Exhibit 10.1





Exhibit 10.1




ADMINISTRATIVE AGREEMENT




This Agreement dated of October 19, 2010, is made between GTSI Corp. (“GTSI”) and the United
States Small Business Administration (“SBA”). As used herein, GTSI means GTSI Corp. and all its
operating sectors, groups, divisions, units, and wholly-owned subsidiaries, including those
acquired or established during the term of this Agreement.



Preamble





A. GTSI is a business incorporated in the State of Delaware with its principal executive
offices located in Herndon, Virginia.




B. On October 1, 2010, SBA suspended GTSI, including all of its divisions or other
organizational elements, from Federal Government contracting and from directly or
indirectly receiving the benefits of federal assistance programs, pursuant to the
authority and the procedures of the Federal Acquisition Regulation (FAR) Subpart 9.4. The
basis for SBA’s suspension is set forth in SBA’s Notice of Suspension, which is
incorporated by reference herein. SBA’s suspension is based on evidence, compiled in SBA’s
Administrative Record, which SBA concluded was adequate to indicate a lack of business
integrity or honesty in the award and performance of government contracts such that it
seriously affects the present responsibility of GTSI to be a government contractor. GTSI
contested the suspension. The Agency’s Office of Inspector General is conducting an
ongoing investigation into the conduct and practices of GTSI.




C. On October 7, 2010, SBA requested additional information from GTSI. This letter is
incorporated herein by reference. In response to SBA’s Notice of Suspension and the
October 7, 2010 letter, GTSI provided the SBA with an interim response including (1) GTSI
organizational documents and charts of personnel changes; (2) GTSI Executive Summary; (3) a
summary curriculum vitae of a proposed internal monitor; and (4) a copy of the September
26, 2008 letter from DHS/CIS to the SBA. These documents were added to the Administrative
Record. In addition, GTSI met with SBA officials on October 6, 8, and 14, 2010 to request
modification of the suspension. GTSI made a number of representations and commitments to
the SBA concerning GTSI’s present responsibility.




D. The actions and conduct that are the basis of the suspension took place while Scott W.
Friedlander served as an Executive Vice President of GTSI. Mr. Friedlander is currently
the President and Chief Executive Officer of GTSI. Said actions and conduct also took
place while Charles E. De Leon served as Senior Vice President and General Counsel of GTSI,
which position he continues to occupy. Said actions and conduct also took place while Tom
Kennedy served as Vice President of Civilian Sales and General Manager, in which position
he still serves; while Scott Schmader served as Senior Sales Manager, in which position
he still serves; and while Patrick Berg served as Program Manager, in which position he
remains. All of the foregoing are GTSI employees identified in the Administrative Record.


 


 









 






E. Jim Leto, former Chief Executive Officer, Joseph Ragan, former Chief Financial Officer,
Bob Mitchell, former Chief Information Officer, Bill Weber, former Senior Vice President of
Professional Services, and Todd Leto, former Senior Vice President of Sales are former GTSI
employees identified in the Administrative Record. These individuals are no longer
employed by GTSI and currently have no direct or indirect control over its business or
operations.




F. GTSI has expressed interest in taking the actions necessary to demonstrate that,
notwithstanding SBA’s conclusions and decisions based upon the Administrative Record, GTSI
may be trusted to deal fairly and honestly with the Government, and that continuing the
suspension of GTSI from future work with the Government is not necessary if the terms and
conditions set forth herein are duly and forthrightly implemented. To this end, GTSI has
agreed to take the actions specified herein to assure that GTSI possesses the high degree
of business honesty and integrity required of a government contractor.




G. SBA has concluded that FAR 9.407 and the facts set forth in the Administrative Record
provide an adequate basis for the October 1, 2010 suspension heretofore imposed upon GTSI
by SBA. GTSI irrevocably waives and relinquishes any defense or objection to said
suspension and shall not now or at any time hereafter contest or object to said suspension
or its imposition by SBA. However, SBA has determined that, based upon information
currently known to SBA, GTSI’s corrective actions and prospective cooperation and
transparency reflected in the terms and conditions of this Agreement, if fully and timely
implemented and performed by GTSI, provide adequate assurance that GTSI’s future dealings
with the Government, if any, will be conducted responsibly during the term hereof and that
continuing the suspension of GTSI is not necessary at this time to protect the Government’s
interests pending completion of the pending SBA Office of Inspector General (“OIG”)
investigation. GTSI agrees to, accepts, and shall not challenge this Agreement and the
duties, responsibilities, commitments and other terms and conditions undertaken by it and
otherwise reflected herein. GTSI does not concede or admit any violation of law or
wrongdoing prior to the date hereof; but nothing herein shall limit the SBA’s or any other
governmental entity’s power, authority or discretion to conclude otherwise based upon
current facts alone or in combination with additional facts hereafter obtained. Nothing in
this Agreement is intended to interfere with or prevent any pending or future investigation
into GTSI or its conduct.


 


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Terms and Conditions




1. TERM. The term of this Agreement shall commence on the date hereof and terminate on the
earlier of: (a) the third anniversary of the date hereof; or (b) the 90th day after the
SBA’s Office of Inspector General notifies the Agency that it has completed its investigation of
GTSI; or (c) the notification date of any proposed debarment of GTSI by SBA.



