EXHIBIT 10(vii)
INDEPENDENT CONTRACTOR AGREEMENT
This Independent Contractor Agreement (the "Agreement") is entered into
effective May 22, 2002 by and between Motel 6 Barstow, LLC, a limited liability
company (the "Company"), and Xxxxxx X. Xxxxxx (the "Independent Contractor").
WHEREAS the Company desires to continue to employ the Independent
Contractor under terms and conditions which are set forth herein below,
NOW, THEREFORE, in consideration of the foregoing recital and the
respective covenants and agreements of the parties contained in this document,
the Company and the Independent Contractor agree as follows:
1. ENGAGEMENT AND DUTIES. The Independent Contractor will serve as
project coordinator for the Company. The duties and responsibilities of the
Independent Contractor shall be to provide project coordination services for the
development of the Barstow Motel 6 project located in Barstow, California for
the development and construction of a 80 unit motel complex.
2. ENGAGEMENT PERIOD.
1. TERM. Independent Contractor's period of engagement shall be
until such time as the development of the project is completed
and the services of the project coordinator are no longer
required.
2. INVOLUNTARY TERMINATION WITH CAUSE. The Company may terminate
the Independent Contractor's engagement for Cause by providing
the Independent Contractor notice in writing. For all purposes
under this Agreement, "Cause" shall mean (i) willful failure
by the Independent Contractor to perform his duties hereunder,
other than a failure resulting from the Independent
Contractor's complete or partial incapacity due to physical or
mental illness or impairment, (ii) gross negligence by the
Independent Contractor in performing his duties hereunder,
other than negligence resulting from the Independent
Contractor's complete or partial incapacity due to physical or
mental illness or impairment, (iii) a willful act by the
Independent Contractor which constitutes gross misconduct and
which is injurious to the Company, (iv) a willful violation of
a federal or state law or regulation applicable to the
business of the Company. No act or failure to act by the
Independent Contractor shall be considered "willful" unless
committed without good faith and without a reasonable belief
that the act or omission was in the Company's best interest.
The determination of Cause hereunder shall be made by a
majority of the Company's disinterested Board of Directors. No
Severance Pay as defined in paragraph 11(a)(i) will be paid to
the Independent Contractor under this Agreement in the event
of a termination for Cause. Independent Contractor's rights
under any applicable benefit plans of the Company shall be
determined under the provisions of those plans.
3. DEATH. The Independent Contractor's employment will terminate
in the event of his death.
4. RESIGNATION WITHOUT CAUSE. The Independent Contractor may
terminate his engagement by providing the Company at least
thirty (30) days advance written notice; provided that in such
event, the Independent Contractor will cease performing any
duties and responsibilities immediately or at any time during
such thirty (30) day period, if so requested by the Company
and shall forfeit all benefits to which he is entitled under
the terms of this Agreement.
3. PLACE OF EMPLOYMENT. The Independent Contractor's services shall be
performed at the Company's principal offices in Laguna Beach, California at the
offices of the Independent Contractor.
4. FEE. For all services to be rendered by the Independent Contractor
pursuant to this Agreement, the parties agree that the Independent Contractor
shall receive the following:
a. $10,000 upon the execution hereof;
b. a payment of $5,000 on July 1, 2002;
c. a payment of $5,000 on August 1, 2002;
d. a payment of $5,000 on September 1, 2002;
e. a payment of $5,000 on October 1, 2002;
f. upon completion of the project, an amount in Series J preferred stock of
Senior Care Industries, Inc. with a value set at 45% of the completed appraised
value of the project less all encumbrances as of the completion date.
g. Additionally, the Company will, upon completion of the project enter into a
management agreement with the Independent Contractor which shall provide that he
shall receive as compensation thereunder a management fee for the operation of
the project of an amount equal to 45% of the net proceeds of the business
operations from the project.
5. OBLIGATIONS OF INDEPENDENT CONTRACTOR. The Independent Contractor as
a condition of employment agrees to do and to maintain the following:
a. To supervise the engagement, employment and work being done for a feasibility
study, appraisal, work being done by architectural, drafting, design,
engineering, both structural and civil, plan check, permiting to provide such
building permits as may be required from governmental authority, a feasibility
study, appraisal necessary to obtain a construction loan, environmental impact
study, if required, such other studies as may be required by local governmental
authority such as, but not limited to, traffic studies, noise pollution, soil
studies, environmental site assessment studies and the engagement of a general
contractor and subcontractors as may be necessary and appropriate to a speedy
conclusion of the project; and
b. To follow up and process any necessary changes and or required plans that may
be requested to speedily and satisfactorily complete the project and to continue
to provide such services until such time as the project has been completed.
