EXHIBIT 10.10
CONSULTANCY AGREEMENT
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CONSULTANCY AGREEMENT (the "Agreement") dated as of May 25, 2005 (the
"Effective Date"), by and between Pathogenics, Inc., a Delaware corporation (the
"Corporation"), having a place of business at 00 Xxxxx Xxxxxx, Xxxxx 000,
Xxxxxxx, XX 00000, and Xxxx X. Xxxxxx (the "Consultant"), an individual residing
at 0000 Xxxxxxxx Xxxxxx, Xxxxxx, XX 00000.
WHEREAS, the Corporation desires that it be able to call upon the
experience and knowledge of Consultant for consultation services and advice
concerning the use of any therapeutic use or formulation of Chloroquine and any
of its derivatives or analogs and the technical evaluation of commercial
applications of such technology; and,
WHEREAS, Consultant is willing to render such services to the Corporation
on the terms and conditions hereinafter set forth in this Agreement;
NOW, THEREFORE, in consideration of the promises and mutual covenants
contained herein and for other good and valuable consideration, the parties
hereto agree as follows:
1. Term and Termination of Agreement. Commencing on the Effective
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Date, Consultant shall be retained by the Corporation on a monthly basis for a
period of one (1) year, which shall be renewable upon written agreement of the
parties for additional one-year periods. The initial term and any extensions or
renewals thereof shall constitute the "Consulting Term." This Agreement may be
terminated by either party at any time upon one (1) month's prior written
notice.
2. Position and Responsibilities. Consultant hereby agrees to serve as
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a consultant to the Corporation and to render such advice and services to the
Corporation as may be reasonably required by the Corporation including, without
limitation, advising the Corporation with respect to the direction of the
Corporation's research and product development and business development
activities. During the Consulting Term, Consultant shall report directly to
Xxxxxxxx X. Xxxxx, President of the Corporation.
3. Compensation. The Corporation shall pay Consultant a monthly
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retainer of three-thousand dollars ($3,000/month) per month for Consultant's
first forty (40) hours of billable work each month, and an hourly rate of
seventy-five dollars per hour ($75/hr.) for each hour thereafter. Consultant
shall not exceed forty hours of billable work per month without first providing
the Corporation with a written estimate of the expected excess hours, and then
obtaining written pre-authorization from the Corporation. Consultant shall
provide the Corporation with a monthly invoice documenting Consultant's
activities and billable time, and Corporation shall pay this invoice upon
receipt (except as indicated herein below) if the amount is not in dispute. The
Corporation shall pay the Consultant the first month's retainer of $3,000 upon
receiving the Consultant's executed copy of this Agreement. Notwithstanding
anything to the contrary above, payment of the invoices following the execution
of this Agreement shall be deferred and accrued by the Corporation until such
time as the Corporation's stock registration statement is declared effective by
the US Securities and Exchange Commission, whereupon the Corporation shall pay
all the deferred and accrued invoices, and shall cease to defer and accrue any
future invoices.
4. Expenses. Consultant shall be reimbursed in accordance with the
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policies of the Corporation for necessary and reasonable pre-approved business
expenses incurred by Consultant in connection with their performance of his
duties hereunder. Consultant shall provide the Corporation with an invoice
documenting Consultant's reimbursable expenses, and Corporation shall pay this
invoice within thirty (30) days of receipt if the amount is not in dispute.
5. Confidentiality. Consultant recognizes and acknowledges that, in
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the course of his duties, Consultant may receive confidential or proprietary
information owned by the Corporation or other third parties with whom the
Corporation has an obligation of confidentiality. Therefore, during and after
the Consulting Term, Consultant agrees to keep confidential and not disclose or
use (except in connection with the fulfillment of his consulting duties to the
Corporation under this Agreement) all confidential or proprietary information
owned by or receive by or on behalf of the Corporation. "Confidential
Information" shall include, but shall not be limited to, confidential or
proprietary scientific or technical information customers, development programs,
costs, marketing, trading, investment, sales activities, promotion, credit and
financial data, manufacturing processes, financing methods, plans or the
business and affairs of the Corporation generally, or of any subsidiary or
affiliate of the Corporation. "Confidential Information" shall not include,
however, information in the public domain, information disclosed to Consultant
by a third party entitled to disclose it without obligation of confidentiality
or information already known to Consultant prior to its receipt.
