Document:

EXHIBIT 10.6

     NEITHER THE SECURITY EVIDENCED BY THIS WARRANT NOR THE SECURITIES  ISSUABLE
UPON EXERCISE OF THIS WARRANT HAVE BEEN  REGISTERED  UNDER THE SECURITIES ACT OF
1933, AS AMENDED,  OR ANY APPLICABLE  STATE  SECURITIES ACT  (COLLECTIVELY,  THE
"SECURITIES LAWS"). THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT
BE SOLD, OFFERED FOR SALE OR OTHERWISE TRANSFERRED UNLESS THE SECURITIES (I) ARE
REGISTERED UNDER THE SECURITIES LAWS OR (II) ARE EXEMPT FROM REGISTRATION  UNDER
THE  SECURITIES  LAWS  AND  THE  COMPANY  IS  PROVIDED  AN  OPINION  OF  COUNSEL
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.

Warrant No.:   25
Issue Date:   1/1/2002                                   Number of Shares: 15000
Termination Date:   1/1/2012                            (subject to adjustment)

                              HELIX BIOMEDIX, INC.

                          COMMON STOCK PURCHASE WARRANT

     THIS IS TO CERTIFY  that,  for value  received and subject to the terms and
conditions of this Warrant,  Ralph Katz (the "Holder") is entitled,  at any time
prior  to the  Termination  Date as  defined  in  Section  4(c)  (the  "Exercise
Period"),  to subscribe for and purchase upon exercise of this Warrant,  Fifteen
thousand  (15000) shares of the fully paid and  nonassessable  Common Stock, par
value $0.001 per share, of Helix  BioMedix,  Inc., a Delaware  corporation  (the
"Company") (the "Warrant Stock").  The purchase price of the Warrant Stock shall
be $1.50 per share (the "Unit Price").

     This Warrant is subject to the following additional terms and conditions:

     1.   Vesting Warrant Stock. The warrant stock shall vest immediately.
          ---------------------

     2.   Method of Exercise.
          ------------------

     (a) This  Warrant  may be  exercised  in whole or in part,  but not as to a
fractional share of Common Stock,  only during the Exercise Period by delivering
to the Company (i) the form of "Election to Purchase" attached hereto as Exhibit
A, duly  completed  and executed by the Holder,  (ii) this warrant  certificate,
(iii)  payment of the Unit  Price,  in cash or by check,  for each  share  being
purchased,  and (iv) such other  documents  as the Company may  determine  to be
reasonably  necessary  in  connection  with the  issuance of the Warrant  Stock;
provided that the Holder is an "accredited  investor" (as defined in Section 501
of Regulation D promulgated under the Securities Act of 1933, as amended) at the
time of exercise.

<PAGE>

     (b) As an alternative to exercising this Warrant  pursuant to in subsection
(a)  above,  the Holder  may elect to  exercise  this  Warrant  only  during the
Exercise  Period  by  delivering  to the  Company  (i) the  form of  "Notice  of
Conversion"  attached  hereto as Exhibit B, duly  completed  and executed by the
Holder,  (ii) this warrant  certificate,  and (iii) such other  documents as the
Company may determine to be reasonably necessary in connection with the issuance
of the Warrant Stock;  provided that the Holder is an "accredited  investor" (as
defined in Section 501 of Regulation D promulgated  under the  Securities Act of
1933,  as  amended) at the time of  exercise.  Upon  exercise,  pursuant to this
subsection  2(b) (and  without  payment  by the Holder of the Unit  Price),  the
Holder shall be entitled to receive that number of shares of the Common Stock of
the Company equal to the quotient obtained by dividing ((A-B) x C) by A, where:

      A =      the fair  market  value of one share of the  Common
               Stock of the  Company on the date of  exercise of the
               Warrant (as determined by the Board of Directors)

      B =      the per share Unit Price

      C =      the total number of shares of Common Stock of the Company
               subject to purchase upon exercise of this Warrant

If the above  calculation  results in a number less than one,  then no shares of
the Common  Stock of the Company  shall be  issuable or issued  pursuant to this
Subsection (b).

     3. Delivery of Stock Certificates.
     ----------------------------------
     Within  ten (10) days after the  exercise  of this  Warrant  (in full or in
part),  the  Company at its expense  (except  for the payment of any  applicable
transfer  taxes)  shall  issue in the name of and  deliver  to the  Holder (a) a
certificate  or  certificates  for the  number of fully  paid and  nonassessable
shares  of  Warrant  Stock to which  the  Holder  shall be  entitled  upon  such
exercise,  and (b) unless this Warrant has expired,  a new Warrant  representing
the number of shares (except a remaining  fractional share) of Warrant Stock, if
any,  with  respect to which this  Warrant  shall not have been  exercised.  The
Holder  shall for all  purposes be deemed to have become the holder of record of
such shares of Warrant  Stock on the date on which this  Warrant is  surrendered
and payment on the Warrant Price is made,  irrespective  of the date of delivery
of the certificate or  certificates  representing  the Warrant Stock;  provided,
that if the date of such surrender and payment is a date when the stock transfer
books of the Company are closed,  such person shall be deemed to have become the
holder of record of such shares of Warrant Stock at the close of business on the
next succeeding date on which the stock transfer books are open.

<PAGE>

     4. Covenants as to Warrant Stock.
     ---------------------------------
     The Company  covenants  and agrees that all shares of Warrant  Stock issued
pursuant to the terms of this  Warrant  will,  upon their  issuance,  be validly
issued  and  outstanding,  fully paid and  nonassessable.  The  Company  further
covenants  and agrees that the  Company  will at all times have  authorized  and
reserved  a  sufficient  number of shares of  Common  Stock to  provide  for the
exercise of the rights represented by this Warrant.

