INDEPENDENT CONTRACTOR AGREEMENT
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THIS INDEPENDENT CONTRACTOR AGREEMENT ("Agreement") is made and entered into
as of the 1st day of December, 1996, by and between National Medical
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Financial Services Corporation, a Nevada Corporation (hereinafter "Company") and
Bradford Group, Inc., a Nevada Corporation, located at 00000 Xxxxx Xxxxx Xxxxx,
Xxxxxxx, Xxxxx Xxxxxxxx, 00000, (hereinafter "Contractor").
WITNESSETH:
ARTICLE I. DEFINITIONS
Capitalized terms used in the Agreement shall have their defined meaning
throughout the Agreement. The following terms shall have the meanings set forth
below, unless the context clearly requires otherwise.
1.1 Agreement means this Independent Contractor Agreement, as from
time to time amended in accordance herewith.
1.2 Commencement Date means December 1 ,1996.
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1.3 Company means National Medical Financial Services Corporation.
1.4 Confidential Information means information that is proprietary to
the Company or proprietary to others and entrusted to the
Company, whether or not trade secrets, Confidential Information
includes, but is not limited to, information relating to business
plans and to business as conducted or anticipated to be
conducted, and to past or current or anticipated products,
services to procedures. Confidential Information also includes,
without limitation, names, addresses, lists, rates, and
information concerning Company research, development, purchasing,
accounting, marketing, selling and acquisition of billing service
companies and billing services. All information that Contractor
or Company has a reasonable basis to consider confidential is
Confidential Information, whether or not originated by
Contractor, and without regard to the manner in which Contractor
obtains access to this and any other proprietary information.
Notwithstanding the above, the Bradford Group, Inc. may use its
proprietary valuation and due diligence systems to serve other
clients and is not considered Company Confidential Information under
the terms of this Agreement.
1.5 Contractor means The Bradford Group, Inc.
1.6 Territory means U.S.A.
1.7 Target means billing and financial services companies in the
medical and healthcare fields.
ARTICLE II. RETENTION, DUTIES AND TERM
2.1 Retention. Upon the terms and conditions set forth in this
Agreement, the Company hereby retains Contractor and Contractor
accepts such retention as an independent contractor. Except as
expressly provided elsewhere in this Agreement, expiration of its
initial term or as extended, or termination of this Agreement by
either party, or by mutual agreement of the parties, shall also
terminate Contractor's retention by the Company. Contractor
hereby acknowledges that it has the capability to provide the
services required under the terms and conditions of this
Agreement.
2.2 Services and Duties.
(a) During the term of this Agreement, Contractor agrees to
devote its professional and best efforts and attention to
the business and affairs of the Company and, to the extent
necessary to discharge the responsibilities assigned to
Contractor hereunder, to use Contractor's best efforts to
perform faithfully and efficiently such responsibilities, to
abide by the policies and procedures of the Company and
accept no other gainful retention with a competitor of the
Company without the consent of the Company.
(b) During the term of this Agreement, it shall not be a
violation of this Agreement for Contractor to accept
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work for other medical billing service companies not in
competition with Company, and, so long as such activities do not
interfere with the performance of Contractor's responsibilities
as an independent contractor of the Company and do not result in
or from Confidential Information in accordance with this
Agreement.
(c) Contractor shall develop leads, qualify leads, negotiate and
close acquisitions of Targets specifically approved by
Company.
(d) Contractor shall be responsible for managing the acquisition
process of Targets, including but not limited to, due
diligence, overseeing the preparation of legal
documentation, preparation of schedules, and closing.
(e) Contractor shall operate within the written acquisition
guidelines developed by the Company, and provided to
Contractor, with exception or deviation, being pre-approved
by the Company's CEO. Acquisition guidelines may be amended
from time to time by the Company.
(f) Contractor shall represent Company in a highly professional
manner.
(g) Contractor shall, during 1997, acquire $10,000,000 in net
revenues through the acquisition of billing companies and
other related medical financial management businesses and
through the execution of service agreements (including but
not limited to transcription and xxxxxxxx). The 1998
acquisition goal will be set during the first six month
period of 1997. Contractor may, with prior Company
approval, broker Company rejected acquisition candidates to
other noncompetitors of the Company.
