CONSULTING AGREEMENT
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This Consulting Agreement made as of the 1st day of July, 1998 by and
between Advanced Viral Research Corp., a Delaware corporation, with offices
located at 000 Xxxxxxxxx Xxxxxxxxx Xxxxx, Xxxxx 0, Xxxxxxx, Xxx Xxxx 00000 (the
"Company") and Xxxxxx X. Xxxxxxxx, residing at 000 Xxxxxx Xxxxxx, Xxxxxx Xxxx,
Xxx Xxxxxx 00000 (the "Consultant").
W I T N E S S E T H:
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A. The Company is involved in research and development with respect to
the drug Reticulose and related pharmaceutical products;
B. The Consultant is a licensed physician who has practiced his
profession in several jurisdictions including ____________________ and
________________, from time to time, has had experience in using Reticulose with
respect to the treatment of patients.
C. The Company seeks to obtain the expertise of the Consultant as an
advisor and consultant, from time to time to perform services as more
particularly described herein; and
D. Consultant is willing to serve as Consultant to the Company in
accordance with the provisions of this Agreement.
NOW, THEREFORE, it is agreed as follows:
1. Terms of Agreement. This Agreement shall commence as of the date
hereof and shall continue until December 31, 2000 unless sooner terminated in
accordance with the provisions of this Agreement.
2. Responsibilities of Consultant
2.1 Subject to the terms and conditions hereinafter set forth,
the Company hereby retains the Consultant and the Consultant hereby agrees, to
use his expertise to render assistance to the Company in connection with the
research, development, production, marketing and sale of Reticulose throughout
the world. At the request of the Company from time to time, the Consultant will
travel to those locations within or without the United States where the Company,
directly or indirectly, is involved in the research, manufacturing or testing of
Reticulose. including those locations in which the Company is conducting
clinical trials. Consultant shall devote such time as is necessary and required
to carry out his duties in assisting die Company hereunder. Consultant shall not
have authority to execute any agreements or make any commitments on behalf of
the Company, but Consultant may advise others that he is engaged as a consultant
for the Company. The Consultant shall not be an employee or agent of the
Company; all services will be rendered as an independent contractor. Consultant
shall act in good faith to carry forward the reputation of the
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Company and shall take no action which would jeopardize the Company from doing
business anywhere in the world.
2.2 At the request of the Company, Consultant agrees to
testify before the Food and Drug Administration in connection with its
application for approval of Reticulose.
2.3 Consultant agrees to provide the Company with detailed
clinical reports regarding patients observed by Consultant in Santo Xxxxxxx,
Dominican Republic and elsewhere if he performs similar services in other
locales.
3. Compensation. The Consultant shall receive compensation for his
services as follows: in option to purchase 300,000 shares of the Company's
Common Stock (par value $.0001 per share) at an exercise price of $.30 per
share. The options shall be exercisable in equal installments on January 1, 1999
and 2000 and December 15, 2000 provided that this Agreement shall be in force on
such dates.
4. Reimbursable Expenses. The Company shall reimburse Consultant for
all out-of-pocket expenses reasonably incurred by him in connection with the
performance of his duties hereunder and the business of the Company upon the
submission to the Company of appropriate receipts and/or other documentation
consistent with Company policy.
5. Property Rights of Parties.
5.1 Consultant shall not disclose any mich trade secrets
directly or indirectly nor use them in any way either during the term of this
Agreement or at any time thereafter except as required in the course of his
consulting. All files, records, documents, drawings. specifications, equipment
and similar items relating to the business of the Company, whether or not
prepared by Consultant, shall remain the exclusive property of the Company and
shall not be removed from the premises of the Company under any circumstances,
except in pursuit of the trade and business of the Company.
5.2 On the termination of this Agreement or whenever requested
by the Company, Consultant shall immediately deliver to the Company all property
in Consultant's possession or under Consultant's control belonging to the
Company, including but not limited to all accounting records, computer terminals
and tapes, disks, or other data storage mechanisms, accounting machines, and all
office furniture and fixtures, supplies and other personal property in the
possession or under the control of Consultant, in good condition, ordinary wear
and tear excepted, and including without limitation all correspondence files,
research data, and patent information or data, of every sort.
