Document:

Registration Rights Agr

    Exhibit
      10.42

    

      REGISTRATION
        RIGHTS AGREEMENT

      

      

      This
        Registration Rights Agreement (“Agreement”)
        is entered into as of June 29, 2007, between BPO Management Services, Inc.,
        a
        Delaware corporation with offices at 19800 MacArthur Blvd, Suite 820, Irvine,
        CA
        92612 (the “Company”),
        and Donald C. Helt and Bridget B. Helt, as trustees of the Donald C. and
        Bridget
        B. Helt Revocable Trust dated April 24, 2003 (the “Helts”).

       

      W I T N E S S E T H:

      

      WHEREAS,
        the
        Company has issued shares of the common stock, $.01 par value per share of
        the
        Company (the “Common
        Stock”)
        to the Helts, in connection with the purchase by the Company of all of the
        issued and outstanding common stock of Human Resource Micro-Systems, Inc.,
        a
        California corporation (“Target”)
        pursuant to the terms of a Stock Purchase Agreement of even date herewith
        (the
“Purchase
        Agreement”);

       

      WHEREAS,
        the Company has agreed to provide to the Helts certain registration rights
        as
        set forth herein;

       

      NOW,
        THEREFORE,
        in consideration of the mutual promises, representations, warranties, covenants
        and conditions set forth in the Purchase Agreement and this Agreement, the
        Company and the Helts agree as follows:

       

      1. Certain
        Definitions.
        Unless defined herein, capitalized terms used herein and not otherwise defined
        shall have the meaning ascribed thereto in the Purchase Agreement. As used
        in
        this Agreement, the following terms shall have the following respective
        meanings:

       

      “Closing
        Date”
        shall have the meaning ascribed to it in the Purchase Agreement.

       

      “Commission”
        or “SEC”
        shall mean the Securities and Exchange Commission or any other federal agency
        at
        the time administering the Securities Act.

       

      “Exchange
        Act”
        shall mean the Securities Exchange Act of 1934, as amended.

       

      “Holder”
        and “Holders”
        shall include the Helts and any permitted transferee or transferees of
        Registrable Securities (as defined below).

       

      The
        terms “register,”
        “registered”
        and “registration”
        shall refer to a registration effected by preparing and filing a registration
        statement in compliance with the Securities Act and applicable rules and
        regulations thereunder, and the declaration or ordering of the effectiveness
        of
        such registration statement.

       

      “Registrable
        Securities”
        shall mean: (i) the shares of Common Stock issued to the Helts under the
        Purchase Agreement, (ii) securities issued or issuable upon any stock split,
        stock dividend, recapitalization or similar event with respect to the foregoing;
        and (iii) any other security issued as a dividend or other distribution with
        respect to, in exchange for or in replacement of the securities referred
        to in
        the preceding clauses; provided that all such shares shall cease to be
        Registrable Securities at the earlier of such times as (A) they have been
        sold under a Registration Statement or pursuant to Rule 144 under the Securities
        Act, or (B) they are eligible to be sold pursuant to Rule 144(k) under the
        Securities Act. 

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      “Registration
        Expenses”
        shall mean all expenses, exclusive of underwriting discounts and commissions,
        to
        be incurred in connection with each Holder’s registration rights under this
        Agreement, including, without limitation, all registration and filing fees,
        printing expenses, fees and disbursements of counsel for the Company, blue
        sky
        fees and expenses, and the expense of any special audits incident to or required
        by any such registration (but excluding the compensation of regular employees
        of
        the Company, which shall be paid in any event by the Company). 

       

      “Registration
        Statement”
        shall have the meaning set forth in Section 2(a) herein.

       

      “Regulation
        D”
        shall mean Regulation D as promulgated pursuant to the Securities Act, and
        as
        subsequently amended.

       

      “Securities
        Act”
        or “Act”
        shall mean the Securities Act of 1933, as amended.

       

      “Selling
        Expenses”
        shall mean all underwriting discounts and selling commissions applicable
        to the
        sale of Registrable Securities.

       

      2. Registration
        Requirements.
        The Company shall use all reasonable efforts
        to effect the registration of the Registrable Securities (including, without
        limitation, the execution of an undertaking to file post-effective amendments,
        appropriate qualification under applicable blue sky or other state securities
        laws and appropriate compliance with applicable regulations issued under
        the
        Securities Act) as soon as practicable after the Closing Date, and in any
        event
        not later than one year after
        the Closing Date, as would permit or facilitate the sale or distribution
        of all
        the Registrable Securities in the manner (including manner of sale) and in
        all
        states reasonably requested by the Holder. Such reasonable efforts by the
        Company shall include, without limitation, the following:

       

      (a)The
        Company shall, as expeditiously as possible:

       

      (i) Prepare
        and file a registration statement with the Commission pursuant to Rule 415
        under
        the Securities Act on Form SB-2 under the Securities Act (or in the event
        that
        the Company is ineligible to use such form, such other form as the Company
        is
        eligible to use under the Securities Act provided that such other form shall
        be
        converted into an SB-2 as soon as Form SB-2 becomes available to the Company)
        covering resales by the Holders as selling stockholders (not underwriters)
        of
        the Registrable Securities (“Registration
        Statement”).
        The
        Company shall use all reasonable efforts to cause such Registration Statement
        and other filings to be declared effective as soon as practicable. Without
        limiting the foregoing, the Company will promptly respond to all SEC comments,
        inquiries and requests, and shall request acceleration of effectiveness at
        the
        earliest possible date.

       

      
        
           

        

        
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      (ii) Prepare
        and file with the SEC such amendments and supplements to such Registration
        Statement and the prospectus used in connection with such Registration Statement
        as may be necessary to comply with the provisions of the Securities Act with
        respect to the disposition of all securities covered by such Registration
        Statement and notify the Holders of the filing and effectiveness of such
        Registration Statement and any amendments or supplements.

       

      (iii) As
        soon
        as practicable after the effectiveness of the Registration Statement or the
        filing date of any amendments or supplements, as the case may be, furnish,
        by
        email to the respective email addresses set forth on the signature pages
        hereto,
        to each Holder that has Common Stock included in the Registration Statement
        such
        numbers of copies of a current prospectus conforming with the requirements
        of
        the Securities Act, copies of the Registration Statement, any amendment or
        supplement thereto and any documents incorporated by reference therein and
        such
        other documents as such Holder may reasonably request in order to facilitate
        the
        disposition of Registrable Securities owned by such Holder. 

       

      (iv) Register
        and qualify the securities covered by such Registration Statement under the
        securities or “Blue Sky” laws of all domestic jurisdictions; provided that the
        Company shall not be required in connection therewith or as a condition thereto
        to qualify to do business or to file a general consent to service of process
        in
        any such states or jurisdictions.

       

      (v) Notify
        promptly each Holder that has Registrable Securities included in the
        Registration Statement of the happening of any event (but not the substance
        or
        details of any such event) of which the Company has knowledge as a result
        of
        which the prospectus (including any supplements thereto or thereof) included
        in
        such Registration Statement, as then in effect, includes an untrue statement
        of
        material fact or omits to state a material fact required to be stated therein
        or
        necessary to make the statements therein not misleading in light of the
        circumstances then existing (each an “Event”),
        and
        use all reasonable efforts to promptly update and/or correct such prospectus.
        Each Holder will hold in confidence and will not make any disclosure of any
        such
        Event and any related information disclosed by the Company. 

       

      (vi) Notify
        each Holder of the issuance by the Commission or any state securities commission
        or agency of any stop order suspending the effectiveness of the Registration
        Statement or the threat or initiation of any proceedings for that purpose.
        The
        Company shall use its best efforts to prevent the issuance of any stop order
        and, if any stop order is issued, to obtain the lifting thereof at the earliest
        possible time.

       

      (vii) List
        the
        Registrable Securities covered by such Registration Statement with all
        securities exchange(s) and/or markets on which the Common Stock is then listed
        and prepare and file any required filings with the Over The Counter Bulletin
        Board (the “OTCBB”),
        if
        any, or any other exchange or market where the Common Stock is
        traded.

       

      
        
           

        

        
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      (viii) Take
        all
        steps reasonably necessary to enable Holders to avail themselves of the
        prospectus delivery mechanism set forth in Rule 153 (or successor thereto)
        under
        the Act.

       

      (b)
        Notwithstanding
        the obligations under Section 2(a)(v) or any provision of this Agreement,
        if (i)
        in the good faith judgment of the Company, following consultation with legal
        counsel, it would be detrimental to the Company and its stockholders for
        resales
        of Registrable Securities to be made pursuant to the Registration Statement
        due
        to the existence of a material development or potential material development
        involving the Company that the Company would be obligated to disclose in
        the
        Registration Statement, which disclosure would be premature or otherwise
        inadvisable at such time or would have a material adverse effect upon the
        Company and its stockholders, or (ii) in the good faith judgment of the Company,
        it would adversely affect or require premature disclosure of the filing of
        a
        Company-initiated registration of any class of its equity securities, then
        the
        Company will have the right to suspend the use of the Registration Statement
        for
        two periods of not more than 30 calendar days each in any 12 month period,
        but
        only if the Company reasonably concludes, after consultation with outside
        legal
        counsel, that the failure to suspend the use of the Registration Statement
        as
        such would create a material liability or violation under applicable securities
        laws or regulations. In any event in which the Company suspends use of the
        Registration Statement pursuant to this paragraph, the Company shall furnish
        to
        the Holders a certificate signed by the Chief Executive Officer of the Company
        stating the Company’s good faith judgment as set forth in clauses (i) and/or
        (ii) of the foregoing sentence; the Company shall (A) use all reasonable
        efforts to lift the suspension at the earliest practicable time; (B) extend
        the period of effectiveness for the Registration Statement for each day of
        suspension; and (C) deliver written notice to the Holders when such
        suspension is no longer necessary, within the periods permitted hereby.

