Document:

Filed by Bowne Pure Compliance

 

Exhibit 10.62

PARTICIPATION AGREEMENT

THIS PARTICIPATION AGREEMENT (this “Agreement”) dated June 22, 2007 is between Tyson Foods,
Inc., a Delaware corporation (“Tyson”), and Syntroleum Corporation, a Delaware corporation
(“Syntroleum”).

RECITALS

WHEREAS, Syntroleum is pursuing or may pursue various project opportunities outside the United
States that consist of designing, developing, constructing and operating Biofined Renewable Fuels
Production Plants either alone or with one or more third parties;

WHEREAS, Syntroleum is pursuing or may pursue various project opportunities on a world wide
basis that consist of designing, developing, constructing and operating BTL Production Plants
either alone or with one or more third parties;

WHEREAS, Tyson desires to have the right to have an equity participation in the ownership of
such Biofined Renewable Fuels Production Plants and BTL Production Plants subject to the terms and
conditions contained herein; and

WHEREAS, based on Tyson’s investment in and support of Syntroleum’s first Biofined Renewable
Fuels Production Plant, Syntroleum desires to grant Tyson the right to have an equity participation
in the development and ownership of such Biofined Renewable Fuels Production Plants and BTL
Production Plants subject to the terms and conditions contained herein.

NOW THEREFORE, in consideration of these premises and the mutual promises and covenants set
forth herein, Tyson and Syntroleum mutually agree as follows:

ARTICLE 1

DEFINITIONS

1.1 Definitions. Capitalized terms used herein shall have the meanings given such
terms in this Section 1.1:

“Affiliate” means, with respect to a Person, any other Person directly or indirectly
controlling, controlled by or under common control with such Person.

“Bio Feedstock” means animal fats and other feedstocks, including, but not limited to,
vegetable oils, yellow, brown and recycled grease, glycerin, glycerol, palm oil, soybean oil and
other bio-oils, but excluding any material or product produced from a Fischer-Tropsch synthesis
process.

“Biofined Renewable Fuels” means renewable fuels including, but not limited to, iso-paraffinic
kerosene, jet fuel, diesel, naphtha, petroleum jelly and liquefied petroleum gas.

 

 

 

“Biofined Renewable Fuels Production Plant” means a production plant capable of producing
Biofined Renewable Fuels solely from Bio Feedstock using Biofining Technology.

“Biofining Technology” means Syntroleum’s proprietary technology for making Biofined Renewable
Fuels without the use of a Fischer-Tropsch synthesis process.

“BTL Feedstock” means all renewable feedstocks, including, but not limited to, vegetable oils,
yellow, brown and recycled grease, animal fats and oils, animal, industrial and human waste,
woodchips, cellulosic plant material, glycerin, glycerol, palm oil, soybean oil and other bio-oils,
but excluding coal, petroleum and natural gas.

“BTL Production Plant” means a production plant capable of producing Biofined Renewable Fuels
via gasification and a Fischer-Tropsch synthesis process from BTL Feedstock.

“BTL Technology” means Syntroleum’s proprietary technology for making Biofined Renewable Fuels
with the use of a Fischer-Tropsch synthesis process and including third-party gasification
technology.

“Commercial Royalty” means a commercially reasonable arms-length upfront or running royalty.

“Developer” means the Person with primary responsibility for the development of a Development
Project.

“Development Project” means the development of a Biofined Renewable Fuels Production Plant or
a BTL Production Plant.

“Equity Participation” means, with respect to a Development Project or a Plant, an ownership
interest in such Development Project or Plant or the right to receive a share of the revenue
generated by such Development Project or Plant including but not limited to any royalty in respect
of the licensing of Bio Technology except a Commercial Royalty.

“Feasibility Study” means a written report evaluating a possible Development Project,
including a review of site locations, preliminary engineering design and the economic analysis with
respect to such possible Development Project.

“LLC Agreement” means the Limited Liability Company Agreement of Dynamic Fuels, LLC dated as
of even date herewith between Syntroleum and Tyson.

“Party” means either Syntroleum or Tyson, as the context so requires, and “Parties” means
collectively Syntroleum and Tyson.

“Person” means any individual, partnership, corporation, limited liability company,
unincorporated organization or association, trust (including the trustees thereof, in their
capacity as such) or other entity.

“Plant” means a Biofined Fuels Production Plant or a BTL Production Plant.

 

 

 

“Project Proposal” means, with respect to any Development Project, the Feasibility Study for
such Development Project, the amount and terms of Syntroleum’s Equity Participation in such
Development Project, the past costs that would be assumed by Tyson, and, if available, a business
plan, a financing plan including sources and uses of equity and debt, a financial model and other
relevant information with respect thereto necessary for a prudent investor to make an informed
decision to participate in such Development Project.