5.3 Consultant does not claim any rights or interest in and to
trade secrets, formulas, devices, inventions, processes. patents, applications,
continuations. copyrights, trademarks, compilations of information, records,
specifications, rights, interests and data of any other sort, affecting or
pertaining directly or indirectly to the business of the Company as now
conducted, or to the patents, trade secrets, and other rights now owned by the
Company.
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5.4 Consultant agrees that he will promptly and fully inform
and disclose to the Company all inventions. designs, improvements and
discoveries that Consultant may have during the term of this Agreement that
pertain or relate to the business of the Company or to any experimental work
carried on by the Company, whether conceived by Consultant alone or with others
and whether or not conceived during regular working hours. All such inventions,
designs, improvements and discoveries shall be the exclusive property of the
Company. Consultant shall assist the Company in obtaining patents on all such
inventions, designs, improvements and discoveries deemed patentable by the
Company, and shall execute all documents and do all things necessary to obtain
such patents for the Company.
5.5 It is contemplated that Consultant, in the course of his
work, may be engaged in work involving various patents and secret processes
owned by the Company. All experiments, developments, formulas, patterns,
devices, secret inventions arid compilations of information, records, and
specifications regarding such matters are trade secrets, which Consultant shall
not disclose directly or indirectly to anyone other than the Company, or use in
any way, either during the term of this Agreement or at any time after the
termination of this Agreement, except as required in the course and scope of his
engagement.
6. Restrictive Covenant.
6.1 During the term of this Agreement and thereafter for a
further period of three years, the following shall apply.
(a) Consultant shall not directly or indirectly own,
manage, operate, invest in, render services to or otherwise participate in or be
connected with, in any manner, whether as an officer, director. employee,
partner, investor, consultant or otherwise, any business entity which is
primarily engaged in the business of manufacturing, producing, marketing,
promoting or selling pharmaceuticals which can be described as peptide nucleic
acids or selling pharmaceuticals which can be described as peptide nucleic acids
or any other business in which the Company was engaged on the effective date of
the termination of this Agreement or in which the Company or any of its
subsidiaries or affiliates was actively engaged in soliciting during the 180-day
period prior to the effective date of termination of this Agreement with the
Company.
Nothing contained herein shall be deemed to prohibit Consultant from
investing his funds in securities of a company if such securities are listed for
trading on a national stock exchange or traded in the over-the-counter market,
such company is not a competitor of the Company and Consultant's holdings
therein represent less than one (1%) percent of such securities outstanding.
(b) Consultant shall not for himself or an behalf of
any other person, partnership, corporation or entity, directly or indirectly, or
by action in concert with others, (i) call on any customer of the Company for
the purpose of soliciting, diverting or taking away any customer from the
Company or (ii) induce, influence or seek to induce or influence any person who
is engaged as an employee, representative. agent, independent contractor or
otherwise by the Company, to terminate his or her relationship with the Company.
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6.2 The parties hereto acknowledge that Consultant's services
are of a special, unique, extraordinary and intellectual character which gives
him peculiar value and that the business of the Company and its subsidiaries is
highly competitive and that violation of any of the covenants provided in
Section 6 of this agreement would cause immediate, immeasurable and irreparable
harm, loss and damage to the Company not adequately compensable by a monetary
award. Consultant acknowledges that the time, geographical area and scope of
activity restrained by the provisions of Section 6 are reasonable and do not
impose a greater restraint than is necessary to protect the goodwill of the
Company's business. Consultant further acknowledges that he and the Company have
negotiated and bargained for the terms of this agreement and that Consultant has
received adequate consideration for entering into this agreement including the
provisions of this Section 6. In the event of any such breach or threatened
breach by Consultant of any one or more of such covenants, the Company shall be
entitled to such equitable and injunctive relief as may be available to restrain
Consultant and any business, firm, partnership, individual, corporation or
entity participating in such breach or threatened breach from the violation of
the provisions hereof. Consultant further agrees that any temporary restraining
order or emergency, preliminary or final may be issued by any court of competent
jurisdiction. To the fullest extent permitted by law, Consultant hereby waives
any right to require the posting of a bond as a condition to the issuance or
maintenance of such order or injunction and agrees that any such order or
injunction may be entered and maintained without the posting of a bond. Nothing
herein shall be construed as Prohibiting the Company from pursuing any other
remedies available at law or in equity for such breach or threatened breach,
including the recovery of damages and the immediate termination of the
employment of Consultant hereunder.
