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EXHIBIT 10.46
CONSULTING SERVICES AGREEMENT
BETWEEN
ILEX ONCOLOGY, INC.
AND
XXXXXX XXX XXXX, M.D.
THIS AGREEMENT is made and entered into as of the 1st day of January,
1995 (the "Effective Date") by and between Ilex Oncology, Inc., a Delaware
corporation ("Ilex Oncology"), and Xxxxxx Xxx Xxxx, M.D., an individual
residing in San Antonio, Texas ("Xx. Xxx Xxxx").
IN CONSIDERATION of the mutual agreements herein contained and other
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, it is agreed as follows:
1.0 Engagement. Ilex Oncology hereby engages Xx. Xxx Xxxx to
serve as a consultant to Ilex Oncology, and Xx. Xxx Xxxx hereby accepts such
engagement, upon and subject to the terms and conditions set forth herein. Xx.
Xxx Xxxx currently serves as Director of the Institute for Drug Development
("IDD"), a division of the CTRC Research Foundation, and as a consultant to
other pharmaceutical companies. To the extent that those engagements require
approvals for this agreement, Xx. Xxx Xxxx shall be primarily responsible for
securing the same, with the assistance of Ilex Oncology. This agreement is
expressly conditional upon obtaining such approvals, and shall terminate if
such approvals cannot be obtained within a reasonable period of time after the
Effective Date.
2.0 Affiliations. From and following the Effective Date of this
Agreement, Xx. Xxx Xxxx shall not undertake any further affiliations that would
conflict with his duties and responsibilities hereunder without Ilex Oncology's
written consent, which consent shall not be unreasonably withheld. Xx. Xxx
xxxx shall, upon execution of this agreement, disclose to Ilex Oncology all
consulting engagements of Xx. Xxx Xxxx and disclose all new consulting
engagements of Xx. Xxx Xxxx which are undertaken during the term of this
agreement. Such disclosures shall be made in writing to the President of Ilex
Oncology.
3.0 Duties. Xx. Xxx Xxxx agrees to provide the services set forth
on Exhibit A which is incorporated herein for all purposes. The parties
understand and acknowledge that potential conflicts or duality of interest, or
the appearance of such conflict or duality of interest, may arise during Xx.
Xxx Xxxx'x performance of those duties and services as a result of Xx. Xxx
Xxxx'x other affiliations. Both parties recognize the importance of avoiding
both actual conflicts and the appearance of
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conflicts of interest. The parties will therefore mutually develop procedures
for identifying and evaluating actual, potential and apparent conflicts of
duality of interests, as well as procedures for ensuring strict compliance with
all applicable conflicts of interest laws, rules, regulations and policies
adopted by the Cancer Therapy and Research Foundation of South Texas (and its
affiliated entities), and other interested institutions, companies or concerns.
In discharging his duties and responsibilities hereunder, Xx. Xxx Xxxx will
advise Ilex Oncology when and if an actual or potential conflict arises. The
parties will then mutually work at attempting to resolve the conflict. If a
resolution is not possible, Xx. Xxx Xxxx shall be excused from performing
whatever duties or services which gave rise to the actual, potential or
apparent conflict.
4.0 Compensation. Compensation for Xx. Xxx Xxxx'x services shall
be in accordance with Exhibit B, which is attached hereto and incorporated
herein for all purposes.
5.0 Independent Contractor. The parties understand and
acknowledge that Xx. Xxx Xxxx is an independent contractor and is not an
employee of Ilex Oncology for the purposes of this Agreement, the Social
Security Act, the income withholding provision of the Internal Revenue Code of
1986, as amended, or other federal or state laws relating to compensation,
insurance, unemployment, or xxxxxxx'x compensation. Xx. Xxx Xxxx acknowledges
and agrees that it shall be his obligation to report as self-employment income
all compensation received or accrued as a result of this Agreement. Xx. Xxx
Xxxx acknowledges that he will not be entitled to any insurance, pension,
profit sharing, retirement or other employee benefits which Ilex Oncology may
provide to its employees during the term of this Agreement. This Agreement
shall not be construed as creating a partnership, joint venture, agency or
employment relationship, or as granting a franchise under either federal or
state law.
