Exhibit 10.9





 


CONSULTING AGREEMENT 


 


THIS
CONSULTING AGREEMENT (“Agreement”) is
made and shall be effective as of the 24th day of March, 2014 (the “Effective
Date”), by and between Capricor, Inc., a Delaware
corporation with its offices at 8840 Wilshire Blvd., 2nd Floor, Beverly Hills, California 90211 (“Capricor”)
and Frank Litvack, MD, whose address is c/o 8550 Wilshire Blvd., Ste. 840, Los Angeles,
California 90010  (“Consultant”).


 


 


RECITALS


 





A. Capricor
is engaged in research and development of stem-cell therapies for the treatment of cardiovascular disease.


 


B. Consultant
is a medical practitioner and businessman experienced in the development, operation and financing of medtech and biotech companies
in the healthcare industry.


 


C. Consultant
has been providing consulting services and advice to Capricor since 2010 and the parties are desirous of memorializing the terms
of Consultant’s continuing consulting relationship with Capricor.


 


 


NOW, THEREFORE, in
consideration of the mutual promises and covenants set forth in this Agreement and intending to be legally bound hereby, the parties
mutually agree as follows:


 


 


1. Engagement
of Consultant.


 


1.1 Engagement.
Capricor hereby agrees to continue the engagement of Consultant, and Consultant hereby agrees to accept such continuing engagement
with Capricor, to serve as an advisor and consultant to the management of Capricor and its parent, Capricor Therapeutics, Inc.,
(“CAPR”) and to provide such other consultation and advice as may be requested from time to time (collectively
the “Services”). In such capacity, Consultant shall use his best efforts and abilities in the performance of
the Services hereunder. Capricor may, from time to time, contract with the Consultant for other services and other specific projects
as may be agreed to by the parties.


 


1.2 Services
Non-Exclusive. During the continuance of this Agreement, it shall not be a violation of this Agreement for Consultant to
engage in other ventures or activities, whether existing now or in the future, including, but not limited to, rendering services
of a business, commercial, or professional nature to any other person or organization, whether for compensation or otherwise, as
long as such duties or pursuits do not materially interfere with the services required to be performed by Consultant hereunder.
If Consultant is engaged or desires to engage in other ventures or activities in the same or similar business in which Capricor
is engaged, Consultant shall disclose in writing to Capricor the nature and scope of such other business ventures or activities.
Capricor may terminate this Agreement if Capricor believes that Consultant’s participation in such venture or activity would
pose an actual or potential conflict of interest or would be materially detrimental to the business interests of Capricor. Consultant
shall disclose on Exhibit A, attached hereto, the names of each person or entity for whom Consultant provides services
which may present an actual or potential conflict of interest with Capricor. Such Exhibit A shall be updated regularly
by Consultant.


 






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Exhibit 10.9


 


2. Relationship
of the Parties. Consultant is an independent contractor and is not an agent, partner, joint venturer or employee of Capricor.
No provision of this Agreement shall be deemed to create or imply any contract of employment between Capricor and Consultant. In
his capacity as a consultant, Consultant shall have no authority to bind Capricor in any manner or create any liability for Capricor
unless authorized by the Board of Directors or Capricor’s Chief Executive Officer. Consultant shall not be treated as an
employee for purposes of the Federal Insurance Contributions Act, the Social Security Act, the Federal Unemployment Act, income
tax withholding and applicable state laws, including, without limitation, those pertaining to workers’ compensation, unemployment
compensation and state income tax withholding. Consultant acknowledges that he shall not be eligible for any pension, vacation,
sick pay or other benefits that Capricor may provide to its employees. Consultant is responsible for the payment of all required
taxes, whether federal, state or local in nature, including, but not limited to, income taxes, Social Security taxes, Federal Unemployment
Compensation taxes, and any other fees, charges, licenses or other payments required by law relating to Consultant’s engagement
by Capricor hereunder. Consultant shall indemnify Capricor and hold it harmless from and against all claims, demands, losses, costs,
liabilities, judgments, and attorneys’ fees that Capricor may incur that arise out of or relate to any failure of Consultant
to pay such taxes and/or contributions.


