Exhibit 99.1
Execution Copy
CONSULTING
AGREEMENT
THIS CONSULTING AGREEMENT dated as
of May 4, 2007 (the “Agreement”), is entered into by
and between Ortho-Medical Products, Inc. (the
“Company”), a New York corporation and Marc Waldman
(the “Consultant”).
RECITALS
WHEREAS, the Consultant has provided
services to the Company for several years; and
WHEREAS, the Company wishes to
retain the services of Consultant and Consultant desires to
continue to render services to the Company; and
WHEREAS, the Company and Consultant
deem it to be in their respective best interests to enter into an
agreement providing for the Company’s retainer of Consultant
on the terms and conditions set forth below.
NOW, THEREFORE, in consideration of
the foregoing and the mutual covenants, representations,
agreements, and promises set forth herein and other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:
AGREEMENT
1.
Consulting .
1.1
Term . The Company agrees to retain the Consultant as
General Manager of the Company and the Consultant agrees to accept
such consulting position, for a period of two (2) years commencing
as of the date of this Agreement or for such longer term as the
Company and the Consultant may agree in writing, but subject to the
termination provisions of Section 3 hereof (the
“Term”).
1.2
Duties . During the Term, as General Manager of the Company,
Consultant shall perform such duties and functions as are
reasonably assigned to him by the Board of Directors of the Company
(the “Board”) and/or President of the Company (the
“President”) that are consistent with
Consultant’s title, position and level of time commitment
that he has agreed to devote to the Company. Consultant shall
adhere in all material respects to all of the Company’s
policies and procedures applicable to someone holding his position,
except to the extent such policies or procedures may conflict with
the terms of this Agreement, in which case the provisions hereof
shall control, or applicable law.
1.3
Time Devoted to Consulting. Consultant agrees to devote such
amount of time per month to his duties as General Manager as shall
be mutually agreed by him and the Company from time to time during
the Term hereof. In determining the amount of time that
Consultant shall devote to his duties hereunder, the parties shall
take into account, among other things, the time that the Consultant
is required to devote to his responsibilities under his Financial
Consulting Agreement with Andover Medical Inc. and other
professional commitments, endeavors and investments of the
Consultant. At all times that he is working on behalf of the
Company hereunder, Consultant agrees to use his good faith efforts
to promote the success of the Company’s business and will
cooperate with all reasonable requests of the Board in order to
advance the best interests of the Company.
1.4
Location of Consulting. Consultant’s principal place
of consulting shall be at the Company’s principal office
located at 210 Jericho Turnpike, Mineola, New York 11501 or at
another office that may be mutually agreed by Consultant and the
Company.
2.
Compensation and Related Matters .
2.1
Consulting Fee. As compensation for services rendered
hereunder, during the Term the Company shall pay the Consultant a
fee of $62,000 per annum or such higher amount as the Company, in
its sole judgment and discretion, may provide during the Term (the
“Annual Consulting Fee”), which amount shall be paid
monthly.
2.2
Additional Compensation. As additional consideration
for the execution of this Agreement, the Consultant is hereby
granted a one-time grant of stock options for 50,000 shares of
Common Stock of Andover Medical, Inc. at an exercise price per
share equal to the average of the closing price of such stock on
each of the last ten (10) trading days immediately prior to the
date hereof (the “Options”). The Options shall be
issued in accordance with the terms of the Andover Medical, Inc.
2006 Employee Stock Incentive Plan except to the extent otherwise
provided in this Agreement, in which case the terms hereof shall
apply. All Options shall vest in 24 equal monthly
installments, and be exercisable by Consultant in whole or in part
at any time on and after the date hereof and through their
expiration date. The Options shall not be revocable or cancelable
in connection with the termination of this Agreement by any party
for any reason. In addition, the Company hereby grants to the
Consultant “piggyback” registration rights with respect
to all shares of Common Stock issuable upon exercise of the
Options, such that the Consultant shall have the right to require
the Company to include such shares in its next subsequent
registration statement on Form S-8 under the Securities Act of
1933, as amended, which the Company files after the exercise of any
Options, or on any other subsequent registration statement subject,
however, to customary exceptions, pro rata scale-back requests by
underwriters (if any), indemnification provisions and other terms
and conditions generally applicable to other holders of
“piggyback” registration rights with respect to the
Company’s Common Stock. The Company agrees to pay all costs
and expenses associated with registering the Consultant’s
shares.
2.3
Expense Reimbursement . Consultant shall be entitled
to reimbursement of reasonable and necessary business expenses
incurred by him in the course of providing services to the Company,
subject to appropriate documentation and in accordance
with
2
the budgets and guidelines
established by the Company from time to time. Any travel
required to be taken by the Consultant hereunder shall be in
economy class.
2.4
Indemnification of Consultant . Consultant shall be
entitled to be indemnified by the Company, to the fullest extent
permitted by applicable law and the organizational documents of the
Company, against any losses, damages, liabilities, claims, actions,
judgments, costs and expenses (including without limitation,
attorneys’ fees and expenses) that may be incurred by him in
the course of, or in connection with, the performance of his duties
hereunder.
