Document:

Exhibit 10.9

 

COHERENT, INC.

 

VARIABLE COMPENSATION PLAN

 

SECTION 1

BACKGROUND, PURPOSE AND DURATION

 

1.1        Effective Date.  The Plan was adopted effective as of October 4, 2009 and will remain in effect until
terminated by the Board or the Administrator.

 

1.2        Purpose of the Plan.  The Plan is intended to increase shareholder
value and the success of the Company by motivating selected employees (a) to
perform to the best of their abilities and (b) to achieve the Company’s
objectives.

 

SECTION 2

DEFINITIONS

 

The following
words and phrases shall have the following meanings unless a different meaning
is plainly required by the context:

 

2.1        “Actual Award”
means as to any Performance Period, the actual award (if any) payable to a
Participant under the Plan for the Performance Period, subject to the
Administrator’s authority under Section 3.4 to modify the award.

 

2.2        “Administrator”
means the Compensation Committee of the Board or officers of the Company as
delegated by the Compensation Committee of the Board.  The Compensation Committee of the Board may
appoint different officers to administer the Plan with respect to different
groups of Employees and/or Participants.

 

2.3        “Affiliate” means
any corporation or other entity (including, but not limited to, partnerships
and joint ventures) controlled by the Company.

 

2.4        “Base Salary” means
as to any Performance Period, the Participant’s annualized salary rate on the
last day of the Performance Period.  Such
Base Salary shall be before both (a) deductions for taxes or benefits, and
(b) deferrals of compensation pursuant to Company sponsored plans and
Affiliate sponsored plans.

 

2.5        “Board” means the
Board of Directors of the Company.

 

2.6        “Bonus Pool” means
the pool of funds established by the Company for distribution to Participants.

 

2.7        “Company” means
Coherent, Inc., a Delaware corporation, or any successor thereto.

 

2.8        “Disability” means a
permanent and total disability determined in accordance with uniform and
nondiscriminatory standards adopted by the Administrator from time to time.

 

 

2.9        “Employee” means
any employee of the Company or of an Affiliate, whether such individual is so
employed at the time the Plan is adopted or becomes so employed subsequent to
the adoption of the Plan; provided, however that any Plan payout to a part-time
employee Participant shall be pro-rated based upon their scheduled hours of
work.

 

2.10      “Fiscal Year” means
the fiscal year of the Company.

 

2.11      “Participant” means
as to any Performance Period, an Employee who has been selected by the
Administrator for participation in the Plan for that Performance Period.

 

2.12      “Performance Period”
means the period of time for the measurement of the performance criteria that
must be met to receive an Actual Award, as determined by the Administrator in
its sole discretion.  A Performance
Period may be divided into one or more shorter periods if, for example, but not
by way of limitation, the Administrator desires to measure some performance
criteria over 12 months and other criteria over 3 months.  Multiple, overlapping Performance Periods (of
different durations) may be in effect at any one time.

 

2.13      “Plan” means this
Variable Compensation Plan, as set forth in this instrument and as hereafter
amended from time to time.

 

2.14      “Target Award” means
the target award, at 100% performance achievement, payable under the Plan to a
Participant for the Performance Period, as determined by the Administrator in
accordance with Section 3.2.

 

2.15      “Termination of Service”
means a cessation of the employee-employer relationship between an Employee and
the Company or an Affiliate for any reason, including, but not by way of
limitation, a termination by resignation, discharge, death, Disability,
retirement, or the disaffiliation of an Affiliate, but excluding any such
termination where there is a simultaneous reemployment by the Company or an
Affiliate.

 

SECTION 3

SELECTION OF PARTICIPANTS AND DETERMINATION OF AWARDS

 

3.1        Selection of
Participants.  The Administrator, in
its sole discretion, shall select the Employees who shall be Participants for
any Performance Period.  Participation in
the Plan is in the sole discretion of the Administrator, and shall be
determined on a Performance Period by Performance Period basis.  Accordingly, an Employee who is a Participant
for a given Performance Period in no way is guaranteed or assured of being
selected for participation in any subsequent Performance Period or
Periods.  Unless determined otherwise by
the Administrator, in its discretion, any Employee who is a participant in a
Company commission plan or program or is party to an agreement with the Company
which provides for payment of commissions will not be eligible to be a Participant in the Plan.

