Exhibit 10.18  AMENDED AND RESTATED EXECUTIVE EMPLOYMENT
AGREEMENT  This AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT (the Agreement)
dated March 11, 2009 by and between Callisto Pharmaceuticals,, Inc.,
a company incorporated under the laws of Delaware (the Company), and Gary S.
Jacob, Ph.D., an individual (the Executive) with reference to the following
facts:  WHEREAS, the Company owns approximately 68% of the outstanding common
stock of Synergy Pharmaceuticals, Inc. (Synergy) and the Executive
serves as the CEO of the Company and President and Acting Chief Executive
Officer of Synergy.  WHEREAS, both the Company and Synergy are engaged in the business of
developing and marketing drug products.  WHEREAS, the Executive has previously entered into an employment
agreement with the Company as of June 13, 2003, as amended October 19,
2005 and an extension and amendment agreement dated as of February 15,
2007 (collectively, the Employment Agreement);  WHEREAS, the parties wish to amend and restate the Employment Agreement
between the Executive and the Company in its entirety, on the terms and
conditions contained in this Agreement.  NOW THEREFORE, in consideration of the foregoing facts and mutual
agreements set forth below, the parties, intending to be legally bound, agree
as follows:  1.Employment.    The
Company hereby agrees to employ Executive, and Executive hereby accepts such
employment and agrees to perform Executives duties and responsibilities in
accordance with the terms and conditions hereinafter set forth.  1.1Duties
and Responsibilities.    Executive shall serve as Chief
Executive Officer. During the Employment Term, Executive shall perform all
duties and accept all responsibilities incident to such positions and other
appropriate duties as may be assigned to Executive by the Companys Board of
Directors from time to time, and by the Chief Executive Officer, when a Chief
Executive Officer is appointed. Executive shall also serve as a director of the
Company if requested by the Companys Board of Directors, and as an officer of
one or more of the Companys subsidiaries without any additional compensation.
The Company shall retain full direction and control of the manner, means and
methods by which Executive performs the services for which he is employed
hereunder and of the place or places at which such services shall be rendered.
The Executive also agrees that in the absence of a Chief Accounting Officer, he
will sign various federal and state securities filings as the Companys principal
accounting officer.  1.2Employment
Term.    The term of Executives employment under this
Agreement shall commence as of August 1, 2008 (the Effective Date) and
shall continue


until December 31, 2011, unless earlier terminated in accordance
with Section 4 hereof. The term of Executives employment shall be
automatically renewed for successive one (1) year periods until the
Executive or the Company delivers to the other party a written notice of their
intent not to renew the Employment Term, such written notice to be delivered
at least sixty (60) days prior to the expiration of the then-effective Employment
Term as that term is defined below. The period commencing as of the Effective
Date and ending December 31, 2011 or such later date to which the term of
Executives employment under the Agreement shall have been extended Agreement
is referred to herein as the Employment Term and the end of the Employment
Term is referred to herein as the Expiration Date.  1.3Extent of Service.    Except
for discharging his duties as Acting Chief Executive Officer and President of
Synergy, the Companys majority owned subsidiary, during the Employment Term,
Executive agrees to use Executives best efforts to carry out the duties and
responsibilities under Section 1.1 hereof and to devote substantially all
Executives business time, attention and energy thereto. Executive further
agrees not to work either on a part-time or independent contracting basis for
any other business or enterprise during the Employment Term without the prior
written consent of the Companys Board of Directors (the Board), which
consent shall not be unreasonably withheld.  1.4Base Salary.  (a)The
Company shall pay Executive a base salary (the Base Salary) at the annual
rate of $300,000 (U.S.) payable at such times as the Company customarily pays
its other senior level executives (but in any event no less often than
monthly). The Base Salary shall be subject to all state, federal, and local
payroll tax withholding and any other withholdings required by law. The overall
cap of $300,000 shall not be diminished by any bonus or accelerated payment
benefit given to Executive by Synergy. 
The Executives Base Salary may be increased, but not decreased by the
Compensation Panel.  Once increased, such
increased amount shall constitute the Executives Base Salary and shall not be
decreased.  (b)It is expressly
acknowledged that Executives Base Salary shall be allocated between the
Company and Synergy, so that the aggregate Base Salary payable to the Executive
during the Employment Term from the Company and Synergy will not exceed
$300,000 (or such higher amount as is determined by the committee of the
Companys and/or Synergys Board of Directors empowered to fix or review
compensation of the other executive officers of the Company (the Compensation
Panel).  The current estimate of such
allocation is that 75% of the Executives Base Salary shall be payable by
Synergy and 25% of such Base Salary shall by payable by the Company, however
such allocation may change, no more frequently than once each fiscal quarter as
determined in good faith by Synergys Chief Financial Officer.  At any time if Synergy is not obligated


