Exhibit 10.67

 

ANTARES PHARMA, INC.

 

JACK E. STOVER

 

EMPLOYMENT AGREEMENT

 

THIS AGREEMENT, made and entered into effective as set forth in this Agreement
by and between Antares Pharma, Inc. a Minnesota corporation, (the “Company”),
and Jack E. Stover (the “Officer”).

 

WITNESSETH:

 

WHEREAS, the Company desires to employ the Officer in the capacity as set forth
in this Agreement; and

 

WHEREAS, the Officer is willing to accept employment on the terms and conditions
as set forth in this Agreement.

 

NOW, THEREFORE, IN CONSIDERATION of the premises and of the mutual promises and
covenants contained herein, the Company and the Officer hereby agree as follows:

 

1. Employment.

 

(a) The Company shall employ the Officer, and the Officer shall accept such
employment as its President and Chief Operating Officer (“COO”), during the term
specified in Section 2. The Officer shall perform such duties and render such
services consistent with his position as from time to time may be requested of
him by the Chief Executive Officer (the “CEO”) or Board of Directors of the
Company (the “Board”). The Officer shall report to the CEO.

 

(b) During the term of this Agreement, the Officer may not, without the prior
written consent of the Company, operate, participate in the management,
operations or control of, or act as an employee, officer, consultant, agent or
representative of, any type of business or service (other than as an employee of
the Company). It shall not be deemed a violation of the foregoing for the
Officer to (i) act or serve as a director, trustee or committee member of any
civic or charitable organization; (ii) manage his personal, financial and legal
affairs; or (iii) serve as a director of an organization that is not a civic

 

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or charitable organization with the consent of the Board, which consent shall
not be unreasonably withheld, in all cases so long as such activities (described
in clauses (i), (ii) and (iii)) do not interfere with or constitute a conflict
of interest to the performance of his duties and responsibilities to the Company
as provided hereunder. As of the Start Date, the activities listed on Schedule A
are approved under this Section 1(b).

 

(c) During the term of this Agreement, the Officer shall be invited to meetings
of the Board. The Officer may during the term of this Agreement be asked by the
Board to assume the position of Chief Executive Officer (the “CEO”), reporting
to the Board. The Board shall nominate him for a position on the Board as soon
as reasonably practicable after he assumes the CEO position. Except as otherwise
specifically set forth in this Agreement, all other terms and conditions of this
Agreement shall remain in effect after such assumption.

 

(d) The Company shall indemnify, hold harmless and defend the Officer for his
actions as an employee of the Company to the fullest extent possible under the
laws of Minnesota.

 

2. Term. The effective date of this Agreement shall be the later of the date
that the Officer signs this Agreement or the date the Officer begins working for
the Company as an employee (“Start Date”). The term of the Agreement shall be
the period commencing on the Start Date and ending on the third anniversary of
such date. The Agreement shall automatically renew for successive one-year
periods unless at least 90 days prior to the end of a period, the Company shall
give notice to the Officer that the Agreement shall not be so extended. This
Agreement may be sooner terminated in the manner hereinafter provided. The date
that the Officer ceases performing services for the Company under this Agreement
shall be the “Termination Date.”

 

3. Compensation.

 

(a) Base Salary. The Officer’s salary will be $250,000 per year, payable in
accordance with the Company’s normal payroll practices (the “Base Salary”).
During the term hereof, the Officer’s Base Salary shall be reviewed annually (by
the CEO while the Officer serves as President and COO) and may be increased (but
not decreased) with the approval of the Compensation Committee of the Board
(“Compensation Committee”)

 

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based upon the performance of the Officer and the Company. If and for any period
during which the Officer assumes the position of CEO, the Officer’s Base Salary
shall be at least $300,000 per year.

 

(b) Bonus. For each calendar year in which the Company employs the Officer, the
Officer shall be eligible to receive a target annual bonus of at least 30% with
a maximum of 45% of his Base Salary for the calendar year, the exact amount to
be established (while the Officer serves as President and COO) by the CEO with
the approval of the Compensation Committee (the “Annual Bonus”). The Annual
Bonus shall be payable based upon achieving business objectives to be determined
(while the Officer serves as President and COO) by the CEO in consultation with
the Officer and approved by the Compensation Committee. The business objectives
shall be made available to the Officer in writing before the beginning of each
calendar year. Provided, however, for 2004 the Officer’s bonus shall be a
guaranteed amount of a pro rata portion of $75,000, based on the number of days
remaining in 2004 from and after the Start Date. Any Annual Bonus earned by the
Officer shall be paid within 30 days following the completion of the certified
audit of the Company for the year for which an Annual Bonus is earned.