     5. Termination.
     ---------------
     Upon a merger,  consolidation,  acquisition of all or substantially  all of
the  property  or  stock,   reorganization   or   liquidation   of  the  Company
(collectively, a "Reorganization"), as a result of which the stockholders of the
Company  receive cash,  stock or other  property in exchange for their shares of
Common  Stock,  this  Warrant  shall be  automatically  converted as provided in
Section 1(b) immediately prior to the Reorganization;  provided,  however,  that
the Company shall have delivered to the Holder notice of the  Reorganization  no
less  than  ten  (10)   business   days  before  the  date   scheduled  for  the
Reorganization and that the Holder shall have the right immediately prior to the
Reorganization  to exercise this Warrant as provided in Section 3(a) or to elect
in writing that this Warrant not be automatically  converted as provided in this
Section 5(a).  Unless the Holder  exercises  this Warrant as provided in Section
1(a) or elects in writing  that this Warrant not be  automatically  converted as
provided in this Section 6(a), this Warrant shall be automatically  converted as
provided in Section 3(b) immediately prior to the Reorganization.  To the extent
Holder  elects in writing that this Warrant not be  automatically  converted and
otherwise  does not exercise  this  Warrant  prior to the  Reorganization,  this
Warrant shall be canceled and all rights under this Warrant shall terminate upon
the Reorganization. If not sooner canceled pursuant to the provisions of Section
5(a),  this Warrant  shall be canceled and the rights  granted  hereunder  shall
terminate  at the  close  of  business  on  September  30,  2011.  The  date  of
termination  of this  Warrant as  provided  in  Sections  5(a) and 5(b) shall be
referred to herein as the "Termination Date."

     6. Adjustments Affecting Common Stock.
     --------------------------------------

          (a) Reclassification.
          ---------------------
          In the case of any  reclassification  or  change of the  Common  Stock
     issuable  upon  exercise of this  Warrant,  the Company shall execute a new
     Warrant,  providing that the Holder of this Warrant shall have the right to
     exercise such new Warrant,  in substantially the form hereof, and upon such
     exercise  to  receive,  in lieu of each share of Common  Stock  theretofore
     issuable upon  exercise of this  Warrant,  the number and kind of shares of
     stock,   other   securities,   money  or  property   receivable  upon  such
     reclassification  or change by a holder of shares of Common Stock. Such new
     Warrant shall provide for adjustments  which shall be as nearly  equivalent
     as may be  practicable to the  adjustments  provided for in this Section 6.
     (b) Exercise Price. If any of the following  events shall occur at any time
     or from time to time prior to the  exercise in full of this  Warrant or the
     Termination  Date,  the  following  adjustments  shall  be made to the Unit
     Price:

               (1) Split, Subdivision or Combination of Shares.
               ------------------------------------------------
               If the Company at any time while this Warrant remains outstanding
          and  unexpired  shall  split,  subdivide  or combine its Common  Stock
          issuable  upon  exercise  of this  Warrant,  the Unit  Price  shall be
          proportionately  decreased  in the case of a split or  subdivision  or
          increased  in the  case of a  combination.

<PAGE>

               (2) Stock Dividends and Distributions.
               --------------------------------------
               If the Company at any time while this Warrant is outstanding  and
          unexpired shall pay a stock dividend or other stock  distribution with
          respect to the Common  Stock  (except  any  distribution  specifically
          provided  for in Section 6(a) or 6(b)(1)  above),  then the Unit Price
          shall be  adjusted,  from and after the date of  determination  of the
          stockholders  entitled to receive such  dividend or  distribution,  to
          that  price  determined  by  multiplying  the  Unit  Price  in  effect
          immediately  prior to such date of determination by a fraction (i) the
          numerator  of which shall be the total  number of shares of the Common
          Stock outstanding  immediately prior to such dividend or distribution,
          and (ii) the  denominator of which shall be the total number of shares
          of the Common Stock  outstanding  immediately  after such  dividend or
          distribution.

          (d) Adjustment to Number of Shares.
          -----------------------------------
          After any  adjustment of the Unit Price  pursuant to Section 6(b), the
     number of shares of Warrant  Stock  issuable at the new Unit Price shall be
     adjusted to the number  obtained by (i) multiplying the number of shares of
     Warrant Stock  issuable upon  exercise of this Warrant  immediately  before
     such  adjustment  by the  Unit  Price in  effect  immediately  before  such
     adjustment and (ii) dividing the product so obtained by the new Unit Price.

     7. Fractional Shares.
     ---------------------
     No fractional shares shall be issued upon the exercise of this Warrant.  In
lieu of fractional  shares, the Company shall pay the Holder a sum in cash equal
to the  fair  market  value  of the  fractional  shares  (as  determined  by the
Company's Board of Directors) on the date of exercise.

     8. Restrictions on Transfer.
     ----------------------------
     This Warrant or any securities  purchased upon exercise of this Warrant may
not be  transferred  with the prior  written  consent of the Company,  which the
Company may not  unreasonably  withhold or condition.  The Company may condition
its consent upon any reasonable restriction,  including, but not limited to: (a)
that such transfer is registered  under the  Securities  Act of 1933, as amended
(the  "Securities  Act"),  and any applicable state securities or blue sky laws,
(b) that the Company has received a legal opinion reasonably satisfactory to the
Company to the effect that the transfer is exempt from the  prospectus  delivery
and  registration  requirements  of the Securities Act and any applicable  state
securities or blue sky laws,  (c) that the Company  otherwise  satisfies  itself
that such transfer is exempt from registration,  and (d) that the Holder pay the
costs and expenses necessary to comply with applicable securities and other laws
relating to such transfer.

