EXHIBIT 10.1

     
(MEMORY LOGO) [y00178y0017800.gif]
   
Memory Pharmaceuticals Corp.
  Tony Scullion
100 Philips Parkway
  Chief Executive Officer
Montvale, New Jersey 07645
   
Phone: (201) 802-7102
   
Fax: (201) 802-7190
   
www.memorypharma.com
   

May 18, 2004

Jzaneen Lalani, Esq.

Dear Ms. Lalani:

     We are pleased to extend an offer to you to join our Company as Vice
President Legal Affairs. We look forward to you joining our team, and are
confident that you will contribute significantly to the value of our
organization. The terms of your anticipated employment by the Company are as
follows.

     1. Position. Your position will be Vice President of Legal Affairs, based
out of the Company’s offices currently located in Montvale, New Jersey, and you
will report directly to the Company’s Chief Executive Officer unless otherwise
directed by the CEO. As Vice President of Legal Affairs, you will be part of the
Company’s senior management team. Your responsibilities shall include, but not
be limited to, managing the Company’s corporate and SEC compliance and assisting
management in evaluating and addressing legal and other issues raised in the
Company’s operations and activities. In addition to performing duties and
responsibilities associated with the position of Vice President of Legal
Affairs, from time to time the Company may assign you other duties and
responsibilities and/or may assign you to a different location.

     As a full-time employee of the Company, you will be expected to devote your
full business time and energies to the business and affairs of the Company. Your
performance will be reviewed formally after six months of employment and
annually thereafter at the end of each calendar year.

     2. Starting Date/Nature of Relationship. It is expected that your
employment will start on June 10, 2004 (the “Start Date”). No provision of this
letter shall be construed to create an express or implied employment contract
for a specific period of time. Either you or the Company may terminate the
employment relationship at any time and for any reason, by giving at least
thirty (30) days’ prior written notice to the other party.

     3. Compensation.

     (a) Your initial salary will be at the bi-weekly rate of $7,307.69
(annualized at $190,000).

     (b) Effective as of the Start Date, you will receive stock options to
purchase 50,000 shares of the Company’s Common Stock, which will be in the form
on incentive stock options, to the extent permissible under applicable law, and
the balance will be in the form of non-qualified stock options. Such stock
options (i) will entitle you to purchase the Company’s Common Stock at the then
current fair market value per share, as determined by the Company’s Board of
Directors in accordance with the Company’s 2004 Stock Incentive Plan, and
(ii) shall vest in quarterly increments over a period of four (4) years as
described in the standard forms of Stock Option Agreement, which you agree to
execute and deliver to the Company on or before the Start Date.

 

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MEMORY PHARMACEUTICALS CORP.

     (c) You will be eligible to receive annual bonus payments dependent on the
performance of the Company and your individual performance, subject to the
discretion of the Board of Directors. Your target bonus will be equal to
twenty-five percent (25%) of your base salary, assuming the achievement of such
Company and individual performance objectives.

     (d) Upon termination for any reason, the Company will pay you within two
weeks of such termination, your current base salary earned through the
termination date, plus accrued vacation, if any, and other benefits or payments,
if any, to which you are entitled. In the event that you are terminated by the
Company without “Cause” (as hereinafter defined), then the Company will continue
to pay you your bi-weekly rate in effect at the time of termination and provide
and pay the Company’s portion of your medical insurance for a period of six (6)
months. Further, for the period commencing seven months following such
termination and ending twelve months after such termination, the Company will
continue to pay you your bi-weekly rate in effect at the time of termination and
provide and pay the Company’s portion of your medical insurance, except that
such severance payments made to you during this period will be reduced by all
1099 and W-2 income earned or received by you during such period, including
income earned or received from consulting services or temporary employment, and
the Company’s payments for your medical insurance will terminate when you have
such coverage through any new employer before the end of the twelve month period
following your termination. The Company will reconcile such payments with you
quarterly, and any additional payments owed to you by the Company, and any
payments owed to the Company by you, will be paid respectively within two weeks
following such reconciliation period. The Company will not be obligated to
continue any such payments to you under this paragraph 3(d) in the event you
materially breach the terms of the Confidentiality Agreement (as defined below).
Notwithstanding any termination of your employment (with or without Cause), you
shall continue to be bound by the provisions of the Confidentiality Agreement.

