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EMPLOYMENT
AGREEMENT
This Employment
Agreement ("Agreement") is made between ALAN ROBERTS (the
"Employee" or "you") and AURIGA LABORATORIES, INC., a Delaware
corporation, along with its subsidiaries, parents, affiliated
entities, and includes its successors and assigns or any such
related entities (the "Company"). In consideration set forth below,
both parties agree as follows:
1. Term of Employment . Your
employment under this Agreement shall commence on March 5, 2007,
and this Agreement shall commence as of that date. The parties
expressly understand that nothing in this Agreement is a guarantee
or assurance of employment for any specific period of time. Rather,
you understand that you are an at-will employee, and that the
Company may terminate your employment at any time, and you are
similarly free to resign at any time. The parties also expressly
understand that the terms and conditions in Section 3 below
do not guarantee employment for any specific period of time or
otherwise alter your at-will employment status but are solely
included to set forth amounts and benefits potentially available to
you at the cessation of your employment.
2. Nature of Duties . You
shall hold the position of "Chief Scientific Officer" and shall
receive future wages and employment benefits, payment of which
during the period of your employment is a condition of this
Agreement. You shall also devote your full business time and effort
to the performance of your duties for the Company, which you shall
perform faithfully and to the best of your ability. During your
employment, you shall not render services in any capacity to any
other person or entity and shall not act as a sole proprietor or
partner of any other person or entity or as a shareholder owning
more than five percent of the stock of any other corporation,
without the prior written approval of the Company’s Board of
Directors. You shall be subject to the Company’s policies,
procedures and approval practices, as generally in effect from
time-to-time.
3. Compensation and Related
Matters . In consideration of your execution of this Agreement,
you shall be entitled to the following:
a.
Base Salary . The Company shall pay you a base salary at a
gross annual rate of $205,000.00. Base salary shall be paid
bi-weekly.
b.
Monthly Car Allowance. The Company shall pay you a monthly
car allowance which amount shall be determined in the sole
discretion of the board of directors.
c.
Bonus: The Company has an executive incentive program. You
will be eligible to participate in this incentive program beginning
in 2007 once approved by the Company’s Board of Directors.
Your target bonus will be up to 40% base salary based on individual
and company performance.
d.
Common Stock . You acknowledge that, prior to the execution
of this Agreement, you had no right to any option shares of the
Company’s Common Stock that had not vested by the time of
your employment termination, in the event that you are terminated,
and that such unvested shares would be forfeited on the date your
employment is terminated. As consideration for the execution of
this Agreement, all option shares that have been granted to you
which have not vested as of your employment termination shall
automatically vest on your termination date, as described in the
applicable stock option agreement, provided your employment is
terminated by the Company without Cause. You shall not be entitled
to this benefit should you terminate your employment with the
Company, regardless of the reason, or if the Company terminates
your employment with Cause. For purposes of this Agreement, "
Cause " shall mean: (1) your failure or refusal to follow
the Company’s reasonable and lawful directions or your
material failure or refusal to perform your essential duties (other
than by reason of physical or mental illness, injury, or
condition); (2) your material failure or refusal to comply with
Company policies; (3) your engaging in conduct that is or may be
unlawful or disreputable, to the possible detriment of the
Company’s or your own reputation in the industry; or (4) your
breach of this Agreement.
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e.
Taxes . The Company shall withhold taxes from payments it
makes pursuant to this Agreement as required by applicable
law.
f.
Non-qualified Stock Option Grant . Subject to the approval
of the Company’s Board of Directors, you will be granted an
option to purchase 275,000 shares of the Company’s Common
Stock on a post-split basis. The exercise price per share will be
equal to the closing price of the Company’s common stock on
the OTC Bulletin Board on the date of grant. The option will be
subject to the terms and conditions applicable to options granted
under the Company’s Stock Plan, as described in that Plan and
the applicable stock option agreement. The option will be
immediately exercisable, but the purchased shares will be subject
to repurchase by the Company at the exercise price in the event
that your service terminates before you vest in the shares. You
will vest in 25% of the option shares after 12 months of service,
and the balance will vest in three equal yearly installments over
the following three years of service, as described in the
applicable stock option agreement.
g.