to or does not pay its allocated share of Executives Base Salary, the
Company shall pay Executives Base Salary in full, irrespective of any accounting
allocation.  (c)In
the event Synergy is obligated to pay any item of compensation or reimburse
expenses to Executive under this Agreement, Synergy fails to do so and the
Company makes payment to the Executive pursuant to Section 1.4(b) of
this Agreement, the Company shall be subrogated to all claims of the Executive
against Synergy arising from Synergys failure to make payment to the extent of
such payments made to the Executive.  1.5Incentive
Compensation.  (a)Bonus. Executive
shall be eligible to earn a cash bonus of up to 50% of his Base Salary per full
calendar year during the Employment Term (and a pro rated bonus for the period
from August 1, 2008 to December 31, 2008) based on meeting
performance objectives and bonus criteria to be mutually identified by
Executive and the Compensation Panel. 
Bonuses, if any, shall be subject to all applicable tax and payroll
withholdings.  The bonus shall be
determined on or before March 1 of each year of the Employment Term
commencing March 1, 2009 and paid on or before April 14 of each year.  (b)Realization Bonus.  (i)            In
the event during the Term of this Agreement the Company enters into either a
out-license agreement for any technology relating to cancer or rheumatoid
arthritis that grants exclusive marketing rights to a third party, engages in a
merger transaction or a sale of substantially all of the assets of the Company
that relate to the treatment of cancer or rheumatoid arthritis or enters into a
joint venture in which the Company contributes such rights to the joint
venture, in each case where the Enterprise Value (defined below) equals or
exceeds the minimum value of $150 million, $200 million and $250 million in the
first, second, third years of the Term or any years beyond the third year of
the Term, respectively, (each, a  Realization Transaction), or the license
fees the Company contracts to receive (disregarding any contingencies to such
payment) equals or exceeds $50 million, the Company shall accrue a bonus determined
by multiplying the Enterprise Value (defined below) in the case of a merger, sale
or the sum of the license fees actually received in the case of an out license,
as the case may be, by 0.5% (one half percent).  (ii)           The
accrued bonuses shall be payable to Executive (a) in cash in full 5
business days after the closing of any Realization Transaction involving a sale
or merger, notwithstanding that the consideration for such merger or sale
consists in whole or in part of securities of the acquiring company;  or (b) in cash 5 business days after the
Companys receipt of license fees at the rate of 0.5% of license fees actually
received.  The expiration or termination
of this Agreement shall not terminate or diminish


