Exhibit 10.13

 

PRO-PHARMACEUTICALS, INC.

 

EMPLOYMENT AGREEMENT

(David Platt)

 

EMPLOYMENT AGREEMENT, made this 2nd day of January, 2004 (the “Effective Date”),
between Pro-Pharmaceuticals, Inc., a Nevada corporation having an address of 189
Wells Avenue, Newton, Massachusetts 02459 (the “Company”), and David Platt, an
individual residing at 12 Appleton Circle, Newton, Massachusetts 02459 (the
“Executive”).

 

WHEREAS, the Executive is a founder of the Company and of its predecessor
Massachusetts corporation of the same name and has been an employee of or
otherwise engaged by the Company and its predecessor since the founding date of
such Massachusetts corporation continuously until the Effective Date (such
period of prior employment or engagement herein referred to as the “Prior
Engagement”);

 

WHEREAS, the Company recognizes that the Executive’s talents and abilities are
unique, and have been and will be integral to the success of the Company and
thus the Company desires to secure the ongoing services of the Executive, on the
terms and conditions set forth in this Agreement;

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained in this Agreement, the parties agree as follows:

 

1. Employment.

 

(a) The Company shall employ the Executive, and Executive agrees to be so
employed, in the capacity of President and Chief Executive Officer of the
Company. In such capacity, the Executive will have overall responsibility for
the management of the Company. All employees will report directly to the
Executive or his designee and the Executive will report directly to the Board of
Directors of the Company (the “Board”). The Executive shall have the authority
as Chief Executive Officer and President of the Company for all Company
operational and strategic matters, subject to the general oversight of the
Board. The Executive will render such business and professional services in the
performance of his duties consistent with his position within the Company, as
shall be assigned to the Executive by the Board.

 

(b) Executive’s services shall be performed in the Company’s Newton,
Massachusetts offices, subject to such business travel as may be required from
time to time.

 

(c) Executive shall serve as Chairman of the Board of Directors of the Company,
subject to any required Board and/or shareholder approval.

 

2. Term of Agreement. This Agreement shall continue in full force and effect for
the duration of Executive’s employment with the Company, except as this
Agreement may be amended or superceded by written agreement of the parties
hereto.

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3. Salary; Expenses; Bonus.

 

(a) Base Salary. The Executive’s base salary for the period commencing on the
date hereof will be not less than two hundred twenty thousand dollars ($220,000)
per year payable on the Company’s regular payroll dates, less required
withholdings. The Executive’s base salary shall be reviewed at least annually
and is subject to merit increases in connection therewith. Such salary as in
effect from time to time is herein referred to as the “Base Salary”.

 

(b) Bonus. The Executive shall be eligible for the following bonus compensation:

 

(i) Strategic Relationship. Upon consummation of a transaction with a
pharmaceutical company expected to result in at least $10,000,000 of equity
investment or $50,000,000 of royalty revenue to the Company or providing in the
Board’s determination some other substantial benefit to the Company, (A) a cash
bonus of at least $200,000, payable as the Board may determine, but not later
than three (3) months after such consummation (a “Cash Bonus”), and (B) fully
vested stock options to purchase at least 200,000 shares of the common stock of
the Company (“Common Stock”) exercisable for ten (10) years at a purchase price
not less than the fair market value of the Common Stock determined in good faith
by the Board as of the date of grant (“Stock Options”).

 

(ii) IND. Upon approval by the Food and Drug Administration (“FDA”) of each
investigational new drug application (“IND”) of the Company for commencement of
human clinical trials, (A) a Cash Bonus of at least $100,000 and (B) fully
vested Stock Options to purchase at least 100,000 shares of the Common Stock;

 

(iii) NDA. Upon approval by the FDA of each new drug application (“NDA”) for any
drug or drug delivery candidate of the Company, (A) a Cash Bonus of at least
$400,000 and (B) fully vested Stock Options to purchase at least 400,000 shares
of the Common Stock; and

 

(iv) Annual Management Bonus. The Executive shall be eligible to receive a Cash
Bonus upon achievement of reasonable goals specified by the Board. Such goals
shall be set forth in writing by the Board prior to the close of the first
quarter of each fiscal year of the Company with fifty percent (50%) of such
goals to be dependent of Executive’s individual performance as an executive
manager and/or scientist with respect to Subject Ideas and Inventions (as
defined below) and fifty percent (50%) of such goals to be dependent on the
Company’s performance determined by reference to objective criteria such as the
market price of the Common Stock or meeting budgets approved by the Board.

 

All of such bonus compensation shall be payable or issuable to Executive so long
as his business relationship is continuing at the time that the event triggering
his right to such bonus compensation shall occur. At the discretion of the
Board, while the Company is a “development stage company” as stated in its
audited financial reports, the Company, in order to conserve its working
capital, may elect to pay any cash bonus in equal installments of principal over
a term not to exceed twenty-four months bearing interest not in excess of the
prime rate stated in the Wall Street Journal as of the date of the grant of such
bonus, such obligation to be evidenced by a promissory note reasonably
satisfactory to the Executive.

