CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT (this "Agreement") is entered into by and
between Cellegy Pharmaceuticals, Inc., a California corporation (the "Company"),
and Xxxxx X. Xxxxx, M.D. ("Consultant"), and is effective as of May 1, 1996 (the
"Effective Date").
BACKGROUND
The Company and Consultant are parties to a Consulting Agreement dated
April 2, 1992 (the "Prior Consulting Agreement"). The term of the Prior
Consulting Agreement expires in April 1997. In light of the changes that have
occurred since the date of the Prior Consulting Agreement to the Company's
business and the work that Consultant has performed and intends to perform
relating to the Company's business, the parties desire to enter into a new
consulting agreement.
AGREEMENT
THE PARTIES AGREE AS FOLLOWS:
1. Consulting Services. During the term of this Agreement, Consultant
shall provide technical services to the Company and part-time consulting
services in the area of dermatologic therapeutics, skin care, transepithelial,
topical drug delivery (both passive and active transport) and all aspects of
epithelial structure, function, and metabolism, including without limitation
related to:
Modulation of Epithelial Barrier Function;
Pathogenesis, Prevention, and Treatment of Epithelial Disorders;
Regulation of Epithelial Differentiation/Proliferation;
Embryology, Maturation and Aging of Epithelial Membranes;
Epithelial Lipid/Protein Biochemistry, Biophysics, and Physiology; and
Signaling Pathways of Epithelial Functions (including without
limitation to interactions of ions, water, pH, cytokines, growth
factors, cellular membrane receptors/channels, soluble receptor,
antibodies, etc.).
The services rendered and work performed by, or under the supervision or control
of, Consultant pursuant to this Agreement shall be referred to as the
"Services." In addition, subject to the overall authority of the Board of
Directors of the Company to determine the membership of the Company's Scientific
Advisory Board (the "SAB"), Consultant shall also serve as Co-Chairman of the
SAB.
1.1 Personal Consultation. Consultant shall provide the
Services to the Company or its designees as reasonably requested from time to
time by the Company but in any event up to two (2 Days/Month) working days per
month on average, totaling twenty-four (24) working days annually during the
term of this Agreement. If the Company requests additional Services such that
Consultant is working more than 2 days per month on average, Consultant may
charge the Company additional per diem consulting fees in an amount pro-rated
based on
the monthly compensation described in Section 2.1 of this Agreement (which is
based on 2 working days per month).
1.2 Clinical Trials. Consultant will assist in the
identification and recruitment of appropriate clinicians to perform, for the
Company or its designees, clinical trials of new compounds on appropriate
subject populations at study sites desired by Company, including for example,
and to the extent possible, the Veterans Administration Medical Center, San
Francisco ("VAMC") or the University of California Medical School ("UC-SF"). As
requested by Company, Consultant will provide advice and assistance on
contracting with the study sites future clinical studies and initiating and
conducting clinical studies.
1.3 Disclosure of Current and Future Relationships. Consultant
will keep the Chief Executive Officer and/or Vice President, Research and
Development, of the Company informed concerning the general nature of
Consultant's arrangements or agreements concerning any activities supported or
funded by third party entities which might conflict with Services provided by
him under this Agreement.
2. Compensation, Expenses and Payment. Following the Effective Date:
2.1 Compensation. For any and all Services the Consultant may
render pursuant hereto, during the term of this Agreement, the Company shall pay
the Consultant a consulting fee at the rate of Three Thousand Five Hundred
dollars ($3,500.00) per calendar month following the Effective Date, payable in
arrears on the fifth (5th) business day following the end of such calendar
month.
2.2 Reimbursement of Expenses. The Consultant shall be
reimbursed for reasonable out-of-pocket expenses incurred following the
Effective Date in connection with rendering of the Services to the extent
reasonably verified by receipts and other written evidence. No expenses of
Consultant in excess of Five Hundred Dollars ($500.00) shall be incurred without
the advance approval of the Chief Executive Officer of the Company.
3. Inventions and Assignment Thereof.
3.1 Assignment of Inventions. (a) To the extent not prohibited
by agreements or legally enforceable policies to which Consultant is a party or
by which Consultant is bound which were in existence before the date of this
Agreement (the "Prior Agreements") all Inventions (as defined in Section 3.4
hereof) conceived of or made by the Consultant, either alone or with others,
during the term of this Agreement, whether or not such Inventions are conceived
of or made during the Consultant's regular working hours while performing
Services or whether or not the Consultant is then actually rendering Services,
which (i) are developed, in whole or in part, in reliance upon any of the
Company's equipment or supplies (except for such Company equipment or supplies,
if any, which are located at the VAMC or UC-SF laboratories and which are used
in other research activities of Consultant for work under other Agreements with
Company), facilities or Confidential Information (as defined in Section 3
hereof), or (ii) result from any work performed by the Consultant for the
Company or its designees, are and shall be the sole property of the Company,
whether as "works for hire" or otherwise. Except to the
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extent the Consultant is expressly prohibited from doing so by the Prior
Agreements, the Consultant hereby irrevocably assigns and transfers to the
Company all of Consultant's right, title and interest in and to all such
Inventions, including any and all patent rights, copyrights or moral rights in
such Inventions, and the Consultant shall not disclose any such Inventions to
others without the express written consent of the Company.
