CONSULTING AGREEMENT
Exhibit
10.14
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This CONSULTING AGREEMENT (this
“Agreement”) is made effective as of the 25th day of August, 2008 (the
“Effective Date”), by and between The Amacore Group, Inc., a Delaware Corporation
(the “Company”), and Xxxxx Xxxxxxx, an individual resident of the state of
Florida (the “Consultant”).
R E C I T A L
S:
WHEREAS, the Company desires to engage
the Consultant to perform the consulting services as more fully set forth
herein; and
WHEREAS, the Consultant desires to be
engaged by the Company on the terms and conditions set forth in this
Agreement.
NOW, THEREFORE, in consideration of the
Recitals and of the mutual promises and covenants set forth herein and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, it is hereby agreed as follows:
1. Engagement. The
Company hereby engages the Consultant to perform the Services (as defined
herein) and the Consultant hereby accepts such engagement with the Company in
accordance with the terms and conditions set forth in this
Agreement. The Consultant shall devote such time and attention to the
Services as are reasonably necessary to perform such Services, but the Company
acknowledges that this Agreement is not exclusive and that Consultant can
provide non-competing services to other entities or on his own
behalf.
2. Services. The
Consultant shall provide on a non-exclusive basis to the Company management,
business, operational, medical, and other consulting services from time to time
as may be requested by the Company or its agents or representatives (the
“Services”).
3. Consulting Fee. In
consideration for performing the Services for the Company, the Company shall pay
the Consultant an annual fee of Two Hundred Thousand Dollars ($200,000), which
fee shall be payable in equal installments in accordance with the Company’s
customary payroll practices. In addition, the Company
agrees to forgive debt owed by Consultant under a promissory note in the amount
of $46,000 and further agrees to gross up the fee payable hereunder in such
amount equal to the amount of taxes payable by the Consultant by reason of the
forgiveness of the foregoing debt.
4. Other Consulting
Arrangements.
(a) Health and Dental
Benefits. Pursuant to that certain Separation Agreement (the
“Separation Agreement”) by and between the Company and the Consultant, dated as
of an even date herewith, the Company has agreed to provide certain benefits to
the Consultant after the separation of Consultant’s employment from the
Company. The Consultant acknowledges and agrees that he has received
information regarding his right to elect continuation of his group health and
dental insurance coverage under federal law (“COBRA”), which if elected may
allow him to continue that insurance coverage for up to an eighteen (18)-month
period after his separation. Pursuant to the Separation Agreement,
the Company shall pay the COBRA premium, if elected by the Consultant, for the
Term of this Agreement. After such time, if the Consultant
wishes to continue COBRA coverage, the Consultant agrees that he shall be
responsible for the full COBRA premium. The Company’s obligation to
provide benefits under this Agreement shall under no circumstances exceed
payment of the COBRA premium for eighteen (18)-months.
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(b) Expense
Reimbursement. Provided that the Consultant has incurred
business expenses that are reasonable, appropriate and consistent with expenses
while employed by the Company (considering, among other things, the entire set
of circumstances) in the pursuit of the Services hereunder, the Company shall
pay, upon submission of appropriate vouchers and supporting documentation, such
expense incurred by the Consultant, according to Company policy.
5. Term and
Termination.
(a) Term. This
Agreement shall commence as of the Effective Date and shall continue in full
force and effect for a period of one year thereafter (the “Initial Term”),
unless earlier terminated as provided herein. This Agreement may be
renewed for successive one-year periods upon mutual agreement of the parties
(each a “Renewal Term” and together with the Initial Term, the
"Term").
(b) Termination. This
Agreement may be terminated prior to expiration of the Initial or any Renewal
Term as provided in paragraph 5(a) above, by prior written notice to the other
party as follows:
(i)
by either party, in the event the other
party should breach or fail to perform any of its material obligations hereunder
and should fail to remedy such breach or nonperformance within thirty (30)
calendar days after receiving written demand
therefor. Notwithstanding, the Company may not claim a breach of
non-performance based on the number of hours Consultant works or based on
requested travel not taken by Consultant;
(ii) by
either party, effective immediately, if the other party shall has
been convicted of a felony violation or if Consultant is arrested or charged
with a crime not instigated by the Company and such arrest or charge negatively
effects the business or reputation of ACGI; or
(iii)
by the Company, effective immediately, if the
Consultant (1) knowingly makes any materially false or untrue statements or
representations to the Company herein or in the performance of its obligations
hereunder; or (2) engages in gross negligence, willful misconduct or fraud in
the performance of the Services hereunder.
6. Return of
Materials. Upon termination of this Agreement for any reason,
the Consultant shall promptly return to the Company all files, credit cards,
keys, instruments, equipment, vehicles, and any other property or materials
provided to the Consultant by the Company.
