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Amended And Restated Training Services Agreement

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Exhibit 10.99.2


AMENDED AND RESTATED


TRAINING SERVICES AGREEMENT


THIS AMENDED AND RESTATED TRAINING SERVICES AGREEMENT (this "Agreement") is made and entered into as of the 1st day of January, 1997 by and between YOUTH SERVICES INTERNATIONAL, INC., a Maryland corporation having its principal offices at 2 Park Center Court, Suite 200, Owings Mills, Maryland 21117 ("YSI") and INTERNATIONAL YOUTH INSTITUTE, INC., a Maryland corporation having its principal offices at 901 N. Pitt Street, Suite 250, Alexandria, Virginia 22314 ("IYI").


WHEREAS, YSI and IYI previously have entered into that certain Training Services Agreement dated as of July 3, 1996 (the "Original Agreement") pursuant to which YSI engaged IYI to perform certain training services in connection with the business of YSI and the parties set forth the terms of certain elective engagements of IYI by YSI;


WHEREAS, the parties desire to amend certain of the provisions of the Original Agreement arid to restate the entire agreement of the parties in connection with the subject matter of the Original Agreement to include such amendments;


NOW, THEREFORE, in consideration of these premises and the mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto, intending to be legally bound, agree as follows:


1. Termination of Original Agreement. Each of IYI and YSI understands and
--------------------------------- agrees that upon the execution of this Agreement by both parties hereto, the Original Agreement shall automatically terminate and cease to exist and each of the terms and provisions of the Original Agreement shall be of no further force or effect. The parties hereto further understand and agree that the subject matter of the Original Agreement shall be governed by the terms and provisions of this Agreement.


2. Scope of Services; Standard.
---------------------------


(a) During the term of this Agreement, YSI hereby engages IYI to perform, and IYI hereby agrees to perform, the services set forth and described on Exhibit A attached hereto and made a substantive part hereof (the "Tier I - --------- Services"). The Tier I Services shall be provided during the term of this Agreement at such times arc in such manner as is reasonably necessary in order to meet or exceed the training requirements for the personnel who are the subject of the Tier I Services, as such requirements may be set forth by any state or other governmental


body or other authority having rules or regulations applicable to the training of such personnel. During the term off this Agreement, IYI shall have the exclusive right to perform Tier I Services with respect to all employees of YSI and its direct and indirect subsidiaries, and neither YSI nor any of its direct or indirect subsidiaries shall be permitted, during the term of this Agreement, to perform any Tier I Services, or to engage any third party to perform Tier I Services, with respect to any employee of YSI or any of its direct or indirect subsidiaries.


(b) From time to time during the term of this Agreement, IYI also agrees perform the services (or any portion thereof) set forth and described on Exhibit
------- B attached hereto and made a substantive part hereof (the "Tier II Services") in - - each instance if and only if IYI is the winning bidder for such services in accordance with the Tier II Service Bidding Process set forth in Section 3 hereof. YSI shall not be required to contract for any Tier II Services at any time during the term of this Agreement, and in the event that YSI elects to have any Tier II Services conducted with respect to its personnel, IYI shall have no right to perform such Tier II Services except as set forth in Section 3 below.


(c) The Tier I Services and the Tier 11 Services provided by IYI pursuant to this Agreement (collectively, the "Services") shall comply with established and accepted standards applicable to the training of personnel working in facilities such as those operated by YSI and its subsidiaries, subject to the guidelines of any applicable governmental bodies or other authorities and the general guidelines of the industry.


(d) IYI shall have the right to provide Tier I Services and to submit bids to provide Tier II Services (in accordance with Section 3 below) with respect to all employees of governmental authorities or other third parties who enter into joint venture agreements with YSI or any of its subsidiaries if pursuant to such agreement such employees will be providing the same type of services provided by the personnel of YSI or its subsidiaries whose training is covered by this Agreement; provided that in the event that the agreement between YSI and any such governmental authority or other third party prohibits YSI from engaging third parties to conduct the training of personnel or otherwise restricts the provision of such services by IYI, then IYI's rights under this Agreement shall riot extend to any employees or other personnel governed by such governmental or third party agreement.


