Document:

teee_ex104.htm

EXHIBTI 10.4

 

MEDICAL DIRECTOR AGREEMENT

 

This Medical Director Agreement (“Agreement”) entered into and made effective as of this 1st day of May, 2014 (the “Effective Date”), between Fuse Medical, LLC, with offices at 4770 Bryant Irvin Court, Suite 300, Fort Worth, Texas 76107 (“Company”) and Dr. Randall L. Dei herein after referred to as (“Medical Director”) with an address of 7565 S. Cambridge Drive, Franklin, Wisconsin 53132 (each, a “Party” and collectively the “Parties”).

 

RECITALS

 

WHEREAS, Company desires to obtain the services of Medical Director as described in the body of this Agreement and the attached Exhibit “A” (“Services”); and

 

WHEREAS, Medical Director is in the business of providing such Services, and desires to provide them to Company; and

 

WHEREAS, Medical Director has unique knowledge, contacts, skills and abilities that he intends to provide to Company in this representation;

 

NOW, THEREFORE, in consideration of the terms, conditions and mutual promises contained herein, the Parties mutually agree as follows:

 

AGREEMENT

 

1. Scope of Work. 

 

a. Medical Director shall provide the Services according to the schedule and scope of work as set forth in Exhibit “A”, which is attached hereto and made a part of this Agreement by reference.

 

b. Medical Director agrees to furnish all labor, supervision, and services needed to complete his obligations under this Agreement. Medical Director shall report and pay all taxes applicable to the Services that are furnished under this Agreement.

 

c. Medical Director’s title shall be “Pediatric Medical Director of Fuse Medical, LLC”.

 

  

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2. Term. This Agreement shall commence on the Effective Date, and shall remain in effect for successive one year terms, until terminated by the occurrence of one or more of the following:

 

a. Either Party provides written notice to the other Party not less than thirty (30) days prior to the end of the then current term, that such Party desires to terminate this Agreement at the end of the then current term; otherwise, this Agreement shall continue for another one year term; or

 

b. Upon the bankruptcy of either Party, assignment for the benefit of creditors of either Party’s assets, or the appointment of a receiver for either Party’s assets; or

 

c. Either Party provides written notice of termination to the other Party upon the other Party’s material or repeated default in the performance of its or his obligations under this Agreement and failure to cure such default within thirty (30) days of receipt of the notice from the non-breaching Party specifying the default and the intention to terminate; or

 

d. Upon Company’s written notice to Medical Director that the Agreement is being terminated because of Cause. “Cause” means:

 

(i) an intentional tort (excluding any tort relating to a motor vehicle) by Medical Director which causes substantial loss, damage or injury to the property or reputation of the Company or its subsidiaries;

 

(ii) any serious crime or intentional, material act of fraud or dishonesty by Medical Director against the Company;

 

(iii) the commission of a felony that results in other than immaterial harm to the Company’s business or to the reputation of the Company or Medical Director;

 

(iv) habitual neglect of Medical Director’s reasonable duties as outlined in Exhibit “A” (for a reason other than illness or incapacity) which is not cured within thirty (30) days after written notice thereof by the Company’s Board of Directors (the “Board”) to the Medical Director;

 

(v) the disregard of written, material policies of the Company or its subsidiaries which causes other than immaterial loss, damage or injury to the property or reputation of the Company or its subsidiaries which is not cured within thirty (30) days after written notice thereof by the Board from Company to the Medical Director; or

 

(vi) any material breach of the Medical Director’s ongoing obligation not to disclose confidential information and not to assign intellectual property developed during the term of this Agreement which, if capable of being cured, is not cured within thirty (30) days after written notice thereof by the Board to the Medical Director.

 

  

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3. Termination During the First Twelve Months. In the event this Agreement is terminated for any reason during its initial twelve (12) month term, the Parties shall not enter into any agreement with each other for the provision of Services as described hereunder during the remainder of such initial twelve (12) month period unless the financial terms are the same as those contained herein.

 

4. Compensation. Company shall pay Medical Director the sum of $16,667.67 per month in arrears during the term hereof. The Parties acknowledge that the compensation set forth within the foregoing sentence resulted from arms-length negotiations and was determined without regard to the volume or value of referrals by Medical Director, if any, to the Company. This Agreement is not conditioned upon Medical Director’s making any referrals to the Company.

 

5. Confidentiality. The Parties agree to keep confidential all confidential information of the other Party that is generated or obtained in connection with or as a result of performing services under this Agreement, until the end of one (1) year following termination or expiration of the terms of this Agreement. Notwithstanding the foregoing, the Parties shall be permitted to disclose confidential information to the extent that such disclosure required by any valid subpoena, order or judicial process of a court or governmental agency, provided that, to the extent permitted by law, the other Party is notified prior to any such disclosure and is afforded the reasonable opportunity to obtain a protective order or other form of protection. The Medical Director shall not, without the prior written consent of the Company, use the Company’s name in any advertising or promotional literature or publish any articles that (a) relate to the Company, this Agreement, or the Services provided by Medical Director, or (b) otherwise refer to the retention of Medical Director to render Services hereunder.

