EXHIBIT 10.4
EXHIBIT 2
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT ("Agreement"), dated as of this 9th day of
October, 2002 is made by and between Seradyn, Inc., a Delaware corporation (the
"Company"), and Opus Diagnostics, Inc. (the "Consultant").
WHEREAS, the Company acquired substantially all of the assets of Opus
Diagnostics, Inc. ("Seller") pursuant to a Purchase and Sale Agreement dated as
of October 9, 2002 (the "Purchase Agreement"); and
WHEREAS, Xxxxxx Xxxxx is the President and a director of the Consultant,
and has substantial knowledge and expertise with respect to the business that
was purchased by the Company from the Seller which includes the development,
distribution, and sale of diagnostic assays, controls and calibrators for
therapeutic drug monitoring (the "Business");
WHEREAS, the Company desires to retain the knowledge and skill of Xx. Xxxxx
regarding such Business through the engagement of the Consultant for the period
provided in this Agreement; and
WHEREAS, the Consultant desires to provide consulting services to the
Company in accordance with the terms of this Agreement.
NOW, THEREFORE, in consideration of the mutual promises herein set forth,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, it is hereby agreed as follows:
1. Engagement of the Consultant. The Company does hereby appoint and
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engage the Consultant as its consultant and advisor, and the Consultant hereby
accepts its appointment and engagement by the Company with respect to the
matters described in paragraph 3 hereof for the compensation set forth in
paragraph 4 hereof.
2. Term. This Agreement shall be effective as of October 9, 2002 (the
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"Effective Time") and shall continue in full force and effect until October 9,
2004, unless sooner terminated as hereinafter set forth (the "Term"). The Term
may be extended for one additional year upon the written agreement of the
Company and the Consultant.
3. Services of the Consultant. During the Term of this Agreement, the
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Consultant shall make Xx. Xxxxx available to provide consulting services (the
"Services") to the Company, subject to Xx. Xxxxx'x prior obligations as an
officer of the Consultant. The Services shall include, but not be limited to,
assistance in maintaining and enhancing relationships with customers of the
Business, including making customer contacts on behalf of the Company,
scheduling and attending customer meetings, participating in presentations to
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customers and such other matters as the Company may reasonably request. The
Consultant shall make Xx. Xxxxx available to perform not more than 30 (thirty)
hours of the Services per month, including travel time, on a non-cumulative
basis. The Company shall provide at least five (5) days' prior notice to the
Consultant of any proposed out-of-town travel.
4. Compensation and Expenses.
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(a) As full and complete compensation for any and all Services
rendered by the Consultant to the Company and for the restrictive covenants
provided in paragraph 6 hereof, the Company shall pay the Consultant an annual
fee of Fifty Thousand and 00/100 Dollars ($50,000.00). Such fee shall be payable
in arrears in equal monthly installments on the last business day of each month.
(b) During the Term of this Agreement, the Company shall pay or
reimburse the Consultant for all reasonable, necessary and pre-approved
traveling, entertainment, telephone, and other expenses paid or incurred by the
Consultant in connection with the performance of the Services provided under
this Agreement. Such payment or reimbursement by the Company to the Consultant
shall be conditioned upon the Consultant presenting related expense statements,
vouchers, or other evidence of expense to the Company and any reimbursement
shall be made within thirty (30) days after the expense information has been
submitted to the Company.
5. Termination. The Consultant's engagement hereunder may be terminated
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by the Company prior to the expiration of the Term in the event of
Xx. Xxxxx'x death, disability or termination with the Consultant with there
being no replacement acceptable to the Company or upon the material breach of
this Agreement by the Consultant.
