**Exhibit10.40**

 

 

 

October 5,2007

 

Harry J. Leonhardt, Esq.

1176Via ZamiaEncinitas, CA 92024-6446

 

Dear Harry:

 

This letter (the “Agreement”)sets forth the terms of your resignation as an officer of, and your continuingconsulting relationship with, Senomyx, Inc. (the “Company”).

 

**1.             Separation.** You hereby resign from the position of Senior Vice President, GeneralCounsel & Corporate Secretary of the Company, Compliance Officer, andall other positions with the Company, and the Company hereby accepts suchresignation, effective as of October 5, 2007 (the “Separation Date”).    You acknowledge your continuing obligationsunder your Proprietary Information and Inventions Agreement, a copy of which isattached hereto as Exhibit A.  Youagree that your Continuous Service (as defined in the Company’s EquityIncentive Plan) will terminate on the Separation Date.

 

**2.             Accrued Salary.** On or prior to the Separation Date, the Company will pay to you allaccrued and unpaid salary earned through the Separation Date, less applicabledeductions and withholdings.

 

**3.             New Consulting Agreement.** You agree to serve as a consultant to the Company under the termsspecified below.

 

**(a)          ****Consulting Period.** Your service as a consultant hereunder shall commence concurrently withthe effectiveness of your resignation as an officer of the Company and end on October 5,2009, unless earlier terminated as provided below (the “Consulting Period”).

 

**(b)           Consulting Services.** During the Consulting Period you agree to provide general business andlegal consulting to the Company (the “Consulting Services”).  Upon request by the Company, and at timesmutually agreed upon, you shall devote up to a maximum of ten (10) days(as requested by the Company) annually to providing consulting services to theCompany pursuant to this Agreement.  Youagree to perform the Consulting Services at the 

 

 

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Company’s principal placeof business or at other places upon mutual agreement of between you and anauthorized representative of the parties. You also agree to perform areasonable amount of informal consultation with the Company over the telephoneor otherwise.  You agree to exercise thehighest degree of professionalism and utilize your expertise and talents in performingthe Consulting Services.  The Companyacknowledges that during the Consulting Period you will be an employee ofAmylin Pharmaceuticals; that you will be subject to their respective policies,as they may be revised from time to time, including, among others, policiesconcerning consulting, conflicts of interest, and intellectual property.

 

**(c)          ****Compensation; Expenses. **Your sole compensation forperforming the Consulting Services shall be as follows:  (a) an annual retainer for the firstyear of Consulting Services in the amount of Twenty Five Thousand Dollars($25,000), payable in advance on the Separation Date; and (b) a quarterlyretainer for the second year of Consulting Services in the amount of SixThousand Two Hundred and Fifty Dollars ($6,250.00), payable quarterly inadvance.  The Company will also reimburse you for allpre-approved business expenses reasonably incurred on behalf of the Companyduring the Consulting Period pursuant to its established expense reimbursementpolicy.

 

**(d)           IndependentContractor Status.**  You agreethat during the Consulting Period (i) you will be an independentcontractor to the Company and not an employee of the Company, and (ii) theCompany will not withhold or make payments for state or federal income tax orsocial security, make unemployment insurance or disability insurancecontributions, or obtain workers’ compensation insurance on your behalf.  With respect tothe consulting fees, the Company will not make any withholdings or deductions,and will issue you a form 1099.  Youshall be responsible for all taxes with respect to the ConsultingServices.  You understand thatexcept as provided in this Agreement, you will not be entitled to receive anyof the benefits the Company provides to its employees generally.  You will have no responsibilities or authorityas a consultant to the Company other than as provided in this Agreement.  You agree not to represent or purport torepresent the Company in any manner whatsoever to any third party unlessauthorized in writing by an authorized officer of the Company to do so.

 

**(e)           No Solicitation.** During the Consulting Period, you will not personally or through othersrecruit, solicit or induce any employee of the Company to terminate his or heremployment with the Company.

 

**(f)           ****Termination of Consulting Services.**  The term of this Agreement shall continueuntil October 5, 2009, unless terminated earlier as follows:

 

(i)            Company mayterminate the Agreement in the event of your gross negligence, grossmisconduct, dishonesty or willful and material breach of the Agreement (“cause”),provided that the Consultant has not remedied such breach within thirty (30)days of receipt of written notice thereof by the non-breaching party.

 

(ii)           The Agreement willautomatically terminate upon dissolution or cessation of business of theCompany; or

 

(iii)          The Agreement willautomatically terminate thirty (30) days after your death or disability.  As used in this Agreement, the term “disability”shall 

 

 

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mean inability,due to physical or mental disability, for a period of ninety (90) days, whetheror not consecutive, during any three hundred sixty (360) day period to performthe services contemplated under this Agreement.