       

      (c)
        If
        at any time subsequent to the date such Registration Statement is declared
        effective, the number of shares of Common Stock registered for resale pursuant
        to the Registration Statement is not equal to at least 100% of the Registrable
        Securities, the Company shall amend the Registration Statement to add such
        additional securities. In the event that the Company is unable under the
        securities laws to add such additional securities to the then effective
        Registration Statement, the Company shall promptly file, in accordance with
        the
        procedures set forth herein, an additional Registration Statement with respect
        to such newly Registrable Securities. The Company shall use all reasonable
        efforts to cause any such additional Registration Statement, when filed,
        to
        become effective as soon as practicable after that date that the need to
        file
        the Registration Statement arose. 

       

      (d)
        Subject
        to any preexisting rights granted to others by the Company, if at any time
        during the term of this Agreement, the registration statement described in
        Section 2(a) is not effective with respect to some or all of the Registrable
        Securities, each Holder shall have the following “piggyback” registration
        rights, provided that such “piggyback” registration rights shall be exercisable
        only pari passu with similar rights provided under any other registration
        rights
        agreements binding on the Company. If the Company at any time following the
        Closing Date proposes for any reason to register Common Stock under the
        Securities Act (other than registrations relating to employee benefit plans,
        business combinations or other registrations on Form S-4 or Form S-8 promulgated
        under the Securities Act or any successor forms thereto), it shall promptly
        give
        written notice to each Holder of its intention to so register such equity
        securities and, upon the written request, given within 20 calendar days after
        delivery of such notice by the Company, of such Holder to include in such
        registration Registrable Securities held by such Holder (which request shall
        specify the number of Registrable Shares proposed to be included in such
        registration by such Holder and shall state the intended method of disposition
        of such Registrable Securities by such Holder), the Company shall use its
        best
        efforts to cause all such Registrable Securities to be included in such
        registration on the same terms and conditions as the securities otherwise
        being
        sold in such registration; provided, however, that the Company shall have
        the
        right to delay such a registration under customary circumstances for a period
        not in excess of 90 calendar days in any twelve month period and if the managing
        underwriter advises the Company in writing that the inclusion of all Registrable
        Securities proposed to be included in such registration would interfere
        materially with the successful marketing (including pricing) of primary shares
        (the “Primary
        Shares”)
        proposed to be registered by the Company, then the number of Primary Shares
        and
        Registrable Securities proposed to be included in such registration shall
        be
        included in the following order:

       

      
        
           

        

        
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      (i) first,
        the Primary Shares; and

      

      (ii) second,
        the Registrable Securities requested to be included in such registration
        pursuant to this Section 2(d) on a pari passu basis with the securities of
        other
        holders with “piggyback” registration rights;

      

      provided,
        that in the case of any such underwritten offering of Common Stock by the
        Company that is in satisfaction of a demand registration pursuant to
        Section 2(e), the order for inclusion of Primary Shares and Registrable
        Securities shall be as set forth in that section. 

      

      (e)
        If
        at any time during the period beginning one year after the Closing Date and
        ending two years after the Closing Date, the registration statement described
        in
        Section 2(a) is not effective with respect to some or all of the Registrable
        Securities, Holders who collectively hold more than $50,000 in value of the
        Registrable Securities (determined as of the Closing Date) shall have the
        following demand registration rights. If the Company shall be requested in
        writing by an eligible Holder, or eligible Holders, to effect a registration
        on
        Form S-1, or on Form SB-2 if the Company is so eligible, under the
        Securities Act of Registrable Securities, then the Company shall promptly
        use
        all reasonable efforts to effect such registration under the Securities Act
        of
        such Registrable Securities which the Company has been so requested to register
        in the manner described in Section 2(a); provided, however, that the Company
        shall not be obligated to effect any registration under this Section 2(e)
        except
        in accordance with the following provisions:

       

      (i) The
        Company shall not be obligated to file and cause to become effective (x)
        more
        than two
        registration statements on Form S-1 or Form SB-2 with respect to
        Registrable Securities initiated by the Holders pursuant to this
        Section 2(e); or (y) any registration statement covering less than $50,000
        in value of Registrable Securities determined as of the Closing Date;

       

      
        
           

        

        
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      (ii) The
        Company may delay the filing or effectiveness of any registration statement
        pursuant to this Section 2(e) for a period of up to 60 calendar days after
        the date of a request for registration pursuant to this Section 2(e) if the
        Company determines in good faith that (A) it is in possession of material,
        non-public information concerning an acquisition, merger, recapitalization,
        consolidation, reorganization or other material transaction by or of the
        Company
        or concerning pending or threatened litigation and (B) disclosure of such
        information would jeopardize any such transaction or litigation or otherwise
        materially harm the Company; provided,
        however,
        that the Company may not exercise such deferral right more than twice in
        any
        twelve month-period.

      

      (f) At
        such time as the Company shall have qualified for the use of Form S-3
        promulgated under the Securities Act or any successor form thereto, the Holders
        shall have the right to request in writing registrations on Form S-3 or such
        successor form of Registrable Shares held by the Holders in the manner described
        in Section 2(a), which request or requests shall (i) specify the number of
        Registrable Shares held by the requesting Holders intended to be sold or
        disposed of, (ii) state the intended method of disposition of such Registrable
        Shares held by the Holders and (iii) relate to Registrable Shares having
        an
        anticipated aggregate offering price of at least $50,000 in value of Registrable
        Securities determined as of the Closing Date. A requested registration on
        Form
        S-3 or any such successor form in compliance with Section 4 shall not count
        as a
        registration statement initiated pursuant to Section 2(e) but shall otherwise
        be
        treated as a registration statement initiated pursuant to, and shall, except
        as
        otherwise expressly provided in Section 4, be subject to Section 2. In
        no event will any Holder be entitled to demand any registration on Form S-3
        if
        the registration would require filing under Blue Sky or similar state securities
        laws in any jurisdiction in which the Company would be required to qualify
        to do
        business or execute a general consent to service of process to effect such
        registration and filing.

      

      (g) With
        a view to making available to the Holders the benefit of certain SEC rules
        and
        regulations which may permit the sale of the Registrable Securities to the
        public without registration, the Company agrees to use all reasonable efforts
        to: 

      

      (i) make
        and keep public information available, as those terms are understood and
        defined
        in Rule 144 under the Securities Act so long as the Company remains subject
        to
        the periodic reporting requirements under Sections 13 or 15(d) of the
        Exchange Act;

      

      (ii) file
        with the SEC, in a timely manner, all reports and other documents required
        of
        the Company under the Exchange Act; and

      

      (iii) so
        long as a Holder owns any Registrable Securities, furnish to such Holder
        forthwith upon request: (A) a written statement by the Company as to the
        Company’s compliance with the reporting requirements of Rule 144 under the
        Securities Act and of the Exchange Act; (B) a copy of the most recent
        annual or quarterly report of the Company; and (C) such other reports and
        documents as a Holder may reasonably request in availing itself of such SEC
        rule
        or regulation allowing the Holder to sell any such securities without
        registration.

       

      
        
           

        

        
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      (h) Subject
        to any preexisting rights granted to others by the Company, the Company shall
        not grant to any person other than the Holders, whether by agreement or
        otherwise, any registration rights that are senior and/or superior to the
        rights
        conferred upon the Holders hereunder
        (“Senior Registration Rights”),
        unless the Company simultaneously grants to the Holders such Senior Registration
        Rights, without requiring any consideration therefor from the Holders;
provided,
        however that this Section 2(h) shall not apply to any issuance by the Company
        of
        securities with Senior Registration Rights, in a bona fide single transaction,
        if the Company receives, in consideration for such issuance, an aggregate
        amount
        of cash and/or property (valued at its fair market value) that exceeds
        $1,000,000. 

      

      3. Expenses
        of Registration.
        All Registration Expenses in connection with any registration, qualification
        or
        compliance with registration pursuant to this Agreement shall be borne by
        the
        Company, and all Selling Expenses of a Holder shall be borne by such
        Holder.

       

      4. Registration
        on Form SB-2.
        The Company shall use its reasonable best efforts to continue to meet the
        “registrant eligibility” requirements for a secondary offering set forth in the
        general instructions to Form SB-2 or any comparable or successor form or
        forms,
        or in the event that the Company is ineligible to use such form, such form
        as
        the Company is eligible to use under the Securities Act, provided that if
        such
        other form is used, the Company shall convert such other form to a Form SB-2
        as
        soon as the Company becomes so eligible.

