Exhibit 10.32

 

EXECUTIVE EMPLOYMENT AGREEMENT

 

THIS EXECUTIVE EMPLOYMENT AGREEMENT (the “Agreement”) dated August 7, 2016 by
and between Lion Biotechnologies, Inc., a Nevada corporation (the “Company”),
and Frederick Vogt (“Executive”) (either party individually, a “Party”;
collectively, the “Parties”).

 

WHEREAS the Company desires to retain the services of Executive to serve as the
Company's Vice President, Intellectual Property.

 

WHEREAS, the Parties desire to enter into this Agreement to set forth the terms
and conditions of Executive's employment by the Company and to address certain
matters related to Executive's employment with the Company;

 

WHEREAS, both the Company and the Executive have read and understood the terms
and provisions set forth in this Agreement, and Executive acknowledges Executive
has been afforded a reasonable opportunity to review this Agreement with
Executive's legal counsel to the extent desired;

 

NOW, THEREFORE, in consideration of the foregoing and the mutual provisions
contained herein, and for other good and valuable consideration, the Parties
hereto agree as follows:

 

1.            Employment. Effective September 30, 2016 (the “Effective Date”),
the Company hereby employs Executive, and Executive hereby accepts such
employment, upon the terms and conditions set forth herein.

 

2.            Duties.

 

2.1         Position. Executive shall be employed by the Company in the position
of Vice President, Intellectual Property shall have the duties and
responsibilities consistent with the position of Vice President, Intellectual
Property and such other duties and responsibilities assigned by the Company's
Chief Executive Officer. Executive shall perform faithfully and diligently such
duties as are reasonable and customary for Executive's position, as well as such
other duties as the Chief Executive Officer shall reasonably assign from time to
time. Executive shall provide his services hereunder from his home office, with
travel to the Company's offices in New York City and other offices as required
by Company business.

 

2.2         Best Efforts/Full-Time.

 

2.2(a)        Executive understands and agrees that Executive will faithfully
devote Executive's best efforts and substantially all of his time during normal
business hours to advance the interests of the Company. Executive will abide by
all policies duly adopted by the Company, as well as all applicable federal,
state and local laws, regulations or ordinances. Executive will act in a manner
that Executive reasonably believes to be in the best interest of the Company at
all times. Executive further understands and agrees that Executive has a
fiduciary duty of loyalty to the Company to the extent provided by applicable
law and that Executive will take no action which materially harms the business,
business interests, or reputation of the Company.

 

2.2(b)        Executive agrees that Executive will not directly engage in
competition with the Company at any time during the existence of the employment
relationship between the Company and Executive.

 

2.2(c)        Executive agrees that, during the term of this Agreement,
Executive shall work exclusively for the Company. Consequently, Executive agrees
to not engage in any other employment, consulting or other business activity
without the written consent of the Company.

 

3.            At-Will Employment. Executive's employment with the Company will
be “at-will” and will not be for any specific period of time. As a result,
Executive is free to resign at any time, for any or no reason, as Executive
deems appropriate. The Company will have a similar right and may terminate
Executive's employment at any time, with or without cause. Executive's and the
Company's respective rights and obligations at the time of termination are
outlined below in Section 6 of this Agreement.

 

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4.            Compensation.

 

4.1         Base Salary and Sign-On Bonus. As compensation for the performance
of all duties to be performed by Executive hereunder, the Company shall pay to
Executive a base salary of $300,000 per year, less required deductions for state
and federal withholding tax, social security and all other employment taxes and
authorized payroll deductions, payable on a prorated basis as it is earned, in
accordance with the normal payroll practices of the Company (the “Base Salary”).
As a sign-on bonus, Executive will be paid $50,000 (subject to payroll taxes)
with the first paycheck.