 

Termination or expiration of this Agreement shall notaffect: (i) the Company’s obligation to pay for services previouslyperformed by you or expenses reasonably incurred by you for which you areentitled to reimbursement under Section 3(c); or (ii) your continuingobligations to the Company under Sections 6-13 below.

 

**4.             Other Compensation Or Benefits.** You acknowledge that, except as expressly provided in this Agreement,you will not receive any additional compensation, severance or benefits afterthe Separation Date.

 

**5.             Expense Reimbursements.** You agree that within 30 days after the Separation Date, you will submityour final documented expense reimbursement statement reflecting all businessexpenses you incurred through the Separation Date, if any, for which you seekreimbursement with respect to your Company employment.  The Company will reimburse you for theseexpenses pursuant to its regular business practices.

 

**6.             Return****Of****Company Property****.** You agree that, within 30 days after the Separation Date, you willreturn to the Company all Company documents and other Company property in yourpossession or control, including, but not limited to files, notes, memoranda,correspondence, agreements, notebooks, records, reports, tangible property andequipment; *provided, however*,that during the Consulting Period only, the Company will permit you to retain,receive, and/or use any documents, equipment and/or information reasonablynecessary to perform the Consulting Services, all of which documents, equipmentand information you must return to the Company within 30 days after thetermination or expiration of the Consulting Period.

 

**7.             Proprietary InformationObligations; Consulting Services Work Product.**

 

**(a)           Company Information.**During and after your consultingrelationship with the Company, you agree not to use or disclose any of theCompany’s confidential or proprietary information except as expresslyauthorized by the Company.  During theConsulting Period, you may receive and/or develop additional confidential andproprietary information relating to the Company’s technology know-how, data,inventions, developments, plans, business practices, strategies and products(collectively, the “Information”).  Such Information may include but not belimited to: (i) the Company’s marketing and customer support strategies,financial information (including sales, costs, profits and pricing methods),internal organization, employee information and customer lists; (ii) theCompany’s technology, including, but not limited to, discoveries, inventions,research and development efforts, data, software, trade secrets, processes,samples, formulas, methods, product and know-how and show-how; (iii) allderivatives, improvements, additions, modifications, and enhancements to any ofthe above, including any such information or material created or developed byyou under this Agreement; or (iv) information of third parties as to whichthe Company has an obligation of confidentiality.  You acknowledge the confidential and secretcharacter of the Information, and agree that the Information is the sole,exclusive and valuable property of the Company, and agree not to use, discloseor reproduce any of the Information without the prior written consent of theCompany, except in the performance of your authorized Consulting Services, andnot to disclose all or any 

 

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part of the Informationin any form to any third party, either during or after the ConsultingPeriod.  Upon the termination of theConsulting Period or upon the Company’s earlier request, you agree to ceaseusing and to return to the Company all whole and partial copies, reproductions,and derivatives of the Information, whether in your possession or under yourdirect or indirect control.

 

**(b)           Other Employer Information**. You agree that you will not, during your engagement with the Company,improperly use or disclose any proprietary information or trade secrets of yourformer or concurrent employers or companies, if any, and that you will notbring onto the premises of the Company any unpublished documents or anyproperty belonging to your former or concurrent employers or companies unless consentedto in writing by said employers or companies.

 

**(c)           Third Party Information**. You recognize that the Company has received and in the future willreceive from third parties their confidential or proprietary informationsubject to a duty on the Company’s part to maintain the confidentiality of suchinformation and, in some cases, to use it only for certain limitedpurposes.  You agree that you owe theCompany and such third parties, both during the term of your engagement andthereafter, a duty to hold all such confidential or proprietary information inthe strictest confidence and not to disclose it to any person, firm orcorporation (except in a manner that is consistent with the Company’s agreementwith the third party) or use it for the benefit of anyone other than theCompany or such third party (consistent with the Company’s agreement with thethird party).

 

**(d)           Disclosure of Inventions.** You shall promptly and fully disclose to theCompany any and all ideas, improvements, inventions, know-how, information,techniques and works of authorship learned, conceived or developed by youpursuant to your performance of the Consulting Services for the Company or oftasks assigned to you by the Company hereunder (the “Work Product”).  You agree to keep and maintain adequate andcurrent records (in the form of notes, sketches, drawings or in any other formthat may be required by the Company) of all work performed relating to theConsulting Services, including all proprietary information developed relatingthereto, and such records shall be available to and remain the sole property ofthe Company at all times.

