Exhibit 10.44
Master Service Agreement
October 28, 2002
United Parcel Service
and
APAC Customer Service, Inc.

 

 

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Master Service Agreement
This Agreement, made on October 25, 2002 and effective October 28, 2002, by and
between United Parcel Services OASIS Supply Corporation, a Delaware corporation,
having its principal place of business at 55 Glenlake Parkway, NE, Suite 200,
Atlanta, Georgia 30328, (“UPS” or “Company”) and APAC Customer Service, Inc. on
behalf of itself and its subsidiaries and affiliates having its principal place
of business at Six Parkway North, Deerfield, IL 60015 (“APAC” or “Vendor”), is
for inbound and outbound customer interaction management services and services
ancillary thereto. This Agreement hereby replaces that certain agreement by the
parties dated August 8, 1995 and effective July 10, 1995, which agreement has
terminated on its own terms and is hereby of no further force or effect.
WHEREAS, APAC is in the business of providing in-bound and outbound customer
interaction management services on behalf of its clients; and
WHEREAS, UPS is a company that offers its customers a parcel delivery service,
and
WHEREAS, UPS desires to retain APAC to perform services for inbound and outbound
customer service call center functions, customer service support and interaction
management services on its behalf, and APAC agrees to provide such services to
UPS according to the terms of this Agreement.
NOW, THEREFORE, for good and valuable mutual consideration, the receipt and
sufficiency of which are hereby mutually acknowledged, UPS and APAC hereby agree
as follows:
Section 1 — Services

A.  
Services Description. During the Term (as hereinafter defined), APAC shall
perform the Services (as hereinafter defined) pursuant to the requirements set
forth in this Agreement and the Services Addendum set forth in Attachment A. For
purposes of this Agreement, “Services” shall mean (i) the receipt, handling and
resolving of UPS-related customer service inquiries, and related services to UPS
Customers (“Customer Service Call (s)”, “Call(s)” or “Inquiries”) by APAC
employees functioning as customer service representatives, administrative
support, package information associates and claims associates (“CSR’s”) of
telephone calls, e-mail and other media initiated by third parties for the
purpose of responding to UPS’s marketing of certain services and/or products or
otherwise communicating with UPS and (ii) any other services as mutually agreed
upon by both parties. These functions will collectively be referred to as the
“Services”.
  B.  
Performance Standards. The Services provided by APAC shall meet the performance
standards set forth in Attachment A. Attachment A shall be modified by UPS from
time to time at UPS’s reasonable discretion and upon notice to APAC.
  C.  
Changes to Services. UPS may request APAC to change the Services being performed
by APAC under this Agreement and/or amend Attachment A due to changes in
business needs.

 

 

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Section 2 — Responsibilities of the Parties.

A.  
Services. APAC shall provide to UPS the Services in accordance with the terms,
conditions and charges set forth in this Agreement and its Attachment A, as may
be amended, in accordance with the terms and conditions stated herein.
  B.  
APAC’s Employees.

  1.  
In accordance with the terms and conditions set forth in this agreement, APAC
will provide its employees to perform the Services. APAC employees assigned to
perform the Services for UPS are solely the employees of APAC.
    2.  
APAC shall be solely responsible for all personnel related matters and expenses
thereof regarding the provision of the Services, including but not limited to
recruiting, interviewing, conducting criminal background and employment
reference checks, testing, selecting, hiring, employing, directing, managing,
training, monitoring attendance, monitoring quantity and quality of work, and
compensating all CSR’s, Team Leaders, HR/Recruiters, Site Management and
Administrative Personnel, except as otherwise provided herein, necessary to
perform the Services.
    3.  
APAC shall have sole authority and responsibility to counsel, discipline,
review, evaluate, set the pay rates of, set the hours of work of, and terminate
its employees who perform the Services. UPS management will not counsel or
discipline APAC employees.
    4.  
APAC agrees to obtain from all of its employees assigned to UPS a signed
statement in the form of Attachment B, indicating APAC’s employee understands
that he or she is not a UPS employee, and that if it is ever determined that he
or she actually was a UPS employee, he or she will disclaim all such benefits.
    5.  
APAC agrees that it will comply with all other applicable federal, state, or
local laws or regulations applicable to APAC as an employer regarding
compensation, hours of work, or other conditions of employment.
    6.  
APAC will arrange for and provide the training for CSRs. Training will include,
but may not be limited to, internal and outside classroom training, Project and
product education, and “on the job” training. CSR’s will receive initial new
hire training for basic skills, including APAC and UPS policies and procedures,
training on “Existing Core Programs” (e.g. one time pickup, tracking, Universal,
PI, Damage Notifier, Claims, CSTA, CPCP, CCR Processes), and may, in addition,
receive refresher training to enhance a CSR’s performance, training for
conversion from one Existing Core Program to another or to a different program,
and training for rate changes, existing programs other than Existing Core
Programs, new programs to be introduced, new program features, or new services.

 

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  7.  
In the event APAC proposes to have any Services under this Agreement performed
by personnel other than employees of APAC, APAC shall so notify UPS in advance.
Any such personnel shall be deemed subcontractors of APAC. APAC shall be fully
and solely responsible for the compensation and performance of all of its
employees and subcontractors. UPS reserves the right to reject any and all
subcontractors with respect to any or all Services proposed to be conducted
pursuant to this Agreement.
    8.  
UPS may, in its discretion notify APAC to remove from performance of Services
under this Agreement any employee of APAC or its subcontractors or any
subcontractor for any reasonable and lawful reason satisfactory to UPS. Nothing
in this provision shall be deemed to give UPS the right to require APAC to hire
or terminate any APAC employees or in any way act in a manner inconsistent with
APAC’s human resources policies and procedures; it is intended only to give UPS
the right to have APAC discontinue using an employee in the performance of the
Services.

C.  
Level of Staffing. APAC shall be solely responsible for staffing to the UPS
required level of CSR’s necessary to provide the Services as determined in
accordance with the performance standards set forth in Attachment A. Team Leader
ratios, coach ratios, administrative/clerical personnel, and management team
requirements are also set forth in Attachment A.
  D.  
Monitoring. Without prior notice to APAC and to the extent permitted by law, UPS
shall have the right to monitor and record, on-site at the Centers and remotely
outside the Centers, APAC’s CSRs handling Calls and performing Services for UPS.
UPS shall share the results of its monitoring upon request by APAC. APAC agrees
that it will secure from all employees serving as CSRs under this Agreement
written consent (in the form of Attachment E hereto) to be monitored by APAC and
UPS.
  E.  
Reports and Documentation. APAC will provide UPS with reports and other
documentation or information as may be reasonably requested by UPS from time to
time in order to verify that APAC’s performance of the Services is in compliance
with this Agreement. APAC and UPS will conduct a semi-annual review of all
reports and documentation to evaluate need.
  F.  
Audits. APAC will permit UPS, at UPS’s expense, to audit any of APAC’s systems,
documents, processes, data, or reports related to the performance of this
Agreement or payments due under this Agreement. Such audits shall be held at a
time and place during normal business hours. Any information obtained by UPS
pursuant to an audit shall be subject to UPS’s obligation to keep such
information confidential as more fully set forth in Section 11 hereto.

