Exhibit 10.11
SONTRA MEDICAL CORPORATION
INDEPENDENT CONTRACTOR AGREEMENT
THIS INDEPENDENT CONTRACTOR AGREEMENT ("Agreement") dated November 1,
2002 (the "Effective Date") is made between Sontra Medical Corporation and its
affiliates, successors, assigns and duly authorized representatives (the
"Company") and Xx. Xxxxxx X. Xxxxxx (the "Contractor"), for the purpose of
setting forth the exclusive terms and conditions by which the Company desires to
acquire Contractor's services on a temporary basis.
In consideration of the mutual obligations specified in this Agreement,
the parties, intending to be legally bound hereby, agree to the following:
1. Prior Agreement: The parties hereby rescind that certain
Consulting Agreement dated as of June 1, 1998 entered into by and between Sontra
Medical, Inc. and Xx. Xxxxxx X. Xxxxxx (the "Consulting Agreement"). As such,
the Consulting Agreement is of no further force and effect. In rescinding the
Consulting Agreement, the parties acknowledge and agree that the terms and
conditions of the Consulting Agreement and all obligations arising from such
terms and conditions, including any obligations intended to survive the
termination of such Consulting Agreement, are no longer enforceable.
2. Services:
(a) Company hereby retains Contractor, and Contractor hereby agrees
to perform for Company, certain services assigned to Contractor by the Company
in the Company's sole discretion, including, but not limited to, rendering
scientific advice and counsel to the Company in the "Consulting Field", wherein
"Consulting Field" is defined as any and all applications in ultrasound enhanced
diagnostics and transdermal drug delivery (collectively the "Services"):
(b) Contractor agrees to keep Company updated, promptly upon
Company's request, of any progress, problems, and/or developments of which
Contractor is aware regarding the Services. Company shall have the right to
require such updates in writing from Contractor in a format specified by Company
or acceptable to Company in its sole discretion.
3. Consideration/Compensation:
(a) In exchange for the full, prompt, and satisfactory performance
of all Services to be rendered to Company hereunder (as determined by the
Company), Company shall provide Contractor, as full and complete compensation
for the Services rendered hereunder, compensation consisting of (i) cash at a
rate of $4,916.67 per month (annualized compensation of $59,000), unless and
until directed otherwise in writing by the Chief Executive Officer of the
Company. Company shall remit payment to Contractor at then end of each month.
(b) Upon the approval of the Board of Directors of the Company,
following anticipated future action in 2003 by the Company's shareholders to
increase the pool of stock options available for distribution to employees,
consultants and directors of the Company, Contractor shall receive a
one-time grant of a non-qualified stock option, fully exercisable as of the date
of grant to purchase that number of shares of common stock, par value $.01, of
the Company, equal in value to $61,000 as determined based on the market value
of the Company's common stock as of the date of grant (the "Option"). The Option
will be subject to the terms and conditions of the Company's 1997 Long-Term
Incentive and Stock Option Plan, as amended, or such other stock option plan
approved by the shareholders of the Company.
(c) Contractor shall not be entitled to receive any other
compensation or any benefits from Company. Except as otherwise required by law,
Company shall not withhold any sums or payments made to Contractor for social
security or other federal, state or local tax liabilities or contributions, and
all withholdings, liabilities, and contributions shall be solely Contractor's
responsibility. Further, Contractor understands and agrees that the Services are
not covered under the unemployment compensation laws and are not intended to be
covered by workers' compensation laws.
4. Nondisclosure:
(a) Contractor understands that, in connection with his engagement
with Company, he may receive, produce, or otherwise be exposed to Company's
Confidential Information, which is defined as any information concerning the
organization, business or finances of the Company or of any third party which
the Company is under an obligation to keep confidential and that is maintained
by the Company as confidential. Such Confidential Information shall include, but
is not limited to, trade secrets or proprietary or confidential information
respecting existing and future products and services, inventions, designs,
methods, formulas, drafts of publications, research, know-how, techniques,
systems, databases, processes, software programs or code, developments or
experimental work, works of authorship, customer lists and/or customer
information, business plans, marketing plans, financial information, sales
techniques, projects, the Company's salary and/or pay rates, other Company
personnel information, and all other plans and proposals.
