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EXHIBIT 10.5
INDEPENDENT SALES REPRESENTATIVE AGREEMENT
BY AND BETWEEN
MAXXIS GROUP, INC.
AND
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DATED: , 199___
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TABLE OF CONTENTS
PAGE
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1 Engagement ............................................................1
2 Term ..................................................................1
3 Payment ...............................................................1
4 Relationship of Parties ...............................................1
5 Covenants .............................................................2
6 Termination ...........................................................3
7 Trade Secrets, Confidential Business Information and Related Matters ..3
8 Successors; Binding Agreement .........................................5
9 Notice ................................................................5
10 Settlement of Claims ..................................................5
11 Modification and Waiver ...............................................5
12 Governing Law .........................................................5
13 Severability ..........................................................5
14 Entire Agreement ......................................................6
15 Headings ..............................................................6
16 Counterparts ..........................................................6
17 Definitions ...........................................................6
EXHIBIT A DUTIES OF INDEPENDENT SALES REPRESENTATIVE
EXHIBIT B BONUS AMOUNT
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INDEPENDENT SALES REPRESENTATIVE AGREEMENT
This INDEPENDENT SALES REPRESENTATIVE AGREEMENT (this
"Agreement") is made by and between MAXXIS GROUP, INC., a Georgia corporation
(the "Company"), and _______________________, an individual resident of the
State of ______________ (the "Representative"), as of this day of
_______________, 199____.
The Company desires to engage the Representative as an
independent sales representative, and the Representative is willing to be
engaged by the Company in such capacity on the terms and conditions herein
provided. Certain terms used in this Agreement are defined in Section 17 hereof.
In consideration of the foregoing, the mutual covenants
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, hereby agree as follows:
1. Engagement. The Company shall engage the Representative,
and the Representative agrees to be engaged by the Company, as an independent
sales representative of the Company upon the terms and conditions set forth
herein. The Representative shall have such duties and responsibilities
("Duties") as are set forth on Exhibit A hereto. The Representative shall devote
such portion of his business time (up to and including his full business time)
and such attention, skill and efforts to the performance of his Duties hereunder
as are necessary to competently and professionally perform and discharge such
Duties.
2. Term. Unless earlier terminated as provided herein, the
Representative's engagement under this Agreement shall be for a continuing term
(the "Term") of one year, which shall be extended automatically (without further
action of the Company or the Representative) each day for an additional day so
that the remaining term shall continue to be one year; provided, however, that
either party may at any time, by written notice to the other, fix the Term to a
finite term of one year, without further automatic extension, commencing with
the date of such notice.
3. Payment.
a. Effective July 1, 1997, the Company shall pay the
Representative a fee of $800.00 per week, subject to increase upon the mutual
written agreement of the Company (following specific approval of such increase
by the Company's Board of Directors) and the Representative.
b. The Representative shall be eligible to receive quarterly
payments of a performance bonus based upon achievement of targeted levels of
performance set forth in Exhibit B hereto.
4. Relationship of Parties. The Representative shall at all
times be and act as an independent contractor, and the Company shall exercise no
control over the activities and
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operations of the Representative other than as set forth herein. The
Representatives's Federal Tax I.D. number is ____________. This Agreement shall
not be deemed to create any agency, employment, partnership or joint venture
relationship between the Company and the Representative, and the Representative
shall enjoy no fringe benefits accorded to employees of the Company. Neither
party hereto shall have the power of authority to (and agrees not to attempt to)
bind, commit or obligate the other in any manner whatsoever without the other's
prior written consent, or to use the other party's name in any way not
specifically authorized by this Agreement. No representations of either party
shall be binding upon the other party without the other party's prior written
consent.