 

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G.  
Periodic Assessment. UPS shall have the right to conduct reasonable periodic
performance, operational and quality control reviews of APAC’s performance of
Services under this Agreement, provided that UPS shall provide no direct
supervision of APAC’s call centers or APAC’s employees. Such reviews shall be
performed during business hours and may include visits to the Centers for
verification of Service quality levels and other activities directly related to
obtaining information for quality control review purposes. UPS shall schedule
such reviews with APAC in advance.
  H.  
Quarterly Review. At the Option of UPS during each quarter of the Term of this
Agreement, representatives of APAC and UPS shall meet for review of the status
of matters contemplated by this Agreement, including but not limited to the
service, performance, quality performance, status of transition, enhancement to
Services and quality improvement processes. Each party shall bear its own costs
and expenses incurred in connection with such review.
  I.  
Annual Review. Annually in August or September, the parties will review the UPS
requirements in this Agreement and, if mutually agreed by the parties, such
contractual items as may be appropriate will be adjusted for future Services (to
be implemented on or after the commencement of the next calendar year) to
reflect changes in circumstances, including without limitation adjustments in
wages, COLA adjustments, key metrics, Base Rate and other charges, CS, PI and
Claims assessments, quality scorecards (content and scoring) and other metrics
and elements that affect the UPS business and the Services.
  J.  
Notice of Delay. In the event of an actual or potential delay in APAC’s
performance under this Agreement, APAC shall immediately notify the UPS Site
Manager by either fax or telephone, whichever is quicker, describing the cause,
effect and expected duration of such delay or failure and thereafter shall
immediately give notice to the UPS Site Manager of all changes to such
conditions.
  K.  
Forecasting. UPS will provide forecasting to APAC as detailed in Attachment A.
  L.  
Information Necessary for the Performance of Services. UPS shall use its best
efforts to provide accurate and factual information as may be required by this
Agreement, respond promptly and accurately to all reasonable requests for such
information made by APAC, and provide relevant new data and regular updates of
changes to data previously provided. APAC will rely upon information provided by
UPS in performing the Services and will not be responsible for any delay or loss
that arises due to the inaccuracy of UPS supplied data or information.
  M.  
Government Requirements. UPS shall obtain and maintain all licenses, franchises,
privileges, permits consents, exemptions, certificates, registrations, orders,
approvals, authorizations and similar documents and instruments that are
required by federal, state and local laws and regulations applicable to call
centers for Services provided under this Agreement.

 

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Section 3 — Facilities and Equipment.

A.  
Centers. Except as expressly set forth herein, APAC shall perform the Services
at the following location, now owned, or leased by UPS:

Newport News, Virginia

B.  
Acquisition and Security of the Centers.

  1.  
UPS shall be solely responsible for and shall bear all costs and expenses with
regard to the acquisition and/or leasing of the Centers, the maintenance of the
Centers structural components (including but not limited to foundation, walls,
windows, parking areas, roofs, conduit, HVAC, mechanical, plumbing and
electrical systems), insurance for the Centers, as provided herein, repair and
maintenance of the Centers, including maintenance of external grounds and
parking, external lighting, obligations under the Occupational Safety and Health
Act (OSHA) and other similar laws applicable to the provision, acquisition,
leasing and maintenance of the Centers, and all employees of UPS fulfilling UPS
responsibilities as described herein. During the Term of this Agreement, UPS
covenants that the Centers shall be maintained and kept in good order, condition
and repair, conducive to the efficient performance by CSR’s of their duties.
    2.  
Except to the extent of UPS’s obligations hereunder, APAC will be responsible
for safe-guarding the work area, providing a safe work environment,
investigating security breaches and taking all commercially reasonable remedial
steps regarding security breaches. APAC will be responsible for providing all
cameras and printing equipment necessary to create picture identity cards and
all supplies for access cards. APAC will also properly safeguard all equipment
and related materials, including UPS Proprietary Software, other UPS
Confidential or Proprietary Information and documents, other related systems,
and/or phone/communications lines. In the instance where equipment is owned by
UPS, APAC will ensure all equipment is inventoried and signed for by APAC’s
authorized representative upon installation and acceptance. At any time
thereafter, APAC retains responsibility and liability for any equipment that is
removed, exchanged, or modified, until such time as that equipment is signed for
by an authorized UPS representative releasing APAC of responsibility. APAC is
required to maintain a current equipment inventory listing subject to UPS audit
at any time. APAC’s liability will include, but not be limited to, the
replacement cost of any missing equipment or materials and/or loss due to misuse
or unauthorized access or use of any materials, equipment or systems.

 

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C.  
Equipment and Technology.

  1.  
UPS shall provide all computer hardware, telecommunications equipment, computer
and telecommunications software, furniture and fixtures required in the
efficient performance of the Services. Except as otherwise provided herein, UPS
shall be solely responsible for and shall bear all costs and expenses with
regard to the ownership, leasing and maintenance of such hardware, software and
equipment including, but not limited to upgrades, enhancements and add-ons
thereto. UPS shall provide APAC with access to UPS’s systems applicable to the
UPS programs being supported by APAC hereunder.
    2.  
UPS shall provide at its own cost, all telecommunications facilities, including
voice and data that are needed to conduct the day to day business of the
operation as described. UPS will provide, within reason, adequate floor or wall
spaces for these telecom facilities. APAC will be responsible for the cost of
any telecom facilities that it requires for its own internal use. The design and
installation of any APAC voice or data circuit that interconnect to any portion
of the UPS voice or data network must be pre-approved in writing by UPS.
    3.  
APAC shall operate UPS equipment, software or proprietary software, only for the
performance of Services for UPS and as directed by UPS. APAC shall not upgrade,
modify or otherwise alter UPS equipment, UPS software or UPS proprietary
software unless and until UPS gives APAC such direction and permission. APAC
shall utilize UPS equipment, UPS software and UPS proprietary software. APAC
agrees to make UPS whole for loss or damage to UPS equipment, UPS software or
UPS proprietary software provided by UPS for use in the Centers, to the extent
such loss or damage results from negligence, a failure to act, or willful
misconduct of an APAC employee.
    4.  
APAC shall utilize the applications systems currently utilized at the Center and
provided by UPS as of the effective date of this Agreement, and shall in
conjunction and cooperation with UPS, work to ensure a continuing smooth
interface between the APAC Center and UPS’s other operations.
    5.  
APAC will obtain UPS’s approval prior to implementing any third party software,
and related documentation, database management systems, data and technical
information, in the performance of the Services which APAC will not be able to
license to UPS or its designee upon termination of this Agreement as
contemplated herein, unless APAC will be able to provide UPS with an alternative
that will permit UPS or its designee to continue to perform the applicable
systems and Services after termination of this Agreement without degradation of
performance levels or reduction in functionality.
    6.  
APAC will provide personal computers and email access for APAC Center Management
and Administrative Personnel at the Center.

 

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  7.  
APAC will be responsible for control, repair, and replacement of headsets and
amplifiers at the original UPS supplied level of 1100. APAC is required to
maintain a current equipment inventory listing subject to UPS audit at any time.
When purchasing replacements for lost or damaged headsets and amplifiers, APAC
will furnish a model of comparable quality, features, compatibility and price to
those originally provided by UPS. If or when the agreement for services between
APAC and UPS is terminated, APAC will return to UPS the total number of headsets
and amplifiers provided, in good repair.

D.  
Supplies. APAC shall be responsible for and shall bear all expenses incurred in
the rendition of Services at the Center with respect to contracting for food
services and perishable supplies.

