Deel Legal Hub

The following terms and conditions (hereafter referred to as the “Agreement”) shall govern the relationship between Deel PEO US, LLC, a corporation with its principal place of business at 2600 W. Geronimo Place, Suite 100, Chandler, Arizona 8522 (“PEO”), and the user of the services pursuant to this Agreement (“Client”).

Upon acceptance of this Agreement on the Deel Platform or upon first using the services covered by this Agreement pursuant to this Agreement,, the Client agrees to be bound by its terms.

1. Scope of the Agreement.

The services provided pursuant to this Agreement shall apply only to the Covered Employees. As used in this Agreement, the term Covered Employees shall refer solely to those Client employees occupying the job positions listed in Client’s Schedule A for whom Client has timely submitted new hire paperwork required by PEO, including but not limited to written certification that Client has provided all legally required training regarding job and worksite safety and Client has provided all legally required Personal Protective Equipment (“PPE”), and for whom PEO has acknowledged acceptance in writing. No worker shall be a Covered Employee, nor should any person begin work at the job site, until PEO has processed the new hire paperwork and enrolled such worker as a Covered Employee. PEO has no responsibility for Client employees who are not Covered Employees, or any other worker, laborer or contractor providing services to Client. PEO’s workers’ compensation insurance for Covered Employees is strictly limited to covered claims made by Covered Employees during the Term (as defined below). In the event PEO has more than one workers’ compensation insurance policy, the coverage provided by such policies is strictly limited to that coverage which is specified in the insurance policy documents.

2. Schedules, Addenda And Exhibits.

This Agreement incorporates by reference the terms of any related Schedules, Addenda or Exhibits. References to the Agreement refer to the aggregation of this document and any Schedules, Exhibits and Addenda.

3. Peo Responsibilities.

PEO shall provide the following services with respect to the Covered Employees:

3.1. Compliance With The Law.

PEO shall perform its obligations under this Agreement in compliance with all Federal and State laws and regulations governing Professional Employer Organizations.

3.2. Employee Benefits.

As requested by Client, PEO shall offer certain employee benefits to eligible Covered Employees and their eligible dependents through PEO sponsored plans (“PEO Benefit Plans”) and administer PEO Benefit Plans in compliance with applicable laws and regulations and the terms and provisions of the applicable plan documents. Solely to the extent required by law in order to administer PEO Benefit Plans, PEO retains a right to control, hire and fire the Covered Employees. The applicable plan documents will control eligibility for benefits and the extent of benefits provided under the PEO Benefit Plans. Client will cooperate with PEO in all matters necessary for PEO to properly administer the PEO Benefit Plans, including, without limitation, executing all necessary agreements or other documents. PEO’s obligations with respect to employee benefits will not extend beyond the scope of the PEO Benefit Plans. PEO hereby discloses to Client, and Client understands, that the broker of record for the PEO plans is Insurasource, Inc. (“Insurasource”). Client understands that it is not required to: (i) use Insurasource as its broker regarding any PEO plan or Client Benefit plans; or (ii) participate in a PEO plan, Client Benefit plan, or any other benefit plan as a condition of this Agreement. Client may choose its own benefit plans and/or broker. By executing this Agreement and agreeing to participate in a PEO Benefit Plan, Client hereby waives any and all rights to seek relief against PEO and Insurasource, or their respective shareholders, owners, directors, officers, and employees, relating to the payment of fees by Insurasource to PEO.

3.3. Employment Practices.

To the extent requested by Client, PEO will provide Human Resources consulting services to designated management employees of Client, including assisting in the preparation of an Employee Handbook and other personnel policies and procedures. Client expressly understands and agrees that in providing Human Resource Consulting services, PEO is not providing legal advice or otherwise acting as the common-law employer of Client’s Covered Employees. Client is responsible to consult with legal counsel as needed regarding Human Resource or employment-related issues.

3.4. Payroll Administration.

PEO will process payroll payments in accordance with the applicable laws and regulations conditioned upon Client timely and accurately supplying all payroll data and funds necessary for PEO to perform its payroll processing services. In the event Client fails to pay PEO for its services, Client authorizes PEO to elect to pay Covered Employees on behalf of Client using only the applicable minimum hourly wage and/or applicable minimum salary for exempt employees. Client acknowledges that by doing so: (i) PEO in no way waives any right to recover from Client; (ii) PEO in no way admits to any employer or joint employer obligation to pay wages following a failure by Client to pay PEO absent an express obligation arising from state PEO licensing and registration laws; and (iii) Client is not relieved of its obligation to pay any unpaid wages owed to Covered Employees.

3.5. Payroll Taxes.

PEO will withhold, report and remit Federal, State, and local payroll taxes, including, without limitation, unemployment insurance contributions, for Covered Employees. PEO shall prepare and submit tax reporting forms required by law or regulation with respect to such compensation and benefits, including but not limited to Forms W-2 (Wage and Tax Statement); W-4 (Covered Employee’s Withholding Allowable Certificate); and comparable and/or counterpart forms prescribed by any state or local government. PEO shall process and receive any tax credits that may be due to clients as a result of PEO’s efforts, including but not limited to any work opportunity tax credits (“WOTC”).

3.6. Unemployment Compensation.

PEO shall administer unemployment compensation filings and claims, including opposing unemployment claims when appropriate. In those states or other jurisdictions in which PEO may or must use Client’s employer account for purposes of reporting and remitting unemployment insurance contributions or any other payroll taxes, Client authorizes PEO to do so and agrees to cooperate with PEO in the use of Client’s account. Client shall provide all required and requested forms, signatures, powers of attorney, reports, documents, and current and historical data.

3.7. Workers’ Compensation.

PEO will provide workers’ compensation insurance coverage for the Covered Employees and administer claims under said coverage in accordance with the requirements of applicable law. Client acknowledges that PEO is not a workers’ compensation insurance provider, carrier, or broker, and that as such PEO may not be subject to certain laws and regulations governing same. Client’s Covered Employees who are not timely reported to PEO, pursuant to the terms of Section 5.10 and in compliance with PEO’s new-hire onboarding requirements, will not be covered by workers’ compensation insurance provided through PEO for any period during which they are not a Covered Employee.

3.8. EPLI and Cyber Liability Insurance.

PEO shall provide Employment Practices Liability Insurance (“EPLI”) and Cyber Liability Insurance (“CLI”). In the event that Client maintains its own EPLI or CLI, (separate from PEO) Client’s coverage shall be primary. In the event of a claim against Client and/or PEO covered by PEO’s EPLI or CLI, Client shall be responsible for payment of the deductible or self-insured retention (collectively “Deductible”) (including all legal fees and costs incurred within the Deductible). Client shall be responsible for any expenses, claims, settlements, damages, judgments and attorney fees associated with any claim brought by a Covered Employee against Client and/or PEO not covered by PEO’s EPLI or CLI as well as any settlement or claim costs that exceed the amount paid by the insurance carrier pursuant to the EPLI or CLI policies. PEO’s EPLI and CLI will only apply to claims made and submitted for coverage during the Term of the Agreement and arising from events occurring during the Term of the Agreement. In the event of a conflict between the terms of the EPLI or CLI policies and this Agreement, the policy terms will control. PEO makes no representations regarding the insurance carrier, insurance limits, deductible, or scope of coverage provided by PEO’s EPLI and CLI policies, and all such terms are subject to change without notice. Any coverage provided by EPLI or CLI is subject to the limits of liability, terms, conditions and exclusions of the PEO’s policies.

