EXHIBIT 10.60
August 9, 2005
Xxxxxx X. Xxxxx
La Jolla Pharmaceutical Company
0000 Xxxxx Xxxxx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Dear Xxxxx,
On April 19, 2005, you and La Jolla Pharmaceutical Company (the
"Company") entered into an agreement (the "Retention Agreement") which provided
you with the potential to earn bonuses upon the occurrence of certain events.
The purpose of this letter is to clarify how the Retention Agreement would
operate in the context of certain transactions not expressly addressed in the
Retention Agreement in order to continue to retain your services and to
incentivize you to remain an employee of the Company.
1. If, on or prior to September 30, 2005, the Company executes a
definitive agreement that provides for a sale of equity securities that results
in the Company receiving gross proceeds (before expenses) of $50 million or
more, the Company will pay you the Riquent Bonus (as such term is defined in the
Retention Agreement). In this circumstance, provided that the transaction
contemplated by such agreement closes and that, subject to paragraph 4 hereof,
you are employed by the Company through the closing date, the Riquent Bonus will
be paid in a lump sum within two business days after the closing of such
financing transaction.
2. If, on or prior to September 30, 2005, the Company executes a
definitive agreement that provides for a sale of equity securities that results
in the Company receiving gross proceeds (before expenses) of $20 million or
less, the Company will pay you the Financing Bonus (as such term is defined in
the Retention Agreement). In this circumstance, provided that the transaction
contemplated by such agreement closes and that, subject to paragraph 4 hereof,
you are employed by the Company through the closing date, the Financing Bonus
will be paid in a lump sum within two business days after the closing of such
financing transaction.
3. If, on or prior to September 30, 2005, the Company executes a
definitive agreement that provides for a sale of equity securities that results
in the Company receiving gross proceeds (before expenses) of more than $20
million but less than $50 million, the Company will pay you a bonus (the
"Intermediate Financing Bonus") equal to the Financing Bonus plus an amount
equal to 1% of your Salary for each additional $1 million in gross proceeds to
the Company, less applicable withholdings and deductions. For example, if the
Company were to raise $30 million in gross proceeds, your Intermediate Financing
Bonus would equal 30% of your Salary (the Financing Bonus, which is 20% of your
Salary, plus an additional 10%, or 1% of your Salary for each $1 million raised
by the Company above $20 million). In this circumstance, provided that the
transaction contemplated by such agreement closes and that, subject to paragraph
4 hereof, you are employed by the Company through the closing date, the
Intermediate Financing Bonus will be paid in a lump sum within two business days
after the closing of such financing transaction.
4. In the event that the Company terminates you without cause after the
date hereof and any bonus under the Retention Agreement or this letter
agreement becomes payable, the Company shall be obligated to make the applicable
bonus payment to you. For the sake of clarity, if you voluntarily leave your
employment or are terminated for cause, you shall not be entitled to any bonus
under the Retention Agreement or hereunder.
5. You will continue to be bound by the Company's policies and this
letter does not change your employment status with the Company. As with all
employees at the Company, you or the Company may, subject to the terms of any
contractual agreement you may have with the Company, terminate your employment
at any time for any reason whatsoever, with or without cause or advance notice.
This letter together with the Retention Agreement constitutes the full
and complete expression of our arrangements with respect to the SSAO Bonus, the
Riquent Bonus, the Intermediate Financing Bonus and the Financing Bonus and
supersedes any prior oral commitments or representations. Neither this letter
nor the Retention Agreement may be modified except by a written instrument
approved and signed by both you and the Company.
Sincerely,
/s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx, Ph.D.
Chairman of the Compensation Committee
of the Board of Directors
ACKNOWLEDGEMENT
I hereby acknowledge that I have read and understand this letter
agreement and I agree and accept the terms of set forth herein as of the date
first set forth above.
/s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx
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