6.0 Inventions. The parties acknowledge that the terms of Xx. Xxx
Xxxx'x affiliation with other companies and institutions may require, to
varying degrees and under certain conditions, that Xx. Xxx Xxxx assign his
rights to any discoveries, inventions or developments to such companies and
institutions. In the performance of his duties and responsibilities hereunder,
Xx. Xxx Xxxx may conceive, make or develop products, processes or other
intellectual property. It is the intent of the parties that intellectual
property conceived, made or developed by Xx. Xxx Xxxx during the performance of
his duties and responsibilities hereunder that relates to Ilex Oncology's
business, or that is conceived, made or developed using Ilex Oncology's funds,
facilities, materials or information, shall be owned by Ilex Oncology. Xx. Xxx
Xxxx will use his best good faith efforts to ensure that his obligations under
affiliations with other companies or institutions do not extend to intellectual
property rightfully owned by Ilex Oncology. Xx. Xxx Xxxx will assist Ilex
Oncology in obtaining legal protection for such intellectual property as part
of his duties and responsibilities hereunder, and will execute such documents
as reasonably necessary to secure such protection and confirm ownership in Ilex
Oncology. The parties will develop procedures for identifying any potentially
conflicting claims to such intellectual property. In the event of such
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potentially conflicting claims, the parties will mutually cooperate in
resolving such conflicts.
7.0 Confidential Information. Xx. Xxx Xxxx agrees to maintain in
confidence all information and materials provided by, or obtained from or
through, Ilex Oncology including, without limitation, all information regarding
drugs; pharmaceuticals; gene manipulations and/or therapy; products, compounds
and compositions resulting from chemical, rDNA, genetic engineering or other
methods; potential new uses of existing drugs, compounds or compositions;
medical devices; and all financial information, computer software and
documentation; and other information relating to the business of Ilex Oncology
(collectively, the "Confidential Information"). Xx. Xxx Xxxx shall not
publish, use or disclose Confidential Information learned, developed or
acquired as a result of services offered under this Agreement without Ilex
Oncology's prior written consent. Confidential Information shall not include
(i) information which was rightfully in Xx. Xxx Xxxx'x possession without an
obligation of confidentiality prior to disclosure by or through Ilex Oncology;
(ii) information which lawfully becomes part of the public knowledge,
literature or generally available to the public through no act of Xx. Xxx Xxxx;
or (iii) information obtained from any third party, provided that any such
third party did not obtain such information from Ilex Oncology or obtain such
information in confidence. Xx. Xxx Xxxx shall protect the Confidential
information and shall take all reasonable steps to prevent the unauthorized
disclosure, dissemination, or publication of the Confidential Information.
All data, records, analyses, reports and material prepared or complied
by Xx. Xxx Xxxx or furnished to Xx. Xxx Xxxx, in connection with this Agreement
during the term hereof shall be the sole and exclusive property of Ilex
Oncology, and all of such data, records, analyses, reports and materials, and
all copies thereof, shall be delivered to Ilex Oncology at its request or on
the termination of this Agreement.
The parties acknowledge that the terms of Xx. Xxx Xxxx'x other
affiliations also contain or require certain obligations of confidentiality.
In discharging his duties relative to Confidential Information, Xx. Xxx Xxxx
shall advise ilex Oncology when and if an actual or potential conflict with
such other obligations arise. The parties will then mutually work at
attempting to resolve the conflict. If such conflict cannot be resolved, Xx.
Xxx Xxxx is expressly excused from performing any services hereunder that would
result in a breach or potential breach of his confidentiality obligations owed
to another entity.