 

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(c) Automobile. The Company shall provide Executive with an automobile,
consistent with the practices of the Company immediately prior to the Effective
Date.

 

(d) Reimbursement of Expenses. The Company shall reimburse the Executive for all
reasonable and appropriate or necessary out-of-pocket expenses incurred in
connection with the Executive’s carrying out the Executive’s duties under this
Agreement, in conformity with such procedures as the Company may establish from
time to time. In addition, the Company will reimburse Executive for reasonable
legal fees and disbursements incurred in connection with the negotiation,
preparation and execution of this Agreement, up to a maximum amount of $10,000.

 

(e) Vacation. The Executive shall be entitled to six (6) weeks of vacation per
year. Vacation not taken during the applicable fiscal year (but not in excess of
three weeks) shall be carried over to the next following fiscal year.

 

4. Benefits. The Executive will be entitled to life, disability and health
insurance, vacation and other benefits commensurate with the Executive’s
position in accordance with the Company’s standard employee benefits policies as
in effect from time to time. The Executive has received a summary of the
Company’s employee benefits as in effect as of the date hereof.

 

To the extent the Company obtains insurance with respect to (i) directors’ and
officers’ liability, (ii) errors and omissions and (iii) general liability
insurance, the Executive shall be covered by such insurance to the same extent
as other senior executives and directors of the Company.

 

The Company reserves the right to cancel or change the benefit plan and programs
it offers to its Executive at any time, provided that the Company shall not
cancel or reduce the benefits offered Executive under this Agreement.

 

5. Compliance with Company Policy. During this agreement, the Executive shall
observe all Company rules and policies, including such policies as are contained
in the Company policy and procedures manual as from time to time amended. The
Executive has received a copy of the Company’s policy and procedures manual as
in effect as of the date hereof.

 

6. Conflicting Employment. Executive may serve on corporate, civic, charitable
boards, and engage in any other activities provided that such activities do not
interfere or conflict with the performance of Executive’s duties or obligations
under this Agreement.

 

7. Termination of Employment.

 

(a) Death. If Executive’s employment is terminated by reason of his death, the
Executive’s estate shall be entitled to prompt payment for the Base Salary
pro-rated through the event of death and a pro-rated bonus payment, based on the
highest bonus amount paid to the Executive in any prior year. For a period of
two (2) years after the event of death, the Executive’s spouse and eligible
dependents shall be eligible for continued participation in the benefits to
which the Executive and his eligible spouse and dependents were entitled
pursuant to Section 4 hereof while the Executive was employed by the Company,
and if the Company cannot include Executive’s family in any health plan
subsequent to the termination of his employment,

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Company shall provide Executive’s family, for not less than three (3) years
following the effective date of his termination of employment, funding
sufficient to obtain private health insurance coverage for Executive’s family
that is substantially equal to the benefits available under the Company’s health
insurance policy as in effect at the date of Executive’s death.

 

(b) Disability. If, as a result of the Executive incapacity due to physical or
mental illness as determined by a physician selected by the Executive, and
reasonably acceptable to the Board, the Executive shall have been substantially
unable to perform his duties hereunder for 90 days within any 180–day period,
the Company shall have the right to terminate the Executive’s employment
hereunder for “disability”. If Executive’s employment is terminated by reason of
his disability, the Executive shall be entitled to prompt payment for the Base
Salary pro-rated through the termination date and a pro-rated bonus payment,
based on the highest bonus paid to the Executive in any prior year. The Company
shall also provide the Executive with the excess, if any, of his full Base
Salary over the amount of any long-term disability benefits that he receives
through the Company plans for a period of two years, payable in accordance with
the normal payroll practices of the Company. In addition, for a period of three
(3) years after the date of termination, the Executive and the Executive’s
spouse and eligible dependents shall be eligible for continued participation in
the benefits to which the Executive and his eligible spouse and dependents were
entitled pursuant to Section 4 hereof while the Executive was employed by the
Company, and if the Company cannot include Executive in any health plan
subsequent to the termination of his employment, Company shall provide
Executive, for not less than three (3) years following the effective date of his
termination of employment, funding sufficient to obtain private health insurance
coverage for Executive and his family that is substantially equal to the
benefits available under the Company’s health insurance policy as in effect at
the date of Executive’s termination.

