EMPLOYMENT AGREEMENT
Exhibit 10.3
This EMPLOYMENT AGREEMENT (the “Agreement”) is made as of the 21st day of March 2006 between
Sentigen Holding Corp., a Delaware corporation (the “Company”) and G. Xxxxx Xxxxxx (the
“Employee”).
RECITALS
WHEREAS, the Employee has been employed by the Company since September 19, 2005 formerly as
its Vice President, Finance and effective as of January 1, 2006 as its Chief Financial Officer;
WHEREAS, the Employee desires to continue to be employed by the Company upon the terms and
conditions hereinafter set forth; and
WHEREAS, the Company desires to continue to employ the Employee upon the terms and conditions
hereinafter set forth.
WITNESSETH:
NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein, the
parties hereto, each intending to be legally bound hereby, agree as follows:
1. Employment.
During the Employment Term (as defined below), the Employee shall serve as the Chief Financial
Officer of the Company and its subsidiaries with the authority and responsibilities typically
associated with such position, and shall report to and perform such duties as are assigned by
Xxxxxx X. Xxxxxxx, the Company’s Chief Executive Officer and President, and the Board of Directors
of the Company (the “Board”).
2. Performance.
(a) The Employee shall devote his entire business efforts, time, attention, skill and energy
exclusively to the performance of his duties hereunder.
(b) The Employee represents and covenants to the Company that he is not subject or a party to
any employment agreement, non-competition covenant, non-disclosure agreement, consulting or any
similar agreement, covenant, understanding or restriction that would prohibit the Employee from
executing this Agreement and performing his duties and responsibilities hereunder, or that would in
any manner, directly or indirectly, limit or affect the duties and responsibilities that may now or
in the future be assigned to the Employee by the Company.
(c) The Employee shall at all times comply with policies and procedures adopted by the Company
for its employees, including without limitation the procedures and policies adopted
by the Company regarding conflicts of interest, but only to the extent such policies are not
in conflict with the express provisions of this Agreement.
3. Term.
The employment term of this Agreement shall commence as of the date of this Agreement and
shall continue for one year thereafter (the “Employment Term”), except as provided in
Section 10 hereof.
4. Base Compensation; Bonus.
(a) For all services rendered by the Employee hereunder, the Company shall pay the Employee
an annual salary at the rate of $175,000 for the Employment Term (the “Salary”), plus such
additional amounts, if any, as may be approved by the Board, less withholding required by law or
agreed to by the Employee, payable in installments at such times the Company customarily pays its
other senior officers (but in any event no less often than monthly). The Salary shall be reviewed
at least annually by the Board to determine if an increase (but not a decrease) is appropriate,
which increase shall be in the sole discretion of the Board. The Employee alone, and not the
Company, shall be responsible for the payment of all federal, state and local taxes in respect of
the payments to be made and benefits to be provided under this Agreement or otherwise (except to
the extent withheld or required to be withheld by the Company).
(b) The Employee may receive bonuses on such dates, in such amounts and on such other terms
as may be determined by the Board in its sole discretion.
(c) The Employee shall be entitled to a car allowance of $800 per month during the Employment
Term.
5. Expenses.
The Employee shall be reimbursed for the reasonable business expenses incurred by him in
connection with his performance of services hereunder during the Employment Term to the extent that
such expenses are customarily paid to senior officers by the Company upon presentation of an
itemized account and written proof of such expenses.
6. Other Benefits.
The Employee shall be entitled to participate in and receive any fringe benefits customarily
provided by the Company to its employees of comparable standing with the Employee (including, but
not limited to, any profit-sharing, pension, hospital, major medical insurance and group life
insurance plans as in effect from time to time in accordance with the terms of such plans), all as
determined from time to time by the Board; provided, however, that the Company has no obligation to
provide these benefits to its employees.
7. Confidential Information.
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(a) The Employee agrees that the Confidential Information is the Company’s exclusive property
and shall not be copied or removed from the Company’s premises except for Company business.
(b) The Employee will not, without the Company’s prior written permission, disclose to anyone
outside of the Company or use in other than the Company’s business, either during or after the term
of his employment with the Company, any Confidential Information. If the Employee leaves the employ
of the Company, the Employee will return all copies of any Confidential Information to the Company.
(c) The Employee will hold all third-party confidential or proprietary information in the
strictest confidence and do all things necessary for the Company to comply with the provisions of
all contracts to which the Company is a party.
