**Exhibit 10.114**

 

**VCampusProposal to Amer Technology Inc. for**

**Departmentof Veterans Affairs**

**VALearning University**

**Web-basedTraining Initiative**

 

**VALearning Online (VALO)**

**RequestforTask Order SOW Modification**

**ContractNumber**

**TPD-04-C-0013**

**FedSourceTask Order**

**SAN008387**

**One(1) Year Contract with Three (3) Renewal Options**

**March 11,2006— November 9, 2009**

 

**Date:March 7, 2006**

 

**VCampus proposes as per Attachment I for theone year with three renewal options for the continued support of VALO on-line training:**

 

**Period of Performan**ce

 
| Base Year            |   | 3/11/2006 -  3/10/2007 |
|----------------------|--------|------------------------|
| Option  Period One   |   | 3/11/2007 -  3/10/2008 |
| Option  Period Two   |   | 3/11/2008 -  3/10/2009 |
| Option  Period Three |   | 3/11/2009 -  11/9/2009 |

 

**Pricing**

 

This Task Order is submitted as a Firm Fixed Priced proposal. SeeAttachment I for details.

 

**Payment terms are as follows:**

 

Amer Technology, Inc. will pay to VCampus the full firm fixedprice amount for the base year of $1,481,480.17 within four (4) days ofAmer Technology receiving payment from the Government.

 

**Pricing Validity**

 

All prices, terms and conditions quoted herein are valid for thirty(30) days from the date of this proposal.

 

----

 
| FedSourceTask Order | **ATTACHMENT  I**                     | Period of Performance: |
|---------------------|---------------------------------------|------------------------|
|                | Marsh 11,  2005-November 9, 2009 |
| SAN08387            |

 
| **Period of Performance  3/11/2006 – 3/10/2007** | ** ** | ** **                                     | ** ** | ** **   | ** ** | ** **     | ** ** | ** **         | ** **       |
|-------------------------------------------------------|------------|------------------------------------------------|------------|--------------|------------|----------------|------------|--------------------|------------------|
| **ITEM #**                                            | ** ** | **DESCRIPTION**                                | ** ** | **QUANTITY** | ** ** | **UNIT PRICE** | ** ** | **EXTENDED PRICE** | ** **       |
| 2VCM00I                                               |       | Basic LMS  Set-Up (225,000)                    |       | **[*]**      | ** ** | **$**          | **[*]**    | ** **         | **$**            | **[*]** | ** ** |
| 2VCM002                                               |       | End User  licenses (25,000-49,999)             |       | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **       |
| N/A                                                   |       | Library  Licenses (30,000)                     |       | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **       |
| 5VCM00I                                               |       | Project  Manager                               | ** ** | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **       |
| 5VCM002                                               |       | Senior  Analyst                                | ** ** | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **       |
| 5VCM003                                               |       | Senior  Designer - Lead Instructional Designer | ** ** | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **       |
| 5VCM004                                               |       | Journeyman  Analyst - Instructional Designer   | ** ** | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **       |
| 5VCM00S                                               |       | Junior  Analyst                                | ** ** | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **       |
| 5VCM006                                               |       | Programmer                                     | ** ** | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **       |
| 5VCM007                                               |       | Instructor -  SME                              | ** ** | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **       |
| 5VCM008                                               |       | Graphics  Artist                               | ** ** | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **       |
| 5VCM009                                               |       | Technical  Editor                              | ** ** | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **       |
|                                                  |       |                                           | ** ** | ** **   | ** ** | ** **     | ** ** | ** **         | ** **       |
| TOTAL                                                 |       |                                           | ** ** | ** **   | ** ** | ** **     | ** ** | $                  | **1,481,480.17** | ** ** |
|                                                       |            |                                                |            |              |            |                |            |                    |                  |  |  |

 
| **Period of Performance:  3/11/2007-3/10/2008** | ** ** | ** **                                     |   | ** **   | ** ** | ** **     | ** ** | ** **         | ** **   |
|-------------------------------------------------|------------|------------------------------------------------|--------|--------------|------------|----------------|------------|--------------------|--------------|
| **ITEMS**                                       | ** ** | **DESCRIPTION**                                |   | **QUANTITY** | ** ** | **UNIT PRICE** | ** ** | **EXTENDED PRICE** | ** **   |
| 2VCM00I                                         |       | Basic LMS  Set-Up (225,000)                    |   | **[*]**      | ** ** | **$**          | **[*]**    | ** **         | **$**        | **[*]** | ** ** |
| 2VCM002                                         |       | End User  Licenses (25,000-49,999)             |   | **[*]**      |       | **[*]**        |       | **[*]**            |         |
| N/A                                             |       | Library licenses  (30,000)                     |   | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **   |
| 5VCM00I                                         |       | Project  Manager                               |   | **[*]**      |       | **[*]**        |       | **[*]**            |         |
| 5VCM002                                         |       | Senior  Analyst                                |   | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **   |
| 5VCM003                                         |       | Senior  Designer - Lead Instructional Designer |   | **[*]**      |       | **[*]**        |       | **[*]**            |         |
| 5VCM004                                         |       | Journeyman  Analyst - Instructional Designer   |   | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **   |
| 5VCM00S                                         |       | Junior  Analyst                                |   | **[*]**      |       | **[*]**        |       | **[*]**            |         |
| 5VCM006                                         |       | Programmer                                     |   | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **   |
| 5VCM007                                         |       | Instructor -  SME                              |   | **[*]**      |       | **[*]**        |       | **[*]**            |         |
| 5VCM008                                         |       | Graphics  Artist                               |   | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **   |
| 5VCM009                                         |       | Technical  Editor                              |   | **[*]**      |       | **[*]**        |       | **[*]**            |         |
| ** **                                      | ** ** | ** **                                     |   | ** **   | ** ** | ** **     | ** ** | ** **         | ** **   |
| TOTAL                                           |       |                                           |   |         |       |           |       | $                  | 1,510,694.33 |   |
|                                                 |            |                                                |        |              |            |                |            |                    |              |  |  |

 
| **Period of Performance:  3/11/2008 -3/10/2009** | ** ** | ** **                                    | ** ** | ** **   | ** ** | ** **     | ** ** | ** **         | ** **   |
|--------------------------------------------------|------------|-----------------------------------------------|------------|--------------|------------|----------------|------------|--------------------|--------------|
| **ITEMS**                                        | ** ** | **DESCRIPTION**                               | ** ** | **QUANTITY** | ** ** | **UNIT PRICE** | ** ** | **EXTENDED PRICE** | ** **   |
| 2VCM00I                                          |       | Basic LMS  Set-Up (225,000)                   |       | **[*]**      | ** ** | **$**          | **[*]**    | ** **         | **$**        | **[*]** | ** ** |
| 2VCM002                                          |       | End User  Licenses (25,000-49,999)            |       | **[*]**      |       | **[*]**        |       | **[*]**            |         |
| N/A                                              |       | Library  Licenses (30,000)                    |       | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **   |
| 5VCM00I                                          |       | Project  Manager                              |       | **[*]**      |       | **[*]**        |       | **[*]**            |         |
| 5VCM002                                          |       | Senior  Analyst                               |       | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **   |
| 5VCM003                                          |       | Senior  Designer- Lead Instructional Designer |       | **[*]**      |       | **[*]**        |       | **[*]**            |         |
| 5VCM004                                          |       | Journeyman  .Analyst - Instructional Designer |       | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **   |
| 5VCM00S                                          |       | Junior  Analyst                               |       | **[*]**      |       | **[*]**        |       | **[*]**            |         |
| 5VCM006                                          |       | Programmer                                    |       | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **   |
| 5VCM007                                          |       | Instructor -  SME                             |       | **[*]**      |       | **[*]**        |       | **[*]**            |         |
| 5VCM008                                          |       | Graphics  Artist                              |       | **[*]**      | ** ** | **[*]**        | ** ** | **[*]**            | ** **   |
| 5VCM009                                          |       | Technical  Editor                             |       | **[*]**      |       | **[*]**        |       | **[*]**            |         |
| ** **                                       | ** ** | ** **                                    |       | ** **   | ** ** | ** **     | ** ** | ** **         | ** **   |
| TOTAL                                            |       |                                          |       |         |       |           |       | $                  | 1,540,770.09 |   |
|                                                  |            |                                               |            |              |            |                |            |                    |              |  |  |