(b) Contractor acknowledges that the Confidential Information is the
Company's sole, exclusive and extremely valuable property. Accordingly,
Contractor agrees to segregate all Confidential Information from information of
other companies and agrees not to reproduce any Confidential Information without
Company's prior written consent, not to use the Confidential Information except
in the performance of this Agreement, and not to divulge all or any part of the
Confidential Information in any form to any third party, either during or after
the term of this Agreement, except to Company employees and Contractor
Employees, if any, who need to know such Confidential Information in order to
perform the Services. Contractor shall require such Contractor Employees to
execute a nondisclosure agreement satisfactory to the Company before such
Contractor Employee is exposed to any Confidential Information. Upon termination
or expiration of this Agreement for any reason, Contractor agrees to cease using
and to return to Company all whole and partial copies and derivatives of the
Confidential Information, whether in Contractor's possession or under
Contractor's direct or indirect control, including any computer access nodes
and/or codes, and to arrange for the return of such materials by all Contractor
Employees.
(c) Contractor shall not disclose or otherwise make available to
Company in any manner any confidential and proprietary information received by
Contractor from third parties. Contractor
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warrants that his performance of all the terms of this Agreement does not and
will not breach any agreement entered into by Contractor with any other party,
and Contractor agrees not to enter into any agreement, oral or written, in
conflict herewith. In addition, Contractor recognizes that the Company has
received and in the future will receive from third parties their confidential or
proprietary information subject to a duty on the Company's part to maintain the
confidentiality of such information and to use such information only for certain
limited purposes. Contractor agrees that he owes the Company and such third
parties, during the term of the Contractor's relationship with the Company and
thereafter, regardless of the reason for the termination of the relationship, a
duty to hold all such confidential or proprietary information in the strictest
of confidence and not to disclose such information to any person, firm or
corporation (except as necessary in carrying out his work for the Company
consistent with the Company's agreement with such third party) or to use such
information for the benefit of anyone other than for the Company or such third
party (consistent with the Company's agreement with such third party).
(d) Contractor also agrees that during his consultancy with the
Company that he shall not make, use or permit to be used any Company Property
otherwise than for the benefit of the Company. The term "Company Property" shall
include all notes, memoranda, reports, lists, records, drawings, sketches,
designs, specifications, software programs, software code, data, computers, palm
pilots and their equivalents, cellular telephones, pagers, credit and/or calling
cards, keys, access cards, documentation or other materials of any nature and in
any form, whether written, printed, electronic or in digital format or
otherwise, relating to any matter within the scope of the business of the
Company or concerning any of its dealings or affairs, and any other Company
property in his possession, custody or control. Contractor further agrees that
he shall not, after the termination of his consultancy, use or permit others to
use any such Company Property. Contractor acknowledges and agrees that all
Company Property shall be and remain the sole and exclusive property of the
Company. Immediately upon the termination of Contractor's consultancy,
Contractor shall deliver all Company Property in his possession, and all copies
thereof, to the Company.
5. Ownership of Work Product:
(a) Contractor agrees to promptly disclose to Company any and all
Work Product. "Work Product" includes without limitation any and all notes,
drawings, designs, technical data, know how, works of authorship, firmware,
software, ideas, improvements, inventions, material, information, work or
product conceived, created, written or first reduced to practice by Contractor
either solely or jointly with others in the performance of consulting services
for Company and/or resulting from use of Confidential Information by Contractor
solely or jointly with others. Contractor agrees to assign and does hereby
assign to Company his entire right, title and interest, including without
limitation any copyright, patent, trade secret, trademark (including the good
will associated therewith) or other intellectual property rights in and to the
Work Product. All works of authorship, firmware, software or other applicable
Work Product shall be considered works for hire by Contractor for Company and
all Work Product shall be the Company's sole and exclusive property. Contractor
agrees to and shall provide Company with all Work Product generated on Company's
behalf.