 

**(e)           Inventions Assigned to the Company**. You agree that any and all Work Product shall be the sole and exclusiveproperty of the Company.  You hereby assignto the Company all of your right, title and interest in and to any and all WorkProduct.  You explicitly acknowledge andagree that all works of authorship contained in the Work Product are “works forhire” under the copyright laws of the United States, and that the Company shallown the copyright in all such works of authorship.  You further agree that******theCompany is and shall be vested with all rights, title and interests, includingpatent, copyright, trade secret and trademark rights, in all of your WorkProduct under this Agreement.

 

**(f)            Obtaining Intellectual PropertyProtection**.  You agree to assist the Company in everyproper way to obtain and enforce United States and foreign proprietary rightsrelating to the Work Product in any and all countries.  To that end, you agree to execute, verify anddeliver such documents and perform such other acts (including appearing as awitness) as the Company may reasonably request for use in applying for,obtaining, perfecting, evidencing, sustaining and enforcing such proprietaryrights and the assignment thereof.  Inaddition, you 

 

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agree to execute, verifyand deliver assignments of such proprietary rights to the Company or itsdesignee.  Your obligation to assist theCompany with respect to proprietary rights in any and all countries shallcontinue beyond the termination of your engagement, but the Company shallcompensate you at a reasonable rate after such termination for the timeactually spent by you at the Company’s request on such assistance.  In the event the Company is unable for anyreason, after reasonable effort, to secure your signature on any documentneeded in connection with the actions specified in the preceding paragraph, youhereby irrevocably designate and appoint the Company and its duly authorizedofficers and agents as your agent and attorney in fact, to act for and in yourbehalf to execute, verify and file, with the same legal force and effect as ifexecuted by you, any such documents and to do all other lawfully permitted actsto further the purposes of the preceding paragraph.  You hereby waive and quitclaim to the Companyany and all claims of any nature whatsoever which you now or may hereafter havefor infringement of any proprietary rights assigned to the Company.  During the Consulting Period and for one yearafter its termination for any reason, you will promptly disclose to the Companyfully and in writing all patent applications filed by you or on your behalf.

 

**8.             Confidentiality.** The provisions of this Agreement will be held in strictest confidence byyou and the Company and will not be publicized or disclosed in any mannerwhatsoever; *provided, however,* that: (a) you may disclose this Agreement in confidence toyour immediate family; (b) theparties may disclose this Agreement in confidence to their respectiveattorneys, accountants, auditors, tax preparers, and financial advisors; (c) the Companymay disclose this Agreement as necessary to fulfill Securities and ExchangeCommission or other standard or legally required corporate reporting ordisclosure requirements; (d) theparties may disclose this Agreement insofar as such disclosure may be necessaryto enforce its terms or as otherwise required by law; and (e) you maydisclose this Agreement to Amylin Pharmaceuticals.

 

**9.             Release of Claims.** Inexchange for the consideration under this Agreement to which you would nototherwise be entitled, you hereby generally and completely release the Companyand its directors, officers, employees, shareholders, partners, agents, attorneys,predecessors, successors, parent and subsidiary entities, insurers, affiliates,and assigns from any and all claims, liabilities and obligations, both knownand unknown, that arise out of or are in any way related to events, acts,conduct, or omissions occurring at any time prior to and including the date yousign this Agreement.  This generalrelease includes, but is not limited to: (a) all claims arising out of orin any way related to your employment with and/or consulting services for theCompany or the termination of that employment/consultancy; (b) all claimsrelated to your compensation or benefits from the Company, including consultingfees, salary, bonuses, commissions, vacation pay, expense reimbursements,severance pay, fringe benefits, stock, stock options, or any other ownershipinterests in the Company; (c) all claims for breach of contract, wrongfultermination, and breach of the implied covenant of good faith and fair dealing;(d) all tort claims, including claims for fraud, defamation, emotionaldistress, and discharge in violation of public policy; and (e) allfederal, state, and local statutory claims, including claims fordiscrimination, harassment, retaliation, attorneys’ fees, or other claimsarising under the federal Civil Rights Act of 1964 (as amended), the federalAmericans with Disabilities Act of 1990, the federal Age Discrimination inEmployment Act of 1967, as amended (“ADEA”), and the California Fair Employmentand Housing Act (as amended); provided, however, that nothing in this paragraph10 shall release the Company from any obligations it may have pursuant to thisAgreement.

 

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In exchange for theconsideration recited herein, the Company hereby generally and completelyreleases you from any and all claims, liabilities and obligations, both knownand unknown, that arise out of or are in any way related to events, acts,conduct or omissions occurring prior to your signing this Agreement arising outof or in any way related to your employment with the Company.

