Document:

Exhibit
10.3

 

CONSULTING AGREEMENT

 

	
  PARTIES

  	
   

  	
  TRANSOMA MEDICAL, INC.

  	
   

  	
  [the “COMPANY”]

  
	
   

  	
   

  	
  4211 Lexington Avenue North, Suite 2244

  	
   

  	
   

  
	
   

  	
   

  	
  St. Paul, MN 55126-6164

  	
   

  	
   

  
	
   

  	
   

  	
  Phone: 651-481-7410

  	
   

  	
   

  
	
   

  	
   

  	
  Fax: 651-481-7417

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Dick Nigon

  	
   

  	
  [the “CONSULTANT”]

  
	
   

  	
   

  	
  Company:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Street 

  	
  Address:60 South 6th Street

  	
   

  	
   

  
	
   

  	
   

  	
  City, State Zip:

  	
  Minneapolis, MN 55402

  	
   

  	
   

  
	
   

  	
   

  	
  Phone:

  	
  (612) 455-5585

  	
   

  	
   

  
	
   

  	
   

  	
  Fax:

  	
  (612) 455-5719

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  DATE

  	
   

  	
  June 20, 2006

  	
   

  	
   

  

 

RECITALS

 

A.           The
parties wish to provide for the engagement of CONSULTANT by the COMPANY.

 

B.                                    CONSULTANT wishes to receive compensation from the
COMPANY for CONSULTANT’s services, and the COMPANY desires reasonable
protection of its confidential business and technical information, which has
been acquired and is being developed by the COMPANY at substantial expense.

 

AGREEMENT

 

The COMPANY and CONSULTANT, each intending to be legally bound, agree as
follows:

 

1.                                      ENGAGEMENT. Subject to all of the terms and conditions of this Agreement, the COMPANY
agrees to engage CONSULTANT as requested from time to time by an authorized
officer of the COMPANY during the term of this Agreement and CONSULTANT agrees
to consider acceptance of such engagement.

 

CONSULTANT’S relationship with
COMPANY is that of an independent contractor, and nothing in this Agreement is
intended to, or should be construed to, create a partnership, agency, joint
venture or employment relationship. CONSULTANT will not be entitled to any of
the benefits which COMPANY may make available to its employees, including, but
not limited to, group health or life
insurance, profit-sharing or retirement benefits. CONSULTANT is not authorized
to make any representation, contract or commitment on behalf of COMPANY unless
specifically requested or authorized in writing to do so by a COMPANY official. CONSULTANT is solely responsible for, and will
file, on a timely basis, all tax returns and payments required to be filed
with, or made to, any federal, stale or local tax authority with respect to the
performance of services and receipt of fees under this Agreement. CONSULTANT is
solely responsible for, and must maintain adequate records of, expenses
incurred in the course of performing services under this Agreement. No part of
CONSULTANT’S 

 

 

compensation will be subject to
withholding by COMPANY for the payment of any
social security, federal, state or any other employee payroll taxes. COMPANY
will regularly report amounts paid to CONSULTANT by filing Form 1099-MISC with
the Internal Revenue Service as required by law.

 

2.                                      DUTIES. CONSULTANT shall perform tasks as are set forth in the Statement of Work
attached hereto as Exhibit A (“Duties). CONSULTANT
will diligently and conscientiously perform his duties to the best of his
ability. Services will be performed under the direction of BRIAN BROCKWAY, the COMPANY’s President and CEO, or his duly
authorized representative.

 

3.                                      TIME COMMITMENT. CONSULTANT shall devote such time to perform his Duties as the parties may mutually agree.

 

4.                                      EFFECTIVE DATE. This Agreement shall become effective on the date set forth above.

 

5.                                      TERMINATION; SURVIVAL. Either party may
terminate this Agreement for any reason upon thirty (30) calendar days’ written
notice to the other party. The definitions contained in this Agreement and the
rights and obligations contained in under Sections 7, 8, 9, 12, 14 and 15 below
will survive any termination or expiration of this Agreement.

 

6.                                      COMPENSATION. In consideration for CONSULTANT’S services under this Agreement, the
COMPANY agrees to pay CONSULTANT a fee as set forth in the Statement of Work
for CONSULTANT’S activities as may be requested from time to time by the
COMPANY.

 

7.             INVENTIONS:
COMPANY INVENTIONS.

 

(a)                                 “Inventions” include processes, machines,
compositions of matter, improvements, inventions (whether or not protectable
under patent laws), works of authorship, information fixed in any tangible
medium of expression (whether or not protectable under copyright laws), moral
rights, mask works, trademarks, trade names, trade dress, trade secrets,
know-how, ideas (whether or not protectable under trade secret laws), and all
other subject matter protectable under patent, copyright, moral right, mask
work, trademark, trade secret or other laws, and includes without limitation
all new or useful art, combinations, discoveries, formulae, manufacturing
techniques, technical developments, discoveries, artwork, software, and
designs.

 

(b)                                “Company Inventions” are Inventions that
CONSULTANT, solely or jointly with others, conceives, reduces to practice,
creates, derives, develops or makes within the scope of CONSULTANT’S work for
COMPANY under this Agreement.