4. Client Responsibilities.

Client shall be responsible for the following obligations:

4.1. Work Site Safety.

Client is the sole Employer with respect to safety-related compliance, and Client agrees that Client and PEO are not joint employers or dual employers, as those terms are defined by any applicable state law and regulations or OSHA. Client retains exclusive control over the safety of the workplace(s) where Covered Employees work, and thus retains sole responsibility for compliance with applicable federal, state and local health and safety laws, regulations, ordinances, directives and rules relating to the workplace (“Workplace Safety Laws”). Client is solely responsible to identify and eliminate all known workplace threats to Covered Employees’ health or safety. Client acknowledges and agrees that Client has not retained PEO to manage or control Client’s business or operations, and PEO has no duty or authority to inspect, install, modify, repair, or maintain any equipment, tools, vehicles, or machinery that Covered Employees may use. However, PEO reserves the right to inspect Client’s workplace for the sole purpose of verifying compliance with the terms of the Agreement. Any inspections that PEO or its workers’ compensation insurance carrier may conduct are not for the purpose of identifying the unique threats to the health and safety of Covered Employees that may exist in Client’s workplace(s), thus such inspections would not fulfill a requirement for a full safety audit or inspection under applicable laws or regulations. Thus, Client will at its sole cost and expense take all necessary steps to comply with Workplace Safety Laws, including, without limitation, the following:

4.1.1. Client shall take reasonable steps to evaluate worksite conditions pertaining to the health and safety of Covered Employees, by doing periodic inspections;

4.1.2. Client shall identify all known hazards to Covered Employees’ health and safety, inform Covered Employees of such health and safety hazards, and take all reasonable measures to eliminate such health and safety hazards;

4.1.3. Client shall provide Covered Employees with appropriate and required PPE;

4.1.4. Client shall provide legally required training to Covered Employees regarding the safe performance of job duties, the proper use of PPE, and the maintenance of a safe work environment;

4.1.5. Client shall establish and maintain a written, effective Injury and Illness Prevention Program (“IIPP”) that protects Covered Employees, and Client shall fully implement Client’s IIPP;

4.1.6. Client shall implement specific safety programs as required by state mandated and OSHA requirements, depending on the work environment and the type of work being performed by Covered Employees;

4.1.7. Client shall ensure that each Covered Employee has, and is informed of, the following protections: (i) Covered Employees have the right to complain or report work conditions that the Covered Employee reasonably believes to be unsafe, unhealthful, or hazardous; (ii) Covered Employees have the right to refuse to work in conditions that the Covered Employee reasonably believes to be unsafe, unhealthful, or hazardous; and (iii) Covered Employees will not be subjected to any sort of retaliation or discrimination for reporting unsafe, unhealthful, or hazardous conditions or for refusing to work in unsafe, unhealthful, or hazardous conditions;

4.1.8. Client shall immediately report accidents or injuries and work-related illnesses involving Covered Employees (including “first- aid” events). Client shall deliver a complete written report of an accident or injury to PEO as soon as possible after the occurrence of such accident or injury. Client’s failure to timely report an accident or injury involving Covered Employees may result in one or more substantial fines, or other costs, pursuant to applicable law or to insurance company protocols and/or operating procedures. Any fines or any other costs incurred as a consequence of Client’s failure to comply with the provisions of this Section 5 shall be the sole responsibility of Client. Client agrees that if PEO receives a citation as a consequence of Client’s failure to comply with this Section 5, Client’s indemnification obligations, set forth in Section 8 shall apply;

4.1.9. Client will cooperate in accident/injury investigations by the applicable workers’ compensation carrier or its representative;

4.1.10. If modified or light duty is required for a Covered Employee by applicable law or requested by PEO or its workers’ compensation carrier for the purpose of reducing the costs of claims that may be incurred, PEO will assist Client in providing modified or light duty for the costs outlined in a signed separate addendum between the Parties;

4.1.11. In the event PEO safety consultants provide advice or information to Client regarding safety in the workplace, PEO does so as a consultant only and not as the employer in control of the workplace. Client at all times retains sole responsibility for providing appropriate training regarding job duties, workplace safety, and other related topics.

4.2. At-Will Employment.

PEO is not bound by any employment contract between Client and a Covered Employee, including without limitation a contract requiring cause for termination of employment. Upon termination of this Agreement for any reason, or upon Client’s failure either to provide payroll data as required herein or to timely pay as required herein, all Covered Employees shall no longer be Covered Employees serviced by PEO. Any and all services provided by PEO shall be retroactive to the last date of service for which PEO was fully paid by Client for PEO’s services.

4.3. Workers’ Compensation Classification Code Assignment and Changes in Job Status.

Client is solely responsible for the accuracy of the workers’ compensation classification code assignment. Client shall notify PEO immediately of any change that may affect the workers’ compensation status of any Covered Employee, including but not limited to any change in job duties or job locations. Any increase in charges or costs incurred as a consequence of Client’s failure to comply with the provisions of this Paragraph shall be the sole responsibility of Client.

4.4. Client Benefit Plans.

Client will not provide employee benefits to Covered Employees or their dependents in addition to or in lieu of the benefits available under the PEO Benefit Plans (“Client Plans”) without the express written consent of PEO. To the extent employee benefits are provided to Covered Employees or their dependents under a Client Plan and such Client Plan is not administered by PEO, Client will: (i) ensure that the Client Plan is administered in compliance with applicable law and the terms and provisions of the applicable plan documents; and (ii) retain sole responsibility and liability for the Client Plan. Client understands, acknowledges and agrees that: (a) PEO is not a plan sponsor, plan administrator or fiduciary with respect to any Client Plan; (b) PEO shall have no other role, responsibility or liability with respect to any Client Plan, including, without limitation, that of a third-party administrator; and (c) to the extent that PEO provides any administrative or other services with respect to a Client Plan, (1) all such services are taken on behalf of Client and at Client’s specific direction, (2) PEO shall have no discretion with respect to such services, (3) PEO shall not take on any fiduciary or other obligations as a result of such services under the Employee Retirement Income Security Act of 1974, as amended (ERISA), or any other law and (4) Client shall remain solely responsible and liable for such services and any underlying Client obligations.

4.5. Confidential Information.

Client retains sole responsibility for the maintenance and protection of Client’s confidential information, trade secrets, and proprietary information. Except to the extent required by law and/or to perform its duties under this Agreement, PEO will not disclose payroll- and/or health-related data and/or other confidential information it receives from Client.

4.6. Control of Client Business.

Client shall have exclusive responsibility for control of Client’s Business. For purposes of this Agreement, “Client’s Business” shall mean all aspects of Client’s business other than the services provided to Covered Employees by PEO during the term of the Agreement. Any action taken in connection with Client’s Business shall be deemed taken by or on behalf of the Client, and not by PEO. Neither this Agreement, nor the fact that one or more persons authorized to act on behalf of Client may be Covered Employees hereunder, shall be deemed to grant to PEO any right or authority, or place upon PEO any duty or responsibility, to make any decision regarding Client’s Business.

4.7. Cooperation with PEO.

Client shall respond in a timely and accurate fashion to requests from PEO for records and data necessary for PEO to perform its services. Upon receipt Client shall immediately send PEO copies of demands, notices, claims, summons and other legal papers related to the Covered Employees. Client shall cooperate with PEO in the investigation, remediation, settlement, and defense of legal claims related to the Covered Employees.

4.8. Employee Supervision.

Client shall be responsible for sufficiently supervising, directing, and controlling the Covered Employees in order for Client to safely and lawfully conduct its business.

4.9. Downsizing Notices.

Client shall provide all notices required by the Worker Adjustment and Retraining Notification Act (“WARN”), and similar state and local laws. Client will also provide PEO with no less than sixty-two (62) days’ notice of any layoff or plant closing that may immediately or in the future require the provision of notice under such laws.