the Executives right to receive bonus payments with respect to out
license fees collected after the termination or expiration of this Agreement.  (iii)          The
Enterprise Value in the case of a Change in Control in which consideration is
payable to the Company in respect of its assets or business, shall mean the
total cash and non-cash (including, without limitation, the assumption of debt)
consideration received by the Company or in the case of a Change in Control in
which consideration is payable to the Companys stockholders, the total cash
and non-cash (including, without limitation, the assumption of debt)
consideration payable to the Companys stockholders. Enterprise Value shall
also include, if applicable, any cash or non-cash consideration payable to the
Company or to the Companys stockholders on a contingent, earnout or deferred
basis. To the extent that any consideration in a transaction is not received in
cash upon the consummation of the Change in Control, the value of such non-cash
consideration for purposes of calculating the Enterprise Value will be
determined by the Board of Directors of the Company prior to the Change in
Control in good faith. In the event that less than 100% of the stock or assets
of the Company is purchased in the Change in Control transaction, the
Enterprise Value shall be extrapolated from the percentage of the Companys
capital stock or assets impacted in such Change in Control transaction to
determine if the $400 million threshold was exceeded, but the Transaction Fee
shall be calculated based on the actual consideration received by the Company
or shareholders, as the case may be. Section 4.2(b)(i), however, shall not
apply to any event resulting in a Change in Control in which neither the
Company nor its stockholders receives consideration either upon, or in
connection with, the occurrence or consummation of the event resulting in a
Change in Control.  (c)Options.
      The Compensation Panel will consider grants of
options to the Executive no less frequently than annually commencing March 1,
2010.  (d)Executive Benefits.
      The Executive shall be entitled to participate
in all executive benefit or incentive compensation plans now maintained or
hereafter established by the Company for the purpose of providing compensation
and/or benefits to executives of the Company and any supplemental retirement,
salary continuation, stock option, deferred compensation, supplemental medical
or life insurance or other bonus or incentive compensation plans. Unless
otherwise provided herein, the Executives participation in such plans shall be
on the same basis and terms as other similarly situated executives of the
Company. No additional compensation provided under any of such plans shall be
deemed to modify or otherwise affect the terms of this Agreement or any of the
Executives entitlements hereunder.  1.6Other Benefits.
      During the Employment Term, Executive shall be
entitled to participate in all employee benefit plans and programs made
available to the Companys senior level executives as a group or to its
employees generally, as such plans or programs may be in effect from time to
time (the Benefit Coverages), including, without limitation, medical, dental,
hospitalization,


short-term and long-term disability and life insurance plans,
accidental death and dismemberment protection and travel accident insurance.
Executive shall be provided office space and staff assistance appropriate for
Executives position and adequate for the performance of his duties.  1.7Reimbursement
of Expenses; Vacation; Sick Days and Personal Days.  Executive shall be provided with
reimbursement of expenses related to Executives employment by the Company on a
basis no less favorable than that which may be authorized from time to time by
the Board, in its sole discretion, for senior level executives as a group.
Executive shall be entitled to vacation and holidays in accordance with the
Companys normal personnel policies for senior level executives, but not less
than three (3) weeks of vacation per calendar year, provided Executive
shall not utilize more than ten (10) consecutive business days without the
express consent of the Board of Directors. Unused vacation time will be
forfeited as of December 31 of each calendar year of the Employment Term.
Executive shall be entitled to no more than an aggregate of ten (10) sick
days and personal days per calendar year.  1.8No
Other Compensation.  Except as expressly provided in Sections 1.4
through 1.8, Executive shall not be entitled to any other compensation or
benefits.  2.Confidential
Information. Executive recognizes and acknowledges that by reason of
Executives employment by and service to the Company before, during and, if
applicable, after the Employment Term, Executive will have access to certain
confidential and proprietary information relating to the Companys business,
which may include, but is not limited to, trade secrets, trade know-how,
product development techniques and plans, formulas, customer lists and
addresses, financing services, funding programs, cost and pricing information,
marketing and sales techniques, strategy and programs, computer programs and
software and financial information (collectively referred to as Confidential
Information). Executive acknowledges that such Confidential Information is a
valuable and unique asset of the Company and Executive covenants that he will
not, unless expressly authorized in writing by the Company, at any time during
the course of Executives employment use any Confidential Information or
divulge or disclose any Confidential Information to any person, firm or
corporation except in connection with the performance of Executives duties for
the Company and in a manner consistent with the Companys policies regarding
Confidential Information. Executive also covenants that at any time after the
termination of such employment, directly or indirectly, he will not use any
Confidential Information or divulge or disclose any Confidential Information to
any person, firm or corporation, unless such information is in the public
domain through no fault of Executive or except when required to do so by a
court of law, by any governmental agency having supervisory authority over the
business of the Company or by any administrative or legislative body (including
a committee thereof) with apparent jurisdiction to order Executive to divulge,
disclose or make accessible such information. All written Confidential
Information (including, without limitation, in any computer or other electronic
format) which comes into Executives possession during the course of Executives
employment shall remain the property of the Company. Except as required in the
performance of Executives duties for the Company, or unless expressly
authorized in writing by the Company, Executive shall not remove any written
Confidential Information from the Companys premises, except in connection with
the performance of