5. Covenants. The Representative covenants and agrees, in
addition to the other duties and obligations of the Representative set forth in
the Agreement, that the Representative will:
a. bear all costs, expenses and liability relating to his
business and operations, including, but not limited to, the costs and expenses
of providing and maintaining his place of business, the wages and salaries of
his employees, if any, and expenses incurred for or in connection with his
performance under this Agreement;
b. not use any trademarks or tradenames of the Company in any
manner except with the prior written authorization of the Company;
c. maintain within limits specified by the Company (or, in the
absence of any specification by the Company, reasonable and adequate limits)
workers compensation and liability insurance (other than products liability
insurance) in connection with his operations, and to furnish the Company with a
certificate evidencing the required insurance immediately upon the Company's
request;
d. immediately give the Company written notice of any offers,
whether oral or written, received by him, or his agents or employees, during the
term of this Agreement which, if accepted, would place the Representative in
violation of his covenants or agreements hereunder;
e. give the Company notice of any person, firm or entity who
is infringing upon the trademarks, tradenames or other intellectual property of
the Company immediately upon the Representative's receipt of notice thereof;
f. hold harmless, defend and indemnify the Company and its
officers, directors, employees and agents from and against any and all claims,
damages, losses, injuries, causes of action, demands and expenses, including
reasonable legal fees and expenses, of whatever kind and nature directly or
indirectly arising out of, on account of or resulting from the Representative's
activities or out of the Representative's failure to comply with his obligations
under this Agreement; and
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g. comply strictly with all rules, regulations, policies and
procedures of the Company as such rules apply to independent contractors and may
be established by the Company from time to time.
6. Termination.
a. The Representative's engagement under this Agreement may be
terminated prior to the end of the Term only as follows:
(i) upon the death of the Representative;
(ii) by the Company due to the Disability of the
Representative upon delivery of a Notice of Termination to the
Representative;
(iii) by the Company for Cause upon delivery of a Notice of
Termination to the Representative; and
(iv) by the Company without Cause upon delivery of a
Notice of Termination to the Representative.
b. If the Representative's engagement with the Company shall
be terminated during the Term (i) by reason of the Representative's death or
(ii) by the Company for Disability or Cause, the Company shall pay to the
Representative (or in the case of his death, the Representative's estate) within
15 days after the Termination Date, a lump sum cash payment equal to the Accrued
Fees and, if such termination is other than by the Company for Cause, any
accrued performance bonus.
c. In the event that the Representative is a director of the
Company or any of its affiliates and his engagement hereunder is terminated for
any reason, the Representative shall, and does hereby, tender his resignation as
a director of the Company and any of its affiliates effective as of the
Termination Date.
7. Trade Secrets, Confidential Business Information and
Related Matters.
a. The Representative shall not, at any time, either during
the Term of his engagement or after the Termination Date, use or disclose any
Trade Secrets of the Company, except in fulfillment of his duties as the
Representative during his engagement, for so long as the pertinent information
or data remain Trade Secrets, whether or not the Trade Secrets are in written or
tangible form.
b. The Representative agrees to maintain in strict confidence
and, except as necessary to perform his duties for the Company, not to use or
disclose any Confidential Business Information during his engagement and for a
period of 24 months after the Termination Date.
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c. Upon termination of the engagement provided for herein, the
Representative shall deliver to the Company, at the Representative's expense,
all business records relating to the Company and its affiliates including,
without limitation, all contracts, calendars and other materials relating to the
business records, the Company's business or its customers, including all
physical, electronic and computer copies thereof, whether or not the
Representative prepared such materials or records himself. Upon such
termination, the Representative shall retain no copies of any such materials.
d. The Representative may disclose Trade Secrets or
Confidential Business Information pursuant to any order or legal process
requiring him (in his legal counsel's reasonable opinion) to do so; provided,
however, that the Representative shall first have notified the Company of the
request or order to so disclose the Trade Secrets or Confidential Business
Information in sufficient time to allow the Company to seek an appropriate
protective order.
