EXHIBIT 10.22
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SERVICES AGREEMENT
THIS AGREEMENT, dated as of June 1, 2000, is by and between ISOLYSER
COMPANY, INC., a Georgia corporation ("Isolyser"), and GLOBAL RESOURCES, INC., a
Georgia corporation ("GRI").
RECITALS:
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R-1. Isolyser intends to outsource to GRI certain services previously
provided within Isolyser which are described below.
R-2. GRI intends to organize a wholly-owned subsidiary under China law for
purposes of carrying on certain business operations in China.
NOW, THEREFORE, Isolyser and GRI agree as follows:
1. Services.
(a) GRI will provide Isolyser with supply chain management services
addressing the sourcing of polyvinyl alcohol fiber and manufacturing and
shipping of products by contract manufacturers of Isolyser located in China
including without limitation providing the services more fully described on
Exhibit "A" attached hereto and incorporated herein by reference.
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(b) As often as reasonably requested by Isolyser, GRI will provide
status reports to management of Isolyser concerning matters within the purview
of the services provided by GRI under this Agreement. Without limiting the
foregoing, GRI will provide monthly status reports on all active projects to an
individual designated by Isolyser and cause all appropriate employees of GRI as
may be reasonably requested by Isolyser to participate in meetings at the
offices of Isolyser held not less frequently than quarterly to review business
operations.
(c) In performing its duties hereunder, GRI will act faithfully and
to the best of its abilities in a manner intended to advance Isolyser's
interests. GRI has advised Isolyser that GRI intends to provide supply chain
management and other services to third parties which may include, without
limitation, arranging contracts with Isolyser suppliers and manufacturers for
supply and manufacturing services for third parties, subject to compliance at
all times with the covenants contained in Section 3 of this Agreement and this
Section. GRI will exercise best efforts to ensure that Isolyser has top priority
when it comes to services from GRI. GRI will not conduct any business with
Xinhua nonwovens (Hangzhou Xinhua Group Corporation, a company organized under
China law and located in Hangzhou City, Zhejiang Province, China, and its
successors) other than for the benefit of Isolyser without the prior permission
of the President of Isolyser or his designee.
(d) In addition to the services set forth on Exhibit "A" attached
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hereto, Isolyser and GRI may agree upon additional assignments to be undertaken
by GRI and any additional compensation which the parties deem appropriate for
such additional services.
2. Fee for Services.
(a) For the respective periods set forth below, Isolyser shall pay
GRI monthly in advance the monthly fee set forth below:
Year Monthly Fee
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June 1, 2000 to May 31, 2001 $25,000
June 1, 2001 to May 31, 2003 $21,250
(b) In addition to such monthly fee, until May 31, 2001 and provided
such persons remain employees in good standing of Isolyser and no default by GRI
shall have occurred under this Agreement, Isolyser shall make available to GRI
the full time services of Marty Paugh and Sally Cheng at the expense (including
salary, payroll taxes and employee benefits) of Isolyser, and Isolyser shall
make available to GRI the full time services of Ming Tang and Michael Dai at the
expense (including salary, payroll taxes and employee benefits) of Isolyser
except that Isolyser may offset the salary and payroll taxes for Messrs. Tang
and Dai from the monthly fee set forth in Section 2(a). After May 31, 2001, GRI
shall be required to continue the services of the above employees or other
personnel reasonably satisfactory to Isolyser at the sole cost and expense of
GRI.
(c) Isolyser shall provide to GRI accounting/bookkeeping services,
human resources consulting and general office services at a fee not greater than
Isolyser's cost so long as Isolyser and GRI share common office facilities. At
any time upon sixty (60) days advance written notice to GRI, Isolyser may cease
sharing with GRI its office facilities.
3. Covenants of GRI. The covenants set forth in this section are a
material inducement to Isolyser to enter into this Agreement.
(a) As used herein, "Confidential Information" means information or
knowledge which (i) is used or is developed to be used in the business of
Isolyser, or results from the research or development activities of Isolyser or
any of its customers or suppliers, (ii) is private or confidential and is not
generally known or available to the public, and (iii) gives Isolyser or any of
its customers or suppliers an opportunity to obtain an advantage over their
respective competitors who do not know or use such information. Confidential
Information includes technical information, design, know-how, shop practices,
identification of suppliers or customers, pricing or other financial
information, and any other information which Isolyser takes reasonable efforts
to protect from disclosure and from which Isolyser derives actual or potential
economic value due to its confidential nature. GRI agrees that it shall not and
shall not permit any of its employees to disclose to any person or utilize for
its own benefit any Confidential Information. On termination of this Agreement,
GRI shall deliver to Isolyser all copies of writings or other data or media
containing Confidential Information.