 


3.
Remuneration. As compensation for the Services rendered hereunder, Capricor will pay Consultant at the rate of ten thousand
dollars ($10,000) per month for the Services. Payments will be made on a monthly basis. Consultant shall report as income all compensation
received by him hereunder. 


 


4. Expenses.
Consultant will be reimbursed for such reasonable expenses for travel and lodging, necessary and actually incurred in the performance
of the Services, including, without limitation, costs actually incurred for any meeting that Capricor requests Consultant to attend;
provided, however, that in order to qualify for reimbursement, all such expenses must be approved in advance in writing by Capricor.
Consultant agrees to supply Capricor with receipts and such other supporting documentation requested by Capricor for all expenses
submitted for reimbursement. Payment for such expenses shall be made within the next check cycle, but not more than thirty (30)
days after receipt of supporting documentation.


 


5. Confidential
Information.


 


5.1 Consultant
has executed a Nondisclosure Agreement with Capricor dated January 30, 2013, a copy of which is attached hereto as Exhibit
B (the "NDA"). The terms and conditions of the NDA shall be incorporated herein by reference and
shall be deemed a part of this Agreement, applicable hereto and applicable to any confidential information received from CAPR as
well.


 


5.2 All Confidential
Information shall be the sole property of Capricor, its affiliates and its assigns, and Capricor, its affiliates and its assigns,
as applicable, shall be the sole owner of all patents and other intellectual property rights in connection therewith. Consultant
shall and does hereby assign to Capricor any rights Consultant may have or may acquire in such Confidential Information.


 


5.3 Except to
the extent reasonably necessary to perform the Services on behalf of Capricor, Consultant agrees to maintain in strictest confidence
and not to disclose or use, either during or at any time after the termination of this Agreement, any Confidential Information
belonging to Capricor, its affiliates or assigns, whether or not in written form, without first obtaining the written permission
of Capricor.


 






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Exhibit 10.9


 





5.4 Consultant
recognizes that Capricor has received and in the future will receive from third parties their confidential or proprietary information
subject to a duty on Capricor’s part to maintain the confidentiality of such information and, in some cases, to use it only
for certain limited purposes. Consultant agrees that it owes Capricor and such third parties, both during the term of this Agreement
and thereafter, a duty to hold all such confidential or proprietary information in the strictest confidence and not to disclose
it to any person, firm or corporation (except in a manner that is consistent with Capricor’s agreement with such third party)
or use it for the benefit of any person or entity other than Capricor or such third party (consistent with Capricor’s agreement
with such third party).


 


5.5 Upon the
termination of this Agreement, Consultant will deliver to Capricor (and will not keep in Consultant’s possession, recreate
or deliver to anyone else) any and all devices, records, data, notes, reports, proposals, lists, correspondence, specifications,
drawings, blueprints, sketches, materials, equipment, computer disks other documents, materials or property, together with all
copies thereof (in whatever medium recorded) belonging to Capricor, its affiliates, licensors, successors or assigns.


 


5.6 Unless the
prior written consent of Capricor has been obtained, Consultant shall not discuss or mention in scientific publications, medical
literature, abstracts or verbal presentations any information regarding Capricor, including, without limitation, any information
related to Capricor’s business, products, processes, data, plans, strategies or Confidential Information, unless such information
is in the public domain not by reason of a breach of any confidentiality obligation owed to Capricor.


 


6. Property Rights
of the Parties


 


6.1 As used
in this Agreement, the term “Inventions” shall refer to any new or useful art, discovery, development, contribution,
finding or improvement whether or not patentable, and all related know-how. Inventions include, but are not limited to, all trade
secrets, designs, discoveries, formulae, processes, methods, manufacturing techniques, computer software, improvements, and ideas.


 


6.2 Consultant
will promptly disclose, and hereby assigns, to Capricor, all right, title and interest worldwide of Consultant in and to all Inventions,
which have been or shall be made, conceived, learned, or reduced to practice or writing by Consultant, either alone or with others
in connection with or related to Capricor’s products and processes during the continuance of this Agreement or after the
termination hereof. Consultant acknowledges that all original works of authorship which are made by Consultant (solely or jointly
with others) in the performance of the Services and which are protected by copyrights are “works made for hire,” as
that term is defined in the United States Copyright Act (17 U.S.C., Section 101).


