EXHIBIT 10.5
CONSULTING AGREEMENT WITH XXXXX XXXXXXXX
EXHIBIT 10.5
INDEPENDENT CONSULTANT AGREEMENT
THIS CONSULTING AGREEMENT (hereinafter referred to as the "Agreement")
is made effective the 1st day of December, 2006, by and between Environmental
Service Professionals, Inc., a Nevada corporation (the "Parent"), Pacific
Environmental Sampling, Inc., a California corporation (the "Company") and Xxxxx
Xxxxxxxx of 0000 Xxxxxxx Xxxxx, Xxxxx Xxxxxxx, Xxxxxxxxxx 00000, herein after
referred to as the "Consultant", with respect to the following facts:
RECITAL
WHEREAS, the Company is in the business of providing environmental
services for the purposes of mold and moisture assessment and management, and in
the conduct of such business desires to have the services listed in EXHIBIT A
performed by the Consultant.
WHEREAS, the Consultant has the necessary education, training, and/or
expertise to perform these services desired by the Company, and further has an
understanding of the Company's business to fully provide such services; and,
WHEREAS, the Consultant will dedicate sufficient time to ESP as needed,
in terms of the agreement the consultant is retained on a non-exclusive basis;
and,
WHEREAS, the Consultant agrees to perform these services (hereinafter
referred to as the "Consulting Services") for the Company under the terms and
conditions set forth in this Agreement.
AGREEMENT
NOW THEREFORE, in consideration of the mutual promises set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is expressly acknowledged, the Parent, the Company and the
Consultant hereto covenant and agree as follows:
SECTION 1. ENGAGEMENT OF CONSULTANT
The Company hereby engages Consultant to assist Company by performing
the services discussed herein, as described in EXHIBIT A hereto, and the
Consultant hereby accepts such engagement, upon the terms and conditions set
forth in this Agreement.
SECTION 2. TERM OF AGREEMENT
This Agreement shall have an initial term of one (1) year (hereinafter
referred to as the "Consulting Period"), from the effective date hereof or until
terminated pursuant to Section Four (4) hereunder.
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SECTION 3. COMPENSATION
The Company shall pay the Consultant as described in EXHIBIT B.
SECTION 4. TERMINATION OF AGREEMENT BY THE COMPANY
Notwithstanding anything to the contrary contained in this Agreement
hereunder, Company may terminate this Agreement if any of the following events
occur:
A. FAILURE TO FOLLOW INSTRUCTIONS. The Company can terminate this
Agreement if Consultant fails to follow Company's instructions. Company must
inform Consultant that Consultant's actions or inactions are unacceptable and
give Consultant fifteen (15) normal business days to comply with Company's
instructions. If Consultant fails to comply, or at a later date makes the same
unacceptable action or inaction, Consultant may immediately be terminated
hereunder by Company's delivery of an applicable written "Notice of Termination"
to Consultant.
B. BREACH OF CONSULTANT'S DUTIES. The Company can immediately terminate
this Agreement if Consultant's actions or conduct would make it unreasonable to
require Company to retain Consultant. Such acts include, but are not limited to,
dishonesty, illegal activities, and/ or activities harmful to the reputation of
the Company;
C. SALE OF COMPANY'S ASSETS. The sale of substantially all of Company's
assets to a single purchaser or group of associated purchasers with sixty (60)
calendar days notice;
D. TERMINATION OF COMPANY'S BUSINESS. Company's bona fide decision to
terminate its business and liquidate its assets with sixty (60) calendar days
notice;
E. MERGER OR CONSOLIDATION. The merger or consolidation of Company with
a third party with sixty (60) calendar days notice; or
F. MUTUAL AGREEMENT. At any time by mutual agreement in writing between
Company and Consultant.
SECTION 5. NONDISCLOSURE OF CONFIDENTIAL INFORMATION
In connection with the Agreement, the Company or the Parent (each a
"Disclosing Party") may disclose to Consultant certain information related to
the Disclosing Party's operations or business (the "Confidential Information").
Consultant will not utilize any Confidential Information received from the
Disclosing Party for any purpose other than for the benefit of the Disclosing
Party or in order to facilitate the transactions contemplated by this Agreement.
