EXHIBIT 10.46(1)
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This
Amended and Restated Employment Agreement (the
“Agreement”), effective as of the 12 day of March,
2008, between Immtech Pharmaceuticals, Inc., a Delaware
corporation (the “Company”), and Mr. Eric L.
Sorkin, an individual residing in Montclair, New Jersey (the
“Executive”).
W I T N E S S E T H:
WHEREAS,
the Company desires to continue to employ the Executive as
President and Chief Executive Officer of the Company upon the
terms and conditions set forth herein; and
WHEREAS,
Executive is willing to continue such employment upon the
terms and conditions set forth herein;
NOW
THEREFORE, in consideration of the mutual covenants and
agreements contained herein, the parties agree as
follows:
Section
1. Duties
. The Company agrees that Executive shall be
employed by the Company during the Term (as defined below) as
President and Chief Executive Officer of the
Company. Executive shall perform such duties and
shall have such responsibilities consistent with the Bylaws of
the Company, the Company’s polices for senior executive
officers and customary for the duties and position of his
office, in each instance subject to the direction of the Board
of Directors. Executive agrees to be so employed
and shall devote his best efforts to advance the interests of
the Company.
Section
2. Term
. Subject to Sections 4, 5 and 6 hereof, the term
of the Executive’s employment hereunder (the
“Term”) shall be for a period commencing on
January 30, 2006 (the “Effective Date”) to March
31, 2007, and thereafter shall automatically renew for
successive one year periods unless notice of non-renewal is
given by either party not less than 30 days prior to each
successive anniversary date of this Agreement while Executive
is employed.
Section
3. Compensation
.
(a)
Base
Salary . During the Term, beginning on April
1, 2008, Executive shall be paid at a per annum rate of
$250,000 (“Base Salary”) for a one-year period
ending March 31, 2009. Beginning on April 1, 2009, Executive
shall be paid at a per annum rate of
$375,000 (“Base Salary”). The Base Salary shall be
payable by the Company to Executive in accordance with the
Company’s regular payroll practices for senior
management.
(b)
Stock
Options . Executive shall be eligible for
stock option grants (“Options”) under the
Company’s 2007 Stock Incentive Plan or any successor
thereto (collectively, the “Incentive Plan”) as
determined by Executive and the Compensation Committee (the
“Committee”) of the Company’s Board of
Directors or the Committee and the other independent directors
of the Company (as directed by the Board of
Directors). All such Options shall be evidenced by
stock
option
agreements and shall contain the following
terms: (i) the exercise price shall equal the fair
market value of the underlying shares of the Company’s
common stock on the grant date, (ii) the term shall be
ten years, (iii) the Option shall be subject to settlement on
a net share basis (to enable Executive to make a cashless
exercise and payment of minimum statutory tax liabilities),
(iv) the Option shall be an incentive stock option to the
extent possible, and (v) the Option shall remain
exercisable for the full term, whether or not Executive
remains employed with the Company.
(c)
Bonuses
. Executive shall be eligible to receive an annual
performance bonus in cash of up to 60% of the Base Salary for
each year of employment hereunder, beginning with the fiscal
year ending March 31, 2008. Any such bonus shall be
determined in the sole discretion of the Committee or the
Committee and the other independent directors of the Company
(as directed by the Board of Directors) based on certain
milestones determined in the sole discretion of the Committee
or the Committee and the other independent directors of the
Company (as directed by the Board of
Directors). Any bonus due Executive under this
Section 3(c) shall be payable by the Company to Executive
within 120 days after end of the Company’s applicable
fiscal year.
(d)
Vacation, Sick
Leave and Holidays. During the Term,
Executive shall be entitled to 20 days paid vacation on
an annual basis, and shall be entitled to sick leave and
holidays at full pay (beginning on April 1, 2007) in
accordance with the Company’s policies established and
in effect from time to time.
(e)
Welfare
Benefits . During the Term, Executive shall
be entitled to participate in all insurance, retirement,
employee benefits, pension and profit-sharing plans and other
fringe benefit programs established by the Company, including
health insurance (collectively, “Welfare
Benefits”).
(f)
Reimbursement of
Expenses . During the Term, Executive shall
be reimbursed for all items of travel and entertainment and
miscellaneous expenses reasonably incurred by him on behalf of
the Company. Executive shall, as a condition of
such reimbursement, provide sufficient documentation in such
detail as will allow Company to deduct such
expenses. Reimbursement of expenses not claimed
within sixty (60) days after incurred shall be deemed waived,
and all reimbursement payments for a particular calendar year
shall be paid within two and one half months after the end
thereof.
(g)
Severance
. Upon termination of Executive’s employment
hereunder by the Company without Cause (as defined below),
including non-renewal of the Agreement by the Company, or by
Executive for Good Reason (as defined below (other than
pursuant to Section 4 or 5 below), the Company will pay or
provide to the Executive (the following, collectively,
“Severance”): (1) salary, at the greater of
(i) $375,000 and (ii) Executive’s Base Salary rate in
effect on the date of termination, equal to six months,
payable in accordance with normal payroll practices applicable
to the Company’s senior executives, (2) Welfare Benefits
and insurance in which Executive was a participant or which
covered Executive on the date of termination (less any amounts
Executive is paying immediately prior to such termination to
participate in such Welfare Benefits or insurance) for the
twelve month period following any such termination (or, at the
Company’s option, the Company may provide to Executive
after-tax payments to purchase
equivalent
benefits), (3) a cash bonus, on the date on which such bonus
would otherwise be due under Section 3(c) hereof, equivalent
to the cash bonus amount to which Executive would have been
entitled had he continued working until the end of the then
current Term and (4) immediate vesting of all outstanding
options then held by Executive, and the right to exercise such
options for the remainder of their respective
terms. The Severance shall be the sole payment and
shall satisfy all obligations of the Company and its
affiliates to Executive in the event of any such termination
of Executive’s employment and shall be contingent on
Executive’s execution of the Company’s standard
release and waiver agreement. To the extent the
value of the Severance paid to Executive under clauses (1)
through (4) of this Agreement is equal to or less than
Executive’s annualized Base Salary as of the date of his
termination, the Severance is being paid to Executive in
consideration for Executive’s non-competition covenant
set forth in Section 13 hereof.
(h)
Insurance
. During the Term, subject to insurability of
Executive, the Company shall provide Executive with disability
insurance in an amount not less than $375,000 or
Executive’s Base Salary then in effect that would have
been payable pursuant to the terms of this
Agreement.
Section
4. Death or Total
Disability of Executive .
(a)
Death
. In the event of the death of Executive during the
Term, this Agreement shall terminate effective as of the date
of the Executive’s death and the Company shall have no
further obligations or liability hereunder, except the Company
shall pay or provide to the Executive’s estate (i)
twelve months of the Executive’s then current Base
Salary or $375,000 if not then receiving a Base Salary
(payable in accordance with the Company’s normal payroll
practices for senior management) and a pro rata share of
the cash bonus under Section 3(c) for the period up to the
date of termination, (ii) all amounts due pursuant to the
Welfare Benefits and insurance in which Executive was a
participant or covered and (iii) immediate vesting of all
options then held by Executive and the right to exercise the
options through the remainder of their respective
terms.
(b)
Total
Disability .
