EXHIBIT 99.2
CONSULTING AGREEMENT
This Agreement will confirm the arrangements, terms and conditions, whereby
the Undersigned (hereinafter referred to as the "Consultants") have been
retained by Alpha 1 Biomedicals, Inc. (the "Company") to serve as financial and
business consultants and advisors to the Company on a non-exclusive basis for a
period of nine months commencing as of August 16, 1999. The undersigned hereby
agree to the following terms and conditions:
1. CONSULTING SERVICES. The Consultants will render financial and
business consulting and advice pertaining to the Company as may from
time to time be requested by the Company. Without limiting the
generality of the foregoing, the Consultants will prepare a business
plan specifying a proposed business strategy for the Company, study
and evaluate financing and recapitalization proposals and prepare
other reports and studies when advisable.
2. SHORT-TERM FINANCING. Consultants will contact creditors and, if
possible, try to utilize SciClone stock sales proceeds for short term
funding purposes. Alternatively, Consultants and potentially certain
other investors shall fund a short-term operating plan by raising
approximately $50,000-$150,000 in the form of a convertible debenture
pursuant to the following terms:
(a) Up to $150,000 investment.
(b) An interest rate of 10% on the debenture, which interest shall
accrue and be applied at conversion.
(c) A conversion rate of 50% of the average July 1999 bid price of
the Company's common stock.
(d) An obligation by the Company to register such shares at the
earliest practicable time.
3. RIGHT TO PARTICIPATE IN SUBSEQUENT FINANCINGS: Upon next subsequent
round of financing, Consultants shall have the right to participate at
the same level as the then participating parties, or, it there is a
Rights Offering, Consultants shall have the right to purchase any or
all shares not purchased by the current stockholders.
4. SHORT-TERM MANAGEMENT OF COMPANY. Consultants shall manage the affairs
of the Company on a short-term basis as follows:
(a) Develop a plan and work with creditors in order to eliminate or
restructure all corporate debts.
(b) Evaluate and work with current professional organizations
necessary to the Company's mission, i.e. legal and auditing
firms.
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(c) Work with the SEC, NASD, NIH, Patent and Trademark Office to
bring the Company in compliance with government regulations or to
allow continuation of Company business.
(d) Set up a temporary office for the Company.
(e) Recommend changes in Corporate Governance, if necessary.
(f) Recommend recapitalization and financial strategy.
(g) Help recruit necessary management for Company.
(h) Negotiate with companies interested in licensing or other
business and financial relationships with the Company.
(i) Other issues as they occur.
5. COMPENSATION.
(a) Upon the execution of this Agreement, the Company shall deliver
to the Consultants a total of 7,500,000 option shares of common
stock at an exercise price of $.04 per share duly registered in
equal amounts in each Consultants name. The option term shall be
ten years. The shares to be delivered upon exercise of the option
shall not be registered under the Securities Act of 1933, as
amended (the "Act") and shall only be eligible for resale subject
to the provisions of Rule 144 as promulgated under the Act or
pursuant to any other available exemptions front registration
under the Act. Notwithstanding the foregoing, it is agreed that
if the Company should elect to register its securities for sale
to the public after one year, that the Company will so notify the
Consultants in writing, after which time Consultant shall have
fifteen (15) days in which to advise the Company as to whether it
wants its shares included in the Registration Statement. The
Consultants agree to be responsible for its counsel fees and
other fees related directly to the inclusion of its shares in any
offering.
(b) X.X. Xxxxxxxxxxx also shall receive a monthly fee on a month to
month basis of $5,000, which fee shall be accrued and shall
become due and payable on first day of each month.
(c) All reasonable out-of-pocket expenses incurred by the Consultants
in the performance of the services to be rendered shall be borne
by the Company.
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6. AVAILABLE TIME. Consultant shall be available at either one of their
offices or at the offices of the Company upon reasonable notice.
7. RELATIONSHIP. Nothing herein shall constitute the appointment of any
Consultant as an employee or agent of the Company except to such an
extent as might hereafter be agreed upon for a particular purpose.
Except as expressly agreed, the Consultant shall not have the
authority to obligate or commit the Company in any manner whatsoever.