 

6. Relationship of Parties. 

 

a. Although Medical Director holds a title with the Company, it is understood and agreed that Medical Director is an independent contractor with respect to the performance of each and every part of this Agreement. Medical Director is solely responsible for the supervision, direction and control of his employees (if any), and shall be solely responsible for all labor and expenses in connection therewith. It is understood between the Parties that this is a contract for personal services, and that Medical Director may not substitute any other individual or assign this Agreement to perform the Services, without the express written consent of the Company.

 

b. The Parties recognize that this Agreement does not create any actual or apparent agency, partnership, franchise, or relationship of employer and employee between the Parties. The Medical Director is not authorized to enter into or commit the Company to any agreements, and the Medical Director shall not represent himself as the agent or legal representative of the Company. The Medical Director shall report to and work in conjunction with the Company’s Chief Medical Officer.

 

c. Further, the Medical Director shall not be entitled to participate in any of the Company’s benefits, including without limitation any health or retirement plans. The Medical Director shall not be entitled to any remuneration, benefits, or expenses other than as specifically provided for in this Agreement.

 

d. The Company shall not be liable for taxes, Worker’s Compensation, unemployment insurance, employers’ liability, employer’s FICA, social security, withholding tax, or other taxes or withholding for or on behalf of the Medical Director or any other person consulted or employed by the Medical Director in performing Services under this Agreement. All such costs shall be Medical Director’s responsibility.

 

  

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7. Proprietary Rights.

 

a. The Medical Director acknowledges that he has no right to or interest in its work or product resulting from the Services he performs hereunder, or any of the documents, reports or other materials created by the Medical Director in connection with such Services, nor any right to or interest in any copyright therein. The Medical Director acknowledges that the Services and the products thereof (hereinafter referred to as the “Materials”) have been specially commissioned or ordered by the Company as “works made-for-hire” as that term is used in the Copyright Law of the United States, and that the Company is therefore to be deemed the author of and is the owner of all copyrights in and to such Materials. Notwithstanding the foregoing or anything to the contrary in this Agreement, Company shall have no intellectual property rights to any such device, drug, treatment, therapy, document, report or other material (“Outside Material”) created by Medical Director or under development: (i) prior to the Effective Date (but Medical Director hereby represents that no such Outside Material presently exists or is presently pending); or (ii) on or after the Effective Date as a result of activities conducted outside of the scope of Services provided by Medical Director under this Agreement, provided, however, that any intellectual property created by Medical Director relating to any business line of the Company or its affiliates shall be conclusively deemed to be “works made-for-hire”. Medical Director may retain any and all fees and/or compensation collected by him and/or in his name that is received in connection with any Outside Material and/or the research and development that is conducted outside of the scope of his engagement by Company under this Agreement.

 

b. In the event that such Materials, or any portion thereof, are for any reason deemed not to have been works made-for-hire, the Medical Director hereby assigns to the Company any and all right, title, and interest Medical Director may have in and to such Materials, including all copyrights, all publishing rights, and all rights to use, reproduce, and otherwise exploit the Materials in any and all formats or media and all channels, whether now known of hereafter created. The Medical Director agrees to execute such instruments as the Company may from time to time deem necessary or desirable to evidence, establish, maintain, and protect the Company’s ownership of such Materials, and all other rights, title, and interest therein.

 

c. Notwithstanding the foregoing, the Company acknowledges that the Medical Director’s ability to carry out the Services is heavily dependent upon the Medical Director’s past experience in the industry and in providing similar services to others and both Parties expect Medical Director to continue such work in the future. Subject to the confidentiality provisions herein, generic information communicated to the Company in the course of his engagement by the Company either orally, in the form of presentations, or in documents that report such general industry knowledge is not subject to the terms of section 7(a) and (b) above.

 

8. Standards of Performance. The Medical Director represents and warrants that:

 

a. Medical Director shall provide the Services in accordance with, and shall not violate, applicable laws, rules or regulations, and standards prevailing in the industry and the Medical Director shall obtain all permits or permissions required to comply with such laws, rules or regulations;

 

b. The Materials developed by Medical Director shall be original, clear, and presentable in accordance with generally applicable standards in the industry;

 

  

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c. The Materials developed by Medical Director will not contain libelous, injurious, or unlawful material and will not violate or in any way infringe upon the personal or proprietary rights of third Parties, including property, contractual, employment, trade secrets, proprietary information and non-disclosure rights, or any trademark, copyright, or patent, nor will they contain any format, instruction, or information that is inaccurate or injurious to any person, computer system, or machine;

 

d. The Medical Director shall provide the Services in accordance with the specifications established by the Company.

 

9. Insurance. The Parties acknowledge that the Company presently does not maintain Directors and Officers liability insurance, but is presently investigating such coverages for itself and its affiliates (but no assurance is provided as to the whether such coverage will actually be obtained). The Company is in the process of merging into another company, Golf National, Inc., which presently maintains such coverage. The Company will make a copy of such insurance policy available to Medical Director for his review upon request.

