Exhibit 10.19
FINANCIAL PUBLIC RELATIONS / CONSULTING AGREEMENT
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This Agreement, made this 1st day of September 1998, by and between Medical
Dynamics, Inc., (NASDAQ/MEDY) of 00 Xxxxxxxxx Xxxxx Xxxx, Xxxxxxxxx, XX 00000
(hereinafter defined as "Company"), and Merchant Capital, Inc., of 0000 Xxxx
Xxxxxx, Xxxxx 000, Xxx Xxxxx, XX 00000, engaged in providing consulting and
financial public relations services (hereinafter defined as "Consultant").
Witnessth that:
Whereas, the Company requires consulting and financial public relations
services and desires to employ Consultant to provide such services, and
Whereas, the Consultant has advised the Company that the Consultant is
experienced in the field of financial public relations and in complying
with the requirements of the federal and applicable state securities laws
with respect to Consultant's activities in the financial public relations
field.
Whereas, Consultant is agreeable to such engagement, and the parties desire
a written document formalizing their relationship and evidencing the terms
of their agreement.
Now therefore, intending to be legally bound and in consideration of the
mutual promises and covenant, the parties have agreed as follows:
1. Appointment. The Company hereby appoints Consultant as non-exclusive
financial public relations counsel and hereby retains and employs
Consultant under the terms and conditions of this Agreement. Consultant
hereby accepts such engagement under the terms and conditions of this
Agreement,
2. Term. The term of this Agreement shall begin September 1, 1998 and shall
terminate on September 1, 1999 unless sooner terminated as provided herein.
3. Services. Consultant shall act generally as a non-exclusive financial
public relations counsel consulting with and providing the Company with its
opinions and recommendations respecting existing and potential Investment
bankers, market makers, broker-dealers, underwriters and investors.
Consultant shall, from time to time, act as liaison between the Company and
any such person. Consultant shall act as advisor to the Company with
respect to public relations communications and information distribution.
From time to time, as the Company may request, Consultant will engage in
planning, designing, developing, organizing, writing, and distributing such
communications.
A. As the Company may direct, Consultant will assist the Company with
respect to shareholder meetings, media interviews and interviews and
meetings between the Company and financial analysts and other members
of the investment community.
B. Generally, Consultant will seek to make the Company, its management,
products, services and prospects known to potential investment
bankers, market makers, broker-dealers, underwriters and investors,
the financial community and the public. With the assistance of the
Company, consultant will create a research report to be published and
distributed to the financial co mmunity.
C. Company shall promptly provide Consultant with all and complete copies
of all filings with federal and state securities regulators and
agencies, shareholders reports, proxies, sales material, brochures,
and press releases, whether or not Consultant may have assisted in the
preparation of any such written material. Any such correspondence
shall be sent to Merchant Capital, Inc., 000 Xxxxxxx Xxxxxx,
Xxxxxxxxx, XX 00000.
D. Company shall immediately notify Consultant of the Company's intention
of filing of any registration statement for the sale of securities and
of any other event, which may trigger any restriction on publicity.
E. Company shall notify Consultant if any information that has been
provided to Consultant has not been generally released or promulgated.
Company has an affirmative duty to conspicuous xxxx as "Confidential" any
document that may contain proprietary or confidential information. In the
absence of any such conspicuous marking, Consultant shall have no duty hold
from publication any written information supplied to Consultant by the
Company.
5. Representations of Consultant.
(a) The Consultant acknowledges that from time-to-time the Company will
provide it with information which has not been released publicly.
Whether or not marked "Confidential," to the extent the Consultant
understands that certain information regarding the Company has not yet
been made publicly available, the Consultant will keep and maintain
the information confidential and will not disseminate such information
to any person not directly working with the Company pursuant to this
Agreement and who is under a similar obligation of confidentiality.
(b) The Consultant acknowledges that the Company's common stock is trading
in the SmallCap market of The Nasdaq Stock Market, Inc. The Consultant
further acknowledges that the federal and applicable state securities
laws impose liabilities and restrictions on persons to prev ent them
from buying or selling securities while in possession of non-public
information with respect to the issuer of such securities. The
Consultant represents and warrants that it will comply with all federa
and applicable state securities laws, and other applicable laws and
regulations, with respect to any buying or selling of shares of the
Company's common stock, and further represents that it will obtain
similar agreements from its employees and affiliates who may from
time-to-time be in possession of information relating to the Company
which is non-public.
(c) The Consultant represents that neither it, nor any affiliate or
employee, is subject to any cease and desist order, injunction,
restraining order, bar, disgorgement order, or similar order as a
result of any judicial or administrative process brought by or on
behalf of an y federal or state securities administrator or law
enforcement officer, nor are proceedings which may result in any of
the foregoing underway at the current time.
