AMENDED AND RESTATED ENGAGEMENT AGREEMENT
Exhibit
10.2
AMENDED
AND RESTATED
Agreement
made and entered into as of March 11, 2005 between Hemispherx Biopharma, Inc. a
Delaware Corporation (the “Company”) and Xxxxxxx X. Xxxxxx, M.D., of Tavernier,
Florida (“Xxxxxx”).
In
consideration of the premises and the mutual covenants and conditions herein
contained the Company and Xxxxxx hereby agree as follows:
1. Engagement. The
Company engages Xxxxxx and Xxxxxx agrees to serve the Company as a consultant
relating to patent development. Additionally, Xxxxxx shall serve, so
long as he is elected by the shareholders of the Company, as a Director of the
Company, and shall serve, so long as he is elected by the Board of Directors of
the Company, as chairman of the Executive Committee of the Board of Directors of
the Company. It is expressly understood and agreed that all of
Carter’s services hereunder are being provided as an independent contractor and
not as an employee for federal tax purposes.
2. Term. This
Agreement shall commence, retroactively, as of January 1, 2005 and shall
terminate on December 31, 2010 (the “Initial Termination Date”) unless sooner
terminated in accordance with Section 5 hereof or unless renewed as hereinafter
provided (such period of service together with any extension thereto hereinafter
being called the “Service Period”). This Agreement shall be
automatically renewed for successive one (1) year periods after the original
Termination Date unless written notice of refusal to renew is given by one party
to the other at least ninety days prior to the initial Termination Date or the
expiration of any renewal period.
3. Fees.
(a) For
his services to the Company the Company shall pay Xxxxxx a fee (the “Base Fee”)
of $207,776.88 per year (the “Original Base Fee”), which shall be subject to
adjustments as provided in succeeding subsections (b) and (c).
(b) On
January 1, 2006, and on January 1, of each succeeding calendar year during the
Service Period, the Base Fee shall be increased or decreased by the amount of
increase or decrease in the annual dollar value of Directors fees being provided
to the individual Directors of the Company from the December of the preceding
year to the December of the second preceding year.
(c) On
January 1, 2006, and on January 1 of each succeeding calendar year during the
Service Period and after the adjustment provided for in subsection (b) above,
the Base Fee shall be increased or decreased by a percentage equal to the
percentage average increase or decrease in the Bureau of Labor Statistics
“Consumer Price Index – U.S. City Average – All Items” from December of the
second preceding year.
(d) For
each calendar year (or part thereof) during which this Agreement is in effect,
Xxxxxx shall be eligible to be paid a performance bonus in an amount up to
twenty-five percent (25%) of his Base Fee then in effect, in the sole discretion
of the Compensation Committee of the Board of Directors based on Carter’s
performance for such year.
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4. Expenses. During
the Service Period, Xxxxxx, upon presentation of payment vouchers or receipts,
will be reimbursed for the reasonable and necessary expenses incurred by him in
providing services pursuant to this Agreement.
5. Termination.
(a) The
Company may discharge Xxxxxx for cause at any time as
provided herein. For purposes hereof, “cause” shall mean the willful engaging by
Xxxxxx in illegal conduct or gross misconduct which is demonstrably and
materially injurious to the Company. for purposes of this Agreement, no act, or
failure to act, on Carter's part shall be deemed "willful" unless done, or
omitted to be done, by Xxxxxx not in good faith and without reasonable belief
that Carter's action or omission was in the best interest of the Company.
Notwithstanding the foregoing, Xxxxxx shall not be deemed to have been
terminated for Cause unless and until the Company delivers to Xxxxxx a copy of a
resolution duly adopted by the affirmative vote of not less than three-quarters
of the entire membership of the Board at a meeting of the Board called and held
for such purpose (after reasonable notice to Xxxxxx and an opportunity for
Xxxxxx, together with counsel, to be heard before the Board) finding that, in
the good faith opinion of the Board, Xxxxxx was guilty of conduct set forth
above and specifying the particulars thereof in detail.
(b) This
Agreement shall terminate upon the death or disability of Xxxxxx. For
purposes of this subsection (b), “disability” shall mean the inability of Xxxxxx
effectively to substantially provide the services hereunder by reason of any
medically determinable physical or mental impairment which can be expected to
result in death or which has lasted or can be expected to last for a continuous
period of not less than twelve (12) months.
