Document:

Exhibit 10.8

 

	
  April 18,
  2003

  	
  BY
  FEDERAL EXPRESS

  

 

Daniel C. Adelman, M.D.

 

Dear Dan:

 

On behalf of Sunesis Pharmaceuticals, Inc. (the “Company”),
I am delighted to offer you the position of Senior Vice President of Clinical
Development.  Speaking for myself, as
well as the other members of the Company’s Management and Board of Directors,
we look forward to working with you and to your future success with the
Company.

 

The terms of your new
position with the Company are as set forth below:

 

1.                                      Position.

 

a.                                       You
will become Senior Vice President of Clinical Development of the Company,
working in the Company’s facility in South San Francisco and initially
reporting to the CEO.

 

You agree to the best of your ability and experience
that you will at all times loyally and conscientiously perform all of the
duties and obligations required of and from you pursuant to the express and
implicit terms hereof.  During the term
of your employment, you further agree that you will devote all of your business
time and attention to the business of the Company, the Company will be entitled
to all of the benefits and profits arising from or incident to all such work
services and advice, you will not render commercial or professional services of
any nature to any person or organization, whether or not for compensation,
without the prior consent of the Company’s Board of Directors, and you will not
directly or indirectly engage or participate in any business that is
competitive in any manner with the business of the Company.  Nothing in this letter agreement will prevent
you from accepting speaking or presentation engagements in exchange for
honoraria or from serving on boards of charitable organizations or otherwise
participating in civic, charitable or fraternal organizations or from owning no
more than one percent (1%) of the outstanding equity securities of a
corporation whose stock is listed on a national stock exchange.  Further, you are encouraged to continue your
clinical medical practice at a rate of up to one (1) day every two (2) weeks.

 

1

 

2.                                       Start Date.   Subject to fulfillment of any conditions
imposed by this letter agreement, you will begin full time employment with the
Company not later than May 27, 2003.

 

3.                                       Compensation.

 

a.                                       Base Salary.  You will be paid a monthly salary of
$19,166.66 which is equivalent to $230,000 on an annualized basis.  Your salary will be payable in two equal
payments per month pursuant to the Company’s regular payroll policy.  Your base salary will be reviewed annually
for adjustment based on cost of living and merit, at the discretion of the
Board of Directors.

 

4.                                       Stock Options.

 

In
connection with the commencement of your employment, the Company will recommend
to the Board of Directors of Sunesis Pharmaceuticals, Inc. that you be granted
an option pursuant to the 1998 Stock Option Plan (the “Plan”) to purchase
200,000 Shares of Common Stock (the “Options”). 
The stock vests over a four-year period. 
The first 25% of the stock vests after one year, and the rest of the
shares vest in monthly increments thereafter. 
The Options may be exercised prior to vesting by paying to the Company
the exercise price for the Shares being purchased, and (ii) entering into a standard
form of restricted stock purchase agreement with the Company.

 

5.                                       Benefits.

 

a.                                       Insurance Benefits.  Once you begin full time employment with the
Company, you will be eligible to participate in our employee benefits program,
which includes medical, dental, life, vision and long term disability.  You will be eligible to participate in the
401(k) retirement program the first of the month following three full months of
employment.  In addition, the Company
currently indemnifies all officers and directors to the maximum extent
permitted by law, and you will be requested to enter into the Company’s
standard form of Indemnification Agreement giving you such protection.  Pursuant to the Indemnification Agreement,
the Company will agree to advance any expenses for which indemnification is
available to the extent allowed by applicable law.

 

b.                                      Vacation.  You will be entitled to three weeks paid
vacation per year, which accrues on a semi-monthly basis.

 

6.                                       Confidential Information and Invention Assignment
Agreement.  Your
acceptance of this offer and commencement of employment with the Company is
contingent upon the execution of the Company’s Confidential Information and
Invention Assignment Agreement, a copy of which is enclosed for your review and
execution prior to your start date.

 

2

 

7.                                       Confidentiality of Terms.  You agree to follow the Company’s strict
policy that employees must not disclose, either directly or indirectly, any
information, including any of the terms of this agreement, regarding salary or
stock purchase or option allocations to any person, including other employees
of the Company; provided, however, that you may discuss such terms with the
members of your immediate family and any legal, tax or accounting specialists
who provide you with individual legal, tax or accounting advice, and you may
discuss it with other employees of the Company on a need to know basis if
required to carry out your duties as the Company’s Senior Vice President of
Clinical Development.

 

8.                                       Employment Eligibility.  In accordance with Federal Law, all new
employees are required to present evidence of their eligibility to be employed
in the United States.  Accordingly, we
request that you provide us with originals of the appropriate documents for
this purpose.  A list of the documents
deemed acceptable is included on the reverse of the I-9 Form, which is included
in this letter.  Please bring the
completed I-9 form and appropriate documents with you to your new-hire
orientation.

 

9.                                       At-Will Employment.  Your relationship with the Company will be
at-will, as defined under applicable law, meaning that either the Company or
you may terminate the Relationship at any time for any reason or no reason,
without further obligation or liability.

 

a.                                       In
addition, if you are terminated by the Company without “cause,” as defined
below (other than by reason of Disability), then:

 

(i)                                     your
annual base salary will continue to be paid in accordance with the Company’s
standard payroll policies until the earlier of (A) twelve (12) months following
the date of termination (nine (9) months if the date of termination is more
than twelve (12) months following your Start Date), or (B) your acceptance of
other full-time employment at an equal or greater base salary.  If you obtain full time employment at an
annualized base salary less than the annualized base salary you were entitled
to at the Company, then the Company will pay you the difference in monthly base
salary on a monthly basis until the end of the Company’s severance
obligation.  You shall have no obligation
to obtain other employment during the severance payment period;

 

(ii)                                  you
will continue to receive benefits pursuant to the Company’s Benefit Plans,
provided that such Benefit Plans permit continuation post-termination by
payment of State or Federal COBRA premiums, at the Company’s expense until the
earlier of (A) twelve (12) months following the date of termination, or (B) you
are no longer eligible for State or Federal COBRA;

 

(iii)                               the
number of Shares vested shall be measured as if the termination occurred twelve
(12) months after the actual date of termination; and

 

(iv)                              Upon
a change of control (as defined below) of the Company, you shall be entitled to
the benefits described in subparagraphs (i), (ii), and (iii) above if you

 

3

 

terminate employment because of Effective Termination.  “Effective Termination” shall mean:  (A) without your express written consent, a
significant reduction of your duties, position or responsibilities; or (B)
without your express written consent, a material reduction by the Company of
your base salary; or (C) a reduction by the Company in the kind or level of
your benefits to which you are entitled with the result that your overall
benefits package is significantly reduced; or (D) without your express written
consent, the relocation of you to a facility or location more than one hundred
(100) miles from the Company’s current facility.  In addition, vesting of the unvested portion
of the Options or the Company’s right to repurchase stock under the stock
purchase agreement entered into upon exercise of the Options shall
automatically be accelerated (or in the case of the right of repurchase, shall
lapse) so that such Options (or shares, as applicable) shall become completely
vested.  For the purposes of this Section 9(a)(iv),
“Change of Control” shall mean a merger or reorganization of the Company with
or into any other corporation or corporations, or a sale of all or
substantially all of the assets of the corporation, or a sale of securities of
the Company, in which transaction the Company’s stockholders immediately prior
to such transaction own immediately after such transaction less than 50% of the
equity securities of the surviving corporation or its parent.  Notwithstanding the foregoing, if it is
determined by the Company’s independent public accountants that such
accelerated vesting would preclude accounting for the change of control as a
pooling of interests for financial accounting purposes, and it is a condition
to the closing of the change of control that the transaction be accounted for
as a pooling of interests, then the accelerated vesting shall not occur
pursuant to this section (iv) but shall be accelerated at the earliest
time which will not preclude accounting as a pooling of interests.

 

(v)                                 Your
stock option agreement and/or stock purchase agreement will reflect the vesting
acceleration and change of control provisions recited in this Agreement.

 

b.                                      Definition
of “Cause.”