 

4.2         Stock Options. As of the Effective Date, Executive shall receive
stock options to purchase an aggregate of 200,000 shares of the Company's common
stock. To the extent legally permitted, the stock options shall be incentive
stock options. The stock options will have an exercise price equal to the fair
market value of the common stock at the close of trading on NASDAQ on the
Effective Date. Provided that Executive is still employed with the Company on
the following dates, the foregoing stock options will vest in three installments
as follows: (i) Options for the purchase of 66,672 shares shall vest on one year
anniversary of the Effective Date; and (ii) the remaining stock options shall
vest as to 16,672 shares at the end of each quarter over the next two years,
commencing with the first quarter following the first anniversary of the
Effective Date. Upon the termination of Executive's employment with the Company,
except as provided herein, the unvested options will be forfeited and returned
to the Company. In addition to the foregoing grant of options, Executive shall
also be entitled to receive stock option grants under the Company's stock option
plan commencing one year after the Effective Date in such amounts and upon such
terms as shall be determined by the Board of Directors, in its sole discretion.

 

4.3         Incentive Compensation. Executive will be eligible to participate in
the Company's annual incentive compensation program (“Incentive Plan”)
applicable to executive employees, as approved by the Board (the year in which
the program is implemented, the “Plan Year”). The target potential amount
payable to Executive under the Incentive Plan, if earned, shall be 30% of
Executive's Base Salary earned during the applicable calendar year. Compensation
under the Incentive Plan (“Incentive Compensation”) will be conditioned on the
satisfaction of individual and Company objectives, as established in writing by
the Company, and the condition that Executive is employed by Company on the
Incentive Compensation payment date, which shall be on or before March 15th of
the year following the Plan Year. The payment of any Incentive Compensation
pursuant to this Section 4.3 shall be made in accordance with the normal payroll
practices of the Company, less required deductions for state and federal
withholding tax, social security and all other employment taxes and authorized
payroll deductions.

 

4.4         Performance Review. The Company will periodically review Executive's
performance on no less than an annual basis and may increase (but not decrease)
Executive's salary or other compensation, as it deems appropriate in its sole
and absolute discretion.

 

4.5         Customary Fringe Benefits. Executive understands and agrees that
certain employee benefits may be provided to the Executive by the Company
incident to the Executive's employment. Executive will be eligible for all
customary and usual fringe benefits generally available to executive employees
and all other employees of the Company subject to the terms and conditions of
the Company's benefit plan documents. Executive understands and agrees that any
employee benefits provided to the Executive by the Company incident to the
Executive's employment (other than Base Salary, Incentive Compensation and any
applicable Severance Payment) are provided solely at the discretion of the
Company and may be modified, suspended or revoked at any time, without notice or
the consent of the Executive, unless otherwise provided by law. Moreover, to the
extent that these benefits are provided pursuant to policies or plan documents
adopted by the Company, Executive acknowledges and agrees that these benefits
shall be governed by the applicable employment policies or plan documents. The
benefits to be provided to Executive shall include group health insurances and
participation in a 401 (k) plan. Executive will be eligible to receive paid time
off benefits in the form of vacation, sick and holidays.

 

4.6         Business Expenses. Executive will be reimbursed for all reasonable,
out-of-pocket business expenses incurred in the performance of Executive's
duties on behalf of the Company, including travel-related expenses. To obtain
reimbursement, expenses must be submitted promptly with appropriate supporting
documentation in accordance with the Company's policies.

 

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5.            Confidentiality and Proprietary Agreement. Executive agrees to
abide by the Company's Employee Proprietary Information and Inventions Agreement
(the “Non-Disclosure Agreement”), which Executive has signed and is incorporated
herein by reference.

