EXHIBIT 10.12

DIRECTOR'S AGREEMENT

 

THIS AGREEMENT is dated on the 19th day of November, 2015.

 

BETWEEN:

 

PIVOT PHARMACEUTICALS INC., a corporation of the province of British Columbia
with offices at 1275 West 6th Avenue, Vancouver, British Columbia, Canada V6H
1A6.

 

(the "Company")

 

AND:

 

PATRICK C. FRANKHAM, having an address at 388 de la Fauvette, Rosemere, QC
Canada J7A 4J7.

 

(the "Director")

 

WHEREAS:

 

A. the Company carries on business as a drug development company, developing and
commercializing new uses for existing prescription drugs for diseases mediated
by acute and chronic inflammatory reactions, as well as developing proprietary
encapsulation technology to enhance therapeutic effects of anti-inflammatory
drugs in the treatment of neurodegenerative diseases. (the "Business");

 

B. the Director holds a Ph.D. in Biomedical Science and is a physician,
researcher, and an executive with expertise in drug development and in the
management of pharmaceutical companies;

 

C. the Company desires to appoint the Director to its board of directors (the
"Board of Directors") to perform services as customarily required of corporate
directors in the pharmaceuticals industry; (the "Services"); and

 

D. the Director has agreed to provide the Services to the Company on the terms
and conditions of this Agreement.

 

NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the mutual
covenants and promises set forth herein, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged by
each, the parties hereto agree as follows:

 

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ARTICLE 1

APPOINTMENT AND AUTHORITY OF DIRECTOR

 

1.1 Appointment of Director. The Company, subject to the requisite
prior-approval of the Board of Directors, hereby:

 

(a)

appoints the Director to perform the Services for the benefit of the Company as
hereinafter set forth;

(b)

appoints the Director to the Board of Directors of the Company; and

(c)

authorizes the Director to exercise such powers as provided under this
Agreement.

 

The Director accepts such appointment on the terms and conditions herein set
forth.

 

1.2 Performance of Services. Director shall provide the Services subject to the
following terms and conditions:

 

(a)

the Director shall report directly to the Board of Directors;

(b)

the Director shall commit such time as is reasonably necessary to discharge his
or her duties as a member of the Board of Directors;

(c)

the Director shall faithfully, honestly and diligently serve the Company and
cooperate with the Company and utilize professional skill and care to ensure
that all services rendered hereunder, including the Services, are to the
satisfaction of the Company, acting reasonably, and the Director shall provide
any other services not specifically mentioned herein, but which by reason of the
Director's capability the Director knows or ought to know to be necessary to
ensure that the best interests of the Company are maintained; and

(d)

the Company shall report the results of the Director's duties hereunder as may
be requested by the Company from time to time.

 

1.3 Authority of Director. The Director shall have no right or authority,
express or implied, to commit or otherwise obligate the Company in any manner
whatsoever except to the extent specifically provided herein or specifically
authorized in writing by the Company.

 

ARTICLE 2
DIRECTOR'S AGREEMENTS

 

2.1 Expense Statements. The Director may incur expenses in the name of the
Company as agreed in advance in writing by the Chief Executive Officer or Chief
Financial Officer of the Company, provided that such expenses relate solely to
the carrying out of the Services. The Director will promptly forward all
invoices for expenses incurred on behalf of and in the name of the Company and
the Company agrees to pay said invoices directly on a timely basis.

 

2.2 Restrictions. The Director agrees to comply with all of the restrictions set
forth below at all times during the Term (as defined below) and for a period of
one year after the Termination Date (as defined below):

 

(a)

The Director will not, either directly or indirectly:

 

(i)

on its own behalf or on behalf of others, solicit, influence, divert, or attempt
to solicit or divert any business opportunity of and from the Company;

(ii)

on its own behalf or on behalf of others, solicit, influence, divert or hire
away, or attempt to solicit, divert, or hire away, any independent contractor
working exclusively for the Company or any person employed by the Company or
persuade or attempt to persuade any such individual to terminate his or her
contract or employment with the Company; and

(iii)

impair or seek to impair any relationship that the Company has with its
employees, customers, suppliers, agents or other parties with which the Company
does business or has contractual relations.

