exv10w23



 





Exhibit 10.23




January 28, 2008




James A. Merritt, M.D.

5285 Toscana Way, Apt. 8311

San Diego, California 92122




Re: Terms of Separation



Dear Jay:




     I appreciated the time you spent speaking with me about the terms of your separation from
ADVENTRX Pharmaceuticals, Inc. (the “Company”). This letter confirms the agreement between you and
the Company concerning the terms of your separation and offers you the separation compensation we
discussed in exchange for a release of claims (hereinafter this letter is referred to as this
“Agreement”). In this letter, you are referred to in the third person (“you”) or as “Executive.”



     1. Separation Date: January 29, 2008 is your last day of employment with the Company
(the “Separation Date”).



     2. Acknowledgment of Payment of Wages: By your signature below, you acknowledge that
on January 29, 2008, we provided you a final paycheck in the amount of $22,369.45 for all wages,
salary, bonuses, reimbursable expenses, accrued vacation and any similar payments due you from the
Company as of the Separation Date. By signing below, you acknowledge that the Company does not owe
you any other amounts.



     3. Separation Compensation: In exchange for your agreement to the waiver and release
of claims set forth in paragraph 7, below, the Company agrees to:



     (a) commencing on the first standard Company payroll date following the effective date of this
Agreement (as defined in paragraph 12, below), pay you an amount equal to 6 months of your current
base salary, less applicable state and federal payroll deductions, in substantially equal
installments in accordance with the Company’s standard payroll practices over the Company’s 13 pay
periods following the effective date of this Agreement (as defined in paragraph 12, below);



     (b) pay you $16,037.68, less applicable state and federal payroll deductions, which the
parties agree satisfies in full the Company’s obligation set forth in your offer letter, dated
September 7, 2006, to pay all costs that the Company would otherwise have incurred to maintain your
health, welfare and retirement benefits if you had continued for 6 continuous months after your
Separation Date. The Company will pay the amount set forth in this paragraph 3(b) in



 









 







substantially equal installments commencing on and continuing in accordance with the same
schedule described in paragraph 3(a);



     (c) accelerate vesting and extend the time to exercise vested shares of your stock option
granted on September 27, 2006 (the “2006 Option”), as follows: The 2006 Option granted you an
option to purchase up to 300,000 shares of the Company’s common stock at a price of $2.86 per
share. Your right to purchase these shares was subject to a vesting schedule and, immediately
prior to the Separation Date, the 2006 Option was vested as to 100,000 shares and unvested as to
200,000 shares. In exchange for your agreement to the waiver and release of claims set forth in
paragraph 7, below, the Company agrees to: (A) accelerate vesting as to 31,249 of the unvested
shares, which would result in the 2006 Option being vested as to a total of 131,249 shares; and,
(B) extend the time for you to exercise the vested shares under the 2006 Option to Noon (Pacific)
on December 31, 2008. To effect the foregoing, the parties agree that Section 3(a)(ii) of the 2006
Option Agreement is hereby amended and restated in its entirety as follows and acknowledge that
such amendment may result in a new grant date for incentive stock option purposes:




          “(ii) In the event of Optionee’s death, disability or other termination of
Optionee’s Continuous Service, the Option shall be exercisable in the manner and to
the extent provided in Section 6.3 of the Plan; provided, however, that, anything in
Section 6.3(a)(i) to the contrary notwithstanding but subject to Optionee’s timely
execution of a release of claims against the Company, in the form provided by the
Company, and Optionee’s not revoking such release, in the event of an Involuntary
Termination, the Option shall remain exercisable until Noon (Pacific) on December
31, 2008.”



     By signing below, you acknowledge that you are receiving the separation compensation outlined
in this paragraph 3 in consideration for waiving and releasing your rights to claims referred to in
this Agreement and that you would not otherwise be entitled to such separation compensation.



     4. January 12, 2007 Stock Option: Please note that this Agreement does not change the
terms of the stock option granted to you on January 12, 2007 (the “2007 Option”). As of the
Separation Date, the 2007 Option was vested as to 8,334 shares and unvested as to 24,999 shares.
As a result of the termination of your employment, vesting has discontinued and none the unvested
shares will vest. You have 90 days from the Separation Date to exercise the 2007 Option as to the
vested shares.



     5. Return of Company Property: You hereby warrant to the Company that you have
returned to the Company all property or data of the Company of any type whatsoever that has been in
your possession or control.



     6. Confidentiality Agreement: You hereby acknowledge that you are bound by your
Confidential Information, Non-Solicitation and Invention Assignment Agreement for Employees with
the Company, dated September 7, 2006 (the “Confidentiality Agreement”), a copy of which has been
provided to you, that as a result of your employment with the Company you have had access to
Confidential Information (as defined in the Confidentiality Agreement), that you will



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hold all Confidential Information in strictest confidence and that you will not make use of
such Confidential Information on behalf of anyone. You further confirm that you have delivered to
the Company all documents and data of any nature containing or pertaining to Confidential
Information and that you have not taken with you any such documents or data or any reproduction
thereof.



