**Exhibit 10.34**

 

**EMPLOYMENT AGREEMENT**

 

This**EMPLOYMENT AGREEMENT** (the “Agreement”)is made and entered into as of the 21st day of May, 2006 (the “EffectiveDate”), by and between Accelrys, Inc.**,**a Delaware corporation (hereinafter, the “Company”), and Mark Emkjer**,** an individual (hereinafter, “Executive”).

 

**RECITALS**

 

**WHEREAS,** Executive has been employedby Company since 2002, pursuant and in accordance with the terms of anemployment agreement, dated December 3, 2002 (“2002 Agreement”).

 

**WHEREAS,**the Company and Executive desire to continue theemployment relationship on the terms set forth herein.

 

**NOW, THEREFORE,** in consideration of theirmutual promises and intending to be legally bound, the parties agree asfollows:

 

### **1.   EMPLOYMENT**.

 

#### **(a)  Title andLocation.**TheCompany shall continue to employ Executive as its President and Chief ExecutiveOfficer upon the terms and conditions set forth in this Agreement, andExecutive hereby accepts such employment. Executive will be based in San Diego,California.

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#### **(b)  Duties and Responsibilities.**Executive’s duties, powers andresponsibilities in such capacity shall be those which are customary for suchposition, as may be determined from time to time and assigned by the Company’sBoard of Directors. Executive agrees to perform and discharge such duties welland faithfully and to be subject to the supervision and direction of Executive’ssupervisor.

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#### **(c)  No Conflicts.**Executive’s positionunder this Agreement is a full-time position. Executive agrees to devoteExecutive’s full business time, effort, attention and energies to this position.Executive will not render any professional services or engage in any activitythat might be competitive with, adverse to the best interest of, or create theappearance of a conflict of interest with, the Company. Executive agrees toabide by the policies, rules and regulations of the Company as they may beamended from time to time.

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#### **(d)  No Other Agreement.**Executive represents and warrants theExecutive is not bound by any employment, consulting, noncompetition,confidentiality, finders, marketing or other agreement or arrangement thatwould, or might reasonably be expected to, prohibit or restrict Executive inany manner from performing Executive’s duties and obligations hereunder.

 

### **2.   TERM.**The term of this Agreement shall commence onthe Effective Date and shall continue thereafter until the effective date oftermination set forth in Section 13, below (“Term”).

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### **3.   COMPENSATION.**As compensation forExecutive’s services under this Agreement:

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#### **(a)  Base Salary.**The Company will payExecutive a base salary of four hundred thousand dollars ($400,000) per year (“BaseSalary”), to be paid semi-monthly in equal installments, less normallyapplicable payroll deductions. Executive’s Base Salary will be subject toannual review and adjustment by the Board or a duly appointed committeethereof, in either case in its sole discretion.

 

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#### **(b)  Incentive Bonus.**Executive shall be eligible to participate inthe Company’s management incentive plan, as may be implemented and modified bythe Company at its sole discretion. The Company and Executive agree thatExecutive’s initial bonus target percentage will be eighty-five percent (85%)of Executive’s Base Salary. Such amounts, payable to Executive under this planor any other bonus program, shall be referred to herein as the “IncentiveBonus.”  The Incentive Bonus for any yearwill be paid after the conclusion of the applicable fiscal year, based upon theBoard of Directors’ determination as to the amount of such bonus earnedpursuant to the terms of the management incentive plan, provided Executive isemployed by the Company or its successor on that date.

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### **(c)  Vacation and OtherBenefits.**Executiveshall be entitled to the benefit of paid vacation, holidays, group medical,accident and long-term disability insurance and other fringe benefits and taxqualified retirement plans as the Company shall make available from time totime to its other similarly situated senior executives. The Company may changeor amend its benefits as it deems appropriate from time to time.

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### **4.   TERMINATIONAND EFFECT OF TERMINATION.**Executive’s employment hereunder is **ATWILL** and may be terminated at any time by the Company for any reason.In the event of termination of Executive’s employment, the Company shall haveno liability to Executive for compensation or benefits, except as specified inthis Section 4 or as required by the Company’s benefits policy.

 

###### **(a)  Termination by the Company for Cause.**Executive’s employment may be terminated bythe Company for Cause at any time upon delivery of written notice to Executive.Upon such a termination, the Company shall have no obligation to Executiveother than the payment of all accrued, but unpaid, Base Salary and any unpaidexpenses or expense reimbursements prior to the effective date of suchtermination. For purposes of this Agreement, “Cause” means the occurrence ofany one or more of the following events or conditions:

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###### (i)  any material failure on thepart of Executive (other than by reason of disability as provided in Section4(e) below) to faithfully and professionally carry out Executive’s duties or tocomply with any other material provision of this Agreement, which failurecontinues for ten (10) days after written notice detailing such failure isdelivered by the Company; provided, that the Company shall not be required toprovide such notice in the event that such failure (A) is not susceptibleto remedy or (B) relates to the same type of acts or omissions as to which noticehas been given on a prior occasion;