(d) For the purposes of Sections 7, 8 and 9 hereof:
(1) “Confidential Information” shall mean confidential or other proprietary information
received, developed or learned by the Employee in connection with his employment with the Company,
including without limitation, all data, reports, interpretations, research and development,
forecasts, records, agreements, contracts and other documents (whether written or oral, and whether
prepared by or on behalf of the Company) containing or otherwise reflecting information concerning
the Company, its subsidiaries, affiliates, clients, customers, investors, joint venture and
strategic partners, including without limitation, financial information, trade secrets, proprietary
technology, strategies, studies, know-how, techniques, marketing plans and opportunities, cost and
pricing data, forecasts, inventions, customer lists, developments, improvements, discoveries,
patents, patent applications, technologies, processes, formulaes, research, methods, procedures,
designs, models, testing systems, computer software and programs (including source code and related
documentation), test and/or experimental data and results, laboratory notebooks, drawings and
technical information and materials and other confidential business information. Confidential
Information shall not include any portion of the Confidential Information which (a) is or becomes
generally available to the public other than as a result of a disclosure or any improper action or
inaction by the Employee, (b) becomes available to the Employee on a non-confidential basis from a
source other than the Company or its representatives which has represented to the Employee (and
which Employee has no reason to disbelieve after due inquiry) that it is entitled to disclose it,
or (c) was in the possession of or was known to the Employee on a non-confidential basis prior to
the disclosure thereof to the Employee by the Company or its representatives.
(2) “Developments” shall mean any trade secret, idea, invention, improvement, patent, patent
application, novel technique, design of a useful article (whether the design is ornamental or
otherwise), computer program (including source and object code), data base, documentation and
original works of authorship.
8. Assignment of Inventions and Original Works.
(a) The Employee hereby assigns to the Company or to any party designated by the Company the
entire right, interest and title to all Developments made, conceived or first reduced
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to practice solely or jointly by the Employee, whether or not such Developments are
patentable, copyrightable or developed during normal working hours, which: (i) were made, conceived
or first reduced to practice in the course of performance of the Employee’s employment duties, or
with the use of the Company’s time, materials, funds or facilities; or (ii) are directly related to
information, technology or investigations of the Company to which the Employee has access as part
of work for the Company. The Employee acknowledges that all original works of authorship which are
made by the Employee within the scope of his Employment and which are protectable by copyright are
“works made for hire,” within the meaning of 17 U.S.C. § 10 1.
(b) In connection with any of the Developments assigned by Section 8(a) hereof, the Employee
will (i) promptly disclose them to the Company and (ii) on request of the Company, promptly execute
an assignment to the Company and do anything else necessary to enable the Company to secure a
patent, copyright or other form of protection therefor. Employee waives and releases, to the extent
permitted by law, all rights to the foregoing.
9. Non-Competition.
(a) During the Employment Term, the Employee will not, directly or indirectly, engage in any
activity competitive with or adverse to the Company’s business or welfare, whether alone or as a
principal, employee or consultant of or to any other person or entity.
(b) Upon termination of his employment, the Employee will return all Confidential Information
and all product specifications, documentation, customer lists, and all other Company property and
will not remove or retain any product specifications, documentation, customer lists, letters,
papers or copies thereof or any other Confidential Information. All of the above-described
documents made available to the Employee by the Company or made or compiled by the Employee and all
copies thereof are and shall remain the sole and exclusive property of the Company and shall be
delivered to the Company on the termination of the Employee’s employment or at any other time upon
request of the Company.
(c) Upon termination of his employment for any reason (other than for “good reason” or for
termination “without cause” as set forth in (d) below), the Employee will not, for a period of
twelve months after the date of termination:
(1) unless acting pursuant hereto or with the prior written consent of the Chief Executive
Officer of the Company, directly or indirectly, own, manage, operate, join, control, finance or
participate in the ownership, management, operation, control or financing of, or be connected as an
officer, director, employee, partner, principal, agent, representative, consultant or otherwise
with or use or permit his name to be used in connection with, any business or enterprise engaged
within any portion of the United States or Canada (whether or not such business is physically
located within the United States or Canada) and any other country where the Company does business
during the Employment Term (the “Territory”) in any business whose products, services or
activities compete, directly or indirectly, in whole or in part with the products, services or
activities of the Company or its subsidiaries at the date of termination of Employee’s employment
by the Company or at any time within one year prior thereto. Without limiting the foregoing, the
current products, services and activities of the Company shall be deemed to include, without
limitation, (i) contract research and development services to the drug
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discovery community in the areas of molecular and cellular biology, protein biochemistry,
bio-processing, high throughput screening and assay development and mouse genetics; (ii) research
products including media and reagents for culture of mouse embryos, murine embryonic stem cells and
reagents, reagents for gene transfer and expression and cell culture media; and (iii) development
of assays for the screening of G Protein-Coupled Receptors and other target classes and
pharmaceutical discovery efforts utilizing such technology;
(2) directly or indirectly solicit or request any customer of the Company to transfer its
business from the Company to any other person or entity; or
(3) directly or indirectly induce or attempt to influence any present or future employee of
the Company to terminate his or her employment with the Company.
