EXHIBIT 10.5
CONSULTING AGREEMENT
This Consulting Agreement (the "Agreement") dated as of December 30,
2002, is entered into by and between EMERGENT GROUP INC., a Nevada corporation
(the "Company"), with an address at 000 Xxxxx Xxxxxxx Xxxxxx, Xxxxxxxx,
Xxxxxxxxxx, 00000, JIMA MANAGEMENT, LLC ("Consultant"), with an address at 000
Xxxx Xxxxxx, #000, Xxxxx Xxxxxx, XX 00000 and Xxxx Xxxxxxx ("Xxxxxxx") with an
address at 000 Xxxxx Xxxx Xxxx. #0, Xxxxx Xxxxxx, XX 00000 (JIMA and Xxxxxxx
collectively "Consultants").
RECITALS
WHEREAS, Consultant has certain valuable business experience and
expertise which could benefit the Company; and
WHEREAS, the Company desires to retain the non-exclusive consulting
services of Xxxxxxx, and JIMA MANAGEMENT, LLC desires to provide the services of
Xxxxxxx, and Xxxxxxx is desirous of providing to the Company his services, upon
the terms and conditions herein below set forth; and
WHEREAS, the Company upon Xxxxxxx'x request also desires to compensate
Consultant for Xxxxxxx'x services provided to the Company for the period from
July 1, 2001 to March 31, 2002 during which time Xxxxxxx served as the Company's
Chief Executive Officer and did not receive a salary; and
WHEREAS, Xxxxxxx owns 10,247,377 shares of the Company's par value
$.001, which the Company has agreed to register upon the conditions more
particularly set forth herein. Such 10,247,377 shares of the Company's Common
Stock are herein sometimes called the "Xxxxxxx Stock".
NOW THEREFORE, in consideration of the premises and the mutual covenants and
agreements hereinafter set forth, and for other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the parties hereto
covenant and agree as follows:
1. Scope and Duties of Consultant. Consultant agrees to provide the
Company with the non-exclusive services of Xxxxxxx as may be required by the
Company or its subsidiaries (including, without limitation, Medical Resources
Management, Inc.) from time to time during the Term hereof (as defined below) as
a consultant to the Company.
In providing such services to the Company, Consultants shall report
directly to the Company's Chairman and Chief Executive Officer and the Board of
Directors of the Company. Consultant's duties shall include, but not be limited
to providing advice and guidance generally with respect to various commercial
strategies, management and operational aspects relative to the business of the
Company.
In rendering consulting services pursuant to this Agreement,
Consultants agree to use their ability and experience at all times and to
loyally and conscientiously perform all the duties and obligations required of
them expressly or implicitly by the terms of this Agreement.
2. Term of Agreement. The Company shall retain Consultant to perform
consulting services to the Company, and Consultant hereby agrees to provide such
consulting services to the Company, for a period of nine (9) months, commencing
on January 15, 2003 (the "Term"); provided however, that the provisions of
Section 8 below shall continue in full force and effect after the Term for the
period set forth in such Section 8.
3. Personal Services. Xxxxxxx shall provide the services described in this
Agreement personally and not through any other employee, subcontractor or agent
of Consultant without the express prior written consent of the Company.
4. Remuneration to Consultant. As full and total consideration for
Consultant's services described herein, the Company shall:
(a) pay Consultant a monthly consulting fee (the "Consulting Fee") of
$10,000.00, payable monthly in advance during the Term; and
(b) reimburse Consultant for any approved documented, reasonable
travel, entertainment and out-of-pocket expenses actually incurred by
Consultant in connection with the performance of Consultant's services
on behalf of the Company hereunder and in accordance with Company
policies and procedure during the Term; and
(c) during the period set forth in Section 8, register all of the
shares of the Xxxxxxx Stock as provided in such Section 8.
5. Confidentiality; Inventions; Product Development, Etc.
(a) Restrictions on Proprietary Information. Each of JIMA and Xxxxxxx
acknowledges that (i) because of his responsibilities at Company, Xxxxxxx will
help develop and create, and will be exposed to, Company's business strategies,
information on customers and clients and other valuable confidential,
proprietary and trade secret information of Company (as more fully defined
below, "Proprietary Information"), (ii) in such capacity Xxxxxxx will become
familiar with procedures and methods by which Company develops and conducts its
business, (iii) Xxxxxxx will have access to Company's clients, channels for
developing clients, and other Proprietary Information, (iv) it would be unfair
to Company if Xxxxxxx or JIMA were to appropriate to himself or itself or others
the benefits of Company's resources expended to develop such business
relationships, (v) it would be unfair to Company if Xxxxxxx or JIMA were to
appropriate to himself or itself or others the benefits of the business which
are critical to the success and survival of Company, and personnel and other
Proprietary Information which Company has developed and continues to develop in
the conduct of its business, and (vi) it is therefore fair that reasonable
restrictions should be placed on certain of Xxxxxxx'x activities during and
after the term of this Agreement.
