Document:

ex4.htm

Exhibit 10.3

 

 

Covenant Agreement

 

This Covenant Agreement (the “Agreement”), dated and effective as of July 10, 2017, is made by and between Milestone Scientific Inc., a Delaware corporation (together with its successors and affiliates, the “Company”) and Daniel Goldberger (the “Executive”). This Agreement is entered into pursuant to the Employment Agreement dated July 10, 2017 between the Company and Executive regarding Executive’s employment with the Company (as amended from time to time, the “Employment Agreement”). As used herein, the term “Company” shall include the Company and its direct and indirect subsidiaries. Other capitalized terms used but not defined in this Agreement have the meanings ascribed to them on Annex 1 attached hereto.

 

	
			1.

				
			Nondisclosure of Proprietary Information.

			

 

	
			(a)

				
			Except in connection with the faithful performance of the Executive’s duties under the Employment Agreement and as provided herein, the Executive shall, in perpetuity, maintain in confidence and shall not directly, indirectly or otherwise, use, disseminate, disclose or publish, or use for the Executive’s benefit or the benefit of any person, firm, corporation or other entity any Proprietary Information or deliver to any person, firm, corporation or other entity any document, record, notebook, computer program or similar repository of or containing any such Proprietary Information. The parties hereby stipulate and agree that as between them the Proprietary Information is important, material and affects the successful conduct of the businesses of the Company (and of any successor or assignee of the Company). The Executive acknowledges and agrees that these steps to maintain the confidentiality of its Proprietary Information are reasonable and that it is reasonable and necessary for the Company to take such steps. 

			

 

	
			(b)

				
			Upon termination of the Executive’s employment with the Company for any reason, the Executive will promptly deliver to the Company all correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, computer disk drives, flash drives, disks, or any other materials consisting of, including or relating to Proprietary Information in his possession.

			

 

	
			(c)

				
			Notwithstanding the foregoing, the Executive may respond to a lawful and valid subpoena or other legal or administrative process but: (i) shall give the Company the earliest practicable notice thereof, (ii) shall, as much in advance of the return date as practicable, make available to the Company and its counsel the documents and other information sought and (iii) shall assist such counsel at the Company’s expense in resisting or otherwise responding to such process.

			

 

	
			(d)

				
			Nothing in this Agreement shall prohibit the Executive from (i) disclosing information and documents when required by law, subpoena, court or administrative order (subject to the requirements of Section 1(c) above), (ii) disclosing information and documents related to his own personal benefits, entitlements and obligations in confidence to his attorney or tax or financial adviser for the purpose of securing legal or tax advice, (iii) disclosing the post-employment restrictions in this Agreement in confidence to any potential new employer, (iv) reporting possible violations of federal law or regulations to any governmental agency or entity, including but not limited to the Department of Justice, the Securities and Exchange Commission or making other disclosures that are protected under the whistleblower provisions of federal or state law or regulations or (v) retaining, at any time, his personal correspondence, his personal rolodex and documents related to his own personal benefits, entitlements and obligations.

			

 

 

 

 

	
			2.

				
			Non-Solicitation; Non-Compete; Non-Disparagement

			

 

	
			(a)

				
			At any time during the term of his employment with the Company (the “Employment Period”) and for a period of twenty-four (24) months immediately following the end of the Employment Period, the Executive shall not, directly or indirectly, either for himself or on behalf of any other person, firm, corporation or other entity, (i) recruit or otherwise solicit, encourage or induce any employee, client, customer or investor of any Company Party to terminate such person or entity’s employment or other arrangement with a Company Party, or otherwise to change such person or entity’s relationship with a Company Party, (ii) hire or offer to employ or retain or offer to retain as a consultant or advisor or in any other capacity (or cause or influence any other person or entity to hire or offer to employ or retain or offer to retain as a consultant or advisor or in any other capacity) any person who was employed by the Company in a similar capacity as such person is employed by the Company in a manner which would deprive the Company of the services of such person or (iii) cause or seek to cause any client or customer of, or investor in, any Company Party to become a client or customer of, or investor in, any business or activity that competes with the Business and in which the Executive becomes engaged (directly or indirectly) or otherwise has a financial interest.

			

 

	
			(b)

				
			At any time during the Employment Period and for a period of twelve (12) months immediately following the end of the Employment Period, the Executive shall not, directly or indirectly, either for himself or on behalf of any other person, firm, corporation or other entity, shall not, directly or indirectly; (i) in any manner, engage in any business which competes with any business conducted by the Company (including any subsidiary) and will not directly or indirectly own, manage, operate, join, control or participate in the ownership, management, operation or control of, or be employed by or connected in any manner with any corporation, firm or business that is so engaged (provided, however, that nothing herein shall prohibit the Executive from owning not more than three percent (3%) of the outstanding stock of any publicly held corporation).

			

 

	
			(c)

				
			The Executive agrees not to make any disparaging remarks about any Company Party, or any of their practices, or any Company Party’s directors, managers, officers, equity holders or trustees either orally or in writing, at any time. 

			

 

	
			3.