 

3.2        Determination of Target
Awards.  The Administrator, in its
sole discretion, shall establish a Target Award for each Participant.

 

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3.3        Bonus Pool.  Each Performance Period, the Administrator,
in its sole discretion, may establish a Bonus Pool.  Actual Awards for the relevant Performance
Period shall be paid from any such Bonus Pool, to the extent it is funded.

 

3.4        Discretion to Modify
Awards.  Notwithstanding any contrary
provision of the Plan, the Administrator may, in its sole discretion and at any
time, (a) increase, reduce or eliminate a Participant’s Actual Award,
and/or (b) increase, reduce or eliminate the amount allocated to the Bonus
Pool.  The Administrator may determine
the amount of any reduction on the basis of such factors as it deems relevant,
and shall not be required to establish any allocation or weighting with respect
to the factors it considers.

 

3.5        Discretion to Determine
Criteria.  Notwithstanding any
contrary provision of the Plan, the Administrator shall, in its sole
discretion, determine the performance requirements applicable to any Target
Award.  The requirements may be on the
basis of any factors the Administrator determines relevant, and may be on an
individual, divisional, business unit or Company-wide basis.  Failure to meet the requirements will result
in a failure to earn the Target Award, except as provided in Section 3.4.

 

3.6        Pro-Ration of Actual
Awards.  Without limiting the
generality of Section 3.4, with respect to any Performance Period, if an
Employee becomes a Participant after the commencement of the Performance
Period, the Participant’s Actual Award shall be pro-rated from the first day of
participation in the Plan based on the number of days during the Performance
Period that the Employee was a Participant in the Plan.

 

3.7        Discretion to Grant
Awards Outside the Plan.  Notwithstanding
any contrary provision of the Plan, the Board or a duly constituted committee
of the Board (or their delegates) may, in its sole discretion and at any time,
grant awards and cash bonuses to Employees and Participants outside the Plan.

 

SECTION 4

PAYMENT OF AWARDS

 

4.1        Right to Receive
Payment.  Each Actual Award shall be
paid in cash solely from the general assets of the Company.  No
provision of the Plan shall require the Company, for the purpose of satisfying
any obligations under the Plan, to purchase assets or place any assets in a
trust or other entity to which contributions are made or otherwise to segregate
any assets, nor shall the Company maintain separate bank accounts, books,
records or other evidence of the existence of a segregated or separately
maintained or administered fund for such purposes.  Participants shall have no rights under the
Plan other than as unsecured general creditors of the Company.

 

4.2        Timing of Payment.  Payment of each Actual Award shall be made as
soon as administratively practicable as determined by the Administrator after
the end of the Performance Period during which the Actual Award was earned, but
in no event later than (a) the 15th day of the third month following the
end of the Company’s taxable year in which the Performance Period has ended, or
(b) March 15th of the calendar year following the calendar year in
which the applicable Performance Period has ended.

 

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4.3       Form of Payment.  Each Actual Award shall be paid in cash in a
single lump sum.

 

SECTION 5

ADMINISTRATION

 

5.1        Administrator Authority.  It shall be the duty of the Administrator to
administer the Plan in accordance with the Plan’s provisions.  The Administrator shall have all powers and
discretion necessary or appropriate to administer the Plan and to control its
operation, including, but not limited to, the power to (a) determine which
Employees shall be granted awards, (b) prescribe the terms and conditions
of awards, (c) interpret the Plan and the awards, (d) adopt such
procedures and subplans as are necessary or appropriate to permit participation
in the Plan by Employees who are foreign nationals or employed outside of the
United States, (e) adopt rules for the administration, interpretation
and application of the Plan as are consistent therewith, and (f) interpret,
amend or revoke any such rules.