  1.  
This statement is a clarification of the term “perishable supplies”. Perishable
Supplies is agreed to be any and all supplies that are consumable in nature.
This includes but is not limited to.

  (a)  
Office supplies including photocopy paper, facsimile paper, other paper, toner,
pens, pencils, markers, erasers, paper clips, staples, tape calculators, etc.
    (b)  
Cleaning supplies including toilet paper, hand towels, napkins, sanitary
napkins, soaps, cleaning compounds, polishing compounds, trash can liners, etc.
    (c)  
Any and all items relating to contracted food vendors.

  2.  
Kitchen Maintenance. APAC shall retain responsibility and liability for and
shall bear all expenses incurred for kitchen maintenance.

  3.  
Trash and Waste Removal. APAC shall retain responsibility and liability for and
shall bear all expenses incurred in the rendition of Services at the Center with
the respect to the removal of all trash and hazardous waste.

E.  
Signs and Banners. APAC shall be entitled to erect exterior and interior signage
and banners solely in accordance with UPS’s prior written authorization, except
that UPS hereby consents to the posting of internal signage that is professional
and business like.

 

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Section 4 — Rates and Invoices

A.  
Rates for Services. The rates for the performance of the Services pursuant to
this Agreement shall be those listed in Attachment A.

B.  
Payment Terms. UPS and APAC agree that invoices for Services will be handled in
the following manner:

  1.  
APAC will invoice UPS on a weekly basis for Services rendered during the
preceding week. The invoices will be delivered no later than Wednesday to the
UPS Site Manager. The invoices will include the applicable Base Rate for APAC
personnel for each billable hour expended.

  •  
The invoice shall be based on the actual APAC paid production hours as
contemplated by the Final Matrix and permitted changes to the Final Matrix. The
Final Matrix as defined will be the local site agreement 2 weeks prior to
implementation. Hours billed to UPS from APAC may vary from the Final Matrix for
the following reasons:

  •  
Overtime hours which UPS has approved in writing. Overtime shall be paid by UPS,
in accordance with the rates as provided in the Agreement.
    •  
UPS approved training hours.
    •  
If UPS has requested that APAC increase staffing, APAC will do everything
possible to fill the request for additional FTEs with Part Time or Full Time
hours (“Expanded Hours”). Expanded Hours will be billed at the Base Rate. Hours
that APAC is unable to fill with Expanded Hours shall be billed at the overtime
rate. All Overtime must be pre-approved in writing by the UPS site manager or
their designee.

  •  
The following steps shall be used to develop “Required” hours:

  •  
The Final Matrix will be used to determine the final FTE requirements. The Final
Matrix will be provided by UPS four (4) weeks in advance.

  •  
Coaches’ hours will be billed as actual hours worked never to exceed the agreed
upon ratio of one coach per twelve (12) CSRs to UPS by the following
calculation: Divide the required FTE CSR approved in the Final Matrix by 12 and
multiply by eight. Example for calculation of the coach billable hours:

     
Total Required hours = 2,929
     
Total Required FTE’s = 391{2,929/7.5}
     
Coach Hours Billable = 391/12*8 = 260.67 hours

  •  
Coaches’ Overtime hours must be pre-approved in writing by the UPS site manager
or designee. If the actual volume is less than expected, APAC will do all
possible to reduce coach staffing. However, UPS will be responsible for all
hours worked up to the agreed ratio of 1:12 as planned in the Final Matrix.

 

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  2.  
Invoices submitted by APAC shall be due and payable within fifteen (15) days of
receipt of the invoice.
    3.  
If UPS management has any questions or concerns regarding the accuracy of the
invoice, every effort will be made to resolve the issue(s) and make any
adjustments warranted within twenty-four (24) hours from the time UPS raises
such questions or concerns.
    4.  
If any items remain in dispute after twenty (24) hours, the reason for the
dispute will be documented by UPS in writing and the undisputed amount will be
processed for payment in accordance with Section 4.B.2 above.
    5.  
No subsequent week’s invoices will be delayed as a result of a dispute of a
prior week’s invoice.
    6.  
APAC will make every effort to complete research on any disputed amounts as
expeditiously as possible, but no later than ten (10) days after the written
explanation of the dispute is received. After any APAC research is complete, any
adjustments to an invoice will be made on the subsequent week’s invoice to be
presented to UPS.
    7.  
The UPS Site Manager and APAC Site Management, or their designees will use their
best efforts to resolve all disputed amounts within fifteen (15) days of the
invoice date. Any disputes remaining after such fifteen (15) days will be
escalated to the parties’ senior management for resolution.

C.  
Costs and Expenses. Except as otherwise expressly provided in this Agreement and
its Attachment A, any and all costs and expenses incurred by APAC in its
performance of the Services shall not be reimbursed by UPS.
  D.  
Set-Off Rights. With respect to any amount that: (1) should be reimbursed to UPS
or (2) is otherwise owed or payable to UPS pursuant to this Agreement, UPS may
upon written notice to APAC deduct the entire amount owed to UPS against the
charges or amounts otherwise payable or expenses owed to APAC under this
Agreement.

 

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E.  
Presently Unforeseen Events. In the event that during the term or additional
term of the Agreement, APAC’s costs for hourly employee rates are increased
pursuant to a collective bargaining agreement, UPS will not be responsible for
any such increase and such increase will not be passed on to UPS. In the event
that any presently unforeseen event, circumstance or condition or any
combination thereof first occurring after the date of execution of this
Agreement (i.e., a dramatic increase in health care costs or a new employer near
a Center which attempts to attract APAC’s employees at higher wage rates) that
(i) is not occasioned by or resulting solely from the actions of APAC or any
APAC employee; (ii) is expected to continue for a period exceeding six
(6) months; and (iii) shall adversely increase the cost to APAC of performing
Services at a Center by more than five percent (5%) of its prior provable costs
(“Adverse Event”), APAC shall be entitled to request an adjustment to the Base
Rate set forth in Attachment A by written notice delivered to UPS at least sixty
(60) days prior to the proposed date of adjustment. To that end, APAC shall
deliver with its request to UPS such documentation, detailed records, pricing
and financial information and other data as shall verify the existence of such
Adverse Event and APAC’s increased costs resulting therefrom; provided, however,
that such request shall in any event be subject to UPS’s right to audit APAC’s
submissions during the thirty (30) day period. In the event that UPS and APAC
have not agreed to an adjusted Base Rate by the end of such thirty (30) day
period, or such extension thereof as may be mutually agreeable, then,
notwithstanding anything in this Agreement to the contrary, APAC may terminate
its Services at such Center upon one hundred twenty (120) days prior written
notice which notice must be given no later than fifteen (15) days following such
thirty (30) day period (as may be extended).

Section 5 — Taxes

A.  
Taxes Payable by UPS. Any use, excise, sales or privilege taxes, duties, value
added taxes, fees, or assessments which may now or hereafter be levied on the
Services, software, equipment, materials or other property (tangible or
intangible) provided under this Agreement, chargeable to or against APAC
(provided that APAC is not responsible for these charges through its own
omission(s) or negligence) by any applicable government authority, shall be
passed through to and payable by UPS. APAC shall clearly identify the charges
referenced herein on any invoice. Should APAC be required to pay or should APAC
pay these taxes, fees, assessments or similar liabilities, UPS shall promptly
reimburse APAC for such payments upon receipt of an invoice from APAC. UPS shall
also timely pay all use, excise, sales or privilege taxes, duties, value added
taxes, fees, assessments or similar liabilities levied against it by any
governmental authority for its role in the leasing, ownership or operation of
the Centers. Taxes chargeable against the income of APAC shall be paid by APAC
and are not a chargeable item hereunder. APAC and UPS shall cooperate in the
preparation and filing of any tax returns. Any penalties or interest associated
with the failure of APAC to timely collect or pay any tax shall be the
responsibility of APAC unless such failure was caused by UPS’s direction or
UPS’s failure to pay taxes to APAC in accordance with this section.