8. ADDITIONAL SERVICES BY CONSULTANTS. Nothing herein shall preclude the
engagement by the Company of any one of the Consultants to provide
other services to the Company on such basis as agreed to between the
Company and such Consultant or Consultants.
9. ASSIGNMENT. The parties hereto recognize that the nature of the
services to be offered by the Consultants are personal and that this
agreement may not be assigned by the Consultants to another Company or
individuals, unless otherwise approved in writing by the Company. This
agreement, including obligations under paragraph 4(a) and 4(b) hereof
shall be binding upon the Company and its successors and assigns so
long as the Consultants or its authorized assigns are providing the
services hereunder.
10. CONFIDENTIAL INFORMATION. The Consultants understand that prior to and
during the term of this Agreement, the Company will, from time to
time, make available to the Consultants and its agents, certain
financial, business and other information concerning the Company's
operations and that such information may otherwise come into the
possession of the Consultants. The Consultants acknowledge and agree
that any financial, business and other information. including any
memorandum and/or reports relating to the Company's assets, plans,
research, customers, employees, financial condition and business
activities generally supplied or furnished by the Company to the
Consultants or their agents or which the Consultants may otherwise
obtain shall be confidential. (The foregoing financial, business and
other information including all reports and memoranda shall be
collectively referred to as "Confidential Information".) The
Consultants agree that all Confidential Information furnished or
disclosed to the Consultants or otherwise obtained by them will be
treated as confidential and will not be disclosed or divulged by the
Consultants or their agents and the Consultants will use their best
efforts to prevent disclosure by others of Confidential Information to
third parties without the Company's written consent. The provisions of
this paragraph 8 shall survive the termination of this Agreement.
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11. NOTICES. Any notice to be given hereunder shall be sufficient if in
writing and delivered in person or sent by certified or registered
mail, return receipt requested, addressed as follows:
(a) If to the Company:
Alpha 1 Biomedicals, Inc.
X.X. Xxx 00000
Xxxx Xxxxxxxx, XX 00000-0000
(b) If to the Consultants:
Xxxxxxx X. Xxxxxx
0000 Xxxxxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxxxx, XX 00000
Xxxxxx X. Silver
0000 Xxx Xxxx Xxxxxx, X.X.
Xxxxxxxxxx, XX 00000
X.X. Xxxxxxxxxxx
0000 Xxxxxxx Xxxx Xxxx
Xxxxxxxx, XX 00000
Xxxxx X. Xxxxxxxxx
000 00xx Xxxxxx, X.X.
Xxxxxxxxx 0000
Xxxxxxxxxx, XX 00000
Either party may change the address for such party herein set forth by
giving like notice of such change to the other party.
12. ENTIRE AGREEMENT. This Agreement contains all the understandings and
representations between the parties hereto pertaining to the subject
matter hereof and supersedes all undertakings and agreements, if any,
whether oral or in writing, previously entered into by them with
respect thereto.
13. AMENDMENT OR MODIFICATION; WAIVER. No provision of this Agreement may
be amended or waived unless such amendment or waiver is agreed to in
writing by the parties hereto.
14. SEVERABILITY. If any provision of this Agreement shall be determined
by a court of competent jurisdiction to be invalid or unenforceable,
the remaining provisions of this Agreement shall be unaffected thereby
and shall remain in full force and effect to the fullest extent
permitted by law.
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15. This Agreement shall be construed and enforced in accordance with the
laws of the State of Maryland.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the 16th of August 1999.
ALPHA 1 BIOMEDICALS, INC.
By: /s/ Xxxxxx Xxxxxxxxx
-------------------------
XXXXXX XXXXXXXXX
Secretary-Treasurer
/s/ Xxxxxxx X. Xxxxxx
--------------------------
XXXXXXX X. XXXXXX
/s/ Xxxxxx X. Silver
--------------------------
XXXXXX X. SILVER
/s/ X. X. Xxxxxxxxxxx
--------------------------
X.X. XXXXXXXXXXX
/s/ Xxxxx X. Xxxxxxxxx
--------------------------
XXXXX X. XXXXXXXXX
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