				
			Inventions and Other Works. During the Employment Period, the Executive may either alone or with others, author, create, conceive or develop or reduce to practice, or cause to be conceived or developed or reduced to practice, or assist in the authoring, creation, conception, development or reduction to practice of documents, materials, designs, drawings, processes, Proprietary Information and other works which relate to the Business or are otherwise capable of being used by a Company Party (“Works”). The Executive agrees that any and all Works and the related intellectual property and other rights in those Works including, without limitation, inventions, patents, copyrights, mask works, design rights, database rights, trademarks, service marks, internet rights/domain names, trade secrets and know-how (whether registered or unregistered and including any applications or rights to apply) subsisting anywhere in the world in any and all media now existing or hereafter created (collectively, “Works IP Rights”) will belong solely to and be the absolute property of the relevant Company Party. The Executive agrees that all original works of authorship which are made by the Executive (solely or jointly with others) within the scope of and during the period of his employment with the Company and which are protectable by copyright are “works made for hire,” as that term is defined in the United States Copyright Act. The Executive hereby assigns with full title guarantee to the Company (on behalf of the applicable Company Party) by way of present assignment of all Works IP Rights, all intellectual property rights in the Works. The Executive hereby irrevocably and unconditionally waives any moral rights which he may have in any Works. The Executive shall immediately disclose to the Company all Works and all Works IP Rights, and shall immediately on request by the Company (whether during or after the termination of his or her Employment Period) and at the expense of the Company (on behalf of the applicable Company Party) execute all instruments and do all things necessary for vesting in the Company (or such other person as the Company may designate) all right, title and interest to and in the Works and Works IP Rights and as otherwise necessary for giving to the Company (on behalf of the applicable Company Party) the full benefit of this clause. Notwithstanding the foregoing, Works and Works IP Rights does not apply to any invention for which no equipment, supplies, facility, or trade secret information of a Company Party was used and which was developed entirely on the Executive’s own time, unless (a) the invention relates (i) to the Business, or (ii) to the Company Party’s actual or demonstrably anticipated research or development, or (b) the invention results from any work performed by the Executive for any Company Party. 

			

 

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			4.

				
			Patent and Copyright Registrations. The Executive agrees to assist any Company Party, or its designee, at the Company’s expense (on behalf of the applicable Company Party), in every proper way to secure the Company Party’s rights in the inventions and any copyrights, patents, mask work rights or other intellectual property rights relating thereto in any and all countries, including the disclosure to the Company Party of all pertinent information and data with respect thereto, the execution of all applications, specifications, oaths, assignments and all other instruments which the Company Party shall deem necessary in order to apply for and obtain such rights and in order to assign and convey to the Company Party, its successors, assigns, and nominees the sole and exclusive rights, title and interest in and to such Inventions, and any copyrights, patents, mask work rights or other intellectual property rights relating thereto. The Executive further agrees that his obligation to execute or cause to be executed, when it is in his power to do so, any such instrument or papers shall continue after the termination of this Agreement. If the Company Party is unable because of mental or physical incapacity or for any other reason to secure such Company Party’s signature to apply for or to pursue any application for any United States or foreign patents or copyright registrations covering Inventions or original works of authorship assigned to the Company Party as above, then the Executive hereby irrevocably designates and appoints the Company and its duly authorized officers and agents as his agent and attorney-in-fact, to act for and in his or her behalf and stead to execute and file any such applications and to do all other lawfully permitted acts to further the prosecution and issuance of letters patent or copyright registrations thereon with the same legal force and effect as if executed by the Executive. 

			

 

	
			5.

				
			Injunctive Relief. It is recognized and acknowledged by the Executive that a breach of one or more of the covenants contained in Sections 1 and 2 may cause irreparable damage to the Company and its goodwill, the exact amount of which will be difficult or impossible to ascertain, and that the remedies at law for any such breach may be inadequate. Accordingly, the Executive agrees that in the event of a breach or threatened breach of any of the covenants contained in Sections 1 or 2, in addition to any other remedy which may be available at law or in equity, the Company shall be entitled to seek injunctive relief and special performance to prevent or prohibit such breach. The Executive agrees to waive any requirements for the securing or posting of any bond in connection with such remedy.

			
	 	 
	
			6.

				
			Tolling In the event of the breach by the Executive of any covenants contained in Sections 2 the running of the applicable period of restriction shall be automatically tolled and suspended for the amount of time that the breach continues, and shall automatically recommence when the breach is remedied so that the Company shall receive the benefit of the Executive’s compliance with such covenants. 

			

 

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			8.

				
			Assignment and Successors. The Company may assign its rights and obligations under this Agreement to any successor to all or substantially all of the business or the assets of the Company (by merger or otherwise), and may assign or encumber this Agreement and its rights hereunder as security for indebtedness of the Company and its affiliates. This Agreement shall be binding upon and inure to the benefit of parties to this Agreement and their respective heirs, executors, administrators, personal and legal representatives, successors and assigns. None of the Executive’s rights or obligations may be assigned or transferred by the Executive, other than the Executive’s rights to payments hereunder, which may be transferred only by will or operation of law. 

			

 

	
			9.

				
			Governing Law. This Agreement shall be governed, construed, interpreted and enforced in accordance with its express terms, and otherwise in accordance with the substantive laws of the State of New York, without reference to the principles of conflicts of law or choice of law of the State of New York or of any other jurisdiction, and where applicable, the laws of the United States. 

			

 

	
			10.

				
			Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, but all of which together will constitute one and the same Agreement. Signatures delivered by facsimile shall be deemed effective for all purposes. 

			

 

	
			11.