       

      5. Registration
        Period.
        In the case of any registration effected by the Company pursuant to this
        Agreement, the Company shall keep such registration effective and current
        until
        the earlier of (a) the date on which all the Holders have completed the sales
        or
        distribution described in the Registration Statement relating thereto or,
        if
        earlier until such Registrable Securities may be sold by the Holders under
        Rule
        144(k) under the Securities Act (provided that the Company’s transfer agent has
        accepted an instruction from the Company to such effect) or (b) the the
        second anniversary of the Closing Date.

       

      6. Indemnification.
        

       

      (a)
        Company
        Indemnity.
        The Company will indemnify and hold harmless each Holder, each of its officers,
        directors, agents and partners, and each person controlling each of the
        foregoing, within the meaning of Section 15 of the Securities Act and the
        Exchange Act and the rules and regulations thereunder with respect to which
        registration, qualification or compliance has been effected pursuant to this
        Agreement, and each underwriter, if any, and each person who controls, within
        the meaning of Section 15 of the Securities Act and the rules and regulations
        thereunder, any underwriter, against all claims, losses, damages and liabilities
        (or actions in respect thereof) arising out of or based on any untrue statement
        (or alleged untrue statement) of a material fact contained in any final
        prospectus (as amended or supplemented if the Company files any amendment
        or
        supplement thereto with the SEC), Registration Statement filed pursuant to
        this
        Agreement or any post-effective amendment thereof or based on any omission
        (or
        alleged omission) to state therein a material fact required to be stated
        therein
        or necessary to make the statements therein not misleading in light of the
        circumstances under which they were made, or any violation by the Company
        of the
        Securities Act, the Exchange Act, any state securities law, or any rule or
        regulation thereunder applicable to the Company and relating to action or
        inaction required of the Company in connection with any such registration,
        qualification or compliance, and will reimburse each Holder, each of its
        officers, directors, agents and partners, and each person controlling each
        of
        the foregoing, for any reasonable legal fees and any other expenses reasonably
        incurred in connection with investigating and defending any such claim, loss,
        damage, liability or action, provided that the Company will not be liable
        in any
        such case to a Holder to the extent that any such claim, loss, damage, liability
        or expense arises out of or is based on (i) any untrue statement or omission
        based upon written information furnished to the Company by such Holder and
        stated to be specifically for use therein, (ii) any failure by any Holder
        to
        comply with prospectus delivery requirements of the Securities Act or Exchange
        Act or any other law or legal requirement applicable to the Holders or this
        Agreement or (iii) an offer of sale of Common Stock occurring during a period
        in
        which sales under the Registration Statement are suspended as permitted by
        this
        Agreement. The indemnity agreement contained in this Section 6(a) shall not
        apply to amounts paid in settlement of any such loss, claim, damage, liability
        or action if such settlement is effected without the consent of the Company
        (which consent will not be unreasonably withheld).

       

      
        
           

        

        
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      (b)Holder
        Indemnity.
        Each Holder will, severally but not jointly, if Registrable Securities held
        by
        it are included in the securities as to which such registration, qualification
        or compliance is being effected, indemnify and hold harmless the Company,
        each
        of its directors, officers, agents and partners, and any other Holder selling
        securities pursuant to the Registration Statement and any of its directors,
        officers, agents, partners, and any person who controls such stockholder
        within
        the meaning of the Securities Act or Exchange Act and each underwriter, if
        any,
        of the Company’s securities covered by such a Registration Statement, each
        person who controls the Company or such underwriter within the meaning of
        Section 15 of the Securities Act and the rules and regulations thereunder,
        each
        other Holder (if any), and each of their officers, directors and partners,
        and
        each person controlling such other Holder(s) against all claims, losses,
        damages
        and liabilities (or actions in respect thereof) arising out of or based on
        any
        untrue statement (or alleged untrue statement) of a material fact contained
        in
        any such final prospectus (as amended or supplemented if the Company files
        any
        amendment or supplement thereto with the SEC), Registration Statement filed
        pursuant to this Agreement or any post-effective amendment thereof or based
        on
        any omission (or alleged omission) to state therein a material fact required
        to
        be stated therein or necessary to make the statement therein not misleading
        in
        light of the circumstances under which they were made, and will reimburse
        such
        persons for any reasonable legal fees or any other expenses reasonably incurred
        in connection with investigating and defending any such claim, loss, damage,
        liability or action, in each case to the extent, but only to the extent,
        that
        such untrue statement (or alleged untrue statement) or omission (or alleged
        omission) is made in such final prospectus (as amended or supplemented if
        the
        Company files any amendment or supplement thereto with the SEC), Registration
        Statement filed pursuant to this Agreement or any post-effective amendment
        thereof in reliance upon and in conformity with written information furnished
        to
        the Company by such Holder and stated to be specifically for use therein,
        and
        provided that the maximum amount for which such Holder shall be liable under
        this indemnity shall not exceed the net proceeds (after Selling Expenses)
        received by such Holder from the sale of the Registrable Securities pursuant
        to
        the Registration Statement in question. The indemnity agreement contained
        in
        this Section 6(b) shall not apply to amounts paid in settlement of any such
        claims, losses, damages or liabilities if such settlement is effected without
        the consent of such Holder (which consent shall not be unreasonably
        withheld).

       

      
        
           

        

        
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      (c)
        Procedure.
        Each party entitled to indemnification under this Section 6 (the “Indemnified
        Party”)
        shall give written notice to the party required to provide indemnification
        (the
“Indemnifying
        Party”)
        promptly after such Indemnified Party has actual knowledge of any claim as
        to
        which indemnity may be sought, and shall permit the Indemnifying Party to
        participate in and, if the Indemnifying Party so elects, to assume the defense
        of any such claim in any litigation resulting therefrom, provided that counsel
        for the Indemnifying Party, who shall conduct the defense of such claim or
        any
        litigation resulting therefrom, shall be approved by the Indemnified Party
        (whose approval shall not be unreasonably withheld), and the Indemnified
        Party
        may participate in such defense at its own expense, and provided further
        that
        the failure of any Indemnified Party to give notice as provided herein shall
        not
        relieve the Indemnifying Party of its obligations under this Section 6 except
        to
        the extent that the Indemnifying Party is materially and adversely affected
        by
        such failure to provide notice. No Indemnifying Party, in the defense of
        any
        such claim or litigation, shall, except with the consent of each Indemnified
        Party, consent to entry of any judgment or enter into any settlement which
        does
        not include as an unconditional term thereof the giving by the claimant or
        plaintiff to such Indemnified Party of a release from all liability in respect
        to such claim or litigation. Each Indemnified Party shall furnish such
        non-privileged information regarding itself or the claim in question as an
        Indemnifying Party may reasonably request in writing and as shall be reasonably
        required in connection with the defense of such claim and litigation resulting
        therefrom.

       

      7. Contribution.
        If the indemnification provided for in Section 6 herein is held by a court
        of
        competent jurisdiction to be unavailable to an Indemnified Party in respect
        of
        any losses, claims, damages or liabilities referred to herein (other than
        by
        reason of the exceptions provided therein), then each Indemnifying Party,
        in
        lieu of indemnifying such Indemnified Party, shall, to the extent permitted
        by
        applicable law, contribute to the amount paid or payable by such Indemnified
        Party as a result of such losses, claims, damages or liabilities as between
        the
        Company on the one hand and any Holder(s) on the other, in such proportion
        as is
        appropriate to reflect the relative fault of the Company and of such Holder(s)
        in connection with the statements or omissions which resulted in such losses,
        claims, damages or liabilities, as well as any other relevant equitable
        considerations. The relative fault of the Company on the one hand and of
        any
        Holder(s) on the other shall be determined by a court of law by reference
        to,
        among other things, whether the untrue or alleged untrue statement of a material
        fact or omission or alleged omission to state a material fact relates to
        information supplied by the Company or by such Holder(s) and the parties’
relative intent, knowledge, access to information and opportunity to correct
        or
        prevent such statement or omission.

       

      In
        no event shall the obligation of any Indemnifying Party to contribute under
        this
        Section 7 exceed the amount that such Indemnifying Party would have been
        obligated to pay by way of indemnification if the indemnification provided
        for
        under Section 6(a) or 6(b) hereof had been available under the
        circumstances.

       

      The
        Company and the Holders agree that it would not be just and equitable if
        contribution pursuant to this Section 7 were determined by pro rata allocation
        (even if the Holders were treated as one entity for such purpose) or by any
        other method of allocation which does not take account of the equitable
        considerations referred to in the immediately preceding paragraphs. The amount
        paid or payable by an Indemnified Party as a result of the losses, claims,
        damages and liabilities referred to in the immediately preceding paragraphs
        shall be deemed to include, subject to the limitations set forth above, any
        legal or other expenses reasonably incurred by such Indemnified Party in
        connection with investigating or defending any such action or claim.
        Notwithstanding the provisions of this Section, no Holder shall be required
        to
        contribute any amount in excess of the net proceeds (after Selling Expenses)
        received by such Holder from the sale of Registrable Securities pursuant
        to the
        Registration Statement in question. No person guilty of fraudulent
        misrepresentation (within the meaning of Section 11(f) of the Securities
        Act)
        shall be entitled to contribution from any person who was not guilty of such
        fraudulent misrepresentation.