“Syntroleum Group” means Syntroleum and any Affiliate of Syntroleum.

ARTICLE 2

PARTICIPATION

2.1 Participation Rights.

(a) Subject to the terms and conditions contained herein, Syntroleum hereby grants
Tyson the right to have an Equity Participation in each Development Project for a Biofined
Renewable Fuels Production Plant located outside the United States in which a member of the
Syntroleum Group has an Equity Participation either alone or with third parties (“Biofining
Participation Rights”). Such Equity Participation shall be limited to fifty percent (50%)
of the Syntroleum Group’s Equity Participation in such Development Project and shall be
offered on the same terms and conditions that Syntroleum Group has its Equity Participation
in such Development Project. Following the expiration of the exclusivity restrictions
imposed on Syntroleum pursuant to Section 5.2(a) of the LLC Agreement or Section 2.03 of the
Syntroleum Biofining Technology Master License, the Biofining Participation Rights shall
apply on a world wide basis. Notwithstanding anything herein to the contrary, Tyson shall
have no right to have an Equity Participation in any Biofined Renewable Fuels Production
Plant to which Syntroleum is only licensing Biofining Technology in consideration for the
payment of a Commercial Royalty.

(b) Subject to the terms and conditions contained herein, Syntroleum hereby grants
Tyson the right to have an Equity Participation in each Development Project for each BTL
Production Plant on a world wide basis in which a member of the Syntroleum Group has an
Equity Participation either alone or with third parties. Such Equity Participation shall be
limited to fifty percent (50%) of the Syntroleum Group’s Equity Participation in such
Development Project and shall be offered on the same terms and conditions that Syntroleum
Group has its Equity Participation in such Development Project. Notwithstanding anything
herein to the contrary, Tyson shall have no right to have an Equity Participation in any BTL
Production Plant to which Syntroleum is only licensing BTL Technology in consideration for
the payment of a Commercial Royalty.

(c) With respect to each Development Project in which a member of Syntroleum Group does
not have an Equity Participation or to which Syntroleum is just licensing Biofining
Technology in consideration for the payment of a Commercial Royalty, Syntroleum’s sole
obligation to Tyson in respect to such Development Project will be (i) to notify Tyson
thereof and (ii) if requested by Tyson, to introduce Tyson to the project participants of
such Development Project so that Tyson may have the opportunity to offer to supply the Bio Feedstock or have an Equity Participation in
such Development Project.

 

 

 

2.2 Feasibility Study.

(a) With respect to each Development Project in which a member of Syntroleum Group is
considering owning an Equity Participation, Syntroleum shall prepare and complete a
Feasibility Study either alone or in conjunction with the other potential project
participants. Upon the completion of each Feasibility Study, Syntroleum shall determine
whether it will pursue such Development Project. If Syntroleum makes the determination that
a member of Syntroleum Group intends to pursue such Development Project, it will offer Tyson
the right to participate in such Development Project in accordance with Section 2.3 hereof.

(b) Tyson hereby acknowledges that during the preparation of a Feasibility Study for a
Development Project, Syntroleum will be or may be negotiating various commercial
relationships, terms and agreements that will govern Syntroleum’s interest (equity or
otherwise) in such Development Project and that Syntroleum shall not be required to alter
such commercial relationships, terms and agreements should Tyson make an election to
participate.

(c) If Syntroleum is the Developer of such Development Project, Syntroleum will not
develop any commercial relationship, term or agreement reasonably likely to prevent Tyson
from participating in such Development Project and Tyson shall have the right to participate
directly in such Development Project.

(d) If Syntroleum is not the Developer of such Development Project, Syntroleum will use
reasonable commercial efforts to ensure that such Development Project does not include a
commercial relationship, term or agreement reasonably likely to prevent Tyson from
participating in such Development Project. If the Developer of such Development Project is
unwilling to have Tyson directly participate in such Development Project, then Syntroleum
and Tyson shall establish a participation structure permitting Tyson to participate in the
Development Project in a manner reasonably satisfactory to Syntroleum and Tyson which
provides Tyson with the economic benefits that Tyson would otherwise receive through a
direct participation in such Development Project.

2.3 Procedures.

(a) For each Development Project that Syntroleum intends to pursue and develop,
Syntroleum shall deliver to Tyson a Project Proposal for such Development Project and will
offer Tyson the right to have an Equity Participation in the Development Project subject to
the terms and conditions contained herein.

 

 

 

(b) Syntroleum shall give Tyson at least thirty (30) days prior written notice before
delivering a Project Proposal for a Development Project to Tyson (each a “Pre-Notification”)
setting forth the name, location, principal participants and general description of such
Development Project. In response to each Pre-Notification delivered
hereunder, Tyson shall notify Syntroleum within ten (10) days of receipt of the
Pre-Notification whether Tyson is an equity or revenue sharing participant in an existing
third party Development Project located within the lesser of (i) the same country and (ii)
two hundred and fifty (250) miles of the Development Project specified in the
Pre-Notification delivered by Syntroleum. If Tyson is an equity or revenue sharing
participant in any such third party Development Project, Syntroleum will have no obligation
to make a Project Proposal to Tyson considering such Development Project and such
Development Project shall be excluded from the terms of this Agreement.

