CONSULTING AGREEMENT
This CONSULTING AGREEMENT (this "Agreement"), dated as of February
27, 1998 by and between XXXXXXXX XXXXX, M.D. ("Consultant"), an individual
having an address at 0 Xxxxxx Xxxxx, Xxxxx Xxxxx, Xxx Xxxxxx 00000, and
HEALTHCARE IMAGING SERVICES, INC., a Delaware corporation (the "Company"), with
its principal place of business at Tri-Parkway Corporate Park, 000 Xxxxxx Xxxxx,
Xxx Xxxx, Xxx Xxxxxx 00000.
W I T N E S S E T H :
WHEREAS, the Company desires to become a leading provider of
physician practice management services to an integrated network of physicians in
New Jersey offering a comprehensive array of primary care, multi-specialty and
diagnostic imaging services;
WHEREAS, in furtherance of its strategy to establish physician
practice management operations the Company is contemporaneously herewith
entering into a letter of intent (the "LOI") with Pavonia Medical Associates,
P.A. ("Pavonia") which sets forth the principal terms and conditions upon which
the Company or a subsidiary will enter into an agreement to acquire the capital
stock of Jersey Integrated HealthPractice, Inc., a management service
organization established and owned principally by Pavonia; and
WHEREAS, the Company desires to engage Consultant to provide
consulting services and expertise to the Company in connection with the
Company's development of its physician practice management operations, and
Consultant desires to provide such services, upon the terms and subject to the
conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and mutual
covenants contained herein and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties hereto hereby
agree as follows:
1. Appointment as Consultant. The Company hereby appoints Consultant
as an independent contractor, and Consultant hereby accepts such appointment by
the Company, commencing on the date hereof (the "Effective Date"), for the Term
(as defined below), with the obligations set forth in Section 3 below, and upon
the other terms and subject to the conditions hereinafter stated.
2. Term. Except as otherwise specifically provided in Section 6
below, the term of the Agreement (the "Term") shall commence on the Effective
Date and shall continue until the first (1st) anniversary of the Effective Date,
subject to the terms and conditions of this Agreement; provided however, that
the Agreement shall terminate upon the earlier to occur of the following: (i)
the negotiation and execution of an employment agreement between the
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Company and Consultant on terms and conditions satisfactory to the parties
thereto (the "Employment Agreement") or (ii) the expiration or termination of
this Agreement pursuant to the terms hereof.
3. Obligations as Consultant. During the Term, (a) Consultant shall
provide to the Company such services as are reasonably requested by the Company
from time to time in connection with the Company's development and marketing of
its physician practice management operations, and (b) Consultant shall devote
such working time, attention and energies to the affairs of the Company during
the Term as shall be necessary to provide the consulting services set forth
herein; provided however, that the provision of such services shall not
materially interfere with Consultant's current responsibilities as the Chief
Executive Officer of Pavonia. Consultant shall be subject to the supervision of
the Company's Chairman of the Board, Chief Executive Officer and President. All
consulting activities under this Agreement shall be performed personally by
Consultant, and Consultant shall not engage any other person, entity or group to
perform such activities without the Company's prior written consent.
4. Compensation. In consideration for the services provided by
Consultant pursuant to this Agreement and contemplated to be rendered pursuant
to the Employment Agreement, the Company hereby agrees to grant to Consultant an
option to purchase 300,000 shares of common stock, par value of $.01 per share,
of the Company (the "Option") pursuant to the terms and conditions of the Stock
Option Agreement attached hereto as Exhibit A; provided however, that the Option
shall in no event be exercisable until Consultant has become a full-time
employee of the Company.
5. Expenses. During the Term, the Company shall reimburse Consultant
for any reasonable out-of-pocket expenses incurred by Consultant at the request
of the Company in connection with the consulting services provided under this
Agreement.
6. Termination. Either party may, upon 30 days prior written notice
to the other, terminate this Agreement.