(b) Contractor hereby grants to Company under any and all
intellectual property rights a non-exclusive, irrevocable, royalty free, and
worldwide license to use all notes, works of authorship,
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ideas, designs, firmware, software, technical data, ideas, research, reports,
and other such inventions which are not Work Product, but which are owned by
Contractor and are necessary or desirable to use any Work Product delivered by
Contractor to Company (individually and collectively, "Background Material")
including, without limitation, the right to make, have made, sell, offer for
sale, rent, lease, import, copy, create derivative works, display, perform, and
distribute the Background Material.
(c) Contractor further agrees:
(i) to apply for, obtain, register and vest in the name of
the Company alone (unless the Company otherwise directs)
patents, copyrights, trademarks or other analogous
protection in any country throughout the world and when
so obtained or vested to renew and restore the same; and
(ii) to defend any judicial, opposition or other proceedings
in respect of such applications and any judicial,
opposition or other proceedings or petitions or
applications for revocation of such patent, copyright,
trademark or other analogous protection.
(d) Contractor also agrees, at the request and cost of Company, to
promptly sign, execute, make and do all such deeds, documents, acts and things
as Company may reasonably require or desire to perfect Company's entire right,
title, and interest in and to any Work Product and/or Background Material.
Contractor agrees that if Company is unable because of Contractor's
unavailability, or for any other reason, to secure the signature of an
authorized agent of Contractor to apply for or to pursue any application for any
United States or foreign patents, copyright or trademark registrations covering
the assignments to Company, then Contractor hereby irrevocably designates and
appoints Company and its duly authorized officers and agents as Contractor's
agent and attorney in fact, to act for and in Contractor's behalf and stead to
execute and file any such applications and to do all other lawfully permitted
acts to further the prosecution and issuance of patents, copyright, and
trademark registrations thereon with the same legal force and effect as if
executed by an authorized agent of Contractor.
(e) Contractor warrants that it has good and marketable title to the
Background Material and Work Product and that he shall not knowingly incorporate
into any Work Product any material that would infringe any copyright, trade
secret, trademark or other intellectual property rights of any person or entity.
Contractor further warrants that the Background Material and Work Product shall
be free and clear of all liens, claims, encumbrances or demands of third
parties, including any claims by any such third parties of any right, title or
interest in or to the Background Material and/or Work Product arising out of any
patent, trade secret, copyright or other intellectual property right. Contractor
shall indemnify, defend and hold harmless the Company and its customers from any
and all liability, loss, cost, damage, judgment or expense (including reasonable
attorney's fees) resulting from or arising in any way out of any such claims by
any third parties, and/or which are based upon, or are the result of any breach
of, the warranties contained in this Section 4. In the event of a breach of the
warranties set forth in this Section 4, in addition to all other remedies
available to Company, Contractor shall, at no additional cost to Company,
replace or modify the Work Product within a reasonable time, with a functionally
equivalent and conforming Work Product at his/her own
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expense, or obtain for Company the right to continue using the Work Product and
in all other respects use his/her best efforts to remedy the breach.
