, security interests,
defects or other restrictions or equities of any kind whatsoever,
other than those referred to in the Prospectus, and liens for taxes
not yet due and payable;
(x) to the best knowledge of such counsel, the Company is not
in breach of, or in default under, any term or provision of any
license, contract, indenture,
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<PAGE> 23
mortgage, installment sale agreement, deed of trust, lease, voting
trust agreement, stockholders' agreement, partnership agreement,
note, loan or credit agreement or any other agreement or instrument
evidencing an obligation for borrowed money, or any other agreement
or instrument to which the Company is a party or by which the
Company may be bound or to which the property or assets (tangible or
intangible) of the Company is subject or affected; and the Company
is not in violation of any term or provision of its certificate of
incorporation by-laws, or in violation of any franchise, license,
permit, judgment, decree, order, statute, rule or regulation;
(xi) the statements in the Prospectus under "BUSINESS,"
"MANAGEMENT," "PRINCIPAL AND SELLING STOCKHOLDERS," "CERTAIN
TRANSACTIONS," and "DESCRIPTION OF CAPITAL STOCK" have been reviewed
by such counsel, and insofar as they refer to statements of law,
descriptions of statutes, licenses, rules or regulations or legal
conclusions, are correct in all material respects;
(xii) the Shares have been accepted for quotation on Nasdaq;
(xiii) the persons listed under the caption "PRINCIPAL AND
SELLING STOCKHOLDERS" in the Prospectus are the respective
"beneficial owners" (as such phrase is defined in regulation 13d-3
under the Exchange Act) of the securities set forth opposite their
respective names thereunder as and to the extent set forth therein;
(xiv) except as described in the Prospectus, no person,
corporation, trust, partnership, association or other entity has the
right to include and/or register any securities of the Company in
the Registration Statement, require the Company to file any
registration statement or, if filed, to include any security in such
registration statement;
(xv) except as described in the Prospectus, there are no
claims, payments, issuances, arrangements or understandings for
services in the nature of a finder's or origination fee with respect
to the sale of the Securities hereunder or financial consulting
arrangement or any other arrangements, agreements, understandings,
payments or issuances that may affect the Underwriters'
compensation, as determined by the NASD;
(xvi) assuming due execution by the parties thereto other than
the Company, the Lock-up Agreements are legal, valid and binding
obligations of parties thereto, enforceable against the party and
any subsequent holder of the securities subject thereto in
accordance with its terms (except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other laws of general application relating to or
affecting enforcement of creditors' rights and the application of
equitable principles in any action, legal or equitable, and except
as rights to indemnity or contribution may be limited by applicable
law); and
(xvii) except as described in the Prospectus, the Company does
not (A) maintain, sponsor or contribute to any ERISA Plans, (B)
maintain or contribute, now
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<PAGE> 24
or at any time previously, to a defined benefit plan, as defined in
Section 3(35) of ERISA, and (C) has never completely or partially
withdrawn from a "multiemployer plan".
Such counsel shall state that such counsel has participated in conferences
with officers and other representatives of the Company and representatives of
the independent public accountants for the Company at which conferences such
counsel made inquiries of such officers, representatives and accountants and
discussed the contents of the Preliminary Prospectus, the Registration
Statement, the Prospectus, and related matters were discussed and, although such
counsel is not passing upon and does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Preliminary Prospectus, the Registration Statement and Prospectus, on the basis
of the foregoing, no facts have come to the attention of such counsel which lead
them to believe that either the Registration Statement or any amendment thereto,
at the time such Registration Statement or amendment became effective or the
Preliminary Prospectus or Prospectus or amendment or supplement thereto as of
the date of such opinion contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein not misleading (it being understood that such
counsel need express no opinion with respect to the financial statements and
schedules and other financial and statistical data included in the Preliminary
Prospectus, the Registration Statement or Prospectus).
Such opinion shall not state that it is to be governed or qualified by, or
that it is otherwise subject to, any treatise, written policy or other document
relating to legal opinions, including, without limitation, the Legal Opinion
Accord of the ABA Section of Business Law (1991), or any comparable State bar
accord.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws other than the laws of the United States and
jurisdictions in which they are admitted, to the extent such counsel deems
proper and to the extent specified in such opinion, if at all, upon an opinion
or opinions (in form and substance satisfactory to Underwriters' Counsel) of
other counsel acceptable to Underwriters' Counsel, familiar with the applicable
laws; (B) as to matters of fact, to the extent they deem proper, on certificates
and written statements of responsible officers of the Company, and certificates
or other written statements of officers of departments of various jurisdictions
having custody of documents respecting the corporate existence or good standing
of the Company, provided that copies of any such statements or certificates
shall be delivered to Underwriters' Counsel if requested. The opinion of such
counsel for the Company shall state that the opinion of any such other counsel
is in form satisfactory to such counsel and that the Representatives and they
are justified in relying thereon. Such opinion shall also state that
Underwriters' Counsel is entitled to rely thereon.
At each Option Closing Date, if any, the Underwriters shall have received
the favorable opinion of Dorsey & Whitney LLP, counsel to the Company, dated the
Option Closing Date, addressed to the Underwriters and in form and substance
satisfactory to Underwriters' Counsel confirming as of the Option Closing Date
the statements made by Dorsey & Whitney in its opinion delivered on the Closing
Date.
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(e) On or prior to each of the Closing Date and the Option Closing
Date, if any, Underwriters' Counsel shall have been furnished such documents,
certificates and opinions as they may reasonably require for the purpose of
enabling them to review or pass upon the matters referred to in subsection (c)
of this Section 6, or in order to evidence the accuracy, completeness or
satisfaction of any of the representations, warranties or conditions of the
Company, or herein contained.
(f) Prior to each of the Closing Date and each Option Closing Date,
if any, (i) there shall have been no material adverse change nor development
involving a prospective change in the condition, financial or otherwise,
prospects, stockholders' equity or the business activities of the Company,
whether or not in the ordinary course of business, from the latest dates as of
which such condition is set forth in the Registration Statement and Prospectus;
(ii) there shall have been no transaction, not in the ordinary course of
business, entered into by the Company, from the latest date as of which the
financial condition of the Company is set forth in the Registration Statement
and Prospectus which is materially adverse to the Company; (iii) the Company
shall not be in default under any provision of any instrument relating to any
outstanding indebtedness; (iv) the Company shall not have issued any securities
(other than the Securities); the Company shall not have declared or paid any
dividend or made any distribution in respect of its capital stock of any class;
and there has not been any change in the capital stock of the Company, or any
material change in the debt (long or short term) or liabilities or obligations
of the Company (contingent or otherwise); (v) no material amount of the assets
of the Company shall have been pledged or mortgaged, except as set forth in the
Registration Statement and Prospectus; (vi) no action, suit or proceeding, at
law or in equity, shall have been pending or threatened (or circumstances giving
rise to same) against the Company, or affecting any of its properties or
business before or by any court or federal, state or foreign commission, board
or other administrative agency wherein an unfavorable decision, ruling or
finding may adversely affect the business, operations, prospects or financial
condition or income of the Company, except as set forth in the Registration
Statement and Prospectus; and (vii) no stop order shall have been issued under
the Act and no proceedings therefor shall have been initiated, threatened or
contemplated by the Commission.
(g) At each of the Closing Date and each Option Closing Date, if
any, the Underwriters shall have received a certificate of the Company signed by
the principal executive officer and by the chief financial or chief accounting
officer of the Company, dated the Closing Date or Option Closing Date, as the
case may be, to the effect that each of such persons has carefully examined the
Registration Statement, the Prospectus and this Agreement, and that:
(i) The representations and warranties of the Company in this
Agreement are true and correct as if made on and as of the Closing
Date or the Option Closing Date, as the case may be, and the Company
has complied with all agreements and covenants and satisfied all
conditions contained in this Agreement on its part to be performed
or satisfied at or prior to such Closing Date or Option Closing
Date, as the case may be;
(ii) No stop order suspending the effectiveness of the
Registration Statement or any part thereof has been issued, and no
proceedings for that purpose
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<PAGE> 26
have been instituted or are pending or, to the best of each of such
person's knowledge, after due inquiry are contemplated or threatened
under the Act;
(iii) The Registration Statement and the Prospectus and, if
any, each amendment and each supplement thereto, contain all
statements and information required to be included therein, and none
of the Registration Statement, the Prospectus nor any amendment or
supplement thereto includes any untrue statement of a material fact
or omits to state any material fact required to be stated therein or
necessary to make the statements therein not misleading and neither
the Preliminary Prospectus nor any supplement thereto included any
untrue statement of a material fact or omitted to state any material
fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they
were made, not misleading; and
(iv) Subsequent to the respective dates as of which
information is given in the Registration Statement and the
Prospectus, (a) the Company has not incurred up to and including the
Closing Date or the Option Closing Date, as the case may be, other
than in the ordinary course of its business, any material
liabilities or obligations, direct or contingent; (b) the Company
has not paid or declared any dividends or other distributions on its
capital stock; (c) the Company has not entered into any transactions
not in the ordinary course of business; (d) there has not been any
change in the capital stock of the Company or any material change in
the debt (long or short-term) of the Company; (e) the Company has
not sustained any material loss or damage to its property or assets,
whether or not insured; (g) there is no litigation which is pending
or threatened (or circumstances giving rise to same) against the
Company, or any affiliated party of any of the foregoing which is
required to be set forth in an amended or supplemented Prospectus
which has not been set forth; and (h) there has occurred no event
required to be set forth in an amended or supplemented Prospectus
which has not been set forth.
References to the Registration Statement and the Prospectus in this subsection
(g) are to such documents as amended and supplemented at the date of such
certificate.
(h) By the Closing Date, the Underwriters will have received
clearance from the NASD as to the amount of compensation allowable or payable to
the Underwriters, as described in the Registration Statement.
(i) At the time this Agreement is executed, the Underwriters shall
have received a letter, dated such date, addressed to the Underwriters in form
and substance satisfactory (including the non-material nature of the changes or
decreases, if any, referred to in clause (iii) below) in all respects to the
Underwriters and Underwriters' Counsel, from AA.
(i) confirming that they are independent public accountants
with respect to the Company within the meaning of the Act and the
applicable Rules and Regulations;
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<PAGE> 27
(ii) stating that it is their opinion that the financial
statements and supporting schedules of the Company included in the
Registration Statement comply as to form in all material respects
with the applicable accounting requirements of the Act and the Rules
and Regulations thereunder and that the Representatives may rely
upon the opinion of AA with respect to such financial statements and
supporting schedules included in the Registration Statement;
(iii) stating that, on the basis of a limited review which
included a reading of the latest available unaudited interim
financial statements of the Company, a reading of the latest
available minutes of the stockholders and board of directors and the
various committees of the board of directors of the Company,
consultations with officers and other employees of the Company
responsible for financial and accounting matters and other specified
procedures and inquiries, nothing has come to their attention which
would lead them to believe that (A) the unaudited financial
statements and supporting schedules of the Company included in the
Registration Statement do not comply as to form in all material
respects with the applicable accounting requirements of the Act and
the Rules and Regulations or are not fairly presented in conformity
with generally accepted accounting principles applied on a basis
substantially consistent with that of the audited financial
statements of the Company included in the Registration Statement, or
(B) at a specified date not more than five (5) days prior to the
effective date of the Registration Statement, there has been any
change in the capital stock of the Company, any change in the
long-term debt of the Company, or any decrease in the stockholders'
equity of the Company or any decrease in the net current assets or
net assets of the Company as compared with amounts shown in the
[_______], 1999 balance sheet included in the Registration
Statement, other than as set forth in or contemplated by the
Registration Statement, or, if there was any change or decrease,
setting forth the amount of such change or decrease, and (C) during
the period from [_______], 1999 to a specified date not more than
five (5) days prior to the effective date of the Registration
Statement, there was any decrease in net revenues or net earnings of
the Company or increase in net earnings per common share of the
Company, in each case as compared with the corresponding period
beginning [_____], 1999 other than as set forth in or contemplated
by the Registration Statement, or, if there was any such decrease,
setting forth the amount of such decrease;
(iv) setting forth, at a date not later than five (5) days
prior to the date of the Registration Statement, the amount of
liabilities of the Company (including a break-down of commercial
paper and notes payable to the banks);
(v) stating that they have compared specific dollar amounts,
numbers of shares, percentages of revenues and earnings, statements
and other financial information pertaining to the Company set forth
in the Prospectus in each case to the extent that such amounts,
numbers, percentages, statements and information may be derived from
the general accounting records, including work sheets, of the
Company and excluding any questions requiring an interpretation by
legal counsel, with the results obtained from the application of
specified readings, inquiries and other appropriate procedures
(which procedures do not constitute an examination in
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<PAGE> 28
accordance with generally accepted auditing standards) set forth in
the letter and found them to be in agreement; and
(vi) statements as to such other matters incident to the
transaction contemplated hereby as the Representatives may request.
(j) At the Closing Date and each Option Closing Date, if any, the
Underwriters shall have received from AA a letter, dated as of the Closing Date
or the Option Closing Date, as the case may be, to the effect that they reaffirm
the statements made in the letter furnished pursuant to subsection (i) of this
Section 6 except that the specified date referred to shall be a date not more
than five (5) days prior to the Closing Date or the Option Closing Date, as the
case may be, and, if the Company has elected to rely on Rule 430A of the Rules
and Regulations, to the further effect that they have carried out procedures as
specified in clause (vi) of subsection (i) of this Section 6 with respect to
certain amounts, percentages and financial information as specified by the
Representatives and deemed to be a part of the Registration Statement pursuant
to Rule 430A(b) and have found such amounts, percentages and financial
information to be in agreement with the records specified in such clause (vi).
(k) The Company shall have delivered to the Representatives a letter
from AA addressed to the Company stating that they have not during the
immediately preceding two year period brought to the attention of the Company's
management any "weakness" as defined in Statement of Auditing Standards No. 60
"Communication of Internal Control Structure Related Matters Noted in an Audit,"
in any of the Company's internal controls.
(l) On each of the Closing Date and Option Closing Date, if any,
there shall have been duly tendered to the Representatives for the several
Underwriters' accounts the appropriate number of Shares.
(m) No order suspending the sale of the Securities in any
jurisdiction designated by the Representatives pursuant to subsection (e) of
Section 4 hereof shall have been issued on either the Closing Date or the Option
Closing Date, if any, and no proceedings for that purpose shall have been
instituted or shall be contemplated.
(n) On or before the Closing Date, the Underwriters shall have
received the favorable opinion of [______________], special patent counsel to
the Company, dated the Closing Date, addressed to the Underwriters, in form and
substance satisfactory to Underwriters' counsel, and in substantially the form
of Exhibit A attached hereto.
(o) At each Option Closing date, if any, the Underwriters shall have
received the favorable opinion of [_______________], dated the relevant Option
Closing Date, addressed to the Underwriters and in form and substance
satisfactory to Underwriter's Counsel confirming, as of the Option Closing Date,
the statements made by [_____________________], in its opinion delivered on the
Closing Date.
(p) On or before the Closing Date, the Company shall have executed
and delivered to the Representatives, (i) the Representatives' Warrant Agreement
substantially in the form filed as Exhibit 4.2 to the Registration Statement in
final form and substance satisfactory to
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<PAGE> 29
the Representatives, and (ii) the Representatives' Warrants in such
denominations and to such designees as shall have been provided to the Company.
(q) On or before the Closing Date, the Shares shall have been duly
approved for quotation on Nasdaq, subject to official notice of issuance.
(r) On or before the Closing Date, there shall have been delivered
to the Representatives all of the Lock-up Agreements, in form and substance
satisfactory to Underwriters' Counsel.
(s) On or before the Closing Date, there shall have been delivered
to the Representatives agreements waiving registration rights of the Company's
security holders for a period of nine months from the effective date of the
Registration Statement, in form and substance satisfactory to Underwriters'
Counsel.
If any condition to the Underwriters' obligations hereunder to be
fulfilled prior to or at the Closing Date or the relevant Option Closing Date,
as the case may be, is not so fulfilled, the Representatives may terminate this
Agreement or, if the Representatives so elect, it may waive any such conditions
which have not been fulfilled or extend the time for their fulfillment.
7. Indemnification.
(a) The Company agrees to indemnify and hold harmless each of the
Underwriters (for purposes of this Section 7 "Underwriter" shall include the
officers, directors, partners, employees, agents and counsel of the Underwriter,
including specifically each person who may be substituted for an Underwriter as
provided in Section 11 hereof), and each person, if any, who controls the
Underwriter ("controlling person") within the meaning of Section 15 of the Act
or Section 20(a) of the Exchange Act, from and against any and all losses,
claims, damages, expenses or liabilities, joint or several (and actions,
proceedings, investigations, inquiries, and suits in respect thereof),
whatsoever (including but not limited to any and all costs and expenses
whatsoever reasonably incurred in investigating, preparing or defending against
such action, proceeding, investigation, inquiry or suit, commenced or
threatened, or any claim whatsoever), as such are incurred, to which the
Underwriter or such controlling person may become subject under the Act, the
Exchange Act or any other statute or at common law or otherwise or under the
laws of foreign countries, arising out of or based upon (A) any untrue statement
or alleged untrue statement of a material fact contained (i) in any Preliminary
Prospectus, the Registration Statement or the Prospectus (as from time to time
amended and supplemented); (ii) in any post-effective amendment or amendments or
any new registration statement and prospectus in which is included securities of
the Company issued or issuable upon exercise of the Securities; or (iii) in any
application or other document or written communication (in this Section 7
collectively called "application") executed by the Company or based upon written
information furnished by the Company filed, delivered or used in any
jurisdiction in order to qualify the Securities under the securities laws
thereof or filed with the Commission, any state securities commission or agency,
Nasdaq or any other securities exchange, (B) the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary to make
the statements therein not misleading (in the case of the Prospectus, in the
light of the circumstances under which they were made), or (C) any breach of any
representation, warranty, covenant or agreement of the
29
<PAGE> 30
Company contained herein or in any certificate by or on behalf of the Company or
any of its officers delivered pursuant hereto unless, in the case of clause (A)
or (B) above, such statement or omission was made in reliance upon and in
conformity with written information furnished to the Company with respect to any
Underwriter by or on behalf of such Underwriter expressly for use in any
Preliminary Prospectus, the Registration Statement or any Prospectus, or any
amendment thereof or supplement thereto, or in any application, as the case may
be.
The indemnity agreement in this subsection (a) shall be in addition
to any liability which the Company may have at common law or otherwise.
(b) Each of the Underwriters agrees severally, but not jointly, to
indemnify and hold harmless the Company, each of its directors, each of its
officers who has signed the Registration Statement, and each other person, if
any, who controls the Company within the meaning of the Act, to the same extent
as the foregoing indemnity from the Company to the Underwriters but only with
respect to statements or omissions, if any, made in any Preliminary Prospectus,
the Registration Statement or Prospectus or any amendment thereof or supplement
thereto or in any application made in reliance upon, and in strict conformity
with, written information furnished to the Company with respect to any
Underwriter by such Underwriter expressly for use in such Preliminary
Prospectus, the Registration Statement or Prospectus or any amendment thereof or
supplement thereto or in any such application, provided that such written
information or omissions only pertain to disclosures in the Preliminary
Prospectus, the Registration Statement or Prospectus directly relating to the
transactions effected by the Underwriters in connection with this Offering. The
Company acknowledges that the statements with respect to the public offering of
the Securities set forth under the heading "Underwriting" and the stabilization
legend in the Prospectus have been furnished by the Underwriters expressly for
use therein and constitute the only information furnished in writing by or on
behalf of the Underwriters for inclusion in the Prospectus.
The indemnity agreement in this subsection (b) shall be in addition
to any liability which the Underwriters may have at common law or otherwise.
(c) Promptly after receipt by an indemnified party under this
Section 7 of notice of the commencement of any action, suit or proceeding, such
indemnified party shall, if a claim in respect thereof is to be made against one
or more indemnifying parties under this Section 7, notify each party against
whom indemnification is to be sought in writing of the commencement thereof (but
the failure so to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 7 except to the extent that it
has been prejudiced in any material respect by such failure or from any
liability which it may have otherwise). In case any such action, investigation,
inquiry, suit or proceeding is brought against any indemnified party, and it
notifies an indemnifying party or parties of the commencement thereof, the
indemnifying party or parties will be entitled to participate therein, and to
the extent it may elect by written notice delivered to the indemnified party
promptly after receiving the aforesaid notice from such indemnified party, to
assume the defense thereof with counsel reasonably satisfactory to such
indemnified party. Notwithstanding the foregoing, the indemnified party or
parties shall have the right to employ its or their own counsel in any such case
but the fees and expenses of such counsel shall be at the expense of such
indemnified party or parties unless (i) the employment of such counsel shall
have been authorized in writing by the indemnifying parties in connection
30
<PAGE> 31
with the defense of such action at the expense of the indemnifying party, (ii)
the indemnifying parties shall not have employed counsel reasonably satisfactory
to such indemnified party to have charge of the defense of such action within a
reasonable time after notice of commencement of the action, or (iii) such
indemnified party or parties shall have reasonably concluded that there may be
defenses available to it or them which are different from or additional to those
available to one or all of the indemnifying parties (in which case the
indemnifying parties shall not have the right to direct the defense of such
action, investigation, inquiry, suit or proceeding on behalf of the indemnified
party or parties), in any of which events such fees and expenses of one
additional counsel shall be borne by the indemnifying parties. In no event shall
the indemnifying parties be liable for fees and expenses of more than one
counsel (in addition to any local counsel) separate from their own counsel for
all indemnified parties in connection with any one action, investigation,
inquiry, suit or proceeding or separate but similar or related actions,
investigations, inquiries, suits or proceedings in the same jurisdiction arising
out of the same general allegations or circumstances. Anything in this Section 7
to the contrary notwithstanding, an indemnifying party shall not be liable for
any settlement of any claim or action effected without its written consent;
provided, however, that such consent was not unreasonably withheld. An
indemnifying party will not, without the prior written consent of the
indemnified parties, settle compromise or consent to the entry of any judgment
with respect to any pending or threatened claim, action, investigation, inquiry,
suit or proceeding in respect of which indemnification or contribution may be
sought hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action), unless such settlement, compromise or consent
(i) includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act by or on behalf of any indemnified party.
(d) In order to provide for just and equitable contribution in any
case in which (i) an indemnified party makes claim for indemnification pursuant
to this Section 7, but it is judicially determined (by the entry of a final
judgment or decree by a court of competent jurisdiction and the expiration of
time to appeal or the denial of the last right of appeal) that such
indemnification may not be enforced in such case notwithstanding the fact that
the express provisions of this Section 7 provide for indemnification in such
case, or (ii) contribution under the Act may be required on the part of any
indemnified party, then each indemnifying party shall contribute to the amount
paid as a result of such losses, claims, damages, expenses or liabilities (or
actions, investigations, inquiries, suits or proceedings in respect thereof) (A)
in such proportion as is appropriate to reflect the relative benefits received
by each of the contributing parties, on the one hand, and the party to be
indemnified on the other hand, from the offering of the Securities or (B) if the
allocation provided by clause (A) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of each of the
contributing parties, on the one hand, and the party to be indemnified on the
other hand in connection with the statements or omissions that resulted in such
losses, claims, damages, expenses or liabilities, as well as any other relevant
equitable considerations. In any case where the Company is the contributing
party and the Underwriters are the indemnified party, the relative benefits
received by the Company, on the one hand, and the Underwriters, on the other,
shall be deemed to be in the same proportion as the total net proceeds from the
offering of the Securities (before deducting expenses) bear to the total
underwriting discounts received by the Underwriters hereunder, in each case as
set forth in the
31
<PAGE> 32
table on the Cover Page of the Prospectus. Relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company, or by the Underwriters, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The amount paid or payable
by an indemnified party as a result of the losses, claims, damages, expenses or
liabilities (or actions, investigations, inquiries, suits or proceedings in
respect thereof) referred to above in this subdivision (d) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action, claim,
investigation, inquiry, suit or proceeding. Notwithstanding the provisions of
this subdivision (d) the Underwriters shall not be required to contribute any
amount in excess of the underwriting discount applicable to the Securities
purchased by the Underwriters hereunder. No person guilty of fraudulent
misrepresentation (within the meaning of Section11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 7, each person, if any, who
controls the Company within the meaning of the Act, each officer of the Company
who has signed the Registration Statement, and each director of the Company
shall have the same rights to contribution as the Company, subject in each case
to this subparagraph (d). Any party entitled to contribution will, promptly
after receipt of notice of commencement of any action, suit, inquiry,
investigation or proceeding against such party in respect to which a claim for
contribution may be made against another party or parties under this
subparagraph (d), notify such party or parties from whom contribution may be
sought, but the omission so to notify such party or parties shall not relieve
the party or parties from whom contribution may be sought from any obligation it
or they may have hereunder or otherwise than under this subparagraph (d), or to
the extent that such party or parties were not adversely affected by such
omission. The contribution agreement set forth above shall be in addition to any
liabilities which any indemnifying party may have at common law or otherwise.
8. Representations and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement or
contained in certificates of officers of the Company submitted pursuant hereto,
shall be deemed to be representations, warranties and agreements at the Closing
Date and the Option Closing Date, as the case may be, and such representations,
warranties and agreements of the Company and the indemnity agreements contained
in Section 7 hereof, shall remain operative and in full force and effect
regardless of any investigation made by or on behalf of any Underwriter, the
Company, any controlling person of any Underwriter, the Company, and shall
survive termination of this Agreement or the issuance, sale and delivery of the
Securities to the Underwriters and the Representative, as the case may be.
9. Effective Date.
This Agreement shall become effective at 10:00 a.m., New York City
time, on the next full business day following the date hereof, or at such
earlier time after the Registration Statement becomes effective as the
Representative, in its discretion, shall release the Securities for sale to the
public; provided, however, that the provisions of Sections 5, 7 and 10 of this
Agreement shall at all times be effective. For purposes of this Section 9, the
Shares to be purchased hereunder shall be deemed to have been so released upon
the earlier of dispatch by the
32
<PAGE> 33
Representatives of telegrams to securities dealers releasing such shares for
offering or the release by the Representatives for publication of the first
newspaper advertisement which is subsequently published relating to the Shares.
10. Termination.
(a) Subject to subsection (b) of this Section 10, the
Representatives shall have the right to terminate this Agreement, after the date
hereof, (i) if any domestic or international event or act or occurrence has
materially disrupted, or in the Representative' opinion will in the immediate
future materially adversely disrupt the financial markets; or (ii) any material
adverse change in the financial markets shall have occurred; or (iii) if trading
generally shall have been suspended or materially limited on or by, as the case
may be, any of the New York Stock Exchange, the American Stock Exchange, the
National Association of Securities Dealers, Inc., the Boston Stock Exchange, the
Commission or any other government authority having jurisdiction; or (iv) if
trading of any of the securities of the Company shall have been suspended, or
any of the securities of the Company shall have been delisted, on any exchange
or in any over-the-counter market; or (v) if the United States shall have become
involved in a war or major hostilities, or if there shall have been an
escalation in an existing war or major hostilities or a national emergency shall
have been declared in the United States; or (vi) if a banking moratorium has
been declared by a state or federal authority; or (vii) if a moratorium in
foreign exchange trading has been declared; or (viii) if the Company shall have
sustained a loss material or substantial to the Company by fire, flood,
accident, hurricane, earthquake, theft, sabotage or other calamity or malicious
act which, whether or not such loss shall have been insured, will, in the
Representatives' opinion, make it inadvisable to proceed with the delivery of
the Securities; or (viii) if there shall have occurred any outbreak or
escalation of hostilities or any calamity or crisis or there shall have been
such a material adverse change in the conditions or prospects of the Company, or
such material adverse change in the general market, political or economic
conditions, in the United States or elsewhere as in the Representatives'
judgment would make it inadvisable to proceed with the offering, sale and/or
delivery of the Securities or (ix) if Ramen Singh, [________________] or
[__________________] shall no longer serve the Company in their present
capacity.
(b) If this Agreement is terminated by the Representatives in
accordance with the provisions of Section 10(a) the Company shall promptly
reimburse and indemnify the Representatives for its actual out-of-pocket
expenses in an amount not to exceed fifty thousand dollars ($50,000), including
the fees and disbursements of counsel for the Underwriters (less amounts
previously paid pursuant to Section 5(c) above). Notwithstanding any contrary
provision contained in this Agreement, if this Agreement shall not be carried
out within the time specified herein, or any extension thereof granted to the
Representative, by reason of any failure on the part of the Company to perform
any undertaking or satisfy any condition of this Agreement by it to be performed
or satisfied (including, without limitation, pursuant to Section 6 or Section
12) then, the Company shall promptly reimburse and indemnify the Representatives
for all of their actual out-of-pocket expenses, including the fees and
disbursements of counsel for the Underwriters (less amounts previously paid
pursuant to Section 5(c) above). In addition, the Company shall remain liable
for all Blue Sky counsel fees and expenses and filing fees. Notwithstanding any
contrary provision contained in this Agreement, any election hereunder or any
termination of this Agreement (including, without limitation, pursuant to
Sections 6, 10, 11
33
<PAGE> 34
and 12 hereof), and whether or not this Agreement is otherwise carried out, the
provisions of Section 5 and Section 7 shall not be in any way affected by such
election or termination or failure to carry out the terms of this Agreement or
any part hereof.
11. Substitution of the Underwriters. If one or more of the Underwriters
shall fail (otherwise than for a reason sufficient to justify the termination of
this Agreement under the provisions of Section 6, Section 10 or Section 12
hereof) to purchase the Securities which it or they are obligated to purchase on
such date under this Agreement (the "Defaulted Securities"), the Representatives
shall have the right, within 24 hours thereafter, to make arrangement for one or
more of the non-defaulting Underwriters, or any other underwriters, to purchase
all, but not less than all, of the Defaulted Securities in such amounts as may
be agreed upon and upon the terms herein set forth; if, however, the
Representatives shall not have completed such arrangements within such 24-hour
period, then:
(i) if the number of Defaulted Securities does not exceed 10%
of the total number of Firm Shares to be purchased on such date, the
non-defaulting Underwriters shall be obligated to purchase the full
amount thereof in the proportions that their respective underwriting
obligations hereunder bear to the underwriting obligations of all
non-defaulting Underwriters, or
(ii) if the number of Defaulted Securities exceeds 10% of the
total number of Firm Shares, this Agreement shall terminate without
liability on the part of any non-defaulting Underwriters.
No action taken pursuant to this Section shall relieve any
defaulting Underwriter from liability in respect of any default by such
Underwriter under this Agreement.
In the event of any such default which does not result in a
termination of this Agreement, the Representatives shall have the right to
postpone the Closing Date for a period not exceeding seven days in order to
effect any required changes in the Registration Statement or Prospectus or in
any other documents or arrangements.
12. Default by the Company. If the Company shall fail at the Closing Date
or at any Option Closing Date, as applicable, to sell and deliver the number of
Shares which it is obligated to sell hereunder on such date, then this Agreement
shall terminate (or, if such default shall occur with respect to any Option
Shares to be purchased on an Option Closing Date, the Underwriters may at the
Representatives' option, by notice from the Representatives to the Company,
terminate the Underwriters' obligation to purchase Option Shares from the
Company on such date) without any liability on the part of any non-defaulting
party other than pursuant to Section 5, Section 7 and Section 10 hereof. No
action taken pursuant to this Section shall relieve the Company from liability,
if any, in respect of such default.
13. Notices. All notices and communications hereunder, except as herein
otherwise specifically provided, shall be in writing and shall be deemed to have
been duly given if mailed or transmitted by any standard form of
telecommunication. Notices to the Underwriters shall be directed to the
Representatives c/o H.C. Wainwright & Co., Inc. at One Boston Place, 40th Floor,
Boston Massachusetts 02108, Attention: Scott Weisman, with a copy to Orrick,
Herrington &
34
<PAGE> 35
Sutcliffe LLP, 666 Fifth Avenue, New York, New York 10103, Attention: Rubi
Finkelstein, Esq. Notices to the Company shall be directed to the Company at
35th U.S. Highway 19N, Suite 300, Palm Harbor, Florida 34684, Attention: Dr.
Ramen Singh, Chief Executive Officer, with a copy to Frankfurt, Garbus, Klein &
Selz, P.C., 488 Madison Avenue, New York, New York 10022, Attention: Gary A.
Schonwald, Esq.
14. Parties. This Agreement shall inure solely to the benefit of and shall
be binding upon, the Underwriters, the Company, and the controlling persons,
directors and officers referred to in Section 7 hereof, and their respective
successors, legal representatives and assigns, and no other person shall have or
be construed to have any legal or equitable right, remedy or claim under or in
respect of or by virtue of this Agreement or any provisions herein contained. No
purchaser of Securities from any Underwriter shall be deemed to be a successor
by reason merely of such purchase.
15. Construction. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of New York without giving
effect to the choice of law or conflict of laws principles.
16. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, and all of which
taken together shall be deemed to be one and the same instrument.
17. Entire Agreement; Amendments. This Agreement and the Representatives'
Warrant Agreement constitute the entire agreement of the parties hereto and
supersede all prior written or oral agreements, understandings and negotiations
with respect to the subject matter hereof. This Agreement may not be amended
except in a writing, signed by the Representatives and the Company.
35
<PAGE> 36
If the foregoing correctly sets forth the understanding between the
Underwriters and the Company, please so indicate in the space provided below for
that purpose, whereupon this letter shall constitute a binding agreement among
us.
Very truly yours,
Dynacs Inc.
By:_____________________________________
Ramen Singh
President and Chief Executive Officer
Confirmed and accepted as of
the date first above written.
H.C. WAINWRIGHT & CO., INC.
For itself and as Representative
of the Several Underwriters Named
in Schedule A hereto
By: ______________________________
Name:
Title:
ROTH CAPITAL PARTNERS, INC.
For itself and as Representative
of the Several Underwriters Named
in Schedule A hereto
By: ______________________________
Name:
Title:
36
<PAGE> 37
SCHEDULE A
Number of
Underwriter Shares
- --------------------------------------------------------------------------------
H.C. Wainwright & Co., Inc.
Roth Capital Partners, Inc.
TOTAL
<PAGE> 38
Exhibit [_]
[FORM OF INTELLECTUAL PROPERTY OPINION]
___________________, 2000
H.C. WAINWRIGHT & CO., INC.
ROTH CAPITAL PARTNERS, INC.
c/o H.C. Wainwright & Co., Inc.
One Boston Place, 40th Floor
Boston, Massachusetts 0210
Re: Public Offering of Dynacs Inc.
Gentlemen:
We have acted as special patent counsel to Dynacs Inc., a Delaware
corporation (the "Company"), in connection with the entering into by the Company
of that certain Underwriting Agreement by and among H.C. Wainwright & Co., Inc.
("Wainwright") and Roth Capital Partners, Inc., as the representatives of the
several underwriters, and the Company, dated______________, 2000 (the
"Underwriting"). This opinion is provided to you pursuant to Section ____ of the
Underwriting Agreement.
For the purpose of rendering the opinions set forth below we have reviewed
the following (collectively, the "Documents"):
(i) the Underwriting Agreement;
(ii) that certain Registration Statement filed ____________, 2000,
together with any and all amendments thereof and exhibits thereto
(collectively, the "Registration Statement");
(iii) a search of the United States Patent and Trademark Office records
and relevant foreign patent and trademark offices records, relevant
to ownership of any and all:
patents and patent applications (including, without limitation, the
patents and patent applications listed on Schedule A annexed hereto and hereby
incorporated by reference herein (collectively, the "Patents")),
owned, purportedly owned or licensed by the Company (including, those
patents and patent applications licensed, without limitation, pursuant to the
licenses listed on Schedule B annexed hereto and hereby incorporated by
reference herein (collectively, the "Licenses")), conducted by
___________________ and certified as true and correct as of _______, 2000 (no
earlier than 5 days prior to the date of the Closing (as defined in the
Underwriting Agreement));
(iv) an intellectual property litigation search with respect to all
Patents and Licenses listed on Schedules A and B, respectively;
<PAGE> 39
(v) a search of the Uniform Commercial Code ("UCC") recordation offices,
in the following jurisdictions -- [Florida, California and _________________],
with respect to the following two categories of general intangibles:
(a) the intellectual property general intangibles of the Company,
including, without limitation, the Company's patents and patent applications,
inventions, know how, intellectual property licenses and other rights, and
(b) the intellectual property general intangibles licensed to the
Company, including, the patents, patent applications, inventions, know how, and
other intellectual property rights licensed to the Company pursuant to the
Licenses (listed on Schedule B),
said search certified to us as complete and accurate by
____________________ and current through ____________________, 2000 (no earlier
than 5 days prior to the date of the Closing) and said jurisdictions being the
only jurisdictions in which filing of UCC financing statements or other
documents may be filed to effectively evidence a security or other interest in
said general intangibles; and
(vi) any and all records, documents, instruments and agreements in our
possession or under our control relating to the Company.
We have also examined such corporate records, documents, instruments and
agreements, and inquired into such other matters, as we have deemed necessary or
appropriate as a basis for the opinions set forth herein. Whenever our opinion
herein is qualified by the phrase "to the best of our knowledge" or "to the best
of our knowledge, after due inquiry," such language means that, based upon (i)
our inquiries of officers of the Company, (ii) our review of the Documents, and
(iii) our review of such other corporate records, documents, instruments and
agreements described in the first sentence of this paragraph, we believe that
such opinions are factually correct.
To the best of our knowledge, as to all matters of fact represented to you
by the Company, we advise you that nothing has come to our attention that would
cause us to believe that such facts are incorrect, incomplete or misleading or
that reliance thereon is not warranted under the circumstances. We call to your
attention that our opinion is limited to such facts as they exist on the date
hereof and do not take into account any change of circumstances, fact or law
subsequent thereto.
Based upon and subject to the foregoing, we are of the opinion that:
1. To the best of our knowledge, after due inquiry, except as
described in the Registration Statement, the Company owns or has the right to
use, free and clear of all liens, encumbrances, pledges, security interests,
defects or other restrictions or equities of any kind whatsoever,
(i) all patents and patent applications (including, without
limitation, the Patents),
(ii) all intellectual property licenses on Schedule B,
<PAGE> 40
used in, or required for, the conduct of the Company's business.
2. To the best of our knowledge, after due inquiry, the Company
possesses all material intellectual property licenses or rights used in, or
required for, the conduct of its business (including, the Licenses and without
limitation, any such licenses or rights described in the Registration Statement
as being owned, possessed or licensed by the Company, as the case may be) and
such licenses and rights are in full force and effect.
3. To the best of our knowledge, after due inquiry, there is no
claim or action, pending, threatened or potential, which affects or could affect
the rights of the Company with respect to any patents, patent applications or
Licenses used in, or required for, the conduct of the Company's business.
4. To the best of our knowledge, after due inquiry, there is no
intellectual property based claim or action, pending, threatened or potential,
which affects or could affect the rights of the Company with respect to any
products, services, processes or licenses, including, without limitation, the
Patents or the Licenses used in the conduct of the Company's business.
5. To the best of our knowledge, after due inquiry, except as
described in the Registration Statement, the Company is not under any obligation
to pay royalties or fees to any third party with respect to any material,
technology or intellectual properties developed, employed, licensed or used by
the Company.
6. To the best of our knowledge, after due inquiry, the statements
in the Registration Statement relating to the Patents and the Licenses under the
headings, "Risk Factors - " and "Business - _______________________", are
accurate in all material respects, fairly represent the information disclosed
therein and do not omit to state any fact necessary to make the statements made
therein complete and accurate.
7. To the best of our knowledge, after due inquiry, the statements
in the Registration Statement do not contain any untrue statement of a material
fact with respect to the Patents, the Licenses or the intellectual property
underlying the Patents or the Licenses or omit to state any material fact
relating to the Patents, the Licenses or the intellectual property underlying
the Patents or the Licenses which is required to be stated in the Registration
Statement or is necessary to make the statements therein not misleading.
We call your attention to the fact that the members of this firm are
licensed to practice law in the State of ________________ and before the United
States Patent and Trademark Office as Registered Patent Attorneys. Accordingly,
we express no opinion with respect to the laws, rules and regulations of any
jurisdictions other than the State of ________________ and the United States of
America.
The opinions expressed herein are for the sole benefit of, and may be
relied upon only by, the several Underwriters named in Schedule A to the
Underwriting Agreement and Orrick, Herrington & Sutcliffe LLP.
<PAGE> 41
Very truly yours,
<PAGE> 1
Exhibit 3.1
State of Delaware
Office of the Secretary of State
Page 1
------------------------------
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF
DELAWARE, DO HEREBY CERTIFY THE ATTACHED IS A TRUE AND
CORRECT COPY OF THE RESTATED CERTIFICATE OF "DYNACS INC.",
FILED IN THIS OFFICE ON THE THIRTIETH DAY OF NOVEMBER, A.D.
1999, AT 9 O'CLOCK A.M.
A FILED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO
THE NEW CASTLE, COUNTY RECORDER OF DEEDS.
[DELAWARE STATE SEAL]
[SECRETARY OF STATE SEAL] /s/ Edward J. Freel
-----------------------------------
Edward J. Freel, Secretary of State
3097499 8100 AUTHENTICATION: 0109279
991508881 DATE: 12-01-99
<PAGE> 2
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 09:00 AM 11/30/1999
991508881 - 3097499
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
OF
DYNACS INC.
Dynacs Inc., a corporation organized and existing under the laws of the
State of Delaware, hereby certifies as follows:
A. The name of the corporation is Dynacs Inc. (the "Corporation"). The
original Certificate of Incorporation of the Corporation was filed with the
Secretary of State of the State of Delaware on September 15, 1999.
B. This Amended and Restated Certificate of Incorporation of the Corporation
was duly adopted in accordance with the provisions of section 245 of the
General Corporation Law of the State of Delaware and section 242.
C. The text of the Certificate of Incorporation is hereby amended and restated
in its entirety to read as follows:
ARTICLE I
NAME
The name of the corporation is Dynacs Inc. (the "Corporation").
ARTICLE II
REGISTERED OFFICE AND AGENT
The address of the Corporation's registered office in the State of
Delaware is c/o The Prentice-Hall Corporation System, Inc., 1013 Centre Road,
in the City of Wilmington, County of New Castle. The name of the Corporation's
registered agent at such address is The Prentice-Hall Corporation System, Inc.
ARTICLE III
PURPOSE
The purpose of the Corporation is to engage in any lawful act or activity
for which corporations may be organized under the General Corporation Law of
Delaware (the "DGCL").
<PAGE> 3
ARTICLE IV
AUTHORIZED STOCK
The Corporation is authorized to issue two classes of stock, to be
designated Common Stock and Preferred Stock. The total number of shares of
stock which the Corporation has authority to issue shall be twenty million
(20,000,000), of which fifteen million (15,000,000) shares shall be Common
Stock having a par value of $0.01 per share and five million (5,000,000) shares
shall be Preferred Stock having a par value of $0.01 per share.
The shares of Preferred Stock shall be undesignated Preferred Stock and
may be issued from time to time in one or more series pursuant to a resolution
or resolutions, duly adopted by the Board of Directors, providing for such
issue, the authority to do so being hereby expressly vested in the Board of
Directors. The Board of Directors is further authorized to determine or alter
the rights, preferences, privileges and restrictions granted to or imposed upon
any wholly unissued series of Preferred Stock and to fix the number of shares
of any series of Preferred Stock and the designation of any such series of
Preferred Stock. The Board of Directors, within the limits and restrictions
stated in any resolution or resolutions of the Board of Directors originally
fixing the number of shares constituting any series, may increase or decrease
the number of shares of any series subsequent to the issue of shares of that
series, but not below the number of shares in any such series then outstanding.
The authority of the Board of Directors with respect to each such class or
series shall include, without limitation of the foregoing, the right to
determine and fix:
(i) the distinctive designation of such class or series and the number
of shares to constitute such class or series;
(ii) the rate at which dividends on the shares of such class or series
shall be declared and paid, or set aside for payment, whether
dividends at the rate so determined shall be cumulative or accruing,
and whether the shares of such class or series shall be entitled to
any participating or other dividends in addition to dividends at the
rate so determined, and if so, on what terms;
(iii) the right or obligation, if any, of the Corporation to redeem shares
of the particular class or series of Preferred Stock and, if such
shares are redeemable, the price, terms and manner of such
redemption;
(iv) the special and relative rights and preferences, if any, and the
amount or amounts per share which the shares of such class or series
of Preferred Stock shall be entitled to receive upon any voluntary
or involuntary liquidation, dissolution or winding up of the
Corporation;
(v) the terms and conditions, if any, upon which shares of such class or
series shall be
-2-
<PAGE> 4
convertible into, or exchangeable for, shares of capital stock of
any other class or series, including the price or prices or the rate
or rates of conversion or exchange and the terms of adjustment, if
any;
(vi) the obligation, if any, of the Corporation to retire, redeem or
purchase shares of such class or series pursuant to a sinking fund
or fund of a similar nature or otherwise, and the terms and
conditions of such obligation;
(vii) voting rights, if any, on the issuance of additional shares of such
class or series or any shares of any other class or series of
Preferred Stock;
(viii) limitations, if any, on the issuance of additional shares of such
class or series or any shares of any other class or series of
Preferred Stock; and
(xi) such other preferences, powers, qualifications, special or relative
rights and privileges thereof as the Board of Directors of the
Corporation, acting in accordance with this Certificate of
Incorporation, may deem advisable and are not inconsistent with law
and the provisions of this Certificate of Incorporation.
ARTICLE V
ADOPTION, AMENDMENT AND/OR REPEAL OF BY-LAWS
In furtherance and not in limitation of the powers conferred by statute,
the Board of Directors of the Corporation is expressly authorized to make,
alter, amend or repeal the By-Laws of the Corporation; provided, that any
by-laws made, altered or amended by the Board of Directors may be altered,
amended or repealed, and any by-laws may be made, by the stockholders of the
Corporation.
ARTICLE VI
NUMBER OF DIRECTORS; ELECTION
The number of directors which constitutes the whole Board of Directors of
the Corporation shall be as specified in the By-Laws of the Corporation.
Members of the Board of Directors may be elected either by written ballot
or by voice vote.
-3-
<PAGE> 5
ARTICLE VII
LOCATION OF STOCKHOLDER MEETINGS AND CORPORATE RECORDS
Meetings of stockholders may be held within or without the State of
Delaware, as the By-Laws may provide. The books of the Corporation may be kept,
subject to any provisions contained in the DGCL, outside the State of Delaware
at such place or places as may be designated from time to time by the Board of
Directors or in the By-Laws of the Corporation.
ARTICLE VIII
NO CUMULATIVE VOTING
Holders of stock of any class or series of the Corporation shall not be
entitled to cumulate their votes for the election of directors or any other
matter submitted to a vote of the stockholders.
ARTICLE IX
PERSONAL LIABILITY OF DIRECTORS
To the fullest extent permitted by the DGCL, a director of the Corporation
shall not be personally liable to the Corporation or its stockholders for
monetary damages for breach of fiduciary duty as a director. Neither any
amendment nor repeal of this Article IX nor the adoption of any provision of
this Certificate of Incorporation inconsistent with this Article IX, shall
eliminate or reduce the effect of this Article IX in respect of any matter
occurring, or any cause of action, suit or claim that, but for this Article IX,
would accrue or arise, prior to such amendment, repeal or adoption of an
inconsistent provision.
ARTICLE X
INDEMNIFICATION AND ADVANCEMENT OF EXPENSES
The Corporation shall indemnify each of the Corporation's directors and
officers in each and every situation where, under section 145 of the DGCL, as
amended from time to time ("Section 145"), the Corporation is permitted or
empowered to make such indemnification. The Corporation may, in the sole
discretion of its Board of Directors, indemnify any other person who may be
indemnified pursuant to Section 145 to the extent the Board of Directors deems
advisable, as permitted by Section 145. The Corporation shall promptly make or
cause to be made any determination required to be made pursuant to Section 145.
The right of indemnification conferred in this Article X shall be a
contract right and shall include the right of the Corporation's officers and
directors to be paid by the Corporation the
-4-
<PAGE> 6
expenses incurred in defending any action, suit or proceeding for which
indemnification is permitted by Section 145 in advance of the final disposition
thereof, provided that the payment of such expenses is permitted by, and
otherwise made in accordance with, the provisions of the DGCL.
The rights conferred on any person by this Article shall not be exclusive
of any other rights which such person may have or hereafter acquire under any
statute, provision of this Certificate of Incorporation, the Corporation's
By-Laws, any agreement, vote of stockholders or disinterested directors or
otherwise.
Any repeal of modification of the foregoing provisions of this Article
shall not adversely affect any right or protection hereunder of any person in
respect of any act or omission occurring prior to the time of such repeal or
modification.
ARTICLE XI
COMPROMISE AND ARRANGEMENTS
Whenever a compromise or arrangement is proposed between the Corporation
and its creditors or any class of them and/or between the Corporation and its
stockholders or any class of them, any court of equitable jurisdiction within
the State of Delaware may, on the application in a summary way of the
Corporation or of any creditor or stockholder thereof or on the application of
any receiver or receivers appointed for the Corporation under the provisions of
section 291 of Title 8 of the Delaware Code or on the application of trustees in
dissolution or of any receivers appointed for the Corporation under the
provisions of section 279 of Title 8 of the Delaware Code order a meeting of the
creditors, and/or of the stockholders or class of stockholders of the
Corporation, as the case may be, to be summoned in such manner as the said
court directs. If a majority in number representing three-fourths in value of
the creditors or class of creditors, and/or of the stockholders or class of
stockholders of this Corporation, as the case may be, agree to any compromise
or arrangement and to any reorganization of this Corporation as a consequence
of such compromise or arrangement, such compromise or arrangement and such
reorganization shall, if sanctioned by the court to which the said application
has been made, be binding on all the creditors or class of creditors, and/or on
all the stockholders or class of stockholders, of the Corporation, as the case
may be, and also on the Corporation.
ARTICLE XII
AMENDMENT AND REPEAL OF CERTIFICATE OF INCORPORATION
The Corporation reserves the right to amend, alter, change or repeal any
provisions contained in this Certificate of Incorporation, in the manner now or
hereafter prescribed by statute, and all rights conferred upon stockholders
herein are granted subject to this reservation.
-5-
<PAGE> 7
IN WITNESS WHEREOF, this Amended and Restated Certificate of Incorporation
has been signed on this 29th day of November, 1999, and the signature of the
undersigned shall constitute the affirmation and acknowledgment of the
undersigned, under penalties of perjury, that this Certificate is the true act
and deed of the undersigned and that the facts state in this Certificate are
true.
DYNACS INC.
By: /s/ Gary A. Schonwald
_______________________________
Gary A. Schonwald
Assistant Secretary
-6-
<PAGE> 1
Exhibit 4.1
================================================================================
NUMBER Dynacs [LOGO] SHARES
DY
DYNACS INC.
INCORPORATED UNDER THE LAWS SEE REVERSE FOR CERTAIN DEFINITIONS
OF THE STATE OF DELAWARE CUSIP 267798 10 6
- --------------------------------------------------------------------------------
THIS CERTIFIES THAT
is the owner of
- --------------------------------------------------------------------------------
FULLY PAID AND NON-ASSESSABLE SHARES OF COMMON STOCK,
PAR VALUE $.01 PER SHARE, OF
====================================DYNACS INC.=================================
transferable on the books of the Corporation by the holder hereof in person or
by duly authorized Attorney upon surrender of this Certificate properly
endorsed.
This certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.
WITNESS the facsimile seal of the Corporation and the facsimile signatures of
its duly authorized officers.
AUTHORIZED SIGNATURE
Dated: DYNACS INC
CORPORATE
/s/ Harry W. Schubele III SEAL /s/ R P Singh
1999
TREASURER DELAWARE PRESIDENT
[SEAL]
COUNTERSIGNED AND REGISTERED:
CONTINENTAL STOCK TRANSFER & TRUST COMPANY
TRANSFER AGENT AND REGISTRAR
BY
AUTHORIZED SIGNATURE
<PAGE> 2
DYNACS INC.
The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common UNIF GIFT MIN ACT --_______ Custodian
TEN ENT -- as tenants by the entireties (Cust)
JT TEN -- as joint tenants with right of _________ under Uniform Gifts
survivorship and not as tenants (Minor)
in common to Minors Act_________________
(State)
Additional abbreviations may also be used though not in the above list.
For value received,_______________________hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
- --------------------------------------
- --------------------------------------
________________________________________________________________________________
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)
________________________________________________________________________________
________________________________________________________________________________
_________________________________________________________________________ shares
of the Common Stock represented by the within Certificate, and do hereby
irrevocably constitute and appoint
______________________________________________________________________Attorney
to transfer the said stock on the books of the within named Company with full
power of substitution in the premises.
Dated_______________________________________
________________________________________________________
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND
WITH THE NAME AS WRITTEN UPON THE FACE OF THE
CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION
OR ENLARGEMENT OR ANY CHANGE WHATEVER.
Signature(s) Guaranteed:
_______________________________________________________
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE
GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS
AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP
IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM),
PURSUANT TO SEC RULE 17Ad-15.
<PAGE> 1
Exhibit 4.3
[FORM OF REPRESENTATIVE'S WARRANT AGREEMENT[
[SUBJECT TO ADDITIONAL REVIEW]
- --------------------------------------------------------------------------------
DYNACS INC.
AND
H.C. WAINWRIGHT & CO., INC.
AND
ROTH CAPITAL PARTNERS, INC.
REPRESENTATIVES'
WARRANT AGREEMENT
Dated as of ______________, 2000
- --------------------------------------------------------------------------------
<PAGE> 2
REPRESENTATIVE'S WARRANT AGREEMENT dated as of ______________, 2000
by and among DYNACS INC., a Delaware corporation (the "Company"), H.C.
WAINWRIGHT & CO., INC. and ROTH CAPITAL PARTNERS, INC. (hereinafter referred to
as the "Holders" or the "Representatives").
W I T N E S S E T H:
WHEREAS, the Company proposes to issue to the Representatives or its
designees warrants ("Warrants") to purchase up to an aggregate 2,500,000 shares
of common stock, par value $0.01 per share, of the Company ("Common Stock"); and
WHEREAS, the Representatives have agreed pursuant to the
underwriting agreement (the "Underwriting Agreement") dated as of the date
hereof among H.C. Wainwright & Co., Inc. and Roth Capital Partners, Inc., as the
Representatives of the several Underwriters named in Schedule A thereto, and the
Company to act as the Representatives in connection with the Company's proposed
public offering of up to 2,500,000 shares of Common Stock at a public offering
price of $[______] per share of Common Stock (the "Public Offering"); and
WHEREAS, the Warrants to be issued pursuant to this Agreement will
be issued on the Closing Date (as such term is defined in the Underwriting
Agreement) by the Company to the Representatives in consideration for, and as
part of the Representative's compensation in connection with, the
Representatives acting as the Representatives pursuant to the Underwriting
Agreement;
NOW, THEREFORE, in consideration of the premises, the payment by the
Representatives to the Company of an aggregate of twenty-five dollars ($25.00),
the agreements herein set forth and other good and valuable consideration,
hereby acknowledged, the parties hereto agree as follows:
<PAGE> 3
SECTION 1. Grant. The Representatives are hereby granted the right
to purchase, at any time from ___________, 2001 [one year from the date hereof],
until 5:30 P.M., New York time, on ______________, 2005 [five years from the
effective date of the registration statement], up to an aggregate of 250,000
shares of Common Stock (the "Shares") at an initial exercise price (subject to
adjustment as provided in Section 8 hereof) of $[_____] per share [120% of the
public offering price per share] of Common Stock subject to the terms and
conditions of this Agreement. Except as set forth herein, the Shares issuable
upon exercise of the Warrants are in all respects identical to the shares of
Common Stock being purchased by the Underwriters for resale to the public
pursuant to the terms and provisions of the Underwriting Agreement.
SECTION 2. Warrant Certificates. The warrant certificates (the
"Warrant Certificates") delivered and to be delivered pursuant to this Agreement
shall be in the form set forth in Exhibit A, attached hereto and made a part
hereof, with such appropriate insertions, omissions, substitutions, and other
variations as required or permitted by this Agreement.
SECTION 3. Exercise of Warrant.
Section 3.1 Method of Exercise. The Warrants initially are
exercisable at an aggregate initial exercise price (subject to adjustment as
provided in Section 8 hereof) per share of Common Stock set forth in Section 6
hereof payable by certified or official bank check in New York Clearing House
funds. Upon surrender of a Warrant Certificate with the annexed Form of Election
to Purchase duly executed, together with payment of the Exercise Price (as
hereinafter defined) for the shares of Common Stock purchased at the Company's
principal offices in Palm Harbor, Florida (presently located at 3511 US Highway
19N, Suite 300, Palm Harbor, Florida 34684) the registered holder of a Warrant
Certificate ("Holder" or "Holders") shall be entitled to receive a certificate
or certificates for the shares of Common Stock so purchased. The purchase rights
represented by each Warrant Certificate are exercisable at the option of the
Holder thereof, in whole or in part (but not as to fractional shares of the
Common
2
<PAGE> 4
Stock underlying the Warrants). Warrants may be exercised to purchase all or
part of the shares of Common Stock represented thereby. In the case of the
purchase of less than all the shares of Common Stock purchasable under any
Warrant Certificate, the Company shall cancel said Warrant Certificate upon the
surrender thereof and shall execute and deliver a new Warrant Certificate of
like tenor for the balance of the shares of Common Stock purchasable thereunder.
Section 3.2 Exercise by Surrender of Warrant. In addition to
the method of payment set forth in Section 3.1 and in lieu of any cash payment
required thereunder, the Holders of the Warrants shall have the right at any
time and from time to time to exercise the Warrants in full or in part by
surrendering the Warrant Certificate in the manner specified in Section 3.1 in
exchange for the number of Shares equal to the product of (x) the number of
Shares as to which the Warrants are being exercised multiplied by (y) a
fraction, the numerator of which is the Market Price (as defined in Section 3.3
below) of the Shares less the Exercise Price and the denominator of which is
such Market Price. Solely for the purposes of this paragraph, Market Price shall
be calculated either (i) on the date which the form of election attached hereto
is deemed to have been sent to the Company pursuant to Section 13 hereof
("Notice Date") or (ii) as the average of the Market Prices for each of the five
trading days preceding the Notice Date, whichever of (i) or (ii) is greater.
Section 3.3 Definition of Market Price. As used herein, the
phrase "Market Price" at any date shall be deemed to be the last reported sale
price, or, in case no such reported sale takes place on such day, the average of
the last reported sale prices for the last three (3) trading days, in either
case as officially reported by the principal securities exchange on which the
Common Stock is listed or admitted to trading or by the Nasdaq National Market
or Nasdaq SmallCap market (as the case may be "Nasdaq"), or, if the Common Stock
is not listed or admitted to trading on any national securities exchange or
quoted by Nasdaq, the average closing bid price as furnished by the NASD through
Nasdaq or similar organization if Nasdaq is no longer reporting such
information, or if the Common Stock is not quoted on Nasdaq, as
3
<PAGE> 5
determined in good faith by resolution of the Board of Directors of the Company,
based on the best information available to it.
SECTION 4. Issuance of Certificates. Upon the exercise of the
Warrants, the issuance of certificates for shares of Common Stock and/or other
securities, properties or rights underlying such Warrants, shall be made
forthwith (and in any event within five (5) business days thereafter) without
charge to the Holders thereof including, without limitation, any tax which may
be payable in respect of the issuance thereof, and such certificates shall
(subject to the provisions of Sections 5 and 7 hereof) be issued in the name of,
or in such names as may be directed by, the Holders thereof; provided, however,
that the Company shall not be required to pay any tax which may be payable in
respect of any transfer involved in the issuance and delivery of any such
certificates in a name other than that of the Holders, and the Company shall not
be required to issue or deliver such certificates unless or until the person or
persons requesting the issuance thereof shall have paid to the Company the
amount of such tax or shall have established to the satisfaction of the Company
that such tax has been paid.
The Warrant Certificates and the certificates representing the
Shares underlying the Warrants (and/or other securities, property or rights
issuable upon the exercise of the Warrants) shall be executed on behalf of the
Company by the manual or facsimile signature of the then Chairman or Vice
Chairman of the Board of Directors or President or Vice President of the
Company. Warrant Certificates shall be dated the date of execution by the
Company upon initial issuance, division, exchange, substitution or transfer.
SECTION 5. Restriction On Transfer of Warrants. The Holders of a
Warrant Certificate, by its acceptance thereof, covenants and agrees that the
Warrants are being acquired as an investment and not with a view to the
distribution thereof; that the Warrants may not be sold, transferred, assigned,
hypothecated or otherwise disposed of, in whole or in part, for a period of one
(1) year from the date hereof, except to officers of the Representatives.
4
<PAGE> 6
SECTION 6. Exercise Price.
Section 6.1 Initial and Adjusted Exercise Price. Except as
otherwise provided in Section 8 hereof, the initial exercise price of each
Warrant shall be $[____] per share [120% of the public offering price per share]
of Common Stock. The adjusted exercise price shall be the price which shall
result from time to time from any and all adjustments of the initial exercise
price in accordance with the provisions of Section 8 hereof.
Section 6.2 Exercise Price. The term "Exercise Price" herein
shall mean the initial exercise price or the adjusted exercise price, depending
upon the context.
SECTION 7. Registration Rights.
Section 7.1 Registration Under the Securities Act of 1933.
None of the Warrants, the Shares, and any other securities issuable upon
exercise of the Warrants have been registered under the Securities Act of 1933,
as amended (the "Act"), pursuant to the Company's Registration Statement on Form
S-1 (Registration No. _________) (the "Registration Statement"). All of the
representations and warranties of the Company contained in the Underwriting
Agreement relating to the Registration Statement, the Preliminary Prospectus and
Prospectus (as such terms are defined in the Underwriting Agreement) and made as
of the dates provided therein, are hereby incorporated by reference.
Accordingly, the Warrants, certificates representing the Shares underlying the
Warrants, and any of the other securities issuable upon exercise of the Warrants
(collectively, the "Warrant Securities") shall bear the following legend:
The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended
("Act"), and may not be offered or sold except pursuant to (i)
an effective registration statement under the Act, (ii) to the
extent applicable, Rule 144 under the Act (or any similar rule
under such Act relating to the disposition of securities), or
(iii) an opinion of counsel, if such opinion shall be
reasonably satisfactory to counsel to
5
<PAGE> 7
the issuer, that an exemption from registration under such Act
is available.
Section 7.2 Piggyback Registration. If, at any time commencing
after the date hereof and expiring six (6) years from the date hereof, the
Company proposes to register any of its securities under the Act (other than in
connection with a merger or pursuant to Forms S-4 or S-8) it will give written
notice by registered mail, at least thirty (30) days prior to the filing of each
such registration statement, to the Representatives and to all other Holders of
the Warrants and/or the Warrant Securities of its intention to do so. If the
Representatives or other Holders of the Warrants and/or Warrant Securities
notify the Company within twenty (20) days after receipt of any such notice of
its or their desire to include any such securities in such proposed registration
statement, the Company shall afford the Representatives and such Holders of the
Warrants and/or Warrant Securities the opportunity to have any such Warrant
Securities registered under such registration statement (sometimes referred to
herein as the "Piggyback Registration").
Notwithstanding the provisions of this Section 7.2, the Company
shall have the right at any time after it shall have given written notice
pursuant to this Section 7.2 (irrespective of whether a written request for
inclusion of any such securities shall have been made) to elect not to file any
such proposed registration statement, or to withdraw the same after the filing
but prior to the effective date thereof.
Section 7.3 Demand Registration.
(a) At any time commencing after the date hereof and expiring
five (5) years from the effective date of the Public Offering, the Holders of
the Warrants and/or Warrant Securities representing a "Majority" (as hereinafter
defined) of such securities (assuming the exercise of all of the Warrants) shall
have the right (which right is in addition to the registration rights under
Section 7.2 hereof), exercisable by written notice to the Company, to have the
Company prepare and file with the Securities and Exchange Commission (the
"Commission"),
6
<PAGE> 8
on one occasion, a registration statement and such other documents, including a
prospectus, as may be necessary in the opinion of both counsel for the Company
and counsel for the Representatives and Holders, in order to comply with the
provisions of the Act, so as to permit a public offering and sale of their
respective Warrant Securities for nine (9) consecutive months by such Holders
and any other Holders of the Warrants and/or Warrant Securities who notify the
Company within ten (10) days after receiving notice from the Company of such
request.
(b) In addition to the registration rights under Section 7.2
hereof and subsection (a) of this Section 7.3, at any time commencing after the
date hereof and expiring five (5) years after the effective date of the Public
Offering, any Holder of Warrants and/or Warrant Securities shall have the right,
exercisable by written request to the Company, to have the Company prepare and
file, on one occasion, with the Commission a registration statement so as to
permit a public offering and sale for nine (9) consecutive months by any such
Holder of its Warrant Securities, provided, however, that the provisions of
Section 7.4(b) hereof shall not apply to any such registration request and
registration and all costs incident thereto shall be at the expense of the
Holder or Holders making such request.
(c) The Company covenants and agrees to give written notice of
any registration request under this Section 7.3 by any Holder or Holders to all
other registered Holders of the Warrants and the Warrant Securities within ten
(10) days from the date of the receipt of any such registration request.
Section 7.4 Covenants of the Company With Respect to
Registration. In connection with any registration under Section 7.2 or 7.3
hereof, the Company covenants and agrees as follows:
(a) The Company shall use its best efforts to file a
registration statement within forty-five (45) days of receipt of any demand
therefor, shall use its best efforts to have any registration statements
declared effective at the earliest possible time, and shall
7
<PAGE> 9
furnish each Holder desiring to sell Warrant Securities such number of
prospectuses as shall reasonably be requested.
(b) The Company shall pay all costs (excluding fees and
expenses of Holders' counsel, filing fees and any underwriting or selling
commissions), fees and expenses in connection with all registration statements
filed pursuant to Section 7.2 and 7.3(a) hereof including, without limitation,
the Company's legal and accounting fees, printing expenses and blue sky fees and
expenses. The Holders shall pay all costs, fees and expenses in connection with
any registration statement filed pursuant to Section 7.3(b) hereof. If the
Company shall fail to comply with the provisions of Section 7.4, the Company
shall, in addition to any other equitable or other relief available to the
Holders, be liable for any or all incidental or special damages sustained by the
Holders requesting registration of their Warrant Securities.
(c) The Company will take all necessary action which may be
required in qualifying or registering the Warrant Securities included in a
registration statement for offering and sale under the securities or blue sky
laws of such states as reasonably are requested by the Holders, provided that
the Company shall not be obligated to execute or file any general consent to
service of process or to qualify as a foreign corporation to do business under
the laws of any such jurisdiction.
(d) The Company shall indemnify the Holders of the Warrant
Securities to be sold pursuant to any registration statement and each person, if
any, who controls such Holders within the meaning of Section 15 of the Act or
Section 20(a) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), against all loss, claim, damage, expense or liability (including all
expenses reasonably incurred in investigating, preparing or defending against
any claim whatsoever) to which any of them may become subject under the Act, the
Exchange Act or otherwise, arising from such registration statement but only to
the same extent and with the same effect as the provisions pursuant to which the
Company has
8
<PAGE> 10
agreed to indemnify each of the Underwriters contained in Section 7 of the
Underwriting Agreement.
(e) The Holders of the Warrant Securities to be sold pursuant
to a registration statement, and their successors and assigns, shall severally,
and not jointly, indemnify the Company, its officers and directors and each
person, if any, who controls the Company within the meaning of Section 15 of the
Act or Section 20(a) of the Exchange Act, against all loss, claim, damage or
expense or liability (including all expenses reasonably incurred in
investigating, preparing or defending against any claim whatsoever) to which
they may become subject under the Act, the Exchange Act or otherwise, arising
from information furnished by or on behalf of such Holders, or their successors
or assigns, for specific inclusion in such registration statement to the same
extent and with the same effect as the provisions contained in Section 7 of the
Underwriting Agreement pursuant to which the Underwriters have agreed to
indemnify the Company.
(f) Nothing contained in this Agreement shall be construed as
requiring the Holders to exercise their Warrants prior to the initial filing of
any registration statement or the effectiveness thereof.
(g) The Company shall not permit the inclusion of any
securities other than the Warrant Securities to be included in any registration
statement filed pursuant to Section 7.3 hereof, or permit any other registration
statement to be or remain effective during the effectiveness of a registration
statement filed pursuant to Section 7.3 hereof, without the prior written
consent of the Holders of the Warrants and Warrant Securities representing a
Majority of such securities.
(h) The Company shall furnish to each Holder participating in
the offering and to each underwriter, if any, a signed counterpart, addressed to
such Holder or underwriter, of (i) an opinion of counsel to the Company, dated
the effective date of such
9
<PAGE> 11
registration statement (and, if such registration includes an underwritten
public offering, an opinion dated the date of the closing under the underwriting
agreement), and (ii) a "cold comfort" letter dated the effective date of such
registration statement (and, if such registration includes an underwritten
public offering, a letter dated the date of the closing under the underwriting
agreement) signed by the independent public accountants who have issued a report
on the Company's financial statements included in such registration statement,
in each case covering substantially the same matters with respect to such
registration statement (and the prospectus included therein) and, in the case of
such accountants' letter, with respect to events subsequent to the date of such
financial statements, as are customarily covered in opinions of issuer's counsel
and in accountants' letters delivered to underwriters in underwritten public
offerings of securities.
(i) The Company shall, as soon as practicable after the
effective date of the registration statement, and in any event within 15 months
thereafter, make "generally available to its security holders" (within the
meaning of Rule 158 under the Act) an earnings statement (which need not be
audited) complying with Section 11(a) of the Act and covering a period of at
least 12 consecutive months beginning after the effective date of the
registration statement. The Company shall deliver promptly to each Holder
participating in the offering requesting the correspondence described below and
to the managing underwriters, copies of all correspondence between the
Commission and the Company, its counsel or auditors with respect to the
registration statement and permit each Holder and underwriter to do such
investigation, upon reasonable advance notice, with respect to information
contained in or omitted from the registration statement as it deems reasonably
necessary to comply with applicable securities laws or rules of the National
Association of Securities Dealers, Inc. ("NASD"). Such investigation shall
include access to books, records and properties and opportunities to discuss the
business of the Company with its officers and independent auditors, all to such
reasonable extent and at such reasonable times and as often as any such Holder
or underwriter shall reasonably request.
10
<PAGE> 12
(j) The Company shall enter into an underwriting agreement
with the managing underwriters selected for such underwriting by Holders holding
a Majority of the Warrant Securities requested to be included in such
underwriting, which may be the Representatives. Such agreement shall be
satisfactory in form and substance to the Company, each Holder and such managing
underwriter(s), and shall contain such representations, warranties and covenants
by the Company and such other terms as are customarily contained in agreements
of that type used by the managing underwriter(s). The Holders shall be parties
to any underwriting agreement relating to an underwritten sale of their Warrant
Securities and may, at their option, require that any or all the
representations, warranties and covenants of the Company to or for the benefit
of such underwriter(s) shall also be made to and for the benefit of such
Holders. Such Holders shall not be required to make any representations or
warranties to or agreements with the Company or the underwriter(s) except as are
customarily made by selling securityholders in underwritten offerings.
(k) In addition to the Warrant Securities, upon the written
request therefor by any Holders, the Company shall include in the registration
statement any other securities of the Company held by such Holders as of the
date of filing of such registration statement, including without limitation
restricted shares of Common Stock, options, warrants or any other securities
convertible into shares of Common Stock.
(l) For purposes of this Agreement, the term "Majority" in
reference to the Holders of Warrants or Warrant Securities, shall mean in excess
of fifty percent (50%) of the then outstanding Warrants or Warrant Securities
that (i) are not held by the Company, an affiliate, officer, creditor, employee
or agent thereof or any of their respective affiliates, members of their family,
persons acting as nominees or in conjunction therewith and (ii) have not been
resold to the public pursuant to a registration statement filed with the
Commission under the Act.
11
<PAGE> 13
SECTION 8. Adjustments to Exercise Price and Number of Securities.
Section 8.1 Subdivision and Combination. In case the Company
shall at any time subdivide or combine the outstanding shares of Common Stock,
the Exercise Price shall forthwith be proportionately decreased in the case of
subdivision or increased in the case of combination.
Section 8.2 Stock Dividends and Distributions. In case the
Company shall pay a dividend in, or make a distribution of, shares of Common
Stock or of the Company's capital stock convertible into Common Stock, the
Exercise Price shall forthwith be proportionately decreased. An adjustment made
pursuant to this Section 8.2 shall be made as of the record date for the subject
stock dividend or distribution.
Section 8.3 Adjustment in Number of Securities. Upon each
adjustment of the Exercise Price pursuant to the provisions of this Section 8,
the number of Warrant Securities issuable upon the exercise at the adjusted
exercise price of each Warrant shall be adjusted to the nearest whole number by
multiplying a number equal to the Exercise Price in effect immediately prior to
such adjustment by the number of Warrant Securities issuable upon exercise of
the Warrants immediately prior to such adjustment and dividing the product so
obtained by the adjusted Exercise Price.
Section 8.4 Definition of Common Stock. For the purpose of
this Agreement, the term "Common Stock" shall mean (i) the class of stock
designated as Common Stock in the Articles of Incorporation of the Company as
may be amended as of the date hereof, or (ii) any other class of stock resulting
from successive changes or reclassifications of such Common Stock consisting
solely of changes in par value, or from par value to no par value, or from no
par value to par value.
12
<PAGE> 14
Section 8.5 Merger or Consolidation. In case of any
consolidation of the Company with, or merger of the Company with, or merger of
the Company into, another corporation (other than a consolidation or merger
which does not result in any reclassification or change of the outstanding
Common Stock), the corporation formed by such consolidation or merger shall
execute and deliver to the Holders a supplemental warrant agreement providing
that the holder of each Warrant then outstanding or to be outstanding shall have
the right thereafter (until the expiration of such Warrant) to receive, upon
exercise of such Warrant, the kind and amount of shares of stock and other
securities and property receivable upon such consolidation or merger, by a
holder of the number of shares of Common Stock of the Company for which such
Warrant might have been exercised immediately prior to such consolidation,
merger, sale or transfer. Such supplemental warrant agreement shall provide for
adjustments which shall be identical to the adjustments provided in this Section
8. The above provision of this subsection shall similarly apply to successive
consolidations or mergers.
Section 8.6 No Adjustment of Exercise Price in Certain Cases.
No adjustment of the Exercise Price shall be made:
Upon the issuance or sale of the Warrants or the shares
of Common Stock issuable upon the exercise of the Warrants;
If the amount of said adjustment shall be less than two
cents (2(cent)) per Warrant Security, provided, however, that in
such case any adjustment that would otherwise be required then to be
made shall be carried forward and shall be made at the time of and
together with the next subsequent adjustment which, together with
any adjustment so carried forward, shall amount to at least two
cents (2(cent)) per Warrant Security.
SECTION 9. Exchange and Replacement of Warrant Certificates. Each
Warrant Certificate is exchangeable without expense, upon the surrender thereof
by the
13
<PAGE> 15
registered Holders at the principal executive office of the Company, for a new
Warrant Certificate of like tenor and date representing in the aggregate the
right to purchase the same number of Warrant Securities in such denominations as
shall be designated by the Holders thereof at the time of such surrender.
Upon receipt by the Company of evidence reasonably satisfactory to
it of the loss, theft, destruction or mutilation of any Warrant Certificate,
and, in case of loss, theft or destruction, of indemnity or security reasonably
satisfactory to it, and reimbursement to the Company of all reasonable expenses
incidental thereto, and upon surrender and cancellation of the Warrants, if
mutilated, the Company will make and deliver a new Warrant Certificate of like
tenor, in lieu thereof.
SECTION 10. Elimination of Fractional Interests. The Company shall
not be required to issue certificates representing fractions of shares of Common
Stock upon the exercise of the Warrants, nor shall it be required to issue scrip
or pay cash in lieu of fractional interests, it being the intent of the parties
that all fractional interests shall be eliminated by rounding any fraction up to
the nearest whole number of shares of Common Stock or other securities,
properties or rights.
SECTION 11. Reservation and Listing of Securities. The Company shall
at all times reserve and keep available out of its authorized shares of Common
Stock, solely for the purpose of issuance upon the exercise of the Warrants,
such number of shares of Common Stock or other securities, properties or rights
as shall be issuable upon the exercise thereof. The Company covenants and agrees
that, upon exercise of the Warrants and payment of the Exercise Price therefor,
all shares of Common Stock and other securities issuable upon such exercise
shall be duly and validly issued, fully paid, non-assessable and not subject to
the preemptive rights of any stockholder. As long as the Warrants shall be
outstanding, the Company shall use its best efforts to cause all shares of
Common Stock issuable upon the exercise of the Warrants to be
14
<PAGE> 16
listed (subject to official notice of issuance) on all securities exchanges on
which the Common Stock issued to the public in connection herewith may then be
listed and/or quoted.
SECTION 12. Notices to Warrant Holders. Nothing contained in this
Agreement shall be construed as conferring upon the Holders the right to vote or
to consent or to receive notice as a stockholder in respect of any meetings of
stockholders for the election of directors or any other matter, or as having any
rights whatsoever as a stockholder of the Company. If, however, at any time
prior to the expiration of the Warrants and their exercise, any of the following
events shall occur:
(i) the Company shall take a record of the holders of its
shares of Common Stock for the purpose of entitling them to receive
a dividend or distribution payable otherwise than in cash, or a cash
dividend or distribution payable otherwise than out of current or
retained earnings, as indicated by the accounting treatment of such
dividend or distribution on the books of the Company; or
(ii) the Company shall offer to all the holders of its Common
Stock any additional shares of capital stock of the Company or
securities convertible into or exchangeable for shares of capital
stock of the Company, or any option, right or warrant to subscribe
therefor; or
(iii) a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation or merger) or a sale
of all or substantially all of its property, assets and business as
an entirety shall be proposed;
then, in any one or more of said events, the Company shall give written notice
of such event at least fifteen (15) days prior to the date fixed as a record
date or the date of closing the transfer books for the determination of the
stockholders entitled to such dividend, distribution,
15
<PAGE> 17
convertible or exchangeable securities or subscription rights, or entitled to
vote on such proposed dissolution, liquidation, winding up or sale. Such notice
shall specify such record date or the date of closing the transfer books, as the
case may be. Failure to give such notice or any defect therein shall not affect
the validity of any action taken in connection with the declaration or payment
of any such dividend, or the issuance of any convertible or exchangeable
securities, or subscription rights, options or warrants, or any proposed
dissolution, liquidation, winding up or sale.
SECTION 13. Notices.
All notices, requests, consents and other communications hereunder
shall be in writing and shall be deemed to have been duly made and sent when
delivered, or mailed by registered or certified mail, return receipt requested:
(i) If to the registered Holders of the Warrants, to the
address of such Holders as shown on the books of the Company; or
(ii) If to the Company, to the address set forth in Section 3
hereof or to such other address as the Company may designate by
notice to the Holders.
SECTION 14. Supplements and Amendments. The Company and the
Representatives may from time to time supplement or amend this Agreement without
the approval of any Holders of Warrant Certificates (other than the
Representative) in order to cure any ambiguity, to correct or supplement any
provision contained herein which may be defective or inconsistent with any
provisions herein, or to make any other provisions in regard to matters or
questions arising hereunder which the Company and the Representatives may deem
necessary or desirable and which the Company and the Representatives deem shall
not adversely affect the interests of the Holders of Warrant Certificates.
16
<PAGE> 18
SECTION 15. Successors. All the covenants and provisions of this
Agreement shall be binding upon and inure to the benefit of the Company, the
Holders and their respective successors and assigns hereunder.
SECTION 16. Termination. This Agreement shall terminate at the close
of business on ______________, 2005. Notwithstanding the foregoing, the
indemnification provisions of Section 7 shall survive such termination until the
close of business on ______________, 2011.
SECTION 17. Governing Law; Submission to Jurisdiction. This
Agreement and each Warrant Certificate issued hereunder shall be deemed to be a
contract made under the laws of the State of New York and for all purposes shall
be construed in accordance with the laws of said State without giving effect to
the rules of said State governing the conflicts of laws.
The Company, the Representatives and the Holders hereby agree that
any action, proceeding or claim against it arising out of, or relating in any
way to, this Agreement shall be brought and enforced in the courts of the State
of New York or of the United States of America for the Southern District of New
York, and irrevocably submits to such jurisdiction, which jurisdiction shall be
exclusive. The Company, the Representatives and the Holders hereby irrevocably
waive any objection to such exclusive jurisdiction or inconvenient forum. Any
such process or summons to be served upon any of the Company, the
Representatives and the Holders (at the option of the party bringing such
action, proceeding or claim) may be served by transmitting a copy thereof, by
registered or certified mail, return receipt requested, postage prepaid,
addressed to it at the address set forth in Section 13 hereof. Such mailing
shall be deemed personal service and shall be legal and binding upon the party
so served in any action, proceeding or claim. The Company, the Representatives
and the Holders agree that the prevailing party(ies) in any such action or
proceeding shall be entitled to recover from the other
17
<PAGE> 19
party(ies) all of its/their reasonable legal costs and expenses relating to such
action or proceeding and/or incurred in connection with the preparation
therefor.
SECTION 18. Entire Agreement; Modification. This Agreement
(including the Underwriting Agreement to the extent portions thereof are
referred to herein) contains the entire understanding between the parties hereto
with respect to the subject matter hereof and may not be modified or amended
except by a writing duly signed by the party against whom enforcement of the
modification or amendment is sought.
SECTION 19. Severability. If any provision of this Agreement shall
be held to be invalid or unenforceable, such invalidity or unenforceability
shall not affect any other provision of this Agreement.
SECTION 20. Captions. The caption headings of the Sections of this
Agreement are for convenience of reference only and are not intended, nor should
they be construed as, a part of this Agreement and shall be given no substantive
effect.
SECTION 21. Benefits of this Agreement. Nothing in this Agreement
shall be construed to give to any person or corporation other than the Company
and the Representatives and any other registered Holders of the Warrant
Certificates or Warrant Securities any legal or equitable right, remedy or claim
under this Agreement; and this Agreement shall be for the sole benefit of the
Company and the Representatives and any other registered Holders of Warrant
Certificates or Warrant Securities.
SECTION 22. Counterparts. This Agreement may be executed in any
number of counterparts and each of such counterparts shall for all purposes be
deemed to be an original, and such counterparts shall together constitute but
one and the same instrument.
18
<PAGE> 20
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, as of the day and year first above written.
DYNACS INC.
By: ___________________________________
Name:
Title:
Attest:
H.C. WAINWRIGHT & CO., INC.
By: ___________________________________
Name:
Title:
ROTH CAPITAL PARTNERS, INC.
By: ___________________________________
Name:
Title:
19
<PAGE> 21
EXHIBIT A
[FORM OF WARRANT CERTIFICATE]
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE OTHER SECURITIES ISSUABLE
UPON EXERCISE THEREOF MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO (i) AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), (ii) TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY
SIMILAR RULE UNDER THE ACT RELATING TO THE DISPOSITION OF SECURITIES), OR (iii)
AN OPINION OF COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO
COUNSEL FOR THE ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER THE ACT IS
AVAILABLE.
THE TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., NEW YORK TIME, ______________, 2004
No. W-___ Warrants to Purchase ____ Shares of Common Stock
WARRANT CERTIFICATE
This Warrant Certificate certifies that , or registered assigns, is
the registered holder of ________Warrants to purchase initially, at any time
from ___________, 2001 [one year from the effective date of the Registration
Statement] until 5:30 p.m. New York time on ____________, 2005 [five years from
the effective date of the Registration Statement] ("Expiration Date"), up to
__________ fully-paid and non-assessable shares of common stock, ("Common
Stock") of DYNACS INC., a Delaware corporation (the "Company"), (one share of
Common Stock referred to individually as a "Security" and collectively as the
"Securities") at the initial exercise price, subject to adjustment in certain
events (the "Exercise Price"), of $____ per share [120% of the initial public
offering price per share] of Common Stock upon surrender of this Warrant
Certificate and payment of the Exercise Price at an office or agency of the
Company, but subject to the conditions set forth herein and in the warrant
agreement dated as of ______________, 2000 among the Company, H.C. WAINWRIGHT &
CO., INC. and ROTH CAPITAL PARTNERS, INC. (the "Warrant Agreement"). Payment of
the Exercise Price shall be made by certified or official bank check in New York
Clearing House funds payable to the order of the Company.
No Warrant may be exercised after 5:30 p.m., New York time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, hereby shall thereafter be void.
<PAGE> 22
The Warrants evidenced by this Warrant Certificate are part of a
duly authorized issue of Warrants issued pursuant to the Warrant Agreement,
which Warrant Agreement is hereby incorporated by reference in and made a part
of this instrument and is hereby referred to for a description of the rights,
limitation of rights, obligations, duties and immunities thereunder of the
Company and the Holders (the words "holder" or "Holders" meaning the registered
holder or registered Holders) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price and the type and/or number of the Company's securities
issuable thereupon may, subject to certain conditions, be adjusted. In such
event, the Company will, at the request of the holder, issue a new Warrant
Certificate evidencing the adjustment in the Exercise Price and the number
and/or type of securities issuable upon the exercise of the Warrants; provided,
however, that the failure of the Company to issue such new Warrant Certificates
shall not in any way change, alter, or otherwise impair, the rights of the
holder as set forth in the Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like number
of Warrants shall be issued to the transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided herein and in the Warrant
Agreement, without any charge except for any tax or other governmental charge
imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the holder hereof a new
Warrant Certificate representing such number of unexercised Warrants.
The Company may deem and treat the registered Holders hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the Holders hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
2
<PAGE> 23
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate
to be duly executed under its corporate seal.
Dated as of ___________, 2000
DYNACS INC.
By: ___________________________________
Name:
Title:
[SEAL]
Attest:________________________
Secretary
3
<PAGE> 24
[FORM OF ELECTION TO PURCHASE PURSUANT TO SECTION 3.1]
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to purchase:
_______ shares of Common Stock;
and herewith tenders in payment for such securities a certified or official bank
check payable in New York Clearing House Funds to the order of Dynacs Inc. in
the amount of $____, all in accordance with the terms of Section 3.1 of the
Representatives' Warrant Agreement dated as of ______________, 2000 among Dynacs
Inc., H.C. Wainwright & Co., Inc. and Roth Capital Partners, Inc. The
undersigned requests that a certificate for such securities be registered in the
name of _________ whose address is ________ and that such Certificate be
delivered to _________ whose address is _________.
Dated:
Signature_________________________________
(Signature must conform in all respects to
name of holder as specified on the face of
the Warrant Certificate.)
__________________________________________
(Insert Social Security or Other
Identifying Number of Holder)
<PAGE> 25
[FORM OF ELECTION TO PURCHASE PURSUANT TO SECTION 3.2]
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to purchase:
__________ shares of Common Stock;
and herewith tenders in payment for such securities ________ Warrants all in
accordance with the terms of Section 3.2 of the Representatives' Warrant
Agreement dated as of ___________, 2000 among Dynacs Inc., H.C. Wainwright &
Co., Inc. and Roth Capital Partners, Inc. The undersigned requests that a
certificate for such securities be registered in the name of __________whose
address is __________ and that such Certificate be delivered to _________ whose
address is ________________.
Dated:
Signature_________________________________
(Signature must conform in all respects to
name of holder as specified on the face of
the Warrant Certificate.)
__________________________________________
(Insert Social Security or Other
Identifying Number of Holder)
<PAGE> 26
[FORM OF ASSIGNMENT]
(To be executed by the registered holder if such holder
desires to transfer the Warrant Certificate.)
FOR VALUE RECEIVED __________ hereby sells, assigns and transfers unto
(Please print name and address of transferee)
this Warrant Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint ________ Attorney, to
transfer the within Warrant Certificate on the books of the within-named
Company, with full power of substitution.
Dated:
Signature_________________________________
(Signature must conform in all respects to
name of holder as specified on the face of
the Warrant Certificate.)
__________________________________________
(Insert Social Security or Other
Identifying Number of Holder)
<PAGE> 1
Exhibit 10.2
THE BOEING COMPANY Acceptance Reqd |X|
DEFENSE & SPACE GROUP
P.O. BOX 240002 Special contract instructions
HUNTSVILLE, AL 35824-8402 are attached hereto
ATTN: HARRY "BUDDY" W. SCHUBELE III
DYNACS ENGINEERING CO INC
28870 U.S. HWY. 19 N.
SUITE 405
CLEARWATER FL 34621
SUPPLIER COPY PURCHASE CONTRACT NO. PCC PAGE
HX3259 04 1
- -------------------------------------------------------------------------------
CONFIRM DATE RELEASE DATE
PURCHASE CONTRACT CHANGE 04/21/95
- -------------------------------------------------------------------------------
ADDRESS ALL INQUIRIES TO BUYER: STATE SALES OR USE TAX STATUS
T. A. KELLY |_| SUBJECT TO TAX
|X| FOR RESALE NOT SUBJECT TO TX TAX
- -------------------------------------------------------------------------------
MAIL STOP AREA CODE/PHONE NO. CERT NO.
HF-96 (713) 280-7582 1-91-0425694-6
- -------------------------------------------------------------------------------
PAYMENT TERMS SHIPPING TOLERANCE
NET 30 DAYS OVER % UNDER %
- -------------------------------------------------------------------------------
PRIME CONTRACT NO. RATING ALLOTMENT
NAS 15-10000 DO-C9
- -------------------------------------------------------------------------------
SHIP VIA: F.O.B. POINT FREIGHT ALLOWANCE
NOT APPLICABLE NOT APPLICABLE NONE
- -------------------------------------------------------------------------------
SHIP TO: ORIGINAL PC RELEASE DATE
NONE 10/31/94
- -------------------------------------------------------------------------------
THE FOLLOWING CLAUSES OF FORM D1-4305-1500 (REV 01/93) ARE PART OF THIS CONTRACT
A19 C17 F11 F12 G8 G15 G16 G20 G25 G26 L1 N6 P2 P14 P16 P20 P30 P32 R8 R14 R15
R17
- -------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
1 1.00 LT TECHNICAL SUPPORT
FOR WBS 1.1.2 788704.00
THE WORK ORDER CHARGE IS 5 -2J3P1-1120-
2 1.00 LT RESERVED SEE NOTE A184
THE WORK ORDER CHARGE IS 5 -2J3P3-1130-
3 1.00 LT TECHNICAL SUPPORT
FOR WBS 1.2.6 SEE NOTE A184
THE WORK ORDER CHARGE IS 5 -2J2P8-1250-
4 1.00 LT TECHNICAL SUPPORT
FOR WB 1.3.1.1 SEE NOTE A184
THE WORK ORDER CHARGE IS 5 -2J2EC-1311-
5 1.00 LT TECHNICAL SUPPORT
FOR WBS 1.3.1.4 SEE NOTE A184
THE WORK ORDER CHARGE IS 5 -2J6EC-1314-
6 1.00 LT TECHNICAL SUPPORT
FOR WBS 1.3.1.5 SEE NOTE A184
**CONTINUED ON NEXT PAGE**
<PAGE> 2
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3259 04 2
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. A. Kelly (713) 280-7582
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
THE WORK ORDER CHARGE IS 5 -2J5EC-1315-
7 1.00 LT TECHNICAL SUPPORT
FOR WBS 1.3.3.1 SEE NOTE A184
THE WORK ORDER CHARGE IS 5 -2JOEH-1331-
8 1.00 LT TECHNICAL SUPPORT
FOR WBS 1.3.3.2 SEE NOTE A184
THE WORK ORDER CHARGE IS 5 -2J8EJ-1332-
9 1.00 LT TECHNICAL SUPPORT
(ECP'S) FOR SEE NOTE A184
WBS 1.2.9
THE WORK ORDER CHARGE IS 5 -2J5EA-1290-
10 1.00 LT TECHNICAL SUPPORT FOR WBS 1.1.1
SEE NOTE A184
THE WORK ORDER CHARGE IS 5 -2J3P0-1110-HX3259
11 1.00 LT TECHNICAL SUPPORT FOR 1.1.4
SEE NOTE A184
THE WORK ORDER CHARGE IS 5 -2J2EB-1140-HX3259
12 1.00 LT TECHNICAL SUPPORT FOR WBS 1.3.1.2
SEE NOTE A184
THE WORK ORDER CHARGE IS 5 -2J3EC-1312-HX3259
13 1.00 LT TECHNICAL SUPPORT FOR WBS 1.3.1.3
SEE NOTE A184
THE WORK ORDER CHARGE IS 5 -2J4EC-1313-HX3259
14 1.00 LT TECHNICAL SUPPORT FOR WBS 1.4
SEE NOTE A184
THE WORK ORDER CHARGE IS 5 -2JOEE-1400-HX3259
15 1.00 LT MOVING EXPENSES
SEE NOTE A184
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THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3259 04 3
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SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. A. Kelly (713) 280-7582
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
TOTAL NTE $20,000.00
THE WORK ORDER CHARGE IS 9 -2J2P8-1260-HX3259
A184 02. PRICE INCLUDED IN ITEM 1
A261 03. ACCEPTANCE OF PRIORITY RATED ORDER
IN ACCORDANCE WITH 15 CFR 700.13(D), IF THIS CONTRACT HAS
A DEFENSE PRIORITY RATING, IT MUST BE ACCEPTED OR REJECTED
IN WRITING WITHIN TEN WORKING DAYS AFTER RECEIPT IF DO
RATED OR FIVE WORKING DAYS AFTER RECEIPT IF DX RATED. IF
REJECTED, THE REASON(S) FOR SUCH REJECTION SHALL BE
INCLUDED IN THE NOTICE TO THE BUYER.
A287 04. DELETION OF DFARS CLAUSES
THAT SECTION OF THE "GOVERNMENT CLAUSES" CLAUSE, OF THE
GENERAL PROVISIONS HEREOF, WHICH INCORPORATES DOD FAR
SUPPLEMENT CLAUSES IS HEREBY DELETED.
A322 05. CERTIFICATION AND DISCLOSURE REGARDING PAYMENTS TO
INFLUENCE CERTAIN FEDERAL TRANSACTIONS
FAR 52.203-11, "CERTIFICATION AND DISCLOSURE REGARDING
PAYMENTS TO INFLUENCE CERTAIN FEDERAL TRANSACTIONS," IS
INCORPORATED HEREIN BY REFERENCE. SELLER'S SIGNED PROPOSAL
PROVIDED THE REQUIRED CERTIFICATION.
A355 07. OFFSET CREDITS
WITH RESPECT TO WORK COVERED BY THIS CONTRACT, SELLER
SHALL USE ITS BEST EFFORTS TO COOPERATE WITH BUYER IN THE
FULFILLMENT OF ANY FOREIGN OFFSET PROGRAM OBLIGATION THAT
BUYER MAY HAVE ACCEPTED AS A CONDITION OF ANY SALE. IN THE
EVENT THAT SELLER SOLICITS BIDS AND/OR PROPOSALS FOR, OR
PROCURES OR OFFERS TO PROCURE ANY GOODS OR SERVICES
RELATING TO THE WORK COVERED BY THIS CONTRACT FROM ANY
SOURCE OUTSIDE OF THE UNITED STATES, BUYER SHALL BE
ENTITLED, TO THE EXCLUSION OF ALL OTHERS, TO ALL
OFFSET/INDUSTRIAL BENEFIT CREDITS WHICH MAY RESULT FROM
SUCH SOLICITATIONS, PROCUREMENTS, OR OFFERS TO PROCURE.
SELLER AGREES TO TAKE ANY ACTIONS THAT MAY BE REQUIRED ON
ITS PART TO ASSURE THAT BUYER RECEIVES SUCH CREDITS.
SELLER FURTHER AGREES TO REPORT TO THE BUYER ANY SUCH
FOREIGN PROCUREMENT ACTIVITY EXCEEDING
**CONTINUED ON NEXT PAGE**
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THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3259 04 4
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. A. Kelly (713) 280-7582
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
$50,000. FOREIGN PROCUREMENT INFORMATION, INCLUDING ANY NO
BID OR LOST BID DATA, IS TO BE SUBMITTED TO THE BUYER'S
MATERIEL REPRESENTATIVE ON A QUARTERLY BASIS.
YOUR QUARTERLY SUBMITTAL IS TO INCLUDE THE FOLLOWING DATA:
o FOREIGN SUPPLIER (NAME AND ADDRESS)
o COUNTRY
o NOMENCLATURE
o END ITEM/USE
o REQUEST FOR PROCUREMENT/PURCHASE CONTRACT
NUMBER
o ISSUE/AWARD DATE
o US DOLLAR VALUE
ALSO REQUIRED IS THE NAME, ADDRESS, AND TELEPHONE NUMBER
OF YOUR COMPANY FOCAL POINT SUBMITTING THE ABOVE DATA.
A362 08. "MANNED SPACE FLIGHT ITEM
FOR USE IN MANNED SPACE FLIGHT; MATERIALS, MANUFACTURING
AND WORKMANSHIP OF HIGHEST QUALITY STANDARDS ARE ESSENTIAL
TO ASTRONAUT SAFETY.
IF YOU ARE ABLE TO SUPPLY THE DESIRED ITEM WITH A HIGHER
QUALITY THAN THAT OF THE ITEMS SPECIFIED OR PROPOSED, YOU
ARE REQUESTED TO BRING THIS FACT TO THE IMMEDIATE
ATTENTION OF THE BUYER.
A371 09. "TRAVEL OUTSIDE OF THE UNITED STATES
(A) THE SELLER SHALL NOTIFY THE BUYER AT LEAST 35 DAYS
IN ADVANCE OF THE START OF TRAVEL TO LOCATIONS
OUTSIDE THE UNITED STATES BY SELLER EMPLOYEES THAT
IS TO BE CHARGED TO THIS CONTRACT. IF THAT IS NOT
POSSIBLE, THE BUYER SHALL BE NOTIFIED AS SOON AS
THE TRAVEL REQUIREMENT IS IDENTIFIED.
(B) THE SELLER SHALL SUBMIT A TRAVEL REPORT TO THE
BUYER AT THE CONCLUSION OF THE TRAVEL. THE TRAVEL
REPORT SHALL BE IN THE SELLER'S FORMAT UNLESS
OTHER REQUIRED CONTENTS AND DISTRIBUTION ARE
IDENTIFIED BY THE BUYER."
A393 10. "MISSION CRITICAL SPACE SYSTEMS PERSONNEL
RELIABILITY PROGRAM
NASA FAR SUPPLEMENT 18-52.246-70, 'MISSION CRITICAL SPACE
**CONTINUED ON NEXT PAGE**
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THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3259 04 5
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SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. A. Kelly (713) 280-7582
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
SYSTEMS PERSONNEL RELIABILITY PROGRAM,' IS INCORPORATED BY
REFERENCE."
B158 11. EMERGENCY EVACUATION PROCEDURES
NASA FAR SUPPLEMENT 18-52.237-70, "EMERGENCY EVACUATION
PROCEDURES," IS INCORPORATED BY REFERENCE. "CONTRACTING
OFFICER" MEANS CONTRACTING OFFICER OR BUYER.
C144 12. ACQUISITION OF CENTRALLY REPORTABLE EQUIPMENT NASA FAR
SUPPLEMENT 18.52.245-70, "ACQUISITION OF CENTRALLY
REPORTABLE EQUIPMENT," IS INCORPORATED HEREIN BY
REFERENCE. "CONTRACTOR" MEANS SELLER AND "CONTRACTING
OFFICER" MEANS BUYER.
F272 15. "TRANSFER OF TECHNICAL DATA AND GOODS - EXPORT CONTROL
REGULATIONS
A. IN PERFORMANCE OF WORK AUTHORIZED UNDER THIS CONTRACT,
THE SELLER AND ITS SUBCONTRACTORS SHALL, AS NECESSARY,
DELIVER, DISCLOSE OR TRANSFER (EXPORT) TO A FOREIGN ENTITY
OR PERSON, TECHNICAL DATA, COMPUTER SOFTWARE OR EQUIPMENT
PURSUANT T0 NASA CONTROL AND GUIDELINES WHICH MAY BE
SUBJECT TO THE EXPORT LICENSE JURISDICTION OF THE COMMERCE
DEPARTMENT EXPORT ADMINISTRATION REGULATIONS (EAR) OR THE
STATE DEPARTMENT INTERNATIONAL TRAFFIC ARMS REGULATIONS
(ITAR).
B. IN PROCESSING SUCH EXPORTS, THE SELLER AND ITS
SUBCONTRACTORS SHALL USE RELEVANT REGULATORY EXEMPTIONS OR
OTHER APPROVALS WHICH APPLY (E.G., A GENERAL LICENSE UNDER
THE EAR, OR AN EXEMPTION UNDER THE ITAR), PURSUANT TO THIS
CLAUSE, AND SHALL ABIDE BY ANY REGULATORY REQUIREMENTS FOR
SUCH EXPORTS. SHOULD NO REGULATORY EXEMPTION OR OTHER
APPROVAL EXIST, THE SELLER SHALL INFORM NASA AND SHALL
PROVIDE THE NECESSARY DOCUMENTATION IN ORDER FOR NASA TO
OBTAIN ANY REQUIRED APPROVAL.
C. ANY EXPORT AFFECTED PURSUANT TO THIS CLAUSE SHALL BE
LIMITED TO ONLY THAT TECHNICAL DATA, COMPUTER SOFTWARE AND
HARDWARE NECESSARY TO DEFINE OR CARRY OUT NASA'S
RESPONSIBILITIES IN THE INTERNATIONAL SPACE STATION ALPHA
PROGRAM.
D. THE SELLER, SUBJECT TO NASA AND/OR BUYER CONTROL AND
**CONTINUED ON NEXT PAGE**
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THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3259 04 6
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SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. A. Kelly (713) 280-7582
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
GUIDELINES, IS AUTHORIZED TO PROVIDE THIS DIRECTION IN ALL
SPACE STATION SUBCONTRACTS AT ANY TIER, THE PERFORMANCE OF
WHICH MAY REQUIRE THE DEVELOPMENT, DELIVERY OR USE OF
TECHNICAL DATA, COMPUTER SOFTWARE, HARDWARE AND FOR WHICH
A NEED EXISTS TO EFFECT THE EXPORT BY THE SUBCONTRACTOR."
F273 16. "RIGHTS IN DATA - GENERAL, ALT, II AND ALT. III (NASA)
FAR 52.227-14, 'RIGHTS IN DATA - GENERAL,' AND ALTERNATES
II AND III THERETO, AS MODIFIED BY NASA FAR SUPP.
18-52.227-14 IS INCORPORATED BY REFERENCE."
F277 17. "IDENTIFICATION AND APPROVAL FOR USE OF RESTRICTED
COMPUTER SOFTWARE AND/OR COMMERCIAL COMPUTER SOFTWARE
A. THE SELLER SHALL IDENTIFY, IN WRITING, UPON
DEFINITIZATION, ALL RESTRICTED COMPUTER SOFTWARE AND/OR
COMMERCIAL COMPUTER SOFTWARE, AS DEFINED IN THE 'RIGHTS IN
DATA-GENERAL' AND THE 'COMMERCIAL COMPUTER SOFTWARE
LICENSING' CLAUSES OF THIS CONTRACT, THAT IS BEING USED OR
WILL BE USED IN PERFORMANCE OF THIS CONTRACT. THE BUYER
SHALL APPROVE OR DISAPPROVE, IN WRITING, USE OF THE
IDENTIFIED SOFTWARE WITHIN 75 DAYS FROM RECEIPT OF
REQUEST.
B. THE SELLER SHALL BE RESPONSIBLE FOR NOTIFYING THE BUYER
ON A CONTINUOUS BASIS OF ADDITIONAL RESTRICTED COMPUTER
SOFTWARE AND/OR COMMERCIAL COMPUTER SOFTWARE NEEDED.
C. IF THE BUYER DISAPPROVES THE USE OF RESTRICTED COMPUTER
SOFTWARE AND/OR COMMERCIAL COMPUTER SOFTWARE, WHEN SUCH
SOFTWARE IS IDENTIFIED, THE SELLER MAY SUBMIT A PROPOSAL
FOR EQUITABLE ADJUSTMENT TO THE BUYER. SUCH PROPOSALS
SHALL BE HANDLED ACCORDING TO THE PROVISIONS OF THE
'CHANGES' CLAUSE OF THIS CONTRACT."
G193 19. FINANCIAL REPORT OF GOVT.-OWNED/CONTRACTOR HELD PROPERTY
A. THE SELLER SHALL PREPARE AND SUBMIT ANNUALLY A
NASA FORM 1018, REPORT OF
GOVERNMENT-OWNED/CONTRACTOR-HELD PROPERTY, IN
ACCORDANCE WITH THE INSTRUCTIONS ON THE FORM AND
SUBSECTION 18-45.505-14 OF THE NASA FAR
SUPPLEMENT, EXCEPT THE REPORTING OF SPACE HARDWARE
SHALL BE REQUIRED ONLY UPON THE WRITTEN DIRECTION
OF THE BUYER IDENTIFYING THE SPECIFIC PROJECT
ITEMS TO BE REPORTED.
B. THE ORIGINAL AND THREE COPIES OF NASA FORM 1018
SHALL
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THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3259 04 7
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SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. A. Kelly (713) 280-7582
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
BE SUBMITTED TO BUYER'S MATERIEL REPRESENTATIVE.
C. THE ANNUAL REPORTING PERIOD SHALL BE FROM OCTOBER
1 OF EACH YEAR TO SEPTEMBER 30 OF THE FOLLOWING
YEAR. THE REPORT SHALL BE SUBMITTED BY OCTOBER 15.
G194 20. PRICE ADJUSTMENT FOR APPROVED RATES
THE PRICE OF THIS CONTRACT IS BASED UPON CERTAIN RATES AND
FACTORS WHICH HAVE NOT BEEN APPROVED BY THE GOVERNMENT. IT
IS AGREED THAT UPON THE GOVERNMENT'S APPROVAL OF SELLER'S
RATES AND FACTORS, THE PRICE OF THIS CONTRACT SHALL BE
ADJUSTED, DOWNWARD ONLY, ACCORDINGLY.
G210 21. INVOICE REQUIREMENTS
INVOICES PRESENTED BY THE SELLER SHALL CONTAIN THE
FOLLOWING INFORMATION:
(1) PURCHASE CONTRACT NUMBER
(2)ITEM NUMBER
(3) PART NUMBER
(4) QUANTITY
(5) UNIT PRICE
(6) TOTAL PRICE
(7) TOTAL TAX
(8) FREIGHT
(9) PROMPT PAYMENT DISCOUNTS (IF APPLICABLE)
INCORRECT INVOICES MAY DELAY PAYMENTS.
G245 22. "FISCAL YEAR EXPENDITURE CONSTRAINTS
A. NOTIFICATION. IN THE EVENT IT IS NECESSARY TO LIMIT THE
SELLER'S FISCAL YEAR CONTRACT COST EXPENDITURES TO
ACCOMMODATE NASA FISCAL CONSTRAINTS, THE BUYER SHALL SO
NOTIFY THE SELLER IN WRITING.
B. SELLER PERFORMANCE. UPON RECEIPT OF ANY SUCH
NOTIFICATION, THE SELLER SHALL PROCEED TO TAILOR ITS
CONTRACT PERFORMANCE TO ACCOMMODATE SUCH LIMITATION USING
ITS BEST EFFORTS TO MINIMIZE PROGRAM IMPACT AND SHALL
PROMPTLY ADVISE THE BUYER OF SIGNIFICANT ACTIONS TAKEN OR
CONSEQUENCES EXPECTED.
C. CONTRACT CHANGES. IN THE EVENT CONTRACT CHANGES ARE
ISSUED WHEN SUCH A FISCAL LIMITATION IS IN EFFECT, THE
BUYER SHALL ADVISE CONCURRENT WITH THEIR ISSUANCE THE
**CONTINUED ON NEXT PAGE**
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THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3259 04 8
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SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. A. Kelly (713) 280-7582
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
EXTENT, IF ANY, TO WHICH THE LIMITATION IS CHANGED.
D. LIMITATION DEEMED A CHANGE. THE IMPOSITION OF ANY
FISCAL YEAR EXPENDITURE LIMITATION SHALL BE DEEMED TO BE A
CHANGE ISSUED PURSUANT TO THE 'CHANGES' ARTICLE OF THIS
CONTRACT, AND ANY EQUITABLE ADJUSTMENT RESULTING FROM ANY
SUCH LIMITATION SHALL BE EFFECTED IN ACCORDANCE WITH THE
PROCEDURES OF THE 'CHANGES' CLAUSE.
E. LIMITATION IN RELATION TO CONTRACT FUNDING.
NOTWITHSTANDING THE SELLER'S OBLIGATION TO USE ITS BEST
EFFORTS TO COMPLY WITH ANY FISCAL YEAR LIMITATION, NOTHING
IN THIS CONTRACT CLAUSE SHALL BE CONSTRUED AS MODIFYING
THE CLAUSES OF THIS CONTRACT ENTITLED 'LIMITATION OF
FUNDS'."
H119 23. "IDENTIFICATION OF EMPLOYEES
AT ALL TIMES WHILE ON GOVERNMENT PROPERTY, THE SELLER,
SUBCONTRACTORS, THEIR EMPLOYEES AND AGENTS SHALL WEAR
BADGES WHICH WILL BE ISSUED BY THE NASA CONTRACT AND PASS
OFFICE, LOCATED IN BUILDING NO. 110. BADGES WILL BE ISSUED
ONLY BETWEEN THE HOURS OF 7:00 A.M. AND 4:00 P.M., MONDAY
THROUGH FRIDAY. EACH INDIVIDUAL WHO WEARS A BADGE WILL BE
REQUIRED TO SIGN PERSONALLY FOR THE BADGE. THE SELLER WILL
BE HELD ACCOUNTABLE FOR THESE BADGES, AND IMMEDIATELY
AFTER COMPLETION OF THE WORK THEY SHALL BE RETURNED TO THE
NASA CONTRACT BADGE AND PASS OFFICE. FAILURE TO TURN IN
BADGES UPON COMPLETION OF THE WORK MAY RESULT IN FINAL
PAYMENT BEING DELAYED."
N138 24. DELETION OF FAR 52.227-12
FAR 52.227-12 "PATENT RIGHTS RETENTION BY THE CONTRACTOR
(LONG FORM)," INCLUDED IN THE GENERAL PROVISIONS FORM
INCORPORATED BY REFERENCE, IS DELETED.
P152 25. WHEREVER REFERENCE IS MADE IN THIS CONTRACT TO A FAR,
FAR SUPPLEMENT, OAR, NASA PR OR FPR CLAUSE, SUCH CLAUSE
SHALL BE DEEMED TO BE THE ONE IN EFFECT ON THE DATE SET
FORTH BELOW:
DATE 10/93
R154 26. NASA SMALL DISADVANTAGED BUSINESS GOAL
NASA FAR SUPP. 18-52.219-76, "NASA SMALL DISADVANTAGE
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THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3259 04 9
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SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. A. Kelly (713) 280-7582
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
BUSINESS GOAL" IS INCORPORATED BY REFERENCE.
R160 27. SMALL BUSINESS AND SMALL DISADVANTAGED BUSINESS
SUBCONTRACTING REPORTING
NASA FAR SUPPLEMENT 18-52.219-75, "SMALL BUSINESS AND
SMALL DISADVANTAGED BUSINESS SUBCONTRACTING REPORTING," IS
INCORPORATED, BY REFERENCE.
BTPE 28. PLEASE RETURN ACCEPTANCE COPY OF THIS PURCHASE
CONTRACT AND ALL CORRESPONDENCE TO:
THE BOEING COMPANY
SPACE STATION INTEGRATION
P.O. BOX 58747
HOUSTON, TX 77258
TERESA A. KELLY HF-96
BTQ2 29. VENDOR WILL COMPLY WITH THE HAZARD COMMUNICATIONS
STANDARD, 29 CFR 1910.1200, IF APPLICABLE. INITIALLY, ALL
MATERIAL SAFETY DATA SHEETS SHALL BE PROVIDED TO:
SAFETY, HEALTH & ENVIROMMENTAL AFFAIRS (SHEA)
THE BOEING COMPANY
P.O. BOX 240002, M/S JM-30
HUNTSVILLE, AL 35824-6402
AND, INCLUDE AN MSDS IN ALL SUBSEQUENT SHIPMENTS FOR THIS
CONTRACT.
BT69 30. SEND ALL INVOICES TO: BOEING DEFENSE & SPACE GROUP
ACCOUNTS PAYABLE
P.O. BOX 34113, M/S 80-FW
SEATTLE, WA. 98124-1113
BT7I 31. PROMPT PAYMENT DISCOUNTS WERE REQUESTED:
NET 30
FN01 32. 1. SCOPE OF WORK
A. THE SELLER SHALL PROVIDE ALL RESOURCES. EXCEPT AS
OTHERWISE PROVIDED FOR IN THIS CONTRACT, NECESSARY
TO PERFORM THOSE FUNCTIONS MORE FULLY DESCRIBED IN
THE STATEMENT OF WORK #ISSA-TS-94 OF THIS
CONTRACT.
**CONTINUED ON NEXT PAGE**
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THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3259 04 10
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SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. A. Kelly (713) 280-7582
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
B. THE SELLER SHALL COMMENCE AND SUSTAIN ALL TASKS
DURING THE CONTRACT PERIOD OF PERFORMANCE, THAT
ARE NECESSARY AND APPROPRIATE FOR PROCEEDING IN A
TIMELY AND ORDERLY MANNER AS SCHEDULED FOR THE
CONTRACT PERIOD. THE SELLER SUPPORT FOR SUCH
ELEMENTS SHALL BE CONSISTENT WITH NASA'S PLANNED
CONTENT AND SCHEDULES FOR THEM, AS CHANGED FROM
TIME TO TIME TO DEAL WITH UNEXPECTED
CIRCUMSTANCES, GOVERNMENT REQUIREMENTS OR BUYER
NEEDS.
FNO2 33. 2. PERIOD OF PERFORMANCE
THE PERIOD OF PERFORMANCE OF THIS CONTRACT SHALL BE
9/22/94 THROUGH 2/23/95.
FNO3 34. 3. PLACE OF PERFORMANCE
THE PLACE OF PERFORMANCE FOR THE WORK CALLED FOR HEREUNDER
IS JOHNSON SPACE CENTER, HOUSTON, TEXAS, AND AT OTHER
LOCATIONS WHERE THE REQUIREMENT IS COVERED BY THE
OBLIGATIONS SPECIFIED IN SECTION C OF SOW-ISSA-TS-94.
FNO4 35. 4. LEVEL-OF-EFFORT
THE STATEMENT OF WORK #ISSA-TS-94 IDENTIFIES CURRENT
PROJECTED LEVELS OF SUPPORT. AS THESE LEVELS OF SUPPORT
MAY VARY AS THE PROGRAM PROGRESSES, OFFEROR AGREES TO
PROVIDE 80-175 PERCENT OF THE PROJECTED LEVEL OF SUPPORT
FOR THE SAME PRICE. BOEING RESERVES THE RIGHT TO
UNILATERALLY INCREASE OR DECREASE THE LEVEL OF SUPPORT,
REGARDING RUSSIAN INTEGRATION AND MISCELLANEOUS
ENGINEERING SERVICES. ADDITIONAL STATEMENT OF WORK/JOB
DESCRIPTIONS WITH VARIOUS ESTIMATED SALARY RANGES MAY BE
ADDED. DIRECT LABOR RATES FOR ADDITIONAL POSITIONS WILL BE
NEGOTIATED AS THEY ARE IDENTIFIED. THIRTY-DAY NOTIFICATION
WILL BE PROVIDED ON PERSONNEL REDUCTIONS.
FNOS 36. 5. HANDLING OF DATA
IT IS ANTICIPATED THAT IN PERFORMANCE OF THIS CONTRACT,
THE SELLER MAY HAVE ACCESS TO AND USE OF NASA'S SENSITIVE
FINANCIAL AND MANAGEMENT DATA. THE SELLER AGREES THAT IT
WILL NOT USE, COPY, OR DISCLOSE THIS DATA, EXCEPT AS
NECESSARY FOR THE PERFORMANCE OF THE
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THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3259 04 11
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SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. A. Kelly (713) 280-7582
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
CONTRACT AND WILL NOT DISCLOSE THIS DATA TO OTHERS WITHOUT
THE WRITTEN CONSENT OF THE BUYER OR HIS AUTHORIZED
REPRESENTATIVE.
FNO6 37. 6. PERMITS AND LICENSES
IN PERFORMANCE OF THE WORK HEREUNDER, THE SELLER SHALL BE
RESPONSIBLE FOR OBTAINING ALL NECESSARY PERMITS AND
LICENSES, AND FOR COMPLYING WITH ALL APPLICABLE FEDERAL,
STATE, AND MUNICIPAL LAWS.
FNO7 38. 7. SUBCONTRACT COST REPORT (533 REPORT)
A MONTHLY 533 REPORT WILL BE REQUIRED TO BE SUBMITTED. THE
REPORT IS DUE EACH MONTH ON THE FOLLOWING DATES:
REPORT DUE REPORT DUE
MONTH DATE MONTH DATE
25 AUG SEPT 1, 1994 23 FEB. MARCH 2, 1995
29 SEPT OCT. 6, 1994 30 MAR. APRIL 6, 1995
27 OCT. NOV. 3, 1994 27 APR. MAY 4, 1995
24 NOV. DEC. 1, 1994 25 MAY JUNE 1, 1995
29 DEC. JAN. 5, 1995 29 JUNE JULY 6, 1995
26 JAN. FEB. 2, 1995 27 JULY AUG. 3, 1995
THE BALANCE OF DATES WILL BE PROVIDED AT A LATER DATE.
FNO8 39. THE BILLING RATES APPLICABLE TO THIS PURCHASE CONTRACT
ARE THE RATES WHICH WERE DETERMINED AT NEGOTIATIONS -
REFERENCE HX3283, ATTACHMENT A (HX3283 REPLACES HX3259).
FNO9 40. PROVISIONS PERTINENT TO WORK PERFORMED AT NASA-JSC, AND
NOT INCLUDED IN STANDARD BOEING OR NAS 15-10000 CLAUSES,
ARE INCLUDED IN THIS CONTRACT AS ATTACHMENT "A".
PCOI 41. PCC ISSUED TO:
ADD LINE ITEMS 10 THROUGH 14 TO INCLUDE ADDITIONAL WBS
NUMBERS; ADD LINE ITEM 15 FOR MOVING EXPENSES; DELETE TN
181 AND REPLACE WITH A183; ADD SP Al9; UPDATE TN A337;
CHANGE MAIL STOP ON NOTE BTPE 28. PER GROUP COUNSEL -
ADD TN A386, DELETE TN C150 & C151, DELETE SP Fl, G17,
& N9.
A386 43. CHANGES TO GENERAL PROVISIONS FORM
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THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
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SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. A. Kelly (713) 280-7582
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
THE GENERAL PROVISIONS FORM, INCORPORATED BY REFERENCE, IS
REVISED AS FOLLOWS:
(A) THE "DEFENSE PRIORITY RATING" PARAGRAPH OF THE
"GOVERNMENT CLAUSES" ARTICLE IS REVISED BY DELETING "(15
CFR 350)" AND SUBSTITUTING "(15 CFR 700)"
(B) THE "ADDITIONAL CLAUSES" PARAGRAPH OF THE "GOVERNMENT
CLAUSES" ARTICLE IS REVISED BY DELETING THE PARENTHETICAL
PHRASE APPLICABLE TO FAR 52.222-4.
PCO2 44. THIS CHANGE IS BEING ISSUED TO:
1.ADD $311,000.00 TO NTE VALUE (A183)
2.CHANGE PERIOD OF PERFORMANCE TO 9/22/94 - 2/23/95
(FNO2)
PCO3 45. PCC REQUIRED TO REVISE UNIT PRICE.
PCO4 46. THIS CHANGE IS ISSUED TO:
1. DEFINITIZE CONTRACT
2. DELETE SPECIAL PROVISION A4
3. DELETE TYPING NOTES: A183, A337 & GIIO
4. REVISE FREE NOTE FNO8
5. ADD $27,704.00 TO COVER RECONVILIATION INVOICE
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SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. A. Kelly (713) 280-7582
- --------------------------------------------------------------------------------
GENERAL INSTRUCTIONS
A. THE PURCHASE CONTRACT NUMBER SHOWN ON THE FACE OF THE ORDER AND THE
APPLICABLE ITEM NUMBER(S) MUST APPEAR ON ALL INVOICES AND CORRESPONDENCE
PERTAINING TO THIS CONTRACT.
B. REFER OR ADDRESS ALL INQUIRIES REGARDING THIS CONTRACT (EXCEPT INVOICES).
TO THE BUYER AT THE BOEING MAIL STOP SPECIFIED ON THIS CONTRACT. INVOICES
ARE TO BE MAILED TO THE ATTENTION OF ACCOUNTS PAYABLE (BOEING DEFENSE &
SPACE GROUP, P.O. BOX 34113, SEATTLE, WA 98124--1113).
C. YOUR BILLING UNIT OF MEASURE (U/M) MUST BE THE SAME AS THE U/M ORDERED,
UNLESS OTHERWISE NOTED. UNIT PRICES SHOWN IN THIS CONTRACT ARE NET AND
APPLICABLE TRADE DISCOUNTS HAVE BEEN CONSIDERED. FEDERAL EXCISE TAX, IF
ANY, MUST BE SHOWN AS A SEPARATE ITEM ON YOUR INVOICES. TWO COPIES OF ALL
INVOICES MUST BE SUBMITTED. ONE COPY MUST BE MARKED ORIGINAL.
D. ALL ITEMS SHALL BE TO THE LATEST DRAWINGS AND SPECIFICATIONS UNLESS
EXCEPTIONS ARE SPECIFIED IN THIS CONTRACT.
SHIPPING INSTRUCTIONS
A. ALL SHIPMENTS WHICH ARE F.0.B. SHIPPING POINT ARE TO BE SHIPPED COLLECT
WHEN CONSIGNED TO A BOEING ADDRESS. F.O.B. DESTINATION SHIPMENTS TO BE
SHIPPED PREPAID VIA CARRIER OF YOUR CHOICE. PLEASE INDICATE DESTINATION ZIP
CODE, SPECIFIC STREET AND BUILDING ADDRESS ON ALL SHIPMENTS.
B. ALL SHIPMENTS FROM HUNTSVILLE COMMERCIAL ZONE THAT ARE F.O.B. SHIPPING
POINT SHOULD BE SHIPPED VIA UNITED PARCEL SERVICE (UPS) OR BOEING LICENSED
TRANSPORTATION.
C. BOEING PURCHASE CONTRACT NUMBER(S) AND ITEM NUMBER(S) MUST APPEAR ON ALL
PACKING SHEETS AND FREIGHT BILLS, INCLUDING THIRD PARTY FREIGHT BILLS.
D. CONSOLIDATE ALL COLLECT SHIPMENTS TO BE FORWARDED VIA THE SAME
TRANSPORTATION MODE ON ANY ONE DAY TO ANY ONE CONSIGNMENT ADDRESS.
E. DO NOT COMBINE SHIPMENTS FOR VARIOUS BOEING COMPANIES AND DIVISIONS UNLESS
SPECIFICALLY INSTRUCTED.
F. DO NOT INSURE OR DECLARE VALUE ON ANY SHIPMENT EXCEPT TO OBTAIN LOWEST
RATES WHEN BASED ON A RELEASED VALUE.
G. SHIPMENTS FROM OUTSIDE USA MUST BE ACCOMPANIED BY PRICED INVOICE FOR U.S.
CUSTOMS CLEARANCE.
H. ADDITIONAL COPY OF PACKING LIST TO BE PLACED INSIDE PACKAGE.
I. LIST NUMBER OF PACKAGES ON OUTSIDE OF PACKAGES. I.E. (1of3, 2of3, ETC.).
J. SURFACE SHIPMENTS OVER 5,000 POUNDS, OVER-DIMENSIONAL, REQUIRE SPECIAL
HANDLING, EXCLUSIVE USE OF VEHICLE, OR SPECIALIZED TRANSPORTATION
EQUIPMENT. PHONE TRAFFIC MANAGEMENT FOR SPECIFIC INSTRUCTIONS 48 HOURS
PRIOR TO SHIPMENT. CALL (205) 772--2616 or 2617.
K. AIR SHIPMENTS OVER 500 POUNDS, OVER-DIMENSIONAL OR REQUIRE SPECIAL
HANDLING, PHONE TRAFFIC MANAGEMENT FOR SPECIFIC INSTRUCTIONS 24 HOURS PRIOR
TO SHIPMENT. CALL (205) 772-2616-2617.
L. INSTRUCTIONS FOR DOMESTIC SHIPMENTS. INCLUDING GOVERNMENT BILL OF LADING
SHIPMENTS.
1. STANDARD (SURFACE) SHIPMENTS 150 POUNDS OR LESS PER PIECE SHIP VIA
UNITED PARCEL SERVICE (UPS). SHIP COLLECT VIA THE CONSIGNEE BILLING
PROGRAM. FOR INFORMATION ON THIS PROGRAM CALL UPS AT 1-800-354-7527.
(PLEASE REFERENCE THE BOEING PURCHASE ORDER NUMBER ON ALL PIECES).
FOR STANDARD (SURFACE) SHIPMENTS FROM 151 POUNDS TO 5,000 POUNDS SHIP
VIA CF MOTORFREIGHT. SHIP COLLECT AND REFERENCE THE BOEING PURCHASE
ORDER NUMBER ON ALL SHIPMENTS.
2. SPECIFIC STREET AND BUILDING ADDRESS MUST BE SHOWN ON ALL SHIPMENTS.
3. WHEN PURCHASE CONTRACT DIRECTS 'SHIP VIA' GBL (GOVERNMENT BILL OF
LADING) OBTAIN SAME FROM YOUR REGIONAL DCMAO (DEFENSE CONTRACT
MANAGEMENT AREA OFFICE).
<PAGE> 14
THE BOEING COMPANY Acceptance Reqd |X|
DEFENSE & SPACE GROUP
P.O. BOX 240002 Special Contract Instructions
HUNTSVILLE, AL 35824-8402 are attached hereto
ATTN:
DYNACS ENGINEERING CO INC
28870 U.S. HWY. 19 N.
SUITE 405
CLEARWATER FL 34621
SUPPLIER COPY PURCHASE CONTRACT NO. PCC PAGE
HX3283 04 1
- -------------------------------------------------------------------------------
CONFIRM DATE RELEASE DATE
PURCHASE CONTRACT CHANGE 06/23/97
- -------------------------------------------------------------------------------
ADDRESS ALL INQUIRIES TO BUYER: STATE SALES OR USE TAX STATUS
M. S. BLACKWELL |_| SUBJECT TO TAX
|X| FOR RESALE NOT SUBJECT TO TX TAX
- -------------------------------------------------------------------------------
MAIL STOP AREA CODE/PHONE NO. CERT NO.
HS-41 (713) 336-5012 1-91-0425694-6
- -------------------------------------------------------------------------------
PAYMENT TERMS SHIPPING TOLERANCE
1/2% 10TH NET 30 OVER % UNDER %
- -------------------------------------------------------------------------------
PRIME CONTRACT NO. RATING ALLOTMENT
CONTRACT LABOR-9
- -------------------------------------------------------------------------------
SHIP VIA: F.O.B. POINT FREIGHT ALLOWANCE
NOT APPLICABLE NOT APPLICABLE NONE
- -------------------------------------------------------------------------------
SHIP TO: ORIGINAL PC RELEASE DATE:
NONE 03/06/95
- -------------------------------------------------------------------------------
THE FOLLOWING CLAUSES OF FORM D1-4305-1500 (REV 01/93) ARE PART OF THIS
CONTRACT A19 B2 F1 F2 G8 G16 G20 G25 G26 K4 L1 L2 N6 N9 P2 P30 P32
R14 R15 R17 S T
- -------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
1 1.00 LT CONTRACT LABOR
PERIOD OF PERFORMANCE 3749082.00
2/24/95 - 9/30/95
PRICE INCLUDES 3/3% OVERTIME
PROCUREMENT ORIGINALLY AWARDED AS PC HX3259 AND LATER CONVERTED TO
THIS LABOR CONTRACT P.C. HX3283 EFFECTIVE 24 FEBRUARY 1995.
THE WORK ORDER CHARGE IS 7 -91055-H307-HX3283
2 1.00 LT CONTRACT LABOR
PERIOD OF PERFORMANCE 9305513.00
10/1/95 - 9/30/96
PRICE INCLUDES 3.3% OVERTIME
THE WORK ORDER CHARGE IS 7 -91055-H307-HX3283
3 1.00 LT CONTRACT LABOR
PERIOD OF PERFORMANCE 10680093.00
10/1/96 - 9/30/97
PRICE INCLUDES 3.3% OVERTIME
THE WORK ORDER CHARGE IS 7 -91055-H307-HX3283
4 CANCELED LT CANCELLED LINE ITEM
NO CHARGE
**CONTINUED ON NEXT PAGE**
<PAGE> 15
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3283 04 2
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
THE WORK ORDER CHARGE IS 7 -91055-H307-HX3283
5 1.00 LT RELOCATION (MOVING) EXPENSES
25022.00
THE WORK ORDER CHARGE IS 7 -91055-H307-HX3283
A261 02. ACCEPTANCE OF PRIORITY RATED ORDER
IN ACCORDANCE WITH 15 CFR 700.13(D), IF THIS CONTRACT HAS
A DEFENSE PRIORITY RATING, IT MUST BE ACCEPTED OR REJECTED
IN WRITING WITHIN TEN WORKING DAYS AFTER RECEIPT IF DO
RATED OR FIVE WORKING DAYS AFTER RECEIPT IF DX RATED. IF
REJECTED, THE REASON(S) FOR SUCH REJECTION SHALL BE
INCLUDED IN THE NOTICE TO THE BUYER.
A287 03. DELETION OF DFARS CLAUSES
THAT SECTION OF THE "GOVERNMENT CLAUSES" CLAUSE, OF THE
GENERAL PROVISIONS HEREOF, WHICH INCORPORATES DOD FAR
SUPPLEMENT CLAUSES IS HEREBY DELETED.
A315 04. PROCUREMENT INTEGRITY SUBCONTRACTOR NOT INVOLVED DURING
AWARD OF PRIME CONTRACT
AS AN EXPRESS CONDITION OF THE AWARD OF THIS SUBCONTRACT,
SELLER AGREES, REPRESENTS, AND WARRANTS THAT IT HAS, AND
SHALL CONTINUE TO COMPLY WITH THE PROCUREMENT INTEGRITY
PROVISIONS OF THE OFFICE OF FEDERAL PROCUREMENT POLICY ACT
AMENDMENTS OF 1988 (THE ACT), 41 U.S.C. 423 AND ITS
IMPLEMENTING FEDERAL ACQUISITION REGULATIONS (SEE FAR
3.104), IN RELATION TO ALL EXTENSIONS AND MODIFICATIONS OF
THE PRIME CONTRACT UNDER WHICH THIS SUBCONTRACT IS ISSUED.
FOR VIOLATIONS OF THE ACT BY THE SELLER OR SELLER'S
SUBCONTRACTORS:
(1) SELLER SHALL REIMBURSE THE BUYER, BY CONTRACT
PRICE ADJUSTMENT OR OTHERWISE, THE AMOUNT BY WHICH BUYER'S
PRICE OR FEE IS REDUCED PURSUANT TO FAR 52.203-10(D), AND
(2) BUYER SHALL HAVE THE RIGHT TO TERMINATE THIS
SUBCONTRACT FOR DEFAULT. THE RIGHTS AND REMEDIES OF BUYER
PROVIDED FOR UNDER THIS CLAUSE ARE IN ADDITION TO ANY
OTHER RIGHTS AND REMEDIES PROVIDED BY LAW OR UNDER THIS
CONTRACT. THE RIGHTS AND OBLIGATIONS SET FORTH IN THIS
**CONTINUED ON NEXT PAGE**
<PAGE> 16
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3283 04 3
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
CLAUSE SHALL SURVIVE COMPLETION OF, FINAL PAYMENT UNDER,
OR TERMINATION OF THIS CONTRACT.
A322 05. CERTIFICATION AND DISCLOSURE REGARDING PAYMENTS TO
INFLUENCE CERTAIN FEDERAL TRANSACTIONS
FAR 52.203-11, "CERTIFICATION AND DISCLOSURE REGARDING
PAYMENTS TO INFLUENCE CERTAIN FEDERAL TRANSACTIONS," IS
INCORPORATED HEREIN BY REFERENCE. SELLER'S SIGNED PROPOSAL
PROVIDED THE REQUIRED CERTIFICATION.
A371 07. TRAVEL OUTSIDE OF THE UNITED STATES
(A) THE SELLER SHALL NOTIFY THE BUYER AT LEAST 35 DAYS
IN ADVANCE OF THE START OF TRAVEL TO LOCATIONS
OUTSIDE THE UNITED STATES BY SELLER EMPLOYEES THAT
IS TO BE CHARGED TO THIS CONTRACT. IF THAT IS NOT
POSSIBLE, THE BUYER SHALL BE NOTIFIED AS SOON AS
THE TRAVEL REQUIREMENT IS IDENTIFIED.
(B) THE SELLER SHALL SUBMIT A TRAVEL REPORT TO THE
BUYER AT THE CONCLUSION OF THE TRAVEL. THE TRAVEL
REPORT SHALL BE IN THE SELLER'S FORMAT UNLESS
OTHER REQUIRED CONTENTS AND DISTRIBUTION ARE
IDENTIFIED BY THE BUYER."
A393 08. "MISSION CRITICAL SPACE SYSTEMS PERSONNEL
RELIABILITY PROGRAM
NASA FAR SUPPLEMENT 18-52.246-70, `MISSION CRITICAL SPACE
SYSTEMS PERSONNEL RELIABILITY PROGRAM,' IS INCORPORATED BY
REFERENCE."
B158 09. EMERGENCY EVACUATION PROCEDURES
NASA FAR SUPPLEMENT 18-52.237-70, EMERGENCY EVACUATION
PROCEDURES," IS INCORPORATED BY REFERENCE. "CONTRACTING
OFFICER" MEANS CONTRACTING OFFICER OR BUYER.
F272 10. TRANSFER OF TECHNICAL DATA AND GOODS - EXPORT CONTROL
REGULATIONS
A. IN PERFORMANCE OF WORK AUTHORIZED UNDER THIS CONTRACT,
THE SELLER AND ITS SUBCONTRACTORS SHALL, AS NECESSARY,
DELIVER, DISCLOSE OR TRANSFER (EXPORT) TO A FOREIGN ENTITY
OR PERSON, TECHNICAL DATA, COMPUTER SOFTWARE OR EQUIPMENT
**CONTINUED ON NEXT PAGE**
<PAGE> 17
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3283 04 4
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
PURSUANT TO NASA CONTROL AND GUIDELINES WHICH MAY BE
SUBJECT TO THE EXPORT LICENSE JURISDICTION OF THE COMMERCE
DEPARTMENT EXPORT ADMINISTRATION REGULATIONS (EAR) OR THE
STATE DEPARTMENT INTERNATIONAL TRAFFIC ARMS REGULATIONS
(ITAR).
B. IN PROCESSING SUCH EXPORTS, THE SELLER AND ITS
SUBCONTRACTORS SHALL USE RELEVANT REGULATORY EXEMPTIONS OR
OTHER APPROVALS WHICH APPLY (E.G., A GENERAL LICENSE UNDER
THE EAR, OR AN EXEMPTION UNDER THE ITAR), PURSUANT TO THIS
CLAUSE, AND SHALL ABIDE BY ANY REGULATORY REQUIREMENTS FOR
SUCH EXPORTS. SHOULD NO REGULATORY EXEMPTION OR OTHER
APPROVAL EXIST, THE SELLER SHALL INFORM NASA AND SHALL
PROVIDE THE NECESSARY DOCUMENTATION IN ORDER FOR NASA TO
OBTAIN ANY REQUIRED APPROVAL.
C. ANY EXPORT AFFECTED PURSUANT TO THIS CLAUSE SHALL BE
LIMITED TO ONLY THAT TECHNICAL DATA, COMPUTER SOFTWARE AND
HARDWARE NECESSARY TO DEFINE OR CARRY OUT NASA'S
RESPONSIBILITIES IN THE INTERNATIONAL SPACE STATION ALPHA
PROGRAM.
D. THE SELLER, SUBJECT TO NASA AND/OR BUYER CONTROL AND
GUIDELINES, IS AUTHORIZED TO PROVIDE THIS DIRECTION IN ALL
SPACE STATION SUBCONTRACTS AT ANY TIER, THE PERFORMANCE OF
WHICH MAY REQUIRE THE DEVELOPMENT, DELIVERY OR USE OF
TECHNICAL DATA, COMPUTER SOFTWARE, HARDWARE AND FOR WHICH
A NEED EXISTS TO EFFECT THE EXPORT BY THE SUBCONTRACTOR."
F273 11. "RIGHTS IN DATA - GENERAL, ALT, II AND ALT. III (NASA)
FAR 52.227-14, 'RIGHTS IN DATA - GENERAL,' AND ALTERNATES
II AND III THERETO, AS MODIFIED BY NASA FAR SUPP.
18-52.227-14 IS INCORPORATED BY REFERENCE."
F276 12. "COMMERCIAL COMPUTER SOFTWARE-LICENSING"
NASA FAR SUPPLEMENT 18-52.227-86, 'COMMERCIAL COMPUTER
SOFTWARE-LICENSING,' IS INCORPORATED BY REFERENCE."
F277 13. "IDENTIFICATION AND APPROVAL FOR USE OF RESTRICTED
COMPUTER SOFTWARE AND/OR COMMERCIAL COMPUTER SOFTWARE
A. THE SELLER SHALL IDENTIFY, IN WRITING, UPON
DEFINITIZATION, ALL RESTRICTED COMPUTER SOFTWARE AND/OR
COMMERCIAL COMPUTER SOFTWARE, AS DEFINED IN THE 'RIGHTS IN
DATA-GENERAL' AND THE 'COMMERCIAL COMPUTER SOFTWARE
**CONTINUED ON NEXT PAGE**
<PAGE> 18
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3283 04 5
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
LICENSING' CLAUSES OF THIS CONTRACT, THAT WILL BE
DELIVERED IN PERFORMANCE OF THIS CONTRACT. THE BUYER SHALL
APPROVE OR DISAPPROVE, IN WRITING, USE OF THE IDENTIFIED
SOFTWARE WITHIN 75 DAYS FROM RECEIPT OF REQUEST.
B. THE SELLER SHALL BE RESPONSIBLE FOR NOTIFYING THE BUYER
ON A CONTINUOUS BASIS OF ADDITIONAL RESTRICTED COMPUTER
SOFTWARE AND/OR COMMERCIAL COMPUTER SOFTWARE NEEDED.
C. IF THE BUYER DISAPPROVES THE USE OF RESTRICTED COMPUTER
SOFTWARE AND/OR COMMERCIAL COMPUTER SOFTWARE, WHEN SUCH
SOFTWARE IS IDENTIFIED, THE SELLER MAY SUBMIT A PROPOSAL
FOR EQUITABLE ADJUSTMENT TO THE BUYER. SUCH PROPOSALS
SHALL BE HANDLED ACCORDING TO THE PROVISIONS OF THE
'CHANGES' CLAUSE OF THIS CONTRACT."
F281 14. TECHNICAL INFORMATION RELEASES AND PUBLICATIONS
AS AUTHORIZED BY PARAGRAPH (D)(1) OF THE RIGHTS IN DATA
GENERAL CLAUSE OF THE PURCHASE CONTRACT, THE FOLLOWING
EXCEPTION SHALL APPLY:
DURING THE PERFORMANCE OF THIS PURCHASE CONTRACT, IF DATA
RELATING TO THIS CONTRACT IS PLANNED FOR USE IN ORAL OR
WRITTEN PRESENTATIONS, PROFESSIONAL MEETINGS, SEMINARS, OR
IN ARTICLES TO BE PUBLISHED IN PROFESSIONAL, SCIENTIFIC,
AND TECHNICAL JOURNALS AND SIMILAR MEDIA, SELLER SHALL
ASSURE THAT AN ADVANCE INFORMATION COPY OF THE
PRESENTATION OR ARTICLE IS SENT TO THE BUYER TO HAVE THE
BENEFIT OF ADVANCE INFORMATION CONCERNING ACCOMPLISHMENTS
OF INTEREST, AND WILL PROVIDE THE BUYER AN OPPORTUNITY TO
MAKE SUGGESTIONS TO THE SELLER CONCERNING REVISIONS IF IT
IS CONSIDERED THAT SUCH COMMENTS MIGHT BE USEFUL TO THE
SELLER TO HELP ASSURE THE TECHNICAL ACCURACY OF THE
INFORMATION TO BE PRESENTED OR PUBLISHED. THE INFORMATION
COPY WILL BE FORWARDED TO THE BUYER AT LEAST FOUR WEEKS IN
ADVANCE OF THE DATE THE AUTHOR INTENDS TO GIVE THE
PRESENTATION OR SUBMIT THE ARTICLE FOR PUBLICATION. THE
ADVANCE INFORMATION COPY MAY BE SUBMITTED IN THE FORMAT OR
MEDIUM WHICH WILL BE UTILIZED IN ITS ULTIMATE RELEASE.
L108 18. CROSS-WAIVER OF LIABILITY FOR SPACE STATION ACTIVITIES
NASA FAR SUPPLEMENT 18-52.228-76, "CROSS-WAIVER OF
LIABILITY FOR SPACE STATION ACTIVITIES," IS INCORPORATED
BY REFERENCE. "CONTRACTOR" MEANS SELLER.
**CONTINUED ON NEXT PAGE**
<PAGE> 19
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3283 04 6
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
L112 19. CROSS-WAIVER OF LIABILITY
FOR THE PURPOSES OF NASA CLAUSE 18-52.228-76,
"CROSS-WAIVER OF LIABILITY FOR SPACE STATION ACTIVITIES,"
RUSSIA SHALL BE CONSIDERED A "PARTNER STATE" EVEN THOUGH
THEY HAVE NOT YET SIGNED THE INTERNATIONAL GOVERNMENTAL
AGREEMENT (IGA) SINCE RUSSIA HAS AGREED TO A SPACE STATION
CROSS-WAIVER OF LIABILITY UNDER THE INTERIM AGREEMENT FOR
SPACE STATION BETWEEN THE UNITED STATES AND RUSSIA, DATED
JUNE 23, 1994.
N11O 20. DESIGNATION OF NEW TECHNOLOGY REPRESENTATIVE AND PATENT
REPRESENTATIVE
(A) FOR PURPOSES OF FACILITATING ADMINISTRATION OF THE
CLAUSE OF THIS CONTRACT ENTITLED "NEW TECHNOLOGY",
NASA FAR SUPP. 18-52.227-70, THE NEW TECHNOLOGY
REPRESENTATIVE AND PATENTS REPRESENTATIVE
DESIGNATED BY THE CONTRACTING OFFICER ARE
IDENTIFIED IN PARAGRAPH C. HEREOF.
(B) REPORTS OF REPORTABLE ITEMS AND DISCLOSURE OF
SUBJECT INVENTIONS, INTERIM REPORTS, FINAL
REPORTS, UTILIZATION REPORTS, AND OTHER REPORTS
REQUIRED BY THE CLAUSE, SHOULD BE DIRECTED TO THE
NEW TECHNOLOGY REPRESENTATIVE UNLESS TRANSMITTED
IN RESPONSE TO CORRESPONDENCE OR REQUEST FROM THE
PATENTS REPRESENTATIVE. THIS PROVISION SHALL BE
INCLUDED IN ANY SUBCONTRACT HEREUNDER REQUIRING
THE "NEW TECHNOLOGY" CLAUSE OR OTHER PATENTS
RIGHTS CLAUSE UNLESS OTHERWISE AUTHORIZED OR
DIRECTED BY THE CONTRACTING OFFICER.
(C) THE NEW TECHNOLOGY REPRESENTATIVE AND PATENTS
REPRESENTATIVE ARE: NEW TECHNOLOGY REPRESENTATIVE:
TECHNOLOGY UTILIZATION OFFICER
OFFICE CODE: 1C4
NASA LYNDON B. JOHNSON SPACE CENTER
HOUSTON, TX 77058
PATENTS REPRESENTATIVE:
PATENT COUNSEL
OFFICE CODE: HA
NASA LYNDON B. JOHNSON SPACE CENTER
**CONTINUED ON NEXT PAGE**
<PAGE> 20
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3283 04 7
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
HOUSTON, TX 77058
N138 21. DELETION OF FAR 52.227-12
FAR 52.227-12 "PATENT RIGHTS RETENTION BY THE CONTRACTOR
(LONG FORM)," INCLUDED IN THE GENERAL PROVISIONS FORM
INCORPORATED BY REFERENCE, IS DELETED.
R154 23. NASA SMALL DISADVANTAGED BUSINESS GOAL
NASA FAR SUPP. 18-52.219-76, "NASA SMALL DISADVANTAGE
BUSINESS GOAL" IS INCORPORATED BY REFERENCE.
BTPE 25. PLEASE RETURN ACCEPTANCE COPY OF THIS PURCHASE CONTRACT
AND ALL CORRESPONDENCE TO:
THE BOEING COMPANY
SPACE STATION INTEGRATION
P.O. BOX 58747
HOUSTON, TX 77258
TERESA A. KELLY HF-96
BTQ2 26. VENDOR WILL COMPLY WITH THE HAZARD COMMUNICATIONS
STANDARD, 29 CFR 1910.1200, IF APPLICABLE. INITIALLY,
ALL MATERIAL SAFETY DATA SHEETS SHALL BE PROVIDED TO:
SAFETY, HEALTH & ENVIRONMENTAL AFFAIRS (SHEA)
THE BOEING COMPANY
P.O. BOX 240002, M/S JM-30
HUNTSVILLE, AL 35824-6402
AND, INCLUDE AN MSDS IN ALL SUBSEQUENT SHIPMENTS FOR THIS
CONTRACT.
BTRW 27. INSTALLATION (SITE) SECURITY
SELLER, ITS EMPLOYEES AND OTHER AGENTS, AND EMPLOYEES AND
OTHER AGENTS OF SUBCONTRACTORS SHALL COMPLY FULLY WITH
PHYSICAL, FIRE, OR OTHER PUBLISHED SECURITY REGULATIONS
WHILE ON PREMISES UNDER BUYER'S CONTROL.
FNO1 28. ATTACHMENT A
THE CONTRACT LABOR EMPLOYEES AND APPLICABLE BILLING RATES
ARE SET FORTH IN ATTACHMENT A TO THIS CONTRACT.
**CONTINUED ON NEXT PAGE**
<PAGE> 21
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3283 04 8
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
FNO2 29. ATTACHMENT B
ADDITIONAL PROVISIONS APPLICABLE TO WORK PERFORMED AT
NASA-JSC., ARE INCLUDED AS ATTACHMENT B TO THIS CONTRACT.
FNO4 31. INDEPENDENT CONTRACTOR AND LABOR REQUIREMENTS
A. SELLER IS PROVIDING SERVICES AS AN INDEPENDENT
CONTRACTOR. PERSONNEL ASSIGNED BY SELLER ARE NOT
EMPLOYEES OF BUYER, BUT ARE SELLER'S EMPLOYEES AND
SUBJECT TO THE RULES, REGULATIONS, AND MANAGEMENT
OF SELLER. SELLER'S EMPLOYEES SHALL BE PAID
EXCLUSIVELY BY SELLER AND SELLER SHALL BE
RESPONSIBLE FOR COMPLIANCE WITH ALL REQUIREMENTS
RELATING TO ITS EMPLOYEES UNDER LOCAL, STATE, AND
FEDERAL LAWS AND REGULATIONS, INCLUDING BUT NOT
LIMITED TO LAWS AND REGULATIONS GOVERNING MINIMUM
WAGE, SOCIAL SECURITY, IMMIGRATION AND
NATURALIZATION, UNEMPLOYMENT INSURANCE, INCOME
TAX, AND WORKMENS COMPENSATION. ALL TAX
OBLIGATIONS ASSOCIATED WITH THIS PURCHASE CONTRACT
ARE THE SOLE RESPONSIBILITY OF SELLER. IN THE
EVENT BUYER IS ASSESSED OR NOTIFIED OF ANY SUCH
TAXES, BUYER SHALL NOTIFY SELLER AND SELLER SHALL
PROMPTLY PAY THE AMOUNT OF SUCH ASSESSMENTS TO THE
PROPER AUTHORITY. AT THE REQUEST OF BUYER, SELLER
SHALL GIVE REASONABLE EVIDENCE OF COMPLIANCE WITH
ALL SUCH LEGAL REQUIREMENTS AND OBLIGATIONS.
B. ALL WORK SHALL BE PERFORMED AT BUYER'S FACILITIES
UNLESS OTHERWISE REQUESTED AND AUTHORIZED BY
BUYER.
C. - DELETED -
D. SELLER SHALL INSTRUCT ITS EMPLOYEES NOT TO DIVULGE
OR DISCUSS WITH BUYER'S EMPLOYEES ANY TERMS OF
THIS ORDER, INCLUDING THE RATES OF PAY. ANY
VIOLATION OF THIS PROVISION WILL ENTITLE BUYER TO
REQUEST SUCH EMPLOYEE BE WITHDRAWN FROM
PERFORMANCE UNDER THIS ORDER.
E. NEITHER SELLER NOR ITS AGENTS OR REPRESENTATIVES
SHALL OFFER OR EXTEND GRATUITIES, SUCH AS GIFTS OR
ENTERTAINMENT TO ANY OF BUYER'S EMPLOYEES,
REGARDLESS OF THE PURPOSE OR INTENT.
**CONTINUED ON NEXT PAGE**
<PAGE> 22
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3283 04 10
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SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
WORK AND ALL EXCLUSIVE RIGHTS UNDER SUCH COPYRIGHT
SHALL BE ASSIGNED AND TRANSFERRED TO BUYER OR ITS
DESIGNEE.
FNO8 35. EMPLOYEE ASSIGNMENT
THE SUBCONTRACTOR SHALL ASSIGN EMPLOYEES TO THIS CONTRACT
WHO POSSESS THE QUALIFICATIONS TO PERFORM THE REQUIRED
SERVICES. THE PRIME CONTRACTOR HAS THE RIGHT TO ACCEPT OR
REJECT ASSIGNED SUBCONTRACTOR PERSONNEL. IF REQUESTED, THE
SUBCONTRACTOR SHALL REMOVE ANY PERSONNEL FOR CAUSE. SELLER
SHALL NOTIFY BUYER REGARDING THE NEED TO OBTAIN
REPLACEMENT EMPLOYEE(S). RESUMES WILL BE SUBMITTED FOR ALL
REPLACEMENT EMPLOYEES.
THE PRIME CONTRACTOR ALSO RESERVES THE RIGHT TO REDUCE THE
QUANTITY OF PERSONNEL ASSIGNED, INCLUDING BUT NOT LIMITED
TO, NON-REPLACEMENT OF PERSONNEL WHO RESIGN OR ARE EXCUSED
FOR CAUSE.
FNO9 36. BILLING
IN ACCORDANCE WITH BOEING POLICIES REGARDING CONTRACT
LABOR UNDER A LABOR HOUR CONTRACT. BOEING'S SALCO
TIMEKEEPING SYSTEM SHALL BE UTILIZED TO MONITOR SELLER
EMPLOYEE TIME.
COMPENSATION SHALL BE BASED UPON HOURS ACCRUED IN THE
SALCO TIMEKEEPING SYSTEM AND THE INDIVIDUAL RATES
IDENTIFIED IN 'ATTACHMENT A' OF THIS CONTRACT. PAYMENT
SHALL BE AUTOMATICALLY ISSUED TO SUPPLIER: SUPPLIER SHALL
NOT ISSUE INVOICE TO BOEING. PAYMENT WILL BE ACCOMPLISHED
ON A MONTHLY BASIS.
PROMPT PAYMENT DISCOUNT .5%, 10 DAYS, NET 30
FN1O 37. EMPLOYEE RATES
UPON AGREEMENT ON AN INDIVIDUAL CANDIDATE, THE BUYER AND
SELLER WILL AGREE ON INDIVIDUALS' BILLING RATE FOR
STRAIGHT TIME AND OVERTIME. BUYER RESERVES THE RIGHT TO
NEGOTIATE A APPLICABLE RATES TO LABOR HOUR EMPLOYEES WITH
SELLER.
FN11 38. TRAVEL
**CONTINUED ON NEXT PAGE**
<PAGE> 23
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3283 04 11
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SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
SELLER'S EMPLOYEE MUST HAVE BOEING MANAGEMENT APPROVAL
PRIOR TO ANY BUSINESS TRAVEL. SELLER SHALL HAVE THE OPTION
OF DETERMINING METHOD OF TRAVEL ACCOUNTING AS FOLLOWS:
1. SELLER-ARRANGED TRAVEL
- DELETE -
2. BOEING-ARRANGED TRAVEL
TRAVEL PERFORMED IN SUPPORT OF THIS CONTRACT WILL BE
HANDLED IN ACCORDANCE WITH ESTABLISHED BOEING TRAVEL
POLICIES AND PROCEDURES. UNDER THIS METHOD EMPLOYEE
MUST COMPLETE TRIP REQUEST AND TRAVEL AUTHORIZATION
FORMS. BOEING WILL THEN BE RESPONSIBLE FOR ALL TRAVEL
PLANNING OF HOTEL AND RENTAL CAR AND THE ISSUANCE OF
TICKETS.
FN12 39. VACATIONS
SELLER'S PERSONNEL OR MANAGEMENT WILL REQUEST AND SCHEDULE
VACATIONS IN ADVANCE WITH THE COGNIZANT BOEING TECHNICAL
SUPERVISOR. ALL VACATIONS MUST BE APPROVED BY BOEING TO
AVOID DISRUPTION.
FN13 40. CONTRACT CHANGES
THE MATERIAL BUYER TERESA KELLY, OR HER DESIGNEE, IS THE
ONLY PERSON AUTHORIZED BY THE BOEING COMPANY TO CHANGE OR
MODIFY ANY REQUIREMENTS OF THE CONTRACT THAT WOULD AFFECT
PRICE, SCHEDULE, OR TERMS AND CONDITIONS.
FN14 41. SELLER'S EMPLOYEES SHALL ADHERE TO BUYER'S ESTABLISHED
HOLIDAY SCHEDULE FOR DURATION OF CONTRACT.
PCO1 42. THIS CHANGE IS BEING ISSUED TO:
1. DEFINITIZE PURCHASE CONTRACT IN THE AMOUNT OF
$14,601,110.00
2. DELETE SPECIAL PROVISION A4
3. DELETE TYPING NOTES A18O (REPLACE WITH A184) AND A337
4. DELETE FREE NOTE FNO3
5. REDUCE CONTRACT VALUE IN THE AMOUNT OF $398,890.00
(SEE #1 ABOVE)
6. ADD LINE ITEMS 2, 3 AND 4
7. ADD FREE NOTES FN15, FN16 AND FN17
**CONTINUED ON NEXT PAGE**
<PAGE> 24
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3283 04 12
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
8. DELETE TYPING NOTES G243 AND R16O
9. REVISE FREE NOTES FNO4, FNO9, FN11 AND FN12
10. DELETE SPECIAL PROVISIONS E25 AND P20
(NOT APPLICABLE)
11. DELETE TYPING NOTES G226 AND G228 (NOT APPLICABLE)
FN15 44 OPTION TO EXTEND
BOEING RESERVES THE RIGHT TO EXERCISE THE OPTION (PRICED)
TO EXTEND BY PROVIDING NOTIFICATION TO THE SUPPLIER PRIOR
TO THE EXPIRATION OF ANY PERIOD OF PERFORMANCE. THE
OPTIONS ARE IDENTIFIED ON THE FACE OF THIS CONTRACT AS
LINE ITEMS.
FN16 45. BURDEN RATES ARE DEPENDENT UPON HEADCOUNT. HEADCOUNT RANGE
IS AS FOLLOWS: 51-90. MEMORANDUM OF AGREEMENT (MOA),
SIGNED BY BOEING AND DYNACS, IS INCORPORATED HEREIN BY
REFERENCE.
FN17 46. BURDEN RATES ARE IN ACCORDANCE WITH ATTACHMENT A FOR A
CURRENT HEADCOUNT RANGE OF 51-90. OVERTIME IS ALLOTTED AT
5 PERCENT.
PCO2 47. THIS CHANGE IS BEING ISSUED TO:
1. ADD FREE NOTES FN18 AND FN19
2. ADD NOTE A396
3. REVISE TYPING NOTE P152
4. DELETE TYPING NOTE A184
5. REVISE LINE ITEMS 1 THROUGH 4 (TO CLARIFY CHARGE
LINE ASSIGNMENT AND ESTABLISH DOLLAR VALUES FOR EACH
PERIOD OF PERFORMANCE)
A39B 48. CORRECTION OF SPECIAL PROVISION P30
SPECIAL PROVISION P30, "LIMITATION ON PAYMENTS TO
INFLUENCE CERTAIN FEDERAL TRANSACTIONS," IS REVISED BY
DELETING REFERENCE TO "SUBPARAGRAPH (B)(3)(III)" AND
"SUBSTITUTING SUBPARAGRAPH (C)."
P152 49. WHEREVER REFERENCE IS MADE IN THIS CONTRACT TO A FAR, FAR
SUPPLEMENT, DAR, NASA PR OR FPR CLAUSE, SUCH CLAUSE SHALL
BE DEEMED TO BE THE ONE IN EFFECT ON THE DATE SET FORTH
BELOW:
DATE 01/95
FN1B 50. SUM ALLOTTED/PERIOD OF PERFORMANCE
-
THE SUM ALLOTTED TO THIS CONTRACT AND THE PERIOD OF
**CONTINUED ON NEXT PAGE**
<PAGE> 25
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3283 04 13
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
PERFORMANCE COVERED BY THIS SUM ARE:
A) NOT-TO-EXCEED $23,759,71O.00
1. THE NOT-TO-EXCEED VALUE FOR THIS EFFORT IS AS
STATED ABOVE UNLESS A CONTRACT CHANGE OR
MODIFICATION IS ISSUED TO AMEND THE CEILING PRICE.
THE BUYER SHALL NOT BE OBLIGATED TO REIMBURSE THE
SELLER FOR COSTS INCURRED IN EXCESS OF THE CEILING
PRICE, UNLESS A WRITTEN CONTRACT CHANGE/
MODIFICATION IS ISSUED.
2. THE LOT PRICING AS SHOWN IS NOT TO BE CONSTRUED AS
REQUIRING THE BUYER TO EXPEND THE TOTAL DOLLARS AS
SHOWN, BUT IS USED AS A "NOT-TO-EXCEED" FIGURE
ONLY.
B) PERIOD OF PERFORMANCE: AS SHOWN ON EACH LINE ITEM.
FN19 51. APPLICABLE PRIME CONTRACT: NAS15-10000
PRIORITY RATING: DO-C9 (REF.: TYPING NOTE A261)
PCO3 52. THIS CHANGE IS BEING ISSUED TO:
1. INCREASE DOLLAR VALUE TO ALLOW FOR A HEADCOUNT
INCREASE OF 43 PEOPLE. DOLLAR VALUES WILL INCREASE
ON LINE ITEMS 1 THROUGH 3, ACCORDING TO OPTION
YEARS.
2. ADD LINE ITEM 5 FOR RELOCATION (MOVING) EXPENSES.
$10,022 IS MOVED FROM ITEM 1 TO ITEM 5 AND AN
ADDITIONAL AMOUNT OF $15,000 IS INCLUDED FOR THIS
CONTRACT CHANGE FOR A TOTAL AMOUNT OF $25,022.
3. REVISE FREE NOTE FN18 - SUM ALLOTTED AMOUNT.
PCO4 53. THIS IS AN ADMINISTRATIVE CONTRACT CHANGE
BEING ISSUED TO ADD THE BOOZE-ALLEN & HAMILTON, INC. AND
LOCKHEED MARTIN CONTRACT LABOR SUPPORT FROM THE GRUMMAN
CONTRACT. THE MONEY WAS TRANSFERED FROM THE GRUMMAN
CONTRACT TO THIS DYNACS CONTRACT.
INCREASE DOLLAR VALUE BY $1,093,542.00 TO ITEM 3 TO COVER
FY97 FOR THE ABOVE PEOPLE FOR A NEW TOTAL CONTRACT VALUE
$23,759,710.00.
REVISE NOTE BTPE 25 FROM TERESA A. KELLY M/S HF-96 TO
MARGARET BLACKWELL M/S HS-41 OR ADD NOTE FN2O.
ADD TYPING NOTE G11O
REVISE NOTE FN18 FROM NOT TO EXCEED OF $22,666,167.00 TO
$23,759,710.00.
G11O 54. SUM ALLOTTED/PERFORMANCE PERIOD
EXCEPT AS MAY BE SET FORTH IN SEPARATE CORRESPONDENCE
SIGNED BY BUYER'S MATERIEL REPRESENTATIVE, THE SUM
**CONTINUED ON NEXT PAGE**
<PAGE> 26
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3283 04 14
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
ALLOTTED TO THIS CONTRACT, COVERING ALL ITEMS, AND THE
ESTIMATED PERIOD OF PERFORMANCE COVERED BY THIS SUM ARE,
RESPECTIVELY:
$23,759,710.00 NTE AND PERIOD OF PERFORMANCE AS SHOWN ON
EACH ITEM.
FN2O 55. PLEASE RETURN ACCEPTANCE COPY OF THIS PURCHASE ORDER AND
ALL CORRESPONDENCE TO:
THE BOEING COMPANY
SPACE STATION INTEGRATION
P.O. BOX 58747
HOUSTON, TX 77258
ATTN: MARGARET BLACKWELL M/S HS-41
**CONTINUED ON NEXT PAGE**
<PAGE> 27
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP HX3283 04 2
-----------------------------------
- -------------------------------------------------------------------------------
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
GENERAL INSTRUCTIONS
A. THE PURCHASE CONTRACT NUMBER SHOWN ON THE FACE OF THE ORDER AND THE
APPLICABLE ITEM NUMBER(S) MUST APPEAR ON ALL INVOICES AND CORRESPONDENCE
PERTAINING TO THIS CONTRACT.
B. REFER OR ADDRESS ALL INQUIRIES REGARDING THIS CONTRACT (EXCEPT
INVOICES), TO THE BUYER AT THE BOEING MAIL STOP SPECIFIED ON THIS
CONTRACT. INVOICES ARE TO BE MAILED TO THE ATTENTION OF ACCOUNTS PAYABLE
(BOEING DEFENSE & SPACE GROUP, P.O. BOX 34113, SEATTLE, WA 98124-1113).
C. YOUR BILLING UNIT OF MEASURE (U/M) MUST BE THE SAME AS THE U/M ORDERED,
UNLESS OTHERWISE NOTED. UNIT PRICES SHOWN IN THIS CONTRACT ARE NET AND
APPLICABLE TRADE DISCOUNTS HAVE BEEN CONSIDERED. FEDERAL EXCISE TAX. IF
ANY, MUST BE SHOWN AS A SEPARATE ITEM ON YOUR INVOICES. TWO COPIES OF
ALL INVOICES MUST BE SUBMITTED, ONE COPY MUST BE MARKED ORIGINAL
D. ALL ITEMS SHALL BE TO THE LATEST DRAWINGS AND SPECIFICATIONS UNLESS
EXCEPTIONS ARE SPECIFIED IN THIS CONTRACT.
SHIPPING INSTRUCTIONS
A. ALL SHIPMENTS WHICH ARE F.O.B. SHIPPING POINT ARE TO BE SHIPPED COLLECT
WHEN CONSIGNED TO A BOEING ADDRESS. F.O.B. DESTINATION SHIPMENTS TO BE
SHIPPED PREPAID VIA CARRIER OF YOUR CHOICE. PLEASE INDICATE DESTINATION
ZIP CODE, SPECIFIC STREET AND BUILDING ADDRESS ON ALL SHIPMENTS.
B. ALL SHIPMENTS FROM HUNTSVILLE COMMERCIAL ZONE THAT ARE F.O.B. SHIPPING
POINT SHOULD BE SHIPPED VIA UNITED PARCEL SERVICE (UPS) OR BOEING
LICENSED TRANSPORTATION.
C. BOEING PURCHASE CONTRACT NUMBER(S) AND ITEM NUMBER(S) MUST APPEAR ON ALL
PACKING SHEETS AND FREIGHT BILLS, INCLUDING THIRD PARTY FREIGHT BILLS.
D. CONSOLIDATE ALL COLLECT SHIPMENTS TO BE FORWARDED VIA THE SAME
TRANSPORTATION MODE ON ANY ONE DAY TO ANY ONE CONSIGNMENT ADDRESS.
E. DO NOT COMBINE SHIPMENTS FOR VARIOUS BOEING COMPANIES AND DIVISIONS
UNLESS SPECIFICALLY INSTRUCTED.
F. DO NOT INSURE OR DECLARE VALUE ON ANY SHIPMENT EXCEPT TO OBTAIN LOWEST
RATES WHEN BASED ON A RELEASED VALUE
G. SHIPMENTS FROM OUTSIDE USA MUST BE ACCOMPANIED BY PRICED INVOICE FOR
U.S. CUSTOMS CLEARANCE.
H. ADDITIONAL COPY OF PACKING LIST TO BE PLACED INSIDE PACKAGE
I. LIST NUMBER OF PACKAGES ON OUTSIDE OF PACKAGES. I.E (1of3, 2of3,
ETC.).
J. SURFACE SHIPMENTS OVER 5,000 POUNDS, OVER-DIMENSIONAL, REQUIRE SPECIAL
HANDLING, EXCLUSIVE USE OF VEHICLE, OR SPECIALIZED TRANSPORTATION
EQUIPMENT. PHONE TRAFFIC MANAGEMENT FOR SPECIFIC INSTRUCTIONS 48 HOURS
PRIOR TO SHIPMENT. CALL (205) 772-2616 or 2617.
K. AIR SHIPMENTS OVER 500 POUNDS, OVER-DIMENSIONAL OR REQUIRE SPECIAL
HANDLING. PHONE TRAFFIC MANAGEMENT FOR SPECIFIC INSTRUCTIONS 24 HOURS
PRIOR TO SHIPMENT. CALL (205) 772-2616-2617.
L. INSTRUCTIONS FOR DOMESTIC SHIPMENTS, INCLUDING GOVERNMENT BILL OF LADING
SHIPMENTS.
1. STANDARD (SURFACE SHIPMENTS 150 POUNDS OR LESS PER PIECE SHIP
VIA UNITED PARCEL SERVICE (UPS). SHIP COLLECT VIA THE CONSIGNEE
BILLING PROGRAM. FOR INFORMATION ON THIS PROGRAM CALL UPS AT
1-800-354-7527. (PLEASE REFERENCE THE BOEING PURCHASE ORDER
NUMBER ON ALL PIECES).
FOR STANDARD (SURFACE) SHIPMENTS FROM 151 POUNDS TO 5,000 POUNDS
SHIP VIA CF MOTORFREIGHT. SHIP COLLECT AND REFERENCE THE BOEING
PURCHASE ORDER NUMBER ON ALL SHIPMENTS.
2. SPECIFIC STREET AND BUILDING ADDRESS MUST BE SHOWN ON ALL
SHIPMENTS.
3. WHEN PURCHASE CONTRACT DIRECTS "SHIP VIA" GBL (GOVERNMENT BILL
OF LADING) OBTAIN SAME FROM YOUR REGIONAL DCMAO (DEFENSE
CONTRACT MANAGEMENT AREA OFFICE).
<PAGE> 28
THE BOEING COMPANY Acceptance Reqd |X|
DEFENSE & SPACE GROUP
P.O. BOX 240002 Special Contract Instructions
HUNTSVILLE, AL 35824-8402 are attached hereto
ATTN:
DYNACS ENGINEERING CO INC
28870 U.S. HWY. 19 N.
SUITE 405
CLEARWATER FL 34621
SUPPLIER COPY PURCHASE CONTRACT NO. PCC PAGE
JD7563 01 1
- -------------------------------------------------------------------------------
CONFIRM DATE RELEASE DATE
PURCHASE CONTRACT CHANGE 10/21/97
- -------------------------------------------------------------------------------
ADDRESS ALL INQUIRIES TO BUYER: STATE SALES OR USE TAX STATUS
M. S. BLACKWELL |_| SUBJECT TO TAX
|X| FOR RESALE NOT SUBJECT TO TX TAX
- -------------------------------------------------------------------------------
MAIL STOP AREA CODE/PHONE NO. CERT NO.
HF-96 (713) 336-5012 1-91-0425694-6
- -------------------------------------------------------------------------------
PAYMENT TERMS SHIPPING TOLERANCE
1/2% 10TH NET 30 OVER % UNDER %
- -------------------------------------------------------------------------------
PRIME CONTRACT NO. RATING ALLOTMENT
CONTRACT LABOR-9
- -------------------------------------------------------------------------------
SHIP VIA: F.O.B. POINT FREIGHT ALLOWANCE
NOT APPLICABLE NOT APPLICABLE NONE
- -------------------------------------------------------------------------------
SHIP TO: ORIGINAL PC RELEASE DATE
NONE 10/15/97
- -------------------------------------------------------------------------------
THE FOLLOWING CLAUSES OF FORM D1-4305-1500 (REV 02/96) ARE PART OF THIS CONTRACT
G4 G8 G16 G21 I1 L1 P2 P32
- -------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
1 1.00 LT CONTRACT LABOR PER JOB DESCRIPTIONS
(SEE FNO2 AND ATTACHMENT 1 FOR RATES) 20000000.00
PERIOD OF PERFORMANCE
OCTOBER 1, 1997 THRU SEPTEMBER 30, 1999
THE WORK ORDER CHARGE IS 7 -91055-H32O-JD7563
A200 01. CONTRACT PROVISIONS
THE GENERAL PROVISIONS FORM INCORPORATED
INTO THIS CONTRACT BY REFERENCE IS:
IS: (DF4400-918 GENERAL PROVISION, LABOR HOUR
CONTRACT)
A203 02. PURCHASE CONTRACT EXHIBITS
THE FOLLOWING EXHIBIT(S) IS(ARE)
ATTACHED TO AND MADE A PART OF THIS
CONTRACT: (ATTACHMENT A - JOHNSON SPACE CENTER
EXHIBIT A - GOVERNMENT PROVISIONS
APPLICABLE TO PRIME CONTRACT
NAS15-10000)
A322 03. CERTIFICATION AND DISCLOSURE REGARDING PAYMENTS TO
INFLUENCE CERTAIN FEDERAL TRANSACTIONS
FAR 52.203-11, "CERTIFICATION AND DISCLOSURE REGARDING
PAYMENTS TO INFLUENCE CERTAIN FEDERAL TRANSACTIONS," IS
**CONTINUED ON NEXT PAGE**
<PAGE> 29
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 2
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
INCORPORATED HEREIN BY REFERENCE. SELLER'S SIGNED PROPOSAL
PROVIDED THE REQUIRED CERTIFICATION.
A362 04. "MANNED SPACE FLIGHT ITEM
FOR USE IN MANNED SPACE FLIGHT; MATERIALS, MANUFACTURING
AND WORKMANSHIP OF HIGHEST QUALITY STANDARDS ARE ESSENTIAL
TO ASTRONAUT SAFETY.
IF YOU ARE ABLE TO SUPPLY THE DESIRED ITEM WITH A HIGHER
QUALITY THAN THAT OF THE ITEMS SPECIFIED OR PROPOSED, YOU
ARE REQUESTED TO BRING THIS FACT TO THE IMMEDIATE
ATTENTION OF THE BUYER.
A393 05. "MISSION CRITICAL SPACE SYSTEMS PERSONNEL
RELIABILITY PROGRAM
NASA FAR SUPPLEMENT 18-52.246-70, 'MISSION CRITICAL SPACE
SYSTEMS PERSONNEL RELIABILITY PROGRAM,' IS INCORPORATED BY
REFERENCE."
B158 06. EMERGENCY EVACUATION PROCEDURES
NASA FAR SUPPLEMENT 18-52.237-70, "EMERGENCY EVACUATION
PROCEDURES," IS INCORPORATED BY REFERENCE. "CONTRACTING
OFFICER" MEANS CONTRACTING OFFICER OR BUYER.
F272 07. "TRANSFER OF TECHNICAL DATA AND GOODS - EXPORT CONTROL
REGULATIONS
A. IN PERFORMANCE OF WORK AUTHORIZED UNDER THIS CONTRACT,
THE SELLER AND ITS SUBCONTRACTORS SHALL, AS NECESSARY,
DELIVER, DISCLOSE OR TRANSFER (EXPORT) TO A FOREIGN ENTITY
OR PERSON, TECHNICAL DATA, COMPUTER SOFTWARE OR EQUIPMENT
PURSUANT TO NASA CONTROL AND GUIDELINES WHICH MAY BE
SUBJECT TO THE EXPORT LICENSE JURISDICTION OF THE COMMERCE
DEPARTMENT EXPORT ADMINISTRATION REGULATIONS (EAR) OR THE
STATE DEPARTMENT INTERNATIONAL TRAFFIC ARMS REGULATIONS
(ITAR).
B. IN PROCESSING SUCH EXPORTS, THE SELLER AND ITS
SUBCONTRACTORS SHALL USE RELEVANT REGULATORY EXEMPTIONS OR
OTHER APPROVALS WHICH APPLY (E.G., A GENERAL LICENSE UNDER
THE EAR, OR AN EXEMPTION UNDER THE ITAR), PURSUANT TO THIS
CLAUSE, AND SHALL ABIDE BY ANY REGULATORY
**CONTINUED ON NEXT PAGE**
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THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 3
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
REQUIREMENTS FOR SUCH EXPORTS. SHOULD NO REGULATORY
EXEMPTION OR OTHER APPROVAL EXIST, THE SELLER SHALL INFORM
NASA AND SHALL PROVIDE THE NECESSARY DOCUMENTATION IN
ORDER FOR NASA TO OBTAIN ANY REQUIRED APPROVAL.
C. ANY EXPORT AFFECTED PURSUANT TO THIS CLAUSE SHALL BE
LIMITED TO ONLY THAT TECHNICAL DATA, COMPUTER SOFTWARE AND
HARDWARE NECESSARY TO DEFINE OR CARRY OUT NASA'S
RESPONSIBILITIES IN THE INTERNATIONAL SPACE STATION ALPHA
PROGRAM.
D. THE SELLER, SUBJECT TO NASA AND/OR BUYER CONTROL AND
GUIDELINES, IS AUTHORIZED TO PROVIDE THIS DIRECTION IN ALL
SPACE STATION SUBCONTRACTS AT ANY TIER, THE PERFORMANCE OF
WHICH MAY REQUIRE THE DEVELOPMENT, DELIVERY OR USE OF
TECHNICAL DATA, COMPUTER SOFTWARE, HARDWARE AND FOR WHICH
A NEED EXISTS TO EFFECT THE EXPORT BY THE SUBCONTRACTOR."
F277 08. "IDENTIFICATION AND APPROVAL FOR USE OF RESTRICTED
COMPUTER SOFTWARE AND/OR COMMERCIAL COMPUTER SOFTWARE
A. THE SELLER SHALL IDENTIFY, IN WRITING, UPON
DEFINITIZATION, ALL RESTRICTED COMPUTER SOFTWARE AND/OR
COMMERCIAL COMPUTER SOFTWARE, AS DEFINED IN THE 'RIGHTS IN
DATA-GENERAL' AND THE 'COMMERCIAL COMPUTER SOFTWARE
LICENSING' CLAUSES OF THIS CONTRACT, THAT WILL BE
DELIVERED IN PERFORMANCE OF THIS CONTRACT. THE BUYER SHALL
APPROVE OR DISAPPROVE, IN WRITING, USE OF THE IDENTIFIED
SOFTWARE WITHIN 75 DAYS FROM RECEIPT OF REQUEST.
B. THE SELLER SHALL BE RESPONSIBLE FOR NOTIFYING THE BUYER
ON A CONTINUOUS BASIS OF ADDITIONAL RESTRICTED COMPUTER
SOFTWARE AND/OR COMMERCIAL COMPUTER SOFTWARE NEEDED.
C. IF THE BUYER DISAPPROVES THE USE OF RESTRICTED COMPUTER
SOFTWARE AND/OR COMMERCIAL COMPUTER SOFTWARE, WHEN SUCH
SOFTWARE IS IDENTIFIED, THE SELLER MAY SUBMIT A PROPOSAL
FOR EQUITABLE ADJUSTMENT TO THE BUYER. SUCH PROPOSALS
SHALL BE HANDLED ACCORDING TO THE PROVISIONS OF THE
'CHANGES' CLAUSE OF THIS CONTRACT.
L108 09. CROSS-WAIVER OF LIABILITY FOR SPACE STATION ACTIVITIES
NASA FAR SUPPLEMENT 18-52.228-76. "CROSS-WAIVER OF
LIABILITY FOR SPACE STATION ACTIVITIES," IS INCORPORATED
BY REFERENCE. "CONTRACTOR" MEANS SELLER.
**CONTINUED ON NEXT PAGE**
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THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 4
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
L112 10. CROSS-WAIVER OF LIABILITY
FOR THE PURPOSES OF NASA CLAUSE 18-52.228-76,
"CROSS-WAIVER OF LIABILITY FOR SPACE STATION ACTIVITIES,"
RUSSIA SHALL BE CONSIDERED A "PARTNER STATE" EVEN THOUGH
THEY HAVE NOT YET SIGNED THE INTERNATIONAL GOVERNMENTAL
AGREEMENT (IGA) SINCE RUSSIA HAS AGREED TO A SPACE STATION
CROSS-WAIVER OF LIABILITY UNDER THE INTERIM AGREEMENT FOR
SPACE STATION BETWEEN THE UNITED STATES AND RUSSIA, DATED
JUNE 23, 1994.
P118 11. FOR THE CONSIDERATIONS CONTAINED IN THIS CONTRACT, BUYER
SHALL HAVE THE RIGHT AND OPTION TO PURCHASE, AND SELLER
HEREBY AGREES TO SELL TO BUYER UPON RECEIPT OF BUYER'S
NOTICE EXERCISING THE OPTION, THE FOLLOWING ITEM(S),
WITHIN THE QUANTITIES AND TO THE SCHEDULE(S) SET FORTH
BELOW, AND UPON THE TERMS AND CONDITIONS AND OTHER
PROVISIONS OF THIS CONTRACT. BUYER MAY EXERCISE ANY OR ALL
OF THE FOREGOING OPTION(S) BY ISSUANCE OF SAID NOTICE(S)
NOT LATER THAN THE DATE(S) SHOWN IN THE COLUMN ENTITLED
"OPTIONS EXERCISE DATE(S)", BELOW. SELLER'S FAILURE TO
MEET CONTRACT PERFORMANCE SCHEDULES OR MILESTONES LEADING
UP TO BUYER'S DECISION TO EXERCISE THE FOLLOWING OPTION(S)
SHALL RESULT IN A DAY-FOR-DAY SLIDE IN THE OPTION EXERCISE
DATE(S). EACH PROPOSAL SUBMITTED BY SELLER PURSUANT TO THE
"CHANGES" CLAUSE OF THIS CONTRACT SHALL INCLUDE SELLER'S
PROPOSED ADJUSTMENT, IF ANY, TO THE UNIT PRICE(S) SET
FORTH BELOW, DIRECTLY CAUSED BY THE CHANGES(S) TO WHICH
SUCH PROPOSAL RELATES. SELLER SHALL NOT BE ENTITLED TO ANY
ADJUSTMENT OF THESE UNIT PRICE(S) BEYOND THAT NEGOTIATED
BY BUYER AND SELLER AS A RESULT OF SUCH PROPOSAL.
QUANTITY ITEM UNIT PRICE SCHEDULE OPTION EXERCISE DATE(S)
1 LT 2 $10000000. N/A FY00 10/1/2000
1 LT 3 $10000000. N/A F701 10/1/2001
R171 12. BUSINESS SIZE CERTIFICATION
IN ACCORDANCE WITH SELLER'S CURRENT BUSINESS SIZE
CERTIFICATION (FORM DO-6000-4195), OR OTHER INFORMATION
PROVIDED TO THE BUYER, SELLER'S BUSINESS SIZE HAS BEEN
ESTABLISHED AS SET FORTH BELOW. IF THIS BUSINESS SIZE IS
NOT CORRECT, SELLER SHALL IMMEDIATELY NOTIFY THE BUYER'S
MATERIEL REPRESENTATIVE.
SELLER'S CURRENT BUSINESS SIZE IS:(SMALL MINORITY
BUSINESS)
**CONTINUED ON NEXT PAGE**
<PAGE> 32
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 5
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SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
0P33 13. EMPLOYEE RATES
UPON AGREEMENT ON AN INDIVIDUAL CANDIDATE, BOEING BUYER
AND SELLER WILL AGREE ON INDIVIDUAL'S BILLING RATE FOR
STRAIGHT TIME AND OVERTIME. BUYER RESERVES THE RIGHT TO
NEGOTIATE OVERHEAD, G&A AND PROFIT RATES FOR CONTRACT
LABOR EMPLOYEES WITH SELLER.
BOEING HUMAN RESOURCES, DAN ROBINSON (281) 283-4345 OR HIS
AUTHORIZED REPRESENTATIVE AND THE SELLER WILL NEGOTIATE
AND AGREE ON INDIVIDUAL'S DIRECT LABOR RATE FOR STRAIGHT
TIME AND OVERTIME.
0P34 14. TRAVEL
TRAVEL PERFORMED IN SUPPORT OF THIS CONTRACT WILL BE
HANDLED IN ACCORDANCE WITH ESTABLISHED BOEING TRAVEL
POLICIES AND PROCEDURES.
BOEING TRAVEL SERVICES (281) 338-4673, AT 2100 SPACE PARK
DRIVE BUILDING, ROOM 1D17, WILL PLAN AND ARRANGE ALL
TRAVEL.
SELLER'S EMPLOYEE MUST HAVE BOEING MANAGEMENT APPROVAL
PRIOR TO ANY BUSINESS TRAVEL.
CONTRACT LABOR EMPLOYEE WILL COMPLETE TRIP REQUEST AND
TRAVEL AUTHORIZATION FORMS.
BOEING WILL THEN BE RESPONSIBLE FOR ALL TRAVEL PLANNING
AND THE ISSUANCE OF TICKETS.
TRAVEL AT ACTUAL COST WHICH WOULD INCLUDE:
COACH AIRFARE BOOKED IN ADVANCE
LODGING
RENTAL CAR
GAS
MEALS
BOEING TRAVEL OFFICE WILL ISSUE TRAVELER CHECKS PER
BOEING REQUIREMENTS TO COVER EXPENSES.
FEES ARE NOT INCLUDED (SUCH AS OVERHEAD, G&A, AND PROFIT).
TRAVEL EXPENSE REPORTS, BOEING FORM D0-6000-4630 REV. 7/93
**CONTINUED ON NEXT PAGE**
<PAGE> 33
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 6
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
WILL BE FILLED OUT, SIGNED BY CONTRACT EMPLOYEE AND
HIS/HER BOEING SUPERVISOR AND SUBMITTED TO BOEING TRAVEL
OFFICE WITHIN TEN (10) CALENDAR DAYS AFTER RETURN DATE OF
TRAVEL.
SUPPLIER DOES NOT INVOICE FOR TRAVEL SERVICES, CONTRACT
LABOR WILL BE PROCESSED FOR TRAVEL, AS BOEING EMPLOYEES
ARE PROCESSED THROUGH BOEING TRAVEL SERVICES.
0P35 15. BILLING
IN ACCORDANCE WITH BOEING POLICIES REGARDING CONTRACT
LABOR UNDER A LABOR HOUR CONTRACT, BOEING ELECTRONIC
TIMEKEEPING SYSTEM (ETS) SHALL BE UTILIZED TO
MONITOR/REPORT SELLER EMPLOYEE TIME.
COMPENSATION SHALL BE BASED UPON HOURS ACCRUED IN THE ETS
AND THE INDIVIDUAL RATES WILL BE IDENTIFIED AS AN
"ATTACHMENT A" TO ANY RESULTING CONTRACT. PAYMENT SHALL BE
AUTOMATICALLY ISSUED TO SUPPLIER PER BILLING RATE WHICH
INCLUDES DIRECT LABOR OVERHEAD, GENERAL AND ADMINISTRATIVE
RATES, AND PROFIT. SUPPLIER SHALL NOT ISSUE INVOICE TO
BOEING. PAYMENT WILL BE ACCOMPLISHED ON A MONTHLY BASIS.
0P36 18. COMPENSATION
AS FULL COMPENSATION FOR THE PERFORMANCE OF THIS ORDER,
UNLESS OTHERWISE PROVIDED IN THE ORDER, BUYER SHALL PAY
SELLER AT THE RATES SET FORTH IN THE ORDER FOR ALL
SERVICES PROVIDED HEREUNDER BY SELLER'S EMPLOYEES PLUS,
FOR ANY TRAVEL REQUIRED AS DETERMINED IN TRAVEL NOTE BT
0P34 OF THIS ORDER. SAID RATES COVER ALL WAGES AND
SALARIES, OVERHEAD, G&A, AND PROFIT AND OTHER COSTS AND
EXPENSES OF SELLER INCIDENT TO THIS ORDER, EXCEPT SUCH
COSTS AND EXPENSES AS MAY BE COVERED BY TRAVEL NOTE BT
0P34, OR OTHER COSTS OR ALLOWANCES SPECIFICALLY PROVIDED
FOR IN THE ORDER.
BUYER'S STANDARD WORK WEEK BEGINS ON FRIDAY AND ENDS ON
THE FOLLOWING THURSDAY.
OVERTIME OR OTHER PREMIUM RATES, IF ANY, WILL NOT BE PAID
UNLESS THE PERFORMANCE OF THE OVERTIME OR OTHER
PREMIUM-PAY WORK HAS THE PRIOR APPROVAL OF BOEING
MANAGEMENT.
A. OVERTIME
OVERTIME SHALL BE PAID AT THE OVERTIME LABOR RATES FOR
**CONTINUED ON NEXT PAGE**
<PAGE> 34
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 7
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
QUALIFYING SELLER'S PERSONNEL. OVERTIME COMPENSATION
SHALL BE AT THE RATES AGREED TO BETWEEN BUYER AND
SELLER. OVERTIME SHALL BE DETERMINED AS FOLLOWS.
(1) BUYER CONSIDERS OVERTIME AS ANY TIME EXPENDED
BEYOND A NORMAL 40 HOUR WORK WEEK (INCLUDING
WEEKENDS AS REGULAR TIME). OVERTIME SHOULD BE
CHARGED ONLY AFTER 40 REGULAR HOURS.
(2) BUYER CONSIDERS OVERTIME DURING A BOEING HOLIDAY
WORK WEEK TO BE ANY TIME EXPENDED BEYOND 32-HOUR
WORK WEEK (INCLUDING WEEKENDS & HOLIDAYS AS
REGULAR TIME). OVERTIME SHOULD BE CHARGED ONLY
AFTER 32 REGULAR HOURS.
B. HOLIDAY
SELLER'S EMPLOYEES SHALL ADHERE TO BUYER'S ESTABLISHED
HOLIDAY SCHEDULE FOR DURATION OF CONTRACT.
FY98 SCHEDULE FY99 SCHEDULE
------------------------ ----------------------------
NOVEMBER 27 AND 28, 1997 NOVEMBER 26 AND 27, 1998
DECEMBER 24, 1997 THRU DECEMBER 24, 1998 THRU
JANUARY 1, 1998 JANUARY 1, 1999
MAY 25, 1998 MAY 25, 1999
JULY 3, 1998 JULY 5, 1999
SEPTEMBER 7, 1998 SEPTEMBER 6, 1999
BOEING DOES NOT PAY FOR HOLIDAYS IF NOT WORKED.
0P37 17. INDEPENDENT CONTRACTOR AND LABOR REQUIREMENTS
A. SELLER IS PROVIDING SERVICES AS AN INDEPENDENT
CONTRACTOR. PERSONNEL ASSIGNED BY SELLER ARE NOT EMPLOYEES
OF BUYER, BUT ARE SELLER'S EMPLOYEES AND SUBJECT TO THE
RULES, REGULATIONS AND MANAGEMENT OF SELLER. SELLER'S
EMPLOYEES SHALL BE PAID EXCLUSIVELY BY SELLER AND SELLER
SHALL BE RESPONSIBLE FOR COMPLIANCE WITH ALL REQUIREMENTS
RELATING TO ITS EMPLOYEES UNDER LOCAL, STATE, AND FEDERAL
LAWS AND REGULATIONS, INCLUDING BUT NOT LIMITED TO LAWS
AND REGULATIONS GOVERNING MINIMUM WAGE. SOCIAL SECURITY,
IMMIGRATION AND NATURALIZATION, UNEMPLOYMENT INSURANCE,
INCOME TAX, AND WORKMENS COMPENSATION. ALL TAX OBLIGATIONS
ASSOCIATED WITH THIS PURCHASE CONTRACT ARE THE SOLE
RESPONSIBILITY OF SELLER. IN THE EVENT BUYER IS ASSESSED
**CONTINUED ON NEXT PAGE**
<PAGE> 35
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 8
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
OR NOTIFIED OF ANY SUCH TAXES, BUYER SHALL NOTIFY SELLER
AND SELLER SHALL PROMPTLY PAY THE AMOUNT OF SUCH
ASSESSMENTS TO THE PROPER AUTHORITY. AT THE REQUEST OF
BUYER, SELLER SHALL GIVE REASONABLE EVIDENCE OF COMPLIANCE
WITH ALL SUCH LEGAL REQUIREMENTS AND OBLIGATIONS.
B. ALL WORK SHALL BE PERFORMED AT BUYER'S FACILITIES
UNLESS OTHERWISE REQUESTED AND AUTHORIZED BY BUYER.
C. SELLER SHALL NOT RECRUIT OR INDUCE BUYER'S PERMANENT
EMPLOYEE TO BECOME EMPLOYEES OF SELLER DURING THE TERM OF
THIS ORDER OR FOR A PERIOD OF SIX (6) MONTHS THEREAFTER.
D. SELLER SHALL INSTRUCT ITS EMPLOYEES NOT TO DIVULGE OR
DISCUSS WITH BUYER'S EMPLOYEES ANY TERMS OF THIS ORDER,
INCLUDING THE RATES OF PAY. ANY VIOLATION OF THIS
PROVISION WILL ENTITLE BUYER TO REQUEST SUCH EMPLOYEE BE
WITHDRAWN FROM PERFORMANCE UNDER THIS ORDER.
E. NEITHER SELLER NOR ITS AGENTS OR REPRESENTATIVES SHALL
OFFER OR EXTEND GRATUITIES, SUCH AS GIFTS OR ENTERTAINMENT
TO ANY OF BUYER'S EMPLOYEES, REGARDLESS OF THE PURPOSE OF
INTENT.
F. SELLER SHALL NOT SUBCONTRACT FOR ANY OF THE SERVICES TO
BE PROVIDED UNDER THIS CONTRACT WITHOUT THE PRIOR WRITTEN
CONSENT OF BUYER.
0P38 18. EMPLOYEE ASSIGNMENT
THE SUBCONTRACTOR SHALL ASSIGN EMPLOYEES TO THIS CONTRACT
WHO POSSESS THE QUALIFICATIONS TO PERFORM THE REQUIRED
SERVICES. THE PRIME CONTRACTOR HAS THE RIGHT TO ACCEPT OR
REJECT ASSIGNED SUBCONTRACTOR PERSONNEL. IF REQUESTED, THE
SUBCONTRACTOR SHALL REMOVE ANY PERSONNEL FOR CAUSE, SELLER
SHALL NOTIFY BUYER REGARDING THE NEED TO OBTAIN
REPLACEMENT EMPLOYEE(S). RESUMES WILL BE SUBMITTED FOR ALL
REPLACEMENT EMPLOYEES.
THE PRIME CONTRACTOR ALSO RESERVES THE RIGHT TO REDUCE THE
QUANTITY OF PERSONNEL ASSIGNED, INCLUDING BUT NOT LIMITED
TO, NON-REPLACEMENT OF PERSONNEL WHO RESIGN OR ARE EXCUSED
FOR CAUSE.
0P39 19. VACATIONS
**CONTINUED ON NEXT PAGE**
<PAGE> 36
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 9
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
SELLER'S PERSONNEL OR MANAGEMENT WILL REQUEST AND SCHEDULE
VACATIONS IN ADVANCE WITH THE COGNIZANT BOEING SUPERVISOR.
ALL VACATIONS MUST BE APPROVED BY BOEING TO AVOID
DISRUPTION
0P40 20. INSTALLATION (SITE) SECURITY
SELLER, ITS EMPLOYEES AND OTHER AGENTS, AND EMPLOYEES AND
OTHER AGENTS OF SUBCONTRACTOR SHALL COMPLY WITH PHYSICAL,
FIRE, OR OTHER PUBLISHED SECURITY REGULATIONS WHILE ON
PREMISES UNDER BUYER'S CONTROL.
0P41 21. COPYRIGHT
ANY COMPUTER SOFTWARE OR OTHER WORK PREPARED BY ANY OF
SELLER'S PERSONNEL IN THE COURSE OF OR AS A RESULT OF ANY
ASSIGNMENT UNDER ANY CONTRACT SHALL:
I. BE A "WORK MADE FOR HIRE" TO WHICH COPYRIGHT
VESTS WITH BUYER OR ITS DESIGNEE, OR
II. IF ANY SUCH WORK IS NOT A "WORK MADE BY HIRE" BY
OPERATION OF LAW, THE COPYRIGHT SUBSISTING IN
SUCH WORK AND ALL EXCLUSIVE RIGHTS UNDER SUCH
COPYRIGHT SHALL BE ASSIGNED AND TRANSFERRED TO
BUYER OR ITS DESIGNEE.
0P42 22. REQUEST FOR RESUMES
BUYER'S HUMAN RESOURCES DEPARTMENTS WILL PERIODICALLY
REQUEST RESUMES FOR SPECIFIC JOB CLASSIFICATIONS. SELLER
WILL ONLY SUBMIT THE REQUESTED NUMBER OF RESUMES FOR THE
IDENTIFIED JOB CLASSIFICATION. SELLER WILL NOT SUBMIT
RESUMES TO ANY OTHER DEPARTMENT OF THE BOEING COMPANY
OTHER THAN THE HUMAN RESOURCES DEPARTMENT. UNSOLICITED
RESUMES WILL NOT BE SUBMITTED BY THE SELLER.
0P43 23. BOEING BUYER TYPING NOTES 0P34 AND 0P35 SUPERSEDES
SECTIONS 5.D AND 6 ON FORM DF4400-918 (REV. 2/97) GENERAL
PROVISIONS (LABOR HOUR CONTRACT).
FNOI 24. FUNDING/SUM ALLOTTED
THE SUM ALLOTTED $20,000,000.00 TO THIS CONTRACT IS EQUAL
TO THE TOTAL PURCHASE CONTRACT VALUE. THE SUPPLIER MUST
NOTIFY THE BUYER WHEN 80% OF THE SUM ALLOTTED VALUE IS
EXPENDED. NO COSTS IN EXCESS OF THE SUM ALLOTTED SHALL BE
INCURRED
**CONTINUED ON NEXT PAGE**
<PAGE> 37
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 10
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M.S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
WITHOUT A CONTRACT CHANGE TO AUTHORIZE AN INCREASE IN THE
PURCHASE CONTRACT VALUE.
THE SUM ALLOTTED STATED HEREIN IS A NOT-TO-EXCEED VALUE
FOR A TWO (2) YEAR PERIOD FROM OCTOBER 1, 1997 THRU
SEPTEMBER 30, 1999 FOR THE PAYMENT OF HOURS EXPENDED IN
PERFORMANCE OF THE SPECIFIED IN THE JOB DESCRIPTION(S). IT
IS NOT A GUARANTEE OF WORK EQUAL TO THE SUM ALLOTTED
VALUE.
FNO2 25. RATES ARE AS FOLLOWS:
101-125 OVERHEAD G&A
1998 33.20% 0.90%
1999 33.20% 0.80%
2000 33.20% 0.80%
2001 33.20% 0.70%
PROFIT FEE IS 4.00% FOR ALL NUMBERS OF PEOPLE AND YEARS.
SUBCONTRACTING COST IS THE SAME AS G&A BASIC PROPOSAL
SEE ATTACHMENT I FOR ALL OVERHEAD, G&A AND PROFIT RATES
FOR ALL NUMBERS OF PEOPLE AND YEARS.
PCOI 26. REVISE PAYMENT TERMS FROM NET 30 DAYS TO 1/2% NET 10 DAYS
**CONTINUED ON NEXT PAGE**
<PAGE> 38
- --------------------------------------------------------------------------------
THIS CONTRACT INSTRUMENT IS BUYER OFFER TO SELLER AND ACCEPTANCE IS LIMITED TO
ACCEPTANCE OF ITS PROVISIONS WITHOUT ADDITION, DELETION, OR OTHER MODIFICATION.
- --------------------------------------------------------------------------------
ALL ITEMS SHALL BE TO THE LATEST DRAWINGS AND SPECIFICATIONS UNLESS EXCEPTIONS
ARE SPECIFIED IN THIS ORDER.
- --------------------------------------------------------------------------------
PLEASE ACCOMPLISH THIS ACCEPTANCE AND RETURN WITHIN FIVE (5) DAYS TO THE BUYER
AND MAIL STOP IDENTIFIED BELOW
- --------------------------------------------------------------------------------
RETURN TO:
THE BOEING COMPANY
DEFENSE & SPACE GROUP
P.O. BOX 240002
HUNSTVILLE, AL 35824-6402
- --------------------------------------------------------------------------------
We accept this entire purchase contract or purchase contract change (P.C.C.)
including all of the terms and conditions hereof. If this is a P.C.C., Seller,
in addition, agrees that Seller is not entitled to any further adjustments in
the price (or estimated cost or fee), delivery schedule or other provisions of
the purchase contract in connection with the changes made or covered by such
P.C.C.
- --------------------------------------------------------------------------------
SELLER
- --------------------------------------------------------------------------------
BY DATE
- --------------------------------------------------------------------------------
THE BOEING COMPANY
DEFENSE & SPACE GROUP
ATTN:
DYNACS ENGINEERING CO INC
28870 U.S. HWY. 19 N.
SUITE 405
CLEARWATER FL 34621
ACCEPTANCE COPY PURCHASE CONTRACT NO. PCC PAGE
JD7563 01 1
- -------------------------------------------------------------------------------
CONFIRM DATE RELEASE DATE
PURCHASE CONTRACT CHANGE 10/21/97
- -------------------------------------------------------------------------------
ADDRESS ALL INQUIRIES TO BUYER: STATE SALES OR USE TAX STATUS
M. S. BLACKWELL |_| SUBJECT TO TAX
|X| FOR RESALE NOT SUBJECT TO TX TAX
- -------------------------------------------------------------------------------
MAIL STOP AREA CODE/PHONE NO. CERT NO.
HS-41 (713) 336-5012 1-91-0425694-6
- -------------------------------------------------------------------------------
PAYMENT TERMS SHIPPING TOLERANCE
1/2% 10TH NET 30 OVER % UNDER %
- -------------------------------------------------------------------------------
PRIME CONTRACT NO. RATING ALLOTMENT
CONTRACT LABOR-9
- -------------------------------------------------------------------------------
SHIP VIA: F.O.B. POINT FREIGHT ALLOWANCE
NOT APPLICABLE NOT APPLICABLE NONE
- -------------------------------------------------------------------------------
SHIP TO: ORIGINAL PC RELEASE DATE
NONE 10/15/97
- -------------------------------------------------------------------------------
THE FOLLOWING CLAUSES OF FORM D1-4305-1500 (REV 02/96) ARE PART OF THIS CONTRACT
G4 G8 G16 G21 I1 L1 P2 P32
- -------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
1 1.00 LT CONTRACT LABOR PER JOB DESCRIPTIONS
(SEE FNO2 AND ATTACHEMENT 1 FOR RATES) 20000000.00
PERIOD OF PERFORMANCE OCTOBER 1, 1997 THRU
SEPTEMBER 30, 1999
THE WORK ORDER CHARGE IS 7 -91055-H320-JD7583
A200 01. CONTRACT PROVISIONS
THE GENERAL PROVISIONS FORM INCORPORATED INTO THIS
CONTRACT BY REFERENCE IS:
IS: (DF4400-918 GENERAL PROVISION, LABOR HOUR CONTRACT)
A203 02. PURCHASE CONTRACT EXHIBITS
THE FOLLOWING EXHIBIT(S) IS(ARE) ATTACHED TO AND MADE A
PART OF THIS CONTRACT:
(ATTACHMENT A - JOHNSON SPACE CENTER
EXHIBIT A - GOVERNMENT PROVISIONS APPLICABLE TO
PRIME CONTRACT NAS15-10000)
A322 03. CERTIFICATION AND DISCLOSURE REGARDING PAYMENTS TO
INFLUENCE CERTAIN FEDERAL TRANSACTIONS
FAR 52.203-11, "CERTIFICATION AND DISCLOSURE REGARDING
PAYMENTS TO INFLUENCE CERTAIN FEDERAL TRANSACTIONS," IS
**CONTINUED ON NEXT PAGE**
<PAGE> 39
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 2
-----------------------------------
ACCEPTANCE COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M. S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
INCORPORATED HEREIN BY REFERENCE. SELLER'S SIGNED PROPOSAL
PROVIDED THE REQUIRED CERTIFICATION.
A362 04. "MANNED SPACE FLIGHT ITEM
FOR USE IN MANNED SPACE FLIGHT; MATERIALS, MANUFACTURING
AND WORKMANSHIP OF HIGHEST QUALITY STANDARDS ARE ESSENTIAL
TO ASTRONAUT SAFETY.
IF YOU ARE ABLE TO SUPPLY THE DESIRED ITEM WITH A HIGHER
QUALITY THAN THAT OF THE ITEMS SPECIFIED OR PROPOSED, YOU
ARE REQUESTED TO BRING THIS FACT TO THE IMMEDIATE
ATTENTION OF THE BUYER.
A393 05. "MISSION CRITICAL SPACE SYSTEMS PERSONNEL
RELIABILITY PROGRAM
NASA FAR SUPPLEMENT 18-52.246-70, 'MISSION CRITICAL SPACE
SYSTEMS PERSONNEL RELIABILITY PROGRAM,' IS INCORPORATED BY
REFERENCE."
B158 06. EMERGENCY EVACUATION PROCEDURES
NASA FAR SUPPLEMENT 18-52.237-70, "EMERGENCY EVACUATION
PROCEDURES," IS INCORPORATED BY REFERENCE. "CONTRACTING
OFFICER" MEANS CONTRACTING OFFICER OR BUYER.
F272 07. "TRANSFER OF TECHNICAL DATA AND GOODS - EXPORT CONTROL
REGULATIONS
A. IN PERFORMANCE OF WORK AUTHORIZED UNDER THIS CONTRACT,
THE SELLER AND ITS SUBCONTRACTORS SHALL, AS NECESSARY,
DELIVER, DISCLOSE OR TRANSFER (EXPORT) TO A FOREIGN ENTITY
OR PERSON, TECHNICAL DATA, COMPUTER SOFTWARE OR EQUIPMENT
PURSUANT TO NASA CONTROL AND GUIDELINES WHICH MAY BE
SUBJECT TO THE EXPORT LICENSE JURISDICTION OF THE COMMERCE
DEPARTMENT EXPORT ADMINISTRATION REGULATIONS (EAR) OR THE
STATE DEPARTMENT INTERNATIONAL TRAFFIC ARMS REGULATIONS
(ITAR).
B. IN PROCESSING SUCH EXPORTS, THE SELLER AND ITS
SUBCONTRACTORS SHALL USE RELEVANT REGULATORY EXEMPTIONS OR
OTHER APPROVALS WHICH APPLY (E.G., A GENERAL LICENSE UNDER
THE EAR, OR AN EXEMPTION UNDER THE ITAR), PURSUANT TO THIS
CLAUSE, AND SHALL ABIDE BY ANY REGULATORY
**CONTINUED ON NEXT PAGE**
<PAGE> 40
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 3
-----------------------------------
ACCEPTANCE COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M. S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
REQUIREMENTS FOR SUCH EXPORTS. SHOULD NO REGULATORY
EXEMPTION OR OTHER APPROVAL EXIST, THE SELLER SHALL INFORM
NASA AND SHALL PROVIDE THE NECESSARY DOCUMENTATION IN
ORDER FOR NASA TO OBTAIN ANY REQUIRED APPROVAL.
C. ANY EXPORT AFFECTED PURSUANT TO THIS CLAUSE SHALL BE
LIMITED TO ONLY THAT TECHNICAL DATA, COMPUTER SOFTWARE AND
HARDWARE NECESSARY TO DEFINE OR CARRY OUT NASA'S
RESPONSIBILITIES IN THE INTERNATIONAL SPACE STATION ALPHA
PROGRAM.
D. THE SELLER, SUBJECT TO NASA AND/OR BUYER CONTROL AND
GUIDELINES, IS AUTHORIZED TO PROVIDE THIS DIRECTION IN ALL
SPACE STATION SUBCONTRACTS AT ANY TIER, THE PERFORMANCE OF
WHICH MAY REQUIRE THE DEVELOPMENT, DELIVERY OR USE OF
TECHNICAL DATA, COMPUTER SOFTWARE, HARDWARE AND FOR WHICH
A NEED EXISTS TO EFFECT THE EXPORT BY THE SUBCONTRACTOR."
F277 08. "IDENTIFICATION AND APPROVAL FOR USE OF RESTRICTED
COMPUTER SOFTWARE AND/OR COMMERCIAL COMPUTER SOFTWARE
A. THE SELLER SHALL IDENTIFY, IN WRITING, UPON
DEFINITIZATION, ALL RESTRICTED COMPUTER SOFTWARE AND/OR
COMMERCIAL COMPUTER SOFTWARE, AS DEFINED IN THE 'RIGHTS IN
DATA-GENERAL' AND THE 'COMMERCIAL COMPUTER SOFTWARE
LICENSING' CLAUSES OF THIS CONTRACT, THAT WILL BE
DELIVERED IN PERFORMANCE OF THIS CONTRACT. THE BUYER SHALL
APPROVE OR DISAPPROVE, IN WRITING, USE OF THE IDENTIFIED
SOFTWARE WITHIN 75 DAYS FROM RECEIPT OF REQUEST.
B. THE SELLER SHALL BE RESPONSIBLE FOR NOTIFYING THE BUYER
ON A CONTINUOUS BASIS OF ADDITIONAL RESTRICTED COMPUTER
SOFTWARE AND/OR COMMERCIAL COMPUTER SOFTWARE NEEDED.
C. IF THE BUYER DISAPPROVES THE USE OF RESTRICTED COMPUTER
SOFTWARE AND/OR COMMERCIAL COMPUTER SOFTWARE, WHEN SUCH
SOFTWARE IS IDENTIFIED, THE SELLER MAY SUBMIT A PROPOSAL
FOR EQUITABLE ADJUSTMENT TO THE BUYER. SUCH PROPOSALS
SHALL BE HANDLED ACCORDING TO THE PROVISIONS OF THE
'CHANGES' CLAUSE OF THIS CONTRACT."
LIO8 O9. CROSS-WAIVER OF LIABILITY FOR SPACE STATION ACTIVITIES
NASA FAR SUPPLEMENT 18-52.228-76. "CROSS-WAIVER OF
LIABILITY FOR SPACE STATION ACTIVITIES," IS INCORPORATED
BY REFERENCE. "CONTRACTOR" MEANS SELLER.
**CONTINUED ON NEXT PAGE**
<PAGE> 41
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 4
-----------------------------------
ACCEPTANCE COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M. S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
L112 10. CROSS-WAIVER OF LIABILITY
FOR THE PURPOSES OF NASA CLAUSE 18-52.228-76,
"CROSS-WAIVER OF LIABILITY FOR SPACE STATION ACTIVITIES,"
RUSSIA SHALL BE CONSIDERED A "PARTNER STATE" EVEN THOUGH
THEY HAVE NOT YET SIGNED THE INTERNATIONAL GOVERNMENTAL
AGREEMENT (IGA) SINCE RUSSIA HAS AGREED TO A SPACE STATION
CROSS-WAIVER OF LIABILITY UNDER THE INTERIM AGREEMENT FOR
SPACE STATION BETWEEN THE UNITED STATES AND RUSSIA, DATED
JUNE 23, 1994.
P118 11. FOR THE CONSIDERATIONS CONTAINED IN THIS CONTRACT, BUYER
SHALL HAVE THE RIGHT AND OPTION TO PURCHASE, AND SELLER
HEREBY AGREES TO SELL TO BUYER UPON RECEIPT OF BUYER'S
NOTICE EXERCISING THE OPTION, THE FOLLOWING ITEM(S),
WITHIN THE QUANTITIES AND TO THE SCHEDULE(S) SET FORTH
BELOW, AND UPON THE TERMS AND CONDITIONS AND OTHER
PROVISIONS OF THIS CONTRACT. BUYER MAY EXERCISE ANY OR ALL
OF THE FOREGOING OPTION(S) BY ISSUANCE OF SAID NOTICE(S)
NOT LATER THAN THE DATE(S) SHOWN IN THE COLUMN ENTITLED
"OPTIONS EXERCISE DATE(S)", BELOW. SELLER'S FAILURE TO
MEET CONTRACT PERFORMANCE SCHEDULES OR MILESTONES LEADING
UP TO BUYER'S DECISION TO EXERCISE THE FOLLOWING OPTION(S)
SHALL RESULT IN A DAY-FOR-DAY SLIDE IN THE OPTION EXERCISE
DATE(S). EACH PROPOSAL SUBMITTED BY SELLER PURSUANT TO THE
"CHANGES" CLAUSE OF THIS CONTRACT SHALL INCLUDE SELLER'S
PROPOSED ADJUSTMENT, IF ANY, TO THE UNIT PRICE(S) SET
FORTH BELOW, DIRECTLY CAUSED BY THE CHANGES(S) TO WHICH
SUCH PROPOSAL RELATES. SELLER SHALL NOT BE ENTITLED TO ANY
ADJUSTMENT OF THESE UNIT PRICE(S) BEYOND THAT NEGOTIATED
BY BUYER AND SELLER AS A RESULT OF SUCH PROPOSAL.
QUANTITY ITEM UNIT PRICE SCHEDULE OPTION EXERCISE DATE(S)
1 LT 2 $10000000. N/A FY00 10/1/2000
1 LT 3 $10000000. N/A F701 10/1/2001
R171 12. BUSINESS SIZE CERTIFICATION
IN ACCORDANCE WITH SELLER'S CURRENT BUSINESS SIZE
CERTIFICATION (FORM DO-6000-4195), OR OTHER INFORMATION
PROVIDED TO THE BUYER, SELLER'S BUSINESS SIZE HAS BEEN
ESTABLISHED AS SET FORTH BELOW. IF THIS BUSINESS SIZE IS
NOT CORRECT, SELLER SHALL IMMEDIATELY NOTIFY THE BUYER'S
MATERIEL REPRESENTATIVE.
SELLER'S CURRENT BUSINESS SIZE IS:(SMALL MINORITY
BUSINESS)
**CONTINUED ON NEXT PAGE**
<PAGE> 42
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 5
-----------------------------------
ACCEPTANCE COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M. S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
0P33 13. EMPLOYEE RATES
UPON AGREEMENT ON AN INDIVIDUAL CANDIDATE, BOEING BUYER
AND SELLER WILL AGREE ON INDIVIDUAL'S BILLING RATE FOR
STRAIGHT TIME AND OVERTIME. BUYER RESERVES THE RIGHT TO
NEGOTIATE OVERHEAD, G&A AND PROFIT RATES FOR CONTRACT
LABOR EMPLOYEES WITH SELLER.
BOEING HUMAN RESOURCES, DAN ROBINSON (281) 283-4345 OR HIS
AUTHORIZED REPRESENTATIVE AND THE SELLER WILL NEGOTIATE
AND AGREE ON INDIVIDUAL'S DIRECT LABOR RATE FOR STRAIGHT
TIME AND OVERTIME.
0P34 14. TRAVEL
TRAVEL PERFORMED IN SUPPORT OF THIS CONTRACT WILL BE
HANDLED IN ACCORDANCE WITH ESTABLISHED BOEING TRAVEL
POLICIES AND PROCEDURES.
BOEING TRAVEL SERVICES (281) 336-4673, AT 2100 SPACE PARK
DRIVE BUILDING, ROOM 1D17, WILL PLAN AND ARRANGE ALL
TRAVEL.
SELLER'S EMPLOYEE MUST HAVE BOEING MANAGEMENT APPROVAL
PRIOR TO ANY BUSINESS TRAVEL.
CONTRACT LABOR EMPLOYEE WILL COMPLETE TRIP REQUEST AND
TRAVEL AUTHORIZATION FORMS.
BOEING WILL THEN BE RESPONSIBLE FOR ALL TRAVEL PLANNING
AND THE ISSUANCE OF TICKETS.
TRAVEL AT ACTUAL COST WHICH WOULD INCLUDE:
COACH AIRFARE BOOKED IN ADVANCE
LODGING
RENTAL CAR
GAS
MEALS
BOEING TRAVEL OFFICE WILL ISSUE TRAVELER CHECKS PER
BOEING REQUIREMENTS TO COVER EXPENSES.
FEES ARE NOT INCLUDED (SUCH AS OVERHEAD, G&A, AND PROFIT).
TRAVEL EXPENSE REPORTS, BOEING FORM DO-6000-463O REV. 7/93
**CONTINUED ON NEXT PAGE**
<PAGE> 43
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 6
-----------------------------------
ACCEPTANCE COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M. S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
WILL BE FILED OUT SIGNED BY CONTRACT EMPLOYEE AND HIS/HER
BOEING SUPERVISOR AND SUBMITTED TO BOEING TRAVEL OFFICE
WITHIN TEN (10) CALENDAR DAYS AFTER RETURN DATE OF TRAVEL.
SUPPLIER DOES NOT INVOICE FOR TRAVEL SERVICES, CONTRACT
LABOR WILL BE PROCESSED FOR TRAVEL, AS BOEING EMPLOYEES
ARE PROCESSED THROUGH BOEING TRAVEL SERVICES.
0P35 15. BILLING
IN ACCORDANCE WITH BOEING POLICIES REGARDING CONTRACT
LABOR UNDER A LABOR HOUR CONTRACT, BOEING ELECTRONIC
TIMEKEEPING SYSTEM (ETS) SHALL BE UTILIZED TO
MONITOR/REPORT SELLER EMPLOYEE TIME.
COMPENSATION SHALL BE BASED UPON HOURS ACCRUED IN THE ETS
AND THE INDIVIDUAL RATES WILL BE IDENTIFIED AS AN
"ATTACHMENT A" TO ANY RESULTING CONTRACT. PAYMENT SHALL BE
AUTOMATICALLY ISSUED TO SUPPLIER PER BILLING RATE WHICH
INCLUDES DIRECT LABOR OVERHEAD, GENERAL AND ADMINISTRATIVE
RATES, AND PROFIT. SUPPLIER SHALL NOT ISSUE INVOICE TO
BOEING. PAYMENT WILL BE ACCOMPLISHED ON A MONTHLY BASIS.
0P36 16. COMPENSATION
AS FULL COMPENSATION FOR THE PERFORMANCE OF THIS ORDER
UNLESS OTHERWISE PROVIDED IN THE ORDER, BUYER SHALL PAY
SELLER AT THE RATES SET FORTH IN THE ORDER FOR ALL
SERVICES PROVIDED HEREUNDER BY SELLER'S EMPLOYEES PLUS,
FOR ANY TRAVEL REQUIRED AS DETERMINED IN TRAVEL NOTE BT
0P34 OF THIS ORDER. SAID RATES COVER ALL WAGES AND
SALARIES, OVERHEAD, G&A, AND PROFIT AND OTHER COSTS AND
EXPENSES OF SELLER INCIDENT TO THIS ORDER, EXCEPT SUCH
COSTS AND EXPENSES AS MAY BE COVERED BY TRAVEL NOTE BT
0P34, OR OTHER COSTS OR ALLOWANCES SPECIFICALLY PROVIDED
FOR IN THE ORDER.
BUYER'S STANDARD WORK WEEK BEGINS ON FRIDAY AND ENDS ON
THE FOLLOWING THURSDAY.
OVERTIME OR OTHER PREMIUM RATES. IF ANY, WILL NOT BE PAID
UNLESS THE PERFORMANCE OF THE OVERTIME OR OTHER
PREMIUM-PAY WORK HAS THE PRIOR APPROVAL OF BOEING
MANAGEMENT.
A. OVERTIME
OVERTIME SHALL BE PAID AT THE OVERTIME LABOR
RATES FOR
**CONTINUED ON NEXT PAGE**
<PAGE> 44
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 7
-----------------------------------
ACCEPTANCE COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M. S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
QUALIFYING SELLER'S PERSONNEL. OVERTIME COMPENSATION SHALL
BE AT THE RATES AGREED TO BETWEEN BUYER AND SELLER.
OVERTIME SHALL BE DETERMINED AS FOLLOWS.
(1) BUYER CONSIDERS OVERTIME AS ANY TIME EXPENDED
BEYOND A NORMAL 40 HOUR WORK WEEK (INCLUDING
WEEKENDS AS REGULAR TIME). OVERTIME SHOULD BE
CHARGED ONLY AFTER 40 REGULAR HOURS.
(2) BUYER CONSIDERS OVERTIME DURING A BOEING HOLIDAY
WORK WEEK TO BE ANY TIME EXPENDED BEYOND 32-HOUR
WORK WEEK (INCLUDING WEEKENDS & HOLIDAYS AS
REGULAR TIME). OVERTIME SHOULD BE CHARGED ONLY
AFTER 32 REGULAR HOURS.
B. HOLIDAY
SELLER'S EMPLOYEES SHALL ADHERE TO BUYER'S
ESTABLISHED HOLIDAY SCHEDULE FOR DURATION OF
CONTRACT.
FY98 SCHEDULE FY99 SCHEDULE
------------- -------------
NOVEMBER 27 AND 28, 1997 NOVEMBER 26 AND 27, 1998
DECEMBER 24, 1997 THRU DECEMBER 24, 1998 THRU
JANUARY 1, 1998 JANUARY 1, 1999
MAY 25, 1998 MAY 25, 1999
JULY 3, 1998 JULY 5, 1999
SEPTEMBER 7, 1998 SEPTEMBER 6, 1999
BOEING DOES NOT PAY FOR HOLIDAYS IF NOT WORKED.
0P37 17. INDEPENDENT CONTRACTOR AND LABOR REQUIREMENTS
A. SELLER IS PROVIDING SERVICES AS AN INDEPENDENT
CONTRACTOR. PERSONNEL ASSIGNED BY SELLER ARE NOT EMPLOYEES
OF BUYER, BUT ARE SELLER'S EMPLOYEES AND SUBJECT TO THE
RULES, REGULATIONS AND MANAGEMENT OF SELLER. SELLER'S
EMPLOYEES SHALL BE PAID EXCLUSIVELY BY SELLER AND SELLER
SHALL BE RESPONSIBLE FOR COMPLIANCE WITH ALL REQUIREMENTS
RELATING TO ITS EMPLOYEES UNDER LOCAL, STATE, AND FEDERAL
LAWS AND REGULATIONS, INCLUDING BUT NOT LIMITED TO LAWS
AND REGULATIONS GOVERNING MINIMUM WAGE, SOCIAL SECURITY,
IMMIGRATION AND NATURALIZATION, UNEMPLOYMENT INSURANCE,
INCOME TAX, AND WORKMENS COMPENSATION. ALL TAX OBLIGATIONS
ASSOCIATED WITH THIS PURCHASE CONTRACT ARE THE SOLE
RESPONSIBILITY OF SELLER. IN THE EVENT BUYER IS ASSESSED
**CONTINUED ON NEXT PAGE**
<PAGE> 45
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 8
-----------------------------------
ACCEPTANCE COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M. S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
OR NOTIFIED OF ANY SUCH TAXES, BUYER SHALL NOTIFY SELLER
AND SELLER SHALL PROMPTLY PAY THE AMOUNT OF SUCH
ASSESSMENTS TO THE PROPER AUTHORITY. AT THE REQUEST OF
BUYER, SELLER SHALL GIVE REASONABLE EVIDENCE OF COMPLIANCE
WITH ALL SUCH LEGAL REQUIREMENTS AND OBLIGATIONS.
B. ALL WORK SHALL BE PERFORMED AT BUYER'S FACILITIES
UNLESS OTHERWISE REQUESTED AND AUTHORIZED BY BUYER.
C. SELLER SHALL NOT RECRUIT OR INDUCE BUYER'S PERMANENT
EMPLOYEE TO BECOME EMPLOYEES OF SELLER DURING THE TERM OF
THIS ORDER OR FOR A PERIOD OF SIX (6) MONTHS THEREAFTER.
D. SELLER SHALL INSTRUCT ITS EMPLOYEES NOT TO DIVULGE OR
DISCUSS WITH BUYER'S EMPLOYEES ANY TERMS OF THIS ORDER,
INCLUDING THE RATES OF PAY. ANY VIOLATION OF THIS
PROVISION WILL ENTITLE BUYER TO REQUEST SUCH EMPLOYEE BE
WITHDRAWN FROM PERFORMANCE UNDER THIS ORDER.
E. NEITHER SELLER NOR ITS AGENTS OR REPRESENTATIVES SHALL
OFFER OR EXTEND GRATUITIES, SUCH AS GIFTS OR ENTERTAINMENT
TO ANY OF BUYER'S EMPLOYEES, REGARDLESS OF THE PURPOSE OF
INTENT.
F. SELLER SHALL NOT SUBCONTRACT FOR ANY OF THE SERVICES TO
BE PROVIDED UNDER THIS CONTRACT WITHOUT THE PRIOR WRITTEN
CONSENT OF BUYER.
0P38 18. EMPLOYEE ASSIGNMENT
THE SUBCONTRACTOR SHALL ASSIGN EMPLOYEES TO THIS CONTRACT
WHO POSSESS THE QUALIFICATIONS TO PERFORM THE REQUIRED
SERVICES. THE PRIME CONTRACTOR HAS THE RIGHT TO ACCEPT OR
REJECT ASSIGNED SUBCONTRACTOR PERSONNEL. IF REQUESTED, THE
SUBCONTRACTOR SHALL REMOVE ANY PERSONNEL FOR CAUSE, SELLER
SHALL NOTIFY BUYER REGARDING THE NEED TO OBTAIN
REPLACEMENT EMPLOYEE(S). RESUMES WILL BE SUBMITTED FOR ALL
REPLACEMENT EMPLOYEES.
THE PRIME CONTRACTOR ALSO RESERVES THE RIGHT TO REDUCE THE
QUANTITY OF PERSONNEL ASSIGNED, INCLUDING BUT NOT LIMITED
TO, NON-REPLACEMENT OF PERSONNEL WHO RESIGN OR ARE EXCUSED
FOR CAUSE.
0P39 19. VACATIONS
**CONTINUED ON NEXT PAGE**
<PAGE> 46
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 11
-----------------------------------
- --------------------------------------------------------------------------------
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M. S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
GENERAL INSTRUCTIONS
A. THE PURCHASE CONTRACT NUMBER SHOWN ON THE FACE OF THE ORDER AND THE
APPLICABLE ITEM NUMBER(S) MUST APPEAR ON ALL INVOICES AND CORRESPONDENCE
PERTAINING TO THIS CONTRACT.
B. REFER OR ADDRESS ALL INQUIRIES REGARDING THIS CONTRACT (EXCEPT
INVOICES), TO THE BUYER AT THE BOEING MAIL STOP SPECIFIED ON THIS
CONTRACT. INVOICES ARE TO BE MAILED TO THE ATTENTION OF ACCOUNTS PAYABLE
(BOEING DEFENSE & SPACE GROUP, P.O. BOX 34113, SEATTLE, WA 98124-1113).
C. YOUR BILLING UNIT OF MEASURE (U/M) MUST BE THE SAME AS THE U/M ORDERED,
UNLESS OTHERWISE NOTED. UNIT PRICES SHOWN IN THIS CONTRACT ARE NET AND
APPLICABLE TRADE DISCOUNTS HAVE BEEN CONSIDERED. FEDERAL EXCISE TAX, IF
ANY, MUST BE SHOWN AS A SEPARATE ITEM ON YOUR INVOICES. TWO COPIES OF
ALL INVOICES MUST BE SUBMITTED, ONE COPY MUST BE MARKED ORIGINAL.
D. ALL ITEMS SHALL BE TO THE LATEST DRAWINGS AND SPECIFICATIONS UNLESS
EXCEPTIONS ARE SPECIFIED IN THIS CONTRACT.
SHIPPING INSTRUCTIONS
A. ALL SHIPMENTS WHICH ARE F.O.B. SHIPPING POINT ARE TO BE SHIPPED COLLECT
WHEN CONSIGNED TO A BOEING ADDRESS. F.O.B. DESTINATION SHIPMENTS TO BE
SHIPPED PREPAID VIA CARRIER OF YOUR CHOICE. PLEASE INDICATE DESTINATION
ZIP CODE, SPECIFIC STREET AND BUILDING ADDRESS ON ALL SHIPMENTS.
B. ALL SHIPMENTS FROM HUNTSVILLE COMMERCIAL ZONE THAT ARE F.O.B. SHIPPING
POINT SHOULD BE SHIPPED VIA UNITED PARCEL SERVICE (UPS) OR BOEING
LICENSED TRANSPORTATION.
C. BOEING PURCHASE CONTRACT NUMBER(S) AND ITEM NUMBER(S) MUST APPEAR ON ALL
PACKING SHEETS AND FREIGHT BILLS, INCLUDING THIRD PARTY FREIGHT BILLS.
D. CONSOLIDATE ALL COLLECT SHIPMENTS TO BE FORWARDED VIA THE SAME
TRANSPORTATION MODE ON ANY ONE DAY TO ANY ONE CONSIGNMENT ADDRESS.
E. DO NOT COMBINE SHIPMENTS FOR VARIOUS BOEING COMPANIES AND DIVISIONS
UNLESS SPECIFICALLY INSTRUCTED.
F. DO NOT INSURE OR DECLARE VALUE ON ANY SHIPMENT EXCEPT TO OBTAIN LOWEST
RATES WHEN BASED ON A RELEASED VALUE.
G. SHIPMENTS FROM OUTSIDE USA MUST BE ACCOMPANIED BY PRICED INVOICE FOR
U.S. CUSTOMS CLEARANCE.
H. ADDITIONAL COPY OF PACKING LIST TO BE PLACED INSIDE PACKAGE.
I. LIST NUMBER OF PACKAGES ON OUTSIDE OF PACKAGES, I.E. (1of3, 2of3,
ETC.).
J. SURFACE SHIPMENTS OVER 5,000 POUNDS, OVER-DIMENSIONAL, REQUIRE SPECIAL
HANDLING, EXCLUSIVE USE OF VEHICLE, OR SPECIALIZED TRANSPORTATION
EQUIPMENT, PHONE TRAFFIC MANAGEMENT FOR SPECIFIC INSTRUCTIONS 48 HOURS
PRIOR TO SHIPMENT. CALL (205) 772-2616 or 2617.
K. AIR SHIPMENTS OVER 500 POUNDS, OVER-DIMENSIONAL OR REQUIRE SPECIAL
HANDLING, PHONE TRAFFIC MANAGEMENT FOR SPECIFIC INSTRUCTIONS 24 HOURS
PRIOR TO SHIPMENT. CALL (205) 772-2616-2617.
L. INSTRUCTIONS FOR DOMESTIC SHIPMENTS, INCLUDING GOVERNMENT BILL OF LADING
SHIPMENTS.
1. STANDARD (SURFACE) SHIPMENTS 150 POUNDS OR LESS PER PIECE SHIP
VIA UNITED PARCEL SERVICE (UPS). SHIP COLLECT VIA THE CONSIGNEE
BILLING PROGRAM. FOR INFORMATION ON THIS PROGRAM CALL UPS AT
1-800-354-7527. (PLEASE REFERENCE THE BOEING PURCHASE ORDER
NUMBER ON ALL PIECES).
FOR STANDARD (SURFACE) SHIPMENTS FROM 151 POUNDS TO 5,000 POUNDS
SHIP VIA CF MOTOTFREIGHT. SHIP COLLECT AND REFERENCE THE BOEING
PURCHASE ORDER NUMBER ON ALL SHIPMENTS.
2. SPECIFIC STREET AND BUILDING ADDRESS MUST BE SHOWN ON ALL
SHIPMENTS.
3. WHEN PURCHASE CONTRACT DIRECTS "SHIP VIA" GBL (GOVERNMENT BILL
OF LADING) OBTAIN SAME FROM YOUR REGIONAL DCMAO (DEFENSE
CONTRACT MANAGEMENT AREA OFFICE).
<PAGE> 47
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 9
-----------------------------------
ACCEPTANCE COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M. S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
SELLER'S PERSONNEL OR MANAGEMENT WILL REQUEST AND SCHEDULE
VACATIONS IN ADVANCE WITH THE COGNIZANT BOEING SUPERVISOR.
ALL VACATIONS MUST BE APPROVED BY BOEING TO AVOID
DISRUPTION
0P40 20. INSTALLATION (SITE) SECURITY
SELLER, ITS EMPLOYEES AND OTHER AGENTS, AND EMPLOYEES AND
OTHER AGENTS OF SUBCONTRACTOR SHALL COMPLY WITH PHYSICAL,
FIRE, OR OTHER PUBLISHED SECURITY REGULATIONS WHILE ON
PREMISES UNDER BUYER'S CONTROL.
0P41 21. COPYRIGHT
ANY COMPUTER SOFTWARE OR OTHER WORK PREPARED BY ANY OF
SELLER'S PERSONNEL IN THE COURSE OF OR AS A RESULT OF ANY
ASSIGNMENT UNDER ANY CONTRACT SHALL:
I. BE A "WORK MADE FOR HIRE" TO WHICH COPYRIGHT VESTS
WITH BUYER OR ITS DESIGNEE, OR
II. IF ANY SUCH WORK IS NOT A "WORK MADE BY HIRE" BY
OPERATION OF LAW, THE COPYRIGHT SUBSISTING IN SUCH
WORK AND ALL EXCLUSIVE RIGHTS UNDER SUCH COPYRIGHT
SHALL BE ASSIGNED AND TRANSFERRED TO BUYER OR ITS
DESIGNEE.
0P42 22. REQUEST FOR RESUMES
BUYER'S HUMAN RESOURCES DEPARTMENTS WILL PERIODICALLY
REQUEST RESUMES FOR SPECIFIC JOB CLASSIFICATIONS. SELLER
WILL ONLY SUBMIT THE REQUESTED NUMBER OF RESUMES FOR THE
IDENTIFIED JOB CLASSIFICATION. SELLER WILL NOT SUBMIT
RESUMES TO ANY OTHER DEPARTMENT OF THE BOEING COMPANY
OTHER THAN THE HUMAN RESOURCES DEPARTMENT. UNSOLICITED
RESUMES WILL NOT BE SUBMITTED BY THE SELLER.
0P43 23. BOEING BUYER TYPING NOTES 0P34 AND 0P35 SUPERSEDES
SECTIONS 5.D AND 6 ON FORM DF4400-918 (REV. 2/97) GENERAL
PROVISIONS (LABOR HOUR CONTRACT).
FNO1 24. FUNDING/SUM ALLOTTED
THE SUM ALLOTTED S20,O0O,O00.00 TO THIS CONTRACT IS EQUAL
TO THE TOTAL PURCHASE CONTRACT VALUE. THE SUPPLIER MUST
NOTIFY THE BUYER WHEN 80% OF THE SUM ALLOTTED VALUE IS
EXPENDED. NO COSTS IN EXCESS OF THE SUM ALLOTTED SHALL BE
INCURRED
**CONTINUED ON NEXT PAGE**
<PAGE> 48
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
DEFENSE & SPACE GROUP JD7563 01 10
-----------------------------------
ACCEPTANCE COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC M. S. BLACKWELL (713) 336-5012
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
WITHOUT A CONTRACT CHANGE TO AUTHORIZE AN INCREASE IN THE
PURCHASE CONTRACT VALUE.
THE SUM ALLOTTED STATED HEREIN IS A NOT-TO-EXCEED VALUE
FOR A TWO (2) YEAR PERIOD FROM OCTOBER 1, 1997 THRU
SEPTEMBER 30, 1999 FOR THE PAYMENT OF HOURS EXPENDED IN
PERFORMANCE OF THE SPECIFIED IN THE JOB DESCRIPTION(S). IT
IS NOT A GUARANTEE OF WORK EQUAL TO THE SUM ALLOTTED
VALUE.
FNO2 25. RATES ARE AS FOLLOWS:
101-125 OVERHEAD G&A
1998 33.20% 0.90%
1999 33.20% 0.80%
2000 33.20% 0.80%
2001 33.20% 0.70%
PROFIT FEE IS 4.00% FOR ALL NUMBERS OF PEOPLE AND YEARS.
SUBCONTRACTING COST IS THE SAME AS G&A BASIC PROPOSAL
SEE ATTACHMENT I FOR ALL OVERHEAD, G&A AND PROFIT RATES
FOR ALL NUMBERS OF PEOPLE AND YEARS.
PCO1 26. REVISE PAYMENT TERMS FROM NET 30 DAYS TO 1/2% NET 10 DAYS
<PAGE> 49
THE BOEING COMPANY Acceptance Reqd |X|
13100 SPACE CENTER BOULEVARD
HOUSTON, TX 77069 Special contract instructions
are attached hereto
ATTN: JAYANT RAMAKRISHNAN
DYNACS ENGINEERING CO INC
35111 US HWY 19 N STE 300
PALM HARBOR FL 34684
SUPPLIER COPY PURCHASE CONTRACT NO. PCC PAGE
JV4148 02 1
- -------------------------------------------------------------------------------
CONFIRM DATE RELEASE DATE
PURCHASE CONTRACT CHANGE 04/15/99
- -------------------------------------------------------------------------------
ADDRESS ALL INQUIRIES TO BUYER: STATE SALES OR USE TAX STATUS
T. HENSON |_| SUBJECT TO TAX
|X| FOR RESALE NOT SUBJECT TO TX TAX
- -------------------------------------------------------------------------------
MAIL STOP AREA CODE/PHONE NO. CERT NO.
HM-T1 (713) 244-4216 1-91-0425694-6
- -------------------------------------------------------------------------------
PAYMENT TERMS SHIPPING TOLERANCE
1/2% 10 DAYS NET 30 OVER % UNDER %
- -------------------------------------------------------------------------------
PRIME CONTRACT NO. RATING ALLOTMENT
NAS 15-10000 DO-C9
- -------------------------------------------------------------------------------
SHIP VIA: F.O.B. POINT FREIGHT ALLOWANCE
NOT APPLICABLE NOT APPLICABLE NONE
- -------------------------------------------------------------------------------
SHIP TO: ORIGINAL PC RELEASE DATE
NONE 01/05/99
- -------------------------------------------------------------------------------
THE FOLLOWING CLAUSES OF FORM D1-4305-1500 (REV 02/96) ARE PART OF THIS CONTRACT
A6 A22 A26 E25 G8 G16 G21 G30 I1 L1 P2 P16 P21 P32 P44
- -------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
THIS PURCHASE CONTRACT, JV4148, IS HEREBY ISSUED FOR ADMINISTRATIVE PURPOSES T0
ALLOW CONVERSION OF PURCHASE CONTRACT JD7563 (DATED 10-15-97) FROM A "CONTRACT
LABOR" TYPE AGREEMENT T0 A "LABOR HOUR/TECHNICAL ASSISTANCE" TYPE AGREEMENT.
1 1.00 LT NPN
ENGINEERING/ADMINISTRATION SUPPORT IN ACCORDANCE 11660631.00
WITH EXHIBIT B.
THE WORK ORDER CHARGE IS 5-2J2P9-1215-JV4148
2 1.00 LT NPN
SUBCONTRACT EFFORT WITH LOCKHEED MARTIN FROM 141483.00
10-01-98 THROUGH 01-31-99.
3 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J8EF-1215-JV4148
4 CANCELED LT NPN
SEE NOTE A184
**CONTINUED ON NEXT PAGE**
<PAGE> 50
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
JV4148 02 2
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
THE WORK ORDER CHARGE IS 5-2J4PO-1215-JV4148
5 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J5EF-1215-JV4148
6 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2JOEG-1215-JV4148
7 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J1EP-1318-JV4148
8 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J4EX-1318-JV4148
9 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J7ET-1318-JV4148
10 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J5EN-1312-JV4148
11 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J7EN-1312-JV4148
12 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J3EW-1318-JV4148
13 CANCELED LT NPN
SEE NOTE A184
**CONTINUED ON NEXT PAGE**
<PAGE> 51
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
JV4148 02 3
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
THE WORK ORDER CHARGE IS 5-2J4EW-1316-JV4148
14 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J3EN-1313-JV4148
15 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J8ET-1318-JV4148
16 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J0EY-1315-JV4148
17 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J7EX-1161-JV4148
18 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J2EX-1318-JV4148
19 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J3P3-1315-JV4148
20 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J1EX-1315-JV4148
21 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J6EW-1316-JV4148
22 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2JOEC-1317-JV4148
**CONTINUED ON NEXT PAGE**
<PAGE> 52
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
JV4148 02 4
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
23 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J3EH-1318-JV4148
24 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J3ET-1318-JV4148
25 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J2ET-1318-JV4148
26 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J1ER-1318-JV4148
27 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J2EB-1318-JV4148
28 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J3EL-1318-JV4148
29 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J6ED-1520-JV4148
30 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J2P8-1101-JV4148
31 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J4EB-1102-JV4148
**CONTINUED ON NEXT PAGE**
<PAGE> 53
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
JV4148 02 5
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
32 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J0EH-1103-JV4148
33 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J8EJ-1216-JV4148
34 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J7EW-1316-JV4148
35 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J0EA-1710-JV4148
36 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J1EB-1720-JV4148
37 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J3EF-1730-JV4148
38 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J4EC-1313-JV4148
39 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J5EW-1316-JV4148
40 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J5ET-1316-JV4148
41 CANCELED LT NPN
**CONTINUED ON NEXT PAGE**
<PAGE> 54
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
JV4148 02 6
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J3PO-1316-JV4148
42 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-24EF-156-JV4248
43 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J5EA-1317-JV4148
44 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J9ES-1217-JV4148
45 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J9FW-1141-JV4148
46 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J7FZ-1142-JV4148
47 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J6FZ-1143-JV4148
48 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J4FZ-1143-JV4148
49 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J3FZ-1143-JV4148
50 CANCELED LT NPN
SEE NOTE A184
**CONTINUED ON NEXT PAGE**
<PAGE> 55
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
JV4148 02 7
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
THE WORK ORDER CHARGE IS 5-2J2FZ-1143-JV4148
51 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J1FZ-1143-JV4148
52 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J0FZ-1143-JV4148
53 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J9FY-1143-JV4148
54 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J8FY-1143-JV4148
55 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J5FZ-1143-JV4148
56 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J8FW-1143-JV4148
57 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J7FY-1145-JV4148
58 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J6FY-1147-JV4148
59 CANCELED LT NPN
SEE NOTE A184
**CONTINUED ON NEXT PAGE**
<PAGE> 56
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
JV4148 02 8
-----------------------------------
SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
THE WORK ORDER CHARGE IS 5-2J2FY-1147-JV4148
60 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J5FY-1141-JV4148
61 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J6FX-1141-JV4148
62 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J4FY-1414-JV4148
63 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J3FY-1415-JV4148
64 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J6EX-1213-JV4148
65 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J4EZ-1213-JV4148
66 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J6EZ-1213-JV4148
67 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J3FW-1151-JV4148
68 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J4FW-1152-JV4148
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SUPPLIER COPY
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- --------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
69 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J2FW-1153-JV4148
70 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J1FW-1154-JV4148
71 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2JOFW-1155-JV4148
72 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J6EZ-1164-JV4148
73 CANCELED LT NPN
SEE NOTE A184
THE WORK ORDER CHARGE IS 5-2J1FS-1165-JV4148
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<TABLE>
<CAPTION>
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- ------------------------------------------------------------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
<S> <C> <C> <C> <C>
EXHIBIT B " SCHEDULE"
ATTACHMENT A "JOHNSON SPACE CENTER PROVISIONS"
ATTACHMENT B "KENNEDY SPACE CENTER PROVISIONS"
ATTACHMENT C "LEWIS RESEARCH CENTER PROVISIONS"
ATTACHMENT D "MARSHALL SPACE FLIGHT CENTER PROVISIONS"
A322 04. CERTIFICATION AND DISCLOSURE REGARDING PAYMENTS TO INFLUENCE
CERTAIN FEDERAL TRANSACTIONS
FAR 52.203-11, "CERTIFICATION AND DISCLOSURE REGARDING
PAYMENTS TO INFLUENCE CERTAIN FEDERAL TRANSACTIONS," IS
INCORPORATED HEREIN BY REFERENCE. SELLER'S SIGNED PROPOSAL
PROVIDED THE REQUIRED CERTIFICATION.
A362 05. "MANNED SPACE FLIGHT ITEM
FOR USE IN MANNED SPACE FLIGHT; MATERIALS,
MANUFACTURING AND WORKMANSHIP OF HIGHEST
QUALITY STANDARDS ARE ESSENTIAL TO ASTRONAUT SAFETY.
IF YOU ARE ABLE TO SUPPLY THE DESIRED ITEM WITH
A HIGHER QUALITY THAN THAT OF THE ITEMS
SPECIFIED OR PROPOSED, YOU ARE REQUESTED TO BRING
THIS FACT TO THE IMMEDIATE ATTENTION OF THE BUYER.
A371 06. "TRAVEL OUTSIDE OF THE UNITED STATES
(A) THE SELLER SHALL NOTIFY THE BUYER AT LEAST 35 DAYS IN
ADVANCE OF THE START OF TRAVEL TO LOCATIONS OUTSIDE THE
UNITED STATES BY SELLER EMPLOYEES THAT IS TO BE CHARGED
TO THIS CONTRACT. IF THAT IS NOT POSSIBLE, THE BUYER SHALL
BE NOTIFIED AS SOON AS THE TRAVEL REQUIREMENT IS
IDENTIFIED.
(B) THE SELLER SHALL SUBMIT A TRAVEL REPORT TO THE BUYER
AT THE CONCLUSION OF THE TRAVEL.
THE TRAVEL REPORT SHALL BE IN THE SELLER'S FORMAT
UNLESS OTHER REQUIRED CONTENTS AND
DISTRIBUTION ARE IDENTIFIED BY THE BUYER."
A393 07. "MISSION CRITICAL SPACE SYSTEMS PERSONNEL
RELIABILITY PROGRAM
NASA FOR SUPPLEMENT 18-52.246-70, 'MISSION CRITICAL SPACE
SYSTEMS PERSONNEL RELIABILITY PROGRAM,' IS INCORPORATED BY
</TABLE>
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<TABLE>
<CAPTION>
SUPPLIER BUYER AREA CODE/PHONE NO.
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- ------------------------------------------------------------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
<S> <C> <C> <C> <C>
REFERENCE."
B158 08. EMERGENCY EVACUATION PROCEDURES
NASA FOR SUPPLEMENT 18-52.237-70, "EMERGENCY EVACUATION
PROCEDURES," IS INCORPORATED BY REFERENCE. "CONTRACTING
OFFICER" MEANS CONTRACTING OFFICER OR BUYER.
F272 09. "TRANSFER OF TECHNICAL DATA AND GOODS - EXPORT CONTROL
REGULATIONS
A. IN PERFORMANCE OF WORK AUTHORIZED UNDER THIS
CONTRACT, THE SELLER AND ITS SUBCONTRACTORS SHALL, AS
NECESSARY, DELIVER, DISCLOSE OR TRANSFER (EXPORT) TO A
FOREIGN ENTITY OR PERSON, TECHNICAL DATA, COMPUTER
SOFTWARE OR EQUIPMENT PURSUANT TO NASA CONTROL AND
GUIDELINES WHICH MAY BE SUBJECT TO THE EXPORT LICENSE
JURISDICTION OF THE COMMERCE DEPARTMENT EXPORT
ADMINISTRATION REGULATIONS (EAR) OF THE STATE DEPARTMENT
INTERNATIONAL TRAFFIC ARMS REGULATIONS (ITAR).
B. IN PROCESSING SUCH EXPORTS, THE SELLER AND ITS
SUBCONTRACTORS SHALL USE RELEVANT REGULATORY EXEMPTIONS
OR OTHER APPROVALS WHICH APPLY (E.G., A GENERAL LICENSE
UNDER THE EAR, OR AN EXEMPTION UNDER THE ITAR),
PURSUANT TO THIS CLAUSE, AND SHALL ABIDE BY ANY
REGULATORY REQUIREMENTS FOR SUCH EXPORTS. SHOULD NO
REGULATORY EXEMPTION OR OTHER APPROVAL EXIST, THE SELLER
SHALL INFORM NASA AND SHALL PROVIDE THE NECESSARY
DOCUMENTATION IN ORDER FOR NASA TO OBTAIN ANY REQUIRED
APPROVAL.
C. ANY EXPORT AFFECTED PURSUANT TO THIS CLAUSE SHALL BE
LIMITED TO ONLY THAT TECHNICAL DATA, COMPUTER SOFTWARE
AND HARDWARE NECESSARY TO DEFINE OR CARRY OUT NASA
RESPONSIBILITIES IN THE INTERNATIONAL SPACE STATION
ALPHA PROGRAM.
D. THE SELLER, SUBJECT TO NASA AND/OR BUYER CONTROL AND
GUIDELINES, IS AUTHORIZED TO PROVIDE THIS DIRECTION IN
ALL SPACE STATION SUBCONTRACTS AT ANY TIER, THE
PERFORMANCE OF WHICH MAY REQUIRE THE DEVELOPMENT,
DELIVERY OR USE OF TECHNICAL DATA, COMPUTER SOFTWARE,
HARDWARE AND FOR WHICH A NEED EXISTS TO EFFECT THE
EXPORT BY THE SUBCONTRACTOR."
F277 10. "IDENTIFICATION AND APPROVAL FOR USE OF RESTRICTED COMPUTER
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<TABLE>
<CAPTION>
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- ------------------------------------------------------------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
<S> <C> <C> <C> <C>
SOFTWARE AND/OR COMMERCIAL COMPUTER SOFTWARE
A. THE SELLER SHALL IDENTIFY, IN WRITING, UPON
DEFINITIZATION, ALL RESTRICTED COMPUTER SOFTWARE AND/OR
COMMERCIAL COMPUTER SOFTWARE, AS DEFINED IN THE 'RIGHTS
IN DATA-GENERAL' AND THE 'COMMERCIAL COMPUTER SOFTWARE
LICENSING' CLAUSES OF THIS CONTRACT, THAT WILL BE
DELIVERED IN PERFORMANCE OF THIS CONTRACT. THE BUYER
SHALL APPROVE OR DISAPPROVE, IN WRITING, USE OF THE
IDENTIFIED SOFTWARE WITHIN 75 DAYS FROM RECEIPT OF
REQUEST.
B. THE SELLER SHALL BE RESPONSIBLE FOR NOTIFYING THE
BUYER ON A CONTINUOUS BASIS OF ADDITIONAL RESTRICTED
COMPUTER SOFTWARE AND/OR COMMERCIAL COMPUTER SOFTWARE
NEEDED.
C. IF THE BUYER DISAPPROVES THE USE OF RESTRICTED
COMPUTER SOFTWARE AND/OR COMMERCIAL COMPUTER SOFTWARE,
WHEN SUCH SOFTWARE IS IDENTIFIED, THE SELLER MAY SUBMIT
A PROPOSAL FOR EQUITABLE ADJUSTMENT TO THE BUYER. SUCH
PROPOSALS SHALL BE HANDLED ACCORDING TO THE PROVISIONS
OF THE 'CHANGES' CLAUSE OF THIS CONTRACT."
F281 11. TECHNICAL INFORMATION RELEASES AND PUBLICATIONS
AS AUTHORIZED BY PARAGRAPH (D)(1) OF THE RIGHTS IN DATA
GENERAL CLAUSE OF THE PURCHASE CONTRACT, THE FOLLOWING
EXCEPTION SHALL APPLY:
DURING THE PERFORMANCE OF THIS PURCHASE CONTRACT, IF
DATA RELATING TO THIS CONTRACT IS PLANNED FOR USE IN
ORAL OR WRITTEN PRESENTATIONS, PROFESSIONAL MEETINGS,
SEMINARS, OR IN ARTICLES TO BE PUBLISHED IN
PROFESSIONAL, SCIENTIFIC, AND TECHNICAL JOURNALS AND
SIMILAR MEDIA, SELLER SHALL ASSURE THAT AN ADVANCE
INFORMATION COPY OF THE PRESENTATION OR ARTICLE IS SENT
TO THE BUYER TO HAVE
THE BENEFIT OF ADVANCE INFORMATION CONCERNING
ACCOMPLISHMENTS OF INTEREST, AND WILL PROVIDE THE BUYER
AN OPPORTUNITY TO MAKE SUGGESTIONS TO THE SELLER
CONCERNING REVISIONS IF IT IS CONSIDERED THAT SUCH
COMMENTS MIGHT BE USEFUL TO THE SELLER TO HELP ASSURE
THE TECHNICAL ACCURACY OF THE INFORMATION TO BE
PRESENTED OR PUBLISHED. THE INFORMATION COPY WILL BE
FORWARDED TO THE BUYER AT LEAST FOUR WEEKS IN ADVANCE OF
THE DATA THE AUTHOR INTENDS TO GIVE THE PRESENTATION OR
SUBMIT THE ARTICLE FOR PUBLICATION. THE ADVANCE
INFORMATION COPY MAY BE SUBMITTED IN THE FORMAT OR
MEDIUM WHICH WILL BE SUBMITTED IN THE FORMAT OR MEDIUM
WHICH WILL BE UTILIZED IN ITS ULTIMATE RELEASE.