 

(c) For Cause. The Company shall have the right, upon written notice thereof to
the Executive, to terminate the Executive’s employment hereunder if

 

(i) the Executive

 

(A) in the determination of the Board by a vote of two-thirds of its members has
engaged in gross negligence or willful gross misconduct in the performance of
the Executive’s duties hereunder and such conduct results in material and
quantifiable damage to the Company;

 

(B) is convicted of a felony or other violation which in the reasonable judgment
of by the Board could materially impair the Company from substantially meeting
its business objectives; or

 

(C) is found by the primary auditor of the Company or other auditor engaged by
the Audit Committee of the Board to have committed any act of fraud,
misappropriation of funds or embezzlement with respect to the Company; and

 

(ii) except as to the matters referred to in clauses (B) or (C), within ninety
(90) days (the “Cure Period”) after delivery of written notice from the Board
stating with specificity the nature of the reason for an anticipated for-cause
termination, the Executive fails to cure, or if the matter is not curable within
the Cure Period the Executive fails, in the judgment of the Board, within the
Cure Period to undertake diligently to cure such failure, refusal or negligence.

 

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In the event of termination pursuant to this Section 7(c), the Executive shall
be entitled to the payments and benefits set forth in Sections 3 and 4 hereof
through the end of the Cure Period.

 

(d) For Good Reason. The Executive may terminate his employment for “Good
Reason” after giving the Company detailed written notice of his intention to
terminate for Good Reason, if the Company shall have failed to cure the event or
circumstance constituting “Good Reason” within twenty (20) business days after
receiving such notice (which 20-day period may be extended by written consent of
the parties). Good Reason shall mean the occurrence of any of the following
without the written consent of the Executive or his approval in his capacity as
the Chairman of the Board (which approval may be evidenced by written consent of
the Board or minutes of a meeting at which the Executive was present and voted
in favor of such minutes):

 

(i) the assignment to the Executive of duties inconsistent with this Agreement
or a change in his titles or authority;

 

(ii) any failure of the Company to comply with subsections (a) or (b) of Section
3 hereof in any material way;

 

(iii) a relocation of Executive’s principal office to a location more than
twenty-five (25) miles from 189 Wells Avenue, Newton, Massachusetts;

 

(iv) the Company changes its line of business such that it is no longer
principally engaged in activities related to development, manufacture, licensing
or related commercialization of technology or drugs using carbohydrate chemistry
to improve the efficacy and reduce the toxicity of drugs;

 

(v) any material breach of this Agreement by the Company; or

 

(vi) any failure by the Company to obtain the assumption of this Agreement by
any successor or assign of the Company.

 

(e) Without Cause. In the event the employment of the Executive is terminated by
the Company for any reason other than as stated in Section 7(a)-7(c), any such
termination will be deemed for the purposes hereof to be “without cause”;
provided, however, that voluntary resignation by the Executive for reasons other
than Good Reason shall not constitute an event that entitles him to the
severance set forth in subsection (f) below.

 

(f) Effect of Termination by Company Without Cause, or by Executive for Good
Reason or After Change of Control. If the Executive’s employment is terminated
by the Company without cause or by Executive for Good Reason or, in the event of
any Change in Control, the Executive’s employment is terminated for any reason
within twelve (12) months after such Change in Control (as hereinafter defined),

 

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(i) the Executive shall be paid a lump sum equal to the sum of his Base Salary
and accrued vacation pay through the effective date of such termination;

 

(ii) the Executive shall be paid (in accordance with the Company’s customary
payroll practices for senior management) the Executive’s Base Salary for two (2)
years after the effective date of such termination;

 

(iii) the Executive shall be paid the higher of $1,000,000, or three times the
highest bonus amount paid to Executive during any prior fiscal year, such amount
paid pursuant to this clause (iii) not to exceed $2,000,000;

 

(iv) the Executive shall be reimbursed for all expenses pursuant to Section 3
incurred through such effective date;

 

(v) the Executive shall continue to have during such post-employment period, to
the extent permitted by law, the benefits to which the Executive and his
eligible spouse and dependents were entitled pursuant to Section 4 hereof while
the Executive was employed by the Company, and if the Company cannot include
Executive and his family in any health plan subsequent to the termination of his
employment, Company shall provide Executive, for not less than two (2) years
following the effective date of his termination of employment, funding
sufficient to obtain private health insurance coverage for himself and his
family that is substantially equal to the benefits available under the Company’s
health insurance policy as in effect at the date of Executive’s termination;

 

(vi) the Company shall provide at its expense a fully furnished office suitable
for professionals for Executive’s exclusive use during such two-year
post-employment period at a location not more than five (5) miles from the
Executive’s residence;

 

(vii) the Company shall provide the automobile provided to the Executive prior
to the effective date of the termination during such two-year post-employment
period;

 

(viii) to the extent shares of the capital stock of the Company held by
Executive are subject to repurchase rights by the Company, such right of
repurchase will immediately be extinguished and Executive shall hold such shares
free of any right by the Company to repurchase them; and

 

(ix) any option or other right to acquire securities of the Company, to the
extent not fully vested, shall accelerate so that such option or other rights
are immediately exercisable upon Executive’s termination.

