Exhibit 10.1
EMPLOYMENT AGREEMENT
     This Employment Agreement (this “Agreement”), is made and entered into this
14th day of February, 2006 (the “Effective Date”), by and between Cyberkinetics
Neurotechnology Systems, Inc., a Delaware corporation (the “Company”), and Mark
A. Carney (the “Executive”).
          Whereas, the parties wish to set forth their understanding and
agreement regarding the employment of the Executive by the Company;
          Now therefore, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
Section 1. Employment Services.
     During the Employment Period (as defined below), the Executive will serve
as the Company’s Executive Vice President and will have such duties and
responsibilities as would normally attach to those positions, including such
duties and responsibilities as are customary among persons employed in similar
capacities for similar companies, subject to the authority of the CEO and
President of the Company. The Executive will faithfully and diligently carry out
his duties and responsibilities and comply with all of the reasonable and lawful
directives of the CEO, to which the Executive will report. The Executive will,
if so elected, serve as a director of the Company and, if requested by the
Company, an officer or director of any subsidiary or affiliate of the Company
without compensation in addition to that provided in this Agreement. For
purposes of this Agreement, an “affiliate” of the Company means any corporation,
limited partnership, limited liability company or other entity engaged in the
same business as the Company, or a related business, and which is controlled by
or is under common control with the Company.
Section 2. Term.
     The Company shall employ the Executive, and the Executive accepts such
employment, commencing on the Effective Date and continuing thereafter until
such time as this Agreement has terminated under the provisions of Section 5
hereof (the “Employment Period”).
Section 3. Performance.
     During the Employment Period, the Executive shall devote his best efforts
and all of his business time and attention (except for vacation periods and
reasonable periods of illness or other incapacity) to the business of the
Company and its affiliates and will not engage in consulting work or in any
other trade or business for his own account or for or on behalf of any other
person, firm or corporation without the written consent of the Board of
Directors of the Company (the “Board”) in each case, which shall not be granted
if any such activity, in the opinion of the Board, competes, conflicts or
interferes with the performance of his duties hereunder in any material way;
provided, however, the Company acknowledges and agrees that the Executive may
devote no more than

 

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one and one-half days per calendar quarter in the aggregate to the entities
listed on Exhibit A attached hereto and incorporated herein which activity shall
not be a breach of this Section 3.
Section 4. Compensation and Benefits.

  (a)   Salary. For services to the Company rendered by the Executive in any
capacity during the Employment Period, including, without limitation, services
as a manager, officer, director or member of any committee of the Company or of
any subsidiary, affiliate or division thereof, the Company will pay or cause to
be paid to the Executive a base salary at the rate of not less than $212,000 per
annum (or such higher amount as the Compensation Committee of the Board (the
“Compensation Committee”), if any, may establish from time to time). The
Executive’s base salary for any partial year will be prorated based upon the
number of days elapsed in such year. The Executive’s base salary will be payable
periodically in accordance with the Company’s customary payroll practices for
its executives. Such base salary shall be reviewed at least annually after the
end of each fiscal year, starting with the fiscal year ending December 31, 2006,
and may be increased based on the Executive’s performance, but not decreased, by
the Board (or the Compensation Committee) in its reasonable discretion, to be
effective in the first pay period of the ensuing January, starting with
January 2007. The term “base salary” shall not include any payment or other
benefit which is denominated as or is in the nature of a bonus, incentive
payment, profit-sharing payment, performance share award, stock option, stock
appreciation right, retirement or pension accrual, insurance benefit, other
fringe benefit or expense allowance, whether or not taxable to the Executive as
income.     (b)   Annual Performance Bonus. The Executive will be eligible to
receive an annual cash performance bonus of up to $100,000 (the “Annual
Performance Bonus”). The Compensation Committee shall consider and make a bonus
determination not later than 90 days after the end of each fiscal year during
the Employment Period, starting with the fiscal year ending December 31, 2006.
Bonus awards shall be based upon the performance by the Executive as measured
against objective and reasonable criteria mutually agreed and approved in
advance by the Executive and the Compensation Committee, which criteria shall be
set forth in Schedule 1 to this Agreement. To the extent that at least 50% of
the criteria are achieved, the Executive shall be paid a pro rata percentage of
the Annual Performance Bonus. In the event Executive exceeds such criteria set
forth in Schedule 1 to this Agreement, the Compensation Committee may in its
sole and absolute discretion increase the Annual Performance Bonus to an amount
greater than $100,000.