 

“Cause”
to terminate your employment is defined as follows:

 

(A)                              your
deliberate refusal to substantially perform the duties associated with your
position;

(B)                                your
personally engaging in conduct that you intend to be seriously injurious to the
Company, its affiliates or employees;

(C)                                your
knowing violation of a federal or state law or regulation applicable to the
business of the Company;

(D)                               your
being convicted of a felony under the laws of the United States or any State,
or the misappropriation of material property belonging to the Company or its
affiliates; or

(E)                                 your
knowingly and intentionally breaching in any material respect the terms of your
Proprietary Information Agreement.

 

4

 

c.               Definition
of “Disability.”

 

“Disability”
means a mental or physical impairment, which in the good faith judgment of the
Board of Directors of the Company, prevents you from performing the
responsibilities and duties of your position to their satisfaction for a period
of forty-five (45) consecutive days or ninety (90) days during any twelve-month
period.

 

We are
all delighted to be able to extend you this offer and look forward to working
with you.  To indicate your acceptance of
the Company’s offer, please sign and date this letter in the space provided
below and return it to me, no later than
Friday, April 25, 2003, along with a signed and dated copy of
the Confidential Information and Invention Assignment Agreement.  This letter, along with the Confidential
Information and Invention Assignment Agreement, set forth the terms of your
employment with the Company and supersede any prior representations or
agreements, whether written or oral. 
This letter may not be modified or amended except by a written agreement,
signed by the Company and by you.

 

Sincerely,

 

 

James W. Young, Ph.D.

Chief Executive Officer

Fax:                           650-266-3503

Tel:         650-266-3710

 

 

AGREED AND ACCEPTED:

 

	
   

  	
   

  
	
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5Exhibit
10.9

 

EMPLOYMENT
AGREEMENT

 

December 1, 2003

 

Eric Bjerkholt

 

Dear Eric:

 

On behalf of Sunesis Pharmaceuticals,
Incorporated (the “Company”), I am pleased to offer you the position of Chief
Financial Officer.  Speaking for myself,
as well as the other members of the Company’s Executive Committee, we look
forward to working with you and to your future success as Sunesis’ CFO.

 

The terms of your new position with the Company are as set forth below:

 

1.                                       Position.

 

a.                                       You will become
Chief Financial Officer of the Company, working out of the Company’s offices in
South San Francisco, California.

 

b.                                      You agree to the
best of your ability and experience that you will at all times loyally and
conscientiously perform all of the duties and obligations required of and from
you pursuant to the express and implicit terms hereof.  During the term of your employment, you
further agree that you will devote all of your business time and attention to
the business of the Company, the Company will be entitled to all of the
benefits and profits arising from or incident to all such work services and
advice, you will not render commercial or professional services of any nature
to any person or organization, whether or not for compensation without the
prior written consent of the Company’s Chief Executive Officer, and you will
not directly or indirectly engage or participate in any business that is
competitive in any manner with the business of the Company.  Not withstanding the foregoing, it is understood
that you may continue to provide some very limited consultation to your
previous employer, Itrabiotics, during the first quarter of 2004.  Such consultation must not detract from your
Sunesis employment and must be agreed to by the Company’s CEO. Nothing in this
letter agreement will prevent you from accepting speaking or presentation
engagements in exchange for honoraria or from serving on boards of charitable
organizations or otherwise participating in civic, charitable or fraternal
organizations,

 

1

 

or from owning no more than one percent (1%) of the outstanding equity
securities of a corporation whose stock is listed on a national stock
exchange.  It is contemplated that you
may serve on board of directors of other, non-competitive companies.  Such participation shall not exceed the
greater of six (6) days per year or such number of days as is required for you
to serve on the board of directors of one such company.

 

2.                                       Start Date.  Subject to
fulfillment of any conditions imposed by this letter agreement, you will
commence this new position with the Company on or before January 5, 2004
(the “Start Date”).

 

3.                                       Compensation.

 

a.                                       Base Salary.  You will be paid a monthly salary of $20,000,
which is equivalent to $240,000 on an annualized basis.  Your salary will be payable in two equal
payments per month pursuant to the Company’s regular payroll policy (or in the
same manner as other officers of the Company). 
Your base salary will be reviewed annually for adjustment based on cost
of living and merit, at the discretion of the Board of Directors.

 

b.                                      Bonus. 
In addition to your base salary, you will be eligible to earn incentive
bonuses of up to thirty percent (30%) of your base salary, based on achievement
of objectives mutually agreed upon by you and the Chief Executive Officer.