 

For purposes of this Agreement, a Change of Control means the occurrence of any
the following in connection with which the Executive has not in his sole
discretion consented in writing to waive any or all of the severance provisions
stated in subsection (f) above: (i) any sale, merger, consolidation, tender
offer or similar acquisition of shares, or other transaction or series of
related transactions (each a “Transaction”), other than any Transaction the
substantial purpose of which in the reasonable determination of the Board is
equity or debt finance of the Company, as a result of which at least a majority
of the voting power of the Company is not held,

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directly or indirectly, by the persons or entities who held the Company’s
securities with voting power before such Transaction (provided, however, that
any person who acquired voting securities of the Company in contemplation of the
Transaction and who immediately after such Transaction possesses direct or
indirect ownership of at least ten percent (10%) of the securities of the
Company or the surviving entity (or if the Company or the surviving entity is a
controlled affiliate of another entity, then of such controlling entity) shall
not be included in the group of those persons or entities who held the Company’s
securities with voting power before such Transaction); (ii) a sale or other
disposition of all or a substantial part of the Company’s assets, whether in one
transaction or a series of related transactions; or (iii) individuals who on the
Effective Date constitute the Board and together with any individual who becomes
a director after such date (other than a director designated by a person or
entity who has entered into an agreement to effect a transaction described in
clause (i) or (ii) above) whose nomination and/or election to the Board was
approved by a vote of at least a majority of the directors then still in office
who either were members of the Board on the Effective Date or whose election or
nomination for election after the Effective Date was previously so approved,
cease for any reason to constitute a majority of the Board.

 

(g) Gross-Up Payment for Golden Parachute Taxes. If it is determined that any
payment by the Company to or for the benefit of Executive, under the employment
agreement or otherwise, would be subject to the federal excise taxes imposed on
golden parachute payments, the Company will make an additional payment to
Executive (the “Gross-Up Payment”) in an amount sufficient to cover (a) any
golden parachute excise tax payable by Executive, (b) all taxes on the Gross-Up
Payment, and (c) all interest and/or penalties imposed with respect to such
taxes.

 

(h) Survival of Obligations. The obligations of the Company and the Executive
set forth in Section 3(b) (reimbursement of expenses), in this Section 7,
Section 8 (indemnification), Section 9 (confidentiality), Section 10 (assignment
of inventions), Section 11 (return of property), Section 12 (non-solicitation),
Section 13 (scientific collaboration), Section 14 (non-competition), and Section
15 (publications) will survive the termination of Executive’s employment
hereunder, whether with or without cause or for Good Reason.

 

8. Indemnification.

 

(a) The Company agrees that if the Executive is made a party, or is threatened
to be made a party, to any action, suit or proceeding, whether civil, criminal,
administrative or investigative (a “Proceeding”), by reason of the fact that he
is or was a director, officer or employee of the Company or is or was serving at
the request of the Company as a director, officer, member, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
including service with respect to employee benefit plans, whether or not the
basis of such Proceeding is the Executive’s alleged action in an official
capacity while serving as a director, officer, member, employee or agent, the
Executive shall be indemnified and held harmless by the Company to the fullest
extent legally permitted or authorized by the Company’s certificate of
incorporation or bylaws or resolutions of the Board or, if greater, by the laws
of The Commonwealth of Massachusetts, against all cost, expense, liability and
loss (including, without limitation, reasonable attorneys’ fees and
disbursements, judgments, fines, ERISA excise taxes or other liabilities or
penalties and amounts paid or to be paid in settlement) reasonably incurred or

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suffered by the Executive in connection therewith, and such indemnification
shall continue as to the Executive even if he has ceased to be a director,
member, employee or agent of the Company or other entity, with respect to acts
or omissions which occurred prior to his cessation of employment with the
Company, and shall inure to the benefit of the Executive’s heirs, executors and
administrators. The Company shall advance to the Executive all reasonable costs
and expenses incurred by him in connection with a Proceeding within 20 business
days after receipt by the Company of a written request for such advance. Such
request shall include an undertaking by the Executive to repay the amount of
such advance if it shall ultimately be determined that he is not entitled to be
indemnified against such costs and expenses.

 

(b) Neither the failure of the Company (including its Board, independent legal
counsel or stockholders) to have made a determination prior to the commencement
of any Proceeding concerning payment of amounts claimed by the Executive under
Section 8(a) above that indemnification of the Executive is proper because he
has met the applicable standard of conduct, nor a determination by the Company
(including its board of directors, independent legal counsel or stockholders)
that the Executive has not met such applicable standard of conduct, shall create
a presumption that the Executive has not met the applicable standard of conduct.

 

(c) The Company agrees to continue and maintain a directors’ and officers’
liability insurance policy covering the Executive to the extent the Company
provides such coverage for its other executive officers.