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7. Covenant Not to
Compete.
(a) Scope of
Covenant. The Consultant agrees that, subject to 7(b) herein,
during any Term of this Agreement and for a period of one (1) year commencing
upon the expiration or termination of the Consultant’s engagement hereunder (for
any reason whatsoever except if termination occurs by reason of Company's
breach) (the “Termination Date”) the Consultant shall not, directly or
indirectly, for himself or on behalf of or in conjunction with any other person,
persons, company, partnership, corporation or business of whatever nature,
without the prior written consent of the Company:
(i) engage,
as an officer, director, shareholder, owner, partner, joint venturer, or in a
managerial capacity, whether as an employee, independent contractor, consultant
or advisor, or as a sales representative, in any Business (as defined in
(ii) below)business selling any products or services in direct competition with
the Company or any of its subsidiaries anywhere in the United States, its
territories or possessions (the “Territory”);
(ii) solicit
any person who is at the Termination Date, or who was within one (1) year prior
to the Termination Date, an employee of the Company or any of its subsidiaries
for the purpose or with the intent of enticing such employee away from or out of
the employ of the Company or any of its subsidiaries, except Xx. Xxxxx Xxxxxx,
Xx. Xxx Xxxxxxx and Xx. Xxxxxx Xxxxxx as well as Xxxxx Xxxxxxx if the Company
terminates Xx. Xxxxxxx;
(iii) call
upon any person or entity which is, at the Termination Date or which has been,
within one (1) year prior to Termination Date a customer of the Company or any
of its subsidiaries within the Territory for the purpose of soliciting or
selling products or services in direct competition with the Company or any of
its subsidiaries in its Business within the Territory, where Business is defined
as health care products or programs that are being sold by the Company as of the
Effective Date; or
(iv) engage
in any act intended to cause any customer or potential customer of the Company
located in the Territory with whom the Consultant had contact to discontinue,
curtail or forego Business with the Company or to do Business with another
entity, firm, business or enterprise which is competitive with the Business of
the Company or its clients.
Provided,
however, that nothing in this Section 7(a) shall be construed to preclude the
Consultant from acquiring as a passive investment not more than 5% of the
capital securities of any business enterprise whether or not engaged in
competition with the Company or its subsidiaries, if and to the extent such
securities are actively traded on a national securities exchange or in the
over-the-counter market in the United States or on any foreign securities
exchange.
(b) Target Companies Activities
Allowed. Notwithstanding Section 7(a), unless the Company by
written notice has informed Consultant that the Company has entered into
definitive agreement(s) with target companies listed on Schedule A hereto (each
a "Target" and collectively, the "Targets"), then at any time after the close of
business on September 15, 2008, Consultant can freely conduct any activities
related to Target(s) without violating Section 7(a) and without breaching this
Agreement. Such activities may include, but are not limited to,
conducting due diligence, acquiring an interest, acquiring a controlling
interest, meeting with potential investors, raising funds, reviewing potential
transactions, and meeting with management from either
company. But if Consultant does move forward with any activity
resulting in Consultant's directly or indirectly acquiring an interest (greater
than 5%) in any Target(s), or becoming an officer, director, shareholder, owner,
partner, joint venturer, or in a managerial capacity, whether as an employee,
independent contractor, consultant or advisor in Target(s), he will resign from
the Board of Directors of Company and this Agreement will
terminate.
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(c) Reasonableness. The
Consultant acknowledges that the Company and its subsidiaries are currently and
actively pursuing plans to expand their operations throughout the entire
Territory, both through operational growth and by the acquisition of businesses,
which may or may not be identified as of the date of this
Agreement. The Consultant acknowledges and agrees that the
restrictions set forth in this Section 7 are founded on valuable consideration
and are reasonable in duration and geographic area in light of the activities
and business of the Company and it subsidiaries on the date of the execution of
this Agreement and the current plans of the Company and its subsidiaries and
that such restrictions are necessary to protect the legitimate interests of the
Company. It is also the intent of the Company and the Consultant that
such covenants be construed and enforced in accordance with the changing
activities, business and locations of the Company and it subsidiaries throughout
the term of this covenant.
(d) Severability. The
covenants in this Section 7 are severable and separate, and the unenforceability
of any specific covenant shall not affect the provisions of any other covenant.
Moreover, in the event any court of competent jurisdiction shall determine that
the scope, time or territorial restrictions set forth are unreasonable, then it
is the intention of the parties that such restrictions be enforced to the
fullest extent which the court deems reasonable, and this Agreement shall
thereby be reformed.
