SERVICES AGREEMENT
THIS SERVICES AGREEMENT ("Agreement") is entered into by and between
Park City Group, Inc., a Delaware corporation (the "Company") and Fields
Management, Inc., a Utah Corporation ("Fields"), effective as of July 1, 2005.
Recitals:
A. Fields is a corporation in the business of providing executive
management services, including performing the functions of
President and Chief Executive Officer for the Company.
B. This Agreement is made to protect the Company's legitimate and
legally protectible property and business interests.
C. This Agreement is entered into in order to define the terms
and conditions of Fields' relationship with the Company.
D. This Agreement amends and replaces that certain Services
Agreement between the parties hereto dated July 1, 2003
Agreements:
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained in, and the mutual benefits to be derived from this Agreement, and for
other good and valuable consideration, the Company and Fields agree as follows:
1. Independent Contractor.
The Company hereby retains Fields, and Fields hereby accepts such
retainer, on the terms and conditions of this Agreement. It is understood and
agreed that Fields and its employees or other individuals it uses to perform the
services set forth herein for the Company, are independent contractors and not
employees of the Company.
2. Term of the Services.
This Agreement shall be effective July 1, 2005 and continue pursuant to
the terms hereof until the 30th day of June 2008 (the "Initial Term"), unless
sooner terminated pursuant to the terms hereof or extended at the sole
discretion of the Company's Board of Directors. The Initial Term and any
subsequent terms will automatically renew for additional one year periods
unless, six months prior to the expiration of the then current term, either
party gives notice to the other that the Agreement will not renew for an
additional term. In the event of such written notice being timely provided by
the Company, Fields shall not be required to perform any responsibilities or
duties to the Company during the final two months of the then-existing term. In
such event, the Company will remain obligated to Fields for all compensation and
other benefits set forth herein and in any written modifications hereto.
3. Duties.
(a) General Duties. Fields shall provide to the Company an
individual (the "Executive") to fill the role and perform the functions
of President and Chief Executive Officer of the Company, and shall have
such duties, responsibilities and obligations as are established by the
Bylaws of the Company or are generally required of persons employed in
similar positions. This shall include full executive powers of these
positions over all operating and financial officers, the authority to
hire and fire officers and employees, and to authorize expenditures of
money for corporate purposes, subject to the right of the Board of
Directors to impose reasonable restrictions and requirements.
(b) Performance. To the best of his ability and experience,
the Executive will at all times loyally and conscientiously perform all
duties, and discharge all responsibilities and obligations, required of
and from him pursuant to the express and implicit terms hereof, and to
the reasonable satisfaction of the Company. The Executive shall devote
as much of his time, energy, skill and attention as is required to the
business of the Company, and the Company shall be entitled to all of
the benefits and profits arising from or incident to all such work,
services, and advice of Executive rendered to the Company.
(c) Outside Activities. Nothing in this Agreement shall
prohibit Executive from directing his personal investments or accepting
speaking or presentation engagements in exchange for honoraria, or from
rendering services to, or serving on boards of, charitable
organizations, so long as such activities do not interfere or conflict
with the performance of Fields' duties hereunder.
(d) Additional Services. Fields may be asked from time to time
by the Company to provide other services which Fields can provide using
other of its employees in addition to the Executive. Compensation to
Fields for such additional services shall be agreed upon at the time of
the request.
4. Compensation and Benefits.
(a) Fee. The Company shall pay to Fields an annual base fee of
$300,000 ("Annual Base Fee"). The Annual Base Fee, which shall be
pro-rated for any partial period, will be payable in equal semi-monthly
installments.
(b) Indemnification; D&O Insurance. The Company shall
indemnify Fields to the fullest extent of that which is available under
Chapter 78 of the Nevada Revised Statutes, and shall provide director's
and officer's insurance with such coverages, in such amounts and from
such insurers as constitutes good practices by comparable companies in
the same business as the Company. Such insurance shall provide defense
and coverage obligations for any claim arising out of Fields' or
Executive's acts or omissions committed during the Initial Term or any
subsequent term hereof, regardless of when such claims are asserted.
(c) Incentive Bonus. An incentive bonus, based upon the
Company's achievement of performance goals shall be paid to Fields. The
goals will be pre-determined each year by the Compensation Committee of
the Board of Directors in discussion with the Executive.
(d) Travel and Business Expense Reimbursement. The Company
shall promptly reimburse Fields for all of Executives reasonable travel
and business expenses.