4.10. Employee Documentation and Communication.

Client will comply with PEO ’s directives regarding the requirements to onboard Covered Employees. Client shall cooperate with PEO to assure receipt by PEO of all properly completed new-hire onboarding documentation, including, but not limited to form W-4, form I-9, and such additional documentation as PEO may require, and Client shall not permit a newly-hired Covered Employee to commence work until PEO has approved the new hire onboarding paperwork and accepted such worker as a Covered Employee. Once accepted as a Covered Employee, PEO may freely communicate with the Covered Employee through text message or other mediums of communication in an effort to provide the Covered Employees with ancillary services unless such Covered Employee chooses to opt-out of receiving the communications.

4.11. Fiduciary Liability.

PEO does not provide Client with insurance for fiduciary liability covering loss that might result from a loss of Covered Employee funds held by PEO in a fiduciary capacity.

4.12. Employment Legal Compliance.

Client shall comply with Federal, State and local laws governing labor and employment, including but not limited to the Civil Rights Acts of 1866, 1964 (including Title VII), and 1991, the Age Discrimination in Employment Act (“ADEA”), the Americans with Disabilities Act (“ADA”), the Family and Medical Leave Act (“FMLA”), the Fair Labor Standards Act (“FLSA”), the Worker Adjustment and Retraining Notification Act (“WARN”), the National Labor Relations Act (“NLRA”), the Equal Pay Act (“EPA”), the Vietnam Era Veteran’s Readjustment Assistance Act (“VEVRAA”), the Fair Credit Reporting Act (“FCRA”), the Employee Polygraph Protection Act (“EPPA”), the Immigration Reform and Control Act (“IRCA”), the Older Workers Benefits Protection Act (“OWBPA”), the Occupational Health and Safety Act (“OSHA”), the Uniformed Services Employment and Reemployment Rights Act (“USERRA”), the Genetic Information Non- Discrimination Act (“GINA”), and all other local, state (including any and all states within the United States), and federal laws governing the employment relationship, including but not limited to, such laws governing discrimination and harassment in the workplace and the regulation of wages and hours in the workplace (collectively, the “State and Federal Employment Laws”).

4.13. Exclusive Relationship.

Without the written consent of PEO, neither Client nor any affiliate of Client shall pay wages or other taxable compensation directly to any Covered Employee or directly employ and compensate any Covered Employee. In the event of a breach of the prohibitions contained in this Paragraph 5.13, then, beginning on the first day of the first applicable pay period (“Pay Period”) in which there was a breach, Client shall (i) be solely responsible to perform all employer obligations, including without limitation provision of workers’ compensation insurance coverage, paying all earned wages, withholding, payment of employment taxes, and compliance with all laws and regulations governing the employment relationship, (ii) bear all risk resulting from any failure to perform any such obligations, and (iii) indemnify PEO against any loss, cost, claims or expense arising as a result of such employment or by operation of law as a result of failure of Client to perform any obligation. Client remains solely responsible for payment of reimbursable business expenses owed to Covered Employees.

4.14. Leave Laws and Compliance.

Client is solely responsible for obligations and costs associated with compliance with the federal Family and Medical Leave Act (“FMLA”) and similar state and local laws (“Leave Laws”), including but not limited to the cost of reinstating or finding replacement employment and the cost of continuing benefits during FMLA or other similar leave. Client acknowledges that PEO is not a joint employer for purposes of Leave Laws. However, in the event a court or administrative agency determines PEO to be a joint employer for purposes of Leave Laws, Client agrees that it is the primary employer and that it will be the successor employer upon termination of this Agreement for purposes of Leave Laws compliance.

4.15. Government Contracts.

Client is solely responsible for complying with requirements pertaining to government contracts pursuant to federal, state, county or local laws, regulations, and ordinances, including but not limited to compliance with Executive Order 11246, the Walsh-Healey Public Contracts Act, the Davis Bacon Act, and the Service Contract Act of 1965.

4.16. Employee Selection.

Client shall have sole responsibility for the pre-hiring evaluation of Covered Employees. No person shall be deemed a Covered Employee until accepted by PEO as a Covered Employee. Client may conduct such testing, interviews, and background investigation and other review of the suitability of any Covered Employee as it may deem appropriate, with or without the assistance of PEO, prior to employment; provided, that any such testing, interviews, and investigations shall be conducted in compliance with all applicable laws, rules, and regulations. PEO shall have no obligation or liability to Client with respect to the suitability of any Covered Employee for his or her job responsibilities. Client expressly understands and agrees that in providing any consulting services or assistance to Client, PEO is not providing legal advice. Client is responsible to consult with outside legal counsel as needed regarding its recruiting and hiring practices.

4.17. Legal Compliance.

Client shall have responsibility for complying with all laws governing the Client’s business, including but not limited to required filings, licensing, taxes, fidelity bonding, insurance, facilities/building codes and regulations, and environmental compliance. If any Covered Employee is required to be licensed, registered or certified under any federal, state, or municipal law or regulation, or to act under the supervision of such a licensed, registered or certified person or entity in performing the employee’s services, then any such person shall be deemed to be an employee of Client for such licensure purposes. Client shall be solely responsible for verifying such licensure and/or providing the required supervision.

4.18. Notice of Claims.

Client shall promptly advise PEO of all Covered Employee complaints, claims, filings and requests related to the employment of Covered Employees and shall promptly provide to PEO complete and accurate information regarding such matters. Client shall promptly advise PEO of any claims of discrimination, sexual harassment, or other improper conduct of a Covered Employee or if a Covered Employee is alleged to be a victim of discrimination, sexual harassment, or other improper conduct no later than five (5) business days after Client learns of the claim or allegation.

4.19. Other Taxes and Fees.

Other than payroll-related withholding and taxes covered by this Agreement, Client shall have sole responsibility for paying and reporting all taxes and governmental fees (including environmental fees required by any applicable state’s Health and Safety Codes).

4.20. Paid Perquisites.

Client is solely responsible for administering, funding, and accurately determining eligibility for paid perquisites, including but not limited to vacation, sick leave (including legally-mandated paid sick leave), other paid time off, profit sharing, deferred compensation, bonuses, severance payments, stock options/grants/warrants, commissions or other equity-based compensation, and other incentive compensation payments. All payments should be made through PEO’s payroll in order to ensure proper reporting and remittance of taxes, PEO takes no responsibility for the administration or funding of said paid perquisites payments.

4.21. Payroll Data.

Client will timely and accurately provide all data necessary for PEO to process payroll for the Covered Employees, including but not limited to hours worked, rates of pay, payments owed, and exempt/non-exempt status for every payroll period in accordance with the requirements of the Fair Labor Standards Act (“FLSA”), any applicable state or local law and any agreement between Client and the Covered Employee. Client assumes full responsibility for the accuracy of such reports and the amount of remuneration due each employee. Although upon Client’s request PEO may provide Client with information regarding the principles concerning exempt and non- exempt status classifications, Client is solely responsible for determining the exempt status of Covered Employees, and Client agrees that Client alone possesses sufficient information to make such determinations. Client shall maintain accurate records of hours worked to the extent required by law and will make such records available to PEO upon request. Client is solely responsible for creating and maintaining records of hours worked and attendance, regardless of whether Client utilizes time and attendance tracking systems provided by PEO (if any). Client shall maintain other records as directed by PEO and in compliance with PEO ’s policies and procedures. Client shall not withhold or authorize the withholding of a payment of wages absent express written permission from a Covered Employee and will not violate any applicable law pertaining to the payment of wages. Client will not violate any applicable law pertaining to deductions from wages when instructing PEO to make deductions. Client shall not make any taxable payment of any kind, except profit sharing or pension plan distributions pursuant to the terms of a qualified plan, directly to any Covered Employee. Client agrees to immediately forward to PEO any order or notice of garnishment, involuntary deduction, IRS lien or other legal process received by Client affecting wages paid to Covered Employees and, if requested by PEO, to sign such documents as are necessary to authorize PEO to act on Client’s behalf in responding to such legal process. Client shall be solely responsible for all non-compliance penalties and liabilities resulting from Client’s failure to timely forward such legal process to PEO or to sign required authorization documents.