 


6.3 Consultant
will, both during and after termination of this Agreement, assist Capricor, at Capricor’s expense, in every proper manner
to obtain for Capricor and to maintain and enforce, in any and all countries, patents and copyrights on all of Capricor’s
Inventions assigned by Consultant to Capricor, and for such purpose Consultant shall sign all documents related to such of Capricor's
Inventions as Capricor may reasonably request. In the event that Capricor is unable for any reason whatsoever to secure Consultant’s
signature to any lawful and necessary document required to apply for or execute any copyright or patent application with respect
to any Capricor Invention requiring an assignment by Consultant hereunder, Consultant hereby irrevocably designates and appoints
Capricor and its duly authorized officers and agents as its agents and attorneys-in-fact to act for and in its behalf and instead
of Consultant, to execute and file any such application and to do all other lawfully permitted acts to further the prosecution
and issuance of patents, copyrights or other rights thereon with the same legal force and effect as if executed by Consultant.


 






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Exhibit 10.9


 


7.
Termination.  


 


7.1 Term/Termination.
Subject to earlier termination as provided herein, this Agreement shall commence on the Effective Date and shall continue in force
until terminated by one of the parties hereto. Consultant shall have the right to terminate this Agreement at any time after giving
Capricor at least seven (7) days’ prior written notice with or without cause; (b) Capricor shall have the right to terminate
this Agreement upon thirty (30) days’ written notice to Consultant with or without cause; and (c) Capricor shall have the
right to immediately terminate this Agreement upon notice to Consultant upon the occurrence of any Termination Event (as defined
below).


 


7.2 For purposes
of this Agreement, the term “Termination Event” shall mean the occurrence of any of the following:


 


		(a)	The commission of an act of fraud or dishonesty by Consultant;



 


		(b)	The unauthorized use or disclosure of Confidential Information
by Consultant;



 


		(c)	The willful or habitual neglect by Consultant in the
performance of the  Services;



 


		(d)	Consultant is convicted of a felony or other crime involving
moral turpitude; and



 


		(e)	Any other conduct by Consultant which is injurious to
the business or reputation of Capricor.



 


8. Assignability.
This Agreement is personal between Consultant and Capricor. Consultant shall not assign Consultant’s rights or delegate
his duties under this Agreement, in whole or in part, without the prior written consent of Capricor, which consent can be withheld
at Capricor’s sole discretion. Capricor shall have the right to assign its rights and delegate its duties under this Agreement
in whole or in part to a successor to Capricor without the consent of Consultant.


 


9.
Compliance with Business Ethics and Laws 


 


9.1
Ethical Conduct. It is the policy of Capricor to conduct its business at all times in accordance with the highest standards
of corporate, business and medical ethics. Consultant agrees to comply with those standards in all matters relating to the Services
and all other performance under or pursuant to this Agreement. 


 


9.2 Compliance
with Laws. Consultant shall comply with all applicable laws affecting this Agreement and his performance hereunder and,
without limiting the generality of the foregoing, shall maintain all licenses which may be required under local law in order to
enable him lawfully to perform his obligations under this Agreement.


 


9.3 Anti-bribery
and Anti-Corruption Cause. Consultant confirms that he has not given or promised to give, will not give or promise to give
any payment or anything of value, directly or indirectly, to any government, public institution, public international organization
or public official in connection with this Agreement for the purpose of obtaining or retaining business or any other improper advantage.
Consultant represents that no payment made under this Agreement is intended to influence any government, public institution, public
international organization or public official with regard to the sale of Capricor’s products or the conduct of its trials.
Each party represents that no payment made to the other pursuant to this Agreement proceeds of any illegal activity.


 






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Exhibit 10.9


 


9.4 Materiality.
Non-compliance by Consultant with the provisions of this Section 9 shall constitute a material breach of this Agreement and shall
constitute grounds for its termination in accordance with Section 7.2 hereof.


