ads Exhibit 10.1
Services Agreement by and between the Issuer and BJH Management LLC
dated July 1, 2006
SERVICES AGREEMENT
SERVICES AGREEMENT (this "Agreement") dated as of July 1, 2006, by and
between EMERGENT GROUP INC., a Nevada corporation having an office at 000 Xxxxx
Xxxxxxx Xxxxxx, Xxxxxxxx, Xxxxxxxxxx 00000 ("Company"), and BJH MANAGEMENT, LLC,
having an office at 000 Xxxxxxxx Xxxxxx, Xxxxx 000, Xxx Xxxxxxxx, XX 00000
("BJH").
W I T N E S S E T H:
WHEREAS, Company desires to engage the services of BJH and in turn for BJH
to provide to the Company the services of BJH's employee, namely, Xxxxx X. Xxxxx
("Xxxxx") to the Company as its Chief Executive Officer and for Xxxxx to fulfill
BJH's obligations under this Agreement; and
WHEREAS, both parties desire to clarify and specify the rights and
obligations of each party hereunder.
NOW, THEREFORE, in consideration of the agreements and covenants herein set
forth, the parties hereby agree as follows:
1. Services
BJH represents that Xxxxx is an employee of BJH and that Xxxxx'x principal
occupation is his services that he provides to BJH. BJH agrees to provide Xxxxx
to Emergent to serve as its Chief Executive Officer of Company, and BJH agrees
to provide Xxxxx'x services to the Company as its Chief Executive Officer, for
the Term (as hereinafter defined), all subject to and on the terms and
conditions herein set forth.
2. Duties and Responsibilities of Xxxxx
(a) Xxxxx will serve as the Chief Executive Officer of Company, subject to
the other provisions of this Section 2. As Chief Executive Officer of the
Company, Xxxxx will perform the duties he deems necessary, with the
understanding that he will devote only such time, as he deems necessary to
perform such duties. Although Xxxxx shall be required to travel from time to
time, Xxxxx'x primary office shall be based in the New York City metropolitan
area. Xxxxx shall not be required to relocate from the New York, New York
metropolitan area without Xxxxx'x prior written consent, which consent may be
withheld by Xxxxx in his absolute discretion. Xxxxx shall also perform duties as
he deems appropriate for the Company's subsidiaries.
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(b) Subject to Section 14, Xxxxx shall be elected to the Board of Directors
of the Company (the "Board") initially as Chairman, and during the Term shall be
nominated for re-election to the Board.
(c) During the term of this Agreement, Xxxxx will exercise such authority,
perform such executive duties and functions and discharge such responsibilities
as he deems appropriate as are customarily vested in the chief executive officer
of a public company, including, ultimate authority with respect to among other
matters, purchasing, pricing, sales and the hiring, compensating and discharging
of employees, financing arrangements, all subject to the overall authority of
the Board of Directors of the Company consistent with the By-Laws of the
Company. As such, Xxxxx shall be primarily responsible for the direction and
management of the current and future affairs and business of the Company. Xxxxx
shall use his best efforts to maintain and enhance the business and reputation
of Company and shall perform such other duties commensurate with his position as
may, from time to time, be designated to Xxxxx by the Board.
3. Non-Exclusivity of Service
The Company agrees that since Xxxxx'x principal occupation is his services
to BJH and, since BJH has other business interests, that Xxxxx shall not be
required to devote his full business time, effort and attention to the business
and efforts of the Company, but rather shall only devote such time as Xxxxx, in
good faith, deems to be reasonably necessary for the performance of Xxxxx'x
duties hereunder on behalf of BJH.
4. Fee; Bonus
(a) In consideration for BJH providing Xxxxx'x services to be performed
under this Agreement and as compensation therefor, Company shall pay to BJH,
commencing as of the date set forth above, in addition to all other payments or
benefits provided to Xxxxx provided for in this Agreement, a fee at the rate of
One Hundred Eighty-Two Thousand ($182,000) Dollars per annum, (the "BJH Base
Fee") which BJH Base Fee may be increased in the sole discretion of the Board.