All Proprietary Information shall be the sole property of Company, and
Company shall be the sole owner of all patents, copyrights, and other rights in
connection therewith. Xxxxxxx and JIMA hereby assign to Company any rights he or
it may have or acquire in such Proprietary Information. At all times, both
during the term of this Agreement and after its termination for whatever reason,
Xxxxxxx and JIMA will keep in strictest confidence and trust all Proprietary
Information, and Xxxxxxx and JIMA will not use or disclose any Proprietary
Information except as may be necessary in the ordinary course of Xxxxxxx
performing his duties hereunder, as determined by Xxxxxxx. Except as required in
his authorized duties on behalf of Company, Xxxxxxx will not (and JIMA shall
not) use, copy, publish, summarize, or remove from Company's premises
Proprietary Information, or remove from the premises any other property of the
Company. In the event of termination of this Agreement for any reason, Xxxxxxx
and JIMA will deliver to Company all documents, notes, drawings, specifications,
data, and other materials of any nature pertaining to Xxxxxxx'x work with
Company and/or containing Proprietary Information, and Xxxxxxx and JIMA will not
take with him or it any of the foregoing, any reproduction of any of the
foregoing, or any Proprietary Information that is embodied in a tangible medium
of expression. Xxxxxxx and JIMA agree that client or customer lists, business
contracts and related items are the property of Company.
(b) Definition of Proprietary Information. "Proprietary Information"
means all information and any idea in whatever form, tangible or intangible,
whether disclosed to or learned by Xxxxxxx or JIMA, pertaining in any manner to
the business of Company (or any of its affiliates) including, without
limitation: (i) client lists, client prospects, and business development
information; (ii) company lists, profiles and reports; (iii) training and
research materials and methodologies; (iv) structure, operations, pricing,
financial and personnel information; (v) information systems design and
procedures; (vi) computer technology designs, hardware configuration systems,
and software designs and implementations; (vii) information databases,
interactive procedures, navigation, functionality, web site design,, tests,
analysis and studies developed by or for the benefit of Company; (viii) plans,
designs, inventions, formulas, research and technology developed by or for the
benefit of Company; (ix) business information and business secrets of Company
and its clients; (x) trade secrets of Company; (xi) plans, prospects, policies,
practices, and procedures of Company which are not generally known in the
industry; (xii) licenses and agreements of any nature; and (xiii) all other
proprietary and confidential information of every nature and source. Proprietary
Information does not include information which: (A) is or becomes generally
available to the public through no breach of this Agreement or any other
agreement to which Company or JIMA is a party; (B) was received from a third
party free to disclose such information without restriction; (C) is approved for
release in writing by the Board, subject to whatever conditions are imposed by
the Board; or (D) is required by law or regulation to be disclosed, but only to
the extent necessary and only for the purpose required. The foregoing definition
of Proprietary Information shall not be deemed to include an idea developed by
Xxxxxxx in the exercise of his own mental faculties unless specifically and
exclusively developed for the use of the Company.
(c) Third-Party Information. Each of Xxxxxxx and JIMA acknowledges that
Company has received and in the future will receive from third parties their
confidential information subject to a duty on Company's part to maintain the
confidentiality of this information and to use it only for certain limited
purposes. Each of Xxxxxxx and JIMA agrees that they owe Company and these third
parties, during and after the term of this Agreement, a duty to hold all such
confidential information in the strictest confidence and not to disclose or use
it, except as necessary to perform any obligations hereunder and as is
consistent with Company's agreement with third parties.
