CONSULTING SERVICES AGREEMENT
THIS CONSULTING SERVICES AGREEMENT ("Agreement") is entered
into as of the 17th day of December, 2004, between M. Xxxxx Xxxxxxxx,
(hereinafter referred to as "Consultant") and Thoratec Corporation, a California
corporation (hereinafter referred to as "Thoratec").
RECITALS
Consultant was previously an employee and executive officer of
Thoratec and an officer and director of certain of its subsidiaries.
Thoratec and Consultant are defendants in certain shareholder
and derivative law suits which have been brought in connection with events that
occurred during Consultant's period of employment with Thoratec and of which
Consultant has certain direct knowledge.
Thoratec and Consultant desire to enter into this Agreement
under which Consultant will provide consulting services and cooperation in
connection with such litigation or any other related litigation or disputes that
may subsequently be brought arising out of events that occurred during the
period that Consultant was employed by Thoratec.
Now, therefore, for good and valuable consideration, the
receipt and adequacy of which is hereby acknowledged by the parties hereto, such
parties hereby agree as follows:
AGREEMENT
The parties hereto agree as follows:
1. CONSULTING SERVICES. Consultant will provide all reasonable
and necessary assistance and cooperation to Thoratec's legal counsel and other
retained professionals (the "Services") with respect to (a) the federal
shareholder class action lawsuit currently pending in the U.S. District Court
for the Northern District of California, (b) the shareholder derivative lawsuit
currently pending in the Superior Court of the State of California, County of
Alameda, and (c) any other lawsuits, investigations or administrative
proceedings that may occur arising out of the financial reporting or other
activities of Thoratec similar to those that are the subject of the claims in
items (a) and (b) herein above, during the period when Consultant was an
employee of Thoratec ((a) through (c), inclusive, being referred to herein as
the "Proceedings"). The Services shall include, without limitation, Consultant
making himself available, at times and places reasonably convenient for
Consultant and Thoratec's counsel, for depositions, interviews, preparation and
review of affidavits, interrogatories and discovery materials, investigative
assistance, and all such other matters as shall be necessary or in the opinion
of counsel to Thoratec useful for the defense of Thoratec in connection with the
Proceedings. Consultant shall provide the Services described in this Section 1
in a good faith and professional manner consistent with the role of an executive
officer which Consultant held while an employee of Thoratec.
2. CONSIDERATION. As full and complete consideration for the
Services to be
rendered hereunder and pursuant to the Restated and Amended Thoratec Corporation
Restricted Stock Grant Agreement, dated as of the date hereof and in
substantially the form attached hereto as Exhibit A (the "Restated and Amended
Restricted Stock Grant Agreement"), Consultant shall retain twenty five thousand
(25,000) restricted shares of Thoratec common stock pursuant to Thoratec's 1997
Employee Stock Option Plan, as amended (the "Restricted Shares"). The rights and
lapsing of restrictions of such Restricted Shares shall be as set forth in the
Restated and Amended Restricted Stock Grant Agreement.
3. RENDITION OF INVOICES FOR EXPENSES. Thoratec shall
reimburse Consultant's reasonable expenses incurred in the performance of the
Services upon the submission by Consultant of a "Statement of Business
Expenses," which is substantiated by proper invoices or copies of backup
documents and is approved by Thoratec's counsel. The Statement should be
forwarded to Thoratec at 0000 Xxxxxxxxxx Xxxxx, Xxxxxxxxxx XX 00000, ATTN:
General Counsel.
4. TERM AND TERMINATION.
(a) Term and Termination. This Agreement shall be in
effect for the Initial Period of three (3) years unless earlier terminated in
accordance with the provisions hereof. This Agreement is subject to termination
by either party upon the following events and in the following time frames:
(i) By Consultant for any reason upon thirty (30) days
prior written notice to Thoratec;
(ii) By Consultant, upon fourteen (14) days prior
written notice to Thoratec, for a breach of this
Agreement by Thoratec, which thereafter has not
been cured within thirty (30) days after notice of
such breach to Thoratec;
(iii) By Thoratec for any reason upon thirty (30) days
prior written notice to Consultant;
(iv) By Thoratec, upon fourteen (14) days prior written
notice to Consultant, for a breach of this
Agreement by Consultant, which has not been cured
within thirty (30) days after notice of such
breach to Consultant; or
(v) Immediately and automatically upon the entering of
a final, non-appealable, adjudication by the
relevant court or authority or settlement and
dismissal with prejudice of all of the
Proceedings.
(b) Effects of Termination. In the event of
termination of this Agreement, Consultant's rights to the Restricted Stock shall
be determined in accordance with the terms of the Restated and Amended
Restricted Stock Grant Agreement.