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<TABLE>
<CAPTION>
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- ------------------------------------------------------------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
<S> <C> <C> <C> <C>
G199 12. PAYMENT FOR OVERTIME PREMIUMS
A) THE USE OF OVERTIME IS AUTHORIZED UNDER THIS CONTRACT
IF THE OVERTIME PREMIUM COST DOES NOT EXCEED THE AMOUNT
SET FORTH IN PARAGRAPH (C) BELOW OR THE OVERTIME IS PAID
FOR WORK -
1) NECESSARY TO COPE WITH EMERGENCIES SUCH AS
THOSE RESULTING FROM ACCIDENTS, NATURAL DISASTERS,
BREAKDOWNS OF PRODUCTION EQUIPMENT, OR OCCASIONAL
PRODUCTION BOTTLENECKS OF A SPORADIC NATURE;
2) BY INDIRECT-LABOR EMPLOYEES SUCH AS THOSE
PERFORMING DUTIES IN CONNECTIONS WITH ADMINISTRATION,
PROTECTION, TRANSPORTATION, MAINTENANCE STANDBY PLANT
PROTECTION, OPERATION OR UTILITIES, OR ACCOUNTING;
3) TO PERFORM TESTS, INDUSTRIAL PROCESSES,
LABORATORY PROCEDURES, LOADING OR UNLOADING OF
TRANSPORTATION CONVEYANCES, AND OPERATIONS IN FLIGHT OR
AFLOAT THAT ARE CONTINUOUS IN NATURE AND CANNOT
REASONABLY BE INTERRUPTED OR COMPLETED OTHERWISE; OR
4) THAT WILL RESULT IN LOWER OVERALL COSTS TO THE
BUYER.
B) ANY REQUEST FOR ESTIMATED OVERTIME PREMIUMS THAT
EXCEEDS THE AMOUNT SPECIFIED ABOVE SHALL INCLUDE ALL
ESTIMATED OVERTIME FOR CONTRACT COMPLETION AND SHALL:
1) IDENTIFY THE WORK UNIT; E.G., DEPARTMENT OR
SECTION IN WHICH THE REQUESTED OVERTIME WILL BE USED,
TOGETHER WITH PRESENT WORKLOAD, STAFFING AND OTHER DATA
OF THE AFFECTED UNIT SUFFICIENT TO PERMIT THE BUYER TO
EVALUATE THE NECESSITY FOR THE OVERTIME;
2) DEMONSTRATE THE EFFECT THAT DENIAL OF THE
REQUEST WILL HAVE ON THE CONTRACT DELIVERY OR
PERFORMANCE SCHEDULE;
AND
3) PROVIDE REASONS WHY THE REQUIRED WORK CANNOT BE
PERFORMED BY USING MULTISHIFT OPERATIONS OR BY EMPLOYING
ADDITIONAL PERSONNEL.
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<TABLE>
<CAPTION>
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- ------------------------------------------------------------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
<S> <C> <C> <C> <C>
C) THE OVERTIME PREMIUM CEILING CONTEMPLATED BY
PARAGRAPH A IS 5%.
G243 13. INVOICE PAYMENT REQUIREMENTS
A. PAYMENTS. PAYMENTS ARE MADE FROM "ORIGINAL" INVOICES
ONLY. FAX COPIES, STATEMENTS OR INVOICE COPIES WILL NOT
BE ACCEPTED. "DUPLICATE ORIGINAL" INVOICES MUST NOT BE
SENT WITHOUT PRIOR AUTHORIZATION FROM EITHER THE BUYER
OR ACCOUNTS PAYABLE. "DUPLICATE ORIGINAL" INVOICES MUST
BE SIGNED AND DATED WITH THE FULL SIGNATURE OF SELLER'S
APPROPRIATE MANAGER. INITIALS WILL NOT BE ACCEPTED.
THIRD PARTY BILLING IS NOW ALLOWED.
B. TERMS PAYMENT TERMS BEGIN UPON RECEIPT OF AN
ACCEPTABLE INVOICE BY BUYER'S ACCOUNTS PAYABLE
ORGANIZATION. PAYMENTS ARE NOT SCHEDULED BASED UPON THE
DATE OF YOUR INVOICE. AGREED UPON TERMS MUST BE
CORRECTLY INDICATED ON YOUR INVOICE AND SHOULD AGREE
WITH THE PURCHASE CONTRACT. EXAMPLE: 2% 10 NET 30.
C. MAILING INFORMATION
INVOICES ARE TO BE MAILED TO:
BOEING INFORMATION, SPACE & DEFENSE SYSTEMS
ACCOUNTS PAYABLE, P.O. BOX 34113
SEATTLE, WA 98124-1113
EXPRESS OVERNIGHT MAIL SHOULD BE SENT TO:
BOEING INFORMATION, SPACE & DEFENSE SYSTEMS
ACCOUNTS PAYABLE
18-01 BUILDING, 2ND FLOOR, MAIL STOP 80-FW
20403 68TH AVENUE SOUTH
KENT, WA 98032
D. PREPAID FREIGHT CHARGES. WHEN PREPAID FREIGHT CHARGES
ARE AUTHORIZED BY BUYER, INCLUDE A COPY OF THE PREPAID
FREIGHT BILL WITH THE INVOICE FOR CHARGES OVER $100.00.
FREIGHT CHARGES WILL BE DEDUCTED FROM THE PAYMENT IF
THIS DOCUMENTATION IS NOT INCLUDED.
E. INVOICE INFORMATION. ALL INVOICES MUST CONTAIN THE
FOLLOWING INFORMATION:
1. BUYER'S PURCHASE CONTRACT NUMBER (EXAMPLE:
AA1111 OR
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<TABLE>
<CAPTION>
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- ------------------------------------------------------------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
<S> <C> <C> <C> <C>
AAA111) NOTE: ONLY ONE PURCHASE CONTRACT NUMBER PER
INVOICE.
2. PAYMENT TERMS (EXAMPLE: 2% 10 NET 30)
3. INVOICE NUMBER
4. INVOICE DATA
5. BOEING PURCHASE CONTRACT LINE ITEM NUMBER (EXAMPLE: 05)
6. QUANTITY INVOICED (NOTE: QUANTITY INVOICED MUST
EQUAL QUANTITY SHIPPED AND CANNOT EXCEED QUANTITY ORDERED)
7. BOEING PART NUMBER
8. UNIT PRICE
9. TOTAL PRICE
10. TOTAL TAX
11. FREIGHT CHARGES
THE PURCHASE CONTRACT IS THE SOLE BASIS FOR YOUR
PAYMENT. INCORRECT INVOICES WILL BE RETURNED UNPAID.
ACCOUNTS PAYABLE CANNOT AUTHORIZE OR NEGOTIATE ANY
CHANGES TO THE PURCHASE CONTRACT. CONTACT THE BUYER
DIRECTLY TO RESOLVE INVOICE DISCREPANCIES.
F. PAYMENT INQUIRIES. BOEING DEFENSE & SPACE GROUP
CHECKS ARE GENERATED ONCE A WEEK. CHECKS ARE PREPARED
AND MAILED EACH FRIDAY. INQUIRIES ON PAST DUE INVOICES
(AGED OVER 45 DAYS) OR PAYMENT PROBLEMS MAY BE FAXED
DIRECTLY TO ACCOUNTS PAYABLE, FAX NUMBER (253) 773-7999.
A COPY OF THE INVOICE IN QUESTION SHOULD BE ANNOTATED
WITH THE SPECIFIC PROBLEM. FOR EXAMPLE:
1. NOT PAID
2. UNDER/OVER PAID (SHOW THE AMOUNT UNDER OR OVER PAID)
3. SALES TAX OR FREIGHT NOT PAID
H119 14. "IDENTIFICATION OF EMPLOYEES
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<TABLE>
<CAPTION>
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- ------------------------------------------------------------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
<S> <C> <C> <C> <C>
AT ALL TIMES WHILE ON GOVERNMENT PROPERTY, THE SELLER,
SUBCONTRACTORS, THEIR EMPLOYEES AND AGENTS SHALL WEAR
BADGES WHICH WILL BE ISSUED BY THE NASA CONTRACT AND
PASS OFFICE, LOCATED IN BUILDING NO. 110. BADGES WILL BE
ISSUED ONLY BETWEEN THE HOURS OF 7:00 A.M. AND 4:00
P.M., MONDAY THROUGH FRIDAY. EACH INDIVIDUAL WHO WEARS A
BADGE WILL BE REQUIRED TO SIGN PERSONALLY FOR THE BADGE.
THE SELLER WILL BE HELD ACCOUNTABLE FOR THESE BADGES,
AND IMMEDIATELY AFTER COMPLETION OF THE WORK THEY SHALL
BE RETURNED TO THE NASA CONTRACT BADGE AND PASS OFFICE.
FAILURE TO TURN IN BADGES UPON COMPLETION OF THE WORK
MAY RESULT IN FINAL PAYMENT BEING DELAYED."
I133 15. SALES/USE TAX REGISTRATION NUMBER
CLAUSE I.1 OF FORM d1 4305 1500, INCORPORATED BY
REFERENCE, IS REVISED BY ADDING/REVISING THE
STATE/REGISTRATION NUMBER AS FOLLOWS: TEXAS 1-91425694-6
L108 16. CROSS-WAIVER OF LIABILITY FOR SPACE STATION ACTIVITIES
NASA FOR SUPPLEMENT 18-52.228-76, " CROSS-WAIVER OF LIABILITY
FOR SPACE STATION ACTIVITIES," IS INCORPORATED BY REFERENCE.
"CONTRACTOR" MEANS SELLER
P118 17. FOR THE CONSIDERATIONS CONTAINED IN THIS
CONTRACT, BUYER SHALL HAVE THE RIGHT AND OPTION TO
PURCHASE, AND SELLER HEREBY AGREES TO SELL TO BUYER UPON
RECEIPT OF BUYER'S NOTICE EXERCISING THE OPTION, THE
FOLLOWING ITEMS(S), WITHIN THE QUANTITIES AND TO THE
SCHEDULE(S) SET FORTH BELOW, AND UPON THE TERMS AND
CONDITIONS AND OTHER PROVISIONS OF THIS CONTRACT. BUYER
MAY EXERCISE ANY OR ALL OF THE FOREGOING OPTION(S) BY
ISSUANCE OF SAID NOTICE(S) NOT LATER THAN THE DATE(S)
SHOWN IN THE COLUMN ENTITLED "OPTIONS EXERCISE DATE(S)",
BELOW. SELLER'S FAILURE TO MEET CONTRACT PERFORMANCE
SCHEDULES OR MILESTONES LEADING UP TO BUYER'S DECISION
TO EXERCISE THE FOLLOWING OPTION(S) SHALL RESULT IN A
DAY-FOR-DAY SLIDE IN THE OPTION EXERCISE DATE(S). EACH
PROPOSAL SUBMITTED BY SELLER PURSUANT TO THE "CHANGES"
CLAUSE OF THIS CONTRACT SHALL INCLUDE SELLER'S PROPOSED
ADJUSTMENT, IF ANY, TO THE UNIT PRICE(S) SET FORTH
BELOW, DIRECTLY CAUSED BY THE CHANGES(S) TO WHICH SUCH
PROPOSAL RELATES. SELLER SHALL NOT BE ENTITLED TO ANY
ADJUSTMENT OF THESE UNIT PRICE(S) BEYOND THAT NEGOTIATED
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<TABLE>
<CAPTION>
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- ------------------------------------------------------------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
<S> <C> <C> <C> <C>
BY BUYER AND SELLER AS A RESULT OF SUCH PROPOSAL.
QUANTITY ITEM UNIT PRICE SCHEDULE OPTION EXERCISE DATE(S)
1 LT. ? $10000000.00 N/A FY'00 10/01/99
1 LT. ? $10000000.00 N/A FY'01 10/01/00
P267 18. YEAR 2000 COMPLIANCE
IF THIS CONTRACT IS FOR THE PROCUREMENT OF TECHNOLOGY
THAT WILL BE REQUIRED TO PERFORM DATE/TIME PROCESSING,
BY ACKNOWLEDGING THIS CONTRACT SELLER VERIFIES THAT SUCH
SUPPLIES ARE YEAR 2000 COMPLIANT. YEAR 2000 COMPLIANT
MEANS INFORMATION TECHNOLOGY THAT ACCURATELY PROCESSES
DATE/TIME DATA (INCLUDING, BUT NOT LIMITED TO,
CALCULATING, COMPARING, AND SEQUENCING) FROM, INTO, AND
BETWEEN THE TWENTIETH AND TWENTY-FIRST CENTURIES, AND
THE YEARS 1999 AND 2000 AND LEAP YEAR CALCULATIONS.
FURTHERMORE, YEAR 2000 COMPLIANT INFORMATION TECHNOLOGY,
WHEN USED IN COMBINATION WITH OTHER INFORMATION
TECHNOLOGY, SHALL ACCURATELY PROCESS DATE/TIME DATA IF
THE OTHER INFORMATION TECHNOLOGY PROPERLY EXCHANGES
DATE/TIME DATA WITH IT.
R171 19. BUSINESS SIZE CERTIFICATION
IN ACCORDANCE WITH SELLER'S CURRENT BUSINESS SIZE
CERTIFICATION (FORM) DO-6000-4195), OR OTHER INFORMATION
PROVIDED TO THE BUYER, SELLER'S BUSINESS SIZE HAS BEEN
ESTABLISHED AS SET FORTH BELOW. IF THIS BUSINESS SIZE IS
NOT CORRECT, SELLER SHALL IMMEDIATELY NOTIFY THE BUYER'S
SUPPLIER MANAGEMENT.
SELLER'S CURRENT BUSINESS SIZE IS: SMALL MINORITY OWNED
BUSINESS.
SMALL MINORITY OWNED BUSINESS.
OP37 20. INDEPENDENT CONTRACTOR AND LABOR REQUIREMENTS
A. SELLER IS PROVIDING SERVICES AS AN INDEPENDENT
CONTRACTOR. PERSONNEL ASSIGNED BY SELLER ARE NOT
EMPLOYEES OF BUYER, BUT ARE SELLER'S EMPLOYEES AND
SUBJECT TO THE RULES, REGULATIONS AND MANAGEMENT OF
SELLER. SELLER'S EMPLOYEES SHALL BE PAID EXCLUSIVELY BY
SELLER AND SELLER SHALL BE RESPONSIBLE FOR COMPLIANCE
WITH ALL REQUIREMENTS RELATING TO ITS EMPLOYEES UNDER
LOCAL, STATE, AND FEDERAL LAWS AND REGULATIONS,
INCLUDING BUT NOT LIMITED TO LAWS
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<TABLE>
<CAPTION>
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- ------------------------------------------------------------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
<S> <C> <C> <C> <C>
AND REGULATIONS GOVERNING MINIMUM WAGE, SOCIAL SECURITY,
IMMIGRATION AND NATURALIZATION, UNEMPLOYMENT INSURANCE, INCOME
TAX, AND WORKMENS COMPENSATION. ALL TAX OBLIGATIONS ASSOCIATED
WITH THIS PURCHASE CONTRACT ARE THE SOLE RESPONSIBILITY
OF SELLER. IN THE EVENT BUYER IS ASSESSED OR NOTIFIED OF
ANY SUCH TAXES, BUYER SHALL NOTIFY SELLER AND SELLER
SHALL PROMPTLY PAY THE AMOUNT OF SUCH ASSESSMENTS TO THE
PROPER AUTHORITY. AT THE REQUEST OF BUYER, SELLER SHALL
GIVE REASONABLE EVIDENCE OF COMPLIANCE WITH ALL SUCH
LEGAL REQUIREMENTS AND OBLIGATIONS.
B. ALL WORK SHALL BE PERFORMED AT BUYER'S FACILITIES
UNLESS OTHERWISE REQUESTED AND AUTHORIZED BY BUYER.
C. SELLER SHALL NOT RECRUIT OR INDUCE BUYER'S PERMANENT
EMPLOYEE TO BECOME EMPLOYEES OF SELLER DURING THE TERM
OF THIS ORDER OR FOR A PERIOD OF SIX (6) MONTHS
THEREAFTER.
D. SELLER SHALL INSTRUCT ITS EMPLOYEES NOT TO DIVULGE OR
DISCUSS WITH BUYER'S EMPLOYEES ANY TERMS OF THIS ORDER,
INCLUDING THE RATES OF PAY. ANY VIOLATION OF THIS
PROVISION WILL ENTITLE BUYER TO REQUEST SUCH EMPLOYEE BE
WITHDRAWN FROM PERFORMANCE UNDER THIS ORDER.
E. NEITHER SELLER NOR ITS AGENTS OR REPRESENTATIVES
SHALL OFFER OR EXTEND GRATUITIES, SUCH AS GIFTS OR
ENTERTAINMENT TO ANY OF BUYER'S EMPLOYEES, REGARDLESS OF
THE PURPOSE OF INTENT.
F. SELLER SHALL NOT SUBCONTRACT FOR ANY OF THE SERVICES
TO BE PROVIDED UNDER THIS CONTRACT WITHOUT THE PRIOR
WRITTEN CONSENT OF BUYER.
OP39 21. VACATIONS
SELLER'S PERSONNEL OR MANAGEMENT WILL REQUEST AND
SCHEDULE VACATIONS IN ADVANCE WITH THE COGNIZANT
BOEING SUPERVISOR. ALL VACATIONS MUST BE
APPROVED BY BOEING TO AVOID DISRUPTION
OP40 22. INSTALLATION (SITE) SECURITY
SELLER, ITS EMPLOYEES AND OTHER AGENTS, AND EMPLOYEES
AND OTHER AGENTS OF SUBCONTRACTOR SHALL COMPLY WITH
PHYSICAL, FIRE, OR OTHER PUBLISHED SECURITY REGULATIONS
WHILE ON PREMISES UNDER BUYER'S CONTROL.
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<TABLE>
<CAPTION>
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- ------------------------------------------------------------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
<S> <C> <C> <C> <C>
OP41 23. COPYRIGHT
ANY COMPUTER SOFTWARE OR OTHER WORK PERFORMED BY ANY OF
SELLER'S PERSONNEL IN THE COURSE OF OR AS A RESULT OF
ANY ASSIGNMENT UNDER ANY CONTRACT SHALL:
I. BE A "WORK MADE FOR HIRE" TO WHICH COPYRIGHT VESTS
WITH BUYER OR ITS DESIGNEE, OR
II. IF ANY SUCH WORK IS NOT A "WORK MADE BY HIRE" BY
OPERATION OF LAW, THE COPYRIGHT SUBSISTING IN SUCH WORK
AND ALL EXCLUSIVE RIGHTS UNDER SUCH COPYRIGHT SHALL BE
ASSIGNED AND TRANSFERRED TO BUYER OR ITS DESIGNEE.
OQ19 24. PLEASE RETURN ACCEPTANCE COPY OF THIS
PURCHASE CONTRACT AND ALL CORRESPONDENCE TO:
THE BOEING COMPANY
P.O. BOX 58747
HOUSTON, TX 77058-8747
I.T. HENSON JHOU-2140
FN01 25. RESERVED.
FN02 26. SELLER SHALL IMMEDIATELY ISSUE A CREDIT
MEMORANDUM(S) FOR ALL MONIES RECEIVED AS PAYMENT(S) FOR
THE PERIOD OF 10-01-98 TO THE PRESENT AGAINST PURCHASE
CONTRACT JD7563 AND RE-INVOICE THOSE COSTS AGAINST THIS
PURCHASE CONTRACT. ALL SUCH INVOICES SHALL ALSO INCLUDE
BUYER APPROVED TRAVEL COSTS INCURRED BY SELLER IN
SUPPORT OF EXHIBIT B OF THIS CONTRACT DURING THE SAME
PERIOD OF 10-01-98 THROUGH 09-30-99.
FN03 27. EMPLOYEE ASSIGNMENT
THE SELLER SHALL ASSIGN EMPLOYEES TO THIS CONTRACT WHO
POSSESS THE QUALIFICATIONS TO PERFORM THE REQUIRED
SERVICES. THE BUYER HAS THE RIGHT TO ACCEPT OR REJECT
ASSIGNED SELLER PERSONNEL. IF REQUESTED, THE SELLER
SHALL NOTIFY BUYER REGARDING THE NEED TO OBTAIN
REPLACEMENT EMPLOYEE(S).
THE BUYER ALSO RESERVES THE RIGHT TO REDUCE THE QUANTITY
OF PERSONNEL ASSIGNED, INCLUDING BUT NOT LIMITED TO,
</TABLE>
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<TABLE>
<CAPTION>
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- ------------------------------------------------------------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
<S> <C> <C> <C> <C>
NON-REPLACEMENT OF PERSONNEL WHO RESIGN OR ARE EXCUSED
FOR CAUSE.
FN04 28. COMPENSATION
AS FULL COMPENSATION FOR THE PERFORMANCE OF THIS ORDER,
UNLESS OTHERWISE PROVIDED IN THE ORDER, BUYER SHALL PAY
SELLER AT THE RATES SET FORTH IN THE ORDER FOR ALL
SERVICES PROVIDED HEREUNDER BY SELLER'S EMPLOYEES PLUS,
FOR ANY TRAVEL REQUIRED AS APPROVED AND DETERMINED
NECESSARY BY BUYER. SAID RATES COVER ALL WAGES AND
SALARIES, OVERHEAD, G&A, AND PROFIT AND OTHER COSTS AND
EXPENSES OF SELLER INCIDENT TO THIS ORDER, EXCEPT SUCH
COSTS AND EXPENSES AS MAY BE COVERED BY TRAVEL, OR OTHER
COSTS OR ALLOWANCES SPECIFICALLY PROVIDED FOR IN THE
ORDER.
BUYER'S STANDARD WORK WEEK BEGINS ON FRIDAY AND ENDS ON
THE FOLLOWING THURSDAY.
OVERTIME OR OTHER PREMIUM RATES, IF ANY, WILL NOT BE
PAID UNLESS THE PERFORMANCE OF THE OVERTIME OR OTHER
PREMIUM-PAY WORK HAS THE PRIOR APPROVAL OF BUYER.
A. OVERTIME
OVERTIME SHALL BE PAID AT THE OVERTIME LABOR RATES FOR
QUALIFYING SELLER'S PERSONNEL. OVERTIME COMPENSATION
SHALL BE AT THE RATES AGREED TO BETWEEN BUYER AND
SELLER. OVERTIME SHALL BE DETERMINED AS FOLLOWS:
(1) BUYER CONSIDERS OVERTIME AS ANY TIME EXPENDED
BEYOND A NORMAL 40 HOUR WORK WEEK (INCLUDING
WEEKENDS AS REGULAR TIME). OVERTIME SHOULD BE
CHARGED ONLY AFTER 40 REGULAR HOURS.
(2) BUYER CONSIDERS OVERTIME DURING A BOEING HOLIDAY
WORK WEEK TO BE ANY TIME EXPENDED BEYOND 32-HOUR
WORK WEEK (INCLUDING WEEKENDS AND HOLIDAYS AS
REGULAR TIME). OVERTIME SHOULD BE CHARGED ONLY
AFTER 32 REGULAR HOURS.
(B) HOLIDAYS
SELLER'S EMPLOYEES SHALL ADHERE TO BUYER'S ESTABLISHED
HOLIDAY SCHEDULE FOR DURATION OF THE CONTRACT:
FY'1999
</TABLE>
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<PAGE> 69
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JV4148 02 21
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<TABLE>
<CAPTION>
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- ------------------------------------------------------------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
<S> <C> <C> <C> <C>
26 AND 27 NOVEMBER 1998
24 DECEMBER 1998 THROUGH 01 JANUARY 1999
25 MAY 1999
05 JULY 1999
06 SEPTEMBER 1999
BOEING DOES NOT PAY FOR HOLIDAYS IF NOT
WORKED.
FN05 29. IF SUM ALLOTTED $11,802,114.00 TO THIS
CONTRACT IS EQUAL TO THE TOTAL PURCHASE CONTRACT VALUE.
THE SELLER MUST NOTIFY THE BUYER WHEN 80% OF THE SUM
ALLOTTED VALUE IS EXPENDED. NO COSTS IN EXCESS OF THE
SUM ALLOTTED SHALL BE INCURRED WITHOUT A CONTRACT CHANGE
TO AUTHORIZE AN INCREASE IN THE PURCHASE CONTRACT VALUE.
THE SUM ALLOTTED STATED HEREIN IS A NOT-TO-EXCEED VALUE
FOR A ONE (1) YEAR PERIOD FROM 01 OCTOBER 1998 THROUGH
30 SEPTEMBER 1999 FOR THE PAYMENT OF HOURS EXPENDED IN
THE PERFORMANCE OF THE WORK SPECIFIED IN EXHIBIT B. IT
IS NOT A GUARANTEE OF WORK EQUAL TO THE SUM ALLOTTED
VALUE.
FN06 30. SECURITY
SELLER'S EMPLOYEES SHALL FOLLOW THE BUYER'S SECURITY
POLICIES AND PROCEDURES WHILE ON BUYER'S FACILITIES.
FN07 31. BADGING
SELLER'S EMPLOYEE'S, SUBCONTRACTORS, AND AGENTS SHALL BE
REQUIRED TO WEAR BADGES ISSUED BY THE BUYER'S SECURITY
OFFICE LOCATED AT 2100 SPACE PARK DRIVE, HOUSTON, TEXAS
WHILE IN BUYER'S FACILITIES OR OTHER AREAS AS ASSIGNED
BY BUYER. ALL SUCH BADGES SHALL BE ISSUED BETWEEN THE
HOURS OF 8:00 AM AND 4:30 PM, MONDAY THROUGH FRIDAY,
EXCLUDING BUYER HOLIDAYS. INDIVIDUAL SELLER EMPLOYEES
ISSUED A BADGE SHALL BE REQUIRED TO SIGN FOR SUCH BADGE
AND BE RESPONSIBLE FOR REPORTING ANY LOSS OR DAMAGE
THERETO. THE SELLER WILL BE HELD ACCOUNTABLE FOR THESE
BADGES, AND IMMEDIATELY AFTER COMPLETION OF ALL EFFORT
ASSOCIATED WITH THIS PURCHASE CONTRACT AND ALL POTENTIAL
FOLLOW-ON CONTRACTS, THE BADGES WILL BE RETURNED TO THE
BUYER'S SECURITY OFFICE. FAILURE TO RETURN ANY SUCH
BADGES UPON COMPLETION OF ALL REQUIRED SERVICE(S) MAY
RESULT IN FINAL PAYMENT BEING DELAYED.
FN08 32. UTILIZATION OF FOREIGN NATIONALS
</TABLE>
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<PAGE> 70
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JV4148 02 22
------------------------------------
<TABLE>
<CAPTION>
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- ------------------------------------------------------------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
<S> <C> <C> <C> <C>
SELLER'S EMPLOYEES, SUBCONTRACTORS, AND AGENTS WHO ARE
NOT UNITED STATES CITIZENS AND WHO ARE NOT A LAWFUL
PERMANENT RESIDENT OF THE UNITED STATES (SUCH PERMANENT
RESIDENT IS OFTEN REFERRED TO AS A "GREEN CARD" HOLDER),
MAY NOT BE ADMITTED TO BUYER'S FACILITIES OR OTHER
LOCATIONS ASSIGNED BY BUYER FOR THE PURCHASE OF
PERFORMING WORK AGAINST THIS PURCHASE CONTRACT WITHOUT
SPECIAL ARRANGEMENTS. IF FOREIGN NATIONALS ARE PROJECTED
TO BE USED IN PERFORMANCE OF WORK AT BUYER'S
FACILITIES/ASSIGNED LOCATIONS, ADVANCE NOTICE OF AT
LEAST TWO (02) WEEKS MUST BE GIVEN TO BUYER PRIOR TO THE
SCHEDULED NEED FOR ACCESS TO ALL SUCH
FACILITIES/LOCATIONS. BUYER SHALL ENSURE THE APPLICABLE
EXPORT CONTROL AND BADGING REQUIREMENTS ARE REVIEWED
PRIOR TO AUTHORIZING ACCESS TO BUYER" FACILITIES/OTHER
ASSIGNED LOCATIONS.
THE SELLER MUST PROVIDE THE FOLLOWING INFORMATION FOR
EACH FOREIGN NATIONAL:
A) EXACT LOCATION OF WORK SITE
B) DURATION OF NEED FOR ACCESS
C) COUNTRY OF ORIGIN
D) COMPLETE NAME AND ADDRESS OF EMPLOYEE
E) SELLER'S NAME AND ADDRESS
F) PURCHASE CONTRACT NUMBER
G) PROOF OF LEGAK ENTRY INTO THE UNITED STATES
H) OTHER INFORMATION THAT MAY BE REQUIRED BY BUYER'S
SECURITY OFFICE.
THE BUYER WILL MAKE THE ARRANGEMENTS NECESSARY TO CLEAR
SELLER'S EMPLOYEES FOR ACCESS INTO BUYER'S FACILITIES OR
OTHER ASSIGNED LOCATIONS AND WILL NOTIFY SELLER IF
ACCESS IS DENIED OR DELAYED.
THE SELLER AGREES THAT THEY WILL NOT EMPLOY ANY
INDIVIDUALS WHO ARE NOT LEGALLY IN THE UNITED STATES FOR
THE PERFORMANCE OF WORK UNDER THIS PURCHASE CONTRACT.
OP01 33. 37
PC01 34. EFFECTIVE 10-01-98 THE FOLLOWING
CHANGES/REVISIONS ARE INCORPORATED WITH THIS
PURCHASE CONTRACT CHANGE PCC01:
DELETE THE WORK ORDER CHARGE NUMBER FOR LINE ITEM 17
"5-2JOEY-1315-JV4148" AND SUBSTITUTE
"5-2J7EX-1161-JV4148" IN LIEU THEREOF.
</TABLE>
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<PAGE> 71
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<TABLE>
<CAPTION>
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- ------------------------------------------------------------------------------------------------------------------------------------
ITEM QUANTITY U/M PART NUMBER AND DESCRIPTION UNIT PRICE
<S> <C> <C> <C> <C>
INCORPORATE LINE ITEMS 72 AND 73.
AMEND PURCHASE ORDER CLAUSE A203 BY INCORPORATING THE
EXHIBITS NOTED IN FN01 AND INCORPORATING EXHIBIT D" SPACE
STATION PROGRAM DIRECTIVE: CONTRACT LABOR TRAVEL."
CHANGE FN01 TO READ "RESERVED."
DELETE EXHIBIT B DATED 10-01-98 IN ITS ENTIRETY AND
SUBSTITUTE EXHIBIT B DATED 02-13-99 IN LIEU THEREOF.
PC02 35. EFFECTIVE 10-01-98 THE FOLLOWING CHANGES ARE
INCORPORATED TO THIS PURCHASE CONTRACT:
THE TOTAL NOT-TO-EXCEED VALUE OF LINE ITEM 01 IS HEREBY
REDUCED BY $141,483.00 TO ADD TO LINE ITEM 02.
LINE ITEM 02 IS HEREBY AMENDED TO INCORPORATE SELLER'S
SUBCONTRACTING COSTS WITH LOCKHEED MARTIN AEROSPACE
CORP. FOR THEIR SUPPORT FROM 10-01-98 THROUGH 01-31-99.
TOTAL NOT-TO-EXCEED AMOUNT FOR THIS EFFORT IS
$141,483.00.
DELETE EXHIBIT B DATED 02-13-99 AND EXHIBIT C DATED
10-01-98 IN THEIR ENTIRETY AND SUBSTITUTE EXHIBIT B AND
B-1 DATED 04-13-99 IN LIEU THEREOF. THIS WILL
INCORPORATE NEW HOURLY LABOR RATES FOR ADDITIONAL
OVERHEAD EFFORTS AND EXHIBIT B-2 FOR THE WORK ORDER
CHARGE NUMBERS AUTHORIZED BY THIS PURCHASE ORDER
CONTRACT.
SELLER IS NOT TO CONSIDER THE WORK ORDER CHARGE NUMBERS
OF LINE ITEMS 3 AND ON AS NOTIFICATION OF WORK ORDER
NUMBERS.
DELETE EXHIBIT D "SPACE STATION DIRECTIVE: CONTRACT
LABOR TRAVEL" IN ITS ENTIRETY.
</TABLE>
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<PAGE> 72
THE BOEING COMPANY PURCHASE CONTRACT NO. PCC PAGE
JV4148 02 24
-------------------------------------
- --------------------------------------------------------------------------------
SUPPLIER BUYER AREA CODE/PHONE NO.
DYNACS ENGINEERING CO INC T. HENSON (713) 244-4216
- --------------------------------------------------------------------------------
GENERAL INSTRUCTIONS
A. THE PURCHASE CONTRACT NUMBER SHOWN ON THE FACE OF THE ORDER AND THE
APPLICABLE ITEM NUMBER(S) MUST APPEAR ON ALL INVOICES AND CORRESPONDENCE
PERTAINING TO THIS CONTRACT.
B. REFER OR ADDRESS ALL INQUIRIES REGARDING THIS CONTRACT (EXCEPT
INVOICES), TO THE BUYER AT THE BOEING MAIL STOP SPECIFIED ON THIS
CONTRACT. INVOICES ARE TO BE MAILED TO THE ATTENTION OF ACCOUNTS PAYABLE
THE BOEING COMPANY, P.O. BOX 34113, SEATTLE, WA 98124-1113).
C. YOUR BILLING UNIT OF MEASURE (U/M) MUST BE THE SAME AS THE U/M ORDERED,
UNLESS OTHERWISE NOTED. UNIT PRICES SHOWN IN THIS CONTRACT ARE NET AND
APPLICABLE TRADE DISCOUNTS HAVE BEEN CONSIDERED. FEDERAL EXCISE TAX, IF
ANY, MUST BE SHOWN AS A SEPARATE ITEM ON YOUR INVOICES. TWO COPIES OF
ALL INVOICES MUST BE SUBMITTED, ONE COPY MUST BE MARKED ORIGINAL.
D. ALL ITEMS SHALL BE TO THE LATEST DRAWINGS AND SPECIFICATIONS UNLESS
EXCEPTIONS ARE SPECIFIED IN THIS CONTRACT.
SHIPPING INSTRUCTIONS
A. ALL SHIPMENTS WHICH ARE F.O.B. SHIPPING POINT ARE TO BE SHIPPED COLLECT
WHEN CONSIGNED TO A BOEING ADDRESS. F.O.B. DESTINATION SHIPMENTS TO BE
SHIPPED PREPAID VIA CARRIER OF YOUR CHOICE. PLEASE INDICATE DESTINATION
ZIP CODE, SPECIFIC STREET AND BUILDING ADDRESS ON ALL SHIPMENTS.
B. ALL SHIPMENTS FROM HUNTSVILLE COMMERCIAL ZONE THAT ARE F.O.B. SHIPPING
POINT SHOULD BE SHIPPED VIA UNITED PARCEL SERVICE (UPS) OR BOEING
LICENSED TRANSPORTATION.
C. BOEING PURCHASE CONTRACT NUMBER(S) AND ITEM NUMBER(S) MUST APPEAR ON ALL
PACKING SHEETS AND FREIGHT BILLS, INCLUDING THIRD PARTY FREIGHT BILLS.
D. CONSOLIDATE ALL COLLECT SHIPMENTS TO BE FORWARDED VIA THE SAME
TRANSPORTATION MODE ON ANY ONE DAY TO ANY ONE CONSIGNMENT ADDRESS.
E. DO NOT COMBINE SHIPMENTS FOR VARIOUS BOEING COMPANIES AND DIVISIONS
UNLESS SPECIFICALLY INSTRUCTED.
F. DO NOT INSURE OR DECLARE VALUE ON ANY SHIPMENT EXCEPT TO OBTAIN LOWEST
RATES WHEN BASED ON A RELEASED VALUE.
G. SHIPMENTS FROM OUTSIDE USA MUST BE ACCOMPANIED BY PRICED INVOICE FOR
U.S. CUSTOMS CLEARANCE.
H. ADDITIONAL COPY OF PACKING LIST TO BE PLACED INSIDE PACKAGE.
I. LIST NUMBER OF PACKAGES ON OUTSIDE OF PACKAGES, I.E. (lof3, 2of3, ETC.).
J. SURFACE SHIPMENTS OVER 5,000 POUNDS, OVER-DIMENSIONAL, REQUIRE SPECIAL
HANDLING, EXCLUSIVE USE OF VEHICLE, OR SPECIALIZED TRANSPORTATION
EQUIPMENT, PHONE TRAFFIC MANAGEMENT FOR SPECIFIC INSTRUCTIONS 48 HOURS
PRIOR TO SHIPMENT. CALL (256) 772-2616 or 2617.
K. AIR SHIPMENTS OVER 500 POUNDS, OVER-DIMENSIONAL OR REQUIRE SPECIAL
HANDLING, PHONE TRAFFIC MANAGEMENT FOR SPECIFIC INSTRUCTIONS 24 HOURS
PRIOR TO SHIPMENT. CALL (256) 772-2616 OR 2617.
L. INSTRUCTIONS FOR DOMESTIC SHIPMENTS, INCLUDING GOVERNMENT BILL OF LADING
SHIPMENTS.
1. STANDARD (SURFACE) SHIPMENTS 150 POUNDS OR LESS PER PIECE SHIP
VIA UNITED PARCEL SERVICE (UPS). SHIP COLLECT VIA THE CONSIGNEE
BILLING PROGRAM. FOR INFORMATION ON THIS PROGRAM CALL UPS AT
1-800-354-7527. (PLEASE REFERENCE THE BOEING PURCHASE ORDER
NUMBER ON ALL PIECES).
FOR STANDARD (SURFACE) SHIPMENTS FROM 151 POUNDS TO 5,000 POUNDS
SHIP COLLECT AND REFERENCE THE BOEING PURCHASE ORDER NUMBER ON
ALL SHIPMENTS.
2. SPECIFIC STREET AND BUILDING ADDRESS MUST BE SHOWN ON ALL
SHIPMENTS.
3. WHEN PURCHASE CONTRACT DIRECTS SHIP VIA GBL (GOVERNMENT BILL OF
LADING) OBTAIN SAME FROM YOUR REGIONAL DCMAO (DEFENSE CONTRACT
MANAGEMENT AREA OFFICE).
<PAGE> 73
Purchase Contract Number JV4148 PCCO2
Dated: 04-13-99
Page 1 of 4
Exhibit B
Schedule
1.0 STATEMENT OF WORK:
Seller shall provide, as coordinated between Buyer's and Seller's Technical
Representative(s) (BTR), all labor, transportation, and supervision necessary to
furnish engineering, operations, and administrative support to the Buyer's
phases of the International Space Station (ISS) program. Seller's qualified
personnel, as detailed in Exhibit B-1, shall be co-located with Buyer's ISS
personnel shall accomplish all Seller's support.
All such support activity(ies) shall be furnished at the Buyer's Houston, Texas,
Huntsville, Alabama, Kennedy Space Center (KSC), Florida, and other locations
deemed necessary by Buyer.
All such services are as follows and shall be authorized solely in accordance
with the work order charge numbers identified in Exhibit B-2 (attached) and Cost
Authorization Account forms to be provided by the BTR's:
A. System Integration Support
Support system-level engineering, analysis, test and
verification, and integration activities.
B. Flight Software Development Support
Support flight software and data development, product
development/integrated testing, and hardware/software
integration activities. Flight software, simulation software,
and laboratory hardware/software are included within support
scope.
C. Flight Element & Subsystem Development Support
Support flight element and subsystems development, analysis,
test and verification, and integration activities.
D. Mission Integration Support
Support Launch Package integration, statusing, and issue
management. Support Stage integration planning, reviews, issue
closure, and Certification of Flight Readiness activities.
E. International Integration Support
Support integration planning, reviews, statusing, and issue
management activities for International Partner product
interfaces and integration with the ISS.
F. Operations & Utilization Support
Support ISS utilization, flight operations, logistics,
extravehicular/robotics, flight crew integration, and launch
site activities.
G. Safety & Mission Assurance Support
Support ISS safety, reliability, maintainability, and quality
assurance activities.
H. ConfiguratIon Management & Change Processing Support
Support hardware/software/data configuration
management/administrative activities. Support change
administration, definition and proposal processing.
I. Special In-Scope Technical Support
<PAGE> 74
Purchase Contract Number JV4148 PCCO2
Dated: 04-13-99
Page 2 of 4
Exhibit B
Schedule
Support other technical activities that become scope additions
to the Boeing prime integration contract at the written
direction of the Boeing Buyer.
J. Business Management Support
Support program planning and scheduling activities.
2.0 BUYER'S REPRESENTATIVES:
Notwithstanding anything contained in this Contract to the contrary, the parties
hereto agree that "Buyer's Technical Representative(s)" or designated alternate
is(are) authorized to call for and coordinate with Seller's Technical
Representative(s), and is(are) responsible for directing, all within the scope
of this Contract, the service(s) to be performed hereunder. Seller agrees that
while its representatives are at the service(s) location(s), actions of such
representatives while performing said service(s) shall be under the direction
and control of the BTR(s). Except as authorized pursuant to the Changes clause
of this Contract, the parties hereto agree that in no event will actions of the
BTR(s) result in any adjustment in the terms and provisions of this Contract.
For the purposes of this Purchase Contract, Buyer's Technical Representatives
are:
NAME DEPT. #/ PHONE
MAIL CODE NUMBER
- ---------------------------------------------------------------------------
Tim Whitney 2-6510/4S-42 (281)336-4109
- ---------------------------------------------------------------------------
Butch Stegall AG-J295/JHOU-2420 (281)244-4713
- ---------------------------------------------------------------------------
Chuck Dusold AG-J295/JHOU-HS13 (281)336-5211
- ---------------------------------------------------------------------------
Ed Gholdston
- ---------------------------------------------------------------------------
Peggy Lawrence
- ---------------------------------------------------------------------------
Brad Cohen 2-6910/HS-11 (281)336-4203
- ---------------------------------------------------------------------------
Gayle Barrow 2-6930/HS-24 (281)336-4765
- ---------------------------------------------------------------------------
Greg DeIter 2-6610/HS-21 (281)336-4209
- ---------------------------------------------------------------------------
Fred Goff
- ---------------------------------------------------------------------------
Ted Hollis 2-6610/HS-23 (281)336-4210
- ---------------------------------------------------------------------------
Phil Glynn 2-6600/HS-21 (281)336-4216
- ---------------------------------------------------------------------------
Joe Sherill 2-6982/HM-01 (281)283-5677
- ---------------------------------------------------------------------------
Jim Purcell AG-J298/JHOU-5210 (281)283-5451
- ---------------------------------------------------------------------------
Kathy Haase 2-1996/HM-04 (281)244-4920
- ---------------------------------------------------------------------------
Gary Cooper 2-6982/HM-04 (281)244-4780
- ---------------------------------------------------------------------------
Mike Raftery 2-6982/HM-04 (281)336-4936
- ---------------------------------------------------------------------------
Mark Wilson 2-6920/HM-04 (281)244-4994
- ---------------------------------------------------------------------------
Roy Tharpe
- ---------------------------------------------------------------------------
Ginger Barnes
- ---------------------------------------------------------------------------
Matt Martin 2-6614/HS-12 (281) 336-4721
- ---------------------------------------------------------------------------
Jerry Siemers 2-6510/HS-21 (281) 336-4646
- ---------------------------------------------------------------------------
Tom Hewlett 2-6610/HS-24 (281) 336-4224
- ---------------------------------------------------------------------------
Tom McCown
- ---------------------------------------------------------------------------
Frank McCall 2-6920/HS-34 (281) 336-5213
- ---------------------------------------------------------------------------
Gayle Brown
- ---------------------------------------------------------------------------
Jimmy Allison AG-J295/JHOU-2420 (281) 244-4728
- ---------------------------------------------------------------------------
Joe Kwasnieski 2-6900/HS-21 (281) 336-5266
- ---------------------------------------------------------------------------
Roger Striegel 2-1013/HS-11 (281) 336-4624
- ------------------------------------------------------------------------
It should further be understood that in no event shall the BTR(s) have any
direct management/supervisory responsibility/control over Seller's employees
assigned to perform all such service(s) associated with this Contract.
Buyer's Material Representative shall be I. T. (Tom) Henson, department 234,
mail code JHOU-2140, (281)244-4214. Seller shall contact Mr. Henson on all
contractual issues.
<PAGE> 75
Purchase Contract Number JV4148 PCCO2
Dated: 04-13-99
Page 3 of 4
Exhibit B
Schedule
3.0 SELLER'S TECHNICAL REPRESENTATIVE:
Buyer's Technical Representatives will coordinate all efforts with Seller's
Technical Representatives:
Name Department/Mail Code Number Phone
Number
- ------------------------------------------------------------------------
Jayant Ramakrishnan Dynacs- Houston Office (281)333-4419
- ------------------------------------------------------------------------
Dick Beverlin HS-23 (281)336-4272
- ------------------------------------------------------------------------
Otto Crenwelge HS-24 (281)336-4767
- ------------------------------------------------------------------------
Nancy Tracy HS-22 (281)336-4800
- ------------------------------------------------------------------------
Ajit Kwatra HS-22 (281)336-4269
- ------------------------------------------------------------------------
Ernest L. Ener HS-23 (281)336-4226
- ------------------------------------------------------------------------
Bakul Dave HS-23 (281)336-4268
- ------------------------------------------------------------------------
Ken Robinson HS-11 (281)336-4169
- ------------------------------------------------------------------------
Marietta Leonard HS-23 (281)336-4221
- ------------------------------------------------------------------------
Mike Gulizia HM-04 (281)244-4598
- ------------------------------------------------------------------------
Rick Hankel HM-01 (281)283-5573
- ------------------------------------------------------------------------
Sabeena James Tower II (281)244-4999
- ------------------------------------------------------------------------
4.0 PAYMENT RATES AND BILLING:
Seller shall invoice Buyer for all direct labor hours on a weekly basis for all
services performed herein as follows:
Labor Category
Contract Period
--------------------------------------
Period 1 Period 2 Period 3
-------- -------- --------
Member Administrative Staff -1 $10.70 $11.18 $11.68
- -----------------------------------------------------------------------------
Member Administrative Staff -2 $18.53 $19.36 $20.23
- -----------------------------------------------------------------------------
Member Administrative Staff -3 $22.46 $23.47 $24.53
- -----------------------------------------------------------------------------
Member Administrative Staff -4 $28.78 $30.08 $31.43
- -----------------------------------------------------------------------------
Member Administrative Staff -5 $34.98 $36.56 $38.20
- -----------------------------------------------------------------------------
Member Administrative Staff -6 $49.39 $51.61 $53.93
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
Member Technical Staff - 1 $24.36 $25.46 $26.60
- -----------------------------------------------------------------------------
Member Technical Staff -2 $30.13 $31.49 $32.90
- -----------------------------------------------------------------------------
Member Technical Staff -3 $37.82 $39.52 $41.30
- -----------------------------------------------------------------------------
Member Technical Staff -4 $43.46 $45.42 $47.46
- -----------------------------------------------------------------------------
Member Technical Staff -5 $51.27 $53.58 $55.99
- -----------------------------------------------------------------------------
Member Technical Staff -6 $59.96 $62.66 $65.48
- -----------------------------------------------------------------------------
Member Technical Staff -7 $73.42 $76.72 $80.17
- -----------------------------------------------------------------------------
Member Technical Staff -8 $88.05 $92.01 $96.15
- -----------------------------------------------------------------------------
Seller shall be reimbursed for actual, reasonable travel expenses incurred while
in an authorized travel status for the Buyer. All such travel shall include
transportation by Common Carrier personal automobile use, coach airfare, hotel,
meals, rental car, and miscellaneous expenses all of which in accordance with
the Federal Acquisition Regulations (FAR) Clause 31.205-46, Travel Costs. All
invoices including travel expenses shall be accompanied by documented receipts.
<PAGE> 76
Purchase Contract Number JV4148 PCCO2
Dated: 04-13-99
Page 4 of 4
Exhibit B
Schedule
5.0 Employee Reporting:
Seller shall furnish direct labor reports that will detail the charges
accumulated against each work order accounting identified in Exhibit B-2. These
reports shall include, but not necessarily be limited to:
o A weekly by employee name report by to include individual job
order number as summarized at the work order level in direct
labor hours. In a format to include, but not necessarily limited
to, the following:
1. Work Order Charge Number
2. Job Order Number (from the CAA)
3. Employee Name
4. Direct Straight Time Hours
5. Direct Overtime Hours
o A monthly report by individual job order summarized at the work
order level in direct labor hours, direct labor dollars,
non-labor dollars, and total burdened dollars. In a format to
include, but not necessarily limited to, the following:
1. Work Order Charge Number
2. Job Order Number (from the CAA)
3. Direct Straight Time Hours
4. Direct Overtime Hours
5. Billable Labor Costs
6. Travel Costs
7. Total Billable Costs
o The monthly report shall include a reconciliation to the
invoicing that is processed during the current month.
o For effort on sustaining engineering, postproduction support,
and multi element integration testing (MEIT) a monthly
equivalent person (EP) report is required. Data shall be
summarized at the work order level in regular EP's, overtime
EP's, and overtime percent.
o A monthly employee roster identifying the following:
1. Employee Name
2. Employee's Social Security Number
3. Employee's Labor Classification
4. Functional Area
These reports shall be delivered by Wednesday of each subsequent week after
start of this contract.
<PAGE> 77
Purchase Contract Number: JV4148 PCC02
Dated: 04-13-99
Page 1 of 4
Exhibit B-1
- --------------------------------------------------------------------------------
Member Administrative Staff - 1
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
High School Diploma.
General Description:
Entry level administrative position. Duties and tasks may be simple and
repetitive. Assists in more advanced functions as part of training and
development. Introduced to standard procedures. Refers most questions and
problems to higher levels. Works under immediate supervision and from detailed
verbal and written instructions. Some introductory knowledge of office related
software and desktop computers.
- --------------------------------------------------------------------------------
Member Administrative Staff - 2
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
High School Diploma plus 3 or more years of directly related experience.
General Description:
Performs general administrative support tasks. Duties and tasks are varied but
standardized. Performs some more advanced skills. Works under direct supervision
requiring minimal judgment and initiative. Fundamental knowledge of procedures.
Resolves routine questions and problems, and refers more complex issues to
higher levels, and selects from a variety of established procedures to
accomplish assigned tasks. Typically requires a working knowledge and skill in
office related software including word processing, scheduling and spreadsheet
programs.
- --------------------------------------------------------------------------------
Member Administrative Staff - 3
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
High School Diploma plus 5 or more years of directly related experience.
General Description:
Performs some specialized administrative support tasks. Some tasks are
non-routine and non-repetitive in nature. Works under moderate supervision. May
perform some professional level tasks requiring independent judgment, initiative
and tact, subject to review and approval by supervision. General knowledge of
procedures. Duties and tasks are varied and sometimes complex. Resolves most
questions and problems, and refers the more complex issues to higher levels.
Typically requires a broad knowledge and skill in office related software
including word processing, scheduling and spreadsheet programs.
- --------------------------------------------------------------------------------
<PAGE> 78
The Boeing Company
13100 Space Center Blvd.
Houston, TX 77059-3556
5-5240-ENW-200050
Dynacs Engineering
1110 NASA Road 1 Suite 650
Houston TX 77058-3310
Attn: Mr. Jayant Ramakrishnan
Subject: Purchase Contract No. HOM8XXE-197725G
Reference: Boeing Letter dated 1-31-00 Subject: Boeing Purchase Order
HOM8XXE-197725G
Dear Mr. Ramakrishnan,
This letter is intended to provide supplemental information in regards to the
recent accounting changes Boeing-Houston has completed, and specifically how
they affect our subcontract with Dynacs. The primary change is to the current
reporting and invoicing process.
Exhibit B dated 01/31/00 has bee revised to account for the changes in
accounting, specifically section 5.0 Employee Reporting. Please read this
section carefully. Note that all references to work orders have been eliminated.
Exhibit B-2 (Work Order Charge Numbers) is deleted in its entirety. Rather than
the 100 or so work orders authorized on the contract, we have elected to
categorize work into six broad categories, Design, Development, Test and
Engineering (DDT&E), Integration and Operations (I & 0), Technical Definition,
Sustaining Engineering, Multi Element Integration Testing (MEIT) and Post
Production Support (PPS). Each of the six categories has a three alpha prefix,
which identifies the category being worked. Your employees receive the work
authorization (CAA) from the Boeing Technical Representative (BTR). Dynacs
employees are authorized to work any CAA authorized by a BTR with the following
prefix:
Material Activity ID's
GTM (DDT&E)
GTN (I&O)
GTR (Tech Def)
GTT (Sustaining Engineering)
GTU (MEIT)
GTV (PPS)
Activity ID No.'s with a prefix other then those listed above are not authorized
at this time.
When submitting weekly and monthly reports, you are now required to subtotal the
data at the Material Activity ID level. See the attached sample weekly report.
In addition you will be required to submit the weekly report with each invoice.
<PAGE> 79
We do anticipate some additional adjustments, due to our accounting changes that
may or may not affect your contract. I will advise you of those changes as soon
as practical. If you have any questions regarding this letter, please don't
hesitate to call.
Sincerely,
/S/ EDEN WILLIAMS
Eden Williams
Subcontract Administrator
The Boeing Company
281-244-4211
[email protected]
Enclosures:
Sample Weekly Report
<PAGE> 80
The Boeing Company
13100 Space Center Blvd.
Houston, TX 77059-3556
01-31-00
Dynacs Engineering
1110 NASA Road 1 Suite 650
Houston TX 77058
Attn: Mr. Jayant Ramakrishnan
Subject: Boeing Purchase Order # HOM8XXE-197725G
Reference: (1) Boeing Purchase Contract JV4148.
(2) Boeing letter dated 12/15/99, subject: Boeing Purchasing System.
Enclosed is an original and one acknowledgement copy of our purchase order
number HOM8XXE-197725G
Which incorporates our previous purchase contract, with administrative changes
as discussed in our letter of December l5th, reference 2 above.
To recap our previous letter, as a result of changes in our accounting and
purchasing systems, it became necessary to re-issue all our purchase contracts
with suppliers. The only changes to the previous purchase contract that you need
to implement are as follows:
All correspondence and invoices must use the above Boeing Purchase Order number.
Correspondence and invoices that reference the previous contract number may not
be processed properly.
All Invoices must be sent to the following address (requirements for information
copies to our Houston buyers or other Houston point of contract remain
unchanged.):
The Boeing Company
5301 Bolsa Avenue
Huntington Beach, CA 92647-2099
Attn: Accounts Payable
Mail Code: H014-B419
You may notice some other differences in this purchase order -- these are not
intended to nor do they affect our underlying agreement as expressed in the
previous purchase contract. Some of these differences include:
<PAGE> 81
a. The new purchase order may show a lower total value than the original
contract. This is the result of subtracting payments made under the old
system, from the total; the difference in value will be paid as per the
terms of the purchase contract. The new order shows the reconciliation
between the old and new value by line item. Again the total of the two
numbers should equal our previous purchase contract values.
b. The new purchase order may show only one line item, when there were
multiple line items. Again, this has been addressed in the body or
comments section of the new purchase order. There is no intention to
change the number of line items or any quantities listed in the purchase
contract.
c. There is a different handling of certain accounting lines or codes in
the new purchase order. These should make no significant difference to
you unless you have been reporting information to us using our lines of
accounting. In this case, you will continue to do so, but use the new
accounting information. This will not affect most suppliers.
If you have any questions, please contact the undersigned.
Sincerely,
/S/ EDEN WILLIAMS
Eden Williams
Subcontract Administrator
(281)244-4211
<PAGE> 82
ACKNOWLEDGEMENT
OF PURCHASE ORDER
DATE CPA NO. PURCHASE ORDER NUMBER
01-27-00 M
HOM8XXE-197725G
- ------------------------------------------------------------------------------
REQUISITION NUMBER TERMS CLEARING ACCT. ACCOUNT DISTRIBUTION
MP3248l 10 DAYS, NET 30 DAYS SEE BELOW
- ------------------------------------------------------------------------------
COMPANY ACCT. NO./ SB CODE
COMPANY FUNDED RESALE I&T NO. GC-BC
SUPPLIER CODE
NAS-15-100000 YES 10-21
31667-B
- ------------------------------------------------------------------------------
TO
DYNACS ENGINEERING THE BOEING COMPANY
35111 US HIGHWAY 19 N (See below for address)
SUITE 300
PALM HARBOR FL 34684
- ------------------------------------------------------------------------------
TO
SHIP--------------------------------------------------------------------------
VIA
- ------------------------------------------------------------------------------
FOR INTERNAL USE ONLY - IN PLANT ROUTING FOB DESTINATION UNLESS NOTED
JHOU2140 HOU T2 1483- J240 44211 EDEN WILLIAMS
- ------------------------------------------------------------------------------
BUYER SUPPLIER CONTACT CERTIFIED PRIORITY PRODUCT PGM MCDE
UNDER DPAS CLASS
JZ WILLIAMS E.N. J. RAMAKRISHNAN D0-C9 630
- -------------------------------------------------------------------------------
DELIVERY SCHEDULE
- -------------------------------------------------------------------------------
ITEM QUANTITY DATE QUANTITY DATE PROVISIONS ATTACHED HERETO
AND MADE A PART HEREOF
- --------------------------------------- CONTRACT JV4148
- ---------------------------------------
EFFECTIVE DATE: 01-04-00 THRU 09-30-00
- ---------------------------------------
- -------------------------------------------------------------------------------
ITEM QUANTITY UNIT DESCRIPTION UNIT PRICE TOTAL
SEE FLYSHEET NO. 1 ATTACHED
INVOICE TO BE APPROVED BY
EDEN WILLIAMS/HM-TI DEPT J240
ALL ITEMS I & T EXEMPT.
TOTAL $4,603,099.97
- -------------------------------------------------------------------------------
ACCEPTANCE OF THE OFFER REPRESENTED BY THIS ORDER IS EXPRESSLY LIMITED TO THE
PROVISIONS HEREOF. SIGNING AND RETURNING THE ACKNOWLEDGMENT COPY OF THIS ORDER
(IF ATTACHED HERETO) OR, IN ANY EVENT, DELIVERY IN WHOLE OR IN PART OF THE
ARTICLES TO BE FURNISHED HEREUNDER SHALL CONSTITUTE ACCEPTANCE OF THIS ORDER.
THIS IS THE ENTIRE CONTRACT AND NO CHANGES OF ANY KIND WHATSOEVER ARE BINDING ON
BUYER UNLESS THEY ARE IN WRITING AND SIGNED BY AN AUTHORIZED REPRESENTATIVE OF
BUYER'S PURCHASING DEPARTMENT.
INVOICES AND PACKING SLIPS MUST INDICATE BUYER'S PURCHASE ORDER NUMBER, LINE-
ITEM NUMBER(S), UNIT(S) OF MEASURE, AND PRICE(S) EXACTLY AS REFLECTED IN THE
PURCHASE ORDER. INVOICES NOT COMPLYING WITH THE ABOVE MAY BE RETURNED FOR
CORRECTION WHICH WILL RESULT IN PAYMENT DELAY. TO EXPEDITE PAYMENT,
MAIL INVOICES TO BOLSA AVENUE. HUNTINGTON BEACH. CA 92647-2099, ATTENTION:
ACCOUNTS PAYABLE, MAIL CODE H014-B419
THE BOEING COMPANY
Addresses: 1.A. 5301 Bolsa Avenue, Huntington Beach, CA 92647-2099
1.B 1500 East Avenue M, A.F. Plant 42, Site 1 North
Palmdale, CA 93550-2108
1.C. 555 Discovery Drive, Huntsville, AL 35806-2809
1.D. 13100 Space Center Boulevard, Houston, TX 77059
1.E. 2100 Space Park Drive, Houston, TX 77058
Seller DYNACS ENGINEERING By_____________________
------------------------------
By (Manually signed) J. RAMAKRISHNAN Date 2/3/2000
--------------------------------------------- --------
Name Title SVP
JAYANT RAMAKRISHNAN
<PAGE> 83
PURCHASE ORDER FLYSHEET NO. 1
PAGE 01
PURCHASE ORDER NO. HOMBXXE-197725G
Date 01-27-00
ITEM QUANTITY DESCRIPTION UNIT PRICE
TOTAL
NOTED SELLER SHALL PROVIDE TECHNICAL,
ADMINISTRATIVE, AND OPERATIONS
ENGINEERING SUPPORT IN SUPPORT OF
BUYER'S INTERNATIONAL SPACE STATION
PROGRAM IN ACCORDANCE WITH THE
ORIGINAL STATEMENT OF WORK.
98-T303 -1230-535-GTM00257 20%
98-T303 -1230-535-GTNO1475 16%
98-T303 -1230-535-GTRO1134 16%
98-T303 -1230-535-GTTO1568 16%
98-T303 -1230-535-GTU00965 16%
98-T303 -1230-535-GTV00987 16%
FORM 3929-H REV. 9-86
<PAGE> 84
PURCHASE ORDER
DATE CPA NO. PURCHASE ORDER NUMBER
01-27-00 HOM8XXE-197725G
- ------------------------------------------------------------------------------
REQUISITION NUMBER TERMS CLEARING ACCT. ACCOUNT DISTRIBUTION
MP3248l 10 DAYS, NET 30 DAYS SEE BELOW
- ------------------------------------------------------------------------------
COMPANY ACCT. NO./ SB CODE
COMPANY FUNDED RESALE I&T NO. GC-BC SUPPLIER CODE
NAS-15-10000 YES 10-21 31667-B
- ------------------------------------------------------------------------------
TO
DYNACS ENGINEERING THE BOEING COMPANY
35111 US HIGHWAY 19 N (See below for address)
SUITE 300
PALM HARBOR FL 34684
- ------------------------------------------------------------------------------
TO
SHIP--------------------------------------------------------------------------
VIA
- ------------------------------------------------------------------------------
FOR INTERNAL USE ONLY - IN PLANT ROUTING FOB DESTINATION UNLESS NOTED
JHOU21 40 HOU T2 1483- J240 44211 EDEN WILLIAMS
- ------------------------------------------------------------------------------
BUYER SUPPLIER CONTACT CERTIFIED PRIORITY PRODUCT PGM MCDE
UNDER DPAS CLASS
JZ WILLIAMS E.N. J. RAMAKRISHNAN D0-C9 630
- -------------------------------------------------------------------------------
ITEM QUANTITY DATE QUANTITY DATE PROVISIONS ATTACHED HERETO
AND MADE A PART HEREOF
- --------------------------------------- CONTRACT JV4148
- ---------------------------------------
EFFECTIVE DATE: 01-04-00 THRU 09-30-00
- ---------------------------------------
- -------------------------------------------------------------------------------
DELIVERY SCHEDULE
- -------------------------------------------------------------------------------
ITEM QUANTITY UNIT DESCRIPTION UNIT PRICE TOTAL
SEE FLYSHEET NO. 1 ATTACHED
INVOICE TO BE APPROVED BY
EDEN WILLIAMS/HK-TI DEPT J240
ALL ITEMS I & T EXEMPT.
TOTAL $4,603,099.97
- ------------------------------------------------------------------------------
ACCEPTANCE OF THE OFFER REPRESENTED BY THIS ORDER IS EXPRESSLY LIMITED TO THE
PROVISIONS HEREOF. SIGNING AND RETURNING THE ACKNOWLEDGMENT COPY OF THIS ORDER
(IF ATTACHED HERETO) OR, IN ANY EVENT, DELIVERY IN WHOLE OR IN PART OF THE
ARTICLES TO BE FURNISHED HEREUNDER SHALL CONSTITUTE ACCEPTANCE OF THIS ORDER.
THIS IS THE ENTIRE CONTRACT AND NO CHANGES OF ANY KIND WHATSOEVER ARE BINDING ON
BUYER UNLESS THEY ARE IN WRITING AND SIGNED BY AN AUTHORIZED REPRESENTATIVE OF
BUYER'S PURCHASING DEPARTMENT.
INVOICES AND PACKING SLIPS MUST INDICATE BUYER'S PURCHASE ORDER NUMBER,
LINE-ITEM NUMBER(S). UNIT(S) OF MEASURE, AND PRICE(S) EXACTLY AS REFLECTED IN
THE PURCHASE ORDER. INVOICES NOT COMPLYING WITH THE ABOVE MAY BE RETURNED FOR
CORRECTION WHICH WILL RESULT IN PAYMENT DELAY. TO EXPEDITE PAYMENT,
MAIL INVOICES TO 5301 BOLSA AVENUE, HUNTINGTON BEACH, CA 92647-2099, ATTENTION:
ACCOUNTS PAYABLE, MAIL CODE H014-B419
THE BOEING COMPANY
Addresses: 1.A. 5301 Bolsa Avenue, Huntington Beach, CA 92647-2099
1.B. 1500 East Avenue M, A.F. Plant 42, Site 1 North
Palmdale, CA 93550-2108
1.C. 555 Discovery Drive, Huntsville, AL 35806-2809
1.D. 13100 Space Center Boulevard, Houston, TX 77059
1.E. 2100 Space Park Drive, Houston, TX 77058
PLEASE SIGN ACKNOWLEDGEMENT OF THIS
PURCHASE ORDER AND RETURN IMMEDIATELY By: /S/ EDEN WILLIAMS
ATTENTION: PURCHASING DEPARTMENT -----------------
<PAGE> 85
PURCHASE ORDER FLYSHEET NO. 1
PAGE 01
PURCHASE ORDER NO. HOM8XXE-197725G
Date 01-27-00
ITEM QUANTITY DESCRIPTION UNIT PRICE TOTAL
NOTED SELLER SHALL PROVIDE TECHNICAL,
ADMINISTRATIVE, AND OPERATIONS
ENGINEERING SUPPORT IN SUPPORT OF
BUYER'S INTERNATIONAL SPACE STATION
PROGRAM IN ACCORDANCE WITH THE
ORIGINAL STATEMENT OF WORK.
98-T303 -1230-535-GTM00257 20%
98-T303 -1230-535-GTNO1475 16%
98-T303 -1230-535-GTRO1134 16%
98-T303 -1230-535-GTTO1568 16%
98-T303 -1230-535-GTU00965 16%
98-T303 -1230-535-GTV00987 16%
FORM 3929-H REV. 9-86
<PAGE> 86
Purchase Contract Number HOM8XXE-197725G
Dated: 01-31-00
Page 1 of 4
Exhibit B
Schedule
1.0 STATEMENT OF WORK
Seller shall provide, as coordinated between Buyer's and Seller's Technical
Representative(s) (BTR), all labor, transportation, and supervision necessary to
furnish engineering, operations, and administrative support to the Buyer's
phases of the International Space Station (ISS) program. Seller's qualified
personnel, as detailed in Exhibit C, shall be co-located with Buyer's ISS
personnel shall accomplish all Seller's support.
All such support activity(ies) shall be furnished at the Buyer's Houston, Texas,
Huntsville, Alabama, Kennedy Space Center (KSC), Florida, and other locations
deemed necessary by Buyer.
All such services shall include the following:
A. System Integration Support
Support system-level engineering, analysis, test and
verification, and integration activities.
B. Flight Software Development Support
Support flight software and data development, product
development/integrated testing, and hardware/software
integration activities. Flight software, simulation software,
and laboratory hardware/software are included within support
scope.
C. Flight Element & Subsystem Development Support
Support flight element and subsystems development, analysis,
test and verification, and integration activities.
E. Mission Integration Support
Support Launch Package integration, statusing, and issue
management. Support Stage integration planning, reviews, issue
closure, and Certification of Flight Readiness activities.
F. International Integration Support
Support integration planning, reviews, statusing, and issue
management activities for International Partner product
interfaces and integration with the ISS.
F. Operations & Utilization Support
Support ISS utilization, flight operations, logistics,
extravehicular/robotics, flight crew integration, and launch
site activities.
G. Safety & Mission Assurance Support
Support ISS safety, reliability, maintainability, and quality
assurance activities.
H. Configuration Management & Change Processing Support
Support hardware/software/data configuration
management/administrative activities. Support change
administration, definition and proposal processing.
<PAGE> 87
Purchase Contract Number HOM8XXE-197725G
Dated: 01-31-00
Page 2 of 4
Exhibit B
I. Special In-Scope Technical Support
Support other technical activities that become scope additions
to the Boeing prime integration contract at the written
direction of the Boeing Buyer.
J. Business Management Support
Support program planning and scheduling activities.
2.0 BUYER'S REPRESENTATIVES
Notwithstanding anything contained in this Contract to the contrary, the parties
hereto agree that "Buyer's Technical Representative(s)" or designated alternate
is(are) authorized to call for and coordinate with Seller's Technical
Representative(s), and is(are) responsible for directing, all within the scope
of this Contract, the service(s) to be performed hereunder. Seller agrees that
while its representatives are at the service(s) location(s), actions of such
representatives while performing said service(s) shall be under the direction
and control of the BTR(s). Except as authorized pursuant to the "Changes" clause
of this Contract, the parties hereto agree that in no event will actions of the
BTR(s) result in any adjustment in the terms and provisions of this Contract.
For the purposes of this Purchase Contract, Buyer's Technical Representatives
are:
- ------------------------------------------------------------------------
NAME DEPT. #/ PHONE
MAIL CODE NUMBER
- ------------------------------------------------------------------------
Brad Cohen 5-5301/HS-11 281-336-4203
- ------------------------------------------------------------------------
Charles Dusold AG-J301/JHOU-HS34 281-336-5211
- ------------------------------------------------------------------------
Gayle Barrow 5-5301/841-ZCO1 281-853-1547
- ------------------------------------------------------------------------
Greg Deiter 5-5301/HS-21 281-336-4209
- ------------------------------------------------------------------------
James Purcell AG-T303/JHOU-5210 281 283-5451
- ------------------------------------------------------------------------
Jerry Siemers 5-5301/HS-21 281-336-4646
- ------------------------------------------------------------------------
Joseph Kwasnieski 5-5301/HS-21 281-336-5266
- ------------------------------------------------------------------------
Joseph Sherrill 5-5303/HM-04 281-244-4780
- ------------------------------------------------------------------------
Karmen Barefield 5-5301/HS-11 281-336-4726
- ------------------------------------------------------------------------
Mark Wilson 5-5301/HM-04 281-244-4994
- ------------------------------------------------------------------------
Matthias Martin 5-5615/HS-12 281-336-4721
- ------------------------------------------------------------------------
Michael Clifford 5-5301/HS-43 281-336-4815
- ------------------------------------------------------------------------
Michael Raftery 5-5301/HM-04 281-244-4936
- ------------------------------------------------------------------------
Roger Striegel 5-5301/HS-11 281-336-4624
- ------------------------------------------------------------------------
Teddy Hollis 5-5301/HS-23 281-336-4210
- ------------------------------------------------------------------------
It should further be understood that in no event shall the BTR(s) have any
direct management/supervisory responsibility/control over Seller's employees
assigned to perform all such service(s) associated with this Contract.
Buyer's Material Representative shall be Eden Williams, department 5-5240, mail
code HM-T1. Seller shall contact Eden Williams on all contractual issues.
<PAGE> 88
Purchase Contract Number HOM8XXE-197725G
Dated: 01-31-00
Page 3 of 4
Exhibit B
3.0 SELLER'S TECHNICAL REPRESENTATIVE
Buyer's Technical Representatives will coordinate all efforts with Seller's
Technical Representatives:
- -------------------------------------------------------------
Name Phone Number
- -------------------------------------------------------------
Jayant Ramakrishnan (281) 333-4419
- -------------------------------------------------------------
Dick Beverlin (281) 283-4272
- -------------------------------------------------------------
Paul Schwartz
- -------------------------------------------------------------
Nancy Tracy (281) 336-4800
- -------------------------------------------------------------
Ajit Kwatra (281) 336-4269
- -------------------------------------------------------------
Ernest L. Ener (281) 336-4226
- -------------------------------------------------------------
Basil Robbins 281-244-7380
- -------------------------------------------------------------
Mike Gulizia (281) 244-4596
- -------------------------------------------------------------
4.0 PAYMENT RATES AND BILLING
Seller shall invoice Buyer for all direct labor hours on a weekly basis for all
services performed herein as follows:
- ------------------------------------------------------------------------------
Contract Period
-----------------------------------------
Labor Category Period 1 Period 2 Period 3
- ------------------------------------------------------------------------------
Member Administrative Staff - 1 $10.70 $11.18 $11.68
- ------------------------------------------------------------------------------
Member Administrative Staff - 2 $18.53 $19.36 $20.23
- ------------------------------------------------------------------------------
Member Administrative Staff - 3 $22.46 $23.47 $24.53
- ------------------------------------------------------------------------------
Member Administrative Staff - 4 $28.78 $30.08 $31.43
- ------------------------------------------------------------------------------
Member Administrative Staff - 5 $34.98 $36.56 $38.20
- ------------------------------------------------------------------------------
Member Administrative Staff - 6 $49.39 $51.61 $53.93
- ------------------------------------------------------------------------------
Member Technical Staff - 1 $24.36 $25.46 $26.60
- ------------------------------------------------------------------------------
Member Technical Staff - 2 $30.13 $31.49 $32.90
- ------------------------------------------------------------------------------
Member Technical Staff - 3 $37.82 $39.52 $41.30
- ------------------------------------------------------------------------------
Member Technical Staff - 4 $43.46 $45.42 $47.46
- ------------------------------------------------------------------------------
Member Technical Staff - 5 $51.27 $53.58 $55.99
- ------------------------------------------------------------------------------
Member Technical Staff - 6 $59.96 $62.66 $65.48
- ------------------------------------------------------------------------------
Member Technical Staff - 7 $73.42 $76.72 $80.17
- ------------------------------------------------------------------------------
Member Technical Staff - 8 $88.05 $92.01 $96.15
- ------------------------------------------------------------------------------
Seller shall be reimbursed for actual, reasonable travel expenses incurred while
in an authorized travel status for the Buyer. All such travel shall include
transportation by Common Carrier and/or $0.31 per mile for personal automobile
use, coach airfare, hotel, meals, rental car, and miscellaneous expenses all of
which in accordance with the Federal Acquisition Regulations (FAR) Clause
31.205-46, Travel Costs. All invoices including travel expenses shall be
accompanied by itemized, documented receipts.
Seller's employee(s) must have Buyer's approval before any business travel using
a Boeing Travel Authorization Form. Seller shall have the responsibility to
arrange travel for Seller's employees.
<PAGE> 89
Purchase Contract Number HOM8XXE-197725G
Dated: 01-31-00
Page 4 of 4
Exhibit B
5.0 Employee Reporting:
Seller shall furnish direct labor reports that will detail the charges
accumulated against each of the Project Identification Codes (PIC's) noted
below:
- ----------------------------------------------------------------------------
PIC Material Activity ID Discriptions
- ----------------------------------------------------------------------------
AGPGTM GTM00257 Design, development, test, & evaluation (DDT&E)
- ----------------------------------------------------------------------------
AGPGTN GTN01475 Integration and operations (I&O)
- ----------------------------------------------------------------------------
AGPGTR GTR01134 Technical definition (Tech Def)
- ----------------------------------------------------------------------------
AGPGTT GTR01568 Sustaining engineering
- ----------------------------------------------------------------------------
AGPGTU GTU00965 Multi element integration testing (MEIT)
- ----------------------------------------------------------------------------
AGPGTV GTV00987 Post production support (PPS)
- ----------------------------------------------------------------------------
These reports shall include, but not necessarily be limited to:
o A weekly by employee name report to include the individual
Activity ID number authorized in the CAA and summarized at the
Material Activity ID number noted above in direct labor hours.
In a format to include, but not necessarily limited to, the
following:
1. Material Activity ID Number
2. CAA Activity ID Number
3. Employee Name
4. Direct Straight Time Hours
5. Direct Overtime Hours
o A monthly report by the individual Activity ID number authorized
in the CAA and summarized at the Material Activity ID number
noted above in direct labor hours, direct labor dollars,
non-labor dollars, and total burdened dollars. In a format to
include, but not necessarily limited to, the following:
1. Material Activity ID Number
2. CAA Activity ID Number
3. Direct Straight Time Hours
4. Direct Overtime Hours
5. Billable Labor Costs
6. Travel Costs
7. Total Billable Costs
o The monthly report shall include a reconciliation to the
invoicing that is processed during the current month.
o For effort on sustaining engineering, postproduction support,
and multi element integration testing (MEIT) a monthly
equivalent person (EP) report is required. Data shall be
summarized at the Material Activity ID number in regular EP's,
overtime EP's, and overtime percent.
o A monthly employee roster identifying the following:
1. Employee Name
2. Employee's Social Security Number
3. Employee's Labor Classification
4. Functional Area
These reports shall be delivered by Wednesday of each subsequent week after
start of this contract.
<PAGE> 90
Purchase Contract Number: HOM8XXE-l97725G
Dated: 01-31-00
Page 1 of 4
Exhibit B-1
- --------------------------------------------------------------------------------
Member Administrative Staff - 1
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
High School Diploma.
General Description:
Entry level administrative position. Duties and tasks may be simple and
repetitive. Assists in more advanced functions as part of training and
development. Introduced to standard procedures. Refers most questions and
problems to higher levels. Works under immediate supervision and from detailed
verbal and written instructions. Some introductory knowledge of office related
software and desktop computers.
- --------------------------------------------------------------------------------
Member Administrative Staff - 2
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
High School Diploma plus 3 or more years of directly related experience.
General Description:
Performs general administrative support tasks. Duties and tasks are varied but
standardized. Performs some more advanced skills. Works under direct supervision
requiring minimal judgment and initiative. Fundamental knowledge of procedures.
Resolves routine questions and problems, and refers more complex issues to
higher levels, and selects from a variety of established procedures to
accomplish assigned tasks. Typically requires a working knowledge and skill in
office related software including word processing, scheduling and spreadsheet
programs.
- --------------------------------------------------------------------------------
Member Administrative Staff - 3
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
High School Diploma plus 5 or more years of directly related experience.
General Description:
Performs some specialized administrative support tasks. Some tasks are
non-routine and non-repetitive in nature. Works under moderate supervision. May
perform some professional level tasks requiring independent judgment, initiative
and tact, subject to review and approval by supervision. General knowledge of
procedures. Duties and tasks are varied and sometimes complex. Resolves most
questions and problems, and refers the more complex issues to higher levels.
Typically requires a broad knowledge and skill in office related software
including word processing, scheduling and spreadsheet programs.
- --------------------------------------------------------------------------------
<PAGE> 91
Purchase Contract Number HOM8XXE-197725G
Dated: 01-31-00
Page 2 of 4
Exhibit B-1
- --------------------------------------------------------------------------------
Member Administrative Staff - 4
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
An Associate degree or the equivalent combination of education and experience
plus 8 or more years of directly related experience.
General Description:
Performs specialized administrative tasks of complex nature. Performs
professional level tasks requiring independent judgment, initiative and tact.
Determines method of collection and analysis of assigned projects. Moderate
knowledge of procedures. Relies on experience and judgment to plan and
accomplish assigned goals. Can orient, train, assign and approve work of lower
level administrative personnel. Requires a broad knowledge of administrative
related office software and personal computer proficiency.
- --------------------------------------------------------------------------------
Member Administrative Staff - 5
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
A Bachelors degree or the equivalent combination of education and experience
plus 10 or more years of directly related experience.
General Description:
Performs highly specialized administrative tasks of a complex nature. Works
under minimal supervision. Performs professional level tasks requiring
independent judgment, initiative and tact. Comprehensive knowledge of procedures
and policies. Relies on experience and judgment to plan and accomplish assigned
goals. Performs direct supervision of other administrative personnel. Serves as
a resource to others in the resolution of more complex problems and procedures.
Positions typically require a comprehensive knowledge of administrative software
including project management and scheduling tools, as well as project analysis
tools.
- --------------------------------------------------------------------------------
Member Administrative Staff - 6
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
A Bachelors degree or the equivalent combination of education and experience
plus 15 or more years of directly related experience.
General Description:
Performs highly specialized administrative tasks of a complex nature. Works
under minimal supervision. Performs professional level tasks requiring
independent judgment, initiative and tact. Comprehensive knowledge of procedures
and policies. Relies on experience and judgment to plan and accomplish assigned
goals. Performs direct supervision of other administrative personnel. Serves as
a resource to others in the resolution of more complex problems and procedures.
Positions require a comprehensive knowledge of administrative software including
project management and scheduling tools, as well as project analysis tools.
Similar to Member Administrative Staff, grade 5, but of a more senior level in
terms of directly related experience and expertise. For some positions an
advanced degree may be required.
- --------------------------------------------------------------------------------
<PAGE> 92
Purchase Contract Number HOM8XXE-197725G
Dated: 01-31-00
Page 3 of 4
Exhibit B-1
- --------------------------------------------------------------------------------
Member Technical Staff - 1
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
BS degree (or the equivalent) in an Engineering discipline or related scientific
field with 0 to 1 year of experience.
General Description:
Knows fundamental concepts, practices and procedures of particular field of
specialization. Using established procedures and working under immediate
supervision, performs assigned tasks. Work is routine and instructions are
usually detailed. Little evaluation, originality or ingenuity is required.
- --------------------------------------------------------------------------------
Member Technical Staff - 2
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
BS degree (or the equivalent) in an Engineering discipline or related scientific
field plus 1 to 3 years of directly related experience. May be entry level for
employees with a Masters Degree.
General Description:
Knows and uses well the fundamental concepts, practices and procedures of
particular field of specialization. Under supervision, performs work that is
varied and that may be somewhat difficult in character, but usually involves
limited responsibility. Some evaluation, originality or ingenuity is required.
- --------------------------------------------------------------------------------
Member Technical Staff - 3
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
BS degree (or the equivalent) in an Engineering discipline or related scientific
field plus 3 to 5 years of directly related experience, or an advanced degree in
area of specialization plus 1 to 3 years of directly related experience. Entry
level of Ph.D. level personnel.
General Description:
Possess and applies a broad knowledge of principles, practices, and procedures
of particular field of specialization to the completion of difficult
assignments. Usually works with minimum supervision, conferring with superior on
unusual matters. May be assisted by Entry/Junior or Intermediate level
personnel. Assignments are broad in nature, requiring originality and ingenuity.
- --------------------------------------------------------------------------------
Member Technical Staff - 4
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
BS degree (or the equivalent) in an Engineering discipline or related scientific
field plus 5 to 8 years of directly related experience, or an MS degree plus 3
to 5 years of directly related experience, or a Ph.D. degree plus 1 to 3 years
of directly related experience.
General Description:
Possess and applies a comprehensive knowledge of particular field of
specialization to the completion of complex assignments. Under general
supervision, plans, conducts, and supervises assignments. Reviews progress and
evaluates results. Plans and assigns personnel for given projects or tasks.
Recommends changes in procedures. Operates with substantial latitude for
unreviewed action or decision. Reviews progress with management.
- --------------------------------------------------------------------------------
<PAGE> 93
Purchase Contract Number HOM8XXE-197725G
Dated: 01-37-00
Page 4 of 4
Exhibit B-1
- --------------------------------------------------------------------------------
Member Technical Staff - 5
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
BS degree (or the equivalent) in an Engineering discipline or related scientific
field with more than 8 years of directly related experience, or a MS degree with
more than 5 years of directly related experience, or a Ph.D. degree with over 3
years of directly related experience. Assignments necessitate advanced
knowledge.
General Description:
Possess and applies a comprehensive knowledge of particular field of
specialization to the completion of significant assignments. Has well developed
leadership qualities. Crosses fields. Plans and conducts assignments, generally
involving the larger and more important projects or more than one project.
Reviews progress and evaluates results. May lead or direct projects. Assists
with the review and evaluation of personnel performance. Evaluates progress and
results and recommends major changes in procedures. Operates with considerable
latitude for unreviewed action or decision. There may be more emphasis on
personally conducting important and complex technical tasks with less project
direction responsibility.
- --------------------------------------------------------------------------------
Member Technical Staff - 6
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
BS degree (or the equivalent) in an Engineering discipline or related scientific
field with more than 12 years of directly related experience, or a MS degree
with more than 10 years of directly related experience, or a Ph.D. degree with
over 8 years of directly related experience. Assignments necessitate advanced
knowledge. May require an advanced degree in Engineering Management.
General Description:
Possess and applies an advanced knowledge of particular field of specialization
to the completion of projects of significant complexity. May require achieved
recognized standing in professional field through original contribution. Plans
and conducts work on complex projects necessitating the origination and
application of new and unique approaches. May lead or direct projects. May
represent the organization in outside discussions and forums.
- --------------------------------------------------------------------------------
Member Technical Staff - 7
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
BS degree (or the equivalent) in an Engineering discipline or related scientific
field with more than 16 years of directly related experience, or a MS degree
with more than 14 years of directly related experience, or a Ph.D. degree with
over 12 years of directly related experience. Assignments necessitate advanced
knowledge.
General Description:
Possess and applies an advanced knowledge of particular field of specialization
to the completion of projects of major complexity. Must have achieved recognized
standing in professional field through original contribution. Plans, conducts
and directs work on complex projects necessitating the origination and
application of new and unique approaches. Plans and directs projects and
supplies technical inspiration, leadership and consultation to professional
co-workers. Typically represents the organization in outside discussions and
forums. Works with wide latitude for unreviewed action or decision.
- --------------------------------------------------------------------------------
Member Technical Staff - 8
- --------------------------------------------------------------------------------
Minimum Qualification Requirements:
BS degree (or the equivalent) in an Engineering discipline or related scientific
field with more than 20 years of directly related experience, or a MS degree
with more than 16 years of directly related experience, or a Ph.D. degree with
over 14 years of directly related experience. Assignments necessitate advanced
knowledge and/or unique technical specialization and experience.
General Description:
Highest technical position in the organization. Possess and applies an advanced
knowledge of particular field of specialization to the completion of projects of
major complexity. Advanced knowledge may span a variety of fields. Has achieved
recognized standing in professional field through original contribution. Plans,
conducts and directs work on complex projects necessitating the origination and
application of new and unique approaches. Plans and directs projects and
supplies technical inspiration, leadership and consultation to professional
co-workers. Represents the organization in outside discussions and forums. Works
with wide latitude for unreviewed action or decision. There may be more emphasis
on personally conducting important and complex technical investigations. May
serve as advisor to other personnel.
- --------------------------------------------------------------------------------
<PAGE> 94
Dynacs Engineering Company, Inc. 2/2/00
Purchase Contract-HOM8XXE-1 97725G Sample Report
For Period Of: 01-01-00-01/07-00
<TABLE>
<CAPTION>
Material Activity CAA Activity ID Boeing Dynacs Employee S/T O/T Total
ID No. Number Number Manager Employee Rate Hours Hours Dollars
<S> <C> <C>
GTM00257 GTMXXXXX
GTMXXXXX
GTMXXXXX
GTMXXXXX
GTMXXXXX
GTMXXXXX
Subtotal S/T Hours O/T Hours Total Dollars
GTN01475 GTNXXXXX
GTNXXXXX
GTNXXXXX
GTNXXXXX
GTNXXXXX
GTNXXXXX
GTNXXXXX
GTNXXXXX
GTNXXXXX
GTNXXXXX
Subtotal S/T Hours O/T Hours Total Dollars
GTRO1134 GTRXXXXX
GTRXXXXX
GTRXXXXX
GTRXXXXX
GTRXXXXX
GTRXXXXX
GTRXXXXX
Subtotal S/T Hours O/T Hours Total Dollars
GTTO1568 GTTXXXXX
GTTXXXXX
GTTXXXXX
GTTXXXXX
GTTXXXXX
GTTXXXXX
GTTXXXXX
GTTXXXXX
Subtotal S/T Hours O/T Hours Total Dollars
GTU00965 GTUXXXXX
GTUXXXXX
GTUXXXXX
GTUXXXXX
</TABLE>
Page 1
<PAGE> 95
<TABLE>
<S> <C>
Dynacs Engineering Company, Inc. 2/2/00
GTUXXXXX
GTUXXXXX
GTUXXXXX
GTUXXXXX
Subtotal S/T Hours O/T Hours Total Dollars
GTV00987 GTVXXXXX
GTVXXXXX
GTVXXXXX
GTVXXXXX
GTVXXXXX
GTVXXXXX
GTVXXXXX
GTVXXXXX
Subtotal S/T Hours O/T Hours Total Dollars
Total S/T Hours O/T Hours Total Dollars
</TABLE>
Page 2
<PAGE> 96
EXCEPT FOR THE ADMINISTRATIVE CHANGES SET FORTH BELOW, THIS ACTION DOES
NOT AFFECT THE UNDERLYING TRANSACTION AS DEFINED IN PURCHASE CONTRACT
JV4148
ADMINISTRATIVE CHANGES
1. WHEREVER IN THE PURCHASE CONTRACT REFERENCE IS MADE TO JV4188. IT IS HEREBY
DELETED AND PURCHASE ORDER NO. HOM8XXE-197725G SUBSTITUTED THEREFOR.
2. The following additional administrative changes are made to the purchase
contract identified above: (A particular provision discussed below may
not be in the subject purchase contract, if it is not, it may be
ignored.
A. Work Order Charge Numbers are change, under the heading "line
item accounting" as listed by line item in the separate section
below.
B. The invoicing address for mailing and overnight express of
invoices or invoice payments wherever shown is changed to The
Boeing Company, 5301 Bolsa Avenue, Huntington Beach, CA
92647-2099, Attention: ACCOUNTS PAYABLE, Mail Code H014-B419.
C. Any references to mailing DD25O's to Seattle, Washington is
deleted.
D. The Sales/Use Tax registration number, where applicable, is
changed to #143 04 006746. (Applicable only if the purchase
contract specified a sales/use tax registration number.)
Except as changed above or otherwise herein, the delivery schedule, price or
cost and terms and conditions of Purchase Contract JV4188 remain unchanged.
NOTWITHSTANDING ANY LANGUAGE HEREIN TO THE CONTRARY, YOU ARE REQUESTED TO
PROVIDE WRITTEN ACKNOWLEDGEMENT OF RECEIPT OF THIS ORDER WITHIN THREE (3)
WORKING DAYS OR SOONER.
<PAGE> 1
Exhibit 10.3
National Aeronautics and Space Administration
Engineering
Development
Contract
[Engineering Development Directorate Logo]
NAS10-98001
October 1997
<PAGE> 2
AWARD/CONTRACT
1. THIS CONTRACT IS A RATED ORDER RATING PAGE OF PAGE
UNDER DPAS (15 CFR 700) 1 143
2. CONTRACT (Proc. Inst. Ident.) NO.
PRIME: NAS1O-98001
SUBCONTRACT:
3. EFFECTIVE DATE
10/1/1997
4. REQUISITION/PURCHASE REQUEST/PROJECT NO.
MR 971003 (F)
5. ISSUED BY: CODE OP-OSO
JOHN F. KENNEDY SPACE CENTER, NASA
PROCUREMENT OFFICE
KENNEDY SPACE CENTER, FL 32899
6. ADMINISTERED BY (If other than item 5) CODE
7. NAME AND ADDRESS OF CONTRACTOR
(No., street, city, county, State and ZIP Code)
SUBCONTRACTOR PRIME CONTRACTOR
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 North, Suite 405 1320 South Dixie Highway
Clearwater, FL 34621 Coral Gables, FL 33146
8. DELIVERY
|_| FOB ORIGIN |_| OTHER (SEE BELOW)
9. DISCOUNT FOR PROMPT PAYMENT
10. SUBMIT INVOICES ITEM
(4 copies unless otherwise specified) See Article G-2
TO THE ADDRESS SHOWN IN:
CODE OAVB3 FACILITY CODE
11. SHIP TO/MARK FOR CODE NAS10-98001
12. PAYMENT WILL BE MADE BY: CODE GG-B1-A
JOHN F. KENNEDY SPACE CENTER, NASA
COST & COMMERCIAL ACCOUNTS BRANCH
KENNEDY SPACE CENTER, FL 32899
13. AUTHORITY FOR USING OTHER THAN FULL AND OPEN COMPETITION
|X| 15 U.S.C. 637(a)(1)
|_| 10 U.S.C. 2304(c) ( ) |_| 41 U.S.C. 253(c) ( )
14. ACCOUNTING AND APPROPRIATION DATA
CW-1/2590C/400000/34/97/PF
15A. ITEM NO. 1
15B. SUPPLIES/SERVICES
Engineering Development Contract Basic Period (10/1/97 - 9/30/98)
I5C. QUANTITY 1
15D. UNIT Job
15E. UNIT PRICE 15F. AMOUNT
Cost $ 15,648,377
Max. AF $ 422,198
15G. TOTAL AMOUNT OF CONTRACT $ 16,070,575
16. TABLE OF CONTENTS (SEE FOLLOWING PAGES)
SEC. DESCRIPTION PAGE(S)
---- ----------- -------
PART I -- THE SCHEDULE
A SOLICITATION/CONTRACT FORM
B SUPPLIES OR SERVICES AND PRICES/COSTS
C DESCRIPTIONS/SPECS/WORK STATEMENTS
D PACKAGING AND MARKING
E INSPECTION AND ACCEPTANCE
F DELIVERIES OR PERFORMANCE
G CONTRACT ADMINISTRATION DATA
H SPECIAL CONTRACT REQUIREMENTS
SEC. DESCRIPTION PAGE(S)
---- ----------- -------
PART II - CONTRACT CLAUSES
I CONTRACT CLAUSES
PART III -- LIST OF DOCUMENTS, EXHIBITS AND OTHER ATTACH.
J LIST OF ATTACHMENTS
PART IV - REPRESENTATIONS AND INSTRUCTIONS
K REPRESENTATIONS, CERTIFICATIONS AND
OTHER STATEMENTS OF OFFERORS
L INSTRS, CONDS, AND NOTICES TO OFFERORS
M EVALUATION FACTORS FOR AWARD
CONTRACTING OFFICER WILL COMPLETE ITEM 17 OR 18 AS APPLICABLE
17.|X| CONTRACTOR'S NEGOTIATED AGREEMENT (Contractor is required to sign this
document and return 4 copies to issuing office.) Contractor agrees to furnish
and deliver all items or perform all the services set forth or otherwise
identified above and on any continuation sheets for the consideration stated
herein. The rights and obligations of the parties to this contract shall be
subject to and governed by the following documents: (a) this award/contract,
(b) the solicitation, if any, and (c) such provisions, representations,
certifications, and specifications, as are attached or incorporated by
reference herein. (Attachments are listed herein.)
18. |_| AWARD (Contractor is not required to sign this document.) Your offer on
Solicitation Number_______, including the additions or changes made by you
which additions or changes are set forth in full above, is hereby accepted as
to the items listed above and on any continuation sheets. This award
consummates the contract which consists of the following documents: (a) the
Government's solicitation and your offer, and (b) this award/contract. No
further contractual document is necessary.
19A. NAME AND TITLE OF SIGNER (Type or print)
See Tripartite Signature Page (next page)
20A. NAME OF CONTRACTING OFFICER
See Tripartite Signature Page (next page)
19B. NAME OF CONTRACTOR
BY______________________________________
(Signature of person authorized to sign)
19C. DATE SIGNED
20B. UNITED STATES OF AMERICA BY
BY______________________________________
(Signature of Contracting Officer)
20C. DATE SIGNED
NSN 7540-01-152-8069 26-107 STANDARD FORM 26 (REV. 4-85)
Prescribed By GSA
PREVIOUS EDITION UNUSABLE FAR (48 CFR) 53.214(a)
<PAGE> 3
NAS10-98001 (EDC) Section A
- --------------------------------------------------------------------------------
Tripartite Signature Page
Contract: NAS10-98001
Subcontract:
- --------------------------------------------------------------------------------
SUBCONTRACTOR:
Dynacs Engineering Company, Inc.
22870 US Hwy 19, North, Suite 405
Clearwater FL 34621
BY: /s/ Ramen P. Singh DATE: August 11, 1997
NAME AND TITLE: Ramen P. Singh
President
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
PRIME CONTRACTOR:
U.S Small Business Administration
1320 South Dixie Hwy
Coral Gables, FL 33146
BY:/s/ G. Rey Moran DATE: 9/22/97
NAME AND TITLE: G. Rey Moran
U.S Small Business Administration
Contracting Officer
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
PROCURING AND ADMINISTRATIVE OFFICE:
John F. Kennedy Space Center, NASA
Procurement Office, OP-OSO
Kennedy Space Center, FL 32899
BY:/s/ A. Earl Gilbert DATE:9/22/97
NAME AND TITLE: A. Earl Gilbert
Contracting Officer
- --------------------------------------------------------------------------------
2
<PAGE> 4
NAS10-98001 (EDC) Section A
- --------------------------------------------------------------------------------
Table of Contents
Section
Designation Title Page No.
- ----------- ----- -------
PART 1 (THE SCHEDULE)
Section a Standard Form 26 (Award/Contract).............................. 1
Tripartite Signature Page...................................... 2
Table of Contents.............................................. 3
Section B Supplies or Services and Prices/costs.......................... 7
Article B-1: Type of Contract............................... 7
Article B-2: Effort Required During Contract Performance.... 7
Article B-3: Contract Value................................. 8
Article B-4: Other Direct Costs............................. 8
Article B-5: Options to Extend the Period of Contract and
Options for Incremental Increase of Effort..... 8
Article B-6: Options for Other Direct Costs................. 9
Article B-7: KSC 52.231-90 Special Cost Provisions
(Mar 1992) (Modified).......................... 10
Article B-8: Incumbent Employee Earned Sick Leave and Sick
Leave Accrual.................................. 12
Article B-9: Incumbent Employee Annual Leave Accrual........ 12
Article B-10: Reserved....................................... 12
Article B-11: Coverage of Pre-Existing Medical Conditions.... 13
Article B-12: NFS 1852.232-81 Contract Funding (Jun 1990).... 13
Section C Description/specifications/work Statement ..................... 15
Article C-1: KSC 52.210-90 Scope of Work (Feb 1990)
(Modified)..................................... 15
Article C-2: Data Requirements List......................... 15
Section D Packaging and Marking ......................................... 17
Section E Inspection and Acceptance ..................................... 18
Article E-1: Inspection and Acceptance..................... 18
Article E-2: FAR 52.246-3 Inspection of Supplies - Cost-
Reimbursement (Apr 1984)...................... 18
Article E-3: FAR 52.246-5 Inspection of Services - Cost-
Reimbursement (Apr 1984)...................... 19
Section F Deliveries or Performance .................................... 21
Article F-1: Ksc 52.212-92 Place of Performance
(Feb 1990).................................... 21
Article F-2: NFS 1852.211-72 Period of Performance
(Dec 1988).................................... 21
Section G Contract Administration Data ................................. 22
Article G-1: FAR 52.252-2 Clauses Incorporated by
Reference (Jun 1988).......................... 22
Article G-2: NFS 1852.216-87 Submission of Vouchers for
Payment (Dec 1988)............................ 22
3
<PAGE> 5
NAS10-98001 (EDC) Section A
- --------------------------------------------------------------------------------
Table of Contents
Section
Designation Title Page No.
- ----------- ----- -------
Article G-3: NFS 1852.216-76 Award Fee for Service
Contracts (Oct 1996) Alternate I (Oct 1996)... 23
Article G-4: NFS 1852.227-72 Designation of New
Technology Representative and Patent
Representative (Apr 1984)..................... 24
Article G-5: NFS 1852.242-70 Technical Direction
(Sep 1993).................................... 24
Article G-6: NFS 1852.245-77 List of Installation-Provided
Property and Services (Mar 1989).............. 25
Article G-7: Base Support.................................. 26
Section H Special Contract Requirements ................................. 28
Article H-I: FAR 52.252-2 Clauses Incorporated by
Reference (Jun 1988)........................... 28
Article H-2: KSC 52.242-90 Alternate I: Controls Applicable
to Contractor's Activities (Sep 1996).......... 28
Article H-3: KSC 52.243-90 Authorized Changes (Feb 1990).... 29
Article H-4: KSC 52.223-95 Reporting of Mishaps (Oct 1996).. 29
Article H-5: KSC 52.223-91 General Safety and Accident
Prevention (Feb 1992).......................... 29
Article H-6: KSC 52.223-93 Occupational Health (Feb 1992)... 30
Article H-7: KSC 52.208-90 Motor Vehicle Management
(Feb 1990) (Modified).......................... 30
Article H-8: KSC 52.204-90 Security Controls at KSC
(Jan 1992)..................................... 30
Article H-9: Permits and Licenses........................... 31
Article H-10: NFS 1852.235-71 Key Personnel and Facilities
(Mar 1989)...................................... 32
Article H-11: NFS 1852.242-72 Observance of Legal Holidays
(Aug 1992) Alt II (Sep 1989) (Deviation)....... 32
Article H-12: NFS 1852.209-71 Limitation of Future
Contracting (Dec 1988)......................... 33
Article H-13: Technology Transfer Program.................... 33
Article H-14: Hazardous Materials/Waste Management........... 34
Article H-15: Performance Based Work Orders.................. 34
PART II (CONTRACT CLAUSES)
Section 1 Contract Clauses................................................ 35
Article I-1: FAR 52.252-2 Clauses Incorporated by
Reference (Jun 1988)........................... 35
Article I-2: FAR 52.215-42 Requirements for Cost or Pricing
Data or Information Other Than Cost or Pricing
Data -- Modifications (Jan 1997) -- Alternate IV
(Jan 1997)..................................... 38
Article I-3: FAR 52.219-17 Section 8(a) Award (Dec 1996).... 38
Article I-4: FAR 52.219-18 Notification of Competition
Limited to Eligible 8(a) Concerns (Jan 1997)... 39
Article I-5: KSC 52.227-90 Management and Protection of
Data of Third Parties (Mar 1992)............... 39
Article I-6: Reserved....................................... 40
4
<PAGE> 6
NAS10-98001 (EDC) Section A
- --------------------------------------------------------------------------------
Table of Contents
Section
Designation Title Page No.
- ----------- ----- -------
Article I-7: FAR 52.252-6 Authorized Deviations in Clauses
(Apr 1984)..................................... 40
Article I-8: NFS 1852.215-84 Ombudsman (Oct 1996)
(Modified)..................................... 40
Article I-9: FAR 52.222-42 Statement of Equivalent Rates for
Federal Hires (May 1989) ...................... 40
Article I-10: NFS 1852.237-71 Pension Portability
(Jan 1997)..................................... 42
PART III (LIST OF DOCUMENTS, EXHIBITS AND OTHER ATTACHMENTS)
Section J List of Attachments.................................... 44
Attachment J-1 Statement of Work...................................... 45
Attachment J-1, Data Requirements List................................. 54
Appendix 1
DRD-00l: Emergency Preparedness Plan ................ 56
DRD-002: Metrics Data Report ........................ 57
DRD-003: Contractor Financial Management Report (NASA
Form 533 Series) ........................... 58
DRD-004: Information Technology Reporting ........... 63
DRD-005: Motor Vehicle Utilization Plan ............. 64
DRD-006: Annual Summary of Records Holdings Report .. 65
DRD-007: Information Technology (I/T) Plan .......... 66
DRD-008: Safety Statistics Report (SSR) ............. 67
DRD-009: Acceptance Data Package (ADP) .............. 68
DRD-010: Management Plan ............................ 69
DRD-011: Safety and Health Plan ..................... 70
DRD-012: ISO 9001 Transition Plan ................... 72
DRD-013: Security Plan .............................. 73
DRD-014: Risk Assessments ........................... 74
DRD-015: Work Order Progress Chart .................. 75
DRD-016: Maintenance Plan ........................... 77
DRD-017: Maintenance Status Report .................. 78
DRD-0l8: Work Order Summary Report .................. 79
DRD-019: Automated Information Security Plan ........ 80
DRD-020: Pressure Vessel/System Certification Report. 81
DRD-021: Monthly KSC Headcount Report ............... 82
DRD-022: GIDEP Alert System ......................... 84
DRD-023: Summary Labor Report ....................... 85
DRD-024: Work Order Revision Status Report .......... 87
DRD-025: Technology Transfer Plan ................... 89
DRD-026: Technology Transfer Report ................. 91
DRD-027: Procurement Summary Report ................. 92
DRD-028: Contractor Workforce and Funding Authority
Summary Report ............................. 93
DRD-029: Contractor Resource Management Summary and
Concerns Report ............................ 94
DRD-030: Work Plan .................................. 95
DRD-031: Equal Opportunity Report ................... 96
Attachment J-1, Safety, Reliability and Maintainability Requirements...... 97
Appendix 2
5
<PAGE> 7
NAS10-98001 (EDC) Section A
- --------------------------------------------------------------------------------
Table of Contents
Section
Designation Title Page No.
- ----------- ----- -------
Attachment J-1, Work Order Procedure.................................. 104
Appendix 3
Attachment J-1, Reference and Applicable Documents.................... 111
Appendix 4
Attachment J-1, Information Technology (I/T) Planning and Review at KSC.
Appendix 5 Principles and Goals.................................. 114
Attachment J-2 Installation-provided Government Property Listing..... 116
Attachment J-3 Register of Wage Determination........................ 119
Attachment J-4 Edc Award Fee Evaluation Plan......................... 129
Attachment J-5 Glossary, Acronyms, and Abbreviations................. 134
Attachment J-6 DD Form 254 (Contract Security Classification
Specification)........................................ 141
6
<PAGE> 8
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
PART I - THE SCHEDULE
Section B
Supplies or Services and Prices/Cost
ARTICLE B-1 TYPE OF CONTRACT
This is a cost-plus-award-fee, term form of contract with a level of effort
basis. The Contractor is obligated to provide Engineering, Engineering Support,
and Facilities and Laboratory Support. Specific requirements will be levied on
the Contractor by Work Orders in accordance with the Statement of Work (SOW),
Attachment J-1.
ARTICLE B-2 EFFORT REQUIRED DURING CONTRACT PERFORMANCE
A. The Contractor shall provide non-personal services for NASA as described
in Article C-1, "Scope of Work" and Attachment J-1, "Statement of Work"
on a level of effort (LOE) basis. In performance of the described work
during the contract period set forth below, the Contractor shall not
exceed the total labor hours on the contract, including subcontractor
and overtime hours.
Table B-2
Labor Hours
---------------------------------------
Contract Period Minimum Target Maximum
--------------- ------- ------ -------
10/1/97 - 9/30/98 375,502 387,115 398,728
Option Periods
10/1/98 - 9/30/99 375,502 387,115 398,728
10/1/99 - 9/30/00 375,502 387,115 398,728
10/1/00 - 9/30/01 375,502 387,115 398,728
10/1/01 - 9/30/02 375,502 387,115 398,728
B. If the Contractor has not provided the specified minimum quantity of
total contract labor hours set forth in the above paragraph A, an
equitable downward adjustment will be made in estimated cost and
available award fee. The downward adjustment will be based on the
difference between the minimum labor hours specified under this Article
and the number of labor hours provided by the Contractor. This provision
does not affect the Government's right to reduce the quantity of labor
hours during the term of this contract pursuant to the Termination
Clause (FAR 52.249-6).
C. When the total labor hours expended reach 95% of the maximum labor hours
specified above, the Contractor shall notify the Contracting Officer as
to whether or not the Contractor believes that amount will be sufficient
for the balance of the period of performance, or if additional labor
hours will be required. In the latter case, the notification shall
include the estimated "adequate through" date for the unexpended balance
and an estimate of the additional hours required for the balance of the
period of performance. If, during the term of the contract, an increase
in the specified maximum number of labor hours becomes necessary, the
Government may elect to increase the maximum labor hours pursuant to
Article B-5, "Options to Extend the Period of Contract and Options for
Incremental Increase of Effort".
D. As used herein, the term "labor hours" shall include the productive and
non-productive time of the employees assigned to this contract
(including subcontracted and overtime labor hours).
7
<PAGE> 9
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
ARTICLE B-3 CONTRACT VALUE
A. The contract value is comprised of estimated cost and award fee as shown
in Table B-3. The Contractor may earn award fee at the end of the twelve
month basic period of performance and any twelve month option period, if
exercised.
Table B-3
Estimated Available Earned Award Adjective Contract
Contract Period Cost Award Fee Fee Score Rating Value
- -------------------------------------------------------------------------------
10/1/97 - 9/30/98 $15,648,377 $ 422,198 $TBD TBD TBD $16,070,575
----------- --------- -----------
Option Periods
10/1/98 - 9/30/99 $15,928,312 $ 433,396 $TBD TBD TBD $16,361,708
----------- --------- -----------
10/1/99 - 9/30/00 $16,221,875 $ 445,138 $TBD TBD TBD $16,667,013
----------- --------- -----------
10/1/00 - 9/30/01 $16,546,972 $ 458,142 $TBD TBD TBD $17,005,114
----------- --------- -----------
10/1/01 - 9/30/02 $16,881,876 $ 471,538 $TBD TBD TBD $17,353,414
----------- --------- -----------
The fee allocation rate for optional labor hours exercised pursuant to Article
B-5 shall be the rate applicable to the current contract period as specified
therein.
ARTICLE B-4 OTHER DIRECT COSTS
Notwithstanding the provisions of Article G-7 entitled "Base Support", the
Contractor may be required to provide Work Order related items identified in, or
required by, Work Orders issued in accordance with Attachment J-l, Appendix 3
"Work Order Procedure." These items, classified as Other Direct Costs, include,
but are not limited to, materials, supplies, equipment, maintenance services,
travel, and training. This action is authorized only if such items/services are
not available pursuant to Article G-7 entitled "Base Support." The estimated
cost of this contract includes the amount of $5,000,000 in the basic contract
period and $5,000,000 in each of the four option periods for the acquisition of
such items or services. The costs covered by this article shall be separately
accumulated and reported in accordance with DRD-003. Such costs are considered
non-fee-bearing.
ARTICLE B-5 OPTIONS TO EXTEND THE PERIOD OF CONTRACT AND
OPTIONS FOR INCREMENTAL INCREASE OF EFFORT
A. Options to Extend the Period of Contract
1. This contract is renewable for the periods identified as options
in Table B-3 at the option of the Government.
2. The Government may extend the term of the contract for the
quantities of supplies or services and period specified in the
Schedule by written modification of this contract before the
current contract performance period expires, provided that the
Government will give the Contractor a preliminary written notice
of intent to extend at least 60 days prior to expiration of any
current period of performance. The preliminary notice does not
commit the Government to exercise the option.
3. If the Government exercises any option, the extended contract
shall be considered to include this option provision.
8
<PAGE> 10
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
4. The total duration of this contract, including the exercise of
any option(s) under this clause, shall not exceed five (5)
years.
5. It is understood and agreed that any continued performance of
services from period to period shall be at the sole
determination of the Government and will be contingent upon
prior satisfactory performance. Failure to renew the contract
for any subsequent period of performance shall not be considered
as a termination for the convenience of the Government.
B. Options for Incremental Increase of Effort
The Government may unilaterally increase the number of labor hours
required to be furnished pursuant to Article B-2, during any one year
period of performance, by an amount ranging from 1 to 1,935,575 labor
hours; provided that the cumulative total of option hours exercised
does not exceed 1,935,575 labor hours for the five year contract
period. If the Government elects to exercise its option to increase the
number of labor hours, the Contractor will be notified by a contract
modification executed by the Contracting Officer. If any option is
exercised, the number of minimum, target, and maximum labor hours set
forth in Table B-2 will be increased by the number of hours exercised.
The estimated cost and available award fee in Article B-3 will be
increased as follows for each additional labor hour exercised:
If Exercised During the Period Option Labor Rate Option Fee Rate
10/01/97 - 09/30/98 [ * ] $ 0.00
------- --------
10/01/98 - 09/30/99 [ * ] $ 0.00
------- --------
10/01/99 - 09/30/00 [ * ] $ 0.00
------- --------
10/01/00 - 09/30/01 [ * ] $ 0.00
------- --------
10/01/01 - 09/30/02 [ * ] $ 0.00
------- --------
Failure to exercise any option of the contract shall not be considered
as a termination for the convenience of the Government. If the
Government exercises one or any of the options under this contract, the
contract, as amended, shall include all terms and conditions of the
contract as it exists immediately prior to the exercise of the
additional option(s).
ARTICLE B-6 OPTIONS FOR OTHER DIRECT COSTS
In addition to the amount for ODC included in Article B-4 as part of the basic
contract, the Government may increase the amount available for payment of Work
Order related items identified in, or required by, Work Orders issued in
accordance with Attachment J-1, Appendix 3 "Work Order Procedure" by not more
than the total shown below. These items, classified as Other Direct Costs,
include, but are not limited to materials, supplies, equipment, maintenance
services, travel and training. If the Government elects to exercise its option
to increase the amount available for ODC, the Contractor will be notified by a
unilateral Contract Modification executed by the Contracting Officer. Options
increasing the amounts available for ODC may be exercised one or more times, at
any time during the performance period of this contract, provided that the
cumulative total estimated cost exercised does not exceed the amount shown
below. The estimated cost in Article B-3 will be adjusted to reflect the amount
of option exercised.
9
* Confidential info. has been omitted and filed separately with the Commission.
<PAGE> 11
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CY1 CY2 CY3 CY4 CY5 Total
----------- ----------- ---------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Total ODC $ * $ * $ * $ * $ *
----------- ----------- ---------- ---------- ----------- -----------
Indirect Cost Pricing Rate * % * % * % * %
----------- ----------- ---------- ---------- ----------- -----------
Indirect Cost Amount $ * $ * $ * $ * $ *
----------- ----------- ---------- ---------- ----------- -----------
Total ODC + Indirect Costs $ * $ * $ * $ * $ *
----------- ----------- ---------- ---------- ----------- -----------
</TABLE>
ARTICLE B-7 KSC 52.231-90 SPECIAL COST PROVISIONS (MAR 1992) (MODIFIED)
Pursuant to the terms of the contract clause entitled "Allowable Cost and
Payment (NASA Deviation)", the Contractor shall be reimbursed for such actual
and allowable expenditures incurred in the performance of work required by this
contract as may be approved by the Contracting Officer subject to the following
limitations and provisions:
A. Travel - Travel required in the performance of work under this contract
must be in accordance with the Contractor's approved written travel
policy.
B. Provisional Billing Rates and Reimbursement Ceiling Rates
1. Provisional billing rates for indirect cost pools shall be set
at the discretion of the Contracting Officer based upon
proposals from the Contractor and following review by Government
auditors. These provisional rates shall be specified in writing
and may be revised either retroactively or prospectively by the
Contracting Officer. Prior to each Contractor fiscal year, the
Contractor shall submit a proposal for the coming year's
provisional billing rates. If during the course of any
particular year a significant disparity should arise between the
approved provisional billing rates and actual rates, the
Contractor shall submit a proposal requesting consideration for
revision of the provisional rates to ones more closely
reflective of the actual rates anticipated for the year. After
expiration of each of its fiscal years, at the time the
Contractor submits the final indirect cost rates proposal
required by paragraph (d)(2) of FAR 52.216-7, "Allowable Cost
and Payment", the provisional billing rates for the year in
question shall be changed to the proposed final rates, subject
to the reimbursement ceiling rates specified in the contract,
and the Contractor shall adjust its billings accordingly.
2. Notwithstanding the terms of the contract clause entitled
"Allowable Cost and Payment," the Contractor shall not be
reimbursed for General and Administrative Costs in excess of the
following ceilings:
10
* Confidential info. has been omitted and filed separately with the Commission.
<PAGE> 12
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
G&A CEILING RATES
-------------------------------------
Period Base POP(1) Lab Hr OPT(2) ODC Opt(3)
------ ----------- ------------ ----------
<S> <C> <C> <C>
October 1, 1997-December 3l, 1997 * % * % * %
----- ----- -----
January 1, 1998-December 3l, 1998 * % * % * %
----- ----- -----
January l, 1999-December 3l, 1999 * % * % * %
----- ----- -----
January l, 2000-December 3l, 2000 * % * % * %
----- ----- -----
January l, 2001-December 3l, 2001 * % * % * %
----- ----- -----
January l, 2002-September 30, 2002 * % * % * %
----- ----- -----
</TABLE>
The base for application of G&A Costs is defined as Total Cost
Input, excluding G&A expenses.
(1)Base performance period, including Basic Contract Period and
Options 1, 2, 3, and 4.
(2)Options for Incremental Increase of Effort (Article B-5).
(3)Options for Other Direct Costs (Article B-6)
C. Relocation
1. Reimbursement for relocation costs shall be in accordance with
the provisions of FAR 31.205-35. No relocation costs will be
reimbursable under this contract for employees whose residence
at time of hiring or assignment to this contract was within a
fifty (50) mile radius of Kennedy Space Center, Florida. The
average reimbursement for relocation costs shall not exceed
$5,000 unless authorized by the Contracting Officer.
2. It is mutually agreed that the Contractor shall not be entitled
to reimbursement for cost of relocating employees to their
"home" site or any other gaining Contractor activity.
D. Household Goods Shipments
1. Movement of household goods and personal effects of Contractor
employees, when the total transportation costs are to be
reimbursed by the Government, shall be made by carriers
furnishing reduced rates under Section 107.21 quotations of the
Interstate Commerce Act, when such rates are available. The
Contractor shall inform the Chief, Transportation Office,
FF-52-D, Kennedy Space Center, Florida, Telephone No. (407)
867-2860, of each planned movement, and the transportation
office will provide the Contractor with applicable instructions
for household goods movement and other support or guidance that
is requested.
2. The Contractor shall furnish the Chief, Transportation Office,
FF-S2-D, Kennedy Space Center, Florida with advanced information
of any planned mass movement of personnel (10 or more families)
thirty (30) or more days prior to the start of any major
relocations in order to provide the Government with sufficient
time for rate negotiation action.
3. Carrier's bill of lading and related shipping documents will be
annotated with the following statement:
"TRANSPORTATION HEREUNDER IS FOR THE NATIONAL
AERONAUTICS AND SPACE ADMINISTRATION, AND THE ACTUAL
TOTAL TRANSPORTATION CHARGES PAID TO THE CARRIER(S) BY
THE CONSIGNOR OR CONSIGNEE ARE TO BE
*Confidential information has been omitted and filed separately with the
Commission
11
<PAGE> 13
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
REIMBURSED BY THE GOVERNMENT, PURSUANT TO COST
REIMBURSABLE CONTRACT NO. NAS10-98001. THIS MAY BE
CONFIRMED BY CONTACTING SUCH AGENCY AT (407) 867-2860."
4. One (1) copy of all carriers' bills of lading shall be furnished
to the Chief, Transportation Office, FF-S2-D, Kennedy Space
Center, Florida on movements of household goods and personal
effects which are the result of the relocation of the Contractor
employees when the total transportation costs are to be
reimbursed by the Government. Requests for deviations from the
procedures established by this clause shall be in writing and
addressed to the Contracting Officer.
5. Such requests must be made prior to the proposed move and in
sufficient time for the Contracting Officer to make a decision.
Failure to comply with the provisions of this clause may result
in the disallowance of costs which are in excess of those which
would have resulted from utilization of reduced rates obtainable
under the provisions of this clause.
E. Severance Pay - Reimbursement of severance pay shall be in accordance
with provisions of FAR 31.205-6(g). However, in no event will the
Government reimburse the Contractor for severance pay for any Contractor
employee who voluntarily elects to stay in place and work for a
succeeding contractor.
F. Bonuses to Hourly Employees - To the extent that bonuses paid to
employees will result in a retroactive payment to account for the
adjustment of the base rate upon which overtime pay is calculated, such
retroactive payments shall not be considered allowable costs under this
contract.
ARTICLE B-8 INCUMBENT EMPLOYEE EARNED SICK LEAVE AND SICK LEAVE ACCRUAL
The Contractor shall credit the earned sick leave accounts of those incumbent
employees hired on this contract within 30 days of commencing contract
performance by transferring the earned sick leave balances of those employees as
of the last day of their employment under predecessor contract number NAS
10-11943.
The Contractor shall ensure that the sick leave accrual rates of those incumbent
employees hired on this contract within 30 days of commencing contract
performance are maintained under this contract at the same rate those employees
were accruing sick leave as of the last day of their employment under
predecessor contract NAS10-11943, the costs of these carry-over hours will not
be paid under the successor contract unless used.
ARTICLE B-9 INCUMBENT EMPLOYEE ANNUAL LEAVE ACCRUAL
The Contractor shall ensure that the annual leave accrual rates of those
incumbent employees hired on this contract within 30 days of commencing contract
performance are maintained under this contract at the same rate those employees
were accruing annual leave as of the last day of their employment under
predecessor contract NAS10-11943.
ARTICLE B-10 RESERVED
12
<PAGE> 14
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
ARTICLE B-11 COVERAGE OF PRE-EXISTING MEDICAL CONDITIONS
Health insurance provided to incumbent employees hired under this contract
within 30 days of commencing contract performance will include coverage of
pre-existing medical conditions currently covered under the insurance provided
by the incumbent contractor.
ARTICLE B-12 NFS 1852.232-81 CONTRACT FUNDING (JUN 1990)
For purposes of payment of cost, exclusive of fee, pursuant to the Limitation of
Funds clause, the total amount allotted by the Government is defined in Table
B-12.
Table B-12
<TABLE>
<CAPTION>
FUNDING
------------------------------------------------------------------------
COST
As of Contract ----------------------- TOTAL
Mod # Value ODCS OTHER TOTAL FEE COST & FEE ADEQUATE THROUGH DATE
----- ----- ---- ----- ----- ---- ---------- ---------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Basic $16,070,575 TBD TBD TBD TBD $1,000,000 October 22, 1997
-----------
</TABLE>
13
<PAGE> 15
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
THIS PAGE INTENTIONALLY LEFT BLANK
14
<PAGE> 16
NAS10-98001 (EDC) Section C
- --------------------------------------------------------------------------------
PART I - THE SCHEDULE
Section C
Description/Specifications/Work Statement
-----------------------------------------
ARTICLE C-1 KSC 52.210-90 SCOPE OF WORK (FEB 1990) (MODIFIED)
A. The Contractor shall perform, on a Work Order basis, the effort
described in Attachment J-1 entitled "Statement of Work."
B. The Government will issue Work Orders to the Contractor in accordance
with Attachment J-1, Appendix 3 "Work Order Procedure" for the
performance of work under this contract. Each Work Order will define the
specific tasks to be performed including performance standards and
metric reporting requirements. The Contractor shall accomplish the tasks
in accordance with the Work Orders, but such tasks shall not exceed the
amount of labor hours set forth in Article B-2 entitled "Effort Required
During Contract Performance."
C. The Contractor's obligation under this contract may include resolution
of unusual or emergency situations or increased work volume which may
occur from time to time. Such requirements shall be considered to be
within the general scope of the contract, entirely within the
Contractor's original contractual obligation, and will not constitute
nor be construed as a change within the meaning of the Changes clause of
this contract. However, if such work is considered by the Contractor to
be outside the scope of his contractual obligation, the Contractor,
before performing any effort pursuant to such Government direction,
shall refer such questions to the Contracting Officer for resolution.
ARTICLE C-2 DATA REQUIREMENTS LIST
A. The Contractor shall furnish all data identified and described in
Attachment J-1, Appendix 1 (Data Requirements List - KSC Form 16-245,
hereinafter called DRL) and in supplemental DRLs to be subsequently
furnished to the Contractor for additional data which the Government is
authorized to request in accordance with the terms of this contract.
Such data shall be prepared in accordance with the Data Requirement
Description - KSC Form 16-246 (hereinafter called DRD) attached to the
DRL and referenced in the DRL for each line item of data specified in
the DRL.
B. The Government reserves the right to reasonably defer the dates of
delivery of any or all line items of data specified in the DRL. Such
right may be exercised at no increase in the contract amount. The
Government also reserves the right to terminate the requirement for any
or all line items of data specified in the DRL. In the event the
Government exercises this right, the contract amount shall be subject to
equitable adjustment in accordance with the clause hereof entitled
"Changes".
C. To the extent that data required to be furnished by other provisions of
this contract are also identified and described in the DRL, or
supplemental DRLs, and in the DRDs referenced in such DRL(s), compliance
with the DRL shall be accepted as compliance with such other provisions.
In the event of conflict between the identity and description of data
called for by specific provisions of this contract and the DRL or DRDs,
the DRL and DRDs shall control the data to be furnished.
D. Nothing contained in this Data Requirements List provision shall relieve
the Contractor from furnishing data called for by, or under the
authority of, other provisions of this contract which are not identified
and described in the DRL attached to this contract. Whenever such data
are identified, either by the Contractor or the Government, they will be
listed on a DRL and described on DRDs.
15
<PAGE> 17
NAS10-98001 (EDC) Section C
- --------------------------------------------------------------------------------
E. Except as otherwise provided in this contract, the cost of data to be
furnished in response to the DRL attached to this contract is included
in the estimated cost and shall be reimbursed in accordance with the
Allowable Cost and Payment clause.
16
<PAGE> 18
NAS10-98001 (EDC) Section D
- --------------------------------------------------------------------------------
PART I - THE SCHEDULE
SECTION D
Packaging and Marking
This Section Reserved.
17
<PAGE> 19
NAS10-98001 (EDC) Section E
- --------------------------------------------------------------------------------
PART I - THE SCHEDULE
SECTION E
Inspection and Acceptance
ARTICLE E-1 INSPECTION AND ACCEPTANCE
Inspection and acceptance shall be in accordance with FAR clauses 52.246-3 And
52.246-5 And shall be performed at Kennedy Space Center, Cape Canaveral Air
Station, and such other places of performance or delivery of work required under
this contract.
ARTICLE E-2 FAR 52.246-3 INSPECTION OF SUPPLIES - COST-
REIMBURSEMENT (APR 1984)
A. Definitions
"Contractor's managerial personnel," as used in this clause, means any
of the Contractor's directors, officers, managers, superintendents, or
equivalent representatives who have supervision or direction of--
1. All or substantially all of the Contractor's business;
2. All or substantially all of the Contractor's operation at a
plant or separate location at which the contract is being
performed; or
3. A separate and complete major industrial operation connected
with performing this contract.
"Supplies," as used in this clause, includes but is not limited to raw
materials, components, intermediate assemblies, end products, lots of
supplies, and, when the contract does not include the Warranty of Data
clause, data.
B. The Contractor shall provide and maintain an inspection system
acceptable to the Government covering supplies, fabricating methods, and
special tooling under this contract. Complete records of all inspection
work performed by the Contractor shall be maintained and made available
to the Government during contract performance and for as long afterwards
as the contract requires.
C. The Government has the right to inspect and test the contract supplies,
to the extent practicable at all places and times, including the period
of manufacture, and in any event before acceptance. The Government may
also inspect the plant or plants of the Contractor or any subcontractor
engaged in the contract performance. The Government shall perform
inspections and tests in a manner that will not unduly delay the work.
D. If the Government performs inspection or test on the premises of the
Contractor or a subcontractor, the Contractor shall furnish and shall
require subcontractors to furnish all reasonable facilities and
assistance for the safe and convenient performance of these duties.
E. Unless otherwise specified in the contract, the Government shall accept
supplies as promptly as practicable after delivery; and supplies shall
be deemed accepted 60 days after delivery, unless accepted earlier.
F. At any time during contract performance, but no later than 6 months (or
such other time as may be specified in the contract) after acceptance of
the supplies to be delivered under the contract, the Government may
require the Contractor to replace or correct any supplies that are
nonconforming at time of delivery. Supplies are nonconforming when they
are defective in material or workmanship or are otherwise not in
conformity with
18
<PAGE> 20
NAS10-98001 (EDC) Section E
- --------------------------------------------------------------------------------
contract requirements. Except as otherwise provided in paragraph H.
below, the cost of replacement or correction shall be included in
allowable cost, determined as provided in the Allowable Cost and Payment
clause, but no additional fee shall be paid. The Contractor shall not
tender for acceptance supplies required to be replaced without
disclosing the former requirement for replacement or correction and,
when required, shall disclose the corrective action taken.
G. 1. If the Contractor fails to proceed with reasonable promptness to
perform required replacement or correction, the Government may--
a. by contract or otherwise, perform the replacement or
correction and charge to the Contractor any increased
cost or make an equitable reduction in any fee paid or
payable under the contract;
b. require delivery of undelivered supplies at an equitable
reduction in any fee paid or payable under the contract;
or
c. terminate the contract for default.
2. Failure to agree on the amount of increased cost to be charged
to the Contractor or to the reduction in the fee shall be a
dispute.
H. Notwithstanding paragraphs F. and G. above, the Government may at any
time require the Contractor to correct or replace, without cost to the
Government, nonconforming supplies if the nonconformances are due to (1)
fraud, lack of good faith, or willful misconduct on the part of the
Contractor's managerial personnel or (2) the conduct of one or more of
the Contractor's employees selected or retained by the Contractor after
any of the Contractor's managerial personnel has reasonable grounds to
believe that the employee is habitually careless or unqualified.
I. This clause applies in the same manner to corrected or replacement
supplies as to supplies originally delivered.
J. The Contractor shall have no obligation or liability under this contract
to replace supplies that were nonconforming at the time of delivery
except as provided in this clause or as may be otherwise provided in the
contract.
K. Except as otherwise specified in the contract, the Contractor's
obligation to correct or replace Government-furnished property shall be
governed by the clause pertaining to Government property.
ARTICLE E-3 FAR 52.246-5 INSPECTION OF SERVICES--COST- REIMBURSEMENT (APR 1984)
A. Definition. "Services," as used in this clause, includes services
performed, workmanship, and material furnished or used in performing
services.
B. The Contractor shall provide and maintain an inspection system
acceptable to the Government covering the services under this contract.
Complete records of all inspection work performed by the Contractor
shall be maintained and made available to the Government during contract
performance and for as long afterwards as the contract requires.
C. The Government has the right to inspect and test all services called for
by the contract, to the extent practicable at all places and times
during the term of the contract. The Government shall perform
inspections and tests in a manner that will not unduly delay the work.
D. If any of the services do not conform with contract requirements, the
Government may require the Contractor to perform the services again in
conformity with contract
19
<PAGE> 21
NAS10-98001 (EDC) Section E
- --------------------------------------------------------------------------------
requirements, for no additional fee. When the defects in services cannot
be corrected by reperformance, the Government may (1) require the
Contractor to take necessary action to ensure that future performance
conforms to contract requirements and (2) reduce any fee payable under
the contract to reflect the reduced value of the services performed.
E. If the Contractor fails to promptly perform the services again or to
take the action necessary to ensure future performance in conformity
with contract requirements, the Government may (1) by contract or
otherwise, perform the services and reduce any fee payable by an amount
that is equitable under the circumstances or (2) terminate the contract
for default.
20
<PAGE> 22
NAS10-98001 (EDC) Section F
- --------------------------------------------------------------------------------
PART I - THE SCHEDULE
SECTION F
Deliveries or Performance
ARTICLE F-1 KSC 52.212-92 PLACE OF PERFORMANCE (FEB 1990)
The place of performance shall be at the Kennedy Space Center, Cape Canaveral
Air Station, and at such other locations as may be approved in writing by the
Contracting officer.
ARTICLE F-2 NFS 1852.211-72 PERIOD OF PERFORMANCE (DEC 1988)
The period of performance of this contract shall be one year, from October 1,
1997 through September 30, 1998.
There are four option periods which, if exercised, extend the period of
performance as follows:
Option Period of Performance
--------- ------------------------------------------
1 October 1, 1998 through September 30, 1999
2 October 1, 1999 through September 30, 2000
3 October 1, 2000 through September 30, 2001
4 October 1, 2001 through September 30, 2002
21
<PAGE> 23
NAS10-98001 (EDC) Section G
- --------------------------------------------------------------------------------
PART I - THE SCHEDULE
Section G
Contract Administration Data
ARTICLE G-1 FAR 52.252-2 CLAUSES INCORPORATED BY REFERENCE (JUN 1988)
This contract incorporates one or more clauses by reference, with the same force
and effect as if they were given in full text. Upon request, the Contracting
Officer will make their full text available.
I. NASA FAR SUPPLEMENT (48 CFR CHAPTER 18) CLAUSES:
Clause Number Title
------------- -----
1852.242-73 NASA/CONTRACTOR FINANCIAL MANAGEMENT REPORTING (APR 1994)
1852.227-11 PATENT RIGHTS - RETENTION BY THE CONTRACTOR (SHORT FORM)
1852.242-71 TRAVEL OUTSIDE OF THE UNITED STATES (DEC 1988)
1852.243-71 SHARED SAVINGS (DEC 1996)
1852.245-71 INSTALLATION-PROVIDED GOVERNMENT PROPERTY (MAR 1989)
ARTICLE G-2 NFS 1852.216-87 SUBMISSION OF VOUCHERS FOR PAYMENT (DEC 1988)
A. Public vouchers for payment of costs shall include a reference to this
Contract No. NAS10-98001 and be forwarded through the cognizant DCAA
office to:
John F. Kennedy Space Center, NASA
Cost and Commercial Services Branch
GG-B1-A
Kennedy Space Center, FL 32899
This is the designated billing office for cost vouchers for purposes of
the Prompt Payment clause of this contract.
B. The Contractor shall prepare vouchers as follows:
1. One original Standard Form SF 1034, SF 1035, or equivalent
Contractor's attachment.
2. Seven copies of SF 1034A, SF 1035A, or equivalent Contractor's
attachment.
3. The Contractor shall mark SF 1034A copies 1, 2, 3, 4, and such
other copies as may be directed by the Contracting Officer by
insertion in the memorandum block the names and addresses as
follows:
a. Copy 1, NASA Contracting Officer
b. Copy 2, Auditor
c. Copy 3, Contractor
d. Copy 4, Contract administration office
22
<PAGE> 24
NAS10-98001 (EDC) Section G
- --------------------------------------------------------------------------------
e. Copy 5, Project management office
C. Public vouchers for payment of fee shall be prepared similarly and be
forwarded to:
John F. Kennedy Space Center, NASA
Attn: Contracting Officer
OP-OSO
Kennedy Space Center, FL 32899
This is the designated billing office for fee vouchers for purposes of
the Prompt Payment clause of this contract.
D. In the event that amounts are withheld from payment in accordance with
provisions of this contract, a separate voucher for the amount withheld
will be required before payment for that amount may be made.
ARTICLE G-3 NFS 1852.216-76 AWARD FEE FOR SERVICE CONTRACTS (OCT 1996)
ALTERNATE I (OCT 1996)
A. The Contractor can earn award fee from a minimum of zero dollars to the
maximum stated in Article B-3.
B. Beginning 12 months after the effective date of this contract, the
Government will evaluate the Contractor's performance every performance
period, including option periods exercised pursuant to Article F-2, to
determine the amount of award fee earned by the Contractor during the
period. The Contractor may submit a self-evaluation of performance for
each evaluation period under consideration. These self-evaluations will
be considered by the Government in its evaluation. The Government's Fee
Determination Official (FDO) will determine the award fee amounts based
on the Contractor's performance in accordance with Attachment J-4. The
plan may be revised unilaterally by the Government prior to the
beginning of any rating period to redirect emphasis.
C. The Government will advise the Contractor in writing of the evaluation
results. The Contracting Officer will issue a unilateral modification to
the contract that will recognize the award fee earned. The Contractor is
not required to submit a separate voucher for earned award fee. The Cost
and Commercial Service Branch, Code GG-B1-A, will make payment based on
the unilateral modification.
D. After 85% of the potential award fee has been paid, the Contracting
Officer may direct the withholding of further payment of award fee until
a reserve is set aside in an amount that the Contracting Officer
considers necessary to protect the Government's interest. This reserve
shall not exceed 15% of the total potential award fee.
E. The amount of award fee which can be awarded in each evaluation period
is limited to the amounts set forth in Article B-3. Award fee which is
not earned in a evaluation period cannot be reallocated to future
evaluation periods.
F. 1. Pending a determination of the amount of award fee earned for an
evaluation period, a portion of the available award fee for that
period will be paid to the Contractor on a monthly basis. The
portion paid will be 80% of the current period's available
amount or the equivalent of the prior period's interim fee,
whichever is lower; provided, however, that when the Contracting
Officer determines that the Contractor will not achieve a level
of performance commensurate with the provisional rate, payment
of provisional award fee will be discontinued or reduced in such
amounts as the Contracting Officer deems appropriate. The
Contracting Officer will notify the Contractor in writing if it
is determined that such discontinuance or reduction is
appropriate. This determination is not subject to the Disputes
clause.
23
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NAS10-98001 (EDC) Section G
- --------------------------------------------------------------------------------
2. In the event the amount of award fee earned, as determined by
the FDO, is less than the sum of the provisional payments made
for that period, the Contractor will either credit the next
payment voucher for the amount of such overpayment or refund the
difference to the Government, as directed by the Contracting
Officer.
3. Provisional award fee payments will be made prior to the first
award fee determination by the Government.
G. Award fee determinations made by the Government under this contract are
not subject to the Disputes clause.
ARTICLE G-4 NFS 1852.227-72 DESIGNATION OF NEW TECHNOLOGY
REPRESENTATIVE AND PATENT REPRESENTATIVE (APR 1984)
A. For purposes of administration of the clause of this contract entitled
"New Technology" or "Patent Rights-Retention by the Contractor (Short
Form)" whichever is included, the following named representatives are
hereby designated by the Contracting Officer to administer such clause:
Title Office Code Address (including zip code)
----- ----------- ----------------------------------
New Technology DE-TPO John F. Kennedy Space Center, NASA
Representative Kennedy Space Center, FL 32899
Patent DE-TPO John F. Kennedy Space Center, NASA
Representative Kennedy Space Center, FL 32899
B. Reports of reportable items, and disclosure of subject inventions,
interim reports, final reports, utilization reports, and other reports
required by the clause, as well as any correspondence with respect to
such matters, should be directed to the New Technology Representative
unless transmitted in response to correspondence or request from the
Patent Representative. Inquiries or requests regarding disposition of
rights, election of rights, or related matters should be directed to the
Patent Representative. This clause shall be included in any subcontract
hereunder requiring a New Technology clause or Patent Rights Retention
by the Contractor (Short Form) clause, unless otherwise authorized or
directed by the Contracting Officer. The respective responsibilities and
authorities of the above-named representatives are set forth in
1827.375-3 of the NASA FAR Supplement.
ARTICLE G-5 NFS 1852.242-70 TECHNICAL DIRECTION (SEP 1993)
A. Performance of the work under this contract is subject to the written
technical direction of the Contracting Officer's Technical
Representatives (COTRs), who shall be specifically appointed by the
Contracting Officer in writing in accordance with NASA FAR Supplement
1842.270. For purposes of this contract, the COTRs are the Contract
Technical Manager (CTM) and Technical Representatives (TRs). "Technical
direction" means a directive to the Contractor that approves approaches,
solutions, designs, or refinements; fills in details or otherwise
completes the general description of work or documentation items; shifts
emphasis among work areas or tasks; or furnishes similar instruction to
the Contractor. Technical direction includes requiring studies and
pursuit of certain lines of inquiry regarding matters within the general
tasks and requirements in Section C of this contract.
B. The COTR does not have the authority to, and shall not, issue any
instruction purporting to be technical direction that --
1. Constitutes an assignment of additional work outside the
Statement of Work;
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2. Constitutes a change as defined in the Changes clause;
3. Constitutes a basis for any increase or decrease in the total
estimated contract cost, the fixed fee (if any), or the time
required for contract performance;
4. Changes any of the expressed terms, conditions, or
specifications of the contract; or
5. Interferes with the Contractor's rights to perform the terms and
conditions of the contract.
C. All technical direction shall be issued in writing by the COTR.
D. The Contractor shall proceed promptly with the performance of technical
direction duly issued by the COTR in the manner prescribed by this
clause and within the COTR's authority. If, in the Contractor's opinion,
any instruction or direction by the COTR falls within any of the
categories defined in paragraph B. above, the Contractor shall not
proceed but shall notify the Contracting Officer in writing within 5
working days after receiving it and shall request the Contracting
Officer to take action as described in this clause. Upon receiving this
notification, the Contracting Officer shall either issue an appropriate
contract modification within a reasonable time or advise the Contractor
in writing within 30 days that the instruction or direction is --
1. Rescinded in its entirety; or
2. Within the requirements of the contract and does not constitute a
change under the Changes clause of the contract, and that the
Contractor should proceed promptly with its performance.
E. A failure of the Contractor and the Contracting Officer to agree that
the instruction or direction is both within the requirements of the
contract and does not constitute a change under the Changes clause, or a
failure to agree upon the contract action to be taken with respect to
the instruction or direction, shall be subject to the Disputes clause of
this contract.
F. Any action(s) taken by the Contractor in response to any direction given
by any person other than the Contracting Officer or the COTR shall be at
the Contractor's risk.
ARTICLE G-6 NFS 1852.245-77 LIST OF INSTALLATION-PROVIDED PROPERTY AND
SERVICES (MAR 1989)
In accordance with the Installation-Provided Government Property clause of this
contract, the Contractor is authorized use of the types of property and services
listed below, to the extent they are available, while on-site at the NASA
installation.
A. Office space, work area space, and utilities. The Contractor shall use
Government telephones for official purposes only. Pay telephone stations
are available for the convenience and use of employees in making
unofficial calls, both local and long distance.
B. General and special-purpose equipment, including office furniture.
1. Equipment to be made available to the Contractor for use in
performance of this contract on-site and at such other locations
as approved by the Contracting Officer is listed in Attachment
J-2. The Government retains accountability for this property
under the Installation-Provided Government Property clause,
regardless of its authorized location.
2. If the Contractor acquires property as a direct cost under this
contract, this property also shall become accountable to the
Government upon its entry into the
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NAS10-98001 (EDC) Section G
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NASA Equipment Management System (NEMS) in accordance with the
property reporting requirements of this contract.
3. The Contractor shall not bring on-site for use under this
contract any property owned or leased by the Contractor, or
other property that the Contractor is accountable for under any
other Government contract, without the Contracting Officer's
prior written approval.
C. Supplies from stores stock.
D. Publications and blank forms stocked by the installation.
E. Safety and fire protection for Contractor personnel and facilities.
F. Installation service facilities: None.
G. Medical treatment of a first aid nature for Contractor personnel
injuries or illnesses sustained during on-site duty.
H. Cafeteria privileges for Contractor employees during normal operating
hours.
I. Building maintenance for facilities occupied by Contractor personnel.
J. Moving and hauling for office moves, movement of large equipment, and
delivery of supplies. Moving services shall be provided on-site as
approved by the Contracting Officer.
K. The responsibilities of the Contractor as contemplated by paragraph (a)
of the Installation-Provided Government Property clause are defined in
the following property management directives and installation
supplements to these Directives:
1. NHB 4200.1D, NASA Equipment Management Manual
2. NHB 4200.2A, Equipment Management User's Handbook for Property
Custodians
3. NHB 4300.1, w/ch 2, NASA Personal Property Disposal Manual
4. NHB 4100.1C, NASA Materials Inventory Management Manual
ARTICLE G-7 BASE SUPPORT
A. It is the Government's policy to furnish, to the maximum practicable
extent and on a no-charge-for-use basis, available property, equipment,
and services (including internet access) for the on-site use of
contractors working at Kennedy Space Center and the Cape Canaveral Air
Station. Therefore, to avoid unnecessary duplication of facilities and
capabilities, the Contractor shall utilize available assigned Government
facilities, equipment, tools, supplies, materials, hardware and services
as specified in the attachments to this contract; and in KHB 4000.1C
w/ch 3, entitled "Supply Support System Manual."
Property items provided in accordance with the provisions of this clause
will be subject to the provisions of NFS 1852.245-71
"Installation-Provided Government Property."
B. In the event the Government is unable to provide the items specified in
paragraph A. above, or in the event the items are not available in a
timely manner through Government resources, such items as are required
in the performance of this contract may be procured by the Contractor
subject to the clause of this contract entitled "Subcontracts
(Cost-Reimbursement and Letter Contracts)."
C. The Contractor agrees to make every reasonable effort to anticipate and
make known to the Government what its requirements are sufficiently in
advance to permit the
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Government to fulfill them in a timely manner in order to minimize
Contractor procurement.
D. Items generally considered "fixtures" (i.e., become a part of the
premises when installed, such as water coolers, air-conditioners,
partitions ...) shall not be purchased by the Contractor under the
authority of this clause. Additionally, items of a capital nature shall
not be purchased under the authority of this clause without the prior
written approval of the Contracting Officer.
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PART I - THE SCHEDULE
SECTION H
Special Contract Requirements
-----------------------------
ARTICLE H-1 FAR 52.252-2 CLAUSES INCORPORATED BY REFERENCE (JUN 1988)
This contract incorporates one or more clauses by reference, with the same force
and effect as if they were given in full text. Upon request, the Contracting
Officer will make their full text available.
I. NASA FAR SUPPLEMENT (48 CFR CHAPTER 18) CLAUSES:
Clause
Number Title
------ -----
1852.208-81 RESTRICTIONS ON PRINTING AND DUPLICATING (AUG 1993)
1852.223-70 SAFETY AND HEALTH (MAR 1997)
1852.228-72 CROSS-WAIVER OF LIABILITY FOR SPACE SHUTTLE SERVICES
(SEP 1993)
1852.228-76 CROSS-WAIVER OF LIABILITY FOR SPACE STATION
ACTIVITIES (DEC 1994)
1852.228-78 CROSS-WAIVER OF LIABILITY FOR NASA EXPENDABLE LAUNCH
VEHICLE (ELV) LAUNCHES (SEP 1993)
1852.246-70 MISSION CRITICAL SPACE SYSTEM PERSONNEL RELIABILITY
PROGRAM (MAR 1997)
ARTICLE H-2 KSC 52.242-90 ALTERNATE I: CONTROLS APPLICABLE TO CONTRACTOR'S
ACTIVITIES (SEP 1996)
The below listed Kennedy Space Center publications and subsequent revisions
thereof are applicable to this contract and are incorporated herein by
reference. These issuances prescribe regulatory procedural criteria which are
applicable to the Contractor. The Contractor, upon receipt of notice of
noncompliance with any provisions of the below listed publications from the
Contracting Officer or his representatives, shall promptly take corrective
action.
KHB 1200.1C "Facilities, Systems, and Equipment Management Handbook"
KMI 1270.2A "KSC Continual Improvement"
KHB 1610.1A "KSC Security Handbook"
KHB 1610.2A "Personnel Security Handbook"
KMI 1610.2E "Photography and Photographer Identification"
KMI 1164.10A "Delegations, Redelegations and Designations"
KHB 1710.2C "Kennedy Space Center Safety Practices Handbook"
KMI 1800.2B "KSC Hazard Communication Program"
KHB 4000.1C "Supply Support System Manual"
w/ch. 3
KHB 8800.7A "Hazardous Waste Management"
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KMI 8800.8 "KSC Environmental Management"
ARTICLE H-3 KSC 52.243-90 AUTHORIZED CHANGES (FEB 1990)
The Contracting Officer or his duly appointed representative are the only
individuals authorized to issue instructions to the Contractor in matters
relating to this contract. The identification, scope of authority, and duties of
representatives of the Contracting Officer shall be set forth in letters issued
by the Contracting Officer; and copies of such designations shall be furnished
to the Contractor.
ARTICLE H-4 KSC 52.223-95 REPORTING OF MISHAPS (OCT 1996)
The Contractor shall report and investigate all mishaps in accordance with the
mishap reporting requirements in KHB 1710.2.
ARTICLE H-5 KSC 52.223-91 GENERAL SAFETY AND ACCIDENT PREVENTION (FEB 1992)
The Contractor will be required to participate in the KSC Safety Program. The
primary safety and health responsibility will be with the prime Contractor and
will include the following:
A. Maintaining continuous surveillance of Industrial Safety Operations in
the Contractor's contractual areas for detection and correction of
unsafe practices and conditions.
B. Providing a safety staff to ensure that working conditions and practices
in areas of contract responsibility are maintained in a safe manner.
C. Coordinating with the KSC Reliability and Space Vehicle Safety Division
(EI-C) on all matters pertaining to accident prevention whether between
the Contractor or other contractors or NASA elements and the Contractor.
D. Submitting a written safety plan stating how the Contractor will
implement the safety program to the Director Safety and Assurance (EI)
for review and approval in accordance with DRD-011.
E. Submitting a Monthly Safety Statistics Report in accordance with
DRD-008.
F. Ensuring that Contractor employees are provided with and use safety
clothing and equipment for hazardous operations. Responsibility for
furnishing this clothing and equipment lies with the Contractor, except
when otherwise authorized.
G. Complying with EWR-127-1, "Eastern and Western Range Safety Policies
and Procedures" for all operations performed on CCAS by the Contractor.
H. Notifying the KSC Reliability and Space Vehicle Safety Division (EI-C)
immediately when contacted by personnel from the Occupational Safety and
Health Administration. Furnishing KSC Safety Assurance (EI) copies of
all correspondence reports relating to inspection performed under the
Occupational Safety and Health Standards by the Department of Labor.
I. Furnishing a written report to KSC Safety Assurance (EI) of all
deficiencies with equipment and facilities in violation of the
Occupational Safety and Health Standards which are under their contract
SOW.
J. The Contractor agrees to insert this clause, including this paragraph J.
and any applicable Schedule Provisions, with appropriate changes of
designations of the parties, in subcontracts of every tier unless the
Contracting Officer makes a written determination of exemption from this
clause.
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Nothing herein shall be construed as imposing upon the Contractor any duty to
assure or otherwise assume responsibility for the safe operations of any other
contractor or their subcontractor performing work on behalf of the Government at
the Kennedy Space Center or for the personal safety of the agents, servants, or
employees of any such other contractors or subcontractors.
ARTICLE H-6 KSC 52.223-93 OCCUPATIONAL HEALTH (FEB 1992)
A. Occupational Health Services
The medical services set forth in KMI 1810.1G entitled "KSC Occupational
Medicine Program" dated June 19, 1996 will be provided to the Contractor
by the Government to the extent that there will not be any restriction
of the employees' rights under applicable Workmen's Compensation
statutory provisions.
Information from records generated as a result of rendition of these
medical services may be obtained from the Director, Biomedical Office
(JJ) upon written request.
B. Health Examinations and Physical Requirements Standards
The Contractor shall provide the following data to the Director,
Biomedical Office (JJ):
1. A breakdown of the various health examinations required in
support of this contract providing type, frequency, and a roster
of personnel affected.
2. The applicable physical requirements standards for personnel
certification if the Contractor has physical requirements
standards which are stricter than the applicable KSC (Federal)
standards; otherwise the KSC (Federal) physical requirements
standards are applicable to this contract.
ARTICLE H-7 KSC 52.208-90 MOTOR VEHICLE MANAGEMENT (FEB 1990) (MODIFIED)
The Contractor shall acquire and manage motor vehicles necessary to support the
performance of the contract. Such needed vehicles are to be acquired and managed
in the manner most efficient and economic to the Government. Vehicles may be
obtained from the GSA Interagency Motor Pool, commercial sources, or other
sources. Costs related to motor vehicles shall be borne by the Contractor and
reimbursed by the Government to the extent allowable in accordance with the
terms of the contract relating to the reimbursement of costs.
The Contractor will use KSC Form 7-490 (Vehicle Use Record) to record vehicle
utilization for all GSA and commercial rental vehicles. These records will be
maintained and made available at the request of the Contracting Officer for a
period of eighteen (18) months. Two copies of the monthly billings, both GSA and
commercial, for motor vehicle services will be forwarded to the Contracting
Officer each month. The Contractor shall assure that all vehicle operators are
appropriately licensed in the state. The Contractor will furnish GSA a copy of
their third-party automobile insurance policy if acquiring GSA motor vehicles.
The Contractor shall prepare and submit a Motor Vehicle Utilization Plan in
accordance with DRD-005. This plan shall, as a minimum, demonstrate the economic
and efficient management of vehicles and fuel. It shall forecast the vehicle
requirements for twelve (12) months allowing at least two (2) months advance
notice for additional requirements. It shall demonstrate the techniques utilized
by the Contractor to assure that vehicles are used for official purposes only.
ARTICLE H-8 KSC 52.204-90 SECURITY CONTROLS AT KSC (JAN 1992)
A. Identification of Employees
1. The Contractor shall require each employee engaged on the work
site to display NASA-furnished identification badges and special
access badges at all times. The Contractor shall obtain and
submit badging request forms on each person employed or
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to be employed by the Contractor under this contract. The
Contractor shall designate his own security and badging
officials to act as points of contact for the KSC Protective
Services Office. Prior to proceeding with on-site performance,
the Contractor shall submit the following information to the KSC
Protective Services Office (FF-S1), Kennedy Space Center:
a. Contract number and location of work site(s)
b. Contract commencement and completion dates
c. Status as prime or subcontractor
d. Names of designated security and badging officials.
2. Identification and badging of employees shall be accomplished as
soon as practicable after award of the contract. During
performance of the contract, the Contractor shall, upon
termination of an employee, immediately deliver badges and/or
passes issued to the employee to the KSC Protective Services
Office. It is agreed and understood that all NASA identification
badges/passes remain the property of NASA, and the Government
reserves the right to invalidate such badges/passes at any time.
B. Access to Controlled Areas within KSC
1. Certain areas within KSC have been designated as Controlled
Areas. These are normally surrounded by fencing and have an
entrance gate monitored by a guard or monitoring device. Access
into such areas is classified into "escorted" and "unescorted"
access. For each employee for which the Contractor desires to
have unescorted access, the prescribed forms must be submitted
to the KSC Protective Services Office. Due to the time required
to process requests for unescorted access, the Contractor is
advised to complete and submit the required forms as soon as
practicable after contract award. Within 14 working days after
the receipt of the forms, the KSC Protective Services Office
will determine whether the person is eligible for unescorted
access.
2. The Contractor is responsible for providing escort services for
any of his employees and/or any subcontractor employees who are
not eligible for unescorted access.
3. All requests for unescorted access by subcontractors will be
submitted through the Contractor for forwarding to the KSC
Protective Services Office.
ARTICLE H-9 PERMITS AND LICENSES
The Contractor shall procure and keep effective all necessary permits and
licenses required by the Federal, State, or local Government or subdivision
thereof, or of any other duly constructed public authority in performance of the
work unless otherwise directed by the Contracting Officer, and shall obey and
abide by all applicable laws, regulations or ordinances.
Any permit involving environmental coordination shall be submitted through the
Environmental Program Office (JJ-D).
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ARTICLE H-10 NFS 1852.235-71 KEY PERSONNEL AND FACILITIES (MAR 1989)
A. The personnel and/or facilities listed below (or specified in the
contract Schedule) are considered essential to the work being performed
under this contract. Before removing, replacing, or diverting any of the
listed or specified personnel or facilities, the Contractor shall (1)
notify the Contracting Officer reasonably in advance and (2) submit
justification (including proposed substitutions) in sufficient detail to
permit evaluation of the impact on this contract.
B. The Contractor shall make no diversion without the Contracting Officer's
written consent; provided, that the Contracting Officer may ratify in
writing the change, and that ratification shall constitute Contracting
Officer's consent required by this clause.
C. The list of personnel and/or facilities (shown below or as specified in
the contact Schedule) may, with the consent of the contracting parties,
be amended from time to time during the course of the contract to add or
delete personnel and/or facilities.
Mr. Lindsay P. Ball, Program Manager
-----------------------------------------------------------------
Mr. Stan Starr, Engineering Area Manager
-----------------------------------------------------------------
Mr. Ravi Venugopal, Information Technology Area Manager
-----------------------------------------------------------------
Mr. Larry Tuttle, Business Area Manager
-----------------------------------------------------------------
Mr. Gus Gustafson, Safety, Quality and Mission Assurance Manager
-----------------------------------------------------------------
The following Contractor facilities are considered to be essential to
the effort being performed under this contract:
-----------------------------------------------------------------
-----------------------------------------------------------------
ARTICLE H-11 NFS 1852.242-72 OBSERVANCE OF LEGAL HOLIDAYS (AUG 1992) ALT II
(SEP 1989) (DEVIATION)
A. The on-site Government personnel observe the following holidays:
New Year's Day Labor Day
Martin Luther King, Jr.'s Birthday Columbus Day
President's Day Veterans Day
Memorial Day Thanksgiving Day
Independence Day Christmas Day
Any other day designated by Federal statute, Executive Order, or the
President's proclamation.
B. When any holiday falls on a Saturday, the preceding Friday is observed.
When any holiday falls on a Sunday, the following Monday is observed.
Observance of such days by Government personnel shall not by itself be
cause for an additional period of performance, or entitlement of
compensation except as set forth within the contact.
C. When the NASA installation grants administrative leave to its Government
employees (e.g., as a result of inclement weather, potentially hazardous
conditions, or other special circumstances), Contractor personnel
working on-site or near site should also be dismissed. However, the
Contractor shall provide sufficient on-site personnel to perform
round-the-clock requirements of critical work already in process, unless
otherwise instructed by the Contacting Officer or authorized
representative.
D. Whenever administrative leave is granted to Contactor personnel pursuant
to paragraph C. above, it shall be without loss to the Contractor. The
cost of salaries and wages to the Contractor for the period of any such
excused absence shall be a reimbursable item of cost
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under this contract for employees in accordance with the Contractor's
established accounting policy.
ARTICLE H-12 NFS 1852.209-71 LIMITATION OF FUTURE CONTRACTING (DEC 1988)
A. The Contracting Officer has determined that this acquisition may give
rise to a potential organizational conflict of interest. Accordingly,
the attention of all prospective offerors is invited to FAR Subpart 9.5
Organizational Conflicts of Interest.
B. The nature of this conflict is a possible unfair competitive advantage.
C. The restrictions upon future contracting are described below:
1. If the Contractor, under the terms of this contract, or through
the performance of tasks pursuant to this contract, is required
to develop specifications or statements of work that are to be
incorporated into a solicitation, the Contractor shall be
ineligible to perform the work described in that solicitation as
a prime or first tier subcontractor under an ensuing NASA
contract. This restriction shall remain in effect for a
reasonable time as agreed to by the Contracting Officer and the
Contractor sufficient to avoid unfair competitive advantage or
potential bias (this time shall in no case be less than the
duration of the initial production contract). NASA shall not
unilaterally require the Contractor to prepare such
specifications or statements of work under this contract.
2. To the extent that the work under this contract requires access
to proprietary, business confidential, or financial data of
other companies, and as long as these data remain proprietary or
confidential, the Contractor shall protect these data from
unauthorized use and disclosure and agrees not to use them to
compete with those other companies.
ARTICLE H-13 TECHNOLOGY TRANSFER PROGRAM
A. The Contractor shall support, and participate in, the Government's
Technology Transfer/Commercialization Program by assisting the transfer
of technology developed under government contract to the private sector.
The Contractor's participation may include a number of different
activities including the following:
1. Dual-use development of cutting edge technology having
applications both within and outside the aerospace community.
2. Collaborative efforts with third parties for the purpose of
transferring technology.
3. Government sponsored technology outreach and industry assistance
programs that further the transfer of technology.
4. Applications engineering work for the purpose of adapting the
developed technology to a specific use.
B. All projects and associated agreements will be coordinated with the CTM,
DE-TPO, and directed in writing by the Contracting Officer. Agreements
will state funding requirements, project description, scope of project,
reporting requirements, and responsible NASA and contractor personnel.
Ownership of rights to the technology developed under these
collaborative and partnership activities shall be addressed in the
individual agreements. Projects utilizing government funds will be
approved by the Contracting Officer.
C. Contractor commitment to technology transfer/commercialization can be
demonstrated by the development of internal programs aimed at:
1. Education and training its workforce in technology transfer
activities.
2. Motivating its employees to report new technology as required by
FAR 52.227-11 as modified by NFS 1852.227-11.
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3. Assisting its subcontractor with technology transfer activities.
D. The Contractor shall submit a Technology Transfer Plan in accordance with
DRD-025 and report Technology Transfer Reports in accordance with DRD-026.
ARTICLE H-14 HAZARDOUS MATERIALS/WASTE MANAGEMENT
The Contractor shall designate an Environmental Coordinator to function as the
single point of contact for all environmental issues including, but not limited
to, waste storage and disposal coordination in accordance with KMI 8800.8, "KSC
Environmental Management."
ARTICLE H-15 PERFORMANCE BASED WORK ORDERS
Prior to Work Order issuance, each work requirement will be examined by the
Government to determine whether it is appropriate for Performance Based
Contracting (PBC). Effort that can be contractually defined so that the results
of the Contractor's effort can be objectively measured in terms of technical and
quality achievement, schedule progress or cost performance, will be ordered on a
PBC basis. To the extent that work is ordered on a PBC basis in lieu of a level
of effort basis, an equitable adjustment will be made to the contract.
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PART II- CONTRACT CLAUSES
SECTION I
Contract Clauses
----------------
ARTICLE I-1 FAR 52.252-2 CLAUSES INCORPORATED BY REFERENCE (JUN 1988)
This contract incorporates one or more clauses by reference, with the same force
and effect as if they were given in full text. Upon request, the Contracting
Officer will make their full text available.
I. FEDERAL ACQUISITION REGULATION (48 CFR CHAPTER 1) CLAUSES:
Clause
Number Title
------ -----
52.202-1 DEFINITIONS (OCT 1995)
52.203-3 GRATUITIES (APR 1984)
52.203-5 COVENANT AGAINST CONTINGENT FEES (APR 1984)
52.203-6 RESTRICTIONS ON SUBCONTRACTOR SALES TO THE GOVERNMENT
(JUL 1995)
52.203-7 ANTI-KICKBACK PROCEDURES (JUL 1995)
52.203-8 CANCELLATION, RESCISSION, AND RECOVERY OF FUNDS FOR
ILLEGAL OR IMPROPER ACTIVITY (JAN 1997)
52.203-10 PRICE OR FEE ADJUSTMENT FOR ILLEGAL OR IMPROPER ACTIVITY
(JAN 1997)
52.203-12 LIMITATION ON PAYMENTS TO INFLUENCE CERTAIN FEDERAL
TRANSACTIONS (JAN 1990)
52.204-2 SECURITY REQUIREMENTS (AUG 1996)
52.204-4 PRINTING/COPYING DOUBLE-SIDED ON RECYCLED PAPER (JUN 1996)
52.209-6 PROTECTING THE GOVERNMENT'S INTEREST WHEN
SUBCONTRACTING WITH CONTRACTORS DEBARRED,
SUSPENDED, OR PROPOSED FOR DEBARMENT (JUL 1995)
52.211-5 NEW MATERIAL (MAY 1995)
52.211-15 DEFENSE PRIORITY AND ALLOCATION REQUIREMENTS (SEP 1990)
52.215-2 AUDIT AND RECORDS-NEGOTIATION (AUG 1996)
52.215-22 PRICE REDUCTION FOR DEFECTIVE COST OR PRICING DATA
(OCT 1995)
52.215-23 PRICE REDUCTION FOR DEFECTIVE COST OR PRICING DATA
MODIFICATIONS (OCT 1995)
52.215-24 SUBCONTRACTOR COST OR PRICING DATA (OCT 1995)
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52.215-25 SUBCONTRACTOR COST OR PRICING DATA - MODIFICATIONS
(OCT 1995)
52.215-27 TERMINATION OF DEFINED BENEFIT PENSION PLANS (MAR 1996)
52.215-31 WAIVER OF FACILITIES CAPITAL COST OF MONEY (SEP 1987)
52.215-33 ORDER OF PRECEDENCE (JAN 1986)
52.215-39 REVERSION OF ADJUSTMENT OF PLANS FOR POSTRETIREMENT
BENEFITS OTHER THAN PENSIONS (MAR 1996)
52.215-40 NOTIFICATION OF OWNERSHIP CHANGES (FEB 1995)
52.216-7 ALLOWABLE COST AND PAYMENT (FEB 1997)
52.217-9 OPTION TO EXTEND THE TERM OF THE CONTRACT (MAR 1989)
[FILL IN: 5 YEARS]
52.219-8 UTILIZATION OF SMALL BUSINESS, SMALL DISADVANTAGED, AND
WOMEN-OWNED SMALL BUSINESS CONCERNS (OCT 1995)
52.219-14 LIMITATIONS ON SUBCONTRACTING (DEC 1996)
52.222-2 PAYMENT FOR OVERTIME PREMIUMS (JUL 1990) [FILL IN: ZERO]
52.222-3 CONVICT LABOR (AUG 1996)
52.222-4 CONTRACT WORK HOURS AND SAFETY STANDARDS ACT - OVERTIME
COMPENSATION (JUL 1995)
52.222-26 EQUAL OPPORTUNITY (APR 1984)
52.222-28 EQUAL OPPORTUNITY PREAWARD CLEARANCE OF SUBCONTRACTS
(APR 1984)
52.222-35 AFFIRMATIVE ACTION FOR SPECIAL DISABLED AND VIETNAM ERA
VETERANS (APR 1984)
52.222-36 AFFIRMATIVE ACTION FOR HANDICAPPED WORKERS (APR 1984)
52.222-37 EMPLOYMENT REPORTS ON SPECIAL DISABLED VETERANS AND
VETERANS OF THE VIETNAM ERA (JAN 1988)
52.222-41 SERVICE CONTRACT ACT OF 1965, AS AMENDED (MAY 1989)
52.223-2 CLEAN AIR AND WATER (APR 1984)
52.223-6 DRUG FREE WORKPLACE (JAN 1997)
52.223-10 WASTE REDUCTION PROGRAM (MAY 1995)
52.223-14 TOXIC CHEMICAL RELEASE REPORTING (OCT 1996)
52.227-11 PATENT RIGHTS - RETENTION BY THE CONTRACTOR (SHORT FORM)
(JUN 1989) (AS MODIFIED BY NFS 1852.227-11)
52.227-1 RIGHTS IN DATA-GENERAL (JUN 1987) (AS MODIFIED BY NFS
1852.227-14)
52.228-7 INSURANCE-LIABILITY TO THIRD PERSONS (MAR 1996)
52.232-9 LIMITATION ON WITHHOLDING OF PAYMENTS (APR 1984)
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NAS10-98001 (EDC) Section I
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52.232-17 INTEREST (JUN 1996)
52.232-18 AVAILABILITY OF FUNDS (APR 1984)
52.232-22 LIMITATION OF FUNDS (APR 1984)
52.232-23 ASSIGNMENT OF CLAIMS (JAN 1986)
52.232-25 PROMPT PAYMENT (MAR 1994)
52.232-33 MANDATORY INFORMATION FOR ELECTRONIC FUNDS TRANSFER
PAYMENT (AUG 1996)
52.233-1 DISPUTES (OCT 1995)-ALTERNATE I (DEC 1991)
52.233-3 PROTEST AFTER AWARD (AUG 1996)-ALTERNATE I (JUN 1985)
52.237-2 PROTECTION OF GOVERNMENT BUILDINGS, EQUIPMENT, AND
VEGETATION (APR 1984)
52.237-3 CONTINUITY OF SERVICES (JAN 1991)
52.239-1 PRIVACY OR SECURITY SAFEGUARDS (AUG 1996)
52.242-1 NOTICE OF INTENT TO DISALLOW COSTS (APR 1984)
52.242-3 PENALTIES FOR UNALLOWABLE COSTS (OCT 1995)
52.242-4 CERTIFICATION OF FINAL INDIRECT COSTS (JAN 1997)
52.242-13 BANKRUPTCY (JUL 1995)
52.242-15 STOP-WORK ORDER (AUG 1989) ALTERNATE I (APR 1984)
52.243-2 CHANGES-COST-REIMBURSEMENT (AUG 1987) - ALTERNATE II
(APR 1984)
52.244-2 SUBCONTRACTS (COST-REIMBURSEMENT AND LETTER CONTRACTS)
(FEB 1997) - ALTERNATE I (AUG 1996)
52.244-5 COMPETITION IN SUBCONTRACTING (DEC 1996)
52.244-6 SUBCONTRACTS FOR COMMERCIAL ITEMS AND COMMERCIAL
COMPONENTS (OCT 1995)
52.245-5 GOVERNMENT PROPERTY (COST-REIMBURSEMENT,
TIME-AND-MATERIAL, OR LABOR-HOUR CONTRACTS) (JAN 1986)
52.246-25 LIMITATION OF LIABILITY-SERVICES (FEB 1997)
52.247-1 COMMERCIAL BILL OF LADING NOTATIONS (APR 1984)
52.247-63 PREFERENCE FOR U.S.-FLAG AIR CARRIERS (JAN 1997)
52.247-67 SUBMISSION OF COMMERCIAL TRANSPORTATION BILLS TO THE
GENERAL SERVICES ADMINISTRATION FOR AUDIT (FEB 1995)
52.249-6 TERMINATION (COST-REIMBURSEMENT) (SEP 1996)
52.249-14 EXCUSABLE DELAYS (APR 1984)
52.251-1 GOVERNMENT SUPPLY SOURCES (APR 1984)
52.251-2 INTERAGENCY FLEET MANAGEMENT SYSTEM (IFMS) VEHICLES AND
RELATED SERVICES (JAN 1991)
52.253-1 COMPUTER GENERATED FORMS (JAN 1991)
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NAS10-98001 (EDC) Section I
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II. NASA FAR SUPPLEMENT (48 CFR CHAPTER 18) CLAUSES:
Clause
Number Title
------ -----
1852.216-89 ASSIGNMENT AND RELEASE FORMS (OCT 1996)
1852.219-74 USE OF RURAL AREA SMALL BUSINESSES (SEP 1990)
1852.219-76 NASA SMALL DISADVANTAGED BUSINESS GOAL (JUL 1991)
1852.228-75 MINIMUM INSURANCE COVERAGE (OCT 1988)
1852.237-70 EMERGENCY EVACUATION PROCEDURES (DEC 1988)
ARTICLE I-2 FAR 52.215-42 REOUTREMENTS FOR COST OR PRICING DATA OR INFORMATION
OTHER THAN COST OR PRICING DATA--MODIFICATIONS (JAN 1997)--ALTERNATE
IV (JAN 1997)
A. Submission of cost or pricing data is not required.
B. Provide sufficient information in contractor format, including access to
Contractor records, necessary to permit an adequate evaluation of the
proposed price in accordance with 15.804-6(a)(5). Standard Form 1448,
Proposal Cover Sheet (Cost or Pricing Data Not Required) may be used for
information other than cost or pricing data.
ARTICLE I-3 FAR 52.219-17 SECTION 8(a) AWARD (DEC 1996)
A. By execution of a contract, the Small Business Administration (SBA)
agrees to the following:
1. To furnish the supplies or services set forth in the contract
according to the specifications and the terms and conditions by
subcontracting with the Offeror who has been determined an
eligible concern pursuant to the provisions of section 8(a) of
the Small Business Act, as amended (15 U.S.C. 637(a)).
2. Except for novation agreements and advance payments, delegates
to the National Aeronautics and Space Administration the
responsibility for administering the contract with complete
authority to take any action on behalf of the Government under
the terms and conditions of the contract; provided, however that
the contracting agency shall give advance notice to the SBA
before it issues a final notice terminating the right of the
subcontractor to proceed with further performance, either in
whole or in part, under the contract.
3. That payments to be made under the contract will be made
directly to the subcontractor by the contracting activity.
4. To notify the NASA Contracting Officer immediately upon
notification by the subcontractor that the owner or owners upon
whom 8(a) eligibility was based plan to relinquish ownership or
control of the concern.
5. That the subcontactor awarded a subcontract hereunder shall have
the right of appeal from decisions of the cognizant Contracting
Officer under the "Disputes" clause of the subcontract.
B. The offeror/subcontractor agrees and acknowledges that it will, for and
on behalf of the SBA, fulfill and perform all of the requirements of the
contract.
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NAS10-98001 (EDC) Section I
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C. The offeror/subcontractor agrees that it will not subcontract the
performance of any of the requirements of this subcontract to any lower
tier subcontractor without the prior written approval of the SBA and the
cognizant NASA Contract Officer.
ARTICLE I-4 FAR 52.219-18 NOTIFICATION OF COMPETITION LIMITED TO ELIGIBLE 8(a)
CONCERNS (JAN 1997)
A. Offers are solicited only from small business concerns expressly
certified by the Small Business Administration (SBA) for participation
in the SBA's 8(a) Program and which meet the following criteria at the
time of submission of offer--
1. SIC code 8731 is specifically included in the Offeror's approved
business plan;
2. The Offeror is in conformance with the 8(a) support limitation
set forth in its approved business plan; and
3. The Offeror is in conformance with the Business Activity Targets
set forth in its approved business plan or any remedial action
directed by the SBA.
B. By submission of its offer, the Offeror represents that it meets all of
the criteria set forth in paragraph A. of this clause.
C. Any award resulting from this solicitation will be made to the Small
Business Administration, which will subcontract performance to the
successful 8(a) offeror selected through the evaluation criteria set
forth in this solicitation.
D. 1. Agreement. A small business concern submitting an offer in its
own name agrees to furnish, in performing the contract, only end
items manufactured or produced by small business concerns in the
United States. The term "United States" includes its territories
and possessions, the Commonwealth of Puerto Rico, the trust
territory of the Pacific Islands, and the District of Columbia.
If this procurement is processed under simplified acquisition
procedures and the total amount of this contract does not exceed
$25,000, a small business concern may furnish the product of any
domestic firm. This subparagraph does not apply in connection
with construction or service contracts.
2. The SBA's contractor will notify NASA's Contracting Officer in
writing immediately upon entering an agreement (either oral or
written) to transfer all or part of its stock or other ownership
interest to any other party.
ARTICLE I-5 KSC 52.227-90 MANAGEMENT AND PROTECTION OF DATA OF THIRD PARTIES
(MAR 1992)
A. In performance of this contract it is anticipated that the Contractor
may have access to, be furnished, use, or generate the following types
of data (recorded information):
1. Data of third parties bearing limited rights or restricted
rights notices submitted either to NASA or directly to the
Contractor; or
2. Other data of third parties which NASA has agreed to handle
under protective arrangements; or
3. Data generated by NASA or the Contractor for third parties which
NASA intends to control the use and dissemination thereof until
delivered to the third parties.
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NAS10-98001 (EDC) Section I
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B. In order to protect the interests of the Government and the interests of
other owners of such data, Contractor agrees with respect to data in
category 1. above, and with respect to any data in categories 2. and 3.
when so identified by the Contracting Officer, to:
1. Use and disclose such data only to the extent necessary to
perform the work required under this contract, with particular
emphasis on restricting the data to employees having a "need to
know";
2. Preclude disclosure of such data outside Contractor's
organization performing work under this contract without written
consent of the Contracting Officer; and
3. Return or dispose of such data as directed by the Contracting
Officer or the furnishing third party owner when such data is no
longer needed for contract performance.
ARTICLE I-6 RESERVED
ARTICLE I-7 FAR 52.252-6 AUTHORIZED DEVIATIONS IN CLAUSES (APR 1984)
A. The use in this solicitation or contract of any Federal Acquisition
Regulation (48 CFR Chapter 1) clause with an authorized deviation is
indicated by the addition of "(DEVIATION)" after the date of the clause.
B. The use in this solicitation or contract of any NASA FAR Supplement (48
CFR Chapter 18) clause with an authorized deviation is indicated by the
addition of "(DEVIATION)" after the name of the regulation.
ARTICLE I-8 NFS 1852.215-84 OMBUDSMAN (OCT 1996) (MODIFIED)
An ombudsman has been appointed to hear and facilitate the resolution of
concerns from Contractors during the postaward phase of this acquisition. When
requested, the ombudsman will maintain strict confidentiality as to the source
of the concern. The existence of the ombudsman is not to diminish the authority
of the Contracting Officer. Further, the ombudsman does not participate in
adjudication of formal contract disputes. Therefore, before consulting with the
ombudsman, interested parties must first address their concerns, issues,
disagreements, and/or recommendations to the Contracting Officer for resolution.
If resolution cannot be made by the Contracting Officer, interested parties may
contact the Kennedy Space Center ombudsman, who is the Deputy Center Director at
407-867-2355. Concerns, issues, disagreements, and recommendations that cannot
be resolved at the installation may be referred to the NASA ombudsman, the
Deputy Administrator for Procurement, at 202-358-2090. Please do not contact the
ombudsman to clarify technical requirements. Such inquiries shall be directed to
the Contracting Officer or as specified elsewhere in this document.
ARTICLE I-9 FAR 52.222-42 STATEMENT OF EQUIVALENT RATES FOR FEDERAL HIRES
(MAY 1989)
In compliance with the Service Contract Act of 1965, as amended, and the
regulations of the Secretary of Labor (29 CFR Part 4), this clause identifies
the classes of service employees expected to be employed under the contract and
states the wages and fringe benefits payable to each if they were employed by
the contracting agency subject to the provisions of 5 U.S.C. 5341 or 5332.
THIS STATEMENT IS FOR INFORMATION ONLY: IT IS NOT A WAGE DETERMINATION
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NAS10-98001 (EDC) Section I
- --------------------------------------------------------------------------------
A. BASIC HOURLY RATES
<TABLE>
<CAPTION>
POSITION CLASSIFICATION SCA TITLE WAGE RATE
----------------------- --------- ---------
<S> <C> <C>
NON-EXEMPT, NON-UNION
Accounting Assistant Accounting Clerk III $ 8.54
Administrative Assistant Secretary III $10.65
Administrative Assistant, Sr. Secretary IV $11.83
Word Processor Word Processor III $ 9.55
Word Processor, Sr. Word Processor III $ 9.55
Technical Illustrator Illustrator I $ 9.55
Technical Illustrator Illustrator I $11.83
Hardware Technician Machine Tool Operator $14.34
Hardware Technician, Sr. Tool & Die Maker $17.03
Shipping & Receiving Tech Shipping/Receiving Clerk $10.79
Mechanical Technician, Jr. Electrician, Maintenance $14.99
Mechanical Technician, Sr. Electrician, Maintenance $14.99
Mechanic Technician Machinery Maint. Mechanic $14.99
Mechanic Technician Machinist, Maintenance $14.99
Mechanic Technician, Sr. Machinist, Maintenance $14.99
Hardware Technician, Sr. Machinist, Maintenance $14.99
Mechanic Technician Maintenance Trades Helper $11.58
Mechanic Technician Pipefitter, Maintenance $14.99
Mechanic Technician, Sr. Pipefitter, Maintenance $14.99
Mechanic Technician Pneudraulic, Systems $14.99
Mechanic
Mechanic Technician Welder $14.99
Mechanic Technician, Sr. Welder $14.99
CAD Operator Drafter III $ 9.55
CAD Operator, Sr. Drafter III $ 9.55
CAD Operator Drafter IV $11.83
Telecommunications Tech Engineering Technician II $ 8.54
Hardware Technician Engineering Technician II $ 8.54
Mechanic Technician Engineering Technician II $ 8.54
Hardware Technician Engineering Technician III $ 9.55
Hardware Technician, Sr. Engineering Technician III $ 9.55
</TABLE>
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NAS10-98001 (EDC) Section I
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C>
Hardware Technician, Sr. Engineering Technician IV $11.83
Hardware Technician, Sr. Engineering Technician V $14.47
Mechanic Technician Engineering Technician V $14.47
Mechanic Technician Laboratory Technician $10.65
Mechanic Technician, Sr. Laboratory Technician $10.65
Hardware Technician, Sr. Inspector $15.94
</TABLE>
B. Fringes are as follows:
1. Paid holidays: New Year's Day, Martin Luther King's Birthday,
Washington's Birthday, Memorial Day, Independence Day, Labor
Day, Columbus Day, Veterans Day, Thanksgiving Day, and Christmas
Day.
2. Annual Leave: Two hours of annual leave each week for an
employee with less than three years service; three hours of
annual leave each week for an employee with three but less than
fifteen years of service; and four hours of annual leave each
week for an employee with fifteen or more years of service.
3. Life, accident and health insurance, and sick leave programs:
5.1 percent of the basic hourly rate.
4. Retirement: 7 percent of basic hourly rate.
ARTICLE I-10 NFS 1852.237-71 PENSION PORTABILITY (JAN 1997)
A. In order for pension costs attributable to employees assigned to this
contract to be allowable costs under this contract, the plans covering
such employees must:
1. Comply with all applicable Government laws and regulations;
2. Be a defined contribution plan, or a multiparty defined benefit
plan operated under a collective bargaining agreement. In either
case, the plan must be portable, i.e., the plan follows the
employee, not the employer;
3. Provide for 100 percent employee vesting at the earlier of one
year of continuous employee service or contract termination; and
4. Not be modified, terminated or a new plan adopted without the
prior written approval of the cognizant NASA Contracting
Officer.
B. The Contractor shall include paragraph A. of this clause in all
subcontracts for continuing services under a service contract if:
1. The prime contact requires pension portability;
2. The subcontracted labor dollars (excluding any burdens or
profit/fee) exceed $2,500,000 and ten percent of the total prime
contract labor dollars (excluding any burdens or profit/fee);
and
3. Either of the following conditions exists:
i. There is a continuing need for the same or similar
subcontract services for a minimum of five years
(inclusive of options), and if the subcontractor
changes, a high percentage of the predecessor
subcontractor's employees are expected to remain with
the program; or
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NAS10-98001 (EDC) Section I
- --------------------------------------------------------------------------------
ii. The employees under a predecessor subcontract were covered by
a portable pension plan, a follow-on subcontract or a
subcontract consolidating existing services is awarded, and
the total subcontract period covered by the plan covers a
minimum of five years (including both the predecessor and
successor subcontracts).
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NAS10-98001 (EDC) Section J
- --------------------------------------------------------------------------------
PART III - LIST OF DOCUMENTS, EXHIBITS, AND OTHER ATTACHMENTS
Section J
List of Attachments
-------------------
SECTION J
DESIGNATION ATTACHMENT TITLE
----------- ----------------
Attachment J-1 Statement of Work
Attachment J-1, Appendix 1 Data Requirements List/Data Requirements
Description (DRL/DRD)
Attachment J-1, Appendix 2 Safety, Reliability and Maintainability
Requirements
Attachment J-1, Appendix 3 Work Order Procedure
Attachment J-1, Appendix 4 Reference and Applicable Documents
Attachment J-1, Appendix 5 Information Technology (I/T) Planning
and Review at KSC, Principles and Goals
Attachment J-2 Installation-Provided Government
Property Listing
Attachment J-3 Register of Wage Determination
Attachment J-4 EDC Award Fee Evaluation Plan
Attachment J-5 Glossary, Acronyms, and Abbreviations
Attachment J-6 DD Form 254 (Contract Security
Classification Specification)
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NAS10-98001 (EDC) Attachment J-1
- --------------------------------------------------------------------------------
Attachment J-1
STATEMENT OF WORK
-----------------
1.0 PURPOSE
This Statement of Work (SOW), including Appendices 1 through 5, describes
the activities required to be performed by the Engineering Development
Contractor (hereinafter referred to as "The Contractor") in order to
provide engineering resources and products to the Engineering Development
Directorate (hereinafter referred to as "DE"), Kennedy Space Center (KSC),
FL.
Appendix 1 contains a listing of the Data Requirements Descriptions
and a copy of each describing the data deliverables for the contract.
Appendix 2 contains safety, reliability and maintainability
requirements.
Appendix 3 contains a description of the Work Order Procedure for
processing and approving Work Orders with selected examples of Work
Orders including performance standards and metrics.
Appendix 4 contains a listing of contract documents applicable to, or
referenced in, the contract excluding FAR and NASA FAR Supplement
clauses.
Appendix 5 contains the KSC guidelines for Information Technology
planning and review.
2.0 SCOPE
The Contractor shall be responsible for the performance of the work
described in this SOW. This work will require activities that range in
scope from providing technicians for a variety of sites, facilities, and
laboratories to providing engineering and management of complex applied
research, development, and technology projects. The overall project
planning and budgeting is the responsibility of the Government civil
service team in concert with the Contractor. Work Orders specifying
Contractor responsibilities, performance standards and metrics reporting
requirements are prepared by the Government in accordance with the Work
Order Procedure set forth in Appendix 3. Contractor staffing and detailed
planning to implement Work Order requirements are the Contractor's
responsibility.
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NAS10-98001 (EDC) Attachment J-1
- --------------------------------------------------------------------------------
3.0 REQUIREMENTS
3.1 GENERAL
Government administration and control of the contract will be
accomplished through the KSC Contracting Officer (CO). Technical
management and direction will be furnished by the Contract Technical
Manager (CTM) and Technical Representatives (TRs) appointed by the CO.
The Contractor shall work with the CTM and TRs to integrate Work Order
efforts to assure well-coordinated and consolidated results.
The Contractor shall provide supervision of its employees and overall
direction and integration for all aspects of this contract to ensure
that the work activities specified in this SOW are accomplished
economically and effectively in compliance with requirements. The
Contractor shall establish interfaces to achieve appropriate
coordination with NASA/KSC, other KSC contractors, and other NASA
Centers and their contractors. In the event of joint occupancy(1)
within a facility or laboratory, the Government will have the
responsibility for prioritizing the use of Government facilities,
laboratories, and equipment.
The Contractor shall provide those plans, procedures, data and reports
identified in the Data Requirements List (DRL) and described in Data
Requirements Descriptions (DRD) specified in Appendix 1. The
Contractor shall establish a resource reporting system, to include
subcontractors, for total contract work activity. The reporting system
shall have the capability to identify near-term and long-range
requirements including workforce, material, and equipment. The system
shall also have the capability of providing cost projections and
metrics reporting as necessary to accomplish work activities required
by the Government.
The Contractor shall make maximum use of available Government
equipment, supplies, and services and procure only equipment,
supplies, or services which are not readily available and which are
required to support accomplishment of assigned tasks. The Contractor
shall utilize Commercial-Off-The-Shelf (COTS) equipment where
appropriate.
The National Environmental Policy Act (NEPA) mandates that all
"Federal actions significantly affecting the quality of the human
environment" be evaluated. All KSC contractor actions are considered
"Federal actions" as they are performed in support of Government
activities. Specific guidance and responsibilities for environmental
documentation for this Center are outlined in KHB 1200.1, "Facilities,
Systems, and Equipment Management Handbook." The Contractor is
responsible for developing the required environmental documentation
for its assigned projects. These environmental analyses and
- ----------------------------
(1) Joint Occupancy means that there may be other contractors or NASA employees
utilizing the same facilities/laboratories during a particular schedule period.
This is an intermittent condition and may affect one or more
facilities/laboratories at any particular time. Adequate notice will be provided
prior to a joint occupancy condition.
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NAS10-98001 (EDC) Attachment J-1
- --------------------------------------------------------------------------------
assessments must be submitted through the CTM for signature and/or
transmittal to outside agencies.
3.2 ENGINEERING
The Contractor shall perform requirements analyses, cost analysis,
designs, studies, and investigations for research and engineering
development tasks. These tasks will involve the use and knowledge of
past aerospace design practices that were applied to existing ground
systems as well as current state-of-the-art techniques and
technologies for potential application of new requirements. The
engineering tasks may involve, but are not limited to, areas such as
propellants and gases, cryogenics, hypergolics, pneumatics,
hydraulics, fiber optics, communication systems, instrumentation,
navigational aids, hazardous gas detection, intelligent systems,
robotics, multimedia, biomedical engineering, computer hardware,
software, and networking, environmental control systems, mechanical
and structural systems, stress and load analyses, launch-induced
environments including acoustic and thermal analyses, data analyses,
material science, atmospheric science, and environmental science. All
Ground Support Equipment (GSE) design engineering tasks shall be
accomplished in accordance with KSC-DE-512-SM, "Facility, System, and
Equipment General Design Requirements" or with SSP 50004, "Ground
Support Equipment Design Requirements, International Space Station",
as appropriate. Operational software development activities shall be
in accordance with Appendix 2 "Safety, Reliability and Maintainability
Requirements." In addition to NASA and KSC standards and practices,
the Contractor shall comply with telecommunications standards defined
by the National Institute of Standards and Technology (NIT), mandatory
Federal Information Processing (FIP) Standards, and Federal
Telecommunication Standards (FED-STD).
The Contractor shall have the capability for preparing all requisite
project management planning documents, requirements, technical
approaches or conceptual designs, work breakdown structures, detailed
and summary Gantt chart schedules, resource allocation histograms,
PERT/CPM diagrams including critical-path calculations, detailed and
summary budget and time-related spending plan, identification of key
milestones, and the Contractor's plan for managing the project.
The Contractor shall work with organizations as required by Work Order
to develop design requirements, engineering reports, and/or design
concepts. The Contractor shall prepare technical assessments and
evaluations of requirements to include an implementation cost estimate,
installation and testing requirements, an environmental analysis, and
any necessary trade studies, including cost-benefit analyses.
Assessments shall include, but not be limited to, impacts to:
schedules, processes, procedures, performance, safety, reliability,
47
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NAS10-98001 (EDC) Attachment J-1
- --------------------------------------------------------------------------------
operability, documentation, hardware, software, maintainability, and
spares identification.
The Contractor shall prepare complete design packages or parts thereof.
A complete design package is defined as the technical effort required to
convert preliminary designs or conceptual engineering into the drawings
and specifications necessary for procurement, fabrication, installation,
operation, and maintenance of new or modified equipment or facilities.
In addition to drawings and specifications, a complete design package
may contain shop drawings, engineering instructions, Failure Modes and
Effects Analysis (FMEA), Operations and Maintenance Documentation (OMD),
test procedures, cost estimates, parts lists, software requirements and
criteria, software, schedules, environmental data, and other pertinent
design data. The Contractor shall conduct periodic design reviews in
accordance with DE-P 450, "Design Reviews." Design packages shall be
checked by the Contractor to assure that technical requirements have
been met and editorial errors or omissions have been eliminated prior to
approval and release by the Government for implementation.
The Contractor shall thoroughly review designs during the design process
and prior to engineering release to assure appropriate safety, quality,
maintainability, and reliability requirements are incorporated in the
design package. The Contractor shall develop component, subsystem, and
system qualification test requirements, criteria, plans, and procedures.
The Contractor shall provide the necessary fabrication, design
verification and testing of new or upgraded designs to substantiate the
design approach. This effort may also include demonstrations,
engineering analysis, and preparation of reports.
The Contractor shall provide and maintain technical expertise in all key
technical disciplines for assigned laboratories and other technical
areas. The Contractor shall maintain expert knowledge and awareness of
the current state-of-the-art in these disciplines in industry, academia,
and other Government laboratories and programs.
The Contractor shall support and participate in the Government
Technology Transfer/Commercialization Program including providing
technical expertise to Florida industries in support of KSC's Outreach
Program.
When no appropriate technology exists, the Contractor shall provide the
necessary scientific and engineering resources to develop the
appropriate technology. The Contractor shall validate and document the
chosen technical approach.
The Contractor shall develop and perform qualification testing of
components or systems for use in KSC GSE.
48
<PAGE> 50
NAS10-98001 (EDC) Attachment J-1
- --------------------------------------------------------------------------------
The Contractor shall perform acceptance testing of systems or components
developed for DE by the Contractor or by other organizations. The
acceptance test procedures and test results will be approved by DE.
The Contractor shall prepare turnover documentation for transfer of
operations, maintenance, and sustaining engineering responsibility for
completed components or systems to customers including Acceptance Data
Packages per DRD-009.
The Contractor shall perform applications engineering, laboratory tests,
and design problem resolution for components or systems previously
delivered and or turned over to customers.
The Contractor shall utilize existing Government-owned computer-aided
engineering, computer-aided drafting and other automation tools such as
interactive design, analysis, and graphics systems as the primary method
of operation. The Contractor may use manual drafting and other methods
of documentation when necessary.
The Contractor shall be responsible for development, documentation, and
in-service inspection and certification of all DE responsible pressure
systems in accordance with KHB 1710.2C, Annex E, "KSC Safety Practices
Handbook."
The Contractor shall provide sustaining engineering for DE facilities,
laboratories, systems, equipment, and components as defined by Work
Order.
3.3 ENGINEERING SUPPORT
The Contractor shall provide engineering support which includes
technical writing, multimedia, illustrating, engineering drafting, and
cost estimating.
The Contractor shall prepare and maintain Engineering Standards,
Specifications, and Procedures. This includes a detailed review of NMIs,
NHBs, KMIs, KHBs, and other documents to assure that DE working
procedures, standards, and specifications are in compliance and provide
recommendations for updating when not in compliance. Activities include
research, writing, review, editing, typing, and proofreading required to
produce a complete document ready for approval and reproduction.
The Contractor shall prepare technical and management multimedia
suitable for use in audio/visual presentations, technical reports,
plans, operation and maintenance manuals, training classes, technology
transfers, etc.
The Contractor shall prepare engineering drawings, block diagrams,
schematics, printed circuit layouts, parts lists, layouts, and other
associated documentation required for engineering design, studies,
criteria, conceptual designs, configuration baselines, and completed
engineering activities. All applicable documentation shall be prepared
in accordance with GP-435, "Engineering
49
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NAS10-98001 (EDC) Attachment J-1
- --------------------------------------------------------------------------------
Drawing Practices/Volumes I and II" and KSC-DF-107, "DE Technical
Documentation Style Guide."
The Contractor shall prepare Drawing Release Authorizations per DE-P
720, "Document Release Authorization (DRA)," for Government signature
prior to release. Engineering Documentation Center services will be
provided by the Base Operations Contractor.
The Contractor shall provide support to the KSC standard parts
programs.
The Contractor shall provide support for maintenance and generation of
component specifications and lists using data sources such as Problem
Reporting and Corrective Action (PRACA), NASA Alerts, and the
Government Industry Data Exchange Program (GIDEP) (DRD-022).
The Contractor shall conduct field surveys, gather technical
information, and provide operational data to support Government
requirements for reviews, special briefings, and investigations.
The Contractor shall provide cost estimating for new projects,
alterations, modifications, contract changes, and studies as requested.
All cost estimating tasks shall be accomplished in accordance with
KSC-SPEC-G...0002, "Compiling Construction Cost Estimates,
Specification for" and KSC SPEC-G-0003, "Ground Support Equipment Cost
Estimating, Specification for."
3.4 FACILITIES AND LABORATORIES SUPPORT
The Contractor shall provide technical support to assigned facilities
and laboratories. These facilities and laboratories are used by various
contractor and civil service organizations at KSC for design,
development, and research activities. They are also for the
Contractor's use in performing research and development engineering,
component and qualification testing, and to support tasks described
elsewhere in this SOW.
The Contractor shall provide support to facilities and laboratories
ranging from operation and maintenance to specific technical services
within facilities and laboratories as defined by Work Order. The
Contractor shall provide labor, supplies, material, parts, tools, and
equipment necessary to sustain the general capability intended for the
facilities and laboratories and specific items necessary for particular
experimental or test activities. General housekeeping should be
practiced regularly to maintain assigned areas in an orderly,
professional manner. Periodic calibrations required for test equipment
such as volt meters, torque wrenches, pressure gauges, and other
laboratory standards are performed by the Base Operations Contractor.
The Contractor shall prepare and/or update existing Periodic
Maintenance Instructions (PMIs) describing the type and frequency of
maintenance to be
50
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NAS10-98001 (EDC) Attachment J-1
- --------------------------------------------------------------------------------
performed on each of the components and systems as designated by Work
Order.
The Contractor shall provide technical support for research, design,
and development projects. The Contractor shall assure safe and orderly
facilities, equipment configuration, and operating practices. The
Contractor shall be able to work from preliminary engineering
instructions, sketches, and concept descriptions. Technicians shall be
capable of using standard machines and equipment normally associated
with the disciplines and technologies in each facility and laboratory.
The Contractor shall fabricate concept test models, prototypes and
limited run production models or modifications thereto as directed by
Work Order.
3.5 INFORMATION TECHNOLOGY (I/T) RESOURCES
The Contractor shall acquire, maintain, upgrade, and/or replace I/T
resources and interface with existing Government I/T resources in
accordance with the following NASA Chief Information Officer (CIO)
Executive Notices to the extent indicated.
1. Compatible with the following CIO Executive Notices:
Notice Title
------ -----
02-95 Internet Usage Policy
08-95 Designated Internet Home Page Naming and Ownership
09-95 Network Protocol Standard
01-96 NASA Electronic Mail
02-96 NASA X.500 Directory Standard
20-97 Intranet Functional Requirements
2. Compliant with the following CIO Executive Notices:
Notice Title
------ -----
03-95 Information Technology (IT) Obsolescence Management
06-95 Minimum Office Automation Software Suite Interface
Standards and Product Standards
07-95 Minimum Hardware Configuration
18-97 UNIX Interoperability Standards
19-97 Standard Workstation Management Tools
The Contractor shall provide I/T planning information identified in
Appendix 5 "I/T Planning and Review at KSC, Principles and Goals."
51
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NAS10-98001 (EDC) Attachment J-1
- --------------------------------------------------------------------------------
Items or services acquired under this contract are required to
include accurate processing of the date and date-related data
(including but not limited to calculating, comparing, and sequencing)
by all hardware and software products delivered under this contract,
individually and in combination, upon installation. This also
includes the manipulation of data with dates prior to, through, and
beyond January 1, 2000, and shall be transparent to the use.
Hardware and software products provided under this contract shall,
individually, and in combination, successfully transition into the
Year 2000 with the correct system date, without human intervention,
including leap year calculations. Such products shall also provide
correct results when moving forward or backward in time across the
Year 2000 or subsequent years.
4.0 SAFETY AND MISSION ASSURANCE
Safety and Mission Assurance (S&MA) encompasses the fields of safety,
reliability, maintainability, and quality assurance for the contract.
The Contractor shall develop, provide, and implement an ISO 9001
transition plan implementing ANSI/ASQC Q9001-1994 in accordance with
DRD-012. The transition plan shall meet the intent of ISO 9001 and
shall serve as the control document for the Contractor's Quality
Assurance (QA) program until ISO 9001 compliance (2) is achieved. Upon
reaching compliance, ISO 9001 shall serve as the Contractor's QA
control document. The Contractor shall also incorporate safety-related
requirements, identified in Appendix 4, into appropriate plans,
processes and operations.
The Contractor shall provide the following support, products, and/or
services:
1. Develop, implement, and document approaches to ensure activities
are effective in the mitigation of risk. This includes the
identification of methods by which the Government can measure
Contractor S&MA performance.
2. Support Government audit/surveillance of Contractor plans,
procedures, and processes.
3. Develop, implement and document auditable approaches to achieve
safe operations, including a safety and health plan in accordance
with DRD-011. The document shall detail how the Contractor shall
assure the identification, evaluation, elimination and control of
safety and health concerns.
4. Develop, implement and document the approach to ensure the
identification, elimination, and control of hazards throughout
the complete project life cycle (design, development,
manufacture, test, operations,
- --------------------
(2) Compliance in this instance means that the Contractor's operations meet the
requirements for certification (but has not gone through the formal
certification process) according to a gap analysis performed by a second party
auditor identified by the Contracting Officer.
52
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NAS10-98001 (EDC) Attachment J-1
- --------------------------------------------------------------------------------
maintenance, and disposal) of items or processes for which the
Contractor is responsible. The approach shall include the
processes in which personnel and property shall be protected from
injury or harm as a result of exposure to hazards. The Contractor
shall report and investigate incidents, including remedial and
corrective actions performed in accordance with KHB 1710.2. The
Contractor shall provide summary data on accidents in accordance
with DRD-O08.
5. Develop, implement, and document an auditable approach to
maximize operational availability for Contractor products. This
approach shall include, but not be limited to, such areas as:
assessments of reliability and maintainability performance
against baseline requirements; preparation and implementation of
maintenance and reliability control/ assessment methods such as
Failure Modes and Effects Analysis (FMEA); and assessments of
materials and parts in support of operational integrity.
6. Collect and compile information derived from empirical data (test
results, analysis reports, inspection records, delivery logs,
etc.) to demonstrate products and services delivered to the
Government are in compliance with requirements and
specifications. As a part of this effort, the Contractor shall
establish a system to control and/or improve quality. The
delivery of the compliance information shall be at the request of
the Government.
7. Provide for the identification, reporting, and
elimination/disposition of nonconformance/problems in accordance
with NSTS 08126, and/or SSP 30223 requirements, as appropriate.
The Contractor shall provide real-time access to
nonconformance/problem documentation, data, databases, analyses,
and related information to the Government. The Contractor shall
provide for appropriate Government insight into the disposition
of nonconformance/problems, including notifying the Government of
the occurrence.
8. Develop, implement and document an approach for controlling the
quality of processes, including the control of variability and
stability for repetitive processes that control key product
characteristics. Key characteristics are the features of a
material, part, or process whose variations have an influence on
product fit, service life, or performance, including safety or
reliability.
9. Support program milestones such as design, acceptance, and
readiness reviews. Participate in reviews to assure S&MA
requirements are considered in decisions that affect hardware
design, configuration controls, initiation of subsystem and
integrated testing, and shipment. S&MA data presented shall
contain sufficient detail to allow management to assess the
acceptability to proceed with the next program phase activity.
53
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS LIST
- --------------------------------------------------------------------------------
DRL NUMBER EDC REVISION BASIC
- --------------------------------------------------------------------------------
PROJECT/SYSTEM ENGINEERING DEVELOPMENT CONTRACT
- --------------------------------------------------------------------------------
CONTRACT NUMBER PREPARATION DATE
- --------------------------------------------------------------------------------
CONTRACTOR TECHNICAL APPROVAL
- --------------------------------------------------------------------------------
ATTACHMENT NUMBER EXHIBIT NUMBER
- --------------------------------------------------------------------------------
ITEM TITLE CHANGE STATUS
NO.
- --------------------------------------------------------------------------------
001 Emergency Preparedness Plan
002 Metrics Data Report
003 Contractor Financial Management Report (NASA Form 533 Series)
004 Information Technology (I/T) Reporting
005 Motor Vehicle Utilization Plan
006 Annual Summary of Records Holdings Report
007 Information Technology (I/T) Plans
008 Safety Statistics Report (SSR)
009 Acceptance Data Package (ADP)
010 Management Plan
011 Safety and Health Plan
012 ISO 9001 Transition Plan
013 Security Plan
014 Risk Assessments
015 Work Order Progress Chart
016 Maintenance Plan
017 Maintenance Status Report
018 Work Order Summary Report
019 Automated Information Security Plan
020 Pressure Vessel/System Certification Report
021 Monthly KSC Headcount Report
022 GIDEP Alert System
023 Summary Labor Report
024 Work Order Revision Status Report
025 Technology Transfer Plan
026 Technology Transfer Report
027 Procurement Summary Report
028 Contractor Workforce and Funding Authority Summary Report
029 Contractor Resource Management Summary and Concerns Report
030 Work Plan
031 Equal Employment Opportunity Report
54
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
INSTRUCTIONS FOR COMPLETING CONTRACT APPLICATION INFORMATION
------------------------------------------------------------
A. LINE ITEM #: Sequentially number line items beginning with number 001.
B. LINE ITEM TITLE: Enter the title of the data item as shown in the
Statement of Work (SOW), the RFP, and/or as directed by the CTM.
C. OPR (Office of Primary Responsibility): Enter the organization designated
to exercise technical and/or administrative control over the data
requirement. Use approved organizational code.
D. TYPE: Enter "Type of Data" code as follows:
CODE DESCRIPTION
---- -----------
1 Data requiring written approval by the procuring activity prior to
implementation into the procurement or development program.
2 Data submitted to the procuring activity for review not later than 3
weeks prior to project implementation. Data shall be considered
approved unless the contractor has been notified of disapproval
prior to project implementation.
3 Data submitted to the procuring activity for coordination,
surveillance, or information.
4 Data retained by the contractor to be made available to the
procuring activity upon request. The contractor shall furnish a list
to the procuring activity.
5 Data to be retained by the contractor and reviewed by NASA on
request.
<TABLE>
<CAPTION>
<S> <C> <C>
E. INSPECT/ACCEPT: Enter Inspection Acceptance code as follows:
CODE INSPECTION ACCEPTANCE CODE INSPECTION ACCEPTANCE
---- ---------- ---------- ---- ---------- ----------
1 Source Source 4 Certificate of Conformance (Mandatory)
2 Destination (OPR) Destination (OPR) 5 Certificate of Conformance (Optional)
3 Source Destination (OPR) 6 No Inspection Required No Acceptance Reqd
F. FREQUENCY OF SUBMISSION: Enter the frequency of submission code as follows:
CODE DESCRIPTION CODE DESCRIPTION CODE DESCRIPTION
---- ----------- ---- ----------- ---- -----------
AD As Directed PC Per Contract PV Per Vehicle
AN Annual PD Per Failure QU Quarterly
AR As Required PE Per Event RD As Released
BE Biennial PF Per Facility RT One Time & Revisions
BM Bimonthly (every 2 months) PG Per Program SA Semi-Annually
BW Biweekly (every 2 weeks) PI Per Equipment End Item SM Semi-Monthly
DA Daily PJ Per Project TY Three-Year Period
DD Deferred Delivery PL Per Launch Flight Mission UR Upon Request
MO Monthly PS Per System WK Weekly
OT One Time PT Per Test
</TABLE>
G. INITIAL SUBMITTAL: Enter date of initial submittal as follows: Month, Day,
Year. If calendar date is not scheduled, enter number of days preceding or
following event to which the data requirement is related, e.g., 90 days
prior to launch. Amplify in REMARKS (Item J) if necessary.
H. AS OF DATE: For "Onetime Only" submittals, enter date by month, day, year.
For recurring submittals, enter number coding, e.g., 30/10, 90/10, 15/5,
etc. The first digit(s) indicate the number of calendar days from the
reporting period's (block F) start to the data preparation cutoff. The
second digit(s) after the slash indicates the number of calendar days from
the cutoff to the submittal date. Example: if block F were "MO" and block H
were "30/10", the data would include the entire month and would be
submitted within 10 days thereafter.
J. REMARKS: Enter in this space: (a) minor exceptions to the DRD; (b)
stipulation of specific forms when multiple forms are authorized on the
DRD; (c) the paragraph, page, etc. in an existing contract where the data
requirement is specified (this data may be removed at final approval); (d)
additional submittal information if necessary.
K. DISTRIBUTION: Enter organizational symbol, number of copies, and type of
copy code(s) in parenthesis required for each office. Type of copy codes
are as follows: (A) Regular; (B) Reproducible; (C) Microfilm, Aperture
Cards; (D) Others (explain in remarks - item J). Example of entries:
IS-PRO-1 (1A)=one regular copy; lS-PRO-3 (5A, 1B)=five regular copies, one
reproducible copy. Enter the total number of copies by type in the space
provided.
-------------------------------------------------------------
INSTRUCTIONS FOR COMPLETING DATA REQUIREMENT DESCRIPTION
--------------------------------------------------------
GENERAL: The Data Requirement Description (DRD) will be prepared to describe the
content and provide preparation information for data required in support of NASA
programs.
1. TITLE: Enter the title or type of document required. The first word of the
title should be a principal noun which best establishes the basic concept
of the data. Subsequent words should be appropriate modifiers. For example:
Plan, Project Development (SIVB); Report. Quarterly Progress; Proposal,
Engineering Change (ECP).
2. NUMBER: Enter the appropriate number assigned to the DRD. This number will
identify the appropriate data category.
3. USE: Enter a synopsis of the use of the document stating reason for the
requirement.
4. DATE: Enter date of preparation.
5. ORGANIZATION: Identify the installation preparing the DRD.
6. REFERENCE5: List applicable documents by number (NASA Mgt Manual, etc.) to
which the preparing office (e.g., NASA installations, etc.) may refer for
additional information concerning the data requirement.
7. INTERRELATIONSHIP: Enter all affected approved DRDs within the scope of the
program when the DRD under preparation creates a significant impact or
interface relationship with existing DRDs. Include a brief narrative of the
impact or relationship created and a statement that the new DRD does not
cause a conflict with other DRDs.
8. PREPARATION INFORMATION: Provide ample information for preparation of the
data required by the data requirements description. Include all necessary
details of preparation to satisfy the originator's formal requirements.
NOTE: This is an electronic facsimile and is not an exact duplicate of the
original form.
55
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 001
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Emergency Preparedness Plan
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
IM.-SPS 1 2 RT See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
The Emergency Preparedness Plan shall be submitted for approval by the
Contracting Officer within 60 days after contract start.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Emergency Preparedness Plan
- --------------------------------------------------------------------------------
3. USE 4. DATE
To provide the method for the establishment,
development, and maintenance of the effective 5. ORGANIZATION
capability to cope with emergencies or disasters KSC
as identified in KHB 1040.1F w/ch.1.
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
See Block 8
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
Prepare and maintain a current Emergency Preparedness Plan for the protection of
personnel and facilities in the assigned areas of operation.
A. The Plan shall provide:
1. Emergency plans and procedures (including hurricanes);
2. Methods to be used for indoctrination and training of Contractor and
support personnel for optimum emergency readiness.
3. Procedures for prompt return of systems to full operational condition
following an emergency.
4. Effective emergency operational performance.
5. Description of how the Plans will be implemented.
6. Identification of a Hurricane Coordinator.
B. The format of the Plan shall be similar to that in KHB 1040.1F w/ch.l.
- ------------------------------
Block 6 References:
NMI 1040.3C
KHB 1040.1F w/ch.1
56
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 002
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Metrics Data Report
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-PCO 1 2 QU/AD See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
The initial report submittal shall be after the first quarter or as designated
in a WO or TD.
* Block K - Code D: Data to be provided on electronic medium. The CTM will
determine the type and quantity.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Metrics Data Report
- --------------------------------------------------------------------------------
3. USE 4. DATE
To report the Contractor's Metrics Data to NASA
for evaluation. 5. ORGANIZATION
KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
As directed, provide metric data to the Technical Representative of the
applicable Work Order or Technical Directive requiring the metric.
At the end of each quarter, prepare a summary report of all metric data required
by the contract, specifically those metrics called out in Work Orders and
Technical Directives.
Data should be presented in chart form where practicable, and should indicate
any available trend history from all previous reporting periods. Each chart
shall include the title, WO number, and Technical Contact of the applicable Work
Order.
57
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 5
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 003
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Contractor Financial Management Report (NASA Form 533 Series)
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
GC-C1-C 3 6 MO/QU See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
Initial submission of NASA Form 533M and 533Q reports shall begin with the first
monthly report after contract start.
* Block K - Code D: Data to be provided on electronic medium. The CTM will
determine the type and quantity.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
NASA Contractor Financial Management Report
(Monthly - NASA Form 533M) (Quarterly - NASA Form 533Q)
- --------------------------------------------------------------------------------
3. USE 4. DATE
To provide financial management cost and financial
planning data for ensuring that Contractor operations
are efficiently planned and supported by dollar and
labor resources. 5. ORGANIZATION
KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
DRD-015,DED-018 See Block 8
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
Block 6. References: NPD 9501.1F
NPG 9501.2C
- ---------------------------
Block 8. Preparation Information:
A. Prepare NASA Forms 533M & 533Q per instructions referenced above
(NPG 9501.2C). Refer to sample 533 reporting format for desired report
periods and cost elements to be presented. In addition, the contractor will
be required to report hours and costs for both actual and planned elements
for the fiscal year to date.
B. An initial NF533Q report shall be submitted within 30 working days after
authorization to proceed has been granted. This initial report shall reflect
the original contract value detailed by negotiated reporting categories and
shall be the original contract baseline plan. Subsequent NF533Q reports are
due not later than the 15th day of the month preceding the quarter being
reported (e.g. the report for the quarter beginning July 1 is due not later
than June 15). Additional negotiated amounts, if any, shall be identified in
like manner within 30 days of the conclusion of negotiations. An addendum
shall be included with each NF533Q which will provide details of Payroll
Additives and Fringe Benefits, as described in paragraph "P.".
C. NF533M reporting must begin not later than 30 days after incurrence of cost.
Subsequent NF533M reports shall be furnished not later than 10 working days
following the close of the Contractor's monthly accounting period.
D. In no case will the NF533M & NF533Q reports arrive later than the 15th
calendar day of the appropriate month.
(See continuation sheet)
58
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
1. DOCUMENT NO(s) 2.
DRD-003 KENNEDY SPACE CENTER Page 2 of 5
DOCUMENT CONTINUATION SHEET -------------------------
3. OFFICE
- --------------------------------------------------------------------------------
4. DOCUMENT 5. DATE
Contractor Financial Management Report
(NASA Form 533 Series)
- --------------------------------------------------------------------------------
6.
Block 8. Preparation Information Continued:
E. The Contractor shall additionally provide data, exclusive of narrative
remarks, on electronic medium. The Contractor and NASA will jointly
pursue the use of available technologies and transmission capabilities
to facilitate electronic reporting, and will endeavor to provide
electronic reporting earlier than the standard due dates.
F. The Contractor shall furnish with the initial NF533Q, the Contractor's
accounting calendar which lists the accounting periods, number of work
days included in each period, and all holidays. All subsequent
revisions shall be provided at the time of the change. At a minimum,
an updated accounting calendar will be provided at the beginning of
each government fiscal year.
G. Data elements listed in this DRD will be reported under the following
categories:
1. Total Contract Summary
----------------------
2. Indirect Cost Summary (Management & Administrative)
--------------------------------------------------
3. Work Order Summary by Appropriation. Numbers and Nomenclature
-------------------------------------------------------------
a. Program Summaries
b. Work Order Detail Summaries
c. Closed Work Order List
d. Summary of Closed Work Orders
4. Work Order Numbers and Titles
-----------------------------
H. Contractors are required to indicate full incurred costs on the NF533
Report. At the end of each fiscal year, upon submittal of final
indirect cost rates, provisional billing rates shall be changed to the
proposed final rates. The Contractor shall include all adjustments in
the current month actual costs column on the NF533M, itemizing
adjustments in an addendum to the NF533M.
I. Cost figures will be reported to the nearest whole dollar, and
equivalent headcount will be reported to the nearest tenth. Hours will
be reported to the nearest whole hour.
J. Subcontractors, if applicable, will provide 533 reports to the prime
Contractor in the same format as required by this DRD for the
applicable data elements and categories. Copies of the subcontractor's
533 reports will be submitted with the prime contractor's 533 reports.
K. Indirect costs (such as management and administrative costs and
Non-Work Order related ODC) shall be allocated to the applicable Work
Orders based on acceptable accounting practices and statistical
techniques. A complete breakdown of all elements of indirect cost and
allocation methods will be required. Specific percentages and
distributions must be approved by NASA prior to implementation.
L. Each NF533M shall contain a next month estimate for all anticipated
hours and costs.
M. The Contractor shall provide with the NF533M, a variance analysis by
amount and percent for each element of cost, of the difference between
the estimate for the month (made in the previous month) and the actual
for the month being reported in the current NF533M. This variance
analysis will be required for the Contract Summary, as well as for
each Appropriation Summary. In addition, the Contractor shall provide
a narrative summary of each data element and explain the reason(s) for
the variance.
(See continuation sheet)
59
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
1. DOCUMENT NO(s) 2.
DRD-003 KENNEDY SPACE CENTER Page 3 of 5
DOCUMENT CONTINUATION SHEET -------------------------
3. OFFICE
- --------------------------------------------------------------------------------
4. DOCUMENT 5. DATE
Contractor Financial Management Report
(NASA Form 533 Series)
- --------------------------------------------------------------------------------
6.
Block 8. Preparation Information Continued:
N. For any indirect rates (such as overhead, G&A, etc.) charged to the
contract, the Contractor is to identify in the narrative to the NF533M
the provisional billing rates, ceiling rates and cumulative actual
rates for the contract.
0. Data elements to be reported should include the following:
CONTRACTOR FINANCIAL MANAGEMENT REPORTS - NASA FORMS 533M & 533Q
DATA ELEMENTS
DIRECT LABOR (ENGINEERING, ENGINEERING SUPPORT, FACILITY AND LABORATORY
SUPPORT) HOURS
------------------------------------------------------------------------
Straight Time Productive Hours
Overtime Productive Hours
Overtime Productive Hours Not Paid
Subcontract Productive Hours
Subtotal Productive Hours
Non-Productive Hours
TOTAL DIRECT HOURS
INDIRECT LABOR (MANAGEMENT AND ADMINISTRATIVE LABOR) HOURS
----------------------------------------------------------
Straight Time Productive Hours
Overtime Productive Hours
Overtime Productive Hours Not Paid
Subcontract Productive Hours
Subtotal Productive Hours
Non-Productive Hours
TOTAL INDIRECT HOURS
TOTAL DIRECT & INDIRECT LABOR HOURS
DIRECT LABOR (ENGINEERING. ENGINEERING SUPPORT. FACILITY AND LABORATORY
SUPPORT LABOR) COST
------------------------------------------------------------------------
Straight Time Productive Cost
Overtime Productive Cost
Subtotal Direct Productive Cost
Non-Productive Cost
Fringe Benefits/Payroll Adds
Subtotal Non-Productive
TOTAL DIRECT LABOR COST
(See continuation sheet)
60
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
1. DOCUMENT NO(s) 2.
DRD-003 KENNEDY SPACE CENTER Page 4 of 5
DOCUMENT CONTINUATION SHEET -------------------------
3. OFFICE
- --------------------------------------------------------------------------------
4. DOCUMENT 5. DATE
Contractor Financial Management Report
(NASA Form 533 Series)
- --------------------------------------------------------------------------------
6. Block 8. Preparation Information Continued:
INDIRECT LABOR (MANAGEMENT AND ADMINISTRATIVE LABOR) COST
---------------------------------------------------------
Straight Time Productive Cost
Overtime Productive Cost
Subtotal Indirect Productive Cost
Non-Productive Cost
Fringe Benefits/Payroll Adds
Subtotal Non-Productive
TOTAL INDIRECT LABOR COST
TOTAL DIRECT & INDIRECT LABOR COST
OTHER DIRECT COSTS (Subgrouped by Work Order and Non-Work Order Related):
-------------------------------------------------------------------------
Subcontracts
Material/Equipment-current year
Material/Equipment-prior year
Maintenance-current year
Maintenance-prior year
Motor Vehicle Expense
Training
Travel
Relocation
Recruitment
Other ODC (detail elements in NF533M narrative)
TOTAL OTHER DIRECT COST
TOTAL COST BEFORE G&A
G&A
---
COST OF FACILITIES CAPITAL
--------------------------
TOTAL COST
----------
AWARD FEE
---------
Fee Earned
Interim Fee
Provisional Fee
Potential Additional Fee
TOTAL AWARD FEE
TOTAL CONTRACT COST AND FEE
---------------------------
MANAGEMENT INFORMATION ITEMS
Prompt Payment Discounts
Unfilled Orders
Termination Liability
Equivalent Direct Headcount
Equivalent Indirect Headcount
Equivalent Population
Equivalent Overtime Headcount
Overtime Rate Percent
Equivalent Subcontractor Headcount
Contract Total Physical (Actual) Headcount
(See continuation sheet)
61
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
1. DOCUMENT NO(s) 2.
DRD-003 KENNEDY SPACE CENTER Page 5 of 5
DOCUMENT CONTINUATION SHEET -------------------------
3. OFFICE
- --------------------------------------------------------------------------------
4. DOCUMENT 5. DATE
Contractor Financial Management Report
(NASA Form 533 Series)
- --------------------------------------------------------------------------------
6. Block 8. Preparation Information Continued:
P. An analysis of Payroll Additives & Fringe Benefits (PA&FB) shall be
included with each NF533Q. The analysis will detail all elements that
make up the PA&FB category and list the Fiscal Year to Date Cost for
each element, and provide an estimate for the balance of the Fiscal
Year, by quarter. The associated labor cost will also be included, and
the Fringe Benefit Rate will be calculated as a percent of labor cost.
The applicable bases, and rates for the individual elements will be
provided. Variances from planned rates, and variances between quarters
will be explained.
Q. SELECTED DATA ELEMENT DEFINITIONS Elements of cost are defined in
general in NPG 9501.2C. This Center feels that additional explanations
are necessary for the items listed below, in order to ensure clarity.
1. Straight Time Hours - Those non-premium hours exclusive of
non-productive hours which are worked by direct labor personnel.
2. Overtime Hours - Those premium hours worked by direct labor
personnel.
3. Non-Productive Hours - Those hours used for vacation, sick leave,
holiday, and other non-work periods. This only includes those
hours for which the employees are paid.
4. Equivalent Direct Headcount - The average number of personnel
directly performing a specific task or contract (does not include
indirect personnel), for a given length of time, and is usually
expressed as a monthly average. It is further defined as:
<TABLE>
<CAPTION>
<S> <C>
Direct Headcount = Straight Time Direct Hours + Non-Productive Hours for Direct Employee
-------------------------------------------------------------------------
8 x (number of Operating Days and Holidays)
</TABLE>
5. Equivalent Indirect Headcount - The average number of indirect
(Management & Administrative) personnel. Population less direct
headcount.
6. Equivalent Population - The average number of contractor
personnel located at KSC during the month. The total of Direct
and Indirect Headcount. It is further defined as:
Straight Time Direct Hours + Non-Productive Hours + Indirect Hours (M&A)
-----------------------------------------------------------------------
8 x (number of Operating Days and Holidays)
7. Equivalent Overtime Headcount -
-------------------------------
Equivalent Overtime Headcount = Total Paid Overtime Hours Expended
-----------------------------------------
8 x (number of Operating Days & Holidays)
8. Overtime Rate Percent -
-----------------------
Overtime Rate = Overtime Hours Expended
------------------------------------
Straight Time Hours + Non-Productive
62
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 004
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Information Technology (I/T) Reporting
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE IRM Rep. 3 6 SA/AD See Block J
- --------------------------------------------------------------------------------
J. REMARKS
Initial submittal 6 months after contract start unless otherwise directed.
* Block K - Code D: Data to be provided on electronic medium. The CTM will
determine the type and quantity.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Information Technology (I/T) Reporting
- --------------------------------------------------------------------------------
3. USE 4. DATE
To provide NASA with I/T reporting data necessary for
oversight. 5. ORGANIZATION
KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
List separately by Work Order and cumulative total for the contract all
associated Information Technology (I/T) resources which includes workforce
labor, hardware and software for both Commercial-Off-The-Shelf (COTS) and
developed items. Costs and labor shall be accumulated for work activity or
purchases which are expended in I/T activities (this does not include activities
which may utilize I/T resources as a tool but are not I/T activities; e.g.,
conducting a test which may use I/T tools but there is no I/T design,
development or purchase required).
Provide cumulative actuals for the contract segregated into the following
categories:
1. COTS:
a) Purchased hardware cost
b) Purchased software cost
2. Design/Development/Integration-related:
a) I/T workforce cost for hardware items
b) I/T workforce labor hours for hardware items
c) I/T workforce cost for software items
d) I/T workforce labor hours for software items
63
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 005
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Motor Vehicle Utilization Plan
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-ADM 3 6 See Block J See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
The initial plan shall be submitted 30 days after the contract start. The plan
shall be updated every 6 months covering all changes necessary including a 12
month vehicle forecast which must allow 6 months advance notice of increased
requirements.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Motor Vehicle Utilization Plan
- --------------------------------------------------------------------------------
3. USE 4. DATE
The plan shall provide for the method of aquisition
and management of motor vehicles needed to properly 5. ORGANIZATION
perform the requirements of the contract. KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
See Block 8
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
The Motor Vehicle Utilization Plan shall fully describe the Contractor's
methodology in acquiring motor vehicles demonstrating that the most efficient
and cost effective techniques are employed. The Plan shall also fully describe
the management techniques which assure that the proper number of vehicles are
continuously justified, that operators are fully aware of "official use only"
restrictions, and are properly licensed. Operator discipline for improper use of
vehicles shall be described. The Plan shall also contain a 12 month vehicle
requirements forecast which must be updated every 6 months.
- --------------------------
Block 6 References:
KHB 6000.1C
KHB 1610.1
64
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 006
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Annual Summary Of Records Holdings Report
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-ADM 3 2 AN See Block J 360/10
- --------------------------------------------------------------------------------
J. REMARKS
The initial report shall be submitted 30 days after the contract start.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Annual Summary Of Records Holdings Report
- --------------------------------------------------------------------------------
3. USE 4. DATE
To provide the KSC Records Management Officer with an
annual count of NASA-owned, Contractor-held records 5. ORGANIZATION
on hand and the volume of records destroyed during the KSC
year.
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
See Block 8
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
A. The report is submitted on Standard Form 136, "Annual Summary of Records
Holdings." The forms and current submittal information will be provided by
the OPR (Office of Primary Responsibility).
B. Examples of information requested include:
1. Volume of records on hand (in cubic feet) at the beginning and end of
the reporting period. The reporting period is from October 1 to
September 30 of the subsequent year.
2. Volume of records destroyed during the reporting period.
3. Number of reels of magnetic tape on hand.
4. Volume of audio visual records destroyed during the reporting period
(includes still pictures, motion pictures, sound recordings and video
recordings).
5. An explanation of significant increases or decreases in volume of
records, holding, or any other significant records disposition
matters, such as, the volume of "non-record material" on hand at the
beginning and end of each reporting period.
- --------------------------
Block 6 References:
KMI 1440.1F
NPG 1441.lC
65
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 007
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Information Technology (I/T) Plans
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DL-DSD 1 6 See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
Block F: Yearly as required for Level A plan with updates as necessary.
Initially and as required for updates for Level B plan.
Block G: Within 45 days after contract start.
* Block K - Code D: Data to be provided on electronic medium. DL-DSD will
determine the type and quantity.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Information Technology (I/T) Plan
- --------------------------------------------------------------------------------
3. USE 4. DATE
To document Contractor Information Technology
requirements for NASA approval and reporting to other 5. ORGANIZATION
government activities. KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
See Block 8
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
Prepare Level A and Level B Information Technology Plans and submit to the DE
Information Resources Manager (IRM) Representative as required to maintain
current information on (I/T) requirements and changes thereto. Section J,
Attachment J-1, Appendix 5 contains the NASA KSC Chief Information Officer (CIO)
direction currently in use pending NASA agency directives.
66
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 008
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Safety Statistics Report (SSR)
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-PCO 3 6 See Block J See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
Block F: Monthly, on or before the 10th of each month, for the previous month.
Block G: By the 10th of the second month after contract start.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Safety Statistics Report (SSR)
- --------------------------------------------------------------------------------
3. USE 4. DATE
To provide information on the accidents affecting
the Contractor's performance. 5. ORGANIZATION
KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
KHB 1710.2C, Annex B
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
The Safety Statistics Report (SSR) provides information on accidents affecting
the Contractor's performance. The SSR shall contain the following monthly
information (Contractor format):
1. Number of labor hours worked.
2. Number of new lost-time injury cases.
3. Number of lost-time days for the month (including previous month's cases).
4. Number of medical treatment cases.
5. Number of first aid cases.
6. Number of miles driven in Government-provided vehicles.
7. Number of vehicle accidents with damage greater than $1000.
8. Total damage cost due to motor vehicle accidents (including accidents with
less than $1000 damage).
9. Number of accidents which resulted in NASA property damage greater than
$1000.
10. Total damage cost to NASA property as a result of accidents (including
accidents with less than $1000 damage).
67
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 009
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Acceptance Data Package (ADP)
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
EY 4 See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
Block F: Submitted with shipment/transfer of each applicable hardware item or
software delivery.
Block G: As required on Work Order or Technical Directive (TD) with delivery of
hardware or software from DE to a customer.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Acceptance Data Package (ADP)
- --------------------------------------------------------------------------------
3. USE 4. DATE
The ADP is an accumulation of documentation that
provides a verified, complete and current status
of deliverable hardware/software as required on the 5. ORGANIZATION
WO or TD. KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
See Block 8
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
The ADP shall be prepared using KHB 5310.1C, Change 5 as a guideline or, for
Space Station Program items, in accordance with SSP 30695 (Contractor format is
acceptable).
68
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 010
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Management Plan
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-PCO 1 2 RT/AD See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
The plan shall be submitted within 15 days after contract start and must be
approved by the Contacting Officer. Subsequent submissions or updates will be
submitted per the request of the OPR.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Management Plan
- --------------------------------------------------------------------------------
3. USE 4. DATE
The document shall detail the Contractor approach to 5. ORGANIZATION
implementing the detailed management activities. KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
The Management Plan shall include sufficient information to address the
Contractor's approach to organization, planning, scheduling, implementing,
staffing, subcontracting, application of Continuous Improvement principles, risk
management and all SOW activities. The Plan shall also address how the
Contractor will interface with the multiple government and contractor
organizations which will be required.
The plan shall incorporate the major aspects of the Contractor's proposal as
modified through the Best and Final Offer.
69
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 2
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 011
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Safety and Health Plan
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
EI 1 N/A See Block J
- --------------------------------------------------------------------------------
J. REMARKS
Block G: A preliminary Safety and Health Plan shall be submitted within two
weeks after the contract start with the final plan submittal for approval within
90 days after the contract start.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Safety and Health Plan
- --------------------------------------------------------------------------------
3. USE 4. DATE
To describe the Contractor's safety and health plan 5. ORGANIZATION
for each work area. KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
KHB 1710.2C, Annex B
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
1. SCOPE: Applicable to all NASA centers and sites where the Contractor is
operational.
2. APPLICABLE DOCUMENTS:
--------------------
NHB 5300.4 (1D-2) Safety, Reliability, Maintainability and Quality
Provisions for the Space Shuttle Program, as modified
by this SOW
NHB 1700.1 (VI)-B NASA Safety Policy and Requirements Document
CFR 1910 Department of Labor, Occupational Safety and Health
Standards
3. CONTENTS: The plan shall describe tasks and activities of safety and health
management at each work area where the contractor is operational to assure
the identification, evaluation and elimination/control of safety and health
concerns. The plan shall include the following:
a) Organization chart(s) which illustrate the functional relationships and
lines of communication between Safety, Health and other organizational
elements.
b) Descriptions of the Safety and Health management function within the
organization including the process through which management decisions will
be made, including notification of the local NASA Safety and Health
organization of critical and catastrophic hazards, corrective actions,
mishaps and deviations or waivers to NASA Safety and Health requirements.
c) Description of the responsibility, authority, and accountability of Safety
and Health personnel, other Contractor organizational elements involved in
the safety and health effort and subcontractor safety and health personnel.
Include the organizational unit responsible for the execution of safety and
health tasks and the position with the authority to resolve all identified
safety and health issues.
(See continuation sheet)
70
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
1. DOCUMENT NO(s) 2.
DRD-011 KENNEDY SPACE CENTER Page 2 of 2
DOCUMENT CONTINUATION SHEET -------------------------
3. OFFICE
- --------------------------------------------------------------------------------
4. DOCUMENT 5. DATE
Safety and Health Plan
- --------------------------------------------------------------------------------
6. Block 8. Preparation Information Continued:
3. CONTENTS: (cont.)
d) Description of the management controls that will be used to ensure
compliance with safety and health regulations.
e) Cross-reference of safety program requirements (e.g., OSHA, NASA, KSC)
and Contractor procedures to avoid duplication of effort.
f) Description of the safety program measurement system, including
measurements, metrics, and trend analysis methods. The performance
measurement system should describe responsibility for identifying and
implementing remedial action, recurrence control, and corrective
actions that are necessary to control and/or improve performance as
indicated by the performance measurement system.
4. ELEMENTS TO BE CONSIDERED IN THE PLAN:
a) Training
b) Certification
c) Inspections and audits
d) Control of unsafe conditions
e) Design, construction, and activation of facilities
f) Operation and maintenance of facilities
g) Fire prevention and protection
h) Handling and storage of hazardous materials
i) Transportation
j) Hazards to the public and employees, such as pollution and waste
disposal, radiation, pesticides, noise and vibration, and explosion
k) Accident/Mishap investigation, reporting, and tracking
l) Hazardous operations
m) Personnel protective equipment
n) Contingencies, emergencies, and disasters
o) Subcontractor industrial safety requirements and the methods employed
to insure compliance
5. FORMAT: Contractor format is acceptable.
6. MAINTENANCE: Changes shall be incorporated as required by change page or
complete re-issue.
71
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- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 012
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE
ISO 9001 Transaction Plan
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-PCO 1 2 RT/AD See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
A preliminary Plan shall be submitted for approval within thirty days after
contract start. The final plan shall be submitted for approval within 90 days
after contract start.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
ISO 9001 Transaction Plan
- --------------------------------------------------------------------------------
3. USE 4. DATE
To serve as the master planning and control document
for the Contractor's Safety & Mission Assurance program 5. ORGANIZATION
until successful ISO 9001 Compliance. KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
ISO 9001
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
The ISO 9001 Transition Plan shall meet the intent of ANSI/ASQC 150 9001 and
shall serve as the control document for the Contractor's Quality Assurance (QA)
program until successful ISO compliance is achieved for this contract.
The plan shall describe the Contractor's management approach for QA activities
including elements related to the successful transition to IS0 9001 compliance.
The plan shall include milestone metrics which will be used to assess the
Contractor's progress toward compliance and shall be provided in a format that
readily identifies the Contractor's QA program and those specific requirements
imposed by the contract. The plan shall be capable of being audited by the
Government.
The plan shall show the relationship of the individual managing the QA Program
with each group performing QA program tasks including his authority to control
and monitor the cited tasks.
As an attachment to the plan, the Contractor shall list the implementing ISO
quality procedures by subject, cross referenced to the paragraph(s) of the plan,
number and revision date. The "index" or listing shall become part of the plan
and require periodic updating.
The initial plan submission shall incorporate all changes to the proposal draft
plan through Best and Final Offers and, when approved, will be used as the
control document for the Contractor's QA program until approval of the final
plan submission.
The final plan submission shall incorporate all changes to the initial plan
necessary for the transition of DE labs for which the Contractor has
responsibility for ISO compliance. When approved, the final plan will be used as
the control document for the Contractor's QA program until ISO compliance is
complete at which time IS0 9001 will be used as the control document.
72
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 013
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Security Plan
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
IM-SPS 1 2 RT-AD See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
A preliminary Plan shall be submitted two weeks after the contract start and a
final plan shall be submitted for approval within 90 days of the contract start.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Security Plan
- --------------------------------------------------------------------------------
3. USE 4. DATE
Document shall detail Contractor approach to 5. ORGANIZATION
implementing NASA KSC security policies and directives. KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
See Block 8
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
The Contractor Security Plan shall address the Contractor approach to
implementing KSC policy and directive documents. Additionally, other Contractor
security initiatives and innovative operating approaches or procedures shall be
included. The basic plan shall be unclassified. Any KSC referenced documents
that would be included in the basic Contractor Security Plan whose inclusion
would be classified should be addressed as a separate appendix appropriately
classified.
- -------------------------
Block 6. References:
KHB 1610.1A
KHB 1610.2A
73
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- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 014
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Risk Assessments
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-PCO 3 6 AR See Block J
- --------------------------------------------------------------------------------
J. REMARKS
Block G: Separate report for each program risk, when identified.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Risk Assessments
- --------------------------------------------------------------------------------
3. USE 4. DATE
To provide NASA with a formal risk assessment
of the Contractor responsible portions of design and 5. ORGANIZATION
test activities with each topic and issue presented KSC
to the CTM for resolution/approval.
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
The Risk Assessment provides a formal means to identify, assess, and mitigate
risks associated with technical, schedule, mission success and cost. A risk
assessment including analytical methods, qualitative and/or quantitative as
appropriate will be developed and delivered when a program risk is identified or
increases.
The assessment should include:
a. Identification of the primary risk drivers.
b. Qualitative and/or quantitative assessment of the risk including
probability/likelihood of occurrence and consequences (i.e., increase,
decrease or no change to present risk posture).
c. Option for mitigating the risk including a recommendation.
d. Impacts to baselined risk controls
Contractor format is acceptable.
74
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 2
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 015
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Work Order Progress Chart
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-PCO 3 J MO See Block J
- --------------------------------------------------------------------------------
J. REMARKS
Initial submittal shall be 30 days after contract start. The progress charts
shall be capable of being sorted according to the responsible organization and
UPN.
* Block K - Code D: Data to be provided on electronic medium. The CTM will
determine the type and quantity.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Work Order Progress Chart
- --------------------------------------------------------------------------------
3. USE 4. DATE
To provide Technical Contacts with detailed progress 5. ORGANIZATION
of the work being performed on each Work Order KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
DRD-003
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
A. The Progress Chart shall consist of narrative descriptions, tabular data and
a schedule.
B. Contents of the report shall include, but not be limited to, the following
information:
1. Identity of work by Government Work Order Number.
2. Work Order Title.
3. Project Control Number (PCN, if applicable).
4. Unique Program Number (UPN).
5. Identity of NASA Technical Representative, the NASA Technical Contact
and their respective mail codes.
6. Identity of the Contractor Interface and mail code.
7. Identity of the NASA Project Engineer and mail code.
8. Authorized straight and overtime productive hours.
9. Actual straight and overtime productive hours expended this period.
10. Actual straight and overtime productive hours expended to date for the
current contract period.
11. Contractor's estimated straight and overtime productive hours required
to complete the Work Order.
12. Authorized cost of materials and incidentals (other than travel and
training).
13. Actual materials and incidentals expenditures this period.
14. Actual materials and incidentals expenditures to date for the current
contract period.
15. Actual travel and training expenditures this period.
16. Actual travel and training expenditures to date for the current
contract period.
(See continuation sheet)
75
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
1. DOCUMENT NO(s) 2.
DRD-015 KENNEDY SPACE CENTER Page 2 of 2
DOCUMENT CONTINUATION SHEET -------------------------
3. OFFICE
- --------------------------------------------------------------------------------
4. DOCUMENT 5. DATE
Work Order Progress Chart
- --------------------------------------------------------------------------------
6. Block 8. Preparation Information Continued:
17. Contractor's estimated cost of materials and incidentals required to
complete the Work Order.
18. Authorized total resources ($).
19. Actual total resources ($) expended this period.
20. Actual total resources ($) expended to date for the current contract
period.
21. Contractor's estimated total resources ($) required to complete the
Work Order.
22. Government required completion date.
23. Contractor's estimated completion date.
24. A bar chart schedule depicting the order in which the Contractor plans
to accomplish all of the work described by the Work Order. The
schedule shall contain major activities such as:
Design, drawing preparation, drawing submittals, purchase order
release, subcontract efforts, material and component deliveries,
assembly, submittal of test plans/test procedures/test reports,
testing, hardware refurbishment, and preparation for shipment.
The Contractor shall indicate the percent of the activity to be
accomplished in each period for activities that are not contained in a
single reporting period.
Each activity bar shall have start and stop dates.
Each update of the Work Order Progress Chart shall show both the
original schedule and the actual schedule.
Each update shall show the effective date of the change.
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- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 016
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Maintenance Plan
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-PCO 1 2 RT/AD See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
The Maintenance Plan requires approval by the Contracting Officer. The
preliminary Maintenance Plan shall be submitted within 30 days after contract
start and the final plan submitted for approval within 90 days after contract
start.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Maintenance Plan
- --------------------------------------------------------------------------------
3. USE 4. DATE
The Plan shall detail the Contractor approach to 5. ORGANIZATION
implementing a complete and thorough maintenance KSC
program.
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
DRD-017
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
The Maintenance Plan shall include sufficient information so as to address the
approach to implementing a complete and thorough maintenance program for
assigned facilities, laboratories, systems, and equipment. The plan shall
address allocation of Contractor manpower to accomplish maintenance
documentation updates and actual performance of maintenance tasks. The plan
shall also include the Contractor's approach to the integration of maintenance
tasks with other ongoing work activities. Timetables for completing the
documentation updates and implementing a maintenance program are to be included
in the plan.
77
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 017
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Maintenance Status Report
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-PCO 3 6 QU See Block J 90/15
- --------------------------------------------------------------------------------
J. REMARKS
The initial report shall be submitted in the first quarter after contract start.
* Block K - Code D: Data to be provided on electronic medium. The CTM will
determine the type and quantity.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Maintenance Status Report
- --------------------------------------------------------------------------------
3. USE 4. DATE
To provide visibility and status of the Contractor's 5. ORGANIZATION
maintenance activities. KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
DRD-015 and DRD-016
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
The Maintenance Status Report shall include, but not be limited to, the
following information as required by Work Order:
1. Identity of work by Government/Contractor Work Order number.
2. Work Order title.
3. Identity of NASA Technical Contact.
4. Description of maintenance activities performed the quarter.
5. Facilities/laboratories/systems/equipment affected.
6. Actual labor hours expended on maintenance the quarter.
7. Actual labor hours expended on maintenance to date.
8. Estimated labor hours to be expended on maintenance next quarter.
9. Actual material/supplies expenditures.
10. Remarks column.
11. Schedule of planned maintenance projected for next 12 months.
12. Summary of Periodic Maintenance Instructions (PMIs) completed within the
quarter.
13. Summary of PMIs planned within the quarter.
78
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 018
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Work Order Summary Report
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-PCO 3 6 AN See Block J
- --------------------------------------------------------------------------------
J. REMARKS
The report shall be submitted 30 days after the end of the contract period. The
data provided by this summary report shall be capable of being sorted by UPN and
Work Order number.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Work Order Summary Report
- --------------------------------------------------------------------------------
3. USE 4. DATE
To summarize on an annual basis the Contractor's 5. ORGANIZATION
accomplishments during the contract period. KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
DRD-015
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
The Work Order Summary Report shall provide a brief abstract, not to exceed one
(1) paragraph for:
1. Each Work Order that was completed during the contract period.
2. Each Work Order that is not completed at the end of the contract
period indicating:
a) The work accomplished.
b) The work remaining to complete the task.
79
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 019
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Automated Information Security Plan
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE IRM Rep 1 2 RT/AD See Block J
- --------------------------------------------------------------------------------
J. REMARKS
Initial submittal shall be 30 days after the contract start.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Automated Information Security Plan
- --------------------------------------------------------------------------------
3. USE 4. DATE
To detail the Contractor's plan to assure that adequate 5. ORGANIZATION
security is provided for all agency information collected, KSC
processed, transmitted, stored or disseminated in general
support systems and major applications.
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
See Block 8
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
The Contractor shall prepare and submit for approval an Automated Information
Security Plan that complies with the requirements set forth in Appendix III to
0MB Circular A-130, "Security of Federal Automated Information Resources." The
plan shall include but not be limited to:
1. Assignment of responsibility for each system.
2. Provide for the incorporation of computer security into the software
life-cycle development process.
a) Rules
b) Training
c) Personnel Controls
d) Incident Response Capability
e) Continuity of Support
f) Technical Security
g) System Interconnection
3. Review of Security Controls
4. Management Authorization
- -----------------------------------
Block 6 References:
NHB 2410.9A
0MB Circular A-130, Appendix III
80
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 020
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Pressure Vessel/System Certification Report
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
EI 3 6 QU See Block J
- --------------------------------------------------------------------------------
J. REMARKS
Block G: Thirty Days after contract start.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Pressure Vessel/System Certification Report
- --------------------------------------------------------------------------------
3. USE 4. DATE
Data required to demonstrate Pressure Vessel/System
Certification KHB 1710.2C, Annex E guidelines, to ensure 5. ORGANIZATION
all DE ground-based pressure vessels and pressurized systems KSC
are certified safe to operate and are re-certified
periodically.
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
KHB 1710.2C, Annex E
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
The Pressure Vessel/System Certification Report covers all pressure vessels and
pressurized systems under the Contractor's responsibility. Contents shall be in
accordance with guidelines in KHB 1710.2C, Annex E (Contractor format is
acceptable).
81
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 2
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 021
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Monthly KSC Headcount Report
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-PCO 3 6 MO 11/01/97 30/5
- --------------------------------------------------------------------------------
J. REMARKS
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Monthly KSC Headcount Report
- --------------------------------------------------------------------------------
3. USE 4. DATE
Information for workforce reporting requirements. 5. ORGANIZATION
KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
DRD-003
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
A. Labor Reports should be submitted monthly, not later than the 5th day of
the following month.
B. A complete organization chart including all employees by skill or job
classification shall be provided.
C. Labor data should be submitted and should be formatted as follows:
Total Headcount at KSC
----------------------
Prime
- -----
On Site
Off Site
Dispossessed
Other Off Site
Total: ____________________
Subcontractors (by name): (Include only Subcontractors with on site personnel)
- ------------------------
On Site
Off Site
Dispossessed
Other Off Site
Total: ____________________
Construction
Subcontractors (by name): Brief Description Total
------------------------- ----------------- -----
(See continuation sheet)
82
<PAGE> 84
NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
1. DOCUMENT NO(s) 2.
DRD-021 KENNEDY SPACE CENTER Page 2 of 2
DOCUMENT CONTINUATION SHEET -------------------------
3. OFFICE
KSC
- --------------------------------------------------------------------------------
4. DOCUMENT 5. DATE
Monthly KSC Headcount Report
- --------------------------------------------------------------------------------
6. Block 8. Preparation Information Continued:
The following definitions apply to the above items:
1. On Site - Those personnel performing on the contract occupying
physical space on the Kennedy Space Center or the Cape Canaveral Air
Station. This includes those personnel temporarily absent from
assigned duty stations (e.g., on leave without pay, annual/sick
leave).
2. Off Site - Total of those personnel performing on the contract, but
physically located outside the environs of KSC or CCAS.
a. Dispossessed - Those personnel who normally would occupy physical
space within the environs of KSC, but who have been located
outside due to non-availability of space.
b. Others Off Site - Those personnel within total contract headcount
who are not planned to occupy physical space within the environs
of KSC of CCAS.
3. Construction Subcontractors - Those personnel performing on the
contract within the environs of KSC or CCAS. Include a brief
description or title of the effort.
83
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 022
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
GIDEP Alert Systems
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
EI 3 6 See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
Block F: Responses to Alerts affecting flight hardware processing within 90
days. Contractor initiated Alerts due to NASA within 10 days.
Block G: Initial submission as required.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
GIDEP Alert Systems
- --------------------------------------------------------------------------------
3. USE 4. DATE
To report disposition of application problems encountered with
parts/materials. 5. ORGANIZATION
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
See Block 8
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
The GIDEP Alert System notifies all organizations of problems associated with
GSE items which could cause loss of GSE, flight hardware or personnel.
The Alert System shall:
- -----------------------
a. Identify an individual Contractor Alert point of contact.
b. Review nonconformance and other failure documentation to determine if
there is a problem which requires initiation and distribution of an
Alert.
c. Immediately notify the KSC Alert contact point (EI-F-C) of Alert
problems.
d. Provide follow-up notification by sending completed Alert Report (DD
Form 1938) to the KSC Alert contact.
e. Ensure dissemination of incoming Alerts on a timely basis to all
personnel within the Contractor's organization whose functional
responsibilities could be affected.
f. Initiate a KSC close-out report on the Alerts when requested by
NASA/KSC and forward to the KSC Alert contact. These instances are
normally limited to Alerts which may impact processes and procedures
conducted within KSC.
FORMAT:
- -------
a. Response - KSC close-out report in Contractor's format.
b. Contractor initiated Alert - Form DD 1938.
MAINTENANCE: Revisions as required.
- ------------
- -----------------------------
Block 6. References:
KHB 5310.1C with change 5 GOP 3.2
84
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 2
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 023
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Summary Labor Report
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-PCO 3 6 WK See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
Initial Submittal shall be not later than 7 days after contract start. This is a
weekly report that will provide weekly, cumulative month to date, and cumulative
year to date labor totals; the actual due dates and as of dates will be
determined after contract start.
* Block K - Code D: Data to be provided on electronic medium. The CTM will
determine the type and quantity.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Summary Labor Report
- --------------------------------------------------------------------------------
3. USE 4. DATE
To provide the Resources Management Office, and the 5. ORGANIZATION
Technical Contacts with a weekly and monthly KSC
cumulative to date status of Work Order activity.
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
DRD-003, DRD-015, DRD-018, DRD-024
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
A. This report shall consist of tabular data capable of being sorted and
summarized by: Work Order Number, EDC Lab Code, or Program/Unique Project
Number Code.
B. Labor data shall be provided for the current week being reported; the
current month being reported (cumulative for the month); and life to date
totals.
C. Contents of the report shall include, but not be limited to, the following
information:
1. Work Order Number
2. Latest Work Order Revision Number
3. Program Code
4. Work Order Title
5. EDC Work Order Lead
6. EDC Lab Code
7. EDC Supervisor
8. Work Order Status (open, closed, inactive)
9. Technical Contact Name
10. Latest Revision Date
11. Work Order Unique Project Number
12. Life to date totals shall include the following elements categorized
by Straight Time, Overtime, and Total Hours
a. Authorized hours
b. Expended Hours
c. Hours Balance (authorized less expended)
d. Equivalent Headcount Balance
e. Percent (%) Hours Expended
(See continuation sheet)
85
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
1. DOCUMENT NO(s) 2.
DRD-023 KENNEDY SPACE CENTER Page 2 of 2
DOCUMENT CONTINUATION SHEET -------------------------
3. OFFICE
- --------------------------------------------------------------------------------
4. DOCUMENT 5. DATE
Summary Labor Report
- --------------------------------------------------------------------------------
6. Block 8. Preparation Information Continued:
13. Current month to date and Current Week Totals shall include the
following elements, categorized by Actual Hours, Forecast Hours, &
Adjustments
a. Straight Time Hours
b. Overtime Hours
c. Subcontractor Hours
d. Total Hours
e. Equivalent Headcount
14. Current Fiscal Year Material/Maintenance Status will list the
following:
a. Authorized amount
b. Expended amount
c. Balance amount
86
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 2
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 024
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Work Order Revision Status Report
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
GC-C1-C 1 3 MO/UR See Block J 30/5
- --------------------------------------------------------------------------------
J. REMARKS
Initial submittal shall be not later than 15 days after contract start.