(d) Inventions. Xxxxxxx will promptly disclose to Company (or any
persons designated by it) all processes, formulas, data, computer programs,
software and documentation, know-how, improvements, discoveries, developments,
designs, algorithms, inventions, techniques, strategies and new products,
whether or not patentable or registrable under copyright or similar statutes,
made or conceived or reduced to practice or learned by Xxxxxxx, either alone or
jointly with others, during the period of his employment that are related to or
useful in the business of Company, result from tasks assigned to Xxxxxxx by
Company, or result from the use of premises owned, leased, or contracted for by
Company (all such processes, formulas, data, computer programs, software and
documentation, know-how, improvements, discoveries, developments, designs,
algorithms, inventions, techniques, strategies and new products are hereinafter
referred to as "Inventions"). Xxxxxxx will also promptly disclose to Company,
and Company hereby agrees to receive all such disclosures in confidence, all
other processes, formulas, data, computer programs, software and documentation,
know-how, improvements, discoveries, developments, designs, algorithms,
inventions, techniques, strategies and new products, whether or not patentable
or registrable under copyright or similar statutes, made or conceived or reduced
to practice or learned by Xxxxxxx, either alone or jointly with others, during
the period of his employment for the purpose of determining whether they
constitute "Inventions", as defined above.
Each of Xxxxxxx and JIMA agrees that all Inventions shall be the sole
property of Company, and Company shall be the sole owner of all patents,
copyrights, and other rights in connection therewith. Each of Xxxxxxx and JIMA
hereby assigns to Company any rights he or it may have or acquire in such
Inventions. Each of Xxxxxxx and JIMA also hereby waives all claims to moral
rights in any Invention. Each of Xxxxxxx and JIMA further agrees as to all such
Inventions to assist Company as may be reasonably required (but at Company's
expense) to obtain and from time to time enforce patents, copyrights, and other
rights and protections relating to said Inventions in any and all countries, and
to that end each of Xxxxxxx and JIMA will execute all documents for use in
applying for and obtaining such patents, copyrights, and other rights and
protections on and enforcing such Inventions, as Company may desire, together
with any assignments thereof to Company or persons designated by it. Xxxxxxx'x
and JIMA's obligation to assist Company in obtaining and enforcing patents,
copyrights, and other rights and protections relating to such Inventions in any
and all countries shall continue beyond the termination of this Agreement, but
Company shall compensate JIMA at a reasonable rate after the termination hereof
for time actually spent by Xxxxxxx at Company's request on such assistance,
provided: that such assistance shall not interfere with Xxxxxxx'x subsequent
employment. In the event Company is unable, after reasonable effort, to secure
Xxxxxxx'x or JIMA's signature on any document or documents needed to apply for
or prosecute any patent, copyright, or other right of protection relating to an
Invention, for any reason whatsoever, each of Xxxxxxx and JIMA hereby
irrevocably designates and appoints Company and its duly authorized officers and
agents as his agent and attorney-in-fact, to act for and in his or its behalf
and stead to execute and file any such application or applications and to do all
other lawfully permitted acts to further the prosecution and issuance of
patents, copyrights, or similar protections thereon with the same legal force
and effect as if executed by Xxxxxxx and JIMA. The foregoing definition of
Inventions shall not be deemed to include an idea developed by Xxxxxxx in the
exercise of his own mental faculties unless specifically and exclusively
developed for the use of the Company.
(e) Records of Invention Ideas. Xxxxxxx agrees to maintain adequate and
current written records on the development in connection with his employment of
all technology, ideas, and inventions, collectively referred to in this
Agreement as "Invention Ideas," and to disclose promptly to Company all
Invention Ideas and relevant records, which records will remain the sole
property of Company.
(f) Assignment. Subject to Section 5(g), each of Xxxxxxx and JIMA
agrees to assign to Company, without further consideration, his entire right,
title, and interest (throughout the United States and in all foreign countries),
free and clear of all liens and encumbrances, in and to each Invention Idea,
which shall be the sole property of Company, and, to the maximum extent
permitted by applicable law, shall be deemed works made for hire. In the event
any Invention Idea shall be deemed by Company to be patentable or otherwise
registrable, each of Xxxxxxx and JIMA will assist Company (at its expense) in
obtaining letters patent or other applicable registrations thereon and Xxxxxxx
and JIMA will execute all documents and do all other things (including
testifying at Company's expense) necessary or proper to obtain letters patent or
other applicable registrations thereon and to vest Company with full title
thereto. Should Company be unable for any reason to secure Xxxxxxx'x or JIMA's
signature on any document necessary to apply for, prosecute, obtain or enforce
any patent, copyright, or other right or protection relating to any Invention
Idea, whether due to Xxxxxxx'x mental or physical incapacity or any other cause,
each of Xxxxxxx and JIMA hereby irrevocably designates and appoints Company and
each of its duly authorized officers and agents as their agent and
attorney-in-fact, to act for and in his behalf and stead, to execute and file
any such document, and to do all other lawfully permitted acts to further the
prosecution, issuance, and enforcement of patents, copyrights, or other rights
or protections with the same force and effect as if executed and delivered by
him. The power-of-attorney granted pursuant to this section 8(f) is coupled with
an interest and is irrevocable.
