EXHIBIT 10.13
CONSULTING AGREEMENT
1. Parties
1.1. This consulting agreement (this "Agreement") is made and entered
into effective as of April 1, 1999 (the "Effective Date") by and between Mobile
PET Systems, Inc. (the "Company"), a Delaware corporation, with its principal
office located at suite 205, 0000 Xxxxxxx Xxxxxx Xxxxx, Xxx Xxxxx, Xxxxxxxxxx
00000, and Xxxxxx X. Xxxxx (the "Consultant"), a California resident, whose
address is Suite 500, 00000 XxxXxxxxx Xxxxxxxxx, Xxxxxxx Xxxxx, Xxxxxxxxxx
00000.
2. Recitals
2.1. The Company wishes to engage the services of the Consultant as an
independent contractor to perform the functions of chief financial officer of
the Company, and the Consultant wishes to except this engagement, on the terms
and subject to the conditions set forth in this Agreement.
2.2. In consideration of these premises and the mutual agreements set
forth below, the Company and the Consultant are entering into this Agreement.
3. Engagement
3.1. ENGAGEMENT. The Company hereby engages the services of the
Consultant, as an independent contractor, to perform the functions of the
Company's chief financial officer for the term set forth in paragraph 3.2 below,
and the Consultant hereby accepts this engagement.
3.2. TERM. The term of this engagement shall be for the two year period
beginning on April 1, 1999, and ending on March 31, 2001 (the "Term"), unless
sooner terminated as provided in paragraph 7.1 below.
3.2. RELATIONSHIP. The relationship between the Company and the
Consultant created by this Agreement is that of independent contractors, and the
Consultant is not and shall not be deemed to be an employee of the Company for
any purpose.
3.4. SERVICES. The services that the Consultant shall render to the
Company under this Agreement (the "Services") are and shall be limited to those
functions customarily performed by the chief financial officer of a company of
substantially the same size and in the same or similar business as the Company.
The Services do not include the functions of comptroller or treasurer.
3.5. TIME; NON-EXCLUSIVE. The Consultant shall devote as much time
to the performance of the Services as is reasonably necessary, which shall
not exceed (i) the Consultant being present at the Company's principal office
approximately two to three days per week (one of which shall include meetings
of the Company's board of directors) that the Consultant shall select, and
(ii) the Consultant being available at other reasonable and mutually
agreeable times, as may be needed, for
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consultation with the Company's chief executive officer. The Consultant is
not required to devote any fixed number of hours or days to the performance
of the Services. The Company recognizes that the Consultant has and will
continue to have other clients and business, and agrees that this engagement
is non-exclusive.
3.6. SUPPORT STAFF. The Company shall provide the Consultant with
reasonable support staff at the Company's principal office for the performance
of the Services, including an office and non-exclusive secretarial services.
4. Compensation and Expenses.
4.1. MONTHLY CASH COMPENSATION. The Company shall pay the Consultant
for the Services under this Agreement the sum of $7,500 per month during the
Term, in advance on the first day of each month beginning April 1, 1999.
4.2. STOCK GRANT. Contemporaneously with the execution of this
Agreement, the Company shall issue and deliver to the Consultant 100,000 shares
of the Company's common stock (the "Grant Shares"). The Consultant's right to
these shares shall be fully earned in consideration of his execution of this
Agreement, and shall vest on December 31, 1999. The Grant Shares shall be
unrestricted securities, or if they are restricted securities, then by August 1,
1999, the Company shall have either (i) filed and caused a registration
statement under the Securities Act of 1933 covering the Grant Shares to become
effctive, or (ii) exchanged the restricted Grant Shares for unrestricted shares
of the Company's common stock.
4.3. STOCK OPTION. Contemporaneously with the execution of this
Agreement, the Company shall execute and deliver to the Consultant a written
option (the "Option"), in the form of Exhibit A to this Agreement (with
appropriate insertions), to purchase 250,000 additional shares of the Company's
common stock (the "Option Shares"), at a price per share equal to the average
closing bid price of the Company's common stock quoted by Nasdaq on its OTC
Bulletin Board for the 5 trading days immediately preceding the Effective Date.