(c)
Xxxxxx
shall have the right to terminate this Agreement upon not
less than thirty (30) days prior written notice of
termination.
6. Effect of
Termination.
(a) In
the event that this Agreement is terminated for "cause" pursuant to subsection
5(a), the Company shall pay Xxxxxx, at the time of such termination,
only the fees due and payable to him through the date of the termination of this
Agreement.
(b) In
the event that this Agreement is terminated by the Company at any time without
"cause", as defined in subsection 5(a), the Company shall pay to Xxxxxx, at the
time of such termination, the fees otherwise due and payable to him through the
last day of the then current term of this Agreement.
(c) In
the event this Agreement is terminated at his election pursuant to subsection
5(c) or due to Carter’s death or disability pursuant to 5(b), the Company shall
pay to Xxxxxx, at the time of such termination, the fees otherwise due and
payable to him through the last day of the month in which such termination
occurs and for an additional twelve month period.
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7. Carter’s Representations and
Warranties. Xxxxxx hereby represents and warrants to the
Company that he has the right to enter into this Agreement, and his execution,
delivery and performance of this Agreement (a) will not violate any contract to
which Xxxxxx is a party or any applicable law or regulation nor give rise to any
rights in any other person or entity and (b) are not subject to the consent of
any other person or entity.
8. Notices. Any
notice or other communication pursuant to this Agreement shall be in writing and
shall be sent by telecopy or by certified or registered mail addressed to the
respective parties as follows:
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(i)
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If
to the Company, to:
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HEMISPHERX
BIOPHARMA, INC.
Xxx
Xxxx Xxxxxx
0000
XXX Xxxxxxxxx
Xxxxxxxxxxxx,
Xxxxxxxxxxxx 1910
Telecopier
No.: (000) 000-0000
Attention:
President
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(ii)
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If
to Xxxxxx, to:
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Xxxxxxx
X. Xxxxxx, M.D.
00000
Xxx Xxxxxxx
Xxxxxxxxx,
Xxxxxxx 00000
Telecopier
No.: (000) 000-0000
or
to such other address as the parties shall have designated by notice to the
other parties given in accordance with this section. Any notice or
other communication shall be deemed to have been duly given if personally
delivered or mailed via registered or certified mail, postage prepaid, return
receipt requested, or, if sent by telecopy, when confirmed.
9. Modification. No
modification or waiver of this Agreement or any provision hereof shall be
binding upon the party against whom enforcement of such modification or waiver
is sought unless it is made in writing and signed by or on behalf of both
parties hereto.
10. Miscellaneous. (a)
This Agreement shall be subject to and construed in accordance with the laws of
the Commonwealth of Pennsylvania.
(b) The
waiver by either party of a breach of any provision of this Agreement by the
other party shall not operate and be construed as a waiver or a continuing
waiver by that party of the same or any subsequent breach of any provision of
this Agreement by the other party.
(c) If
any provisions of this Agreement or the application thereof to any person or
circumstance shall be determined by an arbitrator (or panel or arbitrators) or
any court of competent jurisdiction to be invalid or unenforceable to any
extent, the remainder hereof, or the application of such provision to persons or
circumstances other than those as to which it is so determined to be invalid or
unenforceable, shall not - be affected thereby, and each provision hereof shall
be valid and shall be enforced to the fullest extent permitted by
law.
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(d) This
Agreement shall be binding on and inure to the benefit of the parties hereto and
their respective heirs, executors and administrators, successors and
assigns.
(e) This
Agreement shall not be assignable in whole or in part by either party, except
that the Company may assign this Agreement to and it shall be binding upon any
subsidiary or affiliate of the Company or any person, firm or corporation with
which the Company may be merged or consolidated or which may acquire all or
substantially all of the assets of the Company.
IN WITNESS WHEREOF, this
Agreement has been signed by the parties
hereto
as of the date first above written.
HEMISPHERX
BIOPHARMA, INC.
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By:
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/s/ Xxxxxx X. Xxxxxxxxx
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Xxxxxx
X. Xxxxxxxxx, Secretary
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By:
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/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx
X. Xxxxxx
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