EXHIBIT 2.3
FORM OF
CONSULTING AGREEMENT
This CONSULTING AGREEMENT (the "Agreement") is entered into as of
November 21, 1995 between PSICOR, Inc., a Pennsylvania corporation (the
"Company"), and Xxxxxxx Xxxxxx ("Consultant").
WHEREAS, as of the date hereof, Consultant serves as the Chief
Financial Officer of the Company; and
WHEREAS, the Company desires to retain the services of Consultant as a
consultant to the Company in the event of the termination of Consultant's
employment by the Company for any reason other than for cause within two (2)
years from the date hereof; and
WHEREAS, Consultant is willing to agree to serve as a consultant to
the Company, on the terms and conditions provided herein, and to receive the
benefits hereof in lieu of any agreement or other arrangement regarding
severance or similar benefits.
NOW, THEREFORE, in consideration of the premises and the respective
covenants and agreements of the parties contained herein, and intending to be
legally bound hereby, the parties hereto agree as follows:
1. RETENTION AS A CONSULTANT. During the Consulting Period (as
defined below) (i) the Company shall retain Consultant and Consultant shall
serve the Company as an independent consultant on the terms and conditions set
forth herein and (ii) Consultant shall provide such consulting services to the
Company as the Company may reasonably request under the direction of the
Company's Board of Directors consistent with its overall objectives in an amount
not to exceed (x) 40 hours per month for the first three months of the
"Consulting Period" (as defined below) and (y) 20 hours per month thereafter.
Consultant may perform his duties hereunder at such locations as may be agreed
upon between Consultant and the Company (PROVIDED, that if requested to perform
such
duties in any location other than the San Diego, California, area the Company
shall reimburse Consultant for his reasonable out-of-pocket expenses incurred in
connection therewith in accordance with Section 3(b) hereof) or by telephone
consultation, written communication and/or by fax as appropriate. As an
independent consultant, Consultant shall not be authorized to act for or enter
into any agreement on behalf of the Company without written authorization from
the Company's Board of Directors.
2. CONSULTING PERIOD. (a) If Consultant's employment is terminated
either (i) by the Company other than for "Cause" (as defined below) or (ii) by
Consultant for "Good Reason" (as defined below), in each case during the "Two-
Year Period" (as defined below), Consultant shall be retained by the Company as
a consultant and shall provide the services specified herein for a period of
six/nine months from the date of such termination (such date, the "Effective
Date," and such period, the "Consulting Period"). Following the termination of
the Consulting Period, except as otherwise specifically provided herein (i) the
Company's obligations under this Agreement shall cease and the Company shall
have no further obligations to Consultant under this Agreement and (ii)
Consultant's obligation to the Company to provide the consulting services
contemplated by Section 1 hereof shall cease. If, during the Two-Year Period,
Consultant's employment is not terminated by the Company other than for Cause
or by Consultant for Good Reason, this Agreement shall expire without further
obligation of either the Company or Consultant as of the end of the Two-Year
Period. As used herein, the "Two-Year Period" shall mean the two-year period
beginning on the date hereof and the parties acknowledge that Consultant is an
employee of the Company on the date hereof.
(b) As used herein, "Cause" shall mean:
i) Consultant's willful failure to perform or
habitual neglect of his duties as an employee of the Company or a subsidiary
thereof;
ii) Consultant's commission or conviction of any crime
or criminal offense involving theft, fraud, embezzlement, misappropriation of
assets, malicious mischief, or any felony; or
iii) Consultant's willful engaging in conduct which is
injurious to the Company or a subsidiary thereof monetarily or other-
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wise, including, but not limited to, conduct that constitutes competitive
activity or other activity inconsistent with the terms of Section 4 hereof.
(c) As used herein, "Good Reason" shall mean any diminution in
the nature or status of Consultant's authority, duties and responsibilities or
any diminution in Consultant's base salary, in each case from those in effect as
of the date hereof.
3. COMPENSATION AND RELATED MATTERS. As compensation for the
services to be rendered by Consultant and the noncompetition and confidentiality
agreements provided for hereunder, and in lieu of any severance or termination
benefits to which Consultant might otherwise be entitled in connection with the
termination of his employment, the Company shall make the following payments and
provide the following benefits to Consultant during the Consulting Period:
(a) CONSULTING FEE. During the Consulting Period the Company
shall pay Consultant a consulting fee payable no less frequently than monthly at
the rate of $8,333 per month.
