CONSULTING AGREEMENT
Exhibit
10.24
THIS IS AN AGREEMENT,
effective September 13, 2007 between E4 LLC, a Florida based
company (hereinafter called "Consultant"), and NewCardio, Inc., a Delaware
corporation, having an address at 0000 Xxxxxxx Xxxxx, Xxxxx 000, Xxx Xxxx, XX
00000 (hereinafter called "Company").
WHEREAS, Company desires to
obtain the professional services of Consultant described in Section 1 below
(hereinafter called "Services"), and
WHEREAS Consultant represents
that he is willing to render such services for the benefit of the
Company;
NOW THEREFORE, in
consideration of the premises and mutual covenants herein set forth, the parties
hereto agree as follows
I.
SCOPE OF SERVICES
During
the term of this Agreement, it is understood between the parties that the sole
agent of Consultant to provide the Services hereunder of Consultant shall be
Xxxxxx Xxxxxxxx unless otherwise agreed by the Company. Consultant will be
responsible for completing mutually agreed upon assignments and for providing
business guidance in areas mutually agreed upon, and such other services as
shall be directed by the Company, at reasonable times and locations as required,
including participating in meetings, consulting with Company's employees,
including telephone consultations, and to aiding, advising and assisting Company
in connection with such tasks, problems and matters defined and presented to
Consultant by Company.
The scope
of the assignment entails six (6) full business days per month during the term
hereof of work related to corporate development and business development,
including travel, education, research, analysis, preparation, administration,
and reporting during the term of the agreement.
"Consultant" will provide "Company"
with monthly activity report at the end of each month.
2.
BEST
EFFORTS BY CONSULTANT
Consultant
shall use commercially reasonable efforts to complete the Services during the
term of this Agreement and to otherwise comply with this Agreement. Consultant
warrants that the Services provided hereunder will he of the highest
professional quality commensurate with Consultant's reputation.
3.
INDEPENDENT
CONTRACTOR; BENEFITS
3.1.
Independent Contractor.
It is the
express intention of the Company and Consultant
that Consultant perform the Services as an independent contractor to the
Company. Nothing in this Agreement shall in any way be construed to constitute
Consultant as an agent,
employee
or representative of the Company. Without limiting the generality of the
foregoing, Consultant is not authorized to bind the Company to any liability or
obligation or to represent that Consultant has any such authority. Consultant
agrees to furnish (or reimburse the Company for) all tools and materials
necessary to accomplish this Agreement and shall incur all expenses associated
with performance, except as expressly provided herein. Consultant acknowledges
and agrees that Consultant is obligated to report as income all compensation
received by Consultant pursuant to this Agreement. Consultant agrees to and
acknowledges the obligation to pay all self-employment and other taxes on such
income.
3.2.
Benefits.
The Company and Consultant agree that Consultant will receive no
Company-sponsored
benefits from the Company. If Consultant is reclassified by a state or federal
agency or court as Company's employee, Consultant will become a reclassified
employee and will receive no benefits from the Company, except those mandated by
state or federal law, even if by the terms of the Company's benefit plans or
programs of the Company in effect at the time of such reclassification,
Consultant would otherwise be eligible for such benefits.
4.
COMPENSATION and PAYMENT TERMS
Compensation
for Services provided by the Consultant during the term hereof will be as
follows:
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$24,000.00
per month payable in accordance with the Company's normal payroll
procedures,
commencing on September 13, 2007,
provided,
however that all such compensation owing hereunder for the period
beginning on September 13, 2007 and ending on December 31, 2007 shall
accrue during such period, to be paid in accordance with the Company's
normal payroll procedures on January 15,
2008.
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A
restricted stock grant equal to 1,106,723 shares of Common Stock made
pursuant to the Company's form of restricted stock purchase agreement (an
"RSPA"), at a purchase price per share equal to the fair market value of a
share of Common Stock on the date of grant as shall be determined by the
Board of Directors of the Company, which purchase price shall be
considered paid by Consultant in the form of services rendered and which
shares shall be released from the Company's repurchase right as follows:
1/36th
of such shares shall he released on each monthly anniversary of Service,
provided Consultant is a Service Provider (as defined in the RSPA) to the
Company on all such dates.