3. Tier II Service Bidding Process. In the event that, at any time and
------------------------------- from time to time during the term of this Agreement, YSI requires Tier II Services, such Tier II Services shall, in each instance, be provided as follows:


(a) YSI may elect to provide such services internally without engaging any third party to conduct or assist in the conduct of such services, which election shall not require notice at any time to IYI.


(b) In the event that YSI does not elect to provide the Tier II Services internally, YSI must give notice to IYI stating a description of the desired Tier II Services including the time frame for the provision of such services, the deadline for the submission of a bid to provide such services and the name of the party at YSI to whom a bid shall be submitted. Such notice shall be provided to IYI prior to or simultaneous with any notice or request to any third party to provide such Tier II Services. In the event that IYI desires to perform such Tier II Services (it being understood that IYI shall not be required to submit any bid), on or before the deadline set forth in the notice, IYI shall submit to the party at YSI set forth in the notice its written bid to provide such services. YSI shall review IYI's bid along with any other bids it receives.


(c) In the event that YSI desires to select a provider other than IYI to perform the Tier II Services YSI shall give written notice to IYI of such desire prior to giving notice to such other provider, which notice shall contain an - -------- outline of the bid submitted to YSI by such other third party provider. IYI shall then have 30 days to resubmit its bid in an effort to make its bid more attractive to YSI than the bid of such other third party provider. YSI shall be permitted thereafter to engage the services of the other third party provider if and only if the bid submitted by such third party provider remains more attractive to YSI than IYI's resubmitted bid based on pricing, experience, training quality or some other appropriate factor.


4. Professional Service Fees --Tier I Services.
-------------------------------------------


(a) Subject to the provisions of Section 11 below, YSI shall pay to IYI, in consideration of the Tier I Services, a monthly fee equal to the following:


Period Selection of Monthly Fee
------ ------------------------


January - December 1997 Program FTE's x $46
January - December 1998 Program FTE's x $37
January - December 1999 Program FTE's x $34
January - December 2000 Program FTE's x $33
January - December 2001 Program FTE's x $32


(b) Program FTE's for the purposes of the monthly payment will be computed by YSI consistent with its historical reporting based upon Program FTE's as of the end of the previous month. Program FTE's for the purposes hereof are defined as (i) the number of employees on YSI's payroll that are scheduled for 40 hours per week other at YSI's youth care programs; plus ((ii) the total scheduled hours per week for all part time employees on YSI's payroll other than employees allocated at the corporate headquarters of YSI divided by 40.


(c) Monthly payments shall be made by YSI in arrears in the form of a company check made payable to IYI and mailed to IYI at the address set forth in the opening paragraph of this Agreement each month on or before the 5th day of the following of each month; provided, however, that payment for the months of January, February and March, 1997 shall be made on the date hereof (it being understood that no payment shall be made on April 5, 1997, and payments in accordance with this paragraph(c) will resume on May 5, 1997). Together with each monthly payment, YSI shall submit to IYI a schedule showing the calculation of the number of Eligible Program FTEs for such month.


5. Professional Services Fees -- Tier II Services. In the event that,
---------------------------------------------- during the term of this Agreement, IYI provides any Tier II Services, the fees for such services shall be as set forth in the final bid of IYI accepted by YSI in accordance with the provisions of Section 3 hereof. IYI shall invoice YSI for such Tier II Services on a monthly basis.


6. Term of Agreement. The term of this Agreement shall be five years,
----------------- beginning on January 1, 1997 and ending on December 31, 2001, unless sooner terminated pursuant to the provisions of section 7 hereof.


7. Termination.
-----------


(a) By Either Party. Either party may terminate this Agreement at any
--------------- time during the term
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