 
| **Period of Performance:  3/11/2009 - 11/9/2009** | ** ** | ** **                                     | ** ** | ** **   | ** ** | ** **     | ** **   | ** **         | ** **   |
|---------------------------------------------------|------------|------------------------------------------------|------------|--------------|------------|----------------|--------------|--------------------|--------------|
| **ITEMS**                                         | ** ** | **DESCRIPTION**                                | ** ** | **QUANTITY** | ** ** | **UNIT PRICE** | ** **   | **EXTENDED PRICE** | ** **   |
| 2VCM00I                                           |       | Basic LMS  Set-Up (225,000)                    |       | **[*]**      | ** ** | **$**          | **[*]**      | ** **         | **$**        | **[*]** | ** ** |
| 2VCM002                                           |       | End User  Licenses (25,000-49,999)             |       | **[*]**      |       | **[*]**        |         | **[*]**            |         |
| N/A                                               |       | Library  Licenses (30,000)                     |       | **[*]**      | ** ** | **[*]**        | ** **   | **[*]**            | ** **   |
| 5VCM00I                                           |       | Project  Manager                               |       | **[*]**      |       | **[*]**        |         | **[*]**            |         |
| 5VCM002                                           |       | Senior  Analyst                                |       | **[*]**      | ** ** | **[*]**        | ** **   | **[*]**            | ** **   |
| 5VCM003                                           |       | Senior  Designer - Lead Instructional Designer |       | **[*]**      |       | **[*]**        |         | **[*]**            |         |
| 5VCM004                                           |       | Journeyman  Analyst - Instructional Designer   |       | **[*]**      | ** ** | **[*]**        | ** **   | **[*]**            | ** **   |
| 5VCM00S                                           |       | Junior  Analyst                                |       | **[*]**      |       | **[*]**        |         | **[*]**            |         |
| 5VCM006                                           |       | Programmer                                     |       | **[*]**      | ** ** | **[*]**        | ** **   | **[*]**            | ** **   |
| 5VCM007                                           |       | Instructor -  SME                              |       | **[*]**      |       | **[*]**        |         | **[*]**            |         |
| 5VCM008                                           |       | Graphics  Artist                               |       | **[*]**      | ** ** | **[*]**        | ** **   | **[*]**            | ** **   |
| 5VCM009                                           |       | Technical  Editor                              |       | **[*]**      |       | **[*]**        |         | **[*]**            |         |
| ** **                                        | ** ** | ** **                                     |       | ** **   | ** ** | ** **     | ** **   | ** **         | ** **   |
| TOTAL                                             |       |                                           |       |         |       |           |         | $                  | 1,047,881.97 |   |
|                                              |       |                                           |       |         |       |           |         |               |         |   |
| TOTAL TASK  ORDER VALUE                           |       |                                           |       |         |       | $              | 5,580,826.56 |               |
|                                                   |            |                                                |            |              |            |                |              |                    |              |  |  |  |  |

 

----

**[*] Confidential Treatment Requested for Portions of this Agreement**

 

----

 

**AmerTechnology, Inc.**

**Task OrderModification Award Notice**

**ToV-Campus**

**ModificationAward Date 3/13/06**

** **
| **Task Order Award Notice****Contract Number TPD-04-C-0013**  Customer POC Information  Department of Veterans Affairs  810 Vermont Ave. N. W.  Washington, DC 20420  US  Attn: Seldon Todd  Phone: (202) 501-3442  Fax: (202) 501-3462  E-mail address: |   | Earliest Start Date: 3/11/06  Task Order Number: S**AN008387-Mod 002**  FedSource RFP: Q007041-SAN  Site Location  Department of Veterans Affairs  810 Vermont Ave. N. W.  Washington, DC 20420  US  Attn: Seldon Todd  Phone:(202) 501-3442  Fax: (202) 501-3462 |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 
| FASTRAC Modification 002:       |   |                                        |
|---------------------------------|--------|---------------------------------------------|
| Award Period: 3/11/06 - 3/10/07 |   | Project Title: VALO SUPPORT - Renewal  Year |

 
| **Item**    | ** ** | **Description**                                    | ** **       | **Qty**    | ** ** | **Rate**   | ** ** | **Total**  | ** ** |
|-------------|------------|----------------------------------------------------|------------------|------------|------------|------------|------------|------------|------------|
| **2VCM001** | ** ** | **Basic  LMS Set-Up (225,000)**                    | ** **       | **[*]**    | ** ** | ** ** | ** ** | ** ** | ** ** |
| **2VCM002** | ** ** | **End User  Licenses (25,000-49,999)**             | ** **       | **[*]**    | ** ** | **[*]**    | ** ** | **[*]**    | ** ** |
| **N/A**     | ** ** | **Library  Licenses (30,000)**                     | ** **       | **[*]**    | ** ** | **[*]**    | ** ** | **[*]**    | ** ** |
| **5VCM001** | ** ** | **Project  Manager**                               | ** **       | **[*]**    | ** ** | **[*]**    | ** ** | **[*]**    | ** ** |
| **5VCM002** | ** ** | **Senior  Analyst**                                | ** **       | **[*]**    | ** ** | **[*]**    | ** ** | **[*]**    | ** ** |
| **5VCM003** | ** ** | **Senior  Designer - Lead Instructional Designer** | ** **       | **[*]**    | ** ** | **[*]**    | ** ** | **[*]**    | ** ** |
| **5VCM004** | ** ** | **Journeyman  Analyst -Instructional Designer**    | ** **       | **[*]**    | ** ** | **[*]**    | ** ** | **[*]**    | ** ** |
| **5VCM005** | ** ** | **JuniorAnalyst**                                  | ** **       | **[*]**    | ** ** | **[*]**    | ** ** | **[*]**    | ** ** |
| **5VCM006** | ** ** | **Programmer**                                     | ** **       | **[*]**    | ** ** | **[*]**    | ** ** | **[*]**    | ** ** |
| **5VCM007** | ** ** | **Instructor  - SME**                              | ** **       | **[*]**    | ** ** | **[*]**    | ** ** | **[*]**    | ** ** |
| **5VCM008** | ** ** | **Graphics  Artist**                               | ** **       | **[*]**    | ** ** | **[*]**    | ** ** | **[*]**    | ** ** |
| **5VCM009** | ** ** | **Technical  Editor**                              | ** **       | **[*]**    | ** ** | **[*]**    | ** ** | **[*]**    | ** ** |
| **Total**   | ** ** | **$**                                              | **1,481,480.17** | ** ** |
|             |            |                                                    |                  |            |            |            |            |            |            |  |

 

**Designatedbilling items are no to be exceeded without Task Order Modification**

 

----

**[*] ****Confidential Treatment Requested for Portions of thisAgreement**

 

----

 

**Block 14 Continuation**

 

**This modification is to renew the use of the FasTrac program for theperiod of 3/11/2006 through 3/10/07. This effort will provide 30,000 employees access to SkillSoftComplete Combined Library*,*theEnvironmental Safety and Health and Legal Compliance Library and support to theLibrary Management System. The support consists of help desk support and thecreation of customized ad hoc reports throughout the period of performance. Thethree line items were broken down into multiple labor categories, withpercentages allocated to each of the services line items (help desk andreports). See PNM for details. This task order was awarded under the FasTracprogram, which was completed and awarded to Amer Technology.**

 

This Task Order Modification Award Notice is issued pursuant to theSubcontracting Agreement between Amer Technology, Inc. and Subcontractor

 

Jack Jensen

Vice-President, Instructional Systems

5717 Northwest Parkway, Suite 103

San Antonio, TX 78249

Tel (210) 256-7070 FAX (210) 256-7878

 

2

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**SUBCONTRACT AGREEMENT**

 
| EFFECTIVE DATE:         |   | February 11, 2005                                                                                       |
|-------------------------|--------|--------------------------------------------------------------------------------------------------------------|
|                    |   |                                                                                                         |
| CONTRACT TYPE:          |   | Time and Materials  Labor Hours  Firm Fixed Price  Indefinite Delivery – Indefinite Quantity Task Order |
|                    |   |                                                                                                         |
| CONTRACT VALUE:         |   | Contract Price to be established by  Task Orders issued hereunder                                            |
|                    |   |                                                                                                         |
| CONTRACTOR CONTACTS:    |   | Contracts:                                                                                                   |   | Jack Jensen, Vice President  Instructional Systems  Amer Technology, Inc |
|                    |   |                                                                                                         |   |   |
|                    |   | Technical:                                                                                                   |   | Jack Jensen, Vice President  Instructional Systems  Amer Technology, Inc. |
|                    |   |                                                                                                         |   |   |
|                    |   | Contracts:                                                                                                   |   | Ronald E. Freedman  Sr. Vice President, Sales and Marketing  VCampus Corporation |
|                    |   |                                                                                                         |   |   |
| SUBCONTRACTOR CONTACTS: |   | Technical:                                                                                                   |   | Joy Gilstrap  Manager, Sales Support  VCampus Corporation |