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A
restricted stock grant equal to 368,908 shares of Common Stock made
pursuant to an RSPA, at a purchase price per share equal to the fair
market value of a share of Common Stock on the date of grant as shall be
determined by the Board of Directors of the Company, which shares shall be
fully released from the Company's repurchase option as of the date of
grant.
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All
out-of-pocket costs incurred by Consultant in connection with his
performance of the Services during the term hereof will be invoiced by
Consultant at the end of each month and reimbursed in accordance with the
Company's normal payroll procedures,
provided,
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however,
that for any expenditure or series of related expenditures in excess of $7,500,
Consultant must receive advance approval from the Company in order for such
expenses to qualify for reimbursement hereunder.
5.
NONDISCLOSURE
5.1.
Definition.
"Confidential Information" means any non-public information that
relates
to the actual or anticipated business or research and development of the
Company, technical data, trade secrets or know-how, including, but not limited
to, research, product plans or other information regarding Company's products or
services and markets therefor, customer lists and customers (including, but not
limited to, customers of the Company on whom Consultant called or with whom
Consultant became acquainted during the term of this Agreement), software,
developments, inventions, processes, formulas, technology, designs, drawing,
engineering, hardware configuration information, marketing, finances or other
business information. Confidential Information does not include information that
(i) is known to Consultant at the time of disclosure to Consultant by the
Company as evidenced by written records of Consultant, (ii) has become publicly
known and made generally available through no wrongful act of Consultant or
(iii) has been rightfully received by Consultant from a third party who is
authorized to make such disclosure.
5.2.
Nonuse and
Nondisclosure. Consultant will not, during or subsequent to the
term of
this Agreement, (i) use the Confidential Information for any purpose whatsoever
other than the performance of the Services on behalf of the Company or (ii)
disclose the Confidential Information to any third party. Consultant agrees that
all Confidential Information will remain the sole property of the Company.
Consultant also agrees to take all reasonable precautions to prevent any
unauthorized disclosure of such Confidential Information. The Company and
Consultant will not directly or indirectly disclose to anyone the existence of
this Agreement or the fact that Consultant has this arrangement with the
Company, in any case except with the mutual agreement of the
parties.
5.3.
Former Client
confidential Information. Consultant agrees that
Consultant will not, during the term of this Agreement, improperly use or
disclose any proprietary information or trade secrets of any former or current
employer of Consultant or other person or entity with which Consultant has an
agreement or duty to keep in confidence information acquired by Consultant, if
any. Consultant also agrees that Consultant will not bring onto the Company's
premises any unpublished document or proprietary information belonging to any
such employer, person or entity unless consented to in writing by such employer,
person or entity.
5.4.
Third Party
Confidential Information. Consultant recognizes that the Company
has received and in the future will receive from third parties their
confidential or proprietary information subject to a duty on the Company's part
to maintain the confidentiality of such information and to use it only for
certain limited purposes. Consultant agrees that, during the term of this
Agreement and thereafter, Consultant owes the Company and such third parties a
duty to hold all such confidential or proprietary information in the strictest
confidence and not to disclose it to any person, firm or corporation or to use
it except as necessary in carrying out the Services for the Company consistent
with the Company's agreement with such third party.
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5.5.
Return
of Materials. Upon the termination of this Agreement, or upon Company's
earlier request, Consultant will deliver to the Company all of the Company's
property, including but not limited to all electronically stored information and
passwords to access such property, or Confidential Information that Consultant
may have in Consultant's possession or control.
6.
OWNERSHIP
6.1. Assignment.
Consultant agrees that all copyrightable material, notes, records,
drawings,
designs, inventions, improvements, developments, discoveries and trade secrets
conceived, discovered, developed or reduced to practice by Consultant, solely or
in collaboration with others, during the term of this Agreement that relate in
any manner to the business of the Company that Consultant may be directed to
undertake, investigate or experiment with or that Consultant may become
associated with in work, investigation or experimentation in the Company's line
of business in performing the Services under this Agreement (collectively,
"Inventions"), are the sole property of the Company. Consultant also agrees to
assign (or cause to be assigned) and hereby assigns fully to the Company all
Inventions and any copyrights, patents, mask work rights or other intellectual
property rights relating to all Inventions.