Executives duties for the Company and in a manner consistent with the
Companys policies regarding Confidential Information. Upon termination of
Executives employment, the Executive agrees to return immediately to the
Company all written Confidential Information (including, without limitation, in
any computer or other electronic format) in Executives possession. As a
condition of Executives continued employment with the Company and in order to
protect the Companys interest in such proprietary information, the Company
shall require Executives execution of a Confidentiality Agreement and
Inventions Agreement in the form attached hereto as Exhibit B, and
incorporated herein by this reference.  3.Non-Competition;
Non-Solicitation.  3.5Non-Compete.
      The Executive hereby covenants and agrees that
during the term of this Agreement and for a period of one year following the
end of the Employment Term, the Executive will not, without the prior written
consent of the Company, directly or indirectly, on his own behalf or in the
service or on behalf of others, whether or not for compensation, engage in any
business activity, or have any interest in any person, firm, corporation or
business, through a subsidiary or parent entity or other entity (whether as a
shareholder, agent, joint venturer, security holder, trustee, partner,
Executive, creditor lending credit or money for the purpose of establishing or
operating any such business, partner or otherwise) with any Competing Business
in the Covered Area. For the purpose of this Section 3.1, (i) Competing
Business means any biotechnology or pharmaceutical company, any contract
manufacturer, any research laboratory or other company or entity (whether or
not organized for profit) that has, or is seeking to develop, one or more
products or therapies that is related to azaspiranes and guanylyl cyclase
receptor agonists and (ii) Covered Area means all geographical areas of
the United States and foreign jurisdictions where the Company then has offices
and/or sells its products directly or indirectly through distributors and/or
other sales agents. Notwithstanding the foregoing, the Executive may own shares
of companies whose securities are publicly trades, so long as such securities
do not constitute more than one percent (1%) of the outstanding securities of
any such company.  3.6Non-Solicitation.
The Executive further agrees that as long as the Agreement remains in effect
and for a period of one (1) year from its termination, the Executive will
not divert any business of the Company and/or its affiliates or any customers
or suppliers of the Company and/or the Companys and/or its affiliates
business to any other person, entity or competitor, or induce or attempt to
induce, directly or indirectly, any person to leave his or her employment with
the Company.  3.7Remedies.
The Executive acknowledges and agrees that his obligations provided herein are
necessary and reasonable in order to protect the Company and its affiliates and
their respective business and the Executive expressly agrees that monetary
damages would be inadequate to compensate the Company and/or its affiliates for
any breach by the Executive of his covenants and agreements set forth herein.
Accordingly, the Executive agrees and acknowledges that any such