(b) REIMBURSEMENT OF EXPENSES. The Company shall provide
Consultant with reimbursement for reasonable and necessary business expenses to
the extent such expenses are incurred upon the request of the Company and
provided that such expenses are accounted for in accordance with the policies
and procedures established by the Company from time to time for its senior
executives.
4. NON-COMPETITION; NON-DISCLOSURE. Consultant recognizes and
expressly acknowledges that (i) he has developed a highly valuable expertise in
the business of cardiovascular perfusion and ancillary services, including
without limitation delivery of perfusion services and sales of supplies in
connection therewith, which expertise is of a special, unique and extraordinary
character (as such perfusion and related business is presently conducted by the
Company and its Subsidiaries, the "Company Business"); (ii) he is voluntarily
entering into this Agreement, including without limitation this Section 4, with
the intent that the covenants in this Section 4 shall be valid and enforceable;
and (iii) the terms and conditions of this Agreement and this Section 4 are fair
and reasonable to him in all respects and will not create any hardship for him.
In light of the foregoing, and for and in consideration of benefits derived
directly and indirectly from this Agreement, Consultant covenants and agrees as
follows:
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(a) During the term of Consultant's employment with the Company
and during the Consulting Period (the "Noncompete Term"), Consultant shall not,
alone or as a member, employee or agent of any partnership or as an officer,
agent, employee, consultant, director, shareholder (except for passive
investments of not more than (x) two percent (2%) of the outstanding shares of,
or any other equity interest in, any company or entity (other than one listed or
traded on a national securities exchange or on an over-the-counter securities
market) and (y) five percent (5%) of the outstanding shares of, or any other
equity interest in, any company or entity listed or traded in a national
securities exchange or over-the-counter securities market) of any corporation or
entity, directly or indirectly manage, operate, join, control or participate in
the management, operation or control of, or work for (as an employee,
consultant, independent contractor or otherwise) or permit the use of its name
by, or be connected in any manner with any business or activity which is in
competition with the Company Business in any town, county, parish or other
municipality in any state of the United States in which the Company Business is
presently conducted and in any town, county, parish or municipality adjacent
thereto.
(b) During the Noncompete Term, Consultant shall not, directly
or indirectly, solicit, induce, or attempt to solicit or induce (x) any
employee of the Company or its Subsidiaries, affiliates, successors or assigns
to terminate his or her employment relationship with the Company or its
Subsidiaries, affiliates, successors or assigns for the purpose of associating
with any competitor of the Company or its Subsidiaries, affiliates, successors
or assigns; or (y) any customer, client, vendor, supplier or consultant then
under contract to the Company or its Subsidiaries, affiliates, successors or
assigns, to terminate his, her or its relationship with the Company or its
Subsidiaries, affiliates, successors or assigns, for the purpose of associating
with any competitor of the Company or its Subsidiaries, affiliates, successors
or assigns.
(c) Unless otherwise required by any applicable law or rules and
regulations of any national securities exchange, not to disclose to any person
any trade secrets or confidential information with respect to any of the
Company's patents, trademarks, products, improvements, formulas, designs or
styles, processes, customers, methods of distribution or methods of manufacture;
PROVIDED, HOWEVER, that such trade secrets or confidential information shall not
include any information known generally to the public (other than as a result of
unauthorized disclosure by Consultant).
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(d) Consultant recognizes and acknowledges that his expertise is
of a special, unique and extraordinary character and that (i) in the event of
his failure to comply with any of the restrictions contained in this Section 4,
it may be impossible to measure in money the damage to the Company and (ii) in
the event of any such failure, such persons may not have an adequate remedy at
law. It is therefore agreed that the Company, in addition to any other rights
or remedies which it may have, shall be entitled to immediate injunctive relief
to enforce such restrictions, and specific enforcement of the provisions of this
Section 4 in the event of any breach or threatened breach hereof.
(e) Consultant further acknowledges and agrees that these
covenants are reasonable and valid in geographic and temporal scope and in all
other respects and that if any court determines that any of these covenants, or
any part thereof, is invalid or unenforceable, the remainder of these covenants
shall not thereby be affected and shall be given full effect without regard to
the invalid portions. If any court determines that any of these covenants, or
any part thereof, is unenforceable because of the duration or scope of such
provision, such court shall have the power to reduce the duration or scope of
such provision, as the case may be, and, in its reduced form, such provision
shall then be enforceable.