6. Non-Solicitation. During the Consulting Term and for a period of
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one year thereafter, Consultant shall not directly or indirectly employ, solicit
for employment or advise or recommend to any other person that they employ or
solicit for employment any person whom he knows to be an employee of the
Corporation or any parent, subsidiary or affiliate of the Corporation.
7. Ownership of Work Product and Inventions. In consideration of the
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compensation paid to the Consultant by the Corporation in paragraph 3 of this
Agreement, Consultant hereby assigns to the Corporation all his right, title and
interest in all Consultant's work product and inventions, including any and all
data, plans, reports and recommendations, as well as any inventions or
improvements, conceived or made individually or jointly with others while
performing consulting activities under this Agreement, relating to any work
within the scope of this Agreement and/or relating to the business of and/or
resulting from Consultant's services upon behalf of the Corporation ("Work
Product and Inventions") shall be considered as work made for hire, made and
held by Consultant in a fiduciary capacity for the exclusive benefit of the
Corporation. Work Product and Inventions shall be the sole and exclusive
property of the Corporation and shall not be disclosed to any other party
without the prior written approval of the Corporation and such Work Product and
Inventions shall be considered Confidential subject to section 5 above.
Consultant shall promptly and disclose fully to the Corporation or its
designated agent, but to no other person, any and all inventions, improvements,
formulas, processes and the like (also "Inventions"), arising while performing
consulting activities under this Agreement. When requested by the Corporation,
either during or subsequent to the term of this Agreement, Consultant shall
assist the Corporation and its agents in the preparation, filing and prosecution
of patent applications, covering such inventions, and in the enforcement or
defense of any patent which may issue therefrom. Consultant shall assign,
transfer, and set over unto the Corporation his entire right, title and interest
in and to any and all Work Product and Inventions, as well as any patent
application(s) relating to such Work Product and Inventions that arise from his
consulting activities for the Corporation hereunder. Consultant agrees to
cooperate fully in the prosecution of any patent applications resulting from any
such invention, at the expense of the Corporation, which cooperation shall
include executing any necessary documents in connection therewith. The filing
of all such applications, as well as the issuance and maintenance of patent
therefrom, shall be at the sole discretion of the Corporation.
8. Specific Performance. Consultant acknowledges and agrees that the
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Corporation's remedies at law for a breach or threatened breach of an of the
provisions of paragraph 5 through 7 of this Agreement would be inadequate and,
in recognition of this fact, Consultant agrees that, in the event of such a
breach or threatened breach, in addition to any remedies at law, the Corporation
shall be entitled to obtain equitable relief in the form of specific
performance, temporary restraining order, temporary or permanent injunction or
any equitable remedy which may then be available.
9. Representation of Consultant: Use of Name. Consultant hereby
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represents that his current principal place(s) of employment has received
disclosure as to the duties required of Consultant under this Agreement and that
such employer(s) consents fully to Consultant's execution of this Agreement and
the obligations under this Agreement. Consultant further represents that there
are no binding agreements to which he is a party or by which he is bound
forbidding or restricting his activities herein. In addition, Consultant
consents to the use of his name in various reports, brochures or other documents
produced by or on behalf of the Corporation, including any and all documents
filed with the Securities and Exchange Commission.
10. Consultant Not an Employee. The Corporation and Consultant hereby
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acknowledge and agree that Consultant shall perform the services hereunder as an
independent contractor and not as an employee of the Corporation. Consultant
agrees that he will file his own tax returns on the basis of his status as an
independent contractor for the reporting of all income, social security,
employment and other taxes due and owing on the consideration received by him
under this Agreement and that he is responsible for the payment of such taxes.
Similarly, Consultant shall not be entitled to benefits specifically associated
with employment status, such as medical, dental and life insurance, stock or
stock options of the Corporation (except as specifically provided in this
Agreement) and shall not be entitled to participate in any other employer
benefit programs. As an independent contractor, Consultant acknowledges,
understands and agrees that he is not, and shall not represent himself to third
parties as being, the agent or representative of the Corporation nor does he
have, and shall not represent himself to third parties as having, power or
authority to do or take any action for or on behalf of the Corporation, as its
agent, representative or otherwise, except as specifically set forth herein.