4.22. Prompt Payment.

Client shall make timely payments due to PEO under this Agreement to assure timely payment of payroll.

4.23. Protection of Covered Employee Rights.

Client shall notify PEO immediately of any action, event or circumstance which has resulted in or may result in a claim of employment discrimination or sexual harassment, improper denial of workers’ compensation or employee benefits, or other alleged violation of the rights of any Covered Employee under any law or regulation governing the relationship of employers and employees.

4.24. Reasonable Accommodations.

To the extent applicable to Client and to the extent required by applicable law, Client shall at its sole expense accept obligations and costs associated with compliance with the ADA and similar state and local laws including but not limited to the cost of providing reasonable accommodation of disabilities and religious practices, reinstating employees returning from leave or finding replacement employment for them if required by law, and the cost of continuing benefits during leave if required by law.

4.25. State Specific Addenda.

This Agreement may reserve certain rights to PEO for the purpose of PEO delivering PEO services in compliance with applicable PEO licensing, registration, certification and other laws authorizing the delivery of PEO services. Any State Specific Addenda executed by Client are incorporated by reference as if set forth fully herein. Any additional duties and obligations of PEO described in the State Specific Addenda are applicable only to the extent required by law, and the reservation of PEO ’s right to perform any such duties or obligations is not an admission that such duties and obligations will or have been performed.

4.26. ACA Compliance.

Client understands, acknowledges and agrees that Client is solely responsible and liable for all obligations with respect to Healthcare Reform’s Employer “Play or Pay” Mandate under Section 4980H of the Internal Revenue Code of 1986, as amended (IRC), and other applicable laws, including, without limitation, any tax reporting obligations under IRC Sections 6055 and 6056. To the extent that PEO agrees to assist Client with satisfying these obligations, Client understands, acknowledges and agrees that: (i) PEO is not providing legal or tax advice to Client and Client will seek appropriate legal and tax advice from its own legal and tax advisors; (ii) PEO will rely on the accuracy of all information and documents provided by Client with respect to such assistance; and (iii) Client will remain solely responsible and liable for such obligations.

4.27. Immigration.

Client is solely responsible for all I-9 processes and procedures. Client will ensure that the I-9 is timely and properly completed for all newly hired Covered Employees; retain I-9 documents for the period required by law; and update I-9’s when required by law. To the extent requested by Client, PEO may provide information or assistance to Client regarding the proper procedures for completion of the I-9; however, Client retains sole responsibility for complying with all Form I-9 legal requirements. Any fines or other penalties resulting from Client failing to follow proper I-9 procedures and processes will be solely Client’s responsibility. Client shall not engage in any discriminatory or other unlawful acts with respect to the I-9 process.

5. Fees.

5.1. Rates.

Client shall pay PEO fees according to the rates set forth in the Fee Schedule, attached hereto as Schedule A and such fees and other amounts accruing and due from Client to PEO shall be personally guaranteed through the execution of Schedule B. Should Client require additional services not included in this Agreement, the fee for any such additional services shall be negotiated and paid separately.

5.2. Fee Adjustment.

The administrative fee reflected on Schedule A is based on conditions as of the Effective Date. The necessity of a revised administrative fee shall be determined from time to time as necessary to accommodate changes in job classifications of Covered Employees. In the event of a change in Client’s business, or in current taxes, laws or relationships related to the employer/Covered Employee relationship which affect PEO ’s costs, the administrative fee shall be adjusted for any increase in such costs. In the event any such changes are not reported to PEO, prior to calculation of the administrative fee for any Pay Period, the administrative fee for such Pay Period shall be subject to retroactive adjustment and PEO shall be entitled to payment of any such adjusted administrative fee. Annually on Agreement Effective Date, PEO ’s administrative fee is subject to an automatic minimum adjustment as necessary to accommodate changes in the market.

5.3. Retroactive Fees or Charges.

To the extent that any tax, premium or other cost of PEO is unilaterally increased by a governmental body or other third party beyond the control of PEO, whether prospectively or retroactively, Client understands, acknowledges and agrees that PEO will invoice Client for such increases and that any fees or charges associated with such increases will be due and payable in the same manner as any other fees or charges invoiced pursuant to this Agreement, even if such fees or charges are invoiced after the termination of this Agreement.

5.4. Optimal Benefits Payments.

For each Pay Period, Client shall also pay to PEO an amount equal to PEO ’s costs and charges during such Pay Period related to optional benefits selected by Client and provided with respect to each Covered Employee, such as health insurance, dental insurance, life insurance, disability insurance, matching 401(k) contributions, or other benefits. (“Benefits Payment”).

5.5. Interest on Late Payments.

If Client fails to pay the fees required by Schedule A for any Pay Period, or any other amount payable by Client to PEO under this Agreement, on or before fifteen (15) days following the applicable due date, PEO may, at its option, terminate this Agreement without notice, pursuant to Paragraph 18.2. Additionally, PEO may, at its option, charge and collect interest on any such past due amounts. The rate of interest on the total amount that is past due shall be a rate equal to the greater of the maximum amount allowed by law, eighteen percent (18%) per annum, or five percent (5%) in excess of the prime rate of interest, as published by the Wall Street Journal, in effect from time to time during the period in which such amount remains due and unpaid. Client shall pay any accrued interest within ten (10) days following demand for payment. The imposition of interest on late payments shall not extend the due date of any such payment. The Late Payment Fee is calculated as three percent (3%) of the total amount invoiced, and becomes due upon any failed transfer of funds, regardless of payment method, so long as the failure is not a direct result of a PEO ’s error or omission.

5.6. Bankruptcy.

Client will immediately notify PEO of the initiation of any bankruptcy or receivership or insolvency proceedings of whatever form (whether voluntary or involuntary). Client agrees that any wages or taxes or contributions paid or advanced by PEO prior to such bankruptcy that remain unpaid by Client shall be treated as outstanding wage obligations for the purposes of determining priority in the associated legal proceedings with the intended effect that PEO shall have the same rights as Covered Employees with respect to such wages and associated taxes and shall be entitled to relief as necessary to apply such status.

5.7. Ancillary Fees.

Client agrees that the fees outlined on Schedule A are not inclusive of other fees that may be assessed by PEO for failure to comply with the terms of this Agreement, including but not limited to the ancillary fees located on Schedule C.