 

4.                                       Stock Options.

 

a.                                       First Option.  In connection with the commencement of your
employment, the Company will grant you an option (the “First Option”) to
purchase 250,000 shares of the Company’s Common Stock (“Shares”) with an
exercise price equal to the fair market value on the date of the grant
(currently $0.60 per share).  The shares
subject to the Option will vest over four (4) years as follows:  62,500 shares will vest one (1) year
following your Start Date and the remaining 177,500 shares will vest monthly
over the final three (3) years.  The
First Option may be exercised prior to vesting by you (i) paying to the Company
the exercise price for the Shares being purchased, and (ii) entering into a
standard form of restricted stock purchase agreement with the Company.

 

b.                                      Second Option.  In addition to the First Option the Company
will grant you a Second Option (the “Second Option”) of 75,000 additional
Shares also with an exercise price equal to the fair market value on the date
of the grant (currently $0.60 per share). 
The Shares subject to the Second Option shall vest according to the
following schedule:

 

(i)                                     All 75,000 Shares
will vest in the event the Company closes an equity financing transaction within
twelve (12) months after the Start Date with net cash proceeds to the Company
within such period of at least $20 million, at a valuation and with other terms
and conditions that are satisfactory to the Chief Executive Officer and the
Executive Chairman.  It is understood
that such a financing may include an initial public offering that meets such
requirements within such 12-month time period.

 

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(ii)                                  In the event that no
satisfactory equity financing transaction is completed within the twelve (12)
months described in (i) then the all shares of the Second Option will vest on
the fifth anniversary of the Start Date.

 

(iii)                               If the event described
in paragraph (i) above is not fully achieved within the time period specified,
then the Shares covered under the Second Option will not vest except as
provided in paragraph (ii); provided that the Board of Directors may, in its
discretion, permit some or all of such Shares to vest to the extent the Board
determines that circumstances so warrant.

 

5.                                       Benefits.

 

a.                                       Insurance Benefits.  The Company will provide you with standard
medical and dental insurance benefits. 
In addition, the Company currently indemnifies all officers and
directors to the maximum extent permitted by law, and you will be requested to
enter into the Company’s standard form of Indemnification Agreement giving you
such protection.  Pursuant to the
Indemnification Agreement, the Company will agree to advance any expenses for
which indemnification is available to the extent allowed by applicable law.

 

b.                                      Vacation.  You will be entitled to three (3) weeks paid
vacation per year, pro-rated for the remainder of this calendar year.

 

6.                                       Confidential Information and Invention Assignment
Agreement.  Your acceptance
of this offer and commencement of employment with the Company is contingent
upon the execution and delivery to an officer of the Company, of the Company’s
Confidential Information and Invention Assignment Agreement, a copy of which is
enclosed for your review and execution (the “Confidentiality Agreement”), prior
to or on your Start Date.

 

7.                                       Confidentiality of Terms.  You agree to follow the Company’s strict
policy that employees must not disclose, either directly or indirectly, any
information, including any of the terms of this agreement, regarding salary,
bonuses, or stock purchase or option allocations to any person, including other
employees of the Company; provided, however, that you may discuss such terms
with members of your immediate family and any legal, tax or accounting
specialists who provide you with individual legal, tax or accounting advice,
and you may discuss it with other employees of the Company on a need to know
basis if required to carry out your duties as the Company’s Chief Financial
Officer.

 

8.                                       At-Will Employment.  Your employment with the Company will be on an
“at will” basis, meaning that either you or the Company may terminate your
employment at any time for any reason or no reason on thirty (30) days notice,
without further obligation or liability.

