Exhibit 10.9
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT ("Agreement") is made as of this September
12, 2000 by and between Magainin Pharmaceuticals Inc., a Delaware corporation
(the "Company") and Xx. Xxxxxxx Xxxxxxx ("Consultant").
WHEREAS, Consultant has served as Executive Vice President of the
Company;
WHEREAS, by mutual consent Consultant's employment with the Company as
Executive Vice President will be terminated as of 5:00 p.m., Philadelphia time,
on September 12, 2000 (the "Effective Date");
WHEREAS, the parties hereto desire to enter into this Agreement on the
date hereof to set forth their agreement with respect to said termination of
employment and to provide for the retention by the Company of Consultant after
the Effective Date as a consultant to the Company and for certain other matters
in connection therewith upon the terms and conditions hereinafter set forth.
NOW THEREFORE, in consideration of the covenants and conditions set
forth in this Agreement, the parties, intending to be legally bound, agree as
follows:
1. Termination of Employment. Consultant hereby voluntarily and
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irrevocably resigns as an officer and employee of the Company and as an officer
and employee of each subsidiary and affiliate of the Company of which he is an
office or employee, in each case as of the Effective Date. The Company and
Consultant acknowledge and agree that all rights and obligations of any nature
of the Company and Consultant with respect to such employment or positions shall
be duly and effectively terminated on the Effective Date, except as expressly
provided below. Consultant further acknowledges and agrees that payments made or
to be made and benefits provided or to be provided hereunder are in lieu of any
and all compensation and benefits of any nature whatsoever due to Consultant
under the terms of any agreement, arrangement or understanding (whether written
or oral) binding upon the Company and Consultant.
1.1 Continuation as a Director. Until the election and qualification
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of his successor, or until his earlier death, removal or resignation, Consultant
shall continue to serve as a member of the Board of Directors; however,
Consultant shall no longer be Vice Chairman of the Company.
2. Consulting Arrangement. The Company hereby retains Consultant as
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a consultant to the Company to perform the consulting services in accordance
with the terms and conditions hereinafter set forth.
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2.1 Term. The period during which consulting services shall be provided
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under this Agreement (the "Consulting Term") shall begin on the Effective Date
and end on the first anniversary thereof, subject to the provisions for earlier
termination thereof set forth in Section 5 of this Agreement.
2.2 Duties and Responsibilities as a Consultant. During the Consulting
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Term, Consultant shall provide consulting services to the Company as an
independent contractor and not as an employee of the Company. Consultant shall
at all times during the Consulting Term act as an independent contractor and
during such period nothing hereunder shall create or imply a relationship of
employer-employee between the Company and Consultant. Consultant shall provide
such consulting and advisory services to the Company as may be reasonably
requested from time to time by the chief executive officer of the Company.
Consultant shall have access to a small office for consulting services
to be provided at Magainin, and shall have access to secretarial assistance, as
appropriate. Consultant will continue to have access to the Company's computer
system, and his email address will remain available for use.
2.3 Extent of Service as a Consultant. During the Consulting Term,
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Consultant agrees to devote such time, attention and energy as is necessary to
fulfill his duties and responsibilities as a Consultant under Section 2.2
hereof, but in no event shall Consultant be required to spend more than one day
in any week or more than a total of 52 days during the Consulting Term in such
consulting activities.
2.4 Compensation for Consulting Services.
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(a) Within the period of the Consulting Term, Company shall pay
Consultant the sum of $271,631.72, payable in prorated amounts upon the dates
that the Company regularly pays its senior executives.
(b) Consultant acknowledges that the period within which the Company
will make available the purchase of health insurance under COBRA will commence
as of the Effective Date. Consultant shall not be entitled to any benefits
provided to employees of the Company during the Consulting Term, and, Consultant
specifically acknowledges that he is not entitled to participate in any of the
Company's benefit plans, including, without limitation, the Company's health and
life insurance, disability insurance or 401(k) plans.
(c) Consultant alone, and not the Company, will be solely responsible
for payment of all federal, state and local taxes in respect of the payments to
be made and benefits to be provided to him under this Agreement.
2.5 Stock Options. The Company has previously granted Consultant
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options to acquire a total of 423,000 shares of the Company's common stock (the
"Stock Options") as set forth on Attachment A hereto pursuant to various stock
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option agreements (the "Option Agreements").