 

 
| APPROVAL SIGNATURES:                           |   |                       |   |
|------------------------------------------------|--------|----------------------------|--------|
|                                           |   |                       |   |
| VCampus Corporation                            |   | Amer Technology, Inc. |   |
|                                           |   |                       |   |
|                                           |   |                       |   |
| /s/ Christopher L. Nelson                      |   |                       |   |
| Signature                                      |   | Signature                  |   |
|                                           |   |                       |   |
| Christopher L. Nelson, Chief Financial Officer |   |                       |   |
| Name and Title                                 |   | Name & Title      |   |
|                                           |   |                       |   |
| 3/1/05                                         |   |                       |   |
| Date                                           |   | Date                       |   |

 

1

----

 

**TABLE OFCONTENTS**

 
| **DESCRIPTION**                               | ** ** | **PAGE** |
|-----------------------------------------------|------------|----------|
|                                          |       |     |
| SUBCONTRACT COVER PAGE                        |       | 1        |
|                                          |       |     |
| TABLE OF CONTENTS                             |       | 2        |
|                                          |       |     |
| SECTION B. SERVICES                      |       | 3        |
|                                          |       |     |
| SECTION C. DESCRIPTION                   |       | 5        |
|                                          |       |     |
| SECTION D. PACKAGING AND MARKING         |       | 5        |
|                                          |       |     |
| SECTION E. INSPECTION AND ACCEPTANCE     |       | 5        |
|                                          |       |     |
| SECTION F. DELIVERIES OR PERFORMANCE     |       | 6        |
|                                          |       |     |
| SECTION G. CONTRACT ADMINISTRATION DATA  |       | 7        |
|                                          |       |     |
| SECTION H. SPECIAL CONTRACT REQUIREMENTS |       | 12       |
|                                          |       |     |
| SECTION I. CONTRACT CLAUSES              |       | 18       |

 

2

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**SECTION B -  SERVICES**

 

**B.1****                               SCOPEOF WORK**

 

(a)   TheSubcontractor shall furnish the necessary services (“Services”) of skilledprofessional, technical personnel or firm fixed price deliverables (“Deliverables”)_tofulfill the requirements of the Task Orders (TO) in support of the primeStatement of Work entitled “TBD”. The personnel supporting this effort mustmeet the requirements of the attached Labor Category Descriptions.

 

(b)  Deliverableswill be in accordance with the Task Orders dated TBD. In the event any softwarelicenses are specified as a Deliverable in a TO, each software license will besubject to the software developer’s applicable license terms and conditions. Inthe case of Subcontractor’s proprietary software, the terms and conditionsgoverning such software are contained in Subcontractor’s GSA Schedule GS-35F-0069M,which is hereby incorporated by this reference. In no instance will a softwarelicense be deemed a Service for the purposes of this Agreement or any terms orconditions incorporated herein.

 

**B.2.**         **LABOR HOURS (T&M)**

 

The labor hours will be specified in each Task Order (TO). Each personwill be assigned a labor category. Only those categories specifically approvedfor a TO may be charged. The Prime Program Manager must approve every personcharging to a TO in advance, in writing. The selection of individuals tosupport this program was based on the personnel having the critical skillsnecessary to provide continuity of services for the FasTrac requirements. Nosubstitution or replacement of personnel will be permitted without writtenconsent from the Prime Contractor, which shall not be unreasonably withheld.

 

(a)   Individualsor groups of individuals assigned under this contract **will not**divulge or communicate in any wayanything that is considered to be proprietary, financial, confidential and/orprivileged information by Prime Contractor (i.e. wages, hours, manning,progress) to third parties to include government representatives without theexpress written consent of Prime Program Manager.

 

(b)  Theparties anticipate that under this Agreement it may be necessary for eitherparty to transfer to the other information of a proprietary nature. Proprietaryinformation shall be clearly identified by the disclosing party at the time ofdisclosure by (i) appropriate stamp or markings on the document exchanged;or (ii) written notice, with attached listings of all material, copies ofall documents, and complete summaries of all oral disclosures (under priorassertion of the proprietary nature of the same) to which each notice relates,delivered within two (2) weeks of the disclosure to the other party.

 

(c)   Eachof the parties agrees that it will use the same reasonable efforts to protectsuch information as are used to protect its own proprietary information. Disclosuresof such information shall be restricted to those individuals who are directlyparticipating in the proposal, contract and subcontract efforts identified inArticles 1, 2, 3, and 4 hereof.

 

(d)  Neitherparty shall make any reproduction, disclosure, or use of such proprietaryinformation except as follows:

 

3

----

 

(1)           Such information furnished by the Subcontractor may beused, reproduced and/or disclosed by Contractor in performing its obligationsunder this Agreement.

 

(2)           Such information furnished by Contractor may be used,reproduced and/or disclosed by the Subcontractor in performing its obligationsunder this Agreement.

 

(3)           Such information may be used, reproduced and/or disclosedfor other purposes only in accordance with prior written authorization receivedfrom the disclosing party.

 

(e)   Thelimitations on reproduction, disclosure, or use of proprietary informationshall not apply to, and neither party shall be liable for reproduction,disclosure, or use of proprietary information with respect to which any of thefollowing conditions exist:

 

(1)           If, prior to the receipt thereof under this Agreement, ithas been developed or learned independently by the party receiving it, or hasbeen lawfully received from other sources, including the Government, providedsuch other source did not receive it due to a breach of this Agreement or anyother agreement.

 

(2)           If, subsequent to the receipt thereof under thisAgreement, (i) it is published by the party furnishing it or is disclosed,by the party furnishing it to others, including the Government, withoutrestriction; or (ii) it has been lawfully obtained, by the party receivingit, from other sources including the Government, provided such other source didnot receive it due to a breach of this or any other agreement; or (iii) suchinformation otherwise comes within the public knowledge or becomes generallyknown to the public.

 

(3)           If any part of the proprietary information has been orhereafter shall be disclosed in a United States patent issued to the partyfurnishing the proprietary information hereunder, the limitations on suchproprietary information as is disclosed in the patent shall be only thatafforded by the United States Patent Laws after the issuance of said patent.

 

(4)           If any part of the proprietary information is required bylaw to be disclosed. In the event that information is required to be disclosedpursuant to subsection 4, the party required to make disclosure shallnotify the other to allow that party to assert whatever exclusions orexemptions may be available to it under such law or regulation.

 

(f)   Neitherthe execution and delivery of this Agreement, nor the furnishing of anyproprietary information by either party shall be construed as granting to theother party either expressly, by implication, estoppel, or otherwise, anylicense under any invention or patent now or hereafter owned or controlled bythe party furnishing the same.

 

(g)  Thiscontract supersedes all written, express, verbal and nonverbal correspondencethat may or may not have been communicated in the past.

 

(h)  Effortexpended in fulfilling each TO shall only include effort in direct support ofany resultant contract and shall not include effort expended on such things aslocal travel to and from an employee’s usual work location, uncompensatedeffort while on travel status, truncated lunch periods, un-approved work(actual or inferred) at the employee’s residence or other non-work locations,or other effort which does not have a specific and direct contribution to tasksdescribed herein.

 

**B.3          POINTS OF CONTACT**

 

All communication shall be between Subcontractor and Prime Contractor.The subcontractor is not authorized to send any correspondence directly to theGovernment Contracting Officer unless communication is initiated by theGovernment Contracting Officer.

 

4

----

 

PRIME CONTRACTOR:

 

Amer Technology, Inc.

Attn: Balwinder Dhillon

6502 Bandera Rd, Suite 105

San Antonio, TX 78238

 

SUBCONTRACTOR:

 

VCampus Corporation

Attn: Joy Gilstrap

1850 Centennial Park Drive, Suite 200

Reston, VA 20191

 

**SECTION C-** **DESCRIPTION**

 

**C.1          DESCRIPTION**

 

The Services and Deliverables set forth in Section B shall complywith the following documents:

 

a.             TaskOrder (TO)

b.            FasTracScope of Work/Performance Work Statement

c.             PrimeContract

d.            ContractSecurity Classification Specification (DD254*),*if applicable

e.             ContractData Requirements List, if applicable

 

**SECTION D -  PACKAGING AND MARKING**

 

**D.1****                             PAYMENTOF POSTAGE AND FEES**

 

The Subcontractor shall pay all postage and fees related to submittinginformation and materials to the Government unless mutually agreeable alternatearrangements are made between the Prime Contractor and the Subcontractor.