				
			Entire Agreement. The terms of this Agreement and the Employment Agreement are intended by the parties to be the final expression of their agreement with respect to the subject matter hereof and to supersede all prior understandings and agreements, whether written or oral. The parties further intend that this Agreement shall constitute the complete and exclusive statement of their terms and that no extrinsic evidence whatsoever may be introduced in any judicial, administrative, or other legal proceeding to vary the terms of this Agreement. 

			

 

	
			12.

				
			Amendments; Waivers. This Agreement may not be modified or amended except by an instrument in writing, signed by you and the Chairman of the Board of the Company. By an instrument in writing similarly executed, you or the Company may waive compliance by the other party or parties with any specifically identified provision of this Agreement that such other party was or is obligated to comply with or perform; provided, however, that such waiver shall not operate as a waiver of, or estoppel with respect to, any other or subsequent breach or failure to comply or perform. No failure to exercise and no delay in exercising any right, remedy, or power hereunder shall preclude any other or further exercise of any other right, remedy, or power provided herein or by law or in equity. Except as otherwise set forth in this Agreement, the respective rights and obligations of the parties under this Agreement shall survive any termination of the Executive’s employment by the Company.

			

 

	
			13.

				
			Dispute Resolution. Any dispute or controversy arising under or in connection with this Agreement shall be settled exclusively in accordance with the provisions of Section 5 of this Agreement and Section 6 of the Employment Agreement.

			
	 	 
	
			14.

				
			Enforcement If any term, provision, covenant or condition of this Agreement is held by a court of competent jurisdiction to exceed the limitations permitted by applicable law, as determined by such court in such action, then the provisions will be deemed reformed to the maximum limitations permitted by applicable law and the parties hereby expressly acknowledge their desire that in such event such action be taken. If any provision of this Agreement is held to be illegal, invalid or unenforceable during the term of this Agreement after application of the first sentence of this Section 14, then such provision shall be fully severable; this Agreement shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a portion of this Agreement; and the remaining provisions of this Agreement shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance from this Agreement. Furthermore, in lieu of such illegal, invalid or unenforceable provision there shall be added automatically as part of this Agreement a provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and be legal, valid and enforceable.

			 

			

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IN WITNESS WHEREOF, the parties have executed this Covenant Agreement on the date and year first above written.

 

	
			 

				
			The Company:

			 

			MILESTONE SCIENTIFIC INC.

				
			 

			
	
			 

				
			 

				
			 

				
			 

			
	
			 

				
			 

				
			 

				
			 

			
	
			 

				
			By: 

				/s/ Joseph D'Agostino	
			 

			
	
			 

				
			 

				
			Joseph D'Agostino,

				
			 

			
	
			 

				
			 

				
			Chief Financial Officer

				
			 

			

 

The Executive: 

 

 

 

/s/ Daniel S. Goldberger             

Daniel S. Goldberger

 

5

 

 

ANNEX 1

 

Defined Terms

 

“Business” means all commercial activities of the Company.

 

“Company Party” means the Company and the Company’s clients.

 

“Proprietary Information” means and includes any confidential or proprietary information, trade secrets or intellectual property of or relating to any Company Party; provided, however, that Proprietary Information does not include information which (i) becomes publicly available, other than by disclosure by the Executive in violation of this Agreement, (ii) is contained in a publicly available document or (iii) was known to the Executive before the Executive commenced discussion with the Company regarding the prospect of employment by the Company.STEM CELL LAB DEVELOPMENT AGREEMENT

 

 This STEM CELL LAB DEVELOPMENT AGREEMENT (this “Agreement”) made the 6th day of July, 2017 , by and between DaVinci Centre for Wellness and Alternative Therapies, formed and organized under the laws of the Cayman Islands (“DaVinci”), Halo Cell Sciences, Ltd, a Cayman Islands corporation (“Cell Sciences”), and Vitro Diagnostics, Inc., a Nevada corporation (“Vitro”). DaVinci, Cell Sciences, and Vitro are sometimes referred to herein collectively as the “Parties ” and each individually as a “Party.” This signed Stem Cell Development Agreement shall become effective upon the minimum sufficient funding in the amount of $1,500,000 being raised by Vitro and the completion of the items detailed in the “Terms of Agreement” laid out below. 

 

RECITALS 

  

 WHEREAS, Vitro and Cell Sciences plan to develop and operate a fully functioning  stem cell laboratory on Grand Cayman (the “Lab”); 

  

 WHEREAS, DaVinci has agreed to provide services in connection with the creation and operation of the Lab as described herein.   

 

 NOW, THEREFORE, in consideration of the mutual premises and covenants set forth herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows. 

 

1.   Services to Be Provided By DaVinci.  In connection with the development and operation of the Lab, DaVinci agrees to provide the following consulting and support services (the “Services”) to Cell Sciences, on an on-going and as-needed basis: 

 

 a.   Licensed and Registered Healthcare Facility (DaVinci Centre Cayman Islands) Health Practice Commission of the Cayman Islands, for Stem Cell Transplant.   

 

 b.  Staffing of qualified and registered healthcare personnel for the      transplant of autologous or allogeneic MSC at the Da Vinci Wellness Centre. 

 

 c.  Patient Customer Service, screening, eligibility, support and follow up with respective international physicians. 

 

 d. Institutional Review Board (“IRB”) Approval for the use of fat derived autologous MSC for the clinical trial for the medical condition of multiple sclerosis, pending the transfer of the present IRB to include Vitro as the laboratory expanding cells, and submission of the Standard Operating Procedures (“SOP”) of Vitro. 