(c) Upon receipt by Tyson of a Project Proposal from Syntroleum, Tyson shall have sixty
(60) days from the receipt thereof to notify Syntroleum in writing that Tyson either elects
to participate in the Development Project that is subject of the Project Proposal or that
Tyson declines to participate in such Development Project. If Tyson elects to participate
in a Development Project, such election shall also specify the amount of Tyson’s Equity
Participation in such Development Project. Failure of Tyson to respond within such sixty
(60) day period shall be deemed to be an affirmative election by Tyson to not request an
Equity Participation in such Development Project. If Tyson elects not to participate in a
Development Project, Syntroleum shall still be obligated to offer Tyson the right to
participate in future Development Projects during the term of this Agreement. All costs
incurred by Tyson in evaluating whether to participate in a Development Project shall be
Tyson’s sole obligation and Syntroleum shall have no responsibility therefor.

(d) If Tyson elects to have an Equity Participation in a Development Project, Tyson
will reimburse Syntroleum for the portion of the reasonable and documented costs incurred by
Syntroleum in its capacity as a holder of an Equity Participation in the Development Project
to date, including but not limited to the preparation of the Feasibility Study and the
Project Proposal, equal to Tyson’s pro rata share of such costs as determined by the portion
of such Equity Participation taken by Tyson in such Development Project as compared to the
Equity Participation taken by Syntroleum.

ARTICLE 3

BIO FEEDSTOCK SUPPLY

3.1 Bio Feedstock Supply. Tyson hereby acknowledges that, prior to the completion of
the Feasibility Study for a Development Project, a third party may have agreed to supply the Bio
Feedstock for such Development Project in which case Tyson shall have no right to suspend or alter
such Bio Feedstock supply agreement. If Tyson elects to participate in a Development Project
without an agreed supply of Bio Feedstock, Tyson shall have the right, but not the obligation, to
offer to supply the Bio Feedstock for such Development Project.

 

 

 

ARTICLE 4

TERM

4.1 Biofined Renewable Fuels Production Plant Term. Syntroleum’s obligation to offer
Tyson the right to Equity Participations in Development Projects for Biofined Renewable Fuels
Production Plants shall terminate on the first to occur of:

(a) the date upon which Tyson breaches its economic obligations in any material respect
with respect to a Development Project for a Biofined Renewable Fuels Production Plant in
which Tyson has elected to take an Equity Participation hereunder with respect to which
there has not been any material change in economics (actual or estimated) or any material
change in governmental risk, law, partner risk or any other material change since the date
of such election;

(b) the date that Tyson owns directly or indirectly less than ten percent (10%) of the
equity interest of the Company (as such term is defined in the LLC Agreement); and

(c) the last to occur of:

(i) the ten (10) year anniversary of the date of this Agreement;

(ii) two (2) years after the Development Activities Completion Date (as such
term is defined in the LLC Agreement); and

(iii) the three (3) year anniversary of the date of Tyson electing to
participate in a Development Project for a Biofined Renewable Fuels Production Plant
pursuant to Section 2.3(c) hereof prior to the later of (1) the ten (10) year
anniversary of the date of this Agreement and (2) two (2) years after the
Development Activities Completion Date,; provided, however, that if Tyson elects to
participate in a subsequent Development Project for a Biofined Renewable Fuels
Production Plant prior to such three (3) year anniversary, the date for purposes of
this Section 4.1(c)(iii) shall be the three (3) year anniversary of the date of such
subsequent election.

4.2 BTL Production Plant Term. Syntroleum’s obligation to offer Tyson the right to
Equity Participations in Development Projects for BTL Production Plants shall terminate on the
first to occur of:

(a) the date upon which Tyson breaches its economic obligations in any material respect
with respect to a Development Project for a BTL Production Plant in which Tyson has elected
to take an Equity Participation hereunder with respect to which there has not been any
material change in economics (actual or estimated) or any material change in governmental
risk, law, partner risk or any other material change since the date of such election;

(b) the date that Tyson owns directly or indirectly less than ten percent (10%) of the
equity interest of the Company; and

(c) the last to occur of:

 

 

 

(i) the ten (10) year anniversary of the date of this Agreement;

(ii) two (2) years after the Development Activities Completion Date; and

(iii) the three (3) year anniversary of the date of Tyson electing to
participate in a Development Project for a BTL Production Plant pursuant to Section
2.3(c) hereof prior to the later of (1) the ten (10) year anniversary of the date of
this Agreement and (2) two (2) years after the Development Activities Completion
Date,; provided, however, that if Tyson elects to participate in a subsequent
Development Project for a BTL Production Plant prior to such three (3) year
anniversary, the date for purposes of this Section 4.2(c)(iii) shall be the three
(3) year anniversary of the date of such subsequent election.