 

a.                                       In addition, if
you are terminated by the Company without “cause”, as defined below (other than
by reason of Disability), then:

 

3

 

(i)                                     your annual base
salary will continue to be paid in accordance with the Company’s standard
payroll policies until the earlier of (A) nine (9) months following the date of
termination or (B) your acceptance of other full-time employment at an equal or
greater base salary.  If you obtain full
time employment at an annualized base salary less than the annualized base
salary you were entitled to at the Company, then the Company will pay you the
difference in monthly base salary on a monthly basis until the end of the
Company’s severance pay obligation.  You
shall have no obligation to obtain other employment during the severance
payment period;

 

(ii)                                  you will continue to
receive benefits pursuant to the Company’s Benefit Plans, provided that such
Benefit Plans permit continuation post-termination by payment of State or
Federal COBRA premiums, at the Company’s expense until the earlier of (A) nine
(9) months following the date of termination, or (B) you are no longer eligible
for State of Federal COBRA;

 

(iii)                               the number of Shares
vested under the First Option shall be measured as if the termination occurred
nine (9) months after the actual date of termination; and

 

(iv)                              you shall be entitled to
the benefits described in subparagraphs (i), (ii) and (iii) above if you
terminate employment of Effective Termination. 
“Effective Termination” shall mean: 
(A)  without your express written
consent, a significant reduction of your duties, position or responsibilities;
or (B) without your express written consent, a substantial reduction of the
facilities and perquisites (including office space and location); or (C) a
material reduction by the Company of your base salary; or (D) a reduction by
the Company in the kind or level of your benefits to which you are entitled
with the result that your overall benefits package is significantly reduced; or
(E) without your express written consent, the relocation of you to a facility
or location more than one hundred (100) miles from the Company’s current
facility.

 

(v)                                 Upon change of control
(as defined below) of the Company, vesting of the unvested portion of the First
Option or the Company’s right to repurchase stock under the stock purchase
agreement entered into upon exercise of the First Option shall automatically be
accelerated (or in the case of the right of repurchase, shall lapse) so that
such First Option (or shares, as applicable) shall become completely
vested.  For the purposes of this Section 8(v),
“Change of Control” shall mean a merger or reorganization of the Company with
or into any other corporation or corporations, or a sale of all or
substantially all of the assets of the corporation, or a sale of securities of
the Company, in which transaction the Company’s stockholders immediately prior
to such transaction own immediately after such transaction less than 50% of the
equity securities of the surviving corporation or its parent.  Notwithstanding the foregoing, if it is
determined by the Company’s independent public accountants that such
accelerated vesting would preclude accounting for the change of control as a pooling
of interests for financial accounting purposes, and it is a condition to the
closing of the change of control that the transaction be accounted for as a
pooling of interests, then the accelerated vesting shall not occur pursuant to
this section (v) but shall be accelerated at the earliest time which will
not preclude accounting as a pooling of interests.

 

4

 

(vi)                              Your stock option
agreement and/or stock purchase agreement will reflect the vesting acceleration
and change of control provisions recited in this Agreement.

 

b.                                      Definition of “Cause.”

 

“Cause” to terminate your employment is
defined as follows:

 

(A)                              your deliberate refusal
to substantially perform the duties associated with your position;

 

(B)                                your personally
engaging in conduct that you intend to be seriously injurious to the Company,
its affiliates or employees;

 

(C)                                your knowing violation
of a federal or state law or regulation applicable to the business of the
Company;

 

(D)                               your being convicted of
a felony under the laws of the United States or any State, or the
misappropriation of material property belonging to the Company or its
affiliates; or

 

(E)                                 your knowingly and
intentionally breaching in any material respect the terms of your Proprietary
Information Agreement.

 

c.                                       Definition of “Disability.”

 

“Disability” means a mental or physical
impairment, which in the good faith judgment of the Board of Directors of the
Company, prevents you from performing the responsibilities and duties of your position
to their satisfaction for a period of forty-five (45) consecutive days or
ninety (90) days during any twelve-month period.

 

We are all delighted to be able to extend you this offer and look
forward to working with you.  To indicate
your acceptance of the Company’s offer, please sign and date this letter in the
space provided below and return it to me, along with a signed and dated copy of
the Confidentiality Agreement.  This
letter, together with the Confidentiality Agreement, set forth the terms of
your employment with the Company and supersede any prior representations or
agreements, whether written or oral. 
This letter may not be modified or amended except by a written
agreement, signed by the Company and by you.

 

Very truly yours,

 

	
  SUNESIS PHARMACEUTICALS, INCORPORATED

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  

 

5

 

	
  AGREED AND ACCEPTED:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Name

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
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  Enclosure:

  	
  Confidential Information and Invention
  Assignment Agreement

  
				

 

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