EXHIBIT 1
CONSULTING AGREEMENT
AGREEMENT dated as of 15th day of July 2004 by and between Scantek
Medical Inc., a Delaware corporation, with an address at 0X Xxxx Xxxxx, Xxxxx
Xxxxxx, XX 00000 (the "Company") and Xxxxxx Xxxxx, with an address at 00
Xxxxxxxxx Xxxx., Xxx Xxxxx, XX 00000 (the "Consultant").
WITNESSETH
WHEAREAS, the Company had previously engaged the services of the
Consultant pursuant to a Consulting Agreement dated as of the 17th day of
September 2003 by and between the Company and the Consultant (the "2003
Consulting Agreement"); and
WHEREAS, the Company and the Consultant desire to enter into this
Agreement to set forth new terms and conditions with respect to the Company's
engagement of the Consultant and terminate the 2003 Consulting Agreement, as of
the date of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants of the parties
which are hereinafter set forth and for other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged,
IT IS AGREED:
1. Recitals Adopted. The parties hereto adopt as part of this Agreement
each of the recitals contained above in the WHEREAS clauses, and agree that such
recitals shall be binding upon the parties hereto by way of contract and not
merely by way of recital or inducement; and such clauses are hereby confirmed
and ratified as being true and accurate by each party as to itself.
2. Termination. The parties hereby mutually consent to the termination
of the 2003 Consulting Agreement, which termination shall be effective as of the
date of this Agreement and as a result of which all of the provisions of the
2003 Consulting Agreement shall no longer be in force and effect and the 2003
Consulting Agreement shall be deemed to be null and void.
3. Engagement.
A. Upon the terms and conditions which are hereinafter set forth,
the Company hereby retains the Consultant as an advisor and consultant to the
Company and its officers and directors to provide services, including, but not
limited to, the following (the "Consulting Services"):
i. Business development and business advertising;
ii. Strategic alliances;
iii. Introducing the Company to banks, lenders and other
financing sources;
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iv. Advising the Company in connection with management, marketing
and financing strategy;
v. Provide advice in structuring business acquisitions and
assisting the Company in negotiations for the acquisition of Merger Candidates;
and
vi. Such other matters as the Company shall from time to time
request.
B. The Consultant shall not be required to devote any minimum number
of weeks, days, or hours to the affairs of the Company during the term of this
Agreement; provided, however that the Consultant shall devote such time,
attention and energies to the business of the Company, as the Consultant
determines in the exercise of his good faith determination.
4. Term.
A. The term of this Agreement shall commence as of July 15, 2004 and
shall continue for a period of thirty-six (36) months until July 14, 2007 (the
"Term"). The Company shall have the right to terminate the Consultant for Cause
as defined in Article "11" of this Agreement.
B. This Agreement may be extended by the mutual written agreement of
the parties.
5. Compensation. The Consultant shall provide the Consulting Services
as partial consideration for the issuance of one million (1,000,000) shares of
Common Stock of the Company to the Consultant and his designees. The shares when
issued to the Consultant and/or his designees will be duly authorized, validly
issued and outstanding, fully paid and non assessable and will not be subject to
any liens or encumbrances. If the Consultant is terminated for any reason,
including, but not limited to, for Cause, the Consultant shall keep all of the
aforesaid shares of Common Stock.
6. Costs and Expenses. The Consultant shall be responsible for all
expenses that the Consultant may incur in performing the Consulting Services
pursuant to this Agreement including, but not limited to, travel expenses, third
party expenses, copy and mailing expenses unless otherwise pre-approved in
writing by Company.
7. Due Diligence. The Company shall supply and deliver to the
Consultant all information relating to the Company's business as may be
reasonably requested by the Consultant to enable the Consultant to make an
assessment of the Company and its business prospects and provide the Consulting
Services.
8. Best Efforts Basis. The Consultant agrees that he will, at all
times, faithfully and in a professional manner perform all of the duties that
may be reasonably required of, and from, the Consultant pursuant to the terms of
this Agreement. The Consultant does not guarantee that his efforts will have any
impact upon the Company's business or that there will be any specific result or
improvement from the Consultant's efforts.