 

**D.2****                             PREPARATIONFOR DELIVERY**

 

All items shall be packaged in accordance with normal commercialpractice.

 

**D.3****                             MARKINGOF SHIPMENTS**

 

To facilitate identification, the Subcontractor making shipments to thePrime Contractor or to the Government shall mark each piece, bundle, orcontainer (inside and outside) with the Government contract number, the taskorder number, and, in addition, mark all shipments in accordance with normalcommercial practice.

 

5

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**SECTION E -  INSPECTION AND ACCEPTANCE**

 

**E.1****                               REFERENCEDCLAUSES**

 

The following contract clause pertinent to this section is herebyincorporated by reference:

 
| **FAR 52.246-4** | ** ** | **INSPECTION OF SERVICES–FIXED-PRICE (AUG 1996)** |
|------------------|------------|--------------------------------------------------------|
| **FAR 52.246-6** | ** ** | **INSPECTION - TIME-AND-MATERIAL AND LABOR-HOUR**      |
|             |       | **(MAY 2001)**                                    |

 

**E.2****                               NOTICE:MATERIAL AND WORKMANSHIP**

 

All material incorporated in the work shall be new and the work shallbe performed in a skillful and workmanlike efficient manner. Both materials andworkmanship shall be subject to the inspection of the Prime Program Manager ortheir duly authorized representative who may require the Subcontractor tocorrect defective workmanship or materials.

 

**E.3****                               INSPECTIONAND ACCEPTANCE AT DESTINATION**

 

The Government or the Prime Program Manager will perform inspection andacceptance at destination. QA performance standards will be specified for eachtask order and be dependent upon the complexity of the task to be performed.

 

The Prime Contractor will provide written notice to the Subcontractorof deficiencies or necessary corrections to Deliverables within 30 calendardays of receipt of such deliverable. This notice will state the action thePrime Contractor requires of the Subcontractor in accordance with provisions of52.246-20, Warranty of Services.

 

**E.4****                               ACCEPTANCEREVIEW AND QUALITY**

 

The Prime Contractor will conduct a review of the contract Deliverablesfor completeness, correctness, and compliance with SOW requirements.

 

**E.5****                               QUALITYCONTROL**

 

The Subcontractor is required to****maintain a system of quality control commensurate with thetask order requirements. At a minimum, historical and in process workloadssegregated by task order and general task category is required. . Theperformance standards for each task order will be specified in the task orderrequest. The Subcontractor is required to immediately notify the PrimeContractor of problems or situations that could negatively impact compliancewith the provisions of the contract, and to inform the Prime Contractor of theplan the Subcontractor will implement to resolve problems.

 

**SECTION F -  DELIVERIES OR PERFORMANCE**

 

**F.1****                               REFERENCEDCLAUSES**

 
| **FAR  52.242-15** | ** ** | **Stop-Work  Order (AUG 1989)**    |
|--------------------|------------|------------------------------------|
| **FAR  52.247-34** | ** ** | **F.O.B.  Destination (NOV 1991)** |

 

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**F.2****                               PERIODOF PERFORMANCE**

 

This agreement shall be in place: **Base Year**2/11/05-  2/10/06

 

Should the Government exercise options, this agreement will extend forthe following periods:

 

**Option Year 1      **2/11/06-  2/10/07

**Option Year 2      **2/11/07-  2/10/08

**Option Year 3      **2/11/08-  11/9/08

 

**F.3****                               PLACEOF PERFORMANCE**

 

The place of performance shall be specified in each task order.

 

**SECTION G- CONTRACT ADMINISTRATION DATA**

 

**G.1****                             ACCOUNTINGAND APPROPRIATION DATA**

 

Accounting and appropriation data will be provided in each TO.

 

**G.2****                             FACILITIES/COMPUTERCOSTS**

 

The Subcontractor shall not direct charge for facilities cost andcomputer cost. In the event that travel or material costs are required tosupport an effort, it will be identified in the TO. Any ODC must be part of theTO.

 

**G.3****                             NOTICEOF TAXATION**

 

The Subcontractor shall provide the Prime Contractor with writtennotice of any proposed tax assessments, exemptions, exclusions or refunds,which would increase or decrease costs or liabilities to the subcontractorand/or Prime Contractor. The notice shall be submitted to Prime Contractor insufficient time to provide the Government a meaningful opportunity to assertits immunity, participate in negotiations or litigation with the taxingauthority concerning the applicability of the tax, and/or adjust the parties’liability for costs according to the increase or decrease in tax.

 

**G.4****                             SUBCONTRACTORLIABILITY FOR STATE AND LOCAL TAXES**

 

Generally, the Subcontractor is liable for payment of state or localtaxes on this subcontract to the same extent that it would be liable for suchtaxes on a contract with a non-government entity. Although it may be useful forthe Subcontractor to inform the taxing authorities that Prime Contractor’scustomer, FedSource San Antonio, is a federal government agency, this factalone does not in and of itself create a tax exemption for the subcontractor.While some transactions undertaken by the Subcontractor pursuant to thissubcontract may be exempt from a state or local tax, it is the Subcontractor’sresponsibility to identify such exemption under the applicable statute, and toresolve the applicability of such with state or local taxing authorities.

 

**G.5****                             TASKPROPOSAL REQUEST**

 

a.     The following types of taskorders may be issued:

 

1.             **Fixed-Price:**This is a task for which there are reasonablydefinite requirements, and for which there is one or more tangibleDeliverables.

 

2.             **Time-and-Materials:** This is a task thataddresses a requirement where it is not 

 

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possible to define the workspecifically enough to permit the development of a firm price estimate. The endproduct may be either services to perform specified types of work or theproduction of piecework, such as training manuals. This type of task order willbe issued with a not-to-exceed ceiling price.

 

3.             **Labor-Hours:**This is a task that addresses a requirementwhere it is not possible to define the work specifically enough to permit thedevelopment of a firm price estimate. No materials are necessary in theperformance of the work. This type of task order will be issued with anot-to-exceed ceiling price.

 

b. For time-and-materials task orders, the Prime Program Manager willnegotiate a finalized proposal, delivery schedule, performance metrics andstandards, specifications, and issue the task order. The Subcontractor may notexceed the monetary limitation outlined in the task order without priorapproval of the Prime Program Manager.

 

c. In the event the task order calls for inclusion of ancillary costssuch as equipment acquisition, computer time, software, or continuing travel(other than a single trip), the Subcontractor shall include these costs in thetask proposal. If a task order will require delivery of any materials orsupplies, the Government will include FAR provisions 52.225-2 and 52.225-4**in the task proposal request, as necessary.

 

**G.6****                   TASK ORDERPROPOSAL**

 

The task proposal request doesn’t commit the Prime Contractor to payany costs incurred in the submission of any proposal, nor does it commit theGovernment to issue a task order for such services.

 

**G.7****                   TASK ORDERPROCESS**

 

**Time and Material RFP**(Category 5)**-** Typically FedSourcerequires response within three business days. In order to meet the shortturnaround:

 

•   Qualify vendor(s) based uponfactors such as:

i.                  Suggestedsource

ii.               Technicalexpertise

iii.            Pastperformance

iv.           Location

v.              SecurityClearance

vi.           Price

•   Forward RFP to qualifiedvendor(s) within one business day.

•   Mini-proposal due to PrimeProgram Manager within one business day.

•   Evaluate proposal(s) on thefactors such as:

i.                  TechnicalApproach/best industry practices

ii.               Pastperformance

iii.            Proposedpersonnel

iv.           Price

v.              Otherfactors included, but not limited to, estimated level of effort and 

 

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period of performance

 

•                          QA forAQL adherences in accordance with our QA plan

•                          Selectthe successful vendor

•                          Submitsuccessful proposal to FedSource within three days after RFP release

•                          Conductnegotiations as needed

•                          If awardis made, Prime Program Manager will notify winning contractor via email withinone business day after award is received.

•                          Withinone business day of receiving award, Subcontractor must respond via email, withthe understanding to proceed.

 

**Firm Fixed Price (Category 1 to 4):**Thefollowing procedures shall be followed in initiating tasks under thisSubcontract for pre-priced requirements.

 

•              Chose theappropriate vendor, based on factors such as:

i.                  Suggestedsource

ii.               Technicalexpertise

iii.            Pastperformance

iv.           Location

v.              SecurityClearance

vi.           Price

•              Complete quote withparticular focus on quantity

•              Return to FedSourcewithin 24 hours of RFP release

•              If award is made,Prime Program Manager will notify winning contractor via email within onebusiness day after award is received.

•              Within one businessday of receiving award, Subcontractor must respond via email, with theunderstanding to proceed.