     7. Executive’s Release of Company:



     (a) On Executive’s own behalf and on behalf of Executive’s heirs, estate and beneficiaries,
Executive hereby waives, releases, acquits and forever discharges the Company, and each of its
parents, subsidiaries and affiliates, and each of their respective past or present officers,
directors, agents, servants, employees, shareholders, predecessors, successors and assigns, and all
persons acting by, through, under, or in concert with them, or any of them (hereinafter “Company
Releasees”), of and from any and all suits, debts, liens, contracts, agreements, promises, claims,
liabilities, demands, causes of action, costs, attorneys’ fees, damages, and obligations of every
kind and nature, in law, equity, or otherwise, known and unknown, fixed or contingent, suspected
and unsuspected, disclosed and undisclosed (“Claims”), from the beginning of time to the date
hereof, including without limitation, Claims that arose as a consequence of Executive’s employment
with the Company, or arising out of the termination of such employment relationship, or arising out
of any act committed or omitted during or after the existence of such employment relationship, all
up through and including the date on which this Agreement is executed, including, but not limited
to, Claims which were, could have been, or could be the subject of an administrative or judicial
proceeding filed by Executive or on Executive’s behalf under federal, state or local law, whether
by statute, regulation, in contract or tort. This waiver and release includes, but is not limited
to: (1) Claims for intentional and negligent infliction of emotional distress; (2) tort Claims for
personal injury; (3) Claims or demands related to stock, stock options, or any other ownership
interest in the Company, or fringe benefits; (4) Claims for breach of contract; (5) Claims for any
form of retaliation, harassment, or discrimination; (6) Claims pursuant to any federal, state or
local law or cause of action including, but not limited to, Title VII of the Civil Rights Act of
1964, as amended, the federal Age Discrimination in Employment Act of 1967, as amended (“ADEA”),
the federal Americans with Disabilities Act of 1990, the California Fair Employment and Housing
Act, as amended; and (7) all other Claims based on tort law, contract law, statutory law, common
law, wrongful discharge, constructive discharge, fraud, defamation, emotional distress, pain and
suffering, breach of the implied covenant of good faith and fair dealing, compensatory or punitive
damages, interest, attorneys’ fees, and reinstatement or re-employment.



     (b) Notwithstanding the foregoing, nothing in the waiver and release set forth in this
paragraph 7 shall constitute a release by Executive of any claims or damages based on any right
Executive may have to enforce the Company’s executory obligations under the your offer letter,
dated September 7, 2006, the agreement evidencing the 2006 Option or the agreement evidencing the
2007 Option, any right Executive may have to vested or earned compensation and benefits, or
Executive’s eligibility for indemnification under applicable law, Company governance documents,
Executive’s indemnification agreement with the Company or under any applicable insurance policy
with respect to Executive’s liability as an employee or officer of the Company. Furthermore,
notwithstanding anything to the contrary in this paragraph 7, the waiver



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and release set forth in this paragraph 7 does not extend to any rights which as a matter of
law cannot be waived or released.



     (c) Executive represents that he has not filed or otherwise pursued any charges, complaints or
claims of any nature which are in any way pending against the Company or any of the Company
Releasees with any court with respect to any matter covered by the waiver and release set forth in
this paragraph 7 and agrees, to the extent permitted by law, that he will not do so in the future.
Executive further represents that, with respect to any charge, complaint or claim he has filed or
otherwise pursued or will file or otherwise pursue in the future with any state or federal agency
against the Company or any of the the Company Releasees, he will forgo any monetary damages,
including but not limited to compensatory damages, punitive damages, and attorneys’ fees, to which
he may otherwise be entitled in connection with said charge, complaint or claim. Nothing in the
waiver and release set forth in this paragraph 7 shall limit Executive’s right to file a charge,
complaint or claim with any state or federal agency or to participate or cooperate in such matters.



     8. Company’s Release of Executive:



     (a) The Company, for itself and each of its parents subsidiaries and affiliates and each of
their respective predecessors successors and assigns over which the Company has control and the
right to release Executive as set forth herein, hereby waives, releases, acquits and forever
discharges Executive and Executive’s heirs, estate and beneficiaries, and all persons acting by,
through, under, or in concert with them, or any of them (hereinafter “Executive Releasees”), of and
from any and all Claims, from the beginning of time to the date hereof, including without
limitation, Claims that arose as a consequence of Executive’s employment with the Company, or
arising out of the termination of such employment relationship, or arising out of any act committed
or omitted during or after the existence of such employment relationship, all up through and
including the date on which this Agreement is executed, including, but not limited to, Claims which
were, could have been, or could be the subject of an administrative or judicial proceeding filed by
the Company or on the Company’s behalf under federal, state or local law, whether by statute,
regulation, in contract or tort. This release includes, but is not limited to: (1) Claims for
intentional and negligent infliction of emotional distress; (2) tort Claims for personal injury;
(3) Claims or demands related to salary, bonuses, commissions, stock, stock options, or any other
ownership interest in the Company, vacation pay, fringe benefits, expense reimbursements, severance
pay, front pay, back pay or any other form of compensation; (4) Claims for breach of contract;
(5) Claims for any form of retaliation, harassment, or discrimination; (6) Claims pursuant to any
federal, state or local law or cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended, the ADEA, the federal Americans with Disabilities Act of 1990, the
California Fair Employment and Housing Act, as amended; and (7) all other Claims based on tort law,
contract law, statutory law, common law, wrongful discharge, constructive discharge, fraud,
defamation, emotional distress, pain and suffering, breach of the implied covenant of good faith
and fair dealing, compensatory or punitive damages, interest, attorneys’ fees, and reinstatement or
re-employment. Furthermore, notwithstanding anything to the contrary in this paragraph 8, the
waiver and release set forth in this paragraph 8 does not extend to any rights which as a matter of
law cannot be waived or released.