     9. Market Standoff Agreement.
     -----------------------------
     In connection with any public offering of the Company's securities and upon
request  of the  Company  or the  underwriters  managing  such  offering  of the
Company's  securities,  Purchaser  agrees  not to sell,  make any short sale of,
loan,  grant any  option  for the  purchase  of,  or  otherwise  dispose  of any
securities  of the  Company  (other  than those  included  in the  registration)
without the prior written  consent of the Company or such  underwriters,  as the
case may be,  for such  period of time (not to exceed 180 days in the case of an
initial public  offering and not to exceed 90 days in any  subsequent  offering)
from the effective date of such  registration as may be requested by the Company
or such  managing  underwriters  and to  execute  an  agreement  reflecting  the
foregoing as may be requested by the  underwriters  at the time of such a public
offering.

<PAGE>

     10. Legend.
     -----------
     A legend  setting  forth or  referring to the above  restrictions  shall be
placed on this Warrant, any replacement hereof and any certificate  representing
a security  issued  pursuant to the exercise of this Warrant and a stop transfer
restriction  or order may be placed  on the  books of the  Company  and with any
transfer  agent  until  such   securities  may  be  legally  sold  or  otherwise
transferred.

     11. Holder as Owner.
     --------------------
     The Company may deem and treat the holder of record of this  Warrant as the
absolute owner hereof for all purposes regardless of any notice to the contrary.

     12. No Rights as Stockholder.
     -----------------------------
     This  Warrant  shall not entitle the Holder to any voting  rights or to any
other rights as a stockholder  of the Company or to any other rights  whatsoever
except the rights stated  herein;  no cash dividend or interest shall be payable
or shall  accrue in respect of this  Warrant or the  Warrant  Stock  purchasable
hereunder unless, until and to the extent that this Warrant shall be exercised.

     13. Construction.
     -----------------
     The  laws  of the  State  of  Washington  shall  govern  the  validity  and
interpretation  of the terms and  provisions  of this Warrant.  The  descriptive
headings of the several  sections of this Warrant are  inserted for  convenience
only and shall not control or affect the meaning or  construction  of any of the
provisions thereof.

     14. Expiration.
     ---------------
     This Warrant  shall be void and all rights  represented  hereby shall cease
unless  exercised on or before the Termination  Date. All restrictions set forth
herein on the  shares of  capital  stock  issued  upon  exercise  of any  rights
hereunder  shall  survive such  exercise and  expiration  of the rights  granted
hereunder.

     15. Lost Warrant Certificate.
     -----------------------------
     If this Warrant is lost, stolen,  mutilated or destroyed, the Company shall
issue a new  Warrant  of like  denomination,  tenor  and  date as this  Warrant,
subject to the Company's  right to require the Holder to give the Company a bond
or other satisfactory  security  sufficient to indemnify the Company against any
claim that may be made  against it  (including  any  expense  or  liability)  on
account of the alleged loss, theft, mutilation or destruction of this Warrant or
the issuance of such new Warrant.

     16. Waivers and Amendments.
     ---------------------------
     This Warrant or any provision hereof may be changed, waived,  discharged or
terminated  only by a statement  in writing  signed by the party  against  which
enforcement of the change, waiver, discharge or termination is sought.

     17. Notices.
     ------------
     All notices or other  communications  required or permitted hereunder shall
be in writing and shall be deemed effectively delivered and given on the earlier
of (a)  personal  delivery  or (b) three days after  mailing  by  registered  or
certified mail with return receipt requested, addressed as follows:

<PAGE>

                  If to the Holder:

                           Ralph Katz
                           440 S. LaSalle Drive, Suite 1615
                           Chicago, IL 60605

                  If to the Company:

                           Helix BioMedix, Inc.
                           22122 20th Avenue SE, Suite #148
                           Bothell, WA 98021

     Each of the  foregoing  parties  shall be  entitled  to specify a different
address by giving five (5) days'  advance  written  notice as  aforesaid  to the
other party.

     18. Investment Intent.
     ----------------------
     By accepting this Warrant,  the Holder represents that he is acquiring this
Warrant for investment  and not with a view to, or for sale in connection  with,
any distribution thereof.

     IN WITNESS  WHEREOF,  the Company has executed this  certificate  as of the
date first written above.

                                   HELIX BIOMEDIX, INC.

                                   By:  /s/ R. Stephen Beatty
                                        ------------------------------------
                                        R. Stephen Beatty, President and CEO

<PAGE>

                                    EXHIBIT A

                              ELECTION TO PURCHASE
                              --------------------

To:   HELIX BIOMEDIX, INC.

     The undersigned registered owner of this Warrant irrevocably exercises this
Warrant for _______________  shares of Common Stock of Helix BioMedix,  Inc., on
the  terms  and  conditions  specified  in this  Warrant,  and  requests  that a
certificate  for the  shares  hereby  purchased  (and  any  securities  or other
property  issuable upon such exercise) be issued in the name of and delivered to
_________________________,              whose             address             is
____________________________________________  and,  if  such  shares  shall  not
include all of the shares  into which this  Warrant is  exercisable,  that a new
Warrant of like tenor and date for the balance of the shares issuable  hereunder
be delivered to the undersigned.

     The  undersigned  represents  (i) that the  undersigned  is an  "accredited
investor"  (as  defined in Section 501 of  Regulation  D  promulgated  under the
Securities Act of 1933, as amended) as of the date of this Election to Purchase,
(ii)  that the  aforesaid  shares of Common  Stock  are being  acquired  for the
account of the  undersigned for investment and not with a view to, or for resale
in connection with, the distribution thereof, and (iii) that the undersigned has
no present intention of distributing or reselling such shares.