The report shall be capable of being sorted according to responsible
organization and by Program/UPN.
* Block K - Code D: Data to be provided on electronic medium. The CTM and OPR
will determine the type and quantity.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Work Order Revision Status
- --------------------------------------------------------------------------------
3. USE 4. DATE
To provide the Resources Management Office, and the 5. ORGANIZATION
Technical Contacts with an updated status of authorized work KSC
for budget tracking.
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
DRD-003, DRD-015, DRD-018, DRD-023
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
A. The Status Report shall consist of tabular data capable of being sorted by
Work Order Number, EDC Lab Code, Program/UPN Code, or NASA Technical
Contact Organization.
B. Contents of the report shall include, but not be limited to, the following
information:
1. Work Order Number
2. Work Order Modification Number
3. Date Latest Revision Received
4. Modification Code
5. Work Order Title
6. Identity of NASA Technical Contact
7. Organization Code of NASA Technical Contact
8. EDC Lab Code
9. Work Order Status
10. Contractor Project Code Number
11. Project Control Number
12. Program Code
13. Unique Project Number (UPN)
14. Activity Classification Number (ACN)
15. The Previous Amounts (FROM); Change Amount (DELTA); and New Amounts
(TO) for the following elements:
a. Equivalent Headcount
b. Authorized Productive Labor Hours
(See continuation sheet)
87
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
1. DOCUMENT NO(s) 2.
DRD-024 KENNEDY SPACE CENTER Page 2 of 2
DOCUMENT CONTINUATION SHEET -------------------------
3. OFFICE
- --------------------------------------------------------------------------------
4. DOCUMENT 5. DATE
Work Order Revision Status Report
- --------------------------------------------------------------------------------
6. Block 8. Preparation Information Continued:
c) Labor Hour Rate Used
d) Authorized Labor dollars
e) Authorized Material/Maintenance dollars
f) Current Year Adjustment
g) Total Work Order Fiscal Year Value
h) Funding Limit - Current Fiscal Year
i) Cumulative Value (Prior Year and Current Year)
16. Comments / Notes
88
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- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 2
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 025
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Technology Transfer Plan
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-TPO 1 2 RT See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
The initial report submittal shall be 30 days after the contract start.
* Block K - Code D: Data to be provided on electronic medium. The CTM will
determine the type and quantity.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Technology Transfer Plan
- --------------------------------------------------------------------------------
3. USE 4. DATE
To describe the Contractor's plan for implementation 5. ORGANIZATION
of NASA's technology transfer policies. KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
DRD-026
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
The Contractor shall establish a written, detailed Technology Transfer Plan
setting forth the manner in which the contractor will meet the new technology
reporting requirements of the Patent Rights clause (FAR 52.227-11 as modified by
NFS 1852.227-11). The plan will also identify how the contractor will implement
NASA's technology transfer policy set forth in NASA's "Agenda for Change." The
plan shall address, at a minimum, the following:
1. Identify the specific areas of technical effort that are considered likely
to generate new technology.
2. Describe the means by which project supervisory and technical personnel
will be advised of the responsibilities, details, and benefits of new
technology reporting.
3. Describe the procedures to be established, maintained, and followed for
reviewing the effort to be undertaken for the purposes of identification
and reporting (disclosure) of new technology within the time periods and in
the manner prescribed by the Patent Rights clause.
4. Describe the procedure for timely submission of the interim and final new
technology reports required by the Patent Rights clause.
5. Describe the procedures for (a) selecting either NASA's New Technology
clause (NFS 1852.227-70) or another patent rights clause for inclusion in
subcontracts having as a purpose the conduct of experimental,
developmental, research, design, or engineering work, and (b) providing
prompt notification of either the award of such subcontracts or a
subcontractor's refusal to accept the clause.
6. Identify the individual(s) assigned substantial and specific
responsibilities for ensuring compliance with the requirements of the
Patent Rights clause, as well as their qualifications and organizational
placement to discharge these responsibilities.
(See continuation sheet)
89
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
1. DOCUMENT NO(s) 2.
DRD-025 KENNEDY SPACE CENTER Page 2 of 2
DOCUMENT CONTINUATION SHEET -------------------------
3. OFFICE
- --------------------------------------------------------------------------------
4. DOCUMENT 5. DATE
Technology Transfer Plan
- --------------------------------------------------------------------------------
6. Block 8. Preparation Information Continued:
7. Establishment of a technology transfer point of contact for
coordinating all technology transfer activities.
8. The Contractor's commitment to the development of cutting-edge dual
use technologies having both application within and outside of the
aerospace community.
9. Programs aimed at educating and motivating employees to report new
technology.
10. Programs that assist subcontractors in establishing technology
transfer policies and implementing technology transfer plans.
11. Programs that support NASA's outreach and industry assistance efforts
pertaining to technology transfer.
12. Programs aimed at conducting collaborative efforts with third parties
for the purpose of effectively transferring technology.
Funding for such collaborative efforts will not necessarily include
government funds and may consist of totally private funds. These
collaborative efforts shall be reviewed and, where Government funds are to
be used, approved by the Contracting Officer. Ownership of rights to the
technology developed under these collaborative efforts shall be addressed
in the individual agreements that are negotiated as part of the technology
transfer process.
13. Programs aimed at conducting application engineering work for the
purpose of adapting the developed technology to a specific commercial
use.
14. Programs that demonstrate a strong management commitment to technology
transfer.
To maximize the benefits received from the program, it will be necessary to
identify and protect the intellectual property rights associated with the
technology developed under this contract (i.e., patents, copyrights, trade
secrets and know-how). To the extent feasible, the Government agrees to use its
best efforts to transfer rights in government-owned technology in order to
support the Contractor's technology transfer program.
90
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 026
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Technology Transfer Report
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-TPO 1 2 QU See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
The initial report submittal shall be submitted 3 months after the contract
start.
* Block K - Code D: Data to be provided on electronic medium. The CTM will
determine the type and quantity.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Technology Transfer Report
- --------------------------------------------------------------------------------
3. USE 4. DATE
To describe the Contractor's new technology activity. 5. ORGANIZATION
KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
DRD-025 See Block 8
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
Prepare and submit a Technology Transfer Report on the following technology
transfer activities:
1. Identify all reportable new technology items developed under this contract
during the reporting period in accordance with the Patent Rights clause
(FAR 52.227-11 as modified by NFS 1852.227-1l).
2. Identify promising technologies developed under this contract during the
reporting period having dual-use application.
3. Report on the activities conducted under the Contractor's Technology
Transfer Plan during the reporting period.
91
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- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 027
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Procurement Summary Report
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-PCO 1 6 MO See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
Block G - Initial submittal one month after start of contract.
* Block K - Code D: Data to be provided on electronic medium. The CTM will
determine the type and quantity.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Procurement Summary Report
- --------------------------------------------------------------------------------
3. USE 4. DATE
To report the status of Contractor procurements 5. ORGANIZATION
KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
1. Work Order number
2. Purchase Request number
3. Purchase Order number
4. Originator
5. Account number
6. Date required
7. Date delivered
8. Dollar amount committed
9. Dollar amount obligated
10. Dollar amount costed
92
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- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 028
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Contractor Workforce and Funding Authority Summary Report
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-PCO 1 6 QU/UR See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
Block G - Initial report 1 month after contract start and quarterly thereafter.
* Block K - Code D: Data to be provided on electronic medium. The CTM will
determine the type and quantity.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Contractor Workforce and Funding Authority Summary
Report.
- --------------------------------------------------------------------------------
3. USE 4. DATE
To report Contractor workforce and funding authority 5. ORGANIZATION
by program to the Government. KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
Prepare summary charts for Contractor workforce and funding authority,
subdivided and totaled by program and laboratory. Also indicate totals for M&A
and direct workforce.
93
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NAS10-98001 (EDC) Attachment J-1, Appendix 1
- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 029
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Contractor Resource Management Summary and Concerns Report
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-PCO 1 6 MO See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
Block G - Initial submission shall be within one month of contract start.
* Block K - Code D: Data to be provided on electronic medium. The CTM will
determine the type and quantity.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Contractor Resource Management Summary and Concerns
Report
- --------------------------------------------------------------------------------
3. USE 4. DATE
To report Contractor resource management and concerns to 5. ORGANIZATION
the Government. KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
Prepare a report that summarizes the resource management status of the contract
and describes issues and concerns relevant to resource management including:
Contract Funding
Contingent Liabilities
Authorized verses On Board Strength
Planned versus Actual Headcount and, if diverted, Why?
Unpaid Leave/Leave Cap
Procurement Issues
Other Areas of Concern
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- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 030
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Work Plan
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
DE-PCO 1 2 AR See Block J See Block J
- --------------------------------------------------------------------------------
J. REMARKS
Block G - Work Plans should be submitted within two days after the Contractor's
receipt of a Work Order.
* Block K - Code D: Data to be provided on electronic medium. The CTM will
determine the type and quantity.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Work Plan
- --------------------------------------------------------------------------------
3. USE 4. DATE
To describe the Contractor's plan for implementation of 5. ORGANIZATION
the Work Order. KSC
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
The Contractor shall submit a plan (if required by the Work Order) describing
the proposed approach for performing each Work Order. The following information
shall be included:
1. Title and number of applicable Work Order.
2. Discussion of the technical approach for performing the work.
3. Discussion of skill mix requirements.
4. Proposed schedule including estimated date of work commencement.
5. Direct Labor hours (Straight time and overtime), on a monthly basis
by applicable labor category, and total direct labor hours estimated
to complete the work.
6. Travel and material estimates.
7. Estimate of subcontractors and consultants, including direct labor
hours, if applicable.
8. Other indirect costs required to complete the work.
9. Recommended metrics for use in monitoring and evaluating the
Contractor's performance.
10. Other pertinent information.
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- --------------------------------------------------------------------------------
DATA REQUIREMENTS Page 1 of 1
CONTRACT APPLICATION INFORMATION FOR DRL EDC A. ITEM NO. 031
- --------------------------------------------------------------------------------
B. LINE ITEM TITLE:
Equal Employment Opportunity Report
- --------------------------------------------------------------------------------
C. OPR. D. TYPE E. INSPECT/ACCEPT F. FREQ. G. INITIAL SUB. H. AS OF DATE
EO 3 2 QU 1/7/98 90/7
- --------------------------------------------------------------------------------
J. REMARKS
* Block K - Code D: Data to be provided on electronic medium. The CTM will
determine the type and quantity.
- --------------------------------------------------------------------------------
K. DISTRIBUTION TOTALS
---------------
Provided by Contracting Officer NO. TYPE
---------------
---------------
- --------------------------------------------------------------------------------
DATA REQUIREMENT DESCRIPTION
- --------------------------------------------------------------------------------
1. TITLE 2. NUMBER
Equal Employment Opportunity Report
- --------------------------------------------------------------------------------
3. USE 4. DATE
This document will be used by Government personnel 5. ORGANIZATION
to assess the contractor's equal employment and KSC
affirmative action management of the contract effort.
- --------------------------------------------------------------------------------
7. INTERRELATIONSHIP 6. REFERENCES
- --------------------------------------------------------------------------------
8. PREPARATION INFORMATION
A. Format and content of the report shall be in accordance with KSC Forms
32-58 C/G 1/91, Quarterly Equal Opportunity Statistical Report, and a
narrative report for Equal Employment Activities containing, as a minimum,
the following:
Contract Number
Community Activities
Recruiting Activities
Special Events
Other pertinent information.
B. Reports shall be provided not later than the 7th of the month which follows
the end of a calendar quarter.
Note: Contractor may reproduce the forms, or obtain from the NASA EO Office a
diskette which will enable them to generate the forms through the use of Lotus
123, Quattro Pro, or Excel.
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- --------------------------------------------------------------------------------
ATTACHMENT J-1
APPENDIX 2
SAFETY, RELIABILITY AND MAINTAINABILITY REQUIREMENTS
INTRODUCTION
This document incorporates appropriate safety, reliability, and maintainability
provisions of NASA documents: NHB 1700.1, "NASA Safety Manual"; and Vol. 1; NHB
5300.4 (1D-2), "Safety, Reliability, Maintainability and Quality Provisions for
the Space Shuttle Program."
GENERAL SAFETY, RELIABILITY AND MAINTAINABILITY REQUIREMENTS
1. The Contractor shall maintain a safety activity planned and developed in
conjunction with other functions to assure that hazards are identified
and eliminated or controlled to an acceptable level of risk. In addition
to the development of a safety plan, safety requirements and tasks will
be reflected as appropriate in other contract program plans. Applicable
safety requirements and tasks shall be included in the basic management
systems, design verification documents, overall system analyses, and
system engineering requirements definition, and design review practices.
2. The Contractor shall conduct industrial safety activities in compliance
with NASA FAR Supplement 1852.223-70. Industrial safety includes, as a
minimum, identification, elimination, and/or control of hazards in
employee and public areas; accident prevention, fire prevention and
protection, and transportation accident prevention for all Contractor
activities.
3. Safety requirements for planning, design, manufacturing, testing, and
operations shall be developed and documented as an integral part of the
Contractor's activities. The Contractor shall establish checkpoints and
feedback which provide visibility to management to assure all safety
issues/concerns have been evaluated and resolved prior to commencement
of critical activities and major milestones. Safety assessments shall be
revised and updated as design and operational changes dictate.
4. Safety activities shall be fully coordinated to ensure an effective and
integrated total safety effort and to avoid redundant effort among
technical disciplines.
5. The Contractor shall support periodic safety activity audits as
required. The Contractor shall provide data upon request which verifies
internal conformance and the conformance of subcontractors to safety
requirements. The Contractor shall maintain audit reports to be made
available to NASA upon request.
6. The Contractor shall provide training and certification for personnel
who are to be involved in hazardous operations and activities. The
Contractor shall identify positions requiring training and
certification. A current status of certification shall be maintained
oriented to missions, configurations, and locations. Protective devices
and emergency equipment shall be identified and included in safety
training. Hazards shall be brought to
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- --------------------------------------------------------------------------------
the attention of trainees. Proficiency demonstrations of training, to
the degree feasible, are required for hazardous operations.
7. The Contractor shall provide the means for reviewing safety status as
part of each program review. Risk management data shall be made
available and/or presented at program progress reviews and milestone
reviews when applicable and/or upon NASA request.
8. The Contractor shall select and levy safety requirements specified in
this document, as appropriate, on the subcontractors who provide
subsystems which, in either normal or emergency operational modes, may
present hazards impacting system or personnel safety.
9. The Contractor shall establish and identify procedures and instructions
which shall be used to execute all safety analyses. The Contractor shall
perform system safety analyses assuring that:
A. Safety is designed into the product; known hazardous conditions
which cannot be eliminated through equipment design or
operational procedures are controlled or reduced to an
acceptable level. Residual hazards shall be tracked and
identified to NASA.
B. Provide continuous tracking and status of hazard severity; the
aim being to reduce catastrophic and critical hazards to
controlled levels within the constraints of risk management.
C. Results of previous trade studies and analyses are considered.
D. Other related analyses, such as Failure Modes and Effects
Analyses (FMEA), are considered to preclude duplication of
analytical work.
10. The Contractor shall perform safety studies and shall develop safety
inputs to support trade studies. Specific, inherently hazardous
characteristics of the alternatives being considered shall be
identified. The Contractor shall document rationale to support the
selected concept and to demonstrate that it includes the optimum safety
provisions consistent with program objectives, risk management,
performance, cost, and schedules.
11. For proposed waivers and deviations, the Contractor shall establish a
means to analyze the safety impact. Submissions of safety variance
requests shall be in accordance with KHB 1710.2C, Annex B, "KSC Safety
Practices Handbook."
12. The Contractor shall assure safe methods are implemented for handling
hardware to assure that it is not damaged during operations.
13. The Contractor shall comply with, and submit a statement verifying the
compliance of all the Occupational Safety and Health Administration
Standards, Part 1910, Sub-parts D, F and N, in addition to any
applicable KSC safety regulations, for safety-critical handling
hardware, and personnel walking and work platforms.
14. When changes are proposed for equipment design or procedures, the
Contractor shall identify and resolve hazards that may be introduced
into the system. All hazards, including residual hazards, shall be
identified as part of the engineering change evaluation/risk assessment
process.
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- --------------------------------------------------------------------------------
15. Provisions shall be made to assure adequate validation tests are
performed on critical devices or components to determine the degree of
hazard or margin of safety of design. These types of tests will be
specified in the development and verification requirements.
16. The Contractor shall review test plans for ground testing and flight
testing of critical space flight and ground equipment when directed to
assure tests are adequate to identify and assess potential hazards,
protect personnel, and avoid damage to test articles and facilities.
17. Observation of designated hazardous tests/operations shall be performed
as necessary to ensure adherence to safety principles and compliance
with safety requirements and checklists. The Government safety
representative retains the authority to stop work/tests at any time. The
Contractor safety representative also has the authority to stop
work/tests due to unsafe/hazardous conditions. The authority to resume
work/tests resides with the safety organization initiating the stop
work/test.
18. Detailed test procedures and related documents for hazardous or high
cost tests/operations shall be reviewed and approved by the Contractor's
designated responsible safety personnel and approved by NASA Safety. In
the event the Contractor places personnel in hyperbaric and altitude
chambers or other similar type hazardous facilities, applicable safety
requirements shall be met. Documents dealing with hazardous operations
shall be in place and available a minimum of ten days prior to there
use.
19. The Contractor shall maintain a reliability and maintainability process
planned and developed in conjunction with other Contractor elements for
ground support equipment (GSE) interfacing with flight hardware. These
functions shall be an integral part of the design, development, test,
and checkout process and shall include the evaluation of hardware
reliability and maintainability through analysis, review, and assessment
as necessary.
SPECIFIC SOFTWARE SAFETY STANDARDS
Introduction
This Software Assurance Standard is based on NASA-STD-220lWC as modified for the
effort under this contract. This is a stand-alone document prepared using
NASA-STD-2201 WC as a basis.
1. Scope
This Standard specifies the software assurance program for the provider
of operational software products. It also delineates the assurance
activities for the provider.
- ------------
(3) Operational Software - All flight software and ground software that either:
(1) interfaces with on-orbit elements in real-time, (2) is critical to the
mission (such as all control center, test, and certification software, including
associated models and simulators); (3) Software Support Environment (SSE)
software that interfaces with on-orbit elements in real-time or is critical to
the mission; and/or (4) software within ground support equipment (GSE) that
interfaces with on-orbit elements in real-time or firmware (embedded software
that commands and controls GSE).
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NAS10-98001 (EDC) Attachment J-1, Appendix 2
- --------------------------------------------------------------------------------
These requirements apply to all operational software for which the
Kennedy Space Center (KSC), NASA, is responsible.
2. Purpose
This Standard specifies, at a high level, an overall software assurance
program for operational software developed for and by NASA and/or NASA
contractors. Assurance includes the disciplines of Quality Assurance,
Quality Engineering, Verification and Validation, Nonconformance
Reporting and Corrective Action, Safety Assurance, and Security
Assurance. The application of these disciplines during a software
development life cycle is Software Assurance.
3. Requirements
A. General
A software assurance program shall be planned, documented, and
implemented for operational software development activities. The
software assurance program shall:
1. Ensure that assurance requirements are documented and
satisfied throughout all phases of the life cycle.
2. Detect actual or potential conditions that could degrade
quality, including deficiencies and system
incompatibilities, and provide a process to ensure
corrective action is taken and completed including
appropriate risk assessments.
3. Assure timely and effective preventive action by
identifying root causes of deficiencies and
nonconformances.
B. Software Assurance Plan
The Contractor shall prepare, implement, and maintain a Software
Assurance Plan that describes how the Contractor will ensure
compliance with the requirements set forth herein. The Plan shall
describe how the activities specified by this Standard will be
implemented over the software life cycle. The Plan shall be
reviewed and, if needed, updated at the end of each life cycle
phase. The Plan shall address, but is not limited to, the:
1. Identification and integration of safety, reliability,
maintainability, and quality assurance requirements and
tasks.
2. Descriptions of the procedures for each software
assurance task including traceability to assurance
program requirements.
3. Assignment of responsibility for ensuring that the
requirements are met and the work accomplished.
4. Description of the role of the software assurance
program in activities for continuous improvement such
as:
a) A strategy that emphasizes prevention, not correction.
b) Improved use of tools and techniques.
c) Collection and evaluation of metric data.
d) Suggestions for improvements in assurance methods.
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NAS10-98001 (EDC) Attachment J-1, Appendix 2
- --------------------------------------------------------------------------------
e) Scheduling and staffing to support software assurance
activities and tasks, including management and status
reporting.
C. Software Assurance Records
Records shall be prepared that contain the descriptions and
results of all software assurance activities. Results, such as
status reports and audit reports, shall include recommended
preventive measures and corrective actions. These records shall
be available to the Government.
D. Software Assurance Status Reporting
Software assurance status reports shall be prepared on software
assurance activities when requested by the applicable work order.
E. Software Assurance Management
The Contractor shall designate a Software Assurance Manager who
shall be responsible for directing and managing the software
assurance program. The Software Assurance Manager shall have a
reporting channel to Contractor management that is independent of
the Contractor's project management and software development
functions. The Software Assurance Manager shall concur on the
establishment and composition of all software baselines and any
changes to the baselines.
F. Software Assurance Functions
Software Assurance Functions are concerned with the evaluation of
the quality of software products; the adherence to
software-related standards, plans, and procedures; incorporation
of safety, reliability, maintainability, quality, and usability;
satisfaction of system safety requirements that are allocated to
the software; the identification and verification of adequate
safety controls and inhibits that are to be implemented in
software; and that the products satisfy functional and other
requirements yielding the right products. These activities shall
be performed during each phase of the software life cycle.
1. This process shall ensure that:
a) Standards, plans, and procedures for management,
engineering, and assurance activities are
specified, completed, implemented, and adhered
to.
b) All documentation and report formats and content
descriptions are defined.
c) Baseline control, configuration identification,
configuration control, configuration status
accounting, and configuration authentication
activities are carried out.
d) NASA software and the accompanying Acceptance
Data Package(s) (ADP) are delivered in
accordance with contractual requirements.
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NAS10-98001 (EDC) Attachment J-1, Appendix 2
- --------------------------------------------------------------------------------
e) All quality requirements are defined in a manner
that is measurable or otherwise verifiable.
f) Safety, reliability, quality, maintainability,
and usability requirements are considered during
software design and design change processes.
g) The software is tested/measured as necessary to
verify compliance with safety, reliability,
quality, and maintainability requirements.
h) Safety-related deficiencies in specifications
and design are identified and corrected.
i) Software design incorporates positive measures
to enhance the safety of the system.
2. This process shall include the following activities:
a) Monitoring of formal inspections and formal
reviews.
b) Monitoring/witnessing of formal and
acceptance-level software testing.
c) Evaluations of software to ensure compliance
with software assurance requirements.
d) Collection and analysis of metric data
pertaining to quality requirements.
e) Determining the safety criticality for software
components.
f) Analyzing consistency, completeness,
correctness, and testability of safety
requirements.
g) Analysis of design and code to ensure that they
correctly implement safety-critical
requirements.
h) Analysis of changes for safety impact.
G. Software Verification And Validation
1. Software verification and validation (V&V) is concerned
with ensuring that software being developed or
maintained satisfies functional and other requirements
and that each phase of the development process yields
the right products.
2. V&V activities shall be performed during each phase of
the software life cycle and shall include the following:
a) Analysis of system and software requirements
allocation, verifiability, testability,
completeness, and consistency (including
analysis of test requirements).
b) Design and code analysis including design
completeness, correctness, and compliance with
applicable software requirements and standards.
c) Interface analysis (requirements and design
levels).
d) Formal Inspections Reviews, as required.
e) Test planning, performance, and reporting.
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NAS10-98001 (EDC) Attachment J-1, Appendix 2
- --------------------------------------------------------------------------------
H. Training
Personnel developing and implementing the software assurance
process shall be trained and/or experienced in software
assurance. Software assurance training shall be obtained and/or
originated and maintained as necessary for management,
engineering, and assurance personnel. Records shall be maintained
and readily available for review of the training, testing, and
certification/recertification status of personnel.
I. Subcontractor Controls
The Contractor shall be responsible for the adequacy and quality
of all software, associated documentation, and services procured
through subcontracted efforts. The Contractor shall flow down the
requirements of this Standard to any sub-tier provider of
software.
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NAS10-98001 (EDC) Attachment J-1, Appendix 3
- --------------------------------------------------------------------------------
ATTACHMENT J-1
APPENDIX 3
Work Order Procedure
--------------------
1. Work Orders and Work Order Revisions
------------------------------------
a. Implementing documents to define work to be performed within the
limitations of the contract will be issued by the NASA Contracting
Officer (CO). This implementing document is a Work Order (WO), KSC Form
2-132 (C/G 2/97). WOs are normally filled out by Technical Contacts
(TCs) and approved by Technical Representatives (TRs).
b. Each WO sets forth the scope of the work to be performed, including
travel, training and technical requirements. The WO establishes a labor
hour limit, outside procurement and Other Direct Costs (ODC) limit,
total funding limit and required completion date. Funding limits and
required completion dates shall not be exceeded without prior approval
of the Contract Technical Manager (CTM). Each such approval must be
documented by a revision to the WO, using the same form. Work shall not
commence unless the WO or revised WO is signed by the CTM and the CO. In
emergency cases, verbal authority to proceed may be granted by the CTM.
In such cases, written WO authorization will be issued within 48 hours
(2 working days).
c. Work Orders may also contain Standards of Performance (SOP), Maximum
Error Rates (MER) and performance metrics to be reported. A Standard of
Performance defines mid-excellent range (~95) performance for a
particular element or metric. A Maximum Error Rate defines performance
in the mid-satisfactory range (~65) for a particular element or metric.
Metrics will define how to measure performance against the SOPs and
MERs, and will be used by the TRs and CTM as a tool in the evaluation of
the Contractor's performance of the WO. Work Orders may also contain
Critical Milestones. The Contractor's success in accomplishing Critical
Milestones will be tracked by the CTM as a contract-wide metric.
d. The Contractor, upon receipt of a WO or revised WO, shall acknowledge
receipt by returning one signed copy to the CTM, CO, Resource Management
Office (RMO), Project Control Office (DE-PCO) and each TR named in the
document within two working days after receipt. In the event the
Contractor does not agree with the requirements, funding limits,
Critical Milestones, or other elements of the WO, the Contractor shall
proceed with performance and provide the TR a written assessment and
recommendations within two working days of receipt of the WO. The TR
will revise the WO, if necessary, or notify the Contractor that no
changes were deemed necessary, within two working days of receiving the
written assessment. Issues which cannot be resolved between the
Contractor and the TR within four working days following TR receipt of
the written assessment should be presented to the CTM for resolution.
Unresolved matters will be referred to the CO. Any differences must be
resolved between the parties and the WO revised to reflect the
agreement.
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NAS10-98001 (EDC) Attachment J-1, Appendix 2
- --------------------------------------------------------------------------------
e. Unless noted otherwise on the WO, the Contractor shall submit a Work
Plan, per DRD-030, describing how the work will be accomplished,
including the technical approach, resources required and recommended
metrics.
f. A subsidiary document to WOs is a Technical Directive (TD) (KSC Form
21-156). TDs will be issued by TCs and TRs to the Contractor via the CTM
where it is necessary to provide more specific details within the scope
of the WO. The use of TDs shall be confined to the substance of the
work. All TDs shall be in writing. TDs do not require signature
acknowledgment by the Contractor. Questions concerning the propriety of
a TD or its contents, effectivity, applicability, etc., shall be
referred to the CTM for resolution. Unresolved matters will be referred
to the CO.
g. Upon completion of a WO, the Contractor shall sign the WO, and forward
the original WO to the CTM. The Contractor shall forward copies of the
signed, closed-out WO to the CO and TR.
h. During the life of a WO, the Contractor shall maintain a close-out
folder of historical records of significant activity involving the WO.
Upon completion of the WO, the closeout folder shall serve as a
permanent WO record that has potential value to any follow-on effort and
shall be maintained in accordance with disposition schedules in
NHB 1441.1 (as revised). The close-out folder shall be retained by the
Contractor for the duration of the contract (including all exercised
options or extensions), at which time it shall be turned over to the
Federal Records Center for disposition in accordance with applicable
schedules in NHB 1441.1 (as revised).
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NAS10-98001 (EDC) Attachment J-1, Appendix 3
- --------------------------------------------------------------------------------
EDC WORK ORDER FLOW
-----------------
| WORK ORDER |
PREPARATION
| FORM 2-132 |
PER DE-P 325
-----------------
|
-----------------
| TR/TC SIGNS |
WORK ORDER ___________
| / REVISION | |
----------------- |
| |
----------------- |
| PCO / RMONS | |
VERIFY |
| FUNDING | |
----------------- |
|
----------------- |
| CTM APPROVES | |
| | |
----------------- |
| REVISIONS
----------------- |
| CO CONCURS & | |
ISSUES TO |
| CONTRACTOR | |
----------------- |
---------------- | |
|COPY OF SIGNED| ----------------- |
WORK ORDER TO | CONTRACTOR | |
|CO, DE-PCO, |______________ SIGNS & |
CTM, RMO, TRs | ACKNOWLEDGE | |
--------------- RECEIPT |
----------------- |
| |
----------------- |
---------------- | CONTRACTOR | |
|COPY OF PLAN | PROCEEDS WITH |
IF APPLICABLE, ______________| WORK AND |____________
| TO | PREPARES A
CO, DE-PCO, | WORK PLAN |
| CTM, TRs | -----------------
--------------- |
-----------------
| CONTRACTOR |
COMPLETES
| WORK |
-----------------
|
------------------ -----------------
|COPY OF COMPLETED| | CONTRACTOR |
WORK ORDER TO CO, ACKNOWLEDGES
| DE-PCO, TRs |__________| WORK ORDER |
------------------ COMPLETION AND
| FORWARDS TO |
CTM
-----------------
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- --------------------------------------------------------------------------------
ENGINEERING DEVELOPMENT ORIGINATION DATE:
WORK ORDER PAGE 1 OF
- --------------------------------------------------------------------------------
1. TO: 2. WORK ORDER NO. 3. REV.: 4. PCN:
- --------------------------------------------------------------------------------
5. TITLE: 6. PROGRAM: 7 REQ.COMPLETION DATE
8. FY EFFECTIVITY:
- --------------------------------------------------------------------------------
9. WORK ORDER PLAN NOT REQUIRED [_]
- --------------------------------------------------------------------------------
10. APPROPRIATION NUMBER: GG-CI-C: 11. PROJECT CODE 12. WORK ORDER TYPE:
MISSION SUPPORT PROJECT
- --------------------------------------------------------------------------------
13. AUTHORIZED EQUIVALENT PRODUCTIVE 14 AUTHORIZED OUTSIDE PROCUREMENT
LABOR HOURS AND OTHER DIRECT COSTS
(NOT TO BE EXCEEDED) (NOT TO BE EXCEEDED)
FROM: FROM:
DELTA: DELTA:
TO: TO:
- --------------------------------------------------------------------------------
15. FUND LIMIT: GG-C1-C:
(NOT TO BE EXCEEDED) INITIALS:________ DATE:_________
FROM:
DELTA:
TO:
- --------------------------------------------------------------------------------
16. DESCRIPTION:
- --------------------------------------------------------------------------------
17. TECHNICAL CONTACT / ORG / PHONE: DATE 18. NASA TECH REP. / ORG: DATE
SIGNATURE___________________(OPTIONAL) SIGNATURE__________________
- --------------------------------------------------------------------------------
19. CONTRACT TECHNICAL MANAGER / ORG: DATE 20. CONTRACTING OFFICER / ORG DATE
SIGNATURE___________________ SIGNATURE__________________
- --------------------------------------------------------------------------------
21. RECEIPT ACKNOWLEDGED BY CONTRACTOR: DATE 22. COMPLETION ACKNOWLEDGEMENT BY
CONTRACTOR: DATE
SIGNATURE___________________ SIGNATURE__________________
- --------------------------------------------------------------------------------
KSC FORM 2-132 (c/a 2/97)
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NAS10-98001 (EDC) Attachment J-1, Appendix 3
- --------------------------------------------------------------------------------
INSTRUCTIONS
1. Requester - Name of performing activity
2. Contract
Technical - Contract Technical Manager (CTM) Control Number
Manager
3. Requester - Revision Number if required
4. Requester - Approved Project Control Number requested support is
applicable to (if required)
5. Requester - Title of work to be performed
6. Requester - Program requested support is applicable to
7. Requester - Required completion date
8. Requester - Fiscal Year Effectivity
9. Requester - Work Plan Not Required
(This block is checked if a Work Plan (DRD-030) is not
required.)
10. Requester - Appropriation number, if required, and RMO
initials verifying funding sources
11. Requester - Project Code
12. Requester - Work Order Type
13. Requester - Authorized straight-time hours to perform work
14. Requester - Authorized outside procurement dollars maximum
15. Requester - Maximum funding level authorized and RMO initials
verifying funding
16. Requester - Description of the work to be performed, including
travel, training and technical requirements,
critical milestones, major tasks, standards of
performance, maximum error rates, and
measurement methods (metrics) as applicable
17. Requester - Technical Contact responsible for work to be
accomplished. (In cases where more than
one discipline is involved the Technical Contact with
the preponderance of work effort will be responsible for
overall accomplishment)
18. NASA
Technical - Signature and date denoting approval for performing
Repres. activity to accomplish work.
19. Contract
Technical - Signature and date denoting approval for performing
Manager activity to accomplish work.
20. Contracting
Officer - Signature and date denoting concurrence
21. Performing
activity - Signature and date denoting acknowledgment of receipt
22. Performing
activity - Signature and date denoting Work Order is completed and
ready for closure. Contractor forwards original to CTM.
Copies of completed and approved Work Orders go to the
Contracting Officer, Technical Representative and PCO.
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NAS10-98001 (EDC) Attachment J-1, Appendix 3
- --------------------------------------------------------------------------------
1. DOCUMENT NO(s) 2. Page ____ of ____
Work Order Number: KENNEDY SPACE CENTER 3. OFFICE
DOCUMENT CONTINUATION SHEET
- --------------------------------------------------------------------------------
4. DOCUMENT: 5. DATE:
- --------------------------------------------------------------------------------
6.
- --------------------------------------------------------------------------------
KSC FORM 2-131
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- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
DESIGN ENGINEERING
TECHNICAL DIRECTIVE
- --------------------------------------------------------------------------------
TO: (NAME & CONTRACT NO.) TECHNICAL DIR. NO.:
- --------------------------------------------------------------------------------
TITLE: WORK ORDER NO.:
- --------------------------------------------------------------------------------
DATE:
- --------------------------------------------------------------------------------
TECHNICAL DIRECTION
- --------------------------------------------------------------------------------
NASA TECHNICAL REPRESENTATIVE (SIGNATURE) OFFICE SYMBOL
- --------------------------------------------------------------------------------
KSC FORM 21-156 (REV. 6/74)
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- --------------------------------------------------------------------------------
ATTACHMENT J-1
APPENDIX 4
REFERENCE AND APPLICABLE DOCUMENTS
APPLICABLE DOCUMENTS
Document Number Title
--------------- -----
DE-P 325B Procedure for the Preparation and Processing
of Work Orders to the Engineering Support
Contractors
DE-P 450, Rev. E Design Reviews
DE-P 720J Document Release Authorization (DRA)
EWR-127-1 Eastern and Western Range Safety Policies and
Practices
GP-435 Vol. I, Rev. B Engineering Drawing Practices Manual, Vol. I
of II, Ground Support Equipment
GP-435 Vol. II, Rev. B Engineering Drawing Practices Manual, Vol. II
of II, Facilities
ISO 9001 (ANSI/ASQC Quality Systems-Model for Quality Assurance
Q9001--1994) in Design, Development, Production,
Installation, and Servicing
KHB 1200.1 C Facilities, Systems, and Equipment Management
Handbook
KHB 1610.1A KSC Security Handbook
KHB 1610.2A Personnel Security Handbook
KHB 1710.2C Kennedy Space Center Safety Practices
Handbook
KHB 4000.1C w/ch. 3 Supply Support System Manual
KHB 8800.7A Hazardous Waste Management
KMI 1164.lOA Delegations, Redelegations and Designations
KMI 1270.2A KSC Continual Improvement
KMI 1440.1 F KSC Records Management and Vital Records
Programs
KMI 1610.2E Photography and Photographer Identification
KMI 1800.2B KSC Hazard Communication Program
KMI 8800.8 KSC Environmental Management
111
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NAS10-98001 (EDC) Attachment J-1, Appendix 4
- --------------------------------------------------------------------------------
APPLICABLE DOCUMENTS (Continued)
Document Number Title
--------------- -----
KSC-DE-512-SM, Rev. F Facility, System, and Equipment General
Design Requirements
KSC-DF-107, Rev. B DE Technical Documentation Style Guide
KSC-SPEC-G-0002, Rev. B Compiling Construction Cost Estimates,
Specification for
KSC SPEC-G-0003 Ground Support Equipment Cost Estimating,
Specification for
NASA-STD-2201-93 Software Assurance Standard
NPG 1441.1C Records Retention Schedules (Use NHB 1441.1C
until available)
NHB 4100.1C NASA Materials Inventory Management Manual
NHB 4200.1D NASA Equipment Management Manual
NHB 4200.2A Equipment Management User's Handbook for
Property Custodians
NHB 4300.1 w/ch. 2 NASA Personal Property Disposal Manual
NHB 5300.4 (1D-2) Safety, Reliability, Maintainability and
Quality Provisions for the Space Shuttle
Program
NPD 9501.1F NASA Contractor Financial Management
Reporting System
NPG 9501.2C Procedures for Contractor Reporting of
Correlated Cost and Performance Data
NSTS 08126G Problem Reporting and Corrective Action
(PRACA) System Requirements
0MB Circular A-130, Security of Federal Automated Information
Appendix III Resources
SSP 30223F Problem Reporting and Corrective Action for
the Space Station Program, International
Space Station Alpha Program
SSP 30695A Acceptance Data Package Requirements
Specification, International Space Station
Alpha Program
SSP 50004 Ground Support Equipment Design Requirements,
International Space Station
112
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NAS10-98001 (EDC) Attachment J-1, Appendix 4
- --------------------------------------------------------------------------------
REFERENCE DOCUMENTS
Document Number Title
--------------- -----
GP 99-3 Glossary of Business Management Terms at John
F. Kennedy Space Center
KHB 1040.1F w/ch. 1 KSC Comprehensive Emergency Preparedness Plan
KHB 5310.1C w/ch. 5 Reliability and Quality Assurance Handbook
KHB 6000.1C Transportation Support System Handbook
KMI 1810.1G KSC Occupational Medicine Program
NHB 1700.1(V1-B) NASA Safety Policy and Requirements Document
NHB 1700.6 Guide for Inservice Inspection of
Ground-Based Pressure Vessels and Systems
NHB 2410.9A NASA Automated Information Security Handbook
NMI 1040.3C Emergency Preparedness Program
NMI 1440.6D NASA Records Management Program
NMI 1710.3D Safety Program for Pressure Vessels and
Pressurized Systems
KSC-DL-4455 DE CAD/CAE Software Library Document
113
<PAGE> 115
NAS10-98001 (EDC) Attachment J-1, Appendix 5
- --------------------------------------------------------------------------------
ATTACHMENT J-1
APPENDIX 5
INFORMATION TECHNOLOGY (I/T) PLANNING AND REVIEW AT KSC,
--------------------------------------------------------
PRINCIPLES AND GOALS
The KSC "plan and review" policy applies to all direct-funded I/T capital
acquisitions whether for and/or by civil servants or contractors, and whether
the contractors are support or mission/program.
The criteria for review by the Chief Information Officer (CIO) Office is based
on Agency regulation and standardization, KSC standardization, unnecessary
replication, and cost. While, for procurement reasons, we also require a general
technical justification, this Office questions technical need only when it is
clear that there may be a misunderstanding or error in the description of the
I/T needed to accomplish the mission of the organization.
The basis of review revolves around a description of the order or acquisition
and a set of seven questions which must be answered for each. However, the
description and questions can be scoped to an entire project or task and not to
each order or acquisition therein. The answers to these questions (the "I/T
justification") are generally simple, and in any event, encompass and satisfy
both procurement and standards rules and regulations.
Required Information for I/T Plans
The following I/T Plan information must be provided in sufficient detail (high
level for Level A, detailed for Level B) to justify each resource acquisition:
Resource Identification - Provide Plan name, Data Processing Installation
(DPI), System, Project, and Contract name, as applicable.
Transaction Description - Describe each transaction (i.e., all I/T
resource purchases, project or grouped purchases, or other contract I/T
expenditures); include product details (name, model, quantities, etc.);
and indicate whether any purchases are for Civil Service use or use as
Government Furnished Equipment (GFE). Each transaction in a plan should
also be assigned a unique transaction number for later referral.
Cost Estimates - Provide estimated costs of transactions, separated into
the categories of Hardware, Software, Support Services, Commercial
Services (e.g., timesharing) and I/T Supplies. Also, indicate which costs
are competitive, compatibility limited, or sole source.
Technical Justification - Provide a brief explanation of why this
transaction is needed. Also, include additional explanation if purchasing
a non-standard product, or for compatibility limited or sole-source
purchases.
Hardware & Software transactions must also answer these seven questions as
appropriate:
1. Is this part of a defined R&D Program (include Project Title)?
2. Why can't you get along with what you have?
114
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NAS10-98001 (EDC) Attachment J-1, Appendix 5
- --------------------------------------------------------------------------------
3. Why can't we get along with what we have? (pool or redistribute)
4. Why can't it be satisfied with a solution that costs less?
5. How does it save NASA money? (business case)
6. Why can't you use what everybody else is using? (standards)
7. What is your plan for "waterfalling" replaced equipment or
software? (excessing) (Include explanation if no excess results
from this transaction.)
[NOTE: Where practical, please group transactions with common
justifications and answers to the seven questions into groups or
"Projects." If answer to question one is yes, you may skip questions
two through seven]
Purchase Approach - Indicate whether the transaction is a NASA or
Contractor Purchase (include contract or contractor name). Also, indicate
if acquisition is competitive, compatibility limited, or sole source.
Purchase Schedule - Indicate purchase schedule ("year" is sufficient for
Level A plans; month or specific date for level B.)
Certification Statements - Each Plan must also explicitly provide the
following certifications signed by the organization CIO and Director in
order to comply with existing regulations & policies:
1. In submitting this I/T Plan, the organizational CIO or Technical
Manager has considered necessary measures for safeguarding
sensitive, personal, and other official Government information.
2. All I/T acquisitions in this I/T Plan are required to
accomplish the mission of this organization.
3. All I/T acquired under this plan will be utilized on site at KSC.
(If not, attach an explanation).
A unique plan number should be assigned to each plan based on the organization
code followed by the date. Further Procurement documents (PRs & SRs) should
reference the plan number and appropriate transaction numbers within your plan.
No I/T resource purchases can proceed unless clearly included in an approved
plan. We recognize that I/T Plans are living documents, and expect some degree
of ongoing change and modification. Additional documentation such as sole source
justifications or software conversion studies will still need to be provided
when appropriate.
Electronic copies of all plans and presentation materials shall be provided to
the CTM in standard MS-Office product format (Word, Excel, PowerPoint, etc.) for
attachment to the Engineering Development Directorate I/T plan.
115
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NAS10-98001 (EDC) Attachment J-2
- --------------------------------------------------------------------------------
ATTACHMENT J-2
Installation-Provided Government Property Listing
The following categories of property are utilized in support of contract
activities:
Electrical Test Equipment
Logic Analyzers
Multimeters
Emulators, In Circuit
Interface Pods
Function Generators
Power Supplies
Oscilloscopes
Decommutators
Time Domain Reflectometers
Data Analysis Systems
Data Loggers
Spectrum Analyzers
Power Control Units
Meg-ohm Meters
Amplifiers
Software Development Systems
Generators
Mechanical Test Equipment
Calibrators, Refrigerator
Load Testers
Dynometers
Hydrostats
Optical Test Equipment
Optical Time Domain Reflectometers
Optical Power Meters
Microscopes
Video Equipment
Digital Cameras
Video Switchs
Video Multiplexers
Camera Stands, Lighted
Image Processing Systems
Computer Projection Systems
Microwave Receivers
VHF/UHF Receivers
Audio Equipment
Microphones
Sound Pressure Meters
Speakers
116
<PAGE> 118
NAS10-98001 (EDC) Attachment J-2
- --------------------------------------------------------------------------------
Optical Equipment
Bar code readers
Lasers
Infrared Cameras
Hand Tools
Calculators
Wrenches/Pliers/Screwdrivers
Measurement Tools
Drills
Saws
Sanders
Electrical Tools
Programmers, Semiconductor
Time Code Generators
Transceivers, Fan-out
Multiprogrammers
Multiplexers
Digital Data Interfaces
Ethernet Multiplexers
Internetwork Bridges
Power Purification Systems
Retransmission Processors
GPS Receivers
Chart Recorders
Mechanical Tools
Robots
Drill Presses
Grinders
Welders
Scales
Vacuum Gauges
Lathes
Bending Machines
Milling Machines
Forming Machines
Power Mitre Boxes
Inclinometers
Mobile Floor Cranes
Impact Wrenches
Hydraulic Pumps
Vacuum Pumps
Paint Spray Equipment
117
<PAGE> 119
NAS10-98001 (EDC) Attachment J-2
- --------------------------------------------------------------------------------
Computers and Associated Peripherals
Mainframe Computers
Computers
Display Monitors
Disk Memory Units
Scanners
Printers
Data Tablet Digitizers
Cassette/Tape Memory Units
Computer Terminals
Feeders, Cut Sheet
Buffer Storage Units
Plotters
Smart Modems
Multispoolers
CAD/CAE I/O Subsystems
Line Printers
Protocol Analyzers
Hyperdrives
Specific items are controlled and tracked utilizing the KSC NEMS (NASA Equipment
Management System) equipment tracking system.
118
<PAGE> 120
NAS10-98001 (EDC) Attachment J-3
- --------------------------------------------------------------------------------
ATTACHMENT J-3
REGISTER OF WAGE DETERMINATION
Page 1 of 10
REGISTER OF WAGE DETERMINATIONS UNDER U.S. DEPARTMENT OF LABOR
THE SERVICE CONTRACT ACT EMPLOYMENT STANDARDS ADMINISTRATION
By direction of the Secretary of Labor WAGE AND HOUR DIVISION
WASHINGTON, DC. 20210
/s/ ALAN L. MOSS Division of Wage Determination No.: 94-2118
Director Wage Determinations Revision No.: 4
Date of Last revision: 09/27/1996
State(s):Florida
Area: FLORIDA COUNTIES OF BREVARD, INDIAN RIVER.
**Fringe Benefits Required For All Occupations Included In
This Wage Determination Follow The Occupational Listing **
OCCUPATION CODE AND TITLE MINIMUM HOURLY WAGE
ADMINISTRATIVE SUPPORT AND CLERICAL:
01011 Accounting Clerk I $ 7.55
01012 Accounting Clerk II $ 8.68
01013 Accounting Clerk III $ 10.25
01014 Accounting Clerk IV $ 12.93
01030 Court Reporter $ 10.78
01050 Dispatcher. Motor Vehicle $ 10.78
01060 Document Preparation Clerk $ 8.40
01090 Duplicating Machine Operator $ 8.40
01110 Film/Tape Librarian $ 11.51
01115 General Clerk I $ 8.58
01116 General Clerk II $ 8.45
01117 General Clerk III $ 9.21
01118 General Clerk IV $ 10.35
01120 Housing Referral Assistant $ 11.65
01131 Key Entry Operator I $ 8.07
01132 Key Entry Operator II $ 9.55
01191 Order Clerk I $ 7.58
01192 Order Clerk II $ 10.31
01220 Order Filler $ 10.25
01261 Personnel Assistant $ 7.77
(Employment) I
01262 Personnel Assistant $ 8.74
(Employment) II
01263 Personnel Assistant $ 9.55
(Employment) III
01264 Personnel Assistant $ 10.72
(Employment) IV
01270 Production Control Clerk $ 11.65
01290 Rental Clerk $ 9.80
01300 Scheduler, Maintenance $ 9.80
01311 Secretary I $ 9.80
01312 Secretary II $ 10.78
01313 Secretary III $ 11.65
01314 Secretary IV $ 13.24
01315 Secretary V $ 14.59
01320 Service Order Dispatcher $ 9.80
01341 Stenographer I $ 9.80
01342 Stenographer II $ 9.80
01400 Supply Technician $ 13.24
01420 Survey Worker(Interviewer) $ 10.78
119
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NAS10-98001 (EDC) Attachment J-3
- --------------------------------------------------------------------------------
WAGE DETERMINATION NO.:94-2118 (Rev. 4) ISSUE DATE:09/27/1996
Page 2 of 10
01460 Switchboard Operator $ 7.30
Receptionist
01510 Test Examiner $ 10.78
01520 Test Proctor $ 10.78
01531 Travel Clerk I $ 7.04
01532 Travel Clerk II $ 7.62
01533 Travel Clerk III $ 8.15
01611 Word Processor I $ 8.30
01612 Word Processor II $ 9.32
01613 Word Processor III $ 10.42
AUTOMATIC DATA PROCESSING:
03010 Computer Data Librarian $ 10.78
03041 Computer Operator I $ 12.59
03042 Computer Operator II $ 13.70
03043 Computer Operator III $ 15.35
03044 Computer Operator IV $ 16.86
03045 Computer Operator V $ 18.80
03071 Computer Programmer I 1/ $ 12.88
03072 Computer Programmer II 1/ $ 15.43
03073 Computer Programmer III 1/ $ 18.66
03074 Computer Programmer IV 1/ $ 20.63
03101 Computer Systems Analyst I l/ $ 19.55
03102 Computer Systems Analyst II 1/ $ 22.99
03103 Computer Systems Analyst III 1/ $ 26.83
03160 Peripheral Equipment Operator $ 10.78
AUTOMOTIVE SERVICE:
05005 Automobile Body Repairer, $ 15.93
Fiberglass
05010 Automotive Glass Installer $ 14.49
05040 Automotive Worker $ 14.49
05070 Electrician, Automotive $ 15.32
05100 Mobile Equipment Servicer $ 13.08
05130 Motor Equipment Metal Mechanic $ 15.93
05160 Motor Equipment Metal Worker $ 14.49
05190 Motor Vehicle Mechanic $ 15.93
05220 Motor Vehicle Mechanic Helper $ 12.31
05250 Motor Vehicle Upholstery $ 13.99
Worker
05280 Motor Vehicle Wrecker $ 14.49
05310 Painter, Automotive $ 15.23
05340 Radiator Repair Specialist $ 14.49
05370 Tire Repairer $ 13.08
05400 Transmission Repair Specialist $ 15.93
FOOD PREPARATION AND SERVICE:
07010 Baker $ 10.73
07041 Cook I $ 9.77
07042 Cook II $ 10.73
07070 Dishwasher $ 7.56
07100 Food Service Worker $ 7.56
(Cafeteria Worker)
07130 Meat Cutter $ 10.73
07250 Waiter/Waitress $ 8.18
120
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NAS10-98001 (EDC) Attachment J-3
- --------------------------------------------------------------------------------
WAGE DETERMINATION NO.:94-2118 (Rev. 4) ISSUE DATE:09/27/1996
Page 3 of 10
FURNITURE MAINTENANCE AND REPAIR:
09010 Electrostatic Spray Painter $ 15.23
09040 Furniture Handler $ 11.97
09070 Furniture Refinisher $ 15.23
09100 Furniture Refinisher Helper $ 12.31
09110 Furniture Repairer, Minor $ 13.80
09130 Upholsterer $ 15.23
GENERAL SERVICES AND SUPPORT:
11030 Cleaner, Vehicles $ 7.56
11060 Elevator Operator $ 7.56
11090 Gardener $ 9.77
11121 Housekeeping Aide I $ 7.56
11122 Housekeeping Aide II $ 8.18
11150 Janitor $ 7.56
11180 Laborer $ 10.67
11210 Laborer, Grounds Maintenance $ 8.18
11240 Maid or Houseman $ 6.64
11270 Pest Controller $ 10.30
11300 Refuse Collector $ 7.56
11330 Tractor Operator $ 9.54
11360 Window Cleaner $ 8.18
HEALTH:
12010 Ambulance Driver $ 10.56
12040 Emergency Medical Technician $ 10.56
12071 Licensed Practical Nurse I $ 7.61
12072 Licensed Practical Nurse II $ 8.54
12073 Licensed Practical Nurse III $ 9.55
12100 Medical Assistant $ 8.54
12130 Medical Laboratory Technician $ 8.54
12160 Medical Record Clerk $ 8.54
12190 Medical Record Technician $ 11.83
12221 Nursing Assistant I $ 6.20
12222 Nursing Assistant II $ 6.97
12223 Nursing Assistant III $ 7.61
12224 Nursing Assistant IV $ 8.54
12250 Pharmacy Technician $ 10.65
12280 Phlebotomist $ 8.54
12311 Registered Nurse I $ 11.83
12312 Registered Nurse II $ 14.47
12313 Registered Nurse III $ 14.47
Specialist
12314 Registered Nurse III $ 17.51
12315 Registered Nurse III $ 17.51
Anesthetist
12316 Registered Nurse IV $ 20.99
INFORMATION AND ARTS:
13002 Audiovisual Librarian $ 16.57
13011 Exhibits Specialist I $ 13.92
13012 Exhibits Specialist II $ 16.57
13013 Exhibits Specialist III $ 18.12
13041 Illustrator I $ 13.92
13042 Illustrator II $ 16.57
13043 Illustrator III $ 18.12
13047 Librarian $ 14.59
121
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NAS10-98001 (EDC) Attachment J-3
- --------------------------------------------------------------------------------
WAGE DETERMINATION NO.:94-2118 (Rev. 4) ISSUE DATE:09/27/1996
Page 4 of 10
13050 Library Technician $ 12.02
13071 Photographer I $ 11.51
13072 Photographer II $ 13.92
13073 Photographer III $ 16.57
13074 Photographer IV $ 18.12
13075 Photographer V $ 20.03
LAUNDRY, DRY CLEANING, PRESSING:
15010 Assembler $ 5.47
15030 Counter Attendant $ 5.47
15040 Dry Cleaner $ 6.71
15070 Finisher, Flatwork, Machine $ 5.47
15090 Presser, Hand $ 5.47
15100 Presser, Machine, Dry Cleaning $ 5.47
15130 Presser, Machine, Shirts $ 5.47
15160 Presser, Machine, Wearing $ 5.47
Apparel, Laundry
15190 Sewing Machine Operator $ 7.12
15220 Tailor $ 7.54
15250 Washer, Machine $ 5.99
MACHINE TOOL OPERATION AND REPAIR:
19010 Machine-tool Operator $ 15.23
(Toolroom)
19040 Tool and Die Maker $ 18.10
MATERIALS HANDLING AND PACKING:
21010 Fuel Distribution System $ 13.99
Operator
21020 Material Coordinator $ 13.80
21030 Material Expediter $ 13.80
21040 Material Handling Laborer $ 6.68
21071 Forklift Operator $ 9.41
21080 Production Line Worker $ 12.25
(Food Processing)
21100 Shipping/Receiving Clerk $ 10.66
21130 Shipping Packer $ 10.21
21140 Store Worker I $ 8.69
21150 Stock Clerk (Shelf Stocker; $ 10.79
Store Worker II)
21210 Tools and Parts Attendant $ 12.31
21400 Warehouse Specialist $ 12.25
MECHANICS AND MAINTENANCE AND REPAIR:
23010 Aircraft Mechanic $ 15.93
23040 Aircraft Mechanic Helper $ 12.31
23060 Aircraft Servicer $ 13.80
23070 Aircraft Worker $ 14.49
23100 Appliance Mechanic $ 15.23
23120 Bicycle Repairer $ 13.08
23125 Cable Splicer $ 15.93
23130 Carpenter, Maintenance $ 15.23
23140 Carpet Layer $ 14.68
23160 Electrician, Maintenance $ 15.93
23181 Electronics Technician, $ 14.08
Maintenance I
23182 Electronics Technician, $ 17.67
Maintenance II
122
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NAS10-98001 (EDC) Attachment J-3
- --------------------------------------------------------------------------------
WAGE DETERMINATION NO.:94-2118 (Rev. 4) ISSUE DATE:09/27/1996
Page 5 of 10
23183 Electronics Technician, $ 19.85
Maintenance III
23260 Fabric Worker $ 13.80
23290 Fire Alarm System Mechanic $ 15.93
23310 Fire Extinguisher Repairer $ 13.08
23340 Fuel Distribution System $ 15.93
Mechanic
23370 General Maintenance Worker $ 14.49
23400 Heating, Refrigeration and Air $ 15.93
Conditioning Mechanic
23430 Heavy Equipment Mechanic $ 15.93
23460 Instrument Mechanic $ 15.93
23500 Locksmith $ 15.23
23530 Machinery Maintenance Mechanic $ 15.93
23550 Machinist, Maintenance $ 17.08
23580 Maintenance Trades Helper $ 12.31
23640 Millwright $ 15.93
23700 Office Appliance Repairer $ 15.23
23740 Painter, Aircraft $ 15.23
23760 Painter, Maintenance $ 15.23
23790 Pipefitter, Maintenance $ 15.93
23800 Plumber, Maintenance $ 15.23
23820 Pneudraulic Systems Mechanic $ 15.93
23850 Rigger $ 15.93
23870 Scale Mechanic $ 14.49
23890 Sheet-metal Worker, $ 15.93
Maintenance
23910 Small Engine Mechanic $ 14.49
23930 Telecommunications Mechanic I $ 15.93
23940 Telecommunications Mechanic II $ 16.66
23950 Telephone Lineman $ 15.93
23960 Welder, Combination, $ 15.93
Maintenance
23965 Well Driller $ 15.93
23970 Woodcraft Worker $ 15.93
23980 Woodworker $ 13.08
PERSONAL NEEDS:
24570 Child Care Attendant $ 7.07
24600 Chore Aide $ 6.64
24630 Homemaker $ 9.80
PLANT AND SYSTEM OPERATION:
25010 Boiler Tender $ 15.93
25040 Sewage Plant Operator $ 15.23
25070 Stationary Engineer $ 15.93
25190 Ventilation Equipment Tender $ 12.11
25210 Water Treatment Plant Operator $ 15.23
PROTECTIVE SERVICE:
27004 Alarm Monitor $ 11.79
27010 Court Security Officer $ 11.79
27040 Detention Officer $ 11.79
27070 Firefighter $ 11.79
27101 Guard I $ 6.67
27102 Guard II $ 11.79
27130 Police Officer $ 13.33
123
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NAS10-98001 (EDC) Attachment J-3
- --------------------------------------------------------------------------------
WAGE DETERMINATION NO.:94-2118 (Rev. 4) ISSUE DATE:09/27/1996
Page 6 of 10
TECHNICAL:
29010 Air Traffic Control 2/ $ 22.77
Specialist, Center
29011 Air Traffic Control 2/ $ 15.71
Specialist, Station
29012 Air Traffic Control 2/ $ 17.29
Specialist, Terminal
29020 Archeological Technician $ 14.79
29030 Cartographic Technician $ 14.79
29035 Computer Based Training $ 19.55
Specialist/Instructor
29040 Civil Engineering Technician $ 14.79
29061 Drafter I $ 8.95
29062 Drafter II $ 11.51
29063 Drafter III $ 13.92
29064 Drafter IV $ 16.57
29070 Embalmer $ 16.57
29081 Engineering Technician I $ 8.95
29082 Engineering Technician II $ 11.51
29083 Engineering Technician III $ 13.92
29084 Engineering Technician IV $ 16.57
29085 Engineering Technician V $ 18.12
29086 Engineering Technician VI $ 20.03
29090 Environmental Technician $ 16.86
29100 Flight Simulator/Instructor $ 22.99
(Pilot)
29150 Graphic Artist $ 19.55
29210 Laboratory Technician $ 15.35
29240 Mathematical Technician $ 14.79
29330 Mortician $ 16.57
29361 Paralegal/Legal Assistant I $ 10.78
29362 Paralegal/Legal Assistant II $ 14.59
29363 Paralegal/Legal Assistant III $ 17.84
29364 Paralegal/Legal Assistant IV $ 21.59
29390 Photooptics Technician $ 14.79
29480 Technical Writer $ 18.96
29620 Weather Observer, Senior 3/ $ 15.35
29621 Weather Observer, Combined 3/ $ 13.82
Upper Air and Surface Programs
29622 Weather Observer, Upper Air 3/ $ 13.82
TRANSPORTATION/MOBILE EQUIPMENT OPERATION:
31030 Bus Driver $ 13.68
31100 Driver Messenger $ 10.57
31200 Heavy Equipment Operator $ 15.93
31260 Parking and Lot Attendant $ 9.60
31290 Shuttle Bus Driver $ 12.97
31300 Taxi Driver $ 10.57
31361 Truckdriver, Light Truck $ 12.97
31362 Truckdriver, Medium Truck $ 13.68
31363 Truckdriver, Heavy Truck $ 14.39
36364 Truckdriver, Tractor-Trailer $ 14.39
MISCELLANEOUS:
99005 Aircraft Quality Control $17.16
Inspector
99020 Animal Caretaker $ 8.70
124
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NAS10-98001 (EDC) Attachment J-3
- --------------------------------------------------------------------------------
WAGE DETERMINATION NO.:94-2118 (Rev. 4) ISSUE DATE:09/27/1996
Page 7 of 10
99030 Cashier $ 5.77
99040 Child Care Center Clerk $ 8.81
99050 Desk Clerk $ 7.07
99260 Instructor $17.25
99300 Lifeguard $ 6.30
99350 Park Attendant (Aide) $ 7.91
99400 Photofinishing Worker ( Photo $ 7.30
Lab / Dark Room Technician)
99500 Recreation Specialist $13.64
99510 Recycling Worker $ 9.19
99610 Sales Clerk $ 6.30
99630 Sports Official $ 6.30
99658 Survey Party Chief $ 9.77
99659 Surveying Technician $ 7.91
99660 Surveying Aide $ 5.77
99690 Swimming Pool Operator $10.73
99720 Vending Machine Attendant $ 9.19
99730 Vending Machine Repairer $10.73
99740 Vending Machine Repairer $ 9.19
Helper
-------------------------------------------------------------------------
** Fringe Benefits Required For All Occupations Included
In This Wage Determination**
HEALTH & WELFARE: Life, accident, and health insurance plans, sick leave,
pension plans, civic and personal leave, and savings and thrift plans. Minimum
employer contributions costing an average of $2.56 per hour computed on the
basis of all hours worked by service employees employed on the contract. May
include such benefits as severance pay.
VACATION: 2 weeks paid vacation after 1 year of service with a contractor or
successor; 3 weeks after 5 years; 4 weeks after 15 years; and 5 weeks after 20
years. Length of service includes the whole span of continuous service with the
present contractor or successor, wherever employed, and with predecessor
contractors in the performance of similar work at the same Federal facility.
(Reg. 4.173)
HOLIDAYS: Minimum of ten paid holidays per year: New Year's Day,
Martin Luther King Jr.'s Birthday, Washington's Birthday, Memorial Day,
Independence Day, Labor Day, Columbus Day, Veterans' Day, Thanksgiving Day, and
Christmas Day. (A contractor may substitute for any of the named holidays
another day off with pay in accordance with a plan communicated to the employees
involved.) (See 29 CFR 4.174) 1/
Does not apply to employees employed in a bona fide executive, administrative,
or professional capacity as defined and delineated in 29 CFR 541. (See 29 CFR
4.156) 2/
APPLICABLE TO AIR TRAFFIC CONTROLLERS ONLY - NIGHT DIFFERENTIAL: An employee is
entitled to pay for all work performed between the hours of 6:00 P.M. and 6:00
A.M. at the rate of basic pay plus a night pay differential amounting to 10
percent of the rate of basic pay.
125
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NAS10-98001 (EDC) Attachment J-3
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WAGE DETERMINATION NO.:94-2118 (Rev. 4) ISSUE DATE:09/27/1996
3/ Page 8 of 10
APPLICABLE TO WEATHER OBSERVERS ONLY - NIGHT PAY & SUNDAY PAY: If you work at
night as a part of a regular tour of duty, you will earn a NIGHT DIFFERENTIAL
and receive an additional 10% of basic pay for any hours worked between 6pm and
6am. If you are a fulltime employee (40 hours a week) and Sunday is part of your
regularly scheduled workweek, you are paid at your rate of basic pay plus a
Sunday premium of 25% of your basic rate for each hour of Sunday work which is
not overtime (i.e. occasional work on Sunday outside the normal tour of duty is
considered overtime work).
** UNIFORM ALLOWANCE **
If employees are required to wear uniforms in the performance of this contract
(either by the terms of the Government contract, by the employer, by the state
or local law, etc.), the cost of furnishing such uniforms and maintaining (by
laundering or dry cleaning) such uniforms is an expense that may not be borne by
an employee where such cost reduces the hourly rate below that required by the
wage determination. The Department of Labor will accept payment in accordance
with the following standards as compliance:
The contractor or subcontractor is required to furnish all employees with an
adequate number of uniforms without cost or to reimburse employees for the
actual cost of the uniforms. In addition, where uniform cleaning and maintenance
is made the responsibility of the employee, all contractors and subcontractors
subject to this wage determination shall (in the absence of a bona fide
collective bargaining agreement providing for a different amount, or the
furnishing of contrary affirmative proof as to the actual cost), reimburse all
employees for such cleaning and maintenance at a rate of $4.2 5 per week (or
$.85 cents per day). However, in those instances where the uniforms furnished
are made of "wash and wear" materials, may be routinely washed and dried with
other personal garments, and do not require any special treatment such as dry
cleaning, daily washing, or commercial laundering in order to meet the
cleanliness or appearance standards set by the terms of the Government contract,
by the contractor, by law, or by the nature of the work, there is no requirement
that employees be reimbursed for uniform maintenance costs.
** NOTES APPLYING TO THIS WAGE DETERMINATION **
Source of Occupational Titles and Descriptions:
The duties of employees under job titles listed are those described in the
"Service Contract Act Directory of Occupations," Fourth Edition, January 1993,
as amended by the Second Supplement, dated August 1995, unless otherwise
indicated. This publication may be obtained from the Superintendent of
Documents, at 202-783-3238, or by writing to the Superintendent of Documents,
U.S. Government Printing Office, Washington, D.C. 20402. Copies of specific job
descriptions may also be obtained from the appropriate contracting officer.
126
<PAGE> 128
NAS10-98001 (EDC) Attachment J-3
- --------------------------------------------------------------------------------
WAGE DETERM[NATION NO.:94-21 18 (Rev. 4) ISSUE DATE:09/27/1996
Page 9 of 10
REQUEST FOR AUTHORIZATION OF ADDITIONAL CLASSIFICATION AND WAGE RATE (Standard
Form 1444 (SF 1444))
Conformance Process:
The contracting officer shall require that any class of service employee which
is not listed herein and which is to be employed under the contract (i.e., the
work to be performed is not performed by any classification listed in the wage
determination), be classified by the contractor so as to provide a reasonable
relationship (i.e., appropriate level of skill comparison) between such unlisted
classifications and the classifications listed in the wage determination. Such
conformed classes of employees shall be paid the monetary wages and furnished
the fringe benefits as are determined. Such conforming process shall be
initiated by the contractor prior to the performance of contract work by such
unlisted class(es) of employees. The conformed classification, wage rate, and/or
fringe benefits shall be retroactive to the commencement date of the contract.
{See Section 4.6 (C)(vi)} When multiple wage determinations are included in a
contract, a separate SF 1444 should be prepared for each wage determination to
which a class(es) is to be conformed.
The process for preparing a conformance request is as follows:
1) When preparing the bid, the contractor identifies the need for a conformed
occupation(s) and computes a proposed rate(s).
2) After contract award, the contractor prepares a written report listing in
order proposed classification title(s), a Federal grade equivalency (FGE) for
each proposed classification(s), job description(s), and rationale for proposed
wage rate(s), including information regarding the agreement or disagreement of
the authorized representative of the employees involved, or where there is no
authorized representative, the employees themselves. This report should be
submitted to the contracting officer no later than 30 days after such unlisted
class(es) of employees performs any contract work.
3) The contracting officer reviews the proposed action and promptly submits a
report of the action, together with the agency's recommendations and pertinent
information including the position of the contractor and the employees, to the
Wage and Hour Division, Employment Standards Administration, U.S. Department of
Labor, for review. (See section 4.6(b)(2) of Regulations 29 CFR Part 4).
4) Within 30 days of receipt, the Wage and Hour Division approves, modifies, or
disapproves the action via transmittal to the agency contracting officer, or
notifies the contracting officer that additional time will be required to
process the request.
5) The contracting officer transmits the Wage and Hour decision to the
contractor.
6) The contractor informs the affected employees.
Information required by the Regulations must be submitted on SF 1444 or bond
paper.
When preparing a conformance request, the "Service Contract Act Directory
of Occupations" (the Directory) should be used to compare job definitions to
insure that duties requested are not performed
127
<PAGE> 129
NAS10-98001 (EDC) Attachment J-3
- --------------------------------------------------------------------------------
WAGE DETERMINATION NO.:94-21 18 (Rev, 4) ISSUE DATE:09/27/1996
Page 10 of 10
by a classification already listed in the wage determination. Remember, it is
not the job title, but the required tasks that determine whether a class is
included in an established wage determination. Conformances may not be used to
artificially split, combine, or subdivide classifications listed in the wage
determination.
128
<PAGE> 130
NAS10-98001 (EDC) Attachment J-4
- --------------------------------------------------------------------------------
ATTACHMENT J-4
EDC AWARD FEE EVALUATION PLAN
1. Introduction
------------
A. Purpose
The purpose of the Award Fee Plan is to encourage and reward the
Contractor for safe, high quality, cost-conscious performance in
fulfilling the requirements set forth in this contract; to provide
flexibility for changes in management and performance emphasis; and to
promote effective communications.
The use of award fee permits the Government to focus on overall
technical and cost performance and to emphasize those aspects of
critical milestone achievements essential to reach mission objectives.
B. Award Fee Determinations
Award fee determinations, up to the maximum potential amounts
specified in the contract schedule, will be made by the Fee
Determination Official (FDO). Award fee determinations will be based
on both objective metrics and subjective judgments by the Government
of the Contractor's performance using procedures and evaluation
criteria as specified in this Award Fee Plan.
2. Evaluation Procedure
--------------------
For the purpose of award fee determinations on this contract, the procedure
indicated below will be followed.
A. General
(I) Award fee will be determined annually by the Fee Determination
Official who is Chairperson of the Contract Award Fee Board
(CAFB). The CAFB is comprised of the FDO, the Engineering
Development Director, other line management directors, the
Director of Safety and Mission Assurance, the Procurement Officer
or Deputy, and the KSC Chief Financial Officer or designee.
(2) The award fee will be determined based upon a review by the CAFB
of the consolidated recommendation prepared by the Contract
Technical Manager (CTM), the Contracting Officer (CO), and the
Contractor's additional data, if any.
(3) The CTM will be the focal point for the accumulation and
development of award fee evaluation reports, reviews, and
presentations as well as discussions with Contractor management on
award fee matters.
(4) The determination of award fee shall be unilateral and shall not
be subject to the Disputes clause of the contract.
129
<PAGE> 131
NAS10-98001 (EDC) Attachment J-4
- --------------------------------------------------------------------------------
B. Reviews
The Contractor's performance will be reviewed in the manner described
below.
(1) Concurrent - Contractor performance levels which require remedial
attention or which may be expected to adversely affect award fee
ratings will be made known to the Contractor by the CTM (either
orally or in writing) on a current basis.
(2) Quarterly - A quarterly review of the Contractor's performance
will be held by the CTM with cognizant evaluators. The substance
of this quarterly review will be summarized in writing and a copy
transmitted to the Contractor.
(3) Annually - Within thirty (30) calendar days following each
performance period, the CTM will prepare a report on the
evaluation of the Contractor's performance. The Contractor will be
furnished a copy of the report without an adjective rating or
numerical score assigned for the period. Within ten (10) calendar
days from receipt of the evaluation report, the Contractor may, if
so desired, submit in writing to the CTM additional data bearing
on the performance evaluation. The Contractor's comments, if any,
will be included in the final report to the CAFB. The Contractor
may also request an opportunity to give a presentation to the CAFB
concerning his performance.
3. Fee Determination
-----------------
A. The CAFB will convene to review the award fee evaluation report,
Contractor's comments, and such other information as may be
appropriate. After consideration of this data, the CAFB will assist
the FDO in determining an appropriate amount of award fee.
B. The FDO will notify the Contracting Officer in writing of the amount
of award fee, if any, determined to have been earned during the
evaluation period. The Contracting Officer will notify the Contractor
of such determination. This determination is not subject to appeal
under the Disputes clause or any other provision of the contract.
C. Following notification of the award fee determination, the Contacting
Officer will issue a modification to the contract.
4. Evaluation Criteria
A. Evaluation criteria encompass the safety, quality, timeliness,
efficiency, and cost effectiveness of the Contractor's performance of
contract requirements. Appropriate areas of emphasis will be established
for each evaluation period emphasizing effective accomplishment of
contract activities and mission success. The specific areas of directed
emphasis will be identified and communicated to the Contractor at least
fifteen (15) days prior to the start of the evaluation period by the
Contracting Officer.
130
<PAGE> 132
B. The Contracting Officer may notify the Contractor at a later date of
alterations in areas of emphasis (including additions or deletions).
Such alterations will be prospective and will allow the Contractor
time to react or implement the alterations.
5. Numerical Ranges/Adjective Definitions and Award Fee Scale
Exhibits to this Plan set forth the adjective ratings, definitions, and
associated numerical ranges to be used to define the various levels of
performance under the contract. The Award Fee Scale sets forth in tabular
form the award fee earned at various performance ratings.
131
<PAGE> 133
SCHEDULE 1
----------
NUMERICAL RANGES /ADJECTIVE DEFINITIONS
---------------------------------------
NUMERI
CAL ADJECTIVE
RANGE RATING ADJECTIVE DEFINITIONS
----- --------- ---------------------
91 - 100 EXCELLENT The Contractor's overall performance
of contract requirements is of
exceptional merit marked by timely,
efficient, and economical performance.
Exemplary performance in all areas of
directed emphasis. Very minor
deficiencies with no adverse effect on
overall performance.
81 - 90 VERY GOOD The Contractor is exhibiting very
effective performance and is fully
responsive to contract requirements.
Majority of performance requirements
are timely, efficient, and economically
conducted. Only minor deficiencies
are noted.
71 - 80 GOOD The Contractor is performing
effectively and is fully responsive to
contract requirements. There are
reportable deficiencies which have
minor identifiable effect on overall
contract performance.
61 - 70 SATISFACTORY The Contractor meets or slightly
exceeds the minimum acceptable
contract requirements with adequate
results. There are reportable
deficiencies with identifiable, but not
substantial, effects on overall contract
performance.
60 AND UNSATISFACTORY The Contractor does not meet
BELOW minimum acceptable standards,
requires remedial action, or
has deficiencies in one or
more areas that adversely
affect overall contract
performance.
132
<PAGE> 134
SCHEDULE 2
AWARD FEE SCALE
--------- -----
NUMERICAL % AVAILABLE
ADJECTIVES SCORE AWARD FEE
---------- ----- ---------
100 100
99 99
98 98
97 97
96 96
EXCELLENT 95 95
94 94
93 93
92 92
91 91
- -----------------------------------------------------------------------------
90 90
89 89
88 88
87 87
86 86
VERY GOOD 85 85
84 84
83 83
82 82
81 81
- -------------------------------------------------------------------------------
80 80
79 79
78 78
77 77
76 76
GOOD 75 75
74 74
73 73
72 72
71 71
- --------------------------------------------------------------------------------
70 70
69 69
68 68
67 67
66 66
SATISFACTORY 65 65
64 64
63 63
62 62
61 61
- --------------------------------------------------------------------------------
60 0
59 0
UNSATISFACTORY * *
* *
0 0
133
<PAGE> 135
NAS10-98001 (EDC) Attachment J-5
- --------------------------------------------------------------------------------
ATTACHMENT J-5
GLOSSARY, ACRONYMS, AND ABBREVIATIONS
-------------------------------------
AC Alternating Current
ACN Activity Classification Number
ADP Acceptance Data Package
AGE Aerospace Ground Equipment
ANSI American National Standards Institute
ASQC American Society for Quality Control
ATM Asynchronous Transfer Mode
ATP Acceptance Test Procedure
BOC Base Operations Contractor
CAD Computer-Aided Design
CAE Computer-Aided Engineering
CAFB Contract Award Fee Board
CBT Computer-Based Training
CCAS Cape Canaveral Air Station
CCD Charge-Coupled Device
CCS Complex Control System
CDP Contract Data Package
CFO Chief Financial Officer
CFR Code of Federal Regulations
CI Continual Improvement
CIAO Central Industry Assistance Office
CIF Central Instrumentation Facility
CLIX Clipper Unix Operating System
CIO Chief Information Officer
CMU Checkout and Monitor Unit
CO Contracting Officer
COTR Contracting Officer's Technical Representative
COTS Commercial-Off-the-Shelf
CPAF Cost-Plus-Award-Fee
CPIC Configurable Protocol Interface Card
CPM Critical Path Method
CPU Central Processing Unit
CRCA Component Refurbishment and Chemical Analysis
CSD Contract Start Date
CTM Contract Technical Manager
CY Contract Year
134
<PAGE> 136
NAS10-98001 (EDC) Attachment J-5
- --------------------------------------------------------------------------------
DC Direct Current
DCAA Defense Contract Audit Agency
DCR Document Change Recommendation
DE Engineering Development Directorate
DFRC Dryden Flight Research Center
DMES Dimethylethoxysilane
DPI Data Processing Installation
DoD Department of Defense
DoL Department of Labor
DRA Document Release Authorization
DRD Data Requirements Description
DRFP Draft Request for Proposal
DRL Data Requirements List
ECSL Electrical Control Systems Laboratory
EDC Engineering Development Contract
EDL Engineering Development Laboratory
EEE Electronic, Electrical, Electromechanical
EEO Equal Employment Opportunity
EPA Environmental Protection Agency
ER Eastern Range
EST Eastern Standard Time
ET External Tank
EVS Equipment Visibility System
F&GS Fluids and Gases Subsystem
FAR Federal Acquisition Regulation
FDO Fee Determination Official
FED-STD Federal Telecommunication Standards
FICA Federal Insurance Contributions Act
FIP Federal Information Processing
FMEA Failure Modes and Effects Analysis
FOTV Fiber-Optic Television System
FRIV Fast Response Instrumentation Van
ft Foot/Feet
FTE Full-Time Equivalent
FTIR Fourier Transform Infrared Spectrophotometer
FUI Federal Unemployment Insurance
FY Fiscal Year
G&A General and Administrative
GAO General Accounting Office
GFE Government Furnished Equipment
GFP Government Furnished Property
GH2 Gaseous Hydrogen (also GH2)
135
<PAGE> 137
NAS10-98001 (EDC) Attachment J-5
- --------------------------------------------------------------------------------
GIDEP Government Industry Data Exchange Program
GN2 Gaseous Nitrogen (also GN2)
GOP Government Organization Provisions
GOX Gaseous Oxygen
GP General Publication
gpm Gallons Per Minute
GPS Global Positioning System
GSBCA General Services Administration Board of Contract
Appeals
GSE Ground Support Equipment
GTR Government Transportation Request
H20 Water
HCl Hydrogen Chloride
HDP Holddown Post
HEPA High Efficiency Particle Air (Filter)
HGDS Hazardous Gas Detection System
hp horsepower
HUMS Hydrogen Umbilical Mass Spectrometer
HVAC Heating, Ventilation and Air Conditioning
Hz Hertz (cycles per second)
ID Implementing Directive
IEEE Institute of Electronic and Electrical Engineers
IR Infrared
IRM Information Resources Management
Information Resources Manager
IRS Internal Revenue Service
ISO International Organization for Standardization
I/T Information Technology (also IT)
IVAN Instrumentation Van
JSC Johnson Space Center
KHB Kennedy Space Center Handbook
KMI Kennedy Space Center Management Instruction
KSC Kennedy Space Center
KSCAP Kennedy Space Center Area Permits
KSCM Kennedy Space Center Manual
LC-39 Launch Complex 39
LCC Launch Control Center
LETF Launch Equipment Test Facility
LH2 Liquid Hydrogen (also LH2)
LN2 Liquid Nitrogen (also LN2)
L02 Liquid Oxygen (also L02)
136
<PAGE> 138
NAS10-98001 (EDC) Attachment J-5
- --------------------------------------------------------------------------------
LOS Length of Stain (HCL dosimeter)
Lift-Off Simulator
LPS Launch Processing System
LSGMS Launch Site Ground Support Equipment Management System
M&A Management and Administration
MDS&DS McDonnell Douglas Aerospace Space and Defense Systems
MER Maximum Error Rate
MHz Megahertz (megacycles per second)
MIHF Multi-spectral Imaging of Hydrogen Flames
MIL-STD Military Standard
MKTM Mobile Kineto Tracking Mount
MLP Mobile Launcher Platform
MPLM Mini Payload Logistics Module
MR Procurement Request
MS Microsoft Corporation
MSBLS Microwave Scanning Beam Landing System
MSC Material Service Centers
MS-DOS Microsoft Corporation Disk Operating System
MSFC Marshall Space Flight Center
N204 Nitrogen Tetroxide
NO2 Nitrogen Dioxide
NASA National Aeronautics and Space Administration
NEMS NASA Equipment Management System
NEPA National Environmental Policy Act
NFS NASA Federal Acquisition Regulation Supplement
NHB NASA Handbook
NIST National Institute of Standards and Technology
NMI NASA Management Instruction
NOTU Naval Ordnance Test Unit
NSTS National Space Transportation System
NTE Not To Exceed
NVR Nonvolatile Residue
O&C Operations and Checkout Building
OAA Orbiter Access Arm
OCR Optical Character Recognition
ODC Other Direct Costs
ODMS Oxygen Deficiency Monitoring System
OIS Operational Intercommunication System
OIS--A Operational Intercommunication System--Analog
OIS--D Operational Intercommunication System--Digital
OMD Operations and Maintenance Documentation
OMI Operations and Maintenance Instruction
OMRD Operations and Maintenance Requirements Document
137
<PAGE> 139
NAS10-98001 (EDC) Attachment J-5
- --------------------------------------------------------------------------------
OPF Orbiter Processing Facility
OPR Office of Primary Responsibility
OS Operating System
OSHA Occupational Safety and Health Administration
OTV Operational Television
PA&FB Payroll Additives and Fringe Benefits
PAFB Patrick Air Force Base
PAMS Portable Aft Mass Spectrometer
PAWS Paging and Area Warning System
PC Personal Computer
PCN Project Control Number
PCO Project Control Office
PERT Program Evaluation Review Technique
PGHM Payload Ground Handling Mechanism
PIC Pyrotechnic Initiator Controller
PLC Programmable Logic Controller
PLTS Precision Laser Tracking System
PME Pulse Modulation Encoder
PMI Periodic Maintenance Instruction
PMS Permanent Measurement System
POCS Photo--Optical Control System
ppb parts per billion
PPCU Partial Payloads Checkout Unit
ppm parts per million
PR Purchase Request
PRACA Problem Reporting and Corrective Action
psig Pounds Per Square Inch Gauge
PWS Performance Work Statement
QA Quality Assurance
R&D Research and Development
RCC Reinforced Carbon--Carbon
RCCOST Reinforced Carbon--Carbon Optical Scanning Tool
RF Radio Frequency
RFIC Request For Issuance Clearance
RFP Request for Proposal
RID Rack Insertion Device
RMAS Remote Monitor Alarm System
RMO Resources Management Office
RMS Random Motion Simulator
ROS Research Operations Support
S&MA Safety and Mission Assurance
SAA System Assurance Analysis
138
<PAGE> 140
NAS10-98001 (EDC) Attachment J-5
- --------------------------------------------------------------------------------
SBA Small Business Administration
SDB Small Disadvantaged Business
SEB Source Evaluation Board
SF Standard Form
SIC Standard Industrial Classification
slpm standard liters per minute
SONET Synchronous Optical Network
SOP Standard of Performance
SPP Standard Practice Procedure
Sq Square
SR&QA Safety, Reliability and Quality Assurance
SRB Solid Rocket Booster
SRM&QA Safety, Reliability, Maintainability and Quality
Assurance
SRMU Solid Rocket Motor Upgrade
SSA Source Selection Authority
SSC Stennis Space Center
SSE Software Support Environment
SSPF Space Station Processing Facility
SSR Safety Statistics Report
STS Space Transportation System
SUI State Unemployment Insurance
SURDA Surface Defect Analysis
TACAN Tactical Air Navigation
TAL Transatlantic Abort Landing
Transoceanic Abort Landing
TBD To Be Determined
TC Technical Contact
TCMS Test, Control, and Monitor System
TCMS--E Test, Control, and Monitor System--Ethernet
TCS Tracker Control System
TD Technical Directive
TFCS Treasury Financial Communications System
TIM Technical Interchange Meeting
TIN Taxpayer Identification Number
TLV Threshold Limit Value
TPO DE Technology Programs and Commercialization Office
TR Technical Representative
TSM Tail Service Mast
TV Television
TVD Toxic Vapor Detector
UCC Universal Checkout Console
UCS Unified Control System
UPN Unique Project Number
139
<PAGE> 141
NAS10-98001 (EDC) Attachment J-5
- --------------------------------------------------------------------------------
US United States
USAF United States Air Force
USCA Universal Signal Conditioning Amplifier
uv ultraviolet
V Volts
V&V Verification and Validation
VAC Volts, Alternating Current
VAFB Vandenberg Air Force Base
Vdc Volts, Direct Current
VME Versa Module Europe
VPF Vertical Processing Facility
VXI VME Extension Interface
WO Work Order
WSTF White Sands Test Facility
140
<PAGE> 142
NAS10-98001 (EDC) Attachment J-6
- --------------------------------------------------------------------------------
ATTACHMENT J-6
DD FORM 254
(CONTRACT SECURITY CLASSIFICATION SPECIFICATION)
141
<PAGE> 143
DEPARTMENT OF DEFENSE
CONTRACT SECURITY CLASSIFICATION SPECIFICATION
(The requirements of the National Industrial Security Program Operating Manual
apply to all security aspects of this effort)
- --------------------------------------------------------------------------------
1. CLEARANCE AND SAFEGUARDING
- --------------------------------------------------------------------------------
a. FACILITY CLEARANCE REQUIRED
Secret
- --------------------------------------------------------------------------------
b. LEVEL OF SAFEGUARDING REQUIRED
None
- --------------------------------------------------------------------------------
2. THIS SPECIFICATION IS FOR: (x and complete as applicable)
- --------------------------------------------------------------------------------
|X| a. PRIME CONTRACT NUMBER
NAS10-98001
- --------------------------------------------------------------------------------
| | b. SUBCONTRACT NUMBER
- --------------------------------------------------------------------------------
| | c. SOLICIATION OR OTHER NUMBER DUE DATE (YY/MM/DD)
- --------------------------------------------------------------------------------
3. THIS SPECIFICATION IS: (X and complete as applicable)
- --------------------------------------------------------------------------------
|X| a. ORIGINAL (Compare date in all cases) Date (YYMMDD)
- --------------------------------------------------------------------------------
| | b. REVISED (Supersedes all previous pages) Revision No. Date (YYMMDD)
- --------------------------------------------------------------------------------
| | c . FINAL (Complete item 5 in all Cases Date (YYMMDD)
- --------------------------------------------------------------------------------
4. IS THIS A FOLLOW-ON CONTRACT? |_|YES |X| NO
Classified material received or generated under_____ (Preceding Contract Number)
is transferred to this follow-on contract
- --------------------------------------------------------------------------------
5. Is THIS A FINAL DD FORM 254? |_YES |X| NO, If yes, complete the following
In response to the contractors request dated____, retention of the identified
classified material is authorized for a period of:
- --------------------------------------------------------------------------------
6. CONTRACTOR (Include Commercial and Government Entry Code)
- --------------------------------------------------------------------------------
a. NAME, ADDRESS, AND ZIP
Dynacs Engineering Company, Inc.
28870 U.S. Highway 19, W.
Clearwater, FL 34621-2596
- --------------------------------------------------------------------------------
b. CAGE CODE
OAVB3
- --------------------------------------------------------------------------------
c. COGNIZANT SECURITY OFFICE (Name, Address, Zip)
SoutheastRegion, DIS
2300 Lake Park Drive
Suite 250
Smyrna, GA 30080-7606
- --------------------------------------------------------------------------------
7. SUBCONTRACTOR
- --------------------------------------------------------------------------------
a. NAME, ADDRESS. AND ZIP
b. CAGE CODE
c. COGNIZANT SECURITY OFFICE
- --------------------------------------------------------------------------------
8. ACTUAL PERFORMANCE
- --------------------------------------------------------------------------------
a. LOCATION
b. CAGE CODE
c. COGNIZANT SECURITY OFFICE (Name, Address, and Zip code)
- --------------------------------------------------------------------------------
GENERAL IDENTIFICATION OF THIS PROCUREMENT
- --------------------------------------------------------------------------------
10.THIS CONTRACT WILL REQUIRE ACCESS TO
a. COMMUNICATIONS SECURITY (COMSEC) INFORMATION YES |_| NO |X|
b. RESTRICTED DATA YES |_| NO |X|
c. CRITICAL NUCLEAR WEAPON DESIGN INFORMATION YES |_| NO |X|
d. FORMERLY RESTRICTED DATA YES |_| NO |X|
e. INTELLIGENCE INFORMATION
(1) Sensitive Compartmented Information (SCI) YES |_| NO |X|
(2) Non-SCI YES |_| NO |X|
f. SPECIAL ACCESS INFORMATION YES |_| NO |X|
g. NATO INFORMATION YES |_| NO |X|
h. FOREIGN GOVERNMENT INFORMATION YES |_| NO |X|
i. LIMITED DISSEMINATION INFORMATION YES |_| NO |X|
j. FOR OFFICIAL USE ONLY INFORMATION YES |_| NO |X|
k. OTHER (Specify) YES |X| NO |_|
- --------------------------------------------------------------------------------
11. IN PERFORMING THIS CONTRACT THE CONTRACTOR WILL:
- --------------------------------------------------------------------------------
a. HAVE ACCESS TO CLASSIFIED INFORMATION ONLY AT
ANOTHER CONTRACTORS FACILITY ON GOVERNMENT ACTIVITY YES |X| NO |_|
b. RECEIVE CLASSIFIED DOCUMENTS ONLY YES |_| NO |X|
c. RECEIVE AND GENERATE CLASSIFIED MATERIAL YES |_| NO |X|
d. FABRICATE, MODIFY, OR STORE CLASSIFIED HARDWARE YES |_| NO |X|
e. PERFORM SERVICES ONLY YES |_| NO |X|
f. HAVE ACCESS TO U.S. CLASSIFIED INFORMATION OUTSIDE
THE U.S. , PUERTO RICO, U.S. POSSESSIONS AND TRUST
TERRITORIES YES |_| NO |X|
g. BE AUTHORIZED OT USE THE SERVICES OF THE DEFENSE
TECHNICAL INFORMATION CENTER (DTIC) OR OTHER SECONDARY
DISTRIBUTION CENTER YES |_| NO |X|
h. REQUIRE A COMSEC ACCOUNT YES |_| NO |X|
i. HAVE TEMPEST REQUIREMENTS YES |_| NO |X|
j .HAVE OPERATIONS SECURITY (OPSEC) REQUIREMENTS YES |_| NO |X|
k. BE AUTHORIZED TO USE THE DEFENSE COURIER SERVICE YES |_| NO |X|
l. OTHER (specify)
SEE BLOCK 13 REMARKS
- --------------------------------------------------------------------------------
DD FORM 254-E, JAN 95
Previous editions are obsolete
<PAGE> 144
12. PUBLIC RELEASE. Any information (classified or unclassified) pertaining to
this contract shall not be released for public dissemination except as provided
in the Industrial Security Manual or unless it has been approved for public
release by appropriate U.S. Government authority. Proposed public releases shall
be submitted prior to release. |_| DIRECT |X| THROUGH (Specify)
NASA John F. Kennedy Space Center
ATTN: PA-PIB
Kennedy Space Center. FL 32899
to the Directorate for Freedom of Information and Security Review, Office of the
Assistant Secretary of Defense (Public Affairs)* for review.
*In the case of non-DoD User Agencies, requests for disclosure shall be
submitted to that agency.
- --------------------------------------------------------------------------------
13. SECURITY GUIDANCE. The security classification guidance needed for this
classified effort is identified below. If any difficulty is encountered in
applying this guidance or if any other contributing factor indicates any changes
in this guidance, the contractor is authorized and encouraged to provide the
recommended changes; to challenge the guidance of the classification assigned to
any information or material furnished or generated under this contract, submit
any question for interpretation of this guidance to the official identified
below. Pending that decision, the information involved shall be handled and
protected at the highest level of classification assigned or recommended. (F???
appropriate for the classified effort. Attach or forward under separate
correspondence any documents/guides/extracts referenced herein. Add additional
pages as needed to provide complete guidance.)
The Space-Transportation System Security Classification Guide, current and
subsequent versions shall be a part of this contract. Guide will be provided
under separate cover.
Additional classification guidance will be provided as required under separate
cover.
- --------------------------------------------------------------------------------
14. ADDITIONAL SECURITY REQUIREMENTS. Requirements in addition to NISPOM
requirements are established for this contract. (If Yes, identify the pertinent
contractual clauses in the contract document itself, or provide an appropriate
statement which identifies additional requirements. Provide a copy of the
requirements to the cognizant security office. Use Item 13 if additional space
is required) |X| YES |_| NO
NASA KSC documents apply on KSC
- --------------------------------------------------------------------------------
15. INSPECTIONS ELEMENTS OF THIS CONTRACT ARE OUTSIDE THE INSPECTION
RESPONSIBILITY OF THE COGNIZANT SECURITY OFFICE. (If yes, explain and identify
specific areas or elements carved out and the activity responsible for
inspections. Use
Item 13 if more space is needed. |X| YES |_| NO
Inspection cognizance of activities at the Kennedy Space Center is the
responsibility of NASA/KSC Protective Services Office.
- --------------------------------------------------------------------------------
16. CERTIFICATION AND SIGNATURE. Security requirements stated herein are
complete and adequate for safeguarding the classified information to be released
or generated under this classified effort. All questions shall be referred to
the official named below.
- --------------------------------------------------------------------------------
a. TYPED NAME OF CERTIFYING OFFICIAL
Michael L. Bross
- --------------------------------------------------------------------------------
b. TITLE
Manager, Information Security
- --------------------------------------------------------------------------------
c. TELEPHONE (Include Area Code)
(407) 867-2452
- --------------------------------------------------------------------------------
d. ADDRESS (Included Zip Code)
Kennedy Space Center
Attn: FF-S1-B
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
e. SIGNATURE
/S/MICHAEL L. BROSS
---------------------
- --------------------------------------------------------------------------------
17. REQUIRED DISTRIBUTION
- --------------------------------------------------------------------------------
|X| a. CONTRACTOR
|_| b. SUBCONTRACTOR
|X| c. COGNIZANT SECURITY OFFICE FOR PRIME AND SUBCONTRACTOR
|_| d. U.S. ACTIVITY RESPONSIBLE FOR OVERSEAS SECURITY ADMINISTRATION
|X| e. ADMINISTRATIVE CONTRACTING OFFICER
|X| f. OTHERS AS NECESSARY FF-S1-B
- --------------------------------------------------------------------------------
DD Form 254-E, Reverse, JAN 95
<PAGE> 145
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
1
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-1
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 North, Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/400000/34/97/PF Increase $1,315,636.00 MR 971003 S-1
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
Incremental funding is increased by $1,315,636.00 as reflected in the
revised Article B-12, Contract Funding, Table B-12. The funds are
estimated to be adequate through November 17, 1997, per contractor
memorandum of September 30, 1997.
Replacement page 13 is attached and should be appropriately inserted in
copies of the contract.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Michael S. McCarty
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/MICHAEL S. MCCARTY 9-30-97
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 146
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
2
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-2
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 North, Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/400000/34/98/PF Increase $4,800.00
CW-1/2590C/400000/34/98/PF Increase $926,000.00
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
Incremental funding is increased by $930,800.00 as reflected in the
revised Article B-12, Contract Funding, Table B-12. The funds are
estimated to be adequate through December 10, 1997, per contractor
memorandum of October 10, 1997.
Replacement page 13 is attached and should be appropriately inserted in
copies of the contract.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Michael S. McCarty Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /s/ Bob R. Pirkle 10-10-97
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 147
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
3
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-3
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 North, Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/400000/34/98/PF Increase $1,153,947.00
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
Incremental funding is increased by $1,153,947.00 as reflected in the
revised Article B-12, Contract Funding, Table B-12. The funds are
estimated to be adequate through January 3, 1998, per contractor
memorandum of October 29, 1997.
Replacement page 13 is attached and should be appropriately inserted in
copies of the contract.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /s/ Bob R. Pirkle 10-29-97
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 148
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
4
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-4
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 North, Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/400000/34/97/PF Increase $376,614.00
CW-1/2590C/400000/34/98/PF Increase $2,570,121.00
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
Incremental funding is increased by $2,946,735.00 as reflected in the
revised Article B-12, Contract Funding, Table B-12. The funds are
estimated to be adequate through March 5, 1998, per contractor
memorandum of November 21,1997.
Replacement page 13 is attached and should be appropriately inserted in
copies of the contract.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Michael S. McCarty
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/MICHAEL S. MCCARTY 11-21-97
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 149
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
4
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-4
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 North, Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/400000/34/97/PF Increase $376,614.00
CW-1/2590C/400000/34/98/PF Increase $2,570,121.00
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
Incremental funding is increased by $2,946,735.00 as reflected in the
revised Article B-12, Contract Funding, Table B-12. The funds are
estimated to be adequate through March 5, 1998, per contractor
memorandum of November 21,1997.
Replacement page 13 is attached and should be appropriately inserted in
copies of the contract.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Michael S. McCarty
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/MICHAEL S. MCCARTY 11-21-97
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 150
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
5
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-5
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 North, Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/400000/34/98/PF Increase $5,642,210
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return |_| copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
Incremental funding is revised from $7,347,118 to $12,989,328 an
increase of $5,642,210 as reflected in the revised Article B-12,
Contract Funding, Table B-12.
The funds are estimated to be adequate through July 04, 1998, per
contractor memorandum of January 15, 1998.
Replacement page 13 is attached and should be appropriately inserted in
copies of the contract.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Sharon L. White
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/SHARON L. WHITE 1-22-98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 151
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
6
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-6
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 North, Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/400000/34/98/PF Increase $5,571,875
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return |_| copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
Incremental funding is revised from $12,989,328 to $18,561,203 an
increase of $5,571,875 as reflected in the revised Article B-12,
Contract Funding, Table B-12.
The funds are estimated to be adequate through September 24, 1998 per
contractor memorandum of April 27, 1998.
Replacement page 13 is attached and should be appropriately inserted in
copies of the contract.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Sharon L. White
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/SHARON L. WHITE 4-28-98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 152
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
7
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 North, Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
X D. OTHER (Specify type of modification and authority)
Bilateral modification entered into by mutual agreement of both parties
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document
and return |4| copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
The purpose of this modification is to give notice that the parties
hereby agree to convert this contract to a performamce based
cost-plus-award-fee/incentive fee contract (completion form task order
contract) for the option periods, commencing with Option 1 on October
1, 1998. The Level-of-Effort components of the contract schedule will
be changed to accomodate this change in contract type. The award fee
evaluation plan will also be modified to reflect the incentive fee
arrangement, and put provisions in the plan which will include the
assesment of contractor performance against performance based contract
metrics in the performance evaluation process.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
See Tripartite Signature Page (next page)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
See Tripartite Signature Page (next page)
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
FAR (48 CFR) 53.243
<PAGE> 153
NAS1O-98001 (BDC) Section A
- --------------------------------------------------------------------------------
Tripartite Signature Page
Contract: NAS10-98001 Mod. No. 7
Subcontract: 0455-97.706158 Page 2 of 2
Dynacs Engineering Company, Inc.
22870 US Hwy 19, North, Suite 405
Clearwater, FL 34621
BY: /S/ RAMEN P. SINGH DATE: 6/22/98
NAME AND TITLE: Ramen P. Singh
President
PRIME CONTRACTOR
U.S. Small Business Administration
1320 South Dixie Hwy
Coral Gables, FL 33146
BY: ______________________ DATE:_____________________
NAME AND TITLE:_______________________
_______________________
PROCURING AND ADMINISTRATIVE OFFICE
John F. Kennedy Space Center. NASA
Procurement Office, OP-OSO
Kennedy Space Center, FL 32899
BY: ______________________ DATE:_____________________
NAME AND TITLE:_______________________
_______________________
2
<PAGE> 154
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
8
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-7
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 North, Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/400000/34/98/PF Increase $2,823,558.00
CW-1/2590C/400000/34/97/PF Increase $ 125,799.00
Total $2,949,352.00
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return |_| copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
Incremental funding is increased by $2,949,352.00 as reflected in the
revised Article B-12, Contract Funding, Table B-12. The funds are
estimated to be adequate through September 30, 1998, per contractor
memorandum of June 24, 1998.
As a result of the above change, delete page 13 of the contract, and
substitute the enclosed page 13 in lieu thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Rene E. Paquette
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ RENE E. PAQUETTE 6-25-98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 155
NAS1O-98001 (EDC) Section B
- --------------------------------------------------------------------------------
ARTICLE B-11 COVERAGE OF PRE-EXISTING MEDICAL CONDITIONS
Health insurance provided to incumbent employees hired under this contract
within 30 days of commencing contract performance will include coverage of
pre-existing medical conditions currently covered under the insurance provided
by the incumbent contractor.
ARTICLE B-12 NFS 1852.232-81 CONTRACT FUNDING (JUN 1990)
-------------------------------------------
For purposes of payment of cost, exclusive of fee, pursuant to the Limitation of
Funds clause, the total amount allotted by the Government is defined in Table
B-12.
Table B-12
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Basic $16,070,575 $ 500,000 $ 480,769 $ 980,769 $ 19,231 $ 1,000,000 October 22, 1997
1 $ 250,000 $ 1,024,650 $ 1,274,650 $ 40,986 $ 1,315,636 November 17, 1997
2 $ 250,000 $ 654,615 $ 904,615 $ 26,185 $ 930,800 December 10, 1997
3 $ 12,452 $ 1,105,371 $ 1,117,823 $ 36,124 $ 1,153,947 January 3, 1998
4 $ 726,823 $ 2,133,009 $ 2,859,832 $ 86,903 $ 2,946,735 March 5, 1998
5 $ 1,610,156 $ 3,872,422 $ 5,482,578 $ 159,632 $ 5,642,210 July 4, 1998
6 $ 1,671,191 $ 3,847,546 $ 5,518,737 $ 53,137 $ 5,571,875 August 18, 1998
- ---- ---------------
7
8 $ 2,660,340 $ 289,012 $ 2,949,352 $ 0 $ 2,949,352 September 30, 1998
- ----------------------------------------------------------------------------------------------------------------
Total $16,070,575 $ 7,680,962 $13,407,394 $21,088,356 $ 422,198 $21,510,555 September 30, 1998
================================================================================================================
</TABLE>
Modification 8
June 25, 1998
<PAGE> 156
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
9
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-7
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 North, Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
N/A
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return |_| copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
THE PURPOSE OF THIS MODIFICATION IS TO CORRECT MODIFICATION #8, BLOCK 12
OF SF 30 and ARTICLE B-12, PAGE 13, LINE ITEM #8 to read a total of
$2,949,357 IN LIEU OF $2,949,352. ARTICLE B-12 PAGE 13, Total Obligation
to date should read $21,510,560 in lieu of $21,510,555.
As a result of the above change, delete page 13 of the contract, and
substitute the enclosed page 13 in lieu thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Rene E. Paquette
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ RENE E. PAQUETTE 6-29-98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 157
NAS1O-98001 (EDC) Section B
- --------------------------------------------------------------------------------
ARTICLE B-11 COVERAGE OF PRE-EXISTING MEDICAL CONDITIONS
-------------------------------------------
Health insurance provided to incumbent employees hired under this contract
within 30 days of commencing contract performance will include coverage of
pre-existing medical conditions currently covered under the insurance provided
by the incumbent contractor.
ARTICLE B-12 NFS 1852.232-81 CONTRACT FUNDING (JUN 1990)
-------------------------------------------
For purposes of payment of cost, exclusive of fee, pursuant to the Limitation of
Funds clause, the total amount allotted by the Government is defined in Table
B-12.
Table B-12
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Basic $16,070,575 $ 500,000 $ 480,769 $ 980,769 $ 19,231 $ 1,000,000 October 22, 1997
1 $ 250,000 $ 1,024,650 $ 1,274,650 $ 40,986 $ 1,315,636 November 17, 1997
2 $ 250,000 $ 654,615 $ 904,615 $ 26,185 $ 930,800 December 10, 1997
3 $ 12,452 $ 1,105,371 $ 1,117,823 $ 36,124 $ 1,153,947 January 3, 1998
4 $ 726,823 $ 2,133,009 $ 2,859,832 $ 86,903 $ 2,946,735 March 5, 1998
5 $ 1,610,156 $ 3,872,422 $ 5,482,578 $ 159,632 $ 5,642,210 July 4, 1998
6 $ 1,671,191 $ 3,847,546 $ 5,518,737 $ 53,137 $ 5,571,875 August 18, 1998
7
8 $ 2,660,340 $ 289,012 $ 2,949,352 $ 0 $ 2,949,352 September 30, 1998
9 $ 0 $ 0 $ 5 $ 0 $ 5 September 30, 1998
- ----------------------------------------------------------------------------------------------------------------
Total $16,070,575 $ 7,680,962 $13,407,394 $21,088,361 $ 422,198 $21,510,560 September 30, 1998
================================================================================================================
</TABLE>
13 Modification 9
June 29, 1998
<PAGE> 158
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 6
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
10
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Highway 19 North, Suite 300 100 So. Biscayne Blvd. 7th fl.
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
X D. OTHER (Specify type of modification and authority)
Contract Article B-5.
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document
and return |4| copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
The purpose of this modification is to:
1. Excercise an option for 134,000 level-of-effort hours.
2. Change the address of the Prime Contractor and Subcontractor
3. Correct Table B-12.
4. Add Table to track options hours exercised.
(See Page 2)
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Rene E. Paquette
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ RENE E. PAQUETTE 7-10-98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
FAR (48 CFR) 53.243
DUPLICATE ORIGINAL
<PAGE> 159
Page 2 of 6
Mod. No. 10
1. Pursuant to Contract Article B-5, OPTIONS TO EXTEND THE PERIOD OF
CONTRACT AND OPTIONS FOR INCREMENTAL INCREASE OF EFFORT, the Government
unilaterally increases the number of man-hours required by 134,000 for
the period October 1, 1997 through September 30, 1998. A table for
tracking exercised option hours has been incorporated in this article.
2. Contract Article B-3, CONTRACT VALUE, for the period 10/1/97 through
9/30/98 is increased by $3,615,320 (134,000 option man-hours @ the
contract option hours labor rate of $26.98 - no fee).
3. Contract Article B-12, NFS 1852.232-81 CONTRACT FUNDING (JUN 1990). The
columns for Cost Other and Total Cost & Fee are corrected to reflect
error in addition on a previous modification.
4. Address changes on both the prime and subcontractor are made on the
SF30.
As a result of the above changes, pages 7, 8, 9 and 13 of said contract, as
modified, are deleted and replacement pages 7, 8,9 and 13 are substituted in
lieu thereof.
<PAGE> 160
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
PART I - THE SCHEDULE
Section B
Supplies or Services and Prices/Cost
------------------------------------
ARTICLE B-1 TYPE OF CONTRACT
----------------
This is a cost-plus-award-fee, term form of contract with a level of effort
basis. The Contractor is obligated to provide Engineering, Engineering Support,
and Facilities and Laboratory Support. Specific requirements will be levied on
the Contractor by Work Orders in accordance with the Statement of Work (SOW),
Attachment J-1.
ARTICLE B-2 EFFORT REQUIRED DURING CONTRACT PERFORMANCE
--------------------------------------------
A. The Contractor shall provide non-personal services for NASA as described
in Article C-1, "Scope of Work" and Attachment J-1, "Statement of Work"
on a level of effort (LOE) basis. In performance of the described work
during the contract period set forth below, the Contractor shall not
exceed the total labor hours on the contract, including subcontractor
and overtime hours.
Table B-2
- ---------------------------------------------------------------
Labor Hours
Contract Period Minimum Target Maximum
- ---------------------------------------------------------------
10/1/97-9/30/98 375,502 387,115 398,728
Mod. No 10 134,000
Total 532,728
Option Periods
10/1/98 - 9/30/99 375,502 387,115 398,728
10/1/99 - 9/30/00 375,502 387,115 398,728
10/1/00 - 9/30/01 375,502 387,115 398,728
10/1/01 - 9/30/02 375,502 387,115 398,728
B. If the Contractor has not provided the specified minimum quantity of
total contract labor hours set forth in the above paragraph A, an
equitable downward adjustment will be made in estimated cost and
available award fee. The downward adjustment will be based on the
difference between the minimum labor hours specified under this Article
and the number of labor hours provided by the Contractor. This provision
does not affect the Government's right to reduce the quantity of labor
hours during the term of this contract pursuant to the Termination
Clause (FAR 52.249-6).
C. When the total labor hours expended reach 95% of the maximum labor hours
specified above, the Contractor shall notify the Contracting Officer as
to whether or not the Contractor believes that amount will be sufficient
for the balance of the period of performance, or if additional labor
hours will be required. In the latter case, the notification shall
include the estimated "adequate through" date for the unexpended balance
and an estimate of the additional hours required for the balance of the
period of performance. If, during the term of the contract, an increase
in the specified maximum number of labor hours becomes necessary, the
Government may elect to increase the
D. As used herein, the term "labor hours" shall include the productive and
non-productive time of the employees assigned to this contract
(including subcontracted and overtime labor hours).
Modification No. 10
Page 3 of 6
<PAGE> 161
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
ARTICLE B-3 CONTRACT VALUE
--------------
A. The contract value is comprised of estimated cost and award fee as shown
in Table B-3. The Contractor may earn award fee at the end of the twelve
month basic period of performance and any twelve month option period, if
exercised.
Table B-3
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------
Estimated Available Earned Award Adjective Contract
Contract Period Cost Award Fee Fee Score Rating Value
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
10/1/97 - 9/30/98 $15,648,377 $ 422,198 $ TBD TBD TBD $16,070,575
Mod No 10 $ 3,615,320 $ 0 $ 3,615,320
----------- ----------- -----------
$19,263,697 $ 422,198 $ TBD TBD TBD $19,685,895
=========== =========== ===========
Option Periods
10/1/98 - 9/30/99 $15,928,312 $ 433,396 $ TBD TBD TBD $16,361,708
----------- ----------- -----------
10/1/99 - 9/30/00 $16,221,875 $ 445,138 $ TBD TBD TBD $16,667,013
----------- ----------- -----------
10/1/00 - 9/30/01 $16,546,972 $ 458,142 $ TBD TBD TBD $17,005,114
----------- ----------- -----------
10/1/01 - 9/30/02 $16,881,876 $ 471,538 $ TBD TBD TBD $17,353,414
----------- ----------- -----------
</TABLE>
The fee allocation rate for optional labor hours exercised pursuant to Article
B-5 shall be the rate applicable to the current contract period as specified
therein.
ARTICLE B-4 OTHER DIRECT COSTS
------------------
Notwithstanding the provisions of Article G-7 entitled "Base Support", the
Contractor may be required to provide Work Order related items identified in, or
required by, Work Orders issued in accordance with Attachment J-1, Appendix 3
"Work Order Procedure." These items, classified as Other Direct Costs, include,
but are not limited to, materials, supplies, equipment, maintenance services,
travel, and training. This action is authorized only if such items/services are
not available pursuant to Article G-7 entitled "Base Support." The estimated
cost of this contract includes the amount of $5,000,000 in the basic contract
period and $5,000,000 in each of the four option periods for the acquisition of
such items or services. The costs covered by this article shall be separately
accumulated and reported in accordance with DRD-003. Such costs are considered
non-fee-bearing.
ARTICLE B-5 OPTIONS TO EXTEND THE PERIOD OF CONTRACT AND
--------------------------------------------
OPTIONS FOR INCREMENTAL INCREASE OF EFFORT
--------------------------------------------
A. Options to Extend the Period of Contract
1. This contract is renewable for the periods identified as options
in Table B-3 at the option of the Government.
2. The Government may extend the term of the contract for the
quantities of supplies or services and period specified in the
Schedule by written modification of this contract before the
current contract performance period expires, provided that the
Government will give the Contractor a preliminary written notice
of intent to extend at least 60 days prior to expiration of any
current period of performance. The preliminary notice does not
commit the Government to exercise the option.
3. If the Government exercises any Option, the extended contract
shall be considered to include this option provision.
Modification No. 10
Page 4 of 6
<PAGE> 162
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
4. The total duration of this contract, including the exercise of
any option(s) under this clause, shall not exceed five (5)
years.
5. It is understood and agreed that any continued performance of
services from period to period shall be at the sole
determination of the Government and will be contingent upon
prior satisfactory performance. Failure to renew the contract
for any subsequent period of performance shall not be
considered as a termination for the convenience of the
Government.
B. Options for Incremental Increase of Effort
The Government may unilaterally increase the number of labor hours
required to be furnished pursuant to Article B-2, during any one year
period of performance, by an amount ranging from 1 to 1,935,575 labor
hours; provided that the cumulative total of option hours exercised does
not exceed 1,935,575 labor hours for the five year contract period. If
the Government elects to exercise its option to increase the number of
labor hours, the Contractor will be notified by a contract modification
executed by the Contracting Officer. If any option is exercised, the
number of minimum, target, and maximum labor hours set forth in Table
B-2 will be increased by the number of hours exercised. The estimated
cost and available award fee in Article B-3 will be increased as follows
for each additional labor hour exercised:
If Exercised During the Period Option Labor Rate Option Fee Rate
------------------------------ ----------------- ---------------
10/01/97-09/30/98 $ 26.98 $ 0.00
------- -------
10/01/98-09/30/99 $ 27.70 $ 0.00
------- -------
l0/01/99-09/30/00 $ 28.45 $ 0.00
------- -------
l0/0l/00-09/30/0l $ 29.28 $ 0.00
------- -------
10/0l/0l-09/30/02 $ 30.14 $ 0.00
------- -------
Failure to exercise any option of the contract shall not be considered
as a termination for the convenience of the Government, If the
Government exercises one or any of the options under this contract, the
contract, as amended, shall include all terms and conditions of the
contract as it exists immediately prior to the exercise of the
additional option(s).
For historical tracking purposes, the following table is established to
document the amount of man-hours exercised to date and the optional
man-hours remaining available:
Option Hours at Award: 1,193,575
(134,000) (exercised via modification #10)
---------
Balance 1,059,575
ARTICLE B-6 OPTIONS FOR OTHER DIRECT COSTS
------------------------------
In addition to the amount for ODC included in Article B-4 as part of the basic
contract, the Government may increase the amount available for payment of Work
Order related items identified in, or required by, Work Orders issued in
accordance with Attachment J-1, Appendix 3 "Work Order Procedure" by not more
than the total shown below. These items, classified as Other Direct Costs,
include, but are not limited to materials, supplies, equipment, maintenance
services, travel and training. If the Government elects to exercise its option
to increase the amount available for ODC, the Contractor will be notified by a
unilateral Contract Modification executed by the Contracting Officer. Options
increasing the amounts available for ODC may be exercised one or more times, at
any time during the performance period of this contract, provided that the
cumulative total estimated cost exercised does not exceed the amount shown
below. The estimated cost in Article B-3 will be adjusted to reflect the amount
of option exercised.
Modification No. 10
Page 5 of 6
<PAGE> 163
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
ARTICLE B-11 COVERAGE OF PRE-EXISTING MEDICAL CONDITIONS
-------------------------------------------
Health insurance provided to incumbent employees hired under this contract
within 30 days of commencing contract performance will include coverage of
pre-existing medical conditions currently covered under the insurance provided
by the incumbent contractor.
ARTICLE B-12 NFS 1852.232-81 CONTRACT FUNDING (JUN 1990)
------------------------------------------
For purposes of payment of cost, exclusive of fee, pursuant to the Limitation
of Funds clause, the total amount allotted by the Government is defined in Table
B-12.
Table B-12
<TABLE>
<CAPTION>
Contract Cost Total Cost Adequate
Mod Value ODC Other Total Fee & Fee ThruDate
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Basic 16,070,575 500,000 480,769 980,769 19,231 1,000,000 22-Oct-97
1 250,000 1,024,650 1,274,650 40,986 1,315,636 17-Nov-97
2 250,000 654,615 904,615 26,185 930,800 10-Dec-97
3 12,452 1,105,371 1,117,823 36,124 1,153,947 3-Jan-98
4 726,823 2,133,009 2,859,832 86,903 2,946,735 5-Mar-98
5 1,610,156 3,872,422 5,482,578 159,632 5,642,210 4-Jul-98
6 1,671,191 3,847,546 5,518,737 53,137 5,571,874 18-Aug-98
8 2,660,340 289,012 2,949,352 0 2,949,352 30-Sep-98
9 0 5 5 0 5 30-Sep-98
10 $ 3,615,320 $0 $0 $0 $0 $0
- ------------------------------------------------------------------------------------------------
Total $19,685,895 $7,680,962 $13,407,399 $21,088,361 $422,198 $21,510,559 30-Sep-98
</TABLE>
Modification 10
Page 6 of 6
<PAGE> 164
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 4
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
11
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor Prime Contractor
Dynacs Engineering Co., Inc. U. S. Small Business Administration
35111 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd., 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
X C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
FAR 52.243-2 CHANGES - COST - REIMBURSEMENT (AUG 1987) ALT II (APR 1984)
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document
and return |3| copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
The purpose of this Supplemental Agreement is to incorporate additional "Year
2000 Compliance" requirements in the contract.
As a result of the above change, page 52 of subject contract, as modified is
hereby deleted, and the attached replacement page 52 and new page 52.1 are
substituted in lieu thereof.
The Contractor agrees that the contract change made herein result in no
increases or decreases to the estimated cost and fee of the contract.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
- -----------------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY
-----------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
FAR (48 CFR) 53.243
<PAGE> 165
NAS10-98001 (EDC) Section A
- --------------------------------------------------------------------------------
Contract: NAS 10-98001
Subcontract: 0455-97-706158
- --------------------------------------------------------------------------------
SUBCONTRACTOR:
Dynacs Engineering Company, Inc.
35111 US Hwy 19, North, Suite 300
Palm Harbor, FL 34684
BY: /S/ RAMEN P. SINGH DATE: 7/24/98
-------------------------------- --------------
NAME AND TITLE: --------------------
--------------------
- --------------------------------------------------------------------------------
PRIME CONTRACTOR:
U.S. Small Business Administration
100 S. Biscayne Blvd., 7th floor
Miami, FL 33131
BY:-------------------------------- DATE:
NAME AND TITLE: -----------------
--------------------
- --------------------------------------------------------------------------------
PROCURING AND ADMINISTRATIVE OFFICE:
John F. Kennedy Space Center, NASA
Procurement Office, OP-OSO
Kennedy Space Center, FL 32899
BY:-------------------------------- DATE:
NAME AND TITLE: --------------
--------------------
<PAGE> 166
NAS10-98001 (EDC) Section A
- --------------------------------------------------------------------------------
Tripartite Signature Page
Contract: NAS10-98001
Subcontract: 0455-97-706158
- --------------------------------------------------------------------------------
SUBCONTRACTOR:
Dynacs Engineering Company, Inc.
35111 US Hwy 19, North, Suite 300
Palm Harbor, FL 34684
BY: /S/ RAMEN P. SINGH DATE: 7/24/98
------------------------------- -------------------
NAME AND TITLE:
--------------------
--------------------
- --------------------------------------------------------------------------------
PRIME CONTRACTOR:
U.S. Small Business Administration
100 S. Biscayne Blvd., 7th floor
Miami, FL 33131
BY: /S/ G. REY MORAN DATE: 8/3/98
-------------------------------- -----------------
NAME AND TITLE: G. REY MORAN
U.S. Small Business Administration
Contracting Officer
----------------------------------
- --------------------------------------------------------------------------------
PROCURING AND ADMINISTRATIVE OFFICE:
John F. Kennedy Space Center, NASA
Procurement Office, OP-OSO
Kennedy Space Center, FL 32899
BY: /S/ RENE E. PAQUETTE DATE: 8/10/98
-------------------------------- -----------------
NAME AND TITLE: RENE E. PAQUETTE
---------------------
CONTRACTING OFFICER
---------------------
- --------------------------------------------------------------------------------
<PAGE> 167
Modification No. 11
NAS10-98001 (EDC) Attachment J-1
- --------------------------------------------------------------------------------
Items or services acquired under this contract are required to include
accurate processing of the date and date-related data (including but not
limited to calculating, comparing, and sequencing) by all hardware and
software products delivered under this contract, individually and in
combination, upon installation. This also includes the manipulation of
data with dates prior to, through, and beyond January 1, 2000, and shall
be transparent to the use.
Hardware and software products provided under this contract shall,
individually, and in combination, successfully transition into the Year
2000 with the correct system date, without human intervention, including
leap year calculations. Such products shall also provide correct results
when moving forward or backward in time across the Year 2000 or
subsequent years.
Year 2000 Compliance
(a) "Year 2000 compliant," as used herein, means that the
information technology (hardware, software and firmware,
including embedded systems or any other electro-mechanical or
processor-based systems used in accordance with its associated
documentation) accurately processes date and date-related data
(including, but not limited to, calculating, comparing and
sequencing) from, into, and between the twentieth and
twenty-first centuries, and the years 1999 and 2000 and leap
year calculations, to the extent that other information
technology, used in combination with the information technology
being acquired, property exchanges date and date-related data
with it.
(b) Any information technology provided, operated and/or maintained
under this contract must be Year 2000 compliant. To ensure this
result, the Contractor shall provide documentation describing
how the IT items or services demonstrate Year 2000 compliance,
consisting of: a certification document signed by the vendor
and/or original equipment manufacturer for commercial items. For
IT items or services developed or built, or commercial items
integrated into a viable package by the contractor, the
contractor shall provide a certification document and integrated
test results demonstrating Year 2000 compliance.
(c) Milestones for Renovation, Validation and Implementation: Any IT
determined to be non-Year 2000 compliant shall be replaced,
retired, or repaired in accordance with the following schedule:
1. "Renovation" includes making and documenting software
and hardware changes, developing replacement systems,
and decommissioning systems to be retired. The
Contractor must complete renovation of affected
software, hardware and firmware by September 30, 1998.
2. "Validation" includes unit, integration, system and
end-to-end testing for Year 2000 compliance. The
Contractor must complete validation and testing of
converted or replaced systems by January 31, 1999.
3. "Implementation" includes acceptance testing and
integration of converted and replaced systems into a
production environment The Contract must complete
implementation by March 31, 1999.
(d) At a minimum, the Contractor shall provide documentation,
including project plans and status reports, which demonstrate
that the Contractor is meeting the milestones listed above.
52
<PAGE> 168
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
NAS10-98001
PAGE OF PAGES
1 7
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
12
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor Prime Contractor
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Highway 19 N., Suite 300 100 S. Biscayne Blvd., 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return |3| copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to reflect a cost variance between the
negotiated estimated cost and the estimated cost to complete the work which
resulted from the skill mix requirements driven by the Government Task Orders
from contract inception to September 30, 1998. This interim adjustment is made
to align contract value with cumulative contract costs and funding.
B. As a result of the above changes, pages 7, 8, 9, 13 and 14 of the contract
are hereby deleted and new pages 7, 8, 9, 9.1, 13 and 14 are substituted in lieu
thereof.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
- -----------------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
Rene E. Paquette
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ RENE E. PAQUETTE 9/28/98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
<PAGE> 169
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
PART I - THE SCHEDULE
Section B
Supplies or Services and Prices/Cost
ARTICLE B-1 TYPE OF CONTRACT
This is a cost-plus-award-fee, term form of contract with a level of effort
basis. The Contractor is obligated to provide Engineering, Engineering Support,
and Facilities and Laboratory Support. Specific requirements will be levied on
the Contractor by Work Orders in accordance with the Statement of Work (SOW),
Attachment J-1.
ARTICLE B.2 EFFORT REQUIRED DURING CONTRACT PERFORMANCE
A. The Contractor shall provide non-personal services for NASA as described
in Article C-1 "Scope of Work" and Attachment J-1, "Statement of Work"
on a level of effort (LOE) basis. In performance of the described work
during the contract period set forth below, the Contractor shall not
exceed the total labor hours on the contract, including subcontractor
and overtime hours.
Table B-2
-------------------------------------------------------------
Labor Hours
Contract Period Minimum Target Maximum
-------------------------------------------------------------
10/1/97 - 9/30/98 375,502 387,115 398,728
Mod. No 10 134,000
Total 532,728
Option Periods
10/1/98 - 9/30/99 375,502 387,115 398,728
10/1/99 - 9/30/00 375,502 387,115 398,728
10/1/00 - 9/30/01 375,502 387,115 398,728
10/1/01 - 9/30/02 375,502 387,115 398,728
B. If the Contractor has not provided the specified minimum quantity of
total contract labor hours set forth in the above paragraph A, an
equitable downward adjustment will be made in estimated cost and
available award fee. The downward adjustment will be based on the
difference between the minimum labor hours specified under this Article
and the number of labor hours provided by the Contractor. This provision
does not affect the Government's right to reduce the quantity of labor
hours during the term of this contract pursuant to the Termination
Clause (FAR 52.249-6).
C. When the total labor hours expended reach 95% of the maximum labor hours
specified above, the Contractor shall notify the Contracting Officer as
to whether or not the Contractor believes that amount will be sufficient
for the balance of the period of performance, or if additional labor
hours will be required. In the latter case, the notification shall
include the estimated "adequate through" date for the unexpended balance
and an estimate of the additional hours required for the balance of the
period of performance. If, during the term of the contract, an increase
in the specified maximum number of labor hours becomes necessary, the
Government may elect to increase the maximum labor hours pursuant to
Article B-5, "Options to Extend the Period of Contract and Options for
Incremental Increase of Effort".
Modification No. 12
Page 2 of 7
<PAGE> 170
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
D. As used herein, the term "labor hours" shall include the productive and
non-productive time of the employees assigned to this contract
(including subcontracted and overtime labor hours).
ARTICLE B-3 CONTRACT VALUE
--------------
A. The contract value is comprised of estimated cost and award fee as shown
in Table B-3. The Contractor may earn award fee at the end of the twelve
month basic period of performance and any twelve month option period, if
exercised.
Table B-3
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------
Estimated Available Earned Award Adjective Contract
Contract Period Cost Award Fee Fee Score Rating Value
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
10/1/97-9/30/98 $15,648,377 $422,198 $ TBD TBD TBD $16,070,575
Mod No 10 $3,615,320 $0 $3,615,320
Mod No 12 $2,049,191 ($22,198) $ TBD TBD TBD $2,026,993
---------- -------- -----------
Total $21,312,888 $400,000 $21,712,888
Option Periods
10/1/98 - 9/30/99 $15,928,312 $433,396 $ TBD TBD TBD $16,361,708
10/1/99 - 9/30/00 $16,221,875 $445,138 $ TBD TBD TBD $16,667,013
10/1/00 - 9/30/01 $16,546,972 $458,142 $ TBD TBD TBD $17,005,114
10/1/01 - 9/30/02 $16,881,876 $471,538 $ TBD TBD TBD $17,353,414
</TABLE>
The fee allocation rate for optional labor hours exercised pursuant to
Article B-S shall be the rate applicable to the current contract period
as specified therein.
ARTICLE B-4 OTHER DIRECT COSTS
------------------
Notwithstanding the provisions of Article G-7 entitled "Base Support", the
Contractor may be required to provide Work Order related items identified in, or
required by, Work Orders issued in accordance with Attachment J-1, Appendix 3
"Work Order Procedure." These items, classified as Other Direct Costs, include,
but are not limited to, materials, supplies, equipment, maintenance, services,
travel, and training. This action is authorized only if such items/services are
not available pursuant to Article G-7 entitled "Base Support." The estimated
cost of this contract includes the amount of $5,000,000 in the basic contract
period and $5,000,000 in each of the four option periods for the acquisition of
such items or services. The costs covered by this article shall be separately
accumulated and reported in accordance with DRD-003. Such costs are considered
non-fee-bearing.
Modification No. 12
Page 3 of 7
<PAGE> 171
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
ARTICLE B-5 OPTIONS TO EXTEND THE PERIOD OF CONTRACT AND
--------------------------------------------
OPTIONS FOR INCREMENTAL INCREASE OF EFFORT
------------------------------------------
A. Options to Extend the Period of Contract
1. This contract is renewable for the periods identified as options
in Table B-3 at the option of the Government.
2. The Government may extend the term of the contract for the
quantities of supplies or services and period specified in the
Schedule by written modification of this contract before the
current contract performance period expires, provided that the
Government will give the Contractor a preliminary written notice
of intent to extend at least 60 days prior to expiration of any
current period of performance. The preliminary notice does not
commit the Government to exercise the option.
3. If the Government exercises any option, the extended contract
shall be considered to include this option provision.
4. The total duration of this contract, including the exercise of
any option(s) under this clause, shall not exceed five (5)
years.
5. It is understood and agreed that any continued performance of
services from period to period shall be at the sole
determination of the Government and will be contingent upon
prior satisfactory performance. Failure to renew the contract
for any subsequent period of performance shall not be considered
as a termination for the convenience of the Government.
B. Options for Incremental Increase of Effort
The Government may unilaterally increase the number of labor hours
required to be furnished pursuant to Article B-2, during any one year
period of performance, by an amount ranging from 1 to 1,935,575 labor
hours; provided that the cumulative total of option hours exercised does
not exceed 1,935,575 labor hours for the five year contact period. If
the Government elects to exercise its option to increase the number of
labor hours, the Contractor will be notified by a contact modification
executed by the Contracting Officer. If any option is exercised, the
number of minimum, target, and maximum labor hours set forth in Table
B-2 will be increased by the number of hours exercised. The estimated
cost and available award fee in Article B-3 will be increased as follows
for each additional labor hour exercised:
If Exercised During the Period Option Labor Rate Option Fee Rate
------------------------------ ----------------- ---------------
10/01/97 - 09/30/98
Prime Contractor $29.22 (loaded) $0.00
Subcontractors $48.84 (loaded) $0.00
-------------- -----
10/01/98 - 09/30/99 $27.70 $0.00
------ -----
10/0l/99 - 09/30/00 $28.45 $0.00
------ -----
10/01/O0 - 09/30/0l $29.28 $0.00
------ -----
Modification No. 12
Page 4 of 7
<PAGE> 172
NASIO-98001 (EDC) Section B
- --------------------------------------------------------------------------------
Failure to exercise any Option of the contract shall not be considered
as a termination for the convenience of the Government. If the
Government exercises one or any of the options under this contract, the
contract, as amended, shall include all terms and conditions of the
contract as it exists immediately prior to the exercise of the
additional option(s).
For historical tracking purposes, the following table is established to document
the amount of man-hours exercised to date and the optional man-hours remaining
available:
Option Hours at Award: 1,935,575
Exercised via Modification No. 10 (134,000)
--------
Balance 1,801,575
ARTICLE B-6 OPTIONS FOR OTHER DIRECT COSTS
------------------------------
In addition to the amount for ODC included in Article BA as part of the basic
contract, the Government may increase the amount available for payment of Work
Order related items identified in, or required by, Work Orders issued in
accordance with Attachment J-1, Appendix 3 "Work Order Procedure" by not more
than the total shown below. These items, classified as Other Direct Costs,
include, but are not limited to materials, supplies, equipment, maintenance
services, travel and training. If the Government elects to exercise its option
to increase the amount available for ODC, the Contractor will be notified by a
unilateral Contract Modification executed by the Contracting Officer. Options
increasing the amounts available for ODC may be exercised one or more times, at
any time during the performance period of this contract, provided that the
cumulative total estimated cost exercised does not exceed the amount shown
below. The estimated cost in Article B-3 will be adjusted to reflect the amount
of option exercised.
Modification No. 12
Page 5 of 7
<PAGE> 173
NASIO-98001 (EDC) Section B
- --------------------------------------------------------------------------------
ARTICLE B-11 COVERAGE OF PRE-EXISTING MEDICAL CONDITIONS
-------------------------------------------
Health insurance provided to incumbent employees hired under this contract
within 30 days of commencing contract performance will include coverage of
pre-existing medical conditions currently covered under the insurance provided
by the incumbent contractor.
ARTICLE B-12 NFS 1852.232-81 CONTRACT FUNDING (JUN 1990)
------------------------------------------
For purposes of payment of cost, exclusive of fee, pursuant to the Limitation of
Funds clause, the total amount allotted by the Government is defined in Table
B-12, Contract Value and Funding.
Modification No. 12
Page 6 of 7
<PAGE> 174
Table B-12 CONTRACT VALUE & FUNDING
<TABLE>
<CAPTION>
CONTRACT FUNDING
---------------------------------------------------------------------------------------
CONTRACT CONTRACT ALL OTHER TOTAL COST ADEQUATE
MOD VALUE ODC COSTS TOTAL COSTS FEE AND FEE THRU DATE
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Basic $16,070,575 $500,000 $480,769 $980,769 $19,231 $1,000,000 10/22/97
1 250,000 1,024,650 1,274,650 40,986 1,315,636 11/17/97
2 250,000 654,615 904,615 26,185 930,800 12/10/97
3 12,452 1,105,371 1,117,823 36,124 1,153,947 01/03/98
4 726,823 2,133,009 2,859,832 86,903 2,946,735 03/05/98
5 1,610,156 3,872,422 5,482,578 159,632 5,642,210 07/04/98
6 1,671,191 3,847,546 5,518,737 53,137 5,571,874 08/18/98
8 2,660,340 289,012 2,949,352 2,949,352 09/30/98
9 5 5 5 09/30/98
10 3,615,320
12 2,026,993 22,198 22,198 -22,198
Totals:$21,712,888 $7,680,962 $13,429,597 $21,110,559 $400,000 $21,510,559 09/30/98
</TABLE>
Modification No. 12
Page 7 of 7
<PAGE> 175
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
NAS 10-98001
PAGE OF PAGES
1 3
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
13
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Admin.
3511 US Highway 19 N., Suite 300 100 S. Biscayne Blvd, 7th Floor
Palm Harbour, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
N/A
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
X C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
Article H-15, Performance Based Work Orders
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document
and return copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to convert the present Level Of Effort
contract to a Performance Based Contract (PBC) pursuant to Contract Article H-15
"Performance Based Work Orders" and the terms of contract modification number 7
of this contract.
- --------------------------------------------------------------------------------
See Tripartite Signature Page See Tripartite Signature Page
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
FAR (48 CFR) 53.243
<PAGE> 176
B. The following page changes are made by this modification to reflect the
agreements reached on September 24, 1998 to implement application of the
PBC arrangement
Remove Pages Replace With/Add Pages
------------ ----------------------
5 5
7 7
- 7.1
8 8
- 8.1
- 8.2
- 8.3
- 8.4
- 8.5
9 9
- 9.1
10 10
11 11
13 13
14 14
43 43
<PAGE> 177
[ILLEGIBLE]
Mod #13
Page 3 of 3
Tripartite Signature Page
- --------------------------------------------------------------------------------
SUBCONTRACTOR:
- --------------
Dynacs Engineering Company, Inc.
35111 US Hwy 19, North, Suite 300
Palm Harbor, FL 34684
BY: /s/ R. P. Singh DATE: 9/24/98
------------------------------
NAME AND TITLE:
R. P. Singh,
President
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
PRIME CONTRACTOR:
- -----------------
U.S. Small Business Administration
100 S. Biscayne Blvd., 7th floor
Miami, FL 33131
BY: /s/ G. Rey Moran DATE: 9/28/98
NAME AND TITLE: G. Ray Moran,
Contracting Officer
- --------------------------------------------------------------------------------
PROCURING AND ADMINISTRATIVE OFFICE:
- ------------------------------------
John F. Kennedy Space Center, NASA
Procurement Office, OP-OSO
Kennedy Space Center, FL 32899
BY: /s/ Marlo F. Krisberg DATE: 9/29/98
NAME AND TITLE: Marlo F. Krisberg
Contracting Officer
2
<PAGE> 178
- --------------------------------------------------------------------------------
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
- --------------------------------------------------------------------------------
1. CONTRACT ID CODE
NAS10-98001
- --------------------------------------------------------------------------------
PAGE OF PAGES
1 3
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
13
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Page 3
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U.S. Small Business Admin.
35111 US Highway 19 N., Suite 300 100 S. Biscayne Blvd., 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
- --------------------------------------------------------------------------------
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
X C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
Article H-15, Performance Based Work Orders
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document
and return |3| copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to convert the present Level Of Effort
contract to a Performance Based Contract (PBC) pursuant to Contract Article H-15
"Performance Based Work Orders" and the terms of contract modification number 7
of this contract.
- --------------------------------------------------------------------------------
See Tripartite Signature Page
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
----------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
See Tripartite Signature Page
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30- 105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
FAR (48 CFR) 53.243
<PAGE> 179
NAS10-98001
MOD # 13
Page 2 of 3
B. The following page changes are made by this modification to reflect the
agreements reached on September 24, 1998 to implement application of the PBC
arrangement:
Remove Pages Replace With/Add Pages
------------ ----------------------
5 5
7 7
- 7.1
8 8
- 8.1
- 8.2
- 8.3
- 8.4
- 8.5
9 9
- 9.1
10 10
11 11
13 13
14 14
43 43
<PAGE> 180
NAS10-98001
MOD # 13
Page 3 of 3
Tripartite Signature Page
- --------------------------------------------------------------------------------
SUBCONTRACTOR:
- --------------
Dynacs Engineering Company, Inc.
35111 US Hwy 19, North, Suite 300
Palm Harbor, FL 34684
BY: /s/ R. P. Singh DATE: 9/24/98
President
NAME AND TITLE:
R. P. Singh, President
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
PRIME CONTRACTOR:
- -----------------
U.S. Small Business Administration
100 S. Biscayne Blvd., 7th floor
Miami, FL 33131
BY: DATE:
------------------------- --------------
NAME AND TITLE:
-----------------------------------
-----------------------------------
- --------------------------------------------------------------------------------
PROCURING AND ADMINISTRATIVE OFFICE:
- ------------------------------------
John F. Kennedy Space Center, NASA
Procurement Office, OP-OSO
Kennedy Space Center, FL 32899
BY: DATE:
---------------------------------- --------------
NAME AND TITLE:
------------------------
------------------------
2
<PAGE> 181
- --------------------------------------------------------------------------------
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
- --------------------------------------------------------------------------------
1. CONTRACT ID CODE
NAS10-98001
- --------------------------------------------------------------------------------
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
14
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971004/S-8
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Co., Inc. U. S. Small Business Administration
3511 US Highway 19 N., Suite 300 100 S. Biscayne Blvd., 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
- --------------------------------------------------------------------------------
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590/400000/34/98/PF Increase $1,738,706
DUPLICATE ORIGINAL
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
CONTRACTOR'S COPY
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return |3| copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
The purpose of this modification is to incrementally fund the contract for an
additional $1,738,706 as reflected in Table B-12 for a new total of $25,005,521.
Funding is adequate for contract performance through October 31, 1998.
B. As a result of the above change, page 14 of subject contract, as revised, is
hereby deleted and the enclosed page 14 is substituted in lieu thereof.
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
----------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
Rene E. Paquette
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /s/ Rene E. Paquette 9/30/98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30- 105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
FAR (48 CFR) 53.243
<PAGE> 182
NAS 10-98001
MOD. # 14
Page 14
Table B-12 CONTRACT VALUE & FUNDING
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
CONTRACT FUNDING
--------------------------------------------------------------------------------
CONTRACT CONTRACT ALL OTHER TOTAL COST ADEQUATE
MOD VALUE ODC COSTS TOTAL COSTS FEE AND FEE THRU DATE
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Basic $16,070,575 $ 500,000 $ 480,769 $ 980,769 $ 19,231 $ 1,000,000 10/22/97
1 250,000 1,024,650 1,274,650 40,986 1,315,636 11/17/97
2 250,000 654,615 904,615 26,185 930,800 12/10/97
3 12,452 1,105,371 1,117,823 36,124 1,153,947 01/03/98
4 726,823 2,133,009 2,859,832 86,903 2,946,735 03/05/98
5 1,610,156 3,872,422 5,482,578 159,632 5,642,210 07/04/98
6 1,671,191 3,847,546 5,518,737 53,137 5,571,874 08/18/98
8 2,660,340 289,012 2,949,352 2,949,352 09/30/98
9 5 5 5 09/30/98
10 3,615,320
12 2,026,993 22,198 22,198 -22,198
13
14 -2,446,751 4,099,097 1,652,346 86,360 1,738,706 10/31/98
Totals: $21,712,888 $ 5,234,211 $ 17,528,694 $ 22,762,905 $ 486,360 $ 23,249,265 10/31/98
</TABLE>
<PAGE> 183
- --------------------------------------------------------------------------------
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
- --------------------------------------------------------------------------------
1. CONTRACT ID CODE
NAS 10-98001
- --------------------------------------------------------------------------------
PAGE OF PAGES
1 3
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
15
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Co., Inc. U. S. Small Business Administration
35111 US Hwy 19 N, Suite 300 100 S. Biscayne Blvd., 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
- --------------------------------------------------------------------------------
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CONTRACTOR'S COPY
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A. DUPLICATE ORIGINAL
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
- --------------------------------------------------------------------------------
X D. OTHER (Specify type of modification and authority)
Contract Provision B-5, Options to Extend the Period of Contract
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return |3| copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
The purpose of this modification is to exercise the option period commencing
October 1, 1998 through September 30, 1999.
As a result of the above change, pages 8.1 and 14 of subject contract, as
revised, are hereby deleted and the enclosed pages 8,1 and 14 are substituted in
lieu thereof.
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
A. Earl Gilbert
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
----------------------------------
BY /s/ A. Earl Gilbert 9/30/98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30- 105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
FAR (48 CFR) 53.243
<PAGE> 184
NAS10-98001
Mod #15
Page 8.1
Table B-3 CONTRACT VALUE
<TABLE>
<CAPTION>
AVAILABLE EARNED TARGET EARNED AWARD
CONTRACT ESTIMATED AWARD AWARD INCENTIVE INCENTIVE CONTRACT FEE ADJECTIVE
PERIOD COST FEE FEE FEE FEE VALUE* SCORES RATING
- -------------------- ----------- ----------- ------ --------- --------- ----------- ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CY1: 10/01/97 -9/30/98
Initial award $15,648,377 $ 422,198 TBD N/A N/A $16,070,575 TBD TBD
Mod #10 3,615,320 0 N/A N/A 3,615,320
Adj. Values: 19,263,697 422,198 N/A N/A 19,685,895
Mod #12 2,049,191 -22,198 2,026,993
Total CYI: 21,312,888 400,000 21,712,888
CY2: 10/01/98 -09/30/99
Mod #14 16,648,462 444,500 TBD 185,500 TBD 17,278,462 TBD TBD
Contract totals: 37,961,350 844,500 185,500 N/A 38,991,350
Option Periods
10/01/99 -09/30/00 17,052,362 458,000 TBD 189,000 TBD 17,699,862 TBD TBD
10/01/00 -09/30/01 17,468,442 476,000 TBD 189,000 TBD 18,133,442 TBD TBD
10/01/01 -09/30/02 17,902,442 490,000 TBD 192,500 TBD 18,584,942 TBD TBD
Option totals: 52,423,246 1,424,500 570,500 54,418,246
Total values: 90,384,596 2,269,000 570,500 93,409,596
</TABLE>
*Includes available award fee and target incentive fee until such time as earned
fees are entered into the table at which time the contract value includes the
earned fee amounts.
<PAGE> 185
NAS10-98001
Mod #15
Page 14
TABLE B-12 CONTRACT VALUE & FUNDING
<TABLE>
<CAPTION>
CONTRACT FUNDING
---------------------------------------------------------------------------------
CONTRACT CONTRACT ALL OTHER TOTAL COST ADEQUATE
MOD VALUE ODC COSTS TOTAL COSTS FEE AND FEE THRU DATE
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Basic $16,070,575 $ 500,000 $ 480,769 $ 980,769 $ 19,231 $ 1,000,000 10/22/97
1 250,000 1,024,650 1,274,650 40,986 1,315,636 11/17/97
2 250,000 654,615 904,615 26,185 930,800 12/10/97
3 12,452 1,105,371 1,117,823 36,124 1,153,947 01/03/98
4 726,823 2,133,009 2,859,832 86,903 2,946,735 03/05/98
5 1,610,156 3,872,422 5,482,578 159,632 5,642,210 07/04/98
6 1,671,191 3,847,546 5,518,737 53,137 5,571,874 08/18/98
8 2,660,340 289,012 2,949,352 2,949,352 09/30/98
9 5 5 5 09/30/98
10 3,615,320
12 2,026,993 22,198 22,198 -22,198
14 -2,446,751 4,099,097 1,652,346 86,360 1,738,706 10/31/98
15 17,278,482
Totals: $38,991,350 $ 5,234,211 $17,528,694 $22,762,905 $486,360 $23,249,265 10/31/98
</TABLE>
<PAGE> 186
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
16
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U.S. Small Business Administration
3511 US Hwy 19 North, Suite 310 100 So. Biscayne Blvd. 7th fl.,
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
- --------------------------------------------------------------------------------
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 $2,169,045
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
CONTRACTOR'S COPY DUPLICATE ORIGINAL
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
The purpose of this modification is to increase the funding of the
contract by $2,169,145. This modification also corrects Article B-12,
Mod. No. 6 to read $5,571,875 in lieu of $5,571,874. The total funding
to date is $25,418,311.
These additional funds extend the period of performance through December
9,1998.
As a result of the above change, page 14 of subject contract, as
revised, is deleted and the enclosed page 14 is substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Rene E. Paquette
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ RENE E. PAQUETTE 10-8-98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (Rev.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 187
NAS10-98001
Mod. No. 16
Page 14
Table B-12 CONTRACT VALUE & FUNDING
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------
CONTRACT FUNDING
-----------------------------------------------------------------------------
CONTRACT CONTRACT ALL OTHER TOTAL COST ADEQUATE
MOD VALUE ODC COSTS TOTAL COSTS FEE AND FEE THRU DATE
-----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Basic $16,070,575 $ 500,000 $ 480,769 $ 980,769 $ 19,231 $ 1,000,000 10/22/97
1 250,000 1,024,650 1,274,650 40,986 1,315,636 11/17/97
2 250,000 654,615 904,615 26,185 930,800 12/10/97
3 12,452 1,105,371 1,117,823 36,124 1,153,947 01/03/98
4 726,823 2,133,009 2,859,832 86,903 2,946,735 03/05/98
5 1,610,156 3,872,422 5,482,578 159,632 5,642,210 07/04/98
6 1,671,192 3,847,546 5,518,738 53,137 5,571,875 08/18/98
8 2,660,340 289,012 2,949,352 2,949,352 09/30/98
9 5 5 5 5 09/30/98
10 3,615,320
12 2,026,993 22,198 22,198 -22,198
14 -2,446,751 4,099,097 1,652,346 86,360 1,738,706 10/31/98
15 17,278,462
16 66,564 1,992,643 2,059,207 109,838 2,169,045 12/9/98
Totals: $38,991,350 $ 5,300,776 $19,521,337 $24,822,113 $ 596,198 $25,418,311 12/9/98
</TABLE>
*Added $1 to Mod 6 ODC
<PAGE> 188
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
NAS10-98001
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
17
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C,
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 950524
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor Prime Contractor
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd., 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS, IT MODIFIES THE
CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES SET
FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE
CHANGES (such as changes in paying office, appropriation date, etc.) SET FORTH
IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
- --------------------------------------------------------------------------------
|X| D. OTHER (Specify type of modification and authority)
Unilateral Modification in accordance with
Atachment J-4 EDC Award Fee Evaluation Plan
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document and
return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
including solicitation/contract subject matter where feasible.)
A. This contract modification reflects the performance rating and earned
award fee for the period October 1, 1997, through September 30, 1998, as
follows:
Rating: Very Good Earned Award Fee: $360,000.00
NOTE: PROVISIONAL AWARD FEE PAYMENTS DISBURSED TO DATE IN THE AMOUNT OF
$337,758.00 ARE HEREBY DEDUCTED FROM THE EARNED AWARD FEE FOR A NET
AMOUNT DUE OF $22,242.00.
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ BOB R. PIRKLE 11-13-98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 189
NAS10-98001
Mod. No. 17
Page 2 of 2
B. The fee determination reflected above is hereby implemented via the
following changes to the contract.
1. Contract Table B-3 is deleted and replaced by Tables B-3.A and B-3.C.
2. The contract value for CY1 is decreased by $40,000.00, from
$21,712,888.00 to $21,672,888.00, to reflect the amount of unearned
award fee.
C: The following page changes are made by this modification:
Remove Pages Replace Pages
------------ -------------
8 8
8.1 8.1
8.2 8.2
- 8.2.1
14 14
<PAGE> 190
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
18
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-1 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 North., Suite 300 100 So. Biscayne Blvd., 7th fl.
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 $3,512,128.00 Increase
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the
contract with an additional $3,512,128.00 as reflected in Table B-12 for
a revised total of $28,930,439. Funding is adequate for contract
performance through January 30,1999.
B. As a result of the above change, page 14 of subject contract, as
revised, is deleted and the enclosed page 14 is substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ BOB R. PIRKLE 11-24-98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.24
<PAGE> 191
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
19
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-2 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 North, Suite 300 100 So. Biscayne Blvd., 7th fl.
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 $11,056,165.00 INCREASE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the
contract with an additional $11,056,165.00 as reflected in Table B-12
for a revised total of $39,986,604.00. funding is adequate for contract
performance through July 15,1999.
B. As a result of the above change, page 14 of subject contract, as
revised, is deleted and the enclosed page 14 is substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ BOB R. PIRKLE 1-20-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.24
<PAGE> 192
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
20
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-3 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 North, Suite 300 100 So. Biscayne Blvd., 7th fl.
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 $2,801,843.00 INCREASE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the
contract with an additional $2,801,843.00 as reflected in Table B-12
for a revised total of $42,788,447.00. Funding is adequate for contract
performance through August 30,1999.
B. As a result of the above change, page 14 of subject contract, as
revised, is deleted and the enclosed page 14 is substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ BOB R. PIRKLE 3-15-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.24
<PAGE> 193
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
21
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd., 7th floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
NO CHANGE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
|X| D. OTHER (Specify type of modification and authority)
Exercise of Option pursuant to Contract Article B-5
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
This modification serves to exercise an option for 187,000 additional
labor hours.
SEE PAGE 2
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ BOB R. PIRKLE 4-28-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.24
<PAGE> 194
NAS10-98001
Mod. No.21
Page 2 of 2
1. Pursuant to Contract Article B-5, OPTIONS TO EXTEND THE PERIOD OF
CONTRACT AND OPTIONS FOR INCREMENTAL INCREASE OF EFFORT, the Government
unilaterally increases the maximum number of labor hours that can be
ordered during the period October 1, 1998 through September 30, 1999 by
187,000 (163,550 Direct/23,450 Subcontract). This action increases the
total contract value from $38,951,350 to $45,481,964, an increase of
$6,530,614.
2. Contract Article B-2, EFFORT REQUIRED DURING CONTRACT PERFORMANCE, is
updated to reflect an increase in the maximum order requirements from
350,000 hours to 537,000 hours for the period October 1, 1998 through
September 30, 1999.
3. Contract Article B-5, OPTIONS TO EXTEND THE PERIOD OF CONTRACT AND
OPTIONS FOR INCREMENTAL INCREASE OF EFFORT, is updated to reflect the
total number of hours exercised to date and the optional labor hours
remaining available.
4. Contract Tables B-3.A, CONTRACT VALUE, and B-12, CONTRACT VALUE AND
FUNDING, are updated to reflect the increase to estimated cost of
$6,194,014, and increase the amounts for available award fee and
incentive fee by $237,490, and $99,110, respectively.
5. Contract Table B-3.C, AVAILABLE AND EARNED FEES, is updated to
reflect an increase to available award fee of $237,490, and $99,110,
for incentive fee.
6. The following page changes are made by this modification:
Remove Pages Add/Replace Pages
------------ -----------------
7.1 7.1
8.1 8.1
8.2.1 8.2.1
9 9
14 14
<PAGE> 195
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
- --------------------------------------------------------------------------------
1. CONTRACT ID CODE
- --------------------------------------------------------------------------------
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
22
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-4 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA --------------------------
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA --------------------------
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 North, Suite 300 100 So. Biscayne Blvd., 7th fl.
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
- --------------------------------------------------------------------------------
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 $2,351,977.00 INCREASE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the
contract with an additional $2,351,977.00 as reflected in Table B-12
for a revised total of $45,140,424.00. Funding is adequate for contract
performance through September 30, 1999.
B. As a result of the above change, page 14 of subject contract, as
revised, is deleted and the enclosed page 14 is substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /s/ Bob R. Pirkle 5-20-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 196
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
- --------------------------------------------------------------------------------
1. CONTRACT ID CODE
NAS1O-98001
- --------------------------------------------------------------------------------
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
23
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-5 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA --------------------------
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO BP
John F. Kennedy Space Center, NASA --------------------------
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Admin.
35111 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd., 7th floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
- --------------------------------------------------------------------------------
CODE FACILITY CODE
- --------------------------------------------------------------------------------
9A. AMENDMENT OF SOLICITATION NO.
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 MR 991033 S-5 (F) $1,017,500.00 increase
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|_| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
|X| D. OTHER (Specify type of modification and authority)
Exercise of option pursuant to Article B-5
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
The purpose of this modification is to incrementally fund the
contract with an additional $1,017,500.00 and to exercise the option for
19,000 additional labor hours.
SEE PAGE 2
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /s/ Bob R. Pirkle 7-27-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 197
NAS10-98001
Mod. No. 23
Page 2 of 2
A. This modification incrementally funds the contract with an additional
$1,017,500 as reflected in the Table B-12 for a revised total of $46,157,924.
Funding is adequate for contract performance through September 1999.
B. Pursuant to Contract Article B-5, OPTIONS TO EXTEND THE PERIOD OF CONTRACT
AND OPTIONS FOR INCREMENTAL INCREASE OF EFFORT, the Government unilaterally
increases the maximum number of labor hours that can be ordered during the
period October 1, 1998 through September 30, 1999 by 19,000 (13,000 Direct /
3,000 Subcontract). This action increases the total contract value from
$45,481,964 to $46,157,924, an increase of $675,960.
C. Contract Article B-2, EFFORT REQUIRED DURING CONTRACT PERFORMANCE, is updated
to reflect an increase in the maximum order requirements from 537,000 hours to
556,000 hours for the period October 1, 1998 through September 30, 1999.
D. Contract Article B-5, OPTIONS TO EXTEND THE PERIOD OF CONTRACT AND OPTIONS
FOR INCREMENTAL INCREASE OF EFFORT, is updated to reflect the total number of
hours exercised to date and optional labor hours remaining available.
E. Contract Tables B-3.A, CONTRACT VALUE, and B-12, CONTRACT VALUE AND FUNDING,
are updated to reflect the increase to estimated cost of $641,760, and increase
the amounts of available award fee and incentive fee by $24,130 and $10,070,
respectively.
F. Contract Table B-3.C, AVAILABLE AND EARNED FEES, is updated to reflect an
increase to available award fee of $24,130 and $10,070, for incentive fee.
G. The following page changes are made by this modification:
Remove Pages Replace Pages
------------ -------------
7.1 7.1
8.1 8.1
8.2.1 8.2.1
9 9
14 14
<PAGE> 198
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
- --------------------------------------------------------------------------------
1. CONTRACT ID CODE
NAS10-98001
- --------------------------------------------------------------------------------
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
24
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO TP
John F. Kennedy Space Center, NASA --------------------------
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO TP
John F. Kennedy Space Center, NASA --------------------------
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Co., Inc. U. S. Small Business Admin.
35111 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd., 7th floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
- --------------------------------------------------------------------------------
CODE FACILITY CODE
- --------------------------------------------------------------------------------
9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to add a clause entitled "ARTICLE
G-8, GOVERNMENT FURNISHED PROPERTY" to the contract. Replacement page 27
that contains the new clause is attached to this modification.
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /s/ Timothy W. Pugh 7-30-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 199
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
- --------------------------------------------------------------------------------
1. CONTRACT ID CODE
NAS10-98001
- --------------------------------------------------------------------------------
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
25
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Admin.
35111 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd., 7th floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
- --------------------------------------------------------------------------------
CODE FACILITY CODE
- --------------------------------------------------------------------------------
9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
|X| C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
FAR 52-243-2 CHANGES COST REIMBURSEMENT (AUG 1989) ALTERNATE I (APR
1984) AND MUTUAL AGREEMENT OF THE PARTIES
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor | | is not, |X| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to add a clause entitled "ARTICLE
G-9, KSC 52.239-90 KSC INFORMATION TECHNOLOGY (IT) SECURITY PROGRAM (AUG
1999)" to contract NAS10-98001. Replacement page 27 that contains the
new clause is attached to this modification.
B. The above modification results in no adjustment in contract valued.
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
/s/ [ILLEGIBLE] 8-20-99
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ TimothY W. Pugh 9-13-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
Contractor's Copy FAR (48 CFR) 53.243
<PAGE> 200
NAS10-98001
Modification 25
Page 27
Government to fulfill them in a timely manner in order To minimize
Contractor procurement.
D. Items generally considered "fixtures" (i.e., become a part of the premises
when installed, such as water coolers, air condititioners partitions...)
shall not be purchased by the Contractor under the authority of this clause.
Additionally, items of a capital nature shall not be purchased under the
authority of this clause without the prior written approval of the
Contracting Officer.
ARTICLE G-8 GOVERNMENT FURNISHED PROPERTY (Incorporated via Modification 24)
The Government property to be furnished under this contract is set forth in
Section J, Attachment J-2 of this contract.
A. Rent-Free Use
1. The Contractor may enter into arrangements with other on-site
contractors to perform certain work in furtherance of KSC objectives. To this
end, the contractor is authorized to use, on a rent-free non-interference basis,
the Government-furnished property and facilities provided under this contract.
This authority may be unilaterally withdrawn by the Government without
adjustment to any other provision of this contract.
ARTICLE G-9 KSC 52.239-90 KSC INFORMATION TECHNOLOGY (IT) SECURITY PROGRAM (AUG
1999) (Incorporated via Modification 25)
KSC Contractors that process NASA data shall comply with NASA's Information
Technology (IT) Security Program. Contractors shall ensure as computers are
reassigned or excessed that computer's hard disks are erased so that sensitive
data and Government-licensed software cannot be recovered.
The Contractor shall comply with the following:
a. NPD 2810.1, Security of Information Technology, available for review at
http://nodis.hq.nasa.gov/Library/Directives/NASA-WIDE/Policies/Legal
Policies/N_PD_2810_1.html
b. NPG 2810, Security of Information Technology, available for review at
http://www.ksc.nasa.gov/nasaonly/cio/nasadocs/npg2810_21may99.pdf
c. KDP-KSC-P-1836, Removing Data and licensed Software from Information
Technology Storage Devices, available for review under Kennedy
Documented Procedures, (AA) at
http://wit.ksc.nasa.gov/BusinessWorld/html/ksc_procedures.html
<PAGE> 201
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
- --------------------------------------------------------------------------------
1. CONTRACT ID CODE NAS10-98001
- --------------------------------------------------------------------------------
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
26
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-6 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Admin.
35111 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd. 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
- --------------------------------------------------------------------------------
CODE FACILITY CODE
- --------------------------------------------------------------------------------
9A. AMENDMENT OF SOLICITATION NO.
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 MR 991003 S-6 $2,200,031.00 Increase
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
FAR 52-243-2 CHANGES COST REIMBURSEMENT (AUG 1989) ALTERNATE I (APR
1984) AND MUTUAL AGREEMENT OF THE PARTIES
- --------------------------------------------------------------------------------
|X| D. OTHER (Specify type of modification and authority)
Contract Provision B-5, Options to Extend the Period of Contract.
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
See Page 2
Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full effect.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Marlo F. Krisberg
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /s/ Marlo F. Krisberg 9-8-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 202
NAS10-98001
Modification 26
Page 2 of 2
A. The purpose of this modification is to exercise the option period commencing
October 1, 1999 through September 30, 2000. The estimated contract value, as
shown on Table B-3.A, for option period 10/01/99 - 9/30/00 in the amount of
$17,699,862 was utilized as the basis for establishing the estimated
contract value for this option period.
B. In addition, this modification incrementally funds this contract with an
additional $2,200,031.00. Table B-12 has been updated to reflect the
allotment of this addition incremental funding.
C. As a result of these changes, Tables B-3.A and B-12 (pages 8.1 and 14) of
the subject contract, as revised, are hereby deleted in their entirety and
the enclosed Tables B-3.A and B-12 (pages 8.1 and 14) are substituted in
lieu thereof.
<PAGE> 203
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
27
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 N. Suite 300 100 S. Biscayne Blvd. 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
[X] B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
FAR 52-243-2 CHANGES COST REIMBURSEMENT (AUG 1989) ALTERNATE I (APR
1984) AND MUTUAL AGREEMENT OF THE PARTIES
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
See Page 2
Except as provided herein, all terms and conditions of the document
referenced in Item 9A or 10A, as heretofore changed, remains unchanged and in
full effect.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 9-9-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 204
NAS10-98001
Modification 27
Page 2 of 2
A. The purpose of this modification is to delete / revise the following Data
Requirements List Documents (DRD):
- ---------------------------------------------------------------------------
DRD # TITLE REV. STATUS
- ---------------------------------------------------------------------------
DRD-002 Metrics Data Report Revised
- ---------------------------------------------------------------------------
DRD-003 NF 533 Revised
- ---------------------------------------------------------------------------
DRD-015 Project Status Report Revised
- ---------------------------------------------------------------------------
DRD-017 Maintenance Status Report Deleted
- ---------------------------------------------------------------------------
DRD-018 Task Order Summary Report Deleted
- ---------------------------------------------------------------------------
DRD-023 Summary Labor Report Deleted
- ---------------------------------------------------------------------------
DRD-024 Task Order Revision Status Report Deleted
- ---------------------------------------------------------------------------
DRD-027 Task Order Procurement Status Revised
Report
- ---------------------------------------------------------------------------
DRD-028 Contractor Workforce and Funding Deleted
Authority Summary Report
- ---------------------------------------------------------------------------
DRD-029 Contractor Resource Management Deleted
Summary and Concerns Report
- ---------------------------------------------------------------------------
DRD-030 Work Plans (Task Order Plans) Revised
- ---------------------------------------------------------------------------
Attachment 1 to this modification provides Section J, Attachment J-1,
Appendix 1, Data Requirements List replacement pages that reflect the
revisions to the DRDs indicated above.
B. In addition, the Section J, Attachment J-3, Wage Determination is hereby
deleted and replaced with Wage Determination No. 94-2118, Revision No. 12,
Dated 05/28/99 which is provided herein as Attachment 2 to this
modification.
C. In order to reflect the exercise of option for the period of 10/1/99 -
9/30/00 accomplished via Modification #26, the first sentence in Section F,
Article F-2 is changed to read as follows: "The period of performance of
this contract, through the exercise of option 2, is October 1,1997 through
September 30, 2000". Replacement page 21 that reflects this new language is
provided herein as Attachment 3.
<PAGE> 205
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
28
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 N. Suite 300 100 S. Biscayne Blvd. 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
|X| C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
FAR 52-243-2 CHANGES COST REIMBURSEMENT (AUG 1989) ALTERNATE I (APR
1984) AND MUTUAL AGREEMENT OF THE PARTIES
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority) Unilateral
Modification in accordance with J-4 EDC Award Fee Evaluation Plan
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
See Page 2
Except as provided herein, all terms and conditions of the document
referenced in Item 9A or 10A, as heretofore changed, remains unchanged and in
full effect.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
Larry Tuttle, Business Manager
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
/S/LARRY TUTTLE 9/22/99
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 9-22-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 206
NAS10-98001
Modification 28
Page 2 of 2
A. The purpose of this modification is to normalize the maximum labor hours
identified in the contract for each optional contract period to reflect
productive labor, inclusive of subcontractor labor hours and overtime, only.
The conversion is necessary to relate the Task Order productive effort to
contract value productive authority for incentive fee evaluation purposes.
The results of this normalization of hours are reflected in the attached
revised contract page 7.1.
B. The estimated cost for the option periods as depicted on page 8.2.1, Table
B-3.A remain unchanged by this modification. However, the direct labor rate
as depicted on page 9.1, Table B-5.B require adjustment for proper
calculation of estimated cost of incremental increase of effort during the
option periods. The results of these rate adjustments are reflected on the
attached revised page 9.1, Table B-5.B.
C. The available award fee and target incentive fee amounts as depicted on page
8.2.1, Table B-3.C remain unchanged by this modification. However, the
available award fee and target incentive fee rates are hereby changed to
reflect the impact of the revised base of productive hours for proper
calculation of available fee for incremental increases of effort during the
option periods. The results of these adjustments are reflected on the
attached revised page 9.1, Table B-5.B.
<PAGE> 207
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
29
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-7
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 N. Suite 300 100 S. Biscayne Blvd. 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
10A. MODIFICATION OF CONTRACT/ORDER NO.
|X| NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 $2,750,355.00 INCREASE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the
contract with an additional $2,750,355.00 as reflected in Table B-12 for
a revised total of $51,108,310.00. Funding is adequate for contract
performance through December 01, 1999.
B. As a result of the above change, page 14 of subject contract, as
revised is deleted and the enclosed page 1 is substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 9-24-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 208
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
30
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-8 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 N. Suite 300 100 S. Biscayne Blvd. 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
|X| 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 $330,000.00 INCREASE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the
contract with an additional $330,000.00 as reflected in Table B-12 for a
revised total of $51,438,310.00. Funding is adequate for contract
performance through December 15, 1999.
B. As a result of the above change, page 14 of subject contract, as
revised, is deleted and the enclosed page 14 is substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 9-30-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 209
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
31
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 N. Suite 300 100 S. Biscayne Blvd. 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
|X| 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/52/00 $2,239,277.00 INCREASE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the
contract with an additional $2,239,277.00 as reflected in Table B-12 for
a revised total of $53,677,587.00. Funding is adequate for contract
performance through January 25, 2000.
B. As a result of the above change, page 14 of subject contract, as
revised, is deleted and the enclosed page 14 is substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 10-20-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 210
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
32
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-8 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 N. Suite 300 100 S. Biscayne Blvd. 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
|X| 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
FAR 52-243-2 CHANGES COST REIMBURSEMENT (AUG 1989) ALTERNATE I (APR
1984) AND MUTUAL AGREEMENT OF THE PARTIES
- --------------------------------------------------------------------------------
X D. OTHER (Specify type of modification and authority) Unilateral
Modification in accordance with J-4 EDC Award Fee Evaluation Plan.
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. This contract modification reflects the performance rating, earned
interest fee, and earned incentive fee for the period October 1, 1998, through
September 30, 1999 as follows:
Rating:95 Earned Award Fee: $674,000 Earned Incentive Fee: $358,600
Total Earned Award / Incentive Fee: $1,032,600
Note: Provisional award fee payments disbursed during this performance period in
the amount of $545,592 are hereby deducted from the earned award / Incentive fee
for a NET AMOUNT DUE OF $487,008.00
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 11-17-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 211
NAS10-98001
Modification No. 32
Page 2 of 2
B. The fee determination reflected above is hereby implemented via the
following changes to the contract:
1. Contract Tables B-3.A, B-3.C, and B-12 are revised to reflect the value
of the earned award/ incentive fee for this period.
2. The contract value for CY2 is adjusted by $31,800, from $24,485,036 to
$24,516,836, to reflect the amount of earned award / incentive fee.
C. The following page changes are made by this modification:
Remove Pages Replace Pages
------------ -------------
8.1 8.1
8.2.1 8.2.1
14 14
In accordance with Contract Article B-3, Contract Value, paragraph E., Earned
Incentive Fee (EIF), the actual cost was derived from the Contractor's September
533 Report for the calculation of EIF. In addition, the EIF depicted on this
modification is considered final and not subject to later adjustment based upon
cost disallowance, final indirect rates or accounting adjustments.
<PAGE> 212
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
33
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 001003 S-1 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 North, Suite 300 100 So. Biscayne Blvd., 7th fl.
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
|X| 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/52/00 $9,755,565.00 INCREASE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the contract with
an additional $9,755,565.00 as reflected in Table B-12 for a revised total of
$63,433,152.00. Funding is adequate for contract performance through May 12,
2000, per Dynacs e-mail dated 12/07/99.
B. As a result of the above change, page 14 of subject contract, as revised, is
deleted and the enclosed page 1[ILLEGIBLE] is substituted in lieu thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 12-13-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 213
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
34
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor Prime Contractor
------------- ----------------
Dynacs Engineering Co., Inc. U. S. Small Business Admin.
35111 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd., 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
X C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
FAR 52.243-2 CHANGES COST REIMBURSEMENT (AUG 1989) ALTERNATE I (APR
1984) AND MUTUAL AGREEMENT OF THE PARTIES
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
See Page 2
Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full effect.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
Larry J. Tuttle, Business Manager
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
/S/LARRY J. TUTTLE 2/22/00
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 2/22/00
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 214
NAS 10-98001
Modification 34
Page 2 of 2
It has been recognized that NASA may require the Contractor to perform design,
contract surveillance, construction, and modification of facilities functions.
It is anticipated that these construction of facilities efforts will be
incidental to the associated research and development activities required under
the Contract. The purpose of this modification is to add this additional scope
to the statement of work and to incorporate the associated contract clauses as
follows:
A. ARTICLE B-12 NFS 1582.232-81 CONTRACT FUNDING (JUN 1990) is revised to apply
the provisions of the "Limitations of Funds" Clause separately to each
construction of facilities effort. A full text version of the revised
contract clause is reflected on the attached revised page 13. In addition, a
new Contract Table B-12 A Facilities Projects: Values and Funding, which
delineates the level of funding provided by NASA for the accomplishment of
each construction effort, is attached as a new contract page 14 A.
B. Contract Section I, ARTICLE I-1, FAR 52.252-2 CLAUSES INCORPORATED BY
REFERENCE (JUN 1988) has been updated to incorporate the FAR Construction
Clauses. The attached replacement / new contract pages 38, 38 A, 38 B, and
39, define these additional clauses.
C. The scope of work as defined in Contract Attachment J-1, Statement of Work,
has been revised to include services for the design, contract surveillance,
construction and modification to facilities. Statement of Work replacement
pages 49, 50, and 51 are attached hereto.
<PAGE> 215
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
35
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 001003 S-2 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 North, Suite 300 100 So. Biscayne Blvd. 7th fl.
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
|X| 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/52/00 MR 001003 S-2 $8,742,217.00 INCREASE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the contract with
an additional $8,742,217.00 as reflected in Table B-12 for a revised total of
$72,175,369.00. Funding is adequate for contract performance through September
30, 2000, per Dynacs e-mail dated February 16, 2000.
B. As a result of the above change, page 14 of subject contract, as revised, is
deleted and the enclosed page 1 [ILLEGIBLE] is substituted in lieu thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 2/16/00
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 216
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
36
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 001003 S-2 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 North, Suite 300 100 So. Biscayne Blvd. 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
|X| 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
X C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
FAR 52.243-2 CHANGES COST REIMBURSEMENT (AUG 1989) ALTERNATE I (APR
1984) AND MUTUAL AGREEMENT OF THE PARTIES
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
The purpose of this modification is to allow rent-free use of the NASA - GSA
vehicles identified in the enclosed change to Contract Attachment J-2. As a
result of this change, page 118 of subject contract, as revised, is deleted and
the enclosed page 118 is substituted in lieu thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
Larry T. Tuttle, Business Manager
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
/S/LARRY T. TUTTLE, 2/22/00
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 3/7/00
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 217
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
1
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-1
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 N. Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
|X| 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40000/34/97/PF Increase $1,315,636.00 MR 971003 S-1
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return ___ copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
Incremental funding is increased by $1,315,636.00 as reflected in the revised
Article B-12, Contract Funding, Table B-12. The funds are estimated to be
adequate through November 17, 1997, per contractor memorandum of September 30,
1997.
Replacement page 13 is attached and should be appropriately inserted in copies
of the contract.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Michael S. McCarty
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/MICHAEL S. MCCARTY 9-30-97
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 218
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
2
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-2
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 N. Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
|X| 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40000/34/97/PF Increase $4,800.00
CW-1/2590C/40000/34/98/PF Increase $926,000.00
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return ___ copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
Incremental funding is increased by $930,800.00 as reflected in the revised
Article B-12, Contract Funding, Table B-12. The funds are estimated to be
adequate through December 10, 1997, per contractor memorandum of October 10,
1997.
Replacement page 13 is attached and should be appropriately inserted in copies
of the contract.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Michael S. McCarty
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/MICHAEL S. MCCARTY 10-10-97
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 219
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
3
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-3
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 N. Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
|X| 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/400000/34/98/PF Increase $1,153,947.00
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return ___ copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
Incremental funding is increased by $1,153,947.00 as reflected in the revised
Article B-12, Contract Funding, Table B-12. The funds are estimated to be
adequate through January 3, 1998, per contractor memorandum of October 30,
1997.
Replacement page 13 is attached and should be appropriately inserted in copies
of the contract.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/BOB R. PIRKLE 10-29-97
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 220
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
4
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-4
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 N. Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
|X| 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/400000/34/97/PF Increase $376,614.00
CW-1/2590C/400000/34/98/PF Increase $2,570,121.00
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return ___ copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
Incremental funding is increased by $2,946,735.00 as reflected in the revised
Article B-12, Contract Funding, Table B-12. The funds are estimated to be
adequate through March 2, 1998, per contractor memorandum of November 21, 1997.
Replacement page 13 is attached and should be appropriately inserted in copies
of the contract.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Michael S. McCarty
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/MICHAEL S. MCCARTY 11-21-97
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 221
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
5
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-5
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 N. Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
|X| 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/400000/34/98/PF Increase $5,642,210
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return ___ copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
Incremental funding is revised by $7,347,118 to $12,989,328 an increase of
$5,642,210 as reflected in the revised Article B-12, Contract Funding, Table
B-12. The funds are estimated to be adequate through July 04, 1998, per
contractor memorandum of January 15, 1998.
Replacement page 13 is attached and should be appropriately inserted in copies
of the contract.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Sharon L. White
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/SHARON L. WHITE 1/22/98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 222
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
6
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-6
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 N. Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
|X| 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/400000/34/98/PF Increase $5,571,875
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
Contact Article B-5
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
Incremental funding is revised by $12,989,328 to $18,561,203 an increase of
$5,571,875 as reflected in the revised Article B-12, Contract Funding, Table
B-12. The funds are estimated to be adequate through September 24, 1998 per
contractor memorandum of April 27, 1998.
Replacement page 13 is attached and should be appropriately inserted in copies
of the contract.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Sharon L. White
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/SHARON L. WHITE 4/28/98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (Rev.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 223
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
7
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-7
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 N. Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
|X| 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/400000/34/98/PF Increase $5,571,875
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
X D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document
and return ___ copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
The purpose of this modifIcation Is to give notice that the parties hereby agree
to convert this contract to a performance based cost-plus-award-fee Incentive
fee contract (completion form task order contract) for the option periods,
commencing with Option 1 on October 1 1998. The Level-of-Effort components of
the contract schedule will be changed to accommodate this change In contract
type. The award fee evaluatIon plan will also be modIfied to reflect the
incentive fee arrangement, and put provisions in the plan which will Include the
assessment of contractor perforrnmnce against performance based contract metrtcs
in the performance evaluation process.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
See Tripartite Signature Page (next page)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
See Tripartite Signature Page (next page)
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
---------------------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 224
NAS10-98001(EDC) Tripartite Signature Page Section A
Contract: NAS10-98001 Mod.No.7
Subcontract: 0455-97-706158 Page 2 of 2
SUBCONTRACTOR:
- --------------
Dynac Engineering Company, Inc.
22870 US Hwy 19, North, Suite 405
Clearwater, FL 34621
BY: /S/RAMEN P. SINGH DATE:6/22/98
NAME AND TITLE: Ramen P. Singh
------------------------
President
------------------------
PRIME CONTRACTOR:
- -----------------
U. S. Small Business Administration
1320 South Dixie Hwy
Coral Gables, FL 33146
BY: __________________________ DATE:____________________
NAME AND TITLE:__________________________
__________________________
PROCURING AND ADMINISTRATIVE OFFICE:
- ------------------------------------
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
BY: __________________________ DATE:____________________
NAME AND TITLE:__________________________
__________________________
2
<PAGE> 225
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
8
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-7
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 North Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-708158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
|X| 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/400000/34/98/PF Increase $2,823,558.00
CW-1/2590C/400000/34/97/PF Increase $ 125,799.00
Total $2,949,352.00
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return ___ copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
Incremental funding is increased by $2,949,352.00 as reflected in the revised
Article B-12, Contract Funding, Table B-12. The funds are estimated to be
adequate through September 30, 1998, per contractor memorandum of June 24,1998.
As a result of the above change, delete page 13 of the contract, and substitute
the enclosed page 13 in lieu thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Rene E. Paquette
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
/S/RENE E. PAQUETTE 6/25/98
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
DUPLICATE ORIGINAL
<PAGE> 226
ARTICLE B-11 COVERAGE OF PRE-EXISTING MEDICAL CONDITIONS
Health insurance provided to incumbent employees hired under this contract
within 30 days of commencing contract performance will include coverage of
pre-existing medical conditions currently covered under the insurance provided
by the incumbent contractor.
ARTICLE B-12 NFS 1852.232-81 CONTRACT FUNDING (JUN 1990) For purposes of payment
of cost, exclusive of fee, pursuant to the Limitation of Funds clause, the total
amount allotted by the Government is defined in Table B-12.
Table B-12
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Basic $16,070,575 $ 500,000 $ 480,769 $ 980,769 $ 19,231 $ 1,000,000 October 22, 1997
1 $ 250,000 $ 1,024,650 $ 1,274,650 $ 40,986 $ 1,315,636 November 17, 1997
2 $ 250,000 $ 654,615 $ 904,615 $ 26,185 $ 930,800 December 10, 1997
3 $ 12,452 $ 1,105,371 $ 1,117,823 $ 36,124 $ 1,153,947 January 3, 1998
4 $ 726,823 $ 2,133,009 $ 2,859,832 $ 86,903 $ 2,946,735 March 5, 1998
5 $ 1,610,156 $ 3,872,422 $ 5,482,578 $ 159,632 $ 5,642,210 July 4, 1998
6 $ 1,671,191 $ 3,847,546 $ 5,518,737 $ 53,137 $ 5,571,875 August 18, 1998
7
8 $2,660,340 $ 289,012 $ 2,949,352 $ 0 $ 2,949,352 September 30, 1998
Total $16,070,575 $7,680,962 $13,407,394 $21,088,356 $ 422,198 $21,510,555 September 30, 1998
</TABLE>
13
<PAGE> 227
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
9
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971003 S-7
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
28870 US Hwy 19 North Suite 405 1320 South Dixie Hwy
Clearwater, FL 34621 Coral Gables, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
|X| 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
N/A
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return ___ copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
THE PURPOSE OF THIS MODIFICATION IS TO CORRECT MODIFICATION #8, BLOCK 12 OF SF
30 and ARTICLE B-12, PAGE 13, LINE ITEM #8 to read a total of $2,949,357 in lieu
of $2,949,352. ARTICLE B-12, PAGE 13, Total Obligation to date should read
$21,510,560 In lieu of $21,510,555.
As a result of the above change, delete page 13 of the contract, and substitute
the enclosed page 13 in lieu thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Rene E. Paquette
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
/S/RENE E. PAQUETTE 6/29/98
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (Rev.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
FAR (48 CFR) 53.243
CONTRACTORS COPY
DUPLICATE ORIGINAL
<PAGE> 228
ARTICLE B-11 COVERAGE OF PRE-EXISTING MEDICAL CONDITIONS
Health insurance provided to incumbent employees hired under this contract
within 30 days of commencing contract performance will include coverage of
pre-existing medical conditions currently covered under the insurance provided
by the incumbent contractor.
ARTICLE B-12 NFS 1852.232-81 CONTRACT FUNDING (JUN 1990)
For purposes of payment of cost, exclusive of fee, pursuant to the Limitation of
Funds clause, the total amount allotted by the Government is defined in Table
B-12.
Table B-12
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Basic $16,070,575 $ 500,000 $ 480,769 $ 980,769 $ 19,231 $ 1,000,000 October 22, 1997
1 $ 250,000 $ 1,024,650 $ 1,274,650 $ 40,986 $ 1,315,636 November 17, 1997
2 $ 250,000 $ 654,615 $ 904,615 $ 26,185 $ 930,800 December 10, 1997
3 $ 12,452 $ 1,105,371 $ 1,117,823 $ 36,124 $ 1,153,947 January 3, 1998
4 $ 726,823 $ 2,133,009 $ 2,859,832 $ 86,903 $ 2,946,735 March 5, 1998
5 $ 1,610,156 $ 3,872,422 $ 5,482,578 $ 159,632 $ 5,642,210 July 4, 1998
6 $ 1,671,191 $ 3,847,546 $ 5,518,737 $ 53,137 $ 5,571,875 August 18, 1998
7
8 $ 2,660,340 $ 289,012 $ 2,949,352 $ 0 $ 2,949,352 September 30,1998
9 $ 0 $ 0 $ 5 $ 0 $ 5 September 30,1998
Total $16,070,575 $ 7,680,962 $13,407,394 $21,088,361 $ 422,198 $21,510,560 September 30,1998
</TABLE>
Modification 9
June 29, 1998
13
<PAGE> 229
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 6
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
10
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 North, Suite 300 100 S. Biscayne Blvd. 7th floor.
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
|X| 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A. CONTRACTOR'S COPY
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
X D. OTHER (Specify type of modification and authority)
Contract Article B-5
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
The purpose of this modification is to:
1. Exercise an option for 134,000 level-of-effort hours.
2. Change the address of the Prime Contractor and Subcontractor
3. Correct Table B-12.
4. Add Table to track option hours exercised.
(See Page 2)
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Rene E. Paquette
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
/s/Rene E. Paquette 7/10/98
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (RevEV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
FAR (48 CFR) 53.243
<PAGE> 230
Page 2 of 6
Mod. No.10
1. Pursuant to Contract Article B-5 OPTIONS TO EXTEND THE PERIOD OF CONTRACT
AND OPTIONS FOR INCREMENTAL INCREASE OF EFFORT, The Government unilaterally
increases the number of man-hours required by 134,000 for the period October
1, 1997 through September 30, 1998. A table for tracking exercised option
hours has been incorporated in this article.
2. Contract Article B-3, CONTRACT VALUE, For the period 10/1997 through 9/30/98
is increased by $3,615,320 (134,000 option man-hours @ the contract option
hours labor rate of $26.98 - no fee).
3. Contract Article B-12, NFS 1852.232-8 1 CONTRACT FUNDING (JUN 1990). The
columns for Cost Other and Total Cost & Fee are corrected to reflect error
in addition on a previous modification.
4. Address changes on both the prime and subcontractor are made on the SF30.
As a result of the above changes, pages 7, 8,9 and 13 of said contract, as
modified, are deleted and replacement pages 7, 8,9 and 13 are substituted
in lieu thereof.
<PAGE> 231
NASIO-98001 (EDC) Section B
PART I - THE SCHEDULE
Section B
Supplies or Services and Prices/Cost
------------------------------------
ARTICLE B-1 TYPE OF CONTRACT
This is a cost-plus-award-fee, term form of contract with a level of effort
basis. The Contractor is obligated to provide Engineering, Engineering Support,
and Facilities and Laboratory Support. Specific requirements will be levied on
the Contractor by Work Orders in accordance with the Statement of Work (SOW),
Attachment J-1.
ARTICLE B-2 EFFORT REOUIRED DURING CONTRACT PERFORMANCE
A. The Contractor shall provide non-personal services for NASA as described in
Article C-1 "Scope of Work" and Attachment J-l, "Statement of Work" on a
level of effort (LOE) basis. In performance of the described work during the
contract period set forth below, the Contractor shall not exceed the total
labor hours on the contract, including subcontractor and overtime hours.
Table B-2
- ---------------------------------------------------------------
Labor Hours
Contract Period Minimum Target Maximum
- ---------------------------------------------------------------
10/1/97 - 9/30/98 375,502 387,115 398.728
Mod. No 10 134,000
Total 532,728
Option Periods
10/1/98 - 9/30/99 375,502 387.115 398,728
10/1/99 - 9/30/00 375,502 387,115 398,725
10/1/00 - 9/30/01 375,502 387,115 398,728
10/1/01 - 9/30/02 375,502 387,115 398,728
B. If the Contractor has not provided the specified minimum quantity of total
contract labor hours set forth in the above paragraph A, an equitable
downward adjustment will be made in estimated cost and available award fee.
The downward adjustment will be based on the difference between the minimum
labor hours specified under this Article and the number of labor hours
provided by the Contractor. This provision does not affect the Government's
right to reduce the quantity of labor hours during the term of this contract
pursuant to the Termination Clause (FAR 52.249-6).
C. When the total labor hours expended reach 95% of the maximum labor hours
specified above, the Contractor shall notify the Contracting Officer as to
whether or not the Contractor believes that amount will be sufficient for
the balance of the period of performance, or if additional labor hours will
be required. In the latter case, the notification shall include the
estimated "adequate through" date for the unexpended balance and an estimate
of the additional hours required for the balance of the period of
performance. If during the term of the contract, an increase in the
specified maximum number of labor hours becomes necessary, the Government
may elect to increase the
D. As used herein, the term "labor hours" shall include the productive and
non-productive time of the employees assigned to this contract (including
subcontracted and overtime labor hours.)
<PAGE> 232
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
ARTICLE B-3 CONTRACT VALUE
--------------
A. The contract value is comprised of estimated cost and award fee as shown
in Table B-3. The Contractor may earn award fee at the end of the twelve
month basic period of performance and any twelve month option period, if
exercised.
Table B-3
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------
Estimated Available Earned Award Adjective Contract
Contract Period Cost Award Fee Fee Score Rating Value
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
10/1/97 - 9/30/98 $15,648,377 $ 422,198 $ TBD TBD TBD $16,070,575
Mod No 10 $ 3,615,320 $ 0 $ 3,615,320
----------- ----------- -----------
$19,263,697 $ 422,198 $ TBD TBD TBD $19,685,895
=========== =========== ===========
Option Periods
10/1/98 - 9/30/99 $15,928,312 $ 433,396 $ TBD TBD TBD $16,361,708
----------- ----------- -----------
10/1/99 - 9/30/00 $16,221,875 $ 445,138 $ TBD TBD TBD $16,667,013
----------- ----------- -----------
10/1/00 - 9/30101 $16,546,972 $ 458,142 $ TBD TBD TBD $17,005,114
----------- ----------- -----------
10/1/01 - 9/30/02 $16,881,876 $ 471,538 $ TBD TBD TBD $17,353,414
----------- ----------- -----------
</TABLE>
The fee allocation rate for optional labor hours exercised pursuant to Article
B-5 shall be the rate applicable to the current contract period as specified
therein.
ARTICLE B-4 OTHER DIRECT COSTS
------------------
Notwithstanding the provisions of Article G-7 entitled "Base Support", the
Contractor may be required to provide Work Order related items identified in, or
required by, Work Orders issued in accordance with Attachment J-1, Appendix 3
"Work Order Procedure." These items, classified as Other Direct Costs, include,
but are not limited to, materials, supplies, equipment, maintenance services,
travel, and training. This action is authorized only if such items/services are
not available pursuant to Article G-7 entitled "Base Support." The estimated
cost of this contract includes the amount of $5,000,000 in the basic contract
period and $5,000,000 in each of the four option periods for the acquisition of
such items or services. The costs covered by this article shall be separately
accumulated and reported in accordance with DRD-003. Such costs are considered
non-fee-bearing.
ARTICLE B-5 OPTIONS TO EXTEND THE PERIOD OF CONTRACT AND
--------------------------------------------
OPTIONS FOR INCREMENTAL INCREASE OF EFFORT
--------------------------------------------
A. Options to Extend the Period of Contract
1. This contract is renewable for the periods identified as options
in Table B-3 at the option of the Government.
2. The Government may extend the term of the contract for the
quantities of supplies or services and period specified in the
Schedule by written modification of this contract before the
current contract performance period expires, provided that the
Government will give the Contractor a preliminary written notice
of intent to extend at least 60 days prior to expiration of any
current period of performance. The preliminary notice does not
commit the Government to exercise the option.
3. If the Government exercises any Option, the extended contract
shall be considered to include this option provision.
Modification No. 10
Page 4 of 6
<PAGE> 233
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
4. The total duration of this contract, including the exercise of
any option(s) under this clause, shall not exceed five (5)
years. 5. It is understood and agreed that any continued
performance of services from period to period shall be at the
sole determination of the Government and will be contingent upon
prior satisfactory performance. Failure to renew the contract
for any subsequent period of performance shall not be considered
as a termination for the convenience of the Government.
B. Options for Incremental Increase of Effort
The Government may unilaterally increase the number of labor hours
required to be furnished pursuant to Article B-2, during any one year
period of performance, by an amount ranging from 1 to 1,935,575 labor
hours; provided that the cumulative total of option hours exercised does
not exceed I 93 5,575 labor hours for the five year contract period. If
the Government elects to exercise its option to increase the number of
labor hours, the Contractor will be notified by a contract modification
executed by the Contracting Officer. If any option is exercised, the
number of minimum, target, and maximum labor hours set forth in Table
B-2 will be increased by the number of hours exercised. The estimated
cost and available award fee in Article B-3 will be increased as follows
for each additional labor hour exercised:
If Exercised During the Period Option Labor Rate Option Fee Rate
------------------------------ ----------------- ---------------
10/01/97-09/30/98 $ 26.98 $ 0.00
------- -------
10/01/98-09/30/99 $ 27.70 $ 0.00
------- -------
l0/01/99-09/30/00 $ 28.45 $ 0.00
------- -------
l0/0l/00-09/30/0l $ 29.28 $ 0.00
------- -------
10/0l/0l-09/30/02 $ 30.14 $ 0.00
------- -------
Failure to exercise any option of the contract shall not be considered
as a termination for the convenience of the Government, If the
Government exercises one or any of the options under this contract, the
contract, as amended, shall include all terms and conditions of the
contract as it exists immediately prior to the exercise of the
additional option(s).
For historical tracking purposes, the following table is established to
document the amount of man-hours exercised to date and the optional
man-hours remaining available:
Option Hours at Award: 1,193,575
(134,000) (exercised via modification #10)
---------
Balance 1,059,575
ARTICLE B-6 OPTIONS FOR OTHER DIRECT COSTS
------------------------------
In addition to the amount for ODC included in Article BA as part of the basic
contract, the Government may increase the amount available for payment of Work
Order related items identified in, or required by, Work Orders issued in
accordance with Attachment J-1, Appendix 3 "Work Order Procedure" by not more
than the total shown below. These items, classified as Other Direct Costs,
include, but are not limited to materials, supplies, equipment, maintenance
services, travel and training. If the Government elects to exercise its option
to increase the amount available for ODC, the Contractor will be notified by a
unilateral Contract Modification executed by the Contracting Officer. Options
increasing the amounts available for ODC may be exercised one or more times, at
any time during the performance penod of this contract, provided that the
cumulative total estimated cost exercised does not exceed the amount shown
below. The estimated cost in Article B-3 will be adjusted to reflect the amount
of option exercised.
Modification No. 10
Page 5 of 6
<PAGE> 234
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
ARTICLE B-11 COVERAGE OF PRE-EXISTING MEDICAL CONDITIONS
-------------------------------------------
Health insurance provided to incumbent employees hired under this contract
within 30 days of commencing contract performance will include coverage of
pre-existing medical conditions currently covered under the insurance provided
by the incumbent contractor.
ARTICLE B-12 NFS 1852.232-81 CONTRACT FUNDING (JUN 1990)
------------------------------------------
For purposes of payment of cost, exclusive of fee, pursuant to the Limitation
of Funds clause, the total amount allotted by the Government is defined in Table
B-12.
Table B-12
<TABLE>
<CAPTION>
Contract Cost Total Cost Adequate
Mod Value ODC Other Total Fee & Fee ThruDate
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Basic 16,070,575 500,000 480,769 980,769 19,231 1,000,000 22-Oct-97
1 250,000 1,024,650 1,274,650 40,986 1,315,636 17-Nov-97
2 250,000 654,615 904,615 26,185 930,800 10-Dec-97
3 12,452 1,105,371 1,117,823 36,124 1,153,947 3-Jan-98
4 726,823 2,133,009 2,859,832 86,903 2,946,735 5-Mar-98
5 1,610,156 3,872,422 5,482,578 159,632 5,642,210 4-Jul-98
6 1,671,191 3,847,546 5,518,737 53,137 5,571,874 18-Aug-98
8 2,660,340 289,012 2,949,352 0 2,949,352 30-Sep-98
9 0 5 5 0 5 30-Sep-98
10 $3,615,320 $0 $0 $0 $0 $0
- ------------------------------------------------------------------------------------------------
Total $19,685,895 $7,680,962 $13,407,399 $21,088,361 $422,198 $21,510,559 30-Sep-98
</TABLE>
Modification 10
Page 6 of 6
<PAGE> 235
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 4
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
11
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Co., Inc. U. S. Small Business Admin.
3511 US Highway 19 N., Suite 300 100 S. Biscayne Blvd., 7th Floor
Palm Harbour, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
X C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
FAR 52.243-2 CHANGES - COST - REIMBURSEMENT (AUG 1987) ALT II (APR 1984)
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document
and return copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
The purpose of this Supplemental Agreement is to incorporate additional "Year
2000 Compliance" requirements in the contract.
As a result of the above change, page 52 of subject contract, as modified is
hereby deleted, and the attached replacement page 52 and new page 52.1 are
substituted in lieu thereof.
The Contractor agrees that the contract change made herein result in no
increases or decreases to the estimated cost and fee of the contract.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 236
Notification No. 11
NAS10-98001 (EDC) Attachment J-1
- --------------------------------------------------------------------------------
Items or services acquired under this contract are required to include
accurate processing of the date and date-related data (including but not
limited to calculating, comparing, and sequencing) by all hardware and
software products delivered under this contract, individually and in
combination, upon installation. This also includes the manipulation of
data with dates prior to, through, and beyond January 1, 2000, and shall
be transparent to the use.
Hardware and software products provided under this contract shall,
individually, and in combination, successfully transition into the Year
2000 with the correct system date, without human intervention, including
leap year calculations. Such products shall also provide correct results
when moving forward or backward in time across the Year 2000 or
subsequent years.
Year 2000 Compliance
--------------------
(a) "Year 2000 compliant," as used herein, means that the
information technology (hardware, software and firmware,
including embedded systems or any other electro-mechanical or
processor-based systems used in accordance with its associated
documentation) accurately processes date and date-related data
(including, but not limited to, calculating, comparing and
sequencing) from, into, and between the twentieth and
twenty-first centuries, and the years 1999 and 2000 and leap
year calculations, to the extent that other information
technology, used in combination with the information technology
being acquired, property exchanges date and date-related data
with it
(b) Any information technology provided, operated and/or maintained
under this contract must be Year 2000 compliant To ensure this
result, the Contractor shall provide documentation describing
bow the IT items or services demonstrate Year 2000 compliance,
consisting of: a certification document signed by the vendor
and/or original equipment manufacturer for commercial items. For
IT items or services developed or built, or commercial items
integrated into a viable package by the contractor, the
contractor shall provide a certification document and integrated
test results demonstrating Year 2000 compliance.
(c) Milestones for Renovation, Validation and Implementation: Any IT
determined to be non-Year 2000 compliant shall be replaced,
retired, or repaired in accordance with the following schedule:
1. "Renovation" includes making and documenting software
and hardware changes, developing replacement systems,
and decommissioning systems to be retired. The
Contractor must complete renovation of affected
software, hardware and firmware by September 30, 1998.
2. "Validation" includes unit, integration, system and
end-to-end testing for Year 2000 compliance. The
Contractor must complete validation and testing of
converted or replaced systems by January 31, 1999.
3. "Implementation" includes acceptance testing and
integration of converted and replaced systems into a
production environment The Contract must complete
implementation by March 31, 1999.
(d) At a minimum, the Contractor shall provide documentation,
including project plans and status reports, which demonstrate
that the Contractor is meeting the milestones listed above.
52
<PAGE> 237
NAS10-98001 (EDC) Section A
- --------------------------------------------------------------------------------
Tripartite Signature Page
Contract: NAS 10-98001
Subcontract: 0455-97-706158
- --------------------------------------------------------------------------------
SUBCONTRACTOR:
- --------------
Dynacs Engineering Company, Inc.
35111 US Hwy 19, North, Suite 300
Palm Harbor, FL 34684
BY: /S/ RAMEN P. SINGH DATE: 7/24/98
NAME AND TITLE: ___________________________
___________________________
- --------------------------------------------------------------------------------
PRIME CONTRACTOR:
- -----------------
U.S. Small Business Administration
100 S. Biscayne Blvd., 7th floor
Miami, FL 33131
BY: /S/ G. REY MORAN DATE: 8/3/98
NAME AND TITLE: G. REY MORAN
U.S. Small Business Administration
Contracting Officer
- --------------------------------------------------------------------------------
PROCURING AND ADMINISTRATIVE OFFICE:
- ------------------------------------
John F. Kennedy Space Center, NASA
Procurement Office, OP-OSO
Kennedy Space Center, FL 32899
BY: /S/ RENE E. PAQUETTE DATE: 8/10/98
NAME AND TITLE: RENE E. PAQUETTE
CONTRACTING OFFICER
2
<PAGE> 238
Subcontract: 0455-97-706158
- --------------------------------------------------------------------------------
SUBCONTRACTOR:
- --------------
Dynacs Engineering Company, Inc.
35111 US Hwy 19, North, Suite 300
Palm Harbor, FL 34684
BY: /S/ RAMEN P. SINGH DATE: 7/24/98
NAME AND TITLE:___________________________
___________________________
- --------------------------------------------------------------------------------
PRIME CONTRACTOR:
- -----------------
U.S. Small Business Administration
100 S. Biscayne Blvd., 7th floor
Miami, FL 33131
BY:_____________________________________ DATE:_______________________
NAME AND TITLE:_________________________
_________________________
- --------------------------------------------------------------------------------
PROCURING AND ADMINISTRATIVE OFFICE:
- ------------------------------------
John F. Kennedy Space Center, NASA
Procurement Office, OP-OSO
Kennedy Space Center, FL 32899
BY:____________________________________ DATE:________________________
NAME AND TITLE:________________________
________________________
2
<PAGE> 239
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 7
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
12
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Co., Inc. U. S. Small Business Admin.
3511 US Highway 19 N., Suite 300 100 S. Biscayne Blvd., 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (d) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to reflect a cost variance between the
negotiated estimated cost and the estimated cost to complete the work which
resulted from the skill mix requirements driven by the Government Task Orders
from contract inception to September 30, 1998. This interim adjustment is made
to align contract value with cumulative contract costs and funding.
B. As a result of the above changes, pages 7, 8, 9, 13 and 14 of the contract
are hereby deleted and new pages 7, 8, 9, 9.1, 13 and 14 are substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Rene E. Paquette
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ RENE E. PAQUETTE 9/28/98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 240
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
PART I - THE SCHEDULE
Section B
Supplies or Services and Prices/Cost
ARTICLE B-1 TYPE OF CONTRACT
This is a cost-plus-award-fee, term form of contract with a level of effort
basis. The Contractor is obligated to provide Engineering, Engineering Support,
and Facilities and Laboratory Support. Specific requirements will be levied on
the Contractor by Work Orders in accordance with the Statement of Work (SOW),
Attachment J-1.
ARTICLE B.2 EFFORT REQUIRED DURING CONTRACT PERFORMANCE
A. The Contractor shall provide non-personal services for NASA as described
in Article C-1, "Scope of Work" and Attachment J-1, "Statement of Work"
on a level of effort (LOE) basis. In performance of the described work
during the contract period set forth below, the Contractor shall not
exceed the total labor hours on the contract, including subcontractor
and overtime hours.
Table B-2
-------------------------------------------------------------
Labor Hours
Contract Period Minimum Target Maximum
-------------------------------------------------------------
10/1/97 - 9/30/98 375,502 387,115 398,728
Mod. No 10 134,000
Total 532,728
Option Periods
10/1/98 - 9/30/99 375,502 387,115 398,728
10/1/99 - 9/30/00 375,502 387,115 398,728
10/1/00 - 9/30/01 375,502 387,115 398,728
10/1/01 - 9/30/02 375,502 387,115 398,728
B. If the Contractor has not provided the specified minimum quantity of
total contract labor hours set forth in the above paragraph A, an
equitable downward adjustment will be made in estimated cost and
available award fee. The downward adjustment will be based on the
difference between the minimum labor hours specified under this Article
and the number of labor hours provided by the Contractor. This provision
does not affect the Government's right to reduce the quantity of labor
hours during the term of this contract pursuant to the Termination
Clause (FAR 52.249-6).
C. When the total labor hours expended reach 95% of the maximum labor hours
specified above, the Contractor shall notify the Contracting Officer as
to whether or not the Contractor believes that amount will be sufficient
for the balance of the period of performance, or if additional labor
hours will be required. In the latter case, the notification shall
include the estimated "adequate through" date for the unexpended balance
and an estimate of the additional hours required for the balance of the
period of performance. If, during the term of the contract, an increase
in the specified maximum number of labor hours becomes necessary, the
Government may elect to increase the maximum labor hours pursuant to
Article B-5, "Options to Extend the Period of Contract and Options for
Incremental Increase of Effort".
Modification No. 12
Page 2 of 7
<PAGE> 241
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
D. As used herein, the term "labor hours" shall include the productive and
non-productive time of the employees assigned to this contract
(including subcontracted and overtime labor hours).
ARTICLE B-3 CONTRACT VALUE
A. The contract value is comprised of estimated cost and award fee as shown
in Table B-3. The Contractor may earn award fee at the end of the twelve
month basic period of performance and any twelve month option period, if
exercised.
Table B-3
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------
Estimated Available Earned Award Adjective Contract
Contract Period Cost Award Fee Fee Score Rating Value
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
10/1/97-9/30/98 $15,648,377 $422,198 $ TBD TBD TBD $16,070,575
Mod No 10 $3,615,320 $0 $3,615,320
Mod No 12 $2,049,191 ($22,198) $ TBD TBD TBD $2,026,993
---------- -------- -----------
Total $21,312,888 $400,000 $21,712,888
Option Periods
10/1/98 - 9/30/99 $15,928,312 $433,396 $ TBD TBD TBD $16,361,708
---------- -------- -----------
10/1/99 - 9/30/00 $16,221,875 $445,138 $ TBD TBD TBD $16,667,013
---------- -------- -----------
10/1/00 - 9/30/01 $16,546,972 $458,142 $ TBD TBD TBD $17,005,114
---------- -------- -----------
10/1/01 - 9/30/02 $16,881,876 $471,538 $ TBD TBD TBD $17,353,414
---------- -------- -----------
</TABLE>
The fee allocation rate for optional labor hours exercised pursuant to
Article B-5 shall be the rate applicable to the current contract period
as specified therein.
ARTICLE B-4 OTHER DIRECT COSTS
Notwithstanding the provisions of Article G-7 entitled "Base Support", the
Contractor may be required to provide Work Order related items identified in, or
required by, Work Orders issued in accordance with Attachment J-1, Appendix 3
"Work Order Procedure." These items, classified as Other Direct Costs, include,
but are not limited to, materials, supplies, equipment, maintenance, services,
travel, and training. This action is authorized only if such items/services are
not available pursuant to Article G-7 entitled "Base Support." The estimated
cost of this contract includes the amount of $5,000,000 in the basic contract
period and $5,000,000 in each of the four option periods for the acquisition of
such items or services. The costs covered by this article shall be separately
accumulated and reported in accordance with DRD-003. Such costs are considered
non-fee-bearing.
Modification No. 12
Page 3 of 7
8
<PAGE> 242
NAS10-98001 (EDC) Section B
- --------------------------------------------------------------------------------
ARTICLE B-5 OPTIONS TO EXTEND THE PERIOD OF CONTRACT AND
OPTIONS FOR INCREMENTAL INCREASE OF EFFORT
A. Options to Extend the Period of Contract
1. This contract is renewable for the periods identified as options
in Table B-3 at the option of the Government.
2. The Government may extend the term of the contract for the
quantities of supplies or services and period specified in the
Schedule by written modification of this contract before the
current contract performance period expires, provided that the
Government will give the Contractor a preliminary written notice
of intent to extend at least 60 days prior to expiration of any
current period of performance. The preliminary notice does not
commit the Government to exercise the option.
3. If the Government exercises any option, the extended contract
shall be considered to include this option provision.
4. The total duration of this contract, including the exercise of
any option(s) under this clause, shall not exceed five (5)
years.
5. It is understood and agreed that any continued performance of
services from period to period shall be at the sole
determination of the Government and will be contingent upon
prior satisfactory performance. Failure to renew the contract
for any subsequent period of performance shall not be considered
as a termination for the convenience of the Government.
B. Options for Incremental Increase of Effort
The Government may unilaterally increase the number of labor hours
required to be furnished pursuant to Article B-2, during any one year
period of performance, by an amount ranging from 1 to 1,935,575 labor
hours; provided that the cumulative total of option hours exercised does
not exceed 1,935,575 labor hours for the five year contact period. If
the Government elects to exercise its option to increase the number of
labor hours, the Contractor will be notified by a contact modification
executed by the Contracting Officer. If any option is exercised, the
number of minimum, target, and maximum labor hours set forth in Table
B-2 will be increased by the number of hours exercised. The estimated
cost and available award fee in Article B-3 will be increased as follows
for each additional labor hour exercised:
If Exercised During the Period Option Labor Rate Option Fee Rate
------------------------------ ----------------- ---------------
10/01/97 - 09/30/98
Prime Contractor $29.22 (loaded) $0.00
Subcontractors $48.84 (loaded) $0.00
-------------- -----
10/01/98 - 09/30/99 $27.70 $0.00
------ -----
10/0l/99 - 09/30/00 $28.45 $0.00
------ -----
10/01/O0 - 09/30/0l $29.28 $0.00
------ -----
Modification No. 12
Page 4 of 7
9
<PAGE> 243
NASIO-98001 (EDC) Section B
- --------------------------------------------------------------------------------
Failure to exercise any option of the contract shall not be considered
as a termination for the convenience of the Government. If the
Government exercises one or any of the options under this contract, the
contract, as amended, shall include all terms and conditions of the
contract as it exists immediately prior to the exercise of the
additional option(s).
For historical tracking purposes, the following table is established to document
the amount of man-hours exercised to date and the optional man-hours remaining
available:
Option Hours at Award: 1,935,575
Exercised via Modification No. 10 (134,000)
--------
Balance 1,801,575
ARTICLE B-6 OPTIONS FOR OTHER DIRECT COSTS
In addition to the amount for ODC included in Article B4 as part of the basic
contract, the Government may increase the amount available for payment of Work
Order related items identified in, or required by, Work Orders issued in
accordance with Attachment J-1, Appendix 3 "Work Order Procedure" by not more
than the total shown below. These items, classified as Other Direct Costs,
include, but are not limited to materials, supplies, equipment, maintenance
services, travel and training, If the Government elects to exercise its option
to increase the amount available for ODC, the Contractor will be notified by a
unilateral Contract Modification executed by the Contracting Officer. Options
increasing the amounts available for ODC may be exercised one or more times, at
any time during the performance period of this contract, provided that the
cumulative total estimated cost exercised does not exceed the amount shown
below. The estimated cost in Article B-3 will be adjusted to reflect the amount
of option exercised.
-9.1-
Modification No. 12
Page 5 of 7
<PAGE> 244
NASIO-98001 (EDC) Section B
- --------------------------------------------------------------------------------
ARTICLE B-11 COVERAGE OF PRE-EXISTING MEDICAL CONDITIONS
Health insurance provided to incumbent employees hired under this contract
within 30 days of commencing contract performance will include coverage of
pre-existing medical conditions currently covered under the insurance provided
by the incumbent contractor.
ARTICLE B-12 NFS 1852.232-81 CONTRACT FUNDING (JUN 1990)
For purposes of payment of cost, exclusive of fee, pursuant to the Limitation of
Funds clause, the total amount allotted by the Government is defined in Table
B-12, Contract Value and Funding.
13 Modification No. 12
Page 6 of 7
<PAGE> 245
Table B-12 CONTRACT VALUE & FUNDING
<TABLE>
<CAPTION>
CONTRACT FUNDING
---------------------------------------------------------------------------------------
CONTRACT CONTRACT ALL OTHER TOTAL COST ADEQUATE
MOD VALUE ODC COSTS TOTAL COSTS FEE AND FEE THRU DATE
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Basic $16,070,575 $500,000 $480,769 $980,769 $19,231 $1,000,000 10/22/97
1 250,000 1,024,650 1,274,650 40,986 1,315,636 11/17/97
2 250,000 654,615 904,615 26,185 930,800 12/10/97
3 12,452 1,105,371 1,117,823 36,124 1,153,947 01/03/98
4 726,823 2,133,009 2,859,832 86,903 2,946,735 03/05/98
5 1.610,156 3,872,422 5,482,578 159,632 5,642,210 07/04/98
6 1,671,191 3,847,546 5,518,737 53,137 5,571,874 08/18/98
8 2,660,340 289,012 2,949,352 2,949,352 09/30/98
9 5 5 5 09/30/98
10 3,615,320
12 2,026,993 22,198 22,198 -22,198
Totals:$21,712,888 $7,680,962 $13,429,597 $21,110,559 $400,000 $21,510,559 09/30/98
</TABLE>
Modification No. 12
Page 7 of 7
<PAGE> 246
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
NAS 10-98001
PAGE OF PAGES
1 3
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
13
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Page 3
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Highway 19 N., Suite 300 100 S. Biscayne Blvd., 7th Floor
Palm Harbour, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
N/A
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
X C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
Article H-15, Performance Based Work Orders
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document
and return copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to convert the present Level Of Effort
contract to a Performance Based Contract (PBC) pursuant to Contract Article H-15
"Performance Based Work Orders" and the terms of contract modification number 7
of this contract.
- --------------------------------------------------------------------------------
See Tripartite Signature Page
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
See Tripartite Signature Page
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 247
B. The following page changes are made by this modification to reflect the
agreements reached on September 24, 1998 to implement application of the PBC
arrangement:
Remove Pages Replace With/Add Pages
------------ ----------------------
5 5
7 7
- 7.1
8 8
- 8.1
- 8.2
- 8.3
- 8.4
- 8.5
9 9
- 9.1
10 10
11 11
13 13
14 14
43 43
<PAGE> 248
NAS 10-98001
Mod # 13
Page 3 of 3
Tripartite Signature Page
- --------------------------------------------------------------------------------
SUBCONTRACTOR:
- --------------
Dynacs Engineering Company, Inc.
35111 US Hwy 19, North, Suite 300
Palm Harbor, FL 34684
BY: /S/ R. P. SINGH DATE: 9/24/98
NAME AND TITLE: R. P. Singh
President
- --------------------------------------------------------------------------------
PRIME CONTRACTOR:
- -----------------
U.S. Small Business Administration
100 S. Biscayne Blvd., 7th floor
Miami, FL 33131
BY: /S/ G. Rey Moran DATE: 9/28/98
NAME AND TITLE: G. Rey Moran
Contracting Officer
- --------------------------------------------------------------------------------
PROCURING AND ADMINISTRATIVE OFFICE:
- ------------------------------------
John F. Kennedy Space Center, NASA
Procurement Office, OP-OSO
Kennedy Space Center, FL 32899
BY: /S/ Marlo F. Krisberg DATE: 9/29/98
NAME AND TITLE: Marlo F. Krisberg
Contracting Officer
<PAGE> 249
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 3
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
13
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Page 3
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor Prime Contractor:
Dynacs Engineering Co., Inc. U. S. Small Business Administration
3511 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd., 7th Floor
Palm Harbour, FL 34684 Miami, FL 33146
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
N/A
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
X C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
Article H-15, Performance Based Work Orders
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to convert the present Level Of Effort
contract to a Performance Based Contract (PBC) pursuant to Contract Article H-15
"Performance Based Work Orders" and the terms of contract modification number 7
of this contract.
- --------------------------------------------------------------------------------
See Tripartite Signature Page See Tripartite Signature Page
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
[ILLEGIBLE]NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
FAR (48 CFR) 53.243
<PAGE> 250
[ILLEGIBLE]
Mod #13
Page 2 of 3
B. The following page changes are made by this modification to reflect the
agreements reached on September 24, 1998 to implement application of the PBC
arrangement
Remove Pages Replace With/Add Pages
------------ ----------------------
5 5
7 7
- 7.1
8 8
- 8.1
- 8.2
- 8.3
- 8.4
- 8.5
9 9
- 9.1
10 10
11 11
13 13
14 14
43 43
<PAGE> 251
NAS 10-98001
Mod #13
Page 3 of 3
Tripartite Signature Page
- --------------------------------------------------------------------------------
SUBCONTRACTOR:
- --------------
Dynacs Engineering Company, Inc.
35111 US Hwy 19, North, Suite 300
Palm Harbor, FL 34684
BY: /S/ R. P. SINGH DATE: 9/24/98
PRESIDENT
NAME AND TITLE: R. P. Singh, President
- --------------------------------------------------------------------------------
PRIME CONTRACTOR:
- -----------------
U.S. Small Business Administration
100 S. Biscayne Blvd., 7th floor
Miami, FL 33131
BY: /S/ G. Rey Moran DATE:__________________
NAME AND TITLE: ____________________________
____________________________
- --------------------------------------------------------------------------------
PROCURING AND ADMINISTRATIVE OFFICE:
- ------------------------------------
John F. Kennedy Space Center, NASA
Procurement Office, OP-OSO
Kennedy Space Center, FL 32899
BY: /S/ Marlo F. Krisberg DATE: ________________
NAME AND TITLE:_______________________________
_______________________________
<PAGE> 252
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
14
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 971004/S-8
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Co., Inc. U. S. Small Business Admin.
3511 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd., 7th Floor
Palm Harbour, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590/400000/34/98/PF Increase $1,738,706
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
The purpose of this modification is incrementally fund the contract for an
additional $1,738,706 as reflected in Table B-12 for a new total of $25,005,521.
Funding is adequate for contract performance through October 31, 1998.
B. As a result of the above change, page 14 of subject contract, as revised, is
hereby deleted and the enclosed page 14 is substituted in lieu thereof.
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Rene E. Paquette
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ RENE E. PAQUETTE 9/30/98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 253
NAS10-98001
Mod. #14
Page 14
Table B-12 CONTRACT VALUE & FUNDING
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
CONTRACT FUNDING
--------------------------------------------------------------------------------
CONTRACT CONTRACT ALL OTHER TOTAL COST ADEQUATE
MOD VALUE ODC COSTS TOTAL COSTS FEE AND FEE THRU DATE
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Basic $16,070,575 $ 500,000 $ 480,769 $ 980,769 $ 19,231 $ 1,000,000 10/22/97
1 250,000 1,024,650 1,274,650 40,986 1,315,636 11/17/97
2 250,000 654,615 904,615 26,185 930,800 12/10/97
3 12,452 1,105,371 1,117,823 36,124 1,153,947 01/03/98
4 726,823 2,133,009 2,859,832 86,903 2,946,735 03/05/98
5 1,610,156 3,872,422 5,482,578 159,632 5,642,210 07/04/98
6 1,671,191 3,847,546 5,518,737 53,137 5,571,874 08/18/98
8 2,660,340 289,012 2,949,352 2,949,352 09/30/98
9 5 5 5 09/30/98
10 3,615,320
12 2,026,993 22,198 22,198 -22,198
13
14 -2,446,751 4,099,097 1,652,346 86,360 1,738,706 10/31/98
Totals: $21,712,888 $ 5,234,211 $ 17,528,694 $ 22,762,905 $ 486,360 $ 23,249,265 10/31/98
</TABLE>
<PAGE> 254
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 3
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
15
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Co., Inc. U. S. Small Business Administration
35111 US Hwy 19 N. Suite 300 100 S. Biscayne Blvd., 7th Floor
Palm Harbor, FL 34621 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CONTRACTOR'S COPY
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A. DUPLICATE ORIGINAL
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
X D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
The purpose of this modification is to exercise the option period commencing
October 1, 1998 through September 30, 1999.
As a result of the above change, pages 8.1 and 14 of subject contract, as
revised, are hereby deleted and the enclosed pages 8,1 and 14 are substituted in
lieu thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
A. Earl Gilbert
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ A. EARL GILBERT 9/30/98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
FAR (48 CFR) 53.243
<PAGE> 255
NAS10-98001
Mod #15
Page 8.1
Table B-3 CONTRACT VALUE
<TABLE>
<CAPTION>
AVAILABLE EARNED TARGET EARNED AWARD
CONTRACT ESTIMATED AWARD AWARD INCENTIVE INCENTIVE CONTRACT FEE ADJECTIVE
PERIOD COST FEE FEE FEE FEE VALUE* SCORES RATING
- -------------------- ----------- ----------- ------ --------- --------- ----------- ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
CY1:10/01/97-9/30/98
Initial award $15,648,377 $ 422,198 TBD N/A N/A $16,070,575 TBD TBD
Mod #10 3,615,320 0 N/A N/A 3,615,320
Adj. Values: 19,263,697 422,198 N/A N/A 19,685,895
Mod #12 2,049,191 -22,198 2,026,993
Total CYI: 21,312,888 400,000 21,712.888
CY2:10/01/98 - 09/30/99
Mod #14 16,648,462 444,500 TBD 185,500 TBD 17,278,462 TBD TBD
Contract totals: 37,052,362 844,500 185,500 N/A 38,991,350
Option Periods
10/01/99 - 09/30/00 17,052,362 458,000 TBD 189,000 TBD 17,699,862 TBD TBD
10/01/00 - 09/30/01 17,468,442 476,000 TBD 189,000 TBD 18,133,442 TBD TBD
10/01/01 - 09/30/02 17,902,442 490,000 TBD 192,500 TBD 18,584,942 TBD TBD
Option totals: 52,423,246 1,424,500 570,500 54,418,246
Total values: 90,384,596 2,269,000 570,500 93,409,596
</TABLE>
*Includes available award fee and target incentive fee until such time as earned
fees are entered into the table at which time the contract value includes the
earned fee amounts.
<PAGE> 256
NAS10-98001
Mod #15
Page 14
Table B-12 CONTRACT VALUE & FUNDING
<TABLE>
<CAPTION>
CONTRACT FUNDING
---------------------------------------------------------------------------------
CONTRACT CONTRACT ALL OTHER TOTAL COST ADEQUATE THRU
MOD VALUE ODC COSTS TOTAL COSTS FEE AND FEE DATE
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Basic $16,070,575 $ 500,000 $ 480,769 $ 980,769 $ 19,231 $ 1,000,000 10/22/97
1 -- 250,000 1,024,650 1,274,650 40,986 1,315,636 11/17/97
2 -- 250,000 654,615 904,615 26,185 930,800 12/10/97
3 -- 12,452 1,105,371 1,117,823 36,124 1,153,947 01/03/98
4 -- 726,823 2,133,009 2,859,832 86,903 2,946,735 03/05/98
5 -- 1,610,156 3,872,422 5,482,578 159,632 5,642,210 07/04/98
6 -- 1,671,191 3,847,546 5,518,737 53,137 5,571,874 08/18/98
8 -- 2,660,340 289,012 2,949,352 2,949,352 09/30/98
9 -- -- 5 5 -- 5 09/30/98
10 3,615,320
12 2,026,993 -- 22,198 22,198 -22,198 -- --
14 -- -2,446,751 4,099,097 1,652,346 86,360 1,738,706 10/31/98
15 17,278,482
Totals: $38,991,350 $ 5,234,211 $17,528,694 $22,762,905 $486,360 $23,249,265 10/31/98
</TABLE>
<PAGE> 257
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
16
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO RP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U.S. Small Business Administration
3511 US Hwy 19 North, Suite 310 100 So. Biscayne Blvd. 7th fl.,
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
- --------------------------------------------------------------------------------
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 $2,169,045
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
CONTRACTOR'S COPY DUPLICATE ORIGINAL
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
The purpose of this modification is to increase the funding of the
contract by $2,169,145. This modification also corrects Article B-12,
Mod. No. 6 to read $5,571,875 in lieu of $5,571,874. The total funding
to date is $25,418,311.
These additional funds extend the period of performance through December
9,1998.
As a result of the above change, page 14 of subject contract, as
revised, is deleted and the enclosed page 14 is substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Rene E. Paquette
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ RENE E. PAQUETTE 10-8-98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (Rev.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 258
NAS10-98001
Mod. No. 16
Page 14
Table B-12 CONTRACT VALUE & FUNDING
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------
CONTRACT FUNDING
-----------------------------------------------------------------------------
CONTRACT CONTRACT ALL OTHER TOTAL COST ADEQUATE
MOD VALUE ODC COSTS TOTAL COSTS FEE AND FEE THRU DATE
-----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Basic $16,070,575 $ 500,000 $ 480,769 $ 980,769 $ 19,231 $ 1,000,000 10/22/97
1 250,000 1,024,650 1,274,650 40,986 1,315,636 11/17/97
2 250,000 654,615 904,615 26,185 930,800 12/10/97
3 12,452 1,105,371 1,117,823 36,124 1,153,947 01/03/98
4 726,823 2,133,009 2,859,832 86,903 2,946,735 03/05/98
5 1,610,156 3,872,422 5,482,578 159,632 5,642,210 07/04/98
6 1,671,192 3,847,546 5,518,738 53,137 5,571,875 08/18/98
8 2,660,340 289,012 2,949,352 2,949,352 09/30/98
9 5 5 5 5 09/30/98
10 3,615,320
12 2,026,993 22,198 22,198 -22,198
14 -2,446,751 4,099,097 1,652,346 86,360 1,738,706 10/31/98
15 17,278,462
16 66,564 1,992,643 2,059,207 109,838 2,169,045 12/9/98
Totals: $38,991,350 $ 5,300,776 $19,521,337 $24,822,113 $ 596,198 $25,418,311 12/9/98
</TABLE>
*Added $1 to Mod 6 ODC
<PAGE> 259
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
NAS10-98001
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
17
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C,
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 950524
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor Prime Contractor
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd., 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS, IT MODIFIES THE
CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES SET
FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO. IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE
CHANGES (such as changes in paying office, appropriation date, etc.) SET FORTH
IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
- --------------------------------------------------------------------------------
|X| D. OTHER (Specify type of modification and authority)
Unilateral Modification in accordance with
Atachment J-4 EDC Award Fee Evaluation Plan
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document and
return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
including solicitation/contract subject matter where feasible.)
A. This contract modification reflects the performance rating and earned
award fee for the period October 1, 1997, through September 30, 1998, as
follows:
Rating: Very Good Earned Award Fee: $360,000.00
NOTE: PROVISIONAL AWARD FEE PAYMENTS DISBURSED TO DATE IN THE AMOUNT OF
$337,758.00 ARE HEREBY DEDUCTED FROM THE EARNED AWARD FEE FOR A NET
AMOUNT DUE OF $22,242.00.
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ BOB R. PIRKLE 11-13-98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 260
NAS10-98001
Mod. No. 17
Page 2 of 2
B. The fee determination reflected above is hereby implemented via the
following changes to the contract.
1. Contract Table B-3 is deleted and replaced by Tables B-3.A and B-3.C.
2. The contract value for CY1 is decreased by $40,000.00, from
$21,712,888.00 to $21,672,888.00, to reflect the amount of unearned
award fee.
C: The following page changes are made by this modification:
Remove Pages Replace Pages
------------ -------------
8 8
8.1 8.1
8.2 8.2
- 8.2.1
14 14
<PAGE> 261
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
18
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-1 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 North., Suite 300 100 So. Biscayne Blvd., 7th fl.
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 $3,512,128.00 Increase
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the
contract with an additional $3,512,128.00 as reflected in Table B-12 for
a revised total of $28,930,439. Funding is adequate for contract
performance through January 30,1999.
B. As a result of the above change, page 14 of subject contract, as
revised, is deleted and the enclosed page 14 is substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ BOB R. PIRKLE 11-24-98
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.24
<PAGE> 262
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
19
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-2 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 North, Suite 300 100 So. Biscayne Blvd., 7th fl.
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 $11,056,165.00 INCREASE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the
contract with an additional $11,056,165.00 as reflected in Table B-12
for a revised total of $39,986,604.00. funding is adequate for contract
performance through July 15,1999.
B. As a result of the above change, page 14 of subject contract, as
revised, is deleted and the enclosed page 14 is substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ BOB R. PIRKLE 1-20-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.24
<PAGE> 263
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
20
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-3 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 North, Suite 300 100 So. Biscayne Blvd., 7th fl.
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 $2,801,843.00 INCREASE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the
contract with an additional $2,801,843.00 as reflected in Table B-12
for a revised total of $42,788,447.00. Funding is adequate for contract
performance through August 30,1999.
B. As a result of the above change, page 14 of subject contract, as
revised, is deleted and the enclosed page 14 is substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ BOB R. PIRKLE 3-15-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.24
<PAGE> 264
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
21
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd., 7th floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
NO CHANGE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
- --------------------------------------------------------------------------------
|X| D. OTHER (Specify type of modification and authority)
Exercise of Option pursuant to Contract Article B-5
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
This modification serves to exercise an option for 187,000 additional
labor hours.
SEE PAGE 2
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ BOB R. PIRKLE 4-28-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.24
<PAGE> 265
NAS10-98001
Mod. No.21
Page 2 of 2
1. Pursuant to Contract Article B-5, OPTIONS TO EXTEND THE PERIOD OF
CONTRACT AND OPTIONS FOR INCREMENTAL INCREASE OF EFFORT, the Government
unilaterally increases the maximum number of labor hours that can be
ordered during the period October 1, 1998 through September 30, 1999 by
187,000 (163,550 Direct/23,450 Subcontract). This action increases the
total contract value from $38,951,350 to $45,481,964, an increase of
$6,530,614.
2. Contract Article B-2, EFFORT REQUIRED DURING CONTRACT PERFORMANCE, is
updated to reflect an increase in the maximum order requirements from
350,000 hours to 537,000 hours for the period October 1, 1998 through
September 30, 1999.
3. Contract Article B-5, OPTIONS TO EXTEND THE PERIOD OF CONTRACT AND
OPTIONS FOR INCREMENTAL INCREASE OF EFFORT, is updated to reflect the
total number of hours exercised to date and the optional labor hours
remaining available.
4. Contract Tables B-3.A, CONTRACT VALUE, and B-12, CONTRACT VALUE AND
FUNDING, are updated to reflect the increase to estimated cost of
$6,194,014, and increase the amounts for available award fee and
incentive fee by $237,490, and $99,110, respectively.
5. Contract Table B-3.C, AVAILABLE AND EARNED FEES, is updated to reflect
an increase to available award fee of $237,490, and $99,110, for
incentive fee.
6. The following page changes are made by this modification:
Remove Pages Add/Replace Pages
------------ -----------------
7.1 7.1
8.1 8.1
8.2.1 8.2.1
9 9
14 14
<PAGE> 266
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
- --------------------------------------------------------------------------------
1. CONTRACT ID CODE
- --------------------------------------------------------------------------------
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
22
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-4 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA --------------------------
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA --------------------------
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 North, Suite 300 100 So. Biscayne Blvd., 7th fl.
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
- --------------------------------------------------------------------------------
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 $2,351,977.00 INCREASE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
(x) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the
contract with an additional $2,351,977.00 as reflected in Table B-12
for a revised total of $45,140,424.00. Funding is adequate for contract
performance through September 30, 1999.
B. As a result of the above change, page 14 of subject contract, as
revised, is deleted and the enclosed page 14 is substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /s/ Bob R. Pirkle 5-20-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 267
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
- --------------------------------------------------------------------------------
1. CONTRACT ID CODE
NAS1O-98001
- --------------------------------------------------------------------------------
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
23
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-5 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA --------------------------
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO BP
John F. Kennedy Space Center, NASA --------------------------
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Admin.
35111 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd., 7th floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
- --------------------------------------------------------------------------------
CODE FACILITY CODE
- --------------------------------------------------------------------------------
9A. AMENDMENT OF SOLICITATION NO.
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 MR 991033 S-5 (F) $1,017,500.00 increase
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|_| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
|X| D. OTHER (Specify type of modification and authority)
Exercise of option pursuant to Article B-5
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
The purpose of this modification is to incrementally fund the
contract with an additional $1,017,500.00 and to exercise the option for
19,000 additional labor hours.
SEE PAGE 2
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
Bob R. Pirkle
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /s/ Bob R. Pirkle 7-27-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 268
NAS10-98001
Mod. No. 23
Page 2 of 2
A. This modification incrementally funds the contract with an additional
$1,017,500 as reflected in the Table B-12 for a revised total of $46,157,924.
Funding is adequate for contract performance through September 1999.
B. Pursuant to Contract Article B-5, OPTIONS TO EXTEND THE PERIOD OF CONTRACT
AND OPTIONS FOR INCREMENTAL INCREASE OF EFFORT, the Government unilaterally
increases the maximum number of labor hours that can be ordered during the
period October 1, 1998 through September 30, 1999 by 19,000 (13,000 Direct /
3,000 Subcontract). This action increases the total contract value from
$45,481,964 to $46,157,924, an increase of $675,960.
C. Contract Article B-2, EFFORT REQUIRED DURING CONTRACT PERFORMANCE, is updated
to reflect an increase in the maximum order requirements from 537,000 hours to
556,000 hours for the period October 1, 1998 through September 30, 1999.
D. Contract Article B-5, OPTIONS TO EXTEND THE PERIOD OF CONTRACT AND OPTIONS
FOR INCREMENTAL INCREASE OF EFFORT, is updated to reflect the total number of
hours exercised to date and optional labor hours remaining available.
E. Contract Tables B-3.A, CONTRACT VALUE, and B-12, CONTRACT VALUE AND FUNDING,
are updated to reflect the increase to estimated cost of $641,760, and increase
the amounts of available award fee and incentive fee by $24,130 and $10,070,
respectively.
F. Contract Table B-3.C, AVAILABLE AND EARNED FEES, is updated to reflect an
increase to available award fee of $24,130 and $10,070, for incentive fee.
G. The following page changes are made by this modification:
Remove Pages Replace Pages
------------ -------------
7.1 7.1
8.1 8.1
8.2.1 8.2.1
9 9
14 14
<PAGE> 269
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
- --------------------------------------------------------------------------------
1. CONTRACT ID CODE
NAS10-98001
- --------------------------------------------------------------------------------
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
24
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO TP
John F. Kennedy Space Center, NASA --------------------------
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO TP
John F. Kennedy Space Center, NASA --------------------------
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Co., Inc. U. S. Small Business Admin.
35111 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd., 7th floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
- --------------------------------------------------------------------------------
CODE FACILITY CODE
- --------------------------------------------------------------------------------
9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to add a clause entitled "ARTICLE
G-8, GOVERNMENT FURNISHED PROPERTY" to the contract. Replacement page 27
that contains the new clause is attached to this modification.
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /s/ Timothy W. Pugh 7-30-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 270
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
- --------------------------------------------------------------------------------
1. CONTRACT ID CODE
NAS10-98001
- --------------------------------------------------------------------------------
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
25
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Admin.
35111 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd., 7th floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
- --------------------------------------------------------------------------------
CODE FACILITY CODE
- --------------------------------------------------------------------------------
9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
|X| C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
FAR 52-243-2 CHANGES COST REIMBURSEMENT (AUG 1989) ALTERNATE I (APR
1984) AND MUTUAL AGREEMENT OF THE PARTIES
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor | | is not, |X| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to add a clause entitled "ARTICLE
G-9, KSC 52.239-90 KSC INFORMATION TECHNOLOGY (IT) SECURITY PROGRAM (AUG
1999)" to contract NAS10-98001. Replacement page 27 that contains the
new clause is attached to this modification.
B. The above modification results in no adjustment in contract valued.
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
/s/ [ILLEGIBLE] 8-20-99
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/ Timothy W. Pugh 9-13-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
Contractor's Copy FAR (48 CFR) 53.243
<PAGE> 271
NAS10-98001
Modification 25
Page 27
Government to fulfill them in a timely manner in order to minimize
Contractor procurement.
D. Items generally considered "fixtures" (i.e., become a part of the premises
when installed, such as water coolers, air condititioners partitions...)
shall not be purchased by the Contractor under the authority of this clause.
Additionally, items of a capital nature shall not be purchased under the
authority of this clause without the prior written approval of the
Contracting Officer.
ARTICLE G-8 GOVERNMENT FURNISHED PROPERTY (Incorporated via Modification 24)
The Government property to be furnished under this contract is set forth in
Section J, Attachment J-2 of this contract.
A. Rent-Free Use
1. The Contractor may enter into arrangements with other on-site
contractors to perform certain work in furtherance of KSC objectives. To this
end, the contractor is authorized to use, on a rent-free non-interference basis,
the Government-furnished property and facilities provided under this contract.
This authority may be unilaterally withdrawn by the Government without
adjustment to any other provision of this contract.
ARTICLE G-9 KSC 52.239-90 KSC INFORMATION TECHNOLOGY (IT) SECURITY PROGRAM (AUG
1999) (Incorporated via Modification 25)
KSC Contractors that process NASA data shall comply with NASA's Information
Technology (IT) Security Program. Contractors shall ensure as computers are
reassigned or excessed that computer's hard disks are erased so that sensitive
data and Government-licensed software cannot be recovered.
The Contractor shall comply with the following:
a. NPD 2810.1, Security of Information Technology, available for review at
http://nodis.hq.nasa.gov/Library/Directives/NASA-WIDE/Policies/Legal
Policies/N_PD_2810_1.html
b. NPG 2810, Security of Information Technology, available for review at
http://www.ksc.nasa.gov/nasaonly/cio/nasadocs/npg2810_21may99.pdf
c. KDP-KSC-P-1836, Removing Data and licensed Software from Information
Technology Storage Devices, available for review under Kennedy
Documented Procedures, (AA) at
http://wit.ksc.nasa.gov/BusinessWorld/html/ksc_procedures.html
<PAGE> 272
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
- --------------------------------------------------------------------------------
1. CONTRACT ID CODE NAS10-98001
- --------------------------------------------------------------------------------
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
26
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-6 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Admin.
35111 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd. 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
- --------------------------------------------------------------------------------
CODE FACILITY CODE
- --------------------------------------------------------------------------------
9A. AMENDMENT OF SOLICITATION NO.
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 MR 991003 S-6 $2,200,031.00 Increase
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
FAR 52-243-2 CHANGES COST REIMBURSEMENT (AUG 1989) ALTERNATE I (APR
1984) AND MUTUAL AGREEMENT OF THE PARTIES
- --------------------------------------------------------------------------------
|X| D. OTHER (Specify type of modification and authority)
Contract Provision B-5, Options to Extend the Period of Contract.
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
See Page 2
Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full effect.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Marlo F. Krisberg
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /s/ Marlo F. Krisberg 9-8-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 273
NAS10-98001
Modification 26
Page 2 of 2
A. The purpose of this modification is to exercise the option period commencing
October 1, 1999 through September 30, 2000. The estimated contract value, as
shown on Table B-3.A, for option period 10/01/99 - 9/30/00 in the amount of
$17,699,862 was utilized as the basis for establishing the estimated
contract value for this option period.
B. In addition, this modification incrementally funds this contract with an
additional $2,200,031.00. Table B-12 has been updated to reflect the
allotment of this addition incremental funding.
C. As a result of these changes, Tables B-3.A and B-12 (pages 8.1 and 14) of
the subject contract, as revised, are hereby deleted in their entirety and
the enclosed Tables B-3.A and B-12 (pages 8.1 and 14) are substituted in
lieu thereof.
<PAGE> 274
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
27
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 N. Suite 300 100 S. Biscayne Blvd. 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
[X] B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
FAR 52-243-2 CHANGES COST REIMBURSEMENT (AUG 1989) ALTERNATE I (APR
1984) AND MUTUAL AGREEMENT OF THE PARTIES
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
See Page 2
Except as provided herein, all terms and conditions of the document
referenced in Item 9A or 10A, as heretofore changed, remains unchanged and in
full effect.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /s/Timothy W. Pugh 9-9-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 275
NAS10-98001
Modification 27
Page 2 of 2
A. The purpose of this modification is to delete / revise the following Data
Requirements List Documents (DRD):
- ---------------------------------------------------------------------------
DRD # TITLE REV. STATUS
- ---------------------------------------------------------------------------
DRD-002 Metrics Data Report Revised
- ---------------------------------------------------------------------------
DRD-003 NF 533 Revised
- ---------------------------------------------------------------------------
DRD-015 Project Status Report Revised
- ---------------------------------------------------------------------------
DRD-017 Maintenance Status Report Deleted
- ---------------------------------------------------------------------------
DRD-018 Task Order Summary Report Deleted
- ---------------------------------------------------------------------------
DRD-023 Summary Labor Report Deleted
- ---------------------------------------------------------------------------
DRD-024 Task Order Revision Status Report Deleted
- ---------------------------------------------------------------------------
DRD-027 Task Order Procurement Status Revised
Report
- ---------------------------------------------------------------------------
DRD-028 Contractor Workforce and Funding Deleted
Authority Summary Report
- ---------------------------------------------------------------------------
DRD-029 Contractor Resource Management Deleted
Summary and Concerns Report
- ---------------------------------------------------------------------------
DRD-030 Work Plans (Task Order Plans) Revised
- ---------------------------------------------------------------------------
Attachment 1 to this modification provides Section J, Attachment J-1,
Appendix 1, Data Requirements List replacement pages that reflect the
revisions to the DRDs indicated above.
B. In addition, the Section J, Attachment J-3, Wage Determination is hereby
deleted and replaced with Wage Determination No. 94-2118, Revision No. 12,
Dated 05/28/99 which is provided herein as Attachment 2 to this
modification.
C. In order to reflect the exercise of option for the period of 10/1/99 -
9/30/00 accomplished via Modification #26, the first sentence in Section F,
Article F-2 is changed to read as follows: "The period of performance of
this contract, through the exercise of option 2, is October 1,1997 through
September 30, 2000". Replacement page 21 that reflects this new language is
provided herein as Attachment 3.
<PAGE> 276
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
28
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U.S. Small Business Administration
35111 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd., 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
|X| C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
FAR 52-243-2 CHANGES COST REIMBURSEMENT (AUG 1989) ALTERNATE I (APR
1984) AND MUTUAL AGREEMENT OF THE PARTIES
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
See Page 2
Except as provided herein, all terms and conditions of the document
referenced in Item 9A or 10A, as heretofore changed, remains unchanged and in
full effect.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
Larry Tuttle, Business Manager
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
/s/Larry Tuttle 9/22/99
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /s/Timothy W. Pugh 9-22-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 277
NAS10-98001
Modification 28
Page 2 of 2
A. The purpose of this modification is to normalize the maximum labor hours
identified in the contract for each optional contract period to reflect
productive labor, inclusive of subcontractor labor hours and overtime, only.
The conversion is necessary to relate the Task Order productive effort to
contract value productive authority for incentive fee evaluation purposes.
The results of this normalization of hours are reflected in the attached
revised contract page 7.1.
B. The estimated cost for the option periods as depicted on page 8.2.1, Table
B-3.A remain unchanged by this modification. However, the direct labor rate
as depicted on page 9.1, Table B-5.B require adjustment for proper
calculation of estimated cost of incremental increase of effort during the
option periods. The results of these rate adjustments are reflected on the
attached revised page 9.1, Table B-5.B.
C. The available award fee and target incentive fee amounts as depicted on page
8.2.1, Table B-3.C remain unchanged by this modification. However, the
available award fee and target incentive fee rates are hereby changed to
reflect the impact of the revised base of productive hours for proper
calculation of available fee for incremental increases of effort during the
option periods. The results of these adjustments are reflected on the
attached revised page 9.1, Table B-5.B.
<PAGE> 278
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
29
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-7
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 N. Suite 300 100 S. Biscayne Blvd. 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
10A. MODIFICATION OF CONTRACT/ORDER NO.
|X| NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 $2,750,355.00 INCREASE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the
contract with an additional $2,750,355.00 as reflected in Table B-12 for
a revised total of $51,108,310.00. Funding is adequate for contract
performance through December 01, 1999.
B. As a result of the above change, page 14 of subject contract, as
revised is deleted and the enclosed page 1 is substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 9-24-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 279
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
30
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-8 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 N. Suite 300 100 S. Biscayne Blvd. 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
|X| 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/34/99 $330,000.00 INCREASE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the
contract with an additional $330,000.00 as reflected in Table B-12 for a
revised total of $51,438,310.00. Funding is adequate for contract
performance through December 15, 1999.
B. As a result of the above change, page 14 of subject contract, as
revised, is deleted and the enclosed page 14 is substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 9-30-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 280
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
31
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 001003 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO BP
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 N. Suite 300 100 S. Biscayne Blvd. 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
|X| 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/52/00 $2,239,277.00 INCREASE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the
contract with an additional $2,239,277.00 as reflected in Table B-12 for
a revised total of $53,677,587.00. Funding is adequate for contract
performance through January 25, 2000.
B. As a result of the above change, page 14 of subject contract, as
revised, is deleted and the enclosed page 14 is substituted in lieu
thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 10-20-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 281
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
32
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 991003 S-8 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 5) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 N. Suite 300 100 S. Biscayne Blvd. 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
|X| 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended. |_| Is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
FAR 52-243-2 CHANGES COST REIMBURSEMENT (AUG 1989) ALTERNATE I (APR
1984) AND MUTUAL AGREEMENT OF THE PARTIES
- --------------------------------------------------------------------------------
X D. OTHER (Specify type of modification and authority) Unilateral
Modification in accordance with J-4 EDC Award Fee Evaluation Plan.
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. This contract modification reflects the performance rating, earned
interest fee, and earned incentive fee for the period October 1, 1998, through
September 30, 1999 as follows:
Rating:95 Earned Award Fee: $674,000 Earned Incentive Fee: $358,600
Total Earned Award / Incentive Fee: $1,032,600
Note: Provisional award fee payments disbursed during this performance period in
the amount of $545,592 are hereby deducted from the earned award / Incentive fee
for a NET AMOUNT DUE OF $487,008.00
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 11-17-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV.
PREVIOUS EDITION UNUSABLE 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 282
NAS10-98001
Modification No. 32
Page 2 of 2
B. The fee determination reflected above is hereby implemented via the
following changes to the contract:
1. Contract Tables B-3.A, B-3.C, and B-12 are revised to reflect the value
of the earned award/ incentive fee for this period.
2. The contract value for CY2 is adjusted by $31,800, from $24,485,036 to
$24,516,836, to reflect the amount of earned award / incentive fee.
C. The following page changes are made by this modification:
Remove Pages Replace Pages
------------ -------------
8.1 8.1
8.2.1 8.2.1
14 14
In accordance with Contract Article B-3, Contract Value, paragraph E., Earned
Incentive Fee (EIF), the actual cost was derived from the Contractor's September
533 Report for the calculation of EIF. In addition, the EIF depicted on this
modification is considered final and not subject to later adjustment based upon
cost disallowance, final indirect rates or accounting adjustments.
<PAGE> 283
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
33
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 001003 S-1 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 North, Suite 300 100 So. Biscayne Blvd., 7th fl.
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
(x) 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
|X| 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/52/00 $9,755,565.00 INCREASE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the contract with
an additional $9,755,565.00 as reflected in Table B-12 for a revised total of
$63,433,152.00. Funding is adequate for contract performance through May 12,
2000, per Dynacs e-mail dated 12/07/99.
B. As a result of the above change, page 14 of subject contract, as revised, is
deleted and the enclosed page 1[ILLEGIBLE] is substituted in lieu thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 12-13-99
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 284
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE NAS10-98001
PAGE OF PAGES
1 2
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
34
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor Prime Contractor
------------- ----------------
Dynacs Engineering Co., Inc. U. S. Small Business Admin.
35111 US Hwy 19 N., Suite 300 100 S. Biscayne Blvd., 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
10/1/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (c) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
X C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
FAR 52.243-2 CHANGES COST REIMBURSEMENT (AUG 1989) ALTERNATE I (APR
1984) AND MUTUAL AGREEMENT OF THE PARTIES
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
See Page 2
Except as provided herein, all terms and conditions of the document referenced
in Item 9A or 10A, as heretofore changed, remains unchanged and in full effect.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
Larry J. Tuttle, Business Manager
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
/S/LARRY J. TUTTLE 2/22/00
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 2/22/00
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 285
NAS 10-98001
Modification 34
Page 2 of 2
It has been recognized that NASA may require the Contractor to perform design,
contract surveillance, construction, and modification of facilities functions.
It is anticipated that these construction of facilities efforts will be
incidental to the associated research and development activities required under
the Contract. The purpose of this modification is to add this additional scope
to the statement of work and to incorporate the associated contract clauses as
follows:
A. ARTICLE B-12 NFS 1582.232-81 CONTRACT FUNDING (JUN 1990) is revised to apply
the provisions of the "Limitations of Funds" Clause separately to each
construction of facilities effort. A full text version of the revised
contract clause is reflected on the attached revised page 13. In addition, a
new Contract Table B-12 A Facilities Projects: Values and Funding, which
delineates the level of funding provided by NASA for the accomplishment of
each construction effort, is attached as a new contract page 14 A.
B. Contract Section I, ARTICLE I-1, FAR 52.252-2 CLAUSES INCORPORATED BY
REFERENCE (JUN 1988) has been updated to incorporate the FAR Construction
Clauses. The attached replacement / new contract pages 38, 38 A, 38 B, and
39, define these additional clauses.
C. The scope of work as defined in Contract Attachment J-1, Statement of Work,
has been revised to include services for the design, contract surveillance,
construction and modification to facilities. Statement of Work replacement
pages 49, 50, and 51 are attached hereto.
<PAGE> 286
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
35
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 001003 S-2 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 North, Suite 300 100 So. Biscayne Blvd. 7th fl.
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
|X| 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
CW-1/2590C/40-00-00/52/00 MR 001003 S-2 $8,742,217.00 INCREASE
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
X B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document
and return 4 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
A. The purpose of this modification is to incrementally fund the contract with
an additional $8,742,217.00 as reflected in Table B-12 for a revised total of
$72,175,369.00. Funding is adequate for contract performance through September
30, 2000, per Dynacs e-mail dated February 16, 2000.
B. As a result of the above change, page 14 of subject contract, as revised, is
deleted and the enclosed page 1 [ILLEGIBLE] is substituted in lieu thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 2/16/00
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 287
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
1. CONTRACT ID CODE
PAGE OF PAGES
1 1
- --------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO.
36
- --------------------------------------------------------------------------------
3. EFFECTIVE DATE
See Block 16C
- --------------------------------------------------------------------------------
4. REQUISITION/PURCHASE REQ. NO.
MR 001003 S-2 (F)
- --------------------------------------------------------------------------------
5. PROJECT NO. (If applicable)
- --------------------------------------------------------------------------------
6. ISSUED BY CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
7. ADMINISTERED BY (If other than Item 6) CODE OP-OSO
John F. Kennedy Space Center, NASA
Procurement Office
Kennedy Space Center, FL 32899
- --------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State, and Zip Code)
Subcontractor: Prime Contractor:
Dynacs Engineering Company, Inc. U. S. Small Business Administration
35111 US Hwy 19 North, Suite 300 100 So. Biscayne Blvd. 7th Floor
Palm Harbor, FL 34684 Miami, FL 33131
Subcontract Number: 0455-97-706158
CODE FACILITY CODE
- --------------------------------------------------------------------------------
|X| 9A. AMENDMENT OF SOLICITATION NO.
- --------------------------------------------------------------------------------
9B. DATED (SEE ITEM 11)
- --------------------------------------------------------------------------------
X 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS10-98001
- --------------------------------------------------------------------------------
10B. DATED (SEE ITEM 13)
9/22/97
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- --------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in item 14. The hour
and date specified for receipt of Offers |_| is extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date
specified in the solicitation or as amended, by one of the following methods:
(a) By completing Items 8 and 15, and returning __ copies of the amendment; (b)
By acknowledging receipt of this amendment on each copy of the offer submitted;
or (C) By separate letter or telegram which includes a reference to the
solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGEMENT TO BE
RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND
DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this
amendment you desire to change an offer already submitted, such change may be
made by telegram or letter, provided each telegram or letter makes reference to
the solicitation and this amendment, and is received prior to the opening hour
and date specified.
