Exhibit 10.24
CONSULTING AGREEMENT
AGREEMENT, dated as of January 20, 1997 between Unilab Corporation, a
Delaware corporation with its executive offices located at 00000 Xxxxxx Xxxxxx,
Xxxxxxx, Xxxxxxxxxx 00000 (hereinafter "Unilab" or the "Company") and Xxxxxxx
Ltd., with its executive offices located at 000 Xxxxxxxxxx Xxxxxx, Xxxxxxxxxx,
Xxx Xxxxxx 00000 (hereinafter the "Consultant"):
WHEREAS, Xxxxxx X. Xxxxx ("Xxxxx") served as Chairman, President and
Chief Executive Officer of Unilab from October 1992 through the date hereof;
WHEREAS, Xxxxx has been a leading executive in the clinical laboratory
industry for more than a decade;
WHEREAS, Xxxxx is the owner and President of Consultant;
WHEREAS, Unilab desires to continue to have the benefit of Xxxxx'x and
Consultant's experience and knowledge of the clinical laboratory industry
following Xxxxx'x resignation on the date hereof from his positions as Chairman,
President and Chief Executive Officer of Unilab, and Consultant desires to be
retained by Unilab as a Consultant;
NOW, THEREFORE, in consideration of the material covenants and
agreements set forth herein, the parties hereto covenant and agree as follows:
Engagement of Consultant. Unilab hereby engages the Consultant to
advise and consult with Unilab's senior management and Board of Directors with
respect to laboratory industry developments; investment opportunities; financing
possibilities; client development; and laboratory operations (collectively, the
"Consulting Services"). The Consultant represents and warrants to Unilab that it
has no commitments, arrangements or other agreements with any other clinical
laboratory companies, and there are no restrictions under applicable law or
licensing regulations, which might preclude the carrying out of his obligations
under this Agreement.
1. Term. The term of this Agreement shall be for three (3) years from the
date hereof, unless sooner terminated as provided herein.
2. Compensation.
(a) Unilab shall pay the Consultant $900,000 for the Consulting
Services, payable (i) $600,000 in a lump sum payment promptly
after the date hereof and (ii) $100,000 per year, payable
quarterly in advance. Consultant shall
make itself available to provide up to 30 hours per week of
Consulting Services, at Unilab's request.
(b) Consultant shall be reimbursed for its reasonable and ordinary
business expenses incurred in providing Consulting Services,
provided such expenses are approved by Unilab's Chief Executive
Officer (or, in the case of overseas or cross-continental travel,
pre-approved by the Chief Executive Officer).
3. Indemnification.
(a) Consultant and Xxxxx agree to defend, indemnify, and hold Unilab,
its subsidiaries, directors, officers, employees and agents,
wholly harmless from and against any and all costs (including
reasonable attorney's fees) liabilities, claims, losses,
lawsuits, settlements, demands, causes, judgments and expenses
(collectively, "liabilities") arising from performance of this
Agreement to the extent that such costs and liabilities result
directly from the willful misconduct of Consultant or Xxxxx
constituting fraud against Unilab as determined in a final
finding of a court of competent jurisdiction.
(b) Unilab agrees to defend, indemnify, and hold Consultant and Xxxxx
wholly harmless, to the fullest extent permitted by law (and as
if Xxxxx were still an officer and director of Unilab), from and
against any and all costs (including reasonable attorney's fees),
liabilities, claims, losses, lawsuits, settlements, demands,
causes, judgments and expenses (collectively, "liabilities")
arising from the performance of this Agreement, except to the
extent that such costs and liabilities result directly from the
willful misconduct of Consultant or Xxxxx constituting fraud
against Unilab as determined in a final finding of a court of
competent jurisdiction.
4. Termination. This Agreement shall terminate on the occurrence of any
of the following conditions.
(a) Three (3) years from the date of this Agreement.
(b) In the event of a Default (as defined below) of this Agreement by
either party hereto, the other party shall have the right to
immediately begin cancellation proceedings of this agreement by
giving written notice of cancellation to the defaulting party
(the "Default Notice"). The non-defaulting party will give a
30-day cure period during which the defaulting party may have the
opportunity to cure the breach to the satisfaction of the
non-defaulting party. Nothing herein shall eliminate the
non-defaulting party's right to damages for the Default, in
addition to the remedies described herein.
2
(i) For the purposes of this Agreement, Consultant shall be deemed to
be in Default hereunder upon (1) Consultant or Xxxxx having been
convicted by a court of competent jurisdiction of any felony
involving moral turpitude; (2) the material violation by
Consultant or Xxxxx of Sections 3 or 5 of this Agreement; or (3)
Consultant or Xxxxx having been finally found by a court of
competent jurisdiction to have engaged in willful misconduct
constituting fraud against Unilab.