 

 e.  Institutional Review Board (IRB) Approval for the use of fat derived autologous MSC or Allogeneic Cells for the clinical trial regarding chronic low grade inflammation and stem cells as an immune modulator targeting inflammation, pending the transfer of the present IRB to Vitro as the laboratory for cell expansion, and submission the SOPs of Vitro. 

 

 f.  Future IRB approved clinical trials, on an on-going basis. 

 g.  Collaborate with Vitro, on an on-going basis, to create new and innovative clinical and scientific applications. 

 

 h.  Approved Certification to engage in clinical trials using autologous and allogeneic MSC (Cayman Islands) for both the Health Facility (The DaVinci Centre) and DaVinci Cayman Islands Registered Physicians. 

 

 i. Consulting and Support of newly established Stem Cell Laboratory, with Senior Managerial Control/ Oversight of the day-to-day operations (in collaboration with Cell Sciences executive staff). 

 

 j. Medical Directorship, as per Health Practice Commission of the Cayman Islands Regulations, for the applications and operation of a Registered Cayman Islands Health Facility (stem cell lab). 

 

 k.  Consult and support for marketing and promotion of a cellular therapy entity.(name to be determined) in collaboration with Cell Sciences executive staff. 

 

 l.  Consult and support for the development and marketing of nutraceutical products in collaboration with Cell Sciences executive staff. 

.

2.   Term of Agreement. This Agreement shall commence on the Effective Date set forth above and continue for a period of ten (10) years, unless sooner terminated as provided herein (the “Term”). The Effective Date of this Agreement shall be simultaneous to the date that Vitro consummates an equity funding in an amount not less than $1.5 million and is contingent upon the completion of the following items: 

 

 a.  Halo Cell Science, ( or name to be determined),  will operate under the direction/supervision of Da Vinci Management/Board of Directors and all operational decisions would be subject to approval by the CEO of Da Vinci. Da Vinci shall have the right, at its expense, to inspect and audit the books and records of Halo Cell Science to confirm such information. 

                        b.  A separate governing Board of Directors belonging to and provided full oversight/day-to-day control over Halo Cell Sciences, Ltd. Control including, but not limited to, Cell Sciences marketing, hiring, administrative, and financial decisions in the Cayman Islands. The board will consist of two positions to be nominated by Vitro, two positions to be nominated by DaVinci, and one Chairman. The CEO of Da Vinci will reserve the discretionary right to have the casting vote/Tie-Breaker position.  

 

 c.     Frank Cona be appointed in a salaried position as CEO, and Chairman of the Board of Cell Sciences to oversee all operations within the Cayman Islands.( in Accordance with section 2.a under Terms of Agreement). In addition, Frank Cona be appointed on the Board of Directors of Vitro to serve as the link between Vitro and Cell Sciences.    

 d.     One-time transfer of raised funds to Cell Sciences from Vitro for the purpose of completing an initial marketing/advertising campaign, hiring of employees, setup of the Lab, and associated fees. The amount of funds transferred will be in accordance with projections of said items at the time of execution and agreed upon before this agreement goes into effect.  

                       e. Vitro/ Halo Cell Science agrees to pursue and execute the concept of creating a fully functional stem cell laboratory on Grand  Cayman (the “Lab”) within one year of signing this agreement;

 

3.   Fees. In consideration of the Services to be provided by DaVinci hereunder, Cell Sciences and Vitro shall pay to DaVinci the following fees:  

 

 a.  As a one-time retainer fee, Vitro shall issue to DaVinci such number of shares of a newly declared series of Vitro preferred stock that shall convert, at the holder’s option, into a total 21,000,000 shares of Vitro common stock (the “Retainer Shares”).  The Retainer Shares shall be subject to vesting as set forth below.  The certificate of designation for the preferred shares will contain customary anti-dilution protection for stock splits, dividends and the like. 

 

 b. As further consideration for providing the on-going Services provided by DaVinci, DaVinci shall pay to Cell Sciences an amount equal to sixty percent (60%) (the “Services Fee”) of the net revenues received by DaVinci derived from performing stem cell transplant therapies on patients at the Lab (the “Net Revenue”).  Within 15 days following the end of each calendar month, upon request, DaVinci shall provide Cell Sciences with written reports providing a detailed accounting of the Net Revenue during such month together with the Services Fee for such month.  Cell Sciences shall have the right, at its expense, to inspect and audit the books and records of DaVinci to confirm such information. 

 

 c.   Vitro shall issue to Frank Cona as CEO of Cell Sciences such number of shares of a newly declared series of Vitro preferred stock that shall convert, at the holder’s option, into a total 8,000,000 shares of Vitro common stock. The certificate of designation for the preferred shares will contain customary anti-dilution protection for stock splits, dividends and the like.   

d.  In addition, Vitro shall issue to Dr. Scott David as the only other licensed physician at the DaVinci Center, such number of shares of a newly declared series of Vitro preferred stock that shall convert, at the holder’s option, into 1,000,000 shares of Vitro common stock (the “David Bonus Shares”).  500,000 of the David Bonus Shares will vest immediately and the balance will vest on a monthly basis over a four (4) year period, in accordance with the terms of a separate Employment Agreement between DaVinci and Dr. Scott David.

