IMMUNOTHERAPEUTICS, INC.
June 25, 1996
Xxxxxx Xxxxxx, M.D.
0000 Xxxxxxxxx Xxxxxx Xxxxx
Xxxxx, Xxxxx Xxxxxx 00000
Letter Agreement, Amendment and Waiver
Dear Xx. Xxxxxx:
In connection with the purchase by Aries Domestic Fund,
L.P., a Delaware limited partnership (the "Fund"), and the Aries
Trust, a Cayman Islands Trust (the "Trust", and collectively with
the Fund, the "Purchasers") of 5,000,000 shares of Common Stock
of ImmunoTherapeutics, Inc., a Delaware corporation (the
"Company"), directly from the Company and the purchase by the
Purchasers of 4,000,000 shares of the Company's Common Stock from
Dominion Resources, Inc., a Delaware corporation, the Company and
Xx. Xxxxxx X. Xxxxxx (the "Executive" and the Company,
collectively referred to as the "Parties") wish to enter into an
agreement as follows:
(1) The Parties have agreed that the Company may hire a
Chief Executive Officer who, if hired, will have the
corporate title of President, which such title will be
relinquished by Executive. Executive expressly agrees
to relinquish such title and agrees to the hiring of
such CEO and the conduct by such CEO of the duties
assigned him by the Board of Directors. The Executive
agrees that the hiring of such CEO will not constitute
"Good Reason" as such term is defined in the Employment
Agreement between the Company and Executive dated June
1, 1996 (the "Employment Agreement") and will not be
grounds for the Executive to terminate his employment
for "Good Reason" as provided pursuant to the
Employment Agreement. Executive further agrees that
the Company may take any of the foregoing actions and
such actions will not result in any breach or violation
of any provisions of the Employment Agreement or
entitle the Executive to any payments or severance pay
under the terms of the Employment Agreement. The
Executive hereby waives any claims or causes of action,
whether based on contract or otherwise, in any way
related to or arising out of such actions.
(2) The Executive hereby agrees that the acquisition of the
shares of Common Stock of the Company by the Purchasers
(including any purchases made subsequent to the date
hereof) and the appointment by Purchasers of any
representatives to the Board of Directors or other
change in the configuration of the Board of Directors
by Purchasers did not and will not constitute (x) a
"change in control of the Company" or "Good Reason" as
such terms are defined in the Employment Agreement and
will not be grounds for the Executive to terminate his
employment with the Company or (y) a "change of
control" or other event giving rise to a cancellation
of the Option under Section 5(b), (c) or (d) of the
Stock Option Agreement (the "Option") dated March 21,
1996 or any other option agreement to which the
Executive is a party (collectively with the Option, the
"Options"). Executive further agrees that such
acquisitions of shares or future acquisitions of shares
or changes to the configuration of the Company's Board
of Directors did not and will not result in any breach
or violation, or acceleration of any rights to payment
pursuant to any provisions of the Employment Agreement
or Options or entitle the Executive to any payments,
accelerated rights or severance pay under the terms of
the Employment Agreement or Options. The Executive
hereby waives any claims or causes of action, whether
based on contract or otherwise, in any way related to
or arising out of such actions.
(3) The Executive hereby agrees to amend paragraph 8(d)(ii)
of the Employment Agreement to read as follows:
(ii) in lieu of any further salary payments to the
Executive for periods subsequent to the Date of
Termination, the Company shall pay as severance
pay to the Executive an amount equal to the
product of (A) the Executive's annual salary rate
in effect as of the Date of Termination,
multiplied by (B) the number of years (including
partial years) remaining in the term of employment
hereunder, such payment to be made in
substantially equal monthly installments
commencing with the month in which the Date of
Termination occurs and continuing for the number
of consecutive monthly payment dates (including
the first such date as aforesaid) equal to the
product obtained by multiplying the number of
years (including partial years) applicable under
(ii)(B) above by twelve (12); and
The foregoing language shall be substituted for and
shall replace the language in paragraph 8(d)(ii).
(4) The Executive hereby agrees that the Employment
Agreement shall be amended to delete any reference to
the term "change in control of the Company" and agrees
that he shall not be entitled to terminate his
employment with the Company or to any additional
severance or termination payments as a result of the
occurrence of any events which satisfy the definition
of "change of control of the Company" in Section 7(d)
of the Employment Agreement.
(5) The Executive hereby agrees that the Option shall be
amended to delete Sections 5(b), (c) and (d) and the
Executive hereby waives any rights to any payments
pursuant to those provisions.
(6) The Executive hereby agrees that from the date hereof
and continuing for a period (the "Lock-Up Period") of
twenty four (24) months from the date hereof, he will
not, without the prior written consent of Aries
Financial Services, Inc., offer, pledge, sell, contract
to sell, grant any option for the sale of, or otherwise
dispose of, directly or indirectly, any shares of any
equity securities of ImmunoTherapeutics, Inc. (the
"Company") or any options, warrants or other securities
convertible into equity securities of the Company (the
"Shares") provided however that, on the date twelve
months from the date hereof, an amount of Shares equal
to 25% of the number of Shares currently owned by the
Executive (as set forth in the Company's current SEC
filings) shall become exempt from the lock-up
provisions contained in this sentence. In addition,
Executive agrees that while Executive hold any Shares,
Executive will not directly or indirectly, through
related parties, affiliates or otherwise sell "short"
or "short against the box" (as those terms are
generally understood) any equity security of the
Company. Notwithstanding the foregoing, (i) the
Executive will be permitted to transfer his shares in
private sale transactions pursuant to a valid private
placement exemption provided any transferee in
connection with such any such transaction expressly
consents in writing to be subject to the same
restrictions and agreements applicable to such shares
as Executive was hereunder, pursuant to the Employment
Agreement and the Option Agreement.
This letter agreement shall not be amended or modified
without the prior written consent of both Parties and Aries
Financial Services, Inc, a Delaware corporation. Aries Financial
Services, Inc. and the Purchasers shall be third party
beneficiaries of this letter agreement, have relied on the
provisions contained herein and shall be entitled to enforce the
rights of the Company hereunder. This letter agreement shall act
as a complete release of the Company from all claims which the
Executive had with respect to any of the matters with respect to
which the Executive agreed to waive, forego or amend any rights
as provided herein.
If you agree with the foregoing, please execute a copy
of this letter in the space provided below and return the
executed copy to me whereupon this letter will become a binding
agreement among the Parties.
________________________
IMMUNOTHERAPEUTICS, INC.
Name:
Title: Secretary
AGREED TO AND ACCEPTED AS OF
THE DATE FIRST WRITTEN ABOVE:
XXXXXX XXXXXX, M.D.
_____________________________