 

(c) Stock Grant. Effective as of the Start Date, the Officer shall be issued:
(i) 50,000 shares of Common Stock, $.01 par value (“Stock”) in which the Officer
shall be 100% vested on issuance and (ii) an additional 50,000 shares of Stock
in which the Officer shall become 100% vested on the first anniversary of the
Start Date, but only if the Officer is still employed by the Company as of such
date.

 

(d) Stock Options. Effective as of the Start Date, the Officer shall be granted
an option to purchase 500,000 shares of Stock and effective January 2, 2005, an
option to purchase 40,000 shares of Stock at an option exercise price equal to
the fair market value of such Stock as determined by the Board on the date of
grant (the “Options”). The Options shall have a term of no less than five years
and shall vest over a period of four years from the Start Date with 18.50% of
the grant vesting on the two hundred seventieth (270th) day following the Start
Date and the balance vesting pro-rata on a monthly basis thereafter, but only if
the Officer is still employed by the Company as of an applicable vesting date.
The

 

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Options shall be incentive stock options to the extent that they so qualify and
nonqualified stock options to the extent that they cannot so qualify.

 

(e) Additional Stock Grants. Subject to the Officer’s being in the employ of the
Company as its President and COO (or CEO) at the time of the applicable event
listed in this Section 3(e), the Company shall issue to the Officer the
following number of shares of Stock on the following events, said shares to be
100% vested on issuance:

 

Trigger Event

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   No. of Shares

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1. On attainment of a price per share of Stock of $             (double the
closing price of a share of Stock on the Start Date), sustained for at least 50
trading days in a consecutive 60 trading-day period    86,666 shares 2. On
attainment of gross revenues (net of returns) (as determined under generally
accepted accounting principles consistently applied, said determination to be
made by the certified public accountants who audit the books of the Company for
the year) in excess of $10 million for the Company’s fiscal year, excluding
extraordinary items    86,666 shares 3. On the first to occur of (a) attainment
of profitability of the Company for four consecutive calendar quarters, or (b)
gross revenues (net of returns) in excess of $20 million for the Company’s
fiscal year, excluding extraordinary items, in either case said determination to
be made by the certified public accountants who audit the books of the Company
for the year; profitability shall mean an excess of revenue over expenses
determined under generally accepted accounting principles consistently applied
without regard to extraordinary items    86,667 shares

 

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(f) “Stretch” Equity Grant. Subject to the Officer’s being in the employ of the
Company as its President and COO (or CEO) at the time of the applicable event,
the Officer will be granted an additional 200,000 shares of Stock based upon the
achievement of a goal to be determined within six months of the Start Date by
the CEO in consultation with the Officer and approved by the Compensation
Committee, said shares to be 100% vested on issuance.

 

(g) Other Equity Grant Provisions.

 

(i) Any Stock issued under this Agreement will be subject to the terms of any
plan under which it is granted. Any option will be subject to the terms of any
plan under which it is granted and the option agreement to be executed by the
Officer and the Company.

 

(ii) Except as expressly provided in this Agreement all unvested options shall
be deemed immediately forfeited by the Officer upon any termination of the
Officer’s employment pursuant to Section 4, other than Section 4(e) below.

 

(iii) Effective immediately upon the Officer’s becoming eligible for any payment
under Section 4(e)(iii) below, the Company shall have no further obligations
under this Section 3 to grant Stock to the Officer upon the occurrence of any of
the Trigger Events under Section 3(e) or under the “Stretch” equity grant under
Section 3(f).

 

(iv) The Officer shall also be entitled to participate in any other grants as
determined by the Board or Compensation Committee, which grants shall be subject
to the terms of any plan under which they are granted and the grant agreement to
be executed by the Officer and the Company. All of the foregoing documents are
hereby incorporated by reference.

 

(v) The Board shall be entitled to withhold the issuance of shares, including
unrestricted shares otherwise payable under this Agreement unless and until the
Officer has paid or provided for payment of any federal, state or local income
or other tax withholding as the Company determines.

 

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(vi) The number of shares of Stock subject to issuance under this Agreement
shall be adjusted on the same events and in the same manner as shares of Stock
are adjusted for similar events under the Antares Pharma, Inc. 2001 Incentive
Stock Option Plan for Employees, as amended from time to time.

