Consulting Agreement - TLC Laser Eye Centers Inc. and Warren Rustand
[LETTERHEAD OF TLC LASER EYE CENTERS INC.]
December 13, 2001
Mr. Warren Rustand
5750 East Santa Fe
Tuscon, Arizona 85715
Re: Offer to Retain Consulting Services
Dear Mr. Rustand:
On behalf of TLC Laser Eye Centers Inc. (the "Corporation"), I am
writing to offer to retain your consulting services and the services of J.L.
Investment, Inc. ("JL"), a Delaware corporation controlled by you, on the terms
and conditions set out below. This offer is conditional upon your acceptance of
the terms and conditions set out in this letter.
1. TERM
The term of this engagement is the six-month period from January 1,
2002, to June 30, 2002, unless the term of this Agreement is terminated earlier
as provided herein or is extended by mutual agreement of the parties hereto.
2. ENGAGEMENT BY THE CORPORATION
The Corporation engages you and JL to be responsible for overseeing
the development of the Corporation's international business development project
(the "Project"), including leading discussions with potential partners and
overseeing a senior director of the Project and making periodic reports in
respect of the Project to the chair of the Board of Directors of the
Corporation, or as the chair may direct, and such other duties as you and JL
shall reasonably be directed to perform by the Board of Directors (or the chair
thereof) of the
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Corporation. You and JL agree to accept the engagement and to render the
services described above. We acknowledge that the delineation of duties between
yourself and JL shall be within your discretion.
3. COMPENSATION
The Corporation shall pay to you a fee of US$125,000 during the Term
of this agreement, inclusive of any applicable goods and services tax, such fee
to be paid in five equal monthly instalments of US$20,833.33 and a sixth monthly
instalment of US$20,833.35, payable in arrears on the 15th day of each such
month. The first US$60,000 of such compensation shall be paid to you, with the
balance of the compensation being paid to JL. You and JL shall be responsible
for remitting and withholding all required taxes and premiums as may be
applicable. You and JL jointly and severally agree to indemnify and hold the
Corporation harmless from all costs, charges and expenses including, without
limitation, all fines and penalties that may be assessed in connection with the
failure by either you or JL to remit or withhold such taxes and premiums.
4. EXPENSES
Upon presentation of expense statements or receipts or such other
supporting documentation as the Corporation may reasonably require, you and JL
shall be reimbursed for all reasonable expenses incurred in the performance of
your respective services under this agreement, all in accordance with the
Corporation's usual and customary policies.
5. REPRESENTATION AND WARRANTY
In consideration of the Corporation entering into this agreement,
you and JL jointly and severally represent and warrant to the Corporation that
the payment of compensation hereunder does not exceed five percent of JL's
consolidated gross revenues in the current year or in any of the past three
years. You and JL acknowledge and agree that the Corporation and its Board of
Directors are relying on this representation and warranty for purposes of
determining your independent director status under Ontario securities laws, the
Toronto Stock Exchange rules and the NASDAQ rules.
6. NO USE OF CONFIDENTIAL INFORMATION
During the Term of this agreement and in perpetuity thereafter, you
and JP shall hold in confidence and keep confidential all Confidential
Information and shall not use for the benefit of yourselves or others (except in
the course of providing services hereunder) any Confidential Information and
shall not disclose any Confidential Information to any person except with the
Corporation's prior consent. The foregoing prohibition shall not apply to any
Confidential Information if the Confidential Information is available to the
public domain at the time of such disclosure or use, without breach of this
agreement.
Confidential Information means all confidential or proprietary
information, intellectual property (including trade secrets) and confidential
facts relating to the business and
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affairs of the Corporation of which you are privy as a result of the services
rendered pursuant to this agreement.
7. NO CONFLICTS OF INTEREST
Other than as currently engaged in by you and of which the
Corporation is aware, neither you nor JL shall engage in any business or other
transaction or have any financial or other personal interest which is
incompatible with the performance of your respective duties under this
agreement.
8. NO SOLICITATION OF CLIENTS
Neither you nor JL shall, either during the Term or for a period of
one year thereafter, directly or indirectly, contact or solicit any designated
clients of the Corporation for the purpose of selling to the designated clients
any services which are the same as or substantially similar to, or in any way
competitive with, the services sold by the Corporation, or undertaking any
business therewith that could reasonably be considered part of the Project. For
the purpose of this paragraph, a designated client means a person who was a
client of the Corporation or with whom either you or JL had contact as a result
of the services provided pursuant to this agreement while retained by the
Corporation pursuant to this agreement.
9. REMEDIES
You and JL acknowledge and agree that any breach or threatened
breach of the provisions of paragraphs 6 to 8 inclusive will result in the
Corporation suffering irreparable harm which cannot be fully or adequately
compensated by recovery of damages alone. Accordingly, you and JL agree that the
Corporation shall be entitled to interim and permanent injunctive relieve,
specific performance and other equitable remedies, in addition to any other
relief to which the Corporation may become entitled.
10. NATURE OF RELATIONSHIP
Your and JL's relationship to the Corporation is that of independent
contractor. Neither you nor JL is an employee, agent, partner or joint venturer
of the Corporation. Nothing herein shall be construed so as to make either you
or JL and the corporation partners or joint venturers, or to make either you or
JL an employee or agent of the Corporation.
11. NO AUTHORITY TO BIND THE CORPORATION
Except in your capacity as a member of the Board of Directors of the
Corporation, neither you nor JL shall have authority to act, or to hold
yourselves out, as agents of the Corporation or to bind the Corporation to
perform any obligations to any third party.
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12. RENEWAL
This agreement may be renewed on such terms as you and the
Corporation may agree in writing from time to time.
13. NOTICE
Any notice to be given hereunder shall be in writing and shall be
given to you personally or by prepaid registered mail. In the case of notice to
be delivered to the Corporation, it shall be addressed to the Corporation at the
office set out on the first page of this letter, attention General Counsel. In
the case of notice to you or JL, it shall be addressed to you at the address to
which this letter is addressed. Any notice given by mail shall be deemed to have
been given on the fourth business day next following the date of mailing.
14. ENTIRE AGREEMENT AND GOVERNING LAW
This agreement shall be governed by the laws of Ontario, is the
entire agreement between us and may only be modified by an agreement in writing
signed by both parties.
Would you please confirm this agreement by signing and returning to
us the enclosed copy of this letter.
Yours truly,
TLC LASER EYE CENTERS INC.
by: /s/ Elias Vamvakas
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Name: Elias Vamvakas
Title: Chairman and CEO
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I hereby confirm the foregoing this 31st day of December, 2001.
/s/ Warren Rustand
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Warren Rustand
I hereby confirm the foregoing this 31st day of December, 2001.
JL INVESTMENT, Inc.
by: /s/ Donald A. Semro
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Name: Donald A. Semro
Title: Treasurer