5.8. Rates.

Client agrees to remit to PEO the Occurrence Fee Deposit (“OFD”) reflected on Schedule A for the purpose of guaranteeing Client’s obligation to reimburse PEO up to the Occurrence Fee listed on the Schedule A for each and every workers’ compensation claim incurred by any covered individual under the workers’ compensation insurance administered by PEO pursuant to this CSA. This security deposit shall be paid to PEO by Client on or before the first payroll processed by PEO under the CSA. The Occurrence Fee obligation of Client is the amount equal to the total incurred amounts, up to the Occurrence Fee amount of each and every claim as described above, and as further identified in Schedule A of the CSA, less amounts previously paid by Client. PEO shall produce a monthly Occurrence Fee Statement (“OFS”) identifying the employee, date of injury, total incurred amount, and the amount previously invoiced, as well as the balance due from Client. The balance due shall be the combined total of the total incurred amount of each claim, up to the Occurrence Fee, less any amounts previously paid to PEO by Client relating to the Occurrence Fee. An OFS will be emailed to Client no later than the 10th day of each month and PEO shall invoice Client for the OFS amount each month and shall e-mail the invoice to Client by the 15th day of the same month, and such invoice shall be due on or before the 25th day of the month. Client agrees that at PEO’s sole discretion, the OFD may be used to pay any financial obligation owed by the client under the terms of this CSA. Client’s obligation to pay the Occurrence Fee shall continue post termination of the CSA until such time as the occurrence fee liability limit is reached or the claim is closed. Upon termination of the CSA by either party, PEO shall, within five (5) business days of notice of termination, calculate the Client’s Estimated Total Incurred Liability (“ETIL”) by using actuarially sound methods and factors which are customarily utilized by workers’ compensation insurance companies for developing incurred losses to their ultimate liability. PEO shall provide CLIENT with a copy of the ETIL calculation and all data used by PEO to calculate same,including an invoice for the balance of the Occurrence Fee, less the OFD, and Client agrees to pay PEO the invoice amount within fifteen (15) days of receipt of the invoice. If the invoice amount results in a credit, PEO shall remit to Client the credit balance within fifteen (15) days of the calculation date. Post-termination, PEO shall continue providing Client with a monthly Occurrence Fee statement until all claims are closed and the Occurrence Fee obligation is paid in full. The OFD shall be held a minimum of ninety (90) days following the termination of this CSA to account for potential of incurred but not reported (“IBNR”) claims or the reopening of claims. PEO shall return any unused OFD amount to the client within forty-five (45) days from the date upon which all of the client’s obligations under the CSA have been fulfilled. If the Occurrence Fee amount is changed subsequent to this agreement, the OFD shall be retained to cover the obligations of this agreement and used or returned as outlined herein. In exchange for the Occurrence Fee, PEO shall provide Client with comprehensive loss control services designed to reduce the frequency and severity of occupational injuries and increase regulatory compliance, PEO’s services include but are not limited to worksite safety inspections, IILP development and implementation, employee training, education support, claim intake and reporting, claim investigations, claim following and shadow adjusting, loss history evaluation and other general loss control program management.

6. Payment Procedures.

No later than 10 a.m. three (3) business days before the applicable payroll issuance date (“Payday”), Client will provide PEO, in the method authorized by PEO, with the payroll data upon which each Covered Employee’s compensation is calculated, in the format proscribed by PEO. As soon as practicable following receipt of the payroll data, PEO will send to Client an invoice for payment. Upon receipt of the invoice, Client will notify PEO of any errors or modifications proposed by Client and thereafter waives any right to dispute the content of the invoice. Client shall make payment no later than one (1) business day prior to each Payday. PEO requires the Fee to be paid one (1) business day before delivery of payroll. PEO furthermore requires all funds to be either (1) ACH deposited (PEO-initiated); (2) deposited via reverse wire transfer (PEO-initiated); or (3) deposited via wire transfer (Client-initiated) directly into PEO ’s payroll account being administered by its designated bank. The method of payment will be determined by PEO in its sole discretion and Client will provide all necessary bank account information during the client intake process, prior to the processing of Client’s first payroll under this Agreement. PEO does not accept checks as payment for services of any kind. The Payday shall be the same day of each Pay Cycle as the First Payday. Any change in the Payday shall require PEO ’s prior consent at least thirty (30) days prior to such change. PEO may, if PEO determines in its sole discretion that Client is a credit risk, require Client to tender payment for the charges set forth in Schedule A for each Covered Employee, on the first business day prior to each payroll period in an amount equal to the estimated amount for the current payroll period. The estimated amount for the current payroll period will be the amount equal to the amount invoiced to and paid by the Client for the immediately preceding payroll unless PEO, in its sole discretion, contacts the Client with a different amount. PEO shall earn the amount concurrently with the accrual of the services PEO provides to Client. Upon receiving an invoice from PEO, Client shall immediately pay for any additional amount for that payroll period. Client understands and agrees that any overpayment can be used by PEO to offset the estimated amount due on the subsequent payroll period. If the Client does not make the payment on the first business day prior to each payroll period as required by this paragraph, PEO may, at its option, declare the Client to be in default and immediately terminate this Agreement.

7. Indemnity.

7.1. Client hereby agrees to indemnify, defend, and hold PEO harmless from and against any and all claims, demands, damages (including liquidated, punitive and compensatory), injuries, deaths, actions and causes of actions, costs and expenses (including attorney’s fees and expenses at all levels of proceedings), losses and liabilities of whatever nature (including liability to third parties), and all other consequences of any sort, whether known or unknown, without limit and without regard to the cause or causes thereof or the negligence of PEO, arising from: (1) Client’s material breach of the Agreement or violation of any representation or warranty associated with the Agreement; (2) the products or services provided by Client; (3) the actions or inactions of any Covered Employee; (4) the supervision and employment of Covered Employees and termination thereof; (5) Client’s failure to comply with wage and hour laws, regulations, or rules in the workplace (including meal and rest breaks, minimum wage, and overtime); (6) the actions or inactions of any agent or Covered Employee employed by Client, or of any other individual, including without limitation, any violation of any local, state and/or federal law, regulation, ordinance, directive or rule whatsoever, and the State and Federal Employment Laws.

7.2. PEO, except to the extent Client assumes liability under the Agreement, hereby agrees to indemnify and hold Client harmless from and against any and all claims, demands, damages (including liquidated, punitive and compensatory), injuries, deaths, actions and causes of actions, costs and expenses (including attorney’s fees and expenses at all levels of proceedings), losses and liabilities arising from PEO ’s gross negligence in the performance of duties expressly required by the terms of this Agreement. PEO ’s indemnification obligation includes the obligation to indemnify Client in the event payroll taxes, workers’ compensation premiums or state unemployment payments are not paid timely and accurately. Such obligation is contingent upon Client providing PEO with timely and accurate information, as well as payment by Client to PEO of the required fees under this Agreement.

7.3. Client and PEO expressly agree that the indemnification provisions of the Agreement shall not be limited to claims, expenses or liabilities for which one of them is solely liable, but shall also apply to claims, expenses and liabilities for which Client and PEO are jointly or concurrently liable. In such event, if either of them advances funds in connection with a claim, expense or liability in excess of its pro rata share, such party shall be entitled to recover from the other party the difference between such party’s share and the actual amount paid. The indemnification provisions of the Agreement shall survive termination of the Agreement.

8. Representations and Warranties.

Client represents and warrants as follows:

8.1. Client’s Obligations to Covered Employees.

(i) All compensation of the Covered Employees accrued prior to the Effective Date and for which Client or any third party is responsible and obligated has been paid in full; (ii) neither Client, nor to the knowledge of Client, any third party who provides or has provided PEO services or personnel staffing services to Client, has any employment contract, written or verbal, with any Covered Employee; (iii) there are no separate contracts, agreements or other arrangements existing with respect to the Covered Employees as a group or any of them which would bind or obligate PEO, except as expressly set forth herein; (iv) Client shall notify PEO of the principal location of the workplace of each Covered Employee and each location where such Covered Employee performs services for Client, and of any changes in such locations; and (v) all pension, profit-sharing, or other employee benefit plans existing at the Effective Date are current and in compliance with applicable law, and execution of this Agreement shall not be deemed a breach under the terms of those plans.