8.0 Term and Termination.
8.1 Term. Subject to the rights of termination set forth in this
Section 8.0, this Agreement shall remain in full force and effect from January
1, 1995 until December 31, 1998, unless sooner terminated by Xx. Xxx Xxxx'x
death or continuing inability to discharge the duties hereunder for three (3)
consecutive months. Ninety (90) days prior to the end of the term of this
Agreement, the parties shall enter into negotiations regarding the renewal of
this Agreement or the execution of a new
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agreement, which renewal or new agreement shall contain such terms and
conditions as may be agreed by the parties.
8.2 Voluntary Termination. During the term of this Agreement,
either party may terminate the Agreement without cause, by giving sixty (60)
days written notice of termination to the other party.
8.3 Termination With Cause. In the event of breach of this
agreement by either party, the non-breaching party may, at its option, cancel
this agreement for such breach by giving written notice of cancellation to the
breaching party, which cancellation shall be effective thirty (30) days
following the delivery of such notice or such later time as may be specified in
such notice, unless the breaching party shall have cured such breach prior to
the expiration of the notice.
8.4 Limited Survival Upon Termination. Sections 6 and 7 shall
survive termination of this Agreement and shall remain in full force and
effect.
9.0 Miscellaneous.
9.1 Notices. All notices, requests, demands, and other
communications hereunder shall be in writing and, unless otherwise provided
herein, shall be deemed to have been duly given upon hand delivery or upon
deposit in the United States Mail, postage prepaid, certified or registered
mail, return receipt requested, as follows:
If to Ilex Oncology:
Ilex Oncology, Inc.
14960 Omicron
Xxx Xxxxxxx, Xxxxx 00000
Attention: Xxxxxxx X. Love
If to Xx. Xxx Xxxx:
Xxxxxx Xxx Xxxx, M.D.
000 Xxxxxx Xxx Xxx
Xxx Xxxxxxx, Xxxxx 00000
or at such other address as shall have been furnished to the other in writing
in accordance herewith, except that such notice of such change shall be
effective only upon receipt.
9.2 Amendments and Waiver. This Agreement may be amended or
modified by, and only by, a written instrument executed by all the parties
hereto. The terms of this Agreement may be waived by, and only by, a written
instrument executed by the party against whom such waiver is sought to be
enforced.
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9.3 Section and Other Headings. The section and other headings
contained in this Agreement are for convenience of reference only and shall not
in any way affect the meaning or interpretation of this Agreement.
9.4 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of which shall
constitute one and the same instrument.
9.5 Assignments and Parties in Interest. This Agreement shall
inure to the benefit of and be binding upon the parties hereto and their
respective successors and assigns. This Agreement calls for Xx. Xxx Xxxx'x
personal services and may not be assigned by Xx. Xxx Xxxx without the prior
written consent of Ilex Oncology.
9.6 No Implied Rights or Remedies. Except as otherwise expressly
provided herein, nothing herein expressed or implied is intended or shall be
construed to confer upon or to give any person, firm, or corporation, other
than the parties hereto and their respective successors and assigns, any rights
or remedies under or by reason of this Agreement.
9.7 Agreement of Further Cooperation. Each of the parties agrees
to execute and deliver such further documents and to cooperate in such manner
as may be necessary to implement and give effect to the agreements contained
herein.
9.8 Entire Agreement. This Agreement, together with all exhibits
hereto, embodies the entire agreement and understanding between the parties
hereto relating to the subject matter hereof and supersedes any prior
agreements and understandings relating to the subject matter hereof.
9.9 Severability. If any part or provision of this Agreement is
or shall be deemed violative of any applicable laws, rules or regulations, such
legal invalidity shall not void this Agreement or affect the remaining terms
and provisions of this Agreement, and this Agreement shall be construed and
interpreted to comport with all such laws, rules or regulations to the maximum
extent possible.
9.10 Applicable Law. This Agreement has been accepted and made
performable in Bexar County, Texas. This Agreement and the rights and
obligations of the parties hereto shall be construed under and governed by the
laws of the State of Texas, without giving effect to principles of conflict of
laws. The exclusive venue for resolution of any dispute between the parties
related to the subject matter of this Agreement shall be in Bexar County,
Texas.
