Exhibit 4.1
INDEPENDENT CONTRACTOR AGREEMENT
XXXXX X. XXXXXX
(THE EMCO/HANOVER GROUP,INC.)
This Independent Contractor Agreement ("Agreement") is entered into
this 4th day of February, by and between SYS, a California corporation
(hereinafter "SYS and/or the Corporation"), and Xxxxx X. Xxxxxx (The
EMCO/Hanover Group, INC., (hereinafter referred to as "Contractor"), as an
independent contractor, for the purpose of providing management and other
consulting services to the corporation.
1. RECITAL
This Agreement is entered into in contemplation of the following
facts, circumstances and representation:
1.1 The parties desire to enter into an agreement whereby
Contractor shall provide financial advisory services with regard to certain
matters relating to executive management and strategic planning. Contractor
will assist SYS in analyzing both domestic and international business
opportunities (i.e. Canada and Britain), provide merger and acquisition
advice, investor relations contacts, marketing services and such other
matters as required.
1.2 Contractor agrees to the terms and condition as more
specifically set forth herein.
1.3 Contractor has represented to the Corporation and Contractor
is knowledgeable and capable of providing the requested support to SYS.
1.4 As a condition of entering into this Agreement, the Contractor
agrees to assign all rights to any intellectual property developed by the
Contractor for any SYS projects while working under the terms of this
Agreement to SYS.
Now, therefore, the parties hereto agree as follows:
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2. PRICE AND PAYMENT
2.1 Price: Terms of Payment. SYS shall owe to Contractor
fifty thousand shares (50,000) of the Corporation's common stock upon
execution of this agreement. Such shares shall delivered to Finder within 30
days following execution of this Agreement in addition, upon the completion
of an acquisition by SYS, debt or equity infusion into the Company, or the
sale of a controlling interest in the Corporation, subject to the exclusions
listed on Exhibit A, the Corporation will issue 100,000 shares of Common to
Contractor. In no event will shares issued to Contractor exceed one hundred
and fifty thousand shares in the aggregate. Any shares of Common Stock issued
to Contractor shall be freely tradable non-assessable common stock of SYS,
and registered on Form S-8. the Corporation shall have a right of first
refusal to repurchase any shares to Contractors. As part of this Agreement
both parties acknowledge that Finder was introduced to SYS by Xx. Xxxxx X.
Xxxxxxx of Centex Securities, Inc. Finder hereby agrees that shares of common
stock due to Xx. Xxxxx X. Xxxxxxx and/or Centex Securities, Inc. as a result
of this introduction will be the responsibility of Finder.
2.2 Expenses: Contractor will be reimbursed for all pre-approved
expenses incurred as a direct result of Contractor's work which are supported
by appropriate receipts and documentation. Upon execution of this Agreement,
SYS will advance to Contractor the sum of $10,000 to cover out of pocket
expenses concerning a planned trip on February 7, 1999 to Canada (estimated
at $3,000), plus two other trips planned for New York (estimated at $3,500
each). Any unused portion of expense advances will be returned to SYS.
3. TERM AND TERMINATION
3.1 This Agreement shall become effective as of the date first
written above and continue in effect for a period of six months or unless
terminated in accordance with Paragraph 3.2 hereunder.
3.2 Either party may terminate this agreement upon giving 30 days
written notice to the other party.
3.3 Upon termination hereof, Contractor shall return any and all
data, manuals, documents, magnetic tapes, computer disc or other medium of
information relating to the technology, services and/or products of SYS>
3.4 The term of this Agreement may be extended by mutual agreement
of the parties as expressed in writing.
4. EVENTS OF DEFAULT AND REMEDIES: CANCELLATION
4.1 Events of Default (terminating for Cause). It shall be an
event of default if either party hereto shall:
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4.1.1 fail or refuse to comply with any other term, provision
or covenant contained herein other than a default described in subsection
4.1.2 below and such failure shall not be cured within 5 days after written
notice thereof to the defaulting party; or
4.1.2 (i) make an assignment for the benefit of creditors;
(ii) file a petition under any law or statute of the United States or any
state thereof relating to bankruptcy or insolvency or be adjudged bankrupt or
insolvent in proceedings filed against it under any such law; or (iii) suffer
the appointment of a receiver or trustee for all or substantially all of its
assets.
4.2 Remedies Upon Default. Upon a Default, the party nor in
default shall have, in addition to any and all other rights or remedies
available to it at law or in equity, the right to terminate this Agreement
within five days by giving written notice thereof to the party in default.
4.3 Cancellation (Termination With Cause). Notwithstanding
anything in this Agreement to the contrary, SYS may terminate this Agreement
any time with cause upon written notification thereof to Contractor, which
termination shall be effective upon receipt thereof; provided, however, that
SYS shall be liable for costs incurred by Contractor up to the date of
notice, subject to Section 2.2.
5. GENERAL TERMS
5.1 Cooperation of Parties: The parties further agree that they
will do all that is required and necessary to accomplish and facilitate the
purposes of this Agreement and that they will sign and execute any and all
documents necessary to bring about and perfect the purposes of this Agreement.
5.2 Interpretations of Agreement: The parties hereto agree that
should any provision of this Agreement be found to be ambiguous in any way,
such ambiguity shall not be resolved by construing such provisions or any
part of or the entire Agreement in favor of or against any party herein, but
rather by construing the terms of this Agreement fairly and reasonably in
accordance with their generally accepted meaning.
5.3 No Presumption Against Drafting Party: This Agreement and the
provisions contained herein shall not be construed or interpreted for or
against any party hereto because said party drafted or caused the party's
legal representative to draft any of its provisions.
5.4 Amendments Modifications and Waivers: No amendment,
modification or waiver of any provision of this Agreement shall in any event
be effective unless the same shall be in writing and signed by the parties
hereto. No failure or delay on the part of any party in exercising any
power, right privilege or remedy under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right,
power or remedy constitute a waiver of any other or further exercise of any
right, power or remedy. Any waiver of any provision of this Agreement, and
any consent to any departure by any of the parties form the terms of any
provision of this Agreement, shall be effective only in the specific instance
and for the specific purpose for which given.
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5.5 Severability of Provisions: This Agreement shall be performed
and shall be enforceable to the full extent allowable by applicable law. In
the event that any provision to this Agreement is declared by a court of
competent jurisdiction to be illegal, invalid, or unenforceable that
provision will be severed from the Agreement and the Agreement shall be read
as if it did not contain said provision. Any such provision and its
severance shall not affect the legality, validity, applicability,
enforceability or effect of the remaining provisions of this Agreement.
5.6 Assignments: None of the parties rights, duties or
obligations under this Agreement are assignable by any of the parties hereto
without the prior written consent of the other party and any attempted
assignment without prior written consent shall be null and void.
5.7 Entire Agreement: This Agreement constitutes the entire
Agreement and understanding of the parties hereto with respect to the matters
herein set forth, and all prior negotiating, writings and understandings
relating to the subject matter of this Agreement are merged herein and are
superseded and canceled by this Agreement. In executing this Agreement, the
parties have not and do not rely on any statements, inducements, promises, or
representations made by the other party or their agents, representatives or
attorneys with regard to the subject matter, basis, or effect of this
Agreement, except for those specifically set forth in this Agreement. The
parties acknowledge that the terms of this Agreement are contractual and not
a mere recital. Each party hereto further certifies that it is fully
familiar with the provisions of this Agreement.
5.8 Successors: This Agreement shall be binding upon and shall
inure to the benefit of the respective parties thereto, their legal
successors, parent corporations, subsidiaries, assigns, and legal
representatives.
5.9 Choice of Law: The validity and interpretation of t his
Agreement and each clause and part thereof shall be governed by, and
construed in accordance with, the laws and regulations then prevailing in the
State of California.
5.10 Arbitration. Legal Proceedings and Venue: The parties will
attempt through good faith negotiation to resolve their disputes. The term
"disputes" includes, without limitation, any disagreements between the
parties concerning the existence, formation and interpretation of this
Agreement and their obligation thereunder. If the parties hereto are unable
to resolve their disputes by negotiation, they shall attempt to resolve their
disputes through mediation. If mediation proves unsuccessful, either party
may commence arbitration by sending a written notice of arbitration to the
other party. The notice will state the dispute with particularity. As part
of the arbitrators decision, the arbitrator may allocate the cost of
arbitration, including fees of attorneys and experts, as the arbitrator deems
fair and equitable in light of all relevant circumstances. The arbitration
hearing shall be commenced thirty (30) days following the date of delivery of
notice of arbitration to the other party, or as soon thereafter as set by the
arbitrator(s).
