EXHIBIT 10.7
CONSULTING AGREEMENT
(Schinazi)
CONSULTING AGREEMENT dated as of June 12, 1998 by and between Novirio
Pharmaceuticals, Inc., a Massachusetts corporation with a mailing address c/o
MPM Asset Management, LLC, Xxx Xxxxxxxxx Xxxxxx, 0xx Xxxxx, Xxxxxxxxx, XX 00000
(the "Company"), and Xxxxxxx X. Xxxxxxxx, with a mailing address
at_______________ ("Consultant").
RECITALS
A. The Company has been formed to engage in the business of development
and commercialization of pharmaceuticals for the treatment of human viral
diseases (the "Business").
B. The Company desires to engage Consultant to provide services to the
Company and Consultant desire to provide such services to the Company as set
forth in this Agreement.
C. In connection therewith, Consultant and the Company mutually desire
to enter into this Agreement effective as of the date hereof, which will govern
all work performed for the Company.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and Consultant hereby
agrees as follows:
1. Term. Company agrees to engage Consultant, and Consultant agrees to
accept such engagement, to provide advisory, consulting and other services to
the Company on the terms and conditions hereinafter provided, commencing as of
the date hereof (the "Engagement Date") and terminating on June 12, 2002 (the
"Initial Term"), unless terminated sooner pursuant to Section 8 hereof. Prior to
the expiration of the Initial Term, the Consulting Agreement may be renewed by
mutual agreement of the Company and the Consultant for one or more successive
one-year periods (such successive periods, with the Initial Term, are referred
to as the "Term").
2. Services. Consultant shall provide consulting, advisory and other
services in the Business including, without limitations, (a) performing the
functions described on Exhibit A hereto, (b) assisting the Company in the
preparation and filing of patent applications; (c) assisting with the
development and research of products and potential products for the Business;
and (d) such other responsibilities as the Company and the Consultant may agree
(the "Services").
3. Compensation and Expenses.
(a) Compensation. During the Term, the Company shall pay
Consultant the $25,000 per year, payable quarterly in arrears, commencing June
1, 1998.
(b) Business Expenses. During the Term, the Company shall
reimburse Consultant for all reasonable and necessary expenses incurred by
Consultant in the furtherance of or in connection with the business of the
Company, including, without limitation, travel, board, lodging, telephone and
postage, in accordance with the Company policy then in effect. In order to
obtain reimbursement, Consultant shall submit to the Company an itemized
statement of such expenses along with copies of bills and receipts.
4. Non-Competition; Non-Solicitation. Except as otherwise provided in
this Section 4, at all times during the Term, and for a period of eighteen (18)
months thereafter, Consultant shall not:
(a) Serve as an executive officer of a company engaged in the
Business (other than positions currently held by Consultant);
(b) induce or attempt to induce any customer, dealer or
distributor of the Company to reduce such customer's, dealer's or distributor's
business with the Company; or
(c) solicit any of the Company's consultants or employees to
leave the employ of the Company or hire or cause to be hired any person who was
during or for six (6) months after the termination of Consultant's engagement by
the Company, a consultant or employee of the Company.
The above restrictions shall not be deemed to prohibit Consultant from
(i) taking a position as a faculty member with any university, college, hospital
or other research, treatment or teaching based nonprofit institution, or (ii)
maintaining any position set forth on Exhibit B hereto, or from any activities
undertaken in such position.
5. Covenants of Consultant. Consultant shall provide expertise in the
area of drug resistance, cross-resistance, ways to overcome resistance, the
design of combination trials and virological issues in general. He also agrees
to use his best efforts to facilitate the license by the Company from Pharmasset
of inventions, improvements, modifications, discoveries, creations, methods,
processes and developments in the Business which are made or conceived by
Consultant alone or with others during the Term.
-2-
6. Confidentiality. During the course of his engagement with the
Company, Consultant may have access to, learn of, or participate in the
development of the Company's confidential information or confidential
information entrusted to the Company by other persons, corporations, or firms.