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  (c)   Candidacy for COO Position. Until the third anniversary of the Effective
Date of this Agreement, the Company agrees that the Executive will be considered
as a candidate for the position of Chief Operating Officer of the Company,
should such position be created. If the Executive is offered such a position and
the Executive declines the offer due to the requirements of the geographic
location of the position, such event will not be considered a “Deemed
Termination Event” (as defined below) unless he is thereafter terminated by the
Company solely for declining such offer.     (d)   Stock Option Grant.
Simultaneously with the execution and delivery of this Agreement, the Company
hereby grants to the Executive an incentive stock option to purchase up to
100,000 shares of the Company’s Common Stock (the “Option”) pursuant to the
terms and conditions of that certain Option Agreement, a copy of which is
attached hereto and incorporated herein as Exhibit B (the “Option Agreement”).
Under the terms of the Option Agreement, the Option will have an exercise price
equal to the fair value of the Company’s Common Stock as of the Effective Date
and the shares of the Company’s Common Stock granted under the Option will
become vested and exercisable over a period of four years as follows: (i) 25% on
the first anniversary of the Effective Date and (ii) an additional 6.25% shall
vest every three months after the first anniversary of the Effective Date for
the next three years, as long as the Executive continues to be engaged by the
Company on each successive vesting date under the terms and conditions of this
Agreement (or another agreement mutually agreed upon). The Option will have a
term of ten (10) years from the Effective Date.     (e)   Accelerated Vesting of
Stock Options. Upon any sale, merger or other transaction resulting in a change
in control of the Company in which the per share consideration to be received by
the stockholders of the Company is equivalent to at least $6 per share, any
unvested options to purchase shares of the Company’s Common Stock granted to
Executive pursuant to Section 4(d) above which remain outstanding immediately
prior to the effective date of the change in control shall vest and become
exercisable immediately prior to such sale, merger or other change of control
transaction. For purposes of this Section 4(e), a change of control shall be
deemed to occur upon: (1) any sale or exchange of greater than 50% of the voting
interest of the Company; (2) any merger of the Company with an unaffiliated
third party in which the Company does not survive the merger; or (3) any sale of
all or substantially all assets of the Company.     (f)   Other Benefits. In
addition to the compensation described in this Section 4, and such other amounts
not constituting base salary as may be provided to the Executive from time to
time by the Board, the Executive will be entitled during the Employment Period
to participate in any retirement plans, bonus plans, welfare benefit plans and
other employee

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      benefit plans of the Company that may be in effect from time to time with
respect to executives of the Company generally, to the extent the Executive is
eligible under the terms of those plans. Executive shall also be entitled to the
following:

  •   Twenty days of paid vacation per year.     •   The Company shall also
reimburse the Executive in accordance with the Company’s reimbursement policy
for all reasonable and necessary business expenses incurred by him in the course
of performing his duties hereunder, provided that such expenses are
appropriately documented in accordance with the Company’s reimbursement policy.
    •   Executive shall be entitled to a life insurance policy in a face amount
equal to Three Hundred Thousand Dollars ($300,000) (the Life Insurance”), which
such policy shall be convertible to an individual policy at the election of
Executive upon termination of Executive’s employment with the Company.