 

4.  Vesting.  The Retainer Shares shall vest over a four (4) year period, with Retainer Shares representing 10,000,000 shares of Vitro Common Stock vesting upon the execution hereof and with the balance vesting, at a rate of 1/48th of the total number Retainer Shares not vested upon the execution hereof, per month.  All Retainer Shares which have vested (the “Vested Shares”) shall not be subject to the provision of Section 5(c) below.  Notwithstanding anything to the contrary contained in this Section 4, all unvested Retainer Shares shall immediately be deemed to be vested in the event that there shall be: (a) a merger, consolidation or other reorganization of Vitro unless securities representing more than fifty percent (50%) of the total combined voting  

power of the voting securities of the successor corporation are immediately thereafter beneficially owned, directly or indirectly and in substantially the same proportion, by the persons who beneficially owned Vitro outstanding voting securities immediately prior to such transaction, or (b) the sale, transfer or other disposition of all or substantially all of Vitro assets, (c) the acquisition, directly or indirectly by any person or related group of persons of securities possessing more than fifty percent (50%) of the total combined voting power of Vitro’s outstanding securities other than in connection with the financing of the Lab, or (d) Vitro shall terminate this Agreement other than For Cause, as defined below. 

5.   Termination. Except as otherwise expressly provided herein, this Agreement may be terminated (for purposes of this paragraph 5, Vitro and Cell Sciences shall be considered as a single party):  

 a.  upon mutual written agreement of the parties, or  

 b.  by the non-defaulting party upon or after the occurrence (but solely upon or after such occurrence) of any one of the following events (each, an “Event of Default”): (i) a material breach by the other party of any terms or conditions of this Agreement which (A) is not corrected within thirty (30) days after receipt of written notification thereof, if correctable within such thirty (30) days, or (B) if it is not correctable within such thirty (30) days, the correction of which is not initiated within such thirty (30) day period and thereafter diligently pursued until completed; or (ii) one of the parties hereto shall go into liquidation, a receiver or a trustee appointed for the property or estate of that party and said receiver or trustee is not removed within one hundred twenty (120) days, or the party makes an assignment for the benefit of creditors, whether any of the aforesaid bankruptcy events be the outcome of the voluntary act of that Party, or  

 c.  Vitro/Cell Sciences may terminate this Agreement “For DaVinci Cause” in the event that: (i) DaVinci shall commit a material breach of this Agreement which breach shall remain uncured for a period of thirty (30) days after written notice by Vitro/Cell Sciences of such breach and such breach has a material negative effect on the business of the Lab, (ii) DaVinci, or any of its affiliates, is convicted of any felony or is shown to have engaged in any act of dishonesty detrimental to Vitro or fraud upon Vitro, or any of its affiliated companies, or any of its customers, patients or clients, (iii) DaVinci has been grossly negligent in the performance of his duties or responsibilities and such breach has a material negative effect on the business of the Lab, or (iv) DaVinci shall engage in or aid and abet any violation of any US federal or state securities law.  In the event that Vitro shall terminate this Agreement For DaVinci Cause, all Retainer Shares which have not vested pursuant to Section 4 above shall be deemed cancelled.  

 d. DaVinci may terminate this Agreement “For Vitro Cause” in the event that: (i) Vitro/Cell Sciences shall commit a material breach of this Agreement which breach shall remain uncured for a period of thirty (30) days after written notice by DaVinci of such breach and such breach has a material negative effect on the business of the Lab or DaVinci, (ii) Vitro/Cell Sciences, or any of its affiliates, is convicted of any felony or is shown to have engaged in any act of dishonesty detrimental to the Lab or DaVinci, or fraud upon DaVinci, or any of its affiliated companies, or any of its customers, patients or clients, (iii) Vitro/Cell Sciences has been grossly negligent in the performance of its duties or responsibilities and such breach has a material negative effect on the business of the Lab, or (iv) Vitro/Cell Sciences shall engage in or aid and  

abet any violation of any US federal or state securities law.  In the event that DaVinci terminates this Agreement For Vitro Cause, all Retainer Shares which have not vested shall be deemed to be immediately vested.  

 In the event of a termination as a result of an Event of Default, the non-defaulting Party shall be entitled to pursue any remedy provided in law or equity, including the right to recover any damages it may have suffered by reason of such Event of Default. Upon a termination of this Agreement, the terms and conditions of this Agreement that, by their terms, require performance following the termination or expiration of this Agreement shall survive such  

6.   Inventions.  DaVinci and Vitro shall jointly own all statutory and/or common law rights to the extent those rights are exercised in the United States; DaVinci and Cell Sciences  shall jointly own all statutory and/or common law rights throughout the world outside of the United States.  “Rights” as used herein means (i) all patents and applications therefor, and all reissues, divisions, renewals, extensions, provisionals, continuations and continuations-in-part thereof; (ii) all ideas and inventions (whether or not patentable or reduced to practice), invention disclosures and improvements, all trade secrets, proprietary information, know-how and technology; (iii) all works of authorship, copyrights, and copyright registrations and applications and (iii) all other forms of technology, including all know-how, show-how, methods, models, techniques, designs, design rules, network configurations and architectures, diagrams, documentation, drawings, flow charts, formulae, algorithms, specifications, routines, subroutines, materials, Software, procedures, processes, protocols, devices, prototypes, schematics, test methodologies, software and hardware development tools developed by DaVinci in connection with the Services provided by DaVinci to Vitro hereunder. 

