CONSULTING AGREEMENT
Exhibit 10.16
Consulting Agreement (this “Agreement”), dated as of July 1, 2005 (the “Effective Date”), by
and between Intellect Neurosciences, Inc., a Delaware corporation (the “Company”) and Xxxxxx
Xxxxxxx (the “Consultant”).
WHEREAS, the Company desires to retain the consulting services of the Consultant, and the
Consultant desires to provide such consulting services to the Company, on the terms and conditions
provided in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and
for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1.
Engagement; Duties. The Company hereby engages the Consultant to allocate a reasonable
amount of business time to provide consulting services, including, but not limited to, services
related to strategic planning, organizing and managing our business operations, obtaining
additional financing for the Company, engaging other corporate partners to enter into related
collaborated arrangements with the Company and such other services as we may reasonably request
from time to time during the Term (as hereinafter defined) (the “Services”) and the Consultant
hereby accepts such engagement, all upon and subject to the terms and conditions hereinafter set
forth.
2.
Term; Termination.
(a) This initial term of this Agreement shall be for three (3) years following the Effective
Date, with automatic one (1) year renewal terms thereafter (collectively, the “Term”) unless
either party hereto gives written notice to the other party hereto at least sixty (60) days prior
to the expiration of any Term of such party’s election not to further extend this Agreement.
Notwithstanding anything to the contrary contained herein, the Company may terminate this
Agreement, without penalty, at any time and for any reason, upon sixty (60) days prior written
notice to the Consultant.
(b) This Agreement may be terminated prior to the expiration of the Term by either party
hereto for a material breach of this Agreement by the other party hereto, subject to a right to
cure within 60 days of written notice thereof. Notwithstanding the foregoing, termination of this
Agreement by either party hereto shall not preclude such parry’s rights to recovery under any
other remedy at law or equity. In the event of termination of the Services hereunder, (i) all
obligations of the Company to the Consultant hereunder shall forthwith terminate and the
Consultant shall have no right to compensation beyond that accrued prior to such termination, in
accordance with Section 3 hereof and (ii) all obligations of the Consultant to the Company
hereunder shall forthwith terminate and the Company shall have no right to the provision by the
Consultant of any of the duties and responsibilities set forth hereunder. In the event of the
termination or expiration of this Agreement, the Consultant shall be entitled to receive all fees
accrued through the date of such termination or expiration, in accordance with Section 3 hereof,
in full satisfaction of the Company’s obligations to the Consultant hereunder. The termination by
the Consultant pursuant to this Section shall terminate any and all
obligations and restrictions
imposed on the Consultant by this Agreement, other than the obligations imposed by Section 4 and
Section 5 hereof.
3. Compensation.
(a) During
the Term, Consultant shall receive, as full compensation for services rendered
under this Agreement and the Consultant’s observance and performance of all the provisions hereof,
a fee at a rate of $3,500 per month.
(b) During the Term, upon presentation of documentation of such expenses reasonably
satisfactory to the Company, the Company shall reimburse the Consultant for all ordinary and
reasonable out-of-pocket business expenses that are reasonably incurred by the Consultant in
furtherance of the Company’s business, in accordance with the Company’s policies with respect
thereto, as in effect from time to time.
(c) Consultant acknowledges that he is not an employee of the Company and, as such, he is
fully responsible for the payment of all taxes to all regulatory authorities, and the Company
shall issue a form 1099 for each tax year during which Consultant performs services for the
Company. Consultant shall not be eligible for any employee benefits except for benefits
specifically authorized by each such benefit plan as applicable to independent contractors of the
Company.
4. Confidentiality. During the Term and for a period of 36 months thereafter, unless
consented to in writing by the Company, the Consultant shall not, directly or indirectly, except
in the normal course of business: (i) disclose or use any Confidential Information, whether or not
acquired during business hours; or (ii) record, photograph or copy any Confidential Information.
Promptly upon the termination of the Services by the Company, the Consultant shall return to the
Company everything in the Consultant’s possession or control relating to any Confidential
Information; provided, however, that this Section shall not prohibit disclosure by the
Consultant of information which (a) generally becomes available to the public other than as a
result of disclosure by the Consultant, (b) becomes available to the Consultant on a
non-confidential basis from a source independent of the Company, or (c) is required to be
disclosed by law or regulatory or judicial process. For the purposes of this Agreement,
“Confidential Information” shall mean all Company proprietary information, technical data, trade
secrets, know-how and any idea in whatever form, tangible or intangible, including without
limitation, research, product plans, customer lists, markets, computer software, computer
programs, developments, inventions, discoveries, processes, formulas, algorithms, technology,
designs, drawings, marketing and other plans, business strategies and financial data and
information, whether or not marked as “Confidential.” “Confidential Information” shall also mean
information received by the Company from customers of the Company or other third parties subject
to a duty to keep confidential.
5.
Covenant Not to Compete. During the Term and for a period or
12 months thereafter,
unless consented to in writing by the Company, the Consultant shall not, directly or indirectly,
through cooperation or collaboration with any third party, hire, retain as an independent
contractor or otherwise induce the resignation from a position with the Company by, any other
employee of the Company.