Section 5. Termination.
     The Executive’s employment hereunder shall terminate under the following
circumstances:

  (a)   Death or Disability. The Executive’s employment with the Company shall
automatically terminate upon the death or Disability (as hereinafter defined) of
the Executive. “Disability” shall mean that the Executive is no longer able to
perform the essential functions of the Executive Vice President for a continuous
period of six (6) months or a total of nine (9) months in any one-year period.
If any question arises as to whether the Executive has been so disabled, the
Executive shall submit to an examination by a physician mutually acceptable to
the Board and the Executive and following such examination, the physician shall
submit to the Company and to the Executive a report in reasonable detail setting
forth his or her opinion as to whether the Executive was so disabled. Such
report shall for the purposes of this Agreement be conclusive of the issue.
Notwithstanding the foregoing, in the event of a Disability, the Company shall
take no action that violates the applicable provisions of the Americans With
Disabilities Act. If the Executive’s employment with the Company is terminated
due to the death or Disability of the Executive, then Company shall promptly pay
(and in any event no later than five (5) days after the date of death or
Disability) to the Executive’s estate or to the Executive any and all amounts
then owed to the Executive, including all accrued and unpaid base salary,
vacation pay, other benefits, and any applicable earned portion of the Annual
Performance Bonus less any applicable withholdings. In addition, the Executive
shall also be entitled to

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      reimbursement of any reimbursable business expenses which were incurred by
Executive through and including the date of death or Disability, which shall be
paid in accordance with the Company’s expense reimbursement policy. With respect
to a termination due to Disability, the Executive shall be entitled to convert
the Life Insurance into an individual policy.     (b)   Termination by the
Company without Cause. The Company may, at any time by action of a majority of
the entire membership of its Board not including Executive, terminate the
Executive’s employment without Cause (as defined below) by giving the Executive
written notice of the effective date of termination (which effective date may be
the date of such written notice) (the “Date of Termination”). If the Executive
voluntarily resigns his employment with the Company during the three-year period
following the Effective Date of this Agreement due to a material reduction in
the Executive’s responsibilities or title, or due to a material reduction in the
Executive’s base salary without a corresponding pro rata reduction in the base
salary of the Company’s other executives, or due to the Company requiring the
Executive to relocate more than 50 miles from Indianapolis, Indiana, or due to a
breach of this Agreement by the Company (each a “Deemed Termination Event”),
such voluntary resignation will be deemed to be termination by the Company
without Cause. The Executive will provide thirty (30) days prior written notice
to the Company of any such voluntary resignation by reason of a Deemed
Termination Event, and during such 30-day period the Company shall have an
opportunity to cure the Deemed Termination Event (the actual date of termination
of the Executive’s employment as a result of a resignation due to a Deemed
Termination Event is also referred to herein as the “Date of Termination”). If a
cure is effected within such 30-day period, the provisions of this Section 5(b)
shall no longer be applicable with respect to the Deemed Termination Event so
cured. If the Executive resigns his employment due to a Deemed Termination Event
or the Executive is terminated without Cause by the Company, any unvested
options granted hereunder that, absent such termination, that would have
otherwise vested in the 12 month period following the date of termination shall
immediately vest and be exercisable. If the Company shall terminate the
Executive without Cause hereunder or the Executive resigns his employment due to
the occurrence of a Deemed Termination Event, the Company shall have the
obligation to pay the Executive the following:

  (1)   Any and all amounts owed to the Executive through the Date of
Termination, including all accrued salary, vacation pay, and any other benefits,
which shall be payable in a lump sum payment less any applicable withholdings
within five (5) business days (for purposes of this Agreement, a “business day”
shall mean any day other than Saturday, Sunday or any day on which banks in the

