CONSULTING AGREEMENT
This Consulting Agreement ("Agreement") is made on this 1st day of March
2001 by and between Xxxxx X. Xxxxxxxx, an individual, whose address is 00, Xxxxx
Xxx Xx, Xxxxxxxx, Xxxxx, U.K., ("Consultant") and STAAR Surgical Company, a
Delaware corporation, whose address is 0000 Xxxxxx Xxxxxx, Xxxxxxxx, Xxxxxxxxxx
00000 ("Company"), in reference to the following:
RECITALS
A. The Company is in the business of manufacturing and selling medical
products used for surgical implantation in the human eye.
B. The Company wishes to retain the Consultant, and the Consultant wishes
to be retained by the Company, to assist the Company to improve overall
financial performance and shareholder value.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Consultant
agree as follows:
AGREEMENT
1. Term. The Company retains the Consultant and the Consultant accepts this
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appointment with the Company for a continuous period with a minimum of twelve
(12) months.
2. Duties of Consultant. The Consultant will work from time to time on
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assignments of a varied nature as determined by the Company CEO to whom
Consultant will report directly.
3. Compensation. The Company shall pay to the Consultant, a minimum
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retainer of $9,000.00 (Nine Thousand Dollars) per month for 6 days work and this
sum will be payable whether or not Company can provide 6 days work. Should
Consultant work more than 6 days, he will be paid on a pro-rata per diem basis
of $1,500.00 (One Thousand and Five Hundred Dollars). Workdays will include all
time involved in travel associated with the assignment. Company will promptly
pay the amount owed Consultant into an account to be designated by Consultant on
the last day of each calendar month.
3.1 Issuance of Stock Option Grant. Immediately upon the issue of a
stock option grant of not less than 20,000 (Twenty Thousand) shares, the minimum
monthly retainer for 6 days consultancy will be reduced to $6,000.00 (Six
Thousand Dollars) with the pro-rata per diem for any additional days worked
being reduced to $1,000.00 (One Thousand Dollars).
3.2 Stock Option Grant. The Company will use its best efforts to
obtain a stock option grant for Consultant which will be for not less than
20,000 (Twenty Thousand) shares of common stock; the share option price will be
the price at which the stock closed on the last trading day prior to the grant
being issued. A total of 50% of the options will vest immediately at the time
the grant is issued, with the remaining 50% vesting on the first anniversary of
Agreement having been
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executed whether or not the grant is made after the date of execution of
Agreement. Should this Agreement continue in force for more than one year,
additional stock option grants of not less than 20,000 (Twenty Thousand) shares
will be issued annually with the same vesting formula as will apply to the
initial grant. Should Xxxxx Xxxxxx cease to be CEO of Company and as a result,
Consultant determines to terminate Agreement (with 30 day's notice), then any
unvested stock options will vest on the last day of Consultant's assignment -
even if this is less than 12 months from first date of execution of Agreement.
4. Nondisclosure.
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4.1 Property Belonging to Company. The Consultant agrees that all
developments, ideas, devices, improvements, discoveries, apparatus, practices,
processes, methods, concepts and products relating to microsurgical and/or
implantable devices, cryosurgical and/or colposcopic devices ("inventions")
developed during the term of this Agreement on the Company's time and with the
Company's equipment, supplies, facilities, or confidential proprietary
information are the exclusive property of the Company and shall belong to the
Company. The Consultant agrees to assign all such inventions to the Company, if
the Company so requests.
4.2 Property Belonging to Consultant. The Company agrees that the
Company shall have no rights in any invention that the Consultant develops
entirely on the Consultant's own time, without using the Company's equipment,
supplies, facilities, or confidential proprietary information, except for
inventions that either (i) relate, at the time the invention is conceived or
reduced to practice, to the Company's business or to actual or anticipated
research or development of the Company; or (ii) result from any work performed
by the Consultant for the Company.
4.3 Access to Confidential Information. The Consultant agrees that
during the term of the business relationship between the Consultant and the
Company, the Consultant will have access to and become acquainted with
confidential proprietary information which is owned by the Company and is
regularly used in the operation of the Company's business. The Consultant
acknowledges that all files, records, documents, drawings, specifications,
equipment and similar items relating to the business of the Company and to its
confidential proprietary information, whether they are prepared by the
Consultant or come into the Consultant's possession in any other way, shall
remain the exclusive property of the Company. Consultant will sign a standard
Company Confidentiality and Non-disclosure Agreement.