7. Finder's Fee. The Company agrees to Pay the Consultant a Finder's
Fee (as hereinafter defined) for any funds aggregating at least $2M raised by
the company from any sources introduced by the Consultant through the public or
private sale of equity or debt securities with equity features, whether or not
such financing is completed during the term of this Agreement or for a period of
one year subsequent to the date that this Agreement has otherwise terminated.
For purposes of this Section 7. Finder's Fee shall mean an option to purchase
200,000 shares of Common Stock of the Company at the then current market price
per share. The options shall be exercisable in three equal annual installments,
commencing on the first anniversary of the closing of such public or private
sale of equity or debt securities with equity features.
8. Right to Terminate Agreement. Either party may terminate this
Agreement at any time by giving the other party at least thirty (30) days prior
written notice; provided, however, that the obligations of the parties pursuant
to Sections 6 and 7 hereof shall survive termination.
9. Entire Agreement This Agreement constitutes the entire Agreement of
the parties hereto with respect to the subject matter hereof and no amendment or
modification hereof shall be valid or binding unless made in writing and signed
by the party against whom enforcement thereof is sought.
10. Notices. Any notice required, permitted or desired to be given
pursuant to any of the provisions of this Agreement shall be deemed to have been
sufficiently given or served for all purposes if delivered in person or sent by
telephone facsimile or sent by certified mail, return
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receipt requested, or sent by responsible overnight delivery service, postage
and fees prepaid, to the parties hereto at their respective addresses set forth
below. Either of the parties hereto may at any time and from time to time change
the address to which notice shall be sent hereunder by notice to the other party
given under this Section 10. The date of the giving of any notice sent by mail
shall be three business days following the date of the posting of the mail, the
date delivered in person, the next business day following delivery to an
overnight delivery service or the date sent by telephone facsimile, as
applicable.
If to the Company:
Advanced Viral Research Corp.
000 Xxxxxxxxx Xxxxxxxxx Xxxxx
Xxxxxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxxxxxx, M.D.
Telephone: 000-000-0000
Facsimile: 000-000-0000
With a copy to:
Wolf, Block, Xxxxxx and Xxxxx-Xxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxxx, Esq
If to Consultant:
000 Xxxxxx Xxxxxx
Xxxxxx Xxxx., Xxx Xxxxxx 00000
Telephone:
11. No Assignment. Neither this Agreement nor the right to receive any
payments hereunder may be assigned by Consultant. This Agreement shall be
binding upon Consultant, his heirs, executor s and administrators and upon the
Company, its successors and assigns.
12. No Waiver. No course of dealing nor any delay on the part of the
Company in exercising any rights hereunder shall operate as a waiver of any such
rights. No waiver of any default or breach of this Agreement shall be deemed a
continuing waiver or a waiver of any other breach or default.
13. Governing Law. This Agreement shall be governed, interpreted and
construed in accordance with the substantive laws of the State of New York
applicable to Agreements entered into and to be performed entirely therein. Any
suit, action or proceeding with respect to this Agreement shall be brought
exclusively in the courts of the State of New York, County of New York or in the
United States District Court for the Southern District of New York.
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14. Severability. If any clause, paragraph. section or part of this
Agreement shall be held or declared to be void, invalid or illegal, for any
reason, by any court of competent jurisdiction, such provision shall be
ineffective but shall not in any way invalidate or affect any other clause,
paragraph, section or part of this Agreement. The parties intend that all
clauses, paragraphs, sections or parts of this Agreement shall be enforceable to
the fullest extent permitted by law.
15. Counterparts. This Agreement may be executed in one or more
counterparts, each of which counterparts, when taken together, shall constitute
but one and the same agreement.
IN WITNESS WHEREOF, the panics hereto have caused this Agreement to be
duly executed as of the day and year first above written.
ADVANCED VIRAL RESEARCH CORP.
By: /s/ Xxxxxx X. Xxxxxxxxx, M.D.
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Name: Xxxxxx X. Xxxxxxxxx, M.D.
Title: President
/s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx
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