 

(c)                                 CONSULTANT agrees that all Company Inventions made
by CONSULTANT during or within eighteen (18) months after the term of this
Agreement will be the COMPANY’S sole and exclusive property. CONSULTANT will,
with respect to any Company Invention:

 

 

(i)                                    keep current, accurate and complete records, which
will belong to the COMPANY and, upon the COMPANY’S request, be kept and stored
on the COMPANY’S premises;

 

(ii)                                 promptly and fully disclose the existence and
describe the nature of the Company Invention to the COMPANY in writing (and
without request);

 

(iii)                              assign and does hereby assign to COMPANY or
COMPANY’S designee CONSULTANT’S entire worldwide right, title and interest in and
to all Company Inventions and all
associated records and intellectual property rights and the complete right to
exploit or otherwise use the Company Inventions or any portion thereof, in any
form of medium, expression or technology now known or hereafter known or
developed, all contract and licensing rights, and all claims and causes of
action with respect to any of the foregoing, whether now known or hereafter to become known during the entire term
of such rights and any extension thereto;

 

(iv)                             acknowledge and deliver promptly to the COMPANY any written instruments, and perform any other acts
necessary in the COMPANY’S opinion to obtain, perfect and enforce, for COMPANY’S
benefit, COMPANY’S rights, title and interest in any and all countries, in and
to all patents, copyrights, moral rights, mask works, trade secrets, and other
property rights in each of the Company Inventions.

 

If CONSULTANT has any rights to
the Company Inventions that cannot be assigned as described above, CONSULTANT
agrees to waive enforcement world-wide of such rights against COMPANY, its
officers, directors, shareholders, agents and employee. If CONSULTANT has any
rights to the Company Inventions that cannot be assigned nor waived as
described above, CONSULTANT hereby grants and agrees to grant to
COMPANY an exclusive, irrevocable, paid-up, and royalty free license, in
perpetuity and world-wide, to fully exercise such rights, including rights to
sublicense through multiple tiers of sublicenses. These rights are assignable
by COMPANY. CONSULTANT also waives and agrees never to assert any moral rights,
or the equivalent thereof, against COMPANY with respect to any of the rights
described above.

 

(d)                                CONSULTANT represents that, except as previously
disclosed to the COMPANY in writing, as of the date of this Agreement,
CONSULTANT has no rights under, and will make no claims against the COMPANY
with respect to, any inventions
which would be Company Inventions if made, conceived or acquired by CONSULTANT
during the term of this Agreement.

 

(e)                                 With respect to any
obligations performed by CONSULTANT under subsection 7(b) following termination
of this Agreement, the COMPANY will pay CONSULTANT an hourly fee as set forth
in the last Statement of Work, and will pay or reimburse all reasonable out-of-pocket
expenses.

 

 

8.                                      PUBLICATIONS. The COMPANY shall have
the right to publish the results of CONSULTANT’S work under this Agreement at
any time the COMPANY determines to be appropriate and desirable. CONSULTANT
grants and agrees to grant to the COMPANY the perpetual, irrevocable,
nonexclusive, worldwide, royalty-free right to copy,
republish, reproduce, prepare derivative works, perform, display, distribute
and use, in whole or in part, any material published by CONSULTANT, whether
copyrighted or not, based on any information, conclusions or developments
resulting from work under this Agreement. Any works of original authorship,
including computer programs produced by CONSULTANT in the performance of the
work called for by this
Agreement shall be considered as “work made for hire” as that term is used in
the Copyright Act.

 

9.             CONFIDENTIAL INFORMATION

 

(a)                                 “Confidential Information,” as used in this Section 9, means information
that is not generally known and that is proprietary to the COMPANY or that the
COMPANY is obligated to treat as proprietary. Specifically, Confidential
Information shall include but not be limited to the COMPANY’S customer or prospect lists,
marketing and selling tactics or strategies planned or employed by the COMPANY,
sales figures, market projections, product designs, materials used in products
and manufacturing processing. CONSULTANT’S duties shall apply only to
Confidential Information that is: (i) disclosed by the COMPANY in writing and is marked to indicate it is
confidential at the time of disclosure; or that is (ii) disclosed by the COMPANY
in any other manner including oral disclosure and is indicated to be
confidential at the time of disclosure; or that is (iii) disclosed in the
form of tangible products or materials transmitted to the CONSULTANT with an
accompanying written memorandum.

 

(b)                                Except as specifically authorized by an authorized
officer of the COMPANY or by written COMPANY policies, CONSULTANT will not use
or disclose Confidential
Information to any person who is not an employee of the COMPANY. Upon
termination of this Agreement, CONSULTANT will promptly deliver to the COMPANY
all records and any compositions, articles, devices, apparatus and other items
that disclose, describe or embody Confidential Information or any Invention,
including all copies, reproductions and specimens of the Confidential
Information in CONSULTANT’S possession, regardless
of who prepared them, and will promptly deliver any other property of the
COMPANY in CONSULTANT’S possession, whether or not Confidential Information.

 

(c)                                 This Agreement imposes
no obligation upon CONSULTANT with respect to Confidential Information that:
(i) was in the CONSULTANT’S possession before receipt from the COMPANY; (ii) is
or becomes available to the public through no fault of the CONSULTANT; (iii) is
received in good faith by the CONSULTANT from a third party who had the right
to provide it and is not subject to an obligation of confidentiality owed to
the third party; or (iv) is independently 

 

 

developed
by the CONSULTANT without reference to Confidential Information received
hereunder.

 

(d)                                CONSULTANT’S duties with respect to Confidential
Information under this Section 9 shall
continue for
so long as the information does not become publicly available to persons
outside of the COMPANY.

 

(e)                                 CONSULTANT shall protect Confidential Information
by using the same degree of care, but no less than a reasonable degree of care,
to prevent the unauthorized disclosure of Confidential Information, as the
CONSULTANT uses to protect his own confidential information of a like nature.