The Company's confidential information includes matters not generally known
outside of the Company, such as know-how, trade secrets, experimentation,
research and developments relating to existing and future products and services
to be or being marketed or used by the Company (whether or not such products or
services are actually realized or pursued by the Company), and also any
information which gives the Company a competitive advantage including, without
limitation, data relating to the general business operations of the Company
(e.g., sales, costs, profits, organizations, customer lists, pricing methods,
etc.). Confidential information shall not include information that may be
demonstrated by Consultant to have been known by Consultant prior to the date
hereof or which is otherwise disclosed to the Consultant by a third party who is
not under any confidentiality obligation preventing such disclosure. Consultant
agrees to hold such information as strictly confidential and not disclose any
such confidential information to any person, corporation or firm (other than the
Company). Consultant further agrees not to make use of such confidential
information except on the Company's behalf whether or not such information is
produced by his own efforts. These restrictions shall apply to all such
information whether written, oral, magnetic, optical or in some other form.
Consultant understands and agrees that his confidentiality obligations under
this Section 6 shall continue both during his engagement and after termination
of his engagement until such confidential information becomes generally
available to the public through legitimate means. It is understood and agreed
that specific information which Consultant may receive, observe, perceive,
create, develop or learn while a consultant to the Company shall not be deemed
to be generally available to the public merely because such specific information
is embraced by more general information which is generally available to the
public.
7. Return of Information. At the end of the Term or at any time upon
the request of the Company, Consultant agrees to deliver to the Company all
records, drawings, notebooks, documents, computer disks and tapes and other data
in any and all forms which pertain to the Company's confidential information
(whether prepared by Consultant or others), and also to return to the Company
any equipment, tools, computers or other devices owned by the Company and in his
possession, provided however that the Consultant shall have the right to retain
one copy of such materials for his personal records (but in any event not to be
used in a manner inconsistent with the terms of this Agreement). Consultant
agrees that the above documents, data and devices are the exclusive property of
the Company and shall not be copied or removed from the Company premises except
in the pursuit of the business of the Company.
-3-
8. Representations and Covenants.
(a) Consultant will not disclose to the Company, or induce the
Company to use, any confidential information of other persons, corporations, or
firms including his present or former employers (if any).
(b) Set forth on Exhibit B hereto is a list of all educational
institutions, companies, governmental entities and individuals with whom
Consultant has current representative, consultant, employment, business
partnership or similar relationships or of which Consultant owns greater than 5%
of the outstanding voting securities, and a description of all agreements with
such parties. Consultant shall notify the Company in writing promptly whenever
there are changes to this list.
(c) Consultant is responsible for ensuring that the
relationships set forth on Exhibit B hereto will not result, with the passage of
time or the giving of notice, or both, in a default under the terms of this
Agreement.
(d) Consultant represents that he has not been debarred nor
received notice of any action, or threat with respect to its debarment under the
provisions of the Generic Drug Enforcement Act of 1992, 21 U.S.C. Section
335(a). Consultant agrees promptly to notify the Company upon receipt of any
such notice and further agrees, upon the Company's request, to provide a
separate written certification, on a form provided by the Company, to this
effect.
9. Termination of Engagement. Notwithstanding the provisions of Section
1, Consultant's engagement hereunder shall terminate under the following
circumstances:
(a) Death or Disability. Consultant's engagement hereunder
shall immediately terminate upon his death or disability (as hereinafter
defined). For purposes of this Agreement, Consultant shall be deemed disabled if
in the opinion of the Board of Directors of the Company, determined in good
faith, Consultant is unable to substantially perform services hereunder due to
illness, injury, accident or condition of either a physical or psychological
nature for greater than ninety (90) days.