** **

**10.          ADEA Waiver. **You acknowledge that you are knowingly and voluntarilywaiving and releasing any rights you may have under the ADEA (“ADEA Waiver”).  You also acknowledge that the considerationgiven for the ADEA Waiver is in addition to anything of value to which you werealready entitled.  You furtheracknowledge that you have been advised by this writing, as required by theADEA, that:  (a) your ADEA Waiverdoes not apply to any rights or claims that arise after the date you sign thisAgreement; (b) you should consult with an attorney prior to signing thisAgreement; (c) you have 21 days to consider this Agreement (although youmay choose to voluntarily sign it sooner); (d) you have seven daysfollowing the date you sign this Agreement to revoke the ADEA Waiver (in awritten revocation sent to me); and (e) the ADEA Waiver will not beeffective until the date upon which the revocation period has expired, whichwill be the eighth day after you sign this Agreement; provided, however, thatnotwithstanding any other provision of this Agreement, in the event you revokethe ADEA Waiver during such 7 day period, the Consulting Period shall thereuponterminate immediately, the Company will pay you only the compensation earnedhereunder and expenses incurred through and including the effective date ofsuch termination and the Company shall thereafter have no further obligationsto you under this Agreement. Nevertheless, your general release of claims, except for the ADEAWaiver, is effective immediately and not revocable.

 

**11.          Section 1542 Waiver.** In granting the release herein, which includes claims which may beunknown at present, the parties acknowledge that they have read and understand Section 1542of the California Civil Code:  **“****A general release does notextend to claims which the creditor does not know or suspect to exist in hisfavor at the time of executing the release, which if known by him must havematerially affected his settlement with the debtor.”** The parties hereby expressly waive and relinquish all rights andbenefits under that section and any law or legal principle of similar effect inany jurisdiction with respect to the releases granted herein, including but notlimited to the release of unknown and unsuspected claims granted in thisAgreement.

 

**12.          Dispute Resolution.** To ensure rapid and economical resolution of any disputes regarding thisAgreement, the parties hereby agree that any and all claims, disputes orcontroversies of any nature whatsoever arising out of, or relating to, thisAgreement, or its interpretation, enforcement, breach, performance orexecution, your employment with the Company, or the termination of suchemployment, shall be resolved, to the fullest extent permitted by law, byfinal, binding and confidential arbitration in San Diego, California conductedbefore a single arbitrator by JAMS, Inc. (“JAMS”) or its successor, underthe then applicable JAMS arbitration rules. **The parties each acknowledge that by agreeing tothis arbitration procedure, they waive the right to resolve any such dispute,claim or demand through a trial by jury or judge or by administrativeproceeding. **You will have theright to be represented by legal counsel at any arbitration proceeding.**** The arbitratorshall:  (i) have the authority tocompel adequate discovery for the resolution of the dispute and to award suchrelief as would otherwise be available under applicable law in a courtproceeding; and (ii) issue a written statement signed by the arbitratorregarding the disposition of each claim and the relief, if 

 

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any, awarded as to eachclaim, the reasons for the award, and the arbitrator’s essential findings andconclusions on which the award is based. The arbitrator, and not a court, shall also be authorized to determinewhether the provisions of this paragraph apply to a dispute, controversy, orclaim sought to be resolved in accordance with these arbitration procedures.  Nothing in this Agreement is intended toprevent either you or the Company from obtaining injunctive relief in court toprevent irreparable harm pending the conclusion of any arbitration.

 

**13.          Miscellaneous.** This Agreement constitutes the complete, final and exclusive embodimentof the entire agreement between you and the Company with regard to its subjectmatter.  This Agreement is entered intowithout reliance on any promise or representation, written or oral, other thanthose expressly contained herein, and it supersedes any other such promises,warranties or representations.  ThisAgreement may not be modified or amended except in a writing signed by both youand a duly authorized officer of the Company. This Agreement will bind the heirs, personal representatives, successorsand assigns of both you and the Company, and inure to the benefit of both youand the Company, their heirs, successors and assigns.  If any provision of this Agreement isdetermined to be invalid or unenforceable, in whole or in part, thisdetermination will not affect any other provision of this Agreement and theprovision in question will be modified so as to be rendered enforceable.  This Agreement will be deemed to have beenentered into and will be construed and enforced in accordance with the laws ofthe State of California as applied to contracts made and to be performedentirely within California.  Anyambiguity in this Agreement shall not be construed against either party as thedrafter.  Any waiver of a breach of thisAgreement shall be in writing and shall not be deemed to be a waiver of anysuccessive breach.  This Agreement may beexecuted in counterparts and facsimile signatures will suffice as originalsignatures.