(d) The Consultant further represents with respect to itself and its
affiliates that neither it nor any affiliate or employee, is subject
to:
(1) Any bankruptcy petition filed by or against any business of which
such person was a general partner or executive officer either at the
time of the bankruptcy or within two years prior to that time;
(2) Any conviction in a criminal proceeding or being subject to a
pending criminal proceeding (excluding traffic violations and other
minor offenses);
(3) any order, judgment, or decree, not subsequently reversed,
suspended or vacated, of any court of competent jurisdiction,
permanently or temporarily enjoining, barring, suspending or otherwise
limiting his involvement in any type of business, securities or
banking activities; or
(4) Being found by a court of competent jurisdiction (in a civil
action), the Commission or the Commodity Futures Trading Commission to
have violated a federal or state securities or commodities law, and
the judgment has not been reversed, suspended, or vacated.
(e) The Consultant understands that its activities pursuant to this
Agreement with respect to the Company may subject any offers or
sales it may make of securities of the Company (whether such
securities are received pursuant to this Agreement or otherwise)
to Regulation M of the Rules and Regulations of the Securities
and Exchange Commission under the Securities Exchange Act of
1934, as amended. The Consultant agrees to comply specifically
with Regulation M to the extent such Regulation is applicable to
any activities the Consultant may undertake relating directly or
indirectly to the Company or its securities.
(f) The Consultant acknowledges that only the Company has authority
to release information with respect to the Company, its business,
assets, operations, and financial condition and the Consultant
will not release any such information to any person without the
expres s consent of the Company.
5. Representations of the Company. The Company shall be deemed to make a
continuing representation of the accuracy of any and all material facts,
material information and data, which it supplies to Consultant. The Company
acknowledges its awareness that Consultant will rely in such continuing
representation in disseminating such information and otherwise in
performing its financial public relations functions.
A. Consultant may, in the absence of any contrary writing from the
Company, continue to rely on the accuracy and sufficiency of any
information and data supplied by the Company.
5. Indemnification. Company hereby agrees to indemnify Consultant against, and
to hold Consultant harmless from, any claims, demands. suits, losses,
damages etc. arising out of Consultant's reliance on the information
supplied to Consultant by the Company, unless Consultant has been negligent
in fulfilling its duties hereunder.
(a) The Consultant will indemnify and hold the Company, each of its
affiliates, its directors, each officer of the Company, each person,
if any, who controls the Company within the meaning of the Act, and
each underwriter and its affiliates (collectively the "Indemnified
Party") from and against
(i) any losses, claims, damages or liabilities, joint or several,
to which the Indemnified Party may become subject, under the
Securities Act of 1933, the Securities Exchange Act of 1934, any state
securities law, or otherwise (collectively "Losses")
(ii) insofar as such Losses (or actions in respect thereof): (A)
arise out of or are based upon any actions taken by the Consultant
pursuant to this Agreement or in connection with any offer or sale of
securities of the Company by the Consultant, or (B) arise out of any
untrue statement or alleged untrue statement of any material fact made
in reliance upon and in conformity with information furnished to the
Company by the Consultant or on its behalf which statement is containe
in any registration statement which registers shares of the Company's
common stock for the benefit of the Consultant, any Prospectus
contained therein, or any amendment or supplement thereto, or any
document incident to registration or qualification of such shares
covered thereby under state securities or blue sky laws or (C) arising
out of or based upon any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements contained therein not misleading in light of the
circumstances under which they were made or any violation by the
Consultant of the Act or state securities or blue sky laws applicable
to the Consultant and relating to any action or inaction required by
the Consultant in connection with such registration or qualification
under such state securities or blue sky laws, or (D) any liability
resulting from the failure by the Consultant or any agent to deliver a
Prospectus pursuant to the requirements of the Securities Act of 1933
following the registration of securities of the Company.
(b) Promptly after receipt by an Indemnified Party, under the foregoing
paragraph, of notice of the commencement of any action involving a
claim referred to in such paragraph, such Indemnified Party shall, if
a claim in respect thereof is to be made against the Consultant as the
"Indemnifying Party" under such paragraph, notify the Indemnifying
Party in writing of the commencement thereof. In case any such action
shall be brought against an Indemnified Party and it shall notify the
Indemnifying Party of the commencement thereof, the Indemnifying Party
shall be entitled to participate in and to assume the defense thereof,
with counsel satisfactory to such Indemnified Party and, after notice
from the Indemnifying Party to such Indemnified Party of its election
so to assume the defense thereof, the Indemnifying Party shall not be
liable to such Indemnified Party under such paragraph for any legal or
other expenses; provided, however, that if the defendants in any such
action include both the Indemnified Party and the Indemnifying Party
and the Indemnified Party shall have reasonably concluded that there
may be reasonable defenses available to it which are different from or
additional to those available to the Indemnifying Party or if the
interests of the Indemnified Party reasonably may be deemed to
conflict with the interests of the Indemnifying Party, the Indemnified
Party shall have the right to select a separate counsel and to assume
such legal defenses and otherwise to participate in the defense of
such action with the expenses and fees of such separate counsel and
other expenses related to such participation to be reimbursed by the
Indemnifying Party as incurred.
(c) The respective indemnities, agreements, representations, warranties
and other statements of the Company and the Consultant as set forth in
this Agreement or made by or on behalf of them, respectively, pursuant
to this Agreement shall remain in full force and effect regardless of
any investigation (or any statements as to the results thereof) made
by or on behalf of the Consultant or any officer, or director or
controlling person of the Consultant or the Company.
(a)
5. Compensation. For all consulting and financial public relations services
for the term of this Agreement, Company shall pay Consultant thirty six
thousand shares (36,000) of restricted common stock, carrying piggyback
registration rights, of Medical Dynamics, Inc. (MEDY), payable as f ollows:
(a) Three thousand shares (3,000) payable monthly, beginning September 1,
1998.
Company shall also grant Consultant a total of 300,000 two-year options to
purchase Company restricted common stock, carrying piggyback registration
rights, as follows:
(a) Twenty five thousand shares (25,000) at a purchase price of four
dollars ($4.00) per share of restricted common stock, carrying
piggyback registration rights, of Medical Dynamics, Inc. (MEDY) to be
issued immediately upon execution of this agreement.
(b) Twenty five thousand shares (25,000) at a purchase price of four
dollars and fifty cents ($4.50) per share of restricted common stock,
carrying piggyback registration rights, of Medical Dynamics, Inc.
(MEDY) to be issued immediately upon execution of this agreement.
(c) Twenty five thousand shares (25,000) at a purchase price of five
dollars ($5.00) per share of restricted common stock, carrying
piggyback registration rights, of Medical Dynamics, Inc. (MEDY) to be
issued immediately upon execution of this agreement.
(d) Twenty five thousand shares (25,000) at a purchase price of four
dollars ($4.00) per share of restricted common stock, carrying
piggyback registration rights, of Medical Dynamics, Inc. (MEDY) to be
issued quarterly thereafter beginning January 1, 1999.
(e) Twenty five thousand shares (25,000) at a purchase price of four
dollars and fifty cents ($4.50) per share of restricted common stock,
carrying piggyback registration rights, of Medical Dynamics, Inc.
(MEDY) to be issued quarterly thereafter beginning April 1, 1999.
(f) Twenty five thousand shares (25,000) at a purchase price of five
dollars ($5.00) per share of restricted common stock, carrying
piggyback registration rights, of Medical Dynamics, Inc. (MEDY) to be
issued quarterly thereafter beginning July 1, 1999.
A. The parties acknowledge that in negotiating this fee arrangement that the
services performed and to be by Consultant will probably not be performed
in equal time segments or in accordance with any predefined or rigid
schedule of activities. The lessening of the delivery of servic es by
Consultant shall not constitute a breach of this Agreement or provide any
grounds for its termination.
8. Expenses. MEDY will reimburse the Consultant for expenses incurred, but
only upon presentation of a detailed description of the expenses incurred,
and only to the extent MEDY approves in advance and in writing any
expenditure in excess of $500.
9. Relationship. Consultant, its employees and agents and representatives are
independent contractors and are responsible for the withholding and payment
of any applicable employment related times or unemployment compensation.
This Agreement does not establish and partnership, joint venture or other
business association between the parties and neither party shall have any
interest in the management, business or property of the other party, except
as specifically provided herein.
10. Termination. This Agreement may be terminated by either party, prior to the
expiration of its terms, with thirty (30) days written notification.
11. Attorney's Fees. Should either party default in the terms or conditions of
this Agreement and suit be filed as a result of such default, the
prevailing party shall be entitled to recover the costs of such suit,
including reasonable attorney's fees through trial and appeal.
12. Waiver of Breach. The waiver by a party of a breach of any provision of
this Agreement by the other shall not operate or be construed as a waiver
of any subsequent breach by the other party without regard to the subject
of the breach.
13. Assignment. The rights and obligations of the parties to this Agreement
shall inure to the benefit of; and shall be binding upon the successors and
assigns of the parties provided however, that nothing herein shall obligate
the Consultant to perform any services for any receiver or trustee in
bankruptcy.
14. Notices. Any notice permitted or required shall he sufficient if in writing
and mailed by certified mail, return, receipt requested, to the other party
at its address shown within or provided to the other party as a formal
change of address.
15. Entire Agreeement. This Agreement contains the entire agreement of the
parties, and may be modified only in writing signed by the party against
whom enforcement of any modification shall be sought.
IN WITNESS WIIEREOF, the parties have executed this Agreement on the date first
written above.
Merchant Capital, Inc. Medical Dynamics, Inc.
0000 Xxxx Xxxxxx, Xxxxx 000 00 Xxxxxxxxx Xxxxx Xxxx
Xxx Xxxxx, XX 00000 Xxxxxxxxx, XX 00000
Xxxxxx X. Xxxxx, Xx. - Managing Director Van X. Xxxxxxx - President