Dated:
       ---------------------

                                     ------------------------------------
                                     Signature of Registered Owner

                                     ------------------------------------
                                     (Street Address)

                                     ------------------------------------
                                     (City)         (State)     (Zip Code)

                                     ------------------------------------
                                     (Social Security Number or Tax I.D. Number)

<PAGE>

                                    EXHIBIT B

                              NOTICE OF CONVERSION
                              --------------------

To:  HELIX BIOMEDIX, INC.

     (1) The  undersigned  hereby  elects to convert the  attached  Common Stock
Purchase  Warrant (the  "Warrant") into such number of shares of Common Stock of
Helix BioMedix,  Inc. as is determined  pursuant to Section 1(b) of the Warrant,
which conversion shall be effected pursuant to the terms of the Warrant.

     (2) Please issue a certificate or certificates  representing said shares of
Common Stock in the name of the undersigned.

     (3) The  undersigned  represents (i) that the undersigned is an "accredited
investor"  (as  defined in Section 501 of  Regulation  D  promulgated  under the
Securities Act of 1933, as amended) as of the date of this Notice of Conversion,
(ii)  that the  aforesaid  shares of Common  Stock  are being  acquired  for the
account of the  undersigned for investment and not with a view to, or for resale
in connection with, the distribution thereof, and (iii) that the undersigned has
no present intention of distributing or reselling such shares.EXHIBIT 10.13

           Second Amended Consulting Agreement - Dunsford Hill Capital

                SECOND AMENDED AND RESTATED CONSULTING AGREEMENT

                      DUNSFORD HILL CAPITAL PARTNERS, INC.

                         This SECOND AMENDED AND RESTATED  CONSULTING  AGREEMENT
                    (this "Agreement"),  dated as of August 15, 2002, is entered
                    into  by  and  among  HELIX   BIOMEDIX,   INC.,  a  Delaware
                    corporation  ("Helix"),  and DUNSFORD HILL CAPITAL PARTNERS,
                    INC., a California corporation ("Consultant").

                              PRELIMINARY RECITALS

     WHEREAS,  Helix and  Consultant  entered  into a  Consulting  Agreement  on
October 27, 2000 and an Amended and  Restated  Consulting  Agreement  on May 30,
2001 (the "Prior Agreements"), containing provisions relating to the services to
be provided to Helix by Consultant and the  compensation  to be paid by Helix to
Consultant; and

     WHEREAS,  Helix  and  Consultant  desire  to amend  and  restate  the terms
governing the relationship between the parties; and

     WHEREAS,  Helix is a publicly owned biotechnology  company which is engaged
in (i) developing,  testing,  patenting,  and manufacturing  synthetic bioactive
peptides (small proteins) having  applications in the  pharmaceutical and health
care  fields  and (ii)  licensing  its  proprietary  technology  and in  seeking
strategic corporate alliances for further development and  commercialization  of
its technology (collectively, the "Business"); and

     WHEREAS, Helix desires outside professional  assistance in various areas of
strategic and financial planning and believes that Consultant has experience and
expertise that will be valuable to Helix; and

     WHEREAS, Helix desires to engage Consultant as a consultant, and Consultant
desires to perform consulting services for Helix, under the terms and conditions
set forth herein; and

     WHEREAS,  Helix anticipates  receipt of $1M from an equity bridge financing
on or about September, 2002 ("Bridge Financing"); and

     WHEREAS,  Helix  anticipates  receipt of an additional $1.5M from an equity
financing  occurring  after receipt of the Bridge  Financing  funds and prior to
December 31, 2002 ("Next Round of Financing");

         NOW, THEREFORE,  in consideration of the premises, the mutual covenants
of the parties hereinafter set forth and other good and valuable  consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:

                                       -1-
<PAGE>

     1. Novation.
     ------------
     Except as provided in sections  2.5(a) and 16 below,  the Prior  Agreements
are hereby extinguished and replaced in their entirety by this Agreement.

     2. Consulting.
     --------------

          2.1 Consulting Services.
          ------------------------
          Helix hereby engages  Consultant,  and Consultant  hereby accepts such
     engagement  and  agrees  to serve as  consultant  to Helix  concerning  the
     Business  for a period  of one  year,  beginning  on the date  hereof  (the
     "Consulting  Period").  In connection  with the  performance of its duties,
     Consultant  shall  cause  Consultant's  duties  hereunder  to be  performed
     primarily by Randall L.-W. Caudill (the "Consulting Principal").

          2.2 Duties.
          -----------
          Consultant shall faithfully and to the best of its ability perform the
     duties  assigned by the Board of  Directors  of Helix and shall serve under
     the direction of the President and Chief Executive Officer of Helix.  These
     duties shall include, without limitation, the following duties:

          (a)  strategic planning,

          (b)  assisting Helix in developing and monitoring business and science
               plans,

          (c)  assisting Helix in seeking additional financing,

          (d)  assisting Helix with efforts to enhance shareholder value, and

          (e)  reporting on a quarterly basis  Consultant's  progress in respect
               of duties assigned by Board, in a format reasonably  requested by
               the Chief Executive Officer of Helix.

          2.3 Relationship of Parties.
          ----------------------------
          Consultant  shall  be  deemed  an  independent  contractor  and not an
     employee of Helix. All letterhead, business cards and promotional materials
     used or  distributed by Consultant  shall present  Consultant as a business
     consultant to, and not an employee or principal of, Helix. Consultant shall
     be responsible for all taxes associated with payment  hereunder,  including
     but not limited to income taxes and social security taxes.

               2.4 Expenses.
               -------------
          All  ordinary  and  reasonable   out-of-pocket  expenses  incurred  by
     Consultant  solely as a result of the performance of Consultant's  services
     as  assigned  pursuant to Section 2.2 above,  including  reasonable  travel
     expenses,  shall be  reimbursed  to  Consultant  by  Helix,  provided  that
     Consultant   shall  have   submitted   an  invoice   together   with  other
     documentation of such expenses as Helix may reasonably require.