 

10. Mutual Indemnification. Each Party shall indemnify and hold the other Party (and its members, directors, employees, agents and representatives) harmless from any and all claims, liabilities, damages, taxes, fines, repayment obligations, or expenses, including court costs and reasonable attorneys’ fees (collectively, “Claims”), arising from any act or omission by the indemnifying Party or its employees or agents (excepting the indemnified Party), or from the indemnifying Party’s material breach of this Agreement. Without limiting the generality of the foregoing, each Party expressly agrees to indemnify and hold the other Party (and its members, directors, employees, agents and representatives) harmless from any and all Claims arising from or relating to: (a) any goods and/or services provided by or on behalf of the indemnifying Party; (b) any other work engaged in by the indemnifying Party outside of this Agreement; and/or (c) the indemnifying Party’s compliance with federal and state laws (including but not limited to Medicare and Medicaid requirements) relating to the indemnifying Party’s submission or assignment of claims to government payors or third-party payors. Notwithstanding the foregoing, indemnity obligations under this Section shall only apply to any costs or expenses incurred by the indemnified Parties which are not covered or coverable by applicable liability insurance. In the event the indemnity provisions of this Section are interpreted to reduce any insurance coverage to which any Party would otherwise be entitled in the absence of such provisions, they shall be deemed inoperative and not a part of this Agreement. This Section shall survive the termination of this Agreement for the period of the applicable statute of limitations.

 

11. Representations and Warranties Concerning Company. Company hereby represents and warrants to Medical Director that, to the actual knowledge of its Chief Executive Officer (“Knowledge”), no complaint, action, suit, arbitration, proceeding, hearing, charge, demand, claim or investigation has been filed or commenced with respect to the Company or, to such Knowledge, is threatened. A civil action styled Cutler v. Fuse Medical LLC, et. al, has been commenced naming the Company as a defendant, and such litigation has been dismissed without prejudice for failure to prosecute.

 

12. Change or Clarification to Law. In the event of a change in the Stark Law or the federal Anti-kickback Statute or similar law, regulation or interpretation thereof which materially affects any aspect of the arrangement between Medical Director and the Company, including, without limitation, the compensation payable to Medical Director, either Party may propose a new basis for the arrangement by written notice to the other Party. In the event such legislation, regulation and interpretation makes the arrangement herein illegal or defeats the fundamental purposes and respective benefits of this Agreement and a new arrangement cannot be agreed to within sixty (60) days of a proposal, either Party may terminate this Agreement by written notice to the other Party given within twenty (20) days following the end of the sixty (60) day period.

 

  

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13. No Violation of Law. Each Party represents and warrants to the other Party it shall not knowingly violate any federal, state, or local laws or regulations by entering into this Agreement or performing its obligations hereunder.

 

14. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without application of its conflict of laws principles. Venue for any dispute shall be in Tarrant County, Texas.

 

15. Amendment. No amendment or modification of this Agreement shall be effective unless set forth in writing and signed by both Parties.

 

16. Entire Agreement. This Agreement sets forth the full and complete understanding of the Parties, and supersedes all prior agreements, whether made orally or in writing.

 

17. Execution. This Agreement may be executed by facsimile in multiple counterparts, each of which shall together constitute one and the same instrument.

 

18. Assignment. The Company may freely assign this Agreement, in whole or in part. The Medical Director may not, without the written consent of the Company, assign, subcontract, or delegate its obligations under this Agreement, except that the Medical Director may transfer the right only to receive any amounts which may be payable to it for performance under this Agreement, and then only after receipt by the Company of written notice of such assignment or transfer.

 

19. Severability. In the event that any clause or provision of this Agreement is found by a court of competent jurisdiction to be unenforceable, then such clause shall be deemed severed from this Agreement and the balance of the clause or provision shall be given full force and effect. In the event that any portion of the covenant in the following Section is found by a court of competent jurisdiction to be excessively broad in terms of geographic coverage, duration or scope or otherwise, then such provision shall be deemed modified to conform to the broadest interpretation consistent with applicable law in order to protect the Company from economic harm caused by the Medical Director following such Medical Director receiving education, experience, contacts and compensation from the Company pursuant to the terms of this Agreement.

 

  

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20. Covenant. 

 

a. Medical Director hereby expressly covenants and agrees that during the term hereof and for a period of two (2) years following the date on which this Agreement terminates, whether such termination is upon expiration or termination of this Agreement, he will not, directly or indirectly, in any capacity whatsoever, provide any consulting services similar to those described in Exhibit A or any part for any thereof with any company or entity competitive with the Company. For the avoidance of doubt, any entity will be deemed “competitive” with the Company if such entity, wherever situated (i) distributes or sells goods or services with respect to which the Company from time to time designates as a current or prospective business line, or (ii) provides marketing or consulting services for entities described in clause 20(a)(i) above. The Parties acknowledge that this Agreement does not pertain to Medical Director’s performance of patient services at all and that Medical Director is free to provide care and treatment to any patient at any location during or after the term of this Agreement. Consequently, it is the intent of the Parties that Texas Business Commerce Code Section 15.50(b) shall not apply to this Agreement.

 

b. For the avoidance of doubt, the business lines covered by clause 20(a)(i) above are the following: internal fixations, retail pharmacies, nutritional supplements, pain creams, wound care, and such other business lines as may be entered by the Company or its affiliates from time to time. Notwithstanding the foregoing, nothing herein shall restrict Medical Director from providing any services with respect to any persons or entities which had engaged him in a business transaction prior to the date hereof and which had not become clients, investors, partners, or customers of the Company or its affiliates.