 

6.            Termination of Executive’s Employment.

 

6.1         Termination for Cause by the Company. The Company may terminate
Executive’s employment immediately at any time and without notice for “Cause.”
For purposes of this Agreement, "Cause" shall mean (i) a material breach by
Executive of this Agreement or the Non-Disclosure Agreement; (ii) the death of
Executive or his disability resulting in his inability to perform his reasonable
duties assigned hereunder for a period of 180 days; (iii) Executive's theft,
dishonesty, or falsification of any Company documents or records; (iv)
Executive's improper use or disclosure of the Company's confidential or
proprietary information; or (v) Executive's conviction (including any plea of
guilty or nolo contendere) of any criminal act which impairs Executive's ability
to perform his duties hereunder or which in the Board's judgment may materially
damage the business or reputation of the Company; provided, however, that prior
to termination for cause arising under clause (i), Executive shall have a period
of ten days after written notice from the Company to cure the event or grounds
constituting such cause. Any notice of termination provided by Company to
Executive under this Section 6.1 shall identify the events or conduct
constituting the grounds for termination with sufficient specificity so as to
enable Executive to take steps to cure, if curable, the same if such default is
a material breach by Executive of this Agreement of the Non-Disclosure
Agreement. In the event Executive's employment is terminated in accordance with
this subsection 6.1, Executive shall be entitled to receive only the Base Salary
and any earned Incentive Compensation (as defined in Section 4.3 above) then in
effect, prorated to the date of termination. All other obligations of the
Company to Executive pursuant to this Agreement will be automatically terminated
and completely extinguished.

 

6.2         Termination Without Cause By The Company/Separation Package. The
Company may terminate Executive’s employment under this Agreement without Cause
(as defined in Section 6.1 above) at any time on thirty (30) days’ advance
written notice to Executive. In the event of such termination, Executive will
receive Executive’s Base Salary through the date of termination and a prorated
portion of any Incentive Compensation that was earned under Section 4.3 through
the date of termination. Upon such termination without Cause, any then unvested
stock options granted to Executive by the Company will become fully vested and
Executive shall have six months from the date of termination within which to
exercise his vested options. In addition, upon a termination of Executive’s
employment by the Company without Cause, Executive will be eligible to receive a
“Severance Payment” equivalent to six months of Executive’s then Base Salary,
payable in full within thirty (30) days after termination, provided that
Executive first satisfies the Severance Conditions. For purposes of this
Agreement, the “Severance Conditions” are defined as (1) Executive’s execution
and non- revocation of a full general release, in the form attached hereto as
Exhibit A, and such release has become effective in accordance with its terms
prior to the 30th day following the termination date; and (2) Executive’s
reaffirmation of Executive’s commitment to comply, and actual compliance, with
all surviving provisions of this Agreement. Following payment of the Severance
Payment, Base Salary, any Incentive Compensation and any benefits required to be
paid in accordance with applicable benefit plans through the date of
termination, all other obligations of the Company to Executive pursuant to this
Agreement will be automatically terminated and completely extinguished.

 

6.3         Termination Upon a Change of Control. For purposes of this
Agreement, “Change of Control” shall mean: (1) a merger or consolidation or the
sale or exchange by the stockholders of the Company of capital stock of the
Company, where the stockholders of the Company immediately before such
transaction do not obtain or retain, directly or indirectly, at least a majority
of the beneficial interest in the voting stock or other voting equity of the
surviving or acquiring corporation or other surviving or acquiring entity, in
substantially the same proportion as before such transaction; (2) any
transaction or series of related transactions to which the Company is a party in
which in excess of fifty percent (50%) of the Company's voting power is
transferred; or (3) the sale or exchange of all or substantially all of the
Company's assets (other than a sale or transfer to a subsidiary of the Company
as defined in section 424(f) of the Internal Revenue Code of 1986, as amended
(the “Code”)), where the stockholders of the Company immediately before such
sale or exchange do not obtain or retain, directly or indirectly, at least a
majority of the beneficial interest in the voting stock or other voting equity
of the corporation or other entity acquiring the Company's assets, in
substantially the same proportion as before such transaction; provided, however,
that a Change of Control shall not be deemed to have occurred pursuant to any
transaction or series of transactions relating to a public or private financing
or re-financing, the principal purpose of which is to raise money for the
Company's working capital or capital expenditures and which does not result in a
change in a majority of the members of the Board. If, within six (6) months
immediately preceding a Change of Control or within twelve (12) months
immediately following a Change of Control, the Executive's employment is
terminated by the Company for any reason other than Cause, then the Executive
shall be entitled to receive the Severance Payment and stock option vesting and
exercisability set forth in Section 6.2, provided that Executive first satisfies
the Severance Conditions. Following payment of the Severance Payment, Base
Salary, any Incentive Compensation and any benefits required to be paid in
accordance with applicable benefit plans through the date of termination, all
other obligations of the Company to Executive pursuant to this Agreement will be
automatically terminated and completely extinguished.