 

(f)                                   In the event that
CONSULTANT is required by judicial or administrative process to disclose
Confidential Information, CONSULTANT shall promptly notify
the COMPANY and allow the COMPANY a reasonable time to oppose such process. If
required under force of law, CONSULTANT must use best efforts to maintain the
confidentiality of the Confidential Information by providing such Confidential
Information under seal, protective order or under equivalent procedure.

 

10.           NON·COMPETE

 

(a)                                 “Conflicting Product,” as
used in this Section 10, means
any product, method or process, system or service of any person or organization
other than the COMPANY, in existence or under development, which is the same as
or similar to or competes with or has a usage allied to, a product, method or
process, system or service upon which CONSULTANT works (in either a sales or
nonsales capacity) during the last three years of his employment by the
COMPANY, or about which CONSULTANT acquires Confidential Information.

 

(b)                                “Conflicting Organization” means any person or
organization which is engaged in or about to become engaged in, the
development, production, marketing, leasing, selling or servicing of a
Conflicting Product.

 

(c)                                 CONSULTANT agrees that
during the term of this Agreement and for a period of eighteen (18) months
after the termination of this Agreement,
CONSULTANT will not render services, directly or indirectly, in the United
States, or in any other country, to any Conflicting Organization.

 

(d)                                CONSULTANT will not, directly or indirectly, as an agent, consultant, or in any other capacity, participate in any way whatsoever in
inducing or attempting to induce any employee of COMPANY to
terminate employment with COMPANY.

 

11.                                EXPENSES. The COMPANY will
reimburse CONSULTANT for all usual, reasonable and necessary expenses paid or
incurred by CONSULTANT in the performance of CONSULTANT’S duties, provided that (i) the COMPANY shall have given its prior approval for
such expenses, (ii) such expenses shall be incurred in accordance with all
applicable COMPANY policies and (iii) CONSULTANT shall have submitted all
receipts and other documentation required by such policies.

 

 

12.                                OWNERSHIP AND RETURN OF COMPANY PROPERTY. All materials
(including, without limitation, documents, drawings, models, apparatus,
sketches, designs, lists, and all other tangible media of expression) furnished
to CONSULTANT by COMPANY, whether
delivered to CONSULTANT by COMPANY or made by CONSULTANT in the performance of
services under this Agreement (collectively, the “Company Property”) are the
sole and exclusive property of COMPANY or COMPANY’S suppliers or customers and
CONSULTANT hereby does and will assign to COMPANY all rights, title and
interest CONSULTANT may have or acquire in the Company Property. CONSULTANT
agrees to keep all Company Property at the COMPANY’S or CONSULTANT’S premises
unless otherwise permitted in writing by COMPANY. At COMPANY’S request and no later than five (5)
days after such request, CONSULTANT shall destroy or deliver to COMPANY, at
COMPANY’S option, (a) all Company Property, (b) all tangible media of
expression in CONSUTANT’S possession or control which incorporate or in which
are fixed any Confidential Information, and (c) written certification of CONSULTANT’S compliance
with CONSULTANT’S obligations under this sentence.

 

13.                                OBSERVANCE OF COMPANY RULES. At all times while on COMPANY’S premises,
CONSULTANT will observe COMPANY’S rules and regulations with respect to conduct,
health and safety and protection of persons and property.

 

14.                                NO ADEOUATE REMEDY. CONSULTANT understands that if CONSULTANT fails
to fulfill CONSULTANT’S obligations under this Agreement, the damages to the
COMPANY might be difficult to determine. Therefore,
in addition to any other rights or remedies available to the COMPANY at law, in equity, or by statute, CONSULTANT hereby
consents to the specific enforcement of this Agreement by the
COMPANY through an injunction or restraining order issued by an appropriate
court.

 

15.                                MISCELLANEOUS.

 

(a)                                 No Conf1ict. CONSULTANT represents
and warrants to the COMPANY that neither entering into or this Agreement nor the
performance of any of CONSULTANT’S obligations hereunder will conflict with or
constitute a breach under any obligation or CONSULTANT under any agreement or contract to which CONSULTANT is a party or any
other obligation by which CONSULTANT is bound. Without limiting the foregoing,
CONSULTANT agrees that at no time will CONSULTANT utilize any trade secrets or other
intellectual property of any third
party while performing services hereunder.

 

(b)                                Successors and Assigns. This Agreement is
binding on and inures to the benefit of
the COMPANY’S successors and assigns; provided, however, that the COMPANY may
assign this Agreement only in connection with a merger, consolidation,
assignment, sale or other disposition of substantially all of its assets or business. This Agreement is also binding on CONSULTANT’S heirs,
successors, assigns and legal
representatives.

 

 

(c)                                 Modification. This Agreement may be
modified or amended only by a writing signed by both the COMPANY and CONSULTANT.

 

(d)                                Governing Law. The laws of Minnesota will govern the
validity, construction and performance of this Agreement. Any legal proceeding related to this
Agreement will be brought in an appropriate Minnesota court, and both the COMPANY and CONSULTANT hereby consent to the exclusive
jurisdiction of that court for this purpose.

 

(e)                                 Construction. Wherever possible, each
provision of
this
Agreement will be interpreted so that it is valid under the applicable law. If any provision of this Agreement will be
interpreted so that it is valid by a court of competent jurisdiction under the applicable law,
that provision will remain effective to the extent not declared invalid. The remainder of this Agreement also will
continue to be valid, and the
entire Agreement
will continue to be valid in other jurisdictions.

