AMENDED AND RESTATED CONSULTING AGREEMENT
This AMENDED AND RESTATED CONSULTING AGREEMENT (this "Agreement"), dated as
of May __, 2001, is entered into, by and among HELIX BIOMEDIX, INC., a Delaware
corporation ("Helix"), XXXX-XXXXXX VENTURES L.L.C. ("Consultant"), Xxxxx Xxxx
("Xxxx") and Xxxxxxx X. Xxxxxx ("Xxxxxx") (Xxxx and Xxxxxx are sometimes
referred to herein collectively as the "Consulting Principals").
PRELIMINARY RECITALS
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WHEREAS, Helix and Consultant entered into a consulting agreement on
September 30, 1999, containing provisions relating to the services to be
provided to Helix by Consultant and the compensation to be paid by Helix to
Consultant; and
WHEREAS, Helix and Consultant desire to amend and restate the terms
governing the relationship between the parties:
NOW, THEREFORE, in consideration of the premises, the mutual covenants of
the parties hereinafter set forth and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. Termination of Prior Agreement.
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The prior agreement between the parties, dated September 30, 1999, is
terminated and superseded in its entirety by this Agreement. Notwithstanding
such termination, Helix acknowledges that Consultant has previously been awarded
stock and options covering 280,000 shares in the aggregate, and agrees to take
no steps to seek the return of such shares.
2. Compensation.
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In consideration for the services heretofore rendered by Consultant and its
agreement not to compete with Helix, Helix shall:
(a) pay to Consultant the sum of Eighty Thousand Dollars ($80,000) on
or before July 1, 2001.
(b) extend to Consultant, subsequent to Consultant and the Consulting
Principals executing a promissory note, in substantially the form as
Exhibit A attached hereto, payable to Helix bearing interest at 5.985% per
annum and bearing a term of sixty (60) days, a loan in the amount of Eighty
Thousand Dollars ($80,000); and
(c) issue to Consultant warrants to purchase Company common stock at
the following exercise prices and amounts, all such warrants to expire on
June 30, 2011:
(i) Fifty Thousand (50,000) shares at $1.50 per share;
(ii) Fifty Thousand (50,000) shares at $3.00 per share;
(iii) Fifty Thousand (50,000) shares at $4.50 per share; and
(iv) Fifty Thousand (50,000) shares at $6.00 per share.
2.1 Restricted Stock
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(a) Consultant recognizes and understands that neither the warrants to
be issued to Consultant hereunder nor the shares of Helix stock which may
be obtained upon exercise of those warrants (collectively the "Securities")
will be registered under the Securities Act of 1933 (the "Securities Act")
or under the securities laws of any state.
(b) Consultant represents and warrants that (i) each of the Consulting
Principals has knowledge and experience in business, finance, securities
and investments, such experience being based on actual participation
therein; (ii) each of the Consulting Principals is capable of evaluating
the merits and risks of an investment in the Securities; (iii) each of the
Consulting Principals is an experienced and sophisticated investor and has
experience in investments similar to that of the Securities; (iv) the
Securities which may be acquired by it will be acquired solely for
investment and not with a view toward resale or redistribution; (v) no
assurances have been made concerning the future results of Helix or as to
the value of the Securities; (vi) it (and each of the Consulting
Principals) is an accredited investor within the meaning of Regulation D
promulgated under the authority of the Securities Act; and (vii) the
Consulting Principals are the sole equity owners of Consultant.
(c) Consultant has consulted with its own counsel in regard to the
securities laws and is fully aware (i) of the circumstances under which it
is required to hold the Securities; (ii) of the limitations on the transfer
or disposition of the Securities; and (iii) that the Securities must be
held indefinitely unless the transfer thereof is registered under the
securities laws or an exemption from registration is available.
(d) Consultant has been furnished with a copy of the Annual Report on
Form 10-KSB of Helix filed with the Commission under the Securities
Exchange Act of 1934, as amended, for the fiscal year ended December 31,
2000. Helix has made available to Consultant the opportunity to ask
questions and receive answers concerning the terms and conditions of the
transactions contemplated by this Agreement and to obtain any additional
information which they possess or could reasonably acquire for the purpose
of verifying the accuracy of the information furnished to Consultant as set
forth herein or for the purpose of considering the transactions
contemplated hereby. Helix has offered, and agrees during the term of this
Agreement, to make available to Consultant upon request at any time all
exhibits filed by Helix with the Securities and Exchange Commission as part
of any of the reports filed therewith.
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3. Restrictive Covenant.
