Exhibit
10.3


 


EMPLOYMENT AGREEMENT


 


THIS
EMPLOYMENT AGREEMENT (the “Agreement”) is made and
entered into effective as of October 1, 2003, by and between Maxim
Pharmaceuticals, Inc., (the “Company”), and Anthony E. Altig
(“Executive”).  The Company and Executive
are hereinafter collectively referred to as the “Parties,” and individually
referred to as a “Party.”


 


RECITALS


 


A.                                    The
Company desires assurance of the association and services of Executive in order
to retain Executive’s experience, skills, abilities, background and knowledge,
and is willing to engage Executive’s services on the terms and conditions set
forth in this Agreement.


 


B.                                    Executive
desires to be in the employ of the Company, and is willing to accept such
employment on the terms and conditions set forth in this Agreement.


 


AGREEMENT


 


In consideration of the foregoing recitals and the mutual promises and
covenants herein contained, and for other good and valuable consideration, the
Parties, intending to be legally bound, agree as follows:


 


1.                                       EMPLOYMENT.


 


1.1                                 The Company hereby
employs Executive, and Executive hereby accepts continued employment by the
Company, upon the terms and conditions set forth in this Agreement, effective
as of the date first set forth above (“Commencement Date”).  This Agreement shall continue in effect
until terminated pursuant to Section 5 below.


 


1.2                                 Executive shall be the
Vice-President, Finance, Chief Financial Officer and Corporate Secretary of the
Company (or a position of at least comparable status) and shall serve in such
other capacity or capacities as the Chief Executive Officer and/or the
Company’s Board of Directors (“Board”) may from time to time prescribe.


 


1.3                                 Executive shall do and
perform all services, acts or things necessary or advisable to manage and conduct
the business of the Company, which are (i) consistent with the Bylaws of the
Company and (ii) subject to the direction and policies from time to time
established by the Board and/or the Chief Executive Officer.


 


1.4                                 Unless the Parties
otherwise agree in writing, during the term of this Agreement, Executive shall
perform the services he is required to perform pursuant to this Agreement at
the Company’s offices, located at 8899 University Center Lane, Suite 400 or at
any other place at which the Company maintains an office; provided, however,
that the Company may from time to time require Executive to travel temporarily
to other locations in connection with the Company’s business.


 

















 


2.                                       LOYAL
AND CONSCIENTIOUS PERFORMANCE; NONCOMPETITION.


 


2.1                                 During his employment
by the Company, Executive shall devote his full business energies, interest,
abilities and productive time to the proper and efficient performance of his
duties under this Agreement.


 


2.2                                 During the term of
this Agreement, Executive shall not engage in competition with the Company,
either directly or indirectly, in any manner or capacity, as adviser,
principal, agent, partner, officer, director, employee, member of any
association or otherwise, in any phase of the business of developing, manufacturing
and marketing of products which are in the same field of use or which otherwise
compete with the products or proposed products of the Company.


 


2.3                                 Ownership by
Executive, as a passive investment, of less than one percent (1%) of the
outstanding shares of capital stock of any corporation with one or more classes
of its capital stock listed on a national securities exchange or publicly
traded in the over-the-counter market shall not constitute a breach of this
paragraph.


 


3.                                       COMPENSATION
OF EXECUTIVE.


 


3.1                                 While employed by the
Company, as compensation for proper and satisfactory performance of all duties
to be performed hereunder, the Company shall pay Executive an annual base
salary of Two Hundred Thirty Five Thousand Dollars, $235,000 per year (the
“Base Salary”), payable in regular periodic payments in accordance with Company
policy.  Such salary shall be prorated
for any partial year of employment on the basis of a 365-day fiscal year.  In addition, Executive will be eligible for
an incentive bonus of up to 25% of base salary, based upon defined milestones.


 


3.2                                 Executive’s
compensation may be changed from time to time by mutual agreement of Executive
and the Board.