       

      
        
           

        

        
          9

          
            

          

        

        
           

        

      

       

      8. Survival.
        The indemnity and contribution agreements contained in Sections 6 and 7 shall
        remain operative and in full force and effect regardless of (i) any termination
        of this Agreement or the Purchase Agreement, and (ii) the consummation of
        the
        sale or successive resales of the Registrable Securities.

       

      9. Information
        by Holders.
        As a condition to the obligations of the Company to complete any registration
        pursuant to this Agreement with respect to the Registrable Securities of
        each
        Holder, such Holder will furnish to the Company such information regarding
        itself, the Registrable Securities held by it and the intended methods of
        disposition of the Registrable Securities held by it as is reasonably required
        by the Company to effect the registration of the Registrable Securities.
        At
        least five business days prior to the first anticipated filing date of a
        Registration Statement for any registration under this Agreement, the Company
        will notify each Holder of the information the Company requires from that
        Holder
        whether or not such Holder has elected to have any of its Registrable Securities
        included in the Registration Statement.

       

      10. Further
        Assurances.
        Each Holder will cooperate with the Company, as reasonably requested by the
        Company, in connection with the preparation and filing of any Registration
        Statement hereunder, unless such Holder has notified the Company in writing
        of
        such Holder’s irrevocable election to exclude all of such Holder’s Registrable
        Securities from such Registration Statement.

       

      11. Suspension
        of Sales.
        Upon receipt of any notice from the Company under Section 2(a)(v) or 2(b),
        each
        Holder will immediately discontinue disposition of Registrable Securities
        pursuant to the Registration Statement covering such Registrable Securities
        until, as applicable, (i) it receives copies of a supplemented or amended
        prospectus contemplated by Section 2(a)(v) or (ii) the Company advises the
        Holder that a suspension of sales under Section 2(b) has terminated. If so
        directed by the Company, each Holder will deliver to the Company (at the
        expense
        of the Company) or destroy all copies in the Holder’s possession (other than a
        limited number of file copies) of the prospectus covering such Registrable
        Securities that is current at the time of receipt of such notice.

       

      12. Replacement
        Certificates.
        The certificate(s) representing the Registrable Securities held by a Holder
        may
        be exchanged by such Holder at any time and from time to time for certificates
        with different denominations representing an equal aggregate number of Common
        Stock, as reasonably requested by such Holder upon surrendering the same.
        No
        service charge will be made for such registration or transfer or exchange.
        Upon
        receipt by the Company of evidence reasonably satisfactory to it of the loss,
        theft, destruction or mutilation of the certificates for the Common Stock
        of any
        of the foregoing, and, in the case of loss, theft or destruction, of indemnity
        reasonably satisfactory to it, or upon surrender and cancellation of such
        certificate if mutilated, the Company will make and deliver a new certificate
        of
        like tenor and dated as of such cancellation at no charge to the
        holder.

       

      
        
           

        

        
          10

          
            

          

        

        
           

        

      

       

      13. Transfer
        or Assignment.
        Except as otherwise provided herein, this Agreement shall be binding upon
        and
        inure to the benefit of the parties and their successors and permitted assigns.
        The rights granted to each Holder by the Company under this Agreement to
        cause
        the Company to register Registrable Securities, and all other rights granted
        to
        any Holder by the Company hereunder, may be transferred or assigned (in whole
        or
        in part) by such Holder to (i) any partner or retired partner of such Holder,
        if
        such Holder is a partnership, (ii) any family member of such Holder or trust
        for
        the benefit thereof or of such Holder; or (iii) any transferee from such
        Holder
        of shares of Registrable Securities provided such transferee holds at least
        $50,000 in value of the Registrable Securities (determined as of the Closing
        Date); provided
        in each case that (i) the Company is given written notice by the Holder at
        the
        time of or within a reasonable time after such transfer or assignment, stating
        the name and address of said transferee or assignee and identifying the
        securities with respect to which such registration rights are being transferred
        or assigned; and provided further that the transferee or assignee of such
        rights
        agrees in writing to be bound by the registration provisions of this Agreement,
        (ii) such transfer or assignment is not made under the Registration Statement
        or
        Rule 144 under the Securities Act, and (iii) the transferee has provided to
        the Company an investor questionnaire (or equivalent document) evidencing
        that
        the transferee is a “qualified institutional buyer”, as defined in Rule 144A
        promulgated under the Securities Act or an “accredited investor”, as defined in
        Rule 501(a) of Regulation D.

       

      14. Miscellaneous.

       

      (a)Remedies.
        The Company and each Holder acknowledge and agree that irreparable damage
        would
        occur in the event that any of the provisions of this Agreement were not
        performed in accordance with their specific terms or were otherwise breached.
        It
        is accordingly agreed that the parties shall be entitled to an injunction
        or
        injunctions to prevent or cure breaches of the provisions of this Agreement
        and
        to enforce specifically the terms and provisions hereof, this being in addition
        to any other remedy to which any of them may be entitled by law or
        equity.

       

      (b)Notices.
        Any notice or other communication required or permitted to be given hereunder
        shall be in writing by facsimile, mail or personal delivery and shall be
        effective upon actual receipt of such notice. The addresses for such
        communications shall be:

      

        
          	
                  to
                    the Company:

                	
                  BPO
                    MANAGEMENT SERVICES, INC. 

                
	 	
                  Attention:
                    Patrick Dolan and Jim Cortens

                
	 	
                  1290
                    N Hancock Street, Suite 202

                
	 	
                  Anaheim
                    Hills, CA 92807

                
	 	
                  Fax:______________

                
	 	 

        

         

        
          
             

          

          
            11

            
              

            

          

          
             

          

        

         

        
          	
                  with
                    a copy to: 

                	
                  Jack
                    T. Cornman, Esq.

                
	 	
                  Cornman
                    & Swartz

                
	 	
                  19800
                    MacArthur Blvd., Suite 820

                
	 	
                  Irvine,
                    CA 92612

                
	 	
                  Fax:
                    (949) 224 1505

                
	 	 
	
                  If
                    to the Helts, to:

                	
                  Donald
                    C. Helt

                
	 	
                  P.O.
                    Box 622

                
	 	
                  Kentfield,
                    CA 94914-0622

                
	 	 
	
                  with
                    a copy to:

                	
                  Steven
                    R. Harmon

                
	 	
                  Morgan
                    Miller Blair, a Law Corporation

                
	 	
                  1331 N.
                    California Blvd., Suite 200

                
	 	
                  Walnut
                    Creek, CA 94596-4544

                
	 	
                  Fax:
                    (925) 274-7532

                

        

      

       

      Any
        party hereto may from time to time change its address for notices by giving
        at
        least five calendar days’ written notice of such changed address to the other
        parties hereto. 

       

      (c)
        Waivers.
        No waiver by any party of any default with respect to any provision, condition
        or requirement of this Agreement shall be deemed to be a continuing waiver
        in
        the future or a waiver of any other provision, condition or requirement hereof,
        nor shall any delay or omission of any party to exercise any right hereunder
        in
        any manner impair the exercise of any such right accruing to it thereafter.
        

       

      (d)
        Execution
        in Counterparts.
        This Agreement may be executed in two or more counterparts, all of which
        shall
        be considered one and the same agreement, it being understood that all parties
        need not sign the same counterpart.

       

      (e)
        Signatures.
        Facsimile signatures shall be valid and binding on each party submitting
        the
        same.

       

      (f)
        Entire
        Agreement; Amendment.
        This Agreement, together with the Purchase Agreement and the agreements and
        documents contemplated hereby and thereby, contains the entire understanding
        and
        agreement of the parties with respect to the matters contemplated hereby.
        This
        Agreement may not be amended, modified or terminated except by a written
        agreement signed by the Company and all Holders. Any such amendment,
        modification or termination shall be binding upon the Company and the
        Holders.

       

      (g)
        Governing
        Law; Venue.
        This Agreement and the validity and performance of the terms hereof shall
        be
        governed by and construed in accordance with the laws of the State of Delaware
        applicable to contracts executed and to be performed entirely within such
        state.
        The exclusive venue for any legal proceeding with respect to this Agreement
        shall be San Francisco County, California.

       

      (h)
        Jury
        Trial.
        TO THE MAXIMUM EXTENT PERMITTED BY LAW, EACH PARTY HERETO WAIVES THE RIGHT
        TO A
        TRIAL BY JURY.

       

      
        
           

        

        
          12

          
            

          

        

        
           

        

      

       

      (i)
        Titles.
        The titles used in this Agreement are used for convenience only and are not
        to
        be considered in construing or interpreting this Agreement.

       

      (j)
        No
        Strict Construction.
        The language used in this Agreement will be deemed to be the language chosen
        by
        the parties to express their mutual intent, and no rule of strict construction
        will be applied against any party.

       

      
        
           

           

        

        
          13

          
            

          

        

        
           

        

      

      IN
        WITNESS WHEREOF,
        the undersigned have caused this Agreement to be executed as of the date
        first
        written above.

      

      

        
          	 	
                  COMPANY:

                
	 	 
	 	
                  BPO
                    MANAGEMENT SERVICES, INC.