 


10. General Provisions.



 


10.1 Notices.
Any notices to be given by either party to the other may be effected either by personal delivery in writing, by facsimile or electronic
transmission, courier or by mail, registered or certified, postage prepaid. Mailed notices shall be addressed to the parties at
the addresses appearing in the introductory paragraph of this Agreement, but each party may change its address by written notice
in accordance with this section. Notices personally delivered, sent by courier or sent by facsimile or electronic transmission
shall be deemed communicated as of the date of actual receipt; mailed notices shall be deemed communicated two (2) days after the
date on which they are mailed.


 


10.2 Agreement
Binding. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective
heirs, representatives, successors and permissible assigns.


 


10.3 Severability.
If any covenant, condition or other provision contained in this Agreement is held to be invalid, void or unenforceable by any court
of competent jurisdiction, the same shall be deemed severable from the remainder of this Agreement and shall in no way affect,
impair or invalidate any other covenant, condition or other provision contained herein. If such condition, covenant or other provision
shall be deemed invalid due to its scope or breadth, such covenant, condition or other provision shall be deemed valid to the extent
of the scope or breadth permitted by law.


 


10.4 Interpretation
of Agreement. No provision of this Agreement is to be interpreted for or against either party because that party or that
party’s legal representative drafted such provision.


 


10.5 Entire Agreement.
This Agreement and the NDA set forth the entire agreement and understanding of the parties relating to Consultant’s consulting
relationship with Capricor. No representation, promise or inducement has been made by either party that is not embodied in this
Agreement and the NDA, and neither party shall be bound by or liable for any alleged representation, promise or inducement not
so set forth. Except as set forth herein, all prior negotiations, representations and agreements are waived, merged herein and
superseded hereby. Notwithstanding the foregoing, nothing in this Agreement is intended to supersede, waive or nullify any agreement
previously entered into between Capricor and Consultant, including, without limitation, Stock Option Agreements, which shall remain
in full force and effect.


 


10.6 Governing
Law. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of California.
The state and federal courts of the State of California in Los Angeles County shall have exclusive jurisdiction to determine any
controversies arising in connection with this Agreement or the relationship of the parties.


 






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Exhibit 10.9


 


10.7 Modifications.
No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by each of the parties.


 


10.8 Waiver.
No waiver of any of the provisions of this Agreement shall be deemed, or shall constitute, a waiver of any other provision, whether
or not similar, nor shall any waiver constitute a continuing waiver. No waiver shall be binding unless executed in writing by the
party making the waiver. The failure of either party at any time or times to require performance of any provision hereof shall
in no manner affect the party’s right at a later time to enforce the same.


 


 10.9 Survival. Notwithstanding
any provision of this Agreement to the contrary, the provisions of Sections 2, 5, 6, and 10 (and each of their subsections) shall
survive the expiration or termination of this Agreement as necessary to give full effect to all of the provisions contained herein.


 


 


IN WITNESS WHEREOF,
the parties have executed this Agreement on the date(s) set forth below.


 





	CAPRICOR, INC.	 	 CONSULTANT 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	By:	/s/ Linda
    Marban	 	/s/ Frank Litvack
	Linda Marbán, Chief Executive Officer	 	Frank Litvack, MD.
	 	 	 	 
	 	 	 	 
	Date:___March 24, 2014 	 	Date: March 21, 2014


 






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Exhibit 10.9


 





EXHIBIT A


 





 


CONSULTANT’S DISCLOSURE OF OTHER


 


ACTIVITIES AND
OWNERSHIP INTERESTS


 


POSING ACTUAL AND POTENTIAL CONFLICTS
OF INTEREST


 


 





 


 


1. ___________________________________________________________________________


 


 


 


2. ____________________________________________________________________________


 


 


 


3. ____________________________________________________________________________


 


 


 


4. ____________________________________________________________________________


 


 


 


5. ____________________________________________________________________________


 






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EXHIBIT B


 


 


 


NONDISCLOSURE AGREEMENT


 






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