 

(vii) If at any time the Company proposes to register under the Securities Act
of 1933 (the “1933 Act”) (except by a Form S-4 or Form S-8 Registration
Statement or any successor forms) or qualify for a public distribution under
Section 3(b) of the 1933 Act, any of its equity securities or debt with equity
features, it will give written notice to the Officer of its intention to do so
and, on the written request of the Officer given within twenty days after
receipt of the notice, the Company will use its best efforts to cause the shares
of Stock then held by him and not covered by an effective registration statement
requested to be included in the registration (“Registerable Shares”) to be
included in the registration statement proposed to be filed by the Company;
provided, however, that nothing herein shall prevent the Company from, at any
time, abandoning or delaying any registration. If any registration pursuant to
this Section 3(g)(vii) is underwritten in whole or in part, the Company may
require that the Registerable Shares be included in the underwriting on the same
terms and conditions as the securities otherwise being sold through the
underwriters. If a greater number of Registerable Shares is offered for
participation in the proposed offering than in the reasonable opinion of the
managing underwriter of the proposed offering can be accommodated without
adversely affecting the proposed offering, then the number of Registerable
Shares proposed to be offered for registration, as well as the number of
securities of any other selling shareholders participating in the registration,
shall be proportionately reduced to a number deemed satisfactory by the managing
underwriter. The Company shall bear the following fees, costs, and expenses
associated with the inclusion of Registerable Shares in a registration
statement: all registration, filing and NASD fees, printing expenses, fees and
disbursements of counsel and accountants for the Company, fees and disbursements
of counsel for the underwriter or underwriters of such securities (if

 

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the offering is underwritten and the Company is required to bear such fees and
disbursements), all internal expenses, the premiums and other costs of policies
of insurance against liability arising out of the public offering, and legal
fees and disbursements and other expenses of complying with state securities
laws of any jurisdictions in which the securities to be offered are to be
registered or qualified. Fees and disbursements of special counsel and
accountants for the Officer, underwriting discounts and commissions, and
transfer taxes for the Officer and any other expenses relating to the sale of
Registerable Shares by the Officer not expressly included above shall be borne
by the Officer.

 

(h) Vacation/PTO. The Officer shall be entitled to five weeks of vacation/PTO
each calendar year, commencing as of the Start Date, prorated in respect of any
period of employment of less than 12 months in a calendar year. Such paid time
off may be carried over from year to year to the extent permitted in accordance
with standard Company policy (provided the Officer shall not be permitted to
accrue more than 12 weeks of paid time off) and shall be paid to the extent
accrued (and to the extent not used) as of a Termination Date. In addition, the
Officer shall be entitled to all other paid time off in the form of Company
holidays and sick leave (if sick leave is not included in PTO) that is provided
to employees generally.

 

(i) Employee Benefits. The Officer will be entitled to participate in the
employee benefit plans currently and hereafter maintained by the Company of
general applicability to other senior executives of the Company, which may
include, without limitation, group medical, dental, disability, life insurance,
and flexible-spending account plans, to the extent that the Officer meets the
eligibility and participation requirements of such plans. The Company reserves
the right to cancel or change the benefit plans and programs it offers to its
employees at any time.

 

(j) Expense Reimbursement. The Company shall promptly pay or reimburse the
Officer for all reasonable business expenses incurred or paid by the Officer
associated with the performance of duties described in this Agreement to the
extent consistent with the Company’s policies as in effect from time to time.

 

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(k) Automobile Allowance. Recognizing that the Officer will be required to drive
in connection with his duties under this Agreement, the Company shall provide
the Officer with an allowance of $800 per month which amount can be applied to a
lease of an automobile of the Officer’s choosing or can be paid to the Officer
as reimbursement for expenses and depreciation associated with the Officer’s
ownership and maintenance of an automobile.

 

(l) Signing Bonus. The Officer shall receive a signing bonus of $20,000 as of
the first payroll date occurring at least one week after the Start Date.

 

(m) Withholding. The Company shall be entitled to withhold from the Officer’s
compensation, or otherwise provide for, all federal, state or local income or
other taxes which the Company determines are required to be withheld on amounts
payable to the Officer pursuant to this Agreement or otherwise.

 

4. Termination of Employment.

 

(a) Termination for Cause. The Officer’s employment hereunder shall terminate
immediately upon notice that Company is terminating the Officer for Cause (as
defined herein). If the Officer’s employment with the Company is terminated for
Cause, all compensation described in Section 3 of this Agreement shall terminate
as of the Termination Date (except as to amounts already earned).