8.2. Information.

As of the Effective Date, and throughout the term of this Agreement, all information provided by the Client in contemplation of this Agreement or pursuant hereto, including but not limited to financial statements, employee lists, job descriptions and classifications, compensation, benefits, historical and pending legal claims, and time reports is and shall be true and correct. No material adverse change has occurred in the financial condition of the Client or any guarantor of Client’s obligations under this Agreement since the date upon which any financial statements of Client or such guarantor were provided to PEO.

8.3. Work Site Safety.

Client is in compliance with all applicable Workplace Safety Laws, and Client has maintained, and will continue to maintain throughout the term of this Agreement, Client’s workplace(s), machinery, equipment, and environmental factors in compliance with applicable Workplace Safety Laws.

8.4. No Litigation.

Except as previously disclosed to PEO in writing, there is no action, suit, proceeding or investigation pending, or, to the knowledge of Client, threatened against Client, related to the Covered Employees or the Client’s employer/employee relationship with the Covered Employees or which may result in a material adverse change in the financial condition of Client or of any guarantor of Client’s obligations under this Agreement. Client will advise PEO promptly upon the inception of any such action, suit, proceeding, investigation or threat thereof.

8.5. Compliance with Applicable Law.

Compliance with Applicable Law. Client has not violated any applicable statute or regulation in any respect, which would adversely affect the Covered Employees or Client’s employment relationship with the Covered Employees. Client is and shall remain in compliance with all statutes, regulations, and executive orders with respect to Covered Employees and employment practices. Client acknowledges that certain requirements applicable to employers under various federal and state statutes, rules, and regulations, including but not limited to the Family Medical Leave Act, Americans with Disabilities Act, Worker Adjustment and Retraining Notification Act, Title VII of the Civil Rights Act of 1964, and Age Discrimination Employment Act, are based on the size and identity of the employer, and that Client’s status under one or more of such statutes, rules, and regulations may change as a result of entering into this Agreement.

9. Access to Workplace and Business Records.

PEO shall be entitled to review all business operations of Client and to audit all books and records of Client to the extent necessary to assure compliance by Client with its obligations under this Agreement. Client shall provide PEO or its designee’s access, at any reasonable time during customary business hours, to the business premises, books, and records of Client to the extent necessary to assure such compliance.

10. Insurance.

Client shall maintain, at all times, the following insurance coverages with an A.M. Best “A” rated or better carrier:

(i) comprehensive general liability (including, but not limited to bodily injury, premises, operations, contractual liability, productand completed operation liability, with broad form endorsements, personal injury and advertising liability); (ii) automobile liability, including non-owned and hired autos (to the extent any Covered Employees will be assigned to positions requiring them to drive for Client); and (iii) professional liability insurance, if appropriate, including but not limited to malpractice or errors and omissions coverage and in compliance with any regulation mandating such coverage.

Each of such policies shall have as a minimum a limit of liability not less than one million dollars ($1,000,000). Client shall have PEO listed as an additional insured on all such policies. By the Effective Date of this Agreement, Client shall furnish PEO with Certificates of Insurance as evidence of coverage. Each of such policies shall be on an “occurrence” basis. However, in the event that an “occurrence” policy is not available, Client shall maintain an equivalent “claims made” policy until the expiration of all statutes of limitation applicable to any claim which could arise under this Agreement or by virtue of the services provided by the Covered Employees.

11. Existing Insurance.

Unless otherwise specifically agreed in writing by PEO, Client shall maintain in full force and effect at all times during the term of this Agreement, all insurance required under this Agreement and all property, fire and liability insurance (other than workers’ compensation insurance applicable to Covered Employees) existing as of the Effective Date. Client further agrees to cause PEO to be named as an additional insured with respect to each such policy of insurance.

12. Fidelity Bonds.

Client shall advise PEO of any Covered Employee with access to cash or Fidelity Bonds, or other property of Client or of any third-party property within the control of Client. PEO may, at its option, require Client to obtain a fidelity bond naming Client and PEO as insured(s) with respect to each such Covered Employee. PEO shall have no obligation with respect to or liability as a result of embezzlement, fraud, defalcation or misappropriation of any of such property by any Covered Employee, and Client indemnifies PEO against loss, cost, claim, or expense arising from any such action

13. Contractors.

PEO shall have no obligation to provide workers’ compensation insurance for Client’s contractors or employees of contractors engaged by Client. Client shall not, directly or indirectly, engage or hire any contractor that does not have workers’ compensation insurance coverage with respect to its employees. Client shall obtain a certificate evidencing workers’ compensation insurance coverage with respect to the employees of any contractor engaged by Client or shall provide workers’ compensation insurance coverage with respect to the employees of any such contractor.

14. Default.

In the event of default by Client in performance of any obligation under this Agreement, PEO may, at its option and at Client’s expense, (i) take such action as may be necessary to cure any such default, (ii) impose an additional charge or fee to compensate PEO for any costs, expense, or inconvenience resulting from such default, (iii) offset against any security deposit held by PEO any amount due PEO hereunder, terminate this Agreement as provided in section 16, and (v) exercise any other remedy available by law, including but not limited to enforcement of any obligation of Client to indemnify PEO under this Agreement. Client acknowledges that the exclusive PEO relationship described in Section 5.13 and Client’s obligations to perform its obligations thereunder are fundamental to PEO ’s expectations under this Agreement. If this Agreement is terminated by PEO as the result of a breach by Client of such obligations, in addition to all amounts invoiced and owed for services provided to Client, PEO shall be entitled to recover as liquidated damages an early termination fee of $500.00 per Covered Employee that is active in PEO’s system at the time of termination by PEO for the breach by Client, in addition to other remedies available to it under this Agreement.

15. Termination.

15.1. Notice.

PEO may terminate this Agreement for any reason by providing Client written notice of such termination no less than thirty (30) days prior to the effective date of the termination. After the initial first year term of this Agreement, Client may terminate this Agreement for any reason by providing PEO notice of such termination no less than thirty (30) days prior to the effective date of the termination. Client may also terminate this Agreement in the event of a material breach by PEO following (1) a written notice of breach; and (2) a period of no less than thirty (30) days to cure the breach set forth in said notice.

15.2. Immediate Termination.

PEO may, in its discretion, terminate this Agreement immediately without prior written notice for any of the following reasons:

(i) failure to pay any invoice and/or amounts owed when due. In the event that Client is in default of this Agreement due to its failure to pay any invoice and/or all amounts due PEO, PEO, reserves the right at its election to terminate this Agreement retroactive to the beginning of Client’s pay cycle for which Client is in default. Termination of the Agreement shall not relieve Client of any and all obligations set forth in this Agreement. PEO will no longer have any additional obligations under this Agreement with respect to Client and Client’s Covered Employees;

(ii) failure to comply with any directive of PEO, when such directive is made to comply with (a) a federal, state or local governmental body, department or agency, or (b) a directive by an insurance carrier providing coverage to PEO and/or its employees;

(iii) making a direct payment of taxable wages by Client to any Covered Employee under this Agreement for services contemplated by this Agreement; (iv) performing any act that usurps any legal or contractual right or obligation of PEO to the Covered Employees;

(v) the threat of, or actual, filing by or against Client for bankruptcy, reorganization or appointment of a receiver, supervisor, assignee, or liquidator over its assets or property;

(vi) a material breach of this Agreement;

(vii) a money judgment against Client which remains unsatisfied for more than thirty (30) days and has not been appealed; and/or

(viii) PEO determines, in its sole discretion, which Client is a credit risk.