 

c. In the event that Medical Director breaches the covenant contained in this Paragraph 20, Medical Director agrees to pay to the Company, at the Company’s election, either (i) as liquidated damages and not as a penalty, a sum equal to three times the aggregate amount of compensation paid by the Company to Medical Director pursuant to Paragraphs 3 during the term and any renewal hereof, together with all expenses, including reasonable attorneys’ fees, incurred by the Company in enforcing its rights under this Paragraph 20, and (ii) the compensatory damages actually incurred by the Company arising from the breach. In addition, the Parties agree that monetary damages are not an adequate remedy and are not easily ascertained so that the Company may seek equitable relief including an injunction to specifically enforce this covenant.

 

21. Review by Counsel. Medical Director confirms that he has had full and fair opportunity to review this Agreement with his legal counsel and discuss the terms hereof with such counsel and the Company.

 

22. Employment Agreement. The Parties acknowledge that they may consider entering into an employment agreement at some time in the future. No assurances of such employment arrangement are made by either Party as of the date hereof.

 

  

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IN WITNESS WHEREOF, the Parties have executed this Agreement effective as of the date and year first written above.

 

	 	FUSE MEDICAL, LLC	 
	 	 	 	 
	
  

	
By: 

	/s/ Alan Meeker	 
	 	 	
Alan Meeker, Manager

	 
	 	 	 	 
	 	 	 	 
	 	By:	/s/ Randall L. Dei	 
	 	 	Randall L. Dei, DPM	 

 

  

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EXHIBIT A: SERVICES

 

	
1.

	
Foot and Ankle Space

 

	
a.  

	
Act as the Foot and Ankle space DPM Medical Director

 

	
i.  

	
Strategic business development

 

	
ii.  

	
Communication point person to the Fuse and affiliated entities physician leadership structures.

 

	
iii.  

	
Director of Foot and Ankle related Fuse Verticals

 

1. Planning for implantation of Foot & Ankle product lines

 

2. Physician Panel development and oversight

 

3. Physician interaction oversight for shelving process

 

4. Oversight of product review

 

5. Liaison between Physician and Fuse’s product line managers

 

	
b.  

	
Work with Foot and Ankle Space and physician counterpart(s) in development of parallel initiatives

 

	
2.

	
Foot and Ankle DPM > National Director (ND)

 

	
a.  

	
Provide leadership and direction to the National Director of Podiatry of the Company

 

	
b.  

	
Develop strategic planning and organizational documents for directorships and leaders

 

	
c.  

	
Work with the DPM-ND to develop recruitment and vetting efforts for physician partners

 

	
d.  

	
Report to Fuse organizational leaders regarding responsibilities, performance and on-going physician directors and leaders development

 

  

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3.

	
Provider Network Development

 

Lead and assist in the development of both primary market service areas (e.g., close personal contacts) and secondary market service areas (e.g., attenuated contacts, trade show contacts) for the following medical specialties and geographic locations to market compound Company’s products:

 

	
a.  

	
Primary market provider network

 

	
b.  

	
Podiatry and foot/ankle

 

	
c.  

	
Pain management/orthopedic

 

	
d.  

	
Primary care physicians

 

	
e.  

	
Wound care providers and corporate management entities

 

	
f.  

	
Other identified medical specialties

 

Secondary market provider network: working with existing medical provider, establish contacts to assist the Company in the development of a local provider network targeting, but not limited to identified specialties (e.g., podiatry, foot and ankle, orthopedics, and pain).

 

	
4.

	
Direct Physician Support (or assisting Directors)

 

	
a.  

	
Collateral documents

 

	
b.  

	
Physician training/conclaves

 

	
c.  

	
Staff-training

 

	
d.  

	
Field support

 

	
e.  

	
Physician/Staff/Patient satisfaction

 

	
f.  

	
Assist Physicians for Ethical Patient Solutions (PEPS) in the implementation of their representative network within the Company’s Clients.

 

	
g.  

	
Assist in and oversee the implementation and training programs of physicians, physician office staff and clients in the proper utilization of the Company’s information technology platforms.

 

  

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5.

	
Non-Physician Partner Product Utilization, Outcome Tracking and Education

 

	
a.  

	
Utilization review as described above

 

	
b.  

	
In conjunction with Company’s Chief Medical Officer, oversee the development and implementation of podiatry service sector clinical tracking programs and indicators to demonstrate the effectiveness of Company’s products.

 

	
c.  

	
Assist in the development and implementation of product education, clinical applications, efficacy and clinical treatment protocols for Company’s podiatry products.

 

	
d.  

	
Establish a library of clinical white papers and other research documents that will be available to Company’s clients for Company’s podiatry products.

 

	
e.  

	
Implement a product improvement process for podiatry service products.

 

	
6.

	
Vertical Service Line Development

 

	
a.  

	
Identify and fully vet key physician leaders for product line development

 

	
b.  

	
Assist the product line physician leaders with:

 

	
i.  

	
Identifying and vetting their specific product panels

 

	
ii.  

	
Agenda development for panel and subcommittee meetings

 

	
iii.  

	
Action planning and oversight

 

	
iv.  

	
Coordination with Fuse staff

 

	
v.  

	
Implementation, tracking, utilization, quality assurance and outcome analysis

 

	
vi.  

	
Reporting to Fuse organization leaders

 

	
7.

	
Hours

 

	
a.  