 

(f)                                   Waivers. No failure or delay by
either the COMPANY or CONSULTANT in exercising any right or remedy under this Agreement will waive any provision
of the Agreement. No single or partial exercise by either the COMPANY or
CONSULTANT of any right or remedy under this Agreement will preclude either of
them from otherwise or further exercising these rights or remedies, or any other rights or remedies
granted by any law or any related document.

 

(g)                                Captions. The headings in this
Agreement are for convenience only and do not affect this Agreement’s interpretation.

 

(h)                                Entire Agreement. This Agreement
supersedes all previous and contemporaneous oral negotiations, commitments, writing and understanding between the parties concerning the
matters in this Agreement, including without limitation, any policy or
personnel manuals of the COMPANY.

 

(i)                                    Notices. All notices and other
communications required or permitted under this Agreement shall be in writing and either sent by certified First-Class mail,
postage prepaid, or delivered in person, and shall be effective five (5) working days after mailing or on the next business work day if delivered in person, to the addresses stated at
the beginning of this Agreement. These addresses may be changed at any time by like notice or delivery in person.

 

 

IN WITNESS WHEREOF, the COMPANY and CONSULTANT have
executed this Agreement as of the date first above shown.

 

	
  FOR: TRANSOMA MEDICAL, INC.

  	
   

  	
  FOR: CONSULTANT

  
	
   

  	
   

  	
   

  	
   

  
	
  By   /s/
  Brian P. Brockway          

  	
   

  	
   

  	
  By   /s/ Dick Nigon                         

  	
   

  
	
   

  	
   

  	
   

  
	
  Its: President & CEO

  	
   

  	
  Its:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Brian P. Brockway

  	
   

  	
   

  	
  Dick Nigon

  	
   

  
	
  (Printed Name)

  	
   

  	
  (Printed Name)

  
										

 

 

CONSULTING AGREEMENT

TRANSOMA MEDICAL, INC.

 

EXHIBIT A

 

STATEMENT OF WORK

(“Duties”)

 

CONSULTANT’S work under this Agreement shall include the following:

 

Describe activities (what, where, when).

 

Transoma Medical Board of Directors seat.

 

Start Date: 06-14-06

 

End Date:

 

For the above-described activities, CONSULTANT’S fee is listed below:

 

 

	
  Options

  	
   

  	
  75,000 shares at
  FMV. 25,000 shares are subject to 1 year cliff vesting and the balance vests
  quarterly over the next 24 months in equal increments.

  
	
  Cash
  compensation per attended full board meeting

  	
   

  	
  $2,500

  
	
  Cash
  compensation per audit committee meeting attended, serving as chair, whether
  by phone or face-to-face

  	
   

  	
  $500

  
	
  Cash
  compensation for participation in any other committee meeting attended,
  whether by phone or face-to-face

  	
   

  	
  $500

  
	
  Retainer

  	
   

  	
  noneExhibit 10.4

 

TRANSOMA MEDICAL, INC.

CONFIDENTIALITY AND NONCOMPETITION AGREEMENT

 

THIS
AGREEMENT  (“Agreement”)
is entered into as of             , 20   , by and
between Transoma Medical, Inc., a Delaware corporation (hereinafter referred to
as “Transoma Medical”), and                    ,
individual resident of the state of             
(“Employee”).

 

RECITALS

 

A.                                   Transoma
Medical is engaged in the business of (a) providing wireless implantable
monitors and data collection products for monitoring the vital signs of
untethered, conscious, freely moving laboratory animals, and (b) developing and
commercializing monitoring devices for human use (the “Business”). The success
of the Business depends to a significant extent upon maintaining the secrecy of
Transoma Medical’s Confidential Information (as defined below).

 

B.                                     Transoma Medical developed its Confidential
Information at great expense, time, and effort. Disclosure of any such Confidential Information to a
competitor would cause irreparable harm to Transoma Medical.

 

C.                                     Transoma Medical and Employee entered into
that certain                        
Agreement, dated as                                
(“Original Agreement”), which contained reasonable, post-employment,
competitive restrictions for which Employee acknowledges that Employee received
good and valuable consideration.

 

D.                                    Transoma Medical is entering into a Stock
Purchase Agreement, dated January 22, 2002, pursuant to which the Investors
listed on Schedule 1 thereto are purchasing Transoma Medical’s Series A
Preferred Shares, and as a condition to that agreement, Employee has agreed to
sign this Agreement. This Agreement supersedes and replaces any and all prior
understandings with respect to its subject matter, including those
understandings contained in the Original Agreement.

 

E.                                      Transoma Medical will not allow Employee to
have access to or control over any of Transoma Medical’s Confidential
Information, in any capacity, unless Employee has previously signed this
Agreement.

 

F.                                      Both Transoma Medical and Employee understand
and agree that Employee’s employment with Transoma Medical is “at will” and
that by entering into this Agreement, neither party intends to create an
Agreement that determines or affects the duration of Employee’s employment with
Transoma Medical.

 

G.                                     In consideration of the reasonable,
post-employment, competitive restrictions set forth in this Agreement, which
are beyond those to which Employee agreed in the Original Agreement, Transoma
Medical has offered Employee good and valuable consideration contingent upon
Employee signing this Agreement and subject to the terms and conditions
contained herein.

 

 

NOW, THEREFORE,
in consideration of the premises, the respective undertakings of Transoma
Medical and Employee set forth below, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Transoma Medical and Employee agree as follows:

 

SECTION
1.  DEFINITIONS

 

In this Agreement, the following definitions apply.