The Option shall be for a term of three years from the Effective Date.
4.4. OFFSET; WITHHOLDING; TAXES. The Company shall pay the cash
compensation to the Consultant provided in paragraph 4.1 above, and shall issue
and deliver the Grant Shares the Option and the Option Shares to the consultant,
all without offset, deduction or withholding of any kind or for any purpose. The
Consultant shall pay any federal, state and local income, social security,
Medicare, and similar governmental taxes payable by him with respect to the
compensation paid to him, by the Company pursuant to paragraphs 4.1, 4.2 and 4.3
of this Agreement, and shall indemnify the Company against and hold it harmless
from any such taxes.
4.5. EXPENSES. The Company shall pay, or shall promptly reimburse the
Consultant to the extent that he pays, all of the Consultant's expenses
reasonably incurred in his performance of the Services, including (by way of
example and not limitation) travel, lodging, meals, entertainment, telephone,
courier and delivery costs and charges. The Consultant shall submit
statements to the Company, in reasonable detail, for expenses for which he
claims reimbursement.
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5. Representations, Warranties and Covenants:
5.1. The Company represents and warrants to and covenants with the
Consultant that:
(a) INCORPORATION, GOOD STANDING, AND DUE QUALIFICATION. The
Company is a corporation duly incorporated, validly existing and in good
standing under the laws of the jurisdiction of its incorporation; has the
corporate power and authority to own its assets and to transact the
business in which it is now engaged and proposes to be engaged in; and is
duly qualified as a foreign corporation and in good standing under the laws
of each other jurisdiction in which such qualification is required.
(b) CORPORATE POWER AND AUTHORITY. The execution, delivery and
performance by the Company of this Agreement, including the issuance of the
Grant Shares and the Option, have been duly authorized by all necessary
corporate action and do not and will not (i) require any consent or
approval of the Company's shareholders; (ii) contravene the Company's
charter or bylaws; (iii) violate any provision of any law, rule,
regulation, order, writ, judgment, injunction, decree, determination or
award presently in effect having applicability to the Company; (iv) result
in a breach of or constitute a default under any agreement or other
instrument to which the Company is a party.
(c) LEGALLY ENFORCEABLE AGREEMENT. This Agreement is, and the
Option, when delivered under this Agreement will be, legal, valid and
binding obligations of the Company, enforceable against it in accordance
with their respective terms, except to the extent that such enforcement may
be limited by applicable bankruptcy, insolvency and other similar laws
affecting creditors' rights generally.
(d) THE SHARES. The Grant Shares are duly and validly issued,
fully paid and nonassessable. The Option Shares will be duly and validly
issued, and upon the payment of the purchase price therefore will be fully
paid and nonassessable.
(e) FINANCIAL STATEMENTS. The Company's financial statements for
its most recent two fiscal years, and from the end of its most recent
fiscal year to date, are true, accurate and complete in all material
respects, and have been prepared in accordance with generally accepted
accounting principles.
(f) COMPLIANCE WITH SECURITIES LAWS. All of the Company's
outstanding common stock, any outstanding rights, options, warrants and
agreements to acquire common stock of the Company, and any securities
issued by the Company that are convertible into common stock of the
Company, have been issued in material compliance with all applicable
federal and state securities laws and regulations. The Company has not
committed a material violation of any federal or state securities laws or
regulations applicable to it or to the issuance of any of its securities or
to trading or other transactions in any of its securities.
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6. Conditions Precedent.
6.1. The Consultant's obligation to perform this Agreement is subject
to the conditions precedent that the Company shall have issued and delivered the
Grant Shares and the Option to the Consultant.
7. Termination.
7.1. This Agreement may be terminated prior to the expiration of the
Term by either party:
(a) By giving the other not less than 60 days' prior notice of
its election to do so; or
(b) By giving the other party written notice of its election to do
so, if any representation or warranty of the other party contained in this
Agreement is materially inaccurate as of the Effective Date, or if the
other party (i) has breached any warranty, covenant or other provision of
this Agreement in any material respect; or (ii) has committed an unlawful
act or gross negligence or wilful misconduct in the performance of this
Agreement.