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The Company and Consultant hereby acknowledge and agree that (i) the provisions
of the Option Agreements will continue to apply to the Company and Consultant
during the Consulting Term, (ii) during the Consulting Term, Consultant may
exercise the Stock Options as such options have vested, or will vest during the
Consulting Term, in accordance with the terms of the Option Agreements, and
(iii) all provisions of the Option Agreements relating to the period of
employment of Consultant by the Company or its subsidiaries shall instead refer
to the period of Consultant's services as a consultant to the Company during the
Consulting Term.
2.6 Return of Company Property. As soon as possible after the
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Effective Date, Consultant will return to the Company all lists, books, records,
documents, credit cards and other materials or property in his possession,
custody or control which are or were owned by the Company or any of its
subsidiaries or affiliates, or which are or were used by Consultant or any other
officers, employees or agents of the Company or any of its subsidiaries or
affiliates in connection with the conduct of the business of the Company or any
of its subsidiaries or affiliates, except those materials and property agreed
upon by the Company and Consultant to be necessary for the execution of the
Consultant's obligations and responsibilities. Consultant will not deliver to
any other persons or entities copies thereof or permit any copies thereof to be
made by any other person or entity.
3. General Release. In consideration of the foregoing including
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without limitation the promises and payments as described in Section 2 above.
Consultant hereby knowingly, willingly and voluntarily remises, waives, releases
and forever discharges the Company and its subsidiaries and affiliates, the
directors, officers, employees, advisors and agents of the Company and its
subsidiaries and affiliates, and the heirs, executors, administrators,
successors and assigns of such parties (collectively referred to as the
"Releasees") of and from any and all manner of actions and causes of action,
suits, debts, dues, accounts, bonds, covenants, contracts, agreements,
judgments, claims and demands whatsoever in law or equity which Consultant, his
heirs, executors, administrators or assigns has, had or may hereafter have
against the Releasees or any of them from or by reason of any cause, matter or
thing whatsoever from the beginning of his employment with the Company to the
Effective Date, excepting only claims against the Company relating to its
obligations under this Consulting Agreement and including, without in any way
limiting the generality of the foregoing, any and all matters relating to his
employment by the Company and the termination thereof, any and all claims under
any federal, state or local law, any common law claims and all claims for
counsel fees and costs. Consultant covenants and agrees never to commence, aid
in any way, prosecute or permit to be commenced against the Releasees any action
or other proceeding based upon any matters which are the subject of or covered
by the foregoing. Nothing in this Section 3 shall affect or modify in any manner
(i) the rights of Consultant and the obligations of the Company to indemnify
Consultant for acts or matters occurring prior to the Effective Date, if and to
the extent required pursuant to the Company's By-Laws or the Delaware General
Corporation Law, in each case as in effect on or prior to the Effective Date,
and (ii) the rights, if any, of Consultant under any directors and officers
insurance policy purchased by the Company and in effect on or prior to the
Effective Date.
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4. Development and Confidential Information, Etc.
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(a) Consultant acknowledges that he is in possession of
proprietary and confidential of the Company (the "Confidential Information")
received during the period of his employment by the Company. Consultant shall be
under a continuing duty, which duty expressly shall survive the termination of
this Consulting Agreement, to continue to safeguard and not to disclose any of
the Confidential Information, as well as any additional Company Confidential
Information that may come into his possession during the term of this Consulting
Agreement; except, however, that this duty shall not apply with respect to any
information that is in the public domain or that otherwise is disclosed or
enters the public domain through no fault of Consultant.
5. Early Termination of the Consulting Term. The Consulting Term
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shall terminate prior to the first anniversary of the Effective Date upon the
occurrence of any one of the following events:
(a) Death. In the event that Consultant dies during the
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Consulting Term, the Consulting Term shall terminate.
(b) Breach by Consultant. In the event Consultant violates any
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of his obligations under this Agreement, the Company may, upon seven (7) days
prior notice to Consultant, terminate the Consulting Term; provided, however,
that Consultant shall have a reasonable opportunity to cure any breach of his
obligations under Section 2.2, 2.3 or 2.6 of this Agreement during such seven
(7) days' notice period. In the event of a termination pursuant to this Section
5(b), all payment obligations of the Company set forth in this Agreement shall
terminate, and Consultant shall not be entitled to receive any unpaid portion of
the cash payments set forth in Section 2.4(a) of this Agreement.
6. Governing Law. This Agreement shall be governed by and
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interpreted under the laws of the Commonwealth of Pennsylvania, without giving
effect to the principles of conflicts of law thereof.
