AEOLUS PHARMACEUTICALS, INC.
CONSULTING AGREEMENT
<DOCUMENT>
<TYPE>EX-10.107
<SEQUENCE>6
<FILENAME>dex10107.htm
<DESCRIPTION>CONSULTING AGREEMENT
<TEXT>
<HTML><HEAD>
<TITLE>CONSULTING AGREEMENT</TITLE>
</HEAD>
 <BODY BGCOLOR="WHITE">

 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="right"><FONT FACE="Times New Roman" SIZE="2"><B>Exhibit 10.107 </B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:-6px"><FONT
SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT FACE="Times New Roman" SIZE="2"><B>INCARA PHARMACEUTICALS CORPORATION </B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT
SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT FACE="Times New Roman" SIZE="2">June 8, 2004 </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT FACE="Times New Roman" SIZE="2">Mr. Shayne Gad </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT FACE="Times New Roman" SIZE="2">c/o Incara Pharmaceuticals Corp. </FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT FACE="Times New Roman" SIZE="2">79 T.W. Alexander Drive </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT FACE="Times New Roman" SIZE="2">4401 Research Commons, 200 </FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT FACE="Times New Roman" SIZE="2">Research Triangle Park, NC 27709 </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT FACE="Times New Roman" SIZE="2">Dear Shayne: </FONT></P> <P STYLE="margin-top:0px;margin-bottom:-6px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT
FACE="Times New Roman" SIZE="2">This letter confirms our previous conversations regarding the consulting opportunity available to you with Incara Pharmaceuticals Corporation (the &#147;Company&#148;) and sets forth the terms and conditions of that
consulting. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">The Company hereby offers you a position as the
Company&#146;s Interim President commencing on or about May 1, 2004. During the period of your consulting, you shall devote yourself for two business days each week to work for or at the direction of the Company&#146;s Board of Directors, use your
best efforts to complete all assignments, and adhere to the Company&#146;s procedures and policies in place from time-to-time. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">You will receive a monthly compensation of $19,500. In addition, the Company will also grant you an option to purchase 250,000 shares of Company stock at
current fair market value pursuant to the terms of the 1994 Stock Option Plan, which grant shall be evidenced by the Company&#146;s standard form of grant agreement. In addition, for each full month of consulting, the Company will grant you an
additional option to purchase 25,000 shares of the Company&#146;s stock at fair market value pursuant to the terms of the 1994 Stock Option Plan. The options will be fully vested upon grant. </FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">Currently, we anticipate that you will serve as Interim President for a term
of eight months from May 1, 2004. However, the Company may terminate your consulting sooner if the Company installs a full-time Chief Executive Officer, or if you are terminated for Cause. For purposes of this letter, &#147;Cause&#148; means: (i)
the misappropriation of the funds or property of the Company or any act or fraud or dishonesty with respect to the Company, its business, or its property; (ii) use of alcohol or illegal drugs; (iii) inadequate job performance, as determined by the
Company in its sole discretion; (iv) conviction of a felony or of any crime involving moral turpitude, dishonesty or theft; (v) your commission of any act, or your failure to act, which could reasonably be expected to injure the reputation, business
or business relationships of the Company; (vi) any material breach of any Company policy; or (viii) any violation of applicable law, including without limitation federal and state securities laws. In the event that the Company elects to terminate
your employment on the installation of a full-time Chief Executive Officer, you will be given one (1) month notice before termination. </FONT></P>

<p Style='page-break-before:always'>
<HR  SIZE="3" COLOR="#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">By executing this letter below, you agree that during the course of your consulting and thereafter that
you shall not use or disclose, in whole or in part, any of the Company&#146;s trade secrets, confidential and proprietary information, including customer lists and information, to any person, firm, corporation, or other entity for any reason or
purpose whatsoever other than in the course of your employment with the Company or with the prior written permission of the Company. By signing this letter below, you further acknowledge that you have no claims against the Company up to the date of
your signature and delivery of this letter. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">You are an
independent contractor under this agreement and shall not be deemed an employee of Incara. You will not be entitled to participate in any benefit plan of an Incara employee. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT
SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT FACE="Times New Roman" SIZE="2">Kindly sign your name at the end of this letter to signify your understanding and acceptance of these terms and that no one
at the Company has made any other representation to you. We welcome you and look forward to a successful relationship in which you will find your work both challenging and rewarding. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT
SIZE="1">&nbsp;</FONT></P><DIV ALIGN="right">
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="40%" BORDER="0">

<TR>
<TD WIDTH="100%"></TD></TR>
<TR>
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT FACE="Times New Roman" SIZE="2">Sincerely,</FONT></P></TD></TR>
<TR>
<TD HEIGHT="16"></TD></TR>
<TR>
<TD VALIGN="top"> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P><HR WIDTH="83%" SIZE="1" NOSHADE COLOR="#000000" ALIGN="left"></TD></TR>
<TR>
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT FACE="Times New Roman" SIZE="2">David C. Cavalier</FONT></P></TD></TR>
<TR>
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT FACE="Times New Roman" SIZE="2">Chairman of the Board</FONT></P></TD></TR>
</TABLE></DIV> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT FACE="Times New Roman" SIZE="2">Agreed to and </FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT FACE="Times New Roman" SIZE="2">Accepted by: </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="100%" BORDER="0">

<TR>
<TD WIDTH="50%"></TD>
<TD VALIGN="bottom" WIDTH="3%"></TD>
<TD WIDTH="47%"></TD></TR>
<TR>
<TD VALIGN="top"> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P><HR WIDTH="63%" SIZE="1" NOSHADE COLOR="#000000" ALIGN="left"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="bottom"><FONT FACE="Times New Roman" SIZE="2">Date: _______________________________________________&nbsp;&nbsp;</FONT></TD></TR>
<TR>
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT FACE="Times New Roman" SIZE="2">Shayne Gad</FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD></TR>
</TABLE> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT FACE="Times New Roman" SIZE="2">2 </FONT></P>

</BODY></HTML>

</TEXT>
</DOCUMENT>