 


3.3                                 All of Executive’s
compensation shall be subject to customary withholding taxes and any other
employment taxes as are commonly required to be collected or withheld by the
Company.


 


3.4                                 Executive shall be
entitled to vacation and illness days consistent with the Company’s standard
practice for its employees generally.


 


3.5                                 Executive
shall, at the discretion of the Board, be entitled to participate in the
benefits for which he is eligible under the terms and conditions of the
standard Company benefits which may be in effect from time to time and provided
by the Company.


 


4.                                       EXPENSE REIMBURSEMENT.


 


4.1                                 Executive shall be
entitled to receive prompt reimbursement of all reasonable business and travel
expenses incurred by Executive in connection with the business of the
Company.  Such expenses must be properly
accounted for under the policies and procedures established by the Company.


 


5.                                       TERMINATION.


 


5.1                                 The Company may
terminate Executive’s employment under this Agreement “for cause” by delivery
of written notice to Executive specifying the cause or causes relied upon for
such termination.  Any notice of
termination delivered pursuant to this Section 5.1 shall effect


 


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termination as of the date specified in such notice or, in the event no
such date is specified, on the last day of the month in which such notice is
delivered or deemed delivered as provided in Section 9 below.  If Executive’s employment under this
Agreement is terminated by the Company for cause under this section, Executive
shall be entitled to receive only accrued Base Salary and other accrued
benefits required by law, prorated to the date of termination.  Executive will not be entitled to severance
pay, pay in lieu of notice or any other such compensation.  Grounds for the Company to terminate this
Agreement “for cause” shall be limited to the occurrence of any of the
following events:


 


5.1.1                        Executive’s
material breach of any provision of this Agreement;


 


5.1.2                        Executive’s
engaging or in any manner participating in any activity which is competitive
with or intentionally injurious to the Company or which violates any provision
of Section 7 of this Agreement;


 


5.1.3                        Executive’s
commission of any fraud against the Company or use or appropriation for his
personal use or benefit of any funds or properties of the Company;


 


5.1.4                        Executive’s
conviction of any crime involving dishonesty or moral turpitude;


 


5.1.5                        Conduct by
Executive which in good faith and reasonable determination of the Board
demonstrates gross unfitness to serve.


 


Any notice of termination given pursuant to this Section 5.1 shall
effect termination as of the date specified in such notice or, in the event no
such date is specified, on the last day of the month in which such notice is
delivered or deemed delivered as provided in Section 9 below.


 


5.2                                 The
Company may terminate the Executive’s employment at any time without cause upon
delivery of written notice to the Executive. 
Any notice of termination given pursuant to this Section 5.2 shall
effect termination as of the date specified in such notice or, in the event no
such date is specified, on the last day of the month in which such notice is
delivered or deemed delivered as provided in Section 9 below.  If such termination shall occur under this
Section 5.2, then in lieu of all other remedies, and upon the Executive’s
furnishing to the Company an effective waiver and release of claims (in a form
acceptable to the Company), Executive shall be entitled to continuation of Base
Salary and health benefits for a period of six (6) months from said date of
termination with such Base Salary continuation to be at the rate set forth in
Section 3.1 or, if greater, at the rate of Executive’s then current salary
in effect as of the date of termination.


 


5.3                                 The parties may
mutually agree at any time to terminate this Agreement upon such terms and
conditions as may be agreed upon in writing.


 


5.4                                 This
Agreement shall terminate without notice upon the date of Executive’s death or
the date when Executive becomes “completely disabled” as that term is defined
in Section 6.2.  In the event of
termination due to death or complete disability, Executive or his estate or
personal representative, as the case may be, shall be entitled to receive only
accrued Base Salary and other accrued benefits required by law, prorated to the
date of Executive’s death or the date when Executive becomes completely
disabled.


