Exhibit
10.19


 


 


 


 


 


SERVICE
AGREEMENT


 


 


 


 


 


entered
into by and between


 


 


 


 


 


 


 


 


Medex
GmbH


—           a limited liability company under German law —


represented by its [shareholders’ meeting]


 


 


 


—           hereinafter referred to as the “Company” —


 


 


 


and


 


 


 


Dr.
Georg Landsberg


 


 





















 


On the date of execution of this Agreement
Dr. Landsberg is appointed managing director of the Company.  To the extent as provided below in
Article 9.1, this Agreement shall regulate the employment relationship
between the Company and Dr. Landsberg.


 


Article
1


Area of
Responsibility


 


 


1.               Dr. Landsberg
shall continue his work as managing director of the Company.  The distribution of tasks and
responsibilities shall result from the Schedule of Responsibilities of the
Management of the Company.  The Schedule
of Responsibilities may be amended at any time to reflect the development of
the Company, as well as its operational requirements.  Within this context, currently
Dr. Landsberg shall be responsible for Continental Operations.  He shall report to the Managing Director of
Smiths Medical International, currently Mr. Martin Jamieson.


 


2.               Dr. Landsberg
shall perform his duties and responsibilities in compliance with all statutory
provisions, in particular in compliance with the German “GmbH-Gesetz”
(Limited Liabilities Companies Act), as well as the Articles of Association of
the Company and the By-laws for the Management, as amended from time to time,
and devote all his efforts, professional know-how, and experience to the
Company.


 


Dr. Landsberg represents
the Company alone and is exempt from the restrictions imposed by
section `181 of the (German) “BGB” [Civil Code].  The Company reserves the right at any time to
appoint further managing directors and to establish a different arrangement
regarding the Company’s representation.


 


3.               Upon the
Company’s request, Dr. Landsberg shall also assume further
responsibilities in enterprises affiliated with the Company, as a managing
board member, managing director, supervisory board member, or similar executive
officer.  Dr. Landsberg further
shall join and assume responsibilities in trade associations and similar
organizations, to the extent this is considered to be in the best interest of
the Company.  Except as otherwise agreed
upon by the parties hereto, the assumption of such responsibilities shall not
establish any additional employment contract or service agreement.


 


In the event that
Dr. Landsberg receives any separate compensation for holding such
positions and offices, such compensation shall be set off against the
compensation payable under the terms of this Service Agreement.


 


Dr. Landsberg shall
resign from all of the aforementioned positions and offices whenever the
Company’s shareholders’ meeting so requests, at the latest upon his ceasing to
be employed by the Company (whether upon termination of his employment,
resignation, retirement, or upon his being released from his work for the
Company.)


 


 





















 


Article
2


Compensation


 


 


1.               Dr. Landsberg
shall receive the following compensation for his services:


 


a)              An annual
salary in the gross amount of €234,000.00 (in words: Euro two hundred
thirty-four thousand), payable in 12 equal installments, at the end of each
month;


 


b)             A one-time
bonus, payable shortly after Smiths Group plc announces its results for
the year ended 31 July 2005, of a maximum of 50% of base salary, pro-rated
for the period from the date this Agreement becomes effective, according to
Article 9.1 — until 31 July 2005, depending on performance against
agreed objectives;


 


 


c)              Effective
1 August 2005, an annual bonus agreement will be offered according to the
Smiths Medical bonus arrangements that can be amended from time to time, and in
the sole discretion of the shareholders’ meeting.  The bonus, if any, will amount to a maximum
of 50% of base salary and would be payable shortly after Smiths Group plc
announces its results for that year.  The
bonus arrangements will depend on the performance of Smiths Medical as a whole
and the successful completion of personal objectives agreed with
Dr. Landsberg.


 


2.               To induce
Smiths Group plc’s affiliates to enter into the transactions contemplated
by the Agreement and Plan of Merger dated as of 5 December 2004 (the “Merger
Agreement”), by and among the Smiths Medical Holdco Limited, Forest Acquisition
Corp., MedVest Holdings Corporation (“MedVest”), and each of the individual stockholders
of MedVest signatories to the Merger Agreement, and OEP MedVest LLC, as
representative on behalf of the stockholders of MedVest, for which you will
receive substantial benefit, you and the Company hereby agree that (a) the
benefits (the “Control Payments”) under Section (c) of the Severance and
Non-Compete Agreement dated 21 May 2003 (the “Existing Agreement”) between
Dr. Landsberg and Medex Inc., (b) the remaining payments to be made
in accordance with Section 7 of the Existing Agreement (the “Compete
Payment”), and (c) your bonus for the 2004 fiscal year (the “Bonus Payment,”
and together with the Change in Control Payment and the Compete Payment, the “Transition
Payments”) shall be paid in accordance with Section 3 below.  You hereby agree that you will not be
entitled to receive the Compete Payment or the Bonus Payment if you voluntarily
terminate your employment during the Transition Period (as defined in
Section 3 below), and you will not be entitled to receive the Change in
Control Payment if you voluntarily terminate your employment before the first
anniversary of the closing (the “Closing”) of the transactions contemplated by
the Merger Agreement.