- --------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (If required)
- --------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- --------------------------------------------------------------------------------
A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER NO.
IN ITEM 10A.
- --------------------------------------------------------------------------------
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office,
appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE
AUTHORITY OF FAR 43.103(b).
- --------------------------------------------------------------------------------
X C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF
FAR 52.243-2 CHANGES COST REIMBURSEMENT (AUG 1989) ALTERNATE I (APR
1984) AND MUTUAL AGREEMENT OF THE PARTIES
- --------------------------------------------------------------------------------
D. OTHER (Specify type of modification and authority)
- --------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document
and return 3 copies to the issuing office.
- --------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section
headings, including solicitation/contract subject matter where
feasible.)
The purpose of this modification is to allow rent-free use of the NASA - GSA
vehicles identified in the enclosed change to Contract Attachment J-2. As a
result of this change, page 118 of subject contract, as revised, is deleted and
the enclosed page 118 is substituted in lieu thereof.
- --------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print)
Larry T. Tuttle, Business Manager
- --------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED
/S/LARRY T. TUTTLE, 2/22/00
---------------------------------------
(Signature of person authorized to sign)
- --------------------------------------------------------------------------------
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Timothy W. Pugh
Contracting Officer
- --------------------------------------------------------------------------------
16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /S/TIMOTHY W. PUGH 3/7/00
------------------------
(Signature of Contracting Officer)
- --------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30
PREVIOUS EDITION UNUSABLE (REV. 10-83)
Prescribed by GSA
CONTRACTOR'S COPY FAR (48 CFR) 53.243
<PAGE> 1
Exhibit 10.4
<TABLE>
<S> <C>
====================================================================================================================================
SOLICITATION, OFFER AND AWARD 1. THIS CONTRACT IS A RATED ORDER > RATING PAGE
UNDER DPAS (15 CFR 350) 1 OF 153
====================================================================================================================================
2. CONTRACT NO. 3. SOLICITATION NO. 4. TYPE OF SOLICITATION 5. DATE ISSUED 6. REQUISITION/PURCHASE NO.
NAS3-98008 RFP 3-085970 |_| SEALED BID (IFB) 9-30-97 085970
|X| NEGOTIATED (RFP)
- ------------------------------------------------------------------------------------------------------------------------------------
7. ISSUED BY CODE 0616/TAS 8. ADDRESS OFFER TO (If other than Item 7)
NASA Lewis Research center ------------------
Attn: Thomas A. Spicer, Services and Construction Branch
21000 Brookpark Road, Mail Stop 500-312
Cleveland, OH 44135-3191
- ------------------------------------------------------------------------------------------------------------------------------------
NOTE: In sealed bid solicitations "offer" and "offeror" mean "bid" and "bidder"
- ------------------------------------------------------------------------------------------------------------------------------------
SOLICITATION
- ------------------------------------------------------------------------------------------------------------------------------------
9. Sealed offers in original and 10 copies for furnishing the supplies or services in the Schedule will be received at the place
specified in Item 8, or if handcarried, in the depository located in D.E.B. Building, Room 1301 until 4:30 P.M. local time, on
10-30-1997 (date).
CAUTION - LATE Submissions, Modifications, and Withdrawals: See Section L. Provision No. 52.214-7 or 52.214-10. All offers are
subject to all terms and conditions contained in this solicitation.
- ------------------------------------------------------------------------------------------------------------------------------------
10. FOR INFORMATION > A. NAME B. TELEPHONE NO. (Include area code) (NO COLLECT CALLS)
CALL: Thomas A. Spicer (216) 433-2762
- ------------------------------------------------------------------------------------------------------------------------------------
11. TABLE OF CONTENTS
- ------------------------------------------------------------------------------------------------------------------------------------
(X) SEC. DESCRIPTION PAGE(S) (X) SEC. DESCRIPTION PAGE(S)
- ------------------------------------------------------------------------------------------------------------------------------------
PART I - THE SCHEDULE PART II - CONTRACT CLAUSES
- ------------------------------------------------------------------------------------------------------------------------------------
|X| A SOLICITATION/CONTRACT FORM 1 |X| I CONTRACT CLAUSES 40
- ------------------------------------------------------------------------------------------------------------------------------------
|X| B SUPPLIES OR SERVICES AND PRICES/COSTS 4 PART III - LIST OF DOCUMENTS, EXHIBITS AND OTHER ATTACH.
- ------------------------------------------------------------------------------------------------------------------------------------
|X| C DESCRIPTION/SPECS/WORK STATEMENT 7 |X| J LIST OF ATTACHMENTS 61
- ------------------------------------------------------------------------------------------------------------------------------------
|X| D PACKAGING AND MARKING 1 PART IV - REPRESENTATIONS AND INSTRUCTIONS
- ------------------------------------------------------------------------------------------------------------------------------------
|X| E INSPECTION AND ACCEPTANCE 1 |X| K REPRESENTATIONS, CERTIFICATIONS AND
- ------------------------------------------------------------------------------------------------------------------------------------
|X| F DELIVERIES OR PERFORMANCE 4 OTHER STATEMENTS OF OFFERORS
- ------------------------------------------------------------------------------------------------------------------------------------
|X| G CONTRACT ADMINISTRATION DATA 18 |X| L INSTRS., CONDS., AND NOTICES TO OFFERORS
- ------------------------------------------------------------------------------------------------------------------------------------
|X| H SPECIAL CONTRACT REQUIREMENTS 16 |X| M. EVALUATION FACTORS FOR AWARD
- ------------------------------------------------------------------------------------------------------------------------------------
OFFER (Must be fully completed by offeror)
- ------------------------------------------------------------------------------------------------------------------------------------
NOTE: Item 12 does not apply if the solicitation includes the provisions at 52.214-16, Minimum Bid Acceptance Period.
- ------------------------------------------------------------------------------------------------------------------------------------
12. In compliance with the above, the undersigned agrees, if this offer is accepted within ____ calendar days (60 calendar days
unless a different period in inserted by the offeror) from the date for receipt of offers specified above, to furnish any or all
items upon which prices are offered at the price set opposite each item, delivered at the designated point(s), within the time
specified in the schedule.
- ------------------------------------------------------------------------------------------------------------------------------------
13. DISCOUNT FOR PROMPT PAYMENT > 10 CALENDAR DAYS 20 CALENDAR DAYS 30 CALENDAR DAYS CALENDAR DAYS
See Section I, clause No. 52-232-8) % % % %
- ------------------------------------------------------------------------------------------------------------------------------------
14. ACKNOWLEDGEMENT OF AMENDMENTS (The offeror AMENDMENT NO DATE AMENDMENT NO DATE
acknowledges receipt of amendments to the SOLICITATION -------------------------------------------------------------------
For offerors and related documents numbered and dated: -------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
15. NAME AND CODE FACILITY 16. NAME AND TITLE OF PERSON AUTHORIZED TO SIGN
ADDRESS OF ----------------- ------------------ OFFER (type or print)
OFFEROR
- ------------------------------------------------------------------------------------------------------------------------------------
15B. TELEPHONE NO. 15C. CHECK IF REMITTANCE ADDRESS 17. SIGNATURE 18. OFFER DATE
(Include area code) IS DIFFERENT FROM ABOVE - ENTER
|_| SUCH ADDRESS IN SCHEDULE
- ------------------------------------------------------------------------------------------------------------------------------------
AWARD (To be completed by Government)
- ------------------------------------------------------------------------------------------------------------------------------------
19. ACCEPTED AS TO ITEMS NUMBERED 20. AMOUNT 21. ACCOUNTING AND APPROPRIATION
See Clause B-2
- ------------------------------------------------------------------------------------------------------------------------------------
22. AUTHORITY FOR USING OTHER THAN FULL AND OPEN COMPETITION 23. SUBMIT INVOICES TO ADDRESS SHOW IN: > ITEM
|_| 10 U.S.C. 22304(c) ( ) |_| 41 U.S.C. 253(c) ( ) (4 copies unless otherwise specified)
- ------------------------------------------------------------------------------------------------------------------------------------
24. ADMINISTERED BY (if other than Item 7) CODE 25. PAYMENT WILL BE MADE BY CODE
See Signature Page A-2 ----------- NASA Lewis Research Center ---------------------
Commercial Accounts MS 500-303
2100 Brookpark Road
Cleveland, OH 44135-3191
- ------------------------------------------------------------------------------------------------------------------------------------
26. NAME OF CONTRACTING OFFICER (Type or print) 27. UNITED STATES OF AMERICA 28. AWARD DATE
(Signature of Contracting Officer)
- ------------------------------------------------------------------------------------------------------------------------------------
IMPORTANT - Award will be made on this Form, or on Standard Form 26, or by other authorized official written notice
====================================================================================================================================
</TABLE>
<PAGE> 2
Prime Contract Number: NAS3-98008
Subcontract Number: 98-800590
SIGNATURE PAGE
SUBCONTRACTOR: Dynacs Engineering Co., Inc
28870 U.S. Hwy.
19 N. Ste. 405
Clearwater, FL 34621
Name: [ILLEGIBLE]
Title: [ILLEGIBLE]
Signature: /s/ [ILLEGIBLE] Date: Dec. [ILLEGIBLE]
PRIME CONTRACTOR: U.S. Small Business Administration
Miami District Office
1320 South Dixie Highway, Third Floor
Coral Cable, FL 33148
Name: G. REY-MORAN
Contracting Officer
Signature: /s/ G. Rey-Moran Date: 12/20/97
PROCURING AGENCY: NASA Lewis Research Center
Services & Construction Branch, MS 500-312
21000 Brookpark Road
Cleveland, OH 44135
Name: Thomas A. Spicer
Contracting Officer
Signature: /s/ Thomas A. Spicer Date: 12/17/97
A - 2
<PAGE> 3
RFP3-085970 Section B
PART I - THE SCHEDULE
SECTION B
SUPPLIES OR SERVICES AND PRICE/COSTS
------------------------------------
B.1 LISTING OF CLAUSES INCORPORATED BY REFERENCE
NOTICE: The following solicitation provision and/or contract clauses
pertinent to this section are hereby incorporated by reference:
I. FEDERAL ACQUISITION REGULATION (48 CFR CHAPTER 1)
<TABLE>
<CAPTION>
CLAUSE
NUMBER DATE TITLE
------ ---- -----
<S> <C> <C>
No FAR by reference clauses in Section B.
</TABLE>
II. NASA FEDERAL ACQUISITION REGULATION SUPPLEMENT (48 CFR CHAPTER 18)
<TABLE>
<CAPTION>
CLAUSE
NUMBER DATE TITLE
------ ---- -----
<S> <C> <C>
No FAR by reference clause in Section 8.
</TABLE>
(End of Clause)
B.2 GENERAL
Pursuant to the Federal Acquisition Regulation (FAR) Parts 16.501-2 and
16.504, this contract is defined as an indefinite quantity type. The contract
provides for an indefinite quantity, within stated limits, of supplies or
services to be furnished during a fixed period, with deliveries or performance
to be scheduled by placing orders with the Contractor. The total minimum and
maximum dollar value of supplies or services to be acquired under the contract
are set forth below:
Contract Minimum: The Government will issue Task Order(s) under this contract
which provide for a minimum of $6,000,000 for the 27 months of performance.
Page B - 1
Supplies or Services and Price/Costs 12/17/97
<PAGE> 4
RFP3-085970 Section B
Contract Maximum: The Government issued Task Order(s) under this contract shall
not exceed a maximum of $43,760,345 (Cost=$42,185,846; Fee/Profit=1,574,500) for
the 27 months of performance.
Task Order(s) will be issued on either a firm fixed price (PFP) basis or
on a cost reimbursable (CR) basis.
Ten percent of the technical hours (86,940 hours) have the potential of
being worked under fixed priced task orders. The profit will be $2.34/technical
hour agreed to at task acceptance. The maximum total fixed fee for 27 months is
$203,161.
Ninety percent of the technical hours (782,460 hours) have the potential
of being worked under cost plus award fee task orders.
The award fee periods, award fee per technical hour, and the maximum award
fee pool is as follows:
<TABLE>
<CAPTION>
Period Fee Per Tech. Hour Maximum AF Pool
------ ------------------ ---------------
<S> <C> <C> <C>
1 JAN 1-JUN 30, 1998 $1.71 $446,002
2 JUL 1-DEC 31, 1998 $1.70 $332,546
3 JAN 1-JUN 30, 1999 $1.80 $234,738
4 JUL 1,99-MAR 1,00 $1.83 $357,975
</TABLE>
(a) FIRM FIXED PRICE TASK ORDERS
Firm fixed price task orders will be issued for work that can be well
defined and for which a fair and reasonable price can be obtained. The price is
not subject to any adjustment on the basis of contract cost experience.
(b) COST-REIMBURSEMENT TASK ORDERS
Work performed by the Contractor will be reimbursed based upon allowable
costs incurred, subject to negotiated limitations.
(c) AWARD FEE
Based upon the Contractor's overall performance, an award fee may be
provided to the Contractor. The amount of fee will be determined by the
Government. The award fee pool will be divided into two parts. The first part
will consider the contract administration and cost control. The second part will
consider task order performance.
(End of Clause)
Page B - 2
Supplies or Services and Price/Costs 12/17/97
<PAGE> 5
<TABLE>
<S> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT 1. CONTRACT ID CODE PAGE OF PAGES
NAS3-98008 1 407
- ------------------------------------------------------------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO. 3. EFFECTIVE DATE 4. REQUISITION/PURCHASE REQ.NO. 5. PROJECT NO. (if applicable)
Modification Number Three (03) 7/23/99 NONE SETAR II
- ------------------------------------------------------------------------------------------------------------------------------------
6. ISSUED BY CODE 7830/Lupson 7. ADMINISTERED BY (IF OTHER THAN ITEM 6) CODE
------------ ------------
NASA Glenn Research Center
Services & Construction Branch (M.S. 500-312)
21000 Brookpark Road
Cleveland, OH 44135-3191
- ------------------------------------------------------------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State and Zip Code) |X| 9A. AMENDMENT OF SOLICITATION NO.
Dynacs Engineering Company Inc. ---------------------------------------------
2001 Aerospace Parkway 9B. DATED (SEE ITEM 11)
Brookpark, Ohio 44142
---------------------------------------------
10A. MODIFICATION OF CONTRACT/ORDER NO.
---------------------------------------------
|X| 10B. DATED (SEE ITEM 13)
CODE FACILITY CODE 12/17/97
- ------------------------------------------------------------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- ------------------------------------------------------------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour and date specified for receipt of Offers |_| is
extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date specified in the solicitation or as amended, by one of
the following methods:
(a) By completing Items 8 and 15, and returning ___ copies of the amendment; (b) By acknowledging receipt of this amendment on each
copy of the offer submitted; or (c) By separate letter or telegram which includes a reference to the solicitation and amendment
numbers. FAILURE OF YOUR ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND DATE
SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this amendment you desire to change an offer already submitted,
such change may be made by telegram or letter, provided each telegram or letter makes reference to the solicitation and this
amendment, and is received prior to the opening hour and date specified.
- ------------------------------------------------------------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (if required)
N/A
- ------------------------------------------------------------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- ------------------------------------------------------------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE
CONTRACT ORDER NO. IN ITEM 10A.
- ------------------------------------------------------------------------------------------------------------------------------------
|_| B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (such as changes in paying
office, appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR 43.103(b).
- ------------------------------------------------------------------------------------------------------------------------------------
|X| C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- ------------------------------------------------------------------------------------------------------------------------------------
|_| D. OTHER (Specify type of modification and authority)
- ------------------------------------------------------------------------------------------------------------------------------------
E. IMPORTANT: Contractor is not required to sign this document and return __ copies to the issuing office.
- ------------------------------------------------------------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings, including solicitation/contract subject matter
where feasible.)
(SEE ATTACHED PAGES)
- ------------------------------------------------------------------------------------------------------------------------------------
Except as provided herein, all terms and conditions of the document referenced in Item 9A or 10A, as heretofore changed, remains
unchanged and in full force and effect.
- ------------------------------------------------------------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print) 16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
/s/ Thomas A. Spicer Thomas A. Spicer / Contracting Officer
- ------------------------------------------------------------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED 16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
Vice President &
Program Manager 7/7/99
BY BY /s/ [ILLEGIBLE]
---------------------------------------- ---------------------------------------
(Signature of person authorized to sign) (Signature of Contracting Officer)
- ------------------------------------------------------------------------------------------------------------------------------------
NSN 7540-01-152-807030-105 STANDARD FORM 30 (REV. 10-83)
PREVIOUS EDITION UNUSABLE Prescribed by GSA
FAR (48 CFR) 53.243
</TABLE>
<PAGE> 6
RFP3-085970 Section B
SECTION B / REVISED
Contract Maximum: The Government issued Task Order(s) under this contract shall
not exceed a maximum of $66,797,004 (Cost=564,795,583; Fee/Profit=$2,O0l,421)
for the 27 months of performance.
Task Order(s) shall be issued on either a Firm Fixed Price (FEP) basis or on a
Cost Reimbursable (CR) basis.
Ten percent of the technical hours (111,065 hours) have the potential of being
worked under fixed priced task order(s). The profit will be $2.34/technical hour
agreed to at task acceptance. The maximum total fixed fee for 27 months is
$259,892.
Ninety percent of the technical hours (999,582 hours) have the potential of
being worked Under cost plus award fee task order(s).
The Award Fee periods, award fee per technical hour, and the maximum award fee
pool is as follows:
<TABLE>
<CAPTION>
Period Fee Per Tech. Hour Maximum Award Fee Pool
------ ------------------ ----------------------
<S> <C> <C> <C>
1 Jun 1/98-Feb 28/99
2 Mar 1/99-Aug 3 1/99 * *
3 Sep 1/99-Feb 28/00
4 Mar 1/00-Aug 31/00
TOTAL
</TABLE>
(a) FIRM FIXED PRICE TASK ORDERS
Firm Fixed Price task order(s) shall be issued for work that can be well defined
and for which a fair and reasonable price can be obtained. The price is not
subject to any adjustment on the basis of contract cost experience.
(b) COST - REIMBURSEMENT TASK ORDERS
Work performed by the contractor shall be reimbursed based upon allowable costs
incurred, subject to negotiated limitations.
(c) AWARD FEE
Based upon the Contractor's overall performance, an award fee may be provided to
the Contractor. The amount of fee will be determined by the Government. The
award fee pool will be divided into two parts. The first part will consider the
contract administration and cost control. The second part will consider task
order performance.
(End Of Clause)
*Confidential information has been omitted and filed separately with the
Commission
Page B-2 / Revised
<PAGE> 7
RFP3-085970 Section B
B.3 CONTRACT FUNDING (NOV 1996)
Funds will be obligated against this contract by a separate document, "Order for
Supplies of Services" (Form 347), as Task Orders are placed. Each Form 347 will
specify the Accounting and Appropriation data, and the NASA division to be
supported. Clause 52.232-22, entitled 'Limitation of Funds" will apply to the
total amount of funding available on the contract for the purposes of the
"notification" requirement. However, each Task Order will have a funding limit
to which the "Limitation of Funds" clause applies.
(End of Clause)
B.4 AWARD FEE POOL (SEPT 1997)
(a) The Contractor can earn award fee from zero dollars to the maximum
TBD.
(b) Beginning 6 months after the effective date of this contract, the
Government shall evaluate the Contractor's performance every 6 months (with the
exception of the last period, which will be 9 months) to determine the amount of
fee earned by the Contractor during the period. The Contractor may submit a
self-evaluation of performance for each evaluation period under consideration.
These self-evaluations will be considered by the Government in its evaluation.
The Government's Fee Determination Official (FDO) will determine the fee amounts
based on the Contractor's performance in accordance with the performance
evaluation plan. The plan may be revised unilaterally by the Government prior to
the beginning of any rating period to redirect emphasis.
(c) The Government will advise the Contractor in writing of the evaluation
results. The NASA LeRC Financial Management Division will make payment based
upon issuance of unilateral modification by the Contracting Officer.
(d) The amount of award fee which can be awarded in each evaluation period
is limited to the amount of TBD. Award fee which is not earned in an evaluation
period will not be reallocated to future evaluation periods. If Government
directed descoping occurs, the amount of fee available will unilaterally be
reduced as a direct correlation to the percentage of descoped work.
(e) (1) Pending a determination of the amount of fee earned for an
evaluation period, a portion of the availability fee for that period will be
paid to the Contractor on a not more often than monthly basis. The portion paid
will be 50 percent
Page B - 3
Supplies or Services and Price/Costs 12/17/97
<PAGE> 8
RFP3-085970 Section B
of the current period's available amount; provided, however, that when the
Contracting Officer determines that the Contractor will not achieve a level of
performance commensurate with the provisional rate, a payment of provisional fee
will be discontinued or reduced in such amounts as the Contracting Officer deems
appropriate. The Contracting Officer shall notify the Contractor in writing if
it is determined that such discontinuance or reduction is appropriate. The
determination is not subject to the Disputes Clause.
(2) In the event the amount of fee earned, as determined by the FDO,
is less than the sum of provisional payments made for that period, the
Contractor will either credit the next payment voucher for the amount of
overpayment or refund the difference to the Government, as directed by the
Contracting Officer.
(f) After 85 percent of the potential fee has been paid, the Contracting
Officer may direct the withholding of further payment of fee until a reserve is
set aside in an amount that the Contracting Officer considers necessary to
protect the Government's interest. This reserve shall not exceed 15 percent of
the total potential fee.
(End of Clause)
B.5 SUPPLIES AND/OR SERVICES TO BE FURNISHED (NASA 18-52.210-72) (SEPT 1990)
The Contractor shall provide all resources (except as may be expressly stated in
this contract as furnished by the Government) necessary to furnish the items in
accordance with the Statement of Work (SOW) in Section C.
(End of Clause)
(END OF SECTION)
Page B - 4
Supplies or Services and Price/Costs 12/17/97
<PAGE> 9
RFP3-085970 Section C
SECTION C - DESCRIPTION/SPECIFICATION
/WORK STATEMENT
-------------------------------------
STATEMENT OF WORK
FOR
SCIENTIFIC, ENGINEERING, TECHNICAL, ADMINISTRATIVE
AND RELATED TASKS
C.1 PURPOSE
This Statement of Work defines the requirements for performance-based technical
tasks to assist the NASA Lewis Research Center (LeRC) in meeting the objectives
of its research and development activities. These requirements include, but are
not limited to, technical tasks in the areas of aeronautics, microgravity
sciences, space power and propulsion and related science and technology.
C.2 SCOPE
The Contractor shall perform engineering, scientific, technical, administrative,
and related tasks, issued hereunder by the Contracting Officer, or his
authorized representative. These activities fall into broad categories as
outlined below, but need not be limited to the activities noted. Individual task
order requirements may involve any or all categories of activities. All tasks
issued under this contract shall be performance-based tasks.
In addition, within the scope of this Statement of Work, these performance-based
tasks will require either:
(1) application of the specialized skills of a single individual;
(2) a well-defined, multi-disciplined effort;
(3) or a well-defined, multi-disciplined effort with tasks which require
close integration with tasks performed by NASA personnel to
comprehensively address all facets of a complex research or flight
program.
For each task the Contractor will also be responsible for estimating costs,
establishing budgets, developing a major milestone schedule, monitoring actual
progress against
Page C -1
Description/Specification/ Work Statement 12/17/97
<PAGE> 10
RFP3-085970 Section C
plan, identifying problems, and taking appropriate corrective action. These
responsibilities are in addition to the actual execution of the technical
requirements.
Tasks will encompass the broad scope of mission responsibilities at the LeRC,
and include: research and technology, engineering design and development
operations and administration/management.
C.2.1 Research and Technology
Develop and apply mathematical and theoretical analyses in engineering and
science disciplines. Perform analytical and experimental investigations of
concepts, components, and systems. Perform conceptual design studies of
advanced propulsion and power components and systems, and perform mission
analysis studies. Prepare and conduct tests and acquire data. Interpret
and analyze test data. Develop, update, adapt and utilize computer
application programs. Adapt computer programs to parallel processing
hardware and workstation networking. Compare test data with calculated
results. Prepare technical reports.
C.2.2 Operations
Translate experimental requirements into designs and hardware. Design,
develop, install, and maintain experimental systems. Develop test
documentation including checkout, calibration, and operating procedures.
Coordinate professional and technician groups supporting testing
operations. Prepare safety documentation and participate in institutional
and manned-flight phased safety reviews. Lead or conduct experimental
tests. Validate data and prepare technical reports. Provide facility
documentation and configuration control.
C.2.3 Engineering Design and Development
Perform engineering and manufacturing for all phases of development of
aeronautical and space systems. This includes conceptual formulation,
requirements analysis, design, development, fabrication, functional and
environmental test, assembly, integration, operation, operational software
development, assurances of safety, reliability, and quality, and related
analyses for space flight hardware flown on manned or unmanned vehicles.
Page C-2
Description/Specification/Work Statement 12/17/97
<PAGE> 11
RFP3-085970 Section C
For human-rated projects, also perform engineering in systems safety,
materials, reliability, maintainability and associated analysis
disciplines necessary to assure compliance with NASA manned space flight
hardware requirements.
C.2.4 Administrative/Management
Plan projects including resource requirements estimates, schedules, and
progress evaluations. Develop and maintain record keeping systems,
documentation, and schedules. Conduct workshops, symposiums and
conferences. Prepare management information reports. Prepare technical
presentation material. Edit reports and documentation for publication.
C.3 SPECIFIC WORK REQUIREMENTS
The work shall be accomplished at LeRC or at the Contractor's local facility,
with travel to other locations as required. Task orders will provide the
availability of Government facilities, laboratories, equipment, and support
services. All work performed under this contract shall be in accordance with
established and applicable LeRC documents for requirements, standards,
specifications and instructions such as shuffle safety requirements,
environmental impact statements, safety, reliability and quality assurance, and
engineering standards.
C.3.1 Typical Work Areas
Listed below are typical work areas to be performed under this contract The list
below is not all inclusive and Government reserves the right to require the
performance of work considered within C.2, "Scope."
C.3.1.1 Perform conceptual design studies of advanced aircraft propulsion
systems, hypersonic and gas turbine propulsion systems and
components. Conduct engineering analysis and design of rotors,
rotor blades, stator blades, bearings, seals, inlets, nozzles,
combustors, instrumentation and other hardware in support of
advanced aeronautical propulsion systems. Conduct experimental
test programs.
Page C-3
Description/Specification/Work Statement 12/17/97
<PAGE> 12
RFP3-085970 Section C
C.3.1.2 Perform research and development of instrumentation and control
systems for aerospace applications. Develop high speed actuation
systems, high response survey probes, and associated data acquisition
systems for gas turbine engine research. Conduct engineering analysis
and design of: control consoles, electrical systems for power,
controls, and data processing; remotely controlled devices and
instrumentation at high ambient and cryogenic temperatures.
C.3.1.3 Perform research on the use of optics in propulsion control systems.
C.3.1.4 Perform materials research activities for non-strategic alloys,
thermal barrier coatings, degradation mechanisms, non-destructive
evaluation, advanced ceramics, mechanical properties of ceramics,
ceramics matrix composites, advanced composites for aircraft engine
applications, and icephobic resins. Support research on the influence
of low-gravity environments on solidification and containerless
melting. Update computer models that relate microstructure to
mechanical properties of materials. Maintain metallographic services
for research programs.
C.3.1.5 Perform high-temperature fatigue crack initiation and propagation
experiments on advanced metallic alloys, composites, and ceramics
using computer-controlled, closed-loop testing machines.
C.3.1.6 Operate high temperature fatigue and structures experimental
facilities involving controls instrumentation, data acquisition and
servo-hydraulic loading systems.
C.3.1.7 Conduct studies in the area of tribology.
C.3.1.8 Perform experimental power-transfer research programs involving
bearings, seals, shafting, gear and traction elements. Perform
experimental research testing on conventional and hybrid advanced
transmissions.
Page C-4
Description/Specification/Work Statement 12/17/97
<PAGE> 13
RFP3-085970 Section C
C.3.1.9 Perform the engineering analysis and design of dynamic space power
systems including Stirling, Brayton and Rankine energy conversion
components, heat receiver/thermal storage, mirrors, and liquid
droplet radiator thermal rejection systems.
C.3.1.10 Perform advanced space power systems research and development in such
areas as photovoltaics, electrochemistry, power management and
distribution, thermal systems and thermal management subsystems.
Validate technology for advanced space power applications relating to
low earth orbit space station power systems and space station power
system evolutionary growth capabilities.
C.3.1.11 Perform advanced space propulsion systems research and development in
such areas as Earth-to-Orbit vehicles, orbital transfer vehicles, and
auxiliary propulsion for space platforms, spacecraft, launch and
orbital transfer vehicles. Perform analyses of advanced space
propulsion systems and mission scenarios. Conduct analysis and
perform experiments to advance the technology of advanced space
propulsion components.
C.3.1.12 Perform experimental and/or theoretical studies in the general area
of reduced gravity fluid mechanics and present research results at
technical meetings. Evaluate and demonstrate appropriate diagnostic
techniques for selected reduced gravity fluids experiments.
C.3.1.13 Perform mechanical and electrical operations engineering in the LeRC
Aeropropulsion test facilities, including the following functions:
research test hardware design; daily test operations support;
facility operation and maintenance; engineering associated with
design, assembly, and operations of test support equipment, test
instrumentation, data, and control systems; and computer simulation,
engineering studies and analysis to support facility modifications,
experiment design and experiment operation.
Page C-5
Description/Specification/Work Statement 12/17/97
<PAGE> 14
RFP3-085970 Section C
C.3.1.14 Perform mechanical and electrical engineering activities required for
the documentation, configuration control and maintenance of the LeRC
Aeropropulsion test facilities.
C.3.1.15 Analyze and design the flow systems for jet fuels, gaseous or liquid
hydrogen or oxygen, high pressure air, cryogenics, high vacuum and
other fluids and mixtures.
C.3.1.16 Analyze and design closed-loop automatic controls for regulation of
interactive hydraulic and pneumatic systems. This will require
analysis of non-steady-state phenomena and transient response.
Systems designed utilize computer type programmable controllers and
micro processors.
C.3.1.17 Perform the engineering and electronic design of photovoltaic arrays,
electrochemical energy storage, DC/AC high voltage power management
and distribution components, subsystems, systems hardware and test
facilities and electronic circuits and systems layouts and packaging
for communications.
C.3.1.18 Analyze, design and develop Space Transportation System (STS or
"Space Shuttle") and International Space Station flight experiments
including requirements definition, software, configuration control,
hardware fabrication, verification testing, logistics and support for
shuttle integration.
C.3.1.19 Perform structural response analyses and experiments of aerospace
power and propulsion system components considering nonlinearities due
to high temperatures, unsteady aerodynamic and structural coupling,
vibratory and transient structural response under centrifugal and
gyroscopic loads. Perform analyses and experiments to support the
development of nonlinear constitutive modeling theories.
C.3.1.20 Develop structural analysis computer codes including probabilistic
analysis methods, structural tailoring and optimization, and fiber
composite laminate analysis. Also, develop finite element models
Page C-6
Description/Specification/Work Statement 12/17/97
<PAGE> 15
RFP3-085970 Section C
and performing structural analyses of these models representing
complex aerospace propulsion and power system components.
C.3.1.21 Develop and implement prediction codes for ice accretion. Develop
experimental icing tests and methods. Analyze experimental icing
data.
C.4 TASK ORDER ACCOUNTING
TASK ORDER DATABASE
The Contractor shall provide computer support services to the NASA COTR and
ACOTR to maintain a comprehensive task order status database. The database shall
provide administrative and financial information to track and monitor funding
and costing for each task order. The database shall also be capable of award fee
score input and data reduction.
TASK ORDER REPORTING
The Contractor shall provide a Technical Progress Report and a Cost Report for
each task order coinciding with the submission of the monthly 533M report.
The monthly Technical Progress Report will detail key technical accomplishments,
issues and action items. The report shall be forwarded to the Technical
Representative responsible for the task. A computer disk containing all the
technical progress reports will be forwarded to the COTR.
The monthly Cost Report will contain a detailed cost breakdown by cost element
for the current month, fiscal year, and contract to date charges- The report
will also reflect funding to date, funding balance and the current burnrate for
the task. The report shall be forwarded to the Technical Representative
responsible for the task.
C.5 OTHER REPORTS
From time to time the Contracting Officer or COTR may request special reports
which shall be provided.
Page C - 7
Description/Specification/Work Statement 12/17/97
<PAGE> 16
RFP3-085970 Section D
SECTION D
PACKAGING AND MARKING
---------------------
D.1 MARKING INSTRUCTIONS (LERC 52.246-90) (JAN 1987)
(a) The Contractor shall mark each shipment with the following
address(es):
National Aeronautics and Space Administration
Lewis Research Center
21000 Brookpark Road
Cleveland, OH 44135
Receiving, Bldg. 21 (Attn: Sandra L. Hardy)
(b) In addition, the contract number and the number of each container in
the shipment shall be marked in consecutive order, beginning with No. 1, on the
opposite side of each container.
(c) Each container shall include a packing list.
(End of Clause)
(END OF SECTION)
Page D-1
Packaging and Marking 12/17/97
<PAGE> 17
RFP3-085970 Section E
SECTION E
INSPECTION AND ACCEPTANCE
-------------------------
E.1 LISTING OF CLAUSES INCORPORATED BY REFERENCE
NOTICE: The following solicitation provisions and/or contract clauses
pertinent to this section are hereby incorporated by reference:
I. FEDERAL ACQUISITION REGULATION (48 CFR CHAPTER 1)
<TABLE>
<CAPTION>
CLAUSE
NUMBER DATE TITLE
------ ---- -----
<S> <C> <C>
52.246-2 AUG 1996 INSPECTION OF SUPPLIES--FIXED PRICE
52.246-3 APR 1984 INSPECTION OF SUPPLIES--COST-REIMBURSEMENT
52.246-4 AUG 1996 INSPECTION OF SERVICES--FIXED PRICE
52-246-5 APR 1984 INSPECTION OF SERVICES--COST-REIMBURSEMENT
52-246-16 APR 1984 RESPONSIBILITY FOR SUPPLIES
</TABLE>
II. NASA FAR SUPPLEMENT (48 CFR CHAPTER 18) CLAUSES
No NASA by reference clauses in Section E.
(End of Clause)
E.2 INSPECTION AND ACCEPTANCE (LERC 52.246-92) (JANUARY 1987)
Final inspection and acceptance of all work performed under this contract,
including all deliverable items, will be performed at destination.
(End of Clause)
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<PAGE> 18
RFP3-085970 Section F
SECTION F
DELIVERIES OR PERFORMANCE
-------------------------
F.1 LISTING OF CLAUSES INCORPORATED BY REFERENCE
NOTICE: The following Federal Acquisition Regulation (FAR) contract
clauses pertinent to this section are hereby incorporated by reference:
<TABLE>
<CAPTION>
CLAUSE
NUMBER DATE TITLE
------ ---- -----
<S> <C> <C>
52.211-15 SEP 1990 DEFENSE PRIORITY AND ALLOCATION
REQUIREMENTS
52.242-15 AUG 1989 STOP-WORK ORDER (ALTERNATE I) (APR 1984)
52.242-17 APR 1984 GOVERNMENT DELAY OF WORK
52.247-34 NOV 1991 F.O.B. DESTINATION
(End of Clause)
</TABLE>
F.2 PRINCIPAL PLACE OF PERFORMANCE (12-202) (OCT 1985)
The effort required under this contract shall be performed at NASA Lewis
Research Center.
(End of Clause)
F.3 DPAS RATING (LeRC 52.212-101) (SEPT 1997)
In accordance with Clause 52.211-15 of this contract, the rating is DO-C9.
(End of Clause)
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<PAGE> 19
RFP3-085970 Section F
F.4 PERIOD OF PERFORMANCE (LeRC 52.212-93) (JAN 1987)
The period of performance hereunder shall be for a period of 27 months
commencing on the award of this contract. The period of performance is
anticipated to be January 1, 1998, through March 31, 2000.
(End of Clause)
F.5 FINANCIAL MANAGEMENT REPORTS (533 REPORTS) FOR TASK ORDER CONTRACTS
(LERC 52.227-116) (AUG 1996)
A. Required Reports
The Contractor shall submit the following financial reports pursuant
to clause 18.52.242-73 "NASA Contractor Financial Management Reporting":
|_| Initial Financial Management Report (In NASA Form 533Q format)
|_| Monthly Contractor's Schedule Report
|X| NASA Form 533M (Monthly Contractor Financial Management Report)
|_| NASA Form 533Q (Quarterly Contractor Financial Management Report)
(1) The 533 reports shall be prepared in accordance with the
instructions contained in the aforementioned clause, NPG 9501.2 (NASA Contractor
Financial Management Reporting) and on the reverse of the forms. The Internet
address for NPG 9501.2 is:
http://www.hq.nasa.gov/office/codeb/npg95012.htm
B. Report Periods, Dates and Submission
(1) The cutoff date to be used for the 533 Reports is the closing
date of the Contractor's accounting month that has just been completed.
(2) The first 533M Report shall be submitted within thirty (30)
calendar days after incurrence of cost and, as with all subsequent 533M reports,
is due not later than ten (10) working days after the close of the contractor's
accounting month.
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<PAGE> 20
RFP3-085970 Section F
(3) The reports shall be submitted in the number of copies and to
the addresses on the 533M Distribution List, which will be provided at contract
start.
(End of Clause)
F.6 PHASE-IN AND PHASE-OUT
(a) Contractor Phase-In
The services provided by this contract are vital to the Government's
overall effort, and continuity must be maintained at a consistently high level
without interruption. The Contractor shall meet full performance requirements
from the start date of the contract. The phase-in period shall be approximately
30 calendar days prior to the start date of the contract. Office space will be
provided by the Government during the phase-in period.
The Contractor shall support a weekly meeting with the preceding Contractor to
discuss/identify problems or areas requiring attention during this phase-in
period. The Contractor's phase-in plan shall be submitted in accordance with the
clause in Section L, SUBFACTOR 2, MANAGEMENT PLAN.
(b) Contractor Phase-Out
Upon contract expiration, a successor may continue the work
requirements and the Contractor shall (1) furnish phase-in training and (2)
exercise its best efforts and cooperation to effect an orderly and efficient
transition to a successor commencing 60 days prior to contract expiration. The
Contractor shall support a weekly meeting with the successor Contractor to
discuss/identify problems or areas requiring attention during the phase-out
period.
(1) The Contractor shall, upon the Contracting Officer's written
notice (a) furnish support for the subsequent contractor and phase-out services
for up to 60 days prior to contract expiration and (b) negotiate in good faith a
plan with a successor to determine the nature and extent of phase-in, phase-out
services required. The plan shall specify a training program and a date for
transferring responsibilities for each task described in the plan, and shall be
subject to Contracting Officer approval. The Contractor remains responsible for
the performance of this contract during phase-in for the subsequent contractor
and the phase-out period.
(2) The Contractor shall allow as many personnel as practicable to
remain on the job to help the successor maintain the continuity and consistency
of the services required. The Contractor shall disclose necessary personnel
records and allow the successor to conduct on-site interviews with the
employees. If selected employees
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<PAGE> 21
RFP3-085970 Section F
are not agreeable to the change, the Contractor shall release them at a mutually
agreeable date and comply with Section I, FAR Clause 52.222-41, Service Contract
Act of 1965, As Amended (May 1989).
(End of Clause)
(END OF SECTION)
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<PAGE> 22
RFP3-085970 Section G
SECTION G
CONTRACT ADMINISTRATION DATA
----------------------------
G.1 LISTING OF CLAUSES INCORPORATED BY REFERENCE
NOTICE: The following solicitation provisions and/or contract clauses
pertinent to this section are hereby incorporated by reference:
I. FEDERAL ACQUISITION REGULATION (48 CFR CHAPTER 1)
<TABLE>
<CAPTION>
CLAUSE
NUMBER DATE TITLE
------ ---- -----
<S> <C> <C>
52.245-5 JAN 1986 GOVERNMENT PROPERTY (COST REIMBURSEMENT,
TIME AND MATERIAL, OR LABOR HOUR
CONTRACTS)
</TABLE>
II. NASA FAR SUPPLEMENT (48 CER CHAPTER 18) CLAUSES
<TABLE>
<CAPTION>
CLAUSE
NUMBER DATE TITLE
------ ---- -----
<S> <C> <C>
18-52.223-71 DEC 1988 FREQUENCY AUTHORIZATION
</TABLE>
(End of Clause)
G.2 NASA CONTRACTOR FINANCIAL MANAGEMENT REPORTING
(NFS 18-52.242-73) (JULY 1997)
(a) The Contractor shall submit NASA Contractor Financial Management
Reports on NASA Forms 533 in accordance with the instructions in NASA Policy
Guidance (NPG) 9501.2, NASA Contractor Financial Management Reporting, and on
the reverse side of the forms, as supplemented in the Schedule of this contract
The detailed reporting categories to be used, which shall correlate with
technical and schedule reporting, shall be set forth in the Schedule. Contractor
implementation of reporting requirements under this clause shall include NASA
approval of the
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<PAGE> 23
RFP3-085970 Section G
definitions of the content of each reporting category and give due regard to the
Contractor's established financial management information system.
(b) Lower level detail used by the Contractor for its own management
purposes to validate information provided to NASA shall be compatible with NASA
requirements.
(c) Reports shall be submitted in the number of copies, at the time, and
in the manner set forth in the Schedule or as designated in writing by the
Contracting Officer. Upon completion and acceptance by NASA of all contract line
items, the Contracting Officer may direct the Contractor to submit Form 533
reports on a quarterly basis only, report only when changes in actual cost
occur, or suspend reporting altogether.
(d) The Contractor shall ensure that its Form 533 reports include accurate
subcontractor cost data, in the proper reporting categories, for the reporting
period.
(e) If during the performance of this contract NASA requires a change in
the information or reporting requirements specified in the Schedule, or as
provided for in paragraph (a) or (c) of this clause, the Contracting Officer
shall effect that change in accordance with the Changes clause of this contract.
(End of Clause)
G.3 TECHNICAL DIRECTION
(NFS 18-52.242-70) (SEP 1993)
(a) Performance of the work under this contract is subject to the written
technical direction of the Contracting Officer Technical Representative (COTR),
who shall be specifically appointed by the Contracting Officer in writing in
accordance with NASA FAR Supplement 18-42.270. "Technical direction" means a
directive to the Contractor that approves approaches, solutions, designs, or
refinements; fills in details or otherwise completes the general description of
work or documentation items; shifts emphasis among work areas or tasks; or
furnishes similar instruction to the Contractor. Technical direction includes
requiring studies and pursuit of certain lines of inquiry regarding matters
within the general tasks and requirements in Section C of this contract.
(b) The COTR does not have the authority to, and shall not, issue any
instruction purporting to be technical direction that--
(1) Constitutes an assignment of additional work outside the
statement of work;
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RFP3-085970 Section G
(2) Constitutes a change as defined in the Changes clause;
(3) Constitutes a basis for any increase or decease in the total
estimated contract cost the fixed fee (if any), or the time required for
contract performance;
(4) Changes any of the expressed terms, conditions, or
specifications of the contract; or
(5) Interferes with the Contractor's rights to perform the terms and
conditions of the contract.
(c) All technical direction shall be issued in writing by the COTR.
(d) If in the Contractor's opinion, any instruction or direction by the
COTR falls within any of the categories defined in paragraph (b) above, the
Contractor shall not proceed but shall notify the Contracting Officer in writing
within 5 working days after receiving it and shall request the Contracting
Officer to take action as described in this clause. Upon receiving this
notification, the Contracting Officer shall either issue an appropriate contract
modification within a reasonable time or advise the Contractor in writing within
30 days that the instruction or direction is--
(1) Rescinded in its entirety; or
(2) Within the requirements of the contract and does not constitute
a change under the Changes clause of the contract and that the Contractor should
proceed promptly with its performance.
(e) Failure of the Contractor and Contracting Officer to agree that the
instruction or direction is both within the requirements of the contract and
does not constitute a change under the changes clause, or failure to agree upon
the contract action to be taken with respect to the instruction or direction,
shall be subject to the Disputes clause of this contract.
(f) Any action(s) taken by the Contractor in response to any direction
given by any person other than the Contracting Officer or the COTR shall be at
the Contractor's risk.
(End of Clause)
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<PAGE> 25
RFP3-085970 Section G
G.4 CONTRACTOR REQUESTS FOR GOVERNMENT-OWNED EQUIPMENT
(NES 18-52.245-70) (JULY 1997)
(a) "Equipment" as used in this clause, means commercially available items
capable of stand-alone use, including those to be acquired for incorporation
into special test equipment or special tooling.
(b) (1) Upon determination of need for any Government-owned equipment item
for performance of this contract the Contractor shall provide to the Contracting
Officer a written request justifying the need for the equipment and the reasons
why Contractor-owned property cannot be used, citing the applicable FAR or
contract authority for use of Government-owned equipment. Equipment being
acquired as a deliverable end item listed in the contract or as a component for
incorporation into a deliverable end item listed in the contract is exempt from
this requirement.
(2) The Contractor's request shall include a description of the item
in sufficient detail to enable the Government to screen its inventories for
available equipment or to purchase equipment. For this purpose, the Contractor
shall (i) prepare a separate DD Form 1419, DOD Industrial Plant Equipment
Requisition, or equivalent format for each item requested and (ii) forward it
through the Contractor Officer to the Industrial Property Officer at the
cognizant NASA installation at least 30 days in advance of the date the
Contractor intends to acquire the item. Multiple units of identical items may be
requested on a single form. Instructions for preparing the DD Form 1419 are
contained in NASA FAR Supplement 1845.7102. If a certificate of nonavailability
is not received within that period, the Contractor may proceed to acquire the
item, subject to having obtained Contractor Officer consent if required, and
having complied with any other applicable provisions of this contract.
(c) Contractors who are authorized to conduct their own screening using
the NASA Equipment Management System (NEMS) and other Government sources of
excess property shall provide the evidence of screening results with their
request for Contracting Officer consent Requests to purchase based on
unsuitability of items found shall include rationale for the determined
unsuitability.
(End of Clause)
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RFP3-085970 Section G
G.5 INSTALLATION-ACCOUNTABLE GOVERNMENT PROPERTY
(NFS 18-52.245-71) (JULY 1997)
(a) The Government property described in the clause at 18-52.245-77, List
of Installation Provided Property and Services, shall be made available to the
Contractor on a no-charge basis for use in performance of this contract. This
property shall be utilized only within the physical confines of the NASA
installation that provided the property. Under this clause, the Government
retains accountability for, and title to, the property, and the Contractor
assumes the following user responsibilities:
See NASA Procedures and Guidance (NPG) 4200.1 'NASA Equipment Management
Manual', NPG 4200.2 'NASA Equipment Management User's Guide or Property
Custodians', NPG 4300.1 'NASA Personal Property Disposal', and NPG 4310.4
'Identification and Disposition of NASA Artifacts' for applicable user
responsibilities."
The Contractor shall establish and adhere to a system of written
procedures for compliance with these user responsibilities. Such procedures must
include holding employees liable, when appropriate, for loss, damage, or
destruction of Government property.
(b) (1) The official accountable recordkeeping, physical inventory,
financial control, and reporting of the property subject to this clause shall be
retained by the Government and accomplished by the installation Supply and
Equipment Management Officer (SEMO) and Financial Management Officer. If this
contract provides for the Contractor to acquire property, title to which will
vest in the Government the following additional procedures apply:
(i) The Contractor's purchase order shall require the vendor
to deliver the property to the installation central receiving area;
(ii) The Contractor shall furnish a copy of each purchase
order, prior to delivery by the vendor, to the installation central receiving
area:
(iii) The Contractor shall establish a record of the property
as required by FAR 45.5 and 1845.5 and furnish to the Industrial Property
Officer a DD Form 1149 Requisition and Invoice/Shipping Document (or
installation equivalent) to transfer accountability to the Government within 5
working days after receipt of the property by the Contractor. The Contractor is
accountable for all Contractor-acquired property until the property is
transferred to the Government's accountability.
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RFP3-085970 Section G
(iv) Contractor use of Government property at an off-site
location and off-site subcontractor use require advance approval of the
Contractor Officer and notification of the SEMO. The Contractor shall assume
accountability and financial reporting responsibility for such property. The
Contractor shall establish records and property control procedures and maintain
the property in accordance with the requirements of FAR Part 45.5 until its
return to the installation.
(2) After transfer of accountability to the Government the Contractor
shall continue to maintain such internal records as are necessary to execute the
user responsibilities identified in paragraph (a) and document the acquisition,
billing, and disposition of the property. These records and supporting
documentation shall be made available, upon request to the SEMO and any other
authorized representatives of the Contracting Officer.
(End of Clause)
G.6 LIABILITY FOR GOVERNMENT PROPERTY FURNISHED FOR REPAIR OR OTHER SERVICES
(NFS 18-52.245-72) (MAR 1989)
(a) This clause shall govern with respect to any Government property
furnished to the Contractor for repair or other services that is to be returned
to the Government. Such property, hereinafter referred to as "Government
property furnished for servicing," shall not be subject to any clause of this
contract entitled Government-Furnished Property or Government Property.
(b) The official accountable record keeping and financial control and
reporting of the property subject to this clause shall be retained by the
Government. The Contractor shall maintain adequate records and procedures to
ensure that the Government property furnished for servicing can be readily
accounted for and identified at all times while in its custody or possession or
in the custody or possession of any subcontractor.
(c) The Contractor shall be liable for any loss or destruction of or
damage to the Government property furnished for servicing (1) caused by the
Contractor's failure to exercise such care and diligence as a reasonable prudent
owner of similar property would exercise under similar circumstances, or (2)
sustained while the property is being worked upon and directly resulting from
that work, including, but not limited to, any repairing, adjusting, inspecting,
servicing, or maintenance operation. The Contractor shall not be liable for loss
or destruction of or damage to Government property furnished for servicing
resulting from any other cause except to the extent that
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RFP3-085970 Section G
the loss, destruction, or damage is covered by insurance (including
sell-insurance funds or reserves).
(d) In addition to any insurance (including self-insurance funds or
reserves) carried by the Contractor and in effect on the date of this contract
affording protection in whole or in part against loss or destruction of or
damage to such Government property furnished for servicing, the amount and
coverage of which the Contractor agrees to maintain, the Contractor further
agrees to obtain any additional insurance covering such loss, destruction, or
damage that the Contracting Officer may from time to time require. The
requirements for this additional insurance shall be effected under the
procedures established by the FAR 52.243 changes clause of this contract.
(e) The Contractor shall hold the Government harmless and shall indemnify
the Government against all claims for injury to persons or damage to property of
the Contractor or others arising from the Contractor's possession or use of the
Government property furnished for servicing or arising from the presence of that
property on the Contractor's premises or property.
(End of Clause)
G.7 LIST OF INSTALLATION-ACCOUNTABLE PROPERTY AND SERVICES
(NFS 18-52.245-77) (JUL 1997)(LeRC MODIFICATION)(LeRC 52.245-106)
(AUG 1997)
In accordance with the Installation-Accountable Government Property clause
of this contract, the Contractor is authorized use of the types of property and
services listed below, to the extent they are available, while on-site at the
NASA installation.
(a) Office space, work area space, and utilities. The Contractor shall use
Government telephones for official purposes only. Pay telephone stations are
available for the convenience and use of employees in making unofficial calls,
both local and long distances.
(b) General- and special-purpose equipment including office furniture.
(1) Equipment to be made available to the Contractor for use in
performance of this contract on-site and at such other locations as approved by
the Contracting Officer is listed in Section J, Attachment B. The Government
retains accountability for this property under the Installation-Accountable
Government Property clause, regardless of its authorized location.
(2) If the Contractor acquires property as a direct cost under this
contract, this property also shall become accountable to the Government upon its
entry
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<PAGE> 29
RFP3-085970 Section G
into the NASA Equipment Management System (NEMS) in accordance with the property
reporting requirements of this contract.
(3) The Contractor shall not bring on-site for use under this
contract any property owned or leased by the Contractor, or other property that
the Contractor is accountable for under any other Government contract, without
the Contracting Officer's prior written approval.
(c) Supplies from stores stock.
(d) Publications and blank forms stocked by the installation.
(e) Safety and fire protection for Contractor personnel and facilities.
(f) Installation services facilities:
Library
Credit Union
Day Care
Exchange Store (PX)
Learning Center
Visitor Information Center
Cafeteria
(g) Fitness Center facilities under the following conditions:
(1) Applications shall be submitted to, and shall be processed by,
the support service contractor currently operating the Fitness Center for the
Government.
(2) The procedure for receiving and processing applications,
obtaining a medical authorization from a licensed physician, and selection of
applications for participation will be similar to the procedure for Government
employees.
(3) All individuals applying for participation shall sign a
statement waiving the Government from any liability for personal injury during
participation in Fitness Center activities.
(h) In all instances of severe injury, or sudden life threatening illness
(e.g. heart attack), the Emergency Medical Technician Squad shall be summoned
immediately, by dialing 911. Referrals to tertiary care centers and for private
physicians will be made in cases requiring long term follow-up, or when specific
services required are unavailable on-site.
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RFP3-085970 Section G
(i) Cafeteria privileges for Contractor employees during normal
operating hours.
(j) Building maintenance for facilities occupied by Contractor
personnel.
(k) Moving and hauling for office moves, movement of large
equipment, and delivery of supplies. Moving services shall be provided on-site,
as approved by the Contracting Officer.
(l) The user responsibilities of the Contractor are defined in
paragraph (a) of the Installation-accountable Government Property clause.
(End of Clause)
G.8 CONTRACTOR-FURNISHED TOOLS, EQUIPMENT AND MATERIAL
The Contractor shall provide all the necessary tools, equipment and materials to
perform the services outlined in the Statement of Work to the extent they are
not otherwise provided by the Government
When applicable to any of the Statement of Work tasks, direct-charge costs for
materials, replacement equipment, repair parts, and components shall be
allowable, provided the Contractor is authorized by the Contracting Officer or
his authorized representative to acquire such items in accordance with the
procedures outlined in the Statement of Work.
(End of Clause)
G.9 OPTION TO PURCHASE CONTRACTOR EQUIPMENT (NOV 1996)
At the end of the contract period of performance, the Contractor grants the
Government options for the following: (1) The Contractor agrees to sell any
Contractor-owned property used in performance of this contract to a successor
Contractor at its depreciated value based on the Contractor's depreciation
schedule; or (2) The Contractor agrees to sell any Contractor-owned property
used in performance of this contract to the Government at its depreciated value
based on the Contractor's depreciation schedule; or (3) The Contractor agrees to
utilize the depreciated property on a follow-on contract if the Contractor is
the successor Contractor; or (4) the Contractor will sell the property for fair
market value within ninety (90) days after the end of the period of performance
and will credit the contract for the amount of any excess of the sale price
minus the depreciated value and selling expenses. The
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RFP3-085970 Section G
Government may exercise one of the above options by unilateral modification
issued to the Contractor not later than thirty (30) days after the end of the
contract period of performance.
(End of Clause)
G.10 NASA PATENT REPRESENTATIVE
(LeRC 52.227-106) (MAR 1988)
Reports, invention disclosures, etc., required under the Patent Rights clause of
this contract to be submitted to NASA Patent Counsel shall be directed to the
following named representative:
NASA Lewis Research Center
Patent Counsel, Mail Stop Le-Law
21000 Brookpark Road
Cleveland, OH 44135
(End of Clause)
G.11 RIGHTS IN DATA
(LERC 52.227-90) (JAN 1987)
The data required in Item (TBD) is defined as "unlimited rights data" in
accordance with the "Rights in Data - General" clause of this contract.
(End of Clause)
G.12 SUBMISSION OF INVOICES FOR FIRM FIXED PRICE TASK ORDERS
(NOV 1996)
The Contractor shall submit an invoice (original and two duplicate originals)
for payment of firm fixed price task orders no more frequently than monthly. The
invoice shall reference the task order number on the "Order for Supplies or
Services" (form 347) which sets forth the available funding (see clause B.4,
Contract Funding). The invoice shall identify each task order as a separate line
item.
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RFP3-085970 Section G
INVOICES FOR FIXED PRICE SHALL BE SUBMIITITED TO:
Financial Management Division
NASA Lewis Research Center
Mail Stop 500-303
21000 Brookpark Road
Cleveland, OH 44135-3191
(End of Clause)
G.13 SUBMISSION OF VOUCHERS FOR COST REIMBURSABLE TASK ORDERS
(a) Cost vouchers for payment of cost-reimbursement task orders shall
include a reference to this contract and task order number on the "order for
supplies or services" (Form 347) which sets forth the available funding (see
Clause B.3 Contract Funding). Public vouchers for payment shall be forwarded to
your cognizant DCAA office. This is the designated billing office for cost
vouchers for purposes of the Prompt Payment clause of this contract.
(b) Cost vouchers, as submitted through DCAA, shall be accompanied by 2
copies of the NASA Form 533 designated to be delivered to the Cost Accounting
and Commercial Payments Branch as set forth in the Attachment H, entitled
"Individual Task Reporting Requirements" in Section J of this contract.
(c) The Contractor shall prepare vouchers identifying all cost (including
G&A, COM, OH, etc.) for each task order as a separate line item as follows:
(1) One original Standard Form (SF) 1034, SF 1035 or equivalent
Contractor's attachment.
(2) Seven copies of SF 1034A, or equivalent Contractor's attachment.
(3) The Contractor shall mark SF1034A copies 1,2,3,4 and such other
copies as may be directed by the Contracting Officer by insertion in the
memorandum block the names and addresses as follows:
(i) Copy 1 - NASA Contracting Officer;
(ii) Copy 2 - DCAA Auditor;
(iii) Copy 3 - Contractor;
(iv) Copy 4 - Contract administration office, if delegated
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RFP3-085970 Section G
(d) Fee vouchers for payment of fee shall be prepared similarly
identifying each Task as a separate line item in accordance with 18-52.216-76,
"Award Fee for Service Contracts" and be forwarded to:
NASA Lewis Research Center
Cost Accounting and Commercial Payment Branch
Mail Stop 500-303
21000 Brookpark Road
Cleveland, OH 44135
This is the designated billing office for fee vouchers for purposes of the
Prompt Payment clause of this contract.
(e) In the event that amounts are withheld from payment in accordance with
provisions of this contract, a separate voucher for the amount withheld will be
required before payment for that amount may be made.
(End of Clause)
G.14 CONTRACTING OFFICER'S TECHNICAL REPRESENTATIVE (COTR)
(LeRC 52.242-92)
A Contracting Officer's Technical Representative (COTR) will be delegated under
this contract pursuant to the clause at 18-52.242-70 entitled "Technical
Direction." The Contractor will receive a copy of this delegation at the time of
award of any contract or shortly thereafter. This delegation will take place on
a NASA Form 1634 and will list not only the COTR delegated, but also his/her
duties and responsibilities. Throughout this solicitation/contract there may be
references made to a variety of different titles, including "NASA Project
Manager," "NASA Technical Monitor," and "NASA Contract Monitor;" unless
specifically stated otherwise, these refer to the COTR. For purposes of
monitoring Contractor performance, the COTR may elect to appoint technical
representatives (TR) to assemble performance data. Any such appointed will not
have authority to direct the Contractor in performing the services.
(End of Clause)
G.15 INDIRECT COST CEILING
(LeRC 52.231-90) (JAN 1996)
(a) Reimbursement Ceiling Rates, Definitions, and Exceptions:
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RFP3-085970 Section G
(1) Final payment for Support Labor, Labor Overhead, and General and
Administrative (G&A) expenses will be based on the application of the actual
audited rate, but not in excess of the following ceilings:
<TABLE>
<CAPTION>
Ceiling Rates For Contractor
Fiscal Years (CFY)
Rate Category Base To Which Rate Applies CFY 1998 CFY 1999 CFY 2000
- ------------- -------------------------- -------- -------- --------
<S> <C> <C> <C> <C>
Support Labor Technical Productive Labor
Cost [ * ] [ * ] [ * ]
Labor Overhead Technical Productive Labor
Cost [ * ] [ * ] [ * ]
General and Total Allowable Cost
Administrative Excluding "Task Direct
(G&A) Expense Charges" and Applicable
G&A Expense. [ * ] [ * ] [ * ]
</TABLE>
(2) Definitions:
(i) "Technical Productive Labor Cost" is the direct cost,
without any burdens, of ALL personnel charging directly to task orders EXCLUDING
the following personnel and/or functions:
(A) Any Program Manager
(B) Any Department Directors
(C) Any Executive Secretary and
(D) Any Administrative Function
(ii) "Program Manager" is the individual who runs the Dynacs
organization at LeRC. This person, regardless of title classification, would be
responsible for, but not limited to, the directing and carrying on of Dynacs'
business and/or affairs as they relate to the overall performance of the
contract at LeRC.
(iii) "Department Director" are those individuals who are one
level below the "Program Manager" and who are entrusted with the overall
direction and/or operations of the "technical departments" at LeRC. The
"technical departments" are: Aeromechanics, Aerospace Technology, Aeropropulsion
Systems, and Space Experiments.
(iv) "Executive Secretary" is the individual(s) who to a
substantial degree, directly or indirectly, provides the "Program Manager" with
secretarial support.
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*Confidential information has been omitted and filed separately with the
Commission
<PAGE> 35
RFP3-085970 Section G
(v) "Administrative Function" is any personnel performing work
that benefits and/or is necessary to the overall operation of the contract such
as, but not limited to, the areas of payroll, accounting, human resources,
property, and contract management.
(vi) "Support Labor" is the direct cost without burdens, of
the personnel listed in paragraphs two (2) through five (5) above. "Support
Labor" also includes ALL OTHER personnel not classified as "Technical Productive
Labor Cost" AND not a part of General and Administrative (G&A) Expense.
(vii) "Direct Cost" is that cost associated with any personnel
who is not in a paid absence status such as, but not limited to, vacation, sick,
or holiday leave AND which is properly recorded and charged to the contract in
accordance with both your written company policy AND your Government approved
accounting system.
(viii) "Task Direct Charges" is that cost which is directly
chargeable to a task order such as, but not limited to, travel and training
directly related to a specific task AND any equipment and material directly
related to, and/or necessary for, the performance of a specific task.
(3) Exceptions:
(i) Increased labor overhead and/or G&A expense costs during
the term of this contract that result from such items as statute, court
decisions and/or written rulings or regulations by the Internal Revenue Service
or other taxing authority may be cause for adjustment of the indirect ceiling
affected.
(ii) Notwithstanding the above paragraph, in the event that
the actual rates exceed their respective ceilings, all costs in excess of the
indirect ceilings are not reimbursable under this or any other Government
contract.
(iii) The Contractor shall advise the Contracting Officer of
any planned or approved accounting changes that would impact the subject rates
and demonstrate how the changes will impact the negotiated ceilings. The
Contracting Officer may agree to change the rate ceilings, if appropriate. Where
accounting changes have the effect of moving costs from one expense pool to
another that potentially results in a circumvention around a rate ceiling(s),
the Contracting Officer shall agree to only those rate ceiling changes that
either have no effect on or decrease the net effective cost chargeable to the
contract.
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RFP3-085970 Section G
(b) Provisional Indirect Billing Rates:
The Contractor may submit interim billings based on actual, cumulative pool
costs not to exceed the lesser of the ceiling rates per paragraph (a)(l) above
or the cognizant Government auditor-approved provisional billing rates.
To prevent substantial over or under payment (except where a ceiling is
reached), the provisional billing rates shall be reviewed at least annually by
the Contractor. Whenever actual rates are either 1) + or - 2.0% of the current
billing rate for "Support Labor" and/or 2) + or - 2.0% of the current billing
rate for labor overhead and/or 3) + or - 1.0% of the current billing rate for
G&A expense, the Contractor shall propose revisions for the NASA Contracting
Officer's approval. Proposed revisions are subject to review by Government
auditors.
(End of Clause)
G.16 PAYMENT FOR OVERTIME PREMIUMS
(FAR 52.222-2) (JUL 1990)
(a) The use of overtime is authorized under this contract if the overtime
premium does not exceed $2,000 AND the overtime premium is paid for work--
(1) Necessary to cope with emergencies such as those resulting from
accidents, natural disasters, breakdowns of production equipment or occasional
production bottlenecks of a sporadic nature;
(2) By indirect-labor employees such as those performing duties in
connection with administration, protection, transportation, maintenance, standby
plant protection, operation of utilities, or accounting;
(3) To perform tests, industrial processes, laboratory procedures,
loading or unloading of transportation conveyances, and operations in flight or
afloat that are continuous in nature and cannot reasonably be interrupted or
completed otherwise; or
(4) That will result in lower overall costs to the Government.
(b) Any request for estimated overtime premiums that exceeds the amount
specified above shall include all estimated overtime for contract completion and
shall-
(1) Identify the work unit; e.g., department or section in which the
requested overtime will be used, together with present workload, staffing, and
other
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RFP3-085970 Section G
data of the affected unit sufficient to permit the Contracting Officer to
evaluate the necessity for the overtime;
(2) Demonstrate the effect that denial of the request will have on
the contract delivery or performance schedule;
(3) Identify the extent to which approval of overtime would affect
the performance or payments in connection with other Government contracts,
together with identification of each affected contract; and
(4) Provide reasons why the required work cannot be performed by
using multi-shift operations or by employing additional personnel.
(End of Clause)
G.17 CONTRACT ADMINISTRATION PLAN (NOV 1996)
In order to expedite administration of this contract the following delineation
of duties is provided. The individual or position designated as having
responsibility should be contacted for any questions, clarifications or
information regarding the function assigned:
(a) The Contracting Officer for this procurement is:
Thomas A. Spicer
Contracting Officer
NASA-Lewis Research Center
MS: 500-312
21000 Brookpark Road
Cleveland, OH 44135-3191
Telephone: (216) 433-2762
Facsimile: (216) 433-5489
Internet: [email protected]
The Contracting Officer is responsible for:
(1) All Pre-Award information, questions or data;
(2) Freedom of Information Act inquiries;
(3) All matters specified in Federal Acquisition Regulation (FAR)
42.302 and NASA FAR Supplement, except in those areas specifically designated as
the responsibility of someone else herein.
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<PAGE> 38
RFP3-085970 Section G
(b) The Contracting Officer's Technical Representative (COTR) for this
procurement is:
Sandra L. Hardy
Project Manager
NASA-Lewis Research Center
MS: 50-3
21000 Brookpark Road
Cleveland, OH 44135-3191
Telephone: (216) 433-2278
Facsimile: (216) 433-8054
Internet: [email protected]
The COTR is responsible for:
(1) All postaward information, questions or data;
(2) Changes, questions or information regarding scope, terms or
conditions of the basic contract document;
(3) Postaward conference if required;
(4) Authorization to begin performance;
(5) Certification of invoices for payment of fixed-priced task
orders;
(6) Issuance of task orders
(c) The COTR and Technical Representatives (TRs) are the Contract
Surveillance Representatives and are responsible for:
(1) Quality assurance of services performed and acceptance of services.
(2) Monitoring of Contractor performance. The TRs will be identified as
task orders are issued.
(d) The Paying Office for this contract is:
Financial Management Division
NASA-Lewis Research Center
MS: 500-303
21000 Brookpark Road
Cleveland, OH 44135-3191
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<PAGE> 39
RFP3-085970 Section G
(1) The payment office is responsible for payment of proper invoices after
acceptance is documented.
(End of Clause)
G.18 NON-FEE/PROFIT BEARING COSTS (NOV 1996)
Fee (on cost-reimbursable tasks) and profit (on fixed-price tasks) shall not be
allowed on costs for the acquisition of Government property, including general
purpose and special test or tooling equipment, and stores stock.
(End of Clause)
G.19 PAYMENT OF FIXED FEE (FAR 1852.216-75) (DEC 1988)
The fixed fee shall be paid in monthly installments based upon the percentage of
completion of work as determined by the Contracting Officer.
(End of Clause)
(END OF SECTION)
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<PAGE> 40
RFP3-085970 Section H
SECTION H
SPECIAL CONTRACT REQUIREMENTS
-----------------------------
H.1 LISTING OF CLAUSES INCORPORATED BY REFERENCE
NOTICE: The following solicitation provisions and/or contract clauses
pertinent to this section are hereby incorporated by reference:
I. FEDERAL ACQUISITION REGULATION (48 CFR CHAPTER 1)
<TABLE>
<CAPTION>
CLAUSE
NUMBER DATE TITLE
------ ---- -----
<S> <C> <C>
52-236-9 APR 1984 PROTECTION OF EXISTING VEGETATION,
STRUCTURES, EQUIPMENT, UTILITIES AND
IMPROVEMENTS
</TABLE>
II. NASA FAR SUPPLEMENT (48 CFR CHAPTER 18) CLAUSES
<TABLE>
<CAPTION>
CLAUSE
NUMBER DATE TITLE
------ ---- -----
<S> <C> <C>
18-52.208-81 AUG 93 RESTRICTIONS ON PRINTING AND DUPLICATING
18.52.223-70 MAR 97 SAFETY AND HEALTH
18.52.242-72 AUG 92 OBSERVANCE OF LEGAL HOLIDAYS
(ALTERNATE II) (SEP 89)
</TABLE>
(End of Clause)
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<PAGE> 41
RFP3-085970 Section H
H.2 SECURITY REQUIREMENTS
(FAR 52.204-2) (AUG 1996)
(a) This clause applies to the extent that this contract involves access
to information classified "Confidential," "Secret," or "Top Secret."
(b) The Contractor shall comply with (1) the Security Agreement (DD Form
441), including the "National Industrial Security Program Operating Manual" (DOD
5220.22-M), and (2) any revisions to that manual, notice of which has been
furnished to the Contractor.
(c) If, subsequent to the date of this contract the security
classification or security requirements under this contract are changed by the
Government and if the changes cause an increase or decrease in security costs or
otherwise affect any other term or condition of this contract the contract shall
be subject to an equitable adjustment as if the changes were directed under the
Changes clause of this contract.
(d) The Contractor agrees to insert terms that conform substantially to
the language of this clause, including this paragraph (d) but excluding any
reference to the Changes clause of this contract in all subcontracts under this
contract that involve access to classified information.
(End of Clause)
H.3 SECURITY REQUIREMENTS FOR CONTRACTOR EMPLOYEES
The Contractor will coordinate with the COTR five (5) working days prior to the
release of a contractor employee. Badges will be retrieved on the employee's
last work day.
(End of Clause)
H.4 SECURITY CLASSIFICATION REQUIREMENTS
(NASA 18-52.204-75) (SEPTEMBER 1989)
Performance under this contract will involve access to and/or generation of
classified information, work in a security area, or both up to the level of
Secret.
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<PAGE> 42
RFP3-085970 Section H
See Federal Acquisition Regulation clause 52.204-2 in this contract and DD Form
254, Contract Security Classification Specification, Section J. Attachment D.
(End of Clause)
H.5 SECURITY REQUIREMENTS FOR UNCLASSIFIED AUTOMATED INFORMATION RESOURCES
(NFS 1852.204-76) (SEP 1993) (LeRC MODIFICATION) (JAN 1997)
(a) The Contractor shall comply with the requirements outlined in the
current NASA Policy directive 2810.1, NASA Procedures and Guidance 2810.1 and
OHM A-130, Appendix III incorporated herein by reference. Copies may be obtained
from the Lewis Security Management Office (M.S. 21-5).
(b) In addition to complying with any functional and technical security
requirements set forth in the schedule and clauses of this contract, the
contractor shall obtain special identification, as required by the Program
Manager or the Functional Organization Computer Security Official, for its
personnel who need unescorted or unsupervised physical or electronic access to
the following limited or controlled areas, systems, programs and/or data:
___TDB_____[List areas, systems, programs and/or data]__________
________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
The Lewis Computer Security Manager will coordinate NASA Security policy and
guidelines applicable to each contractor through the appropriate Project
Computer Security personnel.
(c) The Contractor's employees may be required to sign a computer access
user agreement before they are granted access to such areas, systems, programs
and/or data. It is the responsibility of the Contractor to ensure that its
employees sign the required access to the systems for any period exceeding six
months, the Contractor shall ensure that theft employee promptly sign the
appropriate access termination statement, and that the employee promptly returns
all access codes, cards, devices, identification codes, and passwords to the
appropriate Government personnel.
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RFP3-085970 Section H
(d) The Contractor shall ensure that all employees granted access to
Federal computer systems receive annual training in computer security. Any
course materials and/or instructors, if necessary, will be provided by the
Government. Scheduling and administration of the training shall be arranged by
the Contractor and coordinated through the appropriate Program Computer Security
personnel. The Contractor shall provide a statement to the Lewis Center Computer
Security Manager (CCSM) not less than annually that the training has been
conducted for all employees with access to Federal Automated Information
Resources.
(e) Any breach of this clause or the contract shall be promptly reported
to the Contracting Officer.
(f) The Contractor shall incorporate this clause in all subcontracts where
the requirements identified in this clause are applicable to the performance of
the subcontract.
(End of Clause)
H.6 KEY PERSONNEL AND FACILITIES
(NASA 18-52.235-71) (MARCH 1989)
(a) The personnel and/or facilities listed below (or specified in the
contract Schedule) are considered essential to the work being performed under
this contract. Before removing, replacing, or diverting any of the listed or
specified personnel or facilities, the Contractor shall (1) notify the
Contracting Officer reasonably in advance and (2) submit justification
(including proposed substitutions) in sufficient detail to permit evaluation of
the impact on this contract.
(b) The Contractor shall make no diversion without the Contracting
Officer's written consent; provided that the Contracting Officer may ratify in
writing the proposed change, and that ratification shall constitute the
Contracting Officer's consent required by this clause.
(c) The list of personnel and/or facilities (shown below or as specified
in the contract Schedule) may, with the consent of the Contracting parties, be
amended from time to time during the course of the contract to add or delete
personnel and/or facilities
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<PAGE> 44
RFP3-085970 Section H
<TABLE>
<CAPTION>
Personnel Tide
--------- ----
<S> <C>
Ed Tribble General Manager
</TABLE>
(End of Clause)
H.7 PENSION PORTABILITY
(NFS 18-52.237-71) (JAN 1997)
(a) In order for pension costs attributable to employees assigned to this
contract to be allowable costs under this contract, the plans covering such
employees must:
(1) Comply with all applicable Government laws and regulations;
(2) Be a defined contribution plan, or a multiparty defined benefit
plan operated under a collective bargaining agreement. In either case, the plan
must be portable, i.e., the plan follows the employee, not the employer;
(3) Provide for 100 percent employee vesting at the earlier of one
year of continuous employee service or contract termination; and
(4) Not be modified, terminated, or a new plan adopted without the
prior written approval of the cognizant NASA Contracting Officer.
(b) The Contractor shall include paragraph (a) of this clause in
subcontracts for continuing services under a service contract if:
(1) The prime contract requires pension portability;
(2) The subcontracted labor dollars (excluding any burdens or
profit/fee) exceed $2,500,000 and ten percent of the total prime contract labor
dollars (excluding any burdens or profit/fee); and
(3) Either of the following conditions exists:
(i) There is a continuing need for the same or similar
subcontract services for a minimum of five years (inclusive of options), and
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RFP3-085970 Section H
if the subcontractor changes, a high percentage of the predecessor
subcontractor's employees are expected to remain with the program; or
(ii) The employees under a predecessor subcontract were
covered by a portable pension plan, a follow-on subcontract or a subcontract
consolidating existing services is awarded, and the total subcontract period
covered by the plan covers a minimum of five years (including both the
predecessor and successor subcontracts).
(End of Clause)
H.8 CONTRACTORS' DUTIES AND RESPONSIBILITIES ON-SITE
(LeRC 52.209-90) (OCT 1995)
I. BADGES
All Contractor personnel having a need to enter areas of the
Lewis Research Center or Plum Brook Station shall have an identification badge
or pass. This badge or pass shall be obtained at the entrance of the Lewis
Research Center or Plum Brook Station. In addition to the requirements contained
herein, the Contractor shall comply with LeRC management instruction LMZI
1900.3, Managing Conduct Issues Affecting the Center, incorporated herein by
reference and made a part hereof.
Resident Contractors (picture badged employees)
(1) The on-site company supervisor will notify the Main Gate Badge
Clerk at PABX 3-2206 when a new employee is reporting to work. The Badge Clerk
will give the company supervisor specific instructions as to how the new
employee will be badged, photographed, fingerprinted, etc.
(2) When an employee terminates and/or resigns employment, the
company supervisor will issue to the employee NASA Form C-10087, Non-NASA
Separation Clearance Record. The company supervisor or his designee will be
responsible for making an inquiry of all offices listed on the form to see if
the employee has any outstanding Government items. The employee will then take
this form to all offices that list he/she has outstanding items. The employees
last stop is for the return of their Government issued ID. badge.
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RFP3-085970 Section H
(3) Company supervisors are to ensure that the terminated and/or
resigned employee has returned his/her badge to the Main Gate Badge Clerk. Final
clearance of a Contractor upon completion of a contract will depend in part upon
accounting for all badges issued to employees during the performance of the
contract. It should be recognized that security badges are Government property
and any alteration or misuse of these badges may be prosecuted as a violation of
Section 499, Title 18, U.S. Code.
Non-Resident Contractors (non-picture badged employees)
(1) The Contractor's on-site supervisor shall comply with the Badge
and Property Regulations (NASA Form C-421) a copy of which will be given the
Contractor's supervisors at the time of the Construction Site Showing. The Badge
and Property Regulations are quoted below:
(A) The following regulations have been adopted governing the
control of Contractor's Badges at the Lewis Research Center.
1. Ensure that each company employee is in possession of
NASA Form C-9975 prior to reporting to work for badging purposes. Employees not
in possession of the above mentioned for will be delayed at the gate until such
time as the company supervisor/foreman or his representative reports to the Main
Gate with the appropriate paperwork for badging.
2. Report lost badges immediately.
3. Upon termination of duties, each employee's badge
will be collected and returned to the Main Gate Sergeant by the Contractor
supervisor/foreman. Final clearance of a Contractor upon completion of a
contract will depend in part upon the accounting for all badges issued to
employees during the performance of the contract. It should be recognized that
security badges are Government property and any alteration or misuse of these
badges may be prosecuted as a violation of Section 499, Title 18, U.S. Code.
II. NASA-OWNED PROPERTY
1. The term "NASA-Owned Property" refers to all controlled (tagged) and
non-tagged equipment library property, security badges, computer passwords and
other property furnished by the Government during the course of the contract.
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RFP3-085970 Section H
2. The Contractor shall ensure that all NASA-Owned property issued to its
employees is returned and in satisfactory condition upon termination of an
employee's duties. In cases where accountability for the property is transferred
from one employee to another, Equipment Services Office of the Logistics and
Technical Information Division must be notified. At the completion of the
Government contract, all property will be returned, and the contract value will
be adjusted for any property not accounted for.
3. When access to Federal computer systems has been granted, the
Contractor shall ensure that its employees comply with the clause of the
contract entitled "SECURITY REQUIREMENTS FOR UNCLASSIFIED INFORMATION RESOURCES
(NFS 18-52.204-76) LeRC MODIFICATION (APRIL 1991)".
III. EMERGENCIES
1. The Contractor shall ensure that its employees are informed that
Emergency, Fire, Medical, Safety, and Security assistance can be summoned by
Dialing "911" on the Center's PABX telephone system. Emergencies are defined as
incidents involving serious personal injury or damage that causes a possible
hazardous condition, or any incidents that require immediate attention of the
Plant Protection Department or Security. All other medical treatment is the
responsibility of the Contractor.
2. For incidents not classified as an emergency, contractor personnel
shall be instructed to immediately notify the Contracting Officer's Technical
Representative (COTR), Extension 3-2278 (rather than dialing "911") in the event
of an accident involving either personal injury or damage to property whether
public or private, including damage to motor vehicles. They shall cooperate
fully with the Government Accident Investigator and the Center Accident
Investigation Board. This cooperation shall include interviews at the accident
site and/or at a Board meeting.
3. The Chairman of the appropriate Accident Investigation Board will
notify the Contractor through the COTR as to the date and time and location of
the Board meeting. The Board meetings will be held between the hours of 8:15
a.m. and 4:45 p.m. regular work days Monday through Friday.
4. For Contractor duties where continuous manning of posts is mandatory
during a work shift, the Contractor shall provide substitute personnel as
required for manning these posts during the meeting of the Accident
Investigation Boards.
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RFP3-085970 Section H
IV. TRAFFIC
1. The Contractor agrees to comply, and agrees to require that all of its
personnel will comply with all posted traffic signs, signals and instructions of
personnel assigned for traffic control and parking purposes and with the
provisions of NMI 1600.2 and NHB 1620.3 incorporated herein by reference and
made a part hereof.
2. The Government reserves the right to bar from the Lewis Research Center
any Contractor employee who has failed to comply with such signs, signals,
instructions and the provisions of NMI 1600.2 and NHB 1620.3. The period of the
bar shall be as determined appropriate by the Contracting Officer subject to the
provisions of NMI 1600.2 and NHB 1620.3. The Contracting Officer will notify the
Contractor in writing, setting forth the name(s) of the affected employees(s)
and the time period(s) of the bar(s). No action by the Government in barring any
Contractor employee from the Lewis Research Center shall be the basis for any
claim whatever by the Contractor under this contract, nor shall it excuse the
Contractor from complying with any provision of this contract.
V. ON-SITE STANDARDS OF CONDUCT
1. The Contractor's entry onto the Center shall be pursuant to fulfilling
its contractual obligations, and any related activities thereto. Contractor
personnel gaining access to Lewis facilities are required to certify that they
meet the minimum ethical standards for entry onto a Government facility.
Falsification of this certification could lead to criminal prosecution.
2. The Contractor agrees to comply, and agrees to require that all of its
personnel will comply with all applicable Federal and State statutes and
regulations, NASA Management Instructions (NMI's), Lewis Management Instructions
(LMT's), and other regulations pertaining to personal conduct while on-site. Any
conduct prejudicial to the efficient operation of the Center shall be cause for
removal from the Center.
VI. PROHIBITION OF FIREARMS
Firearms or weapons of any kind are strictly prohibited at the Lewis Research
Center.
VII. SECURITY INCIDENTS
Theft of Property, Bomb threats, malicious damage and any other threat or
violent situations shall be immediately reported to the Security Office.
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RFP3-085970 Section H
VIII. PROPERTY PASSES
The Contractor shall comply with the requirements of LMI 4070.1, "Removal of
Property From Lewis Research Center by Means Other Than Shipping." In accordance
with the LMI, a Property Pass (NASA Form C-702) is required for the removal of
all Contractor owned property and equipment and must be presented to the gate
guard upon exit. This form can be obtained from the COTR (or designee) or the
Lewis employee responsible for the Contractor's presence on the Center premises.
This form must contain a complete description of the material/equipment being
removed and should be signed by the authorized Government employee. Material
relating to a specific contract or purchase order must be identified by
insertion of the appropriate contract/purchase order number on the pass by the
COTR or designee.
IX. AFTER-HOUR ACCESS
During normal working hours, 7:00 a.m. to 5:30 p.m. Monday through Friday, the
guards at the gates will permit your entrance and departure. At any other time
(other than normal hours), advance clearance is required, and may be obtained
through the Lewis/Plum Brook COTR or Inspector who will then make the request to
the Main Gate Sergeant PABX 3-2204 at Lewis and 3-3221 at Plum Brook. After-hour
clearances as approved by the COTR or Inspector are certification to the guards
as authority for admittance of a Contractor during off hours, including
Saturdays, Sundays, and Holidays.
(End of Clause)
H.9 DETERMINATIONS OF WAGE REASONABLENESS DURING CONTRACT PERFORMANCE AND
PRIOR TO EXERCISE OF OPTIONS
(LeRC 52.215-112) (SEP 1992)
(a) The Contractor is required to notify the Government at any time during
the performance of this contract when a general wage increase is contemplated
for any groups of their employees.
(End of Clause)
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RFP3-085970 Section H
H.l0 TASK ORDERING PROCEDURES
All services performed under this contract shall be subject to the Task Ordering
Procedures:
All work on the contract will be accomplished through the issuance of
performance based task orders.
Individual Task Orders may be either fixed-price or cost reimbursable.
The Contracting Officer's Technical Representative (COTR) or the Alternate COTR
will provide a task order statement of work (SOW) and a purchase request (PR) to
the contractor for each task order (TO). TOs will only be requested when the
work to be performed is within the scope of the SOW of the contract. if the
contractor believes the effort is outside the SOW of the contract, the
contractor should immediately notify the COTR.
The contractor is to provide an original and one copy of its Task Plan to the
COTR within ten days of the receipt of the request. The contractor will also
prepare and provide an Optional Form 347 to be used for funding purposes. These
documents are to be forwarded to the COTR.
The COTR will forward a copy of the Task Plan to the appointed NASA Technical
Representative (TR) for review and approval. (The TR will be a NASA employee
appointed by the COTR to monitor the work and assist the COTR. in the
performance of his/her duties.) if no corrections are to be made, the COTR. will
give the contractor a copy of the Task Plan approval letter (signed by the COTR
and TR) and the original Optional Form 347 signed by the Contracting Officer
(CO). Work can only begin after both the receipt of the approval letter and the
signed Optional Form 347.
The TO can be amended to increase or decrease the scope of work and/or change
the schedule. The same procedures are used.
The approved Task Plan represents the baseline for the Task Order to be used for
cost reporting.
At no time can work be performed on a Task Order unless there are funds on the
task order to cover the work. If a TO runs out of money at any time, the
contractor must stop work.
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RFP3-085970 Section H
In the event there is a conflict between the requirements of the Task Order and
the Contractor's approved Task Plan, the Task Order will prevail.
If at any time during the performance of a TO, NASA wishes to discontinue work,
a Stop Work Order will be issued by the CO.
TASK ORDER RESPONSE FORMAT
The following outline is to be used by the contractor for each Task Order
Response:
Task Order Response
Contractor Name
Contract Number
Task Order Number (with Amendment No., if applicable):
Requester: Requester Organization Code:
Task Title:
Background: This paragraph provides the background of the Organization
performing the work, with a statement of how this work fits into the overall
effort work effort of the organization.
Broad Scope of Work: This paragraph describes what is to be accomplished and the
primary emphasis of the work.
Specific Work Elements:
Specific Deliverables: Provides dates for the deliverables.
Government Furnished Property:
Personnel Profile: Define the personnel to accomplish the work.
Period of Performance: Include beginning and end dates.
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Cost/Price Estimate (Separate page)
Actuals Through (if the response is an amendment)
Period by FY
Technical Labor
Support Labor
Labor O/H
Task Direct Charges
Equipment/Maintenance
Travel
Subcontract(s)
Other Task Direct
G&A
Award Fee/Profit
Total Price
Hours Estimate Period by FY
Labor Categories
Actual Hours (if amendment)
Total Labor Hours
Award Fee Scoring Sheet (Separate Page)
(End of Clause)
H.l1 SAFETY AND HEALTH REPORTING REQUIREMENTS
(LERC 52.223-93) (MAR 1990)
Pursuant to the "SAFETY AND HEALTH (NFS 18-52.223-70)" clause of this contract
the following listed topics shall be reported to the Contracting Officer, or
designee:
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DELIVER TO:
(a) Accidents, incidents, or exposure resulting COTR and the
in fatality, lost-time, occupational disease, Office of
contamination of property, and property loss of Mission Safety
$25,000 or more. Copies 1 each. and Assurance
(b) Mishaps shall be reported and recorded in COTR
accordance with applicable OSHA regulations on
NASA Form 1627, NASA Mishap Report.
(c) Corrective action(s) taken as a result of COTR
safety infractions as reported on Safety and
Health Inspection Report NASA-C-151a.
(End of Clause)
H.12 GOVERNMENT-SPONSORED EDUCATION PROGRAMS
(LERC 52.237-93) (JUN 1987)
(a) At any time during the period of this contract the Government may, by
written notice, require the Contractor to participate in Government-sponsored
education programs. Such notice will be issued by the Contracting Officer to his
authorized representative, at least 30 days prior to the required participation.
Upon receipt of such notice, the Contractor shall notify his eligible employees
of the program, and require and schedule their participation.
(b) The Contractor will not be required to bear any cost of the conduct of
the program, nor will he be required to replace employees while they are
participating in the program, unless continuous staffing is required by a
specific contract provision. In the latter case, an equitable adjustment to the
"Changes" clause of this contract.
(c) The programs contemplated by this provision are general-interest
areas, such as safety, civil rights, equal employment opportunity, etc.
(End of Clause)
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H.13 SUBCONTRACTING (LERC 52.244-90) (AUG 1989)
(a) In the event the Contractor desires to have subcontractors perform any
portion of the work covered by this contract, the Contractor is hereby required
to submit the name and address of the subcontractor and the category of work
they will perform, prior to the start of any field work by the subcontractor.
(b) The contractor shall also submit prior to the start of any field work
by the subcontractor, evidence of the subcontractor's compliance with the
insurance requirements as set forth in contract Clause 52.228-5 entitled
"INSURANCE - WORK ON A GOVERNMENT INSTALLATION" and Clause 18-52.228-75 entitled
"MINIMUM INSURANCE COVERAGE".
(c) Failure of the Contractor to comply with these requirements will be
cause for the Government to bar the subcontractors, singly or collectively, from
access to the site of the work; or to stop the work from being performed by such
subcontractors, singly or collectively; until the insurance requirements have
been complied with. Such stoppage of work will not be considered cause for
equitable adjustment for time or money under the applicable clauses of the
contract.
(End of Clause)
H.14 FACILITY LEASE ASSIGNMENT (LERC 52.244-91) (OCT 1992)
(a) Pursuant to the clause 52.244-2, entitled "Subcontracts Under
Cost-Reimbursement and Letter Contracts", the Contractor shall submit for
written approval by the Contracting Officer, all facility, furniture, ADPE and
other applied equipment lease agreements pertaining to any off-site facility
where the aggregate amount is $100,000.00 or more inclusive of fee. These
agreements are considered to be subcontracts designated for special
surveillance.
(b) The Contractor hereby agrees, at the direction of the Government to
assign any and all facility leases, pertaining to contract operation and
occupancy to the successful follow-on contractor to this contract The lease
shall be assigned within 90 days after receipt of direction by the Government
and without further cost or expense to the Government.
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(c) The lease shall contain a clause with respect to 'Lease Cancellation
Privileges" which will be mutually agreeable to the Contractor and the
Government.
(d) The total of all costs for facilities shall not exceed a total amount
of $2,800,000 over the expected 27 months life of this contract.
(End of Clause)
(END OF SECTION)
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SECTION I
CONTRACT CLAUSES
----------------
I.1 LISTING OF CLAUSES INCORPORATED BY REFERENCE
This contract incorporates the following clauses by reference to their
text in the FAR, with the same force and effect as if they were provided
in full text herein. Upon request, the Contracting Officer will make their
full text available.
I. FEDERAL ACQUISITION REGULATION (48 CFR CHAPTER 1)
<TABLE>
<CAPTION>
CLAUSE
NUMBER DATE TITLE
------ ---- -----
<S> <C> <C>
52.202-1 OCT 1995 DEFINITIONS
52.203-3 APR 1984 GRATUITIES
52.203-5 APR 1984 COVENANT AGAINST CONTINGENT FEES
52.203-6 JUL 1995 RESTRICTIONS ON SUBCONTRACTOR
SALES TO THE GOVERNMENT
52.203-7 JUL 1995 ANTI-KICKBACK PROCEDURES
52.203-10 JAN 1997 PRICE OR FEE ADJUSTMENT FOR ILLEGAL OR
IMPROPER ACTIVITY
52.203-12 JUNE 1997 LIMITATION ON PAYMENTS TO INFLUENCE
CERTAIN FEDERAL TRANSACTIONS
52.204-4 JUNE 1996 PRINTING/COPYING DOUBLE-SIDED ON
RECYCLED PAPER
52.207-5 FEB 1995 OPTION TO PURCHASE EQUIPMENT
</TABLE>
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<TABLE>
<CAPTION>
<S> <C> <C>
52.209-6 JUL 1995 PROTECTING THE GOVERNMENT'S INTEREST
WHEN SUBCONTRACTING WITH CONTRACTORS
DEBARRED, SUSPENDED, OR PROPOSED FOR
DEBARMENT
52.211-15 SEP 1990 DEFENSE PRIORITY AND ALLOCATION
REQUIREMENTS
52.215-2 AUG 1996 AUDIT AND RECORDS--NEGOTIATION
52.215-27 MAR 1996 TERMINATION OF DEFINED BENEFIT PENSION
PLANS
52.215-30 SEP 1987 FACILITIES CAPITAL COST OF MONEY
52.215-33 JAN 1986 ORDER OF PRECEDENCE
52.215-39 MAR 1996 REVERSION OR ADJUSTMENT OF PLANS FOR
POST RETIREMENT BENEFITS (PRB) OTHER
THAN PENSIONS
52.215-40 FEB 1995 NOTIFICATION OF OWNERSHIP CHANGES
52.216-22 OCT 1995 INDEFINITE QUANTITY
52.219-8 JUN 1997 UTILIZATION OF SMALL, SMALL
DISADVANTAGED, AND WOMEN-OWNED SMALL
BUSINESS CONCERNS
52.222-1 FEB 1997 NOTICE TO THE GOVERNMENT OF LABOR
DISPUTES
52.222-3 AUG 1996 CONVICT LABOR
52.222-4 JUL 1995 CONTRACT WORK HOURS AND SAFETY STANDARDS
ACT - OVERTIME COMPENSATION
</TABLE>
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<TABLE>
<CAPTION>
<S> <C> <C>
52.222-28 APR 1984 EQUAL OPPORTUNITY PREAWARD CLEARANCE OF
SUBCONTRACTS
52.222-37 JAN 1988 EMPLOYMENT REPORTS ON SPECIAL DISABLED
VETERANS AND VETERANS OF THE VIETNAM ERA
52.223-2 APR 1984 CLEAN AIR AND WATER
52.223-6 JAN 1997 DRUG FREE WORKPLACE
52.223-10 MAY 1995 WASTE REDUCTION PROGRAM
52.223-14 OCT 1996 TOXIC CHEMICAL RELEASE REPORTING
52.224-1 APR 1984 PRIVACY ACT NOTIFICATION
52.224-2 APR 1984 PRIVACY ACT
52.225-9 JAN 1996 BUY AMERICAN ACT-- TRADE AGREEMENT ACT -
BALANCE OF PAYMENTS PROGRAM
52.225-11 OCT 1996 RESTRICTIONS ON CERTAIN FOREIGN
PURCHASES
52.227-1 JUL 1995 AUTHORIZATION AND CONSENT
52.227-2 AUG 1996 NOTICE AND ASSISTANCE REGARDING PATENT
AND COPYRIGHT INFRINGEMENT
52.228-5 JAN 1997 INSURANCE--WORK ON A GOVERNMENT
INSTALLATION
52.228-7 MAR 1996 INSURANCE--LIABILITY TO THIRD PERSONS
52.229-3 JAN 1991 FEDERAL, STATE, AND LOCAL TAXES
52.229-5 APR 1984 TAXES--CONTRACTS PERFORMED IN U.S.
POSSESSIONS OR PUERTO RICO
</TABLE>
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<TABLE>
<CAPTION>
<S> <C> <C>
52.232-1 APR 1984 PAYMENTS
52.232-8 MAY 1997 DISCOUNTS FOR PROMPT PAYMENT
52.232-9 APR 1984 LIMITATION ON WITHHOLDING OF PAYMENTS
52.232-11 APR 1984 EXTRAS
52.232-17 JUN 1996 INTEREST
52.232-18 APR 1984 AVAILABILITY OF FUNDS
52.232-22 APR 1984 LIMITATION OF FUNDS
52.232-23 JAN 1986 ASSIGNMENT OF CLAIMS
52.232-25 JUN 1997 PROMPT PAYMENT
52.233-1 OCT 1995 DISPUTES
52.233-3 AUG 1996 PROTEST AFTER AWARD
52.237-2 APR 1984 PROTECTION OF GOVERNMENT BUILDINGS,
EQUIPMENT, AND VEGETATION
52.237-3 JAN 1991 CONTINUITY OF SERVICES
52.242-3 OCT 1995 PENALTIES FOR UNALLOWABLE COSTS
52.242-13 JUL 1995 BANKRUPTCY
52.243-1 AUG 1987 CHANGES--FIXED PRICE (ALTERNATE I) (APR
1984)
52.243-2 AUG 1987 CHANGES--COST-REIMBURSEMENT (ALTERNATE
I) (APR 1984)
52.244-1 FEB 1995 SUBCONTRACTS (FIXED-PRICE CONTRACTS)
52.244-5 DEC 1996 COMPETITION IN SUBCONTRACTING
</TABLE>
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<TABLE>
<CAPTION>
<S> <C> <C>
52.244-6 OCT 1995 SUBCONTRACTS FOR COMMERCIAL ITEMS AND
COMMERCIAL COMPONENTS
52.245-2 DEC 1989 GOVERNMENT PROPERTY (FIXED-PRICE
CONTRACTS)
52.245-5 JAN 1986 GOVERNMENT PROPERTY (COST-REIMBURSEMENT,
TIME-AND-MATERIAL, OR LABOR-HOUR
CONTRACTS) (DEV)
52.246-16 APR 1984 RESPONSIBILITY FOR SUPPLIES
52.246-25 FEB 1997 LIMITATION OF LIABILITY -- SERVICES
52.247-63 JAN 1997 PREFERENCE FOR U.S. FLAG AIR CARRIERS
52.249-2 SEP 1996 TERMINATION FOR CONVENIENCE OF THE
GOVERNMENT (FIXED-PRICE)
52.249-6 SEP 1996 TERMINATION (COST-REIMBURSEMENT)
52.249-8 APR 1984 DEFAULT (FIXED-PRICE SUPPLY AND SERVICE)
52.249-14 APR 1984 EXCUSABLE DELAYS
52.251-1 APR 1984 GOVERNMENT SUPPLY SOURCES
52.253-1 JAN 1991 COMPUTER GENERATED FORMS
</TABLE>
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II. NASA FAR SUPPLEMENT (48 CFR CHAPTER 18) CLAUSES
<TABLE>
<CAPTION>
CLAUSE
NUMBER DATE TITLE
------ ---- -----
<S> <C> <C>
18-52.209-72 DEC 1988 COMPOSITION OF THE CONTRACTOR
18-52.219-74 SEP 1990 USE OF RURAL AREA SMALL BUSINESSES
18-52.219-77 JUL 1997 NASA MENTOR-PROTEGE PROGRAM
18-52.231-70 JUN 1995 PRECONTRACT COSTS
</TABLE>
(End of Clause)
I.2 APPROVAL OF CONTRACT
This contract is subject to the written approval of the Procurement Officer and
shall not be binding until so approved.
(End of Clause)
I.3 REQUIREMENTS FOR COST OR PRICING DATA OR INFORMATION OTHER THAN COST OR
PRICING DATA (FAR 52.215-41) (JAN 1997) ALTERNATE IV (OCT 1995)
(a) Submission of cost or pricing data is not required.
(b) Provide information described below:
See Section L, paragraph 28, form A, A.1, B, C, D and SF 1448.
(End of Clause)
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I.4 REQUIREMENTS FOR COST OR PRICING DATA OR INFORMATION OTHER THAN COST OR
PRICING DATA-MODIFICATIONS (FAR 52.215-42) (JAN 1997)
(a) Exceptions from cost or pricing data. (1) In lieu of submitting cost
or pricing data for modifications under this contract, for price adjustments
expected to exceed the threshold set forth at FAR 15.804-2(a)(1) on the date of
the agreement on price or the date of the award, whichever is later, the
Contractor may submit a written request for exception by submitting the
information described in the following subparagraphs. The Contracting Officer
may require additional supporting information, but only to the extent necessary
to determine whether an exception should be granted, and whether the price is
fair and reasonable.
(i) Identification of the law or regulation establishing the price
offered. if the price is controlled under law by periodic rulings, reviews, or
similar actions of a governmental body, attach a copy of the controlling
document, unless it was previously submitted to the contracting office.
(ii) Information on modifications of contracts or subcontracts for
commercial items.
(A) if (1) the original contract or subcontract was granted an
exception from cost or pricing data requirements because the price agreed upon
was based on adequate price competition, or prices set by law or regulation, or
was a contract or subcontract for the acquisition of a commercial item, and (2)
the modification (to the contract or subcontract) is not exempted based on one
of these exceptions, then the Contractor may provide information to establish
that the modification would not change the contract or subcontract from a
contract or subcontract for the acquisition of a commercial item to a contract
or subcontract for the acquisition of an item other than a commercial item.
(B) For a commercial item exception, the Contractor shall
provide, at a minimum, information on prices at which the same item or similar
items have previously been sold that is adequate for evaluating the
reasonableness of the price of the modification. Such information may include:
(1) For catalog items, a copy of or identification of
the catalog and its date, or the appropriate pages for the offered items, or a
statement that the catalog is on file in the buying office to which the proposal
is being submitted. Provide a copy or describe current discount policies and
price lists (published or unpublished), e.g., wholesale, original equipment
manufacturer, or reseller. Also
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explain the basis of each offered price and its relationship to the established
catalog price, including how the proposed price relates to the price of recent
sales in quantities similar to the proposed quantities.
(2) For market-priced items, the source and date or
period of the market quotation or other basis for market price, the base amount,
and applicable discounts. In addition, describe the nature of the market.
(3) For items included on an active Federal Supply
Service Multiple Award Schedule contract, proof that an exception has been
granted for the schedule item.
(4) The Contractor grants the Contracting Officer or an
authorized representative the right to examine, at any time before award, books,
records, documents, or other directly pertinent records to verify any request
for an exception under this clause, and the reasonableness of price. Access does
not extend to cost or profit information or other data relevant solely to the
Contractor's determination of the prices to be offered in the catalog or
marketplace.
(b) Requirements for cost or pricing data. If the Contractor is not
granted an exception from the requirement to submit cost or pricing data, the
following applies:
(1) The Contractor shall submit cost or pricing data on Standard
Form (SF) 1411, Contract Pricing Proposal Cover Sheet (Cost or Pricing Data
Required), with supporting attachments prepared in accordance with Table 15-2 of
FAR 15.804-6(b)(2).
(2) As soon as practical after agreement on price, but before award
(except for unpriced actions), the Contractor shall submit a Certificate of
Current Cost or Pricing Data, as prescribed by FAR 15.804-4.
(End of Clause)
I.5 LIMITATIONS ON SUBCONTRACTING (FAR 52.219-14) (DEC 1996)
(a) This clause does not apply to the unrestricted portion of a partial
set-aside.
(b) By submission of an offer and execution of a contract, the
Offeror/Contractor agrees that in performance of the contract in the case of a
contract for--
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(1) Services (except construction). At least 50 percent of the cost
of contract performance incurred for personnel shall be expended for employees
of the concern.
(2) Supplies (other than procurement from a nonmanufacturer of such
supplies). The concern shall perform work for at least 50 percent of the cost of
manufacturing the supplies, not including the cost of materials.
(3) General construction. The concern will perform at least 15
percent of the cost of the contract not including the cost of materials, with
its own employees.
(4) Construction by special trade contractors. The concern will
perform at least 25 percent of the cost of the contract not including the cost
of materials, with its own employees.
(End of Clause)
I.6 SECTION 8(a) AWARD (FAR 52.219-17) (DEC 1996)
(a) By execution of a contract, the Small Business Administration (SBA)
agrees to the following:
(1) To furnish the supplies or services set forth in the contract
according to the specifications and the terms and conditions by subcontracting
with the Offeror who has been determined an eligible concern pursuant to the
provisions of section 8(a) of the Small Business Act, as amended (15 U.S.C.
637(a)).
(2) Except for novation agreements and advance payments, delegates
to the NASA Lewis Research Center (LeRC) the responsibility for administering
the contract with complete authority to take any action on behalf of the
Government under the terms and conditions of the contract; provided, however
that the contracting agency shall give advance notice to the SBA before it
issues a final notice terminating the right of the subcontractor to proceed with
further performance, either in whole or in part, under the contract.
(3) That payments to be made under the contract will be made
directly to the subcontractor by the contracting activity.
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(4) To notify the LeRC Contracting Officer immediately upon
notification by the subcontractor that the owner or owners upon whom 8(a)
eligibility was based plan to relinquish ownership or control of the concern.
(5) That the subcontractor awarded a subcontract hereunder shall
have the right of appeal from decisions of the cognizant Contracting Officer
under the "Disputes" clause of the subcontract.
(b) The offeror/subcontractor agrees and acknowledges that it will, for
and on behalf of the SBA, fulfill and perform all of the requirements of the
contract.
(c) The offeror/subcontractor agrees that it will not subcontract the
performance of any of the requirements of this subcontract to any lower tier
subcontractor without the prior written approval of the SBA and the cognizant
Contracting Officer of the LeRC.
(End of Clause)
I.7 NOTIFICATION OF COMPETITION LIMITED TO ELIGIBLE 8(a) CONCERNS (FAR
52.219-18) (JAN 1997)
(a) Offers are solicited only from small business concerns expressly
certified by the Small Business Administration (SBA) for participation in the
SBA's 8(a) Program and which meet the following criteria at the time of
submission of offer--
(1) SIC code 8731 is specifically included in the Offeror's approved
business plan;
(2) The Offeror is in conformance with the 8(a) support limitation
set forth in its approved business plan; and
(3) The Offeror is in conformance with the Business Activity Targets
set forth in its approved business plan or any remedial action directed by the
SBA.
(b) By submission of its offer, the Offeror represents that it meets all
of the criteria set forth in paragraph (a) of this clause.
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(c) Any award resulting from this solicitation will be made to the Small
Business Administration, which will subcontract performance to the successful
8(a) offeror selected through the evaluation criteria set forth in this
solicitation.
(d) (1) Agreement A small business concern submitting an offer in its own
name agrees to furnish, in performing the contract, only end items manufactured
or produced by small business concerns in the United States. The term "United
States" includes its territories and possessions, the Commonwealth of Puerto
Rico, the trust territory of the Pacific Islands, and the District of Columbia.
If this procurement is processed under simplified acquisition procedures and the
total amount of this contract does not exceed $25,000, a small business concern
may furnish the product of any domestic firm. This subparagraph does not apply
in connection with construction or service contracts.
(2) The Dynacs Engineering Company, Inc., will notify the NASA Lewis
Research Center's Contracting Officer in writing immediately upon entering an
agreement (either oral or written) to transfer all or part of its stock or other
ownership interest to any other party.
(End of Clause)
I.8 EQUAL OPPORTUNITY (FAR 52.222-26) (APR 1984) ALTERNATE I (APR 1984)
Notice: The following terms of this clause are waived for this contract:
- ---------------------------------------------------
- ---------------------------------------------------
- ---------------------------------------------------
- ---------------------------------------------------
(a) If, during any 12-month period (including the 12 months preceding the
award of this contract), the Contractor has been or is awarded nonexempt Federal
contracts and/or subcontracts that have an aggregate value in excess of $10,000,
the Contractor shall comply with subparagraphs (b)(1) through (11) below. Upon
request the Contractor shall provide information necessary to determine the
applicability of this clause.
(b) During performing this contract, the Contractor agrees as follows:
(1) The Contractor shall not discriminate against any employee or
applicant for employment because of race, color, religion, sex, or national
origin.
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(2) The Contractor shall take affirmative action to ensure that
applicants are employed, and that employees are treated during employment,
without regard to their race, color, religion, sex, or national origin. This
shall include, but not be limited to, (i) employment, (ii) upgrading, (iii)
demotion, (iv) transfer, (v) recruitment or recruitment advertising, (vi) layoff
or termination, (vii) rates of pay or other forms of compensation, and (viii)
selection for training, including apprenticeship.
(3) The Contractor shall post in conspicuous places available to
employees and applicants for employment the notices to be provided by the
Contracting Officer that explain this clause.
(4) The Contractor shall, in all solicitations or advertisements for
employees placed by or on behalf of the Contractor, state that all qualified
applicants will receive consideration for employment without regard to race,
color, religion, sex, or national origin.
(5) The Contractor shall send, to each labor union or representative
of workers with which it has a collective bargaining agreement or other contract
or understanding, the notice to be provided by the Contracting Officer advising
the labor union or workers' representative of the Contractor's commitments under
this clause, and post copies of the notice in conspicuous places available to
employees and applicants for employment.
(6) The Contractor shall comply with Executive Order 11246, as
amended, and the rules, regulations, and orders of the Secretary of Labor.
(7) The Contractor shall furnish to the contracting agency all
information required by Executive Order 11246, as amended, and by the rules,
regulations, and orders of the Secretary of Labor. Standard Form 100 (EEO-1), or
any successor form, is the prescribed form to be filed within 30 days following
the award, unless filed within 12 months preceding the date of award.
(8) The Contractor shall permit access to its books, records, and
accounts by the contracting agency or the Office of Federal Contract Compliance
Programs (OFCCP) for the purposes of investigation to ascertain the Contractor's
compliance with the applicable rules, regulations, and orders.
(9) If the OFCCP determines that the Contractor is not in compliance
with this clause or any rule, regulation, or order of the Secretary of Labor,
this contract may be canceled, terminated, or suspended in whole or in part and
the Contractor may be declared ineligible for further Government contracts,
under the procedures authorized in Executive Order 11246, as amended. In
addition, sanctions may be
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imposed and remedies invoked against the Contractor as provided in Executive
Order 11246, as amended, the rules, regulations, and orders of the Secretary of
Labor, or as otherwise provided by law.
(10) The Contractor shall include the terms and conditions of
subparagraph (b)(1) through (11) of this clause in every subcontract or purchase
order that is not exempted by the rules, regulations, or orders of the Secretary
of Labor issued under Executive Order 11246, as amended, so that these terms and
conditions will be binding upon each subcontractor or vendor.
(11) The Contractor shall take such action with respect to any
subcontract or purchase order as the contracting agency may direct as a means of
enforcing these terms and conditions, including sanctions for noncompliance;
provided, that if the Contractor becomes involved in, or is threatened with,
litigation with a subcontractor or vendor as a result of any direction, the
Contractor may request the United States to enter into the litigation to protect
the interests of the United States.
(c) Notwithstanding any other clause in this contract, disputes relative
to this clause will be governed by the procedures in 41 CFR 60-1.1.
(End of Clause)
I.9 AFFIRMATIVE ACTION FOR SPECIAL DISABLED AND VIETNAM ERA VETERANS (FAR
52.222-35) (APR 1984) ALTERNATE I (APR 1984)
Notice: The following term(s) of this clause are waived for this contract
- ------------------------------------------
- ------------------------------------------
- ------------------------------------------
(a) Definitions.
"Appropriate office of the State employment service system," as used in
this clause, means the local office of the Federal-State national system
of public employment offices assigned to serve the area where the
employment opening is to be filled, including the District of Columbia,
Guam, Puerto Rico, Virgin Islands, American Samoa, and the Trust Territory
of the Pacific Islands.
"Openings that the Contractor proposes to fill from within its own
organization," as used in this clause, means employment openings for which
no one outside the Contractor's organization (including any affiliates,
subsidiaries, and the parent
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companies) will be considered and includes any openings that the
Contractor proposes to fill from regularly established "recall" lists.
"Openings that the Contractor proposes to fill under a customary and
traditional employer-union hiring arrangement," as used in this clause,
means employment openings that the Contractor proposes to fill from union
halls, under their customary and traditional employer-union hiring
relationship.
"Suitable employment openings," as used in this clause--
(1) Includes, but is not limited to, openings that occur in jobs
categorized as--
(i) Production and nonproduction;
(ii) Plant and office;
(iii) Laborers and mechanics;
(iv) Supervisory and nonsupervisory;
(v) Technical; and
(vi) Executive, administrative, and professional positions
compensated on a salary basis of less than $25,000 a
year; and
(2) Includes full-time employment, temporary employment of over 3
days, and part-time employment, but not openings that the Contractor proposes to
fill from within its own organization or under a customary and traditional
employer-union hiring arrangement, nor openings in an educational institution
that are restricted to students of that institution.
(b) General.
(1) Regarding any position for which the employee or applicant for
employment is qualified, the Contractor shall not discriminate against the
individual because the individual is a special disabled or Vietnam Era veteran.
The Contractor agrees to take affirmative action to employ, advance in
employment, and otherwise treat qualified special disabled and Vietnam Era
veterans without discrimination based upon their disability or veterans' status
in all employment practices such as--
(i) Employment;
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(ii) Upgrading;
(iii) Demotion or transfer;
(iv) Recruitment;
(v) Advertising;
(vi) Layoff or termination;
(vii) Rates of pay or other forms of compensation; and
(viii) Selection for training, including apprenticeship.
(2) The Contractor agrees to comply with the rules, regulations, and
relevant orders of the Secretary of Labor (Secretary) issued under the Vietnam
Era Veterans' Readjustment Assistance Act of 1972 (the Act), as amended.
(c) Listing openings.
(1) The Contractor agrees to list all suitable employment openings
existing at contract award or occurring during contract performance, at an
appropriate office of the State employment service system in the locality where
the opening occurs.
These openings include those occurring at any Contractor facility, including one
not connected with performing this contract. An independent corporate affiliate
is exempt from this requirement.
(2) State and local government agencies holding Federal contracts of
$10,000 or more shall also list all their suitable openings with the appropriate
office of the State employment service.
(3) The listing of suitable employment openings with the State
employment service system is required at least concurrently with using any other
recruitment source or effort and involves the obligations of placing a bona fide
job order, including accepting referrals of veterans and nonveterans. This
listing does not require hiring any particular job applicant or hiring from any
particular group of job applicants and is not intended to relieve the Contractor
from any requirements of Executive orders or regulations concerning
nondiscrimination in employment
(4) Whenever the Contractor becomes contractually bound to the
listing terms of this clause, it shall advise the State employment service
system, in each State where it has establishments, of the name and location of
each hiring location in the State. As long as the Contractor is contractually
bound to these terms and has so
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advised the State system, it need not advise the State system of subsequent
contracts. The Contractor may advise the State system when it is no longer bound
by this contract clause.
(5) Under the most compelling circumstances, an employment opening
may not be suitable for listing, including situations when (i) the Government's
needs cannot reasonably be supplied, (ii) listing would be contrary to national
security, or (iii) the requirement of listing would not be in the Government's
interest.
(d) Applicability.
(1) This clause does not apply to the listing of employment openings
which occur and are filled outside the 50 states, the District of Columbia,
Puerto Rico, Guam, Virgin Islands, American Samoa, and the Trust Territory of
the Pacific Islands.
(2) The terms of paragraph (c) above of this clause do not apply to
openings that the Contractor proposes to fill from within its own organization
or under a customary and traditional employer-union hiring arrangement. This
exclusion does not apply to a particular opening once an employer decides to
consider applicants outside of its own organization or employer-union
arrangement for that opening.
(e) Postings.
(1) The Contractor agrees to post employment notices stating (i) the
Contractor's obligation under the law to take affirmative action to employ and
advance in employment qualified special disabled veterans and veterans of the
Vietnam era, and (ii) the rights of applicants and employees.
(2) These notices shall be posted in conspicuous places that are
available to employees and applicants for employment. They shall be in a form
prescribed by the Director, Office of Federal Contract Compliance Programs,
Department of Labor (Director), and provided by or through the Contracting
Officer.
(3) The Contractor shall notify each labor union or representative
of workers with which it has a collective bargaining agreement or other contract
understanding, that the Contractor is bound by the terms of the Act, and is
committed to take affirmative action to employ, and advance in employment,
qualified special disabled and Vietnam Era veterans.
(f) Noncompliance. If the Contractor does not comply with the requirements
of this clause, appropriate actions may be taken under the rules, regulations,
and relevant orders of the Secretary issued pursuant to the Act.
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(g) Subcontracts. The Contractor shall include the terms of this clause in
every subcontract or purchase order of $10,000 or more unless exempted by rules,
regulations, or orders of the Secretary. The Contractor shall act as specified
by the Director to enforce the terms, including action for noncompliance.
(End of Clause)
I.10 AFFIRMATIVE ACTION FOR HANDICAPPED WORKERS (FAR 52.222-36) (APR 1984)
ALTERNATE I (APR 1984).
Notice: The following term(s) of this clause are waived for this contract:
NONE
- --------------------------------------------------------
- --------------------------------------------------------
- --------------------------------------------------------
(a) General.
(1) Regarding any position for which the employee or applicant for
employment is qualified, the Contractor shall not discriminate against any
employee or applicant because of physical or mental handicap. The Contractor
agrees to take affirmative action to employ, advance in employment and otherwise
treat qualified handicapped individuals without discrimination based upon their
physical or mental handicap in all employment practices such as--.
(i) Employment;
(ii) Upgrading;
(iii) Demotion or transfer;
(iv) Recruitment;
(v) Advertising;
(vi) Layoff or termination;
(vii) Rates of pay or other forms of compensation; and
(viii) Selection for training, including apprenticeship.
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(2) The Contractor agrees to comply with the rules, regulations, and
relevant orders of the Secretary of Labor (Secretary) issued under the
Rehabilitation Act of 1973 (29 U.S.C. 793) (the Act), as amended.
(b) Postings.
(1) The Contractor agrees to post employment notices stating
(i) the Contractor's obligation under the law to take
affirmative action to employ and advance in employment qualified handicapped
individuals and
(ii) the rights of applicants and employees.
(2) These notices shall be posted in conspicuous places that are
available to employees and applicants for employment. They shall be in a form
prescribed by the Director, Office of Federal Contract Compliance Programs,
Department of Labor (Director), and provided by or through the Contracting
Officer.
(3) The Contractor shall notify each labor union or representative
of workers with which it has a collective bargaining agreement or other contract
understanding, that the Contractor is bound by the terms of Section 503 of the
Act and is committed to take affirmative action to employ, and advance in
employment, qualified physically and mentally handicapped individuals.
(c) Noncompliance. If the Contractor does not comply with the requirements
of this clause, appropriate actions may be taken under the rules, regulations,
and relevant orders of the Secretary issued pursuant to the Act.
(d) Subcontracts. The Contractor shall include the terms of this clause in
every subcontract or purchase order in excess of $2,500 unless exempted by
rules, regulations, or orders of the Secretary. The Contractor shall act as
specified by the Director to enforce the terms, including action for
noncompliance.
(End of Clause)
I.11 SERVICE CONTRACT ACT OF 1965, AS AMENDED (FAR 52.22241) (MAY 1989)
(a) Definitions. "Act," as used in this clause, means the Service Contract
Act of 1965, as amended (41 U.S.C. 351, et seq.).
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"Contractor," as used in this clause or in any subcontract, shall be
deemed to refer to the subcontractor, except in the term "Government Prime
Contractor."
"Service employee," as used in this clause, means any person engaged
in the performance of this contract other than any person employed in a bona
fide executive, administrative, or professional capacity, as these terms are
defined in Part 541 of Tide 29, Code of Federal Regulations, as revised. It
includes all such persons regardless of any contractual relationship that may be
alleged to exist between a Contractor or subcontractor and such persons.
(b) Applicability. This contract is subject to the following provisions
and to all other applicable provisions of the Act and regulations of the
Secretary of Labor (29 CFR Part 4). This clause does not apply to contracts or
subcontracts administratively exempted by the Secretary of Labor or exempted by
41 U.S.C. 356, as interpreted in Subpart C of 29 CFR Part 4.
(c) Compensation.
(1) Each service employee employed in the performance of this
contract by the Contractor or any subcontractor shall be paid not less than the
minimum monetary wages and shall be furnished fringe benefits in accordance with
the wages and fringe benefits determined by the Secretary of Labor, or
authorized representative, as specified in any wage determination attached to
this contract.
(2) (i) If a wage determination is attached to this contract, the
Contractor shall classify any class of service employee which is not listed
therein and which is to be employed under the contract (i.e., the work to be
performed is not performed by any classification listed in the wage
determination) so as to provide a reasonable relationship (i.e., appropriate
level of skill comparison) between such unlisted classifications and the
classifications listed in the wage determination. Such conformed class of
employees shall be paid the monetary wages and furnished the fringe benefits as
are determined pursuant to the procedures in this paragraph (c).
(ii) This conforming procedure shall be initiated by the
Contractor prior to the performance of contract work by the unlisted class of
employee. The Contractor shall submit Standard Form (SF) 1444, Request for
Authorization of Additional Classification and Rate, to the Contracting Officer
no later than 30 days after the unlisted class of employee performs any contract
work. The Contracting Officer shall review the proposed classification and rate
and promptly submit the completed SF 1444 (which must include information
regarding the agreement or disagreement of the employees' authorized
representatives or the employees themselves together with the agency
recommendation), and all pertinent information to the Wage and Hour Division,
Employment Standards Administration, U.S. Department of Labor. The
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Wage and Hour Division will approve, modify, or disapprove the action or render
a final determination in the event of disagreement within 30 days of receipt or
will notify the Contracting Officer within 30 days of receipt that additional
time is necessary.
(iii) The final determination of the conformance action by the
Wage and Hour Division shall be transmitted to the Contracting Officer who shall
promptly notify the Contractor of the action taken. Each affected employee shall
be furnished by the Contractor with a written copy of such determination or it
shall be posted as a part of the wage determination.
(iv) (A) The process of establishing wage and fringe benefit
rates that bear a reasonable relationship to those listed in a wage
determination cannot be reduced to any single formula. The approach used may
vary from wage determination to wage determination depending on the
circumstances. Standard wage and salary administration practices which rank
various job classifications by pay grade pursuant to point schemes or other job
factors may, for example, be relied upon. Guidance may also be obtained from the
way different jobs are rated under Federal pay systems (Federal Wage Board Pay
System and the General Schedule) or from other wage determinations issued in the
same locality. Basic to the establishment of any conformable wage rate(s) is the
concept that a pay relationship should be maintained between job classifications
based on the skill required and the duties performed.
(B) In the case of a contract modification, an exercise
of an option, or extension of an existing contract, or in any other case where a
Contractor succeeds a contract under which the classification in question was
previously conformed pursuant to paragraph (c) of this clause, a new conformed
wage rate and fringe benefits may be assigned to the conformed classification by
indexing (i.e., adjusting) the previous conformed rate and fringe benefits by an
amount equal to the average (mean) percentage increase (or decrease, where
appropriate) between the wages and fringe benefits specified for all
classifications to be used on the contract which are listed in the current wage
determination, and those specified for the corresponding classifications in the
previously applicable wage determination. Where conforming actions are
accomplished in accordance with this paragraph prior to the performance of
contract work by the unlisted class of employees, the Contractor shall advise
the Contracting Officer of the action taken but the other procedures in
subdivision (c)(2)(ii) of this clause need not be followed.
(C) No employee engaged in performing work on this
contract shall in any event be paid less than the currently applicable minimum
wage specified under section (6)(a)(1) of the Fair Labor Standards Act of 1938,
as amended.
(v) The wage rate and fringe benefits finally determined under
this subparagraph (c)(2) of this clause shall be paid to all employees
performing in the
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classification from the first day on which contract work is performed by them in
the classification. Failure to pay the unlisted employees the compensation
agreed upon by the interested parties and/or finally determined by the Wage and
Hour Division retroactive to the date such class of employees commenced contract
work shall be in violation of the Act and this contract.
(vi) Upon discovery of failure to comply with subparagraph
(c)(2) of this clause, the Wage and Hour Division shall make a final
determination of conformed classification, wage rate, and/or fringe benefits
which shall be retroactive to the date such class or classes of employees
commenced contract work.
(3) Adjustment of Compensation. If the term of this contract is more
than 1 year, the minimum monetary wages and fringe benefits required to be paid
or furnished thereunder to service employees under this contract shall be
subject to adjustment after 1 year and not less often than once every 2 years,
under wage determinations issued by the Wage and Hour Division.
(d) Obligation to Furnish Fringe Benefits. The Contractor or subcontractor
may discharge the obligation to furnish fringe benefits specified in the
attachment or determined under subparagraph (c)(2) of this clause by furnishing
equivalent combinations of bona fide fringe benefits, or by making equivalent or
differential cash payments, only in accordance with Subpart D of 29 CFR Part 4.
(e) Minimum Wage. In the absence of a minimum wage attachment for this
contract, neither the Contractor nor any subcontractor under this contract shall
pay any person performing work under this contract (regardless of whether the
person is a service employee) less then the minimum wage specified by section
6(a)(1) of the Fair Labor Standards Act of 1938. Nothing in this clause shall
relieve the Contractor or any subcontractor of any other obligation under law or
contract for payment of a higher wage to any employee.
(f) Successor Contracts. If this contract succeeds a contract subject to
the Act under which substantially the same services were furnished in the same
locality and service employees were paid wages and fringe benefits provided for
in a collective bargaining agreement, in the absence of the minimum wage
attachment for this contract setting forth such collectively bargained wage
rates and fringe benefits, neither the Contractor nor any subcontractor under
this contract shall pay any service employee performing any of the contract work
(regardless of whether or not such employee was employed under the predecessor
contract), less than the wages and fringe benefits provided for in such
collective bargaining agreement, to which such employee would have been entitled
if employed under the predecessor contract, including accrued wages and fringe
benefits and any prospective increases in wages and fringe benefits provided for
under such agreement. No Contractor or subcontractor under this contract may be
relieved of the foregoing obligation unless the
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limitations of 29 CFR 4.1b(b) apply or unless the Secretary of Labor or the
Secretary's authorized representative finds, after a hearing as provided in 29
CFR 4.10 that the wages and/or fringe benefits provided for in such agreement
are substantially at variance with those which prevail for services of a
character similar in the locality, or determines, as provided in 29 CFR 4.11,
that the collective bargaining agreement applicable to service employees
employed under the predecessor contract was not entered into as a result of
arm's length negotiations. Where it is found in accordance with the review
procedures provided in 29 CFR 4.10 and/or 4.11 and Parts 6 and 8 that some or
all of the wages and/or fringe benefits contained in a predecessor Contractor's
collective bargaining agreement are substantially at variance with those which
prevail for services of a character similar in the locality, and/or that the
collective bargaining agreement applicable to service employees employed under
the predecessor contract was not entered into as a result of arm's length
negotiations, the Department will issue a new or revised wage determination
setting forth the applicable wage rates and fringe benefits. Such determination
shall be made part of the contract or subcontract, in accordance with the
decision of the Administrator, the Administrative Law Judge, or the Board of
Service Contract Appeals, as the case may be, irrespective of whether such
issuance occurs prior to or after the award of a contract or subcontract (53
Comp. Gen. 401 (1973)). In the case of a wage determination issued solely as a
result of a finding of substantial variance, such determination shall be
effective as of the date of the final administrative decision.
(g) Notification to Employees. The Contractor and any subcontractor under
this contract shall notify each service employee commencing work on this
contract of the minimum monetary wage and any fringe benefits required to be
paid pursuant to this contract, or shall post the wage determination attached to
this contract. The poster provided by the Department of Labor (Publication WH
1313) shall be posted in a prominent and accessible place at the worksite.
Failure to comply with this requirement is a violation of section 2(a)(4) of the
Act and of this contract.
(h) Safe and Sanitary Working Conditions. The Contractor or subcontractor
shall not permit any part of the services called for by this contract to be
performed in buildings or surroundings or under working conditions provided by
or under the control or supervision of the Contractor or subcontractor which are
unsanitary, hazardous, or dangerous to the health or safety of the service
employees. The Contractor or subcontractor shall comply with the safety and
health standards applied under 29 CFR Part 1925.
(i) Records.
(1) The Contractor and each subcontractor performing work subject to
the Act shall make and maintain for 3 years from the completion of the work, and
make them available for inspection and transcription by authorized
representatives of the
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Wage and Hour Division, Employment Standards Administration, a record of the
following:
(i) For each employee subject to the Act--
(A) Name and address and social security number;
(B) Correct work classification or classifications, rate
or rates of monetary wages paid and fringe benefits provided, rate or rates of
payments in lieu of fringe benefits, and total daily and weekly compensation;
(C) Daily and weekly hours worked by each employee; and
(D) Any deductions, rebates, or refunds from the total
daily or weekly compensation of each employee.
(ii) For those classes of service employees not included in
any wage determination attached to this contract, wage rates or fringe benefits
determined by the interested parties or by the Administrator or authorized
representative under the terms of paragraph (c) of this clause. A copy of the
report required by subdivision (c)(2)(ii) of this clause will fulfill this
requirement.
(iii) Any list of the predecessor Contractor's employees which
had been furnished to the Contractor as prescribed by paragraph (n) of this
clause.
(2) The Contractor shall also make available a copy of this contract
for inspection or transcription by authorized representatives of the Wage and
Hour Division.
(3) Failure to make and maintain or to make available these records
for inspection and transcription shall be a violation of the regulations and
this contract, and in the case of failure to produce these records, the
Contracting Officer, upon direction of the Department of Labor and notification
to the Contractor, shall take action to cause suspension of any further payment
or advance of funds until the violation ceases.
(4) The Contractor shall permit authorized representatives of the
Wage and Hour Division to conduct interviews with employees at the worksite
during normal working hours.
(j) Pay Periods. The Contractor shall unconditionally pay to each employee
subject to the Act all wages due free and clear and without subsequent deduction
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(except as otherwise provided by law or Regulations, 29 CFR Part 4), rebate, or
kickback on any account. These payments shall be made no later than one pay
period following the end of the regular pay period in which the wages were
earned or accrued. A pay period under this Act may not be of any duration longer
than semi-monthly.
(k) Withholding of Payments and Termination of Contract. The Contracting
Officer shall withhold or cause to be withheld from the Government Prime
Contractor under this or any other Government contract with the Prime Contractor
such sums as an appropriate official of the Department of Labor requests or such
sums as the Contracting Officer decides may be necessary to pay underpaid
employees employed by the Contractor or subcontractor. In the event of failure
to pay any employees subject to the Act all or part of the wages or fringe
benefits due under the Act, the Contracting Officer may, after authorization or
by direction of the Department of Labor and written notification to the
Contractor, take action to cause suspension of any further payment or advance of
funds until such violations have ceased. Additionally, any failure to comply
with the requirements of this clause may be grounds for termination of the right
to proceed with the contract work. In such event, the Government may enter into
other contracts or arrangements for completion of the work, charging the
Contractor in default with any additional cost.
(l) Subcontracts. The Contractor agrees to insert this clause in all
subcontracts subject to the Act.
(m) Collective Bargaining Agreements Applicable to Service Employees. If
wages to be paid or fringe benefits to be furnished any service employees
employed by the Government Prime Contractor or any subcontractor under the
contract are provided for in a collective bargaining agreement which is or will
be effective during any period in which the contract is being performed, the
Government Prime Contractor shall report such fact to the Contracting Officer,
together with full information as to the application and accrual of such wages
and fringe benefits, including any prospective increases, to service employees
engaged in work on the contract, and a copy of the collective bargaining
agreement. Such report shall be made upon commencing performance of the
contract, in the case of collective bargaining agreements effective at such
time, and in the case of such agreements or provisions or amendments thereof
effective at a later time during the period of contract performance such
agreements shall be reported promptly after negotiation thereof.
(n) Seniority List. Not less than 10 days prior to completion of any
contract being performed at a Federal facility where service employees may be
retained in the performance of the succeeding contract and subject to a wage
determination which contains vacation or other benefit provisions based upon
length of service with a Contractor (predecessor) or successor (29 CFR 4.173),
the incumbent Prime Contractor shall furnish the Contracting Officer a certified
list of the names of all service
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employees on the Contractor's or subcontractor's payroll during the last month
of contract performance. Such list shall also contain anniversary dates of
employment on the contract either with the current or predecessor Contractors of
each such service employee. The Contracting Officer shall turn over such list to
the successor Contractor at the commencement of the succeeding contract.
(o) Rulings and Interpretations. Rulings and interpretations of the Act
are contained in Regulations, 29 CFR Part 4.
(p) Contractor's Certification.
(1) By entering into this contract, the Contractor (and officials
thereof) certifies that neither it (nor he or she) nor any person or firm who
has a substantial interest in the Contractor's firm is a person or firm
ineligible to be awarded Government contracts by virtue of the sanctions imposed
under section 5 of the Act.
(2) No part of this contract shall be subcontracted to any person or
firm ineligible for award of a Government contract under section 5 of the Act
(3) The penalty for making false statements is prescribed in the
U.S. Criminal Code, 18 U.S.C. 1001.
(q) Variations, Tolerances, and Exemptions Involving Employment.
Notwithstanding any of the provisions in paragraphs (b) through (o) of this
clause, the following employees may be employed in accordance with the following
variations, tolerances, and exemptions, which the Secretary of Labor, pursuant
to section 4(b) of the Act prior to its amendment by Pub. L. 92473, found to be
necessary and proper in the public interest or to avoid serious impairment of
the conduct of Government business.
(1) Apprentices, student-learners, and workers whose earning
capacity is impaired by age, physical or mental deficiency, or injury may be
employed at wages lower than the minimum wages otherwise required by section
2(a)(1) or 2(b)(1) of the Act without diminishing any fringe benefits or cash
payments in lieu thereof required under section 2(a)(2) of the Act, in
accordance with the conditions and procedures prescribed for the employment of
apprentices, student-learners, handicapped persons, and handicapped clients of
sheltered workshops under section 14 of the Fair Labor Standards Act of 1938, in
the regulations issued by the Administrator (29 CFR Parts 520, 521, 524, and
525).
(2) The Administrator will issue certificates under the Act for the
employment of apprentices, student-learners, handicapped persons, or handicapped
clients of sheltered workshops not subject to the Fair Labor Standards Act of
1938, or subject to different minimum rates of pay under the two acts,
authorizing appropriate
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rates of minimum wages (but without changing requirements concerning fringe
benefits or supplementary cash payments in lieu thereof), applying procedures
prescribed by the applicable regulations issued under the Fair Labor Standards
Act of 1938 (29 CFR Parts 520, 521, 524, and 525).
(3) The Administrator will also withdraw, annul, or cancel such
certificates in accordance with the regulations in 29 CFR Parts 525 and 528.
(r) Apprentices. Apprentices will be permitted to work at less than the
predetermined rate for the work they perform when they are employed and
individually registered in a bona fide apprenticeship program registered with a
State Apprenticeship Agency which is recognized by the U.S. Department of Labor,
or if no such recognized agency exists in a State, under a program registered
with the Bureau of Apprenticeship and Training, Employment and Training
Administration, U.S. Department of Labor. Any employee who is not registered as
an apprentice in an approved program shall be paid the wage rate and fringe
benefits contained in the applicable wage determination for the journeyman
classification of work actually performed. The wage rates paid apprentices shall
not be less than the wage rate for their level of progress set forth in the
registered program, expressed as the appropriate percentage of the journeyman's
rate contained in the applicable wage determination. The allowable ratio of
apprentices to journeymen employed on the contract work in any craft
classification shall not be greater than the ratio permitted to the Contractor
as to his entire work force under the registered program.
(s) Tips. An employee engaged in an occupation in which the employee
customarily and regularly receives more than $30 a month in tips may have the
amount of these tips credited by the employer against the minimum wage required
by section 2(a)(1) or section 2(b)(1) of the Act, in accordance with section
3(m) of the Fair Labor Standards Act and Regulations 29 CFR Part 531. However,
the amount of credit shall not exceed $1.34 per hour beginning January 1, 1981.
To use this provision--
(1) The employer must inform tipped employees about this tip credit
allowance before the credit is utilized;
(2) The employees must be allowed to retain all tips (individually
or through a pooling arrangement and regardless of whether the employer elects
to take a credit for tips received);
(3) The employer must be able to show by records that the employee
receives at least the applicable Service Contract Act minimum wage through the
combination of direct wages and tip credit; and
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(4) The use of such tip credit must have been permitted under any
predecessor collective bargaining agreement applicable by virtue of section 4(c)
of the Act.
(t) Disputes Concerning Labor Standards. The U.S. Department of Labor has
set forth in 29 CFR Parts 4, 6, and 8 procedures for resolving disputes
concerning labor standards requirements. Such disputes shall be resolved in
accordance with those procedures and not the Disputes clause of this contract.
Disputes within the meaning of this clause include disputes between the
Contractor (or any of its subcontractors) and the contracting agency, the U.S.
Department of Labor, or the employees or their representatives.
(End of Clause)
I.12 SERVICE CONTRACT ACT (SCA) MINIMUM WAGES AND FRINGE BENEFITS
(FAR 52.222-47) (MAY 1989)
An SCA wage determination applicable to this work has been requested from the
U.S. Department of Labor. If an SCA wage determination is not incorporated
herein, the bidders/offerors shall consider the economic terms of the collective
bargaining agreement (CBA) between the incumbent Contractors Cortez III Service
Corporation and International Brotherhood of Teamsters Local 293 and Ozanne
Construction Company and International Brotherhood of Teamsters, Chaufeurs,
Warehousemen and Helpers of America, Local Union 416. If the economic terms of
the collective bargaining agreement or the collective bargaining agreement
itself is not attached to the solicitation, copies can be obtained from the
Contracting Officer. Pursuant to Department of Labor Regulation, 29 CFR 4.1b and
paragraph (g) of the clause at 52.222-41, Service Contract Act of 1965, as
amended, the economic terms of that agreement will apply to the contract
resulting from this solicitation, notwithstanding the absence of a wage
determination reflecting such terms, unless it is determined that the agreement
was not the result of arm's length negotiations or that after a hearing pursuant
to section 4(c) of the Act, the economic terms of the agreement are
substantially at variance with the wages prevailing in the area.
(End of Clause)
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I.13 HAZARDOUS MATERIAL IDENTIFICATION AND MATERIAL SAFETY DATA
(FAR 52.223-3) (JAN 1997) ALTERNATE I (JUL 1995)
(a) "Hazardous material," as used in this clause, includes any material
defined as hazardous under the latest version of Federal Standard No. 313
(including revisions adopted during the term of the contract).
(b) The offeror must list any hazardous material, as defined in paragraph
(a) of this clause, to be delivered under this contract The hazardous material
shall be properly identified and include any applicable identification number,
such as National Stock Number or Special Item Number. This information shall
also be included on the Material Safety Data Sheet submitted under this
contract.
Material
(If none, insert "None") Identification No.
- ----------------------- ------------------------
- ----------------------- ------------------------
- ----------------------- ------------------------
(c) This list must be updated during performance of the contract whenever
the Contractor determines that any other material to be delivered under this
contract is hazardous.
(d) The apparently successful offeror agrees to submit, for each item as
required prior to award, a Material Safety Data Sheet, meeting the requirements
of 29 CFR 1910.1200(g) and the latest version of Federal Standard No. 313, for
all hazardous material identified in paragraph (b) of this clause. Data shall be
submitted in accordance with Federal Standard No. 313, whether or not the
apparently successful offeror is the actual manufacturer of these items. Failure
to submit the Material Safety Data Sheet prior to award may result in the
apparently successful offeror being considered nonresponsible and ineligible for
award.
(e) If, after award, there is a change in the composition of the item(s)
or a revision to Federal Standard No. 313, which renders incomplete or
inaccurate the data submitted under paragraph (d) of this clause, the Contractor
shall promptly notify the Contracting Officer and resubmit the data.
(f) Neither the requirements of this clause nor any act or failure to act
by the Government shall relieve the Contractor of any responsibility or
liability for the safety of Government, Contractor, or subcontractor personnel
or property.
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(g) Nothing contained in this clause shall relieve the Contractor from
complying with applicable Federal, State, and local laws, codes, ordinances, and
regulations (including the obtaining of licenses and permits) in connection with
hazardous material.
(h) The Government's rights in data furnished under this contract with
respect to hazardous material are as follows:
(1) To use, duplicate and disclose any data to which this clause is
applicable. The purposes of this right are to--
(i) Apprise personnel of the hazards to which they may be
exposed in using, handling, packaging, transporting, or disposing of hazardous
materials;
(ii) Obtain medical treatment for those affected by the
material; and
(iii) Have others use, duplicate, and disclose the data for
the Government for these purposes.
(2) To use, duplicate, and disclose data furnished under this
clause, in accordance with subparagraph (h)(1) of this clause, in precedence
over any other clause of this contract providing for rights in data.
(3) The Government is not precluded from using similar or identical
data acquired from other sources.
(i) Except as provided in paragraph (i)(2), the Contractor
shall prepare and submit a sufficient number of Material Safety Data Sheets
(MSDS's), meeting the requirements of 29 CFR 1910.1200(g) and the latest version
of Federal Standard No. 313, for all hazardous materials identified in paragraph
(b) of this clause.
(1) For items shipped to consignees, the Contractor
shall include a copy of the MSDS's with the packing list or other suitable
shipping document which accompanies each shipment. Alternatively, the Contractor
is permitted to transmit MSDS's to consignees in advance of receipt of shipments
by consignees, if authorized in writing by the Contracting Officer.
(2) For items shipped to consignees identified by
mailing address as agency depots, distribution centers or customer supply
centers, the Contractor shall provide one copy of the MSDS's in or on each
shipping container. If
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affixed to the outside of each container, the MSDS's must be placed in a weather
resistant envelope.
(End of Clause)
I.14 RIGHTS TO PROPOSAL DATA (TECHNICAL)
(FAR 52.227-23) (JUN 1987)
Except for data contained on pages TBD, it is agreed that as a condition of
award of this contract, and notwithstanding the conditions of any notice
appearing thereon, the Government shall have unlimited rights (as defined in the
"Rights in Data-- General" clause contained in this contract) in and to the
technical data contained in the proposal dated TBD, upon which this contract is
based.
(End of Clause)
I.15 AVAILABILITY OF FUNDS FOR THE NEXT FISCAL YEAR
(FAR 52.232-19) (APR 1984)
Funds are not presently available for performance under this contract beyond
TBD. The Government's obligation for performance of this contract beyond that
date is contingent upon the availability of appropriated funds from which
payment for contract purposes can be made. No legal liability on the part of the
Government for any payment may arise for performance under this contract beyond
TBD, until funds are made available to the Contracting Officer for performance
and until the Contractor receives notice of availability, to be confirmed in
writing by the Contracting Officer.
(End of Clause)
I.16 SUBCONTRACTS (COST-REIMBURSEMENT AND LETTER CONTRACTS)
(FAR 52.244-2) (OCT 1997) ALTERNATE I (AUG 1996)
(a) "Subcontract" as used in this clause, includes but is not limited to
purchase orders, and changes and modifications to purchase orders. The
Contractor shall notify the Contracting Officer reasonably in advance of
entering into any subcontract if--
(1) The proposed subcontract is of the cost-reimbursement,
time-and-materials, or labor-hour type;
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(2) The proposed subcontract is fixed-price and exceeds the greater
of--
(i) The simplified acquisition threshold; or
(ii) 5 percent of the total estimated cost of this contract.
(3) The proposed subcontract has experimental, developmental, or
research work as one of its purposes; or
(4) This contract is not a facilities contract and the proposed
subcontract provides for the fabrication, purchase, rental, installation, or
other acquisition of special test equipment valued in excess of $25,000 or of
any items of facilities.
(b) (1) In the case of a proposed subcontract that--
(i) Is of the cost-reimbursement time-and-materials, or labor-
hour type and is estimated to exceed $25,000, including any fee;
(ii) Is proposed to exceed $100,000; or
(iii) Is one of a number of subcontracts with a single
subcontractor, under this contract for the same or related supplies or services
that, in the aggregate, are expected to exceed $100,000, the advance
notification required by paragraph (a) above shall include the information
specified in subparagraph (b)(2) of this clause.
(2) (i) A description of the supplies or services to be
subcontracted.
(ii) Identification of the type of subcontract to be used.
(iii) Identification of the proposed subcontractor and an
explanation of why and how the proposed subcontractor was selected, including
the competition obtained.
(iv) The proposed subcontract price and the Contractor's cost
or price analysis.
(v) The subcontractor's current, complete, and accurate cost
or pricing data and Certificate of Current Cost or Pricing Data, if required by
other contract provisions.
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(vi) The subcontractor's Disclosure Statement or Certificate
relating to Cost Accounting Standards when such data are required by other
provisions of this contract.
(vii) A negotiation memorandum reflecting--
(A) The principal elements of the subcontract price
negotiations;
(B) The most significant considerations controlling
establishment of initial or revised prices;
(C) The reason cost or pricing data were or were not
required;
(D) The extent if any, to which the Contractor did not
rely on the subcontractor's cost or pricing data in determining the price
objective and in negotiating the final price;
(E) The extent to which it was recognized in the
negotiation that the subcontractor's cost or pricing data were not accurate,
complete, or current; the action taken by the Contractor and the subcontractor;
and the effect of any such defective data on the total price negotiated;
(F) The reasons for any significant difference between
the Contractor's price objective and the price negotiated; and
(G) A complete explanation of the incentive fee or
profit plan when incentives are used. The explanation shall identify each
critical performance element, management decisions used to quantify each
incentive element, reasons for the incentives, and a summary of all trade-off
possibilities considered.
(c) The Contractor shall obtain the Contracting Officer's written consent
before placing any subcontract for which advance notification is required under
paragraph (a) above. However, the Contracting Officer may ratify in writing any
such subcontract. Ratification shall constitute the consent of the Contracting
Officer.
(d) If the Contractor has an approved purchasing system and the
subcontract is within the scope of such approval, the Contractor may enter into
the subcontracts described in subparagraphs (a)(1) and (a)(2) of this clause
without the consent of the Contracting Officer.
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(e) Even if the Contractor's purchasing system has been approved, the
Contractor shall obtain the Contracting Officer's written consent before placing
subcontracts identified below:
- ----------------------------------------------
- ----------------------------------------------
- ----------------------------------------------
(f) Unless the consent of approval specifically provides otherwise,
neither consent by the Contracting Officer to any subcontract nor approval of
the Contractor's purchasing system shall constitute a determination--
(1) Of the acceptability of any subcontract terms or conditions;
(2) Of the allowability of any cost under this contract; or
(3) To relieve the Contractor of any responsibility for performing
this contract.
(g) No subcontract placed under this contract shall provide for payment on
a cost-plus-a-percentage-of-cost basis, and any fee payable under
cost-reimbursement type subcontracts shall not exceed the fee limitations in
paragraph 15.404-4(c)(4)(i) of the Federal Acquisition Regulation (FAR).
(h) The Contractor shall give the Contracting Officer immediate written
notice of any action or suit filed and prompt notice of any claim made against
the Contractor by any subcontractor or vendor that, in the opinion of the
Contractor, may result in litigation related in any way to this contract, with
respect to which the Contractor may be entitled to reimbursement from the
Government.
(i) To facilitate small business participation in subcontracting, the
Contractor agrees to provide progress payments on subcontracts under this
contract that are fixed-price subcontracts with small business concerns in
conformity with the standards for customary progress payments stated in FAR
32.502-1 and 32.504(f), as in effect on the date of this contract. The
Contractor further agrees that the need for such progress payments will not be
considered a handicap or adverse factor in the award of subcontracts.
(j) The Government reserves the right to review the Contractor's
purchasing system as set forth in FAR Subpart 44.3.
(End of Clause)
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I.17 MANDATORY INFORMATION FOR ELECTRONIC FUNDS TRANSFER PAYMENT
(FAR 52.232-33) (AUG 1996)
(a) Method of payment. Payments by the Government under this contract,
including invoice and contract financing payments, may be made by check or
electronic funds transfer (EFT) at the option of the Government. If payment is
made by EFT, the Government may, at its option, also forward the associated
payment information by electronic transfer. As used in this clause, the term
"EFT" refers to the funds transfer and may also include the information
transfer.
(b) Mandatory submission of Contractor's EFT information.
(1) The Contractor is required, as a condition to any payment under
this contract, to provide the Government with the information required to make
payment by EFT as described in paragraph (d) of this clause, unless the payment
office determines that submission of the information is not required. However,
until January 1, 1999, in the event the Contractor certifies in writing to the
payment office that the Contractor does not have an account with a financial
institution or an authorized payment agent, payment shall be made by other than
EFT. For any payments to be made after January 1, 1999, the Contractor shall
provide EFT information as described in paragraph (d) of this clause.
(2) If the Contractor provides EFT information applicable to
multiple contracts, the Contractor shall specifically state the applicability of
this EFT information in terms acceptable to the payment office.
(c) Contractor's EFT information. Prior to submission of the first request
for payment (whether for invoice or contract financing payment) under this
contract, the Contractor shall provide the information required to make contract
payment by EFT, as described in paragraph (d) of this clause, directly to the
Government payment office named in this contract. If more than one payment
office is named for the contract, the Contractor shall provide a separate notice
to each office. In the event that the EFT information changes, the Contractor
shall be responsible for providing the changed information to the designated
payment office(s).
(d) Required EFT information. The Government may make payment by EFT
through either an Automated Clearing House (ACH) subject to the banking laws of
the United States or the Federal Reserve Wire Transfer System at the
Government's option. The Contractor shall provide the following information for
both methods in a form acceptable to the designated payment office. The
Contractor may supply this data for this or multiple contracts (see paragraph
(b) of this clause).
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(1) The contract number to which this notice applies.
(2) The Contractor's name and remittance address, as stated in the
contract and account number at the Contractor's financial agent.
(3) The signature (manual or electronic, as appropriate), title, and
telephone number of the Contractor official authorized to provide this
information.
(4) For ACH payments only:
(i) Name, address, and 9-digit Routing Transit Number of the
Contractor's financial agent.
(ii) Contractor's account number and the type of account
(checking, saving, or lockbox).
(5) For Federal Reserve Wire Transfer System payments only:
(i) Name, address, telegraphic abbreviation, and the 9-digit
Routing Transit Number for the Contractor's financial agent.
(ii) If the Contractor's financial agent is not directly
on-line to the Federal Reserve Wire Transfer System and, therefore, not the
receiver of the wire transfer payment, the Contractor shall also provide the
name, address, and 9-digit Routing Transit Number of the correspondent financial
institution receiving the wire transfer payment.
(e) Suspension of payment.
(1) Notwithstanding the provisions of any other clause of this
contract, the Government is not required to make any payment under this contract
until after receipt, by the designated payment office, of the correct EFT
payment information from the Contractor or a certificate submitted in accordance
with paragraph (b) of this clause. Until receipt of the correct EFT information,
any invoice or contract financing request shall be deemed not to be a valid
invoice or contract financing request as defined in the Prompt Payment clause of
this contract.
(2) If the UT information changes after submission of correct EFT
information, the Government shall begin using the changed EFT information no
later than the 30th day after its receipt to the extent payment is made by EFT.
However, the Contractor may request that no further payments be made until the
changed EFT information is implemented by the payment office. If such suspension
would result in a late payment under the Prompt Payment clause of this contract,
the Contractor's request
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for suspension shall extend the due date for payment by the number of days of
the suspension.
(f) Contractor EFT arrangements. The Contractor shall designate a single
financial agent capable of receiving and processing the electronic funds
transfer using the EFT methods described in paragraph (d) of this clause. The
Contractor shall pay all fees and charges for receipt and processing of
transfers.
(g) Liability for uncompleted or erroneous transfers.
(1) If an uncompleted or erroneous transfer occurs because the
Government failed to use the Contractor-provided EFT information in the correct
manner, the Government remains responsible for (i) making a correct payment,
(ii) paying any prompt payment penalty due, and (iii) recovering any erroneously
directed funds.
(2) If an uncompleted or erroneous transfer occurs because
Contractor-provided EFT information was incorrect at the time of Government
release of the EFT payment transaction instruction to the Federal Reserve
System, and--
(i) If the funds are no longer under the control of the
payment office, the Government is deemed to have made payment and the Contractor
is responsible for recovery of any erroneously directed funds; or
(ii) If the funds remain under the control of the payment
office, the Government retains the right to either make payment by mail or
suspend the payment in accordance with paragraph (e) of this clause.
(h) EFT and prompt payment.
(1) A payment shall be deemed to have been made in a timely manner
in accordance with the Prompt Payment clause of this contract if, in the EFT
payment transaction instruction given to the Federal Reserve System, the date
specified for settlement of the payment is on or before the prompt payment due
date, provided the specified payment date is a valid date under the rules of the
Federal Reserve System.
(2) When payment cannot be made by EFT because of incorrect EFT
information provided by the Contractor, no interest penalty is due after the
date of the uncompleted or erroneous payment transaction, provided that notice
of the defective EFT information is issued to the Contractor within 7 days after
the Government is notified of the defective EFT information.
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(i) EFT and assignment of claims. If the Contractor assigns the proceeds
of this contract as provided for in the Assignment of Claims clause of this
contract the assignee shall provide the assignee EFT information required by
paragraph (d) of this clause. In all respects, the requirements of this clause
shall apply to the assignee as if it were the Contractor. EFT information which
shows the ultimate recipient of the transfer to be other than the Contractor, in
the absence of a proper assignment of claims acceptable to the Government, is
incorrect EFT information within the meaning of paragraph (e) of this clause.
(j) Payment office discretion. If the Contractor does not wish to receive
payment by EFT methods for one or more payments, the Contractor may submit a
request to the designated payment office to refrain from requiring EFT
information or using the EFT payment method. The decision to grant the request
is solely that of the Government.
(k) Change of EFT information by financial agent. The Contractor agrees
that the Contractor's financial agent may notify the Government of a change to
the routing transit number, Contractor account number, or account type. The
Government shall use the changed data in accordance with paragraph (e)(2) of
this clause. The Contractor agrees that the information provided by the agent is
deemed to be correct information as if it were provided by the Contractor. The
Contractor agrees that the agent's notice of changed EFT data is deemed to be a
request by the Contractor in accordance with paragraph (e)(2) that no further
payments be made until the changed EFT information is implemented by the payment
office.
(End of Clause)
I.18 CLAUSES INCORPORATED BY REFERENCE
(FAR 52.252-2) (JUN 1988)
This contract incorporates one or more clauses by reference, with the same force
and effect as if they were given in full text. Upon request the Contracting
Officer will make their full text available.
(End of Clause)
I.19 MINIMUM INSURANCE COVERAGE
(NASA 18-52.228-75) (OCT 1988)
The Contractor shall obtain and maintain insurance coverage as follows for the
performance of this contract:
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RFP3-085970 Section I
(a) Worker's compensation and employer's liability insurance as required
by applicable Federal and state workers' compensation and occupational disease
statutes. If occupational diseases are not compensable under those statutes,
they shall be covered under the employer's liability section of the insurance
policy, except when contract operations are so commingled with the Contractor's
commercial operations that it would not be practical. The employer's liability
coverage shall be at least $100,000, except in States with exclusive or
monopolistic funds that do not permit workers' compensation to be written by
private carriers.
(b) Comprehensive general (bodily injury) liability insurance of at least
$500,000 per occurrence.
(c) Motor vehicle liability insurance written on the comprehensive form of
policy which provides for bodily injury and property damage liability covering
the operation of all motor vehicles used in connection with performing the
contract. Policies covering motor vehicles operated in the United States shall
provide coverage of at least $200,000 per person and $500,000 per occurrence for
bodily injury liability and $20,000 per occurrence for property damage. The
amount of liability coverage on other policies shall be commensurate with any
legal requirements of the locality and sufficient to meet normal and customary
claims.
(d) Comprehensive general and motor vehicle liability policies shall
contain a provision worded as follows:
"The insurance company waives any right of subrogation against
the United States of America which may arise by reason of any payment under the
policy."
(e) When aircraft are used in connection with performing the contract,
aircraft public and passenger liability insurance of at least $200,000 per
person and $500,000 per occurrence for bodily injury, other than passenger
liability, and $200,000 per occurrence for property damage. Coverage for
passenger liability bodily injury shall be at least $200,000 multiplied by the
number of seats or passengers, whichever is greater.
(End of Clause)
I.20 LIMITATION OF FUNDS (FIXED-PRICE CONTRACT)
(NASA 18-52.232-77) (MAR 1989)
(a) Of the total price of items TBD through TBD, the sum of $TBD is
presently available for payment and allotted to this contract It is
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RFP3-085970 Section I
anticipated that from time to time additional funds will be allocated to the
contract in accordance with the following schedule, until the total price of
said items is allotted:
SCHEDULE FOR ALLOTMENT OF FUNDS
Date Amounts
[Insert schedule for allotment of funds]
TBD
- -----------------------------------------------------
- -----------------------------------------------------
- -----------------------------------------------------
- -----------------------------------------------------
(b) The Contractor agrees to perform or have performed work on the items
specified in paragraph (a) above up to the point at which, if this contract is
terminated pursuant to the Termination for Convenience of the Government clause
of this contract, the total amount payable by the Government (including amounts
payable for subcontracts and settlement costs) pursuant to paragraphs (f) and
(g) of that clause would, in the exercise of reasonable judgment by the
Contractor, approximate the total amount at the time allotted to the contract.
The Contractor is not obligated to continue performance of the work beyond that
point. The Government is not obligated in any event to pay or reimburse the
Contractor more than the amount from time to time allotted to the contract,
anything to the contrary in the Termination for Convenience of the Government
clause notwithstanding.
(c) (1) It is contemplated that funds presently allotted to this contract
will cover the work to be performed until TBD.
(2) If funds allotted are considered by the Contractor to be
inadequate to cover the work to be performed until that date, or an agreed date
substituted for it, the Contractor shall notify the Contracting Officer in
writing when within the next 60 days the work will reach a point at which, if
the Contractor is terminated pursuant to the Termination for Convenience of the
Government clause of this contract, the total amount payable by the Government
(including amounts payable for subcontracts and settlement costs) pursuant to
paragraphs (f) and (g) of that clause will approximate 75 percent of the total
amount then allotted to the contract.
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(3) (i) The notice shall state the estimated date when the point
referred to in subparagraph (2) above will be reached and the estimated amount
of additional funds required to continue performance to the date specified in
subparagraph (1) above, or an agreed date substituted for it.
(ii) The Contractor shall, 60 days in advance of the date
specified in subparagraph (1) above, or an agreed date substituted for it advise
the Contracting Officer in writing as to the estimated amount of additional
funds required for the timely performance of the contract for a further period
as may be specified in the contract or otherwise agreed to by the parties.
(4) If, after the notification referred to in subdivision (3)(ii)
above, additional funds are not allotted by the date specified in subparagraph
(1) above, or an agreed date substituted for it, the Contracting Officer shall,
upon the Contractor's written request terminate this contract on that date or on
the date set forth in the request, whichever is later, pursuant to the
Termination for Convenience of the Government clause.
(d) When additional funds are allotted from time to time for continued
performance of the work under this contract, the parties shall agree on the
applicable period of contract performance to be covered by these funds. The
provisions of paragraphs (b) and (c) above shall apply to these additional
allotted funds and the substituted date pertaining to them, and the contract
shall be modified accordingly.
(e) If, solely by reason of the Government's failure to allot additional
funds in amounts sufficient for the timely performance of this contract, the
Contractor incurs additional costs or is delayed in the performance of the work
under this contract, and if additional funds are allotted, an equitable
adjustment shall be made in the price or prices (including appropriate target,
billing, and ceiling prices where applicable) of the items to be delivered, or
in the time of delivery, or both.
(f) The Government may at any time before termination, and, with the
consent of the Contractor, after notice of termination, allot additional funds
for this contract.
(g) The provisions of this clause with respect to termination shall in no
way be deemed to limit the rights of the Government under the default clause of
this contract. The provisions of this Limitation of Funds clause are limited to
the work on and allotment of funds for the items set forth in paragraph (a)
above. This clause shall become inoperative upon the allotment of funds for the
total price of said work except for rights and obligations then existing under
this clause.
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RFP3-085970 Section I
(h) Nothing in this clause shall affect the right of the Government to
terminate this contract pursuant to the Termination for Convenience of the
Government clause of this contract.
(End of Clause)
(END OF SECTION)
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RFP3-085970 Section J
PART III - LIST OF DOCUMENTS, EXHIBITS AND OTHER
ATTACHMENTS
SECTION J
LIST OF ATTACHMENTS
-------------------
The following document or lists are available on the internet or included as
hard copy in the RFP. Exceptions to this are noted below.
No.
Attachment Description Pages
- ---------- ----------- -----
A List of Installation-Provided Government Property 58
(Available in hard copy in Reading Room)
Page J-1
List of Attachments 12/17/97
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RFP3-085970 Section J
SECTION J
ATTACHMENT A
LIST OF INSTALLATION-PROVIDED
GOVERNMENT PROPERTY
(Available in hard copy in Reading Room)
List of Installation-Provided Government Property 09/29/97
<PAGE> 99
June 11, 1998
To: Mr. Ed Tribble
From: Suren Singhal
Subject: List of SETAR II Deliverables.
Based on Contract # NAS3-98008 Solicitation Offer & Award Document, issued
9-30-97, a preliminary list of SETAR II deliverables follows.
Warning: Although this list should be near complete, it is not based on a
thorough study & may have missed some deliverables.
<PAGE> 100
SETAR II DELIVERABLES - page 1 of xx (A Preliminary List)
Task Order Technical & Cost Information
Deliverable Due Date To Whom Ref. (page #)
- ----------- -------- ------- ------------
Task Order Database COTR & ACOTR C-7
Description: Computer Support Services to maintain a comprehensive task
order status database. The database shall provide administrative &
financial information to track & monitor funding and costing for each task
order. The database shall also be capable of award fee score input and
data reduction.
Technical Progress Report TR C-7
for each task
Description: The monthly Technical Progress Report will detail key
technical accomplishments, issues, and action items.
Computer Disk containing all COTR C-7
Technical Progress Reports
Cost Report for each task TR C-7
Description: The monthly Cost Report will contain a detailed cost
breakdown by cost element for the current month, fiscal year, and contract
to date charges. The report will also reflect funding to date, funding
balance, and the current burnrate for the task.
Monthly 533 Report C-7
Other Reports C-7
Description: From time to time, Co or COTR may request special reports
which shall be provided.
New Task orders COTR H-ll&12
Description: All work on the contract will be accomplished through the
issuance of performance based task orders.
Individual task orders may be either fixed-price or cost reimbursable (10%
of total contract tasks limit on fixed-price??)
Celine, p1. type C from page H-11 & 12.
Please see pages H-12&13 for Task Order Response Format (attached
herewith)
<PAGE> 101
SETAR II DELIVERABLES - page 2 of xx (A Preliminary List)
Cost Reimbursement Information
Deliverable Due Date To Whom Ref. (page #)
- ----------- -------- ------- ------------
Cost Vouchers G-1l&12
Description: (a) Cost vouchers for payment of cost-reimbursement task
orders shall include a reference to this contract and task order number on
the "Order for Supplies or Services" Form 347 which sets forth the
available funding (see Clause B.3 Contract Funding)
(b) Cost vouchers, as submitted through DCAA, shall be accompanied by 2
copies of the NASA Form 533 designated to be delivered to the Cost
Accounting and Commercial Payments Branch as set forth in the Attachment
H, entitled "Individual Task Reporting Requirements" in Section J of this
contract.
(c) The contractor shall prepare vouchers identifying all cost (including
G&A, COM, OH, etc.) for each task order as a separate line item as
follows:
(1) One original Standard Form (SF) 1034, SF 1035 or equivalent
Contractor's attachment.
(2) Seven copies of SF 1034A, or equivalent Contractor's attachment.
(3) The contractor shall mark SF1034A copies 1,2,3,4 and such other copies
as may be directed by the Contracting Officer by insertion in the
memorandum block the names and addresses as follows:
(i) Copy 1 - NASA Contracting Officer;
(ii) Copy 2 - DCAA Auditor;
(iii) Copy 3 - Contractor;
(iv) Copy 4 - Contract administration office, if delegated
(d) Fee vouchers for payment of fee shall be prepared similarly
identifying each task as a separate line item in accordance with
18-52.216-76, "Award Fee for Service contracts" and be forwarded to:
NASA Lewis Research Center
Cost Accounting and Commercial Payment Branch
Mail Stop 500-303
21000 Brookpark Road
Cleveland, OH 44135
This is the designated billing office for fee vouchers for
<PAGE> 102
purposes of the Prompt Payment clause of the contract.
(e) In the event that amounts are withheld from payment in accordance with
provisions of this contract, a separate voucher for the amount withheld
will be required before payment for that amount may be made.
<PAGE> 103
SETAR II DELIVERABLES - page 2 of xx (A Preliminary List)
Request for Government-Owned Equipment
Deliverable Due Date To Whom Ref. (page #)
- ----------- -------- ------- ------------
Written Request 30 days CO G-4
before use
Description: Upon determination of need for any Government-owned equipment
item for performance of this contract, the contractor shall provide to CO
a written request justifying the need for the equipment and the reasons
why contractor-owned property can not be used, citing the applicable FAR
or contract authority for use of Government-owned equipment. Equipment
being acquired as a deliverable end item listed in the contract or as a
component for incorporation into a deliverable end item listed in the
contract is exempt from this requirement.
The contractor's - Celine, p1. insert A from page G-4
<PAGE> 104
SETAR II DELIVERABLES - page 2 of xx (A Preliminary List)
Key Personnel and Facilities
Deliverable Due Date To Whom Ref. (page #)
- ----------- -------- ------- ------------
Written Justification reasonably CO H-4
in advance
Description: Celine, p1. insert B from page H-4
<PAGE> 105
Contract Ceilings/Surprises/Requirements to Watch
Award Fee/Profit Data:
o Profit = $?? (page B-2)
o Max Total Fixed Fee = $?? (page B-2)
o Max Award Fee Pool = $?? (page B-2)
o No Fee/Profit on acquisition of govt. property (page G-18)
o AF plan may be revised unilaterally by govt. prior to
beginning of a new rating period (page B-3)
o Govt. may put AF>85% in a reserve (page B-3)
Contract Data:
o Contract Minimum = $6M (page B-2)
o Contract Maximum = $43.760345M (page B-2)
o Max Fixed Price Contract = 86,940 hours (page B-2)
Cost:
o Indirect cost ceilings (page G-13)
o Under/Over billing ceilings (page G-15)
o Overtime $2K (page G-l5)
Government Owned Equipment:
o Contractor can buy equipment on task if it is a deliverable or is a
component for incorporation into a deliverable. Except for this,
need CO approval to get equipment as GOE 30 days prior to need. May
buy with CO consent after 30 days if not available as GOE (page
G-4).
o Contractor use of govt. property at off-site locations needs SEMO
approval (page G-6).
o Contractor Liability (page G-6&7)
o Contractor needs approval to take contractor property on-site (page
G-8)
Patents & Rights in Data:
Page G-10 and I-30
Personnel Issues:
o Notify COTR 5 days prior to release of contractor employee. Return
badge on last day (page H-2).
o Any change in certain key personnel and facilities be reported to CO
in advance with justification to permit evaluation of impact on
contract and to get written consent of CO (page H-4).
<PAGE> 106
o List of key personnel & facilities may, with govt. consent, be
amended from time to time (page H-4)
o Employees be informed of 911 for emergencies (page H-8).
o Nonemergency accidents be notified to COTR (page H-8)
Reporting:
o Monthly Technical Progress Report comprised of key technical
accomplishments, issues, and action items for each task to TRs and a
disk containing all Monthly Progress Reports to COTR within 10 days
of closing of accounting month, exception: 30 days only for June,
1998 (page C-7)
o Monthly Cost Report comprised of cost details for current month, FY,
and contract to date charges, funding to date, funding balance, and
current burn rate to for each task to TRs and 533M and
Administrative & Financial Information Database to COTR within 10
days of closing of accounting month, exception: 30 days only for
June, 1998 (page C-7). The CO may direct contractor to submit 533 at
a different interval (page G-2).
Security Requirements:
o Vision tests, annual training in computer security (pages H-4&8)
Vouchers:
o Submit invoice for FFP payment no more frequently than monthly (page
G-10) and paid monthly (page G-18).
o Cost vouchers should include 1034, 1035, and 1034A (page G-ll).
<PAGE> 107
NASA NAS3-98008
Mods & Amendments
Add to Basic contract
<PAGE> 108
<TABLE>
<S> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT 1. CONTRACT ID CODE PAGE OF PAGES
1 of 2
- ------------------------------------------------------------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO. 3. EFFECTIVE DATE 4. REQUISITION/PURCHASE REQ.NO. 5. PROJECT NO. (if applicable)
1 11-9-98 N/A
- ------------------------------------------------------------------------------------------------------------------------------------
6. ISSUED BY CODE 0616/TAS 7. ADMINISTERED BY (IF OTHER THAN ITEM 6) CODE
------------ ------------
NASA Lewis Research Center
Thomas A. Spicer
Services and Construction Branch
21000 Brookpark Road, Mail Stop 500-312
Cleveland, OH 44135-3191
- ------------------------------------------------------------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State and Zip Code) |_| 9A. AMENDMENT OF SOLICITATION NO.
Dynacs Engineering Company Inc. ---------------------------------------------
2001 Aerospace Parkway 9B. DATED (SEE ITEM 11)
Brookpark, Ohio 44142
---------------------------------------------
|X| 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS3-98008
---------------------------------------------
10B. DATED (SEE ITEM 13)
CODE (PF)(9) FACILITY CODE 12-17-98
- ------------------------------------------------------------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- ------------------------------------------------------------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour and date specified for receipt of Offers |_| is
extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date specified in the solicitation or as amended, by one of
the following methods:
(a) By completing Items 8 and 15, and returning ___ copies of the amendment; (b) By acknowledging receipt of this amendment on each
copy of the offer submitted; or (c) By separate letter or telegram which includes a reference to the solicitation and amendment
numbers. FAILURE OF YOUR ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND DATE
SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this amendment you desire to change an offer already submitted,
such change may be made by telegram or letter, provided each telegram or letter makes reference to the solicitation and this
amendment, and is received prior to the opening hour and date specified.
- ------------------------------------------------------------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (if required)
N/A
- ------------------------------------------------------------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- ------------------------------------------------------------------------------------------------------------------------------------
|_| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE
CONTRACT ORDER NO. IN ITEM 10A.
- ------------------------------------------------------------------------------------------------------------------------------------
|_| B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (such as changes in paying
office, appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR 43.103(b).
- ------------------------------------------------------------------------------------------------------------------------------------
|X| C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
Mutual Agreement
- ------------------------------------------------------------------------------------------------------------------------------------
|_| D. OTHER (Specify type of modification and authority)
- ------------------------------------------------------------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document and return 1 copies to the issuing office.
- ------------------------------------------------------------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings, including solicitation/contract subject matter
where feasible.)
(1) On October 28, 1998, consent was given to subcontract for assets owned by Federal Data Corporation(FDC). The assets shall be
depreciated over the 24 months remaining on the contract using the sum-of-years-digits depreciation method. These assets are
subject to clause G.9, "Option to Purchase Contractor Equipment (Nov 1996):
- ------------------------------------------------------------------------------------------------------------------------------------
Except as provided herein, all terms and conditions of the document referenced in Item 9A or 10A, as heretofore changed, remains
unchanged and in full force and effect.
- ------------------------------------------------------------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print) 16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
KEVIN M. MCQUADE; DIR. BUSINESS & ADMIN Thomas A. Spicer, Contracting Officer
- ------------------------------------------------------------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED 16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /s/ Kevin M. McQuade 11-9-98 BY /s/ Thomas A. Spicer 11/9/98
---------------------------------------- ---------------------------------------
(Signature of person authorized to sign) (Signature of Contracting Officer)
- ------------------------------------------------------------------------------------------------------------------------------------
NSN 7540-01-152-807030-105 30-105 STANDARD FORM 30 (REV. 10-83)
PREVIOUS EDITION UNUSABLE Prescribed by GSA
FAR (48 CFR) 53.243
DUPLICATE ORIGINAL
</TABLE>
<PAGE> 109
At the end of the contract period of performance, the contractor grants the
Government options for the following: (l) the Contractor agrees to sell any
Contractor-owned property used in the performance of this contract to a
successor Contractor at its depreciated value based on the Contractor's
depreciation schedule; or (2) The Contractor agrees to sell any
Contractor-owned property used in performance of this contract to the
Government at its depreciated value based on the Contractor's depreciation
schedule; or (3) The contractor agrees to utilize the depreciated property on a
follow-on contract if the Contractor is the Successor Contractor; or (4) the
Contractor will sell the property for fair market value within ninety days after
the end of period of performance and will credit the contract for the amount in
excess of the sale price minus the depreciated value and selling expenses. The
Government may exercise one of the above options by unilateral modification
issued to the Contractor not later than thirty (30) days after the end of the
contract period of performance.
(2) The following requirements are made a part of The Statement of Work:
(a) "Year 2000 compliant," as used herein, means that the information technology
(hardware, software and firmware, including embedded systems or any other
electro-mechanical or processor-based systems used in accordance with its
associated documentation) accurately processes date and date-related data
(including, but not limited to, calculating, comparing and sequencing) from,
into, and between the twentieth and twenty-first centuries, and the years 1999
and 2000 and leap year calculations, to the extent that other information
technology being acquired, properly exchanges date and date-related data with
it.
(b) Any information technology provided, operated and/or maintained under this
must be Year 2000 compliant. To ensure this result, the Contractor shall provide
documentation describing how the information technology (IT) items or services
demonstrate Year 2000 compliance.
(c) Milestones for Renovation, Validation and Implementation: Any IT determined
to be non-year 2000 compliant shall be replaced, retired, or repaired in
accordance with the following schedule:
o "Renovation" includes making and documenting software and hardware
changes, developing replacement systems, and decommissioning systems to be
retired. The Contractor-must complete renovation of affected software,
hardware and firmware by December 31, 1998.
o "Validation includes unit, integration, system, and end-to-end testing for
2000 compliance. The contractor must complete validation and testing of
converted or replaced systems into a production environment. The
Contractor must complete implementation by March 31, 1999.
o "Implementation includes acceptance testing and integration of converted
and replaced systems into a production environment. The contractor must
complete implementation by March 31, 1999.
(d) At a minimum, the contractor shall provide documentation, including project
plans and status reports, which demonstrate that the Contractor is meeting the
milestones listed above.
<PAGE> 110
<TABLE>
<S> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT 1. CONTRACT ID CODE PAGE OF PAGES
NAS3-98008 1 407
- ------------------------------------------------------------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO. 3. EFFECTIVE DATE 4. REQUISITION/PURCHASE REQ.NO. 5. PROJECT NO. (if applicable)
Modification Number Three (03) 7/23/99 NONE SETAR II
- ------------------------------------------------------------------------------------------------------------------------------------
6. ISSUED BY CODE 7830/Lupson 7. ADMINISTERED BY (IF OTHER THAN ITEM 6) CODE
------------ ------------
NASA Glenn Research Center
Services & Construction Branch (M.S. 500-312)
21000 Brookpark Road
Cleveland, OH 44135-3191
- ------------------------------------------------------------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State and Zip Code) |X| 9A. AMENDMENT OF SOLICITATION NO.
Dynacs Engineering Company Inc. ---------------------------------------------
2001 Aerospace Parkway 9B. DATED (SEE ITEM 11)
Brookpark, Ohio 44142
---------------------------------------------
10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS3-98008
---------------------------------------------
|X| 10B. DATED (SEE ITEM 13)
CODE FACILITY CODE 12/17/97
- ------------------------------------------------------------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- ------------------------------------------------------------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour and date specified for receipt of Offers |_| is
extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date specified in the solicitation or as amended, by one of
the following methods:
(a) By completing Items 8 and 15, and returning ___ copies of the amendment; (b) By acknowledging receipt of this amendment on each
copy of the offer submitted; or (c) By separate letter or telegram which includes a reference to the solicitation and amendment
numbers. FAILURE OF YOUR ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND DATE
SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this amendment you desire to change an offer already submitted,
such change may be made by telegram or letter, provided each telegram or letter makes reference to the solicitation and this
amendment, and is received prior to the opening hour and date specified.
- ------------------------------------------------------------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (if required)
N/A
- ------------------------------------------------------------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- ------------------------------------------------------------------------------------------------------------------------------------
|_| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE
CONTRACT ORDER NO. IN ITEM 10A.
- ------------------------------------------------------------------------------------------------------------------------------------
|_| B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (such as changes in paying
office, appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR 43.103(b).
- ------------------------------------------------------------------------------------------------------------------------------------
|X| C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
52.233-1 entitled "Disputes", 52.243-4 entitled "Changes" and mutual agreement
- ------------------------------------------------------------------------------------------------------------------------------------
|_| D. OTHER (Specify type of modification and authority)
- ------------------------------------------------------------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |_| is required to sign this document and return __ copies to the issuing office.
- ------------------------------------------------------------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings, including solicitation/contract subject matter
where feasible.)
(SEE ATTACHED PAGES)
- ------------------------------------------------------------------------------------------------------------------------------------
Except as provided herein, all terms and conditions of the document referenced in Item 9A or 10A, as heretofore changed, remains
unchanged and in full force and effect.
- ------------------------------------------------------------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print) 16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
[ILLEGIBLE] Thomas A. Spicer / Contracting Officer
- ------------------------------------------------------------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED 16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY Vice President & Program Manager 7/7/99 BY /s/ Thomas A. Spicer 7/23/99
---------------------------------------- ---------------------------------------
(Signature of person authorized to sign) (Signature of Contracting Officer)
- ------------------------------------------------------------------------------------------------------------------------------------
NSN 7540-01-152-807030-105 STANDARD FORM 30 (REV. 10-83)
PREVIOUS EDITION UNUSABLE Prescribed by GSA
FAR (48 CFR) 53.243
</TABLE>
<PAGE> 111
MODIFICATION NUMBER THREE (3) PAGE 2 OF 407
WHEREAS, The Government has directed and requested certain changes in the
contract, and the Contractor has submitted the appropriate proposals
for the additional Changes requested; and
WHEREAS, The Parties hereto have negotiated and agreed to an equitable
adjustment in the contract;
NOW THEREFORE, In consideration of the premises and of the obligations herein
set forth, the parties hereto do mutually agree as follows:
"In Section B of the contract, page B-2 is deleted in its entirety and the
attached Section B page B-2/Revised is substituted therefore and made a part
hereof;
In Section 6 of the contract, pages G-13 and G-14 are deleted in their entirety
and the attached Section 6 pages G-13/Revised and G-14/Revised is substituted
therefor. Pages G-19 through G-26 /Revised are hereby added to Section G and
include the contract clauses G.20 "Government Property (52.245-5)", G.21
"Financial Reporting Of NASA Property In The Custody Of
Contractors(1852.24.5-73)" and G.22 "List Of Government-Furnished
Property(1852.245-76)" and are made a part hereof;
In Section I of the Contract, pages 1-42 through I-50/Revised are hereby added
to Section I and include the contract clauses I-21 "Employment Reports On
Disabled Veterans and Veterans Of The Vietnam Era(52.222-37)" and I-22 "New
Technology (1852.227-70) and are made a part hereof;
In Section J of the Contract, Section J is deleted in it's entirety and the
Attached Section J Revised is substituted therefor and made a part hereof;"
The Period of Performance remains unchanged from June 1,1998 to August 31, 2000.
The Parties hereto acknowledge and agree that any and all claims for equitable
adjustment of the contract price and time pursuant to the provisions of the
clause(s) 52.243-04 entitled "CHANGES", and 52.233-01 entitled "DISPUTES" and
Mutual Agreement are hereby fully satisfied and discharged with respect to this
Supplemental Agreement Number Three (3).
[END OF MODIFICATION]
<PAGE> 112
SECTION B / REVISED
Contract Maximum: The Government issued Task Order(s) under this contract shall
not exceed a maximum of $66,797,004 (Cost=$64,795,583; Fee/Profit=$2,001,421)
for the 27 months of performance.
Task Order(s) shall be issued on either a Firm Fixed Price (FFP) basis or on a
Cost Reimbursable (CR) basis.
Ten percent of the technical hours (111,065 hours) have the potential of being
worked under fixed priced task order(s). The profit will be $2.34/technical hour
agreed to at task acceptance. The maximum total fixed fee for 27 months is
$259,892.
Ninety percent of the technical hours (999,582 hours) have the potential of
being worked under cost plus award fee task order(s).
The Award Fee periods, award fee per technical hour, and the maximum award fee
pool is as follows:
<TABLE>
<CAPTION>
Period Fee Per Tech. Hour Maximum Award Fee Pool
- ------ ------------------ ----------------------
<S> <C> <C> <C>
1 Jun 1/98-Feb 28/99 [ ] [ ]
2 Mar 1/99-Aug 31/99 [ * ] [ * ]
3 Sep 1/99-Feb 28/00 [ ] [ ]
4 Mar 1/00-Aug 31/00 [ ] [ ]
TOTAL
</TABLE>
(a) FIRM FIXED PRICE TASK ORDERS
Firm Fixed Price task order(s) shall be issued for work that can be well defined
and for which a fair and reasonable price can be obtained. The price is not
subject to any adjustment on the basis of contract cost experience.
(b) COST - REIMBURSEMENT TASK ORDERS
Work performed by the contractor shall be reimbursed based upon allowable costs
incurred, subject to negotiated limitations.
(c) AWARD FEE
Based upon the Contractor's overall performance, an award fee may be provided to
the Contractor. The amount of fee will be determined by the Government. The
award fee pool will be divided into two parts. The first part will consider the
contract administration and cost control. The second part will consider task
order performance.
(End Of Clause)
Page B-2 / Revised
* Confidential information has been omitted and filed separately with the
Commission.
<PAGE> 113
SECTION G / REVISED
(1) Final payment for Distributed Cost, including General and Administrative
(G&A) expenses will be based on the application of the actual audited rate, but
not in excess of the following ceilings:
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
RATE BASE TO WHICH RATE CFY 1998 CFY 1999
CATEGORY APPLIES JUNE 1 - DEC.31 JAN.1-JUNE 3O
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
SUPPORT TECHNICAL PRODUCTIVE
LABOR LABOR COST [ * ] [ * ]
- --------------------------------------------------------------------------------
LABOR TECHNICAL PRODUCTIVE
OVERHEAD LABOR COST [ * ] [ * ]
- --------------------------------------------------------------------------------
GENERAL & TOTAL ALLOWABLE
ADMINISTRATIVE EXCLUDING TASK DIRECT
EXPENSE [ * ] [ * ]
- --------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
RATE CATEGORY BASE TO WHICH RATE CFY 1999 CFY 2000
APPLIES JULY 1 - DEC.31 JAN. 1-AUG.31
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
DISTRIBUTED TECHNICAL PRODUCTIVE
COSTS LABOR COST [ * ] [ * ]
- --------------------------------------------------------------------------------
GENERAL & TOTAL ALLOWABLE
ADMINISTRATIVE EXCLUDING TASK DIRECT &
EXPENSE APPLICABLE. G&A* [ * ] [ * ]
- --------------------------------------------------------------------------------
</TABLE>
*Note: This 4% cap is included in the total ceiling rate of 75%
(2) Definitions:
"Distributed Costs" is the Support Labor, Labor Overhead, ODC's-Facilities,
Other ODC's and G&A.
(i) "Technical Productive Labor Cost" is the direct labor cost, without any
burdens, of ALL personnel charging directly to task orders, in accordance with
the contractors DCAA approved accounting system EXCLUDING the following
personnel and/or functions:
(A) Program Manager
(B) Department Directors
(C) Executive Secretary
(D) Support Overhead Labor
(ii) "Program Manager" is the individual who runs the Dynacs organization at
GRC. This person, regardless of title classification, would be responsible for
the directing and carrying on of Dynacs' business and/or affairs as they relate
to the overall performance of this contract.
(iii) "Department Directors" are those individuals who are one level below the
"Program Manager" and who are entrusted with the overall direction and operation
of the "technical departments" at GRC. The "technical departments" are
Aeromechanics, Aerospace Technology. Aeropropulsion Systems, and Space Sciences.
(iv)"Executive Secretary" is the individual(s) who to a substantial degree,
directly or indirectly, provides the "Program Manager" with secretarial support.
Page G-13 / Revised
* Confidential information has been omitted and filed separately with the
Commission.
<PAGE> 114
SECTION G / REVISED
(v) "Support Labor" labor in addition to labor defined in (ii), (iii) and (iv)
above, associated with the following administrative functions: Accounting,
Payroll, Human Resources, Contract Management, Purchasing, and Safety & Quality
Assurance.
(vi) "Direct Labor Cost" is that cost associated with any personnel who is not
in a paid absence status such as vacation, sick, or holiday leave AND which is
properly recorded and charged to the contract as Direct Labor Cost in accordance
with both written company policy AND the contractor's DCAA approved accounting
system.
(vii) "Task Direct Charges" is that cost which is directly chargeable to a task
order such as, but not limited to, travel and training directly related to a
specific task AND any equipment and material directly related to, and/or
necessary for, the performance of a specific task.
(viii) "Labor Overhead" is the cost associated with employee absences, taxes,
and benefits. Specific cost elements include but is not limited to: vacation,
sick, administrative leave, FICA, FUTA, SUTA, workers compensation, employee
morale and welfare, 401-(k), medical coverage, and long-term disability
coverage.
(ix) "G&A" is the Home Office residual costs allocated in accordance with CAS
403.
(x) "Distributed Costs" are ALL CONTRACT DIRECT AND INDIRECT costs other than
those costs specifically identified as "Technical Productive Labor Costs," "Task
Direct Charges," and "Award Fee." "Distributed Costs" include cost elements such
as: Labor Overhead, Facilities, Support Labor, Other Support and G&A.
(3) Exceptions:
(i) Increased Distributed Costs during the term of this contract that
result from such items as statute, court decision or written rulings
or regulations by the Internal Revenue Service or other taxing
authority may be cause for adjustment of the distributed rate.
(ii) Notwithstanding the above paragraph, in the event that the actual
distributed rate exceeds the ceiling rate; all costs in excess of
the ceiling rate are not reimbursable under this contract.
(iii) The Contractor shall advise the Contracting Officer of any planned
or approved accounting changes that would impact the subject rates
and demonstrate how the changes will impact the negotiated ceilings.
Page G-14 / Revised
<PAGE> 115
SECTION G / REVISED
GOVERNMENT PROPERTY CLAUSES FAR/NASA-FAR
G.20 GOVERNMENT PROPERTY(Cost-Reimbursement, Time-and-Material, or Labor-Hour
Contracts). (Jan 1986) 52.245-5
(a) Government-furnished property.
(1) The term "Contractor's managerial personnel," as used in paragraph (g) of
this clause, means any of the Contractor's directors, officers, managers,
superintendents, or equivalent representatives who have supervision or direction
of--
(i) All or substantially all of the Contractor's business;
(ii) All or substantially all of the Contractor's operation at any one plant, or
separate location at which the contract is being performed; or
(iii) A separate and complete major industrial operation connected with
performing this contract.
(2) The Government shall deliver to the Contractor, for use in connection with
and under the terms of this contract, the Government-furnished property
described in the Schedule or specifications, together with such related data and
information as the Contractor may request and as may be reasonably required for
the intended use of the property (hereinafter referred to as
"Government-Furnished Property").
(3) The delivery or performance dates for this contract are based upon the
expectation that Government-furnished property suitable for use will be
delivered to the Contractor at the times stated in the Schedule or, if not so
stated, in sufficient time to enable the Contractor to meet the contract's
delivery or performance dates.
(4) If Government-furnished property is received by the Contractor in a
condition not suitable for the intended use, the Contractor shall, upon receipt,
notify the Contracting Officer, detailing the facts, and, as directed by the
Contracting Officer and at Government expense, either effect repairs or
modification or return or otherwise dispose of the property. After completing
the directed action and upon written request of the Contractor, the Contracting
Officer shall make an equitable adjustment as provided in paragraph (h) of this
clause.
(5) If Government-furnished property is not delivered to the Contractor by the
required time or times, the Contracting Officer shall, upon the Contractor's
timely written request,
Page G-19 / Revised
<PAGE> 116
SECTION G / REVISED
make a determination of the delay, if any, caused the Contractor and shall make
an equitable adjustment in accordance with paragraph (h) of this clause.
(b) Changes in Government-furnished property. (1) The Contracting Officer may,
by written notice, (i) decrease the Government-furnished property provided or to
be provided under this contract or (ii) substitute other Government-furnished
property for the property to be provided by the Government or to be acquired by
the Contractor for the Government under this contract. The Contractor shall
promptly take such action as the Contracting Officer may direct regarding the
removal, shipment, or disposal of the property covered by this notice.
(2) Upon the Contractor's written request, the Contracting Officer shall make an
equitable adjustment to the contact in accordance with paragraph (h) of this
clause, if the Government has agreed in the Schedule to make such property
available for performing this contract and there is any--
(i) Decrease or substitution in this property pursuant to subparagraph (b)(1)
above; or
(ii) Withdrawal of authority to use property, if provided under any other
contract or lease. (c) Title. (1) The Government shall retain title to all
Government-furnished property.
(2) Title to all property purchased by the Contractor for which the Contractor
is entitled to be reimbursed as a direct item of cost under this contract shall
pass to and vest in the Government upon the vendor's delivery of such property.
(3) Title to all other property, the cost of which is reimbursable to the
Contractor, shall pass to and vest in the Government upon--
(i) Issuance of the property for use in contract performance;
(ii) Commencement of processing of the property for use in contract performance;
or
(iii) Reimbursement of the cost of the property by the Government, whichever
occurs first.
(4) All Government-furnished property and all property acquired by the
Contractor, title to which vests in the Government under this paragraph
(collectively referred to as "Government property"), are subject to the
provisions of this clause. Title to Government property shall not be affected by
its incorporation into or attachment to any property not owned by the
Government, nor shall Government property become a fixture or lose its identity
as personal property by being attached to any real property.
Page G-20 / Revised
<PAGE> 117
SECTION G / REVISED
(d) Use of Government property. The Government property shall be used only for
performing this contract, unless otherwise provided in this contract or approved
by the Contracting Officer.
(e) Property administration. (1) The Contractor shall be responsible and
accountable for all Government property provided under the contract and shall
comply with Federal Acquisition Regulation (FAR) Subpart 45.5, as in effect on
the date of this contract.
(2) The Contractor shall establish and maintain a program for the use,
maintenance, repair, protection, and preservation of Government property in
accordance with sound business practice and the applicable provisions of FAR
Subpart 45.5.
(3) If damage occurs to Government property, the risk of which has been assumed
by the Government under this contract, the Government shall replace the items or
the Contractor shall make such repairs as the Government directs. However, if
the Contractor cannot effect such repairs within the time required, the
Contractor shall dispose of the property as directed by the Contracting Officer.
When any property for which the Government is responsible is replaced or
repaired, the Contracting Officer shall make an equitable adjustment in
accordance with paragraph (h) of this clause.
(f) Access. The Government and all its designees shall have access at all
reasonable times to the premises in which any Government property is located for
the purpose of inspecting the Government property.
(g) Limited risk of loss. (1) The Contractor shall not be liable for loss or
destruction of, or damage to, the Government property provided under this
contract or for expenses incidental to such loss, destruction, or damage, except
as provided in subparagraphs (2) and (3) below.
(2) The Contractor shall be responsible for loss or destruction of, or damage
to, the Government property provided under this contract (including expenses
incidental to such loss, destruction, or damage)--
(i) That results from a risk expressly required to be insured under this
contract, but only to the extent of the insurance required to be purchased and
maintained or to the extent of insurance actually purchased and maintained,
whichever is greater;
(ii) That results from a risk that is in fact covered by insurance or for which
the Contractor is otherwise reimbursed, but only to the extent of such insurance
or reimbursement;
(iii) For which the Contractor is otherwise responsible under the express terms
of this contract;
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SECTION G / REVISED
(iv) That results from willful misconduct or lack of good faith on the part of
the Contractor's managerial personnel; or
(v) That results from a failure on the part of the Contractor, due to willful
misconduct or lack of good faith on the part of the Contractor's managerial
personnel, to establish and administer a program or system for the control, use,
protection, preservation, maintenance, and repair of Government property as
required by paragraph (e) of this clause.
(3)(i) If the Contractor fails to act as provided by subdivision (g)(2)(v)
above, after being notified (by certified mail addressed to one of the
Contractor's managerial personnel) of the Government's disapproval, withdrawal
of approval, or nonacceptance of the system or program, it shall be conclusively
presumed that such failure was due to willful misconduct or lack of good faith
on the part of the Contractor's managerial personnel.
(ii) In such event, any loss or destruction of, or damage to, the Government
property shall be presumed to have resulted from such failure unless the
Contractor can establish by clear and convincing evidence that such loss,
destruction, or damage--
(A) Did not result from the Contractor's failure to maintain an approved program
or system; or
(B) Occurred while an approved program or system was maintained by the
Contractor.
(4) If the Contractor transfers Government property to the possession and
control of a subcontractor, the transfer shall not affect the liability of the
Contractor for loss or destruction of, or damage to, the property as set forth
above. However, the Contractor shall require the subcontractor to assume the
risk of, and be responsible for, any loss or destruction of, or damage to, the
property while in the subcontractor's possession or control, except to the
extent that the subcontract, with the advance approval of the Contracting
Officer, relieves the subcontractor from such liability. In the absence of such
approval, the subcontract shall contain appropriate provisions requiring the
return of all Government property in as good condition as when received, except
for reasonable wear and tear or for its use in accordance with the provisions of
the prime contract.
(5) Upon loss or destruction of, or damage to, Government property provided
under this contract, the Contractor shall so notify the Contracting Officer and
shall communicate with the loss and salvage organization, if any, designated by
the Contracting Officer. With the assistance of any such organization, the
Contractor shall take all reasonable action to protect the Government property
from further damage, separate the damaged and undamaged Government property, put
all the affected Government property in the best possible order, and furnish to
the Contracting Officer a statement of--
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SECTION G / REVISED
(i) The lost, destroyed, or damaged Government property;
(ii) The time and origin of the loss, destruction, or damage;
(iii) All known interests in commingled property of which the Government
property is a part; and
(iv) The insurance, if any, covering any paRT of or interest in such commingled
property.
(6) The Contractor shall repair, renovate, and take such other action with
respect to damaged Government property as the Contracting Officer directs. If
the Government property is destroyed or damaged beyond practical repair, or is
damaged and so commingled or combined with property of others (including the
Contractor's) that separation is impractical, the Contractor may, with the
approval of and subject to any conditions imposed by the Contracting Officer,
sell such property for the account of the Government. Such sales may be made in
order to minimize the loss to the Government, to permit the resumption of
business, or to accomplish a similar purpose. The Contractor shall be entitled
to an equitable adjustment in the contract price for the expenditures made in
performing the obligations under this subparagraph (g)(6) in accordance with
paragraph (h) of this clause. However, the Government may directly reimburse the
loss and salvage organization for any of their charges. The Contracting Officer
shall give due regard to the Contractor's liability under this paragraph (g)
when making any such equitable adjustment.
(7) The Contractor shall not be reimbursed for, and shall not include as an item
of overhead, the cost of insurance or of any reserve covering risk of loss or
destruction of or damage to, Government property, except to the extent that the
Government may have expressly required the Contractor to carry such insurance
under another provision of this contract.
(8) In the event the Contractor is reimbursed or otherwise compensated for any
loss or destruction of, or damage to, Government property, the Contractor shall
use the proceeds to repair, renovate, or replace the lost, destroyed, or damaged
Government property or shall otherwise credit the proceeds to, or equitably
reimburse, the Government, as directed by the Contracting Officer.
(9) The Contractor shall do nothing to prejudice the Government's rights to
recover against third parties for any loss or destruction of, or damage to,
Government property. Upon the request of the Contracting Officer, the Contractor
shall, at the Government's expense, furnish to the Government all reasonable
assistance and cooperation (including the prosecution of suit and the execution
of instruments of assignment in favor of the Government) in obtaining recovery.
In addition, where a subcontractor has not been relieved from liability for any
loss or destruction of, or damage to, Government property,
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SECTION G / REVISED
the Contractor shall enforce for the benefit of the Government the liability of
the subcontractor for such loss, destruction, or damage.
(h) Equitable adjustment. When this clause specifies an equitable adjustment, it
shall be made to any affected contract provision in accordance with the
procedures of the Changes clause. When appropriate, the Contracting Officer may
initiate an equitable adjustment in favor of the Government. The right to an
equitable adjustment shall be the Contractor's exclusive remedy. the Government
shall not be liable to suit for breach of contract for--
(1) Any delay in delivery of Government-furnished property;
(2) Delivery of Government-furnished property in a condition not suitable for
its intended use;
(3) A decrease in or substitution of Government-furnished property; or
(4) Failure to repair or replace Government property for which the Government is
responsible.
(i) Final accounting and disposition of Government property. Upon completing
this contract, or at such earlier dates as may be fixed by the Contracting
Officer, the Contractor shall submit, in a form acceptable to the Contracting
Officer, inventory schedules covering all items of Government property not
consumed in performing this contract or delivered to the Government. The
Contractor shall prepare for shipment, deliver f.o.b. origin, or dispose of the
Government property as may be directed or authorized by the Contracting Officer.
The net proceeds of any such disposal shall be credited to the cost of the work
covered by this contract or paid to the Government as directed by the
Contracting Officer. The foregoing provisions shall apply to scrap from
Government property; provided, however, that the Contracting Officer may
authorize or direct the Contractor to omit from such inventory schedules any
scrap consisting of faulty castings or forgings or of cutting and processing
waste, such as chips, cuttings, borings, turnings, short ends, circles,
trimmings, clippings, and remnants, and to dispose of such scrap in accordance
with the Contractor's normal practice and account for it as a part of general
overhead or other reimbursable costs in accordance with the Contractor's
established accounting procedures.
(j) Abandonment and restoration of Contractor premises. Unless otherwise
provided herein, the Government--
(1) May abandon any Government property in place, at which time all obligations
of the Government regarding such abandoned property shall cease; and
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SECTION G / REVISED
(2) Has no obligation to restore or rehabilitate the Contractor's premises under
any circumstances (e.g., abandonment, disposition upon completion of need, or
contract completion). However, if the Government-furnished property (listed in
the Schedule or specifications) is withdrawn or is unsuitable for the intended
use, or if other Government property is substituted, then the equitable
adjustment under paragraph (h) of this clause may properly include restoration
or rehabilitation costs.
(k) Communications. All communications under this clause shall be in writing.
(l) Overseas contracts. If this contract is to be performed outside the United
States of America, its territories, or possessions, the words "Government" and
"Government-furnished" (wherever they appear in this clause) shall be construed
as "United States Government" and "United States Government-furnished,"
respectively.
(End of clause)
G.21 FINANCIAL REPORTING OF NASA PROPERTY IN THE CUSTODY OF CONTRACTORS
(SEPTEMBER 1996) 1852.245-73
(a) The Contractor shall submit annually a NASA Form (NF) 1018, NASA Property in
the Custody of Contractors, in accordance with 1845.505-14, the instructions on
the form, and subpart 1845.71. Subcontractor use of NF 1018 is not required by
this clause; however, the contractor shall include data on property in the
possession of subcontractors in the annual NF-1018.
(b) If administration of this contract has been delegated to the Department of
Defense, the original of NASA Form 1018 shall be submitted to the NASA
installation Financial Management Officer and three copies shall be sent
concurrently through the DOD Property Administrator to the NASA office
identified below. If the contract is administered by NASA, the original of NF -
1018 shall be submitted to the installation Financial Management Officer, and
three copies shall be sent concurrently to the following NASA office:
NASA GLENN RESEARCH CENTER
INDUSTRIAL PROPERTY OFFICE
M.S. 21-6
(c) The annual reporting period shall be from October 1 of each year through
September 30 of the following year. The report shall be submitted in time to be
received by October 31. The information contained in these reports is entered
into the NASA accounting system to reflect current asset values for agency
financial statement purposes. Therefore, it is essential that required reports
be received no later than October 31. The Contracting Officer may, in the
Government's interest, withhold payment until
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SECTION G / REVISED
a reserve not exceeding $25,000 or 5 percent of the amount of the contract,
whichever is less, has been set aside, if the Contractor fails to submit annual
NF 1018 reports when due, Such reserve shall be withheld until the Contracting
Officer has determined that the required reports have been received by the
Government. The withholding of any amount or the subsequent payment thereof
shall not be construed as a waiver of any Government right.
(d) A final report is required within 30 days after disposition of all property
subject to reporting when the contract performance period is complete.
(End of clause)
G.22 LIST OF GOVERNMENT-FURNISHED PROPERTY (OCTOBER 1988) 1852.245-76
For performance of work under this contract, the Government will make available
Government property identified below or in Attachment A of this contract on a
no-charge-for-use basis. The Contractor shall use this property in the
performance of this contract at the 2K1 Building and at other location(s) as may
be approved by the Contracting Officer. Under the FAR 52.245 Government
property clause of this contract, the Contractor is accountable for the
identified property.
See Attachment A for Item, Quantity, Acquisition Cost, and Date to be Furnished
to the Contractor.
(End of clause)
[REVISED END OF SECTION]
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SECTION I / REVISED
I.21 Employment Reports on Disabled Veterans and Veterans of the Vietnam Era.
52.222-37
Employment Reports on Disabled Veterans and Veterans of the Vietnam Era (Jan
1999)
(a) Unless the Contractor is a State or local government agency, the Contractor
shall report at least annually, as required by the Secretary of Labor, on--
(1) The number of disabled veterans and the number of veterans of the Vietnam
era in the workforce of the contractor by job category and hiring location; and
(2) The total number of new employees hired during the period covered by the
report, and of that total, the number of disabled veterans, and the number of
veterans of the Vietnam era.
(b) The above items shall be reported by completing the form entitled "Federal
Contractor Veterans' Employment Report VETS-l00."
(c) Reports shall be submitted no later than September 30 of each year beginning
September 30, 1988.
(d) The employment activity report required by paragraph (a)(2) of this clause
shall reflect total hires during the most recent 12-month period as of the
ending date selected for the employment profile report required by paragraph
(a)(1) of this clause. Contractors may select an ending date:
(1) As of the end of any pay period during the period January through March 1st
of the year the report is due, or
(2) As of December 31, if the contractor has previous written approval from the
Equal Employment Opportunity Commission to do so for purposes of submitting the
Employer Information Report EEO-1 (Standard Form 100).
(e) The count of veterans reported according to paragraph (a) of this clause
shall be based on voluntary disclosure. Each Contractor subject to the reporting
requirements at 38 U.S.C. 4212 shall invite all disabled veterans and veterans
of the Vietnam era who wish to benefit under the affirmative action program at
38 U.S.C. 4212 to identify themselves to the Contractor. The invitation shall
state that the information is voluntarily provided; that the information will be
kept confidential; that disclosure or refusal to provide the information will
not subject the applicant or employee to any adverse treatment; and that the
information will be used only in accordance with the regulations promulgated
under 38 U.S.C. 4212.
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SECTION I / REVISED
(f) Subcontracts. The Contractor shall include the terms of this clause in every
subcontract or purchase order of $10,000 or more unless exempted by rules,
regulations, or orders of the Secretary.
(End of clause)
1.22 NEW TECHNOLOGY (NOVEMBER 1998) 1852.227-70
(a) Definitions.
"Administrator," as used in this clause, means the Administrator of the National
Aeronautics and Space Administration (NASA) or duly authorized representative.
"Contract," as used in this clause, means any actual or proposed contract,
agreement, understanding, or other arrangement, and includes any assignment,
substitution of parties, or subcontract executed or entered into thereunder.
"Made," as used in this clause, means conception or first actual reduction to
practice; provided, that in the case of a variety of plant, the date of
determination (as defined in Section 4 1(d) of the Plant Variety Protection Act,
7 U.S.C. 240 1(d)) must also occur during the period of contract performance.
"Nonprofit organization," as used in this clause, means a domestic university or
other institution of higher education or an organization of the type described
in section 501(c)(3) of the Internal Revenue Code of 1954 (26 U.S.C. 501(c)) and
exempt from taxation under section 501(a) of the Internal Revenue Code (26
U.S.C. 501(a)), or any domestic nonprofit scientific or educational organization
qualified under a State nonprofit organization statute.
"Practical application," as used in this clause, means to manufacture, in the
case of a composition or product; to practice, in the case of a process or
method; or to operate, in case of a machine or system; and, in each case, under
such conditions as to establish that the invention is being utilized and that
its benefits are, to the extent permitted by law or Government regulations,
available to the public on reasonable terms.
"Reportable item," as used in this clause, means any invention, discovery,
improvement, or innovation of the contractor, whether or not patentable or
otherwise protectible under Title 35 of the United States Code, made in the
performance of any work under any NASA contract or in the performance of any
work that is reimbursable under any clause
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SECTION I / REVISED
in any NASA contract providing for reimbursement of costs incurred before the
effective date of the contract. Reportable items include, but are not limited
to, new processes, machines, manufactures, and compositions of matter, and
improvements to, or new applications of, existing processes, machines,
manufactures, and compositions of matter. Reportable items also include new
computer programs, and improvements to, or new applications of, existing
computer programs, whether or not copyrightable or otherwise protectible under
Title 17 of the United States Code.
"Small business firm," as used in this clause, means a domestic small business
concern as defined at 15 U.S.C. 632 and implementing regulations of the
Administrator of the Small Business Administration. (For the purpose of this
definition, the size standard contained in 13 CFR 121.3-8 for small business
contractors and in 13 CFR 121.3-12 for small business subcontractors will be
used.)
"Subject invention," as used in this clause, means any reportable item which is
or may be patentable or otherwise protectible under Title 35 of the United
States Code, or any novel variety of plant that is or may be protectible under
the Plant Variety Protection Act (7 U.S.C. 2321, et seq.).
(b) Allocation of principal rights.
(1) Presumption of title.
(i) Any reportable item that the Administrator considers to be a subject
invention shall be presumed to have been made in the manner specified in
paragraph (1) or (2) of Section 305(a) of the National Aeronautics and Space Act
of 1958 (42 U.S.C. 2457(a)) (hereinafter called "the Act"), and the above
presumption shall be conclusive unless at the time of reporting the reportable
item the Contractor submits to the Contracting Officer a written statement,
containing supporting details, demonstrating that the reportable item was not
made in the manner specified in paragraph (1) or (2) of Section 305(a) of the
Act.
(ii) Regardless of whether title to a given subject invention would otherwise be
subject to an advance waiver or is the subject of a petition for waiver, the
Contractor may nevertheless file the statement described in paragraph (b)(1)(i)
of this clause. The Administrator will review the information furnished by the
Contractor in any such statement and any other available information relating to
the circumstances surrounding the making of the subject invention and will
notify the Contractor whether the Administrator has determined that the subject
invention was made in the manner specified in paragraph (1) or (2) of Section
305(a) of the Act.
(2) Property rights in subject inventions. Each subject invention for which the
presumption of paragraph (b)(1)(i) of this clause is conclusive or for which
there has been
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SECTION I / REVISED
a determination that it was made in the manner specified in paragraph (1) or (2)
of Section 305(a) of the Act shall be the exclusive property of the United
States as represented by NASA unless the Administrator waives all or any part of
the rights of the United States, as provided in paragraph (b)(3) of this clause.
(3) Waiver of rights.
(i) Section 305(f) of the Act provides for the promulgation of regulations by
which the Administrator may waive the rights of the United States with respect
to any invention or class of inventions made or that may be made under
conditions specified in paragraph (1) or (2) of Section 305(a) of the Act. The
promulgated NASA Patent Waiver Regulations, 14 CFR Section 1245, Subpart 1, have
adopted the Presidential Memorandum on Government Patent Policy of February 18,
1983, as a guide in acting on petitions (requests) for such waiver of rights.
(ii) As provided in 14 CFR 1245, Subpart 1, Contractors may petition, either
prior to execution of the contract or within 30 days after execution of the
contract, for advance waiver of rights to any or all of the inventions that may
be made under a contract. If such a petition is not submitted, or if after
submission it is denied, the Contractor (or an employee inventor of the
Contractor) may petition for waiver of rights to an identified subject invention
within eight months of first disclosure of invention in accordance with
paragraph (e)(2) of this clause, or within such longer period as may be
authorized in accordance with 14 CFR 1245.105.
(c) Minimum rights reserved by the Government.
(1) With respect to each subject invention for which a waiver of rights is
applicable in accordance with 14 CFR Section 1245, Subpart 1, the Government
reserves--
(i) An irrevocable, nonexclusive, nontransferable, royalty-free license for the
practice of such invention throughout the world by or on behalf of the United
States or any foreign government in accordance with any treaty or agreement with
the United States; and
(ii) Such other rights as stated in 14 CFR 1245.107.
(2) Nothing contained in this paragraph (c) shall be considered to grant to the
Government any rights with respect to any invention other than a subject
invention.
(d) Minimum rights to the Contractor.
(1) The Contractor is hereby granted a revocable, nonexclusive, royalty-free
license in each patent application filed in any country on a subject invention
and any resulting patent in which the Government acquires title, unless the
Contractor fails to disclose the subject invention within the times specified in
paragraph (e)(2) of this clause.
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SECTION I / REVISED
The Contractor's license extends to its domestic subsidiaries and affiliates, if
any, within the corporate structure of which the Contractor is a party and
includes the right to grant sublicenses of the same scope to the extent the
Contractor was legally obligated to do so at the time the contract was awarded.
The license is transferable only with the approval of the Administrator except
when transferred to the successor of that part of the Contractor's business to
which the invention pertains.
(2) The Contractor's domestic license may be revoked or modified by the
Administrator to the extent necessary to achieve expeditious practical
application of the subject invention pursuant to an application for an exclusive
license submitted in accordance with 37 CFR Part 404, Licensing of Government
Owned Inventions. This license will not be revoked in that field of use or the
geographical areas in which the Contractor has achieved practical application
and continues to make the benefits of the invention reasonably accessible to the
public. The license in any foreign country may be revoked or modified at the
discretion of the Administrator to the extent the Contractor, its licensees, or
its domestic subsidiaries or affiliates have failed to achieve practical
application in that foreign country.
(3) Before revocation or modification of the license, the Contractor will be
provided a written notice of the Administrator's intention to revoke or modify
the license, and the Contractor will be allowed 30 days (or such other time as
may be authorized by the Administrator for good cause shown by the Contractor)
after the notice to show cause why the license should not be revoked or
modified. The Contractor has the right to appeal to the Administrator any
decision concerning the revocation or modification of its license.
(e) Invention identification, disclosures, and reports.
(1) The Contractor shall establish and maintain active and effective procedures
to assure that reportable items are promptly identified and disclosed to
Contractor personnel responsible for the administration of this New Technology
clause within six months of conception and/or first actual reduction to
practice, whichever occurs first in the performance of work under this contract.
These procedures shall include the maintenance of laboratory notebooks or
equivalent records and other records as are reasonably necessary to document the
conception and/or the first actual reduction to practice of the reportable
items, and records that show that the procedures for identifying and disclosing
reportable items are followed. Upon request, the Contractor shall furnish the
Contracting Officer a description of such procedures for evaluation and for
determination as to their effectiveness.
(2) The Contractor will disclose each reportable item to the Contracting Officer
within two months after the inventor discloses it in writing to Contractor
personnel responsible for the administration of this New Technology clause or,
if earlier, within six
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SECTION I / REVISED
months after the Contractor becomes aware that a reportable item has been made,
but in any event for subject inventions before any on sale, public use, or
publication of such invention known to the Contractor. The disclosure to the
agency shall be in the form of a written report and shall identify the contract
under which the reportable item was made and the inventor(s) or innovator(s). It
shall be sufficiently complete in technical detail to convey a clear
understanding, to the extent known at the time of the disclosure, of the nature,
purpose, operation, and physical, chemical, biological, or electrical
characteristics of the reportable item. The disclosure shall also identify any
publication, on sale, or public use of any subject invention and whether a
manuscript describing such invention has been submitted for publication and, if
so, whether it has been accepted for publication at the time of disclosure. In
addition, after disclosure to the agency, the Contractor will promptly notify
the agency of the acceptance of any manuscript describing a subject invention
for publication or of any on sale or public use planned by the Contractor for
such invention.
(3) The Contractor shall furnish the Contracting Officer the following:
(i) Interim reports every 12 months (or such longer period as may be specified
by the Contracting Officer) from the date of the contract, listing reportable
items during that period, and certifying that all reportable items have been
disclosed (or that there are no such inventions) and that the procedures
required by paragraph (e)(l) of this clause have been followed.
(ii) A final report, within 3 months after completion of the contracted work,
listing all reportable items or certifying that there were no such reportable
items, and listing all subcontracts at any tier containing a patent rights
clause or certifying that there were no such subcontracts.
(4) The Contractor agrees, upon written request of the Contracting Officer, to
furnish additional technical and other information available to the Contractor
as is necessary for the preparation of a patent application on a subject
invention and for the prosecution of the patent application, and to execute all
papers necessary to file patent applications on subject inventions and to
establish the Government's rights in the subject inventions.
(5) The Contractor agrees, subject to paragraph 27.302(i), of the Federal
Acquisition Regulation (FAR), that the Government may duplicate and disclose
subject invention disclosures and all other reports and papers furnished or
required to be furnished pursuant to this clause.
(f) Examination of records relating to inventions.
Page I-47 / Revised
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SECTION I / REVISED
(1) The Contracting Officer or any authorized representative shall, until 3
years after final payment under this contract, have the right to examine any
books (including laboratory notebooks), records, and documents of the Contractor
relating to the conception or first actual reduction to practice of inventions
in the same field of technology as the work under this contract to determine
whether--
(i) Any such inventions are subject inventions;
(ii) The Contractor has established and maintained the procedures required by
paragraph (e)(1) of this clause; and
(iii) The Contractor and its inventors have complied with the procedures.
(2) If the Contracting Officer learns of an unreported Contractor invention that
the Contracting Officer believes may be a subject invention, the Contractor may
be required to disclose the invention to the agency for a determination of
ownership rights.
(3) Any examination of records under this paragraph will be subject to
appropriate conditions to protect the confidentiality of the information
involved.
(g) Withholding of payment (this paragraph does not apply to subcontracts).
(1) Any time before final payment under this contract, the Contracting Officer
may, in the Government's interest, withhold payment until a reserve not
exceeding $50,000 or 5 percent of the amount of this contract, whichever is
less, shall have been set aside if, in the Contracting Officer's opinion, the
Contractor fails to--
(i) Establish, maintain, and follow effective procedures for identifying and
disclosing reportable items pursuant to paragraph (e)(1) of this clause;
(ii) Disclose any reportable items pursuant to paragraph (e)(2) of this clause;
(iii) Deliver acceptable interim reports pursuant to paragraph (e)(3)(i) of this
clause; or
(iv) Provide the information regarding subcontracts pursuant to paragraph (h)(4)
of this clause.
(2) Such reserve or balance shall be withheld until the Contracting Officer has
determined that the Contractor has rectified whatever deficiencies exist and has
delivered all reports, disclosures, and other information required by this
clause.
(3) Final payment under this contract shall not be made before the Contractor
delivers to
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SECTION I / REVISED
the Contracting Officer all disclosures of reportable items required by
paragraph (e)(2) of this clause, and an acceptable final report pursuant to
paragraph (e)(3)(ii) of this clause.
(4) The Contracting Officer may decrease or increase the sums withheld up to the
maximum authorized above. No amount shall be withheld under this paragraph while
the amount specified by this paragraph is being withheld under other provisions
of the contract. The withholding of any amount or the subsequent payment thereof
shall not be construed as a waiver of any Government rights.
(h) Subcontracts.
(1) Unless otherwise authorized or directed by the Contracting Officer, the
Contractor shall--
(i) Include this clause (suitably modified to identify the parties) in any
subcontract hereunder (regardless of tier) with other than a small business firm
or nonprofit organization for the performance of experimental, developmental, or
research work; and
(ii) Include the clause at FAR 52.227-11 (suitably modified to identify the
parties) in any subcontract hereunder (regardless of tier) with a small business
firm or nonprofit organization for the performance of experimental,
developmental, or research work.
(2) In the event of a refusal by a prospective subcontractor to accept such a
clause the Contractor--
(i) Shall promptly submit a written notice to the Contracting Officer setting
forth the subcontractor's reasons for such refusal and other pertinent
information that may expedite disposition of the matter; and
(ii) Shall not proceed with such subcontract without the written authorization
of the Contracting Officer.
(3) In the case of subcontracts at any tier, the agency, subcontractor, and
Contractor agree that the mutual obligations of the parties created by this
clause constitute a contract between the subcontractor and NASA with respect to
those matters covered by this clause.
(4) The Contractor shall promptly notify the Contracting Officer in writing upon
the award of any subcontract at any tier containing a patent rights clause by
identifying the subcontractor, the applicable patent rights clause, the work to
be performed under the subcontract, and the dates of award and estimated
completion. Upon request of the Contracting Officer, the Contractor shall
furnish a copy of such subcontract, and, no more frequently than annually, a
listing of the subcontracts that have been awarded.
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SECTION I / REVISED
(5) The subcontractor will retain all rights provided for the Contractor in the
clause of subparagraph (h)(1)(i) or (ii) of this clause, whichever is included
in the subcontract, and the Contractor will not, as part of the consideration
for awarding the subcontract, obtain rights in the subcontractor's subject
inventions.
(i) Preference for United States industry. Unless provided otherwise, no
Contractor that receives title to any subject invention and no assignee of any
such Contractor shall grant to any person the exclusive right to use or sell any
subject invention in the United States unless such person agrees that any
products embodying the subject invention will be manufactured substantially in
the United States. However, in individual cases, the requirement may be waived
by the Administrator upon a showing by the Contractor or assignee that
reasonable but unsuccessful efforts have been made to grant licenses on similar
terms to potential licensees that would be likely to manufacture substantially
in the United States or that under the circumstances domestic manufacture is not
commercially feasible.
(end of clause)
Page I-50 / Revised
<PAGE> 132
SECTION J / REVISED
PART III - LIST OF DOCUMENTS, EXHIBITS
AND OTHER ATTACHMENTS
--------------------------------------
SECTION J - LIST OF ATTACHMENTS
--------------------------------------
NO.
ATTACHMENT TITLE DATE PAGES
- ---------- ------------------------------- ---------
A. LIST OF INSTALLATION - PROVIDED 01/JUL/99 197
GOVERNMENT PROPERTY
B. LIST OF INSTALLATION - PROVIDED 01/JUL/99 186
GOVERNMENT PROPERTY ASSIGNED
TO DYNACS EMPLOYEES ON SITE
Page J-1 / Revised
<PAGE> 133
<TABLE>
<S> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT 1. CONTRACT ID CODE 1 of 2
- ------------------------------------------------------------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO. 3. EFFECTIVE DATE 4. REQUISITION/PURCHASE REQ.NO. 5. PROJECT NO. (if applicable)
2 May 20, 1999
- ------------------------------------------------------------------------------------------------------------------------------------
6. ISSUED BY CODE 0616/TAS 7. ADMINISTERED BY (IF OTHER THAN ITEM 6) CODE
------------ ------------
NASA Glenn Research Center
Attn: Thomas A Spicer
Services and Construction Branch
21000 Brookpark Road, Mail Stop 500-312
Cleveland, OH 44135-3191
- ------------------------------------------------------------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State and Zip Code) |_| 9A. AMENDMENT OF SOLICITATION NO.
DYNACS ENGINEERING COMPANY INC. ---------------------------------------------
2001 Aerospace Parkway 9B. DATED (SEE ITEM 11)
Brookpark, Ohio 44142
---------------------------------------------
|X| 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS3-98008
---------------------------------------------
- ---------------------------------------------------------------------------------- 10B. DATED (SEE ITEM 13)
CODE (PF)(9) FACILITY CODE 12-17-97
- ------------------------------------------------------------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- ------------------------------------------------------------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour and date specified for receipt of Offers |_| is
extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date specified in the solicitation or as amended, by one of
the following methods:
(a) By completing Items 8 and 15, and returning ___ copies of the amendment; (b) By acknowledging receipt of this amendment on each
copy of the offer submitted; or (c) By separate letter or telegram which includes a reference to the solicitation and amendment
numbers. FAILURE OF YOUR ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND DATE
SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this amendment you desire to change an offer already submitted,
such change may be made by telegram or letter, provided each telegram or letter makes reference to the solicitation and this
amendment, and is received prior to the opening hour and date specified.
- ------------------------------------------------------------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (if required)
N/A
- ------------------------------------------------------------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- ------------------------------------------------------------------------------------------------------------------------------------
|_| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE
CONTRACT ORDER NO. IN ITEM 10A.
- ------------------------------------------------------------------------------------------------------------------------------------
|_| B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (such as changes in paying
office, appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR 43.103(b).
- ------------------------------------------------------------------------------------------------------------------------------------
|_| C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- ------------------------------------------------------------------------------------------------------------------------------------
|X| D. OTHER (Specify type of modification and authority)
B.4 Award Fee Pool (SEPT 97)
- ------------------------------------------------------------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document and return __ copies to the issuing office.
- ------------------------------------------------------------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings, including solicitation/contract subject matter
where feasible.)
See Page 2
- ------------------------------------------------------------------------------------------------------------------------------------
Except as provided herein, all terms and conditions of the document referenced in Item 9A or 10A, as heretofore changed, remains
unchanged and in full force and effect.
- ------------------------------------------------------------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print) 16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Thomas A. Spicer, Contracting Officer
- ------------------------------------------------------------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED 16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY BY /s/ Thomas A. Spicer May 20, 1999
---------------------------------------- ---------------------------------------
(Signature of person authorized to sign) (Signature of Contracting Officer)
- ------------------------------------------------------------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV. 10-83)
PREVIOUS EDITION UNUSABLE Prescribed by GSA
FAR (48 CFR) 53.243
</TABLE>
DUPLICATE ORIGINAL
<PAGE> 134
NAS3-98008 Modification No. 2 Page 2
The contract is modified to reflect the Award Fee determination for the
evaluation period from from June 1, 1998 through February 28, 1999 as follows:
<TABLE>
<CAPTION>
Prior Amount This Action New Amount
------------ ----------- ----------
<S> <C> <C> <C>
Estimated Cost $42,185,846 -- $42,185,846
Earned Award Fee -- $ 549,755.00 $649,755.00
Potential Award Fee Pool $ 1,371,261 $(676,828.00) $694,433.00
----------- ------------ -----------
TOTAL CONTRACT $43,557,107 $ (27,073.00) $43,530,034
</TABLE>
<PAGE> 135
<TABLE>
<S> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT 1. CONTRACT ID CODE PAGE
1 of 2
- ------------------------------------------------------------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO. 3. EFFECTIVE DATE 4. REQUISITION/PURCHASE REQ.NO. 5. PROJECT NO. (if applicable)
1 11-9-98 N/A
- ------------------------------------------------------------------------------------------------------------------------------------
6. ISSUED BY CODE 0616/TAS 7. ADMINISTERED BY (IF OTHER THAN ITEM 6) CODE
------------ ------------
NASA Lewis Research Center
Attn: Thomas A Spicer
Services and Construction Branch
21000 Brookpark Road, Mail Stop 500-312
Cleveland, OH 44135-3191
- ------------------------------------------------------------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State and Zip Code) |_| 9A. AMENDMENT OF SOLICITATION NO.
Dynacs Engineering Company Inc. ---------------------------------------------
2001 Aerospace Parkway 9B. DATED (SEE ITEM 11)
Brookpark, Ohio 44142
---------------------------------------------
|X| 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS3-98008
---------------------------------------------
- ---------------------------------------------------------------------------------- 10B. DATED (SEE ITEM 13)
CODE (PF)(9) FACILITY CODE 12-17-98
- ------------------------------------------------------------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- ------------------------------------------------------------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour and date specified for receipt of Offers |_| is
extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date specified in the solicitation or as amended, by one of
the following methods:
(a) By completing Items 8 and 15, and returning ___ copies of the amendment; (b) By acknowledging receipt of this amendment on each
copy of the offer submitted; or (c) By separate letter or telegram which includes a reference to the solicitation and amendment
numbers. FAILURE OF YOUR ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND DATE
SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this amendment you desire to change an offer already submitted,
such change may be made by telegram or letter, provided each telegram or letter makes reference to the solicitation and this
amendment, and is received prior to the opening hour and date specified.
- ------------------------------------------------------------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (if required)
N/A
- ------------------------------------------------------------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- ------------------------------------------------------------------------------------------------------------------------------------
|_| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE
CONTRACT ORDER NO. IN ITEM 10A.
- ------------------------------------------------------------------------------------------------------------------------------------
|_| B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (such as changes in paying
office, appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR 43.103(b).
- ------------------------------------------------------------------------------------------------------------------------------------
|X| C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
Mutual Agreement
- ------------------------------------------------------------------------------------------------------------------------------------
|_| D. OTHER (Specify type of modification and authority)
B.4 Award Fee Pool (SEPT 97)
- ------------------------------------------------------------------------------------------------------------------------------------
E. IMPORTANT: Contractor |_| is not, |X| is required to sign this document and return 1 copies to the issuing office.
- ------------------------------------------------------------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings, including solicitation/contract subject matter
where feasible.)
(1) On October 28, 1998, consent was given to subcontract for assets owned by
Federal Data Corporation (FDC). The assets shall be depreciated over the
24 months remaining on the contract using the sum-of-years-digits
depreciation method. These assets are subject to clause G.9, "Option to
Purchase Contractor Equipment (Nov 1996):
- ------------------------------------------------------------------------------------------------------------------------------------
Except as provided herein, all terms and conditions of the document referenced in Item 9A or 10A, as heretofore changed, remains
unchanged and in full force and effect.
- ------------------------------------------------------------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print) 16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
KEVIN M McQUADE; DIR. BUSINESS & ADMIN Thomas A. Spicer, Contracting Officer
- ------------------------------------------------------------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED 16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY /s/ Kevin M McQuade 11-9-98 BY /s/ Thomas A. Spicer 11/9/98
---------------------------------------- ---------------------------------------
(Signature of person authorized to sign) (Signature of Contracting Officer)
- ------------------------------------------------------------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV. 10-83)
PREVIOUS EDITION UNUSABLE Prescribed by GSA
FAR (48 CFR) 53.243
</TABLE>
DUPLICATE ORIGINAL
<PAGE> 136
At the end of the contract period of performance, the Contractor grants the
Government options for the following: (1) the Contractor agrees to sell any
Contractor-owned property used in the performance of this contract to a
successor Contractor at its depreciated value based on the Contractor's
depreciation schedule; or (2) The Contractor agrees to sell any Contractor-Owned
property used in performance of this contract to the Government at its
depreciated value based on the Contractor's depreciation schedule; or (3) The
contractor agrees to utilize the depreciated property on a follow-on contract if
the Contractor is the Successor Contractor; or (4) the Contractor will sell the
property for fair market value within ninety days after the end of period of
performance and will credit the contract for the amount in excess of the sale
price minus the depreciated value and selling expenses. The Government may
exercise one of the above options by unilateral modification issued to the
Contractor not later than thirty (30) days after the end of the contract period
of performance.
(2) The following requirements are made a part of The Statement of Work:
(a) "Year 2000 compliant," as used herein, means that the information technology
(hardware, software and firmware, including embedded systems or any other
electro-mechanical or processor-based systems used in accordance with its
associated documentation) accurately processes date and date-related data
(including, but not limited to, calculating, comparing and sequencing) from,
into, and between the twentieth and twenty-first centuries, and the years 1999
and 2000 and leap year calculations, to the extent that other information
technology being acquired, properly exchanges date and date-related data with
it.
(b) Any information technology provided, operated and/or maintained under this
must be Year 2000 compliant. To ensure this result, the Contractor shall provide
documentation describing how the information technology (IT) items or services
demonstrate Year 2000 compliance.
(c) Milestones for Renovation, Validation and Implementation: Any IT determined
to be non-year 2000 compliant shall be replaced, retired, or repaired in
accordance with the following schedule:
o "Renovation" includes making and documenting software and hardware
changes, developing replacement systems, and decommissioning systems to be
retired. The Contractor must complete renovation of affected software,
hardware and firmware by December 31, 1998.
o "Validation includes unit, integration, system, and end-to-end testing for
2000 compliance. The contractor must complete validation and testing of
converted or replaced systems into a production environment. The
Contractor must complete implementation by March 31, 1999.
o "Implementation includes acceptance testing and integration of converted
and replaced systems into a production environment. The contractor must
complete implementation by March 31, 1999.
(d) At a minimum, the contractor shall provide documentation, including project
plans and status reports, which demonstrate that the Contractor is meeting the
milestones listed above.
<PAGE> 137
<TABLE>
<S> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT 1. CONTRACT ID CODE PAGE OF PAGES
NAS3-98008 1 407
- ------------------------------------------------------------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO. 3. EFFECTIVE DATE 4. REQUISITION/PURCHASE REQ.NO. 5. PROJECT NO. (if applicable)
Modification Number Three (03) 7/23/99 NONE SETAR II
- ------------------------------------------------------------------------------------------------------------------------------------
6. ISSUED BY CODE 7830/Lupson 7. ADMINISTERED BY (IF OTHER THAN ITEM 6) CODE
------------ ------------
NASA Glenn Research Center
Services & Construction Branch (M.S. 500-312)
21000 Brookpark Road
Cleveland, OH 44135-3191
- ------------------------------------------------------------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State and Zip Code) |X| 9A. AMENDMENT OF SOLICITATION NO.
Dynacs Engineering Company ---------------------------------------------
2001 Aerospace Parkway 9B. DATED (SEE ITEM 11)
Brookpark, Ohio 44142
---------------------------------------------
|X| 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS3-98008
---------------------------------------------
- ---------------------------------------------------------------------------------- 10B. DATED (SEE ITEM 13)
CODE FACILITY CODE 12/17/97
- ------------------------------------------------------------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- ------------------------------------------------------------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour and date specified for receipt of Offers |_| is
extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date specified in the solicitation or as amended, by one of
the following methods:
(a) By completing Items 8 and 15, and returning ___ copies of the amendment; (b) By acknowledging receipt of this amendment on each
copy of the offer submitted; or (c) By separate letter or telegram which includes a reference to the solicitation and amendment
numbers. FAILURE OF YOUR ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND DATE
SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this amendment you desire to change an offer already submitted,
such change may be made by telegram or letter, provided each telegram or letter makes reference to the solicitation and this
amendment, and is received prior to the opening hour and date specified.
- ------------------------------------------------------------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (if required)
N/A
- ------------------------------------------------------------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- ------------------------------------------------------------------------------------------------------------------------------------
|X| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE
CONTRACT ORDER NO. IN ITEM 10A.
- ------------------------------------------------------------------------------------------------------------------------------------
|_| B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (such as changes in paying
office, appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR 43.103(b).
- ------------------------------------------------------------------------------------------------------------------------------------
|X| C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF: Federal Acquisition Regulations (FAR) clauses
52.233-1 entitled "Disputes", 52.243-4 entitled "Changes" and mutual agreement
- ------------------------------------------------------------------------------------------------------------------------------------
|_| D. OTHER (Specify type of modification and authority)
- ------------------------------------------------------------------------------------------------------------------------------------
E. IMPORTANT: Contractor is required to sign this document and return ONE copies to the issuing office.
- ------------------------------------------------------------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings, including solicitation/contract subject matter
where feasible.)
(SEE ATTACHED PAGES)
- ------------------------------------------------------------------------------------------------------------------------------------
Except as provided herein, all terms and conditions of the document referenced in Item 9A or 10A, as heretofore changed, remains
unchanged and in full force and effect.
- ------------------------------------------------------------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print) 16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
/s/ [Illegible] Thomas A. Spicer / Contracting Officer
- ------------------------------------------------------------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED 16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
VICE PRESIDENT &
BY PROGRAM MANAGER 7/7/99 BY /s/ Thomas A. Spicer 7/23/99
---------------------------------------- ---------------------------------------
(Signature of person authorized to sign) (Signature of Contracting Officer)
- ------------------------------------------------------------------------------------------------------------------------------------
NSN 7540-01-152-807030-105 STANDARD FORM 30 (REV. 10-83)
PREVIOUS EDITION UNUSABLE Prescribed by GSA
FAR (48 CFR) 53.243
</TABLE>
DUPLICATE ORIGINAL
<PAGE> 138
MODIFICATION NUMBER THREE (3) PAGE 2 OF 407
WHEREAS, The Government has directed and requested certain changes in the
contract, and the Contractor has submitted the appropriate proposals
for the additional changes requested; and
WHEREAS, The Parties hereto have negotiated and agreed to an equitable
adjustment in the contract;
NOW THEREFORE, In consideration of the premises and of the obligations herein
set forth, the parties hereto do mutually agree as follows:
"In Section B of the contract, page B-2 is deleted in its entirety and the
attached Section B page B-2/Revised is substituted therefore and made a part
hereof;
In Section G of the contract, pages G-13 and G-14 are deleted in their entirety
and the attached Section G pages G-13/Revised and G-14/Revised is substituted
therefor. Pages G-19 through G-26 /Revised are hereby added to Section G and
include the contract clauses G.20 "Government Property (52.245-5)", G.21
"Financial Reporting Of NASA Property In The Custody Of
Contractors(1852.245-73)" and G.22 "List Of Government-Furnished
Property(1852.245-76)" and are made a part hereof;
In Section I of the Contract, pages I-42 through I-50/Revised are hereby added
to Section I and include the contract clauses I-21 "Employment Reports On
Disabled Veterans and Veterans Of The Vietnam Era(52.222-37)" and I-22 "New
Technology(1852.227-70) and are made a part hereof;
In Section J of the Contract, Section J is deleted in it's entirety and the
Attached Section J Revised is substituted therefor and made a part hereof;
The Period of Performance remains unchanged from June 1, 1998 to August 31,
2000.
The Parties hereto acknowledge and agree that any and all claims for equitable
adjustment of the contract price and time pursuant to the provisions of the
clause(s) 52.243-04 entitled "CHANGES", and 52.233-01 entitled "DISPUTES" and
Mutual Agreement are hereby fully satisfied and discharged with respect to this
Supplemental Agreement Number Three (3).
[END OF MODIFICATION)
<PAGE> 139
SECTION B / REVISED
Contract Maximum: The Government issued Task Order(s) under this contract shall
not exceed a maximum of $66,797,004 (Cost=$64,795,583; Fee/Profit=$2,001,421)
for the 27 months of performance.
Task Order(s) shall be issued on either a Firm Fixed Price (FFP) basis or on a
Cost Reimbursable (CR) basis.
Ten percent of the technical hours (111,065 hours) have the potential of being
worked under fixed priced task order(s). The profit will be $2.34/technical hour
arced to at task acceptance. The maximum total fixed fee for 27 months is
$259,892.
Ninety percent of the technical hours (999,582 hours) have the potential of
being worked under cost plus award fee task order(s).
The Award Fee periods, award fee per technical hour, and the maximum award fee
pool is as follows:
<TABLE>
<CAPTION>
Period Fee Per Tech. Hour Maximum Award Fee Pool
- ------ ------------------ ----------------------
<S> <C> <C> <C>
1 Jun 1/98-Feb 28/99 $1.78 $649,755
2 Mar 1/99-Aug 31/99 $1.81 $454,404
3 Sep 1/99-Feb 28/00 $1.81 $443,269
4 Mar l/00-Aug 31/00 $1.81 $453,993
TOTAL $2,001,421
</TABLE>
(a) FIRM FIXED PRICE TASK ORDERS
Firm Fixed Price task order(s) shall be issued for work that can be well defined
and for which a fair and reasonable price can be obtained. The price is not
subject to any adjustment on the basis of contract cost experience.
(b) COST - REIMBURSEMENT TASK ORDERS
Work performed by the contractor shall be reimbursed based upon allowable costs
incurred, subject to negotiated limitations.
(c) AWARD FEE
Based upon the Contractor's overall performance, an award fee may be provided to
the Contractor. The amount of fee will be determined by the Government. The
award fee pool will be divided into two parts. The first part will consider the
contract administration and cost control. The second part will consider task
order performance.
(End Of Clause)
Page B-2 / Revised
<PAGE> 140
SECTION G / REVISED
(1) Final payment for Distributed Cost, including General and Administrative
(G&A) expenses will be based on the application of the actual audited rate, but
not in excess of the following ceilings:
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
RATE BASE TO WHICH RATE CFY 1998 CFY 1999
CATEGORY APPLIES JUNE 1 - DEC.31 JAN.1-JUNE 3O
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
SUPPORT TECHNICAL PRODUCTIVE 5.25% 7.70%
LABOR LABOR COST
- --------------------------------------------------------------------------------
LABOR TECHNICAL PRODUCTIVE 33.40% 33.80%
OVERHEAD LABOR COST
- --------------------------------------------------------------------------------
GENERAL & TOTAL ALLOWABLE 1.70% 1.90%
ADMINISTRATIVE EXCLUDING TASK DIRECT
EXPENSE
- --------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
RATE CATEGORY BASE TO WHICH RATE CFY 1999 CFY 2000
APPLIES JULY 1 - DEC.31 JAN. 1-AUG.31
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
DISTRIBUTED TECHNICAL PRODUCTIVE 75% 75%
COSTS LABOR COST
- --------------------------------------------------------------------------------
GENERAL & TOTAL ALLOWABLE 4% 4%
ADMINISTRATIVE EXCLUDING TASK DIRECT &
EXPENSE APPLICABLE. G&A*
- --------------------------------------------------------------------------------
</TABLE>
*Note: This 4% cap is included in the total ceiling rate of 75%
(2) Definitions:
"Distributed Costs" is the Support Labor, Labor Overhead. ODC's-Facilities.
Other ODC's and G&A.
(i) "Technical Productive Labor Cost" is the direct labor cost, without any
burdens, of ALL personnel charging directly to task orders, in accordance with
the contractor & DCAA approved accounting system EXCLUDING the following
personnel and/or functions:
(A) Program Manager
(B) Department Directors
(C) Executive Secretary
(D) Support Overhead Labor
(ii) "Program Manager" is the individual who runs the Dynacs organization at
GRC. This person. regardless of title classification, would be responsible for
the directing and carrying on of Dynacs' business and/or affairs as they relate
to the overall performance of this contract.
(iii) "Department Directors" are those individuals who are one level below the
"Program Manager" and who are entrusted with the overall direction and operation
of the "technical departments" at GRC. The "technical departments" are
Aeromechanics. Aerospace Technology. Aeropropulsion Systems. and Space Sciences.
(iv) "Executive Secretary" is the individual(s) who to a substantial degree,
directly or indirectly, provides the "Program Manager" with secretarial support.
Page G-13 / Revised
<PAGE> 141
SECTION G / REVISED
(v) "Support Labor" labor in addition to labor defined in (ii), (iii) and (iv)
above, associated with the following administrative functions: Accounting,
Payroll, Human Resources, Contract Management, Purchasing, and Safety & Quality
Assurance.
(vi) "Direct Labor Cost" is that cost associated with any personnel who is not
in a paid absence status such as vacation, sick, or holiday leave AND which is
properly recorded and charged to the contract as Direct Labor Cost in accordance
with both written company policy AND the contractors DCAA approved accounting
system.
(vii) "Task Direct Charges" is that cost which is directly chargeable to a task
order such as. but not limited to, travel and training directly related to a
specific task AND any equipment and material directly related to, and/or
necessary for, the performance of a specific task.
(viii) "Labor Overhead" is the cost associated with employee absences, taxes,
and benefits. Specific cost elements include but is not limited to: vacation,
sick, administrative leave, RCA, FUTA, SUTA, workers compensation, employee
morale and welfare, 401-(k), medical coverage, and long-term disability
coverage.
(ix) "G&A" is the Home Office residual costs allocated in accordance with CAS
403.
(x) "Distributed Costs" are ALL CONTRACT DIRECT AND INDIRECT costs other than
those costs specifically identified as "Technical Productive Labor Costs," "Task
Direct Charges," and " Award Fee." "Distributed Costs" include cost elements
such as: Labor Overhead, Facilities, Support Labor, Other Support and G&A.
(3) Exceptions:
(i) Increased Distributed Costs during the term of this contract that
result from such items as statute, court decision or written rulings
or regulations by the Internal Revenue Service or other taxing
authority may be cause for adjustment of the distributed rate.
(ii) Notwithstanding the above paragraph, in the event that the actual
distributed rate exceeds the ceiling rate; all costs in excess of
the ceiling rate are not reimbursable under this contract.
(iii) The Contractor shall advise the Contracting Officer of any planned
or approved accounting changes that would impact the subject rates
and demonstrate how the changes will impact the negotiated ceilings.
Page G-14 / Revised
<PAGE> 142
SECTION G / REVISED
GOVERNMENT PROPERTY CLAUSES FAR/NASA-FAR
G.20 GOVERNMENT PROPERTY(Cost-Reimbursement, Time-and-Material, or Labor-Hour
Contracts). (Jan 1986) 52.245-5
(a) Government-furnished property.
(1) The term "Contractor's managerial personnel," as used in paragraph (g) of
this clause, means any of the Contractor's directors, officers, managers,
superintendents, or equivalent representatives who have supervision or direction
of--
(i) All or substantially all of the Contractor's business;
(ii) All or substantially all of the Contractor's operation at any one plant, or
separate location at which the contract is being performed; or
(iii) A separate and complete major industrial operation connected with
performing this contract.
(2)The Government shall deliver to the Contractor, for use in connection with
and under the terms of this contract, the Government-furnished property
described in the Schedule or specifications, together with such related data and
information as the Contractor may request and as may be reasonably required for
the intended use of the property (hereinafter referred to as
"Government-Furnished Property").
(3) The delivery or performance dates for this contract are based upon the
expectation that Government-furnished property suitable for use will be
delivered to the Contractor at the times stated in the Schedule or, if not so
stated, in sufficient time to enable the Contractor to meet the contract's
delivery or performance dates.
(4) If Government-furnished property is received by the Contractor in a
condition not suitable for the intended use, the Contractor shall, upon receipt,
notify the Contracting Officer, detailing the facts, and, as directed by the
Contracting Officer and at Government expense, either effect repairs or
modification or return or otherwise dispose of the property. After completing
the directed action and upon written request of the Contractor, the Contracting
Officer shall make an equitable adjustment as provided in paragraph (h) of this
clause.
(5) If Government-furnished property is not delivered to the Contractor by the
required time or times, the Contracting Officer shall, upon the Contractor's
timely written request,
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SECTION G / REVISED
make a determination of the delay, if any, caused the Contractor and shall make
an equitable adjustment in accordance with paragraph (h) of this clause.
(b) Changes in Government-furnished property. (1) The Contracting Officer may,
by written notice, (i) decrease the Government-furnished property provided or to
be provided under this contract or (ii) substitute other Government-furnished
property for the property to be provided by the Government or to be acquired by
the Contractor for the Government under this contract. The Contractor shall
promptly take such action as the Contracting Officer may direct regarding the
removal, shipment, or disposal of the property covered by this notice.
(2) Upon the Contractor's written request, the Contracting Officer shall make an
equitable adjustment to the contact in accordance with paragraph (h) of this
clause, if the Government has agreed in the Schedule to make such property
available for performing this contract and there is any-- (i) Decrease or
substitution in this property pursuant to subparagraph (b)(1) above; or (ii)
Withdrawal of authority to use property, if provided under any other contract or
lease. (c) Title. (1) The Government shall retain title to all
Government-furnished property.
(2) Title to all property purchased by the Contractor for which the Contractor
is entitled to be reimbursed as a direct item of cost under this contract shall
pass to and vest in the Government upon the vendor's delivery of such property.
(3) Title to all other property, the cost of which is reimbursable to the
Contractor, shall pass to and vest in the Government upon--
(i) Issuance of the property for use in contract performance;
(ii) Commencement of processing of the property for use in contract performance;
or
(iii) Reimbursement of the cost of the property by the Government, whichever
occurs first.
(4) All Government-furnished property and all property acquired by the
Contractor, title to which vests in the Government under this paragraph
(collectively referred to as "Government property"), are subject to the
provisions of this clause. Title to Government property shall not be affected by
its incorporation into or attachment to any property not owned by the
Government, nor shall Government property become a fixture or lose its identity
as personal property by being attached to any real property.
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SECTION G / REVISED
(d) Use of Government property. The Government property shall be used only for
performing this contract, unless otherwise provided in this contract or approved
by the Contracting Officer.
(e) Property administration. (1) The Contractor shall be responsible and
accountable for all Government property provided under the contract and shall
comply with Federal Acquisition Regulation (FAR) Subpart 45.5, as in effect on
the date of this contract.
(2) The Contractor shall establish and maintain a program for the use,
maintenance, repair, protection, and preservation of Government property in
accordance with sound business practice and the applicable provisions of FAR
Subpart 45.5.
(3) If damage occurs to Government property, the risk of which has been assumed
by the Government under this contract, the Government shall replace the items or
the Contractor shall make such repairs as the Government directs. However, if
the Contractor cannot effect such repairs within the time required, the
Contractor shall dispose of the property as directed by the Contracting Officer.
When any property for which the Government is responsible is replaced or
repaired, the Contracting Officer shall make an equitable adjustment in
accordance with paragraph (h) of this clause.
(f) Access. The Government and all its designees shall have access at all
reasonable times to the premises in which any Government property is located for
the purpose of inspecting the Government property.
(g) Limited risk of loss. (1) The Contractor shall not be liable for loss or
destruction of, or damage to, the Government property provided under this
contract or for expenses incidental to such loss, destruction, or damage, except
as provided in subparagraphs (2) and (3) below.
(2) The Contractor shall be responsible for loss or destruction of, or damage
to, the Government property provided under this contract (including expenses
incidental to such loss, destruction, or damage)--
(i) That results from a risk expressly required to be insured under this
contract, but only to the extent of the insurance required to be purchased and
maintained or to the extent of insurance actually purchased and maintained,
whichever is greater;
(ii) That results from a risk that is in fact covered by insurance or for which
the Contractor is otherwise reimbursed, but only to the extent of such insurance
or reimbursement;
(iii) For which the Contractor is otherwise responsible under the express terms
of this contract;
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SECTION G / REVISED
(iv) That results from willful misconduct or lack of good faith on the part of
the Contractor's managerial personnel; or
(v) That results from a failure on the part of the Contractor, due to willful
misconduct or lack of good faith on the part of the Contractor's managerial
personnel, to establish and administer a program or system for the control, use,
protection, preservation, maintenance, and repair of Government property as
required by paragraph (e) of this clause.
(3)(i) If the Contractor fails to act as provided by subdivision (g)(2)(v)
above, after being notified (by certified mail addressed to one of the
Contractor's managerial personnel) of the Government's disapproval, withdrawal
of approval, or nonacceptance of the system or program, it shall be conclusively
presumed that such failure was due to willful misconduct or lack of good faith
on the part of the Contractor's managerial personnel.
(ii) In such event, any loss or destruction of, or damage to, the Government
property shall be presumed to have resulted from such failure unless the
Contractor can establish by clear and convincing evidence that such loss,
destruction, or damage--
(A) Did not result from the Contractor's failure to maintain an approved program
or system; or
(B) Occurred while an approved program or system was maintained by the
Contractor.
(4) If the Contractor transfers Government property to the possession and
control of a subcontractor, the transfer shall not affect the liability of the
Contractor for loss or destruction of, or damage to, the property as set forth
above. However, the Contractor shall require the subcontractor to assume the
risk of, and be responsible for, any loss or destruction of, or damage to, the
property while in the subcontractor's possession or control, except to the
extent that the subcontract, with the advance approval of the Contracting
Officer, relieves the subcontractor from such liability. In the absence of such
approval, the subcontract shall contain appropriate provisions requiring the
return of all Government property in as good condition as when received, except
for reasonable wear and tear or for its use in accordance with the provisions of
the prime contract.
(5) Upon loss or destruction of, or damage to, Government property provided
under this contract, the Contractor shall so notify the Contracting Officer and
shall communicate with the loss and salvage organization, if any, designated by
the Contracting Officer. With the assistance of any such organization, the
Contractor shall take all reasonable action to protect the Government property
from further damage, separate the damaged and undamaged Government property, put
all the affected Government property in the best possible order, and furnish to
the Contracting Officer a statement of--
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SECTION G / REVISED
(i) The lost, destroyed, or damaged Government property;
(ii) The time and origin of the loss, destruction, or damage;
(iii) All known interests in commingled property of which the Government
property is a part; and
(iv) The insurance, if any, cove ring any pan of or interest in such commingled
property.
(6) The Contractor shall repair, renovate, and take such other action with
respect to damaged Government property as the Contracting Officer directs. If
the Government property is destroyed or damaged beyond practical repair, or is
damaged and so commingled or combined with property of others (including the
Contractor's) that separation is impractical, the Contractor may, with the
approval of and subject to any conditions imposed by the Contracting Officer,
sell such property for the account of the Government. Such sales may be made in
order to minimize the loss to the Government, to permit the resumption of
business, or to accomplish a similar purpose. The Contractor shall be entitled
to an equitable adjustment in the contract price for the expenditures made in
performing the obligations under this subparagraph (g)(6) in accordance with
paragraph (h) of this clause. However, the Government may directly reimburse the
loss and salvage organization for any of their charges. The Contracting Officer
shall give due regard to the Contractor's liability under this paragraph (g)
when making any such equitable adjustment.
(7) The Contractor shall not be reimbursed for, and shall not include as an item
of overhead, the cost of insurance or of any reserve covering risk of loss or
destruction of or damage to, Government property, except to the extent that the
Government may have expressly required the Contractor to carry such insurance
under another provision of this contract.
(8) In the event the Contractor is reimbursed or otherwise compensated for any
loss or destruction of, or damage to, Government property, the Contractor shall
use the proceeds to repair, renovate, or replace the lost, destroyed, or damaged
Government property or shall otherwise credit the proceeds to, or equitably
reimburse, the Government, as directed by the Contracting Officer.