 

**G.8****                   INVOICING**

 

The invoice, with appropriate backup documentation (i.e., time sheets),shall be submitted in an Excel, Access, or compatible format to the PrimeContractor via the Internet or in diskette form via FedEx at Subcontractor’sexpense. Supporting documentation shall be sent electronically if possible. Ifthe electronic invoice is sent via diskette, the diskette shall be sent to thefollowing address:

 

Amer Technology

6502 Bandera Rd, Suite 105

San Antonio, TX 78238

 

The Subcontractor shall render monthly invoices, including backupdocuments, in arrears by the 5th calendar day of the following monthfor Services and Deliverables received in the prior month (e.g., October 1—31shall be billed by November 5th).

 

Prime Contractor shall submit an accurate invoice (reflecting allServices and Deliverables timely invoiced by Subcontractor) to the Governmentby the 12th of each month (as specified in performance workstatement).

 

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A “late” invoice is defined as a valid invoice that the Contractorsubmits after the 5th day of the month, or the next business day ifthe 5th calendar day is on a weekend or holiday, for the previousmonthly period of service. “Late” subcontractor invoices will be included inthe following month’s invoice to the government (e.g. an invoice received fromthe subcontractor on 6 November for services provided October 1-31will be included in the prime contractor’s invoice to the government submittedby the 12th of December).

 

a. **Labor-Hour Task Order** -  Detailed costs shall be provided in thefollowing:

 

i.                  Forlabor hours, labor expended for each skill level. The amount invoiced shallinclude labor charges for actual hours worked and other actual expenses basedupon contract rates. Copies of timesheets shall be included.

ii.               Totallabor charges

iii.            Totalinvoice amount

 

b.**Time-and-Materials Task Order -** Detailed costs shall be provided in thefollowing:

 

i.                  Fortime-and-materials tasks, labor expended for each skill level. The amountinvoiced shall include labor charges for actual hours worked and other actualexpenses based upon contract rates. Copies of timesheets shall be included.

ii.               Totallabor charges

iii.            Traveland per diem charges

iv.           Totalother direct costs

v.              Totalinvoice amount

 

NOTE: For reimbursable charges such as equipment, travel, per diem andother direct costs, invoices shall reflect the Subcontractor’s actual expensefor the item. Receipts must accompany invoices for reimbursable charges.Receipts for travel and per diem will be submitted as required by the FederalTravel Regulations.

 

c. **Fixed-Price Task Order -** Payment requests will be based on the payment schedule shownin the task order.

 

The Subcontractor agrees to include the following information on eachinvoice, as well as the information detailed above on labor-hour andtime-and-materials task orders:

 

i.                      Nameand address of the Subcontractor

ii.                   Invoicedate and number

iii.                Subcontractnumber and number for each Task Order (identifying the agency customer)

a.                   Periodof performance

iv.               Description,quantity, unit of measure, unit price, and extended price of supplies deliveredor services performed

v.                  Shippingand payment terms

 

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vi.               Nameand address of Subcontractor official to whom payment is to be sent (must bethe same as that in the contract or in a proper notice of assignment)

vii.            Name(where practicable), title, phone number, and mailing address of person to benotified in the event of a defective invoice

viii.         Othersubstantiating documentation or information as required by the Subcontract (forexample, time cards for labor-hours or time-and-material task orders)

 

All invoices shall be sent to the Prime Contractor with separate pages identifiedfor each customer agency with its agency code and task order number andappropriate charges. All billing issues shall be handled and resolved betweenthe Subcontractor and the Prime Contractor’s representative. The Subcontractorshall direct all questions and will use its reasonable best efforts to resolveall issues concerning invoices with the Prime Contractor and **not**the Government. Subcontractor shallnot engage in any billing discussion with a customer agency unless: a) thecustomer agency initiates the discussion, b) Prime Contractor has authorizedthe discussion, or c) Prime Contractor has breached a provision of this Agreement.

 

Each TO may have additional invoicing instructions.

 

Questions regarding payment shall be directed to (TBD).

 

Payment to Subcontractor will be made within four working days afterPrime Contractor receives payment from FedSource.

 

**G.9****                   PAYMENT**

 

1.             Payment of invoices will be made basedon the following:

 

a.              Negotiatedmonthly payment schedule

b.             Levelof effort

c.              Fixed-pricein accordance with the payment schedule for Deliverables in the individualtask order

 

2.             Ifsupplies or services are rejected for failure to conform to the technicalrequirements of the subcontract, or any other contractually legitimate reason,the Subcontractor will be paid an amount indicated by the payment calculationassociated with the acceptable quality performance standards indicated in thetask order or an amount negotiated by the Prime Contractor.

 

3.                **Reimbursement for travel expenses:**

 

a.              Subcontractorwill be reimbursed for travel and per diem expenses as specifically authorizedin a task order. Charges cannot exceed those stipulated in the Federal TravelRegulations unless documented by conditions listed in FAR 31.205-46, TravelCosts.

b.             Limitson travel rates for food and lodging are determined in accordance with FederalTravel Regulations.

 

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c.              Labor hour payments will be made foractual authorized travel time in support of approved task orders using the samecriteria as for Government personnel traveling under the same circumstances.The Subcontractor is responsible for ensuring that travel time outside ofnormal work hours is kept to a minimum. Upon request, the Subcontractor shallfurnish schedules and mode of transportation to the Government.

 

**G.10       PR****ICINGOF ADJUSTMENTS**

 

When costs are a factor in any determination of a contract priceadjustment pursuant to FAR  52.243-1, Changes - Fixed Price, and52.243-3, Changes – Time-and-Materials or Labor-Hours, such costs shall be inaccordance with the contract cost principles and procedures in Part 31 of theFederal Acquisition Regulation (48 CFR 31) in effect on the date of thesubcontract award.

 

**G.11****                      WITHHOLDING**

 

In accordance with 52.232-7, Payments under Time-and-Materials andLabor-Hour Contracts, the Prime Contractor may withhold 5% of invoiced amounts for Subcontractor Services when directedto do so by FedSource. If the Prime Contractor intends to withhold, it willindicate its intent in the task order. In the event withholding is done, fundswill be withheld pending approval of the Services by the Government. Withheldfunds will be promptly returned to Subcontractor upon approval by theGovernment, along with any interest on the withheld amounts that have accruedand are paid by the Government. If the Government intends to not releasewithheld amounts, the Subcontractor will be promptly notified.

 

**G.13****                      REPORTING**

 

Quarterly status reports shall be processed and forwarded to the PrimeContractor via email NLT the 8th day of each new quarter. Inputshall include at a minimum new offerings/product initiatives, planned changesto existing offerings, new issues, and plans for resolving issues.

 

**SECTION H-** **SPECIAL CONTRACT REQUIREMENTS**

 

**H.1****                             PUBLICRELEASE OF INFORMATION PERTAINING TO THIS CONTRACT**

 

Any proposed release of information pertaining to this contract or thework called for hereunder shall be submitted to the Prime Contractor forapproval prior to release. No information shall be released without writtenapproval from the Prime Contractor.

 

**H.2****                             PRIMECONTRACTOR AND GOVERNMENT CLOSURES**

 

(a) Those persons working on Prime Contractor premises shallobserve Prime Contractor holidays. Those persons working on government premisesshall observe government holidays.

 

(1) Holidays

 

***Prime Contractor Holidays:***

New Year’s Day -  1 January

President’s Day – 3rd Monday inFebruary

 

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Memorial Day -  Last Monday in May

Independence Day -  4 July

Labor Day – 1st Monday inSeptember

Thanksgiving Day – 4th Thursday inNovember

Day after Thanksgiving

Christmas Day – 25 December

Post Christmas Day - 26 December

 

***Government Holidays:***

New Year’s Day - 1 January

Martin Luther King, Jr.’s Birthday – 3rdMonday in January

President’s Day – 3rd Monday inFebruary

Memorial Day -  Last Monday in May

Independence Day -  4 July

Labor Day

Labor Day – 1st Monday inSeptember

Columbus Day – 2nd Monday inOctober

Veteran’s Day -  11 November

Thanksgiving Day – 4th Thursday inNovember

Christmas Day – 25 December

 

(2) Any other day designated by Federal Statute, Executive Orderor a Presidential proclamation.

 

(3) When a holiday falls on a Sunday, the following Monday will beobserved as a legal holiday.  When aholiday falls on a Saturday, the preceding Friday is observed as a holiday byU.S.  Government Agencies.