Consultant will not utilize the Confidential Information provided to it by the
Disclosing Party to compete with the Disclosing Party, nor will Consultant
engage in reverse engineering of the Disclosing Party's Confidential Information
or any other conduct which would directly or indirectly result in Consultant
misappropriating or improperly utilizing the rights, property, assets, or
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Confidential Information of the Disclosing Party. Consultant will not disclose
the Confidential Information to any third party without the express prior
written consent of the Disclosing Party. Consultant will maintain the
confidentiality of such Confidential Information using at least the same degree
of care customarily used by Consultant to protect his or her own Confidential
Information, but under no circumstances will Consultant use less than a
reasonable degree of care. At the time of the termination of this Agreement (for
any reason), Consultant will return all Confidential Information provided by the
Disclosing Party to Consultant. The Disclosing Party will retain ownership of
all its Confidential Information, whether or not disclosed to Consultant.
In consideration for the Company entering into this Agreement, the
Consultant agrees that the following items, among others, are and shall remain
the sole property of the Company, are secret, confidential, unique, valuable and
were developed by Company at great cost and over a long period of time.
Disclosure of any of the items to anyone other than Company's officers, agents,
or authorized employees shall cause Company irreparable injury:
A. Non-public financial information, accounting information, plans of
operations, possible mergers, or acquisitions prior to the public announcement;
B. Customer lists, franchise lists, partner and co-venturer lists,
other business relationships of the Parent Company, call lists, and other
confidential customer, supplier, and other business relationship data;
C. Memoranda, notes, records concerning the technical processes and
marketing strategies conducted by Company;
D. Sketches, plans, drawings, and other confidential research and
development data;
E. Manufacturing processes, chemical formula, and the composition of
Company's products; or
F. Any digital or intellectual property owned by Company
Consultant further agrees that all methods and programs developed in
the course of delivering services pursuant to this Agreement are the property of
the Company and will be treated on a confidential basis. Consultant further
represents that an employee or subcontractor of the Consultant would, before
they provide any services, be required to assign their rights to any methods or
programs developed as a result of the performance of services under this
Agreement to the Company.
SECTION 6. BEST EFFORT BASIS
Consultant agrees that Consultant shall at all times faithfully and to
the best of its experience, ability and talents, perform all the duties that may
be required of and from Consultant pursuant to the terms of this Agreement.
Consultant does not guarantee that its efforts will have any impact on Company's
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business or that any subsequent financial improvement will result from
Consultant's efforts. Company understands and acknowledges that the success or
failure of Consultant's efforts will be predicated on Company's operating
results.
SECTION 7. PLACE OF SERVICES
It is understood that the Consultant's services will be rendered largely at the
office of the Consultant or such other places as may be required by the nature
of the duties to be performed.
SECTION 8. COSTS AND EXPENSES
Consultant shall be responsible for obtaining prior approval for reasonable
out-of-pocket expenses, travel expenses, third party expenses, filing fees, copy
and mailing expense above one hundred ($100.00) dollars that Consultant may
incur in performing Consulting Services under this Agreement from the Chief
Financial Officer of the Company and submit approved expenses for reimbursement
in a form acceptable to the Company. Company will book all travel and
accommodations.
Consultant shall be responsible to compute and pay all applicable local, state,
and federal taxes, and the Company shall not be responsible for such payments.
Consultant shall be responsible for obtaining and maintaining all applicable
insurance coverage to include but not be limited to Workmen's Compensation,
personal liability, casualty, additional medical, and automobile coverage.