 

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6.4         Resignation. Executive shall have the right to terminate this
Agreement at any time, for any reason, by providing the Company with thirty (30)
days written notice, provided, however, that subsequent to Executive's
resignation, Executive shall be required to comply with all surviving provisions
of this Agreement. Executive shall not be entitled to any Severance Pay.
Executive will only be entitled to receive Executive's Base Salary earned up to
the date of termination. Notwithstanding the foregoing, Executive has the right
upon thirty (30) days written notice to the Company to terminate Executive's
employment for "Good Reason" due to occurrence of any of the following: (i) a
material adverse change in Executive's title, duties or responsibilities; (ii)
any failure by the Company to pay, or any reduction by Company of, the base
salary or any failure by Company to pay any Incentive Compensation to which
Executive is entitled pursuant to Section 4; (iii) the Company creates a work
environment designed to constructively terminate Executive or to unlawfully
harass or retaliate against Executive; (iv) a Change of Control occurs in which
the Company is not the surviving entity and the surviving entity fails to offer
Executive an executive position at a compensation level at least equal to
Executive's then compensation level under this Agreement; or (v) the Company's
requirement that Executive report for work at a location more than forty-five
(45) miles from his home without the written consent of Executive to such
relocation. In the event that Executive terminates his employment for Good
Reason, then Executive shall be entitled to receive the Base Salary, any earned
Incentive Compensation, Severance Payment and stock option vesting and
exercisability as if Executive were terminated by the Company without Cause
under Section 6.2, subject to Executive's compliance with all of the Severance
Conditions.

 

6.5         Application of Section 409A.

 

6.5(a)        Notwithstanding anything set forth in this Agreement to the
contrary, no amount payable pursuant to this Agreement which constitutes a
“deferral of compensation” within the meaning of the Treasury Regulations issued
pursuant to Section 409A of the Code (the “Section 409A Regulations”) shall be
paid unless and until Executive has incurred a “separation from service” within
the meaning of the Section 409A Regulations.

 

6.5(b)        Company intends that income provided to Executive pursuant to this
Agreement will not be subject to taxation under Section 409A of the Code. The
provisions of this Agreement shall be interpreted and construed in favor of
satisfying any applicable requirements of Section 409A of the Code. However,
Company does not guarantee any particular tax effect for income provided to
Executive pursuant to this Agreement. In any event, except for Company's
responsibility to withhold applicable income and employment taxes from
compensation paid or provided to Executive, Company shall not be responsible for
the payment of any applicable taxes on compensation paid or provided to
Executive pursuant to this Agreement.

 

6.5(c)        Furthermore, to the extent that Executive is a “specified
employee” within the meaning of the Section 409A Regulations as of the date of
Executive’s separation from service, no amount that constitutes a deferral of
compensation which is payable on account of Executive's separation from service
shall be paid to Executive before the date (the “Delayed Payment Date”) which is
first day of the seventh month after the date of Executive's separation from
service or, if earlier, the date of Executive's death following such separation
from service. All such amounts that would, but for this Section, become payable
prior to the Delayed Payment Date will be accumulated and paid on the Delayed
Payment Date.