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9. Company's Right to Approve Transactions.
A. The Company expressly retains the right to approve, in its sole
discretion, each and every transaction introduced by the Consultant that
involves the Company as a party to any agreement. The Consultant and the Company
mutually agree that the Consultant is not authorized to enter into agreements on
behalf of the Company. It is mutually understood and agreed that the Company is
not obligated to accept any recommendations or close any transactions submitted
by the Consultant.
B. The Consultant agrees to provide the Company for approval, in his
sole and absolute discretion, a reasonable time in advance, any documents which
are intended to be utilized by the Consultant with respect to his services
pursuant to this Agreement, or otherwise. The Company will carefully and
thoroughly review all such material including without limitation material
provided by the Company to the Consultant and intended to be used by the
Consultant, as to the accuracy of the contents thereof and will promptly notify
the Consultant in writing of any inaccuracies or changes to be made with respect
thereto.
10. Non-Exclusive Services. The Company acknowledges that the
Consultant is currently providing services of the same or similar nature to
other parties and the Company agrees that the Consultant is not prevented or
barred from rendering services of the same nature or a similar nature to any
other individual or entity. The Consultant understands and agrees that the
Company shall not be prevented or barred from retaining other persons or
entities to provide services of the same or similar nature as those provided by
the Consultant. The Consultant will take reasonable steps to determine and to
advise the Company of his position with respect to any activity, employment,
business arrangement or potential conflict of interest which may be relevant to
this Agreement, but Consultant shall not be obligated to conduct an exhaustive
review of his activities or those of his clients to determine whether or not
such a conflict exists.
11. Cause. For purposes of this Agreement, the term "Cause" shall be
limited to: (A) willful malfeasance or gross negligence; (B) the Consultant's
fraud, misappropriation or embezzlement; (C) the Consultant's failure to perform
such duties which are reasonably assigned by the Board of Directors of the
Company, provided such duties are customary and appropriate for his consulting
obligations to the Company; or (D) the Consultant's default, violation of, or
failure to perform any provision of this Agreement; provided however that any
termination shall be subject to (i) the Consultant's receipt of written notice
(the "Default Notice") from the Company specifying the failure or default and
(ii) the Consultant's (a) failure to cure such default within ten (10) days
after receipt of the Default Notice or (b) if it is a default which cannot, with
due diligence, be cured within ten (10) days, the Consultant's failure to
institute within ten (10) days steps reasonably necessary to remedy such default
and thereafter diligently prosecutes same to completion.
12. Representations, Warrants and Covenants of the Consultant. The
Consultant represents, warrants and covenants to the Company as follows:
A. The Consultant has the full authority, right, power and legal
capacity to enter into this Agreement and to consummate the transactions which
are provided for herein.
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B. The business and operations of the Consultant have been and
are being conducted in all material respects in accordance with all applicable
laws, rules and regulations of all authorities which affect the Consultant or
his properties, assets, businesses or prospects. The performance of this
Agreement shall not result in any breach of, or constitute a default under, or
result in the imposition of any lien or encumbrance upon any property of the
Consultant or cause an acceleration under any arrangement, agreement or other
instrument to which the Consultant is a party or by which any of his assets are
bound. The Consultant has performed in all respects all of his obligations which
are, as of the date of this Agreement, required to be performed by the
Consultant pursuant to the terms of any such agreement, contract or commitment.
C. The execution, delivery and performance of this Agreement:
(i) does not violate any agreement or undertaking to which the Consultant is a
party or by which the Consultant may be bound and (ii) shall not result in the
imposition of any restrictions or obligations upon the Consultant other than the
restrictions and obligations imposed by this Agreement.
D. The execution and delivery by the Consultant of this
Agreement and the performance by the Consultant of his obligations hereunder and
thereunder will not violate any provision of law, any order of any court or
other agency of government, and will not result in a material breach of or
constitute (with due notice or lapse of time or both) a material default under
any provision of any agreement or other instrument to which the Consultant, or
any of his properties or assets, is bound.