 

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B.  
Employment-Related Taxes. APAC is responsible for the filing of any and all
returns and reports and the withholding and/or payment of all applicable
federal, state, and local wage taxes, or employment-related taxes, including,
but not limited to, income taxes, gross receipt taxes, taxes measured by gross
income, social security taxes and unemployment taxes for APAC, APAC’s employees,
and any other agents or subcontractors employed by APAC to perform Services
under this Agreement. APAC shall reimburse UPS for any taxes not withheld or
paid by APAC in accord with this paragraph, including reasonable attorney’s
fees, penalties and interest UPS may incur due to APAC’s failure to make such
withholdings or payments, and APAC shall participate at APAC’s sole expense and
at the request of UPS in UPS’s defense of all such claims.
  C.  
Contest of Tax Issues. In its sole discretion and at its own expense, UPS has
the right, either before or after payment of any tax, to contest the validity or
application of taxes described in Section 5.A.1 that are submitted by APAC to
UPS for payment. Upon the written request of UPS, APAC shall fully cooperate
with UPS in contesting or protesting the validity or application of any such tax
(including, but not limited to, permitting UPS to proceed in APAC’s name if
required or permitted by law, provided, in each case, that such contest does
note involve, or can be separated from, the contest of any tax or issues
unrelated to transactions described in this Agreement). UPS shall also have the
right to participate in any contest conducted by APAC with respect to a tax or
other charge indemnifiable under this section, including without limitation, the
right to attend conferences with the taxing authority and the right to review
submissions to the taxing authority or any court to the extent such contest does
not involve, or can be separated from, the contest of any tax or issues
unrelated to the transactions described in this Agreement. In the event APAC
shall receive a refund of all or any part of such tax which UPS has paid and
discharged, the amount of such refund shall promptly be remitted to UPS by APAC.
  D.  
Tax Credits. UPS shall be entitled to the benefit of any jobs tax credit,
enterprise zone tax credit, capital investment tax credit, or any other similar
type of tax credit earned pursuant to this Agreement for the one (1) Center
originally stated in Section 3.A. herein that it chooses to actively pursue. In
the event the federal, state, or local law allowing for such tax credit provides
that APAC is the recipient of such tax credit, APAC shall pass on the tax credit
benefit to UPS in the form of a reduction in the amount of APAC’s invoice. Under
this provision, APAC is deemed to receive the benefit of the tax credit on the
earlier of the due date of APAC’s return or estimated payment following the
determination of a credit amount. APAC’s next invoice will be reduced by the
amount of the credit. In the event that APAC discovers or pursues additional tax
or related credits that UPS has not pursued, and is or shall be successful in
obtaining such credit, the Parties will discuss such credit or potential credit,
and will determine an appropriate split of credit revenues during the next
available quarterly or annual review. Tax credit computations and invoice
reductions are subject to verification by UPS.

 

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Section 6 — Warranties

A.  
APAC warrants to, UPS that (1) APAC shall use its best efforts to perform all
Services in a professional manner and in accordance with the Agreement and
Attachments, or any other applicable mutually agreed upon written
specifications; and (2) APAC has or will have agreements and/or acknowledgements
in place with all employees and subcontractors sufficient to enable APAC to
comply with all provisions of this Agreement.
  B.  
APAC further warrants that neither APAC proprietary software, nor that which it
creates to render Services hereunder shall infringe any United States copyright,
patent, trademark or any other third party intellectual property rights, unless
such infringement is caused solely by the combination, modification, enhancement
or alteration by UPS or at UPS’s specific written instruction. In the event of
an infringement claim, APAC may, at its option and at its expense, either
(1) defend such claim with competent counsel of its choosing; (2) procure the
right to continue using such software to provide the Services; or (3) substitute
for such hardware or software, other hardware or software which performs the
same functions without any loss of speed or functionality that would otherwise
cause either party’s non-compliance with this Agreement.
  C.  
UPS warrants that neither UPS proprietary hardware or software it supplies to
APAC to render Services hereunder, nor any modifications, enhancements,
alterations or combinations to third party hardware or software UPS performs or
performed, creates or created, or requires APAC to perform or create upon
written instructions, shall infringe upon any United States copyright, patent,
trademark or any other third party intellectual property rights unless such
infringement is caused solely by combination, modification, enhancement or
alteration of such hard or software by APAC without instruction from UPS. In the
event of an infringement claim, UPS may, at its option and at its expense,
either (1) defend such claim with competent counsel of its choosing; (2) procure
the right to continue using such hardware or software to provide the Services;
or (3) substitute for such hardware or software, other hardware or software
which performs the same functions without any loss of speed or functionality
that would otherwise cause either party’s non-compliance with this Agreement.
  D.  
This Section shall survive termination or expiration of this Agreement.

 

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Section 7 — Indemnity
APAC agrees to indemnify, protect and hold UPS and its directors, officers and
employees, harmless from and against any and all third party claims (including,
but not limited to losses, judgments, damages, settlements and expenses for
those actions to the extent they result from (i) the negligence or willful
misconduct of APAC, including but not limited to third party claims for injury
or death to persons, including APAC employees, or damage to property or business
entities, and (ii) claims that APAC’s product, including hardware, software or
any combination thereof, constitutes an infringement of a United States patent,
copyright, trade secret or other intellectual property right of any third party.
APAC further agrees to hold UPS harmless and to indemnify UPS for any amount of
money, including attorney’s fees, that UPS may incur as a result of claims
brought against UPS by APAC’s employees for employment discrimination, workers,
compensation, or unemployment compensation. The indemnity set forth in this
Section and the limitation of liability set forth in the following Section
hereof shall survive the expiration or termination of the Term or Additional
Term of this Agreement.
Section 8 — Limitation of Liability
Neither Party shall be liable to the other for special, exemplary, punitive,
indirect, incidental or consequential damages, including, without limitation,
damages for lost opportunities or lost profits, even if such damages were
foreseeable or result from a breach of Agreement, except and only to the extent
attributable to a Party’s willful misconduct or gross negligence.
Section 9 — Insurance

A.  
APAC Maintained Insurance. APAC shall, at its own cost and expense, obtain and
maintain in full force and effect, with sound and reputable insurers, during the
term of this Agreement, the following insurance coverages: (a) Worker’s
Compensation insurance as required by law of the state of hire; (b) Employer’s
Liability Insurance with minimum limits of $1,000,000 of liability, and not less
than $1,000,000 aggregate limit of liability per policy year for disease,
including resulting death, not caused by accident; (c) A combination of
Comprehensive General Liability and Umbrella Policy Insurance against all
hazards with a minimum limit of liability for personal injury, including
resulting death, on an occurrence basis of $10,000,000 in the aggregate, and
with a minimum limit of liability for property damage on an occurrence basis of
$10,000,000 in the aggregate; (d) A combination of Umbrella Policy Insurance and
Automobile Liability Insurance against liability arising from the maintenance or
use of all owned, non-owned and hired automobiles and trucks with a minimum
limit of liability for property damage of $5,000,000 per accident; (e) Fire
Legal Liability Insurance of $1,000,000 and (f) Crime Insurance, including at a
minimum fidelity coverage, employee dishonesty, robbery, theft, forgery,
computer theft and fraud covered with a minimum of $5,000,000 per loss. If not
already provided, APAC shall provide UPS with certificates of insurance
evidencing the coverages required hereunder within ten (10) days after execution
of this Agreement. Each policy required hereunder shall name UPS, its
affiliates, directors, officers and employees as additional insureds and shall
provide that APAC shall endeavor to provide UPS with thirty (30) days’ advance
written notice in the event of a cancellation or material change in such policy.
In the event that any Service under this Agreement is to be rendered by persons
other than APAC’s employees. APAC’s insurance shall cover such persons under the
same terms and conditions.