 

(i) For purposes of this Agreement, “Cause” shall mean:

 

  (A) Knowing dishonesty or fraud committed in connection with the Officer’s
employment;

 

  (B) Theft, misappropriation or embezzlement of Company’s funds;

 

  (C) Conviction of or a plea of guilty or nolo contendere to any felony, a
crime involving fraud or misrepresentation, or any other crime (whether or not
connected with his employment) the effect of which is likely to adversely affect
the Company or its affiliates; or

 

  (D) A material breach by the Officer of any of the provisions or covenants set
forth in this Agreement;

 

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Provided, however, that a termination shall not be considered to be for Cause
unless the Board determines Cause to exist after the Board has given notice to
the Officer identifying the specific matters that constitute Cause and after the
Board has given the Officer the opportunity to address the Board with respect to
the matters. The Officer shall recuse himself from voting as a Board member with
respect to any finding of Cause.

 

(b) Voluntary Resignation Without Good Reason. The Officer may voluntarily
terminate his employment at any time upon 30 days advance notice to the Company.
If the Officer voluntarily resigns his employment without Good Reason (as
defined herein), all compensation described in Section 3 of this Agreement shall
terminate as of the Termination Date (except as to amounts already earned),
regardless of whether sufficient notice of termination was given.

 

(i) For purposes of the Agreement, “Good Reason” shall mean:

 

  (A) a decrease in the Base Salary of the Officer;

 

  (B) a decrease in the minimum target annual bonus below 30% or a decrease in
the maximum target annual bonus below 45% of Base Salary for the calendar year;

 

  (C) a change in the designation of title from President and Chief Operating
Officer of the Company or successor entity, unless such change is to a higher
title and level of responsibility such as Chief Executive Officer and in the
event of such higher title and level of responsibility, a subsequent change in
the designation of such new title;

 

  (D) a change in the CEO of the Company from the present CEO unless the Officer
has been offered the position under this Agreement;

 

  (E) a Company-required relocation of the Officer’s place of residence or
refusal to pay travel and living expenses if the Officer’s place of residence
does not change in response to a Company request; or

 

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  (F) a material breach by the Company of any of the provisions or covenants set
forth in this Agreement;

 

provided, however, that a termination shall not be considered to be for Good
Reason unless the Officer terminates employment within 60 days of the event that
constitutes Good Reason and identifies the specific event that constitutes Good
Reason in a notice of termination to the Company.

 

(c) Termination Without Cause or for Good Reason. If during the term of this
Agreement the Company discharges the Officer without Cause or the Officer
terminates employment for Good Reason, then, subject to Sections 4(f)(v)-(vii)
and 5 and the Officer signing and not revoking a standard release of claims
relating to the Officer’s employment with the Company and/or the termination of
such employment in a form acceptable to the Company (among other claims, such
release not to include claims the Officer may have in his capacity as a
shareholder of the Company or any claim for indemnification based on the
covenant set forth in Section 1(d) hereof), the Officer shall be entitled to (i)
the compensation payable in accordance with the provisions of Section 3(a) of
this Agreement for a period of 12 months following the Termination Date, (ii)
the Company paying the Company-subsidized premiums for major medical and dental
benefits that can be continued for the Officer during the period that
compensation under Section 3(a) is paid following the Termination Date, but only
if the Officer is permitted to and elects to continue such benefits; and (iii)
for the 90-day period following Termination Date, the Officer shall be
considered actively employed in good standing pursuant to this Agreement for
purposes of the equity grants set forth in Section 3(e) and Section 3(f).

 

(d) Death or Disability.

 

(i) The term of employment of the Officer shall terminate on the death of the
Officer. At the option of the Company, the Officer’s employment with the Company
shall terminate upon notice to the Officer, if the Officer shall fail to render
and perform the services required of him under this Agreement because of
Disability (as defined herein). Upon a termination of the Officer’s employment
with the Company because of death or Disability, the Officer shall be entitled
to

 

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receive the same benefits (subject to the same conditions) he would have
received had he been terminated without Cause or for Good Reason as provided for
in Section 4(c).

