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EXHIBIT 10.5
INDEPENDENT CONTRACTOR AGREEMENT
THIS INDEPENDENT CONTRACTOR AGREEMENT, made effective as of the 3 day
of September, 1997 by and between C3, INC., a North Carolina corporation (the
"Company"), and C. Eric Hunter (the "Contractor").
RECITALS:
A. The Company is engaged in the business of designing, developing,
manufacturing and selling moissanite gemstones (the "Business") and desires to
engage the Contractor to assist the Company in providing consulting services
related to intellectual property of patents filed for the business (the
"Services").
B. The Contractor desires to provide such services to the Company on
the terms and for the compensation set forth herein.
NOW, THEREFORE, the parties hereto agree as follows:
1. ENGAGEMENT. The Company hereby engages the Contractor as a
nonexclusive contractor to perform the Services subject to the terms and
conditions of this Agreement, and the Contractor hereby accepts such engagement
for and in consideration of the compensation hereinafter provided and agrees to
use his best efforts in performing the Services. The Contractor shall perform
his obligations hereunder in compliance with the terms of this Agreement and any
and all applicable laws and regulations. The Contractor acknowledges that this
is a nonexclusive engagement by the Company and that the Company retains the
right to appoint additional contractors as the Company, in its sole and
unrestricted judgment, may from time to time determine to be in the best
interests of the Company without liability or obligation to the Contractor.
2. SERVICES.
(a) The Contractor agrees to provide the Services The Contractor
warrants to the Company that the Services will be performed in a
professional, timely and workmanlike manner.
(b) The Contractor shall execute a Nondisclosure and Noncompetition
Agreement in substantially the form attached hereto as Exhibit A
concurrent with the execution of this Agreement.
3. LICENSES; TOOLS AND MATERIALS. The Contractor shall be responsible
for obtaining, at the Contractor's own expense, all licenses, permits and bonds
as may be required by any federal, state or local law or regulation for the
performance of the Contractor's duties hereunder. The Company shall be
responsible for supplying at its cost all necessary tools and materials to be
used by the Contractor.
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4. LIMITATIONS. Nothing in this Agreement shall be construed to give
the Contractor authority to represent the Company before any court or
governmental or regulatory agency without the express prior written
authorization of the Company. In addition, all files, books, accounts, records
and other information of any nature, however recorded or stored, and related to
the Company (the "Records") shall at all times belong to the Company and to the
extent possessed by the Contractor hereunder, such possession shall be for the
benefit of and as agent for the Company. The Contractor's possession of the
Records is at the will of the Company and is solely for the purpose of enabling
the Contractor to perform his obligations hereunder. The Records shall be
readily separable from the records of the Contractor.
5. TERM. The terms of this Agreement shall commence on the date hereof
and shall continue thereafter through and including the close of business on
September 3, 1999. Notwithstanding the foregoing, the Company may terminate this
Agreement for "cause," as defined herein, by giving written notice of at least
30 days in advance of its desire to terminate this Agreement for cause. The
Company shall be deemed to have cause for terminating the Contractor's
engagement in the event the Contractor (i) demonstrates any dishonesty or
engages in any act of moral turpitude, (ii) improperly performs or fails to
perform the Services described herein, (iii) causes intentional damage to
substantial property of the Company, or (iv) is unable to perform the Services
because of death or a disability which renders him unable to perform the
Services for 30 consecutive calendar days.
6. FEES. As compensation for the performance of the Services, the
Company shall pay to the Contractor $1,800 per month. No amounts (including,
without limitation, social security, federal and state withholding taxes) shall
be withheld or otherwise subtracted from the compensation paid to the Contractor
pursuant to this Section 6 unless required by law. In addition, the Contractor
shall be reimbursed for all expenses incurred by the Contractor on behalf (and
with the prior written authorization) of the Company within 15 days from the
date the Contractor delivers an itemized report of such expenses, together with
receipts or other evidence of payment reasonably satisfactory to the Company and
its accountant.
7. INDEMNIFICATION. The Company shall defend, release, indemnify and
hold the Consultant harmless from and against any and all claims, suits,
liability, costs and expenses, including, without limitation, attorneys' fees
and expenses, arising out of the provision of any Services or work by the
Consultant; provided the Company is given prompt written notice of such claims
and control of the defense and settlement negotiations.
8. INSURANCE REPRESENTATIONS; WORKPLACE SAFETY. The Contractor agrees
to maintain liability, worker's compensation, errors and omission and/or other
insurance in such amounts and with such carriers as the Company may reasonably
request, each of which policies shall, upon request of the Company, name the
Company as an additional insured. In addition, the Contractor shall be solely
responsible for workplace safety, shall maintain the workplace in accordance
with industry standards and shall comply with all governmental (including
federal, state and local) regulations.