E. The Consultant has not entered into and is not subject to any
agreement, including, but not limited, to any employment, noncompete,
confidentiality or work product agreement which would (i) prohibit the execution
of this Agreement, (ii) prohibit his engagement as a Consultant by the Company,
or (iii) affect any of the provisions of, or his obligations pursuant to this
Agreement.
F. If, during the Term, any event occurs or any event known to
the Consultant relating to or affecting the Consultant shall occur as a result
of which (i) any provision of this Article "12" of this Agreement at that time
shall include an untrue statement of a fact, or (ii) this Article "12" of this
Agreement shall omit to state any fact necessary to make the statements herein,
in light of the circumstances under which they were made, not misleading, the
Consultant will immediately notify the Company pursuant to Paragraph "C" of
Article "21" of this Agreement.
G. The receipt of the Common Stock by the Consultant is for the
Consultant's own account, is for investment purposes only, and is not view to,
nor for offer or sale in connection with, the distribution the Common Stock. The
Consultant is not participating and does not have a participation in any such
distribution or the underwriting of any such distribution.
H. The Consultant has no present intention of creating a market
or participating or assisting in the creation of a market or in the promotion of
a market for any securities of the Company.
I. The Consultant has no present intention of selling or
otherwise disposing of the Common Stock in violation of applicable securities
laws.
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J. The Consultant is aware that no federal or state governmental
authority has made any finding or determination as to the fairness of an
investment in the Common Stock, or any recommendation or endorsement with
respect thereto.
K. The Consultant is able to bear the economic risk of the
investment in the Common Stock for an indefinite period of time, including the
risk of total loss of such investment and the Consultant recognizes that an
investment in the Common Stock involves a high degree of risk. The Consultant
understands that the Common Stock has not been registered under the Securities
Act of 1933, as amended (the "Securities Act") or the securities laws of any
state and, therefore, cannot be sold unless they subsequently are registered
under the Securities Act and any applicable state securities laws or exemptions
from registration thereunder are available. The Consultant further understands
that only the Company can take action to register the Common Stock.
L. The Consultant is an "accredited investor" as that term is
defined in Rule 501(a) of Regulation D promulgated under the Securities Act.
M. The Consultant has such knowledge and experience in
financial, investing and business matters as to be capable of evaluating the
risks and merits of an investment in the Common Stock and protecting the
Consultant's interests in connection with an investment in the Common Stock.
N. The Consultant has had access to and an opportunity to
inspect all relevant information relating to the Company sufficient to enable
the Consultant to evaluate the merits and risks of his receipt of the Common
Stock hereunder. The Consultant also has had the opportunity to ask questions of
officers of the Company and has received satisfactory answers respecting, and
has obtained such additional information as the Consultant has desired
regarding, the business, financial condition and affairs of the Company.
O. It shall not be a defense to a suit for damages for any
misrepresentation or breach of covenant or warranty that the Company knew or had
reason to know that any representation, warranty or covenant of the Consultant
in this Agreement or furnished or to be furnished to the Company contained
untrue statements.
P. No representation or warranty of the Consultant which is
contained in this Agreement, or in a writing furnished or to be furnished
pursuant to this Agreement, contains or shall contain any untrue statement of a
material fact, omits or shall omit to state any material fact which is required
to make the statements which are contained herein or therein, in light of the
circumstances pursuant to which they were made, not misleading.
Q. All representations, warranties and covenants made in or in
connection with this Agreement shall continue in full force and effect during
and after the Term of this Agreement, it being agreed and understood that each
of such representations, warranties and covenants is of the essence of this
Agreement and the same shall be binding upon the Consultant and inure to the
Consultant, his successors and assigns.
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13. Representations, Warrants and Covenants of the Company. The Company
represents, warrants and covenants to the Consultant as follows:
A. The Company is a corporation with all requisite power and
authority to carry on its business as presently conducted in all jurisdictions
where presently conducted, to enter into this Agreement and to the transactions
which are contemplated herein.
B. The Company has the full authority, right, power and legal
capacity to enter into this Agreement and to consummate the transactions which
are provided for herein. The execution of this Agreement by the Company and its
delivery to the Consultant, and the consummation by it of the transactions which
are contemplated herein have been duly approved and authorized by all necessary
action by the Company's Board of Directors and no further authorization shall be
necessary on the part of the Company for the performance and consummation by the
Company of the transactions which are contemplated by this Agreement.