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###### (ii)  Executive’s dishonesty(which shall include without limitation any misuse or misappropriation of theCompany’s assets), or other willful misconduct, if such dishonesty or otherwillful misconduct is intended to or likely to materially injure the businessof the Company;

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###### (iii)  Executive’s conviction ofany felony or of any other crime involving moral turpitude, whether or notrelating to Executive’s employment;

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###### (iv)  Executive’s insobriety oruse of drugs, chemicals or controlled substances either (A) in the course ofperforming Executive’s duties and responsibilities under this Agreement, or (B)otherwise affecting the ability of Executive to perform the same;

 

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###### (v)  Executive’s failure to comply with a lawfulwritten direction of the Company or the Board of Directors; or

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###### (vi)  Any wanton or willfuldereliction of duties by Executive.

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###### The existence of any of the foregoing events orconditions shall be determined by the Company in the exercise of its reasonablejudgment.

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###### **(b)  Involuntary Termination by the Companywithout Cause or Resignation by Executive with Good Reason.**The Company may involuntarily terminateExecutive’s employment under this Agreement at any time during the Term withoutCause upon delivery of written notice to Executive, and Executive may resign atany time during the Term with Good Reason (as defined in Section 4(c), below). Exceptas provided by Section 4(g) hereof concerning termination in connection with aChange of Control (as defined in such Section 4(g)), if, during the Term,Executive’s employment is terminated involuntarily by the Company without Causepursuant to this Section 4(b) or Executive resigns for Good Reason pursuant to Section4(c) during the Term, the Company shall:

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(i)  pay Executive all compensation and benefitsaccrued, but unpaid, up to the effective date of termination; and

 

(ii)  provided that, and for so long as, Executivecomplies with Executive’s obligations set forth in Section 7, below, continueto pay Executive each month (in accordance with the Company’s regular payrollpractices) an amount equal to one twelfth (1/12) Executive’s annual Base Salaryin effect as of the effective date of termination, for a period of twenty four(24) months after the effective date of termination;

 

(iii) pay Executive apro-rata lump sum amount, prorated for the number of full months during theapplicable fiscal year during which Executive had been employed by the Companyprior to his termination, of the bonus that would have been payable toExecutive had he remained employed throughout the year. Such bonus will bebased upon the percentage achievement against objectives as determined by theCompany’s board of directors at the conclusion of the applicable fiscal year tohave been earned pursuant to the terms of the Company’s management incentiveplan; and

 

(iv)provided that, and for so long as, Executive complies with his obligations setforth in Section 7, below, pay Executive, each month for a period of twentyfour (24) months, in accordance with the Company’s regular payroll practices,one twelfth (1/12) of an amount obtained by multiplying Executive’s targetbonus percentage in effect as of the effective date of termination (expressedas a decimal) times Executive’s annual Base Salary in effect as of such date oftermination;

 

#### (v)  Reimburse or otherwise pay Executive’sConsolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) payments formedical and dental insurance under the Company’s applicable plans for thelesser of (x) twenty four months from the effective date of termination or (y)the date upon which Executive becomes eligible for medical coverage from a newemployer. Executive shall notify the Company no later than 15 days afterbecoming eligible for such coverage.

 

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**(c)  Terminationby Executive for Good Reason.**Executive may terminate his employment under this Agreement during theTerm for Good Reason upon the provision of advance written notice to theCompany specifying in reasonable detail the events or conditions upon whichExecutive is basing such termination. The Company will be given theopportunity, but shall have no obligation, to “cure” such events or conditionswithin thirty (30) days after the provision by Executive of such notice. Subjectto the provisions of Section 4(g) hereof (concerning termination in connectionwith a Change of Control), if the Company elects in a written notice toExecutive not to cure such events or conditions or otherwise fails to so curesuch events or conditions within such thirty (30) day period, Executive mayterminate Executive’s employment with the Company for Good Reason effective atthe end of such 30 day notice period.

 

###### For purposes of thisAgreement, “Good Reason” means any one or more of the following events orconditions:

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(i)  the Company’s breach of any of the materialterms of this Agreement;

 

(ii)  the Company’s relocating its office at whichExecutive is principally employed on the Effective Date of this Agreement, to alocation which is more than fifty (50) miles from both Executive’s residenceand the offices of the Company at which Executive is principally employed onthe date of execution of this Agreement, and requiring Executive to commute tosuch location without Executive’s written consent;

 

(iii)  a material diminution in Executive’s title,duties or responsibilities or conditions of his employment from those in effecton the date of execution of this Agreement; or

 

###### (iv)  a reduction of more than10% in Executive’s annual Base Salary then-in-effect without Executive’sconsent (other than such a reduction applicable generally to other seniorexecutives of the Company)

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Solely for purposes of Section 4(g) below, “Good Reason” also means areduction in the Executive’s target bonus

 

###### **(d)  Termination byExecutive without Good Reason (Voluntary Resignation).**Executive may voluntarily resign his positionand terminate his employment under this Agreement without Good Reason at anytime. Upon such a termination, the Company shall have no obligation to paycompensation and provide benefits to Executive other than the payment of allaccrued, but unpaid, Base Salary and any other unpaid expenses or expensereimbursements prior to the effective date of such termination.