 

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B.  
UPS Insurance. UPS shall maintain insurance in such amounts as may be
commercially adequate for all property damage and personal injury losses as may
relate to UPS’s ownership, leasing, operation and maintenance of the Centers. If
not already provided, UPS shall provide APAC with certificates of insurance
evidencing the coverages required hereunder within ten (10) days after execution
of this Agreement. Each policy required hereunder shall name APAC as an
additional insured and shall provide that APAC shall receive thirty (30) days’
advance written notice in the event of a cancellation or material change in such
policy. In the event that any UPS obligation under this Agreement is to be
rendered by persons other than UPS employees (excluding all APAC employees),
UPS’s insurance shall cover such persons under the same terms and conditions.

Section 10 — Force Majeure

A.  
Occurrence of Force Majeure. If either party to this Agreement shall be
prevented, hindered, or delayed in the performance or observance of any of its
obligations hereunder by reason of any circumstance defined in this
Section 10.A., and such delay could not have been prevented by reasonable
precautions and cannot reasonably be circumvented by the party through the use
of alternate sources, work-around plans, or other means, then such party shall
be excused from any further performance or observance of the obligation(s) so
affected for as long as such circumstances prevail and such party continues to
use its best efforts to recommence performance or observance whenever and to
whatever extent possible without delay. APAC as the affected party shall not
have the right to any additional payments from UPS as a result of any force
Majeure occurrence, nor shall UPS as the affected party have the right to any
additional material Services from APAC not encompassed by this Agreement.
Neither Party shall be liable to the other for failure or delay in rendering
performance arising out of the following causes. Acts of God or the public
enemy, terrorism, strikes, wars, fires, floods epidemics, quarantine,
restrictions, or unusually severe weather and similar events beyond the control
of such party (an occurrence of a “Force Majeure”).
  B.  
Process and Procedure for a Force Majeure. Upon the occurrence of a Force
Majeure, the affected party shall immediately notify the other by telephone and
confirm in writing within forty-eight (48) hours of such call describing with
specificity the details of such occurrence and its expected effect on the
obligations of the affected party hereunder. If APAC is the affected party and
UPS is thus prevented from conducting a significant portion of UPS’s normal
business operations at the Center for five (5) business days after notification,
despite the parties best efforts, then, at any time thereafter and until such
time as APAC is able to resume or so arrange for acceptable alternative
performance, UPS may suspend this Agreement at the Center and seek alternative
performance until such time as APAC is able to continue. Any such suspension by
UPS shall be without penalty or termination charges and shall be effective as of
a date specified by UPS in a written notice of suspension to APAC. If either
party is unable to perform at the Center under this Agreement due to force
majeure cases for a period of sixty (60) days then the other party may terminate
this Agreement in whole or in part as to the Center and such termination shall
be considered for the convenience and benefit of both parties.

 

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Section 11 — Confidentiality/Proprietary Information.

A.  
Confidentiality Agreements. Prior to performing Services on behalf of UPS, APAC
and each APAC employee assigned to perform work under this Agreement shall read,
understand, adhere to, and sign an APAC Customer Services, Inc. Employee
Nondisclosure Agreement attached as Attachment “D” and an APAC Customer
Services, Inc. Employee Statement of Understanding/Confidentiality attached as
Attachment “E”.
  B.  
Agreement to Keep Information Confidential. The Parties agree that any and all
confidential information and/or proprietary information relating to past,
present and future activities, products, services, business plans, business
practices designated as confidential, or information that by its nature is
presumed to be confidential (“Confidential Information”) (including UPS Customer
lists, UPS card numbers, UPS Customer names, addresses and billing data, call
detail and/or financial information, information relating to UPS Customers or
UPS Customer account information, and/or databases, as well as other material
specifically designated by UPS in writing as confidential or proprietary) (“UPS
Confidential or Proprietary Information”)) furnished or disclosed in the course
of this Agreement, or disclosed during the effective period(s) of other
Nondisclosure Agreement(s) in effect between the Parties, shall be and remain
UPS or APAC property, as the case may be. During the term of this Agreement and
for two (2) years thereafter, both Parties agree not to reveal, disclose,
divulge, sell, license, exchange, lease or in any other way transfer the other
Party’s Confidential Information to any third party. Neither Party shall use the
other Party’s Confidential Information for any purposes other than the Services
to be performed hereunder without prior express written permission of the other
Party and shall limit its copying of such Confidential Information to such
purposes and shall not disclose any such Confidential Information to anyone
except its personnel to whom such disclosure is necessary to carry out the
purposes of this Agreement. All such personnel shall be appropriately notified
that any such disclosure to them is made in confidence and shall be held in
confidence. In the event any such Confidential Information must be disclosed by
a Party to a third person for the purpose of allowing the Party to provide the
Services hereunder, the Party shall, prior to disclosure, obtain the other
Party’s written permission and if permission is granted, shall obtain from the
third person a written agreement regarding the confidentiality and specific use
of the confidential Information, the terms of which shall be substantially
identical to those contained herein. Either Party shall forward a copy of such
third person’s nondisclosure agreement to the other Party upon written request.

 

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C.  
Non-Confidential Information. The provisions of Paragraph 11.A. above shall not
apply to information that was previously known to the other Party, free of any
obligation to keep it confidential as evidenced by written records, or
information that is or has been disclosed in the public domain, through no fault
of the other Party, by third persons who are under no obligation of confidence
to either UPS or APAC, or information independently developed by the other Party
or obtained by a third party. Any combination of Confidential Information
disclosed from UPS to APAC or APAC to UPS, shall not be deemed to be within the
foregoing exceptions merely because individual portions of such combinations are
disclosed or separately known in the public domain or known by the other Party.
Either Party may disclose Confidential Information if obligated by Court order
or governmental process after providing the other Party with prior notice that
Confidential Information is being sought by legal process.
  D.  
Injunctive Relief. Both Parties acknowledge that the Confidential Information
under this Agreement constitutes unique, valuable and special trade secret and
business information of the respective Parties, and that disclosure of such
Confidential Information may cause irreparable injury to UPS or APAC as the case
may be. Accordingly, the Parties acknowledge and agree that the remedy at law
for any breach of the covenants contained in Paragraph 11.A. of this Agreement
may be inadequate, and in recognition, agree that the other Party shall, in
addition, be entitled to seek injunctive relief and reasonable attorneys’ fees
and other court costs and expenses, in the event of a breach.
  E.  
Disclosures Required By Law. Either Party may file copies of this Agreement with
a court or public agency, to the extent necessary to comply with applicable law
or regulation, including, without limitation, to comply with mandatory filing
under the rules and regulations of the Securities and Exchange Commission and to
the extent necessary in connection with review by lending institutions, subject
to appropriate confidentiality restrictions and subject to Section 13. The
filing Party shall promptly notify the other Party of such requirement.