Additionally, the Independent Contractor shall be reimbursed for all expenses
made by him on behalf of the Company, said reimbursement to be made no later
than 7 days after the presentation of an invoice for the said expenses, which
said invoice shall contain copies of all invoices for actual expenses incurred
from third parties.
6. PROPRIETARY INFORMATION. The Independent Contractor shall not, without
the prior written consent of the Company, disclose or use for any purpose
(except in the course of his employment under this Agreement and in furtherance
of the business of the Company) any confidential information or proprietary data
of the Company. As an express condition of the Independent Contractor's
employment with the Company, the Independent Contractor agrees to execute
confidentiality agreements as requested by the Company, including but not
limited to, the Company's standard form of employee proprietary information
agreement, a form of which is attached hereto as Exhibit A and incorporated
herein by this reference.
7. ABSENCE OF CONFLICT. The Independent Contractor represents and warrants
that his engagement by the Company as described herein shall not conflict with
and will not be constrained by any prior employment or consulting agreement or
relationship.
8. ARBITRATION. Except as provided in paragraph 13(b)(1) any dispute or
controversy of any kind arising under or in connection with this Agreement shall
be settled exclusively by binding arbitration in Orange County, California, in
accordance with the rules of the American Arbitration Association then in effect
by an arbitrator selected by both parties within ten (10) days after either
party has notified the other in writing that it desires a dispute between them
to be settled by arbitration. In the event the parties cannot agree on such
arbitrator within such ten (10) day period, each party shall select an
arbitrator and inform the other party in writing of such arbitrator's name and
address within five (5) days after the end of such ten (10) day period and the
two arbitrators so selected shall select a third arbitrator within fifteen (15)
days thereafter; provided, however, that in the event of a failure by either
party to select an arbitrator and notify the other party of such selection
within the time period provided above, the arbitrator selected by the other
party shall be the sole arbitrator of the dispute. Each party shall pay his or
its own attorneys fee and expenses associated with such arbitration, including
the expense of any arbitrator selected by such party and the Company will pay
the expenses of the jointly selected arbitrator. The decision of the arbitrator
or a majority of the panel of arbitrators shall be binding upon the parties and
judgment in accordance with that decision may be entered in any court having
jurisdiction there over.
Punitive damages shall not be awarded.
BY AGREEING TO SUBMIT A DISPUTE OR CONTROVERSY TO ARBITRATION, THE PARTIES
UNDERSTAND THAT THEY WILL NOT ENJOY THE BENEFITS OF A JURY TRIAL. ACCORDINGLY,
THE PARTIES HERETO EXPRESSLY AGREE TO WAIVE THE RIGHT TO A JURY TRIAL.
9. APPLICABLE LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Nevada as applied to agreements between
Nevada residents entered and to be performed entirely within Nevada.
10. CERTAIN COVENANTS OF THE Independent Contractor.
(a) COVENANTS AGAINST COMPETITION. The Independent Contractor acknowledges
that (i) the principal business of the Company and its affiliates involves the
operation of free-standing assisted living residences, primarily located in
small-to-middle market rural and suburban communities, the provision of personal
care and support services to meet the needs of its residents, and other related
businesses which the Company and its affiliates currently operate and which the
Company and its affiliates may become involved with during the Independent
Contractor's employment under this Agreement (collectively, the "Company
Business"); (ii) the Company Business is national in scope; (iii) the
Independent Contractor's work for the Company will bring him into close contact
with many confidential affairs not readily available to the public; and (iv) the
Company would not enter into this Agreement but for the agreements and covenants
of the Independent Contractor contained herein. In order to induce the Company
to enter into this Employment Agreement, the Independent Contractor covenants
and agrees that:
(1) NON-COMPETE. During the time Independent Contractor is engaged under
this Agreement and for a period of six (6) months following the termination
(whether for cause of otherwise) of the Independent Contractor's employment with
the Company or any of its affiliates (the "Restricted Period"), the Independent
Contractor shall not, in the United States of America or in any foreign country,
directly or indirectly, (i) engage in the Company Business for his own account;
(ii) enter the employ of, or render any services to, any persons engaged in such
activities; or (iii) become interested in any person engaged in the Company
Business, directly or indirectly, as an individual, partner, shareholder,
officer, director, principal, agent, employee, trustee, consultant or in any
other relationship or capacity; provided, however, that the Independent
Contractor may own, directly or indirectly, solely as an investment, securities
of any person which are traded on any national securities exchange or NASDAQ if
the Independent Contractor (a) is not a controlling person of, or a member of a
group which controls such person or (b) does not, directly or indirectly, own 1%
or more of any class of securities of such person.