 

(ii) For purposes of this Agreement, “Disability” shall mean such physical or
mental illness or incapacity of the Officer as shall (A) prevent him from
substantially performing his customary services and duties to the Company, and
(B) continue for periods aggregating more than three months in any 12-month
period. The Company shall determine whether there is a Disability after
consultation with a qualified, independent physician. The Officer shall
cooperate with the Company, including making himself reasonably available for
examination by physicians at the Company’s request, to determine whether or not
he has a Disability. The Officer’s failure (other than a failure caused by the
Disability) to cooperate with the Company in a determination of Disability shall
be treated as the Officer’s voluntary resignation from the Company without Good
Reason.

 

(e) Termination Following a Change in Control.

 

(i) If a Change in Control (as defined herein) occurs, and if the Officer
voluntarily terminates his employment without Good Reason within 30 days
following the closing of the transaction that constitutes the Change in Control,
then the provisions of Section 4(e)(iii) below shall apply. If a Change in
Control occurs and if the employer that survives the Change in Control requests
the Officer to remain employed with the surviving employer for a transition
period (not to exceed one year), then if the Officer remains employed as
requested and voluntarily terminates his employment without Good Reason within
30 days following the close of the requested period of employment, the
provisions of Section 4(e)(iii) below shall apply. If a Change in Control
occurs, and if the surviving employer terminates the Officer’s employment
without Cause within 30 days following the closing of the transaction that
constitutes the Change in Control, then the provisions of Section 4(e)(iii)
below shall apply. If none of the foregoing provisions of this subsection (i)
applies, then the other provisions of

 

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Section 4 (to the extent applicable) shall apply to terminations of employment
that occur after a Change in Control.

 

(ii) If a Change in Control (as defined herein) occurs, then (A) all outstanding
options held by the Officer shall immediately vest and become exercisable and
(B) all restricted stock (other than the restricted stock issued under Section
3(c)(ii)) held by the Officer shall vest.

 

(iii) If the provisions of this subsection (iii) shall apply then, subject to
Sections 4(f)(v)-(vii) and 5 and the Officer signing and not revoking a standard
release of claims relating to the Officer’s employment with the Company and/or
the termination of such employment in a form acceptable to the Company (among
other claims, such release not to include claims the Officer may have in his
capacity as a shareholder of the Company or any claim for indemnification based
on the covenant set forth in Section 1(d) hereof), the Officer shall be entitled
to (A) the compensation payable in accordance with the provisions of Section
3(a) of this Agreement for a period of 12 months following the Termination Date;
(B) the surviving employer paying the employer-subsidized premiums for major
medical and dental benefits that can be continued for the Officer during the
period that compensation under this subsection (iii) is paid following the
Termination Date, but only if the Officer is permitted to and elects to continue
such benefits; and (C) that portion of the Annual Bonus otherwise payable under
Section 3(b) for the year in which the Termination Date occurs based on the
ratio of the number of days in the calendar year that occurs on or before the
Termination Date to the total number of days in the calendar year in which the
Termination Date occurs, as determined in good faith by the surviving employer.

 

(iv) If in connection with a Change in Control, as defined herein, the value of
the Company is at least $75 million, as determined by the Board in good faith,
then immediately before the closing of the transaction that results in the
Change in Control (but contingent on the closing of that transaction), the
Officer shall be issued the difference between (A) 260,000 shares of Stock, and
(B) that

 

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number of shares of Stock previously issued to the Officer under Section 3(e) or
(f). All such issued shares shall be 100% vested on issuance.

 

(v) For purposes of this Agreement, “Change in Control” means (A) an acquisition
by an individual, entity or group (excluding a corporation controlled by the
existing shareholders of the Company as of such date) of 50% or more of the
Company’s then outstanding voting stock or voting securities, but excluding any
sale of stock directly by the Company to a third-party investor; (B) a merger or
consolidation of the Company, other than a merger or consolidation in which the
shareholders immediately prior to such transaction hold at least 50% of the
common interests and voting securities of the resulting company after the merger
or consolidation, but excluding a transaction effected merely to reincorporate
the Company into another jurisdiction; or (C) a sale of all or substantially all
of the assets of the Company to a purchaser other than an entity in which the
existing shareholders immediately prior to the sale hold at least 50% of the
common interests and voting securities after the sale.

 

(vi) The Company shall not consolidate with or merge into any other entity, or
sell, transfer or dispose of all or substantially all of its assets to another
entity, unless such other entity shall assume this Agreement in a signed writing
delivered to the Officer. Upon such assumption, the successor entity shall
become obligated to perform the obligations of the Company under this Agreement
and the term “Company” as used in this Agreement shall be deemed to refer to the
successor entity.