(9) The Contractor shall do nothing to prejudice the Government's rights to
recover against third parties for any loss or destruction of, or damage to,
Government property. Upon the request of the Contracting Officer, the Contractor
shall, at the Government's expense, furnish to the Government all reasonable
assistance and cooperation (including the prosecution of suit and the execution
of instruments of assignment in favor of the Government) in obtaining recovery.
In addition, where a subcontractor has not been relieved from liability for any
loss or destruction of or damage to, Government property,
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SECTION G / REVISED
the Contractor shall enforce for the benefit of the Government the liability of
the subcontractor for such loss, destruction, or damage.
(h) Equitable adjustment. When this clause specifies an equitable adjustment, it
shall be made to any affected contract provision in accordance with the
procedures of the Changes clause. When appropriate, the Contracting Officer may
initiate an equitable adjustment in favor of the Government. The right to an
equitable adjustment shall be the Contractor's exclusive remedy, the Government
shall not be liable to suit for breach of contract for--
(1) Any delay in delivery of Government-furnished property;
(2) Delivery of Government-furnished property in a condition not suitable for
its intended use;
(3) A decrease in or substitution of Government-furnished property; or
(4) Failure to repair or replace Government property for which the Government is
responsible.
(i) Final accounting and disposition of Government property. Upon completing
this contract, or at such earlier dates as may be fixed by the Contracting
Officer, the Contractor shall submit, in a form acceptable to the Contracting
Officer, inventory schedules covering all items of Government property not
consumed in performing this contract or delivered to the Government. The
Contractor shall prepare for shipment, deliver f.o.b. origin, or dispose of the
Government property as may be directed or authorized by the Contracting Officer.
The net proceeds of any such disposal shall be credited to the cost of the work
covered by this contract or paid to the Government as directed by the
Contracting Officer. The foregoing provisions shall apply to scrap from
Government property; provided, however, that the Contracting Officer may
authorize or direct the Contractor to omit from such inventory schedules any
scrap consisting of faulty castings or forgings or of cutting and processing
waste, such as chips, cuttings, borings, turnings, short ends, circles,
trimmings, clippings, and remnants, and to dispose of such scrap in accordance
with the Contractor's normal practice and account for it as a part of general
overhead or other reimbursable costs in accordance with the Contractor's
established accounting procedures.
(j) Abandonment and restoration of Contractor premises. Unless otherwise
provided herein, the Government--
(1) May abandon any Government property in place, at which time all obligations
of the Government regarding such abandoned property shall cease; and
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SECTION G / REVISED
(2) Has no obligation to restore or rehabilitate the Contractor's premises under
any circumstances (e.g., abandonment, disposition upon completion of need, or
contract completion). However, if the Government-furnished property (listed in
the Schedule or specifications) is withdrawn or is unsuitable for the intended
use, or if other Government property is substituted, then the equitable
adjustment under paragraph (h) of this clause may properly include restoration
or rehabilitation costs.
(k) Communications. All communications under this clause shall be in writing.
(l) Overseas contracts. If this contract is to be performed outside the United
States of America, its territories, or possessions, the words "Government" and
"Government-furnished" (wherever they appear in this clause) shall be construed
as "United States Government" and "United States Government-furnished,"
respectively.
(End of clause)
G.21 FINANCIAL REPORTING OF NASA PROPERTY IN THE CUSTODY OF CONTRACTORS
(SEPTEMBER 1996) 1852.245-73
(a) The Contractor shall submit annually a NASA Form (NF) 1018, NASA Property in
the Custody of Contractors, in accordance with 1845.505-14, the instructions on
the form, and subpart 1845.71. Subcontractor use of NF 1018 is not required by
this clause; however, the contractor shall include data on property in the
possession of subcontractors in the annual NF-1018.
(b) If administration of this contract has been delegated to the Department of
Defense, the original of NASA Form 1018 shall be submitted to the NASA
installation Financial Management Officer and three copies shall be sent
concurrently through the DOD Property Administrator to the NASA office
identified below. If the contract is administered by NASA, the original of NF -
1018 shall be submitted to the installation Financial Management Officer, and
three copies shall be sent concurrently to the following NASA office:
NASA GLENN RESEARCH CENTER
INDUSTRIAL PROPERTY OFFICE
M.S. 21-6
(c) The annual reporting period shall be from October 1 of each year through
September 30 of the following year. The report shall be submitted in time to be
received by October 31. The information contained in these reports is entered
into the NASA accounting system to reflect current asset values for agency
financial statement purposes. Therefore, it is essential that required reports
be received no later than October 31. The Contracting Officer may, in the
Government's interest, withhold payment until
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SECTION G / REVISED
a reserve not exceeding $25,000 or 5 percent of the amount of the contract,
whichever is less, has been set aside, if the Contractor fails to submit annual
NF 1018 reports when due, Such reserve shall be withheld until the Contracting
Officer has determined that the required reports have been received by the
Government. The withholding of any amount or the subsequent payment thereof
shall not be construed as a waiver of any Government right.
(d) A final report is required within 30 days after disposition of all property
subject to reporting when the contract performance period is complete.
(End of clause)
G.22 LIST OF GOVERNMENT-FURNISHED PROPERTY (OCTOBER 1988) 1852.245-76
For performance of work under this contract, the Government will make available
Government property identified below or in Attachment A of this contract on a
no-charge-for-use basis. The Contractor shall use this property in the
performance of this contract at the 2K1 Building and at other location(s) as may
be approved by the Contracting Officer. Under the FAR 5 2.245 Government
property clause of this contract, the Contractor is accountable for the
identified property.
See Attachment A for Item, Quantity, Acquisition Cost, and Date to be Furnished
to the Contractor.
(End of clause)
[REVISED END OF SECTION]
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SECTION I / REVISED
I.21 Employment Reports on Disabled Veterans and Veterans of the Vietnam Era.
52.222-37
Employment Reports on Disabled Veterans and Veterans of the Vietnam Era (Jan
1999)
(a) Unless the Contractor is a State or local government agency, the Contractor
shall report at least annually, as required by the Secretary of Labor, on--
(1) The number of disabled veterans and the number of veterans of the Vietnam
era in the workforce of the contractor by job category and hiring location; and
(2) The total number of new employees hired during the period covered by the
report, and of that total, the number of disabled veterans, and the number of
veterans of the Vietnam era.
(b) The above items shall be reported by completing the form entitled "Federal
Contractor Veterans' Employment Report VETS-l00."
(c) Reports shall be submitted no later than September 30 of each year beginning
September 30, 1988.
(d) The employment activity report required by paragraph (a)(2) of this clause
shall reflect total hires during the most recent 12-month period as of the
ending date selected for the employment profile report required by paragraph
(a)(1) of this clause. Contractors may select an ending date:
(1) As of the end of any pay period during the period January through March 1st
of the year the report is due, or
(2) As of December 31, if the contractor has previous written approval from the
Equal Employment Opportunity Commission to do so for purposes of submitting the
Employer Information Report EEO-1 (Standard Form 100).
(e) The count of veterans reported according to paragraph (a) of this clause
shall be based on voluntary disclosure. Each Contractor subject to the reporting
requirements at 38 U.S.C. 4212 shall invite all disabled veterans and veterans
of the Vietnam era who wish to benefit under the affirmative action program at
38 U.S.C. 4212 to identify themselves to the Contractor. The invitation shall
state that the information is voluntarily provided; that the information will be
kept confidential; that disclosure or refusal to provide the information will
not subject the applicant or employee to any adverse treatment; and that the
information will be used only in accordance with the regulations promulgated
under 38 U.S.C. 4212.
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SECTION I / REVISED
(f) Subcontracts. The Contractor shall include the terms of this clause in every
subcontract or purchase order of $10,000 or more unless exempted by rules,
regulations, or orders of the Secretary.
(End of clause)
1.22 NEW TECHNOLOGY (NOVEMBER 1998) 1852.227-70
(a) Definitions.
"Administrator," as used in this clause, means the Administrator of the National
Aeronautics and Space Administration (NASA) or duly authorized representative.
"Contract," as used in this clause, means any actual or proposed contract,
agreement, understanding, or other arrangement, and includes any assignment,
substitution of parties, or subcontract executed or entered into thereunder.
"Made," as used in this clause, means conception or first actual reduction to
practice; provided, that in the case of a variety of plant, the date of
determination (as defined in Section 4 1(d) of the Plant Variety Protection Act,
7 U.S.C. 240 1(d)) must also occur during the period of contract performance.
"Nonprofit organization," as used in this clause, means a domestic university or
other institution of higher education or an organization of the type described
in section 501(c)(3) of the Internal Revenue Code of 1954 (26 U.S.C. 501(c)) and
exempt from taxation under section 501(a) of the Internal Revenue Code (26
U.S.C. 501(a)), or any domestic nonprofit scientific or educational organization
qualified under a State nonprofit organization statute.
"Practical application," as used in this clause, means to manufacture, in the
case of a composition or product; to practice, in the case of a process or
method; or to operate, in case of a machine or system; and, in each case, under
such conditions as to establish that the invention is being utilized and that
its benefits are, to the extent permitted by law or Government regulations,
available to the public on reasonable terms.
"Reportable item," as used in this clause, means any invention, discovery,
improvement, or innovation of the contractor, whether or not patentable or
otherwise protectible under Title 35 of the United States Code, made in the
performance of any work under any NASA contract or in the performance of any
work that is reimbursable under any clause
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SECTION I / REVISED
in any NASA contract providing for reimbursement of costs incurred before the
effective date of the contract. Reportable items include, but are not limited
to, new processes, machines, manufactures, and compositions of matter, and
improvements to, or new applications of, existing processes, machines,
manufactures, and compositions of matter. Reportable items also include new
computer programs, and improvements to, or new applications of, existing
computer programs, whether or not copyrightable or otherwise protectible under
Title 17 of the United States Code.
"Small business firm," as used in this clause, means a domestic small business
concern as defined at 15 U.S.C. 632 and implementing regulations of the
Administrator of the Small Business Administration. (For the purpose of this
definition, the size standard contained in 13 CFR 121.3-8 for small business
contractors and in 13 CFR 121.3-12 for small business subcontractors will be
used.)
"Subject invention," as used in this clause, means any reportable item which is
or may be patentable or otherwise protectible under Title 35 of the United
States Code, or any novel variety of plant that is or may be protectible under
the Plant Variety Protection Act (7 U.S.C. 2321, et seq.).
(b) Allocation of principal rights.
(1) Presumption of title.
(i) Any reportable item that the Administrator considers to be a subject
invention shall be presumed to have been made in the manner specified in
paragraph (1) or (2) of Section 305(a) of the National Aeronautics and Space Act
of 1958 (42 U.S.C. 2457(a)) (hereinafter called "the Act"), and the above
presumption shall be conclusive unless at the time of reporting the reportable
item the Contractor submits to the Contracting Officer a written statement,
containing supporting details, demonstrating that the reportable item was not
made in the manner specified in paragraph (1) or (2) of Section 305(a) of the
Act.
(ii) Regardless of whether title to a given subject invention would otherwise be
subject to an advance waiver or is the subject of a petition for waiver, the
Contractor may nevertheless file the statement described in paragraph (b)(1)(i)
of this clause. The Administrator will review the information furnished by the
Contractor in any such statement and any other available information relating to
the circumstances surrounding the making of the subject invention and will
notify the Contractor whether the Administrator has determined that the subject
invention was made in the manner specified in paragraph (1) or (2) of Section
305(a) of the Act.
(2) Property rights in subject inventions. Each subject invention for which the
presumption of paragraph (b)(1)(i) of this clause is conclusive or for which
there has been
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SECTION I / REVISED
a determination that it was made in the manner specified in paragraph (1) or (2)
of Section 305(a) of the Act shall be the exclusive property of the United
States as represented by NASA unless the Administrator waives all or any part of
the rights of the United States, as provided in paragraph (b)(3) of this clause.
(3) Waiver of rights.
(i) Section 305(f) of the Act provides for the promulgation of regulations by
which the Administrator may waive the rights of the United States with respect
to any invention or class of inventions made or that may be made under
conditions specified in paragraph (1) or (2) of Section 305(a) of the Act. The
promulgated NASA Patent Waiver Regulations, 14 CFR Section 1245, Subpart 1, have
adopted the Presidential Memorandum on Government Patent Policy of February 18,
1983, as a guide in acting on petitions (requests) for such waiver of rights.
(ii) As provided in 14 CFR 1245, Subpart 1, Contractors may petition, either
prior to execution of the contract or within 30 days after execution of the
contract, for advance waiver of rights to any or all of the inventions that may
be made under a contract. If such a petition is not submitted, or if after
submission it is denied, the Contractor (or an employee inventor of the
Contractor) may petition for waiver of rights to an identified subject invention
within eight months of first disclosure of invention in accordance with
paragraph (e)(2) of this clause, or within such longer period as may be
authorized in accordance with 14 CFR 1245.105.
(c) Minimum rights reserved by the Government.
(1) With respect to each subject invention for which a waiver of rights is
applicable in accordance with 14 CFR Section 1245, Subpart I, the Government
reserves--
(i)An irrevocable, nonexclusive, nontransferable, royalty-free license for the
practice of such invention throughout the world by or on behalf of the United
States or any foreign government in accordance with any treaty or agreement with
the United States; and
(ii) Such other rights as stated in 14 CFR 1245.107.
(2) Nothing contained in this paragraph (c) shall be considered to grant to the
Government any rights with respect to any invention other than a subject
invention.
(d) Minimum rights to the Contractor.
(1) The Contractor is hereby granted a revocable, nonexclusive, royalty-free
license in each patent application filed in any country on a subject invention
and any resulting patent in which the Government acquires title, unless the
Contractor fails to disclose the subject invention within the times specified in
paragraph (e)(2) of this clause.
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SECTION I / REVISED
The Contractor's license extends to its domestic subsidiaries and affiliates, if
any, within the corporate structure of which the Contractor is a party and
includes the right to grant sublicenses of the same scope to the extent the
Contractor was legally obligated to do so at the time the contract was awarded.
The license is transferable only with the approval of the Administrator except
when transferred to the successor of that part of the Contractor's business to
which the invention pertains.
(2) The Contractor's domestic license may be revoked or modified by the
Administrator to the extent necessary to achieve expeditious practical
application of the subject invention pursuant to an application for an exclusive
license submitted in accordance with 37 CFR Part 404, Licensing of Government
Owned Inventions. This license will not be revoked in that field of use or the
geographical areas in which the Contractor has achieved practical application
and continues to make the benefits of the invention reasonably accessible to the
public. The license in any foreign country may be revoked or modified at the
discretion of the Administrator to the extent the Contractor, its licensees, or
its domestic subsidiaries or affiliates have failed to achieve practical
application in that foreign country.
(3) Before revocation or modification of the license, the Contractor will be
provided a written notice of the Administrator's intention to revoke or modify
the license, and the Contractor will be allowed 30 days (or such other time as
may be authorized by the Administrator for good cause shown by the Contractor)
after the notice to show cause why the license should not be revoked or
modified. The Contractor has the right to appeal to the Administrator any
decision concerning the revocation or modification of its license.
(e) Invention identification, disclosures, and reports.
(1) The Contractor shall establish and maintain active and effective procedures
to assure that reportable items are promptly identified and disclosed to
Contractor personnel responsible for the administration of this New Technology
clause within six months of conception and/or first actual reduction to
practice, whichever occurs first in the performance of work under this contract.
These procedures shall include the maintenance of laboratory notebooks or
equivalent records and other records as are reasonably necessary to document the
conception and/or the first actual reduction to practice of the reportable
items, and records that show that the procedures for identifying and disclosing
reportable items are followed. Upon request, the Contractor shall furnish the
Contracting Officer a description of such procedures for evaluation and for
determination as to their effectiveness.
(2) The Contractor will disclose each reportable item to the Contracting Officer
within two months after the inventor discloses it in writing to Contractor
personnel responsible for the administration of this New Technology clause or,
if earlier, within six
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SECTION I / REVISED
months after the Contractor becomes aware that a reportable item has been made,
but in any event for subject inventions before any on sale, public use, or
publication of such invention known to the Contractor. The disclosure to the
agency shall be in the form of a written report and shall identify the contract
under which the reportable item was made and the inventor(s) or innovator(s). It
shall be sufficiently complete in technical detail to convey a clear
understanding, to the extent known at the time of the disclosure, of the nature,
purpose, operation, and physical, chemical, biological, or electrical
characteristics of the reportable item. The disclosure shall also identify any
publication, on sale, or public use of any subject invention and whether a
manuscript describing such invention has been submitted for publication and, if
so, whether it has been accepted for publication at the time of disclosure. In
addition, after disclosure to the agency, the Contractor will promptly notify
the agency of the acceptance of any manuscript describing a subject invention
for publication or of any on sale or public use planned by the Contractor for
such invention.
(3) The Contractor shall furnish the Contracting Officer the following:
(i) Interim reports every 12 months (or such longer period as may be specified
by the Contracting Officer) from the date of the contract, listing reportable
items during that period, and certifying that all reportable items have been
disclosed (or that there are no such inventions) and that the procedures
required by paragraph (e)(l) of this clause have been followed.
(ii) A final report, within 3 months after completion of the contracted work,
listing all reportable items or certifying that there were no such reportable
items, and listing all subcontracts at any tier containing a patent rights
clause or certifying that there were no such subcontracts.
(4) The Contractor agrees, upon written request of the Contracting Officer, to
furnish additional technical and other information available to the Contractor
as is necessary for the preparation of a patent application on a subject
invention and for the prosecution of the patent application, and to execute all
papers necessary to file patent applications on subject inventions and to
establish the Government's rights in the subject inventions.
(5) The Contractor agrees, subject to paragraph 27.302(i), of the Federal
Acquisition Regulation (FAR), that the Government may duplicate and disclose
subject invention disclosures and all other reports and papers furnished or
required to be furnished pursuant to this clause.
(f) Examination of records relating to inventions.
Page I-47 / Revised
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SECTION I / REVISED
(1) The Contracting Officer or any authorized representative shall, until 3
years after final payment under this contract, have the right to examine any
books (including laboratory notebooks), records, and documents of the Contractor
relating to the conception or first actual reduction to practice of inventions
in the same field of technology as the work under this contract to determine
whether--
(i) Any such inventions are subject inventions;
(ii) The Contractor has established and maintained the procedures required by
paragraph (e)(1) of this clause; and
(iii) The Contractor and its inventors have complied with the procedures.
(2) If the Contracting Officer learns of an unreported Contractor invention that
the Contracting Officer believes may be a subject invention, the Contractor may
be required to disclose the invention to the agency for a determination of
ownership rights.
(3) Any examination of records under this paragraph will be subject to
appropriate conditions to protect the confidentiality of the information
involved.
(g) Withholding of payment (this paragraph does not apply to subcontracts).
(1) Any time before final payment under this contract, the Contracting Officer
may, in the Government's interest, withhold payment until a reserve not
exceeding $50,000 or 5 percent of the amount of this contract, whichever is
less, shall have been set aside if, in the Contracting Officer's opinion, the
Contractor fails to--
(i) Establish, maintain, and follow effective procedures for identifying and
disclosing reportable items pursuant to paragraph (e)(1) of this clause;
(ii) Disclose any reportable items pursuant to paragraph (e)(2) of this clause;
(iii) Deliver acceptable interim reports pursuant to paragraph (e)(3)(i) of this
clause; or
(iv) Provide the information regarding subcontracts pursuant to paragraph (h)(4)
of this clause.
(2) Such reserve or balance shall be withheld until the Contracting Officer has
determined that the Contractor has rectified whatever deficiencies exist and has
delivered all reports, disclosures, and other information required by this
clause.
(3) Final payment under this contract shall not be made before the Contractor
delivers to
Page I-48 / Revised
<PAGE> 157
SECTION I / REVISED
the Contracting Officer all disclosures of reportable items required by
paragraph (e)(2) of this clause, and an acceptable final report pursuant to
paragraph (e)(3)(ii) of this clause.
(4) The Contracting Officer may decrease or increase the sums withheld up to the
maximum authorized above. No amount shall be withheld under this paragraph while
the amount specified by this paragraph is being withheld under other provisions
of the contract, the withholding of any amount or the subsequent payment thereof
shall not be construed as a waiver of any Government rights.
(h) Subcontracts.
(1) Unless otherwise authorized or directed by the Contracting Officer, the
Contractor shall--
(i) Include this clause (suitably modified to identify the parties) in any
subcontract hereunder (regardless of tier) with other than a small business firm
or nonprofit organization for the performance of experimental, developmental, or
research work; and
(ii) Include the clause at FAR 52.227-11 (suitably modified to identify the
parties) in any subcontract hereunder (regardless of tier) with a small business
firm or nonprofit organization for the performance of experimental,
developmental, or research work.
(2) In the event of a refusal by a prospective subcontractor to accept such a
clause the Contractor--
(i) Shall promptly submit a written notice to the Contracting Officer setting
forth the subcontractor's reasons for such refusal and other pertinent
information that may expedite disposition of the matter; and
(ii) Shall not proceed with such subcontract without the written authorization
of the Contracting Officer.
(3) In the case of subcontracts at any tier, the agency, subcontractor, and
Contractor agree that the mutual obligations of the parties created by this
clause constitute a contract between the subcontractor and NASA with respect to
those matters covered by this clause.
(4) The Contractor shall promptly notify the Contracting Officer in writing upon
the award of any subcontract at any tier containing a patent rights clause by
identifying the subcontractor, the applicable patent rights clause, the work to
be performed under the subcontract, and the dates of award and estimated
completion. Upon request of the Contracting Officer, the Contractor shall
furnish a copy of such subcontract, and, no more frequently than annually, a
listing of the subcontracts that have been awarded.
Page I-49 / Revised
<PAGE> 158
SECTION I / REVISED
(5) The subcontractor will retain all rights provided for the Contractor in the
clause of subparagraph (h)(1)(i) or (ii) of this clause, whichever is included
in the subcontract, and the Contractor will not, as part of the consideration
for awarding the subcontract, obtain rights in the subcontractor's subject
inventions.
(i) Preference for United States industry. Unless provided otherwise, no
Contractor that receives title to any subject invention and no assignee of any
such Contractor shall grant to any person the exclusive right to use or sell any
subject invention in the United States unless such person agrees that any
products embodying the subject invention will be manufactured substantially in
the United States. However, in individual cases, the requirement may be waived
by the Administrator upon a showing by the Contractor or assignee that
reasonable but unsuccessful efforts have been made to grant licenses on similar
terms to potential licensees that would be likely to manufacture substantially
in the United States or that under the circumstances domestic manufacture is not
commercially feasible.
(End of clause)
Page I-50 / Revised
<PAGE> 159
SECTION J / REVISED
PART III - LIST OF DOCUMENTS, EXHIBITS
AND OTHER ATTACHMENTS
--------------------------------------
SECTION J - LIST OF ATTACHMENTS
--------------------------------------
NO.
ATTACHMENT TITLE DATE PAGES
- ---------- ------------------------------- ---------
A. LIST OF INSTALLATION - PROVIDED 01/JUL/99 197
GOVERNMENT PROPERTY
B. LIST OF INSTALLATION - PROVIDED 01/JUL/99 186
GOVERNMENT PROPERTY ASSIGNED
TO DYNACS EMPLOYEES ON SITE
Page J-1 / Revised
<PAGE> 160
<TABLE>
<S> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT 1. CONTRACT ID CODE 1 of 2
- ------------------------------------------------------------------------------------------------------------------------------------
2. AMENDMENT/MODIFICATION NO. 3. EFFECTIVE DATE 4. REQUISITION/PURCHASE REQ.NO. 5. PROJECT NO. (if applicable)
2 May 20, 1999
- ------------------------------------------------------------------------------------------------------------------------------------
6. ISSUED BY CODE 0616/TAS 7. ADMINISTERED BY (IF OTHER THAN ITEM 6) CODE
------------ ------------
NASA Glenn Research Center
Attn: Thomas A Spicer
Services and Construction Branch
21000 Brookpark Road, Mail Stop 500-312
Cleveland, OH 44135-3191
- ------------------------------------------------------------------------------------------------------------------------------------
8. NAME AND ADDRESS OF CONTRACTOR (No., street, county, State and Zip Code) |_| 9A. AMENDMENT OF SOLICITATION NO.
---------------------------------------------
9B. DATED (SEE ITEM 11)
---------------------------------------------
|X| 10A. MODIFICATION OF CONTRACT/ORDER NO.
NAS3-98008
---------------------------------------------
- ---------------------------------------------------------------------------------- 10B. DATED (SEE ITEM 13)
CODE (PF)(9) FACILITY CODE 12-17-97
- ------------------------------------------------------------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS
- ------------------------------------------------------------------------------------------------------------------------------------
|_| The above numbered solicitation is amended as set forth in Item 14. The hour and date specified for receipt of Offers |_| is
extended, |_| is not extended.
Offers must acknowledge receipt of this amendment prior to the hour and date specified in the solicitation or as amended, by one of
the following methods:
(a) By completing Items 8 and 15, and returning ___ copies of the amendment; (b) By acknowledging receipt of this amendment on each
copy of the offer submitted; or (c) By separate letter or telegram which includes a reference to the solicitation and amendment
numbers. FAILURE OF YOUR ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND DATE
SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this amendment you desire to change an offer already submitted,
such change may be made by telegram or letter, provided each telegram or letter makes reference to the solicitation and this
amendment, and is received prior to the opening hour and date specified.
- ------------------------------------------------------------------------------------------------------------------------------------
12. ACCOUNTING AND APPROPRIATION DATA (if required)
N/A
- ------------------------------------------------------------------------------------------------------------------------------------
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIES THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
- ------------------------------------------------------------------------------------------------------------------------------------
|_| A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE
CONTRACT ORDER NO. IN ITEM 10A.
- ------------------------------------------------------------------------------------------------------------------------------------
|_| B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (such as changes in paying
office, appropriation date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR 43.103(b).
- ------------------------------------------------------------------------------------------------------------------------------------
|_| C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
- ------------------------------------------------------------------------------------------------------------------------------------
|X| D. OTHER (Specify type of modification and authority)
B.4 Award Fee Pool (SEPT 97)
- ------------------------------------------------------------------------------------------------------------------------------------
E. IMPORTANT: Contractor |X| is not, |_| is required to sign this document and return __ copies to the issuing office.
- ------------------------------------------------------------------------------------------------------------------------------------
14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings, including solicitation/contract subject matter
where feasible.)
See Page 2
- ------------------------------------------------------------------------------------------------------------------------------------
Except as provided herein, all terms and conditions of the document referenced in Item 9A or 10A, as heretofore changed, remains
unchanged and in full force and effect.
- ------------------------------------------------------------------------------------------------------------------------------------
15A. NAME AND TITLE OF SIGNER (Type or print) 16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)
Thomas A. Spicer, Contracting Officer
- ------------------------------------------------------------------------------------------------------------------------------------
15B. CONTRACTOR/OFFEROR 15C. DATE SIGNED 16B. UNITED STATES OF AMERICA 16C. DATE SIGNED
BY BY /s/ Thomas A. Spicer May 20, 1999
---------------------------------------- ---------------------------------------
(Signature of person authorized to sign) (Signature of Contracting Officer)
- ------------------------------------------------------------------------------------------------------------------------------------
NSN 7540-01-152-8070 30-105 STANDARD FORM 30 (REV. 10-83)
PREVIOUS EDITION UNUSABLE Prescribed by GSA
FAR (48 CFR) 53.243
</TABLE>
DUPLICATE ORIGINAL
<PAGE> 161
NAS3-98008 Modification No. 2 Page 2
The contract is modified to reflect the Award Fee determination for the
evaluation period from from June 1, 1998 through February 28, 1999 as follows:
<TABLE>
<CAPTION>
Prior Amount This Action New Amount
------------ ----------- ----------
<S> <C> <C> <C>
Estimated Cost $42,185,846 -- $42,185,846
Earned Award Fee -- $ 549,755.00 $649,755.00
Potential Award Fee Pool $ 1,371,261 $(676,828.00) $694,433.00
----------- ------------ -----------
TOTAL CONTRACT $43,557,197 $ (27,073.00) $43,530,034
</TABLE>
<PAGE> 1
Exhibit 10.11
WARRANT AND SENIOR SUBORDINATED CONVERTIBLE NOTE
PURCHASE AGREEMENT
WARRANT AND SENIOR SUBORDINATED CONVERTIBLE NOTE PURCHASE AGREEMENT
("Agreement") dated as of November , 1999 among DYNACS ENGINEERING CO., INC., a
Florida corporation (the "Company"), and each person or entity
who executes a counterpart signature page to this Agreement and is listed as an
investor on Schedule I attached to this Agreement (each individually an
"Investor" and collectively the "Investors"). Certain terms are defined in
Section 8.16 hereof.
W I T N E S S E T H:
WHEREAS, the Company desires to sell and issue to the Investors, and
the Investors desire to purchase from the Company, up to an aggregate principal
amount of $1,000,000 of the Company's Senior Subordinated Convertible Promissory
Notes, each in the form of Exhibit A attached hereto (collectively, the
"Notes"), and Warrants in the form of Exhibit B attached hereto (collectively,
the "Warrants") to purchase shares ("Warrant Shares") of common stock of the
Company, par value $.01 per share (the "Common Stock") on the terms and
conditions set forth herein; and
WHEREAS, the Notes and the Warrants (together, the "Securities") are
being sold to the Investors in connection with the Company's October 1999
private placement (the "Offering") of securities consisting of the Notes and
Warrants; and
WHEREAS, the Notes are convertible into shares of Common Stock of the
Company ("Note Shares") upon the occurrence of a Liquidity Event, subject to
certain limitations, at the Conversion Price, or convertible into, or
exchangeable for, Mezzanine Securities (as defined in
<PAGE> 2
the Note), at the election of each holder of a Note if the Company consummates a
Mezzanine Financing (as defined in the Note) after the date of the first
issuance of any Notes; and
WHEREAS, the Warrants are exercisable for shares of Common Stock at the
exercise price set forth in the Warrants; and
WHEREAS, the holders of the Securities have certain registration rights
pertaining to the Note Shares, if any, and Warrant Shares pursuant to the terms
set forth herein and therein;
NOW, THEREFORE, in consideration of the foregoing premises and the
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
ARTICLE I.
PURCHASE AND SALE OF NOTES AND WARRANTS
Section 1.1 Purchase and Sale of Notes and Warrants. Upon the following
terms and conditions, the Company shall issue and sell to each Investor
severally, and not jointly, and each Investor severally, and not jointly, shall
purchase from the Company, the principal amount of Notes and Warrants for the
number of shares of Common Stock indicated next to such Investor's name on
Schedule I attached hereto.
Section 1.2 Purchase Price. The Notes shall be offered in $100,000
denominations (the "Purchase Price"), or fractions thereof at the option of the
Company. Each Investor shall also receive Warrants to purchase 15,000 shares of
Common Stock for each $100,000 in principal amount of Notes purchased by such
Investor.
Section 1.3 Closings. (a) The initial closing of the purchase and sale
of the Notes and Warrants (the "Initial Closing") shall take place at the
offices of Orrick, Herrington & Sutcliffe LLP, at 10:00 a.m., local time, or at
such other time and location as agreed upon by the Company
2
<PAGE> 3
and the Investors following acceptance by the Company of subscriptions
representing not less than $500,000 but no more than $1,000,000 in aggregate
principal amount of Notes on the later of the following: (i) the date on which
the last to be fulfilled or waived of the conditions set forth in Article V
hereof and applicable to the Closing Date (as defined herein) shall be fulfilled
or waived in accordance herewith, and (ii) such other time and place and/or on
such other date as the Investors and the Company may agree. Subsequent Closings,
if any, will be held at such times as are agreed upon by the Company and the
Investors. The date on which the Initial Closing and any subsequent Closing
occurs is referred to herein as a "Closing Date."
(b) On each Closing Date, the Company shall deliver to each Investor
certificates (with the number of and denomination of such certificates
reasonably requested by such Investor) evidencing the Notes and Warrants
purchased hereunder by such Investor or its nominee registered in the name of
such Investor or its nominee or deposit such Notes and Warrants into accounts
designated by such Investor, and such Investor shall deliver to the Company the
Purchase Price for the principal amount of Notes purchased by such Investor
hereunder by wire transfer in immediately available funds to an account
designated in writing by the Company. In addition, each party shall deliver all
documents, instruments and writings required to be delivered by such party
pursuant to this Agreement at or prior to such Closing Date.
ARTICLE II.
REPRESENTATIONS AND WARRANTIES
Section 2.1 Representations and Warranties of the Company. The Company
hereby makes the following representations and warranties to each of the
Investors as of the date hereof and as of the applicable Closing Date for each
Investor.
3
<PAGE> 4
(a) Organization and Qualification; Material Adverse Effect. Each of
the Company and its Subsidiaries (as defined below) is a corporation duly
incorporated and existing in good standing under the laws of its respective
jurisdiction of incorporation and the Company and its Subsidiaries each has the
requisite corporate power to own its properties and to carry on its business as
now being conducted. As indicated on Annex A attached hereto, the Company owns
the percentage indicated thereon of the outstanding capital stock of certain
corporations (collectively, the "Subsidiaries"). Except as indicated on Annex A,
the Company does not have any other direct or indirect subsidiaries. Each of the
Company and the Subsidiaries is duly qualified as a foreign corporation to do
business and is in good standing in every jurisdiction in which the nature of
the business conducted or property owned by it makes such qualification
necessary other than those in which the failure so to qualify would not have a
Material Adverse Effect. "Material Adverse Effect" means any adverse effect on
the business, operations, properties, prospects, or financial condition of the
entity with respect to which such term is used and which is material to such
entity and other entities controlling or controlled by such entity taken as a
whole, and any material adverse effect on the transactions contemplated under
this Agreement or any other agreement or document contemplated hereby or
thereby.
(b) Authorization; Enforcement. (i) The Company has the requisite
corporate power and authority to enter into and perform this Agreement and to
issue the Notes and the Warrants in accordance with the terms hereof, (ii) the
execution and delivery of this Agreement by the Company and the consummation by
it of the transactions contemplated hereby and thereby, including the issuance
of the Notes and the Warrants, have been duly authorized by all necessary
corporate action, and no further consent or authorization of the Company or its
Board of Directors or stockholders is required, (iii) this Agreement has been
duly executed and delivered
4
<PAGE> 5
by the Company, and (iv) this Agreement constitutes the valid and binding
obligation of the Company enforceable against the Company in accordance with its
terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, liquidation or similar laws relating to,
or affecting generally the enforcement of creditors' rights and remedies or by
other equitable principles of general application.
(c) Capitalization. The authorized capital stock of the Company
consists of 10,000,000 shares of Common Stock and no preferred stock; without
giving effect to the Offering, there are 4,768,750 shares of Common Stock issued
and outstanding. All of the outstanding shares of the Common Stock have been
validly issued and are fully paid and non-assessable. There are no preemptive
rights with respect to shares of Common Stock other than the rights of holders
of record of shares of Common Stock of the Company's subsidiary of Cerulean FXs,
Inc. ("Cerulean") as set forth in Section 6 of that certain Exchange Agreement,
dated as of August 13, 1999, by and among the Company, Ramendra P. Singh,
Michael Burns, William Dallas, Jon Feltheimer and Offensive Group Associates,
LP, which preemptive rights have been waived; without giving effect to the
Offering, 5,743,500 shares of Common Stock (including the shares of Common Stock
issued and outstanding and shares of Common Stock issuable upon the exercise of
any outstanding options, warrants or rights or upon the exchange or conversion
of any exchangeable or convertible securities of the Company) are entitled to
registration rights. Without giving effect to the Offering, there are
outstanding options for 350,000 shares of Common Stock, and in addition, the
holders of 20% of the issued and outstanding shares of Cerulean have the right
to convert such shares into 624,750 shares, subject to adjustment, of the
Company's Common Stock, subject to adjustment. In addition, the Company has
agreed to issue to H.C. Wainwright & Co., Inc. ("Wainwright") certain warrants
to
5
<PAGE> 6
purchase shares of Common Stock and other securities of the Company under
certain conditions in connection with the consummation of the Offering (and any
Mezzanine Financing, as defined in the Note) and an initial public offering of
Common Stock of the Company, if any. Except as indicated in this paragraph (c),
there are no other scrip, rights to subscribe to, calls or commitments of any
character whatsoever relating to, or securities or rights exchangeable or
convertible into, any shares of capital stock of the Company, or contracts,
commitments, understandings or arrangements by which the Company is or may
become bound to issue additional shares of capital stock of the Company or
options, warrants, scrip, rights to subscribe to, or commitments to purchase or
acquire, any shares, or securities or rights convertible into shares, of capital
stock of the Company (except as contemplated by this Agreement or disclosed in
the Documents (as defined below)).
(d) Issuance of Common Shares. The Note Shares issuable upon conversion
of the Notes and the Warrant Shares issuable upon exercise of the Warrants are
duly authorized and will be, as of the applicable Closing Date, reserved for
issuance and, upon such conversion in accordance with the terms of the Notes or
such exercise in accordance with the terms of the Warrants, as the case may be,
such Note Shares and Warrant Shares will be validly issued, fully paid and
non-assessable, free and clear of any and all liens, claims and encumbrances,
and the holders of such Note Shares and Warrant Shares, as the case may be,
shall be entitled to all rights and preferences accorded to a holder of Common
Stock.
(e) No Conflicts. The execution, delivery and performance of this
Agreement by the Company and the consummation by the Company of the transactions
contemplated hereby and thereby do not and will not (i) result in a violation of
the charter or bylaws of the Company or any of the Subsidiaries or (ii) conflict
with, or constitute a default (or an event which with notice
6
<PAGE> 7
or lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation of, any
agreement, indenture, patent, patent license or instrument to which the Company
or any of the Subsidiaries is a party, or result in a violation of any federal,
state, local or foreign law, rule, regulation, order, judgment or decree
(including Federal and state securities laws and regulations) applicable to the
Company or any of the Subsidiaries or by which any property or asset of the
Company or any of the Subsidiaries is bound or affected (except for such
conflicts, defaults, terminations, amendments, accelerations, cancellations and
violations as would not, individually or in the aggregate, have a Material
Adverse Effect); provided that, for purposes of such representation as to
Federal, state, local or foreign law, rule or regulation, no representation is
made herein with respect to any of the same applicable solely to the Investors
and not to the Company or any of the Subsidiaries. Neither the business of the
Company nor of any of the Subsidiaries is being conducted in violation of any
law, ordinance or regulation of any governmental entity, except for violations
which either singly or in the aggregate do not and will not have a Material
Adverse Effect. The Company is not required under Federal, state, local or
foreign law, rule or regulation to obtain any consent, authorization or order
of, or to make any filing or registration with, any court or governmental agency
in order for it to execute, deliver or perform any of its obligations under this
Agreement or issue and sell the Notes or the Warrants in accordance with the
terms hereof and issue the Note Shares upon conversion of the Notes or the
Warrant Shares upon exercise of the Warrants, except for the registration
provisions provided for herein, provided that, for purposes of the
representation made in this sentence, the Company is assuming and relying upon
the accuracy of the relevant representations and agreements of the Investors
herein.
7
<PAGE> 8
(f) Documents; Financial Statements. The Company has delivered or made
available to the Investors true and complete copies of the Confidential Offering
Memorandum dated October 1999 (as amended or supplemented) which includes the
Term Sheet, the October 22, 1999 draft of the Company's Registration Statement
on Form S-1, the forms of Note, Warrant and the Warrant and Senior Subordinated
Convertible Note Purchase Agreement (collectively, the "Documents").
(g) No Material Adverse Change. Since June 30, 1999, no event which had
or is likely to have a Material Adverse Effect has occurred or exists with
respect to the Company or any of the Subsidiaries, except with respect to the
costs and expenses of certain employment litigation or proceedings (of
approximately $200,000) (the "Employment Litigation") and the Arbitration
Proceedings and except as otherwise disclosed or reflected in the Documents.
Notwithstanding the foregoing, the financial summary included in the Documents
compiled from the unaudited financial statements for the six-month period ended
June 30, 1999 reflect a loss of $549,000 and, accordingly, as of June 30, 1999,
the Company had a working capital deficit of $2,252,838.00.
(h) No Undisclosed Liabilities. Neither the Company nor any of its
Subsidiaries has any liabilities or obligations not disclosed in the Documents,
other than those liabilities incurred in the ordinary course of its respective
business since June 30, 1999, liabilities with respect to the Employment
Litigation and the ongoing Arbitration Proceedings or liabilities or
obligations, which, individually or in the aggregate, do not or would not have a
Material Adverse Effect on the Company and the Subsidiaries, taken as a whole.
(i) No General Solicitation. None of the Company, any of the
Subsidiaries nor, to the Company's knowledge, any of their respective affiliates
or any person acting on its or their
8
<PAGE> 9
behalf has engaged in any form of general solicitation or general advertising
(within the meaning of Regulation D) in connection with the offer or sale of the
Notes and the Warrants.
(j) No Integrated Offering. None of the Company, any of the
Subsidiaries, or, to the Company's knowledge, any of their respective
affiliates, or any person acting on its or their behalf has, directly or
indirectly, made any offers or sales of any security or solicited any offers to
buy any security, under circumstances that would require registration of the
Notes or the Warrants.
(k) Intellectual Property. Each of the Company and the Subsidiaries
owns or has licenses to use certain patents, copyrights and trademarks
("intellectual property") associated with its respective business. Each of the
Company and the Subsidiaries has all intellectual property rights which the
Company reasonably believes are needed to conduct its business as it is now
being conducted or as proposed to be conducted as disclosed in the Documents.
The Company has no reason to believe that the intellectual property rights owned
by the Company or any of the Subsidiaries are invalid or unenforceable or that
the use of such intellectual property by the Company or any of the Subsidiaries
infringes upon or conflicts with any right of any third party, and neither the
Company nor any of the Subsidiaries has received notice of any such infringement
or conflict. Except in connection with the Arbitration Proceedings, the Company
has no knowledge of any infringement of the Company's or any of the
Subsidiaries' intellectual property by any third party.
(l) No Litigation. Except with respect to the Arbitration Proceedings
or as set forth in the Documents delivered to the Investors prior to the date of
this Agreement, no litigation or claim (including those for unpaid taxes)
against the Company or any of the Subsidiaries is pending or, to the Company's
knowledge, threatened, and no other event has occurred, which if
9
<PAGE> 10
determined adversely would have a Material Adverse Effect on the Company or the
Subsidiaries, taken as a whole, or would materially adversely effect the
transactions contemplated hereby.
(m) Brokers. The Company has taken no action which would give rise to
any claim by any person, other than Wainwright, for brokerage commissions,
finder's fees or similar payments by any Investor relating to this Agreement or
the transactions contemplated hereby.
(n) Unsecured Obligations; Subordination. The Notes and the amounts
payable thereunder, including principal and accrued interest, are unsecured
obligations of the Company, and shall be subordinate and junior to indebtedness
incurred by the Company pursuant to (i) currently existing equipment financings,
(ii) currently existing debt of $585,000 secured by certain revenues pursuant to
a Loan Agreement dated May 10, 1999; and (iii) up to an aggregate of $6,000,000
of indebtedness of the Company presently existing or hereinafter incurred by the
Company under a working capital facility with First National Bank of Florida, or
the renewal, modification, refinancing or replacement thereof with a financial
institution, bank or commercial lender. Except as set forth in the preceding
sentence, the Notes shall not be subordinate or junior to any other indebtedness
of the Company.
Section 2.2 Representations and Warranties of the Investors. Each of
the Investors, severally, and not jointly, hereby makes the following
representations and warranties to the Company as of the date hereof and on the
applicable Closing Date of such Investor.
(a) Authorization; Enforcement. (i) Such Investor has the requisite
power and authority to enter into and perform this Agreement and to purchase the
Notes and the Warrants being sold hereunder, (ii) the execution and delivery of
this Agreement by such Investor and the consummation by it of the transactions
contemplated hereby and thereby have been duly authorized by all necessary
corporate, company or partnership action, as required, and (iii) this
10
<PAGE> 11
Agreement constitutes the valid and binding obligation of such Investor
enforceable against such Investor in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation or similar laws relating to, or
affecting generally the enforcement of creditors' rights and remedies or by
other equitable principles of general application.
(b) No Conflicts. The execution, delivery and performance of this
Agreement and the consummation by such Investor of the transactions contemplated
hereby and thereby do not and will not (i) result in a violation of such
Investor's organizational documents, or (ii) conflict with any agreement,
indenture, or instrument to which such Investor is a party, or (iii) result in a
violation of any law, rule, or regulation or any order, judgment or decree of
any court or governmental agency applicable to such Investor. Such Investor is
not required to obtain any consent or authorization of any governmental agency
in order for it to perform its obligations under this Agreement.
(c) Investment Representation. Such Investor is purchasing the Notes
and the Warrants for its own account and not with a view to distribution in
violation of any securities laws. Such Investor has no present intention to sell
the Notes or the Warrants and such Investor has no present arrangement (whether
or not legally binding) to sell the Notes or the Warrants to or through any
person or entity; provided, however, that by the representations herein, such
Investor does not agree to hold the Notes or the Warrants for any minimum or
other specific term and reserves the right to dispose of the Notes or the
Warrants at any time in accordance with Federal and state securities laws
applicable to such disposition and the terms of the Notes and Warrants,
respectively.
11
<PAGE> 12
(d) Accredited Investor. Such Investor is an "accredited investor" as
defined in Rule 501 promulgated under the Act. Such Investor has such knowledge
and experience in financial and business matters in general and investments in
particular, so that such Investor is able to evaluate the merits and risks of an
investment in the Notes and the Warrants and to protect its own interests in
connection with such investment. In addition (but without limiting the effect of
the Company's representations and warranties contained herein), such Investor
has received such information as it considers necessary or appropriate for
deciding whether to purchase the Notes and the Warrants pursuant hereto.
(e) Rule 144. Such Investor understands that: (i) there is no public
trading market for the Notes, the Warrants, the Note Shares, the Warrant Shares
or the Mezzanine Securities and that none is expected to develop; (ii) the Notes
must be held until repaid in full unless the Notes are converted, if
permissible, or registered under the Securities Act or an exemption from such
registration is available; (iii) the Warrants must be held indefinitely unless
the Warrants are exercised or are registered under the Securities Act or an
exemption from such registration is available; and (iv) the Warrant Shares and
the Note Shares must be held indefinitely unless such Warrant Shares or the Note
Shares, as the case may be, are registered under the Securities Act or an
exemption from such registration is available. Such Investor has been advised or
is aware of the provisions of Rule 144 promulgated under the Securities Act.
(f) Brokers. Such Investor has taken no action which would give rise to
any claim by any person for brokerage commissions, finder's fees or similar
payments by the Company relating to this Agreement or the transactions
contemplated hereby.
(g) Reliance by the Company. Such Investor understands that the Notes
and the Warrants are being offered and sold in reliance on a transactional
exemption from the registration
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requirements of Federal and state securities laws and that the Company is
relying upon the truth and accuracy of the representations, warranties,
agreements, acknowledgments and understandings of such Investor set forth herein
in order to determine the applicability of such exemption and the suitability of
such Investor to acquire the Notes and the Warrants.
ARTICLE III.
COVENANTS
Section 3.1 Certificates on Conversion and Exercise.
(a) Certificates on Conversion. Upon any conversion of the Notes, the
Company shall issue and deliver to such Investor (or the then holder) within
three (3) days of the Conversion Date (as defined in the Notes) certificates for
Note Shares in accordance with the terms of the Note.
(b) Certificates upon Exercise. Upon any exercise of the Warrants, the
Company shall issue and deliver to the then holder, as soon as practicable after
each such exercise of any Warrant, a certificate or certificates for the Warrant
Shares issuable upon such exercise, registered in the name of such holder or its
designee. If any Warrant should be exercised in part only, the Company shall,
upon surrender of such Warrant for cancellation, execute and deliver a new
Warrant evidencing the right of the holder to purchase the remaining unexercised
balance of the Warrant Shares (or portions thereof) subject to purchase under
the Warrant.
Section 3.2 Replacement Certificates. The certificate(s) representing
the Notes held by any Investor (or then holder) may be exchanged by such
Investor (or such holder) at any time and from time to time for certificates
with different denominations representing an equal aggregate principal amount of
Notes, as reasonably requested by such Investor (or such holder) upon
surrendering the same. The warrant certificate(s) representing the Warrants held
by any Investor
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(or then holder) may be exchanged by such Investor (or such holder) at any time
and from time to time for certificates exercisable for an equal aggregate number
of Warrant Shares, as reasonably requested by such Investor (or such holder)
upon surrendering the same. No service charge will be made for such
registration, transfer or exchange.
Section 3.3 Securities Compliance. The Company shall take all necessary
action and proceedings as may be required and permitted by applicable law, rule
and regulation, for the legal and valid issuance of the Notes and the Warrants
hereunder and the Note Shares issuable upon conversion of the Notes and the
Warrant Shares issuable upon exercise of the Warrants.
Section 3.4 Notices. The Company agrees to provide all holders of Notes
and/or Note Shares and Warrants and/or Warrant Shares with copies of all notices
and information, including without limitation notices and proxy statements in
connection with any meetings, that are provided to the holders of shares of
Common Stock, contemporaneously with the delivery of such notices or information
to such Common Stock holders.
Section 3.5 Reservation of Stock Issuable Upon Conversion or Exercise.
The Company shall at all times reserve and keep available out of its authorized
but unissued Common Stock, solely for the purpose of affecting the conversion of
the Notes and/or the exercise of the Warrants, such number of shares of its
Common Stock as shall from time to time be sufficient to effect the conversion
of all outstanding Notes and the exercise of all outstanding Warrants, and if,
at any time, the number of authorized but unissued shares of Common Stock shall
not be sufficient to effect the conversion of all the then outstanding Notes and
the exercise of all then outstanding Warrants, the Company shall take such
corporate action as may, in the opinion of its counsel, be necessary to increase
its authorized but unissued Common Stock to such number of
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shares as shall be sufficient for such purpose, including without limitation
engaging in commercially reasonable efforts to obtain the requisite shareholder
approval.
Section 3.6 Financial Statements and Reports. The Company shall provide
the Investors and holders of the Notes and/or Note Shares and the Warrants
and/or Warrant Shares, as the case may be, copies of all quarterly and audited
annual financial statements prepared by or on behalf of the Company, other
reports prepared by or on behalf of the Company for public disclosure and all
documents delivered to the Company's stockholders until the Notes have been
discharged in full through repayment and/or conversion and the Warrants have
been exercised and all of the Note Shares, if any, and the Warrant Shares, if
any, have been registered under the Securities Act.
Section 3.7 Use of Proceeds. The Company shall use the net proceeds of
the Offering for working capital. The Company shall not use any of the net
proceeds to repay any unsecured indebtedness for borrowed money of the Company.
ARTICLE IV.
REGISTRATION
Section 4.1 Piggyback Registration. If, at any time during the
five-year period commencing six (6) months after the Company initially becomes
subject to the reporting requirements of Section 13 or Section 15(g) under the
Exchange Act, the Company proposes to register any of its securities under the
Securities Act (other than in connection with the Company's initial public
offering, a transaction contemplated by Rule 145(a) promulgated under the
Securities Act or pursuant to Forms S-8 or S-4 or successor forms) it will give
written notice by registered or certified mail, at least thirty (30) days prior
to the filing of each such registration statement, to the holder(s) of the
Registrable Securities of its intention to do so. Upon the written
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request of any such holder given within ten (10) days after receipt of any such
notice of his desire to include any Registrable Securities in such proposed
registration statement, the Company shall afford such holder the opportunity to
have any such Registrable Securities registered under such registration
statement.
Notwithstanding the provisions of this Section 4.1, the Company shall
have the right at any time after it shall have given written notice pursuant to
this Section 4.1 (irrespective of whether a written request for inclusion of any
such securities shall have been made) to elect not to file any such proposed
registration statement, or to withdraw the same after the filing but prior to
the effective date thereof.
If any registration pursuant to this Section 4.1 shall be underwritten
in whole or in part, the Company may require that the Registrable Securities
requested for inclusion pursuant to this Section 4.1 be included in the
underwriting on the same terms and conditions as the securities otherwise being
sold through the underwriter(s), and then only in such quantity as will not, in
the opinion of the underwriters, jeopardize the success of the underwritten
public offering by the Company. In the case of a (i) primary registration
statement on behalf of the Company or (ii) secondary registration statement on
behalf of holders of securities of the Company exercising a right to request or
demand registration, if in the opinion of the managing underwriter the
registration of the number of Registrable Securities that the holders have
requested to be registered would adversely affect such public offering, then the
Company shall be required to include in the underwriting only that number of
Registrable Securities, in addition to all of the shares to be sold by the
Company, or any other stockholders of the Company that the managing underwriter
believes may be sold without causing such adverse effect. The shares to be so
included shall be, first, the shares the Company proposes to sell, in a primary
offering, or the
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securities requested to be included therein by holders requesting such
registration pursuant to a demand registration or an unfulfilled automatic right
to registration in the case of a secondary registration, and, second, shares
which have piggy-back rights. If less than all shares in either class are to be
registered by reason of the managing underwriter's cutback, shares within such
class shall be allowed to participate in such underwriting on a pro rata basis
based upon the number of securities requested to be included by each
participating shareholder.
Section 4.2 Demand Registration. (a) At any time during the five-year
period commencing six (6) months after the Company initially becomes subject to
the reporting requirements of Section 13 or Section 15(g) under the Exchange
Act, the holders of a Majority of the Registrable Securities shall have the
right (which right is in addition to the registration rights under Section 4.1
hereof), exercisable by written notice to the Company, to have the Company
prepare and file with the Commission, on one occasion, a registration statement
and such other documents, including a prospectus, as may be necessary in the
opinion of both counsel for the Company and counsel for the underwriter, if any,
and such holders, in order to comply with the provisions of the Securities Act,
so as to permit a public offering and sale of their respective Registrable
Securities for nine (9) consecutive months by such holders and any other holders
of Registrable Securities who notify the Company within ten (10) days after
receiving notice from the Company of such request, provided, that the Company is
subject to the reporting requirements of the Exchange Act at the time of the
written notice to the Company.
(b) The Company covenants and agrees to give written notice of any
registration request under this Section 4.2 by any holder or holders to all
other registered holders of the Notes and/or Note Shares and Warrants and
Warrant Shares within ten (10) days of the receipt of any such registration
request.
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Section 4.3 Covenants of the Company With Respect to Registration. In
connection with any registration under Section 4.1 or 4.2 hereof, the Company
covenants and agrees as follows: (a) to use commercially reasonable efforts to
file a registration statement within forty-five (45) days of receipt of any
demand therefor and to cause any registration statement to be declared effective
at the earliest possible time. The Company shall furnish each holder desiring to
sell Registrable Securities such number of prospectuses as shall reasonably be
requested;
(b) to pay all costs (excluding transfer taxes, if any, and any
underwriting or selling commissions), fees and expenses in connection with all
registration statements filed pursuant to Section 4.1 or 4.2 hereof including,
without limitation, the Company's legal and accounting fees, printing expenses
and blue sky fees and expenses;
(c) as expeditiously as possible, to prepare and file with the
Commission any amendments and supplements to the registration statement and the
prospectus included in the registration statement as may be necessary to keep
the registration statement effective, in the case of a firm commitment
underwritten public offering, until each underwriter has completed the
distribution of all securities purchased by it and, in the case of any other
offering, until the earlier of the sale of all Registrable Securities covered
thereby or two hundred seventy (270) days after the effective date thereof;
(d) as expeditiously as possible, to furnish to the Seller such
reasonable numbers of copies of the prospectus, including a preliminary
prospectus, in conformity with the requirements of the Securities Act, and such
other documents as the Seller may reasonably request in order to facilitate the
public sale or other disposition of the Registrable Securities owned by him;
(e) as expeditiously as possible, to use its commercially reasonable
efforts to register or qualify the Registrable Securities covered by the
registration statement under the securities or
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blue sky laws of such states as Seller shall reasonably request, and do any and
all other acts and things that may be necessary or desirable to enable Seller to
consummate the public sale or other disposition in such states of the
Registrable Securities owned by Seller; provided, however, that the Company
shall not be required in connection with this subsection (e) to qualify as a
foreign corporation in any jurisdiction in which it is not already obligated to
qualify or execute or file a general consent to service of process in any
jurisdiction;
(f) if the registration statement relates to an underwritten offering,
to enter into and perform its obligations under an underwriting agreement in the
usual and customary form, including without limitation, customary
indemnification and contribution obligations with the underwriter's
representative;
(g) to notify the Seller at any time when a prospectus relating to
Registrable Securities covered by the registration statement is effective, of
the happening of any event as a result of which the prospectus included in the
registration statement, as then in effect, includes an untrue statement of a
material fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing. The Company shall use commercially reasonable
efforts promptly to amend or supplement the registration statement to correct
any such untrue statement or omission;
(h) to notify the Seller of the issuance by the Commission of any stop
order suspending the effectiveness of the registration statement or the
initiation of any proceedings for that purpose. The Company will make every
commercially reasonable effort to prevent the issuance of any stop order and, if
any stop order is issued, to obtain the lifting thereof at the earliest possible
time;
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(i) if the Company has delivered preliminary or final prospectuses to
the Seller and after having done so the prospectus is amended to comply with the
provisions of the Securities Act or is amended or supplemented, the Company
shall promptly notify the Seller. In that case, the Sellers shall immediately
cease making offers of Registrable Securities and, if requested, return all
prospectuses to the Company. The Company shall promptly provide the Seller with
revised prospectuses and, following receipt of the revised prospectuses, Seller
shall be free to resume making offers of the Registrable Securities.
(j) permit a single firm of counsel, designated as Holders' counsel by
the Holders of a majority of the Registrable Securities included in the
Registration Statement, to review the Registration Statement and all amendments
and supplements thereto within a reasonable period of time prior to each filing,
and shall not file any document in a form to which such counsel reasonably
objects.
(k) the Company shall make available for inspection by the Holders,
representative(s) of all the Holders together, any underwriter participating in
any disposition pursuant to a Registration Statement, and any attorney or
accountant retained by any Holder or underwriter, all financial and other
records customary for purposes of the Holders' due diligence examination of the
Company, pertinent corporate documents and properties of the Company, and cause
the Company's officers, directors and employees to supply all information
reasonably requested by any such representative, underwriter, attorney or
accountant in connection with such Registration Statement, provided that such
parties agree to keep such information confidential.
(l) In the event that the Company registers any of the Registrable
Securities under the Securities Act, the Company will indemnify and hold
harmless each of the Sellers and each underwriter of the Registrable Securities
registered (including any broker or dealer through
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whom such shares may be sold pursuant to the applicable underwriting agreement)
and their respective officers, directors, affiliates and partners and each
Person (as defined below), if any, who controls such Seller or any such
underwriter within the meaning of Section 15 of the Securities Act, from and
against any and all losses, claims, damages, expenses or liabilities, joint or
several, to which they or any of them become subject under the Securities Act,
applicable state securities laws or under any other statute or at common law or
otherwise, as incurred, and, except as hereinafter provided, will reimburse each
such Seller, each such underwriter and each such controlling Person, if any, for
any legal or other expenses reasonably incurred by them or any of them in
connection with investigating or defending any actions whether or not resulting
in any liability, as incurred, insofar as such losses, claims, damages,
expenses, liabilities or actions arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the
registration statement, in any preliminary or amended preliminary prospectus or
in the final prospectus (or the registration statement or prospectus as from
time to time amended or supplemented by the Company), in any application or
other document executed by the Company or based upon information furnished by
the Company filed in any jurisdiction in order to qualify the securities under
the securities laws thereof or filed with the Commission, the National
Association of Securities Dealers, Inc., the Nasdaq Stock Market or any
exchange, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary in
order to make the statements therein not misleading, or any violation by the
Company of any rule or regulation promulgated under the Securities Act or any
state securities laws applicable to the Company and relating to action or
inaction required of the Company in connection with such registration, unless
(i) such untrue statement or alleged untrue statement or omission or alleged
omission was made in such registration statement,
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preliminary or amended preliminary prospectus or final prospectus or application
or document in reliance upon and in conformity with information furnished in
writing to the Company in connection therewith by any such holder of Registrable
Securities or its controlling person (in the case of indemnification of such
Holder or its controlling person), or any such underwriter or its controlling
person (in the case of indemnification of such underwriter or its controlling
person) expressly for use therein, or unless (ii) in the case of a sale directly
by such Seller (including a sale of such Registrable Securities through any
underwriter retained by such holder of Registrable Securities to engage in a
distribution on behalf of such holder), such untrue statement or alleged untrue
statement or omission or alleged omission was contained in a preliminary
prospectus and corrected in a final or amended prospectus copies of which were
delivered to such Seller or such underwriter on a timely basis, and such Seller
failed to deliver a copy of the final or amended prospectus at or prior to the
confirmation for the sale of the Registrable Securities to the person asserting
any such loss, claim, damage or liability in any case where such delivery is
required by the Securities Act.
The term "Person," as used in this Section, shall mean an individual,
corporation, partnership, trust, university, unincorporated organization, or
other entity.
Promptly after receipt by any Seller, any underwriter or any
controlling Person of notice of the commencement of any action in respect of
which indemnity may be sought against the Company, such Seller, or such
underwriter or such controlling person, as the case may be, will notify the
Company in writing of the commencement thereof (provided, that failure to so
notify the Company shall not relieve the Company from any liability it may have
hereunder, except to the extent that the Company's defense of such action was
materially adversely affected thereby) and, subject to the provisions
hereinafter stated, the Company shall assume the defense of such
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action (including the employment of counsel, who shall be counsel reasonably
satisfactory to such Seller, of such underwriter or such controlling Person, as
the case may be), and shall assume the payment of expenses insofar as such
action shall relate to any alleged liability in respect of which indemnity may
be sought against the Company.
Such Seller, any such underwriter or any such controlling Person shall
have the right to employ separate counsel in any such action and to participate
in the defense thereof but the fees and expenses of such counsel subsequent to
any assumption of the defense by the Company shall not be at the expense of the
Company unless the employment of such counsel has been specifically authorized
in writing by the Company, the Company shall not have employed counsel to defend
such action or such indemnified party or parties shall have reasonably concluded
that there may be defenses available to it or them which are different from or
additional to those available to the Company (in which case the Company shall
not have the right to direct the defense of such action on behalf of the
indemnified party or parties) in any of which events the fees and expenses of
not more than one additional firm of attorneys for the Seller(s) and/or such
underwriter or controlling person shall be borne by the Company. The Company
shall not be liable to indemnify any Person for any settlement of any such
action effected without the Company's written consent. The Company shall not,
except with the approval of each party being indemnified under this paragraph
4.3(j), consent to entry of any judgment or enter into any settlement which does
not include as an unconditional term thereof the giving by the claimant or
plaintiff to the parties being so indemnified of a release from all liability in
respect to such claim or litigation.
In order to provide for just and equitable contribution to joint
liability under the Securities Act in any case in which any participating holder
exercising rights under this Article 4,
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or any controlling Person of any such Seller, makes a claim for indemnification
pursuant to this Section 4.3(j) but it is judicially determined (by the entry of
a final judgment or decree by a court of competent jurisdiction and the
expiration of time to appeal or the denial of the last right of appeal) that
such indemnification may not be enforced in such case notwithstanding the fact
that this Section 4.3(j) provides for indemnification in such case, then, the
Company and such holder will contribute to the aggregate losses, claims, damages
or liabilities to which they may be subject (after contribution from others) in
such proportion as is appropriate to reflect the relative fault of the Company
on the one hand and of the holder on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative fault of the
Company on the one hand and of the Seller on the other shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or omission or alleged omission to state a material fact
relates to information supplied by the Company on the one hand or by the Seller
on the other, and each party's relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission; provided,
however, that, in any such case, (A) no such Seller will be required to
contribute any amount in excess of the public offering price of all such
Registrable Securities offered by such Seller pursuant to such registration
statement; and (B) no person or entity guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) will be entitled to
contribution from any person or entity who was not guilty of such fraudulent
misrepresentation.
(m) If the Company at any time shall list any class of equity
securities on any national securities exchange and shall register such class of
equity securities under the Exchange Act, the Company shall, at its expense,
simultaneously list on such exchange and maintain such listing of,
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the Warrant Shares and the Note Shares. The Company shall use commercially
reasonable efforts to timely file with the Commission such information as the
Commission may require under Section 13 or Section 15(d) of the Exchange Act;
and in such event, the Company shall use commercially reasonable efforts to take
all action as may be required as a condition to the availability of Rule 144 or
Rule 144A under the Securities Act (or any successor exemptive rule hereinafter
in effect) with respect to such Registrable Securities. The Company shall
furnish to any Seller forthwith upon request (i) a written statement by the
Company as to its compliance with the reporting requirements of Rule 144, (ii) a
copy of the most recent annual or quarterly report of the Company as filed with
the Commission, and (iii) such other reports and documents as a Seller may
reasonably request in availing itself of any rule or regulation of the
Commission allowing a Seller to sell any such Registrable Securities without
registration. The Company agrees to use commercially reasonable efforts to
facilitate and expedite transfers of Registrable Securities pursuant to Rule 144
under the Securities Act, which efforts shall include timely notice to its
transfer agent to expedite such transfers of Common Stock. Section 4.4
Indemnification by Sellers. In the event that the Company registers any of the
Registrable Securities under the Securities Act, each Seller of Registrable
Securities so registered shall indemnify and hold harmless the Company, each of
its directors, each of its officers who have signed or otherwise participated in
the preparation of the registration statement, each underwriter of the
Registrable Securities so registered (including any broker or dealer through
whom such of the shares may be sold) and each Person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act, from and against
any and all losses, claims, damages, expenses or liabilities, joint or several,
to which they or any of them may become subject under the Securities Act,
applicable state securities laws or under any other statute or at
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common law or otherwise, and, except as hereinafter provided, shall reimburse
the Company and each such director, officer, underwriter, broker, dealer or
controlling Person for any legal or other expenses reasonably incurred by them
or any of them in connection with investigating or defending any actions whether
or not resulting in any liability, insofar as such losses, claims, damages,
expenses, liabilities or actions arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the
registration statement, in any preliminary or amended preliminary prospectus or
in the final prospectus (or in the registration statement or prospectus as from
time to time amended or supplemented) or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary in order to make the statements therein not
misleading, but only insofar as any such statement or omission was made in
reliance upon and in conformity with information furnished in writing to the
Company in connection therewith by such Holder expressly for use therein;
provided, however, that such Seller's obligations hereunder shall be limited to
an amount equal to the proceeds received by such Seller sold in such
registration.
Promptly after receipt of notice of the commencement of any action in
respect of which indemnity may be sought against such Holder, the Company will
notify such Seller in writing of the commencement thereof (provided, that
failure to so notify such Seller shall not relieve such Seller from any
liability it may have hereunder, except to the extent such Seller's defense of
such action was materially adversely affected thereby), and such Seller shall,
subject to the provisions hereinafter stated, be entitled to assume the defense
of such action (including the employment of counsel, who shall be counsel
reasonably satisfactory to the Company) and the payment of expenses insofar as
such action shall relate to the alleged liability in respect of which indemnity
may be sought against such holder of Registrable Securities. The Company and
each such
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director, officer, underwriter or controlling Person shall have the
right to employ separate counsel in any such action and to participate in the
defense thereof, but the fees and expenses of such counsel subsequent to any
assumption of the defense by such Seller shall not be at the expense of such
Seller unless engagement of such counsel is specifically authorized in writing
by such Seller. Such Seller shall not be liable to indemnify any Person for any
settlement of any such action effected without such Seller's written consent.
In order to provide for just and equitable contribution to joint
liability under the Securities Act in any case in which the Company's exercise
of its rights under this Section 4.4 makes a claim for indemnification pursuant
to this Section 4.4, but it is judicially determined (by the entry of a final
judgment or decree by a court of competent jurisdiction and the expiration of
time to appeal or the denial of the last right of appeal) that such
indemnification may not be enforced in such case notwithstanding that this
Section 4.4 provides for indemnification, in such case, then, the Company and
such Seller will contribute to the aggregate losses, claims, damages or
liabilities to which they may be subject (after contribution from others) in
such proportion as is appropriate to reflect the relative fault of the Company
on the one hand and of the Seller on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative fault of the
Company on the one hand and of the Seller on the other shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or omission or alleged omission to state a material fact
relates to information supplied by the Company on the one hand or by the Seller
on the other, and each party's relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission; provided,
however, that, in any such case, (i) no such Seller will be required to
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contribute any amount in excess of the public offering price of all such
Registrable Securities offered by it pursuant to such registration statement;
and (ii) no person or entity guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) will be entitled to contribution
from any person or entity who was not guilty of such fraudulent
misrepresentation.
Section 4.5 Stockholder Acts. Whenever under the preceding Sections of
this Article IV any Holder is registering any Registrable Securities pursuant to
any registration statement, each such Holder agrees to timely provide to the
Company, at its request, such information and materials as the Company may
reasonably request in order to effect the registration of such Registrable
Securities.
Section 4.6 Assignment of Registration Rights. The rights to cause the
Company to register Registrable Securities pursuant to this Article IV may be
assigned (but only with all related obligations) by an Investor to a transferee
or assignee, provided that: (a) the Company is, within a reasonable time before
such transfer, furnished with written notice of the name and address of such
transferee or assignee and the securities with respect to which such
registration rights are being assigned; (b) such assignment shall be effective
only if immediately following such transfer the further disposition of such
securities by the transferee or assignee is restricted under the Securities Act;
(c) the assignee, in the Company's judgment, is not a competitor of the Company
or any of its subsidiaries; and (d) such assignment is not otherwise prohibited
by the terms of any lock-up agreement then in effect with respect to the
Warrants, the Notes or the Registrable Securities.
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Section 4.7 Delay of Registration. No Holder shall have any right to
obtain or seek an injunction restraining or otherwise delaying any registration
as the result of any controversy that might arise with respect to the
interpretation or implementation of this Article IV.
Section 4.8 No Required Exercise or Conversion. Nothing contained in
this Agreement shall be construed as requiring the Investors or the holder(s) to
convert the Notes or exercise the Warrants, as the case may be, prior to the
initial filing of any registration statement or the effectiveness thereof.
Section 4.9 Investor Compensation of Underwriter. In connection with
any registration made pursuant to Section 4.1 or 4.2 hereof, the holder(s) of
Registrable Securities agree(s) as follows: (a) any public sale of Registrable
Securities included in the related registration statement shall be effected
through the underwriter, if any, for such registration and (b) such holder(s)
shall compensate the underwriter in accordance with its customary compensation
practices for such transactions.
ARTICLE V.
CONDITIONS
Section 5.1 Conditions Precedent to the Obligation of the Company to
Issue the Notes. The obligation hereunder of the Company to issue the Notes and
the Warrants to the Investors is subject to the satisfaction, at or before the
applicable Closing Date, of each of the conditions set forth below. These
conditions are for the Company's sole benefit and may be waived by the Company
at any time in its sole discretion.
(a) Accuracy of the Investors' Representations and Warranties. The
representations and warranties of each Investor shall be true and correct in all
material respects as of the date
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<PAGE> 30
when made and as of such Closing Date as though made at that time (except for
representations and warranties that speak as of a particular date).
(b) Performance by the Investors. Each Investor shall have performed
all agreements and satisfied all conditions required to be performed or
satisfied by such Investor at or prior to such Closing Date.
(c) No Injunction. No statute, rule, regulation, executive order,
decree, ruling or injunction shall have been enacted, entered, promulgated or
endorsed by any court or governmental authority of competent jurisdiction which
prohibits the consummation of any of the transactions contemplated by this
Agreement.
Section 5.2 Conditions Precedent to the Obligation of the Investors to
Purchase the Notes and the Warrants. The obligation hereunder of each Investor
to acquire and pay for the Notes and the Warrants is subject to the
satisfaction, at or before the applicable Closing Date, of each of the
conditions set forth below. These conditions are for the Investors' sole benefit
and may be waived by the Investors at any time in their sole discretion.
(a) Accuracy of the Company's Representations and Warranties. The
representation and warranties of the Company shall be true and correct in all
material respects as of the date when made and as of such Closing Date as though
made at that time (except for representations and warranties that speak as of a
particular date).
(b) Performance by the Company. The Company shall have performed all
agreements and satisfied all conditions required to be performed or satisfied by
the Company at or prior to such Closing Date.
(c) No Injunction. No statute, rule, regulation, executive order,
decree, ruling or injunction shall have been enacted, entered, promulgated or
endorsed by any court or
30
<PAGE> 31
governmental authority or competent jurisdiction which prohibits the
consummation of any of the transactions contemplated by this Agreement.
(d) Opinion of Counsel. At such Closing Date, the Investors shall have
received an opinion of counsel to the Company in form substantially similar to
the opinion attached hereto as Exhibit C and such other opinions, certificates
and documents as the Investors or their counsel shall reasonably require prior
to or at the Closing.
(e) Minimum Subscription. In connection with the date of the Initial
Closing (the "Initial Closing Date"), Notes in the aggregate principal amount of
$500,000 shall have been purchased by the Investors pursuant to this Agreement.
(f) Secretary's Certificate. The Company shall have delivered to the
Investors a certificate in form and substance reasonably satisfactory to the
Investors, executed by the Secretary of the Company on behalf of the Company,
certifying as to satisfaction of closing conditions, incumbency of signing
officers, charter, by-laws, good standing and authorizing resolutions of the
Company.
(g) Ramendra Singh Guaranty. Ramendra Singh, the holder of over 50% of
the issued and outstanding shares of Common Stock of the Company at the date
hereof, shall have executed and delivered an unconditional Guaranty, in the form
of Exhibit D attached hereto, whereby he unconditionally guarantees the payment
when due of the obligations of the Company under the Notes.
ARTICLE VI.
LEGEND AND STOCK
Each certificate representing any Notes, Warrants, Note Shares, or
Warrant Shares shall be stamped or otherwise imprinted with a legend
substantially in the following form:
31
<PAGE> 32
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR APPLICABLE STATE SECURITIES
LAWS AND THEY MAY NOT BE OFFERED, SOLD, PLEDGED, HYPOTHECATED, ASSIGNED
OR TRANSFERRED EXCEPT (I) PURSUANT TO A REGISTRATION STATEMENT UNDER
THE SECURITIES ACT WHICH HAS BECOME EFFECTIVE AND IS CURRENT WITH
RESPECT TO THESE SECURITIES OR (II) PURSUANT TO A SPECIFIC EXEMPTION
FROM REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE
SECURITIES LAWS, BUT ONLY UPON THE HOLDER HEREOF FIRST HAVING OBTAINED
THE WRITTEN OPINION OF COUNSEL OF THE COMPANY, OR OTHER COUNSEL,
REASONABLY ACCEPTABLE TO THE COMPANY, THAT THE PROPOSED DISPOSITION IS
CONSISTENT WITH ALL APPLICABLE PROVISIONS OF THE SECURITIES ACT AS WELL
AS ANY APPLICABLE "BLUE SKY" OR SIMILAR STATE SECURITIES LAWS.
The certificates representing any Note Shares or Warrant Shares issued
upon conversion of any Notes or Warrant Shares issued upon exercise of any
Warrants shall bear a legend in the same form as the legend on the Notes and the
Warrants indicated above.
ARTICLE VII.
TERMINATION
Section 7.1 Termination by Mutual Consent. This Agreement may be
terminated at any time prior to the Initial Closing Date by the mutual written
consent of the Company and the Investors.
Section 7.2 Other Termination. This Agreement may be terminated by
action of the Board of Directors of the Company or by any of the Investors at
any time if the Initial Closing Date shall not have been consummated by the
fifth business day following the date of this Agreement.
32
<PAGE> 33
ARTICLE VIII.
MISCELLANEOUS
Section 8.1 Stamp Taxes; Agent Fees. The Company shall pay all stamp
and other taxes and duties levied in connection with the issuance of the Notes
and Warrants pursuant hereto and the Note Shares issued upon conversion of the
Notes and the Warrant Shares issued upon the exercise of the Warrants.
Section 8.2 Specific Enforcement; Consent to Jurisdiction.
(a) The Company and the Investors acknowledge and agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that the parties shall be entitled
to an injunction or injunctions to prevent or cure breaches of the provisions of
this Agreement and to enforce specifically the terms and provisions hereof, this
being in addition to any other remedy to which any of them may be entitled by
law or equity.
(b) The Company and each of the Investors (i) hereby irrevocably
submits to the exclusive jurisdiction of the United States District Court, the
New York State courts and other courts of the United States sitting in New York
County, New York for the purposes of any suit, action or proceeding arising out
of or relating to this Agreement and (ii) hereby waives, and agrees not to
assert in any such suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of such court, that the suit, action or
proceeding is brought in an inconvenient forum or that the venue of the suit,
action or proceeding is improper. The Company and each of the Investors consents
to process being served in any such suit, action or proceeding by mailing a copy
thereof to such party at the address in effect for notices to it under this
Agreement and agrees that such service shall constitute good and sufficient
service of process
33
<PAGE> 34
and notice thereof. Nothing in this paragraph shall affect or limit any right to
serve process in any other manner permitted by law.
Section 8.3 Entire Agreement; Amendment. This Agreement, together with
the Notes, the Warrants, and the agreements and documents executed in connection
herewith and therewith, contains the entire understanding of the parties with
respect to the matters covered hereby and thereby and, except as specifically
set forth herein or therein, neither the Company nor any Investor makes any
representation, warranty, covenant or undertaking with respect to such matters.
No provision of this Agreement may be waived or amended other than by a written
instrument signed by the party against whom enforcement of any such amendment or
waiver is sought.
Section 8.4 Notices. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered personally or by
commercial messenger or courier service requiring signed acknowledgment of
delivery, or mailed by registered or certified mail (return receipt requested)
or sent via facsimile (with acknowledgment of complete transmission). If sent by
registered or certified mail, notice shall be deemed to have been received five
(5) days after mailing, if by overnight mail, one (1) day after being sent, or
upon actual receipt if sent by facsimile. All notices shall be addressed to the
parties at the following addresses (or at such other address for a party as
shall be specified by like notice):
to the Company: Dynacs Engineering Co., Inc.
35111 U.S. Highway 19 North
Suite 300
Palm Harbor, Florida 34684
Attn.: Dr. Ramendra P. Singh, President
with copies to: Frankfurt, Garbus, Klein & Selz, P.C.
488 Madison Avenue
New York, New York 10022
Attn.: Gary A. Schonwald, Esq.
34
<PAGE> 35
to the Investors: To each Investor at the address set forth on Schedule
I of this Agreement
with copies to: H.C. Wainwright & Co., Inc.
One Boston Place
40th Floor
Boston, MA 02108
Attn.: Matthew La Fontaine, Associate
Section 8.5 Indemnity. Each party shall indemnify each other party
against any loss, cost or damages (including reasonable attorney's fees but
excluding consequential damages) incurred as a result of such parties' breach of
any representation, warranty, covenant or agreement in this Agreement.
Section 8.6 Waivers. No waiver by any party of any default with respect
to any provision, condition or requirement of this Agreement shall be deemed to
be a continuing waiver in the future or a waiver of any other provision,
condition or requirement hereof, nor shall any delay or omission of any party to
exercise any right hereunder in any manner impair the exercise of any such right
accruing to it thereafter.
Section 8.7 Headings. The headings herein are for convenience only, do
not constitute a part of this Agreement and shall not be deemed to limit or
affect any of the provisions hereof.
Section 8.8 Successors and Assigns. Except as otherwise provided
herein, this Agreement shall be binding upon and inure to the benefit of the
parties and their successors and permitted assigns. The parties hereto may amend
this Agreement without notice to or the consent of any third party. The Company
may not assign this Agreement or any rights or obligations hereunder without the
prior written consent of all Investors (which consent may be withheld for any
reason in their sole discretion), except that the Company may assign this
Agreement in connection with a merger, consolidation, business combination or
the sale of all or
35
<PAGE> 36
substantially all of its assets provided that the Company is not released from
any of its obligations hereunder, such successor in interest or assignee assumes
all obligations of the Company hereunder, and appropriate adjustment of the
provisions contained in this Agreement is made, in form and substance
satisfactory to the Investors, to place the Investors in substantially the same
position as they would have been but for such assignment. Anything contained
herein to the contrary notwithstanding, no Investor shall have the right to
approve or consent to a merger undertaken by the Company solely for the purposes
of changing its state of incorporation. Any Investor may assign this Agreement
(in whole or in part) or any rights or obligations hereunder without the consent
of the Company in connection with any sale or transfer of all or any portion of
the Notes or the Warrants held by such Investor, provided that no Investor may
assign this Agreement (a) prior to the Closing Date without the Company's prior
written consent except to an affiliate or affiliates of such Investor or (b)
unless such assignment is pursuant to an exemption from the registration
requirements of the Securities Act and applicable state securities laws.
Section 8.9 No Third Party Beneficiaries. This Agreement is intended
for the benefit of the parties hereto and their respective permitted successors
and assigns and is not for the benefit of, nor may any provision hereof be
enforced by, any other person.
Section 8.10 Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of New
York without regard to such state's principles of conflict of laws.
Section 8.11 Survival. The representations and warranties and the
agreements and covenants of the Company and each Investor contained herein shall
survive the applicable Closing.
36
<PAGE> 37
Section 8.12 Execution. This Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same agreement, it
being understood that all parties need not sign the same counterpart.
Section 8.13 Publicity. The Company agrees that it will not disclose,
and will not include in any public announcement, the name of any Investor
without its consent, unless and until such disclosure is required by law or
applicable regulation, and then only to the extent of such requirement, provided
that the Company may name the Investors in any filing with the Commission or any
state securities agency or commission.
Section 8.14 Severability. The parties acknowledge and agree that the
Investors are not agents, affiliates or partners of each other, that all
representations, warranties, covenants and agreements of the Investors hereunder
are several and not joint, that no Investor shall have any responsibility or
liability for the representations, warrants, agreements, acts or omissions of
any other Investor, and that any rights granted to "Investors" hereunder shall
be enforceable by each Investor hereunder.
Section 8.15 Like Treatment of Holders. Neither the Company nor any of
its affiliates shall, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee, payment for the redemption or
exchange of Notes or the Warrants, or otherwise, to any holders of Notes or
Warrants, as the case may be, for or as an inducement to, or in connection with
the solicitation of, any consent, waiver or amendment of any terms or provisions
of the Notes or the Warrants or this Agreement, unless such consideration is
required to be paid to all holders of Notes or Warrants, as the case may be,
bound by such consent, waiver or amendment whether or not such holders so
consent, waive or agree to amend and whether or not such holders tender their
Notes or Warrants, as the case may be, for redemption or exchange. The Company
37
<PAGE> 38
shall not, directly or indirectly, redeem any Notes unless such offer of
redemption is made pro rata to all holders of Notes on identical terms. The
Company shall not, directly or indirectly, redeem any Warrants unless such offer
of redemption is made pro rata to all holders of Warrants on identical terms.
Section 8.16 Certain Definitions. As used in this Agreement, the
following terms shall have the following respective meanings:
"Arbitration Proceedings" shall mean the claims of the Company against
Juno Pix, Inc., New Line Pictures, Inc. and New Line Cinema, Inc. in connection
with colorization and other work undertaken by the Company for the motion
picture, "Pleasantville," and the related claims of Juno, New Line Pictures
and/or New Line Cinema against the Company, all before the American Arbitration
Association in California.
"Closing" and "Closing Date" shall have the meanings ascribed to such
terms in Section 1.3 herein.
"Commission" shall mean the Securities and Exchange Commission or any
other Federal agency at the time administering the Securities Act.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
The terms "holder" or "holders" shall mean the original Investors and
any transferee of the Notes, Note Shares, Warrants or Warrant Shares which have
not been sold to the public and to whom the registration rights conferred by
this Agreement have been transferred in compliance with this Agreement.
The term "Majority" shall mean holders owning, in the aggregate, in
excess of fifty percent (50%) of the Registrable Securities that (i) are not
held by the Company, an affiliate, officer, creditor, employee or agent thereof
or any of their respective affiliates, members of their
38
<PAGE> 39
family, persons acting as nominees or in conjunction therewith, and (ii) have
not been resold to the public pursuant to a registration statement filed with
the Commission under the Securities Act or pursuant to Rule 144 promulgated
under the Securities Act; provided, however, that a Majority shall not be less
than an aggregate amount of 35,000 Registrable Securities (the "Minimum
Amount"); provided, further, however, that in the event the piggy-back
registration rights pursuant to Section 4.1 hereof have not been available for
exercise within the twelve-month period prior to the exercise of a demand
registration pursuant to Section 4.2 hereof, the Minimum Amount shall be reduced
to zero.
The terms "register", "registered" and "registration" shall refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act and applicable rules and regulations
thereunder, and the declaration or ordering of the effectiveness of such
registration statement.
"Registrable Securities" shall collectively mean the shares of Common
Stock of the Company issuable upon exercise of the Warrants (the "Warrant
Shares") and upon conversion of the Notes (the "Note Shares") (if such
conversion is permissible on such date of determination), along with any other
securities issued (or issuable upon the conversion or exercise of any warrant,
right or other security which is issued) to each Holder as a result of any stock
split, stock dividend, recapitalization or similar event or upon the exchange of
the shares of Common Stock, issued or issuable upon exercise of the Warrants or
the conversion of the Notes and any other securities of the Company issued as a
dividend or other distribution with respect to, in exchange for or in
replacement of the Warrant Shares or the Note Shares; provided, however, that
the term "Registrable Securities" shall not apply to any shares of Common Stock
remaining unregistered after such time as Rule 144(k) under the Securities Act
of 1933, as amended (the "Securities
39
<PAGE> 40
Act"), is available for the sale of all of such shares without restriction
during a three (3)-month period.
"Regulation D" shall mean Regulation D as promulgated pursuant to the
Securities Act, and as subsequently amended.
"Securities Act" or "Act" shall mean the Securities Act of 1933, as
amended.
"Seller" shall mean a person whose Note Shares and/or Warrant Shares
have been registered with the Commission pursuant to an effective registration
statement filed with the Commission pursuant to the Securities Act pursuant to
Section 4.1 or 4.2 hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
DYNACS ENGINEERING CO., INC.
By:
-------------------------------
Name: Ramendra P. Singh
Title: President
INVESTOR:
By:
-------------------------------
Name:
Title:
Exact Name in Which Note(s) Should
be registered:
- -------------------------------
40
<PAGE> 41
EXHIBITS AND SCHEDULES
<TABLE>
<CAPTION>
<S> <C>
Schedule I List of Investors
Exhibit A Form of Note
Exhibit B Form of Warrant
Exhibit C Form of Opinion of Counsel
Exhibit D Form of Guaranty of Ramendra Singh
Annex A Subsidiaries
</TABLE>
41
<PAGE> 42
SCHEDULE I
<PAGE> 43
SCHEDULE I
INVESTORS
<TABLE>
<CAPTION>
NAME/ADDRESS AMOUNT OF NOTE NUMBER OF WARRANTS
- ------------ -------------- ------------------
<S> <C> <C>
Kathy Simpson $ 50,000 7,500
1422 Downington Overlook
Acworth, GA 30101-8436
James Rubenstein $ 50,000 7,500
163 Allens Point
Marion, MA 02738-2301
Richard H. Morse Charitable $ 50,000 7,500
Trust
40 Broad Street, Suite 1010
Boston, MA 02738-8436
Contact: Richard H. Morse
Manhattan Group Funding $ 100,000 15,000
c/o Ronald I. Heller
74 Fairview Road
Tenafly, NJ 07670
Ethel Lebenkoff $ 100,000 15,000
Lebenkoff Studio
39 West 67th Street, Studio C
New York, NY 10023
Harvey Bibicoff $ 50,000 7,500
4101 Clarinda Drive
Tarzana, CA 91436
Richard L. Hoffman and $ 50,000 7,500
Ricki Hoffman (JTROS)
15 West 36th Street
New York, NY 10018
David M. Weiner $ 50,000 7,500
10 Iron Canyon Ct.
Park City, UT 84060
</TABLE>
<PAGE> 44
EXHIBIT A
<PAGE> 45
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), AND MAY NOT BE OFFERED, SOLD, PLEDGED, HYPOTHECATED,
ASSIGNED OR TRANSFERRED EXCEPT (i) PURSUANT TO A REGISTRATION STATEMENT UNDER
THE ACT WHICH HAS BECOME EFFECTIVE AND IS CURRENT WITH RESPECT TO THESE
SECURITIES, OR (ii) PURSUANT TO A SPECIFIC EXEMPTION FROM REGISTRATION UNDER THE
ACT BUT ONLY UPON A HOLDER HEREOF FIRST HAVING OBTAINED THE WRITTEN OPINION OF
COUNSEL TO THE CORPORATION, OR OTHER COUNSEL REASONABLY ACCEPTABLE TO THE
CORPORATION, THAT THE PROPOSED DISPOSITION IS CONSISTENT WITH ALL APPLICABLE
PROVISIONS OF THE ACT AS WELL AS ANY APPLICABLE "BLUE SKY" OR SIMILAR STATE
SECURITIES LAW.
DYNACS ENGINEERING CO., INC.
SENIOR SUBORDINATED CONVERTIBLE PROMISSORY NOTE
The Transferability of this Note
is Restricted as Provided in Section 6
N-001 Dated: November __, 1999
$__________________________________________________________ New York, New York
FOR VALUE RECEIVED, DYNACS ENGINEERING CO., a Florida corporation (the
"Company"), promises to pay to ___________ or its assigns (the "Holder"), the
principal amount of _____________ Dollars ($______), and to pay interest
(computed on the basis of a 360-day year of twelve 30 day months) on the unpaid
principal amount hereof at the initial rate of eight percent (8%) per annum
during the period commencing on the date hereof until and including the 120th
day from such date and thereafter at a rate of fifteen percent (15%) per annum
until the earlier of (i) the unpaid principal amount and the accrued but unpaid
interest of this Note is converted into shares of Common Stock of the Company at
the Holder's option after a Liquidity Event (as defined in Section 5(a)) in
accordance with Section 5(a) hereof; (ii) the unpaid principal amount and the
accrued but unpaid interest of this Note is exchanged for, or converted into,
Mezzanine Securities (as defined in Section 5(b) hereof) in accordance with
Section 5(b) hereof or (iii) the unpaid principal amount and the accrued but
unpaid interest of this Note is repaid in full. Interest due shall be payable by
the Company on a quarterly basis in accordance with Section 3 hereof. Principal
and accrued but unpaid interest hereunder shall be due and payable in cash on
the Maturity Date (as defined in Section 4 hereof), subject to the terms and
conditions of Sections 5 and 6 hereof. For the purposes of this Note, "cash"
shall mean such coin or currency of the United States of America as at the time
of payment shall be legal tender for the payment of public and private debts.
This Senior Subordinated Convertible Promissory Note ("Note") is part
of the Company's October 1999 bridge financing in which the Company issued notes
(the "Notes") pari passu to several holders (collectively, the "Holders")
pursuant to that certain Warrant and Senior Subordinated Convertible Note
Purchase Agreement, dated November __, 1999 (the
<PAGE> 46
"Agreement"), and warrants to purchase shares of common stock, par value $.01
per share (the "Common Stock"), of the Company. The Holders of the Note Shares
(as hereinafter defined) issuable upon the conversion of this Note, if any, have
certain rights as set forth in the Agreement.
This Note is subject to the following terms and conditions.
1. Unsecured Obligations; Subordination. This Note and the
amounts payable hereunder, including principal and accrued interest, are
unsecured obligations of the Company, and shall be subordinate and junior to
indebtedness incurred by the Company pursuant to (i) currently existing
equipment financings, (ii) currently existing debt of $585,000 secured by
certain revenues pursuant to a Loan Agreement dated May 10, 1999; and (iii) up
to an aggregate of $6,000,000 of indebtedness of the Company presently existing
or hereinafter incurred by the Company under a working capital facility with
First National Bank of Florida, or the renewal or replacement thereof with a
financial institution, bank or commercial lender (collectively, the "Senior
Debt"). Except as set forth in the preceding sentence, the Notes shall not be
subordinate or junior to any other indebtedness of the Company.
2. Covenants. The Company covenants and agrees that, so long
as this Note shall be outstanding and unpaid:
(a) Payment of Note. The Company will punctually pay or cause
to be paid the principal and interest on this Note at the dates and places and
in the manner specified herein. Any sums required to be withheld from any
payment of principal or interest on this Note by operation of law or pursuant to
any order, judgment, execution, treaty, rule or regulation may be withheld by
the Company and paid over in accordance therewith.
Nothing in this Note or in any other agreement between the
Holder and the Company shall require the Company to pay, or the Holder to
accept, interest in an amount which would subject the Holder to any penalty or
forfeiture under applicable law. In the event that the payment of any charges,
fees or other sums due under this Note or provided for in any other agreement
between the Company and the Holder are or could be held to be in the nature of
interest and would subject the Holder to any penalty or forfeiture under
applicable law, then ipso facto the obligations of the Company to make such
payment to the Holder shall be reduced to the highest rate authorized under
applicable law and, in the event that the Holder shall have ever received,
collected, accepted or applied as interest any amount in excess of the maximum
rate of interest permitted to be charged by applicable law, such amount which
would be excess interest under applicable law shall be applied first to the
reduction of principal then outstanding, and, second, if such principal amount
is paid in full, any remaining excess shall forthwith be returned to the
Company.
(b) Guaranty. All sums owed and payable to the Holders shall
be guaranteed by Dr. Ramendra P. Singh, the Chief Executive Officer, President
and principal stockholder of the Company (the "guarantor").
2
<PAGE> 47
(c) Maintenance of Corporate Existence; Merger and
Consolidation. The Company will at all times cause to be done all things
necessary to preserve and keep in full force and effect its corporate existence
and the corporate existence of any Significant Subsidiary (as defined in Rule
405 of the Rules and Regulations under the Securities Act of 1933, as amended
("Significant Subsidiary")) and all of their respective rights and franchises
and neither the Company nor any Significant Subsidiary shall consolidate with or
merge into any other corporation or transfer all or substantially all of its
assets to any person unless (i) the survivor of such consolidation or merger is
the Company or is a company organized in a state other than the Company's
original state of incorporation into which the Company has merged solely to
effect a change in the state of incorporation of the Company, provided that such
company assumes the obligations of the Company under the Notes pursuant to
operation of law, (ii) the corporation formed by such consolidation or into
which the Company is merged or to which the assets of the Company are
transferred is a corporation which expressly assumes all of the obligations of
the Company under the Notes, and (iii) after giving effect to such transaction,
no Event of Default (as hereinafter defined), and no event which, after notice
or lapse of time, or both, would become an Event of Default, shall have occurred
and be continuing.
(d) Maintenance of Properties. The Company shall reasonably
maintain in good repair, working order and condition its properties and other
assets, and those of any Significant Subsidiary, and from time to time make all
reasonably necessary or desirable repairs, renewals and replacements thereto.
(e) Payment of Taxes. The Company will, and will cause any
Significant Subsidiary to, set aside for payment, or discharge before the same
shall become delinquent, all taxes, assessments and governmental charges levied
or imposed upon the Company or any subsidiary, as the case may be, or upon their
respective income, profits or property; provided, however, that neither the
Company nor any subsidiary shall be required to pay or discharge or cause to be
paid or discharged any such tax, assessment or charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings.
(f) Compliance with Statutes. The Company will, and will cause
any Significant Subsidiary to, comply in all material respects with all
applicable statutes and regulations of the United States of America and of any
state or municipality, and of any agency of any thereof, in respect of the
conduct of business, and the ownership of property by the Company or any
Significant Subsidiary; provided, however, that nothing contained in this
Section 2.2(f) shall require the Company or any Significant Subsidiary to comply
with any such statute or regulation so long as its legality or applicability
shall be contested in good faith.
(g) Liens. The Company shall not, and shall not permit any of
its subsidiaries to create, incur or suffer to exist any liens, claims or
encumbrances upon any of its assets or properties, except for those in existence
on the date hereof or those incurred in the ordinary course of business.
(h) Restrictions on Dividends, Redemptions, etc. The Company
will not, and will cause its subsidiaries (other than wholly-owned subsidiaries)
not to, (i) declare or pay any dividend or make any other distribution on any
equity securities of the Company, except
3
<PAGE> 48
dividends or distributions payable in equity securities of the Company or (ii)
purchase, redeem or otherwise acquire or retire for value any equity securities
of the Company, except equity securities acquired upon conversion thereof into
other equity securities of the Company.
(i) Transactions with Affiliates. The Company will not itself,
and will not permit any subsidiary to, engage in any transaction of any kind or
nature with any Affiliate (as such term is used in Rule 405 under the Securities
Act of 1933, as amended (the "Act")) of the Company or any subsidiary, other
than a wholly-owned subsidiary, unless such transaction is upon terms which are
fair to the Company or such subsidiary, as the case may be, and which are
reasonably similar to, or more beneficial to the Company or such subsidiary than
the terms deemed likely to occur in similar transactions with unrelated persons
under the same circumstances.
(j) Indebtedness. The Company shall not, and shall not permit
any of its subsidiaries to, incur any liability or obligation, direct or
contingent, for borrowed money, except for those in existence on the date
hereof, those incurred with respect to the Senior Debt.
3. Interest. Interest shall be payable quarterly on the unpaid
principal amount of this Note at rates established in the first paragraph of the
Preamble of this Note on each February 4, May 4, August 4, and November 4,
commencing on January 4, 2000 (each an "Interest Payment Date"), and on the
Maturity Date.
4. Maturity. If this Note is not converted into shares of
Common Stock of the Company at the option of the Holder in accordance with
Section 5(a) or converted into Mezzanine Securities (as defined in Section 5(b))
of the Company in accordance with Section 5(b) hereof, the principal amount of
this Note, together with accrued but unpaid interest, shall be due and payable
in cash on November 4, 2000 (the "Maturity Date").
5. Conversion.
(a) Liquidity Event. In the event the Company effects an
initial public offering of its Common Stock pursuant to an effective
Registration Statement on an appropriate form with the Securities and Exchange
Commission or sells all or substantially all of its all assets to another entity
(each, a "Liquidity Event"), the Holder of this Note may convert, at any time
after the date which is 120 days after the date of this Note all (but not less
than all) unpaid principal and unpaid accrued interest of this Note, into a
number of shares of Common Stock of the Company ("Note Shares") equal to the
quotient of (i) the unpaid principal and accrued unpaid interest divided by (ii)
the Conversion Price (as defined in Section 5(c)). Upon conversion into Note
Shares pursuant to this paragraph, the principal amount of this Note and accrued
interest thereon shall be discharged in full with the Holder having no recourse
to the Company or the guarantor.
(b) Mezzanine Securities. In the event this Note has not been
converted into Note Shares in accordance with Section 5(a) and the Company
consummates a private financing (the "Mezzanine Financing") of at least
$2,000,000 (before deducting commissions and expenses) of equity or
equity-linked securities (the "Mezzanine Securities") exempt from registration
under Section 4(2) and/or Regulation D promulgated under the Act at any time
during which this Note shall remain outstanding, the unpaid principal and the
accrued and unpaid interest of this Note shall be (i) repaid in cash from the
proceeds of the Mezzanine Financing or (ii) at the election of the Holder in
accordance with this Section 5(b), converted into, or exchanged for, an amount
of Mezzanine Securities on a pari passu basis with investors in the
4
<PAGE> 49
Mezzanine Financing. The Company shall give written notice of the proposed
Mezzanine Financing at least five (5) days prior to the final closing in such
Mezzanine Financing. If the Company receives written notice from the Holder of
the Holder's election to convert this Note into, or exchange this Note for,
Mezzanine Securities within one (1) business day prior to the final closing of
the Mezzanine Financing, this Note shall be converted into, or exchanged for,
Mezzanine Securities in accordance with this Section 5(b). Upon conversion of
this Note into Mezzanine Securities pursuant to this paragraph, the principal
amount of this Note and accrued interest thereon shall be discharged in full
with the Holder having no recourse to the Company or guarantor.
(c) Conversion Price. The "Conversion Price" shall equal (i)
sixty percent (60%) of the initial public offering price of the Company's Common
Stock in the event that the Liquidity Event is the Company's initial public
offering or (ii) in the event the Liquidity Event is the sale of all or
substantially all of the Company's assets to another entity other than an
affiliate of the Company, sixty percent (60%) of the consideration received for
such assets divided by the total number of shares of Common Stock of the Company
outstanding on a fully-diluted basis before such sale.
(d) Method of Conversion. Before the Holder shall be entitled
to receive Note Shares upon the conversion of this Note, the Holder shall
surrender this Note and deliver a Notice of Conversion (in the form attached
hereto as Exhibit A) to the office of the Company or its designated agent. The
Notice of Conversion shall state therein the amount(s) in which the
certificate(s) for Note Shares are to be issued. The time of conversion (the
"Conversion Date") shall be the close of business on the first business day
following the date on which the Company receives the Notice of Conversion.
Interest on the principal amount of Notes converted ceases to accrue on and
after the Conversion Date of such principal amount converted.
(e) Issuance of Note Shares and Mezzanine Securities. The
Company shall, as soon as practicable after surrender of this Note and receipt
of the Notice of Conversion upon the occurrence of a Liquidity Event, but in no
event more than three (3) business days thereafter, issue and deliver to the
Holder, a certificate(s) for the number of Note Shares, as the case may be, to
which the Holder shall be entitled as aforesaid. The Company shall issue and
deliver to the Holder a certificate(s) evidencing the Mezzanine Securities to
which the Holder shall be entitled upon conversion or exchange in accordance
with Section 5(b) hereof upon the later of (i) a Closing Date of the Mezzanine
Financing or (ii) upon surrender of this Note.
(f) Fractional Shares. If any fraction of a Note Share or
Mezzanine Security would be issuable upon conversion of this Note, as the case
may be, the Company shall, at its sole option, issue fractions of Note Shares or
Mezzanine Securities, as the case may be, or purchase such fraction for an
amount in cash equal to the fair market value of such fraction on the date of
conversion of this Note. Nothing in this Note shall obligate the Company to
issue
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<PAGE> 50
fractional Note Shares or Mezzanine Securities, as the case may be, upon the
conversion of this Note.
(g) Adjustment of Conversion Price; Merger.
(i) If at any time after the consummation of a
Liquidity Event, the Company at any time or from time to time while this Note is
issued and outstanding shall declare or pay, without consideration, any dividend
on the Common Stock payable in Common Stock, or shall effect a subdivision of
the outstanding shares of Common Stock into a greater number of shares of Common
Stock (by stock split, reclassification or otherwise than by payment of a
dividend in Common Stock or in any right to acquire Common Stock) or if the
outstanding shares of Common Stock shall be combined or consolidated, by
reclassification or otherwise, into a lesser number of shares of Common Stock,
then the Conversion Price in effect immediately before such event shall,
concurrently with the effectiveness of such event, be proportionately decreased
or increased, as appropriate. If the Company shall declare or pay, without
consideration, any dividend on the Common Stock payable in any right to acquire
Common Stock for no consideration, then the Company shall be deemed to have made
a dividend payable in Common Stock in an amount of shares equal to the maximum
number of shares, issuable upon exercise of such rights to acquire Common Stock.
(ii) If at any time after the consummation of a
Liquidity Event, the Common Stock shall be changed into the same or a different
number of shares of any other class or classes of stock, whether by capital
reorganization, reclassification or otherwise (other than a subdivision or
combination of shares provided for in Section 5(g)(i)), the Conversion Price
then in effect shall, concurrently with the effectiveness of such reorganization
or reclassification, be proportionately adjusted so that the Note Shares shall
be convertible into, in lieu of the number of shares of Common Stock which the
Holder would otherwise have been entitled to receive, a number of shares of such
other class or classes of stock equivalent to the number of shares of Note
Shares that would have been subject to receipt by the Holder upon conversion of
this Note immediately before that change.
(iii) In case of any consolidation or merger of the
Company with any other corporation, limited liability company or any other
entity (each such transaction, a "Merger"), the entity formed by the Merger
shall succeed to the covenants, stipulations, promises and the agreements
contained in this Note. In the event of a Merger, the Company shall make
appropriate provisions so that the Holder shall have the right thereafter to
convert this Note into the kind and amount of securities receivable upon such
Merger by a Holder of the number of securities into which this Note could have
been converted immediately prior to a Merger. The above provisions shall
similarly apply to successive Mergers.
(h) Reservation of Stock. The Company shall at all times
reserve and keep available out of its authorized but unissued shares of Common
Stock, solely for the purpose of effecting the conversion of the Notes into Note
Shares, such number of its shares of Common Stock as shall from time to time be
sufficient to effect the conversion of all of the Notes; and if at any time the
number of authorized but unissued shares of Common Stock shall not be sufficient
to effect the conversion of the Note then, the Company will take such corporate
action as in the
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<PAGE> 51
opinion of its counsel may be necessary to increase its authorized but unissued
shares of Common Stock to such number of shares as shall be sufficient for such
purpose, including without limitation, engaging in best efforts to obtain the
requisite shareholder approval.
(i) Issue Taxes. The Company shall pay any and all issue and
other taxes that may be payable in respect of any issue or delivery of Note
Shares; provided, that the Company shall not be obligated to pay any transfer
resulting from any transfer requested by the Holder in connection with any such
conversion.
6. Restrictions Upon Transferability. This Note has not been
registered under the Act, and may not be offered, sold, pledged, hypothecated,
assigned or transferred except (i) pursuant to a registration statement under
the Act which has become effective and is current with respect to this Note, or
(ii) pursuant to a specific exemption from registration under the Act but only
upon a Holder hereof first having obtained the written opinion of counsel to the
Company, or other counsel reasonably acceptable to the Company, that the
proposed disposition is consistent with all applicable provisions of the Act as
well as any applicable "blue sky" or other state securities law.
7. No Prepayment. Except as in accordance with Section 5, the
principal amount of this Note shall not be prepaid, in whole or in part, prior
to the Mezzanine Financing.
8. Events of Default and Remedies. An "Event of Default" shall
occur if:
(a) Payment of Notes. The Company defaults in the payment of
the principal or interest of this Note, when and as the same shall become due
and payable whether at maturity thereof, or by acceleration or otherwise, which
default shall continue uncured for a period of five (5) days from the date
thereof; or
(b) Performance of Covenants, Conditions or Agreements. The
Company fails to comply with any of the covenants, conditions or agreements set
forth in this Note and such default shall continue uncured for a period of
thirty (30) days after receipt of written notice to the Company from any Holder
stating the specific default or defaults; or
(c) Cross-default. A default by the Company under a material
agreement if such default is not cured or waived within the cure or other
applicable time periods provided in such agreement.
(d) Change of Control. Any person or group (as defined in
Section 13(d)(3) of the Exchange Act of 1934) of persons, other than (i) the
executive officers and directors of the Company and any persons nominated to
serve as a director of the Company at the date hereof, (ii) the holders of the
Notes, and (iii) the holders of the Warrants, acquire beneficial ownership (as
defined in Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, as
amended) of a majority of the Company's then outstanding Common Stock.
(e) Bankruptcy, Insolvency, etc. The Company or any
Significant Subsidiary shall file or consent by answer or otherwise to the entry
of an order for relief or approving a
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<PAGE> 52
petition for relief, reorganization or arrangement or any other petition in
bankruptcy for liquidation or to take advantage of any bankruptcy or insolvency
law of any jurisdiction, or shall make an assignment for the benefit of its
respective creditors, or shall consent to the appointment of a custodian,
receiver, trustee or other officer with similar powers of itself or of any
substantial part of their respective property, or shall be adjudicated a
bankrupt or insolvent, or shall take corporate action for the purpose of any of
the foregoing, or if a court or governmental authority of competent jurisdiction
shall enter an order appointing a custodian, receiver, trustee or other officer
with similar powers with respect to the Company or any Significant Subsidiary or
any substantial part of their respective property or an order for relief or
approving a petition for relief or reorganization or any other petition in
bankruptcy or for liquidation or to take advantage of any bankruptcy or
insolvency law, or an order for the dissolution, winding up or liquidation of
the Company or any Significant Subsidiary, or if any such petition shall be
filed against the Company or any Significant Subsidiary and such petition shall
not be dismissed within sixty (60) days.
(f) Representations and Warranties. If any representation,
warranty or statement of fact made in writing by or on behalf of the Company or
by any officer of the Company herein, in the Agreement or in any writing
furnished in connection with the transactions contemplated hereby proves to have
been incorrect, false or misleading in any material respect on the date as of
which made.
(g) Remedies. In case an Event of Default (other than an Event
of Default resulting from the Company's failure to pay the principal of, or any
interest upon, this Note, when the same shall be due and payable in accordance
with the terms hereof and an Event of Default resulting from bankruptcy,
insolvency or reorganization) shall occur and be continuing, the Holders of the
Notes representing at least fifty-one percent (51%) in the aggregate of the
principal amount of the Notes then outstanding, may declare by notice in writing
to the Company all unpaid principal and accrued interest on all of the Notes
then outstanding to be due and payable immediately. In case an Event of Default
resulting from the Company's nonpayment of principal of, or interest upon, this
Note shall occur, the Holder may declare all unpaid principal and accrued
interest on this Note held by such Holder to be due and payable immediately. In
case an Event of Default resulting from bankruptcy, insolvency or reorganization
shall occur, all unpaid principal and accrued interest on the Note held by the
Holder shall be due and payable immediately without any declaration or other act
on the part of such Holders. Any such acceleration may be annulled and past
defaults (except, unless theretofore cured, a default in payment of principal or
interest on the Note) may be waived by the Holders of a majority in principal of
the Notes then outstanding.
9. Costs of Collection. Should the indebtedness represented by
this Note or any part thereof be collected in any proceeding, or this Note be
placed in the hands of attorneys for collection after default, the Company
agrees to pay as an additional obligation under this Note, in addition to the
principal and interest due and payable hereon, all costs of collecting this
Note, including reasonable attorneys' fees.
10. Waiver and Amendments. This Note may be amended, modified,
superseded, canceled, renewed or extended, and the terms hereof may be waived
only by a
8
<PAGE> 53
written instrument signed by the Company and the Holders of at least fifty-one
percent (51%) in principal amount of the Notes then outstanding; provided,
however, that the consent of a Holder shall be required to modify the terms of
this Note affecting the payment of principal amount of, or interest on, such
Holder's Note or the term of such Holder's Note. No delay on the part of any
party in exercising any right, power or privilege hereunder shall operate as a
waiver hereof, nor shall any waiver on the part of any party of any right, power
or privilege hereunder preclude any other or further exercise hereof or the
exercise of any other right, power or privilege hereunder. The rights and
remedies provided herein are cumulative and are not exclusive of any rights or
remedies which any party may otherwise have at law or in equity.
11. Loss, Theft, Destruction or Mutilation of Note. Upon
receipt by the Company of evidence reasonably satisfactory to the Company of the
loss, theft, destruction or mutilation of this Note, and of indemnity or
security reasonably satisfactory to the Company, and upon reimbursement to the
Company of all reasonable expenses incidental thereto, and upon surrender and
cancellation of this Note, if mutilated, the Company will make and deliver a new
Note of like tenor, in lieu of this Note. Any Note made and delivered in
accordance with the provisions of this Section 11 shall be dated as of the date
to which interest has been paid on this Note, or if no interest has theretofore
been paid on this Note, then dated the date hereof.
12. Notice. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered personally or by
commercial messenger or courier service requiring signed acknowledgment of
delivery, or mailed by registered or certified mail (return receipt requested)
or sent via facsimile (with acknowledgment of complete transmission). If sent by
registered or certified mail, notice shall be deemed to have been received five
(5) days after mailing, if by overnight mail, one (1) day after being sent, or
upon actual receipt if sent by facsimile. All notices shall be addressed to the
parties at the following addresses (or at such other address for a party as
shall be specified by like notice):
(i) if to the Company, to:
Dynacs Engineering Co., Inc.
3511 U.S. Highway 19 North
Suite 3000
Palm Harbor, Florida 34684
Attn.: Dr. Ramendra P. Singh, President
with a copy to:
Frankfurt, Garbus, Klein & Selz, P.C.
488 Madison Avenue
New York, New York 10022
Attn.: Gary A. Schonwald, Esq.
(ii) if to the Holder, to the address of such Holder as
shown on the books of the Company,
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<PAGE> 54
with a copy to:
H.C. Wainwright & Co., Inc.
One Boston Place
40th Floor
Boston, MA 02108
Attn.: Matthew La Fontaine, Associate
13. Governing Law. This Note shall be governed by and
construed in accordance with the laws of the State of New York, without giving
effect to its conflicts of law principles. The Company agrees that any dispute
or controversy arising out of this Note shall be adjudicated in a court located
in New York City, and hereby submits to the exclusive jurisdiction of the courts
of the State of New York located in New York, New York and of the federal courts
in the Southern District of New York, and irrevocably waives any objection it
now or hereafter may have respecting the venue of such action or proceeding
brought in such a court or respecting the fact that such court is an
inconvenient forum, and consents to the service of process in any such action or
proceeding by means of registered or certified mail, return receipt requested.
14. Successors and Assigns. All the covenants, stipulations,
promises and agreements in this Note contained by or on behalf of the Company
shall bind its successors and assigns, whether or not so expressed.
15. Severability. If any provision of this Note is invalid,
illegal or unenforceable, the balance of this Note shall remain in effect, and
if any provision is inapplicable to any person or circumstances, it shall
nevertheless remain applicable to all other persons and circumstances. The rate
of interest on this Note is subject to any limitation imposed by applicable
usury laws.
16. Headings. The headings in this Note are solely for
convenience of reference and shall be given no effect in the construction or
interpretation of this Note.
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<PAGE> 55
IN WITNESS WHEREOF, the Company has caused this Note to be signed in
its corporate name by a duly authorized officer and to be dated as of the date
first above written.
DYNACS ENGINEERING CO., INC.
By:
------------------------------------
Ramendra P. Singh
President
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<PAGE> 56
EXHIBIT A
NOTICE OF CONVERSION
The undersigned being the holder of the attached Senior Subordinated
Convertible Note(s) due the Maturity Date (as defined in the Note) of DYNACS
ENGINEERING CO., INC., a Florida corporation (the "Company"), hereby exercises
the option to convert the Note into Note Shares (as defined in the Note)) in
accordance with the terms of the Note.
The undersigned directs that the Note Shares be issued in the name of
the holder of the attached Note and delivered as soon as practicable and in
accordance with the provisions of the Note to:
Full address
----------------------------------
----------------------------------
----------------------------------
Date:
--------------------------
By:
--------------------------------
Name:
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<PAGE> 57
EXHIBIT B
<PAGE> 58
Warrant Number: W-
WARRANT
THIS WARRANT HAS BEEN ACQUIRED FOR INVESTMENT AND HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR APPLICABLE
STATE SECURITIES LAWS. IT MAY NOT BE SOLD, TRANSFERRED OR
PLEDGED IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS THE
COMPANY RECEIVES AN OPINION OF COUNSEL (WHICH MAY BE COUNSEL
FOR THE COMPANY) REASONABLY ACCEPTABLE TO IT STATING THAT SUCH
SALE, TRANSFER OR PLEDGE IS EXEMPT FROM THE REGISTRATION AND
PROSPECTUS DELIVERY REQUIREMENTS OF SAID ACT AND STATE
SECURITIES LAWS. COPIES OF THE AGREEMENT COVERING THE PURCHASE
OF THIS WARRANT AND RESTRICTING ITS TRANSFER MAY BE OBTAINED
AT NO COST BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF
THIS WARRANT TO THE SECRETARY OF DYNACS ENGINEERING CO., INC.
AT ITS PRINCIPAL EXECUTIVE OFFICES.
THIS WARRANT IS ONE OF A SERIES OF WARRANTS ISSUED IN CONJUNCTION WITH
A PRIVATE OFFERING (THE "PRIVATE PLACEMENT") OF WARRANTS (COLLECTIVELY, THE
"WARRANTS") AND UP TO $1.0 MILLION PRINCIPAL AMOUNT OF SENIOR SUBORDINATED NOTES
CONVERTIBLE INTO SHARES OF COMMON STOCK, PAR VALUE $.01 PER SHARE (THE "COMMON
STOCK"), OF THE COMPANY (COLLECTIVELY, THE "NOTES") UNDER CERTAIN CIRCUMSTANCES.
THE TERM "REGISTRABLE SECURITIES" SHALL MEAN THE SHARES OF COMMON STOCK OF THE
COMPANY ISSUABLE UPON EXERCISE OF THE WARRANTS (THE "WARRANT SHARES") AND UPON
CONVERSION OF THE NOTES (THE "NOTE SHARES") (IF SUCH CONVERSION IS PERMISSIBLE
ON SUCH DATE OF DETERMINATION), ALONG WITH ANY OTHER SECURITIES ISSUED (OR
ISSUABLE UPON THE CONVERSION OR EXERCISE OF ANY WARRANT, RIGHT OR OTHER SECURITY
WHICH IS ISSUED) TO EACH HOLDER AS A RESULT OF ANY STOCK SPLIT, STOCK DIVIDEND,
RECAPITALIZATION OR SIMILAR EVENT OR UPON THE EXCHANGE OF THE SHARES OF COMMON
STOCK, ISSUED OR ISSUABLE UPON EXERCISE OF THE WARRANTS OR THE CONVERSION OF THE
NOTES AND ANY OTHER SECURITIES OF THE COMPANY ISSUED AS A DIVIDEND OR OTHER
DISTRIBUTION WITH RESPECT TO, IN EXCHANGE FOR OR IN REPLACEMENT OF THE WARRANT
SHARES OR THE NOTE SHARES; PROVIDED, HOWEVER, THAT THE TERM "REGISTRABLE
SECURITIES" SHALL NOT APPLY TO ANY SHARES OF COMMON STOCK REMAINING UNREGISTERED
AFTER SUCH TIME AS RULE 144(K) UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT") IS AVAILABLE FOR THE SALE OF ALL OF SUCH SHARES WITHOUT
RESTRICTION DURING A THREE (3)-MONTH PERIOD.
1. NUMBER AND PRICE OF SHARES SUBJECT TO WARRANT. Subject to
the terms and conditions set forth herein, _____________ (the "Purchaser") is
entitled to purchase from Dynacs Engineering Co., Inc., a Florida corporation
(the "Company"), at any time from and after the first anniversary date of the
date of issuance of this Warrant (the "Issuance Date") until the earlier of (a)
the fifth anniversary date of the Issuance Date or (b) the fourth anniversary
date of a Liquidity Event (as defined herein), ______________ shares (which
number of shares is subject to adjustment as described below) of fully paid and
non-assessable Common Stock of the Company upon surrender hereof at the
principal office of the Company and, at the election of the holder of this
warrant (the "Holder"), upon either (i) payment of the purchase price at said
office in cash or by check or (ii) tender of a notice and surrender of this
Warrant as provided in Section 6(b) hereof. Subject to adjustment as hereinafter
provided, the purchase price of one share of Common Stock (or such
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<PAGE> 59
securities as may be substituted for one share of Common Stock pursuant to the
provisions hereinafter set forth) shall upon the occurrence of a Liquidity Event
(as defined below) be equal to (x) if the Liquidity Event is the Company's
initial public offering, seventy percent (70%) of the initial public offering
price per share or (y) if the Liquidity Event is the sale of all or
substantially all of the Company's assets, seventy percent (70%) of the
consideration received for such assets divided by the total number of shares of
Common Stock of the Company outstanding on a fully-diluted basis before such
sale. The purchase price of one share of Common Stock (or such securities as may
be substituted for one share of Common Stock pursuant to the provisions
hereinafter set forth) payable from time to time upon the exercise of this
Warrant (whether such price be the price specified above or an adjusted price
determined as hereinafter provided) is referred to herein as the "Warrant
Price." As used in this Warrant Agreement, "Liquidity Event" shall mean an
initial public offering of the Company's securities pursuant to an effective
registration statement on an appropriate form with the Securities and Exchange
Commission (the "Commission") or a sale of all or substantially all of the
assets of the Company.
2. ADJUSTMENT OF WARRANT PRICE AND NUMBER OF SHARES. The
number and kind of securities issuable upon the exercise of this Warrant shall
be subject to adjustment from time to time upon the happening of certain events
as follows:
(a) ADJUSTMENT FOR DIVIDENDS IN STOCK OR OTHER
SECURITIES OR PROPERTY. In case at any time or from time to time on or after the
date hereof the holders of the Common Stock of the Company (or any shares of
stock or other securities at the time receivable upon the exercise of this
Warrant) shall have received, or, on or after the record date fixed for the
determination of eligible stockholders, shall have become entitled to receive,
without payment therefor, other or additional stock or other securities or
property (other than cash) of the Company by way of dividend, then, and in each
case, the Holder shall, upon the exercise hereof, be entitled to receive, in
addition to the number of shares of Common Stock receivable thereupon, and
without payment of any additional consideration therefor, the amount of such
other or additional stock or other securities or property (other than cash) of
the Company which such Holder would hold on the date of such exercise had it
been the holder of record of such Common Stock on the date hereof and had
thereafter, during the period from the date hereof to and including the date of
such exercise, retained such shares and/or all other additional stock available
by it as aforesaid during such period, giving effect to all adjustments called
for during such period by paragraphs (b) and (c) of this Section 2.
(b) ADJUSTMENT FOR RECLASSIFICATION, REORGANIZATION
OR MERGER. In case of any reclassification or change of the outstanding
securities of the Company or of any reorganization of the Company (or any other
corporation the stock and securities of which are at the time receivable upon
the exercise of this Warrant) or any similar corporate reorganization on or
after the date hereof, then and in each such case the Holder, upon the exercise
hereof at any time after the consummation of such reclassification, change, or
reorganization shall be entitled to receive, in lieu of the stock or other
securities and property receivable upon the exercise hereof prior to such
consummation, the stock or other securities or property to which such Holder
would have been entitled upon such consummation if such Holder had exercised
this Warrant immediately prior thereto, all subject to further adjustment as
provided in paragraphs (a) and (c); and in each such case,
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<PAGE> 60
the terms of this Section 2 shall be applicable to the shares of stock or other
securities properly receivable upon the exercise of this Warrant after such
consummation.
(c) STOCK SPLITS AND REVERSE STOCK SPLITS. If at any
time on or after the date hereof the Company shall subdivide its outstanding
shares of Common Stock into a greater number of shares, the Warrant Price in
effect immediately prior to such subdivision shall thereby be proportionately
reduced and the number of shares receivable upon exercise of the Warrant shall
thereby be proportionately increased; and, conversely, if at any time on or
after the date hereof the outstanding number of shares of Common Stock shall be
combined into a smaller number of shares, the Warrant Price in effect
immediately prior to such combination shall thereby be proportionately increased
and the number of shares receivable upon exercise of this Warrant shall thereby
be proportionately decreased.
3. NO FRACTIONAL SHARES. No fractional shares of Common Stock
will be issued in connection with any exercise hereunder. In lieu of any
fractional shares which would otherwise be issuable, the Company shall pay cash
equal to the product of such fraction multiplied by the fair market value of one
share of Common Stock on the date of exercise, as determined in good faith by
the Company's Board of Directors.
4. NO STOCKHOLDER RIGHTS. This Warrant shall not entitle the
Holder to any of the rights of a stockholder of the Company.
5. RESERVATION OF STOCK. The Company covenants that during the
period this Warrant is exercisable, the Company will reserve from its authorized
and unissued Common Stock a sufficient number of shares to provide for the
issuance of Common Stock upon the exercise of this Warrant. The Company agrees
that its issuance of this Warrant shall constitute full authority to its
officers who are charged with the duty of executing stock certificates to
execute and issue the necessary certificates for shares of Common Stock upon the
exercise of this Warrant.
6. EXERCISE OF WARRANT.
(a) METHOD OF EXERCISE. This Warrant may be exercised
by the Holder from time to time, in whole or in part by the surrender of this
Warrant with the "Election to Exercise" attached hereto, duly executed to the
principal office of the Company, at 35111 U.S. Highway 19 North, Suite 300, Palm
Harbor, Florida 34684, or at such other places designated in writing by the
Company, accompanied by payment to the Company, by cash or check, of an amount
equal to the then applicable Warrant Price per share multiplied by the number of
shares of Common Stock being purchased. This Warrant shall be deemed to have
been exercised immediately prior to the close of business on the date of its
surrender for exercise as provided above, and the person entitled to receive the
shares of Common Stock issuable upon such exercise shall be treated for all
purposes as the holder of such shares of record as of the close of business on
such date. As promptly as practicable on or after such date, the Company at its
expense shall issue and deliver to the person or persons entitled to receive the
same a certificate or certificates for the number of full shares of Common Stock
issuable upon such exercise, together with cash in lieu of any fraction of a
share as provided above, and, unless this Warrant has been fully exercised or
has expired, a new Warrant
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<PAGE> 61
representing the portion of the shares of Common Stock, if any, with respect to
which this Warrant shall not have been exercised, shall also be issued to the
Holder hereof. The shares of Common Stock issuable upon exercise hereof shall,
upon their issuance, be fully paid and nonassessable.
(b) NET ISSUE EXERCISE.
(i) In lieu of exercising this Warrant in the
manner provided above in Section 6(a), the Holder may elect to receive shares
equal to the value of this Warrant (or the portion thereof being canceled) by
surrender of this Warrant at the principal office of the Company together with
notice of such election in which event the Company shall issue to Holder a
number of shares of the Company's Common Stock computed using the following
formula:
X = Y(A-B)
------
A
Where:
X = The number of shares of Common Stock to be issued to the Holder.
Y = The number of shares of Common Stock purchasable under this
Warrant (at the date of such calculation).
A = The fair market value of one share of the Company's Common Stock
(at the date of such calculation).
B = The Warrant Price (as adjusted to the date of such calculation).
(ii) For purposes of this Section 6(b), fair
market value of the Company's Common Stock shall mean the price per share which
the Company could obtain from a willing buyer for the shares sold by the Company
from authorized but unissued shares, as such price shall be determined in good
faith by the Board of Directors of the Company.
7. REGISTRATION RIGHTS. For the purposes of Section 7,
"Holder" shall mean the original holder and any transferee of the Warrants or
Warrant Shares which have not been sold to the public and to whom the
registration rights conferred by that certain Warrant and Senior Subordinated
Note Purchase Agreement among the Company and the investors in the Private
Placement have been transferred in compliance of such Agreement.
(a) PIGGYBACK REGISTRATION. If, at any time during
the five-year period commencing six (6) months after the Company initially
becomes subject to the reporting requirements of Section 13 or Section 15(g)
under the Exchange Act, the Company proposes to register any of its securities
under the Securities Act (other than in connection with the Company's initial
public offering, a transaction contemplated by Rule 145(a) promulgated under the
Securities Act or pursuant to Forms S-8 or S-4 or successor forms), the Company
shall give written notice by registered or certified mail, at least thirty (30)
days prior to the filing of each such registration statement, to the Holder(s)
of the Registrable Securities of its intention to do so. Upon the written
request of any Holder given within ten (10) days after receipt of any such
notice of his desire to include any Registrable Securities in such proposed
registration statement, the Company shall afford such Holder the opportunity to
have any such Registrable Securities registered under such registration
statement.
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Notwithstanding the provisions of this Section 7(a),
the Company shall have the right at any time after it shall have given written
notice pursuant to this Section 7(a) (irrespective of whether a written request
for inclusion of any such securities shall have been made) to elect not to file
any such proposed registration statement, or to withdraw the same after the
filing but prior to the effective date thereof.
If any registration pursuant to this Section 7(a)
shall be underwritten in whole or in part, the Company may require that the
Holder's Registrable Securities requested for inclusion pursuant to this Section
7(a) be included in the underwriting on the same terms and conditions as the
securities otherwise being sold through the underwriter(s), and then only in
such quantity as, together with all other Registrable Securities, will not, in
the opinion of the underwriters, jeopardize the success of the underwritten
offering by the Company. In the case of a (i) primary registration statement on
behalf of the Company or (ii) secondary registration statement on behalf of
holders of securities of the Company exercising a right to request or demand
registration, if in the opinion of the managing underwriter the registration of
the number of Registrable Securities that the Holders have requested to be
registered would adversely affect such public offering, then the Company shall
be required to include in the underwriting only that number of Registrable
Securities, in addition to all of the shares to be sold by the Company, or any
other stockholder of the Company that the managing underwriter believes may be
sold without causing such adverse effect. The shares (including without
limitation Warrant Shares) to be so included shall be, first, the shares Company
proposes to sell in a primary offering or the securities requested to be
included therein by holders of Registrable Securities requesting such
registration pursuant to a demand registration or an unfulfilled automatic right
to registration in the case of a secondary registration, and, second, shares
which have piggy-back rights. If less than all shares in either class are to be
registered by reason of the managing underwriter's cutback, shares within such
class (including without limitation Warrant Shares) shall be allowed to
participate in such underwriting on a pro rata basis based upon the number of
securities requested to be included by each participating shareholder.
(b) DEMAND REGISTRATION.
(i) At any time during the five-year period
commencing six (6) months after the Company initially becomes subject to the
reporting requirements of Section 13 or Section 15(g) under the Exchange Act,
the holders of a Majority (as defined below) of the Registrable Securities shall
have the right (which right is in addition to the registration rights under
Section 7(a) hereof), exercisable by written notice to the Company, to have the
Company prepare and file with the Commission, on one occasion, a registration
statement and such other documents, including a prospectus, as may be necessary
in the opinion of both counsel for the Company and counsel for the underwriter,
if any, and such holders, in order to comply with the provisions of the
Securities Act, so as to permit a public offering and sale of their respective
Registrable Securities for nine (9) consecutive months by such holders and any
other holders of Registrable Securities who notify the Company within ten (10)
days after receiving notice from the Company of such request, provided, that the
Company is subject to the reporting requirements of the Exchange Act at the time
of the written notice to the Company. The term "Majority" shall mean holders
owning, in the aggregate, in excess of fifty percent (50%) of the Registrable
Securities that (i) are not held by the Company, an affiliate, officer,
creditor, employee or agent thereof or any of their respective
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affiliates, members of their family, persons acting as nominees or in
conjunction therewith, and (ii) have not been resold to the public pursuant to a
registration statement filed with the Commission under the Securities Act or
pursuant to Rule 144 promulgated under the Securities Act; provided, however,
that a Majority shall not be less than an aggregate amount of 35,000 Registrable
Securities (the "Minimum Amount"); provided, further, however, that in the event
the piggy-back registration rights pursuant to Section 7(a) hereof have not been
available for exercise within the twelve-month period prior to the exercise of a
demand registration pursuant to Section 7(b) hereof, the Minimum Amount shall be
reduced to zero.
(ii) The Company covenants and agrees to give
written notice of any registration request under this Section 7(b) by any
Holder(s) to all other Holders within ten (10) days of the receipt of any such
registration request.
(c) COVENANTS OF THE COMPANY WITH RESPECT TO
REGISTRATION. In connection with any registration under Section 7(a) or 7(b)
hereof, the Company covenants and agrees as follows:
(i) to use commercially reasonable efforts to
file a registration statement within forty-five (45) days of receipt of any
demand therefor and to cause any registration statement to be declared effective
at the earliest possible time. The Company shall furnish each Holder desiring to
sell its Registrable Securities such number of prospectuses as shall reasonably
be requested;
(ii) to pay all costs (excluding transfer taxes,
if any, and any underwriting or selling commissions), fees and expenses in
connection with all registration statements filed pursuant to Section 7(a) or
7(b) hereof including, without limitation, the Company's legal and accounting
fees, printing expenses and blue sky fees and expenses
(iii) as expeditiously as possible, to prepare
and file with the Commission any amendments and supplements to the registration
statement and the prospectus included in the registration statement as may be
necessary to keep the registration statement effective, in the case of a firm
commitment underwritten public offering, until each underwriter has completed
the distribution of all securities purchased by it and, in the case of any other
offering, until the earlier of the sale of all Registrable Shares covered
thereby or two hundred seventy (270) days after the effective date thereof;
(iv) as expeditiously as possible, to furnish to
each Holder whose Registrable Securities have been registered pursuant to an
effective registration statement filed with the Commission under the Securities
Act pursuant to Section 7 hereof (the "Seller") such reasonable numbers of
copies of the prospectus, including a preliminary prospectus, in conformity with
the requirements of the Securities Act, and such other documents as the Seller
may reasonably request in order to facilitate the public sale or other
disposition of the Warrant Shares owned by him;
(v) as expeditiously as possible, to use its
commercially reasonable efforts to register or qualify the Holder's Registrable
Securities covered by the registration statement
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under the securities or blue sky laws of such states as Seller shall reasonably
request, and do any and all other acts and things that may be necessary or
desirable to enable Seller to consummate the public sale or other disposition in
such states of the Registrable Securities owned by Seller; provided, however,
that the Company shall not be required in connection with this subsection (v) to
qualify as a foreign corporation in any jurisdiction in which it is not already
obligated to qualify or execute or file a general consent to service of process
in any jurisdiction;
(vi) if the registration statement relates to an
underwritten offering, to enter into and perform its obligations under an
underwriting agreement in the usual and customary form, including without
limitation, customary indemnification and contribution obligations with the
underwriter's representative;
(vii) to notify the Seller at any time when a
prospectus relating to Registrable Securities covered by the registration
statement is effective, of the happening of any event as a result of which the
prospectus included in the registration statement, as then in effect, includes
an untrue statement of a material fact or omits to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing. The Company shall use
commercially reasonable efforts promptly to amend or supplement the registration
statement to correct any such untrue statement or omission;
(viii) to notify the Seller of the issuance by
the Commission of any stop order suspending the effectiveness of the
registration statement or the initiation of any proceedings for that purpose.
The Company will make every commercially reasonable effort to prevent the
issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible time;
(ix) if the Company has delivered preliminary or
final prospectuses to the Seller and after having done so the prospectus is
amended to comply with the provisions of the Securities Act or is amended or
supplemented, the Company shall promptly notify the Seller. In that case, the
Seller shall immediately cease making offers of the Registrable Securities and,
if requested, return all prospectuses to the Company. The Company shall promptly
provide the Seller with revised prospectuses and, following receipt of the
revised prospectuses, Seller shall be free to resume making offers of
Registrable Securities.
(x) permit a single firm of counsel, designated
as Holders' counsel by the holders of a majority of the Registrable Securities
included in the registration statement, to review the registration statement and
all amendments and supplements thereto within a reasonable period of time prior
to each filing, and shall not file any document in a form to which such counsel
reasonably objects.
(xi) the Company shall make available for
inspection by the Holders, representative(s) of all the Holders together, any
underwriter participating in any disposition pursuant to a registration
statement, and any attorney or accountant retained by any Holder or underwriter,
all financial and other records customary for purposes of the Holders' due
diligence examination of the Company, pertinent corporate documents and
properties of the
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Company, and cause the Company's officers, directors and employees to supply all
information reasonably requested by any such representative, underwriter,
attorney or accountant in connection with such registration statement, provided
that such parties agree to keep such information confidential.
(d) INDEMNIFICATION BY THE COMPANY
(i) In the event that the Company registers any
of the Registrable Securities under the Securities Act, the Company will
indemnify and hold harmless each participating Seller and each underwriter of
the Registrable Securities registered (including any broker or dealer through
whom such shares may be sold pursuant to the applicable underwriting agreement
and their respective officers, directors, affiliates and partners) and each
Person (as defined below), if any, who controls such Seller or any such
underwriter within the meaning of Section 15 of the Securities Act, from and
against any and all losses, claims, damages, expenses or liabilities, joint or
several, to which they or any of them become subject under the Securities Act,
applicable state securities laws or under any other statute or at common law or
otherwise, as incurred, and, except as hereinafter provided, will reimburse each
such Holder, each such underwriter and each such controlling Person, if any, for
any legal or other expenses reasonably incurred by them or any of them in
connection with investigating or defending any actions whether or not resulting
in any liability, as incurred, insofar as such losses, claims, damages,
expenses, liabilities or actions arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the
registration statement, in any preliminary or amended preliminary prospectus or
in the final prospectus (or the registration statement or prospectus as from
time to time amended or supplemented by the Company) in any application or other
document executed by the Company or based upon information furnished by the
Company filed in any jurisdiction in order to qualify the securities under the
securities laws thereof or filed with the Commission, the National Association
of Securities Dealers, Inc., the Nasdaq Stock Market or any exchange, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary in order to make the
statements therein not misleading, or any violation by the Company of any rule
or regulation promulgated under the Securities Act or any state securities laws
applicable to the Company and relating to action or inaction required of the
Company in connection with such registration, (A) unless such untrue statement
or alleged untrue statement or omission or alleged omission was made in such
registration statement, preliminary or amended preliminary prospectus or final
prospectus or application or document in reliance upon and in conformity with
information furnished in writing to the Company in connection therewith by any
such Seller of Registrable Securities or its controlling person (in the case of
indemnification of such Seller or its controlling person), or any such
underwriter or its controlling person (in the case of indemnification of such
underwriter or its controlling person) expressly for use therein, or unless (B)
in the case of a sale directly by such Seller (including a sale of such
Registrable Securities through any underwriter retained by such Seller to engage
in a distribution on behalf of such Seller), such untrue statement or alleged
untrue statement or omission or alleged omission was contained in a preliminary
prospectus and corrected in a final or amended prospectus copies of which were
delivered to such Holder or such underwriter on a timely basis, and such Seller
failed to deliver a copy of the final or amended prospectus at or prior to the
confirmation for the sale of the Warrant Shares and other
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Registrable Securities to the person asserting any such loss, claim, damage or
liability in any case where such delivery is required by the Securities Act.
(ii) The term "Person," as used in this Section,
shall mean an individual, corporation, partnership, trust, university,
unincorporated organization, or other entity.
(iii) Promptly after receipt by any Seller, any
underwriter or any controlling Person of notice of the commencement of any
action in respect of which indemnity may be sought against the Company, such
Seller, or such underwriter or such controlling person, as the case may be, will
notify the Company in writing of the commencement thereof (provided, that
failure to so notify the Company shall not relieve the Company from any
liability it may have hereunder except to the extent that the Company's defense
of such action was materially adversely affected thereby), and, subject to the
provisions hereinafter stated, the Company shall be entitled to assume the
defense of such action (including the employment of counsel, who shall be
counsel reasonably satisfactory to such Seller, of such underwriter or such
controlling Person, as the case may be), and shall assume the payment of
expenses insofar as such action shall relate to any alleged liability in respect
of which indemnity may be sought against the Company.
(iv) Such Seller, any such underwriter or any
such controlling Person shall have the right to employ separate counsel in any
such action and to participate in the defense thereof but the fees and expenses
of such counsel subsequent to any assumption of the defense by the Company shall
not be at the expense of the Company unless the employment of such counsel has
been specifically authorized in writing by the Company, the Company shall not
have employed counsel to defend such action or such indemnified party or parties
shall have reasonably concluded that there may be defenses available to it or
them which are different from or additional to those available to the Company
(in which case the Company shall not have the right to direct the defense of
such action on behalf of the indemnified party or parties) in any of which
events the fees and expenses of not more than one additional firm of attorneys
for the Seller(s) and/or such underwriter or controlling person shall be borne
by the Company. The Company shall not be liable to indemnify any Person for any
settlement of any such action effected without the Company's written consent.
The Company shall not, except with the approval of each party being indemnified
under this paragraph (d), consent to entry of any judgment or enter into any
settlement which does not include as an unconditional term thereof the giving by
the claimant or plaintiff to the parties being so indemnified of a release from
all liability in respect to such claim or litigation.
(v) In order to provide for just and equitable
contribution to joint liability under the Securities Act in any case in which
any participating Holder exercising rights under this Section 7, or any
controlling Person of any such Holder, makes a claim for indemnification
pursuant to this paragraph (d) but it is judicially determined (by the entry of
a final judgment or decree by a court of competent jurisdiction and the
expiration of time to appeal or the denial of the last right of appeal) that
such indemnification may not be enforced in such case notwithstanding the fact
that this paragraph (d) provides for indemnification in such case, then, the
Company and such Seller will contribute to the aggregate losses, claims, damages
or liabilities to which they may be subject (after contribution from others) in
such proportion as is appropriate to reflect the relative fault of the Company
on the one hand and of the Seller on the other in connection
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with the statements or omissions which resulted in such losses, claims, damages
or liabilities, as well as any other relevant equitable considerations. The
relative fault of the Company on the one hand and of the Seller on the other
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact relates to information supplied by the Company on the one
hand or by the Seller on the other, and each party's relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission; provided, however, that, in any such case, (A) no such Seller will be
required to contribute any amount in excess of the public offering price of all
such Registrable Securities offered by such Seller pursuant to such registration
statement; and (B) no person or entity guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) will be entitled to
contribution from any person or entity who was not guilty of such fraudulent
misrepresentation.
(e) EXCHANGE ACT REGISTRATION. If the Company at any
time shall list any class of equity security on any national securities exchange
and shall register such class of equity securities under the Exchange Act, the
Company shall, at its expense, simultaneously list on such exchange and maintain
such listing of, the Registrable Securities. The Company shall use its
commercially reasonable efforts to timely file with the Commission such
information as the Commission may require under Section 13 or Section 15(d) of
the Exchange Act; and in such event, the Company shall use its commercially
reasonable efforts to take all action as may be required as a condition to the
availability of Rule 144 or Rule 144A under the Securities Act (or any successor
exemptive rule hereinafter in effect) with respect to such Registrable
Securities. The Company shall furnish to the Holder forthwith upon request (i) a
written statement by the Company as to its compliance with the reporting
requirements of Rule 144, (ii) a copy of the most recent annual or quarterly
report of the Company as filed with the Commission, and (iii) such other reports
and documents as the Holder may reasonably request in availing itself of any
rule or regulation of the Commission allowing the Holder to sell any such
Registrable Securities without registration. The Company agrees to use its
commercially reasonable efforts to facilitate and expedite transfers of
Registrable Securities pursuant to Rule 144 under the Securities Act, which
efforts shall include timely notice to its transfer agent to expedite such
transfers.
(f) HOLDER INDEMNIFICATION
(i) In the event that the Company registers any
of the Registrable Securities under the Securities Act, each Holder of
Registrable Securities so registered shall indemnify and hold harmless the
Company, each of its directors, each of its officers who have signed or
otherwise participated in the preparation of the registration statement, each
underwriter of the Registrable Securities so registered (including any broker or
dealer through whom such of the shares may be sold) and each Person, if any, who
controls the Company within the meaning of Section 15 of the Securities Act,
from and against any and all losses, claims, damages, expenses or liabilities,
joint or several, to which they or any of them may become subject under the
Securities Act, applicable state securities laws or under any other statute or
at common law or otherwise, and, except as hereinafter provided, shall reimburse
the Company and each such director, officer, underwriter, broker, dealer or
controlling Person for any legal or other expenses reasonably incurred by them
or any of them in connection with investigating or defending any actions whether
or not resulting in
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any liability, insofar as such losses, claims, damages, expenses, liabilities or
actions arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the registration statement, in any
preliminary or amended preliminary prospectus or in the final prospectus (or in
the registration statement or prospectus as from time to time amended or
supplemented) or arise out of or are based upon the omission or alleged omission
to state therein a material fact required to be stated therein or necessary in
order to make the statements therein not misleading, but only insofar as any
such statement or omission was made in reliance upon and in conformity with
information furnished in writing to the Company in connection therewith by such
Holder expressly for use therein; provided, however, that such Holder's
obligations hereunder shall be limited to an amount equal to the proceeds
received by such Holder sold in such registration.
(ii) Promptly after receipt of notice of the
commencement of any action in respect of which indemnity may be sought against
such Holder, the Company will notify such Holder in writing of the commencement
thereof (provided, that failure to so notify such Holder shall not relieve such
Holder from any liability it may have hereunder except to the extent that such
Holder's defense of such action was materially adversely affected thereby), and
such Holder shall, subject to the provisions hereinafter stated, be entitled to
assume the defense of such action (including the employment of counsel, who
shall be counsel reasonably satisfactory to the Company) and the payment of
expenses insofar as such action shall relate to the alleged liability in respect
of which indemnity may be sought against such Holder of Registrable Securities.
The Company and each such director, officer, underwriter or controlling Person
shall have the right to employ separate counsel in any such action and to
participate in the defense thereof, but the fees and expenses of such counsel
subsequent to any assumption of the defense by such Holder shall not be at the
expense of such Holder unless engagement of such counsel is specifically
authorized in writing by such Holder. Such Holder shall not be liable to
indemnify any Person for any settlement of any such action effected without such
Holder's written consent.
(iii) In order to provide for just and equitable
contribution to joint liability under the Securities Act in any case in which
the Company's exercise of its rights under this Section 7(f) makes a claim for
indemnification pursuant to this Section 7(f), but it is judicially determined
(by the entry of a final judgment or decree by a court of competent jurisdiction
and the expiration of time to appeal or the denial of the last right of appeal)
that such indemnification may not be enforced in such case notwithstanding that
this Section 7(f) provides for indemnification, in such case, then, the Company
and such Holder will contribute to the aggregate losses, claims, damages or
liabilities to which they may be subject (after contribution from others) in
such proportion as is appropriate to reflect the relative fault of the Company
on the one hand and of the Holder on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative fault of the
Company on the one hand and of the Holder on the other shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or omission or alleged omission to state a material fact
relates to information supplied by the Company on the one hand or by the Holder
on the other, and each party's relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission; provided,
however, that, in any such case, (i) no such Holder will be required to
contribute any amount in excess of the public offering price of all such
Registrable Securities offered by it pursuant to such
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registration statement; and (ii) no person or entity guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
will be entitled to contribution from any person or entity who was not guilty of
such fraudulent misrepresentation.
(g) SALES THROUGH UNDERWRITERS. In connection with
any registration made pursuant to Section 7(a) or 7(b) hereof, the Holders(s) of
the Warrant Shares agree(s) as follows: (i) any public sale of the Warrant
Shares of the Holder(s) included in such registration statement shall be
effected through the underwriter, if any, for such registration and (ii) the
Holders(s) shall compensate the underwriter in accordance with the underwriter's
customary compensation practices for such transactions.
(h) STOCKHOLDER ACTS. Whenever under the preceding
provisions of this Section 7 the Holder is registering any Warrant Shares
pursuant to any registration statement, the Holder agrees to timely provide to
the Company, at its request, such information and materials as the Company may
reasonably request in order to effect the registration of such Warrant Shares.
(i) NO REQUIRED EXERCISE. Nothing contained in this
Warrant shall be construed as requiring the Holder to exercise the Warrant prior
to the initial filing of any registration statement or the effectiveness
thereof.
(j) ASSIGNMENT OF REGISTRATION RIGHTS. The rights to
cause the Company to register Registrable Securities pursuant to this Section 7
may be assigned (but only with all related obligations) by the Holder to a
transferee or assignee, provided that: (i) the Company is, within a reasonable
time before such transfer, furnished with written notice of the name and address
of such transferee or assignee and the securities with respect to which such
registration rights are being assigned; (ii) such assignment shall be effective
only if immediately following such transfer the further disposition of such
securities by the transferee or assignee is restricted under the Securities Act;
(iii) the assignee, in the Company's judgment, is not a competitor of the
Company or any of its subsidiaries; and (iv) such assignment is not otherwise
prohibited by the terms of any lock-up agreement then in effect with respect to
the Warrants or any Registrable Securities generally.
(k) DELAY OF REGISTRATION. No Holder shall have any
right to obtain or seek an injunction restraining or otherwise delaying any
registration as the result of any controversy that might arise with respect to
the interpretation or implementation of this Section 7.
8. CERTIFICATE OF ADJUSTMENT. Whenever the Warrant Price or
number or type of securities issuable upon exercise of this Warrant is adjusted,
as herein provided, the Company shall promptly deliver to the record Holder of
this Warrant a certificate of an officer of the Company setting forth the nature
of such adjustment and a brief statement of the facts requiring such adjustment.
9. TRANSFER OF WARRANT. This Warrant may not be transferred by
the Purchaser without the written consent of the Company. Notwithstanding the
foregoing, no such consent shall be necessary for a transfer by such Purchaser
to a shareholder or partner of such Purchaser, if the
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transferee or transferees agree in writing to be subject to the terms hereof to
the same extent as if they were the Purchaser hereunder.
10. REPLACEMENT OF WARRANTS. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft or destruction of any Warrant, on
delivery of an indemnity agreement or security reasonably satisfactory in form
and amount to the Company or, in the case of any such mutilation, on surrender
and cancellation of such Warrant, the Company at its expense will execute and
deliver, in lieu thereof, a new Warrant of like tenor.
11. SECURITIES LAW. As a condition to exercise of this
Warrant, the Holder (including any permitted assignee) shall be required to make
such representations and warranties and execute such documents as reasonably
requested by the Company in order for the Company to perfect an exemption from
the registration and qualification requirements of applicable securities laws.
12. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered personally or by
commercial messenger or courier service requiring signed acknowledgment of
delivery, or mailed by registered or certified mail (return receipt requested)
or sent via facsimile (with acknowledgment of complete transmission). If sent by
registered or certified mail, notice shall be deemed to have been received five
(5) days after mailing, if by overnight mail, one (1) day after being sent, or
upon actual receipt if sent by facsimile. All notices shall be addressed to the
parties at the following addresses (or at such other address for a party as
shall be specified by like notice):
to the Company: Dynacs Engineering Co., Inc.
35111 U.S. Highway 19 North
Suite 300
Palm Harbor, Florida 34684
Attn.: Dr. Ramendra P. Singh, President
with copies to: Frankfurt, Garbus, Klein & Selz, P.C.
488 Madison Avenue
New York, New York 10022
Attn.: Gary A. Schonwald, Esq.
to the Purchaser: To each Purchaser at the address set forth
on Schedule I of this Agreement.
with copies to: H.C. Wainwright & Co., Inc.
One Boston Place
40th Floor
Boston, MA 02108
Attn.: Matthew La Fontaine, Associate
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13. TERMINATION. The right to purchase securities upon
exercise of this Warrant shall terminate upon the earlier of (a) the fifth
anniversary date of the Issuance Date (as defined herein) or (b) the fourth
anniversary date of a Liquidity Event (as defined herein).
14. MISCELLANEOUS. This Warrant has been prepared, negotiated
and delivered in the State of New York and shall be governed by the laws of said
State. The headings in this Warrant are for purposes of convenience and
reference only, and shall not be deemed to constitute a part hereof. Neither
this Warrant nor any term hereof may be changed, waived, discharged or
terminated orally but only by an instrument in writing signed by the Company and
the registered Holder hereof. All notices and other communications from the
Company to the Holder shall be mailed by first class registered or certified
mail, postage prepaid, to the address furnished to the Company in writing by the
last Holder who shall have furnished an address to the Company in writing. The
invalidity or unenforceability of any provision hereof shall in no way affect
the validity or enforceability of any other provisions. The language in this
Warrant shall be construed as to its fair meaning, and not strictly for or
against the Company or the Holder. This Warrant, together with the related
Warrant and Senior Subordinated Convertible Note Purchase Agreement and the
Senior Subordinated Convertible Note, sets forth the final, complete and
exclusive statement of the terms and conditions between the parties pertaining
to the subject matter of this Warrant and supersedes all prior and
contemporaneous agreements or understandings with respect thereto.
ISSUED as of this __ day of ___________, 1999.
DYNACS ENGINEERING CO., INC.
By __________________________________
Title _______________________________
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Dynacs Engineering Co., Inc.
35111 U.S. Highway 19 North, Suite 300
Palm Harbor, Florida 34684
ELECTION TO EXERCISE
The undersigned hereby exercises his or its rights to purchase
Warrant Shares covered by the within Warrant and tenders payment
- ---------
herewith in the amount of $ in accordance with the terms thereof; and
-------
requests that certificates for such securities be issued in the name of, and
delivered to:
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
(Print Name, Address and Social Security or Tax Identification Number)
and, if such number of Warrant Shares shall not be all the
Warrant Shares covered by the within Warrant, that a new Warrant for the balance
of the Warrant Shares covered by the within Warrant be registered in the name
of, and delivered to, the undersigned at the address stated below.
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
(Print Name, Address and Social Security or Tax Identification Number)
Dated: Name:
------------------------- ---------------------------
(Print)
Address:
-------------------------------------------------------------
---------------------------------
(Signature)
---------------------------------
(Signature Guarantee)
---------------------------------
(Signature Guarantee)
15
<PAGE> 73
EXHIBIT C-1
<PAGE> 74
[LETTERHEAD OF FRANKFURT, GARBUS, KLEIN & SELZ]
November , 1999
To the Investors listed
on Schedule I to the Warrant and
Senior Sub. Con. Note Pur. Agmt.
dated the date hereof
H.C. Wainwright & Co., Inc.
One Boston Place, 40th Floor
Boston, MA 02108
Re: Dynacs Engineering Co., Inc.
Ladies and Gentlemen:
We have acted as special counsel for Dynacs Engineering Co., Inc., a
Florida corporation (the "Company"), in connection with its offer and sale of up
to $1,000,000 million in principal amount of twelve-month Senior Subordinated
Convertible Promissory Notes (the "Notes") and warrants to purchase up to
150,000 shares of the Company's common stock, par value $.01 per share (the
"Warrants") pursuant to a private placement conducted by H.C. Wainwright & Co.,
Inc. acting as placement agent (the "Placement Agent") as more fully described
in the Confidential Offering Memorandum, dated October 1999, which includes a
term sheet, the October 22, 1999 draft of the Company's Registration Statement
on Form S-1, and the forms of (i) the Warrant and Senior Subordinated
Convertible Note Purchase Agreement, dated as of the date hereof, by and among
the Company and the purchasers of Notes and Warrants named on Schedule J thereto
(the "Investors"), (ii) the Warrants and (iii) the Notes (the "Offering
Memorandum"). The Warrant and Senior Subordinated Convertible Note Purchase
Agreement is referred to herein as the "Agreement." The transactions
contemplated by the Offering Memorandum and the Agreement are referred to herein
as the "Transactions."
This opinion is furnished to you on behalf of the Company pursuant to
Section 5.2(d) of the Agreement. Capitalized terms used herein which are not
otherwise defined shall have the respective meanings ascribed to them in the
Agreement.
<PAGE> 75
Investors and
H.C. Wainwright & Co., Inc.
November , 1999
Page 2
In such capacity, we have examined the following documents and agreements
as executed by the Company in connection with the Transactions:
(i) the Agreement;
(ii) the Warrants, each dated the date hereof;
(iii) the Notes, each dated the date hereof;
(iv) the Subordination Acknowledgment and Agreements between the Company
and each of the unsecured debt holders listed on Schedule 1 to this opinion
(the "Subordination Agreements");
(v) the Waiver of Preemptive Rights, dated November 1, 1999, executed by
the representative of the holders of outstanding common stock of the
Company's subsidiary, Cerulean FXs, Inc. ("Cerulean"), a copy of which
waiver (the "Cerulean Waiver") is attached to this Opinion; and
(v) the Offering Memorandum.
We have also reviewed the Individual Guaranty, dated the date hereof, of
Ramendra P. Singh in favor of the Investors (the "Guaranty"). The documents,
instruments and agreements set forth in clauses (i) through (v) are referred to
in this opinion letter collectively as the "Transaction Documents."
In addition, we have examined and relied upon such other documents,
instruments and records as we have deemed necessary for purposes of rendering
this opinion. Such documents, instruments and records, together with the
Transaction Documents and the Guaranty, are referred to in this opinion letter
collectively, as the "Reviewed Documents."
Insofar as the opinions expressed herein relate to factual matters,
information with respect to which is in the possession of the Company, we have
relied, with your permission, upon a certificate of Ramendra Singh, President
and Chief Executive Officer of the Company, annexed hereto, and upon statements
and representations of other officers and other representatives of the Company
and upon the Company's duly authorized representatives' and officers'
representations and warranties contained in the Reviewed Documents. No facts or
circumstances have come to our attention (but without our having made any
investigations for such purpose) that would cause us to believe that any such
representations, warranties or statements which are relevant to the opinions
expressed in this opinion letter and upon which we are relying in rendering
this opinion are inaccurate in any respect.
<PAGE> 76
Investors and
H.C. Wainwright & Co., Inc.
November__, 1999
Page 3
The opinion contained in paragraph 8 below is furnished to you on behalf of
Ramendra P. Singh (the "Guarantor") solely in connection with his execution and
delivery of the Guaranty. In such capacity, we have examined the Guaranty as
executed by the Guarantor.
We are members of the Bar of the State of New York and we do not purport to
be experts in, and we do not express any opinion herein concerning, any laws
other than the laws of the State of New York and the federal laws of the United
States of America, as currently in effect. We have relied on the opinion of
Litow, Cutler, Zabludowski & Allen dated the date hereof with respect to the
matters referred to therein, and we have assumed the correctness of the opinions
expressed therein insofar as they affect our opinions herein. In addition, our
opinion is limited to the matters expressly set forth herein, and no opinion is
implied or may be inferred beyond such matters. No opinion is rendered herein
with respect to the effect or enforceability of any conflicts of laws provisions
of the Agreement, any other Transaction Document or the Guaranty, and we express
no opinion as to any representation or warranty of any party other than the
Company. We inform you that we have not heretofore represented the Guarantor.
Based upon such review and examinations, and upon the assumptions,
qualifications and exceptions set forth in this opinion letter, we are of the
opinion that:
1. The execution, delivery and performance of the Agreement have been duly
and validly authorized by the Company, the Agreement and the Subordination
Agreements are each the valid and binding obligation of the Company enforceable
against the Company in accordance with its terms, and the Notes and the Warrants
constitute valid and binding obligations of the Company enforceable against the
Company in accordance with their respective terms. The Warrants, the Notes, the
Warrants Shares and the Note Shares have been duly authorized for issuance, and
assuming payment therefor by the Investors in accordance with the terms of the
Transaction Documents, (i) the Warrants issued to the Investors are validly
issued, fully paid an non-assessable and the holders thereof are not subject to
personal liability to third parties solely by reason of being such holders,
(ii) the Notes issued to the Investors are duly authorized and validly issued,
and (iii) the Warrant Shares and the Note Shares, if and when issued, will be
validly issued, fully paid and non-assessable and the holders thereof will not
be subject to personal liability to third parties solely by reason of being such
holders. All corporate action required to be taken for the authorization,
issuance and sale of the Warrants and the Notes and the authorization, issuance
and sale of the Warrant Shares and the Note Shares in accordance with the terms
of the Transaction Documents have been duly and validly taken by the Company.
The Notes, the Warrants, the Warrant Shares, and the Note Shares are not subject
to any preemptive rights, created by statute, of any security holder of the
Company, and, to our knowledge, such securities are not subject to contractual
preemptive rights of any other party,
<PAGE> 77
Investors and
H.C. Wainwright & Co., Inc.
November , 1999
Page 4
except the preemptive rights of the holders of shares of common stock of
Cerulean, pursuant to that certain Exchange Agreement, dated as of August 13,
1999, by and among the Company, Ramendra P. Singh, Michael Burns, William
Dallas, Jon Feltheimer and Offense Group Associates, LP (the "Exchange
Agreement"), which preemptive rights (the "Cerulean Holders' Rights"), have
been waived pursuant to Cerulean Waiver.
2. The Company has been duly organized as a corporation under the laws of
the State of Florida and is in good standing in such State. The Company is duly
qualified to do business as a foreign corporation and is in good standing in
each state of the United States in which the failure to so qualify or be in
good standing would have a material adverse effect on the business of the
Company and its subsidiaries, taken as a whole. The Company has all requisite
corporate power and corporate authority to own or lease its properties and
assets and to conduct its business as currently conducted.
3. All of the outstanding capital stock of the Company has been duly
authorized, validly issued and, to our knowledge, is fully paid and
non-assessable. To our knowledge, the holders of the outstanding capital stock
of the Company have no contractual rights of rescission or contractual
preemptive rights with respect to their shares, other than the Cerulean Holders'
Rights, and none of such securities was issued in violation of the contractual
preemptive rights of any holder of any security of the Company. The holders of
the outstanding capital stock of the Company are not subject to statutory
personal liability solely by reason of being such holders and none of such
outstanding capital stock was issued in violation of the statutory preemptive
rights of any holder of any security of the Company.
4. To our knowledge, neither the Company nor any domestic Subsidiary is in
breach of, or in default under, any term or provision of any indenture,
mortgage, deed of trust, lease, note, loan or credit agreement or any other
agreement or instrument evidencing an obligation for borrowed money, or any
other agreement or instrument to which it is a party or by which it or any of
its properties may be bound or affected. To our knowledge, neither the Company
nor any domestic Subsidiary is in violation of any provision of its charter or
Bylaws or in violation of any franchise, license, permit, judgment, decree or
order, or in violation of any state or Federal statute, rule or regulation
except as disclosed in the Agreement. To our knowledge, neither the execution
and delivery of the Agreement, nor the issuance and sale or delivery of the
securities nor the consummation of any of the transactions contemplated in the
Agreement, nor the compliance by the Company with the terms and provisions
thereof, has conflicted with, or has resulted in a breach of, any of the terms
and provisions of, or has constituted a default under, or has resulted in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of its domestic Subsidiaries or pursuant to the
terms of any
<PAGE> 78
Investors and
H.C. Wainwright & Co., Inc.
November , 1999
Page 5
indenture, mortgage, deed of trust, note, loan or credit agreement or any other
agreement or instrument evidencing an obligation for borrowed money, or any
other agreement or instrument to which the Company may be bound or to which any
of the property or assets of the Company is subject. The execution, delivery
and performance by the Company of each of the Transaction Documents and the
consummation by the Company of the Transactions do not (a) contravene the
Company's articles of incorporation or by-laws or (b) to our knowledge, violate
any law, statute, rule, regulation order, writ, judgment, injunction, decree,
determination or award, the violation or breach of which could reasonably be
expected to have a material adverse effect on the business of the Company and
its subsidiaries, taken as a whole.
5. To the best of our knowledge, no authorization, approval or other
action by, and no notice to or filing with, any governmental authority or
regulatory body is required for the due execution, delivery and performance by
the Company of any of the Transaction Documents.
6. To the best of our knowledge, there are no claims, actions, suits,
investigations or proceedings before or by any arbitrator, court, governmental
authority or instrumentality pending or threatened against or affecting the
Company or involving the properties of the Company, other than the Arbitration
Proceedings and the Employment Litigation, which might materially and adversely
affect the business, properties, or financial condition of the Company and its
subsidiaries, taken as a whole.
7. We have participated in the preparation of the Offering Memorandum and
the Transaction Documents (collectively, the "Offering Documents"), including
without limitation participation in conferences with officers and other
representations and have reviewed the Reviewed Documents, and although we do not
pass upon and do not assume responsibility for the accuracy, completeness or
fairness of the statements contained in the Offering Documents, nothing has come
to our attention to cause us to have reason to believe that any of the Offering
Documents contains any untrue statement of a material fact required to be stated
therein or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, provided, however, that we are not
expressing any opinion with respect to (i) the financial schedules, financial
statements, notes thereto and other financial information and statistical data
contained therein, including, without limitation, the summary financial
information and any financial forecasts or projections.
8. The Guaranty constitutes the legal, valid and binding obligation of the
Guarantor enforceable against the Guarantor in accordance with its terms.
<PAGE> 79
Investors and
H.C. Wainwright & Co., Inc.
November , 1999
Page 6
9. Assuming (i) that each Investor that purchases Notes and Warrants is an
Accredited Investor, (ii) that the representations made by the Company and the
Investors in the Agreement were true and correct on the date of such Agreement
and at the time of the Closing, (iii) that a Form D will be filed in accordance
with the provisions of Section 503 of Regulation D, (iv) that H.C. Wainwright
and any other parties acting at the request of H.C. Wainwright as a co-placement
agent complies with the requirements of Sections 4(2), Regulation D or 4(6) of
the Securities Act of 1933, as amended, no registration under the Securities Act
is required in connection with the sale and issuance of any of the securities.
The offering and sale of the securities in the manner contemplated by the
Agreement will not be integrated with any offering made before the offer and
sale of such securities in a manner that would render unavailable any exemption
from registration under the Securities Act.
In our examination of the Reviewed Documents, we have assumed the
following:
(a) the signatures of all parties (other that the Company) contained in
such Reviewed Documents are genuine signatures of the parties purporting to
have signed the same, and all persons signing such Reviewed Documents had, at
the time of such signing, full legal capacity to sign and deliver such Reviewed
Documents;
(b) the legal capacity of each signatory (other than the Company) to such
Reviewed Documents;
(c) the authenticity and accuracy of all documents submitted to us as
originals and the conformity to original documents of all Reviewed Documents
submitted to us as originals and the conformity to original documents of all
Reviewed Documents submitted to us as certified or photostatic copies;
(d) the Transaction Documents are the valid and legally binding obligations
of each party thereto other than the Company and are enforceable against each
such party other than the Company in accordance with their respective terms.
(e) no action has been taken which amends, revokes or otherwise effects
any of the Reviewed Documents;
(f) the Transaction Documents and the Guaranty accurately describe and
contain the full understanding of all parties thereto, including the Company,
and there are no oral or written statements or agreements by any party that
modify, amend, vary or waive, or purport to modify, amend, vary or waive, any of
the terms of any Transaction Document; and
<PAGE> 80
Investors and
H.C. Wainwright & Co., Inc.
November , 1999
Page 7
(g) the facts and law governing the future performance by the Company of
its obligations under the Transaction Documents will be identical to the facts
and law governing the Company's performance of the Transaction Documents on the
date of this opinion letter.
Although we have not conducted an independent investigation of the accuracy or
reasonableness of any of these assumptions, nothing has come to our attention
leading us to question the accuracy of any of the above assumptions.
Any reference to any of the terms, "our knowledge," "knowledge, " or "our
best knowledge," or to any matters "known to us," "coming to our attention" or
"of which we are aware," or any variation of any of the foregoing shall mean
the conscious awareness, as to the existence or absence of any facts which
would contradict any assumption or opinion set forth in this opinion letter, of
those attorneys of this firm who have rendered substantive attention to the
Company or any of its Subsidiaries or the Guarantor. Except as specifically
set forth in this opinion letter, we have not undertaken any independent
investigation to determine the existence or absence of such facts, and no
inference as to our knowledge of the existence or absence of such facts should
be drawn from the fact of our representation of the Company or the Guarantor.
Moreover, without limiting the generality of the foregoing and except as
specifically provided in this opinion letter, we have not searched any
computerized or electronic data bases or the dockets or records of any court,
regulatory body or governmental agency or other filing office (including,
without limitation, the U.S. Patent and Trademark Office) in any jurisdiction.
The opinions set forth in this opinion letter are subject to the
following additional qualifications, limitations and exceptions:
(a) The opinions concerning the validity, legally binding nature or
enforceability of any provision of any Transaction Document are subject to
(i) the application of bankruptcy, insolvency, avoidance, usury, bulk
transfer, reorganization, moratorium or other laws affecting the rights and
remedies of creditors, including, without limitation, any statutory or
other law regarding fraudulent transfers or conveyances, (ii) the
application of equitable principles and public policy considerations
(including, without limitation, principles of commercial reasonableness,
good faith and fair dealing) regardless of whether such principles and
considerations are considered in a proceeding in equity or at law, (iii)
the effect of procedural due process, and (iv) the discretion of the court
or body before which any proceeding therefor may be brought, including,
without limitation, the court's failure or refusal to enforce provisions of
agreements or other documents if enforcement thereof is based upon defaults
or breaches which are immaterial to the ultimate performance contemplated
thereby or for other reasons deemed
<PAGE> 81
Investors and
H.C. Wainwright & Co., Inc.
November __, 1999
Page 8
equitable by the court; furthermore, no opinion is expressed as to whether
any such provision is specifically enforceable in equity.
(b) The unenforceability, under certain circumstances, of terms of
any of the Transaction Documents and the Guaranty providing for
indemnification of or contribution to a party where such indemnification
or contribution is contrary to public policy;
(c) We express no opinion as to (i) prospective waivers of (i) rights
to any notice or hearing, (ii) provisions purporting to establish
evidentiary standards, or (iii) rights to the extent any such waivers
violate matters of public policy.
(d) We express no opinion as to the enforceability, in any particular
circumstance, of any provision of the Transaction Documents or the
Guaranty which provides for the severability of illegal or unenforceable
provisions.
This opinion is solely for your benefit and, without our prior written
consent, shall not be quoted in whole or in part, summarized or otherwise
referred to, relied upon or filed with or supplied to any other person or
entity, except that you may deliver copies of this opinion to (i) your attorneys
acting on your behalf in connection with the Agreement and the transactions
contemplated thereby, (ii) governmental regulatory agencies having jurisdiction
over you to the extent that disclosure of the opinion is required by applicable
law or regulation, (iii) designated persons pursuant to order or other legal
process of any court or governmental agency or authority of competent
jurisdiction, (iv) Investors and prospective investors in the Notes and the
Warrants, and (v) the National Association of Securities Dealers, Inc.
We assume no obligation to supplement or update this opinion to reflect
any facts or circumstances which may hereafter come to our attention or any
changes in any laws or court decisions which may hereafter occur.
Sincerely yours,
FRANKFURT, GARBUS, KLEIN & SELZ
<PAGE> 82
EXHIBIT C-2
<PAGE> 83
November 4, 1999
The Investors listed on Schedule I
to the Warrant and Senior Sub. Con.
Note Pur. Agmt. dated the date hereof
H.C. Wainwright & Co., Inc.
One Boston Place, 40th Floor
Boston, MA 02108
Re: Dynacs Engineering Co., Inc.
Ladies and Gentlemen:
We have acted as special counsel for Dynacs Engineering Co., Inc., a
Florida corporation (the "Company"), in connection with it's offer and sale of
up to $1,000,000 million in principal amount of twelve-month Senior
Subordinated Convertible Promissory Notes (the "Notes") and warrants to
purchase up to 150,000 shares of the Company's common stock, par value $.01 per
share (the "Warrants") pursuant to a private placement conducted by H.C.
Wainwright & Co., Inc. acting as placement agent (the "Placement Agent") as
more fully described in the Confidential Offering Memorandum dated October 1999,
which includes a term sheet, the October 22, 1999 draft of the Company's
Registration Statement on Form S-1, and the forms of (i) the Warrant and Senior
Subordinated Convertible Note Purchase Agreement, dated as of the date hereof,
by and among the Company and the purchasers of Notes and Warrants named on
Schedule I thereto (the "Investors"), (ii) the Warrants and (iii) the Notes
(the "Offering Memorandum"). The Warrant and Senior Subordinated Convertible
Note Purchase Agreement is referred to herein as the "Agreement." The
transactions contemplated by the Offering Memorandum and the Agreement are
referred to herein as the "Transactions."
This opinion is furnished to you on behalf of the Company pursuant to
Section 5.2(d) of the Agreement. Capitalized terms used herein which are not
otherwise defined shall have the respective meanings ascribed to them in the
Agreement.
In such capacity, we have reviewed the following documents and agreements
as executed by the Company in connection with the Transactions:
(i) the Agreement;
(ii) the Warrants, each dated the date hereof;
(iii) the Notes, each dated the date hereof;
(iv) the Subordination Acknowledgment and Agreements between the Company
and each of the unsecured debt holders listed on Schedule I to this
opinion (the "Subordination Agreements");
<PAGE> 84
Investors listed on Schedule 1 to Agmt
H.C. Wainwright & Co., Inc.
November 4, 1999
Page 2
(v) the Waiver of Preemptive Rights, dated November 1, 1999, executed by
the representatives of the holders of outstanding common stock of the
Company's subsidiary, Cerulean FXs, Inc. ("Cerulean"), a copy of
which waiver (the "Cerulean Waiver") is attached to this Opinion; and
(vi) the Offering Memorandum;
We have reviewed the corporate resolutions of the Company's Board of
Directors with regard to the Transactions (the "Resolutions"). We have also
reviewed the Individual Guaranty, dated the date hereof, of Ramendra P. Singh
in favor of the Investors (the "Guaranty"). The documents, instruments and
agreements set forth in clauses (i) through (v) immediately above, together
with the Resolutions, are referred to in this opinion letter collectively as
the "Transaction Documents."
In addition, we have reviewed and relied upon such other documents,
instruments, certificates and records as we have deemed necessary for purposes
of rendering this opinion. Such documents, instruments and records, together
with the Guaranty, the Offering Memorandum and the Transaction Documents, are
referred to in this opinion letter collectively, as the "Reviewed Documents."
Insofar as the opinions expressed herein relate to factual matters,
information with respect to which is in the possession of the Company or any of
its Subsidiaries, we have relied, with your permission, upon certificates,
statements and representations of officers and other representatives of the
Company and its subsidiaries and upon the Company's duly authorized
representatives' and officers' representations and warranties contained in the
Reviewed Documents. No facts or circumstances have come to our attention (but
without our having made any investigations for such purpose) that would cause
us to believe that any such representations, warranties or statements which are
relevant to the opinions expressed in this opinion letter and upon which we are
relying in rendering this opinion are inaccurate in any respect.
We are members of the Bar of the State of Florida and we do not purport to
be experts in, and we do not express any opinion herein concerning, any laws
other than the laws of the State of Florida as currently in effect, nor do we
purport to be experts in the other areas of law which relate to the
Transactions. We have relied on the opinion of Frankfurt, Garbus, Klein & Selz
dated the date hereof with respect to the enforceability of the Transaction
Documents under New York law and as to matters of Federal and New York state
securities law, and we have assumed the correctness of the opinions expressed
therein insofar as they affect our opinions herein. In addition, our opinion is
limited to the matters expressly set forth herein, and no opinion is implied or
may be inferred beyond such matters. In addition, we express no opinion as to
Florida securities laws, rules and regulations, including, but not limited to,
the compliance of the Transactions and/or the Transaction Documents therewith.
No opinion is rendered herein with respect to the effect or enforceability of
any conflicts of laws provisions of the Agreement, any other Transaction
<PAGE> 85
Investors listed on Schedule 1 to Agmt
H.C. Wainwright & Co., Inc.
November 4, 1999
Page 3
Document or the Guaranty, and we express no opinion as to any representation or
warranty of any party other than the Company.
Based upon such review and examinations, and upon the assumptions,
qualifications and exceptions set forth in this opinion letter, we are of the
opinion that:
1. The Company has been duly organized as a Florida corporation under
the laws of the State of Florida and is in good standing in said State.
2. The Company has all requisite corporate power and corporate authority
to own or lease its properties and assets and to conduct its business as
currently conducted.
3. All of the outstanding capital stock of the Company has been duly
authorized and validly issued and, to our knowledge, is fully paid and
non-assessable. To our knowledge, the holders of the outstanding capital stock
of the Company have no contractual rights of rescission or contractual
preemptive rights with respect to their shares, other than the Cerulean
Holders' Rights, as defined below, and none of such securities was issued in
violation of the contractual preemptive rights of any holder of any security of
the Company. The holders of the outstanding capital stock of the Company are
not subject to statutory personal liability solely by reason of being such
holders and none of such outstanding capital stock was issued in violation of
the statutory preemptive rights of any holder of any security of the Company and
none of the holders of such outstanding capital stock has any statutory
preemptive rights.
4. The execution, delivery and performance by the Company of each of the
Transaction Documents and the consummation by the Company of the Transactions
do not contravene the Company's articles of incorporation or by-laws, each as
the same may have been amended to date.
5. The execution, delivery and performance of the Agreement have been
duly and validly authorized by the Company, the Agreement and the Subordination
Agreements are each the valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, and the Notes and
the Warrants constitute valid and binding obligations of the Company
enforceable against the Company in accordance with their respective terms. The
Warrants, the Notes, the Warrant Shares and the Note Shares have been duly
authorized for issuance, and assuming payment therefor by the Investors in
accordance with the terms of the Transaction Documents, (i) the Warrants issued
to the Investors are validly issued, fully paid an non-assessable and the
holders thereof are not subject to personal liability to third parties solely
by reason of being such holders, (ii) the Notes issued to the Investors are
duly authorized and validly issued, and (iii) the Warrant Shares and the Note
Shares, if and when issued, will be validly issued, fully paid and
non-assessable and the holders thereof will not be subject to personal
liability to third parties solely by reason of being such holders. All
corporate action required to be taken for the authorization, issuance and sale
of
<PAGE> 86
Investors listed on Schedule 1 to Agmt
H.C. Wainwright & Co., Inc.
November 4, 1999
Page 4
the Warrants and the Notes and the authorization, issuance and sale of the
Warrant Shares and the Note Shares in accordance with the terms of the
Transaction Documents have been duly and validly taken by the Company. The
Notes, the Warrants, the Warrant Shares, and the Note Shares are not subject to
any preemptive rights, created by statute, of any security holder of the
Company, and, to our knowledge, such securities are not subject to contractual
preemptive right of any other party, except the preemptive rights of the
holders of shares of common stock of Cerulean, pursuant to that certain
Exchange Agreement, dated as of August 13, 1999, by and among the Company,
Ramendra P. Singh, Michael Burns, William Dallas, Jon Feltheimer and Offense
Group Associates, LP (the "Exchange Agreement"), which preemptive rights (the
"Cerulean Holders' Rights"), have been waived pursuant to Cerulean Waiver.
6. To our knowledge, neither the Company nor any domestic Subsidiary is in
breach of, or in default under, any term or provision of any indenture,
mortgage, deed of trust, lease, note, loan or credit agreement or any other
agreement or instrument evidencing an obligation for borrowed money, or any
other agreement or instrument to which it is a party or by which it or any of
its properties may be bound or affected. To our knowledge, neither the company
nor any domestic Subsidiary is in violation of any provision of its charter or
Bylaws or in violation of any franchise, license, permit, judgment, decree or
order, or in violation of any state or Federal statute, rule or regulation
except as disclosed in the Agreement. To our knowledge, neither the execution
and delivery of the Agreement, nor the issuance and sale or delivery of the
securities nor the consummation of any of the transactions contemplated in the
Agreement, nor the compliance by the Company with the terms and provisions
thereof, has conflicted with, or has resulted in a breach of, any of the terms
and provisions of, or has constituted default under, or has resulted in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of its domestic Subsidiaries or pursuant to the
terms of any indenture, mortgage, deed of trust, note, loan or credit agreement
or any other agreement or instrument evidencing an obligation for borrowed
money, or any other agreement or instrument to which the Company may be bound or
to which any of the property or assets of the Company is subject. The execution,
delivery and performance by the Company of each of the Transaction Documents and
the consummation by the Company of the Transactions do not (a) contravene the
Company's articles of incorporation or by-laws or (b) to our knowledge, violate
any law, statute, rule, regulation order, writ, judgment, injunction, decree,
determination or award, the violation or breach of which could reasonably be
expected to have a material adverse effect on the business of the Company and
its subsidiaries, taken as a whole.
7. To the best of our knowledge, no authorization, approval, or action by,
and no notice to or filing with, any governmental authority or regulatory
body of Florida is required for the due execution, delivery and performance by
the Company of any of the Transaction Documents.
8. To the best of our knowledge, there are no claims, actions, suits,
investigations or proceedings before or by any arbitrator, court, governmental
authority or instrumentality pending or
<PAGE> 87
Investors listed on Schedule 1 Agmt
H.C. Wainwright & Co., Inc.
November 4, 1999
Page 5
threatened against or affecting the Company or involving the properties of the
Company, other than the Arbitration Proceedings and the Employment Litigation,
which might materially and adversely affect the business, properties, or
financial condition of the Company and its subsidiaries, taken as a whole.
In our review of the Reviewed Documents, we have assumed the following:
(a) the signatures of all parties (other than the Company) contained in
such Reviewed Documents are genuine signatures of the parties
purporting to have signed the same, and all persons signing such
Reviewed Documents had, at the time of such signing, full legal
capacity to sign and deliver such Reviewed Documents;
(b) the legal capacity of each signatory (other than the Company) to such
Reviewed Documents;
(c) the authenticity and accuracy of all documents submitted to us as
originals and the conformity to original documents of all Reviewed
Documents submitted to us as originals and the conformity to original
documents of all Reviewed Documents submitted to us as certified or
photostatic copies;
(d) no action has been taken which amends, revokes or otherwise effects
any of the Reviewed Documents;
(e) the facts and law governing the future performance by the Company of
its obligations under the Transaction Documents will be identical to
the facts and law governing the Company's performance of the
Transaction Documents on the date of this opinion letter.
(f) the Transaction Documents are the valid and legally binding
obligations of each party thereto other than the Company and are
enforceable against each such party other than the Company in
accordance with their respective terms;
(g) the Transaction Documents and the Guaranty accurately describe and
contain the full understanding of all parties thereto, including the
Company, and there are no oral or written statements or agreements by
any party that modify, amend, vary or waive, or purport to modify,
amend, vary or waive, any of the terms of any Transaction Documents;
and
We have not conducted an independent investigation of the accuracy or
reasonableness of any of these assumptions, and nothing has come to our
attention leading us to question the accuracy of any of the above assumptions.
<PAGE> 88
Investors listed on Schedule 1 to Agmt
H.C. Wainwright & Co., Inc.
November 4, 1999
Page 6
Any reference to any of the terms, "our knowledge" or "the best of our
knowledge" or to any matters "known to us," "coming to our attention" or "of
which we are aware," or any variation of any of the foregoing shall mean the
conscious awareness, as to the existence or absence of any facts which would
contradict any assumption or opinion set forth in this opinion letter, of those
attorneys of this firm who rendered substantive attention to the Company or any
of its subsidiaries. Except as specifically set forth in this opinion letter,
we have not undertaken any independent investigation to determine the existence
or absence of such facts, and no inference as to our knowledge of the existence
or absence of such facts should be drawn from the fact of our representation of
the Company. Moreover, without limiting the generality of the foregoing and
except as specifically provided in this opinion letter, we have not searched
any computerized or electronic data bases or the dockets or records of any
court, regulatory body or governmental agency or other filing office in any
jurisdiction.
The opinions set forth in this opinion letter are subject to the following
additional qualifications, limitations and exceptions:
(a) The opinions concerning the validity, legally binding nature or
enforceability of any provision of any Transaction Document are subject to
(i) the application of bankruptcy, insolvency, avoidance, usury, bulk
transfer, reorganization, moratorium or other laws affecting the rights and
remedies of creditors, including, without limitation, any statutory or
other law regarding fraudulent transfers or conveyances, (ii) the
application of equitable principles and public policy considerations
(including, without limitation, principles of commercial reasonableness,
good faith and fair dealing) regardless of whether such principles and
considerations are considered in a proceeding in equity or at law, (iii)
the effect of procedural due process, and (iv) the discretion of the court
or body before which any proceeding therefor may be brought, including,
without limitation, the court's failure or refusal to enforce provisions of
agreements or other documents if enforcement thereof is based upon defaults
or breaches which are immaterial to the ultimate performance contemplated
thereby or for other reasons deemed equitable by the court; furthermore, no
opinion is expressed as to whether any such provision is specifically
enforceable in equity.
(b) We express no opinion as to the unenforceability, under certain
circumstances, of terms of any of the Transaction Documents providing for
indemnification of or contribution to a party where such indemnification or
contribution is contrary to public policy;
(c) We express no opinion as to (i) prospective waivers of (i) right
to any notice or hearing, (ii) provisions purporting to establish
evidentiary standards, or (iii) rights to the extent any such waivers
violate matters of public policy.
<PAGE> 89
Investors listed on Schedule 1 to Agmt
H.C. Wainwright & Co., Inc.
November 4, 1999
Page 7
(d) We express no opinion as to the enforceability, in any particular
circumstance, of any provision of the Transaction Documents or the Guaranty
which provides for the severability of illegal or unenforceable provisions.
This opinion is solely for your benefit and, without our prior written
consent, shall not be quoted in whole or in part, summarized or otherwise
referred to, relied upon or filed with or supplied to any other person or
entity, except that you may deliver copies of this opinion to (i) your attorneys
acting on your behalf in connection with the Agreement and the transactions
contemplated thereby, (ii) governmental regulatory agencies having jurisdiction
over you to the extent that disclosure of the opinion is required by applicable
law or regulation, (iii) designated persons pursuant to order or other legal
process of any court or governmental agency or authority of competent
jurisdiction, (iv) Investors and prospective investors in the Notes and the
Warrants, and (v) the National Association of Securities Dealers, Inc. Only the
addressees and Frankfurt, Garbus, Klein & Selz may rely in any way whatsoever
on all or any part of the contents hereof.
We assume no obligation to supplement or update this opinion to reflect any
facts or circumstances which may hereafter come to our attention or any changes
in any laws or court decisions which may hereafter occur. We do not render any
opinion by implication or any opinion with respect to matters other than those
expressly set forth above.
Sincerely yours,
LITOW, CUTLER & ZABLUDOWSKI, LLC
<PAGE> 90
EXHIBIT D
<PAGE> 91
INDIVIDUAL GUARANTY
GUARANTY, dated as of November 4, 1999, from ("Guarantor") to the
Investors as such term is defined in the Warrant and Senior Subordinated
Convertible Note Purchase Agreement dated November 4, 1999 (the "Agreement") by
and among the Investors and Dynacs Engineering Co., Inc. (the "Company").
For valuable consideration, the receipt of which is hereby acknowledged,
and to induce the Investors to loan the Company up to $1,000,000 evidenced by
certain Promissory Notes (the "Notes"), the undersigned Guarantor hereby agrees
as follows:
1. Guarantor acknowledges that he is fully aware of the terms and
conditions of the Notes and does hereby jointly and severally, irrevocably and
unconditionally, guarantee, as primary obligor and not as a surety merely,
without offset or deduction, the full and prompt payment when due of all sums
presently or hereafter owing by the Company to the Investors pursuant to the
Notes, whether arising by sale, note, assignment or otherwise (the payment of
all sums owning by the Company pursuant to the Notes being hereinafter referred
to as an "Obligation"). In the event that the Company fails to pay any
Obligation for any reason, Guarantor will pay or otherwise provide for and
bring about promptly when due the payment of such Obligation. This Guaranty
shall constitute a guaranty of payment and not of collection. Guarantor
specifically agrees that it shall not be necessary or required, and that
Guarantor shall not be entitled to require, that the Investors (a) file suit or
proceed to obtain or assert a claim for personal judgment against the Company
or any other person liable for any Obligation, (b) make any effort at
collection or other enforcement of any Obligation from or against the Company
or any other person, (c) foreclose against or seek to realize upon collateral
security now or hereafter existing for any Obligation, (d) exercise or assert
any other right or remedy to which the Investors are or may be entitled in
connection with any Obligation or any collateral security or other guaranty
thereof, or (e) assert or file any claim against the assets of the Company or
any other guarantor or other person liable for any Obligation, or any part
thereof, before or as a condition of requiring payment or performance of any
Obligation by Guarantor hereunder, or at any time hereunder.
2. Guarantor waives notice of the acceptance of this Guaranty, presentment
to or demand for payment or other performance by the Company or any other
person, notice of nonpayment or failure to perform on the part of the Company,
and all other notices to which Guarantor might otherwise be entitled to in
connection with the Guaranty or any Obligation including, without limitation,
notice of sale of any collateral security therefore. The obligations of
Guarantor hereunder shall be absolute, continuing and unconditional. Each
Investor shall be at liberty, without giving any notice to or obtaining the
assent of Guarantor and without relieving Guarantor of any liability hereunder
or prejudicing, impairing or otherwise affecting any of the Investors' rights
hereunder, to deal with the Company and with each other person who now is or
hereafter becomes liable for any Obligation, in such manner as any such
Investor in their sole discretion deems fit, and to this end Guarantor give
each Investor full authority to do any and all
<PAGE> 92
of the following things from time to time: (a) vary the terms (excluding (i) an
increase of the aggregate principal amount due under the Notes in excess of
$1,000,000 or (ii) an increase of the applicable interest rate provided for
under the Notes on the applicable date of issuance) and grant extensions or
renewals of any present or future indebtedness of the Company or any such other
person, (b) grant time, waivers and other indulgences in respect thereto, (c)
vary, exchange, surrender, forfeit, release or discharge, wholly or partially,
or delay in or abstain from perfecting and enforcing, any collateral security or
guaranty or other means of obtaining payment of any Obligation, (d) accept
partial payments from the Company or any such other person, (e) release or
discharge, wholly or partially, any endorser or guarantor, and (f) compromise or
make any settlement or other arrangement with the Company or with any other
person primarily or secondarily liable with the Company. NOTWITHSTANDING THE
FOREGOING, UPON THE FULL SATISFACTION, CANCELLATION OR CONVERSION OF ALL OF THE
NOTES, GUARANTOR'S OBLIGATIONS UNDER THIS GUARANTY SHALL AUTOMATICALLY TERMINATE
IN THEIR ENTIRETY WITHOUT FURTHER ACTION OF OR NOTICE GIVEN BY GUARANTOR AND
WITHOUT FURTHER RECOURSE BY THE HOLDERS OF THE NOTES, EXCEPT AS PROVIDED BY
SECTION 5, IF APPLICABLE.
3. No right, power or remedy herein conferred upon or reserved to the
Investors is intended to be exclusive of any other right, power or remedy or
remedies and each and every right, power and remedy of the Investors pursuant
to this Guaranty now or hereafter existing at law or in equity or by statute
or otherwise shall, to the extent permitted by law, be cumulative and
concurrent and shall be in addition to each other right, power or remedy
pursuant to this Guaranty, and the exercise by the Investors of any one or more
such rights, powers or remedies shall not preclude the simultaneous or later
exercise by the Investors of any or all such other rights, powers or remedies.
4. No failure or delay by any Investor to insist upon the strict
performance of any term, condition, covenant or agreement of this Guaranty or
to exercise any right, power or remedy hereunder or consequent upon a breach
hereof shall constitute a waiver of any such term, condition, covenant,
agreement, right, power or remedy of any such breach by any other Investor, or
preclude such Investor or any other Investor from exercising any such right,
power or remedy at any later time or times.
5. Guarantor shall reimburse the Investors on demand, for all expenses
incurred by the Investors in the enforcement of any of its rights hereunder
against Guarantor, including accountable out-of-pocket expenses and reasonable
attorney's fees.
6. In case any one or more of the provisions contained in the Guaranty
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby.
7. The Guaranty (a) constitutes the entire agreement, and supercedes all
prior agreements and understandings, both written and oral, among, the
Investors and Guarantor with respect to the subject matter hereof, (b) may be
changed, waived, discharged or terminated only
-2-
<PAGE> 93
by an instrument in writing signed by the applicable Investor and Guarantor,
and (c) shall be binding upon Guarantor and its heirs, representatives,
successors and assigns or shall inure to the benefit of, and shall be
enforceable by, the Investors and its respective successors and assigns.
8. Unless otherwise specifically provided herein, all notices,
instructions, requests and other communications required or permitted hereunder
shall be in writing and shall become effective when received or if mailed when
deposited in the United States mail, postage prepaid, registered or certified
mail, return receipt requested. Notices shall be directed to the Investors at
its address set forth in the Agreement and to Guarantor at its address set
forth in the Agreement, or at such other address as such party may from time to
time furnish to the other by notice similarly given.
9. This Guaranty shall be governed by, and construed in accordance with,
the laws of the State of New York.
IN WITNESS HEREOF, the Guarantor has set his hand and seal as of the date
first written above.
--------------------------------
Name of Guarantor
--------------------------------
Guarantor's Signature
--------------------------------
Home Address
--------------------------------
City, State & Zip Code
--------------------------------
Witness and Date
-3-
<PAGE> 94
ANNEX A
SUBSIDIARIES
<PAGE> 95
ANNEX A
SUBSIDIARIES
<TABLE>
<CAPTION>
ENTITY OWNERSHIP BY DYNACS (%)
<S> <C>
Dynacs Technical Services, Inc. 100%
Dynacs Digital Services, Inc. 100%
Dynacs Properties, Inc. 50%
Cerulean FXs, Inc. 80%
Dynacs Digital Studios (India) Pvt. Ltd. 99.992%
Dynacs Engineering (India) Pvt. Ltd. 99%
</TABLE>
* We are also beneficial owners of stock in two foreign entities, PT Dynacs
Digital Studios (Indonesia) and Dynacs Digital Studios Pvt. Ltd. (Singapore).
<PAGE> 1
Exhibit 10.12
SECOND WARRANT AND SENIOR SUBORDINATED CONVERTIBLE NOTE
PURCHASE AGREEMENT
SECOND WARRANT AND SENIOR SUBORDINATED CONVERTIBLE NOTE PURCHASE
AGREEMENT (the "Agreement"), dated as of March 15, 2000, among DYNACS INC., a
Delaware corporation (the "Company"), and each person who executes a counterpart
signature page to this Agreement and is listed as an investor on Schedule I
attached to this Agreement (individually, an "Investor" and collectively, with
the other investors in the Offering (as that term is defined below) as the
context may require, the "Investors"). Certain capitalized terms used in this
Agreement are defined in Section 8.16 hereof.
W I T N E S S E T H:
WHEREAS, the Company desires to sell and issue to the Investors, and
the Investors desire to purchase from the Company, up to an aggregate principal
amount of $1,900,000 of the Company's Second Senior Subordinated Convertible
Promissory Notes, each substantially in the form of Exhibit A attached hereto
(collectively, the "Notes"), and Warrants in the form of Exhibit B attached
hereto (individually, a "Warrant" and collectively, the "Warrants") to purchase
shares ("Warrant Shares") of common stock of the Company, par value $.01 per
share (the "Common Stock"), on the terms and conditions set forth herein; and
WHEREAS, the Notes and the Warrants (together, the "Securities") are
being sold to the Investors in connection with the Company's private placement,
commencing February 8, 2000 (the "Offering"), of securities, consisting of the
Notes and the Warrants; and
WHEREAS, the Notes are convertible into Note Shares upon the occurrence
of a Liquidity Event, subject to certain limitations, at the Conversion Price,
or convertible into, or
<PAGE> 2
exchangeable for, Mezzanine Securities, at the election of each holder of a Note
if the Company consummates a Mezzanine Financing after the date of the first
issuance of any Notes; and
WHEREAS, the Warrants are exercisable for Warrant Shares at the
exercise price and on the other terms and conditions set forth in the Warrants;
and
WHEREAS, the Investors, as Registered Holders, have certain
registration rights pertaining to the Note Shares and the Warrant Shares
pursuant to the terms set forth herein and in the Notes and Warrants,
respectively;
NOW, THEREFORE, in consideration of the foregoing premises and the
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
ARTICLE I.
PURCHASE AND SALE OF NOTES AND WARRANTS
Section 1.1 Purchase and Sale of Notes and Warrants. Upon the following
terms and conditions, the Company shall issue and sell to each Investor
severally, and not jointly, and each Investor severally, and not jointly, shall
purchase from the Company, the principal amount of Notes and Warrants for the
number of Warrant Shares, respectively, indicated next to such Investor's name
on Schedule I attached hereto.
Section 1.2 Purchase Price. The Notes shall be offered in $100,000
denominations (the "Purchase Price"), or fractions thereof at the option of the
Company. Each Investor shall also receive Warrants to purchase 15,000 shares of
Common Stock for each $100,000 in principal amount of Notes purchased by such
Investor.
Section 1.3 Closings. (a) The initial closing of the purchase and sale
of the Notes and the Warrants (the "Initial Closing") shall take place at the
offices of Frankfurt Garbus Klein &
2
<PAGE> 3
Selz, at 10:00 a.m., local time, or at such other time and location as may be
agreed upon by the Company and the Investors following acceptance by the Company
of one or more subscriptions for any Notes and Warrants on the later of the
following: (i) the date on which the last to be fulfilled or waived of the
conditions set forth in Article V hereof and applicable to the Closing Date is
fulfilled or waived in accordance herewith and (ii) such other time and place
and/or on such other date as the Investors and the Company may agree. Subsequent
Closings, if any, shall be held at such times as are agreed upon by the Company
and the Investors. The dates on which the Initial Closing and any subsequent
Closing occurs are each referred to herein as a "Closing Date."
(b) On each Closing Date, the Company shall either (i) deliver to each
Investor or H.C. Wainwright & Co., Inc. ("Wainwright") on such Investor's behalf
a Note in the original principal amount set forth opposite such Investor's name
on Schedule I hereto, and a Warrant to purchase the number of Warrant Shares
registered in the name of such Investor or its nominee as is set forth opposite
such Investor's name on Schedule I hereto, or (ii) deposit such Note and Warrant
into accounts designated by such Investor or Wainwright on such Investor's
behalf, and such Investor shall deliver to the Company the Purchase Price for
the principal amount of the Note purchased by such Investor hereunder by wire
transfer in immediately available funds to the escrow account maintained by
Escrow Agent for the Company and Wainwright. In addition, each party shall
deliver all documents, instruments and writings required to be delivered by such
party pursuant to this Agreement at or prior to such Closing Date.
3
<PAGE> 4
ARTICLE II.
REPRESENTATIONS AND WARRANTIES
Section 2.1 Representations and Warranties of the Company. The Company
hereby makes the following representations and warranties to each of the
Investors as of the date hereof and as of the Closing Date on which such
Investor purchases its Securities.
(a) Organization and Qualification; Material Adverse Effect. Each of
the Company and its Subsidiaries is a corporation duly incorporated and existing
in good standing under the laws of its respective jurisdiction of incorporation
and each of the Company and its Subsidiaries has the requisite corporate power
to own its properties and to carry on its business as now being conducted. As
indicated on Annex A attached hereto, the Company owns the percentage indicated
thereon of the outstanding capital stock of each Subsidiary. The Company does
not have any direct or indirect subsidiaries other than the Subsidiaries and
those entities listed on Annex B hereto. Each of the Company and the
Subsidiaries is duly qualified as a foreign corporation to do business and is in
good standing in every jurisdiction in which the nature of the business
conducted or property owned by it makes such qualification necessary, other than
those jurisdictions in which the failure so to qualify would not have a Material
Adverse Effect.
(b) Authorization; Enforcement. (i) The Company has the requisite
corporate power and authority to enter into and perform this Agreement and to
issue the Notes and the Warrants in accordance with the terms hereof, (ii) the
execution and delivery of this Agreement by the Company and the consummation by
it of the transactions contemplated hereby, including the issuance of the Notes
and the Warrants, have been duly authorized by all necessary corporate action,
and no further consent or authorization of the Company or its Board of Directors
or stockholders is required therefor, (iii) this Agreement has been duly
executed and delivered by
4
<PAGE> 5
the Company, and (iv) this Agreement constitutes the valid and binding
obligation of the Company enforceable against the Company in accordance with its
terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, liquidation or similar laws relating to,
or affecting generally, the enforcement of creditors' rights and remedies or by
other equitable principles of general application.
(c) Capitalization. The authorized capital stock of the Company
consists of 20,000,000 shares of Common Stock and 5,000,000 shares of preferred
stock; without giving effect to the Offering or the Prior Offering, there are
4,768,750 shares of Common Stock and no shares of preferred stock issued and
outstanding. All of the outstanding shares of Common Stock have been validly
issued and are fully paid and non-assessable. There are no preemptive rights
with respect to shares of Common Stock other than the rights of holders of
record of shares of common stock of the Company's subsidiary, Cerulean FXs, Inc.
("Cerulean"), as set forth in Section 6 of that certain Exchange Agreement,
dated as of August 13, 1999, by and among the Company, Ramendra P. Singh,
Michael Burns, William Dallas, Jon Feltheimer and Offensive Group Associates,
LP. Without giving effect to the Offering or the Prior Offering (or the rights
of holders of the securities issued in connection therewith) or the obligation
of the Company to issue certain securities to Wainwright, but assuming the
exercise of other options and warrants or other rights currently outstanding to
acquire shares of Common Stock and the exchange or conversion of any other
currently outstanding securities of the Company that are convertible into or
exchangeable for, shares of Common Stock, there would be 5,778,500 shares of
Common Stock outstanding. Without giving effect to the Offering or the Prior
Offering (or the rights of holders of the securities issued in connection
therewith) or the Company's obligation to issue certain securities to
Wainwright, there are outstanding options for 385,000 shares of Common
5
<PAGE> 6
Stock, and in addition, the holders of 20% of the issued and outstanding shares
of Cerulean have the right to convert such Cerulean shares into 624,750 shares
of the Company's Common Stock, subject to adjustment, and the Company has agreed
to issue to Wainwright certain warrants to purchase shares of Common Stock and
other securities of the Company under certain conditions in connection with the
consummation of each of the Offering, the Prior Offering, any Mezzanine
Financing, and an initial public offering, if any, of Common Stock. Except as
indicated in this paragraph (c) or contemplated by this Agreement or disclosed
in the Documents, there are no other scrip, rights to subscribe for, calls or
commitments of any character whatsoever relating to, or securities or rights
exchangeable or convertible into, any shares of capital stock of the Company, or
contracts, commitments, understandings or arrangements by which the Company is
or may become bound to issue additional shares of capital stock of the Company
or options, warrants, scrip, rights to subscribe for, or commitments to purchase
or acquire, any shares, or securities or rights convertible into shares, of
capital stock of the Company.
(d) Issuance of Common Shares. The Note Shares issuable upon conversion
of the Notes and the Warrant Shares issuable upon exercise of the Warrants are
duly authorized and will be, as of the applicable Closing Date, reserved for
issuance and, upon their issuance and such conversion in accordance with the
terms of the Notes or such exercise in accordance with the terms of the
Warrants, as the case may be, such Note Shares and Warrant Shares will be
validly issued, fully paid and non-assessable, free and clear of any and all
liens, claims and encumbrances, and the holders of such Note Shares and Warrant
Shares, as the case may be, shall be entitled to all rights and preferences
accorded to a holder of Common Stock.
(e) No Conflicts. The execution, delivery and performance of this
Agreement by the Company and the consummation by the Company of the transactions
contemplated hereby and
6
<PAGE> 7
thereby do not and will not (i) result in a violation of the charter or bylaws
of the Company or any of the Subsidiaries or (ii) conflict with, or constitute a
default (or an event which with notice or lapse of time or both would become a
default) under, or give to others any rights of termination, amendment,
acceleration or cancellation of, any agreement, indenture, patent, patent
license or instrument to which the Company or any of the Subsidiaries is a
party, or result in a violation of any federal, state, local or foreign law,
rule, regulation, order, judgment or decree (including Federal and state
securities laws and regulations) applicable to the Company or any of the
Subsidiaries or by which any property or asset of the Company or any of the
Subsidiaries is bound or affected (except for such conflicts, defaults,
terminations, amendments, accelerations, cancellations and violations as would
not, individually or in the aggregate, have a Material Adverse Effect); provided
that: (A) for purposes of such representation as to Federal, state, local or
foreign law, rule or regulation, no representation is made herein with respect
to any of the same applicable solely to any of the Investors and not to the
Company or any of the Subsidiaries; and (B) the foregoing representation with
respect to any foreign law, rule or regulation is made herein to the best of the
Company's knowledge. Neither the business of the Company nor that of any of the
Subsidiaries is being conducted in violation of any law, ordinance or regulation
of any governmental entity, except for violations which either singly or in the
aggregate do not and will not have a Material Adverse Effect. The Company is not
required under Federal, state or local law, rule or regulation nor, to the best
of its knowledge, any foreign law, rule or regulation to obtain any consent,
authorization or order of, or to make any filing or registration with, any court
or governmental agency in order for it to execute, deliver or perform any of its
obligations under this Agreement or issue and sell the Notes or the Warrants in
accordance with the terms hereof and issue the Note Shares upon conversion of
the Notes or the Warrant Shares upon exercise of
7
<PAGE> 8
the Warrants, except with respect to the registration provisions provided for
herein and "Blue Sky" filings with various states, provided that, for purposes
of the representation made in this sentence, the Company is assuming and relying
upon the accuracy of the relevant representations and agreements of each of the
Investors herein and the information contained in their respective Investor
Questionnaires.
(f) Documents; Financial Statements. The Company has delivered or made
available to the Investors itself or through Wainwright true and complete copies
of the Offering Memorandum (as amended or supplemented) and each of the other
Documents.
(g) No Material Adverse Change. Since September 30, 1999, no event
which had or is likely to have a Material Adverse Effect has occurred or exists
with respect to the Company or any of the Subsidiaries, except the costs and
expenses of the Arbitration Proceedings and except as otherwise disclosed or
reflected in the Documents. Notwithstanding the foregoing, the financial summary
included in the Documents compiled from the unaudited financial statements of
the Company and its Subsidiaries for the fiscal year ended September 30, 1999
reflect a combined loss of $124,169 and, accordingly, as of September 30, 1999,
the Company had a working capital deficit of $2,241,040.
(h) No Undisclosed Liabilities. Neither the Company nor any of its
Subsidiaries has any liabilities or obligations not disclosed in the Documents,
other than those liabilities incurred in the ordinary course of its respective
business since September 30, 1999, liabilities with respect to the ongoing
Arbitration Proceedings, liabilities or obligations, which, individually or in
the aggregate, do not or would not have a Material Adverse Effect on the Company
and the Subsidiaries, taken as a whole, and liabilities incurred in connection
with the sale of $1,000,000
8
<PAGE> 9
in principal amount of Senior Subordinated Convertible Notes in connection with
the Prior Offering.
(i) No General Solicitation. None of the Company, any of the
Subsidiaries nor, to the Company's knowledge, any of their respective Affiliates
or anyone acting on its or their behalf has engaged in any form of general
solicitation or general advertising (within the meaning of Regulation D
promulgated under the Securities Act) in connection with the Offering.
(j) No Integrated Offering. None of the Company, any of the
Subsidiaries, or, to the Company's knowledge, any of their respective
Affiliates, or anyone acting on its or, to the best of the Company's knowledge,
their behalf has, directly or indirectly, made any offers or sales of any
security or solicited any offers to buy any security, under circumstances that
would require registration of the Notes or the Warrants.
(k) Intellectual Property. Each of the Company and the Subsidiaries
owns or has licenses to use certain patents, copyrights and trademarks
("intellectual property") associated with its respective business. Each of the
Company and the Subsidiaries has all intellectual property rights which the
Company reasonably believes are needed to conduct its business as it is now
being conducted. The Company has no reason to believe that the intellectual
property rights owned by the Company or any of the Subsidiaries are invalid or
unenforceable or that the use of such intellectual property by the Company or
any of the Subsidiaries infringes upon or conflicts with any right of any third
party, and neither the Company nor any of the Subsidiaries has received notice
of any such infringement or conflict. Except in connection with the Arbitration
Proceedings and infringement notices sent on behalf of Cerulean or its
predecessor between 1996 and 1998, and the intellectual property which is the
subject matter thereof, the Company has no
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knowledge of any infringement by any third party of the intellectual property
rights of the Company or any of the Subsidiaries.
(l) No Litigation. Except with respect to the Arbitration Proceedings
or as set forth in the Documents, no litigation or claim (including those for
unpaid taxes) against the Company or any of the Subsidiaries is pending or, to
the Company's knowledge, threatened, and no other event has occurred, which, if
determined adversely, would have a Material Adverse Effect on the Company and
the Subsidiaries, taken as a whole, or would materially adversely effect the
transactions contemplated hereby.
(m) Brokers. The Company has taken no action which would give rise to
any claim by any person, other than Wainwright, for brokerage commissions,
finder's fees or similar payments by any Investor relating to this Agreement or
the transactions contemplated hereby.
(n) Unsecured Obligations; Subordination. The Notes and the amounts
payable thereunder, including principal and accrued interest, are unsecured
obligations of the Company, and shall be subordinate and junior to indebtedness
incurred by the Company pursuant to: (i) currently existing equipment
financings; (ii) currently existing debt of $585,000 secured by certain revenues
pursuant to a Loan Agreement dated May 10, 1999; and (iii) up to an aggregate of
$6,000,000 of indebtedness of the Company currently existing or hereinafter
incurred by the Company under a working capital facility with First National
Bank of Florida, or the renewal, modification, refinancing or replacement
thereof with a financial institution, bank or commercial lender. Except as set
forth in the preceding sentence, the Notes shall not be subordinate or junior to
any other indebtedness of the Company.
Section 2.2 Representations and Warranties of the Investors. Each of
the Investors, severally, and not jointly, hereby makes the following
representations and warranties to the
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Company and each of the Subsidiaries as of the date hereof and on the Closing
Date applicable to such Investor.
(a) Authorization; Enforcement. (i) Such Investor has the requisite
power and authority to enter into and perform this Agreement and to purchase the
Notes and the Warrants being sold to it hereunder, (ii) the execution and
delivery of this Agreement by such Investor and the consummation by it of the
transactions contemplated hereby and thereby have been duly authorized by all
necessary corporate, company or partnership action, as required, and (iii) this
Agreement constitutes the valid and binding obligation of such Investor
enforceable against such Investor in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation or similar laws relating to, or
affecting generally the enforcement of creditors' rights and remedies or by
other equitable principles of general application.
(b) No Conflicts. The execution, delivery and performance of this
Agreement and the consummation by such Investor of the transactions contemplated
hereby do not and will not (i) result in a violation of such Investor's
organizational documents, or (ii) conflict with any agreement, indenture, or
instrument to which such Investor is a party, or (iii) result in a violation of
any law, rule, or regulation or any order, judgment or decree of any court or
governmental agency applicable to such Investor. Such Investor is not required
to obtain any consent or authorization of any governmental agency in order for
it to perform its obligations under this Agreement.
(c) Investment Representation. Such Investor is purchasing the Notes
and the Warrants for its own account and not with a view to the resale or
distribution thereof or any part thereof. Such Investor has no present intention
to sell the Notes or the Warrants and such
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Investor has no present intention to sell, transfer, assign, pledge or otherwise
hypothecate any of the Securities or any rights therein to or through any Person
in violation of any securities laws. The Company acknowledges that the Investors
have the rights to (i) convert their Notes into Note Shares, (ii) exercise the
Warrants for shares of Common Stock, and (iii) demand registration of their
Registrable Securities or participate in a registration of equity securities of
the Company on a piggyback basis, all as set forth herein and in the Notes and
the Warrants, and nothing contained in this paragraph (c) is intended to
restrict the Investors in the exercise of any such rights.
(d) Limitations on Transferability; Rule 144; Lock-Up Agreements. Such
Investor understands that: (i) there is no public trading market for the Notes,
the Warrants, the Note Shares, the Warrant Shares or the Mezzanine Securities
and that no such trading market is expected to develop; (ii) the Notes must be
held until repaid in full unless the Notes are (A) converted pursuant to their
terms or (B) registered under the Securities Act or an exemption from such
registration is available and the Company receives an opinion of counsel,
acceptable to the Company in its sole discretion, that such exemption is
available for such Investor's proposed disposition; (iii) the Warrants must be
held indefinitely unless (A) the Warrants are exercised in accordance with the
terms thereof or they are registered under the Securities Act and applicable
state securities law or (B) an exemption from such registration is available and
the Company receives an opinion of counsel, acceptable to the Company in its
sole discretion, that such exemption is available for such Investor's proposed
disposition; (iv) the Warrant Shares and the Note Shares must be held
indefinitely unless (A) such Warrant Shares or the Note Shares, as the case may
be, are registered under the Securities Act or (B) an exemption from such
registration is available and the Company receives an opinion of counsel,
acceptable to the Company in its sole
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discretion, that such exemption is available for such Investor's proposed
disposition; and (v) the Securities and the Registrable Securities will be
subject to (A) a lock-up agreement to be signed by such Investor imposing
restrictions on the transfer or other disposition of such securities for a
period of 180 days following the effective date of the registration statement,
if any, filed by the Company in connection with an initial public offering of
securities of the Company or such longer period as the NASD may require and (B)
such other restrictions on transfer as the NASD may require in connection with
such initial public offering (each such agreement or requirement, a "Lock-Up
Agreement"). Such Investor agrees not to transfer or otherwise dispose of the
Securities or the Registrable Securities, directly or indirectly, except (1) in
compliance with the terms of this Agreement, the Securities Act and applicable
state securities laws, (2) as to securities subject to any Lock-Up Agreement,
with the prior written consent of Wainwright or if the transfer or other
disposition is made to any Affiliate of such Investor, as a bona fide gift or to
any trust. Such Investor has also been advised or is aware of the provisions of
Rule 144 promulgated under the Securities Act restricting the transfer of
securities under certain circumstances; and such Investor understands and agrees
that each Note, Warrant and certificate representing Note Shares or Warrant
Shares shall bear a legend substantially in the form of the legend set forth in
Article VI hereof.
(e) Accredited Investor. Such Investor is an "accredited investor," as
defined in Rule 501 promulgated under the Securities Act, on the basis set forth
in such Investor's Investor Questionnaire. Such Investor knows that an
investment in the Securities is illiquid and involves a high degree of risk,
including, without limitation, (i) the potential loss of such Investor's entire
investment and (ii) the risks set forth in the Offering Memorandum. Such
Investor has such knowledge and experience in financial and business matters in
general and investments in
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<PAGE> 14
particular, that such Investor is able to evaluate the merits and risks of an
investment in the Securities and to protect its own interests in connection with
such investment. Such Investor has been afforded the opportunity to ask
questions of the Company and its authorized representatives and request
information regarding the Company and/or its subsidiaries and their business
operations and all other information which such Investor deems necessary or
appropriate in deciding whether to invest in the Securities pursuant hereto, and
such Investor has received satisfactory responses to such questions and all such
information requested from the Company. Such Investor understands that an
investment in the Securities involves a high degree of risk and is capable of
sustaining the loss of such Investor's entire investment in the Securities.
(f) Brokers. Such Investor has taken no action which would give rise to
any claim by any Person for brokerage commissions, finder's fees or similar
payments by the Company relating to this Agreement or the transactions
contemplated hereby.
(g) Confidentiality. Such Investor understands that breach of the
covenant contained in Section 3.2 hereof relating to confidentiality and
non-disclosure of certain non-public information could result in a violation by
such Investor and the Company of federal securities laws and that the Company is
relying upon such covenant to avert a breach of such laws.
(h) Reliance by the Company. Such Investor understands that the Notes
and the Warrants are being offered and sold in reliance on a transactional
exemption from the registration requirements of Federal and state securities
laws and that the Company is relying upon the truth and accuracy of the
representations, warranties, agreements, acknowledgments and understandings of
such Investor set forth herein and in such Investor's Investor Questionnaire in
order to determine the applicability of such exemption and the suitability of
such Investor to acquire the Notes and the Warrants.
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(i) ERISA. No part of the funds used by such Investor to purchase
Securities hereunder constitutes assets of any "employee benefit plan" (as
defined in Section 3(3) of ERISA or "plan" (as defined in Section 4975 of the
Internal Revenue Code of 1986, as amended, or any successor statute thereto).
(j) NASD Affiliation. All information provided by such Investor in its
Investor Questionnaire with respect to such Investor's status as an Affiliate of
any member of the NASD, or such Investor's association with any member of the
NASD (including, without limitation, Wainwright and Cruttenden) or any related
person is true, complete and correct.
ARTICLE III.
COVENANTS
Section 3.1 Covenants of the Company.
(a) Certificates on Conversion and Exercise.
(i) Certificates on Conversion. Upon any conversion of the
Notes by an Investor or its Permitted Transferee, as the case may be,
the Company shall issue and deliver to such Investor or its Permitted
Transferee, as the case may be, within a reasonable time following the
Conversion Date, one or more certificates for Note Shares in accordance
with the terms of the Note.
(ii) Certificates upon Exercise. Upon any exercise of a
Warrant by an Investor or its Permitted Transferee, the Company shall
issue and deliver to such Investor or Permitted Transferee, as the case
may be, as soon as practicable after each such exercise, a certificate
or certificates for the Warrant Shares issuable upon such exercise,
registered in the name of such Investor or Permitted Transferee, as the
case may be. If any Warrant should be exercised in part only, the
Company shall, upon surrender of such Warrant for
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<PAGE> 16
cancellation, execute and deliver a new Warrant evidencing the right of
an Investor or its Permitted Transferee, as the case may be, to
purchase the Warrant Shares (or portions thereof) as to which the
Warrant may be but has not been exercised.
(b) Replacement Certificates. Any Note held by any Investor or
Permitted Transferee, upon its reasonable request, may be exchanged by such
Investor or Permitted Transferee, respectively, at any time and from time to
time for a replacement Note or Notes with different principal amounts,
representing, in the aggregate, the same principal amount as that of the Note
being replaced, upon the surrender thereof. Any warrant certificate representing
a Warrant held by any Investor or Permitted Transferee may be exchanged by such
Investor or Permitted Transferee at any time and from time to time for warrant
certificates exercisable for the aggregate number of Warrant Shares to which
such Registered Holder of such warrant certificate is entitled, as reasonably
requested by such Registered Holder upon surrendering the same. No service
charge will be payable for such registration, transfer or exchange.
(c) Securities Compliance. The Company shall take all necessary action
as may be required and permitted by applicable law, rule and regulation for the
legal and valid issuance of the Notes and the Warrants hereunder and the Note
Shares issuable upon conversion of the Notes and the Warrant Shares issuable
upon exercise of the Warrants.
(d) Notices. The Company agrees to provide all Registered Holders of
Notes and/or Note Shares and Warrants and/or Warrant Shares with copies of all
notices and information, including, without limitation, notices and proxy
statements in connection with any stockholder meetings, that are provided to the
holders of shares of Common Stock, contemporaneously with the delivery of such
notices or information to such Common Stockholders; provided, however, that
anything contained herein to the contrary notwithstanding, the Company shall not
be
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obligated to provide any notices or information to any Registered Holders that
are not stockholders of the Company if the Company reasonably believes that to
do so would violate any law, rule or regulation to which the Company or any of
its subsidiaries is or may be subject or by which any of them is or may be
bound.
(e) Reservation of Stock Issuable Upon Conversion or Exercise. The
Company shall at all times reserve and keep available out of its authorized but
unissued Common Stock, solely for the purpose of effecting the conversion of the
Notes and the exercise of the Warrants, such number of shares of its Common
Stock as shall from time to time be sufficient to effect the conversion of all
outstanding Notes and the exercise of all outstanding Warrants, and if, at any
time, the number of authorized but unissued shares of Common Stock is not
sufficient to effect such conversion and such exercise, the Company shall take
such corporate action as may, in the opinion of its counsel, be necessary to
increase the number of its authorized but unissued shares of Common Stock to
such number of shares as will be sufficient for such purpose, including, without
limitation, engaging in commercially reasonable efforts to obtain the requisite
stockholder approval.
(f) Financial Statements and Reports. The Company shall provide to each
Investor or its Permitted Transferee, until the earlier of (i) the discharge in
full, through repayment or conversion, of all Notes held by such Investor or
Permitted Transferee and the exercise of all Warrants held by such Investor or
Permitted Transferee and (ii) the Company becomes subject to the reporting
requirements of the Exchange act, copies of all quarterly and audited annual
financial statements prepared by or on behalf of the Company, other reports
prepared by or on behalf of the Company for public disclosure and all documents
delivered to all stockholders of the Company; provided, however, that anything
contained herein to the contrary notwithstanding,
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the Company shall not be obligated to provide any documents to any Registered
Holders that are not stockholders of the Company if the Company reasonably
believes that to do so would violate any law, rule or regulation to which the
Company or any of its subsidiaries is or may be subject to by which any of them
is or may be bound.
(g) Use of Proceeds. The Company shall use the net proceeds of the
Offering for working capital. The Company shall not use any of the net proceeds
to repay any unsecured indebtedness for borrowed money of the Company.
3.2 Covenants of Investors and Permitted Transferees.
(a) Confidentiality. Each Investor acknowledges and agrees that (i)
such Investor has received certain information concerning the Company and its
Affiliates, and their business and financial plans which has not been disclosed
publicly ("Confidential Information") in connection with the Offering and (ii)
may receive additional Confidential Information from the Company pursuant to the
Company's obligations under this Agreement. Each Investor agrees that, except as
otherwise expressly provided in this Agreement, such Investor shall not disclose
or permit the disclosure of any Confidential Information to any party or parties
other than its officers, directors and employees and professional advisers, and
then only after each such party has agreed to abide by the terms of this
paragraph (a). The non-disclosure obligations set forth in this paragraph (a)
shall not apply to Confidential Information which: (A) is already known to such
Investor from sources other than the Company, any of its subsidiaries,
Wainwright or Cruttenden or any of their respective officers, directors,
employees, partners, stockholders, agents, representatives, advisers or
Affiliates; (B) becomes generally available to the public other than as a result
of a disclosure by such Investor or any of its officers, employees, directors,
employees partners, stockholders,
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agents, representatives, advisers or Affiliates; or (C) is disclosed in
compliance with the requirements of any law or regulatory or judicial process.
(b) Lock-Up Agreements. Each Investor hereby agrees to execute and
deliver a Lock-Up Agreement providing that such Investor agrees not to transfer
or otherwise dispose of the Securities or the Registrable Securities, directly
or indirectly, (i) for a period of 180 days following the effective date of the
registration statement, if any, filed by the Company in connection with an
initial public offering of securities of the Company, or (ii) on such other
terms and conditions as may be required of any stockholders of the Company by
the NASD in connection with such offering.
ARTICLE IV.
REGISTRATION
Section 4.1 Piggyback Registration. If, at any time during the
five-year period commencing six (6) months after the Company initially becomes
subject to the reporting requirements of Section 13 or Section 15(g) under the
Exchange Act (the "Registration Period"), the Company proposes to register any
of its securities under the Securities Act (other than in connection with (a)
the Company's initial public offering, (b) a transaction contemplated by Rule
145(a) promulgated under the Securities Act or any successor regulation or (c)
pursuant to Form S-8 or S-4 (or their respective successor forms)), the Company
shall give written notice of the Company's intention to do so by registered or
certified mail, at least thirty (30) days prior to the filing of each such
registration statement, to the Registered Holders of the Registrable Securities
(each such Notice, a "Registration Notice"). Upon the written request by a
Registered Holder given within ten (10) days after receipt of a Registration
Notice, that any of such Holder's Registrable Securities be included in such
proposed registration statement (a "Registration
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Request"), the Company shall afford such Registered Holder the opportunity to
have such Registrable Securities registered under such registration statement.
(i) Notwithstanding the provisions of this Section 4.1, the
Company shall have the right at any time after giving a Registration
Notice pursuant to this Section 4.1 to the Registered Holders
(irrespective of whether a Registration Request shall have been made
with respect to any Registrable Securities) to elect not to file any
such proposed registration statement, or to withdraw the same after the
filing but prior to the effective date thereof.
(ii) If any registration pursuant to this Section 4.1 is
underwritten in whole or in part, the Company may require that the
Registrable Securities subject to a Registration Request received from
a Registered Holder be included in the underwriting on the same terms
and conditions as the securities otherwise being underwritten, and then
only in such quantity as, together with all other Registrable
Securities subject to any such Registration Request, will not, in the
opinion of the Managing Underwriter, jeopardize the success of the
underwritten public offering by the Company. In the case of (a) a
primary registration statement on behalf of the Company or (b) a
secondary registration statement on behalf of holders of securities of
the Company exercising a right to request or demand registration, if,
in the opinion of the Managing Underwriter, the registration of the
number of Registrable Securities subject to Registration Requests would
adversely affect such public offering, then the Company shall be
required to include in the underwriting only that number of Registrable
Securities, in addition to all other securities to be sold by the
Company or any other stockholders of the Company, which the Managing
Underwriter believes may be sold without causing such adverse effect.
The Registrable Securities to
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be so included in a registered offering shall be included in such
registration in the following order of priority: First, the securities
which the Company proposes to sell, in a primary offering or the
securities requested to be included therein by securityholders
exercising rights to demand registration or any unfulfilled automatic
rights to registration in the case of a secondary registration; and,
second, shares as to which there are piggyback registration rights. If
less than all shares in either group are to be registered by reason of
the Managing Underwriter's cutback, the shares within a group shall be
allowed to participate in such underwriting on a pro rata basis based
upon the number of securities requested to be included by each
participating stockholder, but in the case of any Registered Holders
pursuant to their respective Registration Requests.
Section 4.2 Demand Registration.
(a) At any time during the Registration Period, the Majority
Holders shall have the right (which right is in addition to the registration
rights under Section 4.1 hereof), exercisable by written notice to the Company
(each such notice, a "Demand Registration Notice"), to require the Company to
prepare and file with the Commission, on one (1) occasion only, a registration
statement and such other documents, including a prospectus, as may be necessary,
in the opinion of counsel for the Company, counsel for the underwriters, if any,
and counsel, if any, for the Majority Holders, to comply with the provisions of
the Securities Act so as to permit a public offering and sale of their
respective Registrable Securities for the period specified hereinbelow by such
Majority Holders and any other Registered Holders of Registrable Securities who
give written notice to the Company (a "Demand Registration Response") within ten
(10) days after receiving notice from the Company of such demand (each such
notice, a "Registration Notice"), provided that the Company is subject to the
reporting requirements of the
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Exchange Act at the time the Company receives the Demand Registration Notice and
the Demand Registration Response. Within ten (10) days after the Company's
receipt of such Demand Registration Notice, the Company shall give a
Registration Notice to all other Registered Holders of Registrable Securities of
such Demand Registration Notice. Anything contained herein to the contrary
notwithstanding, the Majority Holders shall not have the right to demand
registration as provided in this Section 4.2 if, within the preceding six-month
period, the Registered Holders had the opportunity, whether or not exercised, to
register their Registrable Securities pursuant to Section 4.1 hereof.
(b) The Company covenants and agrees to give a Registration Notice with
respect to its receipt of any Demand Registration Notice from any Registered
Holder under this Section 4.2 to all other Registered Holders of the Notes
and/or Note Shares, Warrants and Warrant Shares within ten (10) days of the
receipt of any such Demand Registration Notice.
(c) Each Investor acknowledges and agrees that the right to demand
registration of Registrable Securities set forth in this Section 4.2 shall not
be in addition to any rights of such Investor to demand registration pursuant to
the terms of any Note and/or Warrant issued to such Investor.
Section 4.3 Covenants of the Company With Respect to Registration. The
Company covenants and agrees as follows:
(a) to use commercially reasonable efforts to file a registration
statement within forty-five (45) days of the Company's receipt of a Registration
Request or a Demand Registration Notice, which request or demand triggers the
Company's obligation to register securities of any Registered Holders pursuant
to Section 4.1 or 4.2 hereof, respectively, and to cause such registration
statement to be declared effective at the earliest possible time;
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(b) to pay all costs (excluding transfer taxes, if any, and any
underwriting or selling commissions), fees and expenses in connection with all
registration statements filed pursuant to Section 4.1 or 4.2 hereof including,
without limitation, the Company's legal and accounting fees, printing expenses
and blue sky fees and expenses;
(c) as expeditiously as possible, to prepare and file with the
Commission any amendments and supplements to the registration statement and the
prospectus included in the registration statement as may be necessary to keep
the registration statement effective, in the case of a firm commitment
underwritten public offering, until each underwriter has completed the
distribution of all securities purchased by it and, in the case of any other
offering, until the earlier of the sale of all Registrable Securities covered
thereby or two hundred seventy (270) days after the effective date thereof;
(d) as expeditiously as possible, to furnish to each Seller such
reasonable numbers of copies of the prospectus, including a preliminary
prospectus, in conformity with the requirements of the Securities Act, and such
other documents as such Seller may reasonably request in order to facilitate the
public sale or other disposition of the Registrable Securities owned by such
Seller pursuant to Section 4.1 or 4.2 hereof;
(e) as expeditiously as possible, to use its commercially reasonable
efforts to register or qualify the Registrable Securities covered by the
registration statement under the securities or blue sky laws of such states as
each Seller reasonably requests, and do any and all other acts and things that
may be necessary or desirable to enable each Seller to consummate the public
sale or other disposition in such states of the Registrable Securities owned by
such Seller; provided, however, that the Company shall not be required in
connection with this subsection (e) to qualify as a foreign corporation in any
jurisdiction in which it is not already obligated to qualify or
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execute or file a general consent to service of process in any jurisdiction or
subject itself to the laws of any jurisdiction other than the United States or
any state thereof;
(f) if the registration statement relates to an underwritten offering,
to enter into and perform its obligations under an underwriting agreement in the
usual and customary form, including, without limitation, customary
indemnification and contribution obligations;
(g) to notify each Seller at any time when a prospectus relating to
Registrable Securities covered by the registration statement is effective, of
the happening of any event as a result of which the prospectus included in the
registration statement, as then in effect, includes an untrue statement of a
material fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing. The Company shall use commercially reasonable
efforts promptly to amend or supplement the registration statement to correct
any such untrue statement or omission;
(h) to notify each Seller of the issuance by the Commission or any
state securities commission or similar regulatory body of any stop order
suspending the effectiveness of the registration statement or the initiation of
any proceedings for that purpose. The Company will make every commercially
reasonable effort to prevent the issuance of any stop order and, if any stop
order is issued, to obtain the lifting thereof at the earliest possible time;
(i) if, after the Company shall have delivered preliminary or final
prospectuses to a Seller, the prospectus is amended to comply with the
provisions of the Securities Act or is otherwise amended or supplemented, the
Company shall promptly notify each Seller. In the event of such notification,
the Sellers shall immediately cease making offers of Registrable Securities and,
if requested, shall return all prospectuses to the Company. The Company shall
promptly provide each Seller with revised prospectuses and, following its
receipt of the revised
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prospectuses, each Seller shall be free to resume making offers of the
Registrable Securities, subject only to applicable law and the terms of any stop
order of the Commission or any state securities commission or similar regulatory
body.
(j) permit a single law firm, if any, designated by the Majority
Holders as counsel to the Registered Holders, to review the Registration
Statement and all amendments and supplements thereto within a reasonable period
of time prior to the filing thereof, and shall not file any document in a form
to which such counsel reasonably objects.
(k) the Company shall make available for inspection by the Registered
Holders and any representative of all Registered Holders, any underwriter
participating in any disposition pursuant to a registration statement, and any
attorney or accountant retained by any Registered Holder or underwriter, all
financial and other records customary for purposes of a due diligence
examination of the Company by the Registered Holders or such underwriters, as
the case may be, pertinent corporate documents and properties of the Company,
and cause the Company's officers, directors and employees to supply all
information reasonably requested by any such representative, underwriter,
attorney or accountant in connection with such registration statement, provided
that such parties agree to keep all such records, documents, properties and
information confidential.
(l) In the event that the Company registers any of the Registrable
Securities under the Securities Act, the Company will indemnify and hold
harmless each of the Sellers and each underwriter of the Registrable Securities
so registered (including any broker or dealer through whom such Registrable
Securities may be sold pursuant to the applicable underwriting agreement) and
their respective officers, directors, Affiliates and each Controlling Person, if
any, of such Seller or any such underwriter, from and against (i) any and all
losses, claims, damages,
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expenses or liabilities, joint or several, as incurred, to which they or any of
them becomes subject under the Securities Act, applicable state securities laws
or under any other statute or at common law or otherwise, and (ii) except as
hereinafter provided, will reimburse each such Seller, underwriter and
Controlling Person, if any, for any legal or other expenses such Seller,
underwriter and/or Controlling Person, respectively, reasonably incurred in
connection with investigating or defending any actions whether or not resulting
in any liability, as incurred, but only insofar as such losses, claims, damages,
expenses, liabilities or actions set forth in the preceding clauses (i) and (ii)
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in the registration statement, in any preliminary
or amended preliminary prospectus or in the final prospectus (or the
registration statement or prospectus as from time to time amended or
supplemented by the Company), in any application or other document executed by
the Company or based upon information furnished and filed by the Company in any
jurisdiction in order to qualify the securities under the securities laws
thereof or filed with the Commission, the NASD, the Nasdaq Stock Market or any
securities exchange, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary in order to make the statements therein not misleading, or any
violation by the Company of any rule or regulation promulgated under the
Securities Act or any state securities laws applicable to the Company and
relating to action or inaction required of the Company in connection with such
registration, unless (i) such untrue statement or alleged untrue statement or
omission or alleged omission was made in such registration statement,
preliminary or amended preliminary prospectus or final prospectus or
application, document or filing in reliance upon and in conformity with
information furnished in writing to the Company in connection therewith by a
Seller or any of its Controlling Persons (in the case of
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indemnification of a Seller or such Controlling Person), or any such underwriter
or its Controlling Persons (in the case of indemnification of such underwriter
or its Controlling Persons) expressly for use therein, or unless (ii) in the
case of a sale directly by such Seller (including a sale of such Registrable
Securities through any underwriter retained by such Seller to engage in a
distribution on its behalf), such untrue statement or alleged untrue statement
or omission or alleged omission was contained in a preliminary prospectus and
corrected in a final or amended prospectus copies of which were delivered to
such Seller or such underwriter on a timely basis, and such Seller or
underwriter failed to deliver a copy of the final or amended prospectus at or
prior to the confirmation for the sale of the Registrable Securities to the
Person asserting any such loss, claim, damage or liability in any case where
such delivery is required by the Securities Act.
Promptly after receipt by any Seller, any underwriter or any of their
respective Controlling Persons of notice of the commencement of any action in
respect of which indemnity may be sought against the Company, such Seller,
underwriter or Controlling Person, as the case may be, shall notify the Company
in writing of the commencement thereof (provided, that failure to so notify the
Company shall not relieve the Company from any liability it may have hereunder,
except to the extent that the Company's defense of such action was materially
and adversely affected thereby), and, subject to the provisions hereinafter
stated, the Company shall assume the defense of such action (including the
employment of counsel, who shall be counsel reasonably satisfactory to such
Seller, underwriter or Controlling Person, as the case may be), and shall assume
the payment of expenses insofar as such action relates to any alleged liability
in respect of which indemnity may be sought against the Company hereunder.
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Such Seller, or any such underwriter and their respective Controlling
Persons shall have the right to employ separate counsel in any such action and
to participate in the defense thereof, but the fees and expenses of such counsel
subsequent to any assumption of the defense by the Company shall not be paid by
the Company unless (A) engagement of such counsel has been specifically
authorized in writing by the Company, (B) the Company shall not have engaged
counsel to defend such action by the earlier of (1) 45 days after the Company
shall have received notice of such action and (2) the date by which any filing
must be made with the court or administrative body adjudicating any such action
or any other action must be taken in order not to relinquish any rights
applicable to such Seller or any of its Controlling Persons, or (C) such
indemnified party or parties shall have reasonably concluded that there may be
defenses available to it or them which are different from or additional to those
available to the Company (in which case the Company shall not have the right to
direct the defense of such action on behalf of the indemnified party or
parties), in either such event, the fees and expenses of not more than one
additional firm of attorneys for the Seller(s), such underwriter and/or their
respective Controlling Persons shall be borne by the Company. The Company shall
not be liable to indemnify any Person for any settlement of any such action
effected without the Company's written consent. The Company shall not, except
with the approval of each party being indemnified under this paragraph 4.3(l),
consent to the entry of any judgment or enter into any settlement of any action,
suit or other proceeding which does not include as an unconditional term thereof
the giving by claimants or plaintiffs to the parties being so indemnified of a
release from all liability in respect of all claims made in such action, suit or
proceeding.
In order to provide for just and equitable contribution to joint
liability under the Securities Act in any case in which any Seller or any
Controlling Person of a Seller makes a claim for
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indemnification pursuant to this Section 4.3(l), but it is judicially determined
(by the entry of a final judgment or decree by a court of competent jurisdiction
and the expiration of time to appeal or the denial of the last right of appeal)
that such indemnification may not be enforced in such case notwithstanding the
fact that this Section 4.3(l) provides for indemnification in such case, then,
each of the Company, such Seller and such Controlling Person shall contribute to
the aggregate losses, claims, damages or liabilities to which it may be subject
(after contribution from others) in such proportion as is appropriate to reflect
the relative fault of the Company on the one hand and that of such Seller and
each of its Controlling Persons on the other hand, in connection with the
statements or omissions which resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault of the Company on the one hand and of the Seller and/or its
Controlling Persons on the other hand shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company on the one hand or by such Seller and/or its Controlling
Persons, on the other hand, and the relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission of
each of the Company, on the one hand and the Seller and/or its Controlling
Persons, on the other hand; provided, however, that, in any such case, (A) no
such Seller will be required to contribute any amount in excess of the public
offering price of all Registrable Securities sold by such Seller pursuant to
such registration statement, and (B) no Person or entity guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
will be entitled to contribution from any Person that was not guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act.
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(m) If, at any time, the Company lists its Common Stock on any national
securities exchange and registers the Common Stock under the Exchange Act, the
Company shall, at its expense: (i) include in its application for such listing
the Registrable Securities and maintain such listing of the Common Stock; (ii)
use commercially reasonable efforts to timely file with the Commission such
information as the Commission may require under Section 13 or Section 15(d) of
the Exchange Act; and (iii) provided the Registration Period shall have
commenced, (A) use commercially reasonable efforts to list Registrable
Securities on such national securities exchange simultaneously with the
registration thereof, if any, and (iv) use commercially reasonable efforts to
take all action as may be required as a condition to the availability of Rule
144 or Rule 144A under the Securities Act (or any successor exemptive rule
hereinafter in effect) with respect to such Registrable Securities. If the
Company lists any class of equity securities on any national securities exchange
and registered such class of equity securities under the Exchange Act, the
Company shall furnish to any Seller forthwith upon such Seller's request (x) a
written statement by the Company as to its compliance with the reporting
requirements of Rule 144, (y) a copy of the most recent annual or quarterly
report of the Company as filed with the Commission, and (z) such other reports
and documents as such Seller may reasonably request in availing itself of any
rule or regulation of the Commission allowing such Seller to sell any such
Registrable Securities without registration. The Company agrees to use
commercially reasonable efforts to facilitate and expedite transfers of
Registrable Securities pursuant to Rule 144 under the Securities Act, which
efforts shall include timely notice to its transfer agent to expedite such
transfers of Common Stock.
Section 4.4 Indemnification by Sellers. In the event that the Company
registers any of the Registrable Securities under the Securities Act, each
Seller of Registrable Securities so
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registered shall indemnify and hold harmless the Company, each of its directors
and each of its officers who have signed or otherwise participated in the
preparation of the registration statement, each of the Company's Controlling
Persons, each underwriter of the Registrable Securities so registered (including
any broker or dealer through whom such of the shares may be sold) and each of
such underwriter's Controlling Persons, from and against any and all losses,
claims, damages, expenses or liabilities, joint or several as incurred, to which
they or any of them may become subject under the Securities Act, applicable
state securities laws or under any other statute or at common law or otherwise,
and, except as hereinafter provided, shall reimburse the Company and each such
director, officer, underwriter, broker, dealer or Controlling Person for any
legal or other expenses it reasonably incurs in connection with investigating or
defending any action, suit or proceeding whether or not resulting in any
liability, insofar as such losses, claims, damages, expenses, liabilities or
actions arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the registration statement, in any
preliminary or amended preliminary prospectus or in the final prospectus (or in
the registration statement or prospectus as from time to time amended or
supplemented) or arise out of or are based upon the omission or alleged omission
to state therein a material fact required to be stated therein or necessary in
order to make the statements therein not misleading, but only insofar as any
such statement or omission was made in reliance upon and in conformity with
information furnished in writing to the Company in connection therewith by such
Seller or Controlling Person of the Seller expressly for use therein; provided,
however, that such Seller's obligations to any Person hereunder shall be limited
to an amount equal to the proceeds of the sale of all Registrable Securities
sold by such Seller pursuant to the relevant registration statement or
prospectus.
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<PAGE> 32
Promptly after the Company's receipt of notice of the commencement of
any action, suit or proceedings in respect of which indemnity may be sought
against such Seller, the Company shall notify such Seller in writing of the
commencement thereof (provided, that failure to so notify such Seller shall not
relieve such Seller from any liability it may have hereunder, except to the
extent such Seller's defense of such action was materially adversely affected
thereby), and such Seller shall, subject to the provisions hereinafter stated,
be entitled to assume the defense of such action (including the employment of
counsel, who shall be counsel reasonably satisfactory to the Company) and shall
assume the payment of all expenses insofar as such action, suit or proceedings
relates to the alleged liability in respect of which indemnity may be sought
against such Seller hereunder. The Company and each such director, officer,
underwriter or Controlling Person shall have the right to employ separate
counsel in any such action and to participate in the defense thereof, but the
fees and expenses of such counsel subsequent to any assumption of the defense by
such Seller shall not be at the expense of such Seller unless (A) engagement of
such counsel is specifically authorized in writing by such Seller, (B) such
Seller shall not have employed counsel to defend such action by the earlier of
(1) 45 days after such Seller shall have received notice of such action and (2)
the date by which any filing must be made with the court or administrative body
adjudicating any such action or any other action must be taken in order not to
relinquish any legal rights applicable to the Company or any of its Controlling
Persons, or (C) such indemnified party or parties shall have reasonably
concluded that there may be defenses available to it which are different from or
additional to those available to such Seller (in which case such Seller shall
not have the right to direct the defense of such action on behalf of the
indemnified party or parties), in either such event, the fees and expenses of
not more than one additional firm of attorneys for each of the Company and/or
such underwriter shall be borne by
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such Seller. Such Seller shall not be liable to indemnify any Person for any
settlement of any such action, suit or proceeding effected without such Seller's
written consent.
In order to provide for just and equitable contribution to
joint liability under the Securities Act in any case in which the Company's
exercise of its rights under this Section 4.4 involves a claim for
indemnification pursuant to this Section 4.4, but it is judicially determined
(by the entry of a final judgment or decree by a court of competent jurisdiction
and the expiration of time to appeal or the denial of the last right of appeal)
that such indemnification may not be enforced in such case notwithstanding that
this Section 4.4 provides for indemnification then, in such case, the Company
and such Seller shall contribute to the aggregate losses, claims, damages or
liabilities to which they may be subject (after contribution from others) in
such proportion as is appropriate to reflect the relative fault of the Company
on the one hand and of such Seller on the other hand in connection with the
statements or omissions which resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault of the Company on the one hand and of such Seller on the other
hand shall be determined by reference to, among other things, whether the untrue
or alleged untrue statement of a material fact or omission or alleged omission
to state a material fact relates to information supplied by the Company on the
one hand or by such Seller on the other hand and their relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission; provided, however, that, in any such case, (A) no such
Seller will be required to contribute any amount in excess of the public
offering price of all such Registrable Securities offered by it pursuant to such
registration statement; and (B) no Person or entity guilty of any fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
will be
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entitled to contribution from any other Person that was not guilty of fraudulent
misrepresentation within the meaning of Section 11(f) of the Securities Act.
Section 4.5 Cooperation of Registered Holders. Whenever under the
preceding Sections of this Article IV any Registered Holder is registering any
Registrable Securities pursuant to any registration statement, each such
Registered Holder agrees to timely provide to the Company, such information and
materials as the Company may reasonably request in order to effect the
registration of such Registrable Securities.
Section 4.6 Assignment of Registration Rights. The rights to cause the
Company to register Registrable Securities pursuant to this Article IV may be
assigned (but only with all related obligations) by an Investor to a Permitted
Transferee, provided that: (a) within a reasonable time before such transfer,
the Company is furnished with written notice of the name and address of the
proposed transferee and the number and type of Registrable Securities with
respect to which such registration rights are being assigned; (b) immediately
following such transfer, further disposition of such Registrable Securities by
the proposed transferee is restricted under the Securities Act; (c) in the
Company's judgment, such proposed transferee is not a competitor of the Company
or any of its subsidiaries; and (d) such transfer is not otherwise prohibited by
the terms of any applicable law or regulation or any lock-up agreement
(including, without limitation, the Lock-Up Agreement) then in effect with
respect to the Securities or the Registrable Securities; (e) the Company
receives an opinion of counsel, acceptable to the Company in its sole
discretion, that such assignment does not violate the Securities Act or
applicable state securities laws or regulations; and (f) the proposed transferee
agrees to execute and deliver to the Company an original counterpart signature
page to this Agreement, thereby agreeing to be bound by the terms hereof.
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Section 4.7 Delay of Registration. No holder of any Securities or
Registrable Securities shall have any right to obtain or seek an injunction
restraining or otherwise delaying any registration as the result of any
controversy that might arise with respect to the interpretation or
implementation of this Article IV.
Section 4.8 No Required Exercise or Conversion. Nothing contained in
this Agreement shall be construed as requiring the Investors or any other
holder(s) to convert the Notes or exercise the Warrants, as the case may be,
prior to the initial filing of any registration statement or the effectiveness
thereof.
Section 4.9 Investor Compensation of Underwriter. In connection with
any registration made pursuant to Section 4.1 or 4.2 hereof, the Registered
Holders agrees as follows: (a) any public sale of Registrable Securities
included in the relevant registration statement shall be effected through the
underwriter, if any, for such registration and (b) such Registered Holders shall
compensate the underwriter in accordance with its customary compensation
practices for such transactions.
ARTICLE V.
CONDITIONS
Section 5.1 Conditions Precedent to the Obligation of the Company to
Issue the Notes. The obligation hereunder of the Company to issue the Notes and
the Warrants to the Investors is subject to the satisfaction, at or before the
applicable Closing Date, of each of the conditions set forth below. These
conditions are solely for the benefit of the Company and its subsidiaries and
may be waived by the Company at any time in its sole discretion.
(a) Accuracy of the Investors' Representations and Warranties. The
representations and warranties of each Investor contained herein and all
statements made and information
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provided by each Investor in such Investor's Investor Questionnaire shall be
true and correct in all material respects as of the date when made and as of
such Closing Date as though made at that time (except for representations and
warranties that speak as of a particular date).
(b) Performance by the Investors. Each Investor shall have performed
all agreements and satisfied all conditions required to be performed or
satisfied by such Investor at or prior to such Closing Date.
(c) No Injunction; No Litigation. No statute, rule, regulation,
executive order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court or governmental authority which prohibits
the consummation of any of the transactions contemplated by this Agreement. No
action, suit or proceeding shall have been commenced before any court or
governmental authority or threatened and no investigation shall have been
commenced or have been threatened against the Company, any of its subsidiaries,
or any Investor (i) seeking to restrain, prevent or change the transactions
contemplated hereby or questioning the validity or legality of any such
transaction or (ii) which would, if resolved adversely to the Company, such
subsidiary or Investor, either severally or in the aggregate, have a Material
Adverse Effect or invalidate or call into question the availability of an
exemption applicable to the Offering under the Securities Act.
Section 5.2 Conditions Precedent to the Obligation of the Investors to
Purchase the Notes and the Warrants. The obligation hereunder of each Investor
to acquire and pay for the Notes and the Warrants is subject to the
satisfaction, at or before the applicable Closing Date, of each of the
conditions set forth below. These conditions are for the Investors' sole benefit
and may be waived by any Investor at any time in its sole discretion.
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(a) Accuracy of the Company's Representations and Warranties. The
representation and warranties of the Company shall be true and correct in all
material respects as of the date when made and as of such Closing Date as though
made at that time (except for representations and warranties that speak as of a
particular date).
(b) Performance by the Company. The Company shall have performed all
agreements and satisfied all conditions required to be performed or satisfied by
the Company at or prior to such Closing Date.
(c) No Injunction; No Litigation. No statute, rule, regulation,
executive order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court or governmental authority which prohibits
the consummation of any of the transactions contemplated by this Agreement. No
action, suit or proceeding shall have been commenced before any court or
governmental authority or threatened and no investigation shall have been
commenced or have been threatened against the Company, any of its subsidiaries,
or any Investor (i) seeking to restrain, prevent or change the transactions
contemplated hereby or questioning the validity or legality of any such
transaction or (ii) which would, if resolved adversely to the Company, such
subsidiary or Investor, either severally or in the aggregate, have a Material
Adverse Effect.
(d) Opinion of Counsel. At such Closing Date, the Investors shall have
received an opinion of counsel to the Company in form substantially similar to
the opinion attached hereto as Exhibit C and such other opinions, certificates
and documents as the Investors or their counsel shall reasonably require prior
to or at the Closing.
(e) Secretary's Certificate. The Company shall have delivered to the
Investors a certificate in form and substance reasonably satisfactory to the
Investors, executed by the
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Secretary of the Company on behalf of the Company, certifying as to satisfaction
of closing conditions, incumbency of signing officers, charter, by-laws, good
standing and authorizing resolutions of the Company.
(f) Ramendra Singh Guaranty. Ramendra Singh, the holder of over 50% of
the issued and outstanding shares of Common Stock at the date hereof, shall have
executed and delivered an unconditional guaranty, substantially in the form of
Exhibit D attached hereto, whereby he unconditionally guarantees the payment
when due of the obligations of the Company under the Notes (the "Guaranty").
ARTICLE VI.
LEGEND AND STOCK
Each certificate representing any Notes, Warrants, Note Shares, or
Warrant Shares shall be stamped or otherwise imprinted with a legend
substantially in the following form:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR APPLICABLE STATE SECURITIES
LAWS AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED,
ASSIGNED OR OTHERWISE DISPOSED OF EXCEPT (i) PURSUANT TO A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS
WHICH IS EFFECTIVE AND CURRENT WITH RESPECT TO THESE SECURITIES OR (ii)
PURSUANT TO A SPECIFIC EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT AND APPLICABLE STATE SECURITIES LAWS, BUT ONLY IF (a) THE HOLDER
HEREOF HAS FIRST OBTAINED THE WRITTEN OPINION OF COUNSEL TO THE
COMPANY, OR OTHER COUNSEL ACCEPTABLE TO THE COMPANY, THAT THE PROPOSED
DISPOSITION IS CONSISTENT WITH ALL APPLICABLE PROVISIONS OF THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS AND (b) THE LOCK-UP
AGREEMENT TO WHICH THE ORIGINAL HOLDER IS (AND ITS PERMITTED
TRANSFEREES WILL BE) SUBJECT IS WAIVED OR IS NOT IN EFFECT.
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The certificates representing any Note Shares or Warrant Shares issued
upon conversion of any Notes or Warrant Shares issued upon exercise of any
Warrants shall bear a legend in substantially the same form as the legend on the
Notes and the Warrants indicated above.