 

7. Non-Competition.  DaVinci agrees that during the term hereof, DaVinci shall not establish, create or utilize any other laboratory with regard to obtaining stem cells for transplant in the Cayman Islands. This non-competition provision shall not apply to (a) any stem cells provided directly by patients of DaVinci and (b) any existing relationships that DaVinci has in place for the treatment of patients as of the date hereof.  Vitro agrees that during the term hereon, Vitro shall not establish any business which competes with Cell Sciences or DaVinci in the Cayman Islands. 

 

8.  Representations and Agreements of DaVinci. DaVinci hereby represents, warrants and covenants with Vitro and Cell Sciences that:  

 

 a.  DaVinci is a corporation duly organized, validly existing, and in good standing under the laws of the Cayman Islands;  

 

 b.   DaVinci has all requisite corporate power and authority to own, lease, and operate its properties and its business and to enter into and perform its obligations hereunder;  

 

 c. The execution, delivery, and performance of this Agreement by DaVinci has been duly authorized by all requisite corporate action on the part of DaVinci. This Agreement has been duly executed and delivered by DaVinci and constitutes the legal, valid and binding obligation of DaVinci, enforceable against DaVinci in accordance with its terms, except to the extent that enforceability may be limited by applicable bankruptcy, insolvency, or similar laws affecting the enforcement of creditors’ rights generally and subject to general principals of equity; 

 d.  DaVinci agrees to maintain, at its own expense, all legal, governmental and regulatory approvals, licenses and permits necessary to provide the Services. 

 

 e.  DaVinci’s performance of services will not breach any agreement that DaVinci has with another party including, without limitation, any agreement to keep in confidence proprietary information acquired by DaVinci in confidence;  

 

 f.  DaVinci is not and will not be bound by any agreement, nor has assumed or will assume any obligation, which would in any way be inconsistent with the services to be performed by DaVinci under this Agreement; and  

 

 g.  DaVinci will perform all services in a professional and workmanlike and diligent manner.  

 

9.  Representations of Vitro. Vitro hereby represents and warrants to DaVinci that: 

 

 a.  Vitro is a corporation duly organized, validly existing, and in good standing under the laws of the State of Nevada;  

 

 b.  Vitro has all requisite corporate power and authority to own, lease, and operate its properties and business and to enter into and perform its obligations hereunder;  

 

 c.  The execution, delivery, and performance of this Agreement by Vitro have been duly authorized by all requisite corporate action on the part of Vitro; and  

 

 d.  This Agreement has been duly executed and delivered by Vitro and constitutes the legal, valid, and binding obligation of Vitro, enforceable against Vitro in accordance with its terms, except to the extent that enforceability may be limited by applicable bankruptcy, insolvency, or similar laws affecting the enforcement of creditors’ rights generally and subject to general principles of equity.  

 

10.   Representations of Cell Sciences  Cell Sciences hereby represents, warrants and covenants with DaVinci that: 

 

 a.  Cell Sciences is a corporation duly organized, validly existing, and in good standing under the laws of the Cayman Islands;  

 

 b.   Cell Sciences has all requisite corporate power and authority to own, lease, and operate its properties and its business and to enter into and perform its obligations hereunder;  

 

 c. The execution, delivery, and performance of this Agreement by Cell Sciences has been duly authorized by all requisite corporate action on the part of Cell Sciences. This Agreement has been duly executed and delivered by Cell Sciences and constitutes the legal, valid and binding obligation of Cell Sciences, enforceable against Cell Sciences in accordance with its terms, except to the extent that enforceability may be limited by applicable bankruptcy, insolvency,  

or similar laws affecting the enforcement of creditors’ rights generally and subject to general principals of equity;

 

 d.  Cell Sciences agrees to maintain, at its own expense, all legal, governmental and regulatory approvals, licenses and permits necessary to operate legally wherever it is required to do so. 

 

 e.  Cell Sciences’s performance of services will not breach any agreement that Cell Sciences has with another party including, without limitation, any agreement to keep in confidence proprietary information acquired by Cell Sciences in confidence;  

 

 f.  Cell Sciences is not and will not be bound by any agreement, nor has assumed or will assume any obligation, which would in any way be inconsistent with the services to be performed by Cell Sciences under this Agreement; and  

 

 g.  Cell Sciences will perform its duties and obligations in a professional and workmanlike and diligent manner.  

 

 

 11.  DaVinci Representations Regarding Retainer Shares.  DaVinci hereby warrants and represents that: 

 

 a.  DaVinci shall receive the Retainer Shares with no current intention of distributing or reselling the Retainer Shares, the shares of common stock that the Retainer Shares are convertible into, or any part thereof, or interest therein, in any transaction which would be in violation of the securities laws of the United States or any state thereof, without prejudice, however, to the DaVinci’s rights at all times to sell or otherwise dispose of all or any part of the Common Stock, under an effective registration statement under the Securities Act of 1933, as amended (the “Securities Act”), or under an exemption from such registration requirements available under the Securities Act and applicable state securities laws.  

 

 b. DaVinci acknowledges that (i) the Retainer Shares have not been registered under the Securities Act and are being issued to DaVinci by reason of a transaction exempt from the registration and prospectus delivery requirements of the Securities Act pursuant to Section 4(2) thereof, (ii) that DaVinci will have to hold the Retainer Shares and the shares of common stock that the Retainer Shares are convertible into and bear the economic risk of such investment indefinitely, unless a subsequent disposition thereof is registered under the Securities Act or is exempt from such registration and (iii) that Vitro is issuing a significant number of shares of the same kind and class to other persons that are important to the success of the planned operation. 