Section 12 — Miscellaneous Confidentiality Requirements

A.  
Until the expiration or termination date of this Agreement, except as permitted
by this Section 12.A, APAC will not engage in the performance of services
similar to the Services on behalf of any parcel delivery company that is not, as
of the execution hereof, a current client or as to which APAC has a bid
currently pending as of the execution date hereof, including but not limited to
Federal Express, Emery, United States Postal Service, or Airborne, unless it can
be demonstrated to UPS in its reasonable judgment acting in good faith that
there is no reasonable probability that its Proprietary Information can be used
to benefit its competitors. With respect to any bid currently pending or any
services as to which UPS otherwise agrees that APAC’s opportunity meets the
standard set forth herein, APAC will enforce the Confidentiality and “Firewall”
terms set forth in Attachment “B”, as appropriately modified to fit the specific
opportunity being addressed. With respect to UPS, APAC will enforce the
Confidentiality and “Firewall” Terms set forth in Attachment “B”.

 

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B.  
Unless the written consent of UPS shall first be obtained, or unless otherwise
required by applicable securities laws, at which time, APAC shall use its best
efforts to provide UPS with an opportunity to review and provide comment on
disclosures required by applicable securities laws, as determined by APAC as
such disclosures pertain to UPS, APAC shall not at any time, notwithstanding the
expiration of the term or the termination of this Agreement, in any manner
advertise or publish or release for publication any statement mentioning UPS or
the fact that APAC is furnishing or has furnished or agreed to furnish Services
to UPS. The provisions of this Section 12.B. shall survive the termination or
expiration of this Agreement.

Section 13 — Laws and Regulations

A.  
Compliance with Law. Each of the Parties will perform its obligations under this
Agreement in compliance with all applicable laws, ordinances and regulations and
will obtain and maintain in full force and effect, any permits, licenses,
consents, approvals and authorizations necessary for the performance of its
obligations hereunder.
  B.  
APAC Requirements. Except as may be otherwise provided in this Agreement, APAC
agrees that it will comply with all laws and regulations applicable to APAC’s
employees and telemarketing, including but not limited to the Fair Labor
Standards Act, Title VII of the Civil Rights Act of 1964, the Age Discrimination
in Employment Act of 1967, the Rehabilitation Act of 1973, the Immigration
Reform and Control Act of 1986, the Americans with Disabilities Act of 1990, the
Occupational Safety and Health Act (OSHA), the affirmative action
responsibilities to comply with the office of Federal Contract Compliance
Program (OFCCP) Guidelines and such other federal, state, and local employment
laws which may be enacted during the life of this Agreement and/or are in effect
or hereinafter enacted dealing with APAC’s workforce. In performing Services and
without limiting the generality of the foregoing, APAC shall also comply with
any and all rules and regulations promulgated pursuant to the Telemarketing and
Consumer Fraud Prevention Act of 1994.
  C.  
Subcontract Flowdown. APAC agrees to comply with the following Federal
Acquisition Regulation (FAR) clauses, to the extent that they are applicable,
which are incorporated in this Agreement by reference to implement provisions of
United States laws or Executive Orders.

  1.  
FAR clauses applicable to all contracts:

  (1)  
48 C.F.R § 52.222-26, Equal Opportunity (E.O. 11246);
    (2)  
48 C.F.R. § 52.222-35, Affirmative Action for Disabled and Vietnam Era Veterans
(38 U.S.C. §4212(a)); and
    (3)  
48 C.F.R. § 52.222-36, Affirmative Action for Workers with Disabilities (29
U.S.C. §793).

 

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  2.  
Not withstanding any other clause of this Agreement, APAC is not required to
include any FAR provision or clause, other than those listed in (a) above, to
the extent they are applicable (and as may be required by an addenda to this
paragraph to establish the reasonableness of prices under FAR Part 15), in a
subcontract at any tier for commercial items or commercial components.
Commercial item, as used in this clause, has the meaning contained in the clause
at 48 C.F.R. §52.202-1, Definitions.
    3.  
FAR clauses applicable to certain contracts as specified in each clause:

  (1)  
48 C.F.R. § 52.203-6, Restrictions on Subcontractor Sales to the Government, as
amended by Alternate I (41 U.S.C. § 253(g) and 10 U.S.C. § 2402);
    (2)  
48 C.F.R. § 52.219-8, Utilization Of Small Business Concerns And Small
Disadvantaged Business Concerns (15 U.S.C. § 637(d)(2) And (3);
    (3)  
48 C.F.R. § 52.219-9, Small Business Subcontracting Plan (15 U.S.C. §
637(d)(4));
    (4)  
48 C.F.R. §52.222-37, Employment Reports on Disabled Veterans and Veterans of
the Vietnam Era (38 U.S.C. § 4212); and
    (5)  
48 C.F.R. § 52.222-41, Service Contract Act of 1965, as Amended (41 U.S.C. §
351, et. Seq.).

  4.  
APAC shall include the terms of this clause, including this Section 13.C., in
subcontracts awarded under this Agreement.

D.  
UPS Requirements. UPS will be responsible for the cost of implementing all
necessary Americans With Disabilities Act (ADA) reasonable accommodations to
facilities. Regarding equipment, UPS will be responsible for providing all
equipment necessary to comply with the ADA up to an aggregate value of five
thousand dollars ($5,000.00) per Center.
  E.  
Controlling Law. This Agreement shall be construed in accordance with the laws
of the State of Georgia.

Section 14 — Property and Proprietary Rights

A.  
Ownership of Data. As between APAC and UPS, UPS will own exclusively all data
collected as a direct result of the performance of services under this
Agreement. APAC will keep such data confidential pursuant to the confidentiality
provisions of this Agreement. APAC will maintain safeguards against the
destruction, loss or alteration of UPS data in the possession of APAC that are
no less rigorous than those maintained by APAC for its own information of a
similar nature.

 