All payments of Xxxxx Base Fee shall be payable in monthly installments payable
on the first day of each month in advance.
(b) In addition to the BJH Base Fee, in the event that the Company attains
the milestones ("Milestones") that are established from time to time in
accordance with Schedule I annexed hereto, BJH shall be entitled to an annual
bonus fee (the "Milestone Bonus") as indicated on Schedule I. The Milestone
Bonus, if any, shall be paid within thirty (30) days after the end of each
fiscal year end of the Company. Should this Agreement be terminated prior to the
end of any fiscal year for any reason other than that provided in Section 10(a),
a prorata portion of the Milestone Bonus shall be paid within 30 days of such
termination.
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5. Benefits and Indemnification
BJH shall be entitled to the following during and in respect of the term of
this Agreement:
(a) Company shall provide Xxxxx with hospitalization, medical and dental
insurance coverage as is customary for other Most Senior Officers of the Company
or reimburse BJH for such benefits.
(b) Xxxxx shall be entitled to three weeks vacation paid to BJH to be taken
at times mutually and reasonably agreed upon by BJH and Company in addition to
all other holidays established as part of BJH's standard practices.
(c) BJH and Xxxxx shall each be entitled to reimbursement for all of
Xxxxx'x and BJH's reasonable travel, reasonable entertainment and other
reasonable office rent and other expenses incurred in connection with Company's
business, provided that such expenses are adequately documented and vouchered in
accordance with Company's policies.
(d) The Company shall provide to Xxxxx and BJH to the full extent provided
for under the laws of the Company's state of incorporation and the Company's
Certificate of Incorporation and Bylaws, indemnification for any claim or
lawsuit which may be asserted against Xxxxx or BJH when acting in such capacity
for the Company and/or any subsidiary or affiliated business. The Company shall
use reasonable best efforts to include Xxxxx and BJH as an insured under all
applicable directors' and officers' liability insurance policies maintained by
the Company, and any other subsidiary or affiliated business.
6. "Intentionally Left Blank"
7. Term of Services
The term of this Agreement shall continue until June 30, 2007, unless
terminated prior thereto in accordance with Section 10 hereof. Unless the
Company provides notice of its intent not to renew this Agreement 90 days prior
to each anniversary date, the Agreement shall automatically renew for an
additional one year period. The Company must renew this Agreement if Xxxxx has
not been released by the applicable institutional lender(s) from all personal
guarantees of Company loans or Company has not retired all outstanding
indebtedness owed to such lender(s).
8. Confidentiality
(a) Non-Disclosure. BJH and Xxxxx acknowledge that during the Term of this
Agreement they may have access to certain Confidential Information (as defined
below) of the Company and its affiliates. BJH and Xxxxx acknowledge and agree
that any and all Confidential Information learned or obtained by the them while
engaged pursuant to this Agreement that is not already in the public domain or
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is not disclosed by a third party shall be and is the property of the Company,
its subsidiaries and affiliates. BJH and Xxxxx will not use Confidential
Information or property of the Company or its respective subsidiaries and
affiliates other than in connection with their obligation hereunder and will not
use such Confidential Information or property for their own benefit or the
benefit of any person or entity with which they may be associated.
(b) Return of Confidential Information. Following the termination of this
Agreement, as soon as possible after Company's written request, BJH and Xxxxx
will return to Company all written Confidential Information which has been
provided to them.
(c) Definition of Confidential Information. For the purposes of this
Agreement, "Confidential Information" shall mean all confidential and
proprietary information of the Company and its affiliates, including, without
limitation, the Company's business, financial and technical information, the
Company's marketing strategies, pricing policies or characteristics, customers
and customer information, product or product specifications, designs, customer
lists, business or business prospects, plans, proposals, codes, marketing
studies, research, reports, forecasts, investigations, technical data, patents,
trade secrets, know-how and communications or other information of similar
character, whether in written, oral, graphic, electromagnetic, software code, or
any other form, including, but not limited to, data, models, samples,
prototypes, graphs, specifications, designs, plans, mechanical and electronic
drawings, protocols, techniques, methods, and apparatus.