Consultant agrees to defend, indemnify and hold the Corporation harmless from
any and all claims made by any entity on account of an alleged failure by
Consultant to satisfy any tax or withholding obligations.
11. Representation and Warranty. Consultant represents and warrants to
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the Corporation that all services and advice offered to the Corporation are
provided based on best efforts and a good faith belief of the veracity of such
services and advice. Given such representations and warranties the Corporation
agrees to not hold Consultant liable for any errors, omissions or consequential
damages that may occur as a result of Consultant's services provided hereunder.
12. Limitation of Liability. Corporation acknowledges that it has
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substantial knowledge, experience and expertise with respect to the matters as
to which Consultant will provide consulting services and that it is able to and
will independently evaluate any advice rendered by Consultant to Corporation in
the performance of its duties hereunder. Therefore, Corporation agrees that
neither Consultant nor any of its officers, directors, shareholders or
affiliates shall have any liability whatsoever for any advice rendered to
Corporation under this Agreement. Corporation's sole remedy for Consultant's
failure to perform under the terms of this Agreement shall be to terminate this
Agreement in accordance with the terms of Section 1 herein.
13. Indemnification. Corporation shall indemnify and hold Consultant
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harmless from any claim, suit, loss, liability damage or expense (including
attorney's reasonable fees) arising from Consultant's service hereunder,
including any losses arising from the use by Corporation of any advice given by
Consultant. Consultant shall indemnify and hold Corporation harmless from any
losses arising from negligence or wrongful or intentionally willful misconduct
or omissions of Consultant.
14. Consulting for Third Parties. The Corporation recognizes that
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Consultant may, from time to time during the term of this Agreement and at his
sole discretion, provide consulting services to other parties. Consultant
agrees to notify the Corporation in such case and to provide information to the
Corporation as reasonably necessary to demonstrate that such consulting services
do not compete with the business of the Corporation. The Corporation also
agrees to permit Consultant to notify other parties with information about this
Agreement as reasonably necessary to demonstrate that such consulting services
do not compete with the business of the Corporation.
15. Miscellaneous,
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(a) Governing Law and Dispute Resolution. This Agreement shall be
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governed by and construed in accordance with the laws of the Commonwealth
of Massachusetts, without regard to principals of conflicts of laws.
Subject to the following, for purposes of this Agreement, each Party
consents, for itself and its Affiliates, to the jurisdiction of the courts
of the state of Illinois, county of Xxxx and the U.S. District Court for
Illinois.
i. The Corporation and the Consultant (the "Parties") agree to
attempt initially to solve all claims, disputes, or controversies
arising under, out of, or in connection with this Agreement (a
"Dispute") by conducting good faith negotiations. Any Disputes which
cannot be resolved by good faith negotiation within twenty (20)
Business Days, shall be referred, by written notice from either Party
to the other. The Parties shall negotiate in good faith to achieve a
resolution of the Dispute referred to them within twenty (20) Business
Days after such notice is received by the Party to whom the notice was
sent. If the Parties are unable to settle the Dispute between
themselves within twenty (20) Business Days, they shall so report to
the Parties in writing. The Dispute shall then be referred to
mediation as set forth in the following subsection (ii).
ii. Upon the Parties receiving the Parties' report that the
Dispute referred to them pursuant to subsection (i) has not been
resolved, the Dispute shall be referred to mediation by written notice
from either Party to the other. The mediation shall be conducted
pursuant to the Rules of the Commercial Arbitration of the American
Arbitration Association ("AAA") procedures. The place of the mediation
shall be in Chicago, IL. If the Parties have not reached a settlement
within twenty (20) Business Days of the date of the notice of
mediation, the Dispute shall be referred to arbitration pursuant to
subsection (iii) below.
iii. If after the procedures set forth in subsections (i) and
(ii) above, the Dispute has not been resolved, a Party shall decide to
institute arbitration proceedings, it shall give written notice to
that effect to the other Party. The Parties shall refrain from
instituting the arbitration proceedings for a period of sixty (60)
days following such notice. During such period, the Parties shall
continue to make good faith efforts to amicably resolve the dispute
without arbitration. If the Parties have not reached a settlement
during that period the arbitration proceedings shall go forward and be
governed by the AAA rules then in force. Each such arbitration shall
be conducted by a panel of three arbitrators: one arbitrator shall be
appointed by each of Corporation and Consultant and the third
arbitrator, who shall be the Chairman of the tribunal, shall be
appointed by the two Party-appointed arbitrators. The place of the
arbitration shall be in Chicago, IL.