 


3.               The “Transition
Period” shall be the period beginning on the Closing and ending on
31 December 2005.  The Company shall
pay in full the Compete Payment and the Bonus Payment, plus interest thereon at
the prime rate as published in the Eastern edition of the Wall Street Journal from
the Closing to the date of payment, on the earlier of (i) the date the
Company terminates your employment, (ii) the date you terminate your
employment for Good Reason (as defined below) or on account of your death or
disability, or (iii) 31 December 2005, so long as you remain employed
with the Company during the entire Transition Period.  “Good Reason” shall mean (A) a material
breach by the 


 


 





















 


Company
of any material obligation under this Agreement that is not curable or that is
not cured within thirty days after written notice thereof by Dr. Landsberg
to the Company, or (B) relocation of Dr. Landsberg from the present
metropolitan area of employment, without Dr. Landsberg’s consent.  The company shall pay in full the Change in
Control Payment on the earlier of (i) the date the Company terminates your
employment, (ii) the termination of your employment for Good Reason or on account
of your death or disability, or (iii) the first anniversary of the Closing
so long as you remain employed with the Company during the entire twelve month
period following the Closing.  For the
duration of your employment with the Company following the first anniversary of
the Closing, the provisions s set out in this Agreement shall apply.


 


4.               The
compensation provided for in Article 2.1 above shall be deemed full
consideration for all services performed under this Service Agreement,
including any services Dr. Landsberg may for operational reasons be
required to perform outside the Company’s regular business hours.


 


5.               The compensation
shall be reviewed annually in accordance with Smiths Medical’s policies.  This does not constitute any entitlement of
Dr. Landsberg to a pay rise.


 


6.               To the extent
that not otherwise stipulated in this Article 2, the compensation
stipulated herein shall be payable on a pro-rata basis if this Service
Agreement does not subsist for a full twelve months in any given calendar year.


 


7.               The assignment
or pledging of claims of compensation hereunder shall be subject to the prior
written approval of the shareholders’ meeting.


 


 


Article
3


Benefits
in Kind; D&O Insurance


 


 


1.               The Company
shall provide Dr. Landsberg with a company car of a class customary for
similarly situated executives for both professional and private use.  The Company shall pay all costs, including
insurance premiums, motor vehicle taxes, cost of repairs, fuel, oil, etc.,
incurred in connection with the maintenance and use of the vehicle.


 


Except from his spouse
living in a common household, nobody besides Dr. Landsberg is authorized to
drive the company car. 
Dr. Landsberg hereby waives any and all claims against the Company
which may accrue to him, his family members, or any third parties in connection
with the private use of the Company car, and agrees to indemnify the Company
from or against any and all claims brought against the Company by family
members or third parties, to the extent that such claims are not covered by the
insurance policies taken out with regard to the Company car.


 


The Company shall also
provide a mobile phone for Dr. Landsberg’s use on business.


 


2.               The Company
shall reimburse Dr. Landsberg for all reasonable expenses incurred within
the scope of his employment upon presentation of a voucher indicating the
amount and business purpose and supported by appropriate documentation, subject
however, to the Company’s guidelines, if any, as applicable from time to time
and in compliance with applicable tax laws.


 


 





















 


3.               The Company
shall provide reasonable and adequate coverage for the benefit of
Dr. Landsberg under Smiths Group’s D&O policy, provided coverage under
such D&O insurance is commercially available and can be obtained at
reasonable costs.


 


4.               Dr. Landsberg
shall be responsible for all wage taxes payable on benefits in kind provided by
the Company.


 


 


Article
4


Prevention
from Work


Continued
Payment of Compensation in the Event of Illness or Accident


 


 


1.               In the event
that he is prevented from the performance of his duties for a considerable
period of time, Dr. Landsberg shall inform the shareholders’ meeting without
undue delay, also stating the reasons for such incapacity.


 


2.               In the event of
his temporary disability due to illness, accident, or any other cause not due
to the fault of Dr. Landsberg, Dr. Landsberg shall be entitled to
continued payment of compensation in the amounts stipulated in Article 2.1
lit. a) of this Service Agreement for an uninterrupted period of three
months or until termination of this Service Agreement, whichever occurs first.