9.11 IRS Contingency. Notwithstanding anything contained herein to
the contrary, Ilex Oncology and Xx. Xxx Xxxx agree that they shall negotiate in
good faith to reach an equitable adjustment to the provisions of this Agreement
in the event that either (a) the United State Internal Revenue Service notifies
the Cancer Therapy and Research Foundation of South Texas ("CTRF") and/or CTRC
Research Foundation
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("CTRC"), or any affiliate thereof that it will not rule that the establishment
and operation of Ilex Oncology will not adversely affect CTRF's, CTRC's or any
such affiliate's status as an exempt organization under Section 501(c)(3) of
the Internal Revenue Code, or the Internal Revenue Service otherwise asserts
that the establishment and operation of Ilex Oncology may adversely affect
CTRF's, CTRC's or any such affiliate's status as an exempt organization under
Section 501(c)(3) of the Internal Revenue Code; or (b) Ilex Oncology fails to
receive at least three million dollars ($3,000,000) by June 30, 1996 from the
sale to persons other than CTRF, CTRC and their affiliates of its common or
preferred stock. If Ilex Oncology and Xx. Xxx Xxxx cannot reach such an
agreement within ninety (90) days subsequent to the occurrence of such an
event, this Agreement shall automatically terminate as of the expiration of
that ninety (90) day period.
EXECUTED as of the day and year first above written.
ILEX ONCOLOGY, INC.
By: /s/ XXXXXXX XXXX
-----------------------------------------
Name: Xxxxxxx Xxxx
---------------------------------------
Title: President
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CONSULTANT:
/s/ XXXXXX XXX XXXX
--------------------------------------------
Xxxxxx Xxx Xxxx, M.D.
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EXHIBIT A
DUTIES AND SERVICES
1.0 Consultation Services. Xx. Xxx Xxxx shall perform the
following services for Ilex Oncology.
1.1 Scientific Advisory Committee. Xx. Xxx Xxxx shall
organize for the benefit of Ilex Oncology a Scientific Advisory Committee (the
"SAC") which shall be composed of such persons as may be appointed by Ilex
Oncology in consultation with Xx. Xxx Xxxx. The SAC shall be organized and
operate pursuant to a policy developed by Xx. Xxx Xxxx and approved by Ilex
Oncology. The SAC shall hold at least four (4) meetings per year, at such time
and place as designated by the SAC.
1.2 Committee Co-Chairman. Xx. Xxx Xxxx shall be a
member of the SAC and serve as co-chairman of the committee. Xx. Xxx Xxxx
shall attend all meetings of the SAC and in accordance with the terms of this
Agreement report to Ilex Oncology the action and recommendations of the SAC.
1.3 Drug Acquisition. Xx. Xxx Xxxx shall, consistent
with the terms of this Agreement and in collaboration with the SAC, advise the
management of Ilex Oncology of viable opportunities for Ilex Oncology to
acquire for the purpose of commercialization chemotherapy compounds and drugs
as well as other therapeutic or supportive care compounds.
1.4 Clinical Development Strategies. Xx. Xxx Xxxx shall,
consistent with the terms of this Agreement and as part of his duties with the
SAC, assist Ilex Oncology in the development of clinical development
strategies.
1.5 Scientific Review. In conjunction with the SAC, Xx.
Xxx Xxxx shall review scientific and clinical data on compounds acquired by
Ilex Oncology. As co-chairman of the SAC, Xx. Xxx Xxxx shall report to the
management of Ilex Oncology the results of the SAC findings and recommendations
relative to such compounds.
1.6 Presentations. Xx. Xxx Xxxx shall, consistent with
the terms of this Agreement, make presentations for and on behalf of Ilex
Oncology to potential financial investors regarding Ilex Oncology's portfolio
of compounds provided that such presentations shall include an appropriate
disclosure of Xx. Xxx Xxxx'x financial relationship with Ilex Oncology.
