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EXHIBIT 10.12
CONSULTING AGREEMENT
This Consulting Agreement (this "Agreement") is made as of March 1,
2001, between Metropolitan Health Networks, Inc., a Florida Corporation (the
"Company"), and The Shemano Group, a California Corporation ("Shemano"). Shemano
and the Company agree:
I. ENGAGEMENT OF SHEMANO AS FINANCIAL ADVISOR.
A. DUTIES. The Company hereby engages Shemano, and
Shemano hereby accepts such engagement, to act as a
non-exclusive financial advisor to the Company. In
such capacity, Shemano shall be available for advice,
and shall advise the Company with respect to such
financial matters as the Company shall from time to
time request in writing, including matters relating
to (a) capital raising, whether from institutional
and other investors or lenders or from the private
placement of debt instruments or equity securities,
(b) public offerings of"debt or equity, (c) structure
of debt or equity financings, (d) subject to
subsection I (c) below, mergers and acquisitions and
other business ventures, (e) stockholder and
securities dealer relations, (f) commercial banking
relations, and (g) preparation of corporate finance
report. It is expressly understood and agreed that
Shemano will not have any obligation to conduct, or
cause to be conducted, due diligence with respect to
the Company or any transaction or proposed
transaction involving the Company.
B. COMPENSATION FOR FINANCIAL ADVISORY SERVICES.
ln consideration for the services rendered by Shemano
for its financial advisory services, the Company
shall (1) immediately deliver to Shemano 200,000
warrants to purchase shares of Metropolitan Health
Networks, Inc. at $2.25 (subject to equitable
adjustment for stock splits, stock dividends and
similar events). The warrants shall vest 100% on the
date of grant. The company shall, within ninety days
of the closing of the Offering, prepare and file with
the Securities and Exchange Commission ("SEC') a
registration statement with respect to such
Registerable Securities and use it best efforts to
cause such registration to become effective. Upon the
effectiveness of the Registration Statement, the
Metropolitan Health Networks common stock which
Shemano will receive as a result of exercising the
above warrants shall have no restrictions such that
they are freely tradable common shares.
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C. COMPENSATION FOR ADVICE ON MERGER AND ACQUISITIONS.
If the Company requests Shemano's assistance with
regard to any merger or acquisition, the Company will
pay Shemano on a project by project basis according
to terms and conditions customary in the industry for
similar projects, such fee to be agreed to in writing
prior to the commencement of each assignment.
D. TERMINATION OF AGREEMENT. Either party may terminate
this agreement by notifying the other party in
writing upon a material breach by the other party,
unless such breach is curable and is in fact cured
within 15 days after such notice. This Agreement will
terminate after 12 months from its execution. Either
party may terminate this Agreement with 30 days'
prior written notice.
E. INDEMNIFICATION. The Company warrants and represents
that all -al communications, written documents or
materials furnished to Consultant by the Company are
accurate, and the financial affairs, operations,
profitability and strategic planning of the Company
are in accordance with information provided to it by
the Company. The Consultant may rely upon the
accuracy of the information provided by the Company
without independent investigation. The Company and
Consultant will each protect, indemnify and hold each
other harmless against any claims or litigation
including any damages, liability, cost and reasonable
attorney's fees as incurred 'in connection with this
engagement arising out of the acts or omissions of
the other party.
F. NOTICES. Any notice, consent, authorization or other
communication to be given hereunder shall be in
writing and shall be deemed duly given and received
when delivered personally, three days after being
mailed by first class, or one day after being sent by
a nationally recognized overnight delivery service,
charges and postage prepaid, properly addressed to
the party to receive such notice, at the following
address for such party (or at such other address as
shall hereafter be specified by such party by like
notice):
(A) If to the COMPANY to:
Metropolitan Health Networks, Inc.
Xxxx Xxxxxxxxx, President & Chief
Executive Officer
000 Xxxxxxxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxx Xxxx Xxxxx, XX 00000
Phone (000) 000 0000
XXXX@XXXXXXX.XXX
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(B) If to Shemano, to:
Xx. Xxxx Xxxxxxx, President
The Shemano Group, Inc.
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Phone (000) 000-0000
Fax (000) 000-0000
XXXXXXXX@XXXXXXX.XXX
G. CONFIDENTIALITY OF COMPANY INFORMATION. Shemano, and
its officers, directors, employees and agents shall
maintain in strict confidence and not copy, disclose
or transfer to any other party (1) all confidential
business and financial information regarding the
Company and its affiliates, including without
limitation, projections, business plans, marketing
plans, product distribution, and terms or
identification of proposed or actual contracts and
(2) all confidential technology of the Company,
including without limitation, software, deliverables,
documentation designs, graphics, screens, interfaces,
linkages, keystroke sequences, programming
techniques, tools, methodologies, source code, object
code, programs, codes, algorithms, modules,
platforms, system architecture, file structures,
interfaces, the "look and feel" of the systems,
specifications, know-how, and trade secrets, research
and development reports, speed enhancement, graphics
storage, encryption and security techniques
(including all technology relating to electronic
commerce, gateway and Internet applications). In
furtherance of the foregoing, Shemano agrees that it
shall not transfer, transmit, distribute, download or
communicate, in any electronic, digitized or other
form or media, any of the confidential technology of
the Company. The foregoing is not intended to
preclude Shemano from utilizing any documents
prepared or approved by the Company for use in a
securities transaction or other financing
arrangement.