6. Covenant Not To Compete.
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(a) Competition. Except for the performance of the Services under
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this Agreement, the Consultant and Xx. Xxxxx agree that during the Term and for
a period of six (6) months thereafter, they shall not, directly or indirectly,
within the Territory described below:
(i) engage in, continue in or carry on any business which
competes with the Business or a business substantially similar thereto,
including owning or controlling any financial interest in any corporation,
partnership, firm or other form of business organization which is so engaged;
(ii) consult with, advise or assist in any way, whether or not
for consideration, any corporation, partnership, firm or other business
organization which is now or becomes a competitor of the Company in any aspect
with respect to the Business including, but not limited to, advertising or
otherwise endorsing the products of any such competitor; soliciting customers or
otherwise serving as an intermediary for any such competitor; and loaning money
or rendering any other form of financial assistance to or engaging in any
similar form of business transaction with any such competitor;
(iii) hire, offer to hire, or solicit for employment any employee
of the Company or any Affiliate without the prior consent of the Company or such
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Affiliate, as the case may be, until such person has been separated from
employment by the Company or the Affiliate for at least ninety (90) days, except
for solicitations to the general public (e.g. newspaper advertisements); or
(iv) engage in any practice the purpose of which is to evade the
provisions of this covenant not to compete;
provided, however, the foregoing prohibition does not extend to passive
ownership of less than 1% of the outstanding stock of any entity whose
stock is traded on an established stock exchange or quoted on the NASDAQ
stock exchange.
For purposes hereof, "Territory" is defined as any county or similar
geographic subdivision in New Jersey, the United States, North America and the
World. The parties intend that this noncompete covenant shall be construed as
separate covenants, one for each county or other subdivision to which the
covenant applies. In the event a court of competent jurisdiction determines that
the provisions of this covenant not to compete are excessively broad as to
duration, geographic scope or activity, it is expressly agreed that this
covenant not to compete shall be construed so that the remaining provisions
shall not be affected, but shall remain in full force and effect, and any such
over broad provisions shall be deemed, without further action on the part of any
person, to be modified, amended and/or limited, but only to the extent necessary
to render the same valid and enforceable in such jurisdiction.
(b) Exception. It shall not be a violation of Section 6(a) above if:
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(i) The Consultant develops, commercializes, licenses or sells
any products which are the subject of the Royalty Agreement (as defined in the
Purchase Agreement) which revert to the Consultant pursuant to Section 4 of the
Royalty Agreement.
(ii) Xx. Xxxxx accepts employment with a business entity which is
diversified and made up of separate divisions and which, as to part of its
business, is not engaged in the Business or a business substantially similar
thereto, as long as Xx. Xxxxx does not, directly or indirectly, render any
services to that division or part of such business entity which is engaged in
the Business or a business substantially similar thereto.
(iii) The Consultant acquires another business or entity (a
"Target") where less than ten percent (10%) of the gross revenues of the Target
in its most recently completed fiscal year are derived from activities in the
Business or a business substantially similar thereto as long as: (A) if the
Company desires to purchase that portion of the Target which is engaged in the
Business or a business substantially similar thereto, the Consultant negotiates
in good faith with the Company to sell such portion of the Target to the Company
and (B) if the Consultant does not sell such portion of the Target to the
Company pursuant to subsection (A), prior to selling such portion of the Target
to a third party, the Consultant shall provide the Company with a copy of any
contract or agreement by which the third party proposes to purchase such portion
of the Target and the Company shall have twenty (20) days after receipt thereof
in which to exercise a right of first refusal to purchase such portion of the
Target on the terms and conditions set forth in such contract or agreement.
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(c) Confidential Information. During the course of the provision of
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the Services hereunder, the Consultant and Xx. Xxxxx acknowledge that they will
continue to produce and have access to, material records, data, trade secrets
and information not generally available to the public regarding the Company, the
Affiliates and the Business ("Confidential Information"). Therefore, during the
Term of this Agreement and thereafter, so long as the information continues to
be Confidential Information, the Consultant and Xx. Xxxxx, shall hold in
confidence and not directly or indirectly disclose, use, copy or make lists of
any such Confidential Information, except to the extent required by any court or
administrative agency, other than to an employee of the Company or any person to
whom disclosure is reasonably necessary or appropriate in connection with the
performance by the Consultant of its duties hereunder. All records, files,
documents, and other materials or copies thereof relating to the Company's
business (or that of any Affiliate) which the Consultant or Xx. Xxxxx shall
prepare or use or come into contact with shall be and remain the sole property
of the Company or such Affiliate, as the case may be, shall not be removed from
the Company's or such Affiliate's premises without written consent, and shall be
promptly returned to the Company or such Affiliate upon termination of this
Agreement.