(b) Termination by the Company for Cause. The Company may
terminate Consultant's engagement for "cause" (as hereinafter defined) after
prior written notice to Consultant setting forth in reasonable detail the nature
of such cause. For the purposes hereof, "cause" shall be determined by the Board
of Directors of the Company acting in good faith and shall include (but not be
limited to):
(i) the conviction of Consultant by a court of
competent jurisdiction of any felony,
misdemeanor or any criminal
-4-
offense involving breach of trust,
misappropriation or dishonesty against the
Company or Novirio Pharmaceuticals Limited,
a Cayman Islands corporation ("Novirio
Limited"), or any subsidiary of Novirio
Limited, or the entering of a plea by
Consultant of nolo contendere thereto;
(ii) the commission by Consultant of an act of
fraud upon the Company, Novirlo Limited or
any subsidiary of Novirio Limited;
(iii) Consultant's willful violation of any United
States federal, state or local or foreign
government law, rule or regulation governing
the operation of the Company, Novirio
Limited or any subsidiary of Novirio
Limited; or
(iv) a material breach by Consultant of this
Agreement, which breach continues for more
than twenty (20) business days after written
notice given to Consultant, such notice to
set forth in reasonable detail the nature of
such breach.
(c) Termination by Consultant. Consultant may terminate his
engagement for any reason whatsoever upon ninety (90) days' prior written notice
to the Company.
10. Payments Upon Termination. Upon termination of Consultant,
Consultant shall be entitled to receive from the Company, unpaid through the
date of termination and (ii) reimbursement of expenses which have been incurred
through the date of such termination.
11. Independent Contractor. Both the Company and the Consultant agree
that Consultant acts as an independent contractor in the performance of his
duties under this Agreement. Nothing in this Agreement shall be deemed to make
the Consultant an employee, partner or agent for the Company, Novirio Limited or
any subsidiary of Novirio Limited, nor shall either party have any authority to
bind the other in any respect. Accordingly, the Consultant shall be responsible
for payment of, and shall indemnify and hold the Company harmless against, all
taxes, including, without limitation, federal, state and local taxes and taxes
assessed by foreign countries arising out of the Consultant's activities in
accordance with this Agreement, including by way of illustration but not
limitation, federal and state income tax, Social security tax, a foreign
country's income tax, unemployment insurance taxes, Medicare taxes and any other
taxes, or business license fees as required.
-5-
12. Notices. Any notices, requests, demands and other communications
provided for by this Agreement shall be sufficient if in writing and delivered
in person or sent by registered or certified mail, postage paid, to Consultant
at the last address Consultant has filed in writing with the Company, or, in the
case of the Company, to the attention of its President. All such communications
shall be deemed given upon receipt. Any party may by notice in writing to the
other parties change the address to which notices to it or him are to be
addressed hereunder.
13. Miscellaneous.
(a) Entire Agreement: Amendments; Waivers. This Agreement
contains the entire understanding of the parties regarding its subject matter
and any amendment to this Agreement, and any waiver of any provision hereof,
shall be in writing and shall require the prior written approval of the
Consultant and the Board of Directors of Novirio Limited. Any waiver by the
Company of a breach of any provision of this Agreement shall not operate or be
construed as a waiver of any subsequent breach hereof.
(b) Survival. Except as otherwise provided in this Agreement,
the obligations of the Company and Consultant contained in Sections 4, 6, 7 and
11 and this Section 13 shall survive the termination of this Agreement.
(c) Governing Law; Consent to Jurisdiction. Consultant agrees
that any dispute in the meaning, effect or validity of this Agreement shall be
resolved in accordance with the laws of the Commonwealth of Massachusetts
without regard to the conflict of laws provisions thereof. The Consultant hereby
agrees to submit to the nonexclusive jurisdiction of the court in and of the
Commonwealth of Massachusetts and to the courts to which an appeal of the
decisions of such courts may be taken and consents that service of process with
respect to all courts in and of the Commonwealth of Massachusetts may be made by
registered mail to Consultant's address set forth on page one hereof.
(d) Enforcement. In view of the substantial harm which will
result from the breach by Consultant of any of the covenants contained in
Sections 4, 6 and 7, the parties agree that such covenants shall be enforced to
the fullest extent permitted by law. Accordingly, if, in any judicial
proceeding, a court shall determine that such covenants are unenforceable
because they cover too extensive a geographic area or survive for too long a
period of time, or for any other reason, then the parties intend that such
covenants shall be deemed to cover such maximum geographic area and maximum
period of time and shall otherwise be deemed to be limited in such manner as
will permit enforceability by such court. If any term or provision of this
Agreement or the application thereof to any circumstance shall, to any extent,
be invalid or
-6-
unenforceable, the remainder of this Agreement or the application to other
persons and circumstances shall not be affected thereby and each term and
provision hereof shall be enforced to the fullest extent permitted by law.