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(h) Contractor will keep and maintain appropriate records
related to all services rendered by it under this Agreement
and will meet every two weeks or as required, with the
Company's Chairman. Contractor will maintain and provide
Company a status report of qualified leads, practices under
letter of intent, and schedule of closings.
2.3 Company's duties.
(a) Company shall support Contractor by providing written
acquisition financial guidelines.
(b) Company shall provide the capital necessary to complete
qualified acquisitions.
(c) Contractor may use the Company name and logo while representing
the Company.
(d) The Company shall be responsible for providing appropriate
legal services necessary to support Contractor in closing
acquisitions.
(e) The Company shall provide direct supervision of the
Contractor through its Chairman.
2.4 Certain Proprietary Information. If Contractor possesses any
proprietary information of another person or entity as a result
of prior retention or relationship, Company shall not interfere
with legal obligations that Contractor has with that person or
entity with respect to such proprietary information.
2.5 Term. The term of this Agreement shall begin on the Commencement
Date and shall end three (3) years from the Commencement Date
year, unless sooner terminated as set forth in Article IV hereof.
2.6 Ownership and Return of Confidential Information. Contractor
agrees that all Company Confidential Information in Contractor's
possession, including without
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limitation, all documents, financial reports, records, leads, manuals,
memoranda, computer print-outs, lists, and all other property relating
in any way to the business of the Company is the exclusive property of
the Company, even if Contractor authored, created or assisted in
authoring or creating, such property. Notwithstanding the above, the
Bradford Group, Inc. may use its proprietary valuation and due
diligence systems to serve other clients and is not considered Company
Confidential Information under the terms of this Agreement.
Contractor shall return to the Company all such Confidential
Information immediately upon expiration or termination of
retention or at such earlier time as the Company may request.
ARTICLE III. COMPENSATION, BENEFITS AND EXPENSES
3.1 Compensation. During the term of Contractor's retention by
Company, Contractor shall be entitled to compensation in
consideration of its services hereunder, based upon the following
commission formula:
4% times the annual revenue as used by Company and
Contractor in the acquisition of the acquired business.
Said commission is calculated as part of the consideration
for the acquired business. Such Commission is earned by and
shall be distributed to the Contractor at the closing of the
acquisition.
Company will advance to Contractor an amount of $11,000 per
month payable on the first of each month. This advance will
be reconciled against all commissions as they are earned.
3.2 Health Insurance, Professional Liability, Unemployment, and
Workers or Workmen's Compensation Insurance. The Company shall
not provide health insurance, professional liability,
unemployment, workers compensation
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insurance for employees of Contractor, and it will be Contractor's
responsibility to provide those coverages, and provide to Company
evidence of same.
3.3 Travel and Other Expenses. Contractor will be responsible to
bear for all travel and other related expenses in performing its
duties under this Agreement.
3.4 Indemnity by Contractor. The Contractor shall hold harmless and
indemnify the Company, its successors and assigns, from and
against any liabilities, costs, damage, expenses and reasonable
attorney's fees imposed against Company resulting from or
attributable to any and all acts and omissions of the Contractor,
under this Agreement, or any prior liabilities, acts or omissions
of the Contractor in the conduct of its business for Company.
The provisions of this Section 3.4 shall survive the expiration
or termination of this Agreement and the Contractor's retention
hereunder.
3.5 Indemnity by Company. The Company shall hold harmless and
indemnify the Contractor, its successors and assigns, from and
against any liabilities, costs, damage, expenses and reasonable
attorney's fees imposed against Contractor resulting from or
attributable to any and all acts and omissions of the Company,
under this Agreement. The provisions of this Section 3.5 shall
survive the expiration or termination of this Agreement and the
Company's retention hereunder.
3.6 Contractor's Employee Deductions. Contractor will pay to the
proper government agencies employer contributions for old-age
benefits and unemployment insurance, as well as all other
federal, state, or municipal mandated withholding. Contractor
will keep accurate records of accounts relative to the above
deductions and payments, and it will make the same, together with
any and all supporting data, copies of returns, and other related
data, available to representatives of Company at times during
usual business hours. It is understood that Contractor will
carry Workers' Compensation and Occupational
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Disease Insurance, upon all its employees engaged in the
performance of services under this Agreement, and it will
otherwise fully comply with all applicable employment laws.