 

(b)

The Director confirms that the obligations in this Article 2 of this Agreement
are fair and reasonable given that, among other reasons:

 

(i)

the fiduciary responsibilities the Director will have with the Company will
expose the Director to the Confidential Information (as defined below) regarding
the Company's business and plans, all of which the Director agrees not to act
upon to the detriment of the Company; and

(ii)

the Director will be performing important strategic and development work for the
Company;

(iii)

the Director agrees that the obligations in this Section, together with the
Director's other obligations under this Agreement, are reasonably necessary for
the protection of the Company's proprietary interests and that given the
Director's general knowledge and experience they would not prevent the Director
from being gainfully employed if the employment relationship between the
Director and the Company were to end; and

(iv)

the Director also agrees that the obligations in Section are in addition to the
non-disclosure obligations provided for in this Agreement and acknowledges that
the Company would not have entered into this Agreement but for the protections
provided to the Company by all of the aforementioned obligations.

 

2.3 Regulatory Compliance. The Director agrees to comply with all applicable
securities legislation and regulatory policies in relation to providing the
Services, including but not limited to securities laws of the United States (in
particular, Regulation FD) and Canada and all laws, rules, regulations,
instruments and policies of the Securities and Exchange Commission of the United
States and the British Columbia Securities Commission.

 

2.4 Prohibition Against Insider Trading. The Director hereby acknowledges that
the Director is aware, and further agrees that the Director will advise those of
its directors, officers, employees and agents who may have access to
Confidential Information, that securities laws of the United States and Canada
prohibit any person who has material, non-public information about a company
from purchasing or selling securities of such a company or from communicating
such information to any other person under circumstances in which it is
reasonably foreseeable that such person is likely to purchase or sell such
securities.

 

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ARTICLE 3
COMPANY'S AGREEMENTS

 

3.1 Compensation. In consideration of the Director agreeing to join the Board of
Directors and enter into this Agreement and providing the Services to be
rendered by the Director pursuant to this Agreement, the Company shall grant to
the Director 10,000,000 options to purchase common shares in the capital stock
of the Company (the "Compensation Options") with an exercise price of $0.10,
immediate vesting and term of five years from date of grant. 2,000,000 of the
Compensation Options shall be granted to the Director on each of the following
dates: December 15, 2015, December 15, 2016, December 15, 2017, December 15,
2018 and December 15, 2019 pursuant to a stock option agreement to be entered
into on each of these dates. Both the Director and the Company agree that, in
the event of Director's resignation or termination with cause as a Director of
the Company, the Company may cancel any Compensation Options that have not been
granted.

 

3.2 Grant of Compensation Options. The Director acknowledges that each grant of
Compensation Options is subject to applicable rules of any stock exchange or
regulatory body having jurisdiction over the securities of the Company.

 

3.3 Information. Subject to the terms of this Agreement, including without
limitation Article 5 hereof, and provided that the Director agrees that it will
not disclose any material non-public information to any person or entity, the
Company shall make available to the Director such information and data and shall
permit the Director to have access to such documents as are reasonably necessary
to enable it to perform the Services under this Agreement. The Company also
agrees that it will act reasonably and promptly in reviewing materials submitted
to it from time to time by the Director and inform the Director of any material
inaccuracies or omissions in such materials.

 

ARTICLE 4
DURATION, TERMINATION AND DEFAULT

 

4.1 Effective Date. This Agreement shall become effective as of as of the date
written above (the "Effective Date") and shall continue for a period of 24
months from the Effective Date (the "Term") or until earlier terminated pursuant
to the terms of this Agreement (the "Termination Date"). This Agreement
supersede all prior and contemporaneous oral and written statements and
representations and contains the entire agreement between the parties with
respect to the Agreement.