 

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If this Agreementis acceptable to you, please sign below and return the original to me.

 

We wish you thebest in your future endeavors.

 

Sincerely,

 

**SENOMYX,INC.**

 
| By: | /S/ JOHN  POYHONEN |
|-----|--------------------|

 

Title:  SVP, CHIEF FINANCIAL ANDBUSINESS OFFICER

 

**I HAVE READ, UNDERSTAND AND AGREE FULLY TO THEFOREGOING AGREEMENT:**

 
| /S/ HARRY J.  LEONHARDT       |
|-------------------------------|
| **HARRY  J. LEONHARDT, ESQ.** |

 

**DATE:**10/5/07

 

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**Exhibit A**

 

**SENOMYX, INC.**

 

**EMPLOYEE PROPRIETARY INFORMATION**

 

**AND INVENTIONS AGREEMENT**

 

In considerationof my employment or continued employment by SENOMYX, INC. (the “Company”), andthe compensation now and hereafter paid to me, I hereby agree as follows:

 

**1.             NONDISCLOSURE**

 

**1.1   Recognition of Company’s Rights;Nondisclosure.**  At all times during my employment andthereafter, I will hold in strictest confidence and will not disclose, use,lecture upon or publish any of the Company’s Proprietary Information (definedbelow), except as such disclosure, use or publication may be required inconnection with my work for the Company, or unless an officer of the Companyexpressly authorizes such in writing.  Iwill obtain Company’s written approval before publishing or submitting forpublication any material (written, verbal, or otherwise) that relates to mywork at Company and/or incorporates any Proprietary Information.  I hereby assign to the Company any rights Imay have or acquire in such Proprietary Information and recognize that allProprietary Information shall be the sole property of the Company and itsassigns.

 

**1.2   ProprietaryInformation. **The term “**ProprietaryInformation**” shall mean any and all confidential and/or proprietaryknowledge, data or information of the Company. By way of illustration but not limitation, “**ProprietaryInformation**” includes (a) trade secrets, inventions, maskworks, ideas, processes, formulas, source and object codes, data, programs,other works of authorship, know-how, improvements, discoveries, developments,designs and techniques (hereinafter collectively referred to as “**Inventions**”); and (b) information regarding plans forresearch, development, new products, marketing and selling, business plans,budgets and unpublished financial statements, licenses, prices and costs,suppliers and customers; and (c) information regarding the skills andcompensation of other employees of the Company. Notwithstanding the foregoing, it is understood that, at all such times,I am free to use information which is generally known in the trade or industry,which is not gained as result of a breach of this Agreement, and my own, skill,knowledge, know-how and experience to whatever extent and in whichever way Iwish.

 

**1.3   Third Party Information.**  Iunderstand, in addition, that the Company has received and in the future willreceive from third parties confidential or proprietary information (“**Third Party Information**”) subject to a duty on the Company’spart to maintain the confidentiality of such information and to use it only forcertain limited purposes.  During theterm of my employment and thereafter, I will hold Third Party Information inthe strictest confidence and will not disclose to anyone (other than Companypersonnel who need to know such information in connection with their work forthe Company) or use, except in connection with my work for the Company, ThirdParty Information unless expressly authorized by an officer of the Company inwriting.

 

**1.4   NoImproper Use of Information of Prior Employers and Others.** During my employment by the Company I will not improperly use ordisclose any confidential information or trade secrets, if any, of any formeremployer or any other person to whom I have an obligation of confidentiality,and I will not bring onto the premises of the Company any unpublished documentsor any property belonging to any former employer or any other person to whom Ihave an obligation of confidentiality unless consented to in writing by thatformer employer or person.  I will use inthe performance of my duties only information which is generally known and usedby persons with training and experience comparable to my own, which is commonknowledge in the industry or otherwise legally in the public domain, or whichis otherwise provided or developed by the Company.

 

**2.****                               ****ASSIGNMENT OF INVENTIONS.**

 

**2.1   Proprietary Rights.** The term “**Proprietary Rights**” shall mean alltrade secret, patent, copyright, mask work and other intellectual propertyrights throughout the world.

 

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**2.2   PriorInventions.**  Inventions, if any, patented or unpatented,which I made prior to the commencement of my employment with the Company areexcluded from the scope of this Agreement. To preclude any possible uncertainty, I have set forth on *Exhibit B*(Previous Inventions) attached hereto acomplete list of all Inventions that I have, alone or jointly with others,conceived, developed or reduced to practice or caused to be conceived,developed or reduced to practice prior to the commencement of my employmentwith the Company, that I consider to be my property or the property of thirdparties and that I wish to have excluded from the scope of this Agreement(collectively referred to as “**Prior Inventions**”).  If disclosure of any such Prior Invention wouldcause me to violate any prior confidentiality agreement, I understand that I amnot to list such Prior Inventions in *Exhibit B*but am only to disclose a cursory name for each such invention, a listing ofthe party(ies) to whom it belongs and the fact that full disclosure as to suchinventions has not been made for that reason. A space is provided on *Exhibit B* for such purpose.  If no such disclosure is attached, Irepresent that there are no Prior Inventions. If, in the course of my employment with the Company, I incorporate aPrior Invention into a Company product, process or machine, the Company ishereby granted and shall have a nonexclusive, royalty-free, irrevocable,perpetual, worldwide license (with rights to sublicense through multiple tiersof sublicensees) to make, have made, modify, use and sell such PriorInvention.  Notwithstanding theforegoing, I agree that I will not incorporate, or permit to be incorporated,Prior Inventions in any Company Inventions without the Company’s prior writtenconsent.

 

**2.3   Assignmentof Inventions.**  Subject to Sections 2.4, and 2.6, I herebyassign and agree to assign in the future (when any such Inventions orProprietary Rights are first reduced to practice or first fixed in a tangiblemedium, as applicable) to the Company all my right, title and interest in andto any and all Inventions (and all Proprietary Rights with respect thereto)whether or not patentable or registrable under copyright or similar statutes,made or conceived or reduced to practice or learned by me, either alone orjointly with others, during the period of my employment with the Company.  Inventions assigned to the Company, or to athird party as directed by the Company pursuant to this Section 2, arehereinafter referred to as “**Company Inventions**.”

 

**2.4   Nonassignable Inventions.** This Agreement does not apply to an Invention which qualifies fully as anonassignable Invention under Section 2870 of the California Labor Code(hereinafter “**Section 2870**”).  I have reviewed the notification on *Exhibit A* (Limited Exclusion Notification) and agreethat my signature acknowledges receipt of the notification.

 

**2.5   Obligation to Keep Company Informed.** During the period of my employment and for six (6) months aftertermination of my employment with the Company, I will promptly disclose to theCompany fully and in writing all Inventions authored, conceived or reduced topractice by me, either alone or jointly with others.  In addition, I will promptly disclose to theCompany all patent applications filed by me or on my behalf within a year aftertermination of employment.  At the timeof each such disclosure, I will advise the Company in writing of any Inventionsthat I believe fully qualify for protection under Section 2870; and I willat that time provide to the Company in writing all evidence necessary tosubstantiate that belief.  The Companywill keep in confidence and will not use for any purpose or disclose to thirdparties without my consent any confidential information disclosed in writing tothe Company pursuant to this Agreement relating to Inventions that qualifyfully for protection under the provisions of Section 2870.  I will preserve the confidentiality of anyInvention that does not fully qualify for protection under Section 2870.

 

**2.6   Governmentor Third Party.**  I also agree to assign all my right, titleand interest in and to any particular Company Invention to a third party,including without limitation the United States, as directed by the Company.

 

**2.7   Worksfor Hire.**  I acknowledge that all original works ofauthorship which are made by me (solely or jointly with others) within thescope of my employment and which are protectable by copyright are “works madefor hire,” pursuant to United States Copyright Act (17 U.S.C., Section 101).

 

**2.8   Enforcementof Proprietary Rights.**  I will assist the Company inevery proper way to obtain, and from time to time enforce, United States andforeign Proprietary Rights relating to Company Inventions in any and allcountries.  To that end I will execute,verify and deliver such documents and perform such other acts (includingappearances as a witness) as the Company may reasonably request for use inapplying for, obtaining, perfecting, evidencing, sustaining and enforcing suchProprietary Rights and the assignment thereof. In addition, I will execute, verify and deliver assignments of suchProprietary Rights to the Company or its designee.  My obligation to assist the Company withrespect to Proprietary Rights relating to such Company Inventions in any 

 

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and all countries shallcontinue beyond the termination of my employment, but the Company shallcompensate me at a reasonable rate after my termination for the time actuallyspent by me at the Company’s request on such assistance.

 

In the event the Company is unable for any reason,after reasonable effort, to secure my signature on any document needed inconnection with the actions specified in the preceding paragraph, I herebyirrevocably designate and appoint the Company and its duly authorized officersand agents as my agent and attorney in fact, which appointment is coupled withan interest, to act for and in my behalf to execute, verify and file any suchdocuments and to do all other lawfully permitted acts to further the purposesof the preceding paragraph with the same legal force and effect as if executedby me.  I hereby waive and quitclaim tothe Company any and all claims, of any nature whatsoever, which I now or mayhereafter have for infringement of any Proprietary Rights assigned hereunder tothe Company.