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Except as otherwise agreed to in writing by Helix, for a period of two
years following execution of this Agreement, neither Consultant nor any of the
Consulting Principals shall as an individual, partner, member of a joint
venture, consultant agent, salesman, director or stockholder (other than a
beneficial holder of not more than 5% of the outstanding voting stock of a
company having at least 250 holders of voting stock) of a corporation, or
otherwise directly or indirectly:
(a) enter into or engage in any business or consult with any business
or entity competitive with Helix in the area of the research into and
development of commercial applications for lytic peptide technology within
any area of the United States in which Helix is then doing business;
(b) solicit or attempt to solicit any of Helix's customers with whom
Consultant has had contact as a Consultant or employee of Helix with the
intent or purpose to perform for such customer the same or similar services
which Consultant performed for such customer during the term of his service
hereunder or employment by Helix;
(c) employ or solicit, or attempt to employ or solicit, for himself or
any third party, the employment of any of Helix's employees; or
(d) induce or attempt to induce any employee, consultant or agent of
Helix to discontinue providing services to Helix.
4. Right of First Refusal.
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Subject to the terms and conditions specified in this Section 4, Consultant
and the Consulting Principals hereby grant to Helix a right of first refusal
with respect to any future sales by Consultant of shares of Helix's common stock
now owned or which may be received pursuant to execution of any warrants
described in Section 2(b) above (the "First Refusal Shares").
Except as may be provided in Section 4(c) below, each time Consultant or a
Consulting Principal proposes to offer any First Refusal Shares, such party (the
"Offering Party") shall first make an offer of such shares to the Company in
accordance with the following provisions:
(a) The Offering Party shall deliver a notice by certified mail
("Notice") to Helix stating (i) its bona fide intention to offer such First
Refusal Shares, (ii) the number of such shares to be offered, and (iii) the
price and terms, if any, upon which it proposes to offer such shares.
(b) Within 7 calendar days after giving of the Notice, Helix may elect
to purchase or obtain, at the price and on the terms specified in the
Notice, any or all of the First Refusal Shares offered by the Offering
Party.
(c) The provisions of this Section 4 shall not apply to offers by
Consultant to sell Helix's common stock in brokers' transactions as defined
in Section 4(4) of the Securities Act.
5. Release of Claims.
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Each of the parties to this Agreement hereby agrees to fully and forever
release, acquit and discharge all other parties to this Agreement, their past
and present, subsidiary and affiliated corporations, divisions and business
entities, and their past and present officers, directors, trustees, employees
and agents from any and all liability for any and all injuries, claims, demands,
damages, actions or suits of any kind or nature, including attorneys' fees and
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costs, arising out of Consultant and the Consulting Principals activities as
such, based on any facts in existence in whole or in part at the time of the
signing of this Agreement, and whether known or unknown at the time of the
execution of this Agreement. This Section 5 shall not be interpreted to
constitute a release of any claim arising from service by either of the
Consulting Principals on the Board of Directors of Helix.
6. Assignment.
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No party hereto may assign or delegate any of its rights or obligations
hereunder without the prior written permission of the other party hereto. Except
as otherwise expressly provided herein, all covenants and agreements contained
in this Agreement by or on behalf of the parties hereto shall be binding and
inure to the benefit of the respective legal representatives, heirs, successors,
affiliates and assigns of the parties hereto.
7. Severability.
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If any provision of this Agreement is held to be unenforceable for any
reason, it shall be adjusted rather than voided, if possible, in order to
achieve the intent of the parties to the extent possible. In any event, all
other provisions of this Agreement shall be deemed valid and enforceable
notwithstanding the adjustment or elimination of any such unenforceable
provision.
8. Counterparts.
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This agreement may be executed in multiple counterparts, each of which
shall be deemed an original, but all of which taken together shall constitute
one and the same Agreement.
9. Descriptive Headings: Interpretation.
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The descriptive headings in this Agreement are inserted for convenience of
reference only and are not intended to be part of or to affect the meaning or
interpretation of this Agreement.
10. Notices.
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All notices, demands or other communications to be given or delivered under
or by reason of the provisions of this Agreement shall be in writing and shall
be deemed to have been duly given if (i) delivered personally to the recipient;
(ii) sent to the recipient by reputable express courier services (charges
prepaid); (iii) mailed to the recipient by certified or registered mail, return
receipt and postage prepaid; or (iv) transmitted by facsimile to the recipient
with a confirmation copy to follow the next day to be delivered by overnight
carrier. Such notices, demands and other communications shall be sent to the
addresses indicated below, or to such other address as the party may specify in
writing:
(a) If to Consultant, Xxxx or Xxxxxx
Xxxx-Xxxxxx Ventures L.L.C.
000 Xxxx Xxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx
Facsimile: (000) 000-0000
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(b) If to Helix
Helix BioMedix, Inc.