Indemnification . The Company will indemnify you for your
actions in good-faith on behalf of the Company pursuant to the
Company’s standard form indemnification agreement.
h.
You acknowledge the receipt and sufficiency of this
consideration
4. Existing Agreement . The
Company and you agree that this Agreement shall supersede in its
entirety any prior agreements you may have executed with the
Company, so that such terms and conditions shall have no further
force or effect as of the effective date of this Agreement.
5. Conflict of Interest . You
acknowledge you have not entered into, and you agree you will not
enter into, any agreement, either written or oral, in conflict with
this Agreement or your employment with Company. You also
acknowledge you will not violate any agreement with or rights of
any third party or, except as expressly authorized by Company in
writing hereafter, use or disclose your own or any third
party’s confidential information or intellectual property
when acting within the scope of your employment or otherwise on
behalf of Company. Further, you have not retained anything
containing any confidential information of a prior employer or
other third party, whether or not created by you.
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6. Company
Ownership . Company shall own all right, title and interest
(including patent rights, copyrights, Trade Secret rights, sui
generis database rights and all other intellectual and
industrial property rights of any sort throughout the world)
relating to any and all inventions (whether or not patentable),
works of authorship, mask works, designs, know-how, ideas and
information made or conceived or reduced to practice, in whole or
in part, by you during the term of your employment with Company to
and only to the fullest extent allowed by law (collectively
"inventions"), and you will promptly disclose all inventions to
Company. You hereby made all assignments necessary to accomplish
the foregoing. You shall further fully and promptly assist Company,
at Company’s expense, to further evidence, record and perfect
such assignments, and to perfect, obtain, maintain, enforce, and
defend any rights specified to be so owned or assigned. You hereby
irrevocably designate and appoint Company as your agent and
attorney-in-fact, coupled with an interest and with full power of
substitution, to act for and in your behalf to execute and file any
document and to do all other lawfully permitted acts to further the
purposes of the foregoing with the same legal force and effect as
if executed by you. Without limiting Section 5 or
Company’s other rights and remedies, if, when acting within
the scope of your employment, or otherwise on behalf of Company,
you use or (except pursuant to this Section 6 ) disclose
your own or any third party’s confidential information or
intellectual property (or if any invention cannot be fully made,
used, reproduced, distributed and otherwise exploited without using
or violating the foregoing), Company will have and you hereby grant
Company a perpetual, irrevocable, worldwide royalty-free,
non-exclusive, sub-licensable right and license to exploit and
exercise all such confidential information and intellectual
property rights.
7. To the extent allowed by law,
Section 6 includes all rights of integrity, disclosure and
withdrawal and any other rights that may be known as or referred to
as "moral rights," "artist’s rights," "droit moral," or the
like (collectively "Moral Rights"). To the extent you retain any
such Moral Rights under applicable law, you hereby ratify and
consent to any action that may be taken with respect to such Moral
Rights by or authorized by Company and agree not to assert any
Moral Rights with respect thereto. You will confirm any such
ratifications, consents and agreements from time to time as
requested by Company.
8. Proprietary Information . You
agree that all inventions and all other business, technical and
financial information (including, without limitation, the identity
of and information relating to customers or employees) you develop,
learn or obtain during the term of your employment that relate to
Company or the business or demonstrably anticipated business of
Company or that are received by or for Company in confidence,
constitute "Proprietary Information." Proprietary Information shall
be promptly and fully disclosed by you to the Company and shall be
the exclusive property of the Company as against you and your
successors, heirs, devisees, legatees and assigns. You hereby
assign to the Company your entire right, title, and interest
therein and shall promptly deliver to the Company all papers,
drawings, models, data, and other material relating to any of the
foregoing Proprietary Information conceived, made, developed,
created or reduced to practice by you as aforesaid. Upon
termination of your employment, you will promptly return to Company
all items containing or embodying Proprietary Information
(including all copies), except that you may keep your personal
copies of: (i) your compensation records; (ii) materials
distributed to shareholders generally; and (iii) this Agreement.