(e) Enforcement by the Company
Not Limited. All of the covenants in this Section 7 shall be
construed as an agreement independent of any other provision in this Agreement,
and the existence of any claim or cause of action of the Consultant against the
Company, whether predicated in this Agreement or otherwise, shall not constitute
a defense to the enforcement by the Company of such covenants. It is
specifically agreed that the period of one year stated at the beginning of this
Section 7, during which the agreements and covenants of the Consultant made in
this Section 7 shall be effective, shall be computed by excluding from such
computation any time during which the Consultant is in violation of any
provision of this Section 7.
8. Confidentiality and
Proprietary Rights.
(a) Confidentiality. The
Consultant acknowledges that, by reason of his providing Services to the
Company, he will have access to confidential information of the Company and its
subsidiaries and affiliates, including, without limitation, information and
knowledge pertaining to products, inventions, discoveries, improvements,
innovations, designs, ideas, trade secrets, proprietary information,
manufacturing, packaging, advertising, distribution and sales methods, sales and
profit figures, customer and client lists and relationships between the Company,
any of its subsidiaries or affiliates and dealers, distributors, sales
representatives, wholesalers, customers, clients, suppliers and others who have
business dealings with them (“Confidential Information”). The
Consultant acknowledges that such Confidential Information is a valuable and
unique asset of the Company and its subsidiaries and affiliates and covenants
that, both during and for a period of five years after the Term, he will not
disclose any Confidential Information to any person without the prior written
authorization of the Company. The obligation of confidentiality
imposed by this Section 8 shall not apply to (a) Confidential Information that
otherwise becomes generally known in the industry or to the public through no
act of the Consultant in breach of this Agreement or any other party in
violation of an existing confidentiality agreement with the Company or any of
its subsidiaries or affiliates or (b) Confidential Information which is required
to be disclosed by court order or applicable law.
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(b) Use of Confidential
Information. The Consultant shall not use any portion of the
Confidential Information supplied by the Company hereunder or any patent,
trademark, or other intangible property right of the Company, except as his
obligations under this Agreement may require.
(c) Protection of Proprietary
Rights. The Consultant agrees to cooperate with and assist the
Company, at the Company’s expense, in the protection of trademarks, patents, or
copyrights owned by or licensed to the Company, and shall inform the Company
immediately of any infringements or other improper action with respect to such
trademarks, patents, or copyrights that shall come to the attention of the
Consultant.
(d) HIPAA. The Consultant
acknowledges that while performing the Services for the Company, the Consultant
may have access to and obtain knowledge of certain confidential information
about patients of the Company clients that is protected by the Health Insurance
Portability and Accountability Act of 1996 (“HIPAA”). The Consultant
hereby acknowledges receipt of information regarding compliance with HIPAA and
agrees to abide by the requirements of HIPAA.
9. Indemnification.
(a) The
Company shall indemnify and hold harmless the Consultant from and against all
losses, damages, costs, expenses (including without limitation, expenses
incurred in connection with investigating, defending or enforcing any action,
suit, claim, investigation or proceeding incident to any matter indemnified
hereunder), liabilities, claims, settlement payments, fines, penalties,
corrective or remedial costs, awards, judgments, interest, diminution in value,
and other charges or damages of any kind (including, without limitation,
reasonable attorneys' fees and other reasonable legal costs and expenses,
including without limitation those incurred in connection with any suit, action,
claim, investigation or other proceeding) (collectively, “Losses”) incurred by
the Consultant in connection with any claim against the Consultant or a
proceeding to which the Consultant is party on account of, arising out of or
relating to the Consultant’s performance of Services hereunder; provided that
the Company shall have no indemnification obligation: (i) to the extent of the
Consultant’s fraud, bad faith, gross negligence or willful misconduct; (ii) for
representations or statements made by Consultant in his role as a Consultant not
specifically authorized by Company herein or otherwise in writing, or (iii) any
violation by the Consultant of any applicable law or regulation.
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(b) The
Consultant shall indemnify and hold harmless the Company, and the Company’s
affiliates and their respective officers, directors, employees, representatives
and agents (for purposes of this Section 9(b), the “Company”), from and against
all Losses incurred by the Company in connection with any claim against the
Company or a proceeding to which the Company is party on account of, arising out
of or relating to (i) the Consultant’s fraud, bad faith, gross negligence or
willful misconduct; (ii) representations or statements made by the Consultant,
or (iii) any violation by the Consultant of any applicable law,
regulation.