 

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(f) Provisions Applicable to all Terminations.

 

(i) All payments made to the Officer or his estate after the Termination Date
shall be subject to federal, state or local income or other tax withholding as
the Company determines. All payments of Base Salary, Annual Bonus, and expense
reimbursement made to the Officer or his estate after the Termination Date shall
be made in accordance with the Company’s customary payroll and reimbursement
practices with respect to such items.

 

(ii) The Officer shall be entitled to continue health and other benefits after
the Termination Date to the extent and in the manner required by law and
permitted under the terms of the particular benefit plan. The Officer shall be
required to elect any such coverage and to pay the expense of such continuation
coverage except to the extent provided in this Agreement.

 

(iii) The Officer shall be entitled to reimbursement for expenses incurred
through the Termination Date, regardless of the reason for the Termination.

 

(iv) The Officer shall be deemed to have resigned from the Board of the Company
and from any officer or comparable position with the Company as of the
Termination Date, unless otherwise agreed to by the Board of Directors.

 

(v) Promptly after the Termination Date (and in all events within five days of
the Termination Date), the Officer shall return to the Company all property of
the Company, including but not limited to, any office, computing or
communications equipment (e.g., laptop computer, facsimile machine, printer,
cellular phone, etc.) that he has had or has been using, and any business or
business related files that he has had in his possession. The Officer shall also
remove from any personal computing or communications equipment all information
relating to the Company.

 

(vi) The Officer will not make any disparaging or negative remarks, either oral
or in writing, regarding the Company, or any of its current or former owners,
partners, officers, agents, assigns, directors, employees or representatives,
either individually or in any representative capacity. The Company will not make

 

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any disparaging or negative remarks, either oral or in writing, regarding the
Officer.

 

(vii) The Officer shall provide the Company with reasonable assistance after the
Termination Date with respect to actual or threatened legal, administrative, or
other proceedings involving the Company. The Officer shall be reimbursed for
reasonable expenses, including reasonable attorneys’ fees associated with such
assistance, but shall not be compensated for his time.

 

(viii) The Officer agrees and acknowledges that the Officer’s right to receive
severance payments set forth in Section 4 (to the extent the Officer is
otherwise entitled to such payments) shall be conditioned upon the Officer
meeting the requirements of this Agreement, including the obligations under
Section 4(f)(v)-(vii) and Section 5.

 

(ix) Payments under this Agreement shall be made without regard to whether the
deductibility of such payments (or any other payments) would be limited or
precluded by Section 280G of the Internal Revenue Code of 1986 (the “Code”) and
without regard to whether such payments would subject the Officer to the federal
excise tax levied on certain “excess parachute payments” under Section 4999 of
the Code; provided, however, that if the Total After-Tax Payments (as defined
below) would be increased by the limitation or elimination of any amount payable
under this Agreement, then amounts payable under this Agreement will be reduced
to the extent necessary to maximize the Total After-Tax Payments. The
determination of whether and to what extent payments under this Agreement are
required to be reduced in accordance with the preceding sentence will be made at
the Company’s expense by an independent, certified public accountant selected by
the Officer and reasonably acceptable to the Company. In the event of any
underpayment or overpayment under this Agreement (as determined after the
application of this Section 4(f)(ix)), the amount of such underpayment or
overpayment will be immediately paid by the Company to the Officer or refunded
by the Officer to the Company, as the case may be. For purposes of this
Agreement, “Total After-Tax Payments” means the

 

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total of all “parachute payments” (as that term is defined in Section 280G(b)(2)
of the Code) made to or for the benefit of Officer (whether made hereunder or
otherwise), after reduction for all applicable federal taxes (including, without
limitation, the tax described in Section 4999 of the Code).

 

5. Confidential Information. The Officer agrees to enter into the Company’s
standard Confidential Information and Invention Assignment Agreement (the
“Confidential Information Agreement”) upon commencing employment hereunder. The
Officer hereby agrees that, during the term of the Agreement and thereafter, he
will hold in strict confidence any proprietary or Confidential Information
related to the Company and its affiliates, except that he may disclose such
information pursuant to law, court order, regulation or similar order. For
purposes of this Agreement, the term “Confidential Information” shall mean all
information of the Company or any of its affiliates (in whatever form) which is
not generally known to the public, including without limitation any inventions,
processes, methods of distribution, customer lists or customers’ or trade
secrets. The Officer hereby agrees that, upon the termination of this Agreement,
he shall not take, without the prior written consent of the Company, any
document (in whatever form) of the Company or its affiliates, which is of a
confidential nature relating to the Company or its affiliates, or, without
limitation, relating to its or their methods of distribution, or any description
of any formulas or secret processes and will return any such information (in
whatever form) then in his possession.