(ii) For the purposes of this Agreement, Unilab shall be deemed to be
in Default hereunder upon (1) Unilab or any of its officers or
directors having been convicted by a court of competent
jurisdiction of any felony involving moral turpitude; (2) the
willful malfeasance or gross negligence by Unilab in the
performance of its duties hereunder; (3) the material violation
by Unilab of any material provision of this Agreement; or (4)
Unilab or any of its officers or directors having been found to
have engaged in conduct constituting fraud against Consultant or
Xxxxx. In the event of a termination by Consultant hereunder,
Consultant shall be entitled immediately to payment of all
compensation that otherwise would have been payable during the
three-year term hereof.
5. Confidential Information.
(a) The Consultant and Xxxxx shall not directly or indirectly
disclose to anyone who is not authorized by the Company to
receive such information, or use or appropriate for its or his
own benefit or the benefit of anyone other than the Company, any
documents or materials relating to the Company's clinical
laboratory business (the "Business") or its customers which Xxxxx
obtained during his employment or which the Consultant or Xxxxx
obtain during the term of this Agreement, including files,
Business descriptions, Business relationships and accounts,
pricing policies, customer lists, computer software and hardware,
or any other materials relating to the Business or its customers
or any trade secrets or confidential information including,
without limitation, any Business methods, know-how, processes,
financial or other performance data, plans, policies and/or
personnel of the Company, whether generated by the Consultant or
Xxxxx or by any employee of the Company; provided, however, that
confidential information shall not include any information
generally known to the public (other than as a direct or indirect
result of unauthorized disclosure by the Consultant or Xxxxx), or
any information of a type not otherwise considered confidential
by persons engaged in the same business or a business similar to
that conducted by the Company.
3
(b) At no time during or after the term of this Agreement shall the
Consultant or Xxxxx remove or cause to be removed from the
premises of the Company any record, file, memorandum, document,
equipment or any like item relating to the business of the Company
except in furtherance of its or his duties hereunder or with the
permission of the Company.
6. Severability. Each provision of this Agreement shall be treated as a
separate and independent clause, and the unenforceability of any one clause
shall in no way impair the enforceability of any of the other clauses herein. If
one or more of the provisions contained in this Agreement shall, for any reason,
be held to be unenforceable, such provision or provisions shall be construed by
an appropriate judicial body by limiting and reducing it or them, so that this
Agreement shall be enforceable to the maximum extent compatible with the
applicable law as it shall then appear.
7. Injunctive Relief. Both parties recognize that a breach of Section 5
of this Agreement may cause irreparable damage, the exact amount of which would
or may be difficult or impossible to ascertain, and that remedies at law for any
such breach would be inadequate. Accordingly, either party shall be entitled, in
addition to any other rights or remedies existing in its favor, to obtain
specific performance or injunctive relief in order to enforce Section 6 of this
Agreement or prevent a breach or further breach of any provision hereof.
8. No Waiver. No waiver of any breach or failure by any party to
enforce any of the terms or conditions of this Agreement at any time shall, in
any manner, limit or waive such party's right thereafter to enforce and to
compel strict compliance with every term and condition thereof.
9. Independent Contractor. It is understood that Consultant's services
hereunder are to be rendered in the capacity of an independent contractor, and
that Consultant is not in any respect or under any circumstances an employee of
Unilab. Neither party has authority to enter into contracts or assume any
obligations for or on behalf of the other party or to make any warranties or
representations for or on behalf of the other party. Consultant shall be solely
responsible for any taxes imposed on the performance of services or the payment
for such services, including withholding of state and federal income, sales or
ad valorem, unemployment compensation, worker's compensation, Federal Insurance
Contributions Act, Federal Unemployment Tax Act or other taxes, costs or
expenses incurred in the performance of any engagement hereunder. Consultant
expressly indemnifies and holds Unilab harmless from any such liabilities.
4
10. Assignment. This Agreement is not assignable in whole or in part by
either party without the prior written consent of the other party. This
Agreement shall be binding upon and shall inure to the benefit of any successors
or permitted assigns of Unilab, whether by merger, consolidation, sale of all or
substantially all of the assets or otherwise.
11. Entire Agreement; Captions. This instrument contains the entire
agreement of the parties with respect to the subject matter contained herein,
and may not be changed orally but only by an agreement in writing signed by the
party against whom enforcement of any waiver, change, modification, extension or
discharge is sought. The captions of the sections of this Agreement are inserted
as a matter of convenience only, and in no way define, limit or describe the
scope of this Agreement or any provision thereof.
12. Notices. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
delivered by hand, by nationally recognized overnight delivery service, or
mailed by certified or registered mail, postage prepaid, addressed as follows:
If to the Consultant: Xxxxxx X. Xxxxx
000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxxx Xxxxx, XX 00000
If to Unilab: Unilab Corporation
00000 Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Corporate Secretary
With a copy to: Unilab Corporation
000 Xxxxxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: Legal Department
The above addresses for the purpose of receiving notices hereunder may
be changed by giving written notice of such change in the manner provided herein
for giving notices.
13. Governing Law. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of California.
5
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day first hereinabove written. XXXXXXX, LTD.
By: ____________________________
Name: Xxxxxx X. Xxxxx
Title: President
UNILAB CORPORATION
By: ____________________________
Name:
Title:
6