violation or threatened violation of this Section 3 will cause
irreparable injury to the Company and that, in addition to any other remedies
that may be available, in law, in equity or otherwise, the Company and its
affiliates shall be entitled to obtain injunctive relief against he threatened
breach of this Section 3 or the continuation of any such breach by the
Executive without the necessity of proving actual damages.  4.Termination.  4.5Termination
Without Cause or for Good Reason.  (c)If this Agreement is
terminated by the Company other than for Cause (as defined in Section 10.4
hereof) or as a result of Executives death or Permanent Disability (as defined
in Section 4.2 hereof), or if Executive terminates his employment for Good
Reason (as defined in Section 4.1(b) hereof) prior to the Expiration Date,
Executive shall receive or commence receiving as soon as practicable in
accordance with the terms of this Agreement:  (i)a
severance payment (the Severance Payment), which amount shall be paid in a
cash lump sum within ten (10) days of the date of termination, in an
amount equal to the higher of the aggregate amount of the Executives Base
Salary for the then remaining term of this Agreement or twelve times the
average monthly Base Salary paid or accrued during the three full calendar
months immediately preceding such termination;  (ii)expense
compensation, which shall be paid in a lump sum payment within ten (10) days
of the date of termination, in an amount equal to twelve times the sum of
average Base Salary during the three full months immediately preceding such
termination of providing the services to Executive set forth in Section 1.4
and Executives reimbursed expenses set forth in Section 1.7;  (iii)immediate
vesting of all unvested stock options and the extension of the exercise period
of such options to the later of the longest period permitted by the Companys
stock option plans or ten years following the Termination Date;  (iv)payment
in respect of compensation earned but not yet paid (the Compensation Payment)
which amount shall be paid in a cash lump sum within ten (10) days of the
date of termination; and  (v)payment
of the cost of comprehensive medical insurance for Executive for a period of twelve
months following the termination.


(d)For
purposes of this Agreement, Good Reason shall mean any of the following
(without Executives express prior written consent):  (i)Any
material breach by Company of any provision of this Agreement, including any
material reduction by Company of Executives duties or responsibilities (except
in connection with the termination of Executives employment for Cause, as a
result of Permanent Disability, as a result of Executives death or by
Executive other than for Good Reason);  (ii)A
reduction by the Company in Executives Base Salary or any failure of the
Company to reimburse Executive for material expenses described in Section 1.7;  (iii)The
failure by the Company to obtain the specific assumption of this Agreement by
any successor or assign of Company as provided for in Section 11 hereof;  (iv)Moving
the principal offices of Company to a location outside of the Metropolitan New
York Area; or  (v)Upon
a Change of Control of Company (as such term is hereinafter defined).  (e)The following
provisions shall apply in the event compensation provided in Section 4.1(a)
becomes payable to the Executive:  (i)if the severance
compensation provided for in subsection 4.1(a) above cannot be finally
determined on or before the tenth day following such termination, the Company
shall pay to the Executive on such day an estimate, as determined in good faith
by the Company of the minimum amount of such compensation and shall pay the
remainder of such compensation (together with interest at the Federal
short-term rate provided in Section 1274(d)(7)(C)(1) of the Code) as
soon as the amount thereof can be determined but in no event later than the
thirtieth day after the Date of Termination. In the event the amount of the
estimated payment exceeds the amount subsequently determined to have been due,
such excess shall constitute a loan by the Company to the Executive payable on
the fifth day after demand by the Company (together with interest at the
Federal short-term rate provided in Section 1274(d)(7)(C)(1) of the
Code).  (ii)If the payment of the
Total Payments (as defined below) will be subject to the tax (the Excise Tax)
imposed by Section 4999 of the Code, the Company shall pay the Executive
on or before the tenth day following the Date of Termination, an additional
amount (the Gross-Up Payment) such that the net amount retained by the


