EXHIBIT 10.5
CONSULTING AGREEMENT
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AGREEMENT made as of this 1st day of December, 1998 by between TopForm Inc
("TopForm") with an address of 000 X Xxxxxx, Xxx Xxxxx, XX. 00000 and Xxxxxx
Xxxxxxxxx (the "Consultant"), with an address at 0000 X. Xxxxxxx Xx., Xxx
Xxxxxxx, XX. 00000.
WITNESSETH
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WHEREAS, Consultant posses certain knowledge and expertise in certain fields
in which the Company is conducting research and development and/or is
otherwise engaged in business (the "Field"), and desired to provide services
to the Company;
WHEREAS, the Company desired to retain the Consultant to provide required
medical advisory services and investment banking advise in the Field;
WHEREAS, the Consultant desires to be retained to render such services upon
the terms and conditions herein set forth; and
WHEREAS, The Company desires the Consultant not to compete with the Company.
NOW, THEREFORE, in consideration of the premises and the mutual covenants and
agreements hereinafter set forth, the partie hereto hereby agree as follows:
1. Prior to the execution of this Agreement, Consultant has entered into
and executed an Unconditional Continuing Guaranty (the "Guaranty") in
favor of DVI Financial Services, Inc. ("DVI"). The Guaranty was
provided pursuant to a Subordination Agreement entered into on February
24, 1998 by and among Consultant, Xxx Xxxxxx, M.D.: Truvision Laser
Center of Albuquerque, Inc. ("Truvision") and DVI Financial Services,
Inc., ("DVI"). Truvision, is obtaining leases, loans, extensions of
credit and other financial services from DVI, and was required to
provide the Guaranty in order to close the refinancing of the
Albuquerque VISX laser facility.
2.(a) Subject all times to the supervision and direction of the officers and
Board of Directors of the Company, the Consultant shall during the term
hereof render medical advisory, investment banking consulting and
technical services to the Company ("the Services"). Such Services shall
relate to the further research and development of the Field, as part of
the business of the Company, as the same shall now or hereafter exist,
or as the Company's Board of Directors or officers may from time to
time reasonable request. The Consultant shall perform his duties as an
independent contractor, and not as an employee, by use of his best
efforts and due diligence.
(b) Consultant may offer ideas or concepts to Company at any time that are
not specifically requested by the Company, however, Consultant shall
first present a broad and general oral outline of the proposed Services
to the Company, for the purpose of minimizing Consultant's efforts in
those instances where the proposed idea or concept may not appear to be
consistent with the Company's research objectives, may appear to
duplicate Company activities planned or in progress; or may appear to
have been previously considered by the Company. It is understood that
the Company shall have the sole and exclusive right to accept or reject
any Service offered, and the sole and exclusive right to accept or
reject any Service offered, and the sole and exclusive right to
determine the extent, if any, to which a Service idea or concept shall
be further studied or developed.
(c) As long as the Guaranty is in effect, the Company shall engage
Consultant or his designee as a nonvoting advisor to the Company's
Board of Directors. The Company shall notify and invite Consultant to
each meeting of the Board. Consultant shall receive all notices and
other correspondence and communications set by the Company to Members
of the Board. Consultant shall be entitled to receive reimbursement for
all reasonable costs incurred in meetings including but not limited,
food, lodging, and transportation. In addition, Consultant shall be
entitled to the same compensation as the Company gives to other
non-employee directors for acting in such capacity.
3. This Agreement is for a term of thirty-six (36) months (the "Term"),
subject to earlier termination as provided in paragraph 6 below. The
foregoing notwithstanding, this Agreement may be extended or renewed by
mutual consent of the parties hereto.
4. In full satisfaction for services to be rendered hereunder pursuant to
paragraph 1, the Consultant hereby accepts, the following compensation:
(a) The consultant will receive an annual salary of $102,000.00 paid
monthly in advance at the rate of $8,500.00 per month (the "Monthly
Fee") for services rendered as a member of the Company's Medical
Advisory Board. The monthly fee will commence upon receipt of the
Company proceeds of the proposal or for July 31, 1999, whichever
comes first. In addition to the Monthly Fee, the Company will
reimburse the Consultant on a monthly basis for all reasonable
travel and out-of-pocket expenses incurred by the Consultant in the
performance of his duties hereunder, and the Consultant shall
account for such expenses to the Company.
(b) In addition to the consideration set forth in Section 2 (a) above,
the Consultant shall be entitled to purchase 400,000 post split
shares (the "Shares") of the Company's Common Stock at par value.
The Shares shall be registered by the Company with the Securities
and Exchange Commission ("SEC") on the next available registration
statement and if not so registered within six months from the date
hereof, shall be included on a Form S-8 Registration Statement or
any other available registration statement to be filed within seven
months from the date hereof.
(c) Consultant shall be paid all past due and then pending consultant
fees owed by Tru Vision, accrued at the rate of $5,000.00 per month,
or an aggregate of $90,000.00 as if this date. The monies shall be
paid to Consultant from the proceeds of the Company's proposed
private placement but in any event no later than July 31, 1999.
(d) The Company hereby represents and warrants it will use its best
efforts to make all laser financing payments to DVI described in
Section 2 above, on a timely basis.