 

5.2        Decisions Binding.  All determinations and decisions made by the
Administrator, the Board, and any delegate of the Administrator pursuant to the
provisions of the Plan shall be final, conclusive, and binding on all persons,
and shall be given the maximum deference permitted by law.

 

5.3        Delegation of
Administration.  The Administrator,
in its sole discretion and on such terms and conditions as it may provide, may
delegate all or part of its authority and powers under the Plan to one or more
directors and/or officers of the Company. 
If the Administrator delegates
any authority for the administration of the Plan, the term “Administrator”
shall include the individuals delegated such authority.

 

5.4        Indemnification of
Administrator.  The Company shall
indemnify and hold harmless members of the Administrator, or any officer or
employee of the Company delegated authority with respect to the administration
of the Plan, for any expense, liability, or loss, including attorneys’ fees,
judgments, fines, penalties, amounts paid or to be paid in settlement, any
interest, assessments, or other charges imposed thereon, any federal, state,
local, or foreign taxes, and all other costs and obligations, paid or incurred
in connection with any action, determination or interpretation made in good
faith with respect to the Plan or any payments under the Plan.  The Company shall bear all expenses and
liabilities that members of the Administrator, or any officer of the Company
delegated authority with respect to the administration of the Plan, incur in
connection with the administration of the Plan.

 

SECTION 6

GENERAL PROVISIONS

 

6.1        Tax Withholding.  The Company shall withhold all applicable
taxes from any Actual Award, including any federal, state and local taxes
(including, but not limited to, the Participant’s FICA and SDI obligations).

 

6.2        No Effect on Employment
or Service.  Nothing in the Plan
shall interfere with or limit in any way the right of the Company to terminate
any Participant’s employment or service at any time, with or without
cause.  For purposes of the Plan,
transfer of employment of a Participant between the Company and any one of its
Affiliates (or between Affiliates) shall not be deemed a 

 

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Termination of
Service.  Employment with the Company and
its Affiliates is on an at-will basis only. 
The Company expressly reserves the right, which may be exercised at any
time and without regard to when during a Performance Period such exercise
occurs, to terminate any individual’s employment with or without cause, and to
treat him or her without regard to the effect that such treatment might have
upon him or her as a Participant.

 

6.3        Participation.  No Employee shall have the right to be
selected to receive an award under this Plan, or, having been so selected, to
be selected to receive a future award.

 

6.4        Successors.  All obligations of the Company under the
Plan, with respect to awards granted hereunder, shall be binding on any
successor to the Company, whether the existence of such successor is the result
of a direct or indirect purchase, merger, consolidation, or otherwise, of all
or substantially all of the business or assets of the Company.

 

6.5        Nontransferability of
Awards.  No award granted under the
Plan may be sold, transferred, pledged, assigned, or otherwise alienated or
hypothecated, other than by will, by the laws of descent and distribution, or
to the limited extent provided in Section 6.5.  All rights with respect to an award granted
to a Participant shall be available during his or her lifetime only to the
Participant.

 

6.6        Section 409A of
the Code.  It is intended that the
Plan shall be exempt from Section 409A of the Internal Revenue Code of
1986, as amended (“Section 409A”), pursuant to the requirement that all
payments hereunder shall be paid within the applicable short-term deferral
period as set forth in Section 1.409A-1(b)(4) of the final
regulations issued under Section 409A. 
The Administrator shall administer and interpret the Plan in a manner
consistent with this short-term deferral exception and any other regulations or
other Internal Revenue Service guidance issued with respect to Section 409A.

 

SECTION 7

AMENDMENT, TERMINATION AND DURATION

 

7.1        Amendment, Suspension
or Termination.  The Company, by
action of the Board or a duly constituted committee of members of the Board to
whom the Board has delegated the authority to amend or terminate the Plan, in
its sole discretion, may amend or terminate the Plan, or any part thereof, at
any time and for any reason. The amendment, suspension or termination of the
Plan shall not, without the consent of the Participant, alter or impair any
rights or obligations under any Actual Award theretofore earned by such
Participant.  No award may be granted
during any period of suspension or after termination of the Plan.