 


 


Article
5


Vacation


 


Dr. Landsberg shall be entitled to a
vacation of 30 working days per calendar year.  For the purposes of this provision, “working
day” shall mean all business days with the exception of Saturdays.  The duration and dates of such vacation shall
be coordinated with the other managing directors, if any, and agreed to by the
shareholders’ meeting.  The vacation days
that have accrued during any one vacation year shall be used by March 31
of the following year, otherwise they shall be forfeited.


 


 


Article 6


Secondary
Employment / Non-Compete / Conflicts of Interest


 


1.               Any secondary
employment, whether compensated or uncompensated, that could affect the
interests of the Company shall require the prior approval of the shareholders’
meeting.  The foregoing shall apply, mutatis mutandis, if Dr. Landsberg assumes any
responsibilities on supervisory boards, advisory boards, or similar bodies of
enterprises not affiliated with the Company. 
In case of doubt, the opinion of the shareholders’ meeting shall be
sought before taking on such secondary employment.  Before taking on any secondary employment,
prior notice shall be given to the shareholders’ meeting.


 


2.               Dr. Landsberg
undertakes to refrain from competing with the Company or any companies
affiliated with the Company for the duration of this Service Agreement.  In particular, Dr. Landsberg shall not
acquire any interests in competitors of the Company, transact business on
behalf of such competitors, be it for his own account or for the account of 


 


 





















 


third
parties, or provide any other services to such competitors.  Excepted from the foregoing shall be the
acquisition of shares in publicly traded companies, provided that such
acquisitions do not give him a considerable influence over the actions of such
Company.


 


Furthermore,
Dr. Landsberg undertakes to strictly comply with all insider trading
regulations stipulated by the law and/or by the Company, each as amended from
time to time.


 


3.               In the interest
of both parties, Dr. Landsberg shall disclose to the shareholders’ meeting
any conflict of interests arising in connection with the performance of his
duties and responsibilities.  The
foregoing provision shall apply, in particular, if customers, suppliers, or any
other business partners of the Company or affiliated with the Company are
relatives, personal friends, or close business associates of
Dr. Landsberg, or stand in a close relationship with such relatives,
personal friends, or close business associates. 
The duty of disclosure shall not be limited to cases in which a conflict
of interest may have a specific effect on the performance of Dr. Landsberg’s
duties and responsibilities; rather, the mere appearance of a conflict of
interest shall be sufficient to give rise to such a duty.


 


 


 


Article
7


Duty of
Confidentiality;


Exclusive
License to Use Work Results; Inventions


 


1.               Dr. Landsberg
shall keep all business affairs of the Company and enterprises affiliated with
the Company confidential, if such affairs are confidential in nature and/or
have not already become public knowledge. 
Dr. Landsberg further shall not grant any third parties access to
the Company’s records and files.  These
obligations shall continue even after termination of this Service Agreement.


 


2.               All work
results produced by Dr. Landsberg in the performance of his duties and
responsibilities shall be the exclusive property of the Company.  To the extent that such work results are
protected by copyright, Dr. Landsberg hereby grants the Company the
exclusive and unlimited license to use such work results in all forms
conceivable now or at a later date.  This
exclusive license shall survive termination of this Service Agreement.  Dr. Landsberg shall not be entitled to
any additional compensation for the exclusive license granted to the Company
hereunder.  The compensation stipulated
in this Service Agreement shall be deemed full and adequate consideration for
the exclusive license granted to the Company hereunder.


 


3.               The Company
shall be entitled to exclusive use of any inventions and proposed technical
improvements, as well as any patents, utility models and designs, etc.,
developed by Dr. Landsberg in the performance of his duties and
responsibilities as managing director, without additional payment.  The (German) “Arbeitnehmererfindungsgesetz”
(Act on Employees’ Inventions) shall apply, except for the provisions providing
for the inventor’s claim to compensation.


 


 





















 


Article
8


Return
of Property


 


 


Following termination of this Service
Agreement or Dr. Landsberg’s release from work, Dr. Landsberg shall,
of his own accord, return to the Company all objects due to the Company or
enterprises affiliated with the Company in his possession, including all
documents, notes, and instruments, as well as other data stored by technical
means, including any copies thereof.  The
foregoing duty shall especially include the duty to return the Company car
provided to Dr. Landsberg pursuant to Article 3.1 of this
Agreement.  The right to retain any
documents or objects defined in this section is expressly excluded.  Dr. Landsberg shall not be entitled to
any compensation or damages for returning Company property prior to termination
of this Service Agreement.  Upon
termination of his employment relationship, Dr. Landsberg shall affirm in
writing the full discharge of his duty to return property.