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6. Separate Agreement. Section 4 and Section 5 hereof shall be construed as
agreements independent of the balance of this Agreement, and no claim or cause of action by the
Consultant against the Company, whether predicated on this Agreement or otherwise, shall
constitute a defense to the enforcement by the Company of the independent agreements contained in
Section 4 and Section 5 hereof. The Consultant acknowledges that in the event of a breach or
threatened breach of any of the provisions herein by the Consultant, the Company may suffer
irreparable damage and will not have an adequate remedy at law. Accordingly, in the event of an
actual or threatened breach by the Consultant of any portion of either Section 4 or Section 5, the
Company shall be entitled to an injunction restraining the Consultant from such actual or
threatened action, in addition to its other remedies at law or equity. Notwithstanding the
foregoing, if this Agreement is determined to have been wrongfully terminated by the Company (but
not upon expiration hereof), the provisions of Section 5 shall be null and void.
7. Intellectual Property, Etc.
(a) The Consultant hereby agrees that any and all information, intellectual property,
inventions and discoveries, whether or not patentable, that it makes, conceives expresses,
develops, and/or creates, whether actually or constructively reduced to practice by the Consultant
solely or jointly with others and which are a result of Services performed hereunder
(collectively, the “Assigned Inventions”), shall be work for hire and shall be the sole and
exclusive property of the Company. The Consultant hereby assigns to the Company any and all right,
title and interest which the Consultant has or may acquire in the Assigned Inventions. The
Consultant further agrees that it will promptly execute any and all applications, assignments or
other instruments which an officer or the Board of Directors of the Company shall deem necessary
or useful in order to apply for and obtain patents in the United States and all foreign countries
for the Assigned Inventions and in order to assign and convey to the Company the sole and
exclusive right, title and interest in and to the Assigned Inventions. The Company will bear the
cost of preparation of all such patent applications and assignments, and the cost of prosecution
of all such applications in the United States Patent Office and in the patent offices of foreign
countries.
(b) Unless otherwise agreed between the Consultant and the Company, all documents, records,
apparatus, equipment and other physical property furnished to the Consultant by the Company or
produced by the Consultant or others in connection with the provisions of the Services shall be
and remain the sole property of the Company. The Consultant shall return and deliver such property
to the Company as and when requested by the Company. Notwithstanding any provision in this
Agreement to the contrary, Company agrees that Consultant shall have
the right to retain in the
files of its legal counsel, solely for legal archival purposes, one copy of all writings or other
tangible form materials provided by the Company as a record thereof (provided that such legal
counsel shall be bound by all confidentiality provisions set forth
in this Agreement with respect
to any such materials.)
8. Representations and Warranties of the Consultant. The Consultant hereby represents
and warrants to the Company that: (i) the Consultant is not under any other obligation,
contractual or otherwise, to any other person or entity which would prevent entry into, or prevent
or impair the performance of the provisions of this Agreement and
(ii) this Agreement has been
duly executed and delivered by the Consultant and constitutes a valid and binding agreement
enforceable against the Consultant in accordance with its terms.
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9. Nature of Relationship. In the performance of the Services under this
Agreement, the Consultant shall be an independent contractor and not an agent or employee of the
Company.
10. Notices. Any notice hereunder shall be in writing and shall be deemed duly given (i)
upon mailing a confirmation by first class mail, postage prepaid, of a facsimile or e-mail
transmission, (ii) when sent by overnight delivery by courier, or (iii) when mailed by registered
or certified mail return receipt requested and postage prepaid.
11. Governing Law. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York applicable to agreements made and to be performed wholly within
such state.
12. Arbitration. In the event that there is a dispute arising out of or relating to this
Agreement, then at the request of either party hereto made to the other party in writing, such
disagreement shall be resolved by arbitration in the city of New York, New York, in accordance
with the governing rules of the American Arbitration Association, before a single arbitrator
selected in accordance with said rules. The non-prevailing party shall bear the prevailing party’s
respective costs, fees and expenses in connection with such arbitration. Judgment upon the award
rendered may be entered by any State or Federal court located in said city, and each of the
parties hereto hereby consents to the jurisdiction of such court and that process, notice of
motion, or other application of the court, or a judge thereof, or any notice in connection with
the proceedings provided for herein, may be served within or without the State of York in
accordance with provisions herein for the serving of notice.
13.
Severabihtv. In the event that any provision of this Agreement shall be held invalid
or unenforceable, such holding shall not invalidate or render unenforceable any other provision
hereof.
14. Prior Agreements. This Agreement shall supersede all other prior agreements with
respect to the matters covered hereby.
15.
Amendment; Waiver. No amendment hereof shall be valid unless signed by all parties
hereto. No waiver of any breach or default hereunder shall be valid unless written and signed by
the party giving such waiver, and no such written waiver shall be deemed a waiver of any
subsequent breach or default of the same or similar nature.
16. Binding Agreement. This Agreement shall be binding upon and inure to the benefit
of each party hereto, its successors and permitted assigns.
17. Counterparts. This Agreement may be executed in two or more counterparts, and by
different parties hereto on separate counterparts, each of which will be deemed an original, but
all of which together will constitute one and the same instrument.
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IN WITNESS WHEREOF, the Company and the Consultant have executed this Agreement as of
the day and year first above written.
| THE COMPANY: | ||||||
| INTELLECT NEUROSCIENCES, INC. | ||||||
| By: | /s/ Xxxxxx Chain
|
|||||
| Name: XXXXXX CHAIN | ||||||
| Title: CEO | ||||||
| THE CONSULTANT: | ||||||
| XXXXXX XXXXXXX | ||||||
| By: | /s/ Xxxxxx X. Xxxxxxx
|
|||||
| Title: Managing Director | ||||||