6.2.
Further
Assurances. Consultant agrees to assist Company, or its designee, at
the
Company's expense, in every proper way to secure the Company's rights in
Inventions and any copyrights, patents, mask work rights or other intellectual
property rights relating to all Inventions in any and all countries, including
the disclosure to the Company of all pertinent information and data with respect
to all Inventions, the execution of all applications, specifications, oaths,
assignments and all other instruments that the Company may deem necessary in
order to apply for and obtain such rights and in order to assign and convey to
the Company, its successors, assigns and nominees the sole and exclusive right,
title and interest in and to all Inventions, and any copyrights, patents, mask
work rights or other intellectual property rights relating to all Inventions.
Consultant also agrees that Consultant's obligation to execute or cause to be
executed any such instrument or papers shall continue after the termination of
this Agreement.
6.3.
Pre-Existing
Materials. Subject to Section 5. 1, Consultant
agrees that if, in the course of
performing the Services, Consultant incorporates into any Invention developed
under this Agreement any
pre-existing invention, improvement, development, concept, discovery or other
proprietary information owned by Consultant or in which Consultant has an
interest, (i) Consultant will inform Company, in writing before incorporating
such invention, improvement, development, concept, discovery or other
proprietary information into any Invention, and (ii) the Company is hereby
granted a nonexclusive, royalty-free, perpetual, irrevocable, worldwide license
to make, have made, modify, use and sell such item as part of or in connection
with such Invention. Consultant will not incorporate any invention, improvement,
development, concept, discovery or other proprietary information owned by any
third party into any Invention without Company's prior written
permission.
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6.4.
Attorney-in-Fact.
Consultant agrees that, if the Company is unable because of Consultant's
unavailability, dissolution, mental or physical incapacity, or for any other
reason, to secure
Consultant's signature for the purpose of applying for or pursuing any
application for any United States or foreign patents or mask work or copyright
registrations covering the Inventions assigned to the Company in Section 5.1,
then Consultant hereby irrevocably designates and appoints the Company and its
duly authorized officers and agents as Consultant's agent and attorney-in-fact,
to act for and on Consultant's behalf to execute and file any such applications
and to do all other lawfully permitted acts to further the prosecution and
issuance of patents, copyright and mask work registrations with the same legal
force and effect as if executed by Consultant
7.
PRIOR
OBLIGATIONS OF CONSULTANT
Consultant
represents and warrants to Company that Consultant is under no contract,
agreement or other obligation that will (A) prevent Consultant from giving any
information to Company which Consultant is to convey to Company hereunder in
performing the Services, (B)
prevent Company from receiving and using such information, (C) prevent
Company from receiving the benefit of Consultant's Services during the term of
this Agreement, or (D)
conflict with or prevent Consultant from performing any of its
obligations hereunder.
8.
CONFLICT
OF INTEREST
Both
Consultant and Company acknowledge that Consultant is in the business of providing
professional services to potential competitors of Company. As such, provided
Consultant discloses to the Company all such potential competitors, Company will
advise Consultant of those parties wherein there would be a conflict of interest
with certain types of assignments requested of Consultant by Company hereunder.
If such a conflict of interest exists at the time of this assignment, Consultant
will so acknowledge and Consultant will not proceed with the assignment due to
the existence of a conflict of interest.
9.
RELEASE
The
Consultant and Company each mutually agree to indemnify, defend and hold
harmless the other (and the other's parent company, affiliates, subcontractors
vendors, officers, directors, employees, agents, consultants and
representatives) from and against any and all claims, demands, suits,
liabilities, injuries (personal or bodily) causes of action, losses, expenses,
damages or penalties,
including without limitation court costs and reasonable attorneys' fees, to the
extent arising or resulting from the negligent acts or omissions of the
indemnifying party.
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10.
NONSOL1CITATION
From the
date of this Agreement until 12 months after the termination of this Agreement
(the "Restricted Period"), Consultant will not, without the Company's prior
written consent, directly or indirectly, solicit or encourage any employee or
contractor of the Company or its affiliates to terminate employment with, or
cease providing services to, the Company or its affiliates. During the
Restricted Period, Consultant will not, whether for Consultant's own account or
for the account of any other person, firm, corporation or other business
organization, intentionally interfere with any person who is or during the
period of Consultant's engagement by the Company was a partner, supplier,
customer or client of the Company or its affiliates.