(b) GRI agrees not to directly or indirectly (i) solicit Isolyser
employees to leave Isolyser or (ii) hire any Isolyser employees during the term
of this Agreement and for a
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period of two (2) years following the termination of this Agreement unless
otherwise agreed by Isolyser. This paragraph shall not prevent GRI from hiring
Marty Paugh, Sally Cheng, Ming Tang or Michael Dai.
(c) GRI will treat as belonging solely and exclusively to Isolyser
and will fully and promptly disclose and assign to Isolyser without additional
payment all ideas, discoveries, inventions, contributions, and improvements
(whether or not patentable or copyrightable) which in any way relate to
Isolyser's business or which result from tasks assigned by Isolyser to GRI or
any employee of GRI and which are conceived or reduced to practice by GRI or its
employees, alone or with others. GRI, at Isolyser's expense at any time during
or after the term of this Agreement, will sign all papers and do such other acts
and things as Isolyser may reasonably require of GRI to protect Isolyser's
rights to such ideas, discoveries, inventions, contributions and improvements
including, without limitation, applying for, obtaining and enforcing U.S. and
foreign patents and copyrights.
(d) During the term of this Agreement and until the second
anniversary of the date of termination of this Agreement, GRI shall not anywhere
in the world engage in the business of or render services to others with respect
to developing, manufacturing, or selling equipment drapes or equipment covers,
materials (including, without limitation, woven and nonwoven fabrics, films or
thermoformed or extruded items) manufactured from polyvinyl alcohol or any novel
degradable polymers used by Isolyser or products directly or indirectly
competitive with Isolyser's Liquid Treatment System or Sharp Management System.
(e) In addition to any other rights and remedies which are available
to Isolyser with respect to any breach or violation of the protective covenants
set forth herein, it is recognized and agreed that Isolyser shall be entitled to
obtain injunctive relief which would prohibit GRI from continuing any breach or
violation of such protective covenants.
4. Term.
(a) The term of this Agreement shall be for three years, commencing
on June 1, 2000, and expiring on May 31, 2003. Isolyser and GRI may agree to
extend the term of this Agreement. This Agreement may be earlier terminated as
set forth in this Section 4.
(b) This Agreement shall be subject to early termination as follows:
(i) In the event of the breach by one party of any of the
material terms or provisions of this Agreement which breach is not cured within
thirty days following written notice by the non-breaching party to the breaching
party, this Agreement may be terminated upon notice by the non-breaching party
to the breaching party;
(ii) This Agreement may be terminated immediately upon notice by
Isolyser to GRI upon and in the event of (A) a breach by GRI of any of the
covenants contained in Section 3 of this Agreement, or (B) the failure to pay
when due any amount owing under that certain promissory note in the principal
face amount of $200,000 dated June 1, 2000 made by GRI and payable to Isolyser
which failure is not cured within ten (10) days after notice to GRI; or
(iii) This Agreement may be terminated by Isolyser in the event
(A) the quality of services provided by GRI to Isolyser are not reasonably
satisfactory to Isolyser and
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GRI fails to satisfy the reasonable requests of Isolyser to improve the quality
of such services within ninety (90) days after notifying GRI of any issues with
respect to such services, or (B) in the event any one or more of the following
persons fail to control GRI: Isolyser, Mike Mabry, Ming Tang, Marty Paugh, and
Gene McGrevin.
(c) Upon the expiration or earlier termination of this Agreement, GRI
shall undertake commercially reasonable efforts and shall cooperate with
Isolyser to facilitate the transition to Isolyser of services previously
provided to Isolyser by GRI.
5. Employment Agreement. Isolyser and Mike Mabry are parties to an
employment agreement dated March 31, 1998, under which Mr. Mabry agreed to work
for Isolyser on a full time basis and agreed to certain covenants in favor of
Isolyser. Isolyser agrees to modify the obligations of Mr. Mabry under such
employment agreement to the extent necessary for Mr. Mabry to perform his
obligations as an officer of GRI in order that GRI may in turn perform its
obligations under this Agreement. At such time as Mr. Mabry becomes required to
devote a significant portion of his working time to his duties as an officer of
GRI, Mr. Mabry agrees to act in good faith to negotiate a downard adjustment in
his minimum salary under such employment agreement.
6. Miscellaneous. This Agreement is solely for the benefit of Isolyser
and GRI, and (except as provided in Section 5) there shall be no third party
beneficiary of this Agreement including management of GRI. This Agreement shall
be governed by Georgia law. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which shall
constitute one and the same agreement. Until such notice address may be changed
by notice to the other party, any notice required by this Agreement shall be
given to Isolyser at its principal place of business to the attention of its
president, and to GRI at the principal place of business of Isolyser to the
attention of GRI's president. Any notice shall be effective upon delivery to
such offices. This Agreement may not be transferred or assigned by GRI without
the written consent of Isolyser.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
ISOLYSER COMPANY, INC. GLOBAL RESOURCES, INC.
By: __________________________________ By:_______________________________
Name:_________________________________ Name:_____________________________
Title:________________________________ Title:____________________________
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