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      Commonwealth of Massachusetts are authorized by law to close) following
the Date of Termination.     (2)   Each month for a period of twelve (12) months
following the Date of Termination (the “Severance Period”), the Company shall
pay the Executive, as a severance payment, 100% of the Executive’s Monthly
Salary (as defined below), less required withholdings. Such amounts shall be
payable periodically in accordance with the Company’s customary payroll
practices. Within six months following the end of the Severance Period, the
Executive shall reimburse the Company for any severance amounts paid to the
Executive to the extent the Executive has earned or received income from other
sources (excluding directors’ fees and investment income) during the Severance
Period and reportable as earnings on Form W-2 or Form 1099 (the “Supplementary
Income”). Notwithstanding the foregoing, the Executive shall not be obligated to
reimburse the Company for any amounts in excess of the aggregate amount paid by
the Company to the Executive during the Severance Period and the Executive shall
have no affirmative duty to seek alternative employment or otherwise mitigate
the costs and expenses the Company is required to pay or incur during the
Severance Period. For purposes hereof, “Monthly Salary” shall mean the
Executive’s annual base salary in effect immediately prior to the Date of
Termination (except if the termination is due to a reduction in salary, then the
annual base salary in effect immediately prior to the decrease in annual base
salary) divided by twelve (12).     (3)   A bonus, equal to the average of the
Annual Performance Bonuses earned by the Executive in each of the two (2) years
prior to his termination of employment (or if the Executive has not been
employed for two full years, an assumed bonus of $50,000 for each year which the
Executive was not employed during the full year), which shall be payable in a
lump sum payment within five (5) business days after the Date of Termination.  
  (4)   The Executive may continue to participate in the Company’s group health,
life and dental plans during the Severance Period at the same cost to him as in
effect prior to his termination of employment.     (5)   Notwithstanding
anything to the contrary herein, in the event that the Executive materially
breaches Sections 6, 7, 8 or 9 of this Agreement, which breach, if reasonably
capable of being cured, is not cured within thirty (30) days after receipt of
written notice from the Company, the Company’s obligations under subsections
(2) through (5) above shall cease in their entirety.

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  (6)   The Executive shall be entitled to reimbursement of any reimbursable
business expenses which were incurred prior to the Termination Date which shall
be paid by the Company in accordance with the Company’s expense reimbursement
policy.     (7)   The Executive shall be entitled to convert the Life Insurance
into an individual policy if the policy provides for such conversion.

  (c)   Termination by the Company for Cause. The Company shall have the right
to terminate the Executive’s employment effective immediately for any of the
following reasons (each of which is referred to herein as “Cause”) by giving the
Executive written notice which specifically identifies the Cause in reasonable
detail:

  (1)   the breach of any provision of this Agreement, which breach, if
reasonably capable of being cured, is not cured within thirty (30) days after
receipt of written notice from the Company;     (2)   any act of willful
disloyalty, dishonesty, or breach of fiduciary duty with respect to any aspect
of the Company’s or any affiliate’s business;     (3)   any act of fraud or
embezzlement;     (4)   deliberate disregard of a rule or policy of the Company
known by the Executive or contained in a policy and procedure manual provided to
the Executive which results in material loss, damage or injury to the Company
and is not cured with thirty (30) days after receipt of written notice from the
Company; or     (5)   conviction of a felony.

If the Executive’s employment is terminated by the Company pursuant to this
Section 5(c), then (i) the Company shall have no further obligations hereunder
accruing from and after the effective date of termination and shall have all
other rights and remedies available under this or any other agreement and at law
or in equity; and (ii) any unvested options granted hereunder shall immediately
expire. Notwithstanding the foregoing, the Company shall promptly pay (and in
any event within five (5) business days after the date of termination) to the
Executive on the effective termination date any and all amounts then owed to the
Executive, including all accrued salary, vacation pay, other benefits and any
applicable earned portion of the Annual Performance Bonus less any applicable
withholdings. In addition, the Executive shall also be entitled to reimbursement
of any reimbursable business expenses which were incurred by Executive through
and including the date of termination, which shall be paid by the Company in
accordance with the Company’s expense reimbursement policy. The Executive shall
be entitled to convert the Life Insurance into an individual policy.