000 Xxxxxxx Xxxxxx, xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxx 00000
Attn: Xxxxxxxxx X. Xxxxxx
Facsimile: (000) 000-0000
The effective date of such notice shall be the date such notice is
personally delivered, three days after the date of mailing if sent by certified
or registered mail, one day after the date of delivery to the overnight courier
if sent by overnight courier, or the next business day after the date of
transmission if sent by facsimile.
11. Confidential Information and Discoveries.
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Consultant and each of the Consulting Principals agree that all information
of a technical or business nature including but not limited to know-how, trade
secrets, secret business information, plans, data, processes, techniques,
customer information, inventions, discoveries, formulae, patterns and devices
("Confidential Information") pertaining to the business of Helix is a valuable
business property right of Helix. Consultant and the Consulting Principals agree
that such Confidential Information, whether in written, verbal or model form,
shall not be disclosed to anyone outside the employment of Helix or otherwise
used by Consultant or the Consulting Principals for any purpose other than the
fulfillment of their respective obligations under this Agreement without the
express authorization of Helix. Confidential Information does not include
information which Consultant or the Consulting Principals can demonstrate (i)
has become generally available to the public other than as a result of a
disclosure by Consultant or the Consulting Principals; or (ii) has become
available to Consultant or the Consulting Principals on a non-confidential basis
from a source other than Helix, provided such source is not bound by a
confidentiality agreement with Helix or otherwise prohibited from transmitting
the information to Consultant or the Consulting Principals by a contractual,
legal or fiduciary obligation.
Any and all improvements, inventions, discoveries, formulae or processes in
any way related to Helix's business which Consultant or the Consulting
Principals may conceive or make during regular working hours or otherwise shall
be sole and exclusive property of Helix and Consultant and the Consulting
Principals will disclose the same to Helix and will, whenever requested by Helix
to do so (either during the term of this Agreement or thereafter), execute and
assign any and all applications, assignments or other instruments and do all
things which Helix may deem necessary or appropriate in order to apply for,
obtain, maintain, enforce and defend patents, copyrights, trademarks or other
forms of protection, or in order to assign or convey or otherwise make available
to Helix the sole and exclusive right, title and interest in and to said
improvements, inventions, discoveries, formulae, processes, applications or
patents.
No provision in this Agreement is intended to require assignment of any of
the rights of Consultant or the Consulting Principals in an invention if no
equipment, supplies, facilities, or trade secret information of Helix was used
to develop same, and if the invention was developed entirely on Consultant's or
the Consulting Principals' own time, and the invention does not relate to the
business of Helix or to Helix's actual or demonstrably anticipated research or
development and does not result from any work performed by the Consultant or the
Consulting Principals for Helix.
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The provisions of this Section 11 shall continue until two years following
the execution of this Agreement.
12. Return of Documents.
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Consultant shall forthwith return and deliver to Helix and shall not retain
any original or copies of any books, papers, price lists, customer contracts,
bids, customer lists, files, books of account, notebooks and other documents and
data (in printed, audio, video, electronic or other form) relating to the
performance of services rendered by Consultant hereunder, all of which materials
are hereby agreed to be the property of Helix.
13. Preliminary Recitals.
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The preliminary recitals set forth in the preamble hereto are hereby
incorporated and made part of this Agreement.
14. Entire Agreement.
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Except as otherwise expressly set forth herein, this Agreement sets forth
the entire understanding of the parties, and supersedes and preempts all prior
oral or written understandings and agreements with respect to the subject matter
hereof.
15. Governing Law.
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This Agreement shall be construed and enforced in accordance with and all
questions concerning the construction, validity, interpretation and performance
of this Agreement shall be governed by the laws of the State of Washington as
applied to Washington residents.
16. Representations and Warranties.
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16.1. Helix represents and warrants that (i) it is a corporation, duly
organized, validly existing and in good standing under the laws of the
state of Delaware, has duly authorized the execution and performance of
this Agreement, and such execution and performance will not violate its
Certificate of Incorporation, Bylaws, or any contract or agreement by which
it is bound; and (ii) when executed and delivered, this Agreement will be
enforceable in accordance with its terms, subject to bankruptcy, insolvency
and similar laws affecting creditors' rights generally.
16.2. Consultant and the Consulting Principals jointly and severally
represent and warrant that (i) Consultant is a limited liability company
duly organized, validly existing and in good standing under the laws of the
State of Delaware, has duly authorized the execution and performance of
this Agreement, and such execution and performance will not violate its
Articles of Organization, Operating Agreement, or any contract or agreement
by which it is bound and (ii) this Agreement is valid and enforceable
against Consultant and the Consulting Principals in accordance with its
terms and each instrument to be executed by Consultant and the Consulting
Principals pursuant to this Agreement will, when executed and delivered, be
enforceable in accordance with its terms, subject to bankruptcy, insolvency
and similar laws affecting creditors' rights generally.