(e) Company Vehicle. The Company shall reimburse Fields for
the costs of a vehicle of Executives choice. The reimbursement shall
not exceed $1,200.00 per month plus applicable deposits if purchased on
a monthly installment contract or leased pursuant to a operating lease.
The Company shall also pay reasonable operating costs of such vehicle
to include insurance, registration and taxes, maintenance, fuel and
other related costs.
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(f) Computer Equipment. The Company shall provide to Fields an
annual allowance of up to $6000 to be used to acquire miscellaneous
computer equipment.
(g) Life Insurance. The Company shall maintain and pay the
premiums for two term life insurance policies in the name of the
Executive for at least $10,000,000 each, with the beneficiary of each
to be designated by the Executive at his sole discretion. Coverage of
the two policies shall continue until June 30, 2006. Thereafter, the
Company's obligation shall be to maintain and pay the premiums for one
policy in the name of the Executive for at least $10,000,000, with the
beneficiary to be designated by the Executive at his sole discretion.
5. Proprietary Information.
(a) Obligation. Neither Fields nor the Executive shall not
disclose, publish, disseminate, reproduce, summarize, distribute, make
available or use any Proprietary Information, except in pursuance of
Fields' duties, responsibilities and obligations under this Agreement
and for the benefit of the Company.
(b) Definition. As used in this Agreement, "Proprietary
Information" means information that is (i) designated as
"confidential," "proprietary" or both by the Company or should have
been known to be "confidential" or "proprietary" to the Company from
the nature of the information or the circumstances of its disclosure,
and (ii) has economic value or affords commercial advantage to the
Company because it is not generally known or readily ascertainable by
proper means by other persons. By way of illustration, Proprietary
Information includes but is not limited to information relating to the
Company's products, services, business operations, business plans and
financial affairs, and customers; any application, utility, algorithm,
formula, pattern, compilation, program, device, method, technique,
process, idea, concept, know-how, flow chart, drawing, standard,
specification, or invention; and any tangible embodiment of Proprietary
Information that may be provided to or generated by Fields or the
Executive.
(c) Return upon Termination. Upon the termination of this
Agreement for any reason, and at any time prior thereto upon request by
the Company, Fields shall return to the Company all tangible
embodiments of any Proprietary Information in its or the Executive's
possession, including but not limited to, originals, copies,
reproductions, notes, memoranda, abstracts, and summaries.
(d) Ownership. Any Proprietary Information developed or
conceived by the Executive during the term of this Agreement shall be
and remain the sole property of the Company. Fields agrees promptly to
communicate and disclose all such Proprietary Information to the
Company and to execute and deliver to the Company any instruments
deemed necessary by the Company to perfect the Company's rights in such
Proprietary Information.
6. Termination of Services.
(a) Additional Definitions. For purposes of this Agreement,
the following terms shall have the meanings assigned below:
(i) "Cause" means (A) conviction of a crime involving
moral turpitude, or (B) a determination by the Board of
Directors of the Company in good faith that Fields [1] has
failed to substantially perform the duties as set forth
herein, [2] has engaged in grossly negligent, dishonest or
unethical activity, or [3] has breached a fiduciary duty or a
covenant hereunder, including without limitation the
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unauthorized disclosure of Company trade secrets or
confidential information, resulting in material loss or damage
to the Company.
(ii) "Change in Control of the Company" means a
change in control of a nature that would be required to be
reported in response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the Securities Exchange Act
of 1934 (the "Exchange Act"), if the Company were subject to
such reporting requirements; provided that, without
limitation, such a change in control shall be deemed to have
occurred if any "person" (as such term is used in paragraph
13(d) and 14(d) of the Exchange Act) who on the date hereof is
not a director or officer of the Company, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the
Company representing 30% or more of the combined voting power
of the Company's then outstanding securities.
(iii) "Determination Date" means (A) if this
Agreement is terminated by reason of a Change in Control of
the Company, the date specified in the Notice of Termination,
(B) if this Agreement is terminated for Cause by reason of
conviction of a crime involving moral turpitude, the date on
which a Notice of Termination is given, or (C) if this
Agreement is terminated for Cause for a reason other than
specified in (B), thirty (30) days after Notice of Termination
is given, provided that Fields shall not have cured the reason
for such Cause during such thirty (30) day period.
(iv) "Good Reason" means a failure by the Company to
comply with any material provision of this Agreement which has
not been cured within ten (10) days after notice of such
noncompliance has been given by Fields to the Company.