 

7.2        Duration of the Plan.  The Plan shall commence on the date specified
herein, and subject to Section 7.1 (regarding the Company’s right to amend
or terminate the Plan), shall remain in effect thereafter.

 

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SECTION 8

LEGAL CONSTRUCTION

 

8.1        Gender and Number.  Except where otherwise indicated by the
context, any masculine term used herein also shall include the feminine; the
plural shall include the singular and the singular shall include the plural.

 

8.2        Severability.  In the event any provision of the Plan shall
be held illegal or invalid for any reason, the illegality or invalidity shall
not affect the remaining parts of the Plan, and the Plan shall be construed and
enforced as if the illegal or invalid provision had not been included.

 

8.3        Requirements of Law.  The granting of awards under the Plan shall
be subject to all applicable laws, rules and regulations, and to such
approvals by any governmental agencies or national securities exchanges as may
be required.

 

8.4        Governing Law.  The Plan and all awards shall be construed in
accordance with and governed by the laws of the State of California, but
without regard to its conflict of law provisions.

 

8.5        Bonus Plan.  This Plan is intended to be a “bonus program”
as defined under U.S. Department of Labor regulation section 2510.3-2(c) and
shall be construed and administered by the Company in accordance with such
intention.

 

8.6        Captions.  Captions are provided herein for convenience
only, and shall not serve as a basis for interpretation or construction of the
Plan.

 

6exhibit1215.htm

CONSULTING AGREEMENT

 

1. Parties 

 

    This Consulting Agreement (this “Agreement”) is made and entered into effective as of the first day of November, 2009 (the “Effective Date”), by Arrayit Corporation (the “Company”), a Nevada corporation, whose address is 524 East
Weddell Drive, Sunnyvale, California 94089 and William L. Sklar (the “Consultant”), a citizen and resident of Canada whose address is 513 Roselawn Avenue, Toronto, Ontario, M5N 1K2, Canada.

 

2. Recitals

    2.1. This Agreement is made with reference to the following facts and circumstances:

 

(a) The Company is in the business of discovery, development and manufacture of proprietary life science technologies and consumables for disease prevention, treatment and cure.

 

(b) The Consultant is an experienced and qualified corporate executive as well as a financial expert who is capable of serving as a director and chief financial officer of the Company.

 

(c) The Company wishes to engage the Consultant to serve as a director and chief financial officer of the Company, on the terms set forth in this Agreement.

 

(d) The Company wishes to appropriately compensate the Consultant commensurate with his duties and responsibilities, but does not presently have sufficient cash resources to do so and does not have sufficient authorized but unissued common stock to compensate the Consultant.

 

(e) The Company is in the process o taking the necessary corporate and regulatory action to increase the number of common shares the Company is authorized to issue.  The date on which such increase is effective is referred to herein as the “Authorization Date.”

    2.2 In consideration of these recitals and the mutual promises set forth below, the Company and the Consultant are entering into this Agreement.

 

3. Engagement

3.1. Engagement. The Company hereby engages the Consultant to perform the Services described in paragraph 3.3 of this Agreement (the “Engagement”), and the Consultant hereby accepts the Engagement and agrees to perform the Services, on the terms set forth in this Agreement.

 

3.3. Term. The term of the Consultant’s Engagement under this Agreement (the “Term”) shall be for the period beginning on the Effective Date and ending when either the Consultant or the Company terminates the engagement as provided in section 4 of this Agreement.

 

3.2. Services. The scope of the services (the “Services”) to be rendered by the Consultant to the Company under this Agreement is, but is not limited to, the following:

 

(a) Promote the interests, within the scope of his duties, of the Company and devote his part working time and efforts to the Company’s business and affairs;

(b) Serve as Chief Financial Officer of the Company, reporting directly to the Chief Executive Officer of the Company;

 

(c) Serve as a Director of the Company and a member of the Company’s board of directors; and

 

(d) Perform the duties and services consistent with the title and function of such offices, including without limitation, those, if any, set forth in the bylaws of the Company or as specifically set forth from time to time by the Company’s Board of Directors.