17. Compliance with Laws.
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Consultant shall comply with all federal, state and local laws,
regulations, ordinances, orders, decrees, resolutions and other acts of any
governmental entity, including but not limited to securities laws and
regulations that are applicable to this Agreement and the work and services
performed or provided hereunder.
18. Attorney's Fees.
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If a dispute arises relating to the performance of the obligations of
either Consultant (or the Consulting Principals) or Helix pursuant to the terms
of this Agreement and legal or other costs are incurred, the prevailing party
shall be entitled to recover all reasonable costs incurred in the defense or
prosecution of the claim, including court costs, reasonable attorney's fees and
other claim-related expenses.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year above first written.
HELIX BIOMEDIX, INC.
/s/ R. Xxxxxxx Xxxxxx /s/ Xxxxx Xxxx
-------------------------------- ---------------------------------
By: R. Xxxxxxx Xxxxxx Xxxxx Xxxx
President and Chief Executive Officer
XXXX-XXXXXX VENTURES L.L.C.
/s/ Xxxxxxx X. Xxxxxx
-------------------------------- ---------------------------------
By: Xxxxxxx X. Xxxxxx
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Exhibit A
PROMISSORY NOTE
$80,800 Seattle, Washington
May 1, 2001
The undersigned, Xxxx-Xxxxxx Ventures L.L.C., Xxxxx Xxxx and Xxxxxxx X. Xxxxxx
(collectively "Maker"), promise to pay to Helix BioMedix, Inc. or order
(collectively, "Holder"), the sum of Eighty Thousand Eight Hundred Dollars
($80,800) including accrued interest, all as hereinafter provided and upon the
following agreements, terms and conditions.
Interest Rate
The entire principal balance of this Note shall bear simple interest from
the date of this Note until this Note is fully paid at the rate of six percent
(5.985%) per annum.
Payments
All interest to accrue under the term of this note shall be retained by
Holder at the initial disbursement of funds under this Note. The entire
principal balance of this Note shall be due and payable on or before July 1,
2001, and may be prepaid at any time without penalty.
The principal balance may be paid in whole or in part through the surrender
and redemption of shares of Helix Common Stock, such securities being valued at
the closing trade on the day such shares are tendered in repayment of the
principal balance.
Place of Payment
All payments pursuant to this Note shall be made to Holder at 000 Xxxxxxx
Xxxxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxx 00000, or such other address as
Holder may hereafter designate from time to time.
Default; Default Interest
If Maker fails to pay this Note in strict accordance with its terms, or if
Maker otherwise defaults under this Note, this Note shall bear interest from the
date of default by Maker until the default is fully cured at a default interest
rate ("Default Rate") equal to sixteen percent (16%) per annum. Notwithstanding
the foregoing, if Maker defaults as described in this paragraph, at the option
of Holder, this entire Note shall become immediately due and payable. After
acceleration, this Note shall bear interest at the Default Rate.
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Applicable Law
This Note shall be construed in accordance with and governed by the laws of
the State of Washington.
Successors and Assigns
This Note shall inure to the benefit of Holder and any successor or
assignee of Holder. This Note shall be binding upon Maker and Maker's
successors, assignees, personal representatives and heirs.
Costs and Expenses
Maker shall pay all costs and expenses which Holder may incur in connection
with this Note because of Maker's default, including, without limitation, the
following costs: (a) reasonable attorneys' fees for legal services incurred by
Holder in connection with any default by Maker relating to any determination of
any rights or remedies of Holder; and (b) reasonable attorneys' fees for any
actions, proceedings, reviews or appeals therefrom which Holder may institute or
in which Holder may appear or participate.
Liability
Each person signing this Note shall be jointly and severally liable with
respect to this Note and hereby waives demand, presentment for payment, notice
of intention to accelerate the maturity, protest and notice of protest and
nonpayment. Each such party hereby further agrees that none of the following
events (with or without notice) shall diminish, impair or otherwise affect the
liability of any such party with respect to this Note: (a) any modification or
extension of the terms of this Note; or (b) any release of any party liable
pursuant to this Note.
ORAL AGREEMENTS OR ORAL COMMITMENTS TO LOAN MONEY, EXTEND CREDIT, OR TO FORBEAR
FROM ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON LAW.
Xxxx-Xxxxxx Ventures L.L.C. /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
By:
---------------------------------- /s/ Xxxxx Xxxx
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Its: Xxxxx Xxxx
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