 

1.1                                 “Confidential
Information” means information, not generally known or ascertainable to persons
outside of Transoma Medical by proper means, and that is proprietary to
Transoma Medical. Confidential Information includes trade secret information
about Transoma Medical’s methods or processes and products, including
information relating to research, development, manufacture, purchasing,
accounting, engineering, marketing, merchandising, selling, leasing, servicing,
finance and business systems and techniques. Confidential Information includes
“Inventions” as defined herein. It also means, to the extent not previously
stated, all information disclosed to Employee, or to which Employee obtains
access, whether originated by Employee or others, during the period of
Employee’s employment, which Employee has a reasonable basis to believe to be
Confidential Information, or which is treated by Transoma Medical as being
Confidential Information. If Transoma Medical’s competitors acquire any of such
Confidential Information, it would be valuable to them and harm Transoma
Medical.

 

1.2                                 “Third
Party Information” means information that Transoma Medical has received or will
receive in the future from third parties that is considered Confidential or
proprietary information of that third party, and is subject to a duty on
Transoma Medical’s part to maintain the Confidentiality of such information and
to use it only for certain limited purposes.

 

1.3                                 “Competing
Product” means any product, method or process, system or service of any person
or organization other than Transoma Medical, in existence or under development,
which is the same as or similar to or competes with, or has a usage allied to,
a product, method or process, system or service upon which Employee will work
(in either a sales or nonsales capacity) or has worked at anytime during the
last two (2) years of Employee’s employment by Transoma Medical, or about which
Employee acquires Confidential Information.

 

1.4                                 “Competing
Organization” means any person or organization which is engaged in or about to
become engaged in, research on or development, production, marketing, leasing,
selling or servicing of a Competing Product.

 

1.5                                 “Invention”
or “Inventions” means discoveries, improvements, ideas, processes, formulas,
methods, source and object codes, mask works, data, programs, algorithms and
other mathematical formulae, know-how, developments, designs, devices and
techniques (whether or not shown or described in writing or reduced to
practice) and works of authorship, whether or not patentable or registrable
under copyright or similar statutes, (1) which relate directly to the Business
of Transoma Medical (defined below), or (2) 

 

 

which relate to
Transoma Medical’s actual or demonstrably anticipated research or development,
or (3) which result from
any work performed by Employee for Transoma Medical, or (4) for which
equipment, supplies, facilities or Confidential Information of Transoma Medical
is used, or (5) which is developed on any Transoma Medical time.

 

SECTION
2.  INVENTIONS

 

2.1                                 Disclosures
Regarding Inventions. With respect to Inventions made, authored or
conceived by Employee, either solely or jointly with others, during Employee’s
employment, whether during normal working hours or whether at Transoma
Medical’s premises; or within eighteen (18) months after termination of
Employee’s employment, Employee will:

 

a)                                      Keep
accurate, complete, and timely records of such Inventions (in the form of
notes, sketches, drawings and in any other form that may be required by
Transoma Medical), which records will be Transoma Medical’s property.

 

b)                                     Promptly
and fully disclose and describe such Inventions in writing to Transoma Medical.

 

c)                                      Assign
(and Employee does hereby assign) to Transoma Medical (or its designee as
directed by Transoma Medical) all of Employee’s rights, title, and interest of
every kind and nature whatsoever to such Inventions, and to applications for
letters patent and/or copyright in all countries and to letters patent and/or
copyrights granted upon such Inventions in all countries. Employee acknowledges
that all copyrightable material Employee produces is work made for hire.

 

d)                                     Deliver
promptly to Transoma Medical (without charge to Transoma Medical) such written
instruments and to do such others acts as may be necessary in the opinion of
Transoma Medical to preserve property rights against forfeiture, abandonment or
loss.

 

e)                                      To
avoid any possible uncertainty, Employee has listed on Exhibit A
attached hereto all Inventions that Employee has, alone or jointly with others,
conceived, developed, or reduced to practice or caused to be conceived,
developed, or reduced to practice prior to the commencement of Employee’s
employment with Transoma Medical that Employee considers to be Employee’s
property or the property of third parties and that Employee wishes to have
excluded from the scope of this Agreement (collectively, “Prior Inventions”).
If no such disclosure is attached, Employee represents that there are no Prior
Inventions. Except as listed in this Exhibit A, Employee will not assert
any rights under any Inventions as having been made, conceived, authored or
acquired by Employee prior to being employed by Transoma Medical.

 

f)                                        If,
in the course of Employee’s employment with Transoma Medical, Employee
incorporates a Prior Invention into a Transoma Medical product, process,
machine, or Transoma Medical Invention (defined above), Transoma Medical is 

 

 

hereby granted and
shall have a nonexclusive, royalty-free, irrevocable, perpetual, worldwide
license (with rights to sublicense through multiple tiers of sublicensees) to
make, have made, modify, use, and sell such Prior Invention. Notwithstanding
the foregoing, Employee agrees that Employee will not incorporate or permit to
be incorporated Prior Inventions into any Transoma Medical product, process,
machine, or Transoma Medical Invention without Transoma Medical’s prior written
consent.