                                       -2-
<PAGE>

          2.5 Compensation.
          -----------------

               (a)  Consultant's  current  entitlement to options or warrants to
          acquire  Helix stock at $1.50 per share,  not  including any potential
          entitlement  contingent  upon  triggering  events,  shall survive this
          Novation  and vest in  accordance  with the  provisions  of the  Prior
          Agreements.

               (b)  As  consideration   for  the  services  to  be  rendered  by
          Consultant hereunder,  its agreement not to compete with Helix and its
          agreement  to  promote  services  for and  through  Helix  during  the
          Consulting  Period,   Helix  hereby  grants  to  Consultant   warrants
          ("Warrants")  to purchase an aggregate of 50,000 shares of the Helix's
          common  stock at an exercise  price per share of the lower of $1.50 or
          the price of the Next Equity Financing. Warrants shall have a ten-year
          term,  commencing  on August 15,  2002 and ending on August 15,  2012,
          when any and all unexercised  Warrants granted herein shall expire and
          terminate.

               c) In  addition  to the  compensation  to be paid in the  form of
          warrants as  referenced  in paragraph  2.5(b)  above,  upon receipt by
          Helix of Bridge  Financing  funds of $1M, Helix shall pay Consultant a
          one-time lump sum payment of $18,000 and  thereafter  $1,500 per month
          for the next  twelve  (12)  months  beginning  on the first day of the
          month following receipt of such funds.

               (d) In  addition  to the  compensation  to be  paid  pursuant  to
          paragraph  2.5(b)  and (c)  above,  upon  receipt by Helix of funds of
          $1.5M  or more  from  the  Next  Equity  Financing,  Helix  shall  pay
          Consultant  an  additional  one-time  lump sum  payment of $18,000 and
          thereafter  an  additional  $1,500 per month for the next  twelve (12)
          months  beginning on the first day of the month  following  receipt of
          such funds.

               (e) In the  event of any  change  in the  outstanding  shares  of
          common   stock  by   reason   of  any   stock   dividend   or   split,
          recapitalization,  merger,  consolidation,  combination or exchange of
          shares or other similar corporate change, the maximum aggregate number
          and  class of  shares  of  common  stock  which  may be  purchased  by
          Consultant  pursuant to the Warrants  will be  equitably  adjusted for
          such event.

               2.6 Restricted Stock
               --------------------

                  (a)  Consultant  recognizes and  understands  that neither the
         Warrants  nor the shares of Common  Stock of Helix to be  purchased  by
         Consultant  pursuant to the Warrants  (collectively,  the "Securities")
         will be registered under the Securities Act of 1933 ("Securities Act"),
         or under the securities laws of any state (the "securities laws").

                                       -3-
<PAGE>

                  (b) Consultant represents and warrants that (i) the Consulting
         Principal has knowledge and experience in business, finance, securities
         and investments,  such experience  being based on actual  participation
         therein,  (ii) the  Consulting  Principal is capable of evaluating  the
         merits and risks of an investment in the Securities and the suitability
         thereof as an investment therefor, (iii) the Consulting Principal is an
         experienced  and  sophisticated  investor  in  investments,   including
         investments  similar to that of the  Securities,  (iv) Securities to be
         acquired by it will be acquired  solely for  investment  and not with a
         view toward  resale or  redistribution  in violation of the  securities
         laws, and no assurances have been made concerning the future results of
         Helix or as to the value of the Securities,  (v) it (and the Consulting
         Principal) is an "accredited investor" within the meaning of Regulation
         D promulgated by the United States  Securities and Exchange  Commission
         (the  "Commission")  pursuant  to the  Securities  Act,  and  (vi)  the
         Consulting Principal is the sole shareholder of Consultant.

                  (c) Consultant has consulted with its own counsel in regard to
         the securities laws and is fully aware (i) of the  circumstances  under
         which it is required to hold the Securities, (ii) of the limitations on
         the  transfer  or  disposition  of the  Securities,  and (iii) that the
         securities  must be held  indefinitely  unless the transfer  thereof is
         registered under the securities laws or an exemption from  registration
         is available.

                  (d)  Consultant   and  the  Consulting   Principal  have  been
         furnished  with a copy of the  Annual  Report  on Form  10-KSB of Helix
         filed with the Commission under the Securities Exchange Act of 1934, as
         amended,  for the fiscal year ended  December 31, 2001.  Helix has made
         available to Consultant  the  opportunity  to ask questions and receive
         answers  concerning  the  terms  and  conditions  of  the  transactions
         contemplated by this Agreement and to obtain any additional information
         which they possess or could reasonably acquire the purpose of verifying
         the accuracy of the  information  furnished to  Consultant as set forth
         herein or for the purpose of considering the transactions  contemplated
         hereby.  Helix has  offered  to,  and  agrees  during  the term of this
         Agreement,  make  available to Consultant  upon request at any time all
         exhibits  filed by  Helix  with  the  Commission  as part of any of the
         reports filed therewith.

          2.7 Company Information.
          ------------------------
          In  connection  with  Consultant's  engagement,   Helix  will  furnish
     Consultant and/or the Consulting Principal with all information  concerning
     Helix which  Consultant  and/or the Consulting  Principal shall  reasonably
     request. Helix represents and warrants that all such information concerning
     Helix  will be true and  accurate  in all  material  respects  and will not
     contain any untrue statement of a material fact or omit to state a material
     fact necessary in order to make statements  therein not misleading in light
     of  the   circumstances   under  which  such  statements  are  made.  Helix
     acknowledges  and agrees that Consultant and the Consulting  Principal will
     be using  and  relying  upon  such  information  supplied  by Helix and its
     officers,   agents  and  others   concerning   Helix  without   independent
     investigation   or  verification   thereof  or  independent   appraisal  by
     Consultant or the Consulting Principal.