ARTICLE 5

MISCELLANEOUS

5.1 Amendments. This Agreement may not be amended or supplemented except by the
written agreement of the parties hereto.

5.2 Entire Agreement. This Agreement constitutes the entire agreement between the
Parties with respect to the subject matter hereof and supersedes any prior agreement or
understanding between them with respect to such subject matter.

5.3 Severability. In the event any provision or portion of a provision hereof is held
to be invalid, void, or unenforceable by a court of competent jurisdiction or a governmental agency
with jurisdiction, such holding shall not affect the remaining portion of that provision or any
other provision hereof.

5.4 Notices. All notices, requests, demands and other communications hereunder shall
be in writing and shall be deemed to have been duly given if: (a) delivered or mailed, registered
mail, first-class postage paid or (b) transmitted via facsimile, if to any Party, at such Party’s
address, or to such Party’s facsimile number, set forth below, or to such other Person or address
as any Party shall have last designated by notice to the other Party. Any notice shall be deemed
to have been duly given if personally delivered or sent by the mails or by facsimile transmission
and will be deemed received, unless earlier received, (i) if sent by certified or registered mail,
return receipt requested, when actually received, (ii) if sent by overnight mail or courier, when
actually received, (iii) if sent by facsimile transmission, on the date sent, and (iv) if delivered
by hand, on the date of receipt.

	 	 	 
	If to Tyson, to:

	 	Tyson Foods, Inc.

2210 West Oaklawn Drive

Springdale, Arkansas 72762

Fax No.: (479) 290-7967

Attention: Executive Vice President, General Counsel

 

 

 

	 	 	 
	If to Syntroleum, to:

	 	Syntroleum Corporation

4322 South 49th West Avenue

Tulsa, Oklahoma 74107

Fax No.: (918) 592-7979

Attention: President

5.5 Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York, excluding any conflict-of-laws rule or principle that might
refer the construction or interpretation of this Agreement to the laws of another State.

5.6 Arbitration; Jurisdiction; Venue. All disputes arising out of or related to this
Agreement and not resolved within fifteen (15) days after the occurrence thereof shall be
determined by arbitration administered by the AAA in accordance with its Commercial Arbitration
Rules (the “Rules”). Any such arbitration shall be conducted in Houston, Texas in the English
language. The arbitration panel shall consist of three neutral arbitrators. The arbitrators shall
be appointed as provided in Rule R-11. The chairman shall be selected in accordance with Rule R-13
of the Rules. Any action or proceeding required to enforce or enter an arbitration award or
decision will be brought and enforced in the courts of the United States for the Southern District
of New York, and the parties irrevocably submit to the exclusive jurisdiction of the foregoing
courts in respect of any such action or proceeding. The parties irrevocably waive, to the fullest
extent permitted by law, any objection that they may now or hereafter have to the laying of venue
of any such action or proceeding in the United States District Court for the Southern District of
New York, and any claim that any such action or proceeding brought in any such court has been
brought in an inconvenient forum.

5.7 Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of each Party’s respective successors and assigns. This Agreement and the rights and
obligations hereunder may not be assigned by either Party to any other Person without the prior
written consent of the other Party not to be unreasonably withheld, conditioned or delayed.
Notwithstanding the preceding, Tyson may assign this Agreement and its right and obligations
hereunder to a wholly owned Affiliate of Tyson.

5.8 Counterparts. This Agreement may be executed in one or more counterparts, all of
which shall constitute one and the same instrument.

5.9 Interpretation. Wherever from the context it appears appropriate, each term
stated in either the singular or the plural shall include the singular and the plural, and pronouns
stated in either the masculine or the neuter gender shall include the masculine, the feminine and
the neuter. All references to Articles and Sections refer to articles and sections of this
Agreement, and all references to Schedules and Exhibits are to Schedules and Exhibits attached to
this Agreement, each of which is made a part hereof for all purposes. The terms “include” and
“including” means include or including without limitation. A reference to an agreement or
instrument is to the agreement or instrument as amended or modified from time to time in accordance
with its terms. The Parties acknowledge and agree that this Agreement has been negotiated by the
Parties and has been the subject of arm’s length and careful negotiation, that each Party has been
given the opportunity to independently review this Agreement with legal counsel, and that each
Party has the requisite experience and sophistication to understand,
interpret and agree to the particular language of the provisions hereof. Accordingly, in the
event of an ambiguity in or dispute regarding the interpretation of this Agreement, this Agreement
shall not be interpreted or construed against a Party which drafted the Agreement or any portion
thereof.