ARTICLE IV. EARLY TERMINATION
Subject to the respective continuing obligations of the parties elsewhere
provided in this Agreement, this Article IV sets forth the terms for early
termination of Contractor's retention under this Agreement.
4.0 Either party may terminate this Agreement "for cause" upon sixty
(60) days prior written notice. "For Cause" shall be defined as
one party failing to remedy any breach of this Agreement, alleged
by the other in writing, within thirty (30) days of such notice
of breach.
4.1 Termination without Cause. Either party may terminate this
Agreement without cause with ninety (90) days prior written
notice.
4.2 Compensation upon Termination. If Contractor's retention under
this Agreement is terminated by the Company for Cause, the
Company shall, upon the Date of Termination, pay any amounts
earned by Contractor in accordance with the provisions of
paragraph 3.1 of this Agreement through the Date of Termination.
If Contractor's retention under this agreement is terminated by
the Company without Cause, the Company shall, upon the Date of
Termination, pay any amounts earned by Contractor in accordance
with the provisions of paragraph 3.1 of this Agreement through
the Date of Termination, plus $11,000 per month for three months.
4.3 Termination by Contractor. In the event any payment owed to
Contractor under Article III is not made when due and such
default is not cured within thirty (30) days after Contractor
gives the Company written notice of such default, the Contractor
may, within ten (10) days thereafter, give written Notice of
termination of this Agreement to the Company.
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ARTICLE V. CONFIDENTIAL INFORMATION
5.1 Prohibitions Against Use. Contractor agrees that, during the
term of its retention by the Company and for a period of two (2)
years following the expiration or termination of Contractor's
retention under this Agreement, Contractor will not use or
disclose, other than in connection with Contractor's retention
with the Company, any Company Confidential Information to any
person not employed by the Company or not authorized by the
Company to receive such Confidential Information-nation, without
the prior written consent of the company. Contractor will use
reasonable and prudent cm to safeguard and protect and prevent
the unauthorized use and disclosure of Company Confidential
Information. Contractor agrees to require each and every sales
person employed by Contractor for the Company to execute a
confidentiality document conforming to the restrictions of this
Section 5.1.
ARTICLE VI. NON-COMPETITION
6.1 Acknowledgments. The Contractor agrees and acknowledges that:
(1) it shall be in a position of confidence and trust with the
Company and it shall have access to Company Confidential
Information; (it) the nature and periods of restrictions imposed
by the covenants set forth in this Article VI are fair,
reasonable and necessary to protect and preserve for the Company
the benefits of this Agreement and that such restrictions shall
not prevent Contractor from earning income in its profession;
(iii) the Company would sustain irreparable loss and damage if
the Contractor were to breach any of such covenants; (iv) the
Company has advised the Contractor that the Company intends to
acquire financial services businesses actively in the Territory;
(v) the Territory is reasonably sized inasmuch as the business of
the Company is conducted over a wide geographical area and is
based on servicing practices in the entire Territory to be
successful. The Contractor represents and
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warrants that the Contractor has not, prior to the date hereof,
disclosed to any person or used or otherwise exploited for the
Contractor's own benefit or for the benefit of any other person
any Company Confidential Information. Contractor agrees to
require each and every employee of contractor representing the
Company to execute a document reciting the provisions of this
Section 6. 1.
6.2 Non-Competition by Contractor. Contractor agrees that, during
the term of its retention by the Company and for a period of two
(2) years following the expiration or termination of Contractor's
retention with the Company for any reason, Contractor will not
directly or indirectly, alone or as a partner, officer, director,
shareholder or employee, as well as Contractor of any other firm;
engage in any business activity which is directly or indirectly
in competition with any financial services offered by the Company
during the term of the Agreement or as of the date of such
expiration or termination of retention or with any part of the
Company's contemplated business with respect to which Contractor
has Confidential Information as governed by Article V, within the
Territory.