                                      -4-
<PAGE>

          2.8 Restrictive Covenant.
          -------------------------
          Except as  otherwise  consented  to in writing by Helix,  such consent
     being not unreasonably withheld,  during the term of this Agreement and for
     a period of two years  thereafter,  neither  Consultant  nor the Consulting
     Principal  shall either as an individual on his own account;  as a partner,
     joint venturer,  consultant, agent, salesman for any person; as an officer,
     director or stockholder (other than a beneficial holder of not more than 5%
     of the outstanding voting stock of a company having at least 250 holders of
     voting stock) of a corporation; or otherwise, directly or indirectly:

               (a) enter  into or engage in any  business  or  consult  with any
          business or entity  directly  competitive  with Helix  anywhere in the
          world;

               (b)  solicit or attempt to solicit  any of Helix  customers  with
          whom  Consultant  has had contact as a Consultant or employee of Helix
          with the intent or purpose to perform  for such  customer  the same or
          similar services which  Consultant  performed for such customer during
          the term of his service hereunder or employment by Helix;

               (c)  employ or  solicit,  or attempt  to employ or  solicit,  for
          himself  or  any  third  party,  the  employment  of  any  of  Helix's
          employees; or

               (d) induce or attempt to induce any employee, consultant or agent
          of Helix to discontinue services to Helix.

     Notwithstanding  the above, Helix acknowledges and agrees that Consultant's
and   Consulting    Principal's    existing    relationships    with   Northwest
Biotherapeutics, Inc., VaxGen, Inc., and MediQuest Therapeutics, Inc. are not in
violation of this Section 2.8. The  provisions of this Section 2.8 shall survive
the termination of this Agreement.

     3. Assignment.
     --------------
     No party  hereto may assign or  delegate  any of its rights or  obligations
hereunder without the prior written consent of the other party hereto. Except as
otherwise  expressly provided herein, all covenants and agreements  contained in
this Agreement by or on behalf of any of the parties hereto shall be binding and
inure to the benefit of the respective legal representatives,  heirs, successors
affiliates and assigns of the parties hereto, whether so expressed or not.

     4. Severability.
     ----------------
     If any  provision  of this  Agreement is held to be  unenforceable  for any
reason,  it shall be  adjusted  rather than  voided,  if  possible,  in order to
achieve  the intent of the  parties to the extent  possible.  In any event,  all
other  provisions of this Agreement shall be deemed valid and enforceable to the
full extent.

     5. Counterparts.
     ----------------
     This  Agreement  may be executed in  multiple  counterparts,  each of which
shall be deemed an original,  but all of which taken together  shall  constitute
one and the same Agreement.

     6. Descriptive Headings: Interpretation.
     ----------------------------------------
     The descriptive  headings in this Agreement are inserted for convenience of
reference  only and are not  intended  to be part of or to affect the meaning or
interpretation  of this  Agreement.  The  use of the  word  "including"  in this
Agreement shall be by way of example rather than by limitation.

                                       -5-
<PAGE>

     7. Notices.
     -----------
     All notices, demands or other communications to be given or delivered under
or by reason of the provisions of this  Agreement  shall be in writing and shall
be deemed to have been duly given if (i) delivered  personally to the recipient,
(ii)  sent to the  recipient  by  reputable  express  courier  service  (charges
prepaid) or mailed to the  recipient  by certified or  registered  mail,  return
receipt and postage prepaid,  or (iii)  transmitted by telecopy to the recipient
with a  confirmation  copy to follow the next day to be  delivered  by overnight
carrier.  Such  notices,  demands and other  communication  shall be sent to the
addresses indicated below:

                  (a) If to Consultant:

                           Dunsford Hill Capital Partners, Inc.
                           1080 Chestnut Street, Apt. 16-A
                           San Francisco, California  94109
                           Attn:  Mr. Randall L.-W. Caudill

                  (b) If to Helix:

                           Helix Biomedix, Inc.
                           22122 20th Ave. SE
                           Bothell, WA  98021
                           Attn:  Chief Executive Officer

or to such  other  address  or to the  attention  of such  other  person  as the
recipient party has specified by prior written notice to the sending party.  The
effective  date of such notice  shall be (w) the date such notice is  personally
delivered,  (x) three days after the date of  mailing  if sent by  certified  or
registered mail, (y) one day after date of delivery to the overnight  courier if
sent by  overnight  courier  or (z) the  next  business  day  after  the date of
transmission by telecopy or e-mail.

     8. Confidential Information and Discoveries.
     --------------------------------------------
     Consultant and the  Consulting  Principal  agree that all  information of a
technical or business  nature such as know-how,  trade secrets,  secret business
information,   plans,  data,   processes,   techniques,   customer  information,
inventions,  discoveries,  formulae,  patterns,  devices,  etc.,  ("Confidential
Information")  pertaining  to the  business  of Helix,  is a  valuable  business
property right of Helix.  Consultant and the  Consulting  Principals  agree that
such Confidential  Information,  whether in written, verbal or model form, shall
not be disclosed to anyone  outside the employment of Helix or otherwise used by
Consultant or the Consulting Principal for any purpose other than fulfillment of
their  respective   obligations  under  this  Agreement,   without  the  express
authorization of Helix.  Confidential  Information does not include  information
which  Consultant or the  Consulting  Principal can  demonstrate  (i) has become
generally  available  to the public  other than as a result of a  disclosure  by
Consultant or the Consulting Principal,  (ii) has become available to Consultant
or the Consulting Principal on a non-confidential basis from a source other than
Helix,  provided such source is not bound by a  confidentiality  agreement  with
Helix or otherwise prohibited from transmitting the information to Consultant or
the Consulting Principal by a contractual, legal or fiduciary obligation.