 

The Officer shall promptly, but in no event later than five days after the
earlier of accepting an offer of employment or commencing any employment during
the 12 month period following the Termination Date, inform the Company of the
identity of the Officer’s employer. The Officer shall at the same time inform
the Officer’s new employer of the Officer’s obligations and restrictions under
this Section 5 and shall give notice to the Company of the Officer’s fulfillment
of that obligation.

 

6. Non-Assignability; Binding Agreement. The Officer may not assign this
Agreement nor any right, obligation, or interest hereunder without the prior
written consent of the Company; provided, however, that nothing in this
Agreement shall preclude the Officer from designating any beneficiaries to
receive any benefits payable hereunder upon his death, or the executors,
administrators, or other legal representatives of his estate from assigning any
rights hereunder to the

 

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person or persons entitled thereto, consistent with the terms of any relevant
plans. This Agreement shall be binding upon, and inure to the benefit of, the
parties hereto, and the Officer’s heirs, permitted assigns, and the personal
representative of the Officer’s estate.

 

7. Entire Agreement; Amendment; Waiver. This Agreement, together with the
Confidential Information Agreement, any stock plan, and any option agreement,
constitute the entire agreement of the parties pertaining to the subject matter
hereof, and the parties have made no agreements, representations, or warranties
relating to the subject matter of this Agreement that are not set forth herein
or therein. This Agreement, together with the Confidential Information
Agreement, any stock plan, and any option agreement shall supersede any existing
agreement between the Officer and the Company or its predecessors providing for
employment, bonus, or any other incentive compensation. This Agreement may not
be modified, amended, or waived in any manner except by an instrument in writing
signed by each of the parties hereto. The waiver by any party of compliance with
any provision of this Agreement by the other party shall not operate or be
construed as a waiver of any other provision of this Agreement, or of any other
breach by such party of a provision of this Agreement.

 

8. Injunctive Relief. It is impossible to measure in money the damages that will
accrue to the Company in the event that the Company breaches the covenants
provided in Section 4(f)(vi) and 5 hereof. In the event that the Officer
breaches any such covenant, the Company shall be entitled to an injunction
restraining the Officer from violating such covenant. If the Company shall
institute any action or proceeding to enforce any such covenant, the Officer
hereby waives the claim or defense that the Company has an adequate remedy at
law and agrees not to assert in any such action or proceeding the claim or
defense that the Company has an adequate remedy at law. This right to injunctive
relief shall be in addition to the Company’s right to cease severance payments
upon the Officer’s violation of Section 4(f)(vi) or 5.

 

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9. Representations.

 

(a) The parties hereto hereby represent that they each have the authority to
enter into this Agreement, and the Officer hereby represents to the Company that
the execution of, and performance of duties under, this Agreement shall not
constitute a breach of or otherwise violate any other agreement to which the
Officer is a party.

 

(b) The Officer hereby represents to the Company that he will not utilize or
disclose any confidential information obtained by the Officer in connection with
any former employment with respect to his duties and responsibilities hereunder,
and the Company covenants that it will not ask the Officer to do so.

 

10. Notices. Any notice or communication required or permitted under the terms
of this Agreement shall be in writing and shall be delivered personally, or sent
by registered or certified mail, return receipt requested, postage prepaid, or
sent by nationally recognized overnight carrier, postage prepaid, or sent by
facsimile transmission to the Company at the Company’s principal office and
facsimile number or to the Officer at the address and facsimile number, if any,
appearing on the books and records of the Company. Such notice or communication
shall be deemed given (a) when delivered if personally delivered; (b) five
mailing days after having been placed in the mail, if delivered by registered or
certified mail; (c) the business day after having been placed with a nationally
recognized overnight carrier, if delivered by nationally recognized overnight
carrier, and (d) the business day after transmittal when transmitted with
electronic confirmation of receipt, if transmitted by facsimile. Any party may
change the address or facsimile number to which notices or communications are to
be sent to it by giving notice of such change in the manner herein provided for
giving notice. Until changed by notice, the following shall be the address and
facsimile number to which notices shall be sent:

 

If to the Company, to:

 

ANTARES PHARMA, INC.