 

NOTICE: Any
provision in this Agreement requiring Employee to assign Employee’s rights in
any Invention does not apply to ·an invention which qualifies for exclusion
under the provisions of Minnesota Statute Section 181.78. That section provides
that the requirement to assign “does not apply to an invention for which no
equipment, supplies, facility or trade secret information of the employer was used
and which was developed entirely on the employee’s own time, and (1) which does
not relate (a) directly to the business of the employer or (b) to the
employer’s actual or demonstrably anticipated research or development, or (2)
which does not result from any work performed by the employee for the
employer.”  Employee understands that
Employee bears the burden of proving that an Invention qualifies for exclusion
under Minnesota Statute Section 181.78.

 

2.2                                 Obtaining
Letters Patent, Copyright Registrations & Other Protections.

 

a)                                      Employee
shall assist Transoma Medical in every proper way to obtain and enforce United
States and foreign proprietary rights relating to any and all inventions,
original works of authorship, developments, improvements or trade secrets of
Transoma Medical in any and all countries. Employee will execute, verify and
deliver such documents and perform such other acts (including appearing as a
witness) Transoma Medical may reasonably request for use in applying for,
obtaining, perfecting, evidencing, sustaining and enforcing such proprietary
rights and the assignment thereof Employee shall execute, verify and deliver
assignments of such proprietary rights to Transoma Medical or its designee.
Employee shall assist Transoma Medical with respect to proprietary rights in
any and all countries beyond the termination of Employee’s employment, subject
to Employee’s compensation by Transoma Medical at a reasonable rate after
termination for the time actually spent by Employee at Transoma Medical’s
request on such assistance.

 

b)                                     If
Transoma Medical is unable for any reason, after reasonable effort, to secure
Employee’s signature on any document needed in connection with the actions
specified in the preceding paragraph, Employee hereby irrevocably designates
and appoints Transoma Medical and its duly authorized officers and agents as
Employee’s agent and attorney-in-fact, to act for and on behalf of Employee to
execute, verify and file any such documents and to do all other lawfully
permitted acts to further the purposes of the preceding paragraph with the same
legal force and effect as if executed by Employee. Employee hereby waives and
quitclaims to Transoma Medical any and all claims of any nature whatsoever
which 

 

 

Employee now or
may hereafter have for infringement of any proprietary rights assigned to
Transoma Medical in accordance with this Agreement.

 

2.3                                 Future
Inventions. As to any future Inventions made by Employee, which relate to
the Business, products or practices of Transoma Medical and which are first
conceived or reduced to practice during the term of this Agreement, or within
six (6) months thereafter, but which are claimed for any reason to belong to an
entity or person other than Transoma Medical, Employee will promptly disclose
the same in writing to Transoma Medical and shall not disclose the same to
others if Transoma Medical, within twenty (20) days thereafter, shall claim
ownership of such Inventions under the terms of this Agreement. If Transoma
Medical makes no such claim, Employee hereby acknowledges that Transoma Medical
has made no promise to receive and hold in confidence any such information
disclosed by Employee.

 

SECTION
3.         CONFIDENTIAL INFORMATION

 

3.1                                 Protection
of Confidential and Third Party Information. Except as required in
Employee’s duties to Transoma Medical, Employee will never, either during
Employee’s employment by Transoma Medical or thereafter, use or disclose any
Confidential Information or Third Party Information as defined hereinabove
absent prior written approval from Transoma Medical for his or her own benefit
or any benefit to a Third Party. The foregoing obligation of Confidentiality
shall not apply to any knowledge or information that is now published or which
subsequently becomes generally publicly known in the form in which it was
obtained from Transoma Medical other than as a direct or indirect result of the
breach of this Agreement by the Employee.

 

3.2                                 Return
of Confidential Information. Upon termination of Employee’s employment with
Transoma Medical, all records and any compositions, articles, devices,
equipment and other items which disclose or embody Confidential Information,
including all copies or specimens thereof in Employee’s possession, whether
prepared or made by Employee or others, will be left with Transoma Medical.

 

SECTION
4.         NOTIFICATION OF NEW EMPLOYER

 

4.1                                 Notification
of New Employer. In the event that Employee leaves the employ of Transoma
Medical, Employee hereby consents to the notification of Employee’s new
employer of Employee’s rights and obligations under this Agreement.

 

SECTION
5.         NONCOMPETITION & NONSOLICITATION

 

Transoma Medical and Employee agree that, solely due
to Employee’s position with Transoma Medical, Employee will have access to
certain Confidential Information of Transoma Medical. Employee acknowledges
that Transoma Medical will only release this Confidential Information upon the
receipt of assurances that Employee will not use the information to Transoma
Medical’s disadvantage and, accordingly, agrees to the following provisions:

 

5.1                                 Agreement
Not to Compete. During the term of Employee’s employment by Transoma
Medical or any affiliate of Transoma Medical (the period to include Employee’s
initial 

 

 

period of
employment and any subsequent periods of employment “at-will” by Transoma
Medical of Employee) and for a period of twelve (12) consecutive months from
the date of termination of such employment for whatever reason (whether
occasioned by Employee or Transoma Medical) (“the Period”), Employee agrees that
he or she will not directly or indirectly render services (including services
in research) to any person or entity in connection with the design,
development, manufacture, marketing, or sale of a Competing Product that is
sold or intended for use or sale in any geographic area in which Transoma
Medical actively markets a product of Transoma Medical or intends to actively
market a product of Transoma Medical of the same general type or function. At
the conclusion of the Period, the Company may, at its election, extend the
provisions of this Section 5.1 for up to an additional six months (“Extended
Period”). During the Extended Period, the Employee is eligible to receive
Employee’s final monthly base salary (“the Compensation”) for each month during
the Extended Period that Employee can reasonably demonstrate that Employee is
searching for employment and would have received employment in the absence of
the provisions of this Section. It is expressly understood that the Employee is
free to work for a competitor of Transoma Medical, provided that such
employment does not include any responsibilities for, or in connection with, a
Competing Product as defined in this Agreement for the Period and the Extended
Period.