2.5
Relationship Between Parties . The Consultant is
retained by the Company only for the purposes and to the extent set
forth in this Agreement, and his relation to the Company shall,
during the period or periods of his rendering services hereunder,
be that of an independent contractor. Thus, the Consultant
shall be at liberty to dispose of such portion of his time, energy,
and skill during regular business hours that he is not obligated to
devote to the Company pursuant to this Agreement, in such manner as
he sees fit, subject to the terms of any restrictive covenant which
binds the Consultant. The Consultant shall not be considered
under the provision of this Agreement or otherwise as having an
employee status or as being entitled to participate in any plans,
arrangements, or distributions by the Company pertaining to or in
connection with any benefits provided or offered to the
Company’s regular employees, including but not necessarily
limited to, any such plan, arrangement or distribution related to
medical, health, dental, disability, life insurance, pension, stock
bonus, profit sharing, or similar benefits.
3.
Termination of Consulting .
3.1
Termination . The Consultant’s consulting hereunder
may be terminated prior to the end of the Term of this Agreement
under the following circumstances:
(a)
Death . The Consultant’s
consulting hereunder shall terminate upon his death.
(b)
Disability.
If, as a result
of the incapacity of the Consultant due to physical or mental
illness, the Consultant shall have been wholly incapable of
performing his duties with the Company for a continuous period of
not less than four (4) months during any twelve (12) month period,
his consulting may be terminated by the Company for
“Disability” after delivering a written Notice of
Termination to the Consultant with respect thereto.
(c)
Cause . Termination by the Company
of the consulting of the Consultant for “Cause” shall
mean termination based upon the Consultant’s (i) willful
breach or willful and gross neglect of his duties and
responsibilities, (ii) criminal conviction of a felony or a crime
of moral turpitude or a plea of nolo contendere to either of the
foregoing, occurring on or after the execution of this Agreement,
(iii) material
3
breach of this
Agreement (iv) acts of fraud, dishonesty, misappropriation or
embezzlement, (v) violation of any material Legal Requirement (as
defined in Section 7.2 below), (vi) willful breach of his duty of
loyalty or fiduciary duties, or (vii) willful failure to comply
with the Company’s reasonable orders or directives or the
Company’s reasonable rules, regulations, policies, procedures
or practices; provided , however , that in the case
of any act or failure to act described in sub-sections (i), (iii),
(v), (vi), or (vii) above, such act or failure to act shall not
constitute Cause if, within ten (10) days after Notice of
Termination (containing a description of the behavior allegedly
constituting the “Cause”) is given to the Consultant by
the Company, Consultant has corrected such act or failure to act,
to the reasonable satisfaction of the Board.
(d)
Good
Reason . The Consultant may
terminate his consulting during the Term of this Agreement for
“Good Reason.” Good Reason shall mean the
Company’s material breach of this Agreement, a material
reduction in the Consultant’s duties or authority or a
requirement that Consultant relocate to an area outside of a radius
of 50 miles of Mineola, New York, which breach shall not be cured
by the Company within ten (10) days after Notice of Termination is
given by the Consultant.
3.2
Date of Termination. “Date of Termination” shall
mean (a) the expiration of the Term, (b) if the Consultant’s
consulting is terminated due to his death, the date of his death,
(c) if the Consultant’s consulting is terminated due to
Consultant’s Disability, ten (10) days after Notice of
Termination is given to the Consultant, and (d) if the
Consultant’s consulting is otherwise terminated by the
Company or by Consultant, the date upon which the for Cause or Good
Reason event occurs or such other date set forth in the Notice of
Termination. Nothing in this Section shall be deemed to diminish
the Company’s right to cause the Consultant to cease
performing his duties and responsibilities as a consultant of the
Company at any time (“Termination Without Cause”), or
to limit either party’s right to give a Notice of Termination
at any time during the Term of this Agreement.
3.3
Notice of Termination. Any purported termination of the
Consultant’s consulting by the Company or by the Consultant
shall be communicated by written Notice of Termination to the other
party hereto in accordance with Paragraph 8.4 of this Agreement.
For purposes of this Agreement, a “Notice of
Termination” shall mean a written notice which shall indicate
the specific termination provision in this Agreement relied upon,
and shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the
Consultant’s consulting under the provision so
indicated.
4
4.
Compensation Upon Termination .
4.1
Disability . In the event the Consultant’s consulting
is terminated by reason of Disability, the Consultant shall be
compensated as follows: (a) all earned, but unpaid amounts of
Annual Consulting Fee to which the Consultant was entitled as of
the Date of Termination through and including the last date of the
month following Consultant’s Disability, and (b) all
unreimbursed business expenses incurred through the Date of
Termination, shall be paid in accordance with the terms of this
Agreement to the Consultant. Thereafter, the Company shall
have no further obligations to the Consultant under this Agreement,
except pursuant to Section 2.4.
4.2
Death. In the event the Consultant’s consulting is
terminated by reason of his death, the Consultant’s
beneficiary or estate shall be compensated as follows: (a) all
earned, but unpaid amounts of Annual Consulting Fee, to which the
Consultant was entitled as of the Date of Termination through and
including the last date of the month following Consultant’s
death, and (b) all unreimbursed business expenses incurred through
the Date of Termination, shall be paid in accordance with the terms
of this Agreement to the Consultant’s beneficiary, or, if no
beneficiary has been designated by the Consultant in a written
notice prior to his death, to the Consultant’s estate.
Thereafter, the Company shall have no further obligations to the
Consultant’s beneficiary or estate under this Agreement,
except pursuant to Section 2.4.
4.3
Cause; Termination by Consultant Without Good Reason . In
the ev
|
