Exhibit 10.5
[NCT Group, Inc. logo]
Michael J. Parrella
Chairman & Chief Executive Officer
Telephone 203-226-4447, ext. 3510
E-mail nonoise@aol.com
January 7, 2005
Mr. Morton Salkind
195 Greenpond Road
Rockaway, NJ 07866
Re: Consulting Agreement
Dear Mr. Salkind:
This will confirm the arrangements, terms and conditions pursuant to which
Morton Salkind ("Consultant"), has been retained to serve as management
consultant and advisor to NCT Group, Inc. (the "Company") for the term described
below. The undersigned hereby agree to the following terms and conditions:
1. Duties of Consultant: During the term of this Agreement, consultants shall
provide the company with such regular and customary
consulting advice as is reasonably requested by the Company,
provided that Consultant shall not be required to undertake
duties not reasonably within the scope of the financial and
consulting advisory services contemplated by this Agreement.
It is understood and acknowledged by the parties that the
value of Consultant's advice is not readily quantifiable,
and that Consultant shall be obligated to render advice upon
request of the Company, in good faith, but shall not be
obligated to spend any specific amount of time in so doing.
Consultant's duties may include, but will not necessarily be
limited to, providing recommendations concerning the
following financial and related matters:
(a) Disseminating information about the Company to the
investment community at large;
(b) Rendering advice and assistance in connection with the
preparation of annual and interim reports and press
releases;
(c) Assisting in the Company's financial public relations;
(d) Arranging, on behalf of the Company, at appropriate
times, meetings with securities analysts of major
regional investment banking firms;
(e) Rendering advice with regard to internal operations,
including:
(1) The formation of corporate goals and their
implementation;
(2) The Company's financial structure and its divisions or
subsidiaries;
(3) Securing, when and if necessary and possible,
additional financing through banks and/or insurance
companies; and
(4) Corporate organization and personnel; and
(f) Rendering advice with regard to any of the following
corporate finance matters:
(1) Changes in the capitalization of the Company;
(2) Changes in the Company's corporate structure;
(3) Redistribution of shareholdings of the Company's
stock;
(4) Offerings of securities in public transactions;
(5) Sales of securities in private transactions;
(6) Alternative uses of corporate assets;
(7) Structure and use of debt; and
(8) Sales of stock by insiders pursuant to Rule 144
or otherwise.
In addition to the foregoing, Consultant agrees to furnish
advice to the Company in connection with (x) the acquisition
and/or merger of or with other companies, divestiture or any
other similar transaction, or the sale of the Company itself
(or any significant percentage, assets. subsidiaries or
affiliates thereof), and (y) financings, including private
financing and financing from financial institutions
(including but not limited to lines of credit, performance
bonds, letters of credit, loans or other financings).
Consultant shall render such other financial advisory and
consulting services as may from time to time be agreed upon
by Consultant and the Company.
2. Term of Agreement: The effective date of this Agreement is the date hereof.
The term of this Agreement extends through January 7, 2008.
3. Available Time: Consultant shall make available such time as he, in his sole
discretion, shall deem appropriate for the performance of
his obligations under this Agreement and may in certain
circumstances be entitled to additional compensation in
connection therewith.
2
4. Compensation: As compensation for Consultant's services hereunder, the
Company shall pay to Consultant the following:
(a) A monthly retainer of $5,000 commencing on the date of
this Agreement and payable at the end of the term
hereof.
(b) The use of one 2005 Cadillac STS-V8 four-door
automobile, which automobile shall be owned or leased
by the Company and shall be under Cadillac warranty.
The Company shall maintain insurance coverage on such
automobile with coverage amounts no lower than those
for other automobiles the Company owns or leases.
(c) A cash performance bonus for extra services may be
issued to Consultant by Company at the Company's
discretion.
5. Expenses: The Company agrees to reimburse Consultant for reasonable
out-of-pocket expenses related to performing services on
behalf of the Company. Such expenses typically might
include, but are not limited to, phone calls, postage,
shipping, messengers, travel, meals and lodging expenses.
All travel will be pre-approved by the Company.
6. Health Care: The Company agrees to provide health coverage at no cost to
Consultant and his family.
7. Communications: The Company agrees to set up a private line for
communications between Consultant and Michael J. Parrella.
8. Relationship: Nothing herein shall constitute Consultant as an employee or
agent of the Company, except to such extent as might herein
be expressly agreed for a particular purpose. Consultant
shall not have the authority to obligate or commit the
Company in any manner whatsoever.
9. Information: The Company acknowledges that Consultant will rely on
information furnished by the Company concerning the
Company's business affairs without independent certification
and represents that such information will be materially
complete and correct.
10. Confidentiality: Except in the course of the performance of his duties
hereunder, Consultant agree that he shall not disclose any
trade secrets, know-how, or other proprietary information
not in the public domain learned as a result of this
Agreement unless and until such information becomes
generally known.
3
11. Indemnification: The Company agrees to indemnify and hold harmless
Consultant, his partners, affiliates, employees and each
person who controls any of his partners or affiliates from
and against any losses, claims, damages, liabilities and
expenses whatsoever (including reasonable costs of
investigation or defending any action) to which they or any
of them may become subject under any applicable law arising
out of Consultant's performance under this Agreement and
will reimburse Consultant for all expenses related thereto
(including counsel fees) as they are incurred.
12. Assignment: This Agreement shall not be assignable by either party.
13. Entire Agreement: This Agreement supersedes any and all prior and
contemporaneous written or oral agreements and
understandings between the parties hereto with respect to
the subject matter hereof.
14. Governing Law: This Agreement shall be deemed to be a contract made under
the laws of the State of Connecticut and for all purposes
shall be construed in accordance with the laws of said
State.
15. Notices: All notices under this Agreement will be delivered by hand
or sent via certified mail or recognized commercial courier
such as Federal Express or UPS, to Mr. Morton Salkind, 195
Greenpond Road, Rockaway, NJ 07866 and NCT Group, Inc., 20
Ketchum Street, Westport, CT 06880, Attention: Michael J.
Parrella.
Very truly yours,
/s/ Michael J. Parrella
----------------------------------
Michael J. Parrella
Chairman & Chief Executive Officer
NCT Group, Inc.
AGREED & ACCEPTED:
- -----------------
/s/ Motron Salkind
- --------------------
MORTON SALKIND
4