 

9. Confidential Information.

 

(a) Company Information. The Executive agrees at all times during the term of
the Executive’s employment or other involvement with the Company and thereafter
for ten (10) years to hold in strictest confidence, and not to use, except for
the benefit of the Company, or to disclose to, or permit the use by, any person,
firm or corporation without written authorization of the Board, any Confidential
Information of the Company. The Executive understands that “Confidential
Information” means any Company proprietary information, technical data, trade
secrets or know-how or other business information disclosed to the Executive by
the Company, including information acquired during or prior to the Executive’s
Prior Engagement and disclosed to Executive, either directly or indirectly in
writing, orally or by drawings or inspection of parts or equipment, including,
but not limited to:

 

(i) medical and drug research and testing results and information, research and
development techniques, processes, methods, formulas, trade secrets, patents,
patent applications, computer programs, software, electronic codes, mask works,
inventions, machines, innovations, ideas, designs, creations, writings, books
and other works of authorship, discoveries, improvements, data, formats,
projects and research projects;

 

(ii) information about costs, profits, markets, sales, contracts and lists of
customers, and distributors, business, marketing, and strategic plans;
forecasts, unpublished financial information, budgets, projections, and customer
identities, characteristics and agreements as well as all business
opportunities, conceived, designed, devised, developed, perfected or made by the
Executive, whether alone or in conjunction with others, and related in any
manner to the business of the Company; and

 

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(iii) employee personnel files and compensation information.

 

The Executive further understands that Confidential Information does not include
any of the foregoing items which (A) has become publicly known or made generally
available to the public through no wrongful act of the Executive, (B) has been
disclosed to the Executive by a third party having no duty to keep Company
matters confidential, (C) has been developed by the Executive independently of
employment by the Company, (D) has been disclosed by the Company to a third
party without restrictions on disclosure, or (E) has been disclosed with the
Company’s written consent. The Executive further agrees that all Confidential
Information shall at all times remain the property of the Company.

 

(b) Third Party and Former Employer Information. The Executive agrees that the
Executive will not improperly use or disclose any proprietary information or
trade secrets of any former employer or other person or entity with which the
Executive has an agreement or duty to keep in confidence information acquired by
the Executive and that the Executive will not bring onto the premises of the
Company any unpublished document or proprietary information belonging to any
such employer, person or entity unless consented to in writing by such employer,
person or entity.

 

(c) Future Third Party Confidential Information. The Executive recognizes that
the Company has received and in the future will receive from third parties their
confidential or proprietary information subject to a duty on the Company’s part
to maintain the confidentiality of such information and to use it only for
certain limited purposes. The Executive agrees to hold all such confidential or
proprietary information in the strictest confidence and not to disclose it to
any person, firm or corporation or to use it except as necessary in carrying out
the Executive’s work for the Company consistent with the Company’s agreement
with such third party.

 

(d) Prior Actions and Knowledge. The Executive represents and warrants that from
the time of the Executive’s first contact with the Company the Executive has
held in strict confidence all Confidential Information and has not disclosed any
Confidential Information, directly or indirectly, to anyone outside the Company,
or used, copied, published, or summarized any Confidential Information, except
to the extent otherwise permitted in this Agreement.

 

10. Inventions.

 

(a) Inventions Retained and Licensed. Attached hereto, as Exhibit A, is a list
describing all ideas, processes, trademarks, service marks, inventions, designs,
technologies, computer hardware or software, original works of authorship,
formulas, discoveries, patents, copyrights, copyrightable works, products,
marketing and business ideas, and all improvements, know-how, data, rights, and
claims related to the foregoing, whether or not patentable, registrable or
copyrightable, which were conceived, developed or created by the Executive prior
to the Executive’s employment or first contact with the Company (collectively
referred to as “Prior Inventions”), (A) which belong to the Executive, (B) which
may relate to the Company’s current or contemplated business, products or
research and development, and (C) which are not assigned to the Company
hereunder. If there is no Exhibit A or no items thereon, the Executive
represents that there are no such Prior Inventions. If in the course of the
Executive’s employment with the

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Company, the Executive incorporates or embodies into a Company product, service
or process a Prior Invention owned by the Executive or in which the Executive
has an interest, the Company is hereby granted and shall have a nonexclusive,
royalty-free, irrevocable, perpetual, worldwide license to make, have made,
modify, use and sell such Prior Invention as part of or in connection with such
product, service or process.