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  (d)   Resignation by the Executive. The Executive may resign his employment
with the Company under this Agreement at any time upon thirty (30) days prior
written notice to the Company. The Board may, in such event, elect to waive the
period of notice, or any portion thereof, in which event the Executive’s date of
resignation shall be that date within such thirty (30) day notice period
determined by the Board. Upon resignation by the Executive of his employment
with the Company for any reason other than the occurrence of a Deemed
Termination Event under Subsection 5(b) hereof (in which case the provisions of
Section 5(b) hereof shall be applicable): (i) the Company shall have no further
obligations hereunder accruing from and after the effective date of termination;
and (ii) any unvested options granted to the Executive shall immediately expire.
Notwithstanding the foregoing, the Company shall pay to the Executive within
five (5) business days after the effective termination date any and all amounts
then owed to the Executive, including all accrued salary, vacation pay, other
benefits and any earned portion of the Annual Performance Bonus less any
applicable withholdings. In addition, the Executive shall also be entitled to
reimbursement of any reimbursable business expenses which were incurred by
Executive through and including the effective date of the termination, which
shall be paid by the Company in accordance with the Company’s expense
reimbursement policy after the submission of a written expense report by the
Executive. The Executive shall be entitled to convert the Life Insurance into an
individual policy.

Section 6. Confidential Information

  (a)   While employed by the Company and thereafter, the Executive shall not,
directly or indirectly, disclose to anyone outside of the Company any
Confidential Information (as hereinafter defined) or use any Confidential
Information other than pursuant to Executive’s employment by, and for the
benefit of, the Company.     (b)   The term “Confidential Information,” as used
throughout this Agreement, means all data or information not generally known
outside of the Company whether prepared or developed by or for the Company or
received by the Company from an outside source. Without limiting the scope of
this definition, Confidential Information includes any trade secrets, any
technical data, design, pattern, formula, computer program, source code, object
code, algorithm, manual, product specification, systems, methods, processes or
plan for a new or revised product; and any business, marketing, financial, or
sales record, data, plan, or survey; and any other record or information
relating to the present or future business or products of the Company. All
Confidential Information and copies thereof are the sole property of the
Company.

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Section 7. Noncompetition and Nonsolicitation
     (a) During the term of the Executive’s employment by the Company under this
Agreement and for a period equal to the greater of (i) twelve (12) months
following termination of the Executive’s employment, however caused, and
(ii) the noncompetition period set forth in an Investment Representation Letter
submitted to the Company by the Executive on or about the date hereof, the
Executive shall not, without the prior written consent of the Company:

  (1)   For himself or on behalf of any other person or entity, directly or
indirectly, either as principal, agent, stockholder, employee, consultant,
representative or in any other capacity, own, manage, operate or control, or be
connected or employed by, or otherwise associate in any manner with, engage in
or have a financial interest in any business which is directly or indirectly
competitive with the Company’s Business (as defined below), or any of its
affiliates, except that nothing contained herein shall preclude the Executive
from purchasing or owning stock in any such business if such stock is publicly
traded and provided that the Executive’s holdings do not exceed three percent
(3%) of the issued and outstanding capital stock of such business.
Notwithstanding anything in this Agreement to the contrary, the Executive shall
not be precluded from employment by a business with multiple business units or
divisions, so as the business unit or division in which he is employed is not
competitive with the Company’s Business.     (2)   Either individually or on
behalf of or through any third party, solicit, divert or appropriate or attempt
to solicit, divert or appropriate, for the purpose of competing with the Company
or any present or future parent, subsidiary or other affiliate of the Company
which is engaged in a similar business as the Company’s Business, any customers
or patrons of the Company, or any prospective customers or patrons with respect
to which the Company has developed or made a sales presentation (or similar
offering of services).     (3)   Either individually or on behalf of or through
any third party, directly or indirectly, solicit, entice or persuade or attempt
to solicit, entice or persuade any other employees of or consultants to the
Company within the immediately preceding 12-month period or any parent or
affiliate of the Company to leave the services of the Company or any parent or
affiliate for any reason.     (4)   For purposes of this Section 7, the
Company’s business (“Business”) shall mean researching, developing or
commercializing therapeutic and diagnostic devices and drugs for the diagnosis
and treatment of central nervous system injury and disease; provided that the
term “Business” shall be deemed

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      amended to reflect any change in the Company’s Business after the
Effective Date but prior to the Executive’s termination or resignation of
employment with the Company. A business will be deemed to be competitive with
the Company if it is engaged in a business substantially similar, in whole or in
part, to the Company’s Business.