	
Be available every Thursday afternoon, all day Fridays and Saturdays and partial day Sundays as needed.

 

	
b.  

	
Be available evenings (7PM-10PM CST) Monday thru Wednesday as needed.

 

  

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c.  

	
Provide weekly reports as to activities due each Sunday PM and action planning for future activities.

 

	
d.  

	
Physician Product Utilization, Outcome Tracking & Education

 

	
·  

	
Utilization review as described above

 

	
·  

	
In conjunction with the Company’s Chief Medical Officer oversee the development and implementation of Podiatry service sector clinical _________________________ Company’s products.

 

	
·  

	
Assist in the development and implementation of product education, clinical applications, efficacy and clinical treatment protocols for the Company’s podiatry products.

 

	
·  

	
Establish a library of clinical white papers and other research documents that will be available to the Company’s clients for the Company’s podiatry products.

 

	
·  

	
Implement a product improvement process for podiatry service products.

 

	
e.  

	
Vertical Service Line Development

 

	
·  

	
Identify and fully vet key physician leaders for product line development

 

	
·  

	
Assist the product line physician leaders with:

 

	
·  

	
Identifying and vetting their specific product panels

 

	
·  

	
Agenda development for panel and subcommittee meetings

 

	
·  

	
Action planning and oversight

 

	
·  

	
Coordination with Fuse staff

 

	
·  

	
Product identification, resourcing, review, selection, usage implementation, tracking, utilization, quality assurance and outcome analysis

 

	
·  

	
Reporting to Fuse organizational leaders

 

	
f.  

	
Hours

 

	
·  

	
Be available every Thursday afternoon, all day Friday and Saturday and a partial day Sunday as needed.

 

	
·  

	
To be available evenings (7PM-10PM CST) Monday thru Wednesday as needed.

 

	
·  

	
Weekly report as to activities due each Sunday PM and action planning for future activities.

 

12teee_ex105.htm

EXHIBIT 10.5

 

EXECUTION COPY

 

GENERAL COUNSEL AGREEMENT

 

This General Counsel Agreement (“Agreement”) entered into and made effective as of this 1st day of July, 2014 (the “Effective Date”), between Fuse Medical, Inc., with offices at 4770 Bryant Irvin Court, Suite 300, Fort Worth, Texas 76107 (“Company”) and Ross Eichberg, P.C. (hereinafter referred to as “General Counsel”) with an address of 358 Queen Anne Road, Stevensville, Maryland 21666 (each, a “Party” and collectively the “Parties”).

 

RECITALS

 

WHEREAS, Company desires to obtain the services of General Counsel as described in the body of this Agreement and the attached Exhibit “A” (“Services”); and

 

WHEREAS, General Counsel is in the business of providing such Services, and desires to provide them to Company; and

 

WHEREAS, General Counsel has unique knowledge, contacts, skills and abilities that it intends to provide to Company in this representation.

 

NOW, THEREFORE, in consideration of the terms, conditions and mutual promises contained herein, the Parties mutually agree as follows:

 

AGREEMENT

 

1. Scope of Work.

 

(a) General Counsel shall provide the Services according to the schedule and scope of work as set forth in Exhibit “A”, which is attached hereto and made a part of this Agreement by reference.

 

(b) General Counsel agrees to furnish all labor, supervision, and services needed to complete its obligations under this Agreement. General Counsel shall report and pay all taxes applicable to services that are furnished under this Agreement.

 

(c) General Counsel’s title shall be “General Counsel of Fuse Medical, Inc.”.

 

(d) General Counsel shall report to the Chief Executive Officer of the Company.

 

2. Term. This Agreement shall commence on the Effective Date (which may be advanced or delayed by mutual consent), and shall remain in effect for an initial five (5) year term and thereafter successive one year terms, until terminated by the occurrence of one or more of the following:

 

(a) Either Party provides written notice to the other Party not less than thirty (30) days prior to the end of the then current term, that such Party desires to terminate this Agreement at the end of the then current term; otherwise, this Agreement shall continue for another one year term; or

 

  

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(b) Upon the bankruptcy of General Counsel, assignment for the benefit of creditors of General Counsel’s assets, or the appointment of a receiver for General Counsel’s assets; or

 

(c) Upon Company’s written notice to General Counsel that the Agreement is being terminated because of Cause. “Cause” means:

 

(i) an intentional tort (excluding any tort relating to a motor vehicle) by General Counsel which causes substantial loss, damage or injury to the property or reputation of the Company or its subsidiaries;

 

(ii) any serious crime or intentional, material act of fraud or dishonesty by General Counsel against the Company;

 

(iii) the commission of a felony that results in other than immaterial harm to the Company’s business or to the reputation of the Company or General Counsel;

 

(iv) habitual neglect of Executive’s reasonable duties (for a reason other than illness or incapacity) which is not cured within thirty (30) days after written notice thereof by the Board to the General Counsel;

 

(v) the disregard of written, material policies of the Company or its subsidiaries which causes other than immaterial loss, damage or injury to the property or reputation of the Company or its subsidiaries which is not cured within thirty (30) days after written notice thereof by the Board to the Executive; or

 

(vi) any material breach of the General Counsel’s ongoing obligation not to disclose confidential information and not to assign intellectual property developed during employment which, if capable of being cured, is not cured within thirty (30) days after written notice thereof by the Board to the General Counsel.