ARTICLE VII.
TERMINATION
Section 7.1 Termination by Mutual Consent. This Agreement may be
terminated at any time prior to the Initial Closing Date by the mutual written
consent of the Company and the Investors.
Section 7.2 Other Termination. This Agreement may be terminated by
action of the Board of Directors of the Company or by any of the Investors with
respect to such Investor at any time if the Initial Closing Date shall not have
been consummated by the fifth business day following the date of this Agreement.
ARTICLE VIII.
MISCELLANEOUS
Section 8.1 Stamp Taxes; Agent Fees. The Company shall pay all stamp
and other taxes and duties levied in connection with the issuance of the Notes
and Warrants pursuant hereto and the Note Shares issued upon conversion of the
Notes and the Warrant Shares issued upon the exercise of the Warrants.
Section 8.2 Specific Enforcement; Consent to Jurisdiction.
(a) The Company and the Investors acknowledge and agree that in the
event any of the provisions of this Agreement were not performed in accordance
with their specific terms or were otherwise breached, irreparable injury and
damage would occur, which injury and damage cannot be adequately compensated for
by money damages. Accordingly, the parties agree that
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they shall be entitled to an injunction or injunctions to prevent or cure
breaches of the provisions of this Agreement and to enforce specifically the
terms and provisions hereof, the same being in addition to any other remedy to
which any of them may be entitled by law or equity.
(b) Each of the Company and each Investor (i) hereby irrevocably
submits to the exclusive jurisdiction of the United States District Court, the
New York State courts and other courts of the United States sitting in New York
County, New York, for the purposes of any suit, action or proceeding arising out
of or relating to this Agreement and (ii) hereby waives, and agrees not to
assert in any such suit, action or proceeding, any claim that such party is not
personally subject to the jurisdiction of such court, that such suit, action or
proceeding is brought in an inconvenient forum or that the venue of such suit,
action or proceeding is improper. The Company and each of the Investors consents
to process being served in any such suit, action or proceeding by mailing a copy
thereof to such party at the address in effect for notices to it under this
Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing in this paragraph shall affect or
limit any right to serve process in any other manner permitted by law.
Section 8.3 Entire Agreement; Amendment. This Agreement, together with
the Notes, the Warrants, the Investor Questionnaires and the agreements and
documents executed in connection herewith and therewith, contains the entire
understanding of the parties with respect to the matters covered hereby and
thereby and, except as specifically set forth herein or therein, neither the
Company nor any Investor makes any representation, warranty, covenant or
undertaking with respect to such matters. No provision of this Agreement may be
waived or amended other than by a written instrument signed by the party against
whom enforcement of any such amendment or waiver is sought.
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Section 8.4 Notices. Except as otherwise specified in Section 4.1 or
4.2 hereof, all notices and other communications hereunder shall be in writing
and shall be deemed to be received when delivered personally or sent by
facsimile with written confirmation of complete transmission, one day after
being sent by overnight courier service or express mail requiring signed
acknowledgment of delivery, or five (5) business days after mailing by
registered or certified mail, return receipt requested and all postage and
certified or registration fees prepaid, in all cases, if addressed to the party
for whom intended at the address for such party set forth below or to such other
address as such party may designate by notice given in accordance with the
provisions of this Section 8.4:
to the Company: Dynacs Inc.
35111 U.S. Highway 19 North
Suite 300
Palm Harbor, Florida 34684
Attn.: Dr. Ramendra P. Singh, President
Fax No.: (727) 787-2503
with copies to: Frankfurt, Garbus, Klein & Selz, P.C.
488 Madison Avenue
New York, New York 10022
Attn.: Gary A. Schonwald, Esq.
Fax No.: (212) 593-9175
to the Investors: To each Investor at the address set forth on
Schedule I of this Agreement
with copies to: H.C. Wainwright & Co., Inc.
One Boston Place
40th Floor
Boston, MA 02108
Attn.: Matthew La Fontaine, Associate
Fax No.: (617) 788-9520
Section 8.5 Indemnity. Each party shall indemnify each other party
against any loss, cost or damages (including reasonable attorney's fees but
excluding consequential damages) incurred
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as a result of such party's breach of any representation, warranty, covenant or
agreement in this Agreement.
Section 8.6 Waivers. No waiver by any party of any default with respect
to any provision, condition or requirement of this Agreement shall be deemed to
be a continuing waiver in the future or a waiver of any other provision,
condition or requirement hereof, nor shall any delay or omission of any party to
exercise any right hereunder in any manner impair the exercise of any such right
accruing to it thereafter.
Section 8.7 Headings. The headings herein are for convenience only, do
not constitute a part of this Agreement and shall not be deemed to limit or
affect any of the provisions hereof.
Section 8.8 Successors and Assigns. Except as otherwise provided
herein, this Agreement shall be binding upon and inure to the benefit of the
parties and their successors and permitted assigns. The parties hereto may amend
this Agreement without notice to or the consent of any third party, other than
certain obligees of the Company with respect to certain Company indebtedness who
agreed to subordinate their rights to certain rights of the Investors under
their Notes. The Company may not assign this Agreement or any rights or
obligations hereunder without the prior written consent of all Investors (which
consent may not be unreasonably withheld), except that: the Company may assign
this Agreement in connection with a merger, consolidation, business combination
or the sale of all or substantially all of its assets provided that the Company
is not released from any of its obligations hereunder or such successor in
interest or assignee assumes all obligations of the Company hereunder, and
appropriate adjustment of the provisions contained in this Agreement is made, in
form and substance satisfactory to the Investors, to place the Investors in
substantially the same position as they would have been but for such assignment;
and anything contained herein to the contrary
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notwithstanding, no Investor shall have the right to approve or consent to a
merger undertaken by the Company solely for the purposes of changing its state
of incorporation. Any Investor may assign this Agreement (in whole or in part)
or any rights or obligations hereunder without the consent of the Company in
connection with any sale or transfer of all or any portion of the Notes or the
Warrants held by such Investor, provided, however, that no Investor may assign
this Agreement except to a Permitted Transferee and only if such assignment is
exempt from the registration requirements of the Securities Act and applicable
state securities laws and (ii) the Company receives an opinion of counsel to the
Company or other counsel satisfactory to the Company that such exemption from
registration requirements is available for such assignment or transfer.
Section 8.9 No Third Party Beneficiaries. This Agreement is intended
for the benefit of the parties hereto, the Company's subsidiaries and their
respective permitted successors and assigns and their respective Control
Persons, but only as expressly set forth herein and is not for the benefit of,
nor may any provision hereof be enforced by, any other Person.
Section 8.10 Governing Law. This Agreement has been prepared,
negotiated, executed and delivered in the state of New York and shall be
governed by and construed and enforced in accordance with the internal laws of
the State of New York without regard to such State's principles of conflict of
laws.
Section 8.11 Survival. The representations and warranties and the
agreements and covenants of the Company and each Investor contained herein shall
survive the applicable Closing.
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Section 8.12 Execution. This Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same agreement, it
being understood that all parties need not sign the same counterpart.
Section 8.13 Publicity. The Company agrees that it will not disclose,
and will not include in any public announcement, the name of any Investor
without its consent, unless and until such disclosure is required by law or
applicable regulation or legal process, and then only to the extent of such
requirement, provided that the Company may name the Investors in any filing with
the Commission, the NASD, the NASDAQ Stock Market, any securities exchange or
any state securities commission or similar state regulatory body.
Section 8.14 Severability. The parties acknowledge and agree that the
Investors are not agents, Affiliates or partners of each other, that all
representations, warranties, covenants and agreements of the Investors hereunder
are several and not joint, that no Investor shall have any responsibility or
liability for the representations, warrants, agreements, acts or omissions of
any other Investor, and that any rights granted to "Investors" hereunder shall
be enforceable by each Investor hereunder in respect of such Investor.
Section 8.15 Like Treatment of Holders. Neither the Company nor any of
its Affiliates shall, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee, payment for the redemption or
exchange of Notes or the Warrants, or otherwise, to any holders of Notes or
Warrants, as the case may be, for or as an inducement to, or in connection with
the solicitation of, any consent, waiver or amendment of any terms or provisions
of the Notes or the Warrants or this Agreement, unless such consideration is
required to be paid to all Registered Holders of Notes or Warrants, as the case
may be, bound by such consent, waiver or amendment whether or not such
Registered Holders so consent, waive or agree to amend and
44
<PAGE> 45
whether or not such Registered Holders tender their Notes or Warrants, as the
case may be, for redemption or exchange. The Company shall not, directly or
indirectly, redeem any Notes unless such offer of redemption is made pro rata to
all Registered Holders of Notes on identical terms. The Company shall not,
directly or indirectly, redeem any Warrants unless such offer of redemption is
made pro rata to all Registered Holders of Warrants on identical terms.
Section 8.16 Certain Definitions. As used in this Agreement, the
following terms shall have the following respective meanings:
"Arbitration Proceedings" shall mean the claims of the Company against
Juno Pix, Inc., New Line Pictures, Inc. and New Line Cinema, Inc. in connection
with colorization and other work undertaken by the Company for the motion
picture, "Pleasantville," and the related claims of Juno, New Line Pictures
and/or New Line Cinema against the Company, all before the American Arbitration
Association in California.
"Affiliate" shall have the meaning set forth in Rule 405 promulgated
under the Securities Act.
"Closing" and "Closing Date" shall have the meanings ascribed to such
terms in Section 1.3 herein.
"Cerulean" shall have the meaning ascribed to it in Section 2.1(c)
hereof.
"Commission" shall mean the Securities and Exchange Commission or any
other Federal agency at the time administering the Securities Act.
"Controlling Person" shall mean any Person that controls another Person
within the meaning of Section 15 of the Securities Act.
45
<PAGE> 46
"Conversion Date" with respect to each Investor shall mean the close of
business on the first business day following the date on which the Company
receives a Notice of Conversion (as defined in the Note) from such Investor.
"Documents" shall mean the Confidential Offering Memorandum of the
Company dated February 8, 2000 which includes the Term Sheet, certain
information concerning the Company and its business, the forms of the Notes, the
Warrants, this Agreement and the Guaranty, each such document as the same may
have been amended or supplemented.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
"Escrow Agent" shall mean Continental Stock Transfer & Trust Company.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Guaranty" shall have the meaning set forth in Section 5.2(f) hereof.
"Investor" shall mean each Person that executes a counterpart signature
page to this Agreement and is listed as an Investor on Schedule I attached to
this Agreement and, as the context may require, each Person that purchases
Securities in this Offering.
"Investor Questionnaires" shall mean, collectively, the Investor
Questionnaires, in the form attached to the Offering Memorandum, provided by
each Investor to the Company in connection with the Offering.
"Lock-Up Agreement" shall have the meaning given to it in Section
2.2(d) hereof.
"Majority Holders" shall mean Registered Holders that, in the
aggregate, own beneficially, more than fifty percent (50%) of the Registrable
Securities that are not held by the Company or any of its officers, directors,
creditors, employees or agents or any of their respective Affiliates, family
members, or Persons acting as nominees of any of them and that have not been
resold to the public pursuant to a registration statement filed with the
Commission
46
<PAGE> 47
under the Securities Act or pursuant to Rule 144 promulgated under the
Securities Act; provided, however, that a Majority Holders shall not be the
beneficial owners of less than an aggregate of 35,000 Registrable Securities
(the "Minimum Amount"); and provided, further, however, that in the event the
piggyback registration rights pursuant to Section 4.1 hereof have not been
available for exercise within the twelve-month period prior to the exercise of a
demand registration pursuant to Section 4.2 hereof, the Minimum Amount shall be
reduced to zero.
"Managing Underwriter" shall mean the managing underwriter or the
representative of the underwriters.
"Material Adverse Effect" shall mean any adverse effect on the
business, operations, properties, prospects, or financial condition of the
entity with respect to which such term is used and which is material to such
entity and other entities controlling or controlled by such entity taken as a
whole, and any material adverse effect on the transactions contemplated under
this Agreement or any other agreement or document contemplated hereby or
thereby.
"Maturity Date" shall mean the maturity date of the Notes, as set forth
therein.
"Mezzanine Financing" shall mean shall mean the sale of at least
$2,000,000 (before deducting commissions and expenses) in Mezzanine Securities,
subsequent to the closing of the Offering, through an offering exempt from
registration under Section 4(2) and/or Regulation D promulgated under the
Securities Act.
"Mezzanine Securities" shall mean the equity or equity-linked
securities, if any, that may be offered for sale by the Company pursuant to a
Mezzanine Financing.
"NASD" shall mean the National Association of Securities Dealers, Inc.
"Notes" shall mean the Senior Subordinated Convertible Notes issued by
the Company pursuant to the Offering.
47
<PAGE> 48
"Offering" shall mean the offering by the Company of the Securities
pursuant to Regulation D promulgated under the Securities Act.
"Offering Memorandum" shall mean the Confidential Private Offering
Memorandum of the Company, dated February 8, 2000, as amended or supplemented.
"Permitted Transferee" shall mean any Person to whom any Registered
Holder or other Permitted Transferee transfers Securities or Registrable
Securities (that have not been sold to the public in compliance with the
Securities Act) or the registration rights conferred by Section 4.1 or Section
4.2 (but only as the context may require), in compliance with the terms of this
Agreement, the Securities Act, and applicable state securities laws and
regulations.
"Person" shall mean an individual, firm corporation, limited liability
company, partnership, trust, firm, incorporated or unincorporated association,
joint venture, joint stock company, government (or agency or political
subdivision thereof) or other entity of any kind, and any successor (by merger
or otherwise) of any such entity.
"Prior Offering" shall mean the Company's offering and sale of
$1,000,000 in principal amount of senior convertible subordinated notes and
warrants to purchase 150,000 shares of Common Stock pursuant to an offering
memorandum dated October 1999.
"Registered Holder" shall mean the original Investors and any Permitted
Transferee. The terms "register", "registered" and "registration" shall refer to
a registration effected by preparing and filing a registration statement in
compliance with the Securities Act and applicable rules and regulations
thereunder, and the declaration or ordering of the effectiveness of such
registration statement.
"Registrable Securities" shall mean, collectively, the shares of Common
Stock issuable upon exercise of the Warrants (the "Warrant Shares") and upon
conversion of the Notes (the
48
<PAGE> 49
"Note Shares") (if such conversion is permissible on the date of determination
of the securities constituting Registrable Securities), along with any other
securities issued (or issuable to a Registered Holder upon the conversion of any
Note or exercise of any Warrant) or any other security which is issued to a
Registered Holder in respect of any Registrable Securities as a result of any
stock split, stock dividend, recapitalization or similar event or upon exchange
of the shares of Common Stock, issued or issuable upon exercise of the Warrants
or the conversion of the Notes and any other securities of the Company issued as
a dividend or other distribution with respect to, in exchange for or in
replacement of the Warrant Shares or the Note Shares; provided, however, that
the term "Registrable Securities" shall not apply to any shares of Common Stock
remaining unregistered following the 90th day after such time as Rule 144(k)
under the Securities Act first becomes available for the sale of all Registrable
Securities without restriction.
"Registration Period" shall have the meaning set forth in Section 4.1
hereof.
"Regulation D" shall mean Regulation D as promulgated pursuant to the
Securities Act, and as subsequently amended.
"Rule 144" shall mean Rule 144 promulgated under the Securities Act.
"Securities" shall mean the Notes and the Warrants.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Seller" shall mean a Registered Holder of Note Shares and/or Warrant
Shares, any of which have been or are being registered pursuant to an effective
registration statement filed with the Commission under the Securities Act in
accordance with the provisions of Section 4.1 and/or 4.2 hereof.
"Subsidiaries" shall mean the subsidiaries of the Company listed on
Annex A hereto.
49
<PAGE> 50
"Warrants" shall mean the warrants to purchase shares of common stock
of the Company issued by the Company pursuant to this Agreement and the
Offering.
[BALANCE OF THIS PAGE INTENTIONALLY LEFT BLANK]
50
<PAGE> 51
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
DYNACS INC.
By:
-------------------------------------
Name: Harry Schubele, III
Title: Senior Vice President
INVESTOR:
By:
-------------------------------------
Name:
Exact Name in Which Note(s) Should
be registered:
51
<PAGE> 52
EXHIBITS AND SCHEDULES
Schedule I List of Investors
Exhibit A Form of Note
Exhibit B Form of Warrant
Exhibit C Form of Opinion of Counsel
Exhibit D Form of Guaranty of Ramendra Singh
Annex A Subsidiaries
Annex B Other Entities
<PAGE> 53
SCHEDULE I
<TABLE>
<CAPTION>
INVESTOR NOTE PRINCIPAL AMOUNT WARRANT SHARES
- -------- --------------------- --------------
<S> <C> <C>
</TABLE>
<PAGE> 54
EXHIBIT A
FORM OF NOTE
<PAGE> 55
EXHIBIT A
FORM OF NOTE
<PAGE> 56
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), AND MAY NOT BE OFFERED, TRANSFERRED, SOLD, PLEDGED,
HYPOTHECATED, ASSIGNED OR OTHERWISE DISPOSED OF EXCEPT (i) PURSUANT TO A
REGISTRATION STATEMENT UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS WHICH
HAS BECOME EFFECTIVE AND IS CURRENT WITH RESPECT TO THESE SECURITIES, OR (ii)
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE ACT BUT ONLY IF (a) THE
REGISTERED HOLDER HEREOF HAS FIRST OBTAINED THE WRITTEN OPINION OF COUNSEL TO
DYNACS INC. (THE "COMPANY"), OR OTHER COUNSEL ACCEPTABLE TO THE COMPANY, TO THE
EFFECT THAT THE PROPOSED DISPOSITION IS CONSISTENT WITH ALL APPLICABLE
PROVISIONS OF THE ACT AS WELL AS ANY APPLICABLE STATE SECURITIES LAWS.
DYNACS INC.
SECOND SENIOR SUBORDINATED CONVERTIBLE PROMISSORY NOTE
The Transferability of this Note
is Restricted as Provided in Section 6
CERTAIN CAPITALIZED TERMS USED IN THIS NOTE ARE DEFINED IN SECTION 1.1
<TABLE>
<S> <C>
N- Dated: February , 2000
----- ----
$ New York, New York
----------
</TABLE>
FOR VALUE RECEIVED, DYNACS INC., a Delaware corporation (the
"Company"), promises to pay to ___________________________ or his Permitted
Transferee(s) (the "Registered Holder"), the principal amount of _____________
Thousand Dollars and no/100 ($___,000.00), and to pay interest (computed on the
basis of 360-day years, each of twelve 30-day months) on the unpaid principal
amount hereof at the initial rate of eight percent (8%) per annum during the
period commencing on the date hereof until and including the 120th day from such
date and thereafter at a rate of fifteen percent (15%) per annum until the
earlier of: (i) the conversion of the unpaid principal amount and the accrued
but unpaid interest of this Note into shares of common stock of the Company, par
value $.01 per share ("Common Stock"), at the option of the Registered Holder
after a Liquidity Event in accordance with the terms of Section 5(a) hereof;
(ii) the unpaid principal amount and the accrued but unpaid interest of this
Note is exchanged for, or converted into, Mezzanine Securities in accordance
with the terms of Section 5(b) hereof; or (iii) repayment in full of the
principal amount and accrued and unpaid interest on this Note. Interest due
shall be payable by the Company on a quarterly basis in accordance with the
terms of Section 3 hereof. Principal and accrued but unpaid interest hereunder
shall be due and payable in cash on the Maturity Date, subject to the terms and
conditions of Sections 5 and 6 hereof. For the purposes of this Note, "cash"
shall mean such coin or currency of the United States of America which, at the
time of payment, constitutes legal tender for the payment of public and private
debts.
<PAGE> 57
This Note is one of a series of Second Senior Subordinated Convertible
Notes (the "Notes") issued by the Company pari passu to the several purchasers
of the Notes and certain warrants (the "Warrants") to purchase shares of Common
Stock pursuant to the terms of that certain Second Warrant and Senior
Subordinated Convertible Note Purchase Agreement, dated as of the date hereof
(the "Agreement"), and the terms of the Company's private offering of the Notes
and Warrants commencing February 8, 2000 (the "Offering"). The Registered Holder
of this Note has certain rights, including the right to convert this Note into
shares of Common Stock or Mezzanine Securities pursuant to the terms of this
Note. The registered holders of the Note Shares, if any, issuable upon
conversion of this Note have certain rights, as set forth in the Agreement.
1. This Note is subject to the additional terms and conditions set forth
below:
1.1 Definitions. The following terms, as used in this Note, shall
have the meanings ascribed to them below:
"Affiliate" shall have the meaning set forth in Rule 405 promulgated
under the Securities Act.
"Change of Control" shall have the meaning set forth in Section 8(d)
hereof.
"Conversion Date" shall have the meaning set forth in Section 5(d)
hereof.
"Conversion Price" shall have the meaning set forth in Section 5(c)
hereof.
"Event of Default" shall have the meaning set forth in Section 8
hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Interest Payment Date" shall mean each of May ___, August ___,
November ___, and February ___, commencing in May 2000 and prior to the Maturity
Date.
"Liquidity Event" shall mean each of (i) an initial public offering of
Common Stock by the Company pursuant to an effective registration statement on
an appropriate form filed with the Commission and (ii) the Company's sale of all
or substantially all of its assets to another entity other than an Affiliate of
the Company.
"Lock-Up" shall mean the lock-up agreement to be signed by each
Registered Holder of a Note providing that (a) its Note, the Note Shares, its
Warrant and the Warrant Shares cannot be transferred or otherwise disposed of,
directly or indirectly, for a period of 180 days following the effective date of
the registration statement, if any, filed by the Company in connection with an
initial public offering of its securities, or such longer period as the NASD may
require, except (i) with the prior written consent of Wainwright or (ii) if the
transfer or other disposition is made to
2
<PAGE> 58
any Affiliates of such Registered Holder, as a bona fide gift or to any trust,
and/or (b) such other restrictions on transfer as the NASD may require in
connection with such initial public offering.
"Majority Holders" shall mean the Registered Holders of more than fifty
percent (50%) in aggregate principal amount of the Notes then outstanding.
"Material Adverse Effect" shall mean any adverse effect on the
business, operations, properties, prospects, or financial condition of the
entity or entities with respect to which such term is used and which is material
to such entity and other entities controlling or controlled by such entity taken
as a whole, and any material adverse effect on the transactions contemplated
under this Agreement or any other agreement or document contemplated hereby or
thereby.
"Maturity Date" shall mean the first anniversary date of this Note.
"Mezzanine Financing" shall mean the sale of at least $2,000,000
(before deducting commissions and expenses) in Mezzanine Securities, subsequent
to the closing of the Offering, through an offering exempt from registration
under Section 4(2) and/or Regulation D promulgated under the Act.
"Mezzanine Securities" shall mean the equity or equity-linked
securities, if any, that may be offered for sale by the Company pursuant to a
Mezzanine Financing.
"NASD" shall mean the National Association of Securities Dealers, Inc.
"Note Shares" shall mean shares of Common Stock into which this Notes
is convertible.
"Notice of Conversion" shall mean the notice, substantially in the form
of Exhibit A attached hereto, given by the Registered Holder hereof to the
Company of such Holder's election to convert this Note into Note Shares.
"Permitted Transferee" shall mean any Person to whom any Registered
Holder or other Permitted Transferee transfers this Note or the Note Shares in
compliance with the terms of the Agreement, the Securities Act and the
regulations promulgated thereunder and applicable state securities laws and
regulations.
"Person" shall mean an individual, firm corporation, limited liability
company, partnership, trust, firm, incorporated or unincorporated association,
joint venture, joint stock company, government (or agency or political
subdivision thereof) or other entity of any kind, and any successor (by merger
or otherwise ) of any such entity.
"Registered Holder" shall mean the Person to whom this Note is first
issued and any Permitted Transferees hereof.
3
<PAGE> 59
"Registered Holders" shall mean the Persons to whom the Notes are first
issued and any Permitted Transferees thereof.
"Securities Act" shall mean the Securities Act of 1933, as the same may
be amended from time to time.
"Significant Subsidiary" shall have the meaning ascribed to it in Rule
405 promulgated under the Securities Act.
"Wainwright" shall mean H. C. Wainwright & Co., Inc., the placement
agent for the Offering.
This Note is subject to the following terms and conditions.
1.2 Unsecured Obligations; Subordination. This Note and the
amounts payable hereunder, including principal and accrued interest, are
unsecured obligations of the Company, and shall be subordinate and junior to
indebtedness incurred by the Company pursuant to (a) currently existing
equipment financings, (b) currently existing debt of approximately $585,000
secured by certain revenues pursuant to a Loan Agreement dated May 10, 1999; and
(c) up to an aggregate of $6,000,000 of indebtedness currently existing or
hereinafter incurred by the Company under a working capital facility with First
National Bank of Florida, or the renewal or replacement thereof with any
financial institution, bank or commercial lender (collectively, the "Senior
Debt"). Except as set forth in the preceding sentence, the Notes shall not be
subordinate or junior to any other indebtedness of the Company.
2. Covenants. The Company covenants and agrees that, so long as this Note
is outstanding and unpaid:
(a) Payment of Note. The Company will punctually pay or cause to
be paid the principal and interest on this Note at the dates and places and in
the manner specified herein. Any sums required to be withheld from any payment
of principal or interest on this Note by operation of law or pursuant to any
order, judgment, execution, treaty, rule or regulation may be withheld by the
Company and paid over in accordance therewith.
Nothing in this Note or in any other agreement between the holder
hereof and the Company shall require the Company to pay, or such holder to
accept, interest in an amount which would subject the holder to any penalty or
forfeiture under applicable law. In the event that the payment of any charges,
fees or other sums due under this Note or provided for in any other agreement
between the Company and the holder are or could be held to be in the nature of
interest and would subject the holder to any penalty or forfeiture under
applicable law, then ipso facto the obligations of the Company to make such
payment to the holder shall be reduced to the highest rate authorized under
applicable law and, in the event that the holder shall have ever received,
collected, accepted or applied as interest any amount in excess of the maximum
rate of interest permitted to be charged by applicable law, such amount which
would be excess interest
4
<PAGE> 60
under applicable law shall be applied first to the reduction of principal then
outstanding, and, second, if such principal amount is paid in full, the
remainder, if any, shall forthwith be returned to the Company.
(b) Guaranty. All sums owed and payable to the Registered Holder
shall be guaranteed by Dr. Ramendra P. Singh, the Chief Executive Officer,
President and principal stockholder of the Company (the "guarantor").
(c) Maintenance of Corporate Existence; Merger and Consolidation.
The Company will at all times cause to be done all things necessary to preserve
and keep in full force and effect its corporate existence and the corporate
existence of any Significant Subsidiary and all of the respective rights and
franchises of the Company and each Significant Subsidiary, and neither the
Company nor any Significant Subsidiary shall consolidate with or merge into any
other corporation or transfer all or substantially all of its assets to any
Person unless (i) the survivor of such consolidation or merger is the Company or
is a company organized in a state other than the Company's original state of
incorporation into which the Company has merged solely to effect a change in the
state of incorporation of the Company, provided that such surviving company
assumes the obligations of the Company under the Notes pursuant to operation of
law, (ii) the company formed by such consolidation or into which the Company is
merged or to which the assets of the Company are transferred is a company which
expressly assumes all of the obligations of the Company under the Notes, and
(iii) after giving effect to such transaction, no Event of Default and no event
which, after notice or lapse of time, or both, would become an Event of Default,
shall have occurred and be continuing.
(d) Maintenance of Properties. The Company shall reasonably
maintain in good repair, working order and condition its properties and other
assets, and those of any Significant Subsidiary, and from time to time make all
reasonably necessary or desirable repairs, renewals and replacements thereto.
(e) Payment of Taxes. The Company will, and will cause any
Subsidiary to, set aside for payment, or discharge before the same becomes
delinquent, all taxes, assessments and governmental charges levied or imposed
upon the Company or any Subsidiary, as the case may be, or upon their respective
income, profits or property; provided, however, that neither the Company nor any
of its subsidiaries shall be required to pay or discharge or cause to be paid or
discharged any such tax, assessment or charge the amount or the applicability or
validity of which is being contested in good faith by appropriate proceedings.
(f) Compliance with Statutes. The Company will, and will cause any
Significant Subsidiary to, comply in all material respects with all applicable
statutes and regulations of the United States of America and of any State or
municipality thereof, and of any agency of the United States of America, any
such State or municipality, in respect of the conduct of business, and the
ownership of property by the Company or any Significant Subsidiary; provided,
however, that nothing contained in this Section 2.2(f) shall require the Company
or any
5
<PAGE> 61
Significant Subsidiary to comply with any such statute or regulation so
long as its legality or applicability is being contested in good faith.
(g) Liens. The Company shall not, and shall not permit any of its
subsidiaries to, create, incur or suffer to exist any liens, claims or
encumbrances upon any of its assets or properties, except for those in existence
on the date hereof or those incurred in the ordinary course of business.
(h) Restrictions on Dividends, Redemptions, etc. The Company shall
not, and shall cause any of its subsidiaries not to, (i) declare or pay any
dividend or make any other distribution on any equity securities of the Company,
except dividends or distributions payable in equity securities of the Company or
(ii) purchase, redeem or otherwise acquire or retire for value any equity
securities of the Company, except equity securities acquired upon conversion
thereof into other equity securities of the Company.
(i) Transactions with Affiliates. The Company shall not itself,
and shall not permit any of its subsidiaries to, engage in any transaction of
any kind or nature with any Affiliate of the Company or of any of its
subsidiaries, other than a wholly-owned subsidiary, unless such transaction is
upon terms which are fair to the Company or such subsidiary, as the case may be,
and which are reasonably similar to, or more beneficial to the Company or such
subsidiary than the terms deemed likely to occur in similar transactions with
unrelated Persons under the same circumstances.
(j) Indebtedness. The Company shall not, and shall not permit any
of its Subsidiaries to, incur any liability or obligation, direct or contingent,
for borrowed money, except for those liabilities and obligations (i) in
existence on the date hereof, (ii) incurred in the ordinary course of business
or otherwise incurred, provided that the Notes are not subordinate or junior
thereto, (iii) incurred with respect to the Senior Debt, and (iv) any
refinancings, replacements, amendments or modifications of any of the
foregoing."
3. Interest. Interest shall be payable quarterly on the unpaid
principal amount of this Note at rates established in the first paragraph of the
Preamble of this Note on each Interest Payment Date and on the Maturity Date.
4. Maturity. If this Note is not converted into Note Shares at
the option of the Registered Holder in accordance with the terms of Section 5(a)
hereof or converted into Mezzanine Securities in accordance with the terms of
Section 5(b) hereof, the principal amount of this Note, together with all
accrued and unpaid interest thereon, shall be due and payable in cash on the
Maturity Date.
5. Conversion.
(a) Liquidity Event. Upon the occurrence of a Liquidity Event, the
Registered Holder of this Note may convert, at any time after the date which is
120 days after the date of this Note
6
<PAGE> 62
all (but not less than all) unpaid principal of this Note and all accrued and
unpaid interest thereon into a number of Note Shares equal to the quotient of
(i) the unpaid principal and accrued and unpaid interest thereon divided by (ii)
the Conversion Price. Upon conversion of this Note into Note Shares pursuant to
this paragraph, the principal amount of this Note and accrued and unpaid
interest thereon shall have thereby been paid and discharged in full, this Note
shall be canceled, and the holder shall have no recourse to the Company or the
guarantor.
(b) Mezzanine Securities. In the event this Note has not been
converted into Note Shares in accordance with the terms of Section 5(a) hereof
and the Company consummates a Mezzanine Financing while this Note remains
outstanding, the unpaid principal of this Note and accrued and unpaid interest
thereon shall be (i) repaid in cash from the proceeds of the Mezzanine Financing
or (ii) at the election of the Registered Holder in accordance with this Section
5(b), converted into, or exchanged for, an amount of Mezzanine Securities on a
pari passu basis with investors in the Mezzanine Financing. The Company shall
give written notice of the proposed Mezzanine Financing at least five (5) days
prior to the final closing in such Mezzanine Financing. If the Company receives
written notice from the Registered Holder of its election to convert this Note
into, or exchange this Note for, Mezzanine Securities within one (1) business
day prior to the final closing of the Mezzanine Financing, this Note shall be
converted into, or exchanged for, Mezzanine Securities in accordance with the
terms of this Section 5(b). Upon conversion of this Note into Mezzanine
Securities pursuant to this paragraph, the principal amount of this Note and
accrued and unpaid interest thereon shall have thereby been paid and discharged
in full, this Note shall be canceled, and the holder shall have no recourse to
the Company or guarantor.
(c) Conversion Price. The Conversion Price in connection with a
Liquidity Event shall equal (i) sixty percent (60%) of the initial public
offering price per share of Common Stock in the event that the Liquidity Event
is the Company's initial public offering or (ii) in the event the Liquidity
Event is the sale of all or substantially all of the Company's assets to another
entity other than an Affiliate of the Company, sixty percent (60%) of the
consideration received for such assets divided by the total number of shares of
Common Stock outstanding on a fully-diluted basis before such sale.
(d) Method of Conversion. The Registered Holder of this Note shall
not be entitled to receive Note Shares upon the conversion of this Note unless
and until such Holder surrenders this Note and deliver a Notice of Conversion to
Company at its address set forth herein for notices or to an agent designated by
the Company by notice given to the Registered Holder. The Notice of Conversion
shall state therein the amount(s) in which the certificate(s) for Note Shares
are to be issued. The conversion shall be effective on the close of business on
the first business day following the date on which the Company receives the
Notice of Conversion (the "Conversion Date"). Interest on the principal amount
of this Note shall cease to accrue on and after the conversion hereof on the
Conversion Date.
(e) Issuance of Note Shares and Mezzanine Securities. The Company
shall, as soon as practicable after surrender of this Note and receipt of the
Notice of Conversion after the
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<PAGE> 63
occurrence of a Liquidity Event, but in no event more than thirty (30) days
thereafter, issue and deliver to the Registered Holder, one or more certificates
for the number of Note Shares which such Holder is entitled to receive upon such
conversion. The Company shall issue and deliver to the Registered Holder a
certificate(s) evidencing the Mezzanine Securities to which the Holder is
entitled upon conversion or exchange in accordance with the terms of Section
5(b) hereof upon the later of (i) the Closing Date of the Mezzanine Financing
and (ii) surrender of this Note.
(f) Fractional Shares. If any fraction of a Note Share or
Mezzanine Security would be issuable upon conversion of this Note, as the case
may be, the Company shall, at its sole option, issue fractions of Note Shares or
Mezzanine Securities, as the case may be, or purchase such fraction for cash in
an amount equal to the fair market value of such fraction on the Conversion
Date. Nothing contained in this Note shall obligate the Company to issue
fractional Note Shares or Mezzanine Securities, as the case may be, upon the
conversion of this Note.
(g) Adjustments of Conversion Price; Merger.
(i) If, at any time or from time to time after the
consummation of a Liquidity Event while this Note is issued and outstanding, the
Company (A) declares or pays, without consideration, any dividend on the Common
Stock payable in Common Stock, or (B) effects a subdivision of the outstanding
shares of Common Stock into a greater number of shares of Common Stock (by stock
split, reclassification or otherwise than by payment of a dividend in Common
Stock or in any right to acquire Common Stock) or if the number of outstanding
shares of Common Stock is reduced by combination, consolidation,
reclassification, reverse stock split or otherwise, then the Conversion Price in
effect immediately before such Liquidity Event shall, concurrently with the
effectiveness of such Liquidity Event, be proportionately decreased or
increased, as the case may be. If at any time or from time to time after the
consummation of a Liquidity Event while this Note is issued and outstanding, the
Company declares or pays, without consideration, any dividend on the Common
Stock in the form of a right to acquire Common Stock for no consideration, then,
for purposes of this subparagraph (i), the Company shall be deemed to have paid
a dividend in such number of shares of Common Stock as is equal to the maximum
number of shares thereof issuable upon exercise of such rights.
(ii) If, at any time or from time to time after the
consummation of a Liquidity Event while this Note is issued and outstanding, the
Common Stock is changed into the same or a different number of shares of any
other class or classes of stock, whether by capital reorganization,
reclassification or otherwise (other than a subdivision or combination of shares
provided for in Section 5(g)(i) hereof), the Conversion Price then in effect
shall, concurrently with the effectiveness of such reorganization or
reclassification, be proportionately adjusted so that this Note shall be
convertible into the number of shares of such other class or classes of stock
that the Registered Holder of this Note would have been entitled to receive had
such Holder converted this Note into Note Shares immediately prior to such
change.
(iii) The Company shall not merge with or consolidate into
any other corporation, limited liability company or any other entity (each such
transaction, a "Merger"),
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<PAGE> 64
unless the entity surviving or formed by the Merger assumes, by operation of law
or otherwise, all of the obligations contained herein by way of covenants,
stipulations, promises or agreements. In the event of a Merger, the Company
shall make appropriate provisions so that the Registered Holder shall thereafter
have the right to convert this Note into the type and number of securities
receivable upon such Merger by a holder of the number of securities into which
this Note could have been converted immediately prior to such Merger. In the
event that more than one Merger occurs, the provisions contained in this
subparagraph (iii) shall apply to each such Merger.
(h) Reservation of Stock. The Company shall at all times reserve
and keep available out of its authorized but unissued shares of Common Stock,
solely for the purpose of effecting the conversion of the Notes into Note
Shares, such number of shares of Common Stock as shall from time to time be
sufficient to effect the conversion of all Notes; and if at any time the number
of authorized but unissued shares of Common Stock is not sufficient to effect
the conversion of all Notes, then the Company shall take such corporate action
as in the opinion of its counsel may be necessary to increase the number of
authorized but unissued shares of Common Stock to the number of shares
sufficient for such purpose and shall use the Company's best efforts to obtain
the requisite stockholder approval.
(i) Issue Taxes. The Company shall pay any and all taxes other
than income taxes, payable by the Registered Holder of this Note in respect of
the issuance or delivery of Note Shares or other securities in connection with
the conversion of this Note; provided, however, that the Company shall not be
obligated to pay any taxes resulting from any transfer of Note Shares or other
securities issuable upon conversion of this Note to any Person upon the request
of the Registered Holder or otherwise.
6. Restrictions Upon Transferability. This Note has not been registered
under the Securities Act or applicable state securities laws, and may not be
offered, sold, transferred, pledged, hypothecated, assigned or otherwise
disposed of except (a) pursuant to an effective registration statement under the
Securities Act and such state laws which is current with respect to this Note or
(b) pursuant to an exemption from registration under the Securities Act and such
state laws if the Registered Holder hereof shall have first obtained the written
opinion of counsel to the Company or other counsel acceptable to the Company to
the effect that the proposed disposition is consistent with all applicable
provisions of the Securities Act and applicable state securities laws. In
addition, this Note may not be transferred while the Lock-Up, if any, is in
effect except (i) with the prior written consent of Wainwright or (ii) if the
transfer or other disposition (A) is made to any Affiliate of such Registered
Holder, (B) is a bona fide gift, or (C) is made to any trust.
7. No Prepayment. Except as provided in Section 5 hereof, the principal
amount of this Note may not be prepaid, in whole or in part, prior to the
Mezzanine Financing.
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<PAGE> 65
8. Events of Default; Remedies. The occurrence of each of the following
shall constitute an event of default hereunder (each, an "Event of Default"):
(a) Payment of Notes. The default by the Company in the payment of
the principal or interest of this Note, when and as the same becomes due and
payable, whether on the Maturity Date, upon acceleration or otherwise, which
default remains uncured for a period of five (5) days; or
(b) Performance of Covenants, Conditions or Agreements. The
default by the Company in any material respect in the performance or observance
of any material covenant, condition or agreement set forth in this Note, which
default continues uncured for a period of thirty (30) days after the Company
receives written notice from any Registered Holder indicating the particular
Event(s) of Default to have occurred; or
(c) Cross-default. A default by the Company under a material
agreement, which default: (i) is not cured or waived within the cure or other
applicable time periods provided in such agreement; and (ii) has a Material
Adverse Effect.
(d) Change of Control. The acquisition of beneficial ownership (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act) of a majority of the
Company's then outstanding Common Stock by any person or group (as defined in
Section 13(d)(3) of the Exchange Act) of persons, other than (i) the executive
officers and directors of the Company and any individuals nominated to serve as
directors of the Company at the date hereof, (ii) the Registered Holders of the
Notes, and (iii) the Registered Holders of the Warrants.
(e) Bankruptcy, Insolvency, etc. The Company or any Significant
Subsidiary shall file or consent by answer or otherwise to the entry of an order
for relief or approving a petition for relief, reorganization or arrangement or
any other petition in bankruptcy for liquidation or to take advantage of any
bankruptcy or insolvency law of any jurisdiction, or shall make an assignment
for the benefit of its respective creditors, or shall consent to the appointment
of a custodian, receiver, trustee or other officer with similar powers of itself
or of any substantial part of their respective property, or shall be adjudicated
a bankrupt or insolvent, or shall take corporate action for the purpose of any
of the foregoing, or if a court or governmental authority of competent
jurisdiction shall enter an order appointing a custodian, receiver, trustee or
other officer with similar powers with respect to the Company or any Significant
Subsidiary or any substantial part of their respective property or an order for
relief or approving a petition for relief or reorganization or any other
petition in bankruptcy or for liquidation or to take advantage of any bankruptcy
or insolvency law, or an order for the dissolution, winding up or liquidation of
the Company or any Significant Subsidiary, or if any such petition shall be
filed against the Company or any Significant Subsidiary and such petition shall
not be dismissed within sixty (60) days.
(f) Representations and Warranties. If any representation,
warranty or statement of fact made in writing by or on behalf of the Company or
by any officer of the Company herein, in
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<PAGE> 66
the Agreement or in any writing furnished in connection with the transactions
contemplated hereby proves to have been incorrect, false or misleading in any
material respect on the date as of which made.
(g) Remedies. If an Event of Default, other than (i) an Event of
Default resulting from the Company's failure to pay the principal of this Note
or any interest thereon, when the same is due and payable in accordance with the
terms hereof and (ii) an Event of Default resulting from bankruptcy, insolvency
or reorganization, occurs and is continuing, the Majority Holders may declare,
by notice in writing to the Company, all unpaid principal and accrued interest
on all of the Notes then outstanding to be due and payable immediately. Upon the
occurrence of an Event of Default resulting from the Company's non-payment of
principal of, or interest on, this Note, the Registered Holder hereof may
declare all unpaid principal and accrued interest on this Note due and payable
immediately. Upon the occurrence of an Event of Default resulting from
bankruptcy, insolvency or reorganization, the outstanding principal balance of
this Note and accrued and unpaid interest thereon shall be due and payable
immediately without the requirement of any declaration or other act on the part
of the Registered Holder. Any such acceleration may be annulled and past
defaults (except a default in payment of principal or interest on the Note which
has not theretofore been cured) may be waived by the Majority Holders. (l) (m)
The rights and remedies provided herein are cumulative and are not
exclusive of any rights or remedies which any party may otherwise have at law or
in equity.
9. Costs of Collection. If the indebtedness represented by this Note or
any part thereof is collected in any proceeding or if this Note is placed in the
hands of attorneys for collection after the occurrence of an Event of Default,
the Company shall pay, as an obligation under this Note, in addition to the
obligation to pay principal and interest, all costs of collecting this Note,
including reasonable attorneys' fees.
10. Waiver and Amendments. This Note may be amended, modified, superseded,
canceled, renewed or extended, and the terms hereof may be waived only by a
written instrument signed by the Company and the Majority Holders; provided,
however, that the consent of the Registered Holder of each Note shall be
required to modify the terms thereof affecting the payment of the principal
amount of, or interest on, such Note or the Maturity Date thereof. No delay on
the part of any party in exercising any right, power or privilege hereunder
shall operate as a waiver thereof, nor shall any waiver on the part of any party
of any right, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, power or privilege
hereunder.
11. Loss, Theft, Destruction or Mutilation of Note. Upon receipt by the
Company of (a) evidence reasonably satisfactory to the Company of the loss,
theft, destruction or mutilation of this Note and (b) indemnity or security
reasonably satisfactory to the Company, and upon (i) reimbursement to the
Company of all reasonable expenses incidental thereto and (ii) surrender
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<PAGE> 67
and cancellation of this Note, if mutilated, the Company will make and deliver a
new Note of like tenor, in lieu of this Note. Any replacement note made and
delivered in accordance with the provisions of this Section 11 shall be dated
(A) as of the date to which interest has been paid on this Note, or (B) if no
such interest has theretofore been paid, then dated as of the date hereof.
12. Notices. All notices and other communications given hereunder shall be in
writing and shall be deemed to be received when delivered personally or sent by
facsimile with written confirmation of complete transmission, one day after
being sent by overnight courier service or express mail requiring signed
acknowledgment of delivery, or five (5) business days after mailing by
registered or certified mail, return receipt requested with all postage and
certified or registration fees prepaid, in each case if addressed to the party
for whom intended at the address for such party set forth below or to such other
address as such party may designate by notice given in accordance with the
provisions of this Section 12:
(a) if to the Company, to:
Dynacs Inc.
35111 U.S. Highway 19 North
Suite 3000
Palm Harbor, Florida 34684
Attn.: Dr. Ramendra P. Singh, President
with a copy to:
Frankfurt, Garbus, Klein & Selz, P.C.
488 Madison Avenue
New York, New York 10022
Attn.: Gary A. Schonwald, Esq.
(b) if to the Registered Holder, to the address of such
Holder as shown on the books of the Company,
with a copy to:
H.C. Wainwright & Co., Inc.
One Boston Place
40th Floor
Boston, MA 02108
Attn.: Matthew La Fontaine, Associate
13. Governing Law. This Note has been prepared and delivered in the State of New
York and shall be governed by and construed in accordance with the laws of such
State without giving effect to the principles thereof relating to the conflict
of laws. The Company agrees that any dispute or controversy arising out of this
Note shall be adjudicated in a court located in New
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<PAGE> 68
York County, and hereby submits to the exclusive jurisdiction of the federal
courts located in the Southern District of New York, but if such courts shall
not have subject matter jurisdiction, to the courts of the State of New York
located in New York County. The Company irrevocably waives any objection it now
has or hereafter may have with respect to (i) the venue of such action or
proceeding brought in any such court or (ii) the fact that such court is an
inconvenient forum and consents to the service of process in any such action or
proceeding by means of registered or certified mail, return receipt requested.
14. Successors and Assigns. All the covenants, stipulations, promises and
agreements by or on behalf of the Company contained in this Note shall be
binding upon the Company's successors and assigns whether or not so expressed
15. Severability. If any provision of this Note is found by a court of
competent jurisdiction to be invalid, illegal or unenforceable, all other
provisions of this Note shall remain in effect, and if any provision is
inapplicable to any Person or circumstances, such provision shall nevertheless
remain applicable to all other Persons and circumstances. The rate of interest
on this Note is subject to any limitation imposed by applicable usury laws. 6.
16. Headings. The headings in this Note are solely for convenience of
reference and shall be given no effect in the construction or interpretation of
this Note.
IN WITNESS WHEREOF, the Company has caused this Note to be signed in
its corporate name by a duly authorized officer and to be dated as of the date
first above written.
DYNACS INC.
By:
------------------------------------
Harry W. Schubele III
Senior Vice President
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<PAGE> 69
EXHIBIT A
NOTICE OF CONVERSION
The undersigned, being the Registered Holder of the attached Second
Senior Subordinated Convertible Note(s) due the Maturity Date (as defined in the
Note) of DYNACS INC., a Delaware corporation, hereby exercises the option to
convert such Note into Note Shares (as defined in the Note) in accordance with
the terms of such Note.
The undersigned directs that the Note Shares be issued in the name of
the Registered Holder of the attached Note and delivered as soon as practicable
and in accordance with the provisions of the Note to:
Full Address: ____________________________
____________________________
____________________________
By: ____________________________
Signature
Date:______________________ ____________________________
Print Name
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<PAGE> 70
EXHIBIT B
FORM OF WARRANT
<PAGE> 71
Warrant Number: W-____
_______ Warrant Shares
WARRANT
THIS WARRANT AND THE SHARES OF COMMON STOCK INTO WHICH IT IS CONVERTIBLE HAVE
BEEN ACQUIRED FOR INVESTMENT, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT") OR APPLICABLE STATE SECURITIES LAWS
AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED, ASSIGNED OR
OTHERWISE DISPOSED OF EXCEPT (i) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
FILED UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS WHICH IS
CURRENT WITH RESPECT TO SUCH SECURITIES OR (ii) PURSUANT TO A SPECIFIC EXEMPTION
FROM REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS,
PROVIDED THAT (a) THE HOLDER HEREOF HAS FIRST OBTAINED A WRITTEN OPINION OF
COUNSEL TO THE COMPANY OR OTHER COUNSEL ACCEPTABLE TO THE COMPANY THAT THE
PROPOSED DISPOSITION IS CONSISTENT WITH ALL APPLICABLE PROVISIONS OF THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS AND (b) THE LOCK-UP
AGREEMENT TO WHICH THE ORIGINAL HOLDER IS SUBJECT IS WAIVED OR IS NOT IN EFFECT.
This Warrant is one of a series of warrants (collectively, the
"Warrants") issued by Dynacs Inc., a Delaware corporation (the "Company"),
pursuant to the terms of that certain Second Warrant and Senior Subordinated
Convertible Note Purchase Agreement, dated the date hereof (the "Agreement"),
and the terms of the Company's private placement (the "Offering") of the
Warrants and up to $1,900,000 in principal amount of Second Senior Convertible
Subordinated Notes of the Company (collectively, the "Notes").
1. DEFINITIONS. The following capitalized terms, when used in this
Warrant, shall have the meanings given to them below:
"Affiliate" shall have the meaning set forth in Rule 405 promulgated
under the Securities Act.
"Agreement" shall have the meaning set forth in the preamble to this
Warrant.
"Beneficial Ownership" shall have the meaning ascribed to it in Rules
13d-3 and 13d-5 promulgated under the Exchange Act; "Beneficial Owner" shall
have the meaning ascribed to it in Rule 13d promulgated under the Exchange Act.
"Change of Control" shall mean the acquisition by any Person or group
(as defined in Section 13(d)(3) of the Exchange Act) of Persons, other than (i)
the executive officers and directors of the Company and any Persons nominated to
serve as a director of the Company at the date hereof, (ii) the Registered
Holders of the Notes, and (iii) the Registered Holders of the Warrants, of
Beneficial Ownership of a majority of the Company's then outstanding shares of
Common Stock.
<PAGE> 72
"Closing Price" shall have the meaning set forth in Section 6.2 hereof.
"Commission" shall mean the Securities and Exchange Commission.
"Common Stock" shall mean shares of common stock of the Company, par
value $.01 per share.
"Controlling Person" shall mean a Person that controls another Person
within the meaning of Section 15 of the Securities Act.
"Conversion Date" shall mean the date on which a Note is converted into
Note Shares as provided in the Note.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Exercise Price" shall mean the price payable per share of Common Stock
(or such securities as may be substituted for one share of Common Stock pursuant
to the provisions of this Warrant) payable from time to time upon the exercise
of this Warrant (as the same may be adjusted pursuant to the terms hereof),
which shall be as set forth in Section 2.1 hereof.
"Initial Public Offering" shall mean an initial public offering of the
Company's Common Stock, except as otherwise specified in Section 6.2 hereof.
"Issuance Date" shall mean the date on which this Warrant is issued to
the Purchaser, as set forth on the signature page hereto.
"Liquidity Event" shall mean each of (i) an initial public offering of
Common Stock by the Company pursuant to a registration statement filed with the
Commission and (ii) the Company's sale of all or substantially all of its assets
to another entity other than an Affiliate of the Company.
"Lock-Up Agreement" shall mean the lock-up agreement to be signed by
each Registered Holder of a Warrant providing that (a) its Warrant, Warrant
Shares and its Note and Note Shares cannot be transferred or otherwise disposed
of, directly or indirectly, for a period of 180 days following the effective
date of the registration statement, if any, filed by the Company in connection
with an initial public offering of its securities or such longer period as the
NASD may require, except (i) with the prior written consent of Wainwright or
(ii) if the transfer or other disposition is made (a) to any Affiliates of such
Registered Holder, (b) as a bona fide gift or (c) to any trust, or (b) such
other restrictions on transfer as the NASD may require in connection with such
initial public offering.
"Majority Holders" shall have the meaning set forth in Section 7.2(c)
hereof.
"Managing Underwriter" shall mean the managing underwriter or the
representative of the underwriters.
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<PAGE> 73
"Maturity Date" shall mean the maturity date of each Note, which shall
be the first anniversary date thereof.
"Mezzanine Financing" shall mean the sale of at least $2,000,000
(before deducting commissions and expenses) in Mezzanine Securities, subsequent
to the closing of the Offering, through an offering exempt from registration
under Section 4(2) and/or Regulation D promulgated under the Securities Act.
"Mezzanine Securities" shall mean the equity or equity-linked
securities, if any, that may be offered for sale by the Company pursuant to a
Mezzanine Financing.
"NASD" shall mean the National Association of Securities Dealers, Inc.
"NASDAQ System" shall mean the Automatic Quotation System of the
National Association of Securities Dealers, Inc.
"Note Shares" shall have the meaning set forth below in the definition
"Registrable Securities."
"Notes" shall have the meaning set forth in the preamble to this
Warrant.
"Notice of Conversion" shall mean the notice that may be given by the
Registered Holder of a Note to the Company of such Holder's election to convert
such Holder's Note into Note Shares or Mezzanine Securities in compliance with
the terms of the Note.
"Offering" shall have the meaning set forth in the preamble to this
Warrant.
"Permitted Transferee" shall mean any Person to whom any Registered
Holder or other Permitted Transferee transfers this Warrant, or any Warrant
Shares, such Person's Note or other Registrable Securities, as the context may
require, in compliance with the terms of the Agreement, the Securities Act and
the regulations promulgated thereunder and applicable state securities laws and
regulations.
"Person" shall mean an individual, firm, corporation, limited liability
company, partnership, trust, firm, incorporated or unincorporated association,
joint venture, joint stock company, government (or agency or political
subdivision thereof) or other entity of any kind, and any successor (by merger
or otherwise) of any such entity.
"Purchaser" shall mean the Person that purchased this Warrant in the
Offering whose name is set forth on the signature page hereof.
"Registered Holder" shall mean the Purchaser and any Permitted
Transferee(s).
"Registered Holders" shall mean the Registered Holder and the original
purchasers of the Notes and the other Warrants and their Permitted Transferees.
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<PAGE> 74
"Registrable Securities" shall mean, collectively, the shares of Common
Stock issuable upon exercise of the Warrants (the "Warrant Shares") and upon
conversion of the Notes (the "Note Shares") (if such conversion is permissible
on the date of determination of the securities constituting Registrable
Securities), along with any other securities issued (or issuable to a Registered
Holder upon the conversion of any Note or exercise of any Warrant) or any other
security which is issued to a Registered Holder in respect of any Registrable
Securities as a result of any stock split, stock dividend, recapitalization or
similar event or upon exchange of the shares of Common Stock, issued or issuable
upon exercise of the Warrants or the conversion of the Notes and any other
securities of the Company issued as a dividend or other distribution with
respect to, in exchange for or in replacement of the Warrant Shares or the Note
Shares; provided, however, that the term "Registrable Securities" shall not
apply to any shares of Common Stock remaining unregistered following the 90th
day after such time as Rule 144(k) under the Securities Act first becomes
available for the sale of all Registrable Securities without restriction.
"Registration Period" shall have the meaning set forth in Section 7.1
hereof.
"Securities" shall mean the Warrants and the Notes.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Seller" shall mean each Registered Holder of Registrable Securities
that have been registered pursuant to a registration statement filed with the
Commission under the Securities Act pursuant to Section 7 of this Agreement.
"Wainwright" shall mean H.C. Wainwright & Co., Inc.
"Warrant Shares" shall have the meaning set forth above in the
definition of "Registrable Securities." The number of Warrant Shares issuable to
the Registered Holder of this Warrant, subject to adjustment, is as set forth at
page 1 hereof.
"Warrants" shall have the meaning set forth in the preamble to this
Warrant.
2.SHARES SUBJECT TO WARRANT; ADJUSTMENTS.
2.1 NUMBER AND PRICE OF SHARES SUBJECT TO WARRANT. Subject to the
terms and conditions set forth herein, the Registered Holder hereof is entitled
to purchase from the Company, at any time from and after the first anniversary
of the Issuance Date until the earlier of (a) the fifth anniversary of the
Issuance Date or (b) the fourth anniversary of a Liquidity Event, fully-
paid and non-assessable shares of Common Stock, subject to adjustment, upon (a)
surrender hereof to the Company at its address set forth herein for notices or
to its agent designated by notice given hereunder, and (b) at the election of
the Registered Holder, upon either (i) payment of the Exercise Price to the
Company at such address in cash or by certified or bank check or (ii) tender of
a notice and surrender of this Warrant as provided in Section 6.2 hereof.
Subject to adjustment as hereinafter provided, the Exercise Price per share of
Common Stock (or such securities as may be substituted therefor pursuant to the
provisions hereinafter set forth) shall be equal to (A) seventy percent (70%)
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<PAGE> 75
of the initial public offering price per share of Common Stock if the Liquidity
Event is an Initial Public Offering, (B) seventy percent (70%) of the
consideration received for the Company's assets if the Liquidity Event is the
sale of all or substantially all of the Company's assets, divided by the total
number of shares of Common Stock outstanding, on a fully-diluted basis, on the
close of business on the business day immediately prior to the date of such
Liquidity Event, or (C) prior to the occurrence of a Liquidity Event, the fair
market value per share of Common Stock on the last Closing Date (as defined in
the Agreement) as determined by the Board of Directors of the Company in good
faith.
2.2 ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF SHARES. The number and kind of
securities issuable to the Registered Holder hereof upon the exercise of this
Warrant and the Exercise Price shall be subject to adjustment at any time and
from time to time during the period from the date of this Warrant until the
first to occur of its exercise in full or expiration, upon the occurrence of
each of the following events:
(a) ADJUSTMENT FOR DIVIDENDS IN STOCK OR OTHER SECURITIES
OR PROPERTY. If the holders of the Common Stock (or any shares of stock or other
securities at the time receivable upon the exercise of this Warrant) receive,
or, on or after the record date fixed for the determination of eligible
stockholders, become entitled to receive, without payment therefor, other or
additional stock or other securities or property (other than cash) of the
Company by way of a dividend, then, and in each case, upon the exercise hereof,
the Registered Holder hereof shall be entitled to receive, in addition to the
number of Warrant Shares set forth at page 1 hereof and without payment of any
additional consideration therefor, the number of shares of such other or
additional stock or the number of such other securities, or an amount of
property (other than cash) of the Company which such Registered Holder would
hold on the date of such exercise had it been the holder of record of such
shares of Common Stock on the date hereof and had thereafter, during the period
from the date hereof to and including the date of such exercise, retained such
shares and/or all other additional stock or securities during such period,
giving effect to all adjustments required to have been made during such period
by paragraphs (b) and (c) of this Section 2.2.
(b) ADJUSTMENT FOR RECLASSIFICATION, REORGANIZATION OR
MERGER. If any reclassification or change of the outstanding securities of the
Company or any reorganization of the Company (or any other corporation the
securities of which are at the time issuable upon the exercise of this Warrant)
or any similar corporate reorganization, then, and in each such case, upon the
exercise of this Warrant at any time after the consummation of such
reclassification, change, or reorganization, the Registered Holder shall be
entitled to receive, in lieu of the stock or other securities and/or property
receivable upon the exercise hereof prior to such consummation, the stock or
other securities and/or property to which such Registered Holder would have been
entitled upon consummation of such transaction if such Registered Holder had
exercised this Warrant immediately prior thereto, all subject to further
adjustment as provided in paragraphs (a) and (c) of this Section 2.2; and in
each such case, the terms of this Section 2.2 shall be applicable to the shares
of stock or other securities and/or property issuable upon the exercise of this
Warrant after consummation of each such transaction.
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<PAGE> 76
(c) STOCK SPLITS AND REVERSE STOCK SPLITS. If the Company
subdivides its outstanding shares of Common Stock into a greater number of
shares, the Exercise Price in effect immediately prior to such subdivision shall
thereby be proportionately reduced and the number of Warrant Shares shall
thereby be proportionately increased; and, conversely, if the shares of Common
Stock outstanding are combined into a smaller number of shares, the Exercise
Price in effect immediately prior to such combination shall thereby be
proportionately increased and the number of Warrant Shares shall thereby be
proportionately decreased.
3. NO FRACTIONAL SHARES. No fractional shares of Common Stock will be
issued in connection with any exercise hereunder. In lieu of any fractional
shares which would otherwise be issuable, the Company shall pay cash equal to
the product of such fraction multiplied by the fair market value of one share of
Common Stock on the date of exercise, as determined in good faith by the
Company's Board of Directors.
4. NO STOCKHOLDER RIGHTS. This Warrant shall not entitle the holder to any
of the rights of a holder of any class of capital stock of the Company.
5. RESERVATION OF STOCK. The Company covenants that during the period this
Warrant is exercisable, the Company will reserve, from its authorized and
unissued shares of Common Stock, a sufficient number of shares to provide for
the issuance of the Warrant Shares, as adjusted, upon the exercise of this
Warrant. The Company represents and warrants that its officers who are charged
with the duty of executing stock certificates shall have full authority to
execute and deliver certificates for Warrant Shares (or other securities of the
Company issuable) upon exercise of this Warrant.
6. EXERCISE OF WARRANT.
6.1 METHOD OF EXERCISE. This Warrant may be exercised by the
Registered Holder from time to time, in whole or in part, by surrender of this
Warrant, accompanied by (a) the "Election to Exercise," in the form attached
hereto, duly executed, (b) payment to the Company, by cash or certified or bank
check, of an amount equal to the then applicable Exercise Price multiplied by
the number of Warrant Shares for which this Warrant is being exercised, at the
address of the Company set forth herein for notices or to such other address or
to an agent of the Company designated by notice given pursuant to the terms of
Section 12 hereof, and (c) this Warrant, tendered for surrender. This Warrant
shall be deemed to have been exercised immediately prior to the close of
business on the date of its surrender for exercise as provided above, and the
Registered Holder shall be treated for all purposes as the holder of record of
Warrant Shares receivable upon such exercise of this Warrant as of the close of
business on such date. As promptly as practicable on or after such date, the
Company shall issue and deliver to the Registered Holder, at the Company's
expense, a certificate or certificates for the number of full Warrant Shares
issuable upon such exercise, together with cash in lieu of any fraction of a
share as provided above, and, unless this Warrant shall have been exercised in
full or shall have expired, a new Warrant representing the portion of the
Warrant Shares, if any, with respect to which this Warrant has not been
exercised, shall also be issued to the Registered Holder hereof. Any Warrant
Shares issued to the Registered Holder upon exercise hereof shall, upon their
issuance, be fully paid and non-assessable.
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6.2 NET ISSUE EXERCISE. In lieu of exercising this Warrant in the
manner provided in Section 6.1 hereof, the Registered Holder may elect to
receive shares of Common Stock equal in value to the value of this Warrant (or
the portion thereof being surrendered) by surrender of this Warrant to the
Company at its address set forth for notices in Section 12 hereof or to its
agent designated by notice given pursuant to such Section, together with notice
of such election. Upon such surrender, the Company shall issue to the Registered
Holder hereof the number of shares of Common Stock computed in accordance with
the following formula:
Y(A-B)
X = ------
A
Where:
X = The number of shares of Common Stock to be issued to the
Registered Holder;
Y = The number of shares of Common Stock for which this
Warrant is exercisable (at the date of such calculation);
A = The fair market value per share of Common Stock (at the
date of such calculation); and
B = The Exercise Price (as adjusted to the date of such
calculation).
For purposes of this Section 6.2, the fair market value per share of
Common Stock on a particular date shall mean the average of the daily Closing
Prices (as defined below) per share of Common Stock for the ten (10) consecutive
trading days commencing 15 trading days before such date, unless an Initial
Public Offering shall have been consummated on such date, in which case, the
fair market value per share of Common Stock shall be the price per share of
Common Stock offered to the public pursuant to such Initial Public Offering. If,
on any such date, shares of Common Stock are not listed or admitted for trading
on the NASDAQ National Market or any national securities exchange or quoted by
the NASDAQ System or a similar service, then the fair market value per share of
Common Stock shall mean the price per share which the Company could obtain from
a willing buyer for the shares sold by the Company from authorized but unissued
shares, as such price shall be determined in good faith by the Board of
Directors of the Company. For purposes of this paragraph only, the term "Initial
Public Offering" shall mean the sale by the Company of its equity securities
pursuant to a registration statement on Form S-1 or any successor form adopted
by the Commission.
The term "Closing Price," as used in this Section with respect to each
share of Common Stock for any day shall mean (a) the last reported sale price
for such day or in the event that no such sale takes place on such day, the
average of the closing bid and asked prices on such day, in either case, as
reported by the NASDAQ National Market or the principal national securities
exchange on which the Common Stock is listed or admitted for trading, or (b) if
the Common Stock is not listed or admitted for trading on the NASDAQ National
Market or any national securities exchange, the last reported sale price or, in
the event that no such sale takes places on such day, the average of the highest
reported bid and lowest reported asked quotation for the Common Stock, in either
case as reported on the NASDAQ System or a similar service if the NASDAQ System
is no longer reporting such information.
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7. REGISTRATION RIGHTS.
7.1 PIGGYBACK REGISTRATION. If, at any time during the five-year
period commencing on the date which is six (6) months after the Company first
becomes subject to the reporting requirements of Section 13 or Section 15(g) of
the Exchange Act (the "Registration Period"), the Company proposes to register
any of its securities under the Securities Act (other than in connection with
(a) the Company's Initial Public Offering or (b) a transaction contemplated by
Rule 145(a) promulgated under the Securities Act or any successor regulation or
pursuant to Form S-8 or S-4 (or their respective successor forms), the Company
shall give written notice of the Company's intention to do so by registered or
certified mail, at least thirty (30) days prior to the filing of each such
registration statement, to the Registered Holder(s) of Registrable Securities
(each such notice, a "Registration Notice"). Upon the written request of a
Registered Holder given within ten (10) days after receipt of a Registration
Notice that any of such Holder's Registrable Securities be included in the
proposed registration statement (a "Registration Request"), the Company shall
afford such Registered Holder the opportunity to have any such Registrable
Securities registered under such registration statement.
Notwithstanding the provisions of this Section 7.1, the
Company shall have the right at any time after giving a Registration Notice
pursuant to this Section 7.1 to the Registered Holders (irrespective of whether
a Registration Request shall have been made with respect to any Registrable
Securities) to elect not to file the proposed registration statement or to
withdraw the same after its filing but prior to the effective date thereof.
If any registration pursuant to this Section 7.1 is
underwritten in whole or in part, the Company may require that the Registrable
Securities subject to a Registration Request be included in the underwriting on
the same terms and conditions as the securities being underwritten, and then
only in such quantity as, together with all other Registrable Securities subject
to any Registration Request, will not, in the opinion of the Managing
Underwriter, jeopardize the success of the underwritten offering by the Company.
In the case of (i) a primary registration statement on behalf of the Company or
(ii) a secondary registration statement on behalf of holders of any securities
of the Company exercising a right to request or demand registration, if, in the
opinion of the Managing Underwriter, registration of the number of Registrable
Securities subject to Registration Requests would adversely affect such public
offering, then the Company shall be required to include in the underwritten
offering only that number of Registrable Securities, in addition to all other
securities to be sold by the Company or any other stockholders of the Company,
which the Managing Underwriter believes may be sold without causing such adverse
effect. The Registrable Securities, including, without limitation, the Warrant
Shares, to be so included shall be included in such registered offering in the
following order of priority: First, the securities which the Company proposes to
sell in a primary offering or the securities requested to be included therein by
securityholders exercising rights to demand registration or any unfulfilled
automatic rights to registration in the case of a secondary registration; and,
second, shares as to which there are piggyback registration rights. If less than
all shares in either group are to be registered by reason of the Managing
Underwriter's cutback, shares within such group, including, without limitation,
Warrant Shares, shall be allowed to participate in such underwriting on a pro
rata basis based upon
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the number of securities requested to be included by each participating
securityholder, and in the case of Registered Holders, pursuant to their
respective Registration Requests.
7.2 DEMAND REGISTRATION.
(a) At any time during the Registration Period, the
Majority Holders shall have the right (which right is in addition to the
registration rights granted under Section 7.1 hereof), exercisable by written
notice to the Company (each such notice, a "Demand Registration Notice"), to
require that the Company prepare and file with the Commission, on one (1)
occasion, a registration statement and such other documents, including a
prospectus, as may be necessary, in the opinion of counsel for the Company,
counsel for the underwriters, if any, and counsel, if any, for the Majority
Holders, to comply with the provisions of the Securities Act so as to permit a
public offering and sale of Registrable Securities for the period specified
hereinbelow by such Majority Holders and any other Registered Holders of
Registrable Securities who give written notice to the Company (a "Demand
Registration Response") within ten (10) days after receiving notice from the
Company (a "Registration Notice") of its receipt of such Demand Registration
Notice, provided that the Company is subject to the reporting requirements of
the Exchange Act at the time the Company receives the Demand Registration Notice
and the Demand Registration Response. Within ten (10) days after the Company's
receipt of any Demand Registration Notice from a Registered Holder, the Company
shall give a Registration Notice to all other Registered Holders with respect to
such receipt.
(b) The term "Majority Holders" shall mean Registered
Holders owning, in the aggregate, more than fifty percent (50%) of the
Registrable Securities that (i) are not held by the Company, an Affiliate,
officer, creditor, employee or agent thereof or any of their respective
Affiliates, family members, or nominees and (ii) have not been resold to the
public pursuant to a registration statement filed with the Commission under the
Securities Act or pursuant to Rule 144 promulgated thereunder; provided,
however, that the Majority Holders shall not be the Beneficial Owners of less
than an aggregate of 35,000 Registrable Securities (the "Minimum Amount"); and
provided, further, however, that in the event the piggyback registration rights
pursuant to Section 7.1 hereof have not been available for exercise within the
twelve-month period prior to the exercise of demand registration rights pursuant
to Section 7.2 hereof, the Minimum Amount shall be reduced to zero.
(c) Anything contained herein to the contrary
notwithstanding, the Majority Holders shall not have the right to demand
registration as provided in this Section 7.2 if, within the preceding six-month
period, the Registered Holders had the opportunity, whether or not exercised, to
register any Registrable Securities pursuant to Section 7.1 hereof or Section
4.1 of the Agreement.
(d) The right to demand registration set forth in this
Section 7.2 shall not be in addition to any rights to demand registration
pursuant to any Note or the Agreement.
7.3 COVENANTS OF THE COMPANY WITH RESPECT TO REGISTRATION. In
connection with any registration under Section 7.1 or 7.2 hereof, the Company
covenants and agrees as follows:
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(a) to use commercially reasonable efforts to file a
registration statement within forty-five (45) days of the Company's receipt of a
Registration Request or a Demand Registration Notice, which request or demand
triggers the Company's obligation to register Registrable Securities of any
Registered Holders pursuant to Section 7.1 or 7.2 hereof, and to cause any
registration statement to be declared effective at the earliest time
practicable. The Company shall furnish each Registered Holder that has given a
Registration Request, a Demand Registration Notice or a Notice of Participation
such number of prospectuses as shall reasonably be requested;
(b) to pay all costs (excluding transfer taxes, if any, and
any capital gains or other income taxes whatsoever, including, without
limitation, any withholding taxes, that may be imposed upon any holder of this
Warrant and any underwriting or selling commissions), fees and expenses in
connection with all registration statements filed pursuant to Section 7.1 or 7.2
hereof including, without limitation, the Company's legal and accounting fees,
printing expenses and blue sky fees and expenses;
(c) as expeditiously as possible, to prepare and file with the
Commission any amendments and supplements to the registration statement and the
prospectus included in the registration statement as may be necessary to keep
the registration statement effective, in the case of a firm commitment
underwritten public offering, until each underwriter has completed the
distribution of all securities purchased by it and, in the case of any other
offering, until the earlier of the sale of all Registrable Shares covered
thereby or two hundred seventy (270) days after the effective date thereof;
(d) as expeditiously as possible, to furnish to each Seller
such reasonable number of copies of the prospectus, including a preliminary
prospectus, and such other documents as such Seller may reasonably request in
order to facilitate the public sale or other disposition of the Warrant Shares
owned by him pursuant to Section 7.1 or 7.2 hereof;
(e) as expeditiously as possible, to use its commercially
reasonable efforts to register or qualify a Seller's Registrable Securities
covered by the registration statement under the securities or blue sky laws of
such states as each Seller reasonably requests, and do any and all other acts
and things that may be necessary or desirable to enable each Seller to
consummate the public sale or other disposition in such states of its
Registrable Securities; provided, however, that the Company shall not be
required in connection with this paragraph (e) to qualify as a foreign
corporation in any jurisdiction in which it is not already obligated to qualify
or execute or file a general consent to service of process in any jurisdiction
or subject itself to the laws of any jurisdiction other than the United States
or any state thereof;
(f) if the registration statement relates to an underwritten
offering, to enter into and perform its obligations under an underwriting
agreement in the usual and customary form, including, without limitation,
customary indemnification and contribution obligations;
(g) to notify each Seller at any time when a prospectus
relating to its Registrable Securities covered by the registration statement is
effective, of the happening of any event as a result of which the prospectus
included in the registration statement, as then in effect, includes an untrue
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<PAGE> 81
statement of a material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein not misleading in
light of the circumstances then existing. The Company shall use commercially
reasonable efforts promptly to amend or supplement the registration statement to
correct any such untrue statement or omission;
(h) to notify each Seller of the issuance by the Commission or
any state securities commission of any stop order suspending the effectiveness
of the registration statement or the initiation of any proceedings for that
purpose. The Company will make every commercially reasonable effort to prevent
the issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible time;
(i) if, after the Company has delivered preliminary or final
prospectuses to a Seller, the prospectus is amended to comply with the
provisions of the Securities Act or is otherwise amended or supplemented, the
Company shall promptly notify each Seller. In the event of such notification,
each Seller shall immediately cease making offers of the Registrable Securities
and, if requested, shall return all prospectuses to the Company. The Company
shall promptly provide each Seller with revised prospectuses and, following
receipt of the revised prospectuses, each Seller shall be free to resume making
offers of Registrable Securities, subject only to applicable laws and the terms
of any stop order of the Commission or any state securities commission.
(j) to permit a single law firm, if any, designated by the
Majority Holders as counsel to the Registered Holders to review the registration
statement and all amendments and supplements thereto within a reasonable period
of time prior to the filing thereof, and shall not file any document in a form
to which such counsel reasonably objects; and
(k) to make available for inspection by the Registered
Holders, and any representative of all Registered Holders, any underwriter
participating in any disposition pursuant to a registration statement, and any
attorney or accountant retained by any Registered Holder or underwriter, all
financial and other records customary for purposes of a due diligence
examination of the Company by the Registered Holders or such underwriters, as
the case may be, pertinent corporate documents and properties of the Company,
and to cause the Company's officers, directors and employees to supply all
information reasonably requested by any such Registered Holder, representative,
underwriter, attorney or accountant in connection with such registration
statement, provided that such parties agree to keep all such records, documents,
properties and information confidential.
7.4 INDEMNIFICATION BY THE COMPANY.
(a) In the event that the Company registers any of the
Registrable Securities under the Securities Act, the Company shall indemnify and
hold harmless each participating Seller and each underwriter of such Registrable
Securities so registered (including any broker or dealer through whom such
Registrable Securities may be sold pursuant to the applicable underwriting
agreement, and the officers, directors, Affiliates and each Controlling Person,
if any, of such Seller or any such underwriter) from and against (i) any and all
losses, claims, damages, expenses or liabilities, joint or several, as incurred,
to which they or any of them becomes subject under the Securities Act,
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applicable state securities laws or under any other statute or at common law or
otherwise, and (ii) except as hereinafter provided, will reimburse each such
Seller, underwriter and Controlling Person, if any, for any legal or other
expenses such Seller, underwriter and Controlling Person, respectively,
reasonably incurred in connection with investigating or defending any actions
whether or not resulting in any liability, as incurred, but only insofar as such
losses, claims, damages, expenses, liabilities or actions set forth in the
preceding clauses (i) and (ii) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the
registration statement, in any preliminary or amended preliminary prospectus or
in the final prospectus (or the registration statement or prospectus as from
time to time amended or supplemented by the Company) in any application or other
document executed by the Company or based upon information furnished and filed
by the Company in any jurisdiction in order to qualify the securities under the
securities laws thereof or filed with the Commission, the NASD, the Nasdaq Stock
Market or any securities exchange, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary in order to make the statements therein not
misleading, or any violation by the Company of any rule or regulation
promulgated under the Securities Act or any state securities laws applicable to
the Company and relating to action or inaction of the Company in connection with
such registration, (i) unless such untrue statement or alleged untrue statement
or omission or alleged omission was made in such registration statement,
preliminary or amended preliminary prospectus or final prospectus or
application, document or filing in reliance upon and in conformity with
information furnished in writing to the Company in connection therewith by a
Seller or any of its Controlling Persons (in the case of indemnification of such
Seller or any of its Controlling Persons), or any such underwriter or its
Controlling Persons, if any (in the case of indemnification of such underwriter
or its Controlling Persons), expressly for use therein, or (ii) unless, in the
case of a sale directly by such Seller (including a sale of such Registrable
Securities through any underwriter retained by such Seller to engage in a
distribution on its behalf), such untrue statement or alleged untrue statement
or omission or alleged omission was contained in a preliminary prospectus and
corrected in a final or amended prospectus copies of which were delivered to
such Seller or such underwriter on a timely basis, and such Seller or
underwriter failed to deliver a copy of the final or amended prospectus at or
prior to the confirmation of the sale of the Warrant Shares and/or other
Registrable Securities to the Person asserting any such loss, claim, damage or
liability in any case where such delivery is required by the Securities Act.
(b) Promptly after receipt by any Seller, underwriter or any
of their Controlling Persons of notice of the commencement of any action in
respect of which indemnity may be sought against the Company, such Seller,
underwriter or Controlling Person, as the case may be, shall notify the Company
in writing of the commencement thereof (provided, that failure to so notify the
Company shall not relieve the Company from any liability it may have hereunder
except to the extent that the Company's defense of such action is materially and
adversely affected thereby), and, subject to the provisions hereinafter stated,
the Company shall be entitled to assume the defense of such action (including
the employment of counsel, who shall be counsel reasonably satisfactory to such
Seller, underwriter or Controlling Person, as the case may be), and shall assume
the payment of expenses insofar as such action relates to any alleged liability
in respect of which indemnity may be sought against the Company hereunder.
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(c) Such Seller or any such underwriter and their respective
Controlling Persons shall have the right to employ separate counsel in any such
action and to participate in the defense thereof but the fees and expenses of
such counsel subsequent to any assumption of the defense by the Company shall
not be payable by the Company unless (i) engagement of such counsel has been
specifically authorized in writing by the Company, or (ii) the Company shall not
have engaged counsel to defend such action by the earlier of (a) 45 days after
the Company shall have received notice of such action and (b) the date by which
any filing must be made with the court or other administrative body adjudicating
any such action or any other action must be taken in order not to relinquish any
rights applicable to such Seller or any of its Controlling Persons, or (iii)
such indemnified party or parties shall have reasonably concluded that there may
be defenses available to it or them which are different from or additional to
those available to the Company (in which case the Company shall not have the
right to direct the defense of such action on behalf of the indemnified party or
parties) in either such event, the fees and expenses of not more than one
additional firm of attorneys for the Seller(s), such underwriter and/or their
Controlling Persons shall be borne by the Company. The Company shall not be
liable to indemnify any Person for any settlement of any such action effected
without the Company's written consent. The Company shall not, except with the
approval of each party being indemnified under this Section 7.4, consent to the
entry of any judgment or enter into any settlement of any action, suit or other
proceeding which does not include as an unconditional term thereof the giving by
the claimants or plaintiffs to the parties being so indemnified of a release
from all liability in respect of all claims made in such action, suit or
proceeding.
(d) In order to provide for just and equitable contribution to joint
liability under the Securities Act in any case in which a Seller or any
Controlling Person of a Seller makes a claim for indemnification pursuant to
this Section 7.4 but it is judicially determined (by the entry of a final
judgment or decree by a court of competent jurisdiction and the expiration of
time to appeal or the denial of the last right of appeal) that such
indemnification may not be enforced in such case notwithstanding the fact that
this Section 7.4 provides for indemnification in such case, then each of the
Company, such Seller and such Controlling Person shall contribute to the
aggregate losses, claims, damages or liabilities to which it may be subject
(after contribution from others) in such proportion as is appropriate to reflect
the relative fault of the Company on the one hand and that of such Seller and
each of its Controlling Persons on the other, in connection with the statements
or omissions which resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative fault of the
Company on the one hand and of the Seller and/or its Controlling Persons on the
other hand shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the Company
on the one hand or by such Seller and/or its Controlling Persons on the other,
and the relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission of each of the Company, on the one
hand, and the Seller and/or its Controlling Persons, on the other hand;
provided, however, that, in any such case, (i) no such Seller will be required
to contribute any amount in excess of the public offering price of all such
Registrable Securities offered by such Seller pursuant to such registration
statement; and (ii) no Person or entity guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
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contribution from any Person that was not guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act).
7.5 LISTING; EXCHANGE ACT REGISTRATION. (a) If, at any time, the
Company lists any class of its equity securities on any national securities
exchange and registers such class of securities under the Exchange Act, the
Company shall, at its expense: (i) include in its application for such listing
the Registrable Securities and maintain such listing of, such class of equity
securities; and (ii) use commercially reasonable efforts to timely file with the
Commission such information as the Commission may require under Section 13 or
Section 15(d) of the Exchange Act; and (iii) provided the Registration Period
shall have commenced, use commercially reasonable efforts (a) to list
Registrable Securities on such national securities exchange simultaneously with
the registration thereof, if any, and (b) to take all action as may be required
as a condition to the availability of Rule 144 or Rule 144A under the Securities
Act (or any successor exemptive rule hereafter in effect) with respect to such
Registrable Securities.
(b) If the Company lists any class of equity securities on any
national securities exchange and registers such class of equity securities under
the Exchange Act, the Company shall furnish to any Seller, forthwith upon such
Seller's request, (i) a written statement by the Company as to its compliance
with the reporting requirements of Rule 144, (ii) a copy of the most recent
annual or quarterly report of the Company as filed with the Commission, and
(iii) such other reports and documents as such Seller may reasonably request in
availing itself of any rule or regulation of the Commission allowing such Seller
to sell any such Registrable Securities without registration. The Company agrees
to use its commercially reasonable efforts to facilitate and expedite transfers
of Registrable Securities pursuant to Rule 144 under the Securities Act, which
efforts shall include timely notice to its transfer agent to expedite such
transfers.
7.6 SELLER INDEMNIFICATION.
(a) In the event that the Company registers any of the
Registrable Securities under the Securities Act, each Seller shall indemnify and
hold harmless the Company, each of its directors and each of its officers who
have signed or otherwise participated in the preparation of the registration
statement, each of the Company's Controlling Persons, each underwriter of the
Registrable Securities so registered (including any broker or dealer through
whom such of the shares may be sold) and each of such underwriter's Controlling
Persons, from and against any and all losses, claims, damages, expenses or
liabilities, joint or several, as incurred, to which they or any of them may
become subject under the Securities Act, applicable state securities laws or
under any other statute or at common law or otherwise, and, except as
hereinafter provided, shall reimburse the Company and each such director,
officer, underwriter, broker, dealer or Controlling Person for any legal or
other expenses it reasonably incurs in connection with investigating or
defending any action, suit or proceeding whether or not resulting in any
liability, insofar as such losses, claims, damages, expenses, liabilities or
actions arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the registration statement, in any
preliminary or amended preliminary prospectus or in the final prospectus (or in
the registration statement or prospectus as from time to time amended or
supplemented) or arise out of or are based upon the omission or alleged omission
to state therein a material fact required to be stated therein or necessary in
order
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to make the statements therein not misleading, but only insofar as any such
statement or omission was made in reliance upon and in conformity with
information furnished in writing to the Company in connection therewith by such
Seller or Controlling Person of such Seller expressly for use therein; provided,
however, that such Seller's obligations hereunder shall be limited to an amount
equal to the proceeds received by such Seller from the sale of Registrable
Securities pursuant to such registration statement or prospectus.
(b) Promptly after the Company's receipt of notice of the
commencement of any action, suit or proceeding in respect of which indemnity may
be sought against such Seller, the Company shall notify such Seller in writing
of the commencement thereof (provided, that failure to so notify such Seller
shall not relieve such Seller from any liability it may have hereunder except to
the extent that such Seller's defense of such action is materially and adversely
affected thereby), and such Seller shall, subject to the provisions hereinafter
stated, be entitled to assume the defense of such action (including the
employment of counsel, who shall be counsel reasonably satisfactory to the
Company) and shall assume the payment of all expenses insofar as such action,
suit or proceeding shall relate to the alleged liability in respect of which
indemnity may be sought against such Seller hereunder.
(c) The Company and each such director, officer, underwriter
or Controlling Person shall have the right to employ separate counsel in any
such action and to participate in the defense thereof, but the fees and expenses
of such counsel subsequent to any assumption of the defense by such Seller shall
not be at the expense of such Seller unless (i) engagement of such counsel is
specifically authorized in writing by such Seller or (ii) such Seller shall not
have engaged counsel to defend such action by the earlier of (a) 45 days after
the Company shall have given notice to such Seller of such action and (b) the
date by which any filing must be made with the court or administrative body
adjudicating any such action or any other action must be taken in order not to
relinquish any legal rights applicable to the Company or any of its Controlling
Persons, or (iii) such indemnified party or parties shall have reasonably
concluded that there may be defenses available to it which are different from or
additional to those available to such Seller (in which case such Seller shall
not have the right to direct the defense of such action on behalf of the
indemnified party or parties), in either such event, the fees and expenses of
not more than one additional firm of attorneys for each of the Company and/or
such underwriter shall be borne by such Seller. Such Seller shall not be liable
to indemnify any Person for any settlement of any such action effected without
such Seller's written consent.
(d) In order to provide for just and equitable contribution to joint
liability under the Securities Act in any case in which the Company's exercise
of its rights under this Section 7.6 involves a claim for indemnification
pursuant to this Section 7.6, but it is judicially determined (by the entry of a
final judgment or decree by a court of competent jurisdiction and the expiration
of time to appeal or the denial of the last right of appeal) that such
indemnification may not be enforced in such case notwithstanding that this
Section 7.6 provides for indemnification, then, in such case, the Company and
such Seller shall contribute to the aggregate losses, claims, damages or
liabilities to which they may be subject (after contribution from others) in
such proportion as is appropriate to reflect the relative fault of the Company
on the one hand and of such Seller on the other hand in connection with the
statements or omissions which resulted in such losses, claims, damages or
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liabilities, as well as any other relevant equitable considerations. The
relative fault of the Company on the one hand and of such Seller on the other
hand shall be determined by reference to, among other things, whether the untrue
or alleged untrue statement of a material fact or omission or alleged omission
to state a material fact relates to information supplied by the Company on the
one hand or by such Seller on the other, and their relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission; provided, however, that, in any such case, (i) no such Seller shall be
required to contribute any amount in excess of the public offering price of all
such Registrable Securities offered by it pursuant to such registration
statement; and (ii) no Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) will be entitled to contribution
from any Person that was not guilty of such fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act).
7.7 UNDERWRITER COMPENSATION. In connection with any registration made
pursuant to Section 7.1 or 7.2 hereof, the Registered Holders of Warrant Shares
agree as follows: (i) any public sale of Registrable Securities included in such
registration statement shall be effected through the underwriter, if any, for
such registration and (ii) Sellers shall compensate the underwriter in
accordance with the underwriter's customary compensation practices for such
transactions.
7.8 STOCKHOLDER ACTS. Whenever under the preceding provisions of this
Section 7 a Registered Holder is registering any Warrant Shares pursuant to any
registration statement, such Holder agrees to timely provide to the Company such
information and materials as the Company may reasonably request in order to
effect the registration of such Warrant Shares.
7.9 NO REQUIRED EXERCISE. Nothing contained in this Warrant shall be
construed as requiring the holder to exercise the Warrant prior to the initial
filing of any registration statement or the effectiveness thereof.
7.10 ASSIGNMENT OF REGISTRATION RIGHTS. The rights to cause the Company
to register Registrable Securities pursuant to this Section 7 may be assigned
(but only with all related obligations) by the Registered Holder to a Permitted
Transferee, provided that: (a) within a reasonable time before such transfer,
which time shall not be less than ten (10) days, the Company is furnished with
written notice of the name and address of such proposed transferee and the
number of Registrable Securities with respect to which such registration rights
are being assigned; (b) immediately following such transfer, further disposition
of such Registrable Securities by the proposed transferee is restricted under
the Securities Act; (c) in the Company's judgment, the proposed transferee is
not a competitor of the Company or any of its subsidiaries; (d) such transfer
is not otherwise prohibited by the terms of any applicable law or regulation or
any lock-up agreement, if any (including, without limitation, the Lock-Up
Agreement), then in effect with respect to the Securities or the Registrable
Securities; (e) the Company receives an opinion of counsel, acceptable to the
Company in its sole discretion, that such assignment does not violate the
Securities Act or any applicable state securities laws or regulations; and (f)
the proposed transferee agrees to execute and deliver to the Company an original
counterpart signature page to the Agreement, thereby agreeing to be bound by the
terms thereof.
16
<PAGE> 87
7.11 DELAY OF REGISTRATION. No holder hereof shall have any right to
obtain or seek an injunction restraining or otherwise delaying any registration
as the result of any controversy that might arise with respect to the
interpretation or implementation of this Article 7.
8. CERTIFICATE OF ADJUSTMENT. Whenever the Exercise Price or number or type of
securities issuable upon exercise of this Warrant is adjusted as herein
provided, the Company shall promptly deliver to the Registered Holder of this
Warrant a certificate of an officer of the Company setting forth the nature of
such adjustment and a brief statement of the facts requiring such adjustment.
9. TRANSFER OF WARRANT. This Warrant may not be transferred by the holder
without the written consent of the Company. Notwithstanding the foregoing, no
such consent shall be necessary for a transfer by the Purchaser to a stockholder
or partner of the Purchaser, if the transferee or transferees agree in writing
to be subject to the terms hereof to the same extent as if they were the
Purchaser hereunder and executes a counterpart signature page and agrees to be
bound by, the Agreement.
10. REPLACEMENT OF WARRANTS. On receipt of evidence reasonably satisfactory to
the Company of the loss, theft or mutilation of any Warrant and delivery of an
indemnification agreement or security reasonably satisfactory in form and amount
to the Company or, in the case of any such mutilation, on surrender and
cancellation of such Warrant, the Company shall execute and deliver, at its
expense, in lieu hereof, a new Warrant of like tenor.
11. SECURITIES LAWS. As a condition to the exercise of this Warrant, the
Registered Holder (including any permitted assignee) shall be required to make
such representations and warranties and execute such documents as reasonably
requested by the Company in order for the Company to perfect an exemption from
the registration and qualification requirements of applicable securities laws.
12. NOTICES. Except as otherwise specifically provided herein, all notices and
other communications required or permitted to be given hereunder shall be in
writing and shall be deemed to be received when delivered personally or sent by
facsimile with written confirmation of complete transmission, one day after
being sent by overnight courier service or express mail requiring signed
acknowledgment of delivery, or five (5) business days after mailing by
registered or certified mail, return receipt requested with all postage and
certified or registration fees prepaid, in each case if addressed to the party
for whom intended at the address for such party set forth below or to such other
address as such party may designate by notice given in accordance with the
provisions of this Section 12:
to the Company: Dynacs Inc.
35111 U.S. Highway 19 North
Suite 300
Palm Harbor, Florida 34684
Attn.: Dr. Ramendra P. Singh, President
17
<PAGE> 88
with copies to: Frankfurt Garbus Klein & Selz, P.C.
488 Madison Avenue
New York, New York 10022
Attn.: Gary A. Schonwald, Esq.
to the Purchaser: To each Registered Holder at the address set forth on
Schedule I to the Agreement.
with copies to: H.C. Wainwright & Co., Inc.
One Boston Place
40th Floor
Boston, MA 02108
Attn.: Matthew La Fontaine, Associate
13. TERMINATION. The right to purchase securities upon exercise of this Warrant
shall terminate upon the earlier of (a) the fifth anniversary of the Issuance
Date and (b) the fourth anniversary of the first Liquidity Event.
14. MISCELLANEOUS. This Warrant has been prepared, negotiated and delivered in
the State of New York and shall be governed by the laws of said State. The
headings in this Warrant are for purposes of convenience and reference only, and
shall not be deemed to constitute a part hereof. Neither this Warrant nor any
term hereof may be changed, waived, discharged or terminated orally but only by
an instrument in writing signed by the Company and the Registered Holder hereof.
All notices and other communications from the Company to the Registered Holder
shall be mailed by first class registered or certified mail, postage prepaid, to
the address furnished to the Company in writing by the Registered Holder. The
invalidity or unenforceability of any provision hereof shall in no way affect
the validity or enforceability of any other provisions. The language in this
Warrant shall be construed as to its fair meaning, and not strictly for or
against the Company or the Holder. This Warrant, together with the Agreement and
the Second Senior Subordinated Convertible Note issued by the Company to the
Purchaser on the date hereof, sets forth the final, complete and exclusive
statement of the terms and conditions between the parties pertaining to the
subject matter of this Warrant and supersedes all prior and contemporaneous
agreements or understandings, whether written or oral, with respect hereto.
ISSUED as of this _____ day of February, 2000 to ________ (the
"Purchaser").
DYNACS INC.
By
_________________________________
Harry Schubele, III
Senior Vice President
18
<PAGE> 89
Dynacs Inc.
35111 U.S. Highway 19 North, Suite 300
Palm Harbor, Florida 34684
ELECTION TO EXERCISE
The undersigned hereby exercises his or its rights to purchase _________ Warrant
Shares covered by the within Warrant and tenders payment herewith in the amount
of $_______ in accordance with the terms thereof; and requests that certificates
for such securities be issued in the name of, and delivered to:
___________________________________________________
___________________________________________________
___________________________________________________
(Print Name, Address and Social Security or Tax Identification Number)
and, if such number of Warrant Shares are not all the Warrant Shares covered by
the within Warrant, that a new Warrant for the balance of the Warrant Shares
covered by the within Warrant be registered in the name of, and delivered to,
the undersigned at the address stated below.
___________________________________________________
___________________________________________________
___________________________________________________
(Print Name, Address and Social Security or Tax Identification Number)
Dated: __________________ Name: ______________________________________
(Print)
Address: _________________________________________________
______________________________________
(Signature)
______________________________________
(Signature Guarantee)
______________________________________
(Signature Guarantee)
19
<PAGE> 90
EXHIBIT C
FORM OF OPINION OF COUNSEL
<PAGE> 91
Frankfurt Garbus Klein & Selz, PC
488 Madison Avenue
New York, New York 10022
Tel: (212) 980-0120
Fax: (212) 593-9175
________________, 2000
To the Investors listed
on Schedule I to the Warrant and
Senior Sub. Con. Note Pur. Agmt.
dated the date hereof
H.C. Wainwright & Co., Inc.
One Boston Place, 40th Floor
Boston, MA 02108
Re: Dynacs, Inc.
Ladies and Gentlemen:
We have acted as special counsel for Dynacs, Inc., a Delaware
corporation (the "Company"), in connection with its offer and sale (the
"Offering") of up to $1,900,000 in principal amount of one-year Second Senior
Subordinated Convertible Promissory Notes (the "Notes") and warrants to purchase
up to 285,000 shares of the Company's common stock, par value $.01 per share,
(the "Warrants") pursuant to a private placement conducted by H.C. Wainwright &
Co., Inc. acting as placement agent (the "Placement Agent") as more fully
described in the Confidential Offering Memorandum, dated February 8, 2000, which
includes a term sheet, the forms of (i) the Second Warrant and Senior
Subordinated Convertible Note Purchase Agreement, by and among the Company and
the purchasers of Notes and Warrants named on Schedule I thereto (collectively,
the "Investors"), (ii) the Warrants and (iii) the Notes, and certain information
with respect to the Company, its subsidiaries and their business and operations
(the "Offering Memorandum"). The Second Warrant and Senior Subordinated
Convertible Note Purchase Agreement is referred to herein as the "Agreement."
The transactions contemplated by the Offering Memorandum and the Agreement are
collectively referred to herein as the "Transactions."
This opinion is furnished to you on behalf of the Company pursuant to
Section 5.2(d) of the Agreement. Capitalized terms used herein which are not
otherwise defined shall have the respective meanings ascribed to them in the
Agreement.
<PAGE> 92
Investors and 2
H.C. Wainwright & Co., Inc.
, 2000
In such capacity, we have examined the following documents and
agreements as executed by the Company in connection with the Transactions:
(i) the Agreement;
(ii) the Warrants, each dated the date hereof;
(iii) the Notes, each dated the date hereof;
(iv) the Subordination Acknowledgment and Agreements between the
Company and each of the unsecured debt holders listed on
Schedule I to this opinion (the "Subordination Agreements");
(v) the Waiver of Preemptive Rights, dated November 1, 1999,
executed by the representative of the holders of outstanding
common stock of the Company's subsidiary, Cerulean FXs, Inc.
("Cerulean"), a copy of which waiver (the "Cerulean Waiver") is
attached to this Opinion; and
(vi) the Offering Memorandum.
We have also reviewed the Individual Guaranty, dated the date hereof, of
Ramendra P. Singh (the "Guarantor") in favor of the Investors (the "Guaranty").
The documents, instruments and agreements set forth in clauses (i) through (v)
immediately above are referred to in this opinion letter collectively as the
"Transaction Documents."
In addition, we have examined and relied upon such other documents,
instruments and records as we have deemed necessary for purposes of rendering
this opinion. Such documents, instruments and records, together with the
Transaction Documents and the Guaranty, are referred to in this opinion letter
collectively, as the "Reviewed Documents."
Insofar as the opinions expressed herein relate to factual matters,
information with respect to which is in the possession of the Company, we have
relied, with your permission, upon a certificate of Ramendra P. Singh, President
and Chief Executive Officer of the Company, annexed hereto, and upon statements
and representations of other officers and other representatives of the Company
and upon the Company's duly authorized representatives' and officers'
representations and warranties contained in the Reviewed Documents. No facts or
circumstances have come to our attention (but without our having made any
investigations for such purpose) that would cause us to believe that any such
representations, warranties or statements which are relevant to the opinions
expressed in this opinion letter and upon which we are relying in rendering this
opinion are inaccurate in any material respect.
<PAGE> 93
Investors and 3
H.C. Wainwright & Co., Inc.
, 2000
The opinion contained in paragraph 8 below is furnished to you on
behalf of the Guarantor solely in connection with his execution and delivery of
the Guaranty. In such capacity, we have examined the Guaranty as executed by the
Guarantor.
We are members of the Bar of the State of New York and we do not
purport to be experts in, and we do not express any opinion herein concerning,
any laws other than the laws of the State of New York, the General Corporation
Law of the State of Delaware, and the federal laws of the United States of
America, as currently in effect. In addition, our opinion is limited to the
matters expressly set forth herein, and no opinion is implied or may be inferred
beyond such matters. No opinion is rendered herein with respect to the effect or
enforceability of any conflicts of laws provisions of the Agreement, any other
Transaction Document or the Guaranty, and we express no opinion as to any
representation or warranty of any party other than the Company. We inform you
that we have not heretofore represented the Guarantor.
Based upon such review and examinations, and upon the assumptions,
qualifications and exceptions set forth in this opinion letter, we are of the
opinion that:
1. The execution, delivery and performance of the Agreement have been
duly and validly authorized by the Company, the Agreement and the Subordination
Agreements are each the valid and binding obligation of the Company enforceable
against the Company in accordance with its terms, and the Notes and the Warrants
constitute valid and binding obligations of the Company enforceable against the
Company in accordance with their respective terms. The Warrants, the Notes, the
Warrant Shares and the Note Shares have been duly authorized for issuance, and
assuming payment therefor by the Investors in accordance with the terms of the
Transaction Documents, (i) the Warrants issued to the Investors are validly
issued, fully paid and non-assessable and the holders thereof are not subject to
personal liability to third parties solely by reason of being such holders, (ii)
the Notes issued to the Investors are duly authorized and validly issued, and
(iii) the Warrant Shares and the Note Shares, if and when issued, will be
validly issued, fully paid and non-assessable and the holders thereof will not
be subject to personal liability to third parties solely by reason of being such
holders. All corporate action required to be taken for the authorization,
issuance and sale of the Warrants and the Notes and the authorization, issuance
and sale of the Warrant Shares and the Note Shares in accordance with the terms
of the Transaction Documents have been duly and validly taken by the Company.
The Notes, the Warrants, the Warrant Shares, and the Note Shares are not subject
to any preemptive rights, created by statute, of any security holder of the
Company, and, to our knowledge, such securities are not subject to contractual
preemptive rights of any other party, except the preemptive rights of the
holders of shares of common stock of Cerulean, pursuant to
<PAGE> 94
Investors and 4
H.C. Wainwright & Co., Inc.
, 2000
that certain Exchange Agreement, dated as of August 13, 1999, by and among the
Company, Ramendra P. Singh, Michael Burns, William Dallas, Jon Feltheimer and
Offense Group Associates, LP (the "Exchange Agreement"), which preemptive rights
(the "Cerulean Holders' Rights"), have been waived pursuant to Cerulean Waiver.
2. The Company has been duly organized as a corporation under the laws
of the State of Delaware and is in good standing in such State. The Company is
duly qualified to do business as a foreign corporation and is in good standing
in each state of the United States in which the failure to so qualify or be in
good standing would have a material adverse effect on the business of the
Company and its subsidiaries, taken as a whole. The Company has all requisite
corporate power and corporate authority to own or lease its properties and
assets and to conduct its business as currently conducted.
3. All of the outstanding capital stock of the Company has been duly
authorized, validly issued and, to our knowledge, is fully paid and
non-assessable. To our knowledge, the holders of the outstanding capital stock
of the Company have no contractual rights of rescission or contractual
preemptive rights with respect to their shares, other than the Cerulean Holders'
Rights, and none of such securities was issued in violation of the contractual
preemptive rights of any holder of any security of the Company. The holders of
the outstanding capital stock of the Company are not subject to statutory
personal liability solely by reason of being such holders and none of such
outstanding capital stock was issued in violation of the statutory preemptive
rights of any holder of any security of the Company.
4. To our knowledge, neither the Company nor any domestic Subsidiary is
in breach of, or in default under, any term or provision of any indenture,
mortgage, deed of trust, lease, note, loan or credit agreement or any other
agreement or instrument evidencing an obligation for borrowed money, or any
other agreement or instrument to which it is a party or by which it or any of
its properties may be bound or affected. To our knowledge, neither the Company
nor any domestic Subsidiary is in violation of any provision of its articles or
certificate of incorporation or by-laws or in violation of any franchise,
license, permit, judgment, decree or order, or in violation of any state or
Federal statute, rule or regulation except as disclosed in the Agreement. To our
knowledge, neither the execution and delivery of the Agreement, nor the issuance
and sale or delivery of the Securities nor the consummation of any of the
transactions contemplated in the Agreement, nor the compliance by the Company
with the terms and provisions thereof, has conflicted with, or has resulted in a
breach of, any of the terms and provisions of, or has constituted a default
under, or has resulted in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its domestic
Subsidiaries or
<PAGE> 95
Investors and 5
H.C. Wainwright & Co., Inc.
, 2000
pursuant to the terms of any indenture, mortgage, deed of trust, note, loan or
credit agreement or any other agreement or instrument evidencing an obligation
for borrowed money, or any other agreement or instrument to which the Company or
any Subsidiary may be bound or to which any of the property or assets of the
Company is subject. The execution, delivery and performance by the Company of
each of the Transaction Documents and the consummation by the Company of the
Transactions do not (a) contravene the Company's certificate of incorporation or
by-laws or (b) to our knowledge, violate any law, statute, rule, regulation
order, writ, judgment, injunction, decree, determination or award, the violation
or breach of which could reasonably be expected to have a material adverse
effect on the business of the Company and its subsidiaries, taken as a whole.
5. To the best of our knowledge, no authorization, approval or other
action by, and no notice to or filing with, any governmental authority or
regulatory body is required for the due execution, delivery and performance by
the Company of any of the Transaction Documents.
6. To the best of our knowledge, there are no claims, actions, suits,
investigations or proceedings before or by any arbitrator, court, governmental
authority or instrumentality pending or threatened against or affecting the
Company or involving the properties of the Company, other than the Arbitration
Proceedings, which might materially and adversely affect the business,
properties, or financial condition of the Company and its subsidiaries, taken as
a whole.
7. We have participated in the preparation of the Offering Memorandum
and the Transaction Documents (collectively, the "Offering Documents"),
including, without limitation, participation in conferences with officers and
other representations and have reviewed the Reviewed Documents, and although we
do not pass upon and do not assume responsibility for the accuracy, completeness
or fairness of the statements contained in the Offering Documents, nothing has
come to our attention to cause us to have reason to believe that any of the
Offering Documents contains any untrue statement of a material fact required to
be stated therein or omits to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, provided, however,
that we are not expressing any opinion with respect to (i) the financial
schedules, financial statements, notes thereto and other financial information
and statistical data contained therein, including, without limitation, the
summary financial information and any financial forecasts or projections.
8. The Guaranty constitutes the legal, valid and binding obligation of
the Guarantor enforceable against the Guarantor in accordance with its terms.
<PAGE> 96
Investors and 6
H.C. Wainwright & Co., Inc.
, 2000
9. Assuming (i) that each Investor that purchases Notes and Warrants is
an Accredited Investor, (ii) that the representations made by the Company and
the Investors in the Agreement and in the Investors' Investor Questionnaires
were true and correct on the date of such Agreement and at the time of the
Closing, (iii) that a Form D will be filed in accordance with the provisions of
Section 503 of Regulation D, (iv) that H.C. Wainwright and any other parties
acting at the request of H.C. Wainwright as a co-placement agent complies with
the requirements of Sections 4(2), Regulation D or 4(6) of the Securities Act of
1933, as amended, no registration under the Securities Act is required in
connection with the sale and issuance of any of the securities. The offering and
sale of the Securities in the manner contemplated by the Agreement will not be
integrated with any offering made before the offer and sale of such securities
in a manner that would render unavailable any exemption from registration under
the Securities Act.
In our examination of the Reviewed Documents, we have assumed the
following:
(a) the signatures of all parties (other than the Company) contained in
such Reviewed Documents are genuine signatures of the parties purporting to have
signed the same, and all persons signing such Reviewed Documents had, at the
time of such signing, full legal capacity to sign and deliver such Reviewed
Documents;
(b) the legal capacity of each signatory (other than the Company) to
such Reviewed Documents;
(c) the authenticity and accuracy of all documents submitted to us as
originals and the conformity to original documents of all Reviewed Documents
submitted to us as originals and the conformity to original documents of all
Reviewed Documents submitted to us as certified or photostatic copies;
(d) the Transaction Documents are the valid and legally binding
obligations of each party thereto other than the Company and are enforceable
against each such party other than the Company in accordance with their
respective terms.
(e) no action has been taken which amends, revokes or otherwise affects
any of the Reviewed Documents;
(f) the Transaction Documents and the Guaranty accurately describe and
contain the full understanding of all parties thereto, including the Company,
and there are no oral or written
<PAGE> 97
Investors and 7
H.C. Wainwright & Co., Inc.
, 2000
statements or agreements by any party that modify, amend, vary or waive, or
purport to modify, amend, vary or waive, any of the terms of any Transaction
Document; and
(g) the facts and law governing the future performance by the Company
of its obligations under the Transaction Documents will be identical to the
facts and law governing the Company's performance of the Transaction Documents
on the date of this opinion letter.
Although we have not conducted an independent investigation of the accuracy or
reasonableness of any of these assumptions, nothing has come to our attention
leading us to question the accuracy of any of the above assumptions.
Any reference to any of the terms, "our knowledge," "knowledge," or
"our best knowledge," or to any matters "known to us," "coming to our attention"
or "of which we are aware," or any variation of any of the foregoing shall mean
the conscious awareness, as to the existence or absence of any facts which would
contradict any assumption or opinion set forth in this opinion letter, of those
attorneys of this firm who have rendered substantive attention to the Company or
any of its Subsidiaries or the Guarantor in connection with the Offering. Except
as specifically set forth in this opinion letter, we have not undertaken any
independent investigation to determine the existence or absence of such facts,
and no inference as to our knowledge of the existence or absence of such facts
should be drawn from the fact of our representation of the Company or the
Guarantor. Moreover, without limiting the generality of the foregoing and except
as specifically provided in this opinion letter, we have not searched any
computerized or electronic data bases or the dockets or records of any court,
regulatory body or governmental agency or other filing office (including,
without limitation, the U.S. Patent and Trademark Office) in any jurisdiction.
The opinions set forth in this opinion letter are subject to the
following additional qualifications, limitations and exceptions:
(a) The opinions concerning the validity, legally binding
nature or enforceability of any provision of any Transaction Document
are subject to (i) the application of bankruptcy, insolvency,
avoidance, usury, bulk transfer, reorganization, moratorium or other
laws affecting the rights and remedies of creditors, including, without
limitation, any statutory or other law regarding fraudulent transfers
or conveyances, (ii) the application of equitable principles and public
policy considerations (including, without limitation, principles of
commercial reasonableness, good faith and fair dealing) regardless of
whether such principles and considerations are considered in a
proceeding
<PAGE> 98
Investors and 8
H.C. Wainwright & Co., Inc.
, 2000
in equity or at law, (iii) the effect of procedural due process, and
(iv) the discretion of the court or body before which any proceeding
therefor may be brought, including, without limitation, the court's
failure or refusal to enforce provisions of agreements or other
documents if enforcement thereof is based upon defaults or breaches
which are immaterial to the ultimate performance contemplated thereby
or for other reasons deemed equitable by the court; furthermore, no
opinion is expressed as to whether any such provision is specifically
enforceable in equity.
(b) The unenforceability, under certain circumstances, of
terms of any of the Transaction Documents and the Guaranty providing
for indemnification of or contribution to a party where such
indemnification or contribution is contrary to public policy;
(c) We express no opinion as to prospective waivers of (i)
rights to any notice or hearing, (ii) provisions purporting to
establish evidentiary standards, or (iii) rights to the extent any such
waivers violate matters of public policy.
(d) We express no opinion as to the enforceability, in any
particular circumstance, of any provision of the Transaction Documents
or the Guaranty which provides for the severability of illegal or
unenforceable provisions.
This opinion is solely for your benefit and, without our prior written
consent, shall not be quoted in whole or in part, summarized or otherwise
referred to, relied upon or filed with or supplied to any other person or
entity, except that you may deliver copies of this opinion to (i) your attorneys
acting on your behalf in connection with the Agreement and the transactions
contemplated thereby, (ii) governmental regulatory agencies having jurisdiction
over you to the extent that disclosure of this opinion is required by applicable
law or regulation, (iii) designated persons pursuant to order or other legal
process of any court or governmental agency or authority of competent
jurisdiction, (iv) Investors and prospective investors in the Notes and the
Warrants, and (v) the National Association of Securities Dealers, Inc.
We assume no obligation to supplement or update this opinion to reflect
any facts or circumstances which may hereafter come to our attention or any
changes in any laws or court decisions which may hereafter occur.
<PAGE> 99
Investors and 9
H.C. Wainwright & Co., Inc.
, 2000
Sincerely yours,
FRANKFURT, GARBUS, KLEIN & SELZ
By:
<PAGE> 100
EXHIBIT D
FORM OF GUARANTY OF RAMENDRA SINGH
<PAGE> 101
INDIVIDUAL GUARANTY
GUARANTY, dated as of February ____, 2000, from Ramendra P. Singh
("Guarantor") to the Investors, as such term is defined in the Second Warrant
and Senior Subordinated Convertible Note Purchase Agreement, dated the date
hereof (the "Agreement"), by and among the Investors and Dynacs Inc. (the
"Company").
For valuable consideration, the receipt of which is hereby
acknowledged, and to induce the Investors to loan the Company up to $1,900,000
evidenced by certain Second Senior Subordinated Convertible Promissory Notes
dated the date hereof (the "Notes"), the undersigned Guarantor hereby agrees as
follows:
1. Guarantor acknowledges that he is fully aware of the terms and
conditions of the Notes and does hereby jointly and severally, irrevocably and
unconditionally, guarantee, as primary obligor and not as a surety merely,
without offset or deduction, the full and prompt payment when due of all sums
presently or hereafter owing by the Company to each Investor pursuant to such
Investor's Note, whether arising by sale, note, assignment or otherwise (the
payment of all sums owing by the Company pursuant to each Note being hereinafter
referred to as an "Obligation"). In the event that the Company fails to pay any
Obligation for any reason, Guarantor will pay or otherwise provide for and bring
about promptly when due the payment of such Obligation. This Guaranty shall
constitute a guaranty of payment and not of collection. Guarantor specifically
agrees that it shall not be necessary or required, and that Guarantor shall not
be entitled to require, that any Investor (a) file suit or proceed to obtain or
assert a claim for personal judgment against the Company or any other person
liable for any Obligation, (b) make any effort at collection or other
enforcement of any Obligation from or against the Company or any other person,
(c) foreclose against or seek to realize upon collateral security now or
hereafter existing for any Obligation, (d) exercise or assert any other right or
remedy to which the Investors are or may be entitled in connection with any
Obligation or any collateral security or other guaranty thereof, or (e) assert
or file any claim against the assets of the Company or any other guarantor or
other person liable for any Obligation or any part thereof, before or as a
condition of requiring payment or performance of any Obligation by Guarantor
hereunder, or at any time hereunder.
2. Guarantor waives notice of the acceptance of this Guaranty,
presentment to or demand for payment or other performance by the Company or any
other person, notice of non-payment or failure to perform on the part of the
Company, and all other notices to which Guarantor might otherwise be entitled to
in connection with the Guaranty or any Obligation including, without limitation,
notice of sale of any collateral security therefore. The obligations of
Guarantor hereunder shall be absolute, continuing and unconditional. Each
Investor shall be at liberty, without giving any notice to or obtaining the
assent of Guarantor and without relieving Guarantor of any liability hereunder
or prejudicing, impairing or otherwise affecting the rights of any Investor
hereunder, to deal with the Company and with each other person who now is or
hereafter becomes liable for any
<PAGE> 102
Obligation, in such manner as any such Investor in its sole discretion deems
fit, and to this end Guarantor gives each Investor full authority to do any and
all of the following things from time to time: (a) vary the terms (excluding (i)
an increase of the aggregate principal amount due under its Note or (ii) an
increase of the applicable interest rate provided for under its Note on the
applicable date of issuance) and grant extensions or renewals of any present or
future indebtedness of the Company or any such other person, (b) grant time,
waivers and other indulgences in respect thereof, (c) vary, exchange, surrender,
forfeit, release or discharge, wholly or partially, or delay in or abstain from
perfecting and enforcing, any collateral security or guaranty or other means of
obtaining payment of any Obligation, (d) accept partial payments from the
Company or any such other person, (e) release or discharge, wholly or partially,
any endorser or guarantor, and (f) compromise or make any settlement or other
arrangement with the Company or with any other person primarily liable with
respect to all Notes or otherwise with the Company, provided that such
compromise, settlement or other arrangement in no way prejudices the Company or
Guarantor or increases the liability of either of them hereunder.
NOTWITHSTANDING THE FOREGOING, UPON THE FULL SATISFACTION, CANCELLATION OR
CONVERSION OF ALL OF THE NOTES, GUARANTOR'S OBLIGATIONS UNDER THIS GUARANTY WITH
RESPECT TO ALL NOTES OR OTHERWISE SHALL AUTOMATICALLY TERMINATE IN THEIR
ENTIRETY WITHOUT FURTHER ACTION OF OR NOTICE GIVEN BY GUARANTOR AND WITHOUT
FURTHER RECOURSE BY THE HOLDERS OF THE NOTES, EXCEPT AS PROVIDED BY SECTION 5,
IF APPLICABLE.
3. No right, power or remedy herein conferred upon or reserved to the
Investors is intended to be exclusive of any other right, power or remedy or
remedies, and each and every right, power and remedy of the Investors pursuant
to this Guaranty now or hereafter existing at law or in equity or by statute or
otherwise shall, to the extent permitted by law, be cumulative and concurrent
and shall be in addition to each other right, power or remedy pursuant to this
Guaranty, and the exercise by the Investors of any one or more such rights,
powers or remedies shall not preclude the simultaneous or later exercise by the
Investors of any or all such other rights, powers or remedies.
4. No failure or delay by any Investor to insist upon the strict
performance of any term, condition, covenant or agreement of this Guaranty or to
exercise any right, power or remedy hereunder or consequent upon a breach hereof
shall constitute a waiver of any such term, condition, covenant, agreement,
right, power or remedy of any such breach by such Investor or any other
Investor, or preclude such Investor or any other Investor from exercising any
such right, power or remedy at any later time or times.
5. Guarantor shall reimburse each Investor on demand for all expenses
reasonably incurred by such Investor in the enforcement of any of such
Investor's rights hereunder against Guarantor, including accountable
out-of-pocket expenses and reasonable attorney's fees.
-2-
<PAGE> 103
6. In case any one or more of the provisions contained in this Guaranty
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby.
7. This Guaranty (a) constitutes the entire agreement, and supercedes
all prior agreements and understandings, both written and oral, among the
Investors and Guarantor with respect to the subject matter hereof, (b) may be
changed, waived, discharged or terminated only by an instrument in writing
signed by the applicable Investor and Guarantor, and (c) shall be binding upon
Guarantor and the Investors and shall inure to the benefit of Guarantor and the
Investors and their respective successors and assigns.
8. Unless otherwise specifically provided herein, all notices,
instructions, requests and other communications required or permitted hereunder
shall be in writing and shall become effective when received or if mailed when
deposited in the United States mail, postage prepaid, registered or certified
mail, return receipt requested. Notices shall be directed to each Investor at
its address set forth in the Agreement and to Guarantor at its address set forth
in the Agreement, or at such other address as such party may from time to time
furnish to the other by notice similarly given.
9. This Guaranty shall be governed by, and construed in accordance
with, the laws of the State of New York.
IN WITNESS HEREOF, the Guarantor has set his hand and seal as of the
date first written above.
Ramendra P. Singh
-------------------------------
Name of Guarantor
-------------------------------
Guarantor's Signature
-------------------------------
Home Address
-------------------------------
City, State & Zip Code
-------------------------------
Witness and Date
-3-
<PAGE> 104
ANNEX A
SUBSIDIARIES
<TABLE>
<CAPTION>
ENTITY OWNERSHIP BY DYNACS (%)
------ -----------------------
<S> <C>
Dynacs Technical Services, Inc. 100%
Dynacs Digital Services, Inc. 100%
Dynacs Properties, Inc. 50%
Cerulean FXs, Inc. 80%
</TABLE>
<PAGE> 105
ANNEX B
ADDITIONAL SUBSIDIARIES
<TABLE>
<S> <C>
Dynacs Digital Studios (India) Pvt. Ltd. 99.992%
Dynacs Engineering (India) Pvt. Ltd. 99%
</TABLE>
<PAGE> 106
ADDENDUM TO SECOND WARRANT AND SENIOR SUBORDINATED CONVERTIBLE NOTE
PURCHASE AGREEMENT (the "Agreement"), dated as of March 15, 2000, between DYNACS
INC., a Delaware corporation (the "Company"), and _________.
Section 2.2 of the Agreement is amended to add the following provision:
(k) Non-U.S. Person. Investor is satisfied as to the full observance of
the laws of its jurisdiction in connection with the purchase of the Notes and
the Warrants, including (i) the legal requirements within its jurisdiction for
the purchase of the Notes and the Warrants, (ii) any foreign exchange
restrictions applicable to such purchase, (iii) any governmental or other
consents that may need to be obtained, and (iv) the income tax and other tax
consequences, if any, that may be relevant to the purchase, holding, redemption,
sale or transfer of the Notes and the Warrants. Such Investor's subscription and
payment for, and Investor's continued beneficial ownership of the Notes and the
Warrants, will not violate any applicable securities or other laws of the
Investor's jurisdiction.
All other terms and conditions of the Agreement shall remain in full
force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
DYNACS INC. INVESTOR:
By: /s/ Harry Schubele III By:
------------------------------ ----------------------------
Name: Harry Schubele, III Name:
Title: Senior Vice President Title:
<PAGE> 1
Exhibit 10.13
EXECUTION COPY
================================================================================
SHAREHOLDERS AGREEMENT
Dated as of August 13, 1999
By and Among
DYNACS ENGINEERING COMPANY, INC.
("COMPANY"),
RAMENDRA P. SINGH
PETER LIKINS
ROBERT SKELTON
JAVER E. BENAVENTE
JAYANT RAMAKRISHNAN
HARRY W. SCHUBELE
RAVI VENUGOPAL
RAMESH VENUGOPAL
("EXISTING SHAREHOLDERS"),
And
MICHAEL BURNS
WILLIAM DALLAS
JON FELTHEIMER
OFFENSE GROUP ASSOCIATES, LP
("INVESTORS")
================================================================================
<PAGE> 2
TABLE OF CONTENTS
PAGE
1. Definitions ......................................................... 2
2. Restrictions on Transfer ............................................ 4
(a) General Restrictions .......................................... 4
(b) Closing of Permitted Transfers ................................ 4
3. Permitted Transfers of Shares ....................................... 5
(a) Shareholder Transfers ......................................... 5
(b) Transfers to Family Members, Trusts or Other Legal Entities ... 5
(c) Qualified Transferees ......................................... 5
4. Right of First Refusal .............................................. 6
(a) Transfer Notice ............................................... 6
(b) Acceptance .................................................... 7
(c) Allocation of Offered Shares .................................. 7
(d) Transfer to Subscribing Shareholders .......................... 7
(e) Transfer to Transferee ........................................ 8
CoSale Right in Sale of Voting Control .............................. 8
(a) Rights of CoSale .............................................. 8
(b) Exercise of CoSale Right ...................................... 8
6. Other Transfers of Shares ........................................... 9
(a) Involuntary Transfers ........................................ 9
(b) Purchase Rights .............................................. 10
(c) Purchase Procedures .......................................... 10
(d) Determination of Fair Market Value of Shares Procedures ...... 10
7. Restrictive Endorsement on Share Certificates ....................... 11
8. Agreements of Certain Spouses ....................................... 11
9. Termination of Existing Agreements .................................. 11
10. Board of Directors .................................................. 11
11. Miscellaneous ....................................................... 12
(a) Notices ....................................................... 12
(b) Amendment ..................................................... 12
(c) Termination ................................................... 12
(d) Waiver ........................................................ 12
i
<PAGE> 3
(e) Equitable Relief ............................................. 13
(f) Counterparts ................................................. 13
(g) Construction ................................................. 13
(h) Governing Law ................................................ 13
(i) Benefit and Binding Effect ................................... 13
(j) Future Spousal Consents ...................................... 13
(k) Further Assurances ........................................... 13
Exhibits:
Exhibit A -- Existing Shareholders and Outstanding Shares
Exhibit B -- Investors
Exhibit C -- Spousal Consent
ii
<PAGE> 4
SHAREHOLDERS AGREEMENT
THIS SHAREHOLDERS AGREEMENT (this "Agreement"), is made and entered into
as of August 13, 1999, by and among DYNACS ENGINEERING COMPANY, INC., a Florida
corporation (the "Company"), the shareholders of the Company whose names appear
on Exhibit A to this Agreement (collectively referred to in this Agreement as
the "Existing Shareholders" and each as an "Existing Shareholder"), and those
persons whose names appear on Exhibit B to this Agreement (collectively referred
to in this Agreement as the "Investors" and each as an "Investor"). The Existing
Shareholders and the Investors are collectively referred to in this Agreement,
together with all other persons who may hereafter become parties to this
Agreement, as the "Shareholders".
RECITALS
A. As of the date of this Agreement, the Existing Shareholders own of
record and beneficially the number of shares of common stock, par value $.001
per share, of the Company (the "Common Stock") set forth opposite their
respective names on Exhibit A, constituting 100% of the outstanding equity
securities of the Company.
B. Upon consummation of the transactions contemplated by that certain
Contribution and Exchange Agreement, dated as of August 12, 1999, by and among
the Company, Cerulean FXs, Inc., a Florida corporation ("FX"), Cerulean
Colorization, L.L.C., a Delaware limited liability company ("Cerulean"), and the
Investors (the "Contribution Agreement"), Cerulean will become a wholly-owned
subsidiary of FX, the Company will acquire 80,000 shares of common stock, par
value $0.01 per share, of FX (the "FX Common Stock"), and the Investors will
acquire an aggregate of 20,000 shares of FX Common Stock.
C. Concurrently with or prior to the execution of this Agreement, the
Company, Ramendra P. Singh and the Investors have executed that certain Exchange
Agreement (the "Exchange Agreement") which provides, among other things, for the
issuance to the Investors of shares of Common Stock in exchange for the shares
of FX Common Stock held by the Investors upon the occurrence of certain events.
D. It is a condition to the consummation of the transactions contemplated
by the Contribution Agreement that this Agreement be entered into by the
Company, the Existing Shareholders and the Investors.
2
<PAGE> 5
A G R E E M E N T
NOW, THEREFORE, in consideration of the foregoing premises and of the
mutual covenants and agreements contained in this Agreement, on the terms and
subject to the conditions set forth in this Agreement, the parties to this
Agreement agree as follows:
1. Definitions Capitalized terms used in this Agreement and not defined in
this Agreement shall have the meanings given those terms in the Contribution
Agreement. Otherwise, the following terms have the following meanings, unless
the context otherwise requires:
"1998 Shareholders' Agreement" means that certain Shareholders'
Agreement, dated October 21, 1998, among the Company, Ramendra P. Singh, Robert
E. Skelton, Peter Likins, Javier E. Benavente, Jayant Ramakrishnan, Harry W.
Schubele III and Ravi Venugopal.
"Affiliate" means, with respect to a specified Person, any Person
that directly or indirectly through one or more intermediaries controls or is
controlled by, or is under common control with, the specified Person.
"Business day" means a day other than Saturday, Sunday or other day
on which commercial banks in New York, New York, are authorized or required by
law to close.
"Buy-Sell Agreement" means that certain Buy-Sell Agreement, dated
March, 1996, among the Company, Ramendra P. Singh, Robert E. Skelton and Peter
Likins.
"CoSale Period" and "CoSale Right" have the respective meanings set
forth in Section 6 of this Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Shares" means the shares of Common Stock that may be
issued by the Company to the Investors pursuant to the terms of the Exchange
Agreement.
"Fair Market Value" means (i) with respect to the Shares, the price
determined pursuant to Section 6(d) of this Agreement; and (ii) with respect to
any property other than the Shares with respect to which the fair market value
is to be determined, the price of the property that a willing buyer would pay in
an all-cash transaction with an equally willing seller in the event of a
disagreement regarding the Fair Market Value of property other than the Shares,
the resolution procedures of Section 6(d) shall apply.
"Family Member" means, with respect to any Person, any descendant of
the grandfather of the Person, the Person's spouse or any descendant of the
grandfather of the Person's spouse.
"FGCA" means the Florida General Corporation Act.
2
<PAGE> 6
"Involuntary Transfer" and "Involuntary Transfer Event" shall have
the respective meanings set forth in Section 6 of this Agreement.
"Member Representative" shall have the meaning given such term in
Section 2.2 of the Contribution Agreement.
"Offered Price", "Offered Shares", "Offered Terms and Conditions"
and "Other Shareholders" have the respective meanings set forth in Section 4 of
this Agreement.
"Person" means any individual, corporation, partnership, firm,
joint venture, association, joint-stock company, trust, incorporated
organization or other entity.
"pro rata" means, with respect to any determination, that the
determination is based on the relative percentages of Shares then held by all of
the Shareholders after giving pro forma effect to the issuance by the Company,
and the ownership by the Investors, of all of the Exchange Shares at the time
the determination is made, as if all of the Exchange Shares had been then
issued.
"Proposed Transferee" has the meaning set forth in Section 3(c) of
this Agreement.
"Qualified Public Offering" means the closing of (i) an underwritten
public offering of the Common Stock pursuant to an effective registration
statement filed with the Securities and Exchange Commission under the Securities
Act, or (ii) a merger of the Company with and into another entity pursuant to
which the shareholders of the Company immediately prior to the effective date of
the merger receive, upon consummation of the merger, shares of voting securities
of the surviving entity or its parent that are registered under Section 12 of
the Exchange Act and trade on the New York Stock Exchange, the American Stock
Exchange, the Nasdaq National Market or the Nasdaq SmallCap Market.
"Sale of Voting Control" means any transfer, or series of related
transfers, of Shares to any Person who, in the aggregate with all Family Members
and Affiliates of such Person, and any other Persons who are part of a syndicate
or group (as defined in Section 13(d)(3) of the Exchange Act) with such Person,
would (after giving effect to the transfer but disregarding any Shares held by
the Person, his or her Family Members and Affiliates, and syndicate or group
prior to the transfer) own Shares constituting more than 50% of the voting power
of the then issued and outstanding Shares (after giving pro forma effect to the
issuance by the Company, and the ownership by the Investors, of all of the
Exchange Shares at the time the determination is made, as if all of the Exchange
Shares had been then issued).
"Securities Act" means the Securities Act of 1933, as amended.
"Shares" means any shares of Common Stock subject to this Agreement.
"Stock Subscription Agreements" means, collectively, (i) that
certain Stock Subscription Agreement, dated February 3, 1996, between the
Company and Ravi Venugopal, (ii) that certain Stock Subscription Agreement,
dated February 3, 1996, between the Company and Jayant Ramakrishnan, (iii) that
certain Stock Subscription Agreement, dated February 3, between the
3
<PAGE> 7
Company and Harry W. Schubele, and (iv) that certain Stock Subscription
Agreement, dated February 3, 1996, between the Company and Javier Benavente.
"transfer" means any sale, assignment, transfer, pledge,
hypothecation, gift, encumbrance or other disposition of Shares.
"Transferee", "Transferor" and "Transfer Notice" have the
respective meanings set forth in Section 4 of this Agreement.
2. Restrictions on Transfer.
(a) General Restrictions. During the term of this Agreement, none of
the Shares now owned or acquired after the date of this Agreement by any of the
Shareholders may be transferred unless and until:
(i) the transfer of Shares shall be made in accordance with
the provisions of this Agreement;
(ii) the proposed recipient of the Shares shall have delivered
to the Company a signed counterpart of this Agreement or a written
acknowledgment for the benefit of the parties to this Agreement, that the Shares
to be received in the proposed transfer are subject to this Agreement and that
the proposed recipient and his successors in interest are and will be bound by
this Agreement and agree to comply with the provisions of this Agreement
relating to the transferred Shares; and
(iii) the transfer shall have been made pursuant to an
effective registration under the Securities Act and any applicable state
securities laws, or an exemption from registration, and prior to any transfer
the Shareholder proposing to transfer Shares shall have delivered to the Company
(A) notice describing the manner and circumstances of the proposed transfer
(copies of which the Company shall furnish to each Shareholder following receipt
of the notice by the Company) and (B) if requested by the Company, a written
opinion of legal counsel, which shall be reasonably satisfactory to the Company
and its counsel, to the effect that the proposed transfer of Shares may be
effected without registration under the Securities Act and any applicable state
securities laws.
ANY ATTEMPTED TRANSFER OF SHARES OTHER THAN IN ACCORDANCE WITH THIS AGREEMENT
SHALL BE NULL AND VOID AND THE COMPANY MAY REFUSE TO (i) RECOGNIZE THE TRANSFER
AND NOT REFLECT IN ITS RECORDS ANY CHANGE IN RECORD OWNERSHIP OF SHARES PURSUANT
TO THE TRANSFER AND (ii) TREAT AS OWNER OF THE SHARES OR TO ACCORD THE RIGHT TO
VOTE AS THE OWNER OF THE SHARES OR TO PAY DIVIDENDS TO ANY TRANSFEREE TO WHOM
THE SHARES SHALL HAVE BEEN TRANSFERRED.
(b) Closing of Permitted Transfers. The closing of any transfer of
Shares permitted pursuant to this Agreement shall take place at the principal
executive offices of the Company unless otherwise agreed by the parties involved
in the transfer. Any Shareholder which
4
<PAGE> 8
transfers Shares shall (i) do all things and execute and deliver all papers as
may be necessary or reasonably requested by the Company in order to consummate
the transfer of the Shares, (ii) pay all amounts as may be required for any
applicable stock transfer taxes, and (iii) pay to the Company any expenses
reasonably incurred by the Company in connection with the transfer (including
reasonable attorneys' fees).
3. Permitted Transfers of Shares. Subject to Section 2 of this Agreement,
any Shareholder may transfer Shares in accordance with the terms and conditions
of this Section 3.
(a) Shareholder Transfers. Any Shareholder may transfer any or all
of his Shares as follows:
(i) to any third party, provided that (A) the transferee
satisfies the requirements of Section 3(c) of this Agreement, (B) the Shares are
first offered for sale to the Company and all other Shareholders in accordance
with the procedures in Section 4 of this Agreement, and (C) if the transfer
involves a Sale of Voting Control, it shall be made subject to the provisions of
Section 5 of this Agreement; except that the foregoing provisos shall not apply
to a transfer to the Family Members of a Shareholder or a trust, investment fund
or other legal entity pursuant to Section 3(b); or
(ii) to the Company.
(b) Transfers to Family Members, Trusts or Other Legal Entities. Any
Shareholder may transfer all or a portion of their respective Shares, by death
or inter vivos, (i) to any of the Shareholder's Family Members, (ii) to any
trust established solely for the benefit of the Shareholder or one or more of
the Shareholder's Family Members, or to any legal entity in which the
Shareholder or any of these Persons are the sole beneficial owners, or (iii) if
the Shareholder is an investment fund, to any other investment fund in which the
general partner or investment advisor of the Shareholder is the general partner
or investment advisor of the other investment fund. Any Shares transferred to
the executor of an estate, in the case of death, to any Family Member, or to any
trust, investment fund or other legal entity described above in subsection
(ii) or (iii) of this paragraph, shall be subject to the provisions of this
Agreement. No transfer of Shares may be made to any of the foregoing Persons
unless and until the Person delivers to the Company a signed counterpart of this
Agreement or a written acknowledgment that the Shares to be received in the
proposed transfer are subject to this Agreement and that the Person and his
successors in interest are bound by this Agreement and agree to comply with its
terms. Any attempted transfer of Shares to any of the foregoing Persons other
than in accordance with this Section 3(b) shall be null and void and the Company
will refuse to recognize the transfer and not reflect in its records any change
in record ownership of Shares pursuant to the transfer, and the Company will
refuse to treat as owner of the Shares or to accord the right to vote as the
owner or to pay dividends to any transferee to whom the shares shall have been
transferred.
(c) Qualified Transferees. Except as provided in Section 3(a)(ii)
and/or Section 3(b), no Shareholder shall transfer any Shares pursuant to the
provisions of this Agreement unless the person or group of related persons who
collectively are the proposed transferee (the "Proposed
5
<PAGE> 9
Transferee") meets each of the following criteria and delivers a certificate
executed by the Proposed Transferee and addressed to the Company and each of the
Shareholders certifying that:
(i) the Proposed Transferee is not acting in concert with or
on behalf of the transferor or any affiliate of the transferor with the purpose
of evading, avoiding or impairing any of the Shareholders' rights of first
refusal under Section 4 of this Agreement, co-sale rights under Section 5 of
this Agreement or purchase rights under Section 6 of this Agreement.
(ii) the Proposed Transferee is acquiring the Shares for his
own account and not as an agent, bailee or nominee or on behalf of any person or
with a view toward resale of the Shares;
(iii) the Proposed Transferee is not engaged in a business
substantially similar to or which is otherwise in competition with the
then-existing businesses of the Company, nor serving as an employee, officer,
director or stockholder, directly or indirectly and whether as principal, agent
or employee or otherwise, of any entity engaged in such business, or acting
alone or in association with any individual or any other entity carrying on,
engaging in, employed by or taking part in, consulting or advising or owning,
sharing in the earnings of, or financing, whether as lender, investor or
otherwise, any entity engaged in such business; provided, that it shall be
permissible for the Proposed Transferee to invest in stock, bonds or other
securities of an entity competing with the Company if (A) the stock, bonds or
other securities are listed on any national securities exchange or have been
registered under Section 12(g) of the Exchange Act, and (B) the investment does
not equal or exceed, in the case of any class of capital stock of any one
issuer, 1% of the issued and outstanding shares of the capital stock, or, in the
case of bonds or other securities, 1% of the aggregate principal amount thereof
issued and outstanding; and
(iv) the Proposed Transferee has reviewed the Transfer Notice
delivered to the Shareholders pursuant to Section 4(a) of this Agreement and
represents that (A) the Transaction Notice is true and correct, (B) the offer
referred to in the Transaction Notice constitutes a bona-fide offer to purchase
the referenced shares, (C) the Proposed Transferee is ready, willing and able to
consummate the transaction described in the Transaction Notice; and (D) the
Transfer Notice contains a true and complete description of the material terms
of all material contracts, agreements, understandings and other arrangements,
oral or written, relating to the purchase of securities.
4. Right of First Refusal. Other than (i) a transfer under Section
3(a)(ii) to the Company, or (ii) a transfer under Section 3(b) to the Family
Members of a Shareholder or a trust, investment fund or other legal entity
described in Section 3(b), Shares may be sold to any person or group of related
persons (collectively, the "Transferee") only after compliance with the
provisions of this Section 4 and in accordance with the other provisions of this
Agreement.
(a) Transfer Notice. Any Shareholder proposing to make a transfer of
Shares (the "Transferor") shall deliver a written notice of the proposed
transfer (the "Transfer Notice") to the Company and to each of the other
Shareholders entitled to receive an offer to purchase under the provisions of
this Agreement (the "Other Shareholders"). The Transfer Notice shall contain a
description of the proposed transaction and the terms of the proposed
transaction, including (i) the number of Shares to be transferred (the "Offered
Shares"), (ii) the name of the Transferee, including,
6
<PAGE> 10
specifically, the name of each person to whom or in favor of whom the proposed
transfer is to be made, (iii) the per share price at which the Offered Shares
are proposed to be sold to the Transferee (the "Offered Price"), (iv) the terms
of payment of the Offered Price and the other terms and conditions to the
proposed sale to the Transferee (the "Offered Terms and Conditions"), and (iv)
an offer to the Company and the Other Shareholders to sell to them the Offered
Shares on the same terms and conditions as contained in the Transfer Notice.
Notwithstanding the foregoing, if the proposed sale of the Offered Shares to the
Transferee provides for consideration other than solely cash and/or promissory
notes, the Company and the Other Shareholders shall have the right to purchase
the Shares for, in lieu of the consideration, cash in an amount equal to the
Fair Market Value of the consideration and in such case, the Transfer Notice
shall state the Transferor's estimate of the Fair Market Value of the
consideration, which shall be binding upon the Transferee (but not the Company
or the Other Shareholders).
(b) Acceptance. The offer may be accepted only by giving written
notice of acceptance to the Transferor within 30 days of receipt of the Transfer
Notice. Each of the Other Shareholders who accept the offer (the "Subscribing
Shareholders") shall also deliver a copy of their notice of acceptance to the
Company. A Subscribing Shareholder may subscribe in its acceptance for any
portion or all of the Offered Shares.
(c) Allocation of Offered Shares. The number of Offered Shares
purchased by the Company and each Subscribing Shareholder shall be determined as
follows:
(i) the Company shall have the right to purchase all or any
portion of the Offered Shares;
(ii) each Other Shareholder shall have the right to purchase
his pro rata share of an amount of Shares equal to the Offered Shares minus the
number of Shares purchased by the Company;
(iii) if any Offered Shares remain unallocated and all
subscriptions from Subscribing Shareholders have not been filled, the balance of
the unallocated Offered Shares shall be iteratively offered and allocated pro
rata by the Company among the Subscribing Shareholders whose subscriptions have
not been filled until either all the Offered Shares have been allocated or all
subscriptions have been filled.
(d) Transfer to Subscribing Shareholders. If the Offered Shares have
been fully subscribed for, the Company shall give written notice to that effect
to the Transferor and all Subscribing Shareholders, stating the number of
Offered Shares allocated to the Company and each Subscribing Shareholder, and
the transfer of the Offered Shares shall thereafter be effected between the
Transferor, the Company and the Subscribing Shareholders upon all of the
applicable terms and conditions set forth in the Transfer Notice.
(e) Transfer to Transferee. If the Company and the Subscribing
Shareholders, in the aggregate, have not elected to purchase all of the Offered
Shares, the Company shall give written notice to that effect to the Transferor
and all Subscribing Shareholders, the subscriptions of the Company and each of
the Subscribing Shareholders shall automatically be void, and, subject to the
7
<PAGE> 11
provisions of Section 5 of this Agreement, the Transferor may sell the Offered
Shares to the Transferee, provided, that the sale is consummated within 60 days
of the date the Transfer Notice was received by the Company, and provided,
further, that the sale is in accordance with all the Offered Terms and
Conditions (or otherwise on terms and conditions of the transaction no more
favorable to the Transferee than the terms and conditions on which the Offered
Shares were proposed to be sold to the Company or the Other Shareholders, as set
forth in the Transfer Notice) and upon the terms and conditions set forth in
this Agreement. If the Transferor does not consummate the sale of the Offered
Shares to the Transferee within said 60 day period, the Offered Shares will
thereafter again be subject to this Section 4.
5. CoSale Right in Sale of Voting Control
(a) Rights of CoSale. If at any time a Transferor, acting alone or
with his Family Members or Affiliates, proposes to transfer Shares in a Sale of
Voting Control to a Transferee, and the Company and the Other Shareholders are
not purchasing the Shares pursuant to the provisions of Section 4 above, each
Other Shareholder which notifies the Transferor in writing within 20 days (the
"CoSale Period") after receipt of the notice from the Company described in
Section 4(e) above, shall have the right (the "CoSale Right") to sell to the
Transferee at the Offered Price and upon the Offered Terms and Conditions a
portion of the number of Shares the Transferor proposes to sell to the
Transferee that is equal to (i) the number of Shares owned by the Other
Shareholder and any of his or its Family Members and Affiliates, multiplied by
(ii) a fraction equal to (x) the number of Shares proposed to be sold to the
Transferee by the Transferor and any of his Family Members and Affiliates,
divided by (y) the total number Shares owned by the Transferor and any of his
Family Members and Affiliates; whereupon the Transferor will assign so much of
its interest in the agreement of sale as each Other Shareholder shall be
entitled to and shall request pursuant to this Section 5(a), the number of
Shares to be sold by the Transferor will be reduced by the aggregate number of
Shares to be sold by each Other Shareholder, each Other Shareholder will assume
the part of the obligations of the Transferor under the agreement of sale as
shall relate to the sale of securities by the Other Shareholder and the
Transferor shall not sell any Shares to the Transferee unless the Transferee
concurrently purchases the appropriate number of Shares from each Other
Shareholder who has exercised his or its right to sell under this Section 5(a).
(b) Exercise of CoSale Right. Each of the Other Shareholders who
exercises his or its CoSale Right by delivering to the Transferor during the
CoSale Period notice of intent to exercise shall include in the notice the
number of Shares that the Other Shareholder elects to transfer, which number may
not, without the consent of the Transferor, exceed the number of Shares the
Other Shareholder is permitted to sell pursuant to the CoSale Right. At the
closing of the transfer, each Other Shareholder must provide for sale to the
Transferee, free and clear of all liens and rights of third parties, the one or
more certificates, properly endorsed for transfer or accompanied by stock powers
duly executed in blank, which represent the number of Shares which the Other
Shareholder elects to transfer pursuant to the exercise of his or its CoSale
Right. In the event the certificate or certificates representing the Shares
evidences a greater number of Shares than that elected to be transferred, the
Other Shareholder shall deliver the certificate or certificates to the Company
prior to the closing of the transfer with instructions for the Company to
promptly re-issue new certificates in proper denominations to effect the
transfer. Each Other Shareholder agrees to make the representations and
warranties regarding the Company and its Subsidiaries and his or its ownership
8
<PAGE> 12
of the Shares as the Transferor may be required to make to the Transferee,
provided, such representations and warranties shall be reasonably acceptable to
the Other Shareholder and provided, further, that the Other Shareholder's
liabilities for breach of the representations and warranties shall be limited to
the Other Shareholder's proceeds of the sale of his or its Shares pursuant to
the exercise of the CoSale Right, and provided, further, that if any Other
Shareholder is not involved in the business of the Company, any representations
or warranties that the Other Shareholder is required to make to the Transferee
with respect to the business of the Company shall be limited to the best
knowledge of the Other Shareholder.
6. Other Transfers of Shares.
(a) Involuntary Transfers. Any one or more of the following events
or conditions ("Involuntary Transfers") shall be deemed to constitute an offer
to transfer Shares held by any Shareholder:
(i) the event that (A) the Shareholder is adjudicated a
bankrupt, or (B) any action of any nature whatsoever (whether voluntary or
involuntary) is taken for the Shareholder's relief under any bankruptcy,
reorganization, receivership, liquidation, insolvency, compromise, arrangement
or moratorium statute, law or regulation, whether now in force or hereafter
enacted, or (C) any assignment is made for the benefit of the Shareholder's
creditors, or (D) any petition (whether voluntary or involuntary) is made or
filed for the appointment of a receiver, liquidator, trustee or custodian for
any of the Shareholder's assets, or if any receiver, liquidator, trustee or
custodian for any of the Shareholder's assets is appointed, and the petition or
the receiver, liquidator, trustee or custodian is not withdrawn or discharged
within 30 days from the date of filing, making or appointment, or (E) the
Shareholder acknowledges in writing that he or it has become unable to pay its
debts as they become due, or (F) the Shareholder is dissolved or its business is
substantially terminated for any reason whatsoever;
(ii) a determination that the Shareholder is incompetent, and
for this purpose an individual shall be deemed to be incompetent one year
following the occurrence, without subsequent revocation or annulment within the
one year period, of any of the following actions: (a) a conservator of the
person or estate has been appointed for the individual, (b) a court with
jurisdiction has determined that the individual is incompetent or lacks
capacity, or (c) two licensed physicians have certified in writing that in their
opinion the individual is substantially unable to manage his or her financial
resources or resist fraud or undue influence; or
(iii) any other event which, were it not for the provisions of
this Agreement, would cause any Shares, or any interest therein, to be
transferred, for consideration or otherwise, to any person, whether voluntarily,
involuntarily, or by operation of law under circumstances not constituting
approved means of transfer under this Agreement.
Nothing in this Section 6(a) shall be deemed to authorize any transfer not
expressly permitted under Section 3 of this Agreement. Any purported transfer of
any Shares in violation of any of the provisions of this Agreement shall be void
and shall not be recognized by the Company and the purported transferee shall
not be entitled to vote or receive any dividends on or distributions or payments
with respect to the Shares.
9
<PAGE> 13
(b) Purchase Rights. Upon the occurrence of any event specified in
Section 6(a) (an "Involuntary Transfer Event"), first the Company and then the
other Shareholders pro rata shall have the right to purchase the Shares as if
the Shareholder had made an offer to sell the Shares.
(c) Purchase Procedures. Within 90 days after the occurrence of an
Involuntary Transfer Event, the Shareholder or his trustee in bankruptcy,
personal representative, conservator, or guardian (as appropriate) shall give
notice to the Company of the Involuntary Transfer Event, specifying the date of
the event and describing in reasonable detail the nature of the Involuntary
Transfer Event and the number of Shares affected. The notice shall be deemed to
be an offer to sell the Shares affected by the Involuntary Transfer Event first
to the Company and then the Other Shareholders pro rata at a price, in cash,
equal to the Fair Market Value of the Shares. If the Company has not received
the notice required by this Section 6(c), upon the expiration of the 90-day
period, any shareholder, director or officer of the Company who has knowledge of
the event may give notice to the Company at any time, and each Shareholder
hereby agrees that any such notice shall be deemed to be an offer on behalf of
the Shareholder or his estate to sell the Shares affected by the event delivered
as required by the first sentence of this Section 6(c). The offer to sell the
Shares affected by the event may be accepted by the Company at any time within
30 days after receipt of the offer by the Company. If the Company does not elect
to purchase all of the Shares, any remaining Shares affected by the event shall
be offered to the other Shareholders in accordance with the allocation
procedures set forth in Section 4(c) of this Agreement. The Company and, if the
Company declines to purchase all of the Shares, the other Shareholders shall
have the right to purchase all or any portion of the Shares offered for sale
pursuant to this Section 6(c).
(d) Determination of Fair Market Value of Shares Procedures. At the
time the Company or, if the Company declines to exercise the option for any
reason, a Shareholder (in either case, a "Purchaser") first exercises its option
to purchase Shares from a Shareholder under this Section 6, the Purchaser shall
submit to the Shareholder or his estate a written estimate of the per share Fair
Market Value of the Common Stock. The valuation shall be conclusive on the
Shareholder unless the Shareholder responds in a like manner within 30 days
following receipt of the Purchaser's estimate. If the Shareholder and the
Purchaser do not reach agreement as to the per Share Fair Market Value within 45
days following the Purchaser's exercise of its option to purchase, the
determination of the per share Fair Market Value shall be made by arbitration.
Only one arbitration proceeding may be conducted pursuant to this Section 6(d)
in connection with each sale of Shares upon an Involuntary Transfer Event. Once
arbitration proceedings have been commenced under this Section 6(d), no other
Purchaser may bring arbitration proceedings in connection with the same
transaction unless the arbitration proceedings are terminated without a
determination of Fair Market Value. To institute arbitration proceedings, the
Purchaser shall appoint an independent qualified appraiser, and notify the
Shareholder and the other Shareholders of his or its election. If the
Shareholder does not deliver written notice of appointment of another
independent qualified appraiser within 10 days after receipt of the Purchaser's
notice, the Purchaser's appraiser shall determine Fair Market Value. If the
Shareholder delivers the notice, the two appraisers shall appoint a third
independent qualified appraiser who shall determine the Fair Market Value. The
determination of the Fair Market Value completed in the manner provided in this
Section 6(d) shall be conclusive and binding upon the Shareholder and the
Purchaser, and all other parties to this Agreement. In no event, however, shall
the Fair Market Value determined by the arbitrator or arbitrators be outside of
the range of estimates of the Fair Market Value submitted by the Purchaser and
the Shareholder. The
10
<PAGE> 14
cost of the appraisal shall be paid by the party whose estimate of Fair Market
Value most varies from the value determined by the arbitrator (or if the
parties' estimates vary equally, the cost of the appraisal share be borne
equally between them). In connection with these valuations, the Company will, on
a confidential basis, deliver or provide access to each appraiser of all
information reasonably requested by the appraiser in order to determine the Fair
Market Value.
7. Restrictive Endorsement on Share Certificates. The face of each
certificate representing Shares now or hereafter held by a Shareholder shall be
stamped with a legend in substantially the following form:
"THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE
SECURITIES LAWS, HAVE BEEN TAKEN FOR INVESTMENT, AND MAY NOT BE SOLD OR
OFFERED FOR SALE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAW OR AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED."
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A SHAREHOLDERS
AGREEMENT DATED AS OF AUGUST 13, 1999, AS AMENDED FROM TIME TO TIME, A
COPY OF WHICH IS ON FILE AT THE OFFICE OF THE COMPANY AND WILL BE
FURNISHED TO ANY PROSPECTIVE PURCHASERS ON REQUEST. THE SHAREHOLDERS
AGREEMENT PROVIDES, AMONG OTHER THINGS, FOR CERTAIN RESTRICTIONS ON THE
SALE, TRANSFER, PLEDGE, HYPOTHECATION OR OTHER DISPOSITION OF THE SHARES
REPRESENTED BY THIS CERTIFICATE."
8. Agreements of Certain Spouses. This Agreement has been executed by the
respective spouses (the "Spouses") of the married Shareholders who are residents
of the State of California, each of whom may claim a community property or other
interest in the Shares from time to time held by his spouse (the "Community
Shares"). Each Spouse hereby represents and agrees that he or she has read and
understands the provisions of this Agreement and the effect of the provisions on
any community property or other interest he or she may have in the Community
Shares, including, among other things, the options of the Company and the
Shareholders other than his or her spouse to purchase the Shares pursuant to
this Agreement and the restrictions on Transfer of the Shares pursuant to
Section 2 of this Agreement.
9. Termination of Existing Agreements. Effective as of the date of this
Agreement, each and every provision of the 1998 Shareholders' Agreement and the
Buy-Sell Agreement, and Sections 6 through 19 of each of the Stock Subscription
Agreements, shall terminate and be of no further force or effect.
10. Board of Directors. The Company and the Existing Shareholders agree to
use their best efforts to cause two nominees designated by the Member
Representative to be elected and
11
<PAGE> 15
continued in office as directors of each of the Company and FX until a Qualified
Public Offering and for so long as the Holders own in the aggregate at least 5%
of the outstanding shares of Company Common Stock assuming (if the Exchange has
not previously occurred) the issuance by the Company of the Exchange Shares to
the Holders effective as of the record date established by the Board of
Directors of the Company for determining the shares of Company Common Stock
entitled to vote for the election of directors. The Company and the Existing
Stockholder will use their best efforts to cause the two nominees to be elected
or appointed to the Board of Directors of each of the Company and FX within 30
days following the date of this Agreement.
11. Miscellaneous
(a) Notices. Any and all notices, designations, consents, offers,
acceptances, or any other communications provided for in this Agreement shall be
given in writing by hand delivery or registered or certified mail which shall be
addressed, (i) in the case of the Company, to 5111 U.S. Highway 19 North, Suite
300, Palm Harbor, Florida 34684, Attn: President, and (ii) in the case of any
Shareholder, to the address of the party in records of the Company (or to such
other addresses as may be designated by the party). Except as otherwise provided
in this Agreement, each notice shall be deemed given at the time it is received.
(b) Amendment. Except as hereinafter provided no change or
modification of this Agreement shall be valid unless the same shall have been in
writing and signed by (i) all of the Shareholders and (ii) the Company. This
Agreement shall be automatically amended to include any additional Shareholders
who execute a counterpart of this Agreement.
(c) Termination. This Agreement shall terminate and expire on the
earliest to occur of (i) a Qualified Public Offering, and (ii) January 15, 2029;
provided, however, that this Agreement may be terminated at any time by an
instrument in writing signed by (x) all of the Shareholders and (y) the Company;
and provided, further, however, that the term of this Agreement may be extended
beyond January 15, 2029 if, at any time prior to such date, all of the parties
extend its duration for as many additional periods as they may desire. Whenever
the restrictions imposed hereby shall terminate, as hereinabove provided, the
holder of the Shares as to which such restrictions shall have terminated shall
be entitled to receive from the Company, without expense, a new stock
certificate or certificates not bearing the restrictive legend set forth in this
Agreement, and not containing any other reference to the restrictions imposed
hereby.
(d) Waiver. No failure or delay on the part of the Shareholders or
any of them in exercising any right, power or privilege hereunder, and no course
of dealing between the Company and the Shareholders or any of them shall operate
as a waiver thereof nor shall any single or partial exercise of any right, power
or privilege hereunder preclude the simultaneous or later exercise of any other
right, power or privilege. The rights and remedies in this Agreement expressly
provided are cumulative and not exclusive of any rights or remedies which the
Shareholders or any of them would otherwise have. No notice to or demand on the
Company in any case shall entitle the Company to any other or further notice or
demand in similar or other circumstances or constitute a waiver of the rights of
the Shareholders or any of them to take any other or further action in any
circumstances without notice or demand.
12
<PAGE> 16
(e) Equitable Relief. The parties to this Agreement agree and
declare that legal remedies may be inadequate to enforce the provisions of this
Agreement and that equitable relief including specific performance and
injunctive relief, may be used to enforce the provisions of this Agreement.
(f) Counterparts. This Agreement maybe executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
(g) Construction. When necessary, the masculine shall include the
feminine or neuter and the singular shall include the plural and vice versa.
(h) Governing Law. This Agreement shall be governed and construed in
accordance with the laws of the State of California, without regard to conflicts
of law principles thereof.
(i) Benefit and Binding Effect. This Agreement shall be binding upon
and shall inure to the benefit of the Company, its successors and assigns, and
each of the Shareholders and their respective executors, administrators and
personal representatives and heirs and their successors and assigns. In the
event that any part of this Agreement shall be held to be invalid or
unenforceable, the remaining parts thereof shall nevertheless continue to be
valid and enforceable as though the invalid portions were not a part of this
Agreement. Except as expressly provided above, this Agreement does not create,
and shall not be construed to create, any rights enforceable by any person not a
party to this Agreement.
(j) Future Spousal Consents. Each Shareholder who is a resident of
the State of California and is not presently married agrees to use his best
efforts to cause any future spouse to execute and deliver to the Company a
signed counterpart of the spousal consent attached to this Agreement as Exhibit
C.
(k) Further Assurances. Each party to this Agreement agrees to
perform any further acts and to execute and deliver any further documents that
may be reasonably necessary to carry out the provisions of this Agreement,
including without limitation any voting trust agreement or irrevocable proxy,
that may be required to secure performance of any Shareholder's duties under
this Agreement or assure the legal, binding effect of the provisions of this
Agreement under the Florida General Corporation Act in each case as the same may
from time to time be amended.
13
<PAGE> 17
IN WITNESS WHEREOF, the parties to this Agreement have signed this
Agreement as of the day and year first above written.
DYNACS ENGINEERING COMPANY INC.,
a Florida corporation
By: /s/ Ramendra P. Singh
-------------------------------------
Ramendra P. Singh
Its: President
THE EXISTING SHAREHOLDERS
/s/ Ramendra P. Singh
----------------------------------------
Ramendra P. Singh
----------------------------------------
Peter Likins
----------------------------------------
Robert Skelton
/s/ Javier E. Benavente
----------------------------------------
Javier E. Benavente
/s/ Javant Ramakrishnan
----------------------------------------
Javant Ramakrishnan
/s/ Harry W. Shubele III
----------------------------------------
Harry W. Shubele III
/s/ Ravi Venugopal
----------------------------------------
Ravi Venugopal
----------------------------------------
Ramesh Venugopal
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
14
<PAGE> 18
IN WITNESS WHEREOF, the parties to this Agreement have signed this
Agreement as of the day and year first above written.
DYNACS ENGINEERING COMPANY INC.,
a Florida corporation
By: /s/ Ramendra P. Singh
-------------------------------------
Ramendra P. Singh
Its: President
THE EXISTING SHAREHOLDERS
----------------------------------------
Ramendra P. Singh
/s/ Peter Likins
----------------------------------------
Peter Likins
----------------------------------------
Robert Skelton
----------------------------------------
Javier E. Benavente
----------------------------------------
Javant Ramakrishnan
----------------------------------------
Harry W. Shubele
----------------------------------------
Ravi Venugopal
----------------------------------------
Ramesh Venugopal
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
14
<PAGE> 19
IN WITNESS WHEREOF, the parties to this Agreement have signed this
Agreement as of the day and year first above written.
DYNACS ENGINEERING COMPANY INC.,
a Florida corporation
By: /s/ Ramendra P. Singh
-------------------------------------
Ramendra P. Singh
Its: President
THE EXISTING SHAREHOLDERS
----------------------------------------
Ramendra P. Singh
----------------------------------------
Peter Likins
/s/ Robert Skelton
----------------------------------------
Robert Skelton
----------------------------------------
Javier E. Benavente
----------------------------------------
Javant Ramakrishnan
----------------------------------------
Harry W. Shubele
----------------------------------------
Ravi Venugopal
----------------------------------------
Ramesh Venugopal
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
14
<PAGE> 20
IN WITNESS WHEREOF, the parties to this Agreement have signed this
Agreement as of the day and year first above written.
DYNACS ENGINEERING COMPANY INC.,
a Florida corporation
By: /s/ Ramendra P. Singh
-------------------------------------
Ramendra P. Singh
Its: President
THE EXISTING SHAREHOLDERS
----------------------------------------
Ramendra P. Singh
----------------------------------------
Peter Likins
----------------------------------------
Robert Skelton
----------------------------------------
Javier E. Benavente
----------------------------------------
Javant Ramakrishnan
----------------------------------------
Harry W. Shubele
----------------------------------------
Ravi Venugopal
/s/ Ramesh Venugopal
----------------------------------------
Ramesh Venugopal
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
14
<PAGE> 21
[SIGNATURES CONTINUED]
INVESTORS
/s/ Michael Burns
----------------------------------------
Michael Burns
----------------------------------------
William Dallas
----------------------------------------
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By: ____________________________________
Its: ___________________________________
15
<PAGE> 22
[SIGNATURES CONTINUED]
INVESTORS
----------------------------------------
Michael Burns
/s/ William Dallas
----------------------------------------
William Dallas
----------------------------------------
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By: ____________________________________
Its: ___________________________________
15
<PAGE> 23
[SIGNATURES CONTINUED]
INVESTORS
----------------------------------------
Michael Burns
----------------------------------------
William Dallas
/s/ Jon Feltheimer
----------------------------------------
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By: ____________________________________
Its: ___________________________________
15
<PAGE> 24
[SIGNATURES CONTINUED]
INVESTORS
----------------------------------------
Michael Burns
----------------------------------------
William Dallas
----------------------------------------
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By: /s/
-------------------------------------
Its: ___________________________________
15
<PAGE> 25
SPOUSAL CONSENT
The undersigned, Laurie Demarest, acknowledges that she has read the
foregoing dated as of August 13, 1999 (the "Agreement"), and she knows the
contents thereof. The undersigned is aware that by the provisions of the
Agreement she agrees to sell a portion or all shares of Common Stock of Dynacs
Engineering Company, Inc., a Florida corporation (referred to in the Agreement
as the "Company"), including any interest she may have in such shares (marital
or otherwise), if any, which would be equivalent to a spousal interest by virtue
of her relationship with Jon Feltheimer, upon the occurrence of certain events,
and the undersigned hereby consents to such sale and agrees to be bound by each
and every provision of the Agreement.
/s/ Laurie Demarest
----------------------------------------
Name:
<PAGE> 26
SPOUSAL CONSENT
The undersigned, BJ. Dallas acknowledges that she has read the foregoing
dated as of August 13, 1999 (the "Agreement"), and she knows the contents
thereof. The undersigned is aware that by the provisions of the Agreement she
agrees to sell a portion or all shares of Common Stock of Dynacs Engineering
Company, Inc., a Florida corporation (referred to in the Agreement as the
"Company"), including any interest she may have in such shares (marital or
otherwise), if any, which would be equivalent to a spousal interest by virtue of
her relationship with William Dallas, upon the occurrence of certain events, and
the undersigned hereby consents to such sale and agrees to be bound by each and
every provision of the Agreement.
/s/ Beverly J. Dallas
----------------------------------------
Name:
<PAGE> 27
EXHIBIT B
INVESTORS
----------------------------------------
Michael Burns
----------------------------------------
William Dallas
----------------------------------------
Jon Feltheimer
----------------------------------------
Offense Group Associates, LP
----------------------------------------
Exhibit B
<PAGE> 28
EXHIBIT C
SPOUSAL CONSENT
The undersigned, ______________________ acknowledges that she has read the
foregoing Shareholders Agreement, dated as of________________ 1999 (the
"Agreement"), and she knows the contents thereof. The undersigned is aware that
by the provisions of the Agreement she agrees to sell a portion or all shares of
Common Stock of Dynacs Engineering Company, Inc., a Florida corporation
(referred to in the Agreement as the "Company"), including any interest she may
have in such shares (marital or otherwise), if any, which would be equivalent to
a spousal interest by virtue of her relationship with _____________, upon the
occurrence of certain events, and the undersigned hereby consents to such sale
and agrees to be bound by each and every provision of the Agreement.
----------------------------------------
Name:
Exhibit C
<PAGE> 1
Exhibit 10.14
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement"), is made and entered
into as of August 13, 1999, by and among DYNACS ENGINEERING COMPANY, INC., a
Florida corporation (the "Corporation"), and those stockholders whose names
appear on the signature page to this Agreement (collectively referred to in this
Agreement as the "Stockholders" and each as a "Stockholder").
RECITALS
A. The Corporation and the Stockholders are parties to that certain
Contribution and Exchange Agreement, dated as of August 12, 1999 (the
"Contribution Agreement"), which agreement provides for, among other things, the
issuance by Cerulean FXs, Inc., a Florida corporation ("FX") of shares of its
common stock, par value $0.01 per share (the "FX Common Stock") to the
Corporation and each of the Stockholders in exchange for the contribution by the
Corporation and each of the Stockholders of their limited liability company
interests in Cerulean Colorization, L.L.C., a Delaware limited liability
company.
B. Concurrent with the execution and delivery of this Agreement, the
Corporation and the Stockholders are entering into that certain Exchange
Agreement (the "Exchange Agreement"), which agreement grants to the Stockholders
the right to exchange their shares of FX Common Stock for shares of common
stock, par value $.001 per share, of the Corporation (the "Common Stock") upon
the occurrence of certain events.
C. In connection with the transactions contemplated by the Contribution
Agreement and the Exchange Agreement, the parties to this Agreement have agreed
that the Corporation will provide to each of the Stockholders certain
registration rights, as set forth in this Agreement. The execution and delivery
of this Agreement by each of the parties to this Agreement are conditions
precedent to the closing of the Contribution Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of foregoing premises and of the mutual
covenants and agreements contained in this Agreement, on the terms and subject
to the conditions set forth in this Agreement, the parties to this Agreement
agree as follows:
1. Definitions.
(a) Definitions. Capitalized terms used in this Agreement and not
defined in this Agreement shall have the meanings given those terms in the
Exchange Agreement. Otherwise, the following terms have the following meanings,
unless the context otherwise requires:
"Commission" means the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
<PAGE> 2
"Existing Stockholders" means Ramen Singh, Peter Likins, Robert
Skelton, Javier Benavente, Jayant Ramakrishnan, Harry Schubele, Ravi
Venugopal and Ramesh Venugopal.
"Other Holder" shall have the meaning given such term in Section 2
of this Agreement.
"Person" means any individual, corporation, partnership, firm, joint
venture, association, joint-stock company, trust, incorporated
organization or other entity.
"Prospective Seller" shall have the meaning given such term in
Section 4(a) of this Agreement.
"Registrable Stock" means (a) any and all Securities acquired or to
be acquired by any of the Stockholders under and pursuant to the
Contribution Agreement and the Exchange Agreement, and any and all
Securities issued under this clause (a) acquired by a Stockholder from any
other Stockholder; (b) any Securities issued or issuable with respect to
the securities described in clause (a) above by reason of a share dividend
or share split or similar transaction, or in connection with a combination
of shares, recapitalization, merger, consolidation, other reorganization
or other transaction, and (c) any other Securities now held or acquired
after the date of this Agreement by Persons holding the Securities
described in clauses (a) or (b) above. As to any particular Registrable
Stock, such securities shall cease to be Registrable Stock when (w) a
registration statement with respect to the sale of such securities shall
have become effective under the Securities Act and such securities shall
have been disposed of in accordance with such registration statement, (x)
such securities shall have been sold as permitted by Rule 144 or Rule 144A
(or any successor provisions) promulgated under the Securities Act, (y)
such securities shall have been otherwise transferred, new certificates
for them not bearing a legend restricting further transfer shall have been
delivered by the Company and subsequent public distribution of them shall
not require registration under the Securities Act, or (z) such securities
are eligible for sale pursuant to Rule 144 promulgated under the
Securities Act without limitation as to the amount of securities to be
sold.
The terms "register", "registered" and "registration" each refer to
a registration of securities effected by preparing and filing a
Registration Statement as to the securities in compliance with the
Securities Act, and the subsequent effectiveness of the Registration
Statement.
"Registration Statement" means a registration statement filed by the
Corporation with the Commission under the Securities Act (other than a
registration statement on Form S-4 or S-8 or any successor or similar
forms, or a registration statement on any form filed in connection with an
exchange offer or an offering of securities solely to the Company's
existing shareholders).
"Securities" means any equity securities of the Corporation. Any
beneficial interests in the Securities are referred to in this Agreement
as "shares" of the Securities.
2
<PAGE> 3
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Registration" means any registration of shares of any
Securities of any class of the Corporation, whether for its own account or
the account of another, effected pursuant to a Registration Statement.
(b) Rules of Construction. The following rules of construction shall
apply in interpreting this Agreement:
(i) A Person shall be deemed to be a holder of Registrable Stock
when such Person has, or will have on or prior to the date any Securities
are registered, an exercisable right to acquire Registrable Stock. Each
share of Registrable Stock shall continue to be Registrable Stock in the
hands of each subsequent holder of the Registrable Stock; and for purposes
of this Agreement, the term "Stockholders" shall be deemed to include each
subsequent holder of Registrable Stock, and each of these holders shall
have the right to exercise any and all rights granted under this Agreement
to the Stockholders.
(ii) This Agreement has been entered into concurrently with the
execution of the Exchange Agreement and the Contribution Agreement, and,
unless the context otherwise clearly requires, this Agreement shall be
construed in a manner consistent with the provisions of the Exchange
Agreement and the Contribution Agreement.
2. Registration. If the Corporation at any time proposes to register any
securities pursuant to a Securities Registration, it shall each time give
written notice of the proposed Securities Registration (the "Corporation's
Notice"), at its expense, to each of the Stockholders and to all other holders
of securities of the Corporation who have the contractual right to include all
or any portion of their shares in the registration on a "piggyback" basis (the
"Other Holders") at least 15 days prior to the filing of a Registration
Statement with respect to the Securities Registration with the Commission. Upon
written request of any of the Stockholders (each, a "Stockholder's Notice") or
Other Holder (a "Holder's Notice") given within 15 days after receipt of the
Corporation's Notice, stating the number of shares of Registrable Stock to be
disposed of by the Stockholder delivering the Stockholder's Notice, or the
number of shares of Securities to be disposed of by the Other Holder delivering
the Holder's Notice, the Corporation shall use its best efforts to cause all
shares of Registrable Stock specified in each Stockholder's Notice, or shares of
Securities specified in each Holder's Notice, to be registered under the
Securities Act so as to permit the sale or other disposition (in accordance with
the intended methods as set forth in the Corporation's Notice) of the shares,
subject, however, to the limitations set forth in Section 3 of this Agreement;
provided, however, that the Corporation shall have the right in its sole and
absolute discretion to elect not to file, postpone or withdraw any registration
effected pursuant to this Section 2 without obligation to the Stockholders or
Other Holders except as provided in this Section 2; and provided, further, that
the Stockholders' and Other Holders' rights to include all or any portion of
their shares in an underwritten offering shall be subject to the right of the
managing underwriters in the offering to exclude such shares as provided in
Section 3 of this Agreement.
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<PAGE> 4
3. Limitations on Securities Registration
(a) Underwritten Offerings. If any Securities Registration is for an
underwritten offering, only securities of the class and series which are to be
included in the underwriting may be included in the registration, the issuance
and sale of securities by the Corporation shall have priority as to sales to and
by the underwriters in the registration, and the Stockholders hereby agree that
they shall withdraw their securities from the registration if and to the extent
requested to do so in good faith by the managing underwriters of the offering to
facilitate the complete sale of the securities being registered. In connection
with an underwritten offering, the Corporation shall not be required to include
any Registrable Stock in such offering unless the Stockholders accept the terms
of the underwriting as agreed upon between the Corporation and the underwriters
selected by the Corporation and execute an underwriting agreement reflecting
such terms (provided that such terms are consistent with this Agreement), and
then only in such quantity as will not, in the good faith opinion of the
managing underwriter, jeopardize the success of the offering by the Corporation.
(b) Scale-Back Procedures. Whenever the number of shares which may
be registered pursuant to Section 2 of this Agreement is limited by the
provisions of Section 3(a), above, the Corporation will include in the
registration (i) first, the securities the Corporation proposes to sell, and
(ii) second, the securities requested to be sold pro rata among the Stockholders
and all Other Holders, allocated on the basis of the number of shares owned by
each; provided, that if any Stockholder or Other Holder would thus be entitled
to include more shares than the Stockholder or Other Holder requested to be
registered, the excess will be allocated to the other Stockholders and Other
Holders, until the full amount of shares requested by any Stockholder or Other
Holder has been registered for sale. The Corporation shall use its best efforts
to cause any other affected holders to withdraw from the registration to the
extent necessary to comply with the foregoing priority provisions.
4. Registration Procedures.
(a) Obligations of the Corporation. If and whenever the Corporation
is required by the provisions of this Agreement to use its best efforts to
effect the registration of shares (as used in this Section 4, the "Shares") of
Registrable Stock held by any Person (each, a "Prospective Seller") under the
Securities Act, the Corporation shall:
(i) prepare and file with the Commission a Registration Statement
with respect to the Shares and use its best efforts to cause the
Registration Statement to become and remain effective as provided in this
Agreement;
(ii) prepare and file with the Commission any amendments and
supplements to the Registration Statement and the prospectuses used in
connection with the Registration Statement as may be necessary to keep the
Registration Statement effective and current, in the case of a firm
commitment underwritten public offering, until each underwriter has
completed the distribution of all securities purchased by it and, in the
case of any other offering, until the earlier of the sale of all Shares
covered thereby or 90 days after the effective date of the Registration
Statement, and to comply with the provisions of the Securities Act
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<PAGE> 5
with respect to the sale or other disposition of all Shares covered by the
Registration Statement
(iii) furnish to each Prospective Seller the number of copies of
each prospectus, including preliminary prospectuses, in conformity with
the requirements of the Securities Act, and all other documents, as the
Prospective Seller may reasonably request in order to facilitate the
public sale or other disposition of the Shares owned by the Prospective
Seller;
(iv) use its best efforts to register or qualify the Shares covered
by the Registration Statement under the other securities or blue sky or
other applicable laws of the jurisdictions as each Prospective Seller
shall reasonably request, to enable each Prospective Seller to consummate
the sale or other disposition of the Shares owned by the Prospective
Seller;
(v) furnish to each Prospective Seller a signed counterpart,
addressed to the Prospective Seller and his or its underwriters, if any,
of
(A) an opinion of counsel for the Corporation, dated the effective
date of the Registration Statement and, if requested, the date of each
closing of sales pursuant to the registration, with respect to the
effective registration of such Shares; and
(B) if and to the extent then available under FASB and related
pronouncements, a "comfort" letter signed by the independent public
accountants who have certified the Corporation's financial statements
included in the Registration Statement, similarly dated;
covering substantially the same matters with respect to the Registration
Statement (and the prospectuses included in the Registration Statement)
and (in the case of the accountants' letter) with respect to the events
subsequent to the date of the financial statements, as are customarily
covered (at the time of the registration) in the opinions of issuers'
counsel and in accountants' letters delivered to the underwriters in
connection with underwritten public offerings of securities;
(vi) cause all Shares to be listed on each securities exchange on
which similar securities issued by the Corporation are then listed;
(vii) provide a transfer agent and registrar for all Shares not
later than the effective date of the Registration Statement;
(viii) enter into all customary agreements (including an
underwriting agreement in customary form) and take all customary actions
as the Member Representative may reasonably request in order to expedite
or facilitate the disposition of the Shares;
(ix) use its best efforts to cause the Corporation's officers,
directors and employees to supply all information reasonably requested in
connection with the registration
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<PAGE> 6
by any Prospective Seller, any underwriter participating in any
disposition pursuant to the Registration Statement, and any attorney,
accountant or other agent retained by any Prospective Seller or
underwriter, including, without limitation, all financial and other
records, pertinent corporate documents and properties of the Corporation;
(x) notify each Prospective Seller at any time when a prospectus
relating to Shares covered by the Registration Statement is effective, of
the happening of any event as a result of which the prospectus included in
the Registration Statement, as then in effect, includes an untrue
statement of a material fact or omits to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing. The Corporation
shall use its reasonable efforts promptly to amend or supplement the
Registration Statement to correct any such untrue statement or omission;
and
(xi) notify each Prospective Seller of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or the initiation of any proceedings for that
purpose. The Corporation will make every reasonable effort to prevent the
issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible time.
(b) Obligations of the Prospective Sellers. In connection with the
registration of Shares held by a Prospective Seller, the Prospective Seller
shall:
(i) furnish to the Corporation all information the Corporation
may reasonably require from the Prospective Seller for inclusion in the
Registration Statement (and the prospectus included in the Registration
Statement); and
(ii) upon notification by the Corporation of a state of facts
described in Section 4(a)(x) or of a stop order referenced in Section 4(a)(xi),
cease making sales of Shares unless and until the Corporation shall notify the
Prospective Seller that the state of facts has been corrected and/or the stop
order has been lifted.
5. Expenses of Registration. All expenses incurred in effecting any
registration under this Agreement, including, without limitation, all
registration and filing fees, printing expenses, expenses of compliance with
blue sky laws, fees and disbursements of counsel for the Corporation, fees and
disbursements of counsel for the Prospective Sellers (but not more than one
counsel representing all of the Stockholders who are Prospective Sellers), and
expenses of any audits incidental to or required by any registration
("Registration Expenses") shall be borne by the Corporation; provided, that all
underwriting discounts or brokerage fees or commissions relating to the sale of
the securities included in the registration shall be separately borne by the
sellers of the securities.
6. Indemnification
(a) Indemnity. In the event of any registration of any of its
securities under the Securities Act pursuant to this Agreement, the Corporation
shall indemnify and hold harmless each
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<PAGE> 7
Prospective Seller, each underwriter (as defined in the Securities Act) and each
controlling person (within the meaning of the Securities Act), if any, of any
Prospective Seller or underwriter (collectively, "Indemnified Parties" or an
"Indemnified Party"), against any losses, claims, damages or liabilities, joint
or several (or actions in respect thereof), to which the Indemnified Parties may
be subject under the Securities Act or any other statute or at common law,
insofar as the losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon (i) any untrue statement (or alleged
untrue statement) of any material fact contained in any Registration Statement
under which the securities were registered under the Securities Act, any
preliminary prospectus or final prospectus contained in the Registration
Statement, or any summary prospectus issued in connection with any securities
being registered, or any amendment or supplement thereto, or any other document
used to sell the securities, or (ii) any omission (or alleged omission) to state
in any Registration Statement under which the securities were registered under
the Securities Act, any preliminary prospectus or final prospectus contained in
the Registration Statement, or any summary prospectus issued in connection with
any securities being registered, or any amendment or supplement thereto, or any
other document or any other document used to sell the securities, a material
fact required to be stated therein or necessary to make the statements therein
not misleading, or (iii) any violation of the Securities Act or any Blue Sky
law, or any rule or regulation promulgated under the Securities Act or any Blue
Sky law, or any other law, in connection with any registration, qualification or
compliance, and shall reimburse the Indemnified Parties for any legal or other
expenses incurred by the Indemnified Parties in connection with investigating or
defending any loss, claim, damage, liability or action described above;
provided, however, that the Corporation shall not be liable to any Indemnified
Party (i) to the extent that any loss, claim, damage or liability arises out of
or is based upon any untrue statement or omission made in the Registration
Statement, preliminary prospectus, summary prospectus, prospectus, or amendment
or supplement thereto, or any other document used to sell the securities, in
reliance upon and in conformity with information furnished to the Corporation by
that Indemnified Party, or party controlling or controlled by that Indemnified
Party within the meaning of the Securities Act specifically for use in the
registration, or (ii) to the extent that any such loss, claim, damage, or
liability does not arise out of or is not based upon any untrue statement or
omission made in such Registration Statement, if any Indemnified Person who
participates as an underwriter in the offering, or who controls an underwriter
in the offering, failed to give or send a final prospectus at or prior to
written confirmation of sale. The indemnity provided for in this Section 6(a)
shall remain in full force and effect regardless of any investigation made by or
on behalf of any Indemnified Party and shall survive transfer of the securities
by the Indemnified Party.
(b) Prospective Sellers. In the event of any registration of any of
the Corporation's securities under the Securities Act in which a Prospective
Seller participates pursuant to this Agreement, each participating Prospective
Seller agrees to indemnify and hold harmless the Corporation, its directors,
each underwriter (as defined in the Securities Act) and each controlling person
(within the meaning of the Securities Act) of the Corporation or underwriter, if
any, against any losses, claims, damages or liabilities, joint or several (or
actions in respect thereof), to which the Corporation, director, underwriter or
controlling person may be subject under the Securities Act, under any other
statute or at common law, insofar as the losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon any untrue
statement (or alleged untrue statement) of any material fact contained in any
Registration Statement under which the securities were registered under the
Securities Act, any preliminary prospectus or final prospectus contained
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<PAGE> 8
in the Registration Statement, or any summary prospectus issued in connection
with any securities being registered, or any amendment or supplement thereto, or
any other document used to sell the securities, or any omission (or alleged
omission) to state in the Registration Statement, any preliminary prospectus or
final prospectus contained in the Registration Statement, or any summary
prospectus issued in connection with any securities being registered, or any
amendment or supplement thereto, or any other document or any other document
used to sell the securities, a material fact required to be stated therein or
necessary to make the statements therein not misleading, and shall reimburse the
Corporation, its directors, each underwriter, and each controlling person, for
any legal or other expenses reasonably incurred by these persons in connection
with investigating or defending any loss, claim, damage, liability or action; in
each case, to the extent, and only to the extent, that the untrue statement or
omission is contained in any information or affidavit furnished in writing to
the Corporation by the Prospective Seller specifically for use in the
registration. The indemnity provided for in this Section 6(b) shall survive
transfer of the securities by the Prospective Seller.
(c) Contribution. If the indemnification provided for in Section
6(a) or (b) is unavailable to an indemnified party in accordance with its terms
in respect of any losses, claims, damages or liabilities referred to in Section
6(a) or (b), then the indemnitor in lieu of indemnifying the indemnified party
under Section 6(a) or (b) shall contribute to the amount paid or payable by the
indemnified party as a result of the losses, claims, damages or liabilities, in
such proportion as is appropriate to reflect the relative fault of the
indemnitor on the one hand and of the indemnified parties on the other in
connection with the statements or omissions which resulted in the losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the indemnitor and of the indemnified
parties shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission to state a
material fact relates to information supplied by the indemnitor, or the
indemnified parties, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent the statement or omission.
The Corporation and the other parties to this Agreement agree
that it would not be just and equitable if contribution pursuant to this Section
6(c) were determined by a mechanical pro rata allocation or by any other method
of allocation which does not take account of the equitable considerations
referred to in the immediately preceding paragraph. The amount paid or payable
by any indemnified party as a result of the losses, claims, damages and
liabilities or actions in respect thereof referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by the indemnified
party in connection with investigating or defending the action or claim.
Notwithstanding the provisions of this Section 6(c), no holder of Registrable
Stock, no underwriter of Registrable Stock, and no controlling party of any of
them, shall be required to contribute any amount in excess of the amount by
which the total price at which the Registrable Stock was sold exceeds the amount
of any damages which the Person has otherwise been required to pay and has
actually paid by reason of the untrue or alleged untrue statement or omission or
alleged omission. No person guilty of a fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who was not guilty of the fraudulent
misrepresentation.
(d) Procedures. Promptly after receipt by any Indemnified Party of a
complaint, claim or other written notice of any loss, claim, damage, liability
or action arising rise to a claim for
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<PAGE> 9
indemnification under this Section 6, the party claiming indemnification under
this Section 6 shall notify the indemnifying party of the complaint, notice,
claim or action, and the indemnifying party shall have the right to investigate
and defend the loss, claim, damage, liability or action; provided, that the
failure of the Indemnified Party to promptly notify the indemnifying party shall
not relieve the indemnifying party from any liability which it may have to the
Indemnified Party otherwise than under Section 6, or under Section 6 to the
extent that the indemnifying party has not been materially prejudiced as a
proximate result of the failure to provide notice. The Indemnified Party shall
have the right to employ separate counsel in the action and to participate in
the defense of the action, but the fees and expenses of the counsel shall not be
at the expense of the indemnifying party. If the defendants in any action shall
include more that one Indemnified Party, and any of these Indemnified Parties
shall reasonably conclude that counsel selected by the Corporation has a
conflict of interest which under the Rules of Professional Conduct of the
Florida State Bar Association (or other body regulating the practice of law in
the State of Florida) would prohibit the representation because of the
availability of different or additional defenses to any of the Indemnified
Parties, the Indemnified Party shall have the right to select separate counsel
reasonably acceptable to the Corporation to participate in the defense of the
claim on its behalf at the expense of the indemnifying party who would otherwise
be liable for the losses under this Section 6, it being understood, however,
that the indemnifying party shall not, in connection with any one action or
proceeding or separate but substantially similar or related actions or
proceedings in the same jurisdiction arising out of the same general allegations
or circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys at any time for the Indemnified Parties; provided, however,
that if the parties shall not agree that a conflict of interest between the
Indemnified Parties exists, then the parties shall submit the issue to the State
Bar Association of Florida to determine whether a conflict of interest exists,
and the determination of the State Bar Association of Florida shall be binding
on the parties. The Indemnified Parties shall cooperate fully in the defense of
any claim under this Section 6 and each Indemnified Party shall make available
to the Corporation pertinent information under the Indemnified Party's control
relating to the claim. In no event shall the indemnifying party be obligated to
indemnify any party for any settlement of any claim or action effected without
the indemnifying party's consent.
7. Rights Which May Be Granted to Other Persons. The Corporation shall not
grant any Person registration rights with priority as to registration or sale to
underwriters which are greater than or pari passu to the registration rights
granted to the Stockholders in this Agreement; provided that the Company may
grant registration rights to the Existing Stockholders, or any of them, with
respect to the shares of Common Stock owned by them on the date of this
Agreement, which are pari passu to the registration rights granted to the
Stockholders in this Agreement.
8. Rule 144 Requirements. At all times after the close of business on the
earliest of the date (a) a Registration Statement filed by the Corporation under
the Securities Act becomes effective, (b) the Corporation registers a class of
securities under Section 12 of the Securities Exchange Act of 1934, as amended,
or (c) the Corporation issues an offering circular meeting the requirements of
Regulation A under the Securities Act, the Corporation shall undertake to make
publicly available, and available to the Stockholders, the information that is
necessary to enable the Stockholders to make sales of Registrable Stock pursuant
to Rule 144 of the Commission under the Securities Act. The Corporation shall
from time to time furnish to each of the Stockholders, upon request, a written
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<PAGE> 10
statement executed by the Corporation as to the steps it has taken to comply
with the current public information requirements of Rule 144.
9. Hold-Back Agreements.
(a) By Michael Burns. Michael Burns, a Stockholder, agrees not to
effect any public sale or distribution of Securities, or securities convertible
into or exchangeable or exercisable for Securities, during the seven days prior
to and the period of 180 days. or a longer period (which shall not, in any
event, exceed 270 days) as may be requested by the underwriters, beginning on
the effective date of any Securities Registration which includes a firmly
underwritten offering, except, in each case, as part of the underwritten
offering.
(b) By Corporation and Other Stockholders. The Corporation agrees
(i) not to effect the public sale or distribution of Securities, or of any
securities convertible into or exchangeable or exercisable for any Securities,
during the seven days prior to and the period of 180 days, or a longer period
(which shall not, in any event, exceed 270 days) as may be requested by the
underwriters, beginning on the effective date of any Securities Registration
which includes a firmly underwritten offering, and (ii) to use its best efforts
to cause each holder of Securities, or of any securities convertible into or
exchangeable or exercisable for Securities purchased from the Corporation at any
time on or after the date of this Agreement (other than in a registered public
offering) and who is an officer or director of the Corporation, or owns more
than 5% of any class of its then outstanding Securities, to agree not to effect
any public sale or distribution of any Securities during this period, except as
part of the underwritten offering.
10. Miscellaneous.
(a) Notices. All notices, demands or other communications under this
Agreement shall be in writing and shall be deemed to have been duly given if
delivered in person, or by United States mail, certified or registered, return
receipt requested or otherwise actually delivered:
(i) if to any of the Stockholders, at the address set forth for the
Stockholder on the Corporation's records; and
(ii) if to the Corporation, at the address of the Corporation as set
forth in the Contribution Agreement, marked for attention as therein
indicated;
or such other address as may have been furnished by the Person in writing to the
other parties. Any notice, demand or other communication shall be deemed to have
been given on the date actually delivered or as of the date mailed, as the case
may be.
(b) Severability and Governing Law. Should any Section or any part
of a Section within this Agreement be rendered void, invalid or unenforceable by
any court of law for any reason, the invalidity or unenforceability shall not
void or render invalid or unenforceable any other Section or part of a Section
in this Agreement. This Agreement shall be governed and construed in accordance
with the laws of the State of California applicable to contracts made and to be
performed entirely within the State of California, without regard to principles
of conflicts of law.
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(c) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
(d) No Adverse Construction. The rule that a contract is to be
construed against the party drafting the contract is hereby waived, and shall
have no applicability in construing this Agreement or the terms of this
Agreement.
(e) Captions and Section Headings. Section titles or captions
contained in this Agreement are inserted as a matter of convenience and for
reference purposes only, and in no way define, limit, extend or describe the
scope of this Agreement or the intent of any provision hereof.
(f) Amendments and Waivers. This Agreement may be amended, modified,
superseded, canceled, renewed or extended, and the terms and conditions hereof
may be waived, only by a written instrument signed by all the parties to this
Agreement or, in the case of a waiver, by the party or parties, as the case may
be, waiving compliance. No delay on the part of any party in exercising any
right, power or privilege under this Agreement shall operate as a waiver
thereof, nor shall any waiver on the part of any party of any right, power or
privilege under this Agreement, nor any single or partial exercise of any right,
power or privilege under this Agreement, preclude any other or further exercise
thereof or the exercise of any other right, power or privilege under this
Agreement.
(g) Costs and Attorneys' Fees. In the event that any action, suit or
other proceeding is instituted concerning or arising out of this Agreement, the
prevailing party shall be entitled to recover all of the prevailing party's
costs and reasonable attorneys' fees incurred in each and every such action,
suit, or other proceedings, including any and all appeals or petitions
therefrom.
(h) Successors and Assigns. Except as otherwise provided in this
Agreement, all rights, covenants and agreements of the parties contained in this
Agreement shall be binding upon and inure to the benefit of their respective
successors and permitted assigns.
(i) Specific Performance. The parties hereto agree that the
securities of the Corporation cannot be purchased or sold in the open market and
that, for these reasons, among others, the parties will be irreparably damaged
in the event that this Agreement is not specifically enforceable. Accordingly,
in the event of any controversy concerning the securities which are the subject
of this Agreement, or any right or obligation to register the securities, such
right or obligation shall be enforceable in a court of equity by specific
performance. The rights granted in this Section 10(i) shall be cumulative and
not exclusive, and shall be in addition to any and all other rights which the
parties to this Agreement may have under this Agreement, at law or in equity.
(j) Entire Agreement. This Agreement, the Contribution Agreement,
and the other agreements delivered in connection with the Contribution
Agreement, collectively contain the entire understanding of the parties, and
there are no further or other agreements or understandings, written or oral, in
effect between the parties relating to the subject matter of this Agreement
unless expressly referred to in this Agreement.
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<PAGE> 12
(k) Agreement to Perform Required Acts. Each party to this Agreement
agrees to perform any further acts and to execute and deliver any further
documents that may be reasonably necessary to carry out the provisions of this
Agreement, that may be required to secure performance of any party's duties
under this Agreement or that may be required to assure the legal and binding
effect of the provisions of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first above written.
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By: /s/ Ramendra P. Singh
-------------------------------------
Dr. Ramendra P. Singh
Its: President
STOCKHOLDERS:
________________________________________
Michael Burns
________________________________________
William Dallas
________________________________________
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By:_____________________________________
Its:____________________________________
13
<PAGE> 14
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first above written.
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By:_____________________________________
Dr. Ramendra P. Singh
Its: President
STOCKHOLDERS:
/s/ Michael Burns
----------------------------------------
Michael Burns
________________________________________
William Dallas
________________________________________
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By:_____________________________________
Its:____________________________________
13
<PAGE> 15
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first above written.
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By:_____________________________________
Dr. Ramendra P. Singh
Its: President
STOCKHOLDERS:
________________________________________
Michael Burns
/s/ William Dallas
----------------------------------------
William Dallas
________________________________________
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By:_____________________________________
Its:____________________________________
13
<PAGE> 16
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first above written.
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By:_____________________________________
Dr. Ramendra P. Singh
Its: President
STOCKHOLDERS:
________________________________________
Michael Burns
________________________________________
William Dallas
/s/ Jon Felthiemer
----------------------------------------
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By:_____________________________________
Its:____________________________________
13
<PAGE> 17
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first above written.
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By:_____________________________________
Dr. Ramendra P. Singh
Its: President
STOCKHOLDERS:
________________________________________
Michael Burns
________________________________________
William Dallas
/s/ Jon Felthiemer
----------------------------------------
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By: /s/
-------------------------------------
Its:____________________________________
13
<PAGE> 1
Exhibit 10.15
EXCHANGE AGREEMENT
THIS EXCHANGE AGREEMENT (this "Agreement"), is made and entered into as of
August 13, 1999, by and among DYNACS ENGINEERING COMPANY, INC. a Florida
corporation (the "Company"), RAMENDRA P. SINGH, an existing stockholder of the
Company (the "Existing Stockholder"), MICHAEL BURNS ("Burns"), WILLIAM DALLAS
("Dallas"), JON FELTHEIMER ("Feltheimer") and OFFENSE GROUP ASSOCIATES, LP
("OGA") (Burns, Dallas, Feltheimer and OGA are sometimes collectively referred
to in this Agreement as the "Investors" and each as an "Investor").
RECITALS
A. The Company and the Investors are parties to that certain Contribution
and Exchange Agreement, dated as of August 12, 1999 (the "Contribution
Agreement") which agreement provides for, among other things, the issuance by
Cerulean FXs, Inc., a Florida corporation ("FX") of 80,000 shares of its common
stock, par value $0.01 per share (the "FX Common Stock") to the Company and the
issuance of an aggregate of 20,000 shares of FX Common Stock to the Investors in
exchange for the contribution by the Company and each of the Investors of
certain securities owned by them.
B. In connection with the Contribution Agreement, the Company and the
Investors have agreed to provide for the exchange of their shares of FX Common
Stock for shares of common stock, par value $.001 per share, of the Company (the
"Company Common Stock") upon the occurrence of certain events, all as set forth
in this Agreement. The execution and delivery of this Agreement by each of the
parties to this Agreement are conditions precedent to the closing of the
Contribution Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of foregoing premises and of the mutual
covenants and agreements contained in this Agreement, on the terms and subject
to the conditions set forth in this Agreement, the parties to this Agreement
agree as follows:
1. Definitions. Capitalized terms used in this Agreement and not defined
in this Agreement shall have the meanings given those terms in the Contribution
Agreement. Otherwise, the following terms have the following meanings, unless
the context otherwise requires:
"Affiliate" means, with respect to a specified Person, any Person
that directly or indirectly through one or more intermediaries controls or is
controlled by, or is under common control with, the specified Person.
"Commission" means the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
<PAGE> 2
"Exchange" means the issuance of the Exchange Shares in exchange for
all of the FX Shares as provided in this Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Shares" means the shares of Company Common Stock to be
issued to the Holders at the closing of the Exchange.
"Family Member" means, with respect to any Person, any descendant of
the grandfather of the Person, the Person's spouse or any descendant of the
grandfather of the Person's spouse.
"Holder" or "Holders" means, prior to the Exchange, any holder of
record of the FX Shares and, following the Exchange, any holder of record of the
Exchange Shares.
"Liquidation Event" means the occurrence of any of the following:
(i) the Company voluntarily or involuntarily dissolves, liquidates or winds up
its affairs; (ii) the Company becomes insolvent or makes a general assignment
for the benefit of creditors; (iii) a petition in bankruptcy is filed by the
Company or against the Company and not opposed by the Company; (iv) the Company
is adjudicated a bankrupt or insolvent; (v) a bill in equity or other proceeding
for the appointment of a receiver of the Company or other custodian for the
Company's business or assets is filed and consented to by the Company; (vi) a
receiver or other custodian (permanent or temporary) of the Company's assets or
property, or any part thereof is appointed by any court of competent
jurisdiction; or (vii) proceedings for a composition with creditors under any
state or federal law is instituted by or against the Company.
"Member Representative" shall have the meaning given such term in
Section 2.2 of the Contribution Agreement.
"FX Shares" shall consist of the shares of FX Common Stock acquired
by the Investors pursuant to the Contribution Agreement, and any securities
issued by FX with respect to those shares by way of dividend or stock split or
similar transaction, and any securities issued by FX or a successor to FX with
respect to those shares in connection with any recapitalization, merger,
consolidation or other reorganization.
"Optional Exchange Event" means the occurrence of any of (i) a
Qualified Private Placement, (ii) the second anniversary of the date of this
Agreement, (iii) a Sale of Voting Control or (iv) a Liquidation Event.
"Person" means any individual, corporation, partnership, firm, joint
venture, association, joint-stock company, trust, incorporated organization or
other entity.
"pro rata" means, with respect to any determination, that the
determination is based on the relative percentages of shares of Company Common
Stock then held by all of the stockholders of the Company after giving pro forma
effect to the issuance by the Company, and the ownership by
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<PAGE> 3
the Holders, of all of the Exchange Shares at the time the determination is
made, as if all of the Exchange Shares had been then issued.
"Qualified Private Placement" means the closing of a sale by the
Company of any debt and/or equity securities of the Company that (i) does not
constitute a Qualified Public Offering and (ii) raises gross proceeds (proceeds
before discounts, commissions and offering expenses) of at least $5 million.
"Qualified Public Offering" means the closing of (i) an underwritten
public offering of Company Common Stock pursuant to an effective Registration
Statement, or (ii) the merger of the Company with and into another entity
pursuant to which the shareholders of the Company immediately prior to the
effective date of the merger receive, upon consummation of the merger, shares of
voting securities of the surviving entity or its parent that are registered
under the Exchange Act and trade on the New York Stock Exchange, the American
Stock Exchange, the Nasdaq National Market or the Nasdaq SmallCap Market.
"Registration Statement" means a registration statement under the
Securities Act.
"Sale of Voting Control" means any transfer, or series of related
transfers, of shares of Company Common Stock to any Person who, in the aggregate
with all Family Members and Affiliates of such Person, and any other Persons who
are part of a syndicate or group (as defined in Section 13(d)(3) of the Exchange
Act) with such Person, would (after giving effect to the transfer but
disregarding any shares of Company Common Stock held by the Person, his or her
Family Members and Affiliates, and syndicate or group prior to the transfer or
series of related transfers) own shares of Company Common Stock constituting
more than 50% of the voting power of the then issued and outstanding shares of
Company Common Stock (after giving pro forma effect to the issuance by the
Company, and the ownership by the Holders, of all of the Exchange Shares at the
time the determination is made, as if all of the Exchange Shares had been then
issued).
"Securities Act" means the Securities Act of 1933, as amended.
"transfer" means any direct or indirect sale, assignment, transfer.
pledge, hypothecation, gift, encumbrance or other disposition of securities.
2. Exchange.
(a) Optional Exchange by the Holders. Each of the FX Shares may be
exchanged, together with all other FX Shares and not in part, at the option of
the Member Representative at any time on the date of or subsequent to an
Optional Exchange Event, for that number of fully paid and non-assessable shares
of Company Common Stock determined in accordance with the provisions of Section
4 of this Agreement. If the Member Representative desires to exchange the FX
Shares for Company Common Stock pursuant to this Section 2(a), the Member
Representative shall have written notice to the Company pursuant to the
provisions of Section 3 below. The closing of the Exchange will take place at
the time and place and in the manner set forth in Section 5 below.
Notwithstanding the later closing of the Exchange, the effective date of the
Exchange will be the date notice is first given by the Member Representative to
the Company in accordance with Section 3 below, and the
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<PAGE> 4
Holders entitled to receive the Exchange Shares issuable upon the Exchange will
be treated for all purposes as the record holders of the Exchange Shares on that
date.
(b) Optional Exchange by the Company. Each of the FX Shares may be
exchanged, together with all other FX Shares and not in part, at the option of
the Company at any time on or subsequent to the fifth anniversary of the date of
this Agreement, for that number of fully paid and non-assessable shares of
Company Common Stock determined in accordance with the provisions of Section 4
of this Agreement. If the Company desires to exchange Company Common Stock for
the FX Shares pursuant to this Section 2(b), the Company shall give written
notice to the Member Representative pursuant to the provisions of Section 3
below. The closing of the Exchange will take place at the time and place and in
the manner set forth in Section 5 below. Notwithstanding the later closing of
the Exchange, the effective date of the Exchange will be the date notice is
first given by the Company to the Member Representative in accordance with
Section 3 below, and the Holders entitled to receive the Exchange Shares
issuable upon the Exchange will be treated for all purposes as the record
holders of the Exchange Shares on that date.
(c) Automatic Exchange. Each of the FX Shares then outstanding will
be automatically exchanged, without election or further action by the Company or
the holders of the FX Shares, for the number of fully paid and non-assessable
shares of Company Common Stock determined in accordance with the provisions of
Section 4 of this Agreement, upon the effective date of a Registration Statement
filed by the Company with the Commission in connection with a Qualified Public
Offering. The Company shall give notice of the Exchange under this Section 2(c)
to the Member Representative in accordance with Section 3 below. The closing of
the Exchange will take place at the time and place and in the manner set forth
in Section 5 below. Notwithstanding the later closing of the Exchange, the
effective date of the Exchange will be the date the Registration Statement for
the Qualified Public Offering is declared effective by the Commission, and the
Holders entitled to receive the Exchange Shares issuable upon the Exchange will
be treated for all purposes as the record holders of the Exchange Shares on that
date.
(d) Fractional Shares. No fractional shares of Company Common Stock
will be issued upon the exchange of the FX Shares. If any fractional shares of
Company Common Stock would, except for the provisions of this Section 2(d), be
deliverable upon the exchange of any FX Shares the Company will, in lieu of
delivering the fractional share therefor, adjust the fractional interest by
rounding up the number of Exchange Shares to be issued to the Holder to the
nearest whole share.
(e) Reservation of Stock. The Company will at all times reserve and
keep available out of its authorized but unissued shares of Company Common
Stock, solely for the purpose of effecting the Exchange, the number of shares of
Company Common Stock as shall from time to time be sufficient to effect the
Exchange, and if at any time the number of authorized but unissued shares of
Company Common Stock shall not be sufficient to effect the Exchange. the Company
will promptly seek what corporate action may, in the opinion of its counsel, be
necessary to increase its authorized but unissued shares of Company Common Stock
to the number of shares as shall be sufficient for the purpose of effecting the
Exchange. In the event of the consolidation or merger of the Company with
another corporation where the Company is not the surviving corporation,
provision shall be made in the documents of merger or consolidation, or
otherwise, of the surviving
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<PAGE> 5
corporation so that the surviving corporation will at all times reserve and keep
available a sufficient number of shares of common stock or other securities or
property to provide for the exchange of the FX Shares in accordance with the
provisions of this Section 2.
(f) Payment of Costs and Taxes. The Company shall pay all costs and
expenses of the Exchange, including all taxes, fees and other governmental
charges (other than any income or other taxes imposed upon the profits realized
by the recipient) that may be imposed in respect of the issue or delivery of the
Exchange Shares or other securities or property upon the Exchange, including,
without limitation, any tax or other charge imposed in connection with any
transfer involved in the issue and delivery of Exchange Shares or other
securities in a name other than that in which the FX Shares so exchanged were
registered.
3. Exchange Notice. Notice of the Exchange (the "Exchange Notice") shall
be provided by the Company or the Member Representative as set forth in this
Section 3.
(a) The Member Representative shall elect to consummate the Exchange
pursuant to Section 2(a) of this Agreement by giving the Company written notice
of the election. The notice shall specify the names in which the Holders desire
the certificates for their respective Exchange Shares to be issued.
(b) The Company shall elect to consummate the Exchange pursuant to
Section 2(b) of this Agreement by giving the Member Representative written
notice of the election. Following receipt by the Member Representative of the
notice and prior to the closing of the Exchange, the Member Representative will
provide notice to the Company specifying the names in which the Holders desire
the certificates for their respective Exchange Shares to be issued.
(c) The Company shall provide notice to the Member Representative of
a proposed Qualified Public Offering at least 30 days prior to the date the
Registration Statement for the Qualified Public Offering is first filed by the
Company with the Commission. The notice shall set forth the anticipated
effective date of the Registration Statement. Following receipt by the Member
Representative of the notice and prior to the closing of the Exchange, the
Member Representative will provide notice to the Company specifying the names in
which the Holders desire the certificates for their respective Exchange Shares
to be issued.
4. Exchange Rate.
(a) Initial Exchange Rate. Each of the FX Shares shall be
exchangeable into that number of fully paid and non-assessable shares of Company
Common Stock as is determined by dividing 31.2375 by the "Exchange Rate" (as
defined below) in effect at the time of the exchange. The exchange rate (the
"Exchange Rate") initially will be 1. The initial Exchange Rate will be subject
to adjustment from time to time in certain instances, as provided in Section
4(b) below.
(b) Adjustment to Exchange Rate. The Exchange Rate will be subject
to adjustment from time to time as provided in this Section 4(b).
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<PAGE> 6
(i) Adjustment for Stock Splits and Stock Dividends. If at any
time or from time to time the outstanding shares of Company Common Stock shall
be subdivided into a greater number of shares, or a dividend in Company Common
Stock or other securities of the Company convertible into or exchangeable for
Company Common Stock (in which latter event the number of shares of Company
Common Stock issuable upon the conversion or exchange of such securities shall
be deemed to have been distributed) shall be paid in respect to the Company
Common Stock, the Exchange Rate in effect immediately prior to the subdivision
or at the record date of the dividend will, simultaneously with the
effectiveness of the subdivision or immediately after the record date of the
dividend, be proportionately reduced, and conversely, if the outstanding shares
of Company Common Stock shall be combined into a smaller number of shares, the
Exchange Rate in effect immediately prior to the combination will,
simultaneously with the effectiveness of the combination, be proportionately
increased. Any adjustment to the Exchange Rate under this Section 4(b)(i) will
become effective at the close of business on the date the subdivision or
combination referred to in this Section 4(b)(i) becomes effective.
(ii) Adjustment for Recapitalizations and Reorganizations. If
at any time or from time to time there shall be a recapitalization of the
Company Common Stock (other than a subdivision or combination provided for in
Section 4(b)(i) above) or a merger, consolidation or reorganization of the
Company, provision shall be made in the transaction so that the Holders will
thereafter be entitled to receive, upon the Exchange, the number of shares of
stock or other securities or property of the Company or otherwise, to which a
holder of that number of shares of Company Common Stock, deliverable upon
exchange of the FX Shares, immediately prior to the transaction, would have been
entitled in connection with the transaction. In any such case, appropriate
adjustment will be made in the application of the provisions of this Section
4(b), with respect to the rights of the Holders after the transaction, to the
end that the provisions of this Section 4(b) (including adjustment of the
Exchange Rate then in effect and the number of shares issuable upon the
Exchange) shall be applicable after that event as nearly equivalent as is
possible, using reasonable efforts.
(c) Notice of Adjustments. In each case of an adjustment or
readjustment of the Exchange Rate or the number of shares of Company Common
Stock or other securities issuable upon the Exchange, if the adjustment or
readjustment results in a change of more than 1% from the previous rate or
number of shares, the Company, or independent public accountants selected by the
Company, shall compute the adjustment or readjustment in accordance with this
Agreement and prepare a certificate showing the adjustment or readjustment, and
the Company will deliver the certificate to each Holder. The certificate will
set forth the adjustment or readjustment, showing in detail the facts upon which
the adjustment or readjustment is based, including a statement of (i) the
capital stock of the Company then outstanding, (ii) the Exchange Rate then in
effect and (ii) the number of shares of Company Common Stock and the type and
amount, if any, of other property which at the time would be received upon
exchange of the FX Shares.
(d) Disputes as to Calculation of Exchange Rate. In the event of a
disagreement between the parties regarding the Exchange Rate. (i) each of the
Member Representative and the Company will retain independent public accountants
to determine the rate, and within 30 days thereafter, will deliver to the other
the written report of its accountants calculating the rate; (ii) if the higher
rate is less than 10% above the lower rate, the average will be the Exchange
Rate; (iii) if the rates exceed this 10% difference, the Member Representative
and the Company will instruct their
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<PAGE> 7
accountants to forthwith select a third reputable accounting firm to determine
the Exchange Rate, and (x) if the third accounting firm's rate is between the
rates of the other accountants. the third accounting firm's rate will be the
Exchange Rate, or (y) if the third accounting firm's rate is outside the range
of the other accountants' rates, the other accountants will continue to select
new third accounting firms, until a third accounting firm so selected provides a
rate which is between the first two rates, and this rate will be the Exchange
Rate. In connection with these valuations, the Company will, on a confidential
basis, deliver or provide access to each accounting firm of all information
reasonably requested by the accounting firm in order to determine the Exchange
Rate. The entire cost of all valuations performed under this Section 4(d) shall
be borne by the Company.
(e) Notice of Events Pertinent to Exchange Rights. If: (i) the
Company shall set a record date for the purpose of entitling the holders of
Company Common Stock to receive a dividend in Company Common Stock, or any other
distribution of property or securities of the Company; or (ii) the Company shall
set a record date for the purpose of entitling the holders of Company Common
Stock, as a class, to subscribe for or purchase any shares of any class or
securities convertible into or exchangeable for shares of any class, or any
option, right or warrant. to subscribe for any of the foregoing; or (iii) there
is a merger or consolidation of the Company with or into another corporation or
corporations; or (iv) there is a reorganization of the Company (including any
exchange reorganization or sale-of-assets reorganization) or a recapitalization
or reclassification of the capital stock of the Company; or (v) there is a
voluntary or involuntary dissolution, liquidation, or winding up of the Company;
then, and in any such case, the Company will cause to be mailed to the Holders,
at least 30 days prior to the date specified below, a notice stating the date
(x) that has been set as the record date for the purpose of a dividend,
distribution, or rights subscription as described in clauses (i) and (ii) of
this subsection 4(e), or (y) on which the merger or consolidation,
reorganization, liquidation, dissolution or winding up described in clauses
(iii) through (v) of this subsection 4(e) is to take place.
5. Closing of Exchange. The closing of the Exchange will take place at the
time and place as the Member Representative and the Company shall mutually agree
upon; provided, that the date of closing will be within 10 days following the
effective date of the Exchange as determined pursuant to Section 2 of this
Agreement. At the closing, each of the Holders will deliver to the Company
documents of transfer in form and substance reasonably acceptable to the Company
and its counsel, necessary to vest in the Company good and marketable title to
the FX Shares so exchanged by the Holder, free and clear of any and all liens
and rights of third parties, other than those imposed under or pursuant to this
Agreement, the Contribution Agreement, against delivery by the Company to the
Holders of certificates representing the Exchange Shares in the names and
denominations specified by the Holders prior to the closing.
6. Preemptive Rights.
(a) Grant of Rights. Until a Qualified Public Offering, and except
as provided in this Section 6, the Holders shall have the right to purchase,
during the period or periods, at the prices and on the other terms and
conditions fixed by the Board of Directors of the Company, any shares of Company
Common Stock. and any options or warrants or other instruments or securities
exchangeable for or convertible into shares of Company Common Stock or
evidencing any right to
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<PAGE> 8
subscribe for, purchase or otherwise acquire shares of Company Common Stock.
which may be issued from time to time by the Company.
(b) Pro-Rata Purchase. Each of the Holders shall have the right to
purchase his or its pro rata portion of the securities subject to this Section
6. After giving notice of any proposed issuance of securities subject to this
Section 6 and affording each Holder the opportunity to purchase his or its pro
rata share of the securities during a period of not less than 15 days after the
date notice is first given to the Holder, the Company may thereafter sell any of
the pro rata share of the securities that are not purchased by the Holders
without further offering them to the Holders. Failure by a Holder to purchase
his or its pro rata share of securities by exercise of a preemptive right on one
occasion shall not constitute a waiver of such right with respect to future
offerings by the Company.
(c) Limitations on Preemptive Rights. Notwithstanding the foregoing,
the Company may issue shares of Company Common Stock, or any options or warrants
or other instruments or securities exchangeable for or convertible into shares
of Company Common Stock or evidencing any right to subscribe for, purchase or
otherwise acquire shares of Company Common Stock, without first offering the
same to the Holders in the following circumstances: (i) in exchange for capital
stock of the Company; (ii) to fulfill or comply with any obligation of the
Company to issue shares of Company Common Stock pursuant to any present or
future stock option plan, stock purchase, bonus, savings investment, or other
stock incentive programs for the benefit of the directors, officers, employees
of or consultants to the Company; provided, that the maximum number of shares
that may be issued pursuant to any of the foregoing in any five year period does
not exceed 15% of the total shares of Company Common Stock outstanding
immediately following the closing of the Contribution Agreement (subject to
adjustment to prevent dilution); and provided, further, that the per share
exercise or purchase price under any of the foregoing was determined by the
Company's Board of Directors to be at least 85% of the fair market value of a
share of Company Common Stock at the time of grant of the stock purchase right,
stock option or other stock incentive; (iii) in connection with a Qualified
Public Offering; (iv) in connection with a merger, consolidation or
reorganization of the Company with a Person or Persons who are not Affiliates of
the Company; (v) in connection with any acquisition of the assets of or an
equity interest in any business entity which is, or is owned by, a Person not an
Affiliate of the Company, the Investors or the Existing Stockholder; or (vi) in
connection with any other transaction approved in writing by the Member
Representative.
7. Put Option.
(a) Option. If a Qualified Public Offering has not occurred prior to
the fifth anniversary of the date of this Agreement (the "Option Trigger Date"),
the Member Representative shall have the right and option (the "Put Option") at
any time following the Exchange, to require the Company to purchase for the "Put
Option Price" (as defined below) up to an aggregate number of Exchange Shares
owned by the Holders (the shares subject to the Put Option are referred to in
this Agreement as the "Option Shares") equal to (i) $900,000 divided by (ii) the
per share value (the "Per Share Value") determined pursuant to Section 7(c)
below, by delivering written notice of election to exercise the Put Option to
the Company. The effective date of the Put Option shall be the date the exercise
notice is given by the Member Representative to the Company. The portion of
the Option
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<PAGE> 9
Shares to be purchased from each Holder shall be based on the relative
percentages of Exchange Shares then held by all of the Holders on the effective
date of the Put Option.
(b) Put Option Price. The "Put Option Price" for the Option Shares
shall mean an amount equal to the sum of (i) $900,000 plus (ii) an additional
amount necessary for the Holders to realize, on an after-tax (state and Federal)
basis (calculated at the then-highest marginal tax rates, but assuming a Federal
deduction for state taxes paid), and including any and all taxes (at the same
marginal rates) payable on the additional amounts paid pursuant to this
subsection (ii), an amount equal to the after-tax amount (similarly calculated)
which the Holders would have realized had the payment of the $900,000 amount
been treated, for all tax purposes, as a long-term (and if there is then more
than one long-term rate, the rate applicable to assets held for at least seven
years at the time of sale) capital gain.
(c) Per Share Value.
(i) Calculation of Per Share Value. The Per Share Value for
purposes of calculating the number of Option Shares under the Put Option shall
be an amount equal to the "Fair Market Value" (as defined below) of the Company
on the effective date of the Put Option, divided by the number of shares of
Company Common Stock issued and outstanding on the effective date of the Put
Option (and if there is more than one class of common stock of the Company then
outstanding, the denominator shall be adjusted to include on an equitable basis
all then outstanding shares of all classes of common stock). For purposes of
Section 7(b), "Fair Market Value" means the value determined on the basis of the
businesses, properties, historical financial performance and financial
condition, projections and prospects for the further growth of the Company,
including its Subsidiaries and other consolidated or owned operations,
considered as a single entity. The parties will use reasonable efforts to reach
agreement on the Fair Market Value. In the event of a disagreement between the
parties regarding the Fair Market Value, (i) each of the Member Representative
and the Company will retain a reputable investment bank to determine the value,
and within 30 days thereafter, will deliver to the other the written report of
its investment bank as to the value; (ii) if the higher valuation is less than
10% above the lower valuation, the average will be the Fair Market Value; (iii)
if the valuations exceed this 10% difference, the Member Representative and the
Company will instruct their investment banks to forthwith select a third
reputable investment bank, and (x) if the third investment bank's valuation is
between the valuations of the other banks, the third investment bank's valuation
will be the Fair Market Value, or (y) if the third investment bank's valuation
is outside the range of the other banks, the average of the two investment
banks' valuations that are closest together will be the Fair Market Value unless
the middle valuation is equally different from the high and low valuations, in
which case the middle valuation will be the Fair Market Value. In connection
with these valuations, the Company will, on a confidential basis, deliver or
provide access to each investment bank of all information reasonably requested
by the investment bank in order to determine the Fair Market Value. The entire
cost of all appraisals performed under this Section 7(c)(i) shall be borne by
the Company.
(ii) Payment of Put Option Price. The Put Option Price for the
Option Shares under the Put Option shall be paid, at the election of the Member
Representative, by either (x) bank cashiers' checks in immediately available
funds payable to the order of the selling holders, or (y) wire transfer of
immediately available funds to an account or accounts designated by the
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<PAGE> 10
Member Representative. Notwithstanding the foregoing, if the funds of the
Company legally available to be paid for redemption of the Option Shares under
applicable corporate law are insufficient to redeem all of the Option Shares,
those funds which are legally available will be used to redeem the maximum
possible number of Option Shares ratably among the Holders based upon the number
of Option Shares held by each Holder, and the remaining Option Shares will be
redeemed from the Holders by payment of a secured promissory note to each Holder
with a principal amount equal to the balance of the purchase price for the
Holder's Option Shares (each a "Note" and collectively, the "Notes"). Each Note
(a) will bear interest at an annual rate equal to the lesser of (x) the highest
interest rate permissible by law and (y) the rate announced from time to time by
Bank America NT&SA as its reference rate plus 2%, adjusting quarterly, (b) shall
provide for interest only to be payable quarterly and principal to be payable as
provided below, (c) shall be secured by the number of Option Shares paid for
using the Note, and (d) shall have a term of 2 years.
On the last day of each calendar quarter following the closing
of the purchase and sale of the Option Shares (each, a "Payment Date"), the
Company will determine the cash amount legally available to the Company on the
Payment Date that may be used to redeem shares of the Company's capital stock,
and the Company will apply that amount toward repayment of the Notes, which
payment will be applied ratably among the Holders based upon the number of
Option Shares underlying the Notes held by the Holders on the Payment Date.
(d) Put Option Closing. The closing of the purchase and sale of the
Option Shares pursuant to this Section 7 will take place at the time and place
as the Member Representative and the Company shall mutually agree upon;
provided, that the date of closing will be within 30 days following the date of
final determination of the Fair Market Value. At the closing, each of the
Holders of the Option Shares will deliver to the Company documents of transfer
in form and substance reasonably acceptable to the Company and its counsel,
necessary to vest in the Company good and marketable title to the Option Shares
so sold by the Holder, free and clear of any and all liens and rights of third
parties, other than those imposed under or pursuant to this Agreement, the
Contribution Agreement or any other agreement delivered in connection with this
Agreement or the Contribution Agreement, against delivery by the Company to the
Holders of the Option Shares of the Put Option Price for the Option Shares,
payable in the manner set forth in Section 7(c)(ii) above.
(e) Right of Set Off. In addition to, and without limiting any other
rights the Company may have under that certain Non-Recourse Secured Promissory
Note, dated as of the date of this Agreement, in the principal amount of up to
$600,000 delivered by Burns to the Company (the "Promissory Note"), Burns hereby
grants to the Company a right to set off and apply any payments of the Put
Option Price required to be made by the Company to Burns under this Section 7
against any amounts due (and not paid when due) by Burns to the Company under
the Promissory Note, without presentment, demand, protest or other notice of any
kind, all of which Burns hereby expressly waives.
8. FX Stock. Until the Exchange, other than (i) as contemplated by this
Agreement or the Contribution Agreement, or (ii) as consented to in writing by
the Member Representative, the Company will not, and the Existing Stockholder
will not permit or cause the Company to. (x) sell, transfer or otherwise dispose
of any shares of capital stock of FX owned by the Company on the date of this
Agreement, or cause or permit FX to issue, sell or otherwise dispose of, or
purchase, redeem
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or otherwise acquire any shares of capital stock of FX, or (y) grant, or cause
or permit FX to grant, any right (or the preemptive right) or any option to
subscribe for or purchase, or enter into, or cause or permit FX to enter into,
any agreement for the issuance (contingent or otherwise) of, or create, or cause
or permit FX to create, any call, commitment, stock appreciation right, claim or
other right of any character relating to, any shares of capital stock of FX.
9. Hold-Back Agreement
(a) By Burns. Except as otherwise provided in Section 9(c) below,
and in addition to all other obligations of Burns regarding the transfer of
shares of Company Common Stock, Burns agrees that, without the prior written
consent of the Existing Stockholder, he will not, during the period commencing
on the date of this Agreement and ending on the fifth anniversary of the date of
this Agreement, transfer (i) any of a number of Exchange Shares equal to 30% of
the Exchange Shares received by Burns at the closing of the Exchange, (ii) any
securities issued by the Company with respect to those Exchange Shares by way of
dividend or stock split or similar transaction, and (iii) any securities issued
by the Company or a successor to the Company with respect to those Exchange
Shares in connection with any recapitalization, merger, consolidation or other
reorganization.
(b) By the Existing Stockholder. Except as otherwise provided in
Section 9(c) below, and in addition to all other obligations of the Existing
Stockholder regarding the transfer of shares of Company Common Stock, the
Existing Stockholder agrees that, without the prior written consent of Burns, he
will not, during the period commencing on the date of this Agreement and ending
on the fifth anniversary of the date of this Agreement, transfer (i) any of
866,250 shares of Company Common Stock, (ii) any securities issued by the
Company with respect to those shares of Company Common Stock by way of dividend
or stock split or similar transaction, and (iii) any securities issued by the
Company or a successor to the Company with respect to those shares of Company
Common Stock in connection with any recapitalization, merger, consolidation or
other reorganization.
(c) Transfers to Family Members or Trusts. Nothing in Sections 9(a)
and (b) shall require Burns or the Existing Stockholder to obtain the other's
consent to a transfer of all or a portion of his respective shares of Company
Common Stock subject to the restrictions on transfer set forth in Section 9(a)
or Section 9(b), by death or inter vivos, (i) to any of his Family Members, or
(ii) to any trust established solely for his benefit or for the benefit of one
or more of his Family Members, or to any legal entity in which he or any of
these Persons are the sole beneficial owners. Any shares transferred to the
executor of an estate, in the case of death, to any Family Member, or to any
trust or other legal entity described above in subsection (ii) of this Section
9(c), shall be subject to the provisions of this Section 9. No transfer of
shares may be made to any of the foregoing Persons pursuant to this Section 9(c)
unless and until the Person delivers to Burns or the Existing Stockholder, as
the case may be, a signed counterpart of this Agreement or a written
acknowledgment that the shares to be received in the proposed transfer are
subject to Section 9 of this Agreement and that the Person and his successors in
interest are bound by this Section 9 and agree to comply with its terms. Any
attempted transfer of shares under this Section 9(c) to any of the foregoing
Persons other than in accordance with this Section 9(c) shall be null and void
and the Company will refuse to recognize the transfer and not reflect in its
records any change in record
11
<PAGE> 12
ownership of shares pursuant to the transfer, and the Company will refuse to
treat as owner of the shares or to accord the right to vote as the owner or to
pay dividends to any transferee to whom the shares shall have been transferred.
10. Miscellaneous
(a) Notices. All notices, demands or other communications hereunder
shall be in writing and shall be deemed to have been duly given if delivered in
person, or by United States mail, certified or registered, return receipt
requested or otherwise actually delivered:
(i) if to any of the Investors or Holders or to the Existing
Stockholder, at the address set forth for each of these Persons on the
Company's books; and
(ii) if to the Company, at the address of the Company as set forth
in the Contribution Agreement, marked for attention as therein indicated;
or such other address as may have been furnished by such Person in writing to
the other parties. Any such notice, demand or other communication shall be
deemed to have been given on the date actually delivered or as of the date
mailed, as the case may be.
(b) Severability and Governing Law. Should any Section or any part
of a Section within this Agreement be rendered void, invalid or unenforceable by
any court of law for any reason, the invalidity or unenforceability shall not
void or render invalid or unenforceable any other Section or part of a Section
in this Agreement. This Agreement shall be governed and construed in accordance
with the laws of the State of California applicable to contracts made and to be
performed entirely within the State of California, without regard to principles
of conflicts of law.
(c) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
(d) No Adverse Construction. The rule that a contract is to be
construed against the party drafting the contract is hereby waived, and shall
have no applicability in construing this Agreement or the terms of this
Agreement.
(e) Captions and Section Headings. Section titles or captions
contained in this Agreement are inserted as a matter of convenience and for
reference purposes only, and in no way define, limit, extend or describe the
scope of this Agreement or the intent of any provision hereof
(f) Amendments and Waivers. This Agreement may be amended, modified,
superseded, canceled, renewed or extended, and the terms and conditions hereof
may be waived, only by a written instrument signed by all the parties to this
Agreement or, in the case of a waiver, by the party or parties, as the case may
be, waiving compliance. No delay on the part of any party in exercising any
right power or privilege under this Agreement shall operate as a waiver thereof,
nor shall any waiver on the part of any party of any right, power or privilege
under this Agreement, nor any single or partial exercise of any right, power or
privilege under this Agreement, preclude any
12
<PAGE> 13
other or further exercise thereof or the exercise of any other right, power or
privilege under this Agreement.
(g) Costs and Attorneys' Fees. In the event that any action, suit or
other proceeding is instituted concerning or arising out of this Agreement, the
prevailing party shall be entitled to recover all of the prevailing party's
costs and reasonable attorneys' fees incurred in each and every such action,
suit, or other proceedings, including any and all appeals or petitions
therefrom.
(h) Successors and Assigns. Except as otherwise provided in this
Agreement, all rights, covenants and agreements of the parties contained in this
Agreement shall be binding upon and inure to the benefit of their respective
successors and permitted assigns.
(i) Specific Performance. The parties hereto agree that the
securities of FX and the Company cannot be purchased or sold in the open market
and that, for these reasons, among others, the parties will be irreparably
damaged in the event that this Agreement is not specifically enforceable.
Accordingly, in the event of any controversy concerning the securities which are
the subject of this Agreement, or any right or obligation to with respect to
such securities, such right or obligation shall be enforceable in a court of
equity by specific performance. The rights granted in this Section 8(i) shall be
cumulative and not exclusive, and shall be in addition to any and all other
rights which the parties to this Agreement may have under this Agreement, at law
or in equity.
(j) Entire Agreement. This Agreement, the Contribution Agreement,
and the other agreements delivered in connection with this Agreement and the
Contribution Agreement, collectively contain the entire understanding of the
parties, and there are no further or other agreements or understandings, written
or oral, in effect between the parties relating to the subject matter of this
Agreement unless expressly referred to in this Agreement.
(k) Agreement to Perform Required Acts. Each party to this Agreement
agrees to perform any further acts and to execute and deliver any further
documents that may be reasonably necessary to carry out the provisions of this
Agreement, that may be required to secure performance of any party's duties
under this Agreement or that may be required to assure the legal and binding
effect of the provisions of this Agreement.
13
<PAGE> 14
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement as of the date first above written.
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By: /s/ Ramendra P. Singh
-------------------------------------
Dr. Ramendra P. Singh
Its: President
/s/ R. P. Singh
----------------------------------------
Dr. Ramendra P. Singh
INVESTORS:
----------------------------------------
Michael Burns
----------------------------------------
William Dallas
----------------------------------------
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By:________________________________
Its:_______________________________
14
<PAGE> 15
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement as of the date first above written.
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By:
-------------------------------------
Dr. Ramendra P. Singh
Its: President
----------------------------------------
Dr. Ramendra P. Singh
INVESTORS:
/s/ Michael Burns
----------------------------------------
Michael Burns
----------------------------------------
William Dallas
----------------------------------------
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By:________________________________
Its:_______________________________
14
<PAGE> 16
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement as of the date first above written.
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By:
-------------------------------------
Dr. Ramendra P. Singh
Its: President
----------------------------------------
Dr. Ramendra P. Singh
INVESTORS:
----------------------------------------
Michael Burns
/s/ William Dallas
----------------------------------------
William Dallas
----------------------------------------
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By:________________________________
Its:_______________________________
14
<PAGE> 17
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement as of the date first above written.
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By:
-------------------------------------
Dr. Ramendra P. Singh
Its: President
----------------------------------------
Dr. Ramendra P. Singh
INVESTORS:
----------------------------------------
Michael Burns
----------------------------------------
William Dallas
/s/ Jon Feltheimer
----------------------------------------
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By:________________________________
Its:_______________________________
14
<PAGE> 18
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement as of the date first above written.
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By:
-------------------------------------
Dr. Ramendra P. Singh
Its: President
----------------------------------------
Dr. Ramendra P. Singh
INVESTORS:
----------------------------------------
Michael Burns
----------------------------------------
William Dallas
----------------------------------------
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By: /s/
--------------------------------
Its:_______________________________
14
<PAGE> 1
Exhibit 10.16
EXECUTION COPY
================================================================================
CONTRIBUTION AND EXCHANGE AGREEMENT
Dated as of August 12, 1999
By and Among
DYNACS ENGINEERING COMPANY, INC.
("DYNACS"),
CERULEAN FXS, INC.
("FX")
CERULEAN COLORIZATION, L.L.C.
("CERULEAN"),
And
MICHAEL BURNS
WILLIAM DALLAS
JON FELTHEIMER
OFFENSE GROUP ASSOCIATES, LP
("MEMBERS")
================================================================================
<PAGE> 2
TABLE OF CONTENTS
ARTICLE 1 CONTRIBUTION AND EXCHANGE ........................................2
1.1 Contribution of Membership Interests .............................2
1.2 Contribution of Digital Shares ...................................2
1.3 Delivery of FX Common Stock to the Members .......................2
1.4 Delivery of FX Common Stock to Dynacs ............................2
ARTICLE 2 CLOSING; MEMBER REPRESENTATIVE ...................................2
2.1 Closing ..........................................................2
2.2 Member Representative ............................................3
ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF THE MEMBERS ....................4
3.1 Title to the Membership Interests ................................4
3.2 Authority; Binding Obligation ....................................4
3.3 No Conflicts .....................................................4
3.4 Purchase for Investment ..........................................5
3.5 Accredited Investor ..............................................5
ARTICLE 4 REPRESENTATIONS AND WARRANTIES
OF CERULEAN AND BURNS ............................................5
4.1 Due Formation ....................................................5
4.2 Authority; Binding Obligation ....................................5
4.3 Qualification ....................................................6
4.4 No Conflicts .....................................................6
4.5 Membership Interests .............................................6
4.6 Charter Documents and Corporate Records ..........................7
4.7 Financial Statements .............................................7
4.8 No Material Adverse Change .......................................7
4.9 Compliance with Laws .............................................7
4.10 Permits ..........................................................8
4.11 Orders and Actions ...............................................8
4.12 Cerulean Material Contracts ......................................8
4.13 Real Property ....................................................8
4.14 Environmental Compliance Matters .................................9
4.15 Receivables ......................................................9
4.16 Accounts Payable ................................................10
4.17 Tangible Property ...............................................10
4.18 Intangible Property .............................................10
4.19 Title to Assets and Properties ..................................10
4.20 Liabilities .....................................................10
4.21 Employee Benefits ...............................................11
4.22 Employee Relations ..............................................11
4.23 Insurance .......................................................12
i
<PAGE> 3
4.24 Operations of Cerulean ..........................................12
4.25 No Brokers ......................................................12
4.25 Tax Matters .....................................................12
4.26 Year 2000 Reprogramming .........................................13
4.27 Full Disclosure .................................................13
ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF DYNACS ........................13
5.1 Title to the Digital Shares .....................................13
5.2 Purchase for Investment .........................................14
5.3 Accredited Investor .............................................14
5.4 Due Incorporation ...............................................14
5.5 Authority; Binding Obligation ...................................14
5.6 Qualification ...................................................14
5.7 No Conflicts ....................................................14
5.8 Capital Stock of Dynacs .........................................15
5.9 Capital Stock of FX .............................................16
5.10 Charter Documents and Corporate Records .........................16
5.11 Financial Statements ............................................17
5.12 No Material Adverse Change ......................................17
5.13 Compliance with Laws ............................................17
5.14 Permits .........................................................18
5.15 Orders and Actions ..............................................18
5.16 Dynacs Material Contracts .......................................18
5.17 Real Property ...................................................19
5.18 Environmental Compliance Matters ................................20
5.19 Receivables .....................................................20
5.20 Tangible Property ...............................................20
5.21 Intangible Property .............................................20
5.22 Title to Assets and Properties ..................................21
5.23 Liabilities .....................................................21
5.24 Employee Benefits ...............................................21
5.25 Employee Relations ..............................................22
5.26 Insurance .......................................................22
5.27 Operations of Dynacs ............................................22
5.28 Subsidiaries and Affiliates .....................................23
5.29 No Brokers ......................................................23
5.30 Tax Matters .....................................................23
5.31 Year 2000 Reprogramming .........................................23
5.32 Full Disclosure .................................................24
ARTICLE 6 COVENANTS AND AGREEMENTS ........................................24
6.1 Affirmative Covenants of Dynacs .................................24
6.2 Negative Covenants of Dynacs ....................................26
6.3 Affirmative Covenants of Cerulean ...............................26
6.4 Salaries of Cerulean ............................................26
6.5 Resignation of Burns as Manager .................................26
ii
<PAGE> 4
6.6 Shareholders Agreement ..........................................27
6.7 Registration Agreement ..........................................27
6.8 Exchange Agreement ..............................................27
6.9 Loan to Burns ...................................................27
6.10 First Refusal Agreement .........................................27
6.11 Further Assurances ..............................................27
ARTICLE 7 CONDITIONS PRECEDENT TO THE OBLIGATIONS
OF FX AND DYNACS TO CLOSE .......................................28
7.1 Representations, Warranties and Covenants True ..................28
7.2 Approvals and Consents ..........................................28
7.3 Shareholders Agreement ..........................................28
7.4 Registration Agreement ..........................................28
7.5 Exchange Agreement ..............................................28
7.6 Promissory Note and Security Agreement ..........................28
7.7 First Refusal Agreement .........................................28
7.8 Resignation of Burns as Manager .................................28
7.9 Delivery of the Membership Interests ............................28
7.10 Delivery of the FX Common Stock .................................29
7.11 Articles of Incorporation of Dynacs .............................29
7.12 Opinion of Counsel to Cerulean ..................................29
7.13 Accounts Payable ................................................29
ARTICLE 8 CONDITIONS PRECEDENT TO THE OBLIGATIONS
OF CERULEAN AND THE MEMBERS TO CLOSE ............................29
8.1 Representations, Warranties and Covenants True ..................29
8.2 Approvals and Consents ..........................................29
8.3 Shareholders Agreement ..........................................29
8.4 Registration Agreement ..........................................30
8.5 Exchange Agreement ..............................................30
8.6 Loan to Burns ...................................................30
8.7 First Refusal Agreement .........................................30
8.8 Delivery of FX Common Stock .....................................30
8.9 Delivery of Digital Shares ......................................30
8.10 Articles of Incorporation of Dynacs .............................30
8.11 Opinion of Counsel to Dynacs and FX .............................30
ARTICLE 9 SURVIVAL OF REPRESENTATIONS AND WARRANTIES; .....................30
INDEMNIFICATION .................................................30
9.1 Survival of Representations and Warranties ......................30
9.2 Indemnification .................................................30
ARTICLE 10 MISCELLANEOUS ...................................................33
10.1 Certain Definitions .............................................33
10.2 Business Day ....................................................38
10.3 Notices .........................................................38
iii
<PAGE> 5
10.4 Entire Agreement ................................................39
10.5 Waivers and Amendments; Remedies ................................39
10.6 Governing Law ...................................................40
10.7 Binding Effect; No Assignment ...................................40
10.8 Variations in Pronouns ..........................................40
10.9 Counterparts ....................................................40
10.10 Exhibits and Schedules ..........................................40
10.11 Headings ........................................................40
10.12 Severability ....................................................40
10.13 Costs and Attorneys' Fees .......................................41
10.14 No Adverse Construction .........................................41
INDEX OF APPENDICES
Exhibits:
Exhibit A -- Members and Membership Interests; FX Shares
Exhibit B -- Form of Shareholders Agreement
Exhibit C -- Form of Registration Rights Agreement
Exhibit D -- Form of Exchange Agreement
Exhibit E -- Form of First Refusal Agreement
Exhibit F -- Form of Promissory Note
Exhibit G -- Form of Security Agreement
Exhibit H -- Form of Amended and Restated Articles of
Incorporation of Dynacs
Exhibit I -- Form of Opinion of Counsel to Cerulean
Exhibit J -- Form of Opinion of Counsel to Dynacs
Schedules:
Schedule I -- Member Disclosure Schedule
iv
<PAGE> 6
CONTRIBUTION AND EXCHANGE AGREEMENT
THIS CONTRIBUTION AND EXCHANGE AGREEMENT (this "Agreement"), is made
and entered into as of August 12, 1999, by and among DYNACS ENGINEERING COMPANY,
INC., a Florida corporation ("Dynacs"), CERULEAN FXS, INC., a Florida
corporation ("FX"), CERULEAN COLORIZATION, L.L.C., a Delaware limited liability
company ("Cerulean"), MICHAEL BURNS ("Burns") and the other members of Cerulean
whose names appear on Exhibit A to this Agreement (the members of Cerulean,
including Burns, are collectively referred to in this Agreement as the "Members"
and each as a "Member"). Certain capitalized terms used in this Agreement are
defined in Section 10.1.
RECITALS
A. The Members are the record and beneficial owners of the
Membership Interests of Cerulean represented by the respective Percentage
Interests set forth opposite their names on Exhibit A, constituting 100% of the
Membership Interests of Cerulean.
B. Dynacs is the record and beneficial owner of 500 shares (the
"Digital Shares") of common stock, no par value (the "Digital Common Stock"), of
Dynacs Digital Services, Inc., a Delaware corporation ("Digital"), constituting
100% of the outstanding capital stock of Digital.
C. FX was formed for the purpose of effecting a combination of the
businesses of Cerulean and Digital which, for federal income tax purposes, is
intended to meet the requirements of Section 351 of the Code.
E. To effect the combination, the Members desire to contribute their
Membership Interests to FX in exchange for an aggregate of 20,000 shares of the
common stock, par value $0.01 per share, of FX (the "FX Common Stock"), and
Dynacs desires to contribute the Digital Shares to FX in exchange for an
aggregate of 80,000 shares of FX Common Stock.
F. In order to induce the Members and Cerulean to execute and
deliver this Agreement and consummate the Contemplated Transactions, at the
Closing (i) the Members, Dynacs and the capital stockholders of Dynacs are
entering into a Shareholders Agreement in form and substance identical to
Exhibit B attached to this Agreement (the "Shareholders Agreement"), relating to
and providing for, among other things, the ownership of the capital stock of
Dynacs, (ii) the Members and Dynacs are entering into a Registration Rights
Agreement in form and substance identical to Exhibit C attached to this
Agreement (the "Registration Agreement"), (iii) the Members and Dynacs are
entering into an Exchange Agreement inform and substance identical to Exhibit D
attached to this Agreement (the "Exchange Agreement"), relating to and providing
for, among other things, the right of the Members to exchange their shares of FX
Common Stock for shares of common stock, par value $.001 per share, of Dynacs
(the "Dynacs Common Stock"), and (iv) Burns and Dynacs are entering into a Right
of First Refusal Agreement in form and substance identical to Exhibit E attached
to this Agreement (the "First Refusal Agreement"), providing Burns with a right
of first refusal to acquire certain assets of Cerulean.
<PAGE> 7
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements contained in this Agreement, on the terms and subject
to the conditions set forth in this Agreement, the parties to this Agreement
agree as follows:
ARTICLE 1
CONTRIBUTION AND EXCHANGE
1.1 Contribution of Membership Interests. At the Closing, each
Member, severally and not jointly, agrees to contribute, assign, transfer and
deliver to FX all of the Member's Membership Interests, and all right, title and
interest of the Member in and to the Member's Membership Interests and Cerulean,
and FX agrees to acquire the Membership Interests from each Member in exchange
for an aggregate of 20,000 shares of FX Common Stock to be issued as provided in
Section 1.3 below. At the Closing, each Member shall deliver to FX an assignment
transferring the Member's respective Membership Interests to FX, in form
reasonably satisfactory to FX.
1.2 Contribution of Digital Shares. At the Closing, Dynacs agrees to
contribute, assign, transfer and deliver to FX all of the Digital Shares, and
all right, title and interest of Dynacs in and to the Digital Shares, and FX
agrees to acquire the Digital Shares from Dynacs in exchange for 80,000 shares
of FX Common Stock to be issued as provided in Section 1.4 below. At the
Closing, Dynacs shall deliver the stock certificate(s) representing the Digital
Shares to FX, duly endorsed in blank or accompanied by stock powers duly
executed in blank, in proper form for transfer.
1.3 Delivery of FX Common Stock to the Members. At the Closing, FX
shall issue and deliver to each Member stock certificate(s) representing the
number of validly issued, fully paid and nonassessable shares of FX Common Stock
set forth opposite the Member's name on Exhibit A.
1.4 Delivery of FX Common Stock to Dynacs. At the Closing, FX shall
issue and deliver to Dynacs stock certificate(s) representing 80,000 validly
issued, fully paid and nonassessable shares of FX Common Stock.
ARTICLE 2
CLOSING; MEMBER REPRESENTATIVE
2.1 Closing. The closing of the transactions contemplated by Article
1 and the consummation of the other Contemplated Transactions (the "Closing")
shall take place at the offices of Dynacs Engineering Company, Inc., 35111 U.S.
Highway 19 North, Suite 300, Palm Harbor, Florida 34684, at 10:00 a.m., local
time, on Friday, August 13, 1999, or such other time or date as
2
<PAGE> 8
the parties may agree to in writing, following the satisfaction or waiver (by
the party entitled to waive the same) of all conditions to the consummation of
the Contemplated Transactions. The time and date upon which the Closing occurs
is referred to in this Agreement as the "Closing Date".
2.2 Member Representative
(a) The Member Representative (as defined below) is hereby
appointed by and constitutes the authorized agent and attorney-in-fact of each
of the Members, for and on behalf of the Members, to take any actions and make
and deliver any certificate, notice, consent, instruction or instrument required
or permitted to be taken, made or delivered by the Members under this Agreement
or any other agreement to be delivered pursuant to this Agreement. In connection
with the foregoing, the Member Representative may, at the sole cost and expense
of the Members, hire or retain counsel, accountants and other professional
advisors as determined by the Member Representative to be necessary, advisable
or appropriate in order to carry out its obligations under this Section 2.2 and
or the Charter Documents of Cerulean, and may rely in good faith upon the advice
received from any of the foregoing Persons. A decision, act, consent or
instruction of the Member Representative shall constitute a decision of all of
the Members, and shall be final, binding and conclusive upon each of the
Members, and Dynacs, FX and Cerulean may rely upon any decision, act, consent or
instruction of the Member Representative as being the decision, act, consent or
instruction of each and all of the Members. Notices or communications to or from
the Member Representative with respect to this Agreement shall constitute notice
to or from each of the Members, individually, and all of the Members,
collectively. Dynacs, FX and Cerulean are relieved from any liability to any
Person for any acts done by them in accordance with any decision, act, consent
or instruction of the Member Representative made in accordance with this Section
2.2. Under no circumstances shall the Member Representative have any liability
to the Members for any act or omission to act of the Member Representative while
acting in his capacity as the Member Representative, unless the Member asserting
liability is able to prove that the Member Representative was guilty of willful
misconduct or bad faith. Each Member shall, severally but not jointly and pro
rata based on the percentage of Membership Interests owned by the Member on the
date of this Agreement as set forth on Exhibit A, indemnify, save and hold
harmless the Member Representative from and against any and all Damages incurred
in connection with, arising out of resulting from or incident to any act or
omission to act of the Member Representative while acting in his capacity as the
Member Representative, except to the extent caused by the willful misconduct or
bad faith of the Member Representative.
(b) As used in this Agreement, the "Member Representative"
shall mean Michael Burns, or any Person properly designated in writing delivered
to Dynacs and the Members by Michael Burns, or his successors and assigns, as a
successor Member Representative, but in no event may such successor Member
Representative be an officer, director, shareholder, agent or affiliate of
Dynacs.
3
<PAGE> 9
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE MEMBERS
Except as set forth in Schedule I to this Agreement, which Schedule
shall refer to the relevant Sections of this Agreement (the "Member Disclosure
Schedule"), each Member, severally and not jointly, represents and warrants to
Dynacs and FX solely as to himself or itself as follows:
3.1 Title to the Membership Interests. The Member owns beneficially
and of record, and has good and marketable title to, the Membership Interests
represented by the respective Percentage Interest set forth opposite the
Member's name on Exhibit A, free and clear of any Liens and restrictions other
than restrictions on transfer of the Membership Interests imposed upon a limited
liability company member of Cerulean under the Charter Documents of Cerulean and
restrictions generally imposed by the securities laws of the United States and
of the various states, and, upon delivery of and issuance of FX Common Stock in
exchange for the Membership Interests as provided in this Agreement, FX will
acquire good and marketable title thereto, free and clear of any Liens and
restrictions other than restrictions on transfer of the Membership Interests
imposed upon a limited liability company member of Cerulean under the Charter
Documents of Cerulean and restrictions generally imposed by the securities laws
of the United States and of the various states. The Member has no outstanding
contractual obligations or rights to purchase or otherwise acquire. whether from
Cerulean or otherwise, any shares of capital stock or other ownership interests,
or securities convertible or exchangeable into or exercisable for shares of
capital stock or other ownership interests, of Cerulean.
3.2 Authority: Binding Obligation. The Member has the full legal
capacity and all authority required to execute, deliver and perform his or its
obligations under this Agreement, to sell his or its respective Membership
Interests and to consummate the Contemplated Transactions to which the Member is
a party. This Agreement has been duly and validly executed and delivered by the
Member and constitutes the Member`s legal, valid and binding obligation,
enforceable against the Member in accordance with its terms.
3.3 No Conflicts. The execution, delivery and performance by the
Member of this Agreement and each other agreement to be delivered by the Member
pursuant to this Agreement, the compliance by the Member with the terms and
provisions of this Agreement and each other agreement to be delivered by the
Member pursuant to this Agreement, and the consummation of the Contemplated
Transactions to which the Member is a party, will not (i) require the Member to
obtain any consent, approval or action of, or make any filing with or give any
notice to, any Governmental Body or any Person; (ii) violate, conflict with or
result in the breach of any of the terms of, result in a material modification
or acceleration of the effect of, otherwise cause the termination of or give any
other contracting party the right to terminate or a right of first refusal, or
constitute (or with notice or lapse of time or both, constitute) a default
under, any Contract to which the Member is a party or by or to which the Member
or any of the Member's assets or properties may be bound or subject, or result
in the creation of any Lien upon the assets or properties of the Member pursuant
to the terms of any of these Contracts; or (iii) violate any Law or Order
against, or binding upon, the Member or his or its assets or properties.
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3.4 Purchase for Investment. The Member is acquiring the shares of
FX Common Stock for investment purposes only and not with a view to the sale or
distribution thereof in violation of any applicable federal or state securities
laws; provided that nothing contained in this Section 3.4 shall prevent the
Member from transferring shares of FX Common Stock in compliance with the
provisions of this Agreement, the Exchange Agreement and the Shareholders
Agreement. The Member acknowledges that the shares of FX Common Stock to be
acquired by the Member pursuant to this Agreement are not registered under the
Securities Act of 1933, as amended (the "Securities Act") and cannot be sold or
otherwise disposed of except in compliance with the Securities Act or in
reliance upon an exemption from the Securities Act. The Member acknowledges that
the certificate(s) representing the shares of FX Common Stock shall bear a
legend in substantially the following form:
"THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE
SECURITIES LAWS, HAVE BEEN ACQUIRED FOR INVESTMENT, AND MAY NOT BE SOLD OR
OFFERED FOR SALE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAW OR AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED."
3.5 Accredited Investor. The Member is an "accredited investor" as
that term is defined in Rule 501(a) of the General Rules and Regulations under
the Securities Act.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
OF CERULEAN AND BURNS
Except as set forth in the disclosure letter delivered by the Member
Representative to Dynacs concurrently with the execution and delivery of this
Agreement, which letter shall refer to the relevant Sections of this Agreement
(the "Cerulean Disclosure Letter"), Cerulean and Burns represent and warrant to
Dynacs and FX as follows:
4.1 Due Formation. Cerulean is a limited liability company duly
organized, validly existing and in good standing under the laws of the State of
Delaware and has the power and authority as a limited liability company to own,
lease and operate its properties and to carry on its business as it is now
conducted and has been conducted prior to the date of this Agreement.