 

4.2 Termination. Without prejudicing any other rights that the Company may have
hereunder or at law or in equity, the Company may terminate this Agreement
immediately upon it election to do so, or if it so elects, upon delivery of
written notice to the Director if:

 

(a)

the Director breaches any one section of Article 2 of this Agreement;

(b)

the Director breaches any other material term of this Agreement and such breach
is not cured to the reasonable satisfaction of the Company within thirty (30)
days after written notice describing the breach in reasonable detail is
delivered to the Director;

(c)

the Company acting reasonably determines that the Director has acted, is acting
or is likely to act in a manner detrimental to the Company or has violated or is
likely to violate the confidentiality of any information as provided for in this
Agreement;

(d)

the Director is unable or unwilling to perform the Services under this
Agreement; or

(e)

the Director commits fraud, serious neglect or misconduct in the discharge of
the Services.

 

4.3 Termination with Notice. Either the Director or the Company may terminate
this Agreement by providing at least thirty (30) days prior written notice to
the other party.

 

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4.4 Duties Upon Termination. Upon termination of this Agreement for any reason,
the Director shall upon receipt of all sums due and owing under this Agreement,
promptly deliver the following in accordance with the directions of the Company:

 

(a)

a final accounting, reflecting the balance of expenses incurred on behalf of the
Company as of the date of termination; and

(b)

all documents pertaining to the Company or this Agreement, including but not
limited to, all books of account, correspondence and contracts in his
possession, provided that the Director shall be entitled thereafter to inspect,
examine and copy all of the documents which it delivers in accordance with this
provision at all reasonable times upon three (3) days' notice to the Company.

ARTICLE 5

CONFIDENTIALITY AND NON-COMPETITION

 

5.1 Maintenance of Confidential Information. The Director acknowledges that in
the course of its appointment hereunder the Director will, either directly or
indirectly, have access to and be entrusted with information (whether oral,
written or by inspection) relating to the Company or its respective affiliates,
associates or customers (the "Confidential Information"). For the purposes of
this Agreement, "Confidential Information" includes, without limitation, any and
all Developments (as defined herein), trade secrets, inventions, innovations,
techniques, processes, formulas, drawings, designs, products, systems,
creations, improvements, documentation, data, specifications, technical reports,
customer lists, supplier lists, distributor lists, distribution channels and
methods, retailer lists, reseller lists, employee information, financial
information, sales or marketing plans, competitive analysis reports and any
other thing or information whatsoever, whether copyrightable or uncopyrightable
or patentable or unpatentable. The Director acknowledges that the Confidential
Information constitutes a proprietary right, which the Company is entitled to
protect. Accordingly, the Director covenants and agrees that during the Term and
thereafter until such time as all the Confidential Information becomes publicly
known and made generally available through no action or inaction of the
Director, the Director will keep in strict confidence the Confidential
Information and shall not, without prior written consent of the Company in each
instance, disclose, use or otherwise disseminate the Confidential Information,
directly or indirectly, to any third party.

 

5.2 Exceptions. The general prohibition contained in Section 5.1 of this
Agreement against the unauthorized disclosure, use or dissemination of the
Confidential Information shall not apply in respect of any Confidential
Information that:

 

(a)

is available to the public generally in the form disclosed;

(b)

becomes part of the public domain through no fault of the Director;

(c)

is already in the lawful possession of the Director at the time of receipt of
the Confidential Information; or

(d)

is compelled by applicable law to be disclosed, provided that the Director gives
the Company prompt written notice of such requirement prior to such disclosure
and provides assistance in obtaining an order protecting the Confidential
Information from public disclosure.