                
	 	 
	 	 
	 	 
	 	
                  By:
                    __________________________________

                
	 	
                  Name: ________________________________

                
	 	
                  Title
                    _________________________________

                
	 	 
	 	
                  HELTS:

                
	 	 
	 	_________________________________
	 	
                  Donald
                    C. Helt, as trustee of the Donald C. 

                
	 	
                  and
                    Bridget B. Helt Revocable Trust dated 

                
	 	
                  April 24,
                    2003

                
	 	 
	 	 
	 	_________________________________
	 	
                  Bridget
                    B. Helt, as trustee of the Donald C. 

                
	 	
                  and
                    Bridget B. Helt Revocable Trust dated 

                
	 	
                  April 24,
                    2003

                

        

      

    

     

     

     

    14Escrow Agr

    Exhibit
      10.43

     

     

     

    

      Escrow
        Agreement

       

      by
        and among

       

      BPO
        Management Services, Inc.,

      Donald
        C. Helt and Bridget B. Helt, as trustees of the Donald C. and Bridget B.
        Helt Revocable Trust dated April 24, 2003 

       

      and

       

      U.S.
        Bank National Association

       

      Dated
        as of June 29, 2007

       

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      ESCROW
        AGREEMENT

       

      THIS
        ESCROW AGREEMENT (this “Agreement”)
        is dated as of the 29th day of June, 2007, by and among BPO Management
        Services, Inc., a Delaware corporation (the “Purchaser”),
        Donald C. Helt and Bridget B. Helt, as trustees of the Donald C. and
        Bridget B. Helt Revocable Trust dated April 24, 2003 (collectively, the
“Sellers”)
        and U.S. Bank National Association, a national banking association (the
“Escrow
        Agent”),
        as escrow agent. The Purchaser and the Sellers are sometimes referred to
        herein,
        collectively, as the “Interested
        Parties.”
        Capitalized terms used but not defined herein shall have the meanings set
        forth
        in the Purchase Agreement (as defined below).

       

      WHEREAS,
        the Purchaser is purchasing from the Sellers the shares of common stock of
        Human
        Resource Micro-Systems, Inc., a California corporation (the “Company”),
        pursuant to a Stock Purchase Agreement dated as of the date hereof, by and
        among
        the Company, the Sellers and the Purchaser (the “Purchase
        Agreement”),
        pursuant to which a portion of the Purchase Price in the amount of $500,000
        has
        been withheld and is to be deposited in escrow as the sole source of payment
        for
        the Deferred Payment pursuant to Section 2(b) of the Purchase Agreement;
        and

       

      WHEREAS,
        the Sellers and Purchaser wish to engage the Escrow Agent to act, and the
        Escrow
        Agent is willing to act, as escrow agent hereunder and, in that capacity,
        to
        hold, administer and distribute the amounts deposited in escrow hereunder
        in
        accordance with, and subject to, the terms of this Agreement;

       

      NOW
        THEREFORE, for valuable consideration, the receipt whereof is hereby
        acknowledged, the parties hereto agree as follows:

       

      
        
          Section
            1.     Deposit
            of Escrow Funds.

        

      

       

      Upon
        the signing of the Purchase Agreement, the Purchaser shall deposit with the
        Escrow Agent in immediately available funds the amount of $500,000 (the
“Escrow
        Funds”)
        (the Escrow Funds together with any investment income or proceeds received
        by
        the Escrow Agent from the investment thereof from time to time pursuant to
        Section 3 below, collectively, the “Escrow
        Property”),
        and the Escrow Agent agrees to hold the Escrow Property in an account
        established with the Escrow Agent (the “Escrow
        Account”),
        and to administer the Escrow Property in accordance with the terms of this
        Agreement. On the date the Escrow Agent receives the Escrow Funds, the Escrow
        Agent will provide a written confirmation of its receipt to the Purchaser
        and
        the Sellers.

       

      
        
          Section
            2.     Claims
            and Payment; Release from Escrow.

        

      

       

      (a) At
        any time prior to 5:00 p.m. (Pacific Time) on the Business Day preceding
        the
        first anniversary of the date of this Agreement (such anniversary date being
        the
“Release
        Date”),
        the Purchaser may deliver to the Escrow Agent and the Sellers written notice,
        in
        the form attached hereto as Exhibit A,
        of a claim for the distribution of some or all of the Escrow Funds (a
“Claim”)
        in satisfaction of any claims of offset Purchaser may have under Section
        8(h) of
        the Purchase Agreement, which states:

       

      (i) the
        facts giving rise to an alleged basis for the Claim; and

       

      
        
           

        

        
          -1-

          
            

          

        

        
           

        

      

       

      (ii) the
        estimated dollar amount of the loss asserted against the Escrow Funds by
        reason
        of the Claim (the “Claimed
        Amount”).

       

      The
        Escrow Agent shall pay to the Purchaser the amount of the Claimed Amount
        from
        the Escrow Funds on the date ten (10) Business Days (as defined below)
        after it receives such written Claim; provided,
        however,
        that the Escrow Agent shall not make such payment, if the Escrow Agent receives
        from the Sellers (with a copy to Purchaser) at least one (1) Business Day
        prior to such payment date a written notice stating the Sellers contest the
        Claim and a detailed description of the nature of the objection (an
“Objection
        Notice”).
        If no such Objection Notice is received, the Sellers shall be deemed to waive
        any rights to object or contest the payment of the amount of the Claimed
        Amount
        to Purchaser from the Escrow Fund. If the Sellers give a timely Objection
        Notice
        to the Escrow Agent that confirms the Claim solely to the extent of an amount
        that is less than the Claimed Amount (the “Undisputed
        Amount”),
        then the Escrow Agent shall pay the Undisputed Amount to the Purchaser and
        retain the remainder of the Claimed Amount until the Escrow Agent receives
        a
        Resolution Notice (as defined below). Except as expressly directed in the
        foregoing sentence, with respect to any Claim regarding which the Sellers
        give a
        timely Objection Notice to the Escrow Agent (a “Disputed
        Claim”),
        the Escrow Agent shall not make any further payment from the Escrow Funds
        until
        receipt of (i) written instructions signed by the Sellers and the
        Purchaser, or (ii) a Resolution Notice (as defined below) (either such
        document being referred to as a “Final
        Resolution”).
        

       

      The
        Interested Parties agree to use good faith, reasonable negotiations to resolve
        any Disputed Claim, for a period of fifteen (15) days after the delivery
        of an
        Objection Notice. If the Disputed Claim is resolved, the Interested Parties
        shall deliver to the Escrow Agent written instructions for payment from the
        Escrow Funds, signed by the Sellers and the Purchaser. If the Disputed Claim
        is
        not so resolved, the Interested Parties agree to finally resolve any Disputed
        Claim through binding arbitration as described in this paragraph. Within
        five (5) Business Days after the conclusion of the negotiation period
        described above, the Purchaser and the Sellers will then mutually select
        a
        single independent arbitrator to resolve the dispute as described below (the
        "Independent
        Arbitrator").
        If
        the parties cannot agree on the identity of the Independent Arbitrator within
        five (5) Business Days of the date of receipt of the Objection Notice, then
        the Independent Arbitrator shall be determined by an arbitrator selected
        by the
        Purchaser and an arbitrator selected by the Sellers. Any dispute related
        to this
        Section 2(a) shall be resolved by binding expedited arbitration under the
        Commercial Arbitration Rules of the American Arbitration Association
        ("AAA")
        in
        effect as of the date of the request for arbitration if filed (the "Rules").
        The
        arbitration shall be held in San Francisco County, California or Orange County,
        California. Costs related to the Independent Arbitrator shall be borne equally
        between the Purchaser and the Sellers. Upon
        the final resolution of any Disputed Claim through the award of an arbitrator,
        as provided for below, directing delivery of the Escrow Funds, any Interested
        Party entitled to receive a payment from the Escrow Funds in accordance with
        such award will deliver to the Escrow Agent and the other Interested Party
        a
        notice in the form attached hereto as Exhibit B
        (a “Resolution
        Notice”).
        The Escrow Agent shall make payment from the Escrow Funds in accordance with
        any
        Resolution Notice within two (2) Business Days of receipt thereof.

       

      For
        purposes of this Agreement, “Business
        Day”
        shall mean any day other than a Saturday or Sunday or a day on which national
        banking institutions in the City of Los Angeles, California are authorized
        or
        obligated by law or executive order to be closed.

       

      
        
           

        

        
          -2-

          
            

          

        

        
           

        

      

       

      (b) The
        Escrow Funds shall be released as follows:

       

      (i) on
        the Release Date (or, if such day is not a Business Day, the next succeeding
        Business Day), the Escrow Agent shall pay Sellers $500,000, less (A) any
        amounts previously paid to Purchaser pursuant to Section 2(a) above, and
        (B) the Claimed Amount with respect to any Disputed Claim(s) as to which
        the Escrow Agent has not received that have not yet been finally resolved;
        

       

      (ii) if
        any Escrow Funds are withheld from the payment described in Section 2(b)(i)
        above, pursuant to clause (B) thereof, then such amount shall be paid by
        the
        Escrow Agent within two (2) Business Days of the Escrow Agent’s receipt of a
        Resolution Notice, in accordance with the instructions set forth in such
        Resolution Notice; and

       

      (iii) if,
        at any time, the Escrow Agent receives written instructions signed by both
        the
        Sellers and the Purchaser with respect to payment of any portion of the Escrow
        Funds, then the Escrow Agent shall pay such amount in the manner set forth
        in
        such instructions within two (2) Business Days of the Escrow Agent’s receipt
        thereof.