(g) License for Other Inventions. Except as Company may otherwise
agree, if, in the course of this Agreement, Xxxxxxx incorporates into Company
property an Invention Idea owned by Xxxxxxx or JIMA or in which Xxxxxxx or JIMA
has an interest, Company is granted a nonexclusive, royalty-free, irrevocable,
perpetual, worldwide license to make, modify, use and sell his Invention Idea as
part of and in connection with Company property.
(h) Patent and Copyright Registration. Each of Xxxxxxx and JIMA agrees
to assist Company, or its designee, at Company's expense, in every proper way to
secure Company's rights in the Invention Ideas and any copyrights, patents, mask
work rights or other intellectual property rights relating thereto in any and
all countries, including the disclosure to Company of all pertinent information
and data with respect thereto, the execution of all applications,
specifications, oaths, assignments and all other instruments which Company shall
deem necessary in order to apply for and obtain such rights and in order to
assign and convey to Company, its successors, assignees, and nominees the sole
and exclusive rights, title and interest in and to such Invention Ideas, and any
copyrights, patents, mask work rights or other intellectual property rights
relating thereto. Each of Xxxxxxx and JIMA further agrees that the obligation to
execute or cause to be executed, when it is in his power to do so, any such
instrument or papers shall continue after the termination of this Agreement.
6. Non-Competition; Non-Solicitation
(a) Each of Xxxxxxx and JIMA hereby agrees and covenants that during
the Term hereof and for a period of six (6) months thereafter that they will not
directly or indirectly engage in or become interested (whether as an owner,
principal, agent, stockholder, member, partner, trustee, venturer, lender or
other investor, director, officer, employee, consultant or through the agency of
any corporation, limited liability company, partnership, association or agent or
otherwise) in any business enterprise which is engaged in the current business
of the Company during the Term, it being agreed that the current business of the
Company is the rental of surgical equipment to healthcare providers on a per
procedure basis; provided, however, that ownership of not more than 5% of the
outstanding securities of any class of any entity that are listed on a national
securities exchange or traded in the over-the-counter market shall not be
considered a breach of this Section 6.
(b) Each of Xxxxxxx and JIMA agrees and covenants that during the Term
hereof and for a period of six (6) months immediately thereafter, they
and their agents will not (without first obtaining the written
permission of Company) directly or indirectly participate in the
solicitation of any business of any type conducted by Company during
the period of this Agreement from any person or entity which was a
client or customer of Company during the period of this Agreement, or
was a prospective customer of Company from which Xxxxxxx solicited
business or for which a proposal for submission was prepared during the
period.
(c) Each of Xxxxxxx and JIMA agrees and covenants that during the Term and
for a period of six (6) months following this Agreement they will not
(without first obtaining the written permission of Company) directly or
indirectly hire, recruit for employment, or induce or seek to cause
such person to terminate his or her employment with Company, any person
who then is an employee of Company or who was an employee of Company
during the preceding six (6) months.
7. Status as Independent Contractor. Consultants' engagement pursuant to
this Agreement shall be as independent contractors and not as an employee, or
other agent of the Company. Neither party to this Agreement shall represent or
hold itself out to be an employer or employee of the other. Consultants
acknowledge that the compensation provided in Section 4 hereinabove is a gross
amount of compensation and that the Company will not withhold from such
compensation any amounts respecting income taxes, social security payments or
any other payroll taxes. Consultants expressly agree that all such income taxes
and payments shall be made or provided for by Consultants and that the Company
shall have no responsibility or duties regarding such matters whatsoever.
Consultants acknowledge that their complete compensation for consulting services
is set forth in Section 4 hereinabove and that, except as otherwise set forth in
Section 4 hereof, they shall not receive any benefits, including, but not
limited to medical benefits and the ability to participate in any pension plans.
8. Incidental Registration. For so long as BJH Management, LLC and/or Xxxxx
X. Xxxxx and/or Xxxxx Xxxxxx, shall have registration rights regarding the
Common Stock of the Company whether pursuant to that certain Stock Issuance
Agreement dated December 30, 2002, or otherwise, if the Company, at any time
during such period proposes to file on its behalf and/or on behalf of any of its
security holders a registration statement under the Securities Act of 1933, as
amended on any form (other than a registration statement on Form S-4 or S-8 or
any successor form for securities to be offered in a transaction of the type
referred to in Rule 145 under the Securities Act of 1933 or to the Company's
employees pursuant to any employee benefit plan, respectively) for the general
registration of securities to be sold for cash with respect to the Company's
Common Stock, it will give written notice to Xxxxxxx at least 30 days before the
initial filing with the Securities and Exchange Commission of the registration
statement, which notice shall set forth the intended method of disposition of
the securities that the Company proposes to register. The notice shall offer to
include in such filing the aggregate number of shares of the Xxxxxxx Stock as
Xxxxxxx, or his transferees may request. Xxxxxxx or his transferees shall advise
the Company in writing within 20 days after the date of receipt of such offer
from the Company, setting forth the amount of Xxxxxxx Stock for which
registration is asked. The Company shall thereupon include in such filing the
number of shares of the Xxxxxxx Stock for which registration is so asked.