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9. NOTICES. All notices, demands, requests or other communications
which may be or are required to be given, served or sent by one party to the
other party pursuant to this Agreement shall be in writing and shall be hand
delivered or mailed by certified mail, return receipt requested, postage
prepaid, or sent by telefax, addressed as follows:
If to the Company:
P.O. Box 13533
Research Triangle Park, North Carolina 27709-3533
Attention: Jeff Hunter, President
Telecopy: (919) 468-0486
If to the Contractor:
_________________________________
_________________________________
_________________________________
Each party may designate by notice in writing a new address to
which any notice, demand, request or communication may, thereafter be delivered,
given or sent. Documents delivered by hand shall be deemed to have been received
upon delivery; documents sent by telefax shall be deemed to have been received
when the answer back is received; and documents sent by mail shall be deemed to
have been received upon their receipt, or at such time ~ delivery is refused by
the addressee upon presentation.
10.SECURITY. The Contractor agrees that he will at all times comply
with all security regulations in effect from time to time at the Company's
premises or applicable outside such premises to materials belonging to the
Company. The Contractor agrees not to use or disclose to any party any
information, systems, equipment, ideas, processor or methods of operation
observed in connection with the performance of his obligations hereunder.
11.INDEPENDENT CONTRACTOR.
(a) Acknowledgment by the Contractor. The Contractor
acknowledges and agrees that the Contractor will be treated, vis-a-vis
the Company, as an independent contractor and not as an employee, agent
or authorized representative of the Company. The Contractor shall have
no authority to bind the Company to any contract, agreement or
obligation whatsoever. The acts of the Contractor shall in no way
constitute the acts of the Company, and the Contractor shall not
represent to any third party that the Contractor has any express or
implied authority to bind the Company to any such contract, agreement
or obligation.
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(b) Tax Matters. Because the Contractor is an independent
contractor, the Company will not withhold from any compensation paid to
the Contractor any amounts for federal or state income taxes, or social
security (FICA) for the Contractor, nor will the Company pay any social
security or unemployment tax with respect to the Contractor. Such taxes
are the responsibility of the Contractor. The Contractor agrees to
indemnify and hold the Company (including its employees, officers,
directors, agents, subsidiaries or affiliates) harmless, and hereby
indemnifies and holds the Company harmless, from and against any
damage, claim, assessment, interest charge or penalty incurred by or
charged to the Company as a result of any claim, cause of action or
assessment by any federal or state government or agency for any
nonpayment or late payment by the Contractor of any tax or contribution
based upon compensation paid hereunder or because the Company did not
withhold any taxes from compensation paid hereunder.
(c) No Insurance. Consistent with the Contractor's status as
an independent contractor, the Company will not provide the Contractor
with any company, individual or group insurance policy or any other
kind of insurance coverage whatsoever.
12. ASSIGNMENT. Neither this Agreement or any interest herein or
any rights hereunder shall be sold or assigned by the Contractor, nor shall any
of the duties of the Contractor hereunder be delegated to any person, firm or
corporation, without prior notice to and consent of the Company.
13. INTELLECTUAL PROPERTY. Any inventions, copyrights or other
intellectual property created or developed by the Contractor or the Contractor's
employees, or associates or pr subcontractors during the term of this Agreement
related to the work performed under the Agreement shall be assigned to the
Company.
14. STANDARD OF CARE. The Contractor warrants that he will
exercise due diligence to perform the Services in a professional manor in
compliance with all applicable laws and regulations and the highest ethical
standards. In addition, the Contractor represents and warrants that any
information which he may supply the Company during the term of this Agreement
(i) will have been obtained by the Contractor lawfully and from publicly
available sources and (ii) will not be confidential or proprietary to any third
person. Nothing in this Agreement shall be construed as authorizing or
encouraging the Contractor to obtain information for the Company in violation of
any third party's rights to copyright or trade secret protection.
15. MISCELLANEOUS.
(a) The provisions of this Agreement may be waived, altered,
amended or repealed, in whole or in part, only on the written consent
of the Company and the Contractor.
(b) Section headings and numbers used in this Agreement are
included for convenience of reference only, and if there is any
conflict between any such numbers and headings and the text of this
Agreement, the text shall control. Each of the statements set
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forth in the premises of this Agreement is incorporated into the
Agreement as a valid and binding representation of the party or parties
to whom it relates.
(c) This Agreement shall be governed by and construed in
accordance with the laws of the State of North Carolina without
reference to the choice of law principles thereof If any dispute arises
hereunder, the parties hereto agree that any suit brought by either
party shall be heard in the courts of North Carolina or any federal
court sitting in North Carolina, and the parties hereto consent to the
jurisdiction of such courts.
(d) This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
(e) This Agreement, together with the Nondisclosure and
Noncompetition Agreement herein referenced represent the entire
agreement of the parties with respect to the subject matter hereof and
supersede in their entirety any and all prior written or oral
agreements with respect thereto.
(f) Neither party shall have the right under this Agreement to
use the name, trademark or trade names of the other unless prior
written approval has been obtained. Any such approval or authorization
shall cease upon termination of this Agreement.
IN WITNESS WHEREOF, the duly authorized representations of the parties
have executed this Independent Contractor Agreement as of the date and year
first above written
COMPANY
C3, Inc.
By: /s/ Jeff N. Hunter
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Jeff N. Hunter, President
CONTRACTOR
/s/ C. Eric Hunter
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C. Eric Hunter
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