       

      
        
          Section
            3.     Investment
            of Funds.

        

      

       

      (a) The
        Escrow Agent shall invest the Escrow Property in the Escrow Agent’s Insured
        Money Market Account (“IMMA”)
        or, if directed by Purchaser, in short term United States Treasury bills.
        The
        Escrow Property and all investments thereof shall be held and, if registrable,
        shall be registered in the name of the Escrow Agent under “Escrow Agreement
        dated June ________, 2007 by and among BPO Management Services, Inc.,
        Donald C. Helt and Bridget B. Helt, as trustees of the Donald C. and
        Bridget B. Helt Revocable Trust dated April 24, 2003 and U.S. Bank National
        Association, as escrow agent.”

       

      (b) All
        earnings received from the investment of the Escrow Funds shall be credited
        to
        and belong solely to the Purchaser and released to Purchaser on the date
        that
        all of the Escrow Funds have been disbursed. The Escrow Agent shall have
        no
        liability for any investment losses, including without limitation any market
        loss on any investment liquidated prior to maturity in order to make a payment
        required hereunder.

       

      (c) The
        Interested Parties agree that, for tax reporting purposes, all interest and
        other income earned from the investment of the Escrow Funds in any tax year
        shall be reported by the Purchaser.

       

      (d) Purchaser
        agrees to provide the Escrow Agent with a certified tax identification number
        by
        signing and returning a Form W-9 (or Form W-8 BEN, in case of non-U.S.
        persons) to the Escrow Agent upon the execution and delivery of this Agreement.
        Purchaser understands that, in the event its tax identification numbers are
        not
        certified to the Escrow Agent, the Internal Revenue Code, as amended from
        time
        to time, may require withholding of a portion of any interest or other income
        earned on the investment from the Escrow Funds. Purchaser agrees to instruct
        the
        Escrow Agent in writing with respect to the Escrow Agent’s responsibility for
        withholding and other taxes, assessments or other governmental charges, and
        to
        instruct the Escrow Agent with respect to any certifications and governmental
        reporting that may be required under any laws or regulations that may be
        applicable in connection with its acting as Escrow Agent under this
        Agreement.

       

      
        
           

        

        
          -3-

          
            

          

        

        
           

        

      

       

      (e) The
        Escrow Agent shall deliver prompt monthly account statements to the Sellers
        and
        the Purchaser with respect to the balance of the Escrow Property and all
        transactions with respect thereto. The Escrow Agent shall respond promptly
        to
        provide information regarding the Escrow Property, upon the reasonable request
        of the Sellers or the Purchaser.

       

      
        
          Section
            4.     Intentionally
            Omitted.

        

      

       

      
        
          Section
            5.     Concerning
            the Escrow Agent.

        

      

       

      (a) Each
        Interested Party acknowledges and agrees that the Escrow Agent (i) shall
        not be responsible for any of the agreements referred to or described herein
        (including, without limitation the Purchase Agreement), or for determining
        or
        compelling compliance therewith, and shall not otherwise be bound thereby,
        (ii) shall be obligated only for the performance of such duties as are
        expressly and specifically set forth in this Agreement on its part to be
        performed, each of which is ministerial (and shall not be construed to be
        fiduciary) in nature, and no implied duties or obligations of any kind shall
        be
        read into this Agreement against or on the part of the Escrow Agent,
        (iii) shall not be obligated to take any legal or other action hereunder
        which might in its judgment involve or cause it to incur any expense or
        liability unless it shall have been furnished with acceptable indemnification,
        (iv) may rely on and shall be protected in acting or refraining from acting
        upon any written notice, instruction (including, without limitation, wire
        transfer instructions, whether incorporated herein or provided in a separate
        written instruction), instrument, statement, certificate, request or other
        document furnished to it hereunder and believed by it in good faith to be
        genuine and to have been signed or presented by the proper person, and shall
        have no responsibility or duty to make inquiry as to or to determine the
        genuineness, accuracy or validity thereof (or any signature appearing thereon),
        or of the authority of the person signing or presenting the same, and (v)
        may
        consult counsel satisfactory to it, including in-house counsel, and the opinion
        or advice of such counsel in any instance shall be full and complete
        authorization and protection in respect of any action taken, suffered or
        omitted
        by it hereunder in good faith and in accordance with the opinion or advice
        of
        such counsel.

       

      (b) The
        Escrow Agent shall not be liable to anyone for any action taken or omitted
        to be
        taken by it hereunder except in the case of the Escrow Agent’s gross negligence
        or willful misconduct in breach of the terms of this Agreement. In no event
        shall the Escrow Agent be liable for indirect, punitive, special or
        consequential damage or loss (including but not limited to lost profits)
        whatsoever, even if the Escrow Agent has been informed of the likelihood
        of such
        loss or damage and regardless of the form of action, unless due to the Escrow
        Agent’s willful misconduct or fraud.

       

      (c) The
        Escrow Agent shall have no more or less responsibility or liability on account
        of any action or omission of any book-entry depository, securities intermediary
        or other subescrow agent employed by the Escrow Agent than any such book-entry
        depository, securities intermediary or other subescrow agent has to the Escrow
        Agent, except to the extent that such action or omission of any book-entry
        depository, securities intermediary or other subescrow agent was caused by
        the
        Escrow Agent’s own gross negligence or willful misconduct in breach of this
        Agreement.

       

      (d) The
        Escrow Agent is hereby authorized, in making or disposing of any investment
        permitted by this Agreement, to deal with itself (in its individual capacity)
        or
        with any one or more of its affiliates, whether it or such affiliate is acting
        as a subagent of the Escrow Agent or for any third person or dealing as
        principal for its own account.

       

      
        
           

        

        
          -4-

          
            

          

        

        
           

        

      

       

      (e) Notwithstanding
        any term appearing in this Agreement to the contrary, in no instance shall
        the
        Escrow Agent be required or obligated to distribute any Escrow Property (or
        take
        other action that may be called for hereunder to be taken by the Escrow Agent)
        sooner than (i) two (2) Business Days after it has received the
        applicable documents required under this Agreement in good form, or
        (ii) passage of the applicable time period or occurrence of the applicable
        distribution date (or both (i) and (ii), as applicable under the terms of
        this
        Agreement), as the case may be.

       

      
        
          Section
            6.     Compensation,
            Expense Reimbursement and Indemnification.

        

      

       

      (a) The
        Purchaser agrees to pay the Escrow Agent’s fees and expenses hereunder in
        accordance with the fee schedule attached hereto as Schedule 1
        and made a part hereof, which may be subject to change hereafter by the Escrow
        Agent on an annual basis. 

       

      (b) The
        Purchaser agrees to reimburse the Escrow Agent on demand for all costs and
        expenses incurred in connection with the administration of this Agreement
        or the
        escrow created hereby or the performance or observance of its duties hereunder
        which are in excess of its compensation for normal services hereunder, including
        without limitation, payment of any legal fees and expenses incurred by the
        Escrow Agent in connection with resolution of any claim by any party
        hereunder.

       

      (c) The
        Purchaser and Sellers agree to indemnify the Escrow Agent (and its directors,
        officers and employees) and hold it (and such directors, officers and employees)
        harmless from and against any loss, liability, damage, cost and expense of
        any
        nature incurred by the Escrow Agent arising out of or in connection with
        this
        Agreement or with the administration of its duties hereunder, including but
        not
        limited to reasonable attorney’s fees and other costs and expenses of defending
        or preparing to defend against any claim of liability (collectively,
“Losses”),
        unless and except to the extent such Losses are caused by the Escrow Agent’s
        gross negligence, or willful misconduct, and except that Purchaser shall
        be
        solely responsible for escrow fees and expenses charged by Escrow Agent under
        Schedule 1 hereunder. 

       

      (d) The
        foregoing indemnification and agreement to hold harmless shall survive the
        termination of this Agreement. 

       

      
        
          Section
            7.     Termination.

        

      

       

      This
        Agreement, and the escrow created hereunder, shall terminate upon the release
        and/or distribution of all amounts comprising the Escrow Property, as provided
        herein, and the fulfillment of all of the Escrow Agent’s obligations
        hereunder.

       

      
        
           

        

        
          -5-

          
            

          

        

        
           

        

      

       

      
        
          Section
            8.     Tax
            Indemnification.