6. Noncompetition; Nonsolicitation. During the period of this
Agreement and for one year thereafter, Contractor shall not, directly or
indirectly, alone or as a partner, joint venturer, consultant, contractor,
lender, officer, director, employee, shareholder or investor of any entity,
engage in any business or activity within the United States which is in
competition with the products or services which, during such period, are being
or are proposed to be created, developed, manufactured, marketed, distributed or
sold by the Company. Further, during the period of this Agreement and for one
year thereafter, Contractor shall not, directly or indirectly, alone or as a
partner, joint venturer, consultant, contractor, lender, officer, director,
employee, shareholder or investor of any entity, (a) solicit or do business with
any customer of the Company or any potential customer of the Company with whom
Contractor has had contact or about whom he has obtained Confidential
Information, or (b) recruit or solicit for hire any person who is or was an
employee, agent, representative or consultant of the Company at any time during
the term of this Agreement or during the period of one year thereafter, or in
any manner seek to solicit or induce any such person to leave his employment
with the Company, or assist in the recruitment or hiring of any such person.
Contractor's record or beneficial ownership of not more than five percent (5%)
of the outstanding publicly traded capital stock of any entity shall not be
deemed, in and of itself, to be in violation of this Paragraph.
7. Indemnification/Release:
(a) Contractor agrees to take all necessary precautions to prevent
injury to any persons (including employees of Company) or damage to property
(including Company's property) during the term of this Agreement, and shall
indemnify, defend and hold harmless Company, its officers, directors,
shareholders, employees, representatives and/or agents from any claim,
liability, loss, cost, damage, judgment, settlement or expense (including
attorney's fees) resulting from or arising in any way out of injury (including
death) to any person or damage to property arising in any way out of any act,
error, omission or negligence on the part of Contractor or any Contractor
Employee in the performance or failure to fulfill any Services or obligations
under this Agreement. Contractor further agrees to indemnify, defend and hold
harmless Company, its officers, directors, shareholders, employees,
representatives and/or agents from the costs to Company of remedying any
violation or breach of this Agreement by Contractor and/or from the costs to the
Company resulting from a breach by Contractor to a third party during the
performance of the Services under this Agreement.
(b) Contractor agrees to indemnify and hold the Company harmless
from and against any and all claims, losses, demands, liabilities, damages,
costs, or expenses (including, without limitation, attorney's fees, back wages,
liquidated damages, penalties or interest) resulting from any violation of any
federal, state or local law, regulation, or ordinance by Contractor, including,
without limitation, Contractor's failure to collect, withhold, or pay any and
all federal or state taxes required to be withheld or paid by employers or
employees, including, without limitation, any and all income tax, social
security, and FUTA taxes.
(c) In remedying any violation of this Agreement by Contractor, the
Company shall first notify Contractor of the existence of such violation and
provide Contractor thirty (30) days in which to remedy the violation at
Contractor's expense.
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8. Termination: This Agreement shall be effective on the date
hereof and shall continue until terminated by either party upon written notice.
In the event of termination, Contractor shall, upon request, perform such work
as may be requested to transfer work in process to the Company or to a party
designated by the Company.
9. Independent Contractor:
(a) Company and Contractor expressly agree and understand that
Contractor is an independent contractor and nothing in this Agreement nor the
services rendered hereunder is meant, or shall be construed in any way or
manner, to create between them a relationship of employer and employee,
principal and agent, partners or any other relationship other than that of
independent parties contracting with each other solely for the purpose of
carrying out the provisions of this Agreement. Contractor is not the agent of
Company and is not authorized and shall not have the power or authority to bind
Company or incur any liability or obligation, or act on behalf of Company. At no
time shall Contractor represent that he is an agent of the Company, or that any
of the views, advice, statements and/or information that may be provided while
performing the Services are those of the Company.
(b) While Company is entitled to provide Contractor with general
guidance to assist Contractor in completing the scope of work to Company's
satisfaction, Contractor is ultimately responsible for directing and controlling
the performance of the task and the scope of work, in accordance with the terms
and conditions of this Agreement. Contractor shall use his best efforts, energy
and skill in his own name and in such manner as he sees fit.
10. Contractor Warranties:
(a) The execution and performance of this Agreement will not
constitute a breach or default under any contract or instrument to which
Contractor is a party, or by which he is bound, including, without limitation,
any and all employment, noncompetition and nondisclosure agreements with any
former employer or customer, and Contractor is under no contractual or other
obligation to any third party which would prevent or limit his performance or
services under this Agreement.