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#### **(e)  Disability.**If Executivebecomes disabled for more than one hundred eighty (180) days in any twelve (12)month period, the Company shall have the right to terminate Executive’semployment upon written notice to Executive. Executive shall be deemed disabledfor purposes of this Agreement either (i) if Executive is deemed disabled forpurposes of any long-term disability insurance policy paid for by the Companyand at the time in effect, or (ii) if in the exercise of the Company’sreasonable judgment, due to accident, mental or physical illness, Executivecannot perform Executive’s duties. In the event that during the Term, theCompany shall terminate Executive due to disability, as described above, Executiveshall be entitled to receive the benefits set forth in Section 4(b) (i.e., asif Executive were terminated by the Company without Cause).

 

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#### **(f)  Death.**In the event of the death of Executive, thisAgreement shall automatically terminate and any obligation to continue to paycompensation and benefits shall cease as of the date of death, except for thepayment of all accrued, but unpaid, Base Salary and any other unpaid expensesor expense reimbursement prior to the date of death.

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#### **(g)  Change ofControl Termination Without Cause or Resignation for Good Reason.**

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#### **(i)  Benefits. Subjectto Section 4(i) below,**inthe event Executive’s employment under this Agreement is terminated by theCompany involuntarily without Cause at any time during the period commencingtwo (2) months before and ending eighteen (18) months after the occurrence of aChange of Control during the Term, or Executive terminates employment with theCompany for Good Reason at any time during the period commencing two (2) monthsbefore and ending eighteen (18) months after the occurrence of a Change ofControl during the Term, the Company shall, in lieu of providing Executive withany amounts or benefits otherwise payable under this Agreement:

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(A)  pay Executive all compensation and benefitsaccrued, but unpaid, up to the effective date of termination; and

 

(B)  provided that, and for so long as, Executivecomplies with his obligations set forth in Section 7, below, pay Executive eachmonth, in accordance with the Company’s regular payroll practices an amountequal to two twelfths (2/12) Executive’s annual Base Salary in effect as of theeffective date of termination; for a period of twelve months after theeffective date of termination; and

 

(C)pay Executive a pro-rata lump sum amount, prorated for the number of fullmonths during the applicable fiscal year during which Executive had beenemployed by the Company prior to his termination, of the bonus that would havebeen payable to Executive had he remained employed throughout the year. Suchbonus will be based upon the percentage achievement against objectives asdetermined by the Company’s board of directors at the conclusion of theapplicable fiscal year to have been earned pursuant to the terms of the Company’smanagement incentive plan; and

 

#### (D) provided that, and forso long as, Executive complies with his obligations set forth in Section 7,below, pay Executive, each month for a period of twelve (12) months, inaccordance with the Company’s regular payroll practices, two twelfths (2/12) ofan amount obtained by multiplying Executive’s target bonus percentage in effectas of the effective date of termination (expressed as a decimal) timesExecutive’s annual Base Salary in effect as of such date of termination.

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#### (E)  Reimburse or otherwise pay Executive’s COBRApayments for medical and dental insurance under the Company’s applicable plansfor the lesser of (x) twenty four months from the effective date of terminationor (y) the date upon which Executive becomes eligible for medical coverage froma new employer. Executive shall notify the Company no later than 15 days afterbecoming eligible for such coverage.

 

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#### Anything contained in this Section 4(g)(i) to the contrarynotwithstanding, Executive shall not be entitled to any of the benefits setforth in this Section 4(g)(i) if Executive resigns and terminates suchemployment voluntarily (other than for Good Reason) or is terminated by theCompany (including without limitation any Acquiring Company) for Cause.

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#### For purposes of Sections 4(g)(i) and (ii) hereof, the term the “Company”shall include any Acquiring Company (as defined below) and all obligations ofthe Company under such Section shall be assumed by any Acquiring Company.

