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Exhibit
10.44
CONSULTING
AGREEMENT
This Consulting Agreement
(“Agreement”) is made and entered into effective as of
July 1, 2007 (“Effective Date”), by and between
Dr. John A. Wise (“Consultant”) and Natural
Alternatives International, Inc., a Delaware corporation
(“Company”). Company and Consultant may be referred to
collectively as the “Parties.”
RECITALS
A. Consultant has expertise
in all areas of Company’s business and has been employed by
Company most recently as Chief Scientific Officer. Consultant has
agreed to transition from full time employment to consulting work
for Company.
B. This Agreement is intended
to replace Consultant and Company’s current Amended and
Restated Employment Agreement dated effective January 30,
2004. Consultant, in consideration of terminating his employment
with Company and in consideration of replacing the Amended and
Restated Employment Agreement dated effective January 30,
2004, with this Agreement, is willing to provide consulting
services to Company on the terms and conditions specified in this
Agreement.
C. Company is willing to
engage Consultant as an independent contractor, and not as an
employee, on the terms and conditions specified in this
Agreement.
In consideration of and
incorporating the foregoing recitals as if fully set forth below
and intending to be legally bound, the Parties agree as
follows:
AGREEMENT
1. Engagement .
Consultant accepts the offer of Company to act as an independent
contractor to provide consulting services for Company on the terms
and conditions specified in this Agreement. Consultant’s
services may be terminated by either Consultant or Company at any
time for any reason or no reason, with or without Cause (defined
below), upon written notice to the other or without any notice upon
the death of Consultant. The status of the consulting relationship
may not be modified except by an agreement in writing signed by the
President or Chief Executive Officer of Company and by Consultant,
the terms of which must be approved in advance in writing by
Company’s Board of Directors.
2. Term . This
Agreement will commence on the Effective Date and shall terminate
exactly two (2) years and six (6) months after
commencement (“Term”). Consultant and Company
understand and agree nothing Consultant or Company does during the
Term can be construed to create an implied or express contract of
employment contrary to this Agreement.
3. Description of
Services of Consultant . Consultant’s schedule under
this Agreement on a given day shall generally be subject to
Consultant’s discretion provided Consultant and Company
anticipate Consultant shall be available to work on such matters as
the President of the Company may identify from time to time
following reasonable notice. It is anticipated Consultant may be
asked by the President of the Company to travel on
occasion
following reasonable notice to other
locations including other offices of the Company and its
subsidiaries both within and outside the United States. Consultant
represents to Company that Consultant has no other outstanding
commitments inconsistent with any of the terms of this Agreement or
the services to be rendered under it. Upon the request of Company,
Consultant agrees to testify in any proceeding designated by
Company.
4. Compensation
.
a. Consulting Fee
. During the Term, Company agrees to pay Consultant a monthly
consulting fee of Ten Thousand Dollars per month ($10,000) payable
no less frequently than monthly. Company shall not be responsible
for withholding income or other taxes from any fees or expenses
paid to Consultant. Consultant shall be solely responsible for
filing all returns and paying any income, social security or other
tax levied upon or determined with respect to the payments made to
Consultant pursuant to this Agreement.
b. Additional
Benefits . During the Term, Consultant shall not be
entitled to receive and/or participate in any benefits normally
associated with his previous employment with Company. However, in
consideration of Consultant terminating his employment with
Company, terminating his Amended and Restated Employment Agreement
dated effective January 30, 2004, and entering into this
Agreement, Consultant will be entitled, during the Term, to receive
continuing group health insurance coverage pursuant to COBRA and
Company will pay directly to the provider on behalf of Consultant
the first eighteen (18) months premiums for such continuation
coverage. Company agrees, during the Term, to pay an additional
twelve (12) months premiums following the first 18 months
premiums if such coverage remains available to Consultant. In the
event Consultant is not entitled to receive continuing group health
insurance coverage pursuant to COBRA beyond the first 18 months of
the Term, Company will provide to Consultant for a supplementary
twelve (12) months as additional monthly compensation for the
remaining Term, the same dollar amount per month expended on
premiums for such continuation coverage in the first 18 months. In
the event Consultant finds alternate employment following the
Effective Date of this Agreement after which Consultant no longer
requires COBRA continuation coverage, Company will have no further
obligation to pay the balance of any such unused continuation
coverage to Consultant.