  

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3.3. Timeline. The Consultant shall begin the Services on the Effective Date and shall continue to provide the Services until the termination of this Agreement.

 

3.4. Company’s Cooperation. The Company shall cooperate with the Consultant in the Consultant’s performance of the Services and shall provide the Consultant with all information relating to the Company that the Consultant may reasonably request in a timely manner.

 

3.5. Ownership of Work Product and Intellectual Property; Company’s License. All information created, developed, assembled, prepared or otherwise furnished by the Consultant in performing the Services, including any preliminary, interim and final reports, in whatever format,
whether written, printed, photographic, magnetic, electronic or other (collectively, the “Work Product”), is and shall remain the property of the Corporation. The Consultant acknowledges that the Company has the universal sole and exclusive copyright to the Work Product.

 

3.6. No Capital Raising Services. The Services do not include initiating or taking a leading role: (i) in connection with the offer or sale of securities in any capital-raising transaction, or (ii) directly or indirectly promoting or maintaining a market for any of the Company’s
securities.

 

3.7. Relationship. The relationship between the Company and the Consultant created by this Agreement is that of independent contractor, and the Consultant is not and shall not be deemed to be an employee of the Company for any purpose.

 

3.8. Location for Performance of Services. This is an outsourced engagement, and the Company and the Consultant intend that the Consultant shall perform the Services primarily from the Consultant’s offices. The Consultant shall not be required to perform any Services in the United
States, or in any manner that would subject the Consultant’s Fee (defined in section 4 below) to U.S. federal or state income taxation. The Consultant shall be reasonably available by telephone to consult with the Company. The Consultant shall, if requested by the Company and at the Company’s expense, attend meetings of the Company’s board of directors.

 

3.9 Time; Non-exclusive. The Consultant shall devote as much time to the performance of the Services as is reasonably necessary, but the Consultant shall not required to devote any fixed number of hours or days to the performance of the Services.  The Company understands and
acknowledges that the Consultant has and will continue to have other clients and business, and agrees that the Engagement is non-exclusive.

 

      3.10. Support Staff and Facilities. The Consultant shall furnish the Consultant's own support staff, office, telephone, and other facilities and equipment necessary to the performance of the Services, and the Company shall
not be required to provide the Consultant with any such staff, facilities or equipment.

 

4. Consultant’s Compensation and Expenses

4.1. Consultant’s Fee. On the Authorization Date, the Company shall issue the Consultant 150,000 shares of the Company’s common stock (the “Shares”) as compensation for the services and reimbursement of expenses for the period beginning February 2008 and ending
on the Effective Date.  Commencing on the Effective Date, the Company will compensate the Consultant for the services rendered by him by payment of $5,000 per month (the “Consultant’s Fee”).  At the end of each calendar quarter, any part of the Consultant’s Fee not paid in cash for the quarter then ending, shall be paid in Shares with a market value of $15,000 less the amount or amounts paid in cash during the quarter.  The “Market Value” is an
amount equal to the volume weighted average price (the "VWAP") of the Common Stock as listed on a Principal Market (as defined herein), as quoted by Bloomberg L.P.  Principal Market" shall mean The Financial Industry Regulatory Authority's Over-The-Counter Bulletin Board, Nasdaq SmallCap Market, or NYSE American Stock Exchange.  If the Common Stock is not traded on a Principal Market, the Closing Bid Price shall mean, the reported Closing Bid Price for the Common Stock, as furnished by the
Financial Industry Regulatory Authority, for the applicable periods.

 

  

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4.2. Shares; Certificate; Company Plan. On the Authorization Date, the Company shall issue and deliver a certificate for the 150,000 Shares to the Consultant, registered in the name of the Consultant, containing the customary restrictive legend for securities issued without registration
under the Securities Act of 1933. The Company shall irrevocably instruct its transfer agent to issue the certificates representing the Shares and deliver the Shares, so registered, to Consultant.