4.4 No Unfair Use by Consultant. The Consultant promises and agrees
that the Consultant shall not misuse, misappropriate, or disclose in any way to
any person or entity any of the Company's confidential proprietary information,
either directly or indirectly, nor will the Consultant use the confidential
proprietary information in any way or at any time except as required in the
course of the Consultant's business relationship with the Company. The
Consultant agrees that the sale or unauthorized use or disclosure of any of the
Company's confidential proprietary information which is obtained by the
Consultant during the Consultant's business relationship with the Company
constitutes unfair competition. The Consultant promises and agrees not to engage
in any unfair competition with the Company.
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4.5 Further Acts. The Consultant agrees that, at any time during the
term of this Agreement or any extension thereof, upon the request of the Company
and without further compensation, but at no expense to the Consultant, the
Consultant shall perform any lawful acts, including the execution of papers and
oaths and the giving of testimony, that in the opinion of the Company, its
successors or assigns, may be necessary or desirable in order to obtain,
sustain, reissue and renew, and in order to enforce, perfect, record and
maintain, patent applications and United States and foreign patents on the
Company's inventions, and copyright registrations on the Company's inventions.
4.6 Obligations Survive Agreement. The Consultant's obligations under
this section 4 shall survive the expiration or termination, for any reason, of
this Agreement.
4.7 Conflict of Interest. The Consultant is currently engaged by
Santen, Ltd. Company recognizes that some work may continue to be performed by
Consultant for Santen; provided that this does not represent a conflict of
interest. Consultant will not accept any engagements from any competitor of
Santen during the duration of Agreement.
5. Effect of Merger. This Agreement may be terminated by the Company in the
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event of any voluntary or involuntary dissolution of the Company resulting from
any merger or consolidation in which the Company is not the surviving
corporation or any transfer of all or substantially all of the assets of the
Company. In the event of such termination of the agreement, Consultant will be
paid an indemnity equal to 3 months minimum retainer and any unvested options
will immediately vest.
6. Termination without Cause.
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6.1 Termination. The Agreement is continuous with a minimum duration
of 12 months. Either party to the Agreement must give 3 months written notice of
an intention to terminate the Agreement unless termination is for cause. Upon
termination, any unvested options will immediately vest.
6.2 Termination Due to Death. This Agreement shall be terminated upon
the death of the Consultant and no further payments shall be made pursuant to
its terms.
6.3 Termination Due to Disability. The Company reserves the right to
terminate this Agreement immediately after the Consultant suffers any physical
or mental disability that, in the Company's sole determination, would prevent
the performance of the Consultant's duties under this Agreement. A termination
pursuant to this section shall be effected by giving ten days written notice of
termination to the Consultant.
6.4 Termination Not For Cause. Termination of this Agreement under
this section shall not be considered "for cause."
7. Termination for Cause.
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7.1 Termination for Cause. The Company reserves the right to
immediately terminate this Agreement if the Consultant willfully breaches or
habitually neglects the duties which he is required to perform under the terms
of this Agreement, or if he commits acts of dishonesty, fraud, or
misrepresentation, or if he engages in competition with the Company as
contemplated by sections 4 and 5 above. The Company reserves the right to
immediately terminate this Agreement if the Consultant fails to promptly and
faithfully comply with all present and future policies, requirements,
directions, requests and rules and regulations of the Company or fails to
conform to all laws and regulations or commits any act or becomes involved in
any situation or occurrence tending to bring the Company into public scandal or
ridicule or which will reflect unfavorably on the reputation of the Company.
7.2 Notice of Termination/No Election of Remedies. If the Company
terminates this Agreement pursuant to section 7.1 above, the Company shall give
written notice of termination to the Consultant without prejudice to any other
remedy to which the Company may be entitled, either at law or in equity, under
this Agreement.
7.3 Termination For Cause. Termination of this Agreement under this
section shall be considered termination "for cause."
8. Termination by Consultant. With the exception of the Consultant's
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obligations under section 4 of this Agreement, which represent a continuing
obligation of the Consultant and shall survive the termination or expiration of
this Agreement, the Consultant may terminate his obligations under this
Agreement by giving the Company at least thirty days written notice.