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B.  
Limited Use of Marks. Each Party warrants and represents that it has full right
title marks (“Marks”) which it provides to the other Party, if any, for use and
interest in and to all trade names, trademarks, service marks, symbols and other
proprietary related to the Project and the Services, and that any Marks provided
by a Party will not infringe the marks of any third party. During the Term of
this Agreement, the providing Party grants to the other Party the non-exclusive
right to reasonably utilize the Marks in connection with the obligations of the
Parties hereunder, including, but not limited to, internally on banners (e.g.,
to identify UPS’s facility, if applicable), poster (e.g., for internal
promotions), in APAC newsletters, closed-circuit television and training. In
this regard, each Party will use the other Party’s Marks only for authorized
purposes, only to the extent authorized, and only in the authorized manner, in
connection with the Services under this Agreement. In order to ensure proper
use, the providing Party will provide to the receiving Party, upon request,
camera ready art, beta quality video and/or digital tiff, eps or bitmap file of
the providing Party’s Marks, if appropriate.
  C.  
Miscellaneous Intellectual Property Rights. Each Party will retain all rights in
any software, ideas, concepts, know-how, processes, development tools,
techniques or any other proprietary material or information that it owned or
developed prior to the date of this Agreement, or acquired or developed after
the date of this Agreement without use or incorporation of the intellectual
property of the other Party. Subject to any third party rights or restrictions
and the other provisions of this Section 14, UPS will own any deliverables that
are specified in the Agreement and/or its Attachment A that (i) are custom
developed specifically for UPS and delivered by APAC under this Agreement and
(ii) are paid for by UPS. Notwithstanding anything to the contrary in this
Agreement, APAC (i) will retain all right, title and interest in and to all
proprietary systems and solutions (however modified for use for the Project),
software development tools, know-how, methodologies, processes, technologies or
algorithms used in performing the Services which are based on trade secrets or
proprietary information of APAC or are otherwise owned or licensed by APAC
(collectively, ’tools”), (ii) subject to its confidentiality and
non-infringement obligations under this Agreement, and insofar as APAC is in the
business of creating innovations in its industry, will be free to use any ideas,
concepts, know-how and other intangible intellectual property which are
developed or created in the course of performing the Services and may be
retained by APAC’s employees in intangible form and (iii) will retain ownership
of any APAC-owned software or tools that are used in producing any deliverables
and become embedded in such deliverables. Nothing will impair APAC’s ability to
acquire, license, market, distribute for itself or others or have others develop
for it similar deliverables performing the same or similar functions as the
deliverables contemplated by this Agreement and/or its Attachment A.

 

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Section 15 — Fraud Procedures.

A.  
APAC Requirements. APAC shall use reasonable efforts to take the following
measures to help minimize fraud:

  1.  
Destroy all CSR notes used at the Centers periodically as directed by UPS;

  2.  
Give UPS reasonable and appropriate assistance in the investigation of fraud by
an APAC employee and bear the investigation, restitution, and recovery costs
involved in any proven cases of fraud;

  3.  
APAC is responsible for reviewing and obtaining a signed Integrity form (See
Attachment C) from each employee.

  4.  
Make reasonable efforts to establish and implement a standard operating
procedure for maintaining a paperless environment absent exigent circumstances;
and

  5.  
Establish and implement a standard operating procedure to control the
recordation of customer authorization codes in any media except as jointly
agreed upon by UPS and APAC to support the delivery of Services and absent
exigent circumstances.

B.  
Periodic Reviews. APAC shall allow UPS to make periodic reviews of APAC’s fraud
procedures, as such procedures relate to fraud control hereunder.

Section 16 — Events of Default

A.  
Failure to Pay Amounts When Due. Subject to the notice and cure provisions
provided in this clause, UPS’s failure to pay undisputed amounts when due under
the terms and conditions of this Agreement shall constitute an Event of Default.
In the event that UPS fails to make any payment which constitutes an Event of
Default, APAC shall give UPS written notice thereof. UPS shall then have fifteen
(15) days to cure such breach.

B.  
Failure of a Party to Perform Its Material Obligations. Subject to the notice
and cure provisions provided herein, a Party’s failure to perform any material
obligation under the Agreement shall constitute an Event of Default. In the
event that a Party has failed to perform any of its material obligations under
the Agreement and has failed to remedy the same following thirty (30) days after
receipt of written notice thereof; the nonbreaching party may terminate
immediately; provided that if, such default cannot practicably be cured within
such thirty (30) day period and is susceptible to a cure, then the defaulting
Party will not be considered in default if it commences to cure within the
initial thirty (30) day period and in good faith diligently and continuously
proceeds to cure the default.

 

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C.  
Bankruptcy and Similar Proceedings. The commencement of any involuntary
proceeding in bankruptcy or insolvency under federal or state law or the
appointment of a receiver or an assignee for the benefit of creditors for a
substantial portion of a Party’s assets which is not dismissed or terminated
within ninety (90) days after its initiation; or the commencement of any
voluntary proceeding in bankruptcy or insolvency under federal or state law
shall be an Event of Default.

Section 17 — Term and Termination

A.  
Term of Agreement. The initial term of this Agreement will commence upon the
Effective Date October 28, 2002 and will continue until September 30, 2005 (the
“Term”) unless terminated earlier pursuant to the provisions of this Agreement.
Thereafter, this Agreement will be renewed for additional one year terms unless
one Party gives the other Party at least one hundred eighty (180) days written
notice of intention to terminate prior to the end of the current term.

B.  
Termination Upon Event of Default. If either Party’s actions constitute an Event
of Default within the meaning of Section 16, then the other Party may, by giving
written notice of such default to such Party, terminate this Agreement as of the
date specified in such Event of Default notice of termination.

C.  
Termination by UPS. UPS may terminate this Agreement with or without cause by
giving APAC written notice at least one hundred and eighty (180) days prior the
effective termination date subject to the following provisions:

  (a)  
Termination for convenience could be executed by UPS no sooner than one (1) year
from the commencement of the Term.
    (b)  
New employees would be impacted immediately upon notification and all new hiring
stopped. Ramp down could be accomplished in sections, workgroups, etc. or on a
non-categorical basis. For example, PI ramped down in sections by workgroups,
i.e. damage notifiers first, then claims agents, etc.
    (c)  
In no event shall any ramp-down violate any state or federal employment laws or
cause the payment of any state or federally mandated penalties relating to the
termination of APAC personnel (e.g., WARN Act penalties).
    (d)  
APAC acknowledges and agrees that this may necessitate the need to have two
vendors working together in same site as one-vendor ramps down and another ramps
up.

 

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  (e)  
In addition, in the event of a Termination for any reason APAC agrees to pay UPS
or its designee an amount equal to all the following Entitlements (defined as
vacation, sick, optional days and holiday pay) for all CSR’s employed in the
Newport News, Virginia center who have been terminated by APAC on the date of
Termination and who have been hired on the date of Termination by UPS or its
designee. For purposes of this agreement accrual is defined in the examples that
follow:

  •  
Example 1: Employee A begins employment on October 4th of current year, they
will have accrued 11/12 of their vacation, optional, sick, and holiday
entitlement by September of the next year, i.e., if the vacation earned after
1 year would have been 2 weeks then the accrual would be defined as 11/12 of
2 weeks vacation.
    •  
Example 2: Employee B has been employed for 4 years and 10 months when vendors
change. Therefore, employee B has accrued 10/12 of their vacation that they
would be eligible upon their 5th year of employment, i.e. 10/12 of 3 weeks
vacation (15 paid days) or 12 accrued days of vacation.

D.  
Termination by APAC. APAC may terminate this Agreement by giving UPS written
notice at least twelve (12) months written notice prior the effective
termination date subject to the following provisions:
     
APAC will provide the Services pursuant to the terms provided in this Agreement
through the end of the notice period. UPS agrees to provide to APAC, prior the
last six (6) months of the notice period, a ramp-down plan to be executed during
the remaining six (6) months that enables UPS to effectively reasonably
transition volumes and the Services prior to the end of the notice period and
avoids the imposition of employment-related WARN Act and similar penalties.
  E.  
Termination for Changed Laws. Either party shall have the right to terminate
this Agreement, without liability to the other, in the event of judicial,
regulatory or legislative change rendering performance of this Agreement
impossible or illegal. Each party shall provide the other with written notice of
such termination as promptly as possible, but in no event less than sixty
(60) days prior to the termination date; provided that in such event, the
parties will use best efforts, within the parameters of the applicable laws.