 

 c.  The certificates representing the Retainer Shares shall bear a restrictive legend in substantially the following form: 

 

"The securities represented by this certificate have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), and may be transferred only pursuant to an effective registration statement under the Securities Act or in 

accordance with an applicable exemption from the registration requirements of the Securities Act."

 

 12.  Indemnification. 

 

 a.  Indemnification by Vitro and Cell Sciences. Vitro and Cell Sciences hereby indemnify, defend, and will hold DaVinci, its Affiliates and their respective employees, agents, officers and directors (the “DaVinci Indemnified Parties”) harmless from and against any and all demands, claims, actions, suits, proceedings, judgments, assessments, costs, expenses, losses, damages, liabilities, fines, and penalties (including, without limitation, reasonable attorneys’ fees) (collectively, “Loss”) alleged against or incurred by the DaVinci Indemnified Parties for property damage or personal injury to the extent caused by Vitro’s use of the Lab. Vitro and Cell Sciences shall indemnify, defend, and hold the “DaVinci Indemnified Parties harmless from and against any and all Third Party Loss alleged against the DaVinci Indemnified Parties by such Third Party as a result of (a) Vitro’s negligence, professional malpractice or willful misconduct; or (b) Vitro’s material breach of this Agreement. 

 

 b.  Indemnification by DaVinci. DaVinci shall indemnify, defend, and hold Vitro and Cell Sciences, their Affiliates and their respective employees, directors, officers and agents (the “Vitro Indemnified Parties”) harmless from and against any and all Third Party Loss alleged against any of the Vitro Indemnified Parties by such Third Party as a result of (i) DaVinci’s negligence, professional malpractice or willful misconduct; or (ii) DaVinci’ material breach of this Agreement.  

 

 c.  Procedure for Claims. Each indemnified Party agrees to give the indemnifying Party prompt written notice of any Loss or discovery of fact upon which such indemnified Party intends to base a request for indemnification under Sections 15(a) or 15(b). Each Party shall furnish promptly to the other copies of all papers and official documents received in respect of any Loss. The indemnifying Party shall have the sole right to defend, settle, or otherwise dispose of such Loss, on such terms as the indemnifying Party, in its sole discretion, shall deem appropriate. The indemnifying Party shall obtain the written consent of the indemnified Party, which shall not be unreasonably withheld or delayed, prior to ceasing to defend, settling or otherwise disposing of any Loss if as a result thereof the indemnified Party would become subject to injunctive or other equitable relief or any remedy other than the payment of money, which payment would be the responsibility of the indemnifying Party. The indemnifying Party shall not be liable for any settlement or other disposition of a Loss by the indemnified Party which is reached without the written consent of the indemnifying Party. The reasonable costs and expenses, including reasonable fees and disbursements of counsel incurred by any indemnified Party in cooperating with the indemnifying Party in its defense of a Loss, shall be reimbursed on a quarterly basis by the indemnifying Party, without prejudice to the indemnifying Party’s right to contest the indemnified Party’s right to indemnification and subject to refund in the event the indemnifying Party is ultimately held not to be obligated to indemnify the indemnified Party.  

 

13.   Arbitration. 

                         (a)  If the parties hereto are unable, after good faith negotiations, which each hereby covenants to undertake, to resolve (except as provided below) any and all disputes in respect to or arising under this Agreement including, without limitation, in respect to the formation of this Agreement, or the construction or interpretation of this Agreement, any party may commence arbitration by sending a written demand for arbitration to the other party or parties, as provided for in Paragraph. Such demand shall set forth with particularity and with  supporting detail or documentation the dispute or matter to be resolved by arbitration. 

 

 (b)  There shall be one arbitrator.  If the parties shall fail to select a mutually acceptable arbitrator  within ten (10) days after the demand for arbitration is mailed, a single arbitrator shall be appointed as soon as possible by the ICC Rules of Arbitration or, failing such appointment, pursuant to the usual procedure of the ICC in such cases.  The fee payable to the arbitrator shall be based upon the then current fee schedule of the ICC and shall be advanced one half by each party, upon the written request of the arbitrator.  

 

                         (c)  The parties shall have the rights of discovery as authorized by the arbitrator. 

 

                         (d)  Except as set forth herein, the arbitrator shall conduct the arbitration according to the ICC Rules. Arbitration shall take place in the Cayman Islands unless the parties otherwise agree.  The arbitrator shall base the decision on the express language of this Agreement.  Within ten (10) days after the arbitrator is appointed, or as soon thereafter as shall be reasonably practicable, a hearing with respect to the dispute or matter to be resolved shall be conducted by the arbitrator.  Each party may make written submissions to the arbitrator, and  each party shall have a reasonable opportunity for rebuttal, but no longer than ten (10) days.  As soon as reasonably practicable, but not later than forty five (45) days (barring exigent circumstances) after the hearing is completed, the arbitrator shall arrive at a final decision, which shall be reduced to writing, signed by the arbitrator and mailed to each of the parties and their legal counsel. 

 

                         (e)  All decisions of the arbitrator shall be  final, binding and conclusive on all parties, and (except as provided below) shall constitute the only method of resolving  disputes or matters subject to arbitration pursuant to this  Agreement.  Judgment may be entered upon such decision in accordance with applicable law in any court having jurisdiction  

thereof. 