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     (b) The Company represents that it has not filed or otherwise pursued any charges, complaints
or claims of any nature which are in any way pending against Executive or any of the Executive
Releasees with any court with respect to any matter covered by the waiver and release set forth in
this paragraph 8 and agrees, to the extent permitted by law, that it will not do so in the future.
The Company further represents that, with respect to any charge, complaint or claim it has filed or
otherwise pursued or will file or otherwise pursue in the future with any state or federal agency
against Executive or any of the the Executive Releasees, it will forgo any monetary damages,
including but not limited to compensatory damages, punitive damages, and attorneys’ fees, to which
it may otherwise be entitled in connection with said charge, complaint or claim. Nothing in the
waiver and release set forth in this paragraph 8 shall limit the Company’s right to file a charge,
complaint or claim with any state or federal agency or to participate or cooperate in such matters.



     9. Section 1542 Waiver: The parties acknowledge that each has read and understands
Section 1542 of the California Civil Code which reads as follows: “A general release does not
extend to claims which the creditor does not know or suspect to exist in his or her favor at the
time of executing the release, which if known by him or her must have materially affected his or
her settlement with the debtor.” The parties hereby expressly waive and relinquish all rights and
benefits under that section and any law of any jurisdiction of similar effect with respect to the
release by each party of any unknown Claims either party may have against the other party.



     10. Entire Agreement: This agreement constitutes the entire agreement between you and
the Company with respect to the subject matter hereof and supersedes all prior negotiations and
agreements, whether written or oral, relating to such subject matter other than the Confidentiality
Agreement referred to in paragraph 6, above. You acknowledge that none of the Company Releasees nor
any of their agents or attorneys have made any promise, representation or warranty whatsoever,
either express or implied, written or oral, which is not contained in this Agreement for the
purpose of inducing you to execute the agreement, and you acknowledge that you have executed this
Agreement in reliance only upon such promises, representations and warranties as are contained
herein.



     11. Modification: It is expressly agreed that this Agreement may not be altered,
amended, modified, or otherwise changed in any respect except by another written agreement that
specifically refers to this Agreement, executed by authorized representatives of each of the
parties to this Agreement.



     12. Satisfaction of Older Workers Benefits Protection Act Requirements: Executive
acknowledges that he is knowingly and voluntarily waiving and releasing any rights he may have
under the Age Discrimination in Employment Act and other laws as set forth in paragraph 7, above.
Executive also acknowledges that the consideration given for the waiver and release set forth in
paragraph 7 is in addition to anything of value to which he was already entitled. Executive further
acknowledges that he has been advised by this writing, as required by the Older Workers Benefits
Protection Act, that: (A) his waiver and release in paragraph 7 does not apply to any rights or
claims that may arise on or after the date he executes this Agreement; (B) Executive is advised to
consult with an attorney prior to executing this Agreement;



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(C) Executive has 21 days to consider this Agreement (although he may choose to
voluntarily execute this Agreement earlier) starting as of when his termination becomes effective
on January 29, 2008; (D) Executive has 7 days following the execution of this Agreement to revoke
this Agreement; and (E) this Agreement shall not be effective until the date upon which the
revocation period has expired, which shall be the 8th day after this Agreement is executed by
Executive, without Executive’s having given notice of revocation.




     13. Review of Agreement: Each party to this Agreement further acknowledges that such
party has carefully read this Agreement (in particular the provisions of paragraph 7), and knows
and understands its contents and its binding legal effect. Each party acknowledges that by signing
this Agreement, such party does so of such party’s own free will, and that it is such party’s
intention to be legally bound by its terms.



     If you agree with and agree to abide by the terms and conditions outlined in this letter,
please sign this letter below and also sign the attached copy and return it to me. I wish you the
best in your future endeavors.



	 	 	 	 	 
	 	Sincerely,





ADVENTRX Pharmaceuticals, Inc.

 	 
	 	By:  	/s/ Evan M. Levine
 	 
	 	 	Evan M. Levine 	 
	 	 	Chief Executive Officer 	 
	 



READ, UNDERSTOOD AND AGREED:




	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	Signature:

	 	/s/ James A. Merritt
	 	 
	 	Date:
	 	Feb 04, 2008	 	 
	 

	 	 

James A. Merritt
	 	 
	 	 	 	 

	 	 





Note: You may not sign or accept the agreement set forth in this letter before your
termination has become effective on January 29, 2008.





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