 

 

 

5.10 Headings. The section headings in this Agreement are for convenience of
reference only, and shall not be deemed to alter or affect the meaning or interpretation of any
provisions hereof.

5.11 Confidentiality: Publicity.

(a) The Parties agree that each shall keep confidential and cause its Affiliates and
instruct its officers, directors, employees and advisors to keep confidential, all
information relating to the terms and conditions of this Agreement (collectively,
“Confidential Information”). Notwithstanding the foregoing, a Party may disclose
Confidential Information to the extent such disclosure is (i) required by law,
administrative process or any standards or rules of any stock exchange to which such Party
or any of its Affiliates is subject, (ii) to the advisors, auditors, legal counsel, agents,
lenders and insurers of such party or its affiliates (collectively, “Recipients”) provided
that such disclosure is necessary for each Recipients to perform their respective
obligations on behalf of such Party with respect to this Agreement and a Party shall be
liable for any breach of such confidentiality obligations by it Recipients, (iii) of
information already known by a Party prior to disclosure by the other Party or which is
available to the public as of the date hereof, or thereafter becomes available to the public
other than as a result of a breach of this Section 5.11, (iv) of information obtained from
another source not subject to confidentiality obligation or (v) of information independently
developed by a Party’s employees not privy to the other Party’s information.

(b) In furtherance of the foregoing, if any Party is or becomes compelled by any
governmental, judicial or regulatory authority with jurisdiction to disclose this Agreement
to any third party (e.g., by order, deposition, interrogatory, civil investigative demand,
request for documents, subpoena, or similar process or rule of procedure, or by statute,
rule, or regulation, or other legal requirement), such Party shall give the other Party
prompt notice of the existence, terms and circumstances surrounding such requirement.

(c) The obligation of the Parties under this Section 5.11 shall survive the expiration
or termination of this Agreement for a period of two (2) years.

 

 

 

(d) Each Party shall have the right to review and approve any publicity material, press
releases, or other public statements by the other Party that refer to such Party or that
describe any aspect of this Agreement. Each Party agrees not to issue any such publicity
materials, press releases, or public statements without the prior written approval of the
other Party, except as is required to comply with federal or state securities laws or the
rules of any securities exchange to which a Party is subject. No Party shall publish or use
any advertising, sales promotions, or other publicity materials that use any other Party’s logo, trademarks, or service marks without the prior written approval of
such other Party.

(Signatures on following page)

 

 

 

IN WITNESS WHEREOF, each Party has executed this Agreement in counterparts as of the date
first above written.

	 	 	 	 	 
	 	SYNTROLEUM CORPORATION

 	 
	 	By:  	/s/ John B. Holmes, Jr.
 	 
	 	 	Name:  	John B. Holmes, Jr. 	 
	 	 	Title:  	Chief Executive Officer 	 
	 
	 	TYSON FOODS, INC.

 	 
	 	By:  	/s/ Richard L. Bond
 	 
	 	 	Name:  	Richard L. Bond 	 
	 	 	Title:  	President and Chief Executive OfficerFiled by Bowne Pure Compliance

 

Exhibit 10.7

CONSULTING AGREEMENT

THIS CONSULTING AGREEMENT (the “Agreement”) is made effective this 8th day of August, 2007, between
Randolph K. Geissler, whose address is 410 Brookwood Dr., Hudson, WI 54016, (the “Consultant”),
and VeriChip Corporation, a Delaware corporation, whose principal place of business is located at
1690 South Congress Avenue, Suite 200, Delray Beach, Florida 33445 (the “Company”).

WHEREAS, the Company is in need of assistance in connection with identifying business opportunities
with respect to growing the Company;

WHEREAS, the Consultant possesses considerable industry knowledge and experience that is valuable
to the Company; and

WHEREAS, the Consultant has agreed to perform consulting work for the Company with respect to
identifying, contacting, and introducing potential strategic partners to the Company, identifying
potential medical device merger and/or acquisition opportunities for the Company to consider, and
participating on a committee established to develop the glucose sensing chip (collectively, the
“Services”).

NOW, THEREFORE, the parties hereby agree as follows:

ARTICLE 1 — SCOPE OF WORK.

1.1 Services — The Company shall engage the Consultant to provide the Services related to the
human implantable RFID business on the terms and conditions that follow.

1.2 Time and Availability — The Consultant shall perform the Services and provide advice and
analysis with respect to the Services as the Company may reasonably require. The Services shall be
performed at such place or places as the Consultant deems reasonable giving due regard to the needs
of the Company’s business. Consultant shall devote such of his time and business efforts to the
performance of the Services as Consultant deems reasonable and necessary to discharge his
responsibilities and obligations hereunder.