 

(4) Unless authorized by the Prime Program Manager, or his/herduly authorized representative, the Subcontractor shall not work UNDER THISSUBCONTRACT at any Contractor facility on any contractor holiday listed abovenor should any deliveries under this subcontract be made to any on site facilityon those days. For those persons working at government facilities, no work willbe done on government holidays listed above without specific writtenauthorization.

 

(b) Administrative Leave:

 

(1) When the Government grants administrative leave to employeesas a result of inclement weather, potentially hazardous conditions, or otherspecial circumstances, subcontractor personnel working at the specificfacility/location granted administrative leave shall also be dismissed.However, the subcontractor shall provide sufficient on-site personnel toperform the requirements of critical work, which will be defined as critical inTask Order.

 

(2) On-site personnel working on this subcontract shall not begranted access to Agency installations during closure situations unless theyare designated as emergency or essential personnel required to the requirementsof critical work, or are otherwise instructed by the Prime Program Manager orduly authorized representative. On-site personnel at another government facilityshall only be granted access under terms agreed to with that Agency.

 

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**H.4****                             INSURANCE**

 

(a) In accordance with FAR28.307-2 the subcontractor shall at his own expense, procure and maintainduring the entire performance period of this subcontract insurance of at leastthe kinds and minimum amounts set forth below:

 
| Worker’s Compensation and Employer’s Liability  Insurance |   | $      | 100,000      |   |
|---------------------------------------------------------------------|--------|--------|--------------|--------|
| General Liability Insurance:                                        |   |   |         |   |
| For Bodily Injury Liability Minimum Per  Occurrence                 |   | $      | 500,000      |   |
| Automobile Liability Insurance:                                     |   |   |         |
| Minimum Per Person                                                  |   | $      | 200,000      |   |
| Minimum Per Occurrence for Bodily Injury                            |   | $      | 500,000      |   |
| Minimum Per Occurrence for Property Damage                          |   | $      |  20,000 |   |

 

(b) Prior to the commencement of work hereunder, the Subcontractorshall furnish to the Prime Program Manager Representative, a written statementof the above required insurance. The policies evidencing required insuranceshall contain an endorsement to the effect that cancellation or any material changein the policies adversely affecting the interest of Prime Contractor in suchinsurance shall not be effective for such period as may be prescribed by thelaws of the state in which this subcontract is to be performed and in no eventless than thirty (30) days after written notice thereof to the Prime ProgramManager.

 

(c) The Subcontractor shall insert the substance of FAR 52.228-7clause, including this paragraph (c), in all first tier subcontracts hereunder.

 

**H.5****                             MEETINGSAND CONFERENCES**

 

Technical meetings and/or conferences may be necessary to resolveproblems and to facilitate understanding of the technical requirements of theTO. Participants at these meetings and conferences shall be members of theSubcontractor’s technical staff and technical representatives of theGovernment. When attendance at such meetings/conferences is authorized by thetask order, all costs shall be billed on a time and materials basis. Whenreimbursement is not authorized by the task order, all costs associated withthe attendance at these meetings and conferences shall be incidental to thecontract and not separately billed.

 

**H.6****                             RULESAND REGULATIONS ON A GOVERNMENT FACILITY**

 

While on the premises of the customer agency, regulations includepresenting valid identification for building entrance and obeying all the rules andregulations provided by the agency. If work is to be performed in a restrictedarea, Subcontractor personnel shall be escorted at all times. Subcontractorsshall comply with the safety rules of the Government installation thatconcern related activities not directly addressed in this contract. TheSubcontractor shall take all reasonable steps and precautions to preventaccidents and preserve the life and health of Subcontractor and Governmentpersonnel.

 

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**H.7****                             NON-PAYMENTFOR ADDITIONAL WORK**

 

Any additional services or change to work not specified in each TO maybe performed by the Subcontractor at the financial risk of the Subcontractor.

 

**H.8****                             PERSONALSERVICES**

 

(a) Prime Contractor and the Subcontractor understand and agreethat the services to be delivered under this subcontract by the Subcontractorto Prime Contractor are non-personal services and the parties recognize andagree that no employer-employee relationship exist or will exist under thesubcontract between Prime Contractor and the Subcontractor’s employees. It istherefore, in the best interest of Prime Contractor to afford both parties afull understanding of their respective obligations.

 

(b) Subcontractor personnel under this subcontract shall not:

 

(1) Be placed in a position where theyare under the supervision, direction, or evaluation of a Prime Contractoremployee.

(2) Be placed in a position of command,supervision, administration or control over Prime Contractor or Governmentpersonnel.

(3) Be used for the purpose of avoidingmanpower ceilings or other personnel rules and regulations.

(4) Be used in administration orsupervision of Government procurement activities.

 

(c) Employee Relationship: The services to be performed under thissubcontract do not require the Subcontractor or his/her personal judgment anddiscretion on behalf of the Prime Contractor or the Government. Rather theSubcontractor’s personnel will act and exercise personal judgment anddiscretion on behalf of the Subcontractor.

 

(d) Inapplicability of Employee Benefits: This subcontract doesnot create an employer-employee relationship. Accordingly, entitlements andbenefits applicable to such relationships do not apply. The entireconsideration and benefits to the Subcontractor for performance of thissubcontract are contained in the provisions for payment under this subcontract.

 

(e) Subcontractor employees shall be clearly identifiable while onPrime Contractor or Government property.

 

(f) Notice. It is the Subcontractor’s, as well as Prime Contractor’sresponsibility to monitor subcontract activities and notify the Prime ProgramManager if the Subcontractor believes that the intent of this clause has beenor may be violated. The following procedures will be used:

 

(1) The Subcontractor shall notify thePrime Program Manager in writing promptly, within 10 calendar days from thedate of any incident that the Subcontractor considers to constitute a violationof this clause. The notice shall include the date, nature, and circumstance ofthe conduct, the name, function, and activity of each government,subcontractor, prime official or employee, or Subcontractor official oremployee involved or knowledgeable about such conduct, identify any documentsor substance of any oral communication involved in the contact, and the 

 

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estimate intime by which Prime Contractor shall respond to this notice to minimize cost,delay or disruption of performance.

 

(2) The Prime Program Manager shall promptly, within 10 calendardays after receipt of notice, respond to the notice in writing. In responding,the Prime Program Manager shall either:

 

(i) Confirm that the conduct is in violation and when necessarydirect the mode of further performance;

 

(ii) Counter any communication regarded as a violation;

 

(iii) Deny that the conduct constitutes a violation and whennecessary direct the mode of further performance; or

 

(iv) In the event the notice is inadequate to make a decision,advise the Subcontractor what additional information is required, and establishthe date by which it should be furnished by the Subcontractor and the datethereafter by which the Prime Contractor will respond.

 

(v) This notice does not constitute a claim and resolution willnot result in any increase to the price/cost of this contract.

 

(g) The Subcontractor shall ensure that all of their personnelworking in Prime Contractor or Government facilities are knowledgeable of thecontent of this policy.

 

**H.9****                             LABORRATES AND CATEGORIES**

 

The Subcontractor may NOT charge a category unless specificallyauthorized by the Prime Program Manager. The labor rates are fixed rates perlabor category specified in the task order. Each individual must meet, at a minimum, the requirements of the laborcategory qualifications for which they are charging against. Any personnelchange must be reported in writing to the Prime before the next invoice cycle.

 

**H.10****                      ORDER OFPRECEDENCE**

 

Any inconsistency in this contractual document (inclusive of documents,provisions or exhibits referenced herein or attached hereto) shall be resolvedby giving precedence in the following order:

 

(1)                                          SubcontractDocument (excluding the Statement of Work and CDRLs)

(2)                                          TaskOrder(TO)

(3)                                          FasTracStatement of Work

(4)                                          PrimeContract Statement of Work and CDRLS

 

**H.11****                      SOLICITINGEMPLOYEES**

 

Neither Prime Contractor nor the Subcontractor shall solicit for hireany employee of each other nor of the other Subcontractors working on theFasTrac Program without the written consent of the employee’s employer. Thisclause, however, shall not restrict in any way the right of Prime Contractor orthe Subcontractor to solicit generally in the media for required personnel.Furthermore, this clause does not restrict employees of Prime Contractor orSubcontractor from pursuing on their own initiative employment opportunitieswith the other party. However, this paragraph shall not apply when an employeeof the subcontractor approaches Prime Contractor for a position (unsolicited byPrime Contractor while the individual is employed by the 

 

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Subcontractor) and employment of that individual by Prime Contractor onthe FasTrac program would be in the best interests of the Government or theFASTRAC program.