5. SUCCESSORS; BINDING AGREEMENT. The services to be performed by
Consultant hereunder are personal in nature, and the obligations to perform such
services and the conditions and covenants of this Agreement cannot be delegated
by Consultant. This Agreement will be binding upon, inure to the benefit of and
be enforceable by, the Company and its successors and assigns. The Company may
assign, in its sole discretion, any or all of its rights, interests and
obligations hereunder to any third party PROVIDED that the Company shall also
remain obligated hereunder.
6. NOTICES. All notices and other communications hereunder shall be
in writing and shall be deemed given upon personal delivery, facsimile
transmission (which is confirmed), telex or delivery by an overnight express
courier service (delivery, postage or freight charges prepaid), or on the fourth
day following deposit in the United States mail (if sent by registered or
certified mail, return receipt requested, delivery, postage or freight charges
prepaid), addressed to the parties at the following addresses (or at such other
address for a party as shall be specified by like notice):
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If to Consultant, to
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Telecopy No.-----------------
Attention: Xxxxxxx Xxxxxx
with a copy to:
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Telecopy No. ----------------
Attention: ------------------
If to the Company, to:
PSICOR, Inc.
00000 Xxx xxx Xxxxx Xxxxx
Xxx Xxxxx, XX 00000
Telecopy No. (000) 000-0000
Attention: Xxxxxx Xxxxxxxxxx
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
7. WITHHOLDING. All amounts payable and benefits provided hereunder
shall be subject to, and reduced by, any withholding taxes as may be required by
law. In the case of the provision of benefits, the Company may withhold from
any cash payments payable hereunder any withholding taxes imposed on, or arising
from, the benefits provided hereunder.
8. MODIFICATION OF AGREEMENT; GOVERNING LAW. No provisions of this
Agreement may be modified, waived or discharged unless such waiver, modification
or discharge is agreed to in writing signed by Consultant and such officer of
the Company as may be specifically designated by the Board of Directors of the
Company. No waiver by either party hereto at any time of any term, provision or
condition of this Agreement, whether by conduct or otherwise, in any one or more
instances, shall be deemed to be or construed as a further or
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continuing waiver of any such term, provision or condition or as a waiver of any
other term, provision or condition of this Agreement. No agreements or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not set forth
expressly in this Agreement. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of
California without regard to its conflicts of law principles.
9. VALIDITY. The validity or enforceability of any provision or
provisions of this Agreement shall not be affected by the invalidity or
unenforceability of any other provision of this Agreement, and such valid and
enforceable provisions shall remain in full force and effect.
10. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together will constitute one and the same instrument.
11. OBLIGATIONS AND CLAIMS, ENTIRE AGREEMENT. Consultant
acknowledges and agrees that (a) all obligations of the Company to him prior
to the date hereof (and, as of the Effective Date, prior to such date) in his
capacity as an officer of the Company have been (and, as of the Effective Date,
will be) fully satisfied other than (i) any obligation of the Company for
indemnification of claims (x) pending as of the date hereof as set forth in
Exhibit A hereto and (y) not made as of the date hereof (and Consultant
represents and warrants to the Company that as of the date hereof he is not
aware, and as of the Effective Date he will not be aware, of any such claims
pending other than as set forth on Exhibit A hereto on the day hereof or on or
about the Effective Date), (ii) accrued but unpaid salary and benefits, and
business expenses reimbursable by the Company in accordance with Company policy,
and (iii) for amounts specifically accruing to Consultant under the terms of
this Agreement, and (b) he understands that the Company's willingness to enter
into this Agreement and its obligations hereunder are conditioned upon his
foregoing acknowledgement being true and correct as of the date hereof and as of
the Effective Date and his written confirmation thereof being delivered to the
Company within five (5) business days after the Effective Date. This Agreement
sets forth the entire agreement of the parties hereto with respect to the
subject matter contained herein and supersedes all prior agreements, promises,
covenants, arrangements, communications, representations or warranties, whether
oral or written, by any officer, employee or representative of any party hereto,
and any other prior agreement of the parties hereto in respect of the subject
matter contained herein is hereby terminated and canceled.
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12. ATTORNEY'S FEES. In the event of litigation relating to this
Agreement, if a court of competent jurisdiction determines that this Agreement
has been breached by either party, then the breaching party will reimburse the
non-breaching party for its reasonable costs and expenses (including without
limitation legal fees and expenses) incurred in connection with all such
litigation.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date and year first above written.
PSICOR INC.
By /s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx X. Xxxxxxx
Title: Chief Executive Officer
and President
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Name: Xxxxxxx Xxxxxx
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