 

5.2                                 Agreement
Not to Compete, Sales Positions. If the Employee’s only responsibilities
for Transoma Medical during the last two (2) years of employment have been in a
field sales or field sales management capacity, then Section 5.1 shall apply to
only prohibit for eighteen (18) consecutive months the Employee’s provision of
services in connection with the sale of a Competing Product to persons or
entities located in any sales territory the Employee covered or supervised for
Transoma Medical during the last year of employment.

 

5.3                                 Nonsolicitation
of Customers. During the term of Employee’s employment by Transoma Medical
or any affiliate of Transoma Medical (the period to include Employee’s initial
period of employment and any subsequent periods of employment “at-will” by
Transoma Medical of Employee), and for a period of eighteen (18) months from
the date of termination of such employment for whatever reason (whether
occasioned by Employee or Transoma Medical), Employee agrees that he or she
will not, directly or indirectly, either individually, in partnership, jointly,
or in conjunction with any person, firm, partnership, limited liability
company, corporation, or unincorporated association of any kind, whether as
principal, agent, shareholder, or in any other capacity whatsoever, divert,
solicit or accept business from any of the customers of Transoma Medical, or
actively seek its prospective customers, for the purposes of providing
Competing Products directly or indirectly in the United States, or in a
country, in which Transoma Medical has a plant for manufacturing a product upon
which Employee worked during Employee’s employment by Transoma Medical or in
which Transoma Medical provides a service in which Employee participated during
Employee’s employment by Transoma Medical.

 

5.4                                 Nonsolicitation
of Employees. During the term of Employee’s employment by Transoma Medical
or any affiliate of Transoma Medical (the period to include Employee’s initial 

 

 

period of
employment and any subsequent periods of employment “at-will” by Transoma
Medical of Employee), and for a period of eighteen (18) months from the date of
termination of such employment for whatever reason (whether occasioned by
Employee or Transoma Medical), Employee will not, directly or indirectly,
either individually, in partnership, jointly, or in “conjunction with any
person, firm, partnership, limited liability company, corporation, or
unincorporated association of any kind, whether as principal, agent,
shareholder, or in any other capacity whatsoever, hire, engage, solicit or
otherwise directly or indirectly interfere with or disrupt relationships,
contractual or otherwise, with any person who was an employee of Transoma
Medical at the time of the termination of Employee’s employment by Transoma
Medical, or whose employment was terminated within twelve (12) months prior to
Transoma Medical’s termination of such employee and whom Employee worked or
associated with, or supervised, in any manner or capacity, including but not
limited to as an employee, agent, consultant, partner, member, manager, officer,
director, shareholder, or otherwise.

 

5.5                                 Acknowledgement.
Employee agrees that the restrictions and agreements contained in this Section
5 are reasonable and necessary to protect the legitimate interests of Transoma
Medical, and that any violation of this Section 5 will cause substantial and
irreparable harm to Transoma Medical that would not be quantifiable and for
which no adequate remedy would exist at law. Employee further acknowledges that
Employee has requested, or has had the opportunity to request, that legal
counsel review this Agreement’s Section 5, and having exhausted such right,
agrees to the terms herein without reservation. Accordingly, Employee
authorizes the issuance of injunctive relief by any court of appropriate
jurisdiction, without the requirement of posting bond, for any violation of
this Section 5.

 

SECTION
6.         MISCELLANEOUS

 

6.1                                 Severability.
The covenants in this Agreement are fair and reasonable. Nonetheless, it is
agreed that if a court finds any of these covenants to be invalid in whole or
in part under the laws of any state, such finding will not invalidate such
covenant(s), but rather the covenant(s) will be construed as if the most
restrictive covenants permissible under applicable law were contained herein; provided,
that if such court refuses to so construe such covenant(s), then this
Agreement will be construed as if such provision is not contained herein
insofar as enforcement of this Agreement against Employee in such particular
state.

 

6.2                                 Remedies.
Any breach by Employee of any of the provisions of this Agreement will render
irreparable harm to Transoma Medical, and money damages may not be an adequate
remedy. Transoma Medical will therefore be entitled to any and all equitable
relief, including but not limited to, injunctive relief, to prevent new,
further, or continuing violations; and, further, to any other remedy that may
be available under any applicable law or agreement between the parties. Neither
the existence or exercise of any specific remedy is intended to be exclusive or
impair or otherwise adversely affect in any manner whatsoever any rights,
remedies, or relief otherwise available, and each and every right and remedy
will be cumulative and in addition to every other right and remedy provided in
this Agreement.

 

 

6.3                                 Assignment.
Transoma Medical will have the right to assign this contract to its successors
or assigns, and all covenants or agreements hereunder, including this
provision, shall inure to the benefit of and be enforceable solely by its
successors or assigns.

 

6.4                                 Voluntary
Agreement. Prior to signing this Agreement, Employee has read it carefully
and understands its terms and Employee’s obligations. Employee understands that
this Agreement is a condition of Employee’s employment with Transoma Medical.
Employee has had the opportunity first to discuss this Agreement any concerns
or questions Employee has about it with counsel of his or her choice and with
Transoma Medical. Employee agrees that this Agreement is reasonable, and a fair
means for Transoma Medical to protect its Confidential Information. Employee
signs this Agreement voluntarily, without coercion or duress.