7. Inventions.
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(a) The Consultant shall promptly disclose to the Company any
invention, method, process, equipment, formula, information, discovery, or
copyrightable materials, and improvement to any of the foregoing, made, created,
conceived, developed or discovered by Consultant or Xx. Xxxxx either alone or in
concert with others, while this Agreement is in effect or during the six (6)
month period following termination of this Agreement, which relates or is
anticipated to relate to the business, research and development activities or
investigations of the Company or an Affiliate, or which results from or is
suggested by any of the Services provided by the Consultant for or on behalf of
the Company or an Affiliate, whether they are patentable or unpatentable,
whether made, created, conceived, developed or discovered alone or in
conjunction with others, and whether or not made, created, conceived, developed
or discovered during hours of the provision of the Services, through use of the
Company's or an Affiliate's facilities, materials, or personnel (all of the
foregoing collectively referred to as "Inventions").
(b) All Inventions shall be and remain the sole and exclusive
property of the Company and the Consultant hereby assigns all interest in any
and all Inventions to the Company. The Company shall have the right, without
payment or royalty or other compensation to the Consultant, to use, obtain
patents for, assign, license, sell and otherwise deal with any and all
Inventions. Upon request made at any time, the Consultant and Xx.Xxxxx
shall promptly execute, acknowledge and deliver any and all assignments,
applications, affidavits and other instruments and shall do such other acts,
including giving testimony in support of inventorship, as in the opinion of the
Company is necessary, proper or convenient to apply for, obtain and maintain
letters patent of the United States or any foreign country or to otherwise
protect the Company's interest in connection with the Inventions.
(c) The Consultant shall make, maintain and furnish to the Company
thorough, accurate, complete and current written records of all Inventions in
the form of notes, reports, drawings, and sketches, as may be appropriate,
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setting forth in detail any procedures employed and results obtained. All such
records shall be and remain the sole property of the Company and shall be
available to the Company at all times.
8. Independent Contractor. The Consultant and the Company understand and
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acknowledge that the Consultant's relationship with the Company is that of an
independent contractor and nothing in this Agreement is intended to or should be
construed to create a partnership, joint venture or employment relationship. The
Consultant further acknowledges that the Consultant will not be treated or
regarded as a Company employee under the laws or regulations of any government
or governmental agency. The Company shall not withhold from the Consultant's
fees any amounts for income taxes or other similar assessments. The Consultant
will be the sole judge of the means, manner and method by which it will perform
the Services, the times at which the Services will be performed (within the
deadlines reasonably established by the Company) and the sequence of performance
of the Services. The Company will not have the authority to supervise or control
the actual work of the Consultant. It is further agreed that the Company: (i)
will not provide the Consultant with any business registrations or licenses
required to perform the Services set forth herein; (ii) will not require the
Consultant to perform work exclusively for the Company; (iii) will not pay the
Consultant a salary or hourly rate; (iv) will not provide tools to the
Consultant; (v) will not dictate the time of performance of the Consultant's
performance; (vi) will pay the Consultant in the name appearing on this
Agreement; and (vii) will not combine business operations with the Consultant,
but instead will keep the operations of the Consultant and the Company separate.
9. Benefits. The Company shall not be obligated to provide the Consultant
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with any benefits provided to employees of the Company, including, but
not limited to, health and life insurance and participation in employee benefit
plans.