Section 8. Ownership of Ideas, Copyrights and Patents.
     (a) The Executive agrees that all ideas, discoveries, creations,
manuscripts and properties, innovations, improvements, know-how, inventions,
designs, developments, apparatus, techniques, methods, processes and formulae
(all of the foregoing being hereinafter referred to as “the inventions”) which
may be used in the business of the Company, or any of its affiliates, whether
patentable, copyrightable or not, which the Executive may conceive or develop
during his employment with the Company, or any of its affiliates, alone or in
conjunction with another or others, whether during or out of regular business
hours, and whether at the request or upon the suggestion of the Company, or any
of its affiliates, or otherwise, shall be the sole and exclusive property of the
Company, or any of its affiliates, and that the Executive shall not publish any
of the inventions without the prior written consent of the Company. The
Executive hereby assigns to the Company all of his right, title and interest in
and to all of the foregoing. Notwithstanding the foregoing, the provisions of
this Section 8 do not apply to inventions for which no equipment, supplies,
facility, resources or Confidential Information of the Company was used and was
developed entirely on the Executive’s own time, unless the invention relates to
the Company’s business, to the Company’s actual or demonstrably anticipated
research or development, or the invention results from any work performed by the
Executive for the Company or any if its affiliates. Executive agrees to provide
the Company promptly with notice and sufficient documentation of any such
inventions so that the Company may evaluate the inventions and determine whether
such inventions should be assigned to the Company.
     (b) The Executive agrees that, at the Company’s expense, he will fully
cooperate with the Company, its attorneys and agents, at any time during or
after his employment, in the preparation and filing of all papers and other
documents as may be required to perfect the Company’s rights in and to any of
such inventions, including, but not limited to, joining in any proceeding to
obtain letters patent, copyrights, trademarks or other legal rights in the
United States and in any and all other countries on such inventions, provided
that the Company will bear the expense of such proceedings, and that any patent
or other legal rights so issued to the Executive personally, shall be assigned
by the Executive to the Company.
Section 9. Disclosure of Covenants and Return of Records.
     (a) The Executive agrees that he will provide, and that the Company may in
its discretion similarly provide, a copy of the covenants contained in

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Sections 6, 7, and 8 of this Agreement to any business or enterprise which the
Executive may directly or indirectly own, manage, operate, finance, join,
control or participate in the ownership, management, operation, financing,
control or control of, or with which the Executive may be connected as an
officer, director, employee, partner, principal agent, representative,
consultant or otherwise.
     (b) Upon termination of the Executive’s employment with the Company, the
Executive shall deliver to the Company any property of the Company which may be
in the Executive’s possession, including, without limitation, products,
materials, memoranda, notes, records, reports, or other documents or photocopies
of the same.
Section 10. Conflicting Agreements.
     The Executive hereby warrants and covenants that his employment by the
Company will not result in a breach of the terms, conditions or provisions of
any agreement to which the Executive is subject, and that he has not made and
will not make any agreements in conflict with this Agreement.
Section 11. Successors and Assigns.
     This Agreement is intended to bind and inure to the benefit of and be
enforceable by the Executive and the Company, except that the Executive may not
assign any of his rights or obligations under this Agreement and the Company may
not assign any of its rights or obligations under this Agreement without the
prior written consent of the other party.
Section 12. Severability.
     Whenever possible, each provision of this Agreement will be interpreted in
such manner as to be effective and valid under applicable law, but if any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability will not affect such provision in any other
jurisdiction, but this Agreement will be reformed, construed and enforced in
such jurisdiction as if such invalid, illegal or unenforceable provision had
never been contained herein.
Section 13. Notice.
     Any notice provided for in this Agreement must be in writing and must be
either personally delivered, mailed by first class mail (postage prepaid and
return receipt requested), sent by facsimile transmission or sent by reputable
overnight courier service, to the recipient at the address indicated below:

         
 
  To the Company:   Cyberkinetics Neurotechnology Systems, Inc.
 