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**(ii)  StockOptions.**Subjectto Section 4(i) below, in the event Executive’s employment under this Agreementis terminated by the Company involuntarily without Cause at any time during theperiod commencing two (2) months before and ending eighteen (18) months afterthe occurrence of a Change of Control or Executive terminates his employmentwith the Company for Good Reason at any time during the period commencing two(2) months before and ending eighteen (18) months after the occurrence of aChange of Control:

 

#### (A)notwithstanding anything to the contrary contained in any stock option or otherequity award plan of the Company (“Equity Incentive Plan”), any and all stockoptions (“Stock Options”), stock appreciation rights (“SARs”), restricted stockunits or restricted stock (collectively “Equity Rights”) which were granted bythe Company to Executive prior to the Term or during the Term shall immediatelyaccelerate and become vested and exercisable upon the date of termination ofExecutive’s employment. SARs or Stock Options granted after execution of thisAgreement may be exercised during the earlier of (1) one (1) year following thedate of termination or (2) the expiration of the term of the SAR or StockOption, and the Company shall take all actions necessary or advisable to giveeffect to this Section 4(g)(ii)(A); and

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#### (B) all Equity Rights held by Executive whichwere granted to Executive prior to the execution of this Agreement, includingthose which have been accelerated as set forth in section 4(g)(ii)(A), above,shall be exercisable pursuant to the terms of the agreement(s) under which theywere granted, subject to and including, without limitation,  the post termination exercise provisions setforth in sections 4(g)(ii) of the 2002 Agreement (“Post Termination ExerciseProvisions”) which terms continue to govern. Provided that any Stock Optiongranted to Executive prior to the Term which on any date during the Term has **both** i) a shorter exercise period than setforth in Section 4(g)(ii)(A), above, in the event of a Change of Controltermination or resignation for Good Reason as set forth herein, **and** ii) an exercise price higher than theclosing price of Accelrys common stock, as listed in the NASDAQ National Marketat any time after execution of this Agreement, shall be automatically deemed tobe modified on such date so that the Stock Option may be exercised during thelater of (1) December 31st of the year in which such option wouldhave otherwise expired pursuant to the exercise terms of the applicableagreement, or 2) two and one half months following the date in which suchoption would have otherwise expired pursuant to the exercise terms of theapplicable agreement, but in no event later than the date of the expiration ofthe term of the Stock Option,

 

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#### andthe Company shall take all actions necessary or advisable to give effect tothis Section 4(g)(ii)(B).

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#### Anything contained in thisSection 4(g)(ii) to the contrary notwithstanding, Executive shall not beentitled to any of the benefits set forth in this Section 4(g)(ii) if Executiveresigns and terminates such employment voluntarily (other than for Good Reason)or is terminated by the Company (including without limitation any AcquiringCompany) for Cause.

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**(iii)  Definition of “Change of Control.”**  Forpurposes of this Agreement, a “Change of Control” of the Company shall mean theoccurrence of any of the following events or circumstances:

 

(A)any “person” (within the meaning of Section 13(d) or 14(d) of the SecuritiesExchange Act of 1934, as amended (the “Exchange Act”)), including a “group”within the meaning of such Section 13(d) but excluding the Company and any ofits subsidiaries and any employee benefit plan sponsored or maintained by theCompany or any subsidiary thereof (a “Person”), shall become the “beneficialowner” (as defined in Rule 13d-3 under the Exchange Act), directly orindirectly, of securities of the Company representing fifty percent (50%) or moreof the combined voting power of the Company’s then outstanding securitiesentitled to vote generally in the election of directors (“Company VotingSecurities”); or

 

(B)the consummation of a merger or consolidation of the Company, or the acceptanceby the stockholders of the Company of shares in a share exchange, where thePersons who were the beneficial owners of Company Voting Securities,outstanding immediately prior to such merger, consolidation or share exchange,do not beneficially own, directly or indirectly, immediately after such merger,consolidation or share exchange, securities representing more than fiftypercent (50%) of the combined voting power of the then outstanding CompanyVoting Securities or voting securities of the Acquiring Company in such merger,consolidation or share exchange, in substantially the same proportions as theirownership of the Company Voting Securities immediately prior to such merger,consolidation or share exchange; or

 

(C) a sale, exchange orother disposition or transfer (in one transaction or a series of relatedtransactions) of all or substantially all of the assets of the Company;provided, that a Change of Control shall not be deemed to have occurred where(x) the Company sells, exchanges or otherwise disposes or transfers all orsubstantially all of its assets to another corporation which is beneficiallyowned, directly or indirectly, immediately following such transaction by theholders of Company Voting Securities in substantially the same proportions as theirownership of the Company Voting Securities immediately prior to suchtransaction and (y) such corporation expressly assumes this Agreement; or

 

(D) such time as theContinuing Directors (as defined below) do not constitute at least a majorityof the Board of Directors of the Company (or, if applicable, of a

 

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successorto the Company), where the term “Continuing Director” means at any date amember of the Board who was (x) a member of the Board on the date of thisAgreement or (y) nominated or elected subsequent to such date by at least amajority of the directors who were Continuing Directors at the time of suchnomination or election or whose election to the Board was recommended orendorsed by at least a majority of the directors who were Continuing Directorsat the time of such nomination or election (it being understood that noindividual whose initial assumption of office occurred as a result of an actualor threatened election contest with respect to the election or removal ofdirectors or other actual or threatened solicitation of proxies or consents byor on behalf of a Person other than the Board shall be a Continuing Director).