Executive, after deduction of any Excise Tax on Total Payments and any
federal and state and local income tax and Excise Tax upon the payment provided
for by this paragraph, shall be equal to the Total Payments. For purposes of
determining whether any of the payments will be subject to the Excise Tax and
the amount of such Excise Tax, (A) any payments or benefits received or to
be received by the Executive in connection with a Change in Control of the
Company or the Executives termination of employment, whether payable pursuant
to the terms of Section 10 of this Agreement or any other plan,
arrangement or agreement with the Company, its successors, any person whose
actions result in a Change in Control of the Company or any corporation
affiliated (or which, as a result of the completion of transaction causing such
a Change in control, will become affiliated) with the Company within the
meaning of Section 1504 of Code (the Total Payments) shall be treated as
parachute payments within the meaning of Section 28OG(b)(2) of the
Code, and all excess parachute payments within the meaning of Section 28OG(b)(1) shall
be treated as subject to the Excise Tax, unless, in the opinion of tax counsel
selected by the Companys independent auditors and acceptable to the Executive,
the Total Payments (in whole or in part) do not constitute parachute payments,
or such excess parachute payments (in whole or in part) represent reasonable
compensation for services actually rendered within the meaning of Section 28OG(b)(4) of
the Code either in their entirety or in excess of the base amount within the
meaning of Section 28OG(b)(3) of the Code, or are otherwise not
subject to the Excise Tax, (B) the amount of the Total Payments that shall
be treated as subject to the Excise Tax shall be equal to the lesser of (I) the
total amount of the Total Payments or (II) the amount of excess parachute
payments or benefit shall be determined by the Companys independent auditors
in accordance with the principles of Section 28OG(d)(3) and (4) of
the Code. For purposes of determining the amount of the Gross-Up Payment, the
Executive shall be deemed to pay federal income taxes at the highest marginal
rate of federal income taxation in the calendar year in which the Gross-Up
Payment is to be made and state and local income taxes at the highest marginal
rate of taxation in the state and locality of the Executives residence an the
Date of Termination, net of the maximum reduction in federal income taxes which
could be obtained from deduction of such state and local taxes. In the event
the Excise Tax is subsequently determined to be less than the amount taken into
account hereunder at the time of termination of the Executives employment, the
Executive shall repay to the Company at the time the amount of such reduction
in Excise Tax is finally determined the portion of the Gross-Up Payment that
can be repaid such that


the Executive remains whole on an after-tax basis following such
repayment (taking into account any reduction in income or excise taxes to the
Executive from such repayment) plus interest on the amount of such repayment at
the Federal short-term rate provided in Section 1274(d)(1)(C)(i) of
the Code. In the event the Excise Tax is determined to exceed the amount taken
into account hereunder at the time of the termination of the Executives
employment (including by reason of any payment the existence or amount of which
cannot be determined at the time of the Gross-Up Payment), the Company shall
make an additional gross-up payment in respect of such excess (plus any
interest payable with respect to such excess) at the time that the amount of
such excess is finally determined.  4.6Permanent
Disability.  If Executive becomes totally and permanently
disabled (as defined in the Companys disability benefit plan applicable to
senior executive officers as in effect on the date thereof) (Permanent
Disability), Company or Executive may terminate this Agreement on written
notice thereof, and Executive shall receive or commence receiving, as soon as
practicable:  (c)amounts payable
pursuant to the terms of the disability insurance policy or similar arrangement
which Company maintains for the Executive, if any, during the term hereof;  (d)the
Compensation Payment which shall be paid to Executive as a cash lump sum within
30 days of such termination; and  (e)immediate vesting of
all unvested stock options.  4.7Death.    In the event of Executives death during the
term of his employment hereunder, Executives estate or designated
beneficiaries shall receive or commence receiving, as soon as practicable in
accordance with the terms of this Agreement:  (c)compensation
equal to one years Base Salary (calculate by multiplying the average monthly
Base Salary paid or accrued for the three full calendar months immediately such
event, which shall be paid within 30 days of such termination;  (d)any
death benefits provided under the Executive benefit programs, plans and
practices in which the Executive has an interest, in accordance with their
respective terms;  (e)the
Compensation Payment which shall be paid to Executives estate as a cash lump
sum within 30 days of such termination; and


