Document:

EXHIBIT
10.18

    

    BUSINESS
CONSULTANT AGREEMENT

    
      
        

      
 

    This
Business Consultant Agreement ("Agreement") is made and effective February 18,
2010.

     

    
      	
              BETWEEN:

            	
              Dr. Edward Sauter, MD,
      (the "Consultant"), an individual with his main address located
      at:

            

    

    

    1812 Belmont Road

    Grand Forks, ND 58201

    

    
      	
              AND:

            	
              Atossa Genetics, Inc.
      (the "Company"), a company organized and existing under the laws of
      the State of Delaware, with its head office located
  at:

            

    

    

    4105 E. Madison St., Suite
320

    Seattle,
WA 98112

    

    NOW,
THEREFORE, in consideration of the mutual covenants set forth herein and
intending to be legally bound, the parties hereto agree as follows:

    

    
      	
              A.

            	
              CONSULTATION
      SERVICES

            

    

    

    The
company hereby employs the consultant as a member of the Scientific Advisory
Board to perform the following services in accordance with the terms and
conditions set forth in this agreement: Provide scientific advice to the board
of directors and officers of the Company; recommend additional qualified
individuals to join the SAB, and participate in meetings of the
SAB.

    

    
      	
              B.

            	
              TERMS
      OF AGREEMENT

            

    

    

    This
agreement will begin the effective date of this agreement and will end December
31, 2010. Either party may cancel this agreement on 30 days notice to the other
party in writing, by certified mail or personal delivery.  This
agreement can be extended on an annual basis upon mutual written agreement of
the parties.

    

    
      	
              C.

            	
              TIME
      DEVOTED BY CONSULTANT

            

    

    

    It is
anticipated the consultant will spend approximately four hours per month in
fulfilling its obligations under this contract. The particular amount of time
may vary from month to month. However, the consultant shall devote a minimum of
four hours per month to its duties in accordance with this
agreement.

    

    
      	
              D.

            	
              PLACE
      WHERE SERVICES WILL BE RENDERED

            

    

    

    The
consultant will perform most services in accordance with this contract at a
location of consultant’s discretion. In addition, the consultant will perform
services on the telephone and at such other places as necessary to perform these
services in accordance with this agreement.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      	
              E. 

            	
              COMPENSATION, BENEFITS AND
      EXPENSES

            

    

     

    
      	
              
              

            	
              5.1

            	
              Compensation

            

    

    In
consideration of the services to be rendered hereunder Consultant shall be paid
$5,000.00 upon the signing of this Agreement and $250.00 per hour
thereafter.

    

    
      	
            	
              5.2

            	
              Benefits

            

    

    Other
than the compensation specified in this 5.1, Consultant shall not be entitled to
any direct or indirect compensation for services performed
hereunder.

    

    
      	
            	
              5.3

            	
              Expenses

            

    

    The
Company shall reimburse Consultant for reasonable travel and other business
expenses incurred in the performance of the duties hereunder in accordance with
the Company’s general policies, as they may be amended from time to time during
the course of this Agreement.

    

    
      	
              6

            	
              INDEPENDENT
      CONTRACTOR

            

    

    

    Both the
company and the consultant agree that the consultant will act as an independent
contractor in the performance of its duties under this contract. Accordingly,
the consultant shall be responsible for payment of all taxes including Federal,
State and local taxes arising out of the consultant's activities in accordance
with this contract, including by way of illustration but not limitation, Federal
and State income tax, Social Security tax, Unemployment Insurance taxes, and any
other taxes or business license fee as required.

    

    
      	
              7

            	
              CONFIDENTIAL
      INFORMATION

            

    

    

    The
consultant agrees that any information received by the consultant during any
furtherance of the consultant's obligations in accordance with this contract,
which concerns the personal, financial or other affairs of the company will be
treated by the consultant in full confidence and will not be revealed to any
other persons, firms or organizations.

    

    
      	
              8

            	
              USE
      OF WORK PRODUCT

            

    

    

    Except as
specifically set forth in writing and signed by Company and Consultant,
Consultant shall have all copyright and patent rights with respect to all
materials developed under this contract, and Company is hereby granted a
non-exclusive, royalty-free license, with a right to sublicense, to use and
employ such materials within the Company’s business.

    

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

    

    
      
        
          	
                  COMPANY

                	 
      	
                  CONSULTANT

                
	 
      	 
      	 
      
	
                  /s/ Steven C. Quay, MD.,
PhD

                	 
      	
                  /s/ Edward R. Sauter

                
	
                  Authorized
      Signature

                	 
      	
                  Authorized
      Signature

                
	 
      	 
      	 
      
	
                  Steven C. Quay, MD, PhD

                	 
      	
                  Edward R. Sauter, MD

                
	
                  Print
      Name and Title

                	 
      	
                  Print
      Name and TitleEXHIBIT
10.19

    

    THIS
PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “ACT”), OR UNDER THE SECURITIES LAWS OF APPLICABLE
STATES.  THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON
TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS
PERMITTED UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS, PURSUANT TO
REGISTRATION UNDER SUCH LAWS OR AN EXEMPTION FROM SUCH REGISTRATION
REQUIREMENT.  THE LENDER SHOULD BE AWARE THAT HE MAY BE REQUIRED TO
BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF
TIME.  THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF
COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY
PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE ACT AND ALL APPLICABLE
STATE SECURITIES LAWS.

