Exhibit 10.1
EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT
AGREEMENT is effective as
of this 14th day of April 2006 by and between LIPID SCIENCES, INC.,
a Delaware corporation (the “ Company ”), and S.
LEWIS MEYER, Ph.D., an individual (the “ Employee
”).
W I T N E S S E T
H:
WHEREAS , the Company desires to continue to employ the
Employee in the manner hereinafter specified and to make provision
for payment of reasonable compensation to the Employee for such
services, and the Employee is willing to be employed by the Company
to perform the duties incident to such employment upon the terms
and conditions hereinafter set forth; and
WHEREAS , the parties desire to enter into this
Agreement as of the Effective Date (as hereinafter defined),
setting forth the terms and conditions of the employment
relationship of the Employee with the Company during the Term (as
hereinafter defined).
NOW, THEREFORE
, in consideration of the foregoing
premises, the mutual covenants, terms and conditions set forth
herein, and other valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
1.
EMPLOYMENT AND DUTIES
(a)
General . Effective as of the Effective Date, the
Company hereby employs the Employee as Chief Executive Officer and
President of the Company and the Employee agrees upon the terms and
conditions herein set forth to be employed by the Company.
The Employee shall diligently perform all of the duties normally
accorded to such position and shall report directly to the Board of
Directors of the Company (the “ Board ”).
(b)
Services . During the Term, the Employee shall well
and faithfully serve the Company, and shall devote substantially
all of his business time and attention to the performance of the
duties of such employment and the advancement of the best interests
of the Company and shall not, directly or indirectly, render
services to any other person or organization for which he receives
compensation without the prior written approval of the Board.
No such approval shall be required in connection with services the
Employee performs with respect to other persons and entities,
including, but not limited, to Lexrite Labs and the Ambient Capital
Group, provided that the aggregate amount of time spent on these
services does not exceed a maximum of eight hours per week and that
such services do not contravene the provisions of Section 5
hereof. The Employee hereby agrees to refrain from engaging
in any activity that does, shall or could reasonably be deemed to
conflict with the best interests of the Company.
(c)
Location of Employment . The Employee’s place of
employment shall be at the office of the Company located in
Pleasanton, California, but the Employee shall travel to the extent
and to the places necessary for the performance of his duties to
the Company.
2.
TERM OF EMPLOYMENT
The term of the Employee’s
employment under this Agreement shall commence on April 14, 2006
(the “ Effective Date ”) and continue until the
second anniversary thereof (the “ Term
”).
3.
COMPENSATION AND OTHER BENEFITS
Subject to the provisions of this
Agreement including without limitation the termination provisions
contained in Section 4, the Company shall pay and provide the
following compensation and other benefits to the Employee during
the Term as compensation for all services rendered
hereunder:
(a)
Salary . The Company shall pay to the Employee a
salary (the “ Salary ”) at a rate of
$290,000 per annum, payable to the Employee in accordance with the
normal payroll practices of the Company as are in effect from time
to time. The amount of the Salary shall be reviewed annually
by the Compensation Committee of the Board and may be increased on
the basis of the review.
(b)
Annual Performance Bonus . The Employee shall be
eligible to earn an annual discretionary cash bonus (the
“ Annual Bonus
”) in an
amount and subject to such other terms and conditions, including
performance objectives, as are determined, by the
Board.
(c)
Expenses . The Company shall pay or reimburse the
Employee for all reasonable out-of-pocket expenses incurred by the
Employee in connection with his employment hereunder upon
submission of appropriate documentation or receipts in accordance
with the policies and procedures of the Company as are in effect
from time to time. No expense payment or reimbursement under
this Section 3(d) shall be “grossed up” or increased to
take into account any tax liability incurred by the Employee as a
result of such payment or reimbursement.
(d)
Retirement, Welfare and Fringe Benefits . The Employee
shall be eligible to participate in the retirement, medical,
disability and life insurance plans applicable to senior officers
of the Company generally in accordance with the terms of such plans
as in effect from time to time. The foregoing shall not be
construed to limit the ability of the Company or any of its
affiliates to amend, modify or terminate any such benefit plans,
policies or programs at any time and from time to time.
(e)
Vacation . The Employee shall be entitled to annual
vacation in accordance with the Company’s policies applicable
to senior officers of the Company generally as are in effect from
time to time.
4.
TERMINATION OF EMPLOYMENT
Subject to the notice and other
provisions of this Section 4, the Company shall have the right to
terminate the Employee’s employment hereunder, and the
Employee shall have the right to resign, at any time for any reason
or for no stated reason.
(a)
Termination for Cause or Resignation . (i) If,
prior to the expiration of the Term, the Employee’s
employment is terminated by the Company for “Cause” (as
hereinafter
2
defined) or if
the Employee resigns from his employment hereunder, the Employee
shall be entitled to payment of (A) his Salary accrued up to and
including the date of termination or resignation, and (B) any
unreimbursed expenses. Except to the extent required by the
terms of the benefits provided under Section 3(e) or applicable
law, the Employee shall have no right under this Agreement or
otherwise to receive any other compensation or to participate in
any other plan, program or arrangement after such termination or
resignation of employment with respect to the year of such
termination or resignation and later years.
(ii)
Termination for “Cause” shall mean a termination of the
Employee’s employment with the Company because of (A) a plea
of guilty or nolo contendere to, or conviction for, the
commission of a felony offense by the Employee; (B) the involvement
by the Employee as a party to any litigation or regulatory
proceeding or in any other circumstance known to the general public
that, in the good faith determination of the Board, is reasonably
certain to subject the Employee, the Company or its affiliates to
disrepute, ridicule, contempt or scandal or that is reasonably
certain to reflect unfavorably upon the reputation of the Employee,
the Company or its affiliates or the Company’s products or
technologies; (C) the willful and continued failure to perform in
any material respect the Employee’s duties; (D) an
intentional act of fraud, embezzlement, theft or a material and
dishonest act against the Company or its affiliates; or (E) a
material breach by the Employee of the terms and provisions of the
Agreement.
(iii)
Termination of the Employee’s employment for Cause shall be
communicated by delivery to the Employee of a written notice from
the Company stating that the Employee will be terminated for Cause,
specifying the particulars thereof and the effective date of such
termination. In the cases of Sections 4(a)(ii)(B),
4(a)(ii)(C) and 4(a)(ii)(E), the Employee shall have thirty (30)
business days from the date of receipt of such notice to effect a
cure of the actions constituting Cause, or to effect a cure of the
adverse effect such actions. Upon cure or correction thereof
by the Employee to the reasonable satisfaction of the Company, the
action shall no longer constitute Cause for purposes of this
Agreement. The date of a resignation by the Employee shall be
the date specified in a written notice of resignation from the
Employee to the Company. The Employee shall provide at least
90 days’ advance written notice of his
resignation.
(b)
Termination without Cause .
(i)
If, prior to the expiration of the Term, the Company terminates the
Employee’s employment for any reason other than Disability or
Cause (such termination or resignation being hereinafter referred
to as a “ Termination
without Cause ”), the Employee shall
be entitled to (A) payment of hi
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