(b) For the purpose of this Agreement, an Invention is
deemed to have been made during the term of this Agreement if, during such
period, the Invention was conceived or first actually reduced to practice; and
any patent applications filed by Consultant, either alone or with others, within
one (1) year following expiration of the term of this Agreement shall be
presumed to relate to an Invention with respect to which the Company has rights
pursuant to this Section 3.1, unless the Consultant can prove to the contrary by
a preponderance of the evidence. Notwithstanding anything to the contrary
contained herein, this Section 3 shall not apply to any Invention which fully
qualified under Section 2870 of the California Labor Code.
(c) Consultant represents and warrants to Company that he
has disclosed all such Prior Agreements to Company on Schedule A attached
hereto, including his Prior Agreements with the VAMC and UC-SF (which Company
hereby acknowledges), and that during the term of this Agreement, he shall
disclose to the Company his desire to enter into any other agreements which
might impair his obligations hereunder prior to entering into such other
agreements. Consultant represents and warrants that he will promptly disclose to
the Company any such inventions that might be subject to this Section 3.
3.2 Disclosure to the Company. Attached hereto as Schedule B
is a list identifying in detail, to the extent not prohibited by any Prior
Agreements, all Inventions actually conceived of, made or reduced to practice by
the Consultant, alone or with others, before the date of this Agreement, which
have not been previously disclosed on a Schedule to the Prior Consulting
Agreement or which has not previously been assigned to the Company pursuant to
the provisions of the Prior Consulting Agreement, and which are excluded from
this Section 3 except to the extent that the Company hereafter obtained rights
to such Inventions. Subject to his express obligations under the Prior
Agreements, the Consultant shall disclose promptly and in writing to the Board
of Directors of the Company all Inventions which the Consultant considers may be
patentable (whether the Consultant considers them to fully qualify under Section
2870 or not), or otherwise may be of value or interest to the Company, which the
Consultant, alone or with others, conceives or develops while performing within
the scope of the Agreement. The disclosure of such Invention shall be protected
by the Company by all reasonable technical and legal means, including without
limitation those steps which the Company takes to protect the Company's own
trade secrets.
3.3 Further Obligations. The Consultant shall, at any time
during the term of this Agreement and after it terminates for any reason, on
request of the Company and at its expense, execute and acknowledge specific
assignments in favor of the Company or its nominee of any or all of the
Inventions covered by this Section 3, as well as execute and acknowledge all
papers and perform all lawful acts the Company considers necessary or advisable
for the preparation, prosecution, issuance, procurement and maintenance of
patent applications and patents of the United States and foreign countries for
such Inventions, and for the transfer of any
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interest therein the Consultant may have, and shall execute and acknowledge any
and all papers and lawful documents required or necessary to vest title in the
Company or its nominee in all Inventions, patent application, patents and
interests. The Consultant shall execute all documents and assist, at the
Company's expense, in the preservation of all of the Company's interests,
arising under this Agreement.
3.4 Definition of "Inventions". For the purposes of this
Section 3, "Invention" means any new formulae, compound, know-how, techniques,
applications, reports, studies, analyses, combinations, machines, methods,
processes, algorithms, routines, subroutines, apparatuses, compositions of
matter, designs, uses, plans or configurations of any kind, discovered,
conceived, developed, made, created or produced, or any improvements or
derivatives of them, and shall not be limited to the definition of any invention
contained in the United States patent laws.
3.5 Cooperation. The Consultant, at the Company's expense and
to the extent not prohibited by any Prior Agreements, shall cooperate as
reasonably requested by the Company to protect the interests and proprietary
rights of the Company and its designees under the Agreement, whether through
litigation against third parties and otherwise, and to the extent legally
permitted shall not take any action or provide any testimony adverse to the
Company without its prior written consent to such action or testimony.
Consultant will acknowledge his relationship with the Company in meetings,
scientific conferences and poster exhibits as requested by the Company. When the
Company scientists have contributed to the information, the Company will be
appropriately credited by Consultant.