C. The business and operations of the Company have been and are
being conducted in all material respects in accordance with all applicable laws,
rules and regulations of all authorities which affect the Company or its
properties, assets, businesses or prospects. The performance of this Agreement
shall not result in any breach of, or constitute a default under, or result in
the imposition of any lien or encumbrance upon any property of the Company or
cause an acceleration under any arrangement, agreement or other instrument to
which the Company is a party or by which any of its assets are bound. The
Company has performed in all respects all of its obligations which are, as of
the date of this Agreement, required to be performed by it pursuant to the terms
of any such agreement, contract or commitment.
D. The execution, delivery and performance of this Agreement: (i)
does not violate any agreement or undertaking to which the Company is a party or
by which the Company may be bound and (ii) shall not result in the imposition of
any restrictions or obligations upon the Company other than the restrictions and
obligations imposed by this Agreement.
E. If, during the Term, any event occurs or any event known to the
Company relating to or affecting the Company shall occur as a result of which
(i) any provision of this Article "13" of this Agreement at that time shall
include an untrue statement of a fact, or (ii) this Article "13" of this
Agreement shall omit to state any fact necessary to make the statements herein,
in light of the circumstances under which they were made, not misleading, the
Company will immediately notify the Consultant pursuant to Paragraph "C" of
Article "21" of this Agreement.
F. It shall not be a defense to a suit for damages for any
misrepresentation or breach of covenant or warranty that the Consultant knew or
had reason to know that any representation, warranty or covenant of the Company
in this Agreement or furnished or to be furnished to the Consultant contained
untrue statements.
G. No representation or warranty of the Company which is contained
in this Agreement, or in a writing furnished or to be furnished pursuant to this
Agreement, contains or shall contain any untrue statement of a material fact,
omits or shall omit to state any material fact which is required to make the
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statements which are contained herein or therein, in light of the circumstances
pursuant to which they were made, not misleading.
H. All representations, warranties and covenants made in or in
connection with this Agreement shall continue in full force and effect during
and after the Term of this Agreement, it being agreed and understood that each
of such representations, warranties and covenants is of the essence of this
Agreement and the same shall be binding upon the Company and inure to the
Consultant, its successors and assigns.
14. Nondisclosure of Confidential Information.
A. As used in this Agreement, "Confidential Information" means
information which is presented to the Consultant by the Company or developed,
conceived or created by the Company, or disclosed to the Consultant or known by
or conceived or created by the Consultant during the Term, with respect to the
Company, its business or any of its products, processes, and other services
relating thereto relating to the past, present or future business of the Company
or any plans therefore, or relating to the past, present or future business of a
third party or plans therefore which are disclosed to the Consultant.
Confidential Information includes, but is not limited to, all documentation,
hardware and software relating thereto, and information and data in written,
graphic and/or machine readable form, products, processes and services, whether
or not patentable, trademarkable or copyrightable or otherwise protectable,
including, but not limited to, information with respect to discoveries;
know-how; ideas; computer programs, source codes and object codes; designs;
algorithms; processes and structures; product information; marketing
information; price lists; cost information; product contents and formulae;
manufacturing and production techniques and methods; research and development
information; lists of clients and vendors and other information relating
thereto; financial data and information; business plans and processes;
documentation with respect to any of the foregoing; and any other information of
the Company that the Company informs the Consultant or the Consultant should
know, by virtue of its position or the circumstances in which the Consultant
learned such other information, is to be kept confidential including, but not
limited to, any information acquired by the Consultant from any sources prior to
the commencement of the Consultant becoming a consultant to the Company.
Confidential Information also includes similar information obtained by the
Company in confidence from its vendors, licensors, licensees, customers and/or
clients. Confidential Information may or may not be labeled as confidential.
B. Except as required in the performance of the Consultant's duties
as a consultant, the Consultant will not, during or after the Term, directly or
indirectly, use any Confidential Information or disseminate or disclose any
Confidential Information to any person, firm, corporation, association or other
entity. The Consultant shall take all reasonable measures and efforts to protect
Confidential Information from any accidental, unauthorized or premature use,
disclosure or destruction. The use of such measures and efforts shall not
constitute a defense if any of the Confidential Information is not kept
confidential in accordance with the terms of this Agreement. The foregoing
prohibition shall not apply to any Confidential Information which: (i) was
generally available to the public prior to such disclosure; (ii) becomes
publicly available through no act or omission of the Consultant (iii) is
disclosed as reasonably required in a proceeding to enforce the Consultant's
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rights under this Agreement or (iv) is disclosed as required by court order or
applicable law.
C. Upon termination of the Consultant for any reason, or at any
time upon request of the Company, the Consultant agrees to deliver to the
Company all materials of any nature which are in the Consultant's possession or
control and which are or contain Confidential Information, Work Product or Work
Products (hereinafter defined), or which are otherwise the property of the
Company or any vendor, licensor, licensee, customer or client of the Company,
including, but not limited to writings, designs, documents, records, data,
memoranda, tapes and disks containing software, computer source code listings,
routines, file layouts, record layouts, system design information, models,
manuals, documentation and notes.
D. All copyrights, logos and other advertising materials, conceived
by the Consultant specifically in connection with the consulting services
rendered by Consultant for Company under this Agreement (alone or with others)
during the Term ("Work Product") shall be the exclusive property of and assigned
to the Company or as the Company may direct without compensation to the
Consultant other than the compensation provided for herein. Any records with
respect to the foregoing shall be the sole and exclusive property of the Company
and the Consultant shall surrender possession of such records to the Company
upon any suspension or termination of the Consultant. Any Work Product shall be
deemed incorporated in the definition of Confidential Information for all
purposes hereunder.
E. The Consultant will not assert any rights with respect to the
Company, its business, or any of its products, processes and other services
relating thereto, Work Product or any Confidential Information as having been
acquired or known by the Consultant prior to the commencement of the
Consultant's engagement by the Company unless such rights are asserted in good
faith and verified.
15. Work Product
A. The Consultant represents and warrants to the Company that all
work that the Consultant performs, for or on behalf of the Company, and all work
product that the Consultant produces, including, but not limited to, software,
documentation, memoranda, ideas, designs, inventions, processes, algorithms,
etc. (also "Work Product") will not knowingly infringe upon or violate any
patent, copyright, trade secret or other property right of any other third
party. Further, the Consultant will not disclose to the Company or use in any of
the Consultant's Work Product any confidential or proprietary information
belonging to others, unless both the owner thereof and the Company have
consented to such disclosure and usage.
B. The Consultant will promptly disclose to the Company all Work
Products developed by the Consultant within the scope of the Consultant acting
as a consultant to the Company or which relate directly to, or involve the use
of, any Confidential Information including, but not limited to, all software,
concepts, ideas and designs, and all documentation, manuals, letters, pamphlets,
drafts, memoranda and other documents, writings or tangible things of any kind.
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C. The Consultant acknowledges and agrees that all copyrightable
Work Products prepared by the Consultant within the scope of the Consultant
acting as a consultant to the Company are "works made for hire" and,
consequently, that the Company owns all copyrights thereto subject to Company
fulfilling the compensation obligations to Consultant as provided in this
Agreement.
D. The Consultant hereby assigns, transfers and conveys to the
Company, without additional consideration, all of the Consultant's other rights,
title and interest (including, but not limited to, all patent, copyright and
trade secret rights) in and to all Work Products prepared by the Consultant,
whether patentable or not, made or conceived, in whole or in part, by the
Consultant within the scope of the Consultant acting as a consultant to the
Company, or that relate directly to, or involve the use of, Confidential
Information, subject to Company fulfilling its compensation obligations to
Consultant as provided in this Agreement.
E. The Consultant will, without additional compensation, execute
all assignments, oaths, declarations and other documents requested by the
Company to effect and further evidence the foregoing assignment, transfer and
conveyance, and agrees to provide all reasonable assistance to the Company (at
the Company's expense) to provide all information, documentation and assistance
to the Company in perfecting, enforcing, defending or protecting any or all of
the Company's rights in all Work Product.
16. Indemnification by the Consultant.
A. The Consultant shall indemnify, protect, defend and save and
hold harmless the Company from and against any loss resulting to them from:
i. All liabilities of the Consultant, whether accrued, absolute,
contingent, or otherwise existing on the date of this Agreement;
ii. Any and all losses, liabilities, costs, damages, or expenses
which Company may suffer, sustain or incur arising out of or due to a breach by
the Consultant of any covenant, representation or warranty made in this
Agreement or from any misrepresentation and/or omission pursuant to this
Agreement; and
iii. Any and all claims or actions against the Company, and any
and all costs, expenses, losses, including but not limited to, arbitration
awards, civil judgments, reasonable attorney fees and costs, and court or
arbitration fees and costs, arising out of any act, or any omission of
Consultant in the performance of any duties or services, regardless of whether
said claim or action against the Consultant is individually dismissed, prior to,
or at the arbitration hearing or court proceeding. The Company, in its sole and
absolute discretion, without the prior approval of the Consultant, may settle or
compromise any claim at any time. In the event the Consultant wishes to disagree
with such settlement, it may do so by filing a bond/or depositing into an escrow
account for the benefit of the Company the amount of general damages alleged by
the plaintiff or claimant against Company. In such event, the Company shall
agree not to settle the claim without the consent of the Consultant.
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iv. Any and all losses, claims, damages or liabilities to which
the Company may become subject under the Securities Act of 1933, as amended,
(the "Act") or otherwise insofar as such losses, claims damages or liabilities
(or actions in respect thereof) arise out of or are based upon violations of the
Act, the Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder and upon any untrue statement or alleged untrue statement
or the alleged omission to state therein a material fact required to be stated
in any statements written or and made by the Consultant in performing any of the
Consulting Services pursuant to this Agreement, subject to Company's obligations
as set forth in Article "9" of this Agreement.
B. The indemnification, which is set forth in this Article "16" of
this Agreement shall be deemed to include not only the specific liabilities or
obligations with respect to which such indemnity is provided, but also all
reasonable costs, expenses, counsel fees, and expenses of settlement relating
thereto, whether or not any such liability or obligation shall have been reduced
to judgment.
C. If any demand, claim, action or cause of action, suit,
proceeding or investigation is brought against the Company and/or the Consultant
to which the Company is entitled to indemnification by the Consultant pursuant
to this Article "16" of this Agreement, the Company shall give prompt notice
thereof to the Consultant in accordance with Paragraph "C" of Article "21" of
this Agreement which notice shall contain a reasonably thorough description of
the nature and amount of the claim of indemnification. Upon receipt of such
notice, the Consultant shall use all reasonable efforts to assist in the
vigorous defense of any such matter. The failure of the Company to notify the
Consultant of any such demand, claim, action or cause of action, suit,
proceeding or investigation shall not relieve the Consultant from any liability
which he may have under this Article "16" of this Agreement except to the extent
such failure to notify the Consultant prejudices the Consultant.
17. Time Periods Not Limited. Any period of time set forth in this
Agreement shall not be construed to permit the Consultant to engage in any of
the prohibited acts set forth in this Agreement after such period if such acts
would otherwise be prohibited by any applicable statute or legal precedent.
18. Company. As used in this Agreement, "Company" shall mean Scantek
Medical Inc., its successors and assigns, and any of its present or future
subsidiaries or organizations controlled by it.
19. Assignment. The rights granted hereunder to the Consultant are
personal in nature. Any purported transfer of any such rights, by operation of
law or otherwise, not specifically authorized pursuant to this Agreement shall
be void and shall also constitute a breach of this Agreement; provided, however,
the Consultant may assign all or a portion of the four million (4,000,000)
shares of Common Stock issued to him pursuant to Article "5" of this Agreement
to one or more persons or entities.
20. Relationship. Except as provided for in this Agreement, neither
party is the legal representative or agent of, or has the power to obligate the
other for any purpose whatsoever; and no partnership, joint venture, agent,
fiduciary, or employment relationship is intended or created by reason of this
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Agreement. It is the intent of the parties hereto that the Consultant shall be
an independent contractor of the Company and not an employee of the Company.
21. Miscellaneous.
A. Headings. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
B. Enforceability. If any provision which is contained in this
Agreement should, for any reason, be held to be invalid or unenforceable in any
respect under the laws of any State of the United States, such invalidity or
unenforceability shall not affect any other provision of this Agreement.
Instead, this Agreement shall be construed as if such invalid or unenforceable
provisions had not been contained herein.
C. Notices. Any notice or other communication required or permitted
hereunder must be in writing and sent by either (i) certified mail, postage
prepaid, return receipt requested and First Class mail, (ii) overnight delivery
with confirmation of delivery, or (iii) facsimile transmission with an original
mailed by first class mail, postage prepaid, addressed as follows:
If to the Company: Scantek Medical, Inc.
0X Xxxx Xxxxx
Xxxxx Xxxxxx, XX 00000
Attention: Xx. Xxxxxxxx X. Xxxx
Facsimile No.: (000) 000-0000
If to Consultant: Xxxxxx Xxxxx
00 Xxxxxxxxx Xxxx.
Xxx Xxxxx, XX 00000
Facsimile No.: (000) 000-0000
or in each case to such other address and facsimile number as shall have last
been furnished by like notice. If mailing is impossible due to an absence of
postal service, and the other methods of sending notice set forth in this
Paragraph "C" of this Article "21"of this Agreement are not otherwise available,
notice shall be hand-delivered to the aforesaid addresses. Each notice or
communication shall be deemed to have been given as of the date so mailed or
delivered, as the case may be; provided, however, that any notice sent by
facsimile shall be deemed to have been given as of the date sent by facsimile if
a copy of such notice is also mailed by first class mail on the date sent by
facsimile; if the date of mailing is not the same as the date of sending by
facsimile, then the date of mailing by first class mail shall be deemed to be
the date upon which notice given.
D. Governing Law; Disputes. This Agreement shall in accordance with
Section 5-1401 of the General Obligations Law of New York in all respects be
construed, governed, applied and enforced under the internal laws of the State
of New York without giving effect to the principles of conflicts of laws and be
deemed to be an agreement entered into in the State of New York and made
pursuant to the laws of the State of New York. The parties agree that they shall
be deemed to have agreed to binding arbitration in New York, New York, with
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respect to the entire subject matter of any and all disputes relating to or
arising under this Agreement including, but not limited to, the specific matters
or disputes as to which arbitration has been expressly provided for by other
provisions of this Agreement. Any such arbitration shall be by a panel of three
arbitrators and pursuant to the commercial rules then existing of the American
Arbitration Association in the State of New York, County of New York. In all
arbitrations, judgment upon the arbitration award may be entered in any court
having jurisdiction. The parties agree, further, that the prevailing party in
any such arbitration as determined by the arbitrators shall be entitled to such
costs and attorney's fees, if any, in connection with such arbitration as may be
awarded by the arbitrators. In connection with the arbitrators' determination
for the purpose of which party, if any, is the prevailing party, they shall take
into account all of the factors and circumstances including, without limitation,
the relief sought, and by whom, and the relief, if any, awarded, and to whom. In
addition, and notwithstanding the foregoing sentence, a party shall not be
deemed to be the prevailing party in a claim seeking monetary damages, unless
the amount of the arbitration award exceeds the amount offered in a legally
binding writing by the other party by fifteen percent (15%) or more. For
example, if the party initiating arbitration ("A") seeks an award of $100,000
plus costs and expenses, the other party ("B") has offered A $50,000 in a
legally binding written offer prior to the commencement of the arbitration
proceeding, and the arbitration panel awards any amount less than $57,500 to A,
the panel should determine that B has "prevailed". The parties specifically
designate the courts in the City of New York, State of New York as properly
having jurisdiction for any proceeding to confirm and enter judgment upon any
such arbitration award. The parties hereby consent to and submit to personal
jurisdiction over each of them by the courts of the State of New York in any
action or proceeding, waive personal service of any and all process and
specifically consent that in any such action or proceeding, any service of
process may be effectuated upon any of them by certified mail, return receipt
requested, in accordance with Paragraph "D" of this Article "21" of this
Agreement.
The arbitration panel shall have no power to award non-monetary or
equitable relief of any sort. It shall also have no power to award (a) damages
inconsistent with any applicable agreement between the parties or (b) punitive
damages or any other damages not measured by the prevailing party's actual
damages; and the parties expressly waive their right to obtain such damages in
arbitration or in any other forum. In no event, even if any other portion of
these provisions is held invalid or unenforceable, shall the arbitration panel
have power to make an award or impose a remedy which could not be made or
imposed by a court deciding the matter in the same jurisdiction.
Discovery shall be permitted in connection with the arbitration only to
the extent, if any, expressly authorized by the arbitration panel upon a showing
of substantial need by the party seeking discovery.
All aspects of the arbitration shall be treated as confidential. The
parties and the arbitration panel may disclose the existence, content or results
of the arbitration only as provided in the rules of the American Arbitration
Association in New York, New York. Before making any such disclosure, a party
shall give written notice to all other parties and shall afford such parties a
reasonable opportunity to protect their interest.
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E. Construction. Each of the parties hereto hereby further
acknowledges and agrees that (i) each has been advised by counsel during the
course of negotiations; (ii) each counsel has had significant input in the
development of this Agreement and (iii) this Agreement shall not, therefore, be
construed more strictly against any party responsible for its drafting
regardless of any presumption or rule requiring construction against the party
whose attorney drafted this agreement.
F. Entire Agreement. The parties have not made any representations,
warranties or covenants with respect to the subject matter hereof which is not
set forth herein, and this Agreement constitutes the entire agreement between
them with respect to the subject matter hereof. All understandings and
agreements heretofore had between the parties with respect to the subject matter
hereof are merged in this Agreement which alone fully and completely expresses
their agreement. This Agreement may not be changed, modified, extended,
terminated or discharged orally, but only by an Agreement in writing, which is
signed by all of the parties to this Agreement.
G. Further Assurances. The parties agree to execute any and all
such other further instruments and documents, and to take any and all such
further actions which are reasonably required to consummate, evidence, confirm
or effectuate this Agreement and the intents and purposes hereof.
H. Binding Agreement. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their heirs, executors,
administrators, personal representatives, successors and assigns.
I. Waiver. Except as otherwise expressly provided herein, no waiver
of any covenant, condition, or provision of this Agreement shall be deemed to
have been made unless expressly in writing and signed by the party against whom
such waiver is charged; and (i) the failure of any party to insist in any one or
more cases upon the performance of any of the provisions, covenants or
conditions of this Agreement or to exercise any option herein contained shall
not be construed as a waiver or relinquishment for the future of any such
provisions, covenants or conditions, (ii) the acceptance of performance of
anything required by this Agreement to be performed with knowledge of the breach
or failure of a covenant, condition or provision hereof shall not be deemed a
waiver of such breach or failure, and (iii) no waiver by any party of one breach
by another party shall be construed as a waiver with respect to any other breach
of this Agreement.
J. Counterparts.This Agreement may be executed simultaneously in
one or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
K. Separate Counsel. The Consultant acknowledges having had
separate counsel of his own selection acting on his behalf in connection with
the negotiation, execution and consummation of this Agreement, and covenants
that he alone shall be liable and responsible for and shall not look to the
Company in connection with the fees and expenses of such separate counsel.
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L. Severability. The provisions of this Agreement shall be deemed
separable. Therefore, if any part of this Agreement is rendered void, invalid or
unenforceable, such rendering shall not affect the validity or enforceability of
the remainder of this Agreement.
IN WITNESS WHEREOF, the parties to this Agreement have set their hands
and seals or caused these presents to be signed of the day and year first above
written.
Scantek Medical, Inc.
By: /s/ Zsigmond X. Xxxx
---------------------------------
Xx. Xxxxxxxx X. Xxxx, President
/s/ Xxxxxx Xxxxx
-------------------------------------
Xxxxxx Xxxxx
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