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EXHIBIT 10.16
MANAGEMENT SERVICES AGREEMENT
THIS MANAGEMENT SERVICES AGREEMENT is made as of the 30th day of November, 1999
by and between Lakaro Biopharmaceuticals, Inc., a Delaware corporation (the
"Sponsor") and B.R.T. Biopharmaceuticals Ltd. (the "Company") an Israeli company
having its registered offices at Sha'arei Ha'ir, 216 Jaffa Street, Jerusalem,
Israel.
WHEREAS the Sponsor is a biopharmaceutical company engaged in the research and
development of biopharmaceutical products for the world market (the "Business");
and
WHEREAS the Sponsor wishes to engage the services of its subsidiary, the
Company, to carry out the services more fully set forth below in connection with
the Business.
NOW, THEREFORE, the parties agree as follows:
1. Services
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The Company shall, in consultation with the Sponsor:
1.1 supervise and monitor the research and development conducted in Israel in
connection with the Business;
1.2 advise the Sponsor with respect to the direction of the Sponsor's research
and product development in connection with the Business; and
1.3 report to the Sponsor on the progress of the research and product
development being conducted in Israel in connection with the Business; and
1.4 assist in the performance of marketing services on behalf of the Sponsor in
connection with the Business and any products developed in the Business;
1.5 continue with research and development, which shall include without
limitation, the conducting of clinical trials; and
1.6 engage the services of advisory firms, consultants, and professionals, as
it deems necessary, in order to better perform the services enumerated
above (the "Services") or other services in connection therewith.
2. Payment
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In consideration for the Services, the Sponsor will pay the Company during
the term of this Agreement, a monthly fee equal to the amount of 110% of
expenses incurred (the "Fee"), to be adjusted annually between the Sponsor
and the Company, plus Value Added Tax ("VAT") thereon, if payable, at the
rate applicable at the time of issue by the Company to the Sponsor of a tax
invoice in respect of the Services. The Fee shall be paid quarterly in
advance on the first business day of January, April, July and October in
each year during the term hereof.
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3. Effective Period
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This Agreement shall become effective upon its execution, and shall remain
in effect until either party terminates the Agreement by giving the other
party ninety (90) days prior written notice of termination.
4. Relationship of Parties
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The Company is an independent contractor and is not an agent or employee
of, and has no authority to bind, the Sponsor by contract or otherwise,
unless and to the extent expressly authorized in writing by the Board of
Directors of the Sponsor, whether by grant of power of attorney or
otherwise.
5. Confidentiality
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The Sponsor and the Company warrant and undertake that during the term of
this Agreement and subsequent thereto, it shall maintain confidentiality
and also be liable for its employees and/or representative and/or persons
acting on its behalf maintaining absolute confidentiality of all in
formation, details and data which is in and/or comes to its knowledge
and/or that of its employees and/or representatives and/or persons acting
on its behalf directly or indirectly relating to the Services, the Know How
or any products based on the Know How. The Sponsor and the Company
undertake not to convey or disclose (except in connection with the
fulfillment of its duties under this Agreement) anything in connection with
the foregoing. "Confidential Information" shall include, but shall not be
limited to, confidential or proprietary scientific or technical information
or data, business plans, trade secrets, or other confidential information
relating to customers, development programs, costs, marketing, trading,
investment, sales activities, promotion, credit and financial data,
manufacturing processes, financing methods, plans or the business and
affairs of the Sponsor or the Company generally, or of any subsidiary or
affiliate of the Sponsor or the Company. "Confidential Information" shall
not include, however, information in the public domain, information
disclosed to the Sponsor or the Company by a third party entitled to
disclose it without any obligation of confidentiality, or, information
already known to the Sponsor or the Company prior to its receipt.