9. Non-Competition; Non-Solicitation
(a) Xxxxx and BJH hereby agree and covenant that during the Term hereof and
for a period of six (6) months thereafter that Xxxxx 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 as its primary business
principally engaged in the current business of the Company during the Term, it
being agreed that the current business of the Company is the leasing of surgical
equipment to healthcare providers on a per procedure basis; provided, however,
that ownership of not more than 20% of the outstanding securities of any class
of any entity shall not be considered a breach of this Section 9.
(b) Xxxxx and BJH agree and covenant 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 Xxxxx or BJH solicited business or
for which a proposal for submission was prepared during the period.
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(c) Xxxxx and BJH agree and covenant 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 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; provided,
however that the provisions of this Section 9 shall not apply to Xxxxx Xxxxxx or
Xxxx Xxxx.
(d) This Section 9 shall not apply in the event of a sale or change of
control of the Company.
10. Termination
(a) Termination by the Company with Cause. Notwithstanding the terms of
this Agreement, Company may terminate this Agreement for cause ("Cause") in the
event (i) of Xxxxx'x commission of an act involving fraud, embezzlement, or
theft against the property or personnel of Company, (ii) Xxxxx shall be
convicted of, or plead nolo contendere to a felony or engages in other criminal
conduct that could reasonably be expected to have a material adverse affect on
the business, assets, properties, prospects, results of operations or financial
condition of Company, or (iii) of the breach by Xxxxx or BJH of the restrictive
covenants set forth in Sections 8 and 9 hereof. In the event this Agreement is
terminated pursuant to this Section 10(a), BJH's Base Fee and any unearned
Milestone Bonus and all benefits under Section 5a) b) and c) hereof shall
terminate immediately upon such discharge, and Company shall have no further
obligations to BJH except for payment and reimbursement for any monies due which
right to payment or reimbursement accrued prior to such termination.
(b) Death or Disability. The Company may terminate this Agreement upon the
disability or death of Xxxxx by giving written notice to BJH. In the case of
Xxxxx'x disability, such termination will become effective immediately upon the
giving of such notice unless otherwise specified by the Company. For purposes of
this Section 10(b), "disability" shall mean that for a period of more than six
consecutive months in any 12-month period Xxxxx is unable to perform the
essential functions of his position because of physical, mental or emotional
incapacity resulting from injury, sickness or disease. Upon any such
termination, the Company shall be relieved of all its obligations under this
Agreement, except for payment of the BJH Base Fee and Milestone Bonus earned and
unpaid through the effective date of termination. Nothing in this provision is
intended to violate state or federal laws.
(c) Termination by BJH. BJH may terminate this Agreement at any time by
giving thirty (30) days' prior written notice to the Company. The Company shall
be relieved of all of its obligations under this Agreement, except for payment
of the BJH Base Fee and Milestone Bonus earned and unpaid through the effective
date of termination and those obligations in paragraph 5d).
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11. Violation of Other Agreements and Authority
(a) Xxxxx and BJH represent and warrant to Company that each is legally
able to enter into this Agreement; that each of Xxxxx and BJH is not prohibited
by the terms of any agreement, understanding or policy from entering into this
Agreement; that the terms hereof will not and do not violate or contravene the
terms of any agreement, understanding or policy to which each of Xxxxx and BJH
is or may be a party, or by which Xxxxx may be bound; that Xxxxx is under no
physical or mental disability that would materially interfere with the
performance of Xxxxx'x duties under this Agreement. BJH agrees that, as it is a
material inducement to Company that Xxxxx and BJH make the foregoing
representations and warranties and that they be true in all material respects.
(b) Authority Relative to this Agreement. The Company has the requisite
corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated by this Agreement. The Board of
Directors of the Company has duly authorized the execution and delivery of this
Agreement by the Company and the consummation by the Company of the transactions
contemplated on its part by this Agreement, and no other corporate proceedings
on the part of the Company are necessary to authorize this Agreement or for the
Company to consummate the transactions contemplated by it. The Company has duly
validly executed and delivered this Agreement and it is a valid and binding
Agreement of the Company, enforceable against the Company in accordance with its
terms, subject to bankruptcy or insolvency laws affecting creditors' rights
generally and to general principles of equity.