 

(d) Upon the Company’s ninety (90) days’ written notice to General Counsel that the Agreement is being terminated Without Cause. In the event that the Company terminates this Agreement Without Cause, the Company shall provide General Counsel a lump sum equal to the base compensation for the remainder of the initial five (5)-year term or any one (1) year extension term, as applicable, that would have remained but for such termination Without Cause upon General Counsel’s execution and non-revocation of a general and specific release containing such terms and conditions as are necessary in the Company’s sole discretion and in a form acceptable to the Company, and non-disparagement, non-competition and confidentiality agreements consistent with the terms of this Agreement. Company shall prepare and deliver to General Counsel execution drafts of such agreements prior to, or simultaneously with, the termination Without Cause. The Company acknowledges that General Counsel would not have entered into this Agreement without the severance provisions set forth within this Paragraph 2(d) and Company desires to extend such provisions to General Counsel to induce General Counsel to leave the private practice of law with his current law firm. In return, General Counsel has agreed to be bound by the covenant not-to-compete for the full two (2) years described within Paragraph 16(a) of this Agreement following termination Without Cause.

 

  

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3. Compensation/Expenses/Equity Interests.

 

(a) Company shall pay General Counsel (a) base compensation equal to the sum of $300,000 per year in 24 equal biweekly installments of Twelve Thousand Five Hundred Dollars ($12,500) in arrears during the term and any renewal terms hereof; (b) bonus compensation in such amount as the Board of Directors of Fuse may determine based upon General Counsel’s performance and the financial condition of the Company; and (c) a signing bonus payable on the Effective Date equal to $61,000.

 

(b) Company shall either include General Counsel and his family in its group health insurance policy or reimburse General Counsel for the cost of obtaining separate coverage, and shall include General Counsel in its Directors and Officers liability insurance policy (including an E&O endorsement) which Company warrants will be effective on or prior to the Effective Date.

 

(c) Company shall provide housing for General Counsel in Fort Worth and a reasonable allowance to cover weekly coach air travel between Fort Worth and Maryland for a period of two years. Such housing and travel allowance shall not exceed $2,500 per month. Company shall reimburse General Counsel for reasonable and customary business expenses incurred in connection with the business of the Company.

 

(d) General Counsel shall also have an equity participation in other future projects of the Company or its affiliates consistent with such opportunities made available to other members of the Company’s Executive Team. General Counsel will also be eligible to participate in the Company’s stock incentive plan when that is organized to the same extent as other members of the Executive Team.

 

4. Confidentiality. The Parties agree to keep confidential all confidential information that is generated or obtained in connection with or as a result of performing services under this Agreement, until the end of two (2) years following termination or completion of the terms of this Agreement. Notwithstanding the foregoing, the obligation to protect confidentiality shall not limit either Party’s right or obligation to record leases, memorandums of leases, make such other public record filings as are necessary to fully secure the benefits of this Agreement, or disclose information as required by law or by any government authority. The General Counsel shall not, without the prior written consent of the Company, use the Company’s name in any advertising or promotional literature or publish any articles relating to the Company, this Agreement, or the Services and shall not otherwise refer to the retention of General Counsel to render consulting services hereunder.

 

5. Relationship of Parties.

 

(a) Although General Counsel holds a title with the Company, it is understood and agreed that General Counsel is an independent contractor with respect to the performance of each and every part of this Agreement. General Counsel is solely responsible for the supervision, direction and control of General Counsel’s employees (if any), and shall be solely responsible for all labor and expenses in connection therewith. It is understood between the Parties that this is a contract for personal services, and that General Counsel may not substitute any other individual or assign this Agreement to perform the Services, without the express written consent of the Company. Company retains outside counsel for compliance and other specialized legal needs and such legal work is outside the scope of General Counsel’s services.

 

  

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(b) The parties to this Agreement recognize that this Agreement does not create any actual or apparent agency, partnership, franchise, or relationship of employer and employee between the parties. The General Counsel is not authorized to enter into or commit the Company to any agreements, and the General Counsel shall not represent itself as the agent or legal representative of the Company except as set forth on business cards and other documentation provided by the Company.

 

(c) General Contractor represents that General Contractor maintains an independently established business and, if required by federal law, has obtained a federal tax identification number. General Contractor further acknowledges and warrants that while performing all services or work under this Agreement, General Contractor will be operating on behalf of an independently owned business which has fully complied with all legal requirements including but not limited to obtaining a federal tax identification number, registration with the applicable department(s) of labor, and maintenance of any required employer-sponsored benefit programs such as unemployment, worker’s compensation, medical, or disability insurance.

 

(d) Further, the General Counsel shall not be entitled to participate in any of the Company’s benefits, including without limitation any health or retirement plans except with the consent of the Company. The General Counsel shall not be entitled to any remuneration, benefits, or expenses other than as specifically provided for in this Agreement.

 

(e) The Company shall not be liable for taxes, Worker’s Compensation, unemployment insurance, employers’ liability, employer’s FICA, social security, withholding tax, or other taxes or withholding for or on behalf of the General Counsel or any other person consulted or employed by the General Counsel in performing Services under this Agreement. All such costs shall be General Counsel’s responsibility.