 

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6.5(d)        Notwithstanding anything herein to the contrary, the reimbursement
of expenses or in-kind benefits provided pursuant to this Agreement shall be
subject to the following conditions: (i) the expenses eligible for reimbursement
or in-kind benefits in one taxable year shall not affect the expenses eligible
for reimbursement or in-kind benefits in any other taxable year; (ii) the
reimbursement of eligible expenses or in-kind benefits shall be made promptly,
subject to Company's applicable policies, but in no event later than the end of
the year after the year in which such expense was incurred; and (iii) the right
to reimbursement or in-kind benefits shall not be subject to liquidation or
exchange for another benefit.

 

6.5(e)           For purposes of Section 409A of the Code, the right to a series
of installment payments under this Agreement shall be treated as a right to a
series of separate payments.

 

7.            General Provisions.

 

7.1         Successors and Assigns. The rights and obligations of the Company
under this Agreement shall inure to the benefit of and shall be binding upon the
successors and assigns of the Company. Executive shall not be entitled to assign
any of Executive’s rights or obligations under this Agreement.

 

7.2         Waiver. Either party's failure to enforce any provision of this
Agreement shall not in any way be construed as a waiver of any such provision,
or prevent that party thereafter from enforcing each and every other provision
of this Agreement.

 

7.3         Attorney’s Fees. In the event of any dispute or claim relating to or
arising out of Executive’s employment relationship with Company, this Agreement,
or the termination of Executive’s employment with Company for any reason, the
prevailing party in any such dispute or claim shall be entitled to recover its
reasonable attorney’s fees and costs.

 

7.4         Severability. In the event any provision of this Agreement is found
to be unenforceable by an arbitrator or court of competent jurisdiction, such
provision shall be deemed modified to the extent necessary to allow
enforceability of the provision as so limited, it being intended that the
parties shall receive the benefit contemplated herein to the fullest extent
permitted by law. If a deemed modification is not satisfactory in the judgment
of such arbitrator or court, the unenforceable provision shall be deemed
deleted, and the validity and enforceability of the remaining provisions shall
not be affected thereby.

 

7.5         Interpretation; Construction. The headings set forth in this
Agreement are for convenience only and shall not be used in interpreting this
Agreement. Executive has participated in the negotiation of the terms of this
Agreement. Furthermore, Executive acknowledges that Executive has had an
opportunity to review and revise the Agreement and have it reviewed by legal
counsel, if desired, and, therefore, the normal rule of construction to the
effect that any ambiguities are to be resolved against the drafting party shall
not be employed in the interpretation of this Agreement.

 

7.6         Governing Law. This Agreement will be governed by and construed in
accordance with the laws of the United States and the internal laws of the State
of California.

 

7.7         Notices. Any notice required or permitted by this Agreement shall be
in writing and shall be delivered as follows with notice deemed given as
indicated: (a) by personal delivery when delivered personally; (b) by overnight
courier upon written verification of receipt; (c) by telecopy, facsimile
transmission, or electronic transmission such as e-mail, upon acknowledgment of
receipt of electronic transmission; or (d) by certified or registered mail,
return receipt requested, upon verification of receipt. Notice shall be sent to
the addresses set forth below each party’s signature, or such other address as
either party may specify in writing.

 

7.8         Entire Agreement. This Agreement constitutes the entire agreement
between the Parties relating to this subject matter and supersedes all prior or
simultaneous representations, discussions, negotiations, and agreements, whether
written or oral. This Agreement may be amended or modified only with the written
consent of Executive and the Company. No oral waiver, amendment or modification
will be effective under any circumstances whatsoever.

 

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[Execution Page Follows]

 

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THE PARTIES TO THIS AGREEMENT HAVE READ THE FOREGOING AGREEMENT AND FULLY
UNDERSTAND EACH AND EVERY PROVISION CONTAINED HEREIN. WHEREFORE, THE PARTIES
HAVE EXECUTED THIS AGREEMENT ON THE DATES SHOWN BELOW.