(2) CONFIDENTIAL INFORMATION. During and after the Restricted Period, the
Independent Contractor shall keep secret and retain in strictest confidence, and
shall not use for the benefit of himself or others except in connection with the
business and affairs of the Company, all confidential matters of the Company and
its affiliates. Such confidential matters include, without limitation, trade
secrets, customer lists, subscription lists, details of consultant contracts,
pricing policies, operational methods, marketing plans or strategies, product
development techniques or plans, business acquisition plans, new personnel
acquisition plans, designs and design projects, inventions and research projects
of the Company and its affiliates, learned by the Independent Contractor
heretofore or hereafter that are sufficiently secret to have the possibility,
whether or not realized, of deriving economic value from not being generally
known to other persons who can obtain economic value from their disclosure or
use, and the Independent Contractor shall not disclose them to anyone outside of
the Company and its affiliates, either during or after employment, by the
Company or any of its affiliates, except as required in the course of performing
duties hereunder or with the Company's express written consent. The Independent
Contractor's obligations pursuant to this Employment Agreement shall not extend
to matters which are within the public domain or hereafter enter the public
domain through no fault or action or failure to act, whether directly or
indirectly, on the part of the Independent Contractor.
(3) PROPERTY OF THE COMPANY. All memoranda, notes, lists, records and other
documents (and all copies thereof) made or compiled by the Independent
Contractor or made available to the Independent Contractor concerning the
business of the Company or any of its affiliates shall be the Company's property
and shall be delivered to the Company promptly upon the termination of the
Independent Contractor's engagement with the Company or any of its affiliates or
at any other time on request.
(4) EMPLOYEES OF THE COMPANY. During the Restricted Period, the Independent
Contractor shall not, directly or indirectly, hire, solicit or encourage to
leave the employment of the Company or any of its affiliates, any employee of
the Company or its affiliates or hire any such employee who has left the
employment of the Company or any of its affiliates within six (6) months of the
termination of such employee's employment with the Company or any of its
affiliates.
(5) CONSULTANTS AND INDEPENDENT CONTRACTORS OF THE COMPANY. During the
Restricted Period, the Independent Contractor shall not, directly or indirectly,
hire, solicit or encourage to cease to work with the Company or any of its
affiliates, any consultant, sales representative or other person then under
contract with the Company or any of its affiliates.
(b) RIGHTS AND REMEDIES UPON BREACH. If the Independent Contractor
breaches, or threatens to commit a breach of, any of the provisions of Section
13(a) (the "Restrictive Covenants"), the Company shall have the following rights
and remedies, each of which rights and remedies shall be independent of the
other and severally enforceable, and all of which rights and remedies shall be
in addition to, and not in lieu of, any other rights and remedies available to
the Company under law or in equity.
(1) SPECIFIC PERFORMANCE. The right and remedy to have the Restrictive
Covenants specifically enforced by any court having equity jurisdiction, it
being acknowledged and agreed that any such breach or threatened breach will
cause irreparable injury to the Company and its affiliates and that money
damages will not provide an adequate remedy to the Company. The Parties further
agree that the Company's claim for specific performance shall not be a claim
which is covered by the parties' agreement to arbitrate as set forth in
paragraph 12.
(2) ACCOUNTING. The right and remedy to require the Independent Contractor
to account for and pay over to the Company all compensation, profits, monies,
accruals, increments or other benefits (collectively, "Benefits") derived or
received by the Independent Contractor as a result of any transactions
constituting a breach of any of the Restrictive Covenants, and the Independent
Contractor shall account for and pay over such Benefits to the Company.
(c) SEVERABILITY OF COVENANTS. If any court determines that any of the
Restrictive Covenants, or any parts thereof, are invalid or unenforceable, the
remainder of the Restrictive Covenants shall not thereby be affected and shall
be given full effect, without regard to the invalid portions.
