EXHIBIT 10.6
EMPLOYMENT AGREEMENT
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This Employment Agreement is entered into as of January 21, 1998 (the
"Effective Date"), by and between XENOGEN CORPORATION, a California corporation
(the "Company"), and XXXXXX XXXXXX (the "Employee").
1. At-Will Employment. The Employee's employment with the Company is for
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an unspecified duration and constitutes "at-will" employment. The Employee
acknowledges that the employment relationship may be terminated at any time,
with or without good cause or for any or no cause, at the option either of the
Company or the Employee, with or without notice. Employee will devote her full
business time and attention to her employment with the Company hereunder.
2. Salary. For all services to be rendered by the Employee to the
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Company, the Company agrees to pay the Employee an annual salary of $175,000 in
accordance with the Company's standard payroll policies.
3. Benefits. During the Employee's employment with the Company, the
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Employee shall be entitled to participate in employee benefit plans or programs
of the Company ("Benefit Plans"), if any, to the extent that the Employee's
position, tenure, salary, age, health and other qualifications make the Employee
eligible to participate, subject to the rules and regulations applicable
thereto.
4. Automobile Allowance. The Company will provide the Employee with an
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automobile allowance of $600 per month; provided, however, that such allowance
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will be terminated (i) on the date on which the Employee's employment with the
Company ceases, either voluntarily or involuntarily or (ii) after December 31,
1998 upon the affirmative action of the Board of Directors.
5. Home Mortgage Assistance.
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(a) At any time prior to December 31, 1998, the Company will loan the
Employee $100,000 (the "Loan") to be evidenced by a promissory note bearing
interest at the rate of 6% per annum and secured by a Deed of Trust on the home.
The Loan will only be made contemporaneously with or following the purchase by
Employee of a home in reasonable proximity to the Company's principal offices in
Alameda, where employee is employed. Provided that the Employee's employment
has not been terminated prior to the applicable date (either voluntarily or
involuntarily), the Loan will be forgiven as follows: (i) on January 1, 1999,
$15,000 of principal and all accrued interest, (ii) on January 1, 2000, $15,000
of principal and all accrued interest, (iii) on January 1, 2001, $15,000 of
principal and all accrued interest and (iv) on January 1, 2002, $55,000 and all
accrued interest.
(b) Notwithstanding Section 5(a), the Loan is payable within ninety
(90) days of the earlier of: (i) the date on which the Employee's employment
with the Company ceases, either voluntarily or involuntarily or (ii) the date on
which the Employee sells the property securing such Loan.
6. Termination of Employment.
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(a) Voluntary Resignation/Termination For Cause. If the Employee
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voluntarily resigns or is terminated by the Company for Cause (as defined
below), then:
(i) no salary will be paid for the periods following the date
of termination;
(ii) no benefits will be paid or provided for the periods
following the date of termination; and
(iii) the number of shares exercisable under the Employee's
outstanding options, if any, and the Company's right to repurchase the
Employee's outstanding Common Stock shall be measured as of the date of
termination.
(b) Termination Without Cause. If the Employee is terminated by the
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Company without Cause (as defined below) within one year from the date of the
Agreement, then:
(i) the Employee's annual salary will continue to be paid in
accordance with the Company's standard payroll policies for six months following
the date of termination;
(ii) the Employee will continue to receive benefits pursuant to
the Company's Benefit Plans, provided that such Benefit Plans permit
continuation post-termination, at the Company's expense for six months following
the date of termination; and
(iii) the number of shares exercisable under the Employee's
outstanding options, if any, and the Company's right to repurchase the
Employee's outstanding Common Stock shall be measured as if the termination
occured six months from the actual date of termination; provided, however, that
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the Company's right to repurchase 100,000 shares of Common Stock issued to the
Employee in conjunction with the Series C Preferred Stock Purchase Agreement of
even date herewith and subject to that certain Restricted Stock Purchase
Agreement of even date herewith shall be determined as of the actual date of
termination.
The post-employment payments and benefits under Sections 6(b)(i) and (ii)
shall be terminated prior to one year from the date of termination upon the
acceptance by the Employee of new employment.