 

**H. 12****                   INDEMNIFICATION**

 

In the event Subcontractor, its employees, agents, or lower-tiersubcontractors enter premises occupied by or under the control of PrimeContractor in the performance of this agreement, Subcontractor shall indemnifyand hold harmless Prime Contractor, its officers and employees from anysettlement amount or final judgment award by reasons of property damage orpersonal injury of whatsoever nature or kind arising out of, as a result of, orin connection with such performance occasioned in whole or in part by theactions or omissions of the Subcontractor, its employees, agents, or lower-tiersubcontractors. Without any way limiting the foregoing undertakings,Subcontractor and its lower-tier subcontractors shall maintain liability andproperty damage insurance in reasonable limits covering the obligations setforth above and shall maintain proper Worker’s Compensation insurance coveringall employees performing this Agreement. In the event Subcontractor, itsemployees, agents, or lower-tier subcontractors enter premises occupied by orunder the control of Prime Contractor in the performance of this agreement,Prime Contractor shall indemnify and hold harmless Subcontractor, its officersand employees from any loss, cost, damage, expense, or liability by reasons ofproperty damage or personal injury of whatsoever nature or kind arising out of,as a result of, or in connection with such performance occasioned in whole orin part by the actions or omissions of the Prime Contractor, its employees,agents, or lower-tier subcontractors (other than Subcontractor).

 

**H.13****                      PHASE-OUT OFCONTRACT AND CONTINUITY OF SERVICES**

 

The Subcontractor must recognize that services under this contract mustcontinue without interruption and that upon contract expiration, a successor,either the Government or another contractor, may continue services. TheSubcontractor agrees to exercise its best effort and cooperate effectively inan orderly and efficient transition to any successor contractor in the event ofcontract expiration.

 

**H.14****                      GOVERNMENTFURNISHED FACILITIES, SUPPLIES AND SERVICES**

 

The Subcontractor agrees to use all available Government working space,materials, services, and other support at, or available through, any Governmentactivity where work under this contract will be performed, at no charge to theSubcontractor.

 

a.                              **PHYSICAL SECURITY:**The Subcontractor shall be responsiblefor safeguarding all Government property provided for Subcontractor use as wellas for the Subcontractor’s property. At the close of each work period,government facilities, equipment, and materials shall be secured.

 

b.                             **EQUIPMENT:**Contract personnel shall have joint use of allthe equipment available for performing services required by this contract.

 

**H.15****                      ACQUISITION/LEASINGOF INFORMATION PROCESSING RESOURCES**

 

In the event the Subcontractor proposes to lease or acquire anyInformation Technology (IT) equipment or software for the performance of a taskorder under this contract, it must be precisely defined in the task orderproposal or an amendment thereto. The acquisition/lease (including terms andconditions, particularly in regard to end-of-lease terms), the procurement 

 

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method, and the condition must be approved, in writing, by the Prime’sCOTR prior to action by the Contractor. In addition, all IT equipment shallmeet Section 508 of the Rehabilitation Act of 1973 (29 U.S.C. 794(d) accessibilityrequirements. Information on Section 508 may be obtained atwww.section5O8.gov.

 

**H.16****                      IMPAIRED PERSONNEL**

 

The Subcontractor is required to remove immediately any Subcontractorpersonnel whose actions or impaired state raises reasonable suspicion thatclear and present danger of physical harm exists to the public, othercontractor employees, Government personnel, or the impaired individual.

 

**H17****                         MARKETING**

 

The Subcontractor shall have an in-depth knowledge of FasTrac includingits purpose and how other Government agencies benefit from the use of itscontracts. The Subcontractor shall have the capability to market the FasTracproducts/services.

 

**SECTION I- CONTRACT CLAUSES**

 

**I.1****                                  DESIGNATIONS**

 

The following contract clause(s) pertinent to this section is/arehereby incorporated by reference.

 

For the purposes of the clauses below which are incorporated byreference into the subcontract, the following terms shall be changed to thedesignations indicated below:

 

“Government” shall mean “Prime Contractor”

“Contractor” shall mean “Subcontractor”

“Contracting Officer” shall mean “PrimeProgram Manager”

“COR” or “Contracting Officer’sRepresentative” shall mean “Prime Program Manager”

“Contract” shall mean “Subcontract”

 

These changes do not apply to clauses allowing access to financial andaccounting records and data.

 

**1.2.****                            52.252-2CLAUSES INCORPORATED BY REFERENCE (FEB 1998)**

 

This contract incorporates one or more clauses by reference, with thesame force and effect as if they were given in full text. The full text of aclause may be accessed electronically at this address: www.arnet.gov/far/

 
| **52.202-1**  | ** ** | **DEFINITIONS  (DEC 2001)**                                                                      |
|---------------|------------|--------------------------------------------------------------------------------------------------|
| **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)**                         |
| **52.204-2**  | ** ** | **SECURITY  REQUIREMENTS (AUG 1996)**                                                            |

 

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| **52.204-4**  | ** ** | **PRINTED  OR COPIED DOUBLE-SIDED ON RECYCLED PAPER (AUG 2000)**                                                                               |
|---------------|------------|------------------------------------------------------------------------------------------------------------------------------------------------|
| **52.204-7**  | ** ** | **CENTRAL  CONTRACTOR REGISTRATION (OCT 2003)**                                                                                                |
| **52.209-6**  | ** ** | **PROTECTING  THE GOVERNMENT’S INTEREST WHEN SUBCONTRACTING WITH CONTRACTORS DEBARRED,  SUSPENDED, OR PROPOSED FOR DEBARMENT (JUL 1995)** |
| **52.215-2**  | ** ** | **AUDIT  AND RECORDS - NEGOTIATION (JUNE 1999)**                                                                                          |
| **52.216-22** | ** ** | **INDEFINITE  QUANTITY (OCT 1995)**                                                                                                            |
| **52.217-8**  | ** ** | **OPTION  TO EXTEND SERVICES (NOV 1999)**                                                                                                      |
| **52.222-1**  | ** ** | **NOTICE  TO THE GOVERNMENT OF LABOR DISPUTES (FEB 1997)**                                                                                     |
| **52.222-3**  | ** ** | **CONVICT  LABOR (AUG 1996)**                                                                                                                  |
| **52.222-4**  | ** ** | **CONTRACT  WORK HOURS AND SAFETY STANDARDS ACT - OVERTIME COMPENSATION (SEPT 2000)**                                                          |
| **52.222-21** | ** ** | **PROHIBITION  OF SEGREGATED FACILITIES (FEB 1999)**                                                                                           |
| **52.222-26** | ** ** | **EQUAL  OPPORTUNITY (APR 2002)**                                                                                                              |
| **52.222-29** | ** ** | **NOTIFICATION  OF VISA DENIAL (FEB 1999)**                                                                                                    |
| **52.222-35** | ** ** | **EQUAL  OPPORTUNITY FOR SPECIAL DISABLED VETERANS, VETERANS OF THE VIETNAM ERA, AND  OTHER ELIGIBLE VETERANS (DEC 2001)**                     |
| **52.222-36** | ** ** | **AFFIRMATIVE  ACTION FOR WORKERS WITH DISABILITIES (JUN 1998)**                                                                               |
| **52.222-37** | ** ** | **EMPLOYMENT  REPORTS ON SPECIAL DISABLED VETERANS, VETERANS OF THE VIETNAM ERA, AND OTHER  ELIGIBLE VETERANS (DEC 2001)**                     |
| **52.222-41** | ** ** | **SERVICE  CONTRACT ACT OF 1965, AS AMENDED (MAY 1989)**                                                                                  |
| **52.222-43** | ** ** | **FAIR LABOR STANDARDS ACT AND SERVICE CONTRACT ACT-PRICE ADJUSTMENTS  (MULTIPLE YEAR AND OPTION CONTRACTS) (MAY 1989)**                  |
| **52.223-5**  | ** ** | **POLLUTION  PREVENTION AND RIGHT-TO-KNOW INFORMATION (APR 1998)**                                                                             |
| **52.223-6**  | ** ** | **DRUG-FREE  WORKPLACE (MAY 2001)**                                                                                                       |
| **52.223-10** | ** ** | **WASTE  REDUCTION PROGRAM (AUG 2000)**                                                                                                        |
| **52.223-14** | ** ** | **TOXIC  CHEMICAL RELEASE REPORTING (OCT 2000)**                                                                                               |
| **52.224-1**  | ** ** | **PRIVACY  ACT NOTIFICATION (APR 1984)**                                                                                                       |
| **52.224-2**  | ** ** | **PRIVACY  ACT (APR 1984)**                                                                                                                    |
| **52.225-1**  | ** ** | **BUY  AMERICAN ACT -SUPPLIES (MAY 2002)**                                                                                                |
| **52.225-3**  | ** ** | **BUY  AMERICAN ACT - NORTH AMERICAN FREE TRADE AGREEMENT - ISRAELI TRADE  (MAY 2002)**                                                   |
| **52.225-13** | ** ** | **RESTRICTIONS  ON CERTAIN FOREIGN PURCHASES (JULY 2000)**                                                                                |
| **52.227-1**  | ** ** | **AUTHORIZATION  AND CONSENT (JUL 1995)**                                                                                                      |
| **52.227-2**  | ** ** | **NOTICE  AND ASSISTANCE REGARDING PATENT AND COPYRIGHT INFRINGEMENT (AUG 1996)**                                                              |
| **52.227-14** | ** ** | **RIGHTS  IN DATA - GENERAL (JUN 1987)**                                                                                                       |
| **52.228-5**  | ** ** | **INSURANCE  - WORK ON A GOVERNMENT INSTALLATION (JAN 1997)**                                                                                  |
| **52.228-7**  | ** ** | **INSURANCE  - LIABILITY TO THIRD PERSONS (MAR 1996)**                                                                                         |
| **52.229-3**  | ** ** | **FEDERAL,  STATE, AND LOCAL TAXES (JAN 1991)**                                                                                                |
| **52.229-5**  | ** ** | **TAXES - CONTRACTS PERFORMED IN U.S. POSSESSIONS OR PUERTO RICO (APR  1984)**                                                                 |
| **52.229-6**  | ** ** | **TAXES -  FOREIGN FIXED-PRICE CONTRACTS (JAN 1991)**                                                                                          |
| **52.232-1**  | ** ** | **PAYMENTS  (APR 1984)**                                                                                                                       |
| **52.232-7**  | ** ** | **PAYMENTS  UNDER TIME-AND-MATERIALS AND LABOR-HOUR CONTRACTS (FEB 2002)**                                                                     |
| **52.232-11** | ** ** | **EXTRAS  (APR 1984)**                                                                                                                         |
| **52.232-23** | ** ** | **ASSIGNMENT  OF CLAIMS (JAN 1986)**                                                                                                           |
| **52.232-25** | ** ** | **PROMPT  PAYMENT (FEB 2002)**                                                                                                                 |
| **52.233-1**  | ** ** | **DISPUTES  (JULY 2002)**                                                                                                                 |
| **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)**                                                                                                 |
| **52.242-13** | ** ** | **BANKRUPTCY  (JUL 1995)**                                                                                                                     |
| **52.243-1**  | ** ** | **CHANGES.  FIXED PRICE (AUG 1987), ALTERNATE II (APR 1984)**                                                                                  |

 

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| **52.243-3**  | ** ** | **CHANGES  - TIME-AND-MATERIALS OR LABOR-HOURS (SEP 2000)**                                           |
|---------------|------------|-------------------------------------------------------------------------------------------------------|
| **52.244-2**  | ** ** | **SUBCONTRACTS  (AUG 1998)**                                                                          |
| **52.244-5**  | ** ** | **COMPETITION  IN SUBCONTRACTING (DEC 1996)**                                                         |
| **52.245-2**  | ** ** | **GOVERNMENT  PROPERTY (FIXED-PRICE CONTRACTS) (DEC 1989)**                                           |
| **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)**                                                    |

 

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**I.3****                                  FAR52.244-6 SUBCONTRACTS FOR COMMERCIAL ITEMS (MAY 2002)**

 

(a) *Definitions.*Asused in this clause

 

“Commercial item” has the meaning containedin the clause at 52.202-1, Definitions.

 

“Subcontract” includes a transfer of commercial items betweendivisions, subsidiaries, or affiliates of the Contractor or subcontractor atany tier.

 

(b) To the maximum extent practicable, the Subcontractor shallincorporate, and require its subcontractors at all tiers to incorporate,commercial items or non-developmental items as components of items to besupplied under this contract.

 

(c)(1) The Subcontractor shall insert the following clauses insubcontracts for commercial items:

 

(i) 52.219-8,**Utilization of Small Business Concerns (Oct 2000) (15U.S.C. 637(d)(2)(3)), in all subcontracts that offer further subcontractingopportunities. If the subcontract (except subcontracts to small businessconcerns) exceed $500,000 ($1,000,000 for construction of any public facility),the subcontractor must include 52.219-8 in lower tier subcontracts that offersubcontracting opportunities.

(ii) 52.222-26, Equal Opportunity (Apr2002) (E.O. 11246).

(iii) 52.222-35*,*EqualOpportunity for Special Disabled Veterans, Veterans of the Vietnam Era, andOther Eligible Veterans (Dec 2001) (38 U.S.C. 42 12(a));

(iv) 52.222-36, Affirmative Action for Workers with Disabilities(Jun 1998) (29 U.S.C. 793).

(v) 52.247-64, Preference for Privately Owned U.S.-FlaggedCommercial Vessels (Jun 2000) (46 U.S.C. Appx 1241) (flow down not required forsubcontracts awarded beginning May 1, 1996).

 

(c)(2) While not required, the Subcontractor may flow down tosubcontracts for commercial items a minimal number of additional clausesnecessary to satisfy its contractual obligations.

 

(d) The Subcontractor shall include the terms of this clause,including this paragraph (d), in subcontracts awarded under this contract.

 

**I.4****                                  FAR52.246-20 WARRANTY OF SERVICES (MAY 2001)**

 

(a) Definition. “Acceptance,” as used in this clause, means theact of an authorized representative of the Government by which the Governmentassumes for itself, or as an agent of another, ownership of existing andidentified supplies, or approves specific services, as partial or completeperformance of the contract.

(b) Notwithstandinginspection and acceptance by the Government or any provision concerning theconclusiveness thereof, the Subcontractor warrants that all services performedunder this contract will, at the time of acceptance, be free from defects inworkmanship and conform to the requirements of this contract. The Prime ProgramManager shall give written notice of any defect or nonconformance to theSubcontractor within 30 days from the date of acceptance by the Government.This notice shall state either –

 

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(1) That the Subcontractorshall correct or re-perform any defective or nonconforming services; or

 

(2) That the Government does not requirecorrection or re-performance.

 

(c) If the Subcontractor is required to correct or re-perform, itshall be at no cost to the Government, and any services corrected orre-performed by the Subcontractor shall be subject to this clause to the sameextent as work initially performed. If the Subcontractor fails or refuses tocorrect or re-perform, the Prime Contractor may make an equitable adjustment inthe contract price.

 

(d) If the Government does not require correction orre-performance, the Prime Program Manager may make an equitable adjustment inthe contract price.

 

(e) Neither party, under any circumstances, shall be liable to theother for any indirect, special, incidental, cover, punitive, or consequentialdamages or similar damages, including lost profits or lost data, even if suchparty has been advised of the possibility of such damages. Subcontractor’scumulative liability to Prime Contractor and all other parties arising our ofor relating to this agreement shall not exceed in aggregate the fees paid toSubcontractor hereunder.

 

**I.5****                                  SUBCONTRACTINGWITH FIRMS THAT ARE OWNED OR CONTROLLED BY THE GOVERNMENT OF A TERRORISTCOUNTRY**

 

(a) Unless the****Government determines that there is a compelling reason todo so, the Subcontractor shall not enter into any subcontract in excess of $25,000with a firm, or a subsidiary of a firm, that is identified, on the List ofParties Excluded from Federal Procurement and Non-procurement Programs, asbeing ineligible for the award of Defense contracts or subcontracts because itis owned or controlled by the government of a terrorist country.

 

(b) A corporate officer or a designee of the Subcontractor shallnotify the Contracting Officer, in writing, before entering into a subcontractwith a party that is identified, on the List of Parties Excluded from FederalProcurement and Non-procurement Programs, as being ineligible for the award ofDefense contracts or subcontracts because it is owned or controlled by thegovernment of a terrorist country. The notice must include the name of theproposed subcontractor and the compelling reason(s) for doing business with thesubcontractor notwithstanding its inclusion on the List of Parties Excludedfrom Federal Procurement and Non-procurement Programs.

 

**I.6****                                  PROHIBITIONON USE OF NONIMMIGRANT ALIENS—GUAM**

 

The work required by this contract shall not be performed by any alienwho is issued a visa or otherwise provided nonimmigrant status under Section 101(a)(15)(H)(ii) ofthe Immigration and Nationality Act (8 U.S.C. I 101(a)(15)(H)(ii)). Thisprohibition does not apply to the performance of work by lawfully admittedcitizens of the freely associated states of the Republic of the MarshallIslands, the Federated States of Micronesia, or the Republic of Palau.

 

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