(d) "BLUE-PENCILING". If any court construes any of the Restrictive
Covenants, or any part thereof, to be unenforceable because of the duration of
such provision or the area covered thereby, such court shall have the power to
reduce the duration or area of such provision and, in its reduced form, such
provision shall then be enforceable and shall be enforced.
(e) ENFORCEABILITY IN JURISDICTIONS. The parties intend to and hereby
confer jurisdiction to enforce the Restrictive Covenants upon the courts of any
jurisdiction within the geographical scope of such Restrictive Covenants. If the
courts of any one or more of such jurisdictions hold the Restrictive Covenants
wholly unenforceable by reason of the breadth of such scope or otherwise, it is
the intention of the parties that such determination not bar or in any way
affect the Company's right to the relief provided above in the courts of any
other jurisdiction within the geographical scope of such Restrictive Covenants,
as to breaches of such Restrictive Covenants in such other respective
jurisdictions, such Restrictive Covenants as they relate to each jurisdiction
being, for this purpose, severable into diverse and independent covenants.
11. SUCCESSORS. The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. Failure of the Company to obtain such assumption agreement
prior to the effectiveness of any such succession shall entitle the Independent
Contractor to the Severance Pay described in paragraph 11(a)(i), subject to the
terms and conditions therein.
12. ASSIGNMENT. This Agreement and all rights under this Agreement shall be
binding upon and inure to the benefit of and be enforceable by the parties
hereto and their respective personal or legal representatives, executors,
administrators, heirs, distributees, devisees, legatees, successors and assigns.
This Agreement is personal in nature, and, except as provided in paragraph 18
hereof, neither of the parties to this Agreement shall, without the written
consent of the other, assign or transfer this Agreement or any right or
obligation under this Agreement to any other person or entity. If the
Independent Contractor should die while any amounts are still payable to the
Independent Contractor hereunder, all such amounts, unless otherwise provided
herein, shall be paid in accordance with the terms of this Agreement to the
Independent Contractor's devisee, legatee, or other designee or, if there be no
such designee, to the Independent Contractor's estate.
13. NOTICES. For purposes of this Agreement, notices and other
communications provided for in this Agreement shall be in writing and shall be
delivered personally or sent by United States certified mail, return receipt
requested, postage prepaid, addressed as follows:
If to the Independent
Contractor: Xxxxxx X. Xxxxxx
X.X. Xxx 0000 Xxxxxxx Xxxxx, XX 00000
If to the Company: Motel 6 Barstow, LLC
000 Xxxxxxxx, 0xx Xxxxx
Xxxxxx Xxxxx, XX 00000
or to such other address or the attention of such other person as the recipient
party has previously furnished to the other party in writing in accordance with
this paragraph. Such notices or other communications shall be effective upon
delivery or, if earlier, three (3) days after they have been mailed as provided
above.
14. WAIVER. Failure or delay on the part of either party hereto to enforce
any right, power or privilege hereunder shall not be deemed to constitute a
waiver thereof. Additionally, a waiver by either party of a breach of any
promise hereof by the other party shall not operate as or be construed to
constitute a waiver of any subsequent breach by such other party.
15. SEVERABILITY. Whenever possible, each provision of this Agreement will
be interpreted in such manner as to be effective, valid and enforceable under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
16. RIGHT TO ADVICE OF COUNSEL. The Independent Contractor acknowledges
that he has consulted with counsel and is fully aware of his rights and
obligations under this Agreement.
17. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, none of which need contain the signature of more than one party
hereto, and each of which shall be deemed to be an original, and all of which
together shall constitute a single agreement,
18. FACSIMILE TRANSMISSION AND SIGNATURES. Facsimile transmission of any
signed original document, and retransmission of any signed facsimile
transmission, shall be the same as delivery of an original document. At the
request of either party, the parties will confirm facsimile transmitted
signatures by signing an original documents.
19. INTEGRATION. This Agreement represents the final and entire agreement
and understanding between the parties as to the subject matter hereof and
supersedes all prior or contemporaneous agreements whether written or oral. No
waiver, alteration or modification of any of the provisions of this Agreement
shall be binding unless in writing and signed by duly authorized representatives
of the parties hereto.
IN WITNESS WHEREOF, each of the parties has executed this Agreement, in
the case of the Company by its duly authorized officer, on the day set opposite
its name below.
Motel 6 Barstow, LLC
By: /s/ Xxxxx X. Xxxxx
Xxxxx X. Xxxxx
Managing Member
Independent Contractor
/s/ Xxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx