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If the parties reasonably believe that the amount in controversy will be less
than Thirty Thousand Dollars ($30,000), such arbitration will be conducted in
San Diego, California by an arbitrator selected by the parties, in accordance
with the Commercial Arbitration Rules of the American Arbitration Association
then in effect. If the amount in controversy will likely exceed Thirty
Thousand Dollars ($30,000), such arbitration shall be conducted by the
Judicial Arbitration and Mediation Services, Inc. ("JAMS") as arbitrator in
San Diego, California in accordance with the rules promulgated by JAMS (with
the widest rights of discovery as provided in the California Code of Civil
Procedure). In this regard, each party shall retain the right to
cross-examine the opposing party's witnesses, either through legal counsel,
expert witnesses or both. The decision of the arbitrator(s) shall be final,
binding and conclusive on all parties (without any right to appeal therefrom)
and shall not be subject to judicial review (except for abuse of the
arbitrator's discretion).
If the parties reasonably believe that the amount in controversy will
exceed One Million Dollars ($1,000,000), then the parties are not bound to
arbitrate the dispute and may commence an action in Superior Court in the
County of San Diego, or in XX Xxxxxxxx Xxxxx, Xxxxxxxx Xxxxxxxx of California.
5.11 Attorney Fees: If any legal actin or any arbitration or
other proceeding is brought for the enforcement of this Agreement, or because
of an alleged dispute, breach, default or misrepresentation in connection
with any of the provisions of the Agreement, the successful or prevailing
party shall be entitled to recover reasonable attorney's fees and other costs
incurred in that action or proceeding, in addition to any other relief to
which it may be entitled.
5.12 Remedies Cumulative: Except as otherwise expressly set forth
in this Agreement, the rights and remedies herein provided are cumulative and
are not exclusive of any rights or remedies that any party may otherwise have
at law or in equity.
5.13 Notices. Whenever any party desires or is required to give
any notice, demand, or request to this Agreement, each such communication
shall be in writing and shall be effective only if it is delivered by
overnight messenger services, express or electronic means (with confirmed
receipt), addressed as follows.
SYS:
W. Xxxxxx Xxxxxx
0000 Xxxxxxxxxx Xxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Contractor:
Xxxxx X. Xxxxxx
The EMCO/Hanover Group, Inc.
00000 Xxxxxx Xxxx.
Xxx Xxxxxxx, XX 00000-0000
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Such communications shall be effective when received by the addressee.
Any party may change its address for such communications by giving an
appropriate notice to the other party in conformity with this Section.
5.14 No Joint Venture: Nothing contained in this Agreement shall
be deemed or construed as creating a joint venture or partnership between the
parties. Except as expressly set forth, no party by virtue of this Agreement
is authorized as an agent, contractor, or legal representative of any other
party, and the relationship of the parties is, and at all times will continue
to be, that of an independent contractor.
5.15 Heading: The provision headings in this Agreement are for
reference and convenience only. They do not form a part hereof, and do not
in any way codify, interpret, or reflect the intent of the parties. Said
headings shall not be used to construe or interpret any provision of this
Agreement.
5.16 Gender and Number: In this Agreement where the context so
requires, the masculine, feminine or neuter gender shall be deemed to include
each other, and the singular to include the plural.
5.17 Counterparts: This Agreement may be signed in one or more
counterparts.
5.18 Facsimile Transmission Signature: A signature received
pursuant to a facsimile transmission shall be sufficient to bind a party to
this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first indicated below and this Agreement is effective as of
day and date noted below.
SYS: CONTRACTOR:
BY: BY:
/s/ W. Xxxxxx Xxxxxx /s/ Xxxxx X. Xxxxxx
Chief Executive Officer The EMCEE/Hangover Group, Inc.
Date: 02/04/99 Date: 02/04/99
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EXHIBIT A
SUMMARY OF EXCLUSIONS
Xxxxx Xxxxx Xxxx Xxxxxxxxxx
Pacific Summit Capital The Titon Group, Inc.
0000 Xxxxxxxxxx Xxxxx, Xxxxx 000 0000 Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000 Xxx Xxxxxxxxx, XX 00000
Xxxxx Xxxxxxxx Systems Integration and Research, Inc.
Granite Financial Group, Inc. West Coast Solutions
L.F.L. Global Investments, LLC Quarterdeck Investment Partners, Inc.
Xxxxxx Xxxxx Venturian Corp.
The Zures Companies
Xxxx Xxxxxxxx Xxxxxxxx, Xxxxx Xxxxxx & Xxxxx
Xxxxxx Associates
Parkside Group SYS Board of Directors
AMSEC (SAIC)
Xxxx Xxxxxxx
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