 

4.3. No Offset, Withholding, Taxes. The Company shall pay the Consultant the Consultant’s Fee without offset, withholding, or other deductions of any kind, whether for taxes or otherwise.  The Consultant shall indemnify the Company against and hold it harmless from any
taxes owed by the Consultant on the Consultant’s Fee to the United States or any state or other political subdivision thereof.

  

  4.4. The Consultant’s Expenses. Except for expenses that the Company has agreed to pay pursuant to paragraph 3.8 of this Agreement, or such other expenses as the Company shall agree in writing to pay or reimburse
to Consultant, the Consultant shall pay all expenses incurred by the Consultant in connection with the performance of the Services under this Agreement.

 

	
5.  
	
 Representations and Warranties

5.1. Representations and Warranties of the Company. The Company represents and warrants to the Consultant that:

 

(a) Incorporation, Good Standing, and Due Qualification. The Company is a corporation duly organized, validly existing, and in good standing under the laws of the state of Nevada, with full corporate power and authority to conduct the business in which it is now engaged and in which
it proposes to be engaged in, to own or use the assets that it purports to own or use; and the Company is duly qualified to do business as a foreign corporation and is in good standing under the laws of each state or other jurisdiction in which either the ownership or use of the assets owned or used by it, or the nature of the activities conducted by it, requires such qualification.

 

(b) Corporate Power and Authority.  The execution, delivery and performance of this Agreement by the Company, including the issuance of the Shares, have been duly authorized by all necessary corporate action of the Company, and do not and will not (i) require any consent or
approval of the Company’s shareholders; (ii) contravene the Company’s certificate of incorporation or bylaws; (iii) violate any provision of any law, rule, regulation, order, writ, judgment, injunction, decree, determination or award presently in effect having applicability to the Company; or (iv) result in a breach of or constitute a default under any agreement or other instrument to which the Company is a party.

 

(c) Legally Enforceable Agreement. This Agreement is the, legal, valid and binding obligation of the Company, enforceable against it in accordance with its terms, except to the extent that such enforcement may be limited by applicable bankruptcy, insolvency and other similar laws affecting
creditors’ rights generally.

 

(d) Reporting Company. The Common Stock is registered under the Securities Exchange Act of 1934 (the “Exchange Act”); the Company is a reporting company under the Exchange Act, and has filed in a timely manner all statements, reports and other documents required to be filed
by it under the Exchange Act and the regulations of the SEC.

(e) The Shares. The Shares are duly and validly authorized, and when issued will be fully paid, nonassessable, and duly and properly issued pursuant to and in accordance with the Plan.

 

  

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3.2. Representations and Warranties of the Consultant.  The Consultant represents and warrants to and covenants with the Company that:

 

(a) Citizenship and Residence. The Consultant is a citizen and resident of Canada.

 

(b) Power and Authority. The execution, delivery and performance by the Consultant of this Agreement, does not and will not (i) violate any provision of any law, rule, regulation, order, writ, judgment, injunction, decree, determination
or award presently in effect having applicability to the Consultant; (ii) result in a breach of or constitute a default under any agreement or other instrument to which the Consultant is a party.

 

(c) Legally Enforceable Agreement.  This Agreement is the, legal, valid and binding obligation of the Consultant, enforceable against the Consultant in accordance with its terms, except to the extent that such enforcement may
be limited by applicable bankruptcy, insolvency and other similar laws affecting creditors’ rights generally.

 

(d) Knowledge and Experience. The Consultant has such knowledge and experience in financial and business matters that the Consultant, either alone or together with the Consultant’s financial advisors, is capable of evaluating the
merits and risks of the Consultant’s election to receive the Consultant’s Fee in the form of the Shares, rather than in cash.