12. Specific Performance; Damages
In the event of a breach of the provisions of Sections 8 and 9 hereof, BJH
agrees that the injury which could be suffered by Company would be of a
character which could not be fully compensated for solely by a recovery of
monetary damages. Accordingly, BJH agrees that in the event of a breach of
Sections 8 and 9 hereof, in addition to and not in lieu of any damages sustained
by Company and any other remedies which Company may pursue hereunder or under
any applicable law, Company shall have the right to seek equitable relief,
including issuance of a temporary or permanent injunction, by any court of
competent jurisdiction against the commission or continuance of any such breach
or threatened breach.
13. [Left blank intentionally.]
14. [Left blank intentionally.]
15. 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 set forth above or such other
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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 Company, with a copy to:
Xxxxx & Xxxxx, PLLC
0000 Xxx Xxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attn: Xxxxxx Xxxxx, Esq.
In the case of Xxxxx or BJH, with a copy to:
Xxxxx Xxxxxx, Esq.
Xxxxx Raysman Xxxxxxxxx Xxxxxx & Xxxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
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 third 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.
16. Waivers
No waiver by any party of any default with respect to any provision,
condition or requirement hereof shall be deemed to be a waiver of any other
provision, condition or requirement hereof; nor shall any delay or omission of
any party to exercise any right hereunder in any manner impair the exercise of
any such right accruing to it thereafter.
17. Preservation of Intent
Should any provision of this Agreement be determined by a court having
jurisdiction in the premises to be illegal or in conflict with any laws of any
state or jurisdiction or otherwise unenforceable, the parties agree that such
provision shall be modified to the extent legally possible so that the intent of
this Agreement may be legally carried out.
18. Entire Agreement
This Agreement sets forth the entire and only agreement or understanding
between the parties relating to the subject matter hereof and supersedes and
cancels all previous agreements, negotiations, letters of intent,
correspondence, commitments and representations in respect thereof among them,
and no party shall be bound by any conditions, definitions, warranties or
representations with respect to the subject matter of this Agreement except as
provided in this Agreement.
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19. "Intentionally Left Blank"
20. Inurement; Assignment
The rights and obligations of Company under this Agreement shall inure to
the benefit of and shall be binding upon any successor of Company or to the
business of Company, subject to the provisions hereof. Neither this Agreement
nor any rights or obligations of Xxxxx hereunder shall be transferable or
assignable by BJH.
21. Amendment
This Agreement may not be amended in any respect except by an instrument in
writing signed by the parties hereto.
22. Headings
The headings in this Agreement are solely for convenience of reference and
shall be given no effect in the construction or interpretation of this
Agreement.
23. Counterparts
This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original, but all of which when taken together shall
constitute one and the same instrument.
24. Governing Law
This Agreement shall be governed by, construed and enforced in accordance with
the internal laws of the State of New York, without giving reference to
principles of conflict of laws. Each of the parties hereto irrevocably consents
to the venue and exclusive 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
STOCK ISSUANCE 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.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
BJH MANAGEMENT, LLC
By: /s/ Xxxxx X. Xxxxx
-------------------------
Xxxxx X. Xxxxx, President
EMERGENT GROUP INC.
By: /s/ Xxxxx Xxxxxx
-----------------------
Xxxxx Xxxxxx, President
The undersigned agrees to be bound by the provisions of this Services
Agreement to provide his services to the Company on behalf of BJH and he agrees
to be bound by the representations and warranties contained herein for the
benefit of the Company and BJH.
/s/ Xxxxx X. Xxxxx
---------------------
Xxxxx X. Xxxxx
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SCHEDULE I
MILESTONES BONUSES
A) Milestone Bonuses will be based on the following:
Profit before Management Bonuses of at Least Bonus
--------------------------------------------------------------------------------
$1,035,000 $50,000
$1,150,000 $75,000
over $1,150,000 $75,000 plus 6% of
the pretax profit over
$1,150,000