6. Indemnification.
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The Company agrees to indemnify and hold harmless the Sponsor and its
respective partners, affiliates, shareholders, directors, officers, agents,
advisors, representatives, employees, counsel and controlling persons
within the meaning of the Securities Act of 1933, as amended, (a "Sponsor
Indemnified Party") from and against any and all direct losses,
liabilities, claims, damages and expenses whatsoever (and all actions in
respect thereof) but excluding consequential loss and to reimburse the
Sponsor Indemnified Party for reasonable legal fees and related expenses as
incurred (including, but not limited to the costs of giving testimony or
furnishing documents in response to a subpoena or otherwise, the costs of
investigating, preparing, pursuing or defending any such action or claim
whether or not pending or threatened, whether or not resulting in any
liability, and whether or not the Sponsor or any Sponsor Indemnified Party
is a party thereto), insofar as such losses, liabilities, claims, damages
or expenses arise out of, relate to, whether or not resulting in any
liability, are incurred in connection with or are in any way a result of
(a) this Agreement, including any modifications or future additions to this
Agreement, (b)
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any act by the Company or any Sponsor Indemnified Party taken in connection
with the services to be provided under this Agreement, (c) the employment
by the Company of any device, scheme or artifice to defraud, or the
engaging by the Company in any act, practice or course of business which
operates or would operate as a fraud or deceit, or any conspiracy with
respect thereto, in connection with this Agreement; provided, however, that
the Company will not be liable in any such case if and to the extent that
any such loss, claim, damage, liability or expense arises out of or is
based upon the negligence, recklessness or willful misconduct of the
Sponsor or any Sponsor Indemnified Party.
7. Amendments: Waivers
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This Agreement may be altered or amended, and any provisions hereof may be
waived, only upon the written approval of the Sponsor and the Company
8. Notices
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Any notice or other communication given under this Agreement shall be
deemed to have been given in writing (including telex, telecopy or similar
teletransmission) addressed as provided below or to the addressee at such
other address as the addressee shall have specified by notice actually
received by the addressor), and if either (a) actually delivered in fully
legible form to such address (evidenced in the case of a telex by receipt
of the correct answerback) or (b) in the case of a letter, five days shall
have elapsed after the same shall have been deposited in the post, with
postage prepaid and registered or certified.
If to the Sponsor, to it at: c/o Paramount Capital, Inc.
787 Seventh Avenue, 48th floor
New York, New York 10019
Attn: Peter Kash
Tel: 212-554-4340
Fax: 212-554-4355
If to the Company, to it at: 216 Jaffa Road
Sha'arei Ha'ir
Jerusalem, Israel 94383
Attn: Bob Trachtenberg
Tel: 972-2-537-4997
Fax: 972-2-537-5098
9. Successors
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This Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective heirs, successors and assigns provided,
however, that neither party may assign this Agreement except to an
Affiliate that agrees in writing to bound hereby and to assume all of the
obligations of the assigning party hereunder. For the purposes hereof, an
"Affiliate" shall mean any entity that, directly or indirectly through one
or more intermediaries, controls, or is controlled by, or is under common
control with, either party hereto.
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10. Headings
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The headings in this Agreement are inserted for convenience of reference
only and shall not be a part of or control or affect the meaning hereof.
11. Entire Agreement
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This Agreement supersedes any and all oral or written agreements heretofore
made relating to the subject matter hereof and constitutes the entire
agreement of the parties relating to the subject matter hereof.
12. Governing Law
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This Agreement shall be governed by and construed in accordance with the
laws of Israel.
IN WITNESS WHEREOF, each of the undersigned has caused this Agreement to be duly
executed and delivered as an agreement under seal as of the date first above
written.
Lakaro Biopharmaceuticals, Inc. B.R.T. Biopharmaceuticals, Ltd.
By: /s/ Bob Trachtenberg By: /s/ Ira Weinstein
____________________________ ____________________________
Name: Bob Trachtenberg Name: Ira Weinstein
__________________________ ___________________________
Title: Secretary Title: CFO
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