1.3 Confidentiality — In order for the Consultant to perform the Services, it may be necessary
for the Company to provide the Consultant with Confidential Information (as defined below)
regarding the Company’s business and products. The Consultant agrees to be bound by the terms of
Article 5 hereof.

1.4 Standard of Conduct — In rendering the Services under this Agreement, the Consultant shall
conform to high professional standards of work and business ethics. The Consultant shall not use
time, materials, or equipment of the Company without the prior written consent of the Company.

 

 

 

1.5 Outside Services — The Consultant shall not use the service of any other person, entity or
organization in the performance of the Consultant’s duties without the prior written consent of the
Company. Should the Company consent to the use by the
Consultant of the services of any other person, entity or organization, no information regarding
the Services to be performed under this Agreement shall be disclosed to that person, entity or
organization until such person, entity or organization has executed an agreement to protect the
confidentiality of the Company’s Confidential Information (as defined below) and the Company’s
absolute and complete ownership of all right, title and interest in the work performed under this
Agreement.

1.6 Reports — The Consultant shall, periodically and when specifically requested by the Company,
provide the Company with written reports of his observations and conclusions regarding the
Services. Upon the termination of this Agreement, the Consultant shall, upon the request of
Company, prepare a final report of the Consultant’s activities.

ARTICLE 2 — INDEPENDENT CONTRACTOR.

2.1 Independent Contractor — The Consultant is an independent contractor and is not an employee,
partner, or co-venturer of, or in any other service relationship with, the Company. The Consultant
is not authorized to speak for, represent, or obligate the Company in any manner without the prior
express written authorization from an officer of the Company.

2.2 Defense and Indemnification

(a) The Company agrees, at its sole expense, to defend the Consultant against, and to
indemnify and hold the Consultant harmless from, any claims or suits by a third party against the
Consultant’s acts or omissions or any liabilities or judgments based thereon, arising form the
Consultant’s performance of the Services at the Company’s direction under this Agreement.

(b) The Consultant agrees to indemnify, defend and hold harmless the Company, its directors,
officers, employees and agents with respect to claim, demand, cause of action, debt or liability,
including reasonable attorneys’ fees, to the extent that such an action arises out of the
negligence or misconduct of the Consultant.

2.3 Taxes — The Consultant shall be responsible for all taxes arising from compensation as per
Section 3.1 below under this Agreement, and shall be responsible for all payroll taxes and fringe
benefits of the Consultant’s employees. Neither federal, nor state, nor local income tax, nor
payroll tax of any kind, shall be withheld or paid by the Company on behalf of the Consultant or
its employees. The Consultant understands that it is required to pay, according to law, the
Consultant’s taxes and the Consultant shall, when requested by the Company, properly document to
the Company that any and all federal and state taxes have been paid. All reimbursements as per
Section 3.2 are not and shall not be reported to the IRS as taxable income.

2.4 Benefits — The Consultant and the Consultant’s employees will not be eligible for, and shall
not participate in, any employee pension, health, welfare, or other fringe benefit plan, of the
Company. No workers’ compensation insurance shall be obtained by the Company covering the
Consultant or the Consultant’s employees.

 

2

 

ARTICLE 3 — COMPENSATION FOR CONSULTING SERVICES.

3.1 Compensation — In consideration of Consultant performing the Services, the Consultant shall
be granted 107,000 (one hundred seven thousand) shares of the Company’s common stock (the “Shares”)
pursuant to any combination of the Company’s 2005 Flexible Stock Plan and/or the 2007 Stock
Incentive Plan, at the Company’s discretion. The Company shall issue the Shares to the Consultant
as soon as administratively practicable following the effective date of this Agreement. The
Consultant shall not be entitled to any other compensation by the Company for any services rendered
by the Consultant without the express written approval of the Company.

3.2 Reimbursement — The Company agrees to reimburse the Consultant for all actual reasonable and
necessary expenditures, which are directly related to the Services. Expenses will only be
reimbursed if the Company had given prior approval of the expenditure. Expenses incurred by the
Consultant will be reimbursed by the Company within thirty (30) days of the Consultant’s proper
written request for reimbursement which includes all proper documentation.

ARTICLE 4 — TERM AND TERMINATION.

4.1 Term — This Agreement shall be effective as of August 6, 2007, and shall continue in full
force and effect for 12 consecutive months. The Company and the Consultant may negotiate to extend
the term of this Agreement and the terms and conditions under which the relationship shall
continue. The Company may cancel this agreement on thirty (30) days notice to Consultant, as per
section 9.9 below.

4.2 Termination — The Company may immediately terminate this Agreement for “Cause,” after giving
the Consultant written notice of the reason. Cause means: (1) the Consultant has breached the
provisions of Article 5 or 7 of this Agreement in any respect; (2) the Consultant has breached any
other provision of this Agreement and the breach continues for 15 days following receipt of a
notice from the Company; (3) the Consultant has committed fraud, a misappropriation or embezzlement
in connection with the Company’ s business or the Consultant’s Services; (4) the Consultant has
been convicted of a felony, or (5) the Consultant’s use of narcotics, liquor or illicit drugs has a
detrimental effect on the performance of her employment responsibilities, as determined by the
Company.