 

#### **(iv)  Definition of “AcquiringCompany.” **For purposes of Section 4 of this Agreement,an “Acquiring Company” shall mean the resulting or surviving corporation, orthe company issuing cash or securities (or its ultimate parent company), in amerger, consolidation or share exchange involving the Company, or the successorcorporation to the Company (whether in any such transaction or otherwise).

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#### **(h)  Section 409A**. Any cash severance to be paid pursuant to Sections4(b), (c), or (g), or any portion thereof, as well as any payments due undersection 4(i) hereof, will not be paid during the six-month period followingExecutive’s termination of employment, unless the Company reasonably determinesthat paying such amounts immediately following Executive’s termination ofemployment would not result in the imposition of any tax under Section 409A ofthe Code (“Section 409A”), in which case such amounts shall be paid inaccordance with normal payroll practices. If any amount of cash severance isnot paid to Executive as a result of the previous sentence, on the first dayfollowing such six-month period, the Company will pay Executive a lump-sumamount equal to the cumulative amounts that would have otherwise been paid toExecutive during such six-month period pursuant to Sections 4(b), (c), (g) or(i), but were not paid. Thereafter, Executive will receive his remaining cashseverance payments pursuant to Sections 4(b) and (c) or (g) in accordance withthe Company’s normal payroll practices.

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## **(i)  GoldenParachute Tax Provisions.**In the event it is determined that any payments by the Company to orfor the benefit of Executive under this Agreement or otherwise pursuant towhich Executive is entitled to receive payments or benefits (such payments andbenefits collectively, the “Payments”) shall be subject to an excise tax byreason of the operation of Section 4999 of the Internal Revenue Code of 1986,as amended (the “Code”), relating to parachute payments, or any interest orpenalties are incurred by Executive with respect to such excise tax (suchexcise tax together with any such interest and penalties collectively, the “Excise****Tax”),then Executive shall receive (i) a payment from the Company sufficient to paythe Excise Tax, and (ii) an additional payment from the Company sufficient topay such Excise Tax and federal and state income taxes arising from thepayments made by the Company to Executive pursuant to this sentence (suchadditional payments collectively, the “Reimbursement Payments”). For purposesof determining the amount of the Reimbursement Payments, Executive shall bedeemed to (i) pay federal income taxes at the highest marginal rates offederal income taxation for the calendar year in which the ReimbursementPayments are to be made and (ii) pay applicable state and local incometaxes at the highest marginal rate of taxation for the calendar year in whichthe Reimbursement Payments are to be made, net of the maximum reduction infederal income taxes which could be obtained from deduction of such state andlocal taxes.

 

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#### Notwithstanding theforegoing, if it shall be determined that Executive is entitled toReimbursement Payments under the preceding paragraph, but that the Paymentswould not be subject to the Excise Tax if the Payments were reduced by anamount that is less than 10% of the portion of the Payments that would betreated as parachute payments under Section 280G of the Code, then theamounts payable to Executive under this Agreement shall be reduced (but notbelow zero) to the maximum amount that could be paid to Executive withoutgiving rise to the Excise Tax (the “SafeHarbor Cap”), and no Reimbursement Payments shall be made to Executive. Thereduction of the amounts payable hereunder, if applicable, shall be made byreducing first the payments under Section 4(g)(i)(D), unless analternative method of reduction is elected by Executive. For purposes ofreducing the Payments to the Safe Harbor Cap, only amounts payable under thisAgreement (and no other Payments) shall be reduced. If the reduction of theamounts payable hereunder would not result in a reduction of the Payments tothe Safe Harbor Cap, no amounts payable under this Agreement shall be reducedpursuant to this provision.

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#### Unlessthe Company and Executive otherwise agree in writing, the determination ofExecutive’s Excise Tax liability and the amount required to be paid under thisparagraph shall be made in writing by the Company’s accountants or attorneys(the “Advisors”). In the event that the Excise Tax incurred by Executive isdetermined by the Internal Revenue Service to be greater or lesser than theamount so determined by the Advisors, the Company and Executive agree topromptly make such payment, including interest and any tax penalties, to theother party as the Advisors reasonably determine is appropriate to ensure thatthe net economic effect to Executive under this paragraph, on an after-taxbasis, is as if the Excise Tax did not apply to Executive. For purposes ofmaking the calculations required by this paragraph, the Advisors may makereasonable assumptions and approximations concerning applicable taxes and mayrely on interpretations of the Code for which there is a “substantial authority”tax reporting position. The Company and Executive shall furnish to the Advisorssuch information and documents as the Advisors may reasonably request in orderto make a determination under this Section. The Company shall bear all coststhe Advisors may reasonably incur in connection with any calculationscontemplated by this paragraph.