9. Waiver. The waiver by either party of a breach of any provision of
this Agreement shall not operate or be construed as a continuing waiver of any
subsequent breach by either party. No waiver by either party of any provision or
condition to be performed shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same time or any prior or subsequent time.
10. Notices. Any and all notices, demands or requests required or
permitted to be given under this Agreement shall be given in writing and sent,
by registered or certified U.S. mail, return receipt requested, by hand, or by
overnight courier, addressed to the parties hereto at their addresses as set
forth below or such other addresses as they may from time-to-time designate by
written notice, given in accordance with the terms of this Section, together
with copies thereof as follows:
In the case of the Company, to:
Xxxx XxXxx
Chief Financial Officer
Emergent Group Inc.
000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
With a copy simultaneously by like means to:
Xxxxxx Xxxxx, P.C.
000 Xxxxx Xxxx Xxxx, Xxxxx 00
Xxxxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxx, Esq.
And
Xxxxx X. Xxxxx
BJH Management, LLC
000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxxx, XX 00000
In the case of Consultant or Xxxxxxx, to:
JIMA MANAGEMENT, LLC
000 Xxxx Xxxxxx, #000
Xxxxx Xxxxxx, XX 00000
Attn: Xxxx Xxxxxxx
Notice given as provided in this Section shall be deemed effective: (i) on the
date hand delivered, (ii) on the first business day following the sending
thereof by overnight courier, and (iii) on the seventh calendar day (or, if it
is not a business day, then the next succeeding business day thereafter) after
the depositing thereof into the exclusive custody of the U.S. Postal Service.
11. Choice of Law. Regardless of the place of execution or performance,
this Agreement shall be governed by and construed and enforced in accordance
with the laws of the State of New York, without giving effect to such State's
conflicts of laws provisions.
12. Jurisdiction and Venue. Any controversy or claim arising out of or
relating to this Agreement, or the alleged breach thereof, or relating to
Consultants' activities or remuneration under this Agreement, shall be settled
by a court of competent jurisdiction in the State of New York, County of New
York. Each of the parties hereto irrevocably consents to the jurisdiction of the
Federal and State Courts located in the State of New York, County of New York.
The parties hereby knowingly, irrevocably, voluntarily and intentionally waive
any right they may have to a trial by jury in respect of any action, proceeding
or counterclaim based on this Consulting Agreement or the transactions
contemplated in it, or any course of conduct, course of dealing, statements
(whether verbal or written) or actions of any party to it.
13. No Assignment by Consultant. Consultants may not assign or delegate
any of their rights, duties or obligations under this Agreement without the
express prior written consent of the Company.
14. Entire Agreement. This Agreement embodies and constitutes the full
and complete understanding and agreement of the parties with respect to the
Consultant's services for the Company, whether oral or written between
Consultants and the Company, and shall not be amended, modified or changed
except by an instrument in writing executed by the party to be charged. The
invalidity or partial invalidity of one or more provisions of this Agreement
shall not invalidate any other provision of this Agreement.
15. Binding Effect. This Agreement shall inure to the benefit of, be
binding upon and enforceable against, the parties hereto and their respective,
permissible successors, heirs, beneficiaries and permitted assigns.
16. Headings. The headings contained in this Agreement are for
convenience of reference only and shall not affect in any way the meaning or
interpretation of this Agreement.
17. Counterparts. This Agreement may be executed simultaneously in one
or more original or facsimile counterparts, each of which shall be deemed an
original, but all of which when taken together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first set forth above.
EMERGENT GROUP INC.
By: /s/ Xxxxxxx X. XxXxx
Name: Xxxxxxx X. XxXxx
Title: Chief Financial Officer
JIMA MANAGEMENT, LLC
By: /s/ Xxxx Xxxxxxx
Title: President
/s/ Xxxx Xxxxxxx
Xxxx Xxxxxxx as an
individual