4.3 Responsibility upon Termination — Any equipment provided by the Company to the Consultant in
connection with or furtherance of Consultant’s Services under this Agreement, including, but not
limited to, computers, laptops, and personal management tools, shall, immediately upon the
termination of this Agreement, be returned to the Company.

4.4 Survival — The provisions of Articles 5, 6, 7 and 8 of this Agreement shall survive the
termination of this Agreement and remain in full force and effect thereafter.

 

3

 

ARTICLE 5 — CONFIDENTIAL INFORMATION.

5.1 Obligation of Confidentiality — In performing the Services under this Agreement, the
Consultant may be exposed to and will be required to use certain “Confidential Information” (as
hereinafter defined) of the Company. The Consultant agrees that the Consultant will not and the
Consultant’s employees, agents or representatives will not, use, directly or indirectly, such
Confidential Information for any purpose other than providing the Services and will not use for the
benefit of any person, entity or organization other than the Company, or disclose such Confidential
Information without the written authorization of the Company, either during or after the term of
this Agreement, for as long as such information retains the characteristics of Confidential
Information.

5.2 Definition — “Confidential Information” means information, not generally known, and
proprietary to the Company or to a third party for whom the Company is performing work, including,
without limitation, information concerning any patents or trade secrets, confidential or secret
designs, processes, formulae, source codes, plans, devices or material, research and development,
proprietary software, analysis, techniques, materials or designs (whether or not patented or
patentable), directly or indirectly useful in any aspect of the business of the Company, any vendor
names, customer and supplier lists, databases, management systems and sales and marketing plans of
the Company, any confidential secret development or research work of the Company, or any other
confidential information or proprietary aspects of the business of the Company. All information
which Consultant acquires or becomes acquainted with during the period of this Agreement, whether
developed by Consultant or by others, which Consultant has a reasonable basis to believe to be
Confidential Information, or which is treated by the Company as being Confidential Information,
shall be presumed to be Confidential Information. Confidential Information does not include
information that (i) is or later becomes available to the public through no breach of this
Agreement by the recipient; (ii) is obtained by the recipient from a third party who had the legal
right to disclose the information to the recipient; (iii) is already in the possession of the
recipient on the date this Agreement becomes effective; or (iv) is required to be disclosed by law,
government regulation, or court order.

5.3 Property of the Company — The Consultant agrees that all plans, manuals and specific
materials developed by the Consultant on behalf of the Company in connection with the Services
rendered under this Agreement, are and shall remain the exclusive property of the Company.
Promptly upon the expiration or termination of this Agreement, or upon the request of the Company,
the Consultant shall return to the Company all documents and tangible items, including samples,
provided to Consultant or created by Consultant for use in connection with services to be rendered
hereunder, including without limitation all Confidential Information, together with all copies and
abstracts thereof. This clause shall not apply to services performed by the President of the
Consultant related to Receptors LLC. In the event of a conflict, property developed that is
related to an agreement with Receptors LLC shall be governed first by any agreement between the
Company and Receptors LLC, and if no such agreement exists, by this Agreement.

 

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5.4 Intellectual Property — Title to all inventions and discoveries made by the Consultant
resulting from the work performed hereunder shall reside in the Company as related to the human
RFID implantable products and business; title to all inventions and discoveries made by the Company
resulting from the research performed hereunder shall reside in the Company; title to all
inventions and discoveries made jointly by the Consultant and Company resulting from the
consultancy hereunder shall reside with the Company solely. The Consultant reserves the right to
give notice to the Company and use, apply and profit from the above if the Company elects not to
use or put into practice or outside the store fixture industry. Title to all inventions and
discoveries made by the Consultant prior to this agreement shall reside with the Consultant.

ARTICLE 6 —DATA.

6.1 Data — All drawings, models, designs, formulas, methods, documents and tangible items
prepared for and submitted to the Company by the Consultant in connection with the services
rendered under this Agreement shall belong exclusively to the Company and shall be deemed to be
works made for hire (the “Deliverable Items”). To the extent that any of the Deliverable Items may
not, by operation of law, be works made for hire, the Consultant hereby assigns to the Company the
ownership of copyright or mask work in the Deliverable Items, and the Company shall have the right
to obtain and hold in its own name any trademark, copyright, or mask work registration, and any
other registrations and similar protection which may be available in the Deliverable Items. The
Consultant agrees to give the Company or its designees all assistance reasonably required to
perfect such rights.

ARTICLE 7 — CONFLICT OF INTEREST AND NON— SOLICITATION.