 

6. Proprietary Rights.

 

(a) The General Counsel acknowledges that it has no right to or interest in its work or product resulting from the Services performed hereunder, or any of the documents, reports or other materials created by the General Counsel in connection with such Services, nor any right to or interest in any copyright therein. The General Counsel acknowledges that the Services and the products thereof (hereinafter referred to as the “Materials”) have been specially commissioned or ordered by the Company as “works made-for-hire’’ as that term is used in the Copyright Law of the United States, and that the Company is therefore to be deemed the author of and is the owner of all copyrights in and to such Materials.

 

(b) In the event that such Materials, or any portion thereof, are for any reason deemed not to have been works made-for-hire, the General Counsel hereby assigns to the Company any and all right, title, and interest General Counsel may have in and to such Materials, including all copyrights, all publishing rights, and all rights to use, reproduce, and otherwise exploit the Materials in any and all formats or media and all channels, whether now known of hereafter created. The General Counsel agrees to execute such instruments as the Company may from time to time deem necessary or desirable to evidence, establish, maintain, and protect the Company’s ownership of such Materials, and all other rights, title, and interest therein.

 

(c) Notwithstanding the foregoing, the Company acknowledges that the General Counsel’s ability to carry out the work required is heavily dependent upon the General Counsel’s past experience in the health care and pharmacy industries and in providing similar services to others and they expect to continue such work in the future. Subject to the confidentiality provisions herein, generic information communicated to the Company in the course of this project either orally, in the form of presentations, or in documents that report such general industry knowledge is not subject to the terms of section 6(a) and (b) above.

 

  

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7. Warranty of Performance. The General Counsel represents and warrants that:

 

(a) The Services shall be performed in accordance with, and shall not violate, applicable laws, rules or regulations, and standards prevailing in the industry and the General Counsel shall obtain and maintain all permits or permissions required to comply with such laws, rules or regulations. Notwithstanding the foregoing, the Company waives any claims against the General Counsel relating to practicing law outside of the jurisdictions of the District of Columbia and Maryland where the principal of General Counsel is licensed to practice law.

 

(b) The Materials shall be original, clear, and presentable in accordance with generally applicable standards in the industry;

 

(c) The Materials will not contain libelous, injurious, or unlawful material and will not violate or in any way infringe upon the personal or proprietary rights of third parties, including property, contractual, employment, trade secrets, proprietary information, and non-disclosure rights, or any trademark, copyright, or patent, nor will they contain any format, instruction, or information that is inaccurate or injurious to any person, computer system, or machine;

 

(d) The General Counsel has full power and authority to enter into and perform its obligations under this Agreement; and

 

(e) The General Counsel will perform the Services in accordance with the specifications established by the Company.

 

8. Indemnification. Company shall defend, indemnify and hold the General Counsel harmless from any and all claims, liabilities, damages, taxes, fines, repayment obligations, or expenses, including court costs and reasonable attorneys’ fees (collectively, “Claims”), arising from any act or omission by the Company or its affiliates or their respective officers, partners, shareholders, directors, officers, employees or agents, or from the Company’s material breach of this Agreement. Without limiting the generality of the foregoing, the Company expressly agrees to indemnify and hold the General Counsel harmless from any and all Claims arising from or relating to: (a) any goods and/or services provided by or on behalf of the Company or its affiliates; (b) any other work engaged in by the Company or its affiliates outside of this Agreement; and/or (c) the Company’s and its affiliates’ compliance with federal and state laws (including but not limited to Medicare and Medicaid requirements, the Stark law, and the federal anti-kickback statute, false claims acts, and state versions of such statutes). Any adjudicated claims by the Company against General Counsel shall be funded solely by proceeds, if any, from the D&E and E&O policies that the Company may elect to procure for that purpose. This Section shall survive the termination of this Agreement for the period of the applicable statute of limitations or the tail provisions under such D&E and E&O policies whichever first occurs.

 

9. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without application of its conflict of laws principles. Venue for any dispute shall be in Tarrant County, Texas.

 

  

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10. Conflict of Interests. General Counsel may continue General Counsel’s outside law practice provided it does not materially detract from the performance of General Counsel’s duties hereunder. The Company hereby waives the appearance of any conflict of interest relating to General Counsel’s representation of any of General Counsel’s outside clients or any investments in any of their ventures. General Counsel’s clients include, among others, various principals and affiliates in the Crestview Group family of companies (including D. Alan Meeker who is an officer of the Company), the Mallick Group of Fort Worth, Texas and its affiliates, Frank Bonilla of Fort Worth, Texas and his affiliates, Acacia Health Pte Ltd., a Singapore company, and its affiliates, and World Health Industries, Inc. and its affiliates and various Texas Limited Partnerships whose function is to own compound pharmacies all of which are affiliated with The Crestview Group. In the event of an actual conflict of interest between the Company and such clients that cannot be amicably resolved, General Counsel shall recuse himself from representing either party in the transaction giving rise to the conflict but such recusal shall not prejudice General Counsel’s interests in this Agreement or ability to represent the Company or other client in unrelated matters. General Counsel may have other business interests and may participate in other investments or activities in addition to those relating to the Company and its affiliates. The Company and its affiliates shall not have any right, by virtue of this Agreement or otherwise, to share or participate in any other of General Counsel’s (or its affiliates) business interests, investments or activities or the income or proceeds derived therefrom. General Counsel shall have no liability to Company or its affiliates by reason of participating in any such other business, investment or activity.