c. Stock Options
. Company and Consultant acknowledge and agree as of the
Effective Date of this Agreement, Consultant holds the Incentive
and Nonqualified stock options to buy shares of Company’s
common stock in the amounts and subject to the terms and conditions
set forth on attached and incorporated Exhibit A (collectively, the
“Options”). Company and Consultant acknowledge and
agree pursuant to the terms of the Options and the Company’s
1999 Omnibus Equity Incentive Plan under which the Options were
granted, each of the Options will remain in effect and exercisable
following Consultant’s change in status from an employee of
Company to independent contractor under this Agreement as
follows:
i. With respect to the
Incentive Stock Option granted August 28, 2000, (40,000 shares
outstanding, fully vested) and the Incentive Stock Option granted
September 8, 2003, (24,427 shares outstanding, fully vested),
Consultant may exercise these Incentive Stock Options within three
(3) months from the Effective Date of this Agreement.
To
the extent Consultant does not exercise
these Incentive Stock Options within three (3) months from the
Effective Date, the Incentive Stock Options granted August 28,
2000, and September 8, 2003, shall terminate.
ii. With respect to the
Incentive Stock Option granted September 8, 2003, (5,473
shares of which are outstanding, fully vested and now treated as a
Nonqualified Stock Option), Consultant may exercise this
Nonqualified Stock Option within three (3) months from the
Effective Date of this Agreement. To the extent Consultant does not
exercise this Nonqualified Stock Option within three
(3) months from the Effective Date, the Nonqualified Stock
Option granted September 8, 2003, shall terminate.
iii. With respect to the
Incentive Stock Option granted January 30, 2004, (25,893
shares outstanding, fully vested and now treated as a Nonqualified
Stock Option), Consultant may exercise this Nonqualified Stock
Option by the option expiration date of January 29, 2009, or
12 months following termination of this Agreement, whichever date
is earlier. To the extent Consultant does not exercise this
Nonqualified Stock Option the earlier of January 29, 2009, or
12 months following termination of this Agreement, this
Nonqualified Stock Option shall terminate.
iv. With respect to the
Nonqualified Stock Option granted January 30, 2004, (34,107
shares outstanding, fully vested ), Consultant may exercise this
Nonqualified Stock Option by the option expiration date of
January 29, 2009, or 12 months following termination of this
Agreement, whichever date is earlier. To the extent Consultant does
not exercise this Nonqualified Stock Option the earlier of
January 29, 2009, or 12 months following termination of this
Agreement, this Nonqualified Stock Option shall
terminate.
d. Expenses .
Expenses incurred by Consultant in connection with services
provided by Consultant and authorized in advance in writing by
Company shall be reimbursed by Company to Consultant. Consultant
acknowledges and agrees Consultant is solely responsible for
procuring and paying for the services of any legal or other
professional service necessary or appropriate for the performance
of Consultant’s services.
e. No Other
Compensation . Consultant acknowledges and agrees, except
as expressly provided in this Agreement, Consultant is not entitled
to any other compensation or benefits from the Company.
5. Termination of
Agreement .
a. Due to Death
. Consultant’s services shall terminate automatically in
the event of Consultant’s death. Company shall have no
obligation to Consultant or Consultant’s estate for payment
of the monthly consulting fee or any other form of compensation or
benefit other than amounts accrued through the date of
Consultant’s death.
b. With Cause, No
Compensation Due . Company may terminate this Agreement for
Cause. For purposes of this Agreement, Cause shall mean the
occurrence of one or more of the following events:
(i) Consultant’s commission of any fraud against the
Company; (ii) Consultant engaging in any conduct in breach of
this Agreement; (iii) Consultant’s conviction
of any crime involving moral turpitude;
(iv) Consultant’s conviction of a violation of any state
or federal law that could result in a material adverse impact upon
the business of the Company, and (v) except as otherwise
expressly permitted in this Agreement, Consultant engaging in other
professional employment or consulting or directly or indirectly
participating in or assisting any business that is a current or
potential supplier, customer or competitor of the Company without
first disclosing such relationships in advance in writing to the
President of the Company. No compensation will be due to Consultant
if this Agreement is terminated for Cause other than amounts
accrued through the date of such termination.
c. Discontinuation of
Services/Availability; No Compensation Due . This Agreement
shall terminate automatically in the event Consultant elects to
discontinue services or is no longer available or able to render
services under the Agreement. Company shall have no obligation to
Consultant for payment of the monthly consulting fee or any other
form of compensation or benefit other than amounts accrued through
the date of Consultant’s election to discontinue services or
due to Consultant’s unavailability or inability to render
services under the Agreement.