6.3 Solicitation of Prospective Acquisition Candidates. For a period
of two (2) years after the expiration or termination of
Contractor's retention with the Company for any reason
whatsoever, Contractor will not solicit any entity or the owner
of any entity which was (during Contractor's retention) a
prospective acquisition candidate of the Company or a client of
Customer.
6.4 Covenant Not to Recruit. Contractor recognizes that the Company
work force represents a substantial financial and educational
investment and constitutes an important and vital aspect of its
business on a worldwide basis. Contractor agrees that, during
the term of its retention by the Company and for a period of two
(2) years following the expiration or termination of Contractor's
retention with the Company for any reason whatsoever, it shall
not solicit, or assist anyone else in the solicitation of,
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any of the Company's then current employees to terminate their
employment with the Company and to become employed or retained
any business enterprise with which the Contractor may then be
associated, affiliated or connected.
6.5 Consent to Injunction. The Contractor acknowledges that its
breach of any provision set forth in this Article VI would result
in irreparable injury to the Company and that the Company's
remedies at law for such a breach would be inadequate and
extremely difficult to calculate or determine. Accordingly, the
Contractor agrees and consents that upon such a breach or
threatened breach by the Contractor of any provision set forth
herein, the Company shall, in addition to all other remedies
available at law and in equity, be entitled to a temporary
restraining order and to both preliminary and permanent
injunctions to prevent or halt such a breach or threatened
breach.
6.6 Severability; Reformation. If any of the provisions, or portions
thereof, of this Agreement are held to be unenforceable or
invalid by any arbitrator or court of competent jurisdiction, the
validity and enforceability of the remaining provisions, or
portions thereof, will not be affected and shall continue in
force. If any arbitrator or court of competent jurisdiction
determines that the scope, duration or geographical limit of any
of the restrictions contained in this Agreement is unenforceable,
it is the intention of the parties that the restrictions shall
not thereby be terminated but rather shall be amended and revised
to the extent required to render them valid and enforceable.
6.7 Separate Agreement. Contractor agrees that its agreements
contained herein shall be construed as agreements independent of
any other agreements with the Company and are independently
supported by good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and further
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agrees that this Agreement shall be interpreted, construed and
enforced separate and apart from any other agreements between or
among the parties hereto. Contractor rather agrees that any
claim or cause of action of Contractor against the Company or any
other party hereto arising out of any other agreement or arising
out of any set of facts outside the scope of this Agreement shall
not constitute a defense to the enforcement by the Company or its
assigns of the agreements of Contractor contained herein.
6.8 Injunctive Relief. The parties hereto recognize and hereby
acknowledge that it is impossible to measure in money the damages
which would result to the Company or its successors or assigns by
reason of a failure by Contractor to perform any of the
obligations imposed upon him under Article V and Article VI of
this Agreement. Therefore, the Company or its successors or
assigns shall be entitled to injunctive and other equitable
relief to enforce the terms of Article V and Article VI of this
Agreement, without the necessity of showing irreparable harm and
without the necessity of posting bond or security. If the
Company or its successors or assigns should institute an action
or proceeding to enforce the provisions of Article V or Article
VI hereof, Contractor hereby waives the claim or defense; that
any such party has an adequate remedy at law, and Contractor
shall not urge in any action or proceeding the claim or defense
that such a remedy at law exists. At the discretion of the court
or arbitrator before which an injunctive proceeding is brought,
the running of the covenants herein may be tolled and extended
for a period of time equal to the time period Contractor shall be
in violation of any such covenant.
6.9 Remedies Cumulative and Concurrent. The rights and remedies of
the Company as provided in the Article VI shall be cumulative and
concurrent and may be pursued separately, successively or
together against the Contractor at the sole discretion of the
Company, and may be exercised as often as occasion therefor shall
arise. The failure
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to exercise any right or remedy shall in no event be construed
as a waiver or release thereof.
6.10 Contractor agrees to require each and every salesperson employed
by Contractor representing the Company to execute a document
reciting the requirements of this Article VI which shall be in
favor of Company and made a condition of every sales persons
employment by Contractor in Company's business.
