Document:

Exhibit 10.5

 

FIRST AMENDMENT TO EMPLOYMENT AGREEMENT

 

This
FIRST AMENDMENT TO EMPLOYMENT AGREEMENT (this “Amendment”) is entered
into as of this 18th day of November, 2005 by and between Advanced Life
Sciences, Inc., an Illinois corporation (“ALS”), and Ze-Qi Xu,
Ph.D. (the “Executive”) to amend the terms of that certain Employment Agreement
dated April 11, 2005 between ALS and the Executive (the “Agreement”).

 

WHEREAS,
ALS and the Executive entered into the Agreement on April 11, 2005;

 

WHEREAS,
the parties wish to amend the Agreement as provided herein.

 

NOW,
THEREFORE, in consideration of the foregoing recitals, the parties hereto,
intending to be legally bound, agree as follows:

 

1.               Incorporation
of the Agreement. 
All capitalized terms which are not defined herein shall have the same
meanings as set forth in the Agreement, and the Agreement, to the extent not
inconsistent with this Amendment, is incorporated herein by this reference as
though the same was set forth in its entirety. 
To the extent any terms and provisions of the Agreement are inconsistent
with the amendments set forth in Paragraph 2 below, such terms and provisions
shall be deemed superseded hereby. 
Except as specifically set forth herein, the Agreement shall remain in
full force and effect and its provisions shall be binding on the parties
hereto.

 

2.               Amendment of
the Agreement. 
The Agreement is hereby amended as follows:

 

a.               Section 4(a) of the
Agreement shall be deleted in its entirety and replaced with the following
language:

 

“Salary.  The Company shall pay to the Executive an
annual base salary of $180,000 (“Base Salary”), payable in substantially equal
installments no less frequently than monthly in accordance with the Company’s
applicable payroll practices.  The amount
of Base Salary shall be reviewed annually by the Chief Executive Officer to
determine whether to increase the Base Salary on a prospective basis.  The Executive’s Base Salary shall not be
reduced after any increase, without the Executive’s consent.”

 

b.              Section 4(b) of the
Agreement shall be deleted in its entirety and replaced with the following
language:

 

“Bonus.  The Executive shall be eligible to
participate throughout the Term in the Company’s annual bonus plan or any
similar or successor bonus plan (“Bonus Plan”) in accordance with the
Company’s compensation practices and the terms and provisions
of the
Bonus Plan.  During the 2006 fiscal year
of the Company, the maximum bonus that the Executive may receive is $75,000.”

 

3.               Effectuation.  Except as amended by this Amendment, the
provisions of the Agreement shall continue for all purposes without
interruption and the Agreement shall remain in full force and effect. The
amendment to the Agreement contemplated by this Amendment shall be deemed
effective as of November 1, 2005.

 

 

4.               Counterparts.  This Amendment may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.

 

[Signature Page Follows]

 

 

[Signature Page to
First Amendment to Employment Agreement]

 

IN
WITNESS WHEREOF, the parties hereto have duly executed this Amendment as of the
date first above written.

 

 

	
  EXECUTIVE

  	
  ADVANCED LIFE SCIENCES, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Ze-Qi Xu

  	
   

  	
  By:

  	
  /s/ Michael T. Flavin

  	
   

  
	
  Name:

  	
  Ze-Qi Xu, Ph.D.

  	
  Name:

  	
  Michael T. Flavin, Ph.D.

  
	
   

  	
   

  	
  Its:

  	
  Chief Executive OfficerExhibit 10.6

 

Employment Agreement

 

THIS EMPLOYMENT AGREEMENT (this “Agreement”)
made effective as of the 11th day of April 2005(the “Effective
Date”), by and between Advanced Life Sciences, Inc., an Illinois
corporation (the “Company”), and David A Eiznhamer, Ph.D. (the “Executive”).

 

WHEREAS, the
Company and the Executive previously entered into an employment contract (the “Existing
Employment Contract”); and

 

WHEREAS, the
Company and the Executive desire to enter into this Agreement, effective as of
the Effective Date, to replace the Existing Employment Contract; and

 

WHEREAS, the Company desires to employ the
Executive in accordance with the terms and conditions hereinafter set forth and
the Executive desires to be so employed; and

 

WHEREAS, the Company has agreed with the
Executive that this Agreement shall set forth the terms and conditions of the
Executive’s employment with the Company;

 

NOW, THEREFORE, in consideration of the
mutual covenants contained herein, the Company and the Executive agree as follows:

 

1.                                       Term.  The employment of the Executive by the
Company pursuant to this Agreement shall begin as of the Effective Date and shall expire
on the third anniversary of the Effective Date (the “Term”), unless extended,
as set forth below, or otherwise terminated pursuant to the provisions of this
Agreement; provided, however, that commencing on the third
anniversary of the Effective Date and on each anniversary thereafter, the Term
of this Agreement shall automatically be extended for one additional year
unless, not later than 90 days prior to such anniversary, the Executive or the
Company shall have given notice in writing that he or it does not wish to
extend this Agreement.

 

2.                                       Position and
Duties.  The Executive shall serve as
the Vice President of Biological Sciences of the Company, and shall have such
responsibilities, duties and authority as are assigned by the Chief Scientific Officer
of the Company and are customarily associated with such position, including
but not limited to, those he may have as of the Effective Date.  The Executive shall report to the Chief Scientific
Officer of the Company.  The Executive
shall devote such time to the performance of his duties as is necessary to
satisfactorily perform his responsibilities and duties.

 

3.                                       Place of
Performance.  In connection with the
Executive’s employment by the Company, the Executive shall be based at the
principal executive offices of the Company currently in Woodridge, Illinois, except for
required travel on the Company’s business.

 

4.                                       Compensation
and Related Matters.  During the Term
of the Executive’s employment, as compensation and consideration for the
performance by the Executive of the Executive’s duties, responsibilities and
covenants pursuant to this Agreement, the Company shall pay the
Executive and the Executive agrees to accept in full payment for such
performance the amounts and benefits set forth below.

 

 

(a)                                  Salary.  The Company shall pay to the Executive an
annual base salary of $125,000 (“Base Salary”), payable in substantially equal
installments no less frequently than monthly in accordance with the Company’s
applicable payroll practices.  The amount
of Base Salary shall be reviewed annually by the Chief Executive Officer (with
the first review to occur prior to the first anniversary of the Effective Date)
to determine whether to increase the Base Salary on a prospective basis.  The Executive’s Base Salary shall not be
reduced after any increase, without the Executive’s consent.

 

(b)                                 Bonus.  The Executive shall be eligible to
participate throughout the Term in the Company’s annual bonus plan or any similar or successor bonus
plan (“Bonus Plan”) in accordance with the Company’s
compensation practices and the terms and provisions of the Bonus Plan.  During the 2005 fiscal year of the Company,
the maximum bonus that the Executive may receive under the Bonus Plan is $35,000.

 

(c)                                  Stock
Incentive Plan.  As of the Effective
Date, the Executive shall
be shall be eligible to
receive additional awards of the Company’s common stock under the
Stock Incentive Plan or under
any other equity plan of the Company as determined by the Board
of Directors of the Company (the “Board”) in its discretion.

 

(d)                                 Other Benefits and
Perquisites.  During the Term of the
Executive’s employment hereunder:

 

(i)                                     Benefit
Plans.  The Executive shall be
entitled to participate in or receive benefits under any employee pension or welfare
benefit plan or arrangement made available by the Company at any time during
his employment hereunder to its employees (collectively the “Benefit Plans”),
including without limitation each qualified retirement plan, life insurance and
accident plan, medical, dental insurance plans, and disability plan, subject to
and on a basis consistent with the terms, conditions and overall administration
of such plans and arrangements, as they may be amended from time to time.

 

(ii)                                  Vacation.  The Executive shall be entitled to not less
than 15 days of paid vacation in each calendar year, in accordance with the
Company’s vacation policy.

 

(iii)                               Expense
Reimbursement.  The Executive shall
be entitled to receive reimbursement for all reasonable business, travel or
other out-of-pocket expenses incurred by the Executive in fulfilling the
Executive’s duties and responsibilities hereunder, provided that such expenses
are incurred and accounted for in accordance with the policies and procedures
established by the Company.

 

5.                                       Termination.

 

(a)                                  The
Executive’s employment hereunder may be terminated under the following
circumstances:

 

(i)                                     The death of the
Executive;

 

 

(ii)                                  By the Company for “Cause”,
which shall mean any of the following:, as determined by the Board in its
discretion:  (A) conviction
of or plea of guilty or nolo contendere
to any criminal violation involving dishonesty or fraud; (B) engagement in conduct that is
injurious to the Company; (C) engagement in any act of dishonesty or
misconduct that results in damage to the Company or its business or reputation
or that the Board determines to adversely affect the value, reliability or
performance of the Executive
to the Company; (D) refusal or failure to substantially comply with the
Company’s human resources rules, policies, directions and/or restrictions
relating to harassment and/or discrimination, or with compliance or risk
management rules, policies, directions and/or restrictions; (E) unauthorized
use or disclosure of Confidential
Information (as defined below) or other trade secrets of the
Company; (F) loss of any
license or registration that is necessary for the Executive to perform his
duties to the Company, or commission of any act that could result in the legal
disqualification of the Executive from being employed by the Company or any of
its affiliates; (G) failure to cooperate with the Company or any of its
affiliates in any internal investigation or administrative, regulatory or
judicial proceeding; or (H) continuous failure by the Executive to perform
his duties to the Company (which may include any sustained and unexcused
absence of the Executive from the performance of such duties, which absence has
not been certified in writing as due to physical or mental illness or
disability), after a written demand for performance has been delivered to the
Executive identifying the manner in which the Executive has failed to
substantially perform such duties.  The
application of any part of the definition of Cause set forth in clauses (A) through
(H) above to the Executive shall not preclude or prevent the reliance by
the Company or the Board on any other part of the definition that also may be
applicable.  In addition, the Executive’s
employment shall be deemed to have terminated for Cause if, after the Executive’s
employment has terminated, facts and circumstances are discovered that would
have justified a termination for Cause.

 

(iii)                               By
mutual agreement between the Company and the Executive; or

 

(iv)                              By
the Executive or the Company for any reason other than as stated in Sections
5(a)(i) through 5(a)(iii) above, upon providing a Notice of
Termination (as defined in Section 5(b)).

 

(b)                                 Notice of
Termination.  Any termination of the
Executive’s employment by the Company or by the Executive (other than a
termination pursuant to Section 5(a)(i) above)
shall be communicated by written Notice of Termination to the other party
hereto in accordance with Section 10.  For
purposes of this Agreement, a “Notice of Termination” shall mean a notice that
shall indicate the specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of the Executive’s employment under the
provision so indicated.

 

(c)                                  “Date of Termination”
shall mean (i) if the Executive’s employment is terminated pursuant to Section 5(a)(i) above,
the date of his death; (ii) if the Executive’s employment is terminated
pursuant to Section 5(a)(ii) or 5(a)(iv) above, the date such

 

 

Notice of Termination is given (or such later date as provided
therein); (iii) if the Executive’s employment is terminated pursuant to Section 5(a)(iii) above,
the date mutually agreed to by the parties; (iv) the date the Term of this
Agreement expires, if either the Company or the Executive provides notice in
accordance with Section 1; or (v) if the Executive terminates his
employment and fails to provide written notice to the Company of such
termination, the date of such termination.

 

6.                                       Compensation
Upon Termination.

 

(a)                                  The following
payments shall be made upon the Executive’s termination of employment for any
reason:  (i) earned but unpaid Base
Salary through the Executive’s Date of Termination; (ii) any accrued but
unpaid vacation; (iii) unreimbursed business expenses owed pursuant to Section 4(d)(iii); and (iv) any amounts payable under any of the
Company’s Benefit Plans in accordance with the terms of those plans.  All amounts under clauses (i) through (iii) shall
be paid in a lump sum on the Executive’s Date of Termination or as soon as
administratively practicable thereafter.

 

(b)                                 In
the event the Executive’s employment is terminated pursuant to Sections 5(a)(i) or
5(a)(ii), or by the Executive for any reason pursuant
to Section 5(a)(iv), above, the Company shall have no further obligation
to the Executive under this Agreement, other than the payments in Section 6(a).

 

(c)                                  If
the Executive’s employment is terminated by the parties pursuant to Section 5(a)(iii) above, the Executive shall be entitled to
receive the compensation the parties specify in any written agreement that the
Company and the Executive execute regarding the Executive’s termination.

 

(d)                                 In
addition to the payments made under Section 6(a), if the Executive’s
employment is terminated by the Company without Cause pursuant to Section 5(a)(iv) above,
the Company shall, for a
period of six (6) months following the Date of Termination, (i) provide
to Executive salary continuation, at Executive’s Base Salary rate then in
effect, and (ii) continue the Executive’s coverage under the Benefit Plans
in which the Executive participated immediately prior to the Date of
Termination, provided, however, that if the Company cannot continue such
coverage, the Company shall provide or arrange to provide, at its expense,
similar coverage to the Executive. 
Notwithstanding the forgoing, vacation days shall not accrue during the
six (6) month period of severance.

 

(e)                                  The Executive shall
not be required to mitigate the amount of any payment provided for in this Section 6
by seeking other employment or otherwise, nor shall the amount of any payment
or benefit provided for in this Section 6 be reduced by any compensation
earned by the Executive as the result of employment by another employer, by
retirement benefits, by offset against any amount claimed to be owed by the
Executive to the Company, or otherwise.

 

(f)                                    The obligations of
the Company to make payments and provide benefits under this Section 6
shall survive the termination of this Agreement.

 

 

7.                                       Change in Control.

 

(a)                                  Payments
and Benefits Upon Employment Termination Upon a Change
in Control.  If the Executive’s
employment is terminated other than for Cause within 24 months after a Change
in Control (as defined below), the Company shall provide the following payments
and benefits to the Executive, in lieu of those payments and benefits provided
under Sections 6(d), but in addition to the amounts payable under Section 6(a):

 

(i)                                     The
Company shall pay the Executive a lump sum cash amount equal to two (2) times
the sum of (A) the Executive’s Base Salary as in effect on the date of the
Executive’s termination of employment and (B) the Executive’s target bonus
amount for the fiscal year in which the Executive’s employment is terminated OR
an amount equal to the annual bonus paid to the Executive during the fiscal
year immediately preceding the Executive’s termination of employment.

 

(ii)                                  The
Company shall continue the Executive’s coverage under the Benefit Plans in
which the Executive participated immediately prior to the Executive’s
termination of employment for a period of 24 months, provided, however, that if
the Company cannot continue such coverage, the Company shall provide or arrange
to provide, at its expense, similar coverage to the Executive.

 

(b)                                 Timing
of Payment.  All payments under Section 7(a) shall
be made in a lump sum cash payment as soon as practicable, but in no event more
than 10 days after the Executive’s termination of employment.

 

(c)                                  Definitions.  For purposes of this Agreement, the following
terms shall have the following definitions:

 

(i)                                     “Change
in Control” means the occurrence of any one or more of the following:

 

(A)                              Any
“person” (as such term is defined in Section 3(a)(9) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”) and as used in
Sections 13(d)(3) and 14(d)(2) of the Exchange Act), including a “group”
(as defined in Section 13(d)(3) of the Exchange Act), other than (I)
the Company, (II) any wholly-owned subsidiary of the Company, (III) any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any of its affiliates, or (IV) a “Permitted Holder” (as defined below),
becomes a “beneficial owner” (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Company having fifty percent
(50%) or more of the combined voting power of the then-outstanding securities
of the Company that may be cast for the election of directors of the Company
(other than as a result of an issuance of securities initiated by the Company
in the ordinary course of business) (the “Company Voting Securities”);
provided, however, that the event described in this Section 7(c)(i) shall
not be deemed to be a Change in Control by virtue of any underwriter
temporarily holding securities pursuant to an offering of such securities;

 

 

(B)                                During
any period of two consecutive years, individuals who at the beginning of any
such period constitute the Board (the “Incumbent Directors”) cease for any
reason to constitute at least a majority of the Board, unless the election, or
the nomination for election by the stockholders of the Company, of each new
director of the Company during such period was approved by a vote of at least
two-thirds of the Incumbent Directors then still in office;

 

(C)                                As
the result of, or in connection with, any cash tender or exchange offer, merger
or other business combination, sale of all or substantially all of the Company’s
assets or contested election, or any combination of the foregoing transactions,
less than a majority of the combined voting power of the then-outstanding
securities of the Company or any successor corporation or entity entitled to
vote generally in the election of the directors of the Company or such other
corporation or entity after such transaction is held in the aggregate by the
holders of the securities of the Company entitled to vote generally in the
election of directors of the Company immediately prior to such transaction; or

 

(D)                               The
stockholders of the Company approve a plan of complete liquidation or
dissolution of the Company.

 

Notwithstanding the foregoing, a Change in
Control shall not be deemed to occur solely because any person acquires
beneficial ownership of more than fifty percent (50%) of the Company Voting
Securities as a result of the acquisition of Company Voting Securities by the
Company which reduces the number of Company Voting Securities outstanding;
provided, however, that if after such acquisition by the Company such person
becomes the beneficial owner of additional Company Voting Securities that
increases the percentage of outstanding Company Voting Securities beneficially
owned by such person, a Change in Control transaction shall then occur.

 

Further notwithstanding the foregoing, unless
a majority of the Incumbent Directors determines otherwise, no Change in
Control shall be deemed to have occurred with respect to the Executive if the
Change in Control results from actions or events in which the Executive is a
participant in a capacity other than solely as an officer, employee or director
of the Company or any of its affiliates.

 

(ii)                                  “Permitted
Holders” means (A) Michael T. Flavin (the “Principal”), (B) the
spouse or any immediate family member of the Principal and any child or spouse
of any spouse or immediate family member of the Principal, (C) a trust,
corporation, partnership or other entity, the beneficiaries, stockholders,
partners, owners or persons beneficially holding, directly or indirectly, a
controlling interest of which consists of the Principal and/or such other
persons referred to in the immediately preceding clause (B), or (D) the
trustees of any trust referred to in clause (D).

 

 

(d)                                 Treatment
of Parachute Payments.

 

(i)                                     Notwithstanding
any other provisions of this Agreement, and except as set forth below, in the
event that any payment or benefit received or to be received by the Executive
in connection with a Change in Control or the termination of the Executive’s
employment (whether pursuant to the terms of this Agreement or any other plan,
arrangement or agreement with the Company, any person whose actions result in a
Change in Control or any person affiliated with the Company or such person)
(all such payments and benefits, including payments under Section 7(a) above,
being hereinafter called “Total Payments”) is determined to be an “excess
parachute payment” pursuant to Section 280G of the Internal Revenue Code
of 1986, as amended (the “Code”), or any successor or substitute provision of
the Code, with the effect that the Executive is liable for the payment of the
excise tax described in Code Section 4999 or any successor or substitute
provision of the Code (the “Excise Tax”), then, after taking into account any
reduction in the Total Payments provided by reason of Code Section 280G in
such other plan, arrangement or agreement, the cash payments provided in Section 7(a)(i) of
this Agreement shall first be reduced, and the noncash payments and benefits
shall thereafter be reduced, to the extent necessary so that no portion of the
Total Payments is subject to the Excise Tax; provided, however, that the
Executive may elect (at any time prior to the payment of any Total Payment
under this Agreement) to have the noncash payments and benefits reduced (or
eliminated) prior to any reduction of the cash payments under this Agreement.

 

(b)                                 All
determinations required to be made under this Section 7(d), and the
assumptions to be utilized in arriving at such determination, shall be made by
the certified public accounting firm used for auditing purposes by the Company
immediately prior to the date of the Executive’s termination of employment or,
if the parties determine that such certified public accounting firm cannot make
such determination because of legal restrictions, the parties shall agree on a
different certified public accounting firm (such certified public accounting
firm is hereinafter referred to as the “Accounting Firm”), which shall provide
detailed supporting calculations both to the Company and the Executive not
later than 5 days prior to the date of the Executive’s termination of
employment.  The Company shall pay all
fees and expenses of the Accounting Firm. 
Any determination by the Accounting Firm shall be binding upon the
Company and the Executive, except as provided in paragraph (c) below.

 

(c)                                  As
a result of the uncertainty in the application of Code Sections 280G and 4999
at the time of the initial determination by the Accounting Firm hereunder, it
is possible that the Internal Revenue Service (the “IRS”) or other agency will
claim that an Excise Tax, or a greater Excise Tax, is due.  If the Executive is required to make a
payment of any such Excise Tax, the Company will promptly pay the Executive an
additional amount equal to the amount, or greater amount, of Excise Tax the
Executive is required to pay (plus a gross up payment for any income taxes,
interest, penalties or additional Excise Tax payable by Executive with respect
to such Excise Tax or additional payment), as

 

 

determined by the Accounting Firm.  The Executive will notify the Company in
writing of any claim by the IRS or other agency that, if successful, would
require payment by the Company of the additional payments under this paragraph.  The Executive and the Company shall each
reasonably cooperate with the other in connection with any administrative or
judicial proceedings concerning the existence or amount of liability for Excise
Tax with respect to the Total Payments. 
The Company shall pay all fees and expenses of the Executive relating to
a claim by the IRS or other agency.

 

8.                                       Restrictive
Covenants.

 

(a)                                  Trade
Secrets.  The Executive acknowledges that
he has had and shall have access to confidential information of the Company, whether
or not reduced to writing and whether in paper, electronic, digital, analog or
other format (including, but not limited to, trade secrets, know-how,
Inventions (as defined below), new product and product development information,
research results, marketing and sales programs, customer and supplier
information, financial data, employee records, cost information, pricing
information, sales and marketing strategies, the identity of customers,
information received by the Company under an obligation of confidentiality to
customers, and all information generated by the Company for customers) relating
to the past, present or planned business, customers, clients, contacts,
prospects and assets of the Company that is unique, valuable and has not
purposefully been made generally known to the public by the Company (“Confidential
Information”).  Confidential Information
shall not include any information that: (i) is now, or hereafter becomes,
through no act or failure to act on the part of the Executive that constitutes
a breach of this Section 8, generally known or available to the public; (ii) is
hereafter furnished without restriction on disclosure to the Executive by a
third party, other than an employee or agent of the Company, who is not under
any obligation of confidentiality to the Company; (iii) is disclosed with
the written approval of the Company; or (iv) is required to be disclosed
or provided by law, court order, or similar compulsion, including pursuant to
or in connection with any legal proceeding involving the parties hereto;
provided, however, that such disclosure shall be limited to the extent so
required or compelled; and provided further, however, that if the Executive is
required to disclose such Confidential Information, the Executive shall give
the Company notice of such disclosure and cooperate in seeking suitable
protections.  The Executive acknowledges
that all Confidential Information, and all documents, files, reports, drawings,
designs, specifications, formulae, samples, data, writings, tools, equipment,
memory devices or any other tangible objects that incorporate, contain, refer
to or embody any Confidential Information (“Items”), acquired by the Executive
in connection with the Executive’s employment with the Company are the property
of the Company.  Other than in the course
of performing services for the Company or otherwise authorized in writing by
the Company, the Executive shall not, at any time, directly or indirectly use,
divulge, furnish or make accessible to any person any Confidential Information,
but instead shall keep all Confidential Information strictly and absolutely
confidential.  The Executive shall
deliver promptly to the Company, at the termination of his employment or at any
other time at the request of the Company, without retaining any copies, all
Items and any other documents or materials in the Executive’s possession
relating, directly or indirectly, to any Confidential Information.

 

 

(b)                                 Non-competition.  Beginning on the Effective Date and for a
period of  twelve (12) months following
Executive’s Date of Termination (the “Restricted Period”), Executive shall not
directly or indirectly, alone or in conjunction with any other party, own any
interest in, operate, control, engage in or participate as a partner, director,
principal, officer, employee, independent contractor or agent of, act as a
consultant to, perform any services for, or assist in any way any company,
person, or entity in the United States that is engaged in “Competing Services”
(as defined herein).  Competing Services
shall mean chemistry and biology research and development relating to, arising
from, connected with, or competitive with or intended to be competitive with,
any product or research project as to which the Executive performed services
for the Company, or about which the Executive received access to Confidential
Information while employed by the Company. 
If the Executive obtains other employment during the twelve-month period
after the Executive’s Date of Termination, the Executive agrees to notify the
Company in writing of the name and address of such employer.  The Executive understands, and the Company
agrees, that the Company shall pay to the Executive a monthly amount equal to
one month of the Executive’s final Base Salary if the Executive is unable to
secure other employment as a direct result of this Section 8(b).  The Executive agrees and acknowledges that (i) the
Company shall be obligated to make such payment only upon a written request by
the Executive containing sufficient information for the Company to make a
determination that this Section 8(b) caused the Executive’s inability
to secure other employment, and (ii) the Company shall be released from
the obligation to make such payment if the Company provides the Executive a
written release from this Section 8(b). 
The Company’s obligation to make payments under this Section 8(b) shall
be made only for the period beginning with the Executive’s inability to secure
other employment as a result of this Section 8(b) and ending no later
than the expiration of the twelve-month period following the Executive’s Date
of Termination.

 

(c)                                  Non-Solicitation
of Employees. During the Restricted Period, the Executive shall not, directly
or indirectly solicit or induce, or attempt to solicit or induce, any current
employee of the Company, or any individual who becomes an employee during the
Restricted Period, to leave his or her employment with the Company or join or
become affiliated with any other business or entity, hire any employee of the
Company or in any way interfere with the relationship between any employee and
the Company.

 

(d)                                 Non-Solicitation
of Customers.  During the Restricted
Period, the Executive shall not, directly or indirectly, solicit or induce, or
attempt to solicit or induce, any customer, supplier, licensee, licensor or
other business relation of the Company to terminate its relationship or
contract with the Company, to cease doing business with the Company, or in any
way interfere with the relationship between any such customer, supplier,
licensee or business relation and the Company (including making any negative
statements or communications concerning the Company or their employees).

 

(e)                                  Inventions.  The Executive acknowledges all inventions of
the Company (including, but not limited to, procedures, systems, machines,
methods, processes, uses, apparatuses, compositions of matter, designs, or
configurations of any kind, discovered, conceived, reduced to practice,
developed, made or produced) (“Inventions”) that (i) relate to the present
or planned business of the Company or the work performed by the

 

 

Company for
its customers, and (ii) are conceived or reduced to practice by the
Executive, either alone or with others, during the Executive’s employment with
the Company or during a period of 120 days after the Executive’s Date of
Termination, whether or not done during the Executive’s regular working hours,
are the sole property of the Company, including, without limitation, all
domestic and foreign patent rights, rights of registration or other protection
under the copyright laws, or other rights pertaining to the Inventions.  For purposes of this Agreement, Inventions
shall include any improvements to an Invention and shall not be limited to the
definition of a patentable invention or copyrightable work of authorship as
contained in the United States patent or copyright laws.  The Executive shall disclose promptly and
fully in writing to the Company each Invention, whether or not reduced to
practice, that the Executive conceives or learns (either alone or jointly with
others) during the Term of Employment. 
The Executive hereby assigns to the Company, or its nominee, all of the
Executive’s right, title and interest, including international priority rights,
in and to all Inventions (other than any Invention that was developed entirely
on the Executive’s own time and for which no equipment, supplies, facilities or
trade secret information of the Company was used, unless such Invention relates
directly to the Company’s business or to the Company’s actual or demonstrably
anticipated research or development), and in and to all United States or
foreign patents, copyrights and other proprietary rights granted thereon or
resulting therefrom, and in and to all applications for United States or
foreign copyrights, patents and other proprietary rights.  The Executive shall execute all papers,
perform all lawful acts or assist the Company in any way the Company deems
necessary or advisable (at the Company’s expense) for the preparation, filing, prosecution,
issuance, procurement, maintenance or enforcement of patents applications and
patents of the United States and foreign countries, and for obtaining and
enforcing copyright protection and registration, of any Invention.  To that end, the Executive shall at the
Company’s request and without limitation, testify in any suit or other
proceeding involving any of the Inventions, execute all documents that the
Company reasonably determines to be necessary or convenient for use in applying
for and obtaining patent or copyright protection and registration on any of the
Inventions and enforcement of that protection and registration, and execute all
necessary documents and papers required to vest title in and assign to the
Company (or its nominee) patent or copyright protection and registration.  The Executive’s obligation to assist the
Company in obtaining and enforcing patent or copyright protection and
registration for the Inventions shall continue following termination of this
Agreement, but Company shall compensate the Executive following the expiration
or termination of this Agreement at a rate of $10 for the execution of each
document and $150 per day for each day or portion thereof spent at the Company’s
request in rendering assistance, plus reimbursement for the reasonable
out-of-pocket expenses incurred by the Executive for such assistance.  The Executive hereby irrevocably appoints the
Company and its duly authorized officers and agents as his agent and attorney-in-fact
to act for and on behalf of the Executive in filing all patent applications,
applications for copyright protection and registration amendments, renewals and
all other appropriate documents in any way related to the Inventions.

 

(f)                                    Survival.  The provisions set forth in this Section 8
shall survive termination of this Agreement.

 

 

(g)                                 Scope
Limitations.  If the scope, period of
time or area of restriction specified in this Section 8 are or would be
judged to be unreasonable in any court proceeding, then the period of time,
scope or area of restriction shall be reduced or limited in the manner and to
the extent necessary to make the restriction reasonable, so that the
restriction may be enforced in those areas, during the period of time and in
the scope that are or would be judged to be reasonable.

 

9.                                       Binding
Agreement; Successors.  This Agreement
and all rights of the Executive hereunder shall inure to the benefit of and be
enforceable by the Executive’s personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.  If the Executive should die while any amounts
would still be payable to him hereunder if he had continued to live, all such
amounts, unless otherwise provided herein, shall be paid in accordance with the
terms of this Agreement to the Executive’s devisee, legatee, or other designee
or, if there be no such designee, to the Executive’s estate.  This Agreement shall be binding upon, and
inure to the benefit of, any successors or assigns of the Company.  This Agreement is not intended to confer upon
any person other than the parties hereto (and the Executives’ Spouse and
dependents) any rights or remedies, except as specifically provided in this Section 9.

 

10.                                 Notice.  Notices, demands and all other communications
provided for in this Agreement shall be in writing and shall be deemed to have
been duly given when delivered, if delivered personally, or (unless otherwise
specified) when received, if mailed
by United States certified or registered mail, return receipt requested,
postage prepaid, by Federal
Express or other reputable overnight courier service or by facsimile,
addressed as follows:

 

If to the Executive:

 

David A.
Eizenhamer, Ph.D.

112 North
Bristol Drive

Bloomingdale, IL  60108

 

If to the Company:

 

Advanced Life
Sciences, Inc.

1440 Davey
Road

Woodridge,
Illinois 60517

Attn: Chief
Executive Officer

 

or to such other
address as any party may have furnished to the other in writing in accordance
herewith, except that notices of change of address shall be effective only upon
receipt.

 

11.                                 General
Provisions.  No provision of this
Agreement may be modified, waived or discharged unless such waiver,
modification or discharge is agreed to in writing signed by the Executive and
such officer of the Company as may be specifically designated by the Company’s
Board.  No waiver by either party hereto
at any time of any breach by the other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. 
No agreements or representations, oral or otherwise, express or implied,
with respect to the subject matter hereof have been made by either party that are not set forth expressly in this Agreement.

 

 

12.                                 Validity.  The invalidity or unenforceability of any
provision or provisions of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement, which shall remain in
full force and effect.  If any provision of this Agreement is found
to be invalid or unenforceable, in whole or in part, then it shall be deemed to
be modified or restricted to the extent and in the manner necessary to render
it valid and enforceable, or shall be deemed excised from this Agreement, as
the case may require, and this Agreement shall be construed and enforced to the
maximum extent permitted by law, as if the provision had been originally
incorporated herein as so modified or restricted, or as if it had not
originally been incorporated herein, as the case may be.

 

13.                                 Counterparts.  This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together shall
constitute one and the same instrument.

 

14.                                 Entire
Agreement.  This Agreement sets forth
the entire agreement of the parties hereto in respect of the subject matter
contained herein and supersedes all prior agreements, promises, covenants,
arrangements, communications, representations or warranties, whether oral or
written, by any officer, employee or representative of any party hereto; and
any prior agreement of the parties hereto in respect of the subject matter
contained herein is hereby terminated and canceled. For the avoidance of doubt, the
Company and the Executive hereby agree that this Agreement shall replace and
supercede the Existing Employment Contract and govern the relationship of the
parties.

 

15.                                 Irreparable
Harm.  The Executive acknowledges
that: (i) the Executive’s compliance with this Agreement is necessary to
preserve and protect the proprietary rights, Confidential Information and the
goodwill of the Company and its subsidiaries as going concerns; (ii) any
failure by the Executive to comply with the provisions of this Agreement shall result in
irreparable and continuing injury for which there will be no adequate remedy at
law; and (iii) in the event that the Executive should fail to comply with
the terms and conditions of this Agreement, the Company shall be entitled, in
addition to such other relief as may be proper, to all types of equitable
relief (including, but not limited to, the issuance of an injunction and/or
temporary restraining order) as may be necessary to cause the Executive to
comply with this Agreement, to restore to the Company its property, and to make
the Company whole.

 

16.                                 Consent
to Jurisdiction and Forum; Legal Fees and Costs.  The Company and the Executive hereby
expressly and irrevocably agree that any action, whether at law or in equity,
arising out of or based upon this Agreement or the Executive’s employment by
the Company shall only be brought in a federal or state court located in Cook County,
Illinois.  The Executive hereby
irrevocably consents to personal jurisdiction in such court and to accept
service of process in accordance with the provisions of such court.  In connection with any dispute arising out of
or based upon this Agreement or the Executive’s employment by the Company, each
party shall be responsible for its or his own legal fees and expenses and all
court costs shall be shared equally by the Company and the Executive unless the
court apportions such legal fees or court costs in a different manner.

 

17.                                 Withholding.  All payments made to the Executive pursuant
to this Agreement shall be subject to applicable withholding taxes, if any, and
any amount so withheld shall be

 

 

deemed to have
been paid to the Executive for purposes of amounts due to the Executive under
this Agreement.

 

18.                                 Governing
Law.  This Agreement is governed by
and is to be construed and enforced in accordance with the laws of the State of
Illinois, without regard to its conflict of law provisions.

 

IN WITNESS WHEREOF, the parties have executed this Agreement on the
date and year first above written.

 

	
  EXECUTIVE

  	
  ADVANCED LIFE SCIENCES, INC.

  
	
   

  	
   

  
	
  By:

  	
  /s/ David A. Eizenhamer, Ph.D.

  	
   

  	
  By:

  	
  /s/ Michael T. Flavin

  	
   

  
	
   

  	
   

  
	
  Name: David A. Eizenhamer, Ph.D.

  	
  Name:

  	
  Michael T. Flavin

  
	
   

  	
  Title:

  	
  Chief Executive Officer

  
							

 

 

FIRST AMENDMENT TO
EMPLOYMENT AGREEMENT

 

This FIRST AMENDMENT TO EMPLOYMENT AGREEMENT (this “Amendment”)
is entered into as of this 18th day of November, 2005 by and between Advanced
Life Sciences, Inc., an Illinois corporation (“ALS”), and David A.
Eiznhamer, Ph.D. (the “Executive”) to amend the terms of that certain
Employment Agreement dated April 11, 2005 between ALS and the Executive
(the “Agreement”).

 

WHEREAS, ALS and the Executive entered into the Agreement on April 11,
2005;

 

WHEREAS, the parties wish to amend the Agreement as provided herein.

 

NOW, THEREFORE, in consideration of the foregoing recitals, the parties
hereto, intending to be legally bound, agree as follows:

 

1.               Incorporation
of the Agreement.  All capitalized
terms which are not defined herein shall have the same meanings as set forth in
the Agreement, and the Agreement, to the extent not inconsistent with this
Amendment, is incorporated herein by this reference as though the same was set
forth in its entirety.  To the extent any
terms and provisions of the Agreement are inconsistent with the amendments set
forth in Paragraph 2 below, such terms and provisions shall be deemed
superseded hereby.  Except as
specifically set forth herein, the Agreement shall remain in full force and
effect and its provisions shall be binding on the parties hereto.

 

2.               Amendment of the
Agreement.  The Agreement is hereby
amended as follows:

 

a.               Section 4(a) of
the Agreement shall be deleted in its entirety and replaced with the following
language:

 

“Salary.  The Company shall pay to the Executive an
annual base salary of $180,000 (“Base Salary”), payable in substantially equal
installments no less frequently than monthly in accordance with the Company’s
applicable payroll practices.  The amount
of Base Salary shall be reviewed annually by the Chief Executive Officer to
determine whether to increase the Base Salary on a prospective basis.  The Executive’s Base Salary shall not be
reduced after any increase, without the Executive’s consent.”

 

b.              Section 4(b) of
the Agreement shall be deleted in its entirety and replaced with the following
language:

 

“Bonus.  The Executive shall be eligible to
participate throughout the Term in the Company’s annual bonus plan or any similar or successor bonus
plan (“Bonus Plan”) in accordance with the Company’s compensation
practices and the terms and provisions of the

 

 

Bonus Plan.  During the 2006 fiscal year of the Company,
the maximum bonus that the Executive may receive is $75,000.”

 

3.               Effectuation.  Except as amended by this Amendment, the
provisions of the Agreement shall continue for all purposes without
interruption and the Agreement shall remain in full force and effect. The
amendment to the Agreement contemplated by this Amendment shall be deemed
effective as of November 1, 2005.

 

4.               Counterparts.  This Amendment may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.

 

[Signature Page Follows]

 

 

[Signature Page to
First Amendment to Employment Agreement]

 

IN WITNESS WHEREOF, the parties hereto have duly executed this
Amendment as of the date first above written.

 

 

	
  EXECUTIVE

  	
  ADVANCED LIFE SCIENCES, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ David A. Eizenhamer, Ph.D.

  	
   

  	
  By:

  	
  /s/ Michael T. Flavin

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Name: David A. Eizenhamer, Ph.D.

  	
  Name:

  	
  Michael T. Flavin

  
	
   

  	
  Title:

  	
  Chief Executive Officer

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