The arbitrators shall have the authority to grant specific
performance. Judgment upon the award so rendered may be entered in any
court having jurisdiction or application may be made to such court for
judicial acceptance of any award and an order of enforcement, as the
case may be. In no event shall a demand for arbitration be made after
the date when institution of a legal or equitable proceeding based on
such claim, dispute or other matter in question would be barred by the
applicable statute of limitations. Each Party shall bear its own costs
and expenses incurred in connection with any arbitration proceeding
and the Parties shall equally share the cost of the mediation and
arbitration levied by the AAA.
Any mediation or arbitration proceeding entered into pursuant to
this Section shall be conducted in the English language.
(b) Entire Agreement. This Agreement, with the attached Statement of
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Work and Fees, contains the entire understanding of the parties with
respect to the retention of Consultant by the Corporation. There are no
restrictions, agreements, promises, warranties, covenants or undertaking
between the parties with respect to the subject matter herein other than
those expressly set forth herein. This Agreement may not be altered,
modified or amended except by written instrument signed by the parties
hereto.
(c) No Waiver. The failure of a party to insist upon strict adherence
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to any term of this Agreement on any occasion shall not be considered a
waiver of such party's rights or deprive such party of the right thereafter
to insist upon strict adherence to that term or any other term of this
Agreement.
(d) Severability. In the event that any one or more of the provisions
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of this Agreement shall be or become invalid, illegal or unenforceable in
any respect, the validity, legality and enforceability of the remaining
provisions of this Agreement shall not be affected thereby.
(e) Successor; Binding Agreement. This Agreement shall inure to the
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benefit of and be binding upon the parties hereto and their respective
heirs, representatives, successors and assigns. Consultant may not assign
this Agreement without the prior written consent of the corporation.
(f) Counterpart; Effectiveness. This Agreement may be signed in
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counterparts, each of which shall be an original, with the same effect as
if the signatures thereto and hereto were upon the same instrument.
(g) Survival of Termination. Paragraph 5 (only for three years after
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the termination of this Agreement), 6 (only for one year after the
termination of this Agreement), 7, 8, 9, 10, 11, 12, 13 and 15 shall
survive the termination of this Agreement.
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement
as of the date first above written.
PATHOGENICS, INC.
By /S/ Xxxxxxxx X. Xxxxx
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Xxxxxxxx X. Xxxxx, Esq.
President & CEO
XXXX X. XXXXXX.
By /S/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx
STATEMENT OF WORK & FEES
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Xxxx X. Xxxxxx
May 2005
CONSULTING DUTIES:
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Evaluate the therapeutic use or formulation of Chloroquine and any of its
derivatives or analogs and the technical evaluation of commercial applications
of such technology by:
- Assisting the Corporation's research and development of the technology;
- Assisting the Corporation's regulatory approval process of the technology;
- Identifying and drafting a detailed technical disclosure of any novel
therapeutic use or formulation of Chloroquine and any of its
derivatives or analogs;
- Evaluating the feasibility of the technical and commercial applications of
the technology;
- Assisting the Corporation's efforts to obtain third-party grants and
funding for developing the technology; and,
- Identifying any potential licensee's of the technology.
FEES:
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- $3,000 per month for first 40 hours, $75 per hour thereafter with first
obtaining written authorization from the Corporation, to be paid upon
receipt of itemized xxxx if amount is not in dispute
- plus reasonable, pre-approved expenses.
Notwithstanding anything to the contrary above:
- First month's $3,000 to be paid upon delivery of executed Agreement;
- Subsequent invoices shall be deferred and accrued until such time as the
Corporation's stock registration statement is declared effective by
the US Securities and Exchange Commission, whereupon the Corporation shall
pay all the deferred and accrued invoices, and shall cease to defer and
accrue any future invoices.