        

      

       

      The
        Purchaser agrees (i) to assume any and all obligations imposed now or hereafter
        by any applicable tax law with respect to any payment or distribution of
        the
        Escrow Property to the Purchaser, or performance of other activities under
        this
        Agreement, (ii) to instruct the Escrow Agent in writing with respect to the
        Escrow Agent’s responsibility for withholding and other taxes, assessments or
        other governmental charges with respect to any payment or distribution of
        the
        Escrow Property to the Purchaser, and to instruct the Escrow Agent with respect
        to any certifications and governmental reporting that may be required under
        any
        laws or regulations that may be applicable in connection with its acting
        as
        Escrow Agent under this Agreement, by virtue of the Purchaser’s status as an
        Interested Party, and (iii) to indemnify and hold the Escrow Agent harmless
        from any liability or obligation on account of taxes, assessments, additions
        for
        late payment, interest, penalties, expenses and other governmental charges
        that
        may be assessed or asserted against the Escrow Agent in connection with,
        on
        account of or relating to the Escrow Property, the management established
        hereby, any payment or distribution of or from the Escrow Property to the
        Purchaser pursuant to the terms hereof or other activities performed under
        the
        terms of this Agreement, including without limitation any liability for the
        withholding or deduction of (or the failure to withhold or deduct) the same,
        and
        any liability for failure to obtain proper certifications or to report properly
        to governmental authorities in connection with this Agreement, including
        costs
        and expenses (including reasonable legal fees and expenses), interest and
        penalties. The Sellers agree (i) to assume any and all obligations imposed
        now
        or hereafter by any applicable tax law with respect to any payment or
        distribution of the Escrow Property to the Sellers, (ii) to instruct the
        Escrow Agent in writing with respect to the Escrow Agent’s responsibility for
        withholding and other taxes, assessments or other governmental charges with
        respect to any payment or distribution of the Escrow Property to the Sellers,
        and to instruct the Escrow Agent with respect to any certifications and
        governmental reporting that may be required under any laws or regulations
        that
        may be applicable in connection with its acting as Escrow Agent under this
        Agreement, by virtue of the Purchaser’s status as an Interested Party, and
        (iii) to indemnify and hold the Escrow Agent harmless from any liability or
        obligation on account of taxes, assessments, additions for late payment,
        interest, penalties, expenses and other governmental charges that may be
        assessed or asserted against the Escrow Agent in connection with, on account of
        or relating to the Escrow Property, the management established hereby, any
        payment or distribution of or from the Escrow Property to the Sellers pursuant
        to the terms hereof or other activities performed under the terms of this
        Agreement, including without limitation any liability for the withholding
        or
        deduction of (or the failure to withhold or deduct) the same, and any liability
        for failure to obtain proper certifications or to report properly to
        governmental authorities in connection with this Agreement, including costs
        and
        expenses (including reasonable legal fees and expenses), interest and penalties.
        The indemnifications and agreements to hold harmless set forth in this Section
        8
        shall survive the termination of this Agreement.

       

      
        
          Section
            9.     Resignation.

        

      

       

      The
        Escrow Agent may at any time resign as Escrow Agent hereunder by giving
        thirty (30) days’ prior written notice of resignation to each of the
        Interested Parties. Prior to the effective date of the resignation as specified
        in such notice, the Purchaser will issue to the Escrow Agent a written
        instruction authorizing redelivery of the Escrow Property to a bank or trust
        company that it selects as successor to the Escrow Agent hereunder, which
        successor shall have been approved in writing by the Sellers prior to such
        instruction by the Purchaser, such approval not to be unreasonably withheld
        or
        delayed. 

       

      
        
           

        

        
          -6-

          
            

          

        

        
           

        

      

       

      
        
          Section
            10.     Dispute
            Resolution.

        

      

       

      It
        is understood and agreed that, should any dispute arise with respect to the
        delivery, ownership, right of possession, and/or disposition of the Escrow
        Property, or should any claim be made upon the Escrow Agent or the Escrow
        Property by a third party, the Escrow Agent upon receipt of notice of such
        dispute or claim is authorized and shall be entitled (at its sole option
        and
        election) to retain in its possession without liability to anyone, all or
        any of
        the Escrow Property until such dispute shall have been settled either by
        the
        mutual written agreement of the parties involved or by a final order, decree
        or
        judgment of a court of competent jurisdiction in the United States of America,
        the time for perfection of an appeal of such order, decree or judgment having
        expired. The Escrow Agent may, but shall be under no duty whatsoever to,
        institute or defend any legal proceedings which relate to the Escrow
        Property.

       

      
        
          Section
            11.     Governing
            Law; Submission to Jurisdiction.

        

      

       

      This
        Agreement shall be governed by and construed in accordance with the laws
        of the
        State of California applicable to agreements made and to be performed entirely
        within such State. Solely for purposes of any actions, suits, or proceedings
        to
        which the Escrow Agent is a party, each party hereby irrevocably and
        unconditionally consents to submit to the exclusive jurisdiction of the courts
        of the State of California or the courts of the United States of America
        located
        in Los Angeles for any actions, suits, or proceedings arising out of or relating
        to this Agreement (and the parties agree not to commence any action, suit,
        or
        proceeding relating thereto except in such courts), and further agrees that
        service of any process, summons, notice, or document by U.S. registered mail
        to
        the respective addresses set forth above shall be effective service of process
        for any action, suit, or proceeding brought against the parties in any such
        court. Solely for purposes of any actions, suits, or proceedings to which
        the
        Escrow Agent is a party, Each party hereby irrevocably and unconditionally
        waives any objection to the laying of venue of any action, suit, or proceeding
        arising out of this Agreement, in the courts of the State of California or
        the
        United States of America located in Los Angeles, and hereby further irrevocably
        and unconditionally waives its right and agrees not to plead or claim in
        any
        such court that any such action, suit, or proceeding brought in any such
        court
        has been brought in an inconvenient forum. For all actions, suits or proceedings
        to which the Escrow Agent is not a party, the parties agree that Section
        10(o)
        of the Purchase Agreement shall govern court jurisdiction. 

       

      
        
          Section
            12.     Waiver
            of Jury Trial.

        

      

       

      TO
        THE EXTENT PERMITTED BY LAW, THE ESCROW AGENT AND THE INTERESTED PARTIES
        HEREBY
        WAIVE A TRIAL BY JURY OF ANY AND ALL ISSUES ARISING IN ANY ACTION OR PROCEEDING
        BETWEEN THEM OR THEIR SUCCESSORS OR ASSIGNS, UNDER OR IN CONNECTION WITH
        THIS
        AGREEMENT OR ANY OF ITS PROVISIONS OR ANY NEGOTIATIONS IN CONNECTION
        HEREWITH.

       

      
        
          Section
            13.     Force
            Majeure.

        

      

       

      The
        Escrow Agent shall not be responsible for delays or failures in performance
        resulting from acts beyond its control. Such acts shall include but not be
        limited to acts of God, strikes, lockouts, riots, acts of war, epidemics,
        governmental regulations superimposed after the fact, fire, communication
        line
        failures, computer viruses, power failures, earthquakes or other
        disasters.

       

      
        
           

        

        
          -7-

          
            

          

        

        
           

        

      

       

      
        
          Section
            14.     Notices;
            Wiring Instructions.

        

      

       

      (a) Notice
        Addresses.
        Any notice permitted or required hereunder shall be in writing, and shall
        be
        sent (i) by personal delivery, overnight delivery by a recognized courier
        or delivery service, or (ii) mailed by registered or certified mail, return
        receipt requested, postage prepaid, or (iii) by confirmed telecopy
        accompanied by mailing of the original on the same day by first class mail,
        postage prepaid, in each case the parties at their address set forth below
        (or
        to such other address as any such party may hereafter designate by written
        notice to the other parties).

       

      If
        to Sellers:

       

      Donald
        C. Helt and Bridget B. Helt, 

      as
        trustees of the Donald C. and Bridget B. Helt 

      Revocable
        Trust dated April 24, 2003

      P.O.
        Box 622

      Kentfield,
        CA 94914-0622

       

      with
        a copy to: 

      

      Steven
        R. Harmon

      Morgan
        Miller Blair, a Law Corporation

      1331
        N. California Blvd., Suite 200

      Walnut
        Creek, CA 94596-4544

      Fax:
        (925) 274-7532

      

       

      If
        to Purchaser:

       

      BPO
        Management Services, Inc. 

      1290
        N. Hancock, Suite 202

      Anaheim,
        CA 92807

      Attention:
        Chief Executive Officer 

      Tel.
        No.: (714) 974-2670

      Fax
        No.: (714) 974-4771

      

      With
        a copy to:

       

      Cornman
        & Swartz

      19800
        MacArthur Blvd., Suite 820

      Irvine,
        CA 92612

      Attention:
        Jack T. Cornman

      Tel.
        No.: (949) 224-1500

      Fax
        No.: (949) 224-1505

      

      
        
           

        

        
          -8-

          
            

          

        

        
           

        

      

      

      If
        to Escrow Agent:

       

      U.S.
        Bank National Association

      Corporate
        Trust Services

      633
        West Fifth Street, 24th
        Floor

      Los
        Angeles, CA 90071

      Attention:
        Brad E. Scarbrough

      Facsimile:
        (213) 615-6197

      Telephone:
        (213) 615-6047

      

      Notwithstanding
        the foregoing, notices addressed to the Escrow Agent shall be effective only
        upon receipt. If any notice or document is required to be delivered to the
        Escrow Agent and any other person, the Escrow Agent may assume without inquiry
        that each notice or document was received by such other person when it is
        received by the Escrow Agent.