7. Confidential Information.
(a) Consultant agrees not to use, disclose or make accessible
to any person, entity or group any Confidential Information (as defined below)
pertaining to the business of the Company and/or any of its affiliates, except
when required to do so by a court of competent jurisdiction, by any governmental
agency having supervisory authority over the business of the Company, or by any
administrative body or legislative body (including a committee thereof) with
jurisdiction to order Consultant to divulge, disclose or make accessible such
information. For purposes of this Agreement, "Confidential Information" means
any non-public information concerning the Company's and/or any of its
affiliates' financial data, statistical data, strategic business plans, pricing
or pricing strategies, customer and supplier lists, customer and supplier
information, information relating to governmental relations, practices,
processes,
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methods, trade secrets, marketing plans and other non-public, confidential
information of the Company and/or any of its affiliates, that, in any case, is
not otherwise generally available to the public.
(b) In the event this Agreement expires or is terminated,
Consultant shall immediately return to the Company all Confidential Information
in his possession.
(c) Consultant and the Company agree that the covenant
regarding Confidential Information contained in this Section 7 is a reasonable
covenant under the circumstances, and further agree that if, in the opinion of
any court of competent jurisdiction, such covenant is not reasonable in any
respect, such court shall have the right, power and authority to excise or
modify such provision or provisions of this covenant as to the court shall
appear not reasonable and to enforce the remainder of the covenant as so
amended.
(d) Consultant acknowledges that the consideration received,
and to be received, by him under this Agreement adequately and sufficiently
compensates him for the restrictions set forth in this Section 7.
(e) The provisions of this Section 7 shall extend for the Term
and shall survive the expiration or termination of the Agreement for a period of
three (3) years.
8. Remedy for Breach. Consultant hereby acknowledges that, in the
event of any breach of Section 7 of this Agreement, the Company would have no
adequate remedy at law and would suffer substantial and irreparable damage.
Accordingly, Consultant hereby agrees that, in such event, the Company shall be
entitled, without the necessity of proving damages or posting bond, and
notwithstanding any election by the Company to claim damages, to obtain a
temporary and/or permanent injunction (without proving a breach therefor) to
restrain any such breach or threatened breach or to obtain specific performance
of any such provisions, all without prejudice to any and all other remedies that
the Company may have at law or in equity.
9. Representations of Consultant. Consultant hereby represents and
warrants to the Company the following:
(i) neither the execution and delivery of this Agreement by
Consultant, the consummation of the transactions required of Consultant herein,
nor the fulfillment of, or compliance with, the terms and conditions of this
Agreement, will conflict with, or result in, with or without the giving of
notice or the passage of time or both, a breach of any of the terms, conditions
or provisions of any agreement or instrument to which Consultant is now a party
or by which he or his property is bound or subject or constitute a default or
result in an acceleration under any of the foregoing, or result in the creation
of any liens, claims or encumbrances on any assets of Consultant or the
violation of any law, rule, regulation, order, judgment or decree to which his
property is subject;
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(ii) Consultant is aware of the Anti-Fraud and Abuse
Amendments to the Social Security Act, the Medicare and Medicaid Program
Protection Act and the Federal Safe Harbor Regulations, and that, as a
consultant, he cannot knowingly or willfully offer, pay, solicit or receive
remuneration in order to induce business, and if he does so, he will be subject
to civil and/or criminal penalties;
(iii) Consultant has reviewed and executed the Company's
Statement of Policy for Contractors and Consultants attached hereto; and
(iv) Consultant will not enter into any contractual or other
arrangement, which is inconsistent with the performance of his obligations
pursuant to Section 3 herein.
10. Miscellaneous.
(a) Relationship of the Parties. In performing the services
provided for hereunder, Consultant is acting as an independent contractor, and
Consultant shall not be deemed by virtue of this Agreement to be the servant,
agent or employee of the Company for any purpose whatsoever. Consultant
understands that, as an independent contractor, he shall not be entitled, as a
result of the services to be provided by him hereunder, to receive any employee
benefits from, or participate in any employee benefit plans sponsored by, the
Company.