 

(b) Assignment of Subject Ideas and Inventions. All right, title and interest in
and to all Subject Ideas and Inventions, including but not limited to all
registrable and patent rights which may subsist therein, shall be held and owned
solely by the Company, and where applicable, all Subject Ideas and Inventions
shall be considered works made for hire. The Executive shall take all actions
deemed necessary by the Company to protect the Company’s rights therein. In the
event that the Subject Ideas and Inventions shall be deemed not to constitute
works made for hire, or in the event that the Executive should otherwise, by
operation of law, be deemed to retain any rights (whether moral rights or
otherwise) to any Subject Ideas and Inventions, the Executive shall assign to
the Company, without further consideration, his entire right, title and interest
in and to each and every such Subject Idea and Invention. For purposes of this
Agreement, the term “Subject Ideas and Inventions” includes any and all ideas,
processes, trademarks, service marks, inventions, designs, technologies,
computer hardware or software, original works of authorship, formulas,
discoveries, patents, patent applications, copyrights, copyrightable works,
products, marketing and business ideas, to the extent that any of the same would
be Competing Products (as defined below) if owned by any third person or
organization, and all improvements, know-how, data, rights, and claims related
to the foregoing, whether or not patentable, registrable or copyrightable, which
the Executive may, during the Prior Engagement, on or after the Effective Date
until the date of the termination of employment hereunder and for the period in
which the Company pays any Base Salary in connection with a termination
described in Section 7 hereof, solely or jointly with others conceive or develop
or reduce to practice, or cause to be conceived or developed or reduced to
practice, during the period of time the Executive is in the employ of the
Company, to the extent that any of the same would be Competing Products if owned
by any third person or organization. Notwithstanding the foregoing, nothing in
this paragraph shall assign, or offer to assign, any of Executive’s rights in
any invention developed entirely by Executive on his own time without using the
Company’s equipment, supplies, facilities, or trade secret information.

 

(c) Maintenance of Records. The Executive agrees to keep and maintain adequate
and current written records of all Subject Ideas and Inventions made by the
Executive (solely or jointly with others) during the term of the Executive
employment with the Company. The records will be in the form of notes, sketches,
drawings, and any other format that may be specified by the Company. The records
will be available to, and remain the sole property of, the Company at all times.

 

(d) Disclosures. During the term of his employment, Executive shall disclose
(such disclosure to be received in confidence) all information and records
pertaining to any and all ideas, processes, trademarks, service marks,
inventions, designs, technologies, computer hardware or software, original works
of authorship, formulas, discoveries, patents, patent applications, copyrights,
copyrightable works, products, marketing and business ideas (“Intellectual
Property Items”) that Executive believes are not Subject Ideas and Inventions,
but that Executive has conceived, developed, or reduced to practice during the
term of his

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employment. If, after examination of the information, the Company has a good
faith belief that the Intellectual Property Items are Subject Ideas and
Inventions, the Company shall have the right to ask the Company’s Scientific
Advisory Board to make a determination as to whether the Intellectual Property
Items are Subject Ideas and Inventions. If the Scientific Advisory Board
determines that the Intellectual Property Items are Subject Ideas and
Inventions, the Executive shall have the right to refer the dispute to an
outside arbitrator with suitable scientific expertise, with such arbitrator’s
decision to be binding on both parties. If the parties cannot agree on an
arbitrator, each party shall select one arbitrator who will select a third-party
arbitrator to make the determination.

 

(e) Patent and Copyright Registrations. The Executive agrees to assist the
Company, or its designee, at the Company’s expense, in every proper way to
secure the Company’s rights in the Subject Ideas or Inventions and any
copyrights, patents, mask work rights or other intellectual property rights
relating thereto in any and all countries, including the disclosure to the
Company of all pertinent information and data with respect thereto and the
execution of all applications, specifications, oaths, assignments and all other
instruments which the Company shall deem necessary in order to apply for and
obtain such rights and in order to assign and convey to the Company, its
successors, assigns and nominees the sole and exclusive rights, title and
interest in and to such Subject Ideas and Inventions, and any copyrights,
patents, mask work rights or other intellectual property rights relating
thereto.

 

(f) Right of Reversion. At Executive’s reasonable discretion, the Executive with
written notice identifying the invention may require the Company to assign all
rights, title and interest in and to any invention within the Subject Ideas and
Inventions back to Executive at any time after three (3) years after date of the
assignment to the Company if the Company fails to exploit such invention. For
purposes of this paragraph, Company shall be deemed to have exploited an
invention if Company files, or in the reasonable determination of the Board has
undertaken substantial effort to file, an investigational new drug application
(“IND”) using such invention or if it enters into a strategic relationship with
another entity that depends on such invention.

 

(g) No Use of Name. The Executive shall not at any time use the Company’s name
or any of the Company trademark(s), service mark(s) or trade name(s) in any
advertising or publicity without the prior written consent of the Company.

 

11. Return of Company Property. The Executive agrees that, at any time upon
request of the Company, and in any event at the time of leaving the employ of
the Company, the Executive will deliver to the Company (and will not keep in the
Executive’s possession or deliver to anyone else) any and all devices, records,
data, notes, reports, proposals, lists, correspondence, specifications,
drawings, blueprints, sketches, materials, equipment, other documents or
property, or reproductions of any of the aforementioned items, containing
Confidential Information or otherwise belonging to the Company, its successors
or assigns, whether prepared by the Executive or supplied to the Executive by
the Company.