    

    PROMISSORY
NOTE – LINE OF CREDIT

    
      

    

     

    This
Promissory Note Payable on Demand (the "Note") is made and effective the 3rd of
November, 2010.

    

    
      	
              BETWEEN:

            	
              Steven C. Quay, MD, PhD
      (the "Lender"), an individual with his main address located
      at:

            

    

    

    4105 E Madison St, Suite
320

    Seattle, WA 98112

    

    
      	
              AND:

            	
              Atossa Genetics, Inc.
      (the "Borrower"), a corporation organized and existing under the
      laws of the State of Delaware, with its principal office located
      at:

            

    

    

    Seattle Life Sciences
Building

    1124 Columbia Street, Suite
621

    Seattle, WA 98104

    

    RECITALS

    

    FOR VALUE
RECEIVED, Borrower
promises to pay to the order of Lender, the principal sum of up to $500,000, or
so much thereof as may be disbursed to, or for the benefit of the Borrower by
Lender as set forth below. It is the intent of the Borrower and Lender hereunder
to create a line of credit agreement between Borrower and Lender whereby
Borrower may borrow up to $500,000 hereunder from Lender.  To the
extent that Borrower wishes to draw down a portion of the Note, Borrower shall
provide the Lender with at least 10 days prior written notice (the “Notice
Period”).  At the end of the Notice Period, the Lender shall deliver
to the Borrower the additional principal amount, provided that the aggregate
amounts borrowed hereunder shall not exceed $500,000.

    

    
      	
              1.

            	
              INTEREST
      & PRINCIPAL

            

    

    

    The
unpaid principal of this line of credit shall bear simple interest at the rate
of 10% per annum. Interest shall be calculated based on the principal balance as
may be adjusted from time to time to reflect additional advances made hereunder.
Interest on the unpaid balance of this Note shall accrue monthly but shall not
be due and payable until such time as when the principal balance of this Note
becomes due and payable. The principal balance of this Note shall be due and
payable on December 31, 2011.  There shall be no penalty for early
repayment of all or any part of the principal.

     

    
      	
              2.

            	
              SECURITY

            

    

    

    This Note
shall be unsecured.

     

      
        

      

    

    
      	
              Promissory
      Note Line of Credit

            	
              Page
      1 of 2

            

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	
              3.

            	
              DEFAULT

            

    

    

    The
Borrower shall be in default of this Note on the occurrence of any of the
following events: (i) the Borrower shall fail to meet its obligation to make the
required principal or interest payments hereunder; (ii) the Borrower shall be
dissolved or liquidated; (iii) the Borrower shall make an assignment for the
benefit of creditors or shall be unable to, or shall admit in writing their
inability to pay their debts as they become due; (iv) the Borrower shall
commence any case, proceeding, or other action under any existing or future law
of any jurisdiction relating to bankruptcy, insolvency, reorganization or relief
of debtors, or any such action shall be commenced against the undersigned; (v)
the Borrower shall suffer a receiver to be appointed for it or for any of its
property or shall suffer a garnishment, attachment, levy or
execution.

    

    
      	
              4.

            	
              REMEDIES

            

    

    

    Upon
default of this Note, Lender may declare the entire amount due and owing
hereunder to be immediately due and payable. Lender may also use all remedies in
law and in equity to enforce and collect the amount owed under this Note.
Borrower hereby waives demand, presentment, notice of dishonor, diligence in
collecting, grace and notice of protest.

    

    
      	
              5.

            	
              GOVERNING
      LAW

            

    

     

    This Note
shall be governed by and construed in accordance with the internal laws of the
State of Washington, without reference to principles of conflict of laws or
choice of laws.

     

    IN
WITNESS WHEREOF, the undersigned has caused this Promissory Note to be duly
executed as of the date first written above.

    

    
      	
              LENDER

            	 
      	
              BORROWER

            
	 
      	 
      	 
      
	
              /s/ Steven C. Quay

            	 
      	
              /s/  Steven C.
    Quay

            
	
              Authorized
      Signature

            	 
      	
              Authorized
      Signature

            
	 
      	 
      	 
      
	
              Steven C. Quay, MD, PhD

            	 
      	
              Steven C. Quay, MD, PhD,
  CEO

            
	
              Print
      Name and Title

            	 
      	
              Print
      Name and Title

            

    

     

    
      
        

      

    

    
      	
              Promissory
      Note Line of Credit

            	
              Page
      2 of 2

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