 

                         (f)  This arbitration clause and all rulings or decisions of the arbitrator shall be specifically enforceable in  a court of law, or the arbitral tribunal. 

 

  

14. Miscellaneous.  

 

 a.  Assignment. This Agreement shall be binding upon and shall inure to the benefit of the Parties hereto and their respective successors and permitted assigns. This Agreement shall not be assignable by either Party without the prior written consent of the other Party.  

 

 b.  Expenses. Except for payments expressly required to be made by Vitro hereunder, each Party shall bear its own expenses with respect to the transactions contemplated by  

this Agreement, including, without limitation, its attorneys’ fees and other expenses related to the preparation and execution of this Agreement and the completion of this Agreement. 

 

 c.  Severability. Each of the provisions contained in this Agreement shall be severable, and the unenforceability of one shall not affect the enforceability of any others or of the remainder of this Agreement.  

 

 d.  Amendment. This Agreement may not be amended, supplemented or otherwise modified except by an instrument in writing signed by both Parties hereto.  

 

 e.  Waiver. The failure of any Party to enforce any condition or part of this Agreement at any time shall not be construed as a waiver of that condition or part, nor shall it forfeit any rights to future enforcement thereof.  

 

 f.  Governing Law. This Agreement shall be construed and enforced in accordance with and governed by the laws of Grand Cayman, excluding the conflicts of laws and provisions thereof.  

 

 g.  Headings. The headings of the sections and subsections of this Agreement are inserted for convenience only and shall not be deemed to constitute a part hereof.  

 

 h.  Counterpart. The Parties may execute this Agreement in one or more counterparts, and each fully executed counterpart shall be deemed an original.  

 

 i.  Notices. All notices and consents hereunder shall be in writing, effective upon receipt, and shall be delivered personally, mailed by registered or certified mail (return receipt requested, postage prepaid), or sent by express courier service, to the other Party at the following addresses (or at such other address for a Party as shall be specified by like notice):  

 

 To DaVinci: 

 

 To Vitro: 

 

 To Cell Sciences: 

 

 All notices and consents provided for herein shall become effective: (a) on delivery if given in person; or (b) two (2) business days after delivery to the overnight service.  

 

 j.  Entire Agreement. This Agreement constitutes the entire and exclusive agreement between the Parties with respect to the subject matter herein, and supersede all prior and contemporaneous communications and understandings between the Parties, written or oral, relating to this subject matter. This Agreement may only be amended in a writing executed by an authorized representative of each Party.  

 

 k.  Relationship of Parties. The status of the Parties under this Agreement shall be that of independent contractors. Neither Party shall have the right to enter into any agreements on  

behalf of the other Party, nor shall it represent to any person that it has any such right or authority. Nothing in this Agreement shall be construed as establishing a partnership or joint venture relationship between the Parties. Neither Party shall have authority to enter into contracts or binding commitments in the name or on behalf of the other Party. Neither Party will use the other Party’s logo or marks without prior written approval, and then such use shall be only for the benefit of the other Party and at the direction of the other Party. Neither Party shall be, nor represent itself as being, an agent of the other Party, and shall not be, nor represent itself as being, authorized to bind the other Party. Each Party agrees, acknowledges and understands that neither it nor its employees or agents shall have the status of an employee of the other Party and shall not participate in any employee benefit plans or group insurance plans or programs (including, but not limited to salary, bonus or incentive plans, stock option or purchase plans, or plans pertaining to retirement, deferred savings, disability, medical or dental), even if it is considered eligible to participate pursuant to the terms such plans. In addition, each Party understands and agrees that consistent with its independent contractor status, neither it nor its employees or agents will apply for any of the other Party’s government-sponsored benefits intended only for employees, including, but not limited to, unemployment benefits. Such Party’s exclusion from benefit programs maintained by the other Party is a material component of this Agreement. To the extent a Party or its employees or agents may become eligible for any benefit programs maintained by the other Party (regardless of timing or reason for eligibility), such Party hereby waives its right to participate in the programs. Each Party shall defend, indemnify and hold the other Party harmless from any and all claims made by its personnel on account of an alleged failure by the other Party to satisfy any tax or withholding obligations. 

 

 l.  Compliance with Laws. Each Party will comply with all applicable laws, rules, ordinances and regulations of any governmental entity or regulatory agency governing the actions to be taken and provided hereunder. Neither Party will take any action in violation of any applicable law, rule, ordinance or regulation that could result in liability being imposed on the other Party.  

 

 m.  Confidentiality. Each Party agrees that all information observed, communicated or otherwise disclosed to it by the other Party in connection with this Agreement (which information shall at all times be the property of the Party communicating such information) shall constitute “Confidential Information” and be subject to the confidentiality obligations and other provisions of this Agreement.  

 

 

 

 

[SIGNATURES ON FOLLOWING PAGE]

DAVINCI CENTRE FOR WELLNESS AND ALTERNATIVE THERAPIES

 

 

By:  /s/ Lorraine Cona

Lorraine Cona, CEO/Director

 

 

VITRO DIAGNOSTICS, INC.

 

 

By:  /s/ James Musick

James Musick, PhD, President and CEO

 

HALO CELL SCIENCES LTD

 

By:  /s/ James Musick

James Musick, Director

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