10. Specific
Performance. Consultant consents and agrees that if the
Consultant violates any of the provisions of Sections 6, 7, or 8 hereof, the
Company and its subsidiaries and affiliates would sustain irreparable injury and
that monetary damages would not provide adequate remedy to the Company or any of
its subsidiaries or affiliates. Therefore, the Consultant hereby agrees that the
Company and any affected subsidiary or affiliate shall be entitled to have
Sections 6, 7, or 8 hereof specifically enforced (including, without
limitation, by injunctions and restraining orders) by any court having equity
jurisdiction. Nothing contained herein shall be construed as
prohibiting the Company or any of its subsidiaries or affiliates from pursuing
any other remedies available to it for such breach or threatened breach,
including the recovery of damages from the Consultant.
11. Independent
Contractor. Consultant
and Company understand and acknowledge that Consultant's relationship with
Company is that of an independent contractor and nothing in this Agreement is
intended to or should be construed to create a partnership or joint venture
relationship. Both parties also acknowledge that the Company
shall have no duty, responsibility, or obligation: (a) to withhold and/or pay
FICA taxes or federal, state or local income and other taxes; (b) to comply with
or contribute to state worker's compensation and/or state or federal
unemployment compensation funds or to comply with any other laws relating to
employees with respect to the Consultant; or (c) to provide the Consultant with
any Company fringe or other benefits available to Company employees; provided
that the Company will provide the Consultant with a report of payments made
under this Agreement on IRS Form 1099-MISC after the end of each calendar
year.
12. Survival. The
obligations set forth in Sections 4, 6, 7, 8, 9, and 10 hereof shall survive any
termination or expiration of this Agreement, and any other Section that provides
a party with rights (including without limitation, rights to receive payments)
that have not been fully satisfied as of such termination or expiration, will
also survive any termination or expiration of this Agreement for any reason
whatsoever.
13. Successors and
Assignment. The Consultant's duties, obligations and services
rendered under this Agreement are personal in nature and are unique and peculiar
to the Consultant. Therefore, without the Company’s prior written
consent, the Consultant shall not assign, transfer, sell, encumber, pledge or
otherwise alienate the Consultant's duties, obligations or responsibilities
under this Agreement. Consultant may assign his rights under this
Agreement. This Agreement cannot be assigned by the Company
without Consultant's prior written consent. This Agreement will be
binding upon and inure to the benefit of the Company and any successor to the
Company, including, without limitation any persons acquiring directly or
indirectly all or substantially all of the business or assets of the Company
whether by purchase, merger, consolidation, reorganization or otherwise (and
such successor shall thereafter be deemed the Company for the purposes of this
Agreement).
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14. Notice. Any
notice (including notice of change of address) permitted or required to be given
pursuant to the provisions of this Agreement shall be in writing and sent by
registered or certified mail, return receipt requested, or by hand delivery to
the parties at the following addresses:
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If
to the Company:
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Attn:
President
0000
X. Xxxxxxxxx Xxxx.
Xxxxx
000
Xxxxx,
XX 00000
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If to the
Consultant:
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Xxxxx
Xxxxxxx M.D.
X.X.
Xxx 00000
Xx.
Xxxxxxxxxx, Xxxxxxx
00000
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Notice
properly given by mail shall be deemed effective three (3) business days after
mailing.
15. Entire
Agreement. This Agreement constitutes the entire agreement and
understanding between the Company and the Consultant concerning the Consultant's
engagement by the Company, and supersedes any and all previous agreements or
understandings, whether written or oral, between the Consultant and the Company
concerning such engagement. This Agreement may only be modified or
amended by a written document executed by all parties hereto.
16. Waiver. The
waiver by either party of the breach of any covenant or provision in this
Agreement shall not operate or be construed as a waiver of any subsequent breach
by either party.
17. Invalidity of Any
Provision. The provisions of this Agreement are severable, it
being the intention of the parties hereto that should any provision hereof be
invalid or unenforceable, such invalidity or unenforceability of any provision
shall not affect the remaining provisions hereof, but the same shall remain in
full force and effect as if such invalid or unenforceable provision were
omitted.
18. Applicable Law and
Venue. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Delaware. With
respect to any suit, action or other proceeding arising from, or relating to,
this Agreement, the parties hereby irrevocably agree to the exclusive personal
jurisdiction and venue of the Federal and state courts located within the state
of Florida.
19. Headings. Headings
in this Agreement are for informational purposes only and shall not be used to
construe the intent of this Agreement.
20. Counterparts. This
Agreement may be executed simultaneously in any number of counterparts, each of
which shall be deemed an original but all of which together shall constitute one
and the same agreement.
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IN WITNESS WHEREOF, the parties hereto
have executed this Consulting Agreement as of the date first above
written.
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CONSULTANT:
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/s/
Xxxxx Xxxxxxx
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Xxxxx
Xxxxxxx, M.D.
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COMPANY:
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/s/ Xxx Xxxxxx
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Xxx
Xxxxxx,
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President
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