5. TITLE TO DATA AND PROPERTY PRODUCED; WORK PRODUCT
PRIVILEGE. Consultant agrees that all data, analyses, graphs, reports, physical
property, documents or other subject matter prepared, procured or produced by
Consultant in the performance of this Agreement shall be privileged and
confidential work product prepared at the request of, and for the assistance of,
Thoratec's counsel, and is the sole property of Thoratec's counsel ("Work
Product"). All such Work Product may be used by Thoratec's counsel without
accounting therefor to Consultant; provided, however, that nothing herein shall
affect, limit or waive the attorney-client privilege attaching to communications
between Consultant and Thoratec's counsel in Consultant's capacity as a
defendant in any of the Proceedings, or in connection with any other threatened
claim
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or proceeding.
6. DISCLOSURE OF CONFIDENTIAL INFORMATION. Consultant agrees
neither to use nor disclose to any third party any Work Product as defined
herein, or any proprietary, confidential or trade secret information relating to
the financial, business or technical work or products of Thoratec, its methods,
processes, tools, machinery, formulae, drawings, or appliances which has been
acquired by Consultant in the course of his Services hereunder ("Confidential
Information"), except to the extent required by law and otherwise only as may be
authorized by Thoratec's counsel and an authorized officer of Thoratec. This
restriction on disclosure or use of Confidential Information also shall extend
to any agent of Consultant participating in the rendition of the Services. The
provisions of this paragraph shall survive the termination of this Agreement and
remain in effect until such time as said Confidential Information enters the
public domain other than through Consultant or the agents of Consultant.
7. CONFLICTING INTERESTS. Upon execution of this Agreement,
Consultant agrees to apprise Thoratec's counsel in writing of any firm competing
with or in the business of mechanical circulatory support or point of care
diagnostic testing in which Consultant has any direct ownership interest,
affiliations, or other personal business relationships ("Conflicting
Interests"). In the event Consultant, during the term of this Agreement,
acquires any such Conflicting Interests, Consultant agrees to promptly so notify
Thoratec's counsel in writing. Notwithstanding anything in this paragraph 7 to
the contrary, the parties agree that the existence of a Conflicting Interest
shall not constitute a breach of this Agreement within the meaning of paragraph
4(a)(iv) of this Agreement.
8. ASSIGNMENT Performance of the Services is personal to
Consultant and he shall not hire anyone to perform any of the Services in his
place. Consultant is hereby prohibited from any and all subcontracting or
assignment of this Agreement, by operation of law or otherwise, and any attempt
by Consult to subcontract or assign this Agreement shall be void.
9. NOTICE. Any notice required or permitted to be given or
made under this Agreement by either of the parties to the other will be in
writing, delivered personally or by facsimile (and promptly confirmed by
personal delivery, first class mail or courier), first class mail or courier,
postage prepaid (where applicable), addressed to such other party at the
following addresses:
If to Thoratec:
Thoratec Corporation
0000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Attn: General Counsel
Telephone Number: (000) 000-0000
Facsimile Number: (000) 000-0000
If to Consultant:
M. Xxxxx Xxxxxxxx
*
*
Telephone Number: *
Facsimile Number: ____________
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Any notice required or permitted to be given or made
under this Agreement will be effective and deemed
given under this Agreement on the earliest of: (a)
the date of personal delivery; (b) the date of
delivery by facsimile; or (c) the next business day
after deposit with a nationally-recognized courier or
overnight service, including FedEx or Express Mail.
10. WHOLE AGREEMENT. This Agreement represents the entire
understanding and agreement concerning the Services. Each of the parties hereto
shall from time to time and, at all times, do all further acts and execute and
deliver all such further documents and assurances as may be reasonably required,
in order to fully perform and carry out the terms of this Agreement. For the
avoidance of doubt, nothing in this Agreement shall constitute a waiver of
either party's rights under the Indemnification Agreement between the parties
dated as of August 6, 2001.
11. INDEPENDENT CONTRACTOR. Consultant agrees that his status
shall be that of an independent contractor without the capacity to bind Thoratec
legally and not that of a partner or an agent or employee. It is further
specifically agreed that Thoratec will not be liable for any injuries or damages
incurred by Consultant or arising through his activities.
12. GOVERNING LAW; VENUE. This Agreement will be deemed to
have been entered into and will be construed and enforced in accordance with the
laws of the State of California without regard to principles of conflicts of
laws. The parties hereby agree to submit to the exclusive jurisdiction of the
courts of the State of California and the Federal courts of the United States of
America located within the County of Alameda in the State of California for any
action to enforce this Agreement. If either party brings an action to enforce
the terms of this Agreement, the prevailing party shall be entitled to
reasonable attorneys' fees and costs.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
THORATEC CORPORATION,
a California Corporation
By: /s/ D. Xxxxx Xxxxxxxx
_____________________
D. Xxxxx Xxxxxxxx
Chief Executive Officer and President
CONSULTANT
/s/ M. Xxxxx Xxxxxxxx
______________________
M. Xxxxx Xxxxxxxx
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