 

**3.           RECORDS. **I agree to keep and maintain adequate andcurrent records (in the form of notes, sketches, drawings and in any other formthat may be required by the Company) of all Proprietary Information developedby me and all Inventions made by me during the period of my employment at theCompany, which records shall be available to and remain the sole property ofthe Company at all times.

 

**4.         ADDITIONAL ACTIVITIES.**  Iagree that during the period of my employment by the Company I will not,without the Company’s express written consent, engage in any employment orbusiness activity which is competitive with, or would otherwise conflict with,my employment by the Company.  I agreefurther that for the period of my employment by the Company and for one (l) yearafter the date of termination of my employment by the Company I will not induceany employee of the Company to leave the employ of the Company.

 

**5.         NO CONFLICTING OBLIGATION.**  Irepresent that my performance of all the terms of this Agreement and as anemployee of the Company does not and will not breach any agreement to keep inconfidence information acquired by me in confidence or in trust prior to myemployment by the Company.  I have notentered into, and I agree I will not enter into, any agreement either writtenor oral in conflict herewith.

 

**6.         RETURN OF COMPANY DOCUMENTS.** When I leave the employ of the Company, I will deliver to the Companyany and all drawings, notes, memoranda, specifications, devices, formulas, anddocuments, together with all copies thereof, and any other material containingor disclosing any Company Inventions, Third Party Information or ProprietaryInformation of the Company.  I furtheragree that any property situated on the Company’s premises and owned by theCompany, including disks and other storage media, filing cabinets or other workareas, is subject to inspection by Company personnel at any time with orwithout notice.  Prior to leaving, I willcooperate with the Company in completing and signing the Company’s terminationstatement.

 

**7.         LEGAL AND EQUITABLE REMEDIES.** Because my services are personal and unique and because I may haveaccess to and become acquainted with the Proprietary Information of theCompany, the Company shall have the right to enforce this Agreement and any ofits provisions by injunction, specific performance or other equitable relief,without bond and without prejudice to any other rights and remedies that theCompany may have for a breach of this Agreement.

 

**8.         NOTICES.**  Any noticesrequired or permitted hereunder shall be given to the appropriate party at theaddress specified below or at such other address as the party shall specify inwriting.  Such notice shall be deemedgiven upon personal delivery to the appropriate address or if sent by certifiedor registered mail, three (3) days after the date of mailing.

 

**9.         NOTIFICATION OF NEW EMPLOYER.** In the event that I leave the employ of the Company, I hereby consent tothe notification of my new employer of my rights and obligations under thisAgreement.

 

**10.       GENERAL PROVISIONS.**

 

**10.1   GoverningLaw; Consent to Personal Jurisdiction.**  This Agreementwill be governed by and construed according to the laws of the State ofCalifornia, as such laws are applied to agreements entered into and to beperformed entirely within California between California residents.  I hereby expressly consent to the personaljurisdiction of the state and federal courts located in San Diego County,California for any lawsuit filed there against me by Company arising from orrelated to this Agreement.

 

**10.2   Severability.** In case any one or more of the provisions contained in this Agreementshall, for any reason, be held to be invalid, illegal or unenforceable in anyrespect, such invalidity, illegality or unenforceability shall not affect theother provisions of this Agreement, and this Agreement 

 

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shall be construedas if such invalid, illegal or unenforceable provision had never been containedherein.  If moreover, any one or more ofthe provisions contained in this Agreement shall for any reason be held to beexcessively broad as to duration, geographical scope, activity or subject, itshall be construed by limiting and reducing it, so as to be enforceable to theextent compatible with the applicable law as it shall then appear.

 

**10.3   Successorsand Assigns.**  This Agreement will be binding upon my heirs,executors, administrators and other legal representatives and will be for thebenefit of the Company, its successors, and its assigns.

 

**10.4   Survival.** The provisions of this Agreement shall survive the termination of myemployment and the assignment of this Agreement by the Company to any successorin interest or other assignee.

 

**10.5  Employment.**  I agree andunderstand that nothing in this Agreement shall confer any right with respectto continuation of employment by the Company, nor shall it interfere in any waywith my right or the Company’s right to terminate my employment at any time,with or without cause.

 

**10.6   Waiver.**  No waiver bythe Company of any breach of this Agreement shall be a waiver of any precedingor succeeding breach.  No waiver by theCompany of any right under this Agreement shall be construed as a waiver of anyother right.  The Company shall not berequired to give notice to enforce strict adherence to all terms of thisAgreement.

 

**10.7   EntireAgreement.**  The obligations pursuant to Sections 1 and 2of this Agreement shall apply to any time during which I was previouslyemployed, or am in the future employed, by the Company as a consultant if noother agreement governs nondisclosure and assignment of inventions during suchperiod.  This Agreement is the final, completeand exclusive agreement of the parties with respect to the subject matterhereof and supersedes and merges all prior discussions between us.  No modification of or amendment to thisAgreement, nor any waiver of any rights under this Agreement, will be effectiveunless in writing and signed by the party to be charged.  Any subsequent change or changes in myduties, salary or compensation will not affect the validity or scope of thisAgreement.

 

This Agreementshall be effective as of the first day of my employment with the Company,namely:  September 8, 2003.

 

**I HAVEREAD THIS AGREEMENT CAREFULLY AND UNDERSTAND ITS TERMS.  I HAVE COMPLETELY FILLED OUT EXHIBIT ATO THIS AGREEMENT.**

 
| Dated:                       | 9/8/03             |   |
|------------------------------|--------------------|--------|
|                         |               |
| /S/ HARRY J.  LEONHARDT      |               |
| **(Signature)**              |               |
|                         |               |
| HARRY J. LEONHARDT           |               |
| **(Printed  Name)**          |               |
|                         |               |
|                         |               |
| **ACCEPTED  AND AGREED TO:** |               |
|                         |               |
| **SENOMYX,  INC.**           |               |
|                         |               |
| By                           | /S/ KENT SNYDER    |   |
|                         |               |
| Title:                       | PRESIDENT AND  CEO |   |
|                         |               |
| 11099 N. TORREY  PINES RD.   |               |
| (Address)                    |               |
|                         |               |
| LA JOLLA, CA  92037          |               |
|                         |               |
| Dated:                       | 9/8/03             |   |
|                         |               |
|                              |                    |        |  |  |  |

12

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** **

** **

**Exhibit A**

 

**LIMITED EXCLUSION NOTIFICATION**

 

**THIS ISTO NOTIFY**you inaccordance with Section 2872 of the California Labor Code that theforegoing Agreement between you and the Company does not require you to assignor offer to assign to the Company any invention that you developed entirely onyour own time without using the Company’s equipment, supplies, facilities ortrade secret information except for those inventions that either:

 

1.                                                 Relate at the time of conception orreduction to practice of the invention to the Company’s business, or actual ordemonstrably anticipated research or development of the Company;

 

2.                Result from any work performed by you for theCompany.

 

                                To the extent aprovision in the foregoing Agreement purports to require you to assign aninvention otherwise excluded from the preceding paragraph, the provision isagainst the public policy of this state and is unenforceable.

 

                                This limitedexclusion does not apply to any patent or invention covered by a contractbetween the Company and the United States or any of its agencies requiring fulltitle to such patent or invention to be in the United States.

 

**                I ACKNOWLEDGE RECEIPT**of a copy of this notification.

 
|       | By: /S/ HARRY J.  LEONHARDT     |   |
|------------|---------------------------------|--------|
|       | **(PRINTED  NAME OF EMPLOYEE)** |
| ** ** |                            |
|       | Date: SEPTEMBER  8, 2003        |

 

**WITNESSEDBY:**

 

HOLLY WORKMAN

**(PRINTEDNAME OF REPRESENTATIVE)**

 

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**EXHIBIT B**

 
| **TO:**      | ** ** | **SENOMYX,  INC.**       |
|--------------|------------|--------------------------|
|         |       |                     |
| **FROM:**    | ** ** | **HARRY  J. LEONHARDT**  |
|         |       |                     |
| **DATE:**    | ** ** | **SEPTEMBER  8, 2003**   |
|         |       |                     |
| **SUBJECT:** | ** ** | **Previous  Inventions** |

 

**               **1**.**             Except as listed in Section 2below, the following is a complete list of all inventions or improvementsrelevant to the subject matter of my employment by **SENOMYX,INC.** (the “**Company**”) thathave been made or conceived or first reduced to practice by me alone or jointlywith others prior to my engagement by the Company:

 

             x        No inventions or improvements.

 

             o         See below:

 

o                          Additional sheets attached.

 

2**.**             Dueto a prior confidentiality agreement, I cannot complete the disclosure under Section 1above with respect to inventions or improvements generally listed below, theproprietary rights and duty of confidentiality with respect to which I owe tothe following party(ies):

 
| ** ** | ** ** | **Invention  or Improvement** | ** ** | **Party(ies)** | ** ** | **Relationship** |
|------------|------------|-------------------------------|------------|----------------|------------|------------------|

 

**1.**

 

**2.**

 

**3.**

 

o                          Additional sheets attached.

 

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