 

(e) Securities Laws. The Consultant acknowledges receipt of advice from the Company that (i) the Shares have not been registered under the Securities Act or qualified under any state securities or “blue sky” laws; (ii) it is
not anticipated that there will be any public market for the Shares; (iii) the Shares must be held indefinitely and the Consultant must continue to bear the economic risk of the investment in the Shares unless the Shares are subsequently registered under the Securities Act and such state laws or an exemption from registration is available; (iv) Rule 144 promulgated under the Securities Act (“Rule 144”) is not presently available with respect to the sales of any securities of the Company, and the Company
has made no covenant to make Rule 144 available; (v) when and if the Shares may be disposed of without registration in reliance upon Rule 144, such disposition can be made only in limited amounts in accordance with the terms and conditions of such Rule; (vi) the Company files reports with the Commission to make public information concerning the Company available as required by the Securities Exchange Act of 1934; (vii) a restrictive legend shall be placed on the certificates representing the Shares; and (viii)
a notation shall be made in the appropriate records of the Company’s transfer agent indicating that the Shares are subject to restrictions on transfer and the appropriate stop-transfer restrictions will be issued to such transfer agent with respect to the Shares.

4. Termination

 

4.1. Termination by the Company.  The Company may terminate this Agreement at any time by giving the Consultant written notice of its election to do so.  If the Company terminates this Agreement for any reason, the Consultant’s Fee shall be paid up to and including
the effective date of the termination.

  

  4.2. Termination
by the Consultant.  The Consultant may terminate this Agreement at any time by giving the Company written notice of his election to do so.  If the Consultant terminates this Agreement for any reason, the Consultant’s Fee shall be paid up to and including the effective date of the termination.

 

 

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5. Confidential Information

 

5.1. The Company’s Confidential Information. The Consultant understands, acknowledges and agrees that the Company has acquired, created and developed and will continue to acquire, create and develop proprietary and confidential information regarding its customers, operations,
methods of doing business, research and development, know-how, processes, trade secrets, computer programs and models, algorithms, finances (including all non-public financial statements and information), and other proprietary and confidential information belonging to the Company in whatever form, including written, magnetic, electronic and photographic. The Consultant also understands that in the course of the Consultant’s engagement under this Agreement the Consultant will be exposed to and will have
the opportunity to learn about the Company’s confidential information. As used in this Agreement, the term, “Confidential Information,” includes all documents, materials, and information concerning the Company, or its existing or prospective clients or customers, that are furnished, made available, or otherwise disclosed to the Consultant by the Company or on its behalf, except information that was or becomes generally available to the public other than as a result of its disclosure by the Consultant.

 

5.2. Confidentiality Agreement. The Consultant agree to keep all Confidential Information strictly confidential, and to not disclose any Confidential Information to any person for any purpose, except (i) to other employees of the Company as may be required in the course of the Engagement,
and (ii) as may be legally required pursuant to paragraph 5.3 below.

 

5.3 Notice to Company. If I am requested or required by valid legal process (such as subpoena, search warrant or court order) to disclose any information (including
any Confidential Information) supplied to or acquired by me in the course of my employment with the Company, the Consultant will immediately notify the Company of receipt of such legal process as far in advance of such disclosure as is possible in order that the Company may seek, at its expense, an appropriate protective order, and the Consultant will make reasonable efforts to cooperate with the Company should it seek such an order.

 

6. General Provisions

 

    6.1. Consultant Not Doing Business in US. The Company acknowledges and agrees that (i) the Consultant's negotiation and execution of this Agreement has occurred outside of the jurisdiction of the United States,
(ii) the Consultant's performance of this Agreement will occur outside of the jurisdiction of the United States, and (iii) the Consultant's negotiation, execution and performance of this Agreement do not and will not constitute the Consultant's doing business within the jurisdiction of the United States for any purpose whatsoever.

 

    6.2. Entire Agreement; Modification; Waivers. This Agreement contains the entire agreement of the Company and the Consultant with respect to the Engagement, and supersedes any prior agreements with respect to
its subject matter. There are no agreements, understandings or arrangements of the parties with respect to the subject matter of this Agreement that are not contained herein.  This Agreement shall not be modified except by an instrument in writing signed by the parties. No waiver of any provision of this Agreement shall be effective unless made in writing and signed by the party making the waiver. The waiver of any provision of this Agreement shall not be deemed to be a waiver of any other provision
or any future waiver of the same provision.