7.1 Conflict of Interest — The Consultant covenants and agrees not to consult or provide any
services in any manner or capacity to a direct competitor of the Company during the duration of
this Agreement unless express written authorization to do so is given by the Company. A direct
competitor of the Company for purposes of this Agreement is defined as any individual, partnership,
corporation and/or other business entity that engages in the business of the Company.

7.2 Non-Solicitation — The Consultant covenants and agrees that during the term of this
Agreement, the Consultant will not, directly or indirectly, through an existing corporation,
unincorporated business, affiliated party, successor employer, or otherwise, solicit, hire for
employment or work with, on a part-time, consulting, advising or any other basis, other than on
behalf of the Company, any customer or client of, or any employee or independent contractor
employed by, the Company while the Consultant is performing the Services for the Company.

 

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ARTICLE 8 — RIGHT TO INJUNCTIVE RELIEF.

The Consultant acknowledges that the terms of Articles 5, 6, and 7 of this Agreement are reasonably
necessary to protect the legitimate interests of the Company, are reasonable in scope and duration,
and are not unduly restrictive. The Consultant further acknowledges
that a breach of any of the terms of Articles 5, 6, or 7 of this Agreement will render irreparable
harm to the Company, and that a remedy at law for breach of the Agreement is inadequate, and that
the Company shall therefore be entitled to seek any and all equitable relief, including, but not
limited to, injunctive relief, and to any other remedy that may be available under any applicable
law or agreement between the parties. The Consultant acknowledges that an award of damages to the
Company does not preclude a court from ordering injunctive relief. Both damages and injunctive
relief shall be proper modes of relief and are not to be considered as alternative remedies.

ARTICLE 9 — GENERAL PROVISIONS.

9.1 Construction of Terms — If any provision of this Agreement is held unenforceable by a court
of competent jurisdiction, that provision shall be severed and shall not affect the validity or
enforceability of the remaining provisions.

9.2 Governing Law — This Agreement shall be governed by and construed in accordance with the
internal laws (and not the laws of conflicts) of the State of Florida.

9.3 Complete Agreement — This Agreement constitutes the complete agreement and sets forth the
entire understanding and agreement of the parties as to the subject matter of this Agreement and
supersedes all prior discussions and understandings in respect to the subject of this Agreement,
whether written or oral.

9.4 Jurisdiction and Venue — The parties acknowledge that all of the negotiations, anticipated
performance and execution of this Agreement occurred or shall occur in the State of Florida, and
that, therefore, without limiting the jurisdiction or venue of any other federal or state courts,
each of the parties irrevocably and unconditionally (a) agrees that any suit, action or legal
proceeding arising out of or relating to this Agreement may be brought in the state or federal
courts of record of the State of Florida in Palm Beach County; (b) consents to the jurisdiction of
each such court in any suit, action or proceeding; (c) waives any objection which it may have to
the laying of venue of any such suit, action or proceeding in any of such courts; and (d) agrees
that service of any court paper may be effected on such party by mail, as provided in this
Agreement, or in such other manner as may be provided under applicable laws or court rules in said
state.

9.5 Modification — No modification, termination or attempted waiver of this Agreement, or any
provision thereof, shall be valid unless in writing signed by the party against whom the same is
sought to be enforced.

9.6 Waiver of Breach — The waiver by a party of a breach of any provision of this Agreement by
the other party shall not operate or be construed as a waiver of any other or subsequent breach by
the party in breach.

 

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9.7 Successors and Assigns — This Agreement may not be assigned by either party without the prior
written consent of the other party; provided, however, that the Agreement shall be assignable by
the Company without the Consultant’s consent in the event the Company is acquired by or merged into
another corporation or business entity.

The benefits and obligations of this Agreement shall be binding upon and inure to the parties
hereto, their successors and assigns.

9.8 No Conflict — The Consultant warrants that the Consultant has not previously assumed any
obligations inconsistent with those undertaken by the Consultant under this Agreement.

9.9 Notices — Any notice required or permitted by this Agreement shall be in writing and shall be
deemed sufficient upon delivery, when delivered personally or by overnight courier or sent by fax
(upon customary confirmation of receipt), or 48 hours after being deposited in the U.S. mail, as
certified or registered mail, with postage prepaid, addressed to the party to be notified at such
party’s address as set forth above.

9.10 Counterparts. This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original and all of which together shall constitute one instrument. Delivery of
an executed counterpart of this Agreement via facsimile transmission shall be effective as delivery
of a manually executed counterpart of this Agreement.

IN WITNESS WHEREOF, this Agreement is executed as of the date set forth above.

VeriChip Corporation

By: /s/ William J. Caragol                    

Name: William J. Caragol

Title: President and Chief Financial Officer

/s/ Randolph K. Geissler                    

Randolph K. Geissler

 

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