                                       -6-
<PAGE>

     Any and all improvements, inventions, discoveries, formulae or processes in
any way related to Helix's business which Consultant or the Consulting Principal
may conceive or make during his regular  working hours or otherwise shall be the
sole and exclusive property of Helix and Consultant and the Consulting Principal
will disclose the same to Helix and will,  whenever  requested by Helix to do so
(either  during the terms of this Agreement or  thereafter),  execute and assign
any and all applications, assignments and/or other instruments and do all things
which Helix may deem  necessary or  appropriate  in order to apply for,  obtain,
maintain, enforce and defend patents,  copyrights,  trademarks or other forms of
protection,  or in order to assign and convey or  otherwise  make  available  to
Helix  the  sole  and  exclusive  right,  title  and  interest  in and  to  said
improvements,  inventions,  discoveries,  formulae,  processes,  applications or
patents.

     No provision in this Agreement is intended to require  assignment of any of
the rights of  Consultant  or the  Consulting  Principal  in an  invention if no
equipment,  supplies, facilities, or trade secret information of Helix was used,
and the  invention  was  developed  entirely on the  Consultant's  or Consulting
Principal's own time; and the invention does not relate to the business of Helix
or to Helix's actual or demonstrably  anticipated  research or development;  and
does not result from any work  performed  by the  Consultant  or the  Consulting
Principal for Helix.

     The  provisions  of this Section 8 shall  survive the  termination  of this
Agreement.

     9. Return of Documents.
     -----------------------
     Upon the  termination  of this Agreement for any reason,  Consultant  shall
forthwith  return and  deliver to Helix and shall not  retain  any  original  or
copies of any books, papers, price lists or customer contracts, bids or customer
lists,  files,  books of account,  notebooks  and other  documents  and data (in
printed,  audio, video, electronic or other form) relating to the performance of
services  rendered by Consultant  hereunder,  all of which  materials are hereby
agreed to be the property of Helix.

     10. Preliminary Recitals.
     -------------------------
     The  Preliminary  Recitals  set forth in the  preamble  hereto  are  hereby
incorporated and made part of this Agreement.

     11. Entire Agreement.
     ---------------------
     Except as otherwise  expressly set forth herein,  this Agreement sets forth
the entire  understanding of the parties,  and supersedes and preempts all prior
oral or written understandings and agreements with respect to the subject matter
hereof.

     12. Governing Law.
     ------------------
     This Agreement shall be construed and enforced in accordance  with, and all
questions concerning the construction,  validity, interpretation and performance
of this Agreement shall be governed by, the laws of the State of California.

     13. Representations and Warranties.

                                       -7-
<PAGE>

               13.1  Helix   represents  and  warrants  that:  (i)  Helix  is  a
          corporation,  duly  organized,  validly  existing and in good standing
          under  the laws of the  State of  Delaware,  has duly  authorized  the
          execution and  performance of this  Agreement,  and such execution and
          performance will not violate its Articles of Incorporation, Bylaws, or
          any  contract  or  agreement  by which  it is  bound;  and  (ii)  this
          Agreement is valid and  enforceable  against Helix in accordance  with
          its terms,  and each  instrument  to be executed by Helix  pursuant to
          this Agreement  will,  when executed and delivered,  be enforceable in
          accordance  with its terms,  subject  to  bankruptcy,  insolvency  and
          similar laws affecting  creditors' rights  generally.  13.2 Consultant
          represents and warrants  that:  (i)  Consultant is a corporation  duly
          organized, validly existing and in good standing under the laws of the
          State of California, has duly authorized the execution and performance
          of this Agreement, and such execution and performance will not violate
          its Articles of Incorporation,  bylaws or any contract or agreement by
          which it is bound;  and (ii) this  Agreement is valid and  enforceable
          against Consultant and the Consulting Principal in accordance with its
          terms,  and each  instrument  to be  executed  by  Consultant  and the
          Consulting  Principal  pursuant to this Agreement  will, when executed
          and delivered, be enforceable in accordance with its terms, subject to
          bankruptcy,  insolvency and similar laws affecting  creditors'  rights
          generally.

     14. Compliance with Laws.
     -------------------------
     Consultant   shall  comply  with  all  federal,   state,  and  local  laws,
regulations,  ordinances,  orders, decrees,  resolutions,  and other acts of any
governmental  entity,  including,  but  not  limited  to,  securities  laws  and
regulations  that are  applicable  to this  Agreement  and the work and services
performed or provided hereunder.

     15. Attorney's Fees.
     --------------------
     If a dispute  arises  relating to the  performance  of the  obligations  of
either  Consultant (or the Consulting  Principal) or Helix pursuant to the terms
of this Agreement and legal or other costs are incurred,  the  prevailing  party
shall be  entitled to recover all  reasonable  costs  incurred in the defense or
prosecution of the claim, including court costs, reasonable attorney's fees, and
other claim-related expenses.