15.3. Replacement Coverage.

In the event that this Agreement is terminated, regardless of the reason for the termination, Client shall immediately secure (i) replacement workers’ compensation insurance for the benefit of the Covered Employees who continue their employment with Client; and (ii) replacement group health insurance for the benefit of both the Covered Employees who continue their employment with Client and any former Covered Employees of Client who are maintaining COBRA continuation coverage under a PEO Benefit Plan or who are otherwise entitled to COBRA continuation coverage. If Client does not secure replacement health insurance coverage in accordance with clause (ii) of the previous sentence, or should there be any delay in securing such coverage, Client shall pay PEO an administrative service fee of $500 per Covered Employee for each month the Covered Employee is insured by PEO ’s continuing coverage under COBRA.

15.4. Effective Date of Termination.

To the extent permitted by law, in the circumstance of termination by PEO due to Client’s failure to pay one or more invoices when they are due, PEO reserves the right to make the termination of the Agreement effective on the last day of the payroll period for which PEO received full payment by Client.

15.5. Obligations of the Parties.

Upon termination of this Agreement, regardless of how occurring, (i) Client shall pay to PEO the fees reflected on Schedule A with respect to service by Covered Employees during the term of this Agreement, (ii) PEO shall pay Covered Employees, make payments to third parties with respect to Covered Employees, and complete its accounting and reporting duties with respect to Covered Employees’ service during the term of this Agreement, (iii) Client shall indemnify and hold PEO harmless from any loss, cost, claim, or expense, resulting from termination of PEO ’s relationship with Covered Employees as a result of the termination by Client of this Agreement (except to the extent any such claim, cost, expense, or other loss is the result of action by PEO which is contrary to the provisions of this Agreement or applicable law or regulations), including, but not limited to any such loss, cost, claim, or expense resulting from the occurrence of a qualifying event under I.R.C. § 4980B with respect to any Covered Employee and any obligation to compensate any Covered Employee with respect to any period prior to or during which this Agreement was in force for unpaid vacation and sick leave, and (iv) each of the parties shall do all things necessary or requisite to conclude the business relationship and comply with Covered Employee and employer payment and reporting obligations. Following termination of this Agreement, PEO shall have no further obligations hereunder except as specifically described in this Agreement.

15.6. Early Termination Fee.

In the event Client terminates this Agreement in a manner that contravenes Section 16.1, Client shall pay PEO an early termination fee equal to $75.00 multiplied by the average number of Covered Employees in the three (3) month period preceding the early termination. This early termination fee is due to the costs and administrative burdens placed on PEO when a client terminates without sufficient notice or otherwise not in accordance with the terms of this Agreement.

16. Dispute Resolution.

16.1. ARBITRATION.

Except for claims for non-payment of fees under this Agreement and claims for injunctive relief, in the event of any claim, dispute or controversy arising out of or relating to the interpretation, performance and/or breach of this Agreement, the parties agree that any claim, dispute and/or controversy which would otherwise require or allow resort to any court or other governmental dispute resolution forum between Client and PEO, whether based on tort, contract, statutory or equitable law, or otherwise, shall be submitted to and determined exclusively by binding arbitration. The arbitration proceedings shall occur in Maricopa County, Arizona. The Arizona Code of Civil Procedure and Evidence shall apply to any such proceeding, and the arbitrator shall be a retired Federal or Arizona Superior Court Judge. To the extent applicable in Arizona civil actions, the following shall apply and be observed: all rules of pleading (including the right to file a demurrer and motion to strike), all rules of evidence, all rights to resolution of the dispute by means of motions for summary judgment, summary adjudication, and judgment on the pleadings. Resolution of the dispute shall be based solely upon the law governing the claims and defenses pled, and the arbitrator may not invoke any basis other than such controlling law. Awards exceeding Fifty Thousand Dollars ($50,000.00) shall include the arbitrator’s written opinion providing reasoned explanations for the decision, and at either party’s written request within ten (10) days after issuance of the award, shall be subject to reversal and remand, modification, or reduction following review of the record and arguments of the parties by a second arbitrator who shall, as far as practicable, proceed according to the law and procedures applicable to appellate review by the Arizona courts of appeal regarding a civil judgment following court trial.

16.2. Small Claims.

Any claim, controversy, or dispute arising out of or related to this Agreement in an amount equal to or less than the jurisdictional limits applicable under the Small Claims Division of Justice Courts (A.R.S. § 22-501 et seq.) of the State of Arizona (the “Small Claims Division”) shall be brought in Maricopa County, Arizona and shall be subject to, for purposes of this provision, the Small Claims Division. Client waives any objection to jurisdiction of the courts of the State of Arizona and venue in Maricopa County, Arizona.

17. General.

17.1. Waiver of Covenant, Condition or Remedy.

The failure to require performance of any covenant, condition or promise shall not invalidate this Agreement, nor shall it be considered a waiver of any other covenant, condition or promise, nor shall it excuse future performance in strict accordance with the provisions of this Agreement. The exercise of any remedy provided in this Agreement shall not be a waiver of any consistent remedy provided by law, and the provisions in this Agreement for any remedy shall not exclude other consistent remedies unless they are expressly excluded.

17.2. Applicable Law.

This Agreement will be determined to be a contract made within the State of Arizona and for all purposes will be governed and construed under and in accordance with the laws of the State of Arizona, notwithstanding choice of law principles, except that the PEO licensing laws of the state where the Covered Employee(s) work or worked shall apply, where applicable.

17.3. Headings.

Captions and organization are for convenience and shall not be used in construing meaning.

17.4. Time is of Essence.

Time is of the essence in this Agreement.

17.5. Severability.

Should any term, warranty, covenant, condition or provision of this Agreement be held to be invalid or unenforceable by a court or other body of competent jurisdiction or pursuant to arbitration, the balance of this Agreement shall remain in force and shall stand as if the unenforceable part did not exist. The invalid or unenforceable provision shall be replaced by a provision as similar as possible and which is valid and enforceable.

17.6. Entire Agreement.

Any proposal, bid, offer, or other prior discussion or communication regarding the subject matter of this Agreement is preliminary in nature, is superseded by this Agreement, and is intended solely for the purpose of discussion and evaluation. This Agreement constitutes the entire agreement between the parties. Client acknowledges that it has not been induced to enter into this Agreement by any representation or warranty not set forth in this Agreement, including but not limited to any statement made by any marketing agent of PEO. Client acknowledges that PEO has made no representation concerning whether PEO ‘s services will improve the performance of Client’s business.

17.7. Enforcement Costs.

In any action or proceeding to enforce any of the provisions of this Agreement, the prevailing party shall, in addition to all of the rights and remedies of the law, be entitled to recover the costs and expenses of any such litigation, including reasonable attorney’s fees and costs.

17.8. Successors and Assigns.

In any action or proceeding to enforce any of the provisions of this Agreement, the prevailing party shall, in addition to all of the rights and remedies of the law, be entitled to recover the costs and expenses of any such litigation, including reasonable attorney’s fees and costs.

17.9. Assignment.

This Agreement shall not be assigned by Client to another party without the written consent of PEO, which consent shall not be unreasonably withheld. PEO may assign this Agreement without any consent or notice to Client.

17.10. Amendments.

This Agreement can be amended or modified only by written agreement between the parties, provided however that notwithstanding anything to the contrary set forth in this Agreement or this Section, PEO may change any of the terms and conditions in this Agreement, including any fees, upon thirty (30) days’ prior written notice to CLIENT. If the other party is unwilling for the Agreement to continue as amended, it may terminate the Agreement by giving notice to the amending party no later than the effective date of the amendment. For the avoidance of doubt, no unilateral amendment will retroactively modify any binding dispute-resolution provisions of the Agreement for then-pending disputes (for example, binding-arbitration provisions) unless the parties expressly agree otherwise. For the avoidance of doubt, without the Client’s express written agreement, a unilateral amendment will not retroactively eliminate or modify any right already exercised by the non-amending party, including for example any right to demand that the amending party perform an obligation, under the Agreement.