 

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Section 18 — Post-Termination

A.  
Termination Assistance. Commencing upon any notice of termination by either
party pursuant to above Sections hereof or upon expiration of this Agreement,
APAC will provide to UPS or its designee any and all termination assistance
reasonably requested by UPS to allow the Services to continue without
interruption or adverse effect and to facilitate the orderly transfer of
responsibility for the Services to UPS or its designee (“Termination
Assistance”), APAC and UPS shall work together to develop any and all transition
plans, which may include ramp-downs by work group or sections. Should
termination be initiated by APAC, UPS acknowledges and agrees that APAC’s
requirement to provide Termination Assistance will be contingent upon UPS’s
payment for Services and for Termination Assistance prior to and during the
transition period. If and to the extent that such assistance is provided prior
to the termination date, APAC will provide termination assistance at the Base
Rate. If and to the extent that such assistance is provided after the
termination date or otherwise requires resources in addition to those resources
then being regularly utilized in the performance of the Services, UPS will pay
APAC for such assistance on a time and materials basis at negotiated rates
therefor or on any other mutually acceptable basis. The Termination Assistance
to be provided to UPS by APAC shall include, without limitation, the following:

  1.  
Continuing to perform, for a reasonable period following the termination date
not to exceed six (6) months without the mutual agreement of the parties, any or
all of the Services then being performed by APAC.
    2.  
Developing, with the assistance of UPS, a plan for the transition of operations
from APAC to UPS or its designee.
    3.  
Providing training for personnel of UPS and its designee in the performance of
the operations then being transitioned to UPS or its designee.
    4.  
Entering into licensing arrangements with UPS or its designee, for any
application software and processes (including all updates, enhancements,
improvements and modifications thereto) then being utilized by APAC in
performing the Services, together with such other operating Software as is
necessary to operate such application software and related documentation, data
base management systems, date and technical information. Any license granted to
UPS pursuant to this Section, at a minimum, (i) will contain terms and
conditions that are reasonably satisfactory to APAC; (ii) will contain license
fees agreed upon as reasonable by a mutually selected third party under
confidentiality restrictions reasonably satisfactory to APAC; (iii) will provide
to UPS the right to use the software to process UPS’s own internal work
(including work required to support the provision of this CSR product and
services to outsource companies); and (iv) will give UPS the right to sublicense
to third parties for the performance thereof so long as each third party having
access to the software provides to APAC written assurances in a form and
substance reasonably satisfactory to APAC, that such third party will maintain
at all times the confidentiality of the software and will not use the software
for any purpose other than the limited purpose of processing the internal work
of UPS. Notwithstanding anything herein to the contrary, APAC will be excused
from granting the above described licenses to UPS in the event that APAC
terminates this Agreement for cause as provided herein.

 

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  5.  
Making available to UPS or its designee, pursuant to mutually acceptable terms
and conditions, any equipment owned or leased by APAC that APAC is required to
provide under this Agreement. UPS or its designee may purchase any such
equipment owned by APAC at APAC’s then current book value and may assume APAC’s
rights and obligations with respect to any such equipment leased by APAC, but in
no event less than any remaining outstanding loan on the equipment.
    6.  
Making available to UPS or its designee, pursuant to mutually acceptable terms
and conditions, any third party services then being utilized by APAC in the
performance of the Services.

B.  
Post-Termination Confidentiality Assurances. Prior to providing any of the
foregoing termination assistance to UPS or its designee, APAC shall be entitled
to receive from any designee of UPS, in form and substance reasonably acceptable
to APAC, written assurances that (i) such designee will maintain at all times
the confidentiality of any APAC proprietary information, software or materials
disclosed or provided to, or learned by such designee in connection therewith,
and (ii) such designee will use such information, software or materials
exclusively for purposes for which UPS is authorized to use such information,
software or materials pursuant to this Agreement. This provision shall survive
termination or expiration of this Agreement.
  C.  
Post-Termination Invoice and Payment. Upon receipt of a notice of termination
specified in Section 17, APAC shall submit to UPS APAC’s invoice for amounts due
in accordance with Section 4 hereof within two (2) months of the effective date
of termination. Failure to submit such an invoice within the time allowed shall
relieve UPS from paying any amount beyond that which UPS may verify from its
records as due and payable and such determination shall be final. Payments of
all amounts due shall be effected in accordance with Section 4.

 

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Section 19 — Notices
All notices or requests required to be given under this Agreement and all other
communications related to this Agreement shall be in writing and shall be deemed
to have been duly given when personally delivered or sent by UPS Next Day Air
Letter, addressed as follows: If to UPS, United Parcel Service, 35 Glenlake
Parkway, NE, Suite 200 Atlanta, Georgia 30328, Attention: Betty Schmitz, with a
copy to: United Parcel Service, 55 Glenlake Pkwy NE, Atlanta, Georgia 30328
Attn: Legal Dept. and if to APAC, APAC Customer Service, Six Parkway North,
Deerfield, IL 60015 Attention: Dave LaBonte, Vice President, with a copy
addressed to the attention of General Counsel. Either party may change its
address, or the name or title of the individual to whom notices shall be
directed by written notice issued and delivered as set forth above.
Section 20 — General Provisions

A.  
Entire Agreement. This Agreement sets forth the entire understanding of the
parties hereto and supersedes all prior oral and written agreements between the
parties relative to the subject matter hereof and merges all prior and
contemporaneous discussions between them. Neither party shall be bound by any
condition, representation, warranty, covenant or provision other than as
expressly stated in or contemplated by this Agreement unless hereafter set forth
in a written instrument executed by such party. The parties to this Agreement
may, by mutual written consent executed by them, amend, modify or supplement
this Agreement.
  B.  
No Waiver. The terms, covenants, representations and warranties of this
Agreement may be waived only by a written instrument executed by the party
waiving compliance. The failure of either party at any time to require
performance of any provision hereof shall, in no manner, affect the right at a
later date to enforce the same. No waiver by either party of any breach of any
term, covenant, representation or warranty contained in this Agreement, whether
by conduct or otherwise, in any one or more instances, shall be deemed to be or
construed as a further or continuing waiver of any such breach or the breach of
any other term, covenant, representation or warranty of this Agreement.
  C.  
Assignment. This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns. The duties and
obligations under this Agreement may not be assigned or delegated by either
party without the written consent thereto of the other party, except that UPS
may assign this Agreement to one of its Affiliated Companies. APAC may not
assign any of its rights or delegate any of its duties pursuant to this
Agreement without the prior written consent of UPS and any attempted assignment
without such consent shall be void. Any assignment in contradiction of this
clause shall be void.

 

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D.  
Severability. In the event that any one or more of the provisions contained in
this agreement shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Agreement, but this agreement shall
be construed as if such invalid, illegal or unenforceable provision had never
been contained herein. Further, in the event that any provision of this
Agreement shall be held to be invalid, illegal or unenforceable by virtue of its
scope or period of time, but may be made enforceable by a limitation thereof,
such provision shall be deemed to be amended to the minimum extent necessary to
render it valid, legal and enforceable.
  E.  
Survival. Any terms hereunder that, by their very nature, would survive the
termination or expiration of this Agreement shall so survive.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first written above.

                      APAC CUSTOMER SERVICES, INC.       UNITED PARCEL SERVICE
OASIS SUPPLY CORPORATION    
 
                   
By:
  /s/ Theodore G. Schwartz
 
      By:   /s/ Betty Schmidt
 
   
 
                   
Its:
  C.E.O.
 
      Its:   V.P. Corporate Customer Service Centers
 
   

 

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