2. LIFTING OF SUSPENSION. Contingent and conditioned upon the continuing, demonstrated
truthfulness of GTSI’s representations and offers made herein, its ongoing, full, timely and
complete compliance with this Agreement and all its obligations hereunder, and its ongoing
demonstration of present responsibility to engage hereafter in all government contracting
activities in accordance with applicable law, SBA lifts and terminates, as of the date hereof and
subject to the terms and conditions herein, the suspension imposed on GTSI on October 1, 2010, and
shall cause GTSI’s name to be removed from the Excluded Parties List.



3. OPERATIONS IN COMPLIANCE WITH APPLICABLE LAWS, RULES AND REGULATIONS. GTSI covenants and
agrees that from and after the date hereof, all its governmental contracting business and
operations, both with respect to existing contracts and opportunities and also with respect to all
new contracts and opportunities solicited or entered into by it, shall be conducted in full
compliance with all applicable laws, rules and regulations, and shall reflect present
responsibility and integrity in all respects.



4. ONGOING INVESTIGATION. Nothing in this Agreement shall in any way affect, limit or waive,
SBA’s, SBA’s OIG, or any other Government agency’s or instrumentality’s ongoing right and
discretion to investigate any matter or to review any evidence relating to GTSI’s business,
conduct, or operations, and to take any enforcement, regulatory or other legal action any of the
foregoing deem appropriate based upon such investigation or review.



5. EMPLOYEES. The terms “employee” or “employees” as used in this Agreement include GTSI’s
officers, permanent, temporary, and contract employees, full-time and part-time employees,
consultants, and members of the Board of Directors.



6. RESIGNATIONS AND SUSPENSIONS. GTSI represents and agrees that within seven days from the
date hereof:




	 	a.	 	Mr. Friedlander shall resign as the President and CEO of GTSI, and
also as a member of the Board of Directors (“Board”) of GTSI, and will no longer
be employed by GTSI or involved in its supervision or oversight; and Mr. De Leon
shall resign as the Senior Vice President and General Counsel of GTSI and also
from any advisory or other position he may hold with respect to GTSI’s Board, and
will no longer be employed by
GTSI. Neither of the foregoing shall be rehired by GTSI during the term hereof.
After resignation, neither Mr. Friedlander nor Mr. DeLeon shall have any actual,
direct or indirect control over the Company, its business, operations, financial,
legal or other affairs.




 


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	 	b.	 	GTSI shall suspend Tom Kennedy, Scott Schmader and Patrick Berg from
their employment by GTSI. Such suspension shall remain in force and effect
throughout the term hereof. During such suspension, none of the foregoing shall
have any actual, direct or indirect control over the Company, its business,
operations, financial, legal or other affairs.
	 
	 	c.	 	If and to the extent any shareholder vote should hereafter be sought
or required in connection with this Agreement or the terms and conditions herein,
GTSI represents and agrees that it shall procure from Friedlander, DeLeon,
Kennedy, Schmader and Berg their irrevocable promises and proxy that any shares,
options or other ownership interests in GTSI owned by any of them shall be voted
in favor of affirming this Agreement and performing all of GTSI’s obligations
hereunder throughout the term hereof.





7. DOCUMENTS. In a letter dated October 7, 2010, SBA requested certain information and
documents from GTSI. GTSI agrees to provide all the information and documents requested by SBA.




	 	a.	 	Within 15 days of the date hereof, GTSI shall provide all information
and documents responsive to requests 1, 3, 4, 8, 16, 17, 18, 21, 22, 25, 27, 28,
29, 30, 31, 32. The response to the first sentence of request 17 shall be provided
within 15 days of the date hereof. Any required production of electronic mail
shall be made as part of the production required by 7(b).






	 	b.	 	Within 60 days of the date hereof, GTSI shall provide all information
and documents responsive to requests 2, 5, 6, 7, 9, 10, 11, 12, 13, 14, 15, 19,
20, 23, 24, 26. The response to the second sentence of request 17 shall be
provided within 60 days of the date hereof.






	 	c.	 	If GTSI seeks to assert any privilege (including attorney-client
privilege or the attorney work-product doctrine) with respect to any document
requested by SBA or the Monitor hereunder pursuant to paragraphs below, it shall
do so only after good faith review and determination that such assertion is
consistent with applicable law and with the faithful and full performance of its
disclosure obligations and commitments hereunder. Any document so withheld must be
reflected upon a comprehensive privilege log, provided within five days after such
documents are withheld, setting forth the date and a description of the document
and its subject matter, the identity of all senders and recipients (including
whether a sender, recipient, cc or bcc), and the basis for the assertion of
privilege.






	 	d.	 	GTSI shall designate with an appropriate legend any produced document
which in good faith it contends contains confidential or proprietary business or
financial information.