(e) Remedies. Consultant agrees that his breach of any of the
provisions of Sections 4, 6 and 7 above will cause irreparable damage to the
Company and that the recovery by the Company of money damages will not alone
constitute an adequate remedy for such breach. Accordingly, Consultant agrees
that such provisions may be specifically enforced against it or him, in addition
to any other rights or remedies available to the Company on account of any such
breach.
(f) Indemnification.
(i) Consultant will indemnify and hold the
Company harmless, and will defend the
Company against any and all loss, liability,
damage, claims, demands or suits and related
costs and expenses to persons or property
that arise, directly or indirectly, from
acts or omissions of Consultant, or breach
by the Consultant of any term or condition
of this Agreement.
(ii) The Company will indemnify and hold the
Consultant harmless, and will defend the
Consultant against any and all loss,
liability, damage, claims, demands or suits
and related costs and expenses to persons or
property that arise, directly or indirectly,
from breach by the Company of any term or
condition of this Agreement, and from acts
taken by the Consultant on behalf of the
Company if he (i) acted in good faith, in
accordance with this Agreement and in a
manner he reasonably believed to be in or
not opposed to the best interests of the
Company, and (ii) with respect to any
criminal action or proceeding, had no
reasonable cause to believe his conduct was
unlawful.
(g) Successors and Assigns. This Agreement shall be binding
upon Consultant, and inure to the benefit of, the parties hereto and their
respective heirs, successors, assigns and personal representatives; provided,
however, that it shall not be assignable by Consultant.
(h) Attorney's Fees. If any action at law or in equity is
necessary to enforce or interpret the terms of this Agreement, the prevailing
party shall be entitled to reasonable attorney's fees, costs and necessary
disbursements, in addition to any other relief to which the party may be
entitled.
-7-
(i) Public Disclosure.
(i) Except as required by law, neither
Consultant nor the Company shall disclose
the terms of this Agreement, or the
transactions contemplated by this Agreement
without the written consent of the other
party and Emory University.
(ii) Except as required by law, the Company shall
not without the prior consent of the
Consultant issue any press release or other
public statement directed through the media
which discloses the name of the Consultant
or the Consultant's relationship with the
Company
(j) Disputes arising under this Agreement shall be resolved by
a panel of three arbitrator in an arbitration conducted in accordance with the
rules of the American Arbitration Association. The decision of a majority of the
three arbitrators shall be final and binding upon the parties. The Consultant
shall select one arbitrator, the Company shall select a second arbitrator and
the two so selected shall select and designate a third arbitrator.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
a sealed document on the date first above written.
NOVIRIO PHARMACEUTICALS, INC.
By: /s/ Xxxxxxx Xxxxx
________________________________________
Name: Xxxxxxx Xxxxx
______________________________________
Title: CFO
_____________________________________
/s/ Xxxxxxx Xxxxxxxx
___________________________________________
Xxxxxxx X. Xxxxxxxx
-8-
EXHIBIT A
DUTIES OF A CONSULTANT
XX. XXXXXXX XXXXXXXX is Professor of Pediatrics and Chemistry, and Director,
Laboratory of Biochemical Pharmacology at Emory University. He will provide
expertise in the area of drug resistance, cross-resistance, ways to overcome
resistance, the design of combination trials and virological issues in general.
His knowledge of chemistry, in addition to virology, will provide rapid
solutions to technical issues at the interface of these two disciplines. As a
founder of both Pharmasset and the Company, he will facilitate technology
transfers from Pharmasset to the Company.
EXHIBIT B
CURRENT AFFILIATIONS
- NIH
- Emory University
- VA Medical Center
- Georgia State University
- Pharmasset Ltd.
- Quad Pharma
- Triangle Pharmaceuticals
- General Medical Industries
- Murex/Abbott
- Innogenetics
- IVAX
- Andrx Pharmaceuticals
- Xxxxxxx Pharmaceutical
- Xxxxx Xxxx Dango
- Moravak
- [Illegible]
- International Press