(f)such other payments
under applicable plans or programs to which Executives estate or designated
beneficiaries are entitled pursuant to the terms of such plans or programs.  4.8Voluntary
Termination by Executive: Discharge for Cause.The Company shall have the
right to terminate this Agreement for Cause (as hereinafter defined). In the
event that Executives employment is terminated by Company for Cause, as
hereinafter defined, or by Executive other than for Good Reason or other than
as a result of the Executives Permanent Disability or death, prior to the
Termination Date, Executive shall be entitled only to receive, as a cash lump
sum within 30 days of such termination, the Compensation Payment.  As used herein, the term Cause shall be
limited to (a) willful malfeasance or willful misconduct by Executive in
connection with the services to the Company in a matter of material importance
to the conduct of the Companys affairs which has a material adverse affect on
the business of the Company, or (b) the conviction of Executive for
commission of a felony.  For purposes of
this subsection, no act or failure to act on the Executives part shall be
considered willful unless done, or omitted to be done, by the Executive not
in good faith and without reasonable belief that his action or omission was in
the best interest of the Company. 
Termination of this Agreement for Cause pursuant to this Section 4.4
shall be made by delivery to Executive of a copy of a resolution duly adopted
by the affirmative vote of all of the members of the Board of Directors called
and held for such purpose (after 30 days prior written notice to Executive and
reasonable opportunity for Executive to be heard before the Board of Directors
prior to such vote), finding that in the good faith business judgment of such
Board of Directors, Executive was guilty of conduct set forth in any of clauses
(a) through (b) above and specifying the particulars thereof.  5.Change
In Control.  5.5Definition.       For
purposes of this Agreement, a Change in Control shall be deemed to have
occurred if (i) there shall be consummated (A) any consolidation or merger
of the Company in which the Company is not the continuing or surviving
corporation or pursuant to which shares of the Companys Common Stock would be
converted into cash, securities or other property, other than a merger of the
Company in which the holders of the Companys Common Stock immediately prior to
the merger have substantially the same proportionate ownership of common stock
of the surviving corporation immediately after the merger, or (B) any
sale, lease, exchange or other transfer (in one transaction or a series of
related transactions) of all or substantially all the assets of the Company, or
(ii) the stockholders of the Company shall approve any plan or proposal for the
liquidation or dissolution of the Company, or (iii) any person (as such term is
used in Sections 13(d) and 14(d)(2) of the Securities Exchange Act of
1934 (the Exchange Act)), other than the Company or any executive benefit
plan sponsored by the Company, or such person on the Effective Date hereof is a
20% or more beneficial owner, shall become the beneficial owner (within the
meaning of Rule 13d-3 under the Exchange Act) of securities of the Company
representing


20% or more of the combined voting power of the Companys then
outstanding securities ordinarily (and apart from rights accruing in special
circumstances) having the right to vote in the election of directors, as a
result of a tender or exchange offer, open market purchases, privately
negotiated purchases or otherwise, or (iv) at any time during a period of
two consecutive years, individuals who at the beginning of such period,
constituted the Board of Directors of the Company shall cease for any reason to
constitute at least a majority thereof, unless the election or the nomination
for election by the Companys stockholders of each new director during such
two-year period was approved by a vote of at least two-thirds of the directors
then still in office, who were directors at the beginning of such two-year
period.  5.6Rights and
Obligations.            If
a Change in Control of the Company shall have occurred while the Executive is
director of the Company, the Executive shall be entitled to the compensation
provided in Section 4.1 of this Agreement upon the subsequent termination
of this Agreement by either the Company, or the Executive within two years of
the date upon which the Change in Control shall have occurred, unless such
termination is a result of (i) the Executives death; (ii) the
Executives Disability; (iii) the Executives Retirement; or (iv) the
Executives termination for Cause.  6.Assignment.       This Agreement
shall be binding upon and inure to the benefit of the heirs and representatives
of Executive and the assigns and successors of Company, but neither this
Agreement nor any rights or obligations hereunder shall be assignable or
otherwise subject to hypothecation by Executive (except by will or by operation
of the laws of intestate succession or by Executive notifying the Company that
cash payment be made to an affiliated investment partnership in which Executive
is a control person) or by Company, except that Company may assign this
Agreement to any successor (whether by merger, purchase or otherwise) to all or
substantially all of the stock, assets or businesses of Company, if such
successor expressly agrees to assume the obligations of Company hereunder.  7.Indemnification.  Executive, as such and as a Director of the Company, shall be
indemnified by the Company against all liability incurred by the Executive in
connection with any proceeding, including, but not necessarily limited to, the
amount of any judgment obtained against Executive, the amount of any settlement
entered into by the Executive and any claimant with the approval of the
Company, attorneys fees, actually and necessarily incurred by him in
connection with the defense of any action, suit, investigation or proceeding or
similar legal activity, regardless of whether criminal, civil, administrative
or investigative in nature (Claim), to which he is made a party or is
otherwise subject to, by reason of his being or having been a director,
officer, agent or employee of the Company, to the full extent permitted by applicable
law and the Certificate of Incorporation of the Company..  Such right of indemnification will not be
deemed exclusive of any other rights to which Executive may be entitled under
Companys Certificate of Incorporation or By-laws, as in effect from time to
time, any agreement or otherwise.