 

12. Non-Solicitation. The Executive agrees that the Executive shall not during
the Executive’s employment or other involvement with the Company and for a
period of twelve (12) months immediately following the termination of the
Executive for any reason, or for such longer period, if applicable, during which
the Company pays Base Salary pursuant to Section 7(f)(ii) in

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connection with employment termination described in Section 7(f), (i) either
directly or indirectly solicit or take away, or attempt to solicit or take away
employees of the Company, either for the Executive’s own business or for any
other person or entity, or (ii) either directly or indirectly recruit, solicit
or otherwise induce or influence any proprietor, partner, stockholder, lender,
director, officer, employee, sales agent, joint venturer, investor, lessor,
supplier, customer, agent, representative or any other person which has a
business relationship with the Company to discontinue, reduce or modify such
employment, agency or business relationship with the Company.

 

13. Scientific Collaboration. Nothing in this Agreement shall prohibit Executive
from collaborating with Anatole A. Klyosov, Maureen Foley or Eliezer Zomer
regarding scientific research as long as such collaboration does not relate to
Competing Products, whether or not Executive is currently employed by the
Company, provided such collaboration is off-site of any Company premises and
outside normal business hours. Company further agrees that, in consideration of
the promises of Executive set forth in paragraph 12, it will not in any way
limit the rights of Anatole A. Klyosov, Maureen Foley or Eliezer Zomer to
collaborate or otherwise engage in scientific research with Executive should
Executive leave or be terminated by the Company for any reason, so long as such
collaboration or research does not relate to Competing Products and is off-site
of any Company premises and outside normal business hours.

 

14. Covenants Against Competition.

 

(a) Definitions. For the purposes of this Section:

 

(i) “Competing Product” means any product, process, or service of any

person or organization other than the Company, in existence or under
development, which to a significant degree directly competes with the Company’s
current or contemplated business or activities or the Company’s actual or
demonstratably anticipated research or development involving carbohydrate
compounds enabling targeted drug delivery.

 

(ii) “Competing Organization” means any person or organization, including the
Executive, engaged in, or about to become engaged in, research on or the
acquisition, development, production, distribution, marketing, or providing of a
Competing Product.

 

(b) Non-Competition. As a material inducement to the Company to employ or
continue the employment of the Executive, and in order to protect the Company’s
Confidential Information and good will, the Executive agrees to the following
stipulations:

 

(i) For (A) a period of six (6) months after termination of the Executive’s
employment with the Company by the Company with cause or (B) for the period
during which the Company pays post-employment Base Salary pursuant to Section
7(f)(ii) in connection with employment termination described by Section 7(f),
the Executive will not directly or indirectly solicit or divert or accept
business relating in any manner to Competing Products or to products, processes
or services of the Company, from any of the customers or accounts of the Company
with which the Executive had any contact as a result of the Executive’s
employment.

 

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(ii) For (A) a period of six (6) months after termination of the Executive’s
employment with the Company by the Company with cause or (B) for the period
during which the Company pays post-employment Base Salary pursuant to Section
7(f)(ii) in connection with employment termination described by Section 7(f),
the Executive will not (A) render services directly or indirectly, as an
employee, consultant or otherwise, to any Competing Organization in connection
with research on or the acquisition, development, production, distribution,
marketing or providing of any Competing Product, or (B) own any interest in any
Competing Organization other than up to one percent of the outstanding
securities that are not “restricted securities” (as defined in Rule 144 under
the Securities Act of 1933) of an publicly-traded Competing Organization.

 

(c) Modification of Restrictions. The Executive agrees that the restrictions set
forth in this Section are fair and reasonable and are reasonably required for
the protection of the interests of the Company. However, should an arbitrator or
court nonetheless determine at a later date that such restrictions are
unreasonable in light of the circumstances as they then exist, then the
Executive agrees that this Section shall be construed in such a manner as to
impose on the Executive such restrictions as may then be reasonable and
sufficient to assure Company of the intended benefits of this Section.

 

15. Publications. The Executive agrees that the Executive will not less than
twenty (20) business days in advance of submission of information related to
carbohydrate chemistry for publication provide the Company with copies of all
writings and materials which the Executive proposes to publish during the term
of the Executive’s employment and for two years thereafter. The Executive also
agrees that the Executive will, at the Company’s request, cause to be deleted
from such writings and materials any information disclosing Confidential
Information. The Company’s good faith judgment in these matters will be final.
At the Company’s sole discretion, the Executive will also, at the Company’s
request, cause to be deleted any reference whatsoever to the Company from such
writings and materials.