4.2 Authority; Binding Obligation. Cerulean has all requisite power
and authority to execute, deliver and perform its obligations under this
Agreement and to consummate the Contemplated Transactions to which it is a
party. This Agreement has been duly executed and delivered by Cerulean and
constitutes, and as of the Closing, each other agreement to be delivered by
Cerulean pursuant to this Agreement will be duly executed and delivered by
Cerulean and will constitute, Cerulean's legal, valid and binding obligations,
enforceable against Cerulean in accordance
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with their respective terms. Cerulean has taken all action necessary to
authorize the execution and deliver of this Agreement and each other agreement
to be delivered by Cerulean pursuant to this Agreement, the performance by
Cerulean of its obligations under this Agreement and under each other agreement
to be delivered by Cerulean pursuant to this Agreement and the consummation of
the Contemplated Transactions to which it may be a party.
4.3 Qualification. Cerulean is duly qualified or otherwise
authorized as a foreign company to transact business and is in good standing in
each jurisdiction in which this qualification or authorization is required by
law and in which the failure so to qualify or be authorized would have a
material adverse effect on the Condition of Cerulean.
4.4 No Conflicts. The execution, delivery and performance by
Cerulean of this Agreement and each other agreement to be delivered by Cerulean
pursuant to this Agreement, the compliance by Cerulean with the terms and
provisions of this Agreement and each other agreement to be delivered by
Cerulean pursuant to this Agreement, and the consummation of the Contemplated
Transactions do not and will not (i) violate any provision of the Charter
Documents of Cerulean as in effect on the date of this Agreement; (ii) require
Cerulean to obtain any consent, approval or action of, or make any filing with
or give any notice to, any Governmental Body or any Person; (iii) violate,
conflict with or result in the breach of any of the terms of, result in a
material modification or acceleration of the effect of otherwise cause the
termination of or give any other contracting party the right to terminate or a
right of first refusal, or constitute (or with notice or lapse of time or both,
constitute) a default under, any Contract to which Cerulean is a party or by or
to which Cerulean or any of its assets or properties may be bound or subject, or
result in the creation of any Lien upon the assets or properties of Cerulean
pursuant to the terms of any these Contracts; (iv) violate any Law or Order
against, or binding upon, Cerulean or upon its respective securities, properties
or business; or (v) violate or result in the revocation or suspension of any
Permit.
4.5 Membership Interests. Exhibit A to this Agreement sets forth a
complete list of all Persons who own any Membership Interests and the respective
Percentage Interests owned by each of these Persons. Except as set forth in the
Cerulean Disclosure Letter, there are no options, warrants, agreements,
convertible securities, exchangeable securities, commitments or other rights
outstanding which afford any Person the right to purchase or otherwise acquire
from Cerulean any Membership Interests or any other equity security of Cerulean
or that give any Person the right to receive any benefits or rights similar to
any rights enjoyed by or accruing to the holders of Membership Interests of
Cerulean. There are no options, warrants, agreements, convertible securities,
exchangeable securities, commitments or other rights outstanding pursuant to
which Cerulean may become obligated to purchase or redeem any Membership
Interests or other securities of Cerulean. There are no outstanding bonds,
debentures, notes or other indebtedness having the right to vote on any matters
on which the Members of Cerulean may vote. The Membership Interests constitute
all of the outstanding equity securities of Cerulean. The Membership Interests
are owned of record and beneficially by, and are represented by the respective
Percentage Interests set forth opposite the names of, the Persons set forth on
Exhibit A to this Agreement. To the knowledge of Cerulean and Burns, the
Membership Interests are owned free and clear of any Liens and restrictions
other than restrictions on transfer of the Membership Interests imposed upon a
limited liability company member of Cerulean under the Charter Documents of
Cerulean, restrictions imposed by this Agreement or any other agreement to be
delivered pursuant to this Agreement and restrictions
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generally imposed by the securities laws of the United States and of the various
states.. The Membership Interests have not been issued in violation of, and the
Membership Interests are not subject to, any purchase option, call, right of
first refusal, preemptive right, subscription or similar right under any
provision of applicable law, the Charter Documents of Cerulean, any Contract to
which Cerulean is a party or by or to which Cerulean or any of its assets or
properties may be bound or subject or otherwise. Other than the Charter
Documents of Cerulean, this Agreement and any other agreement to be delivered
pursuant to this Agreement, the Membership Interests are not subject to any
voting trust agreement or, to the knowledge of Cerulean and Burns, any other
Contract, arrangement, commitment or understanding, including any Contract,
arrangement, commitment or understanding restricting or otherwise relating to
the voting, dividend rights or disposition of the Membership Interests.
4.6 Charter Documents and Corporate Records. Cerulean has previously
delivered to Dynacs true and complete copies of the Charter Documents of
Cerulean, as in effect on the date of this Agreement, including Cerulean's
Certificate of Formation as certified by the Secretary of State of Delaware and
Cerulean's operating agreement. No records of meetings or consents in lieu of
meetings of the Members have been prepared since Cerulean's date of formation.
4.7 Financial Statements The unaudited balance sheet of Cerulean as
at June 24, 1999 and the related statement of income for the period from January
1, 1999 through June 24, 1999 have previously been delivered to Dynacs. (The
unaudited financial statements of Cerulean as at June 24, 1999 and for the
period from January 1, 1999 through June 24, 1999 are sometimes referred to in
this Agreement as the "Cerulean Financials", and the balance sheet as at June
24, 1999 included in the Cerulean Financials is sometimes referred to in this
Agreement as the "Cerulean Balance Sheet".) The Cerulean Financials fairly
present the financial position and results of operations of Cerulean as at June
24, 1999 and for the period from January 1, 1999 through June 24, 1999 subject
to normal year-end adjustments that may be required in the ordinary course of
business.
4.8 No Material Adverse Change. Since December 31, 1998, the
business of Cerulean has been conducted in the ordinary course consistent with
past practice and there has been no material adverse change in the Condition of
Cerulean, and Cerulean does not know of any material adverse change in the
Condition of Cerulean which is threatened, nor has there been any damage;
destruction or loss which could have or has had a material adverse effect on the
Condition of Cerulean, whether or not covered by insurance.
4.9 Compliance with Laws. Except where the failure to be in
compliance would not, individually or in the aggregate, have a material adverse
effect on the Condition of Cerulean, Cerulean and its respective officers,
employees, agents and representatives, are and at all times have been in
compliance in all material respects with all applicable Laws and Orders relating
to Cerulean or the conduct of its business or operations or the use of its
assets or properties, including, without limitation, (i) regulations and
requirements of the Occupational Safety and Health Administration or (ii) any
Safety and Environmental Laws. There are no bases or grounds for any Action with
respect to Cerulean relating to, or arising under, any Law or Order which,
individually or in the aggregate, could have a material adverse effect on the
Condition of Cerulean, and Cerulean has not received and does not know of the
issuance of any written notice of any violation or alleged violation of any Law
or Order by any Governmental Body.
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4.10 Permits. Cerulean has all Permits that are material to the
conduct of Cerulean's business including, without limitation, all Permits
relating to compliance with Safety and Environmental Laws. All of these Permits
and are in full force and effect; no material violations have been recorded or
exist in respect of any of these Permits; and no proceeding is pending or, to
the knowledge of Cerulean and Burns, threatened, to revoke or limit any Permit.
Cerulean has not received any notice from any source to the effect that there is
lacking any material Permit required in connection with the current use or
operation of the assets, properties or business of Cerulean.
4.11 Orders and Actions. There are no outstanding Orders against or
involving Cerulean. There are no Actions (whether or not the defense of the
Action or liabilities in respect of the Action are covered by insurance) pending
or, to the knowledge of Cerulean and Burns, threatened against or involving or
affecting Cerulean or any of its assets or properties which seek to invalidate
the Contemplated Transactions or to recover any Damages or to obtain any other
relief as a result of this Agreement or the Contemplated Transactions, or which,
individually or in the aggregate, could have a material adverse effect upon the
Condition of Cerulean or upon the consummation of the Contemplated Transactions.
To the knowledge of Cerulean and Burns, there is no fact, event or circumstance
that may give rise to any Action described in the immediately preceding
sentence. All notices required to have been given to any insurance company
listed as insuring against any Action have been timely and duly given and no
insurance company has asserted, orally or in writing, that any Action is not
covered by the applicable policy relating to the Action. There are no Actions
pending or, to the knowledge of Cerulean and Burns, threatened that would give
rise to any right of indemnification on the part of any Member or officer of
Cerulean or the heirs, executors or administrators of a Member or officer of
Cerulean against Cerulean or any successor to the business of Cerulean.
4.12 Cerulean Material Contracts. The Cerulean Disclosure Letter
contains a true and complete list of all Cerulean Material Contracts to which
Cerulean is a party or by or to which any of its assets or properties are bound
or subject. Cerulean has delivered or made available to Dynacs true and complete
copies of all of the Cerulean Material Contracts set forth in the Cerulean
Disclosure Letter. All of the Cerulean Material Contracts referred to in the
Cerulean Disclosure Letter are valid and binding upon Cerulean and, to the
knowledge of Cerulean and Burns, on the other parties to the Cerulean Material
Contracts in accordance with their terms. Cerulean is not in default in any
material respect under any of the Cerulean Material Contracts, nor does any
condition exist that with notice or lapse of time or both would constitute a
material default under any Cerulean Material Contract or that would give to any
party to any Cerulean Material Contract any right of termination, first refusal,
cancellation, acceleration or modification of any Cerulean Material Contract. To
the knowledge of Cerulean and Burns, no other party to any Cerulean Material
Contract is in default under any Cerulean Material Contract in any material
respect nor does any condition exist that with notice or lapse of time or both
would constitute a default under any Cerulean Material Contract.
4.13 Real Property. Cerulean does not own any real property.
Cerulean has previously delivered to Dynacs true, correct and complete copies of
all leases, subleases. licenses and other agreements (including all
modifications, amendments and supplements thereto) (collectively, the "Cerulean
Real Property Leases") under which Cerulean uses or occupies or has the right to
use or occupy, now or in the future, any real property (the land, buildings and
other improvements
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covered by the Cerulean Real Property Leases are referred to in this Agreement
as the "Cerulean Leased Real Property"). Each Cerulean Real Property Lease is
valid, binding and in full force and effect and covers the entire estate it
purports to cover, all rent and other sums and charges payable by Cerulean as
tenant under each Cerulean Real Property Lease are current, no notice of default
or termination under any Cerulean Real Property Lease is outstanding, no
termination event or condition or uncured default on the part of Cerulean or, to
the knowledge of Cerulean and the Burns, the landlord, exists under any Cerulean
Real Property Lease, and no event has occurred and no condition exists which,
with the giving of notice or the lapse of time or both, would constitute a
default or termination event or condition under any Cerulean Real Property
Lease. There is no underlying mortgage, deed of trust, lease, grant of term or
other estate in or interest affecting any Cerulean Leased Real Property which
was granted by Cerulean and which is superior to the interest of Cerulean as
tenant under the applicable Cerulean Real Property Lease. Cerulean does not have
any ownership, financial or other interest in the landlord under any Cerulean
Real Property Lease. There are no leases, subleases, licenses or other
agreements granting to any Person other than Cerulean the right to possession,
use, occupancy or enjoyment of any Cerulean Leased Real Property or portion of
any Cerulean Leased Real Property.
4.14 Environmental Compliance Matters. (1) Cerulean has inspected
the Cerulean Leased Real Property and neither Cerulean nor Burns has reason to
believe that there may be Hazardous Substances incorporated in or deposited,
stored or buried at or upon any Cerulean Leased Real Property; (2) to the
knowledge of Cerulean and Burns, no Cerulean Leased Real Property has ever been
used as a waste disposal site or a storage site for petroleum products or
chemicals; (3) to the knowledge of Cerulean and Burns, no existing structures on
any Cerulean Leased Real Property contain asbestos; (4) to the knowledge of
Cerulean and Burns. there are not now any underground storage tanks on any
Cerulean Leased Real Property; (5) Cerulean has not allowed, with the knowledge
or consent of Cerulean, any Person occupying any Cerulean Leased Real Property
to bring Hazardous Substances onto any Cerulean Leased Real Property or to
process or store any Hazardous Substances on any Cerulean Leased Real Property
and, to the knowledge of Cerulean and Burns, no Hazardous Substance has been
released into the environment by Cerulean that may present an imminent and
substantial endangerment to human health; (6) Neither Cerulean nor Burns is
aware of any complaints on file or matters pending in any federal or state
environmental protection offices involving any allegation of Hazardous
Substances on any Cerulean Leased Real Property; and (7) Cerulean has not
received notice from any environmental board, agency or authority requiring the
removal of any Hazardous Substances or other alleged harmful materials or
wastes, or advising of any pending or contemplated search or investigation of
Cerulean Leased Real Property or any portion of the Cerulean Leased Real
Property with respect to the removal of any Hazardous Substances or other
alleged harmful materials or wastes.
4.15 Receivables. All accounts and notes receivable reflected on the
Cerulean Balance Sheet and all accounts and notes receivable arising subsequent
to June 24, 1999 (i) have arisen in the ordinary course of business of Cerulean
and (ii) are subject only to a reserve for bad debts computed in a manner
consistent with past practice and reasonably estimated to reflect the probable
results of collection, have been collected or are collectible in the ordinary
course of business of Cerulean in the aggregate recorded amounts thereof in
accordance with their terms.
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4.16 Accounts Payable. The Cerulean Disclosure Letter sets forth a
true and complete schedule of the accounts payable of Cerulean as of a date
within 5 business days prior to the date of this Agreement, setting forth a
description of the accounts payable including the names of the account creditors
and the balance amount. The accounts payable of Cerulean created after the date
specified in the Cerulean Disclosure Letter have arisen in the ordinary course
of business of Cerulean consistent with past practice.
4.17 Tangible Property. The facilities, machinery, equipment,
furniture, leasehold improvements, fixtures, vehicles, structures, any related
capitalized items and other tangible property material to the business of
Cerulean are in good operating condition and repair, subject to continued repair
and replacement in accordance with past practice, and are suitable for their
intended use.
4.18 Intangible Property. The Cerulean Disclosure Letter sets forth
all patents, trademarks, copyrights, service marks, trade names and franchises,
all applications for any of the foregoing, and all permits, grants and licenses
or other rights running to or from Cerulean relating to any of the foregoing and
any other names used by Cerulean in connection with its business (the "Cerulean
Intangible Property"). Cerulean has the right to use, free and clear of any Lien
or rights of others, all of the Cerulean Intangible Property and all trade
secrets, inventions, know-how, processes, technology, blueprints and designs
utilized in or incident to its business as presently conducted or as being
developed ("Cerulean Trade Secrets"). There is no other Cerulean Intangible
Property which is material to the business of Cerulean as presently conducted or
as being developed. Cerulean does not have notice of any adversely held
invention, trademark, service mark, copyright or trade name of any other Person
or notice of, and there is no present or threatened use or encroachment of, any
claim of any other Person relating to any of the Cerulean Intangible Property or
any Cerulean Trade Secret or confidential information of Cerulean, and neither
Cerulean nor Burns knows of any basis for any of these charges or claims. All of
the Permits, grants and licenses or other rights relating to any of the
foregoing and set forth on the Cerulean Disclosure Letter are valid and binding
upon Cerulean in accordance with their terms. Cerulean is not in default in any
material respect under any of the Cerulean Intangible Property or any Cerulean
Trade Secret, nor does any condition exist that with notice or lapse of time or
both would constitute a material default under any of the Cerulean Intangible
Property or any Cerulean Trade Secret. To the knowledge of Cerulean and Burns,
no other party is in default under any of the Cerulean Intangible Property or
any Cerulean Trade Secret in any material respect nor does any condition exist
that with notice or lapse of time or both would constitute a material default by
any other party under any of the Cerulean Intangible Property or any Cerulean
Trade Secret.
4.19 Title to Assets and Properties. Cerulean has good and
marketable title to, or a valid right to use, all assets and properties used by
it in the conduct of its business, free and clear of any Lien other than Liens
which would not, individually or in the aggregate, have a material adverse
effect on the Condition of Cerulean. No mortgage, trust deed, chattel mortgage,
security agreement, financing statement or other instrument encumbering any of
these assets has been recorded, filed, executed or delivered.
4.20 Liabilities Cerulean does not have any direct or indirect
indebtedness, liability, claim, loss, damage, deficiency, obligation or
responsibility, fixed or unfixed, choate or inchoate, liquidated or
unliquidated, secured or unsecured, accrued, absolute, contingent or otherwise,
direct
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or indirect through any Affiliate, of a kind required by GAAP to be set forth in
financial statements or in the notes to the financial statements
("Liabilities"), that were not fully and adequately reflected or reserved
against on the Cerulean Balance Sheet, except for (i) Contracts entered into in
the ordinary course of business which are not required to be disclosed on the
Cerulean Disclosure Letter (none of which are reflected in the Cerulean
Financials) and (ii) current Liabilities incurred in the ordinary course of
business since June 24, 1999, which are properly reflected on Cerulean's books
and records and which are not inconsistent with the other representations,
warranties and agreements of Cerulean set forth in this Agreement. Neither
Cerulean nor Burns has knowledge of any circumstance, condition, event or
arrangement that may hereafter give rise to any Liabilities of Cerulean except
in the ordinary course of business.
4.21 Employee Benefits. Cerulean has delivered or made available to
Dynacs true and correct copies of all plans and other arrangements involving
direct or indirect compensation or benefits to Members, officers or consultants
or providing employee benefits to employees of Cerulean, including, without
limitation, all "employee benefit plans" as defined in Section 3(3) of ERISA,
and all bonus, stock option, stock purchase, incentive, deferred compensation,
supplemental retirement, severance and other similar fringe or employee benefit
plans, and all employment or executive compensation agreements (collectively,
the "Cerulean Plans"). All Cerulean Plans comply with and are and have been
operated in material compliance with each applicable provision of ERISA, the
Code, other federal statutes, state law (including, without limitation, state
insurance law) and the regulations and rules promulgated pursuant thereto or in
connection therewith, except for any failure to comply which would not have a
material adverse effect on the Condition of Cerulean. No Cerulean Plan is
covered by Title IV of ERISA or Section 412 of the Code. Neither Cerulean nor
any ERISA Affiliate of Cerulean has failed to make any contributions or to pay
any amounts due and owing as required by the terms of any Cerulean Plan, which
failure would have a material adverse effect on the Condition of Cerulean.
Except as required by Section 4980B of the Code, neither Cerulean nor any ERISA
Affiliate of Cerulean has promised any former employee or other individual not
employed by Cerulean or any ERISA Affiliate of Cerulean, medical or other
benefit coverage, and neither Cerulean nor any ERISA Affiliate of Cerulean
maintains or contributes to any plan or arrangement providing medical benefits,
life insurance or other welfare benefits to former employees, their spouses or
dependents or any other individual not employed by Cerulean or any ERISA
Affiliate of Cerulean except to the extent required by applicable law.
4.22 Employee Relations. Since Cerulean's formation, none of
Cerulean's employees are or have been represented by any union or collective
bargaining group or association with respect to their employment with Cerulean
and Cerulean is not, and has not been, engaged in, and has not planned and is
not planning to engage in, any arrangement or agreement with any union or
collective bargaining group or association. There is no organizing activity
involving Cerulean that is pending or threatened by any labor organization or
group of employees. There are no representation proceedings pending or
threatened before the National Labor Relations Board, and no labor organization
or group of employees of Cerulean has made a pending demand for recognition. To
the knowledge of Cerulean and Burns, Cerulean has not engaged since its
formation, and is not engaged, in any unfair labor practice and there are no
pending or, to the knowledge of Cerulean and Burns, threatened, unfair labor
practice charges or any other employee-related charges or complaints against
Cerulean before the National Labor Relations Board or any other Governmental
Body. Cerulean has not at any time since its formation had, nor, to the
knowledge of Cerulean and Burns,
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is there now threatened, a strike, picket, work stoppage, work slowdown or other
labor trouble that had or may have a material adverse effect on the Contemplated
Transactions or the Condition of Cerulean.
4.23 Insurance. Cerulean has delivered or made available to Dynacs a
true and correct list of all policies of insurance, including the types and
coverage amounts of the insurance, owned by Cerulean or in which Cerulean is
named as an insured party or beneficiary, in each case in connection with
Cerulean's business. True and correct copies of all of these policies have been
delivered or made available to Dynacs. All of these policies are in full force
and effect and Cerulean has not received any notice of cancellation of any of
these insurance policies.
4.24 Operations of Cerulean. Since June 24, 1999, Cerulean has
conducted its business in all material respects in the ordinary and usual course
consistent with past practice, and there has not been (a) any event or
occurrence which could result in a material adverse effect on the Condition of
Cerulean, (b) any material change in accounting methods, principles and
practices by Cerulean (except for any changes required by reason of a concurrent
change in GAAP), (c) any damage, destruction or loss, whether covered by
insurance or not, having a material adverse effect on the Condition of Cerulean,
or (d) any entry by Cerulean into any commitment or transaction material to the
business of Cerulean which is not in the ordinary course of business consistent
with past practice.
4.25 No Brokers. Cerulean has not entered into any contract,
arrangement or understanding with any Person or firm which may result in the
obligation of Cerulean; a Member, FX or Dynacs to pay any finder's fee,
brokerage or agent's commissions or other like payments in connection with the
negotiation, execution or performance of this Agreement and Cerulean is not
aware of any claim for any of these payments.
4.26 Tax Matters. Cerulean (i) has prepared and duly and timely
filed all Tax Returns required to be filed (subject to any extensions applicable
to the Tax Return) and all of these Tax Returns accurately reflect the Tax
liability of Cerulean in all material respects for the periods to which they
relate, (ii) has paid all Taxes shown to be due and payable on the Tax Returns
or which have become due and payable pursuant to any assessment, deficiency
notice, 30-day letter, or other notice received by it, and (iii) has properly
accrued all Taxes for the periods subsequent to the periods covered by the Tax
Returns, except for any Taxes which would not have a material adverse effect on
the Condition of Cerulean. Cerulean's Tax Returns have not been examined by any
appropriate taxing authority. Cerulean has not executed or filed with the
Internal Revenue Service ("IRS") or any other taxing authority any agreement now
in effect extending the period for assessment or collection of any income or
other Taxes. Cerulean is not a party to any pending action or proceeding by any
Governmental Body for assessment or collection of Taxes, and to the knowledge of
Cerulean and Burns, no claim for assessment or collection of Taxes has been
asserted against Cerulean. Cerulean has delivered or made available to Dynacs
true and correct copies of all Tax Returns with respect to all of the tax years
filed by Cerulean since formation and all communications relating to these Tax
Returns. All Taxes which Cerulean is required to withhold or collect, including
without limitation, sales and use taxes, have been duly withheld or collected
and, to the extent required; have been paid over to the proper Governmental
Body.
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4.27 Year 2000 Reprogramming. The costs to Cerulean of (i) any
reprogramming required to permit the proper functioning, in and following the
year 2000, of Cerulean's (A) computer systems and (B) equipment containing
embedded microchips (including systems and equipment supplied by others), (ii)
the testing of all such systems and equipment and (iii) the reasonably
foreseeable consequences of year 2000 (including, without limitation,
reprogramming errors and the failure of others' systems or equipment) will not
have a material adverse effect on the Condition of Cerulean. Except for such of
the reprogramming referred to in the preceding sentence as may be necessary, the
computer and management information systems of Cerulean are sufficient to permit
Cerulean to conduct its business substantially as it is conducted on the date
hereof.
4.28 Full Disclosure. All Documents (including the schedules and
exhibits to the Documents) delivered by or on behalf of Cerulean in connection
with this Agreement and the Contemplated Transactions are true, complete and
authentic or are true and complete copies, in all material respects, of
authentic Documents. No representation or warranty of Cerulean contained in this
Agreement, and no Documents furnished by or on behalf of Cerulean to Dynacs
pursuant to this Agreement or in connection with the Contemplated Transactions
contains, when read in conjunction with all other papers, an untrue statement of
a material fact or omitted or omits to state a material fact required to be
stated therein or necessary to make the statements made, in the context in which
made, not materially false or misleading. There is no fact that Cerulean has not
disclosed to Dynacs or its representatives that materially adversely affects, or
will materially adversely affect, the Condition of Cerulean or the consummation
of the Contemplated Transactions.
ARTICLE 5
REPRESENTATIONS AND WARRANTEES OF DYNACS
Except as set forth in the disclosure letter delivered by Dynacs to
Cerulean and the Member Representative concurrently with the execution and
delivery of this Agreement, which letter shall refer to the relevant Sections of
this Agreement (the "Dynacs Disclosure Letter"), Dynacs represents and warrants
to Cerulean and each of the Members as follows:
5.1 Title to the Digital Shares. Dynacs owns beneficially and of
record, and has good and marketable title to, the Digital Shares, free and clear
of any Liens and restrictions other than restrictions generally imposed by the
securities laws of the United States and of the various states, and, upon
delivery of and issuance of FX Common Stock in exchange for the Digital Shares
as provided in this Agreement, FX will acquire good and marketable title
thereto, free and clear of any Liens and restrictions other than restrictions
generally imposed by the securities laws of the United States and of the various
states. The Digital Shares constitute all of the issued and outstanding shares
of capital stock of Digital and Dynacs does not own of record or beneficially
any other shares of capital stock of Digital. Dynacs has no outstanding
contractual obligations or rights to purchase or otherwise acquire, whether from
Digital or otherwise, any shares of capital stock or other ownership interests,
or securities convertible or exchangeable into or exercisable for shares of
capital stock or other ownership interests, of Digital.
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5.2 Purchase for Investment. Dynacs is acquiring the shares of FX
Common Stock for investment purposes only and not with a view to the sale or
distribution thereof in violation of any applicable federal or state securities
laws. Dynacs acknowledges that the shares of FX Common Stock to be acquired by
it pursuant to this Agreement are not registered under the Securities Act and
cannot be sold or otherwise disposed of except in compliance with the Securities
Act or in reliance upon an exemption from the Securities Act. Dynacs
acknowledges that the certificate(s) representing the shares of FX Common Stock
shall bear a legend in substantially the following form:
"THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE
SECURITIES LAWS, HAVE BEEN ACQUIRED FOR INVESTMENT, AND MAY NOT BE SOLD OR
OFFERED FOR SALE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAW OR AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED."
5.3 Accredited Investor. Dynacs is an "accredited investor" as that
term is defined in Rule 501(a) of the General Rules and Regulations under the
Securities Act.
5.4 Due Incorporation. Dynacs, each of its Subsidiaries and FX are
each a corporation duly organized, validly existing and in good standing under
the laws of the state of its incorporation and has the corporate power and
authority to own, lease and operate its properties and to carry on its business
as it is now conducted and has previously been conducted.
5.5 Authority; Binding Obligation. Each of Dynacs and FX has all the
requisite corporate power and authority to execute, deliver and perform its
respective obligations under this Agreement and to consummate the Contemplated
Transactions to which it is a party. This Agreement has been duly executed and
delivered by Dynacs and FX and constitutes, and as of the Closing each other
agreement to be delivered by Dynacs and FX pursuant to this Agreement will be
duly executed and delivered by Dynacs and FX and will constitute, each of
Dynacs' and FX's legal, valid and binding obligations, enforceable against
Dynacs and FX in accordance with their respective terms. Each of Dynacs and FX
has taken all action necessary to authorize the execution and delivery of this
Agreement and each other agreement to be delivered by Dynacs and FX pursuant to
this Agreement, the performance by Dynacs and FX of each of its obligations
under this Agreement and under each other agreement to be delivered by Dynacs
and FX pursuant to this Agreement and the consummation of the Contemplated
Transactions to which Dynacs and FX may be a party.
5.6 Qualification. Dynacs, each of its Subsidiaries and FX are each
duly qualified or otherwise authorized as a foreign corporation to transact
business and is in good standing in each jurisdiction in which this
qualification or authorization is required by law and in which the failure so to
qualify or be authorized would have a material adverse effect on the Condition
of Dynacs or FX.
5.7 No Conflicts. The execution, delivery and performance by Dynacs
and FX of this Agreement and each other agreement to be delivered by Dynacs and
FX pursuant to this Agreement, the compliance by Dynacs and FX with the terms
and provisions of this Agreement and
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each other agreement to be delivered by Dynacs and FX pursuant to this
Agreement, and the consummation of the Contemplated Transactions do not and will
not (i) violate any provision of the respective Charter Documents of Dynacs or
any of its Subsidiaries or FX; (ii) require Dynacs or any of its Subsidiaries or
FX to obtain any consent, approval or action of, or make any filing with or give
any notice to, any Governmental Body or any Person, including, without
limitation, the SBA, except where the failure to do so would not, individually
or in the aggregate, have a material adverse effect on the Condition of Dynacs;
(iii) violate, conflict with or result in the breach of any of the terms of,
result in a material modification or acceleration of the effect of, otherwise
cause the termination of or give any other contracting party the right to
terminate or a right of first refusal, or constitute (or with notice or lapse of
time or both, constitute) a default under, any Dynacs Material Contract to which
Dynacs or any of its Subsidiaries or FX is a party or by or to which Dynacs or
any of its Subsidiaries or FX or any of their respective assets or properties
may be bound or subject, or result in the creation of any Lien upon the assets
or properties of Dynacs or any of its Subsidiaries or FX pursuant to the terms
of any Dynacs Material Contract; (iv) violate any Law or Order against, or
binding upon, Dynacs or any of its Subsidiaries or FX or upon their respective
securities, properties or business, except where such violation would not,
individually or in the aggregate, have a material adverse effect on the
Condition of Dynacs; (v) violate or result in the revocation or suspension of
any Permit, including, without limitation, any Permit under the 8(a) Program,
except where such violation, revocation or suspension would not, individually or
in the aggregate, have a material adverse effect on the Condition of Dynacs; or
(vi) have a material adverse effect on Dynacs' participation in the 8(a)
Program.
5.8 Capital Stock of Dynacs. The authorized capital stock of Dynacs
consists solely of 10,000,000 shares of Dynacs Common Stock, of which only
4,453,750 shares are issued and outstanding (the "Dynacs Shares"). All of the
Dynacs Shares have been duly authorized and are validly issued, fully paid and
non-assessable. Except as contemplated by this Agreement or any other agreement
to be delivered pursuant to this Agreement or as set forth in the Dynacs
Disclosure Letter, there are no shares of capital stock of Dynacs reserved for
issuance. Except as contemplated by this Agreement or any other agreement to be
delivered pursuant to this Agreement or as set forth in the Dynacs Disclosure
Letter, there are no options, warrants, agreements, convertible securities,
exchangeable securities, commitments or other rights outstanding which afford
any Person the right to purchase or otherwise acquire from Dynacs or any of its
Subsidiaries any shares of Dynacs Common Stock or any other equity security of
Dynacs or any of its Subsidiaries or that give any Person the right to receive
any benefits or rights similar to any rights enjoyed by or accruing to the
holders of shares of capital stock of Dynacs or any of its Subsidiaries. Except
as contemplated by this Agreement or any other agreement to be delivered
pursuant to this Agreement or as set forth in the Dynacs Disclosure Letter,
there are no options, warrants, agreements, convertible securities, exchangeable
securities, commitments or other rights outstanding pursuant to which Dynacs or
any of its Subsidiaries may become obligated to purchase or redeem any shares of
capital stock or other securities of Dynacs or any of its Subsidiaries. There
are no outstanding bonds, debentures, notes or other indebtedness having the
right to vote on any matters on which the stockholders of Dynacs may vote. The
Dynacs Shares constitute all of the outstanding capital stock of Dynacs. The
Dynacs Shares are owned of record and beneficially by, and in the amounts set
forth opposite the names of, the Persons set forth in the Dynacs Disclosure
Letter. The Dynacs Shares have not been issued in violation of, and, except as
contemplated by this Agreement or any other agreement to be delivered pursuant
to this Agreement or as set forth in the Dynacs Disclosure Letter, neither the
Dynacs Shares
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nor any shares of capital stock of any Subsidiary of Dynacs are subject to, any
purchase option, call, right of first refusal, preemptive right, subscription or
similar right under any provision of applicable law, the Charter Documents of
Dynacs, any Contract to which Dynacs or any of its Subsidiaries is a party or by
or to which Dynacs or any of its Subsidiaries or any of their respective assets
or properties may be bound or subject or otherwise. Other than this Agreement
and any other agreement to be delivered pursuant to this Agreement, neither the
Dynacs Shares nor any shares of capital stock of any Subsidiary of Dynacs are
subject to any voting trust agreement or, to the knowledge of Dynacs, any other
Contract, arrangement, commitment or understanding, including any Contract,
arrangement, commitment or understanding restricting or otherwise relating to
the voting, dividend rights or disposition of the Dynacs Shares or any shares of
capital stock of any Subsidiary of Dynacs. Other than under the Registration
Agreement, Dynacs has not agreed to register under the Securities Act any of its
authorized or outstanding securities.
5.9 Capital Stock of FX. FX is authorized to issue 100,000 shares of
FX Common Stock, of which the 20,000 and 80,000 shares of FX Common Stock to be
issued to the Members and Dynacs, respectively, at the Closing (collectively,
the "FX Shares") shall be the only shares of FX Common Stock outstanding
immediately following the Closing. As of the Closing Date, the FX Shares will be
duly authorized and, when issued in exchange for the Membership Interests and
the Digital Shares pursuant to the terms of this Agreement, will be validly
issued, fully paid and non-assessable and will be free and clear of all Liens
and restrictions other than Liens that might have been created by the Members or
Dynacs, restrictions imposed by this Agreement or any other agreement delivered
pursuant to this Agreement and restrictions generally imposed by the securities
laws of the United States and of the various states. At the Closing, the FX
Shares will be the only shares of capital stock of FX reserved for issuance.
There are no options, warrants agreements, convertible securities, exchangeable
securities, commitments or other rights outstanding which afford any Person the
right to purchase or otherwise acquire from FX any shares of FX Common Stock or
any other equity security of FX or that give any Person the right to receive any
benefits or rights similar to any rights enjoyed by or accruing to the holders
of shares of capital stock of FX. There are no options, warrants, agreements,
convertible securities, exchangeable securities, commitments or other rights
outstanding pursuant to which FX may become obligated to purchase or redeem any
shares of capital stock or other securities of FX. There are no outstanding
bonds, debentures, notes or other indebtedness having the right to vote on any
matters on which stockholders of FX may vote. FX has not agreed to register
under the Securities Act any of its authorized or outstanding securities.
5.10 Charter Documents and Corporate Records. Dynacs has previously
delivered to Cerulean and the Member Representative true and complete copies of
the Charter Documents of Dynacs and each of its Subsidiaries and FX, all as in
effect on the date of this Agreement. The minute books of Dynacs and each of its
Subsidiaries and FX have been made available to each of Cerulean and the Member
Representative for their inspection. The stock books of Dynacs and each of its
Subsidiaries and FX have been made available to Cerulean and the Member
Representative and are true and complete in all material respects.
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5.11 Financial Statements
(a) Audited Financials. The audited consolidated balance
sheets of Dynacs as at December 31, 1997 and 1996, and the related statements of
income and retained earnings and cash flows for the fiscal years then ended,
including the notes (and schedules) to these financial statements, certified by
independent certified public auditors to Dynacs, have previously been delivered
to Cerulean and the Member Representative. (These financial statements of
Dynacs, including the notes (and schedules), are sometimes referred to in this
Agreement as the "Dynacs Audited Financials".) The Dynacs Audited Financials
fairly present the financial position and results of operations of Dynacs as at
the dates of and for the periods set forth in the Dynacs Audited Financials in
accordance with GAAP.
(b) Financials. The unaudited consolidated balance sheets of
Dynacs and its Subsidiaries as at December 31, 1998 and May 31, 1999 and the
related consolidated statements of income and retained earnings for the twelve
months ended December 31, 1998 and the five months ended May 31, 1999 have
previously been delivered to Cerulean and the Member Representative. (The
unaudited financial statements of Dynacs and its Subsidiaries for the twelve
months ended December 31, 1998 and the five months ended May 31, 1999 are
sometimes referred to in this Agreement as the "Dynacs Financials", and the
balance sheet as at May 31, 1999 included in the Dynacs Financials is sometimes
referred to in this Agreement as the "Dynacs Balance Sheet".) The Dynacs
Financials have been prepared in accordance with GAAP (with the only exceptions
that no notes nor statements of cash flows have been prepared with respect to
the Dynacs Financials), consistent with the Dynacs Audited Financials, and
fairly present the financial position and results of operations of Dynacs and
its Subsidiaries as at and for the periods set forth in the Dynacs Financials,
and are not subject to year-end adjustments except for normal year-end
adjustments that may be required in the ordinary course of business.
5.12 No Material Adverse Change. Since December 31, 1998, the
business of Dynacs and each Subsidiary of Dynacs has been conducted in the
ordinary course consistent with past practice and there has been no material
adverse change in the Condition of Dynacs, and Dynacs does not know of any
material adverse change in the Condition of Dynacs which is threatened, nor has
there been any damage, destruction or loss which could have or has had a
material adverse effect on the Condition of Dynacs, whether or not covered by
insurance.
5.13 Compliance with Laws. Except where the failure to be in
compliance would not, individually or in the aggregate, have a material adverse
effect on the Condition of Dynacs, Dynacs and each of its Subsidiaries and their
respective officers, employees, agents and representatives, are and at all times
have been in compliance in all material respects with all applicable Laws and
Orders relating to Dynacs or the respective Subsidiary or the conduct of their
respective businesses or operations or the use of their respective assets or
properties, including, without limitation, (i) regulations and requirements of
the Occupational Safety and Health Administration or (ii) any Safety and
Environmental Laws. There are no bases or grounds for any Action with respect
to Dynacs or any of its Subsidiaries relating to, or arising under, any Law or
Order. which, individually or in the aggregate, could have a material adverse
effect on the Condition of Dynacs, and Dynacs has not received and does not know
of the issuance of any written notice of any violation or alleged violation of
any Law or Order by any Governmental Body.
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5.14 Permits. Dynacs and each of its Subsidiaries have all Permits
that are material to the conduct of their respective businesses including,
without limitation, all Permits relating to compliance with Safety and
Environmental Laws and all Permits necessary for Dynacs to continue to perform
under all executory Contracts awarded to Dynacs under the 8(a) Program. All of
the forgoing Permits are in full force and effect; no material violations have
been recorded or exist in respect of any of these Permits; and no proceeding is
pending or, to the knowledge of Dynacs, threatened, to revoke or limit any
Permit. Dynacs has not received any notice from any source to the effect that
there is lacking any material Permit required in connection with the current use
or operation of the assets, properties or business of Dynacs or any of its
Subsidiaries.
5.15 Orders and Actions. There are no outstanding Orders against or
involving Dynacs or any of its Subsidiaries. There are no Actions (whether or
not the defense of the Action or liabilities in respect of the Action are
covered by insurance) pending or, to the knowledge of Dynacs, threatened,
against or involving or affecting Dynacs or any of its Subsidiaries or any of
their respective assets or properties which seek to invalidate the Contemplated
Transactions or to recover any Damages or to obtain any other relief as a result
of this Agreement or the Contemplated Transactions, or which, individually or in
the aggregate, could have a material adverse effect upon the Condition of Dynacs
or upon the consummation of the Contemplated Transactions. To the knowledge of
Dynacs, there is no fact, event or circumstance that may give rise to any Action
described in the immediately preceding sentence. All notices required to have
been given to any insurance company listed as insuring against any Action have
been timely and duly given and no insurance company has asserted, orally or in
writing, that any Action is not covered by the applicable policy relating to the
Action. There are no Actions pending or, to the knowledge of Dynacs, threatened,
that would give rise to any right of indemnification on the part of any director
or officer of Dynacs or any of its Subsidiaries or the heirs, executors or
administrators of a director or officer of Dynacs or any of its Subsidiaries,
against Dynacs or any of its Subsidiaries or any successor to the business of
Dynacs or any of its Subsidiaries.
5.16 Dynacs Material Contracts. The Dynacs Disclosure Letter
contains a true and complete list of all Dynacs Material Contracts to which
Dynacs or any of its Subsidiaries is a party or by or to which any of their
respective assets or properties are bound or subject. Dynacs has made available
to Cerulean and the Member Representative true and complete copies of all of the
Dynacs Material Contracts set forth in the Dynacs Disclosure Letter. All of the
Dynacs Material Contracts referred to in the Dynacs Disclosure Letter are valid
and binding upon Dynacs or the Subsidiary and, to the knowledge of Dynacs, on
the other parties to the Dynacs Material Contracts in accordance with their
terms. Neither Dynacs nor any of its Subsidiaries is in default in any material
respect under any of Dynacs Material Contract, nor does any condition exist that
with notice or lapse of time or both would constitute a material default under
any Dynacs Material Contract or that would give to any party to any Dynacs
Material Contract any right of termination, first refusal, cancellation,
acceleration or modification of the Dynacs Material Contract. To the knowledge
of Dynacs, no other party to any Dynacs Material Contract is in default under
any Dynacs Material Contract in any material respect nor does any condition
exist that with notice or lapse of time or both would constitute a default under
any Dynacs Material Contract.
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5.17 Real Property.
(a) Owned Real Property. The real estate listed in the Dynacs
Disclosure Letter constitutes all of the real property owned by Dynacs or any of
its Subsidiaries (the land, buildings and other improvements covered by the real
estate listed in the Dynacs Disclosure Letter are referred to in this Agreement
as the "Dynacs Owned Real Property"). Each of Dynacs and its Subsidiaries owns
good and marketable fee simple title to all of the Dynacs Owned Real Property
owned by it, and each of Dynacs and its Subsidiaries has received all deeds,
assignments, bills of sale and other documents, and has dully effected all
recordings, filings and other actions necessary to establish, protect and
perfect Dynacs' and its Subsidiaries' rights, title and interest in and to all
of the Dynacs Owned Real Property. No portion of any Dynacs Owned Real Property
has suffered any material damage by fire or other casualty loss which has not
prior to the date of this Agreement been repaired and restored in all material
respects to its original condition or otherwise remedied. All material permits
required to have been issued or appropriate to enable the Dynacs Owned Real
Property to be lawfully occupied and used for all of the purposes for which the
Dynacs Owned Real Property is currently occupied and used have been lawfully
issued and are in full force and effect. Except as set forth on the Dynacs
Disclosure Letter, there is no underlying mortgage, deed of trust, lease, grant
of term or other estate in or interest affecting any Dynacs Owned Real Property
which was granted by Dynacs or any of its Subsidiaries. There are no leases,
subleases, licenses or other agreements granting to any Person other than Dynacs
or any of its Subsidiaries the right to possession, use, occupancy or enjoyment
of any Dynacs Owned Real Property or portion of any Dynacs Owned Real Property.
(b) Leased Real Property. Dynacs has made available to
Cerulean and the Member Representative true, correct and complete copies of all
leases, subleases, licenses and other agreements (including all modifications,
amendments and supplements thereto) (collectively, the "Dynacs Real Property
Leases") under which Dynacs or any of its Subsidiaries uses or occupies or has
the right to use or occupy, now or in the future, any real property (the land,
buildings and other improvements covered by the Dynacs Real Property Leases are
referred to in this Agreement as the "Dynacs Leased Real Property", and the
Dynacs Owned Real Property and the Dynacs Leased Real Property are collectively
referred to in this Agreement as the "Dynacs Real Property"). Each Dynacs Real
Property Lease is valid, binding and in full force and effect and covers the
entire estate it purports to cover, all rent and other sums and charges payable
by Dynacs or any of its Subsidiaries as tenant under each Dynacs Real Property
Lease are current, no notice of default or termination under any Dynacs Real
Property Lease is outstanding, no termination event or condition or uncured
default on the part of Dynacs or any of its Subsidiaries or, to the knowledge of
Dynacs, the landlord, exists under any Dynacs Real Property Lease, and no event
has occurred and no condition exists which, with the giving of notice or the
lapse of time or both, would constitute a default or termination event or
condition under any Dynacs Real Property Lease. There is no underlying mortgage,
deed of trust, lease, grant of term or other estate in or interest affecting any
Dynacs Leased Real Property which was granted by Dynacs or any of its
Subsidiaries and which is superior to the interest of Dynacs or any of its
Subsidiaries as tenant under the applicable Dynacs Real Property Lease. Neither
Dynacs nor any Subsidiary of Dynacs has any ownership, financial or other
interest in the landlord under any Dynacs Real Property Lease. There are no
leases, subleases, licenses or other agreements granting to any Person other
than Dynacs or any of its Subsidiaries the right to possession, use, occupancy
or enjoyment of any Dynacs Leased Real Property or portion of any Dynacs Leased
Real Property.
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5.18 Environmental Compliance Matters. (1) Dynacs has inspected the
Dynacs Real Property and has no reason to believe that there may be Hazardous
Substances incorporated in or deposited, stored or buried at or upon any Dynacs
Real Property; (2) to the knowledge of Dynacs, no Dynacs Real Property has ever
been used as a waste disposal site or a storage site for petroleum products or
chemicals; (3) to the knowledge of Dynacs, no existing structures on any Dynacs
Real Property contain asbestos; (4) to the knowledge of Dynacs, there are not
now any underground storage tanks on any Dynacs Real Property; (5) neither
Dynacs nor any Subsidiary of Dynacs has allowed, with the knowledge or consent
of Dynacs or the Subsidiary, any Person occupying any Dynacs Real Property to
bring Hazardous Substances onto any Dynacs Real Property or to process or store
any Hazardous Substances on any Dynacs Real Property and, to the knowledge of
Dynacs, no Hazardous Substance has been released into the environment by Dynacs
or any of its Subsidiaries that may present an imminent and substantial
endangerment to human health; (6) Dynacs is not aware of any complaints on file
or matters pending in any federal or state environmental protection offices
involving any allegation of Hazardous Substances on any Dynacs Real Property;
and (7) Dynacs has not received notice from any environmental board, agency or
authority requiring the removal of any Hazardous Substances or other alleged
harmful materials or wastes, or advising of any pending or contemplated search
or investigation of the Dynacs Real Property or any portion of the Dynacs Real
Property with respect the removal of any Hazardous Substances or other alleged
harmful materials or wastes.
5.19 Receivables. All accounts and notes receivable reflected on the
Dynacs Balance Sheet and all accounts and notes receivable arising subsequent to
May 31, 1999 (i) have arisen in the ordinary course of business of Dynacs and
its Subsidiaries and (ii) are subject only to a reserve for bad debts computed
in a manner consistent with past practice and reasonably estimated to reflect
the probable results of collection, have been collected or are collectible in
the ordinary course of business of Dynacs and its Subsidiaries in the aggregate
recorded amounts thereof in accordance with their terms.
5.20 Tangible Property. The facilities, machinery, equipment,
furniture, leasehold improvements, fixtures, vehicles, structures, any related
capitalized items and other tangible property material to the business of Dynacs
and its Subsidiaries are in good operating condition and repair, subject to
continued repair and replacement in accordance with past practice, and are
suitable for their intended use.
5.21 Intangible Property. The Dynacs Disclosure Letter sets forth
all patents, trademarks, copyrights, service marks, trade names and franchises,
all applications for any of the foregoing, and all permits, grants and licenses
or other rights running to or from Dynacs or any Subsidiary of Dynacs relating
to any of the foregoing and any other names used by Dynacs or any Subsidiary of
Dynacs in connection with their respective business (the "Dynacs Intangible
Property"). Dynacs and each of its Subsidiaries has the right to use, free and
clear of any Lien or rights of others, all of the Dynacs Intangible Property and
all trade secrets, inventions, know-how, processes, technology, blueprints and
designs utilized in or incident to its businesses as presently conducted or as
being developed ("Dynacs Trade Secrets"). There is no other Dynacs Intangible
Property which is material to the business of Dynacs or any of its Subsidiaries
as presently conducted or as being developed. Neither Dynacs nor any Subsidiary
of Dynacs has notice of any adversely held invention,
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trademark, service mark. copyright or trade name of any other Person or notice
of. and there is no present or threatened use or encroachment of, any claim of
any other Person relating to any of the Dynacs Intangible Property or any Dynacs
Trade Secret or confidential information of Dynacs or any Subsidiary of Dynacs,
and Dynacs does not know of any basis for any of these charges or claims. All of
the Permits, grants and licenses or other rights relating to any of the
foregoing and set forth on the Dynacs Disclosure Letter are valid and binding
upon Dynacs and its Subsidiaries in accordance with their terms. Neither Dynacs
nor any of its Subsidiaries is in default in any material respect under any of
the Dynacs Intangible Property or any Dynacs Trade Secret, nor does any
condition exist that with notice or lapse of time or both would constitute a
material default under any of the Dynacs Intangible Property or any Dynacs Trade
Secret. To the knowledge of Dynacs, no other party is in default under any of
the Dynacs Intangible Property or any Dynacs Trade Secret in any material
respect nor does any condition exist that with notice or lapse of time or both
would constitute a material default by any other party under any of the Dynacs
Intangible Property or any Dynacs Trade Secret.
5.22 Title to Assets and Properties. Dynacs and each of its
Subsidiaries each has good and marketable title to, or a valid right to use, all
assets and properties used by it in the conduct of its business, free and clear
of any Lien other than Liens which would not, individually or in the aggregate,
have a material adverse effect on the Condition of Dynacs. No mortgage, trust
deed, chattel mortgage, security agreement, financing statement or other
instrument encumbering any of these assets has been recorded, filed, executed or
delivered.
5.23 Liabilities. Neither Dynacs nor any Subsidiary of Dynacs has
any Liabilities that were not fully and adequately reflected or reserved
against on the Dynacs Balance Sheet or described in the notes to the Dynacs
Financials and Dynacs Audited Financials, except for (i) Contracts entered into
in the ordinary course of business which are not required to be disclosed on
the Dynacs Disclosure Letter (none of which are reflected in the Dynacs
Financials or the Dynacs Audited Financials) and (ii) current Liabilities
incurred in the ordinary course of business since May 31, 1999, which are
properly reflected on Dynacs' books and records and which are not inconsistent
with the other representations, warranties and agreements of Dynacs and its
Subsidiaries set forth in this Agreement. Dynacs has no knowledge of any
circumstance, condition, event or arrangement that may hereafter give rise to
any Liabilities of Dynacs or any of its Subsidiaries except in the ordinary
course of business.
5.24 Employee Benefits. Dynacs has made available to Cerulean and
the Member Representative true and correct copies of all plans and other
arrangements involving direct or indirect compensation or benefits to directors,
officers or consultants or providing employee benefits to employees of Dynacs or
any Subsidiary of Dynacs, including, without limitation, all "employee benefit
plans" as defined in Section 3(3) of ERISA, and all bonus, stock option, stock
purchase, incentive, deferred compensation, supplemental retirement, severance
and other similar fringe or employee benefit plans, and all employment or
executive compensation agreements (collectively, the "Dynacs Plans"). All Dynacs
Plans comply with and are and have been operated in material compliance with
each applicable provision of ERISA, the Code, other federal statutes, state
law (including, without limitation, state insurance law) and the regulations and
rules promulgated pursuant thereto or in connection therewith, except for any
failure to comply which would not have a material adverse effect on the
Condition of Dynacs. No Dynacs Plan is covered by Title IV of ERISA or Section
412 of the Code. None of Dynacs, any Subsidiary of Dynacs or any ERISA Affiliate
of Dynacs has failed to
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make any contributions or to pay any amounts due and owing as required by the
terms of any Dynacs Plan, which failure would have a material adverse effect on
the Condition of Dynacs. Except as required by Section 4980B of the Code, none
of Dynacs, any Subsidiary of Dynacs or any ERISA Affiliate of Dynacs has
promised any former employee or other individual not employed by Dynacs, any
Subsidiary of Dynacs or any ERISA Affiliate of Dynacs medical or other benefit
coverage, and none of Dynacs, any Subsidiary of Dynacs or any ERISA Affiliate of
Dynacs maintains or contributes to any plan or arrangement providing medical
benefits, life insurance or other welfare benefits to former employees, their
spouses or dependents or any other individual not employed by Dynacs, any
Subsidiary of Dynacs or any ERISA Affiliate of Dynacs excepto the extent
required by applicable law.
5.25 Employee Relations. Within the last two years, none of the
employees of Dynacs or any Subsidiary of Dynacs are or have been represented by
any union or collective bargaining group or association with respect to their
employment with Dynacs or any Subsidiary of Dynacs and neither Dynacs nor any
Subsidiary of Dynacs is, or has been, engaged in, or has planned or is planning
to engage in, any arrangement or agreement with any union or collective
bargaining group or association. There is no organizing activity involving
Dynacs or any of its Subsidiaries that is pending or threatened by any labor
organization or group of employees. There are no representation proceedings
pending or threatened before the National Labor Relations Board, and no labor
organization or group of employees of Dynacs or any Subsidiary of Dynacs has
made a pending demand for recognition. To the knowledge of Dynacs, neither
Dynacs nor any Subsidiary of Dynacs has engaged during the last two years, or is
engaged, in any unfair labor practice and there are no pending or, to the
knowledge of Dynacs, threatened, unfair labor practice charges or any other
employee-related charges or complaints against Dynacs or any of its Subsidiaries
before the National Labor Relations Board or any other Governmental Body.
Neither Dynacs nor any Subsidiary of Dynacs has at any time during the last five
years had, or, to the knowledge of Dynacs, is there now threatened, a strike,
picket, work stoppage, work slowdown or other labor trouble that had or may have
a material adverse effect on the Contemplated Transactions or the Condition of
Dynacs.
5.26 Insurance. Dynacs has made available to Cerulean and the Member
Representative a true and correct list of all policies of insurance, including
the types and coverage amounts of the insurance, owned by Dynacs or any of its
Subsidiaries or in which Dynacs or any Subsidiary of Dynacs is named as an
insured party or beneficiary, in each case in connection with Dynacs' business.
True and correct copies of all of these policies have been made available to
Cerulean and the Member Representative. All of these policies are in full force
and effect and neither Dynacs nor any Subsidiary of Dynacs has received any
notice of cancellation of any of these insurance policies.
5.27 Operations of Dynacs. Since May 31, 1999, Dynacs and each of
its Subsidiaries have conducted their respective businesses in all material
respects in the ordinary and usual course consistent with past practice, and
there has not been (a) any event or occurrence which could result in a material
adverse effect on the Condition of Dynacs, (b) any material change in accounting
methods, principles and practices by Dynacs or any of its Subsidiaries (except
for any changes required by reason of a concurrent change in GAAP), or (c)
any damage, destruction or loss, whether covered by insurance or not, having a
material adverse effect on the Condition of Dynacs.
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5.28 Subsidiaries and Affiliates. The Dynacs Disclosure Letter lists
each Subsidiary of Dynacs, the total number of authorized shares of capital
stock of each Subsidiary of Dynacs, the total number of issued and outstanding
shares of capital stock of each Subsidiary of Dynacs, and the ownership of all
shares of capital stock of each Subsidiary of Dynacs. Except as disclosed on the
Dynacs Disclosure Letter, neither Dynacs nor any Subsidiary of Dynacs, directly
or indirectly, owns any interest in any other Person nor is Dynacs or any
Subsidiary of Dynacs under common ownership, directly or indirectly, with any
other Person. All of the issued and outstanding shares of capital stock of each
Subsidiary of Dynacs are owned as set forth on the Dynacs Disclosure Letter and
are fully paid and nonassessable. No other class of capital stock or other
ownership interests of any Subsidiary of Dynacs are authorized or outstanding.
As of the Closing, no Subsidiary of Dynacs will be subject to any obligation
(contingent or otherwise), nor will any Subsidiary of Dynacs have any right to
repurchase, redeem, exchange or otherwise acquire any shares of its capital
stock or any securities convertible or exchangeable into or exercisable for any
shares of its capital stock.
5.29 No Brokers. None of Dynacs, any Subsidiary of Dynacs or FX has
entered into any contract, arrangement or understanding with any Person or firm
which may result in the obligation of Cerulean, a Member, FX, Dynacs or any
Subsidiary of Dynacs to pay any finder's fee, brokerage or agent's commissions
or other like payments in connection with the negotiation, execution or
performance of this Agreement and Dynacs is not aware of any claim for any of
these payments.
5.30 Tax Matters. Dynacs and each of its Subsidiaries each (i) has
prepared and duly and timely filed all Tax Returns required to be filed (subject
to any extensions applicable to the Tax Return) and all of these Tax Returns
accurately reflect the Tax liability of Dynacs and its Subsidiaries in all
material respects for the periods to which they relate, (ii) has paid all Taxes
shown to be due and payable on these Tax Returns or which have become due and
payable pursuant to any assessment, deficiency notice, 30-day letter, or other
notice received by it, and (iii) has properly accrued all Taxes for the periods
subsequent to the periods covered by the Tax Returns, except for any Taxes which
would not have a material adverse effect on the Condition of Dynacs. Neither
Dynacs' nor any Subsidiary's Tax Returns have been examined by any appropriate
taxing authority. Neither Dynacs nor any Subsidiary of Dynacs has executed or
filed with the IRS or any other taxing authority any agreement now in effect
extending the period for assessment or collection of any income or other Taxes.
Neither Dynacs nor any Subsidiary of Dynacs is a party to any pending action or
proceeding by any Governmental Body for assessment or collection of Taxes, and
to the knowledge of Dynacs, no claim for assessment or collection of Taxes has
been asserted against Dynacs or any of its Subsidiaries. Dynacs has made
available to Cerulean and the Member Representative true and correct copies of
all Tax Returns with respect to all of the tax years filed by Dynacs or any
Subsidiary of Dynacs within the last three years and all communications relating
to these Tax Returns. All Taxes which Dynacs and any Subsidiary of Dynacs are
required to withhold or collect, including without limitation, sales and use
taxes, have been duly withheld or collected and, to the extent required, have
been paid over to the proper Governmental Body.
5.31 Year 2000 Reprogramming. Any reprogramming required to permit
the proper functioning, in and following the year 2000, of Dynacs' and its
Subsidiaries' (i) computer systems and (ii) equipment containing embedded
microchips (including systems and equipment supplied by others) and the testing
of all such systems and equipment, as so reprogrammed shall be
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completed by April 1, 1999. The costs to Dynacs and its Subsidiaries of such
reprogramming and testing and of the reasonably foreseeable consequences of year
2000 (including. without limitation, reprogramming errors and the failure of
others' systems or equipment) will not have a material adverse effect on the
Condition of Dynacs or any of its Subsidiaries. Except for such of the
reprogramming referred to in the preceding sentence as may be necessary, the
computer and management information systems of the Dynacs and its Subsidiaries
are sufficient to permit Dynacs and its Subsidiaries to conduct its business
substantially as it is conducted on the date hereof.
5.32 Full Disclosure. All Documents (including the schedules and
exhibits to the Documents) delivered by or on behalf of Dynacs or any Subsidiary
of Dynacs in connection with this Agreement and the Contemplated Transactions
are true, complete and authentic or are true and complete copies, in all
material respects, of authentic Documents. No representation or warranty of
Dynacs or FX contained in this Agreement, and no Documents furnished by or on
behalf of Dynacs or any Subsidiary of Dynacs or FX to Cerulean or the Member
Representative pursuant to this Agreement or in connection with the Contemplated
Transactions contains, when read in conjunction with all other papers, an untrue
statement of a material fact or omitted or omits to state a material fact
required to be stated therein or necessary to make the statements made, in the
context in which made, not materially false or misleading. There is no fact that
Dynacs, any Subsidiary of Dynacs or FX has not disclosed to Cerulean or the
Member Representative that materially adversely affects or will materially
adversely affect, the Condition of Dynacs or the consummation of the
Contemplated Transactions.
ARTICLE 6
COVENANTS AND AGREEMENTS
6.1 Affirmative Covenants of Dynacs. From the date of this Agreement
and thereafter until the earlier to occur of (i) the date no Member owns of
record or beneficially any FX Common Stock or any other shares of capital stock
of FX or Dynacs or (ii) a Qualified Public Offering (except in the case of
Section 6.1(a), which shall apply only from the date of this Agreement until the
Closing Date), unless the Member Representative shall otherwise consent prior
thereto in writing, Dynacs shall do the following:
(a) Conduct of Business. Except as specifically permitted by
this Agreement or any agreement delivered pursuant to this Agreement, use its
best efforts to conduct, and cause each of its Subsidiaries to conduct, its
business in the ordinary course.
(b) Maintenance of Corporate Existence. Do all things
necessary to preserve and maintain in good standing its corporate existence,
rights and franchises and the authority necessary to continue the respective
businesses of Dynacs and its Subsidiaries.
(c) Preservation of Business. Use its best efforts to preserve
its and each of its Subsidiaries' assets and properties and keep its business
organizations intact, keep available the services of its present officers,
employees, consultants and agents, maintain its present suppliers, customers and
licensors and preserve its goodwill, and refrain from actions that may not
preserve
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Dynacs' or any of its Subsidiaries' business as provided in this Agreement,
other than actions or omissions to act which would not have a material adverse
effect on the Condition of Dynacs or any of its Subsidiaries.
(d) Information and Reports to Be Furnished. Maintain a system
of accounting in which full, true and correct entries will be made in accordance
with GAAP of all dealings and transactions in relation to its business and
affairs and set aside on its books all proper reserves as shall be required by
GAAP; in this regard, furnish to the Members the following financial statements,
notices and requests, all of which shall be prepared in accordance with GAAP
(except as noted in this Section 6.1(d)):
(i) Annual Statements. As soon as practicable after the
end of each fiscal year of Dynacs and in any event within one hundred twenty
(120) days thereafter, consolidated balance sheets of Dynacs and its
Subsidiaries as at the end of each fiscal year, consolidated statements of
income and retained earnings and cash flows of Dynacs and its Subsidiaries for
each fiscal year setting forth in each case the corresponding figures, if any,
for the preceding fiscal year, certified by a firm of independent certified
public auditors acceptable to the Member Representative.
(ii) Quarterly Reports. As soon as practicable after the
end of each fiscal quarter and in any event within forty-five (45) days
thereafter (with a 5 day grace period if circumstances require), consolidated
balance sheets of Dynacs and its Subsidiaries as at the end of each fiscal
quarter and consolidated statements of income and retained earnings of Dynacs
and its Subsidiaries for each fiscal quarter and the fiscal year to that date
that provide comparisons to the corresponding information contained in Dynacs'
and its Subsidiaries' comparable statements for the prior year and in Dynacs'
annual budget for the period to which the statements refer, subject to changes
resulting from year-end adjustments, together with a statement of projections of
receipts and disbursements for the three month period subsequent to the end of
each fiscal quarter, with these balance sheets and statements to be prepared and
certified by the Chief Financial Officer of Dynacs as complete and accurate to
the best of his information and belief and to be in form satisfactory to the
Member Representative.
(iii) Other Reports. As soon as available, all budgets
for Dynacs and its Subsidiaries delivered to Dynacs' directors, officers and/or
shareholders (including all balance sheets, statements of income and retained
earnings and cash flows, capital expenditure reports and other financial matters
prepared and/or delivered in connection therewith); all management letters
prepared by Dynacs' auditors and the management's responses to these letters;
copies of all communications, notices, reports, documents or demands received by
Dynacs or any of its Subsidiaries in connection with this Agreement or the
Contemplated Transactions; with reasonable promptness, any other information
respecting the business, operations and Condition of Dynacs or any of its
Subsidiaries as the Member Representative may from time to time reasonably
request or may be required to supply to any Governmental Body.
(e) Board of Directors' Meetings. Hold meetings of the Board
of Directors of Dynacs and FX at least once every calendar quarter and reimburse
each director who is not an employee of Dynacs or FX for the reasonable
out-of-pocket expenses incurred by the director in attending each meeting.
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6.2 Negative Covenants of Dynacs. Following the Closing and
thereafter until the earlier to occur of (i) the date no Member owns of record
or beneficially any FX Common Stock or any other shares of capital stock of FX
or (ii) a Qualified Public Offering, unless the Member Representative shall
otherwise consent prior thereto in writing, Dynacs shall not do any of the
following:
(a) Additional FX Stock. Cause or permit FX to issue, sell or
otherwise dispose of, or purchase, redeem or otherwise acquire any shares of
capital stock of FX, or grant, or cause or permit FX to grant, any right (or the
preemptive right) or any option to subscribe for or purchase, or enter into, or
cause or permit FX to enter into, any agreement for the issuance (contingent or
otherwise) of, or create, or cause or permit FX to create, any call, commitment,
stock appreciation right, claim or other right of any character relating to, any
shares of capital stock of FX.
(b) Sale of FX. (i) Sell, transfer or otherwise dispose of any
shares of capital stock of FX held by Dynacs, (ii) cause or permit FX to merge
or consolidate FX, or (iii) cause or permit FX to effect any transfer, sale,
assignment, lease or other disposition of all or substantially all of any
material part of the assets or properties of FX.
6.3 Affirmative Covenants of Cerulean. From the date of this
Agreement and thereafter until the Closing Date, unless Dynacs shall otherwise
consent prior thereto in writing, Cerulean shall do the following:
(a) Conduct of Business. Except as specifically permitted by
this Agreement or any agreement delivered pursuant to this Agreement, use its
best efforts to conduct its business in the ordinary course.
(b) Maintenance of Corporate Existence. Do all things
necessary to preserve and maintain in good standing its corporate existence,
rights and franchises and the authority necessary to continue its business.
(c) Preservation of Business. Use its best efforts to preserve
its assets and properties and keep its business organizations intact, keep
available the services of its present officers, employees, consultants and
agents, maintain its present suppliers, customers and licensors and preserve its
goodwill, and refrain from actions that may not preserve Cerulean's business as
provided in this Agreement, other than actions or omissions to act which would
not have a material adverse effect on the Condition of Cerulean.
6.4 Salaries of Cerulean. From the date of this Agreement and
thereafter until the Closing Date, unless Dynacs shall otherwise consent prior
thereto in writing, Cerulean shall not, other than in the ordinary course of
business consistent with past practice or as contemplated by this Agreement,
increase by more than 10% the compensation payable or to become payable by
Cerulean to any member, officer or employee of Cerulean.
6.5 Resignation of Burns as Manager. Burns agrees to resign, and
shall resign, as Manager of Cerulean on the Closing Date.
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6.6 Shareholders Agreement. The Members and Dynacs agree to enter
into, and shall enter into, on the Closing Date, the Shareholders Agreement in
form and substance identical to Exhibit B attached to this Agreement. Dynacs
agrees to use its best efforts to cause the capital stockholders of Dynacs who
are identified as parties to the Shareholders Agreement to enter into the
Shareholders Agreement on the Closing Date.
6.7 Registration Agreement. The Members and Dynacs agree to enter
into, and shall enter into, on the Closing Date, the Registration Agreement in
form and substance identical to Exhibit C attached to this Agreement.
6.8 Exchange Agreement. The Members and Dynacs agree to enter into,
and shall enter into, on the Closing Date, the Exchange Agreement in form and
substance identical to Exhibit D attached to this Agreement.
6.9 Loan to Burns. Dynacs agrees to loan to Burns the principal
amount of $600,000 (the "Loan"), which Loan shall delivered to Burns in
accordance with the following payment schedule:
(a) $300,000 shall be paid to Burns on August 30, 1999;
(b) $150,000 shall be paid to Burns on January 10, 2000; and
(c) $150,000 shall be paid to Burns on January 10, 2001.
The Loan will be made upon the terms set forth in the Non-Recourse Secured
Promissory Note in form and substance identical to Exhibit F attached to this
Agreement (the "Promissory Note"), and will be secured pursuant to the Pledge
and Security Agreement in form and substance identical to Exhibit G attached to
this Agreement (the "Security Agreement"). Burns agrees to enter into, and shall
enter into on the Closing Date, the Promissory Note and the Security Agreement.
6.10 First Refusal Agreement. Burns and Dynacs agree to enter into,
and shall enter into, on the Closing Date, the First Refusal Agreement in form
and substance identical to Exhibit E attached to this Agreement.
6.11 Further Assurances. Each of the parties shall execute any
documents and other papers and perform any further acts as may be reasonably
required or desirable to carry out the provisions of this Agreement and the
Contemplated Transactions. Each party shall use its best efforts to fulfill or
obtain the fulfillment of the conditions to the Closing including, without
limitation, the execution and delivery of any Documents, the execution and
delivery of which are conditions precedent to the Closing.
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ARTICLE 7
CONDITIONS PRECEDENT TO THE OBLIGATIONS
OF FX AND DYNACS TO CLOSE
The obligations of FX and Dynacs to enter into and complete the
Closing is subject to the satisfaction on the Closing Date of the following
conditions, any one or more of which may be waived by either of them:
7.1 Representations, Warranties and Covenants True. The
representations and warranties of Cerulean and the Members contained in this
Agreement shall be true and correct in all material respects on and as of the
Closing Date with the same force and effect as if made on and as of the Closing
Date. Each of Cerulean and the Members shall have performed and complied in all
material respects with all covenants and agreements required by this Agreement
to be performed or complied with by them on or prior to the Closing Date.
Cerulean shall have delivered to FX and Dynacs a certificate, dated the Closing
Date and signed by the Manager of Cerulean on its behalf, to the foregoing
effect, and the Member Representative shall have delivered a like certificate to
each of FX and Dynacs.
7.2 Approvals and Consents. Cerulean shall have delivered to FX and
Dynacs original executed copies or other evidence reasonably satisfactory to it
of all approvals and consents required from any Governmental Body or any other
Person whose consent is required to effect the terms and conditions of this
Agreement or the Contemplated Transactions.
7.3 Shareholders Agreement. The Members shall have executed and
delivered the Shareholders Agreement to Dynacs and to the capital stockholders
of Dynacs who are identified as parties to the Shareholders Agreement.
7.4 Registration Agreement. The Members shall have executed and
delivered to Dynacs the Registration Agreement.
7.5 Exchange Agreement. The Members shall have executed and
delivered to Dynacs the Exchange Agreement.
7.6 Promissory Note and Security Agreement. Burns shall have
executed and delivered to Dynacs the Promissory Note and the Security Agreement.
7.7 First Refusal Agreement. Burns shall have executed and delivered
to Dynacs the First Refusal Agreement.
7.8 Resignation of Burns as Manager. Burns shall have resigned as
Manger of Cerulean.
7.9 Delivery of the Membership Interests. The Members shall have
delivered the Membership Interests to FX against delivery of the FX Common Stock
as contemplated in Article 1.
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7.10 Delivery of the FX Common Stock. FX shall have delivered the FX
Common Stock to Dynacs against delivery of the Digital Shares as contemplated in
Article 1.
7.11 Articles of Incorporation of Dynacs. The Amended and Restated
Articles of Incorporation of Dynacs substantially in the form attached hereto as
Exhibit H shall have been filed (and become effective) with the Secretary of
State of the State of Florida.
7.12 Opinion of Counsel to Cerulean. Dynacs shall have received the
favorable opinion of Troop Steuber Pasich Reddick & Tobey, LLP, Los Angeles,
California, counsel to Cerulean, dated the Closing Date and addressed to Dynacs,
in the form of Exhibit I
7.13 Accounts Payable. To the extent not included in the Cerulean
Disclosure Letter, Cerulean shall have delivered to Dynacs a schedule dated
within 5 business days prior to the Closing Date which sets forth a true and
complete schedule of the accounts payable of Cerulean as of such date, setting
forth a description of the accounts payable including the names of the account
creditors and the balance amount. The accounts payable of Cerulean created after
the date of this Agreement shall have arisen in the ordinary course of business
of Cerulean consistent with past practice.
ARTICLE 8
CONDITIONS PRECEDENT TO THE OBLIGATIONS
OF CERULEAN AND THE MEMBERS TO CLOSE
The obligations of Cerulean and the Members to enter into and
complete the Closing is subject to the fulfillment on or prior to the Closing
Date of the following conditions, any one or more of which may be waived by the
party so entitled:
8.1 Representations, Warranties and Covenants True. The
representations and warranties of Dynacs contained in this Agreement shall be
true and correct in all material respects on and as of the Closing Date with the
same force and effect as if made on and as of the Closing Date. FX and Dynacs
shall have performed and complied in all material respects with all covenants
and agreements required by this Agreement to be performed or complied with on or
prior to the Closing Date. FX and Dynacs shall have delivered to Cerulean and
the Members a certificate or certificates, dated the date of the Closing and
signed by the authorized representative of FX and Dynacs on their behalf, to the
foregoing effect.
8.2 Approvals and Consents. FX and Dynacs shall have delivered to
the Member Representative original executed copies or other evidence reasonably
satisfactory to him of all approvals and consents required from any Governmental
Body or any other Person whose consent is required to effect the terms and
conditions of this Agreement or the Contemplated Transactions.
8.3 Shareholders Agreement. Dynacs and the capital stockholders of
Dynacs who are identified as parties to the Shareholders Agreement shall have
executed and delivered to the Members the Shareholders Agreement.
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8.4 Registration Agreement. Dynacs shall have executed and delivered
to the Members the Registration Agreement.
8.5 Exchange Agreement. Dynacs and the capital stockholder of Dynacs
who is identified as a party to the Exchange Agreement shall have executed and
delivered to the Members the Exchange Agreement.
8.6 Loan to Burns. Concurrently with Burns' delivery of the
Promissory Note and the Security Agreement to Dynacs, Dynacs shall have
delivered to Burns $300,000 principal amount of the Loan.
8.7 First Refusal Agreement. Dynacs shall have executed and
delivered to Burns the First Refusal Agreement.
8.8 Delivery of FX Common Stock. FX shall have delivered the FX
Common Stock to the Members against delivery of the Membership Interests as
contemplated in Article 1.
8.9 Delivery of Digital Shares. Dynacs shall have delivered the
Digital Shares to FX against delivery of the FX Common Stock as contemplated in
Article 1.
8.10 Articles of Incorporation of Dynacs. The Amended and Restated
Articles of Incorporation of Dynacs substantially in the form attached hereto as
Exhibit H shall have been filed (and become effective) with the Secretary of
State of the State of Florida.
8.11 Opinion of Counsel to Dynacs and FX. The Members shall have
received the favorable opinion of Frankfurt, Garbus Klein & Selz, New York, New
York, counsel to Dynacs and FX, dated the Closing Date and addressed to each of
them, in the form of Exhibit J.
ARTICLE 9
SURVIVAL OF REPRESENTATIONS AND WARRANTIES INDEMNIFICATION
9.1 Survival of Representations and Warranties. All representations
and warranties made in this Agreement or made in any Document delivered pursuant
to this Agreement by or on behalf of any party shall survive the execution and
delivery of this Agreement and the Closing, regardless of notice of or any
investigation or right of investigation made prior to or after the date of this
Agreement by or on behalf of any party, and shall terminate and expire 18 months
following the Closing Date after which date they shall be of no further force or
effect.
9.2 Indemnification
(a) By the Members. Each Member shall, severally but not
jointly, indemnify, save and hold harmless Dynacs, each of its Subsidiaries and
FX and each of their respective Representatives from and against any and all
Damages (whether or not arising out of
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third-party claims) incurred in connection with, arising out of, resulting from
or incident to (i) any breach of any representation or warranty made by the
Member in Article 3 of this Agreement, and (ii) any breach of any covenant or
agreement made by the Member in this Agreement.
(b) By Burns. Burns shall indemnify, save and hold harmless
Dynacs, each of its Subsidiaries and FX and each of their respective
Representatives from and against any and all Damages (whether or not arising out
of third-party claims) incurred in connection with, arising out of, resulting
from or incident to (i) any breach of any representation or warranty made by
Burns in this Agreement, (ii) any breach of any representation or warranty made
by Cerulean in this Agreement, (iii) any breach of any covenant or agreement
made by Burns in this Agreement, and (iv) any breach of any covenant or
agreement made by Cerulean to be performed prior to the Closing pursuant to this
Agreement.
(c) By Dynacs and FX. Dynacs and FX shall indemnify, save and
hold harmless the Members and each of their respective Representatives and all
Representatives of Cerulean from and against any and all Damages (whether or not
arising out of third-party claims) incurred in connection with, arising out of,
resulting from or incident to (i) any breach of any representation or warranty
made by Dynacs or FX in this Agreement, and (ii) any breach of any covenant or
agreement made by Dynacs or FX in this Agreement.
(d) Cooperation The indemnified party shall cooperate in all
reasonable respects with the indemnifying party and his or its Representatives
(including, without limitation, his or its attorneys) in the investigation,
trial and defense of such lawsuit or action and any appeal arising therefrom;
provided, however, that the indemnified party may, at his or its own cost,
participate in negotiations, arbitrations and the investigation, trial and
defense of such lawsuit or action and any appeal arising therefrom. The parties
shall cooperate with each other in any notifications to insurers.
(e) Defense of Claims. If a claim for Damages (a "Claim") is
to be made by a party entitled to indemnification hereunder against the
indemnifying party, the party claiming such indemnification shall give written
notice (a "Claim Notice") to the indemnifying party as soon as practicable after
the party entitled to indemnification becomes aware of any fact, condition or
event which may give rise to Damages for which indemnification may be sought
under this Section 9.2. If any lawsuit or enforcement action is filed against
any party entitled to the benefit of indemnity hereunder, written notice thereof
shall be given to the indemnifying party as promptly as practicable (and in any
event within fifteen (15) calendar days after the service of the citation or
summons). The failure of any indemnified party to give timely notice hereunder
shall not affect rights to indemnification hereunder, except to the extent that
the indemnifying party has been damaged by such failure. After such notice, if
the indemnifying party shall acknowledge in writing to the indemnified party
that the indemnifying party shall be obligated under the terms of its indemnity
hereunder in connection with such lawsuit or action, the indemnifying party
shall be entitled, if it so elects at its own cost, risk and expense, (i) to
take control of the defense and investigation of such lawsuit or action, (ii) to
employ and engage attorneys of its own choice, but, in any event, reasonably
acceptable to the indemnified party, to handle and defend the same unless the
named parties to such action or proceeding (including any impleaded parties)
include both the indemnifying party and the indemnified party and the
indemnified party has been advised in writing by counsel that there may be one
or more legal defenses available to such indemnified party that are different
from or additional to those
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available to the indemnifying party, in which event the indemnified party shall
be entitled, at the indemnifying party's cost, risk and expense, to separate
counsel of its own choosing, and (iii) to compromise or settle such lawsuit or
action, which compromise or settlement shall be made only with the written
consent of the indemnified party, such consent not to be unreasonably withheld.
If the indemnifying party fails to assume the defense of such
lawsuit or action within 15 calendar days after receipt of the Claim Notice, the
indemnified party against which such lawsuit or action has been asserted will
(upon delivering notice to such effect to the indemnifying party) have the right
to undertake, at the indemnifying party's cost and expense, the defense,
compromise or settlement of such lawsuit or action on behalf of and for the
account and risk of the indemnifying party; provided, however, that such lawsuit
or action shall not be compromised or settled without the written consent of the
indemnifying party, which consent shall not be unreasonably withheld. If the
indemnified party settles or compromises such lawsuit or action without the
prior written consent of the indemnifying party, the indemnifying party will
bear no liability hereunder for or with respect to such lawsuit or action. In
the event the indemnified party assumes the defense of the lawsuit or action,
the indemnified party will keep the indemnifying party reasonably informed of
the progress of any such defense, compromise or settlement. The indemnifying
party shall be liable for any settlement of any action effected pursuant to and
in accordance with this Section 9.2 and for any final judgment (subject to any
right of appeal) and the indemnifying party agrees to indemnify and hold
harmless an indemnified party from and against any Damages by reason of such
settlement or judgment.
(f) Exclusive Remedy. The rights and remedies provided in this
Article 9 shall be exclusive as to any Damages incurred by a party under this
Agreement; provided, however, that nothing herein shall preclude a party from
exercising its rights under this Agreement and applicable law to such equitable
remedies, including, without limitation, specific performance and injunctions.
It is specifically understood and agreed that in the event a misrepresentation
is made herein or pursuant hereto or a breach of any representation or warranty
contained herein is discovered by a party hereto and asserted by it after the
Closing, the remedy of such Person shall be limited to indemnification as set
forth in Section 9.2 hereof; and such Person shall not be entitled to the
rescission of this Agreement.
(g) Limitation on Indemnity
(i) The indemnification obligation of the Members, of
Burns and of Dynacs and FX with respect to any breach of any representation or
warranty pursuant to Sections 9.2(a), (b) or (c), respectively, shall be limited
to Claims for Damages made prior to last date of survival of such representation
or warranty referred to in Section 9.1. The indemnification obligation of the
Members, of Burns and of Dynacs and FX with respect to any breach of any
covenant or agreement pursuant to Sections 9.2(a), (b) or (c), respectively,
shall survive indefinitely subject to the terms of this Agreement.
(ii) Dynacs, each of its Subsidiaries and FX and each of
their respective Representatives may not recover, and neither Burns nor the
Members shall be required to pay or otherwise be responsible for, any Damages
pursuant to Sections 9.2(a)(i), 9.2(b)(i) and 9.2(b)(ii) (except for Damages
resulting from breaches of the representations and warranties made
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in Sections 3.1 and 4.5) until, and limited to the extent that, the aggregate
amount of Damages relating to such Claims for which Dynacs, each of its
Subsidiaries and FX and each of their respective Representatives, in the
aggregate, are entitled to indemnification under Sections 9.2(a)(i), 9.2(b)(i)
and 9.2(b)(ii) (except for Damages resulting from breaches of the
representations and warranties made in Sections 3.1 and 4.5) exceeds $100,000
(the "Dynacs Basket"). Dynacs, each of its Subsidiaries and FX and each of their
respective Representatives shall have the right to make a Claim hereunder prior
to the time at which the Dynacs Basket has been surpassed for the purpose of
asserting such Claim within the relevant survival period of the applicable
indemnification obligation, and any such Claim within such period shall, to the
extent the Dynacs Basket ultimately is met, survive until its final resolution.
(iii) The Members and each of their respective
Representatives and all Representatives of Cerulean may not recover, and neither
Dynacs nor FX shall be required to pay or otherwise be responsible for, any
Damages pursuant to Section 9.2(c)(i) (except for Damages resulting from
breaches of the representations and warranties made in Sections 5.8 and 5.9)
until, and limited to the extent that, the aggregate amount of Damages relating
to such Claims for which the Members and each of their respective
Representatives, in the aggregate, are entitled to indemnification under Section
9.2(c)(i) (except for Damages resulting from breaches of the representations and
warranties made in Sections 5.8 and 5.9) exceeds $50,000 (the "Member Basket").
The Members and each of their respective Representatives shall have the right to
make a Claim hereunder prior to the time at which the Member Basket has been
surpassed for the purpose of asserting such Claim within the relevant survival
period of the applicable indemnification obligation, and any such Claim within
such period shall, to the extent the Member Basket ultimately is met, survive
until its final resolution.
(iv) The liability of the Members, of Burns and of
Dynacs and FX under the indemnification provisions of Sections 9.2(a), (b) and
(c), respectively, shall be subject to reduction in an amount equal to the value
of any insurance benefit realized by the indemnified party in connection with
the loss or damage suffered by such party which forms the basis of the
indemnifying party's liability under this Agreement.
ARTICLE 10
MISCELLANEOUS
10.1 Certain Definitions. As used in this Agreement, the following
terms have the following meanings, unless the context otherwise requires:
"8(a) Program" means the Minority Small Business and Capital
Ownership Development Program established by Sections 8(a) and 7(j) of the Small
Business Act (15 U.S.C. 637(a) and 636(j), respectively), as amended, and the
regulations promulgated thereunder.
"Action" means any action, suit, claim, investigation or legal,
administrative, regulatory or arbitral proceeding or other litigation or inquiry
before or by any Governmental Body.
33
<PAGE> 39
"Affiliate" with respect to any Person, means and includes any other
Person controlling, controlled by or under common control with such Person.
"Business Day" means a day other than Saturday, Sunday or other day
on which commercial banks in Los Angeles, California, are authorized or required
by law to close.
"Cerulean Material Contracts" means any oral or written: (a)
employment, management, consulting and other contracts or agreements with any
current or former officer, director, employee or member or with any entity in
which any of the foregoing is an owner, officer, director, employee or member,
except for any agreements which are terminable at will, (b) contracts,
agreements, understandings or commitments for the purchase or sale of any
materials, products, services or supplies calling for a purchase price or
payment in any one year of an amount or value, individually or, for a series of
related contracts or other commitments, in the aggregate, of more than $20,000,
(c) leases, conditional sales contracts, licenses and other agreements under
which tangible personal property (including, without limitation, all computer
and peripheral and other related equipment and devices) is used in the business
to which Cerulean is a party and with respect to which there are remaining
payment obligations which exceed $5,000 in the aggregate, (d) contracts or
arrangements with customers or suppliers for the sharing of fees, the rebating
of charges or other similar arrangements, (e) contracts, commitments or options
relating to either (i) the acquisition by Cerulean of any operating business or
substantially all of the assets of a third party or (ii) the purchase or
disposition of any tangible or intangible assets of Cerulean other than in the
ordinary and usual course of business, (f) contracts containing covenants or
restrictions limiting in any way the freedom of Cerulean to compete in any line
of business or with any person or entity in any geographical area or for any
period of time, (g) contracts or arrangements requiring the payment to any
person of an override or similar commission or royalty or fee, (h) guarantees,
performance bid or completion bonds, or other contracts of surety ship or
indemnification other than in the ordinary course of business, (i) trade secret,
confidentiality or similar agreements, (j) joint venture, operating, shareholder
and partnership agreements, (k) loan agreements, (l) notes, (m) security
agreements, mortgages, debentures, indentures, factoring agreements or letters
of credit, (n) sales representative, distribution, franchise, advertising and
similar agreements, (o) license agreements, (p) contracts or arrangements
pursuant to which any customer has made a deposit of funds in excess of $5,000
against the purchase price of goods or services to be delivered or performed at
any time after the Closing Date, and (q) service agreements affecting the assets
used in the business of Cerulean where the service charge is in excess of $2,500
in the aggregate.
"Charter Documents" means (i) the Certificate or Articles of
Incorporation, Certificate or Articles of Formation or similar corporate or
limited liability company charter or other instrument of organization and (ii)
the Bylaws, operating agreement or similar instrument.
"Code" means the Internal Revenue Code of 1986, as amended, and the
regulations promulgated thereunder.
"Condition" means, with respect to any Person, the assets,
liabilities, properties, business, prospects, results of operations and
financial or other condition of such Person and its Subsidiaries, if any, taken
as a whole.
34
<PAGE> 40
"Contemplated Transactions" means the transactions to be consummated
pursuant to this Agreement or any other agreement to be delivered pursuant to
this Agreement.
"Contract" means and includes all contracts, agreements, indentures,
notes, bonds, loans, instruments, leases, conditional sales contracts,
mortgages, franchises, licenses, commitments or binding agreements or
arrangements, express or implied relating to personal or real property, tangible
or intangible.
"Damages" means all liabilities, demands, claims, actions or causes
of action, regulatory, legislative or judicial proceedings or investigations,
assessments, levies, losses, fines, penalties, damages, costs and expenses,
including without limitation reasonable attorneys', accountants', investigators'
and experts' fees and expenses, sustained or incurred in connection with the
defense or investigation of any claim.
"Documents" means and includes any document, agreement, instrument,
certificate, notice, consent, affidavit, letter telegram, telex, statement,
schedule (including any Schedule), exhibit (including any Exhibit) or any other
paper whatsoever.
"Dynacs Material Contracts" means any oral or written: (a)
employment, management, consulting and other contracts or agreements with any
current or former officer, director, employee or member or with any entity in
which any of the foregoing is an owner, officer, director, employee or member,
except for any agreements which are terminable at will, (b) contracts,
agreements, understandings or commitments for the purchase or sale of any
materials, products, services or supplies calling for a purchase price or
payment in any one year of an amount or value, individually or, for a series of
related contracts or other commitments, in the aggregate, of more than $200,000,
(c) leases, conditional sales contracts, licenses and other agreements under
which tangible personal property (including, without limitation, all computer
and peripheral and other related equipment and devices) is used in the business
to which Dynacs or any of its Subsidiaries is a party and with respect to which
there are remaining payment obligations which exceed $50,000 in the aggregate,
(d) contracts or arrangements with customers or suppliers for the sharing of
fees, the rebating of charges or other similar arrangements, (e) contracts,
commitments or options relating to either (i) the acquisition by Dynacs or any
of its Subsidiaries of any operating business or substantially all of the assets
of a third party or (ii) the purchase or disposition of any tangible or
intangible assets of Dynacs or any of its Subsidiaries other than in the
ordinary and usual course of business, (f) contracts containing covenants or
restrictions limiting in any way the freedom of Dynacs or any of its
Subsidiaries to compete in any line of business or with any person or entity in
any geographical area or for any period of time, (g) contracts or arrangements
requiring the payment to any person of an override or similar commission or
royalty or fee, (h) guarantees, performance bid or completion bonds, or other
contracts of surety ship or indemnification other than in the ordinary course of
business, (i) trade secret, confidentiality or similar agreements, (j) joint
venture, operating, shareholder and partnership agreements, (k) loan agreements,
(l) notes, (m) security agreements, mortgages, debentures, indentures, factoring
agreements or letters of credit, (n) sales representative, distribution,
franchise, advertising and similar agreements, (o) license agreements, (p)
contracts or arrangements pursuant to which any customer has made a deposit of
funds in excess of $50,000 against the purchase price of goods or services to be
delivered or performed at any time after the
35
<PAGE> 41
Closing Date, and (q) service agreements affecting the assets used in the
business of Dynacs or any of its Subsidiaries where the service charge is in
excess of $25,000 in the aggregate.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended.
"ERISA Affiliate" means, with respect to any Person, an affiliate of
such Person as determined under Section 414(b), (c), (m) or (o) of the Code.
"Exhibit" means any exhibit hereto.
"GAAP" means generally accepted accounting principles, consistently
applied.
"Governmental Body" means any government or any political
subdivision thereof, whether federal, state, local or foreign, or any agency,
authority or instrumentality of any government or any political subdivision
thereof, or any federal or state court or arbitrator.
"Hazardous Substance" means those substances defined as hazardous
substances in 42 U.S.C. ss.9601(14) and all other substances defined as
hazardous under other applicable Laws.
"Indebtedness" means, with respect to any Person, (i) any liability,
contingent or otherwise, (a) for borrowed money, capitalized lease obligations,
purchase money obligations or other obligations relating to the deferred
purchase price of assets or property or (b) evidenced by a note, bond,
debenture, letter of credit or similar instrument given in connection with the
acquisition, other than in the ordinary course of business, of any property,
assets, securities or otherwise, including indebtedness created or arising under
conditional sale or other title retention agreements (even though the rights and
remedies of the seller or lender under the agreements in the event of default
are limited to repossession or sale of the property), (ii) any liability of
others described in the preceding clause which such Person has guaranteed or
which otherwise is its legal liability, (iii) any capitalized lease obligations,
(iv) all indebtedness referred to above secured by (or for which the holder of
the indebtedness has an existing right, contingent or otherwise, to be secured
by, any Lien upon the property of such Person, whether or not the obligations
secured thereby have been assumed, and (v) any amendment, renewal, extension or
refunding of any liability referred to in clauses (i), (ii), (iii) and (iv)
above; provided, however, that Indebtedness does not include any trade payables
of any Person incurred in the ordinary course of business. The amount of
Indebtedness of any Person at any date shall be the outstanding balance at the
date of all unconditional obligations as described above and the maximum amount
of any contingent obligations at the date.
"Knowledge" means, with respect to any Person, the knowledge of any
of its officers, directors, shareholders, managers or members after reasonable
inquiry; and "knows" has a correlative meaning.
"Law" means any law, statute, code, ordinance, regulation, rule or
other requirement of any Governmental Body.
"Lien" means and includes any lien, pledge, mortgage, security
interest, claim, lease, charge, option, right of first refusal, unsatisfied
preemptive right, easement, transfer.
36
<PAGE> 42
restriction under any shareholder or similar agreement, or any other
encumbrance, restriction or limitation whatsoever.
"Membership Interests" means an ownership interest in Cerulean,
which includes a Member's share of the profits and losses of Cerulean, a
Member's right to receive distributions of Cerulean's assets, a Member's right
to vote or participate in the management of Cerulean as permitted under
Cerulean's operating agreement, and a Member's right to information concerning
the business and affairs of Cerulean, as provided in Cerulean's operating
agreement and under the provisions of the Delaware Limited Liability Company
Act.
"Order" means any order, judgment, injunction, award, decree, writ,
or similar action of any Governmental Body.
"Percentage Interests" means the percentage assigned to each Member
as set forth in Cerulean's operating agreement, as amended.
"Permit" means any license, authorization, permit, order or approval
of, and any required registration with, any Governmental Body.
"Person" means any individual, corporation, partnership, firm, joint
venture, association, joint-stock company, trust, incorporated organization or
other entity.
"Property" means real, personal or mixed property.
"Qualified Public Offering" means the closing of (i) an underwritten
public offering of Dynacs Common Stock pursuant to an effective registration
statement filed with the Securities and Exchange Commission under the Securities
Act, or (ii) the merger of Dynacs with and into another entity pursuant to which
the shareholders of Dynacs immediately prior to the effective date of the merger
receive, upon consummation of the merger, shares of voting securities of the
surviving entity or its parent that are registered under the Securities Exchange
Act of 1934, as amended, and trade on the New York Stock Exchange, the American
Stock Exchange, the Nasdaq National Market or the Nasdaq SmallCap Market.
"Representative" of any Person means any officer, director, member,
principal, attorney, agent, employee or other representative of such Person.
"Safety and Environmental Laws" means (i) the Occupational Safety
and Health Act of 1970 and (ii) any Laws relating to pollution or protection of
the environment, including, without limitation, emissions, discharges, releases
or threatened releases of pollutants, contaminants, chemicals, or industrial,
toxic or hazardous substances or waste into the environment (including, without
limitation, ambient air, surface water ground water or land), or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of pollutants, contaminants, chemicals or
industrial, toxic or hazardous substances or wastes, including, without
limitation, Laws under the Comprehensive Environmental Compensation and
Liability Act, 42 U.S.C. ss.9601 et seq., the Resource Conservation and Recovery
Act, 42 U.S.C. ss.901 seq., the Toxic Substance Control Act, 15 U.S.C. ss.2601
et seq., the Safe Drinking Water Act, the Clean
37
<PAGE> 43
Water Act, 33 U.S.C. ss.251 et seq., the Clean Air Act, the Hazardous Materials
Transportation Act, or any other similar statute or equivalent state statutes.
"SBA" means the U.S. Small Business Administration.
"Schedule" means any schedule hereto.
"Subsidiary' or "Subsidiaries" means, with respect to any Person,
any corporation or other business entity of which an aggregate of 50% or more of
the outstanding stock or other equity or ownership interest is, at the time,
directly or indirectly owned by the Person and/or one or more subsidiaries of
the Person.
"Tax" or "Taxes" mean all taxes, charges, fees, imposts, levies or
other assessments, including, without limitation, all net income, gross
receipts, sales, use, ad valorem, value added, transfer, franchise, profits,
inventory, capital stock, license, withholding, payroll, employment, social
security, unemployment, excise, severance, stamp, occupation, and property
taxes, customs duties, fees, assessments and charges of any kind whatsoever,
together with any interest and any penalties, additions to tax or additional
amounts imposed by any taxing authority (domestic or foreign) and shall include
any transferee liability in respect of Taxes.
"Tax Return" or "Tax Returns" mean all returns, declarations,
reports, estimates, information returns and statements required to be filed in
respect of any Taxes.
10.2 Business Day. If the last day any action is required or
permitted to be performed under this Agreement is not a Business Day, the action
may be performed on the Business Day next succeeding the last day the action is
required or permitted to be performed.
10.3 Notices. Any notice or other communication required or
permitted hereunder shall be in writing and shall be delivered personally,
telexed, sent by facsimile transmission, Express Mail, Federal Express or other
similar overnight courier or sent by certified, registered mail, postage
prepaid, and shall be deemed given when so delivered personally, telexed or sent
by facsimile transmission, or if mailed, two days after the date of mailing at
the addresses specified below:
(a) if to FX, Dynacs or Cerulean, to:
Dynacs Engineering Company, Inc.
35111 U.S. Highway 19 North, Suite 300
Palm Harbor, Florida 34684
Attention: Dr. Ramendra P. Singh, President
Tel: (813) 787-1245
Fax: (813) 787-2503
38
<PAGE> 44
with a copy to:
Frankfurt, Garbus Klein & Selz
488 Madison Avenue, 9th Floor
New York, NY 10022
Attention: Gary A. Schonwald, Esq.
Tel: (212) 980-0120
Fax: (212) 593-9175
and
(b) if to the Members, to:
c/o Michael Burns, Member Representative
Prudential Securities
2049 Century Park East, Suite 1200
Los Angeles, California 90067
Tel: (310) 996-2929
Fax: (310) 458-7595
with a copy to:
Troop Steuber Pasich Reddick & Tobey, LLP
2029 Century Park East
Twenty-Fourth Floor
Los Angeles, CA 90067
Attention: Richard E. Troop, Esq.
Tel: (310) 728-3000
Fax: (310) 728-2200
Any party may by notice given in accordance with this Section to the other
parties designate another address or person for receipt of notices hereunder.
10.4 Entire Agreement. This Agreement (including the Exhibits and
Schedules) and any collateral Agreements executed in connection with the
consummation of the Contemplated Transactions contain the entire agreement among
the parties with respect to the Contemplated Transactions and supersedes all
prior Agreements, proposals or representations, arrangements or understandings,
written or oral, with respect to the Contemplated Transactions.
10.5 Waivers and Amendments; Remedies. This Agreement may be
amended, modified, superseded, canceled, renewed or extended, and the terms and
conditions of this Agreement may be waived, only by a written instrument signed
by all the parties hereto or, in the case of a waiver, by the party or parties,
as the case may be, waiving compliance. No delay on the part of any party in
exercising any right, power or privilege under this Agreement shall operate as a
waiver of any right, power or privilege under this Agreement, nor shall any
waiver on the part of any party of any right, power or privilege under this
Agreement, nor any single or partial exercise of any right, power
39
<PAGE> 45
or privilege under this Agreement, shall preclude any other or further exercise
of any right, power or privilege under this Agreement or the exercise of any
other right, power or privilege under this Agreement. The rights and remedies
provided for in this Agreement are cumulative and are not exclusive of any
rights or remedies which any party may otherwise have at law or in equity. The
rights and remedies of any party or parties, as the case may be, based upon,
arising out of or otherwise in respect of any inaccuracy in or breach of any
representation, warranty, covenant or agreement contained in this Agreement or
any Documents delivered pursuant to this Agreement shall in no way be limited by
the fact that the act, omission, occurrence or stated facts upon which any claim
of any inaccuracy or breach is based may also be the subject matter of any other
representation, warranty, covenant, or agreement contained in this Agreement or
any Documents delivered pursuant to this Agreement (or in any other agreement
between the parties) as to which there is no inaccuracy or breach.
10.6 Governing Law. This Agreement shall be governed and construed
in accordance with the laws of the State of California applicable to Agreements
made and to be performed entirely within the State of California, without regard
to principles of conflicts of law.
10.7 Binding Effect; No Assignment. This Agreement shall be binding
upon and inure to the benefit of the parties and its successors and legal
representatives. This Agreement is not assignable except by operation of law.
10.8 Variations in Pronouns. All pronouns and any variations thereof
refer to the masculine, feminine or neuter, singular or plural, as the context
may require.
10.9 Counterparts. This Agreement maybe executed in two or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument. The parties may transmit
by facsimile executed copies of the signature pages to this Agreement to all
other parties. Each party transmitting a signature page by facsimile shall
promptly forward signed original counterparts to the other parties to this
Agreement.
10.10 Exhibits and Schedules. The Exhibits and Schedules referred to
in this Agreement are a part of this Agreement as if set forth in full in this
Agreement. All references to this Agreement shall be deemed to include the
Exhibits and Schedules hereto, unless the context otherwise requires. Any
capitalized terms used in any Exhibit or Schedule, but not otherwise defined
therein, shall have the meaning as defined in this Agreement.
10.11 Headings. The headings in this Agreement are for reference
purposes only and shall not in any way affect the meaning or interpretation of
this Agreement.
10.12 Severability. If any provision or any portion of any provision
of this Agreement, or the application of any provision or any portion of any
provision to any Person or circumstance, shall be held invalid or unenforceable,
the remaining portion of the provision and the remaining provisions of this
Agreement, and the application of the provision or portion of the provision as
is held invalid or unenforceable to Persons or circumstances other than those as
to which it is held invalid or unenforceable, shall not be affected thereby.
40
<PAGE> 46
10.13 Costs and Attorneys' Fees. In the event that any action, suit
or other proceeding is instituted concerning or arising out of this Agreement,
the prevailing party shall be entitled to recover all of the prevailing party's
costs and reasonable attorneys' fees incurred in each and every such action,
suit, or other proceedings, including any and all appeals or petitions
therefrom.
10.14 No Adverse Construction. The rule that a contract is to be
construed against the party drafting the contract is hereby waived, and shall
have no applicability in construing this Agreement or the terms of this
Agreement.
[SIGNATURES FOLLOWING PAGE]
41
<PAGE> 47
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
CERULEAN FXS, INC.,
a Florida Corporation
By: /s/ R P Singh
------------------------------------
Name:
Its: ____________________________________
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By: /s/ R P Singh
------------------------------------
Dr. Ramendra P. Singh
Its: President
MEMBERS
_________________________________________
Michael Burns
_________________________________________
William Dallas
_________________________________________
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By: _______________________________
Its: _______________________________
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
42
<PAGE> 48
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
CERULEAN FXS, INC.,
a Florida Corporation
By: ____________________________________
Name:
Its: ____________________________________
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By: ____________________________________
Dr. Ramendra P. Singh
Its: President
MEMBERS
/s/ Michael Burns
-----------------------------------------
Michael Burns
_________________________________________
William Dallas
_________________________________________
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By: _______________________________
Its: _______________________________
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
42
<PAGE> 49
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
CERULEAN FXS, INC.,
a Florida Corporation
By: ____________________________________
Name:
Its: ____________________________________
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By: ____________________________________
Dr. Ramendra P. Singh
Its: President
MEMBERS
_________________________________________
Michael Burns
/s/ William Dallas
-----------------------------------------
William Dallas
_________________________________________
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By: _______________________________
Its: _______________________________
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
42
<PAGE> 50
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
CERULEAN FXS, INC.,
a Florida Corporation
By: ____________________________________
Name:
Its: ____________________________________
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By: ____________________________________
Dr. Ramendra P. Singh
Its: President
MEMBERS
_________________________________________
Michael Burns
_________________________________________
William Dallas
/s/ Jon Feltheimer
-----------------------------------------
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By: _______________________________
Its: _______________________________
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
42
<PAGE> 51
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
CERULEAN FXS, INC.,
a Florida Corporation
By: ____________________________________
Name:
Its: ____________________________________
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By: ____________________________________
Dr. Ramendra P. Singh
Its: President
MEMBERS
_________________________________________
Michael Burns
_________________________________________
William Dallas
_________________________________________
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By: /s/
-------------------------------
Its: _______________________________
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
42
<PAGE> 52
[SIGNATURES CONTINUED]
CERULEAN COLORIZATION, L.L.C..
a Delaware Limited Liability Company
By: /s/ Michael Burns
------------------------------------
Michael Bums
Its: Manager
43
<PAGE> 53
CONSENT OF SPOUSE
The undersigned is the spouse of Jon Feltheimer and hereby acknowledges
that she has read the Contribution and Exchange Agreement, dated as of August
12, 1999, among Dynacs Engineering Company, Inc., Cerulean FXs, Inc., ("FX"),
Cerulean Colorization, L.L.C. ("Cerulean") and those persons whose names appear
on Exhibit A attached thereto (the "Agreement"), and knows its contents. The
undersigned is aware that by the terms of the Agreement, Jon Feltheimer agrees
to sell all of his Membership Interests in Cerulean to FX, including the
undersigned's martial property interest therein, if any, on the Closing Date.
The undersigned hereby consents to the sale, approves the provisions of the
Agreement and agrees that the Membership Interests and her interest therein, if
any, are subject to the provisions of the Agreement and that she will take no
action at any time to hinder the operation of the Agreement with respect to the
Membership Interests or her interest, if any, in the Membership Interests.
All capitalized terms used in this Consent and not defined in this Consent
shall have the respective meanings given those terms in the Agreement.
/s/ Laurie Demarest
-------------------------------
Name:
<PAGE> 54
CONSENT OF SPOUSE
The undersigned is the spouse of William Dallas and hereby acknowledges
that she has read the Contribution and Exchange Agreement, dated as of August
12, 1999, among Dynacs Engineering Company, Inc., Cerulean FXs, Inc., ("FX"),
Cerulean Colorization, L.L.C. ("Cerulean") and those persons whose names appear
on Exhibit A attached thereto (the "Agreement"), and knows its contents. The
undersigned is aware that by the terms of the Agreement, William Dallas agrees
to sell all of his Membership Interests in Cerulean to FX, including the
undersigned's martial property interest therein, if any, on the Closing Date.
The undersigned hereby consents to the sale, approves the provisions of the
Agreement and agrees that the Membership Interests and her interest therein, if
any, are subject to the provisions of the Agreement and that she will take no
action at any time to hinder the operation of the Agreement with respect to the
Membership Interests or her interest, if any, in the Membership Interests.
All capitalized terms used in this Consent and not defined in this Consent
shall have the respective meanings given those terms in the Agreement.
/s/ Beverly J. Dallas
-------------------------------
Name:
<PAGE> 55
EXHIBIT A
to
CONTRIBUTION AND EXCHANGE AGREEMENT
Dated as of August 12, 1999
MEMBERS AND MEMBERSHIP INTERESTS;
FX SHARES
---------------------------------------------------------------------
Percentage FX
Member Interest Shares
---------------------------------------------------------------------
Michael Bums 61.905% 12,381
---------------------------------------------------------------------
William Dallas 15.238% 3,048
---------------------------------------------------------------------
Jon Feltheimer 15.238% 3,048
---------------------------------------------------------------------
Offense Group 7.619% 1,523
Associates, LP
---------------------------------------------------------------------
Total 100% 20,000
---------------------------------------------------------------------
<PAGE> 56
EXHIBIT B
to
CONTRIBUTION AND EXCHANGE AGREEMENT
Dated as of August 12, 1999
FORM OF SHAREHOLDERS AGREEMENT
<PAGE> 57
================================================================================
SHAREHOLDERS AGREEMENT
Dated as of , 1999
By and Among
DYNACS ENGINEERING COMPANY, INC.
("COMPANY"),
RAMENDRA P. SINGH
PETER LIKINS
ROBERT SKELTON
JAVIER E. BENAVENTE
JAYANT RAMAKRISHNAN
HARRY W. SCHUBELE
RAVI VENUGOPAL
RAMESH VENUGOPAL
("EXISTING SHAREHOLDERS"),
And
MICHAEL BURNS
WILLIAM DALLAS
JON FELTHEIMER
OFFENSE GROUP ASSOCIATES, LP
("INVESTORS")
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TABLE OF CONTENTS
PAGE
1. Definitions .............................................................2
2. Restrictions on Transfer ................................................4
(a) General Restrictions ..............................................4
(b) Closing of Permitted Transfers ....................................4
3. Permitted Transfers of Shares ...........................................5
(a) Shareholder Transfers .............................................5
(b) Transfers to Family Members, Trusts
or Other Legal Entities ...........................................5
(c) Qualified Transferees .............................................5
4. Right of First Refusal ..................................................6
(a) Transfer Notice ...................................................6
(b) Acceptance ........................................................7
(c) Allocation of Offered Shares ......................................7
(d) Transfer to Subscribing Shareholders ..............................7
(e) Transfer to Transferee ............................................7
5. CoSale Right in Sale of Voting Control ..................................8
(a) Rights of CoSale ..................................................8
(b) Exercise of CoSale Right ..........................................8
6. Other Transfers of Shares . .............................................9
(a) Involuntary Transfers .............................................9
(b) Purchase Rights .... .............................................10
(c) Purchase Procedures ..............................................10
(c) Determination of Fair Market Value of
Shares Procedures ................................................10
7. Restrictive Endorsement on Share Certificates ..........................11
8. Agreements of Certain Spouses ..........................................11
9. Termination of Existing Agreements... ..................................11
10. Board of Directors .....................................................11
11. Miscellaneous ..........................................................12
(a) Notices ..........................................................12
(b) Amendment ........................................................12
(c) Termination ......................................................12
(d) Waiver ...........................................................12
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(e) Equitable Relief .................................................13
(f) Counterparts .....................................................13
(g) Construction .....................................................13
(h) Governing Law ....................................................13
(i) Benefit and Binding Effect .......................................13
(j) Future Spousal Consents ..........................................13
(k) Further Assurances ...............................................13
Exhibits:
Exhibit A -- Existing Shareholders and Outstanding Shares
Exhibit B -- Investors
Exhibit C -- Spousal Consent
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SHAREHOLDERS AGREEMENT
THIS SHAREHOLDERS AGREEMENT (this "Agreement"), is made and entered into
as of __________, 1999, by and among DYNACS ENGINEERING COMPANY, INC., a Florida
corporation (the "Company'), the shareholders of the Company whose names appear
on Exhibit A to this Agreement (collectively referred to in this Agreement as
the "Existing Shareholders" and each as an "Existing Shareholder"), and those
persons whose names appear on Exhibit B to this Agreement (collectively referred
to in this Agreement as the "Investors" and each as an "Investor"). The Existing
Shareholders and the Investors are collectively referred to in this Agreement,
together with all other persons who may hereafter become parties to this
Agreement, as the "Shareholders".
RECITALS
A. As of the date of this Agreement, the Existing Shareholders own of
record and beneficially the number of shares of common stock, par value $.001
per share, of the Company (the "Common Stock") set forth opposite their
respective names on Exhibit A, constituting 100% of the outstanding equity
securities of the Company.
B. Upon consummation of the transactions contemplated by that certain
Contribution and Exchange Agreement, dated as of August 12, 1999, by and among
the Company, Cerulean FXs, Inc., a Florida corporation ("FX"), Cerulean
Colorization, L.L.C., a Delaware limited liability company ("Cerulean"), and the
Investors (the "Contribution Agreement"), Cerulean will become a wholly-owned
subsidiary of FX, the Company will acquire 80,000 shares of common stock, par
value $0.01 per share, of FX (the "FX Common Stock"), and the Investors will
acquire an aggregate of 20,000 shares of FX Common Stock.
C. Concurrently with or prior to the execution of this Agreement, the
Company, Ramendra P. Singh and the Investors have executed that certain Exchange
Agreement (the "Exchange Agreement") which provides, among other things, for the
issuance to the Investors of shares of Common Stock in exchange for the shares
of FX Common Stock held by the Investors upon the occurrence of certain events.
D. It is a condition to the consummation of the transactions contemplated
by the Contribution Agreement that this Agreement be entered into by the
Company, the Existing Shareholders and the Investors.
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AGREEMENT
NOW, THEREFORE, in consideration of the foregoing premises and of the
mutual covenants and agreements contained in this Agreement, on the terms and
subject to the conditions set forth in this Agreement, the parties to this
Agreement agree as follows:
1. Definitions. Capitalized terms used in this Agreement and not defined
in this Agreement shall have the meanings given those terms in the Contribution
Agreement. Otherwise, the following terms have the following meanings, unless
the context otherwise requires:
"1998 Shareholders' Agreement" means that certain Shareholders'
Agreement, dated October 21, 1998, among the Company, Ramendra P. Singh, Robert
E. Skelton, Peter Likins, Javier E. Benavente, Jayant Ramakrishnan, Harry W.
Schubele III and Ravi Venugopal.
"Affiliate" means, with respect to a specified Person, any Person
that directly or indirectly through one or more intermediaries controls or is
controlled by, or is under common control with, the specified Person.
"business day" means a day other than Saturday, Sunday or other day
on which commercial banks in New York, New York, are authorized or required by
law to close.
"Buy-Sell Agreement" means that certain Buy-Sell Agreement, dated
March, 1996, among the Company Ramendra P Singh, Robert E. Skelton and Peter
Likins.
"CoSale Period" and "CoSale Right" have the respective meanings set
forth in Section 6 of this Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Shares" means the shares of Common Stock that may be
issued by the Company to the Investors pursuant to the terms of the Exchange
Agreement.
"Fair Market Value" means (i) with respect to the Shares, the price
determined pursuant to Section 6(d) of this Agreement; and (ii) with respect to
any property other than the Shares with respect to which the fair market value
is to be determined, the price of the property that a willing buyer would pay in
an all-cash transaction with an equally willing seller. In the event of a
disagreement regarding the Fair Market Value of property other than the Shares,
the resolution procedures of Section 6(d) shall apply.
"Family Member" means, with respect to any Person, any descendant of
the grandfather of the Person, the Person's spouse or any descendant of the
grandfather of the Person's spouse.
"FGCA" means the Florida General Corporation Act.
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"Involuntary Transfer" and "Involuntary Transfer Event" shall have
the respective meanings set forth in Section 6 of this Agreement.
"Member Representative" shall have the meaning given such term in
Section 2.2 of the Contribution Agreement.
"Offered Price", "Offered Shares", "Offered Terms and Conditions"
and "Other Shareholders" have the respective meanings set forth in Section 4 of
this Agreement.
"Person" means any individual, corporation, partnership, firm, joint
venture, association, joint-stock company trust, incorporated organization or
other entity.
"Pro rata" means, with respect to any determination, that the
determination is based on the relative percentages of Shares then held by all of
the Shareholders after giving pro forma effect to the issuance by the Company
and the ownership by the Investors, of all of the Exchange Shares at the time
the determination is made, as if all of the Exchange Shares had been then
issued.
"Proposed Transferee" has the meaning set forth in Section 3(c) of
this Agreement.
"Qualified Public Offering" means the closing of (i) an underwritten
public offering of the Common Stock pursuant to an effective registration
statement filed with the Securities and Exchange Commission under the Securities
Act, or (ii) a merger of the Company with and into another entity pursuant to
which the shareholders of the Company immediately prior to the effective date of
the merger receive, upon consummation of the merger, shares of voting securities
of the surviving entity or its parent that are registered under Section 12 of
the Exchange Act and trade on the New York Stock Exchange, the American Stock
Exchange, the Nasdaq National Market or the Nasdaq SmallCap Market.
"Sale of Voting Control" means any transfer, or series of related
transfers, of Shares to any Person who, in the aggregate with all Family Members
and Affiliates of such Person, and any other Persons who are part of a syndicate
or group (as defined in Section 13(d)(3) of the Exchange Act) with such Person,
would (after giving effect to the transfer but disregarding any Shares held by
the Person, his or her Family Members and Affiliates, and syndicate or group
prior to the transfer) own Shares constituting more than 50% of the voting power
of the then issued and outstanding Shares (after giving pro forma effect to the
issuance by the Company, and the ownership by the Investors, of all of the
Exchange Shares at the time the determination is made, as if all of the Exchange
Shares had been then issued).
"Securities Act" means the Securities Act of 1933, as amended.
"Shares" means any shares of Common Sock subject to this Agreement.
"Stock Subscription Agreements" means, collectively, (i) that
certain Stock Subscription Agreement, dated February 3, 1996, between the
Company and Ravi Venugopal, (ii) that certain Stock Subscription Agreement,
dated February 3, 1996, between the
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Company and Jayant Ramakrishnan, (iii) that certain Stock Subscription
Agreement, dated February 3, 1996, between the Company and Harry W. Schubele,
and (iv) that certain Stock Subscription Agreement, dated February 3, 1996,
between the Company and Javier Benavente.
"transfer" means any sale, assignment, transfer, pledge,
hypothecation, gift, encumbrance or other disposition of Shares.
"Transferee", "Transferor" and "Transfer Notice" have the respective
meanings set forth in Section 4 of this Agreement.
2. Restrictions on Transfer.
(a) General Restrictions. During the term of this Agreement, none of
the Shares now owned or acquired after the date of this Agreement by any of the
Shareholders may be transferred unless and until:
(i) the transfer of Shares shall be made in accordance with
the provisions of this Agreement;
(ii) the proposed recipient of the Shares shall have delivered
to the Company a signed counterpart of this Agreement or a written
acknowledgment for the benefit of the parties to this Agreement, that the Shares
to be received in the proposed transfer are subject to this Agreement and that
the proposed recipient and his successors in interest are and will be bound by
this Agreement and agree to comply with the provisions of this Agreement
relating to the transferred Shares; and
(iii) the transfer shall have been made pursuant to an
effective registration under the Securities Act and any applicable state
securities laws, or an exemption from registration, and prior to any transfer
the Shareholder proposing to transfer Shares shall have delivered to the Company
(A) notice describing the manner and circumstances of the proposed transfer
(copies of which the Company shall furnish to each Shareholder following receipt
of the notice by the Company) and (B) if requested by the Company, a written
opinion of legal counsel, which shall be reasonably satisfactory to the Company
and its counsel, to the effect that the proposed transfer of Shares may be
effected without registration under the Securities Act and any applicable state
securities laws.
ANY ATTEMPTED TRANSFER OF SHARES OTHER THAN IN ACCORDANCE WITH THIS AGREEMENT
SHALL BE NULL AND VOID AND THE COMPANY MAY REFUSE TO (i) RECOGNIZE THE TRANSFER
AND NOT REFLECT IN ITS RECORDS ANY CHANGE IN RECORD OWNERSHIP OF SHARES PURSUANT
TO THE TRANSFER AND (ii) TREAT AS OWNER OF THE SHARES OR TO ACCORD THE RIGHT TO
VOTE AS THE OWNER OF THE SHARES OR TO PAY DIVIDENDS TO ANY TRANSFEREE TO WHOM
THE SHARES SHALL HAVE BEEN TRANSFERRED.
(b) Closing of Permitted Transfers. The closing of any transfer of
Shares permitted pursuant to this Agreement shall take place at the principal
executive offices of the Company unless otherwise agreed by the parties involved
in the transfer. Any Shareholder which
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transfers Shares shall (i) do all things and execute and deliver all papers as
may be necessary or reasonably requested by the Company in order to consummate
the transfer of the Shares, (ii) pay all amounts as may be required for any
applicable stock transfer taxes, and (iii) pay to the Company any expenses
reasonably incurred by the Company in connection with the transfer (including
reasonable attorneys' fees).
3. Permitted Transfers of Shares. Subject to Section 2 of this Agreement,
any Shareholder may transfer Shares in accordance with the terms and conditions
of this Section 3.
(a) Shareholder Transfers. Any Shareholder may transfer any or all
of his Shares as follows:
(i) to any third party, provided, that (A) the transferee
satisfies the requirements of Section 3(c) of this Agreement, (B) the Shares are
first offered for sale to the Company and all other Shareholders in accordance
with the procedures in Section 4 of this Agreement, and (C) if the transfer
involves a Sale of Voting Control, it shall be made subject to the provisions of
Section 5 of this Agreement; except that the foregoing provisos shall not apply
to a transfer to the Family Members of a Shareholder or a trust, investment fund
or other legal entity pursuant to Section 3(b); or
(ii) to the Company.
(b) Transfers to Family Members, Trusts or Other Legal Entities. Any
Shareholder may transfer all or a portion of their respective Shares, by death
or inter vivos, (i) to any of the Shareholder's Family Members, (ii) to any
trust established solely for the benefit of the Shareholder or one or more of
the Shareholder's Family Members, or to any legal entity in which the
Shareholder or any of these Persons are the sole beneficial owners, or (iii) if
the Shareholder is an investment fund, to any other investment fund in which the
general partner or investment advisor of the Shareholder is the general partner
or investment advisor of the other investment fund. Any Shares transferred to
the executor of an estate, in the case of death, to any Family Member, or to any
trust, investment fund or other legal entity described above in subsection
(ii) or (iii) of this paragraph, shall be subject to the provisions of this
Agreement. No transfer of Shares may be made to any of the foregoing Persons
unless and until the Person delivers to the Company a signed counterpart of this
Agreement or a written acknowledgment that the Shares to be received in the
proposed transfer are subject to this Agreement and that the Person and his
successors in interest are bound by this Agreement and agree to comply with its
terms. Any attempted transfer of Shares to any of the foregoing Persons other
than in accordance with this Section 3(b) shall be null and void and the Company
will refuse to recognize the transfer and not reflect in its records any change
in record ownership of Shares pursuant to the transfer, and the Company will
refuse to treat as owner of the Shares or to accord the right to vote as the
owner or to pay dividends to any transferee to whom the shares shall have been
transferred.
(c) Qualified Transferees. Except as provided in Section 3(a)(ii)
and/or Section 3(b), no Shareholder shall transfer any Shares pursuant to the
provisions of this Agreement unless the person or group of related persons who
collectively are the proposed transferee (the "Proposed
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Transferee") meets each of the following criteria and delivers a certificate
executed by the Proposed Transferee and addressed to the Company and each of the
Shareholders certifying that:
(i) the Proposed Transferee is not acting in concert with or
on behalf of the transferor or any affiliate of the transferor with the purpose
of evading, avoiding or impairing any of the Shareholders' rights of first
refusal under Section 4 of this Agreement, co-sale rights under Section 5 of
this Agreement or purchase rights under Section 6 of this Agreement.
(ii) the Proposed Transferee is acquiring the Shares for his
own account and not as an agent, bailee or nominee or on behalf of any person or
with a view toward resale of the Shares;
(iii) the Proposed Transferee is not engaged in a business
substantially similar to or which is otherwise in competition with the
then-existing businesses of the Company, nor serving as an employee, officer,
director or stockholder, directly or indirectly and whether as principal, agent
or employee or otherwise, of any entity engaged in such business, or acting
alone or in association with any individual or any other entity carrying on,
engaging in, employed by or taking part in, consulting or advising or owning,
sharing in the earnings of, or financing, whether as lender, investor or
otherwise, any entity engaged in such business; provided, that it shall be
permissible for the Proposed Transferee to invest in stock, bonds or other
securities of an entity competing with the Company if (A) the stock, bonds or
other securities are listed on any national securities exchange or have been
registered under Section 12(g) of the Exchange Act, and (B) the investment does
not equal or exceed, in the case of any class of capital stock of any one
issuer, 1% of the issued and outstanding shares of the capital stock, or, in the
case of bonds or other securities, 1% of the aggregate principal amount thereof
issued and outstanding; and
(iv) the Proposed Transferee has reviewed the Transfer Notice
delivered to the Shareholders pursuant to Section 4(a) of this Agreement and
represents that (A) the Transaction Notice is true and correct, (B) the offer
referred to in the Transaction Notice constitutes a bona-fide offer to purchase
the referenced shares, (C) the Proposed Transferee is ready, willing and able to
consummate the transaction described in the Transaction Notice; and (D) the
Transfer Notice contains a true and complete description of the material terms
of all material contracts, agreements, understandings and other arrangements,
oral or written, relating to the purchase of securities.
4. Right of First Refusal. Other than (i) a transfer under Section
3(a)(ii) to the Company, or (ii) a transfer under Section 3(b) to the Family
Members of a Shareholder or a trust, investment fund or other legal entity
described in Section 3(b), Shares may be sold to any person or group of related
persons (collectively, the "Transferee") only after compliance with the
provisions of this Section 4 and in accordance with the other provisions of this
Agreement.
(a) Transfer Notice. Any Shareholder proposing to make a transfer of
Shares (the "Transferor") shall deliver a written notice of the proposed
transfer (the "Transfer Notice") to the Company and to each of the other
Shareholders entitled to receive an offer to purchase under the provisions of
this Agreement (the "Other Shareholders"). The Transfer Notice shall contain a
description of the proposed transaction and the terms of the proposed
transaction, including (i) the number of Shares to be transferred (the "Offered
Shares"), (ii) the name of the Transferee, including,
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specifically the name of each person to whom or in favor of whom the proposed
transfer is to be made, (iii) the per share price at which the Offered Shares
are proposed to be sold to the Transferee (the "Offered Price"), (iv) the terms
of payment of the Offered Price and the other terms and conditions to the
proposed sale to the Transferee (the "Offered Terms and Conditions"), and (iv)
an offer to the Company and the Other Shareholders to sell to them the Offered
Shares on the same terms and conditions as contained in the Transfer Notice.
Notwithstanding the foregoing, if the proposed sale of the Offered Shares to the
Transferee provides for consideration other than solely cash and/or promissory
notes, the Company and the Other Shareholders shall have the right to purchase
the Shares for, in lieu of the consideration, cash in an amount equal to the
Fair Market Value of the consideration and in such case, the Transfer Notice
shall state the Transferor's estimate of the Fair Market Value of the
consideration, which shall be binding upon the Transferee (but not the Company
or the Other Shareholders).
(b) Acceptance. The offer may be accepted only by giving written
notice of acceptance to the Transferor within 30 days of receipt of the Transfer
Notice. Each of the Other Shareholders who accept the offer (the "Subscribing
Shareholders") shall also deliver a copy of their notice of acceptance to the
Company. A Subscribing Shareholder may subscribe in its acceptance for any
portion or all of the Offered Shares.
(c) Allocation of Offered Shares. The number of Offered Shares
purchased by the Company and each Subscribing Shareholder shall be determined as
follows:
(i) the Company shall have the right to purchase all or any
portion of the Offered Shares;
(ii) each Other Shareholder shall have the right to purchase
his pro rata share of an amount of Shares equal to the Offered Shares minus the
number of Shares purchased by the Company;
(iii) if any Offered Shares remain unallocated and all
subscriptions from Subscribing Shareholders have not been filled, the balance of
the unallocated Offered Shares shall be iteratively offered and allocated pro
rata by the Company among the Subscribing Shareholders whose subscriptions have
not been filled until either all the Offered Shares have been allocated or all
subscriptions have been filled.
(d) Transfer to Subscribing Shareholders. If the Offered Shares have
been fully subscribed for, the Company shall give written notice to that effect
to the Transferor and all Subscribing Shareholders, stating the number of
Offered Shares allocated to the Company and each Subscribing Shareholder, and
the transfer of the Offered Shares shall thereafter be effected between the
Transferor, the Company and the Subscribing Shareholders upon all of the
applicable terms and conditions set forth in the Transfer Notice.
(e) Transfer to Transferee. If the Company and the Subscribing
Shareholders, in the aggregate, have not elected to purchase all of the Offered
Shares, the Company shall give written notice to that effect to the Transferor
and all Subscribing Shareholders, the subscriptions of the Company and each of
the Subscribing Shareholders shall automatically be void, and, subject to the
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provisions of Section 5 of this Agreement, the Transferor may sell the Offered
Shares to the Transferee, provided, that the sale is consummated within 60 days
of the date the Transfer Notice was received by the Company, and provided,
further, that the sale is in accordance with all the Offered Terms and
Conditions (or otherwise on terms and conditions of the transaction no more
favorable to the Transferee than the terms and conditions on which the Offered
Shares were proposed to be sold to the Company or the Other Shareholders, as set
forth in the Transfer Notice) and upon the terms and conditions set forth in
this Agreement. If the Transferor does not consummate the sale of the Offered
Shares to the Transferee within said 60 day period, the Offered Shares will
thereafter again be subject to this Section 4.
5. CoSale Right in Sale of Voting Control.
(a) Rights of CoSale. If at any time a Transferor, acting alone or
with his Family Members or Affiliates, proposes to transfer Shares in a Sale of
Voting Control to a Transferee, and the Company and the Other Shareholders are
not purchasing the Shares pursuant to the provisions of Section 4 above, each
Other Shareholder which notifies the Transferor in writing within 20 days (the
"CoSale Period") after receipt of the notice from the Company described in
Section 4(e) above, shall have the right (the "CoSale Right") to sell to the
Transferee at the Offered Price and upon the Offered Terms and Conditions a
portion of the number of Shares the Transferor proposes to sell to the
Transferee that is equal to (i) the number of Shares owned by the Other
Shareholder and any of his or its Family Members and Affiliates, multiplied by
(ii) a fraction equal to (x) the number of Shares proposed to be sold to the
Transferee by the Transferor and any of his Family Members and Affiliates,
divided (y) the total number Shares owned by the Transferor and any of his
Family Members and Affiliates; whereupon the Transferor will assign so much of
its interest in the agreement of sale as each Other Shareholder shall be
entitled to and shall request pursuant to this Section 5(a), the number of
Shares to be sold by the Transferor will be reduced by the aggregate number of
Shares to be sold by each Other Shareholder, each Other Shareholder will assume
the part of the obligations of the Transferor under the agreement of sale as
shall relate to the sale of securities by the Other Shareholder and the
Transferor shall not sell any Shares to the Transferee unless the Transferee
concurrently purchases the appropriate number of Shares from each Other
Shareholder who has exercised his or its right to sell under this Section 5(a).
(b) Exercise of CoSale Right. Each of the Other Shareholders who
exercises his or its CoSale Right by delivering to the Transferor during the
CoSale Period notice of intent to exercise shall include in the notice the
number of Shares that the Other Shareholder elects to transfer, which number may
not, without the consent of the Transferor, exceed the number of Shares the
Other Shareholder is permitted to sell pursuant to the CoSale Right. At the
closing of the transfer, each Other Shareholder must provide for sale to the
Transferee, free and clear of all liens and rights of third parties, the one or
more certificates, properly endorsed for transfer or accompanied by stock powers
duly executed in blank, which represent the number of Shares which the Other
Shareholder elects to transfer pursuant to the exercise of his or its CoSale
Right. In the event the certificate or certificates representing the Shares
evidences a greater number of Shares than that elected to be transferred, the
Other Shareholder shall deliver the certificate or certificates to the Company
prior to the closing of the transfer with instructions for the Company to
promptly re-issue new certificates in proper denominations to effect the
transfer. Each Other Shareholder agrees to make the representations and
warranties regarding the Company and its Subsidiaries and his or its ownership
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of the Shares as the Transferor may be required to make to the Transferee,
provided, such representations and warranties shall be reasonably acceptable to
the Other Shareholder and provided, further, that the Other Shareholder's
liabilities for breach of the representations and warranties shall be limited to
the Other Shareholder's proceeds of the sale of his or its Shares pursuant to
the exercise of the CoSale Right, and provided, further, that if any Other
Shareholder is not involved in the business of the Company, any representations
or warranties that the Other Shareholder is required to make to the Transferee
with respect to the business of the Company shall be limited to the best
knowledge of the Other Shareholder.
6. Other Transfers of Shares.
(a) Involuntary Transfers. Any one or more of the following events
or conditions ("Involuntary Transfers") shall be deemed to constitute an offer
to transfer Shares held by any Shareholder:
(i) the event that (A) the Shareholder is adjudicated a
bankrupt, or (B) any action of any nature whatsoever (whether voluntary or
involuntary) is taken for the Shareholder's relief under any bankruptcy,
reorganization, receivership, liquidation, insolvency, compromise, arrangement
or moratorium statute, law or regulation, whether now in force or hereafter
enacted, or (C) any assignment is made for the benefit of the Shareholder's
creditors, or (D) any petition (whether voluntary or involuntary) is made or
filed for the appointment of a receiver, liquidator, trustee or custodian for
any of the Shareholder's assets, or if any receiver, liquidator, trustee or
custodian for any of the Shareholder's assets is appointed, and the petition or
the receiver, liquidator, trustee or custodian is not withdrawn or discharged
within 30 days from the date of filing, making or appointment, or (E) the
Shareholder acknowledges in writing that he or it has become unable to pay its
debts as they become due, or (F) the Shareholder is dissolved or its business is
substantially terminated for any reason whatsoever;
(ii) a determination that the Shareholder is incompetent, and
for this purpose an individual shall be deemed to be incompetent one year
following the occurrence, without subsequent revocation or annulment within the
one year period, of any of the following actions: (a) a conservator of the
person or estate has been appointed for the individual, (b) a court with
jurisdiction has determined that the individual is incompetent or lacks
capacity, or (c) two licensed physicians have certified in writing that in their
opinion the individual is substantially unable to manage his or her financial
resources or resist fraud or undue influence; or
(iii) any other event which, were it not for the provisions of
this Agreement, would cause any Shares, or any interest therein, to be
transferred, for consideration or otherwise, to any person, whether voluntarily,
involuntarily, or by operation of law under circumstances not constituting
approved means of transfer under this Agreement.
Nothing in this Section 6(a) shall be deemed to authorize any transfer not
expressly permitted under Section 3 of this Agreement. Any purported transfer of
any Shares in violation of any of the provisions of this Agreement shall be void
and shall not be recognized by the Company and the purported transferee shall
not be entitled to vote or receive any dividends on or distributions or payments
with respect to the Shares.
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(b) Purchase Rights. Upon the occurrence of any event specified in
Section 6(a) (an "Involuntary Transfer Event"), first the Company and then the
other Shareholders pro rata shall have the right to purchase the Shares as if
the Shareholder had made an offer to sell the Shares.
(c) Purchase Procedures. Within 90 days after the occurrence of an
Involuntary Transfer Event, the Shareholder or his trustee in bankruptcy,
personal representative, conservator, or guardian (as appropriate) shall give
notice to the Company of the Involuntary Transfer Event, specifying the date of
the event and describing in reasonable detail the nature of the Involuntary
Transfer Event and the number of Shares affected. The notice shall be deemed to
be an offer to sell the Shares affected by the Involuntary Transfer Event first
to the Company and then the Other Shareholders pro rata at a price, in cash,
equal to the Fair Market Value of the Shares. If the Company has not received
the notice required by this Section 6(c), upon the expiration of the 90-day
period, any shareholder, director or officer of the Company who has knowledge of
the event may give notice to the Company at anytime, and each Shareholder hereby
agrees that any such notice shall be deemed to be an offer on behalf of the
Shareholder or his estate to sell the Shares affected by the event delivered as
required by the first sentence of this Section 6(c). The offer to sell the
Shares affected by the event may be accepted by the Company at any time within
30 days after receipt of the offer by the Company. If the Company does not elect
to purchase all of the Shares, any remaining Shares affected by the event shall
be offered to the other Shareholders in accordance with the allocation
procedures set forth in Section 4(c) of this Agreement. The Company and, if the
Company declines to purchase all of the Shares, the other Shareholders shall
have the right to purchase all or any portion of the Shares offered for sale
pursuant to this Section 6(c).
(d) Determination of Fair Market Value of Shares Procedures. At the
time the Company or, if the Company declines to exercise the option for any
reason, a Shareholder (in either case, a "Purchaser") first exercises its option
to purchase Shares from a Shareholder under this Section 6, the Purchaser shall
submit to the Shareholder or his estate a written estimate of the per share Fair
Market Value of the Common Stock. The valuation shall be conclusive on the
Shareholder unless the Shareholder responds in a like manner within 30 days
following receipt of the Purchaser's estimate. If the Shareholder and the
Purchaser do not reach agreement as to the per Share Fair Market Value within 45
days following the Purchaser's exercise of its option to purchase, the
determination of the per share Fair Market Value shall be made by arbitration.
Only one arbitration proceeding may be conducted pursuant to this Section 6(d)
in connection with each sale of Shares upon an Involuntary Transfer Event. Once
arbitration proceedings have been commenced under this Section 6(d), no other
Purchaser may bring arbitration proceedings in connection with the same
transaction unless the arbitration proceedings are terminated without a
determination of Fair Market Value. To institute arbitration proceedings, the
Purchaser shall appoint an independent qualified appraiser, and notify the
Shareholder and the other Shareholders of his or its election. If the
Shareholder does not deliver written notice of appointment of another
independent qualified appraiser within 10 days after receipt of the Purchaser's
notice, the Purchaser's appraiser shall determine Fair Market Value. If the
Shareholder delivers the notice, the two appraisers shall appoint a third
independent qualified appraiser who shall determine the Fair Market Value. The
determination of the Fair Market Value completed in the manner provided in this
Section 6(d) shall be conclusive and binding upon the Shareholder and the
Purchaser, and all other parties to this Agreement. In no event, however, shall
the Fair Market Value determined by the arbitrator or arbitrators be outside of
the range of estimates of the Fair Market Value submitted by the Purchaser and
the Shareholder. The
10
<PAGE> 70
cost of the appraisal shall be paid by the party whose estimate of Fair Market
Value most varies from the value determined by the arbitrator (or if the
parties' estimates vary equally, the cost of the appraisal share be borne
equally between them). In connection with these valuations, the Company will, on
a confidential basis, deliver or provide access to each appraiser of all
information reasonably requested by the appraiser in order to determine the Fair
Market Value.
7. Restrictive Endorsement on Share Certificates. The face of each
certificate representing Shares now or hereafter held by a Shareholder shall be
stamped with a legend in substantially the following form:
"THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE
SECURITIES LAWS, HAVE BEEN TAKEN FOR INVESTMENT, AND MAY NOT BE SOLD OR
OFFERED FOR SALE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAW OR AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED."
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A SHAREHOLDERS
AGREEMENT DATED AS OF ________,1999, AS AMENDED FROM TIME TO TIME, A COPY
OF WHICH IS ON FILE AT THE OFFICE OF THE COMPANY AND WILL BE FURNISHED TO
ANY PROSPECTIVE PURCHASERS ON REQUEST. THE SHAREHOLDERS AGREEMENT
PROVIDES, AMONG OTHER THINGS, FOR CERTAIN RESTRICTIONS ON THE SALE,
TRANSFER, PLEDGE, HYPOTHECATION OR OTHER DISPOSITION OF THE SHARES
REPRESENTED BY THIS CERTIFICATE."
8. Agreements of Certain Spouses. This Agreement has been executed by the
respective spouses (the "Spouses") of the married Shareholders who are residents
of the State of California, each of whom may claim a community property or other
interest in the Shares from time to time held by his spouse (the "Community
Shares"). Each Spouse hereby represents and agrees that he or she has read and
understands the provisions of this Agreement and the effect of the provisions on
any community property or other interest he or she may have in the Community
Shares, including, among other things, the options of the Company and the
Shareholders other than his or her spouse to purchase the Shares pursuant to
this Agreement and the restrictions on Transfer of the Shares pursuant to
Section 2 of this Agreement.
9. Termination of Existing Agreements. Effective as of the date of this
Agreement, each and every provision of the 1998 Shareholders' Agreement and the
Buy-Sell Agreement, and Sections 6 through 19 of each of the Stock Subscription
Agreements, shall terminate and be of no further force or effect.
10. Board of Directors. The Company and the Existing Shareholders agree to
use their best efforts to cause two nominees designated by the Member
Representative to be elected and
11
<PAGE> 71
continued in office as directors of each of the Company and FX until a Qualified
Public Offering and for so long as the Holders own in the aggregate at least 5%
of the outstanding shares of Company Common Stock assuming (if the Exchange has
not previously occurred) the issuance by the Company of the Exchange Shares to
the Holders effective as of the record date established by the Board of
Directors of the Company for determining the shares of Company Common Stock
entitled to vote for the election of directors. The Company and the Existing
Stockholder will use their best efforts to cause the two nominees to be elected
or appointed to the Board of Directors of each of the Company and FX within 30
days following the date of this Agreement.
11. Miscellaneous
(a) Notices. Any and all notices, designations, consents, offers,
acceptances, or any other communications provided for in this Agreement shall be
given in writing by hand delivery or registered or certified mail which shall be
addressed, (i) in the case of the Company, to 5111 U.S. Highway 19 North, Suite
300, Palm Harbor, Florida 34684, Attn: President, and (ii) in the case of any
Shareholder, to the address of the party in records of the Company (or to such
other addresses as may be designated by the party). Except as otherwise provided
in this Agreement, each notice shall be deemed given at the time it is received.
(b) Amendment. Except as hereinafter provided no change or
modification of this Agreement shall be valid unless the same shall have been in
writing and signed by (i) all of the Shareholders and (ii) the Company. This
Agreement shall be automatically amended to include any additional Shareholders
who execute a counterpart of this Agreement.
(c) Termination. This Agreement shall terminate and expire on the
earliest to occur of (i) a Qualified Public Offering, and (ii) January 15, 2029;
provided, however, that this Agreement may be terminated at any time by an
instrument in writing signed by (x) all of the Shareholders and (y) the Company;
and provided, further, however, that the term of this Agreement may be extended
beyond January 15, 2029 if, at any time prior to such date, all of the parties
extend its duration for as many additional periods as they may desire. Whenever
the restrictions imposed hereby shall terminate, as hereinabove provided, the
holder of the Shares as to which such restrictions shall have terminated shall
be entitled to receive from the Company, without expense, a new stock
certificate or certificates not bearing the restrictive legend set forth in this
Agreement, and not containing any other reference to the restrictions imposed
hereby
(d) Waiver. No failure or delay on the part of the Shareholders or
any of them in exercising any right, power or privilege hereunder, and no course
of dealing between the Company and the Shareholders or any of them shall operate
as a waiver thereof nor shall any single or partial exercise of any right, power
or privilege hereunder preclude the simultaneous or later exercise of any other
right, power or privilege. The rights and remedies in this Agreement expressly
provided are cumulative and not exclusive of any rights or remedies which the
Shareholders or any of them would otherwise have. No notice to or demand on the
Company in any case shall entitle the Company to any other or further notice or
demand in similar or other circumstances or constitute a waiver of the rights of
the Shareholders or any of them to take any other or further action in any
circumstances without notice or demand.
12
<PAGE> 72
(e) Equitable Relief. The parties to this Agreement agree and
declare that legal remedies may be inadequate to enforce the provisions of this
Agreement and that equitable relief including specific performance and
injunctive relief, may be used to enforce the provisions of this Agreement.
(f) Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
(g) Construction. When necessary, the masculine shall include the
feminine or neuter and the singular shall include the plural and vice versa.
(h) Governing Law. This Agreement shall be governed and construed in
accordance with the laws of the State of California, without regard to conflicts
of law principles thereof.
(i) Benefit and Binding Effect. This Agreement shall be binding upon
and shall inure to the benefit of the Company, its successors and assigns, and
each of the Shareholders and their respective executors, administrators and
personal representatives and heirs and their successors and assigns. In the
event that any part of this Agreement shall be held to be invalid or
unenforceable, the remaining parts thereof shall nevertheless continue to be
valid and enforceable as though the invalid portions were not a part of this
Agreement. Except as expressly provided above, this Agreement does not create,
and shall not be construed to create, any rights enforceable by any person not a
party to this Agreement.
(j) Future Spousal Consents. Each Shareholder who is a resident of
the State of California and is not presently married agrees to use his best
efforts to cause any future spouse to execute and deliver to the Company a
signed counterpart of the spousal consent attached to this Agreement as Exhibit
C.
(k) Further Assurances. Each party to this Agreement agrees to
perform any further acts and to execute and deliver any further documents that
may be reasonably necessary to carry out the provisions of this Agreement,
including without limitation any voting trust agreement or irrevocable proxy,
that may be required to secure performance of any Shareholder's duties under
this Agreement or assure the legal, binding effect of the provisions of this
Agreement under the Florida General Corporation Act in each case as the same may
from time to time be amended.
13
<PAGE> 73
IN WITNESS WHEREOF, the parties to this Agreement have signed this
Agreement as of the day and year first above written.
DYNACS ENGINEERING COMPANY INC.,
a Florida corporation
By: ____________________________________
Ramendra P. Singh
Its: President
THE EXISTING SHAREHOLDERS:
_________________________________________
Ramendra P. Singh
_________________________________________
Peter Likins
_________________________________________
Robert Skelton
_________________________________________
Javier E. Benavente
_________________________________________
Jayant Ramakrishnan
_________________________________________
Harry W. Schubele
_________________________________________
Ravi Venugopal
_________________________________________
Ramesh Venugopal
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
14
<PAGE> 74
[SIGNATURES CONTINUED]
INVESTORS:
_________________________________________
Michael Burns
_________________________________________
William Dallas
_________________________________________
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By: _______________________________
Its: _______________________________
15
<PAGE> 75
EXHIBIT A
EXISTING SHAREHOLDERS
AND OUTSTANDING SHARES
---------------------------------------------------------
Shareholder Number of Shares
---------------------------------------------------------
Ramendra P Singh 2,887,500
---------------------------------------------------------
Peter Likins 350,000
---------------------------------------------------------
Robert Skelton 437,500
---------------------------------------------------------
Javier E. Benavente 175,000
---------------------------------------------------------
Jayant Ramakrishnan 175,000
---------------------------------------------------------
Harry W. Schubele 175,000
---------------------------------------------------------
Ravi Venugopal 175,000
---------------------------------------------------------
Ramesh Venugopal 78,750
---------------------------------------------------------
Total 4,453,750
---------------------------------------------------------
Exhibit A
<PAGE> 76
EXHIBIT B
INVESTORS
------------------------------------
Michael Burns
------------------------------------
William Dallas
------------------------------------
Jon Feltheimer
------------------------------------
Offense Group Associates, LP
------------------------------------
Exhibit B
<PAGE> 77
EXHIBIT C
SPOUSAL CONSENT
The undersigned, _________________________, acknowledges that she has read
the foregoing Shareholders Agreement, dated as of ___________, 1999 (the
"Agreement"), and she knows the contents thereof The undersigned is aware that
by the provisions of the Agreement she agrees to sell a portion or all shares of
Common Stock of Dynacs Engineering Company, Inc., a Florida corporation
(referred to in the Agreement as the "Company"), including any interest she may
have in such shares (marital or otherwise), if any, which would be equivalent to
a spousal interest by virtue of her relationship with ________________________
upon the occurrence of certain events, and the undersigned hereby consents to
such sale and agrees to be bound by each and every provision of the Agreement.
_______________________________________
Name:
Exhibit C
<PAGE> 78
EXHIBIT C
to
CONTRIBUTION AND EXCHANGE AGREEMENT
Dated as of August 12, 1999
FORM OF REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agent"), is made and entered
into as of ____________, 1999, by and among DYNACS ENGINEERING COMPANY, INC., a
Florida corporation (the "Corporation"), and those stockholders whose names
appear on the signature page to this Agreement (collectively referred to in this
Agreement as the "Stockholders" and each as a "Stockholder").
RECITALS
A. The Corporation and the Stockholders are parties to that certain
Contribution and Exchange Agreement, dated as of August 12, 1999 (the
"Contribution Agreement"), which agreement provides for, among other things, the
issuance by Cerulean FXs, Inc., a Florida corporation ("FX") of shares of its
common stock, par value $0.01 per share (the "FX Common Stock") to the
Corporation and each of the Stockholders in exchange for the contribution by the
Corporation and each of the Stockholders of their limited liability company
interests in Cerulean Colorization, L.L.C., a Delaware limited liability
company.
B. Concurrent with the execution and delivery of this Agreement, the
Corporation and the Stockholders are entering into that certain Exchange
Agreement (the "Exchange Agreement"), which agreement grants to the Stockholders
the right to exchange their shares of FX Common Stock for shares of common
stock, par value $.00l per share, of the Corporation (the "Common Stock") upon
the occurrence of certain events.
C. In connection with the transactions contemplated by the Contribution
Agreement and the Exchange Agreement, the parties to this Agreement have agreed
that the Corporation will provide to each of the Stockholders certain
registration rights, as set forth in this Agreement. The execution and delivery
of this Agreement by each of the parties to this Agreement are conditions
precedent to the closing of the Contribution Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of foregoing premises and of the mutual
covenants and agreements contained in this Agreement, on the terms and subject
to the conditions set forth in this Agreement, the parties to this Agreement
agree as follows:
<PAGE> 79
1. Definitions
(a) Definitions. Capitalized terms used in this Agreement and not
defined in this Agreement shall have the meanings given those terms in the
Exchange Agreement, Otherwise, the following terms have the following meanings,
unless the context otherwise requires:
"Commission" means the Securities and Exchange Commission or
any other federal agency at the time administering the Securities Act.
"Existing Stockholders" means Ramen Singh, Peter Likins,
Robert Skelton, Javier Benavente, Jayant Ramakrishnan, Harry Schubele,
Ravi Venugopal and Ramesh Venugopal.
"Other Holder" shall have the meaning given such term in
Section 2 of this Agreement.
"Person" means any individual, corporation, partnership, firm,
joint venture, association, joint-stock company, trust, incorporated
organization or other entity.
"Prospective Seller" shall have the meaning given such term in
Section 4(a) of this Agreement.
"Registrable Stock" means (a) any and all Securities acquired
or to be acquired by any of the Stockholders under and pursuant to the
Contribution Agreement and the Exchange Agreement, and any and all
Securities issued under this clause (a) acquired by a Stockholder from any
other Stockholder; (b) any Securities issued or issuable with respect to
the securities described in clause (a) above by reason of a share dividend
or share split or similar transaction, or in connection with a combination
of shares, recapitalization, merger, consolidation, other reorganization
or other transaction, and (c) any other Securities now held or acquired
after the date of this Agreement by Persons holding the Securities
described in clauses (a) or (b) above. As to any particular Registrable
Stock, such securities shall cease to be Registrable Stock when (w) a
registration statement with respect to the sale of such securities shall
have become effective under the Securities Act and such securities shall
have been disposed of in accordance with such registration statement, (x)
such securities shall have been sold as permitted by Rule 144 or Rule 144A
(or any successor provisions) promulgated under the Securities Act, (y)
such securities shall have been otherwise transferred, new certificates
for them not bearing a legend restricting further transfer shall have been
delivered by the Company and subsequent public distribution of them shall
not require registration under the Securities Act, or (z) such securities
are eligible for sale pursuant to Rule 144 promulgated under the
Securities Act without limitation as to the amount of securities to be
sold.
The terms "register", "registered" and "registration" each
refer to a registration of securities effected by preparing and filing a
Registration Statement as to the securities in compliance with the
Securities Act, and the subsequent effectiveness of the Registration
Statement.
2
<PAGE> 80
"Registration Statement" means a registration statement filed
by the Corporation with the Commission under the Securities Act (other
than a registration statement on Form S-4 or S-8 or any successor or
similar forms, or a registration statement on any form filed in connection
with an exchange offer or an offering of securities solely to the
Company's existing shareholders).
"Securities" means any equity securities of the Corporation.
Any beneficial interests in the Securities are referred to in this
Agreement as "shares" of the Securities.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Registration" means any registration of shares of
any Securities of any class of the Corporation, whether for its own
account or the account of another, effected pursuant to a Registration
Statement.
(b) Rules of Construction. The following rules of construction shall
apply in interpreting this Agreement:
(i) A Person shall be deemed to be a holder of Registrable
Stock when such Person has, or will have on or prior to the date any
Securities are registered, an exercisable right to acquire Registrable
Stock. Each share of Registrable Stock shall continue to be Registrable
Stock in the hands of each subsequent holder of the Registrable Stock; and
for purposes of this Agreement, the term "Stockholders" shall be deemed to
include each subsequent holder of Registrable Stock, and each of these
holders shall have the right to exercise any and all rights granted under
this Agreement to the Stockholders.
(ii) This Agreement has been entered into concurrently with
the execution of the Exchange Agreement and the Contribution Agreement,
and, unless the context otherwise clearly requires, this Agreement shall
be construed in a manner consistent with the provisions of the Exchange
Agreement and the Contribution Agreement.
2. Registration. If the Corporation at any time proposes to register any
securities pursuant to a Securities Registration, it shall each time give
written notice of the proposed Securities Registration (the "Corporation's
Notice"), at its expense, to each of the Stockholders and to all other holders
of securities of the Corporation who have the contractual right to include all
or any portion of their shares in the registration on a "piggyback" basis (the
"Other Holders") at least 15 days prior to the filing of a Registration
Statement with respect to the Securities Registration with the Commission. Upon
written request of any of the Stockholders (each, a "Stockholder's Notice") or
Other Holder (a "Holder's Notice") given within is days after receipt of the
Corporation's Notice, stating the number of shares of Registrable Stock to be
disposed of by the Stockholder delivering the Stockholder's Notice, or the
number of shares of Securities to be disposed of by the Other Holder delivering
the Holder's Notice, the Corporation shall use its best efforts to cause all
shares of Registrable Stock specified in each Stockholder's Notice, or shares of
Securities specified in each Holder's Notice, to be registered under the
Securities Act so as to permit the sale or other disposition (in accordance with
the intended methods as set forth in the Corporation's Notice) of the shares,
subject, however, to the limitations set forth in Section 3 of this Agreement;
provided, however, that
3
<PAGE> 81
the Corporation shall have the right in its sole and absolute discretion to
elect not to file, postpone or withdraw any registration effected pursuant to
this Section 2 without obligation to the Stockholders or Other Holders except as
provided in this Section 2; and provided, further, that the Stockholders' and
Other Holders' rights to include all or any portion of their shares in an
underwritten offering shall be subject to the right of the managing underwriters
in the offering to exclude such shares as provided in Section 3 of this
Agreement.
3. Limitations on Securities Registration
(a) Underwritten Offerings. If any Securities Registration is for an
underwritten offering, only securities of the class and series which are to be
included in the underwriting may be included in the registration, the issuance
and sale of securities by the Corporation shall have priority as to sales to and
by the underwriters in the registration, and the Stockholders hereby agree that
they shall withdraw their securities from the registration if and to the extent
requested to do so in good faith by the managing underwriters of the offering to
facilitate the complete sale of the securities being registered. In connection
with an underwritten offering, the Corporation shall not be required to include
any Registrable Stock in such offering unless the Stockholders accept the terms
of the underwriting as agreed upon between the Corporation and the underwriters
selected by the Corporation and execute an underwriting agreement reflecting
such terms (provided that such terms are consistent with this Agreement), and
then only in such quantity as will not, in the good faith opinion of the
managing underwriter, jeopardize the success of the offering by the Corporation.
(b) Scale-Back Procedures. Whenever the number of shares which may
be registered pursuant to Section 2 of this Agreement is limited by the
provisions of Section 3(a), above, the Corporation will include in the
registration (i) first, the securities the Corporation proposes to sell, and
(ii) second, the securities requested to be sold pro rata among the Stockholders
and all Other Holders, allocated on the basis of the number of shares owned by
each; provided, that if any Stockholder or Other Holder would thus be entitled
to include more shares than the Stockholder or Other Holder requested to be
registered, the excess will be allocated to the other Stockholders and Other
Holders, until the full amount of shares requested by any Stockholder or Other
Holder has been registered for sale. The Corporation shall use its best efforts
to cause any other affected holders to withdraw from the registration to the
extent necessary to comply with the foregoing priority provisions.
4. Registration Procedures.
(a) Obligations of the Corporation. If and whenever the Corporation
is required by the provisions of this Agreement to use its best efforts to
effect the registration of shares (as used in this Section 4, the "Shares") of
Registrable Stock held by any Person (each, a "Prospective Seller") under the
Securities Act, the Corporation shall:
(i) prepare and file with the Commission a Registration
Statement with respect to the Shares and use its best efforts to cause the
Registration Statement to become and remain effective as provided in this
Agreement;
4
<PAGE> 82
(ii) prepare and file with the Commission any amendments and
supplements to the Registration Statement and the prospectuses used in
connection with the Registration Statement as may be necessary to keep the
Registration Statement effective and current, in the case of a firm
commitment underwritten public offering, until each underwriter has
completed the distribution of all securities purchased by it and, in the
case of any other offering, until the earlier of the sale of all Shares
covered thereby or 90 days after the effective date of the Registration
Statement, and to comply with the provisions of the Securities Act with
respect to the sale or other disposition of all Shares covered by the
Registration Statement;
(iii) furnish to each Prospective Seller the number of copies
of each prospectus, including preliminary prospectuses, in conformity with
the requirements of the Securities Act, and all other documents, as the
Prospective Seller may reasonably request in order to facilitate the
public sale or other disposition of the Shares owned by the Prospective
Seller;
(iv) use its best efforts to register or qualify the Shares
covered by the Registration Statement under the other securities or blue
sky or other applicable laws of the jurisdictions as each Prospective
Seller shall reasonably request, to enable each Prospective Seller to
consummate the sale or other disposition of the Shares owned by the
Prospective Seller;
(v) furnish to each Prospective Seller a signed counterpart,
addressed to the Prospective Seller and his or its underwriters, if any,
of:
(A) an opinion of counsel for the Corporation, dated the
effective date of the Registration Statement and, if requested, the date
of each closing of sales pursuant to the registration, with respect to the
effective registration of such Shares; and
(B) if and to the extent then available under FASB and
related pronouncements, a "comfort" letter signed by the independent
public accountants who have certified the Corporation's financial
statements included in the Registration Statement, similarly dated;
covering substantially the same matters with respect to the Registration
Statement (and the prospectuses included in the Registration Statement)
and (in the case of the accountants' letter) with respect to the events
subsequent to the date of the financial statements, as are customarily
covered (at the time of the registration) in the opinions of issuers'
counsel and in accountants' letters delivered to the underwriters in
connection with underwritten public offerings of securities;
(vi) cause all Shares to be listed on each securities exchange
on which similar securities issued by the Corporation are then listed;
(vii) provide a transfer agent and registrar for all Shares
not later than the effective date of the Registration Statement;
5
<PAGE> 83
(viii) enter into all customary agreements (including an
underwriting agreement in customary form) and take all customary actions
as the Member Representative may reasonably request in order to expedite
or facilitate the disposition of the Shares;
(ix) use its best efforts to cause the Corporation's officers,
directors and employees to supply all information reasonably requested in
connection with the registration by any Prospective Seller, any
underwriter participating in any disposition pursuant to the Registration
Statement, and any attorney, accountant or other agent retained by any
Prospective Seller or underwriter, including, without limitation, all
financial and other records, pertinent corporate documents and properties
of the Corporation;
(x) notify each Prospective Seller at any time when a
prospectus relating to Shares covered by the Registration Statement is
effective, of the happening of any event as a result of which the
prospectus included in the Registration Statement, as then in effect,
includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then
existing. The Corporation shall use its reasonable efforts promptly to
amend or supplement the Registration Statement to correct any such untrue
statement or omission; and
(xi) notify each Prospective Seller of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or the initiation of any proceedings for that
purpose. The Corporation will make every reasonable effort to prevent the
issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible time.
(b) Obligations of the Prospective Sellers. In connection with the
registration of Shares held by a Prospective Seller, the Prospective Seller
shall:
(i) furnish to the Corporation all information the Corporation
may reasonably require from the Prospective Seller for inclusion in the
Registration Statement (and the prospectus included in the Registration
Statement); and
(ii) upon notification by the Corporation of a state of facts
described in Section 4(a)(x) or of a stop order referenced in Section 4(a)(xi),
cease making sales of Shares unless and until the Corporation shall notify the
Prospective Seller that the state of facts has been corrected and/or the stop
order has been lifted.
5. Expenses of Registration. All expenses incurred in effecting any
registration under this Agreement, including, without limitation, all
registration and filing fees, printing expenses, expenses of compliance with
blue sky laws, fees and disbursements of counsel for the Corporation, fees and
disbursements of counsel for the Prospective Sellers (but not more than one
counsel representing all of the Stockholders who are Prospective Sellers), and
expenses of any audits incidental to or required by any registration
("Registration Expenses") shall be borne by the Corporation; provided, that all
underwriting discounts or brokerage fees or commissions relating to
6
<PAGE> 84
the sale of the securities included in the registration shall be separately
borne by the sellers of the securities.
6. Indemnification
(a) Indemnity In the event of any registration of any of its
securities under the Securities Act pursuant to this Agreement, the Corporation
shall indemnify and hold harmless each Prospective Seller, each underwriter (as
defined in the Securities Act) and each controlling person (within the meaning
of the Securities Act), if any, of any Prospective Seller or underwriter
(collectively, "Indemnified Parties" or an "Indemnified party"), against any
losses, claims, damages or liabilities, joint or several (or actions in respect
thereof), to which the Indemnified Parties may be subject under the Securities
Act or any other statute or at common law, insofar as the losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon (i) any untrue statement (or alleged untrue statement) of any material fact
contained in any Registration Statement under which the securities were
registered under the Securities Act, any preliminary prospectus or final
prospectus contained in the Registration Statement, or any summary prospectus
issued in connection with any securities being registered, or any amendment or
supplement thereto, or any other document used to sell the securities, or (ii)
any omission (or alleged omission) to state in any Registration Statement under
which the securities were registered under the Securities Act, any preliminary
prospectus or final prospectus contained in the Registration Statement, or any
summary prospectus issued in connection with any securities being registered, or
any amendment or supplement thereto, or any other document or any other document
used to sell the securities, a material fact required to be stated therein or
necessary to make the statements therein not misleading, or (iii) any violation
of the Securities Act or any Blue Sky law, or any rule or regulation promulgated
under the Securities Act or any Blue Sky law, or any other law, in connection
with any registration, qualification or compliance, and shall reimburse the
Indemnified Parties for any legal or other expenses incurred by the Indemnified
Parties in connection with investigating or defending any loss, claim, damage,
liability or action described above; provided, however, that the Corporation
shall not be liable to any Indemnified Party (i) to the extent that any loss,
claim, damage or liability arises out of or is based upon any untrue statement
or omission made in the Registration Statement, preliminary prospectus, summary
prospectus, prospectus, or amendment or supplement thereto, or any other
document used to sell the securities, in reliance upon and in conformity with
information furnished to the Corporation by that Indemnified Party, or party
controlling or controlled by that Indemnified Party within the meaning of the
Securities Act specifically for use in the registration, or (ii) to the extent
that any such loss, claim, damage, or liability does not arise out of or is not
based upon any untrue statement or omission made in such Registration Statement,
if any Indemnified Person who participates as an underwriter in the offering, or
who controls an underwriter in the offering, failed to give or send a final
prospectus at or prior to written confirmation of sale. The indemnity provided
for in this Section 6(a) shall remain in full force and effect regardless of any
investigation made by or on behalf of any Indemnified Party and shall survive
transfer of the securities by the Indemnified Party.
(b) Prospective Sellers. In the event of any registration of any of
the Corporation's securities under the Securities Act in which a Prospective
Seller participates pursuant to this Agreement, each participating Prospective
Seller agrees to indemnify and hold harmless the Corporation, its directors,
each underwriter (as defined in the Securities Act) and each controlling
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person (within the meaning of the Securities Act) of the Corporation or
underwriter, if any, against any losses, claims, damages or liabilities, joint
or several (or actions in respect thereof), to which the Corporation, director,
underwriter or controlling person may be subject under the Securities Act, under
any other statute or at common law, insofar as the losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement (or alleged untrue statement) of any material fact contained in
any Registration Statement under which the securities were registered under the
Securities Act, any preliminary prospectus or final prospectus contained in the
Registration Statement, or any summary prospectus issued in connection with any
securities being registered, or any amendment or supplement thereto, or any
other document used to sell the securities, or any omission (or alleged
omission) to state in the Registration Statement, any preliminary prospectus or
final prospectus contained in the Registration Statement, or any summary
prospectus issued in connection with any securities being registered, or any
amendment or supplement thereto, or any other document or any other document
used to sell the securities, a material fact required to be stated therein or
necessary to make the statements therein not misleading, and shall reimburse the
Corporation, its directors, each underwriter, and each controlling person, for
any legal or other expenses reasonably incurred by these persons in connection
with investigating or defending any loss, claim, damage, liability or action; in
each case, to the extent, and only to the extent, that the untrue statement or
omission is contained in any information or affidavit furnished in writing to
the Corporation by the Prospective Seller specifically for use in the
registration. The indemnity provided for in this Section 6(b) shall survive
transfer of the securities by the Prospective Seller.
(c) Contribution. If the indemnification provided for in Section
6(a) or (b) is unavailable to an indemnified party in accordance with its terms
in respect of any losses, claims, damages or liabilities referred tom Section
6(a) or (b), then the indemnitor in lieu of indemnifying the indemnified party
under Section 6(a) or (b) shall contribute to the amount paid or payable by the
indemnified party as a result of the losses, claims, damages or liabilities, in
such proportion as is appropriate to reflect the relative fault of the
indemnitor on the one hand and of the indemnified parties on the other in
connection with the statements or omissions which resulted in the losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the indemnitor and of the indemnified
parties shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission to state a
material fact relates to information supplied by the indemnitor, or the
indemnified parties, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent the statement or omission.
The Corporation and the other parties to this Agreement agree
that it would not be just and equitable if contribution pursuant to this Section
6(c) were determined by a mechanical pro rata allocation or by any other method
of allocation which does not take account of the equitable considerations
referred to in the immediately preceding paragraph. The amount paid or payable
by any indemnified party as a result of the losses, claims, damages and
liabilities or actions in respect thereof referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by the indemnified
party in connection with investigating or defending the action or claim.
Notwithstanding the provisions of this Section 6(c), no holder of Registrable
Stock, no underwriter of Registrable Stock, and no controlling party of any of
them, shall be required to contribute any amount in excess of the amount by
which the total price at which the Registrable Stock was sold exceeds the amount
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of any damages which the Person has otherwise been required to pay and has
actually paid by reason of the untrue or alleged untrue statement or omission or
alleged omission. No person guilty of a fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who was not guilty of the fraudulent
misrepresentation.
(d) Procedures. Promptly after receipt by any Indemnified Party of a
complaint, claim or other written notice of any loss, claim, damage, liability
or action giving rise to a claim for indemnification under this Section 6, the
party claiming indemnification under this Section 6 shall notify the
indemnifying party of the complaint, notice, claim or action, and the
indemnifying party shall have the right to investigate and defend the loss,
claim, damage, liability or action; provided, that the failure of the
Indemnified Party to promptly notify the indemnifying party shall not relieve
the indemnifying party from any liability which it may have to the Indemnified
Party otherwise than under Section 6, or under Section 6 to the extent that the
indemnifying party has not been materially prejudiced as a proximate result of
the failure to provide notice. The Indemnified Party shall have the right to
employ separate counsel in the action and to participate in the defense of the
action, but the fees and expenses of the counsel shall not be at the expense of
the indemnifying party. If the defendants in any action shall include more that
one Indemnified Party, and any of these Indemnified Parties shall reasonably
conclude that counsel selected by the Corporation has a conflict of interest
which under the Rules of Professional Conduct of the Florida State Bar
Association (or other body regulating the practice of law in the State of
Florida) would prohibit the representation because of the availability of
different or additional defenses to any of the Indemnified Parties, the
indemnified Party shall have the right to select separate counsel reasonably
acceptable to the Corporation to participate in the defense of the claim on its
behalf, at the expense of the indemnifying party who would otherwise be liable
for the losses under this Section 6, it being understood, however, that the
indemnifying party shall not, in connection with any one action or proceeding or
separate but substantially similar or related actions or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the fees and expenses of more than one separate firm of attorneys at
any time for the Indemnified Parties; provided, however, that if the parties
shall not agree that a conflict of interest between the Indemnified Parties
exists, then the parties shall submit the issue to the State Bar Association of
Florida to determine whether a conflict of interest exists, and the
determination of the State Bar Association of Florida shall be binding on the
parties. The Indemnified Parties shall cooperate fully in the defense of any
claim under this Section 6 and each Indemnified Party shall make available to
the Corporation pertinent information under the Indemnified Party's control
relating to the claim. In no event shall the indemnifying party be obligated to
indemnify any party for any settlement of any claim or action effected without
the indemnifying party's consent.
7. Rights Which May Be Granted to Other Persons. The Corporation shall not
grant any Person registration rights with priority as to registration or sale to
underwriters which are greater than or pari passu to the registration rights
granted to the Stockholders in this Agreement; provided that the Company may
grant registration rights to the Existing Stockholders, or any of them, with
respect to the shares of Common Stock owned by them on the date of this
Agreement, which are pari passu to the registration rights granted to the
Stockholders in this Agreement.
8. Rule 144 Requirements. At all times after the close of business on the
earliest of the date (a) a Registration Statement filed by the Corporation under
the Securities Act becomes effective,
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(b) the Corporation registers a class of securities under Section 12 of the
Securities Exchange Act of 1934, as amended, or (c) the Corporation issues an
offering circular meeting the requirements of Regulation A under the Securities
Act, the Corporation shall undertake to make publicly available, and available
to the Stockholders, the information that is necessary to enable the
Stockholders to make sales of Registrable Stock pursuant to Rule 144 of the
Commission under the Securities Act. The Corporation shall from time to time
furnish to each of the Stockholders, upon request, a written statement executed
by the Corporation as to the steps it has taken to comply with the current
public information requirements of Rule 144.
9. Hold-Back Agreements.
(a) By Michael Burns. Michael Burns, a Stockholder, agrees not to
effect any public sale or distribution of Securities, or securities convertible
into or exchangeable or exercisable for Securities, during the seven days prior
to and the period of 180 days, or a longer period (which shall not, in any
event, exceed 270 days) as may be requested by the underwriters, beginning on
the effective date of any Securities Registration which includes a firmly
underwritten offering, except, in each case, as part of the underwritten
offering.
(b) By Corporation and Other Stockholders. The Corporation agrees
(i) not to effect the public sale or distribution of Securities, or of any
securities convertible into or exchangeable or exercisable for any Securities,
during the seven days prior to and the period of 180 days, or a longer period
(which shall not, in any event, exceed 270 days) as may be requested by the
underwriters, beginning on the effective date of any Securities Registration
which includes a firmly underwritten offering, and (ii) to use its best efforts
to cause each holder of Securities, or of any securities convertible into or
exchangeable or exercisable for Securities purchased from the Corporation at any
time on or after the date of this Agreement (other than in a registered public
offering) and who is an officer or director of the Corporation, or owns more
than 5% of any class of its then outstanding Securities, to agree not to effect
any public sale or distribution of any Securities during this period, except as
part of the underwritten offering.
10. Miscellaneous
(a) Notices. All notices, demands or other communications under this
Agreement shall be in writing and shall be deemed to have been truly given if
delivered in person, or by United States mail, certified or registered, return
receipt requested or otherwise actually delivered:
(i) if to any of the Stockholders, at the address set forth
for the Stockholder on the Corporation's records; and
(ii) if to the Corporation, at the address of the Corporation
as set forth in the Contribution Agreement, marked for attention as
therein indicated;
or such other address as may have been furnished by the Person in writing to the
other parties. Any notice, demand or other communication shall be deemed to have
been given on the date actually delivered or as of the date mailed, as the case
may be.
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(b) Severability and Governing Law. Should any Section or any part
of a Section within this Agreement be rendered void, invalid or unenforceable by
any court of law for any reason, the invalidity or unenforceability shall not
void or render invalid or unenforceable any other Section or part of a Section
in this Agreement. This Agreement shall be governed and construed in accordance
with the laws of the State of California applicable to contracts made and to be
performed entirely within the State of California, without regard to principles
of conflicts of law.
(c) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
(d) No Adverse Construction. The rule that a contract is to be
construed against the party drafting the contract is hereby waived, and shall
have no applicability in construing this Agreement or the terms of this
Agreement.
(e) Captions and Section Headings. Section titles or captions
contained in this Agreement are inserted as a matter of convenience and for
reference purposes only, and in no way define, limit, extend or describe the
scope of this Agreement or the intent of any provision hereof.
(f) Amendments and Waivers. This Agreement may be amended, modified,
superseded, canceled, renewed or extended, and the terms and conditions hereof
maybe waived, only by a written instrument signed by all the parties to this
Agreement or, in the case of a waiver, by the party or parties, as the case may
be, waiving compliance. No delay on the part of any party in exercising any
right, power or privilege under this Agreement shall operate as a waiver thereof
nor shall any waiver on the part of any party of any right, power or privilege
under this Agreement, nor any single or partial exercise of any right, power or
privilege under this Agreement, preclude any other or further exercise thereof
or the exercise of any other right, power or privilege under this Agreement.
(g) Costs and Attorneys' Fees. In the event that any action, suit or
other proceeding is instituted concerning or arising out of this Agreement, the
prevailing party shall be entitled to recover all of the prevailing party's
costs and reasonable attorneys' fees incurred in each and every such action,
suit, or other proceedings, including any and all appeals or petitions
therefrom.
(h) Successors and Assigns. Except as otherwise provided in this
Agreement, all rights, covenants and agreements of the parties contained in this
Agreement shall be binding upon and inure to the benefit of their respective
successors and permitted assigns.
(i) Specific Performance. The parties hereto agree that the
securities of the Corporation cannot be purchased or sold in the open market and
that, for these reasons, among others, the parties will be irreparably damaged
in the event that this Agreement is not specifically enforceable. Accordingly,
in the event of any controversy concerning the securities which are the subject
of this Agreement, or any right or obligation to register the securities, such
right or obligation shall be enforceable in a court of equity by specific
performance. The rights granted in this Section 10(i) shall be cumulative and
not exclusive, and shall be in addition to any and all other rights which the
parties to this Agreement may have under this Agreement, at law or in equity.
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(i) Entire Agreement. This Agreement, the Contribution Agreement,
and the other agreements delivered in connection with the Contribution
Agreement, collectively contain the entire understanding of the parties, and
there are no further or other agreements or understandings, written or oral, in
effect between the parties relating to the subject matter of this Agreement
unless expressly referred to in this Agreement.
(k) Agreement to Perform Required Acts. Each party to this Agreement
agrees to perform any further acts and to execute and deliver any further
documents that may be reasonably necessary to carry out the provisions of this
Agreement, that may be required to secure performance of any party's duties
under this Agreement or that may be required to assure the legal and binding
effect of the provisions of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first above written.
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By:
------------------------
Dr. Ramendra P. Singh
Its: President
STOCKHOLDERS:
-----------------------------
Michael Burns
-----------------------------
William Dallas
-----------------------------
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By:
-------------------------------
Its:
-------------------------------
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EXHIBIT D
to
CONTRIBUTION AND EXCHANGE AGREEMENT
Dated as of August 12, 1999
FORM OF EXCHANGE AGREEMENT
EXCHANGE AGREEMENT
THIS EXCHANGE AGREEMENT (this "Agreement"), is made and entered into as of
_______________, 1999, by and among DYNACS ENGINEERING COMPANY, INC., a Florida
corporation (the "Company"), RAMENDRAP. SINGH, an existing stockholder of the
Company (the "Existing Stockholder"), MICHAEL BURNS ("Burns"), WILLIAM DALLAS
("Dallas"), JON FELTHEIMER ("Feltheimer") and OFFENSE GROUP ASSOCIATES, LP
("OGA") (Burns, Dallas, Feltheimer and OGA are sometimes collectively referred
to in this Agreement as the "Investors" and each as an "Investor").
RECITALS
A. The Company and the Investors are parties to that certain Contribution
and Exchange Agreement, dated as of August 12, 1999 (the "Contribution
Agreement"), which agreement provides for, among other things, the issuance by
Cerulean FXs, Inc., a Florida corporation ("FX") of 80,000 shares of its common
stock, par value $0.01 per share (the "FX Common Stock") to the Company and the
issuance of an aggregate of 20,000 shares of FX Common Stock to the Investors in
exchange for the contribution by the Company and each of the Investors of
certain securities owned by them.
B. In connection with the Contribution Agreement, the Company and the
Investors have agreed to provide for the exchange of their shares of FX Common
Stock for shares of common stock, par value $.001 per share, of the Company (the
"Company Common Stock") upon the occurrence of certain events, all as set forth
in this Agreement. The execution and delivery of this Agreement by each of the
parties to this Agreement are conditions precedent to the closing of the
Contribution Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of foregoing premises and of the mutual
covenants and agreements contained in this Agreement, on the terms and subject
to the conditions set forth in this Agreement, the parties to this Agreement
agree as follows:
1. Definitions. Capitalized terms used in this Agreement and not defined
in this Agreement shall have the meanings given those terms in the Contribution
Agreement. Otherwise, the following terms have the following meanings, unless
the context otherwise requires:
"Affiliate" means, with respect to a specified Person, any Person
that directly or indirectly through one or more intermediaries controls or is
controlled by, or is under common control with, the specified Person.
"Commission" means the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
"Exchange" means the issuance of the Exchange Shares in exchange for
all of the FX Shares as provided in this Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Shares" means the shares of Company Common Stock to be
issued to the Holders at the closing of the Exchange.
"Family Member" means, with respect to any Person, any descendant of
the grandfather of the Person, the Person's spouse or any descendant of the
grandfather of the Person's spouse.
"Holder" or "Holders" means, prior to the Exchange, any holder of
record of the FX Shares and, following the Exchange, any holder of record of the
Exchange Shares.
"Liquidation Event" means the occurrence of any of the following:
(i) the Company voluntarily or involuntarily dissolves, liquidates or winds up
its affairs; (ii) the Company becomes insolvent or makes a general assignment
for the benefit of creditors; (iii) a petition in bankruptcy is filed by the
Company or against the Company and not opposed by the Company; (iv) the Company
is adjudicated a bankrupt or insolvent; (v) a bill in equity or other proceeding
for the appointment of a receiver of the Company or other custodian for the
Company's business or assets is filed and consented to by the Company; (vi) a
receiver or other custodian (permanent or temporary) of the Company's assets or
property, or any part thereof, is appointed by any court of competent
jurisdiction; or (vii) proceedings for a composition with creditors under any
state or federal law is instituted by or against the Company.
"Member Representative" shall have the meaning given such term in
Section 2.2 of the Contribution Agreement.
"FX Shares" shall consist of the shares of FX Common Stock acquired
by the Investors pursuant to the Contribution Agreement, and any securities
issued by FX with respect to those shares by way of dividend or stock split or
similar transaction, and any securities issued by FX or a successor to FX with
respect to those shares in connection with any recapitalization, merger,
consolidation or other reorganization.
"Optional Exchange Event" means the occurrence of any of (i) a
Qualified Private Placement, (ii) the second anniversary of the date of this
Agreement, (iii) a Sale of Voting Control or (iv) a Liquidation Event.
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"Person" means any individual, corporation, partnership, firm, joint
venture, association, joint-stock company, trust, incorporated organization or
other entity.
"pro rata" means, with respect to any determination, that the
determination is based on the relative percentages of shares of Company Common
Stock then held by all of the stockholders of the Company after giving pro forma
effect to the issuance by the Company, and the ownership by the Holders, of all
of the Exchange Shares at the time the determination is made, as if all of the
Exchange Shares had been then issued.
"Qualified Private Placement" means the closing of a sale by the
Company of any debt and/or equity securities of the Company that (i) does not
constitute a Qualified Public Offering and (ii) raises gross proceeds (proceeds
before discounts, commissions and offering expenses) of at least $5 million.
"Qualified Public Offering" means the closing of (i) an underwritten
public offering of Company Common Stock pursuant to an effective Registration
Statement, or (ii) the merger of the Company with and into another entity
pursuant to which the shareholders of the Company immediately prior to the
effective date of the merger receive, upon consummation of the merger, shares of
voting securities of the surviving entity or its parent that are registered
under the Exchange Act and trade on the New York Stock Exchange, the American
Stock Exchange, the Nasdaq National Market or the Nasdaq Small Cap Market.
"Registration Statement" means a registration statement under the
Securities Act.
"Sale of Voting Control" means any transfer, or series of related
transfers, of shares of Company Common Stock to any Person who, in the aggregate
with all Family Members and Affiliates of such Person, and any other Persons who
are part of a syndicate or group (as defined in Section 13(d)(3) of the Exchange
Act) with such Person, would (after giving effect to the transfer but
disregarding any shares of Company Common Stock held by the Person, his or her
Family Members and Affiliates, and syndicate or group prior to the transfer or
series of related transfers) own shares of Company Common Stock constituting
more than 50% of the voting power of the then issued and outstanding shares of
Company Common Stock (after giving pro forma effect to the issuance by the
Company, and the ownership by the Holders, of all of the Exchange Shares at the
time the determination is made, as if all of the Exchange Shares had been then
issued).
"Securities Act" means the Securities Act of 1933, as amended.
"transfer" means any direct or indirect sale, assignment, transfer,
pledge, hypothecation, gift, encumbrance or other disposition of securities.
2. Exchange.
(a) Optional Exchange by the Holders. Each of the FX Shares may be
exchanged, together with all other FX Shares and not in part, at the option of
the Member Representative at any time on the date of or subsequent to an
Optional Exchange Event, for that number of fully paid and non-assessable shares
of Company Common Stock determined in accordance with the provisions of
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Section 4 of this Agreement. If the Member Representative desires to exchange
the FX Shares for Company Common Stock pursuant to this Section 2(a), the Member
Representative shall give written notice to the Company pursuant to the
provisions of Section 3 below. The closing of the Exchange will take place at
the time and place and in the manner set forth in Section 5 below.
Notwithstanding the later closing of the Exchange, the effective date of the
Exchange will be the date notice is first given by the Member Representative to
the Company in accordance with Section 3 below, and the Holders entitled to
receive the Exchange Shares issuable upon the Exchange will be treated for all
purposes as the record holders of the Exchange Shares on that date.
(b) Optional Exchange by the Company. Each of the FX Shares may be
exchanged, together with all other FX Shares and not in part, at the option of
the Company at any time on or subsequent to the fifth anniversary of the date of
this Agreement, for that number of fully paid and non-assessable shares of
Company Common Stock determined in accordance with the provisions of Section 4
of this Agreement. If the Company desires to exchange Company Common Stock for
the FX Shares pursuant to this Section 2(b), the Company shall give written
notice to the Member Representative pursuant to the provisions of Section 3
below. The closing of the Exchange will take place at the time and place and in
the manner set forth in Section 5 below. Notwithstanding the later closing of
the Exchange, the effective date of the Exchange will be the date notice is
first given by the Company to the Member Representative in accordance with
Section 3 below, and the Holders entitled to receive the Exchange Shares
issuable upon the Exchange will be treated for all purposes as the record
holders of the Exchange Shares on that date.
(c) Automatic Exchange. Each of the FX Shares then outstanding will
be automatically exchanged, without election or further action by the Company or
the holders of the FX Shares, for the number of fully paid and non-assessable
shares of Company Common Stock determined in accordance with the provisions of
Section 4 of this Agreement, upon the effective date of a Registration Statement
filed by the Company with the Commission in connection with a Qualified Public
Offering. The Company shall give notice of the Exchange under this Section 2(c)
to the Member Representative in accordance with Section 3 below. The closing of
the Exchange will take place at the time and place and in the manner set forth
in Section 5 below. Notwithstanding the later closing of the Exchange, the
effective date of the Exchange will be the date the Registration Statement for
the Qualified Public Offering is declared effective by the Commission, and the
Holders entitled to receive the Exchange Shares issuable upon the Exchange will
be treated for all purposes as the record holders of the Exchange Shares on that
date.
(d) Fractional Shares. No fractional shares of Company Common Stock
will be issued upon the exchange of the FX Shares. If any fractional shares of
Company Common Stock would, except for the provisions of this Section 2(d), be
deliverable upon the exchange of any FX Shares the Company will, in lieu of
delivering the fractional share therefor, adjust the fractional interest by
rounding up the number of Exchange Shares to be issued to the Holder to the
nearest whole share.
(e) Reservation of Stock. The Company will at all times reserve and
keep available out of its authorized but unissued shares of Company Common
Stock, solely for the purpose of effecting the Exchange, the number of shares of
Company Common Stock as shall from time to time be sufficient to effect the
Exchange, and if at any time the number of authorized but unissued
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shares of Company Common Stock shall not be sufficient to effect the Exchange,
the Company will promptly seek what corporate action may, in the opinion of its
counsel, be necessary to increase its authorized but unissued shares of Company
Common Stock to the number of shares as shall be sufficient for the purpose of
effecting the Exchange. In the event of the consolidation or merger of the
Company with another corporation where the Company is not the surviving
corporation, provision shall be made in the documents of merger or
consolidation, or otherwise, of the surviving corporation so that the surviving
corporation will at all times reserve and keep available a sufficient number of
shares of common stock or other securities or property to provide for the
exchange of the FX Shares in accordance with the provisions of this Section 2.
(f) Payment of Costs and Taxes. The Company shall pay all costs and
expenses of the Exchange, including all taxes, fees and other governmental
charges (other than any income or other taxes imposed upon the profits realized
by the recipient) that may be imposed in respect of the issue or delivery of the
Exchange Shares or other securities or property upon the Exchange, including,
without limitation, any tax or other charge imposed in connection with any
transfer involved in the issue and delivery of Exchange Shares or other
securities in a name other than that in which the FX Shares so exchanged were
registered.
3. Exchange Notice. Notice of the Exchange (the "Exchange Notice") shall
be provided by the Company or the Member Representative as set forth in this
Section 3.
(a) The Member Representative shall elect to consummate the Exchange
pursuant to Section 2(a) of this Agreement by giving the Company written notice
of the election. The notice shall specify the names in which the Holders desire
the certificates for their respective Exchange Shares to be issued.
(b) The Company shall elect to consummate the Exchange pursuant to
Section 2(b) of this Agreement by giving the Member Representative written
notice of the election. Following receipt by the Member Representative of the
notice and prior to the closing of the Exchange, the Member Representative will
provide notice to the Company specifying the names in which the Holders desire
the certificates for their respective Exchange Shares to be issued.
(c) The Company shall provide notice to the Member Representative of
a proposed Qualified Public Offering at least 30 days prior to the date the
Registration Statement for the Qualified Public Offering is first filed by the
Company with the Commission. The notice shall set forth the anticipated
effective date of the Registration Statement. Following receipt by the Member
Representative of the notice and prior to the closing of the Exchange, the
Member Representative will provide notice to the Company specifying the names in
which the Holders desire the certificates for their respective Exchange Shares
to be issued.
4. Exchange Rate.
(a) Initial Exchange Rate. Each of the FX Shares shall be
exchangeable into that number of fully paid and non-assessable shares of Company
Common Stock as is determined by dividing 31.2375 by the "Exchange Rate" (as
defined below) in effect at the time of the exchange.
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The exchange rate (the "Exchange Rate") initially will be 1. The initial
Exchange Rate will be subject to adjustment from time to time in certain
instances, as provided in Section 4(b) below.
(b) Adjustment to Exchange Rate. The Exchange Rate will be subject
to adjustment from time to time as provided in this Section 4(b).
(i) Adjustment for Stock Splits and Stock Dividends. If at any
time or from time to time the outstanding shares of Company Common Stock shall
be subdivided into a greater number of shares, or a dividend in Company Common
Stock or other securities of the Company convertible into or exchangeable for
Company Common Stock(in which latter event the number of shares of Company
Common Stock issuable upon the conversion or exchange of such securities shall
be deemed to have been distributed) shall be paid in respect to the Company
Common Stock, the Exchange Rate in effect immediately prior to the subdivision
or at the record date of the dividend will, simultaneously with the
effectiveness of the subdivision or immediately after the record date of the
dividend, be proportionately reduced, and conversely, if the outstanding shares
of Company Common Stock shall be combined into a smaller number of shares, the
Exchange Rate in effect immediately prior to the combination will,
simultaneously with the effectiveness of the combination, be proportionately
increased. Any adjustment to the Exchange Rate under this Section 4(b)(i) will
become effective at the close of business on the date the subdivision or
combination referred to in this Section 4(b)(i) becomes effective.
(ii) Adjustment for Recapitalizations and Reorganizations. If
at any time or from time to time there shall be a recapitalization of the
Company Common Stock (other than a subdivision or combination provided for in
Section 4(b)(i) above) or a merger, consolidation or reorganization of the
Company, provision shall be made in the transaction so that the Holders will
thereafter be entitled to receive, upon the Exchange, the number of shares of
stock or other securities or property of the Company or otherwise, to which a
holder of that number of shares of Company Common Stock, deliverable upon
exchange of the FX Shares, immediately prior to the transaction, would have been
entitled in connection with the transaction. In any such case, appropriate
adjustment will be made in the application of the provisions of this Section
4(b), with respect to the rights of the Holders after the transaction, to the
end that the provisions of this Section 4(b) (including adjustment of the
Exchange Rate then in effect and the number of shares issuable upon the
Exchange) shall be applicable after that event as nearly equivalent as is
possible, using reasonable efforts.
(c) Notice of Adjustments. In each case of an adjustment or
readjustment of the Exchange Rate or the number of shares of Company Common
Stock or other securities issuable upon the Exchange, if the adjustment or
readjustment results in a change of more than 1% from the previous rate or
number of shares, the Company, or independent public accountants selected by the
Company, shall compute the adjustment or readjustment in accordance with this
Agreement and prepare a certificate showing the adjustment or readjustment, and
the Company will deliver the certificate to each Holder. The certificate will
set forth the adjustment or readjustment, showing in detail the facts upon which
the adjustment or readjustment is based, including a statement of (i) the
capital stock of the Company then outstanding, (ii) the Exchange Rate then in
effect and (ii) the number of shares of Company Common Stock and the type and
amount, if any, of other property which at the time would be received upon
exchange of the FX Shares.
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(d) Disputes as to Calculation of Exchange Rate. In the event of a
disagreement between the parties regarding the Exchange Rate, (i) each of the
Member Representative and the Company will retain independent public accountants
to determine the rate, and within 30 days thereafter, will deliver to the other
the written report of its accountants calculating the rate; (ii) if the higher
rate is less than 10% above the lower rate, the average will be the Exchange
Rate; (iii) if the rates exceed this 10% difference, the Member Representative
and the Company will instruct their accountants to forthwith select a third
reputable accounting firm to determine the Exchange Rate, and (x) if the third
accounting firm's rate is between the rates of the other accountants, the third
accounting firm's rate will be the Exchange Rate, or (y) if the third accounting
firm's rate is outside the range of the other accountants' rates, the other
accountants will continue to select new third accounting firms, until a third
accounting firm so selected provides a rate which is between the first two
rates, and this rate will be the Exchange Rate. In connection with these
valuations, the Company will, on a confidential basis, deliver or provide access
to each accounting firm of all information reasonably requested by the
accounting firm in order to determine the Exchange Rate. The entire cost of all
valuations performed under this Section 4(d) shall be borne by the Company.
(e) Notice of Events Pertinent to Exchange Rights. If (i) the
Company shall set a record date for the purpose of entitling the holders of
Company Common Stock to receive a dividend in Company Common Stock, or any other
distribution of property or securities of the Company; or (ii) the Company shall
set a record date for the purpose of entitling the holders of Company Common
Stock, as a class, to subscribe for or purchase any shares of any class or
securities convertible into or exchangeable for shares of any class, or any
option, right or warrant, to subscribe for any of the foregoing; or (iii) there
is a merger or consolidation of the Company with or into another corporation or
corporations; or (iv) there is a reorganization of the Company (including any
exchange reorganization or sale-of-assets reorganization) or a recapitalization
or reclassification of the capital stock of the Company; or (v) there is a
voluntary or involuntary dissolution, liquidation, or winding up of the Company;
then, and in any such case, the Company will cause to be mailed to the Holders,
at least 30 days prior to the date specified below, a notice stating the date
(x) that has been set as the record date for the purpose of a dividend,
distribution, or rights subscription as described in clauses (i) and (ii) of
this subsection 4(e), or (y) on which the merger or consolidation,
reorganization, liquidation, dissolution or winding up described in clauses
(iii) through (v) of this subsection 4(e) is to take place.
5. Closing of Exchange. The closing of the Exchange will take place at the
time and place as the Member Representative and the Company shall mutually agree
upon; provided, that the date of closing will be within 10 days following the
effective date of the Exchange as determined pursuant to Section 2 of this
Agreement. At the closing, each of the Holders will deliver to the Company
documents of transfer in form and substance reasonably acceptable to the Company
and its counsel, necessary to vest in the Company good and marketable title to
the FX Shares so exchanged by the Holder, free and clear of any and all liens
and rights of third parties, other than those imposed under or pursuant to this
Agreement, the Contribution Agreement, against delivery by the Company to the
Holders of certificates representing the Exchange Shares in the names and
denominations specified by the Holders prior to the closing.
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6. Preemptive Rights.
(a) Grant of Rights. Until a Qualified Public Offering, and except
as provided in this Section 6, the Holders shall have the right to purchase,
during the period or periods, at the prices and on the other terms and
conditions fixed by the Board of Directors of the Company, any shares of Company
Common Stock, and any options or warrants or other instruments or securities
exchangeable for or convertible into shares of Company Common Stock or
evidencing any right to subscribe for, purchase or otherwise acquire shares of
Company Common Stock, which may be issued from time to time by the Company.
(b) Pro-Rata Purchase. Each of the Holders shall have the right to
purchase his or its pro rata portion of the securities subject to this Section
6. After giving notice of any proposed issuance of securities subject to this
Section 6 and affording each Holder the opportunity to purchase his or its pro
rata share of the securities during a period of not less than 15 days after the
date notice is first given to the Holder, the Company may thereafter sell any of
the pro rata share of the securities that are not purchased by the Holders
without further offering them to the Holders. Failure by a Holder to purchase
his or its pro rata share of securities by exercise of a preemptive right on one
occasion shall not constitute a waiver of such right with respect to future
offerings by the Company.
(c) Limitations on Preemptive Rights. Notwithstanding the foregoing,
the Company may issue shares of Company Common Stock, or any options or warrants
or other instruments or securities exchangeable for or convertible into shares
of Company Common Stock or evidencing any right to subscribe for, purchase or
otherwise acquire shares of Company Common Stock, without first offering the
same to the Holders in the following circumstances: (i) in exchange for capital
stock of the Company; (ii) to fulfill or comply with any obligation of the
Company to issue shares of Company Common Stock pursuant to any present or
future stock option plan, stock purchase, bonus, savings investment, or other
stock incentive programs for the benefit of the directors, officers, employees
of or consultants to the Company; provided, that the maximum number of shares
that may be issued pursuant to any of the foregoing in any five year period does
not exceed 15% of the total shares of Company Common Stock outstanding
immediately following the closing of the Contribution Agreement (subject to
adjustment to prevent dilution); and provided, further, that the per share
exercise or purchase price under any of the foregoing was determined by the
Company's Board of Directors to be at least 85% of the fair market value of a
share of Company Common Stock at the time of grant of the stock purchase right,
stock option or other stock incentive; (iii) in connection with a Qualified
Public Offering; (iv) in connection with a merger, consolidation or
reorganization of the Company with a Person or Persons who are not Affiliates of
the Company; (v) in connection with any acquisition of the assets of or an
equity interest in any business entity which is, or is owned by, a Person not an
Affiliate of the Company, the Investors or the Existing Stockholder; or (vi) in
connection with any other transaction approved in writing by the Member
Representative.
7. Put Option.
(a) Option. If a Qualified Public Offering has not occurred prior to
the fifth anniversary of the date of this Agreement (the "Option Trigger
Date"), the Member Representative shall have the right and option (the "Put
Option") at any time following the Exchange, to require the
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<PAGE> 98
Company to purchase for the "Put Option Price" (as defined below) up to an
aggregate number of Exchange Shares owned by the Holders (the shares subject to
the Put Option are referred to in this Agreement as the "Option Shares") equal
to (i) $900,000 divided by (ii) the per share value (the "Per Share Value")
determined pursuant to Section 7(c) below, by delivering written notice of
election to exercise the Put Option to the Company. The effective date of the
Put Option shall be the date the exercise notice is given by the Member
Representative to the Company. The portion of the Option Shares to be purchased
from each Holder shall be based on the relative percentages of Exchange Shares
then held by all of the Holders on the effective date of the Put Option.
(b) Put Option Price. The "Put Option Price" for the Option Shares
shall mean an amount equal to the sum of (i) $900,000 plus (ii) an additional
amount necessary for the Holders to realize, on an after-tax (state and Federal)
basis (calculated at the then-highest marginal tax rates, but assuming a Federal
deduction for state taxes paid), and including any and all taxes (at the same
marginal rates) payable on the additional amounts paid pursuant to this
subsection (ii), an amount equal to the after-tax amount (similarly calculated)
which the Holders would have realized had the payment of the $900,000 amount
been treated, for all tax purposes, as a long-term (and if there is then more
than one long-term rate, the rate applicable to assets held for at least seven
years at the time of sale) capital gain.
(c) Per Share Value.
(i) Calculation of Per Share Value. The Per Share Value for
purposes of calculating the number of Option Shares under the Put Option shall
be an amount equal to the "Fair Market Value" (as defined below) of the Company
on the effective date of the Put Option, divided by the number of shares of
Company Common Stock issued and outstanding on the effective date of the Put
Option (and if there is more than one class of common stock of the Company then
outstanding, the denominator shall be adjusted to include on an equitable basis
all then outstanding shares of all classes of common stock). For purposes of
Section 7(b), "Fair Market Value" means the value determined on the basis of the
businesses, properties, historical financial performance and financial
condition, projections and prospects for the further growth of the Company,
including its Subsidiaries and other consolidated or owned operations,
considered as a single entity. The parties will use reasonable efforts to reach
agreement on the Fair Market Value. In the event of a disagreement between the
parties regarding the Fair Market Value, (i) each of the Member Representative
and the Company will retain a reputable investment bank to determine the value,
and within 30 days thereafter, will deliver to the other the written report of
its investment bank as to the value; (ii) if the higher valuation is less than
10% above the lower valuation, the average will be the Fair Market Value; (iii)
if the valuations exceed this 10% difference, the Member Representative and the
Company will instruct their investment banks to forthwith select a third
reputable investment bank, and (x) if the third investment bank's valuation is
between the valuations of the other banks, the third investment bank's valuation
will be the Fair Market Value, or (y) if the third investment bank's valuation
is outside the range of the other banks, the average of the two investment
banks' valuations that are closest together will be the Fair Market Value unless
the middle valuation is equally different from the high and low valuations, in
which case the middle valuation will be the Fair Market Value. In connection
with these valuations, the Company will, on a confidential basis, deliver or
provide access to each investment bank of all information reasonably requested
by the investment
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<PAGE> 99
bank in order to determine the Fair Market Value. The entire cost of all
appraisals performed under this Section 7(c)(i) shall be borne by the Company.
(ii) Payment of Put Option Price. The Put Option Price for the
Option Shares under the Put Option shall be paid, at the election of the Member
Representative, by either (x) bank cashiers' checks in immediately available
funds payable to the order of the selling holders, or (y) wire transfer of
immediately available funds to an account or accounts designated by the Member
Representative. Notwithstanding the foregoing, if the funds of the Company
legally available to be paid for redemption of the Option Shares under
applicable corporate law are insufficient to redeem all of the Option Shares,
those funds which are legally available will be used to redeem the maximum
possible number of Option Shares ratably among the Holders based upon the number
of Option Shares held by each Holder, and the remaining Option Shares will be
redeemed from the Holders by payment of a secured promissory note to each Holder
with a principal amount equal to the balance of the purchase price for the
Holder's Option Shares (each a "Note" and collectively, the "Notes"). Each Note
(a) will bear interest at an annual rate equal to the lesser of (x) the highest
interest rate permissible by law and (y) the rate announced from time to time by
Bank America NT&SA as its reference rate plus 2%, adjusting quarterly, (b) shall
provide for interest only to be payable quarterly and principal to be payable as
provided below, (c) shall be secured by the number of Option Shares paid for
using the Note, and (d) shall have a term of 2 years.
On the last day of each calendar quarter following the closing
of the purchase and sale of the Option Shares (each, a "Payment Date"), the
Company will determine the cash amount legally available to the Company on the
Payment Date that may be used to redeem shares of the Company's capital stock,
and the Company will apply that amount toward repayment of the Notes, which
payment will be applied ratably among the Holders based upon the number of
Option Shares underlying the Notes held by the Holders on the Payment Date.
(d) Put Option Closing. The closing of the purchase and sale of the
Option Shares pursuant to this Section 7 will take place at the time and place
as the Member Representative and the Company shall mutually agree upon;
provided, that the date of closing will be within 30 days following the date of
final determination of the Fair Market Value. At the closing, each of the
Holders of the Option Shares will deliver to the Company documents of transfer
in form and substance reasonably acceptable to the Company and its counsel,
necessary to vest in the Company good and marketable title to the Option Shares
so sold by the Holder, free and clear of any and all liens and rights of third
parties, other than those imposed under or pursuant to this Agreement, the
Contribution Agreement or any other agreement delivered in connection with this
Agreement or the Contribution Agreement, against delivery by the Company to the
Holders of the Option Shares of the Put Option Price for the Option Shares,
payable in the manner set forth in Section 7(c)(ii) above.
(e) Right of Set Off. In addition to, and without limiting any other
rights the Company may have under that certain Non-Recourse Secured Promissory
Note, dated as of the date of this Agreement, in the principal amount of up to
$600,000 delivered by Burns to the Company (the "Promissory Note"), Burns hereby
grants to the Company a right to set off and apply any payments of the Put
Option Price required to be made by the Company to Burns under this Section 7
against any amounts due (and not paid when due) by Burns to the Company under
the Promissory Note,
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without presentment, demand, protest or other notice of any kind, all of which
Burns hereby expressly waives.
S. FX Stock. Until the Exchange, other than (i) as contemplated by this
Agreement or the Contribution Agreement, or (ii) as consented to in writing by
the Member Representative, the Company will not, and the Existing Stockholder
will not permit or cause the Company to, (x) sell, transfer or otherwise dispose
of any shares of capital stock of FX owned by the Company on the date of this
Agreement, or cause or permit FX to issue, sell or otherwise dispose of, or
purchase, redeem or otherwise acquire any shares of capital stock of FX, or (y)
grant, or cause or permit FX to grant, any right (or the preemptive right) or
any option to subscribe for or purchase, or enter into, or cause or permit FX to
enter into, any agreement for the issuance (contingent or otherwise) of or
create, or cause or permit FX to create, any call, commitment, stock
appreciation right, claim or other right of any character relating to, any
shares of capital stock of FX.
9. Hold-Back Agreement.
(a) By Burns. Except as otherwise provided in Section 9(c) below,
and in addition to all other obligations of Burns regarding the transfer of
shares of Company Common Stock, Burns agrees that, without the prior written
consent of the Existing Stockholder, he will not, during the period commencing
on the date of this Agreement and ending on the fifth anniversary of the date of
this Agreement, transfer (i) any of a number of Exchange Shares equal to 30% of
the Exchange Shares received by Burns at the closing of the Exchange, (ii) any
securities issued by the Company with respect to those Exchange Shares by way of
dividend or stock split or similar transaction, and (iii) any securities issued
by the Company or a successor to the Company with respect to those Exchange
Shares in connection with any recapitalization, merger, consolidation or other
reorganization.
(b) By the Existing Stockholder. Except as otherwise provided in
Section 9(c) below, and in addition to all other obligations of the Existing
Stockholder regarding the transfer of shares of Company Common Stock, the
Existing Stockholder agrees that, without the prior written consent of Burns, he
will not, during the period commencing on the date of this Agreement and ending
on the fifth anniversary of the date of this Agreement, transfer (i) any of
866,250 shares of Company Common Stock, (ii) any securities issued by the
Company with respect to those shares of Company Common Stock by way of dividend
or stock split or similar transaction, and (iii) any securities issued by the
Company or a successor to the Company with respect to those shares of Company
Common Stock in connection with any recapitalization, merger, consolidation or
other reorganization.
(c) Transfers to Family Members or Trusts. Nothing in Sections 9(a)
and (b) shall require Burns or the Existing Stockholder to obtain the other's
consent to a transfer of all or a portion of his respective shares of Company
Common Stock subject to the restrictions on transfer set forth in Section 9(a)
or Section 9(b), by death or inter vivos, (i) to any of his Family Members, or
(ii) to any trust established solely for his benefit or for the benefit of one
or more of his Family Members, or to any legal entity in which he or any of
these Persons are the sole beneficial owners. Any shares transferred to the
executor of an estate, in the case of death, to any Family Member, or to any
trust or other legal entity described above in subsection (ii) of this Section
9(c), shall be subject
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to the provisions of this Section 9. No transfer of shares may be made to any of
the foregoing Persons pursuant to this Section 9(c) unless and until the Person
delivers to Burns or the Existing Stockholder, as the case may be, a signed
counterpart of this Agreement or a written acknowledgment that the shares to be
received in the proposed transfer are subject to Section 9 of this Agreement and
that the Person and his successors in interest are bound by this Section 9 and
agree to comply with its terms. Any attempted transfer of shares under this
Section 9(c) to any of the foregoing Persons other than in accordance with this
Section 9(c) shall be null and void and the Company will refuse to recognize the
transfer and not reflect in its records any change in record ownership of shares
pursuant to the transfer, and the Company will refuse to treat as owner of the
shares or to accord the right to vote as the owner or to pay dividends to any
transferee to whom the shares shall have been transferred.
10. Miscellaneous
(a) Notices. All notices, demands or other communications hereunder
shall be in writing and shall be deemed to have been duly given if delivered in
person, or by United States mail, certified or registered, return receipt
requested or otherwise actually delivered:
(i) if to any of the Investors or Holders or to the Existing
Stockholder, at the address set forth for each of these Persons on the
Company's books; and
(ii) if to the Company, at the address of the Company as set
forth in the Contribution Agreement, marked for attention as therein
indicated;
or such other address as may have been furnished by such Person in writing to
the other parties. Any such notice, demand or other communication shall be
deemed to have been given on the date actually delivered or as of the date
mailed, as the case may be.
(b) Severability and Governing Law. Should any Section or any part
of a Section within this Agreement be rendered void, invalid or unenforceable by
any court of law for any reason the invalidity or unenforceability shall not
void or render invalid or unenforceable any other Section or part of a Section
in this Agreement. This Agreement shall be governed and construed in accordance
with the laws of the State of California applicable to contracts made and to be
performed entirely within the State of California, without regard to principles
of conflicts of law.
(c) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
(d) No Adverse Construction. The rule that a contract is to be
construed against the party drafting the contract is hereby waived, and shall
have no applicability in construing this Agreement or the terms of this
Agreement.
(e) Captions and Section Headings. Section titles or captions
contained in this Agreement are inserted as a matter of convenience and for
reference purposes only, and in no way define, limit, extend or describe the
scope of this Agreement or the intent of any provision hereof
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(f) Amendments and Waivers. This Agreement may be amended, modified,
superseded, canceled, renewed or extended, and the terms and conditions hereof
may be waived, only by a written instrument signed by all the parties to this
Agreement or, in the case of a waiver, by the party or parties, as the case may
be, waiving compliance. No delay on the part of any party in exercising any
right, power or privilege under this Agreement shall operate as a waiver
thereof, nor shall any waiver on the part of any party of any right, power or
privilege under this Agreement, nor any single or partial exercise of any right,
power or privilege under this Agreement, preclude any other or further exercise
thereof or the exercise of any other right, power or privilege under this
Agreement.
(g) Costs and Attorneys' Fees. In the event that any action, suit or
other proceeding is instituted concerning or arising out of this Agreement, the
prevailing party shall be entitled to recover all of the prevailing party's
costs and reasonable attorneys' fees incurred in each and every such action,
suit, or other proceedings, including any and all appeals or petitions
therefrom.
(h) Successors and Assigns. Except as otherwise provided in this
Agreement, all rights, covenants and agreements of the parties contained in this
Agreement shall be binding upon and inure to the benefit of their respective
successors and permitted assigns.
(i) Specific Performance. The parties hereto agree that the
securities of FX and the Company cannot be purchased or sold in the open market
and that, for these reasons, among others, the parties will be irreparably
damaged in the event that this Agreement is not specifically enforceable.
Accordingly, in the event of any controversy concerning the securities which are
the subject of this Agreement, or any right or obligation to with respect to
such securities, such right or obligation shall be enforceable in a court of
equity by specific performance. The rights granted in this Section 8(i) shall be
cumulative and not exclusive, and shall be in addition to any and all other
rights which the parties to this Agreement may have under this Agreement, at law
or in equity.
(j) Entire Agreement. This Agreement, the Contribution Agreement,
and the other agreements delivered in connection with this Agreement and the
Contribution Agreement, collectively contain the entire understanding of the
parties, and there are no further or other agreements or understandings, written
or oral, in effect between the parties relating to the subject matter of this
Agreement unless expressly referred to in this Agreement.
(k) Agreement to Perform Required Acts. Each party to this Agreement
agrees to perform any further acts and to execute and deliver any further
documents that may be reasonably necessary to carry out the provisions of this
Agreement, that may be required to secure performance of any party's duties
under this Agreement or that may be required to assure the legal and binding
effect of the provisions of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement as of the date first above written.
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By:
------------------------
Dr. Ramendra P. Singh
Its: President
-----------------------------
Dr. Ramendra P. Singh
INVESTORS:
-----------------------------
Michael Burns
-----------------------------
William Dallas
-----------------------------
Jon Feltheimer
OFFENSE GROUP ASSOCIATES, LP
By: Kaim NT, LP
Its: General Partner
By:
-------------------------------
Its:
-------------------------------
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EXHIBIT E
to
CONTRIBUTION AND EXCHANGE AGREEMENT
Dated as of August 12, 1999
FORM OF FIRST REFUSAL AGREEMENT
RIGHT OF FIRST REFUSAL AGREEMENT
THIS RIGHT OF FIRST REFUSAL AGREEMENT (this "Agreement"), is made and
entered into as of ___________, 1999, by and between DYNACS ENGINEERING COMPANY,
INC., a Florida corporation ("Dynacs"), and MICHAEL R. BURNS ("Burns").
RECITALS
A. Dynacs, Cerulean FXs, Inc., a Florida corporation ("FX"), and the
members (the "Members") of Cerulean Colorization, L.L.C., a Delaware limited
liability company ("Cerulean"), are parties to that certain Contribution and
Exchange Agreement, dated as of August 12, 1999 (the "Contribution Agreement"),
which agreement provides for, among other things, the issuance by FX of 80,000
shares of its common stock, par value $0.01 per share (the "FX Common Stock") to
Dynacs in exchange for the contribution by Dynacs of securities of Dynacs
Digital Services, Inc., a Delaware corporation, and the issuance of an aggregate
of 20,000 shares of FX Common Stock to the Members in exchange for the
contribution by each of the Members of their membership interests in Cerulean.
B. The assets of Cerulean include, in part, those assets identified on
Schedule A to this Agreement (the "Subject Assets").
C. To induce Burns to enter into the Contribution Agreement, Dynacs
desires to grant to Burns a right of first refusal to purchase the Subject
Assets in accordance with the terms set forth below. The execution and delivery
of this Agreement by each of the parties to this Agreement are conditions
precedent to the closing of the transactions contemplated by the Contribution
Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of foregoing premises and of the mutual
covenants and agreements contained in this Agreement, on the terms and subject
to the conditions set forth in this Agreement, the parties to this Agreement
agree as follows:
1. Definitions The following terms have the following meanings, unless the
context otherwise requires:
<PAGE> 105
"Dynacs Common Stock" means the Common Stock, par value $.001 per
share, of Dynacs.
"Exchange Agreement" means that certain Exchange Agreement, dated as
of the date hereof among Dynacs, Ramendra P. Singh and the Members.
"Fair Market Value of Dynacs" shall have the meaning given such term
in Section 7(c)(i) of the Exchange Agreement, and shall be determined in
accordance with and be subject to the terms of Section 7(c)(i) of the Exchange
Agreement.
"Person" means any individual, corporation, partnership, firm, joint
venture, association, joint-stock company, trust, incorporated organization or
other entity.
"Permitted Securities" means any Dynacs Common Stock or FX Common
Stock held by Burns or any of the Members.
"Qualified Public Offering" means the closing of (i) an underwritten
public offering of Dynacs Common Stock pursuant to an effective Registration
Statement, or (ii) the merger of Dynacs with and into another entity pursuant to
which the shareholders of Dynacs immediately prior to the effective date of the
merger receive, upon consummation of the merger, shares of voting securities of
the surviving entity or its parent that are registered under the Exchange Act
and trade on the New York Stock Exchange, the American Stock Exchange, the
Nasdaq National Market or the Nasdaq Small Cap Market.
"Qualified Sale of Dynacs" means the closing of (i) the sale of all
or substantially all of the assets of Dynacs, (ii) the transfer of 50% or more
of the outstanding voting stock of Dynacs, or (iii) the merger or reorganization
of Dynacs in which the equity holder(s) of Dynacs immediately prior to such
merger or reorganization control less than 50% of the equity or voting power of
the surviving entity after such merger or reorganization.
"Registration Statement" means a registration statement under the
Securities Act of 1933, as amended.
"Subsidiary" or "Subsidiaries" means, with respect to any Person,
any corporation or other business entity of which an aggregate of 50% or more of
the outstanding stock or other equity or ownership interest is, at the time,
directly or indirectly owned by the Person and/or one or more subsidiaries of
the Person.
"Transfer" means any sale, assignment, license, transfer or gift of
the Subject Assets, either directly or indirectly through (i) the transfer of
50% or more of the outstanding stock or other equity or ownership interest of a
Person that controls, directly or indirectly through one or more Subsidiaries,
any of the Subject Assets or (ii) the merger or reorganization of a Person that
controls, directly or indirectly through one or more Subsidiaries, any of the
Subject Assets in which the equity holder(s) of such Person immediately prior to
such merger or reorganization control less than 50% of the equity or voting
power of the surviving entity after such merger or reorganization; provided,
however, that a Qualified Sale of Dynacs shall not constitute a "Transfer"
hereunder.
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2. Right of First Refusal. Dynacs may Transfer, or cause or permit a
Subsidiary of Dynacs to Transfer, all or any part of the Subject Assets to any
Person that is not a Subsidiary of Dynacs (collectively, a "Transferee") only
after compliance with and in accordance with the provisions of this Section 2.
(a) Transfer Notice. If Dynacs or any Subsidiary of Dynacs proposes
to make a Transfer of all or any part of the Subject Assets, Dynacs shall
deliver a written notice of the proposed Transfer (the "Transfer Notice") to
Burns. The Transfer Notice shall contain a description of the proposed Transfer
and the terms of the proposed Transfer, including (i) a description of the
Subject Assets that are the subject of the proposed Transfer, (ii) a description
of the type of proposed Transfer, including whether the Transfer will be made
pursuant to a transfer of assets or equity interests, a license or a merger or
other reorganization, (iii) the name of the proposed Transferee, including,
specifically, the name of each person to whom or in favor of whom the proposed
Transfer is to be made, (iv) the price (in dollars or, if other than cash, as
determined pursuant to Subsection (d) of this Section 2) at which the Transfer
is proposed to be made to the Transferee (the "Offered Price"), (v) the terms of
payment of the Offered Price and the other terms and conditions to the proposed
Transfer to the Transferee (the "Offered Terms and Conditions"), (vi) any
written term sheet or offer letter with respect to the Transfer delivered by or
to the Transferee, and (vii) an offer (the "Offer") to Burns to make the
Transfer to Burns for a price (the "First Refusal Price") equal to 110% of the
Offered Price, which First Refusal Price may be paid in accordance with Section
2(c).
Burns acknowledges and agrees that if the Transfer is proposed to be
made in a transaction or series of related transactions in which the Subject
Assets comprise only a portion of the assets to be transferred, or in a
transaction in which the Transfer will be made indirectly through the transfer
of equity interests or pursuant to a merger or reorganization, Burns' right to
acquire the Subject Assets pursuant to this Agreement is conditional upon Burns
acquiring all, and not less than all, of the assets or equity interests that are
the subject of the transaction or series of related transactions (which assets
or equity interests are referred to herein as the "First Refusal Assets") for a
price equal to 110% of the Offered Price for such First Refusal Assets, which
price may be paid in accordance with Section 2(c).
(b) Acceptance. Burns shall have the right to accept the Offer by
written notice of acceptance (the "Acceptance Notice") from Burns to Dynacs
within 15 days of receipt of the Transfer Notice. The failure by Burns to
deliver an Acceptance Notice within 15 days of receipt of the Transfer Notice
shall result in the waiver by Burns of his rights set forth in this Section 2
only with respect to the Subject Assets set forth in the Transfer Notice and
only with respect to the specific Transfer described in the Transfer Notice, and
shall not act as a waiver of any future application of this Section 2 to any
other Subject Assets or the Subject Assets included in the Transfer Notice if
the proposed Transfer is not consummated as set forth in the Transfer Notice.
(c) Payment of the First Refusal Price. If Burns accepts the Offer
in accordance with this Agreement, the First Refusal Price may be paid (A) in
cash, (B) in Permitted Securities (the value of which shall be determined in
accordance with Section 2(e) below), or (C) in a combination of cash and
Permitted Securities.
3
<PAGE> 107
(d) Determination of the Offered Price. If any or all of the
consideration comprising the Offered Price consists of property other than cash,
the value of such property (the "Non-Cash Consideration") shall be its "fair
market value" as determined in accordance with this Section 2(d). If the
Non-Cash Consideration consists of securities listed for trading on a national
securities exchange or quoted on the National Association of Securities Dealers
Automated Quotation System ("Marketable Securities"), the fair market value of
such securities shall mean the average of the daily closing prices for the
twenty days preceding the Transfer Notice, or, if no closing price is available
for any such day or days, the average of the reported closing bid and ask prices
for the day or days with respect to which no closing price is available. If the
Non-Cash Consideration consists in part of property other than Marketable
Securities, the parties will use reasonable efforts to reach agreement on the
fair market value of such Non-Cash Consideration. If Burns and Dynacs do not
reach agreement as to the fair market value of the Non-Cash Consideration within
15 days following the delivery by Burns of the Acceptance Notice, the
determination of the fair market value of the Non-Cash Consideration shall be
made by arbitration. To institute arbitration proceedings, Burns shall appoint
an independent qualified appraiser, and notify Dynacs of its election. If Dynacs
does not deliver written notice of appointment of another independent qualified
appraiser within 10 days after receipt of the notice from Burns, Burns'
appraiser shall determine the fair market value of the Non-Cash Consideration.
If Dynacs delivers the notice, the two appraisers shall appoint a third
independent qualified appraiser who shall determine the fair market value of the
Non-Cash Consideration. The determination of the fair market value of the
Non-Cash Consideration completed in the manner provided in this Section 2(d)
shall be conclusive and binding upon the parties hereto. In no event, however,
shall the fair market value of the Non-Cash Consideration determined by the
arbitrator or arbitrators be outside of the range of estimates of the fair
market value of the Non-Cash Consideration submitted by Burns and Dynacs. The
cost of the appraisal shall be paid by the party whose estimate of the fair
market value of the Non-Cash Consideration most varies from the value determined
by the arbitrator (or if the parties' estimates vary equally, the cost of the
appraisal share be borne equally between them). In connection with these
valuations, Dynacs will, and will use its best efforts to cause the Transferee
to, on a confidential basis, deliver or provide access to the appraiser of all
information reasonably requested by the appraiser in order to determine the fair
market value of the Non-Cash Consideration.
(e) Valuation of Permitted Securities. If Burns elects to transfer
Permitted Securities to Dynacs as payment, in whole or in part, of the First
Refusal Price, the per share value of the Permitted Securities shall be an
amount equal to (i) the Fair Market Value of Dynacs on the date the Acceptance
Notice is received by Dynacs, divided by (ii) the number of shares of Dynacs
Common Stock issued and outstanding on such date (and if there is more than one
class of common stock of Dynacs then outstanding, the denominator shall be
adjusted to include on an equitable basis all then outstanding shares of all
classes of common stock); provided, that if any Permitted Securities to be
transferred as payment of the First Refusal Price consist, in whole or in part,
of shares of FX Common Stock, such shares of FX Common Stock shall be deemed to
have been converted into shares of Dynacs Common Stock pursuant to the terms of
the Exchange Agreement, and the per share value of the Permitted Securities
shall be calculated as if such shares of Dynacs Common Stock are outstanding on
the date the Acceptance Notice is received by Dynacs.
(f) Closing. The closing of the transfer of the First Refusal Assets
pursuant to this Section 2 will take place at the time and place as Burns and
Dynacs shall mutually agree upon;
4
<PAGE> 108
provided, that the date of closing will be within 30 days following the later
of (A) the delivery of the Acceptance Notice or (B) the date of final
determination of the First Refusal Price. At the closing, Dynacs will deliver or
cause to be delivered to Burns possession of and title to the First Refusal
Assets (or, if the proposed Transfer is to be made pursuant to a license, a
license to the First Refusal Assets on the same terms and conditions as set
forth in the Transfer Notice), and documents of transfer in form and substance
reasonably acceptable to Burns with respect thereto, and Burns will deliver to
Dynacs the First Refusal Price.
3. Term. This Agreement shall commence upon execution hereof, and shall
continue in full force and effect until the earlier of (i) a Qualified Public
Offering, (ii) a Qualified Sale of Dynacs or (ii) the fifth anniversary of the
date of this Agreement.
4. Miscellaneous
(a) Notices. All notices, demands or other communications hereunder
shall be in writing and shall be deemed to have been duly given if delivered in
person, or by United States mail, certified or registered, return receipt
requested or otherwise actually delivered:
(i) if to Dynacs, to:
Dynacs Engineering Company, Inc.
35111 U.S. Highway l9 North, Suite 300
Palm Harbor, Florida 34684
Attention: Dr. Ramendra P. Singh, President
Tel: (813) 787-1245
Fax: (813) 787-2503
with a copy to:
Frankfurt Garbus Klein & Selz
488 Madison Avenue, 9th Floor
New York, NY 10022
Attention: Gary A. Schonwald, Esq.
Tel: (212) 980-0120
Fax: (212) 593-9175
and
(ii) if to Burns, to:
Michael R. Burns
do Prudential Securities
2049 Century Park East, Suite 1200
Los Angeles, California 90067
Tel: (310) 996-2929
Fax: (310) 458-7595
5
<PAGE> 109
with a copy to:
Troop Steuber Pasich Reddick & Tobey, LLP
2029 Century Park East
Twenty-Fourth Floor
Los Angeles, CA 90067
Attention: Richard E. Troop, Esq.
Tel: (310) 728-3000
Fax: (310) 728-2200
or such other address as may have been furnished by such Person in writing to
the other parties. Any such notice, demand or other communication shall be
deemed to have been given on the date actually delivered or as of the date
mailed, as the case may be.
(b) Severability and Governing Law. Should any Section or any part
of a Section within this Agreement be rendered void, invalid or unenforceable by
any court of law for any reason, the invalidity or unenforceability shall not
void or render invalid or unenforceable any other Section or part of a Section
in this Agreement. This Agreement shall be governed and construed in accordance
with the laws of the State of California applicable to contracts made and to be
performed entirely within the State of California, without regard to principles
of conflicts of law.
(c) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
(d) No Adverse Construction. The rule that a contract is to be
construed against the party drafting the contract is hereby waived, and shall
have no applicability in construing this Agreement or the terms of this
Agreement.
(e) Captions and Section Headings. Section titles or captions
contained in this Agreement are inserted as a matter of convenience and for
reference purposes only, and in no way define, limit, extend or describe the
scope of this Agreement or the intent of any provision hereof
(f) Amendments and Waivers. This Agreement may be amended, modified,
superseded, canceled, renewed or extended, and the terms and conditions hereof
may be waived, only by a written instrument signed by all the parties to this
Agreement or, in the case of a waiver, by the party or parties, as the case may
be, waiving compliance. Except as otherwise set forth herein, no delay on the
part of any party in exercising any right, power or privilege under this
Agreement shall operate as a waiver thereof, nor shall any waiver on the part of
any party of any right, power or privilege under this Agreement, nor any single
or partial exercise of any right, power or privilege under this Agreement,
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege under this Agreement.
(g) Costs and Attorneys' Fees. In the event that any action, suit or
other proceeding is instituted concerning or arising out of this Agreement, the
prevailing party shall be
6
<PAGE> 110
entitled to recover all of the prevailing party's costs and reasonable
attorneys' fees incurred in each and every such action, suit, or other
proceedings, including any and all appeals or petitions therefrom.
(h) Successors and Assigns. Except as otherwise provided in this
Agreement, all rights, covenants and agreements of the parties contained in this
Agreement shall be binding upon and inure to the benefit of their respective
successors and permitted assigns.
(i) Specific Performance. The parties hereto agree that the Subject
Assets are unique, that an adequate remedy at law will not be available in the
event of a breach of this Agreement, and that the parties will be irreparably
damaged in the event that this Agreement is not specifically enforceable.
Accordingly, in the event of any controversy concerning the Subject Assets which
are the subject of this Agreement, or any right or obligation to with respect to
such Subject Assets, such right or obligation shall be enforceable in a court of
equity by specific performance. The rights granted in this Section 4(i) shall be
cumulative and not exclusive, and shall be in addition to any and all other
rights which the parties to this Agreement may have under this Agreement, at law
or in equity.
(j) Entire Agreement. This Agreement contains the entire
understanding of the parties, and there are no further or other agreements or
understandings, written or oral, in effect between the parties relating to the
subject matter of this Agreement unless expressly referred to in this Agreement.
(k) Agreement to Perform Required Acts. Each party to this Agreement
agrees to perform any further acts and to execute and deliver any further
documents that may be reasonably necessary to carry out the provisions of this
Agreement, that may be required to secure performance of any party's duties
under this Agreement or that may be required to assure the legal and binding
effect of the provisions of this Agreement.
7
<PAGE> 111
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement as of the date first above written.
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By:
------------------------------
Dr. Ramendra P. Singh
Its: President
-----------------------------------
Michael R. Burns
8
<PAGE> 112
SCHEDULE A
to
RIGHT OF FIRST REFUSAL AGREEMENT
Dated as of , 1999
SUBJECT ASSETS
A. Patents and Patent Applications
1. United States Patent Number 4,149,185, dated April 10, 1979:
Apparatus and Method For Animated Conversion of Black and White
Video to Color.
2. United States Patent Number 4,642,676, dated February 10, 1987:
Priority Masking Techniques for Video Special Effects.
3. Application for United States Patent, filed October 27, 1995:
Filtering in Picture Colorization, and any United States Patent
issued pursuant to such application.
4. Application for United States Patent, filed October 27, 1995: Region
Definition in Picture Colorization, and any United States Patent
issued pursuant to such application.
5. Application for United States Patent, filed September 1, 1995:
Picture Colonization, and any United States Patent issued pursuant
to such application.
6. Application for United States Patent, filed September 8, 1995:
Polygon Reshaping in Picture Colorization, and any United States
Patent issued pursuant to such application.
7. Canadian Patent Number 1,231,436, dated January 12, 1988: Priority
Masking Techniques for Video Special Effects.
8. Italian Patent Number 532,397, dated June 10, 1987: Classicolor
(trademark).
B. Copyrights
1. All copyrights in the C Track Colorization Software.
2. All copyrights in the Computoons Software (Ink & Paint Utilized for
Animation).
3. All copyrights in the colorized version of the film "Night of the
Living Dead."
4. All copyrights in the colorized version of the film clip of the
Hindenberg burning.
5. All copyrights in the colorized version of certain Midway war
footage.
6. All copyrights and other rights (including, without limitation,
rights to proceeds) in the colorized versions of episodes of the
Adventures of Rin Tin Tin.
7. All other copyrights owned by Cerulean Colorization L.L.C. upon
consummation of the transactions contemplated by the Contribution
Agreement.
SCHEDULE A
<PAGE> 113
EXHIBIT F
to
CONTRIBUTION AND EXCHANGE AGREEMENT
Dated as of August 12, 1999
FORM OF PROMISSORY NOTE
NON-RECOURSE SECURED PROMISSORY NOTE
$600,000.00 Los Angeles, California
__________________, 1999
IN CONSIDERATION of such advances ("Advances") as DYNACS ENGINEERING
COMPANY, INC., a Florida corporation (the "Company") from time to time may make
hereon to or for the benefit of MICHAEL BURNS ("Borrower") pursuant to the
Schedule annexed hereto up to a maximum aggregate amount of $600,000, Borrower
hereby promises to pay to the order of the Company or its assigns, on the
"Repayment Date" (as defined below), the principal amount of all Advances,
together with interest thereon from the date of such Advances, all on the terms
and conditions set forth below.
1. Contribution and Exchange Agreement. This Note is delivered pursuant to
the terms of Section 6.9 of that certain Contribution and Exchange Agreement,
dated as of August 12, 1999, among the Company, Cerulean FXs, Inc., a Florida
corporation ("FX"). Cerulean Colonization, L.L.C., a Delaware limited liability
company ("Cerulean"), Borrower and the other members of Cerulean whose names
appear on Exhibit A thereto (the "Agreement"), and represents the maximum amount
of loan advances to which Borrower is entitled under Section 6.9 of the
Agreement.
2. Interest. Interest on the unpaid principal amount of all Advances, and
on accrued and unpaid interest thereon, shall accrue annually from the date of
the Advance until the entire principal amount of the Advance is paid in full at
a rate equal to five and seven-tenths percent (5.7%) per annum.
a. Repayment Date. All outstanding and unpaid principal and interest on
this Note shall be due and payable on ___________ 2004 (the "Repayment Date").
All payments on this Note shall be made at such address as the holder of this
Note may from time to time advise Borrower in writing, in lawful money of the
United States of America.
4. Optional Prepayment. The Borrower may, at any time and from time to
time and without penalty, prepay all or any portion of the accrued and unpaid
interest on this Note and any outstanding principal amount of this Note. All
prepayments under this Note shall be credited first to accrued and unpaid
interest and second to the unpaid principal amount of this Note.
5. Security. As collateral security for the full and prompt payment when
due (whether by stated maturity, by acceleration or otherwise) of all amounts
payable under this Note, Borrower is creating and assigning to the Company, a
security interest in all of Borrower's right, title and interest in and to
12,381 shares of common stock, par value $0.01 per share, of FX owned by
<PAGE> 114
Borrower, pursuant to that certain Pledge and Security Agreement, dated the date
of this Note, between Borrower and the Company (the "Pledge Agreement"). This
Note is non-recourse to Borrower, and upon the occurrence of an Event of
Default, the Company's sole recourse and remedy shall be the exercise of the
rights and remedies with respect to the collateral granted the Company in the
Pledge Agreement.
6. Events of Default. If any one or more of the following events (each an
"Event of Default") shall occur:
(a) Borrower shall fail to make any required payment of principal of
or interest on this Note when due and payable (whether at stated maturity,
acceleration or otherwise), and such failure continues for a period of ten (10)
days after written notice thereof and demand for payment from the Company to
Borrower; or
(b) (i) any order, judgment or decree shall be entered under any
bankruptcy or similar law (the "Bankruptcy Law") of any jurisdiction
adjudicating Borrower bankrupt or insolvent, (ii) any proceeding, whether
voluntary or involuntary, shall be commenced by or against Borrower under any
Bankruptcy Law of any jurisdiction, which proceeding shall remain undismissed or
unstayed for a period of 30 days, (iii) a general assignment for the benefit of
his creditors shall be made by Borrower, or (iv) the Borrower admits in writing
his inability to pay his debts as they mature;
then the entire outstanding and unpaid principal under this Note, together with
all accrued and unpaid interest under this Note, shall automatically become and
be due and payable, without presentment, demand, protest or any notice of any
kind, all of which are hereby expressly waived by Borrower.
7. Waiver. No failure or delay on the part of the Company or any other
holder of this Note in exercising any right, power or privilege under this Note
and no course of dealing between Borrower, the Company or any other holder shall
operate as a waiver of any right, power or privilege under this Note, nor shall
any single or partial exercise of any right, power or privilege under this Note
preclude any other exercise of any right, power or privilege under this Note or
the exercise of any other right, power or privilege.
8. Presentment and Demand. Borrower hereby waives presentment, demand and
notice of nonpayment, dishonor and protest.
9. Notices. All notices, requests, demands and other communications
permitted or required hereunder shall be in writing, shall refer to this Note
and may be delivered in person, or by United States mail, certified or
registered, return receipt requested, or by facsimile, receipt confirmed, or
otherwise actually delivered to the parties at their addresses set forth below,
or such other addresses as the parties may designate by like notice:
(a) If to the Company, to:
Dynacs Engineering Company, Inc.
35111 U.S. Highway 19 North, Suite 300
2
<PAGE> 115
Palm Harbor, Florida 34684
Attn: President
Fax: (813) 787-2503
(b) If to the Borrower, to:
Mr. Michael Burns
c/o Prudential Securities
2049 Century Park East, Suite 1200
Los Angeles, California 90067
Fax: (310) 458-7595
with a copy to:
Richard E. Troop, Esq.
Troop Steuber Pasich Reddick & Tobey, LLP
2029 Century Park East, 24th Floor
Los Angeles, CA 90067
Fax: (310) 728-2201
Any such notice shall be deemed given, if delivered personally, upon receipt, if
sent by certified or registered mail 3 days after deposit (postage prepaid) with
the U.S. mail service, and if sent by facsimile, one business day following the
date receipt is confirmed.
10. Governing Law. This Note shall be governed and construed in accordance
with the laws of the State of California applicable to contracts made and to be
performed entirely within the State of California, without regard to principles
of conflicts of law.
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Secured Promissory Note as of the date first above written.
------------------------------
Michael Burns
3
<PAGE> 116
SCHEDULE
TO
PROMISSORY NOTE
Dated as of July ___ 1999
ADVANCES
No advances have been made as of the date of this Schedule.
BORROWER: COMPANY:
- ------------------------ DYNACS ENGINEERING COMPANY, INC.,
Michael Burns a Florida Corporation
By:
--------------------------------
Dr. Ramendra P. Singh
Its: President
4
<PAGE> 117
EXHIBIT G
to
CONTRIBUTION AND EXCHANGE AGREEMENT
Dated as of August 12, 1999
FORM OF SECURITY AGREEMENT
PLEDGE AND SECURITY AGREEMENT
THIS PLEDGE AND SECURITY AGREEMENT (this "Agreement"), is made and entered
into as of ________ 1999, by and between DYNACS ENGINEERING COMPANY, INC., a
Florida corporation (the "Company"), and MICHAEL BURNS ("Borrower").
RECITALS
A. Pursuant to that certain Non-Recourse Secured Promissory Note, dated
the date of this Agreement, between Borrower and the Company (the "Note"),
Borrower from time to time may become indebted to the Company in the aggregate
principal amount of up to $600,000.00 (the "Loan").
B. Pursuant to that certain Contribution and Exchange Agreement, dated as
of August 12, 1999, among the Company, Cerulean Colonization L.L.C.
("Cerulean"), Cerulean FXs, Inc. ("FX"), and the members of Cerulean (including
Borrower) whose names appear on Exhibit A to the agreement (the "Contribution
Agreement"), Borrower will acquire on the closing of the Contribution Agreement
12,381 shares (the "Shares") of common stock, par value $0.01 per share, of FX
in exchange for the contribution by Borrower of certain securities owned by him.
C. At the closing of the Contribution Agreement, the members of Cerulean
(including Borrower), the Company and an existing stockholder of the Company are
entering into that certain Exchange Agreement (the "Exchange Agreement")
providing for, among other things, the exchange by the members of their FX
Shares for shares (the "Exchange Shares") of common stock, par value $0.01 per
share, of the Company upon the occurrence of certain events.
D. As a material inducement to the Company to make the Loan to Borrower,
and to secure the performance by Borrower of his obligations under the Note,
Borrower has agreed to enter into this Agreement.
<PAGE> 118
AGREEMENT
NOW, THEREFORE, in consideration of foregoing premises and in order to
induce the Company to make the Loan, Borrower hereby agrees as follows:
1. Pledge. As security for Borrower's full and faithful performance of
each and all of his obligations and liabilities under the Note and this
Agreement, and any and all modifications, extensions or renewals of the Note and
this Agreement, Borrower hereby creates and grants to the Company a security
interest in and to: (a) the Shares, and, other than as set forth in Section
7(a)(ii) below, any monies, securities, rights and property issued or received
in exchange for the Shares or with respect to the Shares, including, without
limitation, any cash dividends or distributions, any securities that may be
issued to Borrower as a stock dividend and any securities, rights or other
property which Borrower may receive after the date of this Agreement or be
entitled to receive in exchange for the Shares, whether upon a merger,
reorganization, consolidation, stock split or reclassification, or otherwise,
including the Exchange Shares; and (b) any and all additions and substitutions
to and for the foregoing and the proceeds of any of the foregoing (collectively,
the "Collateral").
2. Security for Obligations. This Agreement secures and the Collateral is
security for the full and prompt payment when due (whether at stated maturity,
by acceleration or otherwise) of all amounts payable by Borrower to the Company
under the Note, whether for principal, interest, fees, costs or expenses now or
hereafter existing under the Note or this Agreement (the "Secured Obligations").
3. Delivery. In furtherance of the grant of the security interest referred
to in Section 1 of this Agreement, (a) Borrower has delivered to the Company,
concurrently with the execution and delivery of this Agreement, all certificates
representing the Collateral, together with instruments of transfer or assignment
duly executed in blank, and (b) Borrower shall deliver to the Company, promptly
after they are received by Borrower, certificates and other indicia of ownership
representing any securities or other instruments referred to in Sections 1(a)
and 4 of this Agreement which are not currently held by Borrower, including,
without limitation, certificates representing the Exchange Shares, together with
instruments of transfer or assignment duly executed in blank.
4. Additional Collateral Received by Borrower Except as set forth in
Section 7(a)(ii) below, any money, securities or other property received by
Borrower after the date of this Agreement in respect of or in exchange or
substitution for any of the Collateral shall be, and shall be deemed to have
been, received by Borrower as trustee for the Company, and Borrower shall
forthwith, without any notice or demand whatsoever (all notices, demands and
other actions on the part of the Company being hereby expressly waived) endorse,
transfer and deliver any and all such sums, securities and other property to the
Company to be held by the Company as Collateral for the Secured Obligations.
5. Representations and Warranties. Borrower hereby represents and warrants
to the Company as follows:
(a) Borrower is the sole record and beneficial owner of the Shares
free and clear of any "Lien" (as defined in the Contribution Agreement) on or
affecting title to the Shares, except
2
<PAGE> 119
for the Liens created by this Agreement and Liens created or existing under the
Exchange Agreement and the "Shareholders Agreement" (as defined in the
Contribution Agreement).
(b) Under the California Uniform Commercial Code, the pledge of the
Collateral pursuant to this Agreement will create a valid and perfected first
priority security interest in the Collateral, securing the payment of the
Secured Obligations.
(c) No consent, authorization, approval or other action by, and no
notice to or filing with, any governmental authority is required either (i) for
the pledge of the Collateral by Borrower pursuant to this Agreement or for the
due execution, delivery or performance of this Agreement by Borrower, or (ii)
for the exercise by the Company of the rights provided for in this Agreement or
of the remedies in respect of the Collateral pursuant to this Agreement, except
as may be required in connection with the disposition of the Collateral by laws
affecting the offering and sale of securities generally.
6. Further Assurances. Borrower agrees that at any time and from time to
time, at the cost and expense of Borrower, he will promptly execute and deliver
all further instruments and documents, and take all further action, that may be
necessary or desirable, and that the Company may reasonably request, in order to
perfect and protect the lien and security interest granted by this Agreement or
to enable the Company to enforce its rights and remedies under this Agreement
with respect to the Collateral.
7. Voting Rights: Dividends. Etc
(a) As long as no "Event of Default" (as defined in the Note) shall
have occurred and be continuing:
(i) Borrower shall be entitled to exercise any and all voting
and other consensual rights pertaining to the Collateral or any part thereof for
any purpose not inconsistent with the terms of this Agreement; and
(ii) Borrower shall be entitled to receive and retain any and
all dividends and distributions paid or made in respect of the Collateral.
(b) Upon the occurrence and during the continuance of an Event of
Default:
(i) Upon notice by the Company to Borrower, all rights of
Borrower to exercise the voting and other consensual rights which he would
otherwise be entitled to exercise pursuant to Section 7(a) (i) above shall
cease, and all such rights shall at that time become vested in the Company
who shall have the sole right to exercise the voting and other consensual
rights pertaining to the Collateral.
(ii) All rights of Borrower to receive the dividends and/or
distributions which it would otherwise be authorized to receive and retain
pursuant to Section 7(a)(ii) above shall cease, and all of these rights
shall at that time become vested in the Company who shall have the sole
right to receive and hold as collateral those dividends and/or
distributions.
3
<PAGE> 120
(iii) Borrower shall, if necessary to permit the Company to
exercise the voting and other rights which it may be entitled to exercise
pursuant to Section 7(b)(i) above and to receive all dividends and
distributions which it may be entitled to receive under Section
7(b)(ii)above, execute and deliver to the Company, from time to time and
upon written notice of the Company, appropriate proxies, dividend and
distribution payment orders and other instruments as the Company may
request.
8. Transfers and Other Liens. Borrower agrees that he will not (i) sell,
assign, transfer, pledge or otherwise dispose of, or grant any option or warrant
with respect to, any of the Collateral, except as otherwise required and/or
permitted under the Contribution Agreement, the Exchange Agreement or the
Shareholders Agreement, provided that prior to any transfer to a family member
of Borrower or a trust or other legal entity pursuant to Section 3(b) of the
Shareholders Agreement, the Family Member, trust or other legal entity shall
execute and deliver to the Company an agreement, in form and substance
reasonably satisfactory to the Company, pursuant to which such family member,
trust or other entity assumes all obligations of Borrower under, and agrees to
become bound by all of the terms and provisions of, this Agreement, or (ii)
create or permit to exist any Lien upon or with respect to any of the Collateral
except for the Liens created by this Agreement and Liens created or existing
under the Exchange Agreement and the Shareholders Agreement. Notwithstanding the
immediately preceding sentence, Borrower may, subject to the terms of the
Shareholders Agreement, enter into a contract for the sale or other disposition
of all or any portion of the Collateral, provided that Borrower's obligations
under the Note will be paid in full concurrently with the sale of the Shares.
9. Reasonable Care. The Company shall be deemed to have exercised
reasonable care in the custody and preservation of the Collateral in its
possession if the Collateral is accorded treatment substantially equal to that
which the Company accords its own property.
10. Remedies upon Default. If any Event of Default shall have occurred and
be continuing, the Company may exercise in respect of the Collateral, but
subject to the applicable terms of the Shareholders Agreement, all the rights
and remedies of a secured party after default under the California Uniform
Commercial Code as in effect from time to time at law, in equity or otherwise
with respect to the Collateral, all such rights and remedies being cumulative,
not exclusive, and enforceable intermittently, successively or concurrently;
provided, however, that the Company shall not make any disposition of the
Collateral unless the Company shall first have given to Borrower such prior
notice in writing of the time on or after which the intended disposition is to
be made and the manner of the disposition as may be required under the
California Uniform Commercial Code as then in effect. The right of Borrower to
redeem the Collateral after an Event of Default shall require tender to the
Company of the fulfillment of all of the Secured Obligations, as well as the
expenses reasonably incurred by the Company in preparing the Collateral for
disposition in arranging for the sale of the Collateral, and the reasonable
attorneys' fees and legal expenses incurred in connection with the foregoing.
Upon disposition of the Collateral after default, the proceeds from the
disposition shall be applied first to the reasonable expenses of holding,
preparing for sale and selling the Collateral, and the reasonable attorneys'
fees and legal expenses incurred by the Company in connection with the
foregoing, and then to satisfaction of the Note; any and all amounts remaining
shall be promptly paid, without offset, to Borrower. The Company acknowledges
and agrees that the Note is nonrecourse to Borrower and that the Company's sole
recourse and remedy upon an Event of
4
<PAGE> 121
Default shall be the exercise of its rights with respect to the Collateral as
provided in this Agreement.
11. Term; Return of Collateral. This Agreement commenced on the date first
set forth above and shall terminate upon payment and performance in full by
Borrower of the Secured Obligations. Upon or concurrently with payment and
performance in full by Borrower of the Secured Obligations, the Company shall
immediately deliver to Borrower the Collateral, together will the executed
instruments of transfer or assignment, held by the Company under this Agreement,
and this Agreement shall terminate.
12. Miscellaneous
(a) Notices. All notices, requests, demands and other communications
permitted or required hereunder shall be in writing, shall refer to this
Agreement and may be delivered in person, or by United States mail, certified or
registered, return receipt requested, or by facsimile, receipt confirmed, or
otherwise actually delivered to the parties at their addresses set forth below,
or such other addresses as the parties may designate by like notice:
(i) If to the Company, to:
Dynacs Engineering Company, Inc.
35111 U.S. Highway 19 North, Suite 300
Palm Harbor, Florida 34684
Attn: President
Fax: (727) 787-2503
(ii) If to the Borrower, to:
Mr. Michael Burns
c/o Prudential Securities
2049 Century Park East, Suite 1200
Los Angeles, California 90067
Fax: (310) 458-7595
with a copy to:
Richard E. Troop, Esq.
Troop Steuber Pasich Reddick & Tobey, LLP
2029 Century Park East, 24th Floor
Los Angeles, CA 90067
Fax: (310) 728-2201
Any such notice shall be deemed given, if delivered personally, upon receipt; if
sent by certified or registered mail 3 days after deposit (postage prepaid) with
the U.S. mail service; and if sent by facsimile, one business day following the
date receipt is confirmed.
5
<PAGE> 122
(b) Costs and Attorneys' Fees. In the event that any action, suit or
other proceeding is instituted concerning or arising out of this Agreement, the
prevailing party shall be entitled to recover all of the prevailing party's
costs and reasonable attorneys' fees incurred in each and every such action,
suit, or other proceedings, including any and all appeals or petitions
therefrom.
(c) Amendments. Etc. No amendment or waiver of any provision of this
Agreement nor consent to any departure by the Borrower from the terms of this
Agreement shall in any event be effective unless the same shall be in writing,
signed by the Company, and then such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given.
(d) Continuing Security Interest. This Agreement shall create a
continuing security interest in the Collateral and shall (a) remain in full
force and effect until indefeasible payment in full of all of the Secured
Obligations, (b) be binding upon Borrower and his assigns, and (c) inure,
together with the rights and remedies of the Company under this Agreement, to
the benefit of and be enforceable by the Company and its successors, transferees
and assigns.
(e) Severability and Governing Law. Should any Section or any part
of a Section within this Agreement be rendered void, invalid or unenforceable by
any court of law for any reason, the invalidity or unenforceability shall not
void or render invalid or unenforceable any other Section or part of a Section
in this Agreement. This Agreement shall be governed and construed in accordance
with the law's of the State of California applicable to contracts made and to be
performed entirely within the State of California, without regard to principles
of conflicts of law.
(f) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
(g) No Adverse Construction. The rule that a contract is to be
construed against the party drafting the contract is hereby waived, and shall
have no applicability in construing this Agreement or the terms of this
Agreement.
(h) Captions and Section Headings. Section titles or captions
contained in this Agreement are inserted as a matter of convenience and for
reference purposes only, and in no way define, limit, extend or describe the
scope of this Agreement or the intent of any provision hereof
6
<PAGE> 123
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
DYNACS ENGINEERING COMPANY, INC.,
a Florida Corporation
By:
------------------------------
Dr. Ramendra P. Singh
Its: President
-----------------------------------
Michael R. Burns
7
<PAGE> 124
EXHIBIT H
to
CONTRIBUTION AND EXCHANGE AGREEMENT
Dated as of August 12, 1999
FORM OF AMENDED AND RESTATED ARTICLES
OF INCORPORATION OF DYNACS
<PAGE> 125
AMENDED ARTICLES OF INCORPORATION
OF
DYNACS ENGINEERING COMPANY, INC.
The undersigned subscriber to these Articles of Incorporation, a natural
person competent to contract, hereby forms a corporation under the laws of the
State of Florida.
ARTICLE I. NAME
The name of the corporation shall be:
DYNACS ENGINEERING COMPANY, INC.
The principal place of business of this corporation shall be 35111 U.S. Highway
19 North, Suite 300, Palm Harbor, Florida 34684.
ARTICLE II. NATURE OF BUSINESS
This corporation may engage or transact in any or all lawful activities or
business permitted under the Laws of the United States, the State of Florida or
any other state, country, territory or nation.
ARTICLE III. CAPITAL STOCK
The maximum number of shares of stock that this corporation is authorized
to have issued and outstanding at any one time is 10,000,000 shares of common
stock having $.00l par value per share.
ARTICLE IV. ADDRESS
The street address of the initial registered office of the corporation
shall be 502 East Park Avenue, Tallahassee, Florida 32301, and the name of the
initial registered agent of the corporation at that address is Corporation
Information Services, Inc. - Gail Shelby.
<PAGE> 126
ARTICLE V. TERM OF EXISTENCE
This corporation is to exist perpetually.
ARTICLE VI. DIRECTORS
This corporation shall have one director, initially. The name and Street
address of the initial director who shall hold office for the first year of the
corporation, or until his successor is elected or appointed is:
Ramanendra Singh 118 Harbor Drive
Dir. Palm Harbor, Florida 34683
ARTICLE VII. SUBSCRIBER
The name and street address of the subscriber to these Articles of
Incorporation is:
Gail Shelby 502 East Park Avenue
Tallahassee, Florida 32301
IN WITNESS WHEREOF, the undersigned has hereunto set her hand and seal on
this _____ day of ,1999.
(SEAL)
--------------------------------
Gail Shelby
STATE OF FLORIDA
COUNTY OF LEON
The foregoing instrument was acknowledged before me this ______ day
of___________ 1999, by Gail Shelby.
- ----------------------------------------
Notary Public, State of Florida at Large
My Commission Expires: ___________
<PAGE> 127
EXHIBIT I
to
CONTRIBUTION AND EXCHANGE AGREEMENT
Dated as of August 12, 1999
FORM OF OPINION OF COUNSEL TO CERULEAN
<PAGE> 128
[LETTERHEAD OF TROOP STEUBER PASICH REDDICK & TOBEY, LLP]
__________ 1999
Dynacs Engineering Company, Inc.
35111 U.S. Highway 19 North, Suite 300
Palm Harbor, Florida 34684
Re: Cerulean Colorization, LLC
Ladies/Gentlemen:
We have acted as special counsel to Cerulean Colorization, LLC, a Delaware
limited liability company (the "Company"), in connection with the contribution
to Cerulean FXs, Inc., a Florida corporation ("FXs") by Dynacs Engineering
Company, a Florida corporation ("Dynacs"), of all the outstanding shares of
capital stock of Dynacs Digital Services, Inc., a Delaware corporation
("Digital"), and a wholly-owned subsidiary of Dynacs, and the contribution to
FXs by the several members of the Company (the "Cerulean Members") of all their
membership interests in the Company (the "Cerulean Membership Interests"),
pursuant to that certain Contribution and Exchange Agreement (the "Agreement"),
dated as of August 12, 1999, by and among Dynacs, FXs, the Company and the
Cerulean Members.