10. Remedies. In addition to the other remedies provided by law or equity,
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upon a breach by the Consultant of any of the covenants contained in this
Agreement, the Company may be entitled to injunctive relief and to such other
and further relief as may be necessary or appropriate to cause the Consultant to
comply with its duties and obligations herein. Any damages incurred by the
Company as a result of a breach by the Consultant of any of the covenants
contained in this Agreement shall not be limited to the amount paid by the
Company to the Consultant hereunder.
11. Miscellaneous.
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(a) Successors; Assignment. The Consultant's rights and obligations
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under this Agreement shall not be transferable by assignment or
otherwise. Nothing in this Agreement shall prevent the
consolidation of the Company with, or its merger into, any other
corporation, or the sale by the Company of all or substantially
all of its properties or assets. This Agreement shall inure to
the benefit of, be binding upon and be enforceable by and
against, any successor, surviving or resulting corporation, or
other entity to which the assets the Company shall be
transferred. This Agreement shall not be terminated by the
voluntary or involuntary dissolution of the Company.
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(b) Expenses. If any legal proceeding is necessary to enforce or
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interpret the terms of this Agreement, or to recover damages for
breach hereof, the prevailing party shall be entitled to receive
from the other party reasonable attorneys' fees and necessary
costs and disbursements incurred in such litigation, in addition
to any other relief to which such prevailing party may be
entitled.
(c) Severability. The provisions of this Agreement shall be regarded
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as severable, and if any said provisions or any part hereof is
declared invalid or unenforceable by a court of competent
jurisdiction, the validity and enforceability of the remainder of
such provisions or parts hereof and the applicability thereof
shall not be affected thereby.
(d) Amendment. This Agreement may not be amended or modified except
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by written instrument executed by the Company and the
Consultant.
(e) Governing Law. This Agreement and the rights and obligations
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hereunder shall be governed by and construed in accordance
with the laws of the State of Delaware without regard to its
conflict of law principles.
(f) Notice. Notices given pursuant to this Agreement shall be deemed
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to have been given at the earlier of the date when
actually delivered to a party by personal delivery, commercial
courier, or telephonic facsimile transmission accompanied by a
telephonic facsimile receipt and followed by a hard copy by the
United States mail, or three (3) days after being deposited in
the United States mail, certified or registered mail, postage
prepaid, return receipt requested, and in each case addressed as
follows, unless and until any party notifies the other party in
accordance with this section of a change of address:
If to Consultant: Opus Diagnostics, Inc.
Xxx Xxxxxx Xxxxx
Xxxx Xxx XX 00000
Attn: Xx. Xxxxxx Xxxxx
Fax No.:000-000-0000
with a copy to: Xxxxxx Xxxx & Priest LLP
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxx X. Xxxx, Esq.
Fax No.: 000-000-0000
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If to the Company: Seradyn, Inc.
c/o Apogent Technologies Inc.
00 Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: Xxxxx Xxxxx
Fax No.: 000-000-0000
with a copy to: c/o Apogent Technologies Inc.
00 Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxx, Esq.
Fax No.: 000-000-0000
(g) No Waiver. No waiver by either party at any time of any breach by
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the other party, or compliance with, any condition or provision
of this Agreement to be performed by the other party shall be
deemed a waiver of similar or dissimilar provisions or conditions
at the same time or any prior or subsequent time.
(h) Headings. The headings herein contained are for reference only
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and shall not affect the meaning or interpretation of
any provision of this Agreement.
(i) Timing. Time is of the essence as to the performance of the
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parties' obligations set forth hereunder.
(j) Entire Agreement. This Agreement and the documents to be
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delivered pursuant hereto constitute the entire agreement between
the parties pertaining to the subject matter hereof, and
supersede all prior and contemporaneous agreements,
understandings, negotiations, and discussions of the parties,
whether oral or written.
(signature page follows)
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
SERADYN, INC.
By: ________________________________
Title:______________________________
CONSULTANT
By: ________________________________
Title:______________________________
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Xxxxxx Xxxxx (for purposes of
Sections 6 and 7)