 

    6.3. Notices. All notices given under this Agreement shall be in writing, addressed to the parties as set forth below, and shall be effective on the earliest of (i) the date received, or (ii) on the second
business day after delivery to a major international air delivery or air courier service (such as Federal Express or Network Couriers):

If to the Company: 

 

Arrayit Corporation

524 East Weddell Drive

Sunnyvale, California 94089

Attention: Rene' A. Schena

Chief Executive Officer

 

 

If to the Consultant:

 

William L. Sklar

513 Roselawn Avenue

Toronto, Ontario

M5N 1K2

Canada

 

 

6.4. Governing Law.  This Agreement shall be governed by, and construed in accordance with the laws of the State of Nevada; provided, however, that if any provision of this Agreement is unenforceable under such law
but is enforceable under the laws of the State of California, then California law shall govern the construction and enforcement of that provision.

 

6.5. Dispute Resolution—Mandatory Arbitration. Any dispute, controversy or claim arising out of or relating to this Agreement or to a breach hereof, including its interpretation, performance or termination, shall be finally resolved by arbitration. The arbitration shall be conducted
by three (3) arbitrators, one to be appointed by the Company, one to be appointed by Consultant, and the third to be nominated by the two arbitrators so selected or, if they cannot agree on the third arbitrator, by the President of the American Arbitration Association. In the event any such dispute, controversy or claim involves a claim of damages for fifty-thousand United States dollars ($50,000 U.S.) or less, the arbitration shall be conducted by one

(1) arbitrator appointed by the Company and the Consultant, or if they cannot agree on an arbitrator, by the President of the American Arbitration Association.

 

6.6. Jurisdiction and Venue.  The Superior Court of the County of Santa Clara sitting in the City of San Jose, California, (the “California Court”) shall have exclusive jurisdiction to hear, adjudicate, decide, determine and enter final judgment in any action,
suit, proceeding, case, controversy or dispute, whether at law or in equity or both, and whether in contract or tort or both, arising out of or related to this Agreement, or the construction or enforcement hereof or thereof (any such action, suit, proceeding, case, controversy or dispute, a “Related Action”), that is not subject to or determined by the mandatory arbitration clause set forth in paragraph 6.5 of this Agreement. The Company and the Consultant hereby irrevocably consent and submit to
the exclusive personal jurisdiction of the California Courts to hear, adjudicate, decide, determine and enter final judgment in any Related Action. The Company and the Consultant hereby irrevocably waive and agree not to assert any right or claim that it, he or she is not personally subject to the jurisdiction of the California Courts in any Related Action, including any claim of forum non conveniens or that the California Courts are not the proper venue
or form to adjudicate any Related Action. If any Related Action is brought or maintained in any court other than the California Courts, then that court shall, at the request of the Company or the Consultant, dismiss that action. Either party may enter a judgment rendered by the California Courts under this Agreement for enforcement in any court having jurisdiction over the party against whom such judgment is taken, and the party against whom such judgment is taken shall not contest the authority of such courts
to enforce such a judgment. The prevailing party in any Related Action shall be entitled to recover that party’s reasonable costs of suit, including reasonable attorney’s fees.

 

6.7 Binding Effect.  This Agreement shall be binding on, and shall inure to the benefit of the company and the Consultant, and their respective successors in interest.

 

6.8 Construction, Counterparts. This Agreement shall be construed as a whole and in favor of the validity and enforceability of each of its provisions, so as to carry out the intent of the parties as expressed herein. Heading are for the convenience of reference, and the meaning and
interpretation of the text of any provision shall take precedence over its heading. This Agreement may be signed in one or more counterparts, each of which shall constitute an original, but all of which, taken together shall constitute one agreement. A faxed copy or photocopy of a party’s signature shall be deemed an original for all purposes.

  

5

  

IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective Date.

 

The Company: 

 

ARRAYIT CORPORATION

 

 

By:_____________________________________ 

    Rene' A. Schena

    Chief Executive Officer

 

 

The Consultant:

 

 

By:_____________________________________

    William L. Sklar

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