(d) In the event Employee’s employment is terminated for “good reason” or “without cause” as
defined in Section 10 herein, the provisions of Section 9(c) will remain in effect for six months
after the date of termination.
(e) It is recognized by Employee that the business of the Company and Employee’s connection
therewith is or will be involved in activity throughout the Territory, and that more limited
geographical limitations on the covenants contained in Section 9(c) hereof are therefore not
appropriate.
(f) In the event that any of the provisions of this Section 9 should ever be deemed to exceed
the temporal, geographic or occupational limitations established by applicable law, then such
provision shall be reformed to the maximum temporal, geographic or occupational limitations
established by applicable law.
(g) Employee agrees that his obligations under this Section 9 shall survive and be enforceable
after termination of his employment.
10. Termination.
The Employment Term, the Salary, and any and all other rights of the Employee under this
Agreement or otherwise as an employee of the Company will terminate (except as otherwise provided
in this Section 10):
(a) if the Employee becomes totally disabled (as defined below), and thereafter the Company
shall have no further liability or obligation to the Employee hereunder except as follows: the
employee shall receive (i) any unpaid Salary that has accrued through the date of termination; (ii)
continued Salary for six (6) months following the date he is considered totally disabled; and (iii)
whatever benefits that he may be entitled to receive under any then existing disability benefit
plans of the Company. For the purposes hereof, the Employee shall be deemed to be “totally
disabled” if the Employee is considered totally disabled under the Company’s group disability plan
in effect at that time, if any, or in the absence of any such plan, under applicable Social
Security regulations. In the event of any dispute as to the disability of the Employee under this
Section 10(a), the Employee shall submit to a physical examination by a licensed physician mutually
satisfactory to the Company and the Employee, the cost of such
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examination to be paid by the Company, and the determination of such physician shall be
determinative.
(b) if the Employee dies, and thereafter the Company shall not have any further liability or
obligation to the Employee, his executors, administrators, heirs, assigns or any other person
claiming under or through him except that the Employee’s estate shall receive any unpaid Salary
that has accrued through the date of termination and any other benefits due Employee as outlined in
Section 6.
(c) for “cause” immediately upon notice from the Company of the termination date (other than
termination provided in (d) or (e) of this Section 10) or upon receipt by the Company of notice of
termination from Employee other than “for good reason” (as defined below), and thereafter the
Company shall not have any further liability or obligation to the Employee, except that the
Employee shall receive any unpaid Salary that has accrued through the date of termination, net of
any liabilities that the Employee may have to the Company. For purposes of this Agreement, “cause”
shall mean (i) the failure of the Employee to observe or perform (other than by reason of illness,
injury or incapacity) any of the material terms or provisions of this Agreement; (ii) the
Employee’s failure to adhere to any material written policy of the Company unless such policy
conflicts with this Agreement if the Employee has been given a reasonable opportunity to comply
with such policy or cure his failure to comply; (iii) Employee’s habitual or willful neglect or
disregard of directives of the Chief Executive Officer or the Board; (iv) the appropriation (or
attempted appropriation) of a business opportunity of the Company, including attempting to secure
or securing any personal profit in connection with any transaction entered into on behalf of the
Company; (v) the misappropriation (or attempted misappropriation) of any of the Company’s funds or
property; or (vi) dishonesty, willful misconduct, neglect of the Company’s business, act of moral
turpitude which tends to reflect unfavorably on the Company, fraud, embezzlement or habitual
insobriety.