 

11. Amendment. No amendment or modification of this Agreement shall be effective unless set forth in writing and signed by both Parties.

 

12. Entire Agreement. This Agreement sets forth the full and complete understanding of the Parties, and supersedes all prior agreements, whether made orally or in writing.

 

13. Execution. This Agreement may be executed by facsimile in multiple counterparts, each of which shall together constitute one and the same instrument.

 

14. Assignment. The Company may freely assign this Agreement, in whole or in part. The General Counsel may not, without the written consent of the Company, assign, subcontract, or delegate its obligations under this Agreement, except that the General Counsel may transfer the right only to receive any amounts which may be payable to it for performance under this Agreement, and then only after receipt by the Company of written notice of such assignment or transfer.

 

15. Severability. In the event that any clause or provision of this Agreement is found by a court of competent jurisdiction to be unenforceable, then such clause shall be deemed severed from this Agreement and the balance of the clause or provision shall be given full force and effect. In the event that any portion of the covenant in the following Section is found by a court of competent jurisdiction to be excessively broad in terms of geographic coverage, duration or scope or otherwise, then such provision shall be deemed modified to conform to the broadest interpretation consistent with applicable law in order to protect the Company from economic harm caused by General Counsel.

 

  

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16. Covenant.

 

(a) General Counsel hereby expressly covenants and agrees that for a period of two (2) years following the date on which this Agreement terminates, whether such termination is upon expiration or termination of this Agreement, General Counsel will not serve as general counsel or otherwise provide legal advice for any transaction competitive with the Company unless such termination arose as a result of the default of the Company hereunder. For the avoidance of doubt, a transaction will be deemed “competitive” with the Company if the transaction provides any similar services offered by the Company to a client other than those persons or entities referenced in Section 10 above and/or such similar services (i) shall be performed in the United States and (ii) involves the distribution, provision of or sale of goods or services described in Section 16(b) below.

 

(b) For the avoidance of doubt, the business lines covered by clause 16(a) above shall be limited to the following: internal fixation products, bone substitute materials, compounding pharmacies, nutritional supplements, biological tissues, wound care or any other similar product service lines offered by the Company during the term of the Agreement. Notwithstanding the foregoing, nothing herein shall restrict General Counsel from providing legal services for any non-competitive services with respect to any persons or entities which had engaged him in a business transaction prior to the date hereof.

 

(c) General Counsel agrees that, except as may be required under compulsion of law or as part of General Counsel’s duties under this Agreement, General Counsel shall make no representations or statements, either direct or indirect (in the form of oral or written statements), to anyone (including but not limited to prospective clients, employers, existing or prospective customers or employees of the Company, or to any consultant, agent or representative of any customer of the Company, or to any representative or agent of the media) that disparages the Company, the Company’s past, present, or future performance, personnel, directors, executives, shareholders, operational conditions, services or organizational capabilities. The term “disparage” shall mean any statement which, directly or indirectly, creates a negative impression about the subject matter of the statement.

 

In the event that General Counsel breaches the covenant contained in this Paragraph 16, General Counsel agrees to pay to the Company at the Company’s election, either (i) as liquidated damages and not as a penalty, a sum equal to two times the aggregate amount of compensation paid by the Company to General Counsel pursuant to Paragraphs 3 during the term and any renewal hereof, together with all expenses, including reasonable attorneys’ fees, incurred by the Company in enforcing its rights under this Paragraph 16, and (ii) the compensatory damages actually incurred by the Company arising from the breach. In addition, the parties agree that monetary damages are not an adequate remedy and are not easily ascertained so that the Company may seek equitable relief including an injunction to specifically enforce this covenant.

 

17. Review by Counsel. General Counsel and Company each confirms that General Counsel or the Company have had full and fair opportunity to review this Agreement with their respective legal counsel and discuss the terms hereof with such counsel.

 

[SIGNATURES ON FOLLOWING PAGE]

 

  

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IN WITNESS WHEREOF, the Parties have executed this Agreement effective as of the date and year first written above.

 

 

	 	FUSE MEDICAL, INC.	 
	 	 	 	 
	
 

	
By: 

	/s/ Alan Meeker	 
	 	 	Alan Meeker, CEO	 

 

	 	ROSS EICHBERG, PC	 
	 	 	 	 
	
 

	
By: 

	/s/ Ross Eichberg	 
	 	 	Ross Eichberg, Manager	 

 

  

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EXHIBIT A: SERVICES

 

General charge of the ongoing legal affairs of the Company and its affiliated organizations.

 

Monitoring and liaison with outside transactional, litigation, compliance and regulatory legal counsel, and establishing budgets and other performance criteria with outside counsel.

 

Contract structuring, drafting and negotiation regarding the M&A, transactional and operational activities of the Company.

 

Coordinate with other executives within the Company to help those executives make legal, compliance and regulatory decisions consistent with legal requirements.

 

The duties of General Counsel shall be established by the Board of Directors from time to time and carried out and implemented under the direction of the Board of Directors.

 

Assistance in the drafting and preparation of any required public company documents required to be filed by the Company.

 

 

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