SECTION 9. STATUS OF THE CONSULTANT
Consultant's obligations under this Agreement consist solely of the Consulting
Services described herein. In no event shall Consultant be considered as the
employee or agent of Company or otherwise represent or bind Company. For
purposes of this Agreement, Consultant is an Independent Contractor and will not
be considered an employee of the Company for any purpose. All final decisions
with respect to acts of Company or its affiliates, whether or not made pursuant
to or in reliance on information or advice furnished by Consultant hereunder,
shall be those of Company or such affiliates and Consultant shall under no
circumstances be liable for any expense incurred or loss suffered by Company as
a consequence of such actions or decisions. Further, the Consultant acknowledges
and agrees that:
A. The Consultant meets all required licensing and registration
requirements of the business in which the Consultant will perform duties for the
Company;
B. The Consultant shall hold harmless and indemnify the Company against
all claims, liabilities, expenses, losses, damages, or penalties incurred by the
Consultant as a result of (a) the failure of the Consultant to perform any
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covenant required to be performed by Consultant under this Agreement, or (b) any
accident, damage, death, or injury (physical or monetary) whatsoever arising
from any occurrence in or upon the premises and resulting from the acts or
omissions of Consultant, its agents, contractors, employees, servants,
licensees, or invitee's during the term of this Agreement; provided, however,
that Consultant shall not be obligated to indemnify against liabilities,
expenses, losses or penalties suffered in whole or in part as a result of the
negligence of the Company, its agents, contractors, employees, servants,
licensees, or invitee's.
SECTION 10. COVENANT NOT TO COMPETE
The Consultant agrees that he/she shall not, for a period of twelve (12) months
following the date of the termination of this Agreement, within a radius of one
hundred (100) miles in every direction from the location of any place of
business of the Company, directly or indirectly engage in the same or similar
business to that of the Company, or become interested in (which shall include
but not be limited to becoming an employee, agent, owner, partner, shareholder,
lender, or guarantor) any other business or venture which is the same or similar
to that of the Company. The Consultant agrees that the remedy at law for any
breach of any provision of this article shall be inadequate and that, in
addition to any other remedies that the Company may have, the Company shall be
entitled to injunctive relief without bond.
SECTION 11. GENERAL PROVISIONS
A. HEADINGS. All headings set forth in this Agreement are intended for
convenience only and shall not control or affect the meaning, construction or
intent of this Agreement or any provision thereof. If a conflict exists between
any heading and the text of this Agreement, the text shall control.
B. GENDER. As used herein, all pronouns shall include the masculine,
feminine, neuter, singular and plural thereof, wherever the context and facts
require such construction.
C. AMENDMENT. This Agreement may be amended or modified at any time and
in any manner but only by an instrument in writing executed by the parties
hereto.
D. WAIVER. All the rights and remedies of either party under this
Agreement are cumulative and not exclusive of any other rights and remedies
provided by law. No delay or failure on the part of either party in the exercise
of any right or remedy arising from a breach of this Agreement shall operate as
a waiver of any subsequent right or remedy arising from a subsequent breach of
this Agreement. The consent of any party where required hereunder to any act or
occurrence shall not be deemed to be a consent to any other act or occurrence.
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E. NOTICE. Any notice required to be given under the terms of this
Agreement shall be deemed to have been received when either hand-delivered or
when mailed via certified or registered mail to:
IF TO CONSULTANT: Xxxxx Xxxxxxxx
0000 Xxxxxxx Xxxxx
Xxxxx Xxxxxxx, Xxxxxxxxxx 00000
IF TO COMPANY: ESP
0000 X. Xxxxxxxx Xxxxxx Xxx, Xxxxx 000
Xxxx Xxxxxxx, Xxxxxxxxxx 00000
IF TO PARENT: ESP
0000 X. Xxxxxxxx Xxxxxx Xxx, Xxxxx 000
Xxxx Xxxxxxx, Xxxxxxxxxx 00000
F. ENTIRE AGREEMENT. This instrument contains the entire Agreement
between the parties hereto with respect to the transactions contemplated by the
Agreement. All prior agreements and undertakings with respect thereto are hereby
terminated and shall be of no force or effect. This Agreement may be executed in
any number of counterparts but the aggregate of the counterparts together
constitute only one (1) and the same instrument.
G. EFFECT OF PARTIAL INVALIDITY. In the event that any one or more of
the provisions contained in this Agreement shall for any reason be held to be
invalid, illegal, or unenforceable in any respect, such invalidity, illegality
or unenforceability shall not affect any other provisions of this Agreement, but
this Agreement shall be constructed as if it never contained any such invalid,
illegal, or unenforceable provisions.
H. GOVERNING LAW. This Agreement, and the application or interpretation
thereof, shall be governed exclusively by its terms and by the laws of the State
of California.