(d) “without cause” at any time by giving the Employee 30 days’ notice of the termination
date. Under such circumstances, the Company will continue to pay to Employee, over time as he
would have been paid pursuant to this Agreement, the Salary under Section 4 for the remainder of
the Employment Term (which amount shall be paid, over time pursuant to this Agreement) and the
Company shall continue any benefits Employee is receiving at the time of such termination for such
period. The Employee shall not be entitled to any compensation under this Section 10(d) unless the
Employee executes and delivers to the Company (after notice of termination) a release in a form
reasonably satisfactory to the Company by which the Employee releases the Company from any
obligations and liabilities of any type whatsoever, except for the Company’s obligation to provide
the Salary, specified in this Section 10(d). The parties hereto acknowledge that the Salary to be
provided under this Section 10(d) is to be provided in consideration for the above-specified
release.
(e) “for good reason” at any time with 30 days’ notice if (i) without Employee’s express
written consent, any failure by the Company to comply with any material provision of this
Agreement, which failure has not been cured within 10 business days after notice of such
non-compliance has been given by Employee to the Company; (ii) the occurrence (without Employee’s
express written consent which consent shall not be unreasonably withheld) during the Employment
Term of any change in Employee’s responsibilities which, in the judgment of a
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reasonably prudent person, represents a materially adverse change in his responsibilities,
except if such change is because of total disability, retirement, death or for cause; (iii) the
relocation of Employee’s office to a location more than 100 miles from the location or locations at
which Employee performed his duties previously, except for required travel on the Company’s
business to the extent substantially consistent with Employee’s normal business travel obligations
and except as agreed to by the Company and Employee; or (iv) any reduction in Employee’s annual
Salary. Under such circumstances, the Employee shall be subject to the restrictions set forth in,
and shall be entitled to the compensation provided in, Section 10(d).
(f) in the event that a Change of Control (as defined below) shall occur during the Employment
Term then, under such circumstances, the Company (or its successor) will continue pay to Employee,
the Salary under Section 4 (less applicable withholding) for a period of twelve months (commencing
after any three month period referenced below) in installments at such times as the Company (or its
successor) customarily pays its other senior officers and the Company shall continue any benefits
Employee is receiving at the time of such termination for such period; provided, that Employee
agrees to remain employed with the Company (or its successor) for a period of three months
following such Change in Control if so requested by the Company (or its successor). For purposes
hereof, a “Change of Control” shall be deemed to occur if any “person” (as such term is used in
Sections 13(d) and 14(d) of the Exchange Act of 1934 (“Exchange Act”)), other than the
Company or an affiliate of the Company, becomes the “beneficial owner” (as referred in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Company representing more
than 50% of the voting power of the Company’s securities in one or more transactions (including by
way of merger or reorganization), or a sale of all or substantially all of the Company’s assets.
The Employee shall not be entitled to any compensation under this Section 10(f) unless the Employee
executes and delivers to the Company a release in a form reasonably satisfactory to the Company by
which the Employee releases the Company from any obligations and liabilities of any type
whatsoever, except for the Company’s obligation to provide the Salary specified in this Section
10(f). The parties hereto acknowledge that the Salary to be provided under this Section 10(f) is to
be provided in consideration for the above-specified release.
11. Offset.
The Company, in addition to all other rights and remedies, shall have the right to offset
against all moneys due to the Employee any sums due to the Company from the Employee under this
Agreement.
12. Remedies.
(a) The Employee expressly acknowledges that the remedy at law for any breach of Sections 7, 8
and 9 may cause irreparable harm to the Company, that the Company’s remedies at law for his breach
of Sections 7, 8 and 9 will be inadequate, and that upon any such breach or threatened breach, the
Company shall be entitled as a matter of right to injunctive relief in any court of competent
jurisdiction, in equity or otherwise, and to enforce the specific performance of the Employee’s
obligations under these provisions without the necessity of proving the actual damage to the
Company or the inadequacy of a legal remedy. Subject to the remainder of this Section 12, the
rights conferred upon the Company by the preceding sentence shall not be
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exclusive of, but shall be in addition to, any other rights or remedies which the Company may
have at law, in equity or otherwise.
(b) The Employee agrees that the Company shall be entitled to preliminary and permanent
injunctive relief, without the necessity of proving actual damages, as well as an equitable
accounting of all earnings, profits and other benefits arising from any violation of Sections 7, 8
and 9 hereof, which rights shall be cumulative and in addition to any other rights or remedies to
which the Company may be entitled.
(c) In the event of a lawsuit by either party to enforce the provisions of this Agreement,
including, but not limited to, Sections 7, 8 and 9 hereof, the prevailing party shall be entitled
to recover reasonable costs, expenses and attorney’s fees from the other party.
13. General.
(a) The terms of this Agreement shall be governed by the laws of the State of New York,
disregarding any principles of conflicts of law that would otherwise provide for the application of
the substantive law of another jurisdiction. Each of the parties (i) agrees that any legal suit,
action or proceeding arising out of or relating to this Agreement shall be instituted exclusively
in New York State Supreme Court, County of New York, or in the United States District Court for the
Southern District of New York, (ii) waives any objection to the venue of any such suit, action or
proceeding and the right to assert that such forum is not a convenient forum, and (iii) irrevocably
consents to the jurisdiction of the New York State Supreme Court, County of New York, and the
United States District Court for the Southern District of New York in any such suit, action or
proceeding. Each of the parties further agrees to accept and acknowledge service of any and all
process which may be served in any such suit, action or proceeding in the New York State Supreme
Court, County of New York, or in the United States District Court for the Southern District of New
York and agrees that process upon it mailed by certified mail to its address shall be deemed in
every respect effective service of process upon it in any such suit, action or proceeding.
(b) For purposes of Sections 7, 8, 9 and 12, the term “Company” shall be deemed to include any
incorporated or unincorporated subsidiaries or affiliates of the Company and any majority-owned
subsidiaries thereof, including without limitation, Cell & Molecular Technologies, Inc. and
Sentigen Biosciences, Inc.
(c) All notices required to be given under this Agreement shall be in writing and shall be
deemed to have been given when personally delivered or when mailed by registered or certified mail,
postage prepaid, return receipt requested, or when sent by Federal Express or other overnight
delivery service, addressed as follows:
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TO THE EMPLOYEE:
G. Xxxxx Xxxxxx
000 Xxxx 00 Xxxxxx
Xxxxxxxxx # 00X
Xxx Xxxx, Xxx Xxxx 00000
000 Xxxx 00 Xxxxxx
Xxxxxxxxx # 00X
Xxx Xxxx, Xxx Xxxx 00000
TO THE COMPANY:
Attention: Chief Executive Officer
with a copy to:
Xxxxxxx X. Xxxxxxx
Xxxxxxxxx & Xxxxxxxx L.L.P.
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Xxxxxxxxx & Xxxxxxxx L.L.P.
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
(d) This Agreement supersedes all prior agreements and sets forth the entire understanding
among the parties hereto with respect to the subject matter hereof and may not be modified or
amended in any way except upon written amendment mutually agreed and executed by the Company and
Employee. Without limitation, nothing in this Agreement shall be construed as giving the Employee
any right to be retained in the employ of the Company beyond the expiration of the Employment Term.
(e) All of the terms and provisions of this Agreement shall be binding upon and inure to the
benefit and be enforceable by the respective heirs, representatives, successors (including any
successor as a result of a merger or similar reorganization) and assigns of the parties hereto,
except that the duties and responsibilities of the Employee hereunder are of a personal nature and
shall not be assignable in whole or in part by the Employee.
(f) Notwithstanding the termination of this Agreement and of the Employee’s employment by the
Company, by reason of the Employee’s disability under Section 10(a) hereof, or for cause under
Section 10(c) hereof, or by expiration of the Employment term, this Agreement shall continue to
bind the parties for so long as any obligations remain under the terms of this Agreement.
(g) No waiver of any breach of this Agreement shall be construed to be a waiver as to
succeeding breaches.
(h) If any provision of this Agreement or application thereof to anyone under any
circumstances is adjudicated to be invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect any other provisions or applications of this Agreement which
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can be given effect without the invalid or unenforceable provision or application and shall
not invalidate or render unenforceable such provision in any other jurisdiction.
(i) All section headings are for convenience only and shall not define or limit the provisions
of this Agreement.
(j) This Agreement may be executed in one or more counterparts, each of which shall be deemed
an original and shall be binding as of the date first written above, and all of which shall
constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto, intending to be legally bound, have hereunto duly
executed this Employment Agreement as of the day and year first written above.
SENTIGEN HOLDING CORP. |
||||
| By: | /s/ Xxxxxx X. Xxxxxxx | |||
| Name: Xxxxxx X. Xxxxxxx | ||||
| Title: President and CEO | ||||
| /s/ G. Xxxxx Xxxxxx | ||||
| G. Xxxxx Xxxxxx | ||||