 

  

 

 

5.3 Developments. Any information, data, work product or any other thing or
documentation whatsoever which the Director, either by itself or in conjunction
with any third party, conceives, makes, develops, acquires or acquires knowledge
of during the Director's appointment with the Company or which the Director,
either by itself or in conjunction with any third party, shall conceive, make,
develop, acquire or acquire knowledge of (collectively, the "Developments")
during the Term or at any time thereafter during which the Director is engaged
by the Company that is related to the Business shall automatically form part of
the Confidential Information and shall become and remain the sole and exclusive
property of the Company. Accordingly, the Director does hereby irrevocably,
exclusively and absolutely assign, transfer and convey to the Company in
perpetuity all worldwide right, title and interest in and to any and all
Developments and other rights of whatsoever nature and kind in or arising from
or pertaining to all such Developments created or produced by the Director
during the course of performing this Agreement, including, without limitation,
the right to effect any registration in the world to protect the foregoing
rights. The Company shall have the sole, absolute and unlimited right throughout
the world, therefore, to protect the Developments by patent, copyright,
industrial design, trademark or otherwise and to make, have made, use,
reconstruct, repair, modify, reproduce, publish, distribute and sell the
Developments, in whole or in part, or combine the Developments with any other
matter, or not use the Developments at all, as the Company sees fit.

 

5.4 Protection of Developments. The Director does hereby agree that, both before
and after the termination of this Agreement, the Director shall perform such
further acts and execute and deliver such further instruments, writings,
documents and assurances (including, without limitation, specific assignments
and other documentation which may be required anywhere in the world to register
evidence of ownership of the rights assigned pursuant hereto) as the Company
shall reasonably require in order to give full effect to the true intent and
purpose of the assignment made under Section 5.3 hereof. If the Company is for
any reason unable, after reasonable effort, to secure execution by the Director
on documents needed to effect any registration or to apply for or prosecute any
right or protection relating to the Developments, the Director hereby designates
and appoints the Company and its duly authorized officers and agents as the
Director's agent and attorney to act for and in the Director's behalf and stead
to execute and file any such document and do all other lawfully permitted acts
necessary or advisable in the opinion of the Company to effect such registration
or to apply for or prosecute such right or protection, with the same legal force
and effect as if executed by the Director.

 

5.5 Reasonable Restrictions. The Director agrees that all restrictions in this
Article 5 are reasonable and valid, and all defenses to the strict enforcement
thereof by the Company are hereby waived by the Director.

 

ARTICLE 6
REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE DIRECTOR

 

6.1 Documents Required from the Director. The Director shall complete, sign and
return to the Company as soon as possible, on request by the Company, such
additional documents, notices and undertakings as may be required by regulatory
authorities or by applicable law.

 

6.2 Representations, Warranties and Covenants of the Director. The Director
hereby represents and warrants to and covenants with the Company (which
representations, warranties and covenants shall survive the end of the expiry of
the Term or early termination of this Agreement) that:

 

(a)

the entering into of this Agreement and the transactions contemplated thereby
will not result in the violation of any of the terms and provisions of any law
applicable to the Director, or of any agreement, written or oral, to which the
Director may be a party or by which the Director is or may be bound;

(b)

the relationship between the Director and the Company shall be that of
independent contractor, and nothing in this Agreement shall render the Director
an employee, agent or partner of the Company and the Director shall not hold
himself out as such.

(c)

in performing the Services pursuant to this Agreement, the Director will occupy
a position of high fiduciary trust and confidence and the Director will develop
and acquire wide experience and knowledge with respect to all aspects of the
manner in which the Company's business is conducted. Without limiting the
generality of the foregoing, the Director agrees to observe the highest
standards of loyalty, good faith and avoidance of conflicts of duty and
self-interest, in performing the Services.

 

 

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ARTICLE 7
MISCELLANEOUS

 

7.1 Notices. All notices required or allowed to be given under this Agreement
shall be made either personally by delivery to or by facsimile transmission to
the address set forth above or to such other address as may be designated from
time to time by such party in writing.

 

7.2 Independent Legal Advice. The Director acknowledges that:

 

(a)

this Agreement was prepared for and by the Company;

(b)

the Company has requested the Director to obtain his own independent legal
advice on this Agreement prior to signing this Agreement;

(c)

the Director has been given adequate time to obtain independent legal advice;

(d)

by signing this Agreement, the Director confirms that he fully understands this
Agreement; and

(e)

by signing this Agreement without first obtaining independent legal advice, the
Director waives his right to obtain independent legal advice.