I. ATTORNEYS' FEES. If any action at law or in equity, including an
action for declaratory relief, is brought to enforce or interpret the provisions
of this Agreement, the prevailing party shall be entitled to recover actual
attorneys' fees and costs from the other party. The attorneys' fees may be
ordered by the court in the trial of any action described in this paragraph or
may be enforced in a separate action brought for determining attorneys' fees and
costs.
J. TIME IS OF THE ESSENCE. Time is of the essence for each and every
provision of this Agreement.
K. MUTUAL COOPERATION. The parties hereto shall cooperate with each
other to achieve the purpose of this Agreement and shall execute such other and
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further documents and take such other and further actions as may be necessary or
convenient to effect the transactions described herein.
L. NO THIRD PARTY BENEFICIARY. Nothing in this Agreement, expressed or
implied, is intended to confer upon any person, other than the parties hereto
and their successors, any rights or remedies under or by reason of this
Agreement, unless this Agreement specifically states such intent.
M. NO PRESUMPTION. Should any provision of this Agreement require
judicial interpretations, the court interpreting or consulting the same shall
not apply a presumption that the terms hereof shall be more strictly construed
against one party, by reason of the rule of construction that a document is to
be construed more strictly against the person who himself or through his agents
prepared the same, it being acknowledged that both parties have participated in
the preparation hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
20th day of December, 2006.
CONSULTANT: COMPANY:
/s/ Xxxxx Xxxxxxxx /s/ Xxxx Xxxxxxx
----------------------------------- -----------------------------
EVP
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EXHIBIT A
Consultant, as an independent contractor, will use his best efforts to provide
the following Services to the Company during the term of this Agreement:
A. Conduct business on behalf of the Company as the Manager of
Business Development.
B. Establish and supervise the operation of the Company's branch
offices in the State of Washington; and
C. Refer purchasers of Company franchises to the Company for the
sale of franchises in all territories where the Company is
legally permitted to sell franchise.
D. Refer purchasers of Company Certified Environmental Home
Inspector Certification program.
E. Provide verbal and written support for the development of
processes, procedures, presentations and other marketing
material; and for development of new programs and markets
including associated marketing material as requested by the
Company.
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EXHIBIT B
In consideration for the Services to be performed by Consultant for the Company
and provided Consultant complies with standard procedures outlined by management
of the Company for all business development managers the Company shall,
A. pay to Consultant a fee in the amount of $6,000.00 per month
of which $1,200.00 will be paid as W-2 earnings through the
Company's contracted professional service company during the
Term (as herein defined) of this Agreement,
B. provide Consultant access to health insurance during the Term
of this Agreement that is comparable to the health insurance
policy made available to officers of the Company to a maximum
value of $390.00 per month,
C. pay Consultant a referral fee equal to 8% of all initial
franchise fees collected by the Company in cash from
franchisees referred to the Company by Consultant during the
Term of this Agreement,
D. pay Consultant a commission fee equal to $300.00 for each
Certified Environmental Home Inspector fee fully collected by
the Company from individuals or as part of a master franchise
as referred to the Company by Consultant during the Term of
this Agreement, provided Consultant complies with standard
procedures outlined by management of the Company, and
E. the Company will provide all sales leads for Certified
Environmental Home Inspector to Consultant, this exclusivity
will be terminated if the Consultant fails to be timely in
contacting leads,
F. if Company discounts the Certified Environmental Home
Inspector fee the Consultants commission fee will not be
reduced. Consultant has no approval to discount any fees.
G. Company shall pay fees according to the following payment
schedule:
a. W-2 earnings will be paid as per the Company's
current payroll schedule; and
b. balance of monthly fee ($6,000.00 minus W-2 earnings)
will be paid by the 10th day of the month following
the receipt of Consultants invoice; and
c. commission fee will be paid on the 15th day of the
month following Company's receipt of fully paid
Certified Environmental Home Inspector fee.
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H. The Parent agrees to issue to Consultant 500,000 warrants to
purchase 500,000 shares of the Parent's common stock at an
exercise price of $0.75 per share and exercisable for a period
of five years, subject to customary adjustments for stock
splits, stock dividends and similar transactions within 30
days of execution of this Agreement.
I. Each Party to this Agreement will bear its own expenses
incurred in connection with this Agreement.
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