6. Termination
Obligations .
a. Return of Company
Property . Upon termination of this Agreement for any
reason, Consultant agrees to return all Company Property to the
Company promptly but in no event later than two (2) business
days following termination of this Agreement. All equipment and all
tangible and intangible information relating to Company, its
employees, its customers and its vendors and business furnished to,
obtained by, or prepared by Consultant or any other person during
the course of or incident to the Term of this Agreement are and
shall remain the sole property of Company (“Company
Property”). For purposes of this Agreement, Company Property
shall include, but not be limited to, computer equipment, books,
manuals, records, reports, notes, correspondence, contracts,
customer lists, business cards, advertising, sales, financial,
personnel, operations, and manufacturing materials and information,
data processing reports, computer programs, software, customer
information and records, business records, price lists or
information and samples and in each case shall include all copies
thereof in any medium, including paper, electronic and magnetic
media and all other forms of information storage.
b. Termination of
Benefits . Unless otherwise set forth above, all benefits
to which Consultant is otherwise entitled shall cease upon
termination of this Agreement.
c. Consultant
Cooperation . Following termination of this Agreement,
Consultant shall cooperate fully with Company in all matters
including but not limited to advising the Company of all pending
work on behalf of the Company and the orderly transfer of work to
employees or representatives of Company. Upon the request of
Company, Consultant agrees to testify in any proceeding designated
by Company and agrees to cooperate in the defense of any action
brought by any third party against Company related in any way to
Consultant’s services to Company during the Term. Company
shall provide legal representation for Consultant in any such
proceeding and shall reimburse reasonable expenses actually
incurred by Consultant in connection with furnishing such
testimony.
d. Survival of
Obligations . Consultant’s obligations under this
Section 6 shall survive termination of this
Agreement.
7. Confidential
Information, Third Party Information and Inventions
.
a. Company Confidential
Information . Consultant will not use or disclose
Confidential Information or Company Property whether before, during
or after the Term, except to the extent required to perform
consulting services for Company or in accordance with instruction
or authorization of Company, without prior written consent of
Company or pursuant to process or requirements of law after
Consultant has disclosed such process or requirements to Company so
as to afford it the opportunity to seek appropriate relief
therefrom. “Confidential Information” means any
invention of any person in which Company has an interest and in
addition means all information and material that is proprietary to
Company whether or not marked as “confidential” or
“proprietary” and which is disclosed to or obtained by
Consultant that relates to Company’s past, present or future
business activities. Confidential Information includes all
information or materials prepared by, for or on behalf of Company
and includes, without limitation, all of the following: designs,
drawings, specifications, techniques, models, data, source code,
object code, documentation, diagrams, flow charts, research,
development, processes, procedures, “know-how,” new
product or new technology information, product copies, development
or marketing techniques and materials, development or marketing
timetables, strategies and development plans, including trade
names, trademarks, customer, supplier or personnel names and other
information related to customers, suppliers or personnel, pricing
policies, financial information, other information of a similar
nature whether or not reduced to writing or other tangible form and
any other trade secrets or nonpublic business information including
Company Property. Confidential Information is to be broadly defined
and includes all information that has or could have commercial
value or other utility in the business in which the Company is
engaged or contemplates engaging and all information of which the
unauthorized disclosure could be detrimental to the interests of
the Company whether or not such information is identified as
Confidential Information by the Company.
b. Third Party
Information . Consultant acknowledges during the Term of
this Agreement he may have access to patent, copyright,
confidential, trade secret or other proprietary information of
third parties subject to restrictions on the use or disclosure by
Company. During and following the Term of this Agreement,
Consultant will not use or disclose any such information other than
as consistent with the restrictions under this
Agreement.
8. Competitive
Activity . Consultant shall not be prevented from engaging
anywhere, directly or indirectly (as a principal, shareholder,
partner, director, manager, member, officer, agent, employee,
consultant or otherwise), or be financially interested in any
business including in a business involved in business activities
that are the same as, similar to, or in competition with the
business activities carried on by Company or any business that is a
current or potential supplier, customer or competitor of
Company;
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