2.0 Requisites. In providing services under this Agreement, Xx.
Xxx Xxxx shall at all times perform his duties and responsibilities in
conformance with the following requisite standards of conduct:
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2.1 Xx. Xxx Xxxx shall not make any recommendations
about, or actively participate in decisions regarding the acquisition of
technologies or compounds owned or discovered by or licensed to the Institute
for Drug Development ("IDD"), when such actions would constitute a conflict of
interest, give the appearance of a conflict of interest or a breach of any
policy of IDD or Ilex Oncology.
2.2 Xx. Xxx Xxxx shall not make an recommendations about,
or actively participate in decisions regarding the acquisition of technologies
or compounds for which Xx. Xxx Xxxx was the Principal Investigator, supervised
the Principle Investigator or provided leadership for the clinical or
preclinical studies for such compounds or technologies, when such actions would
constitute a conflict of interest, give the appearance of a conflict of
interest or a breach of any policy of Ilex Oncology or the sponsor of the
study.
2.3 Xx. Xxx Xxxx shall not function as the Principal
Investigator for or supervise the Principal Investigator or clinical or
preclinical studies conducted by Ilex Oncology.
2.4 If Xx. Xxx Xxxx publishes an article, paper or other
work regarding technologies or compounds owned or discovered by Ilex Oncology
or licensed to Ilex Oncology, Xx. Xxx Xxxx shall make an appropriate disclosure
of the fact that he has a financial interest in the company.
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EXHIBIT B
COMPENSATION
1. Ilex Oncology shall pay to Xx. Xxx Xxxx the following fees for Xx. Xxx
Xxxx'x services:
a. A retainer of fifteen thousand dollars ($15,000.00) per year,
which shall be paid within thirty (30) days of the execution
of this Agreement and on the anniversary thereof;
b. Two thousand dollars ($2,000.00) per day for every full day in
which services are provided pursuant to this Agreement and for
partial days, Xx. Xxx Xxxx shall be compensated at the rate of
two hundred fifty dollars ($250.00) per hour; and
c. Two thousand dollars ($2,000.00) per meeting for attending
meetings of the SAC.
2. a. Right to Purchase Common Stock. In addition to the fees
described above, Xx. Xxx Xxxx shall be entitled, for a period
of thirty (30) days from the date of this Agreement, to
purchase up to 640,000 shares (the "Shares") of common stock,
par value $.01 per share, of Ilex Oncology at a price of $.10
per share (the "Purchase Price").
b. Financing. Ilex Oncology will loan Xx. Xxx Xxxx up to
sixty-four thousand dollars ($64,000.00) for the purchase of
the Shares. Such loan will be evidenced by a promissory note
(the "Note") and related agreements as required by Ilex
Oncology. The Note will bear interest at a rate of eight
percent (8%) simple interest per annum (i.e. not compounded)
(the "Agreed Rate") and will be payable in quarterly
installments based upon a ten (10) year amortization schedule
and will mature on the fourth anniversary of this Agreement.
The Note shall be secured by a pledge of that number of Shares
basis determined by dividing the outstanding principal balance
of the Note by the per share purchase price of the Shares
(e.g. if the Note balance is $20,000, the number of Shares
pledged would be 200,000), with a mechanism for partial
releases of pledged shares to reflect reductions in the unpaid
balance of the Note on the same basis.
c. Restrictions on Shares. Xx. Xxx Xxxx'x ownership of the
Shares shall be subject to the following restrictions, in
addition to restrictions on transfer that might be imposed by
applicable state or federal securities laws.
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(1) For a period of four (4) years from the date Xx. Xxx
Xxxx purchases the Shares (the "Purchase Date"), Xx.
Xxx Xxxx shall not sell, transfer, pledge or
otherwise dispose of or encumber the Shares, or any
of them, other than as provided in this Agreement.
