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Consulting Agreement

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CONSULTING AGREEMENT


This CONSULTING AGREEMENT (this "Agreement") is made and entered into as of December 1, 1995, by and between AMERICAN BIOMED, INC., a Delaware corporation ("Company") and SAMUEL S. AHN, M.D. ("Consultant").


RECITALS


A. Consultant is a well-respected vascular surgeon with an established practice in the field.


B. Company is an emerging manufacturer of medical devices and desires to obtain Consultant's services, principally with respect to the clinical application of the Company's OmniCath(R) Peripheral Atherectomy Catheter and other products for vascular surgery.


NOW, THEREFORE, Company and Consultant agree as follows:


1. Services. Company hereby retains Consultant and Consultant hereby accepts the appointment as Consultant for Company upon the terms and conditions set forth in this Agreement.


2. Term of Agreement. This Agreement shall remain in effect for a period of one (1) year from December 1, 1995 to November 30, 1996, and shall thereafter be automatically renewed for consecutive periods of one (1) year unless either party notifies the other, at least ninety (90) days prior to the expiration of the then-current term, of its election not to renew the Agreement.


3. Services Provided by Consultant. Consultant is engaged to counsel and consult with Company's personnel on projects and other matters within the scope of Consultant's expertise relating to (1) the clinical application of Company's Products, (2) the selection, liaison and designation of other consultants and scientific advisors to Company, (3) the production and review of scientific reports, and (4) communications with regulatory, academic and professional bodies.


a. Availability. Consultant shall be available for the performance of services hereunder on a part-time basis, which will not exceed ten (10) hours per week. The time commitment herein shall include, but not be limited to, all travel time and all time during which Consultant is required, in the performance of services 2 hereunder, to be absent from the location of his place of residence regardless of whether services are actually being performed during the entire period of such absence.


b. Performance of Services. Consultant's services shall be performed at such reasonable times and places as the parties may mutually agree upon, including rendition of consulting services via telephone and facsimile.


4. Compensation of Consultant. Consultant shall be paid by Company the sum of one hundred fifty thousand dollars ($150,000), of which twelve thousand five hundred dollars ($12,500) shall be due and payable within thirty (30) days of the execution of this Agreement, and the balance payable in equal monthly payments through the term hereof. If there is a reduction of annual revenues received by Consultant from his medical practice of greater than sixteen and two-thirds percent (16 2/3%) below revenues received between October 1, 1994 and October 1, 1995, the monthly compensation paid to Consultant by Company shall be increased to compensate Consultant for the shortfall* up to a maximum of $50,000, above which the parties agree to negotiate additional compensation or contract and the amount as so increased will continue in effect for the remaining term of this Agreement.


5. Royalties in Connection with Consulting Activities. If the services provided by Consultant with respect to the clinical application of Company's products lead, directly or indirectly, to the development of new products or the modification or improvement of existing Company-owned products, Company shall pay Consultant the following royalties in addition to Consultant's compensation under Section 4, and Company shall fully comply with these terms for twenty (20) years or the life of any patent (whichever is longer):


a. Enhancement or Modification of Existing Products. If Consultant's services lead, directly or indirectly, to the modification or improvement of an existing Company-owned product, Company shall own such modification or improvement and Company shall compensate Consultant at a rate of five percent (5%) of all gross revenues derived from sales of that modified product. If a United States patent issues with respect to any such modified product, Company shall also issue Consultant fifty thousand (50,000) shares of Company stock. Consultant shall communicate the suggested modification or improvement to Company in writing, and Company shall reserve the right to accept such changes.


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* Up to a maximum of $50,000, above which the parties agree to negotiate additional compensation or contract.


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b. New Products Suggested by Use of Existing Products. If Consultant's services lead, directly or indirectly, to the creation of a new product which was suggested by or based upon an existing Company-owned product, Company shall own such new product and Company shall compensate Consultant at a rate of five percent (5%) of all gross revenues derived from sales of that new product should the Company accept such suggestion. If a United States patent issues with respect to any such product, Company shall also issue Consultant one hundred thousand (100,000) shares of Company stock.


c. New Products Independently Created by Consultant. If consultant creates or contributes to the creation of a new product not directly derived from any product owned by Company, Consultant shall be deemed the owner of such product. However, Company shall have the right of first refusal with regard to any such new product which is directly competitive with a then-existing product of Company, which right may be subject to a separate agreement. Without limiting the generality of the foregoing, Company specifically acknowledges that Consultant presently has five (5) patent applications pending before the United States Patent and Trademark Office, and that consultant is the sole owner of all inventions related to such patent applications. Consultant shall provide the serial number and a brief description of the product for each of the five products for which patent application is currently pending pursuant to a separate confidential agreement between the parties. Any relationship between Consultant and Company concerning any product, invention or other matter owned by Consultant is not subject to this Agreement, but may be the subject of a separate agreement.


d. Accounting. If any compensation is payable to Consultant under this Section 5, Company shall pay such compensation no less frequently than once each calendar quarter and shall simultaneously deliver to Consultant a written statement of gross revenues derived by Company, during the period
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