     16. Indemnification.
     --------------------
     Helix shall (A) indemnify  Consultant  and  Consulting  Principal  (jointly
and/or  severally,  the  "Indemnified  Parties"),  and hold them harmless to the
fullest  extent  permitted  by  law  against  any  losses,  claims,  damages  or
liabilities  to which the  Indemnified  Parties may become subject in connection
with (i) their use of information that is inaccurate in any respect (as a result
of  misrepresentation,  omission,  failure  to  update,  or  otherwise)  that is
provided  to  Indemnified  Parties  by  Helix,  its  representatives,  agents or
advisers,  regardless  of whether the  Indemnified  Parties  knew or should have
known of such  inaccuracy,  or (ii) any other aspect of rendering such services,
in the  case  of  each of  clauses  (i) and  (ii)  above  unless  it is  finally
judicially determined that such losses,  claims, damages or liabilities relating
thereto arise only out of the gross  negligence or willful  misconduct of any of
the Indemnified Parties, and (B) reimburse  Indemnified Parties for any legal or
other expenses  reasonably  incurred by them in connection  with  investigating,
preparing to defend or defending  any  lawsuits,  claims,  or other  proceedings
arising in any manner out of or in connection  with their  performance  of their
duties  pursuant to the  engagement  contemplated  herein,  unless it is finally
judicially determined that the losses,  claims,  damages or liabilities relating
thereto  arise only out of the gross  negligence  or willful  misconduct  of the
Indemnified  Parties. If, for any reason, the foregoing indemnity is unavailable
to the Indemnified  Parties or is  insufficient to hold the Indemnified  Parties

                                       -8-
<PAGE>

harmless  (other  than  in  the  event  that  the  losses,  claims,  damages  or
liabilities  relating  thereto arise only out of the gross negligence or willful
misconduct  of the  Indemnified  Parties),  then Helix shall  contribute  to the
amount  paid or  payable  by  Indemnified  Parties  as a result of such  claims,
liabilities,  losses,  damages, or expenses in such proportion as is appropriate
to reflect not only the relative  benefits received by Helix on the one hand and
the Indemnified  Parties on the other,  but also the relative fault of Helix and
the   Indemnified   Parties,   as   well   as  any   equitable   considerations.
Notwithstanding the provisions of this Agreement,  the aggregate contribution of
the Indemnified Parties to all claims, liabilities, losses, damages and expenses
shall not exceed the amount of the fees actually received by Consultant pursuant
to its  engagement  by Helix.  It is hereby  further  agreed  that the  relative
benefits to Helix on the one hand and the Indemnified  Parties on the other hand
with respect to the transactions contemplated in the engagement referenced above
shall be  deemed  to be in the same  proportion  as (i) the  total  value of the
transaction  bears to (ii) the fees  paid to  Consultant  with  respect  to such
transactions.   Helix  agrees  that  the   indemnification   and   reimbursement
commitments  set  forth  in  this  Agreement  shall  apply  whether  or not  the
Indemnified   Parties  are  a  formal  party  to  any  such  lawsuits  or  other
proceedings,  that the  Indemnified  Parties  are  entitled  to retain  separate
counsel  of their  choice in  connection  with any of the  matters to which such
commitments  relate, that such commitments shall be in addition to any liability
that Helix may have to the Indemnified  Parties at common law or otherwise,  and
that such commitments shall extend upon the terms set forth in this Agreement to
any  controlling  person,  director,  officer,  employee,  agent or affiliate of
Indemnified  Parties  and  shall  survive  any  termination  of this  Agreement;
provided   that  any  such  claim  arising  other  than  as  a  result  of  this
indemnification  procedure shall serve as a set-off against any claim hereunder.
Notwithstanding   the  provisions  of  Section  1  above,  the   indemnification
provisions of the Prior Agreement shall survive this novation and the provisions
of this Section 16 shall serve to supplement the provisions therein.

     17. Termination.
     ----------------
     This  Agreement may be  terminated  by either party upon 30 days'  advanced
written notice to the other party. Any securities which have not vested pursuant
to the retained  provisions of the Prior  Agreement or have not  otherwise  been
earned pursuant to this Agreement shall automatically be terminated and canceled
and Helix  shall have no further  obligation  to  Consultant  or the  Consulting
Principal in respect of such securities. Subsection 2.8 and Sections 8 and 16 of
this Agreement shall survive the expiration or termination of this Agreement.

     18. Activities of Consultant.
     -----------------------------
     In connection with this engagement, it is understood that Consultant and/or
the Consulting  Principal may identify and facilitate  contact between Helix and
corporations  or  individuals  that may  potentially  become the  Helix's  joint
venture partners,  licensees,  commercial  collaborators,  agents, directors, or
investors. To the extent that Consultant and/or the Consulting Principal contact
corporations  or individuals  as potential  joint venture  partners,  licensees,
commercial collaborators,  agents,  directors, or investors,  Helix acknowledges
that  Consultant's  and/or the Consulting  Principal's sole role is to initially
contact  such   potential   joint  venture   partners,   licensees,   commercial
collaborators,  agents,  directors, or investors and refer any resulting contact
to  Helix  or  its  designated  agent(s).  Accordingly,  Consultant  and/or  the
Consulting  Principal  shall have no  liability  to Helix or any other person or

                                       -9-
<PAGE>

party resulting from their so acting in connection with initiating such contacts
referenced  herein.  It  is  explicitly  agreed  that  Consultant's  and/or  the
Consulting  Principal's  role under this  engagement  will not include,  without
limitation:   performing  due  diligence;   verifying  information  provided  to
Consultant an/or the Consulting  Principal or, directly or indirectly,  to other
persons or parties pursuant to contacts made by Consultant and/or the Consulting
Principal as contemplated by this paragraph;  preparing any offering  memoranda;
or,   negotiating   or  structuring   any   agreements,   licenses,   commercial
collaborations, or investments by or with third parties.

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

                                          HELIX BIOMEDIX, INC.

                                          By: /s/ R. Stephen Beatty
                                              ---------------------------------
                                              R. Stephen Beatty, President
                                              and Chief Executive Officer

                                          DUNSFORD HILL CAPITAL PARTNERS, INC.

                                          By: /s/ Randall L.-W. Caudill
                                              ---------------------------------
                                              Randall L.-W. Caudill, President

                                          CONSULTING PRINCIPAL

                                          /s/ Randall L.-W. Caudill
                                              ---------------------------------
                                              Randall L.-W. Caudill

                                      -10-

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