Employment Agreement - DrugAbuse Sciences Inc. and Jacques Kusmierek
[DAS LOGO]
DRUGABUSE SCIENCES, INC.
1430 O'Brien Drive, Suite E
Menlo Park, CA 94025
-------------------------------------------------------------------------------
(650) 462-1000 FAX: (650) 462-1003
December 28 , 1999
Jacques Kusmierek, M.D.
47 rue St Lambert
75015 Paris
Re: Employment Agreement
Dear Jacques:
On behalf of DrugAbuse Sciences, I am pleased to confirm our proposal for you
to become a DrugAbuse Sciences employee. This offer is conditional upon our
completion of satisfactory referencing, your acceptance of the terms and
conditions of this offer of employment and your execution of the attached
Employee Confidential Information and Inventions Agreement.
Your position with DrugAbuse Sciences will be Senior Vice President, European
Development (DrugAbuse Sciences Inc.) and Directeur General Adjoint
(DrugAbuse Sciences SAS). As we discussed, your position is a full-time
position and your employment will commence no later than February 3, 2000
(the date your employment commences is referred to as your Start Date.)
Your total full time gross base salary will be 140,000 Euros per year,
payable at the frequency and in accordance with DrugAbuse Sciences' regularly
established payroll policies. All payments to you will be subject to legally
required withholding. It is DrugAbuse Sciences' policy to review salary and
compensation levels periodically. Accordingly, your base salary and other
compensation may be adjusted from time to time at DrugAbuse Sciences' sole
discretion; raises in compensation are not guaranteed. In addition to your
base salary, you may receive within three months following each yearend, at
the Board of Directors sole discretion, up to a 20% bonus (i.e. 20% of the
paid base salary) subject to meeting specific annual milestones defined by
DrugAbuse Sciences CEO (Exhibit A).
DrugAbuse Sciences also has a company Stock Option Plan (which the company
may modify from time to time) that may permit our employees to participate in
the equity ownership of the company. We expect to include you as a
participant in that plan and will recommend to the Company's Board of
Directors that you be granted a stock option for 700,000 shares of common
stock according to the October 1999 capitalization table; with the exercise
price equal to the fair market value on the date of your Start Date. These
options will be subject to the terms of the then applicable Stock Option
Plan, California and French law (e.g. no sale for five years), and to the
following vesting schedule: (i) 70,000 shares would vest solely upon the
first anniversary of continuous employment; (ii) 5,833 shares would vest
monthly over the three years subsequent to the first year anniversary; (iii)
420,000 shares would vest solely upon the sixth anniversary of continuous
employment; However, at the sole discretion of the board of directors and
upon fully and timely achieving the following milestones, acceleration of
vesting for the corresponding shares would occur at
<PAGE>
the time of milestone achievement, up to a total of 420,000 shares.
Milestones with corresponding shares are as follows:
(1) For 180,000 shares: Naltrel NDA European market approval and product
launch (alcohol and opiate indications), if by June 30, 2002.
(2) For 120,000 shares: European market approval for a second new drug
candidate substantially developed by DrugAbuse Sciences, if by
December 31, 2003.
(3) For 60,000 shares: Naltrel FDA NDA approval (alcohol and opiate
indications), if by March 31, 2002.
(4) For 40,000 shares: DAS SAS having received funding for at least
$5,000,000 from new European research grant(s) (other than
Scandinavian and French grants), if by December 31, 2001.
(5) For 20,000 shares: Upon DAS successful initial public offering if by
April 30, 2001.
You will also be eligible to participate in the employee benefits
collectively available to our employees.
You will devote your best efforts to the performance of your job for
DrugAbuse Sciences. While employed at DrugAbuse Sciences, you will not
undertake any other activity requiring your business time and attention, nor
will you support any activity that is competitive with DrugAbuse Sciences'
business or pose a conflict of interest with that business. You will follow
all DrugAbuse Sciences' policies and procedures as made available to you from
time to time. As a condition of your employment, you will execute DrugAbuse
Sciences' Employee Confidential Information and Inventions Agreement.
Your employment with DrugAbuse Sciences will be "at will"; in other words,
either you or DrugAbuse Sciences will have the right to terminate your
employment with DrugAbuse Sciences at any time, for any reason, and (i) with
respect to DrugAbuse Sciences Inc. with or without cause, and no severance
will apply to termination, and (ii) with respect to DrugAbuse Sciences SAS in
a manner consistent with the Convention de l'Industrie Pharmaceutique.
Initially your employment will be solely with DrugAbuse Sciences SAS. As
DrugAbuse Sciences activities expand further in Europe, your employment would
be shared in part with another DrugAbuse Sciences European subsidiary.
Jacques, we are very excited about your joining us. Please sign and return a
copy of this letter and the attached Employee Confidential Information and
Inventions Agreement to me, keeping a copy of each for your records. The
terms set forth in this letter supersede all prior agreements, understandings
and representations between us concerning the subject matter of this letter.
This offer if not accepted, will expire on January 4, 2000. Changes to your
employment agreement would apply only if in writing and signed by the
DrugAbuse Sciences Inc. CEO, and DrugAbuse Sciences SAS president. We look
forward to you becoming a member of our team !
Sincerely,
/s/ Philippe Pouletty
Philippe Pouletty, M.D.
Chairman and CEO, DAS Inc., President, DAS SAS
<PAGE>
I, Jacques Kusmierek, M.D., understand and agree to the above terms. I
understand that my employment with DrugAbuse Sciences is at will, and I
acknowledge that no representations or promises other than those set forth above
have been made to me with regard to the terms and conditions of my employment.
Signed: /s/ Jacques Kusmierek Date:
-------------------------------- ------------------------
EXHIBIT A
First year potential 20% Cash Bonus based on fully and timely achieving three
key milestones over the first twelve months, and at the sole discretion of the
board of directors:
(1) Having filed COC Ab IND by March 31, 2000 and initiated phase I
trial in Q2 2000,
(2) Having defined the detailed European development and regulatory plan
for Naltrel targeting a first filing for market approval in Q1 2001
(3) Having performed at least one Naltrel trial in Europe in 2000