 


5.5                                 Notwithstanding any
provision to the contrary herein, unless otherwise provided herein or unless
otherwise provided by law, Executive may at any time terminate his employment with
the Company hereunder.  In such event,
the Company shall not be liable to Executive for the


 


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payment of any amount other than accrued Base Salary and other accrued
benefits required by law, prorated to the date of termination.  The effective date of termination of
Executive’s employment under this Section 5.5 shall be determined by the
Board upon its receipt of notice of such termination.  Executive will not be entitled to severance pay, pay in lieu of
notice or any other such compensation.


 


6.                                       DEATH
OR DISABILITY DURING TERM OF EMPLOYMENT.


 


6.1                                 Upon termination of
Executive’s employment pursuant to Section 5.4, Executive or his estate or
personal representative, as the case may be, shall be entitled to receive
Executive’s Base Salary and benefits for a period of one month following the
date of death or the date when Executive becomes completely disabled.


 


6.2                                 The term “completely
disabled” as used in this Agreement shall mean the inability of Executive to
perform the essential functions of his position under this Agreement by reason
of any incapacity, physical or mental, which the Board of the Company, based
upon medical advice or an opinion provided by a licensed physician acceptable
to the Board of the Company and approved by the Executive, which approval shall
not be unreasonably withheld, determines to have incapacitated Executive from
satisfactorily performing any or all essential functions of his position for
the Company during the foreseeable future. 
Based upon such medical advice or opinion, the determination of the
Board of the Company shall be final and binding and the date such determination
is made shall be the date of such complete disability for purposes of this
Agreement.


 


7.                                       CONFIDENTIAL
INFORMATION; NONSOLICITATION.


 


7.1                                 Executive recognizes
that his employment with the Company will involve contact with information of
substantial value to the Company, which is not generally known in the trade,
and which gives the Company an advantage over its competitors who do not know
or use it, including but not limited to, techniques, designs, drawings,
processes, inventions, developments, equipment, prototypes, sales and customer
information, and business and financial information relating to the business,
products, practices and techniques of the Company (hereinafter referred to as
“Confidential Information”).  Executive
will at all times regard and preserve as confidential such Confidential
Information obtained by Executive from whatever source and will not, either
during his employment with the Company or thereafter, publish or disclose any
part of such Confidential Information in any manner at any time, or use the
same except on behalf of the Company, without the prior written consent of the
Company.  As a condition of this
Agreement, Executive will sign and return a copy of the Company’s “Proprietary
Information and Inventions Agreement,” attached as Exhibit A.


 


7.2                                 While employed by the
Company and for one (1) year thereafter, the Executive agrees that in order to
protect the Company’s confidential and proprietary information from
unauthorized use, that Executive will not, either directly or through others,
solicit or attempt to solicit any employee, consultant or independent
contractor of the Company to terminate his or her relationship with the Company
in order to become an employee, consultant or independent contractor to or for
any other person or business entity; or the business of any customer, vendor or
distributor of the Company which, at the time of termination or one (1) year
immediately prior thereto, was listed on Company’s customer, vendor or
distributor list.


 


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8.                                       ASSIGNMENT
AND BINDING EFFECT.


 


8.1                                 This Agreement shall
be binding upon and inure to the benefit of Executive and Executive’s heirs,
executors, personal representatives, assigns, administrators and legal
representatives.  Because of the unique
and personal nature of Executive’s duties under this Agreement, neither this
Agreement nor any rights or obligations under this Agreement shall be
assignable by Executive.  This Agreement
shall be binding upon and inure to the benefit of the Company and its
successors, assigns and legal representatives.


 


9.                                       NOTICES.


 


9.1                                 All notices or demands
of any kind required or permitted to be given by the Company or Executive under
this Agreement shall be given in writing and shall be personally delivered (and
receipted for) or mailed by certified mail, return receipt requested, postage
prepaid, addressed as follows:


 


	
  9.1.1

  	
   

  	
  If to the Company:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Larry Stambaugh

  
	
   

  	
   

  	
  Maxim
  Pharmaceuticals, Inc.