All communications regarding any possible
transactions, requests for due diligence or other
information, requests for facility tours, product
demonstrations or management meetings, will be
submitted or directed to Xxxx Xxxxxxxxx, President &
CEO, and Shemano shall not contact any employees,
customers, suppliers or contractors of the Company or
its affiliates without express permission. Nothing in
this Agreement shall constitute a grant of authority
to Shemano or any representatives thereof to remove,
examine or copy any particular document or types of
information regarding the Company, and the Company
shall retain control over the particular documents or
items
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to be provided, examined or copies. If the
transaction is not consummated, or if at any time the
Company so requests, Shemano and its representatives
will return to the Company all copies of information
regarding the Company in their possession.
The provisions of this Section shall survive any
termination of this Agreement. Shemano acknowledges
that irreparable injury will be sustained by the
Company in the event of a violation by Shemano of any
of the provisions of this Section, and by reason
thereof, Shemano consents and agrees that the Company
shall be entitled to an injunction to be issued b any
court of competent jurisdiction restraining Shemano
and its representatives from committing or continuing
any such violation, without necessity of posting a
bond or proving special damages or irreparable
injury.
H. EXPENSES ETC. In addition to any fees that may be
payable to Shemano under this Agreement, the Company
will reimburse Shemano for reasonable travel and
other out-of-pocket expenses incurred in performing
services directed hereunder with prior written
approval. Such expenses shall be submitted on a
monthly basis and reimbursed upon receipt.
I. COMPLIANCE WITH LAWS. Shemano represents and warrants
that it is a registered broker/dealer with the SEC,
NASD and the State of California as and shall
maintain such registrations as well as all other
necessary licenses and permits to conduct its
activities under this Agreement which it shall
conduct in compliance with applicable federal and
state laws. Shemano represents that it is not a party
to any other agreement, which would conflict with or
interfere with the terms and conditions of this
Agreement.
J. INDEPENDENT CONTRACTOR. Shemano is and will hereafter
act as an independent contractor and consultant to
the company and not as an employee of the Company and
nothing in this Agreement shall be interpreted or
construed to create any employment, partnership,
joint venture, or other relationship between Shemano
and the Company. Shemano will not hold itself out as
having, and will not state to any person that Shemano
has, any relationship with the Company other than an
independent contractor, Shemano shall have no right
of power to find or create any liability or
obligation for or in the name of the Company or to
sign any document on behalf of the Company.
K. ASSIGNMENT PROHIBITED. No assignment of this
Agreement shall be made without the prior written
consent of the other party.
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L. AMENDMENTS. Neither party may amend this Agreement or
rescind provisions without the prior written consent
of the other party.
M. GOVERNING LAW. This Agreement shall be deemed to have
been made in the State of California and shall be
construed, and the rights and liabilities determined,
in accordance with the law of the State of
California, without regard to the conflicts of laws
rules of such jurisdiction.
N. WAIVER. Neither Shemano's nor the Company's failure
to insist at any time upon strict compliance with
this Agreement or any of its terms nor any continued
course of such conduct on their part shall constitute
or be considered a waiver by Shemano or the Company
of any of their respective rights or privileges under
this Agreement.
O. SEVERABILITY. If any provision herein is or should
become inconsistent with any present or future law,
rule or regulation of any sovereign government or
regulatory body having jurisdiction over the subject
matter of this Agreement, such provision shall be
deemed to be rescinded or modified in accordance with
such law, rule or regulation. In all other respects,
this Agreement shall continue to remain in full force
and effect.
P. COUNTERPARTS. This Agreement may be executed in one
or more counterparts, each of which shall be deemed
an original, and will become effective and binding
upon the parties at such times as all of the
signatories hereto have signed a counterpart of this
Agreement. All counterparts so executed shall
constitute one Agreement binding on all of th parties
hereto, notwithstanding that all of the parties are
not signatory to the same counterpart. Each of the
parties hereto shall sign a sufficient number of
counterparts so that each party will receive a fully
executed original of this Agreement.
Q. ENTIRE AGREEMENT. This Agreement constitutes the
entire agreement between the Company and Shemano. No
other agreements, covenants, representations or
warranties, express or implied, oral or written, have
been made by any party hereto any other party
concerning the subject matter hereof. All prior and
contemporaneous conversations, negotiations, possible
and alleged agreements, representations, covenants
and warranties concerning the subject matter hereof
are merged herein.
This is an integrated Agreement.
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R. ARBITRATION. The parties agree that this Agreement
and all controversies, which may arise between
Shemano and the Company hereunder, will be determined
by arbitration. The parties understand that:
(a) Arbitration is Final and binding on the
parties.
(b) The parties are waiving their right to seek
remedies in court, including the right to a
jury trial.
(c) Pre-arbitration discovery is generally more
limited than and different from court
proceedings.
(d) The arbitrator's award is not required to
include factual findings or legal reasoning
and any party's right to appeal or to seek
modifications or rulings by the arbitrators
is strictly limited.
(e) The panel of arbitrators will typically
include a minority of arbitrators who were
or are affiliated with the securities
industry.
The parties agree that any arbitration under this Agreement will be
held before JAMS/ENDISPUTE in San Francisco, California.
The award of the arbitrators, or of the majority of them, will be
final, and judgments upon the award may be entered in any court, state or
federal, having jurisdiction. The parties hereby submit themselves and their
personal representatives to the jurisdiction of any state or federal court for
the purpose of such arbitration and entering such judgment.
Any forbearance to enforce an agreement to arbitrate will not
constitute a waiver of any rights under this Agreement except to the extent
stated herein.
THIS AGREEMENT IS GOVERNED BY A PRE-DISPUTE
ARBITRATION CLAUSE CONTAINED AT PARAGRAPH 16 OF
THIS AGREEMENT
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THE SHEMANO GROUP, INC.
By:
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Title:
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Date:
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METROPOLITAN HEALTH NETWORKS, INC.
By:
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Title:
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Date:
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