7.2. The Option, and the Consultant's right to exercise the same, shall
survive the termination of this Agreement.
8. General Provisions.
8.1. ENTIRE AGREEMENT; MODIFICATION; WAIVERS. This Agreement contains
the entire agreement of the parties, and supersedes any prior agreements with
respect to its subject matter. There are no agreements, understandings or
arrangements of the parties with respect to the subject matter of this Agreement
that are not contained herein. This Agreement shall not be modified except by an
instrument in writing signed by the parties. No waiver of any provision of this
Agreement shall be effective unless made in writing and signed by the party
making the waiver. The waiver of any provision of this Agreement shall not be
deemed to be a waiver of any other provision or any future waiver of the same
provision.
8.2. NOTICES. All notices given under this Agreement shall be in
writing, addressed to the parties as set forth below, and shall be effective on
the earliest of (i) the date received, or (ii) if given by facsimile transmittal
on the date given if transmitted before 5:00 p.m. the recipient's time,
otherwise it is effective the next day, or (iii) on the second business day
after delivery to a major international air delivery or air courier service
(such as Federal Express or Network Couriers):
IF TO THE COMPANY: IF TO THE CONSULTANT:
Mobile PET Systems, Inc. Xx. Xxxxxx X. Xxxxx
0000 Xxxxxxx Xxxxxx Xxxxx Xxxxx 000 Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000 00000 XxxXxxxxx Xxxxxxxxx
Attention: Mr. Xxxx Xxxxx Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
President and CEO Facsimile: (000) 000-0000
Facsimile No. 000 000 0000
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8.3. INDEMNIFICATION. The Company, for itself and its shareholders,
directors, officers, employees, agents, affiliates, predecessors and successors
in interest (collectively, the "Indemnifying Parties"), hereby agrees to
indemnify the Consultant and his employees, agents, affiliates, predecessors and
successors in interest (collectively, the "Indemnified Parties"), and hold each
of them harmless from and against, any liability, damage, claim (whether or not
well-founded) and expense (including reasonable attorneys' fees), whether in
tort or in contract, or both, arising out or in any way related or incidental to
(i) the acts or omissions of any Indemnifying Party, and (ii) the acts and
omissions of any Indemnified Party in the performance of this Agreement, except
for such Indemnified Party's gross negligence or wilful misconduct. The
provisions of this paragraph 8.3 shall survive the termination of this
Agreement.
8.4. DISPUTE RESOLUTION. Any controversy or claim arising out of or
relating to this Agreement (whether in contract or tort, or both) shall be
determined by binding arbitration at Newport Beach, California, in accordance
with the commercial arbitration rules of the American Arbitration Association,
by a panel of three arbitrators, one chosen by each of the parties and the third
by the two so chosen. If the two arbitrators cannot agree on a third, then the
third shall be appointed in accordance with such rules. The prevailing party in
any arbitration proceeding shall be awarded reasonable attorneys fees and costs
of the proceeding. The arbitration award shall be final, and may be entered in
and enforced by any court having jurisdiction.
8.5. LAW GOVERNING. This Agreement shall be construed and enforced in
accordance with the laws California
8.6. BINDING EFFECT. This Agreement shall be binding on, and shall enure
to the benefit of the parties and their respective successors in interest.
8.7. CONSTRUCTION, COUNTERPARTS. This Agreement shall be construed as a
whole and in favor of the validity and enforceability of each of its provisions,
so as to carry out the intent of the parties as expressed herein. Heading are
for the convenience of reference, and the meaning and interpretation of the text
of any provision shall take precedence over its heading. This Agreement may be
signed in one or more counterparts, each of which shall constitute an original,
but all of which, taken together shall constitute one agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
date set forth after their respective signatures, effective as of the Effective
Date
THE COMPANY: THE CONSULTANT:
Mobile PET System, Inc.
By /s/ Xxxx Xxxxx /s/ Xxxxxx X. Xxxxx
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Xxxx Xxxxx, President and CEO Xxxxxx X. Xxxxx
Date signed 3/26/99 Date signed 3/26/99
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