**Exhibit 10.6**

 

October 15, 2002

Daniel J. Monticello, Ph.D.

152 N. Mill Trace

The Woodlands, TX 77381

 

Re:          Terminationof Employment Agreement

 

Dear Dr. Monticello:

 

This letter (the “Letter”) will reflect our agreementrelative to the termination of your employment agreement with EnchiraBiotechnology Corporation (the “Company”) and outline a number of practicaladministrative issues resulting therefrom as well as the potential sale ofcertain assets of the Company to you.

 

1.             EffectiveOctober 15, 2002, your Employment Agreement dated January 31, 1996, as amendedby that certain First Amendment to Employment Agreement dated April 10, 1998,as further amended by that certain Second Amendment to Employment Agreementdated April 9, 2001, as further amended by that certain Third Amendment toEmployment Agreement dated April 2, 2002, to be effective as of January 1,2002, and as further amended by that certain Fourth Amendment to EmploymentAgreement dated August 15, 2002 (collectively, the “Employment Agreement”) ishereby terminated.

 

2.             Notwithstandingthe termination of the Employment Agreement, you have agreed to remain apart-time employee of the Company on an as-needed basis in the same capacityuntil the first to occur of (i) a Sale (as defined below) or (ii) a Dissolution(as defined below).  Your duties shallinclude, but not be limited to, evaluating proposals relating to a merger orsale of all or substantially all of the remaining assets or capital stock ofthe Company (a “Sale”) and assisting with the dissolution and liquidation ofthe Company (a “Dissolution”), as well as certain administrative dutiesincluding, but not limited to, answering the Company’s telephone, collectingand processing the Company’s mail, and monitoring and responding to the Company’se-mail.

 

3.             Ascontemplated by Section 1.B of that certain Settlement and Release Agreementdated August 15, 2002 between you and the Company, the Company hereby releasesyou from the provisions of Section 5.6 of the Employment Agreement and expresslyagrees that you shall be permitted to engage in competitive activities as ofthe date hereof; provided, however, that except as provided in Paragraphs 4 and5 below, the remaining nondisclosure, inventions and confidentiality provisionsof Section 5 of the Employment Agreement shall continue to survive on the termsprovided therein and you shall continue to be bound by the terms thereof.  You hereby release the Company from any andall further obligations arising under the Employment Agreement.

 

4.             Asconsideration for all services to be rendered and performed pursuant to thisLetter, the Company agrees to assign or transfer to you those certain SBIRgrant applications (as

 

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more particularly described on Exhibit A hereto).  You acknowledge and agree that you will notbe paid any monetary fees in connection with your services provided pursuant tothis Letter.  Notwithstanding Paragraph3 above, the Company hereby releases you from any nondisclosure, inventions andconfidentiality provisions of Section 5 of the Employment Agreement applicableto the SBIR Grant applications.

 

5.             Inaddition to the above, the Company agrees to negotiate with you in good faithregarding the transfer or assignment of certain assets, intellectual property,technology and know-how relating to the Anti-Cancer Ligand (ACL) technology(specifically, IGF-I and EGF assays, enrichment and production methods, knowhow, customer/collaborator contact lists and the notebooks and reports(“bullets”) described on Exhibit B hereto) (the “Technology”) to you orto your subsequent employer (either one, the “Assignee”) on such terms as maybe mutually acceptable to the Company and to Assignee.  Notwithstanding Paragraph 3 above, in theevent the Company transfers and assigns the Technology to you, the Companyagrees to release you from any nondisclosure, inventions and confidentialityprovisions of Section 5 of the Employment Agreement applicable to theTechnology.  Notwithstanding the above,such transfer of the Technology to Assignee shall not be required in the eventthat there is a Sale of the Company or a sale of such Technology to a thirdparty which is approved by the Board of Directors of the Company.

 

6.             Nothingin this agreement shall be construed to grant you or your subsequent employerany rights, license or sublicense to any technology and/or materials that aresubject to arbitration and/or litigation with Maxygen, Inc. or any order orruling resulting therefrom.

 

Please sign below to acknowledge your receipt,understanding and agreement with all of the foregoing.

 
|                             | Sincerely,                        |
|----------------------------------|-----------------------------------|
|                             |                              |
|                             | Enchira Biotechnology Corporation |
|                             |                              |
|                             |                              |
|                             | By:                               |   | /s/ Paul G. Brown , III |   |
|                             | Name:                             |   | Paul G. Brown, III |   |
|                             | Title:                            |   | President |   |
|                             |
|                             |
| Acknowledged:                    |
|                             |
|                             |
|   /s/ D. J. Monticello |                              |
| Printed Name:                    |   D. J. Monticello      |   |
| Date:                            |   11/01/02              |   |
|                                  |                                   |  |  |  |  |  |  |  |  |

 

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Exhibit A

 

SBIR Grant Applications:

 

1.  Improving the activation of CPT-11 by hCE-2

 

NCI Grant #:  1 R43 CA96076

 

2. Creatingclinically relevant EGFR antagonists

 

NCI Grant # 1 R43 CA095930-01

 

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Exhibit B

 

Enchira Anti-Cancer Ligand Technology & Know How

 

1.             Enchira R&D2001-2002 “Bullets” related to IGF-I and EGF enrichments, assays and productionmethods.

 

2.             Enchira laboratorynotebooks:

 

340, 341, 343,344, 346, 347, 348, 349, 350, 351, 352, 353, 355, 356, 358, 359, 360, 361, 363,364, 365

 

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