4. Confidential Information.
4.1 Definition. For purposes of this Agreement, "Confidential
Information" means any confidential or proprietary information relating to the
business or operations of the Company, trade secrets, Inventions, formulae,
know-how, testing procedures, data and interpretations, actual or proposed
products or business plans, marketing plans and financial data. Confidential
Information shall not include information which is or becomes publicly and
generally known without any breach of this Agreement, or which Consultant can
demonstrate through contemporaneously prepared written evidence to have known by
him prior to or other than through its disclosure by Company or development in
connection with his rendering Services to Company.
4.2 Confidentiality. Consultant agrees that the Confidential
Information developed by or for the Company, is proprietary and of significant
value to the Company and that the disclosure or unauthorized use thereof could
cause the Company material and irrevocable harm. Therefore, except only to the
extent the Consultant is expressly required to do so under the Prior Agreements,
Consultant shall not, without the prior written consent of the Company, disclose
to unauthorized persons, or use for any purpose (other than for the Company's
benefit) either during or after the term of this Agreement, any Confidential
Information. Consultant shall take all reasonable steps to protect Confidential
Information.
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4.3 Notes, Memoranda, etc. Except to the extent expressly
provided otherwise by the Prior Agreements, all notes, memoranda, reports,
drawings, materials, data and other papers and records of every kind, however
embodied, which were in or shall come into the Consultant's possession at any
time during the term of this Agreement and relating to any Confidential
Information or the Services, shall be the sole and exclusive property of the
Company, and shall (together with all copies, notes, portions, excerpts,
extractions or translations thereof) be surrendered to the Company upon
termination of this Agreement or upon request by the Company at any other time
either before or after the termination of this Agreement.
5. Non-Competition. During the term of this Agreement, the
Consultant shall not, without the prior written consent of the Company, directly
or indirectly, whether as a partner, employee, joint venturer, licensor,
officer, director or otherwise, engage in any activity of a business or
commercial nature to a business or other entity which competes, directly or
indirectly, with the actual or proposed business or research and development of
the Company. The Consultant may, however, (i) beneficially own interest of less
than five percent (5%) of the outstanding voting stock of publicly traded
companies, or of private companies that are not direct competitors of the
Company, (ii) conduct a private medical practice treating solely his personal
patients (but not for purposes of research or development), (iii) act as an
employee of VAMC or UC-SF consistent with his current employment, (iv) perform
scientific consulting activities for other entities (as contemplated by the
other provisions of this Agreement), (v) give or participate in lectures or
symposia presenting information (but not Confidential Information) for
educational purposes only, or (vi) seek other full-time or part-time employment
that is not directly or indirectly competitive with the actual or proposed
business or research and development of the Company. In addition to and without
limiting the generality of the foregoing, following the termination of this
Agreement, the Consultant shall not (i) solicit the services of any of the
Company's then-current employees, or (ii) solicit business directly or
indirectly from any of the Company's clients or customers on behalf of an entity
or person who competes, directly or indirectly, with the business of the Company
as conducted or proposed to be conducted so that such entity or person can
supply goods or services to the Company's clients or customers in addition to or
in lieu of the Company, but subject to Section 4 hereof, clause (ii) shall in no
way limit or restrict the Consultant from providing personal consulting services
to or for any person or entity following the termination of this Agreement.
6. No Conflicts with Rights of Third Parties. The Consultant
hereby represents and warrants to the Company that the Consultant is not a party
to or bound by any agreement, obligation or understanding which restricts or
limits in any way the Consultant's right to enter into this Agreement or the
Consultant's right or ability to perform his obligations under this Agreement,
including without limitation the Prior Agreements. Further, the Consultant
covenants to the Company that he shall not knowingly and recklessly use or
infringe the intellectual property rights, trade secrets, patents, copyrights,
or other proprietary rights of any third party in the performance of the
Consultant's obligations under this Agreement.
7. Termination, Survival of Provisions.
7.1 Term. This Agreement shall commence as of the Effective
Date and shall terminate at the close of business on the third anniversary of
the Effective Date (the "Initial
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Term"), unless terminated sooner as provided herein. The Company may, by notice
delivered to Consultant at least 30 days before the expiration of the Initial
Term, extend the term of the Initial Term, extend the term of this Agreement for
an additional one-year period.
7.2 Termination. Notwithstanding the provisions of Section
7.1, the Agreement shall terminate upon the first of the following:
(a) Death. Upon the Consultant's death or (at the
Company's option) permanent disability, as determined in good faith by the Board
of Directors of the Company;
(b) Consent. Upon the written request of one or both
parties;
(c) Breach. By either party upon the material breach of
the other party, provided the non-breaching party has provided the breaching
party with notice of the breach, and such breach has remained uncured for a
period of thirty (30) days;
(d) Liquidation, Etc. The liquidation, dissolution or
indefinite cessation of business operations of the Company; or
(e) General Assignment, Etc. The execution by the Company
of a general assignment for the benefit of creditors or the appointment of a
receiver or trustee to take possession of the property and assets of the
Company.