 

7.3 Change of Address. Any party may, from time to time, change its address for
service hereunder by written notice to the other party in the manner aforesaid.

 

7.4 Entire Agreement. As of from the date hereof, any and all previous
agreements, written or oral between the parties hereto or on their behalf
relating to the appointment of the Director by the Company are null and void.
The parties hereto agree that they have expressed herein their entire
understanding and agreement concerning the subject matter of this Agreement and
it is expressly agreed that no implied covenant, condition, term or reservation
or prior representation or warranty shall be read into this Agreement relating
to or concerning the subject matter hereof or any matter or operation provided
for herein.

 

7.5 Further Assurances. Each party hereto will promptly and duly execute and
deliver to the other party such further documents and assurances and take such
further action as such other party may from time to time reasonably request in
order to more effectively carry out the intent and purpose of this Agreement and
to establish and protect the rights and remedies created or intended to be
created hereby.

 

7.6 Waiver. No provision hereof shall be deemed waived and no breach excused,
unless such waiver or consent excusing the breach is made in writing and signed
by the party to be charged with such waiver or consent. A waiver by a party of
any provision of this Agreement shall not be construed as a waiver of a further
breach of the same provision.

 

  

 

 

7.7 Amendments in Writing. No amendment, modification or rescission of this
Agreement shall be effective unless set forth in writing and signed by the
parties hereto.

 

7.8 Assignment. Except as herein expressly provided, the respective rights and
obligations of the Director and the Company under this Agreement shall not be
assignable by either party without the written consent of the other party and
shall, subject to the foregoing, enure to the benefit of and be binding upon the
Director and the Company and their permitted successors or assigns. Nothing
herein expressed or implied is intended to confer on any person other than the
parties hereto any rights, remedies, obligations or liabilities under or by
reason of this Agreement.

 

7.9 Severability. In the event that any provision contained in this Agreement
shall be declared invalid, illegal or unenforceable by a court or other lawful
authority of competent jurisdiction, such provision shall be deemed not to
affect or impair the validity or enforceability of any other provision of this
Agreement, which shall continue to have full force and effect.

 

7.10 Headings. The headings in this Agreement are inserted for convenience of
reference only and shall not affect the construction or interpretation of this
Agreement.

 

7.11 Number and Gender. Wherever the singular or masculine or neuter is used in
this Agreement, the same shall be construed as meaning the plural or feminine or
a body politic or corporate and vice versa where the context so requires.

 

7.12 Time. Time shall be of the essence of this Agreement. In the event that any
day on or before which any action is required to be taken hereunder is not a
business day, then such action shall be required to be taken at or before the
requisite time on the next succeeding day that is a business day. For the
purposes of this Agreement, "business day" means a day which is not Saturday or
Sunday or a statutory holiday in British Columbia, Canada.

 

7.13 Enurement. This Agreement is intended to bind and enure to the benefit of
the Company, its successors and assigns, and the Director and the personal legal
representatives of the Director.

 

7.14 Counterparts. This Agreement may be executed in several counterparts, each
of which will be deemed to be an original and all of which will together
constitute one and the same instrument.

 

7.15 Electronic Means. Delivery of an executed copy of this Agreement by
electronic facsimile transmission or other means of electronic communication
capable of producing a printed copy will be deemed to be execution and delivery
of this Agreement as of the effective date of this Agreement.

 

7.16 Governing Law. This Agreement will be governed by and construed in
accordance with the law of the province of British Columbia. The parties hereby
attorn to the jurisdiction of the Courts in the province of British Columbia.

 

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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the day
and year first above written.

 

PIVOT PHARMACEUTICALS INC.

 

Per: /s/ Ahmad Doroudian           

Authorized Signatory

 

 

/s/ Patrick Frankham                    

Patrick C. Frankham

 

 

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