(b) Notices. Any notice or other communication permitted or
required to be given or made hereunder shall be in writing and shall be deemed
to be sufficiently and duly given or made if sent by hand delivery or by
telecopier (with confirmation of receipt) or if sent by registered or certified
mail (postage prepaid and return receipt requested), or if sent by reputable
overnight courier or express mail, to the addressee as follows:
If to the Company, to:
Healthcare Imaging Services, Inc.
Tri-Parkway Corporate Park
000 Xxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
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If to Consultant, to:
Xxxxxxxx Xxxxx, M.D.
c/o Pavonia Medical Associates, P.A.
000 Xxxxxxx Xxx.
Xxxxxx Xxxx, Xxx Xxxxxx 00000
Tel: (000)000-0000
Fax: (000)000-0000
Notice shall be deemed effective when so personally delivered, telecopied, or if
mailed, 2 business days following the date the notice is mailed, or if sent by
overnight courier or express mail, the next business day following the date the
notice is sent. Any party may by notice given in accordance with this Section to
the other party designate another person or address for receipt of notices
hereunder.
(c) Entire Agreement; Amendment; Construction. This Agreement
constitutes the entire agreement and understanding between the parties
pertaining to the subject matter hereof and supersedes all prior agreements and
understandings between the parties hereto with respect to the subject matter
hereof, whether oral or written. Any amendment to this Agreement shall be made
only upon the written consent of Consultant and a duly authorized officer of the
Company. The language used in this Agreement shall be deemed to be the language
chosen by the parties hereto to express their mutual intent, and no rule of
strict construction shall be applied against any party. Accordingly, the
language of all parts of this Agreement shall at all times be construed as a
whole, allowing for a fair reading, and not strictly construing such language
for or against any of the parties to this Agreement. Furthermore, it is
acknowledged and agreed by each of the parties to this Agreement that each of
the parties participated in the drafting of this Agreement, and any time any
claims arise concerning such language, such language shall not be construed for
or against the party alleged to be responsible for such drafting.
(d) No Waivers. No failure or delay by any party in exercising
any right, power or privilege under this Agreement shall operate as a waiver
thereof nor shall any single or partial exercise thereof preclude any other
further exercise thereof or the exercise of any other right, power or privilege.
The rights and remedies provided in this Agreement shall be cumulative and not
exclusive of any rights or remedies provided by any law, rule, regulation or
order.
(e) Severability. This Agreement shall be deemed to be
severable and the invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement. Furthermore, in lieu of any such invalid or unenforceable
provision, the parties hereto intend that there shall be added as a part of this
Agreement a provision as similar in terms to such invalid or unenforceable
provision as possible to be valid and enforceable.
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(f) Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their permitted
successors and assigns. However, Consultant shall not assign any of its rights
or obligations under this Agreement (whether by operation of law or otherwise),
in whole or in part, without the prior written consent of the Company, which the
Company may grant or withhold in its sole discretion.
(g) Governing Law. This Agreement shall be construed and
governed in accordance with the laws of the State of New Jersey, without any
regard to the conflicts-of-law principles thereof.
(h) Titles. Titles contained in this Agreement are intended
solely for convenience of the parties hereto, and no provision of this Agreement
is to be construed by reference to any such Title.
(i) Counterparts. This Agreement may be executed in multiple
counterparts, each of which when so executed and delivered shall be an original,
but all of such counterparts shall together constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have duly executed and
delivered this Agreement as of the date first written above.
HEALTHCARE IMAGING SERVICES, INC.
By:/s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title:Chairman of the Board, President
and Chief Executive Officer
/s/ Xxxxxxxx Xxxxx
Xxxxxxxx Xxxxx, M.D.
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