(b) Contractor has complied with all federal, state, and local laws
regarding business permits and licenses that may be required to carry out the
services to be performed under this Agreement.
(c) Contractor is free to disclose to the Company, without breach of
any obligation to a third party, any and all information, ideas, suggestions,
developments, or know-how that Contractor will divulge in performing the
services under this Agreement.
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11. General:
(a) This Agreement does not create an obligation on Company to
continue to retain Contractor beyond this Agreement's termination.
(b) This Agreement may not be changed unless mutually agreed upon in
writing by both Contractor and by an authorized officer of the Company.
(c) Sections 1, 3, 4, 5, 6, 7, 8, 9 and 10 shall survive the
termination of this Agreement regardless of the manner of such termination.
(d) Any waiver by Company of a breach of any provision of this
Agreement shall not operate or be construed as a waiver of any subsequent breach
of such provision or any other provision hereof.
(e) Contractor hereby agrees that each provision herein 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. Moreover, if one or more of the provisions contained in this Agreement
shall for any reason be held to be excessively broad as to scope, activity,
subject or otherwise so as to be unenforceable at law, such provision or
provisions shall be construed by the appropriate judicial body by limiting or
reducing it or them, so as to be enforceable to the maximum extent compatible
with the applicable law as it shall then appear.
(f) Company shall have the right to assign this Agreement to its
successors and assigns, and this Agreement shall inure to the benefit of and be
enforceable by said successors or assigns. Contractor may not assign this
Agreement or any rights or obligations hereunder without the prior written
consent of Company's Chief Executive Officer, and this Agreement shall be
binding upon Contractor's heirs, executors, administrators and legal
representatives.
(g) This Agreement and all aspects of the relationship between the
parties hereto shall be construed and enforced in accordance with and governed
by the internal laws of the Commonwealth of Massachusetts without regard to its
conflict of laws provisions. The Contractor further agrees that any claims or
legal actions by one party against the other arising out of the relationship
between the parties contemplated herein (whether or not arising under this
Agreement) shall be commenced and maintained in any state or federal court
located in Massachusetts, and Contractor hereby submits to the jurisdiction and
venue of any such court.
(h) This Agreement sets forth the complete, sole and entire
agreement between the parties with respect to the subject matter herein and
supersedes any and all other agreements, negotiations, discussions, proposals,
or understandings, whether oral or written, previously entered into, discussed
or considered by the parties, including without limitation, the June 1, 1998
Consulting Agreement entered into by and between the parties.
(i) The language of all parts of this Agreement will in all cases be
construed as a whole in accordance with its fair meaning and not strictly for or
against either party hereto.
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(j) Contractor further agrees that any breach of this Agreement by
him will cause irreparable damage to the Company and that in the event of such
breach the Company shall have, in addition to any and all remedies of law, the
right to an injunction, specific performance or other equitable relief to
prevent Contractor from violating his obligations hereunder.
(k) All notices provided for in this Agreement shall be given in
writing and shall be effective when either served by hand delivery, express
overnight courier service, or by registered or certified mail, return receipt
requested, addressed to the parties at their respective addresses: for the
Company: 00 Xxxxxxx Xxxxxx, Xxxxxxxxx, XX 00000; for the Contractor: 00 Xxxxxxxx
Xxxx, Xxxxxx, XX 00000, or to such other address or addresses as either party
may later specify by written notice to the other.
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IN WITNESS WHEREOF, the parties hereto have executed this Independent
Contractor Agreement.
XX. XXXXXX X. XXXXXX: SONTRA MEDICAL CORPORATION:
/s/ Xxxxxx X. Xxxxxx By: Xxxxxx X. Xxxxxxx
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Signature
Title: President & CEO
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Date: 12/19/02 Date: 01/02/03
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