 

16. Equitable Remedies. The Executive agrees that it would be impossible or
inadequate to measure and calculate the Company’s damages from any breach of the
covenants set forth in Sections 9, 10, 11, 12 and 14 herein. Accordingly, at the
sole discretion of the Company, the Executive agrees that if the Executive
breaches any of such Sections, the Company will have, in addition to any other
right or remedy available, the right to obtain an injunction from a court of
competent jurisdiction restraining such breach or threatened breach and to
specific performance of any such provision of this Agreement and, if it prevails
in such a proceeding, the right to recover from the Executive the costs and
expenses thereof, including reasonable attorneys’ fees.

 

17. Representations and Warranties of Executive. The Executive represents and
warrants as follows: (i) that the Executive has no obligations, legal or
otherwise, inconsistent with the terms of this Agreement or with the Executive’s
undertaking a relationship with the Company; and (ii) that the Executive has not
entered into, nor will the Executive enter into, any agreement (whether oral or
written) in conflict with this Agreement.

 

--------------------------------------------------------------------------------

18. Miscellaneous.

 

(a) Entire Agreement. This Agreement contains the entire understanding of the
parties with respect to the subject matter. It may not be changed orally but
only by an agreement in writing signed by the party against whom enforcement of
any waiver, change, modification, extension or discharge is sought.

 

(b) No Waiver. The failure of either party to require strict compliance with the
terms of this agreement in any instance or instances will not be deemed a waiver
of any such term of this Agreement or of that party’s right to require strict
compliance with the terms of this Agreement in any other instance.

 

(c) Successors and Assigns. This Agreement shall be binding on and inure to the
benefit of the successors in interest of the parties, including, in the case of
the Executive, the Executive’s heirs, executors and estate. The Executive may
not assign the Executive’s obligations under this Agreement. The Company may not
assign its obligations under this Agreement, except with the prior written
consent of the Executive.

 

(d) Notices. Any notices or other communications provided for hereunder may be
made by telecopier, first class mail or express courier services provided that
the same are addressed to the party required to be notified at its address first
written above, or such other address as may hereafter be established for
notices, and any notices or other communications sent by first class mail shall
be considered to have been made when posted. The parties telecopier numbers are
as follows: Company - (617) 928-3450; Executive - (617) 928-3450.

 

(e) Severability. If any term or condition of this Agreement shall be invalid or
unenforceable to any extent or in any application, then the remainder of this
Agreement, and such term or condition except to such extent or in such
application, shall not be affected thereby, and each and every term and
condition of this Agreement shall be valid and enforceable to the fullest extent
and in the broadest application permitted by law.

 

(f) Captions; Interpretation. Captions of sections herein are for convenience
only and are not intended to cover all matters therein. Any pronoun or other
gender-linked term shall in each case refer, as applicable, to the masculine,
feminine or neuter. Any defined term shall include its singular or plural form
or other part of speech.

 

(g) Governing Law. This Agreement shall be construed and enforced in accordance
with the laws of The Commonwealth of Massachusetts without giving effect to its
principles on conflict of laws.

 

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IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement
as of the date and year first above written.

 

   

PRO-PHARMACEUTICALS, INC.

   

By:

 

    /s/ Charles F. Harney

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Charles F. Harney

       

Chief Financial Officer

 

Witness:

 

    /s/ Maureen Foley

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    /s/ David Platt

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David Platt

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Exhibit A

 

List of Prior Inventions

and Original Works of Authorship

 

Title

--------------------------------------------------------------------------------

   Date

--------------------------------------------------------------------------------

   Identifying
Number or
Brief Description

--------------------------------------------------------------------------------

* Composition and Method For Controlling Fungal Disease in Plants

   9/12/97    08/928,370

* Tumor Derived Carbohydrate Binding Protein

   8/6/97    08/908,145

* Modified Pectin

   3/1/93    09/024,487

* Immunotherapeutic Agent

   8/1/93    08/087,628

* Pectin Derived Therapeutic Material

   3/18/97    08/819,356

* Enhancement of Delivery of Radioimaging And Radio Protective Agents

   10/7/98    09/167,685

* Reagent For Tumor Therapy And/or Imaging

   11/18/98    09/195,341

* Delivery System for Gene Therapy

   2/2/99    60/118,244

** Tumor Derived Carbohydrate Binding Protein

   10/28/97    5,681,923

** Immunotherapeutic Agent

   6/18/96    5,527,770

** Immunotherapeutic Agent

   6/2/98    5,759,992

** Composition and Method for Treating Fungal Disease in Animals

   4/6/99    5,891,861

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* As listed in Appendix A - Second Amendment to the License Agreement, dated
January 7, 1994, between International Gene Group, Inc., a Michigan corporation
and Dr. David Platt (the “IGG License Agreement”) listing pending patent
applications.

** As listed in Appendix A - Second Amendment to the IGG License Agreement
listing granted U.S. patents.