9. Status of Consultant. The Consultant understands and agrees that he is
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not an employee of the Company and that he shall not be entitled to receive
employee benefits from the Company, including, but not limited to, sick leave,
vacation, retirement, death benefits, or an automobile, except as provided for
in clause 11. The Consultant shall be responsible for providing, at the
Consultant's expense and in the Consultant's name, disability, worker's
compensation or other insurance as well as licenses and permits usual or
necessary for conducting the services hereunder. Furthermore, the Consultant
shall pay, when and as due, any and all taxes incurred as a result of the
Consultant's compensation hereunder, including estimated taxes, and shall
provide the Company with proof of said payments, upon demand. The Consultant
hereby indemnifies the Company for any claims, losses, costs, fees, liabilities,
damages or injuries suffered by the Company arising out of the Consultant's
breach of this section.
10. Representations by Consultant. The Consultant represents that the
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Consultant has the qualifications and ability to perform the services in a
professional manner, without the advice, control, or supervision of the Company.
The Consultant shall and does hereby indemnify, defend, and hold harmless the
Company, and the Company's officers, directors, and shareholders from and
against any and all claims, demands, losses, costs, expenses, obligations,
liabilities, damages, recoveries, and deficiencies, including, without
limitation, interest, penalties, and reasonable attorney fees and costs, that
the Company may incur or suffer and that arise, result from, or are related to
any breach or failure of the Consultant to perform any of the representations,
warranties and agreements contained in this Agreement.
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11. Business Expenses. The Company shall reimburse the Consultant for all
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reasonable business expenses incurred by the Consultant provided that each such
expenditure qualifies as a proper deduction on the Company's federal and state
income tax return. Each such expenditure shall be reimbursable only if the
Consultant furnishes to the Company adequate records and other documentary
evidence required by federal and state statutes and regulations issued by the
appropriate taxing authorities for the substantiation of that expenditure as an
income tax deduction. The expense category will be "business class" air travel
and equivalent level hotel accommodation/T&E/car rental or hire. The Company
will also reimburse communication and administrative expenses incurred in
conjunction with work performed for Company and also reasonable
life/travel/health insurance. The Company shall, in its sole discretion,
reimburse the Consultant or not, for any business expense which exceeds such
amount determined by Company and which is incurred by the Consultant without the
prior written consent of the Company. The Company will provide Consultant with a
$15,000.00 (Fifteen Thousand Dollar) advance to facilitate funding of initial
expenses, which will be reimbursed by Consultant upon termination of Agreement,
less any outstanding expensed owed by the Company to the Consultant.
12. Notices. Unless otherwise specifically provided in this Agreement, all
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notices or other communications (collectively and severally called "Notices")
required or permitted to be given under this Agreement, shall be in writing, and
shall be given by: (A) personal delivery (which form of Notice shall be deemed
to have been given upon delivery), (B) by telegraph or by private
airborne/overnight delivery service (which forms of Notice shall be deemed to
have been given upon confirmed delivery by the delivery agency), or (C) by
electronic or facsimile or telephonic transmission, provided the receiving party
has a compatible device or confirms receipt thereof (which forms of Notice shall
be deemed delivered upon confirmed transmission or confirmation of receipt).
Notices shall be addressed to the address set forth in the introductory section
of this Agreement, or to such other address as the receiving party shall have
specified most recently by like Notice, with a copy to the other party.
13. Choice of Law and Venue. This Agreement shall be governed according to
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the laws of the state of California. Venue for any legal or equitable action
between the Company and the Consultant which relates to this Agreement shall be
in the county of Los Angeles.
14. Entire Agreement. This Agreement supersedes any and all other
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agreements, either oral or in writing, between the parties hereto with respect
to the services to be rendered by the Consultant to the Company and contains all
of the covenants and agreements between the parties with respect to the services
to be rendered by the Consultant to the Company in any manner whatsoever. Each
party to this agreement acknowledges that no representations, inducements,
promises, or agreements, orally or otherwise, have been made by any party, or
anyone acting on behalf of any party, which are not embodied herein, and that no
other agreement, statement, or promise not contained in this Agreement shall be
valid or binding on either party.
15. Counterparts. This Agreement may be executed manually or by facsimile
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signature in two or more counterparts, each of which shall be deemed an
original, and all of which together shall constitute but one and the same
instrument.
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