5. All obligations of the Consultant contained herein shall be subject to
the Consultant's reasonable availability for such performance, in view of the
nature of the requested service and the amount of notice received. The
Consultant shall devote such time and effort to the performance of his duties
hereunder as the Consultant shall determine is reasonable necessary for such
performance. The Consultant may look to such others for such factual
information, investment recommendations, economic advice and/or research,
upon which to base his advise to the Company hereunder, as it shall deem
appropriate. The Company shall furnish to the Consultant all information
relevant to the performance by the Consultant of his obligations under this
Agreement, or particular projects as to which the Consultant is acting as
advisor, which will permit the Consultant to know all facts material to the
advice to be rendered, and all material or information reasonable requested
by the Consultant. In the event that the Company fails or refuses to furnish
any such material or information reasonable requested by the Consultant, and
thus prevents or impedes the Consultant's performance hereunder, any
inability of the Consultant to perform shall not be a breach of his
obligations hereunder.
6. If, during the term of agreement, the Consultant voluntarily terminates
his services as Consultant or is terminated by the Company for Cause, as
such term is defined below, then the term of this agreement shall end without
further action by either party if hereto, and all rights and obligations of the
parties hereunder, except those set forth in paragraphs 8 and 9 hereof, shall
terminate as of such date. For the purposed of this Agreement, "Cause" shall
mean either the non-performance of the Consultant's duties set forth herein,
as reasonable determined by the Company, or the conviction of the Consultant
for a felony committed against the Company.
7. Except with respect to business activities competitive to the Company's
Field, nothing contained in the Agreement shall limit or restrict the right
of the Consultant or of any partner employee, agent or representative of the
Consultant, to be a partner, director, officer, employee, agent or
representative of, or to engage in, any other business, whether of a similar
nature or not, nor to limit or restrict the right of the Consultant to render
services of any kind to any other corporation, firm, individual or
association.
8. The Consultant will hold in confidence any confidential information which
the Company provides to the Consultant pursuant to this Agreement unless the
Company gives the Consultant permission in writing to disclose such
confidential information to
a specific third party. Notwithstanding the foregoing, the Consultant shall
not be required to maintain confidentiality with respect to information (i)
which is or becomes part of the public domain; (ii) of which it had
independent knowledge prior to disclosure; (iii) which comes into the
possession of the Consultant in the normal routine course of his own business
from and through independent non-confidential sources; or (iv) which is
required to be disclosed by the Consultant by governmental requirements. If
the Consultant is requested or required (by oral questions, interrogatories,
request for information or document subpoenas, civil investigative demands,
or similar process) to disclose any confidential information supplied to him
by the Company, or the existence of other negotiations in the course of his
dealings with the Company or its representatives, the Consultant shall, unless
prohibited by law, promptly notify the Company of such request(s) so that the
Company may seek an appropriate protective order. The Paragraph shall survive
the termination of this Agreement.
9. The Company and the Consultant agree to indemnify and hold each other
harmless including their respective partners, employees, agents,
representatives and controlling persons (and the officers, directors,
employees, agents, representatives and controlling persons of each of them)
form and against any and all losses, claims, damages, liabilities, costs and
expenses (and all actions, suits, proceedings or claims in respect thereof)
and any legal or other expenses in giving testimony or giving documents in
response to a subpoena or otherwise (including, without limitation, the cost
of investigating, preparing or defending any such action, suit, proceeding or
claim, whether or not in connection with any action, suit, proceeding or
claim in which either the Company or the Consultant is a party), as and when
incurred, directly or indirectly, caused by, relating to, based upon or
arriving out of their respective obligations under the Agreement. This
paragraph shall survive the termination of this agreement.
10. This agreement may not be transferred, assigned or delegated by any of
the parties hereto without the prior written consent of the other party
hereto.
11. The failure or neglect of the parties hereto to insist, in any one or
more instances, upon the strict performance of any of the terms or
conditions of this Agreement, or their waiver of strict performance of any
of the terms or conditions of this Agreement, shall not be construed as a
waiver or relinquishment in the future of such terms or condition, but the
same shall continue in full force and effect.
12. Any notices hereunder shall be sent to the Company and to the Consultant
at their respective addresses set forth above. Any notice shall be given by
registered or certified mail, postage prepaid, and shall be deemed to have
been given when deposited in the Bermudian or United States mail. As the case
may be. Either party may designate any other address to which notice shall be
given, by giving written notice to the other of such change of address in the
manner herein provided.
13. This Agreement has been made in the State of California and shall be
construed and governed in accordance with the laws thereof without giving
effect to principles governing conflicts of law.
14. This Agreement contains the entire agreement between the parties, may not
be altered or modified, except in writing and signed by the party to be
charged thereby, and supersedes any and all previous agreements between the
parties relating to the subject matter hereof.
15. This Agreement shall be binding upon the parties hereto, the indemnified
parties referred to in Section 9, and their respective heirs, administrators,
successors and permitted assigns.
IN WITNESS WHEREOF, this Agreement has been executed by the parties
hereto as of the date first above written.
/s/ Xxxxxx X. Xxxxxxxxx /s/ Xxxx Xxxxx
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Xxxxxx X. Xxxxxxxxx Xxxx Xxxxx
TOPFORM, Inc.