 


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8. LIMITATION ON NEW CONTRACTS AND TASK ORDERS. GTSI agrees that during the term hereof, it
will not obtain or attempt to obtain any new federal governmental contracts, subcontracts or any
business, which in any capacity, whether directly or indirectly is intended to benefit small
business, including task orders and options on existing contracts. This includes but is not limited
to contracts involving small business contractors, set asides, benefits, preferences or benefits in
any of the following circumstances, which are illustrative only and are not intended to be an
exhaustive list: contracts with the government in which a small business contractor is the prime
contractor and GTSI is a subcontractor or vendor to such small business prime contractor, or is a
subcontractor or vendor to a subcontractor of the small business prime contractor; contracts with
the government in which GTSI is a party to a joint venture with a small business; contracts
involving, arising out of or relating to any mentor/protégé relationship between GTSI and a small
business. If GTSI has bid or desires to bid on any opportunity which there is any reason to believe
could fall within conduct prohibited by this Agreement, GTSI will notify SBA of the intended
activity or conduct prior to taking any actions. SBA will determine if any conduct or activities
that GTSI intends to pursue fall within the prohibition above. GTSI agrees to accept SBA’s
determination of whether the conduct is prohibited by this Agreement.




	 	a.	 	Said Limitation on New Contracts And Task Orders shall apply in
connection and with respect to all contracts for which a prime contractor or
subcontractor has certified that it is an eligible small business under the
provisions of 13 C.F.R Part 121, and also for all contracts for which the
provisions of 13 C.F.R. § 125.6 apply. GTSI’s compliance with this limitation
constitutes an element of GTSI’s present responsibility for Government
contracting. Failure by GTSI to abide by the limitation set forth herein shall
constitute a separate cause for suspension and/or debarment.






	 	b.	 	The Limitation On New Contracts And Task Orders detailed above,
including task orders and options on existing contracts, shall not include:






	 	i.	 	Contracts awarded through a full and open
competition, or task orders performed on such contracts, in which GTSI
is or will be the prime contractor and did not or (with respect to new
contracts or task orders) does not represent itself as a small business;






	 	ii.	 	Contracts or new task orders under such
contracts, awarded on a set-aside or reserved basis, or in which any
preference was or is given to small business, provided that GTSI is the
prime contractor and that GTSI meets the size standard for the NAICS
code that is assigned to that contract or task order; provided, however,
that prior to obtaining any new contracts or task orders (including with
respect to existing contracts) GTSI complies with all notification and
approval provisions in paragraph 7c, and provided further that all
applicable laws and regulations were and are followed in obtaining and
performing any existing contract, and all applicable laws and regulations
are followed in attempting to obtain, obtaining, and performing any new
contracts.




 


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	 	c.	 	For any procurement which falls under the exception detailed in
paragraph b(ii) above, and for which GTSI will seek to certify that it is a small
business pursuant to 13 C.F.R. Part 121, GTSI agrees to notify SBA and the Monitor
at least ten business days prior to submitting an offer. This notification will
include the name of the procuring Agency, the Solicitation Number, the North
American Industry Classification System (NAICS) code assigned to the procurement
and the date that offers are due. If prior to the date of this Agreement GTSI has
already submitted any offers in connection with any government solicitations for
which GTSI believes it is entitled to proceed under the exception in paragraph
b(ii) above and for which GTSI has certified that it is a small business pursuant
to 13 C.F.R. Part 121, GTSI will provide SBA with all the foregoing documents and
items of information within five calendar days from the execution of the
Agreement. With respect to all pending offers subject to this paragraph and also
any future offers covered hereby which GTSI may propose to make during the term
hereof, GTSI agrees that SBA shall be authorized to review the above-referenced
offers and related documents and information. With respect to all existing,
pending or future GTSI contracts or offers subject to this paragraph, SBA shall
have the above-referenced right of review prior to GTSI submitting a further
contract offer or task order offer or any other such offer, and also prior to any
existing offer’s acceptance. After such review, SBA will determine whether GTSI
is eligible to place an offer for the subject procurement. If SBA determines that
GTSI is not eligible, GTSI agrees that it will accept SBA’s determination and will
not submit an offer or will withdraw any pending offer. SBA will also review the
NAICS code for the procurement at issue. SBA will determine whether the proper
NAICS code is applied, or if the procurement is misclassified. GTSI agrees to
accept SBA’s determination of whether the procurement at issue is misclassified
with the incorrect NAICS code. If SBA determines that the procurement at issue is
classified under an incorrect NAICS code, GTSI agrees that it will not submit an
offer on that solicitation; and, if a pending offer has prior hereto been
submitted on a pending solicitation, GTSI agrees that it will forthwith withdraw
its offer upon such solicitation. If after notice and review SBA determines that
an existing, pending or future contract vehicle subject to this paragraph and
paragraph b(ii) complies in full with applicable law and is properly classified,
then from that point forward GTSI may seek task orders pursuant to such contract
vehicle without first giving notice of each such task order offer to SBA for
approval under this
paragraph. This paragraph and the requirements herein will not apply to options or
task orders actually awarded prior to the date hereof.




 


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9. MONITOR: GTSI agrees to retain an independent Monitor that shall monitor the compliance of
GTSI with this Agreement throughout the term hereof.




	 	a.	 	GTSI agrees that a Monitor acceptable to SBA, in its sole discretion,
shall be retained by GTSI within 15 calendar days of the execution of the
Agreement. GTSI may propose potential Monitors for SBA’s consideration. SBA may
also identify a Monitor acceptable to it for this position. In either event GTSI
shall retain the Monitor acceptable to SBA. GTSI shall be responsible for and
shall promptly and fully pay all costs, fees, retainers or other reimbursements
and compensation customarily charged by and payable to such Monitor. If and to
the extent the Monitor requires, at his or her sole discretion as communicated in
writing, staff assistance and/or legal counsel, the Monitor shall be authorized
and empowered to retain such assistance and/or legal counsel. GTSI shall be
responsible for and shall pay all reasonable costs, fees, retainers or other
reimbursements and compensation payable to or on account of such staff or legal
counsel for the Monitor. GTSI shall pay all such advance retainers, if any,
required by the Monitor on account of his or her own customary fees or charges and
that of his or staff or counsel. Any retainer agreement between GTSI and the
Monitor must be submitted to and approved in advance by SBA; and the Agreement
between GTSI and the Monitor shall incorporate this Agreement’s terms by reference
and be consistent with all terms herein. SBA may require that the Monitor be
replaced with a new Monitor, during the term hereof, should SBA in its discretion
conclude such replacement is necessary to accomplish the purposes of this
Agreement.






	 	b.	 	Said Monitor shall report to and be responsible to the SBA, and shall
be free to communicate with the SBA without interference by GTSI. SBA may
communicate with the Monitor on a confidential basis and without disclosure to
GTSI. The purpose of the Monitor is to inspect on an ongoing basis, and to report
to the SBA regarding, GTSI’s ongoing compliance in all respects with this
Agreement; its compliance with applicable laws, rules and regulations (both with
respect to existing contracts still being performed and also with respect to any
new contracts); and whether GTSI is seeking, entering into and performing
government contracts responsibly and with integrity.






	 	c.	 	The Monitor will report to SBA on GTSI’s compliance with this
Agreement, with all applicable laws, rules and regulations in connection with its
seeking, obtaining and performing government contracts, and with respect to GTSI’s
present responsibility to obtain and perform government contracts. Such reports
will be provided to SBA on a regular




 


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basis, no less than monthly. In addition, as
and when requested by SBA, the Monitor shall meet with and report to SBA on such topics as may from time to time be
identified by SBA in its discretion. Said reports shall be deemed confidential to
SBA and shall not first be provided to GTSI for review or approval; and copies of
all or part thereof, or content therein, or a letter based upon the Monitor’s
findings, may be disclosed or provided by SBA to GTSI, in SBA’s sole discretion.
Within ten days of receipt of any report or letter provided by SBA, GTSI shall
provide its plan to implement, promptly and fully, all changes, actions or
procedures recommended by the Monitor.




	 	d.	 	The Monitor’s reports are for SBA’s assistance and monitoring
purposes and shall be considered by SBA as part of the totality of the information
available to it. Proof of GTSI’s ongoing compliance or non-compliance with this
Agreement and all its obligations under law shall be determined based upon all
relevant information, documents, communications, testimony and other evidence of
such compliance or lack thereof. Neither the delivery nor review by SBA of any
Monitor report shall waive, limit or in any way diminish SBA’s right to obtain,
review, analyze or evaluate any underlying, actual evidence of GTSI’s compliance
or non-compliance with this Agreement or applicable law.






	 	e.	 	Said Monitor shall have unfettered, immediate and, if requested,
real-time access to all Company documents, information and personnel, including
without limitation all files, records, communications, IT and communications
systems, email systems, electronic documents, and databases. The Monitor shall be
empowered to provide no prior notice or only minimal prior notice if the Monitor
determines, in his or her sole discretion, that the needs or exigencies of his or
her monitoring require immediate access or communication. The Monitor shall,
during the term hereof, be permitted to communicate with any employee, officer,
manager, shareholder or director of GTSI pertaining to any matter pertaining to
the present responsibility of GTSI. GTSI commits to cooperate in good faith with
any such communications, and to provide, or to have provided, copies of any
documents relating to any such communications within a reasonably prompt time.
The Monitor shall retain all GTSI information and documents in the strictest
confidence and shall disclose all such information solely to SBA or other
governmental investigatory authorities, and shall not disclose such information or
documents to third parties outside GTSI or use such information for any purpose
not associated with his or her monitoring activities provided for herein.






	 	f.	 	GTSI shall provide to the Monitor, at GTSI’s headquarters, on-site
management-type office space, furniture, telephone, network access, equipment and
supplies, along with adequate enclosed conference room space or access for the
Monitor such that he or she can undertake confidential conferences with GTSI
Employees.




 


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	 	g.	 	Failure to retain a Monitor within the time allotted, or to cooperate
fully and promptly with the Monitor’s inquiries, document and information requests
and other monitoring activities, will be considered a breach of this Agreement and
will result in SBA reinstating the suspension of GTSI including all of its
divisions or other organizational elements and, if appropriate, initiating
debarment proceedings.






	 	h.	 	GTSI hereby agrees that the Monitor shall be released from, held
harmless from, and indemnified against any claims, demands, liabilities,
obligations, damages, suits or costs of any sort whatsoever, whether to GTSI or to
any third party, arising out of or relating in any way to the Monitor’s agreement,
presence at GTSI or performance of his or her duties and obligations as set forth
herein.





10. GTSI agrees to adopt, implement, and to maintain a self-governance program that includes a
business ethics program that covers all employees. The business ethics program shall be maintained
so as to ensure that GTSI and each of its employees maintains the business honesty and integrity
required of a Government contractor and that GTSI operates in strict compliance with all applicable
laws, regulations, and the terms of any contract.




	 	a.	 	GTSI agrees that it will create a position and designate an employee
as GTSI’s Ethics Officer within 15 business days of the execution of this
Agreement. The Ethics Officer is responsible for managing all aspects of the GTSI
business ethics program.






	 	b.	 	GTSI agrees to adopt within fifteen business days of the execution
of this Agreement a written Code of Business Ethics (“the Code” or the “Code of
Business Ethics”) and will provide a copy to SBA for its review and approval.
When approved by SBA, the Code shall be deemed incorporated by reference into
this Agreement.






	 	c.	 	GTSI will circulate the Code of Business Ethics to each employee of
GTSI. GTSI agrees that after reading the Code, each current employee will be
instructed to sign, in a register to be maintained by GTSI and open to inspection
by SBA, that he or she has read and understood the Code. GTSI shall certify to SBA
within thirty business days after the effective date of this Agreement that all
employees have signed the register. Thereafter, at least once in each calendar
year, each then-current employee shall repeat the procedure of reading the Code
and signing the register. In addition, within 30 days of starting employment with
GTSI, new employees shall attend a training program, not less than one hour in
length administered by the Ethics Officer, during which the terms and conditions
of the Code of Business Ethics will be reviewed, and thereafter each new employee
shall be required to read the Code and sign the register stating that he or she
has read and understood the Code.




 


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	 	d.	 	GTSI agrees to institute and shall maintain an information and
education
program designed to assure that all employees are aware of all applicable laws,
regulations, and standards of business conduct that employees are expected to
follow, including without limitation with respect to small business procurement,
and the consequences both to the employee and to the company that will ensue from
any violation of such measures. Training shall consist of compliance training for
affected employees, plus at least one hour of live initial training in the GTSI
business ethics program for every GTSI employee, plus, each year for each
then-current employee, not less than one additional hour of live ethics training.
A schedule and subject outline for the information and education program shall be
provided to SBA within thirty days of the date of this Agreement and, when
presented to SBA, shall be deemed incorporated by reference into this Agreement






	 	e.	 	All written materials and training related to the business ethics
program will be provided in English and in any other language necessary to ensure
that each employee understands all elements of any written and oral presentation.






	 	f.	 	GTSI agrees to post in prominent places accessible to each of its
employees a notice giving the telephone numbers of GTSI’s Ethics Officer, and
inviting confidential calls to report suspected instances of improper conduct,
providing instructions that encourage employees to make such reports, noting that
the caller may call a third-party 800 reporting number which will accept
anonymous calls, and stating the company’s commitment to comply with all
applicable laws and regulations in the conduct of its business. GTSI will provide
a copy of this notice to SBA within thirty days, and when provided to SBA, shall
be deemed incorporated by reference into this Agreement. All calls and
information received by the Ethics Officer shall promptly be reported by said
Officer to the Monitor, who shall promptly report such calls and information to
SBA.






	 	g.	 	Each employee of GTSI will be subject to an annual certification
requirement to attest that he or she (a) has attended a live training session
concerning the content and application of the company’s business ethics program;
(b) understands that strict adherence to the law, the Code of Business Ethics, and
the principles of the business ethics program is a condition of employment; and
(c) understands that GTSI will take disciplinary action, including discharge, for
any violation of law, the Code of Business Ethics, the principles of the business
ethics program, or basic tenets of business honesty and integrity, or failure to
take reasonable steps to prevent or detect improper conduct. The certificates
shall be maintained and available for the SBA’s review and inspection during the
life of this Agreement.




 


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	 	h.	 	The Board of Directors of GTSI shall be responsible for ensuring
that the company establishes a business ethics program and that the Code of
Business Ethics is maintained and updated as necessary, as well as
providing for periodic audits of GTSI’s business practices, procedures, policies
and internal controls for compliance with this Agreement, and the special
requirements of Government contracting, including monitoring and auditing to
detect criminal conduct, periodic evaluation of the effectiveness of the business
ethics program and periodic assessment of the risk of criminal conduct, with
appropriate steps to design, implement or modify the business ethics program as
necessary to reduce the risk of criminal conduct as identified through this
process. GTSI’s Ethics Officer shall report to the Board of Directors in person
and in writing not less than quarterly concerning GTSI’s Ethics Program and
compliance with this Agreement. The Board of Director’s shall take whatever
actions are appropriate and necessary to ensure that GTSI conducts its activities
in compliance with the requirements of the law and sound business ethics.






	 	i.	 	At least once each calendar year, GTSI shall conduct an internal
audit of GTSI’s business practices, procedures, policies, and internal controls
for compliance with this Agreement, the Code of Business Ethics, and the special
requirements of Government contracting, including monitoring and auditing to
detect criminal conduct and other conduct violating Federal law or regulations,
periodic evaluation of the effectiveness of the business ethics program and
periodic assessment of the risk of criminal conduct, with appropriate steps to
design, implement or modify the business ethics program as necessary to reduce
the risk of criminal conduct as identified through this process. The results of
the audits (which will be done independently of its Ethics Officer) shall be
furnished to SBA and Monitor.





11. In addition to any other right SBA may have by statute, regulation, or contract, SBA or
its duly authorized representative may examine GTSI’s books, records, and other company documents
and supporting materials for the purpose of verifying and evaluating: (a) GTSI’s compliance with
the terms of this Agreement; (b) GTSI’s business conduct in its dealings with all of its customers,
including the Government; (c) GTSI’s compliance with Federal laws, regulations, and procurement
policies and with accepted business practices; and (d) GTSI’s compliance with the requirements of
Government contracts or subcontracts. The materials described above shall be made available by
GTSI at all reasonable times for inspection, audit, or reproduction. Further, for purposes of this
provision, SBA or its authorized representative may interview any GTSI employee at the employee’s
place of business during normal business hours or at such other place and time as may be mutually
agreed between the employee and SBA. Employees will be interviewed without a representative of GTSI
being present. The employee may be represented personally by his own counsel if requested by the
employee.


 


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12. GTSI shall cooperate, to the extent requested by the Government, in any Government
inquiry, investigation, or prosecution relating to its practices and conduct while performing a
Government contract or subcontract. Such cooperation shall include, but not be limited to, taking
all reasonable steps to make available for interviews any current and/or former GTSI officers,
employees or consultants (including current and/or former officers, employees and consultants of
GTSI subsidiaries), to encourage
interviewees to participate fully in those interviews, and to provide documents. In addition,
GTSI agrees to make its current and/or former executives, employees, and consultants (as
appropriate) available to testify on behalf of the Government in any criminal or civil proceeding
arising out of the investigation(s) described above. With respect to GTSI’s efforts regarding
former officers and employees and its consultants (current or former), it is understood that these
individuals may be represented personally by counsel and that GTSI does not have the ability to
require particular behavior by its former officers, employees or any consultants. The obligation
to cooperate under this Agreement is not limited by the term of this Agreement, but will continue
until the Government determines it no longer needs such cooperation, or until GTSI and all of its
subsidiaries are no longer involved in the Government contracting or subcontracting business,
whichever comes first.



13. In addition to any disclosure to the agency Office of the Inspector General and the
contracting officer required by FAR 3.1003(2) and, as applicable, the contract clause set out in
FAR 52.203-13, GTSI shall report to SBA and the Monitor, within 15 days of discovery by management,
any suspected breach of this Agreement or any misconduct that management has reasonable grounds to
believe may constitute a violation of criminal or civil law. The breach or misconduct to be
reported pursuant to this Agreement includes misconduct by any person, including, but not limited
to, GTSI, GTSI’s subcontractors, GTSI’s prime contractors, suppliers, and employees, as defined
herein, and Government employees, when related to the conduct of GTSI’s businesses, and shall
include misconduct disclosed to GTSI from any source relating to GTSI’s business. In addition to
its continuing obligation to notify SBA of all matters referenced hereinabove, GTSI will
investigate (unless expressly directed by SBA or another governmental agency or investigative body
not to do so) all reports of such misconduct that may come to its attention and will promptly
notify SBA of the outcome of such investigations and any potential or actual impact on any aspect
of GTSI’s Government business. GTSI will take corrective action, including prompt restitution of
any harm to the Government. At the commencement of and no less than monthly during the course of
such investigations, GTSI will include summary reports of the status of each such investigation to
SBA.



14. GTSI represents to SBA that, to the best of GTSI’s knowledge, GTSI has disclosed in
writing or in oral communications all criminal or civil investigations of GTSI or its affiliates by
any Governmental entity. GTSI shall notify SBA and the Monitor within two working days of the time
GTSI learns of: (a) the initiation of any additional criminal or civil investigation by any
federal, state, or local government entity involving allegations of Foreign Corrupt Practices Act,
false statements, false claims, corruption, conflict of interest or anti-trust violations or any
other violations of criminal law, if GTSI has reason to believe that it is a target or subject of
such investigation; (b) service of subpoenas by any such governmental entity (except solely to the
extent such notification to SBA would be prohibited by law), if GTSI has reason to believe that it
is a subject or target of the investigation; (c) service of search warrants and/or searches carried
out in any GTSI facility; (d) initiation of legal action against GTSI, or any of its affiliates,
employees, or agents by any entity alleging violations of the Foreign Corrupt Practices Act, false
statements, false claims, corruption, conflict of interest, or anti-trust violations or any other
violations of criminal law; or (e) criminal charges brought by any
governmental entity against GTSI or any of its affiliates, employees, or agents, relating to
the business of GTSI. GTSI shall include in its reporting information for GTSI itself, as well as
for any subsidiary of GTSI that engages in Government contracting or subcontracting, as defined in
FAR 9.403. GTSI shall provide to SBA as much information as necessary to allow SBA to determine
the impact of the investigative or legal activity upon the present responsibility of GTSI for
Government contracting. GTSI shall fully cooperate with any Government agencies responsible for
audits, investigations, or corrective actions.


 


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15. GTSI shall not knowingly employ, with or without pay, an individual who is under
indictment, convicted, pleaded guilty to a crime, or listed by a Federal Agency as debarred,
suspended, or otherwise ineligible for Federal programs. GTSI shall make reasonable inquiry into
the status of any potential employee or consultant. Such reasonable inquiry shall include, at a
minimum, review of the General Services Administration’s (“GSA”) List of Parties Excluded from
Federal Procurement and Non-procurement Programs as maintained by GSA on the internet. The terms
of this Agreement does not require GTSI to terminate the employment of individuals who are indicted
or become suspended or are proposed for debarment during their employment with GTSI. GTSI, however,
will remove such employees from responsibility for or involvement with GTSI’s business affairs
until the resolution of such suspension or proposed debarment. In addition, if any employee of GTSI
is charged with a criminal offense relating to business or otherwise relating to honesty and
integrity, GTSI will remove that employee immediately from responsibility for or involvement with
GTSI’s business affairs. GTSI shall notify SBA of each such personnel action taken, and the
reasons therefore, within 15 days of the action.