8.General
Provisions.  8.5Modification: No
Waiver. No modification, amendment or discharge of this Agreement shall be
valid unless the same is in writing and signed by all parties hereto. Failure
of any party at any time to enforce any provisions of this Agreement or any
rights or to exercise any elections hall in no way be considered to be a waiver
of such provisions, rights or elections and shall in no way affect the validity
of this Agreement. The exercise by any party of any of its rights or any of
this elections under this Agreement shall not preclude or prejudice such party
from exercising the same or any other right it may have under this Agreement
irrespective of any previous action taken.  8.6Notices. All
notices and other communications required or permitted hereunder or necessary
or convenient in connection herewith shall be in writing and shall be deemed to
have been given when hand delivered or mailed by registered or certified mail
as follows (provided that notice of change of address shall be deemed given
only when received):  If to the Company, to:  Callisto Pharmaceuticals, Inc. 420 Lexington Avenue, Suite 1609 New York, NY 10170  If to Executive, to: Gary S. Jacob, Ph.D.  Or to such other names or addresses as the Company or Executive, as the
case may be, shall designate by notice to each other person entitled to receive
notices in the manner specified in this Section.  8.7Governing Law.
This Agreement shall be governed by and construed in accordance with the laws
of the State of New York.  8.8Further Assurances.
Each party to this Agreement shall execute all instruments and documents and
take all actions as may be reasonably required to effectuate this Agreement.  8.9Severability.
Should any one or more of the provisions of this Agreement or of any agreement
entered into pursuant to this Agreement be determined to be illegal or
unenforceable, then such illegal or unenforceable provision shall be modified
by the proper court or arbitrator to the extent necessary and possible to make
such provision enforceable, and such modified provision and all other
provisions of this Agreement and of each other agreement entered into pursuant
to this Agreement shall be given effect separately from the provisions or
portion thereof determined to be illegal or unenforceable and shall not be
affected thereby.  8.10Successors and Assigns.
Executive may not assign this Agreement without the prior written consent of
the Company. The Company may assign its rights without


the written consent of the executive, so long as the Company or its
assignee complies with the other material terms of this Agreement. The rights
and obligations of the Company under this Agreement shall inure to the benefit
of and be binding upon the successors and permitted assigns of the Company, and
the Executives rights under this Agreement shall inure to the benefit of and
be binding upon his heirs and executors. The Companys subsidiaries and
controlled affiliates shall be express third party beneficiaries of this
Agreement.  8.11Entire Agreement. This
Agreement supersedes all prior agreements and understandings between the
parties, oral or written. No modification, termination or attempted waiver
shall be valid unless in writing, signed by the party against whom such
modification, termination or waiver is sought to be enforced.  8.12Counterparts; Facsimile.
This Agreement may be executed in one or more counterparts, each of which shall
for all purposes be deemed to be an original, and all of which taken together
shall constitute one and the same instrument. This Agreement may be executed by
facsimile with original signatures to follow.  IN WITNESS WHEREOF, the undersigned, intending to be legally bound,
have executed this Agreement as of the date first written above.  EXECUTIVE:
  
  CALLISTO PHARMACEUTICALS, INC./s/ Gary S. Jacob
  
  /s/ Bernard DenoyerGary S. Jacob, Ph.D.
  
  Bernard Denoyer, Senior Vice President, Finance