(2) In the event this Agreement is terminated pursuant to
Section 9.11 of the Agreement, during the term hereof
for cause by Ilex Oncology or without cause by Xx.
Xxx Xxxx, Ilex Oncology shall have the right, but not
the obligation, to purchase the Shares from Xx. Xxx
Xxxx; provided, however, that the number of Shares to
which such right to purchase applies shall be reduced
by 25% for each year of the term hereof which has
been completed as of the effective date of such
termination (the "Termination Date"). For example,
if three years have been completed under this
Agreement as of the Termination Date, Ilex Oncology
shall have the right to purchase a number of Shares
equal to 25% of the number of Shares originally
purchased by Xx. Xxx Xxxx pursuant to this Agreement.
the price per share to be paid by Ilex Oncology for
any Shares purchased by it pursuant to this paragraph
shall be equal to the Purchase Price plus interest at
the Agreed Rate from the Purchase Date through the
Termination Date.
3. Stock Option.
a. As additional compensation for services rendered under this
Agreement, Ilex Oncology shall grant to Xx. Xxx Xxxx an
option to acquire up to a certain number of shares of common
stock ("Common Stock") of Ilex Oncology. The exercise price
of the option shall be equal to the Common Stock equivalent
purchase price per share of equity securities (anticipated to
be preferred stock) issued by Ilex Oncology pursuant to its
initial private placement or other offering which results in
gross proceeds to Ilex Oncology in excess of $3 million. The
number of shares of Common Stock covered by the option shall
be equal to $100,000 divided by the Common Stock equivalent
purchase price per share applicable to such offering (for
example, if the private placement price is $1.50 per share,
Xx. Xxx Xxxx would receive an option to acquire up to 66,667
shares). The option shall vest over four (4) years as
follows: 25% on the first anniversary of this Agreement, 25%
on the second anniversary of this Agreement, 25% on the third
anniversary of this Agreement, and 25% on the fourth
anniversary of this Agreement. All options must be exercised
upon the later of (i) the fifth year anniversary of this
Agreement, (ii) one year subsequent to the termination of
employment, for any reason, from Ilex Oncology, or (iii) one
year subsequent to the termination of the "lock-up period"
that is negotiated by Ilex Oncology and its underwriters in
connection with an initial public offering of Ilex Oncology's
Common Stock (the "Option Term"). The option will be granted
contemporaneously with the
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completion of such initial private placement or other offering
pursuant to a separate instrument which shall make reference
to the provision of this Agreement.
b. The stock option issued to Xx. Xxx Xxxx pursuant to this
Section shall be consistent with Ilex Oncology's stock option
plan (the "Plan") to be adopted for key employees of Ilex
Oncology. Accordingly, Xx. Xxx Xxxx shall have the following
rights relating to termination of this Agreement pursuant to
the provisions of Article 8:
(1) In the event of termination by Ilex Oncology without
cause under Section 8.2; (i) outstanding stock
options held by Xx. Xxx Xxxx which are then vested
shall remain exercisable for the Option Term, (ii)
if, within ten (10) days of such termination, Xx. Xxx
Xxxx notifies Ilex Oncology that he is making an
election under this Section, outstanding stock
options held by Xx. Xxx Xxxx which would vest within
one year from the date of termination shall
automatically become vested and remain exercisable
for the Option Term, and (iii) after giving effect to
any accelerated vesting under clause (ii) above, any
then unvested portion of Xx. Xxx Xxxx'x outstanding
stock options shall lapse.
(2) In event of termination by Ilex Oncology for "cause"
under Section 8.3, upon death or disability of Xx.
Xxx Xxxx or by Xx. Xxx Xxxx pursuant to a voluntary
resignation under Section 8.2, (i) any portion of Xx.
Xxx Xxxx'x outstanding stock options which are vested
as of the date of termination shall remain
exercisable for the Option Term, and (ii) any then
unvested portion of Xx. Xxx Xxxx'x outstanding stock
options shall lapse.
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