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### **(j)  LiquidatedDamages/Release.**Executiveacknowledges that, upon executing a release as set forth below, any paymentsand benefits resulting from a termination of Executive’s employment underSection 4(b), (c) or (g) of this Agreement which are not required by law are insatisfaction of any and all claims that Executive may have against the Companyor any Acquiring Company (other than benefits under the Company’s benefit plansthat by their terms survive termination of employment, benefits under theConsolidated Omnibus Budget Reconciliation Act of 1985, as amended, and rightsto indemnification under certain indemnification arrangements for officers ofthe Company), and represent liquidated damages (and not a penalty). The Companywill require that Executive execute and not revoke a separation agreement and arelease of all claims in favor of the Company in a form reasonably satisfactoryto the Company prior to, and as a condition to, receipt of such payments andbenefits.

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### **5.  TAXES.**Except as set forth in Section 4(i) above,Executive will be responsible for the payment of any tax liability incurred asa result of this Agreement. The Company may withhold tax on any payments orbenefits provided to Executive as required by law or regulation. TheExecutive is solely responsible and liable for the satisfaction of all taxesand penalties that may arise under Section 409A of the Code, and the Companyshall not have any obligation to indemnify or otherwise hold Executive harmlessfrom any or all of such taxes. TheCompany shall have the sole discretion to interpret the requirements of theCode, including Section 409A, for purposes of this provision, but shall onlyact in accordance with written advice from its Advisors.

 

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### Nevertheless, if theCompany or Executive determine that delaying severance payments will avoidsubjecting Executive to Section 409(A) taxes and penalties, the Company shallmodify the payment terms of this Agreement to the limited extent, and for theminimum deferral period, that the Company reasonably determines is necessary toavoid subjecting Executive to Section 409A penalties.

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### **6.  CONFIDENTIAL INFORMATION.**Except as reasonably necessary to performExecutive’s duties hereunder, Executive agrees not to reveal to any otherperson or entity or use for Executive’s own benefit any confidentialinformation of or about the Company or its operations, both during and afterExecutive’s employment under this Agreement, including without limitationmarketing plans, financial information, key personnel, Executives’capabilities, salaries and benefits, customer lists, pricing and coststructures, operation methods and any other information not available to thepublic, without the Company’s prior written consent. These obligations are inaddition to any similar obligations set forth in the Company’s Invention andNon-Disclosure Agreement.

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### **7.  NON-COMPETITION;NON-SOLICITATION; NON-DISPARAGEMENT.**

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### **(a)  Restrictions.**For so long as Executive is receivingbenefits pursuant to section 4, above, Executive shall not, directly orindirectly:

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#### (i) be employed by, engagedin or participate in the ownership, management, operation or control of, or actin any advisory or other capacity (including as an individual, principal, agentExecutive, consultant or otherwise) for, any Competing Entity which conductsits business within the Territory (as the terms Competing Entity and Territoryare hereinafter defined); provided, however, that notwithstanding any of theforegoing, Executive may make solely passive investments in any CompetingEntity the common stock of which is “publicly held” and of which Executiveshall not own or control, directly or indirectly, in the aggregate securitieswhich constitute 5% or more of the voting power of such Competing Entity;

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#### (ii) solicit or divert any business or any customer or knownprospective customer from the Company or assist any person or entity in doingso or attempting to do so;

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#### (iii) cause or seek to causeany person or entity to refrain from dealing or doing business with the Companyor assist any person or entity in doing so; or

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#### (iv) solicit for employment, or advise or recommend to any other personor entity that he, she or it employ or solicit for employment or retention asan Executive or consultant, any person who is an Executive of, or exclusiveconsultant to, the Company (provided that this prohibition shall not apply inthe event of a Change of Control Termination or Resignation, as set forth inSection 4(g), above).

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(v) make any derogatory ordisparaging statement regarding the Company, its affiliates, directors, or itsemployees.

 

In the event Executiveviolates any of the foregoing restrictions, all payments or benefits beingprovided pursuant to Sections 4(b) and (c) shall immediately cease.

 

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**(b)  Definitions.**For purposes of this Section 7:

 

(i) “Competing Entity” meansany entity which is presently or hereafter engaged in any business of the typeor character engaged in by the Company or any of its subsidiaries including,without limitation, (A) the business of developing, marketing or sellingsoftware programs which use molecular simulation or analysis to predictchemical or biological activities; (B) the business of developing, marketing orselling software programs that store, manage or analyze chemical or biologicalinformation or (C) any business which is otherwise competitive with a businessconducted by the Company or any of its subsidiaries; and

 

(ii)“Territory” means North America, Europe and Japan.

 

Notwithstanding anything inthe above to the contrary, Executive may engage in the activities set forth inSection 7(a) hereof with the prior written consent of the Company, whichconsent shall not be unreasonably withheld. Further, in determining whether aspecific activity by Executive for a Competing Entity shall be permitted, theCompany will consider, among other things, the nature and scope of (A) theduties to be performed by Executive and (B) the business activities of theCompeting Entity at the time of Executive’s proposed engagement by such entity.

 

**(c)  Acknowledgement.**Executiveacknowledges and agrees that the covenants set forth in this Section arereasonable and necessary in all respects for the protection of the Company’slegitimate business interests (including without limitation the Company’sconfidential, proprietary information and trade secrets and client good-will,which represents a significant portion of the Company’s net worth and in whichthe Company has a property interest). Executive acknowledges and agrees that,in the event that Executive breaches any of the covenants set forth in thisSection, the Company shall be irreparably harmed and shall not have an adequateremedy at law; and, therefore, in the event of such a breach, the Company shallbe entitled to injunctive relief, in addition to (and not exclusive of) anyother remedies (including monetary damages) to which the Company may beentitled under law. If any covenant set forth in this Section 7 is deemedinvalid or unenforceable for any reason, it is the parties’ intention that suchcovenants be equitably reformed or modified to the extent necessary (and onlyto such extent to) render it valid and enforceable in all respects. In theevent that the time period and geographic scope referenced above is deemedunreasonable, overbroad, or otherwise invalid, it is the parties’ intentionthat the enforcing court shall reduce or modify the time period and/orgeographic scope to the extent necessary (and only to such extent necessary) torender such covenants reasonable, valid and enforceable in all respects.

 

**8.  ARBITRATION.**

 

**(a)  General**. In consideration of Executive’s service to the Company, its promise toarbitrate all employment related disputes and Executive’s receipt of thecompensation, pay raises and other benefits paid to Executive by the Company,at present and in the future, Executive agrees that any and all controversies,claims, or disputes with anyone (including the Company and any employee,officer, director, shareholder or benefit plan of the Company in their capacityas such or otherwise) arising out of, relating to, or resulting from Executive’sservice to the Company under this Agreement or otherwise or the termination ofExecutive’s service with the Company, including any breach of this Agreement,will be subject to binding arbitration under the Arbitration Rules set forth inCalifornia Code of Civil Procedure

 

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Section 1280 through 1294.2,including Section 1283.05 (the “Rules”)and pursuant to California law. Disputes which Executive agrees to arbitrate,and thereby agrees to waive any right to a trial by jury, include any statutoryclaims under state or federal law, including, but not limited to, claims underTitle VII of the Civil Rights Act of 1964, the Americans with Disabilities Actof 1990, the Age Discrimination in Employment Act of 1967, the Older WorkersBenefit Protection Act, the California Fair Employment and Housing Act, theCalifornia Labor Code, claims of harassment, discrimination or wrongfultermination and any statutory claims. Executive further understands that thisAgreement to arbitrate also applies to any disputes that the Company may havewith Executive.

 

**(b)  Procedure**. Executive agrees that any arbitration willbe administered by the American Arbitration Association (“AAA”) and that a neutral arbitratorwill be selected in a manner consistent with its National Rules for theResolution of Employment Disputes. The arbitration proceedings will allow fordiscovery according to the rules set forth in the *National Rules for the Resolution of Employment Disputes or CaliforniaCode of Civil Procedure*. Executive agrees that the arbitrator willhave the power to decide any motions brought by any party to the arbitration,including motions for summary judgment and/or adjudication and motions todismiss and demurrers, prior to any arbitration hearing. Executive agrees thatthe arbitrator will issue a written decision on the merits. Executive alsoagrees that the arbitrator will have the power to award any remedies, includingattorneys’ fees and costs, available under applicable law. Executiveunderstands the Company will pay for any administrative or hearing fees chargedby the arbitrator or AAA except that Executive will pay the first $125.00 ofany filing fees associated with any arbitration Executive initiates. Executiveagrees that the arbitrator will administer and conduct any arbitration in amanner consistent with the Rules and that to the extent that the AAA’s NationalRules for the Resolution of Employment Disputes conflict with the Rules, theRules will take precedence.

 

**(c)  Remedy**. Except as provided by the Rules,arbitration will be the sole, exclusive and final remedy for any dispute betweenExecutive and the Company. Accordingly, except as provided for by the Rules,neither Executive nor the Company will be permitted to pursue court actionregarding claims that are subject to arbitration. Notwithstanding, thearbitrator will not have the authority to disregard or refuse to enforce anylawful Company policy, and the arbitrator will not order or require the Companyto adopt a policy not otherwise required by law which the Company has notadopted.