7.3 Survival of Provisions. The provisions of Sections 3, 4, 5
(last sentence only), and 6 shall survive expiration or termination of the
Agreement for any reason.
8. Miscellaneous.
8.1 Notices. Except as otherwise provided in the Agreement,
any notice or other communication required or permitted hereunder shall be in
writing and shall be deemed to have been duly given (i) on the date of delivery
if delivered personally, (ii) one business day after transmission by telex or
facsimile transmission, or (iii) four (4) days after mailing if mailed, by first
class mail, certified or registered with return receipt requested, postage
prepaid to the following addresses:
If to Consultant: If to Company:
Xxxxx X. Xxxxx, M.D. Attention: President
0000 X. Xxxxxxxxx Xxxx. #000 Cellegy Pharmaceuticals, Inc.
Xxxxxx Xxxx, XX 00000 Foster City, CA
8.2 Damages, Service of Process. The Consultant acknowledges
that the Company will suffer substantial damages not readily ascertainable or
compensable in terms of money in the event of the breach of any of the
Consultant's obligations under Sections 3, 4, 5, or 6 of this Agreement. The
Consultant further agrees that services of process upon the Consultant in any
such action or proceeding may be made by first-class mail, certified or
registered, return receipt requested as provided for the giving of notices in
Section 8.1 of this Agreement.
8.3 Headings. The headings appearing at the beginning of the
several sections contained herein have been inserted for identification and
reference purposes and shall not by themselves determine the construction or
interpretation of this Agreement.
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8.4 Assignment. The Consultant has been retained by the
Company due to the Consultant's particular skill and expertise. Therefore, the
Consultant may not assign, delegate or subcontract any of the Consultant's
rights or obligations hereunder. The Company may assign this Agreement in its
discretion. This Agreement shall be binding upon and inure to the benefit of the
respective heirs, executors, administrators, successors, legal representatives
and assigns of the parties.
8.5 Enforcement. If any portion of this Agreement shall be
determined to be invalid or unenforceable, the remainder shall be valid and
enforceable to the maximum extent possible.
8.6 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of California applicable to
contracts entered into between California residents and to be performed wholly
in California.
8.7 Entire Agreement and Modification. This Agreement and the
Exhibits and Schedules hereto (which are hereby incorporated by reference)
constitutes and contains the entire agreement of the parties respecting the
subject matter hereof and supersede any and all prior negotiations,
correspondence, understandings and agreements between the parties respecting the
subject matter hereof. This Agreement may only be modified by a written
instrument signed by the parties hereto. Commencing from the Effective Date,
this Agreement shall supersede the Prior Consulting Agreement with respect to
the subject matter of this Agreement; provided, however, that nothing in this
Agreement shall modify, limit or reduce the Company's rights with respect to the
Existing Products as defined in the Prior Consulting Agreement.
8.8 Other Instruments. The parties agree to execute such
further instruments and to take such further action as may reasonably be
necessary to carry out the intent of this Agreement.
8.9 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
8.10 Independent Contractor. The Consultant enters into this
Agreement as, and shall continue to be, an independent contractor. Under no
circumstances shall the Consultant look to the Company as the Consultant's
employer. Neither party has any authority to bind the other party to any third
party or otherwise to act as the agent or representative of such other party.
The Consultant agrees to pay all federal, state and other income taxes due and
to properly file appropriate tax returns.
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IN WITNESS WHEREOF, the parties hereto have caused this
Consulting Agreement to be duly and validly executed and delivered as of the
date first above written.
Cellegy Pharmaceuticals, Inc. Xxxxx X. Xxxxx, M.D.
By: /s/ Xx. Xxxx Xxxxxxxxxx /s/ Xxxxx X. Xxxxx
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Xx. Xxxx Xxxxxxxxxx Xxxxx X. Xxxxx, M.D.
Acting President & Chief Executive Officer
The undersigned, on behalf of the University of California and the Veterans
Administration Medical Center have reviewed this Agreement and hereby agree that
the obligations undertaken by Xx. Xxxxx are not in conflict with his employment
agreements with our respective institutions.
University of California San Francisco Veterans Administration
Medical Center
By: By:
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Date: Date:
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SCHEDULE A -- PRIOR AGREEMENTS
(SEE SECTION 3.1(C), USE ATTACHMENTS IF NEEDED)
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Other Parties Effective and Termination Dates Nature of Relationship and Duties
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SCHEDULE B -- INVENTIONS NOT PREVIOUSLY DISCLOSED
(SEE SECTION 3.2, USE ATTACHMENTS IF NEEDED)
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Title of Invention Dates Conceived and Inventors, Nature of Invention, and Names of
Reduced to Practice Other Parties Possibly Having Rights in
Invention
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