e. The Representative acknowledges and agrees that great loss
and irreparable damage would be suffered by the Company if the Representative
should breach or violate any of the terms or provisions of the covenants and
agreements set forth in this Section 7. The Representative further acknowledges
and agrees that each of these covenants and agreements is reasonably necessary
to protect and preserve the interests of the Company. The parties agree that
money damages for any breach of clauses (a) through (d) of this Section 7 will
be insufficient to compensate for any breaches thereof, and that the
Representative or any of the Representative's affiliates, as the case may be,
will, to the extent permitted by law, waive in any proceeding initiated to
enforce such provisions any claim or defense that an adequate remedy at law
exists. The existence of any claim, demand, action or cause of action against
the Company, whether predicated upon this Agreement or otherwise, shall not
constitute a defense to the enforcement by the Company of any of the covenants
or agreements in this Agreement; provided, however, that nothing in this
Agreement shall be deemed to deny the Representative the right to defend against
this enforcement on the basis that the Company has no right to its enforcement
under the terms of this Agreement.
f. The Representative acknowledges and agrees that: (i) the
covenants and agreements contained in clauses (a) through (d) of this Section 7
are the essence of this Agreement; (ii) that the Representative has received
good, adequate and valuable consideration for each of these covenants; and (iii)
each of these covenants is reasonable and necessary to protect and preserve the
interests and properties of the Company. The Representative also acknowledges
and agrees that: (i) irreparable loss and damage will be suffered by the Company
should the Representative breach any of these covenants and agreements; (ii)
each of these covenants and agreements in clauses (a) through (d) of this
Section 7 is separate, distinct and severable not only from the other covenants
and agreements but also from the remaining provisions of this Agreement; and
(iii) the unenforceability of any covenants or agreements shall not affect the
validity or enforceability of any of the other covenants or agreements or any
other provision or provisions of this Agreement.
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8. Successors; Binding Agreement.
a. This Agreement shall be binding upon and shall inure to
the benefit of the Company, its Successors and Assigns and the Company shall
require any Successors and Assigns to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that the Company would be
required to perform it if no such succession or assignment had taken place.
b. Neither this Agreement nor any right or interest hereunder
shall be assignable or transferable by the Representative, his beneficiaries or
legal representatives, except by will or by the laws of descent and
distribution. This Agreement shall inure to the benefit of and be enforceable by
the Representative's legal personal representative.
9. Notice. For the purposes of this Agreement, notices and
all other communications provided for in the Agreement (including the Notice of
Termination) shall be in writing and shall be deemed to have been duly given
when personally delivered or sent by certified mail, return receipt requested,
postage prepaid, addressed to the respective addresses last given by each party
to the other; provided, however, that all notices to the Company shall be
directed to the attention of the President with a copy to the Secretary of the
Company. All notices and communications shall be deemed to have been received on
the date of delivery thereof.
10. Settlement of Claims. The Company's obligation to make the
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any circumstances, including, without
limitation, any set-off, counterclaim, recoupment, defense or other right which
the Company may have against the Representative or others. The Company may,
however, withhold from any benefits payable under this Agreement all federal,
state, city or other taxes as shall be required pursuant to any law or
governmental regulation or ruling.
11. Modification and Waiver. No provisions of this Agreement
may be modified, waived or discharged unless such waiver, modification or
discharge is agreed to in writing and signed by the Representative and the
Company. No waiver by any party hereto at any time of any breach by the other
party hereto of, or compliance with, any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time.
12. Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of Georgia
without giving effect to the conflict of laws principles thereof. Any action
brought by any party to this Agreement shall be brought and maintained in a
court of competent jurisdiction in State of Georgia.
13. Severability. The provisions of this Agreement shall be
deemed severable and the invalidity or unenforceability of any provision shall
not affect the validity or enforceability of the other provisions hereof.
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14. Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto and supersedes all prior agreements, if
any, understandings and arrangements, oral or written, between the parties
hereto with respect to the subject matter hereof.
15. Headings. The headings of Sections herein are included
solely for convenience of reference and shall not control the meaning or
interpretation of any of the provisions of this Agreement.
