Exhibit 10.39
AMENDED AND RESTATED
ENGAGEMENT AGREEMENT
THIS AMENDED AND RESTATED ENGAGEMENT AGREEMENT (the "Agreement") is 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").
WHEREAS, Xxxxxx and the Company entered into an Engagement Agreement
effective as of dated January 1, 2004, (the "Existing Agreement");
WHEREAS, Xxxxxx and the Company wish to amend and restate the terms and
conditions of the Existing Agreement;
NOW, THEREFORE, the Company and the Employee hereby amend and restate
the Existing Agreement in its entirety and 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.
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(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.
4. Expenses. During the Service Period,Xxxxxx, upon presentation
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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.
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(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.
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(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.
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
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Agreement shall be in writing and shall be sent by telecopy or by certified or
registered mail addressed to the respective parties as follows:
(i) If to the Company, to:
HEMISPHERX BIOPHARMA, INC.
Xxx Xxxx Xxxxxx
0000 XXX Xxxxxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 1910
Telecopier No.: (000) 000-0000
Attention: President
(ii) If to Xxxxxx, to:
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
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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
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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.
(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.
By: /s/ Xxxxxx X. Xxxxxxxxx
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Xxxxxx X. Xxxxxxxxx, Secretary
/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