16. Aside from GTSI’s corporate relationships that have been disclosed to SBA, GTSI shall not
knowingly form a contract with, purchase from, or enter into any business relationship with any
individual or business entity that is listed by a Federal Agency as debarred, suspended, or
proposed for debarment. GTSI shall make reasonable inquiry into the status of any potential
business partner, to include, at a minimum, review of the GSA’s List of Parties Excluded from
Federal Procurement or Non-procurement Programs including the version of this list maintained by
GSA on the internet. Notwithstanding any other provision of this Agreement, GTSI may enter into a
business relationship with a suspended or debarred contractor, if the CEO first determines in
writing that a compelling reason justifies the action and furnishes to SBA and the Monitor a copy
of the determination not less than 10 days prior to GTSI entering into such a business
relationship. GTSI shall not enter into a business relationship, or continue an existing business
relationship, with a suspended or debarred entity if SBA objects after receiving such notice and
reviewing the matter. In addition to the provisions of this Agreement, GTSI shall comply with the
requirements of FAR 9.405-2(b) and provide to SBA a copy of the documents submitted to the
contracting officer pursuant thereto.



17. GTSI agrees that all costs, as defined in FAR 31.205-47, incurred by, for, or on behalf of
GTSI or any GTSI current or former officer, director, agent, employee, consultant, or affiliate
shall be considered to be expressly unallowable costs, in accordance with the requirements of FAR
31.201-6, for Government contract accounting purposes. Unallowable costs include, but are not limited to, costs arising from, related to, or in
connection with (a) the matters at issue here including the costs of the Monitor provided for
herein, (b) the Government’s criminal and civil investigations regarding the matters at issue here,
and (c) SBA’s independent review of GTSI’s present responsibility, including the costs of the
company’s submissions, presentations, and appearances before SBA. GTSI’s costs of performing and
administering the terms of this Agreement and any fines or penalties levied or to be levied in or
arising out of the matter at issue here are agreed to be expressly unallowable costs. Also
unallowable are GTSI’s costs of bringing


 


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GTSI’s self governance, compliance, and/or ethics programs
to a level acceptable to SBA. GTSI agrees to account separately for such costs. GTSI’s present and
future costs of maintaining, operating, and improving GTSI’s corporate self governance/
compliance/ethics programs are allowable costs for purposes of this Agreement. GTSI recognizes
that in order to comply with the terms of this Agreement, certain costs may need to be
reclassified. As and when required, GTSI shall proceed immediately to identify and reclassify such
costs and, within 90 days of the effective date of this Agreement, GTSI shall adjust any bid rate,
billing rate, or unsettled final indirect cost rate pools to eliminate any costs made unallowable
by this Agreement, and shall advise SBA, the cognizant administrative contracting officer, and the
cognizant Government auditor of the amount and nature of the reclassified costs within 120 days of
the date of this Agreement. SBA or a designated representative shall have the right to audit GTSI’s
books and records to verify compliance with this Agreement. Such audit rights shall be in addition
to any audit rights the Government may have under the terms of any contract with GTSI.



18. GTSI agrees that the resignation of any employee referenced herein was a voluntary action
of the employee. GTSI agrees that the suspension of any employee by GTSI referenced herein was a
voluntary action of GTSI. GTSI shall indemnify and hold the United States and all its agents
and employees harmless, in their official and individual capacities, from any and all claims,
demands, liabilities and damages which any employee or individual may have or may develop in the
future arising from, related to, or in connection with, any resignation or suspension referenced
herein.



19. GTSI’s compliance with the terms and conditions of this Agreement, and each of them, shall
constitute an element of GTSI’s present responsibility for Government contracting. GTSI’s breach of
or failure to meet any of its obligations pursuant to the terms and conditions of this Agreement
constitutes a separate cause for suspension and/or debarment of GTSI. Notwithstanding the
foregoing, and contingent and conditioned upon the continuing, demonstrated truthfulness of GTSI’s
representations and offers made herein, its ongoing, full, timely and complete compliance with this
Agreement and all its obligations hereunder, and its ongoing demonstration of present
responsibility to engage hereafter in all government contracting activities in accordance with
applicable law, SBA agrees that during the term hereof, it shall not re-impose a suspension upon
GTSI based solely upon the existing evidence set forth in the Administrative record alone, without
additional evidence and basis upon which to take such action (including for example any subsequent
breach of this Agreement or violation of law), and considering the entire totality of the
circumstances. By entering into this Agreement, SBA is not determining that GTSI is presently
responsible for any specific Government contract.


 


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20. GTSI will notify all GTSI employees of the fact and substance of this Agreement, the
nature of the conduct leading to this Agreement, and the importance of each employee’s abiding by
the terms of this Agreement and all requirements of law, regulations, and GTSI policies and
procedures.



21. If during the term hereof GTSI (or a successor thereto) sells or in any way transfers the
GTSI business or operations in an asset sale or other asset transaction, or by agreement or
otherwise novates, conveys or transfers control over all or part of its business or operations
(including the performance of its contract rights and obligations) to another entity or person,
including a wholly owned subsidiary, parent or other affiliate of GTSI (or of any successor
thereto), GTSI (or such successor) shall notify the SBA in advance and the successor to or
transferee of such assets, contract rights and obligations, business or operations shall be bound
by the terms and conditions of this Agreement in respect of said GTSI assets, contract rights,
business or operations for the duration of the term hereof. If during the term hereof, GTSI (or a
successor thereto) is a party to a merger or consolidation, the successor entity to such merger or
consolidation, including GTSI, shall remain subject to the terms and conditions of this Agreement
in respect of all GTSI assets, contracts, business or operations for the duration of the term
hereof. No transfer of control or purchase or sale of GTSI’s shares or debt, either in the public
market or otherwise, and no issuance or re-purchase of GTSI shares or debt, either by GTSI or any
successor thereto, shall operate to terminate or vitiate the effectiveness of this Agreement, the
terms, conditions and obligations of which shall continue to bind GTSI and its successors and
assigns with respect to the company, its interests, assets, contracts, business and operations.



22. In the event that GTSI purchases or establishes new business units after the effective
date of this Agreement, all provisions of this Agreement shall forthwith govern and apply to any
such new business unit(s); provided that GTSI shall have 60 days within which to provide to the
employees of such new unit all training and education required herein.



23. GTSI hereby waives all claims, demands, or requests for monies from the Government, of any
kind or of whatever nature, that GTSI and its subsidiaries may have, up through and including the
date hereof, related to, or in connection with, the October 1, 2010 suspension of GTSI, any
investigation or administrative proceedings associated therewith, this Agreement, or the facts that
gave rise to the foregoing. In addition, GTSI shall indemnify and hold the United States and all
its agents and employees harmless, in their official and individual capacities, from any and all
claims, demands, liabilities or damages, or request for any other relief in law or in equity in any
other forum be it judicial or administrative in nature, whether existing prior to the date hereof
or at any time in the future, which related or relates to, or arose or arises in connection with,
the October 1, 2010 suspension of GTSI, any ongoing investigation or administrative or other
proceedings associated therewith, this Agreement or its performance, or the facts that gave or give
rise to the foregoing.


 


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24. GTSI and its subsidiaries hereby release the United States, its instrumentalities, agents,
and employees in their official and personal capacities, of any and all liability or claims, up
through and including the date hereof, arising out of or related to the investigation, or civil
settlement at issue here, or the suspension, proposed debarment, or
debarment of GTSI or any of its subsidiaries or the discussions leading to this Agreement. In
addition, GTSI shall indemnify and hold the United States, its instrumentalities, and all its
agents and employees harmless, in their official and individual capacities, from any and all
claims, demands, liabilities or damages, whether arising prior to the date hereof or at any time in
the future, which related or relates to, or arose or arises in connection with, any past or ongoing
investigation or administrative or judicial proceedings or other action whatsoever, or the civil
settlement at issue here, or the past or any future suspension, proposed debarment, or debarment of
GTSI or any of its subsidiaries, or the discussions leading to this Agreement.



25. This Agreement may be executed in one or more counterparts, each of which shall be an
original, but all of which taken together, shall constitute one and the same agreement.



26. GTSI represents that all written materials and other information supplied to SBA by its
authorized representative during the course of discussions with SBA preceding this Agreement are
true and accurate, to the best information and belief of the GTSI signatories to this Agreement.
GTSI understands that this Agreement is executed on behalf of SBA in reliance upon the truth,
accuracy, and completeness of all such representations.



27. This Agreement constitutes the entire agreement between the parties and supersedes all
prior agreements and understandings, whether oral or written, relating to the subject matter
hereof. This Agreement shall be binding upon and inure to the benefit of and be
enforceable by the parties hereto and their respective successors and assigns.



28. GTSI shall not use any term of this Agreement or the fact of the existence of this
Agreement for any purpose related to the defense or litigation of, or in mitigation of any
criminal, civil, or administrative investigation or proceeding.



29. Bankruptcy proceedings shall not affect the enforcement of this Agreement in the interests
of the Government.



30. GTSI represents and agrees that the person signing on its behalf below is authorized to
execute this Agreement and has the authority to bind GTSI to all terms and conditions herein.



31. The terms of this Agreement in no way restrict SBA’s ability, powers, rights and
discretion to exercise any of its regulatory, enforcement or oversight functions with respect to
any government contract or procurement matter whatsoever, including without limitation any such
matter relating to GTSI and its subsidiaries. This includes any authority available to SBA
pursuant to statute and regulations, and it includes but is not limited to the ability of SBA to
file a size protest pursuant to 13 C.F.R. Part 121. 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
other provisions of this Agreement.


 


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32. Time is of the essence of this Agreement and with respect to the performance of,
compliance with, and receipt of the benefit of, all rights, duties and
obligations hereunder. If, pursuant to any request by GTSI, in any particular circumstance,
SBA provides GTSI additional time to comply with any specific deadline hereunder, such decision by
SBA shall not act as a waiver or modification of this provision; nor shall it diminish or limit the
application of this provision or of any deadline herein or SBA’s right to timely performance, in
any other circumstance or situation during the term hereof.



IN WITNESS WHEREOF, this Agreement has been duly executed as of the date first written above.



	 	 	 	 	 	 	 	 	 
	UNITED STATES SMALL BUSINESS	 	GTSI CORP.	 	 
	ADMINISTRATION	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	 	 	By:	 	 	 	 
	 

	 	 

	 	 	 	 

	 	 
	Print Name:

	 	 	 	Print Name:	 	 	 	 
	 

	 	 

	 	 	 	 

	 	 
	Title:

	 	 	 	Title:	 	 	 	 
	 

	 	 

	 	 	 	 

	 	 







 


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