 

**(d)  Availability of Injunctive Relief**. In addition to the right under the Rules topetition the court for provisional relief, Executive agrees that any party mayalso petition the court for injunctive relief where either party alleges orclaims a violation of this Agreement or the Confidentiality Agreement or anyother agreement regarding trade secrets, confidential information,nonsolicitation or Labor Code §2870. In the event either party seeks injunctiverelief, the prevailing party will be entitled to recover reasonable costs andattorneys’ fees.

 

**(e)  Administrative Relief**. Executive understands that this Agreementdoes not prohibit Executive from pursuing an administrative claim with a local,state or federal administrative body such as the Department of Fair Employmentand Housing, the Equal Employment Opportunity Commission or the workers’compensation board. This Agreement does, however, preclude Executive frompursuing court action regarding any such claim.

 

**(f)  Voluntary Nature ofAgreement**.Executive acknowledges and agrees that Executive is executing this Agreementvoluntarily and without any duress or undue influence by the Company or anyoneelse. Executive further acknowledges and agrees that Executive has carefullyread this Agreement and that Executive has asked any questions needed forExecutive to understand the terms, consequences

 

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and binding effect of thisAgreement and fully understand it, including that Executive is waivingExecutive’s right to a jury trial. Finally, Executive agrees that Executive hasbeen provided an opportunity to seek the advice of an attorney of Executive’schoice before signing this Agreement.

 

### **9.  WAIVER.**The waiver by the Company of any breach ofany provision of this Agreement shall not operate or be construed as a waiverof any subsequent breach by Executive of any provision of this Agreement.

###  

### **10.  SEVERABILITY.**The parties have carefully reviewed theprovisions of this Agreement and agree that they are fair and equitable. However,in light of the possibility of differing interpretations of law and changes ofcircumstances, the parties agree that in the event that any section, paragraphor term of this Agreement shall be determined to be invalid or unenforceable byany competent authority or tribunal for any reason, the remainder of thisAgreement shall be unaffected thereby and shall remain in full force and effect.Moreover, if any of the provisions of this Agreement is determined by a courtof competent jurisdiction to be excessively broad as to duration, activity,geographic application or subject, it shall be construed by limiting orreducing it to the extent legally permitted so as to be enforceable to theextent compatible with then applicable law.

###  

### **11.  SUCCESSORS AND ASSIGNS.**This Agreement shall bind and inure to thebenefit of the successors and assigns of the Company and the heirs, executorsor personal representatives of Executive. This Agreement may not be assigned byExecutive. This Agreement may be assigned to any successor in interest to theCompany (including by way of merger, consolidation or reorganization, or by wayof any assignment of all or substantially all of the Company’s assets, businessor properties), and Executive hereby consents to such assignment.

###  

### **12.  ENTIRE AGREEMENT; AMENDMENTS.**This Agreement, including the recitals (whichare a part hereof), together with the applicable bylaws and policies of theCompany, constitutes the entire Agreement between the parties hereto and thereare no other understandings, agreements or representations, expressed orimplied, with the exception of the Post Termination Exercise Provisions of the2002 Agreement. This Agreement supersedes any and all prior or contemporaneousagreements, oral or written, concerning Executive’s employment and compensation,except for any invention assignment and confidentiality terms of any agreementsigned by Executive, provided that the provisions of this Agreement relating toacceleration and time to exercise vested Stock Options in the event of a Changeof Control are in addition to, not in lieu of, any such similar provisions setforth in any Equity Incentive Plan or other document, including the PostTermination Exercise Provisions of the 2002 Agreement. This Agreement may beamended only in writing signed by Executive and a member of the Company’s Boardof Directors.

###  

### **13  TERMINATION; SURVIVAL.**TheCompany may terminate this Agreement upon written notice delivered to Executive.Such notice may be delivered to Executive at any time commencing twelve months afterthe Effective Date, which termination shall be effective twenty-four monthsafter delivery of such notice to Executive. Sections 5 (five) through 14(fourteen), inclusive shall survive the termination of this Agreement. Theobligations of Section 4 (four) shall survive only with regards to terminationof employment occurring prior to the effective date of termination of thisAgreement or with regards to a Change of Control occurring prior to theeffective date of termination of this Agreement. In all other respects theparties’

 

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### obligations setforth in Section 4 (four), above, shall terminate upon termination of thisAgreement.

 

### **14.  GOVERNING LAW.**This Agreement shallbe governed by and construed in accordance with the laws (other than conflictsof laws principles) of the State of California applicable to contracts executedin and to be performed entirely within such State by residents of such state.

 
| Dated as of |  May 21,  2006 | .                                                 |   |
|-------------|---------------------|---------------------------------------------------|--------|
|        |
|        | ACCELRYS, INC.      |
|        |                |
|        |
|        | By:                 |   /s/ Ricardo  Levy                |   |
|        |                | Ricardo Levy                                      |
|        |                | Chairman of the  Human Resources Committee of the |
|        |                | Board of  Directors                               |
|        |                |
|        |                |   /s/ Mark  Emkjer                 |   |

 

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