       

      (b) Wiring
        Instructions.
        Any funds to be paid by the Escrow Agent to the Sellers, or to the Purchaser,
        or
        to be paid to the Escrow Agent hereunder, shall be sent by wire transfer
        pursuant to such instruction as may have been given in advance and in writing
        to
        or by the Sellers, the Purchaser or the Escrow Agent, as
        applicable.

       

      
        
          Section
            15.     Miscellaneous.

        

      

       

      (a) Binding
        Effect; Successors.
        This Agreement shall be binding upon the respective parties hereto and their
        heirs, executors, successors and assigns. If the Escrow Agent consolidates,
        merges or converts into, or transfers all or substantially all of its corporate
        trust business (including the escrow contemplated by this Agreement) to,
        another
        corporation, the successor corporation without any further act shall be the
        successor Escrow Agent.

       

      (b) Modifications.
        This Agreement may not be altered or modified without the express written
        consent of the parties hereto. No course of conduct shall constitute a waiver
        of
        any of the terms and conditions of this Escrow Agreement, unless such waiver
        is
        specified in writing, and then only to the extent so specified. A waiver
        of any
        of the terms and conditions of this Escrow Agreement on one occasion shall
        not
        constitute a waiver of the other terms of this Escrow Agreement, or of such
        terms and conditions on any other occasion. Notwithstanding any other provision
        hereof, consent to an alteration or modification of this Agreement may not
        be
        signed by means of an e-mail address.

       

      (c) Reproduction
        of Documents.
        This Agreement and all documents relating thereto, including, without
        limitation, (a) consents, waivers and modifications which may hereafter be
        executed, and (b) certificates and other information previously or
        hereafter furnished, may be reproduced by any photographic, photostatic,
        microfilm, optical disk, micro-card, miniature photographic or other similar
        process. The parties agree that any such reproduction shall be admissible
        in
        evidence as the original itself in any judicial or administrative proceeding,
        whether or not the original is in existence and whether or not such reproduction
        was made by a party in the regular course of business, and that any enlargement,
        facsimile or further reproduction of such reproduction shall likewise be
        admissible in evidence.

       

      (d) Counterparts
        and Facsimile Execution.
        This Escrow Agreement may be executed in several counterparts, each of which
        shall be deemed to be one and the same instrument. The exchange of copies
        of
        this Agreement and of signature pages by facsimile transmission shall constitute
        effective execution and delivery of this Agreement as to the parties and
        may be
        used in lieu of the original Agreement for all purposes. Signatures of the
        parties transmitted by facsimile shall be deemed to be their original signatures
        for all purposes.

       

      
        
           

        

        
          -9-

          
            

          

        

        
           

        

      

       

      (e) Severability.
        If one or more provisions of this Agreement are held to be unenforceable
        under
        applicable law, such provision shall be excluded from this Agreement and
        the
        balance of the Agreement shall be interpreted as if such provision were so
        excluded and shall be enforceable in accordance with its terms.

       

      (f) U.S.A.
        Patriot Act Compliance Information.
        The Purchaser and the Sellers each shall provide to the Escrow Agent such
        information as the Escrow Agent may reasonably require to permit the Escrow
        Agent to comply with its obligations under the federal U.S.A. Patriot Act. 
The Escrow Agent shall not credit any amount of interest or investment proceeds
        earned on the Escrow Funds, or make any payment of all or a portion of the
        Escrow Funds, to any person unless and until such person has provided to
        the
        Escrow Agent such documents as the Escrow Agent may require to permit the
        Escrow
        Agent to comply with its obligations under such Act.

       

      [Signature
        Pages to Follow]

       

      
        
           

        

        
          -10-

          
            

          

        

        
           

        

      

      IN
        WITNESS WHEREOF, the parties hereto have executed this Agreement as of this
        29th
        day of June, 2007.

       

       

       

      
        	
                BPO
                  Management Services, Inc. 

                 

                 

                By:__________________________________________

                Name:
                  

                Title:
                  

              	 
	
                ESCROW
                  AGENT:

              	 
	
                U.S.
                  Bank National Association, as Escrow Agent

              	 
	
                 

                 

                By:__________________________________________

                Name:

                Title:

              	 

      

      

       

      

      Trustees
        of the Donald C. and Bridget B. Helt 

      Revocable
        Trust dated April 24, 2003

      

      By:__________________________

      Donald
        C. Helt, Trustee

      By:__________________________

      Bridget
        B. Helt, Trustee

      

       

      

      
        
           

        

        
          -11-

          
            

          

        

        
           

        

      

       

      

      SCHEDULE
        1

       

      

        
          	
                  Initial
                    Fees

                	 
	
                  Acceptance
                    Fee (excluding charge for legal counsel and/or legal
                    opinion)

                	
                  $500.00

                
	 	 
	
                  The
                    acceptance fee includes the administrative review of all documents,
                    initial set-up of the account, and other reasonably required
                    services up
                    to and including the closing. This is a one-time fee, payable
                    at closing.
                    

                	 
	 	 
	
                  U.S.
                    Bank Corporate Trust Services reserve the right to refer any
                    and all
                    escrow documents for legal review before execution. Legal fees
                    (billed on
                    an hourly basis) and expenses for this service will be billed
                    to, and paid
                    by, the customer. If appropriate and upon request by the customer,
                    U.S.
                    Bank Corporate Trust Service will provide advance estimates of
                    these legal
                    fees.

                	 
	 	 
	
                  Investment
                    Purchases

                	
                  $100.00

                
	 	 
	
                  Escrow
                    Agent

                	
                  $1500.00

                
	
                  Annual
                    Administration fee for performance of the routine duties of the
                    escrow
                    agent associated with the management of the account. Administration
                    Fees
                    are payable in advance

                	 
	 	 
	
                  Incidental
                    Expenses

                	
                  0%

                
	
                  Charge
                    for miscellaneous expenses such as fax; messenger service, overnight
                    mail,
                    telephone, stationary and postage. This charge is a percent of
                    total
                    Administration Fees charged in advance

                	 
	 	 
	
                  Direct
                    Out of Pocket Expenses

                	 
	
                  Reimbursement
                    of expenses associated with the performance of our duties, including
                    but
                    not limited to publications, legal counsel after the initial
                    close, travel
                    expenses and filing fees.

                	
                  At
                    Cost

                
	 	 
	
                  Extraordinary
                    Services

                	 
	
                  Extraordinary
                    services are duties or responsibilities of an unusual nature,
                    but not
                    provided for in the governing documents or otherwise set forth
                    in this
                    schedule. A reasonable charge will be assessed based on the nature
                    of the
                    service and the responsibility involved. At our option, these
                    charges will
                    be billed at a flat fee or at our hourly rate then in effect.
                    Examples
                    include:

                	 
	
                  taxpayer
                    ID number solicitation

                	 
	
                  claim
                    distributions

                	 
	
                  execution
                    of amendments/supplement agreements

                	 

        

      

       

       

       

      
        
           

        

        
          -12-

          
            

          

        

        
           

        

      

      EXHIBIT
        A

       

      NOTICE
        OF CLAIM AGAINST ESCROW FUNDS

       

      To: [Escrow
        Agent and Sellers]

       

      This
        certificate is issued pursuant to that certain Escrow Agreement, dated as
        of
        June ___________, 2007, by and among BPO Management Services, Inc., Donald
        C. Helt and Bridget B. Helt, as trustees of the Donald C. and Bridget B.
        Helt Revocable Trust dated April 24, 2003 and U.S. Bank National
        Association. Capitalized terms herein shall have the meaning ascribed to
        them in
        the Escrow Agreement.

       

      The
        undersigned hereby makes a Claim against the Escrow Funds. The nature of
        the
        Claim is as follows:

       

        
          

        

      

       

      
        
 

        

      

       

       

      The
        estimated Claimed Amount is

       

      
        
 

        

      

       

      
        
 

        

       

       

       

       

      
        	 	
                By:
                  __________________________________________________

                Name: 

                Title: 

              

      

      

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      EXHIBIT
        B

       

      RESOLUTION
        NOTICE

       

      TO: [Escrow
        Agent and the Sellers and Purchaser]

       

      This
        Certificate is issued pursuant to that certain Escrow Agreement, dated as
        of
        June _________ 2007, by and among BPO Management Services, Inc., Donald C.
        Helt and Bridget B. Helt, as trustees of the Donald C. and Bridget B. Helt
        Revocable Trust dated April 24, 2003, and U.S. Bank National Association.
        Capitalized terms herein shall have the meaning ascribed to them in the Escrow
        Agreement.

       

      The
        undersigned hereby certifies that (i) it has received an arbitration award
        directing delivery of the Escrow Funds, (ii) a true and correct copy of the
        award accompanies this certificate, and (iii) it is entitled to receive
        payment from the Escrow Funds in the amount set forth below in accordance
        with
        Section 2 of the Escrow Agreement.

       

      You
        are hereby instructed to deliver immediately $________ of the Escrow Property
        held by you to _____________ by wire transfer to the following
        account:

       

      _________________________(Bank)

       

      _________________________(Account)

       

      _________________________(Routing
        Number)

       

      
        	 	
                By: 
                  _______________________________________________

                Name: 

                Title:

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