All capitalized terms not otherwise defined herein shall have the same
meaning herein as in the Agreement.
We are delivering this opinion at the request of the Company to you
pursuant to the provisions of Section 7.12 of the Agreement.
For purposes of rendering the opinions set forth in this letter (the
"Opinion"), we have reviewed originals or copies of the following documents:
(i) The Certificate of Formation of the Company, as certified by the
Secretary of State of the State of Delaware (the "Certificate of
Formation");
(ii) That certain Operating Agreement of the Company, dated as of
December 23, 1996, by and among the Cerulean Members;
(iii) The Agreement;
<PAGE> 129
Dynacs Engineering Company, Inc.
____________, 1999
Page 2
(iv) That certain Exchange Agreement, dated as of even date herewith, by
and between Dynacs, Dr. Ramendra Singh and the Cerulean Members (the
"Exchange Agreement");
(v) That certain Shareholders Agreement, dated as of even date herewith,
by and among the Cerulean Members, Dynacs, and the several capital
stockholders of Dynacs (the "Shareholders Agreement");
(vi) That certain Registration Agreement, dated as of even date herewith,
by and between Dynacs and the Cerulean Members (the "Registration
Agreement");
(vii) That certain Pledge and Security Agreement, dated as of even date
herewith, by and between Dynacs and Michael Bums (the "Pledge");
(viii) That certain Non-Recourse Secured Promissory Note, dated as of even
date herewith, by Michael Burns in favor of Dynacs (the "Note");
(ix) That certain Right of First Refusal Agreement, dated as of even date
herewith, by and between Dynacs and Michael Bums;
(x) Those agreements, indentures, mortgages, leases, notes or other
obligations or instruments certified to us to be a complete list of
all agreements, indentures, mortgages, leases, notes or other
obligations or instruments material to the business of the Company
(the "Material Contracts"); and
(xi) Such other documents as we have deemed necessary or appropriate in
order to render this Opinion.
For purposes of this Opinion, the Exchange Agreement, the Shareholders
Agreement, the Registration Agreement, the Pledge and the Note are collectively
referred to herein as the "Ancillary Agreements."
In connection with the examination we undertook for purposes of rendering
this Opinion, we have assumed, without investigation or inquiry, the
authenticity of all documents submitted to us as originals, the genuineness of
all signatures, the legal capacity of natural persons and the conformity to the
originals of all documents submitted to us as copies. In addition, without any
independent investigation or inquiry, we have assumed that (a) all parties to
such documents had the power, corporate or other, to enter into and perform all
obligations thereunder (other than the power and authority as a limited
liability company of the Company to enter into the Agreement), (b) such
documents were duly authorized by all requisite action, corporate or other
(other than due authorization of the Agreement by the Company) (c) all such
documents were duly executed and delivered by all Persons which are a party
thereto and are valid, binding and enforceable obligations
<PAGE> 130
Dynacs Engineering Company, Inc.
___________, 1999
Page 3
of such Persons (other than the due execution of the Agreement by the Company
and the validity, binding effect or enforceability of the Agreement and the
Ancillary Agreements against the Company and the Cerulean Members), and (d) all
statements, representations and warranties of all parties to each of such
documents are true, correct and complete in all respects as of the date made and
as of the Closing, or in the case of any representations and warranties which
address matters only as of a particular date, as of such date.
As to the truth and accuracy of all factual matters which are material to
this Opinion, we have relied, without investigation or inquiry, solely upon
certificates or other comparable documents of officers, stockholders or other
representatives of the Company (the "Officer Certificates"), certificates of
governmental agencies and upon the representations and warranties of each of the
parties to the Agreement and upon the relevant facts stated therein, all of
which we have assumed to be true and complete in the absence of actual knowledge
to the contrary.
Whenever the phrase "to our knowledge," "known to us" or words of similar
import, appears in this Opinion, it means that, unless otherwise expressly
stated herein, (a) we have relied exclusively on the review of the documents
described in paragraphs (i) through (xi) above and the Officers' Certificates
referred to above, (b) we have made no examination of public records (including,
without limitation, the plaintiff or defendant indices of state and federal
courts), whether or not examination or investigation might otherwise be
reasonable or prudent and (c) no attorney (1) who has participated in
representing the Company during the last twelve months and (2) who is currently
employed by or is a member of this firm has any conscious awareness of facts
which indicates that any of the opinions contained herein which are made to our
knowledge are untrue. Unless otherwise expressly stated herein, we have not
undertaken any independent investigation to determine the existence or absence
of any such facts or other information and no inference as to the existence or
absence of such facts should be drawn from our representation of the Company.
Whenever the phrase "to our knowledge," "known to us" or words of similar import
appears at the beginning of a sentence herein, it shall be construed to apply to
and to modify every word, phrase and clause of that sentence.
Based on the foregoing, and subject to the assumptions, qualifications and
limitations set forth herein, as of the date hereof we are of the opinion that:
1. The Company is a limited liability company duly organized, validly existing
and in good standing under the laws of the state of Delaware and has the power
and authority as a limited liability company to own, lease and operate its
properties and to carry on its business as, to our knowledge, it is now being
conducted.
2. The Company is duly qualified or licensed and in good standing as a foreign
company under the laws of each jurisdiction in which the Company has certified
to us that it owns or leases real property or permanently maintains offices or
employees, except
<PAGE> 131
Dynacs Engineering Company, Inc.
____________, 1999
Page 4
where the failure to be so qualified or be in good standing would not have a
material adverse effect on the Company, taken as a whole.
3. The Company has the requisite power and authority as a limited liability
company to enter into the Agreement and to consummate the transactions
contemplated thereby. The execution, delivery and performance of the Agreement
has been duly authorized by the Company constitutes the legal, valid and binding
obligation of the Company, enforceable against the Company in accordance with
its terms.
4. The Agreement and the Ancillary Agreements to which they are parties
constitute the legal, valid and binding obligation of the Cerulean Members,
enforceable against the Cerulean Members in accordance with their terms.
5. No order, authorization, consent or approval of or registration, declaration
or filing with any state or federal governmental authority or agency is required
to be filed by the Company or the Cerulean Members in connection with the
Agreement and the Ancillary Agreements to which they are a party, or the
consummation by the Company or the Cerulean Members of the transactions
contemplated thereby.
6. The execution, delivery and performance of the Agreement by the Company,
compliance by the Company with all the provisions thereof and the consummation
of the transactions contemplated thereby will not (a) result in any violation of
the Certificate of Formation, or (b) result in a material breach or violation of
any of the terms and provisions of, or constitute, either by itself or upon
notice or the passage of time or both, a default under, (i) any Material
Contract, or (ii) to our knowledge, any material order, writ, decree or ruling
of any court, government or governmental agency or body having jurisdiction over
the Company which is applicable to the Company or any of its respective
properties or operations.
Our opinion set forth in Paragraph 1 above that the Company is validly
existing and in good standing under the laws of the State of Delaware is given
as of the dates set forth below and it is based solely upon:
(a) the Certificate of Formation;
(b) a letter of good standing with respect to the Company from the
Secretary of State of the State of Delaware, dated July 15, 1999; and
(c) an oral bringdown of good standing with respect to the Company from
the Secretary of State of the State of Delaware, obtained ___________, 1999.
With respect to our opinion set forth in Paragraph 1 above, that the
Company has the "power and authority as a limited liability company" to take
certain action, we interpret that phrase to mean that the action would not be
ultra vires with respect to the Company. The opinions with respect to "power and
authority as a limited liability
<PAGE> 132
Dynacs Engineering Company, Inc.
____________, 1999
Page 5
company" of the Company do not, however, extend to any other federal, state or
local authorizations or approvals.
As to our opinion set forth in Paragraph 3 above, we do not opine as to,
and we have not reviewed or examined:
(a) any local, municipal, county, district or regional law, statute,
order, decree, administrative record, policy, procedure, guideline, rule,
requirement, regulation or notice; or
(b) any policy, procedure, guideline, rule, requirement or regulation that
is privileged, confidential, internal, unpublished, or not of public record or
widely disseminated at the date of this opinion.
Our opinions set forth in Paragraph 3 and 4 hereof are further subject to
the following qualifications:
(a) enforceability may be subject to or limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws
relating to or affecting creditors' rights generally, or the
appointment of a receiver or conservator pursuant to state or
federal laws;
(b) the availability of equitable remedies, specific performance and
injunctive relief is subject to the discretion of the court before
which any proceeding therefor is brought;
(c) the enforceability of certain covenants may be limited to the extent
that the court before which any proceeding for the enforcement
thereof is brought concludes that such enforcement would be
unreasonable, unconscionable or unnecessary for the protection of
the parties to such agreement under existing circumstances;
(d) enforcement of certain rights may be unavailable if any of the
parties seek to enforce their rights other than in good faith and in
a manner in which it is commercially reasonable to do so;
(e) rights to indemnity may be limited by applicable laws or the public
policy underlying such laws;
(f) waivers of statutes of limitations, notice, jury trial and due
process may contravene public policy and statutory and case law, and
therefore may be unenforceable;
(g) contractual provisions waiving broadly or vaguely stated rights or
unknown future rights, and/or provisions that rights or remedies are
not
<PAGE> 133
Dynacs Engineering Company, Inc.
____________, 1999
Page 6
exclusive, that every right and remedy is cumulative and may be
exercised in addition to or together with any other right or remedy
or that the election of some particular remedy or remedies does not
preclude recourse to one or more others, may be unenforceable; and
(h) enforceability may be subject to or limited by the effect of general
principles of equity, including without limitation concepts of
materiality, reasonableness, good faith and fair dealing, regardless
of whether considered in a proceeding in equity or at law.
With your consent, we have not opined as to any issues other than those
expressly set forth herein. In rendering this Opinion, we have reviewed the
Report of the Committee on Corporations Regarding Legal Opinions in Business
Transactions (1989), prepared by members of the Committee on Corporations of the
Business Law Section of the State Bar of California (the "Report"), and intend
that the terms used herein have the meaning ascribed to them in the Report. In
rendering this Opinion, our review has been limited to laws, rules and
regulations currently in effect which we believe (based on our experience with
similar transactions) should be applicable to those transactions contemplated by
the Agreement, and we have not made any special investigation concerning any
other law, rule or regulation.
We have not been requested to opine, and we have not opined, as to any
matters other than those expressly set forth herein. This Opinion extends only
to questions of the law of the State of California, the federal law of the
United States of America, and the General Corporation Law of the State of
Delaware, and we express no opinion with respect to any other laws or the law of
any other jurisdiction. We are attorneys licensed to practice law in the State
of California and we do not purport to be experts as to the law of any
jurisdiction other than the State of California and the federal law of the
United States of America. We note that the Agreement and certain of the
Ancillary Agreements purport to be governed by the laws of the State of Florida.
For purposes of this Opinion, we have assumed that the laws of the State of
Florida are identical to the laws of the State of California.
The opinions expressed herein are subject to statutory, regulatory and
case law developments after the date hereof. With your consent and concurrence,
this Opinion is limited to facts and applicable law in existence as of the date
hereof and we do not undertake and expressly disavow any duty or obligation to
advise you of any change in facts or applicable law after the date hereof,
whether or not relating to the specific issues addressed in this Opinion, and
you may not rely upon us in any respect with regard to continuing advice
concerning changes in applicable law or facts after the date of this Opinion.
This Opinion is solely for your benefit in connection with the Agreement
and the transactions contemplated thereby, and this Opinion is not to be
circulated or quoted or
<PAGE> 134
Dynacs Engineering Company, Inc.
____________, 1999
Page 7
otherwise relied upon by you for any other purposes or by any other person
without our prior written consent.
Respectfully submitted,
TROOP STEUBER PASICH
REDDICK & TOBEY, LLP
<PAGE> 135
EXHIBIT J
to
CONTRIBUTION AND EXCHANGE AGREEMENT
Dated as of August 12, 1999
FORM OF OPINION OF COUNSEL TO DYNACS
<PAGE> 136
August 13, 1999
Michael Burns
Wiliam Dallas
Jon Feltheimer
Offense Group Associates, L.P.
c/o Michael Burns, Member Representative
Prudential Securities
2049 Century Part East, Suite 1200
Los Angeles, California 90067
Re: Dynacs Engineering Company/Acquisition of Cerulean (10871-0202)
Ladies and Gentlemen:
We have acted as counsel for Dynacs Engineering Company, Inc., a Florida
corporation ("Dynacs"), and Cerulean FXs, Inc., a Florida corporation ("FXS"),
in connection with the contributon to FXS by Dynacs of all the outstanding
shares of capital stock of Dynacs Digital Services, Inc., a Delaware corporation
("Digital"), and a wholly-owned subsidiary of Dynacs, and the contribution to
FXS by the several members (the "Cerulean") of Cerulean Colorization, LLC, a
Delaware limited liability company ("Cerulean Members") of all their membership
interests in Cerulean (the "Cerulean Membership Interests"), pursuant to that
certain Contribution and Exchange Agreement (the "Agreement"), dated as of
August 12,1999, by and among Dynacs, FXS, Cerulean and the Cerulean Members.
Capitalized terms not defined herein shall have the meanings ascribed to them in
the Agreement. We are rendering this opinion to you pursuant to Section 8.11 of
the Agreement.
In connection herewith, in our capacity as counsel to Dynacs and EMS, we
have examined, among other things, the originals or copies, certified or
otherwise, and identified to our satisfaction as being true copies of the
following:
i. the Restated Articles of Incorporation of Dynacs, as filed with the
Secretary of State of the State of Florida on August 11, 1999 (the
"Dynacs Articles");
<PAGE> 137
ii. the Articles of Incorporation of FXS, as filed with the Secretary of
State of the State of Florida on April 14, 1999 (the "FXS
Articles");
iii. the Bylaws of Dynacs, as in effect on the date hereof (the "Dynacs
Bylaws");
iv. the Bylaws of FXS, as in effect on the date hereof (the "Dynacs
Bylaws");
v. the Certificate of the Secretary of State of the State of Florida
dated June 22, 1999 attesting to the good standing of Dynacs in the
State of Florida;
vi. the Certificate of the Secretary of State of the State of Florida
dated June 22, 1999 attesting to the good standing of FXS in the
State of Florida;
vii. the Agreement;
viii. that certain Exchange Agreement, dated as of even date herewith, by
and between Dynacs, Dr. Ramendra Singh and the Cerulean Members (the
"Exchange Agreement")
ix. that certain Shareholders Agreement, dated as of even date herewith,
by and among the Cerulean Members, Dynacs and the several capital
stockholders of Dynacs (the "Shareholder Agreement")
x. that certain Registration Agreement dated as of even date herewith,
by and between Dynacs and the Cerulean Members (the "Registration
Agreement")
xi. that certain Pledge and Security Agreement, dated as of even date
herewith, by and between Dynacs and Michael Burns (the "Pledge");
xii. that certain Right of First Refusal Agreement, dated as of even date
herewith (the "Right of First Refusal Agreement"), by and between
Dynacs and Burns;
xiii. that certain Employment Agreement, dated as of even date herewith
(the "Employment Agreement"), by and between Cerulean and Tracy
Pearce;
xiv. that certain Non-Recourse Secured Promissory Note, dated as of even
date herewith, by Michael Burns in favor of Dynacs (the "Note");
xv. those agreements, indentures, mortgages, leases, notes or other
obligations or instruments certified to us to be a complete list of
all agreement, indentures, mortgages, leases, notes or other
obligations or instruments material to the business of Dynacs and/or
FXs; and
xvi. such other documents as we have deemed necessary or appropriate as a
basis for the opinions hereinafter expressed.
For purposes of this opinion, the Agreement, the Shareholders Agreement, the
Exchange
<PAGE> 138
Agreement, the Registration Agreement, the Pledge, the Right of First Refusal
Agreement and the Employment Agreement are collectively referred to herein as
the "Transaction Documents".
In our examination, we have assumed the genuineness of all signatures
(except those of Dynacs and FXs), the authenticity of all documents submitted to
us as originals, the conformity to original documents of all documents submitted
to us as certified or photostatic copies and the authenticity of the originals
of such latter documents. As to various questions of fact material to this
opinion, we have relied upon the representations and warranties of Dynacs
contained in the Agreement, and upon a certificate of the President of Dynacs
attached hereto as Annex A and a certificate of the President of FXS attached
hereto as Annex B, but without any further independent investigation. In
addition, we have obtained and relied upon such certificates and assurances from
public officials as we have deemed necessary. We have assumed that such
representations and warranties, and such certifications and assurances are true,
correct and complete, and do not have any knowledge that such representations
and warranties, and such certificates and assurances are not true, correct and
complete. For purposes of our opinions in paragraph I below as to the good
standing of Dynacs and FXS in the State of Florida, we have relied solely upon
the certificates described in clauses (v) and (vi) above.
As used in this opinion, the expression "to our knowledge" with reference
to manners of fact means that, after an examination of documents made available
to us by Dynacs and FXS and based on our knowledge, as qualified below, and
further based on the representations and warranties of Dynacs in the Agreement,
and upon a certificate of the President of Dynacs attached hereto as Annex A and
a certificate of the President of FXS attached hereto as Annex B, but without
any further independent factual investigation (it being understood that you and
we have agreed that we have no express or implied obligation to conduct any such
independent factual investigation), we find no reason to believe that the
opinions expressed herein are factually incorrect. Further, the expression "to
our knowledge" with reference to matters of fact refers to the current actual
knowledge of the attorneys of this firm who have worked on matters for Dynacs
and FSX Except to the extent expressly set forth hereinabove, we have not
undertaken any independent investigation to determine the existence or absence
of any fact, and no inference as to our knowledge of the existence or absence of
any fact should be drawn from our representation of Dynacs and FXS or the
rendering of the opinions set forth below.
In rendering the opinions expressed herein, we have also assumed (i) the
due authorization of the Transaction Documents by all parties thereto other than
Dynacs and FXS, (ii) that all parties to the Transaction Documents other than
Dynacs and FXS have the full power and legal right to enter into the Transaction
Documents and to consummate the transactions contemplated thereby and the
Transaction Documents are enforceable against such parties in accordance with
their terms, (iii) that all parties to the Transaction Documents other than
Dynacs and FXS have duly executed and delivered the Transaction Documents, and
(iv) that all parties to the Transaction Documents other than Dynacs or FXS will
fully and completely perform their respective obligations under the Transaction
Documents.
We are members of the bar of the State of New York and we do not herein
express any opinion as to any matters governed by any laws other than the laws
of the State of New York, the General Corporation Law of the State of Delaware
and the laws of the United States of America. We recognize that the Transaction
Documents are governed by the laws of the State of California;
<PAGE> 139
therefor, insofar as our opinions in paragraph 2 below pertain to matters of the
laws of the State of California (the "California Law"), we have assumed, with
your consent, that the California Law is identical in all respects to the
appropriate laws of the State of New York. Insofar as our opinions below pertain
to matters of the laws of the State of Florida, we have relied solely on the
opinions of Lentz & Fair, PA., Florida counsel to Dynacs and FXs, and our
opinions expressed herein as to such laws are qualified by the exceptions and
other qualifications stated in such opinions of Lentz & Fair, P.A.
Certain of the opinions rendered herein are qualified by the discussion
following the numbered paragraphs in our opinion.
Based upon the foregoing, and subject to the qualifications and exceptions
heretofore and hereinafter set forth, we are of the opinion that:
1. Each of Dynacs and FXS is a corporation duly organized, validly
existing and in good standing under the laws of the State of Florida. Each of
Dynacs and EMS has the corporate power and authority to own, lease and operate
its properties and to carry on its business as now being conducted and is duly
qualified or licensed to do business and is in good standing in each
jurisdiction in which the failure to be so qualified would have a material
adverse effect on Dynacs and its subsidiaries, taken as whole, or FXs.
2. Each of Dynacs and FXS has all requisite corporate power and authority
to enter into the Transaction Documents to which it is a party, and to
consummate the transactions contemplated thereby. The execution and delivery of
the Transaction Documents and the consummation of the transactions contemplated
thereby have been duly authorized by all necessary corporate action on the part
of each of Dynacs and FXS. The Transaction Documents to which each of Dynacs and
FXS is a party have been duly executed and delivered by each of Dynacs and FXS,
as the case may be, and constitute the valid and binding obligations of each of
Dynacs and FXS, as the case may be, enforceable in accordance with their terms.
3. No order, authorization, consent or approval of, or registration.
declaration or filing with any state or federal governmental authority or agency
is required in connection with the Transaction Documents or the consummation by
Dynacs or FXS of the transactions contemplated thereby.
4. The execution, delivery and performance of the Transaction Documents by
Dynacs, compliance by Dynacs with all the provisions thereo, and the
consummation of the transactions contemplated thereby will not (a) result in any
violation of the Dynacs Articles or the Dynacs Bylaws, or (b) to our knowledge,
result in a material breach or violation of any of the terms and provisions of,
or constitute, either by itself or upon notice or the passage of time or both, a
default under, (i) any of the Material Contacts of Dynacs or any of its
Subsidiaries or (ii) any material order, writ, decree or ruling of any court,
government or governmental agency or body having jurisdiction over Dynacs or any
of its Subsidiaries which is applicable to Dynacs or any of its Subsidiaries or
any of their respective properties or operations.
5. The 100,000 shares of FXS Common Stock issued pursuant to the Agreement
(the "FXS Shares") have been duly and validly authorized and, upon issuance in
accordance with the
<PAGE> 140
Agreement, will be validly issued, fully paid and nonassessable, and the holders
thereof will not be subject to personal liability to third parties solely by
reason of being holders thereof. The FXS Shares are not subject to any statutory
preemptive right under the laws of the State of California or, to our knowledge,
any contractual preemptive right.
6. Those shares of Dynacs Common Stock, which are to be issued to the
Cerulean Members pursuant to the Exchange Agreement (the "Dynacs Shares"), have
been duly and validly authorized and, upon issuance in accordance with the
Exchange Agreement, will be validly issued, fully paid and nonassessable, and
the holders thereof will not be subject to personal liability to third parties
solely by reason of being holders thereof. The Dynacs Shares are not, and when
issued in accordance with the Exchange Agreement, will not be, subject to any
statutory preemptive right under the laws of the State of California or, to our
knowledge, any contractual preemptive right.
7. The authorized capital stock of Dynacs consists of 10,000,000 shares,
all of which have been designated common stock, par value 3.001 per share. There
are 4,453,750 shares of common stock of Dynacs issued and outstanding. All of
the outstanding shares of common stock of Dynacs are duly authorized, validly
issued, fully paid and nonassessable and have not been issued in violation of
any statutory preemptive right under the laws of the State of Florida or, to our
knowledge, any contractual preemptive right.
8. The authorized capital stock of FXS consists of 100,000 shares, all of
which have been designated common stock, par value $.01 per share. Upon issuance
of the FXS Shares in accordance with the Agreement, there will be 100,000 shares
of common stock of FXS issued and outstanding.
Our opinions set forth in paragraph 2 above, with respect to the
enforceability of the Transaction Documents or provisions thereof, are limited
by the following:
a. principles of public policy;
b. the effect of bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance or other similar laws now or hereafter in
effect relating to or affecting the rights and remedies of creditors
generally;
c. the effect of procedural due process, general principles of equity
including without limitation, principles of commercial
reasonableness, good faith, and fair dealing, whether such
enforcement is considered in a proceeding in equity or at law, and
the discretion of the court before which any proceeding therefor may
be brought, including the court's failure or refusal to enforce
provisions of agreements or documents if enforcement thereof is
based upon defaults or breaches which are immaterial to the ultimate
performance contemplated thereby or for other reasons deemed
equitable by the court;
d. we express no opinion regarding the availability of the remedy of
specific performance, injunctive relief or of any other equitable
remedy or relief to enforce any right under any agreement or
document; and
e. we express no opinion as to the enforceability, in any particular
circumstance, of any
<PAGE> 141
provision of the Transaction Documents which provides for the
severability of illegal or unenforceable provisions.
In addition, we express no opinion with respect to the applicability of
Hart-Scott-Rodino to the transactions contemplated by the Transaction Documents
or any filings required in connection therewith.
This opinion is solely for your benefit and, without our prior written
consent, shall not be quoted in whole or in part, summarized or otherwise
referred to, relied upon or filed with or supplied to any other person or
entity. We assume no obligation to supplement or update this opinion to reflect
any facts or circumstances which may hereafter come to our attention or any
changes in any laws or court decisions which may hereafter occur. We do not
render any opinion by implication or any opinion with respect to matters other
than those expressly set forth above.
<PAGE> 142
Sincerely yours,
Frankfurt, Garbus, Klein & Selz, P.C.
By:
----------------------------------
Gary A. Schonwald
<PAGE> 143
[LETTERHEAD OF LENTZ & FAIR, P.A.]
Frankfurt, Garbus, Klein & Selz
499 Madison Avenue
New York, NY 10022
RE: Dynacs Engineering Company/Acquisition of Cerulean
Dear Sirs:
Lentz & Fair, P.A. ("Lentz") has been retained as counsel for Dynacs
Engineering Company, Inc., a Florida corporation ("Dynacs"), and Cerulean FXs,
Inc., a Florida corporation ("FXs"), for the sole purpose of rendering the
opinions contained herein to Frankfurt, Garbus, Klein & Selz ("Frankfurt"), New
York counsel to Dynacs and FXs, which opinions will be relied upon by Frankfurt
in its rendering of opinions to Michael Bums, William Dallas, Jon Feitheimer and
Offense Group Associates, L.P. (collectively, the "Cerulean Members") pursuant
to Section 8.11 of that certain Contribution and Exchange Agreement, dated as of
August 12, 1999, by and among Dynacs, FXs, Cerulean Colorization, L.L.C., a
Delaware limited liability company ("Cerulean") and the Cerulean Members (the
"Agreement"), Except for the sole purpose of rendering the opinions contained
herein, Lentz did not represent any of the parties in the above-mentioned
transaction or advise any of the parties as to their rights in or for this
transaction, nor review any document not listed below.
All capitalized terms used herein not defined herein shall have the
meanings given such terms in the agreement.
Lentz has neither addressed nor given any opinion as to any issue opined
by Frankfurt unless expressly set forth herein. No opinion asserted by Lentz may
be construed as broader in scope than the express language of said opinion
whether or not said opinion is contended to be incomplete, inadequate, subject
to interpretation, or part of a larger issue, circumstance, case or allegation.
In connection herewith, in Lentz's capacity as counsel to Dynacs and FXs,
we have examined the originals or copies of the following documents:
(1) The Amended Articles of Incorporation of Dynacs as filed with the
Secretary of State of the State of Florida on August 11,1999
("Dynacs Articles");
<PAGE> 144
Frankfurt, Garbus, Klein & Selz
Page 2
(2) The Articles of Incorporation of FXs, as filed with the Secretary of
State of the State of Florida on April l4, 1999 ("FXs Articles");
(3) The Bylaws of Dynacs in effect on the date hereof ("Dynacs Bylaws");
(4) The Bylaws of EXs in effect on the date hereof ("FXs Bylaws");
(5) The Certificate of the Secretary of the State of Florida dated June
21, 1999 attesting to the good standing of Dynacs in the State of
Florida;
(6) The Certificate of the Secretary of the State of Florida dated July
28, 1999 attesting to the good standing of FXs in the State of
Florida;
(7) The Opinion Letter of Frankfurt dated as of the date hereof, with
enclosures listed below and identified as (7) (i) through (7) (ii):
(i) Annex A to the opinion of Frankfurt;
(ii) Annex B to the opinion of Frankfurt;
(8) Consent To Action In Lieu Of A Special Meeting Of The Board Of
Directors of Dynacs;
(9) Consent To Action In Lieu Of A Special Meeting Of The Board Of
Directors of FXs;
(10) Consent To Action In Lieu Of A Meeting Of The Shareholders of
Dynacs;
(11) Assignment and Transfer Agreement;
(12) The Certificate Representations and Warranties of Dynacs and FXs;
(13) Shareholders' Agreement;
(14) Registration Agreement;
(15) Exchange Agreement;
<PAGE> 145
Frankfurt, Garbus, Klein & Selz
Page 3
(16) First Refusal Agreement; and
(17) Security Agreement.
For the purpose of rendering this opinion, the Agreement, the Shareholders
Agreement, the Registration Agreement, the Exchange Agreement, the First Refusal
Agreement, and the Security Agreement are collectively referred to herein as the
"Transaction Documents."
As to the various questions of fact material to this opinion, Lentz has
relied upon the representations and warranties of Dynacs contained in the
documents listed above but without any further independent investigation. In
addition, Lentz has obtained and relied upon such certificates and assurances
from public officials as Lentz has deemed necessary.
Lentz has assumed that such representations and warranties and such
certifications and assurances are true, correct and complete and Lentz has no
knowledge that such representations and warranties and such certificates and
assurances are not true, correct and complete.
As used in this opinion, the expression "to our knowledge" with reference
to matters of fact means that, after an examination of the documents listed
above provided to us by Frankfurt on behalf of Dynacs and FXs, based on our
knowledge, as qualified below, and based on the representations and warranties
of Dynacs, a Certificate of the President of Dynacs listed as one of the
documents we have reviewed above, and a Certificate of the President of FXs
listed as one of the documents reviewed above, but without any further
independent factual investigation (it being understood that Lentz and Frankfurt
have agreed that Lentz has no express or implied obligations to conduct any such
independent and factual investigation), we find no reason to believe that the
opinions expressed herein are factually incorrect, Further, the expression "to
our knowledge" with reference to matters of fact refers to the current actual
knowledge of the attorneys of Lentz who have worked on matters for Dynacs and
FXs. Except to the extent expressly set forth herein, Lentz has not undertaken
any independent investigation to determine the existence or absence of any fact
and no inference as to Lentz's knowledge of the existence or absence of any
facts should be drawn from Lentz's representation of Dynacs and FXs or the
rendering of the opinion set forth below.
The attorneys of Lentz are members of the Bar of the State of Florida and
do not herein express any opinion as to any matters governed by any laws other
than the laws of the State of Florida.
Based upon the foregoing and subject to the qualifications and exceptions
heretofore and hereinafter set forth, we are of the opinion that:
(1) Each Dynacs and FXs have all requisite corporate power and
<PAGE> 146
Frankfurt, Garbus, Klein & Selz
Page 4
authority to enter into the Transaction Documents to which it is a
party, and to consummate the transactions contemplated therein. The
execution and delivery of the Transaction Documents and the
consummation of the transactions contemplated therein have been duly
authorized by all necessary corporate action on the part of each of
Dynacs and FXs.
(2) On July 14, 1998, Lent was informed by the Deputy Director of the
Small Business Administration ("S.B.A.") in Miami, Florida that
Dynacs' application for approval of the transaction contemplated
between Dynacs and Cerulean had been approved by the Administrator.
Such notification was oral but Lentz was informed that written
confirmation of the approval of this action will be forthcoming
within a "reasonable amount of time." Neither Lentz nor, to our
knowledge, Dynacs has received written authorization for the
approval of this transaction as of the date of this opinion. Other
than S.B.A. approval, there is, to our knowledge, no other order,
authorization, consent, approval, registration, declaration or
filing with any Florida authority or agency as required in
connection with the Transaction Documents or the consummation by
Dynacs or FXs of the transactions contemplated thereby.
(3) One hundred thousand (100,000) shares of FXs common stock with a par
value of 3.01 per share ("the FXs shares") have been duly and
validly authorized and, upon issuance in accordance with the
Agreement, will be validly issued, fully paid and nonassessable, and
the holders thereof will not be subject to personal liability to
third parties solely by reason of being shareholders thereof. The
FXs shares are not subject to any statutory preemptive right under
the laws of the State of Florida.
(4) The authorized capital stock of Dynacs consists of ten million
(10,000,000) shares, all of which have been designated common stock,
with a par value of $.001 per share. There are four million four
hundred fifty three thousand seven hundred fifty (4,453,750) shares
of common stock of Dynacs issued and outstanding. All of the
outstanding shares of Dynacs are duly authorized, validly issued,
fully paid, and non-assessable.
(5) Those shares of Dynacs' common stock, which are to be issued to the
Cerulean Members pursuant to the Exchange Agreement
<PAGE> 147
Frankfurt, Garbus, Klein & Selz
Page 5
(the "Dynacs Shares"), have been duly and validly authorized and,
upon issuance in accordance with the Exchange Agreement, will be
validly issued, fully paid and nonassessable, and the holders
thereof will not be subject to personal liability to third parties
solely by reason of being shareholders thereof. The Dynacs Shares,
when issued in accordance with the Exchange Agreement, are not
subject to any statutory preemptive right under the laws of the
State of Florida.
This opinion is solely for your benefit and the benefit of the Cerulean
Members, may be relied upon by you in rendering opinions to the Cerulean Members
in connection with the Agreement, and may be incorporated by reference into the
opinion letter rendered by you to the Cerulean Members. Except as set forth in
the immediately preceding sentence, without Lent's prior written consent, this
opinion letter shall not be quoted in whole or in part, summarized or otherwise
referred to, relied upon, filed with or supplied to any other person or entity.
We do not opine on the enforceability of the Transaction Documents or any other
such documents, nor the consummation of the transaction contemplated by any such
documents, as it is our understanding that such opinion will be furnished by
Frankfurt. We assume no obligation to supplement or update this opinion to
reflect any facts or circumstances which may hereafter come to Lentz's attention
or any changes in any laws or court decisions which may hereafter occur.
Sincerely yours,
LENTZ & FAIR, P.A.
H. James Lentz
Attorney at Law
HJL/psh
pc: Ms. Judy Hess
<PAGE> 148
SCHEDULE I
TO
CONTRIBUTION AND EXCHANGE AGREEMENT
Dated as of August 12, 1999
MEMBER DISCLOSURE SCHEDULE
NOTHING TO DISCLOSE
<PAGE> 1
Exhibit 10.18
LEASE
THIS LEASE made as of the 23 day of October, 1998 by and between TechPark
Limited Partnership, an Ohio limited partnership, having a principal office c/o
Chelm Properties, 31000 Aurora Road, Solon, Ohio 44139 (the "Landlord") and
Dynacs Engineering Company, Inc, a Florida corporation, having a principal
office at 35111 US Highway 19 North, Suite 300, Palm Harbor, Florida 34684 (the
"Tenant").
WITNESSETH:
ARTICLE I
PREMISES
1.1 Premises. Landlord, in consideration of the rents to be paid and the
covenants and agreements to be performed and observed by Tenant, does hereby
lease unto Tenant, and Tenant does hereby lease and take from Landlord, a
portion of the building (the "Building") located at 2001 Aerospace Parkway in
the City of Brook Park, County of Cuyahoga, and State of Ohio, located on the
real property (the "Land") more particularly described in Exhibit "A" attached
hereto and made a part hereof. The Land and the Building are hereinafter
sometimes jointly referred to as the "Property". The portion of the Building
being leased by Tenant hereunder contains approximately Fifty-nine Thousand
Seven Hundred Eighty-four (59,784) square feet of gross floor area (the
"Premises"), as more particularly depicted on the site plan attached hereto as
Exhibit "B" and made a part hereof. In addition, Landlord shall lease to Tenant
the balance of the Building consisting of approximately Twenty-nine Thousand
Eight Hundred Ninety-two (29,892) square feet (the "Temporary Space") as more
particularly depicted on the plan attached hereto as Exhibit "B-1" and made a
part hereof.
1.2 Common Areas. Tenant, its employees, customers, licensees and
invitees, shall have a non-exclusive license and right to use, in common with
Landlord and all tenants of the Building and their respective employees,
customers, licensees and invitees, all parking areas, access roads, truck ways,
driveways, loading docks and areas, sidewalks, ramps, landscaped areas,
hallways, stairways and other areas, facilities and improvements which may be
provided by Landlord for the general use in common of tenants of the Building
and their employees, customers, licensees and invitees (collectively, the
"Common Areas").
ARTICLE II
TERM
2.1 Term. The term of this Lease shall be for a period of five (5) years
commencing on the Commencement Date (as hereinafter defined) and ending on the
last day of the fifth (5th) Lease Year (as hereinafter defined) thereafter for
the Premises, and for a six (6) month period ending February 28, 1999 for the
Temporary Space.
<PAGE> 2
Thousand Two Hundred Fifty Seven dollars ($67,257.00) on the first day of each
and every calendar month during year Two (2) of the Lease;
3.1.4 the sum of Eight Hundred Thirty Six Thousand Nine Hundred Seventy
Six and 00/100 dollars ($836,976.00), payable in fixed monthly installments of
Sixty Nine Thousand Seven Hundred Forty Eight and 99/100 dollars ($69,748.00) on
the first day of each and every calendar month during each of years Three (3),
Four (4) and Five (5).
3.2 Additional Charges - Tenant's Proportionate Share. During the term of
this Lease, Tenant shall pay, as additional rent, Tenant's Proportionate Share
(as hereinafter defined) of all (i) Taxes (as defined in Section 4.2 hereof) and
(ii) Operating Expenses (as defined in Section 6.5 hereof). Each month during
the term of the Lease, Tenant shall pay an amount equal to 1/12 of the estimated
amount of Tenant's Proportionate Share of annual Taxes and Operating Expenses.
Such payments shall be considered as additional rent and shall be due each month
along with base rent. At the end of each year during the term of this Lease,
Landlord shall calculate the actual amount of such Taxes and Operating Expenses.
If Tenant's Proportionate Share of annual Taxes and Operating Expenses is
greater than the amount paid to Landlord by Tenant in a given Lease Year,
Landlord will invoice Tenant for the difference and payment will be due within
thirty (30) days of receipt by tenant of Landlord's invoice. If Tenant's
Proportionate Share of annual Taxes and Operating Expenses is lower than the
estimated amounts paid to Landlord by Tenant in a given Lease Year, Landlord
will issue a credit for such amount paid in excess.
For purposes hereof, "Tenant's Proportionate Share" shall mean the total
amount of Taxes and/or Operating Expenses, as the case may be, multiplied by a
fraction, the numerator of which shall be the gross leasable area of the
Premises and the denominator of which shall be the gross leasable area of the
Building. Tenant's initial Proportionate Share shall be one hundred percent
(100%). At the first day of March, 1999 (when Tenant has relinquished the
Temporary Space), Tenant's Proportionate Share shall decrease to sixty-six and
seven tenths percent (66.7%).
3.3 Net Lease. This Lease shall be deemed and construed to be a "Net
Lease," and Tenant shall pay to Landlord, absolutely net throughout the term of
this Lease, the Fixed Rent, and other payments hereunder, free of any charges,
assessments, impositions or deductions of any kind and without abatement,
deduction or set-off, and under no circumstances or conditions, whether now
existing or hereafter arising, or whether beyond the present contemplation of
the parties, shall Landlord be expected or required to make any payment of any
kind whatsoever or be under any other obligation or liability hereunder except
as herein otherwise expressly set forth.
3.4 Place of Payment. All payments of Fixed Rent, and other payments
required to be made to Landlord, shall be in lawful money of the United States
of America and shall be paid to Landlord at its principal place of business
stated on Page 1 of this Lease, or to such other person and/or at such other
place as Landlord may designate from time to time in
3
<PAGE> 3
Proportionate Share of such Taxes to Landlord as provided in Section 3.2 hereof.
4.2.2 For purposes of this Lease, the term "Taxes" shall include (i) all
real estate taxes, general or special assessments, water and sewer rents and
other governmental impositions imposed upon or against the Property, of every
kind and nature whatsoever, extraordinary as well as ordinary, foreseen and
unforeseen, and each and every installment thereof, which shall or may during
the term of this Lease be levied, assessed or imposed upon or against the
Property; (ii) any tax and/or assessment of any kind or nature upon or measured
by or with respect to the rentals payable by Tenant hereunder, either by way of
substitution for or in addition to all or any part of the real estate taxes and
assessments levied or assessed against the Property; and (iii) any costs,
expenses and attorneys' fees incurred by Landlord in connection with the
negotiation of a reduction in the assessed value of the Land and/or Building or
any protest or contest of the Taxes described in clauses (i) or (ii) above.
4.2.3 Provided Landlord does not elect to do so, Tenant may, after written
notice to Landlord, contest the validity or amount of any Taxes by appropriate
legal proceedings; provided, however, that (i) Tenant shall pay Tenant's
Proportionate Share of such Taxes when due unless such legal proceedings shall
operate to suspend the collection of Taxes; (ii) Tenant shall provide such
security as Landlord may reasonably request; (iii) Tenant shall pay all
interest, penalties and expenses in connection therewith; (iv) there shall be no
risk that any portion of the Property shall be subject to forfeiture or
foreclosure as a result thereof; (v) Tenant shall not be in default under any of
the terms or provisions of this Lease during the pendency of such contest; and
(vi) Landlord does not object to Tenant doing so within ten (10) days following
receipt of Tenant's notice of its intention to contest Taxes. Landlord agrees
that it will not object unless Landlord, in its reasonable discretion,
determines that such contest may reasonably result in an increase in Taxes.
ARTICLE V
CONDITION OF PREMISES
5.1 Plans and Specifications. Tenant accepts the Premises and the
Temporary Space in "as-is" condition. Landlord shall be responsible for
structural defects and repairs including repair of the existing water leaks
(particularly in the basement, Exhibit "B," Page 1 of 2).
ARTICLE VI
REPAIRS AND MAINTENANCE
6.1 Landlord's Repairs and Maintenance. Subject to Tenant's obligation to
reimburse Landlord for Tenant's Proportionate Share of Operating Expenses as
provided in Section 6.5 hereof, Landlord shall keep the foundation, outer walls,
roof and structural portions of the Building in good repair (except that
Landlord shall not be obligated to make any repairs to
5
<PAGE> 4
any portion of the Property by reason of work, labor, services or materials
performed or furnished to Tenant in connection with Tenant's Work or any
alterations, additions, or improvements to the Premises by Tenant hereunder. If
any such mechanics' lien shall at any time be filed against the Property, Tenant
shall have the right to contest any and all such liens; provided, however, that
Tenant shall cause the same to be discharged of record by payment, bond, order
of a court of competent jurisdiction or otherwise within thirty (30) days
written notice by Landlord. If Tenant shall fail to cause such lien to be
discharged within such thirty (30) day period, then, in addition to any other
right or remedy, Landlord may, but shall not be obligated to, discharge the same
by paying the amount claimed to be due or by bonding or other proceeding deemed
appropriate by Landlord, and the amount so paid by Landlord and/or all
reasonable costs and expenses, including reasonable attorneys' fees, incurred by
Landlord in procuring the discharge of such lien, together with interest thereon
at the Default Rate from the date paid until repaid by Tenant to Landlord, shall
be deemed to be additional rent for the Premises and shall be due and payable by
Tenant to Landlord on the first day of the next following month.
6.5 Operating Expenses. Throughout the term of this Lease, Tenant shall
pay to Landlord, as additional rent, Tenant's Proportionate Share of all
Operating Expenses incurred by Landlord in the operation of the Property. Tenant
shall pay Tenant's Proportionate Share of such Operating Expenses as provided in
Section 3.2 hereof. Operating Expenses shall include, but not be limited to:
costs of management, not to exceed Five percent (5%) based on Ninety Thousand
(90,000) square feet at Thirteen and 50/100 dollars ($13.50) per square foot or
Sixty Thousand Seven Hundred Fifty and 00/100 dollars ($60,750.00) per year;
cleaning; trash removal; lighting; costs of repairing, maintaining and replacing
all Common Area improvements; repair and maintenance of the Building and all
related improvements on the Property, including, without limitation, structural
and roof repair, gutters, down spouts, snow removal, parking lot striping,
painting, pointing of exterior walls and landscaping; providing security;
providing public liability, property damage, fire and extended coverage and such
other insurance as Landlord deems appropriate on the Building and Property;
total compensation and benefits (including premiums for Workers' Compensation
and other insurance) paid to or on behalf of employees; personal property taxes;
supplies; fire protection and fire hydrant charges; water and sewer charges;
utility charges; licenses and permit fees; reasonable depreciation of equipment
used in operating and maintaining the Property and rent paid for leasing such
equipment; and reasonable reserves for any or all of the foregoing, together
with an administrative fee equal to fifteen percent (15%) of the total of the
foregoing. Any capital improvement costs included in Operating Expenses which
Landlord is required to amortize pursuant to the Internal Revenue Service Code
shall be amortized over the useful life of such item and Tenant shall pay
Tenant's Proportionate Share of the amortized cost charged during the term of
this Lease. Operating Expenses shall not include debt service, Building
depreciation, leasing commissions paid by Landlord or the cost of creating new
space for new tenants within the Property; or repairs or replacements to the
extent proceeds of insurance or condemnation awards are available therefor.
7
<PAGE> 5
reasonable wear and tear.
(b) Tenant shall permit Landlord and its agents on reasonable notice
and at reasonable times to examine the Premises and to show the Premises to
prospective purchasers, mortgagees and/or tenants.
(c) Tenant shall use and occupy the Premises in a careful, safe and
proper manner and shall keep the Premises in a clean, safe and healthy condition
in accordance with all Legal Requirements, and Tenant shall not permit the
Premises to be used for any unlawful purpose, commit any waste thereof or commit
any nuisance.
ARTICLE X
ASSIGNMENT AND SUBLETTING
10.1 Assignment and Subletting. Tenant shall not assign, transfer,
mortgage, or encumber this Lease in whole or in part, nor sublet all or any part
of the Premises, nor suffer or permit the occupation of all or any part thereof
by any other party, without the prior written consent of Landlord, which consent
may be withheld in Landlord's reasonable discretion. Tenant shall have the right
to assign all or part of this Lease to a succeeding NASA contractor, with
Landlord's prior written consent, which consent shall not be unreasonably
withheld. Any assignment, transfer, sale or other transfer, whether by operation
of law or otherwise, voluntary or involuntary, of a controlling interest in
Tenant shall be deemed to be an assignment of this Lease within the meaning of
this Section 10.1. The consent by Landlord to any assignment or subletting shall
not constitute a waiver of the necessity for such consent to any subsequent
assignment or subletting.
10.2 Default by Tenant After Sublease. If the Premises or any part thereof
be subleased or occupied by any person other than Tenant, then in the event of
Tenant's default, Landlord may, and is hereby empowered at any time from and
after the date Landlord shall be entitled to terminate the Lease, re-enter the
Premises or dispossess Tenant under the provisions of Article XV below, to
collect rent from such tenants, subtenants and occupants so long as such default
or any other default shall continue, and to apply the same to the curing of any
default hereunder in any order of priority Landlord may elect, and any
unexpended balance shall be applied by Landlord against any rental obligations
subsequently becoming due.
10.3 Assignee Becomes Liable. Each and every assignee, whether as assignee
or as successor-in-interest of any assignee of Tenant, including any purchaser
of this Lease under a foreclosure of any mortgage, shall immediately be, become
and remain liable for the payment of the Fixed Rent and other charges payable
under this Lease, and for the due performance of every obligation on Tenant's
part to be performed throughout the term of this Lease, and each and every
provision of this Lease applicable to Tenant shall also apply to and bind every
such assignee and purchaser with the same force and effect as though such
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of Tenant's servants, employees, agents, or to any person or persons in or about
the Premises; and Tenant agrees that it will not hold Landlord in any way
responsible or liable therefor and will further indemnify and hold Landlord
harmless from and against any and all claims, liability, penalties, damages,
expenses (including reasonable attorneys' fees) and judgments arising from
injury to persons or property of any nature and also for any matter or thing
growing out of the occupation of the Premises.
12.2 Tenant's Insurance. During the term of this Lease:
12.2.1 Tenant shall maintain comprehensive public liability insurance,
including insurance against the assumed or contractual liability of Tenant
hereunder, to afford protection to the limit for each occurrence of not less
than Two Million Dollars ($2,000,000.00) combined single limit for bodily injury
or death and Five Hundred Thousand Dollars ($500,000.00) for damage to Property.
12.2.2 Tenant shall maintain insurance against fire and such other risks
as are, from time to time, included in standard "all risk" extended coverage
endorsements, including Tenant's trade fixtures and other improvements, stock in
trade, furniture, furnishings, special equipment, floor and wall coverings and
all other items of personal property of Tenant located on or within the Premises
(collectively, "Tenant's Personal Property"). Such insurance shall be in an
amount equal to not less than one hundred percent (100%) of the full replacement
cost thereof, without depreciation, and shall include a so-called "agreed
amount" endorsement.
12.2.3 Tenant shall also maintain such other insurance as Landlord (or
Landlord's mortgagee) may reasonably require from time to time in connection
with Tenant's use and occupancy of the Premises. Such additional insurance shall
be carried in such amounts and with such insurance companies as may be
reasonably acceptable to Landlord (and Landlord's mortgagee).
12.2.4 The policies carried by Tenant hereunder shall name Landlord (and
Landlord's mortgagee) as an additional insured, and such policies shall provide
that no cancellation, reduction or other material changes therein shall be
effective until at least thirty (30) days after mailing of written notice
thereof to Landlord (and Landlord's mortgagee). Each such policy, or a
certificate thereof, shall be deposited with Landlord by Tenant not later than
the Commencement Date, and prior to the expiration or termination of any such
policies.
12.3 Waiver of Subrogation. Each insurance policy carried by Landlord or
Tenant and insuring all or any part of the Property or Tenant's Personal
Property shall be written in a manner to provide that the insurance company
waives all right of recovery by way of subrogation against Landlord or Tenant,
as the case may be, including any claim for negligence, in connection with any
loss or damage to the Property, Tenant's Personal Property or business, caused
by any of the perils covered by fire and extended coverage
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Landlord shall restore the Premises to their former condition within the time
specified in such notice.
13.1.3 In the event that Tenant is deprived of the use of the entire
Premises as a result of destruction or injury and this Lease is not terminated,
then the term of this Lease shall be deemed suspended during the time that
Tenant is actually deprived of the use of the Premises (the "Suspension
Period"), and the term of this Lease shall be extended by a number of days equal
to the Suspension Period. In such event, the parties shall enter into an
appropriate amendment to this Lease setting forth the new date that this Lease
will terminate by effluxion.
13.2 Damage at End of Term. If the Premises and/or the Building are
destroyed or damaged during the last two (2) years of the Term of this Lease to
the extent of fifty percent (50%) or more of the then value of the Premises
and/or the Building, then Landlord shall have the right to cancel and terminate
this Lease as of the date of such damage or destruction by giving notice thereof
within thirty (30) days after the date of said damage or destruction.
ARTICLE XIV
CONDEMNATION
14.1 Total Taking. If the whole of the Premises shall be taken under power
of eminent domain by any public or private authority, or conveyed by Landlord to
said authority in lieu of such taking, then this Lease shall terminate as of the
date of such taking.
14.2 Partial Taking. Landlord may, at its election, terminate this Lease
upon the occurrence of any condemnation, or conveyance in lieu of condemnation,
which affects twenty-five percent (25%) or more of the floor area of the
Premises and/or fifty percent (50%) or more of the floor area of the Building.
Upon the occurrence of such event, Landlord shall give Tenant notice of such
election within thirty (30) days after receipt of notice of such pending
condemnation. If Landlord fails to give Tenant such written notice within such
thirty (30) day period, Landlord shall be conclusively deemed to have elected
not to terminate this Lease. Notwithstanding any termination of this Lease
hereunder, Tenant, at its election, may continue to occupy the Premises, subject
to the terms and provisions of this Lease, for the period between the date of
such taking and the date when possession of the Premises shall be taken by the
appropriate authority.
14.3 Restoration. If, upon any condemnation of the Premises and/or the
Building this Lease is not terminated as set forth in this Article XIV, Landlord
shall restore the Premises to an architectural unit as nearly like its condition
prior to such taking as shall be practicable, and if during and/or after such
restoration, Tenant is deprived of the use of all or any part of the Premises,
Fixed Rent shall be abated in accordance with the time during which and the
extent to which Tenant is deprived of the use of the Premises.
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upon such terms as Landlord in Landlord's sole discretion may determine.
Landlord may make repairs, alterations and additions in and to the Premises and
redecorate the same to the extent deemed by Landlord necessary or desirable and
Tenant, upon demand in writing, shall pay the reasonable cost thereof together
with Landlord's expenses of re-letting, including any commissions and attorneys'
fees relative thereto. If the rents collected by Landlord upon any such
re-letting are not sufficient to pay monthly the full amount of the monthly rent
and other charges reserved herein, together with the reasonable costs of such
repairs, alterations, additions, redecorating, and expenses, Tenant shall pay to
Landlord the amount of each monthly deficiency upon demand in writing.
15.3 Damages. Tenant agrees to be liable for and to pay to Landlord (i)
all rent and other charges and sums due under this Lease at the time of
termination of this Lease or upon the termination of Tenant's right of
possession, as the case may be, and (ii) damages equal to the amount of the rent
and all other charges and sums due under this Lease for the entire term, which
damages shall be payable at such time as this Lease or Tenant's right to
possession is terminated. Such liability shall survive the termination of this
Lease, the reentry into the Premises by Landlord, and the commencement of the
action to secure possession of the Premises. All amounts not paid to Landlord
when due shall bear interest at the Default Rate.
15.4 Landlord's Right to Remove Chattels. Any and all property which may
be removed from the Premises by Landlord in accordance with the terms of this
Lease may be handled, removed, stored or otherwise disposed of by Landlord at
the risk and expense of Tenant, and Landlord in no event shall be responsible
for the preservation or safekeeping thereof. Tenant shall pay to Landlord upon
demand in writing, any and all reasonable expenses incurred in connection with
such removal and all storage charges against such property so long as the same
shall be in Landlord's possession or under Landlord's control. If any property
shall remain in the Premises or in the possession of Landlord and shall not be
retaken by Tenant within a period of ten (10) days from and after the time when
the Premises are either abandoned by Tenant or repossessed by Landlord under the
terms of this Lease, said property shall conclusively be deemed to have been
forever abandoned by Tenant.
15.5 Condition of Premises. If this Lease be terminated for any reason
whatsoever or if Landlord should re-enter the Premises as a result of any breach
of Tenant hereunder without terminating the Lease, Tenant covenants, any other
covenant herein to the contrary notwithstanding (except where this Lease is
terminated following eminent domain proceedings), that (a) the Premises shall
then be in the condition required by all applicable provisions of this Lease,
and (b) Tenant shall perform any covenant contained in this Lease for the making
of any repair, improvement, alteration or betterment to the Premises or for
restoring or rebuilding any part thereof. For the breach of either of the
foregoing obligations Landlord shall be entitled to recover and Tenant shall pay
forthwith, without notice or other
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Lease, the relationship of Landlord and Tenant, Tenant's use or occupancy of the
Premises, and/or any claim of injury or damage arising out of the Premises.
ARTICLE XVI
LANDLORD'S RIGHTS
16.1 Landlord's Right to Perform. If Tenant shall default in the
performance or observance of any agreement or condition in this Lease contained
on its part to be performed or observed and shall not cure such default within
any applicable cure period set forth herein, Landlord may, at its option,
without waiving any claim for damages for breach of agreement, at any time
thereafter cure such default for the account of Tenant, and any amount paid or
any contractual liability incurred by Landlord in so doing shall be deemed paid
or incurred for the account of Tenant and Tenant agrees to immediately reimburse
Landlord therefor and save Landlord harmless therefrom; provided that Landlord
may cure any such default as aforesaid prior to the expiration of said waiting
period, without notice to Tenant, if any emergency situation exists, or after
notice to Tenant, if the curing of such default prior to the expiration of said
waiting period is reasonably necessary to protect the Premises or Landlord's
interest therein, or to prevent injury or damage to persons or property. If
Tenant fails to reimburse Landlord upon demand for any amount paid for the
account of Tenant hereunder, said amount (and all accrued interest thereon)
shall be added to and become due as a part of the next payment of rent due
hereunder, together with interest thereon at the Default Rate.
16.2 Remedies Cumulative. Landlord may restrain any breach or threatened
breach of any covenant, agreement, term, provision or condition herein
contained, but the mention herein of any particular remedy shall not preclude
Landlord from any other remedy it might have, either in law or in equity. The
failure of Landlord to insist upon the strict performance of any one of the
covenants, agreements, terms, provisions or conditions of this Lease or to
exercise any right, remedy or election herein contained or permitted by law
shall not constitute or be construed as a waiver or relinquishment for the
future of such covenant, agreement, term, provision, condition, right, remedy or
election, but the same shall continue and remain in full force and effect. Any
right or remedy that Landlord may have at law, in equity or otherwise upon
breach of any covenant, agreement, term, provision or condition in this Lease
contained upon the part of Tenant to be performed, shall be distinct, separate
and cumulative rights or remedies, and no one of them, whether exercised by
Landlord or not, shall be deemed to be in exclusion of any other.
ARTICLE XVII
SUBORDINATION
17.1 Waiver of Priority.
(a) Landlord reserves the right to demand from Tenant and Tenant
agrees to execute and deliver to Landlord a written subordination and waiver of
priority of Tenant's
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limited to commencement of foreclosure proceedings, if necessary to effect such
cure). This Lease shall not be terminated by Tenant while such remedies and
cures are being so pursued.
ARTICLE XVIII
SIGNS
Tenant shall not erect or install any ground, building, or roof signs
except as permitted by Landlord. All signs installed by Tenant shall comply with
all requirements of appropriate governmental authority, and all necessary
permits or licenses shall be obtained by Tenant. Tenant shall have the right,
subject to Landlord review of Tenant's design, to place their name on the
existing monument sign. Tenant shall maintain all signs in good condition and
repair at all times, and shall save Landlord harmless from injury to person or
property, arising from the erection, installation, and maintenance of said
signs. Upon vacating the Premises, Tenant shall remove all signs and repair all
damage caused by such removal.
ARTICLE XIX
ENVIRONMENTAL
19.1 Investigation. Tenant acknowledges that Landlord has granted to
Tenant the right, prior to the execution of this Lease, to conduct such other
environmental investigations, tests and studies as Tenant may select, it being
agreed and understood that Tenant accepts liability for all environmental issues
which occur during their occupancy of the Premises.
19.2 Tenant's Indemnification. Tenant will indemnify and hold Landlord
harmless from and against any and all loss, cost, damage, liability and expense
(including reasonable attorneys' fees) of whatever kind and nature resulting
from any accident, occurrence or condition caused by the release by Tenant, its
agents, employees, contractors, assignees, sub-lessees, licensees or invitees of
any hazardous or toxic substance or waste in, on, under, about or affecting the
Premises, the Building or the Land which results in any injury or death to any
person or damage to any property or which requires the removal or treatment of
such hazardous or toxic substance or waste or other remedial action or fine
under the terms of any properly constituted law, regulation, rule or directive
of any federal, state or local governmental authority.
19.3 Landlord's Indemnification. Landlord will indemnify and hold Tenant
harmless from and against any and all loss, cost, damage, liability and expense
(including reasonable attorneys' fees) of whatever kind and nature resulting
from any accident, occurrence or condition caused by the release by Landlord,
its agents, employees, contractors and assignees of any hazardous or toxic
substance or waste in, on, under, about or affecting the Premises, Building or
Land which results in any injury or death to any person or damage to any
property or which requires the removal or treatment of such hazardous or toxic
substance or
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21.2 Waivers. Failure of Landlord to complain of any act or omission on
the part of Tenant, no matter how long the same may continue, shall not be
deemed to be a waiver by Landlord of any of its rights hereunder. No waiver by
Landlord at any time, express or implied, of any breach of any provision of this
Lease shall be deemed a waiver of a breach of any other provision of this Lease
or a consent to any subsequent breach of the same or any other provision. If any
action by Tenant shall require the consent or approval of Landlord, Landlord's
consent to or approval of such action on any one occasion shall not be deemed a
consent to or approval of said action on any subsequent occasion or a consent to
or approval of any other action on the same or any subsequent occasion.
21.3 Notices. All notices and other communications authorized or required
hereunder shall be in writing and shall be given by mailing the same by
certified mail or registered mail, return receipt requested, postage prepaid,
and any such notice or other communication shall be deemed to have been given
when received by the party to whom such notice or other communication shall be
addressed, or on the date noted that the addressee has refused delivery or on
the date that the notice is returned to sender due to the inability of the
postal authorities to deliver. Notices shall be mailed to the address
hereinabove set forth or such other address as either party may hereafter
designate by notice to the other.
21.4 Attorneys' Fees. If either party hereto be made or becomes a party to
any litigation commenced by or against the other party involving the enforcement
of any of the rights and remedies of such party, or arising on account of the
default of the other party in the performance of such party's obligations
hereunder, then the prevailing party in any such litigation, or the party
becoming involved in such litigation because of a claim against such other
party, as the case may be, shall receive from the other party all costs and
reasonable attorneys' fees incurred by such party in such litigation.
21.5 Force Majeure. In the event that Landlord or Tenant shall be delayed
or hindered in or prevented from the performance of any act (other than Tenant's
obligation to make payments of Fixed Rent and other charges required hereunder),
by reason of strikes, lockouts, unavailability of materials, failure of power,
restrictive governmental laws or regulations, riots, insurrections, the act,
failure to act, or default of the other party, war or other reason beyond its
control, then performance of such act shall be excused for the period for the
delay and the period of the performance of such act shall be extended for a
period equivalent to the period of such delay. Notwithstanding the foregoing,
lack of funds shall not be deemed to be a cause beyond control of either party.
21.6 Estoppel Certificates. At any time and from time to time upon
Landlord's written request, Tenant will execute, acknowledge and deliver to
Landlord a certificate certifying that:
(a) the Lease is in full force and effect;
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Lease or any modification or amendment thereof or extensions or renewals
thereof, except for such liabilities which might have accrued prior to the date
of such sale or transfer of Landlord's interest. Landlord shall be liable under
this Lease only while owner of the Premises.
(b) Notwithstanding anything herein contained to the contrary, if
Landlord shall at any time be in default of its obligations hereunder, Tenant
shall not exercise any of its remedies for such default unless Tenant shall have
given Landlord written notice thereof (but Landlord shall not be deemed in
default if such default cannot reasonably be cured in thirty [30] days and
Landlord commences to remedy such default within said thirty [30] day period and
proceeds therewith with due diligence until completion); provided, however, if
Landlord's default has created an emergency situation requiring immediate
corrective action to protect property or persons from damage or injury, Tenant
shall be permitted to take reasonable corrective action at Landlord's expense
prior to such notice provided Tenant has used its best efforts to give Landlord
verbal notice and Landlord has not promptly responded.
(c) If Landlord shall fail to perform any covenant, term or
condition of this Lease upon Landlord's part to be performed or if Landlord
shall be liable to Tenant in any way arising out of this Lease, or pursuant to
statute, law, ordinance or regulation, or under the common law, and, as a
consequence, if Tenant shall recover a money judgment against Landlord, such
judgment shall be satisfied only out of the proceeds received at a judicial sale
upon execution and levy against the right, title and interest of Landlord in the
Premises. If Landlord is an individual, a trustee of a trust or a partnership,
Landlord's obligations hereunder shall not be binding upon, nor shall there be
any personal liability by, Landlord individually, the trustees of said trust,
the beneficiaries of said trust, the partnership, or the partners of the
partnership.
21.12 Memorandum of Lease. This Lease shall not be recorded; however,
Landlord and Tenant shall, upon the request of either, execute and deliver a
Memorandum of Lease setting forth such information as may be necessary to
constitute a "short form lease", which the party requesting the recording, at
its sole expense, cause to be recorded in the County Recorder's Office having
jurisdiction over the Premises within thirty (30) days after the execution of
said Memorandum of Lease.
21.13 Brokers. Landlord and Tenant represent and warrant that they have
not dealt with any real estate broker in connection with this Lease other than
Thomas M. West of Colliers International whose commission shall be paid by
Landlord. Commission equal to two (2%) percent of base total rent payable to
Landlord during initial five (5) year lease term such commission to be paid for
the intial two year lease term by Oct. 30, 1998 and, provided Tenant excluding
the first 4 months of the lease has not exercised any right to cancel, for the
balance by August 30, 2001.
Except as aforesaid, Landlord and Tenant agree to indemnify and hold each
other harmless from all liabilities arising from any claim resulting from their
having dealt with any broker in connection with this Lease.
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STATE OF OHIO )
) SS.
COUNTY OF CUYAHOGA )
BEFORE ME, a Notary Public in and for said County and State, personally
appeared the above named TechPark Limited Partnership, an Ohio limited
partnership, by TechPark Development, its general partner, by IJC TechPark
Corporation, its general partner, by Kerry Chelm, its President, who
acknowledged that he did sign the foregoing instrument and that the same is the
free act and deed of said partnership and his free act and deed personally and
as such partner.
IN WITNESS WHEREOF, I have hereunto set my hand, this 29 day of October
___, 1998.
/s/ Nancy Lynn Cook
----------------------------------------
NOTARY PUBLIC
NANCY LYNN COOK
NOTARY PUBLIC, STATE OF OHIO
Recorded in Cuyahoga County
My Comm. Expires May 7, 2003
CORPORATE ACKNOWLEDGMENT
STATE OF FLORIDA )
) SS.
COUNTY OF PINELLAS )
BEFORE ME, a Notary Public in and for said County and State, personally
appeared Dynacs Engineering Company, Inc., a Florida corporation, by Javier
Benavente, its ___ General Manager who acknowledged that [he/she] did sign the
foregoing instrument and that the same is the free act and deed of said
Corporation and [his/her] free act and deed personally and as such General
Manager.
IN WITNESS WHEREOF, I have hereunto set my hand, this 22nd day of October
__, 1998.
/s/ Judy Ann Hess
----------------------------------------
NOTARY PUBLIC
----------------------------------------
JUDY ANN HESS
Notary Public - State of Florida
My Commission Expires Jul 15, 2001
Commission # CC663744
----------------------------------------
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[GRAPHIC OMITTED]
BASEMENT FLOOR PLAN
<PAGE> 15
[GRAPHIC OMITTED]
SECOND FLOOR PLAN
<PAGE> 1
Exhibit 10.19
TABLE OF CONTENTS
Page
1. Terms and Definitions ................................................. 1
2. Uses .................................................................. 2
3. Rent .................................................................. 2
4. Deposit ............................................................... 3
5. Utilities ............................................................. 3
6. Building Services ..................................................... 4
7. Insurance: Indemnity .................................................. 4
8. Waiver of Subrogation ................................................. 5
9. Repairs ............................................................... 5
10. Tenant's Property ..................................................... 5
11. Alterations by Tenant ................................................. 5
12. Assignment: Subletting ................................................ 6
13. Liens ................................................................. 6
14. Relocation ............................................................ 6
15. Casualty .............................................................. 7
16. Condemnation .......................................................... 7
17. Construction Conditions ............................................... 7
18. Occupancy: Lease Commencement Date .................................... 8
19. Rules and Regulations ................................................. 9
20. Parking ............................................................... 9
21. Access ................................................................ 9
22. Signs ................................................................. 9
23. Tenant's Default ...................................................... 10
24. Quiet Enjoyment ....................................................... 11
25. Inability to Perform. ................................................. 11
26. Hold Over Tenancy ..................................................... 11
27. Amendment: Waiver ..................................................... 11
28. Notices ............................................................... 11
29. Schedules: Exhibits ................................................... 12
30. Limitation of Landlord's Liability .................................... 12
31. Landlord's Reserved Rights ............................................ 12
32. Estoppel Certificate .................................................. 12
33. Accord and Satisfaction ............................................... 13
34. Severability .......................................................... 13
35. Subordination ......................................................... 13
36. Default Interest ...................................................... 13
37. Time .................................................................. 13
38. Applicable Law ........................................................ 13
39. Broker Indemnification ................................................ 13
40. Binding Effect: Gender ................................................ 13
41. Radon Gas ............................................................. 14
Signature Page ........................................................ 14
Schedule 1 - Estimated Operating Costs
Schedule 2 - Utility Services (provided to the Leased Premises)
Schedule 3 - Building Services, Rules and Regulations
Exhibit A - Leased Premises
Exhibit B - Floor Plan
Exhibit C - Scope of Work
<PAGE> 2
LEASE
This Lease is made between Dynacs Engineering Company Inc. ("Tenant") and
Dynacs Properties, Inc. ("Landlord"), as of the 1st day of January, 1999.
1. TERMS AND DEFINITIONS
A. "Leased Premises" shall mean suite 2.2 on the first floor, suite 4
on the second floor, suite 10, 11, and 12 on the third floor,
collectively referred to herein as suite 300, as described in
"Exhibit A" attached hereto and made a part hereof.
B. "Building" shall mean the building located at 35111 U.S. Hwy 19
North, Palm Harbor, Florida 34684.
C. "Project" shall mean that parcel of land with all of the
improvements thereon identified by its tax number
31/27/16/00000/420/0310, and more commonly known by its street
address given in 1. B. above.
D. "Tenant's Square Footage" shall mean approximately 6,312 rentable
square feet; "Total Square Footage" shall mean approximately 30,330
square feet.
E. "Lease Commencement Date" shall mean January 1, 1999, which may be
adjusted pursuant to Paragraph 18 below; "Lease Termination Date"
shall mean December 31, 2003; "Lease Term" shall mean the period
between the Lease Commencement Date and the Lease Termination Date.
F. "Base Rent" shall mean the following for each successive lease year,
plus applicable sales tax:
Lease Year Annual Base Rent Monthly Base Rent
1 $ 96,258 $ 8,021/mo. +tax
2 $ 100,108 $ 8,342/mo. +tax
3 $ 104,112 $ 8,676/mo..+tax
4 $ 108,277 $ 9,023/mo. +tax
5 $ 112,608 $ 9,384/mo. +tax
G. "Estimated Operating Costs" shall mean $5.92 per square foot of
Total Square Footage per year, subject to adjustment pursuant to
Paragraph 3 below; "Operating Cost Stop" shall mean actual operating
expenses for calendar year 1999 "Tenant's Pro Rata Share" shall mean
20.81%.
H. "Deposit" shall be $A.
I. "Floor Plan" see "Exhibit B"
J. "Scope of work" see "Exhibit C"
K. "Improvement Allowance" D.P.I. borrowed $75,000 which was used by
Dynacs Engineering Company Inc. for the build out of their space.
The principal and interest on this loan is to be paid by Dynacs
Engineering Company Inc. to D.P.I. monthly, in addition to this
lease, until paid in full.
L. "Permitted Purpose" shall mean general office uses.
M. "Authorized Number of Parking Spaces" shall mean 20 spaces.
N. "Managing Agent" shall mean Dynacs Properties, Inc., whose address
is 35111 U.S. Highway 19
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North, Suite 302, Palm Harbor, Florida 34684.
0. "Broker of Record" shall mean By Owner.
2. USES. Tenant shall use the Leased Premises for the Permitted Purpose only
and for no other purpose. Tenant shall comply with the provisions of all
recorded covenants, conditions and restrictions and all building, zoning,
fire and other governmental laws, ordinances, regulations or rules
applicable to the Lease Premises and all requirements of the carriers of
insurance covering the Project. Tenant shall not do or permit anything to
be done in or about the Lease Premises, or bring or keep anything in the
Lease Premises that may increase Landlord's fire and extended coverage
insurance premium; damage the Building or the Project; constitute waste;
or be a nuisance, public or private, or menace or other disturbance to
tenants of adjoining premises or anyone else.
3. RENT
A. Payment of Rent. Tenant shall pay any sales tax imposed on rentals
as an additional part of Base Rent. All charges, costs and sums
required to be paid by Tenant under this Lease in addition to Base
Rent and Tenant's Pro Rate Share of any Excess Operating Costs shall
be considered additional rent. Base Rent, Tenant's Pro Rata Share of
any Excess Operating Costs and additional rent are referred to
collectively in this Lease as "Rent". Rent shall be payable without
demand, notice, offset for deduction, except as otherwise
specifically stated in this Lease. All Rent due under this Lease
shall be paid by checks payable to the order of Dynacs Properties,
Inc., which checks shall be mailed or delivered at the office of the
Managing Agent, or in such other manner or at such other place as
Landlord may from time to time designate in a written notice to
Tenant. Base Rent will be prorated for partial months or years
within the Term. Tenant's covenant to pay Rent shall be independent
of every other covenant in this Lease. Tenant shall pay a late
charge of $50 with each late payment of Rent.
B. Excess Operating Costs. Tenant shall pay Tenant's Pro Rata Share of
any Excess Operating Costs as follows:
(1) "Operating Costs" shall mean all expenses relating to the
Leased Premises, the Building or the Project, including but
not limited to: real estate taxes and assessments; gross
rents, sales, use, business, corporation, franchise or other
taxes (except income taxes); utilities not separately paid by
tenants; insurance premiums and (to the extent used)
deductibles; maintenance repairs and replacements;
refurbishing, redecorating and repainting; cleaning,
janitorial and other services; equipment, tools, materials and
supplies; air conditioning, heating and elevator services;
property management; security; employees and contractors;
resurfacing and restriping of walks, drives and parking areas;
signs, directories and markers; landscaping; and rubbish
removal.
Operating Costs shall not include expenses attributable to any
tenant under a net lease or similar arrangement, nor shall
operating costs include expenses for legal services, income
tax accounting, interest, depreciation, general corporate
overhead, or capital improvements, except to the extent that
any such expense reduces any item of Operating Costs (in which
case, the amount of such reduction, as determined by Landlord,
shall be included in Operating Costs each year until such
expense is recouped) or is required by any governmental or
other authority having or asserting jurisdiction over the
Project (in which case, the amount of such expense
attributable to each year, as determined by Landlord, shall be
included in Operating Costs each year until such expense is
recouped).
If the building occupancy is less that 95% during any portion
of any year, the components
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of Operating Costs which vary upon the occupancy level of the
building shall be increased to the amount that would have
been paid or incurred had the building been occupied to 95%
at all times during such year and such increases shall be
included in Operating Costs for such year.
(2) Tenant shall pay, in equal monthly installments, Tenant's Pro
Rata Share of any Excess Operating Costs for each calendar
year which falls (in whole or in part) during the Lease Term
(prorated for any partial calendar year at the beginning or
end of the Lease Term). For the purposes of this Paragraph,
"Excess Operating Costs" shall mean any excess of Estimated
Operating Costs multiplied by Total Square Footage over the
Operating Cost Stop multiplied by the Total Square Footage.
Schedule 1 attached hereto and made a part hereof sets forth
Landlord's good faith determination of Estimated Operating
Costs for the calendar year in which the Lease Commencement
Date falls. Annually or from time to time, based on actual and
projected Operating Costs data, Landlord may adjust Estimated
Operating Costs upward or downward and may revise Schedule 1
accordingly. All monthly installments are due 15 days after
notice to Tenant of a revised Schedule 1 and shall be in equal
amounts sufficient to result in the unpaid balance of Tenant's
Pro Rata Share of any Excess Operating Costs (as adjusted)
being paid in full by the end of each calendar year. The
estimate set forth in Schedule 1 or any revision thereof shall
not be binding upon Landlord, and shall not limit in any way
Tenant's obligation to pay Tenant's Pro Rata Share of any
Excess Operating Costs (as may be adjusted pursuant to this
Subparagraph), or to pay any year-end settlement of actual
Operating Costs pursuant to Subparagraph (3) below.
(3) By April 15 of each year, Landlord shall compute the actual
Operating Costs for the prior calendar year, and shall give
notice thereof to Tenant. Within 30 days after such notice,
Tenant shall pay any deficiency in Tenant's Pro Rata Share of
any Excess Operating costs for the prior calendar year
(prorated for any partial calendar year at the beginning or
end of the lease Term). For purposes of this Paragraph,
"Excess Operating Costs" shall mean any excess of actual
Operating Costs for any calendar year over the Operating Costs
Stop multiplied by the Total Square Footage. In the event of
overpayment by Tenant, Landlord shall apply the overpayment to
the Tenant's future rents until such overpayment by Tenant is
exhausted (or until no further payments of Rent are due, in
which case, Landlord shall pay to Tenant the balance of such
excess within 30 days thereafter).
(4) The obligations of Tenant to pay any deficiency in Tenant's
Pro Rata Share of Excess Operating Costs provided for in this
Paragraph 3, shall expressly survive the expiration or
termination of this Lease. Tenant shall pay any deficiency in
Tenant's Pro Rata Share of Excess Operating Costs owed to
Landlord within fifteen (15) days after the date of Landlord's
statement for the calendar year in which this Lease expires or
terminates.
(5) Notwithstanding anything herein to the contrary, Tenant's Pro
Rata Share of Excess Operating Costs, excluding such as are
attributable to real estate taxes or insurance, shall not
increase by more than five (5%) percent per annum.
4. DEPOSIT. Tenant has paid to Landlord the Deposit as security for
performance of Tenant's obligations. In the event Tenant fully complies
with all the terms and conditions of this Lease, but not otherwise, the
Deposit shall be refunded to Tenant, without interest (except as may be
required by law), upon expiration of this Lease. Landlord may, but is not
obligated to, apply all or a portion of the Deposit to cure any default
hereunder, and Tenant shall pay on demand the amount necessary to restore
the Deposit in full.
5. UTILITIES. Landlord shall provide to the Leased Premises the Utility
Services listed on Schedule 2 attached hereto and made a part hereof
("Utility Services"). The cost of Utility Service shall be part of
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Operating Costs. However, if Tenant, in Landlord's reasonable judgment,
makes unusual or excessive Utility Services demand, Landlord may, at
Tenant's sole expense, install a separate utility meter and make
additional charges according to applicable utility rates, which Tenant
shall pay to Landlord on demand. Also, separate additional charges may be
made to Tenant, if demands where such services are not separately metered.
In any event, Landlord shall not be liable, nor shall Rent be abated,
because of any interruption or cessation of Utility Services, unless such
interruption or cessation results from Landlord's negligence or
misconduct. A particular Tenant's lease may require a Tenant to pay for
all or some of the Utility Services provided to its leased premises.
Schedule 2 attached to this Lease identifies those Utility Services which
the Tenant shall pay separate and above the base rent and Excess Operating
Cost and shall take precedent over inconsistent language contained herein.
6. BUILDING SERVICES. Landlord agrees to maintain all parking and exterior
areas, which maintenance shall include lighting, landscaping, cleaning and
painting. Landlord shall maintain and repair the exterior of the Building
and its structural portions and roof. In addition, Landlord shall provide
all of the building services described in Schedule 2 attached hereto and
made a part hereof (all of the services described in this Paragraph 6 and
Schedule 2 shall be referred to sometimes as "Building Services"). The
cost of Building Services shall be part of Operating Costs. In any event,
Landlord shall not be liable, nor shall Rent be abated, because of any
interruption or cessation of Building Services.
7. INSURANCE: INDEMNITY.
A. Landlord's Insurance. Landlord may, but shall not be obligated to,
procure and maintain such insurance with respect to the Building
and/or the Project as Landlord may determine in its sole discretion
to be appropriate, including but not limited to: fire insurance with
extended coverage endorsements in the amount of the full insurable
value of the Building and the Project; comprehensive public
liability insurance for personal injury or death, property damage
and other loss; rent abatement insurance; and such other insurance
as may be maintained from time to time by first class building
owners and managers in the general area. The cost of insurance shall
be part of Operating Costs.
B. Tenant's Insurance. Tenant shall, at its own expense, procure and
maintain throughout the Lease Term:
(1) Comprehensive public liability insurance with respect to the
Leased Premises and Tenant's activities therein and
thereabout, insuring against liability for personal injury or
death, property damage or other loss, with deductibles of not
more than $1,000 and in amounts no less than;
(a) $1,000,000 with respect to personal injury or death to
any one person;
(b) $5,000,000 with respect to personal injury or death
arising out of any one occurrence;
(c) $1,000,000 with respect to property damage or other loss
arising out of any one occurrence.
(2) Worker's compensation insurance in at least the statutory
amounts.
Tenant's insurance shall be with a Best's A+ rated company (or
A rated, if Class XIII or larger). Landlord and Landlord's
mortgagee, if any, shall be named as additional insured under
Tenant's insurance, and such insurance shall be primary and
non-contributing with any insurance carried by Landlord.
Tenant's insurance policies shall contain endorsements
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requiring 30 days notice prior to termination or any reduction
in amount of coverage. Tenant shall deliver to Landlord as a
condition precedent to its taking occupancy of the Leased
Premises (but not to its obligation to pay Rent) a certificate
or certificates evidencing such insurance. Tenant shall
deliver certificates evidencing such insurance upon annual
policy renewals during each year of the Lease Term or as may
be reasonably requested by Landlord.
C. Indemnification. Tenant hereby indemnifies and agrees to save
harmless Landlord, its officers, directors, employees and agents
from and against all claims, actions, fines, damages, liability,
cost and expense, including reasonable attorney's fees excluding
those arising from Landlord's negligence or misconduct, that arise
from, or are in connection with, the possession, use, occupancy, or
control of the Leased Premises, or any portion thereof, or as a
result of any breach by Tenant, its agents, employees, officers,
contractors, licensees or invitees of the terms or covenants of this
Lease or any other acts or omissions of Tenant, its agents,
employees, officers, contractors, licensees or invitees. Tenant
shall, at its own cost and expense, defend any and all actions,
suits, and proceedings which may be brought against Landlord with
respect to the foregoing, excluding those arising from Landlord's
negligence or misconduct.
D. Waiver. Tenant, as a material part of the consideration to be
rendered to Landlord, hereby waives all claims against Landlord for
personal injury or death, property damage or other loss to Tenant,
its agents, employees, officers, contractors, licensees, invitees or
third persons in or about the Leased Premises from any cause arising
at any time.
8. WAIVER OF SUBROGATION. Tenant and Landlord release each other and waive
any right of recovery against each other for loss or damage to their
respective property, which occurs in or about the Lease Premises (whether
due to the negligence of either party, their agents, employees, officers,
contractors, licensees, invites or otherwise), to the extent that such
loss or damage is reimbursed by insurance proceeds. Tenant and Landlord
agree that all policies of insurance obtained by either of them in
connection with the Leased Premises shall contain appropriate waiver of
subornation clauses.
9. REPAIRS. Tenant agrees to maintain in a neat, clean and sanitary
condition, and keep in good repair, the interior of the Leased Premises,
but Tenant shall not be responsible for Building Services provided by
Landlord. Tenant maintenance and repair shall be at the sole cost of
Tenant and shall include, but not be limited to, the maintenance and
repair of floor coverings, ceilings and walls, front and rear doors, and
all glass on the Leased Premises. If Tenant fails to maintain or keep the
Leased Premises in good repair and such failure continues for 5 days after
written notice from Landlord, Landlord may perform any such required
maintenance and repairs and the costs thereof shall be Rent payable by
Tenant within 10 days of receipt of any invoice from Landlord.
10. TENANT'S PROPERTY. Furnishings, trade fixtures and equipment installed by
Tenant shall be the property of Tenant subject to Paragraph 24 below. On
expiration of this Lease, if there is then no Event of Default (as defined
in Paragraph 23 below), Tenant may remove any such property and shall
repair the Leased Premises to the same condition as when the lease Term
commenced, ordinary wear and tear excepted, or reimburse Landlord for the
cost of so repairing the Leased Premises. If Tenant fails to remove such
property as required under this Lease, Landlord may do so and keep and use
or dispose of the same in its sole discretion without any liability to
Tenant on account thereof, and further may charge the cost of any such
removal, storage or disposition to Tenant.
11. ALTERATIONS BY TENANT. Tenant may make such additional alterations or
improvements to the Leased Premises which it may deem necessary or
desirable, but only with Landlord's prior written approval. Any such
alterations or improvements by Tenant shall be done, at Tenant's expense,
by a licensed contractor approved by Landlord in conformity with plans and
specifications approved by Landlord. If requested by Landlord,
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Tenant or Tenant's contractor will post a bond or other security
reasonably satisfactory to Landlord to protect Landlord against liens
arising from work performed by Tenant. All work performed shall be done in
a good and workmanlike manner and with materials (where not specifically
described in the specifications) of the quality and appearance comparable
to those in the Building, and shall become the property of Landlord. At
Landlord's option, Tenant shall contract with Landlord for the
construction of such alterations or improvements, but only if Landlord's
price for such work is not excessive.
12. ASSIGNMENT: SUBLETTING
A. Consent. Tenant shall not, directly or indirectly, assign or sublet
under this Lease or any part thereof, or permit all or any part of
the Leased Premises to be used or occupied by another, without first
obtaining the written consent of Landlord. Any mortgage, pledge or
assignment of this Lease, or if Tenant is a corporation, any
transfer or this Lease from Tenant by merger, consolidation,
reorganizations or liquidation shall constitute an assignment for
the purposes of this Paragraph. Any assignment or subletting made
without Landlord's prior written consent shall be voidable by
Landlord, if such consent was not unreasonably withheld. Any consent
by Landlord, unless specifically stated therein, shall not relieve
Tenant from its obligations under this Lease.
B. Conditions for Consent. Landlord may withhold its consent to any
assignment or subletting on any reasonable basis. Without limiting
the generality of the foregoing, Landlord shall be deemed to be
reasonable in withholding its consent to any assignment or
subletting, if such assignment or subletting would be:
To any party, whether or not said party is then a lessee of
the Project, at a time when occupancy is (as of the
commencement date of such assignment or subletting) less than
90% of Total Square Footage, if Landlord has or will have
during the ensuing six months suitable space for rent in the
Project; or
C. Sub-Lease Rentals. The Tenant shall remain obligated to the Landlord
for the full amount of the lease and additional rents provided
herein, in the event the Tenant assigns or sublets a portion or all
of the Leased Premises.
D. Termination. Within 20 days after receipt of any request by Tenant
for consent to any assignment or subletting, Landlord may elect, by
written notice to Tenant, to terminate this Lease without cause as
to that part of the Leased Premises subject to the proposed
assignment or subletting, effective as of the commencement date of
the proposed assignment or subletting.
13. LIENS. Tenant shall keep the Leased Premises, the Building and the Project
free from liens arising out of any work performed, materials furnished or
obligations incurred by or for Tenant. If at any time a lien or
encumbrance is filed against the Leased Premises, the Building or the
Project as a result of Tenant's work, materials or obligations, Tenant
shall promptly discharge said lien or encumbrance, and if said lien or
encumbrance has not been removed within 15 days from the date it is filed,
Tenant agrees to transfer said lien to a bond in accordance with Florida
law and to pay all cost and attorney's fees associated with the transfer
of the lien to a bond and the defense of any action arising therefrom.
This paragraph does not apply to work done by the Landlord for the
improvement of Tenant's space.
14. RELOCATION. Landlord shall have the right at any time, notwithstanding
anything contained herein to the contrary, to relocate at Landlord's
expense the Leased Premises on any floor of the Building or elsewhere in
the Project, provided that Tenant's Square Footage shall not be
substantially reduced and the new premises are reasonably acceptable to
Tenant. Rent shall be changed because of the relocation of the Leased
Premises, notwithstanding any change in Tenant's Square Footage. Should
Landlord give Tenant written notice of the
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relocation of the Leased
Premises after Tenant has commenced or completed the approved installation
of partitioning or other improvements, Landlord shall furnish Tenant with
similar partitioning or other improvements of equal quality. The
relocation of the Leased Premises shall not affect any of the other
clauses or conditions of this Lease.
15. CASUALTY. If the Lease Premises are destroyed or damaged by fire,
earthquake or other casualty, then Landlord may, at Landlord's option,
proceed with reasonable diligence to rebuild and restore the Leased
Premises, provided that within 60 days after such destruction or damage
Landlord shall in writing notify Tenant of Landlord's intention to do so,
and during the period of such rebuilding and restoration, this Lease shall
remain in full force and effect, and Base Rent and Tenant's Pro Rata Share
of any Excess Operating Costs shall be abated in the same ratio as the
square footage in the portion of the leased Premises rendered
untenantable, if any, shall bear to Tenant's Square Footage, if Landlord
shall reasonably determine that such destruction or damage, it shall so
notify Tenant within 60 days after occurrence of such destruction or
damage. In such event, either Landlord or Tenant may within 20 days after
such notice, terminate this Lease. If neither party terminates this Lease
during such 20-day period, this Lease shall remain in effect and Landlord
shall diligently proceed to rebuild and restore the Leased Premises, and
Base Rent and Tenant's Pro Rata Share of any Excess Operating Costs shall
abate as set forth above.
16. CONDEMNATION. If all or any part of the Lease Premises shall be taken
under power of eminent domain or like power, or sold under imminent threat
thereof to any public authority or private entity having such power, this
Lease shall terminate as to the part of the Leased Premises so taken or
sold, effective as of the date possession is required to be delivered to
such authority or entity. Rent for the remaining Lease Term shall be
reduced in the proportion that Tenant's Square Footage is reduced by the
taking. If a partial taking or sale of the Leased Premises, the Building
or the Project
(i) substantially reduces Tenant's Square Footage resulting in a
substantial inability of Tenant to use the Leased Premises for
the Permitted Purpose, or
(ii) renders the Building or the Project commercially unviable to
Landlord (in Landlord's sole opinion), Tenant in the case of
(i), or Landlord in the case of (ii), may terminate this Lease
by notice to the other party within 30 days after the
terminating party receives written notice of the portion to be
taken or sold, such termination to be effective 180 days after
notice thereof, or when the portion is taken or sold,
whichever is sooner. All condemnation awards and similar
payments shall be paid and belong to Landlord, except any
amounts awarded or paid specifically for Tenant's trade
fixtures and relocation costs (provided such awards do not
reduce Landlord's award). Without limiting the generality of
the foregoing, leasehold interest shall be paid and belong to
Landlord, and Tenant shall execute any assignment or other
documentation requested by Landlord to effectuate such award
or payment.
17. CONSTRUCTION CONDITIONS
A. Improvements. Landlord shall improve the Leased Premises in
accordance with Floor Plan attached hereto and made a part hereof as
"Exhibit B" the Scope of Work attached hereto and made a part hereof
as "Exhibit C". Landlord shall bear the expenses associated with
improving the Leased Premises, including, but not limited to,
architecture fees, engineering fees and construction expenses, but
only to the extent such expenses do not exceed the Improvement
Allowance specified in Paragraph 1.
B. Plans and Scope of Work. The Floor Plan and Scope of Work attached
hereto as Exhibits "B" and "C", respectively, shall be used by
Landlord to design all mechanical and electrical systems required
for construction of the work covered thereby. The architectural,
mechanical and electrical plans for
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the Leased Premises shall be submitted by Landlord to Tenant, and
Tenant shall have three (3) business days to approve such plans in
writing. The Improvement Allowance includes the cost of one (1) set
of preliminary plans, one (1) revision, and one (1) set of final
plans prepared by Landlord's architects and engineers. Tenant shall
bear the cost of any other plans and design services. Where
applicable, Tenant shall select paint colors, carpet and other
matters so as not to delay progress of the work.
C. Conduct of Work. Tenant and Landlord have agreed upon the Floor Plan
an Scope of Work attached hereto as Exhibits "B" and "C",
respectively. A list of the expenses associated with improving the
Leased Premises in accordance with the Floor Plan and Scope of Work
is included in "Exhibit C", Scope of Work. If the total amount of
such expenses exceeds the Improvement Allowance specified in
Paragraph 1, Tenant shall be responsible for payment of the
difference between the total amount of such expenses and the
Improvement Allowance. Tenant shall pay any such amount to Landlord
within 10 days of Landlord's request. Landlord will not commence
with construction until any such amount is paid by Tenant. Tenant's
failure to pay its share of the improvement expenses by the date
specified herein shall not in any manner defer the Lease
Commencement Date or Tenant's Commencement Date, and under such
circumstances Landlord agrees to make the Leased Premises ready for
Tenant's occupancy not later than the Lease Commencement Date plus
the number of days after the date specified herein that Tenant
actually pays Landlord for Tenant's share of the improvement
expenses.
D. Changes. If Tenant, after approving the final plans and
specifications, shall request any changes to such plans and
specifications, the Tenant shall be responsible for any costs
incurred as a result of such changes. Landlord shall advise Tenant
of the estimated cost and time delay resulting from such changes
prior to performing any work thereon. Any delay in completing the
Leased Premises caused by such changes or prospective changes shall
not in any manner affect the Lease Commencement Date, and under such
circumstances, Landlord agrees to make the Leased Premises ready for
Tenant's occupancy not later than the Lease Commencement Date plus
the number of days delay resulting from Tenant's said change or
prospective changes.
E. Tenant's Special Requirements. Any delay in completing the Leased
Premises caused by any special or custom equipment, materials, or
finishes specified by Tenant shall not in any manner defer the
Leased Commencement Date or Tenant's liability for the payment of
Rent from the Lease Commencement Date, and under such circumstances
Landlord agrees to make the Leased Premises ready for Tenant's
occupancy not later than the Lease Commencement Date plus the number
of days delay resulting from said special or custom equipment,
materials and finishes.
F. Risk of Loss. Landlord shall bear the risk of loss to the Leased
Premises until the Lease Commencement Date, but has no obligation to
insure against such loss. Tenant shall not exercise any control over
or interfere with the persons performing construction activities on
the Leased Premises or the Project, and Tenant, its agents,
officers, employees, contractors, licensees, and invites shall not
have any claim against Landlord for any personal injury or death,
property damage or other loss arising during or from construction
activities or conditions.
G. Representations. Landlord makes no representations or warranties as
to the sufficiency of the Leased Premises for the Permitted Purpose,
or to meet the requirements of Tenant's Square Footage is a
stipulated amount based on Landlord's method of determining Total
Square Footage for rental purposes, and may not reflect the actual
amount of floor space available for Tenant's use.
18. OCCUPANCY: LEASE COMMENCEMENT DATE
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A. Occupancy Date. The Leased Premises shall be ready for occupancy on
such date that the improvements to the Leased Premises are
substantially completed in accordance with Paragraph 17 above,
subject only to items which will not materially affect the use of
the Leased Premises for the Permitted Purpose. Except for delays
caused by Tenant, if the Leased Premises are not ready for occupancy
by the scheduled Lease Commencement Date, then the Lease
Commencement Date shall be extended to the date 5 days after the
Landlord notify Tenant that the Leased Premises are ready for
occupancy. If Landlord fails to cause the Leased Premises or any
portion thereof to be ready for occupancy at the time of the
scheduled Lease Commencement Date,
(i) neither Landlord nor Landlord's agents, officers, employees,
or contractors shall be liable for any damage, loss, liability
or expense caused thereby,
(ii) nor shall this Lease become void or voidable (unless such
failure continues for more than 60 days, in which case Tenant
may, upon 20 days' written notice to Landlord, terminate this
Lease).
B. Tenant Acceptance. Prior to occupying the Leased Premises, Tenant
shall execute and deliver to Landlord a letter, in form and
substance satisfactory to Landlord in its sole discretion,
acknowledging the Lease Commencement Date and certifying that the
improvements to the Leased Premises have been completed and that
Tenant has examined and accepted Leased Premises. Tenant hereby
authorizes any agent or employee who receives the keys to the Leased
Premises on behalf of Tenant to execute and deliver such letter in
Tenant's name. If Tenant fails to deliver such letter, Tenant shall
conclusively be deemed to have made such acknowledgment and
certification by occupying the Leased Premises.
19. RULES AND REGULATIONS. Tenant covenants that Tenant, its agents, officers,
employees, contractors, licensees and invites will at all times observe,
perform and abide by all the general rules and regulations promulgated by
Landlord from time to time and communicated in writing to Tenant. Schedule
3 attached hereto and made a part hereof sets forth Landlord's rules and
regulations in effect on the date hereof.
20. PARKING. Tenant shall have the nonexclusive privilege to use up to the
Authorized Number of Parking Spaces in common with other tenants of
Landlord, but only in general areas reasonably designated by Landlord and
pursuant to the rules and regulations relating to parking adopted by
Landlord from time to time. Tenant agrees not to overburden the parking
facilities and agrees to cooperate with Landlord and other tenants in the
use of parking facilities. Landlord reserves the right in its sole
discretion to determine whether parking facilities are becoming crowded,
and in such event, to allocate specific parking spaces among Tenant and
other tenants or to take such other steps necessary to correct such
condition, including but not limited to policing and towing, and if
Tenant, its agents, officers, employees, contractors, licensees or invites
are deemed by Landlord to be contributing to such condition, to charge to
Tenant as Rent that portion of the cost thereof which Landlord reasonably
determines to be caused thereby. Landlord may, in its sole discretion,
change the location and the nature of the parking spaces available to
Tenant, provided that after such change, there shall be available to
Tenant the same number of spaces available before the change.
21. ACCESS. Tenant shall permit Landlord to enter the Leased Premises at
reasonable time for the purpose of inspecting, altering and repairing the
Leased Premises or the Building and of ascertaining compliance by Tenant
with the provisions of this Lease. Landlord also may show the Leased
Premises to prospective purchasers or renters at reasonable times and upon
reasonable notice, provided that Landlord shall not unreasonably interfere
with Tenant's business operations.
22. SIGNS. No signs or symbols shall be placed in doors or windows or
elsewhere in or about the Leased Premises, or upon any part of the
building, including building directories, without the written approval of
the
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Landlord. Upon expiration or termination of this Lease, all signs
installed by Tenant shall be removed and any damage resulting therefrom
shall be promptly repaired, or such removal and repair may be done by
Landlord and the cost thereof charged to Tenant as rent hereunder. Uniform
signage shall be provided by the Landlord at no charge to the Tenant and
shall be placed on the lobby directory and at the main entrance to each
individual Tenant space.
23. TENANT'S DEFAULT.
A. Event of Default. It shall be an "Event of Default" if (i) Tenant
shall fail to pay any monthly installment of Base Rent or of
Tenant's Pro Rata Share of any Excess Operating Costs, or any other
Rent within ten (10) days of when due, although no legal or formal
demand has been made thereof; (ii) Tenant shall violate or fail to
perform any other conditions, covenants or agreements herein made by
Tenant, and such violation or failure shall continue for a period of
15 days after written notice thereof to Tenant by Landlord; (iii)
Tenant shall make a general assignment for the benefit of its
creditors or shall file a petition for bankruptcy or other
reorganization, liquidation, dissolution or similar relief; (iv) a
proceeding is filed against Tenant seeking any relief mentioned in
(iii) above; (v) a trustee, receiver or liquidator shall be
appointed for Tenant or a substantial part of its property; (vi)
Tenant shall vacate or abandon the Leased Premises (an absence of
substantial activity by Tenant in the Leased Premises for more than
7 days to constitute such abandonment); or (vii) Tenant shall
mortgage, assign or otherwise encumber its leasehold interest.
B. Landlord's Remedies. If an Event of Default occurs, this Lease
shall, at the option of Landlord, cease and terminate and notice
thereof shall operate as a notice to quit--any further notice to
quit, or of Landlord's intention to reenter, being hereby expressly
waived--and Landlord may proceed to recover possession by such
proceedings or methods, including but not limited to reentry and
possession, as may be available under applicable law. If Landlord
elects to terminate the Lease, the obligations herein contained on
the part of Landlord to be performed shall cease without prejudice,
and the right of Landlord to recover from Tenant all Rent accrued up
to the time of termination or recovery of possession by Landlord,
whichever is later, shall continue. Whether or not this Lease is so
terminated, Landlord may remove Tenant from and may relet the Leased
Premises (or any portion(s) thereof) for such rent and upon such
terms as Landlord is able to obtain (which may be for lower or
higher rent, and for a shorter or longer term), and Tenant shall be
liable for all damages sustained by Landlord, including but not
limited to any deficiency in Rent for the duration of the Lease Term
(or for the period of time which would have remained in the Lease
term in the absence of any termination), leasing fees, reasonable
attorney's fees, other marketing and collection costs and all
expenses of placing the Leased Premises in first class rentable
condition.
C. Damages. Any damage or loss sustained by Landlord may be recovered
by Landlord, at Landlord's option, (a) at the time of the reletting;
(b) in separate actions, from time to time, as said damage shall
have been made more easily ascertainable by successive reletting (or
by defaults under successive reletting); (c) at the expiration date
of the Lease Term (or which would have been the expiration date in
the absence of any termination, in which event the cause of action
shall not be deemed to have accrued until said expiration date; or
(d) if Landlord is unable to relet the Leased Premises within 60
days after termination immediately pay, as liquidated damages and
not as a penalty, all Rent then due and the present value
(discounted at 10%) of all Rent which would have become due (based
on Base Rent and Tenant's Pro Rata Share of any Excess Operating
Costs payable at the time of such election) for the period of time
which would have remained in the Lease Term in the absence of any
termination reduced by any amounts recovered by Landlord from
leasing or subleasing the Leased Premises. The provisions contained
in this Paragraph 23 shall be in addition to, and shall not prevent
the enforcement of, any claim Landlord, may have against Tenant for
anticipatory breach of the unexpired term of this Lease. All rights
and remedies of Landlord under Landlord under this Lease shall be
cumulative and shall not be exclusive of any rights and remedies
provided to Landlord under
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applicable law.
24. QUIET ENJOYMENT. If and so long as Tenant pays all Rent and keeps and
performs each and every term, covenant and condition herein contained on
the part of Tenant to be kept and performed, Tenant shall quietly enjoy
the Leased premises without hindrance by Landlord subject to the terms,
covenants and conditions of this Lease and of any Superior Instruments (as
defined in Paragraph 35 below).
25. INABILITY TO PERFORM.
A. The obligation of the Tenant to pay rent and perform all of the
terms, covenants and conditions on the part of the Tenant to be
performed hereunder shall in no way be affected, impaired or excused
because Landlord, due to Unavoidable Delay (as defined in Paragraph
25.B below), is unable to (i) fulfill any of its obligations under
this Lease, or (ii) provide or is delayed in providing any service,
equipment or fixtures expressly or implied to be provided, or (iii)
make or is delayed in making any repairs, replacements, additions,
alterations or decorations. Landlord shall in each instance exercise
reasonable diligence to effect performance when and as soon as
possible. However, Landlord shall be under no obligation to pay
overtime labor rates.
B. "Unavoidable Delay" shall mean any and all delay beyond Landlord's
reasonable control, including without limitation, delays caused by:
Tenant; governmental restrictions, regulations, controls,
preemptions or delays; orders of civil, military or naval
authorities; strikes, labor disputes, lockouts, shortages of labor
or materials, or inability to obtain materials or reasonable
substitutes therefor; defaults of any building or construction
contractors or subcontractors; Acts of God; fire, earthquake,
floods, explosions or other casualty; extreme weather conditions or
other actions of the elements; enemy, civil commotion, riot or
insurrection.
26. HOLD OVER TENANCY. If Tenant shall hold over after the expiration of the
Lease Term, at Landlord's option, Tenant may be deemed to be occupying the
Leased Premises as a Tenant from month to month, which tenancy may be
terminated by one month's notice. During such tenancy, Tenant agrees to
pay to Landlord, monthly, in advance, Rent in an amount equal to 150% of
the monthly installment of Base Rent and of Tenant's Pro Rate Share of any
Excess Operating Costs which was payable on the last day of the Lease
Term, unless a different rate is agreed upon, and to be bound by all of
the terms, covenants and conditions herein specified. If Landlord relets
the Leased Premises (or any portion(s) thereof) to a new lessee and the
terms of such new lease commences during the period for which tenant holds
over, Landlord shall be entitled to recover from Tenant any and all costs,
legal expenses, attorneys' fees, damages, loss of profits or any other
expenses incurred by Landlord as a result of Tenant's failure or inability
to deliver possession of the Leased Premises to Landlord when required
under this Lease.
27. AMENDMENT: WAIVER. This Lease constitutes the entire agreement between the
parties. This Lease shall not be amended or modified except in writing
signed by both parties. Failure to exercise any right in one or more
instances shall not be construed as a waiver of the right to strict
performance as an amendment to this Lease.
28. NOTICES. All notices and approvals to be given by one party to the other
party under this Lease shall be given in writing, mailed or delivered as
follows:
A. To Landlord at: Dynacs Properties, Inc.
c/o Lentz & Fair P.A.
Suite 302
35111 U.S. Hwy 19 North
Palm Harbor, FL 34684
11
<PAGE> 13
or to such other person or persons or at such other address or
addresses designated by notice to Tenant.
B. To Tenant at: Dynacs Engineering Company, Inc.
Suite 300
35111 U.S. Hwy. 19 North
Palm Harbor, Fl. 34684
Notices shall be delivered by hand or by United States certified
mail, postage prepaid, return receipt requested. Notices shall be
considered to have been given upon personal delivery to the
addressee or upon posting in the United States mails as required
herein. Either party may change its address for notice purposes by
giving notice thereof to the other party; provided, however, that no
such change of address notice shall be deemed to be effective until
actually received by the addressee.
29. SCHEDULES: EXHIBITS. All schedules, exhibits and typewritten riders, if
any, attaches or added hereto are incorporated into and made part of this
Lease by reference and the terms thereof shall control over inconsistent
provisions in the paragraphs of this Lease.
30. LIMITATION OF LANDLORD'S LIABILITY. The obligations of the Landlord under
this Lease do not constitute personal obligations of Landlord or the
individual trustee, partners, shareholders, directors, officers, employees
or agents of Landlord, and Tenant shall look solely to Landlord's interest
in the Leased Premises, and to no other assets of Landlord, for
satisfaction of any liability in respect of this Lease, and will not seek
recourse against the individual trustees, partners, shareholders,
directors, officers, employees or agents of Landlord or any of their
personal assets for such satisfaction.
31. LANDLORD'S RESERVED RIGHTS. Without notice and without liability to
Tenant, Landlord shall have the right to (i) grant utility easements or
other easements in, or replat, subdivide or make other changes in the
legal status of, the land underlying the Building or the Project as
Landlord shall deem appropriate in its sole discretion, provided such
grant or changes do not substantially interfere with Tenant's use of the
Leased Premises for the Permitted Purpose; (ii) sell the Building or the
Project (or any portion(s) thereof) and assign this Lease and deliver the
Deposit to the Purchaser, and upon such assignment and delivery Landlord
shall be released from all of its obligations under this Lease and Tenant
agrees to attorn to such Purchaser, or any other successor or assign of
Landlord through foreclosure or deed in lieu of foreclosure or otherwise,
and to recognize such person as successor Landlord under this Lease; (iii)
add to or take away from the Project any building(s) or portion(s) thereof
(in which event, Total Square Footage and Tenant's Pro Rata Share shall be
adjusted accordingly); (iv) change the name or street address of the
Building or the Project; (v) install and maintain signs on and in the
Building and the Project; and (vi) make such rules and regulations, in the
sole judgment of the Landlord, may be needed from time to time for the
safety of the tenants, the care and cleanliness of the Building and the
Project and the preservation of good order therein.
32. ESTOPPEL CERTIFICATE. Within 10 days after request therefor by Landlord,
tenant shall execute (in recordable form) and deliver a certificate to any
proposed lender or purchaser, or to Landlord, together with a true and
correct copy of this Lease, certifying (with such exceptions or
modifications as may be the case) (i) that this Lease is in full force and
effect without modification, (ii) the amount, if any, of Security Deposit
paid by tenant to Landlord, (iii) that Landlord has performed all of its
obligations due to be performed under this Lease and that there are no
defenses, counterclaims, deductions or offsets outstanding or other
excuses for Tenant's performance under this Lease, and (iv) any other fact
reasonably requested by Landlord or such proposed lender or purchaser.
Landlord may present to tenant a form of such certificate, and Tenant's
failure to properly execute and deliver such form of certificate (with
such exceptions or modifications noted therein as may be asserted by
tenant in good faith) within ten days after request therefor shall be
conclusive upon tenant as to the truth of all statements contained therein
as presented by Landlord.
12
<PAGE> 14
33. ACCORD AND SATISFACTION. No receipt and retention by Landlord of any
payment tendered by Tenant in connection with this Lease shall give rise
to or support or constitute an accord and satisfaction, or a compromise or
other settlement, notwithstanding any accompanying statement, instruction
or other assertion to the contrary (whether by notation on a check or in a
transmittal letter or other), unless Landlord, in a separate writing duly
executed by Landlord, agrees. Landlord may receive and retain, absolutely
and for itself, any and all payments so tendered, notwithstanding any
accompanying instructions by tenant to the contrary. Landlord will be
entitled to treat any such payments as being received on account of any
item or items of Rent, interest, expense or damage due in connection
herewith, in such amounts and in such order as Landlord may determine at
its sole option.
34. SEVERABILITY. The parties intend this Lease to be legally valid and
enforceable in accordance with all of its terms to the fullest extent
permitted by law. If any term hereof shall be invalid or unenforceable,
the parties agree that such term shall be stricken from this Lease, the
same as if it never had been contained herein. Such invalid or
unenforceability shall not extend to any other term of this Lease, and the
remaining terms hereof shall continue in effect to the fullest extent
permitted by law, the same as if such stricken term never had been
contained herein. The above notwithstanding, if any term of this Lease
shall be invalid or unenforceable, and if striking such term from this
Lease would substantially and adversely affect the amount of Rent to be
received by Landlord or the nature of its obligations to Tenant, or
otherwise affect the economic bargain agreed to by Landlord in this Lease,
Landlord shall have the option to terminate this Lease upon not less than
30 days' notice to Tenant.
35. SUBORDINATION. The rights of Tenant hereunder are and shall be, at the
election of any lender, subject and subordinate to the lien of any
mortgage or mortgages, or the lien resulting from any other method of
financing or refinancing, now or hereafter in force against the Building
or the Project (or any portion(s) thereof), and to all advances made or
hereafter to be made upon the security thereof ("Superior Instruments").
If requested, Tenant agrees to execute whatever documentation may be
required to further effect the provisions of this Paragraph.
36. DEFAULT INTEREST. All amounts owing to Landlord under this Lease for which
the date of payment is not expressly fixed, shall be paid within ten (10)
days after the date Landlord renders appropriate statements of account.
Tenant shall pay Landlord interest on any delinquent Rent or other sums
owing under this Lease at a rate equal to the lesser of (i) eighteen
percent (18%) per annum or (ii) the highest annual rate of interest then
allowed by law, from the date due (regardless of whether there exist any
cure periods provided in this Lease) until paid.
37. TIME. Time is of the essence hereof.
38. APPLICABLE LAW. This Lease shall be construed according to the laws of the
State of Florida within which the Leased Premises is located.
39. BROKER INDEMNIFICATION. As part of the consideration for the granting of
this Lease, Tenant represents and warrants to the Landlord that no Broker
or Agent negotiated or was instrumental in negotiating or consummating
this Lease except the Managing Agent and the Broker of Record, and Tenant
agrees to indemnify Landlord against any loss, expense (including legal
expenses), cost or liability incurred by Landlord as a result of a claim
by any other broker or finder.
40. BINDING EFFECT: GENDER. This Lease shall be binding upon and inure to the
benefit of the parties and their successors and assigns. It is understood
and agreed that the terms "Landlord" and "Tenant" and verbs and pronouns
in the singular number are uniformly used throughout this Lease regardless
of gender, number or fact of incorporation of the parties hereto.
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<PAGE> 15
41. RADON GAS. Radon is a naturally occurring radioactive gas that, when it
has accumulated in a building in sufficient quantities, may present health
risks to persons who are exposed to it over time. Levels of radon that
exceed federal and state guidelines have been found in buildings in
Florida. Additional information regarding radon and radon testing may be
obtained from your County Public Health Unit.
This Lease is executed as of the date first written above.
WITNESSES: LANDLORD
DYNACS PROPERTIES, INC.
/s/ Veronica M. Fleming BY: /s/ [ILLEGIBLE]
----------------------- ----------------------------------------
/s/ [ILLEGIBLE] ITS: /s/ [ILLEGIBLE]
----------------------- ----------------------------------------
WITNESSES: TENANT:
DYNACS ENGINEERING
/s/ Kathy Simdez BY: /s/ Judy D. Hess
----------------------- ----------------------------------------
/s/ Pat McGovern ITS: Agent
----------------------- ----------------------------------------
Where Tenant is a corporation, this Lease shall be signed by a President
or Vice President and Secretary or Assistant Secretary of Tenant. Any other
signatories shall require a certified corporate resolution attesting to the
fact. In addition, personal guarantees will be required.
This Lease shall be effective only when it is signed by both the Landlord
and the Tenant. The Tenant submission of a signed Lease for review by Landlord
does not give the Tenant any interest, right or option in the Leased Premises.
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<PAGE> 16
3rd. FLOOR
[GRAHPIC OMITTED]
<PAGE> 17
2nd. FLOOR
[GRAPHIC OMITTED]
<PAGE> 18
1st. FLOOR
[GRAPHIC OMITTED]
<PAGE> 1
Exhibit 10.20
FACTORY LEASE AGREEMENT
TYPE C FACTORY
THIS AGREEMENT is made the 3rd day of November 1998 BETWEEN:
I. PT BATAMINDO INVESTMENT CORPORATION, a company duly incorporated under the
laws of Indonesia and having an office at Wisma Batamindo, Jalan Rasamala
No. 1, Batamindo Industrial Park, Mukakuning, Batam 29433, Indonesia
(hereinafter called "BIC");
AND
II. DYNACS DIGITAL STUDIOS PTE LTD, a company duly incorporated under the laws
of Singapore and having its principal place of business at No. 2, Leng Kee
Road, #04-01, Thye Hong Centre, Singapore 159086 (hereinafter called the
"Lessee").
WHEREAS
A. BIC is the developer of an industrial estate located at Mukakuning, Batam,
Indonesia, namely Batamindo Industrial Park (hereinafter called "BIP");
B. The Lessee desires to lease and to operate a factory in BIP.
NOW THEREFORE the parties hereto agree as follows:-
ARTICLE 1
LEASE PREMISES
BIC agrees to lease to the Lessee and the Lessee agrees to take a lease from BIC
of factory premises at Lot 308 of BIP with a total lettable area of
approximately 972 square metres subject to final survey, if any, as marked red
in the plan attached hereto as Schedule 1 (hereinafter called the "Lease
Premises").
ARTICLE 2
UTILISATION OF THE LEASE PREMISES
2.1 The Lessee shall utilise the Lease Premises to operate a factory in
conformity with its business permit obtained from the Coordinating Board
of Capital Investment (BKPM) and for no other purposes whatsoever.
(Initials)
1
<PAGE> 2
2.2 Any material alteration of the Lessee's utilisation of the Lease Premises
shall require prior written approval from BIC. The Lessee shall also
obtain approvals from the relevant authorities if necessary.
ARTICLE 3
LEASE TERM & DELIVERY OF LEASE PREMISES
3.1 The lease term (hereinafter called the "Lease Term") shall be for a fixed
term of three (3) years commencing from 3 November 1998 (hereinafter
called the "Lease Commencement Date").
3.2 Upon the expiry of the Lease Term, this Lease Agreement shall be
automatically renewed for a further term of three (3) years and shall
continue to be automatically renewed for the sane term of years at the
expiry of each renewed term unless either party notifies the other in
writing not less than six (6) months prior to the expiration of the Lease
Term or each renewed term, as the case may be, that this Lease Agreement
shall not be renewed. Notwithstanding the foregoing, this Lease Agreement
shall automatically terminate when BIC's tenure or right to the land of
the Lease Premises is terminated or expires. In such an event, BIC shall
not be liable for any loss or damage which may result.
3.3 Notwithstanding the preceding clause, the rental the Lessee is liable to
pay to BIC during each renewed term shall be BIC's listed standard rentals
prevailing at the date of each renewal.
3.4 Physical Possession of the Lease Premises shall be given to the Lessee on
the Lease Commencement Date. Notwithstanding the foregoing, physical
possession need not be given where the deposit referred to in Article 6
has not been paid to BIC in full but in such an event the Lease Term shall
still commence on the Lease Commencement Date and all payments due under
this Lease Agreement shall be due accordingly.
ARTICLE 4
RENTAL
4.1 The rental for the Lease Premises is Singapore Dollars Nine Thousand Seven
Hundred and Twenty (S$9,720) per month (hereinafter called the "Rental")
calculated as follows:-
2 2
S$10 per m per month x 972 m lettable area
4.2 The Rental shall commence on the Lease Commencement Date and shall be paid
by the Lessee to BIC within fourteen (14) days of BIC's invoice date. Each
invoice sum shall be for an amount not exceeding three (3) month's Rental.
Where there is a failure to pay on the due date, Article 7 shall apply.
(Initials)
2
<PAGE> 3
4.3 Notwithstanding the preceding clause, no Rental shall be due for the 1st,
2nd 23rd 24th, 35th and 36th month of the Lease Term. This clause shall
not apply upon any renewal of this Lease Agreement in accordance with
Article 3.2.
ARTICLE 5
SERVICE CHARGE
5.1 In addition to the Rental, the Lessee shall pay BIC a service charge of
Singapore Dollar One and Cents Ten only (S$1.10) per square metre of the
area of 1206 square metres per year (hereinafter called the "Service
Charge") for the maintenance of the common areas more specifically set out
in Schedule 2.
5.2 The Service Charge shall be reviewed and revised by BIC from time to time.
5.3 The Service Charge shall commence on the Lease Commencement Date and shall
be paid by the Lessee to BIC within fourteen (14) days of BIC's invoice
date. Each invoice sum shall be for an amount not exceeding three (3)
month's Service Charge. Where there is a failure to pay on the due date,
Article 7 shall apply.
ARTICLE 6
DEPOSIT
6.1 The Lessee shall pay BIC a cash deposit equivalent to three (3) month's
Rental (hereinafter called the "Deposit") on or before the Lease
Commencement Date as security against breach of any of the terms and
conditions in this Lease Agreement.
6.2 Where the Lessee fails to pay the Rental or the Service Charge or any
other payments required to be paid under this Lease Agreement or breaches
any other terms and conditions in this Lease Agreement, BIC is entitled to
use the Deposit or any part thereof for the settlement of such unpaid
payments or to compensate for damages or expenses resulting from such
breach without prior notification to the Lessee and without prejudice to
other remedies available to BIC.
6.3 Where the Deposit or any part thereof is utilised by BIC in accordance
with Article 6.2,the Lessee shall immediately pay to BIC in cash a
sufficient amount to compensate for the Deposit or part thereof which have
been utilised by BIC as aforesaid. Such compensation shall be paid within
seven (7) days of BIC's written demand failing which Article 7 shall
apply.
6.4 Where the Rental has been increased in accordance with this Lease
Agreement, the Lessee shall pay the amount of such increase within thirty
(30) days of BIC's written demand so that the Deposit shall at all times
be equal to three (3) month's Rental. Where there is a failure to pay on
the due date, Article 7 shall apply.
6.5 The Lessee is not entitled to request that the Deposit be used to pay for
or discharge any of its obligations under this Lease Agreement.
(Initials)
3
<PAGE> 4
6.6 The Lessee is not entitled to transfer, assign or create any security over
its interest in the Deposit or any part thereof to any third party.
6.7 Subject to other provisions in this Lease Agreement, the Deposit shall be
repaid to the Lessee without interest within thirty (30) days of the
termination or expiration of this Lease Agreement PROVIDED THAT the Lessee
has surrendered the Lease Premises in the condition it is obliged to
surrender the said premises and there being no existing breach of the
terms and conditions of this Lease Agreement.
ARTICLE 7
LATE OR NON-PAYMENT
7.1 Where the Lessee fails to pay on the due date the Rental, Service Charge,
any shortfall in the Deposit the Lessee is obliged to make good or any
other payments required under this Lease Agreement, or any part of the
foregoing, the Lessee is obliged to pay interest on the overdue sum at ten
(10) per cent per annum from the due date until payment is received by
BIC.
7.2 Without prejudice to the preceding clause, where such payments or part
thereof remain outstanding, BIC is entitled to terminate this Lease
Agreement under Article 8.2.1.
7.3 Without prejudice to the foregoing clauses, Where such payments or part
thereof remain outstanding for more than thirty (30) days BIC may
terminate all supply of electricity and water to and the use of telephone
and facsimile facilities by the Lease Premises without being liable for
any losses or damages resulting therefrom.
ARTICLE 8
TERMINATION
8.1 The Lessee is entitled to terminate this Lease Agreement prior to the
expiry of the Lease Term by giving not less than six (6) months written
notice of its intention to BIC. For such termination, the Lessee is not
entitled to the refund of the Deposit or any Rental or Service Charge or
other payments paid in advance or already made to BIC.
8.2 BIC is entitled to terminate this Lease Agreement immediately by written
notice in the following cases:-
8.2.1 Where the Rental, Service Charge, Deposit or any shortfall
thereof, or any other payments required under this Lease
Agreement, or any part of the foregoing remains unpaid by the
Lessee for thirty (30) days after its due date;
8.2.2 Where the Lessee breaches any other terms and conditions of this
Lease Agreement and the Lessee fails to rectify such breach within
thirty (30) days after BIC's written notice to the Lessee to so
rectify';
(Initials)
4
<PAGE> 5
8.2.3 Where the Lessee breaches Article 12 (w);
8.2.4 Where the Lessee is in breach of any prevailing laws or
regulations including but not limited to the regulations of the
Batam Industrial Development Authority;
8.2.5 Where the Lessee's activities are suspended or prohibited by the
authorities or its licences or permits are suspended or revoked;
or
8.2.6 Where any insolvency or bankruptcy proceedings whether within or
outside any court are commenced by or against the Lessee.
8.3 Where BIC terminates under Article 8.2, the Lessee is not entitled to the
refund of the Deposit or any Rental or Service Charge or other payments
paid in advance or already made to BIC.
8.4 For termination under this Article or any other Article in this Lease
Agreement:-
8.4.1 there is no necessity to comply with the provisions of Article
1266 Indonesian Civil Code requiring reference to a judicial body
for such termination, which provisions the parties waive;
8.4.2 such termination is without prejudice to the accrued rights of
either party or to their rights in respect of any antecedent
breach;
8.4.3 such termination is without prejudice to other remedies available
to the parties under this Lease Agreement or otherwise.
ARTICLE 9
SURRENDER OF LEASE PREMISES
9.1 At the expiration of the Lease Term or any renewed term or the termination
of this Lease Agreement, the Lessee shall immediately surrender the Lease
Premises to BIC in the condition BIC delivered possession of the Lease
Premises to the Lessee, normal wear and tear excepted.
9.2 Where the Lessee fails to surrender the Lease Premises on the expiration
of the Lease Term or the termination of this Lease Agreement, the Lessee
shall pay BIC double the Rental for the period the Lessee continues to
occupy the Lease Premises after such expiration or termination. Nothing in
this clause shall prejudice BIC's rights at law including, without
limitation, rights to evict the Lessee.
(Initials)
5
<PAGE> 6
ARTICLE 10
MAINTENANCE AND REPAIR OF LEASE PREMISES
10.1 The Lessee shall maintain the Lease Premises and repair all the damage
sustained by the Lease Premises except for fair wear and tear, keep the
Lease Premises including lavatories tidy and clean and keep its own
environmental security at its own cost and responsibility.
10.2 BIC is entitled to access and to inspect the Lease Premises at all
reasonable times to ascertain whether the Lessee has utilized and
maintained the Lease Premises in accordance with this Lease Agreement.
ARTICLE 11
INSURANCE
11.1 BIC shall insure the buildings of the Lease Premises including its annexes
against loss risk or damage caused by fire or other cause on BIC's account
during the Lease Term or any renewed term under this Lease Agreement.
11.2 The Lessee is obliged to insure its property located in the Lease Premises
against loss risk or damage caused by fire or other cause and insure its
employees and/or staff against accident for whatsoever reason. The Lessee
hereby holds BIC harmless from any consequences arising out of such
events.
ARTICLE 12
LESSEE'S OTHER COVENANTS
The Lessee hereby agrees as follows:-
(a) to use the Lease Premises in compliance with the utilization of BIP as
decided by the authorities;
(b) to obtain all necessary licenses to operate in BIP;
(c) to pay all taxes and other charges (except building and property taxes)
related to its operation and the possession of the Lease Premises;
(d) not to use any flammable building materials for internal partitioning or
to store any dangerous, flammable or obnoxious substances within or
without the Lease Premises;
(e) not to modify any existing electrical wirings or modify or replace any
existing fire alarm fixtures and fittings or affix or install any further
or additional electrical and fire alarm wiring extensions in or about the
Lease Premises without the written consent of BIC which consent shall not
be unreasonably withheld Provided Further That all such work shall be
carried out by a licensed electrical contractor or competent person as
approved by BIC to be employed and paid by Lessee who shall
(Initials)
6
<PAGE> 7
ensure as part of the work that the existing circuits and equipment are
not overloaded or imbalanced. Prior to any electrical and fire alarm
installation or modification work, Lessee will be required to submit the
necessary plans;
(f) to permit BIC or its agents with or without workmen or others at all
reasonable times and by prior appointment to enter the Lease Premises to
take inventories of BIC's fixtures and fittings therein or to view the
condition thereof and examine the state of repair of the Lease Premises
and thereupon BIC may give the Lessee notice in writing specifying any
work or repairs necessary to be done which are the responsibility of the
Lessee under the terms of this Lease Agreement and shall require the
Lessee forthwith to execute the same and the Lessee shall pay BIC's
reasonable costs of survey attending the preparation of the notice and if
the Lessee shall not within fourteen (14) days after the service of such
notice proceed diligently and in workmanlike manner with the execution of
such work or repairs then to permit BIC (who shall not be under any
obligation so to do) to enter upon the Lease Premises and execute such
work or repairs and the cost thereof shall be a debt due from the Lessee
to BIC and be forthwith recoverable Provided Always that BIC shall not be
liable to the Lessee for any loss damage or inconvenience caused by such
work or repairs, unless caused by any neglect, default or omission of BIC,
its servants or agents;
(g) to make good and sufficient provision for the safe and efficient disposal
of all waste and pollutants generated at the Lease Premises to the
requirements and satisfaction of BIC and/or relevant government
authorities (including but not limited to compliance with the Class 2
Standard for Effluent Discharge as required under BIDA's directive
027/KPTS-REN/11/1993) PROVIDED THAT in the event of any default by the
Lessee under this covenant BIC may carry out such remedial measures as it
thinks necessary and all costs and expenses incurred thereby shall
forthwith be recoverable from the Lessee as a debt;
(h) not to do or suffer to be done on or in the Lease Premises anything
whereby the insurances of the same or of the BIP or any part thereof may
be rendered void or voidable or whereby the premium thereon may be
increased and to repay to BIC on demand all sums paid by BIC by way of
increased premium and all expenses incurred by BIC in connection with
insurance rendered necessary by a breach or non-observance of this
covenant without prejudice to any other rights and remedies available to
BIC;
(i) not to do or permit or suffer to be done anything in or upon the Lease
Premises or any part of the BIP which in the opinion of BIC is a nuisance
or cause annoyance to or in any way interfere with the business or the
quiet or comfort of the other occupants of the BIP Provided That BIC shall
not be responsible to the Lessee for any loss, damage or inconvenience as
a result of nuisance, annoyance or any interference whatsoever caused by
the other occupants of the BIP;
(j) not to use the Lease Premises for any illegal or immoral purpose;
(Initials)
7
<PAGE> 8
(k) not to install any machinery or fixtures in the Lease Premises without
having sought the advice of its professional advisors and to submit a
layout plan of the Lessee's machinery for the approval of BIC and/or
relevant authorities prior to the actual fixing of the machinery Provided
That the Lessee shall be fully responsible for any installation of
machinery or fixtures and shall indemnify BIC from any losses arising
therefrom;
(I) not to assign sublet or part with or share the possession of the Lease
Premises or any part thereof; without the consent of BIC, which consent
shall not be unreasonably withheld;
(in) at the termination of the Lease Term to yield up the Lease Premises and
all BIC's fixtures fittings fastenings and other things thereto anywhere
belonging or appertaining in such good and substantial repair, fair wear
and tear excepted as shall be in accordance with the covenants of the
Lessee hereinbefore contained and with all locks and keys complete;
(n) not to install and/or use any electrical installations, machines or
apparatus that may cause or causes heavy power surge, high frequency
voltage and current, air borne noise, vibration or any electrical or
mechanical interference or disturbance whatsoever which may prevent or
prevents in any way the service or use of any communication system or
affects the operation of other equipment, installations, machinery,
apparatus or plants of other lessees and in connection therewith, to allow
BIC or any authorised persons to inspect at all reasonable times, such
installation, machine or apparatus in the Lease Premises to determine the
source of the interference or disturbance and thereupon, to take suitable
measures, at the Lessee's own expense, to eliminate or reduce such
interference or disturbance to BIC's satisfaction, if it is found by BIC
or such authorised person that the Lessee's electrical installation,
machine or apparatus is causing or contributing to the said interference
or disturbance;
(o) to indemnify BIC against any claims, proceedings, action, losses,
penalties, damages, expenses, costs, demands which may arise in connection
with Article (n) above;
(p) not to hold BIC responsible for any costs, loss of profits, or any
consequential losses;
(q) to comply with any prevailing laws and regulations in Indonesia;
(r) to comply with the BIP Estate Regulations including any amendments
thereto;
(s) not to modify or alter the Lease Premises without submitting to BIC the
revised layout and building plans of the Lease Premises for prior written
approval by BIC. Any alteration or addition to the Lease Premises after
approval by BIC should be done by contractors, approved by BIC and all the
expenses are for the account of the Lessee. The Lessee shall hold BIC
harmless from any claims, liabilities or losses arising therefrom. Any
improvement, addition, partition, or other improvements to the Lease
Premises shall be removed at the expiration of Lease Term or termination
of this Lease Agreement unless otherwise requested by BIC and agreed to by
the Lessee;
(Initials)
8
<PAGE> 9
(t) to pay all expenses and deposits for and in respect of the consumption of
electricity, water and the use of telephone and facsimile facilities,
including without limitation to the foregoing any connection expense
recovery, to BIC where BIC is the body supplying the same;
(u) where no time is stated in this Lease Agreement for any payments, the
Lease shall pay BIC such payments within the time stipulated in BIC's
invoice for the same, such time not to be less than fourteen (14) days
from the date of BIC's invoice;
(v) not to hold BIC liable for any losses or damages (including without
limitation to the foregoing any loss of profit or any consequential
losses) arising from any interruption, cessation, shortfall or variation
in electrical power, water supply and telephone and facsimile facilities.
(w) not to permit or suffer any change in the ownership or the shareholding
(whether legal or beneficial) of the Lessee or the transfer of any part of
its issued captial without the prior written consent of BIC.
All consequences arising from the non compliance of the abovementioned shall be
fully borne by the Lessee and the Lessee hereby indemnfies and holds
BIC harmless.
Without prejudice to BIC's other rights, in the event that the Lessee shall fail
to remedy any breach of the above obligations for a period of seven (7) days
after BIC's written notification of such breach, BIC, its employees, agents or
contractors shall be entitled (though not obliged) to enter upon the Lease
Premises and to take whatever remedial measures it or they deem fit without the
need to resort to judicial or arbitral proceedings and, in order to effect such
remedial measures, the Lessee hereby grants BIC an irrevocable power of attorney
with the right of substitution to enter upon the Lease Premises and to effect
such remedial measures with or without the assistance of the competent
authorities, at the expense of the Lessee and at no responsibility nor liability
on the part of BIC from the consequences which may arise therefrom.
ARTICLE 13
OTHER AGREEMENTS & ASSIGNMENT
13.1 This Lease Agreement and the rights and obligations herein shall be
assigned in writing to the Indonesian company which the Lessee
incorporates to operate the factory in the Lease Premises forthwith upon
the Indonesian company's Deed of Establishment being approved by the
Ministry of Justice of Indonesia. The form of the written assignment shall
be prescribed by BIC.
(Initials)
9
<PAGE> 10
ARTICLE 14
FORCE MAJEURE
Neither party shall be liable for any delay or default in the performance of its
obligations under this Lease Agreement caused by circumstances beyond the
control and without the fault or negligence of such party, including but not
restricted to acts of God, act of the public enemy, perils of navigation, fire,
hostilities, war (declared or undeclared), blockade, labour disturbances,
strikes, riots, insurrections, civil commotion, earthquakes, accidents or other
cause(s) beyond the party's control. In any of the events mentioned above, the
parties shall, for the duration of such event, be relieved of any such
obligation under this Lease Agreement as is affected by said event.
PROVIDED THAT where the duration is more than thirty (30) days the party
entitled to the benefit of the obligation to be performed is entitled to
immediately terminate this Lease Agreement by notice in writing to the other
party.
AND PROVIDED THAT the provisions of this Lease Agreement shall remain in force
with regard to all other obligations under this Lease Agreement which are not
affected by such event.
AND PROVIDED FURTHER THAT all parties shall resume their full obligations under
this Lease Agreement upon the cessation of such event.
ARTICLE 15
MISCELLANEOUS
15.1 This Lease Agreement shall remain binding on the heirs and/or successors
in title and/or assignees of the parties hereto.
15.2 Unless otherwise provided in this Lease Agreement, this Lease Agreement
sets forth the entire understanding and agreement between the parties with
respect to the subject matter hereof and supersedes and cancels any and
all prior or contemporaneous oral or written agreements or
representations, if any, between the parties.
15.3 This Lease Agreement may only be amended by a document in writing signed
by each of the parties hereto.
15.4 No waiver of any provision of this Lease Agreement nor consent to any
departure thereform by any of the parties hereto shall be effective unless
the same shall be in writing and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which it
was given. No default or delay on the part of any of the parties hereto in
exercising any rights, powers or privileges hereunder shall operate as a
waiver thereof or of any other right hereunder; nor shall a single or
partial exercise or the exercise of any other rights, power or privilege.
15.5 Clause headings are inserted for convenience of reference only and shall
be ignored in the construction or interpretation of this Lease Agreement.
(Initials)
10
<PAGE> 11
15.6 Any notice or request required or permitted to be given or made under this
Lease Agreement shall be in writing and such notice or request shall be
deemed to have been duly given or made when it is delivered by hand, mail,
courier, telex or facsimile to the party to which it is required or
permitted to be given or made at such party's address as specified below
or at such address as such party shall have designated by notice in
writing to the other party giving such notice or making such request.
BIC : Wisma Batamindo, J1. Rasamala No.1
Mukakuning, Batam 29433
Indonesia
Lessee : Lot 308, Jalan Angsana
Batamindo Industrial Park
Mukakuning, Batam, Indonesia
ARTICLE 16
GOVERNING LAW AND DISPUTE SETTLEMENT
16.1 This Lease Agreement shall be governed by and construed in accordance with
the laws of the Republic of Indonesia.
16.2 This Lease Agreement and any right or obligation granted or to be
performed herein is subject:-
(a) to the prevailing laws and regulations including but not limited to
the regulations of the Batam Industrial Development Authority; and
(b) rules and regulations formulated by BIC from time to time in
relation to the operation of BIP of which have been approved by
Batam Industrial Development Authority (hereinafter called the
"Industrial Estate Regulations") and the Lessee shall observe such
regulations.
16.3 In the event that any Article or part of an Article in this Lease
Agreement shall, for any reason, be determined by a court or arbitral
tribunal to be invalid or unenforceable then:-
(a) the remaining Articles or part Article shall not be affected,
impaired or. invalidated, shall remain in full force and, effect and
shall continue to be binding upon the parties; and
(b) so far as possible, the said Article or part Article shall be deemed
to be modified to the last degree possible so as to comply with the
applicable law or regulation and be valid and enforceable.
(Initials)
11
<PAGE> 12
16.4 Any dispute arising from this Lease Agreement shall be settled amicably.
Failing such amicable settlement, the parties shall refer the case to the
District Court of South Jakarta in Jakarta.
16.5 For the purpose of Article 16.4 above, both parties elect the fixed legal
domicile at the Registrar office of the District Court of South Jakarta in
Jakarta (Panitera Pengadilan Negeri Jakarta Selatan di Jakarta).
12
<PAGE> 13
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
by their respective authorised representatives the date and year first above
written.
Signed for and on behalf of )
P.T. BATAMINDO INVESTMENT ) /s/ Goh Song How
CORPORATION ) -------------------------------------
Name : GOH SONG HOW
Designation : Vice President Director
AND
/s/ Kuky Permana
-------------------------------------
Name : KUKY PERMANA
Designation : Director
Signed for and on behalf of )
DYNACS DIGITAL )
STUDIOS PTE LTD ) /s/ Venugopal Ramesh
in the presence of: ) -------------------------------------
Name : VENUGOPAL RAMESH
Designation : Managing Director
/s/ Ng Soi Hong
- -----------------------------
Name: NG SOI HONG
Designation: FINANCE MANAGER
13
<PAGE> 14
SCHEDULE 1
LEASE PREMISES
PAGE ONE OF TWO
[GRAPHIC OMITTED]
(Initials)
<PAGE> 15
SCHEDULE 1
LEASE PREMISES
PAGE TWO OF TWO
[GRAPHIC OMITTED]
(Initials)
<PAGE> 16
SCHEDULE 2
SERVICE CHARGE
Service Charges are levied for the maintenance of common properties and the
infrastructure of the industrial park such as driveway, drain, street lighting
and the turfed areas. However, the Lessee is to maintain and upkeep the Premises
in accordance with this Agreement. Disposal of refuse and industrial waste shall
not be included in the maintenance services to be rendered
(Initials)
<PAGE> 17
--------
ORIGINAL
--------
TO: JAVIER BENAVENTE
VALUE IN S$
11 PAGES ONLY.
FROM: V RAMESH
---------------------------------------------------
FIRE
INSURANCE
POLICY NR. 02-19-20000868/00
---------------------------------------------------
-------------------------------
PT. ASURANSI WAHANA TATA
BATAM BRANCH
-------------------------------
<PAGE> 18
KANTOR PUSAT:GEDUNG ASURANSI WAHANA TATA
JI. H.R. Rasona Said Key, 0 - 4 Jakarta 12920
[ILLEGIBLE]
TLX. 62304 WATANO IA FAX (021)-5203149, INLEGIBLE,
- --------------------------------------------------------------------------------
INDONESIAN STANDARD FIRE POLICY
IN CONSIDERATION of the payment of the premium and on the basis of written
declarations given by the Insured which constitute an inseparable part of this
policy the undersigned insures property and/or interests specified below against
loss caused by perils described herein subject to the conditions and
stipulations printed on, attached to or written in this policy.
THE SCHEDULE
- --------------------------------------------------------------------------------
Policy No. : 02-19-20000(ILLEGIBLE)/00
(new)*
Named of the Insured : Pt. Dynacs Digital Studios
JL Angsana Lot 308 Batamindo Industrial
Park
Address : MUKA Kuning-Batam
- --------------------------------------------------------------------------------
Insurance Period : 12 ( --- Twelve --- ) months,
Commencing : 29th May 1999 until 29th May 2000 12 O'clock noon
local time at the location of the insured object.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Lighting : electric Fire Premium : SGD 578.00
Construction Class : 1st class Additional Premium : SGD 633.40
Type of Risk/Occupancy : Laboratories Photographic Additional Premium :
Code No. : 2924 Additional Premium :
Premium Rate : 0.580000 % 0 (per mil)p.o .................. :
Policy Expenses : SGD 2.86
------------------
: SGD 1,213.11
Additional Coverage : Riot, Strike & Malicious
Damage Sales Tax :
Code No. : 4.1A Stamp Duty : SGD 2.44
------------------
Premium Rates : 0.615000 % 0 (per mile)p.o Total : SGD 1,210.55
==================
(IN WORDS : One thousand two hundred thirteen Dollars and Fifty-five cent.
..............................................................)
</TABLE>
- --------------------------------------------------------------------------------
-- Theft during fire exclusion clause; -
Electrical short circuit clause (compulsory)
Attachment/Additional clauses -- Reinstatement additional premium
clause-compulsory; - Addendum PSKI.
-- Payment of premium warranty; - Electronics
Data Recognition Exclusion.
- --------------------------------------------------------------------------------
No.: Specification of insured items : Sum Insured:
A. On Building Laboratories Photographic (as per
attached list)1st Class construction located
at Jaian Angsana Lot 308. Batamindo Industrial
Park, Muka Kuning Batam 29433.- SGD 179,000.00
B. On Furnitures (as per attached list) SGD 80,000.00
C. On Office Equipments (as per attached list) SGD 7,000.00
D. On Machineries (as per attached list) SGD 754,000.00
Items B, C & D which are inside in the above building,
--------------------
Total = SGD 1,030,000.00
====================
- --------------------------------------------------------------------------------
Attached
- Endorsement Code: 4.1A Date: Batam, 1st May 1999
-----------------------------
Signature of the Insured
PT. ASURANSI WAHANA TATA
/s/ [ILLEGIBLE]
- --------------------------------------------------------------------------------
<PAGE> 19
-2-
PERILS INSURED
This Policy covers loss of or damage to the insured property and/or interests
caused by:
1. FIRE,
Including fire as a consequence of self-combustion, negligence,
wrongdoings or crime committed by own servant, neighbour enemy, robber,
and others whomsoever, or other unknown causes of fire; including:
the consequences of fire to other nearby objects, such as loss of or
damage to insured property and/or interests, caused by water or other
instruments used to fight or extinguish the fire, also loss or damage as a
consequence of destruction ordered by lawful authorities to prevent
further spreading of the fire.
2. LIGHTING,
3. EXPLOSION,
(1) The Policy covers losses due to explosion of all kinds except those
by nuclear energy.
(2) Explosion is any sudden release of energy resulting from the
expansion of gases or vapours. The bursting of a container (boiler,
pipe, etc.) is only regarded as an explosion if the walls of the
container are torn open to such an extent that a sudden equalization
of the pressures inside and outside takes place. If an explosion
occurs inside a container due to chemical reaction, any damage to
the container is indemnifiable even if the walls of the container
are not torn open. Losses caused by low pressure are not covered by
the policy.
(3) Losses to combustion engines resulting from the explosion taking
place within the combustion chambers or to switching members in
electrical switches by the gas pressure arising within them are
excluded from the cover.
4. IMPACT OF FALLING AIRCRAFT
Loss by aircraft shall include direct loss resulting from actual physical
contact of an aircraft with property covered hereunder or with the
building containing the property covered hereunder, and direct loss by
objects falling therefrom.
PERILS NOT INSURED
This Insurance does not cover loss of or damage to the insured property and/or
interests caused by:
1. Fire or Explosion resulting from its own inherent vice, process of decay,
or the condition and nature of the goods.
2. War, invasion, act of foreign enemy, hostilities or warlike operations
(whether war be declared or not), civil war, mutiny, civil commotion
assuming the proportions of or amounting to a popular rising,
insurrection, rebellion, revolution, military or usurped power, or any
act of any person acting on behalf of or in connection with any
organization with activities directed towards the overthrow by force of
the government de jure or de facto or to the influencing of it by
terrorism or violence; including any consequences thereof that occur
either directly or indirectly.
In any action suit or other proceedings, where the Company alleges that by
reason of the provisions of the Condition any loss or damages is not
covered by this Insurance, the burden of that such loss is covered shall
be upon the Insured.
3. Riot, strike, malicious actions, impact by vehicle, smoke, earthquake,
volcanic erruption, flood, inundation, windstorm, tempest, water damage,
removal of debris, loss of profit as a consequence of fire; except where
specifically insured.
4. Nuclear reactions, nuclear radiation or pollution by radio activity,
regardless of whether such processes occur inside or outside the premises.
Unless otherwise expressly stated in this Policy, this Insurance does not cover:
- - goods held in trust or on commission
- - bullion or unset precious stones
- - any curiosity or work of art for an amount exceeding Rp. 500,000
- - manuscripts, plans, drawings or designs, patterns, models or moulds
- - securities, obligation or documents of any kinds, stamps, coined or paper
money, cheques, books of accounts or other business books, and computer
systems records
<PAGE> 20
-3-
POLICY CONDITIONS
I. PAYMENT OF PREMIUMS
1. Notwithstanding the provisions of Article INLEGIBLE of the
Commercial Code (Kitab INLEGIBLE) the Insuance and any renewal
thereof shall come into force on the commencing date stipulated in
the Schedule of any anniversary thereof provided the Premium is paid
within fourteen (14) days of such date.
2. If the Premium is not paid within fourteen (14) days of the date of
commencement of renewal of this Policy the coverage will be
suspended and the Insured shall lose all rights to any indemnity as
from the date of commencement or renewal as stated in this Policy
and or attachment thereto.
The (INLEGIBLE) shall be reinstated twenty four (24) hours after the
payment of the Premium and the Insured shall not be entitled to any
refund of Premium or any extension of the period of coverage in
consequence of the period of such suspension. The Insurer is not
obliged to give any notice of suspension of cover under the terms of
this Condition.
II. OTHER INSURANCE
1. Prior to the Attachment of this Insurance the Insured shall give
notice to the Insurer of any Insurance or Insurances already
effected on the property and/or interests.
2. If subsequent to the attachment of this insurance other insurance is
effected on the same property and/or interests the Insured is
obliged to make this disclosure thereof to the insurer.
III. ALTERATION TO RISK
1. If changes or alterations are made to the insured buildings or to
the premiums where the insured goods are stored, or if part of the
premises of the entire premises are used for other purposes, or if
other goods are stored at the premises which increases the risk of
fire or explosion and the Insured knows or should have known about
this, then the Insured is obliged to immediately notify the insurer.
2. Upon the receipt of such notification the Insurer shall have the
right to determine whether or not the Policy may be continued on the
basis of the existing Premium or whether a higher Premium should be
charged or whether the Policy should be terminated. In the event of
such termination the insured shall be entitled to receive a refund
of Premium for the unexpired period of insurance.
IV. REMOVALS AND CHANGE OF OWNERSHIP
1. This insurance shall (INLEGIBLE) to attach to any items which have
been removed to premises other than those mentioned in the Policy
unless the Insurer has agreed to such removal by written endorsement
in the Policy.
2. Notwithstanding the provisions of Article 202 of the Commercial Code
(Kitab Undang-Undang Hukum (INLEGIBLE) when there is a change of
ownership of the insured property and/or interests, whether on the
basis of agreement or due to the death of the Insured, this
Insurance shall automatically become void ten (10) days after such
change of ownership unless the Insured has agreed in writing to
continue the insurance.
V. OBLIGATIONS OF THE INSURED IN THE EVENT OF LOSS OR DAMAGE.
1. The insured, upon knowledge or when it could be regarded that he
should have known about the occurence of loss of damage to property
or interest insured by this Policy must
(a) immediately inform the Insurer
(b) within seven (7) days give a written report containing all
known facts concerning the loss of damage including
information as to the cause or causes of the damage or loss to
the best of his knowledge or assumption. Such report should
contain as (INLEGIBLE) an account as may be reasonably
practicable of all the several articles or items of property
lost, damaged or destroyed as well as an account of all
insured property which is not affected by such loss or damage.
2. At the time of the loss of damage the Insured is obliged:
(a) to the best of his ability, safeguard the insured property and
authorities other people to assist and safeguard the property.
(b) to provide full support to the insurer or his representatives
or any other party appointed by the Insurer to conduct an
investigation of the loss or damage.
(c) to safeguard all salvageable property.
All rights to indemnification under this Policy shall be forfeited
if the Insured fails to comply with the above requirements.
VI. LOSS REPORTING
When filing a claim under this Policy the Insured must:
(a) submit the Policy together with an official report of the incident
from the (INLEGIBLE) the local police and/or other competent
authority.
(b) deliver a detailed report explaining as completely as possible the
circumstances that according to his knowledge have caused the loss
or damage.
(c) supply any other information and evidence as requested by the
Insurer.
VII. INDEMNITY
1. In the event of loss or damage to the insured property and/or
interests the maximum liability of the Insurer shall be limited to
the (INLEGIBLE) insured specified in the Schedule.
2. The basis of the calculation of the Indemnity shall be a comparison
of the value prior to the loss or damage and the value of any
(INLEGIBLE) immediately after the loss.
VIII. LOSS OF OR DAMAGE TO MOVABLE ITEMS
In the event of loss or damage to movable items, the Insured is obliged
within fourteen (14) days to:
1. (a)- For Furniture and/or Household Goods; property and submit
(INLEGIBLE) containing the type of each item and estimated
values immediately prior to the loss or damage as well as a
list containing the salvage values of the items.
(b)- For Raw Materials and Merchandise:
prepare and submit a list containing estimated values of each
and every item immediately prior to the loss or damage as well
as a list containing the INLEGIBLE values.
(c)- submit books and relevant documents as may be requested by the
Insurer or if not available, invoices, notes, or any document
that can be used as part of the loss or damage.
2. (a)- If the insured object is described by the general items of
"furniture and household goods, machinery", or "goods, wares
and merchandise", such furniture and household goods,
machinery or goods, wares and merchandise which are at the
time of the fire of the place mentioned in the Policy will be
covered by the Insurance, whether they were there at the "time
the Insurances was affected or not.
(b)- If the kind of each of the insured items is specified, the
previous paragraph will only be valid when those items
are present at the premises at the moment of the loss or
damages.
(c)- The preceding provisions shall not apply to objects which
owing in their description in the Policy or the
valuation in the Policy are to be considered as irreplaceable.
IX. INDEMNIFICATION OF MULTIPLE INSURANCE - CONTRIBUTION
1. Notwithstanding anything to the contrary in the provisions of
Article 277 page 1 of the Commercial Code (INLEGIBLE) in the event
of loss of or damage to property or interest insured by this Policy
where such property or interest to be insured by any other Policy or
Polices and the total Sum Insured under all (INLEGIBLE) exceeds the
actual value of the property of (INLEGIBLE) the Sum Insured under
this Policy will be reduced in proportion to the total Sum Insured
against the actual value of the property or interest of the Insured
shall not be entitled to a reduction or refund of premium.
2. Nothwithstanding anything to the contrary contained in paragraph 1
above the provisions of Article 377 of the Commercial Code
(INLEGIBLE) shall apply in the event that any or all of the other
insurances precede the effective date of this Policy and do not
contain a similar contribution (INLEGIBLE.
3. In the event of loss or damage the Insured is obliged at the request
of the Insurer to submit a written declaration of any other
insurance covering the same property or insured.
<PAGE> 21
-4-
X. UNDER INSURANCE
If the property or interest here by insured shall, at the time of loss or
damage be collectively of greater value than the Sum Insured there on then
the Insured shall be considered as being his own insurer for the
difference and shall bear a rateable proportion of the loss
accordingly. Every item, if more than one, of the Policy shall be
separately subject to this condition.
XI. FRAUDULENT REPORTS
If the Insured deliberately increases the amount of loss allegedly
suffered or includes items that did not exist at the time of loss or
damage or (INLEGIBLE) items or part of the salvable items and reports that
those items had been destroyed, or uses false documents/evidence or makes
fraudulent statements to support his claim for the loss suffered or by
serious mistake or negligence beyond reason burns/explodes/destroys or
give orders to burn/explode or destroy or causes
fire/explosion/destruction, he shall lose the right for indemnification.
VII. ASSESSMENT OF ESTIMATED VALUE IN THE EVENT OF A CLAIM
1. The estimated value shall be based on the real value of the property
without adding any profit.
2. In the assessment of the value of buildings no account shall be
taken of their location or occupation.
3. Unless specifically mentioned, foundations and underground
construction shall not be included in the value assessment.
4. The amount of loss as mentioned above shall be estimated on the
basis of assessment made by one or more assessors approved by both
parties, and result of the assessment shall be binding on both
parties, unless one of the parties can prove that the assessment is
based on false information or wrong calculation in which case the
Insurer or the Insured is entitled to request an investigation.
5. Goods, materials and merchandise will be assessed on the basis of
their cost price immediately prior to the occupation of the loss or
damage.
XIII. REIMBURSEMENTS
a. In the case of loss, service fees and honoraria for the assessors
and other experts who are appointed on the basis of agreement
between the Insurer and the Insured, will be paid by the Insurer.
b. Reasonable expenses incurred to prevent or reduce losses (whether
successful or not) disbursed by the Insured in accordance with
Condition V paragraph 2 and Condition V paragraph 2 and Condition
XIV paragraph 2, shall be reimbursed by the Insured.
XIV. SALVAGE
In the event of loss or damage:
1. the salavage, if any, is the responsibility of the Insured
2. The Insurer is entitled to request the Insured to store all or part
of the salvage.
3. It is stipulated that any action on the part of the Insurer
including a request to store the salvage as mentioned above, can by
no means be considered as an acknowledgement of any responsibility
whatsoever.
XV. INDEMNIFICATION
The Insurer is obligated to pay in full the indemnity within six (6) weeks
after an agreement on the amount of the indemnity has been reached.
XVI. SUBROGATION
1. In accordance with Article 284 of the Commercial Code ( INLEGIBLE),
upon payment of indemnity on the property and/or interests insured
by this Policy, the Insurer will replace the Insured as regards any
rights that he has against a third party concerning the loss.
Subrogation as mentioned in the above paragraph will be automatically
valid without any letter of authorization from the Insured.
2. The Insured remains responsible for any action that could possibly
affect the rights of the Insurer against a third party.
XVII. REINSTATEMENT OF THE SUM INSURED
Upon payment of indemnity in the event of loss of or damage to the insured
property and/or interests, the amount of the indemnity will be deducted
from the Sum Insured.
After restoration of the damage the Insured can request reinstatement of
the Said Insured by paying additional premiums.
XVIII. FORFEITURE OF RIGHT TO INDEMNIFICATION
The right of the Insured or indemnification for loss or damage will be
automatically forfeited if no claim has been submitted within twelve (12)
months of the occurrence of loss or damage.
XIX. TERMINATION OF THE INSURANCE
1. Both the Insurer and the Insured are entitled to terminate this
insurance at any time without giving reason therefor. Such
termination shall be affected by registered letter. The insurer is
relieved from all liability under this Policy twenty four (24) hours
after the date of dispatch of the registered letter.
2. When the Insurer terminates the insurance, he is obliged to return
(INLEGIBLE) premium for the unexpired period of Insurance. If it is
the Insured who terminates the insurance, premium will be calculated
on the short term rate laid down in the current Fire Insurance
Tariff of Indonesia for the completed period of Insurance.
XX. RETURN PREMIUM
The Insured shall have no right to any return of Premium except as
described in Conditions III, IV and XIX.
XXI. DISPUTES
1. Any condition or provision contained in this Policy notwithstanding,
it is understood and agreed that all disputes resulting from the
performance and/or interpretation of this agreement of insurance are
to be submitted to three Arbitrators whose award shall be final and
binding.
2. The party desiring to submit a case to arbitration must give the
other party notice of his intention in writing. The three
Arbitrators shall be appointed by both parties by mutual agreement.
If within four weeks from the date of such written notice the
parties are unable to agree on the selection of the Arbitrators, the
most ready party may request the Chairman or in his absence the
acting Chairman of the Association of Insurance Companies in
Indonesia to nominate the Authority which is to appoint the
Arbitrators.
3. The Arbitrators are bound to pronounce on the issues before them in
a just and equitable manner.
4. The Arbitrators shall determine the Rules of the Arbitral
Proceedings.
5. In their final Award the Arbitrators shall (INLEGIBLE) by
which party or parties the costs of the Arbitral Proceedings
including the disbursements and the fees of the Arbitrators and the
fees and disbursements of the lawyers representing the parties,
shall be wholly or partially borne.
6. The Arbitrators shall take the necessary measures in order that the
original of the Award shall be filed at the Local Court of
(INLEGIBLE) jurisdiction, in which city the Award(s) shall be made.
7. The powers to be granted of the Arbitrators shall continue until
after the filing referred to is the above-mentioned stipulation 6.
XXII. CONCLUSION
Matters which may not be sufficiently provided for in this Policy shall be
subject to the provisions of the Commercial Code (Kitab Undang - Undang
Mukum Dagang).
<PAGE> 22
-5-
The Endorsement is attached to and forms an integral part of:
Policy Number : 02-19-20000868/00
Insured's Name : PT. DYNACS DIGITAL STUDIOS
It is hereby agreed and declared that:
a) Notwithstanding anything contained in Chapter 11-EXCEPTIONS. Item 1.3.1.
of this Policy to the (IN LEGIBLE) and subject to payment of additional
premium, the insurer agrees to extend this insurance as provided in this
Endorsement:
b) Notwithstanding anything which may be defined in any laws or regulations
to the contrary, for the purpose of this Endorsement, all terminology
printed in italics shall be deemed to mean as defined in CHAPTER III -
DEFINITIONS of the Policy.
1. EXTENSIONS
This insurance is extended to cover:
- Physical damage to the property and/or interest insured directly
caused by one or more of the following perils:
1.1. Riots
1.2 Strikes
1.3. Locked-out Workers
1.4 Malicious Acts
1.5 Preventive Acts
- Physical loss of the property and/or interest insured directly
caused by:
1.6 Looting occurring during RIOTS
Provided that any of these perils does not develop in an uninterrupted
chain of events into one or more of the excluded perils.
2. EXCLUSIONS
This extension does not cover all physical loss of or damage to the
property and/or interest insured including loss or damage by fire directly
or indirectly caused by or contributed to by or arising from or in
consequence of one or more of the following perils:
2.1 CMI Commotions, insurrection/Popular Rising, Usurped Power,
Revolution, Rebellion, Military Power, invasion, Civil War and
Hostilities, Subversive Acts, Terrorism, Sabotage or Looting
(except Looting occurring during Riots).
In any action, suit or other proceedings, where the insurer alleges
that loss or damage is directly or indirectly caused by one or more
of the excluded perils under this Section, the burden of proof that
such loss or damage is covered shall be on the insured.
2.2 Total or Partial cessation of works, or retarding or interruption or
cessation of any process or operation.
2.3 Permanent or temporary dispossession resulting from confiscation,
commandeering or requisition by any lawfully constituted authority
or body, or unlawful occupation by any person.
2.4 Business interruption, of any kind of consequential loss.
3. DEDUCTIBLES
The Insured shall bear 15% (fifteen per cent) of the adjusted loss subject
to minimum of Rp. 10,000,000 -- (ten million Rupiah) for each claim
payable under this Endorsement.
4. MEMORANDUM
For the purpose of this Endorsement Item 18 CHAPTER III - DEFINITIONS of
this Policy is and replaced with the following:
18. Looting is the appropriation of property belonging to another by any
person (excluding those employed by or under the control of the
insured), with the intention of permanently depriving that other of
it.
All other terms and conditions of the Policy remain unchanged.
(This wording is a translation of the original version in Bahass Indonesia; in
the event of any dispute arising from the interpretation of any meaning herein,
the Terms and Conditions shall be interpreted according to the original Bahass
Indonesia version).
/s/ [ILLEGIBLE]
<PAGE> 23
[LOGO] ASURANSI WAHANA TATA
--------
ORIGINAL
--------
----------------------------------
BURGLARY
INSURANCE
POLICY Nr. 04-19-20000009/00
----------------------------------
----------
PT. ASURANSI WAHANA TATA
BATAM BRANCH
----------
<PAGE> 24
[LOGO] ASURANSI WAHANA TATA Original
---------------------------
BURGLARY INSURANCE
Policy Nr : 04-19-20000009/00
Assured (s) : PT. DYNACS DIGITAL STUDIOS
Address : Jalan Angsana Lot. 308, Batamindo Industrial Park
Muka Kuning - Batam
Period of Insurance : 12 (twelve) months
Commencing : 29th May 1999 until May 2000
12:00 o'clock Noon local time at the
location of the Insured object.
Property Insured : 1. Office Equipments SGD. 7,000.00
2. Machineries SGD. 643,000.00
Location of Risk : Jalan Angsana Lot.308, Batamindo Industrial Park
Muka Kuning-Batam
Total Sum Insured : SGD 650,000.00
Premium Calculation:
SGD.650,000.00 x 1.00% = SGD. 6,500.00
Administration Cost... = SGD. 2.86
Stamp duty..............= SGD. 0.44
-------------
SGD. 6,503.30
-------------
Batam, 31st May 1999
Signature of the Insurer
PT. ASURANSI WAHANA TATA
/s/ [ILLEGIBLE]
<PAGE> 25
[LOGO] ASURANSI WAHANA TATA Original
---------------------------
THE DESCRIPTION OF OFFICE EQUIPMENTS AND MACHINERIES
ATTACHING TO AND FORMING PARTS OF
BURGLARY INSURANCE POLICY NO. 04-19-200000009/00
A. OFFICE EQUIPMENTS )
- Office Table )
- Office Chair )
- Filing Cabinet )
- Cupboard )
- Photo Copy Machine ) B.S. 7,000
- Fax Machine )
- Safe )
- Sanyo Bridge )
- HP Printer Laser Jet 1100 )
- Decoration Painting )
B. MACHINERIES
- Ranger Computer 101 Nos )
- DDR (Server) 4 Nos )
- 19' Sony Color Monitor 134 Nos )
- 20' High Resolution Monitor 3 Nos )
- Key Board and Mouse 156 Nos ) S.S. 643,000
- Philip 20' Color TV 1 Nos )
- Philip VCR 1 Nos )
- Compressor )
[ILLEGIBLE]
P.T. ASURANSI WAHANA TATA
/s/ [ILLEGIBLE]
<PAGE> 26
[LOGO] ASURANSI WAHANA TATA
- ---------------------------
BURGLARY
WHEREAS, the Insured has made to the Insurer named in the schedule (hereinafter
called the "Company") a Proposal and Declaration or furnished certain
information which shall be the basis of this contract and which is deemed to be
incorporated herein and has paid or agreed to pay the Premium stated in the
aforesaid schedule as consideration for the Indemnity hereinafter contained.
NOW THIS POLICY (INLEGIBLE) that if at any time during the Period of Insurance
stated in the schedule hereto or during any further period for which the Company
may accept payment for the renewal or extension of this Policy.
A. The property or any part, thereof within the Premises shall be stolen or
damaged by any person not being an employee of the Insured who:
I. Breaks and enters the premises while they are securely locked or,
II. Breaks out of the premises, while they have been securely locked,
after having committed a crime therein or,
III. At the Premises commits theft accompanied by violence or threat of
violence to any person on the premises where such violence or threat
is used to extort the property stolen or to prevent or overcome
resistance to its being stolen or
B. There shall arise any damage to the premises falling to be borne by the
Insured due to the action of such persons as aforesaid or any attempt
thereat.
Then the Company will subject to the Terms, Exceptions, Limits and Conditions
contained herein or endorsed hereon, indemnity the Insured against
a) Such loss to the extent of market value at time of the loss (not including
profit of any kind ) and/or
b) The net cost of repairing such damage.
but not exceeding in respect of any one item specified in the schedule the Sum
Insured thereon nor in the whole during any one period of Insurance such total
Sum Insured.
PROVIDED ALSO that the Premises mentioned in the schedule shall not include any
yard, garden, outbuilding, or other appurtenances unless specifically included
in the schedule hereto.
EXCEPTIONS
The Company shall not be liable in respect of :
(a) Loss or damage due to any attempt thereat by or in collusion with any
members of the Insured's staff or family or tenant or any person lawfully
on the Premises.
(b) Damage to glass or any decoration or lattering or alarm tapes thereon.
(c) Loss or Damage occasioned by fire or explosion.
(d) Loss of damage to medals, coins, curiosities, sculptures, manuscripts,
rate books, plans, patents, models, moulds, designs, deeds, bonds, bills
of exchange, promissory notes, money, securities for money, stamps,
documents of title or business books unless specifically included in the
schedule.
(e) Loss or damage directly or indirectly caused by war, invasion, act of
foreign enemy, hostilities (whether to be declared or not), civil war,
rebellion, revolution, insurrection, riot, strikes, civil commotion,
military or usurped power, or confiscation or destruction by order of any
Government or Public Authority and in the event of any claim hereunder the
Insured shall prove that the claim arose independently of and was in no
way connected with or occasioned by or contributed to by or traceable to
any of the aforesaid occurrences or any consequence thereof and in default
of such proof the Company shall not be liable to make any payment in
respect of such a claim.
(f) Loss or damage to any property whatsoever or any loss of expense
whatsoever resulting from or arising therefrom or any consequential loss
or any liability of whatsoever nature:
(i) Directly or Indirectly caused by or contributed to by or arising
from (INLEGIBLE) radiations or contaminations by radio activity from
any nuclear fuel or from any nuclear waste from the combustion of
nuclear fuel. For the purpose of the exception combustion shall
include any self-sustaining process of nuclear fission.
(ii) Directly or Indirectly caused by or contributed to by or arising
from nuclear weapons material.
(g) Loan or damage arising whilst the premises are unoccupied for a period
exceeding 30 consecutive days or are occupied otherwise than as stated in
the schedule unless the written consent of the Company shall have
previously been obtained and any additional premium required by the
Company has been paid.
/s/ [ILLEGIBLE]
<PAGE> 27
[LOGO] ASURANSI WAHANA TATA
- ---------------------------
CONDITIONS
1. Immediately upon the happening of any event giving rise or likely to give
rise to claim under this Policy, the insured shall:
(a) give notice to the Police and render all reasonable assistance in
causing the discovery and punishment of any guilty person or persons
and in trading and recovering the property.
(b) Give notice thereof to the Company in writing and within 14 days
thereafter delivery to the Company a claim in writing and apply all
such detailed particulars, proofs and evidence in support of such a
claim as may be reasonably required by the Company.
In no case shall the Company be liable for any loss not notified to the Company
within 14 days after the event.
2. The Insured shall take all reasonable precautions for the safety of the
property insured as regards selection and supervision of employees
securing all doors and windows and other means of entrance or otherwise.
3. The Company may at any time at its own expense use all legal means in the
name of the Insured for the recovery of the property lost or its value and
the Insured shall give all reasonable assistance for that purpose the
Company shall be entitled to any property for the loss of which a claim is
paid hereunder and the Insured shall execute all such assignments of such
property as may be reasonably required. The Insured shall not be entitled
to abandon any property to the Company.
4. All notice required to be given by the Insured to the Company must be in
writing addressed to the Company and no alteration in the terms of this
Policy nor any endorsement thereon will be held valid unless the same is
signed or initialed by an authorized representative of the Company.
5. If the Property Insured shall at the time of any event giving rise to a
claim under this Policy be collectively of a greater value than the Sum
Insured thereon, then the Insured shall be considered as being his own
Insurer for the difference and shall bear a rateable proportion of the
loss accordingly. Each item in the schedule hereto shall be separately
subject to this condition.
6. This Policy may be canceled by the Insured at any time by notice in
writing delivered to the Company in which case the Company shall retain or
be entitled to recover as the case may be, the customary short term
premium or minimum premium for the time during which the Policy has been
in force the Company may at any time by giving written notice to the
Insured cancel this Policy. Notice of cancellation may be delivered
personally or posted by registered letter to the Insured at his or its
address last known to the Company and the cancellation of the Policy shall
be effective as on the seven day after posting of personal delivery by the
Company. After cancellation by the Company as aforesaid the Company will
on application by the insured refund the amount of unearned premium on a
pro-rata basis subject to any adjustment of premium as may be required by
the terms or conditions of this Policy.
7. If the proposal or declaration of the Insured is untrue in any respect or
if any material fact reflecting the risk be incorrectly stated therein or
omitted therefrom or if this Insurance or any renewal thereof shall have
been obtained through any mid-statement misrepresentation or suppression
or if any claim made shall be fraudulent or exaggerated or if any false
declaration shall be made in support (thereof then, in any of these cases,
this Policy shall be void.
8. If at the time of the happening of any loss or damage covered by this
Policy there shall be subsisting any other Insurance of any nature
whatsoever covering the Property insured or any part thereof, whether
effected by the Insured or not, then the Company shall not be liable to
pay or contribute more than its rateable portion of any loss or damage.
Each item of this Policy shall be separately subject to this condition.
9. Nothing contained herein shall give any rights against the Company to any
person other than the Insured, and the Company will not be bound by any
passing of the interest of the Insured otherwise then by death, unless and
until the Company shall by endorsement hereon declare the Insured to be
continued.
10. If any difference shall arise as to the amount to be paid under this
policy (Liability being otherwise admitted) such difference shall be
referred to an arbitrator to the appointed in accordance with the
statutory provisions in that behalf for the time being in force. Where any
differences is by this condition to be referred to arbitration the making
of an award shall be a condition precedent to any right of action against
the Company, unless any such action or suit be commenced within six months
of the making of an award the Company shall not be liable to make any
payment in excess of the amount of the award.
11. In no case whatever shall the Company be liable for any loss or damage
after the expiration of twelve months from the happening of the loss or
damage unless the claim is the subject of pending action or arbitration.
12. The due observance and fulfillment of the terms conditions and endorsement
of this Policy insofar as they relate to anything to be done or complied
with by the Insured and truth of the statements and answers in the said
proposal shall be conditions precedent to any liability of the Company
make any payment under this Policy.
/s/ [ILLEGIBLE]
<PAGE> 28
FACTORY LEASE AGREEMENT
TYPE C FACTORY
THIS AGREEMENT is made the 3rd day of November 1998 BETWEEN:
I. PT BATAMINDO INVESTMENT CORPORATION, a company duly incorporated under the
laws of Indonesia and having an office at Wisma Batamindo, Jalan Rasamala
No. 1, Batamindo Industrial Park, Mukakuning, Batam 29433, Indonesia
(hereinafter called "BIC");
AND
II. DYNACS DIGITAL STUDIOS PTE LTD, a company duly incorporated under the laws
of Singapore and having its principal place of business at No. 2, Leng Kee
Road, #04-01, Thye Hong Centre, Singapore 159086 (hereinafter called the
"Lessee").
WHEREAS
A. BIC is the developer of an industrial estate located at Mukakuning, Batam,
Indonesia, namely Batamindo Industrial Park (hereinafter called "BIP");
B. The Lessee desires to lease and to operate a factory in BIP.
NOW THEREFORE the parties hereto agree as follows:-
ARTICLE 1
LEASE PREMISES
BIC agrees to lease to the Lessee and the Lessee agrees to take a lease from BIC
of factory premises at Lot 308 of BIP with a total lettable area of
approximately 972 square metres subject to final survey, if any, as marked red
in the plan attached hereto as Schedule 1 (hereinafter called the "Lease
Premises").
ARTICLE 2
UTILISATION OF THE LEASE PREMISES
2.1 The Lessee shall utilise the Lease Premises to operate a factory in
conformity with its business permit obtained from the Coordinating Board
of Capital Investment (BKPM) and for no other purposes whatsoever.
(Initials)
1
<PAGE> 29
2.2 Any material alteration of the Lessee's utilisation of the Lease Premises
shall require prior written approval from BIC. The Lessee shall also
obtain approvals from the relevant authorities if necessary.
ARTICLE 3
LEASE TERM & DELIVERY OF LEASE PREMISES
3.1 The lease term (hereinafter called the "Lease Term") shall be for a fixed
term of three (3) years commencing from 3 November 1998 (hereinafter
called the "Lease Commencement Date").
3.2 Upon the expiry of the Lease Term, this Lease Agreement shall be
automatically renewed for a further term of three (3) years and shall
continue to be automatically renewed for the same term of years at the
expiry of each renewed term unless either party notifies the other in
writing not less than six (6) months prior to the expiration of the Lease
Term or each renewed term, as the case may be, that this Lease Agreement
shall not be renewed. Notwithstanding the foregoing, this Lease Agreement
shall automatically terminate when BIC's tenure or right to the land of
the Lease Premises is terminated or expires. In such an event, BIC shall
not be liable for any loss or damage which may result.
3.3 Notwithstanding the preceding clause, the rental the Lessee is liable to
pay to BIC during each renewed term shall be BIC's listed standard rentals
prevailing at the date of each renewal.
3.4 Physical Possession of the Lease Premises shall be given to the Lessee on
the Lease Commencement Date. Notwithstanding the foregoing, physical
possession need not be given where the deposit referred to in Article 6
has not been paid to BIC in full but in such an event the Lease Term shall
still commence on the Lease Commencement Date and all payments due under
this Lease Agreement shall be due accordingly.
ARTICLE 4
RENTAL
4.1 The rental for the Lease Premises is Singapore Dollars Nine Thousand Seven
Hundred and Twenty (S$9,720) per month (hereinafter called the "Rental")
calculated as follows:-
2 2
S$10 per m per month x 972 m lettable area
4.2 The Rental shall commence on the Lease Commencement Date and shall be paid
by the Lessee to BIC within fourteen (14) days of BIC's invoice date. Each
invoice sum shall be for an amount not exceeding three (3) month's Rental.
Where there is a failure to pay on the due date, Article 7 shall apply.
(Initials)
2
<PAGE> 30
4.3 Notwithstanding the preceding clause, no Rental shall be due for the 1st,
2nd, 23rd, 24th, 35th and 36th month of the Lease Term. This clause shall
not apply upon any renewal of this Lease Agreement in accordance with
Article 3.2.
ARTICLE 5
SERVICE CHARGE
5.1 In addition to the Rental, the Lessee shall pay BIC a service charge of
Singapore Dollar One and Cents Ten only (S$1.10) per square metre of the
area of 1206 square metres per year (hereinafter called the "Service
Charge") for the maintenance of the common areas more specifically set out
in Schedule 2.
5.2 The Service Charge shall be reviewed and revised by BIC from time to time.
5.3 The Service Charge shall commence on the Lease Commencement Date and shall
be paid by the Lessee to BIC within fourteen (14) days of BIC's invoice
date. Each invoice sum shall be for an amount not exceeding three (3)
month's Service Charge. Where there is a failure to pay on the due date,
Article 7 shall apply.
ARTICLE 6
DEPOSIT
6.1 The Lessee shall pay BIC a cash deposit equivalent to three (3) month's
Rental (hereinafter called the "Deposit") on or before the Lease
Commencement Date as security against breach of any of the terms and
conditions in this Lease Agreement.
6.2 Where the Lessee fails to pay the Rental or the Service Charge or any
other payments required to be paid under this Lease Agreement or breaches
any other terms and conditions in this Lease Agreement, BIC is entitled to
use the Deposit or any part thereof for the settlement of such unpaid
payments or to compensate for damages or expenses resulting from such
breach without prior notification to the Lessee and without prejudice to
other remedies available to BIC.
6.3 Where the Deposit or any part thereof is utilised by BIC in accordance
with Article 6.2,the Lessee shall immediately pay to BIC in cash a
sufficient amount to compensate for the Deposit or part thereof which have
been utilised by BIC as aforesaid. Such compensation shall be paid within
seven (7) days of BIC's written demand failing which Article 7 shall
apply.
6.4 Where the Rental has been increased in accordance with this Lease
Agreement, the Lessee shall pay the amount of such increase within thirty
(30) days of BIC's written demand so that the Deposit shall at all times
be equal to three (3) month's Rental. Where there is a failure to pay on
the due date, Article 7 shall apply.
6.5 The Lessee is not entitled to request that the Deposit be used to pay for
or discharge any of its obligations under this Lease Agreement.
(Initials)
3
<PAGE> 31
6.6 The Lessee is not entitled to transfer, assign or create any security over
its interest in the Deposit or any part thereof to any third party.
6.7 Subject to other provisions in this Lease Agreement, the Deposit shall be
repaid to the Lessee without interest within thirty (30) days of the
termination or expiration of this Lease Agreement PROVIDED THAT the Lessee
has surrendered the Lease Premises in the condition it is obliged to
surrender the said premises and there being no existing breach of the
terms and conditions of this Lease Agreement.
ARTICLE 7
LATE OR NON-PAYMENT
7.1 Where the Lessee fails to pay on the due date the Rental, Service Charge,
any shortfall in the Deposit the Lessee is obliged to make good or any
other payments required under this Lease Agreement, or any part of the
foregoing, the Lessee is obliged to pay interest on the overdue sum at ten
(10) per cent per annum from the due date until payment is received by
BIC.
7.2 Without prejudice to the preceding clause, where such payments or part
thereof remain outstanding, BIC is entitled to terminate this Lease
Agreement under Article 8.2.1.
7.3 Without prejudice to the foregoing clauses, where such payments or part
thereof remain outstanding for more than thirty (30) days BIC may
terminate all supply of electricity and water to and the use of telephone
and facsimile facilities by the Lease Premises without being liable for
any losses or damages resulting therefrom.
ARTICLE 8
TERMINATION
8.1 The Lessee is entitled to terminate this Lease Agreement prior to the
expiry of the Lease Term by giving not less than six (6) months written
notice of its intention to BIC. For such termination, the Lessee is not
entitled to the refund of the Deposit or any Rental or Service Charge or
other payments paid in advance or already made to BIC.
8.2 BIC is entitled to terminate this Lease Agreement immediately by written
notice in the following cases:-
8.2.1 Where the Rental, Service Charge, Deposit or any shortfall
thereof, or any other payments required under this Lease
Agreement, or any part of the foregoing remains unpaid by the
Lessee for thirty (30) days after its due date;
8.2.2 Where the Lessee breaches any other terms and conditions of this
Lease Agreement and the Lessee fails to rectify such breach within
thirty (30) days after BIC's written notice to the Lessee to so
rectify;
(Initials)
4
<PAGE> 32
8.2.3 Where the Lessee breaches Article 12 (w);
8.2.4 Where the Lessee is in breach of any prevailing laws or
regulations including but not limited to the regulations of the
Batam Industrial Development Authority;
8.2.5 Where the Lessee's activities are suspended or prohibited by the
authorities or its licences or permits are suspended or revoked;
or
8.2.6 Where any insolvency or bankruptcy proceedings whether within or
outside any court are commenced by or against the Lessee.
8.3 Where BIC terminates under Article 8.2, the Lessee is not entitled to the
refund of the Deposit or any Rental or Service Charge or other payments
paid in advance or already made to BIC.
8.4 For termination under this Article or any other Article in this Lease
Agreement:-
8.4.1 there is no necessity to comply with the provisions of Article
1266 Indonesian Civil Code requiring reference to a judicial body
for such termination, which provisions the parties waive;
8.4.2 such termination is without prejudice to the accrued rights of
either party or to their rights in respect of any antecedent
breach;
8.4.3 such termination is without prejudice to other remedies available
to the parties under this Lease Agreement or otherwise.
ARTICLE 9
SURRENDER OF LEASE PREMISES
9.1 At the expiration of the Lease Term or any renewed term or the termination
of this Lease Agreement, the Lessee shall immediately surrender the Lease
Premises to BIC in the condition BIC delivered possession of the Lease
Premises to the Lessee, normal wear and tear excepted.
9.2 Where the Lessee fails to surrender the Lease Premises on the expiration
of the Lease Term or the termination of this Lease Agreement, the Lessee
shall pay BIC double the Rental for the period the Lessee continues to
occupy the Lease Premises after such expiration or termination. Nothing in
this clause shall prejudice BIC's rights at law including, without
limitation, rights to evict the Lessee.
(Initials)
5
<PAGE> 33
ARTICLE 10
MAINTENANCE AND REPAIR OF LEASE PREMISES
10.1 The Lessee shall maintain the Lease Premises and repair all the damage
sustained by the Lease Premises except for fair wear and tear, keep the
Lease Premises including lavatories tidy and clean and keep its own
environmental security at its own cost and responsibility.
10.2 BIC is entitled to access and to inspect the Lease Premises at all
reasonable times to ascertain whether the Lessee has utilized and
maintained the Lease Premises in accordance with this Lease Agreement.
ARTICLE 11
INSURANCE
11.1 BIC shall insure the buildings of the Lease Premises including its annexes
against loss risk or damage caused by fire or other cause on BIC's account
during the Lease Term or any renewed term under this Lease Agreement.
11.2 The Lessee is obliged to insure its property located in the Lease Premises
against loss risk or damage caused by fire or other cause and insure its
employees and/or staff against accident for whatsoever reason. The Lessee
hereby holds BIC harmless from any consequences arising out of such
events.
ARTICLE 12
LESSEE'S OTHER COVENANTS
The Lessee hereby agrees as follows:-
(a) to use the Lease Premises in compliance with the utilization of BIP as
decided by the authorities;
(b) to obtain all necessary licenses to operate in BIP;
(c) to pay all taxes and other charges (except building and property taxes)
related to its operation and the possession of the Lease Premises;
(d) not to use any flammable building materials for internal partitioning or
to store any dangerous, flammable or obnoxious substances within or
without the Lease Premises;
(e) not to modify any existing electrical wirings or modify or replace any
existing fire alarm fixtures and fittings or affix or install any further
or additional electrical and fire alarm wiring extensions in or about the
Lease Premises without the written consent of BIC which consent shall not
be unreasonably withheld Provided Further That all such work shall be
carried out by a licensed electrical contractor or competent person as
approved by BIC to be employed and paid by Lessee who shall
(Initials)
6
<PAGE> 34
ensure as part of the work that the existing circuits and equipment are
not overloaded or imbalanced. Prior to any electrical and fire alarm
installation or modification work, Lessee will be required to submit the
necessary plans;
(f) to permit BIC or its agents with or without workmen or others at all
reasonable times and by prior appointment to enter the Lease Premises to
take inventories of BIC's fixtures and fittings therein or to view the
condition thereof and examine the state of repair of the Lease Premises
and thereupon BIC may give the Lessee notice in writing specifying any
work or repairs necessary to be done which are the responsibility of the
Lessee under the terms of this Lease Agreement and shall require the
Lessee forthwith to execute the same and the Lessee shall pay BIC's
reasonable costs of survey attending the preparation of the notice and if
the Lessee shall not within fourteen (14) days after the service of such
notice proceed diligently and in workmanlike manner with the execution of
such work or repairs then to permit BIC (who shall not be under any
obligation so to do) to enter upon the Lease Premises and execute such
work or repairs and the cost thereof shall be a debt due from the Lessee
to BIC and be forthwith recoverable Provided Always that BIC shall not be
liable to the Lessee for any loss damage or inconvenience caused by such
work or repairs, unless caused by any neglect, default or omission of BIC,
its servants or agents;
(g) to make good and sufficient provision for the safe and efficient disposal
of all waste and pollutants generated at the Lease Premises to the
requirements and satisfaction of BIC and/or relevant government
authorities (including but not limited to compliance with the Class 2
Standard for Effluent Discharge as required under BIDA's directive
027/KPTS-REN/11/1993) PROVIDED THAT in the event of any default by the
Lessee under this covenant BIC may carry out such remedial measures as it
thinks necessary and all costs and expenses incurred thereby shall
forthwith be recoverable from the Lessee as a debt;
(h) not to do or suffer to be done on or in the Lease Premises anything
whereby the insurances of the same or of the BIP or any part thereof may
be rendered void or voidable or whereby the premium thereon may be
increased and to repay to BIC on demand all sums paid by BIC by way of
increased premium and all expenses incurred by BIC in connection with
insurance rendered necessary by a breach or non-observance of this
covenant without prejudice to any other rights and remedies available to
BIC;
(i) not to do or permit or suffer to be done anything in or upon the Lease
Premises or any part of the BIP which in the opinion of BIC is a nuisance
or cause annoyance to or in any way interfere with the business or the
quiet or comfort of the other occupants of the BIP Provided That BIC shall
not be responsible to the Lessee for any loss, damage or inconvenience as
a result of nuisance, annoyance or any interference whatsoever caused by
the other occupants of the BIP;
(j) not to use the Lease Premises for any illegal or immoral purpose;
(Initials)
7
<PAGE> 35
(k) not to install any machinery or fixtures in the Lease Premises without
having sought the advice of its professional advisors and to submit a
layout plan of the Lessee's machinery for the approval of BIC and/or
relevant authorities prior to the actual fixing of the machinery Provided
That the Lessee shall be fully responsible for any installation of
machinery or fixtures and shall indemnify BIC from any losses arising
therefrom;
(l) not to assign sublet or part with or share the possession of the Lease
Premises or any part thereof; without the consent of BIC, which consent
shall not be unreasonably withheld;
(m) at the termination of the Lease Term to yield up the Lease Premises and
all BIC's fixtures fittings fastenings and other things thereto anywhere
belonging or appertaining in such good and substantial repair, fair wear
and tear excepted as shall be in accordance with the covenants of the
Lessee hereinbefore contained and with all locks and keys complete;
(n) not to install and/or use any electrical installations, machines or
apparatus that may cause or causes heavy power surge, high frequency
voltage and current, air borne noise, vibration or any electrical or
mechanical interference or disturbance whatsoever which may prevent or
prevents in any way the service or use of any communication system or
affects the operation of other equipment, installations, machinery,
apparatus or plants of other lessees and in connection therewith, to allow
BIC or any authorised persons to inspect at all reasonable times, such
installation, machine or apparatus in the Lease Premises to determine the
source of the interference or disturbance and thereupon, to take suitable
measures, at the Lessee's own expense, to eliminate or reduce such
interference or disturbance to BIC's satisfaction, if it is found by BIC
or such authorised person that the Lessee's electrical installation,
machine or apparatus is causing or contributing to the said interference
or disturbance;
(o) to indemnify BIC against any claims, proceedings, action, losses,
penalties, damages, expenses, costs, demands which may arise in connection
with Article (n) above;
(p) not to hold BIC responsible for any costs, loss of profits, or any
consequential losses;
(q) to comply with any prevailing laws and regulations in Indonesia;
(r) to comply with the BIP Estate Regulations including any amendments
thereto;
(s) not to modify or alter the Lease Premises without submitting to BIC the
revised layout and building plans of the Lease Premises for prior written
approval by BIC. Any alteration or addition to the Lease Premises after
approval by BIC should be done by contractors, approved by BIC and all the
expenses are for the account of the Lessee. The Lessee shall hold BIC
harmless from any claims, liabilities or losses arising therefrom. Any
improvement, addition, partition, or other improvements to the Lease
Premises shall be removed at the expiration of Lease Term or termination
of this Lease Agreement unless otherwise requested by BIC and agreed to by
the Lessee;
(Initials)
8
<PAGE> 36
(t) to pay all expenses and deposits for and in respect of the consumption of
electricity, water and the use of telephone and facsimile facilities,
including without limitation to the foregoing any connection expense
recovery, to BIC where BIC is the body supplying the same;
(u) where no time is stated in this Lease Agreement for any payments, the
Lease shall pay BIC such payments within the time stipulated in BIC's
invoice for the same, such time not to be less than fourteen (14) days
from the date of BIC's invoice;
(v) not to hold BIC liable for any losses or damages (including without
limitation to the foregoing any loss of profit or any consequential
losses) arising from any interruption, cessation, shortfall or variation
in electrical power, water supply and telephone and facsimile facilities.
(w) not to permit or suffer any change in the ownership or the shareholding
(whether legal or beneficial) of the Lessee or the transfer of any part of
its issued captial without the prior written consent of BIC.
All consequences arising from the non compliance of the abovementioned shall be
fully borne by the Lessee and the Lessee hereby indemnfies and holds
BIC harmless.
Without prejudice to BIC's other rights, in the event that the Lessee shall fail
to remedy any breach of the above obligations for a period of seven (7) days
after BIC's written notification of such breach, BIC, its employees, agents or
contractors shall be entitled (though not obliged) to enter upon the Lease
Premises and to take whatever remedial measures it or they deem fit without the
need to resort to judicial or arbitral proceedings and, in order to effect such
remedial measures, the Lessee hereby grants BIC an irrevocable power of attorney
with the right of substitution to enter upon the Lease Premises and to effect
such remedial measures with or without the assistance of the competent
authorities, at the expense of the Lessee and at no responsibility nor liability
on the part of BIC from the consequences which may arise therefrom.
ARTICLE 13
OTHER AGREEMENTS & ASSIGNMENT
13.1 This Lease Agreement and the rights and obligations herein shall be
assigned in writing to the Indonesian company which the Lessee
incorporates to operate the factory in the Lease Premises forthwith upon
the Indonesian company's Deed of Establishment being approved by the
Ministry of Justice of Indonesia. The form of the written assignment shall
be prescribed by BIC.
(Initials)
9
<PAGE> 37
ARTICLE 14
FORCE MAJEURE
Neither party shall be liable for any delay or default in the performance of its
obligations under this Lease Agreement caused by circumstances beyond the
control and without the fault or negligence of such party, including but not
restricted to acts of God, act of the public enemy, perils of navigation, fire,
hostilities, war (declared or undeclared), blockade, labour disturbances,
strikes, riots, insurrections, civil commotion, earthquakes, accidents or other
cause(s) beyond the party's control. In any of the events mentioned above, the
parties shall, for the duration of such event, be relieved of any such
obligation under this Lease Agreement as is affected by said event.
PROVIDED THAT where the duration is more than thirty (30) days the party
entitled to the benefit of the obligation to be performed is entitled to
immediately terminate this Lease Agreement by notice in writing to the other
party.
AND PROVIDED THAT the provisions of this Lease Agreement shall remain in force
with regard to all other obligations under this Lease Agreement which are not
affected by such event.
AND PROVIDED FURTHER THAT all parties shall resume their full obligations under
this Lease Agreement upon the cessation of such event.
ARTICLE 15
MISCELLANEOUS
15.1 This Lease Agreement shall remain binding on the heirs and/or successors
in title and/or assignees of the parties hereto.
15.2 Unless otherwise provided in this Lease Agreement, this Lease Agreement
sets forth the entire understanding and agreement between the parties with
respect to the subject matter hereof and supersedes and cancels any and
all prior or contemporaneous oral or written agreements or
representations, if any, between the parties.
15.3 This Lease Agreement may only be amended by a document in writing signed
by each of the parties hereto.
15.4 No waiver of any provision of this Lease Agreement nor consent to any
departure thereform by any of the parties hereto shall be effective unless
the same shall be in writing and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which it
was given. No default or delay on the part of any of the parties hereto in
exercising any rights, powers or privileges hereunder shall operate as a
waiver thereof or of any other right hereunder; nor shall a single or
partial exercise or the exercise of any other rights, power or privilege.
15.5 Clause headings are inserted for convenience of reference only and shall
be ignored in the construction or interpretation of this Lease Agreement.
(Initials)
10
<PAGE> 38
15.6 Any notice or request required or permitted to be given or made under this
Lease Agreement shall be in writing and such notice or request shall be
deemed to have been duly given or made when it is delivered by hand, mail,
courier, telex or facsimile to the party to which it is required or
permitted to be given or made at such party's address as specified below
or at such address as such party shall have designated by notice in
writing to the other party giving such notice or making such request.
BIC : Wisma Batamindo, J1. Rasamala No.1
Mukakuning, Batam 29433
Indonesia
Lessee : Lot 308, Jalan Angsana
Batamindo Industrial Park
Mukakuning, Batam, Indonesia
ARTICLE 16
GOVERNING LAW AND DISPUTE SETTLEMENT
16.1 This Lease Agreement shall be governed by and construed in accordance with
the laws of the Republic of Indonesia.
16.2 This Lease Agreement and any right or obligation granted or to be
performed herein is subject:-
(a) to the prevailing laws and regulations including but not limited to
the regulations of the Batam Industrial Development Authority; and
(b) rules and regulations formulated by BIC from time to time in
relation to the operation of BIP of which have been approved by
Batam Industrial Development Authority (hereinafter called the
"Industrial Estate Regulations") and the Lessee shall observe such
regulations.
16.3 In the event that any Article or part of an Article in this Lease
Agreement shall, for any reason, be determined by a court or arbitral
tribunal to be invalid or unenforceable then:-
(a) the remaining Articles or part Article shall not be affected,
impaired or invalidated, shall remain in full force and effect and
shall continue to be binding upon the parties; and
(b) so far as possible, the said Article or part Article shall be deemed
to be modified to the last degree possible so as to comply with the
applicable law or regulation and be valid and enforceable.
(Initials)
11
<PAGE> 39
16.4 Any dispute arising from this Lease Agreement shall be settled amicably.
Failing such amicable settlement, the parties shall refer the case to the
District Court of South Jakarta in Jakarta.
16.5 For the purpose of Article 16.4 above, both parties elect the fixed legal
domicile at the Registrar office of the District Court of South Jakarta in
Jakarta (Panitera Pengadilan Negeri Jakarta Selatan di Jakarta).
12
<PAGE> 40
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
by their respective authorised representatives the date and year first above
written.
Signed for and on behalf of )
P.T. BATAMINDO INVESTMENT ) /s/ Goh Song How
CORPORATION ) -------------------------------------
Name : GOH SONG HOW
Designation : Vice President Director
AND
/s/ Kuky Permana
-------------------------------------
Name : KUKY PERMANA
Designation : Director
Signed for and on behalf of )
DYNACS DIGITAL )
STUDIOS PTE LTD ) /s/ Venugopal Ramesh
in the presence of: ) -------------------------------------
Name : VENUGOPAL RAMESH
Designation : Managing Director
/s/ Ng Soi Hong
- -----------------------------
Name: NG SOI HONG
Designation: Finance Manager
13
<PAGE> 41
SCHEDULE 1
LEASE PREMISES
PAGE ONE OF TWO
[GRAPHIC OMITTED]
(Initials)
<PAGE> 42
SCHEDULE 1
LEASE PREMISES
PAGE TWO OF TWO
[GRAPHIC OMITTED]
(Initials)
<PAGE> 43
SCHEDULE 2
SERVICE CHARGE
Service Charges are levied for the maintenance of common properties and the
infrastructure of the industrial park such as driveway, drain, street lighting
and the turfed areas. However, the Lessee is to maintain and upkeep the Premises
in accordance with this Agreement. Disposal of refuse and industrial waste shall
not be included in the maintenance services to be rendered
(Initials)
<PAGE> 44
--------
ORIGINAL
--------
TO: JAVIER BENAVENTE
VALUE IN S$
11 PAGES ONLY.
FROM: V RAMESH
---------------------------------------------------
FIRE
INSURANCE
POLICY Nr. 02-19-20000868/00
---------------------------------------------------
-------------------------------
PT. ASURANSI WAHANA TATA
BATAM BRANCH
-------------------------------
<PAGE> 45
KANTOR PUSAT:(ILLEGIBLE) ASURANSI WAHANA TATA
(ILLEGIBLE) H.R. Said Key, 0C - 4 Jakarta 12920
[ILLEGIBLE]
TLX. 62304 WATANO IA FAX (021)-5203149, (ILLEGIBLE)
- --------------------------------------------------------------------------------
INDONESIAN STANDARD FIRE POLICY
IN CONSIDERATION of the payment of the Premium and on the basis of written
declarations given by the Insured which constitute an inseparable part of this
Policy the undersigned insures property and/or interests specified below against
loss caused by perils described herein subject to the Conditions and
stipulations printed on, attached to or written in this Policy.
THE SCHEDULE
- --------------------------------------------------------------------------------
Policy No. : 02-19-20000(ILLEGIBLE)/00
(new)*
Named of the Insured : Pt. DYNACS DIGITAL STUDIOS
JL Angsana Lot 308 Batamindo Industrial
Park
Address : MUKA Kuming-batam
- --------------------------------------------------------------------------------
Insurance Period : 12 ( --- Twelve --- ) months,
Commencing : 29th May 1999 until 29th May 2000 12 O'clock noon
local time at the location of the insured object.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Lighting : electric Fire Premium : SGD 578.00
Construction Class : 1st class Additional Premium : SGD 633.40
Type of Risk/Occupancy : Laboratories Photographic Additional Premium :
Code No. : 2924 Additional Premium :
Premium Rate : 0.580000 % 0 (per mil)p.o .................. :
Policy Expenses : SGD 2.86
------------------
: SGD 1,213.11
Additional Coverage : Riot, Strike & Malicious
Damage Sales Tax :
Code No. : 4.1A Stamp Duty : SGD 2.44
------------------
Premium Rates : 0.615000 % 0 (per mile)p.o Total : SGD 1,215.55
==================
(IN WORDS : One thousand two hundred thirteen Dollars and Fifty-five cent.
..............................................................)
</TABLE>
- --------------------------------------------------------------------------------
-- Theft during fire exclusion clause; -
Electrical short circuit clause (compulsory)
Attachment/Additional clauses -- Reinstatement additional premium
clause-compulsory; - Addendum PSKI.
-- Payment of premium warranty; - Electronics
Data Recognition Exclusion.
- --------------------------------------------------------------------------------
No.: Specification of insured items : Sum Insured:
A. On Building Laboratories Photographic (as per
attached list) 1st Class construction located
at Jaian Angsana Lot 308. Batamindo Industrial
Park, Muka Kuning Batam 29433.- SGD 179,000.00
B. On Furnitures (as per attached list) SGD 80,000.00
C. On Office Equipments (as per attached list) SGD 7,000.00
D. On Machineries (as per attached list) SGD 754,000.00
Items B, C & D which are inside in the above building,
--------------------
Total = SGD 1,030,000.00
====================
- --------------------------------------------------------------------------------
Attached
- Endorsement Code: 4.1A Date: Batam, 1st May 1999
-----------------------------
Signature of the Insured
PT. ASURANSI WAHANA TATA
/s/ [ILLEGIBLE]
[ILLEGIBLE]
- --------------------------------------------------------------------------------
<PAGE> 46
-2-
PERILS INSURED
This Policy covers loss of or damage to the insured property and/or interests
caused by:
1. FIRE,
Including fire as a consequence of self-combustion, negligence,
wrongdoings or crime committed by own servant, neighbour enemy, robber,
and others whomsoever, or other unknown causes of fire; including:
the consequences of fire to other nearby objects, such as loss of or
damage to insured property and/or interests, caused by water or other
instruments used to fight or extinguish the fire, also loss or damage as a
consequence of destruction ordered by lawful authorities to prevent
further spreading of the fire.
2. LIGHTNING,
3. EXPLOSION,
(1) The Policy covers losses due to explosion of all kinds except those
by nuclear energy.
(2) Explosion is any sudden release of energy resulting from the
expansion of gases or vapours. The bursting of a container (boiler,
pipe, etc.) is only regarded as an explosion if the walls of the
container are torn open to such an extent that a sudden equalization
of the pressures inside and outside takes place. If an explosion
occurs inside a container due to chemical reaction, any damage to
the container is indemnifiable even if the walls of the container
are not torn open. Losses caused by low pressure are not covered by
the policy.
(3) Losses to combustion engines resulting from the explosion taking
place within the combustion chambers or to switching members in
electrical switches by the gas pressure arising within them are
excluded from the cover.
4. IMPACT OF FALLING AIRCRAFT
Loss by aircraft shall include direct loss resulting from actual physical
contact of an aircraft with property covered hereunder or with the
building containing the property covered hereunder, and direct loss by
objects falling therefrom.
PERILS NOT INSURED
This Insurance does not cover loss of or damage to the insured property and/or
interests caused by:
1. Fire or Explosion resulting from its own inherent vice, process of decay,
or the condition and nature of the goods.
2. War, invasion, act of foreign enemy, hostilities or warlike operations
(whether war be declared or not), civil war, mutiny, civil commotion
assuming the proportions of or amounting to a popular rising,
insurrection, rebellion, revolution, military or usurped power, or any
act of any person acting on behalf of or in connection with any
organization with activities directed towards the overthrow by force of
the government de jure or de facto or to the influencing of it by
terrorism or violence; including any consequences thereof that occur
either directly or indirectly.
In any action suit or other proceedings, where the Company alleges that by
reason of the provisions of the Condition any loss or damage is not
covered by this Insurance, the burden of that such loss is covered shall
be upon the Insured.
3. Riot, strike, malicious actions, impact by vehicle, smoke, earthquake,
volcanic erruption, flood, inundation, windstorm, tempest, water damage,
removal of debris, loss of profit as a consequence of fire; except where
specifically insured.
4. Nuclear reactions, nuclear radiation or pollution by radio activity,
regardless of whether such processes occur inside or outside the premises.
Unless otherwise expressly stated in this Policy, this Insurance does not cover:
- - goods held in trust or on commission
- - bullion or unset precious stones
- - any curiosity or work of art for an amount exceeding Rp. 500,000
- - manuscripts, plans, drawings or designs, patterns, models or moulds
- - securities, obligation or documents of any kinds, stamps, coined or paper
money, cheques, books of accounts or other business books, and computer
systems records
<PAGE> 47
-3-
POLICY CONDITIONS
I. PAYMENT OF PREMIUMS
1. Notwithstanding the provisions of Article ILLEGIBLE of the
Commercial Code (Kitab ILLEGIBLE) this Insuance and any renewal
thereof shall come into force on the commencing date stipulated in
the Schedule or any anniversary thereof provided the Premium is paid
within fourteen (14) days of such date.
2. If the Premium is not paid within fourteen (14) days of the date of
commencement of renewal of this Policy the coverage will be
suspended and the Insured shall lose all rights to any indemnity as
from the date of commencement or renewal as stated in this Policy
and or attachment thereto.
The Insurance shall be reinstated twenty four (24) hours after the
payment of the Premium and the Insured shall not be entiled to any
refund of Premium or any extension of the period of coverage in
consequence of the period of such suspension. The Insurer is not
obliged to give any notice of suspension of cover under the terms of
this Condition.
II. OTHER INSURANCE
1. Prior to the Attachment of this Insurance the Insured shall give
notice to the Insurer of any Insurance or Insurances already
effected on the property and/or interests.
2. If subsequent to the attachment of this insurance other insurance is
effected on the same property and/or interests the Insured is
obliged to make this disclosure thereof to the insurer.
III. ALTERATION TO RISK
1. If changes or alterations are made to the insured buildings or to
the premise where the insured goods are stored, or if part of the
premises of the entire premises are used for other purposes, or if
other goods are stored at the premises which increases the risk of
fire or explosion and the Insured knows or should have known about
this, then the Insured is obliged to immediately notify the Insurer.
2. Upon the receipt of such notification the Insurer shall have the
right to determine whether or not the Policy may be continued on the
basis of the existing Premium or whether a higher Premium should be
charged or whether the Policy should be terminated. In the event of
such termination the Insured shall be entitled to receive a refund
of Premium for the unexpired period of insurance.
IV. REMOVALS AND CHANGE OF OWNERSHIP
1. This insurance shall (ILLEGIBLE) to attach to any items which have
been removed to premises other than those mentioned in the Policy
unless the Insurer has agreed to such removal by written endorsement
in the Policy.
2. Notwithstanding the provisions of Article 202 of the Commercial Code
(Kitab Undang-Undang Hukum (ILLEGIBLE) when there is a change of
ownership of the insured property and/or interests, whether on the
basis of agreement or due to the death of the Insured, this
Insurance shall automatically become void ten (10) days after such
change of ownership unless the Insured has agreed in writing to
continue the insurance.
V. OBLIGATIONS OF THE INSURED IN THE EVENT OF LOSS OR DAMAGE.
1. The insured, upon knowledge or when it could be regarded that he
should have known about the occurence or loss or damage to property
or interest insured by this Policy must
(a) immediately inform the Insurer
(b) within seven (7) days give a written report containing all
known facts concerning the loss or damage including
information as to the cause or causes of the damage or loss to
the best of his knowledge or assumption. Such report should
contain as (INLEGIBLE) an account as may be reasonably
practicable of all the several articles or items of property
lost, damaged or destroyed as well as an account of all
insured property which is not affected by such loss or damage.
2. At the time of the loss of damage the Insured is obliged:
(a) to the best of his ability, safeguard the insured property and
authoritize other people to assist and safeguard the property.
(b) to provide full support to the insurer or his representatives
or any other party appointed by the Insurer to conduct an
investigation of the loss or damage.
(c) to safeguard all salvageable property.
All rights to indemnification under this Policy shall be forfeited
if the Insured fails to comply with the above requirements.
VI. LOSS REPORTING
When filing a claim under this Policy the Insured must:
(a) submit the Policy together with an official report of the incident
from the (ILLEGIBLE) the local police and/or other competent
authority.
(b) deliver a detailed report explaining as completely as possible the
circumstances that according to his knowledge have caused the loss
or damage.
(c) supply any other information and evidence as requested by the
Insurer.
VII. INDEMNITY
1. In the event of loss or damage to the insured property and/or
interests the maximum liability of the Insurer shall be limited to
the (ILLEGIBLE) insured specified in the Schedule.
2. The basis of the calculation of the Indemnity shall be a comparison
of the value prior to the loss or damage and the value of any
(ILLEGIBLE) immediately after the loss.
VIII. LOSS OF OR DAMAGE TO MOVABLE ITEMS
In the event of loss or damage to movable items, the Insured is obliged
within fourteen (14) days to:
1. (a)- For Furniture and/or Household Goods: prepare and submit
a list containing the type of each item and estimated
values immediately prior to the loss or damage as well as a
list containing the salvage values of the items.
(b)- For Raw Materials and Merchandise:
prepare and submit a list containing estimated values of each
and every item immediately prior to the loss or damage as well
as a list containing the salvage values.
(c)- submit books and relevant documents as may be requested by the
Insurer or if not available, invoices, notes, or any document
that can be used as proof of the loss or damage.
2. (a)- If the insured object is described by the general terms of
"furniture and household goods, machinery", or "goods, wares
and merchandise", such furniture and household goods,
machinery or goods, wares and merchandise which are at the
time of the fire at the place mentioned in the Policy will be
covered by the Insurance, whether they were there at the time
the Insurances was affected or not.
(b)- If the kind of each of the insured items is specified, the
previous paragraph will only be valid when those items
are present at the premises at the moment of the loss of
damages.
(c)- The preceding provisions shall not apply to objects which
owing to in their description in the Policy or the
valuation in the Policy are to be considered as irreplaceable.
IX. INDEMNIFICATION OF MULTIPLE INSURANCE - CONTRIBUTION
1. Notwithstanding anything to the contrary in the provisions of
Article 277 page 1 of the Commercial Code (ILLEGIBLE) in the event
of loss of or damage to property or interest insured by this Policy
where such property or interest to be insured by any other Policy or
Polices and the total Sum Insured under all Policies exceeds the
actual value of the property or interest the Sum Insured under
this Policy will be reduced in proportion to the total Sum Insured
against the actual value of the property or interest of the Insured
shall not be entitled to a reduction or refund of premium.
2. Nothwithstanding anything to the contrary contained in paragraph 1
above the provisions of Article 377 of the Commercial Code
(ILLEGIBLE) shall apply in the event that any or all of the other
insurances precede the effective date of this Policy and do not
contain a similar contribution clause.
3. In the event of loss or damage the Insured is obliged at the request
of the Insurer to submit a written declaration of any other
insurance covering the same property or insured.
<PAGE> 48
-4-
X. UNDER INSURANCE
If the property or interest hereby insured shall, at the time of loss or
damage be collectively of greater value than the Sum Insured thereon then
the Insured shall be considered as being his own insurer for the
difference and shall bear a rateable proportion of the loss
accordingly. Every item, if more than one, of the Policy shall be
separately subject to this condition.
XI. FRAUDULENT REPORTS
If the Insured deliberately increases the amount of loss allegedly
suffered or includes items that did not exist at the time of loss or
damage or retains items or part of the salvable items and reports that
those items had been destroyed, or uses false documents/evidence or makes
fraudulent statements to support his claim for the loss suffered or by
serious mistake or negligence beyond reason burns/explodes/destroys or
give orders to burn/explode or destroy or causes fire/explosion
/destruction, he shall lose the right for indemnification.
VII. ASSESSMENT OF ESTIMATED VALUE IN THE EVENT OF A CLAIM
1. The estimated value shall be based on the real value of the property
without adding any profit.
2. In the assessment of the value of buildings no account shall be
taken of their location or occupation.
3. Unless specifically mentioned foundations and underground
construction shall not be included in the value assessment.
4. The amount of loss as mentioned above shall be estimated on the
basis of assessment made by one or more assessors approved by both
parties, and result of the assessment shall be binding on both
parties, unless one of the parties can prove that the assessment is
based on false information or wrong calculation in which case the
Insurer or the Insured is entitled to request an investigation.
5. Goods, materials and merchandise will be assessed on the basis of
their cost price immediately prior to the occurrence of the loss or
damage.
XIII. REIMBURSEMENTS
a. In the case of loss, service fees and honoraria for the assessors
and other experts who are appointed on the basis of agreement
between the Insurer and the Insured, will be paid by the Insurer.
b. Reasonable expenses incurred to prevent or reduce losses (whether
successful or not) disbursed by the Insured in accordance with
Condition V paragraph 2 and Condition XIV paragraph 2, shall be
reimbursed by the Insured.
XIV. SALVAGE
In the event of loss or damage:
1. the salvage, if any, is the responsibility of the Insured
2. The Insurer is entitled to request the Insured to store all or part
of the salvage.
3. It is stipulated that any action on the part of the Insurer
including a request to store the salvage as mentioned above, can by
no means be considered as an acknowledgement of any responsibility
whatsoever.
XV. INDEMNIFICATION
The Insurer is obligated to pay in full the indemnity within six (6) weeks
after an agreement on the amount of the indemnity has been reached.
XV1. SUBROGATION
1. In accordance with Article 284 of the Commercial Code ( ILLEGIBLE),
upon payment of indemnity on the property and/or interests insured
by this Policy, the insurer will replace the Insured as regards any
rights that he has against a third party concerning the loss.
Subrogation as mentioned in the above paragraph will be
automatically valid without any letter of authorization from the
Insured.
2. The Insured remains responsible for any action that could possibly
affect the rights of the Insurer against a third party.
XV11. REINSTATEMENT OF THE SUM INSURED
Upon payment of indemnity in the event of loss of or damage to the insured
property and/or interests, the amount of the indemnity will be deducted
from the Sum Insured.
After restoration of the damage the Insured can request reinstatement of
the Sum Insured by paying additional premiums.
XVIII. FORFEITURE OF RIGHT TO INDEMNIFICATION
The right of the Insured to indemnification for loss or damage will be
automatically forfeited if no claim has been submitted within twelve (12)
months of the occurrence of loss or damage.
XIX. TERMINATION OF THE INSURANCE
1. Both the Insurer and the Insured are entitled to terminate this
insurance at any time without giving reason therefor. Such
termination shall be effected by registered letter. The insurer is
relieved from all liability under this Policy twenty four (24) hours
after the date of dispatch of the registered letter.
2. When the Insurer terminates the insurance, he is obliged to return
pro rata premium for the unexpired period of Insurance. If it is
the Insured who terminates the insurance, premium will be calculated
on the short term rate laid down in the current Fire Insurance
Tariff of Indonesia for the completed period of Insurance.
XX. RETURN PREMIUM
The Insured shall have no right to any return of Premium except as
described in Conditions III, IV and XIX.
XXI. DISPUTES
1. Any condition or provision contained in this Policy notwithstanding,
it is understood and agreed that all disputes resulting from the
performance and/or interpretation of this agreement of insurance are
to be submitted to three Arbitrators whose award shall be final and
binding.
2. The party desiring to submit a case to arbitration must give the
other party notice of his intention in writing. The three
Arbitrators shall be appointed by both parties by mutual agreement.
If within four weeks from the date of such written notice the
parties are unable to agree on the selection of the Arbitrators, the
most ready party may request the Chairman or in his absence the
acting Chairman of the Association of Insurance Companies in
Indonesia to nominate the Authority which is to appoint the
Arbitrators.
3. The Arbitrators are bound to pronounce on the issues before them in
a just and equitable manner.
4. The Arbitrators shall determine the Rules of the Arbitral
Proceedings.
5. In their final Award the Arbitrators shall decide by
which party or parties the costs of the Arbitral Proceedings
including the disbursements and the fees of the Arbitrators and the
fees and disbursements of the lawyers representing the parties,
shall be wholly or partially borne.
6. The Arbitrators shall take the necessary measures in order that the
original of the Award shall be filed at the Local Court of
competent jurisdiction, in which city the Award(s) shall be made.
7. The powers to be granted of the Arbitrators shall continue until
after the filing referred to is the above-mentioned stipulation 6.
XXII. CONCLUSION
Matters which may not be sufficiently provided for in this Policy shall be
subject to the provisions of the Commercial Code (Kitsh Undang - Undang
Mukum Dagang).
<PAGE> 49
-5-
This Endorsement is attached to and forms an integral part of:
Policy Number : 02-19-20000868/00
Insured's Name : PT. DYNACS DIGITAL STUDIOS
It is hereby agreed and declared that:
a) Notwithstanding anything contained in Chapter 11-Exceptions. Item 1.3.1.
of this Policy to the contrary and subject to payment of additional
premium, the insurer agrees to extend this insurance as provided in this
Endorsement:
b) Notwithstanding anything which may be defined in any laws or regulations
to the contrary, for the purpose of this Endorsement, all terminology
printed in italics shall be deemed to mean as defined in CHAPTER III -
DEFINITIONS of the Policy.
1. EXTENSIONS
This insurance is extended to cover:
- Physical damage to the property and/or interest insured directly
caused by one or more of the following perils:
1.1. Riots
1.2 Strikes
1.3. Locked-out Workers
1.4 Malicious Acts
1.5 Preventive Acts
- Physical loss of the property and/or interest insured directly
caused by:
1.6 Looting occurring during RIOTS
Provided that any of these perils does not develop in an uninterrupted
chain of events into one or more of the excluded perils.
2. EXCLUSIONS
This extension does not cover all physical loss of or damage to the
property and/or interest insured including loss or damage by fire directly
or indirectly caused by or contributed to by or arising from or in
consequence of one or more of the following perils:
2.1 CMI Commotions, Insurrection/Popular Rising, Usurped Power,
Revolution, Rebellion, Military Power, invasion, Civil War and
Hostilities, Subversive Acts, Terrorism, Sabotage or Looting
(except Looting occurring during Riots).
In any action, suit or other proceedings, where the insurer alleges
that loss or damage is directly or indirectly caused by one or more
of the excluded perils under this Section, the burden of proof that
such loss or damage is covered shall be on the insured.
2.2 Total or Partial cessation of works, or retarding or interruption or
cessation of any process or operation.
2.3 Permanent or temporary dispossession resulting from confiscation,
commandeering or requisition by any lawfully constituted authority
or body, or unlawful occupation by any person.
2.4 Business interruption, or any kind of consequential loss.
3. DEDUCTIBLES
The Insured shall bear 15% (fifteen per cent) of the adjusted loss subject
to minimum of Rp. 10,000,000 -- (ten million Rupiah) for each claim
payable under this Endorsement.
4. MEMORANDUM
For the purpose of this Endorsement Item 18 CHAPTER III - DEFINITIONS of
this Policy is deleted and replaced with the following:
18. Looting is the appropriation of property belonging to another by any
person (excluding those employed by or under the control of the
insured), with the intention of permanently depriving that other of
it.
All other terms and conditions of the Policy remain unchanged.
(This wording is a translation of the original version in Bahass Indonesia; in
the event of any dispute arising from the interpretation of any meaning herein,
the Terms and Conditions shall be interpreted according to the original Bahass
Indonesia version).
/s/ [ILLEGIBLE]
<PAGE> 50
[LOGO] ASURANSI WAHANA TATA
--------
ORIGINAL
--------
----------------------------------
BURGLARY
INSURANCE
POLICY NR. 04-19-20000009/00
----------------------------------
----------
PT. ASURANSI WAHANA TATA
BATAM BRANCH
----------
<PAGE> 51
[LOGO] ASURANSI WAHANA TATA Original
---------------------------
BURGLARY INSURANCE
Policy Nr : 04-19-20000009/00
Assured (s) : PT. DYNACS DIGITAL STUDIOS
Address : Jalan Angsana Lot. 308, Batamindo Industrial Park
Muka Kuning - Batam
Period of Insurance : 12 (twelve) months
Commencing : 29th May 1999 until 29th May 2000
12:00 o'clock Noon local time at the
location of the Insured object.
Property Insured : 1. Office Equipments SGD. 7,000.00
2. Machineries SGD. 643,000.00
Location of Risk : Jalan Angsana Lot. 308, Batamindo Industrial Park
Muka Kuning-Batam
Total Sum Insured : SGD 650,000.00
Premium Calculation:
SGD.650,000.00 x 1.00% = SGD. 6,500.00
Administration Cost... = SGD. 2.86
Stamp duty..............= SGD. 0.44
-------------
SGD. 6,503.30
-------------
Batam, 31st May 1999
Signature of the Insurer
PT. ASURANSI WAHANA TATA
/s/ [ILLEGIBLE]
<PAGE> 52
[LOGO] ASURANSI WAHANA TATA Original
---------------------------
THE DESCRIPTION OF OFFICE EQUIPMENTS AND MACHINERIES
ATTACHING TO AND FORMING PARTS OF
BURGLARY INSURANCE POLICY NO. 04-19-200000000/00
A. OFFICE EQUIPMENTS )
- Office Table )
- Office Chair )
- Filing Cabinet )
- Cupboard )
- Photo Copy Machine ) B.S. 7,000
- Fax Machine )
- Safe )
- Sanyo Fridge )
- HP Printer Laser Jet 1100 )
- Decoration Painting )
B. MACHINERIES
- Ranger Computer 101 Nos )
- DDR (Server) 4 Nos )
- 19' Sony Color Monitor 134 Nos )
- 20' High Resolution Monitor 3 Nos )
- Key Board and Mouse 156 Nos ) S.S. 643,000
- Philip 20' Color TV 1 Nos )
- Philip VCR 1 Nos )
- Compressor )
Batam, 31 May 1999
P.T. ASURANSI WAHANA TATA
/s/ [ILLEGIBLE]
<PAGE> 53
[LOGO] ASURANSI WAHANA TATA
- ---------------------------
BURGLARY
WHEREAS, the Insured has made to the Insurer named in the schedule (hereinafter
called the "Company") a Proposal and Declaration or furnished certain
information which shall be the basis of this contract and which is deemed to be
incorporated herein and has paid or agreed to pay the Premium stated in the
aforesaid schedule as consideration for the Indemnity hereinafter contained.
NOW THIS POLICY (INLEGIBLE) that if at any time during the Period of Insurance
stated in the schedule hereto or during any further period for which the Company
may accept payment for the renewal or extension of this Policy.
A. The property or any part, thereof within the Premises shall be stolen or
damaged by any person not being an employee of the Insured who:
I. Breaks and enters the premises while they are securely locked or,
II. Breaks out of the premises, while they have been securely locked,
after having committed a crime therein or,
III. At the Premises commits theft accompanied by violence or threat of
violence to any person on the premises where such violence or threat
is used to extort the property stolen or to prevent or overcome
resistance to its being stolen or
B. There shall arise any damage to the premises falling to be borne by the
Insured due to the action of such persons as aforesaid or any attempt
thereat.
Then the Company will subject to the Terms, Exceptions, Limits and Conditions
contained herein or endorsed hereon, indemnify the Insured against
a) Such loss to the extent of market value at time of the loss (not including
profit of any kind ) and/or
b) The net cost of repairing such damage.
but not exceeding in respect of any one item specified in the schedule the Sum
Insured thereon nor in the whole during any one period of Insurance such total
Sum Insured.
PROVIDED ALSO that the Premises mentioned in the schedule shall not include any
yard, garden, outbuilding, or other appurtenances unless specifically included
in the schedule hereto.
EXCEPTIONS
The Company shall not be liable in respect of :
(a) Loss or damage due to any attempt thereat by or in collision with any
members of the Insured's start or family or tenant or any person lawfully
on the Premises.
(b) Damage to glass or any decoration or lattering or alarm tapes thereon.
(c) Loss or Damage occasioned by fire or explosion.
(d) Loss of damage to medals, coins, curiosities, sculptures, manuscripts,
rate books, plans, patents, models, moulds, designs, deeds, bonds, bills
of exchange, promissory notes, money, securities for money, stamps,
documents of title or business books unless specifically included in the
schedule.
(e) Loss or damage directly or indirectly caused by war, invasion, act of
foreign enemy, hostilities (whether to be declared or not), civil war,
rebellion, revolution, insurrection, riot, strikes, civil commotion,
military or usurped power, or confiscation or destruction by order of any
Government or Public Authority and in the event of any claim hereunder the
Insured shall prove that the claim arose independently of and was in no
way connected with or occasioned by or contributed to by or traceable to
any of the aforesaid occurrences or any consequence thereof and in default
of such proof the Company shall not be liable to make any payment in
respect of such a claim.
(f) Loss or damage to any property whatsoever or any loss of expense
whatsoever resulting from or arising therefrom or any consequential loss
or any liability of whatsoever nature:
(i) Directly or Indirectly caused by or contributed to by or arising
from (ILLEGIBLE) radiations or contamination by radio activity from
any nuclear fuel or from any nuclear waste from the combustion of
nuclear fuel. For the purpose of the exception combustion shall
include any self-sustaining process of nuclear fission.
(ii) Directly or Indirectly caused by or contributed to by or arising
from nuclear weapons material.
(g) Loss or damage arising whilst the premises are unoccupied for a period
exceeding 30 consecutive days or are occupied otherwise than as stated in
the schedule unless the written consent of the Company shall have
previously been obtained and any additional premium required by the
Company has been paid.
/s/ [ILLEGIBLE]
<PAGE> 54
[LOGO] ASURANSI WAHANA TATA
- ---------------------------
CONDITIONS
1. Immediately upon the happening of any event giving rise or likely to give
rise to claim under this Policy, the insured shall:
(a) Give notice to the Police and render all reasonable assistance in
causing the discovery and punishment of any guilty person or persons
and in trading and recovering the property.
(b) Give notice thereof to the Company in writing and within 14 days
thereafter deliver to the Company a claim in writing and apply all
such detailed particulars, proofs and evidence in support of such a
claim as may be reasonably required by the Company.
In no case shall the Company be liable for any loss not notified to the Company
within 14 days after the event.
2. The Insured shall take all reasonable precautions for the safety of the
property insured as regards selection and supervision of employees
securing all doors and windows and other means of entrance or otherwise.
3. The Company may at any time at its own expense use all legal means in the
name of the Insured for the recovery of the property lost or its value and
the Insured shall give all reasonable assistance for that purpose the
Company shall be entitled to any property for the loss of which a claim is
paid hereunder and the Insured shall execute all such assignments of such
property as may be reasonably required. The Insured shall not be entitled
to abandon any property to the Company.
4. All notice required to be given by the Insured to the Company must be in
writing addressed to the Company and no alteration in the terms of this
Policy nor any endorsement thereon will be held valid unless the same is
signed or initialed by an authorized representative of the Company.
5. If the Property Insured shall at the time of any event giving rise to a
claim under this Policy be collectively of a greater value than the Sum
Insured thereon, then the Insured shall be considered as being his own
Insurer for the difference and shall bear a rateable proportion of the
loss accordingly. Each item in the schedule hereto shall be separately
subject to this condition.
6. This Policy may be cancelled by the Insured at any time by notice in
writing delivered to the Company in which case the Company shall retain or
be entitled to recover as the case may be, the customary short term
premium or minimum premium for the time during which the Policy has been
in force the Company may at any time by giving written notice to the
Insured cancel this Policy. Notice of cancellation may be delivered
personally or posted by registered letter to the Insured at his or its
address last known to the Company and the cancellation of the Policy shall
be effective as on the seven day after posting of personal delivery by the
Company. After cancellation by the Company as aforesaid the Company will
on application by the insured refund the amount of unearned premium on a
pro-rata basis subject to any adjustment of premium as may be required by
the terms or conditions of this Policy.
7. If the proposal or declaration of the Insured is untrue in any respect or
if any material fact reflecting the risk be incorrectly stated therein or
omitted therefrom or if this Insurance or any renewal thereof shall have
been obtained through any mis-statement, misrepresentation or suppression
or if any claim made shall be fraudulent or exaggerated or if any false
declaration shall be made in support thereof then, in any of these cases,
this Policy shall be void.
8. If at the time of the happening of any loss or damage covered by this
Policy there shall be subsisting any other Insurance of any nature
whatsoever covering the Property insured or any part thereof, whether
effected by the Insured or not, then the Company shall not be liable to
pay or contribute more than its rateable portion of any loss or damage.
Each item of this Policy shall be separately subject to this condition.
9. Nothing contained herein shall give any rights against the Company to any
person other than the Insured, and the Company will not be bound by any
passing of the interest of the Insured otherwise than by death, unless and
until the Company shall by endorsement hereon declare the Insured to be
continued.
10. If any difference shall arise as to the amount to be paid under this
policy (Liability being otherwise admitted) such difference shall be
referred to an arbitrator to the appointed in accordance with the
statutory provisions in that behalf for the time being in force. Where any
difference is by this condition to be referred to arbitration the making
of an award shall be a condition precedent to any right of action against
the Company, unless any such action or suit be commenced within six months
of the making of an award the Company shall not be liable to make any
payment in excess of the amount of the award.
11. In no case whatever shall the Company be liable for any loss or damage
after the expiration of twelve months from the happening of the loss or
damage unless the claim is the subject of pending action or arbitration.
12. The due observance and fulfillment of the terms conditions and endorsement
of this Policy insofar as they relate to anything to be done or complied
with by the Insured and truth of the statements and answers in the said
proposal shall be conditions precedent to any liability of the Company
make any payment under this Policy.
/s/ [ILLEGIBLE]
<PAGE> 1
Exhibit 10.21
PROMISSORY NOTE
Date Of Note: October 6, 1997 Amount: $200,000.00
Dynacs Engineering Company, Inc., promises to pay Venugopal Srinivasan and
Ranjini Srinivasan -- joint tenants with right of survivorship - $200,000.00
together with interest at the annual rate of 10.5% in 36 monthly installments of
$6,500.49 each due on the sixth (6th) day of each month beginning November 6,
1997.
/s/ Ramendra P. Singh
- ---------------------
Ramendra P. Singh
President
<PAGE> 2
Mortgage Amortization Table as of 06/23/98
Principal is $200000.00 at 10.50 % for 3.00 years.
Monthly Payments of $ 6500.49
<TABLE>
<CAPTION>
* Indicates Balloon Payment made
No Month Year Interest Principal Balance Accum Interest
<S> <C> <C> <C> <C> <C> <C>
1 Nov 1997 1750.00 4750.49 195249.51 1750.00
2 Dec 1997 1708.43 4792.06 190457.45 3458.43
Annual Recapitulation For Year: 1997
Interest Paid This Year 3458.43 Principal Reduction 9542.55
Loan Balance 190457.45
<CAPTION>
* Indicates Balloon Payment made
No Month Year Interest Principal Balance Accum Interest
<S> <C> <C> <C> <C> <C> <C>
3 Jan 1998 1666.50 4833.99 185623.47 5124.94
4 Feb 1998 1624.21 4876.28 180747.18 6749.14
5 Mar 1998 1581.54 4918.95 175828.23 8330.68
6 Apr 1998 1538.50 4961.99 170866.24 9869.18
7 May 1998 1495.08 5005.41 165860.83 11364.26
8 Jun 1998 1451.28 5049.21 160811.62 12815.54
9 Jul 1998 1407.10 5093.39 155718.23 14222.64
10 Aug 1998 1362.53 5137.96 150580.27 15585.17
11 Sep 1998 1317.58 5182.91 145397.36 16902.75
12 Oct 1998 1272.23 5228.26 140169.10 18174.98
13 Nov 1998 1226.48 5274.01 134895.09 19401.46
14 Dec 1998 1180.33 5320.16 129574.93 20581.79
<CAPTION>
Annual Recapitulation For Year: 1998
Interest Paid This Year 17123.36 Principal Reduction 60882.52
Loan Balance 129574.93
* Indicates Balloon Payment made
No Month Year Interest Principal Balance Accum Interest
<S> <C> <C> <C> <C> <C> <C>
15 Jan 1999 1133.78 5366.71 124208.22 21715.57
16 Feb 1999 1086.82 5413.67 118794.55 22802.39
17 Mar 1999 1039.45 5461.04 113333.51 23841.84
18 Apr 1999 991.67 5508.82 107824.69 24833.51
19 May 1999 943.47 5557.02 102267.67 25776.98
20 Jun 1999 894.84 5605.65 96662.02 26671.82
21 Jul 1999 845.79 5654.70 91007.32 27517.61
22 Aug 1999 796.31 5704.18 85303.15 28313.93
23 Sep 1999 746.40 5754.09 79549.06 29060.33
24 Oct 1999 696.05 5804.44 73744.62 29756.38
25 Nov 1999 645.27 5855.22 67889.40 30401.65
26 Dec 1999 594.03 5906.46 61982.94 30995.68
</TABLE>
Annual Recapitulation For Year: 1999
Interest Paid This Year 10413.89 Principal Reduction 67591.99
Loan Balance 61982.94
<PAGE> 3
<TABLE>
<CAPTION>
* Indicates Balloon Payment made
No Month Year Interest Principal Balance Accum Interest
<S> <C> <C> <C> <C> <C> <C>
27 Jan 2000 542.35 5958.14 56024.80 31538.03
28 Feb 2000 490.22 6010.27 50014.53 32028.25
29 Mar 2000 437.63 6062.86 43951.67 32465.88
30 Apr 2000 384.58 6115.91 37835.75 32850.45
31 May 2000 331.06 6169.43 31666.33 33181.52
32 Jun 2000 277.08 6223.41 25442.92 33458.60
33 Jul 2000 222.63 6277.86 19165.05 33681.22
34 Aug 2000 167.69 6332.80 12832.26 33848.92
35 Sep 2000 112.28 6388.21 6444.05 33961.20
36 Oct 2000 56.39 6444.05 0.00 34017.59
</TABLE>
Last Payment will be $ 6500.44
Annual Recapitulation For Year: 2000
Interest Paid This Year 3021.90 Principal Reduction 61982.94
Loan Balance 0.00
<PAGE> 1
Exhibit 10.22
[Letterhead of Dynacs Engineering Co. Inc.]
PROMISSORY NOTE
$110,000 February 15, 1997
FOR VALUE RECEIVED, the undersigned, a Florida Corporation, promises to pay to
the order of VENUGOPAL SRINIVASAN at 1528 Colony Ct., Palm Harbor, Florida, or
at such other place as the Payee hereof may, from time to time, designate in
writing, the principal sum of One Hundred Ten Thousand and No/100 Dollars
($110,000.00), with simple interest from the date hereof at the rate of 1% per
month until maturity. All the principal shall be due and payable in full on
February 15, 1998. Interest at the aforementioned rate shall be applied to any
remaining unpaid principal and shall be due and payable on the 15th day of each
month until maturity.
In the event of a default under this note, the undersigned shall pay all costs
and expenses of collection including reasonable attorney's fees.
This indebtedness may be prepaid in part or in full at any time with interest to
date of payment only.
This Note is not assignable by either the payee or the undersigned Maker.
This Note is to be construed and enforced according to the laws of the State of
Florida.
DYNACS ENGINEERING CO., INC.
By /s/ Ramendra P Singh
----------------------------------
Ramendra P Singh, President
<PAGE> 2
[Letterhead of Dynacs Engineering Co. Inc.]
PROMISSORY NOTE
$110,000 February 15, 1999
FOR VALUE RECEIVED, the undersigned, a Florida corporation, promises to pay to
the order of VENUGOPAL SRINIVASAN at 1528 Colony Ct., Palm Harbor, Florida, or
at such other place as the Payee hereof may, from time to time, designate in
writing, the principal sum of One Hundred Ten Thousand and No/100 Dollars
($110,000.00), with simple interest from the date hereof at the rate of 1% per
month until maturity. All the principal shall be due and payable in full on
February 15, 2000. Interest at the aforementioned rate shall be applied to any
remaining unpaid principal and shall be due and payable on the 15th day of each
month until maturity.
In the event of a default under this note, the undersigned shall pay all costs
and expenses of collection including reasonable attorney's fees.
This indebtedness may be prepaid in part or in full at any time with interest to
date of payment only.
This Note is not assignable by either the payee or the undersigned Maker.
This Note is to be construed and enforced according to the laws of the State of
Florida.
DYNACS ENGINEERING CO., INC.
By:/s/ Ramendra P. Singh
------------------------------
Ramendra P. Singh, President
<PAGE> 3
AMENDMENT TO PROMISSORY NOTE
This Amendment to Promissory Note (the "Amendment") dated August 14, 2000
by and between Dynacs Inc. (formerly known as Dynacs Engineering Co., Inc.)(the
"Company") and Venugopal Srinivasan (the "Payee").
Reference is made to that certain promissory note dated February 15, 1999
by and between the Company and Payee in the principal amount equal to $110,000
(the "Promissory Note").
The parties agree that the Maturity of the Promissory Note shall be
extended to August 15, 2000.
All other terms and conditions of the Promissory Note shall remain in full
force and effect.
DYNACS INC.
By: /s/ Ramendra P. Singh
------------------------------
Ramendra P. Singh
<PAGE> 1
Exhibit 10.23
[Letterhead of Dynacs Engineering Co. Inc.]
PROMISSORY NOTE
$160,000 Palm Harbor, Fl.
March 30, 1999
FOR VALUE RECEIVED, the undersigned, a Florida Corporation, promises to pay to
the order of Ramendra P. Singh (hereinafter referred to as the "Payee") at 118
Harbor Drive, Palm Harbor, Florida, or at such other place as the Payee hereof
may, from time to time, designate in writing, the principal sum of One Hundred
Sixty Thousand and No/100 Dollars ($160,000), with simple interest thereon
calculated at the rate of 12% per annum, from the date hereof until Maturity.
All principal shall be due and payable in full SIX MONTHS ("Maturity") from the
date hereof. The interest shall be due and payable on the 29th day of each month
beginning April, 1999, until Maturity.
Early Repayment
In the event the Undersigned wishes to repay the principal amount, in part or
whole, before Maturity, then interest on the portion of the Principal repaid
shall be calculated as set forth below:
- - for portions of the Principal held for greater than three (3) months but
less than six (6) months from the date hereof, interest shall be
calculated at the rate of 1.33% per month, with the period rounded to the
next larger whole month;
- - for portions of the Principal held for greater than one (1) month but less
than three (3) months from the date hereof, interest shall be calculated
at the rate of 1.94% per month, with the period rounded to the next larger
whole month;
- - for portions of the Principal held for greater than two (2) weeks but less
than one (1) month from the date hereof, interest shall be calculated at
the rate of 0.51% per week, with the period rounded to the next larger
whole week;
- - for portions of the Principal held for less than two (2) weeks from the
date hereof, interest shall be calculated at the rate of 0.55% per week,
with the period rounded to the next larger whole week;
<PAGE> 2
Each and all payments shall be applied first to interest at the rate of
aforesaid upon the principal sum or so much thereof as shall from time to time
remain unpaid, and the balance shall be applied on account of principal.
In the event of a default under this Note, the undersigned shall pay all costs,
and expenses of collection, including reasonable attorneys' fees.
This note is not assignable by either the payee or the undersigned Maker.
This note is to be construed and enforced according to the laws of the State of
Florida.
SEAL OF THE CORPORATION Dynacs Engineering Company, Inc.
By: /s/ Ramendra P. Singh
-------------------------
RAMENDRA P. SINGH
As: President/CEO
<PAGE> 3
AMENDMENT TO PROMISSORY NOTE
This Amendment to Promissory Note (the "Amendment") dated September 29,
1999 by and between Dynacs Inc. (formerly known as Dynacs Engineering Co., Inc.)
(the "Company") and Ramendra P. Singh (the "Payee").
Reference is made to that certain promissory note dated March 30, 1999 by
and between the Company and Payee in the principal amount equal to $160,000
(the "Promissory Note").
The parties agree that the Maturity of the Promissory Note shall be
extended to September 30, 2000.
All other terms and conditions of the Promissory Note shall remain in full
force and effect.
DYNACS INC.
By: /s/ Robert Rodriguez
_______________________
Robert Rodriguez
<PAGE> 1
Exhibit 10.24
[Letterhead of Dynacs Engineering Co. Inc.]
PROMISSORY NOTE
$400,000 Palm Harbor FL,
June 10, 1999
FOR VALUE RECEIVED, the undersigned, a Florida Corporation, promises to pay to
the order of Peter W. Likins or Patricia R. Likins (herinafter referred to as
the "Payees") at 100 North Camino Espanol, Tucson, Arizona 85716, or at such
other place as the Payees hereof may, from time to time, designate in writing,
the principal sum of Four Hundred Thousand Dollars ($400,000), with simple
interest thereon calculated at the rate of 12% per annum, from the date hereof
until Maturity. All principal shall be due and payable in full SIX MONTHS
("Maturity") from the date hereof. The interest shall be due and payable on the
10rd day of each month beginning July 1999, until Maturity.
Each and all payments shall be applied first to interest at the rate of
aforesaid upon the principal sum or so much thereof as shall from time to time
remain unpaid, and the balance shall be applied on account of principal.
In the event of a default under this Note, the undersigned shall pay all costs,
and expenses of collection, including reasonable attorneys' fees.
This note is not assignable by either the payees or the undersigned Maker.
This note is to be construed and enforced according to the laws of the State of
Florida.
SEAL OF THE CORPORATION Dynacs Engineering Company, Inc.
By: /s/ Ramendra P. Singh
-------------------------
RAMENDRA P. SINGH
As: President/CEO
<PAGE> 1
Exhibit 10.25
[Letterhead of Dynacs Engineering Co. Inc.]
PROMISSORY NOTE
$200,000 Palm Harbor FL,
June 10, 1999
FOR VALUE RECEIVED, the undersigned, a Florida Corporation, promises to pay to
the order of Robert Skelton or Judith Skelton (herinafter referred to as the
"Payees") at 445 Sea Lane, La Jolla, California 92037, or at such other place as
the Payees hereof may, from time to time, designate in writing. the principal
sum of Two Hundred Thousand Dollars ($200,000), with simple interest thereon
calculated at the rate of 12% per annum, from the date hereof until Maturity.
All principal shall be due and payable in full SIX MONTHS ("Maturity") from the
date hereof. The interest shall be due and payable on the 10rd day of each month
beginning July 1999, until Maturity.
Each and all payments shall be applied first to interest at the rate of
aforesaid upon the principal sum or so much thereof as shall from time to time
remain unpaid, and the balance shall be applied on account of principal.
In the event of a default under this Note, the undersigned shall pay all costs,
and expenses of collection, including reasonable attorneys' fees.
This note is not assignable by either the payees or the undersigned Maker.
This note is to be construed and enforced according to the laws of the State of
Florida.
SEAL OF THE CORPORATION Dynacs Engineering Company, Inc.
By: /s/ Ramendra P. Singh
-------------------------
RAMENDRA P. SINGH
As: President/CEO
<PAGE> 1
Exhibit 10.26
[Letterhead of Dynacs Engineering Co. Inc.]
PROMISSORY NOTE
$250,000 Palm Harbor FL,
February 23, 1999
FOR VALUE RECEIVED, the undersigned, a Florida Corporation, promises to pay to
the order of Ravi Venugopal (herinafter referred to as the "Payee") at 1528
Colony Ct., Palm Harbor, Florida, or at such other place as the Payee hereof
may, from time to time, designate in writing, the principal sum of Two Hundred
Fifty Thousand and No/100 Dollars ($250,000.00), with simple interest thereon
calculated at the rate of 12% per annum, from the date hereof until Maturity.
All principal shall be due and payable in full SIX MONTHS ("Maturity") from the
date hereof. The interest shall be due and payable on the 23rd day of each month
beginning March 1999, until Maturity.
Early Repayment
In the event the Undersigned wishes to repay the principal amount, in part or
whole, before Maturity, ten interest on the portion of the Principal repaid
shall be calculated as set forth below:
- - for portions of the Principal held for greater than three (3) months but
less than six (6) months from the date hereof, interest shall be
calculated at the rate of 1.33 % per month, with the period rounded to the
next larger whole month;
- - for portions of the Principal held for greater than one (1) months but
less than three (3) months from the date hereof, interest shall be
calculated at the rate of 1.94 % per month, with the period rounded to the
next larger whole month;
- - for portions of the Principal held for greater than two (2) weeks but less
than one (1) month from the date hereof, interest shall be calculated at
the rate of 0.51 % per week, with the period rounded to the next larger
whole week;
- - for portions of the Principal held for less than two (2) weeks from the
date hereof, interest shall be calculated at the rate of 0.55 % per week,
with the period rounded to the next larger whole week;
<PAGE> 2
Each and all payments shall be applied first to interest at the rate of
aforesaid upon the principal sum or so much thereof as shall from time to time
remain unpaid, and the balance shall be applied on account of principal.
In the event of a default under this Note, the undersigned shall pay all costs,
and expenses of collection, including reasonable attorneys' fees.
This note is not assignable by either the payee or the undersigned Maker.
This note is to be construed and enforced according to the laws of the State of
Florida.
SEAL OF THE CORPORATION Dynacs Engineering Company, Inc.
By: /s/ Ramendra P. Singh
-------------------------
RAMENDRA P. SINGH
As: President/CEO
<PAGE> 3
AMENDMENT TO PROMISSORY NOTE
This Amendment to Promissory Note (the "Amendment") dated August 22, 1999
and between Dynacs Inc. (formerly known as Dynacs Engineering Co., Inc.) (the
"Company") and Ravi Venugopal (the "Payee").
Reference is made to that certain promissory note dated February 23, 1999
by and between the Company and Payee in the principal amount equal to $248,000
(the Promissory Note").
The parties agree that the Maturity of the Promissory Note shall be
extended to August 23, 2000.
All other terms and conditions of the Promissory Note shall remain in full
force and effect.
DYNACS INC.
By: /s/ Ramendra P. Singh
--------------------------
Ramendra P. Singh
<PAGE> 1
Exhibit 10.27
[Letterhead of Dynacs Engineering Co. Inc.]
PROMISSORY NOTE
$89,301.44 Palm Harbor, Fl.
August 23, 1999
FOR VALUE RECEIVED, the undersigned, a Florida Corporation, promises to pay to
the order of Anil K. Singh (hereinafter referred to as the "Payee") at 128
Harbor Dr., Palm Harbor, Florida, or at such other place as the Payee hereof
may, from time to time, designate in writing, the principal sum of Eighty Nine
Thousand Three Hundred and One and 44/100 Dollars ($89,301.44), with simple
interest thereon calculated at the rate of 12% per annum, from the date hereof
until Maturity. All principal shall be due and payable in SIX MONTHS
("Maturity") from the date hereof. The interest shall be due and payable on the
23rd day of each month beginning beginning September 23, 1999, until Maturity.
Early Repayment
In the event the Undersigned wishes to repay the principal amount, in part or
whole, before Maturity, then interest on the portion of the Principal repaid
shall be calculated as set forth below:
- - for portions of the Principal held for greater than three (3) months but
less than six (6)months from the date hereof, interest shall be calculated
at the rate of 1.33% per month, with the period rounded to the next larger
whole month;
- - for portions of the Principal held for greater than one (1) month but less
than three (3) months from the date hereof, interest shall be calculated
at the rate of 1.94% per month, with the period rounded to the next larger
whole month;
- - for portions of the Principal held for greater than two (2) weeks but less
than one (1) month, from the date hereof, interest shall be calculated at
the rate of 0.51% per week, with the period rounded to the next larger
whole week;
- - for portions of the Principal held for less than two (2) weeks from the
date hereof, interest shall be calculated at the rate of 0.55% per week,
with the period rounded to the next larger whole week;
Each and all payments shall be applied first to interest at the rate of
aforesaid upon the principal sum or so much thereof as shall from time to time
remain unpaid, and the balance shall be applied on account of principal.
In the event of a default under this Note, the undersigned shall pay all costs,
and expenses of collection, including reasonable attorneys' fees.
<PAGE> 2
This Note is not assignable by either the payee or the undersigned Maker. This
Note is to be construed and enforced according to the laws of the State of
Florida.
SEAL OF THE CORPORATION Dynacs Engineering Company, Inc.
By: /s/ Harry W. Schubele, III
[SEAL] ----------------------------
Harry W. Schubele, III
As: Sr. Vice President, Business
<PAGE> 3
AMENDMENT TO PROMISSORY NOTE
This Amendment to Promissory Note (the "Amendment") dated August 22, 1999
by and between Dynacs Inc. (formerly known as Dynacs Engineering Co., Inc.) (the
"Company") and Anil K. Singh (the "Payee").
Reference is made to that certain promissory note dated February 23, 1999
by and between the Company and Payee in the principal amount equal to $89,301.44
(the "Promissory Note").
The parties agree that the Maturity of the Promissory Note shall be
extended to August 23, 2000.
All other terms and conditions of the Promissory Note shall remain in full
force and effect.
DYNACS INC.
By: /s/ Ramendra P. Singh
------------------------------------
Ramendra P. Singh
<PAGE> 1
EXHIBIT 21.1
Dynacs Properties, Inc., a Florida corporation.
Dynacs Digital Services, Inc., a California corporation.
Dynacs Technical Services, Inc., a Florida corporation.
Cerulean FXs, Inc., a Florida corporation.
Dynacs Digital Studios Pvt Ltd., a company organized under the laws of India.
Dynacs Engineering (India) Pvt. Ltd., a company organized under the laws of
India.
PT Dynacs Digital Studios, a limited liability company organized under the laws
of Indonesia.
Dynacs Digital Studios PTE LTD, a company organized under the laws of Singapore.
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
As independent certified public accountants, we hereby consent to the use
of our reports for the year ended December 31, 1998 and the nine-months ended
September 30, 1999, and to all references to our Firm, included in or made a
part of this registration statement.
Arthur Andersen LLP
Tampa, Florida
March 27, 2000
<PAGE> 1
Exhibit 23.2
CONSENT OF CERTIFIED PUBLIC ACCOUNTANTS
We consent to the reference to our firm under the captions "Experts" and
"Financial Statements" and to the use of our audit reports dated August 28, 1998
and July 29, 1999 on Dynacs Inc. (formerly known as Dynacs Engineering Co.,
Inc.) and Subsidiaries for the years ending December 31, 1997 and December 31,
1998, respectively, in the Form S-1 Registration Statement filed on behalf of
Dynacs Inc. (formerly known as Dynacs Engineering Co., Inc.) and Subsidiaries in
Form 8-A filed on behalf of Dynacs Inc. (formerly known as Dynacs Engineering
Co., Inc.) and Subsidiaries under Section 12(g) of the Securities Exchange Act
of 1934 which incorporates the 1933 Act filing by reference, and for the
offering memorandum of subordinated convertible promissory notes and warrants.
Dated: March 28, 2000 Hoyman, Dobson & Company, P.A.
By: /s/ DEBORAH A. BRADLEY
------------------------------------
Title: /s/ AUDIT DIRECTOR
-----------------------------------
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> DEC-31-1999
<CASH> 183,397
<SECURITIES> 0
<RECEIVABLES> 4,206,661
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 6,038,423
<PP&E> 5,428,306
<DEPRECIATION> 2,379,643
<TOTAL-ASSETS> 12,264,440
<CURRENT-LIABILITIES> 10,505,567
<BONDS> 0
0
0
<COMMON> 53,553
<OTHER-SE> 1,203,042
<TOTAL-LIABILITY-AND-EQUITY> 12,264,440
<SALES> 0
<TOTAL-REVENUES> 17,630,259
<CGS> 0
<TOTAL-COSTS> 16,244,674
<OTHER-EXPENSES> 1,442,538
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 188,209
<INCOME-PRETAX> (278,680)
<INCOME-TAX> 69,000
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (209,680)
<EPS-BASIC> (.04)
<EPS-DILUTED> (.04)
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> SEP-30-1999
<CASH> 1,094,790
<SECURITIES> 0
<RECEIVABLES> 5,765,434
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 8,224,950
<PP&E> 5,370,208
<DEPRECIATION> 2,040,517
<TOTAL-ASSETS> 14,271,505
<CURRENT-LIABILITIES> 12,104,221
<BONDS> 0
0
0
<COMMON> 53,553
<OTHER-SE> 1,247,267
<TOTAL-LIABILITY-AND-EQUITY> 14,271,505
<SALES> 0
<TOTAL-REVENUES> 55,295,085
<CGS> 0
<TOTAL-COSTS> 54,297,751
<OTHER-EXPENSES> 3,444,599
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 491,279
<INCOME-PRETAX> (2,966,411)
<INCOME-TAX> 1,360,000
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,606,411)
<EPS-BASIC> (.30)
<EPS-DILUTED> (.30)
</TABLE>
<PAGE> 1
Exhibit 99.1
CONSENT OF DIRECTOR-NOMINEE
The undersigned hereby consents to the use of his name as a nominee to the
Board of Directors of Dynacs Inc., a Delaware corporation (the "Company"), in
the registration statement on Form S-1, including any amendment thereto, filed
by the Company with the Securities and Exchange Commission in connection with
the initial public offering of securities of the Company (the "Registration
Statement") and the related prospectus, and the filing of this Consent as an
exhibit to the Registration Statement.
IN WITNESS WHEREOF, the undersigned has caused this Consent to be executed
this ___ day of March 2000.
/s/ Michael G. Bolton
------------------------------
Name:
<PAGE> 1
Exhibit 99.2
CONSENT OF DIRECTOR-NOMINEE
The undersigned hereby consents to the use of his name as a nominee to the
Board of Directors of Dynacs Inc., a Delaware corporation (the "Company"), in
the registration statement on Form S-1, including any amendment thereto, filed
by the Company with the Securities and Exchange Commission in connection with
the initial public offering of securities of the Company (the "Registration
Statement") and the related prospectus, and the filing of this Consent as an
exhibit to the Registration Statement.
IN WITNESS WHEREOF, the undersigned has caused this Consent to be executed
this ___ day of March 2000.
/s/ Michael R. Burns
------------------------------
Name:
<PAGE> 1
Exhibit 99.3
CONSENT OF DIRECTOR-NOMINEE
The undersigned hereby consents to the use of his name as a nominee to the
Board of Directors of Dynacs Inc., a Delaware corporation (the "Company"), in
the registration statement on Form S-1, including any amendment thereto, filed
by the Company with the Securities and Exchange Commission in connection with
the initial public offering of securities of the Company (the "Registration
Statement") and the related prospectus, and the filing of this Consent as an
exhibit to the Registration Statement.
IN WITNESS WHEREOF, the undersigned has caused this Consent to be executed
this ___ day of March 2000.
/s/ Peter Likins
---------------------------------
Name:
<PAGE> 1
Exhibit 99.4
CONSENT OF DIRECTOR-NOMINEE
The undersigned hereby consents to the use of his name as a nominee to the
Board of Directors of Dynacs Inc., a Delaware corporation (the "Company"), in
the registration statement on Form S-1, including any amendment thereto, filed
by the Company with the Securities and Exchange Commission in connection with
the initial public offering of securities of the Company (the "Registration
Statement") and the related prospectus, and the filing of this Consent as an
exhibit to the Registration Statement.
IN WITNESS WHEREOF, the undersigned has caused this Consent to be executed
this ___ day of March 2000.
/s/ Robert E. Skelton
----------------------------------
Name:
