Exhibit 10.21
EXECUTIVE EMPLOYMENT
AGREEMENT
(Shintaro Asako)
This EXECUTIVE EMPLOYMENT AGREEMENT
(this “ Agreement ”) is made as of July 18, 2005
(the “ Effective Date ”) by and between
MEDICINOVA, INC, a Delaware corporation (“ MediciNova
”), and Shintaro Asako (“ Executive ”),
with reference to the following facts:
A. The Board of Directors of
MediciNova (the “ Board ”) has determined that
it would be in the best interests of MediciNova to enter into this
Employment Agreement on the terms herein set forth.
B. Executive is willing to serve as
an employee of MediciNova upon the terms and conditions herein set
forth. In respect of such employment, Executive has also executed
that certain Proprietary Information and Inventions Agreement of
even date herewith (the “ Proprietary Information and
Inventions Agreement ”), which is attached hereto as
Exhibit A and incorporated herein by reference as though
fully set forth herein.
NOW, THEREFORE, in consideration of
the foregoing premises and the mutual covenants herein contained,
the parties agree as follows:
1. Definitions . For purposes
of this Agreement, the following terms shall have their respective
meanings:
1.1 “ Cause ”
shall mean (as shall reasonably be determined by the Board of
Directors of the MediciNova - the “ Board ”):
(i) any intentional failure to perform the Executive’s
obligations, services or duties under this Agreement or any other
agreement or arrangement between the Executive and the MediciNova
regarding employment or consulting services to be rendered by the
Executive to the MediciNova, other than an immaterial violation
which is remedied upon reasonable notice; (ii) failure to achieve
performance levels for the MediciNova consistent with the
MediciNova’s goals, as determined by the Board in good faith
and following appropriate inquiry; (iii) any violation of
MediciNova policy, other than an immaterial violation which is
remedied upon reasonable notice; (iv) any willful neglect of the
Executive’s duties to the MediciNova or gross misconduct; (v)
any failure to protect the MediciNova’s trade secrets; or
(vi) any commission of any crime or criminal offense involving
moral turpitude.
1.2 “ Total and Permanent
Disability ” shall have the meaning ascribed to such term
in Section 22 of the Internal Revenue Code of 1986, as
amended.
2. Duties . Subject to the
terms and provisions of this Agreement, Executive is employed by
MediciNova as an executive employee of MediciNova.
Executive’s specific position shall be as the Vice President,
Accounting and Financial Reporting of MediciNova; provided ,
however , that the Executive may be reassigned by the Board
to another executive position with MediciNova (or another position
of similar responsibility) at such time as the Board (excluding
Executive) reasonably agrees upon another Vice President,
Accounting and Financial Reporting. Executive covenants to perform
Executive’s employment duties in good
MediciNova, Inc.
faith. Executive shall at all times during the
performance of this Agreement strictly adhere to and obey any and
all rules and regulations now in effect or as subsequently adopted
and/or modified governing the conduct of MediciNova employees
and/or executives (the “ Employment Policies ”).
In the event of any conflict between the provisions of this
Agreement and any of the Employment Policies, the provisions of
this Agreement shall control. A default under any the Employment
Policies, except to the extent necessary or appropriate to comply
with the provisions of this Agreement, shall be a default under
this Agreement.
3. Exclusive Services .
Executive’s entire business time, attention, energies,
skills, learning and best efforts shall be devoted to the business
of MediciNova; provided , however , that this Section
3 shall not be construed as preventing Executive from participating
in social, civic or professional associations or engaging in
passive outside investment activities which may require a limited
portion of time and effort to manage, consistent with any
Employment Policies and so long as such
activities do not interfere with the performance of
Executive’s duties nor compete, in any way, with the products
or services offered by or through MediciNova.
4. Term of Employment . The
term of this Agreement shall continue until such time as the
employment of Executive is terminated pursuant to Section 7 below;
provided , however , that this Agreement shall
automatically terminate upon the death or Total and Permanent
Disability of Executive.
5. Compensation . For all
services rendered by Executive to MediciNova, MediciNova shall
pay/provide to Executive the following:
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base
compensation in the amount of $ 150,000 per annum (the
“ Base Compensation ”);
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periodic
bonuses determined within the sole discretion of the Board (or any
committee of the Board which is appointed to consider matters
relating to executive compensation) but with reference to amounts
paid to other executives and/or employees of MediciNova;
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grants of
equity-based compensation within the sole discretion of the Board
(or any committee of the Board which is appointed to consider
matters relative to equity-based compensation);
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such group
medical and life insurance and participation in other benefit plans
as shall be made available for executives of MediciNova (with
amounts and levels of participation therein determined with
reference to other executives and/or employees of MediciNova);
and
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an annual
amount of vacation days consistent with amounts available for other
executives of MediciNova (but, in any event, no fewer than 10
days)(collectively, the “ Compensation Package
”).
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6. Adjustments . The amount
of Base Compensation may be adjusted as of each anniversary of the
Effective Date (beginning on the first anniversary) by an amount
upon which the Board and Executive shall mutually and reasonably
agree at or about that time.
MediciNova, Inc.
Compensation under the Compensation Package
shall be paid to Executive less required deductions for Social
Security, withholding taxes and other authorized deductions and at
times when executives of MediciNova normally receive their
compensation.
7. Termination . The
employment of Executive may be terminated at any time
by:
7.1 Mutual agreement of MediciNova
and Executive evidenced in writing;
7.2 Action of the Board without
prior notice to Executive if the Board reasonably shall establish
that (i) Executive is in material default in the performance of
Executive’s obligations, services or duties hereunder, or has
materially breached any provision of this Agreement, or (ii)
MediciNova otherwise has Cause to terminate Executive’s
employment (although the right of termination of Executive’s
employment under this Section 7.2 shall not be in limitation of any
other right or remedy MediciNova may have under this Agreement or
otherwise);
7.3 Upon the death or Total and
Permanent Disability of Executive; or
7.4 Upon three months’ written
notice by either party to the other indicating the desire of the
notifying party, in its sole discretion, to terminate the
employment of Executive hereunder.
8. Compensation Upon
Termination . In the event that the employment of Executive is
terminated pursuant to Section 7 above, Executive shall be
terminated without compensation other than for accrued salary and
other accrued amounts; provided , however , that if
such employment is terminated at MediciNova’s option pursuant
to Section 7.4 above, then Executive shall be entitled to such
severance payment(s) as shall be provided for (if any) by the
Employment Policies in effect at that time; and provided ,
further , that in lieu of the three months’ notice
provided by Section 7.4 above, MediciNova may provide Executive
with an amount equal to one-half (1/2) of Executive’s annual
Base Compensation which shall be applicable at the time of
Executive’s termination of employment with MediciNova. Except
as provided in the immediately preceding sentence (if applicable),
Executive is entitled to no other compensation upon
termination.
9. Option to Hire Executive as
Consultant . Upon any termination of Executive’s
employment under this Agreement, either pursuant to Section 7 above
or otherwise, MediciNova shall have the option (in
MediciNova’s discretion) to engage Executive as a consultant
on a quarterly basis commencing on the effective date of
termination of Executive’s employment (the “
Termination Date ”) and continuing for a period of up
to one ( 1 ) year following the Termination Date (or,
if longer, the period terminating on the date which is three
( 3 ) years after the Effective Date). MediciNova’s
rights under this Section 9 shall lapse if MediciNova has not
provided Executive with written notice of MediciNova’s intent
to exercise its rights hereunder prior to the later of (i) the
Termination Date (e.g., in the event of a voluntary termination
under Section 7.4 above) and (ii) 30 days following notice of such
termination (e.g., in the event of an involuntary termination under
Section 7.2 above). As a consultant, Executive’s duties shall
include devoting attention to those matters reasonably requested by
the Board but which will not interfere (as to time required) with
the opportunity to maintain other employment consistent
with
MediciNova, Inc.
this Section 9. During any period for which
Executive is engaged to perform consulting services for MediciNova
under this Section 9, Executive agrees that Executive shall
not:
9.1 Carry on directly or indirectly,
whether or not for compensation (as proprietor, partner,
stockholder (except that a less than one percent (1%) ownership in
a public corporation shall be permitted), officer, director, agent,
employee, consultant, trustee, affiliate or otherwise), any
business which is, or as a result of Executive’s engagement
or participation would become, competitive with or adverse to the
business of MediciNova as it exists as of the Termination
Date;
9.2 Permit Executive’s name to
be used by any business competitive in any respect with the
business of MediciNova as it exists as of the Termination
Date;
9.3 Solicit or divert, or attempt to
call on, solicit or divert, any customer of MediciNova with whom
Executive became acquainted during Executive’s employment or
affiliation with MediciNova, either for Executive or for any other
person, firm or corporation; or
9.4 Induce or attempt to induce any
person who is an employee, agent or consultant of MediciNova to
leave the employ of MediciNova.
Without limiting the other provisions of this
Agreement, (i) Executive acknowledges and agrees that it is
impossible to measure in money the damages which will befall the
MediciNova by reason of Executive’s failure to perform any of
the obligations set forth in this Section 9, (ii) Executive
acknowledges that MediciNova shall be entitled to enforce
Executive’s obligations under this Section 9 by court
injunction (without the posting of a bond or other security),
specific performance or other appropriate equitable relief, (iii)
Executive agrees (to the maximum extent permitted by law) to have
the provisions of this Section 9 specifically enforced against
Executive by any court of equity and (iv) Executive consents to the
entry of injunctive relief against Executive enjoining or
restraining any violation or threatened violation of the provisions
of this Section 9.
10. Compensation for Consulting
Services . For each quarter (i.e., three-month period) that
Executive provides consulting services to MediciNova pursuant to
the option of MediciNova contained in Section 9 above, MediciNova
shall pay Executive a sum equal to fifteen percent (
15% ) of Executive’s annual Base Compensation which
shall be applicable at the time of Executive’s termination of
employment with MediciNova (prorated for any period of less than a
quarter). The parties expressly agree that when Executive is
performing consulting services for MediciNova, Executive is acting
as an independent contractor. Therefore, Executive shall be solely
liable for Social Security and income taxes that result from
Executive’s compensation as a consultant. In addition,
Executive shall not be entitled to any other benefits including,
without limitation, such group medical, life and disability
insurance and other benefits as may be provided to employees and/or
executives of MediciNova.
11. Dispute Resolution
Procedure . Any dispute arising out of or related to the
employment relationship created hereby, including the termination
of that relationship and any allegations of unfair or
discriminatory treatment arising under state or federal law or
otherwise, to the maximum extent permitted by law, shall be
resolved by final and binding arbitration, except where the law
specifically forbids the use of arbitration as a final and binding
remedy, or
MediciNova, Inc.
where section (d) below specifically allows a
different remedy. The following dispute resolution procedure shall
apply:
11.1 The party claiming to be
aggrieved shall furnish to the other party a written statement of
the grievance identifying any witnesses or documents that support
the grievance and the relief requested or proposed.
11.2 The responding party shall
furnish a statement of the relief, if any, that it is willing to
provide, and the witnesses or documents that support its position
as to the appropriate action. The parties can mutually agree to
waive this step. If the matter is not resolved at this step, the
parties shall submit the dispute to non-binding mediation before a
mediator to be jointly selected by the parties. MediciNova will pay
the cost of the mediation.
11.3 If the mediation does not
produce a resolution of the dispute, the parties agree that the
dispute shall be resolved by final and binding arbitration. The
parties shall attempt to agree to the identity of an arbitrator,
and, if they are unable to do so, they will obtain a list of
arbitrators from the Federal Mediation and Conciliation Service and
select an arbitrator by striking names from that list. The
arbitrator shall have the authority to determine whether the
conduct complained of in subsection (a) of this section violates
the rights of the complaining party and, if so, to grant any relief
authorized by law, subject to the exclusions of subsection (d)
below. The arbitrator shall not have the authority to modify,
change or refuse to enforce the terms of any employment agreement
between the parties. In addition, the arbitrator shall not have the
authority to require MediciNova to change any lawful policy or
benefit plan. The hearing shall be transcribed. MediciNova shall
bear the costs of the arbit