707 Eagleview Boulevard

Suite 414

Exton, PA 19341

Attn: Roger G. Harrison, Ph.D.

(610) 458-0756 (facsimile)

 

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If to the Officer, to the address and/or facsimile number contained in the
Company’s personnel files as provided by the Officer from time to time.

 

11. Governing Law and Arbitration. This Agreement will be governed by and
construed in accordance with the Laws of the Commonwealth of Pennsylvania
without regard to conflict of law principles. Any disagreement, dispute,
controversy or claim arising out of or relating to this Agreement or its
interpretation or any agreements relating hereto or contemplated herein or the
interpretation, breach, termination, validity or invalidity hereof shall be
settled exclusively and finally by arbitration; provided that neither the
Officer nor the Company shall be required to submit claims for injunctive relief
to enforce the covenants contained in Sections 4(f)(vi) and 5 of this Agreement
to arbitration. Arbitration shall be held in Philadelphia, Pennsylvania, in
accordance with the then prevailing National Rules for the Resolution of
Employment Disputes of the American Arbitration Association by a single
arbitrator. Any party may initiate arbitration by giving the other party written
notice of the commencement of arbitration. To the extent not inconsistent with
other provisions of this Section 11, the arbitration procedure shall be governed
by the United States Arbitration Act, 9 U.S.C. §§ 1-16, and the award rendered
by the arbitrator shall be final and binding on the parties and may be entered
in any court having jurisdiction. Each party shall have discovery rights as
provided by the Federal Rules of Civil Procedure; provided, however, that all
such discovery shall be commenced and concluded within 90 days of the initiation
of arbitration. It is the intent of the parties that any arbitration shall be
concluded as quickly as reasonably practicable. Unless the parties otherwise
agree, once commenced, the hearing on the disputed matters shall be held four
days a week until concluded, with each hearing date to begin at 9:00 a.m. and to
conclude at 5:00 p.m. The arbitrator shall use all reasonable efforts to issue
the final award or awards within a period of five business days after closure of
the proceedings. Failure of the arbitrator to meet the time limits of this
Section 11 shall not be a basis for challenging the award. The parties waive any
claim to any damages in the nature of punitive, exemplary or statutory damages
in excess of compensatory damages, or any form of damages in excess of
compensatory damages, and the arbitrator is specifically divested of any power
to award damages in the nature of punitive, exemplary or statutory damages in
excess of compensatory damages, or any form of damages in excess of compensatory
damages. Each party shall bear its own costs and attorneys’ fees in connection

 

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with the arbitration and shall share equally the fees and expenses of the
arbitrator. The arbitration award shall be paid within 30 days after the award
has been made. Each party agrees that any legal proceeding instituted to enforce
an arbitration award hereunder will be brought in a court of competent
jurisdiction (either state or federal) in Philadelphia, Pennsylvania, and hereby
submits to personal jurisdiction of such courts and irrevocably waives any
objection as to venue in such courts, and further agrees not to plead or claim
in any such court that any such proceeding has been brought in an inconvenient
forum.

 

12. Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed to be an original, but all such counterparts shall together
constitute one and the same instrument. The Company’s signature below shall
constitute a binding offer of employment on the terms and conditions in this
Agreement for a period of 30 days following the Company’s signing of the
Agreement. The Officer may accept the offer at any time within the 30-day period
by signing and returning a counterpart signature page.

 

13. Headings; Gender. The headings of sections and subsections herein are
included solely for convenience of reference and shall not control the meaning
or interpretation of any of the provisions of this Agreement.

 

14. Survivability. The obligations of the parties set forth in this Agreement
that are to be carried out after the termination of the Officer’s employment
shall survive the termination of this Agreement regardless of the reason for
termination. These obligations include obligations under Sections 4(f)(v)-(vii),
5, 8, and 11, among others.

 

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

 

       

COMPANY

       

ANTARES PHARMA, INC.

_______________________

      By    

Date signed

     

Its

   

 

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OFFICER

 

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

     

 

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

Date signed

     

Jack E. Stover

 

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Schedule A

 

PERMITTED OUTSIDE ACTIVITIES

 

Director, Ben Franklin Partnership on North East Philadelphia (nonprofit)

 

Director, Chairman (nonexecutive) and Shareholder, PHC Industries Inc. (private
family business)

 

Director and Shareholder, The Pineville Tavern and Dishes Inc. (private real
estate investment)

 

Director, Gynetics, Inc. (private, former pharmaceutical business employer)

 

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