16. Counterparts. 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.
17. Definitions. For purposes of this Agreement, the
following terms shall have the following meanings:
a. "Accrued Fees" shall mean an amount which shall include
all amounts earned or accrued through the Termination Date but not paid as of
the Termination Date, including (i) fees payable and (ii) reimbursement for
reasonable and necessary expenses incurred by the Representative on behalf of
the Company during the period ending on the Termination Date.
b. The termination of the Representative's engagement shall
be for "Cause" if it is the result of:
(i) the commission or omission by the
Representative of a willful or negligent act
which causes harm to the Company;
(ii) the conviction of the Representative for the
commission or perpetration by the
Representative of any felony or any act of
fraud;
(iii) the failure of the Representative to devote
sufficient time and attention to the business
as provided in Section 1; or
(iv) the failure of the Representative to perform
his duties hereunder in a manner satisfactory
to the Company, as determined by the President
of the Company in his sole discretion;
provided, however, that the Representative
shall have 30 days to cure such failure after
receiving notice from the Company. The Company
shall be obligated to provide only one notice
to Representative pursuant to this Section
17(b)(iv). Thereafter, the Company may
terminate the Representative, without the
Representative having a right to cure, if the
Representative fails to perform his duties in a
manner satisfactory to the President of the
Company, as determined in his sole discretion.
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c. "Confidential Business Information" shall mean any
non-public information of a competitively sensitive or personal nature, other
than Trade Secrets, acquired by the Representative, directly or indirectly, in
connection with the Representative's engagement (including his engagement by the
Company prior to the date of this Agreement), including (without limitation)
oral and written information concerning the Company or its affiliates relating
to financial position and results of operations (revenues, margins, assets, net
income, etc.), annual and long-range business plans, marketing plans and
methods, account invoices, oral or written customer information and personnel
information. Confidential Business Information also includes information
recorded in manuals, memoranda, projections, minutes, plans, computer programs
and records, whether or not legended or otherwise identified by the Company and
its affiliates as Confidential Business Information, as well as information
which is the subject of meetings and discussions and not so recorded; provided,
however, that Confidential Business Information shall not include information
that is generally available to the public, other than as a result of disclosure,
directly or indirectly, by the Representative, or was available to the
Representative on a non-confidential basis prior to its disclosure to the
Representative.
d. "Disability" shall mean a physical or mental infirmity
which impairs the Representative's ability to substantially perform his duties
with the Company for a period of 180 consecutive days, as determined by an
independent physician selected with the approval of both the Company and the
Representative.
e. "Notice of Termination" shall mean a written notice of
termination from the Company which specifies an effective date of termination,
indicates the specific termination provision in this Agreement relied upon, and
sets forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of the Representative's engagement under the provision so
indicated.
f. "Successors and Assigns" shall mean a corporation or other
entity acquiring all or substantially all the assets and business of the Company
(including this Agreement), whether by operation of law or otherwise.
g. "Termination Date" shall mean, in the case of the
Representative's death, his date of death, and in all other cases, the date
specified in the Notice of Termination.
h. "Trade Secrets" shall mean any information, including but
not limited to technical or non-technical data, a formula, a pattern, a
compilation, a program, a device, a method, a technique, a drawing, a process,
financial data, financial plans, product plans, information on customers or a
list of actual or potential customers or suppliers, which: (i) derives economic
value, actual or potential, from not being generally known to, and not being
readily ascertainable by proper means by, other persons who can obtain economic
value from its disclosure or use; and (ii) is the subject of efforts that are
reasonable under the circumstances to maintain its secrecy.
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IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed and its seal to be affixed hereunto by its officers thereunto duly
authorized, and the Representative has signed and sealed this Agreement,
effective as of the date first above written.
MAXXIS GROUP, INC.
ATTEST:
By: By:
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Name: Name:
Title: Title:
REPRESENTATIVE
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EXHIBIT A
DUTIES OF INDEPENDENT SALES REPRESENTATIVE
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EXHIBIT B
BONUS AMOUNT
The Representative shall be eligible to receive a performance bonus,
payable each quarter, which is a percentage of the gross revenue from the 256
legs owned by Maxxis 2000, Inc. based upon his or her performance in accordance
with the following criteria:
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OPEN LEGS NEW ACTIVATIONS PER QUARTER BONUS
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6 180 0.5%
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10 180 1.0
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14 180 1.5
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18 180 2.0
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23 180 2.5
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27 180 3.0
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