11.
ARBITRATION
11.1.
Arbitration. Consultant
agrees that any and all controversies, claims or disputes with anyone (including
the Company and any employee, officer, director, shareholder or benefit plan of
the Company, in its capacity as such or otherwise) arising out of, relating to
or resulting from Consultant's performance of the Services under this Agreement
or the termination of this Agreement, including any breach of this Agreement,
shall be subject to binding arbitration under the Arbitration Rules set forth in
California. Code of Civil Procedure Section 1280 through 1294.2, including
Section 1283.05 (the "Rules") and pursuant to California law. CONSULTANT
AGREES TO ARBITRATE, AND THEREBY AGREES TO WAIVE ANY RIGHT TO A TRIAL BY JURY
WITH RESPECT TO, ALL DISPUTES ARISING FROM OR RELATED TO THIS AGREEMENT,
INCLUDING BUT NOT LIMITED TO: ANY STATUTORY CLAIMS UNDER STATE OR FEDERAL LAW,
CLAIMS UNDER TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, THE AMERICANS WITH
DISABILITIES ACT OF 1990, THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, THE
OLDER WORKERS BENEFIT PROTECTION ACT, THE FAMILY AND MEDICAL LEAVE ACT, THE
CALIFORNIA FAMILY RIGHTS ACT, THE CALIFORNIA FAIR EMPLOYMENT AND HOUSING ACT,
THE CALIFORNIA LABOR CODE, CLAIMS OF HARASSMENT, DISCRIMINATION OR WRONGFUL
TERMINATION AND ANY STATUTORY CLAIMS. Consultant understands that this Agreement
to arbitrate also applies to any disputes that the Company may have with
Consultant.
11.2.
Procedure. Consultant
agrees that any arbitration will be administered by the American Arbitration
Association ("AAA"), and that a neutral arbitrator will be selected in a manner
consistent with its National Rules for the Resolution of Employment Disputes
(the "National Employment Dispute Rules"). Consultant agrees that the arbitrator
will have the power to decide any motions brought by any party to the
arbitration, including discovery motions, motions for summary judgment and/or
adjudication and motions to dismiss and demurrers, prior to any arbitration
hearing. Consultant agrees that the arbitrator will issue a written decision on
the merits. Consultant also agrees that the arbitrator will have the power to
award any remedies, including attorneys' fees and costs, available under
applicable law. Consultant understands that the Company will pay for any
administrative or hearing fees charged by the arbitrator or AAA, except that
Consultant shall pay the first $125.00 of any filing fees associated with any
arbitration Consultant initiates. Consultant agrees that the arbitrator will
administer and conduct any arbitration in a manner consistent with the Rules, or
if judged applicable by the arbitrator, in a manner consistent with the National
Employment Dispute Rules. In instances of conflict, the National
Employment Dispute Rules shall take precedence.
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11.3.
Remedy.
Except as provided by the Rules, arbitration will be the sole, exclusive
and final remedy for any dispute between the Company and Consultant.
Accordingly, except as provided for by the Rules or National Employment Dispute
Rules, neither the Company nor Consultant will be permitted to pursue court
action regarding claims that are subject to arbitration.
11.4.
Availability
of Injunctive Relief. In addition to the right under the Rules to
petition the court for provisional relief, Consultant agrees that any party may
also petition the court for injunctive relief where either party alleges or
claims a violation of Sections 5 (Nondisclosure), 6 (Ownership) or 10
(Nonsolicitation) of this Agreement or any other agreement regarding trade
secrets, confidential information, or nonsolicitation. In the event either the
Company or Consultant seeks injunctive relief, the prevailing party will be
entitled to recover reasonable costs and attorneys' fees.
11.5
Administrative
Relief Consultant understands that this Agreement does not prohibit
Consultant from pursuing an administrative claim with a local, state or federal
administrative body such as the Department of Fair Employment and Housing, the
Equal Employment Opportunity Commission or the workers' compensation board. This
Agreement does, however, preclude Consultant from pursuing court action
regarding any such claim.