(c) Termination Without Cause. If the Employee is terminated by the
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Company without Cause (as defined below) following one year from the date of
this Agreement and prior to two years from the date of this Agreement, then:
(i) the Employee's annual salary will continue to be paid in
accordance with the Company's standard payroll policies for nine months
following the date of termination;
(ii) the Employee will continue to receive benefits pursuant to
the Company's Benefit Plans, provided that such Benefit Plans permit
continuation post-termination, at the Company's expense for nine months
following the date of termination; and
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(iii) the number of shares exercisable under the Employee's
outstanding options, if any, and the Company's right to repurchase the
Employee's outstanding Common Stock shall be measured as if the termination
occured nine months from the actual date of termination; provided, however, that
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the Company's right to repurchase 100,000 shares of Common Stock issued to the
Employee in conjunction with the Series C Preferred Stock Purchase Agreement of
even date herewith and subject to that certain Restricted Stock Purchase
Agreement of even date herewith shall be determined as of the actual date of
termination.
The post-employment payments and benefits under Sections 6(c)(i) and (ii)
shall be terminated prior to one year from the date of termination upon the
acceptance by the Employee of new employment.
(d) Termination Without Cause. If the Employee is terminated by the
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Company without Cause (as defined below) following two years from the date of
this Agreement, then:
(i) the Employee's annual salary will continue to be paid in
accordance with the Company's standard payroll policies for one year following
the date of termination;
(ii) the Employee will continue to receive benefits pursuant to
the Company's Benefit Plans, provided that such Benefit Plans permit
continuation post-termination, at the Company's expense for one year following
the date of termination; and
(iii) the number of shares exercisable under the Employee's
outstanding options, if any, and the Company's right to repurchase the
Employee's outstanding Common Stock shall be measured as if the termination
occured one year from the actual date of termination; provided, however, that
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the Company's right to repurchase 100,000 shares of Common Stock issued to the
Employee in conjunction with the Series C Preferred Stock Purchase Agreement of
even date herewith and subject to that certain Restricted Stock Purchase
Agreement of even date herewith shall be determined as of the actual date of
termination.
The post-employment payments and benefits under Sections 6(d)(i) and (ii)
shall be terminated prior to one year from the date of termination upon the
acceptance by the Employee of new employment.
(e) As used in this Agreement, Cause shall mean:
(i) the Employee's failure to substantially perform the duties
associated with the Employee's position;
(ii) the Employee's personally engaging in conduct that the
Employee reasonably should know or that the Employee intends to be seriously
injurious to the Company, its affiliates or employees;
(iii) a material and willful violation of a federal or state law
or regulation applicable to the business of the Company;
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(iv) the Employee's 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
(v) the Employee knowingly and intentionally breaching in any
material respect the terms of the Employee's Proprietary Information Agreement.
7. Arbitration. Any dispute or controversy arising under or in connection
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with this Agreement shall be settled exclusively by arbitration in Palo Alto,
California, in accordance with the rules of the American Arbitration Association
then in effect by an arbitrator selected by both parties within 20 days after
either party has notified the other in writing that it desires a dispute between
them to be settled by arbitration. In the event the parties cannot agree on
such arbitrator within such 20-day period, each party shall select an arbitrator
and inform the other party in writing of such arbitrator's name and address
within 5 days after the end of such 20-day period and the two arbitrators so
selected shall select a third arbitrator within 15 days thereafter; provided,
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however, that in the event of a failure by either party to select an arbitrator
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and notify the other party of such selection within the time period provided
above, the arbitrator selected by the other party shall be the sole arbitrator
of the dispute. Each party shall pay its own expenses associated with such
arbitration, including the expense of any arbitrator selected by such party and
the Company will pay the expenses of the jointly selected arbitrator. The
decision of the arbitrator or a majority of the panel of arbitrators shall be
binding upon the parties and judgment in accordance with that decision may be
entered in any court having jurisdiction thereover. Punitive damages shall not
be awarded.
8. Notices. For purposes of this Agreement, notices and other
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communications provided for in this Agreement shall be in writing and shall be
delivered personally or sent by United States certified mail, return receipt
requested, postage prepaid, to the address set forth on the signature pages to
this Agreement.
9. Applicable Law. This Agreement shall be governed by and construed in
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accordance with the internal substantive laws of the State of California without
reference to choice or conflicts of laws.
10. Counterparts. This Agreement may be executed in one or more
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counterparts, none of which need contain the signature of more than one party
hereto, and each of which shall be deemed to be an original, and all of which
together shall constitute a single agreement.
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IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the
case of the Company by its duly authorized officer, as of the day and year first
above written.
"COMPANY" "EMPLOYEE"
By: /s/ Xxxxx X. Xxxxxx /s/ Xxxxxx Xxxxxx Contag
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Xxxxxx Xxxxxx
Title: __________________________
Address: Address:
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