  
	
   

  	
   

  	
  8899 University Center Lane

  
	
   

  	
   

  	
  Suite 400

  
	
   

  	
   

  	
  San Diego, CA  92122

  
	
   

  	
   

  	
   

  
	
  9.1.2

  	
   

  	
  If to Executive:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Anthony E. Altig

  
	
   

  	
   

  	
  Maxim
  Pharmaceuticals, Inc.

  
	
   

  	
   

  	
  8899 University Center Lane

  
	
   

  	
   

  	
  Suite 400

  
	
   

  	
   

  	
  San Diego, CA  92122

  



 


Any such written notice shall be deemed received when personally
delivered or three (3) days after its deposit in the United States mail as
specified above.  Either Party may
change its address for notices by giving notice to the other Party in the
manner specified in this section.


 


10.                                 CHOICE OF LAW.


 


10.1                           This Agreement is made in
San Diego, California.  This Agreement
shall be construed and interpreted in accordance with the laws of the State of
California.


 


11.                                 INTEGRATION.


 


11.1                           This Agreement contains the
complete, final and exclusive agreement of the Parties relating to the subject
matter of this Agreement, and supersedes all prior oral and written employment
agreements or arrangements between the Parties.


 


12.                                 AMENDMENT.


 


12.1                           This Agreement cannot be
amended or modified except by a written agreement signed by Executive and the
Company.


 


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13.                                 WAIVER.


 


13.1                           No term, covenant or
condition of this Agreement or any breach thereof shall be deemed waived,
except with the written consent of the Party against whom the wavier in
claimed, and any waiver or any such term, covenant, condition or breach shall
not be deemed to be a waiver of any preceding or succeeding breach of the same
or any other term, covenant, condition or breach.


 


14.                                 SEVERABILITY.


 


14.1                           The finding by a court of
competent jurisdiction of the unenforceability, invalidity or illegality of any
provision of this Agreement shall not render any other provision of this
Agreement unenforceable, invalid or illegal. 
Such court shall have the authority to modify or replace the invalid or
unenforceable term or provision with a valid and enforceable term or provision
which most accurately represents the parties’ intention with respect to the
invalid or unenforceable term or provision.


 


15.                                 INTERPRETATION; CONSTRUCTION.


 


15.1                           The headings set forth in
this Agreement are for convenience of reference only and shall not be used in
interpreting this Agreement.  This
Agreement has been drafted by legal counsel representing the Company, but
Executive has been encouraged, and has consulted with, his own independent
counsel and tax advisors with respect to the terms of this Agreement.  The Parties acknowledge that each Party and
its counsel has reviewed and revised, or had an opportunity to review and
revise, this Agreement, and the normal rule of construction to the effect that
any ambiguities are to be resolved against the drafting party shall not be employed
in the interpretation of this Agreement.


 


16.                                 REPRESENTATIONS AND WARRANTIES.


 


16.1                           Executive represents and
warrants that he is not restricted or prohibited, contractually or otherwise,
from entering into and performing each of the terms and covenants contained in
this Agreement, and that his execution and performance of this Agreement will
not violate or breach any other agreements between Executive and any other
person or entity.


 


17.                                 COUNTERPARTS.


 


17.1                           This Agreement may be
executed in two counterparts, each of which shall be deemed an original, all of
which together shall contribute one and the same instrument.


 


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IN
WITNESS WHEREOF, the Parties have executed this
Agreement as of the date first above written.


 


	
   

  	
  The Company:

  
	
   

  	
   

  
	
   

  	
  MAXIM
  PHARMACEUTICALS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:  /s/ Larry G. Stambaugh

  
	
   

  	
  Larry G. Stambaugh

  
	
   

  	
  Chairman of the Board, President and Chief

  Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Anthony E. Altig

  
	
   

  	
  Anthony E. Altig

  



 


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