12. ASSIGNMENT
Neither
party may assign this Agreement, without the prior written consent of
the other party, except the Company may assign this Agreement to any
successor entity provided such entity agrees in writing
to be bound by the Company's obligations hereof This Agreement shall be binding
upon and inure to the benefit of, the successors and permitted assigns of the
parties hereto.
13. TERM
AND TERMINATION
13.1
Company agrees to retain Consultant for a period commencing on ", September 13,
2007 and ending on September 12, 2010, subject to earlier termination set forth
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13.2
Following the consummation of a reverse merger whereby the Company becomes a
publicly traded entity, in the event of a Change of Control (as defined below)
of the Company, this Agreement shall terminate and the Company shall pay the
Consultant all fees that are payable for the entire agreement per Section 4. In
addition, all of the then unreleased shares subject to outstanding RSPAs shall
be accelerated and fully released.
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For
purposes of this Agreement, "Change of Control" of the Company is defined as:
(i) any "person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as
amended) is or becomes the "beneficial owner" (as defined in Rule 13d-3 under
said Act), directly or indirectly, of securities of the Company representing 50%
or more of the total voting power represented
by the Company's then outstanding voting securities; (ii) the date of the
consummation of a merger or consolidation of the Company with any other
corporation that has been approved by the stockholders of the Company, other
than a merger or consolidation which would result in the voting securities of
the Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities of
the surviving entity) more than fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation; or (iii) the date of
the consummation of the sale or disposition by the Company of all or
substantially all the Company's assets.
13.3
Either party shall have the right to terminate this
Agreement in the event of a breach of a material provision of this Agreement by
the other party, upon one day written notification following the expiration of a
fifteen (15) day "Cure Period" during which time the offending party has not
cured such breach
(a)
In the
event of a material breach by "Company" that is not remedied within
the fifteen (15) day "Cure Period" then "Company" agrees to (i) pay the
"Consultant" within fifteen days all fees that are payable for the entire
agreement per Section 4 and (ii) all of the then unreleased shares subject to
outstanding RSPAs shall be accelerated and fully released.
(b)
In the
event of a material breach by "Consultant" that is not remedied within
the fifteen (15)
day "Cure Period" then "Company agrees to (i) pay the "Consultant" within
fifteen days all fees that are payable per Section 4 through the end of the
"Cure Period", and (ii) all of the then unreleased shares subject to outstanding
RSPAs shall stop being released pursuant to the applicable release schedules as
of the end of the "Cure Period".
14.
MISCELLANEOUS
14.1
This Agreement constitutes the entire Agreement between Company and Consultant
and no modifications thereto shall be binding unless such modifications are in a
written instrument executed by each of the respective parties stating the
parties mutual agreement as to (a)
change in the scope of the work, (b) the adjustment if any, in the charges, and
(c) the adjustment, if any, in the time for performing the work. This Agreement
supersedes all prior oral and written agreements and understandings between the
parties hereto on the same subject matter. In the event of any conflict between
the terms hereof and any Purchase Order(s) which may be issued by the Company in
support of Services hereunder, shall be governed by the terms of this
Agreement.
14.2
This Agreement shall he construed and enforced under the laws of the State of
California, without regard for conflict of law rules. In the event any provision
of this Agreement shall be held to be invalid or unenforceable, such provision
shall be separable from and shall not affect the validity or enforceability of
the remaining provisions of this Agreement.
14.3
Upon such termination of this Agreement, all rights and duties of the Company
and Consultant toward each other shall cease, however Section 3 (Independent
Contractor; Benefits), Section 5 (Nondisclosure), Section 6 (Ownership), Section
9 (Release), Section 10 (Nonsolicitation),
Section 11 (Arbitration and Equitable Relief), and Section 14 (Miscellaneous)
will survive termination of this Agreement.
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IN
WITNESS HEREOF, the parties do hereby agree to the full performance of this
Agreement effective as of the date set forth above.
| E4 LLC | |
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"Consultant"
By: /s/
Xxxxxx
Xxxxxxxx
Xxxxxx Xxxxxxxx
Date: 9/13/07
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"Company"
By: /s/
Xxxxxxx Londoner
Xxxxxxx Londoner
Date:
9/13/07
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