17.11. Notices.

All notices and demands by mail shall be made by certified mail, postage prepaid, return receipt requested or by electronic mail. Notice shall be considered given and effective when mailed, or when transmitted, as applicable. Unless otherwise advised in writing by the other party, each party shall transmit notices and demands to the addresses indicated in the introductory paragraph of this Agreement or to any other such address or e-mail address provided to the other party in writing from time to time.

17.12. No Partnership or Joint Venture.

Nothing herein contained shall be deemed to create a joint venture or partnership between Client and PEO. PEO is an independent contractor of Client and shall not be its principal, director, agent, master, servant, or employee.

17.13. Waiver of Subrogation.

The parties each hereby waive any claim which it or anyone claiming through, or under it, by subrogation or otherwise, might now or hereafter have against the other party on account of any loss or damage which is insured against, to the extent that such loss or damage is recovered under policies of insurance required to be provided hereunder. Each party agrees to immediately give each insurance carrier providing any such policy written notice of the terms of the mutual waiver described above, and to have said insurance policies properly endorsed to reflect such waiver. Each party shall cause its insurance carrier to provide written evidence of said waiver.

17.14. No Construction Against Drafter.

PEO has prepared this Agreement and provided it to Client for Client’s review. Client has either retained counsel or had the opportunity to do so to review this Agreement. With respect to any dispute concerning the meaning of this Agreement, this Agreement shall be interpreted as a whole with reference to its relevant provisions and in accordance with its fair meaning, and no part of this Agreement shall be construed against PEO on the basis that PEO drafted it. This Agreement shall be viewed as if prepared jointly by PEO and Client.

17.15. Counterparts and Fax Signatures.

Any document or instrument entered into, given, or made pursuant to this Agreement or authorized hereby, and any amendment or supplement thereto may be executed in two or more counterparts, and, when so executed, will have the same force and effect as though all signatures appeared on a single document. Any Party may deliver its signature by facsimile or via email, and that signature shall be treated as an original for all purposes. Any signature page of such an amendment, supplement, document, or instrument may be detached from any counterpart without impairing the legal effect of any signatures thereon, and may be attached to another counterpart identical in form thereto but having attached to it one or more additional signature pages.

17.16. False or Omitted Information.

Any false statement or omission with regard to any information supplied by Client to PEO in anticipation of Client’s contracting with PEO or at any other time shall be deemed a material breach of this Agreement and PEO, at its option, may terminate this Agreement and seek appropriate relief.

17.17. Responsibility for Legal Rights.

Client acknowledges and agrees that PEO is not engaged in the practice of law or the provision of legal services, and that Client alone is completely and independently responsible for its own legal rights and obligations. PEO ’s agreement to perform certain employer functions does not establish an obligation to perform all employer related functions, and PEO reserves the right to reject claims by Covered Employees with respect to matters that are not the responsibility of PEO.

17.18. Limitation of Liability.

NEITHER CLIENT NOR PEO WILL BE RESPONSIBLE FOR SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL OR OTHER SIMILAR DAMAGES (INCLUDING WITHOUT LIMITATION, LOST PROFITS OR BUSINESS INTERRUPTION DAMAGES) HOWEVER CAUSED OR UNDER ANY THEORY OF LIABILITY EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

17.19. Scope of Services.

PEO shall provide only the services expressly described in this Agreement. No other services shall be provided or implied. PEO is not obligated to provide, nor is it responsible for, strategic, operational or other business-related decisions with regard to Client’s business. Nor shall PEO have any obligation to provide equipment for the Covered Employees. Covered Employees in supervisory positions shall have no responsibility for employees other than the Covered Employees, nor shall PEO have responsibility or liability for Client’s employees other than the Covered Employees. All services that are subject to applicable PEO licensing, registration, certification and other laws authorizing the delivery of PEO services shall be performed by a PEO party that is licensed, registered or certified in accordance with such laws.

17.20. Terms Surviving Termination of Agreement.

Termination of this Agreement shall not affect the continuation of any outstanding obligation or liability incurred by either party during the term of this Agreement. The obligation of either party to notify, indemnify, defend and hold harmless the other under the terms of this Agreement shall continue after the termination hereof with respect to events occurring prior to such termination. In addition, the following provisions shall survive the termination of this Agreement: Section 5.7 (Cooperation with PEO), Section 6.5 (Interest on Late Payments), Section 8 (Indemnity), Section 15 (Default), Section 6.8 (Deposit), Section 16.5 (Obligations of the Parties), Section 16 (Dispute Resolution), and Section 18.27 (Duty to Cooperate).

17.21. Third Party Beneficiaries.

The parties acknowledge and agree that no parties other than the parties hereto are intended to benefit hereunder. No rights of any third party are created by this Agreement and no person other than parties to this Agreement may rely on any aspect of this Agreement notwithstanding any representation, written or oral, to the contrary.

17.22. Force Majeure.

If PEO is prevented from complying, either totally or in part, with any of the terms or provisions of this Agreement by reason of fire, flood, storm, strike, lockout or other labor trouble, any law, order, proclamation, regulation, ordinance, demand or requirement of any governmental authority, riot, war, rebellion or other causes beyond the reasonable control of PEO or other acts of God, then upon written notice to Client, the affected provisions and/or other requirements of this Agreement shall be suspended during the period of such disability and PEO shall have no liability to Client or its affiliates (or any other party) in connection therewith. PEO shall make all reasonable efforts to remove such disability as soon as reasonably practicable.

17.23. Sufficient Authority and Signatures.

Any individual entering into this Agreement on behalf of Client or PEO represents, warrants and guarantees that she or he has full authority to do so. The parties agree that all future transactions between them may be executed via electronic signature. Thus, neither party will contest an otherwise valid signature on the basis that it was provided electronically.

17.24. Security or Guarantee.

PEO may, at its option, request security from Client. This security may, but is not required to be, in the form of a security deposit or personal guarantee.

17.25. No Inducement.

Client understands, acknowledges and agrees that the PEO services provided pursuant to this Agreement are not being provided as an inducement to purchase insurance coverage of any kind, nor do such services constitute insurance or the sale of insurance of any kind.

17.26. PEO Does Not Provide Legal or Tax Advice.

Client understands, acknowledges and agrees that the PEO services provided pursuant to this Agreement shall not constitute legal or tax advice to Client and Client shall seek all appropriate legal and tax advice from its own legal and tax advisors.

17.27. Duty to Cooperate.

Each party will have the duty to cooperate with the other in the event of any claim filed by a Covered Employee or former Covered Employee, or any government agency investigation of a complaint filed by a Covered Employee or a former Covered Employee who is covered by his Agreement. Such duty will survive the termination of this Agreement. Client agrees to cooperate with PEO as needed for any state licensing and/or registration requirements. Client further agrees to cooperate with PEO as needed for compliance with any additional state statute, regulation, or other requirement not aforementioned or referenced above or below. Such duties will survive the termination of this Agreement.

18. Effective Date.

The actual effective date of this Agreement is the actual first day of the of the first payroll period of the Client where PEO processes payroll for the Covered Employees as defined in the Agreement and Client pays, timely and in full, any and all invoices for related services (the “Effective Date”). This Agreement shall not be in effect nor will PEO be responsible for any workers’ compensation, payroll, related tax computation or payment, general services or duties as described in this Agreement until the Effective Date is confirmed by PEO and that conditions described above are fully met.