ARTICLE VII. GENERAL PROVISIONS
7.1 Assignment. Other than to a parent or controlled entity, the
Agreement is not assignable by the Contractor or by the Company.
7.2 Offsets. Any amount payable to contractor pursuant to this
Agreement may be reduced for purposes of offsetting, either
directly or indirectly, any indebtedness or liability of
Contractor to the Company supported by a judgment of a court
of competent jurisdiction.
7.3 Captions. The various headings or captions in this Agreement
are for convenience only and shall not affect the meaning or
interpretation of this Agreement.
7.4 Governing Law; Arbitration. The validity and construction of
this Agreement shall be governed by the laws of the State of
Delaware. The parties (meaning Contractor on one hand and the
Company on the other hand) agree that all disputes concerning
this Agreement shall be submitted to binding arbitration in
accordance with the commercial arbitration rules of the American
Arbitration Association and the provisions contained herein. The
arbitration shall be conducted in Wilmington, Delaware, by one
arbitrator. The party initiating arbitration shall give the
other party notice of the matter in dispute. If the parties fail
to agree upon an arbitrator within ten days after notice of
initiation of the arbitration is given, then the American
Arbitration Association shall
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select the arbitrator. All determinations and the final decision
of the arbitrator shall be made in writing. The fees and expenses
of the arbitrator shall be awarded by the arbitrator in his
discretion as part of the award. The arbitrator's award shall
be binding on the parties hereto and may be entered in any court
of competent jurisdiction. The parties reserve the fight to seek
a judicial temporary restraining order, preliminary injunction,
or other similar short term equitable relief prior to the
appointment of the arbitrator. The arbitrator will have the
fight to make a final determination of the parties' rights
including, without limitation, whether to make permanent, modify
or dissolve the judicial order.
7.5 Construction. Wherever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective
and valid under applicable law, but if any provision of the
Agreement shall be prohibited by or invalid under applicable law,
such provision shall be ineffective only to the extent of such
prohibition or invalidity without invalidating the remainder of
such provision or the remaining provisions of this Agreement.
7.6 Waivers. No failure on the plan of either party to exercise, and
no delay in exercising, any right or remedy hereunder shall
operate as a waiver thereof; nor shall any single or partial
exercise of any fight or remedy hereunder preclude any other or
further exercise thereof or the exercise of any other right or
remedy granted hereby or by any related document or by law.
7.7 Modification. This Agreement may not be modified or amended
except by written instrument signed by the parties hereto.
7.8 Notices. All notices, demands and other communications hereunder
shall be written and shall be deemed to have been duly given if
delivered in person or mailed by certified mail, postage prepaid,
to the address set forth below:
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To the Company: National Medical Financial Services
Corporation
Attn: Xxxxxxx X. Xxxxxxx, M.D.
0000 Xxxxx Xxxxx
Xxxxx Xxxxxxx, XX 00000
With a copy to: Xxxxx X. Xxxxxxx, Esq.
X.X. Xxx 000
Xxxxxxx, XX 00000-0000
To the Contractor: Bradford Group, Inc.
00000 Xxxxx Xxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxxx X. Xxxxxx, President
or to such other address as either party may designate by notice
to the other. Notices delivered in person shall be deemed
delivered on the date of delivery and notices mailed, as
aforesaid, shall be deemed delivered forty-eight (48) hours after
the date mailed. Rejection or other refusal to accept or
inability to deliver because of a changed address of which no
notice was given shall be deemed to be a receipt of the notice,
request or other communication. Any notice, request or other
communication required or permitted to be given by any party may
be given by such party's legal counsel.
7.9 Entire Agreement. This Agreement constitutes the entire
agreement and understanding between the parties hereto in
reference to all the matters herein agreed upon.
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IN WITNESS THEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.
CONTRACTOR: COMPANY:
Bradford Group, Inc. National Medical Financial
Services Corporation
By: /s/ Xxxxxxxx X. Xxxxxx By: /s/ Xxxxxxx X. Xxxxxxx, M.D.
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Xxxxxxxx X. Xxxxxx Xxxxxxx X. Xxxxxxx, M.D.
President Chairman
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