     (e) For the purposes of this Section 3, “Cause” shall include (i) your
conviction of a felony, either in connection with the performance of your
obligations to the Company or otherwise, which adversely affects your ability to
perform such obligations or materially adversely affects the business
activities, reputation, goodwill or image of the Company, (ii) your willful
disloyalty, deliberate dishonesty, breach of fiduciary duty, (iii) your breach
of the terms of this Agreement, or your failure or refusal to carry out any
material tasks assigned to you by the Company in accordance with the terms
hereof, which breach or failure continues for a period of more than thirty
(30) days after your receipt of written notice thereof from the Company,
(iv) the commission by you of any act of fraud, embezzlement or deliberate
disregard of a rule or policy of the Company known to you or contained in a
policy and procedure manual provided to you which results in material loss,
damage or injury to the Company, or (v) the material breach by you of any of the
provisions of the Confidentiality Agreement.

     4. Benefits. You will be entitled as an employee of the Company to receive
such benefits as are generally provided its employees and executives and for
which you are eligible in accordance with Company policy as in effect from time
to time. The Company retains the right to change, add or cease any particular
benefit relating to its employees and executives generally. At this time, the
Company is offering a benefit program, consisting of medical, dental, life and
short/long term disability insurance, as well as a 401(k) retirement plan and
flexible spending plan. You will be eligible for eleven paid holidays, four
floating holidays and four (4) weeks paid vacation per year, which will be pro
rated for the 2000 calendar year based on the Start Date. You will accrue
additional vacation days in accordance with Company policy. If you decide to
become a “resident alien” for U.S. immigration purposes, the Company will
arrange for its immigration counsel to handle the matter on your behalf and will
pay the related legal fees and expenses.

     5. Confidentiality. The Company considers the protection of its
confidential information and proprietary materials to be very important.
Therefore, as a condition of your employment, you and the Company will become
parties to a Confidentiality and Noncompetition Agreement substantially in the
form of Exhibit A to this letter (the “Confidentiality Agreement”).

     6. General.

     (a) This letter, together with the Employment Agreement, the
Confidentiality Agreement and the Stock Option Agreement, when executed, will
constitute our entire agreement as to your employment by the Company and will
supersede any prior agreements or understandings, whether in writing or oral.

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MEMORY PHARMACEUTICALS CORP.

     (b) This letter shall be subject to and contingent upon the following:

          (i) satisfactory results of a medical examination;

          (ii) maintenance by you of non-immigrant or resident alien status for
immigration purposes while in the United States allowing you to work for the
Company;

          (iii) verification of employment history; and

          (iv) your agreement (as evidenced by your signature below) to use
reasonable efforts after the Start Date to become familiar with New Jersey law
as generally applicable to the Company. Your employment with the Company shall
not require you to become licensed and admitted as a member of the New Jersey
Bar.

     (c) This letter and the Company’s obligations hereunder shall be subject to
review and approval by the Company’s Board of Directors and the Compensation
Committee thereof.

     (d) This letter shall be governed by the law of the State of New Jersey.

     You may accept this offer of employment and the terms thereof by signing
the enclosed additional copy of this letter and the Confidentiality Agreement,
which execution will evidence your agreement with the terms set forth herein and
therein, and returning them to the Company.

     This offer of employment will expire on May 21, 2004, unless accepted by
you prior to such date. We look forward to you joining our team, and we believe
that your skills will compliment those of our existing management team, and that
you will make a significant contribution to the Company’s growth. We look
forward to your prompt response to this offer letter.

      MEMORY PHARMACEUTICALS CORP.
 
   
By:
  /s/ Tony Scullion

 

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  Name: Tony Scullion

  Title: Chief Executive Officer
 
    ACCEPTED AND AGREED
 
    /s/ Jzaneen Lalani

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  Jzaneen Lalani, Esq.
 
    Date: 05/18/04

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