 

6.5                                 Survival.
Employee understands that Employee’s obligations in this Agreement survive the
termination of Employee’s employment with Transoma Medical in the future,
regardless of the reason for termination, and regardless of whether termination
was voluntary or involuntary.

 

6.6                                 Legal
& Equitable Remedies. Employee’s services are personal and unique and
because Employee shall have access to and shall become acquainted with the
Confidential Information of Transoma Medical, Transoma Medical shall have the
right to enforce this Agreement and any of its provisions by injunction,
specific performance or other equitable relief, without bond and without
prejudice to any other rights and remedies that Transoma Medical may have for a
breach of this Agreement.

 

6.7                                 Prior
Agreements. Any and all previous agreements between Transoma Medical and
Employee are hereby terminated by the parties. This Agreement and the exhibits
attached hereto and hereby incorporated herein contain the entire agreement of
Transoma Medical and the Employee relating to the employment of Employee by
Transoma Medical and the ancillary matters discussed herein and supersedes and
replaces any and all prior agreements (including but not limited to the
Original Agreement and understandings with respect to such matters, and the
parties hereto have made no agreements, representations or warranties relating
to such employment or ancillary matters which are not set forth herein.

 

6.8                                 Amendments.
No amendment or modification of this Agreement shall be deemed effective unless
made in writing and signed by both Employee and Transoma Medical.

 

6.9                                 No
Waiver. No term or condition of this Agreement shall be deemed to have been
waived, nor shall there be any estoppel to enforce any provisions of this
Agreement, except by a statement in writing signed by the party against whom
enforcement of the waiver or estoppel is sought. Any written waiver shall not
be deemed a continuing waiver unless specifically stated, shall operate only as
to the specific term or condition waived and shall not constitute a waiver of
such term or condition for the future or as to any act other than that
specifically waived.

 

 

6.10                           Counterparts.
This Agreement may be simultaneously executed in any number of counterparts,
anyone of which need not contain the signatures of more than one of the parties
and any or all of which may be facsimile, but all of which taken together shall
constitute one and the same instrument.

 

6.11                           Captions
& Headings. The captions and section headings used in this Agreement
are for convenience of reference only, and shall not affect the construction or
interpretation of this Agreement or any of the provisions hereof.

 

6.12                           Past
Representations, Employment. Employee warrants and confirms, as a condition
of this Agreement and Employee’s employment, that the information previously
provided to Transoma Medical and contained in any resume, curriculum vitae or other writing furnished by the Employee; as well as in any
oral representations made by the Employee, regarding the Employee’s
qualifications (including, but not limited to, educational background, degrees,
job history, et cetera), were truthful, accurate, and not
misleading. The Employee further warrants that Employee is free to enter into
and perform this Agreement and that by doing so the Employee will not be in
breach of any obligation to any third party, including, but not limited to, any
former employer of Employee.

 

6.13                           Employment
at Will. Employee and Transoma Medical understand and agree that the
Employee’s employment with Transoma Medical is “at will.” Employee and Transoma
Medical understand and agree that the phrase “at will” is intended to mean that
either Transoma Medical or the Employee may end their employment relationship
at any time, for any reason. Employee and Transoma Medical agree that this
Agreement is not intended to be and should not be construed as an employment
contract that determines or affects the duration of the Employee’s employment
or any other terms or conditions of the Employee’s employment, except for those
set forth herein.

 

[The remainder of this page is left blank
intentionally;

 signature
page follows.]

 

 

IN WITNESS WHEREOF, Employee and Transoma Medical have
executed this Agreement as of the date set forth in the first paragraph.

 

	
   

  	
  TRANSOMA MEDICAL INTERNATIONAL,

  INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EMPLOYEE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  [Name
  of Employee]

  
					

 

 

EXHIBIT A

 

LIST OF PRIOR INVENTIONS

 

Transoma Medical,
Inc.

4211 Lexington
Avenue North, Suite 2244

Arden Hills,
MN  55126-6164

To Whom It May Concern:

 

1.             Except as listed in
section 2 below, the following is a complete disclosure of all inventions,
original works of authorship, developments, improvements, and trade secrets
that Employee has alone or jointly with others, conceived, developed or reduced
to practice or caused to be conceived, developed or reduced to practice prior
to the date of this Agreement, that Employee considers to be Employee’s
property or the property of third parties and that Employee wishes to have
excluded from the scope of this Agreement.

 

o            No Inventions or
Improvements.

 

o            See below.

 

o            Additional sheets
attached.

 

2.             Due to a prior
confidentiality agreement, I cannot complete the disclosure under section 1
above with respect to inventions or improvements generally listed below, the
proprietary rights and duty of confidentiality with respect to which I owe to
the following party(ies):

 

	
   

  	
   

  	
  Invention or Improvement

  	
   

  	
  Party(ies)

  	
   

  	
  Relationship

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

o            Additional Sheets
attached.

 

3.             I propose to bring to
my employment the following devices, materials and documents of a former
employer or other person whom I have an obligation of confidentiality that are
not generally available to the public, which materials and documents may be
used in my employment pursuant to the express written authorization of my
former employer or such other person (a copy of which is attached hereto):

 

o            No Inventions or
Improvements.

 

o            See below.

 

o            Additional sheets
attached.

 

 

	
  Date:                                ,
  20           

  	
  EMPLOYEE

  
	
   

  	
   

  
	
   

  	
  [Name of Employee]

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