You also recognize and agree to Company’s telecommunications,
networking or information processing systems (including, without
limitation, stored computer files, e-mail messages and voice
messages) and that your activity and any files or messages on or
using any of those systems may be monitored at any time without
notice.
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9. Restrictive
Covenants .
a.
Definitions :
(1)
"Company’s Business" means the highly competitive business of
developing, manufacturing, marketing, distributing, and/or selling
pharmaceutical products and acquiring pharmaceutical products for
the development of new reformulations, applications, and/or
enhanced clinical benefits.
(2)
"Competitive Business(es)" include any firm, partnership, joint
venture, corporation and/or any other entity and/or person, and/or
any licensee of such entity, that engages in the Company’s
Business.
(3)
"Confidential Information" means information about the Company and
its Customers, Customer Prospects, and/or Vendors that is not
generally known outside of the Company, which you will learn of in
connection with your employment with the Company. Confidential
Information may include, without limitation: (1) the
Company’s business policies, finances, and business plans;
(2) the Company’s financial projections, including but not
limited to, annual sales forecasts and targets and any
computation(s) of the market share of Customers and/or Customer
Prospects; (3) sales information relating to the Company’s
product roll-outs; (4) customized software, marketing tools, and/or
supplies that you will be provided access to by the Company and/or
will create; (5) the identity of the Company’s Customers,
Customer Prospects, and/or Vendors (including names, addresses, and
telephone numbers of Customers, Customer Prospects, and/or
Vendors); (6) any list(s) of the Company’s Customers,
Customer Prospects, and/or Vendors; (7) the account terms and
pricing upon which the Company obtains products and services from
its Vendors; (8) the account terms and pricing of sales contracts
between the Company and its Customers; (9) the proposed account
terms and pricing of sales contracts between the Company and its
Customer Prospects; (10) the names and addresses of the
Company’s employees and other business contacts of the
Company; (11) the techniques, methods, and strategies by which the
Company develops, manufactures, markets, distributes, and/or sells
any of the products described in Section 9.a.(1) and (12)
Proprietary Information described in Section 8 above.
(4)
"Customers" means any firm, partnership, corporation and/or any
other entity and/or person that purchased or purchases from the
Company any of the products generally described in Section
9.a.(1)
(5)
"Customer Prospects" means any firm, partnership, corporation
and/or any other entity and/or person reasonably expected by the
Company to be likely to purchase from the Company any of the
products described in Section 9.a.(1)
(6)
"Material Contact" means personal contact, including, but not
limited to, contact made in person, by phone, or through
correspondence via mail, facsimile, or electronic mail, or the
supervision of the efforts of those who have direct personal
contact with Customers, Customer Prospects, or Vendors in an effort
to initiate or further a business relationship between the Company
and such Customers, Customer Prospects, or Vendors.
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(7)
Your "Job Duties" are those duties you have performed during the
twelve (12) months preceding the execution date of this Agreement,
or since you commenced your employment with the Company if less
than twelve (12) months, as well as those duties as may from
time-to-time reasonably be prescribed by the Company during the
period of your employment with the Company.
(8)
"Territory" means the United States.
(9)
"Trade Secrets" means Confidential Information which meets the
additional requirements of the Delaware Uniform Trade Secrets Act
("DUTSA"), 6 DEL. CODE ANN. §§ 2001-2011, and/or under
any other applicable law.
(10)
"Vendors" means any individual and/or entity that provides goods
and services to the Company.
b.
You agree that your work for the Company will bring you into close
contact with many of the Company’s Customers, Customer
Prospects, Vendors, Trade Secrets, and Confidential information.
You further agree that the covenants in this Section 9 are
reasonable and necessary to protect the Company’s legitimate
business interests and its Customer, Customer Prospect, and/or
Vendor relationships, Trade Secrets, and Confidential
Information.
c.
You further agree that, due to your position, your engaging in any
activity that may breach this Agreement is likely to cause the
Company great, immediate and irreparable harm.
d.