7. Notices. All notices and other communications required or
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permitted hereunder or necessary or convenient in connection herewith shall be
in writing and shall be deemed to have been given when hand delivered or mailed
by registered or certified mail, as follows (provided that notice of change of
address shall be deemed given only when received):
If to the Company, to:
Magainin Pharmaceuticals Inc.
0000 Xxxxxx Xxxxx
Xxxxxxxx Xxxxxxx, XX 00000
Attention: President and Chief Executive Officer
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With a required copy to:
Xxxxxx, Xxxxx & Bockius LLP
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000-0000
If to Consultant, to:
Xxxxxxx X. Xxxxxxx, M.D., Ph.D.
000 Xxxxxx Xxxx
Xxxxxx, XX 00000
With a required copy to:
Xxxxx X. Xxxxxxxxxxx, Esquire
Xxxxxxxxxxx & Associates, P.C.
000 Xxxxxxxx Xxxx
Xxxx Xxxx, XX 00000-0000
or such other names or addresses as the Company or Consultant, as the case may
be, shall designate by notice to each other person entitled to receive notices
in the manner specified in this Section.
8. Contents of Agreements; Amendment and Assignment.
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(a) Except as stated herein, this Consulting Agreement
supersedes all prior agreements between the parties, including, without
limitation, the Employment Agreement between the parties dated February 22,
1988, as amended on June 22, 1992, and sets forth the entire understanding
between the parties with respect to the subject matter hereof. The Consulting
Agreement may not be modified except as set forth in a writing executed by a
duly authorized officer of the Company and by Consultant.
(b) All of the terms and provisions of this Agreement shall be
binding upon and inure to the benefit of and be enforceable by the respective
heirs, executors, administrators, legal representatives, successors and assigns
of the parties hereto, except that the duties and responsibilities of Consultant
hereunder are of a personal nature and shall not be assignable or delegable in
whole or in part by Consultant and the Company may not transfer or convey its
rights hereunder to any third party other than an affiliate of the Company
without the prior express written consent of Consultant.
9. Severability. Should any provision of this Consulting Agreement,
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or the application thereof to any person or circumstance, be deemed invalid or
unenforceable in any
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jurisdiction then, to the extent that no essential purpose of this Consulting
Agreement is thereby frustrated, the remainder of it shall not be affected
thereby.
10. Remedies Cumulative; No Waiver. No remedy conferred upon the
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Company by this Agreement is intended to be exclusive of any other remedy, and
each and every such remedy shall be cumulative and shall be in addition to any
other remedy given hereunder or now or hereafter existing at law or in equity.
No delay or omission by the Company in exercising any right, remedy or power
hereunder or existing at law or in equity shall be construed as a waiver
thereof, and any such right, remedy or power may be exercised by the Company
from time to time and as often as may be deemed expedient or necessary by the
Company in its sole discretion.
11. Miscellaneous. All section headings are for convenience only.
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This Consulting Agreement may be executed in counterparts, each of which is an
original. It shall not be necessary in making proof of this Consulting Agreement
or any counterpart hereof to produce or account for any of the other
counterparts.
12. Consultation with Legal Counsel, Etc. Consultant and Company
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acknowledge that no promise or inducement for this Agreement has been made
except as set forth herein. Consultant acknowledges that this Agreement is
executed without Consultant's reliance upon any statement or representation by
or on behalf of the Company; that Consultant has had an opportunity to discuss
this Agreement with his attorney; and that Consultant is legally competent to
and does voluntarily execute this Agreement and accept full responsibility
therefore.
13. Formation of New Company. In the event Consultant shall determine
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in the future to form a company to engage in research, development and
commercialization efforts relating to isoleucine and/or MSI-1436 ("NEWCO"),
Consultant and the Company shall discuss in good faith a potential relationship
between NEWCO and the Company, including the licensing of intellectual property
by the Company to NEWCO, and the participation in NEWCO by the Company as an
equity holder.
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IN WITNESS WHEREOF, the undersigned, intending to be legally bound, have
executed this Agreement as of the date and year first above written.
MAGAININ PHARMACEUTICALS INC.
Dated: September 12, 2000 By: /s/ Xxxxxxx X. Xxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxx
Title: President and Chief Executive Officer
CONSULTANT
Dated: September 12, 2000 By: /s/ Xxxxxxx X. Xxxxxxx
Name: Xxxxxxx X. Xxxxxxx, M.D., Ph.D.
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