 


 


 


Article
9


Term of
Employment and Termination


 


 


1.               This Service
Agreement is subject to the occurrence of, and shall become effective on the
day of the Closing.


 


2.               This Service
Agreement shall be for an initial fixed term of one year from the date of the
Closing.  Thereafter, this Service
Agreement may be terminated by either contracting party by giving three months’
notice prior to the end of a calendar month. 
The right to terminate this Service Agreement for good cause
(Section 626 of the German “BGB” [Civil Code]) shall not be affected
thereby.  If the appointment as managing
director ends without simultaneous termination of the Service Agreement,
Dr. Landsberg shall be released from his duty to work according to Article 9.4
for the remaining term of the Agreement, and the Company shall continue to pay
the compensation stipulated in Article 2.1 lit. a).


 


3.               The termination
of this Service Agreement shall only be valid if made in writing.


 


4.               The Company
shall have the right, at any time, in particular if notice of termination has
been given by either of the contracting parties, to release Dr. Landsberg
from his duty to work (such release being either irrevocable or in a form that
it can be revoked), provided that the Company shall continue to pay the
contractual compensation due to Dr. Landsberg pursuant to Article 2.1
lit. a).  In the event of an irrevocable
release of Dr. Landsberg from work, the time of such release shall be
taken into account in calculating the managing director’s claim to
vacation.  For periods of release from
work during which continued payment of compensation is not set off against
unused vacation claims, any income which Dr. Landsberg receives from
another occupation or maliciously fails to acquire, shall be set off against
his compensation claim.


5.               This Service
Agreement shall end, without notice of termination being required, at the end
of the month in which Dr. Landsberg attains the age of 65, as well in case
of his becoming incapable of gainful employment according to Section 43 of
the (German) “SGB VI” (Social Code vol. 6).


 


 





















 


Article
10


Insurance
Benefits


 


 


If Dr. Landsberg requests, the Company
will — by means of contribution — make annual contributions of €1,752 (in
words:  Euro one thousand seven hundred
fifty-two) gross on behalf of Dr. Landsberg to an insurance company in
accordance with the provisions of a direct insurance (Direktversicherung).


 


 





















 


Article
11


Final
Provisions


 


 


1.               To the extent
that this Service Agreement enters into force according to Article 9.1
above, it shall supersede all former agreements regarding the employment
relationship that may hitherto have been concluded by the parties and/or any
other affiliate, and/or subsidiary of the Company, especially, but not
exclusively, the Severance and Non-Compete Agreement dated 21 May 2003,
between Medex Inc. and Dr. Landsberg.


 


2.               To the extent
that this Service Agreement enters into force according to Article 9.1
above, Dr. Landsberg hereby waives all and any possible claims arising
from all former agreements regarding the employment relationship that may
hitherto have been concluded by the parties and/or any other affiliate, and/or
subsidiary of the Company, especially, but not exclusively, arising from the
Severance and Non-Compete Agreement dated 21 May 2003, between
Medex Inc. and Dr. Landsberg.


 


3.               This Service
Agreement contains all the agreements and arrangements made between the
parties.  There are no oral side
agreements.  For the avoidance of doubt,
this Service Agreement shall be governed by German Law.


 


4.               Modifications
of and/or amendments to this Agreement shall only valid if made in
writing.  This shall also apply to the
cancellation or amendment of the requirement of the written form.


 


5.               If any
provision hereof is or becomes invalid, the validity of the other provisions
hereof shall not be affected thereby.  In
such a case, the invalid provision shall be replaced with a valid provision
which is as consistent as possible with the economic purpose of the invalid
provision intended by the parties to this Agreement.  This shall also apply if a provision is or
becomes invalid on account of the scope or extent of an obligation or a time
period.  In such case, the legally
admissible scope or extent of obligation or time period shall apply.


 


6.               Dr. Landsberg
acknowledges receipt of one original counterpart of this Agreement duly signed
by each party hereto on this day.


 


 


	
  Place and date

   

  	
   

  	
   

  	
  Place and date

  	
  Dusseldorf

  December 4, 2004

  
	
   

  	
   

  	
   

  
	
  Medex GmbH,

  	
   

  	
  /s/  Dr. Georg Landsberg

  	
   

  
	
  Represented by its
  [shareholders’ meeting]

   

   

   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
						



 


 
















 


	
  Place and date

   

  	
   

  	
   

  	
   

  	
   

  
	
   

  We agree with Article 11.1
  and accept the waiver in Article 11.2

  
	
   

  Medex Inc.

  represented by

   

   

  	
   

  	
   

  
	
  /s/ Dominick A. Arena