      100 Foxborough Boulevard, Suite 240
 
      Foxborough, MA 02035
 
      Facsimile: 508-549-9985

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  To the Executive:   Mark A. Carney
 
       
 
       
 
       
 
       
 
  With a copy to:   Ice Miller LLP
 
      One American Square
 
      Suite 3100
 
      Indianapolis, Indiana 46282
 
      Attn: John R. Thornburgh
 
      Facsimile: (317) 592-4783

or to such other address or to the attention of such other person as the
recipient party shall have specified by prior written notice to the sending
party. Any notice under this Agreement will be deemed to have been given when so
delivered or sent or if mailed, five days after so mailed.
Section 14. Amendments and Waivers.
     Any provision of this Agreement may be amended or waived only with the
prior written consent of the Executive and a majority of the Compensation
Committee. Notwithstanding the foregoing, the failure of either party to require
the performance of any term or obligation of this Agreement, or the waiver by
either party of any breach of this Agreement, shall not prevent any subsequent
enforcement of such term or obligation or be deemed a waiver of any subsequent
breach.
Section 15. Entire Agreement.
     This Agreement (and the Option Agreement referenced herein) embodies the
complete agreement and understanding between the parties and supersedes and
preempts any prior understandings, agreements or representations by or between
the parties, written or oral, other than the applicable provisions of the
Investment Representation Letter provided to the Company by the Executive, which
may have related to the subject matter hereof in any way.
Section 16. Governing Law.
     All questions concerning the construction, validity and interpretation of
this agreement will be governed by the internal law, and not the law of
conflicts, of the Commonwealth of Massachusetts.
Section 17. Remedies.
     Each of the parties to this Agreement will be entitled to enforce his or
its rights under this Agreement specifically, to recover damages (including,
without limitation, reasonable fees and expenses of counsel) by reason of any
breach of any provision of this Agreement and to exercise all other rights
existing in his or its favor. The parties hereto agree and acknowledge that
money damages may not be an adequate remedy for any breach or threatened breach
of the provisions of this Agreement and that any

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party may in his or its sole discretion apply to any court of law or equity of
competent jurisdiction for specific performance and/or injunctive relief in
order to enforce or prevent any violations of the provisions of this Agreement.
Section 18. Captions.
     The captions set forth in this Agreement are for convenience only, and
shall not be considered as part of this Agreement or as in any way limiting or
amplifying the terms and provisions hereof.
Section 19. Representations and Warranties of Executive.
     The Executive represents and warrants to the Company that to the best of
his actual knowledge, after reasonable inquiry, all of the representations and
warranties of Andara Life Science, Inc. under that certain Agreement and Plan of
Merger, dated of even date herewith, by and among the Company, Andara
Acquisition Corp. and Andara Life Science, Inc. are true, correct and complete
in all material respects as of the date such representations and warranties were
made.
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     In witness whereof, the parties have signed, sealed and delivered this
Agreement as of the Effective Date.

            CYBERKINETICS NEUROTECHNOLOGY SYSTEMS, INC.
      By:   /s/ Timothy R. Surgenor         Timothy R. Surgenor        President
and Chief Executive Officer     

            EXECUTIVE:
        /s/ Mark A. Carney         Mark A. Carney           

 

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SCHEDULE 1
TO
EMPLOYMENT AGREEMENT
ANNUAL PERFORMANCE BONUS CRITERIA
The Company and the Executive agree that the provisions of this Schedule 1 shall
be determined by the mutual agreement of the parties no later than March 31,
2006.

 

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EXHIBIT A
Entities
MFS Bioscience, Inc. (Board and Founder)
InterMARK Technologies, Inc. (Owner)
Sb2 (Board and Founder)
Specialty Risk International, Inc. (Shareholder)

 

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EXHIBIT B
Option Agreement