Duty of Confidentiality . You agree that, during your
employment with the Company and for a period of two (2) years
following the termination of such employment for any reason, you
shall not directly or indirectly divulge or make use of any
Confidential Information outside of your employment with the
Company (so long as the information remains confidential) without
the prior written consent of the Company. You shall not directly or
indirectly misappropriate, divulge, or make use of Trade Secrets
for so long as the information remains a Trade Secret as defined by
the DUTSA and/or any other applicable law. You further agree that,
if you are questioned about information subject to this agreement
by anyone not authorized to receive such information, you will
notify the Company within 24 hours. You acknowledge that applicable
law may impose longer duties of non-disclosure, especially for
Trade Secrets, and that such longer periods are not shortened by
this Agreement.
e.
Return of Confidential Information And Company Property .
You agree to return all Confidential Information and/or Trade
Secrets within three (3) calendar days following the termination of
your employment for any reason. To the extent you maintain
Confidential Information and/or Trade Secrets in electronic form on
any computers or other electronic devices owned by you, you agree
to irretrievably delete all such information and to confirm under
penalty of perjury the fact of deletion in writing within three (3)
calendar days following termination of employment with the Company
for any reason. You also agree to return all Company property in
your possession at the time of the termination of the employment
with the Company, including but not limited to all documents,
records, tapes, and other media of every kind and description
relating to the Company’s Business and its Customers,
Customer Prospects, and/or Vendors, and any copies, in whole or in
part, whether or not prepared by you, all of which shall remain the
sole and exclusive property of the Company.
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f.
Non-Competition . You covenant and agree that, during the
term of your employment with the Company and for twelve (12) months
after the termination thereof, regardless of the reason for the
employment termination, you will not, directly or indirectly,
anywhere in the Territory, on behalf of any Competitive Business
perform the same or substantially the same Job Duties.
g.
Non-Solicitation of Customers, Customer Prospects, and
Vendors . You covenant and agree that, during the term of your
employment with the Company and for twelve (12) months after the
termination thereof, regardless of the reason for the employment
termination, you will not, directly or indirectly, solicit or
attempt to solicit any business from any of the Company’s
Customers, Customer Prospects, or Vendors with whom you had
Material Contact during the last two (2) years of your employment
with the Company.
e.
Non-Solicitation of Employees . You covenant and agree that,
during the term of your employment with the Company and for twelve
(12) months after the termination thereof, regardless of the reason
for the employment termination, you will not, directly or
indirectly, on your own behalf or on behalf of or in conjunction
with any person or legal entity, recruit, solicit, or induce, or
attempt to recruit, solicit, or induce, any non-clerical employee
of the Company with whom you had personal contact or supervised
while performing your Job Duties, to terminate their employment
relationship with the Company.
10. At-Will Status . You
acknowledge and agree that nothing in this Agreement is a guarantee
or assurance of employment for any specific period of time. Rather,
you understand that you are an at-will employee and that the
Company may terminate your employment at any time for any reason.
You are similarly free to resign at any time for any reason.
11. Severance Benefits . If the
Company terminates your employment without Cause, you shall also
receive Severance Benefits for no less than 6 months (in an
amount equal to your then base salary over such time period less
applicable withholdings) in exchange for your execution and
delivery to the Company of the General Release attached as Exhibit
A hereto. You shall not be entitled to Severance Benefits if the
Company terminates your employment with Cause or if you resign from
the Company for any reason.
12. Termination of Benefits . You
acknowledge that the restrictive covenants contained in Section
9 are integral to this Agreement and that, if you engage in any
activities prohibited by Section 9 , the vesting of any
option shares of the Company’s Common Stock shall be voided
at the time of your breach of this Agreement, even if the
Arbitrator(s) does not enforce the restrictive covenants above due
to overbreadth. Further, if you engage in any activities prohibited
by Section 9 and are receiving Severance Benefits, the Company
shall be entitled to cease such payments at the time of your breach
of this Agreement.
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13 Governing Law and
Remedies . In addition to any ot
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