 

  EXECUTIVE:       /s/ Frederick G. Vogt   Frederick Vogt   West Norriton, PA  
    COMPANY:       Lion Biotechnologies, Inc.       By:   /s/ Maria Fardis      
Maria Fardis   President & Chief Executive Officer   112 W. 34th Street 17th
Floor   New York, NY 10120

 

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Exhibit A

Form of Release and Waiver of Claims

 

In consideration for the severance payments and other benefits provided for in
the Executive Employment Agreement, effective as of September 30, 2016 (the
“Employment Agreement”), I, Frederick Vogt hereby furnish Lion Biotechnologies,
Inc., a Nevada corporation (the “Company”) with the following release and waiver
(the “Release and Waiver”).

 

In exchange for the consideration provided to me by the Employment Agreement, I
hereby generally and completely release the Company and its officers, directors,
employees, agents, attorneys, predecessors, successors, parent and subsidiary
entities, insurers, affiliates, and assigns from any and all claims, liabilities
and obligations, both known and unknown, that arise out of or are in any way
related to events, acts, conduct, or omissions occurring prior to my signing
this Release and Waiver. This general release includes, but is not limited to:
(1) all claims arising out of or in any way related to my employment with the
Company or the termination of that employment; (2) all claims related to my
compensation or benefits from the Company, including, but not limited to,
salary, bonuses, commissions, vacation pay, expense reimbursements, severance
pay, fringe benefits, stock, stock options, or any other ownership interests in
the Company; (3) all claims for breach of contract, wrongful termination, and
breach of the implied covenant of good faith and fair dealing; (4) all tort
claims, including, but not limited to, claims for fraud, defamation, emotional
distress, and discharge in violation of public policy; and (5) all federal,
state, and local statutory claims, including, but not limited to, claims for
discrimination, harassment, retaliation, attorneys’ fees, or other claims
arising under the federal Civil Rights Act of 1964 (as amended), the federal
Americans with Disabilities Act of 1990, and the federal Age Discrimination in
Employment Act of 1967 (as amended) (“ADEA”).

 

I acknowledge that, among other rights, I am waiving and releasing any rights I
may have under ADEA and that this Release and Waiver is knowing and voluntary. I
further acknowledge that I have been advised, as required by the Older Workers
Benefit Protection Act, that: (a) the release and waiver granted herein does not
relate to claims under the ADEA which may arise after this Release and Waiver is
executed; (b) I should consult with an attorney prior to executing this Release
and Waiver; (c) I have 21 days in which to consider this Release and Waiver
(although I may choose voluntarily to execute this Release and Waiver earlier);
(d) I have seven days following the execution of this Release and Waiver to
revoke my consent to this Release and Waiver; and (e) this Release and Waiver
shall not be effective until the eighth day after I execute this Release and
Waiver and the revocation period has expired. Notwithstanding the foregoing,
nothing contained in this Release and Waiver shall waive, release or otherwise
diminish any claims that I might have at law or in equity for payment of
severance or other benefits to which I am entitled under the terms of the
Employment Agreement.

 

I acknowledge my continuing obligations under my Employee Proprietary
Information and Inventions Agreement between myself and the Company (the
“Confidentiality Agreement”). I understand and agree that my right to the
severance pay I am receiving is in exchange for my agreement to the terms of
this Release and Waiver and is contingent upon my continued compliance with my
Confidentiality Agreement.

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This Release and Waiver, including the Confidentiality Agreement, and the
Employment Agreement constitute the complete, final and exclusive embodiment of
the entire agreement between the Company and me with regard to the subject
matter hereof. I am not relying on any promise or representation by the Company
that is not expressly stated herein. This Release and Waiver may only be
modified by a writing signed by both me and a duly authorized officer of the
Company.

 

    Frederick Vogt       Dated: ____________  

 

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