(v) "Notice of Termination" means a notice which
shall indicate the specific termination provision in this
Agreement relied upon and shall set forth in reasonable detail
the facts and circumstances claimed to provide a basis for
termination under the provision so indicated. Any termination
of this Agreement by the Company or by Fields (other than
termination pursuant to subsection 6(b) hereof) shall be
communicated by written Notice of Termination to the other
party hereto.
(b) Termination By The Company For Cause. This Agreement may
be terminated without breach of this Agreement for Cause, upon written
Notice of Termination from the Company to Fields and Fields' failure to
cure such Cause as provided in Section 6(a)(iii)(C) hereof. If this
Agreement is terminated for Cause, the Company shall pay Fields its
full Annual Base Fee accrued through the Determination Date, and the
Company shall have no further obligation to Fields under this Agreement
for other compensation or benefits accrued but unpaid prior to the
Determination Date.
(c) Termination On Change of Control of the Company. This
Agreement may be terminated without breach of this Agreement at any
time within twelve months following a Change in Control of the Company
at the election of Fields. If the is terminated pursuant to this
Section 6(c) is terminated, Fields shall be entitled to receive the
compensation, benefits and reimbursement earned or accrued by Fields
under the terms of this Agreement prior to the Determination Date,
including any incentive bonus. In addition, Fields shall receive as a
severance payment the balance of Fields' compensation through the end
of the then current term of this Agreement. Also, upon Fields'
termination in connection with this Section 6(c), Fields shall be
entitled to an annual bonus for the remaining period of this contract
equal to the bonus due to Fields for the immediately preceding fiscal
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year. This Agreement may not be terminated by the Company following a
Change in Control of the Company without it being a breach of this
Agreement.
(d) Termination by Fields. Fields may terminate this Agreement
for Good Reason or if the health of the Executive should become
impaired to an extent that makes continued performance of Fields duties
hereunder hazardous to his physical or mental health or his life,
provided that Fields shall have furnished the Company with a written
statement from a qualified doctor to such effect and, provided further,
that, at the Company's request, the Executive shall submit to an
examination by a doctor selected by the Company and such doctor shall
have concurred in the conclusion of Fields' doctor. If shall terminate
this Agreement pursuant to this Section 6(d), Fields shall be entitled
to receive the following:
(i) the compensation, benefits and reimbursement
earned or accrued by Fields under the terms oft his Agreement
prior to the Determination Date, including any incentive
bonus,
(ii) if Fields shall terminate this Agreement for
Good Reason consisting of the Company's material breach of
this Agreement, severance, including bonuses, as defined in
Section 6 (c) shall be due and payable to Fields.
7. Miscellaneous.
(a) Severability. If any provision of this Agreement is found
to be unenforceable by a court of competent jurisdiction, the remaining
provisions shall nevertheless remain in full force and effect.
(b) Notices. Any notice required or permitted hereunder to be
given by either party shall be in writing and shall be delivered
personally or sent by certified or registered mail, postage prepaid, or
by private courier, or by facsimile or telegram to the party to the
address the party may designate from time to time. A notice delivered
personally shall be effective upon receipt. A notice sent by facsimile
or telegram shall be effective 24 hours after the dispatch thereof. A
notice delivered by mail or by private courier shall be effective on
the 3rd day after the day of mailing.
(c) Attorney's Fees. In the event of any action at law or
equity to enforce or interpret the terms of this Agreement, the
prevailing party shall be entitled to reasonable attorneys' fees and
court costs in addition to any other relief to which such party may be
entitled.
(d) Governing Law. This Agreement shall be interpreted,
construed, governed and enforced according to the laws of the State of
Utah. If any provision of this Agreement is determined by a court of
law to be illegal or unenforceable, then such provision will be
enforced to the maximum extent possible and the other provisions will
remain in full force and effect.
(e) Successors and Assigns. The rights and obligations of the
Company under this Agreement shall inure to the benefit of and shall be
binding upon the successors and assigns of the Company.
(f) Entire Agreement. This Agreement constitutes the entire
agreement between the parties with respect to the services described
herein. This Agreement can be amended or modified only in a writing
signed by Fields and an authorized representative of the Company.
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(g) Signature by Facsimile and Counterpart. This Agreement may
be executed in counterpart, and facsimile signatures are acceptable and
binding on the parties hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and signed as of the day and year first above written.
"Company" "Fields"
PARK CITY GROUP, INC., FIELDS MANAGEMENT, INC.,
a Delaware corporation a Utah corporation
By:__________________________________ By:________________________________
Name: Will Xxxxxxx Name: Xxxxxxx X. Xxxxxx
Title: CFO Title: President
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