Master Service Agreement

1. Nature of Services (Staff Augmentation)

Vance & Cole is a managed services provider for the US accounting and tax preparation industry. We supply dedicated, full-time offshore accounting professionals ("Managed Staff") who integrate into the Client's existing workflow. All personnel work from our ISO 27001-aligned cleanroom facilities in Cebu IT Park, Philippines.

Service Provider is a staff augmentation firm, not a licensed US CPA firm. We provide processing capacity but do not issue final accounting, attest, or legal assurance opinions. All final work product and taxpayer sign-offs remain the Client's legal responsibility.

2. Fees and Payment Terms

Client shall pay Service Provider the monthly B2B retainer fees as set forth in the applicable Statement of Work (SOW). Billing operates on a flat-rate monthly cycle corresponding to the allocated capacity.

Invoicing: All invoices are issued electronically and due Net-15 days from issue date unless the SOW states otherwise. Balances unpaid beyond 30 days incur a late fee of 1.5% per month (or the legal maximum, whichever is lower). Service Provider may suspend services without penalty upon significant delinquency.

3. Non-Solicitation & Restrictive Covenants

During this Agreement and for 24 months after termination, Client shall not directly or indirectly solicit, hire, or recruit any Managed Staff or internal employees without executing a "Direct Hire Buyout Agreement."

Buyout Clause Penalty: If Client breaches this provision or wishes to purchase a Managed Staff contract, Client pays a buyout fee equal to 12 months of that professional's annualized billing rate. This compensates for Vance & Cole's recruitment, training, and talent retention investment.

4. Confidentiality & Non-Disclosure

Both parties shall keep all proprietary information confidential, including Client Data, firm methodologies, pricing models, and security blueprints. Neither party may disclose Confidential Information except as needed to perform under this Agreement or as required by law. This obligation survives termination perpetually for trade secrets.

5. Data Security & IRS Compliance

Because Service Provider interacts with sensitive financial data, we enforce a Zero-Trust operational architecture compliant with GLBA and IRS-WISP administrative safeguards. Vance & Cole strictly provisions all production hardware with:

• Hardware-enforced BitLocker/FileVault encryption.
• Physically and digitally disabled USB and peripheral mass storage capabilities.
• IP-restricted static network routing securely tunneling directly to US infrastructure.

IRS Section 7216: If Vance & Cole personnel prepare US federal tax returns, Client is solely responsible for obtaining written taxpayer consent before sharing tax data with offshore personnel, per IRC Section 7216 and Treasury Regulations.

6. Insurance & Limitation of Liability

Except for E&O policy liabilities or indemnification obligations, neither party's aggregate liability shall exceed the total retainer fees paid under the applicable SOW during the 3 months before the claim. Neither party is liable for indirect, punitive, or consequential damages.

7. Mutual Indemnification

Both parties indemnify each other against third-party claims from gross negligence, willful misconduct, or confidentiality breaches. Client specifically indemnifies Service Provider against damages from erroneous Client Data or unreviewed IRS transmissions.

8. Term & Termination

Service Provider operates primarily on flexible monthly retainers to ensure performance accountability. Either party may terminate this Agreement without cause by providing thirty (30) days formal written notice.

Upon termination, Service Provider shall immediately revoke system access and assist Client in a smooth, secure transition of any residual Client Data off our infrastructure in alignment with strict deletion protocols.

9. Independent Contractor Status

All offshore personnel are employed by Vance & Cole (or its APAC subsidiaries). Velmer Digital LLC is an independent contractor to Client. This Agreement does not create a partnership, joint venture, agency, or employment relationship between Client and Service Provider's personnel.

10. Dispute Resolution (Binding Arbitration)

Any dispute arising from this Agreement shall be resolved by binding, confidential arbitration through the American Arbitration Association (AAA) under its Commercial Arbitration Rules. Client waives the right to court proceedings, jury trials, and class-action or consolidated litigation.

11. Force Majeure

Service Provider is not liable for failures beyond its reasonable control, including natural disasters (e.g., typhoons), internet infrastructure collapse, acts of war, or pandemics. Billing may be paused proportionally during extended Force Majeure events.

12. Governing Law

This Agreement shall be governed by and construed in accordance with the laws of the State of New Mexico, USA, without giving effect to any choice or conflict of law provision. The arbitration locale, or jurisdictional venue for matters exempt from arbitration, shall explicitly be Bernalillo County, New Mexico.